NAREIT ANNUAL CONFERENCE NOVEMBER 2019 OVERVIEW NEW YORK CITY - - PowerPoint PPT Presentation

NAREIT ANNUAL CONFERENCE NOVEMBER 2019

1

OVERVIEW

BEST-IN-CLASS ASSETS UNIQUE & SCALABLE PENN DISTRICT OPPORTUNITY LEADING OPERATING PLATFORM FORTRESS BALANCE SHEET TRACK RECORD OF VALUE CREATION NEW YORK CITY FOCUSED

2

HEADER TEXT HERE DEEP, TALENTED & EXPERIENCED MANAGEMENT TEAM

MIKE DOHERTY President & CEO of BMS MATTHEW IOCCO Executive Vice President, Chief Accounting Officer MARK HUDSPETH Executive Vice President, Head of Capital Markets FRED GRAPSTEIN Executive Vice President, Hotel Pennsylvania EDWARD P. HOGAN, JR. Executive Vice President, Retail Leasing ROBERT ENTIN Executive Vice President, Chief Information Officer JOSH GLICK Senior Vice President, Office Leasing PAUL C. HEINEN Senior Vice President, Office Leasing, theMART DAVID BELLMAN Senior Vice President, Development Design & Construction GEOFF SMITH Senior Vice President, Development LISA VOGEL Senior Vice President, Marketing ELI ZAMEK Senior Vice President, Development Design & Construction STEVE SANTORA Senior Vice President, Financial Operations JESSICA ROSS Senior Vice President, Financial Planning & Analysis NICK STELLO Senior Vice President, IT Infrastructure THOMAS SANELLI Executive Vice President & Chief Financial Officer, New York CRAIG STERN Executive Vice President, Tax & Compliance GARY HANSEN Senior Vice President & Controller - Alexander’s CATHERINE CRESWELL Senior Vice President, Investor Relations RICH FAMULARO Senior Vice President, Controller FRANK MAIORANO Senior Vice President, Tax & Compliance MYRON MAURER Chief Operations Officer, theMART GASTON SILVA Chief Operations Officer SUSAN MCCULLOUGH Senior Vice President, theMART - Tradeshows ELANA BUTLER Senior Vice President, Retail Leasing Counsel PAMELA CARUSO Senior Vice President, Office Leasing Counsel ALAN RICE Senior Vice President, Corporation Counsel CLIFF BROSER Senior Vice President, Acquisitions & Capital Markets ADAM GREEN Senior Vice President, Acquisitions & Capital Markets MARIO RAMIREZ Senior Vice President, Acquisitions & Capital Markets RICHARD RECZKA Senior Vice President, Acquisitions & Capital Markets JAN LACHAPELLE Senior Vice President, Acquisitions & Capital Markets

GLEN WEISS Executive Vice President, Office Leasing Co-Head of Real Estate STEVEN ROTH Chairman of the Board and Chief Executive Officer BARRY S. LANGER Executive Vice President, Development Co-Head of Real Estate HAIM S. CHERA Executive Vice President, Head of Retail DAVID R. GREENBAUM Vice Chairman JOSEPH MACNOW Executive Vice President, Chief Financial Officer, Chief Administrative Officer MICHAEL J. FRANCO President

C O R P O R AT E O F F I C E R S E X E C U T I V E V I C E P R E S I D E N T S S E N I O R V I C E P R E S I D E N T S

3

NEW YORK CITY IS OUR HOME & CONTINUES TO BE A MAGNET FOR TALENT AND COMPANIES

ECONOMIC GROWTH LABOR POOL INNOVATION TALENT ATTRACTION

• New York City has captured the greatest share
• f US (8.9%) and Global GDP (2.6%) of all cities

between 2010-2018

• New York City created more jobs than peers

across a diverse set of industries, while Tier 2 fast-growing cities are more heavily skewed to technology

• New York City has a growing population of

educated individuals (net in-migration of 33K people with bachelor degrees between 2014-2017)

• New York City is leading in new companies formed

(e.g., start-up density of 154.7 new businesses per 1000 vs. 150.4 for San Francisco)

• New York City has reached $13B of VC funding in

start-ups so far this year and captured 16% of total U.S. VC funding, second only to San Francisco

• New York City is the leading city for talent

attraction domestically (#1 city for top U.S. college graduates) and abroad (31% H1B visa approvals)

• New York City has the most ultra high net worth

individuals globally and is growing

Source: McKinsey & Co., PwC / CB Insights MoneyTree

4

RATIONALE FOR OWNING VORNADO STOCK

• Attractive common dividend yield of 4.0%1
• Trading at a signifjcant discount to NAV
• Deep, talented, proven management team
• Fortress balance sheet with substantial cash and available liquidity (~$3.36 billion today and growing) to fund Penn District and take advantage
• f future investment opportunities
• Only signifjcant way to invest publicly in fast growing West Side of Manhattan
• Growth from Penn District redevelopment – over 9 million SF existing portfolio with signifjcant NOI upside and value creation

– 6.8 million SF of offjce with average in-place rents of $67 PSF; neighboring properties to the west asking rents range from $98-225 PSF2 – 5.2 million SF under development now, which is being self-fjnanced with cash from 220 CPS

• Farley Building (845,000 rentable SF) development in process
• PENN 1 redevelopment in process
• PENN 2 transformation (1.8 million rentable SF) to commence in 1Q20

– Hotel Pennsylvania site (2.8 million rentable SF of development) – Other development sites

• Internal growth over time from highly sought-after existing assets (e.g., 770 Broadway, 555 California Street, theMART)
• Largest owner of LEED certifjed buildings in New York City with 26 million SF
• Management has consistently acted to create shareholder value
• 1. As of 11/7/2019 market close.
• 2. As of 9/30/2019.

5

FORTRESS BALANCE SHEET

• Investment grade debt — Baa2/BBB
• $2.1 BN in revolver capacity
• $1.0 BN in cash1
• Weighted average debt maturity — 3.6 years
• ~$9 BN of unencumbered assets

(Amounts in millions)

SEPTEMBER 30, 2019

Secured debt $ 5,674 Unsecured debt 1,855 Pro rata share of non-consolidated debt 2,807 Less: noncontrolling interests' share of consolidated debt (484) Total debt 9,852 Projected cash proceeds from 220 Central Park South (1,787) Cash, restricted cash and marketable securities1 (995) Net Debt $ 7,070 TTM EBITDA, as adjusted2 $ 1,119 Net Debt/EBITDA, as adjusted 6.3x

• 1. Includes $105 million 150 West 34th Street loan participation and deducts potential special dividend of approximately $390 million.
• 2. See page 30 for non-GAAP reconciliation.

6

HEADER TEXT HERE

G r e e n w i c h S t W

• W. Broadway

Thompson St Sulliivan St Broome St Waverly Pl Washington Sq N. Washington Sq S. Waverly Pl Greenwich Av

• W. 4th St

Commerce St Barrow St C h r i s t

• p

h e r S t

• W. 10th St
• W. 11th St

Bank St Spring St Bleecker St B l e e c k e r S t Hudson St Gansevoort St

• W. 10th St
• W. 20th St
• W. 20th St
• W. 28th St
• E. 28th St
• E. 30th St
• E. 30th St

5th Av University Pl Lexington Av Lexington Av 12th 12th Av Broadway

• W. Houston St

Av

• f

th e Ame ri c a s 7th Av 4 t h A Park Av South Madison Av 5th Av Broadway Broadway B r

• a

d w a y 8th Av

• W. 14th St
• W. 14th St

10th Av 9th Av 8th Av 10th Av 11th Av 9th Av 8th Av 7th Av 9th Av 8th Av 7th Av Park Av Madison Av 7th Av of the Americas (6th Av) Av of the Americas (6th Av) 5th Av

• W. 23rd St
• W. 23rd St
• W. 34th St
• W. 34th St
• W. 42nd St

Lafayette St Hudson St Varick St Greenwich St Washington St W a s h i n g t

• n

S t 7th Av Prince St

Washington Square Park unnel Union Square Park Gramarcy Park

Gramarcy Pk N USQ W

Madison Square Park Hudson Park High Line High Line High Line High Line High Line

W . H

• u

s t

• n

S t

Bryant Park

MURRA UNION SQUARE HUDSON SQUARE GREENWICH VILLAGE WEST VILLAGE SOHO CHELSEA FLATIRON PENN DISTRICT TIMES SQUARE SOUTH

PENN 2 770 BROADWAY 330 WEST 34TH PENN 1 PENN 11 4 UNION SQUARE SOUTH 512 WEST 22ND STREET 260 ELEVENTH AVENUE PENN 15 85 TENTH AVENUE 61 NINTH AVENUE 606 BROADWAY 100 WEST 33RD FARLEY BUILDING

6

Upon completion of the developments in process, the Penn District is expected to represent approximately 33% of NOI Components of NOI at share - Cash Basis

66% 20% 14%

NYC OFFICE NYC RETAIL PENN DISTRICT

23%

theMART / 555 CALIFORNIA

6

COMPONENTS OF PRO-FORMA NOI AT SHARE - CASH BASIS1

TTM 9/30/19 NOI: $1,169M

• 1. For the trailing twelve months ended 9/30/19, as adjusted for (i) the April 18th Retail Transaction, (ii) the termination of the ground lease at 608 Fifth Avenue, (iii) 330 Madison Avenue

(sold on July 11, 2019), (iv) 3040 M Street (sold on September 19, 2019), and (v) the adjustment to ofgset the accrual in Q4 2018 for the annual real estate tax increase at theMART. NOI is a non-GAAP measure. See “Non-GAAP Financial Measures” on page 31 of this presentation for additional information.

7

731 LEXINGTON AVENUE 1290 AVENUE OF THE AMERICAS

M I D T O W N

SELECT NEW YORK CITY OFFICE PROPERTIES

P L A Z A D I S T R I C T

595 MADISON AVENUE 640 FIFTH AVENUE 689 FIFTH AVENUE 888 SEVENTH AVENUE 650 MADISON AVENUE 280 PARK AVENUE 330 WEST 34TH STREET 350 PARK AVENUE PENN 1 61 NINTH AVENUE PENN 2 THE FARLEY BUILDING 512 WEST 22ND STREET 85 TENTH AVENUE 90 PARK AVENUE ONE PARK AVENUE 7 WEST 34TH STREET 770 BROADWAY PENN 11

G R A N D C E N T R A L P E N N D I S T R I C T M I D T O W N S O U T H PA R K AV E N U E C H E L S E A / M E AT PA C K I N G

8

484-486 BROADWAY 435 SEVENTH AVENUE 666 FIFTH AVENUE 510 FIFTH AVENUE 650 MADISON AVENUE 677 MADISON AVENUE 595 MADISON AVENUE 828-850 MADISON AVENUE 150 WEST 34TH STREET 640 FIFTH AVENUE 689 FIFTH AVENUE 697 FIFTH AVENUE 655 FIFTH AVENUE 1540 & 1535 BROADWAY 4 UNION SQUARE

SELECT NEW YORK CITY STREET RETAIL PROPERTIES

9

theMART

theMART building (Chicago) – best example of contemporary offjce space outside of Silicon Valley. Transformed from a showroom building to the premier creative and tech hub in the Midwest, resulting in signifjcant earnings growth and value creation

• 3,674,000 SF building – 95.0% Occupancy at 9/30/19
• Located in River North, the hottest submarket in Chicago
• Since 2011, have converted over 950,000 SF from showroom/trade

show space to creative offjce space

• 9/30/19 TTM Cash NOI (non-GAAP)1 of $102.9 million2 versus 2011

Cash NOI of $54.3 million

• In-place escalated rents average $47.73 PSF as of 9/30/19 (offjce

$43.26, showroom $53.21 and retail $55.05)

• In conjunction with the City of Chicago, theMART hosts Art
• n theMART, a curated series of digital artwork projects by

renowned artists across the 2.5 acre exterior river-façade of

• theMART. The installation is the largest permanent digital art

projection in the world. Major Tenants: – Motorola Mobility (guaranteed by Google) – ConAgra Foods Inc. – 1871 – Kellogg's – Allscripts Healthcare – Yelp Inc. – Paypal, Inc. – Razorfjsh – Allstate Insurance – Steelcase – Herman Miller

• 1. See page 32 for non-GAAP reconciliation.
• 2. The 9/30/19 TTM Cash NOI includes the add back of (i) free rent and (ii) the adjustment to ofgset the accrual in Q4 2018

for the annual real estate tax increase which is billed to tenants throughout 2019.

10 555 California Street – the franchise offjce building in San Francisco and arguably the most iconic building on the west coast.

• 1,819,000 SF complex – 100.0% occupancy at 9/30/19
• 9/30/19 TTM Cash NOI (non-GAAP)1 of $60.9 million at share
• In-place escalated rents average $80.96 PSF as of 9/30/19, which are

signifjcantly below market Major Tenants: – Bank of America – Blue Shield – Centerview Partners – Dodge & Cox – Fenwick & West LLP – Goldman Sachs – Jones Day – Kirkland & Ellis LLP – KKR – Lending Home Corporation – McKinsey & Company – Microsoft – Morgan Stanley – Sidley Austin – UBS

555 CALIFORNIA STREET

• 1. See page 32 for non-GAAP reconciliation.

11

HEADER TEXT HERE NATIONALLY RECOGNIZED, INDUSTRY-LEADING SUSTAINABILITY PROGRAM

SUSTA INA BILITY

SM

6-time Energy Star Partner of the Year; Sustained Excellence recipient 2019. Largest owner of LEED certifjed buildings in New York City with over 26 million square feet. All new commercial developments will be, at minimum, LEED Gold certifjed. NAREIT Leader in the Light award 10 years in a row. Global Real Estate Sustainability Benchmark (GRESB) “Green Star” since 2013, 7th year in a row. Our score of 91 ranks #4 out of 62 Listed (i.e. public) companies in the Americas region, and #59 out of the total 964 respondents. The Climate Group EP100 Member for commitment to 35% reduction in energy effjciency by 2026. 22% reduction in same-store greenhouse gas emission since 2009. Our marquee assets 731 Lexington Avenue and theMART are among the fjrst buildings to achieve Fitwel certifjcation.

www.vno.com

W H E R E TA L E N T I S O U R C L I E N T

12

HEADER TEXT HERE

P ENN DISTRICT

HUD S ON YAR D S CHELS EA TIM ES S QUARE M ID TOWN HELL’S KITCHEN UP PER EAS T SIDE UP P ER W ES T S ID E M ID TOWN S OUT H FLATIRON D IS TRICT FINAN CIA L D IS TRICT

NEW JERSEY BROOKLYN QUEENS

W ES T VILLAG E G REEN W ICH VILLAG E EA ST VIL L A GE L OWER EA ST SIDE TRIBECA S OHO G AR M EN T D IS TRICT

13

N E W J E R S E Y M A R Y L A N D

D E L A W A R E

M A S S A C H U S E T T S N E W Y O R K P E N N S Y LVA N I A V I R G I N I A C O N N E C T I C U T

PHILADELPHIA

1 HOUR & 15 MINUTES

BOSTON

3 HOURS & 30 MINUTES

WASHINGTON D.C.

3 HOURS

PENN STATION / MOYNIHAN TRAIN HALL IS THE LINCHPIN OF THE

NORTHEAST INNOVATION CORRIDOR

THE PENN DISTRICT IS THE EASIEST NEIGHBORHOOD TO GET TO AND SITS IN THE EPICENTER OF MANHATTAN.

Penn Station, including Moynihan Train Hall, is the busiest transportation hub in North America. Home to the Long Island Rail Road, New Jersey Transit, Amtrak and several subway lines.

14

“IN EVERY GREAT GLOBAL CITY, THE MOST VALUABLE REAL ESTATE STANDS ATOP THE MAJOR TRANSPORTATION HUB.“

ONCE REDEVELOPED, THE VORNADO PENN DISTRICT HOLDINGS WILL JOIN THE LIST.

• JLL RESEARCH, 4/23/19

15

REAL ESTATE ON TOP OF MAJOR TRANSIT HUBS COMMANDS PREMIUM RENTS & THE HIGHEST VALUES

T O K YO M I R A I N A T O W E R - S H I N J U K U S TAT I O N H O N G K O N G I C C - K O W L O O N / W E S T K O W L O O N S TAT I O N L O N D O N K I N G ’ S C R O S S - K I N G ’ S C R O S S / S T PA N C R A S S TAT I O N S H A N G H A I I C C / S H A N G H A I I A P M - S O U T H S H A A N X I S TAT I O N OUTLINE OF INTERNATIONAL TRANSIT HUB OVER THE PENN DISTRICT

HIGH LINE FARLEY PARK

MOYNIHAN TRAIN HALL FARLEY EMPIRE STATE BUILDING JACOB K. JAVITS CONVENTION CENTER MACY’S MADISON SQUARE GARDEN

PLAZA33

PENN 11 100 WEST 33RD ST MANHATTAN MALL PENN 1

330 WEST 34TH ST 7 WEST 34TH ST

PENN 15

(HOTEL PENN)

PENN 2

31ST STREET 32ND STREET 33RD STREET 30TH STREET 27TH STREET 29TH STREET 26TH STREET 8TH AVENUE 7TH AVENUE BROADWAY 9TH AVENUE 10TH AVENUE 11TH AVENUE 34TH STREET 35TH STREET 36TH STREET 37TH STREET 38TH STREET 39TH STREET 6TH AVENUE

TRAINS FOR MOYNIHAN TRAIN HALL AND PENN STATION BELOW

7 D B M F Q N R 1 2 3 1 A C E R N W

C A E 2 1 3 Q N R

W

F M B D 7

ESTIMATED OPENING

2022

T H E P E N N D I S T R I C T

H U D S O N YA R D S

H U D S O N R I V E R

M A N H AT TA N W E S T

650,000

RIDERS PER DAY

Metro-North Railroad

UNIQUE VALUE CREATION OPPORTUNITY

• Existing offjce leasable space of 6.8MM SF with average in-place rents of $67 PSF(1)
• Hudson Yards to the west asking rents range from $98-225 PSF(1)
• Transformation of the neighborhood, including from $3B of public investment, will

enormously enhance the value of the Penn District’s offjce and retail holdings

VORNADO OWNED PROPERTIES

16

THE PENN DISTRICT

THE EPICENTER OF THE NEW NEW YORK

• 1. As of 9/30/2019

17

TRANSFORMATION OF THE PENN DISTRICT IS UNDERWAY

18

DEVELOPMENT TIMELINE

2020

EXPECTED COMPLETION DATE:

FUTURE 2022 2021

PENN 15 260 ELEVENTH

OTHER PENN DISTRICT DEVELOPMENT OPPORTUNITIES

19

HEADER TEXT HERE

19

(Amounts in thousands, except square feet)

THE PENN DISTRICT

ACTIVE DEVELOPMENT/REDEVELOPMENT SUMMARY - AS OF SEPTEMBER 30, 2019

(2) (5)

ACTIVE PENN DISTRICT PROJECTS PROPERTY RENTABLE SQ. FT. BUDGET (1) AMOUNT EXPENDED REMAINDER TO BE EXPENDED STABILIZATION YEAR PROJECTED INCREMENTAL CASH YIELD

Farley (95% interest) 845,000 1,030,000 528,080 501,920 2022 7.4% PENN 2 - as expanded 1,795,000 750,000 34,372 715,628 2024 8.4% PENN 1(3) 2,544,000 325,000 57,355 267,645 N/A 13.5% (3)(4) Districtwide Improvements N/A 100,000 5,372 94,628 N/A N/A Total Active Penn District Projects 2,205,000 625,179 1,579,821 8.3%

• 1. Excluding debt and equity carry.
• 2. Net of anticipated historic tax credits.
• 3. Property is ground leased through 2098, as fully extended. Fair market value resets occur in 2023, 2048 and 2073. The 13.5% projected return is before the ground rent reset in 2023,

which may be material.

• 4. Achieved as existing leases roll; average remaining lease term 5.0 years.
• 5. Expected to be funded from our balance sheet, principally from 220 CPS net sales proceeds.

There can be no assurance that the above projects will be completed, completed on schedule or within budget. In addition, there can be no assurance that the Company will be successful in leasing the properties on the expected schedule or at the assumed rental rates.

Capital to fund these projects comes entirely from 220 CPS proceeds

20

SIGNIFICANT DRY POWDER AVAILABLE FOR CURRENT PIPELINE & FUTURE INVESTMENTS

INVESTMENT OPPORTUNITIES

PENN 15 260 ELEVENTH

SOURCES USES AVAILABLE TO FUND FUTURE GROWTH

FARLEY COST TO COMPLETE2

502,000

PENN 1 COST TO COMPLETE

268,000

PENN 2 COST TO COMPLETE

716,000

DISTRICTWIDE IMPROVEMENTS

95,000

(Amounts in thousands)

$2,782,000 $1,581,000 $1,201,0003

• 1. Includes restricted cash, marketable securities and 150 West 34th Street loan participation, as of 9/30/19, and deducts potential special dividend of approximately $390 million.
• 2. Farley development costs at our share, net of anticipated historic tax credits.
• 3. Does not include $1.83 billion of preferred equity received as part of the Retail Transaction.

220 CPS REMAINING NET PROCEEDS

1,787,000

CASH AS OF 9/30/191

995,000

21

FARLEY

UNIQUE HORIZONTAL CAMPUS DIRECTLY ON TOP OF TRANSPORTATION

21

22

FARLEY

OFFICE INTERIORS & ROOFTOP PARK

22

23

PENN 1

34TH STREET ENTRANCE

24

PENN 1

LOBBY, AMENITY SPACE & PLAZA33

25

PENN 2

TRANSFORMATIVE REDEVELOPMENT

26

New rooftop terrace New penthouse duplex Two exterior loggias located on all floors New 4,000 SF town hall space New modern curtain wall Two Bustle floors, 44,000 RSF each, featuring double height ceilings and column free space New triple height lobby located off of 33rd Street tree lined plaza

PENN 2

REDEVELOPMENT FEATURES

27

PENN 2

7TH AVENUE & 33RD STREET LOBBY

APPENDIX

28 28

29

NON-GAAP FINANCIAL MEASURES

This investor presentation contains certain non-GAAP fjnancial measures, including net operating income (“NOI”) and earnings before interest, taxes, depreciation and amortization (“EBITDA”). NOI represents total revenues less operating expenses. We consider NOI to be the primary non-GAAP fjnancial 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. As properties are bought and sold based on NOI, we utilize this measure to make investment decisions as well as to compare the performance of our assets to that of our peers. NOI should not be considered a substitute for net income. NOI may not be comparable to similarly titled measures employed by other companies. We calculate NOI on an Operating Partnership basis which is before allocation to the noncontrolling interest of Vornado Realty L.P. (the "Operating Partnership"). EBITDA represents earnings before interest, taxes, depreciation and amortization. EBITDA is essentially NOI less general and administrative expenses. We use EBITDA as a secondary non-GAAP measure primarily in the context of a net debt to EBITDA ratio. We calculate EBITDA on an Operating Partnership basis which is before allocation to the noncontrolling interest of Vornado Realty L.P. (the "Operating Partnership"). A reconciliation of NOI and EBITDA to net income, the most directly comparable GAAP measure, is provided on the following pages. These non-GAAP fjnancial measures are used by management, investors and analysts to facilitate meaningful comparisons of operating performance between periods and among our peers because they exclude the efgect 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 fmuctuating based on existing market conditions. These metrics do not represent cash generated from operating activities and are not necessarily indicative of cash available to fund obligations and should not be considered as an alternative to net income as performance measures or cash fmow as liquidity measures. These non-GAAP metrics may not be comparable to similarly titled measures employed by other companies.

30 Reconciliation of Net income attributable to the Operating Partnership to EBITDA and EBITDA, as adjusted for the trailing twelve months ended September 30, 2019

NON-GAAP RECONCILIATIONS

(Amounts in millions)

For the TTM September 30, 2019

Net income attributable to the Operating Partnership $ 3,259 Interest and debt expense 410 Depreciation and amortization 535 Income tax expense 114 EBITDA 4,318 Adjustments, net (1) (3,199) EBITDA, as adjusted $ 1,119

• 1. Includes our share of gain on transfer to Fifth Avenue and Times Square JV, income from our sold properties, our Real Estate Fund, gains on sale of real estate,

impairment losses, change in fair value of marketable securities, gains on sale of 220 CPS condominium units and other adjustments.

31

(Amounts in millions)

NON-GAAP RECONCILIATIONS

For the TTM Ended September 30, 2019

Net income $ 3,271 Depreciation and amortization expense 439 General and administrative expense 163 Transaction related costs, impairment losses and other 118 Income from partially owned entities (59) Loss from real estate fund investments 65 Interest and other investment income, net (24) Interest and debt expense 310 Net gain on transfer to Fifth Avenue and Times Square JV (2,571) Net gains on disposition of wholly owned and partially owned assets (723) Purchase price fair value adjustment (44) Income tax expense 113 NOI from partially owned entities 297 NOI attributable to noncontrolling interests in consolidated subsidiaries (72) Adjustment for Retail Transaction1 (60) Non cash adjustments for straight-line rents, amortization of acquired below-market leases, net and other2 (23) Total NOI at share - Cash Basis 1,200 Other Investments NOI - Cash Basis (31) NOI at share - Cash Basis $ 1,169

For the TTM Ended September 30, 2019

New York: Offjce (includes $27MM of BMS NOI) $ 700 Retail2 230 Residential 22 Alexander's 45 Hotel Pennsylvania 7 1,004 Other: theMART (including trade shows)2 105 555 California Street 60 165 NOI at share - Cash Basis excluding other investments $ 1,169

Reconciliation of Net income to Pro-Forma NOI at share - Cash Basis for the trailing twelve months ended September 30, 2019 Pro-Forma NOI at share - Cash Basis by segment:

• 1. Adjustment for the April 18th Retail Transaction impact on NOI.
• 2. Includes adjustment for Topshop at 608 Fifth Avenue, 330 Madison Avenue (sold July 11, 2019), 3040 M Street (sold September 19, 2019) and the adjustment to ofgset

the accrual in Q4 2018 for the annual real estate tax increase at theMART.

32

For the TTM Ended September 30, 2019 at share For the Year Ended December 31, 2012 at share Net income (loss) $ 15.3 $ (4.6) Interest and debt expense 17.3 22.0 Depreciation and amortization 26.6 28.5 Income tax expense 0.8 0.3 EBITDA 60.0 46.2 Non-cash adjustments and other (0.6) (9.1) NOI at share - Cash Basis 59.4 37.1 Free rent 1.5 1.1 NOI at share - Cash Basis as adjusted $ 60.9 $ 38.2 For the TTM Ended September 30, 2019 For the Year Ended December 31, 2011 Net income (loss) $ 24.1 $ (4.5) Interest and debt expense 18.7 31.2 Depreciation and amortization 40.3 21.6 EBITDA 83.1 48.3 Non-cash adjustments and other 5.3 3.1 NOI - Cash Basis 88.4 51.4 Real estate tax expense adjustment 9.0 — Free rent 5.5 2.9 NOI - Cash Basis as adjusted $ 102.9 $ 54.3

Reconciliation of theMART Net income to EBITDA, NOI - Cash Basis and NOI - Cash Basis as adjusted for the year ended December 31, 2011 and for the trailing twelve months ended September 30, 2019 Reconciliation of 555 California Street Net income to EBITDA, NOI at share - Cash Basis and NOI at share - Cash Basis as adjusted for the year ended December 31, 2012 and for the trailing twelve months ended September 30, 2019

(Amounts in millions)

NON-GAAP RECONCILIATIONS

NAREIT ANNUAL CONFERENCE NOVEMBER 2019