x

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended:   

March 31, 2016

o

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from:

to

Commission File Number:

001-11954

Maryland

22-1657560

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification Number)

888 Seventh Avenue, New York, New York

10019

(Address of principal executive offices)

(Zip Code)

x Large Accelerated Filer

o Accelerated Filer

o Non-Accelerated Filer (Do not check if smaller reporting company)

o Smaller Reporting Company

PART I.

Financial Information:

Page Number

Item 1.

Financial Statements:

Consolidated Balance Sheets (Unaudited) as of

March 31, 2016 and December 31, 2015

3

Consolidated Statements of Income (Unaudited) for the

Three Months Ended March 31, 2016 and 2015

4

Consolidated Statements of Comprehensive Income (Unaudited)  

for the Three Months Ended March 31, 2016 and 2015

5

Consolidated Statements of Changes in Equity (Unaudited) for the

Three Months Ended March 31, 2016 and 2015

6

Consolidated Statements of Cash Flows (Unaudited) for the

Three Months Ended March 31, 2016 and 2015

8

Notes to Consolidated Financial Statements (Unaudited)

10

Report of Independent Registered Public Accounting Firm  

30

Item 2.

Management's Discussion and Analysis of Financial Condition

and Results of Operations

31

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

58

Item 4.

Controls and Procedures

58

PART II.

Other Information:

Item 1.

Legal Proceedings

59

Item 1A.

Risk Factors

59

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

59

Item 3.

Defaults Upon Senior Securities

59

Item 4.

Mine Safety Disclosures

59

Item 5.

Other Information

59

Item 6.

Exhibits

59

SIGNATURES

60

EXHIBIT INDEX

61

VORNADO REALTY TRUST

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

(Amounts in thousands, except share and per share amounts)

March 31, 2016

December 31, 2015

ASSETS

Real estate, at cost:

Land

$

 4,164,796 

$

 4,164,799 

Buildings and improvements

 12,358,371 

 12,582,671 

Development costs and construction in progress

 1,305,849 

 1,226,637 

Leasehold improvements and equipment

 109,536 

 116,030 

Total

 17,938,552 

 18,090,137 

Less accumulated depreciation and amortization

 (3,352,986)

 (3,418,267)

Real estate, net

 14,585,566 

 14,671,870 

Cash and cash equivalents

 1,673,566 

 1,835,707 

Restricted cash

 109,147 

 107,799 

Marketable securities

 162,091 

 150,997 

Tenant and other receivables, net of allowance for doubtful accounts of $11,200 and $11,908

 97,345 

 98,062 

Investments in partially owned entities

 1,553,250 

 1,550,422 

Real estate fund investments

 566,696 

 574,761 

Receivable arising from the straight-lining of rents, net of allowance of $2,539 and $2,751

 973,709 

 931,245 

Deferred leasing costs, net of accumulated amortization of $218,709 and $218,239

 485,283 

 480,421 

Identified intangible assets, net of accumulated amortization of $188,094 and $187,360

 218,388 

 227,901 

Assets related to discontinued operations

 36,514 

 37,020 

Other assets

 411,819 

 477,088 

$

 20,873,374 

$

 21,143,293 

LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY

Mortgages payable, net

$

 9,844,242 

$

 9,513,713 

Senior unsecured notes, net

 844,514 

 844,159 

Unsecured revolving credit facilities

 -   

 550,000 

Unsecured term loan, net

 371,076 

 183,138 

Accounts payable and accrued expenses

 447,700 

 443,955 

Deferred revenue

 325,013 

 346,119 

Deferred compensation plan

 116,824 

 117,475 

Liabilities related to discontinued operations

 12,902 

 12,470 

Other liabilities

 433,863 

 426,965 

Total liabilities

 12,396,134 

 12,437,994 

Commitments and contingencies

Redeemable noncontrolling interests:

Class A units - 12,414,019 and 12,242,820 units outstanding

 1,172,256 

 1,223,793 

Series D cumulative redeemable preferred units - 177,101 units outstanding

 5,428 

 5,428 

Total redeemable noncontrolling interests

 1,177,684 

 1,229,221 

Vornado shareholders' equity:

Preferred shares of beneficial interest: no par value per share; authorized 110,000,000

shares; issued and outstanding 52,676,629 shares

 1,276,954 

 1,276,954 

Common shares of beneficial interest: $.04 par value per share; authorized

250,000,000 shares; issued and outstanding 188,771,002 and 188,576,853 shares

 7,529 

 7,521 

Additional capital

 7,187,036 

 7,132,979 

Earnings less than distributions

 (1,999,994)

 (1,766,780)

Accumulated other comprehensive income

 53,399 

 46,921 

Total Vornado shareholders' equity

 6,524,924 

 6,697,595 

Noncontrolling interests in consolidated subsidiaries

 774,632 

 778,483 

Total equity

 7,299,556 

 7,476,078 

$

 20,873,374 

$

 21,143,293 

See notes to consolidated financial statements (unaudited).

VORNADO REALTY TRUST

CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

(Amounts in thousands, except per share amounts)

For the Three Months Ended March 31,

2016 

2015 

REVENUES:

Property rentals

$

 519,492 

$

 500,274 

Tenant expense reimbursements

 59,575 

 66,921 

Fee and other income

 33,970 

 39,607 

Total revenues

 613,037 

 606,802 

EXPENSES:

Operating

 256,349 

 254,493 

Depreciation and amortization

 142,957 

 124,122 

General and administrative

 48,704 

 58,492 

Impairment loss and acquisition and transaction related costs

 165,307 

 1,981 

Total expenses

 613,317 

 439,088 

Operating (loss) income

 (280)

 167,714 

Loss from partially owned entities

 (4,240)

 (2,743)

Income from real estate fund investments

 11,284 

 24,089 

Interest and other investment income, net

 3,518 

 10,792 

Interest and debt expense

 (100,489)

 (91,674)

Net gain on disposition of wholly owned and partially owned assets

 714 

 1,860 

(Loss) income before income taxes

 (89,493)

 110,038 

Income tax expense

 (2,831)

 (971)

(Loss) income from continuing operations

 (92,324)

 109,067 

Income from discontinued operations

 716 

 16,179 

Net (loss) income

 (91,608)

 125,246 

Less net (income) loss attributable to noncontrolling interests in:

Consolidated subsidiaries

 (9,678)

 (15,882)

Operating Partnership

 7,487 

 (5,287)

Net (loss) income attributable to Vornado

 (93,799)

 104,077 

Preferred share dividends

 (20,364)

 (19,484)

NET (LOSS) INCOME attributable to common shareholders

$

 (114,163)

$

 84,593 

(LOSS) INCOME PER COMMON SHARE - BASIC:

(Loss) income from continuing operations, net

$

 (0.61)

$

 0.37 

Income from discontinued operations, net

 -   

 0.08 

Net (loss) income per common share

$

 (0.61)

$

 0.45 

Weighted average shares outstanding

 188,658 

 187,999 

(LOSS) INCOME PER COMMON SHARE - DILUTED:

(Loss) income from continuing operations, net

$

 (0.61)

$

 0.37 

Income from discontinued operations, net

 -   

 0.08 

Net (loss) income per common share

$

 (0.61)

$

 0.45 

Weighted average shares outstanding

 188,658 

 189,336 

DIVIDENDS PER COMMON SHARE

$

 0.63 

$

 0.63 

See notes to consolidated financial statements (unaudited).

VORNADO REALTY TRUST

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(UNAUDITED)

(Amounts in thousands)

For the Three Months Ended March 31,

2016 

2015 

Net (loss) income

$

 (91,608)

$

 125,246 

Other comprehensive income (loss):

Increase (reduction) in unrealized net gain on available-for-sale securities

 11,094 

 (21,332)

Pro rata share of other comprehensive income of nonconsolidated subsidiaries

 6 

 157 

Reduction in value of interest rate swaps and other

 (4,195)

 (771)

Comprehensive (loss) income

 (84,703)

 103,300 

Less comprehensive income attributable to noncontrolling interests

 (2,618)

 (19,881)

Comprehensive (loss) income attributable to Vornado

$

 (87,321)

$

 83,419 

See notes to consolidated financial statements (unaudited).

VORNADO REALTY TRUST

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(UNAUDITED)

(Amounts in thousands)

Non-

Accumulated

controlling

Earnings

Other

Interests in

Preferred Shares

Common Shares

Additional

Less Than

Comprehensive

Consolidated

Total

Shares

Amount

Shares

Amount

Capital

Distributions

Income

Subsidiaries

Equity

Balance, December 31, 2015

 52,677 

$

 1,276,954 

 188,577 

$

 7,521 

$

 7,132,979 

$

 (1,766,780)

$

 46,921 

$

 778,483 

$

 7,476,078 

Net loss attributable to Vornado

 -   

 -   

 -   

 -   

 -   

 (93,799)

 -   

 -   

 (93,799)

Net income attributable to

noncontrolling interests in 

consolidated subsidiaries

 -   

 -   

 -   

 -   

 -   

 -   

 -   

 9,678 

 9,678 

Dividends on common shares

 -   

 -   

 -   

 -   

 -   

 (118,867)

 -   

 -   

 (118,867)

Dividends on preferred shares

 -   

 -   

 -   

 -   

 -   

 (20,364)

 -   

 -   

 (20,364)

Common shares issued:

Upon redemption of Class A

 units, at redemption value

 -   

 -   

 157 

 6 

 14,476 

 -   

 -   

 -   

 14,482 

Under employees' share

option plan

 -   

 -   

 26 

 1 

 2,165 

 -   

 -   

 -   

 2,166 

Under dividend reinvestment plan

 -   

 -   

 4 

 -   

 357 

 -   

 -   

 -   

 357 

Distributions:

Real estate fund investments

 -   

 -   

 -   

 -   

 -   

 -   

 -   

 (13,487)

 (13,487)

Other

 -   

 -   

 -   

 -   

 -   

 -   

 -   

 (152)

 (152)

Deferred compensation shares

and options

 -   

 -   

 7 

 1 

 535 

 (186)

 -   

 -   

 350 

Increase in unrealized net gain on

available-for-sale securities

 -   

 -   

 -   

 -   

 -   

 -   

 11,094 

 -   

 11,094 

Pro rata share of other

comprehensive income of

nonconsolidated subsidiaries

 -   

 -   

 -   

 -   

 -   

 -   

 6 

 -   

 6 

Reduction in value of interest

rate swaps

 -   

 -   

 -   

 -   

 -   

 -   

 (4,195)

 -   

 (4,195)

Adjustments to carry redeemable

Class A units at redemption value

 -   

 -   

 -   

 -   

 36,524 

 -   

 -   

 -   

 36,524 

Redeemable noncontrolling interests'

share of above adjustments

 -   

 -   

 -   

 -   

 -   

 -   

 (427)

 -   

 (427)

Other

 -   

 -   

 -   

 -   

 -   

 2 

 -   

 110 

 112 

Balance, March 31, 2016

 52,677 

$

 1,276,954 

 188,771 

$

 7,529 

$

 7,187,036 

$

 (1,999,994)

$

 53,399 

$

 774,632 

$

 7,299,556