Vornado Announces First Quarter 2022 Financial Results
Vornado Realty Trust (NYSE: VNO) reported a significant increase in net income for Q1 2022, reaching $26.5 million or $0.14 per diluted share, compared to $4.1 million or $0.02 in Q1 2021. Adjusted net income also rose to $31.7 million or $0.16 per diluted share. Funds from Operations (FFO) attributable to common shareholders increased to $154.9 million or $0.80 per diluted share. Leasing activity included 272,000 square feet of New York office space with an initial rent of $81.07 per square foot. Vornado also announced plans to sell several properties, anticipating significant gains.
- Net income increased to $26.5 million, or $0.14 per diluted share, from $4.1 million, or $0.02 per diluted share in Q1 2021.
- Adjusted net income attributable to common shareholders rose to $31.7 million, or $0.16 per diluted share.
- Funds from Operations (FFO) increased to $154.9 million, or $0.80 per diluted share, from $118.4 million, or $0.62 per diluted share.
- 272,000 square feet of New York office space leased at an initial rent of $81.07 per square foot.
- Expected gains from the sale of properties, including a projected $15 million gain from the Center Building sale.
- None.
NEW YORK, May 02, 2022 (GLOBE NEWSWIRE) -- Vornado Realty Trust (NYSE: VNO) reported today:
Quarter Ended March 31, 2022 Financial Results
NET INCOME attributable to common shareholders for the quarter ended March 31, 2022 was
FUNDS FROM OPERATIONS ("FFO") attributable to common shareholders plus assumed conversions (non-GAAP) for the quarter ended March 31, 2022 was
The following table reconciles net income attributable to common shareholders to net income attributable to common shareholders, as adjusted (non-GAAP):
| (Amounts in thousands, except per share amounts) | For the Three Months Ended March 31, | ||||||
| 2022 | 2021 | ||||||
| Net income attributable to common shareholders | $ | 26,478 | $ | 4,083 | |||
| Per diluted share | $ | 0.14 | $ | 0.02 | |||
| Certain expense (income) items that impact net income attributable to common shareholders: | |||||||
| Hotel Pennsylvania loss | $ | 8,929 | $ | 8,990 | |||
| After-tax net gain on sale of 220 Central Park South ("220 CPS") condominium units | (5,412 | ) | — | ||||
| Deferred tax liability on our investment in Farley Office and Retail (held through a taxable REIT subsidiary) | 3,173 | — | |||||
| Other | (1,100 | ) | (66 | ) | |||
| 5,590 | 8,924 | ||||||
| Noncontrolling interests' share of above adjustments | (386 | ) | (561 | ) | |||
| Total of certain expense (income) items that impact net income attributable to common shareholders | $ | 5,204 | $ | 8,363 | |||
| Per diluted share (non-GAAP) | $ | 0.02 | $ | 0.04 | |||
| Net income attributable to common shareholders, as adjusted (non-GAAP) | $ | 31,682 | $ | 12,446 | |||
| Per diluted share (non-GAAP) | $ | 0.16 | $ | 0.06 | |||
The following table reconciles FFO attributable to common shareholders plus assumed conversions (non-GAAP) to FFO attributable to common shareholders plus assumed conversions, as adjusted (non-GAAP):
| (Amounts in thousands, except per share amounts) | For the Three Months Ended March 31, | ||||||
| 2022 | 2021 | ||||||
| FFO attributable to common shareholders plus assumed conversions (non-GAAP)(1) | $ | 154,908 | $ | 118,407 | |||
| Per diluted share (non-GAAP) | $ | 0.80 | $ | 0.62 | |||
| Certain (income) expense items that impact FFO attributable to common shareholders plus assumed conversions: | |||||||
| After-tax net gain on sale of 220 CPS condominium units | $ | (5,412 | ) | $ | — | ||
| Deferred tax liability on our investment in Farley Office and Retail (held through a taxable REIT subsidiary) | 3,173 | — | |||||
| Other | (549 | ) | 6,351 | ||||
| (2,788 | ) | 6,351 | |||||
| Noncontrolling interests' share of above adjustments | 193 | (399 | ) | ||||
| Total of certain (income) expense items that impact FFO attributable to common shareholders plus assumed conversions, net | $ | (2,595 | ) | $ | 5,952 | ||
| Per diluted share (non-GAAP) | $ | (0.01 | ) | $ | 0.03 | ||
| FFO attributable to common shareholders plus assumed conversions, as adjusted (non-GAAP) | $ | 152,313 | $ | 124,359 | |||
| Per diluted share (non-GAAP) | $ | 0.79 | $ | 0.65 | |||
____________________________________________________________
(1) See page 8 for a reconciliation of net income attributable to common shareholders to FFO attributable to common shareholders plus assumed conversions (non-GAAP) for the three months ended March 31, 2022 and 2021.
FFO, as Adjusted Bridge - Q1 2022 vs. Q1 2021
The following table bridges our FFO attributable to common shareholders plus assumed conversions, as adjusted (non-GAAP) for the three months ended March 31, 2021 to FFO attributable to common shareholders plus assumed conversions, as adjusted (non-GAAP) for the three months ended March 31, 2022:
| (Amounts in millions, except per share amounts) | FFO, as Adjusted | |||||
| Amount | Per Share | |||||
| FFO attributable to common shareholders plus assumed conversions, as adjusted (non-GAAP) for the three months ended March 31, 2021 | $ | 124.4 | $ | 0.65 | ||
| Increase (decrease) in FFO, as adjusted due to: | ||||||
| Rent commencement and other tenant related items | 14.8 | |||||
| Variable businesses (primarily signage and trade shows) | 11.7 | |||||
| Acquisition of our partner's | 4.6 | |||||
| General and administrative (primarily due to the overhead reduction program) | 2.4 | |||||
| Other, net | (3.2 | ) | ||||
| 30.3 | ||||||
| Noncontrolling interests' share of above items | (2.4 | ) | ||||
| Net increase | 27.9 | 0.14 | ||||
| FFO attributable to common shareholders plus assumed conversions, as adjusted (non-GAAP) for the three months ended March 31, 2022 | $ | 152.3 | $ | 0.79 | ||
See page 8 for a reconciliation of net income attributable to common shareholders to FFO attributable to common shareholders plus assumed conversions (non-GAAP) for the three months ended March 31, 2022 and 2021. Reconciliations of FFO attributable to common shareholders plus assumed conversions to FFO attributable to common shareholders plus assumed conversions, as adjusted are provided above.
Dispositions:
220 CPS
During the three months ended March 31, 2022, we closed on the sale of one condominium unit at 220 CPS for net proceeds of
SoHo Properties
On January 13, 2022, we sold two Manhattan retail properties located at 478-482 Broadway and 155 Spring Street for
Center Building (33-00 Northern Boulevard)
On April 27, 2022, we entered into an agreement to sell the Center Building, an eight-story 498,000 square foot office building located at 33‑00 Northern Boulevard in Long Island City, New York, for
Leasing Activity For the Three Months Ended March 31, 2022:
- 272,000 square feet of New York Office space (236,000 square feet at share) at an initial rent of
$81.07 per square foot and a weighted average lease term of 8.8 years. The changes in the GAAP and cash mark-to-market rent on the 152,000 square feet of second generation space were positive6.5% and positive7.2% , respectively. Tenant improvements and leasing commissions were$12.88 per square foot per annum, or15.9% of initial rent. - 20,000 square feet of New York Retail space (all at share) at an initial rent of
$171.62 per square foot and a weighted average lease term of 14.1 years. The 20,000 square feet was first generation space. Tenant improvements and leasing commissions were$14.01 per square foot per annum, or8.2% of initial rent. - 149,000 square feet at theMART (all at share) at an initial rent of
$49.79 per square foot and a weighted average lease term of 8.2 years. The changes in the GAAP and cash mark-to-market rent on the 133,000 square feet of second generation space were negative7.4% and negative4.5% , respectively. Tenant improvements and leasing commissions were$12.00 per square foot per annum, or24.1% of initial rent. - 56,000 square feet at 555 California (39,000 square feet at share) at an initial rent of
$91.49 per square foot and a weighted average lease term of 6.8 years. The changes in the GAAP and cash mark-to-market rent on the 34,000 square feet of second generation space were positive56.4% and positive19.8% , respectively. Tenant improvements and leasing commissions were$12.50 per square foot per annum, or13.7% of initial rent.
Same Store Net Operating Income ("NOI") At Share:
Below is the percentage increase (decrease) in same store NOI at share and same store NOI at share - cash basis of our New York segment, theMART and 555 California Street.
| Total | New York | theMART | 555 California Street | ||||||||
| Same store NOI at share % increase (decrease)(1): | |||||||||||
| Three months ended March 31, 2022 compared to March 31, 2021 | 3.1 | % | 2.5 | % | 10.0 | % | 3.2 | % | |||
| Three months ended March 31, 2022 compared to December 31, 2021 | (1.5 | )% | (3.2 | )% | 24.8 | % | (2.2 | )% | |||
| Same store NOI at share - cash basis % increase (decrease)(1): | |||||||||||
| Three months ended March 31, 2022 compared to March 31, 2021 | 5.8 | % | 5.0 | % | 14.6 | % | 5.3 | % | |||
| Three months ended March 31, 2022 compared to December 31, 2021 | (1.4 | )% | (3.0 | )% | 11.0 | % | 8.1 | % | |||
____________________
(1) See pages 10 through 13 for same store NOI at share and same store NOI at share - cash basis reconciliations.
NOI At Share:
The elements of our New York and Other NOI at share for the three months ended March 31, 2022 and 2021 and the three months ended December 31, 2021 are summarized below.
| (Amounts in thousands) | For the Three Months Ended | ||||||||
| March 31, | December 31, | ||||||||
| 2022 | 2021 | 2021 | |||||||
| NOI at share: | |||||||||
| New York: | |||||||||
| Office(1) | $ | 177,809 | $ | 166,635 | $ | 179,929 | |||
| Retail | 52,105 | 36,702 | 48,365 | ||||||
| Residential | 4,774 | 4,456 | 4,894 | ||||||
| Alexander's | 8,979 | 10,489 | 8,751 | ||||||
| Hotel Pennsylvania(2) | — | (7,144 | ) | — | |||||
| Total New York | 243,667 | 211,138 | 241,939 | ||||||
| Other: | |||||||||
| theMART | 19,914 | 18,107 | 15,959 | ||||||
| 555 California Street | 16,235 | 16,064 | 16,596 | ||||||
| Other investments | 4,442 | 4,799 | 3,928 | ||||||
| Total Other | 40,591 | 38,970 | 36,483 | ||||||
| NOI at share | $ | 284,258 | $ | 250,108 | $ | 278,422 | |||
_______________________
See notes below.
NOI At Share - Cash Basis:
The elements of our New York and Other NOI at share - cash basis for the three months ended March 31, 2022 and 2021 and the three months ended December 31, 2021 are summarized below.
| (Amounts in thousands) | For the Three Months Ended | ||||||||
| March 31, | December 31, | ||||||||
| 2022 | 2021 | 2021 | |||||||
| NOI at share - cash basis: | |||||||||
| New York: | |||||||||
| Office(1) | $ | 177,827 | $ | 167,096 | $ | 181,568 | |||
| Retail | 47,393 | 34,876 | 44,536 | ||||||
| Residential | 4,689 | 4,011 | 4,758 | ||||||
| Alexander's | 9,783 | 11,349 | 9,538 | ||||||
| Hotel Pennsylvania(2) | — | (7,167 | ) | — | |||||
| Total New York | 239,692 | 210,165 | 240,400 | ||||||
| Other: | |||||||||
| theMART | 20,436 | 17,840 | 18,413 | ||||||
| 555 California Street | 16,360 | 15,855 | 15,128 | ||||||
| Other investments | 4,640 | 5,050 | 4,229 | ||||||
| Total Other | 41,436 | 38,745 | 37,770 | ||||||
| NOI at share - cash basis | $ | 281,128 | $ | 248,910 | $ | 278,170 | |||
______________________
(1) Includes Building Management Services ("BMS") NOI of
(2) On April 5, 2021, we permanently closed the Hotel Pennsylvania. Beginning in the third quarter of 2021, we commenced capitalization of carrying costs in connection with our development of the future PENN 15 (formerly Hotel Pennsylvania) site.
PENN District - Active Development/Redevelopment Summary as of March 31, 2022
| (Amounts in thousands of dollars, except square feet) | |||||||||||||||||
| Active PENN District Projects | Segment | Property Rentable Sq. Ft. | Budget(1) | Cash Amount Expended | Remaining Expenditures | Stabilization Year | Projected Incremental Cash Yield | ||||||||||
| Farley ( | New York | 845,000 | 1,120,000 | (2) | 981,993 | (2) | 138,007 | 2022 | 6.4 | % | |||||||
| PENN 2 - as expanded | New York | 1,795,000 | 750,000 | 208,231 | 541,769 | 2025 | 9.0 | % | |||||||||
| PENN 1 (including LIRR Concourse Retail)(3) | New York | 2,547,000 | 450,000 | 319,622 | 130,378 | N/A | 12.2 | % | (3)(4) | ||||||||
| Districtwide Improvements | New York | N/A | 100,000 | 32,306 | 67,694 | N/A | N/A | ||||||||||
| Total Active PENN District Projects | 2,420,000 | 1,542,152 | 877,848 | 8.0 | % | ||||||||||||
________________________________
(1) Excluding debt and equity carry.
(2) Net of 154,000 of historic tax credit investor contributions, of which 88,000 has been funded to date (at our
(3) Property is ground leased through 2098, as fully extended. Fair market value resets occur in 2023, 2048 and 2073. The
(4) Projected to be achieved as pre-redevelopment leases roll; approximate average remaining lease term 4.0 years.
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.
Conference Call and Audio Webcast
As previously announced, the Company will host a quarterly earnings conference call and an audio webcast on Tuesday, May 3, 2022 at 10:00 a.m. Eastern Time (ET). The conference call can be accessed by dialing 866-374-5140 (domestic) or 404-400-0571 (international) and entering the passcode 45364290. A live webcast of the conference call will be available on Vornado’s website at www.vno.com in the Investor Relations section and an online playback of the webcast will be available on the website following the conference call.
Contact
Thomas J. Sanelli
(212) 894-7000
Supplemental Financial Information
Further details regarding results of operations, properties and tenants can be accessed at the Company’s website www.vno.com. Vornado Realty Trust is a fully - integrated equity real estate investment trust.
Certain statements contained herein may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not guarantees of performance. They represent our intentions, plans, expectations and beliefs and are subject to numerous assumptions, risks and uncertainties. Our future results, financial condition and business may differ materially from those expressed in these forward-looking statements. You can find many of these statements by looking for words such as "approximates," "believes," "expects," "anticipates," "estimates," "intends," "plans," "would," "may" or other similar expressions in this press release. We also note the following forward-looking statements: in the case of our development and redevelopment projects, the estimated completion date, estimated project cost, projected incremental cash yield, stabilization date and cost to complete; and estimates of future capital expenditures, dividends to common and preferred shareholders and operating partnership distributions. For a discussion of factors that could materially affect the outcome of our forward-looking statements and our future results and financial condition, see “Risk Factors” in Part I, Item 1A, of our Annual Report on Form 10-K for the year ended December 31, 2021. Currently, one of the most significant factors is the ongoing adverse effect of the COVID-19 pandemic on our business, financial condition, results of operations, cash flows, operating performance and the effect it has had and may continue to have on our tenants, the global, national, regional and local economies and financial markets and the real estate market in general. The extent of the impact of the COVID-19 pandemic will continue to depend on future developments, including vaccination rates among the population, the efficacy and durability of vaccines against emerging variants, and governmental and tenant responses thereto, which continue to be uncertain but the impact could be material. Moreover, you are cautioned that the COVID-19 pandemic will heighten many of the risks identified in "Item 1A. Risk Factors" in Part I of our Annual Report on Form 10-K for the year ended December 31, 2021.
VORNADO REALTY TRUST
CONSOLIDATED BALANCE SHEETS
| (Amounts in thousands) | As of | Increase | ||||||||||
| March 31, 2022 | December 31, 2021 | (Decrease) | ||||||||||
| ASSETS | ||||||||||||
| Real estate, at cost: | ||||||||||||
| Land | $ | 2,540,193 | $ | 2,540,193 | $ | — | ||||||
| Buildings and improvements | 9,956,681 | 9,839,166 | 117,515 | |||||||||
| Development costs and construction in progress | 751,555 | 718,694 | 32,861 | |||||||||
| Leasehold improvements and equipment | 120,979 | 119,792 | 1,187 | |||||||||
| Total | 13,369,408 | 13,217,845 | 151,563 | |||||||||
| Less accumulated depreciation and amortization | (3,455,145 | ) | (3,376,347 | ) | (78,798 | ) | ||||||
| Real estate, net | 9,914,263 | 9,841,498 | 72,765 | |||||||||
| Right-of-use assets | 687,642 | 337,197 | 350,445 | (1) | ||||||||
| Cash, cash equivalents, restricted cash and investments in U.S. Treasury bills: | ||||||||||||
| Cash and cash equivalents | 973,858 | 1,760,225 | (786,367 | ) | ||||||||
| Restricted cash | 167,397 | 170,126 | (2,729 | ) | ||||||||
| Investments in U.S. Treasury bills | 645,360 | — | 645,360 | |||||||||
| Total | 1,786,615 | 1,930,351 | (143,736 | ) | ||||||||
| Tenant and other receivables | 83,126 | 79,661 | 3,465 | |||||||||
| Investments in partially owned entities | 3,299,629 | 3,297,389 | 2,240 | |||||||||
| Real estate fund investments | 13,402 | 7,730 | 5,672 | |||||||||
| 220 CPS condominium units ready for sale | 51,072 | 57,142 | (6,070 | ) | ||||||||
| Receivable arising from the straight-lining of rents | 677,627 | 656,318 | 21,309 | |||||||||
| Deferred leasing costs, net | 388,724 | 391,693 | (2,969 | ) | ||||||||
| Identified intangible assets, net | 149,613 | 154,895 | (5,282 | ) | ||||||||
| Other assets | 440,648 | 512,714 | (72,066 | ) | ||||||||
| Total assets | $ | 17,492,361 | $ | 17,266,588 | $ | 225,773 | ||||||
| LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY | ||||||||||||
| Liabilities: | ||||||||||||
| Mortgages payable, net | $ | 6,050,693 | $ | 6,053,343 | $ | (2,650 | ) | |||||
| Senior unsecured notes, net | 1,190,301 | 1,189,792 | 509 | |||||||||
| Unsecured term loan, net | 798,075 | 797,812 | 263 | |||||||||
| Unsecured revolving credit facilities | 575,000 | 575,000 | — | |||||||||
| Lease liabilities | 723,432 | 370,206 | 353,226 | (1) | ||||||||
| Accounts payable and accrued expenses | 541,825 | 613,497 | (71,672 | ) | ||||||||
| Deferred revenue | 46,238 | 48,118 | (1,880 | ) | ||||||||
| Deferred compensation plan | 107,170 | 110,174 | (3,004 | ) | ||||||||
| Other liabilities | 274,496 | 304,725 | (30,229 | ) | ||||||||
| Total liabilities | 10,307,230 | 10,062,667 | 244,563 | |||||||||
| Redeemable noncontrolling interests | 747,161 | 688,683 | 58,478 | |||||||||
| Shareholders' equity | 6,184,858 | 6,236,346 | (51,488 | ) | ||||||||
| Noncontrolling interests in consolidated subsidiaries | 253,112 | 278,892 | (25,780 | ) | ||||||||
| Total liabilities, redeemable noncontrolling interests and equity | $ | 17,492,361 | $ | 17,266,588 | $ | 225,773 | ||||||
____________________________________________________________
(1) In January 2022, we exercised a 25-year renewal option on our PENN 1 ground lease extending the term through June 2073. As a result of the exercise, we remeasured the related ground lease liability to include our 25-year extension option and recorded an estimated incremental right-of-use asset and lease liability of approximately
VORNADO REALTY TRUST
OPERATING RESULTS
| (Amounts in thousands, except per share amounts) | For the Three Months Ended March 31, | ||||||
| 2022 | 2021 | ||||||
| Revenues | $ | 442,130 | $ | 379,977 | |||
| Net income | $ | 53,375 | $ | 26,993 | |||
| Less net income attributable to noncontrolling interests in: | |||||||
| Consolidated subsidiaries | (9,374 | ) | (6,114 | ) | |||
| Operating Partnership | (1,994 | ) | (329 | ) | |||
| Net income attributable to Vornado | 42,007 | 20,550 | |||||
| Preferred share dividends | (15,529 | ) | (16,467 | ) | |||
| Net income attributable to common shareholders | $ | 26,478 | $ | 4,083 | |||
| Income per common share - basic: | |||||||
| Net income per common share | $ | 0.14 | $ | 0.02 | |||
| Weighted average shares outstanding | 191,724 | 191,418 | |||||
| Income per common share - diluted: | |||||||
| Net income per common share | $ | 0.14 | $ | 0.02 | |||
| Weighted average shares outstanding | 192,038 | 192,031 | |||||
| FFO attributable to common shareholders plus assumed conversions (non-GAAP) | $ | 154,908 | $ | 118,407 | |||
| Per diluted share (non-GAAP) | $ | 0.80 | $ | 0.62 | |||
| FFO attributable to common shareholders plus assumed conversions, as adjusted (non-GAAP) | $ | 152,313 | $ | 124,359 | |||
| Per diluted share (non-GAAP) | $ | 0.79 | $ | 0.65 | |||
| Weighted average shares used in determining FFO attributable to common shareholders plus assumed conversions per diluted share | 193,174 | 192,057 | |||||
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, real estate impairment losses, 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 they exclude 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. The Company also uses FFO attributable to common shareholders plus assumed conversions, as adjusted for certain items that impact the comparability of period to period FFO, as one of several criteria to determine performance-based compensation for members of its senior management. 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. In addition to FFO attributable to common shareholders plus assumed conversions, we also disclose FFO attributable to common shareholders plus assumed conversions, as adjusted. Although this non-GAAP measure clearly differs from NAREIT’s definition of FFO, we believe it provides a meaningful presentation of operating performance. Reconciliations of net income attributable to common shareholders to FFO attributable to common shareholders plus assumed conversions are provided on the following page. Reconciliations of FFO attributable to common shareholders plus assumed conversions to FFO attributable to common shareholders plus assumed conversions, as adjusted are provided on page 2 of this press release.
VORNADO REALTY TRUST
NON-GAAP RECONCILIATIONS
The following table reconciles net income attributable to common shareholders to FFO attributable to common shareholders plus assumed conversions:
| (Amounts in thousands, except per share amounts) | For the Three Months Ended March 31, | ||||||
| 2022 | 2021 | ||||||
| Net income attributable to common shareholders | $ | 26,478 | $ | 4,083 | |||
| Per diluted share | $ | 0.14 | $ | 0.02 | |||
| FFO adjustments: | |||||||
| Depreciation and amortization of real property | $ | 105,962 | $ | 87,719 | |||
| Net gain on sale of real estate | (551 | ) | — | ||||
| Proportionate share of adjustments to equity in net income of partially owned entities to arrive at FFO: | |||||||
| Depreciation and amortization of real property | 32,139 | 34,858 | |||||
| Increase in fair value of marketable securities | — | (189 | ) | ||||
| 137,550 | 122,388 | ||||||
| Noncontrolling interests' share of above adjustments | (9,506 | ) | (8,075 | ) | |||
| FFO adjustments, net | $ | 128,044 | $ | 114,313 | |||
| FFO attributable to common shareholders | $ | 154,522 | $ | 118,396 | |||
| Impact of assumed conversion of dilutive convertible securities | 386 | 11 | |||||
| FFO attributable to common shareholders plus assumed conversions | $ | 154,908 | $ | 118,407 | |||
| Per diluted share | $ | 0.80 | $ | 0.62 | |||
| Reconciliation of weighted average shares outstanding: | |||||||
| Weighted average common shares outstanding | 191,724 | 191,418 | |||||
| Effect of dilutive securities: | |||||||
| Convertible securities | 1,136 | (1) | 26 | ||||
| Share-based payment awards | 314 | 613 | |||||
| Denominator for FFO per diluted share | 193,174 | 192,057 | |||||
______________________
(1) On January 1, 2022, we adopted Accounting Standards Update 2020-06, which requires us to include our Series D-13 cumulative redeemable preferred units and Series G-1 through G-4 convertible preferred units in our dilutive earnings per share calculations, if the effect is dilutive.
VORNADO REALTY TRUST
NON-GAAP RECONCILIATIONS - CONTINUED
Below is a reconciliation of net income to NOI at share and NOI at share - cash basis for the three months ended March 31, 2022 and 2021 and the three months ended December 31, 2021.
| For the Three Months Ended | |||||||||||
| (Amounts in thousands) | March 31, | December 31, | |||||||||
| 2022 | 2021 | 2021 | |||||||||
| Net income | $ | 53,375 | $ | 26,993 | $ | 31,963 | |||||
| Depreciation and amortization expense | 117,443 | 95,354 | 126,349 | ||||||||
| General and administrative expense | 41,216 | 44,186 | 34,204 | ||||||||
| Transaction related costs and other | 1,005 | 843 | 3,185 | ||||||||
| Income from partially owned entities | (33,714 | ) | (29,073 | ) | (43,749 | ) | |||||
| (Income) loss from real estate fund investments | (5,674 | ) | 169 | (5,959 | ) | ||||||
| Interest and other investment income, net | (1,018 | ) | (1,522 | ) | (918 | ) | |||||
| Interest and debt expense | 52,109 | 50,064 | 78,192 | ||||||||
| Net gains on disposition of wholly owned and partially owned assets | (6,552 | ) | — | (14,959 | ) | ||||||
| Income tax expense | 7,411 | 1,984 | 10,055 | ||||||||
| NOI from partially owned entities | 78,692 | 78,756 | 79,223 | ||||||||
| NOI attributable to noncontrolling interests in consolidated subsidiaries | (20,035 | ) | (17,646 | ) | (19,164 | ) | |||||
| NOI at share | 284,258 | 250,108 | 278,422 | ||||||||
| Non-cash adjustments for straight-line rents, amortization of acquired below-market leases, net and other | (3,130 | ) | (1,198 | ) | (252 | ) | |||||
| NOI at share - cash basis | $ | 281,128 | $ | 248,910 | $ | 278,170 | |||||
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, net and other non-cash adjustments. We consider NOI at share - cash basis to be the primary non-GAAP financial measure for making decisions and assessing the unlevered performance of our segments as it relates to the total return on assets as opposed to the levered return on equity. 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.
VORNADO REALTY TRUST
NON-GAAP RECONCILIATIONS - CONTINUED
Below are reconciliations of NOI at share to same store NOI at share for our New York segment, theMART, 555 California Street and other investments for the three months ended March 31, 2022 compared to March 31, 2021.
| (Amounts in thousands) | Total | New York | theMART | 555 California Street | Other | ||||||||||||||
| NOI at share for the three months ended March 31, 2022 | $ | 284,258 | $ | 243,667 | $ | 19,914 | $ | 16,235 | $ | 4,442 | |||||||||
| Less NOI at share from: | |||||||||||||||||||
| Change in ownership interest in One Park Avenue | (5,956 | ) | (5,956 | ) | — | — | — | ||||||||||||
| Dispositions | 78 | 78 | — | — | — | ||||||||||||||
| Development properties | (20,860 | ) | (20,860 | ) | — | — | — | ||||||||||||
| Other non-same store income, net | (6,454 | ) | (2,012 | ) | — | — | (4,442 | ) | |||||||||||
| Same store NOI at share for the three months ended March 31, 2022 | $ | 251,066 | $ | 214,917 | $ | 19,914 | $ | 16,235 | $ | — | |||||||||
| NOI at share for the three months ended March 31, 2021 | $ | 250,108 | $ | 211,138 | $ | 18,107 | $ | 16,064 | $ | 4,799 | |||||||||
| Less NOI at share from: | |||||||||||||||||||
| Dispositions | 741 | 741 | — | — | — | ||||||||||||||
| Development properties | (7,839 | ) | (7,514 | ) | — | (325 | ) | — | |||||||||||
| Hotel Pennsylvania | 7,144 | 7,144 | — | — | — | ||||||||||||||
| Other non-same store income, net | (6,694 | ) | (1,895 | ) | — | — | (4,799 | ) | |||||||||||
| Same store NOI at share for the three months ended March 31, 2021 | $ | 243,460 | $ | 209,614 | $ | 18,107 | $ | 15,739 | $ | — | |||||||||
| Increase in same store NOI at share | $ | 7,606 | $ | 5,303 | $ | 1,807 | $ | 496 | $ | — | |||||||||
| % increase in same store NOI at share | 3.1 | % | 2.5 | % | 10.0 | % | 3.2 | % | 0.0 | % | |||||||||
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, net and other non-cash adjustments. We present 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.
VORNADO REALTY TRUST
NON-GAAP RECONCILIATIONS - CONTINUED
Below are reconciliations of NOI at share - cash basis to same store NOI at share - cash basis for our New York segment, theMART, 555 California Street and other investments for the three months ended March 31, 2022 compared to March 31, 2021.
| (Amounts in thousands) | Total | New York | theMART | 555 California Street | Other | ||||||||||||||
| NOI at share - cash basis for the three months ended March 31, 2022 | $ | 281,128 | $ | 239,692 | $ | 20,436 | $ | 16,360 | $ | 4,640 | |||||||||
| Less NOI at share - cash basis from: | |||||||||||||||||||
| Change in ownership interest in One Park Avenue | (4,779 | ) | (4,779 | ) | — | — | — | ||||||||||||
| Dispositions | 75 | 75 | — | — | — | ||||||||||||||
| Development properties | (13,929 | ) | (13,929 | ) | — | — | — | ||||||||||||
| Other non-same store income, net | (7,094 | ) | (2,454 | ) | — | — | (4,640 | ) | |||||||||||
| Same store NOI at share - cash basis for the three months ended March 31, 2022 | $ | 255,401 | $ | 218,605 | $ | 20,436 | $ | 16,360 | $ | — | |||||||||
| NOI at share - cash basis for the three months ended March 31, 2021 | $ | 248,910 | $ | 210,165 | $ | 17,840 | $ | 15,855 | $ | 5,050 | |||||||||
| Less NOI at share - cash basis from: | |||||||||||||||||||
| Dispositions | 1,353 | 1,353 | — | — | — | ||||||||||||||
| Development properties | (8,794 | ) | (8,469 | ) | — | (325 | ) | — | |||||||||||
| Hotel Pennsylvania | 7,167 | 7,167 | — | — | — | ||||||||||||||
| Other non-same store income, net | (7,167 | ) | (2,117 | ) | — | — | (5,050 | ) | |||||||||||
| Same store NOI at share - cash basis for the three months ended March 31, 2021 | $ | 241,469 | $ | 208,099 | $ | 17,840 | $ | 15,530 | $ | — | |||||||||
| Increase in same store NOI at share - cash basis | $ | 13,932 | $ | 10,506 | $ | 2,596 | $ | 830 | $ | — | |||||||||
| % increase in same store NOI at share - cash basis | 5.8 | % | 5.0 | % | 14.6 | % | 5.3 | % | 0.0 | % | |||||||||
VORNADO REALTY TRUST
NON-GAAP RECONCILIATIONS - CONTINUED
Below are reconciliations of NOI at share to same store NOI at share for our New York segment, theMART, 555 California Street and other investments for the three months ended March 31, 2022 compared to December 31, 2021.
| (Amounts in thousands) | Total | New York | theMART | 555 California Street | Other | ||||||||||||||
| NOI at share for the three months ended March 31, 2022 | $ | 284,258 | $ | 243,667 | $ | 19,914 | $ | 16,235 | $ | 4,442 | |||||||||
| Less NOI at share from: | |||||||||||||||||||
| Dispositions | 78 | 78 | — | — | — | ||||||||||||||
| Development properties | (21,053 | ) | (21,053 | ) | — | — | — | ||||||||||||
| Other non-same store income, net | (6,146 | ) | (1,704 | ) | — | — | (4,442 | ) | |||||||||||
| Same store NOI at share for the three months ended March 31, 2022 | $ | 257,137 | $ | 220,988 | $ | 19,914 | $ | 16,235 | $ | — | |||||||||
| NOI at share for the three months ended December 31, 2021 | $ | 278,422 | $ | 241,939 | $ | 15,959 | $ | 16,596 | $ | 3,928 | |||||||||
| Less NOI at share from: | |||||||||||||||||||
| Dispositions | (220 | ) | (220 | ) | — | — | — | ||||||||||||
| Development properties | (10,475 | ) | (10,475 | ) | — | — | — | ||||||||||||
| Other non-same store income, net | (6,769 | ) | (2,841 | ) | — | — | (3,928 | ) | |||||||||||
| Same store NOI at share for the three months ended December 31, 2021 | $ | 260,958 | $ | 228,403 | $ | 15,959 | $ | 16,596 | $ | — | |||||||||
| (Decrease) increase in same store NOI at share | $ | (3,821 | ) | $ | (7,415 | ) | $ | 3,955 | $ | (361 | ) | $ | — | ||||||
| % (decrease) increase in same store NOI at share | (1.5 | )% | (3.2 | )% | 24.8 | % | (2.2 | )% | 0.0 | % | |||||||||
VORNADO REALTY TRUST
NON-GAAP RECONCILIATIONS - CONTINUED
Below are reconciliations of NOI at share - cash basis to same store NOI at share - cash basis for our New York segment, theMART, 555 California Street and other investments for the three months ended March 31, 2022 compared to December 31, 2021.
| (Amounts in thousands) | Total | New York | theMART | 555 California Street | Other | ||||||||||||||
| NOI at share - cash basis for the three months ended March 31, 2022 | $ | 281,128 | $ | 239,692 | $ | 20,436 | $ | 16,360 | $ | 4,640 | |||||||||
| Less NOI at share - cash basis from: | |||||||||||||||||||
| Dispositions | 75 | 75 | — | — | — | ||||||||||||||
| Development properties | (14,126 | ) | (14,126 | ) | — | — | — | ||||||||||||
| Other non-same store income, net | (6,786 | ) | (2,146 | ) | — | — | (4,640 | ) | |||||||||||
| Same store NOI at share - cash basis for the three months ended March 31, 2022 | $ | 260,291 | $ | 223,495 | $ | 20,436 | $ | 16,360 | $ | — | |||||||||
| NOI at share - cash basis for the three months ended December 31, 2021 | $ | 278,170 | $ | 240,400 | $ | 18,413 | $ | 15,128 | $ | 4,229 | |||||||||
| Less NOI at share - cash basis from: | |||||||||||||||||||
| Dispositions | (241 | ) | (241 | ) | — | — | — | ||||||||||||
| Development properties | (6,222 | ) | (6,222 | ) | — | — | — | ||||||||||||
| Other non-same store income, net | (7,847 | ) | (3,618 | ) | — | — | (4,229 | ) | |||||||||||
| Same store NOI at share - cash basis for the three months ended December 31, 2021 | $ | 263,860 | $ | 230,319 | $ | 18,413 | $ | 15,128 | $ | — | |||||||||
| (Decrease) increase in same store NOI at share - cash basis | $ | (3,569 | ) | $ | (6,824 | ) | $ | 2,023 | $ | 1,232 | $ | — | |||||||
| % (decrease) increase in same store NOI at share - cash basis | (1.4 | )% | (3.0 | )% | 11.0 | % | 8.1 | % | 0.0 | % | |||||||||
FAQ
What were Vornado Realty Trust's earnings for Q1 2022?
How did Vornado's FFO change in Q1 2022 compared to Q1 2021?
What leasing activity did Vornado report for Q1 2022?
What property sales did Vornado Realty Trust announce in May 2022?
