What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2023-07-31 compared with 2023-05-01 · 113 added, 80 removed, 292 unchanged (40% of the section changed)

4 unchanged sentences

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

ASSETS March 31, 2023 December 31, 2022

ASSETS June 30, 2023 December 31, 2022

Real estate, at cost:

14 unchanged sentences

26,481 28,490

Asset held for sale 13,794 —

Other assets 58,043 67,313

30 unchanged sentences

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

For the Three Months Ended March 31,

For the Three Months Ended June 30, For the Six Months Ended June 30,

2023 2022 2023 2022

Rental revenues $ 53,673 $ 49,824 $ 106,614 $ 99,039

2 unchanged sentences

Depreciation and amortization ( 8,081 ) ( 7,413 ) ( 15,559 ) ( 14,764 )

General and administrative, including management fees to Vornado of $ 610 in each period

G eneral and administrative, including management fees to Vornado of $ 610 , $ 610 , $ 1,220 and $ 1,220 , respectively

( 1,906 ) ( 1,916 ) ( 3,265 ) ( 3,385 )

2 unchanged sentences

Interest and debt expense ( 13,196 ) ( 5,482 ) ( 25,449 ) ( 9,897 )

Net gain on sale of real estate 53,952 — 53,952 —

Net income $ 64,147 $ 14,814 $ 75,373 $ 29,346

6 unchanged sentences

(Amounts in thousands)

For the Three Months Ended March 31,

For the Three Months Ended June 30, For the Six Months Ended June 30,

2023 2022 2023 2022

Net income $ 64,147 $ 14,814 $ 75,373 $ 29,346

Other comprehensive (loss) income:

Other comprehensive income (loss):

Change in fair value of interest rate derivatives and other 3,110 1,924 ( 534 ) 13,651

10 unchanged sentences

Shares Amount

For the Three Months Ended March 31, 2023

Balance, December 31, 2022 5,173 $ 5,173 $ 33,865 $ 172,243 $ 25,586 $ ( 368 ) $ 236,499

For the Three Months Ended June 30, 2023

Balance, March 31, 2023 5,173 $ 5,173 $ 33,865 $ 160,397 $ 21,942 $ ( 368 ) $ 221,009

Net income — — — 64,147 — — 64,147

2 unchanged sentences

Change in fair value of interest rate derivatives and other — — — — 3,110 — 3,110

Deferred stock unit grants — — 450 — — — 450

Balance, June 30, 2023 5,173 $ 5,173 $ 34,315 $ 201,472 $ 25,052 $ ( 368 ) $ 265,644

For the Three Months Ended June 30, 2022

Balance, March 31, 2022 5,173 $ 5,173 $ 33,415 $ 198,347 $ 19,221 $ ( 368 ) $ 255,788

For the Three Months Ended March 31, 2022

Net income — — — 14,814 — — 14,814

Dividends paid ($ 4.50 per common share)

— — — ( 23,060 ) — — ( 23,060 )

Change in fair value of interest rate derivatives and other — — — — 1,924 — 1,924

Deferred stock unit grants — — 450 — — — 450

Balance, June 30, 2022 5,173 $ 5,173 $ 33,865 $ 190,101 $ 21,145 $ ( 368 ) $ 249,916

Capital Retained

Earnings Accumulated

Comprehensive Income Treasury

Stock Total Equity

Shares Amount

For the Six Months Ended June 30, 2023

Balance, December 31, 2022 5,173 $ 5,173 $ 33,865 $ 172,243 $ 25,586 $ ( 368 ) $ 236,499

2 unchanged sentences

— — — ( 46,144 ) — — ( 46,144 )

Change in fair value of interest rate derivatives — — — — 11,727 — 11,727

Balance, March 31, 2022 5,173 $ 5,173 $ 33,415 $ 198,347 $ 19,221 $ ( 368 ) $ 255,788

Change in fair value of interest rate derivatives and other — — — — ( 534 ) — ( 534 )

Deferred stock unit grants — — 450 — — — 450

Balance, June 30, 2023 5,173 $ 5,173 $ 34,315 $ 201,472 $ 25,052 $ ( 368 ) $ 265,644

For the Six Months Ended June 30, 2022

Balance, December 31, 2021 5,173 $ 5,173 $ 33,415 $ 206,875 $ 7,494 $ ( 368 ) $ 252,589

Net income — — — 29,346 — — 29,346

Dividends paid ($ 9.00 per common share)

— — — ( 46,120 ) — — ( 46,120 )

Change in fair value of interest rate derivatives and other — — — — 13,651 — 13,651

Deferred stock unit grants — — 450 — — — 450

Balance, June 30, 2022 5,173 $ 5,173 $ 33,865 $ 190,101 $ 21,145 $ ( 368 ) $ 249,916

See notes to consolidated financial statements (unaudited).

3 unchanged sentences

(Amounts in thousands)

For the Three Months Ended March 31,

For the Six Months Ended June 30,

CASH FLOWS FROM OPERATING ACTIVITIES 2023 2022

2 unchanged sentences

Depreciation and amortization, including amortization of debt issuance costs 16,399 15,587

Net gain on sale of real estate ( 53,952 ) —

Straight-lining of rents 4,169 3,948

Stock-based compensation expense 450 450

Other non-cash adjustments 4,431 ( 611 )

8 unchanged sentences

Construction in progress and real estate additions ( 2,894 ) ( 3,800 )

Proceeds from sale of real estate 67,821 —

Proceeds from maturities of U.S.

Treasury bills 264,881 —

Purchase of interest rate cap ( 11,258 ) —

Purchase of U.S.

Treasury bills — ( 197,407 )

Net cash provided by (used in) investing activities 318,550 ( 201,207 )

3 unchanged sentences

Net cash used in financing activities ( 46,182 ) ( 46,128 )

Net increase in cash and cash equivalents and restricted cash 162,398 7,967

Net increase (decrease) in cash and cash equivalents and restricted cash 338,277 ( 154,007 )

Cash and cash equivalents and restricted cash at beginning of period 214,478 483,505

8 unchanged sentences

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

Cash payments for interest, net of amounts capitalized in 2022 $ 11,476 $ 3,728

Cash payments for interest (net of amounts capitalized) $ 23,761 $ 8,540

NON-CASH TRANSACTIONS

Liability for real estate additions, including $ 3 for development fees due

Liability for real estate additions, includi ng $ 3 for development fees due

to Vornado in 2022

1 unchanged sentence

Write-off of fully depreciated assets 5,808 23

Reclassification of asset held for sale 13,794 —

See notes to consolidated financial statements (unaudited).

7 unchanged sentences

We are managed by, and our properties are leased and developed by, Vornado Realty Trust (“Vornado”) (NYSE:

We have six properties in New York City.

We have five properties in New York City.

Basis of Presentation

5 unchanged sentences

Actual results could differ from those estimates.

The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the operating results for the full year.

The results of operations for the three and six months ended June 30, 2023 are not necessarily indicative of the operating results for the full year.

We operate in one reportable segment.

Recently Issued Accounting Literature

In March 2020, the Financial Accounting Standards Board (“FASB”) issued an update (“ASU 2020-04”) establishing Accounting Standards Codification (“ASC”) Topic 848 (“ASC 848”), Reference Rate Reform.

ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts.

The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur.

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04 establishing Accounting Standards Codification (“ASC”) Topic 848, Reference Rate Reform, and in January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848) :

Scope (collectively, “ASC 848”).

ASC 848 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts.

The guidance in ASC 848 is optional and may be elected over time as reference rate reform activities occur.

We have elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives.

Application of these expedients preserves the presentation of derivatives consistent with past presentation.

In December 2022 the FASB issued accounting standard update 2022-06 that defers the sunset of ASC 848 from December 31, 2022 to December 31, 2024.

We continue to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur.

In December 2022, the FASB issued ASU 2022-06, Deferral of the Sunset Date of Topic 848 (“ASU 2022-06”) which was issued to defer the sunset date of ASC 848 to December 31, 2024.

ASU 2022-06 is effective immediately for all companies.

As of June 30, 2023, we have transitioned all of our LIBOR-indexed debt and derivatives and, for our derivatives in hedge accounting relationships, utilized the elective relief in ASC 848, allowing for the continuation of hedge accounting through the transition process.

ALEXANDER’S, INC.

2 unchanged sentences

Revenue Recognition

The following is a summary of revenue sources for the three months ended March 31, 2023 and 2022.

For the Three Months Ended March 31,

The following is a summary of revenue sources for the three and six months ended June 30, 2023 and 2022.

For the Three Months Ended June 30, For the Six Months Ended June 30,

(Amounts in thousands) 2023 2022 2023 2022

3 unchanged sentences

Rental revenues $ 53,673 $ 49,824 $ 106,614 $ 99,039

The components of lease revenues for the three months ended March 31, 2023 and 2022 are as follows:

For the Three Months Ended March 31,

The components of lease revenues for the three and six months ended June 30, 2023 and 2022 are as follows:

For the Three Months Ended June 30, For the Six Months Ended June 30,

(Amounts in thousands) 2023 2022 2023 2022

3 unchanged sentences

Bloomberg L.P.

(“Bloomberg”) accounted for revenue of $ 29,516,000 and $ 27,518,000 for the three months ended March 31, 2023 and 2022, respectively, representing approximately 56 % of our rental revenues in each period.

(“Bloomberg”) accounted for revenue of $ 59,177,000 and $ 55,909,000 for the six months ended June 30, 2023 and 2022, respectively, representing approximately 56 % of our rental revenues in each period.

No other tenant accounted for more than 10% of our rental revenues.

2 unchanged sentences

In addition, we access and evaluate financial information regarding Bloomberg from other private sources, as well as publicly available data.

Asset Held For Sale

On March 8, 2023, we entered into an agreement to sell the Rego Park III land parcel in Queens, New York, for $ 71,060,000 inclusive of consideration for Brownfield tax benefits and reimbursement of costs for plans, specifications and improvements to date.

The sale, which is subject to customary closing conditions, is expected to be completed in the second quarter of 2023.

The financial statement gain will be approximately $ 54,000,000 .

As of March 31, 2023, the $ 13,794,000 carrying value of the property was classified as "Asset held for sale" on our consolidated balance sheets.

Real Estate Sale

On May 19, 2023, we sold the Rego Park III land parcel in Queens, New York, for $ 71,060,000 inclusive of consideration for Brownfield tax benefits and reimbursement of costs for plans, specifications and improvements to date.

Net proceeds from the sale were $ 67,821,000 after closing costs and the financial statement gain was $ 53,952,000 .

ALEXANDER’S, INC.

2 unchanged sentences

Related Party Transactions

As of March 31, 2023, Vornado owned 32.4 % of our outstanding common stock.

As of June 30, 2023, Vornado owned 32.4 % of our outstanding common stock.

We are managed by, and our properties are leased and developed by, Vornado, pursuant to the agreements described below, which expire in March of each year and are automatically renewable.

5 unchanged sentences

In the event third-party real estate brokers are used, the fees to Vornado increase by 1 % and Vornado is responsible for the fees to the third-party real estate brokers.

Vornado is also entitled to a commission upon the sale of any of our assets equal to 3 % of gross proceeds, as defined, for asset sales less than $ 50,000,000 and 1 % of gross proceeds, as defined, for asset sales of $ 50,000,000 or more.

Pursuant to the Sales Agreement, we paid a $ 711,000 sales commission to Vornado in the second quarter of 2023 related to the sale of the Rego Park III land parcel.

We also have agreements with Building Maintenance Services LLC, a wholly owned subsidiary of Vornado, to supervise (i) cleaning, engineering and security services at our 731 Lexington Avenue property and (ii) security services at our Rego Park I and Rego Park II properties and The Alexander apartment tower.

The following is a summary of fees incurred to Vornado under the various agreements discussed above.

For the Three Months Ended March 31,

For the Three Months Ended June 30, For the Six Months Ended June 30,

(Amounts in thousands) 2023 2022 2023 2022

2 unchanged sentences

Leasing fees 129 — 170 1,318

Commission on sale of real estate 711 — 711 —

Property management, cleaning, engineering and security fees

1,550 1,547 2,959 2,816

As of March 31, 2023, the amounts due to Vornado were $ 675,000 for management, property management, cleaning, engineering and security fees.

$ 3,090 $ 2,247 $ 5,240 $ 5,537

As of June 30, 2023, the amounts due to Vornado were $ 823,000 for management, property management, cleaning, engineering and security fees and $ 129,000 for leasing fees.

As of December 31, 2022, the amounts due to Vornado were $ 742,000 for management, property management, cleaning, engineering and security fees and $ 59,000 for leasing fees.

3 unchanged sentences

Mortgages Payable

The following is a summary of our outstanding mortgages payable as of March 31, 2023 and December 31, 2022.

On June 9, 2023, we exercised our remaining one-year extension option on the $ 500,000,000 interest-only mortgage loan on the office condominium of our 731 Lexington Avenue property.

The interest rate on the loan remained at LIBOR plus 0.90 % through July 15, 2023 and then is at the Prime Rate through loan maturity on June 11, 2024.

In addition, in June 2023, we purchased an interest rate cap for $ 11,258,000 , which capped LIBOR at 6.00 % through July 15, 2023 and then the Prime Rate ( 8.25 % as of June 30, 2023) at 6.00 % through loan maturity.

The following is a summary of our outstanding mortgages payable as of June 30, 2023 and December 31, 2022.

We may refinance our maturing debt as it comes due or choose to pay it down.

Interest Rate at March 31, 2023 Balance at

(Amounts in thousands) Maturity March 31, 2023 December 31, 2022

Interest Rate at June 30, 2023 Balance as of

(Amounts in thousands) Maturity June 30, 2023 December 31, 2022

First mortgages secured by:

8 unchanged sentences

Total 1,096,544 1,096,544

Deferred debt issuance costs, net of accumulated amortization of $ 16,458 and $ 16,071 , respectively

Deferred debt issuance costs, net of accumulated

amortization of $ 16,842 and $ 16,071 , respectively

( 4,757 ) ( 5,493 )

$ 1,091,787 $ 1,091,051

(1) Interest rate listed represents the rate in effect as of March 31, 2023 based on LIBOR or SOFR as of contractual reset date plus contractual spread, adjusted for hedging instruments as applicable.

(2) Interest at LIBOR plus 0.90 % (LIBOR capped at a r ate of 6.00 % thr ough June 2023).

Maturity represents the extended maturity based on our one-year as-of right extension option.

The interest rate of the loan will be equal to the Prime rate ( 8.00 % as of March 31, 2023) during the one-year extension period beginning June 2023.

(1) Interest rate listed represents the rate in effect as of June 30, 2023 based on LIBOR or SOFR as of contractual reset date plus contractual spread, adjusted for hedging instruments as applicable.

(2) Interest at LIBOR plus 0.90 % through July 15, 2023 (LIBOR was capped at 6.00 % through July 15, 2023) and then at the Prime Rate (capped at 6.00 % through loan maturity).

(3) Interest at SOFR plus 1.51 % which was swapped to a fixed rate of 1.76 % through May 2025.

(4) Interest at SOFR plus 1.45 % (SOFR is capped at a rate of 4.15 % thr ough November 2024).

(4) Interest at SOFR plus 1.45 % (SOFR is capped at 4.15 % through November 2024).

Stock-Based Compensation

We account for stock-based compensation in accordance with ASC Topic 718, Compensation – Stock Compensation (“ASC 718”).

Our 2016 Omnibus Stock Plan (the “Plan”) provides for grants of incentive and non-qualified stock options, restricted stock, stock appreciation rights, deferred stock units (“DSUs”) and performance shares, as defined, to the directors, officers and employees of the Company and Vornado.

In May 2023, we granted each of the members of our Board of Directors 449 DSUs with a market value of $ 75,000 per grant.

The grant date fair value of these awards was $ 56,250 per grant, or $ 450,000 in the aggregate, in accordance with ASC 718.

The DSUs entitle the holders to receive shares of the Company’s common stock without the payment of any consideration.

The DSUs vested immediately and accordingly, were expensed on the date of grant, but the shares of common stock underlying the DSUs are not deliverable to the grantee until the grantee is no longer serving on the Company’s Board of Directors.

As of June 30, 2023, there were 23,388 DSUs outstanding and 482,399 shares were available for future grant under the Plan.

ALEXANDER’S, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Fair Value Measurements

8 unchanged sentences

Financial Assets and Liabilities Measured at Fair Value

Financial assets measured at fair value on our consolidated balance sheet as of March 31, 2023 consist of U.S.

Treasury bills (classified as available-for-sale) and interest rate derivatives which are presented in the table below based on their level in the fair value hierarchy.

There were no financial liabilities measured at fair value as of March 31, 2023.

As of March 31, 2023

Total Level 1 Level 2 Level 3

(Amounts in thousands)

Investments in U.S.

Treasury bills (1)

$ 99,780 $ 99,780 $ — $ —

Financial assets measured at fair value on our consolidated balance sheet as of June 30, 2023 consist of interest rate derivatives, which are presented in the table below based on their level in the fair value hierarchy.

There were no financial liabilities measured at fair value as of June 30, 2023.

As of June 30, 2023

(Amounts in thousands) Total Level 1 Level 2 Level 3

Interest rate derivatives (included in other assets) $ 38,407 $ — $ 38,407 $ —

$ 124,437 $ 99,780 $ 24,657 $ —

(1) As of March 31, 2023, our investments in U.S.

Treasury bills have an aggregate accreted value of $ 99,881 prior to being marked to fair value and have remaining maturities of less than one year.

During the three months ended March 31, 2023, we realized proceeds of $ 170,000 from maturing U.S.

Treasury bills.

ALEXANDER’S, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Fair Value Measurements - continued

Financial assets measured at fair value on our consolidated balance sheet as of December 31, 2022 consist of U.S.

5 unchanged sentences

Treasury bills $ 266,963 $ 266,963 $ — $ —

$ 266,963 $ 266,963 $ — $ —

Interest rate derivatives (included in other assets) 29,351 — 29,351 —

$ 296,314 $ 266,963 $ 29,351 $ —

(1) During the year ended December 31, 2022, we purchased $ 364,238 in U.S.

Treasury bills with an aggregate par value of $ 370,000 and realized proceeds of $ 100,000 from maturing U.S.

Treasury bills.

As of December 31, 2022 our investments in U.S.

Treasury bills had an aggregate accreted value of $ 267,809 prior to being marked to fair value and had remaining maturities of less than one year.

ALEXANDER’S, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Fair Value Measurements - continued

Interest Rate Derivatives

We recognize the fair value of all interest rate derivatives in “other assets” or “other liabilities” on our consolidated balance sheets and since all of our interest rate derivatives have been designated as cash flow hedges, changes in the fair value are recognized in other comprehensive income.

The table below summarizes our interest rate derivatives, all of which hedge the interest rate risk attributable to the variable rate debt noted as of March 31, 2023 and December 31, 2022, respectively.

Fair Value as of As of March 31, 2023

(Amounts in thousands) March 31, 2023 December 31, 2022 Notional Amount Swapped Rate Expiration Date

The table below summarizes our interest rate derivatives, all of which hedge the interest rate risk attributable to the variable rate debt noted as of June 30, 2023 and December 31, 2022, respectively.

Fair Value as of As of June 30, 2023

(Amounts in thousands) June 30, 2023 December 31, 2022 Notional Amount Swapped Rate Expiration Date

Interest rate swap related to:

5 unchanged sentences

(1) SOFR cap strike rate of 4.15 %.

(2) LIBOR cap strike rate of 6.00 %

(2) In June 2023, we purchased an interest rate cap for $ 11,258 , which capped LIBOR at 6.00 % through July 15, 2023 and then the Prime Rate ( 8.25 % as of June 30, 2023) at 6.00 % through loan maturity.

See Note 7 - Mortgages Payable for further information.

Financial Assets and Liabilities not Measured at Fair Value

2 unchanged sentences

The fair value of our mortgages payable is calculated by discounting the future contractual cash flows of these instruments using current risk-adjusted rates available to borrowers with similar credit ratings, which are provided by a third-party specialist, and is classified as Level 2.

The table below summarizes the carrying amount and fair value of these financial instruments as of March 31, 2023 and December 31, 2022.

As of March 31, 2023 As of December 31, 2022

The table below summarizes the carrying amount and fair value of these financial instruments as of June 30, 2023 and December 31, 2022.

As of June 30, 2023 As of December 31, 2022

(Amounts in thousands) Carrying

20 unchanged sentences

Letters of Credit

Approximately $ 900,000 of standby letters of credit were issued and outstanding as of March 31, 2023.

Approximately $ 900,000 of standby letters of credit were issued and outstanding as of June 30, 2023.

There are various legal actions brought against us from time-to-time in the ordinary course of business.

4 unchanged sentences

Diluted income per share is determined using the weighted average shares of common stock (including deferred stock units) outstanding during the period, and assumes all potentially dilutive securities were converted into common shares at the earliest date possible.

There were no potentially dilutive securities outstanding during the three months ended March 31, 2023 and 2022.

For the Three Months Ended March 31,

There were no potentially dilutive securities outstanding during the three and six months ended June 30, 2023 and 2022.

For the Three Months Ended June 30, For the Six Months Ended June 30,

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

2023 2022 2023 2022

Net income $ 64,147 $ 14,814 $ 75,373 $ 29,346

6 unchanged sentences

We have reviewed the accompanying consolidated balance sheet of Alexander’s, Inc.

and subsidiaries (the “Company”) as of March 31, 2023, the related consolidated statements of income, comprehensive income, changes in equity and cash flows for the three-month periods ended March 31, 2023 and 2022, and the related notes (collectively referred to as the “interim financial information”).

and subsidiaries (the “Company”) as of June 30, 2023, the related consolidated statements of income, comprehensive income, and changes in equity, for the three-month and six-month periods ended June 30, 2023, and 2022, and of cash flows for the six-month periods ended June 30, 2023 and 2022, and the related notes (collectively referred to as the “interim financial information”).

Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial information for it to be in conformity with accounting principles generally accepted in the United States of America.

12 unchanged sentences

New York, New York

July 31, 2023

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements