What changed in this filing

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Item 1. Financial Statements

2024-08-05 compared with 2024-05-06 · 107 added, 49 removed, 306 unchanged (34% of the section changed)

4 unchanged sentences

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

ASSETS March 31, 2024 December 31, 2023

ASSETS June 30, 2024 December 31, 2023

Real estate, at cost:

18 unchanged sentences

Accounts payable and accrued expenses 50,778 51,750

Lease incentive liability 113,618 —

Other liabilities 21,199 21,007

24 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,

2024 2023 2024 2023

Rental revenues $ 53,392 $ 53,673 $ 114,789 $ 106,614

2 unchanged sentences

Depreciation and amortization ( 8,697 ) ( 8,081 ) ( 18,174 ) ( 15,559 )

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

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

( 2,159 ) ( 1,906 ) ( 3,635 ) ( 3,265 )

2 unchanged sentences

Interest and debt expense ( 16,219 ) ( 13,196 ) ( 32,453 ) ( 25,449 )

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

Net income $ 8,380 $ 64,147 $ 24,489 $ 75,373

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,

2024 2023 2024 2023

Net income $ 8,380 $ 64,147 $ 24,489 $ 75,373

Other comprehensive loss:

Other comprehensive (loss) income:

Change in fair value of interest rate derivatives and other ( 3,360 ) 3,110 ( 3,900 ) ( 534 )

10 unchanged sentences

Shares Amount

For the Three Months Ended March 31, 2024

Balance, December 31, 2023 5,173 $ 5,173 $ 34,315 $ 182,336 $ 16,201 $ ( 368 ) $ 237,657

For the Three Months Ended June 30, 2024

Balance, March 31, 2024 5,173 $ 5,173 $ 34,315 $ 175,357 $ 15,661 $ ( 368 ) $ 230,138

Net income — — — 8,380 — — 8,380

2 unchanged sentences

Change in fair value of interest rate derivatives — — — — ( 3,360 ) — ( 3,360 )

Deferred stock unit grants — — 450 — — — 450

Balance, June 30, 2024 5,173 $ 5,173 $ 34,765 $ 160,649 $ 12,301 $ ( 368 ) $ 212,520

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

For the Three Months Ended March 31, 2023

Net income — — — 64,147 — — 64,147

Dividends paid ($ 4.50 per common share)

— — — ( 23,072 ) — — ( 23,072 )

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

Capital Retained

Earnings Accumulated

Comprehensive Income Treasury

Stock Total Equity

Shares Amount

For the Six Months Ended June 30, 2024

Balance, December 31, 2023 5,173 $ 5,173 $ 34,315 $ 182,336 $ 16,201 $ ( 368 ) $ 237,657

2 unchanged sentences

— — — ( 46,176 ) — — ( 46,176 )

Change in fair value of interest rate derivatives — — — — ( 3,900 ) — ( 3,900 )

Deferred stock unit grants — — 450 — — — 450

Balance, June 30, 2024 5,173 $ 5,173 $ 34,765 $ 160,649 $ 12,301 $ ( 368 ) $ 212,520

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

Net income — — — 75,373 — — 75,373

Dividends paid ($ 9.00 per common share)

— — — ( 46,144 ) — — ( 46,144 )

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

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

Deferred stock unit grants — — 450 — — — 450

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

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 2024 2023

2 unchanged sentences

Depreciation and amortization, including amortization of debt issuance costs 19,118 16,399

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

Straight-lining of rents 11,076 4,169

Interest rate cap premium amortization 5,908 —

Stock-based compensation expense 450 450

Other non-cash adjustments ( 3,804 ) 4,431

4 unchanged sentences

Accounts payable and accrued expenses ( 192 ) 1,900

Lease incentive liability 113,618 —

Other liabilities ( 10 ) ( 12 )

4 unchanged sentences

Treasury bills — 264,881

Proceeds from sale of real estate — 67,821

Proceeds from interest rate cap 6,563 —

Purchase of interest rate cap — ( 11,258 )

Net cash provided by investing activities 381 318,550

1 unchanged sentence

Dividends paid ( 46,176 ) ( 46,144 )

Debt repayment ( 10,000 ) —

Debt issuance costs ( 1,132 ) ( 38 )

15 unchanged sentences

to Vornado in 2024

$ 2,708 $ 1,481

Write-off of fully depreciated assets 1,759 5,808

Reclassification of asset held for sale — 13,794

See notes to consolidated financial statements (unaudited).

15 unchanged sentences

Actual results could differ from those estimates.

The results of operations for the three months ended March 31, 2024 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, 2024 are not necessarily indicative of the operating results for the full year.

We operate in one reportable segment.

Recently Issued Accounting Literature

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures (“ASU 2023-07”).

13 unchanged sentences

Revenue Recognition

The following is a summary of revenue sources for the three months ended March 31, 2024 and 2023.

For the Three Months Ended March 31,

The following is a summary of revenue sources for the three and six months ended June 30, 2024 and 2023.

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

(Amounts in thousands) 2024 2023 2024 2023

3 unchanged sentences

Rental revenues $ 53,392 $ 53,673 $ 114,789 $ 106,614

The components of lease revenues for the three months ended March 31, 2024 and 2023 are as follows:

For the Three Months Ended March 31,

The components of lease revenues for the three and six months ended June 30, 2024 and 2023 are as follows:

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

(Amounts in thousands) 2024 2023 2024 2023

3 unchanged sentences

Bloomberg L.P.

(“Bloomberg”) accounted for revenue of $ 29,963,000 and $ 29,516,000 for the three months ended March 31, 2024 and 2023, respectively, representing approximately 49 % and 56 % of our rental revenues in each period, respectively.

(“Bloomberg”) accounted for revenue of $ 60,946,000 and $ 59,177,000 for the six months ended June 30, 2024 and 2023, respectively, representing approximately 53 % and 56 % of our rental revenues in each period, respectively.

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.

In May 2024, Alexander’s and Bloomberg reached an agreement to extend the leases covering approximately 947,000 square feet at our 731 Lexington Avenue property that were scheduled to expire in February 2029 for a term of eleven years to February 2040.

On May 3, 2024, Alexander’s and Bloomberg entered into an agreement to extend the leases covering approximately 947,000 square feet at our 731 Lexington Avenue property that were scheduled to expire in February 2029 for a term of eleven years to February 2040.

Upon execution of this lease extension, we paid a $ 32,000,000 leasing commission, of which $ 26,500,000 was to a third-party broker and $ 5,500,000 was to Vornado.

In connection with the lease extension, Bloomberg is entitled to a $ 113,618,000 tenant fund which is accounted for as a lease incentive under GAAP.

Accordingly, we recorded a deferred lease incentive asset of $ 113,618,000 , which is amortized as a reduction to rental revenues over the remaining term of the lease, and a corresponding liability.

These amounts are included in “Deferred leasing costs, net” and “Lease incentive liability,” respectively, on our consolidated balance sheet as of June 30, 2024.

On December 3, 2022, IKEA closed its 112,000 square foot store at our Rego Park I property under a lease that was set to expire in December 2030.

2 unchanged sentences

During the fourth quarter of 2023 and the first quarter of 2024, IKEA paid its remaining rent obligation through March 16, 2026 and the $ 10,000,000 termination payment.

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, 2024, Vornado owned 32.4 % of our outstanding common stock.

As of June 30, 2024, 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.

10 unchanged sentences

The following is a summary of fees earned by 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) 2024 2023 2024 2023

2 unchanged sentences

Leasing fees 5,517 129 5,555 170

Commission on sale of real estate — 711 — 711

Property management, cleaning, engineering, parking and security fees 1,213 1,550 2,849 2,959

$ 7,541 $ 3,090 $ 9,930 $ 5,240

As of March 31, 2024, the amounts due to Vornado were $ 441,000 for management, property management, cleaning, engineering and security fees, $ 38,000 for leasing fees and $ 14,000 for development fees.

As of June 30, 2024, the amounts due to Vornado were $ 480,000 for management, property management, cleaning, engineering and security fees, $ 126,000 for development fees and $ 17,000 for leasing fees.

As of December 31, 2023, the amounts due to Vornado were $ 646,000 for management, property management, cleaning, engineering and security fees and $ 69,000 for leasing fees.

3 unchanged sentences

Mortgages Payable

The following is a summary of our outstanding mortgages payable as of March 31, 2024 and December 31, 2023.

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 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 at 6.00 % through loan maturity.

On June 11, 2024, we entered into a four-month extension of the loan and simultaneously paid down the principal balance by $ 10,000,000 to $ 490,000,000 .

The interest-only mortgage loan remains at the Prime rate ( 8.50 % as of June 30, 2024) through the extended loan maturity of October 11, 2024.

We also escrowed $ 66,808,000 with the lender in connection with the tenant fund in the Bloomberg lease extension which is included in “Restricted cash” on our consolidated balance sheet as of June 30, 2024.

The following is a summary of our outstanding mortgages payable as of June 30, 2024 and December 31, 2023.

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

Interest Rate at March 31, 2024 Balance at

(Amounts in thousands) Maturity March 31, 2024 December 31, 2023

Interest Rate at June 30, 2024 Balance at

(Amounts in thousands) Maturity June 30, 2024 December 31, 2023

First mortgages secured by:

11 unchanged sentences

$ 1,082,012 $ 1,092,551

(1) Interest at the Prime Rate (capped at 6.00 % through loan maturity).

(2) Interest rate listed represents the rate in effect as of March 31, 2024 based on SOFR as of contractual reset date plus contractual spread, adjusted for hedging instruments as applicable.

(1) Interest at the Prime Rate.

(2) Interest rate listed represents the rate in effect as of June 30, 2024 based on SOFR as of contractual reset date plus contractual spread, adjusted for hedging instruments as applicable.

(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).

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 2024, we granted each of the members of our Board of Directors 357 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, 2024, there were 26,244 DSUs outstanding and 479,543 shares were available for future grant under the Plan.

ALEXANDER’S, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Fair Value Measurements

7 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, 2024 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 March 31, 2024.

As of March 31, 2024

Financial assets measured at fair value on our consolidated balance sheet as of June 30, 2024 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, 2024.

As of June 30, 2024

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

5 unchanged sentences

Interest rate derivatives (included in other assets) $ 22,608 $ — $ 22,608 $ —

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, 2024 and December 31, 2023, respectively.

Fair Value as of As of March 31, 2024

(Amounts in thousands) March 31, 2024 December 31, 2023 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, 2024 and December 31, 2023, respectively.

Fair Value as of As of June 30, 2024

(Amounts in thousands) June 30, 2024 December 31, 2023 Notional Amount Swapped Rate Expiration Date

Interest rate swap related to:

2 unchanged sentences

Rego Park II shopping center mortgage loan 920 1,370 202,544 (1) 11/24

731 Lexington Avenue mortgage loan, office condominium 2,497 4,923 500,000 (2) 06/24

731 Lexington Avenue mortgage loan, office condominium — 4,923 N/A N/A N/A

Included in other assets $ 12,800 $ 22,608

(1) SOFR cap strike rate of 4.15 %.

(2) In June 2023, we purchased an interest rate cap for $ 11,258 , which capped the Prime Rate at 6.00 % ( 8.50 % as of March 31, 2024) through loan maturity.

ALEXANDER’S, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Fair Value Measurements - continued

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, 2024 and December 31, 2023, respectively.

As of March 31, 2024 As of December 31, 2023

The table below summarizes the carrying amount and fair value of these financial instruments as of June 30, 2024 and December 31, 2023, respectively.

As of June 30, 2024 As of December 31, 2023

(Amounts in thousands) Carrying

3 unchanged sentences

Mortgages payable (excluding deferred debt issuance costs, net) $ 1,086,544 $ 1,066,388 $ 1,096,544 $ 1,071,887

ALEXANDER’S, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Commitments and Contingencies

12 unchanged sentences

Letters of Credit

Approximately $ 900,000 of standby letters of credit were issued and outstanding as of March 31, 2024.

Approximately $ 900,000 of standby letters of credit were issued and outstanding as of June 30, 2024.

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

In our opinion, the outcome of such pending matters in the aggregate will not have a material effect on our financial position, results of operations or cash flows.

ALEXANDER’S, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Earnings Per Share

2 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, 2024 and 2023.

For the Three Months Ended March 31,

There were no potentially dilutive securities outstanding during the three and six months ended June 30, 2024 and 2023.

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

Ended June 30,

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

2024 2023 2024 2023

Net income $ 8,380 $ 64,147 $ 24,489 $ 75,373

6 unchanged sentences

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

and subsidiaries (the “Company”) as of March 31, 2024, the related consolidated statements of income, comprehensive income, changes in equity and cash flows for the three-month periods ended March 31, 2024 and 2023, and the related notes (collectively referred to as the “interim financial information”).

and subsidiaries (the “Company”) as of June 30, 2024, the related consolidated statements of income, comprehensive income, and changes in equity, for the three-month and six-month periods ended June 30, 2024 and 2023, and of cash flows for the six-month periods ended June 30, 2024 and 2023, 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

August 5, 2024

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