What changed in this filing

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Item 2. Management’s Discussion and Analysis

2022-08-04 compared with 2022-05-05 · 150 added, 85 removed, 277 unchanged (46% of the section changed)

19 unchanged sentences

(viii) defaults on, early terminations of, or non-renewal of, leases by tenants;

(ix) increases in the Company’s borrowing costs as a result of changes in interest rates and other factors, including the phasing out of LIBOR after 2021;

(ix) increases or uncertainty in interest rates, including the phasing out of LIBOR, which may negatively affect the Company’s borrowing costs and the market valuation of real property assets generally;

(x) declining real estate valuations and impairment charges;

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and (xx) accuracy of our methodologies and estimates regarding ESG metrics and goals, tenant willingness and ability to collaborate in reporting ESG metrics and meeting ESG goals, and the impact of governmental regulation on our ESG efforts;

(xxi) economic cycles involving inflation and/or recession;

(xxii) supply chain disruptions which may limit or delay our timely sourcing of supplies for the maintenance of our facilities and equipment.

For a further discussion of these and other factors that could impact the Company's future results, performance or transactions, see the section entitled “Risk Factors” in this Quarterly Report on Form 10-Q, and in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, and other risks described in documents subsequently filed by the Company from time to time with the Securities and Exchange Commission.

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is the entity through which ESRT, a self-administered and self-managed REIT, conducts all of its business and owns (either directly or through subsidiaries) substantially all of its assets.

We own and manage a well-positioned property portfolio of office, retail and multifamily assets in Manhattan and the greater New York metropolitan area.

We own and manage office, retail and multifamily assets in Manhattan and the greater New York metropolitan area.

As the owner of the Empire State Building, the World’s Most Famous Building, ESRT also owns and operates its iconic, newly reimagined Observatory Experience.

Highlights for the three months ended March 31, 2022

• Incurred net loss of $18.2 million and achieved Core Funds From Operations ("Core FFO") of $49.2 million.

• Total portfolio 87.0% leased, New York City office portfolio 88.6% leased.

Highlights for the three months ended June 30, 2022

• Incurred net income attributable to common unitholders of $47.8 million and achieved Core Funds From Operations attributable to common unitholders ("Core FFO") of $79.2 million.

• Total commercial portfolio 87.8% leased, New York City office portfolio 88.3% leased.

• Signed a total of 320,225 rentable square feet of new, renewal, and expansion leases.

• Empire State Building observatory revenue was $13.2 million and observatory NOI was $7.0 million for the first quarter of 2022.

• Repurchased $23.3 million of our common stock at a weighted average price of $9.34 per share in the first quarter and through April 21, 2022.

Since the stock repurchase program began on March 5, 2020 through April 21, 2022, approximately $215 million at a weighted average price of $8.67 per share has been repurchased.

• Empire State Building observatory revenue was $27.4 million and observatory net operating income was $19.6 million for the second quarter of 2022.

• ESRT repurchased $53.7 million of its common stock at a weighted average price of $7.90 per share in the second quarter of 2022 and through July 21, 2022.

Since the stock repurchase program began on March 5, 2020 through July 21, 2022, approximately $256 million at a weighted average price of $8.48 per share has been repurchased.

Results of Operations

The discussion below relates to our financial condition and results of operations for the three months ended March 31, 2022 and 2021, respectively.

Three Months Ended March 31, 2022 Compared to the Three Months Ended March 31, 2021

The following table summarizes our historical results of operations for the three months ended March 31, 2022 and 2021 (dollars in thousands):

Three Months Ended March 31,

The discussion below relates to our financial condition and results of operations for the three months ended June 30, 2022 and 2021, respectively.

Three Months Ended June 30, 2022 Compared to the Three Months Ended June 30, 2021

The following table summarizes our historical results of operations for the three months ended June 30, 2022 and 2021 (amounts in thousands):

Three Months Ended June 30,

2022 2021 Change %

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(25,042) (23,422) (1,620) (6.9) %

Gain on disposition of property

27,170 — 27,170 100.0 %

Income before income taxes

49,058 3,226 45,832 (1,420.7) %

Income tax (expense) benefit

(363) 1,185 (1,548) 130.6 %

48,695 4,411 44,284 (1,003.9) %

Private perpetual preferred unit distributions (1,051) (1,051) — — %

Net loss attributable to non-controlling interests in other partnerships 159 — 159 100.0 %

Net income attributable to common unitholders

$ 47,803 $ 3,360 $ 44,443 (1,322.7) %

Rental Revenue

The increase in rental revenue reflects the inclusion of revenue from our recently acquired multifamily properties.

Observatory Revenue

Observatory revenues were higher driven by increased visitation

Other Revenues and Fees

The increase in other revenues and fees was due to higher food and beverage sales, insurance claim income, parking income and bad debt recovery income.

Property Operating Expenses

The increase in property operating expenses reflects higher payroll, utilities, cleaning and other operating expenses, and the inclusion of operating expenses from our recently acquired multifamily properties.

General and Administrative Expenses

The increase in general and administrative expenses reflects higher equity compensation and payroll costs, information technology costs and professional fees.

Observatory Expenses

The increase in observatory expenses was driven by increased operating hours, which increased variable costs such as labor, union, security, cleaning and maintenance costs.

Real Estate Taxes

Lower real estate taxes were attributable to the overall reduction in property tax assessment values.

Depreciation and Amortization

The increase in depreciation and amortization reflects accelerated depreciation at one property due to an impairment charge taken in the fourth quarter of 2021 and additional depreciation from our recently acquired multifamily properties.

Interest Expense

The increase reflects additional interest expense from our recently acquired multifamily properties, partially offset by the cancellation of debt from 383 Main Avenue, Norwalk CT.

The decrease in income tax benefit was attributable to higher net operating income for the observatory segment.

Gain on disposition of property

Represents a gain on the transfer of 383 Main Avenue, Norwalk CT, which was encumbered by a $30.0 million mortgage, back to the lender in a consensual foreclosure.

Six Months Ended June 30, 2022 Compared to the Six Months Ended June 30, 2021

The following table summarizes our historical results of operations for the six months ended June 30, 2022 and 2021 (dollars in thousands):

Six Months Ended June 30,

2022 2021 Change %

Rental revenue

$ 296,853 $ 281,028 $ 15,825 5.6 %

Observatory revenue 40,609 10,962 29,647 270.5 %

Lease termination fees 20,032 4,628 15,404 332.8 %

Third-party management and other fees

636 603 33 5.5 %

Other revenues and fees

3,926 1,491 2,435 163.3 %

Total revenues

362,056 298,712 63,344 21.2 %

Operating expenses:

Property operating expenses

76,077 59,072 (17,005) (28.8) %

Ground rent expenses

4,663 4,663 — — %

General and administrative expenses

29,562 27,942 (1,620) (5.8) %

Observatory expenses

13,991 9,856 (4,135) (42.0) %

Real estate taxes

59,806 62,801 2,995 4.8 %

Depreciation and amortization

125,410 89,545 (35,865) (40.1) %

Total operating expenses

309,509 253,879 (55,630) (21.9) %

Operating income

52,547 44,833 7,714 17.2 %

Other income (expense):

Interest income

580 286 294 102.8 %

Interest expense

(50,056) (46,976) (3,080) (6.6) %

Loss on early extinguishment of debt — (214) 214 100.0 %

Loss before income taxes

Gain on disposition of property

27,170 — 27,170 100.0 %

Income (loss) before income taxes

30,241 (2,071) 32,312 1,560.2 %

Income tax benefit

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Net loss attributable to non-controlling interests in other partnerships 222 — 222 100.0 %

Net loss attributable to common unitholders

Net income (loss) attributable to common unitholders

$ 29,595 $ (881) $ 30,476 3,459.3 %

Rental Revenue

The increase in rental revenue reflects additional below market lease amortization, net and the inclusion of revenue from our recently acquired multifamily properties.

The increase in rental revenue reflects the inclusion of revenue from our recently acquired multifamily properties.

Observatory Revenue

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Other Revenues and Fees

The increase in other revenues and fees was due to higher food and beverage sales, parking income, bad debt recovery income and other income.

The increase in other revenues and fees was due to higher food and beverage sales, insurance claim income, parking income and bad debt recovery income.

Property Operating Expenses

The increase in property operating expenses reflect higher payroll, utilities, repairs and maintenance, cleaning and other operating expenses, and the inclusion of operating expenses from our recently acquired multifamily properties.

The increase in property operating expenses reflects higher payroll, utilities, repairs and maintenance costs, cleaning and other operating expenses, and the inclusion of operating expenses from our recently acquired multifamily properties.

General and Administrative Expenses

The increase in general and administrative expenses reflects higher equity compensation and payroll costs, information technology costs and professional fees.

Observatory Expenses

1 unchanged sentence

Real Estate Taxes

Lower real estate taxes were attributable to the overall reduction in property assessment values due to the impact of COVID-19.

Lower real estate taxes were attributable to the overall reduction in property tax assessment values.

Depreciation and Amortization

The increase in depreciation and amortization reflects accelerated depreciation at one property due to an impairment charge in the fourth quarter of 2021 and additional depreciation from our recently acquired multifamily properties.

Interest Expense

The increase reflects additional interest expense from our recently acquired multifamily properties.

The decrease in income tax benefit was attributable to lower net operating loss for the observatory segment.

The increase in interest expense reflects additional interest expense from our recently acquired multifamily properties, partially offset by the cancellation of debt from 383 Main Avenue, Norwalk CT.

The decrease in income tax benefit was attributable to higher net operating income for the observatory segment.

Gain on disposition of property

Represents a gain on the transfer of 383 Main Avenue, Norwalk CT, which was encumbered by a $30.0 million mortgage, back to the lender in a consensual foreclosure.

Liquidity and Capital Resources

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We expect to meet our long-term capital requirements, including acquisitions, redevelopments and capital expenditures through our cash flows from operations, cash on hand, our unsecured revolving credit facility, mortgage financings, debt issuances, common and/or preferred equity issuances and asset sales.

Our properties require periodic investments of capital for individual lease related tenant improvements allowances, general capital improvements and costs associated with capital expenditures.

Our properties require periodic

investments of capital for individual lease related tenant improvements allowances, general capital improvements and costs associated with capital expenditures.

Our overall leverage will depend on our mix of investments and the cost of leverage.

ESRT's charter does not restrict the amount of leverage that we may use.

At March 31, 2022, we had $429.7 million available in cash and cash equivalents, and $850 million available under our unsecured revolving credit facility.

As of March 31, 2022, we had approximately $2.3 billion of total consolidated indebtedness outstanding, with a weighted average interest rate of 3.9% and a weighted average maturity of 7.2 years.

As of March 31, 2022, excluding principal amortization, we have no outstanding debt maturing until November 2024.

Our consolidated net debt to total market capitalization was 40.0% as of March 31, 2022.

At June 30, 2022, we had $359.4 million available in cash and cash equivalents, and $850 million available under our unsecured revolving credit facility.

As of June 30, 2022, we had approximately $2.3 billion of total consolidated indebtedness outstanding, with a weighted average interest rate of 3.9% and a weighted average maturity of 6.9 years.

As of June 30, 2022, excluding principal amortization, we have no outstanding debt maturing until November 2024.

Our consolidated net debt to total market capitalization was 49.0% as of June 30, 2022.

Unsecured Revolving Credit and Term Loan Facilities

On March 31, 2021, we entered into a second amendment to an existing credit agreement ("Amended Credit Agreement") that governs an amended senior unsecured credit facility (the "Credit Facility") with Bank of America, N.A., as administrative agent and the other lenders party thereto.

The Amended Credit Agreement amended the amended and restated

credit agreement dated August 29, 2017 by and among the parties named therein.

The Credit Facility is in the initial maximum principal amount of up to $1.065 billion, which consists of $850.0 million revolving credit facility that matures on March 31, 2025, and a $215.0 million term loan facility that matures on March 19, 2025.

As of March 31, 2022, we had no borrowings under the revolving credit facility and $215.0 million under the term loan facility.

On March 19, 2020, we entered into a senior unsecured term loan facility (the “Term Loan Facility”) with Wells Fargo Bank, National Association, as administrative agent, and the other lenders party thereto.

The Term loan Facility is in the original principal amount of $175.0 million and matures on December 31, 2026.

We may request the Term Loan Facility be increased through one or more increases or the addition of new pari passu term loan tranches, for a maximum aggregate principal amount not to exceed $225 million.

As of March 31, 2022, our borrowings amounted to $175.0 million under the Term Loan Facility.

The terms of both the Credit Facility and the Term Loan Facility include customary covenants, including limitations on liens, investment, distributions, debt, fundamental changes, and transactions with affiliates and require certain customary financial reports.

Both facilities also require compliance with financial ratios including a maximum leverage ratio, a maximum secured leverage ratio, a minimum fixed charge coverage ratio, a minimum unencumbered interest coverage ratio, and a maximum unsecured leverage ratio.

The agreements governing both facilities also contain customary events of default (subject in certain cases to specified cure periods), including but not limited to non-payment, breach of covenants, representations or warranties, cross defaults, bankruptcy or other insolvency events, judgments, ERISA events, invalidity of loan documents, loss of real estate investment trust qualification, and occurrence of a change of control.

As of March 31, 2022, we were in compliance with the covenants.

See "Financial Statements - Note 5.

Debt" for a summary of our unsecured revolving credit and term loan facilities.

Mortgage Debt

As of March 31, 2022, mortgage notes payable amounted to $966.7 million.

As of June 30, 2022, mortgage notes payable amounted to $935.1 million.

The first maturity is in 2024.

See Note 4 - Debt for more information on mortgage debt.

See "Financial Statements - Note 5.

Debt" for more information on mortgage debt.

Senior Unsecured Notes

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The agreements also contain customary events of default (subject in certain cases to specified cure periods), including but not limited to non-payment, breach of covenants, representations or warranties, cross defaults, bankruptcy or other insolvency events, judgments, ERISA events, the occurrence of certain change of control transactions and loss of real estate investment trust qualification.

As of March 31, 2022, we were in compliance with the covenants under the outstanding senior unsecured notes.

As of June 30, 2022, we were in compliance with the covenants under the outstanding senior unsecured notes.

Financial Covenants

As of March 31, 2022, we were in compliance with the following financial covenants:

Financial covenant Required March 31, 2022 In Compliance

As of June 30, 2022, we were in compliance with the following financial covenants:

Financial covenant Required June 30, 2022 In Compliance

Maximum total leverage < 60% 31.6 % Yes

Maximum secured debt < 40% 15.9 % Yes

Maximum secured leverage < 40% 12.7 % Yes

Minimum fixed charge coverage > 1.50x 3.4x Yes

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Although ESRT's board of directors has not adopted a policy that limits the total amount of indebtedness that we may incur, we anticipate that ESRT's board of directors will consider a number of factors in evaluating our level of indebtedness from time to time, as well as the amount of such indebtedness that will be either fixed or floating rate.

ESRT's charter and bylaws do not limit the amount or percentage of indebtedness that we may incur nor do they restrict the form in which our

indebtedness will be taken (including, but not limited to, recourse or non-recourse debt and cross-collateralized debt).

ESRT's charter and bylaws do not limit the amount or percentage of indebtedness that we may incur nor do they restrict the form in which our indebtedness will be taken (including, but not limited to, recourse or non-recourse debt and cross-collateralized debt).

Our overall leverage will depend on our mix of investments and the cost of leverage, however, we initially intend to maintain a level of indebtedness consistent with our plan to seek an investment grade credit rating.

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Office Properties (1)

Three months ended March 31,

Six Months Ended June 30,

Total New Leases, Expansions, and Renewals 2022 2021

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634,582 350,196

Leasing commission costs (3)

$ 6,258 $ 3,473

Tenant improvement costs (3)

21,047 12,782

Total leasing commissions and tenant improvement costs (3)

$ 27,305 $ 16,255

Leasing commission costs per square foot (3)

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Retail Properties (4)

Three months ended March 31,

Six Months Ended June 30,

Total New Leases, Expansions, and Renewals 2022 2021

1 unchanged sentence

Total square feet

Leasing commission costs (3)

Tenant improvement costs (3)

Total leasing commissions and tenant improvement costs (3)

Leasing commission costs per square foot (3)

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Excludes the Empire State Building broadcasting licenses and observatory operations.

Three months ended March 31,

Six Months Ended June 30,

Total Portfolio

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(1) Excludes tenant improvements and leasing commission costs.

As of March 31, 2022, we expect to incur additional costs relating to obligations under existing lease agreements of approximately $102.9 million for tenant improvements and leasing commissions.

We intend to fund the tenant improvements

and leasing commission costs through a combination of operating cash flow, cash on hand, additional property level mortgage financings and borrowings under the unsecured revolving credit facility.

As of June 30, 2022, we expect to incur additional costs relating to obligations under existing lease agreements of approximately $105.3 million for tenant improvements and leasing commissions.

We intend to fund the tenant improvements and leasing commission costs through a combination of operating cash flow, cash on hand, additional property level mortgage financings and borrowings under the unsecured revolving credit facility.

Capital expenditures are considered part of both our short-term and long-term liquidity requirements.

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Off-Balance Sheet Arrangements

As of March 31, 2022, we did not have any off-balance sheet arrangements.

As of June 30, 2022, we did not have any off-balance sheet arrangements.

Distribution Policy

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Distribution to Equity Holders

Distributions and dividends amounting to $10.8 million and $1.1 million have been made to equity holders for the three months ended March 31, 2022 and 2021, respectively.

Distributions and dividends amounting to $21.6 million and $11.6 million have been made to equity holders for the six months ended June 30, 2022 and 2021, respectively.

Stock and Publicly Traded Operating Partnership Unit Repurchase Program

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See "Financial Statements - Note 10.

Capital" for a summary of ESRT's purchases of equity securities in each of the three months ended March 31, 2022.

Comparison of Three Months Ended March 31, 2022 to the Three Months Ended March 31, 2021

Cash and cash equivalents and restricted cash were $482.7 million and $607.4 million, respectively, as of March 31, 2022 and 2021.

Capital" for a summary of ESRT's purchases of equity securities in each of the three months ended June 30, 2022.

Comparison of Six Months Ended June 30, 2022 to the Six Months Ended June 30, 2021

Cash and cash equivalents and restricted cash were $412.8 million and $578.6 million, respectively, as of June 30, 2022 and 2021.

The decrease was primarily due to the acquisition of real estate property at the end of 2021 and higher spending for capital expenditures, higher repurchases of common shares and higher dividends paid in 2022.

Operating activities .

Net cash provided by operating activities decreased by $5.7 million to $67.7 million primarily due to changes in working capital.

Net cash provided by operating activities was $83.7 million, equal to prior year.

Investing activities .

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NOI is a non-GAAP financial measure of performance.

NOI is used by our management to evaluate and compare the performance of our

properties and to determine trends in earnings and to compute the fair value of our properties as it is not affected by:

NOI is used by our management to evaluate and compare the performance of our properties and to determine trends in earnings and to compute the fair value of our properties as it is not affected by:

(i) the cost of funds of the property owner, (ii) the impact of depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets that are included in net income computed in accordance with GAAP, (iii) acquisition expenses, loss on early extinguishment of debt and loss from derivative financial instruments, or (iv) general and administrative expenses and other gains and losses that are specific to the property owner.

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These gains and losses can create distortions when comparing one period to another or when comparing our operating results to the operating results of other real estate companies that have not made similarly-timed purchases or sales.

We believe that eliminating these costs from net income is useful to investors because the resulting measure captures the actual revenue, generated and actual expenses incurred in operating our properties as well as trends in occupancy rates, rental rates and operating costs.

We believe that eliminating these costs from net income is useful to investors because the resulting

measure captures the actual revenue, generated and actual expenses incurred in operating our properties as well as trends in occupancy rates, rental rates and operating costs.

However, the usefulness of NOI is limited because it excludes general and administrative costs, interest expense, depreciation and amortization expense and gains or losses from the sale of properties, and other gains and losses as stipulated by GAAP, the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, all of which are significant economic costs.

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The following table presents a reconciliation of our net income, the most directly comparable GAAP measure, to NOI for the periods presented (amounts in thousands):

Three months ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2022 2021 2022 2021

(unaudited) (unaudited)

$ 48,695 $ 4,411 $ 31,474 $ 1,220

General and administrative expenses

4 unchanged sentences

25,042 23,422 50,056 46,976

Loss on early extinguishment of debt

Income tax expense (benefit)

363 (1,185) (1,233) (3,291)

Gain on disposition of property (27,170) — (27,170) —

Third-party management and other fees

(326) (327) (636) (603)

Interest income

(431) (164) (580) (286)

Net operating income

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FFO is a widely recognized non-GAAP financial measure for REITs that we believe, when considered with financial statements determined in accordance with GAAP, is useful to investors in understanding financial performance and providing a relevant basis for comparison among REITs.

In addition, we believe FFO is useful to investors as it captures features particular to real estate performance by recognizing that real estate has generally appreciated over time or maintains residual value to a much greater extent than do other depreciable assets.

In addition, we believe

FFO is useful to investors as it captures features particular to real estate performance by recognizing that real estate has generally appreciated over time or maintains residual value to a much greater extent than do other depreciable assets.

Investors should review FFO, along with GAAP net income, when trying to understand an equity REIT’s operating performance.

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There can be no assurance that Modified FFO presented by us is comparable to similarly titled measures of other REITs.

Modified FFO does not represent

cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP.

Modified FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP.

Modified FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions.

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The following table presents a reconciliation of our net income, the most directly comparable GAAP measure, to FFO, Modified FFO and Core FFO for the periods presented (amounts in thousands):

Three months ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2022 2021 2022 2021

(unaudited) (unaudited)

$ 48,695 $ 4,411 $ 31,474 $ 1,220

Noncontrolling interests in other partnerships 159 — 222 —

3 unchanged sentences

56,571 43,480 121,985 86,584

FFO attributable to common stockholders

Gain on disposition of property

(27,170) — (27,170) —

FFO attributable to common unitholders

77,204 46,840 124,410 85,703

Amortization of below-market ground leases

Modified FFO attributable to common stockholders

1,958 1,958 3,916 3,916

Modified FFO attributable to common unitholders

79,162 48,798 128,326 89,619

Loss on early extinguishment of debt

Core FFO attributable to common stockholders

Core FFO attributable to common unitholders

$ 79,162 $ 48,798 $ 128,326 $ 89,833

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Factors That May Influence Future Results of Operations

We signed 1.0 million rentable square feet of new leases, expansions and lease renewals for the year ended December 31, 2021.

During the three months ended March 31, 2022, we signed 0.3 million rentable square feet of new leases, expansions and renewals.

Due to the relatively small number of leases that are signed in any particular quarter, one or more larger leases may have a disproportionately positive or negative impact on average rent, tenant improvement and leasing commission costs for that period.

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Leasing commission costs are similarly subject to significant fluctuations depending upon the length of leases being signed and the mix of tenants from quarter to quarter.

As of March 31, 2022, there were approximately 1.3 million rentable square feet of space in our portfolio available to lease (excluding leases signed but not yet commenced) representing 13.0% of the net rentable square footage of the properties in our portfolio.

As of June 30, 2022, there were approximately 1.2 million rentable square feet of space in our portfolio available to lease (excluding leases signed but not yet commenced) representing 12.2% of the net rentable square footage of the properties in our portfolio.

In addition, leases representing 3.4% and 6.2% of net rentable square footage of the properties in our portfolio will expire in 2022 and in 2023, respectively.

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Over the short-term, as we renovate and reposition our properties, including aggregating smaller spaces to offer large blocks of space, we may experience lower occupancy levels as a result of having to relocate tenants to alternative space and the strategic expiration of existing leases.

We believe that despite the short-term lower occupancy levels we may experience, we will continue to experience increased rental revenues as a result of the increased rents which we expect to obtain following the redevelopment and repositioning of our properties.

We believe that despite the short-term lower occupancy levels we may experience, we will continue to obtain better quality tenants, whom have higher likelihood for growth within the portfolio, following the redevelopment and repositioning of our properties.

Observatory Operations

For the three months ended March 31, 2022, the observatory hosted 269,000 visitors, compared to 51,000 visitors for the same period in 2021.

For the three months ended June 30, 2022, the observatory hosted 573,000 visitors, compared to 162,000 visitors for the same period in 2021.

Our return of attendance to pre-COVID-19 levels is closely tied to national and international travel trends and these remain adversely impacted by developments around the COVID-19 pandemic.

Observatory revenue for the three months ended March 31, 2022 was $13.2 million, compared to $2.6 million for the three months ended March 31, 2021.

Observatory revenue for the three months ended June 30, 2022 was $27.4 million, compared to $8.4 million for the three months ended June 30, 2021.

Observatory revenues and admissions are dependent upon the following:

8 unchanged sentences

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 2. Management’s Discussion and Analysis