Key Highlights

● Funds from operations, as adjusted, rose to $0.67 per diluted share from $0.56.

● Same-store net operating income rose 9.8 per cent on a GAAP basis.

● Vornado acquired a 49.0 per cent interest in Park Avenue Plaza for $1.1 billion gross.

● An $244.5 million loan on 888 Seventh Avenue remains in default under forbearance.

Vornado Realty Trust (NYSE:VNO), a New York-focused office and retail real estate investment trust whose common shares trade on the New York Stock Exchange under the symbol VNO, announced second-quarter 2026 results on 3 August 2026. Net income attributable to common shareholders was $16.4 million, or $0.08 per diluted share, compared with $743.8 million, or $3.70, a year earlier; the prior-year figure included an $803.2 million gain linked to the 770 Broadway master lease with New York University, so the comparison is distorted. Funds from operations, as adjusted, a non-GAAP measure standard among REITs, rose to $131.1 million, or $0.67 per diluted share, from $113.3 million, or $0.56. The company attributed the $17.8 million increase mainly to rent commencements, the 770 Broadway lease and higher signage income, partly offset by greater interest expense.

Leasing and occupancy

Same-store net operating income at share increased 9.8 per cent on a GAAP basis and 2.9 per cent on a cash basis. In New York office, Vornado leased 348,000 square feet in the quarter at an initial rent of $107.24 a square foot, with second-generation GAAP rent spreads of 7.7 per cent. New York retail leasing was 61,000 square feet at $277.05 a square foot. At 30 June 2026, New York occupancy at share was 90.8 per cent, comprising 92.2 per cent in office and 77.8 per cent in retail. THE MART in Chicago was 80.4 per cent occupied and 555 California Street in San Francisco 87.5 per cent, the latter showing a same-store NOI decline of 14.3 per cent.

Portfolio moves, financing and the balance sheet

On 11 June 2026 Vornado acquired a 49.0 per cent interest in Park Avenue Plaza at a gross valuation of $1.1 billion, with joint control alongside Fisher Brothers. Alexander's, in which Vornado owns 32.4 per cent, sold Rego Park I for $235.5 million. In financing, the company issued $500 million of 5.75 per cent senior notes due 2033, repaid $400 million of 2.15 per cent notes on 1 June. At the quarter end it held $675.4 million of cash, had drawn $918.0 million on its revolvers and carried $4.84 billion of mortgages payable. One item deserves attention: the $244.5 million loan on 888 Seventh Avenue matured in December 2025 and is in default, with a forbearance agreement running through March 2027. The company also repurchased 1,787,090 shares for $53.5 million in the quarter, at an average of $29.92, with $286.6 million of authorisation remaining on 3 August.

Manhattan Leasing Gains Offset a Troubled Loan

Vornado's core New York office and retail portfolio showed real leasing momentum, with 348,000 square feet leased at rising rent spreads and same-store income up on both a GAAP and cash basis. The company also closed its Park Avenue Plaza stake and refinanced $500 million of senior notes, but the $244.5 million 888 Seventh Avenue loan remains in default under a forbearance agreement running through March 2027, a reminder that not every asset in the portfolio is benefiting equally from the Manhattan leasing recovery.