1
                                                                     EXHIBIT 8.1





                                                               December 20, 1996



Vornado Realty Trust,
   Park 80 West, Plaza II,
      Saddle Brook, NJ 07663.

Dear Sirs:

                 You have requested our opinion in connection with the
qualification for United States federal income tax purposes of Vornado Realty
Trust ("Vornado") as a real estate investment trust (a "REIT"), within the
meaning of section 856(a) of the Internal Revenue Code of 1986, as amended (the
"Code").

                 In rendering this opinion, we have relied upon (i) the
statements and representations contained in (x) the letter to us from Vornado
dated December 20, 1996 (the "Vornado Representation Letter"), and (y) the
letter to us from Alexander's, Inc.  ("Alexander's") dated December 20, 1996
(together with the Vornado Representation Letter, the "Representation
Letters")), and (ii) the opinion of Shearman & Sterling, dated December 20,
1996, concerning the qualification of Alexander's as a REIT, a copy of which is
attached as Exhibit A (the "Shearman & Sterling Opinion").  In rendering this
opinion we have also assumed, with your approval, that (I) the statements and
representations made in the Representation Letters are true and correct, (II)
the Representation Letters have been executed by appropriate and
   2
Vornado Realty Trust                                                         -2-



authorized officers of Vornado and Alexander's and (III) the assumptions and
conditions underlying the Shearman & Sterling Opinion are true and correct.

                 Based on the foregoing and in reliance thereon and subject
thereto and on an analysis of the Code, Treasury Regulations thereunder,
judicial authority and current administrative rulings and such other laws and
facts as we have deemed relevant and necessary, we hereby confirm (i) that we
have reviewed the statements made in the Prospectus of Vornado dated December
26, 1995 (the "Prospectus") under the heading "Federal Income Tax
Considerations", as supplemented by the discussion set forth in the Prospectus
Supplement of Vornado dated December 18, 1996 (the "Prospectus Supplement")
under the heading "Certain Federal Income Tax Considerations" and, to the
extent that such statements constitute matters of law or legal conclusions,
such statements are correct in all material respects, and (ii) our opinion
that, commencing with its taxable year ending December 31, 1993, Vornado has
been organized in conformity with the requirements for qualification as a REIT
under the Code, and its proposed method of operation will enable it to satisfy
the requirements for qualification and taxation as a REIT.

                 Vornado's qualification as a REIT will depend upon the
continuing satisfaction by Vornado and its subsidiaries and, given Vornado's
current ownership interest in Alexander's, by Alexander's and its subsidiaries
(collectively with Vornado, the "Company") of requirements of the Code relating
to qualification for REIT status; which requirements include those that are
dependent upon actual operating results, distribution levels, diversity of
stock





   3
Vornado Realty Trust                                                         -3-


ownership, asset composition, source of income and recordkeeping.  We do not
undertake to monitor whether the Company actually has satisfied or will satisfy
the various qualification tests, and we express no opinion concerning whether
the Company actually has satisfied or will satisfy these various qualification
tests.

                 This opinion is based on current federal income tax law, and
we do not undertake to advise you as to future changes in federal income tax
law that may affect this opinion unless we are specifically engaged to do so.
This opinion relates solely to federal income tax law, and we do not undertake
to render any opinion as to the taxation of Vornado under any state or local
corporate franchise or income tax law.  Furthermore, this opinion is rendered
solely for your benefit and is not to be relied upon by any other person
without our prior written consent.

                 We hereby consent to (i) the use of our name and the making of
statements with respect to us as set forth under the heading "Federal Income
Tax Considerations" in the Prospectus and the heading "Certain Federal Income
Tax Considerations" in the Prospectus Supplement and (ii) the incorporation by
reference of this opinion into Registration Statement No. 33-52441 and into
Registration Statement No. 33-62395.  In giving such consent, we do not thereby
admit that we are within the category of persons whose consent is required
under Section 7 of the Securities Act of 1933, as amended.

                                        Very truly yours,

                                        SULLIVAN & CROMWELL