1
Exhibit Index on Page 14
As filed with the Securities and Exchange Commission on August 12, 1998
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) JUNE 2, 1998
--------------------------------
Commission File Number: 1-11954
---------------------------------------------------------
VORNADO REALTY TRUST
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
MARYLAND 22-1657560
- --------------------------------------------------------------------------------
(State or other jurisdiction of incorporation) (I.R.S. Employer
Identification Number)
PARK 80 WEST, PLAZA II, SADDLE BROOK, NEW JERSEY 07663
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(201)587-1000
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
N/A
- --------------------------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
Page 1
2
ITEMS 1-4. NOT APPLICABLE
ITEM 5. On June 2, 1998 Vornado Realty Trust ("Vornado") entered into a
proposed Settlement Agreement relating to a purported class action
brought by certain limited partners of Mendik Real Estate Limited
Partnership ("Mendik RELP"), a publicly traded limited partnership.
Under the terms of the Settlement Agreement, Vornado will purchase from
the Mendik RELP (i) the Saxon Woods Corporate Center located in
Harrison, New York, (ii) a 60% interest in an office building located
at Two Park Avenue, in Manhattan (Vornado already owns the other 40%)
and (iii) an office building located at 330 West 34th Street, also in
Manhattan (collectively, the "Mendik RELP Properties"). The aggregate
purchase price is approximately $104 million, including assumed debt of
$39 million on the Two Park Avenue property.
The settlement, which is expected to be consummated in the third
quarter, is subject to the final negotiation and execution of a
definitive purchase and sale agreement and court approval; accordingly,
there can be no assurance that these transactions will be completed.
These transactions will be consummated through subsidiaries of Vornado
Realty L.P., a limited partnership of which Vornado owns a 92% limited
partnership interest at June 30, 1998 and is the sole general partner.
ITEM 6. NOT APPLICABLE
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
The Consolidated Financial Statements for Mendik Real Estate Limited
Partnership for the Year Ended December 31, 1997 and the Quarters Ended
March 31, 1998 and 1997 are incorporated herein by reference.
There are filed herewith:
The Condensed Consolidated Pro Forma Balance Sheet of Vornado as of March
31, 1998 and the Condensed Consolidated Pro Forma Income Statement of
Vornado for the three months ended March 31, 1998 and the year ended
December 31, 1997 commencing on page 5, prepared to give pro forma effect
to the proposed acquisition of the Mendik RELP Properties and the
previously reported acquisitions and investments reflected in the Form
8/K-A filed with the Securities and Exchange Commission on July 15, 1998
for the proposed acquisition of 888 Seventh Avenue, completed acquisitions
of 770 Broadway and the additional interest in 570 Lexington Avenue and
those previously reported acquisitions (Mendik Company, 90 Park Avenue,
Arbor Property Trust, Americold Corporation and URS Logistics, Inc., The
Montehiedra Town Center, The Riese Transaction, 15% investment in Charles
E. Smith Commercial Realty L.P., 40% investment in the Hotel Pennsylvania,
640 Fifth Avenue, One Penn Plaza, 150 East
Page 2
3
58th Street and the Merchandise Mart Group of Properties), and the
financings attributable thereto.
PAGE
REFERENCE
---------
Pro Forma financial information:
Condensed Consolidated Pro Forma Balance Sheet at
March 31, 1998.............................................. 5
Condensed Consolidated Pro Forma Income Statement
for the Three Months Ended March 31, 1998................... 6
Condensed Consolidated Pro Forma Income Statement for
the Year Ended December 31, 1997............................ 8
Notes to Condensed Consolidated Pro Forma Financial
Statements.................................................. 10
EXHIBIT NO. EXHIBIT
----------- -------
10 Item 14 of Form 10-K of Mendik Real Estate Limited Partnership
for the year ended December 31, 1997
10.1 Item 1 of Form 10-Q of Mendik Real Estate Limited Partnership
for the three months ended March 31, 1998
23 Consent of KPMG Peat Marwick LLP
ITEMS 8-9. NOT APPLICABLE.
Page 3
4
PRO FORMA FINANCIAL INFORMATION:
The unaudited condensed consolidated pro forma financial information
attached presents: (A) the Condensed Consolidated Pro Forma Income Statements of
Vornado Realty Trust ("Vornado") for the year ended December 31, 1997 and for
the three months ended March 31, 1998, as if the following had occurred on
January 1, 1997 (i) the proposed acquisitions of the Mendik RELP Properties with
the financings attributable thereto and (ii) the previously reported
acquisitions and investments reflected in the Form 8-K/A filed with the
Securities and Exchange Commission on July 15, 1998 for the proposed acquisition
of 888 Seventh Avenue, the completed acquisition of 770 Broadway and the
additional interest in 570 Lexington Avenue and previously reported acquisitions
(Mendik Company, 90 Park Avenue, Arbor Property Trust, Americold Corporation and
URS Logistics, Inc., The Montehiedra Town Center, The Riese Transaction, 15%
investment in Charles E. Smith Commercial Realty L.P., 40% investment in The
Hotel Pennsylvania, 640 Fifth Avenue, One Penn Plaza, 150 East 58th Street and
the Merchandise Mart Group of Properties) and the financings attributable
thereto and (B) the Condensed Consolidated Pro Forma Balance Sheet of Vornado as
of March 31, 1998, as if the above acquisitions had occurred on March 31, 1998.
The unaudited condensed consolidated pro forma financial information is
not necessarily indicative of what Vornado's actual results of operations or
financial position would have been had these transactions been consummated on
the dates indicated, nor does it purport to represent Vornado's results of
operations or financial position for any future period.
The unaudited condensed consolidated pro forma financial information
should be read in conjunction with the Consolidated Financial Statements and
notes thereto included in Vornado's Annual Report on Form 10-K for the year
ended December 31, 1997, the Consolidated Financial Statements and notes thereto
included in Vornado's Quarterly Report on Form 10-Q for the quarter ended March
31, 1998, the Consolidated Financial Statements and notes thereto included in
Mendik RELP's Annual Report on Form 10-K for the year ended December 31, 1997,
and the Consolidated Financial Statements and notes thereto of Mendik RELP's
Quarterly Report on Form 10-Q for the quarter ended March 31, 1998. In
management's opinion, all adjustments necessary to reflect these transactions
have been made.
Page 4
5
CONDENSED CONSOLIDATED PRO FORMA BALANCE SHEET
MARCH 31, 1998
(UNAUDITED)
(AMOUNTS IN THOUSANDS)
HISTORICAL
---------------------------
PREVIOUSLY
REPORTED COMPANY PRO FORMA TOTAL
VORNADO ACQUISITIONS PRO FORMA ADJUSTMENTS PRO FORMA
----------- ------------ ----------- -------------- -----------
ASSETS:
Real estate, net $ 1,942,728 $ 600,000 $ 2,810,728 $ 104,000 (A) $ 2,959,834
100,000 45,106 (C)
168,000
Cash and cash equivalents 299,761 (187,000) 70,761 (30,000) (A) 70,761
(31,000) 30,000 (B)
44,000
(55,000)
Investment in partially-owned
entities, including investment in
and advances to Alexander's 487,555 30,000 548,555 (19,106) (C) 529,449
31,000
Mortgage loans receivable 91,163 91,163 91,163
Receivable arising from straight-
lining of rents 27,776 27,776 27,776
Other assets 116,206 116,206 116,206
----------- --------- ----------- --------- -----------
$ 2,965,189 $ 700,000 $ 3,665,189 $ 130,000 $ 3,795,189
=========== ========= =========== ========= ===========
LIABILITIES:
Notes and mortgages payable $ 729,132 $ 327,000 $ 1,101,132 $ 39,000 (A) $ 1,166,132
45,000 26,000 (C)
Revolving credit facility 656,000 168,000 423,000 30,000 (B) 453,000
(401,000)
Deferred leasing fee income 10,026 10,026 10,026
Officer's deferred compensation
payable 25,000 25,000 25,000
Other liabilities 52,052 52,052 52,052
----------- --------- ----------- --------- -----------
1,472,210 139,000 1,611,210 95,000 1,706,210
----------- --------- ----------- --------- -----------
Minority interest of unitholders in the
Operating Partnership 178,965 116,000 294,965 294,965
----------- --------- ----------- --------- -----------
EQUITY:
Total equity 1,314,014 401,000 1,759,014 35,000 (A) 1,794,014
44,000
----------- --------- ----------- --------- -----------
$ 2,965,189 $ 700,000 $ 3,665,189 $ 130,000 $ 3,795,189
=========== ========= =========== ========= ===========
Page 5
6
CONDENSED CONSOLIDATED PRO FORMA INCOME STATEMENT
FOR THE QUARTER ENDED MARCH 31, 1998
(UNAUDITED)
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
PREVIOUSLY HISTORICAL
HISTORICAL REPORTED COMPANY MENDIK PRO FORMA TOTAL
VORNADO ACQUISITIONS PRO FORMA RELP ADJUSTMENTS PRO FORMA
---------- ------------ --------- ---------- ----------- ---------
REVENUES:
Property rentals $ 72,365 $ 43,549 $ 115,914 $ 9,261 $ 658 (D) $125,833
Expense reimbursements 15,696 2,336 18,032 -- -- 18,032
Other income 2,150 1,730 3,880 -- -- 3,880
-------- --------- --------- --------- --------- --------
90,211 47,615 137,826 9,261 658 147,745
-------- --------- --------- --------- --------- --------
EXPENSES:
Operating 34,153 22,566 56,719 4,797 -- 61,516
Depreciation and amortization 10,366 6,065 16,431 49 569 (E) 17,049
General and administrative 4,947 -- 4,947 43 -- 4,990
-------- --------- --------- --------- --------- --------
49,466 28,631 78,097 4,889 569 83,555
-------- --------- --------- --------- --------- --------
Operating income 40,745 18,984 59,729 4,372 89 64,190
Income applicable to Alexander's 1,656 -- 1,656 -- -- 1,656
Income from partially owned entities 3,920 474 4,394 -- (433) (F) 3,961
Interest and other investment
income 7,566 (515) 7,051 63 -- 7,114
Interest and debt expense (19,823) (3,374) (23,197) (1,387) (488) (G) (25,072)
Minority interest of unitholders in
the Operating Partnership (2,577) (1,797) (4,374) (955) 955 (H) (4,943)
(569) (I)
-------- --------- --------- --------- --------- --------
Net income 31,487 13,772 45,259 2,093 (446) 46,906
Preferred stock dividends (5,423) -- (5,423) -- -- (5,423)
-------- --------- --------- --------- --------- --------
Net income applicable to
common shares $ 26,064 $ 13,772 $ 39,836 $ 2,093 $ (446) $ 41,483
======== ========= ========= ========= ========= ========
Net income per common share - basic
(based on 72,165 shares and
84,274 shares) $ 0.36 $ 0.49
======== ========
Net income per common share - diluted
(based on 74,343 shares and
86,462 shares) $ 0.35 $ 0.48
======== ========
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CONDENSED CONSOLIDATED PRO FORMA INCOME STATEMENT
FOR THE QUARTER ENDED MARCH 31, 1998
(UNAUDITED)
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
PREVIOUSLY HISTORICAL
HISTORICAL REPORTED COMPANY MENDIK PRO FORMA TOTAL
VORNADO ACQUISITIONS PRO FORMA RELP ADJUSTMENTS PRO FORMA
---------- ------------ ----------- ---------- ----------- -----------
OTHER DATA:
Funds from Operations (1):
Net income applicable to
common shares $ 26,064 $ 13,772 $ 39,836 $ 2,093 $ (446) $ 41,483
Depreciation and amortization
of real property 10,194 6,065 16,259 49 569 16,877
Straight-lining of property rent
escalations (2,292) (3,253) (5,545) (485) (714) (6,744)
Leasing fees received in excess
of income recognized 368 -- 368 -- -- 368
Proportionate share of adjustments
to income from equity
investments to arrive at FFO 10,947 275 11,222 -- 439 11,661
Minority Interest in excess of
preferential distributions (353) (945) (1,298) (167) 14 (1,451)
--------- ----------- ----------- ------- -------- -----------
$ 44,928 $ 15,914 $ 60,842 $ 1,490 $ (138) $ 62,194
========= =========== =========== ======= ======== ===========
CASH FLOW PROVIDED BY (USED IN):
Operating activities $ 33,573 $ 17,644 $ 51,217 $ 107 $ 26 $ 51,350
Investing activities $(543,865) $(1,457,000) $(2,000,865) $ (115) $(30,000) $(2,030,980)
Financing activities $ 390,995 $ 1,434,000 $ 1,824,995 $ -- $ 35,000 $ 1,859,995
- -----------
(1) Funds from operations does not represent cash generated from operating
activities in accordance with generally accepted accounting principles
and is not necessarily indicative of cash available to fund cash needs
which is disclosed in the Consolidated Statements of Cash Flows for the
applicable periods. There are no material legal or functional
restrictions on the use of funds from operations. Funds from operations
should not be considered as an alternative to net income as an
indicator of the Company's operating performance or as an alternative
to cash flows as a measure of liquidity. Management considers funds
from operations a supplemental measure of operating performance and
along with cash flow from operating activities, financing activities,
and investing activities, it provides investors with an indication of
the ability of the Company to incur and service debt, to make capital
expenditures and to fund other cash needs. Funds from operations may
not be comparable to similarly titled measures employed by other REITs
since a number of REITs, including the Company's, method of calculating
funds from operations is different from that used by NAREIT. Funds from
operations, as defined by NAREIT, represents net income applicable to
common shares before depreciation and amortization, extraordinary items
and gains or losses on sales of real estate. Funds from operations as
disclosed above has been modified to adjust for the effect of
straight-lining of property rentals for rent escalations and leasing
fee income.
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CONDENSED CONSOLIDATED PRO FORMA INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 1997
(UNAUDITED)
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
PREVIOUSLY HISTORICAL
HISTORICAL REPORTED COMPANY MENDIK PRO FORMA TOTAL
VORNADO ACQUISITIONS PRO FORMA RELP ADJUSTMENTS PRO FORMA
---------- ------------ --------- ---------- ----------- ---------
REVENUES:
Property rentals $ 168,321 $ 280,815 $ 449,136 $ 36,189 $ 3,471 (J) $ 488,796
Expense reimbursements 36,652 36,991 73,643 -- -- 73,643
Other income 4,158 13,389 17,547 2,921 (2,921) (P) 17,547
--------- --------- --------- --------- --------- ---------
209,131 331,195 540,326 39,110 550 579,986
--------- --------- --------- --------- --------- ---------
EXPENSES:
Operating 74,745 158,300 233,045 20,827 -- 253,872
Depreciation and amortization 22,983 43,745 66,728 5,247 (2,780) (K) 69,195
General and administrative 13,580 4,026 17,606 636 -- 18,242
Amortization of officer's deferred
compensation expense 22,917 -- 22,917 -- -- 22,917
--------- --------- --------- --------- --------- ---------
134,225 206,071 340,296 26,710 (2,780) 364,226
--------- --------- --------- --------- --------- ---------
Operating income 74,906 125,124 200,030 12,400 3,330 215,760
Income applicable to Alexander's 7,873 -- 7,873 -- -- 7,873
Income from partially owned entities 4,658 6,674 11,332 -- (672) (L) 10,660
Interest and other investment
income 23,767 (3,830) 19,937 245 -- 20,182
Interest and debt expense (42,888) (57,967) (100,855) (6,162) (1,950) (M) (108,967)
Minority interest of unitholders in
the Operating Partnership (7,293) (9,010) (16,303) (1,370) 1,370 (N) (17,147)
(844) (O)
--------- --------- --------- --------- --------- ---------
Net income 61,023 60,991 122,014 5,113 1,234 128,361
Preferred stock dividends (15,549) (5,137) (20,686) -- -- (20,686)
--------- --------- --------- --------- --------- ---------
Net income applicable to
common shares $ 45,474 $ 55,854 $ 101,328 $ 5,113 $ 1,234 $ 107,675
========= ========= ========= ========= ========= =========
Net income per common share - basic
(based on 55,098 shares and
84,274 shares) $ 0.83 $ 1.28
========= =========
Net income per common share - diluted
(based on 57,217 shares and
86,462 shares) $ 0.79 $ 1.25
========= =========
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CONDENSED CONSOLIDATED PRO FORMA INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 1997
(UNAUDITED)
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
PREVIOUSLY HISTORICAL
HISTORICAL REPORTED COMPANY MENDIK PRO FORMA TOTAL
VORNADO ACQUISITIONS PRO FORMA RELP ADJUSTMENTS PRO FORMA
----------- ------------ ----------- ---------- ----------- -----------
OTHER DATA:
Funds from Operations (1):
Net income applicable to
common shares $ 45,474 $ 55,854 $ 101,328 $ 5,113 $ 1,234 $ 107,675
Depreciation and amortization
of real property 22,413 42,119 64,532 5,247 (2,780) 66,999
Straight-lining of property rent
escalations (3,359) (26,131) (29,490) (738) (3,002) (33,230)
Leasing fees received in excess
of income recognized 1,733 -- 1,733 -- -- 1,733
Proportionate share of adjustments
to income from equity
investments to arrive at FFO 6,358 31,635 37,993 -- 1,360 39,353
Non-recurring lease cancellation
income and write-off of related
costs -- (11,581) (11,581) -- -- (11,581)
Minority interest in excess of
preferential distributions -- (390) (390) (1,931) 677 (1,644)
----------- ----------- ----------- ------- --------- -----------
$ 72,619 $ 91,506 $ 164,125 $ 7,691 $ (2,511) $ 169,305
=========== =========== =========== ======= ========= ===========
CASH FLOW PROVIDED BY (USED IN):
Operating activities $ 110,754 $ 77,446 $ 188,200 $ 7,628 $ (2,511) $ 381,517
Investing activities $(1,064,484) $(1,801,384) $(2,865,868) $(7,003) $ (30,000) $(2,902,871)
Financing activities $ 1,219,988 $ 1,665,384 $ 2,885,372 $ (566) $ 35,000 $ 2,919,806
- -----------
(1) Funds from operations does not represent cash generated from operating
activities in accordance with generally accepted accounting principles
and is not necessarily indicative of cash available to fund cash needs
which is disclosed in the Consolidated Statements of Cash Flows for the
applicable periods. There are no material legal or functional
restrictions on the use of funds from operations. Funds from operations
should not be considered as an alternative to net income as an
indicator of the Company's operating performance or as an alternative
to cash flows as a measure of liquidity. Management considers funds
from operations a supplemental measure of operating performance and
along with cash flow from operating activities, financing activities,
and investing activities, it provides investors with an indication of
the ability of the Company to incur and service debt, to make capital
expenditures and to fund other cash needs. Funds from operations may
not be comparable to similarly titled measures employed by other REITs
since a number of REITs, including the Company's, method of calculating
funds from operations is different from that used by NAREIT. Funds from
operations, as defined by NAREIT, represents net income applicable to
common shares before depreciation and amortization, extraordinary items
and gains or losses on sales of real estate. Funds from operations as
disclosed above has been modified to adjust for the effect of
straight-lining of property rentals for rent escalations and leasing
fee income.
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NOTES TO CONDENSED CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
(amounts in thousands, except per share amounts)
The column headed "Historical Mendik RELP" included in the Condensed
Consolidated Pro Forma Income Statement for the quarter ended March 31, 1998 and
the year ended December 31, 1997, includes the revenues and expenses from the
Mendik RELP's Consolidated Statement of Operations for the three months ended
March 31, 1998 as filed on Mendik RELP's Form 10-Q and the Consolidated
Statement of Operations for the year ended December 31, 1997 as filed on Mendik
RELP's Form 10-K. These amounts include the 40% interest in Two Park Avenue that
is owned by Vornado and accordingly, adjustments are required to eliminate this
equity investment. Such adjustments are included in the column headed "Pro Forma
Adjustments".
The unaudited Condensed Consolidated Pro Forma Financial Statements were
prepared to give pro forma effect to the proposed acquisition of the Mendik RELP
Properties (330 West 34th Street, Saxon Woods Corporate Center and the
additional 60% interest in Two Park Avenue), the previously reported completed
acquisitions and investments or proposed acquisitions (Mendik Company, 90 Park
Avenue, Arbor Property Trust, Americold Corporation and URS Logistics, Inc., The
Montehiedra Town Center, The Riese Transaction, 15% investment in Charles E.
Smith Commercial Realty L.P., 40% investment in The Hotel Pennsylvania, 640
Fifth Avenue, One Penn Plaza, 150 East 58th Street, the Merchandise Mart Group
of Properties, 888 Seventh Avenue, 770 Broadway and additional interest in 570
Lexington Avenue (all included in the column headed "Previously Reported
Acquisitions")) and the financings attributable thereto, for the period of time
during 1998 prior to their acquisition. The Pro Forma data for certain
previously completed acquisitions, which were disclosed in Form 8-K's previously
filed with the Securities and Exchange Commission has been updated to (i)
include information through March 31, 1998 and (ii) reflect pro forma
adjustments to revenues for straight-line rents for the period, depreciation
adjustments based upon the new basis of the acquired assets, interest expense on
debt used to fund the acquisition and additional minority interest.
Acquisitions were consummated through subsidiaries or preferred stock affiliates
of Vornado and were recorded under the purchase method of accounting. Net assets
have been included in these financial statements since their respective dates of
acquisition. The respective purchase costs were allocated to acquired assets and
assumed liabilities using their relative fair values as of the closing dates,
based on valuations and other studies which are not yet complete. Accordingly,
the initial valuations are subject to change as such information is finalized.
Vornado believes that any such change will not be significant since the
allocations were principally to real estate.
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NOTES TO CONDENSED CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
(CONTINUED)
(amounts in thousands, except per share amounts)
The following adjustments were required to give pro forma effect to the
transactions being reported:
Pro Forma March 31, 1998 Balance Sheet:
(A) Reflects the acquisition of 330 West 34th Street, the Saxon
Woods Corporate Center and the additional 60% interest in Two
Park Avenue for approximately $104 million, consisting of $30
million in cash, the issuance of $35 million of common shares
(based upon an assumed price of $37.00 per share) and assumed
debt of $39 million on the Two Park Avenue Property.
(B) Reflects borrowings under the revolving credit facility to
fund the cash portion of the purchase price.
(C) Reflects the reclassification of the equity investment in the
original 40% interest in Two Park Avenue into its balance
sheet components.
Pro Forma March 31, 1998 Income Statement:
(D) To adjust property rentals arising from the straight-lining of
tenant leases that contain escalations over the lease term.
(E) To adjust depreciation expense for the new basis of the
acquired assets, offset by the elimination of historical
depreciation as recorded on the Mendik RELP income statement.
(F) To eliminate income accounted for under the equity method on
the original 40% interest in Two Park Avenue included in
Vornado's historical income statement.
(G) To record interest expense from borrowings on the revolving
credit facility used to finance the cash portion of the
acquisition at an assumed borrowing rate of 6.5%.
(H) To eliminate historical minority interest in the Mendik RELP.
(I) To record incremental income allocable to minority interest
holders.
Pro Forma December 31, 1998 Income Statement
(J) To adjust property rentals arising from the straight-lining of
tenant leases that contain escalations over the lease term.
(K) To adjust depreciation expense for the new basis of the
acquired assets, offset by the elimination of historical
depreciation as recorded on the Mendik RELP income statement.
(L) To eliminate income accounted for under the equity method on
the original 40% interest in Two Park Avenue included in
Vornado's historical income statement.
(M) To record interest expense from borrowings on the revolving
credit facility used to finance the cash portion of the
acquisition at an assumed borrowing rate of 6.5%.
(N) To eliminate historical minority interest in the Mendik RELP.
(O) To record incremental income allocable to minority interest
holders.
(P) To eliminate gain which would not be a part of the proposed
future operations of the properties being acquired.
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NOTES TO CONDENSED CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
(CONTINUED)
(amounts in thousands, except per share amounts)
The pro forma adjustments as described above reflect the use of $30,000 in cash
for the purchase of the Saxon Woods Corporate Center and 340 West 34th Street
and the issuance $35,000 of common shares to finance the acquisition of the
additional 60% interest in Two Park Avenue. This allocation is based upon
preliminary information. At closing, if $65,000 of cash is used to finance the
entire transaction and no shares are issued, pro forma net income would be
$41,275 ($.48 per diluted share) and $105,400 ($1.23 per diluted share) for the
three months ended March 31, 1998 and the year ended December 31, 1997
Page 12
13
VORNADO REALTY TRUST
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
VORNADO REALTY TRUST
--------------------------
(Registrant)
Date: August 12, 1998 /s/ Irwin Goldberg
--------------------------
IRWIN GOLDBERG
Vice President,
Chief Financial Officer
Page 13
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INDEX TO EXHIBITS
EXHIBIT NO. EXHIBIT
----------- -------
10 Item 14 of Form 10-K of Mendik Real Estate Limited Partnership
for the year ended December 31, 1997
10.1 Item 1 of Form 10-Q of Mendik Real Estate Limited Partnership
for the three months ended March 31, 1998
23 Consent of KPMG Peat Marwick LLP
Page 14