Investments in Unconsolidated Joint Ventures

We have investments in several real estate joint ventures with various partners. As of June 30, 2016, 650 Fifth Avenue, 800 Third Avenue, 21 East 66th Street, 605 West 42^nd Street and certain properties within the Stonehenge Portfolio are VIEs in which we are not the primary beneficiary. Our net equity investment in these VIEs was $216.9 million as of June 30, 2016. As of December 31, 2015, 650 Fifth Avenue and 33 Beekman were VIEs in which we were not the primary beneficiary. Our net equity investment in these VIEs was $39.7 million as of December 31, 2015. Our maximum loss is limited to the amount of our equity investment in these VIEs. All other investments below are voting interest entities. As we do not control the joint ventures listed below, we account for them under the equity method of accounting.

The table below provides general information on each of our joint ventures as of June 30, 2016:



Property	Partner	Ownership Interest	Economic Interest	Approximate Square Feet	Acquisition Date	Acquisition Price⁽¹⁾ (in thousands)
100 Park Avenue	Prudential Real Estate Investors	49.90%	49.90%	834,000	January 2000	$	95,800
717 Fifth Avenue	Jeff Sutton/Private Investor	10.92%	10.92%	119,500	September 2006	251,900
800 Third Avenue	Private Investors	60.52%	60.52%	526,000	December 2006	285,000
1745 Broadway	Ivanhoe Cambridge, Inc.	56.88%	56.88%	674,000	April 2007	520,000
Jericho Plaza ⁽²⁾	Onyx Equities/Private Investor	11.67%	11.67%	640,000	April 2007	210,000
11 West 34th Street	Private Investor/ Jeff Sutton	30.00%	30.00%	17,150	December 2010	10,800
3 Columbus Circle⁽³⁾	The Moinian Group	48.90%	48.90%	741,500	January 2011	500,000
280 Park Avenue	Vornado Realty Trust	50.00%	50.00%	1,219,158	March 2011	400,000
1552-1560 Broadway⁽⁴⁾	Jeff Sutton	50.00%	50.00%	35,897	August 2011	136,550
724 Fifth Avenue	Jeff Sutton	50.00%	50.00%	65,040	January 2012	223,000
10 East 53rd Street	Canadian Pension Plan Investment Board	55.00%	55.00%	354,300	February 2012	252,500
521 Fifth Avenue	Plaza Global Real Estate Partners LP	50.50%	50.50%	460,000	November 2012	315,000
21 East 66th Street⁽⁵⁾	Private Investors	32.28%	32.28%	16,736	December 2012	75,000
650 Fifth Avenue⁽⁶⁾	Jeff Sutton	50.00%	50.00%	32,324	November 2013
121 Greene Street	Jeff Sutton	50.00%	50.00%	7,131	September 2014	27,400
175-225 Third Street Brooklyn, New York	KCLW 3rd Street LLC/LIVWRK LLC	95.00%	95.00%	—	October 2014	74,600
55 West 46th Street	Prudential Real Estate Investors	25.00%	25.00%	347,000	November 2014	295,000
Stonehenge Portfolio	Various	Various	Various	2,046,733	Various	36,668
131-137 Spring Street	Invesco Real Estate	20.00%	20.00%	68,342	August 2015	277,750
76 11th Avenue⁽⁷⁾	Oxford/Vornado	33.33%	36.58%	764,000	March 2016	138,240
605 West 42nd Street⁽⁸⁾	The Moinian Group	20.00%	20.00%	927,358	April 2016	759,000


(1)	Acquisition price represents the actual or implied gross purchase price for the joint venture, which is not adjusted for subsequent acquisitions of additional interests.


(2)	Our ownership percentage was reduced in the first quarter of 2016, from 77.78% to 11.67%, upon completion of the restructuring of the joint venture.


(3)	As a result of the sale of a condominium interest in September 2012, Young & Rubicam, Inc., or Y&R, owns floors three through eight at the property. Because the joint venture has an option to repurchase these floors, the gain associated with this sale was deferred.


(4)	The purchase price represents only the purchase of the 1552 Broadway interest which comprised approximately 13,045 square feet. The joint venture also owns a long-term leasehold interest in the retail space and certain other spaces at 1560 Broadway, which is adjacent to 1552 Broadway.


(5)	We hold a 32.28% interest in three retail and two residential units at the property and a 16.14% interest in three residential units at the property.

(6)

The joint venture owns a long-term leasehold interest in the retail space at 650 Fifth Avenue. In connection with the ground lease obligation, SLG provided a performance guaranty and our joint venture partner executed a contribution agreement to reflect its pro rata obligation. In the event the property is converted into a condominium unit and the landlord elects the purchase option, the joint venture shall be obligated to acquire the unit at the then fair value.


(7)	The joint venture owns two mezzanine notes secured by interests in the entity that owns 76 11th Avenue. The difference between our ownership interest and our economic interest results from our right to 50% of the total exit fee while each of our partners is entitled to receive 25% of the total exit fee.


(8)	The Company was granted an option to purchase the interest at an agreed upon valuation in July 2014 when it originated a $50.0 million mezzanine loan to the project's developer. The mezzanine loan was repaid prior to the closing of the Company's acquisition of its joint venture interest.

Acquisition, Development and Construction Arrangements

Based on the characteristics of the following arrangements, which are similar to those of an investment, combined with the expected residual profit of not greater than 50%, we have accounted for these debt and preferred equity investments under the equity method. As of June 30, 2016 and December 31, 2015, the carrying value for acquisition, development and construction arrangements were as follows (in thousands):



Loan Type	June 30, 2016		December 31, 2015		Initial Maturity Date
Mezzanine loan and preferred equity	$	100,000	$	99,936	March 2017
Mezzanine loan⁽¹⁾	45,719		45,942		February 2022
	$	145,719	$	145,878


(1)	We have an option to convert our loan to an equity interest subject to certain conditions. We have determined that our option to convert the loan to equity is not a derivative financial instrument pursuant to GAAP.

Sale of Joint Venture Interest or Property

The following table summarizes the investments in unconsolidated joint ventures sold during the six months ended June 30, 2016:



Property	Ownership Percentage	Disposition Date	Type of Sale	Gross Asset Valuation (in thousands)⁽¹⁾		Gain on Sale (in thousands)⁽²⁾
1 Jericho Plaza ⁽³⁾	66.11%	February 2016	Office	$	95,200	$	3,300
7 Renaissance Square	50.00%	March 2016	Office	$	20,700	$	4,200
EOP Denver	4.79%	March 2016	Office	$	180,700	$	2,800
33 Beekman ⁽⁴⁾	45.90%	May 2016	Residential	$	196,000	$	33,000


(1)	Represents implied gross valuation for the joint venture or sales price of the property.


(2)	Represents the Company's share of the gain. The gain on sale is net of $1.1 million employee compensation awards accrued in connection with the realization of these investment gains as a bonus to certain employees that were instrumental in realizing the gains on sale.


(3)	Our ownership percentage was reduced in the first quarter of 2016, from 77.78% to 11.67%, upon completion of the restructuring of the joint venture.


(4)	In connection with the sale of the property, we also recognized a promote of $10.8 million.

Mortgages and Other Loans Payable

We generally finance our joint ventures with non-recourse debt. However, in certain cases we have provided guarantees or master leases for tenant space. These guarantees and master leases terminate upon the satisfaction of specified circumstances or repayment of the underlying loans. The first mortgage notes and other loans payable collateralized by the respective joint venture properties and assignment of leases at June 30, 2016 and December 31, 2015, respectively, are as follows (amounts in thousands):



Property	Maturity Date	Interest Rate⁽¹⁾		June 30, 2016		December 31, 2015
Fixed Rate Debt:
1745 Broadway	January 2017	5.68	%	$	340,000	$	340,000
521 Fifth Avenue	November 2019	3.73	%	170,000		170,000
717 Fifth Avenue⁽²⁾	July 2022	4.45	%	300,000		300,000
717 Fifth Avenue⁽²⁾	July 2022	6.27	%	355,328		325,704
21 East 66th Street	April 2023	3.60	%	12,000		12,000
3 Columbus Circle	March 2025	3.61	%	350,000		350,000
800 Third Avenue	February 2026	3.17	%	177,000		20,910
Stonehenge Portfolio⁽³⁾	Various	4.19	%	364,249		430,627
280 Park Avenue				—		692,963



Property	Maturity Date	Interest Rate⁽¹⁾		June 30, 2016			December 31, 2015
7 Renaissance Square				—			2,927
Total fixed rate debt				$	2,068,577		$	2,645,131
Floating Rate Debt:
650 Fifth Avenue ⁽⁴⁾	October 2016	3.94	%	$	65,000		$	65,000
175-225 Third Street	December 2016	4.50	%	40,000			40,000
10 East 53rd Street	February 2017	2.94	%	125,000			125,000
724 Fifth Avenue	April 2017	2.86	%	275,000			275,000
1552 Broadway ⁽⁵⁾	April 2017	4.66	%	185,410			190,409
55 West 46th Street ⁽⁶⁾	October 2017	2.74	%	151,536			150,000
Jericho Plaza⁽⁷⁾	March 2018	4.59	%	75,799			163,750
605 West 42nd Street	July 2018	2.56	%	539,000			—
280 Park Avenue	June 2019	2.44	%	900,000			30,000
121 Greene Street	November 2019	1.94	%	15,000			15,000
131-137 Spring Street	August 2020	1.99	%	141,000			141,000
11 West 34th Street	January 2021	1.89	%	23,000			23,000
100 Park Avenue	February 2021	2.19	%	360,000			360,000
21 East 66th Street	June 2033	2.00	%	1,765			1,805
Stonehenge Portfolio⁽⁸⁾	Various	5.81	%	65,489			10,500
33 Beekman				—			73,518
Total floating rate debt				$	2,962,999		$	1,663,982
Total joint venture mortgages and other loans payable				$	5,031,576		$	4,309,113
Deferred financing costs, net				(109,083		)	(42,565		)
Total joint venture mortgages and other loans payable, net				$	4,922,493		$	4,266,548


(1)	Effective weighted average interest rate for the three months ended June 30, 2016, taking into account interest rate hedges in effect during the period.


(2)	These loans are comprised of a $300.0 million fixed rate mortgage loan and $355.3 million mezzanine loan. The mezzanine loan is subject to accretion based on the difference between contractual interest rate and contractual pay rate.


(3)	Amount is comprised of $13.2 million, $34.6 million, , $140.3 million, and $176.2 million in fixed-rate mortgages that mature in October 2016, November 2017, August 2019, and June 2024, respectively.


(4)	This loan has a committed amount of $97.0 million, of which $32.0 million was unfunded as of June 30, 2016.


(5)	These loans are comprised of a $145.0 million mortgage loan and a $41.5 million mezzanine loan. As of June 30, 2016, $0.6 million of the mortgage loan and $0.5 million of the mezzanine loan were unfunded.


(6)	This loan has a committed amount of $190.0 million, of which $38.5 million was unfunded as of June 30, 2016.


(7)	We hold an 11.67% non-controlling interest in the joint venture and the property secures a two year $100.0 million loan, of which $75.8 million is currently outstanding.


(8)	Amount is comprised of $55.2 million and $10.3 million in floating-rate mortgages that mature in June 2017 and December 2017, respectively.

We act as the operating partner and day-to-day manager for all our joint ventures, except for 800 Third Avenue, Jericho Plaza, 280 Park Avenue, 3 Columbus Circle, 21 East 66th Street, 175-225 Third Street, 605 West 42nd Street and the Stonehenge Portfolio. We are entitled to receive fees for providing management, leasing, construction supervision and asset management services to certain of our joint ventures. We incurred a $2.0 million loss and earned $2.5 million, $2.1 million and $4.9 million from these services for the three and six months ended June 2016 and 2015, respectively. In addition, we have the ability to earn incentive fees based on the ultimate financial performance of certain of the joint venture properties.

The combined balance sheets for the unconsolidated joint ventures, at June 30, 2016 and December 31, 2015 are as follows (in thousands):



	June 30, 2016		December 31, 2015
Assets
Commercial real estate property, net	$	6,510,775	$	6,122,468
Debt and preferred equity investments, net	304,901		145,878
Other assets	741,839		715,840
Total assets	$	7,557,515	$	6,984,186
Liabilities and members' equity
Mortgages and other loans payable, net	$	4,922,493	$	4,266,548
Other liabilities	534,611		523,160
Members' equity	2,100,411		2,194,478
Total liabilities and members' equity	$	7,557,515	$	6,984,186
Company's investments in unconsolidated joint ventures	$	1,126,486	$	1,203,858

The combined statements of operations for the unconsolidated joint ventures, from acquisition date through the three and six months ended June 30, 2016 and 2015, are as follows (in thousands):



	Three Months Ended June 30,					Six Months Ended June 30,
	2016		2015			2016			2015
Total revenues	$	151,575	$	143,535		$	314,087		$	272,451
Operating expenses	27,166		26,345			54,420			51,831
Ground rent	3,715		2,572			6,926			5,164
Real estate taxes	24,332		22,335			48,542			41,711
Interest expense, net of interest income	46,351		51,715			96,087			95,722
Amortization of deferred financing costs	7,276		3,145			10,512			6,155
Transaction related costs	—		3			—			11
Depreciation and amortization	37,294		37,894			75,145			70,878
Total expenses	146,134		144,009			291,632			271,472
Loss on early extinguishment of debt	—		—			(1,606		)	(833		)
Net income (loss) before gain on sale	$	5,441	$	(474	)	$	20,849		$	146
Company's equity in net income from unconsolidated joint ventures	$	5,841	$	2,994		$	15,937		$	7,024