Investments in Unconsolidated Joint Ventures (Tables)

6 Months Ended

Jun. 30, 2019

Schedule of Equity Method Investments [Line Items]

Schedule of general information on joint ventures

The table below provides general information on each of our joint ventures as of June 30, 2019:



Property	Partner	Ownership Interest⁽¹⁾	Economic Interest⁽¹⁾	Unaudited Approximate Square Feet	Acquisition Date⁽²⁾	Gross Asset Valuation⁽²⁾(in thousands)
100 Park Avenue	Prudential Real Estate Investors	49.90%	49.90%	834,000	February 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
919 Third Avenue⁽³⁾	New York State Teacher's Retirement System	51.00%	51.00%	1,454,000	January 2007	1,256,727
11 West 34th Street	Private Investor/ Jeff Sutton	30.00%	30.00%	17,150	December 2010	10,800
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%	57,718	August 2011	136,550
10 East 53rd Street	Canadian Pension Plan Investment Board	55.00%	55.00%	354,300	February 2012	252,500
21 East 66th Street⁽⁵⁾	Private Investors	32.28%	32.28%	13,069	December 2012	75,000
650 Fifth Avenue⁽⁶⁾	Jeff Sutton	50.00%	50.00%	69,214	November 2013	—
121 Greene Street	Jeff Sutton	50.00%	50.00%	7,131	September 2014	27,400
55 West 46th Street	Prudential Real Estate Investors	25.00%	25.00%	347,000	November 2014	295,000
Stonehenge Portfolio⁽⁷⁾	Various	Various	Various	1,439,016	February 2015	36,668
605 West 42nd Street	The Moinian Group	20.00%	20.00%	927,358	April 2016	759,000
11 Madison Avenue	PGIM Real Estate	60.00%	60.00%	2,314,000	August 2016	2,605,000
333 East 22nd Street	Private Investors	33.33%	33.33%	26,926	August 2016	—
400 East 57th Street⁽⁸⁾	BlackRock, Inc and Stonehenge Partners	51.00%	41.00%	290,482	October 2016	170,000
One Vanderbilt	National Pension Service of Korea/Hines Interest LP	71.01%	71.01%	—	January 2017	3,310,000
Worldwide Plaza	RXR Realty / New York REIT / Private Investor	24.35%	24.35%	2,048,725	October 2017	1,725,000
1515 Broadway	Allianz Real Estate of America	56.87%	56.87%	1,750,000	November 2017	1,950,000
2 Herald Square	Israeli Institutional Investor	51.00%	51.00%	369,000	November 2018	266,000


(1)	Ownership interest and economic interest represent the Company's interests in the joint venture as of June 30, 2019. Changes in ownership or economic interests within the current year are disclosed in the notes below.


(2)	Acquisition Date and Gross Asset Valuation represent the date on which the Company initially acquired an interest in the joint venture and the actual or implied gross asset value of the property or properties on that date. Acquisition Date and Gross Asset Valuation are not adjusted for subsequent acquisitions or dispositions of interest.

(3)

In January 2018, the partnership agreement for our investment was modified resulting in the Company no longer having a controlling interest in this investment. As a result the investment was deconsolidated as of January 1, 2018. We recorded our non-controlling interest at fair value resulting in a $49.3 million fair value adjustment in the consolidated statement of operations. This fair value was allocated to the assets and liabilities, including identified intangibles, of the joint venture.


(4)	The acquisition 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)	In February 2019, we, together with our joint venture partner, closed on the sale of one property from the Stonehenge Portfolio. In May 2019, we closed on the sale of our interest in another property from the Stonehenge Portfolio. These sales are further described under Sale of Joint Venture Interest of Properties below.

(8)

In October 2016, we sold a 49% interest in this property to an investment account managed by BlackRock, Inc. Our interest in the property was sold within a consolidated joint venture owned 90% by the Company and 10% by Stonehenge. The transaction resulted in the deconsolidation of the venture's remaining 51% interest in the property. Our joint venture with Stonehenge remains consolidated resulting in the combined 51% interest being shown within investments in unconsolidated joint ventures on our balance sheet.

As of June 30, 2019 and December 31, 2018, the carrying value for acquisition, development and construction arrangements were as follows (dollars in thousands):



Loan Type	June 30, 2019		December 31, 2018		Maturity Date
Mezzanine Loan	—		44,357		February 2022
	$	—	$	44,357

Schedule of first mortgage notes payable collateralized by the respective joint venture properties and assignment of leases

The first mortgage notes and other loans payable collateralized by the respective joint venture properties and assignment of leases at June 30, 2019 and December 31, 2018, respectively, are as follows (dollars in thousands):



Property	Economic Interest ⁽¹⁾		Maturity Date	Interest Rate ⁽²⁾			June 30, 2019		December 31, 2018
Fixed Rate Debt:
717 Fifth Avenue (mortgage)	10.92	%	July 2022		4.45	%	$	300,000	$	300,000
717 Fifth Avenue (mezzanine)	10.92	%	July 2022		5.50	%	355,328		355,328
650 Fifth Avenue (mortgage)	50.00	%	October 2022		4.46	%	210,000		210,000
650 Fifth Avenue (mezzanine)	50.00	%	October 2022		5.45	%	65,000		65,000
21 East 66th Street	32.28	%	April 2023		3.60	%	12,000		12,000
919 Third Avenue	51.00	%	June 2023		5.12	%	500,000		500,000
1515 Broadway	56.87	%	March 2025		3.93	%	847,250		855,876
11 Madison Avenue	60.00	%	September 2025		3.84	%	1,400,000		1,400,000
800 Third Avenue	60.52	%	February 2026		3.37	%	177,000		177,000
400 East 57th Street	41.00	%	November 2026		3.00	%	98,790		99,828
Worldwide Plaza	24.35	%	November 2027		3.98	%	1,200,000		1,200,000
Stonehenge Portfolio ⁽³⁾	Various		Various		3.50	%	196,112		321,076
521 Fifth Avenue⁽⁴⁾							—		170,000
Total fixed rate debt							$	5,361,480	$	5,666,108



Property	Economic Interest ⁽¹⁾		Maturity Date	Interest Rate ⁽²⁾			June 30, 2019			December 31, 2018
Floating Rate Debt:
280 Park Avenue	50.00	%	September 2019	L+	1.73	%	$	1,200,000		$	1,200,000
121 Greene Street	50.00	%	November 2019	L+	1.50	%	15,000			15,000
10 East 53rd Street	55.00	%	February 2020	L+	2.25	%	170,000			170,000
1552 Broadway	50.00	%	October 2020	L+	2.65	%	195,000			195,000
55 West 46th Street ⁽⁵⁾	25.00	%	November 2020	L+	2.13	%	190,718			185,569
11 West 34th Street	30.00	%	January 2021	L+	1.45	%	23,000			23,000
100 Park Avenue	49.90	%	February 2021	L+	1.75	%	358,809			360,000
One Vanderbilt ⁽⁶⁾	71.01	%	September 2021	L+	2.75	%	478,708			375,000
2 Herald Square	51.00	%	November 2021	L+	1.55	%	150,000			133,565
605 West 42nd Street	20.00	%	August 2027	L+	1.44	%	550,000			550,000
21 East 66th Street	32.28	%	June 2033	1 Year Treasury+	2.75	%	1,534			1,571
131-137 Spring Street⁽⁷⁾							—			141,000
103 East 86th Street⁽⁸⁾							—			38,000
Total floating rate debt							$	3,332,769		$	3,387,705
Total joint venture mortgages and other loans payable							$	8,694,249		$	9,053,813
Deferred financing costs, net							(102,858		)	(103,191		)
Total joint venture mortgages and other loans payable, net							$	8,591,391		$	8,950,622


(1)	Economic interest represents the Company's interests in the joint venture as of June 30, 2019. Changes in ownership or economic interests, if any, within the current year are disclosed in the notes to the investment in unconsolidated joint ventures table above.


(2)	Interest rates as of June 30, 2019, taking into account interest rate hedges in effect during the period. Floating rate debt is presented with the stated interest rate spread over 30-day LIBOR, unless otherwise specified.


(3)	Amount is comprised of $132.6 million and $63.5 million in fixed-rate mortgages that mature in April 2028 and July 2029, respectively.


(4)	In May 2019, we, along with our joint venture partner, closed on the sale of the property.


(5)	This loan has a committed amount of $195.0 million, of which $4.3 million was unfunded as of June 30, 2019.


(6)	This loan is a $1.75 billion construction facility with reductions in interest cost based on meeting certain conditions and has an initial five-year term with two one-year extension options. Advances under the loan are subject to incurred costs, funded equity, loan to value thresholds, and entering into construction contracts.


(7)	In January 2019, we closed on the sale of our interest in the property.

(8)

In February 2019, we, along with our joint venture partner, closed on the sale of the property.

Schedule of combined balance sheets for the unconsolidated joint ventures

The combined balance sheets for the unconsolidated joint ventures, at June 30, 2019 and December 31, 2018 are as follows (in thousands):



	June 30, 2019		December 31, 2018
Assets ⁽¹⁾
Commercial real estate property, net	$	14,151,061	$	14,347,673
Cash and restricted cash	319,429		381,301
Tenant and other receivables, related party receivables, and deferred rents receivable	321,603		273,141
Debt and preferred equity investments, net	—		44,357
Other assets	2,093,491		2,187,166
Total assets	$	16,885,584	$	17,233,638
Liabilities and equity ⁽¹⁾
Mortgages and other loans payable, net	$	8,591,391	$	8,950,622
Deferred revenue/gain	1,558,660		1,660,838
Lease liabilities	900,601		637,168
Other liabilities	290,007		309,145
Equity	5,544,925		5,675,865
Total liabilities and equity	$	16,885,584	$	17,233,638
Company's investments in unconsolidated joint ventures	$	2,937,153	$	3,019,020

(1)

The combined assets, liabilities and equity for the unconsolidated joint ventures reflects the effect of step ups in basis on the retained non-controlling interests in deconsolidated investments as a result of the adoption of ASC 610-20 in January 2018.

Schedule of combined statements of income for the unconsolidated joint ventures

The combined statements of operations for the unconsolidated joint ventures, from acquisition date through the three and six months ended June 30, 2019 and 2018, are as follows (in thousands):



	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
Total revenues	$	290,448		$	314,195		$	597,967		$	635,136
Operating expenses	48,514			50,356			102,638			110,129
Operating lease rent	6,234			4,457			12,135			8,850
Real estate taxes	51,987			55,838			106,223			112,865
Interest expense, net of interest income	93,693			91,648			190,316			181,389
Amortization of deferred financing costs	4,782			7,350			9,998			12,466
Depreciation and amortization	103,681			111,495			208,012			216,575
Total expenses	308,891			321,144			629,322			642,274
Net loss before gain on sale ⁽¹⁾	$	(18,443	)	$	(6,949	)	$	(31,355	)	$	(7,138	)
Company's equity in net (loss) income from unconsolidated joint ventures ⁽¹⁾	$	(7,546	)	$	4,702		$	(12,780	)	$	8,738

(1)

The combined statements of operations and the Company's equity in net (loss) income for the unconsolidated joint ventures reflects the effect of step ups in basis on the retained non-controlling interests in deconsolidated investments as a result of the adoption of ASC 610-20 in January 2018.

Discontinued Operations, Disposed of by Sale

Schedule of Equity Method Investments [Line Items]

Schedule of general information on joint ventures

The following table summarizes the investments in unconsolidated joint ventures sold during the six months ended June 30, 2019:



Property	Ownership Interest	Disposition Date	Gross Asset Valuation (in thousands)⁽¹⁾		Gain (Loss) on Sale (in thousands)⁽²⁾
131-137 Spring Street	20.00%	January 2019	$	216,000	$	17,660
521 Fifth Avenue	50.50%	May 2019	381,000		57,874
Stonehenge Portfolio (partial)	Various	Various	468,800		(2,408		)


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

(2)

Represents the Company's share of the gain (loss). Gain (loss) amounts do not include adjustments for expenses recorded in subsequent periods.