8-K

UNITED STATES

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): February 21, 2018

EMPIRE STATE REALTY TRUST, INC.

(Exact Name of Registrant as Specified in its Charter)

Maryland	001-36105	37-1645259
(State or other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

EMPIRE STATE REALTY OP, L.P.

(Exact Name of Registrant as Specified in its Charter)

Delaware	001-36106	45-4685158
(State or other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

111 West 33rd Street, 12th Floor New York, New York	10120
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (212) 687-8700

n/a

(Former name or former address, if changed from last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02. Results of Operations and Financial Condition.

On February 21, 2018, Empire State Realty Trust, Inc. (the “Company” or “we”) issued a press release announcing its financial results for the fourth quarter 2017. The press release referred to certain supplemental information that is available on the Company’s website. The press release and the supplemental information are attached hereto as Exhibits 99.1 and 99.2, respectively, and are incorporated by reference herein.

The information in Item 2.02 of this Current Report, including Exhibits 99.1 and 99.2, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section. Such information shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, unless it is specifically incorporated by reference therein.

Item 7.01. Regulation FD Disclosure

As discussed in Item 2.02 above, the Company issued a press release regarding its financial results for the fourth quarter 2017 and made available on its website certain supplemental information relating thereto.

The information in Item 7.01 of this Current Report is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that Section. Such information shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act or the Exchange Act, unless it is specifically incorporated by reference therein.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description
99.1	Press Release announcing financial results for the fourth quarter 2017
99.2	Supplemental report

Non-GAAP Supplemental Financial Measures

Funds From Operations (“FFO”)

We compute FFO in accordance with the “White Paper” on FFO published by the National Association of Real Estate Investment Trusts, or NAREIT, which defines FFO as net income (loss) (determined in accordance with GAAP), excluding impairment writedowns of investments in depreciable real estate and investments in in-substance real estate investments, gains or losses from debt restructurings and sales of depreciable operating properties, plus real estate-related depreciation and amortization (excluding amortization of

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deferred financing costs), less distributions to non-controlling interests and gains/losses from discontinued operations and after adjustments for unconsolidated partnerships and joint ventures. FFO is a widely recognized non-GAAP financial measure for REITs that we believe, when considered with financial statements determined in accordance with GAAP, is useful to investors in understanding financial performance and providing a relevant basis for comparison among REITs. In addition, FFO is useful to investors as it captures features particular to real estate performance by recognizing that real estate has generally appreciated over time or maintains residual value to a much greater extent than do other depreciable assets. Investors should review FFO, along with GAAP net income, when trying to understand an equity REIT’s operating performance. We present FFO because we consider it an important supplemental measure of our operating performance and believe that it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs. However, because FFO excludes depreciation and amortization and captures neither the changes in the value of our properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effect and could materially impact our results of operations, the utility of FFO as a measure of performance is limited. There can be no assurance that FFO presented by us is comparable to similarly titled measures of other REITs. FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions. Although FFO is a measure used for comparability in assessing the performance of REITs, as the NAREIT White Paper only provides guidelines for computing FFO, the computation of FFO may vary from one company to another.

Modified Funds From Operations (“Modified FFO”)

Modified FFO adds back an adjustment for any above or below-market ground lease amortization to traditionally defined FFO. We consider this a useful supplemental measure in evaluating our operating performance due to the non-cash accounting treatment under GAAP, which stems from the third quarter 2014 acquisition of two option properties following our formation transactions as they carry significantly below market ground leases, the amortization of which is material to our overall results. We present Modified FFO because we consider it an important supplemental measure of our operating performance in that it adds back the non-cash amortization of below-market ground leases. There can be no assurance that Modified FFO presented by us is comparable to similarly titled measures of other REITs. Modified FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. Modified FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions.

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Core Funds From Operations (“Core FFO”)

Core FFO adds back to Modified FFO the following items: acquisition expenses, deferred tax asset write-off, loss on early extinguishment of debt and acquisition break-up fee. The Company presents Core FFO because it considers it an important supplemental measure of its operating performance in that it excludes non-recurring items. There can be no assurance that Core FFO presented by the Company is comparable to similarly titled measures of other REITs. Core FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. Core FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions. In future periods, we may also exclude other items from Core FFO that we believe may help investors compare our results.

Core Funds Available for Distribution (“Core FAD”)

In addition to Core FFO, we present Core FAD by (i) adding to Core FFO non-real estate depreciation and amortization, the amortization of deferred financing costs, amortization of debt discounts and non-cash compensation expense and (ii) deducting straight line rent, recurring second generation leasing commissions, tenant improvements, prebuilts, capital expenditures, furniture, fixtures & equipment purchases, amortization of debt premiums and above/below market rent revenue. Core FAD is presented solely as a supplemental disclosure that management believes provides useful information regarding our ability to fund our dividends. Core FAD does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. Core FAD is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions. There can be no assurance that Core FAD presented by us is comparable to similarly titled measures of other REITs.

Net Operating Income (“NOI”)

NOI is a non-GAAP financial measure of performance. NOI is used by our management to evaluate and compare the performance of our properties and to determine trends in earnings and to compute the fair value of our properties as it is not affected by: (i) the cost of funds of the property owner, (ii) the impact of depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets that are included in net income computed in accordance with GAAP, (iii) acquisition expenses and break-up fee, or (iv) general and administrative expenses and other gains and losses that are specific to the property owner. The cost of funds is eliminated from NOI because it is specific to the particular financing capabilities and constraints of the owner. The cost of funds is eliminated because it is dependent on historical interest rates and other costs of capital as well as past decisions made by us regarding the appropriate mix of capital which may have changed or may change in the future. Depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets are eliminated because they may not accurately represent the actual change in value in our

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office or retail properties that result from use of the properties or changes in market conditions. While certain aspects of real property do decline in value over time in a manner that is reasonably captured by depreciation and amortization, the value of the properties as a whole have historically increased or decreased as a result of changes in overall economic conditions instead of from actual use of the property or the passage of time. Gains and losses from the sale of real property vary from property to property and are affected by market conditions at the time of sale which will usually change from period to period. These gains and losses can create distortions when comparing one period to another or when comparing our operating results to the operating results of other real estate companies that have not made similarly-timed purchases or sales. We believe that eliminating these costs from net income is useful because the resulting measure captures the actual revenue, generated and actual expenses incurred in operating our properties as well as trends in occupancy rates, rental rates and operating costs. However, the usefulness of NOI is limited because it excludes general and administrative costs, interest expense, depreciation and amortization expense and gains or losses from the sale of properties, and other gains and losses as stipulated by GAAP, the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, all of which are significant economic costs. NOI may fail to capture significant trends in these components of net income which further limits its usefulness. NOI is a measure of the operating performance of our properties but does not measure our performance as a whole. NOI is therefore not a substitute for net income as computed in accordance with GAAP. This measure should be analyzed in conjunction with net income computed in accordance with. Other companies may use different methods for calculating NOI or similarly titled measures and, accordingly, our NOI may not be comparable to similarly titled measures reported by other companies that do not define the measure exactly as we do.

EBITDA

We compute EBITDA as net income plus interest expense, income taxes and depreciation and amortization. We present EBITDA because we believe that EBITDA, along with cash flow from operating activities, investing activities and financing activities, provides investors with an additional indicator of its ability to incur and service debt. EBITDA should not be considered as an alternative to net income (determined in accordance with GAAP), as an indication of our financial performance, as an alternative to net cash flows from operating activities (determined in accordance with GAAP), or as a measure of its liquidity.

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SIGNATURE

Pursuant to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	EMPIRE STATE REALTY TRUST, INC. (Registrant)
Date: February 21, 2018	By:	/s/ David A. Karp
		Name:	David A. Karp
		Title:	Executive Vice President and Chief Financial Officer

Pursuant to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	EMPIRE STATE REALTY OP, L.P. (Registrant)
	By:	Empire State Realty Trust, Inc., as general partner
Date: February 21, 2018	By:	/s/ David A. Karp
		Name:	David A. Karp
		Title:	Executive Vice President and Chief Financial Officer

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EX-99.1

Exhibit 99.1

EMPIRE STATE REALTY TRUST ANNOUNCES FOURTH QUARTER 2017 RESULTS

- Earnings of $0.11 Per Fully Diluted Share -

- Core FFO of $0.25 Per Fully Diluted Share -

- Leased 274,988 Square Feet of Office and Retail Space -

New York, New York, February 21, 2018 - Empire State Realty Trust, Inc. (NYSE: ESRT) (the “Company”), a real estate investment trust with office and retail properties in Manhattan and the greater New York metropolitan area, today reported its operational and financial results for the fourth quarter and full year of 2017.

“Our 2017 Core FFO increased 6.7% from 2016 as we continue to consolidate, redevelop and re-lease space to larger, higher credit quality tenants at higher rents and create long-term value for shareholders. During 2017, we leased almost 1.3 million square feet of office and retail space that resulted in market-leading spreads on both new Manhattan office and total portfolio leases of 41.4% and 30.8%, respectively. Tenants continue to be attracted to our well-located, amenity-rich office buildings, which have all been modernized for the 21^st century. We will continue to build upon this leasing momentum by vacating additional space in 2018 for redevelopment,” stated John B. Kessler, Empire State Realty Trust’s President and Chief Operating Officer.

“For the year, Observatory revenue grew 1.8% and Observatory net operating income grew 2.0% driven by improved revenue mix and active expense management despite reduced attendance,” added Kessler. “We further strengthened our balance sheet with a $450 million private placement of unsecured senior notes and the refinance of our revolving credit facility, term loan and all of our 2017 mortgage maturities. These actions extended our weighted average maturity, lowered borrowing costs and brought new lender relationships. We continue to manage the business with a long-term perspective as we proactively locked in attractive fixed rate capital to fund future growth opportunities and create value for our shareholders.”

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Fourth Quarter Highlights

• Achieved net income attributable to the Company of $0.11 per fully diluted share.

• Core Funds From Operations (“Core FFO”) was $0.25 per fully diluted share.

• Occupancy and leased percentages at December 31, 2017:

• Total portfolio was 89.6% occupied; including signed leases not commenced (“SLNC”), the total portfolio was 92.2% leased.

• Manhattan office portfolio (excluding the retail component of these properties) was 89.0% occupied; including SLNC, the Manhattan office portfolio was 92.1% leased.

• Retail portfolio was 92.0% occupied; including SLNC, the retail portfolio was 93.9% leased.

• Empire State Building was 93.6% occupied; including SLNC, was 94.2% leased.

• Signed 55 leases, representing 274,988 rentable square feet across the total portfolio, and achieved a portfolio-wide 26.8% increase in mark-to-market rent over previous fully escalated rents on new, renewal, and expansion leases.

• Signed 24 new leases representing 170,669 rentable square feet for the Manhattan office portfolio (excluding the retail component of these properties), and achieved an increase of 33.9% in mark-to-market rent over previous fully escalated rents.

• Achieved Empire State Building Observatory revenue for the fourth quarter 2017 of $32.9 million.

• Realized lease termination fee income, included in other revenues and fees, of $3.2 million or approximately $0.01 per fully diluted share.

• Entered into an agreement to issue and sell an aggregate principal amount of $450 million of senior unsecured notes in a private placement, of which $115 million was sold and purchased in December 2017 and $335 million will be sold and purchased in March 2018.

• Declared a dividend in the amount of $0.105 per share.

Full Year Highlights

• Achieved net income attributable to the Company of $0.39 per fully diluted share.

• Core FFO was $0.96 per fully diluted share.

• Signed 167 leases, representing 1,293,700 rentable square feet across the total portfolio, achieving a 30.8% increase in mark-to-market rent over previous fully escalated rents on new, renewal, and expansion leases; 128 of these leases, representing 865,251 rentable square feet, were within the Manhattan office portfolio (excluding the retail component of these properties) achieving a 35.6% increase in mark-to-market rent over previous fully escalated rents on new, renewal and expansion leases.

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• Signed 12 leases, representing 95,360 rentable square feet within the Manhattan retail portfolio, achieving an 82.7% increase in mark-to-market rent over previous fully escalated rents on new, renewal, and expansion leases.

• Signed 78 new leases representing 724,390 rentable square feet in 2017 for the Manhattan office portfolio (excluding the retail component of these properties), achieving an increase of 41.4% in mark-to-market rent over expired previous fully escalated rents.

• Achieved Empire State Building Observatory revenue growth of 1.8% to $127.1 million from $124.8 million in 2016.

• Realized lease termination fee income, included in other revenues and fees, of $13.6 million or approximately $0.045 per fully diluted share, which was partially offset by the write off of associated straight line rent receivables associated with the terminated leases of $1.4 million or approximately $0.005 per fully diluted share.

• Amended and restated the Company’s $1.1 billion undrawn, unsecured revolving credit facility and $265 million term loan, which extended the revolving credit facility maturity, lowered borrowing costs and added flexibility under the financial covenants.

• Refinanced all $336 million of 2017 mortgage maturities with $315 million in new long term fixed rate mortgages with a lower weighted average interest rate.

• Declared and paid aggregate dividends of $0.42 per share during 2017.

Financial Results for the Fourth Quarter 2017

Net income attributable to common stockholders was $17.3 million, or $0.11 per fully diluted share, compared to $17.0 million, or $0.11 per fully diluted share, in the fourth quarter of 2016.

Core FFO was $74.9 million, or $0.25 per fully diluted share, compared to $74.2 million, or $0.25 per fully diluted share, in the fourth quarter of 2016.

Modified FFO was $74.5 million, or $0.25 per fully diluted share, compared to $74.2 million, or $0.25 per fully diluted share, in the fourth quarter of 2016.

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FFO was $72.5 million, or $0.24 per fully diluted share, compared to $72.2 million, or $0.24 per fully diluted share, in the fourth quarter of 2016.

A reconciliation of net income to FFO, Modified FFO and Core FFO is provided in the tables accompanying this press release.

Financial Results for the Year Ended December 31, 2017

Net income attributable to common stockholders was $62.6 million, or $0.39 per fully diluted share, compared to $51.5 million, or $0.38 per fully diluted share, for the year ended December 31, 2016.

Core FFO was $286.9 million, or $0.96 per fully diluted share, compared to $269.0 million, or $0.97 per fully diluted share, for the year ended December 31, 2016.

Modified FFO was $284.3 million, or $0.95 per fully diluted share, compared to $268.4 million, or $0.97 per fully diluted share, for the year ended December 31, 2016.

FFO was $276.5 million, or $0.93 per fully diluted share, compared to $260.5 million, or $0.94 per fully diluted share, for the year ended December 31, 2016.

Portfolio Operations

As of December 31, 2017, the Company’s total portfolio contained 10.1 million rentable square feet of office and retail space. The Company’s occupancy levels fluctuate in certain periods due to the timing lag that exists between the date of tenants’ move out and the date of Company’s completion of redevelopment work for new leases to commence. As of December 31, 2017, the Company’s portfolio was occupied and leased as follows. Leased percentages include signed leases not commenced.

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	December 31, 2017		September 30, 2017		December 31, 2016
Percent occupied:
Total portfolio		89.6%		89.8%		88.1%
Total office		89.5%		89.5%		88.0%
Manhattan office		89.0%		89.1%		86.8%
Empire State Building		93.6%		93.3%		90.5%
Retail		92.0%		94.1%		88.6%
Percent leased:
Total portfolio		92.2%		91.7%		90.2%
Total office		92.1%		91.5%		90.2%
Manhattan office		92.1%		91.5%		89.1%
Empire State Building		94.2%		93.5%		91.8%
Retail		93.9%		94.1%		89.6%

Leasing

For the three months ended December 31, 2017, the Company signed 55 new, renewal, and expansion leases within the total portfolio, comprising 274,988 rentable square feet with an average starting rental rate of $61.42 per rentable square foot, representing an increase of 26.8% over the previous fully escalated rent.

On a blended basis, the 38 new, renewal, and expansion office leases, comprising 213,906 rentable square feet, signed within the Manhattan office portfolio during the fourth quarter had an average starting rental rate of $59.77 per rentable square foot, representing an increase of 29.4% over the previous fully escalated rent.

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Leases Signed in the Fourth Quarter 2017 for the Manhattan Office Portfolio

• 24 new leases, comprising 170,669 rentable square feet, with an average starting rental rate of $61.31 per rentable square foot, representing an increase of 33.9% over the previous fully escalated rent, and

• 14 renewal leases, comprising 43,237 rentable square feet, with an average starting rental rate of $53.72 per rentable square foot, representing an increase of 12.7% over the previous fully escalated rent.

Significant Leases Executed During the Fourth Quarter 2017

• At 250 West 57^th Street, the Company signed a new full floor office lease, totaling 26,150 rentable square feet, with Universal Music Group for a term of 11 years.

• At One Grand Central Place, the Company signed a new full floor office lease, totaling 12,700 rentable square feet, with Hoguet Newman Regal and Kenney, LLP, for a term of 10.4 years.

• At 111 West 33^rd Street, the Company signed a new full floor office lease, totaling 10,500 rentable square feet, with MSG Ventures for a term of 7.4 years.

Empire State Building

The Company continues to renovate and lease the 2.8 million rentable square foot Empire State Building, its flagship property. As previously announced in the second quarter 2017, the Company commenced the first phase of a capital project to enhance the experience of office and retail tenants and Observatory visitors. The first phase is underway, and will move the Observatory entrance to a new, larger, designated entrance at the western side of the Empire State Building on 34^th Street, which will improve the commercial tenant and office visitor experience and the value of the Empire State Building’s 34^th Street retail.

During the fourth quarter 2017, the Company signed seven office leases at the Empire State Building, representing 50,673 rentable square feet in the aggregate.

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Observatory revenue for the fourth quarter 2017 was $32.9 million, a 2.4% decrease from $33.7 million in the fourth quarter 2016. The Observatory hosted approximately 1,014,000 visitors in the fourth quarter 2017 compared to 1,068,000 visitors in the fourth quarter 2016, a decrease of 5.1%. In the fourth quarter 2017, there were 10 bad weather days compared to 14 bad weather days in the fourth quarter 2016. For the fourth quarter, the Company estimates that bad weather resulted in approximately two thousand net fewer visitors than in the prior year period.

Observatory revenue was $127.1 million for the year ended December 31, 2017, a 1.8% increase from $124.8 million for the year ended December 31, 2016. For the year ended December 31, 2017, the Observatory hosted approximately 4,053,000 visitors, compared to 4,250,000 visitors for the same period in 2016, a decrease of 4.6%. For the year ended December 31, 2017, there were 61 bad weather days compared to 45 bad weather days in the year ended December 31, 2016.

Balance Sheet

At December 31, 2017, there was no outstanding balance on the Company’s $1.1 billion unsecured revolving credit facility and $265 million outstanding under the term loan facility. The facilities have an accordion feature allowing for an additional increase in the maximum aggregate principal balance to $1.75 billion under certain circumstances.

As of December 31, 2017, the Company had total debt outstanding of approximately $1.7 billion, with a weighted average interest rate of 4.05% per annum, and a weighted average term to maturity of 6.2 years. None of the Company’s outstanding debt is subject to variable interest rates. The Company’s consolidated net debt to total market capitalization was approximately 16.6% and consolidated net debt to EBITDA was 3.5x. The Company had cash and cash equivalents of $464.3 million.

In December 2017, the Company entered into an agreement to issue and sell an aggregate principal amount of $450 million of its senior unsecured notes in a private placement. The notes consist of $115 million of 4.08% Series D Senior Notes due 2028, $160 million of 4.26% Series E Senior Notes due 2030, and $175 million of 4.44% Series F Senior Notes due 2033. The notes will be issued and sold on two

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funding dates. The sale and purchase of the Series D Senior Notes occurred on December 22, 2017. The sale and purchase of the Series E and Series F Senior Notes will occur at a closing on March 22, 2018, subject to customary closing conditions. In connection with the March 2018 issuance of the notes, the Company intends to repay its mortgage indebtedness on 111 West 33^rd Street and 1350 Broadway, before their maturity dates in early April 2018.

Subsequent Events

In January 2018, the Company refinanced and increased its mortgage debt on 1333 Broadway from $66.6 million to $160.0 million, due February 2033 with interest fixed at 4.21%. A portion of this increase was applied to release the $75.8 million mortgage lien on 1400 Broadway.

Dividend

On December 31, 2017, the Company paid a dividend of $0.105 per share for the fourth quarter 2017 to holders of the Company’s Class A common stock and Class B common stock and to holders of the operating partnership’s Series ES, Series 250 and Series 60 operating partnership units (NYSE Arca: ESBA, FISK and OGCP, respectively) and Series PR operating partnership units. The Company paid a dividend of $0.15 per unit for the fourth quarter 2017 to holders of the operating partnership’s private perpetual preferred units.

Webcast and Conference Call Details

Empire State Realty Trust, Inc. will host a webcast and conference call, open to the general public, on Thursday, February 22, 2018 at 8:30 am Eastern time.

The webcast will be accessible in the “Investors” section of the Company’s website at www.empirestaterealtytrust.com. To listen to the live webcast, go to the site at least five minutes prior to the scheduled start time in order to register, download and install any necessary audio software. Shortly after the call, a replay of the webcast will be available for 90 days on the Company’s website.

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The conference call can also be accessed by dialing 1-877-407-3982 for domestic callers or 1-201-493-6780 for international callers. A dial-in replay will be available starting shortly after the call until March 1, 2018, which can be accessed by dialing 1-844-512-2921 for domestic callers or 1-412-317-6671 for international callers. The passcode for this dial-in replay is 13675821.

The Supplemental Report will be available prior to the conference call in the “Investors” section of the Company’s website, www.empirestaterealtytrust.com.

About Empire State Realty Trust

Empire State Realty Trust, Inc. (NYSE: ESRT), a leading real estate investment trust (REIT), owns, manages, operates, acquires and repositions office and retail properties in Manhattan and the greater New York metropolitan area, including the Empire State Building, the world’s most famous building. Headquartered in New York, New York, the Company’s office and retail portfolio covers 10.1 million rentable square feet, as of December 31, 2017, consisting of 9.4 million rentable square feet in 14 office properties, including nine in Manhattan, three in Fairfield County, Connecticut, and two in Westchester County, New York; and approximately 700,000 rentable square feet in the retail portfolio.

Forward-Looking Statements

This press release includes “forward looking statements” within the meaning of the federal securities laws. Forward-looking statements may be identified by the use of words such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “pro forma,” “estimates,” “contemplates,” “aims,” “continues,” “would” or “anticipates” or the negative of these words and phrases or similar words or phrases. The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: changes in our industry, the real estate markets, either nationally or in Manhattan or the greater New York metropolitan area; resolution of legal proceedings involving the company; reduced demand for office or retail space; general volatility of the capital and credit markets and the market price of our Class A common stock and our

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publicly-traded operating partnership units; changes in our business strategy; changes in technology and market competition which affect utilization of our broadcast or other facilities; changes in domestic or international tourism, including geopolitical events and currency exchange rates; defaults on, early terminations of, or non-renewal of, leases by tenants; fluctuations in interest rates; declining real estate valuations and impairment charges; termination or expiration of our ground leases; our failure to obtain or maintain necessary outside financing, including our unsecured revolving credit facility; our leverage; decreased rental rates or increased vacancy rates; our failure to redevelop and reposition properties, or to execute any newly planned capital project, successfully or on the anticipated timeline or at the anticipated costs; difficulties in identifying properties to acquire and completing acquisitions; risks of real estate development (including our Metro Tower development site) and capital projects, including the cost of construction delays and cost overruns; impact of changes in governmental regulations, tax law and rates and similar matters; and our failure to qualify as a real estate investment trust, or REIT. For a further discussion of these and other factors that could impact the Company’s future results, performance or transactions, see the section entitled “Risk Factors” in the Annual Report on Form 10-K for the year ended December 31, 2016, and other risks described in documents subsequently filed by the Company from time to time with the Securities and Exchange Commission.

While forward-looking statements reflect the Company’s good faith beliefs, they are not guarantees of future performance. The Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events, or other changes after the date of this press release, except as required by applicable law. Prospective investors should not place undue reliance on any forward-looking statements, which are based only on information currently available to the Company (or to third parties making the forward-looking statements).

Contact:

Investors

Empire State Realty Trust Investor Relations

(212) 850-2678

IR@empirestaterealtytrust.com

Media

Sard Verbinnen & Co.

(212) 687-8080

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Empire State Realty Trust, Inc.

Condensed Consolidated Statements of Income

(unaudited and amounts in thousands, except per share data)

	Three Months Ended December 31,
	2017			2016
Revenues
Rental revenue	$	123,596		$	117,498
Tenant expense reimbursement		19,790			17,109
Observatory revenue		32,906			33,702
Third-party management and other fees		312			394
Other revenue and fees		6,466			10,560
Total revenues		183,070			179,263
Operating expenses
Property operating expenses		41,522			38,775
Ground rent expenses		2,332			2,332
General and administrative expenses		13,749			13,455
Observatory expenses		7,196			7,933
Real estate taxes		26,465			24,288
Acquisition expenses		—			—
Depreciation and amortization		40,842			39,829
Total operating expenses		132,106			126,612
Total operating income		50,964			52,651
Other expenses:
Interest expense		(16,364	)		(17,837	)
Loss on early extinguishment of debt		—			—
Loss from derivative financial instruments		—			—
Income before income taxes		34,600			34,814
Income tax expense		(2,340	)		(1,806	)
Net income		32,260			33,008
Preferred unit distributions		(234	)		(234	)
Net income attributable to non-controlling interests		(14,754	)		(15,808	)
Net income attributable to common stockholders	$	17,272		$	16,966
Total weighted average shares
Basic		159,989			153,273
Diluted		297,898			297,046
Net income per share attributable to common stockholders
Basic	$	0.11		$	0.11
Diluted	$	0.11		$	0.11

11

Empire State Realty Trust, Inc.

Condensed Consolidated Statements of Income

(unaudited and amounts in thousands, except per share data)

	Year Ended December 31,
	2017			2016
Revenues
Rental revenue	$	483,944		$	460,653
Tenant expense reimbursement		73,679			73,459
Observatory revenue		127,118			124,814
Third-party management and other fees		1,400			1,766
Other revenue and fees		26,327			17,308
Total revenues		712,468			678,000
Operating expenses
Property operating expenses		163,531			153,850
Ground rent expenses		9,326			9,326
General and administrative expenses		50,315			49,078
Observatory expenses		30,275			29,833
Real estate taxes		102,466			96,061
Acquisition expenses		—			98
Depreciation and amortization		160,710			155,211
Total operating expenses		516,623			493,457
Total operating income		195,845			184,543
Other expenses:
Interest expense		(68,473	)		(70,595	)
Loss on early extinguishment of debt		(2,157	)		(552	)
Loss from derivative financial instruments		(289	)		—
Income before income taxes		124,926			113,396
Income tax expense		(6,673	)		(6,146	)
Net income		118,253			107,250
Preferred unit distributions		(936	)		(936	)
Net income attributable to non-controlling interests		(54,670	)		(54,858	)
Net income attributable to common stockholders	$	62,647		$	51,456
Total weighted average shares
Basic		158,380			133,881
Diluted		298,049			277,568
Net income per share attributable to common stockholders
Basic	$	0.40		$	0.38
Diluted	$	0.39		$	0.38

12

Empire State Realty Trust, Inc.

Reconciliation of Net Income to Funds From Operations (“FFO”),

Modified Funds From Operations (“Modified FFO”) and Core Funds From Operations (“Core FFO”)

(unaudited and amounts in thousands, except per share data)

	Three Months Ended December 31,
	2017			2016
Net income	$	32,260		$	33,008
Preferred unit distributions		(234	)		(234	)
Real estate depreciation and amortization		40,484			39,426
FFO attributable to common stockholders and non-controlling interests		72,510			72,200
Amortization of below-market ground leases		1,958			1,958
Modified FFO attributable to common stockholders and non-controlling interests		74,468			74,158
Deferred tax asset write-off		446			—
Loss on early extinguishment of debt		—			—
Acquisition expenses		—			—
Core FFO attributable to common stockholders and non-controlling interests	$	74,914		$	74,158
Total weighted average shares
Basic		296,654			296,084
Diluted		297,898			297,046
FFO per share
Basic	$	0.24		$	0.24
Diluted	$	0.24		$	0.24
Modified FFO per share
Basic	$	0.25		$	0.25
Diluted	$	0.25		$	0.25
Core FFO per share
Basic	$	0.25		$	0.25
Diluted	$	0.25		$	0.25

13

Empire State Realty Trust, Inc.

Reconciliation of Net Income to Funds From Operations (“FFO”),

Modified Funds From Operations (“Modified FFO”) and Core Funds From Operations (“Core FFO”)

(unaudited and amounts in thousands, except per share data)

	Year Ended December 31,
	2017			2016
Net income	$	118,253		$	107,250
Preferred unit distributions		(936	)		(936	)
Real estate depreciation and amortization		159,174			154,205
FFO attributable to common stockholders and non-controlling interests		276,491			260,519
Amortization of below-market ground leases		7,831			7,831
Modified FFO attributable to common stockholders and non-controlling interests		284,322			268,350
Deferred tax asset write-off		446			—
Loss on early extinguishment of debt		2,157			552
Acquisition expenses		—			98
Core FFO attributable to common stockholders and non-controlling interests	$	286,925		$	269,000
Total weighted average shares
Basic		296,455			276,848
Diluted		298,049			277,568
FFO per share
Basic	$	0.93		$	0.94
Diluted	$	0.93		$	0.94
Modified FFO per share
Basic	$	0.96		$	0.97
Diluted	$	0.95		$	0.97
Core FFO per share
Basic	$	0.97		$	0.97
Diluted	$	0.96		$	0.97

14

Empire State Realty Trust, Inc.

Condensed Consolidated Balance Sheets

(unaudited and amounts in thousands)

	December 31,			December 31,
	2017			2016
Assets
Commercial real estate properties, at cost	$	2,667,655		$	2,458,629
Less: accumulated depreciation		(656,900	)		(556,546	)
Commercial real estate properties, net		2,010,755			1,902,083
Cash and cash equivalents		464,344			554,371
Restricted cash		65,853			61,514
Tenant and other receivables		28,329			22,542
Deferred rent receivables		178,629			152,074
Prepaid expenses and other assets		61,028			53,749
Deferred costs, net		262,701			277,081
Acquired below market ground leases, net		368,229			376,060
Goodwill		491,479			491,479
Total assets	$	3,931,347		$	3,890,953
Liabilities and equity
Mortgage notes payable, net	$	717,164		$	759,016
Senior unsecured notes, net		707,895			590,388
Unsecured term loan facility, net		263,662			262,927
Unsecured revolving credit facility		—			—
Accounts payable and accrued expenses		110,849			134,064
Acquired below market leases, net		66,047			82,300
Deferred revenue and other liabilities		40,907			32,212
Tenants’ security deposits		47,086			47,183
Total liabilities		1,953,610			1,908,090
Total equity		1,977,737			1,982,863
Total liabilities and equity	$	3,931,347		$	3,890,953

15

EX-99.2

Exhibit 99.2

Fourth Quarter 2017

Table of Contents	Page
Summary
Company Profile		3
Financial Highlights		4
Selected Property Data
Property Summary Net Operating Income		5
Net Operating Income and Initial Free Rent Burn-Off		6
Leasing Activity		7
Property Detail		9
Tenant Lease Expirations		10
Largest Tenants and Portfolio Tenant Diversification by Industry		13
Capital Expenditures and Redevelopment Program		14
Observatory Summary		15
Financial information
Condensed Consolidated Balance Sheets		16
Condensed Consolidated Statements of Income		17
Core FFO, Modified FFO, FFO, FAD and EBITDA		18
Consolidated Debt Analysis
Debt Summary		19
Debt Detail		20
Debt Maturities		21
Ground Leases		21
Supplemental Definitions		22

Forward-looking Statements

We make forward-looking statements in this supplemental package within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. You should not rely on them as predictions of future events. For these statements, we claim the protections of the safe harbor for forward-looking statements contained in such Sections.

You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “estimates,” “contemplates,” “aims,” “continues,” “would” or “anticipates” or similar words or phrases in the positive or negative. In particular, forward looking statements include those pertaining to our capital resources, portfolio performance, dividend policy, results of operations, anticipated growth in our portfolio from operations, acquisitions, and market conditions and demographics.

Forward-looking statements involve numerous risks and uncertainties, many of which are difficult to predict and generally beyond our control. They depend on assumptions, data or methods which may be incorrect or imprecise, and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all).

The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: changes in our industry and markets, either nationally or in Manhattan or the greater New York metropolitan area; resolution of the litigations and arbitration involving our company; reduced demand for office or retail space; general volatility of the capital and credit markets and the market price of our Class A common stock and listed operating partnership units; changes in our business strategy; defaults on, early terminations of, or non-renewal of, leases by tenants; bankruptcy or insolvency of a major tenant or a significant number of smaller tenants; litigation; fluctuations in interest rates; increased operating costs; declining real estate valuations and impairment charges; availability, terms and deployment of capital; our failure to obtain necessary outside financing; our expected leverage; decreased rental rates or increased vacancy rates; breach of or the expiration of our ground lease; our failure to generate sufficient cash flows to service our outstanding indebtedness; our failure to redevelop, renovate and reposition properties successfully or on the anticipated timeline or at the anticipated costs; difficulties in identifying properties to acquire and completing acquisitions; risks of real estate acquisitions, dispositions and development (including our Metro Tower development site), including construction delays and cost overruns; our failure to operate acquired properties and operations successfully; our ability to manage our growth effectively; changes in governmental regulations, tax laws and rates and similar matters; estimates relating to our ability to make distributions to our securityholders in the future; our failure to qualify as a REIT; a future terrorist event in the U.S.; environmental uncertainties and risks related to adverse weather conditions and natural disasters; lack or insufficient amounts of insurance; financial market fluctuations; availability of, and our ability to attract and retain, qualified personnel; conflicts of interest affecting our senior management team; competition; changes in real estate and zoning laws and increases in real property tax rates; and our ability to comply with the laws, rules and regulations applicable to companies and, in particular, public companies. While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. We disclaim any obligation to update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, or new information, data or methods, future events or other changes after the date of this presentation, except as required by applicable law. For a further discussion of these and other factors that could impact our future results, performance or transactions, see the section entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2016 and other risks described in documents we subsequently file from time to time with the Securities and Exchange Commission.

Page 2

Fourth Quarter 2017

COMPANY PROFILE

Empire State Realty Trust, Inc., or the Company, is a leading real estate investment trust (REIT) that owns, manages, operates, acquires and repositions office and retail properties in Manhattan and the greater New York metropolitan area, including the Empire State Building, the world’s most famous building.

BOARD OF DIRECTORS

Anthony E. Malkin	Chairman and Chief Executive Officer
William H. Berkman	Director, Chair of Finance Committee
Leslie D. Biddle	Director
Thomas J. DeRosa	Director
Steven J. Gilbert	Director, Lead Director
S. Michael Giliberto	Director, Chair of Audit Committee
James D. Robinson IV	Director, Chair of Compensation and Nominating/Corporate Governance Committees

EXECUTIVE MANAGEMENT

Anthony E. Malkin	Chairman and Chief Executive Officer
John B. Kessler	President and Chief Operating Officer
Thomas P. Durels	Executive Vice President and Director of Leasing and Operations
David A. Karp	Executive Vice President and Chief Financial Officer
Thomas N. Keltner, Jr.	Executive Vice President, General Counsel and Secretary

COMPANY INFORMATION

Corporate Headquarters	Investor Relations	New York Stock Exchange
111 West 33rd Street, 12th Floor	Greg Faje	Trading Symbol: ESRT
New York, NY 10120	IR@empirestaterealtytrust.com
www.empirestaterealtytrust.com (212) 687-8700

RESEARCH COVERAGE

Bank of America Merrill Lynch	Jeffrey Spector	(646) 855-1363	jeff.spector@baml.com
	James Feldman	(646) 855-5808	james.feldman@baml.com
BMO Capital Markets Corp.	John Kim	(212) 885-4115	jp.kim@bmo.com
BTIG	Thomas Catherwood	(212) 738-6140	tcatherwood@btig.com
Evercore ISI	Steve Sakwa	(212) 446-9462	steve.sakwa@evercoreisi.com
	Robert Simone	(212) 446-9459	robert.simone@evercoreisi.com
Goldman Sachs & Co. LLC	Andrew Rosivach	(212) 902-4736	rosivach@gs.com
Green Street Advisors	Jed Reagan	(949) 640-8780	jreagan@greenstreetadvisors.com
KeyBanc Capital Markets	Jordan Sadler	(917) 368-2280	jsadler@key.com
	Craig Mailman	(917) 368-2316	cmailman@key.com
Stifel	John Guinee	(443) 224-1307	jwguinee@stifel.com
Wells Fargo Securities, LLC	Blaine Heck	(443) 263-6529	blaine.heck@wellsfargo.com

Page 3

Fourth Quarter 2017

Financial Highlights

(unaudited and dollars in thousands, except per share amounts)

	Three Months Ended
Selected Items:	December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016
Revenue	$	183,070		$	187,320		$	177,124		$	164,954		$	179,263
Net income	$	32,260		$	35,489		$	31,359		$	19,145		$	33,008
Cash net operating income (1)	$	99,671		$	101,314		$	97,270		$	82,781		$	96,338
Core funds from operations (“Core FFO”) (1)	$	74,914		$	77,503		$	73,215		$	61,293		$	74,158
Core funds available for distribution (“Core FAD”) (1)	$	57,467		$	64,201		$	61,546		$	53,721		$	60,472
Core FFO per share—diluted	$	0.25		$	0.26		$	0.25		$	0.21		$	0.25
Diluted weighted average shares		297,898,000			297,871,000			298,398,000			297,962,000			297,046,000
Dividends declared and paid per share	$	0.105		$	0.105		$	0.105		$	0.105		$	0.105
Portfolio Statistics:
Number of properties		20			20			20			20			20
Total rentable square footage		10,144,638			10,137,074			10,139,660			10,145,676			10,138,999
Percent occupied (2)		89.6	%		89.8	%		89.2	%		88.8	%		88.1	%
Percent leased (3)		92.2	%		91.7	%		91.3	%		89.5	%		90.2	%
Observatory Metrics:
Number of visitors		1,014,000			1,276,000			1,126,000			636,000			1,068,000
Change in visitors year over year		(5.1	%)		(4.8	%)		0.2	%		(11.5	%)		12.5	%
Observatory revenues	$	32,906		$	39,306		$	33,966		$	20,940		$	33,702
Change in revenues year over year		(2.4	%)		3.1	%		6.9	%		(1.4	%)		22.1	%
Ratios:
Consolidated Debt to Total Market Capitalization (4)		21.5	%		20.4	%		20.2	%		20.6	%		21.1	%
Consolidated Net Debt to Total Market Capitalization (4)		16.6	%		15.7	%		15.5	%		14.8	%		14.9	%
Consolidated Debt and Perpetual Preferred Units to Total Market Capitalization (4)		21.9	%		20.7	%		20.6	%		20.9	%		21.4	%
Consolidated Net Debt and Perpetual Preferred Units to Total Market Capitalization (4)		17.0	%		16.1	%		15.8	%		15.2	%		15.3	%
Consolidated Debt to EBITDA (5)		4.8	x		4.5	x		4.5	x		4.7	x		4.8	x
Consolidated Net Debt to EBITDA (5)		3.5	x		3.3	x		3.3	x		3.2	x		3.1	x
Interest Coverage Ratio		5.8	x		5.6	x		5.5	x		4.9	x		5.8	x
Core FFO Payout Ratio (6)		42	%		41	%		43	%		51	%		42	%
Core FAD Payout Ratio (7)		55	%		49	%		51	%		58	%		52	%
Class A common stock price at quarter end	$	20.53		$	20.54		$	20.77		$	20.64		$	20.19
Average closing price	$	20.46		$	20.48		$	21.05		$	20.66		$	19.82
Dividends per share—annualized	$	0.42		$	0.42		$	0.42		$	0.42		$	0.42
Dividend yield (8)		2.0	%		2.0	%		2.0	%		2.0	%		2.1	%
Private Perpetual Preferred Units outstanding ($16.62 liquidation value)		1,560,360			1,560,360			1,560,360			1,560,360			1,560,360
Class A common stock		160,424,575			158,349,708			157,493,025			156,689,477			154,744,740
Class B common stock		1,052,469			1,077,740			1,080,475			1,095,114			1,095,737
Operating partnership units		138,932,443			140,989,373			141,844,339			142,583,324			143,252,598
Total common stock and operating partnership units outstanding (9)		300,409,487			300,416,821			300,417,839			300,367,915			299,093,075

Notes:

(1) Represents non-GAAP financial measures. For a discussion on what these metrics represent and why the Company presents them, see page 22 and for a reconciliation of these metrics to net income, see pages 6 and 18.

(2) Based on leases signed and commenced as of end of period.

(3) Represents occupancy and includes signed leases not commenced.

(4) Market capitalization represents the sum of (i) Company’s common stock per share price as of December 31, 2017 multiplied by the total outstanding number of shares of common stock and operating partnership units as of December 31, 2017; (ii) the number of perpetual preferred units at December 31, 2017 multiplied by $16.62 and (iii) our outstanding indebtedness or net indebtedness as of December 31, 2017.

(5) Calculated based on trailing 12 months EBITDA.

(6) Represents the amount of Core FFO paid out in distributions.

(7) Represents the amount of Core FAD paid out in distributions.

(8) Based on the closing price per share of Class A common stock on December 31, 2017.

(9) As of December 31, 2017, the Company has had conversions from operating partnership units and Class B common shares to Class A common shares totaling 36 million shares or approximately $739 million at a closing share price of $20.53. This represents a 44% increase in the number of Class A shares since the IPO.

Page 4

Fourth Quarter 2017

Property Summary - Net Operating Income (“NOI”) by Quarter

(unaudited and dollars in thousands)

	Three Months Ended
	December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016
Total Portfolio
Revenue	$	149,852		$	147,669		$	142,766		$	143,663		$	145,167
Operating expenses		(70,319	)		(70,502	)		(65,403	)		(69,099	)		(65,395	)
Net operating income (“NOI”)		79,533			77,167			77,363			74,564			79,772
Straight-line rent		(5,963	)		(6,861	)		(7,722	)		(5,998	)		(8,652	)
Above/below-market rent revenue amortization		(1,567	)		(1,607	)		(1,119	)		(1,428	)		(2,509	)
Below-market ground lease amortization		1,958			1,957			1,958			1,958			1,958
Total cash NOI - excluding Observatory		73,961			70,656			70,480			69,096			70,569
Observatory cash NOI		25,710			30,658			26,790			13,685			25,769
Total cash NOI - including Observatory	$	99,671		$	101,314		$	97,270		$	82,781		$	96,338
Manhattan Office Portfolio (1)
Revenue	$	125,195		$	124,195		$	118,014		$	116,746		$	115,177
Operating expenses		(59,760	)		(60,052	)		(55,230	)		(59,105	)		(55,501	)
NOI		65,435			64,143			62,784			57,641			59,676
Straight-line rent		(5,840	)		(6,825	)		(7,305	)		(6,550	)		(10,296	)
Above/below-market rent revenue amortization		(1,567	)		(1,607	)		(1,119	)		(1,428	)		(2,509	)
Below-market ground lease amortization		1,958			1,957			1,958			1,958			1,958
Cash NOI	$	59,986		$	57,668		$	56,318		$	51,621		$	48,829
Greater New York Office Portfolio
Revenue	$	19,710		$	18,582		$	19,721		$	22,121		$	25,347
Operating expenses		(8,800	)		(8,565	)		(8,425	)		(8,300	)		(8,165	)
NOI		10,910			10,017			11,296			13,821			17,182
Straight-line rent		(272	)		(190	)		(460	)		467			1,301
Above/below-market rent revenue amortization		—			—			—			—			—
Below-market ground lease amortization		—			—			—			—			—
Cash NOI	$	10,638		$	9,827		$	10,836		$	14,288		$	18,483
Standalone Retail Portfolio
Revenue	$	4,947		$	4,892		$	5,031		$	4,796		$	4,643
Operating expenses		(1,759	)		(1,885	)		(1,748	)		(1,694	)		(1,729	)
NOI		3,188			3,007			3,283			3,102			2,914
Straight-line rent		149			154			43			85			343
Above/below-market rent revenue amortization		—			—			—			—			—
Below-market ground lease amortization		—			—			—			—			—
Cash NOI	$	3,337		$	3,161		$	3,326		$	3,187		$	3,257

Note:

⁽¹⁾  Includes 507,395 rentable square feet of retail space in the Company’s nine Manhattan office properties.

Page 5

Fourth Quarter 2017

Net Operating Income (“NOI”) and Initial Free Rent Burn-Off

(unaudited and dollars in thousands)

	Three Months Ended
	December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016
Reconciliation of Net Income to NOI and Cash NOI
Net income	$	32,260		$	35,489		$	31,359		$	19,145		$	33,008
Add:
General and administrative expenses		13,749			12,899			12,579			11,088			13,455
Depreciation and amortization		40,842			38,490			40,532			40,846			39,829
Interest expense		16,364			16,890			17,477			17,742			17,837
Loss on early extinguishment of debt		—			2,157			—			—			—
Loss from derivative financial instruments		—			—			42			247			—
Income tax expense (benefit)		2,340			2,245			2,556			(468	)		1,806
Less:
Third-party management and other fees		(312	)		(345	)		(392	)		(351	)		(394	)
Net operating income		105,243			107,825			104,153			88,249			105,541
Straight-line rent		(5,963	)		(6,861	)		(7,722	)		(5,998	)		(8,652	)
Above/below-market rent revenue amortization		(1,567	)		(1,607	)		(1,119	)		(1,428	)		(2,509	)
Below-market ground lease amortization		1,958			1,957			1,958			1,958			1,958
Total cash NOI - including Observatory		99,671			101,314			97,270			82,781			96,338
Less: Observatory NOI		(25,710	)		(30,658	)		(26,790	)		(13,685	)		(25,769	)
Total cash NOI - excluding Observatory	$	73,961		$	70,656		$	70,480		$	69,096		$	70,569
Cash NOI by Portfolio
Manhattan Office Portfolio	$	59,986		$	57,668		$	56,318		$	51,621		$	48,829
Greater New York Office Portfolio		10,638			9,827			10,836			14,288			18,483
Standalone Retail Portfolio		3,337			3,161			3,326			3,187			3,257
Total cash NOI - excluding Observatory		73,961			70,656			70,480			69,096			70,569
Observatory cash NOI		25,710			30,658			26,790			13,685			25,769
Total cash NOI - including Observatory	$	99,671		$	101,314		$	97,270		$	82,781		$	96,338

Schedule of Initial Free Rent Burn-Off

As of December 31, 2017, the Company had approximately $43 million of annualized cash rents that have yet to contribute to Cash NOI:

	Annualized Initial Base		Cash Base Rent Contributing to the Following Years:
Total Portfolio	Cash Rent		2018		2019		2020		2021
Commenced leases in free rent period	$	26,078	$	12,902	$	25,698	$	26,029	$	26,078
Signed leases not commenced		17,216		840		11,058		16,776		17,216
Total	$	43,294	$	13,742	$	36,756	$	42,805	$	43,294
Signed leases not commenced
Tenant	Square Feet		12/31/17 Escalated Annual Rent		New Annual Rent		Expected Cash Base Rent Commencement Date		Incremental Annual Revenue
Hoguet Newman Regal & Kenney		12,732	$	—	$	850		Dec. 2018	$	850
Renfro Corporation		29,952		—		1,800		Feb. 2019		1,800
Gerson Lehrman Group		13,021		—		720		Mar. 2019		720
BTS USA		11,552		—		790		Mar. 2019		790
UMG Recordings		26,152		—		1,700		Apr. 2019		1,700
ASCAP		85,389		640		5,170		May 2019		4,530
TJX Companies		18,965		460		1,900		July 2019		1,440
Fragoman, Del Rey, Bernsen & Loewy LLP		107,680		3,320		5,920		Mar. 2020		2,600
Other SLNC		46,942		—		2,786		Jan. 2018 - Jun. 2019		2,786
Total		352,385	$	4,420	$	21,636			$	17,216

Page 6

Fourth Quarter 2017

Property Summary—Leasing Activity by Quarter

(unaudited)

	Three Months Ended
	December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016
Total Portfolio
Total leases executed		55			34			51			27			64
Weighted average lease term		8.1 years			12.2 years			9.3 years			10.6 years			7.3 years
Office
Total square footage executed		252,244			487,854			300,269			157,973			199,165
Average rent psf—leases executed	$	56.14		$	52.52		$	55.22		$	50.81		$	47.56
Previously escalated rents psf	$	44.85		$	41.12		$	40.61		$	47.48		$	41.57
Percentage of new rent over previously escalated rents		25.2	%		27.7	%		36.0	%		7.0	%		14.4	%
Retail
Total square footage executed		22,744			—			29,597			43,019			11,615
Average rent psf—leases executed	$	115.33		$	—		$	40.66		$	99.96		$	331.30
Previously escalated rents psf	$	86.38		$	—		$	48.13		$	24.60		$	229.54
Percentage of new rent over previously escalated rents		33.5	%		—			(15.5	%)		306.3	%		44.3	%
Total Portfolio
Total square footage executed		274,988			487,854			329,866			200,992			210,780
Average rent psf—leases executed	$	61.42		$	52.52		$	54.39		$	61.33		$	63.34
Previously escalated rents psf	$	48.45		$	41.12		$	41.52		$	42.58		$	52.02
Percentage of new rent over previously escalated rents		26.8	%		27.7	%		31.0	%		44.0	%		21.8	%
Leasing commission costs per square foot	$	18.06		$	22.15		$	17.74		$	28.01		$	13.89
Tenant improvement costs per square foot		65.95			72.92			68.24			48.84			50.35
Total LC and TI per square foot (2)	$	84.01		$	95.07		$	85.98		$	76.85		$	64.24
Occupancy		89.6	%		89.8	%		89.2	%		88.8	%		88.1	%
Manhattan Office Portfolio (1)
Total leases executed		41			27			43			24			54
Office
Total square footage executed		213,906			315,144			251,041			85,160			120,020
Average rent psf—leases executed	$	59.77		$	58.46		$	59.76		$	59.45		$	56.76
Previously escalated rents psf	$	46.17		$	41.42		$	42.61		$	49.04		$	46.69
Percentage of new rent over previously escalated rents		29.4	%		41.1	%		40.3	%		21.2	%		21.6	%
Retail
Total square footage executed		20,366			—			2,454			43,019			5,479
Average rent psf—leases executed	$	99.98		$	—		$	111.42		$	99.96		$	310.81
Previously escalated rents psf	$	70.61		$	—		$	128.87		$	24.60		$	137.00
Percentage of new rent over previously escalated rents		41.6	%		—			(13.5	%)		306.3	%		126.9	%
Total Manhattan Office Portfolio
Total square footage executed		234,272			315,144			253,495			128,179			125,499
Average rent psf—leases executed	$	63.27		$	58.46		$	60.26		$	73.04		$	67.85
Previously escalated rents psf	$	48.30		$	41.42		$	43.45		$	40.84		$	50.63
Percentage of new rent over previously escalated rents		31.0	%		41.1	%		38.7	%		78.9	%		34.0	%
Leasing commission costs per square foot	$	19.02		$	26.21		$	21.97		$	36.49		$	15.25
Tenant improvement costs per square foot		69.16			80.69			79.19			45.02			45.30
Total LC and TI per square foot (2)	$	88.18		$	106.90		$	101.16		$	81.51		$	60.55
Occupancy		89.0	%		89.2	%		88.7	%		88.1	%		86.7	%

Page 7

Fourth Quarter 2017

Property Summary - Leasing Activity by Quarter - (Continued)

(unaudited)

	Three Months Ended
	December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016
Greater New York Office Portfolio
Total leases executed		11			7			6			3			8
Total square footage executed		38,338			172,710			49,228			72,813			79,145
Average rent psf—leases executed	$	35.89		$	41.68		$	32.02		$	40.71		$	33.61
Previously escalated rents psf	$	37.45		$	40.57		$	30.41		$	45.66		$	33.79
Percentage of new rent over previously escalated rents		(4.2	%)		2.7	%		5.3	%		(10.8	%)		(0.6	%)
Leasing commission costs per square foot	$	10.35		$	14.74		$	5.71		$	13.08		$	11.76
Tenant improvement costs per square foot		50.40			58.76			49.50			55.57			62.25
Total LC and TI per square foot (2)	$	60.75		$	73.50		$	55.21		$	68.65		$	74.01
Occupancy		91.2	%		91.3	%		90.5	%		90.7	%		93.0	%
Standalone Retail Portfolio
Total leases executed		3			—			2			—			2
Total square footage executed		2,378			—			27,143			—			6,136
Average rent psf—leases executed	$	246.78		$	—		$	34.26		$	—		$	349.60
Previously escalated rents psf	$	221.47		$	—		$	40.83		$	—		$	312.18
Percentage of new rent over previously escalated rents		11.4	%		—			(16.1	%)		—			12.0	%
Leasing commission costs per square foot	$	48.45		$	—		$	—		$	—		$	13.56
Tenant improvement costs per square foot		—			—			—			—			—
Total LC and TI per square foot (2)	$	48.45		$	—		$	—		$	—		$	13.56
Occupancy		99.4	%		99.4	%		99.4	%		99.4	%		99.4	%

Notes:

⁽¹⁾  Includes 507,395 rentable square feet of retail space in the Company’s nine Manhattan office properties.

⁽²⁾  Presents all tenant improvement and leasing commission costs as if they were incurred in the period in which the lease was signed, which may be different than the period in which they were actually paid.

Page 8

Fourth Quarter 2017

Property Detail

(unaudited)

Property Name	Location or Sub-Market	Rentable Square Feet (1)		Percent Occupied (2)			Annualized Rent (3)		Annualized Rent per Occupied Square Foot (4)		Number of Leases (5)
Manhattan Office Properties—Office
The Empire State Building (6)	Penn Station -Times Sq. South		2,711,465		94.1	%	$	140,996,124	$	55.27		188
One Grand Central Place	Grand Central		1,246,187		89.2	%		62,246,491		56.01		228
1400 Broadway (8)	Penn Station -Times Sq. South		908,332		86.9	%		37,169,648		47.07		43
111 West 33rd Street (9)	Penn Station -Times Sq. South		638,297		69.3	%		24,658,939		55.76		17
250 West 57th Street	Columbus Circle - West Side		478,243		70.3	%		18,891,142		56.15		80
501 Seventh Avenue	Penn Station -Times Sq. South		460,081		95.5	%		19,196,258		43.71		29
1359 Broadway	Penn Station -Times Sq. South		455,627		97.0	%		22,564,538		51.08		37
1350 Broadway (10)	Penn Station -Times Sq. South		372,672		88.0	%		18,122,833		55.24		63
1333 Broadway	Penn Station -Times Sq. South		292,629		100.0	%		14,535,547		49.67		11
Manhattan Office Properties—Office			7,563,533		89.0	%		358,381,520		53.23		696
Manhattan Office Properties—Retail
The Empire State Building (7)	Penn Station -Times Sq. South		104,163		81.7	%		13,871,594		163.07		15
One Grand Central Place	Grand Central		69,029		79.1	%		6,153,613		112.71		14
1400 Broadway (8)	Penn Station -Times Sq. South		21,073		72.8	%		1,982,677		129.27		7
112 West 34th Street (9)	Penn Station -Times Sq. South		90,132		100.0	%		22,405,461		248.58		4
250 West 57th Street	Columbus Circle -West Side		61,422		79.7	%		8,039,729		164.20		8
501 Seventh Avenue	Penn Station -Times Sq. South		35,558		88.3	%		1,973,082		62.83		9
1359 Broadway	Penn Station -Times Sq. South		27,243		100.0	%		2,186,054		80.24		6
1350 Broadway (10)	Penn Station -Times Sq. South		31,774		100.0	%		6,764,180		212.88		6
1333 Broadway	Penn Station -Times Sq. South		67,001		100.0	%		8,682,963		129.59		4
Manhattan Office Properties—Retail			507,395		89.0	%		72,059,353		159.59		73
Sub-Total/Weighted Average Manhattan Office Properties—Office and Retail			8,070,928		89.0	%		430,440,873		59.92		769
Greater New York Metropolitan Area Office Properties
First Stamford Place (11)	Stamford, CT		793,142		92.7	%		31,303,108		42.56		55
Metro Center	Stamford, CT		285,258		88.4	%		14,316,027		56.75		28
383 Main Avenue	Norwalk, CT		262,639		89.4	%		7,613,636		32.41		21
500 Mamaroneck Avenue	Harrison, NY		294,570		88.1	%		7,382,500		28.46		34
10 Bank Street	White Plains, NY		232,361		95.6	%		7,933,195		35.71		36
Sub-Total/Weighted Average Greater New York Metropolitan Area Office Properties			1,867,970		91.2	%		68,548,466		40.22		174
Standalone Retail Properties
10 Union Square	Union Square		58,007		98.0	%		6,380,729		112.29		12
1542 Third Avenue	Upper East Side		56,250		100.0	%		3,802,424		67.60		4
1010 Third Avenue	Upper East Side		44,662		100.0	%		3,738,322		83.70		2
77 West 55th Street	Midtown		25,388		100.0	%		2,637,533		103.89		3
69-97 Main Street	Westport, CT		17,103		100.0	%		2,330,849		136.28		5
103-107 Main Street	Westport, CT		4,330		100.0	%		715,852		165.32		1
Sub-Total/Weighted Average Standalone Retail Properties			205,740		99.4	%		19,605,709		95.84		27
Portfolio Total			10,144,638		89.6	%	$	518,595,048	$	57.03		970
Total/Weighted Average Office Properties			9,431,503		89.5	%	$	426,929,986	$	50.60		870
Total/Weighted Average Retail Properties			713,135		92.0	%		91,665,062		139.72		100
Portfolio Total			10,144,638		89.6	%	$	518,595,048	$	57.03		970

Notes:

(1) Excludes (i) 154,797 square feet of space across the Company’s portfolio attributable to building management use and tenant amenities and (ii) 69,789 square feet of space attributable to the Company’s observatory.

(2) Based on leases signed and commenced as of December 31, 2017.

(3) Represents annualized base rent and current reimbursement for operating expenses and real estate taxes.

(4) Represents annualized rent under leases commenced as of December 31, 2017 divided by occupied square feet.

(5) Represents the number of leases at each property or on a portfolio basis. If a tenant has more than one lease, whether or not at the same property, but with different expirations, the number of leases is calculated equal to the number of leases with different expirations.

(6) Includes 70,426 rentable square feet of space leased by the Company’s broadcasting tenants.

(7) Includes 5,300 rentable square feet of space leased by WDFG North America, a licensee of the Company’s observatory.

(8) Denotes a ground leasehold interest in the property with a remaining term, including unilateral extension rights available to the Company, of approximately 46 years (expiring December 31, 2063).

(9) Denotes a ground leasehold interest in the property with a remaining term, including unilateral extension rights available to the Company, of approximately 60 years (expiring May 31, 2077).

(10) Denotes a ground leasehold interest in the property with a remaining term, including unilateral extension rights available to the Company, of approximately 33 years (expiring July 31, 2050).

(11) First Stamford Place consists of three buildings.

Page 9

Fourth Quarter 2017

Tenant Lease Expirations

(unaudited)

Total Lease Expirations	Number of Leases Expiring (1)		Rentable Square Feet Expiring (2)		Percent of Portfolio Rentable Square Feet Expiring			Annualized Rent (3)		Percent of Annualized Rent			Annualized Rent Per Rentable Square Foot
Available		—		791,669		7.8	%	$	—		0.0	%	$	—
Signed leases not commenced		18		260,054		2.6	%		—		0.0	%		—
1Q 2018		90		419,086		4.1	%		22,109,707		4.3	%		52.76
2Q 2018		40		180,831		1.8	%		10,322,032		2.0	%		57.08
3Q 2018		41		166,224		1.6	%		9,145,444		1.8	%		55.02
4Q 2018		44		163,992		1.6	%		7,072,884		1.4	%		43.13
Total 2018		215		930,133		9.1	%		48,650,067		9.4	%		52.30
2019		136		715,545		7.1	%		36,362,687		7.0	%		50.82
2020		140		858,570		8.5	%		46,895,729		9.0	%		54.62
2021		93		680,449		6.7	%		37,645,342		7.3	%		55.32
2022		90		624,204		6.2	%		37,277,999		7.2	%		59.72
2023		57		568,622		5.6	%		33,042,517		6.4	%		58.11
2024		50		541,985		5.3	%		30,754,134		5.9	%		56.74
2025		48		352,233		3.5	%		26,055,854		5.0	%		73.97
2026		39		950,836		9.4	%		51,223,509		9.9	%		53.87
2027		38		534,905		5.3	%		30,429,670		5.9	%		56.89
Thereafter		64		2,335,433		22.9	%		140,257,540		27.0	%		60.06
Total		988		10,144,638		100.0	%	$	518,595,048		100.0	%	$	57.03

Notes:

(1) If a lease has two different expiration dates, it is considered to be two leases (for the purpose of lease count and square footage).

(2) Excludes (i) 154,797 rentable square feet of space across the Company portfolio attributable to building management use and tenant amenities and (ii) 69,789 square feet of space attributable to the Company’s observatory.

(3) Represents annualized base rent and current reimbursement for operating expenses and real estate taxes.

Page 10

Fourth Quarter 2017

Tenant Lease Expirations

(unaudited)

	Number of Leases Expiring (2)		Rentable Square Feet Expiring (3)		Percent of Portfolio Rentable Square Feet Expiring			Annualized Rent (4)		Percent of Annualized Rent			Annualized Rent Per Rentable Square Foot
Manhattan Office Properties (1)
Available		—		595,051		7.9	%	$	—		0.0	%	$	—
Signed leases not commenced		13		235,900		3.1	%		—		0.0	%		—
1Q 2018		72		344,883		4.6	%		18,016,945		5.0	%		52.24
2Q 2018		30		129,189		1.7	%		7,482,955		2.1	%		57.92
3Q 2018		35		117,456		1.6	%		6,644,943		1.9	%		56.57
4Q 2018		32		122,309		1.6	%		6,221,616		1.7	%		50.87
Total 2018		169		713,837		9.5	%		38,366,459		10.7	%		53.75
2019		107		468,407		6.2	%		24,005,483		6.7	%		51.25
2020		107		626,176		8.3	%		34,393,770		9.6	%		54.93
2021		56		442,320		5.8	%		23,481,522		6.6	%		53.09
2022		66		340,773		4.5	%		19,608,532		5.5	%		57.54
2023		41		417,611		5.5	%		22,454,697		6.3	%		53.77
2024		32		330,906		4.4	%		16,923,168		4.7	%		51.14
2025		28		203,223		2.7	%		11,571,385		3.2	%		56.94
2026		28		831,298		11.0	%		45,293,409		12.6	%		54.49
2027		24		382,903		5.1	%		20,990,524		5.9	%		54.82
Thereafter		38		1,975,128		26.0	%		101,292,571		28.2	%		51.28
Total Manhattan office properties		709		7,563,533		100.0	%		358,381,520		100.0	%		53.23
Greater New York Metropolitan Area Office Properties
Available		—		153,202		8.2	%	$	—		0.0	%	$	—
Signed leases not commenced		2		10,512		0.6	%		—		0.0	%		—
1Q 2018		14		54,661		2.9	%		2,065,768		3.0	%		37.79
2Q 2018		8		47,520		2.5	%		2,268,873		3.3	%		47.75
3Q 2018		5		46,763		2.5	%		2,229,710		3.3	%		47.68
4Q 2018		11		41,439		2.2	%		825,160		1.2	%		19.91
Total 2018		38		190,383		10.1	%		7,389,511		10.8	%		38.81
2019		22		216,182		11.6	%		8,057,664		11.8	%		37.27
2020		24		203,761		10.9	%		8,954,726		13.1	%		43.97
2021		30		208,484		11.2	%		9,214,763		13.4	%		44.20
2022		15		223,135		11.9	%		8,706,111		12.7	%		39.02
2023		8		101,178		5.4	%		4,743,694		6.9	%		46.88
2024		6		182,660		9.8	%		8,109,683		11.8	%		44.40
2025		12		111,685		6.0	%		3,752,189		5.5	%		33.60
2026		3		49,187		2.6	%		1,483,338		2.2	%		30.16
2027		6		64,229		3.4	%		2,300,672		3.4	%		35.82
Thereafter		10		153,372		8.3	%		5,836,115		8.4	%		38.05
Total greater New York metropolitan area office properties		176		1,867,970		100.0	%		68,548,466		100.0	%		40.22
Retail Properties
Available		—		43,416		6.1	%	$	—		0.0	%	$	—
Signed leases not commenced		3		13,642		1.9	%		—		0.0	%		—
1Q 2018		4		19,542		2.7	%		2,026,994		2.2	%		103.73
2Q 2018		2		4,122		0.6	%		570,204		0.6	%		138.33
3Q 2018		1		2,005		0.3	%		270,791		0.3	%		135.06
4Q 2018		1		244		0.0	%		26,108		0.0	%		107.00
Total 2018		8		25,913		3.6	%		2,894,097		3.1	%		111.69
2019		7		30,956		4.3	%		4,299,540		4.7	%		138.89
2020		9		28,633		4.0	%		3,547,233		3.9	%		123.89
2021		7		29,645		4.2	%		4,949,057		5.4	%		166.94
2022		9		60,296		8.5	%		8,963,356		9.8	%		148.66
2023		8		49,833		7.0	%		5,844,126		6.4	%		117.27
2024		12		28,419		4.0	%		5,721,283		6.2	%		201.32
2025		8		37,325		5.2	%		10,732,280		11.7	%		287.54
2026		8		70,351		9.9	%		4,446,762		4.9	%		63.21
2027		8		87,773		12.3	%		7,138,474		7.8	%		81.33
Thereafter		16		206,933		29.0	%		33,128,854		36.1	%		160.09
Total retail properties		103		713,135		100.0	%		91,665,062		100.0	%		139.72
Total portfolio lease expirations		988		10,144,638		100.0	%	$	518,595,048		100.0	%	$	57.03

Notes:

(1) Excludes (i) retail space in the Company’s Manhattan office properties and (ii) the Empire State Building broadcasting licenses and observatory operations.

(2) If a lease has two different expiration dates, it is considered to be two leases (for the purpose of lease count and square footage).

(3) Excludes (i) 154,797 rentable square feet of space across the Company portfolio attributable to building management use and tenant amenities and (ii) 69,789 square feet of space attributable to the Company’s observatory.

(4) Represents annualized base rent and current reimbursement for operating expenses and real estate taxes.

Page 11

Fourth Quarter 2017

Tenant Lease Expirations

(unaudited)

	Number of Leases Expiring (2)		Rentable Square Feet Expiring (3)		Percent of Portfolio Rentable Square Feet Expiring			Annualized Rent (4) (5)		Percent of Annualized Rent			Annualized Rent Per Rentable Square Foot
Empire State Building Office (1)
Available		—		142,984		5.3	%	$	—		0.0	%	$	—
Signed leases not commenced		2		17,252		0.6	%		—		0.0	%		—
1Q 2018		16		45,645		1.7	%		2,644,728		1.9	%		57.94
2Q 2018		4		12,020		0.4	%		776,129		0.6	%		64.57
3Q 2018		4		32,842		1.2	%		1,980,818		1.4	%		60.31
4Q 2018		5		15,719		0.6	%		965,933		0.7	%		61.45
Total 2018		29		106,226		3.9	%		6,367,608		4.6	%		59.94
2019		18		65,866		2.4	%		3,604,392		2.6	%		54.72
2020		37		300,273		11.1	%		17,579,126		12.5	%		58.54
2021		17		117,943		4.3	%		6,559,723		4.7	%		55.62
2022		23		101,883		3.8	%		6,297,008		4.5	%		61.81
2023		12		72,766		2.7	%		4,550,859		3.2	%		62.54
2024		11		79,959		2.9	%		4,885,156		3.5	%		61.10
2025		6		57,433		2.1	%		3,117,717		2.2	%		54.28
2026		11		502,152		18.5	%		28,149,072		20.0	%		56.06
2027		4		16,613		0.6	%		1,134,079		0.8	%		68.26
Thereafter		20		1,130,115		41.8	%		58,751,384		41.4	%		51.99
Total Empire State Building office		190		2,711,465		100.0	%	$	140,996,124		100.0	%	$	55.27
					Annualized Base Rent (6)			Annualized Expense Reimbursements		Annualized Rent (4) (7)			Percent of Annualized Rent
Empire State Building Broadcasting Licenses and Leases
1Q 2018					$	18,450		$	17,930	$	36,380			0.2	%
2Q 2018						917,909			393,744		1,311,653			6.8	%
3Q 2018						1,424,351			798,634		2,222,985			11.5	%
4Q 2018						950,515			645,932		1,596,447			8.2	%
Total 2018						3,311,225			1,856,240		5,167,465			26.7	%
2019						212,240			48,119		260,359			1.3	%
2020						1,470,154			365,505		1,835,659			9.5	%
2021						55,685			109,560		165,245			0.9	%
2022						1,088,769			283,605		1,372,374			7.1	%
2023						82,480			24,060		106,540			0.5	%
2024						45,894			66,959		112,853			0.6	%
2025						1,638,975			262,762		1,901,737			9.8	%
2026						768,750			153,634		922,384			4.8	%
2027						750,000			106,814		856,814			4.4	%
Thereafter						5,849,963			845,781		6,695,744			34.4	%
Total Empire State Building broadcasting licenses and leases					$	15,274,135		$	4,123,039	$	19,397,174			100.0	%

Notes:

(1) Excludes retail space, broadcasting licenses and observatory operations

(2) If a lease has two different expiration dates, it is considered to be two leases (for the purpose of lease count and square footage).

(3) Excludes 25,937 rentable square feet of space attributable to building management use.

(4) Represents annualized base rent and current reimbursement for operating expenses and real estate taxes.

(5) Includes approximately $8.4 million of annualized rent related to physical space occupied by broadcasting tenants for their broadcasting operations. Does not include license fees charged to broadcasting tenants.

(6) Represents license fees for the use of the Empire State Building mast and base rent for physical space occupied by broadcasting tenants.

(7) Excludes Fox Television whose lease expired during 2017 and was billed holdover rent as of December 31, 2017.

Page 12

Fourth Quarter 2017

20 Largest Tenants and Portfolio Tenant Diversification by Industry

(unaudited)

	Property	Lease Expiration (1)	Weighted Average Remaining Lease Term(2)		Total Occupied Square Feet (3)		Percent of Portfolio Rentable Square Feet (4)			Annualized Rent (5)		Percent of Portfolio Annualized Rent (6)
20 Largest Tenants
1. Global Brands Group	ESB, 1333 B’Way, 111 West 33rd	Dec 2017 - Oct. 2028		9.8 years		692,098		6.8	%	$	32,575,558		6.3	%
2. Coty	ESB	Jan. 2030		12.1 years		312,700		3.1	%		15,941,278		3.1	%
3. LinkedIn	ESB	Feb. 2026		8.2 years		282,782		2.8	%		15,031,208		2.9	%
4. PVH Corp.	501 Seventh Avenue	Dec 2017 - Oct. 2028		10.3 years		238,392		2.4	%		10,510,640		2.0	%
5. Sephora	112 West 34th Street	Jan. 2029		11.1 years		11,334		0.1	%		10,445,512		2.0	%
6. Li & Fung	1359 Broadway	Oct. 2021-Oct. 2027		6.3 years		149,436		1.5	%		7,262,106		1.4	%
7. Federal Deposit Insurance Corp.	ESB	Jan. 2020		2.1 years		121,879		1.2	%		7,013,460		1.4	%
8. Urban Outfitters	1333 Broadway	Sept. 2029		11.8 years		56,730		0.6	%		6,831,008		1.3	%
9. Macy’s	111 West 33rd Street	May 2030		12.4 years		131,117		1.3	%		6,637,266		1.3	%
10. Duane Reade	ESB, 1350 B’Way, 250 West 57th	Feb. 2021-Sept. 2027		6.9 years		47,541		0.5	%		6,281,730		1.2	%
11. Legg Mason	First Stamford Place	Sept. 2024		6.8 years		137,583		1.4	%		6,228,319		1.2	%
12. Footlocker	112 West 34th Street	Sept. 2031		13.8 years		34,192		0.3	%		6,224,766		1.2	%
13. On Deck Capital	1400 Broadway	Dec. 2026		9.0 years		107,800		1.1	%		5,821,720		1.1	%
14. Shutterstock	ESB	Apr. 2029		11.3 years		104,386		1.0	%		5,589,650		1.1	%
15. WDFG North America	ESB	Dec. 2025		7.9 years		5,300		0.1	%		5,516,399		1.1	%
16. Thomson Reuters	Metro Center	Apr. 2018-Apr. 2020		1.8 years		91,921		0.9	%		4,851,483		0.9	%
17. Kohl’s	1400 Broadway	May 2029		11.4 years		113,032		1.1	%		4,834,319		0.9	%
18. The Gap, Inc.	111 West 33rd Street	Jan. 2030		12.1 years		80,903		0.8	%		4,611,471		0.9	%
19. HNTB Corporation	ESB	Feb. 2026		8.2 years		78,361		0.8	%		4,592,963		0.9	%
20. The Michael J. Fox Foundation	111 West 33rd Street	Nov. 2029		11.9 years		75,959		0.7	%		4,557,539		0.9	%
Total						2,873,446		28.5	%	$	171,358,395		33.1	%

Notes:

(1) Expiration dates are per lease and do not assume exercise of renewal or extension options. For tenants with more than two leases, the lease expiration is shown as a range.

(2) Represents the weighted average lease term, based on annualized rent.

(3) Based on leases signed and commenced as of December 31, 2017.

(4) Represents the percentage of rentable square feet of the Company’s office and retail portfolios in the aggregate.

(5) Represents annualized base rent and current reimbursement for operating expenses and real estate taxes.

(6) Represents the percentage of annualized rent of the Company’s office and retail portfolios in the aggregate.

Portfolio Tenant Diversification by Industry (based on annualized rent)

Page 13

Fourth Quarter 2017

Capital Expenditures and Redevelopment Program and Leasing Opportunity

(unaudited)

	Three Months Ended
Capital expenditures	December 31, 2017		September 30, 2017		June 30, 2017		March 31, 2017		December 31, 2016
Tenant improvements - first generation	$	17,680	$	16,219	$	20,557	$	25,254	$	28,575
Tenant improvements - second generation		6,966		6,058		4,764		2,464		3,122
Leasing commissions - first generation		6,207		7,416		7,683		2,538		3,077
Leasing commissions - second generation		2,996		817		192		1,071		467
Building improvements - first generation		19,591		15,759		26,680		19,935		21,800
Building improvements - second generation		3,566		2,105		2,337		30		1,754
Observatory capital project		16,360		13,411		6,850		—		—
Total	$	73,366	$	61,785	$	69,063	$	51,292	$	58,795

Tenant space redevelopment by square feet ^{(1) (2)}

• Future redevelopment (Empire State Building) - 240,000 square feet

• Future redevelopment (other Manhattan properties) - 720,000 square feet

• Redevelopment completed - 7,010,000 square feet

Inventory of vacant space ⁽²⁾

• Developed - 550,000 square feet, 90% ⁽³⁾

• Undeveloped - 60,000 square feet, 10%

Inventory of undeveloped space ⁽²⁾

• Vacant - 60,000 square feet, 6%

• Expires in 2018 - 290,000 square feet, 30%

• Expires in 2019 and thereafter - 610,000 square feet, 64%

Leasing Opportunity - Inventory of Current Vacant Space and Expected Space to be Vacated by year-end 2018

	Square Feet
Total portfolio vacant space		1,052,000
Less signed leases not commenced (“SLNC”)		(260,000	)
Total portfolio net vacant space		792,000
Less retail vacant space		(44,000	)
Less GNYMA vacant space		(153,000	)
Manhattan office vacant space, excluding SLNC		595,000
Less current redeveloped Manhattan office space		(425,000	)
Less space held off market for consolidation/redevelopment		(90,000	)
Space being planned for redevelopment, storage and other		80,000
Total portfolio expected space to be vacated by year-end 2018 at fully escalated rent of $49.34 PSF		700,000

Notes:

⁽¹⁾  These estimates are based on the Company’s current budgets and are subject to change.

⁽²⁾  Redevelopment program is for the Manhattan office assets only. Square footage based on market measurement. Developed space includes space that has been demolished and completed asbestos abatement and available for lease up or ready to be prebuilt. Permanent building use spaces, amenity spaces and broadcasting spaces are excluded.

⁽³⁾  Includes 425,000 square feet of redeveloped Manhattan office space, 38,000 square feet of redeveloped retail space and the balance reflects space held off-market.

Page 14

Fourth Quarter 2017

Observatory Summary

(unaudited and in thousands)

			Three Months Ended
	Twelve Months to Date		December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016
Observatory NOI
Observatory revenue	$	127,118	$	32,906		$	39,306		$	33,966		$	20,940		$	33,702
Observatory expenses		30,275		7,196			8,648			7,176			7,255			7,933
NOI		96,843		25,710			30,658			26,790			13,685			25,769
Intercompany rent expense (1)		77,646		20,292			23,301			20,675			13,378			20,469
NOI after intercompany rent	$	19,197	$	5,418		$	7,357		$	6,115		$	307		$	5,300
Observatory Metrics
Number of visitors				1,014,000			1,276,000			1,126,000			636,000			1,068,000
Change in visitors year over year				(5.1	%)		(4.8	%)		0.2	%		(11.5	%)		12.5	%
Number of bad weather days (“BWD”) (2)				10			14			15			22			14
Estimated effect of BWD’s on number of visitors (3)				(2,000	)		(38,000	)		(65,000	)		n/a			n/a

Notes:

⁽¹⁾  The observatory pays a market-based rent payment comprised of fixed and percentage rent to the Empire State Building. Intercompany rent is eliminated upon consolidation.

⁽²⁾  The Company defines a bad weather day as one in which the top of the Empire State Building is obscured from view for more than 50% of the day.

⁽³⁾  This metric commenced in the second quarter 2017. Represents an estimated reduction in the number of visitors due to bad weather days.

Annual Observatory Revenues 2013 to 2017

Page 15

Fourth Quarter 2017

Condensed Consolidated Balance Sheets

(unaudited and dollars in thousands)

	December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016
Assets
Commercial real estate properties, at cost:
Land	$	201,196		$	201,196		$	201,196		$	201,196		$	201,196
Development costs		7,986			7,978			7,978			7,977			7,951
Building and improvements		2,458,473			2,398,964			2,347,435			2,292,363			2,249,482
		2,667,655			2,608,138			2,556,609			2,501,536			2,458,629
Less: accumulated depreciation		(656,900	)		(631,916	)		(605,481	)		(581,703	)		(556,546	)
Commercial real estate properties, net		2,010,755			1,976,222			1,951,128			1,919,833			1,902,083
Cash and cash equivalents		464,344			432,105			440,958			532,442			554,371
Restricted cash		65,853			64,020			68,011			62,464			61,514
Tenant and other receivables, net		28,329			34,661			23,995			20,580			22,542
Deferred rent receivables, net		178,629			172,665			165,470			158,005			152,074
Prepaid expenses and other assets		61,028			39,463			54,624			36,815			53,749
Deferred costs, net		262,701			268,132			263,392			270,456			277,081
Acquired below-market ground leases, net		368,229			370,187			372,144			374,102			376,060
Goodwill		491,479			491,479			491,479			491,479			491,479
Total assets	$	3,931,347		$	3,848,934		$	3,831,201		$	3,866,176		$	3,890,953
Liabilities and Equity
Mortgage notes payable, net	$	717,164		$	720,830		$	724,312		$	754,548		$	759,016
Senior unsecured notes, net		707,895			592,914			592,073			591,232			590,388
Unsecured term loan facility, net		263,662			263,546			263,114			263,019			262,927
Unsecured revolving credit facility		—			—			—			—			—
Accounts payable and accrued expenses		110,849			142,690			136,617			125,910			134,064
Acquired below-market leases, net		66,047			70,013			74,083			78,246			82,300
Deferred revenue and other liabilities		40,907			41,320			27,380			31,097			32,212
Tenants’ security deposits		47,086			47,395			49,669			47,198			47,183
Total liabilities		1,953,610			1,878,708			1,867,248			1,891,250			1,908,090
Total equity		1,977,737			1,970,226			1,963,953			1,974,926			1,982,863
Total liabilities and equity	$	3,931,347		$	3,848,934		$	3,831,201		$	3,866,176		$	3,890,953

Page 16

Fourth Quarter 2017

Condensed Consolidated Statements of Income

(unaudited and in thousands, except per share amounts)

	Three Months Ended
	December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016
Revenues
Rental revenue	$	123,596		$	122,391		$	120,844		$	117,113		$	117,498
Tenant expense reimbursement		19,790			20,346			17,569			15,974			17,109
Observatory revenue		32,906			39,306			33,966			20,940			33,702
Third party management and other fees		312			345			392			351			394
Other revenue and fees		6,466			4,932			4,353			10,576			10,560
Total revenues		183,070			187,320			177,124			164,954			179,263
Operating expenses
Property operating expenses		41,522			41,270			38,529			42,210			38,775
Ground rent expenses		2,332			2,331			2,332			2,331			2,332
General and administrative expenses		13,749			12,899			12,579			11,088			13,455
Observatory expenses		7,196			8,648			7,176			7,255			7,933
Real estate taxes		26,465			26,901			24,542			24,558			24,288
Depreciation and amortization		40,842			38,490			40,532			40,846			39,829
Total operating expenses		132,106			130,539			125,690			128,288			126,612
Total operating income		50,964			56,781			51,434			36,666			52,651
Other income (expense)
Interest expense		(16,364	)		(16,890	)		(17,477	)		(17,742	)		(17,837	)
Loss on early extinguishment of debt		—			(2,157	)		—			—			—
Loss from derivative financial instruments		—			—			(42	)		(247	)		—
Income before income taxes		34,600			37,734			33,915			18,677			34,814
Income tax (expense) benefit		(2,340	)		(2,245	)		(2,556	)		468			(1,806	)
Net income		32,260			35,489			31,359			19,145			33,008
Perpetual preferred unit distributions		(234	)		(234	)		(234	)		(234	)		(234	)
Net income attributable to non-controlling interests		(14,754	)		(16,449	)		(14,541	)		(8,926	)		(15,808	)
Net income attributable to common stockholders	$	17,272		$	18,806		$	16,584		$	9,985		$	16,966
Weighted average common shares outstanding
Basic		159,989			158,102			157,921			156,493			153,273
Diluted		297,898			297,871			298,398			297,962			297,046
Net income per share attributable to common stockholders
Basic and diluted	$	0.11		$	0.12		$	0.10		$	0.06		$	0.11
Dividends per share	$	0.105		$	0.105		$	0.105		$	0.105		$	0.105

Page 17

Fourth Quarter 2017

Funds from Operations (“FFO”), Modified Funds From Operations (“Modified FFO”), Core Funds from

Operations (“Core FFO”), Core Funds Available for Distribution (“Core FAD”) and EBITDA

(unaudited and in thousands, except per share amounts)

	Three Months Ended
	December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016
Reconciliation of Net Income to FFO, Modified FFO and Core FFO
Net Income	$	32,260		$	35,489		$	31,359		$	19,145		$	33,008
Preferred unit distributions		(234	)		(234	)		(234	)		(234	)		(234	)
Real estate depreciation and amortization		40,484			38,134			40,132			40,424			39,426
FFO attributable to common stockholders and non-controlled interests		72,510			73,389			71,257			59,335			72,200
Amortization of below-market ground lease		1,958			1,957			1,958			1,958			1,958
Modified FFO attributable to common stockholders and non-controlled interests		74,468			75,346			73,215			61,293			74,158
Deferred tax asset write-off		446			—			—			—			—
Loss on early extinguishment of debt		—			2,157			—			—			—
Core FFO attributable to common stockholders and non-controlled interests	$	74,914		$	77,503		$	73,215		$	61,293		$	74,158
Total weighted average shares and Operating Partnership Units
Basic		296,654			296,389			296,388			296,388			296,084
Diluted		297,898			297,871			298,398			297,962			297,046
FFO attributable to common stockholders and non-controlled interests per share
Basic	$	0.24		$	0.25		$	0.24		$	0.20		$	0.24
Diluted	$	0.24		$	0.25		$	0.24		$	0.20		$	0.24
Modified FFO attributable to common stockholders and non-controlled interests per share
Basic	$	0.25		$	0.25		$	0.25		$	0.21		$	0.25
Diluted	$	0.25		$	0.25		$	0.25		$	0.21		$	0.25
Core FFO attributable to common stockholders and non-controlled interests per share
Basic	$	0.25		$	0.26		$	0.25		$	0.21		$	0.25
Diluted	$	0.25		$	0.26		$	0.25		$	0.21		$	0.25
Reconciliation of Core FFO to Core FAD
Core FFO	$	74,914		$	77,503		$	73,215		$	61,293		$	74,158
Add:
Amortization of deferred financing costs		1,036			1,017			1,331			1,294			1,293
Non-real estate depreciation and amortization		358			356			400			422			403
Amortization of non-cash compensation expense		3,292			3,841			3,813			3,154			2,476
Amortization of debt discount		667			668			668			668			668
Deduct:
Straight-line rental revenues		(5,963	)		(6,861	)		(7,722	)		(5,998	)		(8,652	)
Amortization of debt premiums		(1,737	)		(1,736	)		(1,737	)		(1,737	)		(1,737	)
Above/below-market rent revenue amortization		(1,567	)		(1,607	)		(1,119	)		(1,428	)		(2,509	)
Corporate capital expenditures		(5	)		—			(10	)		(382	)		(285	)
Tenant improvements—second generation		(6,966	)		(6,058	)		(4,764	)		(2,464	)		(3,122	)
Building improvements—second generation		(3,566	)		(2,105	)		(2,337	)		(30	)		(1,754	)
Leasing commissions—second generation		(2,996	)		(817	)		(192	)		(1,071	)		(467	)
Core FAD	$	57,467		$	64,201		$	61,546		$	53,721		$	60,472
Reconciliation of Net Income to EBITDA
Net income	$	32,260		$	35,489		$	31,359		$	19,145		$	33,008
Interest expense		16,364			16,890			17,477			17,742			17,837
Income tax expense (benefit)		2,340			2,245			2,556			(468	)		1,806
Depreciation and amortization		40,842			38,490			40,532			40,846			39,829
EBITDA	$	91,806		$	93,114		$	91,924		$	77,265		$	92,480

Page 18

Fourth Quarter 2017

Debt Summary

(unaudited and dollars in thousands)

	December 31, 2017								September 30, 2017
				Weighted Average								Weighted Average
Debt Summary	Balance			Interest Rate			Maturity (Years)		Balance			Interest Rate			Maturity (Years)
Fixed rate mortgage debt	$	721,224			4.78	%		6.1	$	723,221			4.78	%		6.4
Senior unsecured notes		715,000			3.57	%		6.9		600,000			3.47	%		6.6
Unsecured term loan facility (1)		265,000			3.35	%		4.7		265,000			3.35	%		4.9
Total fixed rate debt		1,701,224			4.05	%		6.2		1,588,221			4.05	%		6.2
Unsecured revolving credit facility		—			—			3.7		—			—			3.9
Total variable rate debt		—			—			3.7		—			—			3.9
Total debt		1,701,224			4.05	%		6.2		1,588,221			4.05	%		6.2
Premium/discount		(3,370	)							(2,301	)
Deferred financing costs, net		(9,133	)							(8,630	)
Total	$	1,688,721							$	1,577,290

Note:

⁽¹⁾  Beginning August 2017, LIBOR was fixed at 2.1485% under a variable to fixed interest rate swap agreement.

⁽²⁾  Capitalized interest for 2017 was $0.5 million.

Available Capacity	Facility		Outstanding at December 31, 2017		Letters of Credit		Available Capacity
Unsecured revolving credit facility (1)	$	1,100,000	$	—	$	—	$	1,100,000

Covenant Summary	Required			Current Quarter			In Compliance
Maximum Total Leverage(2)		< 60	%		24.8	%		Yes
Maximum Secured Debt		< 40	%		10.5	%		Yes
Minimum Fixed Charge Coverage		> 1.50x			4.8x			Yes
Minimum Unencumbered Interest Coverage		> 1.75x			7.9x			Yes
Maximum Unsecured Leverage		< 60	%		21.0	%		Yes
Minimum Tangible Net Worth	$	1,249,392		$	1,710,804			Yes

Notes:

⁽¹⁾  The unsecured revolving credit and term loan facility has an accordion feature allowing for an increase in maximum aggregate principal balance to $1.75 billion under certain circumstances. This unsecured revolving credit facility matures in August 2021 with two additional six-month extension options.

⁽²⁾  Represents the ratio of total indebtedness to total asset value as defined and determined in accordance with the credit facility agreement.

Page 19

Fourth Quarter 2017

Debt Detail

(unaudited and dollars in thousands)

	Stated Interest Rate (%)			Current Interest Rate (%)			Principal Balance			Maturity Date		Amortization
Fixed rate mortgage debt:
1333 Broadway (1)		6.32	%		6.32	%	$	66,602			1/5/2018	30 years
1400 Broadway (first lien mortgage loan) (1)		6.12	%		6.12	%		66,632			2/5/2018	30 years
1400 Broadway (second lien mortgage loan) (1)		3.35	%		3.35	%		9,172			2/5/2018	30 years
111 West 33rd Street (first lien mortgage loan)		6.01	%		6.01	%		74,045			4/5/2018	30 years
111 West 33rd Street (second lien mortgage loan)		6.56	%		6.56	%		9,369			4/5/2018	30 years
1350 Broadway		5.87	%		5.87	%		37,144			4/5/2018	30 years
Metro Center		3.59	%		3.59	%		93,948			11/5/2024	30 years
10 Union Square		3.70	%		3.70	%		50,000			4/1/2026	Interest only
1542 Third Avenue		4.29	%		4.29	%		30,000			5/1/2027	Interest only
First Stamford Place (2)		4.28	%		4.28	%		180,000			7/1/2027	5 year interest only; 30 years thereafter
1010 Third Avenue and 77 West 55th Street		4.01	%		4.01	%		39,710			1/5/2028	30 years
10 Bank Street		4.23	%		4.23	%		34,602			6/1/2032	25 years
383 Main Avenue		4.44	%		4.44	%		30,000			6/30/2032	5 year interest only; 30 years thereafter
Total mortgage debt								721,224
Exchangeable senior unsecured notes		2.63	%		2.63	%		250,000			8/15/2019	Interest only
Unsecured revolving credit facility		LIBOR plus 1.10	%		2.66	%		—			8/29/2021	Interest only
Unsecured term loan facility (3)		LIBOR plus 1.20	%		3.35	%		265,000			8/29/2022	Interest only
Senior unsecured notes (Series A)		3.93	%		3.93	%		100,000			3/27/2025	Interest only
Senior unsecured notes (Series B)		4.09	%		4.09	%		125,000			3/27/2027	Interest only
Senior unsecured notes (Series C)		4.18	%		4.18	%		125,000			3/27/2030	Interest only
Senior unsecured notes (Series D)		4.08	%		4.08	%		115,000			1/22/2028	Interest only
Senior unsecured notes (Series E) (4)		4.26	%		4.26	%		—			3/22/2030	Interest only
Senior unsecured notes (Series F) (4)		4.44	%		4.44	%		—			3/22/2033	Interest only
Total / weighted average debt					4.05	%		1,701,224
Premium/discounts								(3,370	)
Deferred financing costs, net								(9,133	)
Total							$	1,688,721

Notes:

⁽¹⁾  During January 2018, the Company refinanced and increased its mortgage debt on 1333 Broadway from $66.6 million to $160 million, due February 2033 with interest fixed at 4.21%. A portion of this increase was applied to release the $75.8 million mortgage lien on 1400 Broadway.

⁽²⁾  Represents a $164 million mortgage loan bearing interest of 4.09% and a $16 million loan bearing interest at 6.25%.

⁽³⁾  Beginning August 2017, LIBOR was fixed at 2.1485% under a variable to fixed interest rate swap agreement.

⁽⁴⁾  Senior unsecured notes Series E, totaling $160 million, and Series F, totaling $175 million, will be sold and purchased in March 2018.

Page 20

Fourth Quarter 2017

Debt Maturities and Ground Lease Commitments

(unaudited and dollars in thousands)

Year	Amortization		Maturities (1)		Total			Percentage of Total Debt			Weighted Average Interest Rate of Maturing Debt
2018	$	4,417	$	262,195	$	266,612			15.7	%		6.02	%
2019		3,790		250,000		253,790			14.9	%		2.63	%
2020		3,938		—		3,938			0.2	%		n/a
2021		4,090		—		4,090			0.2	%		n/a
2022		5,455		265,000		270,455			15.9	%		3.35	%
Thereafter		37,890		864,449		902,339			53.1	%		4.07	%
Total debt	$	59,580	$	1,641,644		1,701,224			100.0	%		4.05	%
Premium/discount						(3,370	)
Deferred financing costs, net						(9,133	)
Total					$	1,688,721

Note:

(1) Assumes no extension options are exercised.

Debt Maturity Profile

Ground Lease Commitments

Year	1350 Broadway		1400 Broadway		111 West 33rd Street		Total
2018		108		675		735		1,518
2019		108		675		735		1,518
2020		108		675		735		1,518
2021		108		675		735		1,518
2022		108		675		735		1,518
Thereafter		2,223		11,475		39,996		53,694
	$	2,763	$	14,850	$	43,671	$	61,284

Page 21

Fourth Quarter 2017

Supplemental Definitions

Funds From Operations (“FFO”)

We compute FFO in accordance with the “White Paper” on FFO published by the National Association of Real Estate Investment Trusts, or NAREIT, which defines FFO as net income (loss) (determined in accordance with GAAP), excluding impairment writedowns of investments in depreciable real estate and investments in in-substance real estate investments, gains or losses from debt restructurings and sales of depreciable operating properties, plus real estate-related depreciation and amortization (excluding amortization of deferred financing costs), less distributions to non-controlling interests and gains/losses from discontinued operations and after adjustments for unconsolidated partnerships and joint ventures. FFO is a widely recognized non-GAAP financial measure for REITs that we believe, when considered with financial statements determined in accordance with GAAP, is useful to investors in understanding financial performance and providing a relevant basis for comparison among REITs. In addition, FFO is useful to investors as it captures features particular to real estate performance by recognizing that real estate has generally appreciated over time or maintains residual value to a much greater extent than do other depreciable assets. Investors should review FFO, along with GAAP net income, when trying to understand an equity REIT’s operating performance. We present FFO because we consider it an important supplemental measure of our operating performance and believe that it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs. However, because FFO excludes depreciation and amortization and captures neither the changes in the value of our properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effect and could materially impact our results of operations, the utility of FFO as a measure of its performance is limited. There can be no assurance that FFO presented by us is comparable to similarly titled measures of other REITs. FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions. Although FFO is a measure used for comparability in assessing the performance of REITs, as the NAREIT White Paper only provides guidelines for computing FFO, the computation of FFO may vary from one company to another.

Modified Funds From Operations (“Modified FFO”)

Modified FFO adds back an adjustment for any above or below-market ground lease amortization to traditionally defined FFO. We consider this a useful supplemental measure in evaluating our operating performance due to the non-cash accounting treatment under GAAP, which stems from the third quarter 2014 acquisition of two option properties following our formation transactions as they carry significantly below market ground leases, the amortization of which is material to our overall results. We present Modified FFO because we consider it an important supplemental measure of our operating performance in that it adds back the non-cash amortization of below-market ground leases. There can be no assurance that Modified FFO presented by us is comparable to similarly titled measures of other REITs. Modified FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. Modified FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions.

Core Funds From Operations (“Core FFO”)

Core FFO adds back to Modified FFO the following items: deferred tax asset write-off, loss on early extinguishment of debt, acquisition expenses, acquisition break-up fee and construction severance expenses. The Company presents Core FFO because it considers it an important supplemental measure of its operating performance in that it excludes non-recurring items. There can be no assurance that Core FFO presented by the Company is comparable to similarly titled measures of other REITs. Core FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. Core FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions. In future periods, we may also exclude other items from Core FFO that we believe may help investors compare our results.

Core Funds Available for Distribution (“Core FAD”)

In addition to Core FFO, we present Core FAD by (i) adding to Core FFO non-real estate depreciation and amortization, the amortization of deferred financing costs, amortization of debt discounts and non-cash compensation expenses and (ii) deducting straight line rent, recurring second generation leasing commissions, tenant improvements, prebuilts, capital expenditures, furniture, fixtures & equipment, amortization of debt premiums and above/below market rent revenue. Core FAD is presented solely as a supplemental disclosure that we believe provides useful information regarding our ability to fund our dividends. Core FAD does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. Core FAD is not indicative of cash available to fund ongoing cash needs., including the ability to make cash distributions. There can be no assurance that Core FAD presented by us is comparable to similarly titled measures of other REITs.

Net Operating Income (NOI)

NOI is a non-GAAP financial measure of performance. NOI is used by our management to evaluate and compare the performance of our properties and to determine trends in earnings and to compute the fair value of our properties as it is not affected by; (i) the cost of funds of the property owner, (ii) the impact of depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets that are included in net income computed in accordance with GAAP, (iii) acquisition expenses and break-up fee, or (iv) general and administrative expenses and other gains and losses that are specific to the property owner. The cost of funds is eliminated from net operating income because it is specific to the particular financing capabilities and constraints of the owner. The cost of funds is also eliminated because it is dependent on historical interest rates and other costs of capital as well as past decisions made by us regarding the appropriate mix of capital which may have changed or may change in the future. Depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets are eliminated because they may not accurately represent the actual change in value in our office or retail properties that result from use of the properties or changes in market conditions. While certain aspects of real property do decline in value over time in a manner that is reasonably captured by depreciation and amortization, the value of the properties as a whole have historically increased or decreased as a result of changes in overall economic conditions instead of from actual use of the property or the passage of time. Gains and losses from the sale of real property vary from property to property and are affected by market conditions at the time of sale which will usually change from period to period. These gains and losses can create distortions when comparing one period to another or when comparing our operating results to the operating results of other real estate companies that have not made similarly timed, purchases or sales. We believe that eliminating these costs from net income is useful because the resulting measure captures the actual revenue, generated and actual expenses incurred in operating our properties as well as trends in occupancy rates, rental rates and operating costs. However, the usefulness of NOI is limited because it excludes general and administrative costs, interest expense, depreciation and amortization expense and gains or losses from the sale of properties, and other gains and losses as stipulated by GAAP, the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, all of which are significant economic costs. NOI may fail to capture significant trends in these components of net income which further limits its usefulness. NOI is a measure of the operating performance of our properties but does not measure our performance as a whole. NOI is therefore not a substitute for net income as computed in accordance with GAAP. This measure should be analyzed in conjunction with net income computed in accordance with GAAP. Other companies may use different methods for calculating NOI or similarly titled measures and, accordingly, our NOI may not-be comparable to similarly titled measures reported by other companies that do not define the measure exactly as we do.

EBITDA

We compute EBITDA as net income plus interest expense, income taxes and depreciation. We present EBITDA because we believe that EBITDA, along with cash flow from operating activities, investing activities and financing activities, provides investors with an additional indicator of its ability to incur and service debt. EBITDA should not be considered as an alternative to net income (determined in accordance with GAAP), as an indication of our financial performance, as an alternative to net cash flows from operating activities (determined in accordance with GAAP), or as a measure of its liquidity.

Page 22