Leases

12 Months Ended

Dec. 31, 2016

7. LEASES

As Lessor

We lease space to tenants in an office building and in retail centers. The rental terms range from approximately 5 to 25 years. The leases provide for the payment of fixed base rents payable monthly in advance as well as reimbursements of real estate taxes, insurance and maintenance costs. Retail leases may also provide for the payment by the lessee of additional rents based on a percentage of their sales. We also lease residential space at The Alexander apartment tower with one or two year lease terms.

Future base rental revenue under these non-cancelable operating leases is as follows:

(Amounts in thousands)

Year Ending December 31,	Amount
2017	$	145,464
2018		139,371
2019		136,370
2020		134,689
2021		118,062
Thereafter		845,921

These future minimum amounts do not include additional rents based on a percentage of retail tenants’ sales. For the years ended December 31, 2016, 2015, and 2014, these rents were $182,000, $94,000, and $108,000, respectively.

Bloomberg accounted for $104,590,000, $94,468,000 and $91,109,000, representing approximately 46%, 45% and 45% of our total revenues in each of the years ended December 31, 2016, 2015 and 2014, respectively. No other tenant accounted for more than 10% of our total revenues. If we were to lose Bloomberg as a tenant, or if Bloomberg were to be unable to fulfill its obligations under its lease, it would adversely affect our results of operations and financial condition. In order to assist us in our continuing assessment of Bloomberg’s creditworthiness, we receive certain confidential financial information and metrics from Bloomberg. In addition, we access and evaluate financial information regarding Bloomberg from other private sources, as well as publicly available data.

In January 2016, we entered into a lease amendment with Bloomberg which extends the lease term related to 192,000 square feet of office space at our 731 Lexington Avenue property to be coterminous with the other 697,000 square feet of office space leased by Bloomberg through February 2029, with a ten-year extension option. In connection with the lease amendment, Bloomberg provided a $200,000,000 letter of credit, which amount may be reduced in certain circumstances. We may draw on this letter of credit subject to certain terms of the lease amendment, including an event of default by Bloomberg. Upon execution of the lease amendment in January 2016, we paid an $8,916,000 leasing commission of which $7,200,000 was to a third party broker and $1,716,000 was to Vornado.

As Lessee

We are a tenant under a long-term ground lease at our Flushing property, which expires in 2027 and has one 10-year extension option. Future lease payments under this operating lease, excluding the extension option, are as follows:

(Amounts in thousands)

Year Ending December 31,	Amount
2017	$	792
2018		800
2019		800
2020		800
2021		800
Thereafter		4,067

Rent expense was $746,000 in each of the years ended December 31, 2016, 2015 and 2014.