Related Party Transactions

6 Months Ended

Jun. 30, 2023

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

Vornado

As of June 30, 2023, Vornado owned 32.4% of our outstanding common stock. We are managed by, and our properties are leased and developed by, Vornado, pursuant to the agreements described below, which expire in March of each year and are automatically renewable.

Management and Development Agreements

We pay Vornado an annual management fee equal to the sum of (i) $2,800,000, (ii) 2% of gross revenue from the Rego Park II shopping center, (iii) $0.50 per square foot of the tenant-occupied office and retail space at 731 Lexington Avenue, and (iv) $365,000, escalating at 3% per annum, for managing the common area of 731 Lexington Avenue. Vornado is also entitled to a development fee equal to 6% of development costs, as defined.

Leasing and Other Agreements

Vornado also provides us with leasing services for a fee of 3% of rent for the first ten years of a lease term, 2% of rent for the eleventh through the twentieth year of a lease term, and 1% of rent for the twenty-first through thirtieth year of a lease term, subject to the payment of rents by tenants. In the event third-party real estate brokers are used, the fees to Vornado increase by 1% and Vornado is responsible for the fees to the third-party real estate brokers.

Vornado is also entitled to a commission upon the sale of any of our assets equal to 3% of gross proceeds, as defined, for asset sales less than $50,000,000 and 1% of gross proceeds, as defined, for asset sales of $50,000,000 or more (the “Sales Agreement”). Pursuant to the Sales Agreement, we paid a $711,000 sales commission to Vornado in the second quarter of 2023 related to the sale of the Rego Park III land parcel.

We also have agreements with Building Maintenance Services LLC, a wholly owned subsidiary of Vornado, to supervise (i) cleaning, engineering and security services at our 731 Lexington Avenue property and (ii) security services at our Rego Park I and Rego Park II properties and The Alexander apartment tower.

The following is a summary of fees incurred to Vornado under the various agreements discussed above.

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
(Amounts in thousands)	2023		2022		2023		2022
Company management fees	$	700	$	700	$	1,400	$	1,400
Development fees	—		—		—		3
Leasing fees	129		—		170		1,318
Commission on sale of real estate	711		—		711		—
Property management, cleaning, engineering and security fees	1,550		1,547		2,959		2,816
	$	3,090	$	2,247	$	5,240	$	5,537

As of June 30, 2023, the amounts due to Vornado were $823,000 for management, property management, cleaning, engineering and security fees and $129,000 for leasing fees. As of December 31, 2022, the amounts due to Vornado were $742,000 for management, property management, cleaning, engineering and security fees and $59,000 for leasing fees.