4. Vornado Capital Partners, L.P. and Vornado Capital Partners Parallel, L.P. (the “Fund”)

We are the general partner and investment manager of an $800,000,000 real estate investment Fund, to which we have committed $200,000,000. The Fund has a term of eight years and is our exclusive investment vehicle during its three-year investment period, which concludes in July 2013, for all investments that fit within the Fund's investment parameters, as defined. The Fund is accounted for under the AICPA Audit and Accounting Guide for Investment Companies and its investments are reported on its balance sheet at fair value, with changes in value each period recognized in earnings. We consolidate the accounts of the Fund into our consolidated financial statements.

From inception through September 30, 2011, the Fund received aggregate capital contributions from partners of $256,100,000, including $64,031,000 from us, and as of September 30, 2011, has five investments with an aggregate fair value of approximately $261,417,000. Below is a summary of income (loss) from the Fund for the three and nine months ended September 30, 2011 and 2010.

		For the Three Months				For the Nine Months
(Amounts in thousands)		Ended September 30,				Ended September 30,
		2011		2010		2011		2010
Operating (loss) income		$	(286)	$	(1,410)	$	3,197	$	(1,410)
Net realized gains			-		-		3,085		-
Net unrealized gains			5,639		-		19,209		-
Income (loss) from Real Estate Fund			5,353		(1,410)		25,491		(1,410)
Less:
	(Income) loss attributable to noncontrolling interests		(3,675)		1,091		(15,703)		1,091
Income (loss) from Real Estate Fund attributable to Vornado ⁽¹⁾		$	1,678	$	(319)	$	9,788	$	(319)

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(1)	Excludes $378 and $1,803 of management, leasing and development fees in the three and nine months ended September 30, 2011, respectively, which are included as a component of "fee and other income" on our consolidated statements of income.

On March 1, 2011, we as a co-investor, together with the Fund, acquired a 95% interest in One Park Avenue, a 932,000 square foot office building located between 32nd and 33rd Streets in New York, for $374,000,000. The purchase price consisted of $137,000,000 in cash and 95% of a new $250,000,000 five-year mortgage that bears interest at 5.0%. The Fund accounts for its 64.7% interest in the property at fair value in accordance with the AICPA Audit and Accounting Guide for Investment Companies. We account for our directly owned 30.3% equity interest under the equity method of accounting.