Redeemable Noncontrolling Interests

12 Months Ended

Dec. 31, 2012

Redeemable Noncontrolling Interests [Abstract]

11. Redeemable Noncontrolling Interests

Redeemable noncontrolling interests on our consolidated balance sheets represent Operating Partnership units held by third parties and are comprised of Class A units and Series D-15 and D-16 cumulative redeemable preferred units. Class A units may be tendered for redemption to the Operating Partnership for cash; we, at our option, may assume that obligation and pay the holder either cash or Vornado common shares on a one-for-one basis. Because the number of Vornado common shares outstanding at all times equals the number of Class A units owned by Vornado, the redemption value of each Class A unit is equivalent to the market value of one Vornado common share, and the quarterly distribution to a Class A unitholder is equal to the quarterly dividend paid to a Vornado common shareholder. Below are the details of Operating Partnership units held by third-parties that are included in “redeemable noncontrolling interests” as of December 31, 2012 and 2011.


(Amounts in thousands, except units and										Preferred or
per unit amounts)		Balance as of				Units Outstanding at		Per Unit		Annual
		December 31,				December 31,		Liquidation		Distribution
Unit Series		2012			2011	2012	2011	Preference		Rate
Common:
	Class A	$	898,152	$	934,677	11,215,682	12,160,771		N/A	$	2.76

Perpetual Preferred: ⁽¹⁾
	6.875% D-15 Cumulative Redeemable	$	45,000	$	45,000	1,800,000	1,800,000	$	25.00	$	1.71875
	5.00% D-16 Cumulative Redeemable		1,000		1,000	1	1	$	1,000,000.00	$	50,000.00
	7.00% D-10 Cumulative Redeemable⁽²⁾		-		80,000	-	3,200,000	$	25.00	$	1.75
	6.75% D-14 Cumulative Redeemable⁽²⁾		-		100,000	-	4,000,000	$	25.00	$	1.6875
		$	46,000	$	226,000	1,800,001	9,000,001


(1)	Holders may tender units for redemption to the Operating Partnership for cash at their stated redemption amount; we, at our option, may assume that obligation and pay the holders either cash or Vornado preferred shares on a one-for-one basis. These units are redeemable at our option at any time.
(2)	On July 19, 2012, we redeemed all of the outstanding 7.0% Series D-10 and 6.75% Series D-14 cumulative redeemable preferred units with an aggregate face amount of $180,000 for $168,300 in cash, plus accrued and unpaid distributions through the date of redemption.

11. Redeemable Noncontrolling Interests - continued

Redeemable noncontrolling interests on our consolidated balance sheets are recorded at the greater of their carrying amount or redemption value at the end of each reporting period. Changes in the value from period to period are charged to “additional capital” in our consolidated statements of changes in equity. Below is a table summarizing the activity of redeemable noncontrolling interests.

(Amounts in thousands)
Balance at December 31, 2010	$	1,327,974
Net income		55,912
Distributions		(50,865)
Conversion of Class A units into common shares, at redemption value		(64,830)
Adjustment to carry redeemable Class A units at redemption value		(98,092)
Redemption of Series D-11 redeemable units		(28,000)
Other, net		18,578
Balance at December 31, 2011		1,160,677
Net income		45,263
Distributions		(54,315)
Conversion of Class A units into common shares, at redemption value		(89,762)
Adjustment to carry redeemable Class A units at redemption value		52,117
Redemption of Series D-10 and Series D-14 redeemable units		(168,300)
Other, net		(1,528)
Balance at December 31, 2012	$	944,152

Redeemable noncontrolling interests exclude our Series G convertible preferred units and Series D-13 cumulative redeemable preferred units, as they are accounted for as liabilities in accordance with ASC 480, Distinguishing Liabilities and Equity, because of their possible settlement by issuing a variable number of Vornado common shares. Accordingly, the fair value of these units is included as a component of “other liabilities” on our consolidated balance sheets and aggregated $55,011,000 and $54,865,000 as of December 31, 2012 and 2011, respectively.