Alexander's, Inc. (NYSE: ALX), a real estate investment trust (REIT) managed by Vornado Realty Trust (NYSE: VNO), reported its financial results for the three and nine months ended September 30, 2024. The company operates five properties in New York City, with total real estate at cost amounting to $1.079 billion and net real estate valued at $642.251 million.

For the three months ended September 30, 2024, rental revenues increased to $55.675 million from $55.413 million in the same period of 2023. This growth was attributed to higher straight-line rental revenue from Bloomberg's lease extension and increased lease termination fee income, which offset declines from IKEA's lease expiration. Total expenses for the quarter rose to $35.841 million, up from $35.106 million, primarily due to higher real estate tax expenses. Consequently, net income for the quarter decreased to $6.678 million, or $1.30 per diluted share, compared to $10.754 million, or $2.10 per diluted share, in the prior year.

For the nine months ended September 30, 2024, rental revenues totaled $170.464 million, an increase from $162.027 million in 2023. The increase was driven by higher rental income from IKEA's lease modification and Bloomberg's lease extension. However, net income for the nine-month period fell significantly to $31.167 million, or $6.07 per diluted share, down from $86.127 million, or $16.79 per diluted share, in the previous year, which included a substantial gain from the sale of the Rego Park III land parcel.

Funds from operations (FFO) for the three months ended September 30, 2024, were $14.582 million, or $2.84 per diluted share, compared to $18.623 million, or $3.63 per diluted share, in the same period of 2023. For the nine-month period, FFO increased to $57.123 million, or $11.13 per diluted share, from $55.464 million, or $10.81 per diluted share, in the prior year.

The company reported a significant decrease in liquidity, with cash and cash equivalents and restricted cash totaling $397.176 million as of September 30, 2024, down from $552.977 million at the end of 2023. This decline was primarily due to net cash used in financing activities, which included $500 million in debt repayments and $69.277 million in dividends paid.

In terms of strategic developments, Alexander's extended leases with Bloomberg for approximately 947,000 square feet at 731 Lexington Avenue to February 2040, incurring a leasing commission of $32 million. The company also secured a new $400 million mortgage loan on the office condominium at 731 Lexington Avenue with a fixed interest rate of 5.04%, maturing in October 2028.

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