Third Quarter 2009 Results

NET INCOME attributable to common shareholders for the quarter ended September 30, 2009 was $126.3million, or $0.69per diluted share, versus $22.7 million, or $0.14 per diluted share, for the quarter ended September 30, 2008. Net income for the quarters ended September 30, 2009 and 2008 includes $43.3 million and $1.3 million, respectively, of net gains on sale of real estate. In addition, net income for the quarters ended September 30, 2009 and 2008 includes certain items that affect comparability which are listed in the table below. The aggregate of the net gains on sale of real estate and the items in the table below, net of amounts attributable to noncontrolling interests, increased net income attributable to common shareholders for the quarter ended September 30, 2009 by $52.8 million, or $0.29 per diluted share and decreased net income attributable to common shareholders for the quarter ended September 30, 2008 by $32.3 million, or $0.20 per diluted share.

FUNDS FROM OPERATIONS attributable to common shareholders plus assumed conversions ("FFO") for the quarter ended September 30, 2009 was $234.2million, or $1.25 per diluted share, compared to $159.8million, or $0.97 per diluted share, for the quarter ended September 30, 2008. Adjusting FFO for certain items that affect comparability which are listed in the table below, FFO for the quarters ended September 30, 2009 and 2008 was $221.4 million and $193.3 million, or $1.18 and $1.17 per diluted share, respectively.

                                                                                                      For the Three Months Ended September 30, 
 (Amounts in thousands, except per share amounts)                                                     2009              2008                   
                                                                                                                                               
 FFO attributable to common shareholders plus assumed conversions (1)                                 $  234,246     $  159,838                
 Per Share                                                                                            $  1.25        $  0.97                   
                                                                                                                                               
 Items that affect comparability (income) expense:                                                                                             
 Our share of partially owned entities' adjustments:                                                                                           
 Lexington Realty Trust -- impairment losses related to its investment in Concord Debt Holdings LLC   $  14,541      $  7,175                  
 Toys "R" Us -- litigation settlement income                                                             (10,200  )     -                      
 Alexander's:                                                                                                                                  
 Income tax benefit                                                                                      (13,668  )     -                      
 Stock appreciation rights                                                                               -              14,557                 
 Net gains on early extinguishment of debt                                                               (3,407   )     -                      
 Marketable equity securities -- impairment losses                                                       -              11,808                 
 Derivative positions in marketable equity securities                                                    -              3,982                  
 Other, net                                                                                              (1,172   )     (721     )             
                                                                                                         (13,906  )     36,801                 
 Noncontrolling interests' share of above adjustments                                                    1,036          (3,347   )             
 Items that affect comparability, net                                                                 $  (12,870  )  $  33,454                 
 Per share                                                                                            $  (0.07    )  $  0.20                   
                                                                                                                                               
 FFO as adjusted for comparability                                                                    $  221,376     $  193,292                
 Per share                                                                                            $  1.18        $  1.17                   


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(1) See page 4 for a reconciliation of our net income to FFO for the quarters ended September 30, 2009 and 2008.

Nine Months Ended September 30, 2009 Results

NET INCOME attributable to common shareholders for the nine months ended September 30, 2009 was $200.3million, or $1.16per diluted share, versus $529.2 million, or $3.22 per diluted share, for the nine months ended September 30, 2008. Net income for the nine months ended September 30, 2009 and 2008 includes $44.0 million, and $65.9 million, respectively, of net gains on sale of real estate. In addition, net income for the nine months ended September 30, 2009 and 2008 includes certain items that affect comparability which are listed in the table below. The aggregate of the net gains on sale of real estate and the items in the table below, net of amounts attributable to noncontrolling interests, decreased net income attributable to common shareholders for the nine months ended September 30, 2009 by $55.4 million, or $0.32 per diluted share and increased net income attributable to common shareholders for the nine months ended September 30, 2008 by $274.8 million, or $1.67 per diluted share.

FFO for the nine months ended September 30, 2009 was $602.8million, or $3.37 per diluted share, compared to $894.8million, or $5.27 per diluted share, for the nine months ended September 30, 2008.