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Investments in Unconsolidated Joint Ventures | 12 Months Ended
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Dec. 31, 2024
Equity Method Investments and Joint Ventures [Abstract] |
Investments in Unconsolidated Joint Ventures | Investments in Unconsolidated Joint Ventures We have investments in several real estate joint ventures with various third-party partners. As of December 31, 2024, the book value of these investments was $2.7 billion, net of investments with negative book values totaling $150.5 million for which we have an implicit commitment to fund future capital needs. As of December 31, 2024, 800 Third Avenue and our preferred equity investment in 625 Madison Avenue are VIEs in which we are not the primary beneficiary. As of December 31, 2023, 800 Third Avenue and 625 Madison Avenue were VIEs in which we are not the primary beneficiary. Our net equity investment in these VIEs was $263.8 million as of December 31, 2024, and $437.9 million as of December 31, 2023. Our maximum loss is limited to the amount of our equity investment in these VIEs. See the "Principles of Consolidation" section of Note 2, "Significant Accounting Policies." All other investments below are voting interest entities. As we have the ability to exercise significant influence over, but do not control, the joint ventures listed below, we account for them under the equity method of accounting. The table below provides general information on each of our joint ventures as of December 31, 2024:
Property | Partner |  | Economic Interest (1) | Unaudited Approximate Square Feet
800 Third Avenue | Private Investors |  | 60.52% | 526,000 |
919 Third Avenue | New York State Teacher's Retirement System |  | 51.00% | 1,454,000 |
11 West 34th Street (2) | Private Investor / Wharton Properties |  | 30.00% | 17,150 |
280 Park Avenue | Vornado Realty Trust |  | 50.00% | 1,219,158 |
1552-1560 Broadway (2) (3) | Wharton Properties |  | 50.00% | 57,718 |
650 Fifth Avenue (2) (4) | Wharton Properties |  | 50.00% | 69,214 |
11 Madison Avenue | PGIM Real Estate |  | 60.00% | 2,314,000 |
One Vanderbilt Avenue (5) | National Pension Service of Korea / Hines Interest LP / Mori Building Co., Ltd |  | 60.01% | 1,657,198 |
Worldwide Plaza (2) (6) | RXR Realty / New York REIT |  | 24.95% | 2,048,725 |
1515 Broadway | Allianz Real Estate of America |  | 56.87% | 1,750,000 |
2 Herald Square (2) (7) (8) | Israeli Institutional Investor |  | 95.00% | 369,000 |
115 Spring Street (2) (9) | Private Investor |  | 51.00% | 5,218 |
15 Beekman (10) | A fund managed by Meritz Alternative Investment Management |  | 20.00% | 221,884 |
85 Fifth Avenue (11) | Wells Fargo |  | 36.27% | 12,946 |
One Madison Avenue (12) | National Pension Service of Korea / Hines Interest LP / International Investor |  | 25.50% | 1,048,700 |
220 East 42nd Street | A fund managed by Meritz Alternative Investment Management |  | 51.00% | 1,135,000 |
450 Park Avenue (13) | Korean Institutional Investor / Israeli Institutional Investor |  | 25.10% | 337,000 |
245 Park Avenue (14) | U.S. Affiliate of Mori Trust Co., Ltd |  | 50.10% | 1,782,793 |
625 Madison Avenue (15) | Private Investor |  | 90.93% | 563,000 |
(1)Economic interest represent the Company's interests in the joint venture as of December 31, 2024. Changes in economic interests within the current year are disclosed in the notes below. (2)Included in the Company's alternative strategy portfolio. (3)The joint venture owns a long-term leasehold interest in the retail space and certain other spaces at 1560 Broadway, which is adjacent to 1552 Broadway. In December 2023, following an assessment of the investment for recoverability, the Company recorded a charge of $8.1 million, which is included in Depreciable real estate reserves and impairments in the consolidated statements of operations. (4)The joint venture owns a long-term leasehold interest in the retail space at 650 Fifth Avenue. (5)In November 2024, the Company sold an additional 11% interest in the joint venture. The Company retained a 60.01% ownership interest in the investment and recognized a $187.6 million gain in Equity in net gain (loss) on sale of interest in unconsolidated joint venture/real estate. (6)In December 2024, following an assessment of the investment for recoverability, the Company recorded a charge of $72.6 million, which is included in Equity in net loss from unconsolidated joint ventures in the consolidated statements of operations. (7)In December 2023, following an assessment of the property and the investment for recoverability, the Company recorded a charge of $101.7 million, which is included in Depreciable real estate reserves and impairments in the consolidated statements of operations. In January 2024, the Company closed on the acquisition of interests in the joint venture that owns the leasehold interest for no consideration, which increases the Company's interest in the joint venture to 95.0%. In addition, in February 2024, the joint venture settled the previously existing $182.5 million mortgage on the property for a net payment of $7.0 million. (8)In December 2024, following an assessment of the investment for recoverability, the Company recorded a charge of $20.4 million, which is included in Equity in net loss from unconsolidated joint ventures in the consolidated statements of operations. (9)In December 2024, following an assessment of the property for recoverability, the Company recognized a charge of $11.7 million, which is included in Equity in net loss from unconsolidated joint ventures in the consolidated statements of operations. (10)In 2020, the Company formed a joint venture, which then entered into a long-term sublease with the Company. (11)In December 2024, following an assessment of the property and investment for recoverability, the Company recorded a charge of $12.0 million, which is included in Equity in net loss from unconsolidated joint ventures in the consolidated statements of operations. (12)In 2021, the Company admitted an additional partner to the development project with the partner's indirect ownership in the joint venture totaling 25.0%. The transaction did not meet sale accounting under ASC 860 and, as a result, was treated as a secured borrowing for accounting purposes and is included in Other liabilities in our consolidated balance sheets at December 31, 2024 and 2023. (13)The 25.1% economic interest reflected in this table excludes a 25.0% economic interest held by a third party. The third-party's economic interest is held in a joint venture that we consolidate as a 50.1% ownership interest. The third-party's 25.0% economic interest is recognized in Noncontrolling interests in other partnerships on our consolidated balance sheet. A separate third-party owns the remaining 49.9% economic interest in the property. (14)In June 2023, the Company sold a 49.9% interest, which resulted in the Company no longer retaining a controlling interest in the entity, as defined in ASC 810, and deconsolidation of the 50.1% interest we retained. We recorded our investment at fair value which resulted in the recognition of a fair value adjustment of ($17.0 million) during the year ended December 31, 2023. The fair value of our investment was determined by the terms of the joint venture agreement. (15)In September 2023, following a UCC foreclosure, the Company converted its previous mezzanine debt investments in the fee interest to a 90.43% ownership interest. See Note 5, "Debt and Preferred Equity Investments." In December 2023, together with its joint venture partner, the Company entered into a contract to sell the fee ownership in the property. In connection with this contract, the Company recorded a charge of $23.1 million, which is included in Depreciable real estate reserves and impairments in the consolidated statements of operations. In connection with the sale, which closed in May 2024, the Company, together with its joint venture partner, originated a $235.4 million preferred equity investment in the property with a mandatory redemption date of December 2026. The Company's share, net of unamortized discounts, is $214.7 million with an aggregate weighted average current yield of 8.86% as of December 31, 2024. Disposition of Joint Venture Interests or Properties The following table summarizes the investments in unconsolidated joint ventures sold during the years ended December 31, 2024, 2023, and 2022:
Property |  | Ownership Interest Sold |  | Disposition Date |  | Gross Asset Valuation (in millions) |  | Gain (Loss) on Sale (in millions) (1) (2)
One Vanderbilt Avenue |  | 11.00% |  | November 2024 |  | $ | 4,700.0 |  |  | $ | 187.6 |
625 Madison Avenue (3) |  | 90.43% |  | May 2024 |  | 634.6 |  |  | (7.6) |
717 Fifth Avenue |  | 10.92% |  | January 2024 |  | 963.0 |  |  | 26.9 |
21 East 66th Street |  | 32.28% |  | December 2023 |  | 40.6 |  |  | (12.7) |
121 Greene Street |  | 50.00% |  | February 2023 |  | 14.0 |  |  | (0.3) |
Stonehenge Portfolio |  | Various |  | April 2022 |  | 1.0 |  |  | — |
(1)Represents the Company's share of the gain or loss (2)For the years ended December 31, 2024 and December 31, 2023, the (losses) gains on sale are net of $16.8 million and $2.0 million, respectively, of employee compensation accrued in connection with the realization of the investment dispositions. There was no amount accrued for employee compensation in the year ended December 31, 2022. Additionally, amounts do not include adjustments for expenses recorded in subsequent periods. (3)In connection with the sale of the fee ownership interest, the Company, together with its joint venture partner, originated a $235.4 million preferred equity investment in the property with a mandatory redemption date of December 2026. The Company's share, net of unamortized discounts, is $214.7 million with an aggregate weighted average current yield of 8.86% as of December 31, 2024. Prior to the completion of the sale, the Company recorded a charge of $5.9 million for capital contributions required during the three months ended March 31, 2024 while the investment was under contract, which is included in Depreciable real estate reserves and impairments in the consolidated statements of operations Joint Venture Mortgages and Other Loans Payable We generally finance our joint ventures with non-recourse debt. In certain cases we may provide guarantees or master leases, which terminate upon the satisfaction of specified circumstances or repayment of the underlying loans. The mortgage notes and other loans payable collateralized by the respective joint venture properties and assignment of leases as of December 31, 2024 and 2023, respectively, are as follows (dollars in thousands):
|  |  |  |  |  |  |  |  |  | Principal Outstanding |  | Principal Outstanding
|  | Economic |  | Current Maturity | Final Maturity |  | Interest |  | December 31, 2024 |  | December 31, 2023
Property |  | Interest (1) |  | Date | Date (2) |  | Rate (3) |  | Gross |  | SLG Share |  | Gross |  | SLG Share
Fixed Rate Debt: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
650 Fifth Avenue (4) |  | 50.00 | % |  | February 2025 (5) | July 2025 |  |  | 5.45% |  | $ | 65,000 |  |  | $ | 32,500 |  |  | $ | 65,000 |  |  | $ | 32,500 |
115 Spring Street (4) |  | 51.00 | % |  | March 2025 | March 2025 |  |  | 5.50% |  | 65,550 |  |  | 33,431 |  |  | 65,550 |  |  | 33,431 |
450 Park Avenue |  | 25.10 | % |  | June 2025 | June 2027 |  |  | 6.10% |  | 284,835 |  |  | 71,494 |  |  | 271,394 |  |  | 68,120 |
11 Madison Avenue |  | 60.00 | % |  | September 2025 | September 2025 |  |  | 3.84% |  | 1,400,000 |  |  | 840,000 |  |  | 1,400,000 |  |  | 840,000 |
15 Beekman |  | 20.00 | % |  | January 2026 | January 2028 |  |  | 5.99% |  | 120,000 |  |  | 24,000 |  |  | — |  |  | — |
800 Third Avenue |  | 60.52 | % |  | February 2026 | February 2026 |  |  | 3.37% |  | 177,000 |  |  | 107,120 |  |  | 177,000 |  |  | 107,120 |
1515 Broadway |  | 56.87 | % |  | March 2026 | March 2028 |  |  | 3.93% |  | 740,947 |  |  | 421,369 |  |  | 762,002 |  |  | 433,344 |
919 Third Avenue |  | 51.00 | % |  | April 2026 | April 2028 |  |  | 6.11% |  | 500,000 |  |  | 255,000 |  |  | 500,000 |  |  | 255,000 |
280 Park Avenue |  | 50.00 | % |  | September 2026 | September 2028 |  |  | 5.84% |  | 1,075,000 |  |  | 537,500 |  |  | — |  |  | — |
245 Park Avenue |  | 50.10 | % |  | June 2027 | June 2027 |  |  | 4.30% |  | 1,768,000 |  |  | 885,768 |  |  | 1,768,000 |  |  | 885,768 |
One Madison Avenue (6) |  | 25.50 | % |  | November 2027 | November 2027 |  |  | 7.10% |  | 658,357 |  |  | 167,881 |  |  | 733,103 |  |  | 186,941 |
Worldwide Plaza (4) |  | 24.95 | % |  | November 2027 | November 2027 |  |  | 3.98% |  | 1,200,000 |  |  | 299,400 |  |  | 1,200,000 |  |  | 299,400 |
220 East 42nd Street |  | 51.00 | % |  | December 2027 | December 2027 |  |  | 6.77% |  | 496,412 |  |  | 253,170 |  |  | 505,412 |  |  | 257,760 |
One Vanderbilt Avenue |  | 60.01 | % |  | July 2031 | July 2031 |  |  | 2.95% |  | 3,000,000 |  |  | 1,800,300 |  |  | 3,000,000 |  |  | 2,130,300 |
5 Times Square (7) |  |  |  |  |  |  |  |  |  | — |  |  | — |  |  | 477,783 |  |  | 150,740 |
625 Madison Avenue |  |  |  |  |  |  |  |  |  | — |  |  | — |  |  | 199,987 |  |  | 180,848 |
10 East 53rd Street |  |  |  |  |  |  |  |  |  | — |  |  | — |  |  | 220,000 |  |  | 121,000 |
717 Fifth Avenue |  |  |  |  |  |  |  |  |  | — |  |  | — |  |  | 655,328 |  |  | 71,536 |
Total fixed rate debt |  |  |  |  |  |  |  | $ | 11,551,101 |  |  | $ | 5,728,933 |  |  | $ | 12,000,559 |  |  | $ | 6,053,808 |
Floating Rate Debt: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
11 West 34th Street (4) |  | 30.00 | % |  | February 2023 (8) | February 2023 (8) |  | L+ | 1.45% |  | $ | 23,000 |  |  | $ | 6,900 |  |  | $ | 23,000 |  |  | $ | 6,900 |
1552 Broadway (4) |  | 50.00 | % |  | February 2024 (9) | February 2024 (9) |  | S+ | 2.75% |  | 193,132 |  |  | 96,566 |  |  | 193,133 |  |  | 96,567 |
650 Fifth Avenue (4) |  | 50.00 | % |  | February 2025 (5) | July 2025 |  | S+ | 2.25% |  | 210,000 |  |  | 105,000 |  |  | 210,000 |  |  | 105,000 |
One Madison Avenue (6) |  | 25.50 | % |  | November 2027 | November 2027 |  | S+ | 3.10% |  | 354,757 |  |  | 90,463 |  |  | — |  |  | — |
100 Park Avenue |  |  |  |  |  |  |  |  |  | — |  |  | — |  |  | 360,000 |  |  | 179,640 |
5 Times Square (7) |  |  |  |  |  |  |  |  |  | — |  |  | — |  |  | 610,010 |  |  | 192,458 |
280 Park Avenue |  |  |  |  |  |  |  |  |  | — |  |  | — |  |  | 1,200,000 |  |  | 600,000 |
2 Herald Square |  |  |  |  |  |  |  |  |  | — |  |  | — |  |  | 182,500 |  |  | 93,075 |
15 Beekman |  |  |  |  |  |  |  |  |  | — |  |  | — |  |  | 124,137 |  |  | 24,827 |
Total floating rate debt |  |  |  |  |  |  |  | $ | 780,889 |  |  | $ | 298,929 |  |  | $ | 2,902,780 |  |  | $ | 1,298,467 |
Total joint venture mortgages and other loans payable |  |  |  |  | $ | 12,331,990 |  |  | $ | 6,027,862 |  |  | $ | 14,903,339 |  |  | $ | 7,352,275 |
Deferred financing costs, net |  |  |  |  | (97,729) |  |  | (49,058) |  |  | (104,062) |  |  | (54,865) |
Total joint venture mortgages and other loans payable, net |  |  |  |  | $ | 12,234,261 |  |  | $ | 5,978,804 |  |  | $ | 14,799,277 |  |  | $ | 7,297,410 |
(1)Economic interest represents the Company's interests in the joint venture as of December 31, 2024. Changes in ownership or economic interests, if any, within the current year are disclosed in the notes to the investment in unconsolidated joint ventures table above. (2)Reflects exercise of all available extension options. The ability to exercise extension options may be subject to certain conditions, including the operating performance of the property. (3)Interest rates as of December 31, 2024, taking into account interest rate hedges at the joint venture. Corporate interest rate hedges are not taken into consideration. Floating rate debt is presented with the stated spread over Term SOFR ("S"). (4)Included in the Company's alternative strategy portfolio. (5)In February 2025, the maturity date of the loan was extended to July 2025. (6)The loan is a $1.25 billion construction facility, which was fully extended to November 2027. Advances under the loan are subject to costs incurred. In conjunction with the loan, the Company provided partial guarantees for interest and principal payments, the amounts of which are based on certain construction milestones and operating metrics. (7)In the fourth quarter of 2024, the Company recorded a $146.4 million charge, which is included in Equity in net loss from unconsolidated joint ventures. The Company no longer has an ownership interest in the property. (8)The Company's joint venture partner is in discussions with the lender on resolution of the past maturity. (9)The Company is in discussions with the lender on resolution of the past maturity. We are entitled to receive fees for providing management, leasing, construction supervision and asset management services to certain of our joint ventures. We earned $21.9 million, $21.1 million and $24.0 million from these services, net of our ownership share of the joint ventures, for the years ended December 31, 2024, 2023, and 2022, respectively. In addition, we have the ability to earn incentive fees based on the ultimate financial performance of certain of the joint venture properties. The combined balance sheets for the unconsolidated joint ventures, as of December 31, 2024 and 2023, are as follows (in thousands):
| December 31, 2024 |  | December 31, 2023
Assets (1) |  |  |
Commercial real estate property, net | $ | 15,327,542 |  |  | $ | 17,561,406 |
Cash and restricted cash | 649,426 |  |  | 656,038 |
Tenant and other receivables, related party receivables, and deferred rents receivable | 621,748 |  |  | 673,532 |
Debt and preferred equity investments, net | 236,512 |  |  | — |
Right-of-use assets | 919,658 |  |  | 905,934 |
Other assets | 1,739,549 |  |  | 2,584,765 |
Total assets | $ | 19,494,435 |  |  | $ | 22,381,675 |
Liabilities and equity (1) |  |  |
Mortgages and other loans payable, net | $ | 12,234,261 |  |  | $ | 14,799,277 |
Deferred revenue | 956,217 |  |  | 1,108,180 |
Lease liabilities | 1,008,085 |  |  | 990,276 |
Other liabilities | 519,582 |  |  | 447,705 |
Equity | 4,776,290 |  |  | 5,036,237 |
Total liabilities and equity | $ | 19,494,435 |  |  | $ | 22,381,675 |
Company's investments in unconsolidated joint ventures | $ | 2,690,138 |  |  | $ | 2,983,313 |
(1)As of December 31, 2024, $480.8 million of net unamortized basis differences between the amount at which our investments are carried and our share of equity in net assets of the underlying property will be amortized through equity in net income (loss) from unconsolidated joint ventures over the remaining life of the underlying items having given rise to the differences. The combined statements of operations for the unconsolidated joint ventures, from acquisition date through the years ended December 31, 2024, 2023, and 2022 are as follows (unaudited, in thousands):
| Year Ended December 31,
| 2024 |  | 2023 |  | 2022
Total revenues | $ | 1,484,459 |  |  | $ | 1,525,044 |  |  | $ | 1,339,364 |
Operating expenses | 259,558 |  |  | 253,630 |  |  | 240,002 |
Real estate taxes | 297,520 |  |  | 287,462 |  |  | 252,806 |
Operating lease rent | 33,207 |  |  | 29,048 |  |  | 26,152 |
Interest expense, net of interest income | 573,148 |  |  | 574,032 |  |  | 431,865 |
Amortization of deferred financing costs | 21,289 |  |  | 28,157 |  |  | 27,754 |
Depreciation and amortization | 538,390 |  |  | 516,466 |  |  | 465,100 |
Total expenses | $ | 1,723,112 |  |  | $ | 1,688,795 |  |  | $ | 1,443,679 |
Gain (loss) on early extinguishment of debt | 233,704 |  |  | — |  |  | (467) |
Depreciable real estate reserves and impairments | (181,798) |  |  | — |  |  | — |
Net loss before gain (loss) on sale | $ | (186,747) |  |  | $ | (163,751) |  |  | $ | (104,782) |
Company's equity in net loss from unconsolidated joint ventures | $ | (179,695) |  |  | $ | (76,509) |  |  | $ | (57,958) |

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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://www.xbrl.org/2003/role/recommendedDisclosureRef -Topic 740 -SubTopic 323 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478156/740-323-50-2 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 323 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 3 -Subparagraph (a)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481687/323-10-50-3 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 323 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 3 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481687/323-10-50-3 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Topic 323 -Publisher FASB -URI https://asc.fasb.org/323/tableOfContent + Details
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