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Investments in Unconsolidated Joint Ventures | 6 Months Ended
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Jun. 30, 2025
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 June 30, 2025, the book value of these investments was $2.7 billion, net of investments with negative book values totaling $172.6 million for which we have an implicit commitment to fund future capital needs. As of June 30, 2025 and 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. Our net equity investment in these VIEs was $256.3 million and $263.8 million as of June 30, 2025 and December 31, 2024, respectively. 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 June 30, 2025:
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 |  | 60.01% | 1,657,198 |
Worldwide Plaza (2) | 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) | Israeli Institutional Investor |  | 95.00% | 369,000 |
115 Spring Street (2) | Private Investor |  | 51.00% | 5,218 |
15 Beekman (5) | A fund managed by Meritz Alternative Investment Management |  | 20.00% | 221,884 |
One Madison Avenue (6) | 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 (7) | Korean Institutional Investor / Israeli Institutional Investor |  | 25.10% | 337,000 |
245 Park Avenue | U.S. Affiliate of Mori Trust Co., Ltd |  | 50.10% | 1,782,793 |
625 Madison Avenue (8) | Private Investor |  | 90.93% | 563,000 |
(1)Economic interest represent the Company's interests in the joint venture as of June 30, 2025. Changes in ownership or 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. (4)The joint venture owns a long-term leasehold interest in the retail space at 650 Fifth Avenue. (5)In 2020, the Company formed a joint venture, which then entered into a long-term sublease with the Company. (6)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 Topic 860, Transfers and Servicing ("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 June 30, 2025 and December 31, 2024. (7)The 25.1% economic interest reflected in this table is net of 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. (8)In connection with the sale of the fee ownership in the property, 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. In June 2025, pursuant to the sale of 50% of the investment, the Company recorded a charge of $14.5 million, which is included in "Equity in net (loss) income from unconsolidated joint ventures" in the consolidated statements of operations. The Company's share of the investment, net of unamortized discounts and loan loss reserves, is $209.7 million with an aggregate weighted average current yield of 8.76% as of June 30, 2025. Disposition of Joint Venture Interests or Properties The following table summarizes the investments in unconsolidated joint ventures sold during the six months ended June 30, 2025.
Property |  | Ownership Interest Sold |  | Disposition Date |  | Gross Asset Valuation (in millions) |  | Loss on Sale (in millions) (1) (2)
85 Fifth Avenue |  | 36.27% |  | April 2025 |  | $ | 46.8 |  |  | $ | (1.9) |
(1)Represents the Company's share of the loss. (2)For the six months ended June 30, 2025, the loss on sale is net of $2.0 million of employee compensation recognized in connection with the investment disposition. Amounts do not include adjustments for expenses recorded in subsequent periods. Acquisition of Joint Venture Interests or Properties We did not acquire any investments in unconsolidated joint ventures during the six months ended June 30, 2025. 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 June 30, 2025 and December 31, 2024, respectively, are as follows (dollars in thousands):
|  |  |  |  |  |  |  | Principal Outstanding |  | Principal Outstanding
| Economic | Current Maturity | Final Maturity |  | Interest |  | June 30, 2025 |  | December 31, 2024
Property | Interest (1) | Date | Date (2) |  | Rate (3) |  | Gross |  | SLG Share |  | Gross |  | SLG Share
Fixed Rate Debt: |  |  |  |  |  |  |  |  |  |  |  |  |  |
650 Fifth Avenue ⁽⁴⁾ | 50.00 | % | July 2025 ⁽⁵⁾ | July 2025 ⁽⁵⁾ |  |  | 5.45% |  | $ | 65,000 |  |  | $ | 32,500 |  |  | $ | 65,000 |  |  | $ | 32,500 |
115 Spring Street ⁽⁴⁾ | 51.00 | % | August 2025 | August 2025 |  |  | 5.50% |  | 65,550 |  |  | 33,431 |  |  | 65,550 |  |  | 33,431 |
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 |  |  | 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% |  | 730,017 |  |  | 415,154 |  |  | 740,947 |  |  | 421,369 |
919 Third Avenue | 51.00 | % | April 2026 | April 2028 |  |  | 6.11% |  | 500,000 |  |  | 255,000 |  |  | 500,000 |  |  | 255,000 |
450 Park Avenue | 25.10 | % | June 2026 | June 2027 |  |  | 6.10% |  | 289,257 |  |  | 72,603 |  |  | 284,835 |  |  | 71,494 |
280 Park Avenue | 50.00 | % | September 2026 | September 2028 |  |  | 5.84% |  | 1,075,000 |  |  | 537,500 |  |  | 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% |  | 656,679 |  |  | 167,453 |  |  | 658,357 |  |  | 167,881 |
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 |  |  | 496,412 |  |  | 253,170 |
One Vanderbilt Avenue | 60.01 | % | July 2031 | July 2031 |  |  | 2.95% |  | 3,000,000 |  |  | 1,800,300 |  |  | 3,000,000 |  |  | 1,800,300 |
Total fixed rate debt |  |  |  |  |  |  | $ | 11,542,915 |  |  | $ | 5,723,399 |  |  | $ | 11,551,101 |  |  | $ | 5,728,933 |
Floating Rate Debt: |  |  |  |  |  |  |  |  |  |  |  |  |  |
11 West 34th Street ⁽⁴⁾ | 30.00 | % | February 2023 ⁽⁷⁾ | February 2023 ⁽⁷⁾ |  | L+ | 1.45% |  | $ | 23,000 |  |  | $ | 6,900 |  |  | $ | 23,000 |  |  | $ | 6,900 |
1552 Broadway ⁽⁴⁾ | 50.00 | % | February 2024 ⁽⁸⁾ | February 2024 ⁽⁸⁾ |  | S+ | 2.75% |  | 193,132 |  |  | 96,566 |  |  | 193,132 |  |  | 96,566 |
650 Fifth Avenue ⁽⁴⁾ | 50.00 | % | July 2025 ⁽⁵⁾ | July 2025 ⁽⁵⁾ |  | S+ | 2.25% |  | 210,000 |  |  | 105,000 |  |  | 210,000 |  |  | 105,000 |
One Madison Avenue ⁽⁶⁾ | 25.50 | % | November 2027 | November 2027 |  | S+ | 3.10% |  | 437,518 |  |  | 111,567 |  |  | 354,757 |  |  | 90,463 |
Total floating rate debt |  |  |  |  |  | $ | 863,650 |  |  | $ | 320,033 |  |  | $ | 780,889 |  |  | $ | 298,929 |
Total joint venture mortgages and other loans payable |  |  |  |  |  | $ | 12,406,565 |  |  | $ | 6,043,432 |  |  | $ | 12,331,990 |  |  | $ | 6,027,862 |
Deferred financing costs, net |  |  |  |  |  | (87,590) |  |  | (43,647) |  |  | (97,729) |  |  | (49,058) |
Total joint venture mortgages and other loans payable, net |  |  |  |  |  | $ | 12,318,975 |  |  | $ | 5,999,785 |  |  | $ | 12,234,261 |  |  | $ | 5,978,804 |
(1)Economic interest represents the Company's interests in the joint venture as of June 30, 2025. 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 June 30, 2025, 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)The Company is in discussions with the lender on resolution of the past maturity. (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)The Company's joint venture partner is in discussions with the lender on resolution of the past maturity. (8)During the three months ended June 30, 2025, an affiliate of the Company and a joint venture partner acquired the outstanding mortgage loan at 1552 Broadway that was in maturity default for $63.0 million, of which our share was $31.5 million. An initial allowance of $132.0 million was established, of which our share was $66.0 million. This investment is included in "Investment in unconsolidated joint ventures" in our consolidated balance sheets. We receive fees for providing management, leasing, construction supervision and asset management services to certain of our joint ventures. We recognized $2.9 million and $5.5 million from these services, net of our ownership share of the joint ventures, for the three and six months ended June 30, 2025, respectively. We recognized $2.8 million and $6.5 million from these services, net of our ownership share of the joint ventures, for the three and six months ended June 30, 2024, 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, at June 30, 2025 and December 31, 2024 are as follows (in thousands):
| June 30, 2025 |  | December 31, 2024
Assets (1) |  |  |
Commercial real estate property, net | $ | 15,257,048 |  |  | $ | 15,327,542 |
Cash and restricted cash | 569,042 |  |  | 649,426 |
Tenant and other receivables, related party receivables, and deferred rents receivable | 702,422 |  |  | 621,748 |
Debt and preferred equity investments, net | 246,057 |  |  | 236,512 |
Right-of-use assets | 907,583 |  |  | 919,658 |
Other assets | 1,638,957 |  |  | 1,739,549 |
Total assets | $ | 19,321,109 |  |  | $ | 19,494,435 |
Liabilities and equity (1) |  |  |
Mortgages and other loans payable, net | $ | 12,318,975 |  |  | $ | 12,234,261 |
Deferred revenue | 897,575 |  |  | 956,217 |
Lease liabilities | 1,001,482 |  |  | 1,008,085 |
Other liabilities | 422,585 |  |  | 519,582 |
Equity | 4,680,492 |  |  | 4,776,290 |
Total liabilities and equity | $ | 19,321,109 |  |  | $ | 19,494,435 |
Company's investments in unconsolidated joint ventures | $ | 2,701,382 |  |  | $ | 2,690,138 |
(1)At June 30, 2025, $477.0 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 three and six months ended June 30, 2025 and 2024, are as follows (in thousands):
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Total revenues | $ | 382,176 |  |  | $ | 365,007 |  |  | $ | 754,102 |  |  | $ | 730,346 |
Operating expenses | 63,197 |  |  | 59,733 |  |  | 131,212 |  |  | 125,483 |
Real estate taxes | 71,658 |  |  | 73,479 |  |  | 143,162 |  |  | 149,111 |
Operating lease rent | 5,942 |  |  | 8,478 |  |  | 12,523 |  |  | 17,503 |
Loan loss and other investment reserves, net of recoveries | 1,438 |  |  | — |  |  | 1,438 |  |  | — |
Interest expense, net of interest income | 130,336 |  |  | 142,196 |  |  | 259,232 |  |  | 292,050 |
Amortization of deferred financing costs | 5,878 |  |  | 4,159 |  |  | 11,897 |  |  | 10,231 |
Depreciation and amortization | 125,535 |  |  | 135,611 |  |  | 246,840 |  |  | 269,789 |
Total expenses | 403,984 |  |  | 423,656 |  |  | 806,304 |  |  | 864,167 |
Gain on early extinguishment of debt | — |  |  | 61,185 |  |  | — |  |  | 233,704 |
Net (loss) income before gain on sale | $ | (21,808) |  |  | $ | 2,536 |  |  | $ | (52,202) |  |  | $ | 99,883 |
Company's equity in net (loss) income from unconsolidated joint ventures | $ | (22,775) |  |  | $ | 4,325 |  |  | $ | (21,605) |  |  | $ | 115,485 |

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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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