10-Q 1 alx10q1q2012.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark one)

x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

| For the quarterly period ended: | March 31, 2012 |

Or

o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from: |  | to |

Commission File Number: | 001-6064 |

ALEXANDER’S, INC.

(Exact name of registrant as specified in its charter)

Delaware |  | 51-0100517
(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification Number)
210 Route 4 East, Paramus, New Jersey |  | 07652
(Address of principal executive offices) |  | (Zip Code)

(201) 587-8541

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. x Yes o No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). x Yes o No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

x Large Accelerated Filer |  | o Accelerated Filer
o Non-Accelerated Filer (Do not check if smaller reporting company) |  | o Smaller Reporting Company

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). o Yes x No

As of April 30, 2012, there were 5,105,936 shares of common stock, par value $1 per share, outstanding.

| ALEXANDER’S, INC.
| INDEX
|  |  |  |  | Page Number
PART I. | Financial Information |  |
| Item 1. |  | Financial Statements: |  |
|  |  | Consolidated Balance Sheets (Unaudited) as of |  |
|  |  |  | March 31, 2012 and December 31, 2011 | 3 |
|  |  | Consolidated Statements of Income (Unaudited) for the |  |
|  |  |  | Three Months Ended March 31, 2012 and 2011 | 4 |
|  |  | Consolidated Statements of Changes in Equity (Unaudited) for the |  |
|  |  |  | Three Months Ended March 31, 2012 and 2011 | 5 |
|  |  | Consolidated Statements of Cash Flows (Unaudited) for the |  |
|  |  |  | Three Months Ended March 31, 2012 and 2011 | 6 |
|  |  | Notes to Consolidated Financial Statements (Unaudited) | 7 |
|  |  | Report of Independent Registered Public Accounting Firm | 13 |
| Item 2. |  | Management’s Discussion and Analysis of |  |
|  |  |  | Financial Condition and Results of Operations | 14 |
| Item 3. |  | Quantitative and Qualitative Disclosures about Market Risk | 21 |
| Item 4. |  | Controls and Procedures | 21 |
PART II. | Other Information |  |
| Item 1. |  | Legal Proceedings | 22 |
| Item 1A. |  | Risk Factors | 22 |
| Item 2. |  | Unregistered Sales of Equity Securities and Use of Proceeds | 22 |
| Item 3. |  | Defaults Upon Senior Securities | 22 |
| Item 4. |  | Mine Safety Disclosures | 22 |
| Item 5. |  | Other Information | 22 |
| Item 6. |  | Exhibits | 22 |
Signatures |  |  |  | 23 |
Exhibit Index |  |  |  | 24 |

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

ALEXANDER’S, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(Amounts in thousands, except share and per share amounts)
|  |  | March 31, |  | December 31,
ASSETS | 2012 |  | 2011
Real estate, at cost: |  |  |  |  |
| Land | $ | 74,974 |  | $ | 74,974
| Buildings and leasehold improvements |  | 986,360 |  |  | 985,637
| Development and construction in progress |  | 2,230 |  |  | 1,597
|  | Total |  | 1,063,564 |  |  | 1,062,208
Accumulated depreciation and amortization |  | (191,477) |  |  | (184,873)
Real estate, net |  | 872,087 |  |  | 877,335
Cash and cash equivalents |  | 530,252 |  |  | 506,619
Short-term investments |  | - |  |  | 5,000
Restricted cash |  | 87,801 |  |  | 88,769
Accounts receivable, net of allowance for doubtful accounts of $1,402 and $1,039, respectively |  | 2,864 |  |  | 2,552
Receivable arising from the straight-lining of rents |  | 189,758 |  |  | 188,289
Deferred lease and other property costs, net (including unamortized leasing fees to Vornado of |  |  |  |  |
| $48,068 and $48,776, respectively) |  | 65,033 |  |  | 66,237
Deferred debt issuance costs, net of accumulated amortization of $15,767 and $15,111, respectively | 10,841 |  |  | 11,254
Other assets |  | 14,354 |  |  | 25,252
|  |  | $ | 1,772,990 |  | $ | 1,771,307
|  | LIABILITIES AND EQUITY |  |  |  |  |
Notes and mortgages payable | $ | 1,327,234 |  | $ | 1,330,932
Amounts due to Vornado |  | 40,685 |  |  | 41,340
Accounts payable and accrued expenses |  | 40,340 |  |  | 34,577
Other liabilities |  | 1,213 |  |  | 1,213
|  | Total liabilities |  | 1,409,472 |  |  | 1,408,062
Commitments and contingencies |  |  |  |  |
Preferred stock: $1.00 par value per share; authorized, 3,000,000 shares; |  |  |  |  |
| issued and outstanding, none |  | - |  |  | -
Common stock: $1.00 par value per share; authorized, 10,000,000 shares; |  |  |  |  |
| issued, 5,173,450 shares; outstanding, 5,105,936 shares |  | 5,173 |  |  | 5,173
Additional capital |  | 31,801 |  |  | 31,801
Retained earnings |  | 322,532 |  |  | 322,201
|  |  |  | 359,506 |  |  | 359,175
Treasury stock: 67,514 shares, at cost |  | (375) |  |  | (375)
|  | Total Alexander’s equity |  | 359,131 |  |  | 358,800
Noncontrolling interest in consolidated subsidiary |  | 4,387 |  |  | 4,445
|  | Total equity |  | 363,518 |  |  | 363,245
|  |  | $ | 1,772,990 |  | $ | 1,771,307
See notes to consolidated financial statements (unaudited).

3

ALEXANDER’S, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(Amounts in thousands, except share and per share amounts)
|  |  |  | Three Months Ended
|  |  |  | March 31,
|  |  |  | 2012 |  | 2011
REVENUES |  |  |  |  |  |
| Property rentals |  | $ | 43,829 |  | $ | 43,465
| Expense reimbursements |  |  | 19,831 |  |  | 19,407
Total revenues |  |  | 63,660 |  |  | 62,872
EXPENSES |  |  |  |  |  |
| Operating (including fees to Vornado of $1,477 and $1,336, respectively) |  |  | 21,262 |  |  | 21,187
| Depreciation and amortization |  |  | 8,697 |  |  | 8,234
| General and administrative (including management fees to Vornado of $540 in each period) |  |  | 1,124 |  |  | 1,099
Total expenses |  |  | 31,083 |  |  | 30,520
OPERATING INCOME |  |  | 32,577 |  |  | 32,352
| Interest and other income, net |  |  | 34 |  |  | 105
| Interest and debt expense |  |  | (13,068) |  |  | (14,805)
| Income before income taxes |  |  | 19,543 |  |  | 17,652
| Income tax (expense) benefit |  |  | (119) |  |  | 160
Net income |  |  | 19,424 |  |  | 17,812
Net loss attributable to the noncontrolling interest |  |  | 58 |  |  | 395
Net income attributable to Alexander’s |  | $ | 19,482 |  | $ | 18,207
Net income per common share – basic and diluted |  | $ | 3.81 |  | $ | 3.57
Weighted average shares outstanding – basic and diluted |  |  | 5,106,984 |  |  | 5,105,936
Dividends per common share |  | $ | 3.75 |  | $ | 3.00
See notes to consolidated financial statements (unaudited).

4

ALEXANDER’S, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(UNAUDITED)
(Amounts in thousands)
|  |  |  |  |  |  |  |  |  |  |  |  | Non- |  |
| Common Stock |  | Additional |  | Retained |  | Treasury |  | Alexander’s |  | controlling |  | Total
| Shares |  | Amount |  | Capital |  | Earnings |  | Stock |  | Equity |  | Interest |  | Equity
Balance, December 31, 2010 | 5,173 | $ | 5,173 | $ | 31,501 | $ | 304,055 | $ | (375) | $ | 340,354 | $ | 3,422 | $ | 343,776
Net income | - |  | - |  | - |  | 18,207 |  | - |  | 18,207 |  | (395) |  | 17,812
Dividends paid | - |  | - |  | - |  | (15,318) |  | - |  | (15,318) |  | - |  | (15,318)
Balance, March 31, 2011 | 5,173 | $ | 5,173 | $ | 31,501 | $ | 306,944 | $ | (375) | $ | 343,243 | $ | 3,027 | $ | 346,270
Balance, December 31, 2011 | 5,173 | $ | 5,173 | $ | 31,801 | $ | 322,201 | $ | (375) | $ | 358,800 | $ | 4,445 | $ | 363,245
Net income | - |  | - |  | - |  | 19,482 |  | - |  | 19,482 |  | (58) |  | 19,424
Dividends paid | - |  | - |  | - |  | (19,151) |  | - |  | (19,151) |  | - |  | (19,151)
Balance, March 31, 2012 | 5,173 | $ | 5,173 | $ | 31,801 | $ | 322,532 | $ | (375) | $ | 359,131 | $ | 4,387 | $ | 363,518
See notes to consolidated financial statements (unaudited).

5

ALEXANDER’S, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(Amounts in thousands)
|  |  | Three Months Ended
|  |  | March 31,
CASH FLOWS FROM OPERATING ACTIVITIES |  | 2012 |  | 2011
Net income |  | $ | 19,424 |  | $ | 17,812
Adjustments to reconcile net income to net cash provided by operating activities: |  |  |  |  |  |
| Depreciation and amortization (including amortization of debt issuance costs) |  |  | 9,505 |  |  | 8,949
| Straight-lining of rental income |  |  | (1,469) |  |  | (3,743)
Change in operating assets and liabilities: |  |  |  |  |  |
| Accounts receivable, net |  |  | (677) |  |  | (410)
| Other assets |  |  | 10,481 |  |  | 9,065
| Amounts due to Vornado |  |  | (655) |  |  | 572
| Accounts payable and accrued expenses |  |  | 7,009 |  |  | 8,320
| Income tax liability of taxable REIT subsidiary |  |  | 7 |  |  | (11)
| Other liabilities |  |  | (7) |  |  | (7)
Net cash provided by operating activities |  |  | 43,618 |  |  | 40,547
CASH FLOW FROM INVESTING ACTIVITIES |  |  |  |  |  |
| Proceeds from maturing short-term investments |  |  | 5,000 |  |  | 23,000
| Construction in progress and real estate additions |  |  | (2,709) |  |  | (6,177)
| Restricted cash |  |  | 968 |  |  | (3,520)
Net cash provided by investing activities |  |  | 3,259 |  |  | 13,303
CASH FLOWS FROM FINANCING ACTIVITIES |  |  |  |  |  |
| Dividends paid |  |  | (19,151) |  |  | (15,318)
| Debt repayments |  |  | (3,698) |  |  | (3,809)
| Debt issuance costs |  |  | (395) |  |  | (12)
Net cash used in financing activities |  |  | (23,244) |  |  | (19,139)
Net increase in cash and cash equivalents |  |  | 23,633 |  |  | 34,711
Cash and cash equivalents at beginning of period |  |  | 506,619 |  |  | 397,220
Cash and cash equivalents at end of period |  | $ | 530,252 |  | $ | 431,931
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION |  |  |  |  |  |
| Cash payments for interest |  | $ | 12,258 |  | $ | 13,025
NON-CASH TRANSACTIONS |  |  |  |  |  |
| Non-cash additions to real estate included in accounts payable and accrued expenses |  | $ | 1,806 |  | $ | 3,594
| Write-off of fully amortized and depreciated assets |  | $ | 624 |  | $ | 1,503
See notes to consolidated financial statements (unaudited).

6

ALEXANDER’S, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. Organization

Alexander’s, Inc. (NYSE: ALX) is a real estate investment trust (“REIT”), incorporated in Delaware, engaged in leasing, managing, developing and redeveloping its properties. All references to “we,” “us,” “our,” “Company” and “Alexander’s” refer to Alexander’s, Inc. and its consolidated subsidiaries. We are managed by, and our properties are leased and developed by, Vornado Realty Trust (“Vornado”) (NYSE: VNO).

2. Basis of Presentation

The accompanying consolidated financial statements are unaudited and include the accounts of Alexander’s and its consolidated subsidiaries. All intercompany amounts have been eliminated. In our opinion, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and changes in cash flows have been made. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted. These condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q of the Securities and Exchange Commission (the “SEC”) and should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2011, as filed with the SEC. We have made estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

The results of operations for the three months ended March 31, 2012 are not necessarily indicative of the operating results for the full year.

We currently operate in one business segment.

3. Recently Issued Accounting Literature

In May 2011, the Financial Accounting Standards Board (“FASB”) issued Update No. 2011-04, Fair Value Measurements (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs (“ASU No. 2011-04”). ASU No. 2011-04 provides a uniform framework for fair value measurements and related disclosures between GAAP and International Financial Reporting Standards (“IFRS”) and requires additional disclosures, including: (i) quantitative information about unobservable inputs used, a description of the valuation processes used, and a qualitative discussion about the sensitivity of the measurements to changes in the unobservable inputs, for Level 3 fair value measurements; (ii) fair value of financial instruments not measured at fair value but for which disclosure of fair value is required, based on their levels in the fair value hierarchy; and (iii) transfers between Level 1 and Level 2 of the fair value hierarchy. The adoption of this update on January 1, 2012, did not have a material impact on our consolidated financial statements, but resulted in additional fair value measurement disclosures (see Note 7 - Fair Value Measurements).

7

ALEXANDER’S, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

4. Relationship with Vornado

At March 31, 2012, Vornado owned 32.4% of our outstanding common stock. We are managed by, and our properties are leased and developed by, Vornado, pursuant to the agreements described below which expire in March of each year and are automatically renewable.

Management and Development Agreements

We pay Vornado an annual management fee equal to the sum of (i) $3,000,000, (ii) 3% of gross revenue from the Kings Plaza Regional Shopping Center, (iii) 2% of gross revenue from the Rego Park II Shopping Center, (iv) $0.50 per square foot of the tenant-occupied office and retail space at 731 Lexington Avenue and (v) $256,000, escalating at 3% per annum, for managing the common area of 731 Lexington Avenue.

In addition, Vornado is entitled to a development fee of 6% of development costs, as defined, with minimum guaranteed fees of $750,000 per annum.

Leasing Agreements

Vornado also provides us with leasing services for a fee of 3% of rent for the first ten years of a lease term, 2% of rent for the eleventh through the twentieth year of a lease term, and 1% of rent for the twenty-first through thirtieth year of a lease term, subject to the payment of rents by tenants. In the event third-party real estate brokers are used, the fees to Vornado increase by 1% and Vornado is responsible for the fees to the third-party real estate brokers. Vornado is also entitled to a commission upon the sale of any of our assets equal to 3% of gross proceeds, as defined, for asset sales less than $50,000,000 and 1% of gross proceeds, as defined, for asset sales of $50,000,000 or more. The total of these amounts is payable in annual installments in an amount not to exceed $4,000,000, with interest on the unpaid balance at one-year LIBOR plus 1.0% (2.13% at March 31, 2012).

Other Agreements

We have also entered into agreements with Building Maintenance Services, a wholly owned subsidiary of Vornado, to supervise cleaning, engineering and security services at our Lexington Avenue and Kings Plaza properties for an annual fee of the cost for such services plus 6%.

The following is a summary of fees to Vornado under the agreements discussed above.

|  |  | Three Months Ended |
|  |  |  | March 31, |
| (Amounts in thousands) |  | 2012 |  | 2011 |
| Company management fees |  | $ | 750 |  | $ | 750 |
| Development fees |  |  | 188 |  |  | 188 |
| Leasing fees |  |  | 623 |  |  | 1,515 |
| Property management fees and payments for cleaning, engineering |  |  |  |  |  |  |
|  | and security services |  |  | 1,267 |  |  | 1,126 |
|  |  |  | $ | 2,828 |  | $ | 3,579 |

At March 31, 2012, we owed Vornado $40,064,000 for leasing fees and $621,000 for management, property management and cleaning fees.

8

ALEXANDER’S, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

5. Notes and Mortgages Payable

The following is a summary of our outstanding notes and mortgages payable. We may refinance our maturing debt as it comes due or choose to repay it at maturity.

|  |  |  |  |  |  |  | Balance at |
|  |  |  | Interest Rate at |  |  | March 31, |  | December 31, |
(Amounts in thousands) | Maturity |  | March 31, 2012 |  |  | 2012 |  | 2011 |
First mortgage, secured by the Rego Park I |  |  |  |  |  |  |  |  |  |  |  |
| Shopping Center (100% cash collateralized) | Mar. 2013 |  | 0.50 | % |  |  | $ | 78,246 |  | $ | 78,246 |
First mortgage, secured by the office space |  |  |  |  |  |  |  |  |  |  |  |
| at the Lexington Avenue property | Feb. 2014 |  | 5.33 | % |  |  |  | 336,812 |  |  | 339,890 |
First mortgage, secured by the retail space |  |  |  |  |  |  |  |  |  |  |  |
| at the Lexington Avenue property(1) | Jul. 2015 |  | 4.93 | % |  |  |  | 320,000 |  |  | 320,000 |
First mortgage, secured by the Kings Plaza |  |  |  |  |  |  |  |  |  |  |  |
| Regional Shopping Center(2) | Jun. 2016 |  | 1.94 | % |  |  |  | 250,000 |  |  | 250,000 |
First mortgage, secured by the Paramus property | Oct. 2018 |  | 2.90 | % |  |  |  | 68,000 |  |  | 68,000 |
First mortgage, secured by the |  |  |  |  |  |  |  |  |  |  |  |
| Rego Park II Shopping Center(3) | Nov. 2018 |  | 2.09 | % |  |  |  | 274,176 |  |  | 274,796 |
|  |  |  |  |  |  |  | $ | 1,327,234 |  | $ | 1,330,932 |
___________________ |  |  |  |  |  |  |  |  |  |  |  |
(1) | In the event of a substantial casualty, as defined, up to $75,000 of this loan may become recourse to us. |
(2) | This loan bears interest at LIBOR plus 1.70%. |
(3) | This loan bears interest at LIBOR plus 1.85%. |

6. Significant Tenants

Bloomberg L.P. (“Bloomberg”) accounted for $21,222,000 and $20,893,000, representing 33% of our consolidated revenues in each of the three month periods ended March 31, 2012 and 2011, respectively. No other tenant accounted for more than 10% of our consolidated revenues. If we were to lose Bloomberg as a tenant, or if Bloomberg were to fail or become unable to perform its obligations under its lease, it would adversely affect our results of operations and financial condition. We receive and evaluate certain confidential financial information and metrics from Bloomberg on a semi-annual basis. In addition, we access and evaluate financial information regarding Bloomberg from private sources, as well as publicly available data.

9

ALEXANDER’S, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

7. Fair Value Measurements

A ccounting S tandards C odification Topic 820, Fair Value Measurement and Disclosures (“ASC 820”) defines fair value and establishes a framework for measuring fair value. The objective of fair value is to determine the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (the exit price). ASC 820 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three levels: Level 1 – quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities; Level 2 – observable prices that are based on inputs not quoted in active markets, but corroborated by market data; and Level 3 – unobservable inputs that are used when little or no market data is available. The fair value hierarchy gives the highest priority to Level 1 inputs and the lowest priority to Level 3 inputs. In determining fair value, we utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as consider counterparty credit risk in our assessment of fair value.

Assets and Liabilities Measured at Fair Value

Financial assets measured at fair value in our consolidated financial statements at December 31, 2011 consist of short-term investments (CDARS classified as available-for-sale) and are presented in the table below based on their level in the fair value hierarchy. There were no financial assets measured at fair value at March 31, 2012 and t here were no financial liabilities measured at fair value at March 31, 2012 and December 31, 2011.

|  | As of December 31, 2011
(Amounts in thousands) | Total |  | Level 1 |  | Level 2 |  | Level 3
| Short-term investments | $ | 5,000 |  | $ | 5,000 |  | $ | - |  | $ | -

Financial Assets and Liabilities not Measured at Fair Value

Financial liabilities that are not measured at fair value in our consolidated financial statements consist of our notes and mortgages payable. The fair value of our notes and mortgages payable is calculated by discounting the future contractual cash flows of these instruments using current risk adjusted rates available to borrowers with similar credit ratings, which are provided by a third-party specialist. The fair value of our notes and mortgages payable is classified as Level 2. As of March 31, 2012 and December 31, 2011, the estimated fair value of our notes and mortgages payable was $1,386,000,000 and $1,374,000,000, respectively. Our fair value estimates, which are made at the end of the reporting period, may be different from the amounts that may ultimately be realized upon the disposition of our financial instruments. All financial assets were measured at fair value at March 31, 2012 and December 31, 2011.

10

ALEXANDER’S, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

8. Commitments and Contingencies

Insurance

We maintain general liability insurance with limits of $300,000,000 per occurrence and all-risk property and rental value insurance coverage with limits of $1.7 billion per occurrence, including coverage for terrorist acts, with sub-limits for certain perils such as floods and earthquakes on each of our properties.

Fifty-Ninth Street Insurance Company, LLC (“FNSIC”), our wholly owned consolidated subsidiary, act s as a direct insurer for coverage for acts of terrorism, including nuclear, biological, chemical and radiological (“NBCR”) acts, as defined by the Terrorism Risk Insurance Program Reauthorization Act of 2007. Coverage for acts of terrorism (including NBCR acts) is up to $1.7 billion per occurrence. Coverage for acts of terrorism (excluding NBCR acts) is fully reinsured by third party insurance companies with no exposure to FNSIC. F or NBCR acts, FNSIC is responsible for a $275,000 deductible and 15% of the balance of a covered loss and the Federal government is responsible for the remaining 85% of a covered loss. We are ultimately responsible for any loss borne by FNSIC.

There can be no assurance that we will be able to maintain similar levels of insurance coverage in the future in amounts and on terms that are commercially reasonable. We are responsible for deductibles and losses in excess of our insurance coverage, which could be material.

Our mortgage loans are non-recourse to us, except for $75,000,000 of the $320,000,000 mortgage on our 731 Lexington Avenue property, in the event of a substantial casualty, as defined. Our mortgage loans contain customary covenants requiring us to maintain insurance. If lenders insist on greater coverage than we are able to obtain, it could adversely affect our ability to finance our properties.

Flushing Property

In 2002, Flushing Expo, Inc. (“Expo”) agreed to purchase the stock of the entity which owns the Flushing property from us (“Purchase of the Property”) and gave us a non-refundable deposit of $1,875,000. Pursuant to a stipulation of settlement, we settled the action Expo brought against us regarding the Purchase of the Property and in June 2011, deposited the settlement amount with the Court, in exchange for which we received a stipulation of discontinuance, with prejudice, as well as general releases. In November 2011, Expo filed another action, this time against our tenant at the Flushing property asserting, among other things, that such tenant interfered with Expo’s Purchase of the Property from us. In this new action Expo is seeking $50,000,000 in damages from our tenant, who is seeking indemnification from us for such amount. We believe, after consultation with counsel, that the new claim is without merit. The amount or range of reasonably possible losses, if any, cannot be estimated.

Environmental Remediation

In July 2006, we discovered an oil spill at our Kings Plaza Regional Shopping Center. We have notified the New York State Department of Environmental Conservation (“NYSDEC”) about the spill and have developed a remediation plan. The NYSDEC has approved a portion of the remediation plan and clean up is ongoing. The estimated costs associated with the clean up will aggregate approximately $2,500,000. We have paid $500,000 of such amount and the remainder is covered under our insurance policy.

11

ALEXANDER’S, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

8. Commitments and Contingencies - continued

Paramus

In 2001, we leased 30.3 acres of land located in Paramus, New Jersey to IKEA Property, Inc. The lease has a 40-year term with a purchase option in 2021 for $75,000,000. The property is encumbered by a $68,000,000 interest-only mortgage loan with a fixed rate of 2.90%, which matures in October 2018. The annual triple-net rent is the sum of $700,000 plus the amount of debt service on the mortgage loan. If the purchase option is exercised, we will receive net cash proceeds of approximately $7,000,000 and recognize a gain on sale of land of approximately $62,000,000. If the purchase option is not exercised, the triple-net rent for the last 20 years would include debt service sufficient to fully amortize $68,000,000 over the remaining 20-year lease term.

Letters of Credit

Approximately $4,998,000 of standby letters of credit were outstanding as of March 31, 2012.

Other

There are various other legal actions against us in the ordinary course of business. In our opinion, the outcome of such matters in the aggregate will not have a material effect on our financial condition, results of operations or cash flows.

9. Earnings Per Share

The following table sets forth the computation of basic and diluted income per share, including a reconciliation of net income and the number of shares used in computing basic and diluted earnings per share. Basic income per share is determined using the weighted average shares of common stock outstanding during the period, including deferred stock units. Diluted income per share is determined using the weighted average shares of common stock outstanding during the period, including deferred stock units, and assumes all potentially dilutive securities were converted into common shares at the earliest date possible. There were no potentially dilutive securities outstanding during the three months ended March 31, 2012 and 2011.

|  |  |  |  | Three Months Ended
|  |  |  |  | March 31,
(Amounts in thousands, except share and per share amounts) |  | 2012 |  | 2011
| Net income attributable to common |  |  |  |  |  |
|  | stockholders – basic and diluted |  | $ | 19,482 |  | $ | 18,207
| Weighted average shares outstanding – basic and diluted |  |  | 5,106,984 |  |  | 5,105,936
| Net income per common share – basic and diluted |  | $ | 3.81 |  | $ | 3.57

12

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Alexander’s, Inc.

Paramus, New Jersey

We have reviewed the accompanying consolidated balance sheet of Alexander’s, Inc. and subsidiaries (the “Company”) as of March 31, 2012, and the related consolidated statements of income, changes in equity and cash flows for the three-month periods ended March 31, 2012 and 2011. These interim financial statements are the responsibility of the Company’s management.

We conducted our reviews in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our reviews, we are not aware of any material modifications that should be made to such consolidated interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of Alexander’s, Inc. and subsidiaries as of December 31, 2011, and the related consolidated statements of income, changes in equity and cash flows for the year then ended (not presented herein); and in our report dated February 27, 2012, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of December 31, 2011 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

/s/ DELOITTE & TOUCHE LLP

Parsippany, New Jersey
May 7, 2012

13

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Certain statements contained in this Quarterly Report constitute forward-looking statements as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are not guarantees of future performance. They involve risks, uncertainties and assumptions. Our future results, financial condition, results of operations and business may differ materially from those expressed in these forward-looking statements. You can find many of these statements by looking for words such as “approximates,” “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “would,” “may” or other similar expressions in this Quarterly Report on Form 10‑Q. These forward-looking statements represent our intentions, plans, expectations and beliefs and are subject to numerous assumptions, risks and uncertainties. Many of the factors that will determine these items are beyond our ability to control or predict. For a further discussion of factors that could materially affect the outcome of our forward-looking statements, see “Item 1A - Risk Factors” in our Annual Report on Form 10‑K for the year ended December 31, 2011. For these statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q or the date of any document incorporated by reference. All subsequent written and oral forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. We do not undertake any obligation to release publicly, any revisions to our forward-looking statements to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q.

Management’s Discussion and Analysis of Financial Condition and Results of Operations include a discussion of our consolidated financial statements for the three months ended March 31, 2012 and 2011. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

Critical Accounting Policies

A summary of our critical accounting policies is included in our Annual Report on Form 10-K for the year ended December 31, 2011 in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Note 2 – Summary of Significant Accounting Policies” to the consolidated financial statements included therein. There have been no significant changes to these policies during 2012.

14

Overview

Alexander’s, Inc. (NYSE: ALX) is a real estate investment trust (“REIT”), incorporated in Delaware, engaged in leasing, managing, developing and redeveloping properties. All references to “we,” “us,” “our,” “Company,” and “Alexander’s”, refer to Alexander’s, Inc. and its consolidated subsidiaries. We are managed by, and our properties are leased and developed by, Vornado Realty Trust (“Vornado”) (NYSE: VNO). We have seven properties in the greater New York City metropolitan area.

We compete with a large number of property owners and developers. Our success depends upon, among other factors, trends of national and local economies, the financial condition and operating results of current and prospective tenants, the availability and cost of capital, interest rates, construction and renovation costs, taxes, governmental regulations and legislation, population trends, zoning laws, and our ability to lease, sublease or sell our properties, at profitable levels. Our success is also subject to our ability to refinance existing debt on acceptable terms as it comes due.

Quarter Ended March 31, 2012 Financial Results Summary

Net income attributable to common stockholders for the quarter ended March 31, 2012 was $19,482,000, or $3.81 per diluted share, compared to $18,207,000, or $3.57 per diluted share, for the quarter ended March 31, 2011. Funds from operations attributable to common stockholders (“FFO”) for the quarter ended March 31, 2012 was $28,030,000, or $5.49 per diluted share, compared to $26,304,000, or $5.15 per diluted share, for the prior year’s quarter.

Recently Issued Accounting Literature

In May 2011, the Financial Accounting Standards Board (“FASB”) issued Update No. 2011-04, Fair Value Measurements (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs (“ASU No. 2011-04”). ASU No. 2011-04 provides a uniform framework for fair value measurements and related disclosures between accounting principles generally accepted in the United States of America (“GAAP”) and International Financial Reporting Standards (“IFRS”) and requires additional disclosures, including: (i) quantitative information about unobservable inputs used, a description of the valuation processes used, and a qualitative discussion about the sensitivity of the measurements to changes in the unobservable inputs, for Level 3 fair value measurements; (ii) fair value of financial instruments not measured at fair value but for which disclosure of fair value is required, based on their levels in the fair value hierarchy; and (iii) transfers between Level 1 and Level 2 of the fair value hierarchy. The adoption of this update on January 1, 2012, did not have a material impact on our consolidated financial statements, but resulted in additional fair value measurement disclosures.

15

Leasing Activity

The table below reflects property square footage, occupancy and leasing activity for our business. The leasing activity presented below is based on leases signed during the period and is not intended to coincide with the commencement of rental revenue in accordance with GAAP. Second generation relet space referred to in the table below represents square footage that has not been vacant for more than nine months.

| As of March 31, 2012: |  |  |  |
| Total square feet |  |  | 3,389,000 |
| Number of properties |  |  | 7 |
| Occupancy rate |  |  | 97.6% |
| Leasing Activity: |  |  |  |
| For the Quarter Ended March 31, 2012: |  |  |  |
| Total square feet leased (all retail) |  |  | 55,455 |
|  | Initial rent(1) |  | $ | 58.48 |
|  | Weighted average lease term (years) |  |  | 3.6 |
|  | Second generation relet space (all retail): |  |  |  |
|  |  | Square feet |  |  | 22,881 |
|  |  | Cash basis: |  |  |  |
|  |  |  | Initial rent(1) |  | $ | 79.35 |
|  |  |  | Prior escalated rent |  | $ | 79.10 |
|  |  |  | Percentage increase |  |  | 0.3% |
|  |  | GAAP basis: |  |  |  |
|  |  |  | Straight-line rent(2) |  | $ | 80.09 |
|  |  |  | Prior straight-line rent |  | $ | 76.01 |
|  |  |  | Percentage increase |  |  | 5.4% |
|  | Tenant improvements and leasing commissions: |  |  |  |
|  |  | Per square foot |  | $ | 13.67 |
|  |  | Per square foot per annum: |  | $ | 3.80 |
|  |  |  | Percentage of initial rent |  |  | 4.8% |
| (1) | Represents the cash basis weighted average starting rent per square foot, which is generally indicative of |
|  | market rents. Most leases include free rent and periodic step-ups in rent which are not included in the |
|  | initial rent per square foot. |
| (2) | Represents the GAAP basis weighted average rent per square foot that is recognized over the term of the |
|  | respective leases, and includes the effect of free rent and periodic step-ups in rent. |

Significant Tenants

Bloomberg L.P. (“Bloomberg”) accounted for $21,222,000 and $20,893,000, representing 33% of our consolidated revenues in each of the three month periods ended March 31, 2012 and 2011, respectively. No other tenant accounted for more than 10% of our consolidated revenues. If we were to lose Bloomberg as a tenant, or if Bloomberg were to fail or become unable to perform its obligations under its lease, it would adversely affect our results of operations and financial condition. We receive and evaluate certain confidential financial information and metrics from Bloomberg on a semi-annual basis. In addition, we access and evaluate financial information regarding Bloomberg from private sources, as well as publicly available data.

16

Results of Operations – Three Months Ended March 31, 2012 compared to March 31, 2011

Property Rentals

Property rentals were $43,829,000 in the quarter ended March 31, 2012, compared to $43,465,000 in the prior year’s quarter, an increase of $364,000.

Expense Reimbursements

Tenant expense reimbursements were $19,831,000 in the quarter ended March 31, 2012, compared to $19,407,000 in the prior year’s quarter, an increase of $424,000. This increase was primarily due to (i) higher real estate taxes, partially offset by (ii) lower reimbursable operating expenses and (iii) a true-up in operating expense billings in the current year’s quarter.

Operating Expenses

Operating expenses were $21,262,000 in the quarter ended March 31, 2012, compared to $21,187,000 in the prior year’s quarter, an increase of $75,000. This increase was primarily due to higher real estate taxes of $789,000, partially offset by lower reimbursable operating expenses of $612,000.

Depreciation and Amortization

Depreciation and amortization was $8,697,000 in the quarter ended March 31, 2012, compared to $8,234,000 in the prior year’s quarter, an increase of $463,000. This increase resulted primarily from depreciation on the portion of Rego Park II placed into service during the first quarter of 201 1.

General and Administrative Expenses

General and administrative expenses were $1,124,000 in the quarter ended March 31, 2012, compared to $1,099,000 in the prior year’s quarter, an increase of $25,000.

Interest and Other Income, net

Interest and other income, net was $34,000 in the quarter ended March 31, 2012, compared to $105,000 in the prior year’s quarter, a decrease of $71,000. This decrease was primarily due to lower average yields on investments.

Interest and Debt Expense

Interest and debt expense was $13,068,000 in the quarter ended March 31, 2012, compared to $14,805,000 in the prior year’s quarter, a decrease of $1,737,000. This de crease was primarily due to savings of $2,613,000 from lower average interest rates (3.62% in the current quarter as compared to 4.46% in the prior year’s quarter), partially offset by $766,000 from higher average outstanding debt balances.

Income Tax (Expense) Benefit

Income tax expense was $119,000 in the quarter ended March 31, 2012, as compared to a benefit of $160,000 in the prior year’s quarter. This increase in expense was primarily due to a true-up of accrued income taxes in the prior year’s quarter.

Net Loss Attributable to the Noncontrolling Interest

Net loss attributable to the noncontrolling interest was $58,000 in the quarter ended March 31, 2012, compared to $395,000 in the prior year’s quarter, and represents our venture partner’s 75% pro-rata share of net loss from our consolidated partially owned entity, the Kings Plaza energy plant joint venture.

17

Liquidity and Capital Resources

Cash Flows

Property rental income is our primary source of cash flow and is dependent on a number of factors including the occupancy level and rental rates of our properties, as well as our tenants’ ability to pay their rents. Our properties provide us with a relatively consistent stream of cash flow that enables us to pay our operating expenses, interest expense, recurring capital expenditures and cash dividends to stockholders. Other sources of liquidity to fund cash requirements include our existing cash, proceeds from financings, including mortgage or construction loans secured by our properties, and proceeds from asset sales. We anticipate that cash from operations over the next twelve months, together with existing cash balances, will be adequate to fund our business operations, cash dividends to stockholders, debt amortization and maturities, and recurring capital expenditures.

Three Months Ended March 31, 2012

Cash and cash equivalents were $530,252,000 at March 31, 2012, compared to $506,619,000 at December 31, 2011, an increase of $23,633,000. This in crease resulted from $43,618,000 of net cash provided by operating activities, $3,259,000 of net cash provided by investing activities, partially offset by $23,244,000 of net cash used in financing activities.

Net cash provided by operating activities of $43,618,000 was comprised of net income of $19,424,000, the net change in operating assets and liabilities of $16,158,000 and adjustments for non-cash items of $8,036,000. The net change in operating assets and liabilities was primarily due to amortization of prepaid real estate taxes of $9,990,000 and higher prepaid rents from tenants of $7,744,000. The adjustments for non-cash items were comprised of depreciation and amortization of $9,505,000, partially offset by straight-lining of rental income of $1,469,000.

Net cash provided by investing activities of $3,259,000 was comprised of (i) proceeds from maturing short-term investments of $5,000,000 and (ii) a decrease in restricted cash of $968,000, partially offset by (iii) capital expenditures of $2,709,000 (primarily Rego Park II).

Net cash used in financing activities of $23,244,000 was primarily comprised of dividends paid on common stock of $19,151,000 and debt amortization of $3,698,000.

Three Months Ended March 31, 2011

Cash and cash equivalents were $431,931,000 at March 31, 2011, compared to $397,220,000 at December 31, 2010, an increase of $34,711,000. This increase resulted from $40,547,000 of net cash provided by operating activities, $13,303,000 of net cash provided by investing activities, partially offset by $19,139,000 of net cash used in financing activities.

Net cash provided by operating activities of $40,547,000 was comprised of net income of $17,812,000, the net change in operating assets and liabilities of $17,529,000 and adjustments for non-cash items of $5,206,000. The net change in operating assets and liabilities was primarily due to higher prepaid rents from tenants of $7,752,000 and amortization of prepaid expenses of $10,025,000. The adjustments for non-cash items were comprised of depreciation and amortization of $8,949,000, partially offset by straight-lining of rental income of $3,743,000.

Net cash provided by investing activities of $13,303,000 was comprised of proceeds from maturing short-term investments of $23,000,000, partially offset by restricted cash of $3,520,000 and capital expenditures of $6,177,000, primarily related to the development of our Rego Park II project.

Net cash used in financing activities of $19,139,000 was comprised of dividends paid on common stock of $15,318,000 and debt amortization of $3,809,000.

18

Liquidity and Capital Resources – continued

Commitments and Contingencies

Insurance

We maintain general liability insurance with limits of $300,000,000 per occurrence and all-risk property and rental value insurance coverage with limits of $1.7 billion per occurrence, including coverage for terrorist acts, with sub-limits for certain perils such as floods and earthquakes on each of our properties.

Fifty-Ninth Street Insurance Company, LLC (“FNSIC”), our wholly owned consolidated subsidiary, acts as a direct insurer for coverage for acts of terrorism, including nuclear, biological, chemical and radiological (“NBCR”) acts, as defined by the Terrorism Risk Insurance Program Reauthorization Act of 2007. Coverage for acts of terrorism (including NBCR acts) is up to $1.7 billion per occurrence. Coverage for acts of terrorism (excluding NBCR acts) is fully reinsured by third party insurance companies with no exposure to FNSIC. For NBCR acts, FNSIC is responsible for a $275,000 deductible and 15% of the balance of a covered loss and the Federal government is responsible for the remaining 85% of a covered loss. We are ultimately responsible for any loss borne by FNSIC.

There can be no assurance that we will be able to maintain similar levels of insurance coverage in the future in amounts and on terms that are commercially reasonable. We are responsible for deductibles and losses in excess of our insurance coverage, which could be material.

Our mortgage loans are non-recourse to us, except for $75,000,000 of the $320,000,000 mortgage on our 731 Lexington Avenue property, in the event of a substantial casualty, as defined. Our mortgage loans contain customary covenants requiring us to maintain insurance. If lenders insist on greater coverage than we are able to obtain, it could adversely affect our ability to finance our properties.

Flushing Property

In 2002, Flushing Expo, Inc. (“Expo”) agreed to purchase the stock of the entity which owns the Flushing property from us (“Purchase of the Property”) and gave us a non-refundable deposit of $1,875,000. Pursuant to a stipulation of settlement, we settled the action Expo brought against us regarding the Purchase of the Property and in June 2011, deposited the settlement amount with the Court, in exchange for which we received a stipulation of discontinuance, with prejudice, as well as general releases. In November 2011, Expo filed another action, this time against our tenant at the Flushing property asserting, among other things, that such tenant interfered with Expo’s Purchase of the Property from us. In this new action Expo is seeking $50,000,000 in damages from our tenant, who is seeking indemnification from us for such amount. We believe, after consultation with counsel, that the new claim is without merit. The amount or range of reasonably possible losses, if any, cannot be estimated.

Environmental Remediation

In July 2006, we discovered an oil spill at our Kings Plaza Regional Shopping Center. We have notified the New York State Department of Environmental Conservation (“NYSDEC”) about the spill and have developed a remediation plan. The NYSDEC has approved a portion of the remediation plan and clean up is ongoing. The estimated costs associated with the clean up will aggregate approximately $2,500,000. We have paid $500,000 of such amount and the remainder is covered under our insurance policy.

Paramus

In 2001, we leased 30.3 acres of land located in Paramus, New Jersey to IKEA Property, Inc. The lease has a 40-year term with a purchase option in 2021 for $75,000,000. The property is encumbered by a $68,000,000 interest-only mortgage loan with a fixed rate of 2.90%, which matures in October 2018. The annual triple-net rent is the sum of $700,000 plus the amount of debt service on the mortgage loan. If the purchase option is exercised, we will receive net cash proceeds of approximately $7,000,000 and recognize a gain on sale of land of approximately $62,000,000. If the purchase option is not exercised, the triple-net rent for the last 20 years would include debt service sufficient to fully amortize $68,000,000 over the remaining 20-year lease term.

19

Liquidity and Capital Resources – continued

Commitments and Contingencies – continued

Letters of Credit

Approximately $4,998,000 of standby letters of credit were outstanding as of March 31, 2012.

Other

There are various other legal actions against us in the ordinary course of business. In our opinion, the outcome of such matters in the aggregate will not have a material effect on our financial condition, results of operations or cash flows.

Funds from Operations (“FFO”)

FFO is computed in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts (“NAREIT”). NAREIT defines FFO as GAAP net income or loss adjusted to exclude net gains from sales of depreciated real estate assets, real estate impairment losses, depreciation and amortization expense from real estate assets, extraordinary items and other specified non-cash items, including the pro rata share of such adjustments of unconsolidated subsidiaries. FFO and FFO per diluted share are used by management, investors and analysts to facilitate meaningful comparisons of operating performance between periods and among our peers because it excludes the effect of real estate depreciation and amortization and net gains on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions. FFO does not represent cash generated from operating activities and is not necessarily indicative of cash available to fund cash requirements and should not be considered as an alternative to net income as a performance measure or cash flow as a liquidity measure. FFO may not be comparable to similarly titled measures employed by other companies. A reconciliation of our net income to FFO is provided below.

FFO Attributable to Common Stockholders for the Quarters Ended March 31, 2012 and 2011

FFO attributable to common stockholders for the quarter ended March 31, 2012 was $28,030,000 or $5.49 per diluted share, compared to $26,304,000 or $5.15 per diluted share, for the prior year’s quarter.

The following table reconciles our net income to FFO:

|  |  |  |  | Three Months Ended
|  |  |  |  | March 31,
(Amounts in thousands, except share and per share amounts) |  | 2012 |  | 2011
Net income attributable to Alexander’s |  | $ | 19,482 |  | $ | 18,207
Depreciation and amortization of real property |  |  | 8,548 |  |  | 8,097
FFO attributable to common stockholders |  | $ | 28,030 |  | $ | 26,304
FFO attributable to common stockholders per diluted share |  | $ | 5.49 |  | $ | 5.15
Weighted average shares used in computing FFO per diluted share |  |  | 5,106,984 |  |  | 5,105,936

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

We have exposure to fluctuations in interest rates, which are sensitive to many factors that are beyond our control. Our exposure to a change in interest rates is summarized in the table below.

|  | 2012 |  | 2011
|  |  |  |  | Weighted |  | Effect of 1% |  |  |  |  | Weighted
|  | March 31, |  | Average |  | Change in |  | December 31, |  | Average
(Amounts in thousands, except per share amounts) | Balance |  | Interest Rate |  | Base Rates |  | Balance |  | Interest Rate
Variable Rate (including $40,064 and $40,728 |  |  |  |  |  |  |  |  |  |  |  |  |  |
| due to Vornado, respectively) | $ | 564,240 |  | 2.03% |  |  | $ | 5,642 |  | $ | 565,524 |  | 2.16% |
Fixed Rate |  | 803,058 |  | 4.49% |  |  |  | - |  |  | 806,136 |  | 4.78% |
|  | $ | 1,367,298 |  |  |  |  | $ | 5,642 |  | $ | 1,371,660 |  |  |
Total effect on diluted earnings per share |  |  |  |  |  |  | $ | 1.10 |  |  |  |  |  |

The fair value of our notes and mortgages payable is calculated by discounting the future contractual cash flows of these instruments using current risk adjusted rates available to borrowers with similar credit ratings, which are provided by a third-party specialist. As of March 31, 2012 and December 31, 2011, the estimated fair value of our notes and mortgages payable was $1,386,000,000 and $1,374,000,000, respectively. Our fair value estimates, which are made at the end of the reporting period, may be different from the amounts that may ultimately be realized upon the disposition of our financial instruments.

Item 4. Controls and Procedures

(a) Disclosure Controls and Procedures: Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, our disclosure controls and procedures are effective.

(b) Internal Control Over Financial Reporting: There have not been any changes in our internal control over financial reporting during the fiscal quarter to which this Quarterly Report on Form 10-Q relates that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

21

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

We are from time to time involved in legal actions arising in the ordinary course of business. In our opinion, the outcome of such matters in the aggregate will not have a material effect on our financial condition, results of operations or cash flows.

Item 1A. Risk Factors

There have been no material changes in our “Risk Factors” as previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2011.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

Exhibits required by Item 601 of Regulation S-K are filed herewith and are listed in the attached Exhibit Index.

22

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

|  | ALEXANDER’S, INC.
|  | (Registrant)
Date: May 7, 2012 | By: | /s/ Joseph Macnow
|  | Joseph Macnow, Executive Vice President and Chief Financial Officer (duly authorized officer and principal financial and accounting officer)

23

|  |  | EXHIBIT INDEX |
Exhibit |  |  |  |
No. |  |  |  |
3.1 |  | - | Amended and Restated Certificate of Incorporation. Incorporated herein by reference from Exhibit 3.1 to the registrant’s Registration Statement on Form S-3 filed on September 20, 1995 | *
3.2 |  | - | By-laws, as amended. Incorporated herein by reference from Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2000 | *
10.1 |  | - | Real Estate Retention Agreement dated as of July 20, 1992, between Vornado Realty Trust and Keen Realty Consultants, Inc., each as special real estate consultants, and the Company. Incorporated herein by reference from Exhibit 10(i)(O) to the registrant’s Annual Report on Form 10-K for the fiscal year ended July 25, 1992 | *
10.2 |  | - | Extension Agreement to the Real Estate Retention Agreement, dated as of February 6, 1995, between the Company and Vornado Realty Trust. Incorporated herein by reference from Exhibit 10(i)(G)(2) to the registrant’s Annual Report Form 10-K for the year ended December 31, 1994 | *
10.3 |  | - | Agreement of Lease dated as of April 30, 2001 between Seven Thirty One Limited Partnership, landlord, and Bloomberg L.P., tenant. Incorporated herein by reference from Exhibit 10(v) B to the registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2001, filed on August 2, 2001 | *
10.4 |  | - | Lease dated as of October 2, 2001 by and between ALX of Paramus LLC, as Landlord, and IKEA Property, Inc. as Tenant. Incorporated herein by reference from Exhibit 10(v)(C)(4) to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2001, filed on March 13, 2002 | *
10.5 |  | - | First Amendment to Real Estate Retention Agreement, dated as of July 3, 2002, by and between Alexander’s, Inc. and Vornado Realty, L.P. Incorporated herein by reference from Exhibit 10(i)(E)(3) to the registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2002, filed on August 7, 2002 | *
10.6 |  | - | 59th Street Real Estate Retention Agreement, dated as of July 3, 2002, by and between Vornado Realty, L.P., 731 Residential LLC and 731 Commercial LLC. Incorporated herein by reference from Exhibit 10(i)(E)(4) to the registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2002, filed on August 7, 2002 | *
10.7 |  | - | Amended and Restated Management and Development Agreement, dated as of July 3, 2002, by and between Alexander’s, Inc., the subsidiaries party thereto and Vornado Management Corp. Incorporated herein by reference from Exhibit 10(i)(F)(1) to the registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2002, filed on August 7, 2002 | *
10.8 |  | - | Kings Plaza Management Agreement, dated as of May 31, 2001, by and between Alexander’s Kings Plaza LLC and Vornado Management Corp. Incorporated herein by reference from Exhibit 10(i)(F)(3) to the registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2002, filed on August 7, 2002 | *
10.9 |  | - | Limited Liability Company Operating Agreement of 731 Residential LLC, dated as of July 3, 2002, among 731 Residential Holding LLC, as the sole member, Domenic A. Borriello, as an Independent Manager and Kim Lutthang, as an Independent Manager. Incorporated herein by reference from Exhibit 10(i)(A)(1) to the registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2002, filed on August 7, 2002 | *
|  |  | ___________________ |
| * |  | Incorporated by reference. |

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10.10 |  | - | Limited Liability Company Operating Agreement of 731 Commercial LLC, dated as of July 3, 2002, among 731 Commercial Holding LLC, as the sole member, Domenic A. Borriello, as an Independent Manager and Kim Lutthang, as an Independent Manager. Incorporated herein by reference from Exhibit 10(i)(A)(2) to the registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2002, filed on August 7, 2002 | *
10.11 |  | - | Reimbursement Agreement, dated as of July 3, 2002, by and between Alexander’s, Inc., 731 Commercial LLC, 731 Residential LLC and Vornado Realty, L.P. Incorporated herein by reference from Exhibit 10(i)(C)(8) to the registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2002, filed on August 7, 2002 | *
10.12 |  | - | First Amendment of Lease, dated as of April 19, 2002, between Seven Thirty One Limited Partnership, landlord and Bloomberg L.P., tenant. Incorporated herein by reference from Exhibit 10(v)(B)(2) to the registrant’s Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2002, filed on August 7, 2002 | *
10.13 |  | - | Loan and Security Agreement, dated as of February 13, 2004, between 731 Office One LLC, as Borrower and German American Capital Corporation, as Lender. Incorporated herein by reference from Exhibit 10.20 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.14 |  | - | Amended, Restated and Consolidated Mortgage, Security Agreement, Financing Statement and Assignment of Leases, Rent and Security Deposits by and between 731 Office One LLC as Borrower and German American Capital Corporation as Lender, dated as of February 13, 2004. Incorporated herein by reference from Exhibit 10.21 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.15 |  | - | Amended, Restated and Consolidated Note, dated as of February 13, 2004, by 731 Office One LLC in favor of German American Capital Corporation. Incorporated herein by reference from Exhibit 10.22 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.16 |  | - | Assignment of Leases, Rents and Security Deposits from 731 Office One LLC to German American Capital Corporation, dated as of February 13, 2004. Incorporated herein by reference from Exhibit 10.23 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.17 |  | - | Account and Control Agreement, dated as of February 13, 2004, by and among German American Capital Corporation as Lender, and 731 Office One LLC as Borrower, and JP Morgan Chase as Cash Management Bank. Incorporated herein by reference from Exhibit 10.24 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.18 |  | - | Manager’s Consent and Subordination of Management Agreement dated February 13, 2004 by 731 Office One LLC and Alexander’s Management LLC and German American Capital Corporation. Incorporated herein by reference from Exhibit 10.25 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
|  |  | ___________________ |
| * |  | Incorporated by reference. |

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10.19 |  | - | Note Exchange Agreement dated as of February 13, 2004 by and between 731 Office One LLC and German American Capital Corporation. Incorporated herein by reference from Exhibit 10.26 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.20 |  | - | Promissory Note A-1 dated as of February 13, 2004 by 731 Office One LLC in favor of German American Capital Corporation. Incorporated herein by reference from Exhibit 10.27 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.21 |  | - | Promissory Note A-2 dated as of February 13, 2004 by 731 Office One LLC in favor of German American Capital Corporation. Incorporated herein by reference from Exhibit 10.28 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.22 |  | - | Promissory Note A-3 dated as of February 13, 2004 by 731 Office One LLC in favor of German American Capital Corporation. Incorporated herein by reference from Exhibit 10.29 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.23 |  | - | Promissory Note A-4 dated as of February 13, 2004, by 731 Office One LLC in favor of German American Capital Corporation. Incorporated herein by reference from Exhibit 10.30 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.24 |  | - | Promissory Note A-X dated as of February 13, 2004, by 731 Office One LLC in favor of German American Capital Corporation. Incorporated herein by reference from Exhibit 10.31 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.25 |  | - | Promissory Note B dated as of February 13, 2004, by 731 Office One LLC in favor of German American Capital Corporation. Incorporated herein by reference from Exhibit 10.32 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.26 |  | - | Guaranty of Recourse Obligations dated as of February 13, 2004, by Alexander’s, Inc. to and for the benefit of German American Capital Corporation. Incorporated herein by reference from Exhibit 10.33 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.27 |  | - | Environmental Indemnity dated as of February 13, 2004, by Alexander’s, Inc. and 731 Office One LLC for the benefit of German American Capital Corporation. Incorporated herein by reference from Exhibit 10.34 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2003, filed on March 2, 2004 | *
10.28 |  | - | Loan Agreement dated as of July 6, 2005, between 731 Retail One LLC, as Borrower and Archon Financial, as Lender. Incorporated herein by reference from Exhibit 10.1 to the registrant’s Current Report on Form 8-K, filed on July 12, 2005 | *
|  |  | __________________ |
| * |  | Incorporated by reference. |

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10.29 | ** | - | Form of Stock Option Agreement between the Company and certain employees. Incorporated herein by reference from Exhibit 10.61 to the registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2005, filed on October 27, 2005 | *
10.30 | ** | - | Form of Restricted Stock Option Agreement between the Company and certain employees. Incorporated herein by reference from Exhibit 10.62 to the registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2005, filed on October 27, 2005 | *
10.31 | ** | - | Registrant’s 2006 Omnibus Stock Plan dated April 4, 2006. Incorporated herein by reference from Annex B to Schedule 14A, filed by the registrant on April 28, 2006 | *
10.32 |  | - | Second Amendment to Real Estate Retention Agreement, dated as of January 1, 2007, by and between Alexander’s, Inc. and Vornado Realty L.P. Incorporated herein by reference from Exhibit 10.64 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2006, filed on February 26, 2007 | *
10.33 |  | - | Amendment to 59th Street Real Estate Retention agreement, dated as of January 1, 2007, by and among Vornado Realty L.P., 731 Retail One LLC, 731 Restaurant LLC, 731 Office One LLC and 731 Office Two LLC. Incorporated herein by reference from Exhibit 10.65 to the registrant’s Annual Report on Form 10-K for the year ended December 31, 2006, filed on February 26, 2007 | *
10.34 |  | - | First Amendment to Amended and Restated Management and Development Agreement, dated as of July 6, 2005, by and between Alexander’s, Inc., the subsidiaries party thereto and Vornado Management Corp. Incorporated herein by reference from Exhibit 10.52 to the registrant’s Annual Report on Form 10-K, for the year ended December 31, 2007, filed on February 25, 2008 | *
10.35 |  | - | Second Amendment to Amended and Restated Management and Development Agreement, dated as of December 20, 2007, by and between Alexander’s, Inc., the subsidiaries party thereto and Vornado Management Corp. Incorporated herein by reference from Exhibit 10.53 to the registrant’s Annual Report on Form 10-K, for the year ended December 31, 2007, filed on February 25, 2008 | *
10.36 |  | - | Third Amendment to Real Estate Retention Agreement, dated as of December 20, 2007, by and between Alexander’s, Inc., and Vornado Realty L.P. Incorporated herein by reference from Exhibit 10.55 to the registrant’s Annual Report on Form 10-K, for the year ended December 31, 2007, filed on February 25, 2008 | *
10.37 |  | - | Loan Agreement dated as of March 10, 2009 between Alexander’s Rego Park Shopping Center Inc., as Borrower and U.S. Bank National Association, as Lender. Incorporated herein by reference from Exhibit 10.55 to the registrant’s Quarterly Report on for 10-Q for the quarter ended March 31, 2009, filed on May 4, 2009 | *
10.38 |  | - | Amended and Restated Mortgage, Security Agreement, Fixture Filing and Assignment of Leases and Rentals by and between Alexander’s Rego Shopping Center, Inc. as Borrower and U.S. Bank National Association as Lender, dated as of March 10, 2009. Incorporated herein by reference from Exhibit 10.56 to the registrant’s Quarterly Report on for 10-Q for the quarter ended March 31, 2009, filed on May 4, 2009 | *
10.39 |  | - | Amended and Restated Promissory Note dated as of March 10, 2009, by Alexander’s Rego Shopping Center Inc., in favor of U.S. Bank National Association. Incorporated herein by reference from Exhibit 10.57 to the registrant’s Quarterly Report on for 10-Q for the quarter ended March 31, 2009, filed on May 4, 2009 | *
|  |  | ___________________ |
| * |  | Incorporated by reference. |
| ** |  | Management contract or compensatory agreement. |

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10.40 |  | - | Cash Pledge Agreement dated as of March 10, 2009, executed by Alexander’s Rego Shopping Center Inc. to and for the benefit of U.S. Bank National Association. Incorporated herein by reference from Exhibit 10.58 to the registrant’s Quarterly Report on for 10-Q for the quarter ended March 31, 2009, filed on May 4, 2009 | *
10.41 |  | - | Lease dated as of February 7, 2005, by and between 731 Office One LLC, as Landlord, and Citibank, N.A., as Tenant. Incorporated herein by reference from Exhibit 10.59 to the registrant’s Quarterly Report on for 10-Q for the quarter ended March 31, 2009, filed on May 4, 2009 | *
10.42 |  | - | Assignment and Assumption and Consent Agreement, dated as of March 25, 2009, by and between 731 Office One LLC, as Landlord, Citicorp North America, Inc., as Assignor, and Bloomberg L.P., as Assignee. Incorporated herein by reference from Exhibit 10.60 to the registrant’s Quarterly Report on form 10-Q for the quarter ended March 31, 2009, filed on May 4, 2009 | *
10.43 | ** | - | Alexander’s, Inc. 2006 Ominibus Stock Plan Deferred Stock Unit Agreement. Incorporated herein by reference to Exhibit 99.1 to the registrant’s Current Report on Form 8-K, filed on June 2, 2011 | *
10.44 |  | - | Loan Agreement dated June 10, 2011, among Alexander’s of Kings, LLC, Kings Parking, LLC, and Alexander’s Kings Plaza, LLC, individually or collectively, as borrower, and the Financial Institutions and their Assignees under Section 11.15, as lenders, and Wells Fargo Bank, N.A., as administrative agent. Incorporated herein by reference from Exhibit 10.57 to the registrant’s Quarterly Report on form 10-Q for the quarter ended June 30, 2011, filed on August 1, 2011 | *
10.45 |  | - | Consolidated Amended and Restated Promissory Note dated June 10, 2011, among Alexander’s of Kings, LLC, Kings Parking, LLC, and Alexander’s Kings Plaza, LLC, individually or collectively, as borrower, and Wells Fargo Bank, N.A., Royal Bank of Canada, and Credit Agricole Corporate and Investment Bank, individually or collectively, as Lenders. Incorporated herein by reference from Exhibit 10.58 to the registrant’s Quarterly Report on form 10-Q for the quarter ended June 30, 2011, filed on August 1, 2011 | *
10.46 |  | - | Consolidated Amended and Restated Fee and Leasehold Mortgage, Assignment of Leases and Rents and Security Agreement dated June 10, 2011, among Alexander’s of Kings, LLC, Kings Parking, LLC, and Alexander’s Kings Plaza, LLC, individually or collectively, as mortgagor and Wells Fargo Bank, N.A., as mortgagee. Incorporated herein by reference from Exhibit 10.59 to the registrant’s Quarterly Report on form 10-Q for the quarter ended June 30, 2011, filed on August 1, 2011 | *
10.47 |  | - | Guaranty of Recourse Obligations, dated June 10, 2011, by Alexander’s, Inc., as Guarantor, to and for the benefit of Wells Fargo Bank, N.A., as Administrative Agent. Incorporated herein by reference from Exhibit 10.60 to the registrant’s Quarterly Report on form 10-Q for the quarter ended June 30, 2011, filed on August 1, 2011 | *
10.48 |  | - | Environmental Indemnity Agreement dated June 10, 2011, by Alexander’s of Kings, LLC, Kings Parking, LLC, and Alexander’s Kings Plaza, LLC, and Alexander’s, Inc., individually or collectively, as Indemnitor, to Wells Fargo Bank, N.A., as Administrative Agent. Incorporated herein by reference from Exhibit 10.61 to the registrant’s Quarterly Report on form 10-Q for the quarter ended June 30, 2011, filed on August 1, 2011 | *
|  |  | ___________________ |
| * |  | Incorporated by reference. |
| ** |  | Management contract or compensatory agreement. |

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10.49 |  | - | Third Amendment to Amended and Restated Management and Development Agreement, dated as of November 30, 2011, by and between Alexander’s, Inc., the subsidiaries party thereto and Vornado Management Corp. Incorporated herein by reference from Exhibit 10.49 to the registrant’s Annual Report on form 10-K for the year ended December 31, 2011, filed on February 27, 2012 | *
10.50 |  | - | Loan and Security Agreement, dated November 30, 2011, by and between Rego II Borrower LLC, as Borrower, and the Lender | **
10.51 |  | - | Consolidated, Amended and Restated Promissory Note, dated November 30, 2011, by and between Rego II Borrower LLC, as Maker, and the Lender. Incorporated herein by reference from Exhibit 10.51 to the registrant’s Annual Report on form 10-K for the year ended December 31, 2011, filed on February 27, 2012 | *
10.52 |  | - | Consolidated, Amended and Restated Mortgage, Assignment of Leases and Rents and Security Agreement, dated November 30, 2011, by and between Rego II Borrower LLC, as Mortgagor, and the Mortgagee. Incorporated herein by reference from Exhibit 10.52 to the registrant’s Annual Report on form 10-K for the year ended December 31, 2011, filed on February 27, 2012 | *
10.53 |  | - | Guarantee of Recourse Carveouts, dated November 30, 2011, by Alexander’s, Inc., as Guarantor, to and for the benefit of the Lender. Incorporated herein by reference from Exhibit 10.53 to the registrant’s Annual Report on form 10-K for the year ended December 31, 2011, filed on February 27, 2012 | *
10.54 |  | - | Environmental Indemnity Agreement, dated November 30, 2011, among Rego II Borrower LLC and Alexander’s, Inc., individually or collectively as Indemnitor, in favor of the Lender. Incorporated herein by reference from Exhibit 10.54 to the registrant’s Annual Report on form 10-K for the year ended December 31, 2011, filed on February 27, 2012 | *
10.55 |  | - | First Omnibus Loan Modification and Extension Agreement dated March 12, 2012 by and between Alexander’s Rego Shopping Center, Inc., as Borrower and U.S. Bank National Association, as Lender |
10.56 |  | - | Mortgage Modification Agreement dated March 12, 2012 by and between Alexander’s Rego Shopping Center, Inc., as Mortgagor and U.S. Bank National Association, as Mortgagee |
15.1 |  | - | Letter regarding unaudited interim financial information |
31.1 |  | - | Rule 13a-14 (a) Certification of the Chief Executive Officer |
31.2 |  | - | Rule 13a-14 (a) Certification of the Chief Financial Officer |
32.1 |  | - | Section 1350 Certification of the Chief Executive Officer |
32.2 |  | - | Section 1350 Certification of the Chief Financial Officer |
|  |  | ___________________ |
| * |  | Incorporated by reference. |
| ** |  | Certain provisions of this exhibit have been omitted pursuant to a request for confidential treatment. |

29

101.INS |  | - | XBRL Instance Document |
101.SCH |  | - | XBRL Taxonomy Extension Schema |
101.CAL |  | - | XBRL Taxonomy Extension Calculation Linkbase |
101.DEF |  | - | XBRL Taxonomy Extension Definition Linkbase |
101.LAB |  | - | XBRL Taxonomy Extension Label Linkbase |
101.PRE |  | - | XBRL Taxonomy Extension Presentation Linkbase |

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