1 Cover Image: Artist Rendering of PENN 2 VORNADO COMPANY PROFILE Vornado Realty Trust is a fully-integrated real estate operating company. We own all or portions of: • 19.1 million square feet of Manhattan office space in 35 properties; • 2.3 million square feet of Manhattan street retail space in 70 properties; • 1,991 units in ten Manhattan residential properties; • The 1,700 room Hotel Pennsylvania located on Seventh Avenue at 33rd Street in the heart of THE PENN DISTRICT; • A 32.4% interest in Alexander’s, Inc. (NYSE:ALX) which owns seven properties in the greater New York metropolitan area including 731 Lexington Avenue, the 1.3 million square foot Bloomberg L.P. headquarters building; • Signage throughout THE PENN DISTRICT and Times Square; • BMS, our wholly owned subsidiary, which provides cleaning and security services for our buildings and third parties, employing 2,914 associates; • The 3.7 million square foot MART in Chicago; • A 70% controlling interest in 555 California Street, a three-building office complex in San Francisco’s financial district aggregating 1.8 million square feet; • A 25% interest in Vornado Capital Partners, our real estate fund. We are the general partner and investment manager of the fund. The fund is in wind down; • 220 Central Park South, our 950-foot super-tall luxury residential condominium tower containing 400,000 salable square feet, which is 91% sold with closings scheduled through 2020. Vornado’s common shares are listed on the New York Stock Exchange and are traded under the symbol: VNO. 1 2 F I N A N C I A L HIGHLIGHTS Year Ended December 31, As Reported 2019 2018 Revenues $ 1,924,700,000 $ 2,163,720,000 Net income $ 3,097,806,000 $ 384,832,000 Net income per share⎯ basic $ 16.23 $ 2.02 Net income per share⎯ diluted $ 16.21 $ 2.01 Total assets $ 18,287,013,000 $ 17,180,794,000 Total equity $ 7,310,978,000 $ 5,107,883,000 Net operating income $ 1,259,777,000 $ 1,382,620,000 Funds from operations $ 1,003,398,000 $ 729,740,000 Funds from operations per share $ 5.25 $ 3.82 % increase in funds from operations per share 37.4% 1.9% Year Ended December 31, As Adjusted 2019 2018 Revenues $ 1,909,378,000 $ 2,141,062,000 Net income $ 176,716,000 $ 238,700,000 Net income per share⎯ basic $ 0.92 $ 1.25 Net income per share⎯ diluted $ 0.92 $ 1.25 Total assets $ 19,203,348,000 $ 19,509,830,000 Net operating income $ 1,259,400,000 $ 1,368,720,000 Funds from operations $ 666,207,000 $ 713,488,000 Funds from operations per share $ 3.49 $ 3.73 % (decrease)/increase in funds from operations per share (6.4%) 0.0% These financial highlights and the Chairman’s Letter to our shareholders also present certain non-GAAP measures, including revenues, net income, total assets, NOI and Funds from Operations, all as adjusted as well as Funds from Operations and NOI. We have provided reconciliations of these non-GAAP measures to the applicable GAAP measures in the appendix section of this Chairman’s Letter and in the Company’s Annual Report on Form 10-K under “Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which accompanies this letter or can be viewed at www.vno.com. 3 To Our Shareholders While most of this letter is business as usual…today nothing is usual. We are now in the eye of the COVID-19 storm – a black swan apocalypse. Life as we know it is upside down, people are hurting, businesses are hurting, the future is uncertain. As our first priority we are following all protocols and taking all measures to protect our employees, our tenants and our communities. We pray for the health and safety of all and we commend and admire the talent and courage of our healthcare providers. Vornado is in a strong position to weather the storm and we will continue to do our part to help mitigate the impact. Net Income attributable to common shares for the year ended December 31, 2019 was $3,097.8 million, $16.21 per diluted share, compared to $384.8 million, $2.01 per diluted share, for the previous year. This increase is primarily attributable to the Retail Joint Venture transaction. See page 9. Funds from Operations, as Adjusted (an apples-to-apples comparison of our continuing business, eliminating certain one-timers) for the year ended December 31, 2019 was $666.2 million, $3.49 per diluted share, compared to $713.5 million, $3.73 per diluted share, for the previous year, a 6.4% decrease per share. This decrease is detailed on page 5. Funds from Operations, as Reported (apples-to-apples including one-timers) for the year ended December 31, 2019 was $1,003.4 million, $5.25 per diluted share, compared to $729.7 million, $3.82 per diluted share, for the previous year. See page 5 for a reconciliation of Funds from Operations, as Reported, to Funds from Operations, as Adjusted. Here are our financial results (presented in Net Operating Income format) by business unit: (1) 2019 Net Operating Income Same Store Increase/ % Increase/ % of 2019 (Decrease) ($ IN MILLIONS) (Decrease) NOI 2019/2018 2019 2018 2017 NOI - Cash Net Operating Income: Basis(1) NOI(1) New York: Office(2) 2.8% 2.2% 59.9% (2.2) 717.7 719.9 699.1 Retail(2) 1.1% (2.2%) 20.4% (16.2) 244.2 260.4 270.8 Retail Joint Venture N/A N/A N/A (80.4) 35.8 116.2 111.2 Residential 0.4% 1.2% 1.9% (0.1) 23.4 23.5 24.4 Alexander’s 0.1% (0.1%) 3.7% (0.8) 44.3 45.1 47.3 Hotel Pennsylvania (41.1%) (37.9%) 0.6% (4.5) 7.4 11.9 13.3 Total New York 1.6% 0.5% 86.5% (104.2) 1,072.8 1,177.0 1,166.1 TheMART 18.6% 15.9% 8.5% 11.2 102.1 90.9 102.3 555 California Street 12.7% 9.7% 5.0% 5.0 59.7 54.7 47.6 100.0% (88.0) 1,234.6 1,322.6 1,316.0 Other (see below for details) (34.8) 25.2 60.0 85.4 Total Net Operating Income (122.8) 1,259.8 1,382.6 1,401.4 Other Net Operating Income is comprised of: ($ IN MILLIONS) 2019 2018 2017 Pennsylvania REIT (converted to marketable securities March 2019, sold January 23, 2020) 9.8 20.0 21.1 666 Fifth Avenue Office Condominium (sold August 3, 2018) -- 12.1 20.6 Urban Edge Properties (sold March 4, 2019) 4.9 11.8 14.5 Other 10.5 16.1 29.2 Total 25.2 60.0 85.4 This letter and this Annual Report contain 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 performance. The Company’s future results, financial condition and business may differ materially from those expressed in these forward-looking statements. These forward-looking statements are subject to numerous assumptions, risks and uncertainties, including the impact of the COVID-19 virus on us, our tenants and the local and national economies. Many of the factors that will determine these items are beyond our ability to control or predict. For further discussion of many of these factors, see “Forward-Looking Statements” and “Item 1A. Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, a copy of which accompanies this letter or can be viewed at www.vno.com. 1 Straight-lining of rents and amortization of below-market leases, net are excluded from NOI - Cash Basis. 2 On April 18, 2019 we completed the transfer of a 45.4% common equity interest in Vornado’s portfolio of flagship high street retail assets on Upper Fifth Avenue and Times Square to a group of institutional investors (“Retail Joint Venture”). The historical financial results of the portion of the Retail Joint Venture assets that were transferred have been removed from the Office and Retail lines and reflected on the Retail Joint Venture line for all periods presented. 4 The following chart reconciles Funds from Operations, as Reported to Funds from Operations, as Adjusted: ($ IN MILLIONS, EXCEPT PER SHARE) 2019 2018 Funds from Operations, as Reported 1,003.4 729.7 Less adjustments for certain items that impact FFO: After-tax gain on sale of 220 Central Park South units 502.6 67.3 Acquisition related costs (4.6 ) (3.3 ) Prepayment penalty on redemption of $400 million 5% senior unsecured notes (22.5 ) -- Real Estate Fund (48.8 ) (23.7 ) Non-cash impairment loss and related write-off on 608 Fifth Avenue (77.1) -- 666 Fifth Avenue Office Condominium -- 3.1 Gain on repayment of loan - 666 Fifth Avenue Office -- 7.3 Previously capitalized internal leasing costs -- 5.5 Transfer taxes -- (23.5 ) Preferred shares issuance costs -- (14.5 ) Other, primarily noncontrolling interests’ share of above adjustments (12.4 ) (2.0 ) Total adjustments 337.2 16.2 Funds from Operations, as Adjusted 666.2 713.5 Funds from Operations, as Adjusted per share 3.49 3.73 Funds from Operations, as Adjusted decreased by $47.3 million in 2019 to $3.49 from $3.73 per share, a decrease of $0.24 per share, or 6.4%.