PRESS RELEASE

PARAMUS, N.J.--(BUSINESS WIRE)--

Vornado Realty Trust (NYSE:VNO) announced today that it will record its 32.7% share of Toys "R" Us' first quarter financial results in its second quarter ending June 30, 2008. Vornado's results will include a net loss of $15,811,000 or $.09 per diluted share compared to a net loss of $20,029,000 or $.11 per diluted share recorded in the quarter ended June 30, 2007.

Vornado's share of negative Funds From Operations ("FFO") before income taxes for the quarter ended June 30, 2008 is $14,550,000 or $.08 per share as compared to negative FFO before income taxes of $17,867,000 or $.10 per share in the prior year's quarter. In the quarter ended June 30, 2008, Vornado's results will include negative FFO after income taxes of $5,401,000, or $.03 per share as compared to negative FFO after income taxes of $8,917,000, or $.05 per share in the quarter ended June 30, 2007.

The business of Toys is highly seasonal; historically, Toys' fourth quarter net income accounts for more than 80% of its fiscal year net income.

Attached is a summary of Toys' financial results and Vornado's 32.7% share of its equity in Toys' net income, as well as reconciliations of net income to earnings before interest, taxes, depreciation and amortization ("EBITDA") and FFO.

Vornado Realty Trust is a fully-integrated equity real estate investment trust.

Certain statements contained herein may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, risks associated with the timing of and costs associated with property improvements, financing commitments and general competitive factors.

                          Toys "R" Us, Inc.
     Condensed Consolidated Statements of Operations - Unaudited

                                       For the Quarter Ended
                              ---------------------------------------
                                     May 3, 2008          May 5, 2007
                              -------------------------   -----------
                                            Results on    Results on
                                             Vornado's     Vornado's
                              Results on     Purchase      Purchase
                                   a           Price         Price
                               Historical    Accounting    Accounting
(Amounts in thousands)           Basis         Basis         Basis
                              -----------   -----------   -----------
Net sales                     $ 2,719,000   $ 2,719,000   $ 2,581,000
Cost of sales                   1,742,000     1,742,000     1,671,000
                              -----------   -----------   -----------
  Gross margin                    977,000       977,000       910,000
                              -----------   -----------   -----------

Selling, general and
 administrative expenses          875,000       887,100       803,500
Depreciation and amortization     100,000       107,000       106,700
Net gains on sales of
 properties                            --            --        (4,900)
Restructuring charges and
 other                                 --            --         2,000
                              -----------   -----------   -----------
  Total operating expenses        975,000       994,100       907,300
                              -----------   -----------   -----------
Operating income (loss)             2,000       (17,100)        2,700
Interest expense                 (100,000)     (104,000)     (124,900)
Interest income                     7,000         7,000         8,000
                              -----------   -----------   -----------
Loss before income tax
 benefit and minority
 interest                         (91,000)     (114,100)     (114,200)
Income tax benefit                 44,000        51,200        46,400
Minority interest                  11,000         8,500         6,000
                              -----------   -----------   -----------
Net loss                      $   (36,000)  $   (54,400)  $   (61,800)
                              ===========   ===========   ===========

Vornado's 32.7% equity in
 Toys' net loss                             $   (17,798)  $   (20,279)
Adjustment to eliminate
 Vornado's share of the
 after-tax net gain
 recognized by Toys on the
 sale of 2 stores to Vornado
 on April 11, 2007, which
 Vornado reflected as an
 adjustment to the basis of
 its investment                                                (1,045)
Management fee from Toys, net                     1,447           584
Interest income on credit
 facility                                           540           711
                                            -----------   -----------
Total Vornado net loss from
 its investment in Toys                     $   (15,811)  $   (20,029)
                                            ===========   ===========

See page 3 for a
 reconciliation of net income
 to FFO.

Reconciliation of Vornado's
 net income from its
 investment in Toys to EBITDA
 (1):
Net loss                                    $   (15,811)  $   (20,029)
Interest and debt expense                        33,905        40,985
Depreciation and amortization                    34,034        33,303
Income tax benefit                              (15,097)      (14,934)
                                            -----------   -----------
Vornado's 32.7% share of
 Toys' EBITDA (1)                           $    37,031   $    39,325
                                            ===========   ===========

(1) EBITDA represents "Earnings Before Interest, Taxes, Depreciation and Amortization." Management considers EBITDA a supplemental measure for making decisions and assessing the un-levered performance of its segments as it relates to the total return on assets as opposed to the levered return on equity. As properties are bought and sold based on a multiple of EBITDA, management utilizes this measure to make investment decisions as well as to compare the performance of its assets to that of its peers. EBITDA should not be considered a substitute for net income. EBITDA may not be comparable to similarly titled measures employed by other companies.

                          Toys "R" Us, Inc.
                  Funds From Operations - Unaudited

(Amounts in thousands)                         For the Quarter Ended
                                             -------------------------
                                             May 3, 2008   May 5, 2007
                                             -----------   -----------
Reconciliation of Vornado's net loss from
 its investment in Toys to FFO (1):
Net loss                                     $   (15,811)  $  (20,029)
Depreciation and amortization of real
 property                                         16,358       17,096
Income tax effect of above adjustment             (5,948)      (5,984)
                                             -----------   ----------
Vornado's share of FFO (1)                   $    (5,401)  $   (8,917)
                                             ===========   ==========

(1) 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 net income or loss determined in accordance with Generally Accepted Accounting Principles ("GAAP"), excluding extraordinary items as defined under GAAP and gains or losses from sales of previously depreciated operating real estate assets, plus specified non-cash items, such as real estate asset depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. FFO is used by management, investors and industry analysts as supplemental measures of operating performance of equity REITs. FFO should be evaluated along with GAAP net income and income per diluted share (the most directly comparable GAAP measures), as well as cash flow from operating activities, investing activities and financing activities, in evaluating the operating performance of equity REITs. Management believes that FFO is helpful to investors as supplemental performance measures because these measures exclude the effect of depreciation, amortization and gains or losses from sales of real estate, all of which are based on historical costs which implicitly assumes that the value of real estate diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, these non-GAAP measures can facilitate comparisons of operating performance between periods and among other equity REITs. FFO does not represent cash generated from operating activities in accordance with GAAP and is not necessarily indicative of cash available to fund cash needs as disclosed in the Company's Consolidated Statements of Cash Flows. FFO should not be considered as an alternative to net income as an indicator of the Company's operating performance or as an alternative to cash flows as a measure of liquidity.

Source: Vornado Realty Trust