1
                       SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                                  FORM 10-K\A
                                AMENDMENT NO. 1 

/XX/   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
       ACT OF 1934

For the Fiscal Year Ended:    DECEMBER 31, 1994
                          -----------------------------------------------------

                                       or

/  /  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:    1-5098
                       --------------------------------------------------------

                             VORNADO REALTY TRUST
- -------------------------------------------------------------------------------
             (Exact name of Registrant as specified in its charter)

               MARYLAND                                     22-1657560
- ---------------------------------------           -----------------------------
    (State or other jurisdiction of                      (I.R.S. Employer
     incorporation or organization)                   Identification Number)

PARK 80 WEST, PLAZA II, SADDLE BROOK, NEW JERSEY               07663
- ------------------------------------------------  -----------------------------
(Address of Principal Executive Offices)                     (Zip Code)

Registrant's telephone number including area code:      (201) 587-1000
                                                  -----------------------------

Securities registered pursuant to Section 12(b) of the Act:

                    Title of Each Class                           Name of Each Exchange on Which Registered
                    -------------------                           -----------------------------------------
                                                               
Common Shares of beneficial interest $.04 par value per share               New York Stock Exchange

       Securities registered pursuant to Section 12(g) of the Act:  NONE

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.    YES   X     NO
                                                -------    -------

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. /X/

The aggregate market value of the voting shares held by non-affiliates of the
registrant, i.e. by persons other than officers and trustees of Vornado Realty
Trust as reflected in the table in Item 12 of this Annual Report, at March 9,
1995 was $466,429,315.

As of March 9, 1995, there were 21,697,608 shares of the registrant's shares of
beneficial interest outstanding.

                                  Page 1 of 10
   2
THIS FORM 10-K/A AMENDS THE FOLLOWING ITEMS OF THE COMPANY'S ANNUAL REPORT ON
FORM 10-K PREVIOUSLY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH
23, 1995.

                               Table of Contents

                                                                                 
PART II.      6.      Selected Consolidated Financial Data                                 3

              7.      Management's Discussion and Analysis of Financial
                      Condition and Results of Operations                                  5

SIGNATURES                                                                                10

                                      -2-
   3
                                    PART II

ITEM 6.  SELECTED CONSOLIDATED FINANCIAL DATA

===============================================================================================================================
                                                                                        Year Ended
                                                            -------------------------------------------------------------------
                                                            December 31,      December 31,      December 31,      December 31,
                                                                    1994              1993              1992              1991
- -------------------------------------------------------------------------------------------------------------------------------
                                                                                                      
OPERATING DATA                                                     (in thousands, except share and per share amounts)
  Revenues:
    Property rentals                                            $ 70,755          $ 67,213          $ 63,186          $ 61,371
    Expense reimbursements                                        21,784            19,839            17,898            16,865
    Other income                                                   1,459             1,738               913               262
- -------------------------------------------------------------------------------------------------------------------------------
    Total Revenues                                                93,998            88,790            81,997            78,498
- -------------------------------------------------------------------------------------------------------------------------------
  Expenses:
   Operating                                                      30,223            27,994            27,587            25,848
   Depreciation and amortization                                   9,963             9,392             9,309             9,115
   General and administrative                                      6,495             5,890             4,612             4,770
   Costs incurred in connection with the merger
    Vornado, Inc. into Vornado Realty Trust                           --               856                --                --
   Cost incurred upon exercise of a stock option
    by an officer and subsequent repurchase of
    a portion of the shares                                           --                --            15,650                --
- -------------------------------------------------------------------------------------------------------------------------------
  Total Expenses                                                  46,681            44,132            57,158            39,733
- -------------------------------------------------------------------------------------------------------------------------------
  Operating income                                                47,317            44,658            24,839            38,765
  Interest and dividend income                                     7,489            11,620             8,555             9,303
  Interest and debt expense                                      (14,209)          (31,155)          (33,910)          (34,930)
  Net gain (loss) on marketable securities                           643               263             2,779             4,862
- -------------------------------------------------------------------------------------------------------------------------------
  Income from continuing operations before
   income taxes and extraordinary item                            41,240            25,386             2,263            18,000
  Provision (benefit) for income taxes                                --            (6,369)            1,080             7,527
- -------------------------------------------------------------------------------------------------------------------------------
  Income from continuing operations
   before extraordinary item                                    $ 41,240          $ 31,755          $  1,183          $ 10,473
===============================================================================================================================
  Weighted average number
   of shares outstanding                                      21,853,720        19,790,448        16,559,330        16,324,895
  Income per share from
   continuing operations                                        $   1.89          $   1.60          $    .07          $    .64
  Cash dividends declared                                           2.00              1.50*             1.15              1.08
* Does not include special dividend of $3.36 per share of accumulated earnings and profits paid in June 1993.
BALANCE SHEET DATA
  As at:
  Total assets                                                  $393,538          $385,830          $420,616          $393,447
  Real estate, at cost                                           365,832           340,415           314,651           305,123
  Accumulated depreciation                                       128,705           118,742           111,142           103,520
  Long-term debt                                                 234,160           235,037           341,701           345,608
  Shareholders' equity (deficit)                                 116,688           115,737            (3,242)            8,125
===============================================================================================================================

============================================================================================
                                                              Year Ended       Eleven Months
                                                            ------------           Ended
                                                            December 31,        December 31,
                                                                1990 (1)          1990 (1)
- --------------------------------------------------------------------------------------------
                                                                         
OPERATING DATA                                                  (in thousands, except
                                                                  per share amounts)
  Revenues:
    Property rentals                                            $ 58,524          $ 53,768
    Expense reimbursements                                        16,938            15,468
    Other income                                                     111               111
- --------------------------------------------------------------------------------------------
    Total Revenues                                                75,573            69,347
- --------------------------------------------------------------------------------------------
  Expenses:
   Operating                                                      25,393            23,101
   Depreciation and amortization                                   8,491             7,824
   General and administrative                                      6,121             5,527
   Costs incurred in connection with the merger
    Vornado, Inc. into Vornado Realty Trust                           --                --
   Cost incurred upon exercise of a stock option
    by an officer and subsequent repurchase of
    a portion of the shares                                           --                --
- --------------------------------------------------------------------------------------------
  Total Expenses                                                  40,005            36,452
- --------------------------------------------------------------------------------------------
  Operating income                                                35,568            32,895
  Interest and dividend income                                    12,125            11,051
  Interest and debt expense                                      (35,120)          (32,189)
  Net gain (loss) on marketable securities                        (1,836)               (3)
- --------------------------------------------------------------------------------------------
  Income from continuing operations before
   income taxes and extraordinary item                            10,737            11,754
  Provision (benefit) for income taxes                             4,414             4,827
- --------------------------------------------------------------------------------------------
  Income from continuing operations
   before extraordinary item                                    $  6,323          $  6,927
============================================================================================
  Weighted average number
   of shares outstanding                                      16,357,643        16,357,643
  Income per share from
   continuing operations                                        $    .39          $    .42
  Cash dividends declared                                            .27               .27
* Does not include special dividend of $3.36 per share of accumulated earnings and profits
  paid in June 1993.
BALANCE SHEET DATA
  As at:
  Total assets                                                  $387,866          $387,866
  Real estate, at cost                                           303,511           303,511
  Accumulated depreciation                                       100,501           100,501
  Long-term debt                                                 357,459           357,459
  Shareholders' equity (deficit)                                  15,421            15,421
============================================================================================

                                      -3-
   4
ITEM 6.  SELECTED CONSOLIDATED FINANCIAL DATA - (continued)

===============================================================================================================================
                                                                                        Year Ended
                                                            -------------------------------------------------------------------
                                                            December 31,      December 31,      December 31,      December 31,
                                                                    1994              1993              1992              1991
- -------------------------------------------------------------------------------------------------------------------------------
                                                                                                      
OTHER DATA
  Funds from operations (2) (3):
    Income from continuing operations before income
     taxes and extraordinary item                               $ 41,240          $ 25,386          $  2,263          $ 18,000
      Depreciation and amortization of real property               9,192             8,842             8,778             8,604
      Straight-lining of rental income                            (2,181)           (2,200)           (2,200)           (2,200)
      (Gains)/losses on sale of securities available
       for sale                                                      (51)             (263)             (846)           (1,932)
      Costs incurred in connection with
       the merger/upon exercise of a stock option                     --               856            15,650                --
- -------------------------------------------------------------------------------------------------------------------------------
    Funds from operations                                       $ 48,200          $ 32,621          $ 23,645          $ 22,472
===============================================================================================================================
    Cash flow provided by (used in):
      Operating activities                                      $ 46,948          $ 27,725          $ 17,607          $ 36,244
===============================================================================================================================
      Investing activities                                      $(15,434)         $  1,350          $ 14,800          $(17,214)
===============================================================================================================================
      Financing activities                                      $(32,074)         $(56,433)         $  4,384          $ (9,815)
===============================================================================================================================

============================================================================================
                                                              Year Ended       Eleven Months
                                                            ------------           Ended
                                                            December 31,        December 31,
                                                                1990 (1)          1990 (1)
- --------------------------------------------------------------------------------------------
                                                                         
OTHER DATA
  Funds from operations (2) (3):
    Income from continuing operations before income
     taxes and extraordinary item                               $ 10,737         $ 11,754
      Depreciation and amortization of real property               8,123            7,392
      Straight-lining of rental income                            (2,109)          (1,933)
      (Gains)/losses on sale of securities available
       for sale                                                    3,295            1,443
      Costs incurred in connection with
       the merger/upon exercise of a stock option                     --               --
- -------------------------------------------------------------------------------------------
    Funds from operations                                       $ 20,046         $ 18,656
===========================================================================================
    Cash flow provided by (used in):
      Operating activities                                      $ (3,163)        $ (2,900)
===========================================================================================
      Investing activities                                      $(70,805)        $(70,805)
==========================================================================================
      Financing activities                                      $ (6,200)        $ (5,683)
===========================================================================================

(1) In 1990, the Company changed to a calendar year end from a fiscal year
ending on the last Saturday in January.  The amounts for the year ended December
31, 1990 are included for comparative purposes only.

(2) Funds from operations does not represent cash generated from operating
activities in accordance with generally accepted accounting principles and is
not necessarily indicative of cash available to fund cash needs.  Funds from
operations 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.

(3) Effective January 1, 1995, the Company changed its definition of funds from
operations to exclude amortization of debt issuance costs and depreciation of
personal property.  Prior period amounts have been restated to conform to the
current year's presentation.  The Company's definition of funds from operations
does not conform to the NAREIT definition because the Company deducts the effect
of straight-lining of property rentals.

Amounts included in revenues and expenses have been reclassified to conform with
the current year's presentation.

                                      -4-
   5
ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS
===============================================================================
RESULTS OF OPERATIONS
  YEARS ENDED DECEMBER 31, 1994
  AND DECEMBER 31, 1993

The Company's revenues, which consist of property rentals, tenant expense
reimbursements and other income were $93,998,000 in 1994, compared to
$88,790,000 in 1993, an increase of $5,208,000 or 5.9%.

Property rentals from shopping centers were $63,778,000 in 1994, compared to
$60,919,000 in 1993, an increase of $2,859,000 or 4.7%.  This increase resulted
from rental step-ups in leases which are not subject to the straight-line method
of revenue recognition of $1,700,000 and $1,300,000 of rents from tenants at
expansions of shopping centers.  Property rentals from new tenants were
approximately the same as property rentals lost from vacating tenants. Property
rentals from the remainder of the portfolio were $6,090,000 in 1994 as compared
to $5,340,000 in 1993, an increase of $750,000 or 14.0%.  This increase resulted
primarily from property rentals received from new tenants exceeding property
rentals lost from vacating tenants.  Percentage rent was $887,000 in 1994 as
compared to $954,000 in 1993.

Tenant expense reimbursements were $21,784,000 in 1994, compared to $19,839,000
in 1993, an increase of $1,945,000.  This increase reflects a corresponding
increase in operating expenses passed through to tenants.

Other income was greater in 1993 than in 1994 primarily as a result of
reimbursements recognized under the Company's leasing agreement with Alexander's
in 1993.

Operating expenses were $30,223,000 in 1994 as compared to $27,994,000 in 1993,
an increase of $2,229,000.  This increase resulted primarily from an increase in
real estate taxes, snow removal costs and other common area maintenance charges.

Depreciation and amortization expense increased in 1994 primarily as a result of
the completion of property expansions.

General and administrative expenses were $6,495,000 in 1994 as compared to
$5,890,000 in 1993, an increase of $605,000.  This increase resulted from higher
professional fees and payroll.

Investment income from cash and cash equivalents, and marketable securities, net
of amounts due for U.S. Treasury obligations (collectively, "Liquid
Investments"), was $8,132,000 in 1994 compared to $11,883,000 in 1993, a
decrease of $3,751,000 or 31.6%.  The change in investment income resulted
primarily from a decrease in interest and dividend income of $4,131,000 as a
result of lower average investments due to the use of approximately $100,000,000
to reduce debt in November 1993, partially offset by an increase in net gains on
marketable securities.

Interest and debt expense was $14,209,000 in 1994 as compared to $31,155,000 in
1993, a decrease of $16,946,000 or 54.3%.  Of this decrease, (i) $14,586,000
resulted from the refinancing of a blanket mortgage loan (see Note 6), and (ii)
$1,300,000 resulted from an increase in  capitalized interest during
construction.

The Company operates in a manner intended to enable it to continue to qualify as
a real estate investment trust ("REIT") under Sections 856-860 of the Internal
Revenue Code of 1986 as amended (the "Code").  Under those sections, a REIT
which distributes at least 95% of its REIT taxable income to its shareholders
each year and which meets certain other conditions will not be taxed on that
portion of its taxable income which is distributed to its shareholders.  The
Company has distributed to its shareholders an amount greater than its taxable
income.  Therefore, no provision for Federal income taxes is required.  In 1993,
as a result of the Company's conversion to a REIT, the deferred tax balance of
$6,369,000 at December 31, 1992 was reversed.

RESULTS OF OPERATIONS
  YEARS ENDED DECEMBER 31, 1993
  AND DECEMBER 31, 1992

The Company's revenues, which consist of property rentals, tenant expense
reimbursements and other income were $88,790,000 in 1993, compared to
$81,997,000 in 1992, an increase of $6,793,000 or 8.3%.

                                      -5-
   6
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS - (continued)
================================================================================
Property rentals from shopping centers were $60,919,000 in 1993, compared to
$56,185,000 in 1992, an increase of $4,734,000 or 8.4%.  This increase resulted
from rental step-ups in existing tenant leases which are not subject to the
straight-line method of revenue recognition of $2,061,000 and property rentals
received from new tenants exceeding property rentals lost from vacating tenants.
Property rentals from the remainder of the portfolio were $5,340,000 in 1993 as
compared to $6,316,000 in 1992, a decrease of $976,000 or 15.4%.  Of this
decrease (i) $477,000 resulted from the closing of the outlet department store
at the Company's Watchung, New Jersey location on June 1, 1993 as part of a
redevelopment plan (see Liquidity and Capital Resources) and (ii) $499,000
resulted from the excess of property rentals lost from vacating tenants over
property rentals received from new tenants.  Percentage rent was $954,000 in
1993 as compared to $685,000 in 1992.

Tenant expense reimbursements were $19,839,000 in 1993, compared to $17,898,000
in 1992, an increase of $1,941,000.  This increase relates to a corresponding
increase in operating expenses passed through to tenants and reimbursements from
tenants under leases which commenced subsequent to January 1, 1992.

Other income increased as a result of  reimbursements of $750,000 recognized in
1993 under the Company's leasing agreement with Alexander's and a full year of
management fees received from Interstate Properties in 1993 as compared to a
partial year in 1992.

Operating expenses were $27,994,000 in 1993 as compared to $27,587,000 in 1992,
an increase of $407,000.  This increase resulted primarily from a rise in real
estate taxes offset by savings of $500,000 in connection with the closing of the
abovementioned outlet department store.

Depreciation and amortization expense for 1993 did not change significantly from
1992.

General and administrative expenses were $5,890,000 in 1993 as compared to
$4,612,000 in 1992, an increase of $1,278,000.  This increase resulted from
increases in (i) payroll of $500,000, of which $300,000 was applicable to
employees added in connection with the management of Interstate Properties (see
other income above), (ii) professional fees of $408,000 and (iii) general
corporate office expenses of $370,000.

In connection with the merger of Vornado, Inc. into Vornado Realty Trust, the
Company incurred costs of $856,000.

The Company recorded an expense of $15,650,000 in 1992 upon the exercise of a
stock option by an officer and the subsequent repurchase of a portion of the
shares.

Investment income from Liquid Investments was $11,883,000 in 1993 compared to
$11,334,000 in 1992, an increase of $549,000 or 4.8%.  The change in investment
income resulted primarily from an increase in interest and dividend income of
$3,065,000 offset by a decrease in net gains on the sale of marketable
securities of $2,516,000 (including $1,932,000 from the Company's former
investment in a limited partnership, which was liquidated at December 31, 1992
at book value for cash).  Of the increase in interest and dividend income,
$1,912,000 was attributable to interest income earned on the net proceeds from
the issuance of 5,211,700 common shares of beneficial interest in May 1993, net
of a distribution of accumulated earnings and profits and working capital used
to prepay a blanket mortgage loan.  The balance of the increase resulted from
the mix of other investments.

Interest and debt expense was $31,155,000 in 1993 as compared to $33,910,000 in
1992, a decrease of $2,755,000 or 8.1%.  Of this decrease, (i) $1,600,000
resulted from the refinancing of a blanket mortgage loan (see Note 6), and (ii)
$282,000 was due to an increase in capitalized interest during construction.

                                      -6-
   7
ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS - (continued)
================================================================================
LIQUIDITY AND CAPITAL RESOURCES

YEAR ENDED DECEMBER 31, 1994

Cash flows provided by operating activities of $46,948,000 was comprised of: (i)
net income of $41,240,000, and (ii) adjustments for non-cash items of
$8,015,000, less (iii) the net change in operating assets and liabilities of
$2,307,000.  The adjustments for non-cash items are primarily comprised of
depreciation and amortization of $10,839,000, offset by the effect of
straight-lining of rental income of $2,181,000.

Net cash used in investing activities of $15,434,000 was comprised of capital
expenditures of $25,417,000, offset by proceeds from the sale of securities
available for sale of $9,983,000.

Net cash used in financing activities of $32,074,000 was primarily comprised of
dividends paid of $43,236,000, offset by borrowings on U.S. Treasury obligations
of $11,428,000.

YEAR ENDED DECEMBER 31, 1993

Cash flows provided by operating activities of $27,725,000 was primarily
comprised of:  (i) net income of $31,755,000 less (ii) adjustments for non-cash
items of $599,000 and the net change in operating assets and liabilities of
$2,831,000.  The adjustments for non-cash items are primarily comprised of
depreciation and amortization of $11,435,000, offset by (i) the effect of
straight-lining of rental income of $2,200,000, (ii) the reversal of deferred
income taxes of $6,369,000, and (iii) the loss on the early extinguishment of
debt of $3,202,000.

Net cash provided by investing activities of $1,350,000 was comprised of net
proceeds from the sale of securities available for sale of $28,336,000, offset
by capital expenditures of $26,986,000.

Net cash used in financing activities of $56,433,000 was primarily comprised of
(i) debt repayments of $333,664,000, net of proceeds from borrowings of
$227,000,000, less $5,247,000 of deferred debt expenses incurred therewith (ii)
dividends paid to shareholders of $84,482,000 (including a special dividend of
$54,022,000 of accumulated earnings and profits, as determined for federal
income tax purposes), and (iii) repayment of borrowings on U.S. Treasury
obligations of $30,048,000, offset by (iv) net proceeds from issuance of common
shares of $172,051,000.

YEAR ENDED DECEMBER 31, 1992

Cash flows provided by operating activities of $17,607,000 was comprised of: (i)
net income of $1,183,000, (ii) adjustments for non-cash items of $7,291,000,
(iii) net cash from discontinued operations of $2,276,000 and (iv) the net
change in operating assets and liabilities of $6,857,000.  The adjustments for
non-cash items are primarily comprised of depreciation and amortization of
$11,470,000, offset by the effect of straight-lining of rental income of
$2,200,000 and a net gain on marketable securities of $2,779,000.

Net cash provided by investing activities of $14,800,000 was comprised of net
proceeds from the sale of securities available for sale of $26,015,000, offset
by capital expenditures of $11,215,000.

Net cash provided by financing activities of $4,384,000 was primarily comprised
of borrowings on U.S. Treasury obligations of $28,719,000 and proceeds from the
exercise of stock options of $4,825,000, offset by (i) dividends paid of
$17,541,000, (ii) net loans to officers of $7,623,000 and (iii) net payments on
borrowings of $3,907,000.

                                      -7-
   8
ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS - (continued)
==============================================================================

LIQUIDITY AND CAPITAL RESOURCES

Management considers funds from operations an appropriate supplemental measure
of the Company's operating performance.  Funds from operations were $48,200,000
in 1994, compared to $32,621,000 in 1993, an increase of $15,579,000 or 47.8%.
The following table reconciles funds from operations and net income:

                                            Year Ended Dec. 31,
                                    -------------------------------------
                                       1994                     1993
                                    -----------              -----------
                                                       
Net income                          $41,240,000              $25,386,000
Depreciation and
  amortization of
  real property                       9,192,000                8,842,000
Straight-lining of
  property rentals                   (2,181,000)              (2,200,000)
Gain on sale of
  securities available
  for sale                              (51,000)                (263,500)
Cost incurred in
  connection with
  merger/upon
  exercise of
  stock option                                                   856,000
                                    -----------              -----------
Funds from
  operations *                      $48,200,000              $32,621,000
                                    ===========              ===========

    *  Effective January 1, 1995, the Company changed its definition of funds
    from operations to exclude amortization of debt issuance costs and
    depreciation of personal property.  Prior period amounts have been restated
    to conform to the current year's presentation.  The Company's definition of
    funds from operations does not conform to the NAREIT definition because the
    Company deducts the effect of the straight-lining of property rentals.

Funds from operations does not represent cash generated from operating
activities in accordance with generally accepted accounting principles and is
not necessarily indicative of cash available to fund cash needs.  Funds from
operations 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.  Below are the cash flows provided by (used in)
operating, investing and financing activities:

                                             Year Ended Dec. 31,
                                    -------------------------------------
                                        1994                     1993
                                    ------------             ------------
                                                       
Operating activities                $ 46,948,000             $ 27,725,000
                                    ============             ============

Investing activities                $(15,434,000)            $  1,350,000
                                    ============             ============

Financing activities                $(32,074,000)            $(56,433,000)
                                    ============             ============

The major items of capital expenditures for 1994 were (i) $11,400,000 for
expansions in three  shopping centers, (ii) $3,900,000 for the acquisition of a
building in Philadelphia, Pennsylvania and (iii) $2,100,000 for the tenant
improvements at the Company's retail property at 14th Street in Manhattan, New
York.  The Company has budgeted approximately $13,500,000 for investment over
the next two years of which $10,000,000 is for future expansions and $2,000,000
is for tenant improvements at the Company's retail property in Philadelphia,
noted above.  In addition, the Company will continue its program of upgrading
its shopping centers by  refurbishing its parking lots (including resurfacing,
new lighting, updated landscaping, islands and curbing) and re-roofing of
buildings, the cost of which will be substantially reimbursed by tenants in
accordance with existing lease terms.

In July 1992, the Company was retained by Alexander's Inc. to act as a special
real estate consultant.  The Company is due approximately $12,400,000 for
transactions completed to date.  Of this amount, the Company was due to receive
$500,000 on July 1, 1994 but has not received such payment.  The balance of
$11.9 million will be payable over a seven year period in an amount not to
exceed $2,500,000 in any calendar year until the present value of such
installments (calculated at a discount rate of 9% per annum) equals the amount
that would have been paid had it been paid on September 21, 1993 or at the time
the  transactions which gave rise to the commissions occurred, if later.  Such
receipts are subject to payment of rents by the underlying tenants pursuant to
the leases and to the prior satisfaction of all payments to which certain
creditors of Alexander's are entitled under the plan of reorganization confirmed
by such creditors (see Notes 13-D and 17).

                                      -8-
   9
ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS - (continued)
==============================================================================

On March 2, 1995, following bankruptcy court approval of the loan and management
arrangements described below, the Company purchased all of the 1,353,468 shares
of common stock of Alexander's, Inc. ("Alexander's") owned by Citibank, N.A.
("Citibank") for $40.50 per share in cash (the "Acquisition"), representing
27.1% of the outstanding common stock of Alexander's.  After the Acquisition,
the Company owns 29.3% of the outstanding shares of common stock of Alexander's.
Interstate Properties, which owns 31% of the common shares of beneficial
interest of the Company, currently owns 27.1% of the outstanding shares of
Alexander's common stock.

The Company and Alexander's have entered into a three year management and
development agreement (the "Management Agreement") under which the Company has
agreed to manage all Alexander's business affairs and manage and develop
Alexander's properties for an annual fee of $3,000,000; plus 6% of development
costs with a minimum guaranteed fee for the development portion of $1,650,000 in
the first year and $750,000 in each of the second and third years.

The fees pursuant to the Management Agreement discussed above, are in addition
to leasing fees the Company receives from Alexander's under a leasing agreement
in effect since 1992.  The term of the leasing agreement has been extended to be
co-terminus with the term of the Management Agreement.

On March 15, 1995, the Company and a bank lent Alexander's $75,000,000 in a
secured financing, of which $45,000,000 was funded by the Company and the
balance was funded by the bank.  The Company's loan, which is subordinate to
that of the bank, has a three year term and bears interest at 16.43% per annum
for the first two years and at a fixed rate for the third year of 992 basis
points over one year treasury bills.  In addition, Alexander's paid a loan
origination fee of $1,500,000 to the Company.

On February 27, 1995, the Company entered into a three year unsecured revolving
credit facility with a bank providing for borrowings of up to $75,000,000.
Borrowings bear annual interest, at the Company's election, at Libor plus 1.50%
or the higher of the federal funds rate plus 1% or prime rate plus .50%.  At
March 15, 1995, the Company had borrowed $60,000,000 under the agreement.

In May 1994, the Company's shelf registration statement relating to $350,000,000
of securities became effective.

The Company anticipates that cash from continuing operations, working capital,
borrowings under its revolving credit facility and/or proceeds from the issuance
of securities under the Company's shelf registration statement will be adequate
to fund its business operations, capital expenditures, continuing debt service
obligations, the payment of dividends and the Alexander's transactions noted
above.

ECONOMIC CONDITIONS

Substantially all of the Company's leases contain step-ups in rent.  Such rental
increases are not designed to, and in many instances do not, approximate the
cost of inflation, but do have the effect of mitigating the adverse impact of
inflation.  In addition, substantially all of the Company's leases contain
provisions that require the tenant to reimburse the Company for the tenant's
share of common area charges (including roof and structure, unless it is the
tenant's direct responsibility) and real estate taxes thus passing through to
the tenants the effects of inflation on such expenses.

Inflation did not have a material effect on the Company's results for the
periods presented.

RECENTLY ISSUED ACCOUNTING STANDARDS

In May 1993, the Financial Accounting Standards Board adopted Statement No. 114,
"Accounting by Creditors for Impairment of a Loan".  The statement is effective
for fiscal years beginning after December 15, 1994.  The Company believes that
this pronouncement will not have a material effect on its financial condition or
results of operation.

In October 1994, the Financial Accounting Standards Board adopted Statement No.
118, "Accounting by Creditors for Impairment of a Loan--Income Recognition and
Disclosures".  The statement is effective for fiscal years beginning after
December 15, 1994.  The Company believes that this pronouncement will not have a
material effect on its financial condition or results of operation.

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   10
                              VORNADO REALTY TRUST

                                   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.

                                        VORNADO REALTY TRUST
                               ------------------------------------
                                            (Registrant)

Date:  December 20, 1995                 /s/Joseph Macnow
                               ------------------------------------
                                          JOSEPH MACNOW
                                 Vice President - Chief Financial
                               Officer and Chief Accounting Officer

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