AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 2, 2000
                                                      REGISTRATION NO. 333-
________________________________________________________________________________
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                              -------------------

                                    FORM S-3
                             REGISTRATION STATEMENT
                                     UNDER
                           THE SECURITIES ACT OF 1933
                              -------------------

                              VORNADO REALTY TRUST
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
                              -------------------

                                                  
                     MARYLAND                                            22-1657560
          (STATE OR OTHER JURISDICTION OF                   (IRS EMPLOYER IDENTIFICATION NUMBER)
          INCORPORATION OR ORGANIZATION)
                                                                        JOSEPH MACNOW
              PARK 80 WEST, PLAZA II                               PARK 80 WEST, PLAZA II
          SADDLE BROOK, NEW JERSEY 07663                       SADDLE BROOK, NEW JERSEY 07663
                  (201) 587-1000                                       (201) 587-1000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,      (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE
  INCLUDING AREA CODE, OF REGISTRANT'S EXECUTIVE     NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
                     OFFICES)

                              -------------------

                                   COPIES TO:

                             ALAN SINSHEIMER, ESQ.
                              SULLIVAN & CROMWELL
                                125 BROAD STREET
                            NEW YORK, NEW YORK 10004
                              -------------------

    APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement as determined by
market conditions.
    If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
    If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [x]
    If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
    If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
    If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
                              -------------------

                        CALCULATION OF REGISTRATION FEE

                                                                   PROPOSED
                                                                    MAXIMUM       PROPOSED
                                                                   AGGREGATE      MAXIMUM
                 TITLE OF SHARES                    AMOUNT TO      PRICE PER     AGGREGATE            AMOUNT OF
                TO BE REGISTERED                   BE REGISTERED   SHARE(2)    OFFERING PRICE(2)   REGISTRATION FEE
                                                                                       
Common shares of beneficial interest, par value
  $0.04 per share(1).............................    7,032,750      $34.50      $242,629,875          $64,055

(1) This Registration Statement registers the common shares of beneficial
    interest, par value $0.04 per share, of Vornado Realty Trust ('Vornado')
    issuable if Vornado elects to issue common shares to holders of up to
    7,032,750 class A units of limited partnership interest in Vornado Realty
    L.P. (the 'Operating Partnership') upon the tender of such units for
    redemption. 1,353,204 such units were issued by the Operating Partnership in
    connection with its acquisition of equity interests in certain limited
    partnerships. 4,998,000 series E-1 units, redeemable for 5,679,546 class A
    units, were issued by the Operating Partnership in connection with its
    acquisition of the land under certain Charles E. Smith Commercial Realty,
    L.P. office properties in Crystal City, Arlington, Virginia, and partnership
    interests in certain subsidiaries of Charles E. Smith Commercial Realty,
    L.P. This Registration Statement also relates to such additional common
    shares as may be issued as a result of certain adjustments including,
    without limitation, share dividends and share splits.
(2) Estimated solely for purposes of calculating the registration fee in
    accordance with Rule 457(c) based on the average of the high and low
    reported sales prices on the New York Stock Exchange on April 25, 2000.
                              -------------------
    THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.

________________________________________________________________________________

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IT IS NOT THE SOLICITATION OF AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

                             SUBJECT TO COMPLETION
                  PRELIMINARY PROSPECTUS DATED MAY 2, 2000

PROSPECTUS

                              VORNADO REALTY TRUST
                            7,032,750 COMMON SHARES

    We are a fully-integrated real estate investment trust. We may issue up to
7,032,750 common shares to holders of up to 7,032,750 class A units of limited
partnership interest in Vornado Realty L.P. upon tender of those units for
redemption. Up to 5,679,546 of these class A units are currently represented by
4,998,000 series E-1 units that may be converted into class A units commencing
May 1, 2000. Vornado Realty L.P. is the operating partnership through which we
own our assets and operate our business.

    The units that may be redeemed for common shares were issued in connection
with the acquisition of

     equity interests in certain limited partnerships; and

     the land under certain Charles E. Smith Commercial Realty, L.P. office
     properties in Crystal City, Arlington, Virginia, and partnership interests
     in certain subsidiaries of Charles E. Smith Commercial Realty, L.P.

    We are required to register the 7,032,750 common shares pursuant to
registration rights agreements with the holders of those units. We will acquire
units from the redeeming unit holders in exchange for any common shares that we
issue. We have registered the issuance of the common shares to permit their
holders to sell them without restriction in the open market or otherwise, but
the registration of the shares does not necessarily mean that any holders will
elect to redeem their units. Also, upon any redemption, we may elect to pay cash
for the units tendered rather than issue common shares. Although we will incur
expenses in connection with the registration of the 7,032,750 common shares, we
will not receive any cash proceeds upon their issuance.

    The common shares are listed on the New York Stock Exchange under the symbol
'VNO.'

    In order to maintain our qualification as a real estate investment trust for
federal income tax purposes and for other purposes, no person may own more than
6.7% of the outstanding common shares. Shares owned in excess of this limit will
be deemed 'excess shares' under the declaration of trust. The holder of any
excess shares will lose some ownership rights with respect to these shares, and
we will have the right to purchase them from the holder.

    SEE 'RISK FACTORS' BEGINNING ON PAGE 4 FOR INFORMATION ABOUT FACTORS
RELEVANT TO AN INVESTMENT IN THE COMMON SHARES.

    Neither the Securities and Exchange Commission nor any other regulatory body
has approved or disapproved of these securities or passed upon the accuracy or
adequacy of this prospectus. Any representation to the contrary is a criminal
offense.

               The date of this prospectus is             , 2000.

    YOU SHOULD RELY ONLY ON THE INFORMATION INCORPORATED BY REFERENCE OR
PROVIDED IN THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT. WE HAVE NOT AUTHORIZED
ANYONE ELSE TO PROVIDE YOU WITH DIFFERENT INFORMATION. WE ARE NOT MAKING AN
OFFER OF THESE SECURITIES IN ANY STATE WHERE THE OFFER IS NOT PERMITTED. YOU
SHOULD NOT ASSUME THAT THE INFORMATION IN THIS PROSPECTUS OR ANY PROSPECTUS
SUPPLEMENT IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON THE FRONT OF THOSE
DOCUMENTS.

    When we say 'we,' 'our,' 'us' or 'Vornado,' we mean Vornado Realty Trust and
its consolidated subsidiaries, except where we make it clear that we mean only
the parent company. When we say the 'operating partnership,' we mean Vornado
Realty L.P. When we say 'you' without any further specification, we mean the
holders of units that were issued in connection with our acquisition of:

     equity interests in certain limited partnerships; and

     the land under certain Charles E. Smith Commercial Realty, L.P. office
     properties in Crystal City, Arlington, Viriginia, and partnership interests
     in certain subsidiaries of Charles E. Smith Commercial Realty, L.P.

                      WHERE YOU CAN FIND MORE INFORMATION

    We file annual, quarterly and special reports, proxy statements and other
information with the SEC. Our SEC filings are available to the public over the
Internet at the SEC's web site at http://www.sec.gov. You may also read and copy
any document we file at the SEC's public reference rooms in Washington, D.C.,
New York, New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330
for further information on the public reference rooms. Our filings with the SEC
are also available to the public through the SEC's Internet site at
http://www.sec.gov and through the NYSE, 20 Broad Street, New York, New York
10005, on which our common stock is listed.

    This prospectus is part of a registration statement on Form S-3 filed by
Vornado with the SEC under the Securities Act. As permitted by the rules and
regulations of the SEC, this prospectus omits some of the information contained
in the registration statement. You should read the registration statement and
related exhibits for further information about Vornado and the common shares
offered by this prospectus. Statements in this prospectus about the provisions
of any document filed as an exhibit to the registration statement or otherwise
filed with the SEC are only summaries, and in each instance you should read the
document so filed for complete information about its provisions. Each statement
in this prospectus about the provisions of any document filed with the SEC is
qualified in its entirety by reference to the document.

    The SEC allows us to 'incorporate by reference' the information we file with
them, which means that we can disclose important information to you by referring
you to those documents. The information incorporated by reference is an
important part of this prospectus, and information that we file later with the
SEC will automatically update and supersede this information. We incorporate by
reference our Annual Report on Form 10-K for the year ended December 31, 1999

                                       2

and any future filings made with the SEC under Sections 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934 until we sell all of the
securities.

    You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address:

   Vornado Realty Trust
    Park 80 West, Plaza II
    Saddle Brook, New Jersey 07663
    (201) 587-1000
    Attn: Secretary

                           FORWARD-LOOKING STATEMENTS

    This prospectus includes and incorporates by reference forward-looking
statements. We have based these forward-looking statements on our current
expectations and projections about future events. Various factors could cause
our actual results to differ materially from the results described in the
forward-looking statements. Factors that might cause a material difference of
this kind include, but are not limited to:

     changes in the general economic climate;

     local conditions such as an oversupply of space or a reduction in demand
     for real estate in the area;

     conditions of our tenants;

     competition from other available space;

     increased operating costs and interest expense;

     the timing of and costs associated with property improvements;

     changes in taxation or zoning laws;

     government regulations;

     our failure to continue to qualify as a real estate investment trust;

     availability of financing on acceptable terms;

     potential liability under environmental or other laws or regulations; and

     general competitive factors.

    We undertake no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
See 'Risk factors' for more information about some of these factors.

                                       3

                                  RISK FACTORS

    You should carefully consider, among other factors, the matters described
below.

IF YOU REDEEM YOUR UNITS, YOU MAY INCUR ADVERSE TAX CONSEQUENCES AND THE NATURE
OF YOUR INVESTMENT WILL CHANGE.

YOU SHOULD CAREFULLY CONSIDER THE TAX CONSEQUENCES OF REDEEMING YOUR UNITS.

    The exercise of your right to require the redemption of your units will be
treated for tax purposes as a sale of your units. This sale will be fully
taxable to you, and you will be treated as realizing for tax purposes an amount
equal to the sum of the cash or the value of the common shares received in the
exchange plus the amount of the operating partnership liabilities (including the
operating partnership's share of the liabilities of certain entities in which
the operating partnership owns an interest) considered allocable to the redeemed
units at the time of the redemption. Depending upon your particular
circumstances, it is possible that the amount of gain recognized (or even the
tax liability resulting from that gain) could exceed the amount of cash and the
value of other property (e.g., the common shares) received upon the disposition.
See 'Redemption of units -- Tax consequences of redemption' for more information
on these tax consequences.

THE NATURE OF YOUR INVESTMENT WILL CHANGE UPON A REDEMPTION OF YOUR UNITS.

    Unless we elect to assume and perform the operating partnership's obligation
with respect to redeeming your units, you will receive cash on the specified
redemption date (for class A units, which are the kind of units that you hold,
this is generally the tenth business day after we receive your notice of
redemption if our common shares are publicly traded) from the operating
partnership in an amount equal to the market value of the units to be redeemed.
In lieu of the operating partnership's acquiring the units for cash, we have the
right (except as described below, if the common shares are not publicly traded)
to elect to acquire the units on the specified redemption date directly from
you, in exchange for either cash or common shares, and upon acquiring the units,
we will become the owner of your units. See 'Redemption of units' for more
information about our right to acquire your units for either cash or common
shares when you redeem them. If you receive cash, you will no longer have any
interest in the operating partnership or Vornado and will not benefit from any
subsequent increases in the price of the common shares and will not receive any
future distributions from the operating partnership or Vornado (unless you
currently own or acquire in the future additional common shares or units). If
you receive common shares, you will become a shareholder of Vornado rather than
a holder of units in the operating partnership. Although an investment in common
shares is substantially equivalent to an investment in units in the operating
partnership, there are some differences between ownership of units and ownership
of common shares.

                                       4

    These differences, some of which may be material to you, are discussed in
'Comparison of ownership of units and common shares.'

REAL ESTATE INVESTMENTS' VALUE AND INCOME FLUCTUATE DUE TO VARIOUS FACTORS,
INCLUDING THOSE DESCRIBED BELOW.

THE VALUE OF REAL ESTATE FLUCTUATES DEPENDING ON CONDITIONS IN THE GENERAL
ECONOMY AND THE REAL ESTATE BUSINESS. THESE CONDITIONS MAY ALSO LIMIT OUR
REVENUES AND AVAILABLE CASH.

The factors that affect the value of our real estate include, among other
things:

     national, regional and local economic conditions;

     oversupply of competing properties in a property's area;

     reduced demand for space in a property's area;

     whether tenants consider a property attractive;

     how well we manage our properties;

     competition from comparable properties;

     whether we are able to collect rent from tenants;

     any bankruptcies of our major tenants;

     increases or decreases in market rental rates;

     how much it costs us to repair, renovate and rent space, including
     substantial costs of tenant improvements and leasing expenses to release
     office space;

     increases in operating costs due to inflation, increased real estate taxes
     and other factors;

     whether we are able to pass some or all of our increased operating costs
     through to tenants;

     government regulations and changes in zoning or tax laws;

     market interest rates;

     whether we are able to obtain financing and the terms of our financing; and

     our potential liability for environmental or other legal claims.

    The rents we receive and the occupancy levels at our properties might
decline as a result of changes in any of these factors. If our rental revenues
decline, we might have less cash available to distribute to our shareholders. In
addition, some of our major expenses, including mortgage payments, real estate
taxes and maintenance costs, generally do not decline when the related rents
decline. If rents decline while costs remain the same, our income and funds
available for distribution to our shareholders would decline.

                                       5

WE DEPEND ON LEASING SPACE TO TENANTS ON ECONOMICALLY FAVORABLE TERMS AND
COLLECTING RENT FROM OUR TENANTS, WHO MAY NOT BE ABLE TO PAY.

    Our financial results depend on leasing space in our real estate properties
to tenants on economically favorable terms. In addition, because substantially
all of our income comes from rentals of real property, our income and funds
available for distribution to our shareholders will decrease if a significant
number of our tenants cannot pay their rent. If a tenant does not pay its rent,
we might not be able to enforce our rights as landlord without delays and we
might incur substantial legal costs. See ' Bankruptcy of tenants may decrease
our revenues and available cash' for information about the bankruptcy and
court-approved reorganization of Bradlees Inc., one of our tenants, and the
status of Bradlees' leases.

BANKRUPTCY OF TENANTS MAY DECREASE OUR REVENUES AND AVAILABLE CASH.

    A number of retail companies, including some of our tenants, have declared
bankruptcy in recent years, and other tenants may declare bankruptcy or become
insolvent in the future. If a major tenant declares bankruptcy or becomes
insolvent, the shopping centers where it leases space may have lower revenue and
operational difficulties, and we may have difficulty leasing the remainder of
the affected shopping centers. Our leases generally do not contain restrictions
designed to ensure the creditworthiness of the tenants. As a result, the
bankruptcy or insolvency of a major tenant could result in a lower level of
funds from operations available for distribution to our shareholders.

    In June 1995, Bradlees filed for protection under Chapter 11 of the U.S.
Bankruptcy Code. Bradlees emerged from bankruptcy in January 1999, when its plan
of reorganization was confirmed. We withdrew our objection to Bradlees' proposed
plan of reorganization after obtaining Bradlees' agreement that its lease of our
14th Street and Union Square property in New York City would terminate in March
2000. The lease was scheduled to expire in October 2019, and contained an option
to renew for an additional ten years. In addition, the rent under the lease was
increased by $1,100,000 per annum to $3,400,000 per annum from January 1999 to
the March 2000 termination date. As part of this agreement, we paid $11,000,000
to Bradlees. In January 2000, the lease was extended to March 15, 2002 and in
connection with this extension, the rent under the lease increased to $4,600,000
in March 2000 and will increase to $4,900,000 in March 2001. We are considering
various alternatives for the redevelopment of this site. We currently lease 15
other locations to Bradlees. Of these locations, the leases for 14 are fully
guaranteed by Stop & Shop Companies, Inc., a wholly-owned subsidiary of Royal
Ahold NV, a leading international food retailer, and one is guaranteed as to 70%
of the rent. If Bradlees or Stop & Shop fails to perform its obligations under
these leases, our rental revenues could decline and, as a result, our funds from
operations available for distribution to our shareholders could also decline.

                                       6

WE MAY ACQUIRE OR DEVELOP NEW PROPERTIES, AND THIS MAY CREATE RISKS.

    We may acquire or develop properties or acquire other real estate companies
when we believe that an acquisition or development matches our business
strategies. We might not succeed in consummating desired acquisitions or in
completing developments on time or within our budget. We also might not succeed
in leasing newly developed or acquired properties at rents sufficient to cover
their costs of acquisition or development and operations.

    We have experienced rapid growth in recent years, increasing our total
assets from approximately $565 million at December 31, 1996 to approximately
$5,479 million at December 31, 1999. We may continue this rapid growth for the
foreseeable future by acquiring or developing properties when we believe that
market circumstances and investment opportunities are attractive. We may not,
however, be able to manage our growth effectively or to maintain a similar rate
of growth in the future, and the failure to do so may have a material adverse
effect on our financial condition and results of operations.

    If persons selling properties to us wish to defer the payment of taxes on
the sales proceeds, we are likely to pay them in units of the operating
partnership. In transactions of this kind, we may also agree not to sell the
acquired properties or reduce the mortgage indebtedness on such property for
significant periods of time. If we borrow funds or assume indebtedness to
acquire or develop properties, the operating partnership's indebtedness as a
percentage of Vornado's asset value or market capitalization might increase. If
this happens, the increased leverage may impair our ability to take actions that
would otherwise be in the best interests of Vornado and our security holders. If
our indebtedness increases significantly, the operating partnership might not be
able to make required principal and interest payments with respect to
indebtedness. See also ' -- Vornado's organizational and financial structure
gives rise to operational and financial risks, including those described
below -- We have indebtedness, and this indebtedness may increase' for further
information about our leverage.

IT MAY BE DIFFICULT TO BUY AND SELL REAL ESTATE QUICKLY, AND TRANSFER
RESTRICTIONS APPLY TO SOME OF OUR MORTGAGED PROPERTIES.

    Equity real estate investments are relatively difficult to buy and sell
quickly. We therefore have limited ability to vary our portfolio promptly in
response to changes in economic or other conditions.

    Some of our properties are mortgaged to secure payment of indebtedness. If
we were unable to meet our mortgage payments, the lender could foreclose on the
properties and we could incur a loss. In addition, if we wish to dispose of one
or more of the mortgaged properties, we might not be able to obtain release of
the lien on such mortgaged property. If a lender forecloses on a mortgaged
property or if a mortgage lien prevents us from selling a property, our funds
available for distribution to our shareholders could decline. See 'Management's
Discussion and Analysis of Financial Condition and Results of Operations --
Liquidity and Capital Resources' in our Annual Report on Form 10-K for the year
ended December 31, 1999, and the Notes to the Consolidated Financial

                                       7

Statements in the same report for information regarding the mortgages on our
properties.

A SIGNIFICANT PROPORTION OF OUR PROPERTIES ARE IN THE NEW YORK CITY/NEW JERSEY
REGION AND ARE AFFECTED BY THAT REGION'S ECONOMIC CYCLE.

For the year ended December 31, 1999, 52% of our earnings before interest
expense, taxes, depreciation and amortization on a historical basis came from
properties located in the New York City metropolitan area and New Jersey. We
refer to earnings before interest expense, taxes, depreciation and amortization
as 'EBITDA.' In addition, we may concentrate a significant portion of our future
acquisitions in New York City and New Jersey. Like other real estate markets,
the real estate market in New York City and New Jersey experienced economic
downturns in the past, including most recently in the late 1980s and early
1990s. Future declines in the economy or the real estate markets in New York
City and New Jersey could hurt our financial performance and the value of our
properties. The factors affecting economic conditions in this region include:

     business layoffs or downsizing;

     industry slowdowns;

     relocations of businesses;

     changing demographics;

     increased telecommuting and use of alternative work places;

     financial performance and productivity of the publishing, financial,
     technology, retail, insurance and real estate industries;

     infrastructure quality; and

     any oversupply of or reduced demand for real estate.

The economy or the real estate markets in New York City and New Jersey might not
remain strong.

ALL OF OUR TEMPERATURE CONTROLLED LOGISTICS WAREHOUSES ARE LEASED TO ONE TENANT,
AND THAT TENANT MAY DEFER RENT IN SOME CIRCUMSTANCES.

    Vornado owns a 60% interest in partnerships that own 89 warehouse facilities
nationwide with an aggregate of approximately 428 million cubic feet of
refrigerated, frozen and dry storage space. Crescent Real Estate Equities
Company owns the other 40% interest in these partnerships. We refer to these
partnerships as the 'Vornado/Crescent Real Estate partnerships.' On March 12,
1999, the Vornado/Crescent Real Estate partnerships sold all of the non-real
estate assets encompassing the operations of the temperature controlled
logistics business for approximately $48,700,000 to a new partnership owned 60%
by Vornado Operating Company (which was spun off from Vornado in October 1998)
and 40% by Crescent Operating Inc. The new partnership conducts the temperature
controlled logistics business under the name AmeriCold Logistics. AmeriCold
Logistics leases the underlying temperature controlled logistics warehouses used
in this business from the Vornado/Crescent Real Estate

                                       8

partnerships that continue to own the real estate and manages 15 additional
warehouses containing approximately 91 million cubic feet. The leases generally
have a 15-year term with two five-year renewal options and provide for the
payment of fixed base rent and percentage rent based on customer revenues.
AmeriCold Logistics is required to pay for all costs arising from the operation,
maintenance and repair of the properties as well as property capital
expenditures in excess of $5,000,000 annually. Fixed base rent and percentage
rent amounted to $134 million for the period March 12, 1999 (the date when the
lease started) through December 31, 1999. AmeriCold Logistics has the right to
defer a portion of the rent for up to three years beginning on March 12, 1999 to
the extent that available cash, as defined in the leases, is insufficient to pay
such rent, and pursuant thereto, rent was deferred as of December 31, 1999, of
which Vornado's share was $3,240,000.

    To the extent that operations of AmeriCold Logistics may affect its ability
to pay rent and the amount of percentage rent due under the leases, Vornado
indirectly bears the risks associated with AmeriCold Logistics' temperature
controlled logistics business. That business faces national, regional and local
competition. Breadth of service, warehouse locations and customer mix are major
competitive factors, since frozen food manufacturers and distributors incur
transportation costs which typically are significantly greater than warehousing
costs. In addition, in some locations, customers depend upon pooling shipments,
which involves combining their products with the products of other customers
destined for the same markets. In these cases, the mix of customers in a
warehouse can significantly influence the cost of delivering products to
markets. The size of a warehouse is important because large customers prefer to
have all of the products needed to serve a given market in a single location to
have the flexibility to increase storage in that single location during seasonal
peaks. If there are several storage locations that satisfy customer mix and size
requirements, AmeriCold Logistics believes that customers generally will select
a storage facility based upon the types of service available, service
performance and price. Vornado does not control AmeriCold Logistics.

WE MAY INCUR COSTS TO COMPLY WITH ENVIRONMENTAL LAWS.

    Under various Federal, state and local laws, ordinances and regulations, a
current or previous owner or operator of real estate may be required to
investigate and clean up specified hazardous or toxic substances released at a
property. The owner or operator may also be held liable to a governmental entity
or to third parties for property damage or personal injuries and for
investigation and clean-up costs incurred by those parties because of the
contamination. These laws often impose liability without regard to whether the
owner or operator knew of the release of the substances or was responsible for
the release. The presence of contamination or the failure to remediate
contamination may impair the owner's ability to sell or lease real estate or to
borrow using the real estate as collateral. Other Federal, state and local laws,
ordinances and regulations require abatement or removal of asbestos-containing
materials in the event of demolition, renovations or remodeling and also govern
emissions of and exposure

                                       9

to asbestos fibers in the air. The operation and subsequent removal of some
underground storage tanks are also regulated by Federal and state laws. We could
be held liable for the costs of remedial action with respect to the foregoing
regulated substances or tanks or related claims arising out of environmental
contamination at our properties.

WE ARE IN A COMPETITIVE BUSINESS.

    The real estate industry is highly competitive. In each region where we
operate, we compete for tenants with a large number of other real estate
property owners. Principal means of competition are rents charged,
attractiveness of location and quality of service. In addition, we expect other
major real estate investors with significant capital will compete with us for
attractive investment opportunities. These competitors include other REITs,
investment banking firms and private institutional investors. This competition
has increased prices for commercial properties and may impair our ability to
make suitable property acquisitions on favorable terms in the future.

WE MAY NOT BE ABLE TO OBTAIN CAPITAL TO MAKE INVESTMENTS.

    We depend primarily on external financing to fund the growth of our
business. This is because one of the requirements of the Internal Revenue Code
of 1986, as amended, for a REIT is that it distribute 95% of its net taxable
income, excluding net capital gains, to its shareholders. Our access to debt or
equity financing depends on banks' willingness to lend and on conditions in the
capital markets. We and other companies in the real estate industry have
experienced limited availability of bank loans and capital markets financing
from time to time. Although we believe that we will be able to finance any
investments we wish to make in the foreseeable future, financing other than what
we already have available might not be available on acceptable terms. See
'Management's Discussion and Analysis of Financial Condition and Results of
Operations -- Liquidity and Capital Resources' in our Annual Report on Form 10-K
for the year ended December 31, 1999 and the Notes to the Consolidated Financial
Statements in the same report for information about our available sources of
funds.

SOME OF OUR POTENTIAL LOSSES MAY NOT BE COVERED BY INSURANCE.

    We carry comprehensive liability, fire, extended coverage and rental loss
insurance on all of our properties. We believe the policy specifications and
insured limits of these policies are adequate and appropriate. There are,
however, some types of losses, including lease and other contract claims, that
generally are not insured. If an uninsured loss or a loss in excess of insured
limits occurs, we could lose all or a portion of the capital we have invested in
a property, as well as the anticipated future revenue from the property. If this
happens, we might nevertheless remain obligated for any mortgage debt or other
financial obligations related to the property.

                                       10

VORNADO'S OWNERSHIP STRUCTURE AND RELATED-PARTY TRANSACTIONS MAY GIVE RISE TO
CONFLICTS OF INTEREST.

STEVEN ROTH AND INTERSTATE PROPERTIES MAY EXERCISE SUBSTANTIAL INFLUENCE OVER
VORNADO. THEY AND SOME OF VORNADO'S OTHER TRUSTEES AND OFFICERS HAVE INTERESTS
OR POSITIONS IN OTHER ENTITIES THAT MAY COMPETE WITH VORNADO.

    As of December 31, 1999, Interstate Properties and its partners owned
approximately 17.8% of the outstanding common shares of Vornado, 27.3% of
Alexander's Inc.'s common stock and 4.9% of Vornado Operating Company's common
stock, or 17.8% assuming conversion into shares of all of Interstate Properties'
limited partnership units of Vornado Operating L.P. Vornado Operating L.P. is a
Delaware limited partnership of which Vornado Operating Company is the general
partner and through which Vornado Operating Company conducts its business.
Interstate Properties is a general partnership in which Steven Roth, David
Mandelbaum and Russell B. Wight, Jr. are partners. Mr. Roth is the Chairman of
the Board and Chief Executive Officer of Vornado, the Managing General Partner
of Interstate Properties and the Chief Executive Officer and a director of both
Alexander's and Vornado Operating Company. Mr. Wight is a trustee of Vornado and
is also a director of both Alexander's and Vornado Operating Company. Mr.
Mandelbaum is a trustee of Vornado and is also a director of Alexander's.

    As of April 5, 2000, Vornado owned 33.1% of the outstanding common stock of
Alexander's, Inc. Alexander's is a REIT engaged in leasing, managing, developing
and redeveloping properties, focusing primarily on the locations where its
department stores operated before they ceased operations in 1992. Alexander's
has eight properties, which are located in the New York City metropolitan area.
Mr. Roth and Michael D. Fascitelli, Vornado's President and a member of the
Board of Trustees, are directors of Alexander's. Messrs. Mandelbaum, Richard R.
West and Wight are trustees of Vornado and are also directors of Alexander's.

    Vornado formed Vornado Operating Company for the purpose of owning assets
that Vornado could not itself own and conducting activities that Vornado could
not itself conduct. Vornado Operating Company is able to do so because it is
taxable as a regular C corporation rather than as a REIT. On October 16, 1998,
the operating partnership distributed all of the shares of Vornado Operating
Company to its partners, including Vornado, in proportion to their ownership of
operating partnership units, and Vornado distributed the shares it received to
the holders of its common shares in proportion to their ownership of Vornado
common shares. Four members of Vornado's Board of Trustees, Messrs. Roth,
Fascitelli, West and Wight, are members of Vornado Operating Company's Board of
Directors, and certain members of senior management of Vornado hold
corresponding positions with Vornado Operating Company. Members of Vornado's
Board of Trustees and Vornado Operating Company's Board of Directors and senior
management may have different percentage equity interests in Vornado and Vornado
Operating Company.

                                       11

    Because of the foregoing, Mr. Roth and Interstate Properties may have
substantial influence on Vornado, Alexander's and Vornado Operating Company and
on the outcome of any matters submitted to Vornado's, Alexander's or Vornado
Operating Company's shareholders or stockholders for approval. In addition,
there may be conflicts of interest among Messrs. Roth, Mandelbaum and Wight and
Interstate Properties and Vornado's other shareholders concerning Vornado's
operations or financial structure. In addition, Mr. Roth and Interstate
Properties may in the future engage in a wide variety of other activities in the
real estate business, and these activities may result in conflicts of interest
with respect to matters affecting Vornado, Alexander's or Vornado Operating
Company. Matters that may give rise to conflicts of these kinds include:

     determination of which of these entities or persons, if any, may take
     advantage of potential business opportunities;

     decisions concerning the business focus of these entities, including
     decisions concerning the types of properties and geographic locations in
     which they make investments;

     potential competition between business activities conducted, or sought to
     be conducted, by these entities or persons, including competition for
     properties and tenants;

     possible corporate transactions, such as acquisitions; and

     other strategic decisions affecting the future of these parties.

VORNADO ENGAGES IN TRANSACTIONS WITH VORNADO OPERATING COMPANY ON TERMS THAT MAY
OR MAY NOT BE COMPARABLE TO THOSE VORNADO COULD NEGOTIATE WITH UNAFFILIATED
THIRD PARTIES.

    Vornado and Vornado Operating Company have entered into an intercompany
agreement under which, among other things:

     Vornado agreed under specified circumstances to offer Vornado Operating
     Company an opportunity to lease real property owned now or in the future by
     Vornado under mutually satisfactory lease terms; and

     Vornado Operating Company agreed not to make any real estate investment or
     other REIT-qualified investment unless it first offers Vornado the
     opportunity to make the investment and Vornado has rejected that
     opportunity.

    Vornado capitalized Vornado Operating Company with an equity contribution of
$25 million of cash and has extended to Vornado Operating Company a $75 million
unsecured five-year revolving line of credit under a credit agreement. The
intercompany agreement and the credit agreement were not negotiated at arm's
length because Vornado Operating Company was a subsidiary of Vornado at the time
they were negotiated. Therefore, the terms of these agreements may not be
comparable to those Vornado could have negotiated with an unaffiliated third
party.

    Vornado and Vornado Operating Company may enter into additional transactions
in the future. Because Vornado and Vornado Operating Company

                                       12

share common senior management and because a majority of Vornado's Trustees also
constitute the majority of Vornado Operating Company's Directors, the terms of
the foregoing agreements and any future agreements between Vornado and Vornado
Operating Company may not be comparable to those Vornado could have negotiated
with an unaffiliated third party.

THERE MAY BE CONFLICTS OF INTEREST BETWEEN VORNADO AND ALEXANDER'S.

    Vornado has agreed to manage Alexander's business affairs and manage and
develop Alexander's properties for an annual fee under a management and
development agreement between Vornado and Alexander's. Vornado assigned this
management agreement to Vornado Management Corp. Vornado owns 100% of the
outstanding shares of non-voting stock of Vornado Management, which entitles
Vornado to 95% of the economic benefits of Vornado Management through
distributions. Messrs. Roth and West own 100% of the outstanding shares of
voting stock of Vornado Management. Vornado also acts as a leasing agent for
Alexander's properties on a fee basis under a leasing agreement. In addition,
Alexander's owes Vornado $45 million which was borrowed in March 1995 and is the
subordinated tranche of a loan in the original amount of $75 million, which has
a current outstanding balance of $65 million. On October 20, 1999, Vornado
loaned Alexander's another $50 million, under the same terms as the existing $45
million loan. The loans, which were scheduled to mature on March 15, 2000, were
extended to March 15, 2001. None of Mr. Roth, Interstate Properties or Vornado
is obligated to present to Alexander's any particular investment opportunity
which comes to his or its attention, even if the opportunity might be suitable
for investment by Alexander's.

AN AFFILIATED COMPANY PROVIDES CLEANING AND SECURITY SERVICES TO OUR OFFICE
PROPERTIES UNDER CONTRACTS THAT WERE NOT NEGOTIATED AT ARM'S LENGTH.

    David R. Greenbaum, the Chief Executive Officer of Vornado's New York Office
Division, and other investors own a company which provides cleaning and related
services and security services to office properties. We refer to Messrs.
Greenbaum and these other investors as the 'Mendik group.' We have entered into
contracts with the Mendik group to provide services to our office properties.
These contracts were not negotiated at arm's length, and their terms may not be
comparable to those we could have negotiated with unaffiliated third parties.
However, we believe, based upon comparable fees charged to other real estate
companies, that our contracts with the Mendik group are fair to us.

VORNADO'S ORGANIZATIONAL AND FINANCIAL STRUCTURE GIVES RISE TO OPERATIONAL AND
FINANCIAL RISKS, INCLUDING THOSE DESCRIBED BELOW.

WE DO NOT CONTROL SOME OF OUR AFFILIATES.

    Some of our businesses are currently conducted through corporations in which
Vornado owns all of the non-voting stock and none of the voting stock, and these
corporations provide all of our management, operating and leasing services.

                                       13

We refer to these corporations as 'preferred stock affiliates.' Ownership of the
non-voting stock entitles Vornado to substantially all of the distributed income
of these affiliates. The non-voting stock of the preferred stock affiliates is
owned by officers and/or trustees of Vornado. Accordingly, Vornado is not able
to elect the Boards of Directors of the preferred stock affiliates and does not
have the authority to control the management and operations of these affiliates
or the timing or amount of dividends paid by them. Vornado therefore does not
have the authority to require that funds be distributed to it by any of these
entities.

VORNADO DEPENDS ON ITS DIRECT AND INDIRECT SUBSIDIARIES' DIVIDENDS AND
DISTRIBUTIONS, AND THESE SUBSIDIARIES' CREDITORS AND PREFERRED SECURITY HOLDERS
ARE ENTITLED TO PAYMENT OF AMOUNTS PAYABLE TO THEM BY THE SUBSIDIARIES BEFORE
THE SUBSIDIARIES MAY PAY ANY DIVIDENDS OR DISTRIBUTIONS TO VORNADO.

    Substantially all of our assets consist of our partnership interests in the
operating partnership. The operating partnership holds substantially all of its
properties and assets through subsidiaries. The operating partnership therefore
depends for substantially all of its cash flow on cash distributions to it by
its subsidiaries, and Vornado in turn depends for substantially all of its cash
flow on cash distributions to it by the operating partnership. The creditors of
each direct and indirect subsidiary of Vornado are entitled to payment of that
subsidiary's obligations to them, when due and payable, before distributions may
be made by that subsidiary to its equity holders. In addition, the holders of
preferred units of the operating partnership are entitled to receive preferred
distributions before payment of distributions to holders of common units,
including Vornado. Thus, the operating partnership's ability to make
distributions to holders of units depends on its subsidiaries' ability first to
satisfy their obligations to their creditors and then to make distributions to
the operating partnership. Likewise, Vornado's ability to pay dividends to
holders of common and preferred shares depends on the operating partnership's
ability first to satisfy its obligations to its creditors and make distributions
payable to holders of preferred units and then to make distributions to Vornado.
See 'Description of the units and the operating partnership -- Ranking of units'
for information about the outstanding preferred units. In addition, Vornado's
shareholders will have the right to participate in any distribution of the
assets of any of Vornado's direct or indirect subsidiaries upon the liquidation,
reorganization or insolvency of the subsidiary, and consequently to participate
in those assets, only after the claims of the creditors, including trade
creditors, and preferred security holders, if any, of the subsidiary are
satisfied.

WE HAVE INDEBTEDNESS, AND THIS INDEBTEDNESS MAY INCREASE.

    As of December 31, 1999, we had aggregate indebtedness outstanding of
approximately $2,049 million, approximately $1,671 million of which was secured
by our properties. Substantially all of the secured indebtedness was
non-recourse to Vornado, while approximately $378 million of Vornado's aggregate
indebtedness was unsecured, recourse indebtedness of the operating partnership.
The operating partnership's ability to make required principal and interest
payments

                                       14

with respect to indebtedness represented by its debt securities depends on the
earnings of its subsidiaries and on its ability to receive funds from its
subsidiaries through dividends or other payments, since the debt securities are
obligations of the operating partnership only and its subsidiaries are not
obligated to pay any amounts due under the terms of the debt securities or to
make funds available for payment of these amounts in the form of dividends or
advances to the operating partnership.

    As of December 31, 1999, the level of Vornado's debt to enterprise value was
43%, based on debt of $3.2 billion, which included Vornado's proportionate share
of debt of partially-owned entities. When we say 'enterprise value' in the
preceding sentence, we mean market equity value plus debt less cash. In the
future, in connection with our strategy for growth, this percentage may change.
We may review and modify this policy from time to time without the vote of our
shareholders.

LOSS OF OUR KEY PERSONNEL COULD HARM OUR OPERATIONS.

    We depend on the efforts of Steven Roth, the Chairman of the Board of
Trustees and Chief Executive Officer of Vornado, and Michael D. Fascitelli, the
President of Vornado. While we believe that we could find replacements for these
key personnel, the loss of their services could harm our operations.

WE MIGHT FAIL TO QUALIFY OR REMAIN QUALIFIED AS A REIT.

    Although we believe that Vornado will remain organized and will continue to
operate so as to qualify as a REIT for Federal income tax purposes, we might
fail to remain qualified in this way. Qualification as a REIT for Federal income
tax purposes is governed by highly technical and complex provisions of the
Internal Revenue Code for which there are only limited judicial or
administrative interpretations. Vornado's qualification as a REIT also depends
on various facts and circumstances that are not entirely within our control. In
addition, legislation, new regulations, administrative interpretations or court
decisions might significantly change the tax laws with respect to the
requirements for qualification as a REIT or the Federal income tax consequences
of qualification as a REIT.

    If, with respect to any taxable year, Vornado fails to maintain its
qualification as a REIT, it could not deduct distributions to shareholders in
computing its taxable income and would have to pay Federal income tax on its
taxable income at regular corporate rates. The Federal income tax payable would
include any applicable alternative minimum tax. If Vornado had to pay Federal
income tax, the amount of money available to distribute to shareholders would be
reduced for the year or years involved, and Vornado would no longer be required
to distribute money to shareholders. In addition, Vornado would also be
disqualified from treatment as a REIT for the four taxable years following the
year during which qualification was lost, unless Vornado was entitled to relief
under the relevant statutory provisions. Although Vornado currently intends to
operate in a manner designed to allow it to qualify as a REIT, future economic,
market, legal, tax or other considerations may cause it to revoke the REIT
election.

                                       15

VORNADO'S CHARTER DOCUMENTS AND APPLICABLE LAW MAY HINDER ANY ATTEMPT TO ACQUIRE
VORNADO.

    Generally, for Vornado to maintain its qualification as a REIT under the
Internal Revenue Code, not more than 50% in value of the outstanding shares of
beneficial interest of Vornado may be owned, directly or indirectly, by five or
fewer individuals at any time during the last half of Vornado's taxable year.
The Internal Revenue Code defines 'individuals' for purposes of the requirement
described in the preceding sentence to include some types of entities. Under
Vornado's Amended and Restated Declaration of Trust, no person may own more than
6.7% of the outstanding common shares or 9.9% of the outstanding preferred
shares, with some exceptions for persons who held common shares in excess of the
6.7% limit before Vornado adopted the limit. These restrictions on
transferability and ownership may delay, deter or prevent a change in control of
Vornado or other transaction that might involve a premium price or otherwise be
in the best interest of the shareholders. We refer to Vornado's Amended and
Restated Declaration of Trust, as amended, as the 'declaration of trust.'

    Vornado's Board of Trustees is divided into three classes of trustees.
Trustees of each class are chosen for three-year staggered terms. Staggered
terms of trustees may reduce the possibility of a tender offer or an attempt to
change control of Vornado, even though a tender offer or change in control might
be in the best interest of our shareholders. Vornado's declaration of trust
authorizes the Board of Trustees:

     to cause Vornado to issue additional authorized but unissued common shares
     or preferred shares;

     to classify or reclassify, in one or more series, any unissued preferred
     shares; and

     to set the preferences, rights and other terms of any classified or
     reclassified shares that Vornado issues.

    The Board of Trustees could establish a series of preferred shares whose
terms could delay, deter or prevent a change in control of Vornado or other
transaction that might involve a premium price or otherwise be in the best
interest of our shareholders, although the Board of Trustees does not now intend
to establish a series of preferred shares of this kind. Vornado's declaration of
trust and bylaws contain other provisions that may delay, deter or prevent a
change in control of Vornado or other transaction that might involve a premium
price or otherwise be in the best interest of the shareholders.

    Under the Maryland General Corporation Law, as amended, as applicable to
real estate investment trusts, specified 'business combinations' between a
Maryland real estate investment trust and an Interested Shareholder (as defined
below) or an affiliate of the Interested Shareholder are prohibited for five
years after the most recent date on which the Interested Shareholder becomes an
Interested Shareholder. Business combinations for purposes of the preceding
sentence are defined by the statute to include specified mergers,
consolidations, share exchanges and asset transfers and some issuances and
reclassifications of equity securities. After the end of the five-year period,
any business combination

                                       16

with an Interested Shareholder or an affiliate of the Interested Shareholder
must be recommended by the Board of Trustees of the trust and approved by the
affirmative vote of at least:

     80% of the votes entitled to be cast by holders of outstanding shares of
     beneficial interest of the trust; and

     two-thirds of the votes entitled to be cast by holders of voting shares of
     the trust other than shares held by the Interested Shareholder with whom,
     or with whose affiliate, the business combination is to be effected or held
     by an affiliate or associate of the Interested Shareholder, voting together
     as a single voting group.

These percentage approval requirements do not apply if, among other conditions,
the trust's common shareholders receive a statutorily defined minimum price for
their shares and the consideration is received in cash or in the same form as
previously paid by the Interested Shareholder for its common shares. The
provisions of the Maryland General Corporation Law also do not apply to business
combinations that are approved or exempted by the Board of Trustees of the trust
before the Interested Shareholder becomes an Interested Shareholder. The
Maryland General Corporation Law defines 'Interested Shareholder' as any person
who beneficially owns ten percent or more of the voting power of the trust's
shares or an affiliate or an associate (as defined in the Maryland General
Corporation Law) of the trust who, at any time within the two-year period before
the date in question, was the beneficial owner of ten percent or more of the
voting power of the then outstanding voting shares of beneficial interest of the
trust. A person is not an Interested Shareholder if, prior to the time the
person would have become an Interested Shareholder, the Board approved the
transaction which would have resulted in the person becoming an Interested
Shareholder.

    Vornado's Board of Trustees has adopted a resolution exempting any business
combination between Vornado and any Trustee or officer of Vornado or an
affiliate of any Trustee or officer of Vornado. As a result, the Trustees and
officers of Vornado and their affiliates may be able to enter into business
combinations with Vornado which may not be in the best interest of shareholders.
With respect to business combinations with other persons, the business
combination provisions of the Maryland General Corporation Law may delay, deter
or prevent a change in control of Vornado or other transaction that might
involve a premium price or otherwise be in the best interest of the
shareholders.

THE MARKET FOR VORNADO'S SHARES GIVES RISE TO VARIOUS RISKS, INCLUDING THOSE
DESCRIBED BELOW.

VORNADO HAS MANY SHARES AVAILABLE FOR FUTURE SALE, WHICH COULD HURT THE MARKET
PRICE OF OUR SHARES.

    As of December 31, 1999, 22,913,619 common shares were reserved for issuance
upon redemption of units. These shares may be sold in the public market after
registration under the Securities Act of 1933 under registration rights

                                       17

agreements between Vornado and the holders of the units. These shares may also
be sold in the public market under Rule 144 under the Securities Act or other
available exemptions from registration. In addition, we have reserved a number
of common shares for issuance under our employee benefit plans, and these common
shares will be available for sale from time to time. We have granted options to
purchase additional common shares to some of our executive officers and
employees. We cannot predict the effect that future sales of common shares, or
the perception that sales of common shares could occur, will have on the market
prices of our equity securities.

CHANGES IN MARKET CONDITIONS COULD HURT THE MARKET PRICE OF OUR SHARES.

    The value of our shares depends on various market conditions, which may
change from time to time. Among the market conditions that may affect the value
of our shares are the following:

     the extent of institutional investor interest in Vornado;

     the reputation of REITs generally and the attractiveness of their equity
     securities in comparison to other equity securities, including securities
     issued by other real estate companies, and fixed income securities;

     our financial condition and performance; and

     general financial market conditions.

    In addition, the stock market in recent years has experienced extreme price
and volume fluctuations that have often been unrelated or disproportionate to
the operating performance of companies.

INCREASED MARKET INTEREST RATES MAY HURT THE VALUE OF OUR SHARES.

    We believe that investors consider the distribution rate on REIT shares,
expressed as a percentage of the price of the shares, relative to market
interest rates as an important factor in deciding whether to buy or sell the
shares. If market interest rates go up, prospective purchasers of REIT shares
may expect a higher distribution rate. Higher interest rates would not, however,
result in more funds for us to distribute and, in fact, would likely increase
our borrowing costs and might decrease our funds available for distribution.
Thus, higher market interest rates could cause the market price of our shares to
decline.

                                       18

                     VORNADO AND THE OPERATING PARTNERSHIP

    Vornado is a fully-integrated real estate investment trust. Vornado conducts
its business through, and substantially all of its interests in properties are
held by, the operating partnership. Vornado is the sole general partner of, and
owned approximately 86% of the common limited partnership interest in, the
operating partnership at March 1, 2000.

    The operating partnership currently owns directly or indirectly:

     all or portions of 22 office building properties in the New York City
     metropolitan area (primarily Manhattan) containing approximately 14.0
     million square feet;

     a 34% limited partnership interest in Charles E. Smith Commercial Realty
     L.P., a limited partnership which owns interests in and manages
     approximately 10.7 million square feet of office properties in Northern
     Virginia and Washington, D.C., and manages an additional 7.9 million square
     feet of office and other commercial properties in the Washington, D.C.
     area;

     56 shopping center properties in six states and Puerto Rico containing 12.0
     million square feet, including 1.4 million square feet built by tenants on
     land leased from us;

     a 60% interest in partnerships that own 89 warehouse facilities nationwide
     with an aggregate of approximately 428 million cubic feet of refrigerated,
     frozen and dry storage space (excludes 15 additional warehouses containing
     approximately 91 million cubic feet managed by AmeriCold Logistics);

     the Merchandise Mart Properties portfolio containing 6.8 million square
     feet, including the 3.4 million square foot Merchandise Mart in Chicago;

     approximately 33% of the outstanding common stock of Alexander's, which has
     eight properties in the New York City metropolitan area;

     the Hotel Pennsylvania, a New York City hotel which contains 800,000 square
     feet of space with 1,700 rooms and 400,000 square feet of retail and office
     space;

     approximately 30% interest in the Newkirk joint ventures, which own various
     equity and debt interests relating to 120 limited partnerships which own
     real estate, primarily office and retail, net leased to credit rated
     tenants;

     eight dry warehouse/industrial properties in New Jersey containing 2.0
     million square feet; and

     other real estate and investments.

    The principal executive offices of Vornado and the operating partnership are
located at Park 80 West, Plaza II, Saddle Brook, N.J. 07663; telephone
(201) 587-1000.

                                       19

                                USE OF PROCEEDS

    Vornado will not receive any cash proceeds from the issuance of the shares
offered by this prospectus but will acquire units in the operating partnership
in exchange for any shares that Vornado may issue to a redeeming unit holder.

                              REDEMPTION OF UNITS

    At any time after May 1, 2000, you have the right to have your units
redeemed in whole or in part by the operating partnership for cash equal to the
fair market value, at the time of redemption, of one common share of Vornado for
each unit redeemed. We have the right to issue you one common share for each
unit tendered instead of paying the cash redemption amount. You may redeem units
only in compliance with the securities laws, the Second Amended and Restated
Agreement of Limited Partnership of the operating partnership, dated as of
October 20, 1997, as amended, the Limited Partner Acceptance of Partnership
Agreement that you signed when you received your units, and the declaration of
trust's limits on ownership of common shares. We refer to the Second Amended and
Restated Agreement of Limited Partnership of the operating partnership, as
amended, as the 'partnership agreement.'

    You may exercise the right to redeem your units by providing a notice of
redemption, substantially in the form attached as an exhibit to the partnership
agreement, to the operating partnership, with a copy to Vornado. You may also be
required to furnish the operating partnership and Vornado with certain other
certificates and forms. The partnership agreement establishes some limitations
on your right to redeem units. Unless we elect to assume and perform the
operating partnership's obligation with respect to the redemption, as described
below, you will receive cash on the specified redemption date from the operating
partnership in an amount equal to the market value of the units to be redeemed.
When we say 'specified redemption date' in the context of class A units, which
are the kind of units that you hold, we mean:

     if Vornado's common shares are publicly traded, the tenth business day
     after we receive a notice of redemption; and

     if Vornado's common shares are not publicly traded, the thirtieth business
     day after we receive a notice of redemption.

    When we say 'business day,' we mean a day that is not a Saturday, Sunday or
other day on which commercial banks in New York, New York are authorized or
required by law to close. The market value of a unit for the purpose of
redemption will be equal to the average of the closing trading prices of a
Vornado common share on the NYSE for the ten trading days before the day on
which we received the notice of redemption or, if that day is not a business
day, the first business day after that day.

    Instead of the operating partnership's acquiring the units for cash, we have
the right to acquire the units on the specified redemption date directly from
you, in exchange for either the market value of the units in cash or for common
shares. However, we do not have this right if the common shares are not publicly

                                       20

traded, as described below. If we acquire the units, we will become their owner.
In either case, acquisition of the units by Vornado will be treated as a sale of
the units by you to Vornado for Federal income tax purposes. The payment of the
redemption price may be conditioned on our sole satisfaction that any New York
Real Estate Transfer Tax and New York City Real Property Transfer Tax payable by
reason of your redeeming units prior to the second anniversary of the date on
which such units were issued to you have been paid in full or that adequate
provision has been made therefor. If we elect to acquire the units in exchange
for shares, then you are obligated, as a condition to the effective exercise of
the redemption right, to escrow with Vornado an amount equal to the New York
Real Estate Transfer Tax and New York City Real Property Transfer Tax that would
have been payable as of the exercise of the redemption right, assuming that you
transfer the shares received prior to the second anniversary of the date on
which the units were issued to you. Such escrow may be used by us or you for the
payment of the taxes described above, provided, in the latter event, that we
have determined, in our good faith discretion, that such tax will be paid. See
' -- Tax consequences of redemption -- Tax treatment of redemption of units' for
information about the tax consequences of redeeming units to the redeeming unit
holder.

    If we determine to acquire the units in exchange for common shares, the
total number of common shares to be paid to you will be equal to the product of
the number of units times the conversion factor. See 'Description of
units -- Sales of assets' for further information about the conversion factor,
which is 1.0 as of the date of this prospectus. Vornado currently anticipates
that it generally will elect to acquire directly units tendered for redemption
and to issue common shares in exchange for the units rather than paying cash,
but we will decide whether to pay cash or issue common shares upon redemption of
units when units are tendered for redemption.

    When you redeem units, your right to receive distributions on the units so
redeemed or exchanged will cease, unless the record date for a distribution was
a date before the specified redemption date. You must redeem at least 1,000
units at a time, or all of your remaining units if you own less than 1,000
units. No redemption or exchange can occur if delivery of common shares on the
specified redemption date to the unit holder seeking redemption would be
prohibited either under Vornado's declaration of trust or under applicable
Federal or state securities laws as long as the common shares are publicly
traded.

    Each unit holder has agreed with Vornado under the partnership agreement
that all units delivered for redemption must be delivered to the operating
partnership or Vornado, as the case may be, free and clear of all liens. Neither
Vornado nor the operating partnership will be under any obligation to acquire
units if there are liens on the units. Each unit holder has also agreed to pay
any state or local property transfer tax that is payable as a result of the
transfer of his or her units to the operating partnership or Vornado.

                                       21

    If a unit holder assigns his or her units to another person, that person may
redeem the units. In that case, the redemption price will be paid directly to
that person and not to the unit holder.

    If Vornado provides notice to the unit holders that it intends to make an
extraordinary distribution of cash or property to its shareholders or to effect
a merger, a sale of all or substantially all of its assets or any other similar
extraordinary transaction, the right to redeem units will be exercisable during
the period commencing on the date on which Vornado provides that notice and
ending on either:

     if there is a record date to determine shareholders eligible to receive the
     extraordinary distribution or to vote upon the approval of the merger, sale
     or other extraordinary transaction, the record date; or

     if there is no record date of this kind, the date that is twenty days after
     the date on which Vornado provides notice of the extraordinary distribution
     or extraordinary transaction.

A holder must have held his or her units for at least one year from the date of
issuance to have the right to redeem them under these circumstances. If this
paragraph applies, the specified redemption date will be the sooner of:

     the tenth business day after the operating partnership receives the notice
     of redemption; or

     the business day immediately preceding the record date to determine
     shareholders eligible to receive the extraordinary distribution or vote on
     approval of the extraordinary transaction.

However, if the specified redemption date occurs in less than ten business days
and the operating partnership elects to redeem the units for cash, the operating
partnership will have up to ten business days after receiving the notice of
redemption to deliver payment for the units.

    If Vornado merges or consolidates with another company or sells all or
substantially all of its assets as a whole and Vornado's shareholders are
obligated to accept cash and/or debt obligations in full or partial payment for
their common shares in the transaction, then the portion of the payment per unit
payable upon redemption of the units that must be accepted in cash and/or debt
obligations will be equal to an amount of cash equal to the sum of:

     the cash payable for one common share multiplied by the conversion factor;
     and

     the value, on the date on which the transaction is consummated, of the debt
     obligations to be received with respect to one common share multiplied by
     the conversion factor.

    The balance of the amount payable per unit when units are redeemed will be
payable in an amount calculated consistently with the second paragraph of this
section. If a transaction of the kind described in this paragraph occurs at a
time when the consent of some unit holders is required under those lockup
agreements that are contained in the partnership agreement, then the portion of

                                       22

the payment per unit to those unit holders payable upon redemption of their
units that they must accept in cash and/or debt obligations will be increased by
an amount that will provide them with an internal rate of return on that portion
of the payment from the date of the transaction to the date of redemption of the
units equal to the treasury constant yield, as defined in the partnership
agreement. The lockup agreements are described under 'Description of units and
the operating partnership -- Borrowing by the operating partnership.'

    If the common shares are not publicly traded but another entity whose shares
are publicly traded owns more than 50% of the shares of Vornado, the unit
holders' right to redeem units will be determined by reference to the publicly
traded stock of that majority owner of Vornado. In that case, the general
partner of the operating partnership will have the right to elect to acquire the
units to be redeemed for publicly traded stock of the majority owner of Vornado.
If the common shares are not publicly traded and there is no majority owner of
Vornado with publicly traded stock, the unit holders' right to redeem units
would be based upon the net fair market value of the operating partnership's
assets at the time the units are redeemed, as determined in good faith by
Vornado. In that case, Vornado and the operating partnership would be obligated
to pay for redeemed units in cash, payable on the thirtieth business day after
Vornado receives the notice of redemption.

REGISTRATION RIGHTS

    Under registration rights agreements between Vornado and the unit holders
named in these agreements, which have been filed as an exhibit to the
registration statement of which this prospectus forms a part, those unit holders
have the right to demand registration of the common shares for which their units
may be redeemed when they redeem their units, unless the shares they receive are
already registered under an effective registration statement filed with the SEC.
The registration rights agreements provide that Vornado will pay all expenses of
registering the shares. The agreements also provide that the holders of the
shares will pay any brokerage and sales commissions, fees and disbursements of
counsel to the holders, accountants and other advisors, and any transfer taxes
relating to the sale or disposition of the shares by the holders.

TAX CONSEQUENCES OF REDEMPTION

    The following discussion summarizes the material Federal income tax
considerations that may be relevant to a unit holder who redeems his or her
units. This discussion only applies to unit holders that provide an affidavit to
the operating partnership, at the time their units are redeemed, stating that
the unit holder is not a foreign person and stating the unit holder's taxpayer
identification number, under penalties of perjury.

    YOU SHOULD CONSULT YOUR OWN TAX ADVISORS REGARDING THE TAX CONSEQUENCES TO
YOU OF REDEEMING YOUR UNITS, INCLUDING THE FEDERAL, STATE, LOCAL AND FOREIGN TAX
CONSEQUENCES OF REDEEMING UNITS IN YOUR PARTICULAR CIRCUMSTANCES AND POTENTIAL
CHANGES IN APPLICABLE LAWS.

                                       23

TAX TREATMENT OF REDEMPTION OF UNITS

    If Vornado assumes and performs the redemption obligation, the partnership
agreement provides that the redemption will be treated by Vornado, the operating
partnership and the redeeming unit holder as a sale of units by the redeeming
unit holder to Vornado at the time the units are redeemed. This sale will be
fully taxable to the redeeming unit holder, and the redeeming unit holder will
be treated as realizing for tax purposes an amount equal to the sum of:

     the cash or the value of the common shares received in the exchange; plus

     the amount of operating partnership liabilities allocable to the redeemed
     units at the time they are redeemed.

    The amount of operating partnership liabilities considered in this
calculation will include the operating partnership's share of the liabilities of
some entities in which the operating partnership owns an interest. The
determination of the amount of gain or loss is discussed more fully under
' -- Tax treatment of disposition of units by unit holders generally' below.

    If Vornado does not elect to assume the obligation to redeem a unit holder's
units, the operating partnership will redeem the units for cash. If the
operating partnership redeems units for cash that Vornado contributes to the
operating partnership for that purpose, the redemption likely would be treated
for tax purposes as a sale of the units to Vornado in a fully taxable
transaction, although this is not certain. If the redemption is treated that way
for tax purposes, the redeeming unit holder would be treated as realizing an
amount equal to the sum of:

     the cash received in the exchange; plus

     the amount of operating partnership liabilities allocable to the redeemed
     units at the time they are redeemed.

    The amount of operating partnership liabilities considered in this
calculation will include the operating partnership's share of the liabilities of
some entities in which the operating partnership owns an interest. The
determination of the amount of gain or loss if a redemption is treated as a sale
for tax purposes is discussed more fully under ' -- Tax treatment of disposition
of units by unit holders generally' below.

    If, instead, the operating partnership chooses to redeem units for cash that
is not contributed by Vornado for that purpose, the tax consequences would be
the same as described in the previous paragraph with the following exception. If
the operating partnership redeems less than all of a unit holder's units, the
unit holder would not be permitted to recognize any loss occurring on the
transaction and would recognize taxable gain only to the extent that the amount
he or she would be treated as receiving, as described above, exceeded his or her
adjusted basis in all of his or her units immediately before the redemption.

                                       24

POTENTIAL APPLICATION OF DISGUISED SALE REGULATIONS TO A REDEMPTION OF UNITS

    A redemption of units may cause the original transfer of property to the
operating partnership in exchange for units to be treated as a 'disguised sale'
of property. The Internal Revenue Code and the Treasury regulations under the
Internal Revenue Code generally provide that, unless one of the prescribed
exceptions is applicable, a partner's contribution of property to a partnership
and a simultaneous or subsequent transfer of money or other consideration from
the partnership to the partner, including the partnership's assumption of a
liability or taking the property subject to a liability, will be presumed to be
a sale, in whole or in part, of the property by the partner to the partnership.
Further, the Treasury regulations provide generally that, in the absence of an
applicable exception, if a partnership transfers money or other consideration to
a partner within two years after the partner contributed property to the
partnership, the transactions will be presumed to be a sale of the contributed
property unless the facts and circumstances clearly establish that the transfers
do not constitute a sale. The Treasury regulations also provide that if two
years have passed between the time when the partner contributed property to the
partnership and the time when the partnership transferred money or other
consideration to the partner, the transactions will be presumed not to be a sale
unless the facts and circumstances clearly establish that the transfers
constitute a sale.

    Accordingly, if the operating partnership redeems a unit, the Internal
Revenue Service could contend that the redemption should be treated as a
disguised sale because the redeeming unit holder will receive cash or common
shares after having contributed property to the operating partnership. If the
IRS took that position successfully, the issuance of the units in exchange for
the contributed property could be taxable as a disguised sale under the Treasury
regulations.

TAX TREATMENT OF DISPOSITION OF UNITS BY UNIT HOLDERS GENERALLY

    If a unit holder redeems units in a manner that is treated as a sale of the
units, the gain or loss from the sale or other disposition will be based on the
difference between:

     the amount considered realized for tax purposes; and

     the unit holder's tax basis in the units.

See ' -- Basis of units' below for information about the tax basis of units.

    If a unit holder sells units, the 'amount realized' will be measured by the
sum of

     the cash and fair market value of other property received, including any
     common shares; plus

     the portion of the operating partnership's liabilities allocable to the
     units sold.

    The amount of operating partnership liabilities considered in this
calculation will include the operating partnership's share of the liabilities of
some entities in which the operating partnership owns an interest.

                                       25

    A selling unit holder will recognize gain to the extent that the amount he
or she realizes in the sale exceeds his or her basis in the units sold. It is
possible that the amount of gain recognized or even the tax liability resulting
from the gain could exceed the amount of cash and the value of any other
property, including common shares, received in exchange for the units.

    Except as described below, any gain recognized upon a sale or other
disposition of units will be treated as gain attributable to the sale or
disposition of a capital asset. To the extent, however, that the amount realized
upon the sale of a unit attributable to a unit holder's share of 'unrealized
receivables' of the operating partnership (as defined in Section 751 of the
Internal Revenue Code) exceeds the basis attributable to those assets, this
excess will be treated as ordinary income. Unrealized receivables include, to
the extent not previously included in operating partnership income, any rights
to payment for services rendered or to be rendered. Unrealized receivables also
include amounts that would be subject to recapture as ordinary income if the
operating partnership had sold its assets at their fair market value at the time
of the transfer of a unit.

    For non-corporate holders, the maximum rate of tax on the net capital gain
from the sale or exchange of a capital asset held for more than one year is 20%.
The maximum rate for net capital gains attributable to the sale of depreciable
real property held for more than one year is 25% to the extent of the prior
deductions for depreciation that are not otherwise recaptured as ordinary income
under the existing depreciation recapture rules.

    The IRS has authority to issue regulations that could, among other things,
apply these rates on a look-through basis in the case of 'pass-through' entities
such as Vornado and the operating partnership. The IRS has not yet issued
regulations of this kind. If it does not issue regulations of this kind in the
future, the rate of tax that would apply to the disposition of a unit by a
non-corporate holder would be determined based upon the period of time over
which the non-corporate holder held the unit. The IRS might, however, issue
regulations that would provide that the rate of tax that would apply to the
disposition of a unit by a non-corporate holder would be determined based upon
the nature of the assets of the operating partnership and the periods of time
over which the operating partnership held the assets. Moreover, if the IRS
adopts regulations of this kind, they might apply retroactively.

BASIS OF UNITS

    In general, a unit holder who received units in exchange for contributing an
interest in a partnership has an initial tax basis in the units equal to his or
her basis in the contributed partnership interest. A unit holder's initial basis
in his or her units generally is increased by:

     the unit holder's share of operating partnership taxable and tax-exempt
     income;

     increases in his or her share of the liabilities of the operating
     partnership, including the operating partnership's share of the liabilities
     of some entities in which the operating partnership owns an interest; and

                                       26

     any gain recognized under Section 737 of the Internal Revenue Code due to
     the receipt of a distribution from the operating partnership within seven
     years after the unit holder contributed property to the operating
     partnership.

Generally, a unit holder's initial basis in his or her units is decreased by:

     his or her share of operating partnership distributions;

     decreases in his or her share of liabilities of the operating partnership,
     including the operating partnership's share of the liabilities of some
     entities in which the operating partnership owns an interest;

     his or her share of losses of the operating partnership; and

     his or her share of nondeductible expenditures of the operating partnership
     that are not chargeable to capital.

However, a unit holder's initial basis will not decrease below zero.

                                       27

                          DESCRIPTION OF COMMON SHARES

    The following description of the common shares does not describe every
aspect of the common shares and is only a summary of, and is qualified in its
entirety by reference to, the provisions governing the common shares contained
in the declaration of trust and bylaws. Copies of the declaration of trust and
bylaws are exhibits to the registration statement of which this prospectus is a
part. See 'Where you can find more information' for information about how to
obtain copies of the declaration of trust and bylaws.

VORNADO'S AUTHORIZED AND OUTSTANDING CLASSES OF SHARES

    The declaration of trust authorizes the issuance of up to 390,000,000 shares
of beneficial interest, consisting of 150,000,000 common shares, $.04 par value
per share, 45,000,000 preferred shares of beneficial interest no par value per
share, and 195,000,000 excess shares of beneficial interest, $.04 par value per
share. We refer to the excess shares of beneficial interest, $.04 par value per
share, as 'excess shares.' See ' -- Restrictions on ownership' for a discussion
of the possible issuance of excess shares.

    As of December 31, 1999, 86,335,741 common shares, 5,789,239 series A
preferred shares, 3,400,000 8.5% series B cumulative redeemable preferred shares
and 4,600,000 8.5% series C cumulative redeemable preferred shares were issued
and outstanding, and no 8.5% series D-1 cumulative redeemable preferred shares,
8.375% series D-2 cumulative redeemable preferred shares, 8.25% series D-3
cumulative redeemable preferred shares, 8.25% series D-4 cumulative redeemable
preferred shares or 8.25% Series D-5 cumulative redeemable preferred shares or
excess shares were issued and outstanding. The common shares of Vornado are
listed on the NYSE under the symbol 'VNO.'

DIVIDEND AND VOTING RIGHTS OF HOLDERS OF COMMON SHARES

    The holders of common shares are entitled to receive dividends when, if and
as authorized by the Board of Trustees and declared by Vornado out of assets
legally available to pay dividends, if receipt of the dividends is in compliance
with the provisions in the declaration of trust restricting the transfer of
shares of beneficial interest. However, if any preferred shares are at the time
outstanding, Vornado may only pay dividends or other distributions on common
shares or purchase common shares if full cumulative dividends have been paid on
outstanding preferred shares and there is no arrearage in any mandatory sinking
fund on outstanding preferred shares. The terms of the series of preferred
shares that are now issued and outstanding do not provide for any mandatory
sinking fund.

    The holders of common shares are entitled to one vote for each share on all
matters on which shareholders are entitled to vote, including elections of
trustees. There is no cumulative voting in the election of trustees, which means
that the holders of a majority of the outstanding common shares can elect all of
the trustees then standing for election. The holders of common shares do not
have any conversion, redemption or preemptive rights to subscribe to any
securities of Vornado. If Vornado is dissolved, liquidated or wound up, holders
of common

                                       28

shares are entitled to share proportionally in any assets remaining after the
prior rights of creditors, including holders of Vornado's indebtedness, and the
aggregate liquidation preference of any preferred shares then outstanding are
satisfied in full.

    The common shares have equal dividend, distribution, liquidation and other
rights and have no preference, appraisal or exchange rights. All outstanding
common shares are, and any common shares offered by a prospectus supplement,
upon issuance, will be, duly authorized, fully paid and non-assessable.

    The transfer agent for the common shares is First Union National Bank,
Charlotte, North Carolina.

RESTRICTIONS ON OWNERSHIP OF COMMON SHARES

THE COMMON SHARES BENEFICIAL OWNERSHIP LIMIT

    For Vornado to maintain its qualification as a REIT under the Internal
Revenue Code, not more than 50% of the value of its outstanding shares of
beneficial interest may be owned, directly or indirectly, by five or fewer
individuals at any time during the last half of a taxable year and the shares of
beneficial interest must be beneficially owned by 100 or more persons during at
least 335 days of a taxable year of 12 months, or during a proportionate part of
a shorter taxable year. The Internal Revenue Code defines 'individuals' to
include some entities for purposes of the preceding sentence. All references to
a shareholder's ownership of common shares in this section ' -- The common
shares beneficial ownership limit' assume application of the applicable
attribution rules of the Internal Revenue Code under which, for example, a
shareholder is deemed to own shares owned by his or her spouse.

    The declaration of trust contains a number of provisions which restrict the
ownership and transfer of shares and which are designed to safeguard Vornado
against an inadvertent loss of its REIT status. The declaration of trust
contains a limitation that restricts, with some exceptions, shareholders from
owning more than a specified percentage of the outstanding common shares. We
call this percentage the 'common shares beneficial ownership limit.' The common
shares beneficial ownership limit was initially set at 2.0% of the outstanding
common shares. The Board of Trustees subsequently adopted a resolution raising
the common shares beneficial ownership limit from 2.0% to 6.7% of the
outstanding common shares. The shareholders who owned more than 6.7% of the
common shares immediately after the merger of Vornado, Inc. into Vornado in May
1993 may continue to do so and may acquire additional common shares through
stock option and similar plans or from other shareholders who owned more than
6.7% of the common shares immediately after that merger. However, common shares
cannot be transferred if, as a result, more than 50% in value of the outstanding
shares of Vornado would be owned by five or fewer individuals. While the
shareholders who owned more than 6.7% of the common shares immediately after the
merger of Vornado, Inc. into Vornado in May 1993 are not generally permitted to
acquire additional common shares from any other source, these shareholders may
acquire additional common shares from any source if Vornado

                                       29

issues additional common shares, up to the percentage held by them immediately
before Vornado issues the additional shares.

    Shareholders should be aware that events other than a purchase or other
transfer of common shares can result in ownership, under the applicable
attribution rules of the Internal Revenue Code, of common shares in excess of
the common shares beneficial ownership limit. For instance, if two shareholders,
each of whom owns 3.5% of the outstanding common shares, were to marry, then
after their marriage both shareholders would be deemed to own 7.0% of the
outstanding common shares, which is in excess of the common shares beneficial
ownership limit. Similarly, if a shareholder who owns 4.9% of the outstanding
common shares were to purchase a 50% interest in a corporation which owns 4.8%
of the outstanding common shares, then the shareholder would be deemed to own
7.3% of the outstanding common shares. You should consult your own tax advisors
concerning the application of the attribution rules of the Internal Revenue Code
in your particular circumstances.

THE CONSTRUCTIVE OWNERSHIP LIMIT

    Under the Internal Revenue Code, rental income received by a REIT from
persons in which the REIT is treated, under the applicable attribution rules of
the Internal Revenue Code, as owning a 10% or greater interest does not
constitute qualifying income for purposes of the income requirements that REITs
must satisfy. For these purposes, a REIT is treated as owning any stock owned,
under the applicable attribution rules of the Internal Revenue Code, by a person
that owns 10% or more of the value of the outstanding shares of the REIT. The
attribution rules of the Code applicable for these purposes are different from
those applicable with respect to the common shares beneficial ownership limit.
All references to a shareholder's ownership of common shares in this section
' -- The constructive ownership limit' assume application of the applicable
attribution rules of the Internal Revenue Code.

    In order to ensure that rental income of Vornado will not be treated as
nonqualifying income under the rule described in the preceding paragraph, and
thus to ensure that Vornado will not inadvertently lose its REIT status as a
result of the ownership of shares by a tenant, or a person that holds an
interest in a tenant, the declaration of trust contains an ownership limit that
restricts, with some exceptions, shareholders from owning more than 9.9% of the
outstanding shares of any class. We refer to this 9.9% ownership limit as the
'constructive ownership limit.' The shareholders who owned shares in excess of
the constructive ownership limit immediately after the merger of Vornado, Inc.
into Vornado in May 1993 generally are not subject to the constructive ownership
limit. The declaration of trust also contains restrictions that are designed to
ensure that the shareholders who owned shares in excess of the constructive
ownership limit immediately after the merger of Vornado, Inc. into Vornado in
May 1993 will not, in the aggregate, own a large enough interest in a tenant or
subtenant of the REIT to cause rental income received, directly or indirectly,
by the REIT from that tenant or subtenant to be treated as nonqualifying income
for purposes of the income requirements that REITs must satisfy. The
restrictions

                                       30

described in the preceding sentence have an exception for tenants and subtenants
from whom the REIT receives, directly or indirectly, rental income that is not
in excess of a specified threshold.

    Shareholders should be aware that events other than a purchase or other
transfer of shares can result in ownership, under the applicable attribution
rules of the Internal Revenue Code, of shares in excess of the constructive
ownership limit. As the attribution rules that apply with respect to the
constructive ownership limit differ from those that apply with respect to the
common shares beneficial ownership limit, the events other than a purchase or
other transfer of shares which can result in share ownership in excess of the
constructive ownership limit can differ from those which can result in share
ownership in excess of the common shares beneficial ownership limit. You should
consult your own tax advisors concerning the application of the attribution
rules of the Internal Revenue Code in your particular circumstances.

ISSUANCE OF EXCESS SHARES IF THE OWNERSHIP LIMITS ARE VIOLATED

    The declaration of trust provides that a transfer of common shares that
would otherwise result in ownership, under the applicable attribution rules of
the Internal Revenue Code, of common shares in excess of the common shares
beneficial ownership limit or the constructive ownership limit, or which would
cause the shares of beneficial interest of Vornado to be beneficially owned by
fewer than 100 persons, will have no effect and the purported transferee will
acquire no rights or economic interest in the common shares. In addition, the
declaration of trust provides that common shares that would otherwise be owned,
under the applicable attribution rules of the Internal Revenue Code, in excess
of the common shares beneficial ownership limit or the constructive ownership
limit will be automatically exchanged for excess shares. These excess shares
will be transferred, by operation of law, to Vornado as trustee of a trust for
the exclusive benefit of a beneficiary designated by the purported transferee or
purported holder. While so held in trust, excess shares are not entitled to vote
and are not entitled to participate in any dividends or distributions made by
Vornado. Any dividends or distributions received by the purported transferee or
other purported holder of the excess shares before Vornado discovers the
automatic exchange for excess shares must be repaid to Vornado upon demand.

    If the purported transferee or purported holder elects to designate a
beneficiary of an interest in the trust with respect to the excess shares, he or
she may designate only a person whose ownership of the shares will not violate
the common shares beneficial ownership limit or the constructive ownership
limit. When the designation is made, the excess shares will be automatically
exchanged for common shares. The declaration of trust contains provisions
designed to ensure that the purported transferee or other purported holder of
the excess shares may not receive, in return for transferring an interest in the
trust with respect to the excess shares, an amount that reflects any
appreciation in the common shares for which the excess shares were exchanged
during the period that the excess shares were outstanding but will bear the
burden of any decline in value during that period. Any amount received by a
purported transferee or

                                       31

other purported holder for designating a beneficiary in excess of the amount
permitted to be received must be turned over to Vornado. The declaration of
trust provides that Vornado, or its designee, may purchase any excess shares
that have been automatically exchanged for common shares as a result of a
purported transfer or other event. The price at which Vornado, or its designee,
may purchase the excess shares will be equal to the lesser of:

     in the case of excess shares resulting from a purported transfer for value,
     the price per share in the purported transfer that resulted in the
     automatic exchange for excess shares, or in the case of excess shares
     resulting from some other event, the market price of the common shares
     exchanged on the date of the automatic exchange for excess shares; and

     the market price of the common shares exchanged for the excess shares on
     the date that Vornado accepts the deemed offer to sell the excess shares.

    Vornado's right to buy the excess shares will exist for 90 days, beginning
on the date that the automatic exchange for excess shares occurred or, if
Vornado did not receive a notice concerning the purported transfer that resulted
in the automatic exchange for excess shares, the date that the Board of Trustees
determines in good faith that an exchange for excess shares has occurred.

OTHER PROVISIONS CONCERNING THE RESTRICTIONS ON OWNERSHIP

    The Board of Trustees may exempt persons from the common shares beneficial
ownership limit or the constructive ownership limit, including the limitations
applicable to holders who owned in excess of 6.7% of the common shares
immediately after the merger of Vornado, Inc. into Vornado in May 1993, if
evidence satisfactory to the Board of Trustees is presented showing that the
exemption will not jeopardize Vornado's status as a REIT under the Internal
Revenue Code. Before granting an exemption of this kind, the Board of Trustees
may require a ruling from the IRS and/or an opinion of counsel satisfactory to
it and/or representations and undertakings from the applicant with respect to
preserving the REIT status of Vornado.

    The foregoing restrictions on transferability and ownership will not apply
if the Board of Trustees determines that it is no longer in the best interests
of Vornado to attempt to qualify, or to continue to qualify, as a REIT.

    All persons who own, directly or by virtue of the applicable attribution
rules of the Internal Revenue Code, more than 2.0% of the outstanding common
shares must give a written notice to Vornado containing the information
specified in the declaration of trust by January 31 of each year. In addition,
each shareholder will be required to disclose to the Company upon demand any
information that Vornado may request, in good faith, to determine Vornado's
status as a REIT or to comply with Treasury regulations promulgated under the
REIT provisions of the Internal Revenue Code.

    The ownership restrictions described above may have the effect of precluding
acquisition of control of Vornado unless the Board of Trustees determines that
maintenance of REIT status is no longer in the best interests of Vornado.

                                       32

             DESCRIPTION OF THE UNITS AND THE OPERATING PARTNERSHIP

    The following description of the material terms of the units and some
material provisions of the partnership agreement does not describe every aspect
of the units or the partnership agreement and is only a summary of, and
qualified in its entirety by reference to, applicable provisions of Delaware law
and the partnership agreement. A copy of the partnership agreement is filed as
an exhibit to the registration statement of which this prospectus is a part. See
'Where you can find more information' for information about how to obtain a copy
of the partnership agreement. For a comparison of the voting rights and some
other rights of unit holders in the operating partnership and shareholders of
Vornado, see 'Comparison of ownership of units and common shares.'

THE OPERATING PARTNERSHIP'S OUTSTANDING CLASSES OF UNITS

    Holders of units, other than Vornado in its capacity as general partner,
hold a limited partnership interest in the operating partnership. All holders of
units, including Vornado in its capacity as general partner, are entitled to
share in cash distributions from, and in the profits and losses of, the
operating partnership.

    Holders of units have the rights to which limited partners are entitled
under the partnership agreement and the Delaware Revised Uniform Limited
Partnership Act. The units are not registered under any Federal or state
securities laws, and they are not listed on any exchange or quoted on any
national market system. The partnership agreement imposes restrictions on the
transfer of units. See ' -- Restrictions on transfers of units' below for
further information about these restrictions.

    As of December 31, 1999, there were outstanding:

     5,789,239 series A preferred units;

     3,400,000 series B pass-through preferred units;

     4,600,000 series C pass-through preferred units;

     899,566 series B-1 convertible preferred units;

     449,783 series B-2 restricted convertible preferred units;

     747,912 series C-1 convertible preferred units;

     3,500,000 series D-1 preferred units;

     549,336 series D-2 preferred units;

     8,000,000 series D-3 preferred units;

     5,000,000 series D-4 preferred units;

     7,480,000 series D-5 preferred units;

     4,998,000 Series E-1 convertible preferred units;

     92,586,702 class A units, including 6,250,961 not held by Vornado; and

     876,543 class D units.

                                       33

DISTRIBUTIONS WITH RESPECT TO UNITS

    The partnership agreement provides for distributions, as determined in the
manner provided in the partnership agreement, to Vornado and the limited
partners in proportion to their percentage interests in the operating
partnership, subject to the distribution preferences that are described in the
next paragraph. As general partner of the operating partnership, Vornado has the
exclusive right to declare and cause the operating partnership to make
distributions as and when Vornado deems appropriate or desirable in its sole
discretion. For so long as Vornado elects to qualify as a REIT, Vornado will
make reasonable efforts, as determined by it in its sole discretion, to make
distributions to partners in amounts such that Vornado will be able to pay
shareholder dividends that will satisfy the requirements for qualification as a
REIT and avoid any Federal income or excise tax liability for Vornado.

    Distributions vary among the holders of different classes of units:

     The series A preferred units entitle Vornado as their holder to a
     cumulative preferential distribution at an annual rate of $3.25 per series
     A preferred unit, which we refer to as the 'series A preferred distribution
     preference.' The series A preferred units correspond to the series A
     preferred shares of Vornado.

     The series B pass-through preferred units entitle Vornado as their holder
     to a cumulative preferential distribution at an annual rate of $2.125 per
     unit, which we call the 'series B pass-through preferred distribution
     preference.' The series B pass-through preferred units correspond to the
     series B preferred shares of Vornado.

     The series C pass-through preferred units entitle Vornado as their holder
     to a cumulative preferential distribution at an annual rate of $2.125 per
     unit, which we call the 'series C pass-through preferred distribution
     preference.' The series C pass-through preferred units correspond to the
     series C preferred shares of Vornado.

     The series B-1 convertible preferred units entitle their holder to a
     preferential distribution at the annual rate of $2.50 per unit, and the
     series B-2 restricted preferred units entitle their holders to a
     preferential distribution at the annual rate of $4.00 per unit. We refer to
     these preferential distributions as the 'series B-1 and B-2 preferred
     distribution preferences.'

     The series C-1 preferred units entitle their holder to a preferential
     distribution at the annual rate of $3.25 per unit, which we refer to as the
     'series C-1 preferred distribution preference.'

     The series D-1 preferred units entitle their holder to a preferential
     distribution at the annual rate of $2.125 per unit, which we refer to as
     the 'series D-1 preferred distribution preference.'

     The series D-2 preferred units entitle their holder to a preferential
     distribution at the annual rate of $4.1875 per unit, which we refer to as
     the 'series D-2 preferred distribution preference.'

                                       34

     The series D-3 preferred units entitle their holder to a preferential
     distribution at the annual rate of $2.0625 per unit, which we refer to as
     the 'series D-3 preferred distribution preference.'

     The series D-4 preferred units entitle their holder to a preferential
     distribution at the annual rate of $2.0625 per unit, which we refer to as
     the 'series D-4 preferred distribution preference.'

     The series D-5 preferred units entitle their holder to a preferential
     distribution at the annual rate of $2.0625 per unit, which we refer to as
     the 'series D-5 preferred distribution preference.'

     The series E-1 preferred units entitle their holder to a preferential
     distribution at the annual rate of (a) $3.00 per unit for distributions
     paid in respect of the period from the date of issuance through, but
     excluding, the first anniversary of that date, (b) $3.125 per unit for
     distributions paid in respect of the period from the first anniversary of
     the date of issuance through, but excluding, the second anniversary of that
     date, (c) $3.25 per unit for distributions paid in respect of the period
     from the second anniversary of the date of issuance through, but excluding,
     the seventh anniversary of the date of issuance and (d) $3.375 per unit for
     distributions paid in respect of any period thereafter. We refer to this
     preferential distribution as the 'series E-1 preferred distribution
     preference.'

     The class D units entitle their holder to a preferential quarterly
     distribution of $0.50375 per unit, which we refer to as the 'class D
     distribution preference,' until the operating partnership has made four
     consecutive quarterly distributions of at least $0.50375 per unit to the
     holders of the class A units.

    We sometimes refer to the series A preferred distribution preference, the
series B pass-through preferred distribution preference, the series C
pass-through preferred distribution preference, the series B-1 and B-2 preferred
distribution preferences, the series C-1 preferred distribution preference, the
series D-1 preferred distribution preference, the series D-2 preferred
distribution preference, the series D-3 preferred distribution preference, the
series D-4 preferred distribution preference, the series D-5 preferred
distribution preference and the series E-1 preferred distribution preference as
the 'preferred distribution preferences.' We sometimes refer to the preferred
distribution preferences, and the class D distribution preference together as
the 'distribution preferences.'

    The value of each common unit, regardless of its class, equates to one
common share of Vornado. Preferred units do not have a value equating to one
common share, but have the liquidation preferences and conversion prices for
conversion into class A units or terms for redemption for cash or corresponding
preferred shares that are established in the partnership agreement.

    The partnership agreement provides that the operating partnership will make
distributions when, as and if declared by Vornado in the order of preference
provided for in the partnership agreement. The order of preference in the
partnership agreement provides that distributions will be paid first to Vornado
as

                                       35

necessary to enable Vornado to pay REIT expenses. The partnership agreement
defines 'REIT expenses' to mean:

     costs and expenses relating to the continuity of existence of Vornado and
     any entity in which Vornado owns an equity interest;

     costs and expenses relating to any offer or registration of securities by
     Vornado;

     costs and expenses associated with preparing and filing periodic reports of
     Vornado under Federal, state and local laws, including SEC filings;

     costs and expenses associated with Vornado's compliance with laws, rules
     and regulations applicable to it; and

     all other operating or administrative expenses incurred by Vornado in the
     ordinary course of its business.

    After the operating partnership pays Vornado distributions as necessary to
enable Vornado to pay REIT expenses, distributions will be paid:

     first, to holders of any class of preferred units ranking senior, as to
     distributions or redemption or voting rights, to class D units;

     second, to holders of class D units for any accumulated and unpaid class D
     distribution preferences and on an equal priority to holders of preferred
     units not ranking senior to the class D units for any accumulated and
     unpaid preferred distribution preferences; and

     third, to holders of class A units.

    The series A preferred units, series B pass-through preferred units, and
series C pass-through preferred units rank senior to the class D units. The
other series of preferred units do not rank senior to the class D units. See
' -- Ranking of units' for more information about the relative priorities of the
various series and classes of units. Class D unit holders will also share in any
distribution per quarter to class A unit holders above $0.50375 per unit.

    Before the automatic conversion of class D units to class A units as
described under ' -- Ranking of units' below, Vornado will be permitted to cause
the operating partnership to make a distribution to holders of class A units of
cash up to an aggregate maximum amount of $878,912 representing any funds from
operations that could have been and were not distributed to holders of class A
units (without requiring proportional distributions to holders of class D units)
during the twelve calendar quarters preceding the quarter in which the
distribution is made.

RANKING OF UNITS

    The series A preferred units, series B pass-through preferred units, and
series C pass-through preferred units rank senior to the class A units and class
D units with respect to the payment of distributions and amounts upon
liquidation, dissolution or winding up of the operating partnership. The series
A preferred units, series B pass-through preferred units, series C pass-through
preferred units, series B-1 convertible preferred units, series B-2 restricted
preferred units, series

                                       36

C-1 preferred units, series D-1 preferred units, series D-2 preferred units,
series D-3 preferred units, series D-4 preferred units, series D-5 preferred
units, series E-1 preferred units and any other units designated as 'parity
units' all rank on a parity with each other, in each case with respect to the
payment of distributions and amounts upon liquidation, dissolution or winding up
of the operating partnership, without preference or priority one over the other,
except that:

     For so long as the class D units are outstanding, the series B-1
     convertible preferred units, series B-2 restricted preferred units, series
     C-1 preferred units, series D-1 preferred units, series D-2 preferred
     units, series D-3 preferred units, series D-4 preferred units, series D-5
     preferred units, and series E-1 preferred units will not rank senior to the
     class D units as to preferential distributions or redemption or voting
     rights. The class D units automatically will be converted into class A
     units when all holders of class A units have received quarterly
     distributions equal to $.50375 per unit per quarter for four consecutive
     quarters.

The series of preferred units have the following liquidation preferences:

     $50.00 per series A preferred unit, series B-1 convertible preferred unit,
     series B-2 restricted preferred unit, series C-1 preferred unit, series D-2
     preferred unit, and series E-1 convertible preferred unit;

     $25.00 per series B pass-through preferred unit; series C pass-through
     preferred unit, series D-3 preferred unit, series D-4 preferred unit,
     series D-5 preferred unit; and

     an amount per series D-1 preferred unit equal to the capital account of the
     series D-1 preferred unit. The capital account of the series D-1 preferred
     units is equal to an original capital contribution of $25.00 per unit,
     adjusted from time to time to reflect the operating partnership's income,
     gains, losses and deductions that are allocated to the series D-1 preferred
     units and actual or deemed distributions to, or capital contributions by,
     the holders of series D-1 preferred units.

    Until the class D units are converted into class A units, the partnership
agreement will prohibit the operating partnership from issuing any class of
limited partnership interests ranking senior, as to distributions or redemption
or voting rights, to class D units, unless either:

     the new limited partnership interests are substantially similar to the
     terms of securities issued by Vornado and the proceeds of the issuance of
     those securities have been contributed to the operating partnership; or

     the issuance of the new limited partnership interests has been approved by
     the holders of a majority of the class D units issued in 1997 and then
     outstanding, taken together as a group.

    The operating partnership may create additional classes of parity units or
issue series of parity units without the consent of any holder of series A
preferred shares, series B preferred shares, or series C preferred shares.

                                       37

REDEMPTION OR CONVERSION OF UNITS

    The holders of class A units, other than Vornado or any subsidiary of
Vornado, have the right to redeem their units for cash or, at Vornado's option,
common shares. See 'Redemption of units' above for further information about
this right.

    The series A preferred units are redeemable at Vornado's option for class A
units at any time beginning on April 1, 2001, and are convertible at Vornado's
option into class A units at any time, provided that an equivalent number of
series A preferred shares are concurrently converted into common shares by their
holders. The number of class A units into which the series A preferred units are
redeemable or convertible is equal to the aggregate liquidation preference of
the series A preferred units being redeemed or converted divided by their
conversion price. The conversion price of the series A preferred units is now
$36.10 and may be adjusted from time to time to take account of stock dividends
and other transactions.

    The series B pass-through preferred units are redeemable at Vornado's option
for cash equal to $25.00 per unit and any accumulated and unpaid distributions
owing in respect of the series B pass-through preferred units at any time
beginning on March 17, 2004, provided that an equivalent number of series B
preferred shares are concurrently redeemed by Vornado.

    The series C pass-through preferred units are redeemable at Vornado's option
for cash equal to $25.00 per unit and any accumulated and unpaid distributions
owing in respect of the series C pass-through preferred units at any time
beginning on May 17, 2004, provided that an equivalent number of series C
preferred shares are concurrently redeemed by Vornado.

    The series B-1 convertible preferred units are redeemable at any time
beginning on January 1, 2008 at Vornado's option for a number of class A units
equal to the aggregate liquidation preference of the series B-1 convertible
preferred units of $50.00 per unit divided by the conversion price of the series
B-1 convertible preferred units of $54.7050. The series B-2 restricted preferred
units are redeemable at any time beginning on January 1, 2008 at Vornado's
option for cash of $50 per unit. The series B-1 convertible preferred units and
series B-2 restricted preferred units are convertible at any time at the option
of their holders in groups of two series B-1 convertible preferred units and one
series B-2 restricted preferred unit into a number of class A units equal to the
aggregate series B-1 and B-2 preferred liquidation preferences of the units
being converted divided by the conversion price of $54.7050.

    The series C-1 preferred units are perpetual and may be redeemed without
penalty in whole or in part by the operating partnership at any time beginning
on November 24, 2003 for 1.1431 class A units per series C-1 preferred unit,
subject to anti-dilution adjustments. Holders of series C-1 preferred units have
the right to convert all or a portion of their series C-1 preferred units at any
time into class A units at the same rate.

    The series D-1 preferred units are perpetual and may be redeemed without
penalty in whole or in part by the operating partnership at any time beginning
on

                                       38

November 12, 2003 for cash equal to $25.00 per unit and any accumulated and
unpaid distributions owing in respect of the series D-1 preferred units being
redeemed. At any time beginning on November 12, 2008, or earlier upon the
occurrence of specified events, holders of series D-1 preferred units will have
the right to have their series D-1 preferred units redeemed by the operating
partnership for either:

     cash equal to $25.00 for each series D-1 preferred unit and any accumulated
     and unpaid distributions owing in respect of the series D-1 preferred units
     being redeemed; or

     at Vornado's option, one series D-1 8.5% cumulative redeemable preferred
     share of beneficial interest, no par value, of Vornado for each series D-1
     preferred unit redeemed.

    The series D-2 preferred units are perpetual and may be redeemed without
penalty in whole or in part by the operating partnership at any time beginning
on May 27, 2004 for cash equal to $50.00 per unit and any accumulated and unpaid
distributions owing in respect of the series D-2 units being redeemed. At any
time beginning on May 27, 2009, or earlier upon the occurrence of specified
events, holders of series D-2 preferred units will have the right to have their
series D-2 preferred units redeemed by the operating partnership for either:

     cash equal to $50.00 for each series D-2 preferred unit and any accumulated
     and unpaid distributions owing in respect of the series D-2 preferred units
     being redeemed; or

     at Vornado's option, one series D-2 preferred share of Vornado for each
     series D-2 preferred unit redeemed.

    The series D-3 preferred units are perpetual and may be redeemed without
penalty in whole or in part by the operating partnership at any time beginning
on September 3, 2004 for cash equal to $25.00 per unit and any accumulated and
unpaid distributions owing in respect of the series D-3 units being redeemed. At
any time beginning on September 3, 2009, or earlier upon the occurrence of
specified events, holders of series D-3 preferred units will have the right to
have their series D-3 preferred units redeemed by the operating partnership for
either:

     cash equal to $25.00 for each series D-3 preferred unit and any accumulated
     and unpaid distributions owing in respect of the series D-3 preferred units
     being redeemed; or

     at Vornado's option, one series D-3 preferred share of Vornado for each
     series D-3 preferred unit redeemed.

    The series D-4 preferred units are perpetual and may be redeemed without
penalty in whole or in part by the operating partnership at any time beginning
on September 3, 2004 for cash equal to $25.00 per unit and any accumulated and
unpaid distributions owing in respect of the series D-4 units being redeemed. At
any time beginning on September 3, 2009, or earlier upon the occurrence of
specified events, holders of series D-4 preferred units will have the right to
have their series D-4 preferred units redeemed by the operating partnership for
either:

                                       39

     cash equal to $25.00 for each series D-4 preferred unit and any accumulated
     and unpaid distributions owing in respect of the series D-4 preferred units
     being redeemed; or

     at Vornado's option, one series D-4 preferred share of Vornado for each
     series D-4 preferred unit redeemed.

    The series D-5 preferred units are perpetual and may be redeemed without
penalty in whole or in part by the operating partnership at any time beginning
on November 24, 2004 for cash equal to $25.00 per unit and any accumulated and
unpaid distributions owing in respect of the series D-5 units being redeemed. At
any time beginning on November 24, 2009, or earlier upon the occurrence of
specified events, holders of series D-5 preferred units will have the right to
have their series D-5 preferred units redeemed by the operating partnership for
either:

     cash equal to $25.00 for each series D-5 preferred unit and any accumulated
     and unpaid distributions owing in respect of the series D-5 preferred units
     being redeemed; or

     at Vornado's option, one series D-5 preferred share of Vornado for each
     series D-5 preferred unit redeemed.

    The series E-1 convertible preferred units are redeemable at any time
beginning on March 3, 2004 at Vornado's option for cash equal to $50.00 for each
series E-1 convertible preferred unit and any accumulated and unpaid
distributions owing in respect of the series E-1 convertible preferred units
being redeemed. Commencing on May 1, 2000, holders of series E-1 convertible
preferred units will have the right to have their series E-1 convertible
preferred units redeemed by the operating partnership for either:

     a number of class A units equal to the aggregate liquidation preferences of
     the series E-1 convertible preferred units being converted divided by the
     conversion price of $44.00, subject to customary antidilution adjustments;
     or

     at the holder's option, cash equal to that same number of class A units
     multiplied by the value on the redemption date of one common share.

FORMATION OF THE OPERATING PARTNERSHIP

    The operating partnership was formed as a limited partnership under the
Delaware Revised Uniform Limited Partnership Act on October 2, 1996. Vornado is
the sole general partner of, and owned approximately 86% of the common limited
partnership interest in, the operating partnership at March 1, 2000.

PURPOSES, BUSINESS AND MANAGEMENT OF THE OPERATING PARTNERSHIP

    The purpose of the operating partnership includes the conduct of any
business that may be lawfully conducted by a limited partnership formed under
the Delaware Revised Uniform Limited Partnership Act, except that the
partnership agreement requires the business of the operating partnership to be
conducted in a manner that will permit Vornado to be classified as a REIT under
Section 856 of the Internal Revenue Code, unless Vornado ceases to qualify as

                                       40

a REIT for any reason. In furtherance of its business, the operating partnership
may enter into partnerships, joint ventures, limited liability companies or
similar arrangements and may own interests in any other entity engaged, directly
or indirectly, in any of the foregoing.

    Vornado, as the general partner of the operating partnership, has the
exclusive power and authority to conduct the business of the operating
partnership, except that the consent of the limited partners is required in some
limited circumstances discussed under ' -- Meetings and voting' below. No
limited partner may take part in the operation, management or control of the
business of the operating partnership by virtue of being a holder of units.

    In particular, the limited partners expressly acknowledge in the partnership
agreement that the general partner is acting on behalf of the operating
partnership and Vornado's shareholders collectively, and is under no obligation
to consider the tax consequences to, or other separate interests of, limited
partners when making decisions on behalf of the operating partnership. Except as
required by the lockup agreements, Vornado intends to make decisions in its
capacity as general partner of the operating partnership taking into account the
interests of Vornado and the operating partnership as a whole, independent of
the tax effects on the limited partners. See ' -- Borrowing by the operating
partnership' below for a discussion of the lockup agreements. Vornado and its
trustees and officers will have no liability to the operating partnership or to
any partner or assignee for any losses sustained, liabilities incurred or
benefits not derived as a result of errors in judgment or mistakes of fact or
law or any act or omission if Vornado acted in good faith.

ABILITY OF VORNADO TO ENGAGE IN OTHER BUSINESSES; CONFLICTS OF INTEREST

    Vornado generally may not conduct any business other than through the
operating partnership without the consent of the holders of a majority of the
common limited partnership interests, excluding the limited partnership
interests held by Vornado. Other persons including officers, trustees,
employees, agents and other affiliates of Vornado are not prohibited under the
partnership agreement from engaging in other business activities and are not
required to present any business opportunities to the operating partnership. In
addition, the partnership agreement does not prevent another person or entity
that acquires control of Vornado in the future from conducting other businesses
or owning other assets, even though those businesses or assets may be ones that
it would be in the best interests of the limited partners for the operating
partnership to own.

BORROWING BY THE OPERATING PARTNERSHIP

    Vornado is authorized to cause the operating partnership to borrow money and
to issue and guarantee debt as it deems necessary for the conduct of the
activities of the operating partnership. The operating partnership's debt may be
secured by mortgages, deeds of trust, liens or encumbrances on the operating
partnership's properties. Vornado also may cause the operating partnership to
borrow money to enable the operating partnership to make distributions,
including

                                       41

distributions in an amount sufficient to permit Vornado to avoid the payment of
any Federal income tax.

    From time to time in connection with acquisitions of properties or other
assets in exchange for limited partner interests in the operating partnership,
Vornado and the operating partnership have entered into contractual arrangements
that impose restrictions on the operating partnership's ability to sell,
finance, refinance and, in some instances, pay down existing financing on
certain of the operating partnership's properties or other assets. These
arrangements are sometimes referred to as 'lockup agreements' and include, for
example, arrangements in which the operating partnership agrees that it will not
sell the property or other assets in question for a period of years unless the
operating partnership also pays the contributing partner a portion of the
Federal income tax liability that will accrue to that partner as a result of the
sale. Arrangements of this kind may significantly reduce the operating
partnership's ability to sell, finance or repay indebtedness secured by the
subject properties or assets. Vornado expects to cause the operating partnership
to continue entering into transactions of this type in the future and may do so
without obtaining the consent of any partners in the operating partnership.

REIMBURSEMENT OF VORNADO; TRANSACTIONS WITH VORNADO AND ITS AFFILIATES

    Vornado does not receive any compensation for its services as general
partner of the operating partnership. Vornado, however, as a partner in the
operating partnership, has the same right to allocations and distributions with
respect to the units it holds as other partners in the operating partnership
holding the same classes of units. In addition, the operating partnership
reimburses Vornado for all expenses it incurs relating to the ongoing operation
of Vornado and any other offering of additional partnership interests in the
operating partnership, securities of Vornado or rights, options, warrants or
convertible or exchangeable securities, including expenses in connection with
this registration of common shares for issuance in exchange for units if Vornado
assumes the obligation to redeem units and elects to redeem them for common
shares instead of cash when a limited partner in the operating partnership
exercises the right to redeem units. See 'Redemption of units' above for further
information about the right to redeem units.

    Except as expressly permitted by the partnership agreement, the operating
partnership will not, directly or indirectly, sell, transfer or convey any
property to, or purchase any property from, or borrow funds from, or lend funds
to, any partner in the operating partnership or any affiliate of the operating
partnership or Vornado that is not also a subsidiary of the operating
partnership, except in a transaction that has been approved by a majority of the
disinterested trustees of Vornado, taking into account the fiduciary duties of
Vornado to the limited partners of the operating partnership.

                                       42

LIABILITY OF VORNADO AND LIMITED PARTNERS

    Vornado, as general partner of the operating partnership, is liable for all
general recourse obligations of the operating partnership to the extent not paid
by the operating partnership. Vornado is not liable for the nonrecourse
obligations of the operating partnership.

    The limited partners in the operating partnership are not required to make
additional contributions to the operating partnership. Assuming that a limited
partner does not take part in the control of the business of the operating
partnership and otherwise complies with the provisions of the partnership
agreement, the liability of a limited partner for obligations of the operating
partnership under the partnership agreement and the Delaware Revised Uniform
Limited Partnership Act will be limited, with some exceptions, generally to the
loss of the limited partner's investment in the operating partnership
represented by his or her units. Under the Delaware Revised Uniform Limited
Partnership Act, a limited partner may not receive a distribution from the
operating partnership if, at the time of the distribution and after giving
effect to the distribution, the liabilities of the operating partnership, other
than liabilities to parties on account of their interests in the operating
partnership and liabilities for which recourse is limited to specified property
of the operating partnership, exceed the fair value of the operating
partnership's assets, other than the fair value of any property subject to
nonrecourse liabilities of the operating partnership, but only to the extent of
such liabilities. The Delaware Revised Uniform Limited Partnership Act provides
that a limited partner who receives a distribution knowing at the time that it
violates the foregoing prohibition is liable to the operating partnership for
the amount of the distribution. Unless otherwise agreed, a limited partner in
the circumstances described in the preceding sentence will not be liable for the
return of the distribution after the expiration of three years from the date of
the distribution.

    The operating partnership has qualified to conduct business in the State of
New York and may qualify in certain other jurisdictions. Maintenance of limited
liability may require compliance with legal requirements of those jurisdictions
and some other jurisdictions. Limitations on the liability of a limited partner
for the obligations of a limited partnership have not been clearly established
in many jurisdictions. Accordingly, if it were determined that the right, or
exercise of the right by the limited partners, to make some amendments to the
partnership agreement or to take other action under the partnership agreement
constituted 'control' of the operating partnership's business for the purposes
of the statutes of any relevant jurisdiction, the limited partners might be held
personally liable for the operating partnership's obligations.

EXCULPATION AND INDEMNIFICATION OF VORNADO

    The partnership agreement generally provides that Vornado, as general
partner of the operating partnership, will incur no liability to the operating
partnership or any limited partner for losses sustained, liabilities incurred or
benefits not derived as a result of errors in judgment or mistakes of fact or
law

                                       43

or any act or omission, if Vornado acted in good faith. In addition, Vornado is
not responsible for any misconduct or negligence on the part of its agents,
provided Vornado appointed those agents in good faith. Vornado may consult with
legal counsel, accountants, appraisers, management consultants, investment
bankers and other consultants and advisors, and any action it takes or omits to
take in reliance upon the opinion of those persons, as to matters that Vornado
reasonably believes to be within their professional or expert competence, will
be conclusively presumed to have been done or omitted in good faith and in
accordance with the opinion of those persons.

    The partnership agreement also provides for indemnification of Vornado, the
trustees and officers of Vornado and any other persons that Vornado may from
time to time designate against any and all losses, claims, damages, liabilities,
expenses, judgments, fines, settlements and other amounts incurred by an
indemnified person in connection with any proceeding and related to the
operating partnership or Vornado, the formation and operations of the operating
partnership or Vornado or the ownership of property by the operating partnership
or Vornado, unless it is established by a final determination of a court of
competent jurisdiction that:

     the act or omission of the indemnified person was material to the matter
     giving rise to the proceeding and either was committed in bad faith or was
     the result of active and deliberate dishonesty;

     the indemnified person actually received an improper personal benefit in
     money, property or services; or

     in the case of any criminal proceeding, the indemnified person had
     reasonable cause to believe that the act or omission was unlawful.

SALES OF ASSETS

    Under the partnership agreement, Vornado generally has the exclusive
authority to determine whether, when and on what terms assets of the operating
partnership will be sold, as long as any sale of a property covered by the
lockup agreements complies with those provisions. The partnership agreement
prohibits Vornado from engaging in any merger, consolidation or other
combination with or into another person, sale of all or substantially all of its
assets or any reclassification, recapitalization or change of the terms of any
outstanding common shares unless, in connection with the transaction, all
limited partners other than Vornado and entities controlled by Vornado will have
the right to elect to receive, or will receive, for each unit an amount of cash,
securities or other property equal to the conversion factor multiplied by the
greatest amount of cash, securities or other property paid to a holder of shares
of beneficial interest of Vornado, if any, corresponding to that unit in
consideration of one share of that kind. We refer to transactions described in
the preceding sentence as 'termination transactions.' The conversion factor is
initially 1.0, but will be adjusted as necessary to prevent dilution or
inflation of the interests of limited partners that would result if Vornado were
to pay a dividend on its outstanding shares of beneficial interest in shares of
beneficial interest, subdivide its outstanding shares

                                       44

of beneficial interest or combine its outstanding shares of beneficial interest
into a smaller number of shares, in each case without a corresponding issuance
to, or redemption or exchange of interests held by, limited partners in the
operating partnership.

    See ' -- Borrowing by the operating partnership' above for information about
the lockup agreements, which limit our ability to sell some of our properties.

REMOVAL OF THE GENERAL PARTNER; TRANSFER OF VORNADO'S INTERESTS

    The partnership agreement provides that the limited partners may not remove
Vornado as general partner of the operating partnership with or without cause.
In addition, the partnership agreement prohibits Vornado from engaging in any
termination transaction unless all limited partners other than Vornado and
entities controlled by Vornado will have the right in the termination
transaction to elect to receive, or will receive, for each unit an amount of
cash, securities or other property equal to the conversion factor multiplied by
the greatest amount of cash, securities or other property paid to a holder of
shares of beneficial interest of Vornado, if any, corresponding to that unit in
consideration of one share of Vornado. The lock-out provisions and the gross-up
provisions do not apply to a sale or other transfer by Vornado of its interests
as a partner in the operating partnership, but they would apply to transfers of
assets of the operating partnership undertaken during the period when the lockup
agreements are in effect as part of any sale or other transfer by Vornado of its
interests as a partner in the operating partnership. See ' -- Borrowing by the
operating partnership' for a description of the restrictions on transfers of
assets under the lockup agreements.

    The partnership agreement does not prevent a transaction in which another
entity acquires control or all of the shares of Vornado and that other entity
owns assets and conducts businesses outside of the operating partnership.

RESTRICTIONS ON TRANSFERS OF UNITS BY LIMITED PARTNERS

    A limited partner, other than Vornado, some members of the Mendik group and
FW/Mendik REIT, is permitted to transfer all or any portion of his or her units
without restriction, provided that the limited partner obtains Vornado's prior
written consent, which Vornado may withhold only if it determines in its sole
discretion exercised in good faith that the transfer would cause the operating
partnership or any or all of the partners other than the partner seeking to make
the transfer to incur tax liability. In addition, limited partners other than
Vornado or any subsidiary of Vornado are permitted to dispose of their units by
exercising their right to redeem units as described under 'Redemption of units'
above.

    Any permitted transferee of units may become a substituted limited partner
only with the consent of Vornado, and Vornado may withhold its consent in its
sole and absolute discretion. If Vornado does not consent to the admission of a
transferee of units as a substituted limited partner, then the transferee will
succeed to the economic rights and benefits attributable to the units, including
the

                                       45

right to redeem units, but will not become a limited partner or possess any
other rights of limited partners, including the right to vote.

NO WITHDRAWAL BY LIMITED PARTNERS

    No limited partner has the right to withdraw from or reduce his or her
capital contribution to the operating partnership, except as a result of the
redemption, exchange or transfer of units under the terms of the partnership
agreement.

ISSUANCE OF LIMITED PARTNERSHIP INTERESTS

    Vornado is authorized, without the consent of the limited partners, to cause
the operating partnership to issue limited partnership interests to Vornado, to
the limited partners and to other persons for the consideration and upon the
terms and conditions that Vornado deems appropriate. The operating partnership
also may issue partnership interests in different series or classes. See
' -- Ranking' above for a description of restrictions on the issuance of units
while the class D units remain outstanding. Units may be issued to Vornado only
if Vornado issues shares of beneficial interest and contributes to the operating
partnership the proceeds received by Vornado from the issuance of the shares.
Consideration for partnership interests may be cash or any property or other
assets permitted by the Delaware Revised Uniform Limited Partnership Act. No
limited partner has preemptive, preferential or similar rights with respect to
capital contributions to the operating partnership or the issuance or sale of
any partnership interests.

MEETINGS AND VOTING

    Meetings of the limited partners may be proposed and called only by Vornado.
Limited partners may vote either in person or by proxy at meetings. Any action
that is required or permitted to be taken by the limited partners may be taken
either at a meeting of the limited partners or without a meeting if consents in
writing stating the action so taken are signed by limited partners owning not
less than the minimum number of units that would be necessary to authorize or
take the action at a meeting of the limited partners at which all limited
partners entitled to vote on the action were present. On matters in which
limited partners are entitled to vote, each limited partner, including Vornado
to the extent it holds units, will have a vote equal to the number of common
units he or she holds. At this time, there is no voting preference among the
classes of common units. The preferred units have no voting rights, except as
required by law or the terms of a particular series of preferred units. A
transferee of units who has not been admitted as a substituted limited partner
with respect to his or her transferred units will have no voting rights with
respect to those units, even if the transferee holds other units as to which he
or she has been admitted as a limited partner, and units owned by the transferee
will be deemed to be voted on any matter in the same proportion as all other
interests held by limited partners are voted. The partnership agreement does not
provide for annual meetings of the limited partners, and Vornado does not
anticipate calling such meetings.

                                       46

AMENDMENT OF THE PARTNERSHIP AGREEMENT

    Amendments to the partnership agreement may be proposed only by Vornado.
Vornado generally has the power, without the consent of any limited partners, to
amend the partnership agreement as may be required to reflect any changes to the
agreement that Vornado deems necessary or appropriate in its sole discretion,
provided that the amendment does not adversely affect or eliminate any right
granted to a limited partner that is protected by the special voting provisions
described below. Limitations on Vornado's power to amend the partnership
agreement are described below.

    The partnership agreement provides that it generally may not be amended with
respect to any partner adversely affected by the amendment without the consent
of that partner if the amendment would:

     convert a limited partner's interest into a general partner's interest;

     modify the limited liability of a limited partner;

     amend Section 7.11.A, which prohibits Vornado from taking any action in
     contravention of an express prohibition or limitation in the partnership
     agreement without the written consent of all partners adversely affected by
     the action or any lower percentage of the limited partnership interests
     that may be specifically provided for in the partnership agreement or under
     the Delaware Revised Uniform Limited Partnership Act;

     amend Article V, which governs distributions, Article VI, which governs
     allocations of income and loss for capital account purposes, or Section
     13.2A(3), which provides for distributions, after payment of partnership
     debts, among partners according to their capital accounts upon a winding up
     of the operating partnership;

     amend Section 8.6, which provides redemption rights; or

     amend the provision being described in this paragraph.

    In addition, except with the consent of a majority of the common limited
partners, excluding Vornado and entities controlled by Vornado, Vornado may not
amend:

     Section 4.2.A, which authorizes issuance of additional limited partnership
     interests;

     Section 5.1.C, which requires that if Vornado is not a REIT or a publicly
     traded entity it must for each taxable year make cash distributions equal
     to at least 95% of the operating partnership's taxable income;

     Section 7.5, which prohibits Vornado from conducting any business other
     than in connection with the ownership of interests in the operating
     partnership except with the consent of a majority of the common limited
     partners, excluding Vornado and any entity controlled by Vornado;

     Section 7.6, which limits the operating partnership's ability to enter
     transactions with affiliates;

     Section 7.8, which establishes limits on Vornado's liabilities to the
     operating partnership and the limited partners;

                                       47

     Section 11.2, which limits Vornado's ability to transfer its interests in
     the operating partnership;

     Section 13.1, which describes the manner and circumstances in which the
     operating partnership will be dissolved;

     Section 14.1.C, which establishes the limitations on amendments being
     described in this paragraph; or

     Section 14.2, which establishes the rules governing meetings of partners.

    In addition, any amendment that would affect those lockup agreements that
are part of the partnership agreement requires the consent of 75% of the limited
partners benefited by those lockup agreements, with some exceptions. See
'Description of the units and the operating partnership -- Borrowing by the
operating partnership' for information about the lockup agreements.

BOOKS AND REPORTS

    Vornado is required to keep the operating partnership's books and records at
the principal office of the operating partnership. The books of the operating
partnership are required to be maintained for financial and tax reporting
purposes on an accrual basis in accordance with generally accepted accounting
principles, which we refer to as 'GAAP.' The limited partners have the right,
with some limitations, to receive copies of the most recent annual and quarterly
reports filed with the SEC by Vornado, the operating partnership's Federal,
state and local income tax returns, a list of limited partners, the partnership
agreement and the partnership certificate and all amendments to the partnership
certificate. Vornado may keep confidential from the limited partners any
information that Vornado believes to be in the nature of trade secrets or other
information whose disclosure Vornado in good faith believes is not in the best
interests of the operating partnership or which the operating partnership is
required by law or by agreements with unaffiliated third parties to keep
confidential.

    Vornado will furnish to each limited partner, no later than the date on
which Vornado mails its annual report to its shareholders, an annual report
containing financial statements of the operating partnership, or of Vornado, if
Vornado prepares consolidated financial statements including the operating
partnership, for each fiscal year, presented in accordance with GAAP. The
financial statements will be audited by a nationally recognized firm of
independent public accountants selected by Vornado. In addition, if and to the
extent that Vornado mails quarterly reports to its shareholders, Vornado will
furnish to each limited partner, no later than the date on which Vornado mails
the quarterly reports to its shareholders, a report containing unaudited
financial statements of the operating partnership, or of

    Vornado, if the reports are prepared on a consolidated basis, as of the last
day of the quarter and any other information that may be required by applicable
law or regulation or that Vornado deems appropriate.

    Vornado will use reasonable efforts to furnish to each limited partner,
within 90 days after the close of each taxable year, the tax information
reasonably

                                       48

required by the limited partners for Federal and state income tax reporting
purposes.

POWER OF ATTORNEY

    Under the terms of the partnership agreement, each limited partner and each
assignee appoints Vornado, any liquidator, and the authorized officers and
attorneys-in-fact of each, as the limited partner's or assignee's
attorney-in-fact to do the following:

     to execute, swear to, acknowledge, deliver, file and record in the
     appropriate public offices (a) all certificates, documents and other
     instruments including, among other things, the partnership agreement and
     the certificate of limited partnership and all amendments or restatements
     of the certificate of limited partnership that Vornado or any liquidator
     deems appropriate or necessary to form, qualify or maintain the existence
     of the operating partnership as a limited partnership in the State of
     Delaware and in all other jurisdictions in which the operating partnership
     may conduct business or own property, (b) all instruments that Vornado or
     any liquidator deems appropriate or necessary to reflect any amendment or
     restatement of the partnership agreement in accordance with its terms, (c)
     all conveyances and other instruments that Vornado or any liquidator deems
     appropriate or necessary to reflect the dissolution and liquidation of the
     operating partnership under the terms of the partnership agreement, (d) all
     instruments relating to the admission, withdrawal, removal or substitution
     of any partner, any transfer of units or the capital contribution of any
     partner and (e) all certificates, documents and other instruments relating
     to the determination of the rights, preferences and privileges of
     partnership interests; and

     to execute, swear to, acknowledge and file all ballots, consents,
     approvals, waivers, certificates and other instruments appropriate or
     necessary, in the sole and absolute discretion of Vornado or any
     liquidator, to make, evidence, give, confirm or ratify any vote, consent,
     approval, agreement or other action which is made or given by the partners
     under the partnership agreement or is consistent with the terms of the
     partnership agreement or appropriate or necessary, in the sole discretion
     of Vornado or any liquidator, to effectuate the terms or intent of the
     partnership agreement.

The partnership agreement provides that this power of attorney is irrevocable,
will survive the subsequent incapacity of any limited partner and the transfer
of all or any portion of the limited partner's or assignee's units and will
extend to the limited partner's or assignee's heirs, successors, assigns and
personal representatives.

DISSOLUTION, WINDING UP AND TERMINATION

    The operating partnership will continue until December 31, 2095, as this
date may be extended by the General Partner in its sole discretion, unless
sooner dissolved and terminated. The operating partnership will be dissolved
before the

                                       49

expiration of its term, and its affairs wound up upon the occurrence of the
earliest of:

     the withdrawal of Vornado as general partner without the permitted transfer
     of Vornado's interest to a successor general partner, except in some
     limited circumstances;

     the sale of all or substantially all of the operating partnership's assets
     and properties, subject to the lockup agreements during the period when the
     lockup agreements are in effect;

     the entry of a decree of judicial dissolution of the operating partnership
     under the provisions of the Delaware Revised Uniform Limited Partnership
     Act;

     the entry of a final non-appealable order for relief in a bankruptcy
     proceeding of the general partner, or the entry of a final non-appealable
     judgment ruling that the general partner is bankrupt or insolvent, except
     that, in either of these cases, in some circumstances the limited partners
     other than Vornado may vote to continue the operating partnership and
     substitute a new general partner in place of Vornado; or

     on or after December 31, 2046, on election by Vornado, in its sole and
     absolute discretion.

Upon dissolution, Vornado, as general partner, or any liquidator will proceed to
liquidate the assets of the operating partnership and apply the proceeds from
the liquidation in the order of priority provided in the partnership agreement.

                                       50

               COMPARISON OF OWNERSHIP OF UNITS AND COMMON SHARES

    The information below highlights a number of the significant differences and
similarities between the operating partnership and Vornado relating to, among
other things, form of organization, investment objectives, policies and
restrictions, asset diversification, capitalization, management structure,
duties, liability, exculpation and indemnification of the general partner and
the trustees and investor voting and other rights. These comparisons are
intended to assist you in understanding how your investment will be changed if
you redeem your units and Vornado exercises its right to assume the operating
partnership's obligation with respect to the redemption and to acquire the units
in exchange for common shares. See 'Redemption of units' for a description of
your right to have your units redeemed and Vornado's right to redeem the units
for common shares instead of cash. THE DISCUSSION BELOW IS ONLY A SUMMARY OF
THESE MATTERS, AND YOU SHOULD CAREFULLY REVIEW THE BALANCE OF THIS PROSPECTUS
FOR ADDITIONAL IMPORTANT INFORMATION.

                                    
    THE OPERATING PARTNERSHIP              VORNADO
                     FORM OF ORGANIZATION AND PURPOSES
    The operating partnership is a         Vornado is a Maryland real estate
limited partnership organized under    investment trust organized under
the laws of the State of Delaware.     Maryland REIT law. Although Vornado
The operating partnership owns         currently intends to continue to
interests in office building           qualify as a REIT under the Internal
properties, shopping center            Revenue Code and to operate as a
properties, temperature controlled     self- administered REIT, Vornado is
logistics facilities, trade showroom   not under any contractual obligation
properties, industrial/warehouse       to continue to qualify as a REIT and
properties and various other           Vornado may not continue to maintain
properties and investments. See        this qualification or mode of
'Vornado and the operating             operation in the future. Although
partnership' for further information   Vornado has no intention of ceasing
about the operating partnership's      to qualify as a REIT, some other real
assets. The operating partnership may  estate companies that previously
also invest in other types of real     operated as REITs have chosen to
estate and in any geographic areas     cease to qualify as REITs. Except as
that Vornado deems appropriate.        otherwise permitted in the
Vornado conducts the business of the   partnership agreement, Vornado is
operating partnership in a manner      obligated to conduct its activities
intended to permit Vornado to be       through the operating partnership.
classified as a REIT under the         Vornado is the sole general partner
Internal Revenue Code.                 of the operating partnership.

                            NATURE OF INVESTMENT
    The units constitute equity            The common shares constitute
interests entitling each limited       equity interests in Vornado. Vornado
partner in the operating partnership   is entitled to receive its
to his or her                          proportionate

                                       51

                                    
    THE OPERATING PARTNERSHIP              VORNADO
    proportional share of cash         share of distributions made by the
distributions made to the limited      operating partnership with respect to
partners in the operating              the class A units owned by it. Each
partnership, consistent with the       holder of common shares of Vornado is
class preferences provided for in the  entitled to his or her proportionate
partnership agreement. See             share of any dividends or
'Description of                        distributions paid with respect to
units -- Distributions' for further    those common shares, and these
information about distributions to     distributions will generally match
limited partners.                      distributions made in respect of
    The units entitle their holders    class A units. The dividends payable
to participate in the growth and       to holders of common shares are not
income of the operating partnership.   fixed in amount and are only paid if,
The partnership agreement grants       when and as authorized by the Board
Vornado discretion to determine the    of Trustees and declared by Vornado
frequency and amount of distributions  out of assets legally available to
by the operating partnership. The      pay dividends. If any preferred
operating partnership and thus         shares are at the time outstanding,
Vornado generally expect to retain     dividends on the common shares and
and reinvest proceeds of any sale of   other distributions, including
property and refinancings, except in   purchases by Vornado of common
some limited circumstances. Thus,      shares, may be made only if full
limited partners in the operating      cumulative dividends have been
partnership will not be able to        declared and paid on the outstanding
realize upon their investments         preferred shares and there are no
through distributions of sale and      arrearages in any mandatory sinking
refinancing proceeds. Instead,         fund on outstanding preferred shares.
limited partners will be able to       To qualify as a REIT, Vornado must
realize upon their investments         distribute to its shareholders at
primarily by redeeming units and, if   least 95% of its taxable income
Vornado issues common shares in        excluding capital gains, and
exchange for redeemed units, by        corporate income tax will apply to
subsequently selling the common        any taxable income including capital
shares.                                gains not distributed.

                            LENGTH OF INVESTMENT
    The operating partnership has a        Vornado has a perpetual term and
stated term expiring on December 31,   intends to continue its operations
2095, which can be extended by         for an indefinite time period. Under
Vornado in its sole discretion. The    the declaration of trust, the
operating partnership has no specific  dissolution of Vornado must be
plans for disposition of its assets.   approved at any meeting of
To the extent that the operating       shareholders called for that purpose
partnership sells or refinances its    by the affirmative vote of the
assets, the net proceeds from the      holders of not less than a majority
sale or refinancing generally will be  of 'shares', as defined in the
retained by the operating partnership  declaration of trust, outstanding.
for working                            Vornado has an indirect interest in
                                       the properties and

                                       52

                                    
    THE OPERATING PARTNERSHIP              VORNADO
    capital and new investments        property service businesses owned by
rather than being distributed to its   the operating partnership.
partners, including Vornado, except    Shareholders of Vornado are expected
that Vornado currently expects that    to realize liquidity of their
it generally will distribute the       investments by the trading of the
capital gains portion of proceeds it   common shares on the NYSE.
receives from the sale of properties.
The operating partnership constitutes
a vehicle for taking advantage of
future investment opportunities that
may be available in the real estate
market.
    The operating partnership
generally will reinvest the proceeds
of asset dispositions, if any, in new
properties or other appropriate
investments consistent with its
investment objectives. After the
expiration of the applicable holding
period with respect to their units,
limited partners in the operating
partnership are entitled to exercise
the right to have their units
redeemed either for common shares or
for cash, at the option of Vornado.

                                 LIQUIDITY
    Units are not registered under         Any common shares issued in
the Securities Act or any state        exchange for redeemed units will be
securities laws and therefore may not  registered under the Securities Act
be sold, pledged, hypothecated or      and be freely transferable, as long
otherwise transferred unless first     as the shareholder complies with the
registered under the Securities Act    ownership limits in the declaration
and any applicable state securities    of trust. Vornado's common shares are
laws, or unless an exemption from      currently listed on the NYSE under
registration is available. Units also  the ticker symbol of 'VNO' and have
may not be sold or otherwise           been so listed by Vornado and its
transferred unless the other transfer  predecessor for over 35 years. The
restrictions discussed below have      future breadth and strength of this
been satisfied. Vornado and the        secondary market will depend, among
operating partnership do not intend    other things, upon the number of
to register the units under the        common shares outstanding, Vornado's
Securities Act or any state            financial results and prospects, the
securities laws.                       general interest in Vornado's and
    Limited partners in the operating  other's real estate investments, and
partnership may not transfer any of    Vornado's dividend yield compared to
their rights as limited partners       that of other debt and equity
without the consent of Vornado, and    securities.
Vornado

                                       53

                                    
    THE OPERATING PARTNERSHIP              VORNADO
    may withhold its consent in its
sole discretion if it determines that
the transfer would cause any or all
of the limited partners other than
the limited partner seeking to
transfer his or her rights to incur
tax liability as a result of the
transfer. Limited partners in the
operating partnership may, after the
expiration of the applicable holding
period with respect to their units,
transfer beneficial interests in
units without the consent of Vornado
as general partner of the operating
partnership, if they comply with
restrictions designed to avoid
violations of any Federal or state
securities laws. A transferee of
units has no right to become a
substituted limited partner without
the consent of Vornado, which Vornado
may withhold in its sole and absolute
discretion. Limited partners have the
right to elect to have their units
redeemed by the operating
partnership. Upon redemption of
units, a limited partner will receive
cash or, at the election of Vornado,
common shares of Vornado in exchange
for the redeemed units.

                        POTENTIAL DILUTION OF RIGHTS
    Vornado as general partner of the      The Board of Trustees of Vornado
operating partnership is authorized,   may, in its discretion, authorize the
in its sole discretion and without     issuance of additional common shares
limited partner approval, to cause     and other equity securities of
the operating partnership to issue     Vornado, including one or more
additional limited partnership         classes or series of common or
interests and other equity securities  preferred shares of beneficial
for any partnership purpose at any     interest, with the voting rights,
time to Vornado, the limited partners  dividend or interest rates,
or other persons on terms established  preferences, subordinations,
by Vornado. Until all class D units    conversion or redemption prices or
have been converted into class A       rights, maturity dates, distribution,
units, the partnership agreement will  exchange or liquidation rights or
prohibit the operating partnership     other rights that the Board of
from issuing any class of limited      Trustees may specify at the time. The
partnership interests ranking senior   issuance of additional shares of
as to distributions or redemption      either common shares or other similar
                                       equity securities may result in

                                       54

                                    
    THE OPERATING PARTNERSHIP              VORNADO
    or voting rights to class D        the dilution of the interests of the
units, unless either:                  shareholders. As permitted by the
     the newly issued limited          Maryland REIT Law, the declaration of
     partnership interests are         trust contains a provision permitting
     substantially similar to the      the Board of Trustees, without any
     terms of securities issued by     action by the shareholders of
     Vornado and the proceeds of the   Vornado, to amend the declaration of
     issuance of the Vornado           trust to increase or decrease the
     securities have been contributed  aggregate number of shares of
     to the operating partnership; or  beneficial interest or the number of
     the issuance of the limited       shares of any class of shares of
     partnership interests has been    beneficial interest that Vornado has
     approved by the holders of a      authority to issue. Under the
     majority of the class D units     declaration of trust, holders of
     issued in 1997 and then           common shares do not have any
     outstanding.                      preemptive rights to subscribe to any
    The interests with respect to      securities of Vornado.
cash available for distribution of
the limited partners in the operating
partnership may be diluted if
Vornado, in its sole discretion,
causes the operating partnership to
issue additional units or other
equity securities.

                             MANAGEMENT CONTROL
    All management powers over the         The Board of Trustees has
business and affairs of the operating  exclusive control over the management
partnership are vested in Vornado as   of Vornado's business and affairs,
the general partner of the operating   limited only by express restrictions
partnership, and no limited partner    on the Board's control in the
of the operating partnership has any   declaration of trust and bylaws, the
right to participate in or exercise    partnership agreement and applicable
control or management power over the   law. The Board of Trustees is
business and affairs of the operating  classified into three classes of
partnership, except as described       trustees. At each annual meeting of
under 'Description of                  the shareholders of Vornado, the
units -- Borrowing by the operating    successors of the class of trustees
partnership' and ' -- Sales of         whose terms expire at that meeting
Assets.'                               are elected.
Vornado may not be removed as general  The policies adopted by the Board of
partner by the limited partners with   Trustees may be altered or eliminated
or without cause.                      without a vote of the shareholders.
                                       Accordingly, except for their vote in
                                       the elections of trustees,

                                       55

                                    
    THE OPERATING PARTNERSHIP              VORNADO
                                       shareholders have no control over the
                                       ordinary business policies of
                                       Vornado.
    Because a portion of the Board of Trustees is elected each year by the
shareholders at Vornado's annual meeting, the shareholders have greater
control over the management of Vornado than the limited partners have over
the operating partnership.

                   DUTIES OF GENERAL PARTNER AND TRUSTEES
    Under Delaware law, Vornado, as        Under Maryland law, there is no
the general partner of the operating   statute specifying the duties of
partnership, is accountable to the     trustees of a REIT like Vornado.
operating partnership as a fiduciary   However, counsel to Vornado believes
and, consequently, is required to      that it is likely that a Maryland
exercise good faith and integrity in   court would refer to the Maryland
all of its dealings with respect to    General Corporation Law, which
partnership affairs. However, under    requires directors of a Maryland
the partnership agreement, Vornado is  corporation to perform their duties
expressly under no obligation to       in good faith, in a manner that they
consider the separate interests of     reasonably believe to be in the best
the limited partners in deciding       interests of the corporation and with
whether to cause the operating         the care of an ordinarily prudent
partnership to take or decline to      person in a like position under
take any actions, and Vornado is not   similar circumstances. The Maryland
liable for monetary damages for        General Corporation Law presumes that
losses sustained, liabilities          a director's standard of care has
incurred or benefits not derived by    been satisfied.
limited partners as a result of
Vornado's decisions, provided that
the general partner has acted in good
faith.

                  MANAGEMENT LIABILITY AND INDEMNIFICATION
    As a matter of Delaware law, the       The Maryland REIT law permits a
general partner has liability for the  Maryland real estate investment trust
payment of the obligations and debts   to include in its declaration of
of the operating partnership unless    trust a provision limiting the
limitations upon this liability are    liability of its trustees, officers,
stated in the document or instrument   employees and agents to the trust and
evidencing the obligation. Under the   its shareholders for money damages
partnership agreement, the operating   except for liability resulting from:
partnership has agreed to indemnify    actual receipt of any improper
Vornado and any trustee or officer of   benefit or profit in money, property
Vornado from and against all losses,    or services; or
claims, damages, liabilities, joint    active and deliberate dishonesty
or several, expenses including legal    material to the cause of action
fees, fines, settlements and other      established by a final judgment.
amounts incurred in connection with
any actions

                                       56

                                    
    THE OPERATING PARTNERSHIP              VORNADO
    relating to the operations of the  The declaration of trust of Vornado
operating partnership as described in  contains a provision of this kind
the partnership agreement in which     which eliminates the liability of
Vornado or any such trustee or         Vornado's trustees and officers to
officer is involved, unless:           Vornado and its shareholders to the
     the act was in bad faith or the   maximum extent permitted by the
     result of active and deliberate   Maryland REIT law. Vornado's
     dishonesty and was material to    declaration of trust authorizes it,
     the action;                       to the extent permitted in the
     the party seeking                 bylaws, to indemnify, and to pay or
     indemnification received an       reimburse reasonable expenses to, as
     improper personal benefit; or     they are incurred by, each trustee or
     in the case of any criminal       officer, including any person who,
     proceeding, the party seeking     while a trustee of Vornado, is or was
     indemnification had reasonable    serving at the request of Vornado as
     cause to believe the act was      a director, officer, partner,
     unlawful.                         trustee, employee or agent of another
    The reasonable expenses incurred   foreign or domestic corporation,
by an indemnified party may be         partnership, joint venture, trust,
advanced by the operating partnership  other enterprise or employee benefit
before the final disposition of the    plan, from all claims and liabilities
proceeding upon receipt by the         to which the indemnified person may
operating partnership of an            become subject by reason of being or
affirmation by the indemnified person  having been a trustee or officer.
of his, her or its good faith belief   Vornado's bylaws require it to
that the standard of conduct           indemnify to the maximum extent
necessary for indemnification has      permitted by the Maryland REIT law:
been met and an undertaking by the     any present or former trustee or
indemnified person to repay the         officer, including, without
amount if it is determined that this    limitation, any individual who,
standard was not met.                   while a trustee or officer and at
                                        the request of Vornado, serves or
                                        has served another corporation,
                                        partnership, joint venture, trust,
                                        employee benefit plan or any other
                                        enterprise as a director, officer,
                                        partner or trustee of that
                                        corporation, partnership, joint
                                        venture, trust, employee benefit
                                        plan or other enterprise, who has
                                        been successful, on the merits or
                                        otherwise, in the defense of a
                                        proceeding to which he was made a
                                        party by reason of that status,
                                        against reasonable

                                       57

                                    
    THE OPERATING PARTNERSHIP              VORNADO
                                        expenses incurred by him in
                                        connection with the proceeding; and
                                       any present or former trustee or
                                        officer against any claim or
                                        liability to which that person may
                                        become subject by reason of that
                                        status unless it is established that
                                        (a) that person's act or omission
                                        was material to the cause of action
                                        giving rise to the proceeding and
                                        was committed in bad faith or was
                                        the result of active and deliberate
                                        dishonesty, (b) he or she actually
                                        received an improper personal
                                        benefit in money, property or
                                        services or (c) in the case of a
                                        criminal proceeding, he or she had
                                        reasonable cause to believe that his
                                        or her act or omission was unlawful.
                                       In addition, Vornado's bylaws require
                                       Vornado to pay or reimburse, in
                                       accordance with the Maryland REIT
                                       law, in advance of final disposition
                                       of a proceeding, reasonable expenses
                                       incurred by a present or former
                                       trustee or officer made a party to a
                                       proceeding by reason of that status,
                                       provided that Vornado has received
                                       a written affirmation by the trustee
                                        or officer of his good faith belief
                                        that he has met the applicable
                                        standard of conduct necessary for
                                        indemnification by Vornado as
                                        authorized by the bylaws; and
                                       a written undertaking by him or on
                                        his behalf to repay the amount paid
                                        or reimbursed by Vornado if it is
                                        ultimately determined that the
                                        applicable standard of conduct was
                                        not met.

                                       58

                                    
    THE OPERATING PARTNERSHIP              VORNADO
                                       Vornado's bylaws also:
                                       permit Vornado to provide
                                        indemnification and payment or
                                        reimbursement of expenses to a
                                        present or former trustee or officer
                                        who served a predecessor of Vornado
                                        in that capacity and to any employee
                                        or agent of Vornado or a predecessor
                                        of Vornado;
                                       provide that any indemnification or
                                        payment or reimbursement of the
                                        expenses permitted by the bylaws
                                        shall be furnished in accordance
                                        with the procedures provided for
                                        indemnification or payment or
                                        reimbursement of expenses, as the
                                        case may be, under Section 2-418 of
                                        the Maryland General Corporation Law
                                        for directors of Maryland
                                        corporations; and
                                       permit Vornado to provide any other
                                        and further indemnification or
                                        payment or reimbursement of expenses
                                        that may be permitted by the
                                        Maryland General Corporation Law for
                                        Directors of Maryland corporations.
                                       The Maryland REIT law permits a
                                       Maryland real estate investment trust
                                       to indemnify and advance expenses to
                                       its trustees, officers, employees and
                                       agents to the same extent as
                                       permitted by the Maryland General
                                       Corporation Law for directors and
                                       officers of Maryland corporations.
                                       The Maryland General Corporation Law
                                       permits a corporation to indemnify
                                       its present and former directors and
                                       officers, among others, against
                                       judgments, penalties, fines,
                                       settlements and reasonable expenses
                                       actually incurred by them in

                                       59

                                    
    THE OPERATING PARTNERSHIP              VORNADO
                                       connection with any proceeding to
                                       which they may be made a party by
                                       reason of their service in those or
                                       other capacities unless it is
                                       established that:
                                       the act or omission of the director
                                        or officer was material to the
                                        matter giving rise to the proceeding
                                        and (a) was committed in bad faith
                                        or (b) was the result of active and
                                        deliberate dishonesty;
                                       the director or officer actually
                                        received an improper personal
                                        benefit in money, property or
                                        services; or
                                       in the case of any criminal
                                        proceeding, the director or officer
                                        had reasonable cause to believe that
                                        the act or omission was unlawful.
                                       However, under the Maryland General
                                       Corporation Law, a Maryland
                                       corporation may not indemnify for an
                                       adverse judgment in a suit by or in
                                       the right of the corporation or for a
                                       judgment of liability on the basis
                                       that personal benefit was improperly
                                       received, unless in either case a
                                       court orders indemnification and then
                                       only for expenses. In addition, the
                                       Maryland General Corporation Law
                                       permits a corporation to advance
                                       reasonable expenses to a director or
                                       officer upon the corporation's
                                       receipt of:
                                       a written affirmation by the director
                                        or officer of his good faith belief
                                        that he has met the standard of
                                        conduct necessary for
                                        indemnification by the corporation;
                                        and
                                       a written undertaking by him or on
                                        his behalf to repay the

                                       60

                                    
    THE OPERATING PARTNERSHIP              VORNADO
                                        amount paid or reimbursed by the
                                        corporation if it is ultimately
                                        determined that the standard of
                                        conduct was not met.
    Thus, the management of the operating partnership and Vornado have
substantially the same rights to indemnification.

                           LIABILITY OF INVESTORS
    Under the partnership agreement        Under the Maryland REIT law,
and applicable state law, the          shareholders are not personally
liability of the limited partners for  liable for the obligations of
the operating partnership's debts and  Vornado. The common shares, upon
obligations generally is limited to    issuance, will be fully paid and
the amount of their investments in     nonassessable.
the operating partnership, together
with their interest in the operating
partnership's undistributed income,
if any.
    Thus, the limited partners in the operating partnership and the
shareholders of Vornado have substantially the same limited personal
liability.

                               VOTING RIGHTS
    Under the partnership agreement,       The business and affairs of
the limited partners have limited      Vornado are managed under the
voting rights. The limited partners    direction of the Board of Trustees,
have the right to vote on any          which currently consists of seven
proposed action of the general         members in classes having three-year
partner that would contravene any      staggered terms of office. One class
express prohibition or limitation in   is elected by the shareholders at
the partnership agreement, and any     each annual meeting of Vornado
such action requires unanimous         shareholders. Maryland law requires
approval by the limited partners. The  that certain major corporate
limited partners do not have the       transactions, including most
right to vote on any proposed sale,    amendments to the declaration of
exchange, transfer or disposal of all  trust, may be consummated only with
or substantially all of the assets of  the approval of shareholders. The
the operating partnership, except as   declaration of trust permits any
required under the lock-out            action which may be taken at a
provisions. See 'Description of        meeting of shareholders to be taken
units -- Sales of assets.' In          without a meeting if a written
addition, the limited partners do not  consent to the action is signed by
have the right to propose amendments   holders of outstanding shares of
to the partnership agreement and       beneficial interest having not less
their rights to vote on amendments     than the minimum number of votes that
are restricted as described under the  would be necessary to authorize or
caption 'Description of                take the action at a meeting at which
units -- Amendment of the partnership  all shares
agreement.' Any

                                       61

                                    
    THE OPERATING PARTNERSHIP              VORNADO
    amendment which requires the       entitled to vote were present and
approval of the limited partners may   voted. Vornado had 5,789,239
be approved by a majority of the       convertible series A preferred
limited partners, except that any      shares, 3,400,000 cumulative
amendment which would change the       redeemable series B preferred shares,
limited liability of a limited         and 4,600,000 cumulative redeemable
partner, change the voting             series C preferred shares issued and
requirements for specified actions or  outstanding as of December 31, 1999.
amendments under the partnership       The holders of preferred shares
agreement or change specified          generally have no right to vote,
provisions in the partnership          except that:
agreement with respect to              if and whenever six quarterly
distributions and allocations or the    dividends, whether or not
right to redeem units must be           consecutive, payable on either
approved by each limited partner        series of preferred shares are in
adversely affected by the amendment.    arrears, which, with respect to any
In addition, some series of preferred   quarterly dividend, means that the
units have special voting rights that   dividend has not been paid in full,
require their consent for actions       whether or not the dividend was
that would adversely affect their       earned or declared, the holders of
preferences.                            that series will have the right,
                                        voting as a class, to elect two
                                        additional Trustees; and
                                       so long as any preferred shares are
                                        outstanding, the affirmative vote of
                                        at least two-thirds of the
                                        outstanding preferred shares and all
                                        other series of voting preferred
                                        shares, voting as a single class
                                        regardless of series, will be
                                        necessary to (a) amend, alter or
                                        repeal the declaration of trust so
                                        as to materially and adversely
                                        affect the voting powers, rights or
                                        preferences of the holders of the
                                        preferred share or (b) authorize,
                                        create or increase the authorized
                                        amount of any shares ranking prior
                                        to the preferred shares in the
                                        distribution of assets or any
                                        liquidation or in the payment of
                                        dividends.

                                       62

                                    
    THE OPERATING PARTNERSHIP              VORNADO
                                       The Board of Trustees has the power,
                                       however, to create additional classes
                                       of parity and junior shares, increase
                                       the authorized number of parity and
                                       junior shares, and issue additional
                                       series of parity and junior shares
                                       without the consent of any holder of
                                       preferred shares.

    AMENDMENT OF THE PARTNERSHIP AGREEMENT OR THE DECLARATION OF TRUST
    Vornado generally has the power,       Under the Maryland REIT law and
without the consent of any limited     the declaration of trust, the
partners, to amend the partnership     trustees, by a two-thirds vote, may
agreement as may be required to        at any time amend the declaration of
reflect any changes that Vornado       trust, without the approval of
deems necessary or appropriate in its  shareholders, to enable Vornado to
sole discretion, provided that the     qualify as a REIT under the Internal
amendment does not adversely affect    Revenue Code or as a real estate
or eliminate any right granted to a    investment trust under the Maryland
limited partner that is protected by   REIT law. As permitted by the
specified special voting provisions.   Maryland REIT law, the declaration of
See 'Description of                    trust authorizes Vornado's Board of
units -- Amendment of the partnership  Trustees, without any action by the
agreement' for further information     shareholders, to amend the
about Vornado's power to amend the     declaration of trust from time to
partnership agreement and the limits   time to increase or decrease the
on that power.                         aggregate number of shares of
                                       beneficial interest or the number of
                                       shares of beneficial interest of any
                                       class that Vornado is authorized to
                                       issue. Except for certain specified
                                       amendments which require the vote of
                                       the holders of two-thirds of the
                                       outstanding shares, other amendments
                                       to the declaration of trust require
                                       the vote of holders of a majority of
                                       the outstanding shares, as defined in
                                       the declaration of trust.

                          REVIEW OF INVESTOR LISTS
    Under the partnership agreement,       Under the Maryland General
limited partners in the operating      Corporation Law, as applicable to
partnership, upon written demand with  REITs, one or more shareholders
a statement of the purpose of the      holding of record for at least six
demand and at the limited partner's    months at least 5% of the outstanding
expense, are entitled to obtain a      shares of beneficial interest of any
current list of the name and last      class of a real estate investment
known                                  trust

                                       63

                                    
    THE OPERATING PARTNERSHIP              VORNADO
    business, residence or mailing     may, upon written request, inspect
address of each limited partner of     and copy during usual business hours
the operating partnership.             the share ledger of the real estate
                                       investment trust or, if the real
                                       estate investment trust does not
                                       maintain an original or duplicate
                                       share ledger at its principal office,
                                       obtain a verified list of
                                       shareholders, setting forth their
                                       names and addresses and the number of
                                       shares of each class held by each
                                       shareholder.
    Thus, the limited partners in the operating partnership and the
shareholders of Vornado have similar rights to inspect and, at their own
expense, make copies of investor lists, with some limitations.

                        REVIEW OF BOOKS AND RECORDS
    Under the partnership agreement,       Under the Maryland General
limited partners in the operating      Corporation Law, as applicable to
partnership, upon written demand with  REITs, any shareholder or his agent
a statement of the purpose of the      may inspect and copy during normal
demand and at the limited partner's    business hours the following real
expense, are entitled to obtain a      estate investment trust documents:
copy of the operating partnership's    bylaws;
Federal, state and local income tax    minutes of the proceedings of
returns, to obtain a copy of the most   shareholders;
recent annual and quarterly reports    annual statements of affairs; and
filed by Vornado with the SEC and to    voting trust agreements on file at
obtain some other records and           the real estate investment trust's
information as provided in the          principal office.
partnership agreement. Limited         In addition, one or more shareholders
partners in the operating partnership  holding of record at least 5% of the
do not have any right to inspect the   outstanding shares of beneficial
books of the operating partnership.    interest of any class of a real
                                       estate investment trust may, upon
                                       written request, inspect and copy
                                       during usual business hours the books
                                       of account of the real estate
                                       investment trust.

                       ISSUANCE OF ADDITIONAL EQUITY
    The operating partnership is           The Board of Trustees may
generally authorized to issue units    authorize the issuance, in its
and other partnership interests,       discretion, of additional common
including partnership interests of     shares and other equity securities of
different series                       Vornado, including

                                       64

                                    
    THE OPERATING PARTNERSHIP              VORNADO
    or classes, as determined by       one or more classes of common or
Vornado as the general partner in its  preferred shares, with the
sole discretion. The operating         preferences, conversion or other
partnership may issue units and other  rights, voting powers, restrictions,
partnership interests to Vornado, as   limitations as to dividends,
long as these interests are issued in  qualifications and terms and
connection with a comparable issuance  conditions of redemption that the
of securities of Vornado and proceeds  Board of Trustees may establish.
raised in connection with the
issuance of the Vornado securities
are contributed to the operating
partnership. The terms of some series
of preferred units limit Vornado's
ability to issue other series of
units ranking prior to them.
    The operating partnership and Vornado both have substantial flexibility
to raise equity through the sale of additional units, shares of beneficial
interest or other securities to finance the business and affairs of the
operating partnership.

                             BORROWING POLICIES
    The operating partnership has no       Vornado is not restricted under
restrictions on borrowings, and            its declaration of trust from
Vornado as general partner has full    borrowing. However, under the
power and authority to borrow money    partnership agreement, Vornado, as
on behalf of the operating             general partner, may not issue debt
partnership. However, under the terms  securities or otherwise incur any
of the lockup provisions, the          debts unless it contributes the
operating partnership is limited in    proceeds from the incurrence of debts
its ability to refinance the           to the operating partnership.
indebtedness secured by some of its    Therefore, all indebtedness incurred
properties, unless affected limited    by Vornado will be for the benefit of
partners are compensated for adverse   the operating partnership.
tax consequences in accordance with
the lockup agreements. See
'Description of units and the
operating partnership -- Borrowing by
the operating partnership' for
further information about the lockup
agreements.

                           PERMITTED INVESTMENTS
    The operating partnership's            Under its declaration of trust,
purpose is to conduct any business     Vornado may engage in any lawful
that may be lawfully conducted by a    activity permitted by the Maryland
Delaware limited partnership,          REIT law. Under the partnership
provided that this business is to be   agreement, Vornado, as general
conducted in a manner that permits     partner, agrees that it will not,
Vornado to be qualified as a REIT      directly or indirectly, enter into or
unless Vornado                         conduct any business

                                       65

                                    
    THE OPERATING PARTNERSHIP              VORNADO
    ceases to qualify as a REIT for    other than in connection with the
any reason. The operating partnership  ownership, acquisition and
is authorized to perform any and all   disposition of partnership interests
acts for the furtherance of the        in the operating partnership except
purposes and business of the           with the consent of a majority of the
operating partnership, including       holders of common units other than
making investments, provided that the  Vornado.
Operating partnership may not take,    Vornado is also permitted to acquire,
or refrain from taking, any action     directly or indirectly, up to 1%
which, in the judgment of Vornado as   interest in any partnership or
general partner:                       limited liability company at least
     could adversely affect the        ninety-nine percent (99%) of whose
     ability of the general partner    equity is owned by the operating
     to continue to qualify as a       partnership.
     REIT;
     could subject the general
     partner to any additional taxes
     under Section 857 or Section
     4981 of the Internal Revenue
     Code; or
     could violate any law or
     regulation of any governmental
     body.
    The operating partnership may
take any action or inaction described
in the preceding sentence only with
Vornado's specific consent.
    Vornado and the operating partnership may invest in any types of real
estate and geographic areas that Vornado deems appropriate. Subject to
restrictions relating to the protection of Vornado's REIT status, the
operating partnership may perform all acts necessary for the furtherance of
the operating partnership's business, including diversifying its portfolio
to protect the value of its assets or as a prudent hedge against the risk of
having too many of its investments limited to a single asset group or in a
particular region of the country. Vornado, as general partner of the
operating partnership, generally may not conduct any business other than
through the operating partnership without the consent of the holders of a
majority of the common limited partnership interests, not including the
limited partnership interests held by Vornado in its capacity as a limited
partner in the operating partnership.

                       OTHER INVESTMENT RESTRICTIONS
    Other than restrictions                Vornado's declaration of trust
precluding investments by the          authorizes Vornado to enter into any
operating partnership that would       contract or transaction of any kind,
adversely affect the qualification of  including the purchase or sale of
Vornado as a REIT and restrictions on  property, with any person, including
transactions with affiliates, the      any trustee, officer, employee or
partnership agreement                  agent of

                                       66

                                    
    THE OPERATING PARTNERSHIP              VORNADO
    does not generally restrict the    Vornado, whether or not any of them
operating partnership's authority to   has a financial interest in the
make investments, lend operating       transaction.
partnership funds or reinvest the
operating partnership's cash flow and
net sale or refinancing proceeds.

                                       67

                       FEDERAL INCOME TAX CONSIDERATIONS

    This section summarizes the taxation of Vornado and the material Federal
income tax consequences to holders of the common shares for your general
information only. It is not tax advice. The tax treatment of a holder of common
shares will vary depending upon the holder's particular situation, and this
discussion addresses only holders that hold common shares as capital assets and
does not deal with all aspects of taxation that may be relevant to particular
holders in light of their personal investment or tax circumstances. This section
also does not deal with all aspects of taxation that may be relevant to certain
types of holders to which special provisions of the Federal income tax laws
apply, including:

     broker-dealers;

     traders in securities that elect to mark-to-market;

     banks;

     tax-exempt organizations;

     certain insurance companies;

     persons liable for the alternative minimum tax;

     persons that hold securities that are a hedge, that are hedged against
     currency risks or that are part of a straddle or conversion transaction;
     and

     persons whose functional currency is not the U.S. dollar.

    This summary is based on the Internal Revenue Code, its legislative history,
existing and proposed regulations under the Internal Revenue Code, published
rulings and court decisions. This summary describes the provisions of these
sources of law only as they are currently in effect. All of these sources of law
may change at any time, and any change in the law may apply retroactively.

    WE URGE YOU TO CONSULT WITH YOUR OWN TAX ADVISORS REGARDING THE TAX
CONSEQUENCES TO YOU OF ACQUIRING, OWNING AND SELLING COMMON SHARES, INCLUDING
THE FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF ACQUIRING, OWNING AND
SELLING COMMON SHARES IN YOUR PARTICULAR CIRCUMSTANCES AND POTENTIAL CHANGES IN
APPLICABLE LAWS.

                         TAXATION OF VORNADO AS A REIT

    In the opinion of Sullivan & Cromwell, commencing with its taxable year
ended December 31, 1993, Vornado has been organized and operated in conformity
with the requirements for qualification and taxation as a REIT under the
Internal Revenue Code, and Vornado's proposed method of operation will enable it
to continue to meet the requirements for qualification and taxation as a REIT
under the Code. Investors should be aware, however, that opinions of counsel are
not binding upon the Internal Revenue Service or any court.

                                       68

    In providing its opinion, Sullivan & Cromwell is relying,

     as to certain factual matters upon the statements and representations
     contained in certificates provided to Sullivan & Cromwell by Vornado and
     Two Penn Plaza, REIT, Inc.;

     without independent investigation, as to certain factual matters upon the
     statements and representations contained in the certificate provided to
     Sullivan & Cromwell by Alexander's; and

     without independent investigation, upon the opinion of Shearman & Sterling
     concerning the qualification of Alexander's as a REIT for each taxable year
     commencing with its taxable year ending December 31, 1995.

    In providing its opinion regarding the qualification of Alexander's as a
REIT for Federal income tax purposes, Shearman & Sterling is relying, as to
certain factual matters, upon representations received from Alexander's.

    Vornado's qualification as a REIT will depend upon the continuing
satisfaction by Vornado and, given Vornado's current ownership interest in
Alexander's and Two Penn, by Alexander's and Two Penn, of the requirements of
the Internal Revenue Code relating to qualification for REIT status. Some of
these requirements depend upon actual operating results, distribution levels,
diversity of stock ownership, asset composition, source of income and
recordkeeping. Accordingly, while Vornado intends to continue to qualify to be
taxed as a REIT, the actual results of Vornado's, Two Penn's or Alexander's
operations for any particular year might not satisfy these requirements. Neither
Sullivan & Cromwell nor Shearman & Sterling will monitor the compliance of
Vornado, Two Penn or Alexander's with the requirements for REIT qualification on
an ongoing basis.

    The sections of the Internal Revenue Code applicable to REITs are highly
technical and complex. The following discussion summarizes material aspects of
these sections of the Internal Revenue Code.

    As a REIT, Vornado generally will not have to pay Federal corporate income
taxes on its net income that it currently distributes to shareholders. This
treatment substantially eliminates the 'double taxation' at the corporate and
shareholder levels that generally results from investment in a regular
corporation.

    However, Vornado will have to pay federal income tax as follows.

     First, Vornado will have to pay tax at regular corporate rates on any
     undistributed real estate investment trust taxable income, including
     undistributed net capital gains.

     Second, under certain circumstances, Vornado may have to pay the
     alternative minimum tax on its items of tax preference.

     Third, if Vornado has (a) net income from the sale or other disposition of
     foreclosure property, as defined in the Internal Revenue Code, which is
     held primarily for sale to customers in the ordinary course of business or
     (b) other non-qualifying income from foreclosure property, it will have to
     pay tax at the highest corporate rate on that income.

                                       69

     Fourth, if Vornado has net income from 'prohibited transactions', as
     defined in the Internal Revenue Code, Vornado will have to pay a 100% tax
     on that income. Prohibited transactions are, in general, certain sales or
     other dispositions of property, other than foreclosure property, held
     primarily for sale to customers in the ordinary course of business.

     Fifth, if Vornado should fail to satisfy the 75% gross income test or the
     95% gross income test, as discussed below under ' -- Requirements for
     qualification -- Income tests', but has nonetheless maintained its
     qualification as a REIT because Vornado has satisfied some other
     requirements, it will have to pay a 100% tax on an amount equal to (a) the
     gross income attributable to the greater of the amount by which Vornado
     fails the 75% or 95% test, multiplied by (b) a fraction intended to reflect
     Vornado's profitability.

     Sixth, if Vornado should fail to distribute during each calendar year at
     least the sum of (a) 85% of its real estate investment trust ordinary
     income for that year, (b) 95% of its real estate investment trust capital
     gain net income for that year and (c) any undistributed taxable income from
     prior periods, Vornado would have to pay a 4% excise tax on the excess of
     that required distribution over the amounts actually distributed.

     Seventh, if during the 10-year period beginning on the first day of the
     first taxable year for which Vornado qualified as a REIT, Vornado
     recognizes gain on the disposition of any asset held by Vornado as of the
     beginning of that period, then, to the extent of the excess of (a) fair
     market value of that asset as of the beginning of that period over
     (b) Vornado's adjusted basis in that asset as of the beginning of that
     period, Vornado will have to pay tax on that gain at the highest regular
     corporate rate under Treasury regulations that have not yet been
     promulgated. We refer to the excess of fair market value over adjusted
     basis described in the preceding sentence as 'built-in gain'.

     Notwithstanding the taxation of built-in gain described in the preceding
     paragraph of this bullet point, Vornado will not have to pay tax on
     recognized built-in gain with respect to assets held as of the first day of
     the 10-year period beginning on the first day of the first taxable year for
     which Vornado qualified as a REIT, to the extent that the aggregate amount
     of that recognized built-in gain exceeds the net aggregate amount of
     Vornado's unrealized built-in gain as of the first day of that period.

     Eighth, if Vornado acquires any asset from a C corporation in certain
     transactions in which Vornado must adopt the basis of the asset or any
     other property in the hands of the C corporation as the basis of the asset
     in the hands of Vornado, and Vornado recognizes gain on the disposition of
     that asset during the 10-year period beginning on the date on which Vornado
     acquired that asset, then Vornado will have to pay tax on the built-in gain
     at the highest regular corporate rate. A C corporation means generally a
     corporation that has to pay full corporate-level tax.

                                       70

     Ninth, for taxable years beginning after December 31, 2000, if Vornado
     receives non-arms length income from a taxable REIT subsidiary (as defined
     under ' -- Asset tests'), or as a result of services provided by a taxable
     REIT subsidiary to tenants of the trust, Vornado will be subject to a 100%
     tax on the amount of Vornado's non-arms length income.

REQUIREMENTS FOR QUALIFICATION

    The Internal Revenue Code defines a REIT as a corporation, trust or
association

     which is managed by one or more trustees or directors;

     the beneficial ownership of which is evidenced by transferable shares, or
     by transferable certificates of beneficial interest;

     which would otherwise be taxable as a domestic corporation, but for
Sections 856 through 859 of the Code;

     which is neither a financial institution nor an insurance company to which
     certain provisions of the Code apply;

     the beneficial ownership of which is held by 100 or more persons;

     during the last half of each taxable year, not more than 50% in value of
     the outstanding stock of which is owned, directly or constructively, by
     five or fewer individuals, as defined in the Internal Revenue Code to
     include certain entities; and

     which meets certain other tests, described below, regarding the nature of
     its income and assets.

The Internal Revenue Code provides that the conditions described in the first
through fourth bullet points above must be met during the entire taxable year
and that the condition described in the fifth bullet point above must be met
during at least 335 days of a taxable year of 12 months, or during a
proportionate part of a taxable year of less than 12 months.

    Vornado has satisfied the conditions described in the first through fifth
bullet points of the preceding paragraph and believes that it has also satisfied
the condition described in the sixth bullet point of the preceding paragraph. In
addition, Vornado's declaration of trust provides for restrictions regarding the
ownership and transfer of Vornado's shares of beneficial interest. These
restrictions are intended to assist Vornado in continuing to satisfy the share
ownership requirements described in the fifth and sixth bullet points of the
preceding paragraph. The ownership and transfer restrictions pertaining to the
common shares are described above under the heading 'Description of common
shares -- Restrictions on ownership of common shares.'

    Vornado owns a number of wholly-owned subsidiaries. Internal Revenue Code
Section 856(i) provides that a corporation which is a 'qualified REIT
subsidiary', as defined in the Code, will not be treated as a separate
corporation, and all assets, liabilities, and items of income, deduction, and
credit of a qualified REIT subsidiary will be treated as assets, liabilities and
items of these kinds of

                                       71

the REIT. Thus, in applying the requirements described in this section,
Vornado's qualified REIT subsidiaries will be ignored, and all assets,
liabilities and items of income, deduction, and credit of such subsidiaries will
be treated as assets, liabilities and items of these kinds of Vornado. Vornado
believes that all of its wholly-owned subsidiaries are qualified REIT
subsidiaries.

    If a REIT is a partner in a partnership, Treasury regulations provide that
the REIT will be deemed to own its proportionate share of the assets of the
partnership and will be deemed to be entitled to the income of the partnership
attributable to that share. In addition, the character of the assets and gross
income of the partnership will retain the same character in the hands of the
REIT for purposes of Section 856 of the Internal Revenue Code, including
satisfying the gross income tests and the asset tests. Thus, Vornado's
proportionate share of the assets, liabilities and items of income of any
partnership in which Vornado is a partner, including the operating partnership,
will be treated as assets, liabilities and items of income of Vornado for
purposes of applying the requirements described in this section. Thus, actions
taken by partnerships in which Vornado owns an interest either directly or
through one or more tiers of partnerships or qualified REIT subsidiaries, can
affect Vornado's ability to satisfy the REIT income and assets tests and the
determination of whether Vornado has net income from prohibited transactions.
See the fourth bullet point on page 70 for a discussion of prohibited
transactions.

    INCOME TESTS. In order to maintain its qualification as a REIT, Vornado
annually must satisfy three gross income requirements.

     First, Vornado must derive at least 75% of its gross income, excluding
     gross income from prohibited transactions, for each taxable year directly
     or indirectly from investments relating to real property or mortgages on
     real property, including 'rents from real property', as defined in the
     Internal Revenue Code, or from certain types of temporary investments.
     Rents from real property generally include expenses of Vornado that are
     paid or reimbursed by tenants.

     Second, at least 95% of Vornado's gross income, excluding gross income from
     prohibited transactions, for each taxable year must be derived from real
     property investments as described in the preceding bullet point, dividends,
     interest and gain from the sale or disposition of stock or securities, or
     from any combination of these types of source.

     Third, for its taxable years before 1998, short-term gain from the sale or
     other disposition of stock or securities, gain from prohibited transactions
     and gain on the sale or other disposition of real property held for less
     than four years, apart from involuntary conversions and sales of
     foreclosure property, was required to represent less than 30% of Vornado's
     gross income, including gross income from prohibited transactions, for each
     of these taxable years.

                                       72

    Rents that Vornado receives will qualify as rents from real property in
satisfying the gross income requirements for a REIT described above only if the
rents satisfy several conditions.

     First, the amount of rent must not be based in whole or in part on the
     income or profits of any person. However, an amount received or accrued
     generally will not be excluded from rents from real property solely because
     it is based on a fixed percentage or percentages of receipts or sales.

     Second, the Internal Revenue Code provides that rents received from a
     tenant will not qualify as rents from real property in satisfying the gross
     income tests if the REIT, directly or under the applicable attribution
     rules, owns a 10% or greater interest in that tenant; provided, however,
     that for tax years beginning after December 31, 2000, rent received from a
     taxable REIT subsidiary (as defined under ' -- Asset tests', below) will,
     under certain circumstances, qualify as rents from real property even if
     Vornado owns more than a 10% interest in such subsidiary. We refer to a
     tenant in which Vornado owns a 10% or greater interest as a 'related party
     tenant.'

     Third, if rent attributable to personal property leased in connection with
     a lease of real property is greater than 15% of the total rent received
     under the lease, then the portion of rent attributable to the personal
     property will not qualify as rents from real property.

     Finally, for rents received to qualify as rents from real property, the
     REIT generally must not operate or manage the property or furnish or render
     services to the tenants of the property, other than through an independent
     contractor from whom the REIT derives no revenue or through a taxable REIT
     subsidiary. However, Vornado may directly perform certain services that
     landlords usually or customarily render when renting space for occupancy
     only or that are not considered rendered to the occupant of the property.

Vornado does not derive significant rents from related party tenants. Vornado
also does not and will not derive rental income attributable to personal
property, other than personal property leased in connection with the lease of
real property, the amount of which is less than 15% of the total rent received
under the lease.

    Vornado directly performs services for some of its tenants. Vornado does not
believe that the provision of these services will cause its gross income
attributable to these tenants to fail to be treated as rents from real property.
If Vornado were to provide services to a tenant that are other than those
landlords usually or customarily provide when renting space for occupancy only,
amounts received or accrued by Vornado for any of these services will not be
treated as rents from real property for purposes of the REIT gross income tests.
However, the amounts received or accrued for these services will not cause other
amounts received with respect to the property to fail to be treated as rents
from real property unless the amounts treated as received in respect of the
services, together with amounts received for certain management services,
exceeds 1% of all amounts received or accrued by Vornado during the taxable year
with respect to the property. If the sum of the amounts received in respect of
the services to

                                       73

tenants and management services described in the preceding sentence exceeds the
1% threshold, then all amounts received or accrued by Vornado with respect to
the property will not qualify as rents from real property, even if Vornado
provides the impermissible services to some, but not all, of the tenants of the
property.

    The term 'interest' generally does not include any amount received or
accrued, directly or indirectly, if the determination of that amount depends in
whole or in part on the income or profits of any person. However, an amount
received or accrued generally will not be excluded from the term interest solely
because it is based on a fixed percentage or percentages of receipts or sales.

    If Vornado fails to satisfy one or both of the 75% or 95% gross income tests
for any taxable year, it may nevertheless qualify as a REIT for that year if it
satisfies the requirements of other provisions of the Internal Revenue Code that
allow relief from disqualification as a REIT. These relief provisions will
generally be available if

     Vornado's failure to meet the income tests was due to reasonable cause and
     not due to willful neglect;

     Vornado attaches a schedule of the sources of its income to its Federal
     income tax return; and

     any incorrect information on the schedule was not due to fraud with intent
     to evade tax.

Vornado might not be entitled to the benefit of these relief provisions,
however. As discussed in the fifth bullet point on page 70, even if these relief
provisions apply, Vornado would have to pay a tax on the excess income.

    ASSET TESTS. Vornado, at the close of each quarter of its taxable year, must
also satisfy three tests relating to the nature of its assets.

     First, at least 75% of the value of Vornado's total assets must be
     represented by real estate assets, including (a) real estate assets held by
     Vornado's qualified REIT subsidiaries, Vornado's allocable share of real
     estate assets held by partnerships in which Vornado owns an interest and
     stock issued by another REIT, (b) for a period of one year from the date of
     Vornado's receipt of proceeds of an offering of its shares of beneficial
     interest or debt with a term of at least five years, stock or debt
     instruments purchased with these proceeds and (c) cash, cash items and
     government securities.

     Second, not more than 25% of Vornado's total assets may be represented by
     securities other than those in the 75% asset class.

     Third, for taxable years beginning prior to January 1, 2001, of the
     investments included in the 25% asset class, the value of any one issuer's
     securities, other than securities issued by another REIT, owned by Vornado
     may not exceed 5% of the value of Vornado's total assets and Vornado may
     not own more than 10% of any one issuer's outstanding voting securities.

                                       74

      Fourth, for taxable years beginning after December 31, 2000, not more than
      20% of Vornado's total assets may constitute securities issued by taxable
      REIT subsidiaries, and of the investments included in the 25% asset class,
      the value of any one issuer's securities, other than securities issued by
      another REIT or by a taxable REIT subsidiary, owned by Vornado may not
      exceed 5% of the value of Vornado's total assets and Vornado may not own
      more than 10% of the vote or value of the outstanding securities of any
      one issuer, except for issuers that are taxable REIT subsidiaries. For
      these purposes, a taxable REIT subsidiary is any corporation in which
      Vornado owns an interest, that joins with Vornado in making an election to
      be treated as a taxable REIT subsidiary and that does not engage in
      certain activities.

    The test described in Third, above, and not that described in Fourth, above,
will apply for taxable years of Vornado that begin after December 31, 2000, with
respect to stock in any corporation owned by Vornado prior to July 12, 1999, so
long as a taxable REIT subsidiary election is not made with respect to such
corporation and such corporation does not acquire substantial new assets or
engage in a substantial new line of business.

    Since March 2, 1995, Vornado has owned more than 10% of the voting
securities of Alexander's. Since April of 1997, Vornado's ownership of
Alexander's has been through the operating partnership rather than direct.
Vornado's ownership interest in Alexander's will not cause Vornado to fail to
satisfy the asset tests for REIT status so long as Alexander's qualified as a
REIT for each of taxable years beginning with its taxable year ending
December 31, 1995 and continues to so qualify. In the opinion of Shearman &
Sterling, commencing with Alexander's taxable year ended December 31, 1995,
Alexander's has been organized and operated in conformity with the requirements
for qualification and taxation as a REIT under the Internal Revenue Code, and
its proposed method of operation will enable it to continue to meet the
requirements for qualification and taxation as a REIT under the Internal Revenue
Code. In providing its opinion, Shearman & Sterling is relying upon
representations received from Alexander's.

    Since April of 1997, Vornado has also owned, through the operating
partnership, more than 10% of the voting securities of Two Penn. Vornado's
indirect ownership interest in Two Penn will not cause Vornado to fail to
satisfy the asset tests for REIT status so long as Two Penn qualifies as a REIT
for its first taxable year and each subsequent taxable year. Vornado believes
that Two Penn will also qualify.

    In order to ensure compliance with the 95% gross income test described in
the second bullet point on page 72, Vornado transferred certain contract rights
and obligations to VMC, a New Jersey corporation, in return for all of VMC's
nonvoting preferred stock. Since April of 1997, the operating partnership has
held this stock. This stock entitles its holder to 95% of the dividends paid by
VMC. Vornado does not believe that its indirect ownership of this stock will
adversely affect its ability to satisfy the asset tests described above.

                                       75

    Vornado also owns, through the operating partnership, nonvoting shares in a
number of corporations. Vornado does not believe that the characteristics or
value of these shares will cause Vornado to fail to satisfy the REIT asset tests
described above.

    ANNUAL DISTRIBUTION REQUIREMENTS. Vornado, in order to qualify as a REIT, is
required to distribute dividends, other than capital gain dividends, to its
shareholders in an amount at least equal to (1) the sum of (a) 95% of Vornado's
'real estate investment trust taxable income', computed without regard to the
dividends paid deduction and Vornado's net capital gain, and (b) 95% of the net
after-tax income, if any, from foreclosure property minus (2) the sum of certain
items of non-cash income.

    For taxable years beginning after December 31, 2000, the required amount of
distributions described above will be reduced from 95% to 90% of the amount of
Vornado's income or gain, as the case may be.

    In addition, if Vornado disposes of any asset within 10 years of acquiring
it, Vornado will be required, under Treasury regulations which the Treasury has
not yet promulgated, to distribute at least 95% of the after-tax built-in gain,
if any, recognized on the disposition of the asset.

    These distributions must be paid in the taxable year to which they relate,
or in the following taxable year if declared before Vornado timely files its tax
return for the year to which they relate and if paid on or before the first
regular dividend payment after the declaration.

    To the extent that Vornado does not distribute all of its net capital gain
or distributes at least 95%, but less than 100%, of its real estate investment
trust taxable income, as adjusted, it will have to pay tax on those amounts at
regular ordinary and capital gain corporate tax rates. Furthermore, if Vornado
fails to distribute during each calendar year at least the sum of (a) 85% of its
ordinary income for that year, (b) 95% of its capital gain net income for that
year, and (c) any undistributed taxable income from prior periods, Vornado would
have to pay a 4% excise tax on the excess of the required distribution over the
amounts actually distributed.

    Vornado intends to satisfy the annual distribution requirements.

    From time to time, Vornado may not have sufficient cash or other liquid
assets to meet the 95% distribution requirement due to timing differences
between (a) when Vornado actually receives income and when it actually pays
deductible expenses and (b) when Vornado includes the income and deducts the
expenses in arriving at its taxable income. If timing differences of this kind
occur, in order to meet the 95% distribution requirement, Vornado may find it
necessary to arrange for short-term, or possibly long-term, borrowings or to pay
dividends in the form of taxable stock dividends.

    Under certain circumstances, Vornado may be able to rectify a failure to
meet the distribution requirement for a year by paying 'deficiency dividends' to
shareholders in a later year, which may be included in Vornado's deduction for
dividends paid for the earlier year. Thus, Vornado may be able to avoid being

                                       76

taxed on amounts distributed as deficiency dividends; however, Vornado will be
required to pay interest based upon the amount of any deduction taken for
deficiency dividends.

FAILURE TO QUALIFY AS A REIT

    If Vornado fails to qualify for taxation as a REIT in any taxable year, and
the relief provisions do not apply, Vornado will have to pay tax, including any
applicable alternative minimum tax, on its taxable income at regular corporate
rates. Vornado will not be able to deduct distributions to shareholders in any
year in which it fails to qualify, nor will Vornado be required to make
distributions to shareholders. In this event, to the extent of current and
accumulated earnings and profits, all distributions to shareholders will be
taxable as ordinary income and corporate distributees may be eligible for the
dividends received deduction if they satisfy the relevant provisions of the
Internal Revenue Code. Unless entitled to relief under specific statutory
provisions, Vornado will also be disqualified from taxation as a REIT for the
four taxable years following the year during which qualification was lost.
Vornado might not be entitled to the statutory relief described in this
paragraph in all circumstances.

TAXATION OF HOLDERS OF COMMON SHARES

U.S. SHAREHOLDERS

    As used in this section, the term 'U.S. shareholder' means a holder of
common shares who, for United States Federal income tax purposes, is

     a citizen or resident of the United States;

     a corporation organized under the laws of the United States or any State;

     an estate whose income is subject to United States Federal income taxation
     regardless of its source; or

     a trust if a United States court is able to exercise primary supervision
     over administration of the trust and one or more United States persons have
     authority to control all substantial decisions of the trust.

    As long as Vornado qualifies as a REIT, distributions made by Vornado out of
its current or accumulated earnings and profits, and not designated as capital
gain dividends, will constitute dividends taxable to its taxable U.S.
shareholders as ordinary income. Distributions of this kind will not be eligible
for the dividends received deduction in the case of U.S. shareholders that are
corporations. Distributions made by Vornado that Vornado properly designates as
capital gain dividends will be taxable to U.S. shareholders as gain from the
sale of a capital asset held for more than one year, to the extent that they do
not exceed Vornado's actual net capital gain for the taxable year, without
regard to the period for which a U.S. shareholder has held his shares. Thus,
with certain limitations, capital gains dividends received by an individual U.S.
shareholder may be eligible for 20% or 25% capital gains rates of taxation. U.S.
shareholders that are

                                       77

corporations may, however, be required to treat up to 20% of certain capital
gain dividends as ordinary income.

    To the extent that Vornado makes distributions, not designated as capital
gain dividends, in excess of its current and accumulated earnings and profits,
these distributions will be treated first as a tax-free return of capital to
each U.S. shareholder. Thus, these distributions will reduce the adjusted basis
which the U.S. shareholder has in his shares for tax purposes by the amount of
the distribution, but not below zero. Distributions in excess of a U.S.
shareholder's adjusted basis in his shares will be taxable as capital gains,
provided that the shares have been held as a capital asset. For purposes of
determining the portion of distributions on separate classes of shares that will
be treated as dividends for Federal income tax purposes, current and accumulated
earnings and profits will be allocated to distributions resulting from priority
rights of preferred shares before being allocated to other distributions.

    Dividends authorized by Vornado in October, November, or December of any
year and payable to a shareholder of record on a specified date in any of these
months will be treated as both paid by Vornado and received by the shareholder
on December 31 of that year, provided that Vornado actually pays the dividend on
or before January 31 of the following calendar year. Shareholders may not
include in their own income tax returns any net operating losses or capital
losses of Vornado.

    U.S. shareholders holding shares at the close of Vornado's taxable year will
be required to include, in computing their long-term capital gains for the
taxable year in which the last day of Vornado's taxable year falls, the amount
that Vornado designates in a written notice mailed to its shareholders. Vornado
may not designate amounts in excess of Vornado's undistributed net capital gain
for the taxable year. Each U.S. shareholder required to include the designated
amount in determining the shareholder's long-term capital gains will be deemed
to have paid, in the taxable year of the inclusion, the tax paid by Vornado in
respect of the undistributed net capital gains. U.S. shareholders to whom these
rules apply will be allowed a credit or a refund, as the case may be, for the
tax they are deemed to have paid. U.S. shareholders will increase their basis in
their shares by the difference between the amount of the includible gains and
the tax deemed paid by the shareholder in respect of these gains.

    Distributions made by Vornado and gain arising from a U.S. shareholder's
sale or exchange of shares will not be treated as passive activity income. As a
result, U.S. shareholders generally will not be able to apply any passive losses
against that income or gain.

    When a U.S. shareholder sells or otherwise disposes of shares, the
shareholder will recognize gain or loss for Federal income tax purposes in an
amount equal to the difference between (a) the amount of cash and the fair
market value of any property received on the sale or other disposition, and
(b) the holder's adjusted basis in the shares for tax purposes. This gain or
loss will be capital gain or loss if the U.S. shareholder has held the shares as
a capital asset. The gain or loss will be long-term gain or loss if the U.S.

                                       78

shareholder has held the shares for more than one year. A maximum tax rate of
20% generally applies to long-term capital gain of an individual U.S.
shareholder. In general, any loss recognized by a U.S. shareholder when the
shareholder sells or otherwise disposes of shares of Vornado that the
shareholder has held for six months or less, after applying certain holding
period rules, will be treated as a long-term capital loss, to the extent of
distributions received by the shareholder from Vornado which were required to be
treated as long-term capital gains.

    BACKUP WITHHOLDING. Vornado will report to its U.S. shareholders and the IRS
the amount of dividends paid during each calendar year, and the amount of tax
withheld, if any. Under the backup withholding rules, backup withholding at the
rate of 31% may apply to a shareholder with respect to dividends paid unless the
holder (a) is a corporation or comes within certain other exempt categories and,
when required, demonstrates this fact, or (b) provides a taxpayer identification
number, certifies as to no loss of exemption from backup withholding, and
otherwise complies with applicable requirements of the backup withholding rules.
The IRS may also impose penalties on a U.S. shareholder that does not provide
Vornado with his correct taxpayer identification number. A shareholder may
credit any amount paid as backup withholding against the shareholder's income
tax liability. In addition, Vornado may be required to withhold a portion of
capital gain distributions to any shareholders who fail to certify their
non-foreign status to Vornado.

    TAXATION OF TAX-EXEMPT SHAREHOLDERS. The IRS has ruled that amounts
distributed as dividends by a REIT generally do not constitute unrelated
business taxable income when received by a tax-exempt entity. Based on that
ruling, provided that a tax-exempt shareholder is not one of the types of entity
described in the next paragraph and has not held its shares as 'debt financed
property' within the meaning of the Internal Revenue Code and the shares are not
otherwise used in a trade or business, the dividend income from shares will not
be unrelated business taxable income to a tax-exempt shareholder. Similarly,
income from the sale of shares will not constitute unrelated business taxable
income unless the tax-exempt shareholder has held the shares as 'debt financed
property' within the meaning of the Internal Revenue Code or has used the shares
in a trade or business.

    Income from an investment in Vornado's shares will constitute unrelated
business taxable income for tax-exempt shareholders that are social clubs,
voluntary employee benefit associations, supplemental unemployment benefit
trusts, and qualified group legal services plans exempt from Federal income
taxation under the applicable subsections of Section 501(c) of the Internal
Revenue Code, unless the organization is able to properly deduct amounts set
aside or placed in reserve for certain purposes so as to offset the income
generated by its shares. Prospective investors of the types described in the
preceding sentence should consult their own tax advisors concerning these 'set
aside' and reserve requirements.

                                       79

    Notwithstanding the foregoing, however, a portion of the dividends paid by a
'pension-held REIT' will be treated as unrelated business taxable income to any
trust which

     is described in Section 401(a) of the Internal Revenue Code;

     is tax exempt under Section 501(a) of the Code; and

     holds more than 10% (by value) of the equity interests in the REIT.

Tax-exempt pension, profit-sharing and stock bonus funds that are described in
Section 401(a) of the Internal Revenue Code are referred to below as 'qualified
trusts.' A REIT is a 'pension-held REIT' if

it would not have qualified as a REIT but for the fact that Section 856(h)(3) of
  the Internal Revenue Code provides that stock owned by qualified trusts will
  be treated, for purzposes of the 'not closely held' requirement, as owned by
  the beneficiaries of the trust (rather than by the trust itself); and

either (a) at least one qualified trust holds more than 25% by value of the
  interests in the REIT or (b) one or more qualified trusts, each of which owns
  more than 10% by value of the interests in the REIT, hold in the aggregate
  more than 50% by value of the interests in the REIT.

The percentage of any REIT dividend treated as unrelated business taxable income
is equal to the ratio of (a) the gross income of the REIT from unrelated trades
or businesses, determined as though the REIT were a qualified trust, less direct
expenses related to this gross income, to (b) the total gross income of the
REIT, less direct expenses related to the total gross income. A de minimis
exception applies where this percentage is less than 5% for any year. Vornado
does not expect to be classified as a pension-held REIT.

    The rules described above under the heading 'U.S. shareholders' concerning
the inclusion of Vornado's designated undistributed net capital gains in the
income of its shareholders will apply to tax-exempt entities. Thus, tax-exempt
entities will be allowed a credit or refund of the tax deemed paid by these
entities in respect of the includible gains.

NON-U.S. SHAREHOLDERS

    The rules governing U.S. Federal income taxation of nonresident alien
individuals, foreign corporations, foreign partnerships and other foreign
shareholders, which we call 'non-U.S. shareholders', are complex. The following
discussion is only a limited summary of these rules. Prospective non-U.S.
shareholders should consult with their own tax advisors to determine the impact
of U.S. Federal, state and local income tax laws with regard to an investment in
shares, including any reporting requirements.

    ORDINARY DIVIDENDS. Distributions, other than distributions that are treated
as attributable to gain from sales or exchanges by Vornado of U.S. real property
interests, as discussed below, and other than distributions designated by
Vornado as capital gain dividends, will be treated as ordinary income to the
extent that they are made out of current or accumulated earnings and profits of
Vornado. A withholding tax equal to 30% of the gross amount of the distribution
will ordinarily

                                       80

apply to distributions of this kind to non-U.S. shareholders, unless an
applicable tax treaty reduces that tax. However, if income from the investment
in the shares is treated as effectively connected with the non-U.S.
shareholder's conduct of a U.S. trade or business or is attributable to a
permanent establishment that the non-U.S. shareholder maintains in the U.S. if
that is required by an applicable income tax treaty as a condition for
subjecting the non-U.S. shareholder to U.S. taxation on a net income basis, tax
at graduated rates will generally apply to the non-U.S. shareholder in the same
manner as U.S. shareholders are taxed with respect to dividends, and the 30%
branch profits tax may also apply if the shareholder is a foreign corporation.
Vornado expects to withhold U.S. tax at the rate of 30% on the gross amount of
any dividends, other than dividends treated as attributable to gain from sales
or exchanges of U.S. real property interests and capital gain dividends, paid to
a non-U.S. shareholder, unless (a) a lower treaty rate applies and the required
form evidencing eligibility for that reduced rate is filed with Vornado or the
appropriate withholding agent or (b) the non-U.S. shareholder files an IRS
Form W 8-ECI or a successor form with Vornado or the appropriate withholding
agent claiming that the distributions are effectively connected with the
non-U.S. shareholder's conduct of a U.S. trade or business.

    Distributions to a non-U.S. shareholder that are designated by Vornado at
the time of distribution as capital gain dividends which are not attributable to
or treated as attributable to the disposition by Vornado of a U.S. real property
interest generally will not be subject to U.S. Federal income taxation, except
as described below.

    RETURN OF CAPITAL. Distributions in excess of Vornado's current and
accumulated earnings and profits, which are not treated as attributable to the
gain from Vornado's disposition of a U.S. real property interest, will not be
taxable to a non-U.S. shareholder to the extent that they do not exceed the
adjusted basis of the non-U.S. shareholder's shares. Distributions of this kind
will instead reduce the adjusted basis of the shares. To the extent that
distributions of this kind exceed the adjusted basis of a non-U.S. shareholder's
shares, they will give rise to tax liability if the non-U.S. shareholder
otherwise would have to pay tax on any gain from the sale or disposition of its
shares, as described below. If it cannot be determined at the time a
distribution is made whether the distribution will be in excess of current and
accumulated earnings and profits, withholding will apply to the distribution at
the rate applicable to dividends. However, the non-U.S. shareholder may seek a
refund of these amounts from the IRS if it is subsequently determined that the
distribution was, in fact, in excess of current accumulated earnings and profits
of Vornado.

    CAPITAL GAIN DIVIDENDS. For any year in which Vornado qualifies as a REIT,
distributions that are attributable to gain from sales or exchanges by Vornado
of U.S. real property interests will be taxed to a non-U.S. shareholder under
the provisions of the Foreign Investment in Real Property Tax Act of 1980, as
amended. Under this statute, these distributions are taxed to a non-U.S.
shareholder as if the gain were effectively connected with a U.S. business.
Thus, non-U.S. shareholders will be taxed on the distributions at the normal
capital gain rates applicable to U.S. shareholders, subject to any applicable
alternative

                                       81

minimum tax and special alternative minimum tax in the case of nonresident alien
individuals. Vornado is required by applicable Treasury regulations under this
statute to withhold 35% of any distribution that Vornado could designate as a
capital gain dividend. However, if Vornado designates as a capital gain dividend
a distribution made before the day Vornado actually effects the designation,
then although the distribution may be taxable to a non-U.S. shareholder,
withholding does not apply to the distribution under this statute. Rather,
Vornado must effect the 35% withholding from distributions made on and after the
date of the designation, until the distributions so withheld equal the amount of
the prior distribution designated as a capital gain dividend. The non-U.S.
shareholder may credit the amount withheld against its U.S. tax liability.

    SALES OF SHARES. Gain recognized by a non-U.S. shareholder upon a sale or
exchange of common shares generally will not be taxed under the Foreign
Investment in Real Property Tax Act if Vornado is a 'domestically controlled
REIT', defined generally as a REIT, less than 50% in value of whose stock is and
was held directly or indirectly by foreign persons at all times during a
specified testing period. Vornado believes that it is and will continue to be a
domestically controlled REIT, and, therefore, that taxation under this statute
generally will not apply to the sale of Vornado shares. However, gain to which
this statute does not apply will be taxable to a non-U.S. shareholder if
investment in the shares is treated as effectively connected with the non-U.S.
shareholder's U.S. trade or business or is attributable to a permanent
establishment that the non-U.S. shareholder maintains in the U.S. if that is
required by an applicable income tax treaty as a condition for subjecting the
non-U.S. shareholder to U.S. taxation on a net income basis. In this case, the
same treatment will apply to the non-U.S. shareholder as to U.S. shareholders
with respect to the gain. In addition, gain to which the Foreign Investment in
Real Property Tax Act does not apply will be taxable to a non-U.S. shareholder
if the non-U.S. shareholder is a nonresident alien individual who was present in
the United States for 183 days or more during the taxable year and has a 'tax
home' in the United States, or maintains an office or a fixed place of business
in the United States to which the gain is attributable. In this case, a 30% tax
will apply to the nonresident alien individual's capital gains. A similar rule
will apply to capital gain dividends to which this statute does not apply.

    If Vornado were not a domestically-controlled REIT, tax under the Foreign
Investment in Real Property Tax Act would apply to a non-U.S. shareholder's sale
of shares only if the selling non-U.S. shareholder owned more than 5% of the
class of shares sold at any time during a specified period. This period is
generally the shorter of the period that the non-U.S. shareholder owned the
shares sold or the five-year period ending on the date when the shareholder
disposed of the shares. If tax under this statute applies to the gain on the
sale of shares, the same treatment would apply to the non-U.S. shareholder as to
U.S. shareholders with respect to the gain, subject to any applicable
alternative minimum tax and a special alternative minimum tax in the case of
nonresident alien individuals.

                                       82

    TREATY BENEFITS. Under current Treasury regulations, dividends paid to an
address in a country outside the United States are generally presumed to be paid
to a resident of that country for purposes of determining whether the
withholding discussed above applies and whether a tax treaty rate applies.
Shareholders that are partnerships or entities that are similarly fiscally
transparent for Federal income tax purposes, and persons holding shares through
such entities, may not be able to claim benefits under U.S. tax treaties.
Shareholders of these kinds should consult a tax advisor.

    Under recently issued Treasury regulations that are effective for payments
made after December 31, 2000, however, a non-U.S. shareholder who wishes to
claim the benefit of an applicable treaty rate would be required to satisfy
applicable certification requirements. In addition, under these regulations, in
the case of shares held by a foreign partnership, (x) the certification
requirement would generally apply to the partners in the partnership and
(y) the partnership would be required to provide certain information, including
a United States taxpayer identification number. These regulations provide
look-through rules in the case of tiered partnerships.

OTHER TAX CONSEQUENCES

    State or local taxation may apply to Vornado and its shareholders in various
state or local jurisdictions, including those in which it or they transact
business or reside. The state and local tax treatment of Vornado and its
shareholders may not conform to the Federal income tax consequences discussed
above. Consequently, prospective shareholders should consult their own tax
advisors regarding the effect of state and local tax laws on an investment in
Vornado.

                              PLAN OF DISTRIBUTION

    This prospectus relates to the possible issuance by Vornado of up to
7,032,750 shares, if, and to the extent that, Vornado elects to issue common
shares to holders of up to 7,032,750 units, upon the tender of the units for
redemption.

    Vornado will not receive any cash proceeds from the issuance of the common
shares to holders of units upon receiving a notice of redemption. Vornado will
acquire one unit from a redeeming partner, in exchange for each common share
that Vornado issues. Consequently, with each redemption, Vornado's interest in
the operating partnership will increase.

    All costs, expenses and fees in connection with the registration of the
common shares will be borne by Vornado.

                                    EXPERTS

    The consolidated financial statements and the related consolidated financial
statement schedules incorporated in this prospectus by reference from Vornado's
Annual Report on Form 10-K for the year ended December 31, 1999 have been
audited by Deloitte & Touche LLP, independent auditors, as stated in their
reports,

                                       83

which are incorporated herein by reference, and have been so incorporated in
reliance upon the reports of such firm given upon their authority as experts in
accounting and auditing.

                         VALIDITY OF THE COMMON SHARES

    The validity of the common shares issued under this prospectus will be
passed upon for Vornado by Ballard Spahr Andrews & Ingersoll, LLP, Baltimore,
Maryland, Maryland counsel to Vornado.

                                       84

                                    PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

    The estimated expenses in connection with the issuance and distribution of
the securities being registered, other than underwriting compensation, are as
follows:

                                                         
SEC registration fee......................................  $ 64,055
Printing and engraving expenses...........................  $ 50,000
Legal fees and disbursements..............................  $100,000
Accounting fees and disbursements.........................  $ 50,000
Transfer Agent's and Depositary's fees and
  Disbursements...........................................  $ 25,000
Blue Sky fees and expenses................................  $ 15,000
Miscellaneous (including listing fees)....................  $ 25,000
                                                            --------
    Total.................................................  $329,055
                                                            --------
                                                            --------

- ---------

*  Represents filing fee paid upon the initial filing of the Registration
   Statement.

ITEM 15. INDEMNIFICATION OF TRUSTEES AND OFFICERS.

    The Maryland REIT Law ('MRL'), permits a Maryland real estate investment
trust to include in its declaration of trust a provision limiting the liability
of its trustees and officers to the trust and its shareholders for money damages
except for liability resulting from (i) actual receipt of an improper benefit or
profit in money, property or services or (ii) active and deliberate dishonesty
established by a final judgment as being material to the cause of action.
Vornado's Declaration of Trust includes such a provision eliminating such
liability to the maximum extent permitted by the MRL.

    Vornado's Declaration of Trust authorizes it to indemnify, and to pay or
reimburse reasonable expenses to, as such expenses are incurred by, each trustee
or officer (including any person who, while a trustee of Vornado, is or was
serving at the request of Vornado as a director, officer, partner, trustee,
employee or agent of another foreign or domestic corporation, partnership, joint
venture, trust, other enterprise or employee benefit plan) from all claims and
liabilities to which such person may become subject by reason of his being or
having been a trustee, officer, employee or agent.

    Vornado's Bylaws require it to indemnify (a) any trustee or officer or any
former trustee or officer (including and without limitation, any individual who,
while a trustee or officer and at the request of Vornado, serves or has served
another corporation, partnership, joint venture, trust, employee benefit plan or
any other enterprise as a director, officer, partner or trustee of such
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise) who has been successful, on the merits or otherwise, in the defense
of a proceeding to which he was made a party by reason of such status, against
reasonable

                                      II-1

expenses incurred by him in connection with the proceeding and (b) any present
or former trustee or officer against any claim or liability to which he may
become subject by reason of such status unless it is established that (i) his
act or omission was material to the matter giving rise to the proceeding and was
committed in bad faith or was the result of active and deliberate dishonesty,
(ii) he actually received an improper personal benefit in money, property or
services or (iii) in the case of a criminal proceeding, he had reasonable cause
to believe that his act or omission was unlawful. In addition, Vornado's Bylaws
require it to pay or reimburse, in advance of final disposition of a proceeding,
reasonable expenses incurred by a present or former trustee or officer made a
party to a proceeding by reason of such status upon Vornado's receipt of (i) a
written affirmation by the trustee or officer of his good faith belief that he
has met the applicable standard of conduct necessary for indemnification by
Vornado and (ii) a written undertaking by him or on his behalf to repay the
amount paid or reimbursed by Vornado if it shall ultimately be determined that
the applicable standard of conduct was not met. Vornado's Bylaws also (i) permit
Vornado to provide indemnification and payment or reimbursement of expenses to a
present or former trustee or officer who served a predecessor of Vornado in such
capacity and to any employee or agent of Vornado or a predecessor of Vornado,
(ii) provide that any indemnification or payment or reimbursement of the
expenses permitted by the Bylaws shall be furnished in accordance with the
procedures provided for indemnification or payment or reimbursement of expenses,
as the case may be, under Section 2-418 of the Maryland General Corporation Law
(the 'MGCL') for directors of Maryland corporations and (iii) permit Vornado to
provide such other and further indemnification or payment or reimbursement of
expenses as may be permitted by the MGCL, as in effect from time to time, for
directors of Maryland corporations.

    The MRL permits a Maryland real estate investment trust to indemnify and
advance expenses to its trustees, officers, employees and agents to the same
extent as permitted by the MGCL for directors and officers of Maryland
corporations. The MGCL permits a corporation to indemnify its present and former
directors and officers, among others, against judgments, penalties, fines,
settlements and reasonable expenses actually incurred by them in connection with
any proceeding to which they may be made a party by reason of their service in
those or other capacities unless it is established that (a) the act or omission
of the director or officer was material to the matter giving rise to the
proceeding and (i) was committed in bad faith or (ii) was the result of active
and deliberate dishonesty, (b) the director or officer actually received an
improper personal benefit in money, property or services or (c) in the case of
any criminal proceeding, the director or officer had reasonable cause to believe
that the act or omission was unlawful. However, under the MGCL, a Maryland
corporation may not indemnify for an adverse judgment in a suit by or in the
right of the corporation or for a judgment of liability on the basis that
personal benefit was improperly received, unless in either case a court orders
indemnification and then only for expenses. In addition, the MGCL permits a
corporation to advance reasonable expenses to a director or officer upon the
corporation's receipt of (a)

                                      II-2

a written affirmation by the director or officer of his good faith belief that
he has met the standard of conduct necessary for indemnification by the
corporation and (b) a written undertaking by him or on his behalf to repay the
amount paid or reimbursed by the corporation if it shall ultimately be
determined that the standard of conduct was not met.

    Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to trustees, officers and controlling persons of Vornado
pursuant to the foregoing provisions or otherwise, Vornado has been advised
that, although the validity and scope of the governing statute has not been
tested in court, in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In addition, indemnification may be limited by
state securities laws.

    The Second Amended and Restated Agreement of Limited Partnership, dated as
of October 20, 1997, as amended (the 'Partnership Agreement'), of the Operating
partnership provides, generally, for the indemnification of an 'Indemnitee'
against losses, claims, damages, liabilities, expenses (including, without
limitation, attorneys' fees and other legal fees and expenses), judgments,
fines, settlements and other amounts that relate to the operations of the
Operating partnership unless it is established that (i) the act or omission of
the Indemnitee was material and either was committed in bad faith or pursuant to
active and deliberate dishonesty, (ii) the Indemnitee actually received an
improper personal benefit in money, property or services or (iii) in the case of
any criminal proceeding, the Indemnitee had reasonable cause to believe that the
act or omission was unlawful. For this purpose, the term 'Indemnitee' includes
(i) any person made a party to a proceeding by reason of its status as (A) the
general partner of the Operating partnership, (B) a limited partner of the
Operating partnership or (C) an officer of the Operating partnership or a
trustee, officer or shareholder of Vornado and (ii) such other persons
(including affiliates of Vornado or the Operating partnership) as Vornado may
designate from time to time in its discretion. Any such indemnification will be
made only out of assets of the Operating partnership, and in no event may an
Indemnitee subject the limited partners of the Operating partnership to personal
liability by reason of the indemnification provisions in the Partnership
Agreement.

    Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to officers, trustees or controlling persons of the
registrant pursuant to the foregoing provisions or otherwise, the Operating
partnership has been advised that, in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy and, therefore,
unenforceable. The Operating partnership has purchased liability insurance for
the purpose of providing a source of funds to pay the indemnification described
above.

    Pursuant to the registration rights agreements between Vornado and the
holders of units redeemable for the shares registered hereunder, Vornado agrees
to indemnify each Unit holder named therein and each person, if any, who
controls such holder within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act (and the officers, directors, shareholders,

                                      II-3

partners, employees, agents and representatives of certain of the foregoing
persons) (i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement (or any amendment thereto) pursuant to which the Redemption Shares
(i.e., the common shares of beneficial interest of Vornado that are issuable to
the Unit holders upon the redemption of the units that they hold) were
registered under the Securities Act, or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to make
the statements therein not misleading or arising out of or based upon any untrue
statement or alleged untrue statement of a material fact contained in any
Prospectus (or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; (ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or investigation or proceeding by any governmental
agency or body, commenced or threatened, or of any claim whatsoever based upon
any such untrue statement or omission, or any such alleged untrue statement or
omission, if such settlement is effected with the written consent of Vornado;
and (iii) against any and all expenses whatsoever, as incurred, reasonably
incurred in investigating, preparing or defending against any litigation, or
investigation or proceeding by any governmental agency or body, commenced or
threatened, in each case whether or not a party, or any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue statement
or omission; provided, however, that such indemnity does not apply to any Unit
holder with respect to any loss, liability, claim, damage or expense to the
extent arising out of (A) any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity with written
information furnished to Vornado by such Unit holder expressly for use in the
Registration Statement (or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto), or (B) such Unit holder's failure to deliver
an amended or supplemental Prospectus if such loss, liability, claim, damage or
expense would not have arisen had such delivery occurred.

    Pursuant to the registration rights agreements between Vornado and the
holders of units redeemable for the shares registered hereunder, each of the
Unit holders named therein (and each of their permitted assignees) agrees to
indemnify Vornado, and each of its trustees/directors and officers and each
person, if any, who controls Vornado within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act (i) against any and all loss,
liability, claim, damage and expense whatsoever, as incurred, arising out of or
based upon any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement (or any amendment thereto) pursuant to
which the Redemption Shares were registered under the Securities Act, or the
omission or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or arising
out

                                      II-4

of or based upon any untrue statement or alleged untrue statement of a material
fact contained in any Prospectus (or any amendment or supplement thereto), or
the omission or alleged omission therefrom of a material fact necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading; (ii) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or investigation or proceeding by
any governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such alleged
untrue statement or omission, if such settlement is effected with the written
consent of such Unit holder; and (iii) against any and all expenses whatsoever,
as incurred, reasonably incurred in investigating, preparing or defending
against any litigation, or investigation or proceeding by any governmental
agency or body, commenced or threatened, in each case whether or not a party, or
any claim whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission; provided, however, that such
indemnity shall only apply with respect to any loss, liability, claim, damage or
expense to the extent arising out of (A) any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with written information furnished to Vornado by such Unit holder expressly for
use in the Registration Statement (or any amendment thereto) or the Prospectus
(or any amendment or supplement thereto), or (with respect to certain of such
indemnified Unit holders) (B) such Unit holder's failure to deliver an amended
or supplemental Prospectus if such loss, liability, claim, damage or expense
would not have arisen had such delivery occurred. A Unit holder and any
permitted assignee shall not be required to indemnify Vornado, its
officers/trustees, directors or control persons with respect to any amount in
excess of the amount of the total proceeds to such Unit holder or permitted
assignee, as the case may be, from sales of the Redemption Shares of such Unit
holder under the Registration Statement, and no Unit holder shall be liable
under the indemnification provision for any statements or omissions of any other
Unit holder.

    Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to officers/trustees, directors or controlling persons
of the registrant pursuant to the foregoing provisions or otherwise, Vornado has
been advised that, in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy and, therefore, unenforceable.
Vornado has purchased liability insurance for the purpose of providing a source
of funds to pay the indemnification described above.

                                      II-5

ITEM 16. EXHIBITS.

          
    3.1   -- Amended and Restated Declaration of Trust of Vornado Realty Trust, as
             amended on April 3, 1997 (incorporated by reference to Exhibit 3.1 of
             Vornado's Registration Statement on Form S-8 (File No. 333-29011),
             filed on June 12, 1997)
    3.2   -- Articles of Amendment of Declaration of Trust of Vornado Realty
             Trust, as filed with the State Department of Assessments and Taxation
             of Maryland on October 14, 1997*
    3.3   -- Articles of Amendment of Declaration of Trust of Vornado Realty
             Trust, as filed with the State Department of Assessments and Taxation
             of Maryland on April 22, 1998 (incorporated by reference to Exhibit
             3.1 of Vornado's Current Report on Form 8-K dated as of April 22, 1998
             (File No. 1-11954), filed on April 28, 1998)
    3.4   -- Articles of Amendment of Declaration of Trust of Vornado Realty
             Trust, as filed with the State Department of Assessments and Taxation
             of Maryland on November 24, 1999*
    3.5   -- Articles of Amendment of Declaration of Trust of Vornado Realty
             Trust, as filed with the State Department of Assessments and Taxation
             of Maryland on April 20, 2000*
    3.6   -- Articles Supplementary to Declaration of Trust of Vornado Realty
             Trust with respect to the Vornado's Series A Preferred Shares of
             Beneficial Interest (incorporated by reference to Exhibit 4.1 of
             Vornado's Current Report on Form 8-K dated as of April 3, 1997 (File
             No. 1-11954), filed on April 8, 1997)
    3.7   -- Articles Supplementary to Declaration of Trust of Vornado Realty
             Trust with respect to Vornado's Series D-1 8.5% Cumulative Redeemable
             Preferred Shares of Beneficial Interest, dated as of November 12,
             1998, as filed with the State Department of Assessments and Taxation
             of Maryland on November 25, 1998 (incorporated by reference to Exhibit
             3.1 of Vornado's Current Report on Form 8-K dated as of November 12,
             1998 (File No. 1-11954), filed on November 30, 1998)
    3.8   -- Articles Supplementary to Declaration of Trust of Vornado Realty
             Trust with respect to Vornado's Series D-1 8.5% Cumulative Redeemable
             Preferred Shares of Beneficial Interest, dated as of December 22,
             1998, as filed with the State Department of Assessments and Taxation
             of Maryland on January 12, 1999 (incorporated by reference to Exhibit
             3.2 of Vornado's Current Report on Form 8-K/A, dated as of November
             12, 1998 (File No. 1-11954), filed on February 9, 1999)
    3.9   -- Articles Supplementary to Declaration of Trust of Vornado Realty with
             respect to Vornado's 8.5% Series B Cumulative Redeemable Shares of
             Beneficial Interest (incorporated by reference to Exhibit 3.3 of
             Vornado's Current Report on Form 8-K, dated as of March 3, 1999 (File
             No. 1-11954), filed on March 17, 1999)

                                      II-6

EXHIBIT NO.                            EXHIBIT
- -----------                            -------
          
    3.10   -- Articles Supplementary to Declaration of Trust of Vornado
              Realty Trust with respect to Vornado's Series C Preferred
              Shares (incorporated by reference to Exhibit 3.7 of
              Vornado's Registration Statement on Form 8-A (File No.
              1-11954), filed on May 19, 1999)
    3.11   -- Articles Supplementary to Declaration of Trust of Vornado
              Realty Trust with respect to Vornado's Series D-2
              Preferred Shares, dated as of May 27, 1999, as filed with
              the State Department of Assessments and Taxation of
              Maryland on May 27, 1999 (incorporated by reference to
              Exhibit 3.1 of Vornado's Current Report on Form 8-K, dated
              as of May 27, 1999 (File No. 1-11954), filed on July 7,
              1999)
    3.12   -- Articles Supplementary to Declaration of Trust of Vornado
              Realty Trust with respect to Vornado's Series D-3
              Preferred Shares, dated as of September 3, 1999
              (incorporated by reference to Exhibit 3.1 of Vornado's
              Current Report on Form 8-K, dated as of September 3 (File
              No. 1-11954), filed on October 25, 1999)
    3.13   -- Articles Supplementary to Declaration of Trust of Vornado
              Realty Trust with respect to Vornado's Series D-4
              Preferred Shares, dated as of September 3, 1999
              (incorporated by reference to Exhibit 3.2 of Vornado's
              Current Report on Form 8-K, dated as of September 3 (File
              No. 1-11954), filed on October 25, 1999)
    3.14   -- Articles Supplementary to Declaration of Trust of Vornado
              Realty Trust with respect to Vornado's Series D-5
              Preferred Shares (incorporated by reference to Exhibit 3.1
              of Vornado's Current Report on Form 8-K, dated as of
              November 24, 1999 (File No. 1-11954), filed on
              December 23, 1999)
    3.15   -- Amended and Restated By-laws of Vornado, as amended on
              March 2, 2000 (incorporated by reference to Exhibit 3.12
              of Vornado's Annual Report on Form 10-K for the period
              ended December 3 , 1999 (File No. 1-11954), filed on March
              9, 2000)
    3.16   -- Second Amended and Restated Agreement of Limited
              Partnership of the Operating partnership, dated as of
              October 20, 1997 (the 'Partnership Agreement')
              (incorporated by reference to Exhibit 3.4 of Vornado's
              Annual Report on Form 10-K for the year ended December 31,
              1997 (File No. 1-11954), filed on March 31, 1998)
    3.17   -- Amendment, dated as of December 16, 1997, to the
              Partnership Agreement (incorporated by reference to
              Exhibit 3.5 of Vornado's Annual Report on Form 10-K for
              the year ended December 31, 1997 (File No. 1-11954), filed
              on March 31, 1998)
    3.18   -- Second Amendment, dated as of April 1, 1998, to the
              Partnership Agreement (incorporated by reference to
              Exhibit 3.5 of Vornado's Registration Statement on Form
              S-3 (File No. 333-50095), filed on April 14, 1998)

                                      II-7

EXHIBIT NO.                            EXHIBIT
- -----------                            -------
          
    3.19   -- Third Amendment, dated as of November 12, 1998, to the
              Partnership Agreement (incorporated by reference to
              Exhibit 3.2 of Vornado's Current Report on Form 8-K, dated
              as of November 12, 1998 (File No. 1-11954), filed on
              November 30, 1998)
    3.20   -- Fourth Amendment to the Partnership Agreement, dated as
              of November 30, 1998 (incorporated by reference to Exhibit
              3.1 of Vornado's Current Report on Form 8-K, dated as of
              December 1, 1998 (File No. 1-11954), filed on February 9,
              1999)
    3.21   -- Exhibit A to the Partnership Agreement, dated as of
              December 22, 1998 (incorporated by reference to Exhibit
              3.4 of Vornado's Current Report on Form 8-K/A, dated as of
              November 12, 1998 (File No. 1-11954), filed on February 9,
              1999)
    3.22   -- Fifth Amendment to the Partnership Agreement, dated as of
              March 3, 1999 (incorporated by reference to Exhibit 3.1 of
              Vornado's Current Report on Form 8-K, dated as of March 3,
              1999 (File No. 1-11954), filed on March 17, 1999)
    3.23   -- Exhibit A to the Partnership Agreement, dated as of March
              11, 1999 (incorporated by reference to Exhibit 3.2 of
              Vornado's Current Report on Form 8-K, dated as of March 3,
              1999 (File No. 1-11954), filed on March 17, 1999)
    3.24   -- Sixth Amendment to the Partnership Agreement, dated as of
              March 17, 1999 (incorporated by reference to Exhibit 3.2
              of Vornado's Current Report on Form 8-K, dated as of May
              27, 1999 (File No. 1-11954), filed on July 7, 1999)
    3.25   -- Seventh Amendment to the Partnership Agreement, dated as
              of May 20, 1999 (incorporated by reference to Exhibit 3.3
              of Vornado's Current Report on Form 8-K, dated as of May
              27, 1999 (File No. 1-11954), filed on July 7, 1999)
    3.26   -- Eighth Amendment to the Partnership Agreement, dated as
              of May 27, 1999 (incorporated by reference to Exhibit 3.4
              of Vornado's Current Report on Form 8-K, dated as of May
              27, 1999 (File No. 1-11954), filed on July 7, 1999)
    3.27   -- Ninth Amendment to the Partnership Agreement, dated as of
              September 3, 1999 (incorporated by reference to Exhibit
              3.4 of Vornado's Current Report on Form 8-K, dated as of
              September 3 (File No. 1-11954), filed on October 25, 1999)
    3.28   -- Tenth Amendment to the Partnership Agreement, dated as of
              September 3, 1999 (incorporated by reference to Exhibit
              3.5 of Vornado's Current Report on Form 8-K, dated as of
              September 3 (File No. 1-11954), filed on October 25, 1999)

                                      II-8

EXHIBIT NO.                            EXHIBIT
- -----------                            -------
          
    3.29   -- Eleventh Amendment to the Partnership Agreement, dated as
              of November 24, 1999 (incorporated by reference to Exhibit
              3.2 of Vornado's Current Report on Form 8-K, dated as of
              November 24 (File No. 1-11954), filed on December 23,
              1999)
    4.1    -- Instruments defining the rights of security holders (see
              Exhibits 3.1, 3.2, 3.3, 3.4, 3.5, 3.6, 3.7, 3.8, 3.9,
              3.10, 3.11, 3.12, 3.13, 3.14 and 3.15 of this registration
              statement)
    4.2    -- Indenture dated as of November 24, 1993 between Vornado
              Finance Corp. and Bankers Trust Company as Trustee
              (incorporated by reference to Vornado's Current Report on
              Form 8-K, dated as of November 24, 1993 (File No.
              1-11954), filed on December 1, 1993)
    4.3    -- Specimen certificate evidencing Vornado's Common Shares
              of beneficial interest, par value $.04 per share
              (incorporated by reference to Exhibit 4.1 of Amendment No.
              1 to Vornado's Registration Statement on Form S-3 (File
              No. 33-62395), filed on October 26, 1995)
    4.4    -- Specimen certificate evidencing Vornado's $3.25 Series A
              Preferred Shares of Beneficial Interest, liquidation
              preference $50.00 per share (incorporated by reference to
              Exhibit 4.2 of Vornado's Current Report on Form 8-K, dated
              as of April 3, 1997 (File No. 1-11954), filed on April 8,
              1997)
    4.5    -- Specimen certificate evidencing Vornado's 8.5% Series B
              Cumulative Redeemable Preferred Shares of Beneficial
              Interest (incorporated by reference to Exhibit 4.2 of
              Vornado's Registration Statement on Form 8-A (File No.
              1-11954), filed on March 15, 1999)
    4.6    -- Specimen certificate evidencing Vornado's 8.5% Series C
              Cumulative Redeemable Preferred Shares of Beneficial
              Interest, liquidation preference $25.00 per share, no par
              value (incorporated by reference to Exhibit 4.2 of
              Vornado's Registration Statement on Form 8-A (File No.
              1-11954), filed on May 19, 1999)
    5      -- Opinion of Ballard Spahr Andrews & Ingersoll, LLP*
    8.1    -- Tax opinion of Sullivan & Cromwell*
    8.2    -- Tax opinion of Shearman & Sterling*
   23.1    -- Consent of Ballard Spahr Andrews & Ingersoll, LLP
              (included in its opinion filed as Exhibit 5)*
   23.2    -- Consent of Sullivan & Cromwell (included in its opinion
              filed as Exhibit 8.1)*
   23.3    -- Consent of Shearman & Sterling (included in its opinion
              filed as Exhibit 8.2)*
   23.4    -- Consent of Deloitte & Touche LLP*
   24      -- Power of Attorney*
- -------------------------------------------------------------------------
 * Filed herewith.

                                      II-9

ITEM 17. UNDERTAKINGS.

    (a) The undersigned registrant hereby undertakes:

       (1) To file, during any period in which offers or sales are being made, a
    post-effective amendment to this registration statement;

           (i) To include any prospectus required by Section 10(a)(3) of the
       Securities Act of 1933;

           (ii) To reflect in the prospectus any facts or events arising after
       the effective date of the registration statement (or the most recent
       post-effective amendment thereof) which, individually or in the
       aggregate, represent a fundamental change in the information set forth in
       the registration statement. Notwithstanding the foregoing, any increase
       or decrease in volume of securities offered (if the total dollar value of
       securities offered would not exceed that which was registered) and any
       deviation from the low or high end of the estimated maximum offering
       range may be reflected in the form of prospectus filed with the
       Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
       volume and price represent no more than a 20 percent change in the
       maximum aggregate offering price set forth in the 'Calculation of
       Registration Fee' table in the effective registration statement.

           (iii) To include any material information with respect to the plan of
       distribution not previously disclosed in the registration statement or
       any material change to such information in the registration statement;
       provided, however, that paragraphs (a) (1) (i) and (a) (1) (ii) do not
       apply if the information required to be included in a post-effective
       amendment by those paragraphs is contained in periodic reports filed with
       or furnished to the Commission by the registrant pursuant to Section 13
       or Section 15(d) of the Securities Exchange Act of 1934 that are
       incorporated by reference in the registration statement.

       (2) That, for the purpose of determining any liability under the
    Securities Act of 1933, each such posteffective amendment shall be deemed to
    be a new registration statement relating to the securities offered therein,
    and the offering of such securities at that time shall be deemed to be the
    initial bona fide offering thereof.

       (3) To remove from registration by means of a post-effective amendment
    any of the securities being registered which remain unsold at the
    termination of the offering.

    (b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the

                                     II-10

securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.

    (c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question of whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.

                                     II-11

                                   SIGNATURES

    Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.

                                          VORNADO REALTY TRUST,
                                          a Maryland real estate investment
                                          trust

                                          By: /s/       STEVEN ROTH
                                               .................................
                                                   CHAIRMAN OF THE BOARD OF
                                                           TRUSTEES
                                                (PRINCIPAL EXECUTIVE OFFICER)

                SIGNATURE                             TITLE                    DATE
                ---------                             -----                    ----
                                                                  
            /s/ STEVEN ROTH                 Chairman of the Board of      April 28, 2000
 .........................................    Trustees (Principal
               STEVEN ROTH                    Executive Officer)

       /s/ MICHAEL D. FASCITELLI            President and Trustee         April 28, 2000
 .........................................
          MICHAEL D. FASCITELLI

          /s/ IRWIN GOLDBERG                Vice President -- Chief       April 28, 2000
 .........................................    Financial Officer
              IRWIN GOLDBERG                  (Principal Financial and
                                              Accounting Officer)

         /s/ DAVID MANDELBAUM               Trustee                       April 28, 2000
 .........................................
             DAVID MANDELBAUM

           /s/ STANLEY SIMON                Trustee                       April 28, 2000
 .........................................
              STANLEY SIMON

          /s/ RONALD TARGAN                 Trustee                       April 28, 2000
 .........................................
              RONALD TARGAN

           /s/ RICHARD WEST                 Trustee                       April 28, 2000
 .........................................
               RICHARD WEST

         /s/ RUSSELL WIGHT, JR.             Trustee                       April 28, 2000
 .........................................
            RUSSELL WIGHT, JR.

 By:
 .........................................
             ATTORNEY-IN-FACT

                                     II-12

                                     EXHIBIT INDEX

EXHIBIT NO.                             EXHIBIT
- -----------                             -------
           
    3.1      -- Amended and Restated Declaration of Trust of Vornado
                Realty Trust, as amended on April 3, 1997 (incorporated by
                reference to Exhibit 3.1 of Vornado's Registration
                Statement on Form S-8 (File No. 333-29011), filed on June
                12, 1997)
    3.2      -- Articles of Amendment of Declaration of Trust of Vornado
                Realty Trust, as filed with the State Department of
                Assessments and Taxation of Maryland on October 14, 1997*
    3.3      -- Articles of Amendment of Declaration of Trust of Vornado
                Realty Trust, as filed with the State Department of
                Assessments and Taxation of Maryland on April 22, 1998
                (incorporated by reference to Exhibit 3.1 of Vornado's
                Current Report on Form 8-K dated as of April 22, 1998
                (File No. 1-11954), filed on April 28, 1998)
    3.4      -- Articles of Amendment of Declaration of Trust of Vornado
                Realty Trust, as filed with the State Department of
                Assessments and Taxation of Maryland on November 24, 1999*
    3.5      -- Articles of Amendment of Declaration of Trust of Vornado
                Realty Trust, as filed with the State Department of
                Assessments and Taxation of Maryland on April 20, 2000*
    3.6      -- Articles Supplementary to Declaration of Trust of Vornado
                Realty Trust with respect to the Vornado's Series A
                Preferred Shares of Beneficial Interest (incorporated by
                reference to Exhibit 4.1 of Vornado's Current Report on
                Form 8-K dated as of April 3, 1997 (File No. 1-11954),
                filed on April 8, 1997)
    3.7      -- Articles Supplementary to Declaration of Trust of Vornado
                Realty Trust with respect to Vornado's Series D-1 8.5%
                Cumulative Redeemable Preferred Shares of Beneficial
                Interest, dated as of November 12, 1998, as filed with the
                State Department of Assessments and Taxation of Maryland
                on November 25, 1998 (incorporated by reference to Exhibit
                3.1 of Vornado's Current Report on Form 8-K dated as of
                November 12, 1998 (File No. 1-11954), filed on November
                30, 1998)
    3.8      -- Articles Supplementary to Declaration of Trust of Vornado
                Realty Trust with respect to Vornado's Series D-1 8.5%
                Cumulative Redeemable Preferred Shares of Beneficial
                Interest, dated as of December 22, 1998, as filed with the
                State Department of Assessments and Taxation of Maryland
                on January 12, 1999 (incorporated by reference to Exhibit
                3.2 of Vornado's Current Report on Form 8-K/A, dated as of
                November 12, 1998 (File No. 1-11954), filed on February 9,
                1999)
    3.9      -- Articles Supplementary to Declaration of Trust of Vornado
                Realty with respect to Vornado's 8.5% Series B Cumulative
                Redeemable Shares of Beneficial Interest (incorporated by
                reference to Exhibit 3.3 of Vornado's Current Report on
                Form 8-K, dated as of March 3, 1999 (File No. 1-11954),
                filed on March 17, 1999)

EXHIBIT NO.                             EXHIBIT
- -----------                             -------
           
    3.10     -- Articles Supplementary to Declaration of Trust of Vornado
                Realty Trust with respect to Vornado's Series C Preferred
                Shares (incorporated by reference to Exhibit 3.7 of
                Vornado's Registration Statement on Form 8-A (File No.
                1-11954), filed on May 19, 1999)
    3.11     -- Articles Supplementary to Declaration of Trust of Vornado
                Realty Trust with respect to Vornado's Series D-2
                Preferred Shares, dated as of May 27, 1999, as filed with
                the State Department of Assessments and Taxation of
                Maryland on May 27, 1999 (incorporated by reference to
                Exhibit 3.1 of Vornado's Current Report on Form 8-K, dated
                as of May 27, 1999 (File No. 1-11954), filed on July 7,
                1999)
    3.12     -- Articles Supplementary to Declaration of Trust of Vornado
                Realty Trust with respect to Vornado's Series D-3
                Preferred Shares, dated as of September 3, 1999
                (incorporated by reference to Exhibit 3.1 of Vornado's
                Current Report on Form 8-K, dated as of September 3 (File
                No. 1-11954), filed on October 25, 1999)
    3.13     -- Articles Supplementary to Declaration of Trust of Vornado
                Realty Trust with respect to Vornado's Series D-4
                Preferred Shares, dated as of September 3, 1999
                (incorporated by reference to Exhibit 3.2 of Vornado's
                Current Report on Form 8-K, dated as of September 3 (File
                No. 1-11954), filed on October 25, 1999)
    3.14     -- Articles Supplementary to Declaration of Trust of Vornado
                Realty Trust with respect to Vornado's Series D-5
                Preferred Shares (incorporated by reference to Exhibit 3.1
                of Vornado's Current Report on Form 8-K, dated as of
                November 24, 1999 (File No. 1-11954), filed on December
                23, 1999)
    3.15     -- Amended and Restated By-laws of Vornado, as amended on
                March 2, 2000 (incorporated by reference to Exhibit 3.12
                of Vornado's Annual Report on Form 10-K for the period
                ended December 31, 1999 (File No. 1-11954), filed on March
                9, 2000)
    3.16     -- Second Amended and Restated Agreement of Limited
                Partnership of the Operating partnership, dated as of
                October 20, 1997 (the 'Partnership Agreement')
                (incorporated by reference to Exhibit 3.4 of Vornado's
                Annual Report on Form 10-K for the year ended December 31,
                1997 (File No. 1-11954), filed on March 31, 1998)
    3.17     -- Amendment, dated as of December 16, 1997, to the
                Partnership Agreement (incorporated by reference to
                Exhibit 3.5 of Vornado's Annual Report on Form 10-K for
                the year ended December 31, 1997 (File No. 1-11954), filed
                on March 31, 1998)
    3.18     -- Second Amendment, dated as of April 1, 1998, to the
                Partnership Agreement (incorporated by reference to
                Exhibit 3.5 of Vornado's Registration Statement on Form
                S-3 (File No. 333-50095), filed on April 14, 1998)

EXHIBIT NO.                             EXHIBIT
- -----------                             -------
           
    3.19     -- Third Amendment, dated as of November 12, 1998, to the
                Partnership Agreement (incorporated by reference to
                Exhibit 3.2 of Vornado's Current Report on Form 8-K, dated
                as of November 12, 1998 (File No. 1-11954), filed on
                November 30, 1998)
    3.20     -- Fourth Amendment to the Partnership Agreement, dated as
                of November 30, 1998 (incorporated by reference to Exhibit
                3.1 of Vornado's Current Report on Form 8-K, dated as of
                December 1, 1998 (File No. 1-11954), filed on February 9,
                1999)
    3.21     -- Exhibit A to the Partnership Agreement, dated as of
                December 22, 1998 (incorporated by reference to Exhibit
                3.4 of Vornado's Current Report on Form 8-K/A, dated as of
                November 12, 1998 (File No. 1-11954), filed on February 9,
                1999)
    3.22     -- Fifth Amendment to the Partnership Agreement, dated as of
                March 3, 1999 (incorporated by reference to Exhibit 3.1 of
                Vornado's Current Report on Form 8-K, dated as of March 3,
                1999 (File No. 1-11954), filed on March 17, 1999)
    3.23     -- Exhibit A to the Partnership Agreement, dated as of March
                11, 1999 (incorporated by reference to Exhibit 3.2 of
                Vornado's Current Report on Form 8-K, dated as of March 3,
                1999 (File No. 1-11954), filed on March 17, 1999)
    3.24     -- Sixth Amendment to the Partnership Agreement, dated as of
                March 17, 1999 (incorporated by reference to Exhibit 3.2
                of Vornado's Current Report on Form 8-K, dated as of May
                27, 1999 (File No. 1-11954), filed on July 7, 1999)
    3.25     -- Seventh Amendment to the Partnership Agreement, dated as
                of May 20, 1999 (incorporated by reference to Exhibit 3.3
                of Vornado's Current Report on Form 8-K, dated as of May
                27, 1999 (File No. 1-11954), filed on July 7, 1999)
    3.26     -- Eighth Amendment to the Partnership Agreement, dated as
                of May 27, 1999 (incorporated by reference to Exhibit 3.4
                of Vornado's Current Report on Form 8-K, dated as of May
                27, 1999 (File No. 1-11954), filed on July 7, 1999)
    3.27     -- Ninth Amendment to the Partnership Agreement, dated as of
                September 3, 1999 (incorporated by reference to Exhibit
                3.4 of Vornado's Current Report on Form 8-K, dated as of
                September 3 (File No. 1-11954), filed on October 25, 1999)
    3.28     -- Tenth Amendment to the Partnership Agreement, dated as of
                September 3, 1999 (incorporated by reference to Exhibit
                3.5 of Vornado's Current Report on Form 8-K, dated as of
                September 3 (File No. 1-11954), filed on October 25, 1999)
    3.29     -- Eleventh Amendment to the Partnership Agreement, dated as
                of November 24, 1999 (incorporated by reference to Exhibit
                3.2 of Vornado's Current Report on Form 8-K, dated as of
                November 24 (File No. 1-11954), filed on December 23,
                1999)

EXHIBIT NO.                             EXHIBIT
- -----------                             -------
           
    4.1      -- Instruments defining the rights of security holders (see
                Exhibits 3.1, 3.2, 3.3, 3.4, 3.5, 3.6, 3.7, 3.8, 3.9,
                3.10, 3.11, 3.12, 3.13, 3.14 and 3.15 of this registration
                statement)
    4.2      -- Indenture dated as of November 24, 1993 between Vornado
                Finance Corp. and Bankers Trust Company as Trustee
                (incorporated by reference to Vornado's Current Report on
                Form 8-K, dated as of November 24, 1993 (File No.
                1-11954), filed on December 1, 1993)
    4.3      -- Specimen certificate evidencing Vornado's Common Shares
                of beneficial interest, par value $.04 per share
                (incorporated by reference to Exhibit 4.1 of Amendment No.
                1 to Vornado's Registration Statement on Form S-3 (File
                No. 33-62395), filed on October 26, 1995)
    4.4      -- Specimen certificate evidencing Vornado's $3.25 Series A
                Preferred Shares of Beneficial Interest, liquidation
                preference $50.00 per share (incorporated by reference to
                Exhibit 4.2 of Vornado's Current Report on Form 8-K, dated
                as of April 3, 1997 (File No. 1-11954), filed on April 8,
                1997)
    4.5      -- Specimen certificate evidencing Vornado's 8.5% Series B
                Cumulative Redeemable Preferred Shares of Beneficial
                Interest (incorporated by reference to Exhibit 4.2 of
                Vornado's Registration Statement on Form 8-A (File No.
                1-11954), filed on March 15, 1999)
    4.6      -- Specimen certificate evidencing Vornado's 8.5% Series C
                Cumulative Redeemable Preferred Shares of Beneficial
                Interest, liquidation preference $25.00 per share, no par
                value (incorporated by reference to Exhibit 4.2 of
                Vornado's Registration Statement on Form 8-A (File No.
                1-11954), filed on May 19, 1999)
    5        -- Opinion of Ballard Spahr Andrews & Ingersoll, LLP*
    8.1      -- Tax opinion of Sullivan & Cromwell*
    8.2      -- Tax opinion of Shearman & Sterling*
   23.1      -- Consent of Ballard Spahr Andrews & Ingersoll, LLP
                (included in its opinion filed as Exhibit 5)*
   23.2      -- Consent of Sullivan & Cromwell (included in its opinion
                filed as Exhibit 8.1)*
   23.3      -- Consent of Shearman & Sterling (included in its opinion
                filed as Exhibit 8.2)*
   23.4      -- Consent of Deloitte & Touche LLP*
   24        -- Power of Attorney*

- ---------

*  Filed herewith.

                            STATEMENT OF DIFFERENCES
                            ------------------------

The section symbol shall be expressed as.................................. 'SS'

EXHIBIT 3.2

                              VORNADO REALTY TRUST

                  ARTICLES OF AMENDMENT OF DECLARATION OF TRUST

THIS IS TO CERTIFY THAT:

                  FIRST: The Amended and Restated Declaration of Trust, as
amended (the "Declaration of Trust"), of Vornado Realty Trust, a Maryland real
estate investment trust (the "Trust"), is hereby amended by deleting Article VI,
Section 6.1 of the Declaration of Trust in its entirety and replacing it with
the following:

                  "Section 6.1 Authorized Shares. The total number of shares of
                  beneficial interest which the Trust is authorized to issue is
                  240,000,000 shares, of which 20,000,000 shall be preferred
                  shares of beneficial interest, no par value per share
                  ("Preferred Stock") (including 5,750,000 Series A Convertible
                  Preferred Shares of Beneficial Interest,) 100,000,000 shares
                  shall be common shares of beneficial interest, $.04 par value
                  per share ("Common Stock"), and 120,000,000 shares shall be
                  excess shares of beneficial interest, $.04 par value per share
                  ("Excess Stock").

                  SECOND: The foregoing amendment has been approved by the Board
of Trustees of the Trust as required by Section 8-203(a)(7) of the Corporations
and Associations Article of the Annoted Code of Maryland and Article IX, Section
9.1(b) of the Declaration of Trust.

                  THIRD: The total number of shares of beneficial interest which
the Trust had authority to issue immediately prior to this amendment was
180,000,000, consisting of 70,000,000 common shares of beneficial interest, $.04
par value per share, 20,000,000 preferred shares of beneficial interest, no par
value per share, and 90,000,000 excess shares of beneficial interest, $.04 par
value per share. The aggregate par value of all authorized shares of beneficial
interest having par value was $6,400,000.

                  FOURTH: The number of shares of beneficial interest which the
Trust has authority to issue pursuant to the foregoing amendment is 240,000,000,
consisting of 100,000,000 common shares of beneficial interest, $.04 par value
per share, 20,000,000 preferred shares of beneficial interest, no par value per
share, and 120,000,000 excess

shares of beneficial interest, $.04 par value per share. The aggregate par value
of all authorized shares of beneficial interest having par value is $8,800,000.

                  FIFTH: The undersigned Chairman of the Board acknowledges this
amendment to be the trust act of the Trust and, as to all matters or facts
required to be verified under oath, the undersigned Chairman of the Board
acknowledges that, to the best of his knowledge, information and belief, these
matters and facts are true in all material respects and that his Statement is
made under the penalties for perjury.

                  IN WITNESS WHEREOF, the Trust has caused this amendment to be
signed in its name and on its behalf by its Chairman of the Board and attested
to by its Assistant Secretary on this _____ day of October, 1997.

ATTEST:

                                          VORNADO REALTY TRUST

/s/ Susan D. Schmider                    /s/ Steven Roth            [SEAL]
- ------------------------                 ----------------
Susan D. Schmider                        Steven Roth
Secretary                                Chairman of the Board

                                       -2-

EXHIBIT 3.4

                              VORNADO REALTY TRUST

                  ARTICLES OF AMENDMENT OF DECLARATION OF TRUST

THIS IS TO CERTIFY THAT:

                  FIRST: The Amended and Restated Declaration of Trust, as
amended (the "Declaration of Trust"), of Vornado Realty Trust, a Maryland real
estate investment trust (the "Trust"), is hereby amended by deleting Article VI,
Section 6.1 of the Declaration of Trust in its entirety and replacing it with
the following:

                  "SECTION 6.1 Authorized Shares. The total number of shares of
                  beneficial interest which the Trust is authorized to issue is
                  340,000,000 shares, of which 45,000,000 shall be preferred
                  shares of beneficial interest, no par value per share
                  ("Preferred Stock") (including 5,789,239 $3.25 Series A
                  Convertible Preferred Shares of Beneficial Interest,
                  liquidation preference $50.00 per share; 3,400,000 8.5% Series
                  B Cumulative Redeemable Preferred Shares of Beneficial
                  Interest, liquidation preference $25.00 per share; 4,600,000
                  8.5% Series C Cumulative Redeemable Preferred Shares of
                  Beneficial Interest, liquidation preference $25.00 per share;
                  3,500,000 Series D-1 8.5% Cumulative Redeemable Preferred
                  Shares of Beneficial Interest, liquidation preference $25.00
                  per share; 549,336 8.375% Series D-2 Cumulative Redeemable
                  Preferred Shares of Beneficial Interest, liquidation
                  preference $50.00 per share; 8,000,000 Series D-3 8.25%
                  Cumulative Redeemable Preferred Shares of Beneficial Interest,
                  liquidation preference $25.00 per share; and 5,000,000 Series
                  D-4 8.25% Cumulative Redeemable Preferred Shares of Beneficial
                  Interest, liquidation preference $25.00 per share),
                  125,000,000 shares shall be common shares of beneficial
                  interest, $.04 par value per share ("Common Stock"), and
                  170,000,000 shares shall be excess shares of beneficial
                  interest, $.04 par value per share ("Excess Stock")."

                  SECOND: The foregoing amendment has been approved by the Board
of Trustees of the Trust as required by Section 8-203(a)(7) of the Corporations
and Associations Article of the Annotated Code of Maryland and Article IX,
Section 9.1(b) of the Declaration of Trust.

                  THIRD: The total number of shares of beneficial interest which
the Trust had authority to issue immediately prior to this amendment was
290,000,000, consisting of 125,000,000 common shares of beneficial interest,
$.04 par value per share, 20,000,000 preferred shares of beneficial interest, no
par value per share, and

145,000,000 excess shares of beneficial interest, $.04 par value per share. The
aggregate par value of all authorized shares of beneficial interest having par
value was $10,800,000.

                  FOURTH: The number of shares of beneficial interest which the
Trust has authority to issue pursuant to the foregoing amendment is 340,000,000,
consisting of 125,000,000 common shares of beneficial interest, $.04 par value
per share, 45,000,000 preferred shares of beneficial interest, no par value per
share, and 170,000,000 excess shares of beneficial interest, $.04 par value per
share. The aggregate par value of all authorized shares of beneficial interest
having par value is $11,800,000.

                  FIFTH: The undersigned Chairman of the Board acknowledges this
amendment to be the trust act of the Trust and, as to all matters or facts
required to be verified under oath, the undersigned Chairman of the Board
acknowledges that, to the best of his knowledge, information and belief, these
matters and facts are true in all material respects and that this Statement is
made under the penalties for perjury.

                                       -2-

                  IN WITNESS WHEREOF, the Trust has caused this amendment to be
signed in its name and on its behalf by its Chairman of the Board and attested
to by its Assistant Secretary on this 23rd day of November, 1999.

ATTEST:                                   VORNADO REALTY TRUST

/s/ Larry Portal                          /s/ Steven Roth                [SEAL]
- ------------------                        --------------------
Name: Larry Portal                        Name: Steven Roth
Title: Assistant Secretary                Title: Chairman of the Board

                                       -3-

EXHIBIT 3.5

                              VORNADO REALTY TRUST

                  ARTICLES OF AMENDMENT OF DECLARATION OF TRUST

THIS IS TO CERTIFY THAT:

                  FIRST: The Amended and Restated Declaration of Trust, as
amended (the "Declaration of Trust"), of Vornado Realty Trust, a Maryland real
estate investment trust (the "Trust"), is hereby amended by deleting Article VI,
Section 6.1 of the Declaration of Trust in its entirety and replacing it with
the following:

                  "Section 6.1 Authorized Shares. The total number of shares of
                  beneficial interest which the Trust is authorized to issue is
                  390,000,000 shares, of which 45,000,000 shall be preferred
                  shares of beneficial interest, no par value per share
                  ("Preferred Stock") (including 5,789,239 $3.25 Series A
                  Convertible Preferred Shares of Beneficial Interest,
                  liquidation preference $50.00 per share; 3,400,000 8.5% Series
                  B Cumulative Redeemable Preferred Shares of Beneficial
                  Interest, liquidation preference $25.00 per share; 4,600,000
                  8.5% Series C Cumulative Redeemable Preferred Shares of
                  Beneficial Interest, liquidation preference $25.00 per share;
                  3,500,000 Series D-1 8.5% Cumulative Redeemable Preferred
                  Shares of Beneficial Interest, liquidation preference $25.00
                  per share; 549,336 8.375% Series D-2 Cumulative Redeemable
                  Preferred Shares of Beneficial Interest, liquidation
                  preference $50.00 per share; 8,000,000 Series D-3 8.25%
                  Cumulative Redeemable Preferred Shares of Beneficial Interest,
                  liquidation preference $25.00 per share; 5,000,000 series D-4
                  8.25% Cumulative Redeemable Preferred Shares of Beneficial
                  Interest, liquidation preference $25.00 per share and
                  7,480,000 Series D-5 8.25% Cumulative Redeemable Preferred
                  Shares of Beneficial Interest, liquidation preference $25 per
                  share), 150,000,000 shares shall be common shares of
                  beneficial interest, $.04 par value per share ("Common
                  Stock"), and 195,000 shares shall be excess shares of
                  beneficial interest, $.04 par value per share ("Excess
                  Stock").

                  SECOND: The foregoing amendment has been approved by the Board
of Trustees of the Trust as required by Section

8-203(a)(7) of the Maryland REIT Law and Article IX, Section 9.1(b) of the
Declaration of Trust.

                  THIRD: The total number of shares of beneficial interest which
the Trust had authority to issue immediately prior to this amendment was
340,000,000, consisting of 125,000,000 common shares of beneficial interest,
$.04 par value per share, 45,000,000 preferred shares of beneficial interest, no
par value per share, and 170,000,000 excess shares of beneficial interest, $.04
par value per share. The aggregate par value of all authorized shares of
beneficial interest having par value was $11,800,000.

                  FOURTH: The number of shares of beneficial interest which the
Trust has authority to issue pursuant to the foregoing amendment is 390,000,000,
consisting of 150,000,000 common shares of beneficial interest, $.04 par value
per share, 45,000,000 preferred shares of beneficial interest, no par value per
share, and 195,000,000 excess shares of beneficial interest, $.04 par value per
share. The aggregate par value of all authorized shares of beneficial interest
having par value is $13,800.000.

                  FIFTH: The undersigned Chairman of the Board acknowledges this
amendment to be the trust act of the Trust and, as to all matters or facts
required to be verified under oath, the undersigned Chairman of the Board
acknowledges that, to the best of his knowledge, information and belief, these
matters and facts are true in all material respects and that his Statement is
made under the penalties for perjury.

                  IN WITNESS WHEREOF, the Trust has caused this amendment to be
signed in its name and on its behalf by its Chairman of the Board and attested
to by its Assistant Secretary on this 20th day of April, 2000.

ATTEST:

                                                     VORNADO REALTY TRUST

/s/ Larry Portal                              /s/ Steven Roth            [SEAL]
- --------------------------                    ----------------
Name:  Larry Portal                           Name:  Steven Roth
Title: Assistant Secretary                    Title: Chairman of the Board

                                       -2-

EXHIBIT 5

                                                                  April 28, 2000

Vornado Realty Trust,
      Park 80 West, Plaza II,
           Saddle Brook, New Jersey 07663.

              Re: Registration Statement on Form S-3

Ladies and Gentlemen:

                  We have served as Maryland counsel to Vornado Realty Trust, a
Maryland real estate investment trust (the "Company"), in connection with
certain matters of Maryland law arising out of the registration of 7,032,750
common shares of beneficial interest, $.04 par value per share, of the Company
(the "Shares") covered by a Registration Statement on Form S-3 to be filed with
the Securities and Exchange Commission (the "Commission"), pursuant to the
Securities Act of 1933, as amended (the "1933 Act"), and the related form of
prospectus included therein, in the form in which it will be transmitted by the
Company to the Commission under the 1933 Act (the "Registration Statement").

                  In connection with our representation of the Company, and as a
basis for the opinion hereinafter set forth, we have examined originals, or
copies certified or otherwise identified to our satisfaction, of the following
documents (hereinafter collectively referred to as the "Documents"):

Vornado Realty Trust                                                         -2-

                  1. The Registration Statement;

                  2. The Amended and Restated Declaration of Trust of the
Company, as amended (the "Declaration of Trust"), certified as of a recent date
by the State Department of Assessments and Taxation of Maryland (the "SDAT");

                  3. The Bylaws of the Company, as amended (the "Bylaws"),
certified as of the date hereof by an officer of the Company;

                  4. Resolutions adopted by the Board of Trustees, or a duly
authorized committee thereof, of the Company relating to the issuance and
registration of the Shares (the "Resolutions"), certified as of the date hereof
by an officer of the Company;

                  5. A certificate of the SDAT as to the good standing of the
Company, dated as of a recent date;

                  6. A certificate executed by an officer of the Company, dated
as of the date hereof; and

                  7. Such other documents and matters as we have deemed
necessary or appropriate to express the opinion set forth in this letter,
subject to the assumptions, limitations and qualifications stated herein.

                  In expressing the opinion set forth below, we have assumed the
following:

                  1. Each individual executing any of the Documents, whether on
behalf of such individual or another person, is legally competent to do so.

                  2. Each individual executing any of the Documents on behalf of
a party (other than the Company) is duly authorized to do so.

Vornado Realty Trust                                                         -3-

                  3. Each of the parties (other than the Company) executing any
of the Documents has duly and validly executed and delivered each of the
Documents to which such party is a signatory, and such party's obligations set
forth therein are legal, valid and binding and are enforceable in accordance
with all stated terms.

                  4. All Documents submitted to us as originals are authentic.
The form and content of any Documents submitted to us as unexecuted drafts do
not differ in any respect relevant to this opinion from the form and content of
such Documents as executed and delivered. All Documents submitted to us as
certified or photostatic copies conform to the original documents. All
signatures on all such Documents are genuine. All public records reviewed or
relied upon by us or on our behalf are true and complete. All statements and
information contained in the Documents are true and complete. There has been no
oral or written modification of or amendment to any of the Documents, and there
has been no waiver of any provision of any of the Documents, by action or
omission of the parties or otherwise.

                  5. The Shares will not be issued or transferred in violation
of any restriction or limitation contained in the Declaration of Trust.

                  Based upon the foregoing, and subject to the assumptions,
limitations and qualifications stated herein, it is our opinion that:

                  1. The Company is a real estate investment trust duly formed
and existing under and by virtue of the laws of the State of Maryland and is in
good standing with the SDAT.

                  2. The Shares have been duly authorized for issuance and, when
and if issued and delivered against payment therefor in the manner described in
the Registration Statement and the Resolutions, will be (assuming that the

Vornado Realty Trust                                                         -4-

sum of (i) all shares of beneficial interest issued as of the date hereof, (ii)
any shares of beneficial interest issued between the date hereof and any date on
which the Shares are actually issued (not including the Shares) and (iii) the
Shares will not exceed the total number of shares of beneficial interest that
the Company is then authorized to issue) validly issued, fully paid and
nonassessable.

                  The foregoing opinion is limited to the substantive laws of
the State of Maryland and we do not express any opinion herein concerning any
other law. We express no opinion as to the applicability or effect of any
federal or state securities laws, including the securities laws of the State of
Maryland, or as to federal or state laws regarding fraudulent transfers. To the
extent that any matter as to which our opinion is expressed herein would be
governed by any jurisdiction other than the State of Maryland, we do not express
any opinion on such matters.

                  We assume no obligation to supplement this opinion if any
applicable law changes after the date hereof or if we become aware of any fact
that might change the opinion expressed herein after the date hereof.

                  This opinion is being furnished to you solely for submission
to the Commission as an exhibit to the Registration Statement and, accordingly,
may not be relied upon by, quoted in any manner to, or delivered to any other
person or entity without, in each instance, our prior written consent.

                  We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement and to the use of the name of our firm therein. In
giving this consent, we do not admit that we are within the category of persons
whose consent is required by Section 7 of the 1933 Act.

                           Very truly yours,

                           /s/ Ballard Spahr Andrews & Ingersoll, LLP

EXHIBIT 8.1

                                                                  April 28, 2000

Vornado Realty Trust,
   Park 80 West, Plaza II,
      Saddle Brook, New Jersey 07663.

Dear Sirs:

                  We have acted as your counsel in connection with the
registration on the Registration Statement on Form S-3 under the Securities Act
of 1933, as amended (the "Securities Act"), of 7,032,750 shares of common stock,
par value $.04 per share, of Vornado Realty Trust ("Vornado").

                  In rendering this opinion, we have reviewed such documents as
we have considered necessary or appropriate. In addition, in rendering this
opinion, we have relied (i) as to certain factual matters upon the statements
and representations contained in the certificates provided to us by Vornado and
Two Penn Plaza REIT, Inc. ("Two Penn"), each dated April 28, 2000 (attached as
Exhibits A and B and, collectively, the "Vornado Certificates"), (ii) without
independent investigation, as to certain factual matters upon

Vornado Realty Trust                                                         -2-

the statements and representations contained in the certificate provided to us
by Alexander's, Inc. ("Alexander's") dated April 28, 2000 (attached as Exhibit C
and, together with the Vornado Certificates, the "Certificates") and (iii)
without independent investigation, upon the opinion of Shearman & Sterling,
dated April 28, 2000, concerning the qualification of Alexander's as a real
estate investment trust (a "REIT") for federal income tax purposes for each
taxable year commencing with its taxable year ending December 31, 1995 (attached
as Exhibit D, the "Shearman & Sterling Opinion"). We understand that, in
providing its Certificates, Vornado is relying upon certificates, dated April
28, 2000, provided to it by David R. Greenbaum.

                  In rendering this opinion we have also assumed, with your
approval, that (I) the statements and representations made in the Certificates
are true and correct, (II) the Certificates have been executed by appropriate
and authorized officers of Vornado, Two Penn and Alexander's and (III) the
assumptions and conditions underlying the Shearman & Sterling Opinion are true
and correct.

                  Based on the foregoing and in reliance thereon and subject
thereto and on an analysis of the Code, Treasury Regulations thereunder,
judicial authority and current administrative rulings and such other laws and
facts as we have deemed relevant and necessary, we hereby confirm our opinion
that commencing with its taxable year ending

Vornado Realty Trust                                                         -3-

December 31, 1993, Vornado has been organized in conformity with the
requirements for qualification as a REIT under the Code, and its proposed method
of operation will enable it to satisfy the requirements for qualification and
taxation as a REIT. This opinion represents our legal judgement, but it has no
binding effect or official status of any kind, and no assurance can be given
that contrary positions may not be taken by the Internal Revenue Service or a
court.

                  Vornado's qualification as a REIT will depend upon the
continuing satisfaction by Vornado and, given Vornado's current ownership
interest in Alexander's and Two Penn, by each of Alexander's and Two Penn, of
the requirements of the Code relating to qualification for REIT status, which
requirements include those that are dependent upon actual operating results,
distribution levels, diversity of stock ownership, asset composition, source of
income and recordkeeping. We do not undertake to monitor whether any of Vornado,
Alexander's or Two Penn actually has satisfied or will satisfy the various REIT
qualification tests.

                  We hereby consent to the filing with the Securities and
Exchange Commission of this letter as an exhibit to the Prospectus included in
the Registration Statement on Form S-3 and the reference to us therein under the
caption "Federal Income Tax Considerations". In giving such consent, we do not
thereby admit that we are within the category of persons whose consent is
required under Section 7 of the Securities Act.

                                                      Very truly yours,

                                                      /s/ Sullivan & Cromwell

                              Vornado Realty Trust
                             Park 80 West, Plaza II
                         Saddle Brook, New Jersey 07663

                                                                  April 28, 2000

Sullivan & Cromwell
125 Broad Street
New York, New York 10004

Ladies and Gentlemen:

     The undersigned officer of Vornado Realty Trust ("Vornado") hereby
certifies on behalf of Vornado that, after due inquiry, he has made the factual
representations set forth below and affirms as of the date hereof the accuracy
of such representations. Vornado acknowledges and understands that Sullivan &
Cromwell will be relying upon the accuracy of this certificate and these
representations in rendering an opinion regarding Vornado's qualification for
federal income tax purposes as a real estate investment trust (a "REIT"). In
providing this certificate the undersigned officer is relying upon a
certificate, dated April 28, 2000 received from David R. Greenbaum.

     1. Each of Vornado, its wholly-owned subsidiaries and Vornado Realty L.P.
have operated and will operate in accordance with (i) its organizational
document and (ii) the laws of the jurisdiction in which it is organized.

     2. Vornado is and will continue to be managed by one or more trustees.

     3. Vornado uses and will continue to use the calendar year as its
accounting period for federal income tax purposes.

     4. Vornado has made a timely election, pursuant to Section 856(c)(1) of the
Internal Revenue Code of 1986, as

Sullivan & Cromwell                                                          -2-

amended (the "Code"), to be taxed as a REIT commencing with its taxable year
ending December 31, 1993 and such election has not been terminated or revoked.

     5. As of December 31, 1993, Vornado had distributed all "earnings and
profits" (as determined for federal income tax purposes) which had been
accumulated in taxable periods prior to 1993. Vornado has had and will have, as
of the close of each taxable year subsequent to the taxable year ending December
31, 1993, no undistributed earnings and profits accumulated in any non-REIT
year.

     6. For at least 335 days of its 1993 taxable year and for each taxable year
thereafter, 100 or more persons have beneficially owned shares of beneficial
interest in Vornado ("Shares").

      7. At no time during the last half of any taxable year following its first
taxable year was more than 50 percent (as determined by reference to value) of
Vornado's outstanding Shares, owned, directly or constructively, by five or
fewer individuals (as defined in Section 542(a)(2), as modified by Section
856(h) of the Code, to include certain entities). This ownership restriction
will continue to be satisfied in the current and all future taxable years.
Constructive ownership for purposes of this representation is determined by
reference to the attribution rules of Section 544 of the Code, as modified by
Section 856(h) of the Code.

      8. The beneficial ownership of Vornado is evidenced by transferable
shares. Vornado will not impose, and is not aware of, any transfer restrictions
on the Shares other than those currently set forth in Vornado's Amended and
Restated Declaration of Trust.

      9. For Vornado's 1993 taxable year and for each of Vornado's taxable years
thereafter, at least 75 percent of Vornado's gross income has consisted of and
will continue to consist of (i) "rents from real property" within the meaning of
Section 856(d) of the Code, (ii) interest on obligations secured by mortgages on
real property or on interests in real property, (iii) gain from the sale or
other disposition

Sullivan & Cromwell                                                         -3-

of real property (including interests in real property and interests in
mortgages on real property) which is not described in Section 1221(1) of the
Code, (iv) dividends or other distributions on, and gain (other than gain from
"prohibited transactions") from the sale or other disposition of, transferable
shares in other qualifying REITs, or (v) amounts described in Sections
856(c)(3)(E) through 856 (c)(3)(I) of the Code.*

      10. For Vornado's 1993 taxable year and for each of Vornado's taxable
years thereafter, at least 95 percent of Vornado's gross income has consisted of
and will consist of (i) the items of income described in paragraph 9 hereof
(other than those described in Section 856(c)(3)(I) of the Code), (ii) gain
realized from the sale or other disposition of stock or securities which are not
property described in Section 1221(1) of the Code, (iii) interest, (iv)
dividends and (v) (x) for taxable years beginning on or before August 5, 1997,
income derived from payments to Vornado or a wholly-owned subsidiary of Vornado
on a bona fide interest rate swap or cap agreement entered into to hedge any
variable rate indebtedness of Vornado or such a subsidiary incurred or to be
incurred to acquire or carry real estate assets, or gain from the sale or other
disposition of such an agreement (an "Interest Rate Agreement") and (y) for
taxable years beginning after August 5, 1997, income derived from payments to
Vornado or a wholly-owned subsidiary of Vornado on interest rate swap or cap
agreements, options,

- --------
*    For purposes of these representations (i) all assets, liabilities and items
     of income, deduction and credit of a "qualified REIT subsidiary" (as such
     term is defined in Section 856(i) of the Code) of Vornado are treated as
     assets, liabilities and such items of Vornado and (ii) Vornado is deemed to
     own its proportionate share (determined in accordance with Treasury
     Regulations 'SS'1.856-3(g)) of each of the assets of each partnership in
     which it holds an interest (including as a result of the operation of
     clause (i)) and is deemed to be entitled to the income of the partnership
     attributable to such share.

Sullivan & Cromwell                                                          -4-

futures contracts, forward rate agreements and other similar financial
instruments entered into to reduce the interest rate risks with respect to any
indebtedness incurred or to be incurred to acquire or carry real estate assets,
or gain from the sale or other disposition of such an investment.

      11. For Vornado's 1993 taxable year and for each of Vornado's taxable
years thereafter other than taxable years beginning after August 5, 1997, less
than 30 percent of Vornado's gross income has been derived from the sale or
other disposition of (i) stock or securities (including Interest Rate
Agreements) held for less than one year, (ii) property in a transaction which is
a "prohibited transaction" (as defined in Section 857(b)(6)(B) of the Code), and
(iii) real property (including interests in real property and interests in
mortgages on real property) held for less than four years other than property
compulsorily or involuntarily converted within the meaning of Section 1033 of
the Code, and property which is foreclosure property as defined in Section
856(e) of the Code.

      12. For Vornado's 1993 taxable year and for each of Vornado's taxable
years thereafter, Vornado has not received or accrued and will not receive or
accrue any amount directly or indirectly, with respect to any real or personal
property in any case in which Vornado or any wholly-owned subsidiary of Vornado
or any partnership in which Vornado has an interest (or any agent of any of the
foregoing) furnishes or renders services to the tenants of such property, or
manages or operates such property, either (i) other than through an "independent
contractor" with respect to Vornado (within the meaning of Section 856(d)(3) of
the Code) from whom or which Vornado or such subsidiary or partnership, as the
case may be, does not derive or receive any income or, for taxable years
beginning after December 31, 2000, a "taxable REIT subsidiary" (as defined in
Section 856(l) of the Code) of Vornado (a "TRS") or (ii) other than services
usually or customarily rendered in connection with the rental of space for
occupancy only within the meaning of Treasury Regulations Section 1.512(b)-
1(c)(5), or not rendered primarily for the convenience of the occupant of the
real property, within the meaning of Treasury Regulations Section
1.512(b)-1(c)(5), except that

Sullivan & Cromwell                                                          -5-

for taxable years beginning after August 5, 1997, Vornado may receive or accrue
a de minimis amount for (i) services furnished or rendered by Vornado to the
tenants of such property (other than services described in Section 856(d)(7)(C)
of the Code) or (ii) managing or operating such property (herein "service
consideration"), in each case which does not (a) cause any amount included in
Vornado's gross income, other than such service consideration, to fail to
qualify as "rents from real property" under Section 856(d) of the Code and (b)
materially adversely affect Vornado's ability to satisfy the standards relating
to 75 percent and 95 percent of its gross income as set forth in paragraphs 9
and 10 hereof.

      13. For Vornado's 1993 taxable year and for each of Vornado's taxable
years thereafter, Vornado has not received or accrued and will continue not to
receive or accrue rent attributable to personal property except with respect to
a lease of real property where the average of the adjusted bases of the personal
property at the beginning and at the end of the taxable year does not exceed 15
percent of the average of the aggregate adjusted bases of the real property and
the personal property leased under such lease at the beginning and at the end of
such taxable year within the meaning of Section 856(d)(1) of the Code. For
taxable years beginning after December 31, 2000, "fair market values" shall be
substituted for "adjusted bases" in the preceding sentence.

      14. For Vornado's 1993 taxable year and for each of Vornado's taxable
years thereafter, Vornado has not received or accrued and will continue not to
receive or accrue, directly or indirectly, any rent or interest, where the
determination of the amount of rent or interest depends, in the case of rent, on
the income or profits of any person from the property, and, in the case of
interest, upon the income or profits of any person, except where interest or
rent is based on a fixed percentage or percentages of receipts or sales within
the meaning of Section 856(d)(2)(A) and Section 856(f)(1)(A) of the Code, and
except that Vornado may receive or accrue a de minimis amount of such rent or
interest, provided that such amount does not materially adversely affect
Vornado's ability to satisfy the

Sullivan & Cromwell                                                          -6-

standards relating to 75 percent and 95 percent of its gross income as set forth
in paragraphs 9 and 10 hereof.

      15. For Vornado's 1993 taxable year and for each of Vornado's taxable
years thereafter, Vornado has not received or accrued and will not receive or
accrue, directly or indirectly, rent or any other consideration under a lease
from any person in which Vornado owns, directly or indirectly (a) in the case of
a corporation, 10 percent or more of the total combined voting power of all
classes of stock entitled to vote, or 10 percent or more of the total number of
shares of all classes of stock, or (b) in the case of an entity other than a
corporation, an interest of 10 percent or more in the assets or net profits of
such entity, except that Vornado may receive or accrue a de minimis amount of
such rent or other consideration provided that such amount does not materially
adversely affect Vornado's ability to satisfy the standards relating to 75
percent and 95 percent of its gross income as set forth in paragraphs 9 and 10
hereof. For purposes of this paragraph ownership will be determined by taking
into account the constructive ownership rules of Section 318(a) of the Code (as
modified by Section 856(d)(5) of the Code). For Vornado's 1993 taxable year and
for each of its taxable years thereafter, Vornado has complied and will comply
with the recordkeeping and filing requirements of Treasury Regulations Section
1.856-4(b)(4).

      16. At the close of each quarter of Vornado's 1993 taxable year and of
each quarter of each of Vornado's taxable years thereafter, at least 75 percent
of the value of Vornado's total assets (as determined in accordance with
Treasury Regulations Section 1.856-2(d)) has consisted of and will continue to
consist of real estate assets within the meaning of Sections 856(c)(4) and
856(c)(5)(B) of the Code, cash and cash items (including receivables which arise
in the ordinary course of Vornado's operations, but not including receivables
purchased from another person), and Government securities.

      17. At the close of each quarter of Vornado's 1993 taxable year and,
assuming that Alexander's qualified as a REIT commencing with its taxable year
beginning January 1,

Sullivan & Cromwell                                                          -7-

1995 and will so qualify for subsequent periods, at the close of each quarter of
each of Vornado's taxable years thereafter, Vornado has not beneficially owned
and will continue not to beneficially own securities in any one issuer (except
for any securities qualifying as "real estate assets" within the meaning of
section 856(c)(5)(B) of the Code and, for taxable years beginning after December
31, 2000, securities of TRSs) having an aggregate value in excess of 5 percent
of Vornado's total assets, as determined in accordance with Treasury Regulations
Section 1.856-2(d). For taxable years beginning after December 31, 2000, Vornado
will not beneficially own securities of TRSs having an aggregate value in excess
of 20 percent of Vornado's total assets, as determined in accordance with
Treasury Regulations Section 1.856-2(d).

      18. At the close of each quarter of Vornado's 1993 taxable year and,
assuming that Alexander's qualified as a REIT commencing with its taxable year
beginning January 1, 1995 and will so qualify for subsequent periods, at the
close of each quarter of each of Vornado's taxable years thereafter, Vornado has
not beneficially owned and will continue not to beneficially own securities of
any issuer (except for any securities qualifying as "real estate assets" within
the meaning of Section 856(c)(5)(B) of the Code and, for taxable years beginning
after December 31, 2000, securities of TRSs) representing more than 10 percent
of the outstanding voting securities of such issuer. For taxable years beginning
after December 31, 2000, at the close of each quarter of each taxable year,
Vornado will not beneficially own more than 10 percent of the total value of the
securities of any single issuer other than (i) securities issued by TRSs, (ii)
securities qualifying as "real estate assets" within the meaning of Section
856(c)(5)(B) of the Code), (iii) securities issued by "qualified REIT
subsidiaries of Vornado and (iv) securities that are otherwise not subject to
the provisions of Section 856(c)(4)(B)(iii)(III) of the Code as in effect for
taxable years beginning after December 31, 2000.

      19. At no time since January 1, 1993 has Vornado or a direct or indirect
wholly-owned subsidiary of Vornado owned

Sullivan & Cromwell                                                          -8-

and Vornado will not in the future own, more than 10 percent of the outstanding
voting securities of any issuer other than (i) since March 2, 1995, Alexander's,
Inc., (ii) an issuer in which Vornado or, for periods after January 1, 1993, a
direct or indirect wholly-owned subsidiary of Vornado, has held all of the
outstanding shares at all times since the formation of such issuer, (iii) Two
Penn Plaza REIT, Inc. and (iv) for taxable years beginning after December 31,
2000, a TRS. Notwithstanding the foregoing, for taxable years beginning after
August 5, 1997, Vornado may have wholly-owned subsidiaries whose shares it has
not held at all times; provided that in connection with those subsidiaries
Vornado complies with the requirements of Section 856(i) of the Code.

      20. For Vornado's 1993 taxable year and for each of Vornado's taxable
years thereafter, Vornado has complied with and will continue to comply with the
shareholder solicitation and the record-keeping requirements prescribed by
Section 857(a)(2) of the Code while still in effect and Section 857(f) of the
Code thereafter and by Treasury Regulations Section 1.857-8.

      21. For Vornado's 1993 taxable year and each taxable year thereafter
Vornado has distributed and will continue to distribute to its shareholders
amounts equal in the aggregate to at least 95 percent of Vornado's "real estate
investment trust taxable income" (determined without regard to the deduction for
dividends paid (as defined in section 561 of the Code)) and by excluding any net
capital gain (within the meaning of Section 857(a)(1)(A) of the Code), plus at
least 95 percent of the excess of any "net income from foreclosure property"
over the tax imposed by Section 857(b)(4)(A) of the Code on such net income, if
any, as such terms in quotations are defined in Sections 857(b)(2) and
857(b)(4)(B), respectively, of the Code, during the taxable year involved or
during the period thereafter as prescribed by Section 858 of the Code.
Similarly, Vornado has complied with and will continue to comply with the
distribution requirements imposed by Notice 88-19 in respect of "built-in gains"
recognized by Vornado. For taxable years beginning after December 31, 2000, "90
percent" shall be substituted for "95 percent" in this representation.

Sullivan & Cromwell                                                          -9-

      22. Each distribution by Vornado that is treated as a dividend within the
meaning of Section 316 of the Code will qualify for the deduction for dividends
paid under Section 561 of the Code, and without limiting the foregoing, Vornado
will not make any distribution that constitutes a preferential dividend as
described in Section 562(c) of the Code.

      23. Vornado will at all times beneficially hold all of its assets for
investment purposes and not as (i) stock in trade or other property of a kind
which would properly be includible in inventory on hand at the close of a
taxable year or (ii) property held primarily for sale to customers in the
ordinary course of Vornado's trade or business.

      24. Vornado does not own and has not owned since January 1, 1993 any REMIC
residual interests.

      25. Vornado has not, since January 1, 1993, and will not hold a
partnership interest, unless such partnership is treated at all times for
federal income tax purposes as a partnership and not as an association taxable
as a corporation (including a publicly-traded partnership that is treated as a
corporation under Section 7704 of the Code).*

      26. Vornado is a "domestically-controlled REIT" within the meaning of
Section 897(h)(4)(B) of the Code (that is, at all times during the last five
years less than 50 percent (as determined by reference to value) of the
outstanding interests in Vornado, or the predecessor of Vornado, have been held,
directly or indirectly, by foreign persons).

      27. Vornado is not a "pension-held REIT" within the meaning of Section
856(h)(3)(D) of the Code (that is, either (i) it is not the case that Vornado
fails to be closely-held (within the meaning of Section 856(h) of the Code
solely as a result of Section 856(h)(3) of the Code or (ii) certain other
conditions are met).

- --------
*    For these purposes we are disregarding a partnership between two
     wholly-owned subsidiaries of Vornado.

Sullivan & Cromwell                                                         -10-

      28. Vornado has made a timely election, pursuant to Notice 88-19, to be
subject to rules similar to the rules of Section 1374 of the Code with respect
to built-in gains recognized during the ten-year period following its initial
qualification as a REIT.

      29. Vornado has at all times dealt, and will continue to deal, with
Vornado Management Corp., The Mendik Management Company, Inc. and Vornado RR,
Inc. on an arm's length basis. Furthermore, Vornado will deal on an arm's length
basis with any corporation in which Vornado owns, directly or indirectly,
non-voting shares, which is not a wholly-owned subsidiary of Vornado.

      30. In addition to those representations set forth in this officer's
certificate relating to the qualification of Vornado as a REIT, Vornado will
comply with all other requirements under the Code (including, without
limitation, Sections 856 through 860 of the Code) in order to maintain its
qualification as a REIT.

      31. Vornado believes, based upon an opinion received from Shearman &
Sterling and upon representations received by it from Alexander's, that
Alexander's qualified as a REIT for its taxable year beginning January 1, 1995
and will so qualify for subsequent periods.

      32. Neither Vornado nor any of its subsidiaries (including for this
purpose any entity at least 95% of the nonvoting stock of which is owned by
Vornado) have performed, or will perform, any services for Alexander's or Two
Penn Plaza REIT, Inc., any of their subsidiaries or any partnership or other
unincorporated entity in which Alexander's or Two Penn Plaza REIT, Inc. holds
(directly or indirectly) an interest, that would cause any income realized by
Alexander's or Two Penn Plaza REIT, Inc. (or any such subsidiary, partnership or
other entity) from and after July 1, 1994, to fail to be described in Section
856(c)(2) of the Code.

         IN WITNESS WHEREOF, I have, on behalf of Vornado, signed this officers
certificate as of this 28 day of April, 2000.

                                                   VORNADO REALTY TRUST

                                                   By: /s/ Joseph Macnow
                                                       -------------------------
                                                       Name:  Joseph Macnow
                                                       Title: Executive Vice
                                                              President

                            Two Penn Plaza REIT, Inc.
                             Park 80 West, Plaza II
                         Saddle Brook, New Jersey 07663

                                                                  April 28, 2000

Sullivan & Cromwell
125 Broad Street
New York, New York 10004

Ladies and Gentlemen:

     The undersigned officer of Two Penn Plaza REIT, Inc. ("Two Penn") hereby
certifies on behalf of Two Penn that, after due inquiry, he has made the factual
representations set forth below and affirms as of the date hereof the accuracy
of such representations. Two Penn acknowledges and understands that Sullivan &
Cromwell will be relying upon the accuracy of this certificate and these
representations in rendering an opinion regarding Vornado Realty Trust's
("Vornado") qualification for federal income tax purposes as a real estate
investment trust (a "REIT"). In providing this certificate the undersigned
officer is relying upon a certificate, dated April 28, 2000, received by David
R. Greenbaum.

      1. Two Penn and each of its wholly-owned subsidiaries has operated and
will operate in accordance with (i) its organizational document and (ii) the
laws of the jurisdiction in which it is organized.

      2. Two Penn has been and will be managed by one or more trustees or
directors.

      3. Two Penn has used and will use the calendar year as its accounting
period for federal income tax purposes.

      4. Two Penn has made a timely election, pursuant to Section 856(c)(1) of
the Internal Revenue Code of 1986, as amended (the "Code"), to be taxed as a
real estate investment trust commencing with its first taxable year.

      5. As of the close of its first taxable year and each

Sullivan & Cromwell                                                          -2-

taxable year thereafter, Two Penn will have no undistributed earnings and
profits accumulated in any non-REIT year.

      6. For at least 335 days of each taxable year following its first taxable
year, 100 or more persons will beneficially own shares of beneficial interest in
Two Penn ("Shares").

      7. At no time during the last half of any taxable year following its first
taxable year will more than 50 percent (as determined by reference to value) of
Two Penn's outstanding Shares, be owned, directly or constructively, by five or
fewer individuals (as defined in Section 542(a)(2), as modified by Section
856(h) of the Code, to include certain entities). Constructive ownership for
purposes of this representation is determined by reference to the attribution
rules of Section 544 of the Code, as modified by Section 856(h) of the Code.

      8. The beneficial ownership of Two Penn will be evidenced by transferable
shares. Two Penn will not impose any transfer restrictions on the Shares other
than those designed to enable Two Penn to qualify as a REIT for federal income
tax purposes.

      9. For each of Two Penn's taxable years, at least 75 percent of Two Penn's
gross income will consist of (i) "rents from real property" within the meaning
of Section 856(d) of the Code, (ii) interest on obligations secured by mortgages
on real property or on interests in real property, (iii) gain from the sale or
other disposition of real property (including interests in real property and
interests in mortgages on real property) which is not described in Section
1221(1) of the Code, (iv) dividends or other distributions on, and gain (other
than gain from "prohibited transactions") from the sale or other disposition of,
transferable shares in other qualifying real estate investment trusts, or (v)
amounts described in Sections 856(c)(3)(E) through 856 (c)(3)(I) of the Code.*

- --------

*     For purposes of these representations (i) all assets, liabilities and
      items of income, deduction and credit

Sullivan & Cromwell                                                          -3-

      10. For each of Two Penn's taxable years, at least 95% of Two Penn's gross
income will consist of (i) the items of income described in paragraph 9 hereof
(other than those described in Section 856(c)(3)(I) of the Code), (ii) gain
realized from the sale or other disposition of stock or securities which are not
property described in Section 1221(1) of the Code, (iii) interest, (iv)
dividends and (v) (x) for taxable years beginning on or before August 5, 1997,
income derived from payments to Two Penn or a wholly- owned subsidiary of Two
Penn on a bona fide interest rate swap or cap agreement entered into to hedge
any variable rate indebtedness of Two Penn or such a subsidiary incurred or to
be incurred to acquire or carry real estate assets or gain from the sale or
other disposition of such an agreement (an "Interest Rate Agreement") and (y)
for taxable years beginning after August 5, 1997, income derived from payments
to Two Penn or a wholly-owned subsidiary of Two Penn on interest rate swap or
cap agreements, options, futures contracts, forward rate agreements and other
similar financial instruments entered into to reduce the interest rate risks
with respect to any indebtedness incurred or to be incurred to acquire or carry
real estate assets, or gain from the sale or other disposition of such an
investment.

      11. For each of Two Penn's taxable years other than taxable years
beginning after August 5, 1997, less than 30 percent of Two Penn's gross income
was derived from the sale or other disposition of (i) stock or securities
(including Interest Rate Agreements) held for less than one year, (ii) property
in a transaction which is a "prohibited

- -----------

      of a "qualified REIT subsidiary" (as such term is defined in Section
      856(i) of the Code) of Two Penn will be treated as assets, liabilities and
      such items of Two Penn and (ii) Two Penn will be deemed to own its
      proportionate share (determined in accordance with Treasury
      Regulations 'SS'1.856-3(g)) of each of the assets of each partnership in
      which it holds an interest (including as a result of the operation of
      clause (i)) and deemed to be entitled to the income of the partnership
      attributable to such share.

Sullivan & Cromwell                                                          -4-

transaction" (as defined in Section 857(b)(6)(B) of the Code), and (iii) real
property (including interests in real property and interests in mortgages on
real property) held for less than four years other than property compulsorily or
involuntarily converted within the meaning of Section 1033 of the Code, and
property which is foreclosure property as defined in Section 856(e) of the Code.

      12. For each of Two Penn's taxable years, Two Penn has not received or
accrued and will not receive or accrue any amount, directly or indirectly, with
respect to any real or personal property in any case in which Two Penn or any
wholly-owned subsidiary of Two Penn or any partnership in which Two Penn has an
interest (or any agent of any of the foregoing) furnishes or renders services to
the tenants of such property, or manages or operates such property, either (i)
other than through an "independent contractor" with respect to Two Penn (within
the meaning of Section 856(d)(3) of the Code) from whom or which Two Penn or
such subsidiary or partnership, as the case may be, does not derive or receive
any income or, for taxable years beginning after December 31, 2000, a "taxable
REIT subsidiary" (as defined in Section 856(l) of the Code) of Two Penn (a
"TRS") or (ii) other than services usually or customarily rendered in connection
with the rental of space for occupancy only within the meaning of Treasury
Regulations Section 1.512(b)- 1(c)(5), or not rendered primarily for the
convenience of the occupant of the real property, within the meaning of Treasury
Regulations Section 1.512(b)-1(c)(5), except that for taxable years beginning
after August 5, 1997, Two Penn may receive or accrue a de minimis amount for (i)
services furnished or rendered by Two Penn to the tenants of such property
(other than services described in Section 856(d)(7)(C) of the Code) or (ii)
managing or operating such property (herein "service consideration"), in each
case which does not (a) cause any amount included in Two Penn's gross income,
other than such service consideration, to fail to qualify as "rents from real
property" under Section 856(d) of the Code and (b) materially adversely affect
Two Penn's ability to satisfy the standards relating to 75 percent and 95
percent of its gross income as set forth in paragraphs 9 and 10 hereof.

Sullivan & Cromwell                                                          -5-

         13. For each of Two Penn's taxable years, Two Penn will not receive or
accrue rent attributable to personal property except with respect to a lease of
real property where the average of the adjusted bases of the personal property
at the beginning and at the end of the taxable year does not exceed 15 percent
of the average of the aggregate adjusted bases of the real property and the
personal property leased under such lease at the beginning and at the end of
such taxable year within the meaning of Section 856(d)(1) of the Code. For
taxable years beginning after December 31, 2000, "fair market values" shall be
substituted for "adjusted bases" in the preceding sentence.

      14. For each of Two Penn's taxable years, Two Penn will not receive or
accrue, directly or indirectly, any rent or interest, where the determination of
the amount of rent or interest depends, in the case of rent, on the income or
profits of any person from the property, and, in the case of interest, upon the
income or profits of any person, except where interest or rent is based on a
fixed percentage or percentages of receipts or sales within the meaning of
Section 856(d)(2)(A) and Section 856(f)(1)(A) of the Code, and except that Two
Penn may receive or accrue a de minimis amount of such rent or interest,
provided that such amount does not materially adversely affect Two Penn's
ability to satisfy the standards relating to 75 percent and 95 percent of its
gross income as set forth in paragraphs 9 and 10 hereof.

      15. For each of Two Penn's taxable years, Two Penn will not receive or
accrue, directly or indirectly, rent or any other consideration under a lease
from any person in which Two Penn owns, directly or indirectly (a) in the case
of a corporation, 10 percent or more of the total combined voting power of all
classes of stock entitled to vote, or 10 percent or more of the total number of
shares of all classes of stock, or (b) in the case of an entity other than a
corporation, an interest of 10 percent or more in the assets or net profits of
such entity, except that Two Penn may receive or accrue a de minimis amount of
such rent or other consideration provided that such amount does not materially
adversely affect Two Penn's ability to satisfy the standards

Sullivan & Cromwell                                                          -6-

relating to 75 percent and 95 percent of its gross income as set forth in
paragraphs 9 and 10 hereof. For purposes of this paragraph ownership will be
determined by taking into account the constructive ownership rules of Section
318(a) of the Code (as modified by Section 856(d)(5) of the Code). For each of
Two Penn's taxable years, Two Penn has complied and will comply with the
recordkeeping and filing requirements of Treasury Regulations Section
1.856-4(b)(4).

      16. At the close of each quarter of each of Two Penn's taxable years, at
least 75 percent of the value of Two Penn's total assets (as determined in
accordance with Treasury Regulations Section 1.856-2(d)) has consisted of and
will continue to consist of real estate assets within the meaning of Sections
856(c)(4) and 856(c)(5)(B) of the Code, cash and cash items (including
receivables which arise in the ordinary course of Two Penn's operations, but not
including receivables purchased from another person), and Government securities.

      17. At the close of each quarter of each of Two Penn's taxable years, (i)
Two Penn will not beneficially own securities in any one issuer (except for any
securities qualifying as "real estate assets" within the meaning of section
856(c)(5)(B) of the Code and, for taxable years beginning after December 31,
2000, securities of TRSs) having an aggregate value in excess of 5 percent of
Two Penn's total assets, as determined in accordance with Treasury Regulations
Section 1.856-2(d) and (ii) for taxable years beginning after December 31, 2000,
Two Penn will not beneficially own securities of TRSs having an aggregate value
in excess of 20 percent of Two Penn's total assets, as determined in accordance
with Treasury Regulations Section 1.856-2(d).

      18. At the close of each quarter of each taxable year of Two Penn, (i) Two
Penn will not beneficially own securities of any issuer (except for any
securities qualifying as "real estate assets" within the meaning of Section
856(c)(5)(B) of the Code and, for taxable years beginning after December 31,
2000, securities of TRSs) representing more than 10 percent of the outstanding
voting securities of such issuer and (ii) for taxable years

Sullivan & Cromwell                                                          -7-

beginning after December 31, 2000, Two Penn will not beneficially own securities
of any issuer (except for securities qualifying as "real estate assets" within
the meaning of Section 856(c)(5)(B) of the Code or securities of TRSs)
representing more than 10 percent of the value of the outstanding securities of
such issuer.

      19. For each of Two Penn's taxable years, Two Penn has complied with and
will continue to comply with the shareholder solicitation and the record-keeping
requirements prescribed by Section 857(a)(2) of the Code while still in effect
and Section 857(f) of the Code thereafter and by Treasury Regulations Section
1.857-8.

      20. For each of Two Penn's taxable years, Two Penn will distribute to its
shareholders amounts equal in the aggregate to at least 95 percent of Two Penn's
"real estate investment trust taxable income" (determined without regard to the
deduction for dividends paid (as defined in section 561 of the Code)) and by
excluding any net capital gain (within the meaning of Section 857(a)(1)(A) of
the Code), plus at least 95 percent of the excess of any "net income from
foreclosure property" over the tax imposed by Section 857(b)(4)(A) of the Code
on such net income, if any, as such terms in quotations are defined in Sections
857(b)(2) and 857(b)(4)(B), respectively, of the Code, during the taxable year
involved or during the period thereafter as prescribed by Section 858 of the
Code. For taxable years beginning after December 31, 2000, "90 percent" shall be
substituted for "95 percent" in the this representation.

      21. Each distribution by Two Penn that is treated as a dividend within the
meaning of Section 316 of the Code will qualify for the deduction for dividends
paid under Section 561 of the Code, and without limiting the foregoing, Two Penn
will not make any distribution that constitutes a preferential dividend as
described in Section 562(c) of the Code.

      22. Two Penn will at all times beneficially hold all of its assets for
investment purposes and not as (i) stock in trade or other property of a kind
which would properly be includible in inventory on hand at the close of a
taxable

Sullivan & Cromwell                                                          -8-

year or (ii) property held primarily for sale to customers in the ordinary
course of Two Penn's trade or business.

      23. Two Penn will not own any REMIC residual interests.

      24. Two Penn will not hold a partnership interest unless such partnership
is treated at all times for federal income tax purposes as a partnership and not
as an association taxable as a corporation (including a publicly- traded
partnership that is treated as a corporation under Section 7704 of the Code).

      25. In addition to those representations set forth in this officer's
certificate relating to the qualification of Two Penn as a REIT for federal
income tax purposes, Two Penn will comply with all other requirements under the
Code (including, without limitation, Sections 856 through 860 of the Code) in
order to maintain its qualification as a REIT.

      IN WITNESS WHEREOF, I have, on behalf of Two Penn, signed this officers
certificate as of this 28 day of April, 2000.

                                                    TWO PENN PLAZA REIT, INC.

                                                    By: /s/ Joseph Macnow
                                                        ------------------------
                                                        Name: Joseph Macnow
                                                        Title: Executive Vice
                                                               President

                                Alexander's, Inc.
                             Park 80 West, Plaza II
                             Saddle Brook, NJ 07663

                                                                  April 28, 2000

Sullivan & Cromwell
125 Broad Street
New York, New York 10004

Ladies and Gentlemen:

                  The undersigned officer of Alexander's, Inc. (the "Company")
hereby certifies on behalf of the Company that, after due inquiry, he has made
the representations set forth below and affirms as of the date hereof the
accuracy of such representations. The Company acknowledges and understands that
Shearman & Sterling will be relying upon the accuracy of this certificate and
these representations in (i) rendering an opinion regarding the election made by
the Company to be treated for federal income tax purposes as a real estate
investment trust (a "REIT") within the meaning of Section 856(a) of the Internal
Revenue Code of 1986, as amended (the "Code"), and (ii) allowing the Shearman &
Sterling name and opinion to be included by reference in the opinion letter
given by Sullivan & Cromwell in connection with the registration of 7,032,750
shares of common stock, par value $.04 per share, of Vornado Realty Trust on
April 28, 2000 on the Registration Statement on Form S-3 under the Securities
Act of 1933, as amended. In certain of these representations, the Company is
relying on representations furnished to it by Vornado Realty Trust.

                  1. The Company has operated, and will continue to operate, in
accordance with (i) its organizational document and (ii) the laws of the
jurisdiction in which it is organized.

                  2. The Company has been, and will continue to be, managed by a
board of directors.

                  3. Since January 1, 1995, the taxable year of the Company has
been the calendar year.

                  4. The Company has made a valid election to be taxed as a REIT
for its taxable year ended December 31, 1995, which election has not been, and
will not be, revoked or terminated.

                  5. For its taxable year ended December 31, 1995, the Company
had a deficit in earnings and profits (as defined in the Code) in excess of its
accumulated earnings and profits (if any) as of the close of its taxable year
ended December 31, 1994.

                  6. For each taxable year of the Company commencing with the
Company's taxable year ended December 31, 1995, at least 75 percent of the
Company's annual gross income has consisted, and will continue to consist, of
(i) "rents from real property" within the meaning of Section 856(d) of the Code,
(ii) interest on obligations secured by mortgages on real property or on
interests in real property, (iii) gain from the sale or other disposition of
real property (including interests in real property and interests in mortgages
on real property) which is not described in Section 1221(l) of the Code, or (iv)
amounts described in Sections 856(c)(3)(D) through 856(c)(3)(I) of the Code.(1)

                  7. For each taxable year of the Company commencing with the
Company's taxable year ended December 31, 1995, at least 95 percent of the
Company's annual gross income has consisted, and will continue to consist, of
(i) the items of income described in paragraph 6 hereof (other than those
described in Section 856(c)(3)(I) of the Code), (ii) gain realized from the sale
or other disposition of stock or securities which are not property described in
Section 1221(l) of the Code, (iii) interest, (iv) dividends and (v) income
derived from payments to the Company on interest rate swap or cap agreements,
options, futures contracts, forward rate agreements and other similar financial
instruments entered into to reduce the interest rate risks with respect to any
indebtedness incurred or to be incurred to acquire or carry real estate assets,
or gain from the sale or other disposition of such an investment.

                  8. Since January 1, 1995, the Company has not received or
accrued, and will not receive or accrue, any amount (herein "service
consideration"), directly or indirectly, with respect to any real or personal
property in any case in which the Company or any wholly-owned subsidiary of the
Company or any partnership or tenancy-in-common in which the Company has an
interest (or any agent of any of the foregoing) furnishes or renders services to
the tenants of such property, or manages or operates such property other than
(i) through an "independent contractor" with respect to the Company (within the
meaning of Section 856(d)(3) of the Code) from whom or which the Company or such
subsidiary, partnership or

- --------

(1)  For purposes of these representations (i) all assets, liabilities and items
     of income, deduction and credit of a "qualified REIT subsidiary" (as such
     term is defined in Section 856(i) of the Code) of the Company are treated
     as assets, liabilities and such items of the Company and (ii) the Company
     is deemed to own its proportionate share (determined in accordance with
     Treasury Regulations 'SS' 1.856-3(g)) of each of the assets of each
     partnership or tenancy-in-common in which it holds an interest (including
     as a result of the operation of clause (i)) and is deemed to be entitled to
     the income of the partnership or tenancy-in-common attributable to such
     share.

tenancy-in-common, as the case may be, does not derive or receive any income;
(ii) services usually or customarily rendered in connection with the rental of
space for occupancy only within the meaning of Treasury Regulations Section
1.512(b)-l(c)(5), or not rendered primarily for the convenience of the occupant
of the real property, within the meaning of Treasury Regulations Section
1.512(b)-l(c)(5); or (iii) actions carried out by or on behalf of the directors
of the Company as a part of performing their fiduciary duty to manage the
Company, which need not be delegated or contracted out to independent
contractors, pursuant to Treasury Regulations Section 1.856-4(b)(5)(ii), except
that the Company may receive or accrue a de minimis amount of service
consideration which does not (a) cause any amount included in the Company's
gross income, other than such service consideration, to fail to qualify as
"rents from real property" under Section 856(d) of the Code or (b) materially
adversely affect the Company's ability to satisfy the standards relating to 75
percent and 95 percent of its gross income as set forth in paragraphs 6 and 7
hereof.

                  9. Since January 1, 1995, the Company has not received or
accrued, and will not receive or accrue, rent attributable to personal property
except with respect to a lease of real property where the average of the
adjusted bases of the personal property at the beginning and at the end of the
taxable year does not exceed 15 percent of the average of the aggregate adjusted
bases of the real property and the personal property leased under such lease at
the beginning and at the end of such taxable year within the meaning of Section
856(d)(1) of the Code.

                  10. Since January 1, 1995, the Company has not received or
accrued, and will not receive or accrue, directly or indirectly, any rent or
interest, where the determination of amount of rent or interest depends, in the
case of rent, on the income or profits of any person from the property, and, in
the case of interest, upon the income or profits of any person, except where
interest or rent is based on a fixed percentage or percentages of receipts or
sales within the meaning of Section 856(d)(2)(A) and Section 856(f)(1)(A) of the
Code, and except that the Company may receive or accrue a de minimis amount of
such rent or interest, provided that such amount does not materially adversely
affect the Company's ability to satisfy the standards relating to 75 percent and
95 percent of its gross income as set forth in paragraphs 6 and 7 hereof.

                  11. The Company will not receive or accrue (and since January
1, 1995, has not received or accrued) any amount from (i) any corporation in
which it owns (or since July 1, 1994, has owned) 10 percent or more of the total
combined voting power of all shares of stock entitled to vote or 10 percent or
more of the total number of shares of all classes of stock of such corporation,
or (ii) any unincorporated entity in which it owns (or since July 1, 1994, has
owned) an interest of 10 percent or more in the assets or net profits of such
person. For purposes of this assumption, ownership is determined in accordance
with section 856(d)(5) of the Code. Since January 1, 1995, the Company has
complied, and will continue to comply, with the recordkeeping and filing
requirements of Treasury Regulations Section 1.856-4(b)(4).

                  12. Since January 1, 1995, at the close of each quarter of the
Company's taxable year, at least 75 percent of the value of the Company's total
assets (as determined in accordance with Treasury Regulations Section
1.856-2(d)) has consisted, and will continue to consist, of real estate assets
within the meaning of Sections 856(c)(4) and 856(c)(5)(B) of the Code, cash and
cash items (including receivables which arise in the ordinary course of the
Company's operations, but not including receivables purchased from another
person), and Government securities.

                  13. Since January 1, 1995, at the close of each quarter of the
Company's taxable year, the Company has not beneficially owned, and will not
beneficially own, securities in any one issuer (except for any securities
qualifying as "real estate assets" within the meaning of section 856(c)(5)(B) of
the Code) having an aggregate value in excess of 5 percent of the Company's
total assets, as determined in accordance with Treasury Regulations Section
1.856- 2(d).

                  14. Since January 1, 1995, at the close of each quarter of the
Company's taxable year, the Company has not beneficially owned, and will not
beneficially own, securities of any issuer (except for any securities qualifying
as "real estate assets" within the meaning of section 856(c)(5)(B) of the Code)
representing more than 10 percent of the outstanding voting securities of such
issuer.

                  15. The Company has requested and maintained, and will
continue to request and maintain, records concerning ownership of its
outstanding shares in accordance with section 857(f)(1) of the Code and Treasury
Regulations promulgated thereunder and predecessor requirements.

                  16. The Company has made, and will make, distributions to its
stockholders sufficient to meet the 95 percent distribution requirements of
section 857(a)(1) of the Code for the taxable year for which the REIT election
was made and every subsequent taxable year. In this connection, the Company has
complied with and will continue to comply with the distribution requirements
imposed by Notice 88-19 in respect of "built-in gains" recognized by the
Company.

                  17. Each distribution by the Company that is treated as a
dividend within the meaning of Section 316 of the Code will qualify for the
deduction for dividends paid under Section 561 of the Code, and without limiting
the foregoing, the Company will not make any distribution that constitutes a
preferential dividend as described in Section 562(c) of the Code.

                  18. At all times, the Company has beneficially held, and will
continue to beneficially hold, all of its assets for investment purposes and not
as (i) stock in trade or other property of a kind which would properly be
includible in inventory at hand at the close of a taxable year or (ii) property
held primarily for sale to customers in the ordinary course of the Company's
trade or business.

                  19. The Company has not held, and will not hold, a partnership
interest, unless such partnership is treated at all times for federal income tax
purposes as a partnership and not as an association taxable as a corporation
(including a publicly traded partnership that is treated as a corporation under
Section 7704 of the Code).

                  20. Since January 1, 1995, the outstanding shares of the
Company have been held by at least 100 or more persons, and such shares will
continue to be held by 100 or more persons.

                  21. Not more than 50 percent in value of the outstanding
shares of the Company have been or will be owned directly or indirectly,
actually or constructively (within the meaning of section 542(a)(2) of the Code,
as modified by section 856(h) of the Code), by five or fewer individuals (or
entities treated as individuals for purposes of section 856(h) of the Code)
during the second half of every taxable year following the taxable year ended
December 31, 1995.

                  22. In addition to those representations set forth in this
officer's certificate relating to the qualification of the Company as a REIT,
the Company has complied, and will continue to comply, with all other
requirements under the Code (including, without limitation, Sections 856 through
860 of the Code) in order to qualify as a REIT for each of the Company's taxable
years since January 1, 1995.

                  IN WITNESS WHEREOF, I have, on behalf of the Company, signed
this officers certificate as of this 28th day of April 2000.

                                              ALEXANDER'S INC.

                                              By: /s/ Irwin Goldberg
                                                  ----------------------------
                                                  Name:  Irwin Goldberg
                                                  Title: Treasurer

                                Alexander's, Inc.
                             Park 80 West, Plaza II
                             Saddle Brook, NJ 07663

                                                                  April 28, 2000

Vornado Realty Trust
Park 80 West, Plaza II
Saddle Brook, NJ 07663

Ladies and Gentlemen:

                  The undersigned officer of Alexander's, Inc. (the "Company")
hereby certifies on behalf of the Company that, after due inquiry, he has made
the representations set forth below and affirms as of the date hereof the
accuracy of such representations. The Company acknowledges and understands that
Shearman & Sterling will be relying upon the accuracy of this certificate and
these representations in (i) rendering an opinion regarding the election made by
the Company to be treated for federal income tax purposes as a real estate
investment trust (a "REIT") within the meaning of Section 856(a) of the Internal
Revenue Code of 1986, as amended (the "Code"), and (ii) allowing the Shearman &
Sterling name and opinion to be included by reference in the opinion letter
given by Sullivan & Cromwell in connection with the registration of 7,032,750
shares of common stock, par value $.04 per share, of Vornado Realty Trust on
April 28, 2000 on the Registration Statement on Form S-3 under the Securities
Act of 1933, as amended. In certain of these representations, the Company is
relying on representations furnished to it by Vornado Realty Trust.

                  1. The Company has operated, and will continue to operate, in
accordance with (i) its organizational document and (ii) the laws of the
jurisdiction in which it is organized.

                  2. The Company has been, and will continue to be, managed by a
board of directors.

                  3. Since January 1, 1995, the taxable year of the Company has
been the calendar year.

                  4. The Company has made a valid election to be taxed as a REIT
for its taxable year ended December 31, 1995, which election has not been, and
will not be, revoked or terminated.

                  5. For its taxable year ended December 31, 1995, the Company
had a deficit in earnings and profits (as defined in the Code) in excess of its
accumulated earnings and profits (if any) as of the close of its taxable year
ended December 31, 1994.

                  6. For each taxable year of the Company commencing with the
Company's taxable year ended December 31, 1995, at least 75 percent of the
Company's annual gross income has consisted, and will continue to consist, of
(i) "rents from real property" within the meaning of Section 856(d) of the Code,
(ii) interest on obligations secured by mortgages on real property or on
interests in real property, (iii) gain from the sale or other disposition of
real property (including interests in real property and interests in mortgages
on real property) which is not described in Section 1221(l) of the Code, or (iv)
amounts described in Sections 856(c)(3)(D) through 856(c)(3)(I) of the Code.(2)

                  7. For each taxable year of the Company commencing with the
Company's taxable year ended December 31, 1995, at least 95 percent of the
Company's annual gross income has consisted, and will continue to consist, of
(i) the items of income described in paragraph 6 hereof (other than those
described in Section 856(c)(3)(I) of the Code), (ii) gain realized from the sale
or other disposition of stock or securities which are not property described in
Section 1221(l) of the Code, (iii) interest, (iv) dividends and (v) income
derived from payments to the Company on interest rate swap or cap agreements,
options, futures contracts, forward rate agreements and other similar financial
instruments entered into to reduce the interest rate risks with respect to any
indebtedness incurred or to be incurred to acquire or carry real estate assets,
or gain from the sale or other disposition of such an investment.

                  8. Since January 1, 1995, the Company has not received or
accrued, and will not receive or accrue, any amount (herein "service
consideration"), directly or indirectly, with respect to any real or personal
property in any case in which the Company or any wholly- owned subsidiary of the
Company or any partnership or tenancy-in-common in which the Company has an
interest (or any agent of any of the foregoing) furnishes or renders services to
the tenants of such property, or manages or operates such property other than
(i) through an "independent contractor" with respect to the Company (within the
meaning of Section 856(d)(3) of the Code) from whom or which the Company or such
subsidiary, partnership or

- --------
(2)  For purposes of these representations (i) all assets, liabilities and items
     of income, deduction and credit of a "qualified REIT subsidiary" (as such
     term is defined in Section 856(i) of the Code) of the Company are treated
     as assets, liabilities and such items of the Company and (ii) the Company
     is deemed to own its proportionate share (determined in accordance with
     Treasury Regulations 'SS' 1.856-3(g)) of each of the assets of each
     partnership or tenancy-in-common in which it holds an interest (including
     as a result of the operation of clause (i)) and is deemed to be entitled to
     the income of the partnership or tenancy-in-common attributable to such
     share.

tenancy-in-common, as the case may be, does not derive or receive any income;
(ii) services usually or customarily rendered in connection with the rental of
space for occupancy only within the meaning of Treasury Regulations Section
1.512(b)-l(c)(5), or not rendered primarily for the convenience of the occupant
of the real property, within the meaning of Treasury Regulations Section
1.512(b)-l(c)(5); or (iii) actions carried out by or on behalf of the directors
of the Company as a part of performing their fiduciary duty to manage the
Company, which need not be delegated or contracted out to independent
contractors, pursuant to Treasury Regulations Section 1.856-4(b)(5)(ii), except
that the Company may receive or accrue a de minimis amount of service
consideration which does not (a) cause any amount included in the Company's
gross income, other than such service consideration, to fail to qualify as
"rents from real property" under Section 856(d) of the Code or (b) materially
adversely affect the Company's ability to satisfy the standards relating to 75
percent and 95 percent of its gross income as set forth in paragraphs 6 and 7
hereof.

                  9. Since January 1, 1995, the Company has not received or
accrued, and will not receive or accrue, rent attributable to personal property
except with respect to a lease of real property where the average of the
adjusted bases of the personal property at the beginning and at the end of the
taxable year does not exceed 15 percent of the average of the aggregate adjusted
bases of the real property and the personal property leased under such lease at
the beginning and at the end of such taxable year within the meaning of Section
856(d)(1) of the Code.

                  10. Since January 1, 1995, the Company has not received or
accrued, and will not receive or accrue, directly or indirectly, any rent or
interest, where the determination of amount of rent or interest depends, in the
case of rent, on the income or profits of any person from the property, and, in
the case of interest, upon the income or profits of any person, except where
interest or rent is based on a fixed percentage or percentages of receipts or
sales within the meaning of Section 856(d)(2)(A) and Section 856(f)(1)(A) of the
Code, and except that the Company may receive or accrue a de minimis amount of
such rent or interest, provided that such amount does not materially adversely
affect the Company's ability to satisfy the standards relating to 75 percent and
95 percent of its gross income as set forth in paragraphs 6 and 7 hereof.

                  11. The Company will not receive or accrue (and since January
1, 1995, has not received or accrued) any amount from (i) any corporation in
which it owns (or since July 1, 1994, has owned) 10 percent or more of the total
combined voting power of all shares of stock entitled to vote or 10 percent or
more of the total number of shares of all classes of stock of such corporation,
or (ii) any unincorporated entity in which it owns (or since July 1, 1994, has
owned) an interest of 10 percent or more in the assets or net profits of such
person. For purposes of this assumption, ownership is determined in accordance
with section 856(d)(5) of the Code. Since January 1, 1995, the Company has
complied, and will continue to comply, with the recordkeeping and filing
requirements of Treasury Regulations Section 1.856-4(b)(4).

                  12. Since January 1, 1995, at the close of each quarter of the
Company's taxable year, at least 75 percent of the value of the Company's total
assets (as determined in accordance with Treasury Regulations Section
1.856-2(d)) has consisted, and will continue to consist, of real estate assets
within the meaning of Sections 856(c)(4) and 856(c)(5)(B) of the Code, cash and
cash items (including receivables which arise in the ordinary course of the
Company's operations, but not including receivables purchased from another
person), and Government securities.

                  13. Since January 1, 1995, at the close of each quarter of the
Company's taxable year, the Company has not beneficially owned, and will not
beneficially own, securities in any one issuer (except for any securities
qualifying as "real estate assets" within the meaning of section 856(c)(5)(B) of
the Code) having an aggregate value in excess of 5 percent of the Company's
total assets, as determined in accordance with Treasury Regulations Section
1.856-2(d).

                  14. Since January 1, 1995, at the close of each quarter of the
Company's taxable year, the Company has not beneficially owned, and will not
beneficially own, securities of any issuer (except for any securities qualifying
as "real estate assets" within the meaning of section 856(c)(5)(B) of the Code)
representing more than 10 percent of the outstanding voting securities of such
issuer.

                  15. The Company has requested and maintained, and will
continue to request and maintain, records concerning ownership of its
outstanding shares in accordance with section 857(f)(1) of the Code and Treasury
Regulations promulgated thereunder and predecessor requirements.

                  16. The Company has made, and will make, distributions to its
stockholders sufficient to meet the 95 percent distribution requirements of
section 857(a)(1) of the Code for the taxable year for which the REIT election
was made and every subsequent taxable year. In this connection, the Company has
complied with and will continue to comply with the distribution requirements
imposed by Notice 88-19 in respect of "built-in gains" recognized by the
Company.

                  17. Each distribution by the Company that is treated as a
dividend within the meaning of Section 316 of the Code will qualify for the
deduction for dividends paid under Section 561 of the Code, and without limiting
the foregoing, the Company will not make any distribution that constitutes a
preferential dividend as described in Section 562(c) of the Code.

                  18. At all times, the Company has beneficially held, and will
continue to beneficially hold, all of its assets for investment purposes and not
as (i) stock in trade or other property of a kind which would properly be
includible in inventory at hand at the close of a taxable year or (ii) property
held primarily for sale to customers in the ordinary course of the Company's
trade or business.

                  19. The Company has not held, and will not hold, a partnership
interest, unless such partnership is treated at all times for federal income tax
purposes as a partnership and not as an association taxable as a corporation
(including a publicly traded partnership that is treated as a corporation under
Section 7704 of the Code).

                  20. Since January 1, 1995, the outstanding shares of the
Company have been held by at least 100 or more persons, and such shares will
continue to be held by 100 or more persons.

                  21. Not more than 50 percent in value of the outstanding
shares of the Company have been or will be owned directly or indirectly,
actually or constructively (within the meaning of section 542(a)(2) of the Code,
as modified by section 856(h) of the Code), by five or fewer individuals (or
entities treated as individuals for purposes of section 856(h) of the Code)
during the second half of every taxable year following the taxable year ended
December 31, 1995.

                  22. In addition to those representations set forth in this
officer's certificate relating to the qualification of the Company as a REIT,
the Company has complied, and will continue to comply, with all other
requirements under the Code (including, without limitation, Sections 856 through
860 of the Code) in order to qualify as a REIT for each of the Company's taxable
years since January 1, 1995.

                  IN WITNESS WHEREOF, I have, on behalf of the Company, signed
this officers certificate as of this 28th day of April 2000.

                                          ALEXANDER'S INC.

                                           By:  /s/ Irwin Goldberg
                                                -------------------------
                                                Name:   Irwin Goldberg
                                                Title:  Treasurer

                              Vornado Realty Trust
                             Park 80 West, Plaza II
                         Saddle Brook, New Jersey 07663

                                                                  April 28, 2000

Alexander's, Inc.
Park 80 West, Plaza II
Saddle Brook, NJ  07663

Gentlemen:

                  Vornado Realty Trust, a real estate investment trust organized
under the laws of the State of Maryland ("Vornado"), is delivering this letter
to you for purposes of your representations to Shearman & Sterling in connection
with their opinion regarding the election made by Alexander's, Inc.
("Alexander's") to be treated as a real estate investment trust within the
meaning of Section 856(a) of the Internal Revenue Code of 1986, as amended (the
"Code"). Vornado hereby represents and warrants to Alexander's that, from and
after July 1, 1994:

                  (i) neither Vornado nor any of its subsidiaries (including for
         this purpose any entity at least 95% of the preferred stock of which is
         owned by Vornado) (collectively the "Vornado Entities") have performed,
         or will perform, any services for Alexander's, for any of its
         subsidiaries or for any partnership or other unincorporated entity in
         which Alexander's holds (directly or indirectly) an interest
         (collectively the "Alexander's Entities"), that would cause any income
         realized by Alexander's (or any such subsidiary, partnership or other
         entity) from and after July 1, 1994, to fail to be described in Section
         856(c)(2) of the Code;

                 (ii) all services performed, or to be performed, by Interstate
         Properties, a New Jersey general partnership, for any of the
         Alexander's Entities were performed, or will be performed, by Vornado
         Entities on behalf of Interstate Properties; and

                 (iii) none of the Vornado Entities have performed, or will
         perform, any services on behalf of Interstate Properties for any of the
         Alexander's Entities that would cause any income realized by
         Alexander's (or by any of the Alexander's Entities) from and after July
         1, 1994, to fail to be described in Section 856(c)(2) of the Code.

                                                    Very truly yours,

                                                    /s/ Irwin Goldberg
                                                    ---------------------------
                                                    Irwin Goldberg
                                                    Chief Financial Officer

                                                                  April 28, 2000

Two Penn Plaza REIT, Inc.
Park 80 West, Plaza II
Saddle Brook, New Jersey

Ladies and Gentlemen:

          The undersigned David R. Greenbaum hereby certifies to Two Penn Plaza
REIT, Inc. ("Two Penn") and Sullivan & Cromwell that, after due inquiry, he has
made the factual representations set forth below and affirms as of the date
hereof the accuracy of such representations. David R. Greenbaum acknowledges and
understands that Two Penn will be relying upon the accuracy of this certificate
and these representations in providing representations to Sullivan & Cromwell in
connection with Sullivan & Cromwell's rendering its opinion regarding Vornado
Realty Trust's ("Vornado") qualification for federal income tax purposes as a
real estate investment trust (a "REIT").

          These representations assume that (i) no relationship exists between
Two Penn and any tenant of Two Penn (either through actual or constructive
ownership) resulting from the stock ownership of Vornado that would cause rents
to be treated as "related party rents" and (ii) no ownership relationship exists
between Vornado and BMS LLC (either through actual or constructive ownership)
that would cause BMS LLC not to be treated as an independent contractor within
the meaning of Section 856(d)(3) of the Code. These representations treat the
arrangements pursuant to which the entity which the owners of Two Penn provide
steam, chilled water, security and engineering services to

Two Penn Plaza REIT, Inc.                                                    -2-

adjacent properties as cost sharing arrangements from which no gross income
arises.

          These representations do not apply to (i) assets held by Two Penn
other than historic assets of Two Penn Plaza Associates, L.P. (the "Historic
Assets"), and (ii) gross income arising from assets other than the Historic
Assets. For these purposes, Two Penn will be treated as owning its share (as
determined under Treasury Regulation 1.856-3(g)) of the assets of, and as
deriving directly its share (as determined under Treasury Regulation 1.856-3(g))
of the gross income of, any entity (i) in which it owns an interest and (ii)
which is treated as a partnership for federal income tax purposes.

     1. For each of Two Penn's taxable years, at least 75% of the gross income
required to be taken into account by Two Penn (for purposes of determining its
qualification as a real estate investment trust) with respect to the Historic
Assets taken as a whole will consist of (i) "rents from real property" within
the meaning of Section 856(d) of the Internal Revenue Code of 1986, as amended
(the "Code"), (ii) interest on obligations secured by mortgages on real property
or on interests in real property, (iii) gain from the sale or other disposition
of real property (including interests in real property and interests in
mortgages on real property) which is not described in Section 1221(1) of the
Code, (iv) dividends or other distributions on, and gain (other than gain from
"prohibited transactions") from the sale or other disposition of, transferable
shares in qualifying real estate investment trusts, and (v) amounts described in
Sections 856(c)(3)(E) through 856(c)(3)(I) of the Code.

     2. For each of Two Penn's taxable years, at least 95% of the gross income
required to be taken into account by Two Penn (for purposes of determining its
qualification as a real estate investment trust) with respect to the Historic
Assets taken as a whole will consist of (i) the items of income described in
paragraph 1 hereof (other than those described in Section 856(c)(3)(I) of the
Code), (ii) gain realized from the sale or other disposition of stock or
securities which are not property described in Section 1221(1) of the Code,
(iii) interest, (iv) dividends

Two Penn Plaza REIT, Inc.                                                    -3-

and (v) (x) for taxable years beginning on or before August 5, 1997, income
derived from payments to Two Penn on interest rate swaps or cap agreements
entered into to hedge any variable rate indebtedness of Two Penn incurred or to
be incurred to acquire or carry real property, or gain from the sale or other
disposition of such an agreement (an "Interest Rate Agreement") and (y) for
taxable years beginning after August 5, 1997, income derived from payments to
Two Penn or a wholly-owned subsidiary of Two Penn on interest rate swap or cap
agreements, options, futures contracts, forward rate agreements or other similar
financial instruments entered into to reduce the interest rate risks with
respect to any indebtedness incurred or to be incurred to acquire or carry real
estate assets, or gain from the sale or other disposition of such an investment.

     3. For each of Two Penn's taxable years other than taxable years beginning
after August 5, 1997, less than 30% of the gross income required to be taken
into account by Two Penn (for purposes of determining its qualification as a
real estate investment trust) with respect to the Historic Assets taken as a
whole was derived from the sale or other disposition of (i) stock or securities
(including Interest Rate Agreements) held for less than one year, (ii) property
in a transaction which would be a "prohibited transaction" (as defined in
Section 857(b)(6)(B) of the Code), and (iii) real property (including interests
in real property and interests in mortgages on real property) held for less than
four years other than property compulsorily or involuntarily converted within
the meaning of Section 1033 of the Code, and property which is foreclosure
property as defined in Section 856(e) of the Code.

     4. For each of Two Penn's taxable years, Two Penn will not receive or
accrue any amount required to be taken into account by Two Penn (for purposes of
determining its qualification as a real estate investment trust) with respect to
the Historic Assets, directly or indirectly, with respect to any real or
personal property in any case in which Two Penn or any entity in which it has an
interest (or any agent of any of the foregoing) furnishes or renders services to
the tenants of such property, or manages or operates such property, either (i)
other than through an "independent contractor" with respect to Two Penn (within
the meaning of Section 856(d)(3) of the Code) from whom Two

Two Penn Plaza REIT, Inc.                                                   -4-

Penn does not derive or receive any income or, for taxable years beginning after
December 31, 2000, a "taxable REIT subsidiary" (as defined in Section 856(1) of
the Code) of Two Penn (a "TRS") or (ii) other than services (x) usually or
customarily rendered in connection with the rental of space for occupancy only
within the meaning of Treasury Regulations Section 1.512(b)-1(c)(5), or (y) not
rendered primarily for the convenience of the occupant of the real property
within the meaning of Treasury Regulations Section 1.512(b)-1(c)(5). For taxable
years beginning after August 5, 1997, Two Penn will not receive or accrue,
directly or indirectly, any "impermissible tenant service income" within the
meaning of Section 856(d)(7) of the Code.

     5. For each of Two Penn's taxable years, Two Penn will not receive or
accrue rent required to be taken into account by Two Penn (for purposes of
determining its qualification as a real estate investment trust) with respect to
the Historic Assets attributable to personal property except with respect to a
lease of real property where the average of the adjusted bases of the personal
property at the beginning and at the end of the taxable year does not exceed 15
percent of the average of the aggregate adjusted bases of the real property and
the personal property leased under such lease at the beginning and at the end of
such taxable year within the meaning of Section 856 (d)(1) of the Code. For
taxable years beginning after December 31, 2000, "fair market values" shall be
substituted for "adjusted bases" in the preceding sentence.

     6. For each of Two Penn's taxable years, Two Penn will not receive or
accrue, directly or indirectly, any rent or interest required to be taken into
account by Two Penn (for purposes of determining its qualification as a real
estate investment trust) with respect to the Historic Assets, where the
determination of the amount of rent or interest depends, in the case of rent, on
the income or profits of any person from the property, and, in the case of
interest, upon the income or profits of any person, except where interest or
rent is based on a fixed percentage or percentages of receipts or sales within
the meaning of Section 856(d)(2)(A) and Section 856(f)(1)(A) of the Code.

     7. For each of Two Penn's taxable years, Two Penn

Two Penn Plaza REIT, Inc.                                                    -5-

will not receive or accrue, directly or indirectly, rent or any other
consideration required to be taken into account by Two Penn (for purposes of
determining its qualification as a real estate investment trust) with respect to
the Historic Assets under a lease from any person in which Two Penn owns,
directly or indirectly (a) in the case of a corporation, 10 percent or more of
the total combined voting power of all classes of stock entitled to vote, or 10
percent or more of the total number of shares of all classes of stock, or (b) in
the case of an entity other than a corporation, an interest of 10 percent or
more in the assets or net profits of such entity. For purposes of this paragraph
ownership will be determined by taking into account the constructive ownership
rules of Section 318(a) of the Code (as modified by Section 856(d)(5) of the
Code).

     8. At the close of each quarter of each of Two Penn's taxable years, all of
Two Penn's total assets (as determined in accordance with Treasury Regulations
Section 1.856-2(d)) will consist of real estate assets within the meaning of
Sections 856(c)(4) and 856(c)(5)(B) of the Code, cash and cash items (including
receivables which arise in the ordinary course of Two Penn's operations, but not
including receivables purchased from another person), and Government securities
(other than temporary investments of idle funds which will not cause Two Penn to
violate the asset tests of Section 856(c)(4) of the Code).

     9. At the close of each quarter of each of Two Penn's taxable years, Two
Penn will not beneficially own securities of any issuer other than securities
qualifying as "real estate assets" within the meaning of Section 856(c)(5)(B) of
the Code (other than temporary investments of idle funds which will not cause
Two Penn to violate the asset tests of Section 856(c)(4) of the Code). For
taxable years beginning after December 31, 2000, Two Penn will not beneficially
own securities of TRSs having an aggregate value in excess of 20 percent of Two
Penn's total assets, as determined in accordance with Treasury Regulations
Section 1.856-2(d).

     10. Two Penn will at all times beneficially hold all of its assets for
investment purposes and not as (i) stock in trade or other property of a kind
which would properly be includible in inventory on hand at the close of a
taxable year or (ii) property held primarily for sale to customers

Two Penn Plaza REIT, Inc.                                                   -6-

in the ordinary course of a trade or business.

     11. Two Penn will not own any REMIC residual interests.

     12. In addition to those representations above, the operations of Two Penn
will be conducted so as to allow it to comply with all other requirements under
the Code (including, without limitation, Sections 856 through 860 of the Code)
necessary for it to maintain qualification as a REIT.

     13. Two Penn Plaza Associates, L.P. terminated at the Effective Time (as
defined in the Master Consolidation Agreement dated March 12, 1997, between
Vornado, Vornado/Saddle Brook L.L.C., The Mendik Company, L.P. and certain other
parties) under Section 708 of the Code.

     This certificate is being furnished to you in my capacity as an employee of
Two Penn and by your acceptance of this certificate you agree that, in
connection with the furnishing of this certificate, I am entitled to the
benefits of the indemnification rights set forth on Annex A hereto.

     IN WITNESS WHEREOF, I have signed this certificate as of this 28 day of
April, 2000.

                              By: /s/ David R. Greenbaum
                                  ------------------------------
                                  Name:  David R. Greenbaum
                                  Title:

                                                                         Annex A

          This will confirm that (a) David R. Greenbaum is hereby designated as
an "indemnities" under the declaration of trust and bylaws of Vornado Realty
Trust and (b) David R. Greenbaum will be exculpated from liability to the extent
set forth in the declaration of trust or bylaws of Vornado Realty Trust;
provided, that such indemnification shall not extend to cover any costs,
expenses or liabilities arising out of (i) actions taken by David R. Greenbaum
or matters other than the furnishing of the certificate to which this Annex A is
attached or (ii) actions to the extent such actions are taken with respect to
matters that are covered by the indemnification obligations of FW/Mendik REIT,
L.L.C. and certain of its affiliates under the Indemnification Agreement, dated
as of March __, 1997.

                                                                  April 28, 2000

Vornado Realty Trust
Park 80 West, Plaza II
Saddle Brook, New Jersey

Ladies and Gentlemen:

          The undersigned David R. Greenbaum hereby certifies to Vornado Realty
Trust ("Vornado") and Sullivan & Cromwell that, after due inquiry, he has made
the factual representations set forth below and affirms as of the date hereof
the accuracy of such representations. David R. Greenbaum acknowledges and
understands that Vornado will be relying upon the accuracy of this certificate
and these representations in providing representations to Sullivan & Cromwell in
connection with Sullivan & Cromwell's rendering its opinion regarding Vornado's
qualification for federal income tax purposes as a real estate investment trust
(a "REIT").

          For purposes of the following representations, "Property Partnerships"
refer to Vornado Realty L.P., 1740 Broadway Associates L.P., 1740 Investment
Company, Two Park Company, B&B Park Avenue L.P., 866 U.N. Plaza Associates LLC,
Two Penn Plaza Associates L.P., Eleven Penn Plaza Company, M 393 Associates, M/F
Associates, M/S Associates, M/F Eleven Associates, M/S Eleven Associates, M
Eleven Associates, M330 Associates, 330 Madison Company, 570 Lexington Company,
L.P., and 570 Lexington Associates, L.P.

Vornado Realty Trust                                                         -2-

          These representations assume that (i) no relationship exists between
Vornado and any tenant of the Property Partnerships (either through actual or
constructive ownership) resulting from the stock ownership of Vornado that would
cause rents to be treated as "related party rents" and (ii) no ownership
relationship exists between Vornado and BMS LLC (either through actual or
constructive ownership) that would cause BMS LLC not to be treated as an
independent contractor within the meaning of Section 856(d)(3) of the Code.
These representations treat the arrangements pursuant to which the owners of Two
Penn Plaza and 866 U.N. Plaza provide steam, chilled water, security and
engineering services to adjacent properties as cost sharing arrangements from
which no gross income arises.

          For periods following the Effective Time (as defined in the Master
Consolidation Agreement, dated March 12, 1997, between Vornado, Vornado/Saddle
Brook L.L.C., The Mendik Company, L.P. and certain other parties (the
"Consolidation Agreement")), these representations do not apply to (i) assets
held by Vornado other than the Mendik Properties as defined in the Consolidation
Agreement, the assets contributed by The Mendik Group to Vornado Realty L.P. at
the Effective Time and assets acquired by the Mendik division of Vornado
following the Effective Time (the "Mendik Assets"), i.e., these representations
apply only with respect to the Mendik Assets, and (ii) gross income arising from
Vornado assets other than the Mendik assets.

     1. For Vornado's 1997 taxable year and for each subsequent taxable year, at
least 75% of the gross income required to be taken into account by Vornado (for
purposes of determining its qualification as a real estate investment trust)
with respect to the Mendik Assets taken as a whole will consist of (i) "rents
from real property" within the meaning of Section 856(d) of the Internal Revenue
Code of 1986, as amended (the "Code") (with the character of an item of income
being determined with respect to each Property Partnership as if the Property
Partnership were a real estate investment trust ("REIT") for federal tax
purposes), (ii) interest on obligations secured by mortgages on real property or
on interests in real property, (iii) gain from the sale or other disposition of
real property (including interests in real property and interests in mortgages
on

Vornado Realty Trust                                                         -3-

real property) which is not described in Section 1221(1) of the Code, (iv)
dividends or other distributions on, and gain (other than gain from "prohibited
transactions") from the sale or other disposition of, transferable shares in
qualifying REITs, and (v) amounts described in Sections 856(c)(3)(E) through
856(c)(3)(I) of the Code.*

         2. For Vornado's 1997 taxable year and for each subsequent taxable
year, at least 95% of the gross income required to be taken into account by
Vornado (for purposes of determining its qualification as a real estate
investment trust) with respect to the Mendik Assets taken as a whole will
consist of (i) the items of income described in paragraph 1 hereof (other than
those described in Section 856(c)(3)(I) of the Code), (ii) gain realized from
the sale or other disposition of stock or securities which are not property
described in Section 1221(1) of the Code, (iii) interest, (iv) dividends and (v)
(x) for taxable years beginning on or before August 5, 1997, income derived from
payments to the Property Partnerships on bona fide interest

- -------------

*     For purposes of these representations, the assets and gross income of each
      of the Property Partnerships will be determined as if such entity were a
      REIT for purposes of determining the nature of its income and assets. Thus
      each Property Partnership will be deemed to own its proportionate share
      (determined in accordance with Treasury Regulation 'SS' 1.856-3(g)) of
      each of the assets of each entity that is treated as a partnership for
      federal tax purposes in which such Property Partnership holds, or is
      treated as holding, an interest and is deemed to derive directly the
      income of such entities attributable to such share. For purposes of these
      representations, however, none of the Property Partnerships will be
      treated as a REIT for purposes of determining whether a subsidiary of such
      Property Partnerships is a "qualified REIT subsidiary" within the meaning
      of Section 856(i) of the Code.

      In treating the Property Partnerships as a whole for purposes of certain
      of these representations, gross income has not been double counted as a
      result of Treasury Regulation 1.856-3(g) or as a result of disregarding
      entities.

Vornado Realty Trust                                                         -4-

rate swaps or cap agreements entered into to hedge any variable rate
indebtedness of the Property Partnerships incurred or to be incurred to
acquire or carry real property, or gain from the sale or other disposition
of such an agreement (an "Interest Rate Agreement") and (y) for taxable years
beginning after August 5, 1997, income derived from payments to the Property
Partnerships on interest rate swap or cap agreements, options, futures
contracts, forward rate agreements and other similar financial instruments
entered into to reduce the interest rate risks with respect to any indebtedness
incurred or to be incurred to acquire or carry real estate assets, or gain
from the sale or other disposition of such an investment.

         3. For Vornado's 1997 taxable year, less than 30% of the gross income
required to be taken into account by Vornado (for purposes of determining its
qualification as a real estate investment trust) with respect to the Mendik
Assets taken as a whole was derived from the sale or other disposition of (i)
stock or securities (including Interest Rate Agreements) held for less than one
year, (ii) property in a transaction which, had each Property Partnership been a
REIT, would be a "prohibited transaction" (as defined in Section 857(b)(6)(B) of
the Code, but without regard to Section 857(b)(6)(C) of the Code), and (iii)
real property (including interests in real property and interests in mortgages
on real property) held for less than four years other than property compulsorily
or involuntarily converted within the meaning of Section 1033 of the Code, and
property which is foreclosure property as defined in Section 856(e) of the Code.

         4. For Vornado's 1997 taxable year and for each subsequent taxable
year, each of the Property Partnerships did not receive or accrue and will not
receive or accrue any amount required to be taken into account by Vornado (for
purposes of determining its qualification as a real estate investment trust)
with respect to the Mendik Properties, directly or indirectly, with respect to
any real or personal property in any case in which the Property Partnership or
any entity in which it has an interest (or any agent of any of the foregoing)
furnishes or renders services to the tenants of such property, or manages or
operates such property, either (i) other than through an "independent

Vornado Realty Trust                                                        -5-

contractor" with respect to such Property Partnership and Vornado (within the
meaning of Section 856(d)(3) of the Code) from whom or which such Property
Partnership and Vornado do not derive or receive any income or, for taxable
years beginning after December 31, 2000, a "taxable REIT subsidiary" (as defined
in Section 856(l) of the Code) of Vornado (a "TRS") or (ii) other than services
(x) usually or customarily rendered in connection with the rental of space for
occupancy only within the meaning of Treasury Regulations Section
1.512(b)-1(c)(5), or (y) not rendered primarily for the convenience of the
occupant of the real property within the meaning of Treasury Regulations Section
1.512(b)-1(c)(5). This representation assumes that any parking services rendered
to tenants at Two Park Avenue would be rendered by BMS LLC for periods after the
Effective Date. For taxable years beginning after August 5, 1997, none of the
Property Partnerships will receive or accrue, directly or indirectly, any
"impermissible tenant service income" within the meaning of Section 856(d)(7) of
the Code.

     5. For Vornado's 1997 taxable year and for each subsequent taxable year,
each of the Property Partnerships has not received or accrued and will continue
not to receive or accrue rent required to be taken into account by Vornado (for
purposes of determining its qualification as a real estate investment trust)
with respect to the Mendik Properties attributable to personal property except
with respect to a lease of real property where the average of the adjusted bases
of the personal property at the beginning and at the end of the taxable year
does not exceed 15 percent of the average of the aggregate adjusted bases of the
real property and the personal property leased under such lease at the beginning
and at the end of such taxable year within the meaning of Section 856(d)(1) of
the Code. For taxable years beginning after December 31, 2000, "fair market
values" shall be substituted for "adjusted bases" in the preceding sentence.

     6. For Vornado's 1997 taxable year and for each subsequent taxable year,
each of the Property Partnerships has not received or accrued and will continue
not to receive or accrue, directly or indirectly, any rent or interest required
to be taken into account by Vornado (for purposes of determining its
qualification as a real estate investment

Vornado Realty Trust                                                         -6-

trust) with respect to the Mendik Properties, where the determination of the
amount of rent or interest depends, in the case of rent, on the income or
profits of any person from the property, and, in the case of interest, upon the
income or profits of any person, except where interest or rent is based on a
fixed percentage or percentages of receipts or sales within the meaning of
Section 856(d)(2)(A) and Section 856(f)(1)(A) of the Code.

     7. For Vornado's 1997 taxable year and for each subsequent taxable year,
other than with respect to Mendik Realty, Inc.'s lease at 330 Madison Avenue and
the M 393 sublease from Times Mirror, each of the Property Partnerships has not
received or accrued and will not receive or accrue, directly or indirectly, rent
or any other consideration required to be taken into account by Vornado for
purposes of determining its qualification as a real estate investment trust)
with respect to the Mendik Properties under a lease from any person in which
such Property Partnership or Vornado owns, directly or indirectly (a) in the
case of a corporation, 10 percent or more of the total combined voting power of
all classes of stock entitled to vote, or 10 percent or more of the total number
of shares of all classes of stock, or (b) in the case of an entity other than a
corporation, an interest of 10 percent or more in the assets or net profits of
such entity. For purposes of this paragraph ownership will be determined by
taking into account the constructive ownership rules of Section 318(a) of the
Code (as modified by Section 856(d)(5) of the Code).

     8. Subject to paragraph 12 below, at the close of each quarter subsequent
to the Effective Time of Vornado's taxable year ending December 31, 1997 and at
the close of each quarter of each of Vornado's taxable years thereafter, all of
the Property Partnerships' total assets (as determined in accordance with
Treasury Regulations Section 1.856-2(d)) has consisted of and will continue to
consist of real estate assets within the meaning of Sections 856(c)(4) and
856(c)(5)(B) of the Code, cash and cash items (including receivables which arise
in the ordinary course of the Property Partnership's operations, but not
including receivables purchased from another person), and Government securities
(other than temporary

Vornado Realty Trust                                                         -7-

investments of idle funds which will not cause the Property Partnerships to
violate the asset tests of Section 856(c)(4) of the Code). For taxable years
beginning after December 31, 2000, the Property Partnerships will not
beneficially own securities of TRSs having an aggregate value in excess of 20
percent of the total assets of the Property Partnerships, as determined in
accordance with the principles of Treasury Regulations Section 1.856-2(d).

     9. Subject to paragraph 12 below, at the close of each quarter subsequent
to the Effective Time of Vornado's taxable year ending December 31, 1997 and at
the close of each quarter of each of Vornado's taxable years thereafter, each of
the Property Partnerships has not beneficially owned and will continue not to
beneficially own securities of any issuer other than securities qualifying as
"real estate assets" within the meaning of Section 856(c)(5)(B) of the Code
(other than temporary investments of idle funds which will not cause the
Property Partnerships to violate the asset tests of Section 856(c)(4) of the
Code).

     10. Each Property Partnership will at all times beneficially hold all of
its assets for investment purposes and not as (i) stock in trade or other
property of a kind which would properly be includible in inventory on hand at
the close of a taxable year or (ii) property held primarily for sale to
customers in the ordinary course of a trade or business.

     11. Each Property Partnership does not own and will not own any REMIC
residual interests.

     12. Vornado Realty L.P. owns only nonvoting interests in the Management
Corporation (as defined in the Consolidation Agreement) and the value of the
securities of the Management Corporation (as defined in the Consolidation
Agreement) owned by Vornado Realty L.P. will at all times be less than 5% of the
total value of the assets of Vornado Realty L.P.

     13. In addition to those representations above, the operations of the
Property Partnerships will be conducted so as to allow Vornado to comply with
all other requirements under the Code (including, without limitation, Sections
856

Vornado Realty Trust                                                         -8-

through 860 of the Code) necessary for Vornado to maintain qualification as a
REIT.

     14. The activities of each Property Partnership have been and will be
conducted in accordance with the relevant partnership's organizational documents
and no Property Partnership is or will be properly classifiable as a corporation
for federal income tax purposes.

     15. Each Property Partnership either (i) terminated at the Effective Time
under Section 708 of the Code or (ii) allocated income to its direct and
indirect partners before and after the Effective Time based on a closing of the
books method.

     This certificate is being furnished to you in my capacity as an employee of
Vornado and by your acceptance of this certificate you agree that, in connection
with the furnishing of this certificate, I am entitled to the benefits of the
indemnification rights set forth on Annex A hereto.

     IN WITNESS WHEREOF, I have signed this certificate as of this 28 day of
April, 2000.

                                                 By:/s/ David R. Greenbaum
                                                    ----------------------
                                                    Name:  David R. Greenbaum
                                                    Title:

                                                                         Annex A

          This will confirm that (a) David R. Greenbaum is hereby designated as
an "indemnitee" under the declaration of trust and bylaws of Vornado Realty
Trust and (b) David R. Greenbaum will be exculpated from liability to the extent
set forth in the declaration of trust or bylaws of Vornado Realty Trust;
provided, that such indemnification shall not extend to cover any costs,
expenses or liabilities arising out of (i) actions taken by David R. Greenbaum
or matters other than the furnishing of the certificate to which this Annex A is
attached or (ii) actions to the extent such actions are taken with respect to
matters that are covered by the indemnification obligations of FW/Mendik REIT,
L.L.C. and certain of its affiliates under the Indemnification Agreement, dated
as of March __, 1997.

EXHIBIT 8.2

                                     April 28, 2000

Vornado Realty Trust
Park 80 West, Plaza II
Saddle Brook, NJ 07663

Sullivan & Cromwell
125 Broad Street
New York, NY 10004

                            Alexander's REIT Election

Dear Sirs:

                  In connection with the registration of 7,032,750 shares of
common stock, par value $.04 per share, of Vornado Realty Trust on April 28,
2000 on the Registration Statement on Form S-3 under the Securities Act of 1933,
as amended (the "Registration"), you have requested our opinion with regard to
the election by Alexander's, Inc. ("Alexander's") to be treated for Federal
income tax purposes as a real estate investment trust (a "REIT"), within the
meaning of section 856(a) of the Internal Revenue Code of 1986, as amended (the
"Code"). We understand that Alexander's has elected to be treated as a REIT
initially for its taxable year ended December 31, 1995, and intends to continue
to be so treated for subsequent taxable years.

                  In rendering this opinion, we have relied as to certain
factual matters upon the statements and representations contained in the
certificate provided to us by Alexander's (the "Alexander's Certificate") dated
April 28, 2000. We have assumed that the statements made in the Alexander's
Certificate are true and correct and that the Alexander's Certificate has been
executed by appropriate and authorized officers of Alexander's.

                  In rendering this opinion, with your permission we have also
made the following assumptions, which are based on factual representations made
by Alexander's and certified to us:

                  (a) Alexander's has made a valid election to be taxed as a
         REIT for its taxable year ended December 31, 1995, which election has
         not been, and will not be, revoked or terminated.

                  (b) Since January 1, 1995, the outstanding shares of
         Alexander's have been held by at least 100 or more persons, and such
         shares will continue to be held by 100 or more persons.

                  (c) Not more than 50 percent in value of the outstanding
         shares of Alexander's have been or will be owned directly or
         indirectly, actually or constructively (within the meaning of section
         542(a)(2) of the Code, as modified by section 856(h) of the Code), by
         five or fewer individuals (or entities treated as individuals for
         purposes of section 856(h) of the Code) during the second half of every
         taxable year following the taxable year ended December 31, 1995.

                  (d) Alexander's will not receive or accrue (and since January
         1, 1995, has not received or accrued) any amount from (i) any
         corporation in which it owns (or since July 1, 1994, has owned) 10
         percent or more of the total combined voting power of all shares of
         stock entitled to vote or 10 percent or more of the total number of
         shares of all classes of stock of such corporation, or (ii) any
         unincorporated entity in which it owns (or since July 1, 1994, has
         owned) an interest of 10 percent or more in the assets or net profits
         of such person. For purposes of this assumption, ownership is
         determined in accordance with section 856(d)(5) of the Code.

                  (e) Alexander's has requested and maintained, and will
         continue to request and maintain, records concerning ownership of its
         outstanding shares in accordance with section 857(f)(1) of the Code and
         Treasury Regulations promulgated thereunder and predecessor
         requirements.

                  (f) Alexander's has made and will make distributions to its
         stockholders sufficient to meet the 95 percent distribution
         requirements of section 857(a)(1) of the Code for the taxable year for
         which the REIT election was made and every subsequent taxable year.

                  (g) For its taxable year ended December 31, 1995, Alexander's
         had a deficit in earnings and profits (as defined in the Code) in
         excess of its accumulated earnings and profits (if any) as of the close
         of its taxable year ended December 31, 1994.

                  Based on the foregoing and in reliance thereon and subject
thereto and on an analysis of the Code, Treasury Regulations thereunder,
judicial authority and current administrative rulings and such other laws and
facts as we have deemed relevant and

necessary, we are of the opinion that commencing with its taxable year ended
December 31, 1995, Alexander's has been organized and operated in conformity
with the requirements for qualification and taxation as a REIT under the Code,
and its proposed method of operation will enable it to continue to meet the
requirements for qualification and taxation as a REIT under the Code.

                  Qualification of Alexander's as a REIT will depend upon the
satisfaction by Alexander's and its subsidiaries (the "Company"), through actual
operating results, distribution levels, diversity of stock ownership and
otherwise, of the applicable asset composition, source of income, shareholder
diversification, distribution, recordkeeping and other requirements of the Code
necessary for a corporation to qualify as a REIT. No assurance can be given that
the actual results of the Company's operations for any one taxable year will
satisfy all such requirements. We do not undertake to monitor whether the
Company actually has satisfied or actually will satisfy the various
qualification tests, and we express no opinion whether the Company actually has
satisfied or actually will satisfy these various qualification tests.

                  This opinion is based on current Federal income tax law, and
we do not undertake to advise you as to future changes in Federal income tax law
that may affect this opinion unless we are specifically engaged to do so. This
opinion relates solely to Federal income tax law, and we do not undertake to
render any opinion as to the taxation of the Company under any state or local
corporate franchise or income tax law.

                  We hereby consent to the use of our name and the reference to
this opinion letter in the opinion letter given by Sullivan & Cromwell in
connection with the Registration. In giving such consent, we do not thereby
admit that we are within the category of persons whose consent is required under
Section 7 of the Securities Act of 1933, as amended.

                                                Very truly yours,

                                                /s/ Sherman & Sterling

                                Alexander's, Inc.
                             Park 80 West, Plaza II
                             Saddle Brook, NJ 07663

                                                                  April 28, 2000

Shearman & Sterling
599 Lexington Avenue
New York, New York 10022

Ladies and Gentlemen:

                  The undersigned officer of Alexander's, Inc. (the "Company")
hereby certifies on behalf of the Company that, after due inquiry, he has made
the representations set forth below and affirms as of the date hereof the
accuracy of such representations. The Company acknowledges and understands that
Shearman & Sterling will be relying upon the accuracy of this certificate and
these representations in (i) rendering an opinion regarding the election made by
the Company to be treated for federal income tax purposes as a real estate
investment trust (a "REIT") within the meaning of Section 856(a) of the Internal
Revenue Code of 1986, as amended (the "Code"), and (ii) allowing the Shearman &
Sterling name and opinion to be included by reference in the opinion letter
given by Sullivan & Cromwell in connection with the registration of 7,032,750
shares of common stock, par value $.04 per share, of Vornado Realty Trust on
April 28, 2000 on the Registration Statement on Form S-3 under the Securities
Act of 1933, as amended. In certain of these representations, the Company is
relying on representations furnished to it by Vornado Realty Trust.

                  1. The Company has operated, and will continue to operate, in
accordance with (i) its organizational document and (ii) the laws of the
jurisdiction in which it is organized.

                  2. The Company has been, and will continue to be, managed by a
board of directors.

                  3. Since January 1, 1995, the taxable year of the Company has
been the calendar year.

                  4. The Company has made a valid election to be taxed as a REIT
for its taxable year ended December 31, 1995, which election has not been, and
will not be, revoked or terminated.

                  5. For its taxable year ended December 31, 1995, the Company
had a deficit in earnings and profits (as defined in the Code) in excess of its
accumulated earnings and profits (if any) as of the close of its taxable year
ended December 31, 1994.

                  6. For each taxable year of the Company commencing with the
Company's taxable year ended December 31, 1995, at least 75 percent of the
Company's annual gross income has consisted, and will continue to consist, of
(i) "rents from real property" within the meaning of Section 856(d) of the Code,
(ii) interest on obligations secured by mortgages on real property or on
interests in real property, (iii) gain from the sale or other disposition of
real property (including interests in real property and interests in mortgages
on real property) which is not described in Section 1221(l) of the Code, or (iv)
amounts described in Sections 856(c)(3)(D) through 856(c)(3)(I) of the Code.(1)

                  7. For each taxable year of the Company commencing with the
Company's taxable year ended December 31, 1995, at least 95 percent of the
Company's annual gross income has consisted, and will continue to consist, of
(i) the items of income described in paragraph 6 hereof (other than those
described in Section 856(c)(3)(I) of the Code), (ii) gain realized from the sale
or other disposition of stock or securities which are not property described in
Section 1221(l) of the Code, (iii) interest, (iv) dividends and (v) income
derived from payments to the Company on interest rate swap or cap agreements,
options, futures contracts, forward rate agreements and other similar financial
instruments entered into to reduce the interest rate risks with respect to any
indebtedness incurred or to be incurred to acquire or carry real estate assets,
or gain from the sale or other disposition of such an investment.

                  8. Since January 1, 1995, the Company has not received or
accrued, and will not receive or accrue, any amount (herein "service
consideration"), directly or indirectly, with respect to any real or personal
property in any case in which the Company or any wholly- owned subsidiary of the
Company or any partnership or tenancy-in-common in which the Company has an
interest (or any agent of any of the foregoing) furnishes or renders services to
the tenants of such property, or manages or operates such property other than
(i) through an "independent contractor" with respect to the Company (within the
meaning of Section 856(d)(3) of the Code) from whom or which the Company or such
subsidiary, partnership or

- --------------

(1)  For purposes of these representations (i) all assets, liabilities and items
     of income, deduction and credit of a "qualified REIT subsidiary" (as such
     term is defined in Section 856(i) of the Code) of the Company are treated
     as assets, liabilities and such items of the Company and (ii) the Company
     is deemed to own its proportionate share (determined in accordance with
     Treasury Regulations 'SS' 1.856-3(g)) of each of the assets of each
     partnership or tenancy-in-common in which it holds an interest (including
     as a result of the operation of clause (i)) and is deemed to be entitled to
     the income of the partnership or tenancy-in-common attributable to such
     share.

tenancy-in-common, as the case may be, does not derive or receive any income;
(ii) services usually or customarily rendered in connection with the rental of
space for occupancy only within the meaning of Treasury Regulations Section
1.512(b)-l(c)(5), or not rendered primarily for the convenience of the occupant
of the real property, within the meaning of Treasury Regulations Section
1.512(b)-l(c)(5); or (iii) actions carried out by or on behalf of the directors
of the Company as a part of performing their fiduciary duty to manage the
Company, which need not be delegated or contracted out to independent
contractors, pursuant to Treasury Regulations Section 1.856-4(b)(5)(ii), except
that the Company may receive or accrue a de minimis amount of service
consideration which does not (a) cause any amount included in the Company's
gross income, other than such service consideration, to fail to qualify as
"rents from real property" under Section 856(d) of the Code or (b) materially
adversely affect the Company's ability to satisfy the standards relating to 75
percent and 95 percent of its gross income as set forth in paragraphs 6 and 7
hereof.

                  9. Since January 1, 1995, the Company has not received or
accrued, and will not receive or accrue, rent attributable to personal property
except with respect to a lease of real property where the average of the
adjusted bases of the personal property at the beginning and at the end of the
taxable year does not exceed 15 percent of the average of the aggregate adjusted
bases of the real property and the personal property leased under such lease at
the beginning and at the end of such taxable year within the meaning of Section
856(d)(1) of the Code.

                  10. Since January 1, 1995, the Company has not received or
accrued, and will not receive or accrue, directly or indirectly, any rent or
interest, where the determination of amount of rent or interest depends, in the
case of rent, on the income or profits of any person from the property, and, in
the case of interest, upon the income or profits of any person, except where
interest or rent is based on a fixed percentage or percentages of receipts or
sales within the meaning of Section 856(d)(2)(A) and Section 856(f)(1)(A) of the
Code, and except that the Company may receive or accrue a de minimis amount of
such rent or interest, provided that such amount does not materially adversely
affect the Company's ability to satisfy the standards relating to 75 percent and
95 percent of its gross income as set forth in paragraphs 6 and 7 hereof.

                  11. The Company will not receive or accrue (and since January
1, 1995, has not received or accrued) any amount from (i) any corporation in
which it owns (or since July 1, 1994, has owned) 10 percent or more of the total
combined voting power of all shares of stock entitled to vote or 10 percent or
more of the total number of shares of all classes of stock of such corporation,
or (ii) any unincorporated entity in which it owns (or since July 1, 1994, has
owned) an interest of 10 percent or more in the assets or net profits of such
person. For purposes of this assumption, ownership is determined in accordance
with section 856(d)(5) of the Code. Since January 1, 1995, the Company has
complied, and will continue to comply, with the recordkeeping and filing
requirements of Treasury Regulations Section 1.856-4(b)(4).

                  12. Since January 1, 1995, at the close of each quarter of the
Company's taxable year, at least 75 percent of the value of the Company's total
assets (as determined in accordance with Treasury Regulations Section
1.856-2(d)) has consisted, and will continue to consist, of real estate assets
within the meaning of Sections 856(c)(4) and 856(c)(5)(B) of the Code, cash and
cash items (including receivables which arise in the ordinary course of the
Company's operations, but not including receivables purchased from another
person), and Government securities.

                  13. Since January 1, 1995, at the close of each quarter of the
Company's taxable year, the Company has not beneficially owned, and will not
beneficially own, securities in any one issuer (except for any securities
qualifying as "real estate assets" within the meaning of section 856(c)(5)(B) of
the Code) having an aggregate value in excess of 5 percent of the Company's
total assets, as determined in accordance with Treasury Regulations Section
1.856-2(d).

                  14. Since January 1, 1995, at the close of each quarter of the
Company's taxable year, the Company has not beneficially owned, and will not
beneficially own, securities of any issuer (except for any securities qualifying
as "real estate assets" within the meaning of section 856(c)(5)(B) of the Code)
representing more than 10 percent of the outstanding voting securities of such
issuer.

                  15. The Company has requested and maintained, and will
continue to request and maintain, records concerning ownership of its
outstanding shares in accordance with section 857(f)(1) of the Code and Treasury
Regulations promulgated thereunder and predecessor requirements.

                  16. The Company has made, and will make, distributions to its
stockholders sufficient to meet the 95 percent distribution requirements of
section 857(a)(1) of the Code for the taxable year for which the REIT election
was made and every subsequent taxable year. In this connection, the Company has
complied with and will continue to comply with the distribution requirements
imposed by Notice 88-19 in respect of "built-in gains" recognized by the
Company.

                  17. Each distribution by the Company that is treated as a
dividend within the meaning of Section 316 of the Code will qualify for the
deduction for dividends paid under Section 561 of the Code, and without limiting
the foregoing, the Company will not make any distribution that constitutes a
preferential dividend as described in Section 562(c) of the Code.

                  18. At all times, the Company has beneficially held, and will
continue to beneficially hold, all of its assets for investment purposes and not
as (i) stock in trade or other property of a kind which would properly be
includible in inventory at hand at the close of a taxable year or (ii) property
held primarily for sale to customers in the ordinary course of the Company's
trade or business.

                  19. The Company has not held, and will not hold, a partnership
interest, unless such partnership is treated at all times for federal income tax
purposes as a partnership and not as an association taxable as a corporation
(including a publicly traded partnership that is treated as a corporation under
Section 7704 of the Code).

                  20. Since January 1, 1995, the outstanding shares of the
Company have been held by at least 100 or more persons, and such shares will
continue to be held by 100 or more persons.

                  21. Not more than 50 percent in value of the outstanding
shares of the Company have been or will be owned directly or indirectly,
actually or constructively (within the meaning of section 542(a)(2) of the Code,
as modified by section 856(h) of the Code), by five or fewer individuals (or
entities treated as individuals for purposes of section 856(h) of the Code)
during the second half of every taxable year following the taxable year ended
December 31, 1995.

                  22. In addition to those representations set forth in this
officer's certificate relating to the qualification of the Company as a REIT,
the Company has complied, and will continue to comply, with all other
requirements under the Code (including, without limitation, Sections 856 through
860 of the Code) in order to qualify as a REIT for each of the Company's taxable
years since January 1, 1995.

                  IN WITNESS WHEREOF, I have, on behalf of the Company, signed
this officers certificate as of this 28th day of April 2000.

                                     ALEXANDER'S INC.

                                     By:   /s/ Irwin Goldberg
                                           -----------------------------------
                                           Name:  Irwin Goldberg
                                           Title: Treasurer

EXHIBIT 23.4

                          INDEPENDENT AUDITORS' CONSENT

We consent to the incorporation by reference in this Registration Statement of
Vornado Realty Trust on Form S-3 of our report dated March 7, 2000, appearing in
the Annual Report on Form 10-K of Vornado Realty Trust for the year ended
December 31, 1999, and to the reference to us under the heading "Experts" in the
Prospectus, which is part of this Registration Statement.

/s/ Deloitte & Touche LLP
Parsippany, New Jersey
April 25, 2000

EXHIBIT 24

                                POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Irwin Goldberg his true and lawful
attorney-in-fact with power of substitution and re-substitution to sign in his
name, place and stead, in any and all capacities, to do any and all things and
execute any and all instruments that such attorney may deem necessary or
advisable under the Securities Act of 1933 (the "Securities Act"), and any
rules, regulations and requirements of the U.S. Securities and Exchange
Commission (the "Commission") in connection with the registration under the
Securities Act of the common shares of beneficial interest of the registrant,
including specifically, but without limiting the generality of the foregoing,
the power and authority to sign his name in his respective capacity as a member
of the board of trustees or officer of the registrant, this registration
statement on Form S-3 and/or such other form or forms as may be appropriate to
be filed with the Commission as any of them may deem appropriate in respect of
the common shares of beneficial interest of the registrant, to any and all
amendments thereto (including post-effective amendments) to this registration
statement, to any related Rule 462(b) registration statement and to any other
documents filed with the Commission, as fully for all intents and purposes as he
might or could do in person, and hereby ratifies and confirms all said
attorneys-in-fact and agents, each acting alone, and his substitutes, may
lawfully do or cause to be done by virtue hereof.

               SIGNATURE                                TITLE                                  DATE
               ---------                                -----                                  ----
                                                                                    
          /s/ Steven Roth                   Chairman of the Board of Trustees             April 28, 2000
- ---------------------------------------     (Principal Executive Officer)
              Steven Roth

     /s/ Michael D. Fascitelli              President and Trustee                         April 28, 2000
- ---------------------------------------
         Michael D. Fascitelli

        /s/ Irwin Goldberg                  Vice President-Chief Financial                April 28, 2000
- ---------------------------------------     Officer (Principal Financial and
            Irwin Goldberg                      Accounting Officer)

       /s/ David Mandelbuam                            Trustee                            April 28, 2000
- ---------------------------------------
           David Mandelbaum

         /s/ Stanley Simon                             Trustee                            April 28, 2000
- ---------------------------------------
             Stanley Simon

         /s/ Ronald Targan                             Trustee                            April 28, 2000
- ---------------------------------------
             Ronald Targan

         /s/ Richard West                              Trustee                            April 28, 2000
- ---------------------------------------
             Richard West

      /s/ Russell Wight, Jr.                           Trustee                            April 28, 2000
- ---------------------------------------
          Russell Wight, Jr.