SL GREEN REALTY CORP - Quarter Report: 2020 September (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________________________________________________________

FORM 10-Q

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

For the quarterly period ended September 30, 2020

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

For the transition period from to

Commission File Number: 1-13199 (SL Green Realty Corp.)

Commission File Number: 33-167793-02 (SL Green Operating Partnership, L.P.)

______________________________________________________________________

SL GREEN REALTY CORP.

SL GREEN OPERATING PARTNERSHIP, L.P.

(Exact name of registrant as specified in its charter)

______________________________________________________________________


SL Green Realty Corp.	Maryland	13-3956775
SL Green Operating Partnership, L.P.	Delaware	13-3960938
	(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

420 Lexington Avenue, New York, NY 10170

(Address of principal executive offices—Zip Code)

(212) 594-2700

(Registrant's telephone number, including area code)

______________________________________________________________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

SL Green Realty Corp. Yes x No o SL Green Operating Partnership, L.P. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

SL Green Realty Corp. Yes x No o SL Green Operating Partnership, L.P. Yes x No o

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

SL Green Realty Corp.

Large accelerated filer

Accelerated filer

☐

Non-accelerated filer

☐

Smaller Reporting Company

☐

Emerging Growth Company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

SL Green Operating Partnership, L.P.

Large accelerated filer

☐

Accelerated filer

☐

Non-accelerated filer

Smaller Reporting Company

☐

Emerging Growth Company

☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

SL Green Realty Corp. Yes ☐ No x SL Green Operating Partnership, L.P. Yes ☐ No x

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

Registrant

Trading Symbol

Title of Each Class

Name of Each Exchange on Which Registered

SL Green Realty Corp.

SLG

Common Stock, $0.01 par value

New York Stock Exchange

SL Green Realty Corp.

SLG.PRI

6.500% Series I Cumulative Redeemable Preferred Stock, $0.01 par value

New York Stock Exchange

As of November 4, 2020, 72,569,561 shares of SL Green Realty Corp.'s common stock, par value $0.01 per share, were outstanding. As of November 4, 2020, 1,025,366 common units of limited partnership interest of SL Green Operating Partnership, L.P. were held by non-affiliates. There is no established trading market for such units.

EXPLANATORY NOTE

This report combines the quarterly reports on Form 10-Q for the period ended September 30, 2020 of SL Green Realty Corp. and SL Green Operating Partnership, L.P. Unless stated otherwise or the context otherwise requires, references to "SL Green Realty Corp.," the "Company" or "SL Green" mean SL Green Realty Corp. and its consolidated subsidiaries, including SL Green Operating Partnership, L.P.; and references to "SL Green Operating Partnership, L.P.," the "Operating Partnership" or "SLGOP" mean SL Green Operating Partnership, L.P. and its consolidated subsidiaries. The terms "we," "our" and "us" mean the Company and all the entities owned or controlled by the Company, including the Operating Partnership.

The Company is a Maryland corporation which operates as a self-administered and self-managed real estate investment trust, or REIT, and is the sole managing general partner of the Operating Partnership. As a general partner of the Operating Partnership, the Company has full, exclusive and complete responsibility and discretion in the day-to-day management and control of the Operating Partnership.

As of September 30, 2020 the Company owns 94.77% of the outstanding general and limited partnership interest in the Operating Partnership and owns 9,200,000 Series I Preferred Units of the Operating Partnership. As of September 30, 2020, noncontrolling investors held, in aggregate, a 5.23% limited partnership interest in the Operating Partnership. We refer to these interests as the noncontrolling interests in the Operating Partnership.

The Company and the Operating Partnership are managed and operated as one entity. The financial results of the Operating Partnership are consolidated into the financial statements of the Company. The Company has no significant assets other than its investment in the Operating Partnership. Substantially all of our assets are held by, and our operations are conducted through, the Operating Partnership. Therefore, the assets and liabilities of the Company and the Operating Partnership are substantially the same.

Noncontrolling interests in the Operating Partnership, stockholders' equity of the Company and partners' capital of the Operating Partnership are the main areas of difference between the consolidated financial statements of the Company and those of the Operating Partnership. The common limited partnership interests in the Operating Partnership not owned by the Company are accounted as noncontrolling interests, within mezzanine equity, in the Company's and the Operating Partnership's consolidated financial statements.

We believe combining the quarterly reports on Form 10-Q of the Company and the Operating Partnership into this single report results in the following benefits:

•Combined reports enhance investors' understanding of the Company and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business;

•Combined reports eliminate duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the Company's disclosure applies to both the Company and the Operating Partnership; and

•Combined reports create time and cost efficiencies through the preparation of one combined report instead of two separate reports.

To help investors understand the significant differences between the Company and the Operating Partnership, this report presents the following separate sections for each of the Company and the Operating Partnership:

•consolidated financial statements;

•the following notes to the consolidated financial statements:

◦Note 11, Noncontrolling Interests on the Company’s Consolidated Financial Statements;

◦Note 12, Stockholders' Equity of the Company;

◦Note 13, Partners' Capital of the Operating Partnership.

This report also includes separate Part I, Item 4. Controls and Procedures sections and separate Exhibit 31 and 32 certifications for each of the Company and the Operating Partnership, respectively, in order to establish that the Chief Executive Officer and the Chief Financial Officer of the Company, in both their capacity as the principal executive officer and principal financial officer of the Company and the principal executive officer and principal financial officer of the general partner of the Operating Partnership, have made the requisite certifications and that the Company and the Operating Partnership are compliant with Rule 13a-15 and Rule 15d-15 of the Securities Exchange Act of 1934, as amended.

SL GREEN REALTY CORP. AND SL GREEN OPERATING PARTNERSHIP, L.P.

TABLE OF CONTENTS


PART I. FINANCIAL INFORMATION
Item 1.	FINANCIAL STATEMENTS	6

	FINANCIAL STATEMENTS OF SL GREEN REALTY CORP.
	Consolidated Balance Sheets as of September 30, 2020 (unaudited) and December 31, 2019	6
	Consolidated Statements of Operations for the three and nine months ended September 30, 2020 and 2019 (unaudited)	8
	Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2020 and 2019 (unaudited)	9
	Consolidated Statements of Equity for the three and nine months ended September 30, 2020 and 2019 (unaudited)	10
	Consolidated Statements of Cash Flows for the three and nine months ended September 30, 2020 and 2019 (unaudited)	12

	FINANCIAL STATEMENTS OF SL GREEN OPERATING PARTNERSHIP, L.P.
	Consolidated Balance Sheets as of September 30, 2020 (unaudited) and December 31, 2019	15
	Consolidated Statements of Operations for the three and nine months ended September 30, 2020 and 2019 (unaudited)	17
	Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2020 and 2019 (unaudited)	18
	Consolidated Statements of Capital for the three and nine months ended September 30, 2020 and 2019 (unaudited)	19
	Consolidated Statements of Cash Flows for the three and nine months ended September 30, 2020 and 2019 (unaudited)	21
	Notes to Consolidated Financial Statements (unaudited)	23
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	60
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	75
Item 4.	Controls and Procedures (SL Green Realty Corp. and SL Green Operating Partnership, L.P.)	76
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	77
Item 1A.	Risk Factors	77
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	78
Item 3.	Defaults Upon Senior Securities	79
Item 4.	Mine Safety Disclosures	80
Item 5.	Other Information	81
Item 6.	Exhibits	82
	Signatures	83

Table of Contents

SL GREEN REALTY CORP. AND SL GREEN OPERATING PARTNERSHIP, L.P.

PART I FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Table of Contents

SL Green Realty Corp.

Consolidated Balance Sheets

(in thousands)


	September 30, 2020		December 31, 2019
	(unaudited)
Assets
Commercial real estate properties, at cost:
Land and land interests	$	1,639,118	$	1,751,544
Building and improvements	5,483,155		5,154,990
Building leasehold and improvements	1,442,251		1,433,793
Right of use asset - financing leases	75,711		47,445
Right of use asset - operating leases	381,255		396,795
	9,021,490		8,784,567
Less: accumulated depreciation	(2,260,247)		(2,060,560)
	6,761,243		6,724,007
Assets held for sale	—		391,664
Cash and cash equivalents	221,404		166,070
Restricted cash	83,045		75,360
Investments in marketable securities	27,734		29,887
Tenant and other receivables	72,806		43,968
Related party receivables	31,936		21,121
Deferred rents receivable	304,673		283,011
Debt and preferred equity investments, net of discounts and deferred origination fees of $12,031 and $14,562 and allowances of $19,010 and $1,750 in 2020 and 2019, respectively	1,153,363		1,580,306
Investments in unconsolidated joint ventures	2,946,673		2,912,842
Deferred costs, net	206,289		205,283
Other assets	514,873		332,801
Total assets (1)	$	12,324,039	$	12,766,320
Liabilities
Mortgages and other loans payable, net	$	2,391,744	$	2,183,253
Revolving credit facility, net	184,840		234,013
Unsecured term loans, net	1,494,793		1,494,024
Unsecured notes, net	1,247,795		1,496,847
Accrued interest payable	23,438		22,148
Other liabilities	306,077		177,080
Accounts payable and accrued expenses	152,983		166,905
Deferred revenue	117,615		114,052
Lease liability - financing leases	174,983		44,448
Lease liability - operating leases	358,419		381,671
Dividend and distributions payable	25,486		79,282
Security deposits	56,212		62,252
Liabilities related to assets held for sale	—		—
Junior subordinated deferrable interest debentures held by trusts that issued trust preferred securities	100,000		100,000
Total liabilities (1)	6,634,385		6,555,975

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SL Green Realty Corp.

Consolidated Balance Sheets

(in thousands)


	September 30, 2020		December 31, 2019
	(unaudited)
Commitments and contingencies
Noncontrolling interests in Operating Partnership	353,480		409,862
Preferred units	202,169		283,285

Equity
SL Green stockholders' equity:
Series I Preferred Stock, $0.01 par value, $25.00 liquidation preference, 9,200 issued and outstanding at both September 30, 2020 and December 31, 2019	221,932		221,932
Common stock, $0.01 par value, 160,000 shares authorized and 74,095 and 80,257 issued and outstanding at September 30, 2020 and December 31, 2019, respectively (including 1,055 and 1,055 shares held in treasury at September 30, 2020 and December 31, 2019, respectively)	741		803
Additional paid-in-capital	3,998,516		4,286,395
Treasury stock at cost	(124,049)		(124,049)
Accumulated other comprehensive loss	(76,200)		(28,485)
Retained earnings	1,035,172		1,084,719
Total SL Green stockholders' equity	5,056,112		5,441,315
Noncontrolling interests in other partnerships	77,893		75,883
Total equity	5,134,005		5,517,198
Total liabilities and equity	$	12,324,039	$	12,766,320

(1) The Company's consolidated balance sheets include assets and liabilities of consolidated variable interest entities ("VIEs"). See Note 2. The consolidated balance sheets include the following amounts related to our consolidated VIEs, excluding the Operating Partnership: $375.9 million and $205.2 million of land, $1.4 billion and $481.9 million of building and improvements, $2.0 million and $2.0 million of building and leasehold improvements, $61.7 million and $61.7 million of right of use assets, $296.3 million and $17.6 million of accumulated depreciation, $322.8 million and $169.5 million of other assets included in other line items, $510.7 million and $457.1 million of real estate debt, net, $1.1 million and $1.2 million of accrued interest payable, $58.4 million and $57.7 million of lease liabilities, and $48.9 million and $43.7 million of other liabilities included in other line items as of September 30, 2020 and December 31, 2019, respectively.

The accompanying notes are an integral part of these consolidated financial statements.

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SL Green Realty Corp.

Consolidated Statements of Operations

(unaudited, in thousands, except per share data)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Revenues
Rental revenue, net	$	195,515	$	248,028	$	614,032	$	733,105
Investment income	22,988		51,518		101,464		153,167
Other income	31,341		14,088		102,350		44,641
Total revenues	249,844		313,634		817,846		930,913
Expenses
Operating expenses, including related party expenses of $2,801 and $9,289 in 2020 and $5,460 and $13,575 in 2019	45,910		59,847		140,673		175,862
Real estate taxes	43,522		49,626		131,805		143,008
Operating lease rent	6,973		8,295		22,171		24,891
Interest expense, net of interest income	23,536		48,112		91,100		145,797
Amortization of deferred financing costs	3,151		3,112		8,312		8,566
Depreciation and amortization	92,516		70,464		256,736		208,268
Loan loss and other investment reserves, net of recoveries	8,957		—		27,018		—
Transaction related costs	45		44		483		360
Marketing, general and administrative	23,602		23,841		66,682		75,300
Total expenses	248,212		263,341		744,980		782,052

Equity in net loss from unconsolidated joint ventures	(432)		(9,864)		(15,445)		(22,644)
Equity in net gain on sale of interest in unconsolidated joint venture/real estate	—		—		—		76,181
Purchase price and other fair value adjustments	—		3,799		—		69,389
Gain on sale of real estate, net	26,104		3,541		163,624		2,492
Depreciable real estate reserves and impairment	(6,627)		(7,047)		(6,627)		(7,047)





Net income	20,677		40,722		214,418		267,232
Net (income) loss attributable to noncontrolling interests:
Noncontrolling interests in the Operating Partnership	(802)		(1,719)		(10,073)		(12,306)
Noncontrolling interests in other partnerships	(414)		624		(1,145)		2,524
Preferred units distributions	(1,864)		(2,732)		(6,883)		(8,185)
Net income attributable to SL Green	17,597		36,895		196,317		249,265
Perpetual preferred stock dividends	(3,738)		(3,738)		(11,213)		(11,213)
Net income attributable to SL Green common stockholders	$	13,859	$	33,157	$	185,104	$	238,052






















Basic earnings per share	$	0.19	$	0.40	$	2.44	$	2.87










Diluted earnings per share	$	0.19	$	0.40	$	2.44	$	2.87

Basic weighted average common shares outstanding	73,020		82,292		75,521		82,855
Diluted weighted average common shares and common share equivalents outstanding	77,491		86,714		80,085		87,309

The accompanying notes are an integral part of these consolidated financial statements.

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SL Green Realty Corp.

Consolidated Statements of Comprehensive Income

(unaudited, in thousands)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Net income	$	20,677	$	40,722	$	214,418	$	267,232
Other comprehensive income (loss):
Increase (decrease) in unrealized value of derivative instruments, including SL Green's share of joint venture derivative instruments	6,099		(12,574)		(48,227)		(59,680)
Increase (decrease) in unrealized value of marketable securities	389		230		(2,152)		1,571
Other comprehensive income (loss)	6,488		(12,344)		(50,379)		(58,109)
Comprehensive income	27,165		28,378		164,039		209,123
Net income attributable to noncontrolling interests and preferred units distributions	(3,080)		(3,827)		(18,101)		(17,967)
Other comprehensive (income) loss attributable to noncontrolling interests	(317)		607		2,664		2,869
Comprehensive income attributable to SL Green	$	23,768	$	25,158	$	148,602	$	194,025

The accompanying notes are an integral part of these consolidated financial statements.

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SL Green Realty Corp.

Consolidated Statements of Equity

(unaudited, in thousands, except per share data)


	SL Green Realty Corp. Stockholders
				Common Stock
		Series I Preferred Stock		Shares	Par Value		Additional Paid- In-Capital		Treasury Stock		Accumulated Other Comprehensive Loss		Retained Earnings		Noncontrolling Interests		Total
Balance at December 31, 2019		$	221,932	79,202	$	803	$	4,286,395	$	(124,049)	$	(28,485)	$	1,084,719	$	75,883	$	5,517,198
Cumulative adjustment upon adoption of ASC 326													(39,184)				(39,184)
Balance at January 1, 2020		$	221,932	79,202	$	803	$	4,286,395	$	(124,049)	$	(28,485)	$	1,045,535	$	75,883	$	5,478,014
Net income (loss)													178,720		731		179,451
Acquisition of subsidiary interest from noncontrolling interest							(3,123)								1,587		(1,536)
Other comprehensive loss											(53,886)						(53,886)
Preferred dividends													(7,475)				(7,475)
DRSPP proceeds				6			364										364
Conversion of units in the Operating Partnership for common stock				101	1		8,743										8,744
Reallocation of noncontrolling interest in the Operating Partnership													31,144				31,144

Deferred compensation plan and stock awards, net of forfeitures and tax withholdings				(33)			13,493										13,493


Repurchases of common stock				(5,601)	(56)		(283,981)						(76,831)				(360,868)

Contributions to consolidated joint venture interests															8,185		8,185

Cash distributions to noncontrolling interests															(596)		(596)
Cash distributions declared ($1.180 per common share, none of which represented a return of capital for federal income tax purposes)													(89,272)				(89,272)
Balance at June 30, 2020		$	221,932	73,675	$	748	$	4,021,891	$	(124,049)	$	(82,371)	$	1,081,821	$	85,790	$	5,205,762
Net income													17,597		414		18,011
Acquisition of subsidiary interest from noncontrolling interest							—								—		—
Other comprehensive income											6,171						6,171
Preferred dividends													(3,738)				(3,738)
DRSPP proceeds				4			202										202
Conversion of units in the Operating Partnership for common stock				—	—		—										—
Reallocation of noncontrolling interest in the Operating Partnership													4,109				4,109

Deferred compensation plan and stock awards, net of forfeitures and tax withholdings				3	—		7,543										7,543


Repurchases of common stock				(642)	(7)		(31,120)						—				(31,127)

Contributions to consolidated joint venture interests															4,219		4,219

Cash distributions to noncontrolling interests															(12,530)		(12,530)
Cash distributions declared ($0.885 per common share, none of which represented a return of capital for federal income tax purposes)													(64,617)				(64,617)
Balance at September 30, 2020		$	221,932	73,040	$	741	$	3,998,516	$	(124,049)	$	(76,200)	$	1,035,172	$	77,893	$	5,134,005

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SL Green Realty Corp.

Consolidated Statements of Equity

(unaudited, in thousands, except per share data)


	SL Green Realty Corp. Stockholders
				Common Stock
		Series I Preferred Stock		Shares	Par Value		Additional Paid- In-Capital		Treasury Stock		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Noncontrolling Interests		Total
Balance at December 31, 2018		$	221,932	83,684	$	847	$	4,508,685	$	(124,049)	$	15,108	$	1,278,998	$	46,334	$	5,947,855


Net income													212,370		(1,900)		210,470
Acquisition of subsidiary interest from noncontrolling interest							(515)								(25,276)		(25,791)
Other comprehensive loss											(43,503)						(43,503)
Preferred dividends													(7,475)				(7,475)
DRSPP proceeds				3			263										263
Conversion of units in the Operating Partnership for common stock				5			446										446
Reallocation of noncontrolling interest in the Operating Partnership													(14,028)				(14,028)

Deferred compensation plan and stock awards, net of forfeitures and tax withholdings				(17)			10,533										10,533


Repurchases of common stock				(1,265)	(12)		(68,203)						(41,098)				(109,313)

Contributions to consolidated joint venture interests															50,692		50,692

Cash distributions to noncontrolling interests															(271)		(271)
Cash distributions declared ($1.70 per common share, none of which represented a return of capital for federal income tax purposes)													(140,377)				(140,377)
Balance at June 30, 2019		$	221,932	82,410	$	835	$	4,451,209	$	(124,049)	$	(28,395)	$	1,288,390	$	69,579	$	5,879,501
Net income													36,895		(624)		36,271
Acquisition of subsidiary interest from noncontrolling interest							(54)										(54)
Other comprehensive loss											(11,737)						(11,737)
Preferred dividends													(3,738)				(3,738)
DRSPP proceeds							39										39
Conversion of units in the Operating Partnership for common stock							25										25
Reallocation of noncontrolling interest in the Operating Partnership													(1,481)				(1,481)

Deferred compensation plan and stock awards, net of forfeitures and tax withholdings				21			5,948										5,948


Repurchases of common stock				(916)	(9)		(49,500)						(25,022)				(74,531)

Contributions to consolidated joint venture interests															2,404		2,404

Cash distributions to noncontrolling interests															(207)		(207)
Cash distributions declared ($0.85 per common share, none of which represented a return of capital for federal income tax purposes)													(69,140)				(69,140)
Balance at September 30, 2019		$	221,932	81,515	$	826	$	4,407,667	$	(124,049)	$	(40,132)	$	1,225,904	$	71,152	$	5,763,300

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

SL Green Realty Corp.

Consolidated Statements of Cash Flows

(unaudited, in thousands, except per share data)


	Nine Months Ended September 30,
	2020		2019
Operating Activities
Net income	$	214,418	$	267,232
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	265,048		216,834
Equity in net loss from unconsolidated joint ventures	15,445		22,644
Distributions of cumulative earnings from unconsolidated joint ventures	576		648
Equity in net gain on sale of interest in unconsolidated joint venture interest/real estate	—		(76,181)
Purchase price and other fair value adjustments	—		(69,389)
Depreciable real estate reserves and impairment	6,627		7,047
Gain on sale of real estate, net	(163,624)		(2,492)
Loan loss reserves and other investment reserves, net of recoveries	27,018		—



Deferred rents receivable	(3,459)		(10,005)
Non-cash lease expense	9,735		10,255
Other non-cash adjustments	14,874		(11,766)
Changes in operating assets and liabilities:
Tenant and other receivables	(43,069)		(7,564)
Related party receivables	4,195		8,921
Deferred lease costs	(12,472)		(38,542)
Other assets	(55,301)		(47,139)
Accounts payable, accrued expenses, other liabilities and security deposits	43,256		18,737
Deferred revenue	13,206		18,255
Change in lease liability - operating leases	(8,530)		(8,062)
Net cash provided by operating activities	327,943		299,433
Investing Activities
Acquisitions of real estate property	(86,846)		(261,596)
Additions to land, buildings and improvements	(281,651)		(150,742)
Acquisition deposits and deferred purchase price	—		(228)
Investments in unconsolidated joint ventures	(39,724)		(114,050)
Distributions in excess of cumulative earnings from unconsolidated joint ventures	104,300		62,576
Net proceeds from disposition of real estate/joint venture interest	333,037		138,948


Other investments	(3,921)		(2,491)
Origination of debt and preferred equity investments	(353,797)		(555,951)
Repayments or redemption of debt and preferred equity investments	703,625		642,634
Net cash provided by (used in) investing activities	375,023		(240,900)

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SL Green Realty Corp.

Consolidated Statements of Cash Flows

(unaudited, in thousands, except per share data)


	Nine Months Ended September 30,
	2020		2019
Financing Activities
Proceeds from mortgages and other loans payable	1,128,775		699,072
Repayments of mortgages and other loans payable	(710,352)		(162,024)
Proceeds from revolving credit facility and senior unsecured notes	1,275,000		1,090,000
Repayments of revolving credit facility and senior unsecured notes	(1,575,000)		(1,255,000)
Proceeds from stock options exercised and DRSPP issuance	566		302

Repurchase of common stock	(381,992)		(175,005)
Redemption of preferred stock	(82,750)		(15,142)
Redemption of OP units	(18,913)		(15,918)
Distributions to noncontrolling interests in other partnerships	(13,126)		(478)
Contributions from noncontrolling interests in other partnerships	12,404		4,873
Acquisition of subsidiary interest from noncontrolling interest	(1,536)		(25,791)
Distributions to noncontrolling interests in the Operating Partnership	(8,857)		(10,993)
Dividends paid on common and preferred stock	(224,147)		(230,804)

Tax withholdings related to restricted share awards	(4,752)		(3,126)
Deferred loan costs	(34,687)		(21,068)
Principal payments of on financing lease liabilities	(580)		—
Net cash used in financing activities	(639,947)		(121,102)
Net increase (decrease) in cash, cash equivalents, and restricted cash	63,019		(62,569)
Cash, cash equivalents, and restricted cash at beginning of year	241,430		279,113
Cash, cash equivalents, and restricted cash at end of period	$	304,449	$	216,544





Supplemental Disclosure of Non-Cash Investing and Financing Activities:

Conversion of units in the Operating Partnership	$	8,744	$	471

Exchange of preferred equity investment for real estate or equity in joint venture	119,497		—
Exchange of debt investment for real estate or equity in joint venture	104,211		—

Issuance of preferred units relating to a real estate acquisition	—		1,000
Tenant improvements and capital expenditures payable	11,993		10,040
Fair value adjustment to noncontrolling interest in the Operating Partnership	35,253		15,509

Deconsolidation of a subsidiary	—		395
Deconsolidation of a subsidiary mortgage	5,593		—
Reversal of assets held for sale	391,664		—
Mortgages assumed in connection with sale of real estate	250,000		—
Seller financed purchases	100,000		—
Debt and preferred equity reserves	4,638		—
Transfer of assets related to assets held for sale	—		403,488

Removal of fully depreciated commercial real estate properties	7,906		6,602

Contribution to consolidated joint venture by noncontrolling interest	—		48,223
Share repurchase payable	10,003		8,839

Recognition of sales-type leases and related lease liabilities	114,974		—
Recognition of right of use assets and related lease liabilities	57,500		389,120

Table of Contents

SL Green Realty Corp.

Consolidated Statements of Cash Flows

(unaudited, in thousands, except per share data)

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows.


	Nine Months Ended September 30,
	2020		2019
Cash and cash equivalents	$	221,404	$	121,751
Restricted cash	83,045		94,793
Total cash, cash equivalents, and restricted cash	$	304,449	$	216,544

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Balance Sheets

(in thousands)


	September 30, 2020		December 31, 2019
	(unaudited)
Assets
Commercial real estate properties, at cost:
Land and land interests	$	1,639,118	$	1,751,544
Building and improvements	5,483,155		5,154,990
Building leasehold and improvements	1,442,251		1,433,793
Right of use asset - financing leases	75,711		47,445
Right of use asset - operating leases	381,255		396,795
	9,021,490		8,784,567
Less: accumulated depreciation	(2,260,247)		(2,060,560)
	6,761,243		6,724,007
Assets held for sale	—		391,664
Cash and cash equivalents	221,404		166,070
Restricted cash	83,045		75,360
Investments in marketable securities	27,734		29,887
Tenant and other receivables	72,806		43,968
Related party receivables	31,936		21,121
Deferred rents receivable	304,673		283,011
Debt and preferred equity investments, net of discounts and deferred origination fees of $12,031 and $14,562 and allowances of $19,010 and $1,750 in 2020 and 2019, respectively	1,153,363		1,580,306
Investments in unconsolidated joint ventures	2,946,673		2,912,842
Deferred costs, net	206,289		205,283
Other assets	514,873		332,801
Total assets (1)	$	12,324,039	$	12,766,320
Liabilities
Mortgages and other loans payable, net	$	2,391,744	$	2,183,253
Revolving credit facility, net	184,840		234,013
Unsecured term loans, net	1,494,793		1,494,024
Unsecured notes, net	1,247,795		1,496,847
Accrued interest payable	23,438		22,148
Other liabilities	306,077		177,080
Accounts payable and accrued expenses	152,983		166,905
Deferred revenue	117,615		114,052
Lease liability - financing leases	174,983		44,448
Lease liability - operating leases	358,419		381,671
Dividend and distributions payable	25,486		79,282
Security deposits	56,212		62,252
Liabilities related to assets held for sale	—		—
Junior subordinated deferrable interest debentures held by trusts that issued trust preferred securities	100,000		100,000
Total liabilities (1)	6,634,385		6,555,975
Commitments and contingencies
Limited partner interests in SLGOP (4,027 and 4,196 limited partner common units outstanding at September 30, 2020 and December 31, 2019, respectively)	353,480		409,862
Preferred units	202,169		283,285

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Balance Sheets

(in thousands)


	September 30, 2020		December 31, 2019
	(unaudited)
Capital
SLGOP partners' capital:
Series I Preferred Units, $25.00 liquidation preference, 9,200 issued and outstanding at both September 30, 2020 and December 31, 2019	221,932		221,932
SL Green partners' capital (771 and 834 general partner common units and 72,269 and 78,368 limited partner common units outstanding at September 30, 2020 and December 31, 2019, respectively)	4,910,380		5,247,868
Accumulated other comprehensive loss	(76,200)		(28,485)
Total SLGOP partners' capital	5,056,112		5,441,315
Noncontrolling interests in other partnerships	77,893		75,883
Total capital	5,134,005		5,517,198
Total liabilities and capital	$	12,324,039	$	12,766,320

(1) The Operating Partnership's consolidated balance sheets include assets and liabilities of consolidated variable interest entities ("VIEs"). See Note 2. The consolidated balance sheets include the following amounts related to our consolidated VIEs, excluding the Operating Partnership: 375.9 million and $205.2 million of land, $1.4 billion and $481.9 million of building and improvements, $2.0 million and $2.0 million of building and leasehold improvements, $61.7 million and $61.7 million of right of use assets, $296.3 million and $17.6 million of accumulated depreciation, $322.8 million and $169.5 million of other assets included in other line items, $510.7 million and $457.1 million of real estate debt, net, $1.1 million and $1.2 million of accrued interest payable, $58.4 million and $57.7 million of lease liabilities, and $48.9 million and $43.7 million of other liabilities included in other line items as of September 30, 2020 and December 31, 2019, respectively.

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Statements of Operations

(unaudited, in thousands, except per unit data)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Revenues
Rental revenue, net	$	195,515	$	248,028	$	614,032	$	733,105

Investment income	22,988		51,518		101,464		153,167
Other income	31,341		14,088		102,350		44,641
Total revenues	249,844		313,634		817,846		930,913
Expenses
Operating expenses, including related party expenses of $2,801 and $9,289 in 2020 and $5,460 and $13,575 in 2019	45,910		59,847		140,673		175,862
Real estate taxes	43,522		49,626		131,805		143,008
Operating lease rent	6,973		8,295		22,171		24,891
Interest expense, net of interest income	23,536		48,112		91,100		145,797
Amortization of deferred financing costs	3,151		3,112		8,312		8,566
Depreciation and amortization	92,516		70,464		256,736		208,268
Loan loss and other investment reserves, net of recoveries	8,957		—		27,018		—
Transaction related costs	45		44		483		360
Marketing, general and administrative	23,602		23,841		66,682		75,300
Total expenses	248,212		263,341		744,980		782,052


Equity in net loss from unconsolidated joint ventures	(432)		(9,864)		(15,445)		(22,644)
Equity in net gain on sale of interest in unconsolidated joint venture/real estate	—		—		—		76,181
Purchase price and other fair value adjustments	—		3,799		—		69,389
Gain on sale of real estate, net	26,104		3,541		163,624		2,492
Depreciable real estate reserves and impairment	(6,627)		(7,047)		(6,627)		(7,047)





Net income	20,677		40,722		214,418		267,232
Net loss (income) attributable to noncontrolling interests:
Noncontrolling interests in other partnerships	(414)		624		(1,145)		2,524
Preferred units distributions	(1,864)		(2,732)		(6,883)		(8,185)
Net income attributable to SLGOP	18,399		38,614		206,390		261,571
Perpetual preferred unit distributions	(3,738)		(3,738)		(11,213)		(11,213)
Net income attributable to SLGOP common unitholders	$	14,661	$	34,876	$	195,177	$	250,358






















Basic earnings per unit	$	0.19	$	0.40	$	2.44	$	2.87










Diluted earnings per unit	$	0.19	$	0.40	$	2.44	$	2.87

Basic weighted average common units outstanding	77,049		86,550		79,644		87,138
Diluted weighted average common units and common unit equivalents outstanding	77,491		86,714		80,085		87,309

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Statements of Comprehensive Income

(unaudited, in thousands)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Net income	$	20,677	$	40,722	$	214,418	$	267,232
Other comprehensive income (loss):
Increase (decrease) in unrealized value of derivative instruments, including SLGOP's share of joint venture derivative instruments	6,099		(12,574)		(48,227)		(59,680)
Increase (decrease) in unrealized value of marketable securities	389		230		(2,152)		1,571
Other comprehensive income (loss)	6,488		(12,344)		(50,379)		(58,109)
Comprehensive income	27,165		28,378		164,039		209,123
Net (income) loss attributable to noncontrolling interests	(414)		624		(1,145)		2,524
Other comprehensive (income) loss attributable to noncontrolling interests	(317)		607		2,664		2,869
Comprehensive income attributable to SLGOP	$	26,434	$	29,609	$	165,558	$	214,516

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Statements of Capital

(unaudited, in thousands, except per unit data)


	SL Green Operating Partnership Unitholders
			Partners' Interest
	Series I Preferred Units		Common Units	Common Unitholders		Accumulated Other Comprehensive Income (Loss)		Noncontrolling Interests		Total
Balance at December 31, 2019	$	221,932	79,202	$	5,247,868	$	(28,485)	$	75,883	$	5,517,198
Cumulative adjustment upon adoption of ASC 326				(39,184)						(39,184)
Balance at January 1, 2020	$	221,932	79,202	$	5,208,684	$	(28,485)	$	75,883	$	5,478,014
Net income (loss)				178,720				731		179,451
Acquisition of subsidiary interest from noncontrolling interest				(3,123)				1,587		(1,536)
Other comprehensive loss						(53,886)				(53,886)
Preferred distributions				(7,475)						(7,475)
DRSPP proceeds			6	364						364
Conversion of common units			101	8,744						8,744
Reallocation of noncontrolling interests in the operating partnership				31,144						31,144

Deferred compensation plan and stock awards, net of forfeitures and tax withholdings			(33)	13,493						13,493


Repurchases of common stock			(5,601)	(360,868)						(360,868)
Contribution to consolidated joint venture interests								8,185		8,185


Cash distributions to noncontrolling interests								(596)		(596)
Cash distributions declared ($1.180 per common unit, none of which represented a return of capital for federal income tax purposes)				(89,272)						(89,272)
Balance at June 30, 2020	$	221,932	73,675	$	4,980,411	$	(82,371)	$	85,790	$	5,205,762
Net income				17,597				414		18,011
Acquisition of subsidiary interest from noncontrolling interest				—				—		—
Other comprehensive income						6,171				6,171
Preferred distributions				(3,738)						(3,738)
DRSPP proceeds			4	202						202
Conversion of common units			—	—						—
Reallocation of noncontrolling interests in the operating partnership				4,109						4,109

Deferred compensation plan and stock awards, net of forfeitures and tax withholdings			3	7,543						7,543


Repurchases of common stock			(642)	(31,127)						(31,127)
Contribution to consolidated joint venture interests								4,219		4,219


Cash distributions to noncontrolling interests								(12,530)		(12,530)
Cash distributions declared ($0.885 per common unit, none of which represented a return of capital for federal income tax purposes)				(64,617)						(64,617)
Balance at September 30, 2020	$	221,932	73,040	$	4,910,380	$	(76,200)	$	77,893	$	5,134,005

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Statements of Capital

(unaudited, in thousands, except per unit data)


	SL Green Operating Partnership Unitholders
			Partners' Interest
	Series I Preferred Units		Common Units	Common Unitholders		Accumulated Other Comprehensive Loss		Noncontrolling Interests		Total
Balance at December 31, 2018	$	221,932	83,684	$	5,664,481	$	15,108	$	46,334	$	5,947,855


Net income				212,370				(1,900)		210,470
Acquisition of subsidiary interest from noncontrolling interest				(515)				(25,276)		(25,791)
Other comprehensive income						(43,503)				(43,503)
Preferred distributions				(7,475)						(7,475)
DRSPP proceeds			3	263						263
Conversion of common units			5	446						446
Reallocation of noncontrolling interests in the operating partnership				(14,028)						(14,028)

Deferred compensation plan and stock awards, net of forfeitures and tax withholdings			(17)	10,533						10,533


Repurchases of common stock			(1,265)	(109,313)						(109,313)
Contribution to consolidated joint venture interests								50,692		50,692


Cash distributions to noncontrolling interests								(271)		(271)
Cash distributions declared ($1.70 per common unit, none of which represented a return of capital for federal income tax purposes)				(140,377)						(140,377)
Balance at June 30, 2019	$	221,932	82,410	$	5,616,385	$	(28,395)	$	69,579	$	5,879,501
Net income				36,895				(624)		36,271
Acquisition of subsidiary interest from noncontrolling interest				(54)						(54)
Other comprehensive income						(11,737)				(11,737)
Preferred distributions				(3,738)						(3,738)
DRSPP proceeds			—	39						39
Conversion of common units			—	25						25
Reallocation of noncontrolling interests in the operating partnership				(1,481)						(1,481)

Deferred compensation plan and stock awards, net of forfeitures and tax withholdings			21	5,948						5,948


Repurchases of common stock			(916)	(74,531)						(74,531)
Contribution to consolidated joint venture interests								2,404		2,404


Cash distributions to noncontrolling interests								(207)		(207)
Cash distributions declared ($0.85 per common unit, none of which represented a return of capital for federal income tax purposes)				(69,140)						(69,140)
Balance at September 30, 2019	$	221,932	81,515	$	5,510,348	$	(40,132)	$	71,152	$	5,763,300

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Statements of Cash Flows

(unaudited, in thousands)


	Nine Months Ended September 30,
	2020		2019
Operating Activities
Net income	$	214,418	$	267,232
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	265,048		216,834
Equity in net loss from unconsolidated joint ventures	15,445		22,644
Distributions of cumulative earnings from unconsolidated joint ventures	576		648
Equity in net gain on sale of interest in unconsolidated joint venture interest/real estate	—		(76,181)
Purchase price and other fair value adjustments	—		(69,389)
Depreciable real estate reserves and impairment	6,627		7,047
Gain on sale of real estate, net	(163,624)		(2,492)
Loan loss reserves and other investment reserves, net of recoveries	27,018		—



Deferred rents receivable	(3,459)		(10,005)
Non-cash lease expense	9,735		10,255
Other non-cash adjustments	14,874		(11,766)
Changes in operating assets and liabilities:
Tenant and other receivables	(43,069)		(7,564)
Related party receivables	4,195		8,921
Deferred lease costs	(12,472)		(38,542)
Other assets	(55,301)		(47,139)
Accounts payable, accrued expenses, other liabilities and security deposits	43,256		18,737
Deferred revenue	13,206		18,255
Change in lease liability - operating leases	(8,530)		(8,062)
Net cash provided by operating activities	327,943		299,433
Investing Activities
Acquisitions of real estate property	(86,846)		(261,596)
Additions to land, buildings and improvements	(281,651)		(150,742)
Acquisition deposits and deferred purchase price	—		(228)
Investments in unconsolidated joint ventures	(39,724)		(114,050)
Distributions in excess of cumulative earnings from unconsolidated joint ventures	104,300		62,576
Net proceeds from disposition of real estate/joint venture interest	333,037		138,948


Other investments	(3,921)		(2,491)
Origination of debt and preferred equity investments	(353,797)		(555,951)
Repayments or redemption of debt and preferred equity investments	703,625		642,634
Net cash provided by (used in) investing activities	375,023		(240,900)

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Statements of Cash Flows

(unaudited, in thousands)


	Nine Months Ended September 30,
	2020		2019
Financing Activities
Proceeds from mortgages and other loans payable	1,128,775		699,072
Repayments of mortgages and other loans payable	(710,352)		(162,024)
Proceeds from revolving credit facility and senior unsecured notes	1,275,000		1,090,000
Repayments of revolving credit facility and senior unsecured notes	(1,575,000)		(1,255,000)
Proceeds from stock options exercised and DRSPP issuance	566		302

Repurchase of common units	(381,992)		(175,005)
Redemption of preferred units	(82,750)		(15,142)
Redemption of OP units	(18,913)		(15,918)
Distributions to noncontrolling interests in other partnerships	(13,126)		(478)
Contributions from noncontrolling interests in other partnerships	12,404		4,873
Acquisition of subsidiary interest from noncontrolling interest	(1,536)		(25,791)
Distributions paid on common and preferred units	(233,004)		(241,797)

Tax withholdings related to restricted share awards	(4,752)		(3,126)
Deferred loan costs	(34,687)		(21,068)
Principal payments of on financing lease liabilities	(580)		—
Net cash used in financing activities	(639,947)		(121,102)
Net increase (decrease) in cash, cash equivalents, and restricted cash	63,019		(62,569)
Cash, cash equivalents, and restricted cash at beginning of year	241,430		279,113
Cash, cash equivalents, and restricted cash at end of period	$	304,449	$	216,544





Supplemental Disclosure of Non-Cash Investing and Financing Activities:

Conversion of units in the Operating Partnership	$	8,744	$	471

Exchange of preferred equity investment for real estate or equity in joint venture	119,497		—
Exchange of debt investment for real estate or equity in joint venture	104,211		—

Issuance of preferred units relating to a real estate acquisition	—		1,000
Tenant improvements and capital expenditures payable	11,993		10,040
Fair value adjustment to noncontrolling interest in the Operating Partnership	35,253		15,509

Deconsolidation of a subsidiary	—		395
Deconsolidation of a subsidiary mortgage	5,593		—
Reversal of assets held for sale	391,664		—
Mortgages assumed in connection with sale of real estate	250,000		—
Seller financed purchases	100,000		—
Debt and preferred equity reserves	4,638		—
Transfer of assets related to assets held for sale	—		403,488
Transfer of liabilities related to assets held for sale	—		—
Removal of fully depreciated commercial real estate properties	7,906		6,602

Contribution to consolidated joint venture by noncontrolling interest	—		48,223
Share repurchase payable	10,003		8,839

Recognition of sales-type leases and related lease liabilities	114,974		—
Recognition of right of use assets and related lease liabilities	57,500		389,120

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Statements of Cash Flows

(unaudited, in thousands)


	Nine Months Ended September 30,
	2020		2019
Cash and cash equivalents	$	221,404	$	121,751
Restricted cash	83,045		94,793
Total cash, cash equivalents, and restricted cash	$	304,449	$	216,544

The accompanying notes are an integral part of these consolidated financial statements.

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements

September 30, 2020

(unaudited)

1. Organization and Basis of Presentation

SL Green Realty Corp., which is referred to as the Company or SL Green, a Maryland corporation, and SL Green Operating Partnership, L.P., which is referred to as SLGOP or the Operating Partnership, a Delaware limited partnership, were formed in June 1997 for the purpose of combining the commercial real estate business of S.L. Green Properties, Inc. and its affiliated partnerships and entities. The Operating Partnership received a contribution of interest in the real estate properties, as well as 95% of the economic interest in the management, leasing and construction companies which are referred to as the Service Corporation. All of the management, leasing and construction services that are provided to the properties that are wholly-owned by us and that are provided to certain joint ventures are conducted through SL Green Management LLC which is 100% owned by the Operating Partnership. The Company has qualified, and expects to qualify in the current fiscal year, as a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended, or the Code, and operates as a self-administered, self-managed REIT. A REIT is a legal entity that holds real estate interests and, through payments of dividends to stockholders, is permitted to minimize the payment of Federal income taxes at the corporate level. Unless the context requires otherwise, all references to "we," "our" and "us" means the Company and all entities owned or controlled by the Company, including the Operating Partnership.

Substantially all of our assets are held by, and all of our operations are conducted through, the Operating Partnership. The Company is the sole managing general partner of the Operating Partnership. As of September 30, 2020, noncontrolling investors held, in the aggregate, a 5.23% limited partnership interest in the Operating Partnership. We refer to these interests as the noncontrolling interests in the Operating Partnership. The Operating Partnership is considered a variable interest entity, or VIE, in which we are the primary beneficiary. See Note 11, "Noncontrolling Interests on the Company's Consolidated Financial Statements."

As of September 30, 2020, we owned the following interests in properties in the New York metropolitan area, primarily in midtown Manhattan. Our investments located outside of Manhattan are referred to as the Suburban properties:


		Consolidated		Unconsolidated		Total
Location	Property Type	Number of Properties	Approximate Square Feet (unaudited)	Number of Properties	Approximate Square Feet (unaudited)	Number of Properties	Approximate Square Feet (unaudited)	Weighted Average Occupancy(1) (unaudited)
Commercial:
Manhattan	Office	18	10,647,191	11	11,841,483	29	22,488,674	93.1	%
	Retail	4	44,189	8	289,050	12	333,239	94.0	%
	Development/Redevelopment	10	2,908,362	2	1,755,610	12	4,663,972	N/A
	Fee Interest	—	—	1	—	1	—	—	%
		32	13,599,742	22	13,886,143	54	27,485,885	93.1	%
Suburban	Office	8	1,044,800	—	—	8	1,044,800	85.0	%
	Retail	1	52,000	—	—	1	52,000	100.0	%

		9	1,096,800	—	—	9	1,096,800	85.7	%
Total commercial properties		41	14,696,542	22	13,886,143	63	28,582,685	92.7	%
Residential:
Manhattan	Residential	1	82,250	8	1,663,774	9	1,746,024	78.8	%
Total residential properties		1	82,250	8	1,663,774	9	1,746,024	78.8	%
Total portfolio		42	14,778,792	30	15,549,917	72	30,328,709	91.9	%

(1)The weighted average occupancy for commercial properties represents the total occupied square footage divided by the total square footage at acquisition. The weighted average occupancy for residential properties represents the total occupied units divided by the total available units.

As of September 30, 2020, we also managed two office buildings owned by third parties encompassing approximately 2.1 million square feet (unaudited), and held debt and preferred equity investments with a book value of $1.15 billion, excluding $0.1 billion of debt and preferred equity investments and other financing receivables that are included in balance sheet line items other than the Debt and Preferred Equity Investments line item.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

Partnership Agreement

In accordance with the partnership agreement of the Operating Partnership, or the Operating Partnership Agreement, we allocate all distributions and profits and losses in proportion to the percentage of ownership interests of the respective partners, subject to the priority distributions with respect to preferred units and special provisions that apply to LTIP Units. As the managing general partner of the Operating Partnership, we are required to take such reasonable efforts, as determined by us in our sole discretion, to cause the Operating Partnership to distribute sufficient amounts to enable the payment of sufficient dividends by us to minimize any Federal income or excise tax at the Company level. Under the Operating Partnership Agreement, each limited partner has the right to redeem units of limited partnership interests for cash, or if we so elect, shares of SL Green's common stock on a one-for-one basis.

Basis of Quarterly Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for the fair presentation of the financial position of the Company and the Operating Partnership at September 30, 2020 and the results of operations for the periods presented have been included. The operating results for the period presented are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. These financial statements should be read in conjunction with the financial statements and accompanying notes included in the Annual Report on Form 10-K for the year ended December 31, 2019 of the Company and the Operating Partnership.

The consolidated balance sheet at December 31, 2019 has been derived from the audited financial statements as of that date but does not include all the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements.

Subsequent Events

Beginning in late 2019, a novel strain of Coronavirus (“COVID-19”) began to spread throughout the world, including the United States, ultimately being declared a pandemic by the World Health Organization. The pandemic has caused, and continues to cause, severe disruptions with wide ranging impacts to the global economy and everyday life. We expect that our business, results of operations, liquidity, cash flows, prospects, and our ability to achieve forward-looking targets and expectations could be materially and adversely affected for at least the duration of the COVID-19 pandemic and possibly longer. This has and may continue to cause significant volatility in the trading prices of our securities. The extent of the impact of the COVID-19 pandemic will depend on future developments, including the duration, severity and spread of the pandemic, health and safety actions taken to contain its spread and how quickly and to what extent normal economic and operating conditions can resume. Additionally, the COVID-19 pandemic could increase the magnitude of many of the other risks described in our latest Annual Report on Form 10-K and other SEC filings and may have other adverse effects on our operations that we are not currently able to predict.

As of the date of this filing, we have collected gross tenant billings for the third quarter of 2020 of 92.7% overall, including 96.9% from office tenants and 70.2% from retail tenants. As of the date of this filing, we have collected gross tenant billings for the month of October 2020 of 93.0% overall, including 96.4% from office tenants and 72.6% from retail tenants.

In October 2020, the Company, together with its partners, entered into a contract to sell interests in 410 Tenth Avenue for gross consideration of $952.5 million. We currently own 70.9% of the venture. As part of the sale, the venture is retaining a 5% interest through completion of the property's redevelopment. This transaction is expected to close in the fourth quarter of 2020, subject to satisfaction of various closing conditions. At September 30, 2020, we determined that the held for sale criteria was not met for this property as it was not probable that the sale of the asset would be completed within one year.

2. Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include our accounts and those of our subsidiaries, which are wholly-owned or controlled by us. Entities which we do not control through our voting interest and entities which are variable interest entities, but where we are not the primary beneficiary, are accounted for under the equity method. See Note 5, "Debt and Preferred Equity Investments" and Note 6, "Investments in Unconsolidated Joint Ventures." All significant intercompany balances and transactions have been eliminated.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

We consolidate a VIE in which we are considered the primary beneficiary. The primary beneficiary is the entity that has (i) the power to direct the activities that most significantly impact the entity's economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could be significant to the VIE.

Investment in Commercial Real Estate Properties

We allocate the purchase price of real estate to land and building (inclusive of tenant improvements) and, if determined to be material, intangibles, such as the value of above- and below-market leases and origination costs associated with the in-place leases. We depreciate the amount allocated to building (inclusive of tenant improvements) over their estimated useful lives, which generally range from 3 years to 40 years. We amortize the amount allocated to the above- and below-market leases over the remaining term of the associated lease, which generally range from 1 year to 14 years, and record it as either an increase (in the case of below-market leases) or a decrease (in the case of above-market leases) to rental income. We amortize the amount allocated to the values associated with in-place leases over the expected term of the associated lease, which generally ranges from 1 year to 14 years. If a tenant vacates its space prior to the contractual termination of the lease and no rental payments are being made on the lease, any unamortized balance of the related intangible will be written off. The tenant improvements and origination costs are amortized as an expense over the remaining life of the lease (or charged against earnings if the lease is terminated prior to its contractual expiration date). We assess fair value of the leases based on estimated cash flow projections that utilize appropriate discount rates and available market information. Estimates of future cash flows are based on a number of factors including the historical operating results, known trends, and market/economic conditions that may affect the property. To the extent acquired leases contain fixed rate renewal options that are below-market and determined to be material, we amortize such below-market lease value into rental income over the renewal period.

The Company classifies those leases under which the Company is the lessee at lease commencement as finance or operating leases. Leases qualify as finance leases if the lease transfers ownership of the asset at the end of the lease term, the lease grants an option to purchase the asset that we are reasonably certain to exercise, the lease term is for a major part of the remaining economic life of the asset, or the present value of the lease payments exceeds substantially all of the fair value of the asset. Leases that do not qualify as finance leases are deemed to be operating leases. At lease commencement the Company records a lease liability which is measured as the present value of the lease payments and a right of use asset which is measured as the amount of the lease liability and any initial direct costs incurred. The Company applies a discount rate to determine the present value of the lease payments. If the rate implicit in the lease is known, the Company uses that rate. If the rate implicit in the lease is not known, the Company uses a discount rate reflective of the Company’s collateralized borrowing rate given the term of the lease. To determine the discount rate, the Company employs a third party specialist to develop an analysis based primarily on the observable borrowing rates of the Company, other REITs, and other corporate borrowers with long-term borrowings. On the consolidated statements of operations, operating leases are expensed through operating lease rent while financing leases are expensed through amortization and interest expense. On the consolidated balance sheet, financing leases include the amounts previously captioned "Properties under capital lease." When applicable, the Company combines the consideration for lease and non-lease components in the calculation of the value of the lease obligation and right-of-use asset.

On a periodic basis, we assess whether there are any indications that the value of our real estate properties may be impaired or that their carrying value may not be recoverable. A property's value is considered impaired if management's estimate of the aggregate future cash flows (undiscounted) to be generated by the property is less than the carrying value of the property. To the extent impairment has occurred, the loss will be measured as the excess of the carrying amount of the property over the fair value of the property as calculated in accordance with ASC 820. We also evaluate our real estate properties for impairment when a property has been classified as held for sale. Real estate assets held for sale are valued at the lower of their carrying value or fair value less costs to sell and depreciation expense is no longer recorded.

We recognized $1.6 million and $4.5 million of rental revenue for the three and nine months ended September 30, 2020, respectively, and $1.2 million and $3.6 million of rental revenue for the three and nine months ended September 30, 2019, respectively, for the amortization of aggregate below-market leases in excess of above-market leases.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

The following summarizes our identified intangible assets (acquired above-market leases and in-place leases) and intangible liabilities (acquired below-market leases) as of September 30, 2020 and December 31, 2019 (in thousands):


	September 30, 2020		December 31, 2019
Identified intangible assets (included in other assets):
Gross amount	$	224,221	$	255,198
Accumulated amortization	(208,135)		(228,223)
Net(1)	$	16,086	$	26,975
Identified intangible liabilities (included in deferred revenue):
Gross amount	$	273,240	$	282,048
Accumulated amortization	(255,879)		(249,514)
Net(1)	$	17,361	$	32,534

(1) As of September 30, 2020 and December 31, 2019, no net intangible assets and no net intangible liabilities were reclassified to assets held for sale or liabilities related to assets held for sale.

Fair Value Measurements

See Note 16, "Fair Value Measurements."

Investment in Marketable Securities

At acquisition, we designate a security as held-to-maturity, available-for-sale, or trading. As of September 30, 2020, we did not have any securities designated as held-to-maturity or trading. We account for our available-for-sale securities at fair value pursuant to Accounting Standards Codification, or ASC, 820-10, with the net unrealized gains or losses reported as a component of accumulated other comprehensive income or loss. The cost of marketable securities sold and the amount reclassified out of accumulated other comprehensive income into earnings is determined using the specific identification method. Any unrealized losses that are determined to be other-than-temporary are recognized in earnings up to their credit component.

At September 30, 2020 and December 31, 2019, we held the following marketable securities (in thousands):


	September 30, 2020		December 31, 2019

Commercial mortgage-backed securities	$	27,734	$	29,887
Total marketable securities available-for-sale	$	27,734	$	29,887

The cost basis of the commercial mortgage-backed securities was $27.5 million at both September 30, 2020 and December 31, 2019. These securities mature at various times through 2035. We held no equity marketable securities as of September 30, 2020 and December 31, 2019.

During the three and nine months ended September 30, 2020, we did not dispose of any marketable securities. During the three and nine months ended September 30, 2019, we did not dispose of any marketable securities.

Investments in Unconsolidated Joint Ventures

We assess our investments in unconsolidated joint ventures for recoverability and if it is determined that a loss in value of the investment is other than temporary, we write down the investment to its fair value. We evaluate our equity investments for impairment based on each joint venture's projected discounted cash flows. We do not believe that the values of any of our equity investments were impaired at September 30, 2020.

Deferred Lease Costs

Deferred lease costs consist of incremental fees and direct costs that would not have been incurred if the lease had not been obtained and are amortized on a straight-line basis over the related lease term.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

Lease Classification

Lease classification for leases under which the Company is the lessor is evaluated at lease commencement and leases not classified as sales-type leases or direct financing leases are classified as operating leases. Leases qualify as sales-type leases if the contract includes either transfer of ownership clauses, certain purchase options, a lease term representing a major part of the economic life of the asset, or the present value of the lease payments and residual guarantees provided by the lessee exceeds substantially all of the fair value of the asset. Additionally, leasing an asset so specialized that it is not deemed to have any value to the Company at the end of the lease term may also result in classification as a sales-type lease. Leases qualify as direct financing leases when the present value of the lease payments and residual value guarantees provided by the lessee and unrelated third parties exceeds substantially all of the fair value of the asset and collection of the payments is probable.

Revenue Recognition

Rental revenue for operating leases is recognized on a straight-line basis over the term of the lease. Rental revenue recognition commences when the leased space is available for use by the lessee.

To determine whether the leased space is available for use by the lessee, management evaluates whether we are or the tenant is the owner of tenant improvements for accounting purposes. When management concludes that we are the owner of tenant improvements, rental revenue recognition begins when the tenant takes possession of the finished space, which is when such tenant improvements are substantially complete. In certain instances, when management concludes that we are not the owner of tenant improvements, rental revenue recognition begins when the tenant takes possession of or controls the space.

When management concludes that we are the owner of tenant improvements for accounting purposes, we record amounts funded to construct the tenant improvements as a capital asset. For these tenant improvements, we record amounts reimbursed by tenants as a reduction of the capital asset. When management concludes that the tenant is the owner of tenant improvements for accounting purposes, we record our contribution towards those improvements as a lease incentive, which is included in deferred costs, net on our consolidated balance sheets and amortized as a reduction to rental revenue on a straight-line basis over the term of the lease.

The excess of rents recognized over amounts contractually due pursuant to the underlying leases are included in deferred rents receivable on the consolidated balance sheets.

In addition to base rent, our tenants also generally will pay variable rent which represents their pro rata share of increases in real estate taxes and certain operating expenses for the building over a base year. In some leases, in lieu of paying additional rent based upon increases in certain building operating expenses, the tenant will pay additional rent based upon increases in the wage rate paid to porters over the porters' wage rate in effect during a base year or increases in the consumer price index over the index value in effect during a base year. In addition, many of our leases contain fixed percentage increases over the base rent to cover escalations. Electricity is most often supplied by the landlord either on a sub-metered basis, or rent inclusion basis (i.e., a fixed fee is included in the rent for electricity, which amount may increase based upon increases in electricity rates or increases in electrical usage by the tenant). Base building services other than electricity (such as heat, air conditioning and freight elevator service during business hours, and base building cleaning) are typically provided at no additional cost, with the tenant paying additional rent only for services which exceed base building services or for services which are provided outside normal business hours. These escalations are based on actual expenses incurred in the prior calendar year. If the expenses in the current year are different from those in the prior year, then during the current year, the escalations will be adjusted to reflect the actual expenses for the current year.

Rental revenue is recognized if collectability is probable. If collectability of substantially all of the lease payments is assessed as not probable, any difference between the rental revenue recognized to date and the lease payments that have been collected is recognized as a current-period adjustment to rental revenue. A subsequent change in the assessment of collectability to probable may result in a current-period adjustment to rental revenue for any difference between the rental revenue that would have been recognized if collectability had always been assessed as probable and the rental revenue recognized to date.

We recognize lease concessions related to COVID-19 such as rent deferrals and abatements in accordance with the Lease Modification Q&A issued by the FASB in April 2020, which provides entities with the option to elect to account for lease concessions as though the enforceable rights and obligations existed in the original lease. This election is only available when total cash flows resulting from the modified lease are substantially similar to the cash flows in the original lease. When total cash flows resulting from the modified lease are not substantially similar to the cash flows in the original lease, we account for the concession agreement as a new lease.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

The Company provides its tenants with certain customary services for lease contracts such as common area maintenance and general security. We have elected to combine the non-lease components with the lease components of our operating lease agreements and account for them as a single lease component in accordance with ASC 842.

Tenant and other receivables at September 30, 2020 and December 31, 2019 is shown net of $9.5 million and $2.6 million, respectively, of reserves for recognized receivables. The Company may also have claims to contractual lease payments that were not recorded to income in instances where their collection was not probable.

We record a gain or loss on sale of real estate assets when we no longer hold a controlling financial interest in the entity holding the real estate, a contract exists with a third party and that third party has control of the assets acquired.

Investment income on debt and preferred equity investments is accrued based on the contractual terms of the instruments and when it is deemed collectible. Some debt and preferred equity investments provide for accrual of interest at specified rates, which differ from current payment terms. Interest is recognized on such loans at the accrual rate subject to management's determination that accrued interest is collectible. If management cannot make this determination, interest income above the current pay rate is recognized only upon actual receipt.

Deferred origination fees, original issue discounts and loan origination costs, if any, are recognized as an adjustment to interest income over the terms of the related investments using the effective interest method. Fees received in connection with loan commitments are also deferred until the loan is funded and are then recognized over the term of the loan as an adjustment to yield. Discounts or premiums associated with the purchase of loans are amortized or accreted into interest income as a yield adjustment on the effective interest method based on expected cash flows through the expected maturity date of the related investment. If we purchase a debt or preferred equity investment at a discount, intend to hold it until maturity and expect to recover the full value of the investment, we accrete the discount into income as an adjustment to yield over the term of the investment. If we purchase a debt or preferred equity investment at a discount with the intention of foreclosing on the collateral, we do not accrete the discount. For debt investments acquired at a discount for credit quality, the difference between contractual cash flows and expected cash flows at acquisition is not accreted. Anticipated exit fees, the collection of which is expected, are also recognized over the term of the loan as an adjustment to yield.

Debt and preferred equity investments are placed on a non-accrual status at the earlier of the date at which payments become 90 days past due or when, in the opinion of management, a full recovery of interest income becomes doubtful. Interest income recognition is resumed on any debt or preferred equity investment that is on non-accrual status when such investment becomes contractually current and performance is demonstrated to be resumed.

We may syndicate a portion of the loans that we originate or sell the loans individually. When a transaction meets the criteria for sale accounting, we recognize gain or loss based on the difference between the sales price and the carrying value of the loan sold. Any related unamortized deferred origination fees, original issue discounts, loan origination costs, discounts or premiums at the time of sale are recognized as an adjustment to the gain or loss on sale, which is included in investment income on the consolidated statement of operations. Any fees received at the time of sale or syndication are recognized as part of investment income.

Asset management fees are recognized on a straight-line basis over the term of the asset management agreement.

Debt and Preferred Equity Investments

Debt and preferred equity investments are presented at the net amount expected to be collected. An allowance for loan losses is deducted from the amortized cost basis of the financial assets to present the net carrying value at the amount expected to be collected through the expected maturity date of such investments. The expense for loan loss and other investment reserves is the charge to earnings to adjust the allowance for loan losses to the appropriate level.

The Company evaluates the amount expected to be collected based on current market and economic conditions, historical loss information, and reasonable and supportable forecasts. The Company's assumptions are derived from both internal data and external data which may include, among others, governmental economic projections for the New York City Metropolitan area, public data on recent transactions and filings for securitized debt instruments. This information is aggregated by asset class and adjusted for duration. Based on these inputs, loans are evaluated at the individual asset level. In certain instances, we may also use a probability-weighted model that considers the likelihood of multiple outcomes and the amount expected to be collected for each outcome.

The evaluation of the possible credit deterioration associated with the performance and/or value of the underlying collateral property as well as the financial and operating capability of the borrower/sponsor requires significant judgment, which include both asset level and market assumptions over the relevant time period.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

In addition, quarterly, the Company assigns each loan a risk rating. Based on a 3-point scale, loans are rated “1” through “3,” from lower risk to higher risk, which ratings are defined as follows: 1 - Low Risk Assets - Low probability of loss, 2 - Watch List Assets - Higher potential for loss, 3 - High Risk Assets - Loss more likely than not. Loans with risk ratings of 2 or above are evaluated to determine whether the expected risk of loss is appropriately captured through the combination of our expectations of current conditions, historical loss information and supportable forecasts described above or whether risk characteristics specific to the loan warrant the use of a probability-weighted model.

Financing investments that are classified as held for sale are carried at the expected amount to be collected or fair market value using available market information obtained through consultation with dealers or other originators of such investments as well as discounted cash flow models based on Level 3 data pursuant to ASC 820-10. As circumstances change, management may conclude not to sell an investment designated as held for sale. In such situations, the investment will be reclassified at its expected amount to be collected.

Other financing receivables that are included in balance sheet line items other than the Debt and Preferred Equity Investments line are also measured at the net amount expected to the be collected.

Accrued interest receivable amounts related to these debt and preferred equity investment and other financing receivables are recorded at the net amount expected to be collected within Other assets in the consolidated balance sheets. Write offs of accrued interest receivables are recognized as an expense for loan loss and other investment reserves.

Income Taxes

SL Green is taxed as a REIT under Section 856(c) of the Code. As a REIT, SL Green generally is not subject to Federal income tax. To maintain its qualification as a REIT, SL Green must distribute at least 90% of its REIT taxable income to its stockholders and meet certain other requirements. If SL Green fails to qualify as a REIT in any taxable year, SL Green will be subject to Federal income tax on its taxable income at regular corporate rates. SL Green may also be subject to certain state, local and franchise taxes. Under certain circumstances, Federal income and excise taxes may be due on its undistributed taxable income.

The Operating Partnership is a partnership and, as a result, all income and losses of the partnership are allocated to the partners for inclusion in their respective income tax returns. The only provision for income taxes included in the consolidated statements of operations relates to the Operating Partnership’s consolidated taxable REIT subsidiaries. The Operating Partnership may also be subject to certain state, local and franchise taxes.

We have elected, and may elect in the future, to treat certain of our corporate subsidiaries as taxable REIT subsidiaries, or TRSs. In general, TRSs may perform non-customary services for the tenants of the Company, hold assets that we cannot hold directly and generally may engage in any real estate or non-real estate related business. The TRSs generate income, resulting in Federal and state income tax liability for these entities.

During the three months ended September 30, 2020, we recorded no Federal, state and local tax provisions. During the nine months ended September 30, 2020, we recorded Federal, state and local tax provisions of $2.0 million. During the three and nine months ended September 30, 2019, we recorded a Federal, state benefit of $1.0 million and a provision of $0.5 million, respectively.

We follow a two-step approach for evaluating uncertain tax positions. Recognition (step one) occurs when an enterprise concludes that a tax position, based solely on its technical merits, is more-likely-than-not to be sustained upon examination. Measurement (step two) determines the amount of benefit that is more-likely-than-not to be realized upon settlement. Derecognition of a tax position that was previously recognized would occur when a company subsequently determines that a tax position no longer meets the more-likely-than-not threshold of being sustained. The use of a valuation allowance as a substitute for derecognition of tax positions is prohibited.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

Concentrations of Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash investments, debt and preferred equity investments and accounts receivable. We place our cash investments with high quality financial institutions. The collateral securing our debt and preferred equity investments is located in New York City. See Note 5, "Debt and Preferred Equity Investments."

We perform initial and ongoing evaluations of the credit quality of our tenants and require most tenants to provide security deposits or letters of credit. Though these security deposits and letters of credit are insufficient to meet the total value of a tenant's lease obligation, they are a measure of good faith and a potential source of funds to offset the economic costs associated with lost revenue from that tenant and the costs associated with re-tenanting a space. The properties in our real estate portfolio are located in the New York metropolitan area. The tenants located in our buildings operate in various industries. Other than one tenant, ViacomCBS Inc., which accounts for 5.5% of our share of annualized cash rent, no other tenant in our portfolio accounted for more than 5.0% of our share of annualized cash rent, including our share of joint venture annualized rent, at September 30, 2020.

For the three months ended September 30, 2020, the following properties contributed more than 5.0% of our annualized cash rent from office properties, including our share of annualized cash rent from joint venture office properties:


Property			Three months ended September 30, 2020
1185 Avenue of the Americas			8.4%
11 Madison Avenue			8.1%
420 Lexington Avenue			7.4%
1515 Broadway			6.3%
220 East 42nd Street			5.9%
280 Park Avenue			5.4%
485 Lexington Avenue			5.0%

Reclassification

Certain prior year balances have been reclassified to conform to our current year presentation.

Accounting Standards Updates

In August 2020, the FASB issued Accounting Standard Update, or "ASU", No. 2020-06 Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40). ASU 2020-06 simplifies the accounting for convertible instruments by reducing the number of accounting models for convertible debt instruments and convertible preferred stock, removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and also simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective for reporting periods beginning after December 15, 2021, with early adoption permitted. We are currently evaluating the impact of the adoption of ASU 2020-06 on our consolidated financial statements, but do not believe the adoption of this standard will have a material impact on our consolidated financial statements.

In April 2020, the FASB staff issued a question and answer document (the “Lease Modification Q&A”) on the application of lease accounting guidance to lease concessions provided as a result of the COVID-19 pandemic. Under existing lease guidance, the entity would have to determine, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant, which would be accounted for under the lease modification framework, or if a lease concession was under the enforceable rights and obligations that existed in the original lease, which would be accounted for outside the lease modification framework. The Lease Modification Q&A provides entities with the option to elect to account for lease concessions as though the enforceable rights and obligations existed in the original lease. This election is only available when total cash flows resulting from the modified lease are substantially similar to the cash flows in the original lease. The Lease Modification Q&A has no material impact on the Company’s consolidated financial statements as of and for the nine months ended September 30, 2020, however, its future impact to the Company is dependent upon the extent of lease concessions granted to tenants as a result of the COVID-19 pandemic in future periods and the elections made by the Company at the time of entering into such concessions.

In March 2020, the FASB issued ASU No. 2020-04 Reference Rate Reform (Topic 848) Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments provide practical expedients for reference rate reform related

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

activities that impact debt, leases, derivatives and other contracts. The guidance is optional and is effective between March 12, 2020 and December 31, 2022. The guidance may be elected over time as reference rate reform activities occur. During the first quarter of 2020, the Company has elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur.

In January 2020, the FASB issued ASU No. 2020-01, Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) Clarifying the Interactions between Topic 321, Topic 323, and Topic 815. The amendment most relevant to the Company is how to apply the fair value measurement alternative in Topic 321 when an investor must apply the fair value to an investment under the equity method in Topic 323. The amendment clarifies that an entity should consider observable transactions when considering the fair value of an investment. The guidance is effective for the Company for fiscal years beginning after December 15, 2020. Early adoption is permitted. The Company adopted this guidance on January 1, 2020 and it did not have a material impact on the Company’s consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other- Internal-Use Software (Topic 350-40), Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract. The amendments provide guidance on accounting for fees paid when the arrangement includes a software license and align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing costs to develop or obtain internal-use software. The Company adopted this guidance on January 1, 2020 and it did not have a material impact on the Company’s consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820), Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. This amendment removed, modified and added the disclosure requirements under Topic 820. The changes are effective for the Company for fiscal years beginning after December 15, 2019. Early adoption is permitted for the removed or modified disclosures with adoption of the additional disclosures upon the effective date. The Company adopted this guidance on January 1, 2020 and it did not have a material impact on the Company’s consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments; in November 2018 issued ASU No. 2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses, in April, May and November 2019, issued ASU No. 2019-04, 2019-05 and 2019-11, which provide codification improvements and targeted transition relief; and in 2020 issued ASU 2020-02 Financial Instruments-Credit Losses (Topic 326) and Leases (Topic 842), which updates SEC guidance in those Topics. The guidance changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The guidance replaces the current ‘incurred loss’ model with an ‘expected loss’ approach. The Company’s DPE portfolio and financing lease assets are subject to this guidance. ASU No. 2018-19 excludes operating lease receivables from the scope of this guidance. The Company adopted this guidance on January 1, 2020 and recorded a $39.2 million cumulative adjustment to retained earnings upon adoption.

3. Property Acquisitions

The following table summarizes the properties acquired during the nine months ended September 30, 2020:

Property

Acquisition Date

Property Type

Approximate Square Feet

Gross Asset Valuation
(in millions)

762 Madison Avenue (1)

January 2020

Fee Interest

6,109

29.3

707 Eleventh Avenue

January 2020

Fee Interest

159,720

90.0

126 Nassau Street (2)

January 2020

Leasehold Interest

98,412

—

(1)The Company acquired from our joint venture partner the remaining 10% interest in this property that the Company did not already own.

(2)In January 2020, the Company entered into a 99-year ground lease of 126 Nassau Street. In August 2020, we entered into a partnership with Meritz Alternative Investment as part of the capitalization of this development project. See note 6, "Investments in Unconsolidated Joint Ventures."

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

4. Properties Held for Sale and Property Dispositions

Properties Held for Sale

As of September 30, 2020, no properties were classified as held for sale.

Property Dispositions

The following table summarizes the properties sold during the nine months ended September 30, 2020:


Property	Disposition Date	Property Type	Approximate Square Feet	Sales Price(1) (in millions)		Gain (loss)(2) (in millions)
315 West 33rd Street - "The Olivia"	March 2020	Fee Interest	492,987	$	446.5	$	72.3
609 Fifth Avenue Retail Condominium	May 2020	Fee Interest	21,437	168.0		65.4
400 East 58th Street	September 2020	Fee Interest	140,000	62.0		8.3

(1)Sales price represents the gross sales price for a property or the gross asset valuation for interests in a property.

(2)The gains on sale for 315 West 33rd Street - "The Olivia" and 609 Fifth Avenue Retail Condominium are net of $6.0 million and $2.0 million, respectively, of employee compensation accrued in connection with the realization of these investment gains. Additionally, amounts do not include adjustments for expenses recorded in subsequent periods.

5. Debt and Preferred Equity Investments

Below is a summary of the activity in our debt and preferred equity investments for the nine months ended September 30, 2020 and the twelve months ended December 31, 2019 (in thousands):


	September 30, 2020		December 31, 2019
Balance at beginning of year (1)	$	1,580,306	$	2,099,393
Debt investment originations/accretion (2)	383,365		652,866
Preferred equity investment originations/accretion (2)	163,821		14,736
Redemptions/sales/syndications/equity ownership/amortization (3)	(956,869)		(1,190,689)
Net change in loan loss reserves	(17,260)		4,000
Balance at end of period (1)	$	1,153,363	$	1,580,306

(1)Net of unamortized fees, discounts, and premiums.

(2)Accretion includes amortization of fees and discounts and paid-in-kind investment income.

(3)Certain participations in debt investments that were sold or syndicated, but did not meet the conditions for sale accounting, are included in other assets and other liabilities on the consolidated balance sheets.

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

Below is a summary of our debt and preferred equity investments as of September 30, 2020 (dollars in thousands):


	Floating Rate					Fixed Rate					Total Carrying Value		Senior Financing		Maturity (1)
Type	Carrying Value		Face Value		Interest Rate	Carrying Value		Face Value		Interest Rate
Senior Mortgage Debt	$	62,683	$63,425		L + 2.00% - 3.50%	$	1,249	$1,250		3.00%	$	63,932	$	—	2020 - 2022
Junior Mortgage Debt	85,295		96,697		L + 6.00% - 7.25%	32,805		33,000		6.00%	$	118,100	542,241		2020 - 2023
Mezzanine Debt	278,726		283,336		L + 4.95% - 14.62%	436,040		447,265		2.90% - 9.30%	$	714,766	4,447,803		2020 - 2029
Preferred Equity	—		—		—	256,565		259,431		6.50% - 11.00%	$	256,565	1,962,750		2022 - 2027
Balance at end of period	$	426,704	$	443,458	—	$	726,659	$	740,946	—	$	1,153,363

(1)Excludes available extension options to the extent they have not been exercised as of the date of this filing.

The following table is a rollforward of our total allowance for loan losses for the nine months ended September 30, 2020 and the twelve months ended December 31, 2019 (in thousands):


	September 30, 2020		December 31, 2019
Balance at beginning of year	$	1,750	$	5,750
Cumulative adjustment upon adoption of ASC 326	27,804		—
Current period provision for loan loss	20,741		—
Write-offs charged against the allowance	(31,285)		(4,000)
Balance at end of period	$	19,010	$	1,750

At September 30, 2020, all debt and preferred equity investments were performing in accordance with their respective terms, with the exception of two investments with a carrying value, net of reserves, of $25.3 million, as discussed in subnotes 6 and 7 of the Debt Investments table below. At December 31, 2019, all debt and preferred equity investments were performing in accordance with their respective terms.

No other financing receivables were 90 days past due at September 30, 2020 and December 31, 2019 with the exception of a $27.7 million financing receivable which was put on nonaccrual in August 2018 as a result of interest default.

As of September 30, 2020, management estimated the weighted average risk rating for our debt and preferred equity investments to be 1.4.

We have determined that we have one portfolio segment of financing receivables at September 30, 2020 and December 31, 2019 comprising commercial real estate which is primarily recorded in debt and preferred equity investments. Included in other assets is an additional amount of financing receivables representing loans to joint venture partners totaling $110.9 million and $131.1 million at September 30, 2020 and December 31, 2019, respectively, for which the Company recorded adjustments upon adoption of ASC 326 of $11.4 million and provisions for loan losses of $0.0 million and $6.3 million for the three and nine months ended September 30, 2020, respectively.

Debt Investments

As of September 30, 2020 and December 31, 2019, we held the following debt investments with an aggregate weighted average current yield of 6.26% at September 30, 2020 (dollars in thousands):


Loan Type	September 30, 2020 Future Funding Obligations		September 30, 2020 Senior Financing		September 30, 2020 Carrying Value (1)		December 31, 2019 Carrying Value (1)		Maturity Date (2)
Fixed Rate Investments:
Mortgage/Mezzanine Loan	$	—	$	63,750	$	56,242	$	55,573	October 2020 (3)
Junior Mortgage(4b)	10,000		67,000		32,805		—		January 2021

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)


Loan Type	September 30, 2020 Future Funding Obligations		September 30, 2020 Senior Financing		September 30, 2020 Carrying Value (1)		December 31, 2019 Carrying Value (1)		Maturity Date (2)
Mezzanine Loan	—		15,000		3,500		3,500		September 2021
Mezzanine Loan	—		280,000		40,458		38,734		August 2022
Mezzanine Loan(5)	—		348,327		225,204		215,737		June 2023
Mezzanine Loan(4a)(6)	—		115,000		13,265		12,950		June 2024
Mezzanine Loan	—		95,000		30,000		30,000		January 2025
Mezzanine Loan	—		1,712,750		55,250		55,250		June 2027
Mezzanine Loan	—		85,000		20,000		20,000		December 2029
Mezzanine Loan	—		—		—		24,952
Mezzanine Loan	—		—		—		30,000
Mezzanine Loan	—		—		—		12,714
Total fixed rate	$	10,000	$	2,781,827	$	476,724	$	499,410
Floating Rate Investments:
Junior Mortgage(7)	$	—	$	40,000	$	20,000	$	20,000	April 2020
Mezzanine Loan	—		275,000		49,919		49,809		April 2021
Junior Mortgage Participation/Mezzanine Loan	—		60,000		15,724		15,698		July 2021
Mezzanine Loan	7,933		169,540		46,613		41,395		July 2021
Mezzanine Loan	5,329		54,204		23,753		15,743		July 2021
Mezzanine Loan(4c)	—		1,115,000		126,486		222,775		March 2022
Mortgage/Mezzanine Loan	7,425		—		60,116		—		May 2022
Mortgage/Mezzanine Loan	44,000		—		13,987		13,918		December 2022
Mortgage Loan(8)	35,303		375,241		63,899		—		February 2023
Mezzanine Loan	55,033		59,232		18,587		69,839		May 2023
Mortgage/Mezzanine Loan	—		—		—		35,386
Mortgage Loan	—		—		—		19,971
Mortgage Loan	—		—		—		106,473
Mezzanine Loan	—		—		—		51,387
Mortgage/Mezzanine Loan	—		—		—		96,570
Mortgage/Mezzanine Loan	—		—		—		82,696
Total floating rate	$	155,023	$	2,148,217	$	439,084	$	841,660
Allowance for loan loss	$	—	$	—	$	(19,010)	$	—
Total	$	165,023	$	4,930,044	$	896,798	$	1,341,070

(1)Carrying value is net of discounts, premiums, original issue discounts and deferred origination fees.

(2)Represents contractual maturity, excluding any unexercised extension options.

(3)In October 2020, this loan was extended one year to October 2021.

(4)Carrying value is net of the following amounts that were sold or syndicated, which are included in other assets and other liabilities on the consolidated balance sheets as a result of the transfers not meeting the conditions for sale accounting: (a) $12.0 million, (b) $66.6 million and (c) $0.4 million.

(5)This loan is on non-accrual at September 30, 2020.

(6)This loan is in default and on non-accrual as of the date of this filing. The Company is in discussions with the borrower.

(7)As of September 30, 2020 this loan was in default and on non-accrual. In October 2020, the Company accepted a purchase in lieu of repayment and marked the assets received and liabilities assumed to fair value.

(8)This loan was sold on October 1, 2020.

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

Preferred Equity Investments

As of September 30, 2020 and December 31, 2019, we held the following preferred equity investments with an aggregate weighted average current yield of 9.98% at September 30, 2020 (dollars in thousands):


Type	September 30, 2020 Future Funding Obligations		September 30, 2020 Senior Financing		September 30, 2020 Carrying Value (1)		December 31, 2019 Carrying Value (1)		Mandatory Redemption (2)
Preferred Equity	$	—	$	1,712,750	$	153,196	$	98,065	June 2022
Preferred Equity	—		250,000		103,369		—		February 2027
Preferred Equity(3)	—		—		—		142,921
Total Preferred Equity	$	—	$	1,962,750	$	256,565	$	240,986
Allowance for loan loss	$	—	$	—	$	—	$	(1,750)
Total	$	—	$	1,962,750	$	256,565	$	239,236

(1)Carrying value is net of deferred origination fees.

(2)Represents contractual maturity, excluding any unexercised extension options.

(3)In June 2020, we, along with the common member in the investment, amended the partnership documents related to the investment to provide us with more rights over management of the underlying property. This resulted in the investment being accounted for using the equity method. See Note 6, "Investments in Unconsolidated Joint Ventures."

6. Investments in Unconsolidated Joint Ventures

We have investments in several real estate joint ventures with various partners. As of September 30, 2020, the book value of these investments was $2.9 billion, net of investments with negative book values totaling $85.8 million for which we have an implicit commitment to fund future capital needs.

As of September 30, 2020 and December 31, 2019, 800 Third Avenue, 21 East 66th Street, 605 West 42nd Street, 333 East 22nd Street, and certain properties within the Stonehenge Portfolio are VIEs in which we are not the primary beneficiary. Our net equity investment in these VIEs was $136.3 million and $145.9 million as of September 30, 2020 and December 31, 2019, respectively. Our maximum loss is limited to the amount of our equity investment in these VIEs. See the "Principles of Consolidation" section of Note 2, "Significant Accounting Policies". All other investments below are voting interest entities. As we do not control the joint ventures listed below, we account for them under the equity method of accounting.

The table below provides general information on each of our joint ventures as of September 30, 2020:


Property	Partner	Ownership Interest(1)	Economic Interest(1)	Unaudited Approximate Square Feet
100 Park Avenue	Prudential Real Estate Investors	49.90%	49.90%	834,000
717 Fifth Avenue	Wharton Properties/Private Investor	10.92%	10.92%	119,500
800 Third Avenue	Private Investors	60.52%	60.52%	526,000
919 Third Avenue	New York State Teacher's Retirement System	51.00%	51.00%	1,454,000
11 West 34th Street	Private Investor/Wharton Properties	30.00%	30.00%	17,150
280 Park Avenue	Vornado Realty Trust	50.00%	50.00%	1,219,158
1552-1560 Broadway(2)	Wharton Properties	50.00%	50.00%	57,718
10 East 53rd Street	Canadian Pension Plan Investment Board	55.00%	55.00%	354,300
21 East 66th Street(3)	Private Investors	32.28%	32.28%	13,069
650 Fifth Avenue(4)	Wharton Properties	50.00%	50.00%	69,214
121 Greene Street	Wharton Properties	50.00%	50.00%	7,131
55 West 46th Street	Prudential Real Estate Investors	25.00%	25.00%	347,000
Stonehenge Portfolio	Various	Various	Various	1,439,016
605 West 42nd Street	The Moinian Group	20.00%	20.00%	927,358
11 Madison Avenue	PGIM Real Estate	60.00%	60.00%	2,314,000
333 East 22nd Street	Private Investors	33.33%	33.33%	26,926
400 East 57th Street(5)	BlackRock, Inc and Stonehenge Partners	51.00%	41.00%	290,482

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)


Property	Partner	Ownership Interest(1)	Economic Interest(1)	Unaudited Approximate Square Feet
One Vanderbilt	National Pension Service of Korea/Hines Interest LP	71.01%	71.01%	—
Worldwide Plaza	RXR Realty / New York REIT / Private Investor	24.35%	24.35%	2,048,725
1515 Broadway	Allianz Real Estate of America	56.87%	56.87%	1,750,000
2 Herald Square	Israeli Institutional Investor	51.00%	51.00%	369,000
115 Spring Street	Private Investor	51.00%	51.00%	5,218
885 Third Avenue(6)	Private Investor	(6)	100.00%	625,300
126 Nassau Street(7)	Meritz Alternative Investment Management	20.00%	20.00%	98,412

(1)Ownership interest and economic interest represent the Company's interests in the joint venture as of September 30, 2020. Changes in ownership or economic interests within the current year are disclosed in the notes below.

(2)The acquisition price represents only the purchase of the 1552 Broadway interest, which comprised approximately 13,045 square feet. The joint venture also owns a long-term leasehold interest in the retail space and certain other spaces at 1560 Broadway, which is adjacent to 1552 Broadway.

(3)We hold a 32.28% interest in three retail units and one residential unit at the property and a 16.14% interest in three residential units at the property.

(4)The joint venture owns a long-term leasehold interest in the retail space at 650 Fifth Avenue.

(5)In October 2016, we sold a 49% interest in this property. Our interest in the property was sold within a consolidated joint venture owned 90% by the Company and 10% by Stonehenge. The transaction resulted in the deconsolidation of the venture's remaining 51% interest in the property. Our joint venture with Stonehenge remains consolidated resulting in the combined 51% interest being shown within investments in unconsolidated joint ventures on our balance sheet.

(6)We hold 100% of the preferred equity interest in the property and believe there is no value to the common equity.

(7)In August 2020, the Company formed a joint venture, which then entered into a long-term sublease with the Company. As a result of this transaction, we recognized a gain of $17.7 million, which is included in Gain on sale of real estate, net, in our consolidated statements of operations. This gain was calculated in accordance with ASC 842, as the Company identified the lease and non-lease components included in the sublease agreement and allocated the consideration in the agreement to each lease and non-lease component based on each components’ standalone selling price, which was estimated utilizing a combination of the adjusted market assessment and residual approaches as provided for in ASC 606.

Disposition of Joint Venture Interests or Properties

We did not dispose of any investments in unconsolidated joint ventures during the nine months ended September 30, 2020:

Joint Venture Mortgages and Other Loans Payable

We generally finance our joint ventures with non-recourse debt. In certain cases we may provide guarantees or master leases for tenant space, which terminate upon the satisfaction of specified circumstances or repayment of the underlying loans. The mortgage notes and other loans payable collateralized by the respective joint venture properties and assignment of leases at September 30, 2020 and December 31, 2019, respectively, are as follows (dollars in thousands):


Property	Economic Interest (1)		Initial Maturity Date	Final Maturity Date (2)	Interest Rate (3)			September 30, 2020		December 31, 2019
Fixed Rate Debt:
885 Third Avenue (4)	100.00	%	April 2021	April 2021		3.35	%	$	272,000	$	—
717 Fifth Avenue (mortgage)	10.92	%	July 2022	July 2022		4.45	%	300,000		300,000
717 Fifth Avenue (mezzanine)	10.92	%	July 2022	July 2022		5.50	%	355,328		355,328
650 Fifth Avenue (mortgage)	50.00	%	October 2022	October 2022		4.46	%	210,000		210,000
650 Fifth Avenue (mezzanine)	50.00	%	October 2022	October 2022		5.45	%	65,000		65,000
21 East 66th Street	32.28	%	April 2023	April 2028		3.60	%	12,000		12,000
919 Third Avenue	51.00	%	June 2023	June 2023		5.12	%	500,000		500,000
1515 Broadway	56.87	%	March 2025	March 2025		3.93	%	825,204		838,546
11 Madison Avenue	60.00	%	September 2025	September 2025		3.84	%	1,400,000		1,400,000
800 Third Avenue	60.52	%	February 2026	February 2026		3.37	%	177,000		177,000
400 East 57th Street	41.00	%	November 2026	November 2026		3.00	%	97,024		97,735
Worldwide Plaza	24.35	%	November 2027	November 2027		3.98	%	1,200,000		1,200,000
Stonehenge Portfolio (5)	Various		Various	Various		3.50	%	195,899		196,112

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)


Property	Economic Interest (1)		Initial Maturity Date	Final Maturity Date (2)	Interest Rate (3)			September 30, 2020		December 31, 2019
Total fixed rate debt								$	5,609,455	$	5,351,721
Floating Rate Debt:
121 Greene Street	50.00	%	November 2020	November 2021	L+	1.50	%	$	15,000	$	15,000
11 West 34th Street	30.00	%	January 2021	January 2023	L+	1.45	%	23,000		23,000
100 Park Avenue	49.90	%	February 2021	February 2021	L+	1.75	%	354,087		356,972
280 Park Avenue	50.00	%	September 2021	September 2024	L+	1.73	%	1,200,000		1,200,000
One Vanderbilt (6)	71.01	%	September 2021	September 2023	L+	2.50	%	1,094,873		732,928
1552 Broadway	50.00	%	October 2021	October 2022	L+	2.65	%	195,000		195,000
2 Herald Square	51.00	%	November 2021	November 2023	L+	1.45	%	214,500		190,000
55 West 46th Street (7)	25.00	%	August 2022	August 2024	L+	1.25	%	192,524		192,524
115 Spring Street	51.00	%	September 2023	September 2023	L+	3.40	%	65,550		65,550
126 Nassau Street (8)	20.00	%	January 2024	July 2025	L+	1.50	%	5,593		—
10 East 53rd Street	55.00	%	February 2025	February 2025	L+	1.35	%	220,000		170,000
605 West 42nd Street	20.00	%	August 2027	August 2027	L+	1.44	%	550,000		550,000
21 East 66th Street	32.28	%	June 2033	June 2033	1 Year Treasury+	2.75	%	688		712
Total floating rate debt								$	4,130,815	$	3,691,686
Total joint venture mortgages and other loans payable								$	9,740,270	$	9,043,407
Deferred financing costs, net								(87,763)		(91,538)
Total joint venture mortgages and other loans payable, net								$	9,652,507	$	8,951,869

(1)Economic interest represents the Company's interests in the joint venture as of September 30, 2020. Changes in ownership or economic interests, if any, within the current year are disclosed in the notes to the investment in unconsolidated joint ventures table above.

(2)Reflects exercise of all available extension options. The ability to exercise extension options may be subject to certain tests based on the operating performance of the property.

(3)Interest rates as of September 30, 2020, taking into account interest rate hedges in effect during the period. Floating rate debt is presented with the stated spread over the 30-day LIBOR, unless otherwise specified.

(4)The Company holds 100% of the preferred equity interest in the property and believes that there is no value to the common equity. In August 2020, the servicer asserted certain loan defaults. The venture has determined that the servicer is misinterpreting the loan documents and is contesting the assertion. The servicer has taken no additional action on the loan.

(5)Comprised of three mortgages totaling $132.4 million that mature in April 2028 and two mortgages totaling $63.5 million that mature in July 2029.

(6)This loan is a $1.75 billion construction facility with reductions in interest cost based on meeting conditions, the first of which has been satisfied, and has an initial five-year term with two one-year extension options. Advances under the loan are subject to costs incurred.

(7)This loan has a committed amount of $198.0 million, of which $5.5 million was unfunded as of September 30, 2020.

(8)This loan is a $125.0 million construction facility. Advances under the loan are subject to costs incurred.

We are entitled to receive fees for providing management, leasing, construction supervision and asset management services to certain of our joint ventures. We earned $2.2 million and $6.1 million from these services, net of our ownership share of the joint ventures, for the three and nine months ended September 30, 2020, respectively. We earned $2.4 million and $8.8 million from these services, net of our ownership share of the joint ventures, for the three and nine months ended September 30, 2019, respectively. In addition, we have the ability to earn incentive fees based on the ultimate financial performance of certain of the joint venture properties.

The combined balance sheets for the unconsolidated joint ventures, at September 30, 2020 and December 31, 2019 are as follows (in thousands):


	September 30, 2020		December 31, 2019
Assets (1)
Commercial real estate property, net	$	15,045,603	$	14,349,628
Cash and restricted cash	326,488		336,189
Tenant and other receivables, related party receivables, and deferred rents receivable	404,138		371,065

Other assets	1,940,540		2,039,429

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)


Total assets	$	17,716,769	$	17,096,311
Liabilities and equity (1)
Mortgages and other loans payable, net	$	9,652,507	$	8,951,869
Deferred revenue	1,400,458		1,501,616
Lease liabilities	1,015,477		897,380
Other liabilities	294,972		308,304
Equity	5,353,355		5,437,142
Total liabilities and equity	$	17,716,769	$	17,096,311
Company's investments in unconsolidated joint ventures	$	2,946,673	$	2,912,842

(1)The combined assets, liabilities and equity for the unconsolidated joint ventures reflects the effect of step ups in basis on the retained, non-controlling interests in deconsolidated investments as a result of the adoption of ASC 610-20 in January 2018. In addition, at September 30, 2020, $166.8 million of net unamortized basis differences between the amount at which our investments are carried and our share of equity in net assets of the underlying property will be amortized through equity in net income (loss) from unconsolidated joint ventures over the remaining life of the underlying items having given rise to the differences.

The combined statements of operations for the unconsolidated joint ventures, from acquisition date through the three and nine months ended September 30, 2020 and 2019, are as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Total revenues	$	292,929	$	286,010	$	846,967	$	883,977
Operating expenses	44,650		50,759		131,578		153,397
Real estate taxes	56,459		53,321		161,566		159,544
Operating lease rent	6,385		6,713		18,947		18,848
Interest expense, net of interest income	79,723		92,601		245,685		282,917
Amortization of deferred financing costs	5,575		4,436		15,197		14,434

Depreciation and amortization	103,262		100,736		300,700		308,748
Total expenses	296,054		308,566		873,673		937,888
Loss on early extinguishment of debt	—		(1,031)		—		(1,031)
Net loss before gain on sale (1)	$	(3,125)	$	(23,587)	$	(26,706)	$	(54,942)
Company's equity in net loss from unconsolidated joint ventures (1)	$	(432)	$	(9,864)	$	(15,445)	$	(22,644)

(1)The combined statements of operations and the Company's equity in net loss for the unconsolidated joint ventures reflects the effect of step ups in basis on the retained non-controlling interests in deconsolidated investments as a result of the adoption of ASC 610-20 in January 2018.

7. Deferred Costs

Deferred costs at September 30, 2020 and December 31, 2019 consisted of the following (in thousands):


	September 30, 2020		December 31, 2019
Deferred leasing costs	$	496,812	$	466,136
Less: accumulated amortization	(290,523)		(260,853)
Deferred costs, net	$	206,289	$	205,283

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

8. Mortgages and Other Loans Payable

The mortgages and other loans payable collateralized by the respective properties and assignment of leases or debt investments at September 30, 2020 and December 31, 2019, respectively, were as follows (dollars in thousands):


Property	Initial Maturity Date	Final Maturity Date (1)	Interest Rate (2)		September 30, 2020		December 31, 2019
Fixed Rate Debt:
100 Church Street	July 2022	July 2022		4.68%	$	206,013	$	209,296
420 Lexington Avenue	October 2024	October 2040		3.99%	295,355		299,165
Landmark Square	January 2027	January 2027		4.90%	100,000		100,000
485 Lexington Avenue	February 2027	February 2027		4.25%	450,000		450,000
1080 Amsterdam (3)	February 2027	February 2027		3.59%	34,773		35,123
762 Madison Avenue (4)					—		771
315 West 33rd Street (5)					—		250,000
400 East 58th Street							39,094
Total fixed rate debt					$	1,086,141	$	1,383,449
Floating Rate Debt:
133 Greene Street	(6)	(6)	L+	2.00%	$	15,523	$	15,523
106 Spring Street	January 2021	January 2022	L+	2.50%	38,025		38,025
FHLB Facility	January 2021	January 2021	L+	0.28%	10,000		—
FHLB Facility	January 2021	January 2021	L+	0.23%	15,000		—
FHLB Facility	January 2021	January 2021	L+	0.18%	35,000		—
609 Fifth Avenue	March 2021	March 2024	L+	2.40%	57,651		53,773
185 Broadway (7)	November 2021	November 2023	L+	2.85%	144,448		120,110
712 Madison Avenue	December 2021	December 2022	L+	1.85%	28,000		28,000
220 East 42nd Street	June 2023	June 2025	L+	2.75%	510,000		—
410 Tenth Avenue (8)	August 2023	August 2025	L+	2.25%	434,934		330,819
719 Seventh Avenue	September 2023	September 2023	L+	1.20%	50,000		50,000
2017 Master Repurchase Agreement (9)					—		152,684
FHLB Facility					—		10,000
FHLB Facility					—		15,000
FHLB Facility					—		14,500
Total floating rate debt					$	1,338,581	$	828,434


Total mortgages and other loans payable					$	2,424,722	$	2,211,883
Deferred financing costs, net of amortization					(32,978)		(28,630)
Total mortgages and other loans payable, net					$	2,391,744	$	2,183,253

(1)Reflects exercise of all available extension options. The ability to exercise extension options may be subject to certain tests based on the operating performance of the property.

(2)Interest rate as of September 30, 2020, taking into account interest rate hedges in effect during the period. Floating rate debt is presented with the stated spread over the 30-day LIBOR, unless otherwise specified.

(3)The loan is comprised of a $33.9 million mortgage loan and $0.9 million mezzanine loan with a fixed interest rate of 350 basis points and 700 basis points, respectively, for the first five years and is prepayable without penalty at the end of fifth year.

(4)In January 2020, the Company closed on the acquisition of the remaining 10% interest in this property from our joint venture partner. As part of this transaction, the loan was repaid.

(5)In March 2020, the loan was assumed by the buyer in connection with the sale of the property.

(6)This loan matured in August 2020. The Company is in discussions with the lender on resolution.

(7)This loan is a $225.0 million construction facility, with reductions in interest cost based on meeting certain conditions, and has an initial three-year term with two one-year extension options. Advances under the loan are subject to incurred costs and funded equity requirements.

(8)This loan is a $600.0 million construction facility and has an initial three-year term with two one-year extension options. Advances under the loan are subject to incurred costs and funded equity requirements.

(9)In June 2020, we exercised a one-year extension option which extended the maturity date to June 2021. At September 30, 2020, there was no outstanding balance on the $400 million facility.

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

At September 30, 2020 and December 31, 2019, the gross book value of the properties and debt and preferred equity investments collateralizing the mortgages and other loans payable was approximately $3.2 billion and $3.3 billion, respectively.

Federal Home Loan Bank of New York ("FHLB") Facility

The Company's wholly-owned subsidiary, Ticonderoga Insurance Company, or Ticonderoga, a Vermont licensed captive insurance company, is a member of the Federal Home Loan Bank of New York, or FHLBNY. As a member, Ticonderoga may borrow funds from the FHLBNY in the form of secured advances that bear interest at a floating rate. Unless Congress or the Federal Home Finance Authority extends membership criteria, then on February 19, 2021 Ticonderoga’s membership in FHLB New York will terminate and all advances will need to be repaid by such date. As of September 30, 2020, Ticonderoga had a total of $60.0 million in outstanding secured advances with an average spread of 21 basis points over 30-day LIBOR.

Master Repurchase Agreement

The Company entered into a Master Repurchase Agreement, or MRA, known as the 2017 MRA, which provides us with the ability to sell certain mortgage investments with a simultaneous agreement to repurchase the same at a certain date or on demand. We seek to mitigate risks associated with our repurchase agreement by managing the credit quality of our assets, early repayments, interest rate volatility, liquidity, and market value. The margin call provisions under our repurchase facility permit valuation adjustments based on capital markets activity, and are not limited to collateral-specific credit marks. To monitor credit risk associated with our debt investments, our asset management team regularly reviews our investment portfolio and is in contact with our borrowers in order to monitor the collateral and enforce our rights as necessary. The risk associated with potential margin calls is further mitigated by our ability to collateralize the facility with additional assets from our portfolio of debt investments, our ability to satisfy margin calls with cash or cash equivalents and our access to additional liquidity. As of September 30, 2020, there have been no margin calls on the 2017 MRA.

In April 2018, we increased the maximum facility capacity from $300.0 million to $400.0 million. The facility bears interest on a floating rate basis at a spread to 30-day LIBOR based on the pledged collateral and advance rate and is scheduled to mature in June 2021, with a one-year extension option. At September 30, 2020, the facility had no outstanding balance.

9. Corporate Indebtedness

2017 Credit Facility

In November 2017, we entered into an amendment to the credit facility, referred to as the 2017 credit facility, that was originally entered into by the Company in November 2012, or the 2012 credit facility. As of September 30, 2020, the 2017 credit facility consisted of a $1.5 billion revolving credit facility, a $1.3 billion term loan (or "Term Loan A"), and a $200.0 million term loan (or "Term Loan B") with maturity dates of March 31, 2022, March 31, 2023, and November 21, 2024, respectively. The revolving credit facility has two six-month, as-of-right extension options to March 31, 2023. We also have an option, subject to customary conditions, to increase the capacity of the credit facility to $4.5 billion at any time prior to the maturity dates for the revolving credit facility and term loans without the consent of existing lenders, by obtaining additional commitments from our existing lenders or other financial institutions.

As of September 30, 2020, the 2017 credit facility bore interest at a spread over 30-day LIBOR ranging from (i) 82.5 basis points to 155 basis points for loans under the revolving credit facility, (ii) 90 basis points to 175 basis points for loans under Term Loan A, and (iii) 85 basis points to 165 basis points for loans under Term Loan B, in each case based on the credit rating assigned to the senior unsecured long term indebtedness of the Company. In instances where there are either only two ratings available or where there are more than two and the difference between them is one rating category, the applicable rating shall be the highest rating. In instances where there are more than two ratings and the difference between the highest and the lowest is two or more rating categories, then the applicable rating used is the average of the highest two, rounded down if the average is not a recognized category.

At September 30, 2020, the applicable spread was 100 basis points for the revolving credit facility, 110 basis points for Term Loan A, and 100 basis points for Term Loan B. We are required to pay quarterly in arrears a 12.5 to 30 basis point facility fee on the total commitments under the revolving credit facility based on the credit rating assigned to the senior unsecured long term indebtedness of the Company. As of September 30, 2020, the facility fee was 20 basis points.

As of September 30, 2020, we had $26.0 million of outstanding letters of credit, $190.0 million drawn under the revolving credit facility and $1.5 billion outstanding under the term loan facilities, with total undrawn capacity of $1.3 billion under the 2017 credit facility. At September 30, 2020 and December 31, 2019, the revolving credit facility had a carrying value of $184.8 million and $234.0 million, respectively, net of deferred financing costs. At September 30, 2020 and December 31, 2019, the term loan facilities had a carrying value of $1.5 billion and $1.5 billion, respectively, net of deferred financing costs.

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

The Company and the Operating Partnership are borrowers jointly and severally obligated under the 2017 credit facility.

The 2017 credit facility includes certain restrictions and covenants (see Restrictive Covenants below).

Senior Unsecured Notes

The following table sets forth our senior unsecured notes and other related disclosures as of September 30, 2020 and December 31, 2019, respectively, by scheduled maturity date (dollars in thousands):


Issuance	September 30, 2020 Unpaid Principal Balance		September 30, 2020 Accreted Balance		December 31, 2019 Accreted Balance		Interest Rate (1)			Initial Term (in Years)	Maturity Date
August 7, 2018 (2) (3)	$	350,000	$	350,000	$	350,000		1.52	%	3	August 2021
October 5, 2017 (2)	500,000		499,775		499,695			3.25	%	5	October 2022
November 15, 2012 (4)	300,000		302,352		303,142			4.50	%	10	December 2022
December 17, 2015 (5)	100,000		100,000		100,000			4.27	%	10	December 2025
March 16, 2010 (6)	—		—		250,000
	$	1,250,000	$	1,252,127	$	1,502,837
Deferred financing costs, net			(4,332)		(5,990)
	$	1,250,000	$	1,247,795	$	1,496,847

(1)Interest rate as of September 30, 2020, taking into account interest rate hedges in effect during the period.

(2)Issued by the Operating Partnership with the Company as the guarantor.

(3)The notes are subject to redemption at the Company's option, in whole but not in part, at a redemption price equal to 100% of the principal amount of the notes, plus unpaid accrued interest thereon to the redemption date. In April 2020, the Company entered into $350.0 million of fixed rate interest swaps at a rate of 0.54375% through August 2021.

(4)In October 2017, the Company and the Operating Partnership as co-obligors issued an additional $100.0 million of 4.50% senior unsecured notes due December 2022. The notes were priced at 105.334% of par.

(5)Issued by the Company and the Operating Partnership as co-obligors.

(6)In March 2020, the notes were repaid.

Restrictive Covenants

The terms of the 2017 credit facility and certain of our senior unsecured notes include certain restrictions and covenants which may limit, among other things, our ability to pay dividends, make certain types of investments, incur additional indebtedness, incur liens and enter into negative pledge agreements and dispose of assets, and which require compliance with financial ratios relating to the maximum ratio of total indebtedness to total asset value, a minimum ratio of EBITDA to fixed charges, a maximum ratio of secured indebtedness to total asset value and a maximum ratio of unsecured indebtedness to unencumbered asset value. The dividend restriction referred to above provides that, we will not during any time when a default is continuing, make distributions with respect to common stock or other equity interests, except to enable the Company to continue to qualify as a REIT for Federal income tax purposes. As of September 30, 2020 and December 31, 2019, we were in compliance with all such covenants.

Junior Subordinated Deferrable Interest Debentures

In June 2005, the Company and the Operating Partnership issued $100.0 million in unsecured trust preferred securities through a newly formed trust, SL Green Capital Trust I, or the Trust, which is a wholly-owned subsidiary of the Operating Partnership. The securities mature in 2035 and bear interest at a floating rate of 125 basis points over the three-month LIBOR. Interest payments may be deferred for a period of up to eight consecutive quarters if the Operating Partnership exercises its right to defer such payments. The Trust preferred securities are redeemable at the option of the Operating Partnership, in whole or in part, with no prepayment premium. We do not consolidate the Trust even though it is a variable interest entity as we are not the primary beneficiary. Because the Trust is not consolidated, we have recorded the debt on our consolidated balance sheets and the related payments are classified as interest expense.

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

Principal Maturities

Combined aggregate principal maturities of mortgages and other loans payable, the 2017 credit facility, trust preferred securities, senior unsecured notes and our share of joint venture debt as of September 30, 2020, including as-of-right extension options, were as follows (in thousands):


	Scheduled Amortization		Mortgages and Other Loans Payable		Revolving Credit Facility		Unsecured Term Loans		Trust Preferred Securities		Senior Unsecured Notes		Total		Joint Venture Debt
Remaining 2020	$	2,635	$	15,523	$	—	$	—	$	—	$	—	$	18,158	$	10,867
2021	10,766		270,474		—		—		—		350,000		631,240		1,444,277
2022	8,779		255,435		—		—		—		800,000		1,064,214		268,952
2023	6,608		994,934		190,000		1,300,000		—		—		2,491,542		311,436
2024	5,294		272,749		—		200,000		—		—		478,043		618,140
Thereafter	1,779		579,746		—		—		100,000		100,000		781,525		1,935,202
	$	35,861	$	2,388,861	$	190,000	$	1,500,000	$	100,000	$	1,250,000	$	5,464,722	$	4,588,874

Consolidated interest expense, excluding capitalized interest, was comprised of the following (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Interest expense before capitalized interest	$	42,595	$	63,607	$	144,345	$	185,163
Interest on financing leases	2,198		813		6,010		2,425
Interest capitalized	(20,677)		(15,700)		(57,528)		(38,228)
Interest income	(580)		(608)		(1,727)		(3,563)
Interest expense, net	$	23,536	$	48,112	$	91,100	$	145,797

10. Related Party Transactions

Cleaning/ Security/ Messenger and Restoration Services

Alliance Building Services, or Alliance, and its affiliates are partially owned by Gary Green, a son of Stephen L. Green, who serves as a member and as the chairman emeritus of our board of directors, and provide services to certain properties owned by us. Alliance’s affiliates include First Quality Maintenance, L.P., or First Quality, Classic Security LLC, Bright Star Couriers LLC and Onyx Restoration Works, and provide cleaning, extermination, security, messenger, and restoration services, respectively. In addition, First Quality has the non-exclusive opportunity to provide cleaning and related services to individual tenants at our properties on a basis separately negotiated with any tenant seeking such additional services. The Service Corporation has entered into an arrangement with Alliance whereby it will receive a profit participation above a certain threshold for services provided by Alliance to certain tenants at certain buildings above the base services specified in their lease agreements.

Income earned from the profit participation, which is included in other income on the consolidated statements of operations, was $0.1 million and $1.1 million for the three and nine months ended September 30, 2020, respectively, and $0.9 million and $2.7 million for the three and nine months ended September 30, 2019, respectively.

We also recorded expenses, inclusive of capitalized expenses, of $3.0 million and $9.7 million for the three and nine months ended September 30, 2020, respectively, for these services (excluding services provided directly to tenants), and $5.6 million and $14.1 million for the three and nine months ended September 30, 2019, respectively.

Management Fees

S.L. Green Management Corp., a consolidated entity, receives property management fees from an entity in which Stephen L. Green owns an interest. We received management fees from this entity of $0.1 million and $0.4 million for the three and nine months ended September 30, 2020, respectively, and $0.2 million and $0.5 million for the three and nine months ended September 30, 2019, respectively.

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

One Vanderbilt Investment

In December 2016, we entered into agreements with entities owned and controlled by our Chairman and CEO, Marc Holliday, and our President, Andrew Mathias, pursuant to which they agreed to make an investment in our One Vanderbilt project at the appraised fair market value for the interests acquired. This investment entitles these entities to receive approximately 1.50% - 1.80% and 1.00% - 1.20%, respectively, of any profits realized by the Company from its One Vanderbilt project in excess of the Company’s capital contributions. The entities have no right to any return of capital. Accordingly, subject to previously disclosed repurchase rights, these interests will have no value and will not entitle these entities to any amounts (other than limited distributions to cover tax liabilities incurred) unless and until the Company has received distributions from the One Vanderbilt project in excess of the Company’s aggregate investment in the project. In the event that the Company does not realize a profit on its investment in the project (or would not realize a profit based on the value at the time the interests are repurchased), the entities owned and controlled by Messrs. Holliday and Mathias will lose the entire amount of their investment. The entities owned and controlled by Messrs. Holliday and Mathias paid $1.4 million and $1.0 million, respectively, which equal the fair market value of the interests acquired as of the date the investment agreements were entered into as determined by an independent third party appraisal that we obtained.

Other

We are entitled to receive fees for providing management, leasing, construction supervision and asset management services to certain of our joint ventures as further described in Note 6, "Investments in Unconsolidated Joint Ventures." Amounts due from joint ventures and related parties at September 30, 2020 and December 31, 2019 consisted of the following (in thousands):


	September 30, 2020		December 31, 2019
Due from joint ventures	$	24,912	$	9,352
Other	7,024		11,769
Related party receivables	$	31,936	$	21,121

11. Noncontrolling Interests on the Company's Consolidated Financial Statements

Noncontrolling interests represent the common and preferred units of limited partnership interest in the Operating Partnership not held by the Company as well as third party equity interests in our other consolidated subsidiaries. Noncontrolling interests in the Operating Partnership are shown in the mezzanine equity while the noncontrolling interests in our other consolidated subsidiaries are shown in the equity section of the Company’s consolidated financial statements.

Common Units of Limited Partnership Interest in the Operating Partnership

As of September 30, 2020 and December 31, 2019, the noncontrolling interest unit holders owned 5.23%, or 4,027,317 units, and 5.03%, or 4,195,875 units, of the Operating Partnership, respectively. As of September 30, 2020, 4,027,317 shares of our common stock were reserved for issuance upon the redemption of units of limited partnership interest of the Operating Partnership.

Noncontrolling interests in the Operating Partnership is recorded at the greater of its cost basis or fair market value based on the closing stock price of our common stock at the end of the reporting period.

Below is a summary of the activity relating to the noncontrolling interests in the Operating Partnership for the nine months ended September 30, 2020 and the twelve months ended December 31, 2019 (in thousands):


	September 30, 2020		December 31, 2019
Balance at beginning of period	$	409,862	$	387,805
Distributions	(8,857)		(14,729)
Issuance of common units	7,976		19,403
Redemption and conversion of common units	(27,657)		(27,962)
Net income	10,073		13,301
Accumulated other comprehensive loss allocation	(2,664)		(2,276)
Fair value adjustment	(35,253)		34,320
Balance at end of period	$	353,480	$	409,862

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

Preferred Units of Limited Partnership Interest in the Operating Partnership

Below is a summary of the preferred units of limited partnership interest in the Operating Partnership as of September 30, 2020:


Issuance	Number of Units Authorized	Number of Units Issued	Number of Units Outstanding	Annual Dividend Per Unit(1)		Liquidation Preference Per Unit(2)		Conversion Price Per Unit(3)		Date of Issuance
3.50% Series A (4)	109,161	109,161	109,161	$	35.0000	$	1,000.00	$	—	August 2015
7.00% Series F	60	60	60	$	70.0000	$	1,000.00	$	29.12	January 2007
4.50% Series G (5)	1,902,000	1,902,000	863,972	$	1.1250	$	25.00	$	88.50	January 2012
3.50% Series K	700,000	563,954	341,677	$	0.8750	$	25.00	$	134.67	August 2014
4.00% Series L	500,000	378,634	372,634	$	1.0000	$	25.00	—		August 2014
3.75% Series M	1,600,000	1,600,000	96,357	$	0.9375	$	25.00	—		February 2015
4.00% Series P	200,000	200,000	200,000	$	1.0000	$	25.00	—		July 2015
3.50% Series Q	268,000	268,000	268,000	$	0.8750	$	25.00	$	148.95	July 2015
3.50% Series R	400,000	400,000	400,000	$	0.8750	$	25.00	$	154.89	August 2015
4.00% Series S	1,077,280	1,077,280	1,077,280	$	1.0000	$	25.00	—		August 2015
3.50% Series V	40,000	40,000	40,000	$	0.8750	$	25.00	—		May 2019
Series W (6)	1	1	1	(6)		(6)		—		January 2020

(1)Dividends are cumulative, subject to certain provisions.

(2)Units are redeemable at any time at par for cash at the option of the unitholder unless otherwise specified.

(3)If applicable, units are convertible into a number of common units of limited partnership interest in the Operating Partnership equal to (i) the liquidation preference plus accumulated and unpaid distributions on the conversion date divided by (ii) the amount shown in the table.

(4)Issued through a consolidated subsidiary. The units are convertible on a one-for-one basis, into the Series B Preferred Units of limited partnership interest, or the Subsidiary Series B Preferred Units. The Subsidiary Series B Preferred Units can be converted at any time, at the option of the unitholder, into a number of common stock equal to 6.71348 shares of common stock for each Subsidiary Series B Preferred Unit. As of September 30, 2020, no Subsidiary Series B Preferred Units have been issued.

(5)Common units of limited partnership interest in the Operating Partnership issued in a conversion may be redeemed in exchange for our common stock on a 1-to-1 basis. The Series G Preferred Units also provide the holder with the right to require the Operating Partnership to repurchase the Series G Preferred Units for cash before January 31, 2022.

(6)The Series W preferred unit was issued in January 2020 in exchange for the then-outstanding Series O preferred unit. The holder of the Series W preferred unit is entitled to quarterly dividends in an amount calculated as (i) 1,350 multiplied by (ii) the current distribution per common unit of limited partnership in SL Green Operating Partnership. The holder has the right to require the Operating Partnership to repurchase the Series W unit for cash, or convert the Series W unit for Class B units, in each case at a price that is determined based on the closing price of the Company's common stock at the time such right is exercised. The unit's liquidation preference is the fair market value of the unit plus accrued distributions at the time of a liquidation event.

Below is a summary of the activity relating to the preferred units in the Operating Partnership for the nine months ended September 30, 2020 and the twelve months ended December 31, 2019 (in thousands):


	September 30, 2020		December 31, 2019
Balance at beginning of period	$	283,285	$	300,427
Issuance of preferred units	—		1,000
Redemption of preferred units	(82,750)		(18,142)
Accrued dividends on preferred units	1,634		—
Balance at end of period	$	202,169	$	283,285

12. Stockholders’ Equity of the Company

Common Stock

Our authorized capital stock consists of 260,000,000 shares, $0.01 par value per share, consisting of 160,000,000 shares of common stock, $0.01 par value per share, 75,000,000 shares of excess stock, at $0.01 par value per share, and 25,000,000 shares of preferred stock, par value $0.01 per share. As of September 30, 2020, 73,040,291 shares of common stock and no shares of excess stock were issued and outstanding.

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

Share Repurchase Program

In August 2016, our Board of Directors approved a share repurchase program under which we can buy up to $1.0 billion of shares of our common stock. The Board of Directors has since authorized four separate $500.0 million increases to the size of the share repurchase program in the fourth quarter of 2017, second quarter of 2018, fourth quarter of 2018, and fourth quarter of 2019 bringing the total program size to $3.0 billion.

At September 30, 2020, repurchases executed under the program were as follows:


Period	Shares repurchased	Average price paid per share	Cumulative number of shares repurchased as part of the repurchase plan or programs
Year ended 2017	8,342,411	$101.64	8,342,411
Year ended 2018	9,744,911	$96.22	18,087,322
Year ended 2019	4,596,171	$83.62	22,683,493
Nine months ended September 30, 2020 (1)	6,243,165	$62.77	28,926,658

(1) Includes 216,101 shares of common stock repurchased by the Company in September 2020 that were settled in October 2020.

Perpetual Preferred Stock

We have 9,200,000 shares of our 6.50% Series I Cumulative Redeemable Preferred Stock, or the Series I Preferred Stock, outstanding with a mandatory liquidation preference of $25.00 per share. The Series I Preferred stockholders receive annual dividends of $1.625 per share paid on a quarterly basis and dividends are cumulative, subject to certain provisions. We are entitled to redeem the Series I Preferred Stock at par for cash at our option. In August 2012, we received $221.9 million in net proceeds from the issuance of the Series I Preferred Stock, which were recorded net of underwriters' discount and issuance costs, and contributed the net proceeds to the Operating Partnership in exchange for 9,200,000 units of 6.50% Series I Cumulative Redeemable Preferred Units of limited partnership interest, or the Series I Preferred Units.

Dividend Reinvestment and Stock Purchase Plan ("DRSPP")

In February 2018, the Company filed a registration statement with the SEC for our dividend reinvestment and stock purchase plan, or DRSPP, which automatically became effective upon filing. The Company registered 3,500,000 shares of our common stock under the DRSPP. The DRSPP commenced on September 24, 2001.

The following table summarizes SL Green common stock issued, and proceeds received from dividend reinvestments and/or stock purchases under the DRSPP for the three and nine months ended September 30, 2020 and 2019, respectively (dollars in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Shares of common stock issued	4,205		490		9,884		3,485
Dividend reinvestments/stock purchases under the DRSPP	$	202	$	39	$	566	$	303

Earnings per Share

We use the two-class method of computing earnings per share (“EPS”), which is an earnings allocation formula that determines EPS for common stock and any participating securities according to dividends declared (whether paid or unpaid). Under the two-class method, basic EPS is computed by dividing the income available to common stockholders by the weighted-average number of common stock shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur from share equivalent activity.

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

SL Green's earnings per share for the three and nine months ended September 30, 2020 and 2019 are computed as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
Numerator	2020		2019		2020		2019
Basic Earnings:
Income attributable to SL Green common stockholders	$	13,859	$	33,157	$	185,104	$	238,052
Less: distributed earnings allocated to participating securities	(333)		(108)		(777)		(325)
Less: undistributed earnings allocated to participating securities	—		—		(141)		(41)
Net income attributable to SL Green common stockholders (numerator for basic earnings per share)	$	13,526	$	33,049	$	184,186	$	237,686
Add back: dilutive effect of earnings allocated to participating securities	333		108		777		325
Add back: undistributed earnings allocated to participating securities	—		—		141		41
Add back: effect of dilutive securities (redemption of units to common shares)	802		1,719		10,073		12,306
Income attributable to SL Green common stockholders (numerator for diluted earnings per share)	$	14,661	$	34,876	$	195,177	$	250,358


	Three Months Ended September 30,		Nine Months Ended September 30,
Denominator	2020	2019	2020	2019
Basic Shares:
Weighted average common stock outstanding	73,020	82,292	75,521	82,855
Effect of Dilutive Securities:
Operating Partnership units redeemable for common shares	4,029	4,258	4,123	4,283
Stock-based compensation plans	442	164	441	171
Diluted weighted average common stock outstanding	77,491	86,714	80,085	87,309

The Company has excluded 2,131,606 and 1,779,212 common stock equivalents from the calculation of diluted shares outstanding for the three and nine months ended September 30, 2020, respectively, as they were anti-dilutive. The Company has excluded 1,317,803 and 1,266,296 common stock equivalents from the calculation of diluted shares outstanding for the three and nine months ended September 30, 2019, respectively, as they were anti-dilutive.

13. Partners' Capital of the Operating Partnership

The Company is the sole managing general partner of the Operating Partnership and at September 30, 2020 owned 73,040,291 general and limited partnership interests in the Operating Partnership and 9,200,000 Series I Preferred Units. Partnership interests in the Operating Partnership are denominated as “common units of limited partnership interest” (also referred to as “OP Units”) or “preferred units of limited partnership interest” (also referred to as “Preferred Units”). All references to OP Units and Preferred Units outstanding exclude such units held by the Company. A holder of an OP Unit may present such OP Unit to the Operating Partnership for redemption at any time (subject to restrictions agreed upon at the issuance of OP Units to particular holders that may restrict such right for a period of time, generally one year from issuance). Upon presentation of an OP Unit for redemption, the Operating Partnership must redeem such OP Unit in exchange for the cash equal to the then value of a share of common stock of the Company, except that the Company may, at its election, in lieu of cash redemption, acquire such OP Unit for one share of common stock. Because the number of shares of common stock outstanding at all times equals the number of OP Units that the Company owns, one share of common stock is generally the economic equivalent of one OP Unit, and the quarterly distribution that may be paid to the holder of an OP Unit equals the quarterly dividend that may be paid to the holder of a share of common stock. Each series of Preferred Units makes a distribution that is set in accordance with an amendment to the partnership agreement of the Operating Partnership. Preferred Units may also be convertible into OP Units at the election of the holder thereof or the Company, subject to the terms of such Preferred Units.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

Net income (loss) allocated to the preferred unitholders and common unitholders reflects their pro rata share of net income (loss) and distributions.

Limited Partner Units

As of September 30, 2020, limited partners other than SL Green owned 5.23%, or 4,027,317 common units, of the Operating Partnership.

Preferred Units

Preferred units not owned by SL Green are further described in Note 11, “Noncontrolling Interests on the Company’s Consolidated Financial Statements - Preferred Units of Limited Partnership Interest in the Operating Partnership.”

Earnings per Unit

The Operating Partnership's earnings per unit for the three and nine months ended September 30, 2020 and 2019, respectively, are computed as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
Numerator	2020		2019		2020		2019
Basic Earnings:
Income attributable to SLGOP common unitholders	$	14,661	$	34,876	$	195,177	$	250,358
Less: distributed earnings allocated to participating securities	(333)		(108)		(777)		(325)
Less: undistributed earnings allocated to participating securities	—		—		(141)		(41)
Net Income attributable to SLGOP common unitholders (numerator for basic earnings per unit)	$	14,328	$	34,768	$	194,259	$	249,992
Add back: dilutive effect of earnings allocated to participating securities	333		108		777		325
Add back: undistributed earnings allocated to participating securities	—		—		141		41
Income attributable to SLGOP common unitholders (numerator for diluted earnings per unit)	$	14,661	$	34,876	$	195,177	$	250,358


	Three Months Ended September 30,		Nine Months Ended September 30,
Denominator	2020	2019	2020	2019
Basic units:
Weighted average common units outstanding	77,049	86,550	79,644	87,138
Effect of Dilutive Securities:
Stock-based compensation plans	442	164	441	171
Diluted weighted average common units outstanding	77,491	86,714	80,085	87,309

The Operating Partnership has excluded 2,131,606 and 1,779,212 common unit equivalents from the diluted units outstanding for the three and nine months ended September 30, 2020, respectively, as they were anti-dilutive. The Operating Partnership has excluded 1,317,803 and 1,266,296 common unit equivalents from the diluted units outstanding for the three and nine months ended September 30, 2019, respectively, as they were anti-dilutive.

14. Share-based Compensation

We have share-based employee and director compensation plans. Our employees are compensated through the Operating Partnership. Under each plan, whenever the Company issues common or preferred stock, the Operating Partnership issues an equivalent number of units of limited partnership interest of a corresponding class to the Company.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

The Fourth Amended and Restated 2005 Stock Option and Incentive Plan, or the 2005 Plan, was approved by the Company's board of directors in April 2016 and its stockholders in June 2016 at the Company's annual meeting of stockholders. The 2005 Plan authorizes the issuance of stock options, stock appreciation rights, unrestricted and restricted stock, phantom shares, dividend equivalent rights, cash-based awards and other equity-based awards. Subject to adjustments upon certain corporate transactions or events, awards with respect to up to a maximum of 27,030,000 fungible units may be granted under the 2005 Plan. Currently, different types of awards count against the limit on the number of fungible units differently, with (1) full-value awards (i.e., those that deliver the full value of the award upon vesting, such as restricted stock) counting as 3.74 Fungible Units per share subject to such awards, (2) stock options, stock appreciation rights and other awards that do not deliver full value and expire five years from the date of grant counting as 0.73 fungible units per share subject to such awards, and (3) all other awards (e.g., ten-year stock options) counting as 1.0 fungible units per share subject to such awards. Awards granted under the 2005 Plan prior to the approval of the fourth amendment and restatement in June 2016 continue to count against the fungible unit limit based on the ratios that were in effect at the time such awards were granted, which may be different than the current ratios. As a result, depending on the types of awards issued, the 2005 Plan may result in the issuance of more or less than 27,030,000 shares. If a stock option or other award granted under the 2005 Plan expires or terminates, the common stock subject to any portion of the award that expires or terminates without having been exercised or paid, as the case may be, will again become available for the issuance of additional awards. Shares of our common stock distributed under the 2005 Plan may be treasury shares or authorized but unissued shares. Currently, unless the 2005 Plan has been previously terminated by the Company's board of directors, new awards may be granted under the 2005 Plan until June 2, 2026, which is the tenth anniversary of the date that the 2005 Plan was most recently approved by the Company's stockholders. As of September 30, 2020, 3.4 million fungible units were available for issuance under the 2005 Plan after reserving for shares underlying outstanding restricted stock units, phantom stock units granted pursuant to our Non-Employee Directors' Deferral Program and LTIP Units.

Stock Options and Class O LTIP Units

Options are granted with an exercise price at the fair market value of the Company's common stock on the date of grant and, subject to employment, generally expire five years or ten years from the date of grant, are not transferable other than on death, and generally vest in one year to five years commencing one year from the date of grant. We have also granted Class O LTIP Units, which are a class of LTIP Units in the Operating Partnership structured to provide economics similar to those of stock options. Class O LTIP Units, once vested, may be converted, at the election of the holder, into a number of common units of the Operating Partnership per Class O LTIP Unit determined by the increase in value of a share of the Company’s common stock at the time of conversion over a participation threshold, which equals the fair market value of a share of the Company’s common stock at the time of grant. Class O LTIP Units are entitled to distributions, subject to vesting, equal per unit to 10% of the per unit distributions paid with respect to the common units of the Operating Partnership. The fair value of each stock option or LTIP Unit granted is estimated on the date of grant using the Black-Scholes option pricing model based on historical information.

There were no options granted during the nine months ended September 30, 2020 or the year ended December 31, 2019.

A summary of the status of the Company's stock options as of September 30, 2020 and December 31, 2019, and changes during the nine months ended September 30, 2020 and year ended December 31, 2019 are as follows:


	September 30, 2020			December 31, 2019
	Options Outstanding	Weighted Average Exercise Price		Options Outstanding	Weighted Average Exercise Price
Balance at beginning of period	1,037,068	$	102.36	1,137,017	$	103.54
Granted	—	—		—	—
Exercised	—	—		—	—
Lapsed or canceled	(53,700)	111.18		(99,949)	115.81
Balance at end of period	983,368	$	101.88	1,037,068	$	102.36
Options exercisable at end of period	982,368	$	101.88	914,929	$	101.69

The remaining weighted average contractual life of the options outstanding was 2.0 years and the remaining average contractual life of the options exercisable was 2.0 years.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

During the three and nine months ended September 30, 2020, we recognized compensation expense for these options of $0.00 million and $0.03 million, respectively. During the three and nine months ended September 30, 2019, we recognized compensation expense for these options of $0.6 million and $1.8 million, respectively.

As of September 30, 2020, there was $0.01 million of total unrecognized compensation cost related to unvested stock options, which is expected to be recognized over a weighted average period of 0.5 years.

Restricted Shares

Shares are granted to certain employees, including our executives, and vesting occurs annually upon the completion of a service period or our meeting established financial performance criteria. Annual vesting occurs at rates ranging from 15% to 35% once performance criteria are reached.

A summary of the Company's restricted stock as of September 30, 2020 and December 31, 2019 and charges during the nine months ended September 30, 2020 and the year ended December 31, 2019, are as follows:


	September 30, 2020		December 31, 2019
Balance at beginning of period	3,566,466		3,452,016
Granted	9,220		126,350
Canceled	(26,043)		(11,900)
Balance at end of period	3,549,643		3,566,466
Vested during the period	132,652		113,259
Compensation expense recorded	$	8,528,991	$	12,892,249
Total fair value of restricted stock granted during the period	$	734,315	$	11,131,181

The fair value of restricted stock that vested during the nine months ended September 30, 2020 and the year ended December 31, 2019 was $12.5 million and $12.1 million, respectively. As of September 30, 2020, there was $11.0 million of total unrecognized compensation cost related to restricted stock, which is expected to be recognized over a weighted average period of 1.5 years.

We granted LTIP Units, which include bonus, time-based and performance-based awards, with a fair value of $33.7 million and $58.3 million as of September 30, 2020 and December 31, 2019, respectively. The grant date fair value of the LTIP Unit awards was calculated in accordance with ASC 718. A third party consultant determined the fair value of the LTIP Units to have a discount from our common stock price. The discount was calculated by considering the inherent uncertainty that the LTIP Units will reach parity with other common partnership units and the illiquidity due to transfer restrictions. As of September 30, 2020, there was $41.8 million of total unrecognized compensation expense related to the time-based and performance based awards, which is expected to be recognized over a weighted average period of 2.0 years.

During the three and nine months ended September 30, 2020, we recorded compensation expense related to bonus, time-based and performance based awards of $6.4 million and $20.4 million, respectively. During the three and nine months ended September 30, 2019, we recorded compensation expense related to bonus, time-based and performance based awards of $3.0 million and $14.0 million, respectively.

For the three and nine months ended September 30, 2020, $0.6 million and $1.7 million, respectively, was capitalized to assets associated with compensation expense related to our long-term compensation plans, restricted stock and stock options. For the three and nine months ended September 30, 2019, $0.5 million and $1.4 million, respectively, was capitalized to assets associated with compensation expense related to our long-term compensation plans, restricted stock and stock options.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

Deferred Compensation Plan for Directors

Under our Non-Employee Director's Deferral Program, which commenced July 2004, the Company's non-employee directors may elect to defer up to 100% of their annual retainer fee, chairman fees, meeting fees and annual stock grant. Unless otherwise elected by a participant, fees deferred under the program shall be credited in the form of phantom stock units. The program provides that a director's phantom stock units generally will be settled in an equal number of shares of common stock upon the earlier of (i) the January 1 coincident with or the next following such director's termination of service from the Board of Directors or (ii) a change in control by us, as defined by the program. Phantom stock units are credited to each non-employee director quarterly using the closing price of our common stock on the first business day of the respective quarter. Each participating non-employee director is also credited with dividend equivalents or phantom stock units based on the dividend rate for each quarter, which are either paid in cash currently or credited to the director’s account as additional phantom stock units.

During the nine months ended September 30, 2020, 18,167 phantom stock units and 8,285 shares of common stock were issued to our board of directors. We recorded compensation expense of $0.2 million and $2.1 million during the three and nine months ended September 30, 2020, respectively, related to the Deferred Compensation Plan. We recorded compensation expense of $0.2 million and $2.2 million during the three and nine months ended September 30, 2019, respectively, related to the Deferred Compensation Plan.

As of September 30, 2020, there were 138,189 phantom stock units outstanding pursuant to our Non-Employee Director's Deferral Program.

Employee Stock Purchase Plan

In 2007, the Company's board of directors adopted the 2008 Employee Stock Purchase Plan, or ESPP, to encourage our employees to make our business more successful by providing equity-based incentives to eligible employees. The ESPP is intended to qualify as an "employee stock purchase plan" under Section 423 of the Code, and has been adopted by the board to enable our eligible employees to purchase the Company's shares of common stock through payroll deductions. The ESPP became effective on January 1, 2008 with a maximum of 500,000 shares of the common stock available for issuance, subject to adjustment upon a merger, reorganization, stock split or other similar corporate change. The Company filed a registration statement on Form S-8 with the SEC with respect to the ESPP. The common stock is offered for purchase through a series of successive offering periods. Each offering period will be three months in duration and will begin on the first day of each calendar quarter, with the first offering period having commenced on January 1, 2008. The ESPP provides for eligible employees to purchase the common stock at a purchase price equal to 85% of the lesser of (1) the market value of the common stock on the first day of the offering period or (2) the market value of the common stock on the last day of the offering period. The ESPP was approved by our stockholders at our 2008 annual meeting of stockholders. As of September 30, 2020, 152,690 shares of our common stock had been issued under the ESPP.

15. Accumulated Other Comprehensive Loss

The following tables set forth the changes in accumulated other comprehensive loss by component as of September 30, 2020 (in thousands):


	Net unrealized loss on derivative instruments (1)		SL Green’s share of joint venture net unrealized loss on derivative instruments (2)		Net unrealized gain (loss) on marketable securities		Total
Balance at December 31, 2019	$	(22,780)	$	(7,982)	$	2,277	$	(28,485)
Other comprehensive loss before reclassifications	(50,038)		(7,954)		(2,047)		(60,039)
Amounts reclassified from accumulated other comprehensive loss	9,120		3,204		—		12,324
Balance at September 30, 2020	$	(63,698)	$	(12,732)	$	230	$	(76,200)

(1)Amount reclassified from accumulated other comprehensive loss is included in interest expense in the respective consolidated statements of operations. As of September 30, 2020 and December 31, 2019, the deferred net gains from these terminated hedges, which is included in accumulated other comprehensive loss relating to net unrealized (loss) gain on derivative instrument, was $(0.5) million and $(0.7) million, respectively.

(2)Amount reclassified from accumulated other comprehensive loss is included in equity in net loss from unconsolidated joint ventures in the respective consolidated statements of operations.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

16. Fair Value Measurements

We are required to disclose fair value information with regard to our financial instruments, whether or not recognized in the consolidated balance sheets, for which it is practical to estimate fair value. The FASB guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. We measure and/or disclose the estimated fair value of financial assets and liabilities based on a hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity and the reporting entity’s own assumptions about market participant assumptions. This hierarchy consists of three broad levels: Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date; Level 2 - inputs other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly; and Level 3 - unobservable inputs for the asset or liability that are used when little or no market data is available. We follow this hierarchy for our assets and liabilities measured at fair value on a recurring and nonrecurring basis. In instances in which the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level of input that is significant to the fair value measurement in its entirety. Our assessment of the significance of the particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

The following tables set forth the assets and liabilities that we measure at fair value on a recurring and non-recurring basis by their levels in the fair value hierarchy at September 30, 2020 and December 31, 2019 (in thousands):


	September 30, 2020
	Total		Level 1		Level 2		Level 3
Assets:
Marketable securities	$	27,734	$	—	$	27,734	$	—
Interest rate cap and swap agreements (included in other assets)	$	39	$	—	$	39	$	—
Liabilities:
Interest rate cap and swap agreements (included in other liabilities)	$	67,680	$	—	$	67,680	$	—


	December 31, 2019
	Total		Level 1		Level 2		Level 3
Assets:
Marketable securities	$	29,887	$	—	$	29,887	$	—
Interest rate cap and swap agreements (included in other assets)	$	4,419	$	—	$	4,419	$	—
Liabilities:
Interest rate cap and swap agreements (included in other liabilities)	$	29,110	$	—	$	29,110	$	—

We evaluate real estate investments and debt and preferred equity investments, including intangibles, for potential impairment primarily utilizing cash flow projections that apply, among other things, estimated revenue and expense growth rates, discount rates and capitalization rates, as well as sales comparison approach, which utilizes comparable sales, listings and sales contracts. All of which are classified as Level 3 inputs.

Marketable securities classified as Level 1 are derived from quoted prices in active markets. The valuation technique used to measure the fair value of marketable securities classified as Level 2 were valued based on quoted market prices or model driven valuations using the significant inputs derived from or corroborated by observable market data. Marketable securities in an unrealized loss position are not considered to be other than temporarily impaired. We do not intend to sell these securities and it is not more likely than not that we will be required to sell the investments before recovery of their amortized cost bases.

The fair value of derivative instruments is based on current market data received from financial sources that trade such instruments and are based on prevailing market data and derived from third party proprietary models based on well-recognized financial principles and reasonable estimates about relevant future market conditions, which are classified as Level 2 inputs.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

The financial assets and liabilities that are not measured at fair value on our consolidated balance sheets include cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued expenses, debt and preferred equity investments, mortgages and other loans payable and other secured and unsecured debt. The carrying amount of cash and cash equivalents, restricted cash, accounts receivable, and accounts payable and accrued expenses reported in our consolidated balance sheets approximates fair value due to the short-term nature of these instruments. The fair value of debt and preferred equity investments, which is classified as Level 3, is estimated by discounting the future cash flows using current interest rates at which similar loans with the same maturities would be made to borrowers with similar credit ratings. The fair value of borrowings, which is classified as Level 3, is estimated by discounting the contractual cash flows of each debt instrument to their present value using adjusted market interest rates, which is provided by a third-party specialist.

The following table provides the carrying value and fair value of these financial instruments as of September 30, 2020 and December 31, 2019 (in thousands):


	September 30, 2020				December 31, 2019
	Carrying Value (1)		Fair Value		Carrying Value (1)		Fair Value

Debt and preferred equity investments	$	1,153,363	(2)		$	1,580,306	(2)

Fixed rate debt	$	3,338,268	$	3,427,731	$	3,536,286	$	3,642,770
Variable rate debt	2,128,581		2,112,589		2,018,434		2,018,714
	$	5,466,849	$	5,540,320	$	5,554,720	$	5,661,484

(1)Amounts exclude net deferred financing costs.

(2)At September 30, 2020, debt and preferred equity investments had an estimated fair value ranging between $1.04 billion and $1.15 billion. At December 31, 2019, debt and preferred equity investments had an estimated fair value ranging between $1.58 billion and $1.74 billion.

Disclosure about fair value of financial instruments was based on pertinent information available to us as of September 30, 2020 and December 31, 2019. Such amounts have not been comprehensively revalued for purposes of these financial statements since that date and current estimates of fair value may differ significantly from the amounts presented herein.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

17. Financial Instruments: Derivatives and Hedging

In the normal course of business, we use a variety of commonly used derivative instruments, such as interest rate swaps, caps, collar and floors, to manage, or hedge interest rate risk. We hedge our exposure to variability in future cash flows for forecasted transactions in addition to anticipated future interest payments on existing debt. We recognize all derivatives on the balance sheet at fair value. Derivatives that are not hedges are adjusted to fair value through earnings. If a derivative is a hedge, depending on the nature of the hedge, changes in the fair value of the derivative will either be offset against the change in fair value of the hedge asset, liability, or firm commitment through earnings, or recognized in other comprehensive income (loss) until the hedged item is recognized in earnings. Reported net income and equity may increase or decrease prospectively, depending on future levels of interest rates and other variables affecting the fair values of derivative instruments and hedged items, but will have no effect on cash flows. Currently, all of our designated derivative instruments are effective hedging instruments.

The following table summarizes the notional value at inception and fair value of our consolidated derivative financial instruments at September 30, 2020 based on Level 2 information. The notional value is an indication of the extent of our involvement in these instruments at that time, but does not represent exposure to credit, interest rate or market risks (dollars in thousands).


	Notional Value		Strike Rate		Effective Date	Expiration Date	Balance Sheet Location	Fair Value
Interest Rate Swap	$	100,000	1.928	%	December 2017	November 2020	Other Liabilities	$	(295)
Interest Rate Swap	100,000		1.934	%	December 2017	November 2020	Other Liabilities	(296)
Interest Rate Cap	111,869		3.500	%	December 2019	December 2020	Other Assets	—
Interest Rate Cap	85,000		4.000	%	March 2019	March 2021	Other Assets	—
Interest Rate Swap	350,000		0.544	%	April 2020	August 2021	Other Liabilities	(978)
Interest Rate Cap	510,000		3.000	%	June 2020	December 2021	Other Assets	1
Interest Rate Swap	200,000		1.131	%	July 2016	July 2023	Other Liabilities	(5,599)
Interest Rate Swap	100,000		1.161	%	July 2016	July 2023	Other Liabilities	(2,883)
Interest Rate Cap	600,000		4.000	%	August 2020	September 2023	Other Assets	38
Interest Rate Swap	150,000		2.696	%	January 2019	January 2024	Other Liabilities	(12,430)
Interest Rate Swap	150,000		2.721	%	January 2019	January 2026	Other Liabilities	(19,286)
Interest Rate Swap	200,000		2.740	%	January 2019	January 2026	Other Liabilities	(25,913)
								$	(67,641)

No gains or losses on the changes in the fair values were included in interest expense in the consolidated statements of operations during the three months ended September 30, 2020 or 2019. No gains or losses on the changes in the fair values were included in interest expense in the consolidated statements of operations during the nine months ended September 30, 2020 or 2019.

The Company has agreements with each of its derivative counterparties that contain a provision where if the Company defaults on any of its indebtedness, then the Company could also be declared in default on its derivative obligations. As of September 30, 2020, the fair value of derivatives in a net liability position, including accrued interest but excluding any adjustment for nonperformance risk related to these agreements, was $68.9 million. As of September 30, 2020, the Company has not posted any collateral related to these agreements and was not in breach of any agreement provisions. If the Company had breached any of these provisions, it could have been required to settle its obligations under the agreements at their aggregate termination value of $70.2 million at September 30, 2020.

Gains and losses on terminated hedges are included in accumulated other comprehensive income (loss), and are recognized into earnings over the term of the related mortgage obligation. Over time, the realized and unrealized gains and losses held in accumulated other comprehensive loss will be reclassified into earnings as an adjustment to interest expense in the same periods in which the hedged interest payments affect earnings. We estimate that $17.7 million of the current balance held in accumulated other comprehensive loss will be reclassified into interest expense and $7.4 million of the portion related to

Table of Contents

SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

our share of joint venture accumulated other comprehensive loss will be reclassified into equity in net loss from unconsolidated joint ventures within the next 12 months.

The following table presents the effect of our derivative financial instruments and our share of our joint ventures' derivative financial instruments that are designated and qualify as hedging instruments on the consolidated statements of operations for the three months ended September 30, 2020 and 2019, respectively (in thousands):


	Amount of Loss Recognized in Other Comprehensive Loss				Location of Loss Reclassified from Accumulated Other Comprehensive Loss into Income	Amount of Loss Reclassified from Accumulated Other Comprehensive Loss into Income
	Three Months Ended September 30,					Three Months Ended September 30,
Derivative	2020		2019				2020		2019
Interest Rate Swaps/Caps	$	(318)	$	(10,169)		Interest expense	$	(5,162)	$	(105)
Share of unconsolidated joint ventures' derivative instruments	(199)		(2,437)			Equity in net loss from unconsolidated joint ventures	(1,454)		(192)
	$	(517)	$	(12,606)			$	(6,616)	$	(297)

The following table presents the effect of our derivative financial instruments and our share of our joint ventures' derivative financial instruments that are designated and qualify as hedging instruments on the consolidated statements of operations for the nine months ended September 30, 2020 and 2019, respectively (in thousands):


	Amount of Loss Recognized in Other Comprehensive Loss				Location of (Loss) Gain Reclassified from Accumulated Other Comprehensive Loss into Income	Amount of (Loss) Gain Reclassified from Accumulated Other Comprehensive Loss into Income
	Nine Months Ended September 30,					Nine Months Ended September 30,
Derivative	2020		2019				2020		2019
Interest Rate Swaps/Caps	$	(52,808)	$	(43,008)		Interest expense	$	(9,610)	$	886
Share of unconsolidated joint ventures' derivative instruments	(8,375)		(11,963)			Equity in net loss from unconsolidated joint ventures	(3,347)		713
	$	(61,183)	$	(54,971)			$	(12,957)	$	1,599

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

18. Rental Income

The Operating Partnership is the lessor and the sublessor to tenants under operating and sales-type leases. The minimum rental amounts due under the leases are generally subject to scheduled fixed increases or adjustments. The leases generally also require that the tenants reimburse us for increases in certain operating costs and real estate taxes above their base year costs.

The components of operating lease revenues were as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Fixed lease payments	$	171,866	$	214,282	$	538,601	$	641,007
Variable lease payments	21,979		32,581		70,892		88,539
Total lease payments	$	193,845	$	246,863	$	609,493	$	729,546
Amortization of acquired above and below-market leases	1,670		1,165		4,539		3,559
Total rental revenue	$	195,515	$	248,028	$	614,032	$	733,105

The components of sales-type lease revenues were as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Loss recognized at commencement, net(1)	$	(5,973)	$	—	$	(5,973)	$	—
Interest income(2)	484		—		484		—
Total loss recognized on sales-type leases	$	(5,489)	$	—	$	(5,489)	$	—

(1)These amounts are included in gain on sale of real estate, net and depreciable real estate reserves and impairment in our consolidated statements of operations.

(2)These amounts are included in other income in our consolidated statements of operations.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

19. Commitments and Contingencies

Legal Proceedings

As of September 30, 2020, the Company and the Operating Partnership were not involved in any material litigation nor, to management's knowledge, was any material litigation threatened against us or our portfolio which if adversely determined could have a material adverse impact on us.

Environmental Matters

Our management believes that the properties are in compliance in all material respects with applicable Federal, state and local ordinances and regulations regarding environmental issues. Management is not aware of any environmental liability that it believes would have a materially adverse impact on our financial position, results of operations or cash flows. Management is unaware of any instances in which it would incur significant environmental cost if any of our properties were sold.

Ground Lease Arrangements

We are a tenant under ground leases for certain properties. These leases have expirations from 2022 to 2119, or 2043 to 2119 as fully extended. Certain leases offer extension options which we assess against relevant economic factors to determine whether we are reasonably certain of exercising or not exercising the option. Lease payments associated with renewal periods that we are reasonably certain will be exercised, if any, are included in the measurement of the corresponding lease liability and right of use asset.

Certain of our ground leases are subject to rent resets, generally based on a percentage of the then fair market value, a fixed amount, or a percentage of the preceding rent at specified future dates. Rent resets will be recognized in the periods in which they are incurred.

The table below summarizes our current ground lease arrangements as of September 30, 2020:


Property (1)	Year of Current Expiration	Year of Final Expiration (2)
1185 Avenue of the Americas	2043	2043
625 Madison Avenue	2022	2054
420 Lexington Avenue	2050	2080
711 Third Avenue (3)	2033	2083
461 Fifth Avenue (4)	2027	2084
1055 Washington Blvd, Stamford, Connecticut	2090	2090
1080 Amsterdam Avenue (5)	2111	2111
30 East 40th Street (5)	2114	2114
126 Nassau Street (4)(6)	2119	2119
Other	Various	Various

(1)All leases are classified as operating leases unless otherwise specified.

(2)Reflects exercise of all available renewal options.

(3)The Company owns 50% of the fee interest.

(4)The Company has an option to purchase the ground lease for a fixed price on a specific date. The lease is classified as a financing lease.

(5)A portion of the lease is classified as a financing lease.

(6)In August 2020, the Company entered into a long-term sublease with an unconsolidated joint venture as part of the capitalization of the 126 Nassau Street development project. See Note 6, "Investments in Unconsolidated Joint Ventures."

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

The following is a schedule of future minimum lease payments as evaluated in accordance with ASC 842 for our financing leases and operating leases with initial terms in excess of one year as of September 30, 2020 (in thousands):


	Financing leases		Operating leases (1)
Remaining 2020	$	1,974	$	7,363
2021	34,885		29,452
2022	5,881		27,148
2023	5,927		24,844
2024	5,999		24,863
2025	6,266		24,962
Thereafter	1,018,013		618,326
Total minimum lease payments	$	1,078,945	$	756,958
Amount representing interest	(903,962)
Amount discounted using incremental borrowing rate			(398,539)

Lease liabilities	$	174,983	$	358,419

(1)As of September 30, 2020, the total future minimum payments to be received under non-cancelable subleases is $1.7 billion.

The following table provides lease cost information for the Company's operating and financing leases for the three and nine months ended September 30, 2020 and 2019 (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Operating Lease Costs
Operating lease costs before capitalized operating lease costs	$	7,751	$	8,315	$	24,486	$	24,918
Operating lease costs capitalized	(778)		(20)		(2,315)		(27)
Operating lease costs, net (1)	6,973		8,295		22,171		24,891

Financing Lease Costs
Interest on financing leases before capitalized interest	2,198		813		6,010		2,425
Interest on financing leases capitalized	(588)		—		(2,378)		—
Interest on financing leases, net (2)	1,610		813		3,632		2,425
Amortization of right-of-use assets (3)	304		304		914		914


Financing lease costs, net	1,914		1,117		4,546		3,339

(1)This amount is included in operating lease rent in our consolidated statements of operations.

(2)These amounts are included in interest expense, net of interest income in our consolidated statements of operations.

(3)These amounts are included in depreciation and amortization in our consolidated statements of operations.

As of September 30, 2020, the weighted-average discount rate used to calculate the lease liabilities was 7.98%. As of September 30, 2020, the weighted-average remaining lease term was 32 years, inclusive of purchase options expected to be exercised.

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SL Green Realty Corp. and SL Green Operating Partnership, L.P.

Notes to Consolidated Financial Statements (cont.)

September 30, 2020

(unaudited)

20. Segment Information

The Company has two reportable segments, real estate and debt and preferred equity investments. We evaluate real estate performance and allocate resources based on earnings contributions.

The primary sources of revenue are generated from tenant rents and escalations and reimbursement revenue. Real estate property operating expenses consist primarily of security, maintenance, utility costs, insurance, real estate taxes and ground rent expense (at certain applicable properties). See Note 5, "Debt and Preferred Equity Investments," for additional details on our debt and preferred equity investments.

Selected consolidated results of operations for the three and nine months ended September 30, 2020 and 2019, and selected asset information as of September 30, 2020 and December 31, 2019, regarding our operating segments are as follows (in thousands):


	Real Estate Segment		Debt and Preferred Equity Segment		Total Company
Total revenues
Three months ended:
September 30, 2020	$	226,856	$	22,988	$	249,844
September 30, 2019	262,115		51,519		313,634
Nine months ended:
September 30, 2020	$	716,382	$	101,464	817,846
September 30, 2019	777,745		153,168		930,913
Net income
Three months ended:
September 30, 2020	$	10,097	$	10,580	$	20,677
September 30, 2019	6,133		34,589		40,722
Nine months ended:
September 30, 2020	$	161,388	$	53,030	214,418
September 30, 2019	168,639		98,593		267,232
Total assets
As of:
September 30, 2020	$	11,079,252	$	1,244,787	$	12,324,039
December 31, 2019	11,063,155		1,703,165		12,766,320

Interest costs for the debt and preferred equity segment include actual costs incurred for borrowings on the 2017 MRA and the FHLB Facility. Interest is imputed on the investments that do not collateralize the 2017 MRA and the FHLB Facility using our weighted average corporate borrowing cost. We also allocate loan loss reserves, net of recoveries, and transaction related costs to the debt and preferred equity segment. We do not allocate marketing, general and administrative expenses to the debt and preferred equity segment because the use of personnel and resources is dependent on transaction volume between the two segments and varies period over period. In addition, we base performance on the individual segments prior to allocating marketing, general and administrative expenses. For the three and nine months ended September 30, 2020, marketing, general and administrative expenses totaled $23.6 million and $66.7 million, respectively. For the three and nine months ended September 30, 2019, marketing, general and administrative expenses totaled $23.8 million and $75.3 million, respectively. All other expenses, except interest, relate entirely to the real estate assets.

There were no transactions between the above two segments.

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

Overview

SL Green Realty Corp., which is referred to as SL Green or the Company, a Maryland corporation, and SL Green Operating Partnership, L.P., which is referred to as SLGOP or the Operating Partnership, a Delaware limited partnership, were formed in June 1997 for the purpose of combining the commercial real estate business of S.L. Green Properties, Inc. and its affiliated partnerships and entities. The Company is a self-managed real estate investment trust, or REIT, engaged in the acquisition, development, ownership, management and operation of commercial and residential real estate properties, principally office properties, located in the New York metropolitan area. Unless the context requires otherwise, all references to "we," "our" and "us" means the Company and all entities owned or controlled by the Company, including the Operating Partnership.

The following discussion related to our consolidated financial statements should be read in conjunction with the financial statements appearing in this Quarterly Report on this Form 10-Q and in Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2019.


		Consolidated		Unconsolidated		Total
Location	Property Type	Number of Properties	Approximate Square Feet (unaudited)	Number of Properties	Approximate Square Feet (unaudited)	Number of Properties	Approximate Square Feet (unaudited)	Weighted Average Occupancy(1) (unaudited)
Commercial:
Manhattan	Office	18	10,647,191	11	11,841,483	29	22,488,674	93.1	%
	Retail	4	44,189	8	289,050	12	333,239	94.0	%
	Development/Redevelopment	10	2,908,362	2	1,755,610	12	4,663,972	N/A
	Fee Interest	—	—	1	—	1	—	—	%
		32	13,599,742	22	13,886,143	54	27,485,885	93.1	%
Suburban	Office	8	1,044,800	—	—	8	1,044,800	85.0	%
	Retail	1	52,000	—	—	1	52,000	100.0	%
	Development/Redevelopment	—	—	—	—	—	—	—	%
		9	1,096,800	—	—	9	1,096,800	85.7	%
Total commercial properties		41	14,696,542	22	13,886,143	63	28,582,685	92.7	%
Residential:
Manhattan	Residential	1	82,250	8	1,663,774	9	1,746,024	78.8	%
Total residential properties		1	82,250	8	1,663,774	9	1,746,024	78.8	%
Total portfolio		42	14,778,792	30	15,549,917	72	30,328,709	91.9	%

As of September 30, 2020, we also managed two office buildings owned by third parties encompassing approximately 2.1 million square feet (unaudited), and held debt and preferred equity investments with a book value of $1.15 billion, excluding $0.1 billion of debt and preferred equity investments and other financing receivables that are included in other balance sheet line items other than the Debt and Preferred Equity Investments line item.

Critical Accounting Policies

Refer to the 2019 Annual Report on Form 10-K of the Company and the Operating Partnership for a discussion of our critical accounting policies, which include investment in commercial real estate properties, investment in unconsolidated joint ventures, revenue recognition, reserve for possible credit losses and derivative instruments. During the three and nine months ended September 30, 2020, there were no material changes to these policies, other than the adoption of the Accounting Standards Codification Topic 326, Financial Instruments - Credit Losses, described in Note 2 - Significant Accounting Policies and Note 5 - Debt and Preferred Equity Investments to the unaudited consolidated financial statements in Part I, Item I of this Quarterly Report on Form 10-Q.

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Results of Operations

Beginning in late 2019, a novel strain of Coronavirus (“COVID-19”) began to spread throughout the world, including the United States, ultimately being declared a pandemic by the World Health Organization. The pandemic has caused, and continues to cause, severe disruptions with wide ranging impacts to the global economy and everyday life. We expect that our business, results of operations, liquidity, cash flows, prospects, and our ability to achieve forward-looking targets and expectations could be materially and adversely affected for at least the duration of the COVID-19 pandemic and possibly longer. This has also caused significant volatility in the trading prices of our securities. The extent of the impact of the COVID-19 pandemic will depend on future developments, including the duration, severity and spread of the pandemic, health and safety actions taken to contain its spread and how quickly and to what extent normal economic and operating conditions can resume. Additionally, the COVID-19 pandemic could increase the magnitude of many of the other risks described in our latest Annual Report on Form 10-K and other SEC filings and may have other adverse effects on our operations that we are not currently able to predict.

Comparison of the three months ended September 30, 2020 to the three months ended September 30, 2019

The following comparison for the three months ended September 30, 2020, or 2020, to the three months ended September 30, 2019, or 2019, makes reference to the effect of the following:

i.“Same-Store Properties,” which represents all operating properties owned by us at January 1, 2019 and still owned by us in the same manner at September 30, 2020 (Same-Store Properties totaled 30 of our 42 consolidated operating properties),

ii.“Acquisition Properties,” which represents all properties or interests in properties acquired in 2020 and 2019 and all non-Same-Store Properties, including properties that are under development or redevelopment,

iii."Disposed Properties," which represents all properties or interests in properties sold in 2020 and 2019, and

iv.“Other,” which represents properties where we sold an interest resulting in deconsolidation and corporate level items not allocable to specific properties, as well as the Service Corporation and eEmerge Inc.


	Same-Store								Disposed				Other				Consolidated
(in millions)	2020		2019		$ Change		% Change		2020		2019		2020		2019		2020		2019		$ Change		% Change

Rental revenue	$	184.3	$	193.7	$	(9.4)	(4.9)	%	$	0.5	$	18.3	$	10.7	$	36.0	$	195.5	$	248.0	$	(52.5)	(21.2)	%

Investment income	—		—		—		—	%	—		—		23.0		51.5		23.0		51.5		(28.5)		(55.3)	%
Other income	20.9		6.2		14.7		237.1	%	0.6		—		9.8		7.9		31.3		14.1		17.2		122.0	%
Total revenues	205.2		199.9		5.3		2.7	%	1.1		18.3		43.5		95.4		249.8		313.6		(63.8)		(20.3)	%

Property operating expenses	87.6		91.7		(4.1)		(4.5)	%	0.5		10.2		8.3		15.9		96.4		117.8		(21.4)		(18.2)	%

Marketing, general and administrative	—		—		—		—	%	—		—		23.6		23.8		23.6		23.8		(0.2)		(0.8)	%
	87.6		91.7		(4.1)		(4.5)	%	0.5		10.2		31.9		39.7		120.0		141.6		(21.6)		(15.3)	%



Other income (expenses):
Interest expense and amortization of deferred financing costs, net of interest income																	(26.7)		(51.2)		24.5		(47.9)	%
Depreciation and amortization																	(92.5)		(70.5)		(22.0)		31.2	%
Equity in net loss from unconsolidated joint ventures																	(0.4)		(9.9)		9.5		(96.0)	%

Purchase price and other fair value adjustments																	—		3.8		(3.8)		(100.0)	%
Gain on sale of real estate, net																	26.1		3.5		22.6		646	%
Depreciable real estate reserves and impairment																	(6.6)		(7.0)		0.4		(5.7)	%

Loan loss and other investment reserves, net of recoveries																	(9.0)		—		(9.0)		100.0	%




Net income																	$	20.7	$	40.7	$	(20.0)	(49.1)	%

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Rental Revenue

Rental revenues decreased primarily due to our Disposed Properties ($17.8 million), Credit Suisse vacating its space at One Madison Avenue in January 2020 pursuant to an agreement to terminate its lease early so the property can be redeveloped ($12.6 million), lower contribution from our Same-Store properties ($9.4 million) driven by reserves against billed tenant receivables and straight-line rent, and increased vacancy at 625 Madison Avenue, which is expected to be redeveloped ($8.8 million).

The following table presents a summary of the commenced leasing activity for the three months ended September 30, 2020 in our Manhattan portfolio:


	Usable SF	Rentable SF	New Cash Rent (per rentable SF) (1)		Prev. Escalated Rent (per rentable SF) (2)		TI/LC per rentable SF		Free Rent (in months)	Average Lease Term (in years)
Manhattan
Space available at beginning of the period	1,393,574


Acquired Vacancies	32,514

Space which became available during the period (3)
• Office	381,260
• Retail	21,479
• Storage	2,673
	405,412
Total space available	1,831,500
Leased space commenced during the period:
• Office(4)	250,561	274,540	$	69.78	$	67.28	$	48.65	7.3	7.1
• Retail	10,057	10,240	$	267.75	$	302.11	$	—	5.7	2.4
• Storage	580	528	$	21.86	$	21.86	$	—	8.0	5.7
Total leased space commenced	261,198	285,308	$	76.80	$	75.35	$	46.81	7.3	7.2

Total available space at end of period	1,570,302

Early renewals
• Office	66,075	75,439	$	66.32	$	67.31	$	1.54	4.5	4.5
• Retail	1,819	1,913	$	98.22	$	101.87	$	—	2.0	1.0

Total early renewals	67,894	77,352	$	67.11	$	68.16	$	1.50	4.4	4.4

Total commenced leases, including replaced previous vacancy
• Office		349,979	$	69.03	$	67.29	$	38.49	6.7	6.5
• Retail		12,153	$	241.06	$	264.70	$	—	5.1	8.1
• Storage		528	$	21.86	$	21.86	$	—	8.0	5.7
Total commenced leases		362,660	$	74.73	$	73.59	$	37.15	6.7	6.6

(1)Annual initial base rent.

(2)Escalated rent includes base rent plus all additional amounts paid by the tenant in the form of real estate taxes, operating expenses, porters wage or a consumer price index (CPI) adjustment.

(3)Includes expiring space, relocating tenants and move-outs where tenants vacated. Excludes lease expirations where tenants held over.

(4)Average starting office rent excluding new tenants replacing vacancies was $67.94 per rentable square feet for 230,372 rentable square feet. Average starting office rent for office space (leased and early renewals, excluding new tenants replacing vacancies) was $67.54 per rentable square feet for 305,811 rentable square feet.

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Investment Income

For the three months ended September 30, 2020, investment income decreased primarily as a result of a decrease in the weighted average balance and weighted average yield of our debt and preferred equity investments. For the three months ended September 30, 2020 and 2019, the weighted average debt and preferred equity investment balance outstanding and weighted average yield were $1.2 billion and 7.0% compared to $2.1 billion and 9.0%, respectively.

Other Income

Other income increased primarily due to $24.3 million of income derived from a legal settlement offset by $4.1 million of related costs.

Property Operating Expenses

Property operating expenses decreased primarily due to a reduction in variable operating expenses, such as utilities, cleaning, and security, at our Same-Store properties ($4.8 million) as a result of lower physical occupancy at the properties during the quarter related to COVID-19 and decreased operating expenses and real estate taxes at our Disposed properties ($5.5 million and $4.2 million, respectively) and 625 Madison Avenue ($1.8 million and $2.7 million, respectively). This was partially offset by increased real estate taxes at our Same-Store properties ($1.3 million).

Marketing, General and Administrative Expenses

Marketing, general and administrative expenses decreased to $23.6 million for the three months ended September 30, 2020, compared to $23.8 million for the same period in 2019 due to reduced compensation expense.

Interest Expense and Amortization of Deferred Financing Costs, Net of Interest Income

Interest expense and amortization of deferred financing costs, net of interest income, decreased primarily due to interest capitalization at One Madison Avenue pursuant to the redevelopment, repayments of $250.0 million of senior unsecured notes and the 2017 master repurchase agreement in 2020, the sale of 315 West 33rd Street - "The Olivia", and a significant decrease in average LIBOR rates during the three months ended September 30, 2020 compared to the three months ended September 30, 2019. These reductions were partially offset by the new mortgage financing of 220 East 42nd that closed in the second quarter of 2020. The weighted average consolidated debt balance outstanding was $5.6 billion for the three months ended September 30, 2020, compared to $6.1 billion for the three months ended September 30, 2019. The weighted average consolidated interest rate was 2.91% for the three months ended September 30, 2020, as compared to 4.04% for the three months ended September 30, 2019.

Depreciation and Amortization

Depreciation and amortization increased primarily due to accelerated depreciation at One Madison Avenue related to the property's redevelopment ($30.3 million), partially offset by the decreased depreciation and amortization at our Disposed properties and properties transferred to redevelopment ($6.3 million).

Equity in Net Loss from Unconsolidated Joint Ventures

Equity in net loss from unconsolidated joint ventures decreased primarily as a result of increased contribution 280 Park Avenue resulting from lower interest expense ($3.3 million) and a tax abatement benefit recognized in 2020 ($2.4 million), and the addition of 885 Third Avenue in 2020 ($3.6 million).

Equity in net gain on sale of interest in unconsolidated joint venture/real estate

We did not sell any joint venture interests or properties during the three months ended September 30, 2020 or 2019.

Purchase price and other fair value adjustments

During the three months ended September 30, 2020, we did not record any purchase price and other fair value adjustments. During the three months ended September 30, 2019, we sold a 49% interest in 115 Spring Street to a private investor. The transaction resulted in the deconsolidation of our remaining 51% interest. We recorded our retained investment at fair value which resulted in the recognition of a fair value adjustment of $3.8 million.

Gain on sale of real estate, net

During the three months ended September 30, 2020, we recognized gains on sales related to our interest in 126 Nassau Street ($17.7 million) and 400 East 58th Street ($8.3 million). During the three months ended September 30, 2019, we recognized a gain on sale related to our interest in 115 Spring Street ($3.6 million).

Depreciable real estate reserves and impairment

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During the three months ended September 30, 2020, we recognized depreciable real estate reserves and impairment related to 712 Madison Avenue ($6.6 million). During the three months ended September 30, 2019, we recognized depreciable real estate reserves and impairment related to 1010 Washington Boulevard ($7.0 million).

Loan loss and other investment reserves, net of recoveries

During the three months ended September 30, 2020, we recorded $9.0 million of losses related to certain Debt and Preferred Equity investments that were sold.

Comparison of the nine months ended September 30, 2020 to the nine months ended September 30, 2019

The following comparison for the nine months ended September 30, 2020, or 2020, to the nine months ended September 30, 2019, or 2019, makes reference to the effect of the following:

ii.“Acquisition Properties,” which represents all properties or interests in properties acquired in 2020 and 2019 and all non-

Same-Store Properties, including properties that are under development, redevelopment or were deconsolidated during the period,

iii."Disposed Properties," which represents all properties or interests in properties sold or partially sold in 2020 and 2019, and

iv.“Other,” which represents properties that were partially sold resulting in deconsolidation and corporate level items not allocable to specific properties, as well as the Service Corporation and eEmerge Inc.


	Same-Store								Disposed				Other				Consolidated
(in millions)	2020		2019		$ Change		% Change		2020		2019		2020		2019		2020		2019		$ Change		% Change

Rental revenue	$	557.9	$	573.3	$	(15.4)	(2.7)	%	$	16.2	$	60.3	$	39.9	$	99.5	$	614.0	$	733.1	$	(119.1)	(16.2)	%

Investment income	—		—		—		—	%	—		—		101.5		153.2		101.5		153.2		(51.7)		(33.7)	%
Other income	32.1		7.5		24.6		328.0	%	5.8		8.9		64.5		28.2		102.4		44.6		57.8		129.6	%
Total revenues	590.0		580.8		9.2		1.6	%	22.0		69.2		205.9		280.9		817.9		930.9		(113.0)		(12.1)	%

Property operating expenses	258.4		268.7		(10.3)		(3.8)	%	7.2		29.9		29.2		45.2		294.8		343.8		(49.0)		(14.3)	%
Transaction related costs	—		—		—		—	%	—		—		0.5		0.4		0.5		0.4		0.1		25.0	%
Marketing, general and administrative	—		—		—		—	%	—		—		66.7		75.3		66.7		75.3		(8.6)		(11.4)	%
	258.4		268.7		(10.3)		(3.8)	%	7.2		29.9		96.4		120.9		362.0		419.5		(57.5)		(13.7)	%



Other income (expenses):
Interest expense and amortization of deferred financing costs, net of interest income																	(99.4)		(154.4)		55.0		(35.6)	%
Depreciation and amortization																	(256.7)		(208.3)		(48.4)		23.2	%
Equity in net loss from unconsolidated joint ventures																	(15.4)		(22.6)		7.2		(31.9)	%
Equity in net gain on sale of interest in unconsolidated joint venture/real estate																	—		76.2		(76.2)		(100.0)	%
Purchase price and other fair value adjustments																	—		69.4		(69.4)		(100.0)	%
Gain on sale of real estate, net																	163.6		2.5		161.1		6,444	%
Depreciable real estate reserves and impairment																	(6.6)		(7.0)		0.4		(5.7)	%


Loan loss and other investment reserves, net of recoveries																	(27.0)		—		(27.0)		100.0	%



Net income																	$	214.4	$	267.2	$	(52.8)	(19.8)	%

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Rental Revenue

Rental revenue decreased primarily due to our Disposed Properties ($44.1 million), Credit Suisse vacating its space at One Madison Avenue in January 2020 pursuant to an agreement to terminate its lease early so the property can be redeveloped ($33.6 million), increased vacancy at 625 Madison Avenue, which is expected to be redeveloped ($23.0 million), and lower contribution from our Same-Store properties ($15.4 million) driven by reserves against billed tenant receivables and straight-line rent.

The following table presents a summary of the commenced leasing activity for the nine months ended September 30, 2020 in our Manhattan and Suburban portfolio:


	Usable SF	Rentable SF	New Cash Rent (per rentable SF) (1)		Prev. Escalated Rent (per rentable SF) (2)		TI/LC per rentable SF		Free Rent (in months)	Average Lease Term (in years)
Manhattan
Space available at beginning of the period	1,306,757


Acquired vacancies	32,514
Property in redevelopment	(10,695)
Space which became available during the period (3)
• Office	757,433
• Retail	90,384
• Storage	5,784
	853,601
Total space available	2,182,177
Leased space commenced during the period:
• Office(4)	512,873	552,232	$	71.83	$	69.93	$	58.59	6.6	10.0
• Retail	98,000	94,164	$	154.87	$	107.30	$	71.15	9.5	13.5
• Storage	1,002	950	$	38.17	$	37.41	$	—	4.4	3.6
Total leased space commenced	611,875	647,346	$	83.86	$	75.10	$	60.33	7.0	10.5

Total available space at end of period	1,570,302

Early renewals
• Office	279,964	280,533	$	72.25	$	72.57	$	3.84	4.7	4.1
• Retail	67,394	4,653	$	112.13	$	115.80	$	—	—	0.8
• Storage	13,745	4,982	$	41.51	$	40.73	$	—	2.7	7.2
Total early renewals	361,103	290,168	$	72.36	$	74.37	$	4.51	3.0	7.2

Total commenced leases, including replaced previous vacancy
• Office		832,765	$	71.97	$	70.97	$	40.15	5.9	8.0
• Retail		98,817	$	152.85	$	107.82	$	67.80	9.1	12.9
• Storage		5,932	$	40.97	$	40.20	$	—	3.0	6.6
Total commenced leases		937,514	$	80.30	$	74.23	$	42.81	6.2	8.5

(1)Annual initial base rent.

(2)Escalated rent includes base rent plus all additional amounts paid by the tenant in the form of real estate taxes, operating expenses, porters wage or a consumer price index (CPI) adjustment.

(3)Includes expiring space, relocating tenants and move-outs where tenants vacated. Excludes lease expirations where tenants held over.

(4)Average starting office rent excluding new tenants replacing vacancies was $69.70 per rentable square feet for 431,624 rentable square feet. Average starting office rent for office space (leased and early renewals, excluding new tenants replacing vacancies) was $70.71 per rentable square feet for 712,157 rentable square feet.

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Investment Income

For the nine months ended September 30, 2020, investment income decreased primarily as a result of a decrease in the weighted average balance and weighted average yield of our debt and preferred equity investments. For the nine months ended September 30, 2020 and 2019, the weighted average debt and preferred equity investment balance outstanding and weighted average yield were $1.5 billion and 7.9% compared to $2.2 billion and 9.3%, respectively.

Other Income

Other income increased primarily due to higher lease termination income for the nine months ended September 30, 2020 as compared to the same period in 2019 ($49.4 million), driven by lease termination income related to Credit Suisse vacating its space at One Madison Avenue in January 2020 pursuant to an agreement to terminate its lease early so the property can be redeveloped ($40.9 million), and due to $24.3 million of income derived from a legal settlement offset by $4.1 million of related costs.

Property Operating Expenses

Property operating expenses decreased primarily due to a reduction in variable operating expenses, such as utilities, cleaning, and security, at our Same-Store Properties ($15.8 million) as a result of lower physical occupancy at the properties related to COVID-19, and decreased operating expenses and real estate taxes at our Disposed Properties ($13.5 million and $9.2 million, respectively).

Marketing, General and Administrative Expenses

Marketing, general and administrative expenses decreased to $66.7 million for the nine months ended September 30, 2020, compared to $75.3 million for the same period in 2019 due to reduced compensation expense.

Interest Expense and Amortization of Deferred Financing Costs, Net of Interest Income

Interest expense and amortization of deferred financing costs, net of interest income, decreased primarily due to interest capitalization at One Madison Avenue pursuant to the property's redevelopment, repayments of $250.0 million of senior unsecured notes and the 2017 master repurchase agreement in 2020, the sale of 315 West 33rd Street - "The Olivia", and significant a decrease in average LIBOR rates during the nine months ended September 30, 2020 compared to the nine months ended September 30, 2019. These reductions were partially offset by the new mortgage financing of 220 East 42nd that closed in the second quarter of 2020. The weighted average consolidated debt balance outstanding was $6.0 billion for the nine months ended September 30, 2020, compared to $6.1 billion for the nine months ended September 30, 2019. The consolidated weighted average interest rate was 3.11% for the nine months ended September 30, 2020, as compared to 4.05% for the nine months ended September 30, 2019.

Depreciation and Amortization

Depreciation and amortization increased primarily due to accelerated depreciation at One Madison Avenue related to the redevelopment of the property ($59.4 million), partially offset by decreased depreciation and amortization at our Disposed properties ($11.1 million).

Equity in Net Loss from Unconsolidated Joint Ventures

Equity in net loss from unconsolidated joint ventures decreased primarily as a result of increased contribution from 280 Park Avenue resulting from lower interest expense ($7.7 million), a tenant-related charge in 2019 ($3.7 million), and a tax abatement benefit recognized in 2020 ($2.4 million). This was partially offset by an increase in depreciation expense at our unconsolidated joint venture properties ($8.2 million).

Equity in net gain on sale of interest in unconsolidated joint venture/real estate

During the nine months ended September 30, 2020, we did not sell any joint venture interests or properties. During the nine months ended September 30, 2019, we recognized a gain on the sale of our interests in 521 5th Avenue ($57.4 million) and 131 Spring Street ($16.7 million).

Purchase price and other fair value adjustments

During the nine months ended September 30, 2020, the Company did not record any purchase price and other fair value adjustments. During the nine months ended September 30, 2019, we sold a 49% interest in 115 Spring Street to a private investor. The transaction resulted in the deconsolidation of our remaining 51% interest. We recorded our retained investment at fair value which resulted in the recognition of a fair value adjustment of $3.8 million.

In May 2019, we closed on the acquisition of a majority and controlling interest in 460 West 34th Street. We recorded the assets acquired and liabilities assumed at fair value which resulted in the recognition of a fair value adjustment of $67.6 million.

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Gain on sale of real estate, net

During the nine months ended September 30, 2020, we recognized gains from the sales related to our interests in 315 West 33rd Street - "The Olivia" ($72.3 million), the retail condominium at 609 Fifth Avenue ($65.4 million), 126 Nassau Street ($17.7 million) and 400 East 58th Street ($8.3 million). During the nine months ended September 30, 2019, the Company recognized a gain on sale of $3.6 million related to our interest in 115 Spring Street.

Depreciable real estate reserves and impairment

During the nine months ended September 30, 2020, we recognized depreciable real estate reserves and impairment related to 712 Madison Avenue ($6.6 million). During the nine months ended September 30, 2019, we recognized depreciable real estate reserves and impairment related to 1010 Washington Boulevard ($7.0 million).

Loan loss and other investment reserves, net of recoveries

During the nine months ended September 30, 2020, we recorded $12.3 million of losses related to certain Debt and Preferred Equity investments that were sold and $14.7 million of loan loss and other investment reserves in conjunction with recording Debt and Preferred Equity Investments and other financing receivables at the net amount expected to be collected.

Liquidity and Capital Resources

We currently expect that our principal sources of funds to meet our short-term and long-term liquidity requirements for working capital, acquisitions, development or redevelopment of properties, tenant improvements, leasing costs, share repurchases, dividends to shareholders, distributions to unitholders, repurchases or repayments of outstanding indebtedness and for debt and preferred equity investments will include:

(1)Cash flow from operations;

(2)Cash on hand;

(3)Net proceeds from divestitures of properties and redemptions, participations, dispositions and repayments of debt and preferred equity investments;

(4)Borrowings under the revolving credit facility;

(5)Other forms of secured or unsecured financing; and

(6)Proceeds from common or preferred equity or debt offerings by the Company or the Operating Partnership (including issuances of units of limited partnership interest in the Operating Partnership and Trust preferred securities).

Cash flow from operations is primarily dependent upon the collectability of rent, the occupancy level of our portfolio, the net effective rental rates achieved on our leases, the collectability of rent, operating escalations and recoveries from our tenants and the level of operating and other costs. Additionally, we believe that our debt and preferred equity investment program will continue to serve as a source of operating cash flow.

As of the date of this filing, we have collected gross tenant billings for the third quarter of 2020 of 92.7% overall, including 96.9% from office tenants and 70.2% from retail tenants. As of the date of this filing, we have collected gross tenant billings for October 2020 of 93.0% overall, including 96.4% from office tenants and 72.6% from retail tenants.

The combined aggregate principal maturities of our property mortgages and other loans payable, Master Repurchase Agreement ("MRA") and Federal Home Loan Bank of New York ("FHLB") facilities, corporate obligations and our share of joint venture debt, including as-of-right extension options, as of September 30, 2020 were as follows (in thousands):


	Remaining 2020		2021		2022		2023		2024		Thereafter		Total
Property mortgages and other loans	$	18,158	$	221,240	$	264,214	$	1,001,542	$	278,043	$	581,525	$	2,364,722
MRA and FHLB facilities	—		60,000		—		—		—		—		60,000
Corporate obligations	—		350,000		800,000		1,490,000		200,000		200,000		3,040,000
Joint venture debt-our share	10,867		1,444,277		268,952		311,436		618,140		1,935,202		4,588,874
Total	$	29,025	$	2,075,517	$	1,333,166	$	2,802,978	$	1,096,183	$	2,716,727	$	10,053,596

As of September 30, 2020, we had liquidity of $1.6 billion, comprised of $1.3 billion of availability under our revolving credit facility and $0.2 billion of consolidated cash on hand, inclusive of $27.7 million of marketable securities. This liquidity excludes $107.4 million representing our share of cash at unconsolidated joint venture properties. We may seek to divest of properties, interests in properties or debt and preferred equity investments or access private and public debt and equity capital when the opportunity presents itself, although there is no guarantee that this capital will be made available to us at efficient levels or at all. Management believes that these sources of liquidity, if we are able to access them, along with potential

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refinancing opportunities for secured and unsecured debt, will allow us to satisfy our debt obligations, as described above, upon maturity, if not before.

We have investments in several real estate joint ventures with various partners who we consider to be financially stable and who have the ability to fund a capital call when needed. Most of our joint ventures are financed with non-recourse debt. We believe that property level cash flows along with unfunded committed indebtedness and proceeds from the refinancing of outstanding secured indebtedness will be sufficient to fund the capital needs of our joint venture properties.

Cash Flows

The following summary discussion of our cash flows is based on our consolidated statements of cash flows in "Item 1. Financial Statements" and is not meant to be an all-inclusive discussion of the changes in our cash flows for the periods presented below.

Cash, restricted cash, and cash equivalents were $304.4 million and $216.5 million at September 30, 2020 and 2019, respectively, representing an increase of $87.9 million. The increase was a result of the following changes in cash flows (in thousands):


	Nine Months Ended September 30,
	2020		2019		Change
Net cash provided by operating activities	$	327,943	$	299,433	$	28,510
Net cash provided by (used in) investing activities	$	375,023	$	(240,900)	$	615,923
Net cash used in financing activities	$	(639,947)	$	(121,102)	$	(518,845)

Our principal sources of operating cash flow are the properties in our consolidated and joint venture portfolios and our debt and preferred equity portfolio. These sources generate a relatively consistent stream of cash flow that provides us with resources to pay operating expenses, debt service and fund dividend and distribution requirements.

Cash is used in investing activities to fund acquisitions, development or redevelopment projects and recurring and nonrecurring capital expenditures. We selectively invest in new projects that enable us to take advantage of our development, leasing, financing and property management skills and invest in existing buildings that meet our investment criteria. During the nine months ended September 30, 2020, when compared to the nine months ended September 30, 2019, we used cash primarily for the following investing activities (in thousands):


Acquisitions of real estate	$	174,750
Capital expenditures and capitalized interest	(130,909)
Escrow cash-capital improvements/acquisition deposits/deferred purchase price	228
Joint venture investments	74,326
Distributions from joint ventures	41,724
Proceeds from sales of real estate/partial interest in property	194,089
Debt and preferred equity and other investments	261,715
Increase in net cash provided by investing activities	$	615,923

Funds spent on capital expenditures, which are comprised of building and tenant improvements, increased from $150.7 million for the nine months ended September 30, 2019 to $281.7 million for the nine months ended September 30, 2020 due to increased spending on development and redevelopment projects.

We generally fund our investment activity through the sale of real estate, the sale of debt and preferred equity investments, property-level financing, our credit facilities, our MRA facility, our FHLB facility, senior unsecured notes, and construction loans. From time to time, the Company may issue common or preferred stock, or the Operating Partnership may issue common or preferred units of limited partnership interest.

During the nine months ended September 30, 2020, when compared to the nine months ended September 30, 2019, we used cash for the following financing activities (in thousands):


Proceeds from our debt obligations	$	614,703
Repayments of our debt obligations	(868,328)
Net distribution to noncontrolling interests	(2,981)
Other financing activities	(18,820)

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Proceeds from stock options exercised and DRSPP issuance	264

Repurchase of common stock	(206,987)
Redemption of preferred stock	(67,608)
Acquisition of subsidiary interest from noncontrolling interest	24,255
Dividends and distributions paid	6,657
Decrease in net cash used in financing activities	$	(518,845)

Capitalization

Our authorized capital stock consists of 260,000,000 shares, $0.01 par value per share, consisting of 160,000,000 shares of common stock, $0.01 par value per share, 75,000,000 shares of excess stock, at $0.01 par value per share, and 25,000,000 shares of preferred stock, $0.01 par value per share. As of September 30, 2020, 73,040,291 shares of common stock and no shares of excess stock were issued and outstanding.

Share Repurchase Program

In August 2016, our Board of Directors approved a share repurchase program under which we can repurchase up to $1.0 billion of shares of our common stock. The Board of Directors has since authorized four separate $500.0 million increases to the size of the share repurchase program in the fourth quarter of 2017, second quarter of 2018, fourth quarter of 2018, and fourth quarter of 2019 bringing the total program size to $3.0 billion.

At September 30, 2020, repurchases executed under the program were as follows:


Period	Shares repurchased	Average price paid per share	Cumulative number of shares repurchased as part of the repurchase plan or programs
Year ended 2017	8,342,411	$101.64	8,342,411
Year ended 2018	9,744,911	$96.22	18,087,322
Year ended 2019	4,596,171	$83.62	22,683,493
Nine months ended September 30, 2020 (1)	6,243,165	$62.77	28,926,658

(1) Includes 216,101 shares of common stock repurchased by the Company in September 2020 that were settled in October 2020.

Dividend Reinvestment and Stock Purchase Plan ("DRSPP")

The following table summarizes SL Green common stock issued, and proceeds received from dividend reinvestments and/or stock purchases under the DRSPP for the nine months ended September 30, 2020 and 2019, respectively (dollars in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Shares of common stock issued	4,205		490		9,884		3,485
Dividend reinvestments/stock purchases under the DRSPP	$	202	$	39	$	566	$	303

Fourth Amended and Restated 2005 Stock Option and Incentive Plan

The Fourth Amended and Restated 2005 Stock Option and Incentive Plan, or the 2005 Plan, was approved by the Company's board of directors in April 2016 and its stockholders in June 2016 at the Company's annual meeting of stockholders. Subject to adjustments upon certain corporate transactions or events, awards with respect to up to a maximum of 27,030,000 fungible units may be granted as options, restricted stock, phantom shares, dividend equivalent rights and other equity-based awards under the 2005 Plan. As of September 30, 2020, 3.4 million fungible units were available for issuance under the 2005 Plan after reserving for shares underlying outstanding restricted stock units, phantom stock units granted pursuant to our Non-Employee Directors' Deferral Program and LTIP Units.

Deferred Compensation Plan for Directors

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As of September 30, 2020, there were 138,189 phantom stock units outstanding pursuant to our Non-Employee Director's Deferral Program.

Indebtedness

The table below summarizes our consolidated mortgages and other loans payable, 2017 credit facility, senior unsecured notes and trust preferred securities outstanding at September 30, 2020 and December 31, 2019, (amounts in thousands).


Debt Summary:	September 30, 2020			December 31, 2019
Balance
Fixed rate	$	1,988,268		$	2,536,286
Variable rate—hedged	1,350,000			1,000,000
Total fixed rate	3,338,268			3,536,286
Total variable rate	2,128,581			2,018,434
Total debt	$	5,466,849		$	5,554,720

Debt, preferred equity, and other investments subject to variable rate	426,703			618,885
Net exposure to variable rate debt	1,701,878			1,399,549

Percent of Total Debt:
Fixed rate	61.1		%	63.7		%
Variable rate (1)	38.9		%	36.3		%
Total	100.0		%	100.0		%
Effective Interest Rate for the Year:
Fixed rate	3.65		%	4.05		%
Variable rate	2.32		%	3.93		%
Effective interest rate	2.91		%	3.85		%

(1) Inclusive of the mitigating effect of our debt, preferred equity, and other investments subject to variable rate, the percent of total debt of our net exposure to variable rate debt was 33.8% and 28.4% as of September 30, 2020 and December 31, 2019, respectively.

The variable rate debt shown above generally bears interest at an interest rate based on 30-day LIBOR (0.15% and 1.76% at September 30, 2020 and December 31, 2019, respectively). Our consolidated debt at September 30, 2020 had a weighted average term to maturity of 3.09 years.

Certain of our debt and equity investments and other investments, with carrying values of $0.4 billion at September 30, 2020 and $0.6 billion at December 31, 2019, are variable rate investments which mitigate our exposure to interest rate changes on our unhedged variable rate debt. Inclusive of the mitigating effect of these investments, the net percent of our variable rate debt to total debt was 33.8% and 28.4%, respectively.

2017 Credit Facility

In November 2017, we entered into an amendment to the credit facility, referred to as the 2017 credit facility, that was originally entered into by the Company in November 2012, or the 2012 credit facility. As of September 30, 2020, the 2017 credit facility consisted of a $1.5 billion revolving credit facility, a $1.3 billion term loan (or "Term Loan A"), and a $200.0 million term loan (or "Term Loan B") with maturity dates of March 31, 2022, March 31, 2023, and November 21, 2024, respectively. The revolving credit facility has two six-month as-of-right extension options to March 31, 2023. We also have an option, subject to customary conditions, to increase the capacity of the credit facility to $4.5 billion at any time prior to the maturity dates for the revolving credit facility and term loans without the consent of existing lenders, by obtaining additional commitments from our existing lenders and other financial institutions.

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The Company and the Operating Partnership are borrowers jointly and severally obligated under the 2017 credit facility.

The 2017 credit facility includes certain restrictions and covenants (see Restrictive Covenants below).

Restrictive Covenants

Interest Rate Risk

We are exposed to changes in interest rates primarily from our variable rate debt. Our exposure to interest rate fluctuations are managed through either the use of interest rate derivative instruments and/or through our variable rate debt and preferred equity investments. Based on the debt outstanding as of September 30, 2020, a hypothetical 100 basis point increase in the floating rate interest rate curve would increase our consolidated annual interest cost, net of interest income from variable rate debt and preferred equity investments, by $16.1 million and would increase our share of joint venture annual interest cost by $19.8 million. At September 30, 2020, 37.0% of our $1.15 billion debt and preferred equity portfolio is indexed to LIBOR.

We recognize most derivatives on the balance sheet at fair value. Derivatives that are not hedges are adjusted to fair value through income. If a derivative is considered a hedge, depending on the nature of the hedge, changes in the fair value of the derivative will either be offset against the change in fair value of the hedged asset, liability, or firm commitment through earnings, or recognized in other comprehensive income until the hedged item is recognized in earnings.

Our long-term debt of $3.3 billion bears interest at fixed rates, and therefore the fair value of these instruments is affected by changes in the market interest rates. Our variable rate debt and variable rate joint venture debt as of September 30, 2020 bore interest based on a spread of LIBOR plus 18 basis points to LIBOR plus 340 basis points.

Contractual Obligations

Refer to our 2019 Annual Report on Form 10-K for a discussion of our contractual obligations. There have been no material changes, outside the ordinary course of business, to these contractual obligations during the three months ended September 30, 2020.

Off-Balance Sheet Arrangements

We have off-balance sheet investments, including joint ventures and debt and preferred equity investments. These investments all have varying ownership structures. A majority of our joint venture arrangements are accounted for under the equity method of accounting as we have the ability to exercise significant influence, but not control, over the operating and financial decisions of these joint venture arrangements. Our off-balance sheet arrangements are discussed in Note 5, "Debt and Preferred Equity Investments" and Note 6, "Investments in Unconsolidated Joint Ventures" in the accompanying consolidated financial statements.

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Capital Expenditures

We estimate that for the remainder of the year ending December 31, 2020, we expect to incur $22.9 million of recurring capital expenditures on existing consolidated properties and $71.5 million of development or redevelopment expenditures on existing consolidated properties, of which $41.1 million will be funded by construction financing facilities. We expect our share of capital expenditures at our joint venture properties will be $140.3 million, of which $92.1 million will be funded by construction financing facilities. We expect to fund capital expenditures from operating cash flow, existing liquidity, and borrowings from construction financing facilities. Future property acquisitions may require substantial capital investments for refurbishment and leasing costs.

Dividends/Distributions

We expect to pay cash dividends to our stockholders based on the distributions we receive from our Operating Partnership, which are generated by the collection of property revenues, net of operating expenses, and interest on our debt and preferred equity portfolio.

To maintain our qualification as a REIT, we must pay annual dividends to our stockholders of at least 90% of our REIT taxable income, determined before taking into consideration the dividends paid deduction and net capital gains.

Any dividend we pay may be in the form of cash, stock or a combination thereof, subject to IRS limitations on the use of stock for dividends. Additionally, if our REIT taxable income in a particular year exceeds the amount of cash dividends we pay in that year, we may pay stock dividends in order to maintain our REIT status and avoid certain REIT-level taxes.

Before we pay any cash dividend, whether for Federal income tax purposes or otherwise, which would only be paid out of available cash to the extent permitted under the 2017 credit facility and senior unsecured notes, we must first meet both our operating requirements and scheduled debt service on our mortgages and loans payable.

Insurance

We maintain “all-risk” property and rental value coverage (including coverage regarding the perils of flood, earthquake and terrorism, excluding nuclear, biological, chemical, and radiological terrorism ("NBCR")), within three property insurance programs and liability insurance. Separate property and liability coverage may be purchased on a stand-alone basis for certain assets, such as the development of One Vanderbilt. Additionally, one of our captive insurance companies, Belmont Insurance Company, or Belmont, provides coverage for NBCR terrorist acts above a specified trigger. Belmont's retention is reinsured by our other captive insurance company, Ticonderoga Insurance Company ("Ticonderoga"). If Belmont or Ticonderoga are required to pay a claim under our insurance policies, we would ultimately record the loss to the extent of required payments. However, there is no assurance that in the future we will be able to procure coverage at a reasonable cost. Further, if we experience losses that are uninsured or that exceed policy limits, we could lose the capital invested in the damaged properties as well as the anticipated future cash flows from those properties. Additionally, our debt instruments contain customary covenants requiring us to maintain insurance and we could default under our debt instruments if the cost and/or availability of certain types of insurance make it impractical or impossible to comply with such covenants relating to insurance. Belmont and Ticonderoga provide coverage solely on properties owned by the Company or its affiliates.

Furthermore, with respect to certain of our properties, including properties held by joint ventures or subject to triple net leases, insurance coverage is obtained by a third-party and we do not control the coverage. While we may have agreements with such third parties to maintain adequate coverage and we monitor these policies, such coverage ultimately may not be maintained or adequately cover our risk of loss.

Funds from Operations

FFO is a widely recognized non-GAAP financial measure of REIT performance. The Company computes FFO in accordance with standards established by NAREIT, which may not be comparable to FFO reported by other REITs that do not compute FFO in accordance with the NAREIT definition, or that interpret the NAREIT definition differently than the Company does. The revised White Paper on FFO approved by the Board of Governors of NAREIT in April 2002, and subsequently amended in December 2018, defines FFO as net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from sales of properties and real estate related impairment charges, plus real estate related depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures.

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The Company presents FFO because it considers it an important supplemental measure of the Company’s operating performance and believes that it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, particularly those that own and operate commercial office properties. The Company also uses FFO as one of several criteria to determine performance-based compensation for members of its senior management. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. Because FFO excludes depreciation and amortization unique to real estate, gains and losses from property dispositions, and real estate related impairment charges, it provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, and interest costs, providing perspective not immediately apparent from net income. FFO does not represent cash generated from operating activities in accordance with GAAP and should not be considered as an alternative to net income (determined in accordance with GAAP), as an indication of the Company’s financial performance or to cash flow from operating activities (determined in accordance with GAAP) as a measure of the Company’s liquidity, nor is it indicative of funds available to fund the Company’s cash needs, including our ability to make cash distributions.

FFO for the three and nine months ended September 30, 2020 and 2019 are as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Net income attributable to SL Green common stockholders	$	13,859	$	33,157	$	185,104	$	238,052
Add:
Depreciation and amortization	92,516		70,464		256,736		208,268
Joint venture depreciation and noncontrolling interest adjustments	47,884		47,674		149,309		145,202
Net income attributable to noncontrolling interests	1,216		1,095		11,218		9,782
Less:
Equity in net gain on sale of interest in unconsolidated joint venture/real estate	—		—		—		76,181
Depreciable real estate reserves and impairment	(6,627)		(7,047)		(6,627)		(7,047)
Gain on sale of real estate, net	26,104		3,541		163,624		2,492
Purchase price and other fair value adjustments	—		3,799		—		69,389
Depreciation on non-rental real estate assets	538		740		1,797		2,193
Funds from Operations attributable to SL Green common stockholders	$	135,460	$	151,357	$	443,573	$	458,096
Cash flows provided by operating activities	$	103,638	$	81,518	$	327,943	$	299,433
Cash flows (used in) provided by investing activities	$	(28,796)	$	225,504	$	375,023	$	(240,900)
Cash flows used in financing activities	$	(871,676)	$	(331,625)	$	(639,947)	$	(121,102)

Inflation

Substantially all of our office leases provide for separate real estate tax and operating expense escalations as well as operating expense recoveries based on increases in the Consumer Price Index or other measures such as porters' wage. In addition, many of the leases provide for fixed base rent increases. We believe that inflationary increases will be at least partially offset by the contractual rent increases and expense escalations described above.

Accounting Standards Updates

The Accounting Standards Updates are discussed in Note 2, "Significant Accounting Policies-Accounting Standards Updates" in the accompanying consolidated financial statements.

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Forward-Looking Information

This report includes certain statements that may be deemed to be "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and are intended to be covered by the safe harbor provisions thereof. All statements, other than statements of historical facts, included in this report that address activities, events or developments that we expect, believe or anticipate will or may occur in the future, including such matters as future capital expenditures, dividends and acquisitions (including the amount and nature thereof), development trends of the real estate industry and the New York metropolitan area markets, business strategies, expansion and growth of our operations and other similar matters, are forward-looking statements. These forward-looking statements are based on certain assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate.

Forward-looking statements are not guarantees of future performance and actual results or developments may differ materially, and we caution you not to place undue reliance on such statements. Forward-looking statements are generally identifiable by the use of the words "may," "will," "should," "expect," "anticipate," "estimate," "believe," "intend," "project," "continue," or the negative of these words, or other similar words or terms.

Forward-looking statements contained in this report are subject to a number of risks and uncertainties that may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by forward-looking statements made by us. These risks and uncertainties include:

•the effect of general economic, business and financial conditions, and their effect on the New York City real estate market in particular;

•the effect of the on-going COVID-19 pandemic and the duration of the impact it will have on our business and the industry as a whole;

•dependence upon certain geographic markets;

•risks of real estate acquisitions, dispositions, development and redevelopment, including the cost of construction delays and cost overruns;

•risks relating to debt and preferred equity investments;

•availability and creditworthiness of prospective tenants and borrowers;

•bankruptcy or insolvency of a major tenant or a significant number of smaller tenants or borrowers;

•adverse changes in the real estate markets, including reduced demand for office space, increasing vacancy, and increasing availability of sublease space;

•availability of capital (debt and equity);

•unanticipated increases in financing and other costs, including a rise in interest rates;

•our ability to comply with financial covenants in our debt instruments;

•our ability to maintain our status as a REIT;

•risks of investing through joint venture structures, including the fulfillment by our partners of their financial obligations;

•the threat of terrorist attacks;

•our ability to obtain adequate insurance coverage at a reasonable cost and the potential for losses in excess of our insurance coverage, including as a result of environmental contamination; and

•legislative, regulatory and/or safety requirements adversely affecting REITs and the real estate business including costs of compliance with the Americans with Disabilities Act, the Fair Housing Act and other similar laws and regulations.

Other factors and risks to our business, many of which are beyond our control, are described in other sections of this report and in our other filings with the SEC. Except to the extent required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of future events, new information or otherwise.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

For quantitative and qualitative disclosure about market risk, see Item 2, "Management's Discussion and Analysis of Financial Condition and Results of Operation - Market Risk" in this Quarterly Report on Form 10-Q for the three and nine months ended September 30, 2020 for the Company and the Operating Partnership and Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations - Market Rate Risk" in the Annual Report on Form 10-K for the year ended December 31, 2019 for the Company and the Operating Partnership. Our exposures to market risk have not changed materially since December 31, 2019.

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ITEM 4. CONTROLS AND PROCEDURES

SL GREEN REALTY CORP.

Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to the Company's management, including the Company's Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure based closely on the definition of "disclosure controls and procedures" in Rule 13a-15(e) of the Exchange Act. Notwithstanding the foregoing, a control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that it will detect or uncover failures within the Company to disclose material information otherwise required to be set forth in our periodic reports. Also, the Company has investments in certain unconsolidated entities. As the Company does not control these entities, its disclosure controls and procedures with respect to such entities are necessarily substantially more limited than those the Company maintains with respect to its consolidated subsidiaries.

As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the Company's management, including our Chief Executive Officer and our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based upon that evaluation as of the end of the period covered by this report, the Company's Chief Executive Officer and Chief Financial Officer concluded that its disclosure controls and procedures were effective to give reasonable assurances to the timely collection, evaluation and disclosure of information relating to the Company that would potentially be subject to disclosure under the Exchange Act and the rules and regulations promulgated thereunder.

Changes in Internal Control over Financial Reporting

There have been no significant changes in the Company's internal control over financial reporting during the quarter ended September 30, 2020 that have materially affected, or are reasonably likely to materially affect, its internal control over financial reporting.

SL GREEN OPERATING PARTNERSHIP, L.P.

Evaluation of Disclosure Controls and Procedures

Changes in Internal Control over Financial Reporting

There have been no significant changes in the Operating Partnership's internal control over financial reporting during the quarter ended September 30, 2020 that have materially affected, or are reasonably likely to materially affect, its internal control over financial reporting.

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PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

ITEM 1A. RISK FACTORS

As of September 30, 2020 there have been no material changes to the Risk Factors disclosed in "Part I. Item 1A. Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2019, other than the addition of the following risk factor:

The COVID-19 pandemic and health and safety measures intended to reduce its spread could adversely affect our business, results of operations, and financial condition.

Beginning in late 2019, a novel strain of Coronavirus (“COVID-19”) began to spread throughout the world, including the United States, ultimately being declared a pandemic by the World Health Organization. Over the past several months the pandemic has caused, and continues to cause, severe disruptions with wide ranging impacts to the global economy and everyday life. We expect that our business, results of operations, liquidity, cash flows, prospects, and our ability to achieve forward-looking targets and expectations could be materially and adversely affected for at least the duration of the COVID-19 pandemic and possibly longer. This could also cause significant volatility in the trading prices of our securities. The extent of the impact of the COVID-19 pandemic will depend on future developments, including the duration, severity and spread of the pandemic, health and safety actions taken to contain its spread and how quickly and to what extent normal economic and operating conditions can resume. Additionally, the COVID-19 pandemic could increase the magnitude of many of the other risks described in our latest Annual Report on Form 10-K and other SEC filings and may have other adverse effects on our operations that we are not currently able to predict.

The scale and magnitude of adverse impacts could depend on, among other factors:

•the financial condition of our tenants and their ability or willingness to pay rent in full on a timely basis;

•the impact on rents and demand for office and retail space;

•the impact of new regulations or norms on physical space needs and expectations;

•the financial condition of the borrowers and sponsors of our debt and preferred equity investments and their ability or willingness to make interest and principal payments;

•the effectiveness of governmental measures aimed at slowing and containing the spread;

•the effect of changes in laws and regulation;

•the extent and terms associated with governmental relief programs;

•the ability of debt and equity markets to function and provide liquidity;

•the ability to avoid delays or cost increases associated with building materials or construction services necessary for development, redevelopment and tenant improvements; and

•our tenants’ ability to ensure business continuity in the event a continuity of operations plan is not effective or improperly implemented.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

At September 30, 2020, repurchases executed under the program were as follows:


Period	Shares repurchased	Average price paid per share	Total number of shares repurchased as part of the repurchase plan or programs
Year ended 2017	8,342,411	$101.64	8,342,411
Year ended 2018	9,744,911	$96.22	18,087,322
Year ended 2019	4,596,171	$83.62	22,683,493
Nine months ended September 30, 2020 (1)	6,243,165	$62.77	28,926,658

(1) Includes 216,101 shares of common stock repurchased by the Company in September 2020 that were settled in October 2020.

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ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

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ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable.

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ITEM 5. OTHER INFORMATION

None.

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ITEM 6. EXHIBITS


31.1			Certification by the Chairman and Chief Executive Officer of the Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
31.2			Certification by the Chief Financial Officer of the Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
31.3			Certification by the Chairman and Chief Executive Officer of the Company, the sole general partner of the Operating Partnership pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
31.4			Certification by the Chief Financial Officer of the Company, the sole general partner of the Operating Partnership pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
32.1			Certification by the Chairman and Chief Executive Officer pursuant to 18 U.S.C. section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.
32.2			Certification by the Chief Financial Officer pursuant to 18 U.S.C. section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.
32.3			Certification by the Chairman and Chief Executive Officer of the Company, the sole general partner of the Operating Partnership pursuant to 18 U.S.C. section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.
32.4			Certification by the Chief Financial Officer of the Company, the sole general partner of the Operating Partnership pursuant to 18 U.S.C. section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.
101			The following financial statements from SL Green Realty Corp. and SL Green Operating Partnership L.P.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2020, formatted in Inline XBRL: (i) Consolidated Balance Sheets (unaudited), (ii) Consolidated Statements of Operations (unaudited), (iii) Consolidated Statements of Comprehensive Income (unaudited), (iv) Consolidated Statements of Equity (unaudited), (v) Consolidated Statements of Capital (unaudited) (vi) Consolidated Statements of Cash Flows (unaudited), and (vii) Notes to Consolidated Financial Statements (unaudited), detail tagged and filed herewith.
104			Cover Page Interactive Data File (formatted as Inline XBRL in Exhibit 101)

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

SL GREEN REALTY CORP.

By:

SL Green Realty Corp.

/s/ Matthew J. DiLiberto

Dated: November 5, 2020

By:

Matthew J. DiLiberto

Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated:


Signatures	Title	Date

/s/ Marc Holliday	Chairman of the Board of Directors and Chief Executive Officer and Director of SL Green, the sole general partner of the Operating Partnership (Principal Executive Officer)	November 5, 2020
Marc Holliday

/s/ Andrew W. Mathias	President and Director of SL Green, the sole general partner of the Operating Partnership	November 5, 2020
Andrew W. Mathias

/s/ Matthew J. DiLiberto	Chief Financial Officer of SL Green, the sole general partner of the Operating Partnership (Principal Financial and Accounting Officer)	November 5, 2020
Matthew J. DiLiberto

/s/ Stephen L. Green	Director of SL Green, the sole general partner of the Operating Partnership	November 5, 2020
Stephen L. Green

/s/ John H. Alschuler, Jr.	Director of SL Green, the sole general partner of the Operating Partnership	November 5, 2020
John H. Alschuler, Jr.

/s/ Edwin T. Burton, III	Director of SL Green, the sole general partner of the Operating Partnership	November 5, 2020
Edwin T. Burton, III

/s/ John S. Levy	Director of SL Green, the sole general partner of the Operating Partnership	November 5, 2020
John S. Levy

/s/ Craig M. Hatkoff	Director of SL Green, the sole general partner of the Operating Partnership	November 5, 2020
Craig M. Hatkoff

/s/ Betsy S. Atkins	Director of SL Green, the sole general partner of the Operating Partnership	November 5, 2020
Betsy S. Atkins

/s/ Lauren B. Dillard	Director of SL Green, the sole general partner of the Operating Partnership	November 5, 2020
Lauren B. Dillard

SIGNATURES

SL GREEN OPERATING PARTNERSHIP, L.P.

By:

/s/ Matthew J. DiLiberto

Dated: November 5, 2020

Matthew J. DiLiberto

Chief Financial Officer