Part 1: Who is Vornado Realty Trust?
Understanding who Vornado is—and how it operates—is the first step toward a more transparent and community-driven development process in New York City. In the Vornado Watch series, we will explore Vornado’s role in specific projects and unpack its political ties.
“We expect rents to rise aggressively, one might even say to spike… and, in fact, rents have already started to rise. So all good, very good.” Those are the words of Vornado Realty Trust’s Chairman and CEO—Steven Roth—talking about New York City real estate in his letter to Vornado’s shareholders included in its 2024 annual report.
But who is Vornado and why is it so gleeful about spiking rent prices? Vornado Realty Trust is one of the most powerful and politically-connected real estate companies in New York City. Although its name may not be widely recognized by the public, its influence is deeply felt across Manhattan. From massive office towers to controversial rezonings, Vornado plays a central role in shaping the city’s future—often with limited public oversight.
Vornado’s roots go back to a 1940s appliance retailer known as Two Guys. The company pivoted to real estate in the 1980s under the leadership of Steven Roth, who remains its chairman and CEO today. Roth capitalized on the fact that the properties Two Guys owned was more valuable than the stores themselves. Thus, Roth transformed Vornado into a real estate investment trust (REIT) in 1982, after closing the stores to profit solely from the company’s real estate holdings. In 2024, Vornado reported holding nearly $16 billion in assets, including more than 20 million square feet of office and retail space in Manhattan. Its real estate holdings generated nearly $1.8 billion in revenue last year.
Vornado focuses on high-value, large-scale redevelopment projects, and its focus on New York City is intensifying. Its holdings around Penn Station—comprising more than a dozen office and retail properties—position it as a key player in the state’s controversial Penn Station redevelopment plan. That megaproject, initially backed by former Governor Andrew Cuomo, envisioned 10 new skyscrapers and large-scale demolitions to finance improvements to the transit hub. Critics have noted that Vornado’s projects often prioritize high-end office and retail uses, with little affordable housing or community benefit. Indeed, Vornado’s investment strategy—based on this excerpt from Roth’s shareholder letter—seems to be to raise rent prices through concentrated high-end development:
Our first bold stroke in THE PENN DISTRICT was investing $2.5 billion in PENN 1, PENN 2, and Farley, which totally modernized those buildings and raised the bar in the entire city for amenities at scale and our hospitality strategy for today’s Class A Buildings. We raised market rents here from $50 to $100. I predict that with Manhattan West and Hudson Yards, our good neighbors to the west, achieving rents of over $150, so will we at THE PENN DISTRICT. Think about it, these 5 million square feet if increased by $50 will yield as much as an incremental $250 million per annum, to be achieved over time, basically to our bottom line – worth as much as $25 a share.
In other words, if Vornado succeeds in tripling rent prices in the Penn District, it believes it could yield over 50% gains for its stockholders. As residents and advocates, it’s essential to stay informed about the entities like Vornado that are reshaping the city—often behind closed doors. Real estate decisions shape not just buildings, but lives.