<PAGE>

================================================================================

                   SECOND AMENDMENT TO BUILDING LOAN AGREEMENT

                         Dated as of February 13, 2004

                                     Between

                   731 COMMERCIAL LLC and 731 RESIDENTIAL LLC,
                           collectively, as Borrower,

                                       and

                      HYPO REAL ESTATE CAPITAL CORPORATION,
                                    as Agent,

                                       and

                            THE LENDERS NAMED HEREIN,
                                   as Lenders

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

                         Location: 731 Lexington Avenue
                                   New York, New York

                             County: New York County

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

                        TO BE FILED WITH THE COUNTY CLERK
                          OF NEW YORK COUNTY, NEW YORK

================================================================================

<PAGE>

                   SECOND AMENDMENT TO BUILDING LOAN AGREEMENT

                  THIS SECOND AMENDMENT TO BUILDING LOAN AGREEMENT, dated as of
February 13, 2004 (this "AMENDMENT"), between 731 COMMERCIAL LLC ("COMMERCIAL
OWNER") and 731 RESIDENTIAL LLC ("RESIDENTIAL OWNER"), each a Delaware limited
liability company, having its principal place of business at 888 Seventh Avenue,
New York, New York 10019, collectively as Borrower ("BORROWER"), and HYPO REAL
ESTATE CAPITAL CORPORATION ("HYPO") , a Delaware corporation, having an address
at 622 Third Avenue, New York, New York 10017, as administrative agent
(including any of its successors and assigns, "AGENT") for itself and the other
Lenders signatory hereto (collectively, together with such other co-lenders as
may exist from time to time, "LENDERS").

                              W I T N E S S E T H :

                  WHEREAS, Residential Owner, Commercial Owner, Agent (as
successor agent to Bayerische Hypo- und Vereinsbank AG, New York Branch ("HVB"))
and Hypo (as assignee of HVB), as Lender, are parties to that certain Building
Loan Agreement dated as of July 3, 2002 between Borrower, HVB, as agent, and the
lenders signatory thereto, filed on July 9, 2002 as Index No. 150 in the County
Clerk's Office of New York County, as amended by that certain First Amendment to
Building Loan Agreement dated as of March 5, 2003 between Borrower, HVB, as
agent and the lenders signatory thereto, which was filed on March 11, 2003 as
Index No. 39 in said County Clerk's Office (as so amended, the "EXISTING
BUILDING LOAN AGREEMENT"), Agent agreed to administer and Lender agreed to make
a building loan to Borrower in the aggregate principal sum of up to Two Hundred
Fifteen Million and no/100 Dollars ($215,000,000.00) (the "BUILDING LOAN")
related to the construction of the Improvements (as hereinafter defined) on the
property described on Exhibit A hereto (the "ORIGINAL MORTGAGED PREMISES").

                  WHEREAS, the Building Loan is (i) evidenced by that certain
Consolidated, Amended and Restated Building Loan Note dated March 5, 2003 made
by 731 Residential LLC and 731 Commercial LLC in favor of HVB, in the principal
amount of $215,000,000.00, which was endorsed and assigned by HVB to Hypo on
December 4, 2003 (the "EXISTING BUILDING LOAN NOTE") and (ii) secured by, inter
alia, that certain Consolidated, Amended and Restated Building Loan Mortgage,
Assignment of Leases and Rents and Security Agreement (Series No. 1), dated as
of July 3, 2002, made by Borrower in favor of HVB, as agent ("ORIGINAL
MORTGAGEE") and recorded on September 25, 2002 in the Office of the Register of
the City of New York, County of New York ("REGISTER'S OFFICE") in Reel 3617 Page
2024, and Gap Mortgage, dated as of March 5, 2003, in the principal amount of
$159,500,000 made by Borrower to Original Mortgagee and recorded on May 1, 2003
in CRFN #2003000112521 in the Register's Office, as consolidated, amended and
restated by that certain Consolidated, Amended and Restated Building Loan
Mortgage, Assignment of Rents and Leases and Security Agreement, dated as of
March 5, 2003, to form a single consolidated lien in the principal amount of
$215,000,000, made by Borrower to Original Mortgagee, and recorded on May 1,
2003 in CRFN#2003000112522 in the Register's Office, which consolidated, amended
and restated mortgage in the consolidated principal amount of $215,000,000.00
was assigned by Original

<PAGE>

Mortgagee to Agent pursuant to that certain Assignment of Consolidated, Amended
and Restated Building Loan Mortgage, Assignment of Rents and Leases and Security
Agreement, dated as of December 4, 2003, and intended to be recorded in the
Register's Office (said consolidated, amended and restated mortgage as so
assigned, the "EXISTING BUILDING LOAN MORTGAGE").

                  WHEREAS, the total principal amount of the Building Loan has
been fully funded and the outstanding principal amount of the Existing Building
Loan Note which is secured by the Existing Building Loan Mortgage is Two Hundred
Fifteen Million and No/100 Dollars ($215,000,000.00).

                  WHEREAS, concurrently herewith, the parties hereto are
entering into a Note and Mortgage Modification and Severance Agreement (the
"SEVERANCE AGREEMENT") pursuant to which (i) the indebtedness evidenced by the
Existing Building Loan Note is being split and modified into two separate
indebtednesses of $90,000,000.00 and $125,000,000.00, respectively, and the
Existing Building Loan Note is being replaced and restated in its entirety by
two substitute building loan mortgage notes, one in the principal amount of
$90,000,000.00 ("SUBSTITUTE BUILDING LOAN NOTE A") and the other in the
principal amount of $125,000,000.00 ("SUBSTITUTE BUILDING LOAN NOTE B") and (ii)
the consolidated lien of the Existing Building Loan Mortgage is being split and
modified into two separate liens securing such separate indebtednesses of
$90,000,000.00 and $125,000,000.00, respectively, and the Existing Building Loan
Mortgage is being replaced in its entirety by two substitute building loan
mortgages, assignments of leases and rents and security agreements, one in the
principal amount of $90,000,000.00 ("SUBSTITUTE BUILDING LOAN MORTGAGE A")
securing Substitute Building Loan Note A, and the other in the principal amount
of $125,000,000.00 ("SUBSTITUTE BUILDING LOAN MORTGAGE B") securing Substitute
Building Loan Note B.

                  WHEREAS, pursuant to Section 4.1.37 of the Existing Building
Loan Agreement, the Original Mortgaged Premises were subjected to a declaration
(the "DECLARATION") establishing a plan for condominium ownership of the
Original Mortgaged Premises under the Condominium Act, dated December 4, 2003,
which was recorded on February 3, 2004 in the City Register's Office, New York
County as CRFN#2004000064392, and the Existing Building Loan Mortgage was or
concurrently herewith will be subordinated to the Declaration so that the
description of the property now encumbered by the lien of the Existing Building
Loan Mortgage is as set forth on Part II of Exhibit A hereto.

                  WHEREAS, concurrently herewith, Agent and Lender are entering
into (i) a Partial Release of Lien of Mortgaged Premises No. 1 pursuant to which
the condominium units created pursuant to the Declaration and more particularly
described as "Office Unit 1" and "Office Unit 2" on Part II of Exhibit A hereto
(hereinafter referred to, respectively, as the "BLP UNIT" and the "OFFICE SPEC
UNIT") are being released from the lien of Substitute Building Loan Note
Mortgage A and (ii) a Partial Release of Lien of Mortgaged Premises No. 2
pursuant to which the condominium units created pursuant to the Declaration and
more particularly described as "Retail Unit" and "Residential Unit" on Part II
of Exhibit A hereto (said Units being hereinafter referred to, respectively, as
the "RETAIL UNIT" and the "MASTER RESIDENTIAL UNIT", and collectively as the
"REMAINING PREMISES") are being released from the lien of Substitute Building
Loan Note Mortgage B and Residential Owner is being released from its
obligations and liabilities under Substitute Building Loan Note B and Substitute
Building Loan Mortgage B.

                                       2

<PAGE>

                  WHEREAS, concurrently herewith, after giving effect to the
aforesaid Partial Releases, Agent is assigning to German American Capital
Corporation (the "BLP UNIT LENDER") Substitute Building Loan Note B and
Substitute Building Loan Mortgage B, and BLP Unit Lender is modifying the same
which will no longer be governed by the terms of the Existing Building Loan
Agreement as modified hereby or the other Loan Documents.

                  WHEREAS, in consideration of the foregoing, Borrowers are
concurrently herewith and as a condition of this Amendment, depositing with
Agent cash collateral in the amount of $90,000,000 as additional security for
the Debt and entering into that certain Amendment to Cash Collateral Agreement
dated the date hereof pursuant to which the existing Cash Collateral Agreement
is being amended.

                  WHEREAS, Borrower, Agent and Lenders wish to amend the
Existing Building Loan Agreement to reflect the foregoing premises, all upon the
terms and provisions and subject to the conditions hereinafter set forth.

                  NOW, THEREFORE, in consideration of the agreements set forth
in this Amendment and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:

                               A G R E E M E N T:

         Section 1.        Definitions.

                  (a) In Section 1.1 of the Existing Building Loan Agreement,
the following definitions are hereby amended and restated to read as follows:

                  (i)      "BUILDING LOAN" shall mean the loan made by Lenders
         to Borrower pursuant to the Existing Building Loan Agreement in the
         principal amount of $215,000,000.00, or so much thereof as remains
         outstanding under the Building Loan Note.

                  (ii)     "BUILDING LOAN AMOUNT" shall mean TWO HUNDRED FIFTEEN
         MILLION and NO/100 DOLLARS ($215,000,000.00), or so much thereof as
         remains outstanding under the Building Loan Note. It being acknowledged
         that after the assignment of Substitute Building Loan Note B and
         Substitute Building Loan Mortgage B to the BLP Unit Lender, the amount
         that will remain outstanding on the Building Loan will be NINETY
         MILLION and NO/100 DOLLARS ($90,000,000.00).

                  (iii)    "BUILDING LOAN MORTGAGE" shall mean the Existing
         Building Loan Mortgage prior to the date of the Second Amendment and
         the assignment of Substitute Building Loan Mortgage B to BLP Unit
         Lender, and upon such assignment shall mean the Substitute Building
         Loan Mortgage A encumbering the Remaining Premises.

                  (iv)     "GUARANTY" shall mean, collectively, the Guaranty of
         Completion, the Guaranty of Carrying Costs, each Guaranty of Limited
         Recourse Obligations and the Additional Alexander's Guaranty.

                                       3

<PAGE>

                  (b) In Section 1.1 of the Existing Building Loan Agreement,
the definition of "PROPERTY" is hereby amended to delete the word "Residential"
where it appears in each case before the word "Unit" and to add the following
sentence at the end of such definition: "Notwithstanding the foregoing, for the
purposes of Article V of the Building Loan Agreement and of each of the
Guaranties and the Environmental Indemnity, references therein to "Property"
shall be deemed to continue to refer to the "Property" as defined in and
encumbered by the Existing Building Loan Mortgage, prior to giving effect to any
such release.

                  (c) The defined terms set forth in the Recitals to this
Amendment shall be added to the definitions set forth in Section 1.1 of the
Existing Building Loan Agreement, as the same are amended pursuant to paragraphs
(a) and (b) above, as though each such defined term was set forth in proper
alphabetical order with the other definitions in said Section 1.1, and each
provided that it "shall have the meaning as set forth in the Second Amendment".
In addition, the following definitions are hereby added to the definitions set
forth in Section 1.1 of the Existing Building Loan Agreement, as amended hereby,
in proper alphabetical order:

                  (i)      "ADDITIONAL ALEXANDER'S GUARANTY" shall mean that
         certain Guaranty from Alexander's in favor of Agent dated as of the
         date hereof.

                  (ii)     "ADDITIONAL CASH COLLATERAL" shall have the meaning
         as set forth in Section 6 of the Second Amendment.

                  (iii)    "COMMERCIAL UNIT RELEASE PRICE" shall mean as to the
         Retail Unit, the amount required to be paid to Agent (for the ratable
         benefit of Lenders) for the release of the Retail Unit, which shall be
         equal to $15,000,000.00 less the amount of Excess Residential
         Condominium Unit Sales Proceeds on the date of determination.

                  (iv)     "EXCESS RESIDENTIAL CONDOMINIUM UNIT SALES PROCEEDS"
         shall mean, as of any date of determination, an amount equal to (A) the
         product of (I) the square footage of Residential Units under new
         Qualifying Contracts entered into after the date of the Second
         Amendment (i.e., in excess of the 44,280 square feet of Residential
         Units which are the subject of Qualifying Contracts in existence on the
         date of the Second Amendment), multiplied times (II) the amount by
         which the Net Sales Proceeds per square foot pursuant to such new
         Qualifying Contracts exceeds $800 per square foot or (B)
         $15,000,000.00, whichever is less.

                  (v)      "SECOND AMENDMENT" shall mean that certain Second
         Amendment to Building Loan Agreement dated as of the date hereof
         between Borrower, Agent and the Lenders signatory thereto.

                  (d) All capitalized terms not otherwise defined herein shall
have the respective meanings set forth in the Existing Building Loan Agreement.
The principles of construction set forth in Section 1.2 of the Existing Building
Loan Agreement shall be applicable to this Amendment as if the terms and
provisions of said Section 1.2 were set forth at length herein. References in
the Existing Building Loan Agreement to "this Agreement" "herein," "hereof" or
terms of similar import shall refer to the Existing Building Loan Agreement, as
amended by this Amendment and as the same may, from time to time, hereafter be
amended, modified, extended,

                                       4

<PAGE>

supplemented or restated and shall include all Addendums, Schedules and Exhibits
hereto and thereto. All references in the Original Loan Agreement to "this
Agreement," "herein," "hereof" or terms of similar import shall refer to the
Loan Agreement.

         Section 2.        Building Loan Amount. The parties hereto acknowledge
and confirm that the Building Loan Amount (as defined in the Existing Building
Loan Agreement) has been fully funded in the principal amount of $215,000,000.00
pursuant to the Existing Building Loan Agreement and that Lenders have no
further obligations to make any advances of the Building Loan under the Existing
Building Loan Agreement as amended by this Amendment.

         Section 3.        Extension Option Conditions. The conditions set forth
in clauses (vii) and (viii) of Section 2.1.5(b) of the Existing Building Loan
Agreement are hereby eliminated as conditions to the Borrower's exercising its
option to extend the Loan for the First Extension Period pursuant to said
Section 2.1.5(b) and as conditions to the Borrower's exercising its option to
extend the Loan for the Second Extension Period pursuant to Section 2.1.5(c) of
the Existing Building Loan Agreement.

         Section 4.        Loan Balancing. Agent agrees that in determining
whether any Shortfall exists under Section 2.1.11 of the Building Loan
Agreement, it shall take into consideration the amount of Cash Collateral it is
holding at the time of determination.

         Section 5.        Bloomberg Financials. Section 4.1.6(f) of the
Existing Building Loan Agreement is hereby deleted, and "intentionally deleted"
is inserted in its place.

         Section 6.        Commercial Unit Release. Section 4.1.37(i) of the
Existing Building Loan Agreement is hereby amended to delete, "Intentionally
omitted" and to insert in its stead the following new subsection (i):

                  "(i) (A) Provided that no Event of Default exists under this
                  Agreement, Agent shall release the Retail Unit from the lien
                  of the Building Loan Mortgage, Supplemental Loan Mortgage and
                  Project Loan Mortgage and all other Loan Documents securing
                  the indebtedness evidenced by the Building Loan Note, the
                  Supplemental Loan Note and the Project Loan Note (and from any
                  UCC-1 financing statements executed by Borrower in favor of
                  Agent covering such Units) and Commercial Owner from the
                  obligations and liabilities thereafter arising under this
                  Agreement, the Building Loan Mortgage, Supplemental Loan
                  Mortgage and Project Loan Mortgage and all other Loan
                  Documents securing the indebtedness evidenced by the Building
                  Loan Note, the Supplemental Loan Note and the Project Loan
                  Note except for the Environmental Indemnity and deliver to
                  Borrower a duly executed release(s) in recordable form, a
                  UCC-3 release of security interest and other such documents as
                  may be reasonably required to release the Retail Unit from the
                  lien and/or security interest of the Building Loan Documents,
                  Supplemental Loan Documents and Project Loan Documents and
                  Commercial Owner from such obligations upon satisfaction of
                  each of the following conditions:

                                       5

<PAGE>

                                    (1)      Agent shall have received not less
                           than five (5) Business Days prior written notice of
                           the proposed release accompanied by an officer's
                           Certificate setting forth the Commercial Unit Release
                           Price and the Excess Residential Condominium Unit
                           Sales Proceeds used in the calculation thereof;

                                    (2)      the Unit to be released will
                           constitute one or more tax lots separate and distinct
                           from the tax lot or lots applicable to the remaining
                           portion of the Property encumbered by the liens of
                           the Mortgage;

                                    (3)      the release from the liens of the
                           Mortgage will not violate any applicable zoning or
                           subdivision laws;

                                    (4)      Agent shall have received in cash
                           or by wire transfer of immediately available funds or
                           by certified or bank check payable to Agent the
                           Commercial Unit Release Price; and

                                    (5)      Agent shall have received such
                           other documents, certificates, instruments, opinions
                           or assurances as Agent may reasonably request.

                           (B)      The Commercial Unit Release Price received
                  by Agent under this Section 4.1.37 shall be applied in
                  accordance with subsection (C) below and shall not be deemed a
                  payment until such time.

                           (C)      Amounts received by Agent under this
                  subsection shall be applied on the date received or, at
                  Agent's option, on the date immediately succeeding the
                  expiration of the then current Interest Period (without
                  penalty other than Additional Costs) first to the payment of
                  principal outstanding under the Project Loan Documents, second
                  to the payment of principal outstanding under the Supplemental
                  Loan Documents and third to the payment of principal
                  outstanding under Building Loan Documents. In the event Agent
                  shall have elected not to apply such amounts on the date
                  received, such amounts shall be held by Agent in an interest
                  bearing reserve account and all interest earned therein shall
                  be paid to Borrower. Notwithstanding the foregoing, if the
                  aggregate principal amount outstanding on the Loan less the
                  aggregate amount of Cash Collateral being held by Agent in the
                  Cash Collateral Account does not equal or exceed the
                  Commercial Unit Release Price, then notwithstanding the
                  foregoing, the difference (the "CRP EXCESS"), shall be applied
                  as follows: (1) first, to reduce the unfunded amount of the
                  Supplemental Loan and the Project Loan (in such proportions as
                  the Agent determines in its reasonable discretion based upon
                  the Loan Budget) by (x) the amount of the CRP Excess or (y)
                  the aggregate unfunded amount of the Supplemental Loan and the
                  Project Loan, whichever of (x) or (y) is less, and (2) next,
                  to reduce the aggregate outstanding principal amount of the
                  Project Loan and the Supplemental Loan (in such proportions as
                  the Agent determines in its reasonable discretion based upon
                  the Loan Budget) by the amount of the CRP Excess after
                  application pursuant to clause (1) above in which

                                       6

<PAGE>

                  event a corresponding amount of Project Cash Collateral and
                  Supplemental Cash Collateral as that being applied pursuant to
                  this clause (2) shall be released to Borrower. The amount of
                  the Commercial Unit Release Price, if any, that is applied to
                  reduce the aggregate unfunded amount of the Supplemental Loan
                  and the Project Loan pursuant to clause (1) above shall not be
                  required to be paid to Agent; provided, however, that Borrower
                  shall have the option to deposit the same with Agent pursuant
                  to Section 2.1.11. Nothing contained herein shall be deemed a
                  waiver of Agent's rights pursuant to Section 2.1.11 of the
                  Building Loan Agreement notwithstanding that a Shortfall
                  thereunder may result from the application of the Commercial
                  Unit Release Price as provided herein and Borrower shall be
                  deemed to have been notified by Agent in accordance with said
                  Section 2.1.11 that a Shortfall exists in the amount of the
                  CRP Excess."

         Section 7.        Residential Unit Required Release Price. (a) Section
4.1.37(f) of the Existing Building Loan Agreement is hereby amended by deleting
the semi-colon in the fifth line thereof and all of the text that follows and
replacing the same with a period.

                  (b) In addition, Section 4.1.37(j)(i)(H) of the Existing
Building Loan Agreement is hereby amended by inserting a semi-colon immediately
after the end parenthesis following the defined term "Required Release Price"
and deleting the remaining text beginning with ", provided that so long" through
the end of clause (H).

         Section 8.        Insurance Coverage. (a) Section 5.1.1(a)(i)(A)(V) of
the Existing Building Loan Agreement is hereby amended to delete the
$490,000,000 minimum limit amount, so as to correspond with the obligations of
Borrower under Section 5.1.3(b) of the Existing Building Loan Agreement as
modified hereby.

                  (b) Section 5.1.3(b) of the Existing Building Loan Agreement
is hereby amended to delete "(which amount shall not be required to exceed
$490,000,000)" where it appears.

         Section 9.        Major Casualty or Condemnation. Section 5.3.2 of the
Existing Building Loan Agreement is hereby amended as follows:

                  (a) Section 5.3.2(a)(iii) is hereby deleted in its entirety,
and the following is inserted in its stead:

                  "(iii)   Qualifying Contracts covering not less than 33% of
                  the net saleable area of the Master Residential Unit shall
                  remain in full force and effect during and after the
                  completion of the Restoration without reduction of the
                  purchase prices thereunder, notwithstanding the occurrence of
                  such Casualty or Condemnation;"

                  (b)      In the second to last sentence of Section 5.3.2(i),
which begins with the words, "Notwithstanding the preceding sentence,", the
words "Borrower votes its interests" is hereby deleted and replaced with the
words "the necessary Unit owners under said Section 339-cc vote".

         Section 10.       Events of Default. Section 9.1(a)(v) of the Existing
Building Loan Agreement is hereby deleted, and "intentionally deleted" is
inserted in its place.

                                       7

<PAGE>

         Section 11.       Additional Cash Collateral. In order to induce Agent
and Lenders to enter into this Amendment and the other Amendment Transaction
Loan Documents, simultaneously herewith Borrower is entering into that certain
Amendment to Cash Collateral Agreement and depositing with Agent (for the
ratable benefit of Lenders), as additional collateral for the Loan, the sum of
$90,000,000.00 (the "ADDITIONAL CASH COLLATERAL").

                  (a) Authorization, Conflicts, Enforceability. Borrower
represents, warrants and certifies to Agent and Lenders that the execution,
delivery, and performance of this Amendment and the other documents which are
being executed and delivered in connection herewith by the Borrower have been
duly authorized, executed and delivered by Borrower and will not conflict with,
result in a breach of, or constitute a default under, any of the terms,
conditions or provisions of any of Borrower's organizational documents or any
agreement or instrument to which Borrower is a party or by which it is bound, or
any order or decree applicable to Borrower, or result in the creation or
imposition of any lien on any of Borrower's assets or property (other than
pursuant to the Loan Documents). No consent, approval, authorization or order of
any court or Governmental Authority or other Person is required for the
execution, delivery and performance by Borrower of, or compliance by Borrower
with, this Amendment or the other Amendment Transaction Loan Documents or the
consummation of the transactions contemplated hereby, other than those which
have been obtained by Borrower.

         Section 12.       Filing of Amendment. Borrower shall cause the Title
Company to deliver this Amendment for filing in the County Clerk's Office of New
York County when and as required by Section 22 of the Lien Law. The parties
hereto affirm that the Net Sum Available to Borrower from the Building Loan for
the Improvements as shown on the Lien Law Affidavit filed with the Existing
Building Loan Agreement has been fully funded and that the Net Sum Available to
Borrower from the Building Loan for the Improvements by virtue of the making of,
and after giving effect to, all advances of the proceeds of the Building Loan
previously made is now zero.

         Section 13.       Successors and Assigns. This Amendment shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, subject to Article VIII of the Existing Building Loan
Agreement (and no other Person shall be deemed a benefited party hereunder under
any circumstances).

         Section 14.       No Further Modification. Except as modified and
amended by this Amendment, the Existing Building Loan Agreement shall remain
unmodified and in full force and effect.

         Section 15.       Counterparts. This Amendment may be executed in any
number of counterparts, each of which shall be an original and all of which
shall constitute together but one and the same agreement.

         Section 16.       Section Headings. The Section headings in this
Amendment are included herein for convenience of reference only and shall not
constitute a part of this Amendment for any other purpose.

                                       8

<PAGE>

         Section 17.       Severability. Wherever possible, each provision of
this Amendment shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Amendment shall be prohibited
by or invalid under applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Amendment.

         Section 18.       Governing Law. The governing law provisions of
Section 10.3(A) of the Existing Building Loan Agreement are incorporated herein
by reference as though fully set forth.

                         [NO FURTHER TEXT ON THIS PAGE]

                                       9

<PAGE>

                  IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed by their duly authorized representatives, all as
of the day and year first above written.

                                       BORROWER:

                                       731 COMMERCIAL LLC, a Delaware limited
                                       liability company

                                       By: 731 Commercial Holding LLC,
                                           a Delaware limited liability company,
                                           as member

                                           By: Alexander's, Inc., a Delaware
                                               corporation, member

                                               By: /s/ Brian Kurtz
                                                   _____________________________
                                                   Name: Brian Kurtz
                                                   Title:Assistant Secretary

                                       731 RESIDENTIAL LLC, a Delaware limited
                                       liability company

                                       By: 731 Residential Holding LLC,
                                           a Delaware limited liability company,
                                           as member

                                           By: Alexander's, Inc., a Delaware
                                               corporation, member

                                               By: /s/ Brian Kurtz
                                                   _____________________________
                                                   Name: Brian Kurtz
                                                   Title:Assistant Secretary

<PAGE>

                                       AGENT:

                                       HYPO REAL ESTATE CAPITAL
                                       CORPORATION, AS AGENT

                                       By: /s/ Robert Dowling
                                           _____________________________________
                                           Name: Robert Dowling
                                           Title:Managing Director

                                       By: /s/ William J. Rogers
                                           _____________________________________
                                           Name: William J. Rogers
                                           Title:Managing Director

                                       LENDER:

                                       HYPO REAL ESTATE CAPITAL
                                       CORPORATION

                                       By: /s/ Robert Dowling
                                           _____________________________________
                                           Name: Robert Dowling
                                           Title:Managing Director

                                       By: /s/ William J. Rogers
                                           _____________________________________
                                           Name: William J. Rogers
                                           Title:Managing Director

                                       Lending Office:

                                       622 Third Avenue
                                       29th Floor
                                       New York, New York 10017
                                       Attention: Real Estate Lending

<PAGE>

                                 ACKNOWLEDGMENT

Acknowledgment for Borrower:

STATE OF ___________________________)

                                    ) ss.:

COUNTY OF __________________________)

On the _____ day of January in the year 2004 before me, the undersigned, a
Notary Public in and for said State, personally appeared ______________,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his capacity, that by his
signature on the instrument, the individual, or the person upon behalf of which
the individual acted, executed the instrument, and that such individual(s) made
such appearance before the undersigned in the City/Town of __________, County of
_____________, and State of ____________.

                                       _________________________________________
                                            Signature & office of individual
                                                taking the acknowledgement

<PAGE>

Acknowledgment for Agent:

STATE OF NEW YORK          )
                           ) ss.:
COUNTY OF NEW YORK         )

On the ____ day of February 2004, before me, the undersigned, a notary public in
and for said state, personally appeared ________________________ and
________________________, personally known to me or proved to me on the basis of
satisfactory evidence to be the individuals whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
capacities, and that by their signatures on the instrument, the individuals, or
the person upon behalf of which the individuals acted, executed the instrument.

                                       _________________________________________
                                            Signature & office of individual
                                                taking the acknowledgement

Acknowledgment for Lender:

STATE OF NEW YORK          )
                           ) ss.:
COUNTY OF NEW YORK         )

On the ____ day of February 2004, before me, the undersigned, a notary public in
and for said state, personally appeared ________________________ and
________________________, personally known to me or proved to me on the basis of
satisfactory evidence to be the individuals whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
capacities, and that by their signatures on the instrument, the individuals, or
the person upon behalf of which the individuals acted, executed the instrument.

                                       _________________________________________
                                            Signature & office of individual
                                                taking the acknowledgement

<PAGE>

                                    EXHIBIT A

                          LEGAL DESCRIPTION OF PROPERTY

                                     PART I

                               RESIDENTIAL PARCEL

ALL THAT CERTAIN volume of space, situate, lying and being in the Borough of
Manhattan, County, City and State of New York, bounded and described as follows:

All that portion of the below described parcel lying between a lower horizontal
plane drawn at elevation 512 feet 2 inches above the datum level used by the
Topographical Bureau, Borough of Manhattan, which is 2 feet 9 inches above
National Geodetic Survey Vertical Datum of 1929, mean sea level Sandy Hook, New
Jersey and an upper horizontal plane drawn at 809 feet 2 inches above such datum
level bounded and described as follows:

BEGINNING at a point distant 48 feet 8 inches north of the northerly line of
East 58th Street and 30 feet 9 inches east of easterly line of Lexington Avenue;

RUNNING THENCE northerly, parallel with the easterly line of Lexington Avenue,
12 feet 6 inches;

THENCE westerly, parallel with the northerly line of East 58th Street, 5 feet 10
inches;

THENCE northerly, parallel with the easterly line of Lexington Avenue, 78 feet 6
inches;

THENCE easterly, parallel with the northerly line of East 58th Street, 5 feet 10
inches;

THENCE northerly, parallel with the easterly line of Lexington Avenue, 12 feet 6
inches;

THENCE easterly, parallel with the northerly line of East 58th Street, 103 feet
6 inches;

THENCE southerly, parallel with the easterly line of Lexington Avenue, 7 feet 6
inches;

THENCE easterly, parallel with the northerly line of East 58th Street, 35 feet 0
inches;

THENCE southerly, parallel with the easterly line of Lexington Avenue, 88 feet 6
inches;

<PAGE>

THENCE, westerly, parallel with the northerly line of East 58th Street, 35 feet
0 inches;

THENCE southerly, parallel with the easterly line of Lexington Avenue, 7 feet 6
inches;

THENCE westerly, parallel with the northerly line of East 58th Street, 103 feet
6 inches to the point or place of BEGINNING.

                                COMMERCIAL PARCEL

ALL that certain plot, piece or parcel of land, situate, lying and being in the
Borough of Manhattan, County of New York, City and State of New York, being more
particularly bounded and described as follows:

BEGINNING at the corner formed by the intersection of the northerly line of East
58th Street with the easterly side of Lexington Avenue;

RUNNING THENCE northerly, along the easterly line of Lexington Avenue 200 feet
10 inches to the corner formed by the intersection of the southerly line of East
59th Street with the easterly line of Lexington Avenue;

THENCE easterly, along the southerly line of East 59th Street, 420 feet 0 inches
to the corner formed by the intersection of the southerly line of East 59th
Street with the westerly line of Third Avenue;

THENCE southerly, along the westerly line of Third Avenue, 200 feet 10 inches to
the corner formed by the intersection of the northerly line of East 58th Street
with the westerly line of Third Avenue;

THENCE westerly, along the northerly line of East 58th Street, 420 feet to the
point or place of BEGINNING.

LESS AND EXCEPT:

All that portion of the below described parcel lying between a lower horizontal
plane drawn at elevation 512 feet 2 inches above the datum level used by the
Topographical Bureau, Borough of Manhattan, which is 2 feet 9 inches above
National Geodetic Survey Vertical Datum of 1929, mean sea level Sandy Hook, New
Jersey and an upper horizontal plane drawn at 809 feet 2 inches above such datum
level bounded and described as follows:

BEGINNING at a point distant 48 feet 8 inches north of the northerly line of
East 58th Street and 30 feet 9 inches east of easterly line of Lexington Avenue;

RUNNING THENCE northerly, parallel with the easterly line of Lexington Avenue,
12 feet 6 inches;

THENCE westerly, parallel with the northerly line of East 58th Street, 5 feet 10
inches;

<PAGE>

THENCE northerly, parallel with the easterly line of Lexington Avenue, 78 feet 6
inches;

THENCE easterly, parallel with the northerly line of East 58th Street, 5 feet 10
inches;

THENCE northerly, parallel with the easterly line of Lexington Avenue, 12 feet 6
inches

THENCE easterly, parallel with the northerly line of East 58th Street, 103 feet
6 inches;

THENCE southerly, parallel with the easterly line of Lexington Avenue, 7 feet 6
inches;

THENCE easterly, parallel with the northerly line of East 58th Street, 35 feet 0
inches;

THENCE southerly, parallel with the easterly line of Lexington Avenue, 88 feet 6
inches;

THENCE westerly, parallel with the northerly line of East 58th Street, 35 feet 0
inches;

THENCE southerly, parallel with the easterly line of Lexington Avenue, 7 feet 6
inches;

THENCE westerly, parallel with the northerly line of East 58th Street, 103 feet
6 inches to the point or place of BEGINNING.

SAID RESIDENTIAL PARCEL AND COMMERCIAL PARCEL DESCRIBED IN PART I OF THIS
EXHIBIT A BEING ONE AND THE SAME AS THE FOLLOWING PROPERTY DESCRIBED IN PART II
OF THIS EXHIBIT A

<PAGE>

                                     PART II

                                 (OFFICE UNIT 1)

                  The Condominium Unit (the "Unit") in the premises known as
Beacon Court Condominium and by the street number by the street number 151 East
58th Street, Borough of Manhattan, City, County and State of New York, said Unit
being designated and described as "Office Unit 1" in the declaration (the
"Declaration") establishing a plan for condominium ownership of said premises
under Article 9-B of the Real Property Law of the State of New York (the
"Condominium Act"), dated December 4, 2003, and recorded in the New York County
office of the Register of The City of New York (the "City Register's Office") on
February 3, 2004, in CRFN No. 2004000064392, and also designated as Tax Lot 1002
in Block 1313 of Section 5 of the Borough of Manhattan on the Tax Map of the
Real Property Assessment Department of the City of New York and on the Floor
Plans of said building, certified by Peter Claman, Registered Architect, on
January 29, 2004, and filed in the Real Property Assessment Department of the
City of New York on January 30, 2004 as Condominium Plan No. 1350 also filed in
the City Register's Office on February 3, 2004 in CRFN No. 2004000064393. All
capitalized terms herein which are not separately defined herein will have the
meanings given to those terms in the Declaration or in the by-laws of Beacon
Court Condominium. (Said by-laws, as the same may be amended from time to time,
are hereinafter referred to as the "By-Laws.")

                  TOGETHER with an undivided 49.0559% percentage interest in the
General Common Elements (as such term is defined in the Declaration);

                  TOGETHER with the appurtenances and all the estate and rights
in and to the Unit;

                  TOGETHER with, and subject to, the rights, obligations,
easements, restrictions and other provisions set forth in the Declaration and
the By-Laws, all of which constitute covenants running with the Land and will
bind any person having at any time any interest or estate in (any of) the Unit,
as though recited and stipulated at length herein;

                  The premises within which the Unit is located is more
particularly described as:

                  ALL that certain plot, piece or parcel of land, situate, lying
and being in the borough of Manhattan, County, City and State of New York,
bounded and described as follows:

                  BEGINNING at the corner formed by the intersection of the
southerly side of East 59th Street and the westerly side of Third Avenue;

                  RUNNING THENCE southerly, along the westerly side of Third
Avenue, 200'-10" to the northerly side of East 58th Street;

                  THENCE westerly, along the northerly side of East 58th Street
420' to the easterly side of Lexington Avenue;

                  THENCE northerly along the easterly side of Lexington Avenue,
200'-10" to the southerly side of East 59th Street;

<PAGE>

                  THENCE easterly, along the southerly side of East 59th Street,
420' to the point or place of BEGINNING.

                  TOGETHER with the benefits and SUBJECT to the burdens of the
easements set forth in the deed made by Seven Thirty One Limited Partnership to
59th Street Corporation dated as of 8/1/2001 and recorded 8/8/2001 in Reel 3339
Page 1100.

<PAGE>

                                  (RETAIL UNIT)

                  The Condominium Unit (the "Unit") in the premises known as
Beacon Court Condominium and by the street number by the street number 151 East
58th Street, Borough of Manhattan, City, County and State of New York, said Unit
being designated and described as "Retail Unit" in the declaration (the
"Declaration") establishing a plan for condominium ownership of said premises
under Article 9-B of the Real Property Law of the State of New York (the
"Condominium Act"), dated December 4, 2003, and recorded in the New York County
office of the Register of The City of New York (the "City Register's Office") on
February 3, 2004, in CRFN No. 2004000064392, and also designated as Tax Lot 1001
in Block 1313 of Section 5 of the Borough of Manhattan on the Tax Map of the
Real Property Assessment Department of the City of New York and on the Floor
Plans of said building, certified by Peter Claman, Registered Architect, on
January 29, 2004, and filed in the Real Property Assessment Department of the
City of New York on January 30, 2004 as Condominium Plan No. 1350 also filed in
the City Register's Office on February 3, 2004 in CRFN No. 2004000064393. All
capitalized terms herein which are not separately defined herein will have the
meanings given to those terms in the Declaration or in the by-laws of Beacon
Court Condominium. (Said by-laws, as the same may be amended from time to time,
are hereinafter referred to as the "By-Laws.")

                  TOGETHER with an undivided 13.2894% percentage interest in the
General Common Elements (as such term is defined in the Declaration);

                  TOGETHER with the appurtenances and all the estate and rights
in and to the Unit;

                  TOGETHER with, and subject to, the rights, obligations,
easements, restrictions and other provisions set forth in the Declaration and
the By-Laws, all of which constitute covenants running with the Land and will
bind any person having at any time any interest or estate in (any of) the Unit,
as though recited and stipulated at length herein;

                  The premises within which the Unit is located is more
particularly described as:

                  ALL that certain plot, piece or parcel of land, situate, lying
and being in the borough of Manhattan, County, City and State of New York,
bounded and described as follows:

                  BEGINNING at the corner formed by the intersection of the
southerly side of East 59th Street and the westerly side of Third Avenue;

                  RUNNING THENCE southerly, along the westerly side of Third
Avenue, 200'-10" to the northerly side of East 58th Street;

                  THENCE westerly, along the northerly side of East 58th Street
420' to the easterly side of Lexington Avenue;

                  THENCE northerly along the easterly side of Lexington Avenue,
200'-10" to the southerly side of East 59th Street;

<PAGE>

                  THENCE easterly, along the southerly side of East 59th Street,
420' to the point or place of BEGINNING.

                  TOGETHER with the benefits and SUBJECT to the burdens of the
easements set forth in the deed made by Seven Thirty One Limited Partnership to
59th Street Corporation dated as of 8/1/2001 and recorded 8/8/2001 in Reel 3339
Page 1100.

<PAGE>

                                 (OFFICE UNIT 2)

                  The Condominium Unit (the "Unit") in the premises known as
Beacon Court Condominium and by the street number by the street number 151 East
58th Street, Borough of Manhattan, City, County and State of New York, said Unit
being designated and described as "Office Unit 2" in the declaration (the
"Declaration") establishing a plan for condominium ownership of said premises
under Article 9-B of the Real Property Law of the State of New York (the
"Condominium Act"), dated December 4, 2003, and recorded in the New York County
office of the Register of The City of New York (the "City Register's Office") on
February 3, 2004, in CRFN No. 2004000064392, and also designated as Tax Lot 1003
in Block 1313 of Section 5 of the Borough of Manhattan on the Tax Map of the
Real Property Assessment Department of the City of New York and on the Floor
Plans of said building, certified by Peter Claman, Registered Architect, on
January 29, 2004, and filed in the Real Property Assessment Department of the
City of New York on January 30, 2004 as Condominium Plan No. 1350 also filed in
the City Register's Office on February 3, 2004 in CRFN No. 2004000064393. All
capitalized terms herein which are not separately defined herein will have the
meanings given to those terms in the Declaration or in the by-laws of Beacon
Court Condominium. (Said by-laws, as the same may be amended from time to time,
are hereinafter referred to as the "By-Laws.")

                  TOGETHER with an undivided 14.0095% percentage interest in the
General Common Elements (as such term is defined in the Declaration);

                  TOGETHER with the appurtenances and all the estate and rights
in and to the Unit;

                  TOGETHER with, and subject to, the rights, obligations,
easements, restrictions and other provisions set forth in the Declaration and
the By-Laws, all of which constitute covenants running with the Land and will
bind any person having at any time any interest or estate in (any of) the Unit,
as though recited and stipulated at length herein;

                  The premises within which the Unit is located is more
particularly described as:

                  ALL that certain plot, piece or parcel of land, situate, lying
and being in the borough of Manhattan, County, City and State of New York,
bounded and described as follows:

                  BEGINNING at the corner formed by the intersection of the
southerly side of East 59th Street and the westerly side of Third Avenue;

                  RUNNING THENCE southerly, along the westerly side of Third
Avenue, 200'-10" to the northerly side of East 58th Street;

                  THENCE westerly, along the northerly side of East 58th Street
420' to the easterly side of Lexington Avenue;

                  THENCE northerly along the easterly side of Lexington Avenue,
200'-10" to the southerly side of East 59th Street;

                  THENCE easterly, along the southerly side of East 59th Street,
420' to the point or place of BEGINNING.

<PAGE>

                  TOGETHER with the benefits and SUBJECT to the burdens of the
easements set forth in the deed made by Seven Thirty One Limited Partnership to
59th Street Corporation dated as of 8/1/2001 and recorded 8/8/2001 in Reel 3339
Page 1100.

<PAGE>

                               (RESIDENTIAL UNIT)

                  The Condominium Unit (the "Unit") in the premises known as
Beacon Court Condominium and by the street number by the street number 151 East
58th Street, Borough of Manhattan, City, County and State of New York, said Unit
being designated and described as "Residential Unit" in the declaration (the
"Declaration") establishing a plan for condominium ownership of said premises
under Article 9-B of the Real Property Law of the State of New York (the
"Condominium Act"), dated December 4, 2003, and recorded in the New York County
office of the Register of The City of New York (the "City Register's Office") on
February 3, 2004, in CRFN No. 2004000064392, and also designated as Tax Lot 1004
in Block 1313 of Section 5 of the Borough of Manhattan on the Tax Map of the
Real Property Assessment Department of the City of New York and on the Floor
Plans of said building, certified by Peter Claman, Registered Architect, on
January 29, 2004, and filed in the Real Property Assessment Department of the
City of New York on January 30, 2004 as Condominium Plan No. 1350 also filed in
the City Register's Office on February 3, 2004 in CRFN No. 2004000064393. All
capitalized terms herein which are not separately defined herein will have the
meanings given to those terms in the Declaration or in the by-laws of Beacon
Court Condominium. (Said by-laws, as the same may be amended from time to time,
are hereinafter referred to as the "By-Laws.")

                  TOGETHER with an undivided 23.6452% percentage interest in the
General Common Elements (as such term is defined in the Declaration);

                  TOGETHER with the appurtenances and all the estate and rights
in and to the Unit;

                  TOGETHER with, and subject to, the rights, obligations,
easements, restrictions and other provisions set forth in the Declaration and
the By-Laws, all of which constitute covenants running with the Land and will
bind any person having at any time any interest or estate in (any of) the Unit,
as though recited and stipulated at length herein;

                  The premises within which the Unit is located is more
particularly described as:

                  ALL that certain plot, piece or parcel of land, situate, lying
and being in the borough of Manhattan, County, City and State of New York,
bounded and described as follows:

                  BEGINNING at the corner formed by the intersection of the
southerly side of East 59th Street and the westerly side of Third Avenue;

                  RUNNING THENCE southerly, along the westerly side of Third
Avenue, 200'-10" to the northerly side of East 58th Street;

                  THENCE westerly, along the northerly side of East 58th Street
420' to the easterly side of Lexington Avenue;

                  THENCE northerly along the easterly side of Lexington Avenue,
200'-10" to the southerly side of East 59th Street;

<PAGE>

                  THENCE easterly, along the southerly side of East 59th Street,
420' to the point or place of BEGINNING.

                  TOGETHER with the benefits and SUBJECT to the burdens of the
easements set forth in the deed made by Seven Thirty One Limited Partnership to
59th Street Corporation dated as of 8/1/2001 and recorded 8/8/2001 in Reel 3339
Page 1100.