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UNITED STATESSECURITIES AND EXCHANGE COMMISSION  FORM 10-Q (Mark One)[X]
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2004 OR [  ]
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from _______________________________ to ______________________________________________________ Commission File Number 001-6064 ALEXANDERS, INC. 
  Delaware
(State or other jurisdiction of incorporation or
organization)
    
    51-0100517
(I.R.S. Employer Identification No.)210 Route 4 East, Paramus, New Jersey
(Address of principal executive offices)
    
    07652
(Zip Code)
 (201) 587-8541 
  N/A 
  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. [X] Yes [  ] No Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). [X] Yes [  ] No As of April 23, 2004, there were 5,005,850 shares of common stock, par value $1
per share, outstanding.




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ALEXANDERS, INC. AND SUBSIDIARIES
INDEX Page NumberPART I.
    Financial InformationItem 1.
    
    Financial Statements:Consolidated Balance Sheets as of March 31, 2004 (unaudited) and December 31, 2003
    
    
    3Consolidated Statements of Operations (unaudited) for the Three Months Ended March 31, 2004 and March 31, 2003
    
    
    4Consolidated Statements of Cash Flows (unaudited) for the Three Months Ended March 31, 2004 and March 31, 2003
    
    
    5Notes to Consolidated Financial Statements (unaudited)
    
    
    6Independent
Accountants Report
    
    
    12Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    13Item 3.
    
    Quantitative and Qualitative Disclosures about Market Risk
    
    
    18Item 4.
    
    Control and Procedures
    
    
    18PART II.
    Other InformationItem 1.
    
    Legal Proceedings
    
    
    19Item 6.
    
    Exhibits and Reports on Form 8-K
    
    
    19Signatures
    
    
    
    
    20Exhibit Index
    
    
    
    
    21LETTERCERTIFICATIONCERTIFICATIONCERTIFICATIONCERTIFICATION
  2




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PART I. FINANCIAL INFORMATION 
 Item 1.Financial Statements ALEXANDERS, INC. AND SUBSIDIARIES 
 CONSOLIDATED BALANCE SHEETS
  March 31,
    
    December 31,2004
    
    2003(Unaudited)ASSETSReal estate, at cost:Land
    
    $
    92,008
    
    
    $
    91,928Buildings, leaseholds and leasehold improvements
    
    
    439,856
    
    
    
    371,353Construction in progress
    
    
    314,731
    
    
    
    346,166Air rights acquired for Lexington Avenue Development
    
    
    17,531
    
    
    
    17,531Total
    
    
    864,126
    
    
    
    826,978Accumulated depreciation and amortization
    
    
    (65,324
    )
    
    
    (62,744
    )Real estate, net
    
    
    798,802
    
    
    
    764,234Cash and cash equivalents
    
    
    119,485
    
    
    
    21,336Escrow deposits and restricted cash
    
    
    40,100
    
    
    
    16,291Accounts receivable, net of allowance for doubtful accounts of $100 and
$55
    
    
    6,231
    
    
    
    3,101Receivable arising from the straight-lining of rents
    
    
    39,095
    
    
    
    27,412Deferred lease and other property costs (including unamortized leasing fees
to Vornado Realty Trust (Vornado) of $34,605 and $31,021), net
    
    
    64,786
    
    
    
    61,594Deferred debt expense, net
    
    
    16,043
    
    
    
    10,806Other assets
    
    
    6,573
    
    
    
    16,222TOTAL ASSETS
    
    $
    1,091,115
    
    
    $
    920,996LIABILITIES AND STOCKHOLDERS EQUITYDebt (including $124,000 due to Vornado)
    
    $
    889,863
    
    
    $
    731,485Amounts due to Vornado
    
    
    39,471
    
    
    
    34,427Accounts payable and accrued expenses
    
    
    34,409
    
    
    
    47,402Liability for stock appreciation rights
    
    
    74,956
    
    
    
    44,917Other liabilities
    
    
    24,134
    
    
    
    11,842TOTAL LIABILITIES
    
    
    1,062,833
    
    
    
    870,073COMMITMENTS AND CONTINGENCIESSTOCKHOLDERS EQUITYPreferred stock: $1.00 par value per share; authorized, 3,000,000 shares;
issued, none
    
    
    
    
    
    
    Common stock: $1.00 par value per share; authorized, 10,000,000 shares;
issued, 5,173,450 shares
    
    
    5,174
    
    
    
    5,174Additional capital
    
    
    25,166
    
    
    
    24,843Retained
(deficit) earnings
    
    
    (1,126
    )
    
    
    21,86629,214
    
    
    
    51,883Treasury shares: 167,600 and 172,600 shares at cost
    
    
    (932
    )
    
    
    (960
    )TOTAL STOCKHOLDERS EQUITY
    
    
    28,282
    
    
    
    50,923TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
    
    $
    1,091,115
    
    
    $
    920,996
 See notes to consolidated financial statements. 3




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ALEXANDERS, INC. AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (UNAUDITED)
  Three Months EndedMarch 31,2004
    
    2003REVENUESProperty rentals
    
    $
    24,567
    
    
    $
    12,823Expense reimbursements
    
    
    9,198
    
    
    
    6,900Total revenues
    
    
    33,765
    
    
    
    19,723EXPENSESOperating (including management fees to Vornado of $379 and $363)
    
    
    10,496
    
    
    
    9,309General and administrative (including stock appreciation rights
compensation expense of $30,039 in 2004 and management fees of
$540 to Vornado in each period)
    
    
    31,205
    
    
    
    926Depreciation and amortization
    
    
    3,530
    
    
    
    1,607Total expenses
    
    
    45,231
    
    
    
    11,842OPERATING (LOSS) INCOME
    
    
    (11,466
    )
    
    
    7,881Interest and other income, net
    
    
    458
    
    
    
    123Interest and debt expense (including interest on loans from Vornado)
    
    
    (8,934
    )
    
    
    (3,200
    )Write off of unamortized deferred debt expense
    
    
    (3,050
    )
    
    
    NET (LOSS) INCOME
    
    $
    (22,992
    )
    
    $
    4,804Net (loss) income per common share (basic and diluted)
    
    $
    (4.60
    )
    
    $
    0.96
 See notes to consolidated financial statements. 4




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ALEXANDERS, INC. AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (UNAUDITED)
  Three Months Ended March 31,2004
    
    2003CASH FLOWS FROM OPERATING ACTIVITIESNet (loss) income
    
    $
    (22,992
    )
    
    $
    4,804Adjustments to reconcile net (loss) income to net cash provided by
operating activities:Write-off of unamortized deferred debt expense
    
    
    3,050
    
    
    
    Depreciation and amortization (including deferred debt expense)
    
    
    4,389
    
    
    
    2,574Straight-lining of rental income
    
    
    (11,683
    )
    
    
    (560
    )Change in operating assets and liabilities:Accounts receivable, net
    
    
    (3,130
    )
    
    
    (207
    )Amounts due to Vornado
    
    
    3,629
    
    
    
    (644
    )Accounts payable and accrued expenses
    
    
    1,878
    
    
    
    792Liability
for stock appreciation rights
    
    
    30,039
    
    
    
    Other liabilities
    
    
    (58
    )
    
    
    (95
    )Other
    
    
    (1,716
    )
    
    
    2,781Net cash provided by operating activities
    
    
    3,406
    
    
    
    9,445CASH FLOWS FROM INVESTING ACTIVITIESAdditions to real estate
    
    
    (50,612
    )
    
    
    (61,574
    )Cash restricted for operating liabilities
    
    
    (15,503
    )
    
    
    (2,932
    )Restricted cash made available for operating liabilities
    
    
    4,043
    
    
    
    72Net cash used in investing activities
    
    
    (62,072
    )
    
    
    (64,434
    )CASH FLOWS FROM FINANCING ACTIVITIESProceeds from borrowings
    
    
    412,630
    
    
    
    24,518Repayments of borrowings
    
    
    (254,252
    )
    
    
    (717
    )Deferred debt expense
    
    
    (1,914
    )
    
    
    Exercise of share options
    
    
    351
    
    
    
    Net cash provided by financing activities
    
    
    156,815
    
    
    
    23,801Net increase (decrease) in cash and cash equivalents
    
    
    98,149
    
    
    
    (31,188
    )Cash and cash equivalents at beginning of period
    
    
    21,336
    
    
    
    45,239Cash and cash equivalents at end of period
    
    $
    119,485
    
    
    $
    14,051SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATIONCash payments for interest (of which $6,729 and $8,731 have been
capitalized)
    
    $
    13,670
    
    
    $
    10,914
 See notes to consolidated financial statements. 5




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ALEXANDERS, INC. AND SUBSIDIARIES 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 (UNAUDITED)
 1. ORGANIZATION Alexanders, Inc. is a real estate investment trust (REIT), incorporated
in Delaware, engaged in leasing, managing, developing and redeveloping its
properties. The activities of Alexanders, Inc. are conducted through its
manager, Vornado Realty Trust (Vornado). 2. BASIS OF PRESENTATION The consolidated balance sheet as of March 31, 2004, the consolidated
statements of operations for the three months ended March 31, 2004 and 2003,
and the consolidated statements of cash flows for the three months ended March
31, 2004 and 2003 are unaudited. In the opinion of management, all adjustments
(which include only normal recurring adjustments) necessary to present fairly
the financial position, results of operations and cash flows have been made.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with accounting principles generally accepted
in the United States of America have been condensed or omitted in accordance
with Article 10 of Regulation S-X and the instructions to Form 10-Q. These
consolidated financial statements should be read in conjunction with the
consolidated financial statements and notes thereto included in the Annual
Report on Form 10-K of Alexanders, Inc. for the year ended December 31, 2003
as filed with the Securities and Exchange Commission. The results of
operations for the three months ended March 31, 2004 are not necessarily
indicative of the operating results for the full year. The accompanying consolidated financial statements include the accounts of
Alexanders, Inc. and all of its wholly owned subsidiaries (collectively, the
Company). All significant intercompany amounts have been eliminated. The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting periods. Actual results could differ from those
estimates. Certain amounts in the prior periods consolidated financial
statements have been reclassified to conform to the current period
presentation. The Company currently operates in one business segment. 3. RELATIONSHIP WITH VORNADO REALTY TRUST Vornado owned 33.0% of the common stock of Alexanders, Inc. as of March
31, 2004. Steven Roth is the Chief Executive Officer and a director of the
Company, the Managing General Partner of Interstate Properties (Interstate),
a New Jersey general partnership, and the Chairman of the Board and Chief
Executive Officer of Vornado. At March 31, 2004, Mr. Roth, Interstate and its
other two general partners, David Mandelbaum and Russell B. Wight, Jr. (who are
also directors of the Company and trustees of Vornado) owned, in the aggregate,
27.5% of the outstanding common stock of Alexanders, Inc., in addition to the
common stock owned directly by Vornado, and 11.2% of the outstanding common
shares of beneficial interest of Vornado. The Company is managed, and its properties are leased, by Vornado pursuant
to management, leasing and development agreements with one-year terms, expiring
in March of each year, which are automatically renewable. In conjunction with
the original closing of the Lexington Avenue construction loan (the
Construction Loan) on July 3, 2002, these agreements were modified to cover
the Companys Lexington Avenue property separately. Further, the management
and development agreements with Vornado for the Lexington Avenue property were
amended to provide for a term lasting until substantial completion of the
property with automatic renewals, and for the payment of the Lexington Avenue
development fee upon the earlier of January 3, 2006 or the repayment fully of
the Construction Loan encumbering the property. Vornado has agreed to guarantee to the construction lender, the lien free,
timely completion of the construction of the Lexington Avenue project and
funding of project costs in excess of a stated loan budget, if not funded by
the Company (the Completion Guarantee). The $6,300,000 estimated fee payable
by the Company to Vornado for the Completion Guarantee is 1% of construction
costs, as defined, and is due at the same time that the development fee is due.
This development fee is estimated to be $26,300,000. In addition, if Vornado
should advance any funds under the Completion Guarantee in excess of
$21,000,000, which is the amount available at 6




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ALEXANDERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) March 31, 2004 under the line of credit with Vornado, discussed below,
interest on those advances would be at 15% per annum. The annual fees payable by the Company to Vornado consist of (i) an annual
management fee of $3,000,000 plus 3% of the gross income from the Kings Plaza
Mall, (ii) a development fee equal to 6% of development costs, as defined, with
minimum guaranteed fees of $750,000 per annum, and (iii) a leasing fee. The
leasing fee to Vornado is equal to (a) 3% of the gross proceeds, as defined,
from the sale of an asset and (b) in the event of a lease or sublease of an
asset, 3% of lease rent for the first ten years of a lease term, 2% of lease
rent for the eleventh through the twentieth year of a lease term, and 1% of
lease rent for the twenty-first through thirtieth year of a lease term, subject
to the payment of rents by tenants. Such amounts are payable annually in an
amount not to exceed $2,500,000, until the present value of such installments,
calculated at a discount rate of 9% per annum, equals the amount that would
have been paid had they been paid at the time the transactions which gave rise
to the commissions occurred. Pursuant to the leasing agreement, in the event
third party real estate brokers are used, the fees to Vornado increase by 1%.
Vornado is responsible for the fees to the third party real estate brokers,
except in connection with the Bloomberg L.P. lease, where the tenant paid the
third party broker directly. At March 31, 2004, the Company owed Vornado (A) $15,890,000 in development
fees, (B) $18,215,000 in leasing fees, (C) $4,233,000 for the guarantee fee,
(D) $741,000 in interest, and (E) $392,000 in management fees and other costs. The following table shows the amounts accrued under the management,
leasing and development agreements. Three Months EndedMarch 31,(amounts in thousands)
    
    2004
    
    2003Management fee
    
    $
    919
    
    
    $
    903Development fee, guarantee fee,
maintenance services and rent for
development office
    
    
    1,703
    (1)
    
    
    3,371Leasing and other fees
    
    
    1,198
    
    
    
    535$

    3,820
    
    
    $
    4,809
   (1)
 At March 31, 2004, in addition to the fees and costs described above, the
Company was indebted to Vornado in the amount of $124,000,000 comprised of (i)
a $95,000,000 note and (ii) $29,000,000 under a $50,000,000 line of credit
(which carries a 1% unused commitment fee). The current interest rate on the
loan and line of credit is 12.48% and resets quarterly using a 9.48% spread to
one-year treasuries with a 3% floor for treasuries. On July 3, 2002, in
conjunction with the original closing of the Construction Loan, the maturity of
the Vornado debt was extended to the earlier of January 3, 2006 or the date the
Construction Loan is finally repaid. The Company incurred interest (including
the 1% unused commitment fee) on this debt of $3,965,000 and $3,778,000 in the
three months ended March 31, 2004 and 2003, respectively. 4. LEXINGTON AVENUE PROJECT The development at Lexington Avenue consists of an approximately 1.3
million square foot multi-use building. The building will contain
approximately 885,000 net rentable square feet of office space (of which
695,000 square feet has been leased and delivered to Bloomberg L.P.),
approximately 171,000 net rentable square feet of retail space and
approximately 248,000 net saleable square feet of residential space consisting
of condominium units (through a taxable REIT subsidiary). Of the construction
budget of $630,000,000 (which excludes $29,000,000 for development and
guarantee fees to Vornado), $434,500,000 has been expended through March 31,
2004 and an additional $48,900,000 has been committed to at March 31, 2004.
Construction is expected to be completed in 2005. At March 31, 2004, 115,000 square feet of retail space has been leased, of
which The Home Depot and Hennes & Mauritz have leased 83,000 and 27,000 square
feet, respectively. On March 29, 2004, the Company 7




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ALEXANDERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) delivered the 83,000 square feet leased to The Home Depot. The Company
expects to deliver the 27,000 square feet leased to Hennes & Mauritz during the
second quarter of 2004. Payment of base rent commences six to nine months
from delivery of each space; rent recognition commences on delivery of space.
In the three months ended March 31, 2004, the Company transferred approximately
$68,576,000 from Construction in progress to Land and Buildings,
leaseholds and leasehold improvements, representing the space delivered to The
Home Depot and the remainder of the space delivered to Bloomberg L.P. The residential space is comprised of 105 condominium units. The original
offering plan filed for these units, as amended for price increases through
March 31, 2004, would produce (reflecting the value of existing contracts and
the offering price for the remaining units) an aggregate sale price of
$507,000,000. As of March 31, 2004, the Company has received deposits of
$22,774,000 on sales of the condominium units. Financing of the Project On February 13, 2004, the Company completed a $400,000,000 mortgage
financing on the office space. The loan was placed by German American Capital
Corporation, an affiliate of Deutsche Bank. The loan bears interest at 5.33%,
matures in February 2014 and beginning in the third year, provides for
principal payments based on a 25-year amortization schedule such that over the
remaining eight years of the loan, ten years of amortization will be paid.
$253,529,000 of the loan proceeds was used to repay the entire amount
outstanding under the previously existing Construction Loan with Hypo Real
Estate Capital Corporation. Included in the Consolidated Balance
Sheet in Deferred debt expense, net is $9,146,000 of
financing costs which have been deferred to be amortized over the
loan term; $7,223,000 of these costs were incurred prior to, and
included in Other assets at, December 31, 2003. The Construction Loan was modified so that the remaining availability is
$237,000,000, which was approximately the amount estimated to complete the
Lexington Avenue development project at the closing date (not including $29,000,000 for development
and guarantee fees to Vornado). The interest rate of the Construction Loan of
LIBOR plus 2.5% (3.60% at March 31, 2004) and the maturity date of January
2006, with two one-year extensions, were not changed. The collateral for the
Construction Loan is the same except that the office space has been removed
from the lien. Further, the Construction Loan permits the release of the
retail space for a payment of $15 million and requires all proceeds from the
sale of the residential condominium units to be applied to the Construction
Loan balance until it is finally repaid. In connection with reducing the
principal amount of the Construction Loan, the Company wrote off $3,050,000,
the proportionate share of unamortized deferred debt expense, in the first
quarter of 2004 (shown in the Consolidated Statements of Operations as Write
off of unamortized deferred debt expense). Vornado has agreed to guarantee to
the construction lender, the lien free, timely completion of the construction
of the Lexington Avenue project and funding of project costs in excess of a
stated loan budget, if not funded by the Company. If Vornado should advance
any funds under the Completion Guarantee in excess of $21,000,000, which is the
amount available at March 31, 2004 under the line of credit with Vornado,
interest on those advances would be at 15% per annum. There can be no assurance that the Lexington Avenue project will be
completed on time or completed for the budgeted amount. Any failure to
complete the Lexington Avenue project on time or within budget may adversely
affect future cash flows and the Companys financial condition. 5. LEASES The Company leases space to tenants in retail centers and an office
building. Future base rental revenue under these non-cancelable operating
leases (other than leases which have not commenced, including the Hennes &
Mauritz lease) is as follows: (amounts in thousands) Year Ending December 31,2004
    
    $
    54,9682005
    
    
    81,6802006
    
    
    80,1322007
    
    
    77,0142008
    
    
    80,306Thereafter
    
    
    1,541,339
 8




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ALEXANDERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) Bloomberg L.P. and Sears accounted for 38% and 12% of the Companys
consolidated revenues in the three months ended March 31, 2004, respectively.
Sears accounted for 20% of revenues in the three months ended March 31, 2003. 6. DEBT The following is a summary of the Companys outstanding debt. InterestRate at
    
    Balance atMarch 31,
    
    March 31,
    
    December 31,(amounts in thousands except for percentages)
    
    Maturity
    
    2004
    
    2004
    
    2003First mortgage, secured by the office space at
the Lexington Avenue property
    
    Feb. 2014
    
    
    5.33
    %
    
    $
    400,000
    
    
    
    First mortgage, secured by the Kings Plaza
Regional
Shopping Center
    
    June 2011
    
    
    7.46
    %
    
    
    215,863
    
    
    $
    216,586Term loan and line of credit to Vornado
    
    Jan. 2006
    
    
    12.48
    %
    
    
    124,000
    
    
    
    124,000First mortgage, secured by the Rego Park I
Shopping Center
    
    June 2009
    
    
    7.25
    %
    
    
    82,000
    
    
    
    82,000First mortgage, secured by the Paramus property
    
    Oct. 2011
    
    
    5.92
    %
    
    
    68,000
    
    
    
    68,000Construction loan, secured by the retail and
residential space at the Lexington Avenue
property
    
    Jan. 2006
    
    
    3.60
    %
    
    
    
    
    
    
    240,899$
    889,863
    
    
    $
    731,485
 At March 31, 2004, the principal repayments for the next five years and
thereafter are as follows: (amounts in thousands) Year Ending December 31,2004
    
    $
    2,5032005
    
    
    3,8952006
    
    
    128,1982007
    
    
    4,5262008
    
    
    4,817Thereafter
    
    
    745,924
 7. COMMITMENTS AND CONTINGENCIES Neither Alexanders, Inc. nor any of its subsidiaries is a party to, nor
is their property the subject of, any material pending legal proceeding other
than routine litigation incidental to their businesses. The Company believes
that these routine legal actions will not be material to the Companys
financial condition or results of operations. Insurance The Company carries comprehensive liability and all-risk property
insurance (fire, flood, extended coverage and rental loss insurance) with
respect to its assets but is at risk for financial loss in excess of the
policies limits. Such a loss could be material. On November 26, 2002, the Terrorism Risk Insurance Act of 2002 was signed
into law. Under this new legislation, through 2005, regulated insurers must offer coverage in their commercial
property and casualty policies (including existing policies) for losses
resulting from defined acts of terrorism. As a result of the legislation, in
June 2003, the Company obtained $500,000,000 of coverage per occurrence for
certified terrorist acts, as defined in the legislation, and $150,000,000 per
occurrence for non-certified 9




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ALEXANDERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) acts. In addition, on February 13, 2004, the Company increased the
builders risk insurance coverage for its Lexington Avenue project, which
includes full coverage for certified terrorist acts, per occurrence, and
$200,000,000 for non-certified acts, per occurrence. Therefore, the Company is
at risk for financial loss in excess of these limits for terrorist acts, as
defined by the policies and the legislation. Such loss could be material. The Companys debt instruments, consisting of mortgage loans secured by
its properties (which are generally non-recourse to the Company), contain
customary covenants requiring the Company to maintain insurance. There can be
no assurance that the lenders under these instruments will not take the
position that a future exclusion from all-risk insurance coverage for losses
due to terrorist acts is a breach of these debt instruments, allowing the
lenders to declare an event of default and accelerate repayment of debt. In
addition, if lenders insist on coverage for these risks and the Company is
unable to obtain coverage once the Terrorism Risk Insurance Act of 2002 has
lapsed, it may adversely affect the Companys ability to finance and/or
refinance its properties and businesses. Environmental Remediation In June 1997, the Kings Plaza Regional Shopping Center commissioned an
Environmental Study and Contamination Assessment Site Investigation (the Phase
II Study) to evaluate and delineate environmental conditions disclosed in a
Phase I study. The results of the Phase II Study indicated the presence of
petroleum and bis (2-ethylhexyl) phthalate contamination in the soil and
groundwater. The Company has delineated the contamination and has developed a
remediation approach, which is ongoing. The New York State Department of
Environmental Conservation (NYDEC) has approved a portion of the remediation
approach. The Company accrued $2,675,000 in previous years, of which
$2,481,000 has been paid as of March 31, 2004, for its estimated obligation
with respect to the cleanup of the site, and which includes costs of (i)
remedial investigation, (ii) feasibility studies, (iii) remedial design, (iv)
remedial action and (v) professional fees. Costs of future expenditures for
these environmental remediation obligations were not discounted to their
present value. If NYDEC insists on a more extensive remediation approach, the
Company could incur additional obligations. The Company has concluded that the large majority of the contamination at
the site is historic and the result of past activities of third parties.
Although the Company is pursuing claims against potentially responsible third
parties, and negotiations are ongoing with a former owner of the property,
there can be no assurance as to the extent that the Company will be successful
in obtaining recovery from such parties of the remediation costs incurred. In
addition, the costs associated with further pursuit of responsible parties may
be prohibitive. The Company has not recorded an asset as of March 31,
2004 for possible recoveries of environmental remediation costs from
potentially responsible third parties. Kings Plaza The Company plans to construct a two-story freestanding building adjacent
to the Kings Plaza Mall of approximately 200,000 square feet. The first story
of approximately 120,000 square feet will be operated as a Lowes Home
Improvement Warehouse (Lowes). The Lowes lease is expected to commence in
2006. The cost of the project will be approximately $13,000,000 to $15,000,000,
net of a reimbursement from Lowes and before reimbursement, if any, from the
second story tenant(s). There can be no assurance that this project will be
completed, completed on time or completed for the budgeted amount. Letters of Credit Approximately $4,130,000 in standby letters of credit were issued at March
31, 2004. 10




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##### Table of Contents



ALEXANDERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) 8. EARNINGS PER SHARE The following table sets forth the computation of basic and diluted (loss)
income per share. Three Months Ended March 31,(amounts in thousands except share and per share amounts)
    
    2004
    
    2003Numerator:Net (loss) income
    
    $
    (22,992
    )
    
    $
    4,804Denominator:Denominator (basic and diluted)  weighted average
shares
    
    
    5,002,169
    
    
    
    5,000,850Net (loss) income per common share (basic and diluted)
    
    $
    (4.60
    )
    
    $
    0.96
 Options to purchase 100,000 shares of the common stock of Alexanders Inc.
were not included in the calculation of net loss per share for the three months
ended March 31, 2004 as they are anti-dilutive. Options to purchase 105,000
shares of the common stock of Alexanders, Inc. were not included in the
calculation of net income per share in the three months ended March 31, 2003 as
the average market price of the common stock was less than the exercise price. 9. SUBSEQUENT EVENT Effective
April 1, 2004, Vornado modified its term loan and line of credit
to the Company to reduce the spread it charges from 9.48% to 6%.
Accordingly, the current interest rate has been reduced to 9% from
12.48%. 11




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##### Table of Contents



INDEPENDENT ACCOUNTANTS REPORT Board of Directors and Stockholders of Alexanders, Inc.
Paramus, New Jersey We have reviewed the accompanying condensed consolidated balance sheet of
Alexanders Inc. and Subsidiaries as of March 31, 2004, and the related
condensed consolidated statements of income and cash flows for the three-month
periods ended March 31, 2004 and 2003. These financial statements are the
responsibility of the Companys management. We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and of making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted
in accordance with auditing standards generally accepted in the United States
of America, the objective of which is the expression of an opinion regarding
the financial statements taken as a whole. Accordingly, we do not express such
an opinion. Based on our reviews, we are not aware of any material modifications that
should be made to such condensed consolidated financial statements for them to
be in conformity with accounting principles generally accepted in the United
States of America. We have previously audited, in accordance with auditing standards
generally accepted in the United States of America, the consolidated balance
sheet of Alexanders Inc. and Subsidiaries as of December 31, 2003, and the
related consolidated statements of income, shareholders equity, and cash flows
for the year then ended (not presented herein); and in our report dated March
2, 2004, we expressed an unqualified opinion on those consolidated financial
statements. In our opinion, the information set forth in the accompanying
condensed consolidated balance sheet as of December 31, 2003 is fairly stated,
in all material respects, in relation to the consolidated balance sheet from
which it has been derived. DELOITTE & TOUCHE LLP Parsippany, New Jersey
May 5, 2004 12




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##### Table of Contents



ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Certain statements contained herein and throughout this Quarterly Report
on Form 10-Q constitute forward-looking statements as such term is defined in
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Forward-looking statements are
not guarantees of performance. The Companys future results, financial
condition, results of operations and business may differ materially from those
expressed in these forward-looking statements. You can find many of these
statements by looking for words such as believes, expects, anticipates,
estimates, intends, plans, would, may, will or other similar
expressions in this Quarterly Report on Form 10-Q. These forward-looking
statements represent our intentions, plans, expectations and beliefs and are
subject to numerous assumptions, risks and uncertainties. Many of the factors
that will determine these items are beyond our ability to control or predict.
Factors that might cause such a material difference include, but are not
limited to: (a) national, regional and local economic conditions; (b) the
consequences of any armed conflict involving, or terrorist attack against, the
United States; (c) our ability to secure adequate insurance; (d) local
conditions, such as an oversupply of space or a reduction in demand for real
estate in the area; (e) competition from other available space; (f) whether
tenants consider a property attractive; (g) the financial condition of our
tenants, including the extent of tenant bankruptcies or defaults; (h) whether
we are able to pass some or all of any increased operating costs we incur
through to our tenants; (i) how well we manage our properties; (j) any increase
in interest rates; (k) any decreases in market rental rates; (l) the timing and
costs associated with property development, improvements and rentals; (m)
changes in taxation or zoning laws; (n) government regulations; (o) our failure
to continue to qualify as a real estate investment trust; (p) availability of
financing on acceptable terms or at all; (q) potential liability under
environmental or other laws or regulations; (r) general competitive factors;
(s) dependence upon Vornado Realty Trust (Vornado); and (t) possible
conflicts of interest with Vornado. For these forward-looking statements, the Company claims the protection of
the safe harbor for forward-looking statements contained in the Private
Securities Litigation Reform Act of 1995. You are cautioned not to place undue
reliance on the forward-looking statements, which speak only as of the date of
this Quarterly Report on Form 10-Q or the date of the applicable document
incorporated by reference. All subsequent written and oral forward-looking
statements attributable to the Company or any person acting on its behalf are
expressly qualified in their entirety by the cautionary statements contained or
referred to in this section. The Company undertakes no obligation to publicly
update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise. Overview Managements Discussion and Analysis of Financial Condition and Results of
Operations includes a discussion of the Companys consolidated financial
statements for the three months ended March 31, 2004 and 2003. The preparation
of financial statements in conformity with accounting principles generally
accepted in the United States of America requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting periods. Actual results could differ from those estimates. A summary of the Companys critical accounting policies is included in the
Companys Annual Report on Form 10-K for the year ended December 31, 2003 in
Item 7. Managements Discussion and Analysis of Financial Condition and
Results of Operations and Note 2  Summary of Significant Accounting
Policies to the consolidated financial statements included therein. There
have been no significant changes to those policies during the first quarter of
2004. Application of Critical Accounting Policies Real Estate As construction of the Lexington Avenue development project progresses and
as components of the building are placed into service (e.g., the space
delivered to Bloomberg L.P. and The Home Depot), the Company will cease
capitalizing property operating expenses and interest expense and begin to
expense these items, as well as depreciation, for those components. In the
three months ended March 31, 2004, the Company transferred approximately
$68,576,000 from Construction in progress to Land and Buildings,
leaseholds and leasehold improvements, representing the space delivered to The
Home Depot and the remainder of the space delivered to Bloomberg L.P. 13




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##### Table of Contents



Condominium Sales Income on deposits received for sales of condominium units at the
Lexington Avenue development property has been deferred in accordance with the
deposit method of Statement of Financial Accounting Standards No. 66,
Accounting for Sales of Real Estate. As of March 31, 2004, the Company has
received deposits of $22,774,000 on sales of the condominium units (included on
the Consolidated Balance Sheets as Escrow deposits and restricted cash). Stock Appreciation Rights Compensation
expense for each stock appreciation right (SARs) is measured by
the excess of the stock price at the current balance sheet date over the stock
price at the previous balance sheet date. If the stock price is lower at the
current balance sheet date, previously recognized expense is reversed but not
below zero. In the three months ended March 31, 2004, the Company recorded
$30,039,000 of SARs compensation expense as Alexanders, Inc. stock price
increased by $35.34 to $160.00 from December 31, 2003 to March 31, 2004. No
compensation expense was recorded in the three months ended March 31, 2003. Results of Operations The Company had a net loss of $22,992,000 for the quarter ended March 31,
2004, compared to net income of $4,804,000 in the prior years quarter. The
net loss for the current years period includes (i) an accrual of $30,039,000
for compensation expense for SARs and (ii) $3,050,000 resulting from the write
off of unamortized deferred debt expense in connection with the reduction of
the principal amount of the construction loan for the Lexington Avenue project
(the Construction Loan). Property rentals were $24,567,000 in the quarter ended March 31, 2004,
compared to $12,823,000 in the prior years quarter, an increase of
$11,744,000. The increase is primarily attributable to $11,334,000 of rent
recognized under the lease with Bloomberg L.P. Bloomberg L.P. took possession
of 87% of the 695,000 square feet under the lease on November 15, 2003. At
February 9, 2004, all of the space was delivered. On March 29, 2004, the
Company delivered 83,000 square feet of retail space at Lexington Avenue to The
Home Depot with respect to which the Company recorded $65,000 of revenue in the
current years quarter. Tenant expense reimbursements were $9,198,000 in the quarter ended March
31, 2004, compared to $6,900,000 in the prior years quarter, an increase of
$2,298,000. The increase is largely due to (i) reimbursements from Bloomberg
L.P. and (ii) a non-recurring billing adjustment of $568,000 for two tenants at
the Kings Plaza Regional Shopping Center. Operating expenses were $10,496,000 in the quarter ended March 31, 2004,
compared to $9,309,000 in the prior years quarter, an increase of $1,187,000.
Of this increase, $1,378,000 resulted from operating expenses at the Lexington
Avenue property which were reimbursed by Bloomberg L.P., partially offset by
$220,000 due to lower operating costs at the utility plant at the Companys
Kings Plaza Regional Shopping Center. General and administrative expenses were $31,205,000 in the quarter ended
March 31, 2004, compared to $926,000 in the prior years quarter, an increase
of $30,279,000. The increase resulted from an accrual of $30,039,000 of
compensation expense for 850,000 SARs based on the Companys closing stock
price of $160.00 at March 31, 2004 ($35.34 greater than the closing price of
$124.66 at December 31, 2003). There was no SARs compensation expense in the
prior years quarter. Depreciation and amortization expense was $3,530,000 in the quarter ended
March 31, 2004, compared to $1,607,000 in the prior years quarter, an increase
of $1,923,000. The increase was largely due to depreciation on the space
delivered to Bloomberg L.P. Interest and other income, net was $458,000 in the quarter ended March 31,
2004, compared to $123,000 in the prior years quarter, an increase of
$335,000. This increase resulted primarily from larger average cash balances
in the current years quarter. Interest and debt expense was $8,934,000 in the quarter ended March 31,
2004, compared to $3,200,000 in the prior years quarter, an increase of
$5,734,000. This increase resulted primarily from (i) lower amounts of
capitalized interest in the current years quarter as the Company began to
place portions of the Lexington Avenue 14




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##### Table of Contents



development property in service beginning in November 2003 (interest of
$6,729,000 was capitalized in 2004, as compared to $8,731,000 in 2003) and (ii)
an increase in average debt from approximately $549,000,000 to $818,000,000
(chiefly due to the $400,000,000 Lexington Avenue mortgage financing and the
Construction Loan), partially offset by (iii) a decline in the average interest
rate from approximately 7.98% to 7.00%. In connection with reducing the principal amount of the Construction Loan
on February 13, 2004, the Company wrote off $3,050,000, the proportionate share
of unamortized deferred debt expense, in the first quarter of 2004. Liquidity and Capital Resources In the aggregate, the Companys operating properties do not generate
sufficient cash flow to pay all of its expenses. After the completion of the
Lexington Avenue property, which is expected in 2005, the Company expects that
cash flow will become positive. Development Projects Lexington Avenue The development at Lexington Avenue consists of an approximately 1.3
million square foot multi-use building. The building will contain
approximately 885,000 net rentable square feet of office space, approximately
171,000 net rentable square feet of retail space and approximately 248,000 net
saleable square feet of residential space consisting of condominium units
(through a taxable REIT subsidiary). Of the construction budget of
$630,000,000 (which excludes $29,000,000 for development and guarantee fees to
Vornado), $434,500,000 has been expended through March 31, 2004 and an
additional $48,900,000 has been committed to at March 31, 2004. Construction
is expected to be completed in 2005. On November 15, 2003, the Company delivered approximately 87% of the
695,000 square feet of the office space leased to Bloomberg L.P. As of
February 9, 2004, all of the space has been delivered. Payment of base rent
commences nine months from delivery of each parcel of space; rent recognition
commenced from delivery. At March 31, 2004, 115,000 square feet of retail space has been leased, of
which The Home Depot and Hennes & Mauritz have leased 83,000 and 27,000 square
feet, respectively. On March 29, 2004, the Company delivered the 83,000 square
feet leased to The Home Depot. The Company expects to deliver the space leased
to Hennes & Mauritz during the second quarter of 2004. Payment of base rent
commences six to nine months from delivery of each space; rent recognition
commences on delivery of space. In the three months ended March 31, 2004, the
Company transferred approximately $68,576,000 from Construction in progress
to Land and Buildings, leaseholds and leasehold improvements, representing
the space delivered to The Home Depot and the remainder of the space delivered
to Bloomberg L.P. The residential space is comprised of 105 condominium units. The original
offering plan filed for these units, as amended for price increases through
March 31, 2004, would produce (reflecting the value of existing contracts and
the offering price for the remaining units) an aggregate sale price of
$507,000,000. As of March 31, 2004, the Company has received deposits of
$22,774,000 on sales of the condominium units. Financing of the Project On February 13, 2004, the Company completed a $400,000,000 mortgage
financing on the office space. The loan was placed by German American Capital
Corporation, an affiliate of Deutsche Bank. The loan bears interest at 5.33%,
matures in February 2014 and beginning in the third year, provides for
principal payments based on a 25-year amortization schedule such that over the
remaining eight years of the loan, ten years of amortization will be paid.
$253,529,000 of the loan proceeds was used to repay the entire amount
outstanding under the previously existing Construction Loan with Hypo Real
Estate Capital Corporation. The Construction Loan was modified so that the remaining availability is
$237,000,000, which was approximately the amount estimated to complete the
Lexington Avenue development project at the closing date (not including $29,000,000 for development
and guarantee fees to Vornado). The interest rate of the Construction Loan of
LIBOR plus 2.5% (3.60% at March 31, 2004) and the maturity date of January
2006, with two one-year extensions, were not changed. The collateral for the
Construction Loan is the same except that the office space has been removed
from the lien. Further, the Construction Loan permits the release of the
retail space for a payment of $15 million and requires all 15




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##### Table of Contents



proceeds from the sale of the residential condominium units to be applied
to the Construction Loan balance until it is finally repaid. Vornado has
agreed to guarantee to the construction lender, the lien free, timely
completion of the construction of the Lexington Avenue project and funding of
project costs in excess of a stated loan budget, if not funded by the Company
(the Completion Guarantee). If Vornado should advance any funds under the
Completion Guarantee in excess of $21,000,000, which is the amount available at
March 31, 2004 under the line of credit with Vornado, interest on those
advances would be at 15% per annum. Proceeds from the Mortgage Financing As noted above, $253,529,000 of the proceeds from the $400,000,000
mortgage financing on the Lexington Avenue office space was used to repay the
entire amount outstanding under the previously existing Construction Loan.
$12,559,000 of the proceeds was used to fund escrow accounts required under the
financing arrangement (reflected on the Consolidated Balance Sheets as Escrow
deposits and restricted cash) including a reserve of $11,170,000 at March 31,
2004, which will be used for interest payments until Bloomberg L.P. begins to
pay rent under its lease. The remaining proceeds, after $1,328,000 of
financing costs, were $132,584,000; the Company has subsequently used
approximately $32,000,000 of these proceeds to fund capital expenditures for
the Lexington Avenue development project in lieu of borrowings under the
Construction Loan. There can be no assurance that the Lexington Avenue project will be
completed on time or completed for the budgeted amount. Any failure to
complete the Lexington Avenue project on time or within budget may adversely
affect future cash flows and funds from operations, and the Companys financial
condition. Kings Plaza The Company plans to construct a two-story freestanding building adjacent
to the Kings Plaza Mall of approximately 200,000 square feet. The first story
of approximately 120,000 square feet will be operated as a Lowes Home
Improvement Warehouse (Lowes). The Lowes lease is expected to commence in
2006. The cost of the project will be approximately $13,000,000 to $15,000,000,
net of a reimbursement from Lowes and before reimbursement, if any, from the
second story tenant(s). There can be no assurance that this project will be
completed, completed on time or completed for the budgeted amount. Insurance On November 26, 2002, the Terrorism Risk Insurance Act of 2002 was signed
into law. Under this new legislation, through 2005, regulated insurers must offer coverage in their commercial
property and casualty policies (including existing policies) for losses
resulting from defined acts of terrorism. As a result of the legislation, in
June 2003, the Company obtained $500,000,000 of coverage per occurrence for
certified terrorist acts, as defined in the legislation, and $150,000,000 per
occurrence for non-certified acts. In addition, on February 13, 2004, the
Company increased the builders risk insurance coverage for its Lexington
Avenue project, which includes full coverage for certified terrorist acts, per
occurrence, and $200,000,000 for non-certified acts, per occurrence.
Therefore, the Company is at risk for financial loss in excess of these limits
for terrorist acts, as defined by the policies and the legislation. Such loss
could be material. The Companys debt instruments, consisting of mortgage loans secured by
its properties (which are generally non-recourse to the Company), contain
customary covenants requiring the Company to maintain insurance. There can be
no assurance that the lenders under these instruments will not take the
position that a future exclusion from all-risk insurance coverage for losses
due to terrorist acts is a breach of these debt instruments, allowing the
lenders to declare an event of default and accelerate repayment of debt. In
addition, if lenders insist on coverage for these risks and the Company is
unable to obtain coverage once the Terrorism Risk Insurance Act of 2002 has
lapsed, it may adversely affect the Companys ability to finance and/or
refinance its properties and businesses. Stock Appreciation Rights As of March 31, 2004, 850,000 SARs were outstanding and exercisable at a
weighted-average exercise price of $71.82. The agreements for these SARs
require that they be settled in cash. Had the holders of these SARs chosen to
exercise their rights as of March 31, 2004, the Company would have had to pay
$74,956,000 in cash. Any further appreciation in the Alexanders, Inc. stock price
from the closing stock price of $160.00 at March 31, 2004 will increase the
cash the Company would have to pay upon exercise and may impact liquidity by
requiring the Company to secure additional borrowings to replace such a cash
outflow. 16




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##### Table of Contents



Cash Flows Three Months Ended March 31, 2004 Net cash provided by operating activities of $3,406,000 was comprised of
(i) the net change in operating assets and liabilities of
$30,642,000, partially offset by
(ii) a net loss of $22,992,000 and (iii) non-cash items of
4,244,000. The adjustments for non-cash items are comprised of
(a) the effect of straight-lining of rental income of
$11,683,000, partially offset by (b)$4,389,000 of depreciation and
amortization and (c) $3,050,000 resulting from the write off of unamortized
deferred debt expense. Net cash used in investing activities of $62,072,000 was comprised of
capital expenditures of $50,612,000 and net cash restricted for operating
liabilities of $11,460,000. The capital expenditures primarily related to the
Lexington Avenue development project. Net cash provided by financing activities of $156,815,000 resulted
primarily from borrowings collateriallized by the Lexington Avenue development
project of $412,630,000, partially offset by debt repayments of $254,252,000
and debt issuance costs of $1,914,000. Three Months Ended March 31, 2003 Net cash provided by operating activities of $9,445,000 was comprised of
(i) net income of $4,804,000, (ii) non-cash items of $2,014,000, and (iii) the
net change in operating assets and liabilities of $2,627,000. The adjustments
for non-cash items include depreciation and amortization of $2,574,000,
partially offset by the effect of straight-lining of rental income of $560,000. Net cash used in investing activities of $64,434,000 was largely comprised
of capital expenditures of $61,574,000. The capital expenditures are primarily
related to the Lexington Avenue development project. Net cash provided by financing activities of $23,801,000 resulted from
borrowings of $24,518,000 mainly to fund expenditures for the Lexington Avenue
development project, partially offset by debt repayments of $717,000. Funds from Operations for the Three Months Ended March 31, 2004 and 2003 Funds from Operations (FFO) was a negative $19,462,000 in the quarter
ended March 31, 2004, compared to a positive $6,411,000 in the prior years
quarter, a decrease of $25,873,000. FFO for the three months ended March 31,
2004 includes (i) accrued compensation expense for SARs of $30,039,000 and (ii)
$3,050,000 resulting from the write off of unamortized deferred debt expense in
connection with the reduction of the principal amount of the Construction Loan
for the Lexington Avenue project. The following table reconciles net (loss)
income to FFO. Three Months EndedMarch 31,(amounts in thousands)
    
    2004
    
    2003Net (loss) income
    
    $
    (22,992
    )
    
    $
    4,804Depreciation and amortization of
real property
    
    
    3,530
    
    
    
    1,607Funds from operations
    
    $
    (19,462
    )
    
    $
    6,411
 FFO does not represent cash generated from operating activities in
accordance with accounting principles generally accepted in the United States
of America and is not necessarily indicative of cash available to fund cash
needs, which is disclosed in the consolidated statements of cash flows. There
are no material legal or functional restrictions on the use of FFO. FFO should
not be considered as an alternative to net (loss) income as an indicator of
the Companys operating performance. Management considers FFO a relevant
supplemental measure of operating performance because it provides a basis for
comparison among real estate investment trusts. FFO is computed in accordance
with the National Association of Real Estate Investment Trusts (NAREIT)
standards, which may not be comparable to FFO reported by other real estate
investment trusts that do not define the term in accordance with NAREITs
definition or that interpret NAREITs definition differently. 17




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Item 3. Quantitative and Qualitative Disclosures About Market Risk The following table summarizes the Companys exposure to a change in
interest rates. Weighted
    
    Effect of ChangeMarch 31, 2004
    
    Average Interest
    
    In Base Rates of(amounts in thousands except pershare amount)
    
    Balance
    
    Rate
    
    1%Variable rate
    
    $
    124,000
    
    
    
    12.48
    %
    
    $
    1,240Fixed rate
    
    
    765,863
    
    
    
    6.19
    %
    
    
    $
    889,863
    
    
    
    
    
    
    
    1,240Total effect on the Companys
annual net earnings per
share  diluted
    
    
    
    
    
    
    
    
    
    $
    0.25
 The fair value of the Companys debt, estimated by discounting future cash
flows using the current rates available to borrowers with similar credit
ratings for the remaining terms of such debt, exceeds the aggregate carrying
amount by approximately $1,038,000 at March 31, 2004. Such fair value
estimates are not necessarily indicative of the amounts that would be paid upon
liquidation of the Companys debt. 
 Item 4. Controls and Procedures (a) Disclosure Controls and Procedures- The Companys management, with
the participation of the Companys Chief Executive Officer and Chief Financial
Officer, has evaluated the effectiveness of the Companys disclosure controls
and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under
the Securities Exchange Act of 1934, as amended) as of the end of the period
covered by this Quarterly Report on Form 10-Q. Based on such evaluation, the
Companys Chief Executive Officer and Chief Financial Officer have concluded
that, as of the end of such period, the Companys disclosure controls and
procedures are effective. (b) Internal Control Over Financial Reporting There have not been any
changes in the Companys internal control over financial reporting during the
fiscal quarter to which this Quarterly Report on Form 10-Q relates that have
materially affected, or are reasonably likely to materially affect, the
Companys internal control over financial reporting. 18




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##### Table of Contents



PART II. OTHER INFORMATION 
 Item 1. Legal Proceedings Neither Alexanders, Inc. nor any of its subsidiaries is a party to, nor
is their property the subject of, any material pending legal proceeding other
than routine litigation incidental to their businesses. The Company believes
that these routine legal actions will not be material to the Companys
financial condition or results of operations. 
 Item 6. Exhibits and Reports on Form 8-K  (a)
    
    Exhibits required by Item 601 of Regulation S-K are filed herewith and are
listed in the attached Exhibit Index.(b)
    
    Reports on Form 8-K: During the quarter covered by this Quarterly Report on Form 10-Q
Alexanders, Inc. filed the following report on Form 8-K: Period Covered (Dateof Event Reported)
    
    Items Reported
    
    Date FiledFebruary 18, 2004
    
    Press release -
$400 million mortgage financing
on office space at Lexington
Avenue Development Project
    
    February 18, 2004
 19




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##### Table of Contents



SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized. ALEXANDERS, INC.
(Registrant)Date: May 6, 2004
    /s/ Joseph MacnowJoseph MacnowExecutive Vice President and Chief Financial Officer
(duly authorized officer and principal financial and
accounting officer) 20




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EXHIBIT INDEX ExhibitNo.3.1
    
    Amended and Restated Certificate of Incorporation.
Incorporated herein by reference from Exhibit 3.1 to the
registrants Registration Statement on Form S-3 filed on
September 20, 1995
    
    *3.2
    
    By-laws, as amended. Incorporated herein by reference
from Exhibit 10.1 to the registrants Quarterly Report on
Form 10-Q for the quarter ended March 31, 2000
    
    *15.1
    
    Letter regarding unaudited interim financial information31.1
    
    Rule 13a-14(a) certification of the Chief Executive
Officer31.2
    
    Rule 13a-14(a) certification of the Chief Financial
Officer32.1
    
    Section 1350 certification of the Chief Executive Officer32.2
    
    Section 1350 certification of the Chief Financial Officer
   * Incorporated by reference. 21