<PAGE>   1
                                                        EXHIBIT INDEX ON PAGE 15



                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q



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

For the quarterly period ended:                     JUNE 30, 1999

                                       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:   001-14525


                            VORNADO OPERATING COMPANY
             (Exact name of registrant as specified in its charter)


                   DELAWARE                                      22-3569068
   (State or other jurisdiction of incorporation            (I.R.S. Employer
               or organization)                           Identification Number)


PARK 80 WEST, PLAZA II, SADDLE BROOK, NEW JERSEY                   07663
     (Address of principal executive offices)                    (Zip Code)


                                 (201) 587-1000
              (Registrant's telephone number, including area code)

                                       N/A
              (Former name, former address and former fiscal year,
                          if changed since last report)

                 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


As of July 16, 1999 there were 4,068,310 shares of the registrant's common
stock, par value $.01 per share, outstanding.


                                     Page 1
<PAGE>   2
                                      INDEX

<TABLE>
<CAPTION>
PART I.                   FINANCIAL INFORMATION:                                                        Page Number
<S>            <C>        <C>                                                                           <C>

               Item 1.    Financial Statements:

                          Consolidated Balance Sheets as of  June 30, 1999 and
                          December 31, 1998.........................................................        3

                          Consolidated Statement of Operations for the Three and Six Months
                          Ended June 30, 1999.......................................................        4

                          Consolidated Statement of Cash Flows for the Six Months
                          Ended June 30, 1999.......................................................        5

                          Notes to Consolidated Financial Statements................................        6

               Item 2.    Management's Discussion and Analysis of Financial Condition
                          and Results of Operations.................................................       11

               Item 3.    Quantitative and Qualitative Disclosures About Market Risk................       12



PART II.                  OTHER INFORMATION:

               Item 1.    Legal Proceedings.........................................................       13

               Item 4.    Submission of Matters to a Vote of Security Holders.......................       13

               Item 6.    Exhibits and Reports on Form 8-K..........................................       13

Signatures                ..........................................................................       14

Exhibit Index             .........................................................................        15
</TABLE>


                                     Page 2
<PAGE>   3
PART I.  FINANCIAL INFORMATION
     ITEM 1. FINANCIAL STATEMENTS


                            VORNADO OPERATING COMPANY

                           CONSOLIDATED BALANCE SHEETS


<TABLE>
<CAPTION>

                                                                                                 JUNE 30, 1999     DECEMBER 31, 1998
                                                                                                ---------------    -----------------
ASSETS
<S>                                                                                             <C>                   <C>
Cash.......................................................................................     $     4,827,367       $  11,831,561
Investment in Cold Storage partnership.....................................................          21,676,021                  --
Investment in Charles E. Smith Commercial Realty L.P. .....................................                  --          12,920,000
Prepaid insurance..........................................................................             388,729             475,113
                                                                                                ---------------       -------------
                                                                                                $    26,892,117       $  25,226,674
                                                                                                ===============       =============

LIABILITIES AND STOCKHOLDERS' EQUITY

Note payable to Vornado Realty Trust.......................................................     $     4,586,896       $          --
Due to Vornado Realty Trust................................................................             159,692           1,066,451
Accrued expenses...........................................................................             585,120             127,015
                                                                                                ---------------       -------------
Total liabilities..........................................................................           5,331,708           1,193,466
                                                                                                ---------------       -------------
 Minority interest..........................................................................          2,136,171           2,379,285
                                                                                                ---------------       -------------

Commitments and contingencies

Stockholders' equity:
     Common stock: par value $.01 per share; authorized, 40,000,000 shares; issued and
     outstanding, 4,068,310 shares.........................................................              40,683              40,683
Additional paid-in capital.................................................................          22,480,660          22,497,760
Deficit....................................................................................          (3,097,105)           (884,520)
                                                                                                ---------------       -------------
     Total stockholders' equity............................................................          19,424,238          21,653,923
                                                                                                ---------------       -------------
                                                                                                $    26,892,117       $  25,226,674
                                                                                                ===============       =============
</TABLE>


                 See notes to consolidated financial statements.

                                     Page 3
<PAGE>   4
                            VORNADO OPERATING COMPANY

                      CONSOLIDATED STATEMENT OF OPERATIONS





<TABLE>
<CAPTION>
                                                                FOR THE THREE            FOR THE SIX
                                                                MONTHS ENDED             MONTHS ENDED
                                                                JUNE 30, 1999           JUNE 30, 1999
                                                                --------------        -----------------
<S>                                                             <C>                   <C>
Revenues:
     Interest income.................................           $      145,748          $      324,552
                                                                --------------          --------------

Expenses:
     General and administrative......................                  284,163                 473,896
     Organization costs..............................                  265,084                 359,643
                                                                --------------          --------------
Total expenses.......................................                  549,247                 833,539
                                                                --------------          --------------
                                                                      (403,499)               (508,987)
Loss from investment in Cold Storage partnership.....               (1,517,800)             (1,592,400)
Interest and debt expense to Vornado Realty Trust....                 (370,807)               (634,312)
Gain on sale of investment in Charles E. Smith
  Commercial Realty L.P..............................                       --                 280,000
                                                                --------------          --------------
Loss before income tax benefit and
     minority interest...............................               (2,292,106)             (2,455,699)

Income tax benefit...................................                       --                      --
                                                                --------------          --------------

Loss before minority interest........................               (2,292,106)             (2,455,699)

Minority interest....................................                  226,918                 243,114
                                                                --------------          --------------

Net loss.............................................           $   (2,065,188)         $   (2,212,585)
                                                                ==============          ==============

Net loss per share -- basic and diluted..............           $         (.51)         $         (.54)
                                                                ==============          ==============
</TABLE>


                See notes to consolidated financial statements.

                                     Page 4
<PAGE>   5
                            VORNADO OPERATING COMPANY

                      CONSOLIDATED STATEMENT OF CASH FLOWS



<TABLE>
<CAPTION>
                                                                                                 FOR THE SIX
                                                                                                MONTHS ENDED
                                                                                                JUNE 30, 1999
                                                                                                -------------
<S>                                                                                             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net loss.........................................................................          $  (2,212,585)
     Adjustments to reconcile net loss to net cash used in
         operations:
         Minority interest............................................................               (243,114)
         Loss from investment in Cold Storage partnership.............................              1,592,400
         Non-cash compensation........................................................                 97,298
         Gain on sale of investment in Charles E. Smith
           Commercial Realty L.P. ....................................................               (280,000)
     Changes in operating assets and liabilities:
         Prepaid insurance............................................................                 86,384
         Accrued expenses.............................................................                360,807
         Due to Vornado Realty Trust..................................................               (906,759)
                                                                                                -------------
Net cash used in operating activities.................................................             (1,505,569)
                                                                                                -------------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Investment in Cold Storage partnership...........................................            (23,268,421)
     Proceeds from sale of investment in Charles E. Smith
       Commercial Realty L.P. ........................................................             13,200,000
                                                                                                -------------
Net cash used in investing activities.................................................            (10,068,421)
                                                                                                -------------

CASH FLOWS FROM FINANCING ACTIVITIES:
     Proceeds from borrowings.........................................................             18,586,896
     Repayments on borrowings.........................................................            (14,000,000)
     Other............................................................................                (17,100)
                                                                                                -------------
Net cash provided by financing activities.............................................              4,569,796
                                                                                                -------------

Net decrease in cash and cash equivalents.............................................             (7,004,194)
Cash and cash equivalents at beginning of period......................................             11,831,561
                                                                                                -------------
Cash and cash equivalents at end of period............................................          $   4,827,367
                                                                                                =============

NON-CASH TRANSACTIONS:
     Non-cash compensation............................................................          $      97,298
                                                                                                =============
</TABLE>


                See notes to consolidated financial statements.

                                     Page 5
<PAGE>   6
                            VORNADO OPERATING COMPANY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.    ORGANIZATION

      On October 16, 1998, Vornado Realty L.P. (the "Operating Partnership"), a
subsidiary of Vornado Realty Trust ("Vornado"), made a distribution (the
"Distribution") of one share of common stock, par value $.01 per share ("Common
Stock"), of Vornado Operating Company (the "Company") for 20 units of limited
partnership interest of the Operating Partnership (including the units owned by
Vornado) held of record as of the close of business on October 9, 1998 (the
"Record Date"), and Vornado in turn made a distribution of the Common Stock it
received to the holders of its common shares of beneficial interest, par value
$.04 per share ("Vornado Common Shares"). While no Common Stock was distributed
in respect of Vornado's $3.25 Series A Convertible Preferred Shares, Vornado
adjusted the conversion price to take into account the Distribution.

      The Company holds its assets and conducts its business through Vornado
Operating L.P., a Delaware limited partnership ("Company L.P."). The Company is
the sole general partner of, and as of June 30, 1999 owned a 90.1% partnership
interest in, Company L.P. All references to the "Company" refer to Vornado
Operating Company and its subsidiaries, including Company L.P.

2.    BASIS OF PRESENTATION

      The consolidated balance sheet as of June 30, 1999, the consolidated
statement of operations for the three and six months ended June 30, 1999 and the
consolidated statement of changes in cash flows for the six months ended June
30, 1999 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 changes in cash flows have been
made. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. These condensed consolidated
financial statements should be read in conjunction with the consolidated
financial statements and notes thereto included in the Company's Form 10-K for
the year ended December 31, 1998 as filed with the Securities and Exchange
Commission. The results of operations for the three and six months ended June
30, 1999 are not necessarily indicative of the operating results for the full
year.

      The accompanying consolidated financial statements include the accounts of
the Company and Company L.P. All significant intercompany amounts have been
eliminated.

      Management has made estimates and assumptions that affect the reported
amounts of 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.

3.    ACQUISITIONS AND DISPOSITION

Cold Storage Companies

      In March 1999, the Company and Crescent Operating Inc. ("Crescent
Operating") formed a new partnership (the "Partnership") that purchased all of
the non-real estate assets of the cold storage companies which do business under
the name of AmeriCold Logistics encompassing the operations of the cold storage
business for approximately $48 million from partnerships in which Vornado has a
60% interest and Crescent Real Estate Equities Company has a 40% interest
("Vornado/Crescent Partnership"). The new partnership leases 88 cold storage
warehouses used in the cold storage business from the Vornado/Crescent
Partnership, which continues to own the real estate. The leases have a 15-year
term with two five-year renewal options and provide for the payment of fixed
base rent and percentage rent based on customer revenues. The new partnership is
required to pay for all costs arising from the operation, maintenance and repair
of the properties, as well as property capital expenditures in excess of
$5,000,000 annually. Fixed base rent and percentage rent for the initial lease
year is projected to be approximately $151,000,000. The new partnership has the
right to defer a portion of the rent for up to three years beginning in


                                     Page 6
<PAGE>   7
                            VORNADO OPERATING COMPANY

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)


March 1999 to the extent that available cash, as defined in the leases, is
insufficient to pay such rent. In addition to the leased warehouses, AmeriCold
Logistics manages 13 additional warehouses.

      The Company owns 60% of the partnership through Company L.P. and Crescent
Operating indirectly owns 40% of the Partnership. The Company accounts for this
investment under the equity method of accounting as Crescent Operating has
"substantive participating rights" as defined in accounting literature.

      To fund its share of the purchase price, the Company utilized $4.6 million
of cash and borrowed $18.6 million under its revolving credit facility with
Vornado. Further, the Company's share of the obligation to close the warehousing
operation of one of the leased facilities is approximately $6 million.

Charles E. Smith Commercial Realty L.P. ("CESCR")

      In December 1998, the Company purchased approximately 1.7% of the
outstanding partnership units of CESCR for an aggregate price of approximately
$12.9 million, or $34 per unit, from Vornado. No distributions were received by
the Company on this investment in 1999. In connection with this purchase, the
Company was granted an option to require Vornado to repurchase all of the CESCR
units at the price at which the Company purchased the CESCR units from Vornado,
plus a cumulative return on such amount at a rate of 10% per annum. In March
1999, the Company exercised its option and Vornado acquired the CESCR units from
the Company for $13.2 million.

      PRO FORMA INFORMATION

      The pro forma condensed consolidated operating results for the Company for
the six months ended June 30, 1999 are presented as if the acquisitions and
dispositions described above and the financing attributable thereto had occurred
on January 1, 1999.

      Condensed Consolidated Pro Forma Operating Results

<TABLE>
<CAPTION>
                                                                Pro Forma
                                                             Six Months Ended
                                                               June 30, 1999
                                                             ----------------
<S>                                                          <C>
Revenues...............................................      $       324,552
Expenses...............................................             (833,539)
                                                             ---------------
                                                                    (508,987)
Loss from investment in Cold Storage partnership.......           (2,104,943)
Interest and debt expense..............................             (884,042)
Gain on sale of investment in Charles E. Smith
    Commercial Realty L.P..............................              280,000
Minority interest......................................              318,579
                                                             ---------------

Net loss...............................................      $    (2,899,393)
                                                             ===============

Net loss per share - basic and diluted.................      $          (.71)
                                                             ===============
</TABLE>

      See "Management's Discussion and Analysis of Financial Condition and
Results of Operations - Liquidity and Capital Resources" for the cash effect of
the above loss.


                                     Page 7
<PAGE>   8
                            VORNADO OPERATING COMPANY

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)


4.    INVESTMENTS IN PARTNERSHIPS

      The Company's investments in partnerships and loss recognized from such
investments are as follows:


<TABLE>
<CAPTION>
                                                  Investments in Partnerships
                                             -----------------------------------
                                             June 30, 1999     December 31, 1998
                                             -------------     ----------------
<S>                                          <C>               <C>
Cold Storage Companies (60% interest)......  $  21,676,021     $             --
Charles E. Smith Commercial Realty L.P. ...             --           12,920,000
                                             -------------     ----------------
                                             $  21,676,021     $     12,920,000
                                             =============     ================
</TABLE>

<TABLE>
<CAPTION>
                                           Loss from Investments in Partnerships
                                           -------------------------------------
                                           Three Months Ended   Six Months Ended
                                             June 30, 1999       June 30, 1999
                                           ----------------     ---------------
<S>                                        <C>                  <C>
Cold Storage Companies (60% interest)....  $     (1,517,800)    $    (1,592,400)
Charles E. Smith Commercial Realty L.P. .                --                  --
                                           ----------------     ---------------
                                           $     (1,517,800)    $    (1,592,400)
                                           ================     ===============
</TABLE>

      The following condensed data presents the income statements of the
Partnership (100%):

<TABLE>
<CAPTION>
                                                                For the Period
                                                                March 12, 1999
                                                              (Acquisition Date)
                                                                      to
                                                                 June 30, 1999
                                                               ----------------
<S>                                                            <C>
Revenues...............................................        $    203,074,000
Expenses...............................................            (206,690,000)
                                                               ----------------
Operating loss.........................................              (3,616,000)
Other income...........................................                 909,000
Gain on asset disposal.................................                  53,000
                                                               ----------------
Loss before income taxes...............................              (2,654,000)
Income taxes...........................................                      --
                                                               ----------------
Net loss...............................................        $     (2,654,000)
                                                               ================
</TABLE>


                                     Page 8
<PAGE>   9
                            VORNADO OPERATING COMPANY

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)


5.    INCOME TAXES

      Deferred income taxes reflect the tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes, specifically the
write-off of organization costs in 1999 and 1998 for financial reporting
purposes and the amortization of organization costs over 60 months for tax
reporting purposes. The tax effects of significant items comprising the
Company's net deferred tax asset as of June 30, 1999 and December 31, 1998 are
as follows:

<TABLE>
<CAPTION>
                                           June 30, 1999      December 31, 1998
                                           -------------      -----------------
<S>                                        <C>                <C>
Deferred assets:
   Organization costs..................    $    468,000          $    372,600
   Accrued compensation................          56,000                16,800
   Net operating loss carryforward.....         800,900                 3,300
                                           ------------          ------------
                                              1,324,900               392,700
Valuation allowance....................      (1,324,900)             (392,700)
                                           ------------          ------------
Net deferred tax asset.................    $         --          $         --
                                           ============          ============
</TABLE>

      Because the Company has only a limited operating history, a valuation
allowance has been established for its deferred tax assets.

      A reconciliation of income taxes to the expected income tax benefit is as
follows:

<TABLE>
<CAPTION>
                                                                  For The Six
                                                                  Months Ended
                                                                 June 30, 1999
                                                                 -------------
<S>                                                              <C>
Loss before income taxes and minority interest.........           $ 2,455,700
Expected state income tax benefit......................              (147,300)
                                                                  -----------
                                                                    2,308,400
Statutory federal income tax rate......................                    34%
                                                                  -----------
                                                                      784,900
Expected state income tax benefit......................               147,300
                                                                  -----------
                                                                      932,200
Change in valuation allowance..........................              (932,200)
                                                                  -----------
Income taxes...........................................           $        --
                                                                  ===========
</TABLE>

6.    INTERCOMPANY AGREEMENT

      The Company and Vornado have entered into an Intercompany Agreement
("Intercompany Agreement") pursuant to which, among other things, (a) Vornado
will under certain circumstances offer the Company an opportunity to become the
lessee of certain real property owned now or in the future by Vornado (under
mutually satisfactory lease terms) and (b) the Company will not make any real
estate investment or other REIT-Qualified Investment unless it first offers
Vornado the opportunity to make such investment and Vornado has rejected that
opportunity.

      Under the Intercompany Agreement, Vornado provides the Company with
certain administrative, corporate, accounting, financial, insurance, legal, tax,
data processing, human resources and operational services as well as space for
the Company's principal corporate office. The Company incurred approximately
$46,000 and $80,000 for the three and six months ended June 30, 1999 for such
services and rent.

      Vornado and the Company each have the right to terminate the Intercompany
Agreement if the other party is in material default of the Intercompany
Agreement or upon 90 days written notice to the other party at any time after
December 31, 2003. In addition, Vornado has the right to terminate the
Intercompany Agreement upon a change in control of the Company.


                                     Page 9
<PAGE>   10
                            VORNADO OPERATING COMPANY

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)


7.    LOSS PER SHARE

      The following table sets forth the computation of basic and diluted loss
per share for the three and six months ended June 30, 1999:

<TABLE>
<CAPTION>
                                                                             Three Months Ended      Six Months Ended
                                                                               June 30, 1999           June 30, 1999
<S>                                                                          <C>                     <C>
Numerator:
     Net loss........................................................          $ (2,065,188)           $ (2,212,585)
                                                                               ============            ============

Denominator:
     Denominator for basic loss per share-weighted average shares                 4,068,310               4,068,310

     Effect of dilutive securities:
         Employee stock options......................................                    --                      --
                                                                               ------------            ------------
         Denominator for diluted loss per share-adjusted
           weighted average..........................................             4,068,310               4,068,310
                                                                               ============            ============

Net loss per share-basic and diluted.................................          $       (.51)           $       (.54)
                                                                               ============            ============
</TABLE>


                                    Page 10
<PAGE>   11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS


RESULTS OF OPERATIONS

      The Company had a net loss of $2,065,188 for the three months ended June
30, 1999 and $2,212,585 for the six months ended June 30, 1999. Revenues of
$145,748 and $324,552 for the three and six months ended June 30, 1999 consisted
solely of interest income. Expenses were comprised of (i) general and
administrative expenses of $284,163 and $473,896 for the three and six months
ended June 30, 1999, including reimbursements paid to Vornado for certain
administrative and other services provided to the Company, directors fees,
insurance and legal and accounting fees and (ii) additional organization costs
of $265,084 and $359,643 for the three and six months ended June 30, 1999. Loss
from investment in partnership was comprised of equity in the loss from the Cold
Storage Companies of $1,517,800 for the three months ended June 30, 1999 and
$1,592,400 for the period March 12, 1999 (acquisition date) to June 30, 1999.
Interest and debt expense of $370,807 and $634,312 for the three and six months
ended June 30, 1999 is comprised of interest on the outstanding balance on the
Company's revolving credit facility and the fee on the unused portion of the
facility. Gain on sale of investment in partnership of $280,000 is the
cumulative return earned by the Company when it exercised its option to require
Vornado to repurchase its investment in Charles E. Smith Commercial Realty L.P.

LIQUIDITY AND CAPITAL RESOURCES

      On March 12, 1999, the Company and Crescent Operating Inc. ("Crescent
Operating") formed a new partnership that has purchased all of the non-real
estate assets of AmeriCold Logistics encompassing the operations of the cold
storage business for approximately $48 million from the Vornado/Crescent
Partnership. The new partnership leases 88 cold storage warehouses used in this
business from the Vornado/Crescent Partnership, which continues to own the real
estate. In addition to the leased warehouses, AmeriCold Logistics manages 13
additional warehouses.

      To fund its share of the purchase price, the Company utilized $4.6 million
of cash and borrowed $18.6 million under its revolving credit facility with
Vornado (see financing activities below). Further, the Company's share of the
obligation to close the ware-housing operation of one of the leased facilities
is approximately $6 million.

      The Company's pro forma net loss of $2,766,225 for the six months ended
June 30, 1999 includes $2,647,024 of non-cash expenses and $619,643 of
non-recurring expense. Non-cash expenses include (i) depreciation of $1,936,800
and (ii) the effect of straight-lining of rent expense of $1,014,171, offset by
minority interest of $303,947.

Six Months Ended June 30, 1999

      Cash flows used in operating activities of $1,505,569 was comprised of (i)
net loss of $2,212,585 and (ii) the net change in operating assets and
liabilities of $459,568, off-set by adjustments for non-cash and non-operating
items of $1,166,584. The adjustments for non-cash and non-operating items are
comprised of (i) loss from investment in Cold Storage partnership of $1,592,400,
(ii) non-cash compensation of $97,298, offset by (i) minority interest of
$243,114 and (ii) gain on sale of investment in Charles E. Smith Commercial
Realty L.P. of $280,000.

      Net cash used in investing activities of $10,068,421 was comprised of
investment in Cold Storage partnership of $23,268,421, offset by proceeds from
the sale of investment in Charles E. Smith Commercial Realty L.P. of
$13,200,000.

      Net cash provided by financing activities of $4,569,796 was comprised
primarily of proceeds from borrowings of $18,586,896, offset by repayments of
borrowings under its revolving credit facility with Vornado Realty Trust of
$14,000,000.


                                    Page 11
<PAGE>   12
Year 2000 Readiness Disclosure

      The Company is managed by Vornado. Vornado has advised the Company that
Vornado initiated its Year 2000 compliance programs and information systems
modifications in early 1998 to ensure that its systems and key processes will
remain functional. Vornado expects this objective to be achieved either by
modifying present systems using existing internal and external programming
resources or by installing new systems, and by monitoring supplier and other
third-party interfaces. In certain cases, Vornado will be relying on statements
from outside vendors as to the Year 2000 readiness of its systems.

      The Company is not aware of any operational systems within its control
that are not Year 2000 compliant. In the event that a third-party service is
interrupted due to a Year 2000 issue, the Company will seek to obtain such
service from another third-party provider.

Recently Issued Accounting Standards

      In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133, "Accounting for Derivative Instruments
and Hedging Activities". This statement establishes accounting and reporting
standards for derivative instruments, including certain derivative instruments
embedded in other contracts, and for hedging activities. It is effective for all
fiscal quarters of fiscal years beginning after June 15, 2000. Because the
Company does not currently utilize derivatives or engage in significant hedging
activities, management does not anticipate that implementation of this statement
will have a material effect on the Company's financial statements.

      In April 1998, the American Institute of Certified Public Accountants
issued Statement of Position 98-5, "Reporting on the Costs of Start-up
Activities" which is effective beginning in the first quarter of 1999. Costs
incurred in connection with the organization of the Company were expensed in
December 1998 and continue to be expensed as incurred.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

      At June 30, 1999, the Company had $4,586,896 of variable rate debt bearing
interest at an interest rate of 8.06% (LIBOR plus 3.00%). A one-percent increase
in the base used to determine the interest rate of the variable rate debt would
result in a $45,869 increase in the Company's annual net loss ($0.01 per diluted
share).


                                    Page 12
<PAGE>   13
PART II.   OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

      There are no pending legal proceedings to which the Company is a party or
to which any of its properties are subject.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

      On June 2, 1999, the Company held its annual meeting of stockholders. The
stockholders voted, in person or by proxy for the election of two nominees to
serve on the Board of Directors for a term of three years or until their
respective successors are duly elected and qualify. The two nominees were
elected. The results of the voting are shown below:

<TABLE>
<CAPTION>
                                                                    Votes Cast
                                                                    Against or
Director                              Votes Cast For                 Withheld
--------                              --------------                ----------
<S>                                   <C>                           <C>
Douglas H. Dittrick                       3,287,215                    720
Richard West                              3,287,215                    720
</TABLE>

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 ended June 30, 1999, Vornado Operating Company filed
the report on Form 8-K/A described below:

<TABLE>
<CAPTION>
 Date of Report
(Date of Earliest
 Event Reported)                 Item Reported                                          Date Filed
<S>                  <C>                                                                <C>
 March 12, 1999      Financial statements and pro forma in connection                   May 26, 1999
                     with the completed acquisition of AmeriCold Logistics
</TABLE>


                                    Page 13
<PAGE>   14
                                   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.


                                    VORNADO OPERATING COMPANY
                             --------------------------------------------------
                                        (Registrant)




Date:  August 5, 1999    By:           /s/  Irwin Goldberg
                             --------------------------------------------------
                                       IRWIN GOLDBERG
                                  Vice President, Chief Financial Officer


                                    Page 14
<PAGE>   15
                                  EXHIBIT INDEX


EXHIBIT NO.                                                                 PAGE
-----------                                                                 ----
            The following is a list of all exhibits filed as part
            of this report

2.1         Assignment Agreement, dated as of December 31, 1998, between      *
            Vornado Realty Trust, as assignor, and Vornado Operating
            Company, assignee (incorporated by reference to Exhibit 2.1 of
            the Company's Current Report on Form 8-K, dated December 31,
            1998 (File No. 001-14525), as filed with the Commission on
            January 15, 1999)

2.2         Put Agreement, dated as of December 31, 1998, between Vornado     *
            Realty Trust, as grantor, and Vornado Operating Company, as
            grantee (incorporated by reference to Exhibit 2.2 of the
            Company's Current Report on Form 8-K, dated December 31, 1998
            (File No. 001 -14525), as filed with the Commission on January
            15, 1999)

2.3         Asset Purchase Agreement dated as of February 26, 1999,           *
            between AmeriCold Logistics, LLC, as Purchaser, and AmeriCold
            Corporation, as Seller (incorporated by reference to Exhibit
            2.1 of the, Company's Current Report on Form 8-K, dated March
            12, 1999 (File No. 001-14525), as filed with the Commission on
            March 31, 1999)

2.4         Asset Purchase Agreement, dated as of March 9, 1999, between      *
            Vornado Crescent Logistics Operating Partnership, as
            Purchaser, and URS Logistics, Inc., as Seller (incorporated by
            reference to Exhibit 2.2 of the Company's Current Report on
            form 8-K, dated March 12, 1999 (File No. 001-14525), as filed
            with the Commission on March 31, 1999)

2.5         Asset Purchase Agreement, dated as of March 9, 1999, between      *
            AmeriCold Logistics, LLC, as Purchaser, and VC Omaha Holdings,
            L.L.C., as Seller (incorporated by reference to Exhibit 2.3 of
            the Company's Current Report on Form 8-K, dated March 12, 1999
            (File No. 001-14525), as filed with the Commission on March
            31, 1999)

2.6         Asset Purchase Agreement, dated as of March 9, 1999, between      *
            AmeriCold Logistics II, LLC, as Purchaser, and VC Missouri
            Holdings, L.L.C., as Seller (incorporated by reference to
            Exhibit 2.4 of the Company's Current Report on Form 8-K, dated
            March 12, 1999 (File No. 001-14525), as filed with the
            Commission on March 31, 1999)

3.1         Restated Certificate of Incorporation of Vornado Operating        *
            Company (incorporated by reference to Exhibit 3.1 of the
            Company's Registration Statement on Form S-11 (File No.
            333-40701), as filed with the Commission on September 28,
            1998)

3.2         Bylaws of Vornado Operating Company (incorporated by reference    *
            to Exhibit 3.2 of the Company's Registration Statement on Form
            S-11 (File No. 333-40701), as filed with the Commission on
            October 13, 1998)

----------------------
* Incorporated by reference.

                                    Page 15
<PAGE>   16
\
EXHIBIT NO.                                                                 PAGE
-----------                                                                 ----
4.1         Specimen stock certificate (incorporated by reference to          *
            Exhibit 4.1 of the Company's Registration Statement on Form
            S-11 (File No. 333-40701), as filed with the Commission on
            January 23, 1998)

10.1        Intercompany Agreement, dated as of October 16, 1998, between     *
            Vornado Operating Company and Vornado Realty Trust
            (incorporated by reference to Exhibit 10.1 of the Company's
            Annual Report on Form 10-K for the year ended December 31,
            1998 (File No. 001-14525))

10.2        Credit Agreement dated as of January 1, 1999, between Vornado     *
            Operating Company and Vornado Realty L.P., together with
            related form of Line of Credit Note (incorporated by reference
            to Exhibit 10.2 of the Company's Annual Report on Form 10-K
            for the year ended December 31, 1998 (File No. 001-14525))

10.3        1999 Omnibus Stock Plan of Vornado Operating Company              *
            (incorporated by reference to Exhibit 10.3 of the Company's
            Annual Report on Form 10-K for the year ended December 31,
            1998 (File No. 001-14525))

10.4        Agreement of Limited Partnership of Vornado Operating L.P.        *
            (incorporated by reference to Exhibit 10.4 of the Company's
            Annual Report on Form 10-K for the year ended December 31,
            1998 (File No. 001-14525))

10.5        Agreement, dated March 11, 1999, between Vornado Operating        *
            L.P. and COPI Cold Storage L.L.C. (incorporated by reference
            to Exhibit 10.1 of the Company's Current Report on Form 8-K,
            dated March 12, 1999 (File No. 001-14525), as filed with the
            Commission on March 31, 1999)

10.6        Master Lease Agreement, dated as of April 22, 1998, between       *
            URS Real Estate, L.P., as Landlord, and URS Logistics, Inc.,
            as Tenant (incorporated by reference to Exhibit 10.2 of the
            Company's Current Report on Form 8-K/A, dated March 12, 1999
            (File No. 001-14525), as filed with the Commission on May 26,
            1999).

10.7        First Amendment to Master Lease Agreement, dated as of March      *
            10, 1999, between URS Real Estate, L.P. and URS Logistics,
            Inc. (incorporated by reference to Exhibit 10.3 of the
            Company's Current Report on Form 8-K/A, dated March 12, 1999
            (File No. 001-14525), as filed with the Commission on May 26,
            1999).

10.8        Assignment and Assumption of Master Lease, dated as of March      *
            11, 1999, between URS Logistics, Inc. and AmeriCold Logistics
            II, LLC (incorporated by reference to Exhibit 10.4 of the
            Company's Current Report on Form 8-K/A, dated March 12, 1999
            (File No. 001-14525), as filed with the Commission on May 26,
            1999).

10.9        Master Lease Agreement, dated as of April 22, 1998, between       *
            AmeriCold Real Estate, L.P., as Landlord and AmeriCold
            Corporation, as Tenant (incorporated by reference to Exhibit
            10.5 of the Company's Current Report on Form 8-K/A, dated
            March 12, 1999 (File No. 001-14525), as filed with the
            Commission on May 26, 1999).

----------------------
* Incorporated by reference.

                                    Page 16
<PAGE>   17
EXHIBIT NO.                                                                 PAGE
-----------                                                                 ----
10.10       First Amendment to Master Lease Agreement, dated as of March      *
            10, 1999, between AmeriCold Real Estate, L.P. and AmeriCold
            Logistics, LLC (incorporated by reference to Exhibit 10.6 of
            the Company's Current Report on Form 8-K/A, dated March 12,
            1999 (File No. 001-14525), as filed with the Commission on May
            26, 1999).

10.11       Assignment and Assumption of Master Lease, dated as of            *
            February 28, 1999, between AmeriCold Corporation and AmeriCold
            Logistics, LLC (incorporated by referenced to Exhibit 10.7 of
            the Company's Current Report on Form 8-K/A, dated March 12,
            1999 (File No. 001-14525), as filed with the Commission on May
            26, 1999).

10.12       Master Lease Agreement, dated as of March 11, 1999, between       *
            URS Logistics, Inc., as landlord, and AmeriCold Logistics II,
            LLC, as Tenant (incorporated by reference to Exhibit 10.8 of
            the Company's Current Report on Form 8-K/A, dated March 12,
            1999 (File No. 001-14525), as filed with the Commission on May
            26, 1999).

10.13       Master Lease Agreement, dated as of February 28, 1999, between    *
            AmeriCold Corporation, as Landlord, and AmeriCold Logistics,
            LLC, as Tenant (incorporated by reference to Exhibit 10.9 of
            the Company's Current Report on Form 8-K/A, dated March 12,
            1999 (File No. 001-14525), as filed with the Commission on May
            26, 1999).

10.14       Master Lease Agreement, dated as of March 11, 1999, between       *
            each of the entities listed on Exhibit A thereto, collectively
            as Landlord, and AmeriCold Logistics, LLC, as Tenant
            (incorporated by reference to Exhibit 10.10 of the Company's
            Current Report on Form 8-K/A, dated March 12, 1999 (File No.
            001-14525), as filed with the Commission on May 26, 1999).

10.15       Master Lease Agreement, dated as of March 11, 1999, between VC    *
            Omaha Holdings, L.L.C. and Carmar Freezers Thomasville L.L.C.,
            together as Landlord, and AmeriCold Logisitics, LLC, as Tenant
            (incorporated by reference to Exhibit 10.11 of the Company's
            Current Report on Form 8-K/A, dated March 12, 1999 (File No.
            001-14525), as filed with the Commission on May 26, 1999).

27          Financial Data Schedule                                           18

----------------------
* Incorporated by reference.

                                    Page 17