UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________________________________

FORM 10-Q

___________________________________________



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

For the quarterly period ended September 30, 2015



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

For the transition period from to

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

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

___________________________________________

SL GREEN REALTY CORP.

SL GREEN OPERATING PARTNERSHIP, L.P.

(Exact name of registrant as specified in its charter)

___________________________________________



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

420 Lexington Avenue, New York, New York 10170

(Address of principal executive offices) (Zip Code)

(212) 594-2700

(Registrant’s telephone number, including area code)

___________________________________________

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

SL Green Realty Corp. YES x NO o SL Green Operating Partnership, L.P. YES x NO o

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

SL Green Realty Corp. YES x NO o SL Green Operating Partnership, L.P. YES x NO o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

SL Green Realty Corp.

Large accelerated filer x Accelerated filer o Non-accelerated filer o Smaller Reporting Company o (Do not check if asmaller reporting company) ~~Smaller Reporting Company o~~

SL Green Operating Partnership, L.P.

Large accelerated filer o Accelerated filer o Non-accelerated filer x Smaller Reporting Company o (Do not check if asmaller reporting company) ~~Smaller Reporting Company o~~

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

SL Green Realty Corp. YES o NO x SL Green Operating Partnership, L.P. YES o NO x

The number of shares outstanding of SL Green Realty Corp.'s common stock, $0.01 par value, was 9299,~~260~~703,~~239~~055 as of ~~October 31~~November 2, ~~2013~~2015. As of ~~October~~November 312, ~~2013~~2015, ~~879~~1,~~183~~005,301 common units of limited partnership interest of SL Green Operating Partnership, L.P. were held by non-affiliates. There is no established trading market for such units.

EXPLANATORY NOTE

This report combines the quarterly reports on Form 10-Q for the period ended September 30, ~~2013~~2015 of SL Green Realty Corp. and SL Green Operating Partnership, L.P. Unless stated otherwise or the context otherwise requires, references to "SL Green Realty Corp.," the "Company" or "SL Green" mean SL Green Realty Corp. and its consolidated subsidiaries; and references to "SL Green Operating Partnership, L.P.," the "Operating Partnership" or "SLGOP" mean SL Green Operating Partnership, L.P. and its consolidated subsidiaries. The terms "we,'" "our" and "us" mean the Company and all the entities owned or controlled by the Company, including the Operating Partnership.

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

The Company owns 9796.0626% of the outstanding general and limited partnership interest in the Operating Partnership. The Company also owns 9,200,000 Series I Preferred ~~units~~Units inof the Operating Partnership. As of September 30, ~~2013~~2015, noncontrolling investors held, in aggregate, a 23.9474% limited partnership interest in the Operating Partnership. We refer to these interests as the noncontrolling interests in the Operating Partnership.

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

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

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


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


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


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

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


•	consolidated financial statements;


•	the following notes to the consolidated financial statements:

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


◦	Note 12, Stockholders' Equity of the Company;


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

◦ Note 15, Accumulated Other Comprehensive Loss of the Company; ~~and~~


◦	Note 16, Accumulated Other Comprehensive Loss of the Operating Partnership.

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

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

TABLE OF CONTENTS

		PAGE
PART I. FINANCIAL INFORMATION
PART I.	FINANCIAL INFORMATION
Item 1.	FINANCIAL STATEMENTS	4
ITEM 1.	FINANCIAL STATEMENTS
	FINANCIAL STATEMENTS OF SL GREEN REALTY CORP.
	Consolidated Balance Sheets as of September 30, 2013 (unaudited) and December 31, 2012	1
	Consolidated Balance Sheets as of September 30, 2015 (unaudited) and December 31, 2014	4
	Consolidated Statements of Income for the three and nine months ended September 30, 2013 and 2012 (unaudited)	2
	Consolidated Statements of Operations for the three and nine months ended September 30, 2015 and 2014 (unaudited)	6
	Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2013 and 2012 (unaudited)	3
	Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2015 and 2014 (unaudited)	8
	Consolidated Statement of Equity for the nine months ended September 30, 2013 (unaudited)	4
	Consolidated Statement of Equity for the nine months ended September 30, 2015 (unaudited)	9
	Consolidated Statements of Cash Flows for the nine months ended September 30, 2013 and 2012 (unaudited)	5
	Consolidated Statements of Cash Flows for the nine months ended September 30, 2015 and 2014 (unaudited)	10
	FINANCIAL STATEMENTS OF SL GREEN OPERATING PARTNERSHIP, L.P.
	Consolidated Balance Sheets as of September 30, 2013 (unaudited) and December 31, 2012	6
	Consolidated Balance Sheets as of September 30, 2015 (unaudited) and December 31, 2014	12
	Consolidated Statements of Income for the three and nine months ended September 30, 2013 and 2012 (unaudited)	7
	Consolidated Statements of Operations for the three and nine months ended September 30, 2015 and 2014 (unaudited)	14
	Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2013 and 2012 (unaudited)	8
	Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2015 and 2014 (unaudited)	16
	Consolidated Statement of Capital for the nine months ended September 30, 2013 (unaudited)	9
	Consolidated Statement of Capital for the nine months ended September 30, 2015 (unaudited)	17
	Consolidated Statements of Cash Flows for the nine months ended September 30, 2013 and 2012 (unaudited)	10
	Consolidated Statements of Cash Flows for the nine months ended September 30, 2015 and 2014 (unaudited)	18
	Notes to Consolidated Financial Statements (unaudited)	1120
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	48
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	56
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	72
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	76
ITEM 4.	CONTROLS AND PROCEDURES	72
Item 4.	Controls and Procedures (SL Green Realty Corp. and SL Green Operating Partnership, L.P.)	76
PART II.	OTHER INFORMATION	74
PART II. OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	74
Item 1.	Legal Proceedings	77
ITEM 1A.	RISK FACTORS	74
Item 1A.	Risk Factors	77
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	74
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	77
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	74
Item 3.	Defaults Upon Senior Securities	77
ITEM 4.	MINE SAFETY DISCLOSURES	74
Item 4.	Mine Safety Disclosures	77
ITEM 5.	OTHER INFORMATION	74
Item 5.	Other Information	77
ITEM 6.	EXHIBITS	75
Item 6.	Exhibits	78
SIGNATURES		76
	Signatures	79

Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

SL Green Realty Corp.

Consolidated Balance Sheets

(in thousands, except per share data)



	September 30, 2015			December 31, 2014
	(unaudited)
Assets
Commercial real estate properties, at cost:
Land and land interests	$	4,689,031		$	3,844,518
Building and improvements	10,079,151			8,778,593
Building leasehold and improvements	1,425,299			1,418,585
Properties under capital lease	47,445			27,445
	16,240,926			14,069,141
Less: accumulated depreciation	(1,979,824		)	(1,905,165		)
	14,261,102			12,163,976
Assets held for sale	117,885			462,430
Cash and cash equivalents	244,360			281,409
Restricted cash	279,592			149,176
Investment in marketable securities	46,432			39,429
Tenant and other receivables, net of allowance of $15,712 and $18,068 in 2015 and 2014, respectively	66,896			57,369
Related party receivables	11,089			11,735
Deferred rents receivable, net of allowance of $22,190 and $27,411 in 2015 and 2014, respectively	467,627			374,944
Debt and preferred equity investments, net of discounts and deferred origination fees of $16,169 and $19,172 in 2015 and 2014, respectively	1,501,619			1,408,804
Investments in unconsolidated joint ventures	1,239,008			1,172,020
Deferred costs, net	342,936			327,962
Other assets	912,023			647,333
Total assets	$	19,490,569		$	17,096,587
Liabilities
Mortgages and other loans payable	$	6,865,383		$	5,586,709
Revolving credit facility	949,000			385,000
Term loan and senior unsecured notes	2,216,120			2,107,078
Accrued interest payable and other liabilities	204,224			137,634
Accounts payable and accrued expenses	173,228			173,246
Deferred revenue	428,334			187,148
Capital lease obligations	41,171			20,822
Deferred land leases payable	1,557			1,215
Dividend and distributions payable	67,109			64,393
Security deposits	66,654			66,614
Liabilities related to assets held for sale	94			266,873
Junior subordinated deferrable interest debentures held by trusts that issued trust preferred securities	100,000			100,000
Total liabilities	11,112,874			9,096,732
Commitments and contingencies	—			—
Noncontrolling interests in Operating Partnership	423,421			469,524
Preferred units	282,516			71,115

Table of Contents

SL Green Realty Corp.

Consolidated Balance Sheets

(in thousands, except per share data)

		September 30, 2013				December 31, 2012
	September 30, 2015				December 31, 2014
		(Unaudited)
	(unaudited)
Assets
Equity
Commercial real estate properties, at cost:
SL Green stockholders' equity:
Land and land interests		$	2,868,833			$	2,886,099
Series I Preferred Stock, $0.01 par value, $25.00 liquidation preference, 9,200 issued and outstanding at both September 30, 2015 and December 31, 2014	221,932				221,932
Building and improvements		7,440,543				7,389,766
Common stock, $0.01 par value, 160,000 shares authorized and 103,383 and 100,928 issued and outstanding at September 30, 2015 and December 31, 2014, respectively (including 3,724 and 3,603 shares held in Treasury at September 30, 2015 and December 31, 2014, respectively)	1,034				1,010
Building leasehold and improvements		1,353,997				1,346,748
Additional paid-in-capital	5,593,653				5,289,479
Properties under capital lease		50,332				40,340
Treasury stock at cost	(335,311		)		(320,471		)
		11,713,705				11,662,953
Accumulated other comprehensive loss	(15,821		)		(6,980		)
Less: accumulated depreciation		(1,574,002		)		(1,393,323		)
Retained earnings	1,772,833				1,752,404
		10,139,703				10,269,630
Total SL Green stockholders' equity	7,238,320				6,937,374
Assets held for sale		—				4,901
Noncontrolling interests in other partnerships	433,438				521,842
Cash and cash equivalents		209,098				189,984
Total equity	7,671,758				7,459,216
Restricted cash		356,844				136,071
Total liabilities and equity	$	19,490,569			$	17,096,587
Investment in marketable securities		32,863				21,429
Tenant and other receivables, net of allowance of $22,383 and $21,652 in 2013 and 2012, respectively		51,354				48,544
Related party receivables		7,800				7,531
Deferred rents receivable, net of allowance of $29,508 and $29,580 in 2013 and 2012, respectively		374,615				340,747
Debt and preferred equity investments, net of discounts and deferred origination fees of $26,466 and $22,341 in 2013 and 2012, and allowance of $4,000 and $7,000 in 2013 and 2012, respectively		1,315,551				1,348,434
Investments in unconsolidated joint ventures		1,109,815				1,032,243
Deferred costs, net		247,850				261,145
Other assets		729,426				718,326
Total assets		$	14,574,919			$	14,378,985
Liabilities
Mortgages and other loans payable		$	4,641,758			$	4,615,464
Revolving credit facility		340,000				70,000
Term loan and senior unsecured notes		1,737,869				1,734,956
Accrued interest payable and other liabilities		69,359				73,769
Accounts payable and accrued expenses		167,719				159,598
Deferred revenue		293,393				312,995
Capitalized lease obligations		47,492				37,518
Deferred land leases payable		21,066				20,897
Dividend and distributions payable		34,749				37,839
Security deposits		54,824				46,253
Liabilities related to assets held for sale		—				136
Junior subordinate deferrable interest debentures held by trusts that issued trust preferred securities		100,000				100,000
Total liabilities		7,508,229				7,209,425
Commitments and contingencies		—				—
Noncontrolling interest in the Operating Partnership		248,046				212,907
Series G Preferred Units, $25.00 liquidation preference, 1,902 issued and outstanding at both September 30, 2013 and December 31, 2012		47,550				47,550
Series H Preferred Units, $25.00 liquidation preference, 80 issued and outstanding at both September 30, 2013 and December 31, 2012		2,000				2,000
Equity
SL Green stockholders’ equity:
Series C Preferred Stock, $0.01 par value, $25.00 liquidation preference, 7,700 issued and outstanding at December 31, 2012		—				180,340
Series I Preferred Stock, $0.01 par value, $25.00 liquidation preference, 9,200 issued and outstanding at both September 30, 2013 and December 31, 2012		221,932				221,965
Common stock, $0.01 par value, 160,000 shares authorized and 95,780 and 94,896 issued and outstanding at September 30, 2013 and December 31, 2012, respectively (including 3,566 and 3,646 shares held in Treasury at September 30, 2013 and December 31, 2012, respectively)		959				950
Additional paid-in-capital		4,757,778				4,667,900
Treasury stock at cost		(316,989		)		(322,858		)
Accumulated other comprehensive loss		(19,249		)		(29,587		)
Retained earnings		1,636,584				1,701,092
Total SL Green stockholders’ equity		6,281,015				6,419,802
Noncontrolling interests in other partnerships		488,079				487,301
Total equity		6,769,094				6,907,103
Total liabilities and equity		$	14,574,919			$	14,378,985

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

Table of Contents

SL Green Realty Corp.

Consolidated Statements of ~~Income~~Operations

(unaudited, in thousands, except per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	2015			2014			2015			2014
Revenues
Rental revenue, net	$	~~264~~318,~~349~~465		$	~~277~~291,~~676~~293		$	~~804~~926,~~104~~020		$	~~798~~826,~~271~~877
Escalation and reimbursement	4548,~~091~~254			4243,~~194~~826			~~125~~130,~~018~~630			~~124~~120,~~273~~209
Investment and preferred equity income	44,448			27,869			143,887			87,655
Investment income	49,328			43,969			136,588			137,767
Other income	916,~~877~~019			911,~~272~~186			2144,~~369~~201			2548,~~931~~498
Total revenues	~~363~~432,~~765~~066			~~357~~390,~~011~~274			1,~~094~~237,~~378~~439			1,~~036~~133,~~130~~351
Expenses
Operating expenses, including approximately $4,876 and $13,345 (2013) and $4,670 and $12,914 (2012) paid to related parties	77,272			82,351			218,901			221,670
Operating expenses, including $5,238 and $13,415 in 2015 and $5,104 and $13,183 in 2014 of related party expenses	78,648			72,111			225,539			211,118
Real estate taxes	5561,~~511~~009			5355,~~293~~548			~~161~~173,~~625~~018			~~156~~159,~~746~~702
Ground rent	108,~~127~~252			8,~~874~~088			2924,~~767~~526			2624,~~570~~161
Interest expense, net of interest income	8284,~~973~~141			8582,~~659~~376			~~247~~235,~~420~~694			~~247~~236,~~789~~424
Amortization of deferred financing costs	47,~~331~~160			46,~~493~~679			1319,~~034~~727			1115,~~626~~737
Depreciation and amortization	87146,~~473~~185			8194,~~827~~443			~~248~~454,~~587~~087			~~233~~274,~~566~~337
Loan loss and other investment reserves, net of recoveries	—			—			—			564
Transaction related costs	5,829			2,383			10,039			6,554
Transaction related costs, net of recoveries	(2,349		)	1,372			719			4,398
Marketing, general and administrative	23,475			22,649			72,139			69,778
Marketing, general and administrative	20,869			20,551			63,450			61,469
Total expenses	414,699			344,277			1,214,769			997,811
Total expenses	336,207			338,420			983,503			964,398
Income from continuing operations before equity in net income from unconsolidated joint ventures, equity in net gain on sale of interest in unconsolidated joint venture/real estate, purchase price fair value adjustment, gain on sale of real estate, depreciable real estate reserves and loss on early extinguishment of debt	17,367			45,997			22,670			135,540
Income from continuing operations before equity in net income from unconsolidated joint ventures, equity in net (loss) gain on sale of interest in unconsolidated joint venture/real estate, gain (loss) on sale of investment in marketable securities, purchase price fair value adjustment and loss on early extinguishment of debt	27,558			18,591			110,875			71,732
Equity in net income from unconsolidated joint ventures	3,627			6,034			10,651			20,781
Equity in net income from unconsolidated joint ventures	2,939			11,658			4,251			80,988
Equity in net gain on sale of interest in unconsolidated joint venture/real estate	15,281			16,496			16,050			122,580
Equity in net (loss) gain on sale of interest in unconsolidated joint venture/real estate	(354		)	(4,807		)	(3,937		)	17,776
Purchase price fair value adjustment	—			(4,000		)	—			67,446
Gain (loss) on sale of investment in marketable securities	—			2,237			(65		)	2,237
Gain on sale of real estate	159,704			—			159,704			—
Purchase price fair value adjustment	—			—			(2,305		)	—
Depreciable real estate reserves	(19,226		)	—			(19,226		)	—
Loss on early extinguishment of debt	—			—(24,475		)	(~~18,523~~49		)	—(25,500		)
Income from continuing operations	30176,~~143~~753			2740,~~679~~052			90189,~~296~~800			~~172~~320,~~733~~847
Net income from discontinued operations	~~1,406~~—			~~951~~4,035			~~1,725~~427			215,~~883~~449
Gain on sale of discontinued operations	~~13,787~~—			—29,507			1412,~~900~~983			6144,~~627~~242
Net income	45176,~~336~~753			2873,~~630~~594			~~106~~203,~~921~~210			~~182~~480,~~243~~538
Net income attributable to noncontrolling interests:
Noncontrolling interests in the Operating Partnership	(16,~~110~~467		)	(~~567~~2,636		)	(16,~~909~~634		)	(416,~~876~~010		)
Noncontrolling interests in other partnerships	(~~2,901~~665		)	(1,~~835~~712		)	(813,~~806~~217		)	(65,~~792~~045		)
Preferred unit distributions	(562		)	(571		)	(1,692		)	(1,533		)
Preferred units distributions	(2,225		)	(820		)	(4,316		)	(1,950		)
Net income attributable to SL Green	40167,~~763~~396			2568,~~657~~426			94179,~~514~~043			~~169~~457,~~042~~533
Preferred stock redemption costs	—			(10,010		)	(12,160		)	(10,010		)
Perpetual preferred stock dividends	(3,738		)	(3,738		)	(11,214		)	(11,214		)
Perpetual preferred stock dividends	(3,738		)	(7,915		)	(18,144		)	(23,004		)
Net income attributable to SL Green common stockholders	$	163,658		$	64,688		$	167,829		$	446,319
Net income attributable to SL Green common stockholders	$	37,025		$	7,732		$	64,210		$	136,028
Amounts attributable to SL Green common stockholders:
Income from continuing operations	$	22,623		$	11,451		$	54,125		$	109,687
Purchase price fair value adjustment	—			—			(2,239		)	—
Equity in net (loss) gain on sale of interest in unconsolidated joint venture/real estate	(344		)	(4,636		)	(3,825		)	17,160
Net income from discontinued operations	1,365			917			1,676			2,783
Gain on sale of discontinued operations	13,381			—			14,473			6,398
Net income	$	37,025		$	7,732		$	64,210		$	136,028
Basic earnings per share:
Income from continuing operations before discontinued operations	$	0.25		$	0.13		$	0.57		$	1.24
Equity in net (loss) gain on sale of interest in unconsolidated joint venture/real estate	—			(0.05		)	(0.04		)	0.19
Net income from discontinued operations	—			0.01			0.01			0.03
Gain on sale of discontinued operations	0.15			—			0.16			0.07
Net income attributable to SL Green common stockholders	$	0.40		$	0.09		$	0.70		$	1.53
Diluted earnings per share:
Income from continuing operations before discontinued operations	$	0.25		$	0.13		$	0.56		$	1.23
Equity in net (loss) gain on sale of interest in unconsolidated joint venture/real estate	—			(0.05		)	(0.04		)	0.19
Net income from discontinued operations	—			0.01			0.02			0.03
Gain on sale of discontinued operations	0.15			—			0.16			0.07
Net income attributable to SL Green common stockholders	$	0.40		$	0.09		$	0.70		$	1.52
Dividends per share	$	0.33		$	0.25		$	0.99		$	0.75
Basic weighted average common shares outstanding	91,988			90,241			91,684			88,929
Diluted weighted average common shares and common share equivalents outstanding	95,016			93,891			94,631			92,485

Table of Contents

SL Green Realty Corp.

Consolidated Statements of Operations

(unaudited, in thousands, except per share data)



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Amounts attributable to SL Green common stockholders:
Income from continuing operations before purchase price fair value adjustment, gains on sale and discontinued operations	$	13,768		$	20,312		$	4,357		$	108,710
Purchase price fair value adjustment	—			(3,856		)	—			65,111
Equity in net gain on sale of interest in unconsolidated joint venture/real estate	14,705			15,901			15,439			118,336
Net income from discontinued operations	—			3,889			411			14,914
Gain on sale of discontinued operations	—			28,442			12,489			139,248
Gain on sale of real estate	153,687			—			153,628			—
Depreciable real estate reserves	(18,502		)	—			(18,495		)	—
Net income attributable to SL Green common stockholders	$	163,658		$	64,688		$	167,829		$	446,319
Basic earnings per share:
Income from continuing operations before purchase price fair value adjustment, gains on sale and discontinued operations	$	0.14		$	0.21		$	0.04		$	1.14
Purchase price fair value adjustment	—			(0.04		)	—			0.68
Equity in net gain on sale of interest in unconsolidated joint venture/real estate	0.15			0.17			0.16			1.24
Net income from discontinued operations	—			0.04			—			0.16
Gain on sale of discontinued operations	—			0.30			0.13			1.46
Gain on sale of real estate	1.54			—			1.55			—
Depreciable real estate reserves	(0.19		)	—			(0.19		)	—
Net income attributable to SL Green common stockholders	$	1.64		$	0.68		$	1.69		$	4.68
Diluted earnings per share:
Income from continuing operations before purchase price fair value adjustment, gains on sale and discontinued operations	$	0.14		$	0.21		$	0.04		$	1.14
Purchase price fair value adjustment	—			(0.04		)	—			0.68
Equity in net gain on sale of interest in unconsolidated joint venture/real estate	0.15			0.17			0.16			1.23
Net income from discontinued operations	—			0.04			—			0.16
Gain on sale of discontinued operations	—			0.30			0.13			1.45
Gain on sale of real estate	1.54			—			1.54			—
Depreciable real estate reserves	(0.19		)	—			(0.19		)	—
Net income attributable to SL Green common stockholders	$	1.64		$	0.68		$	1.68		$	4.66
Dividends per share	$	0.60		$	0.50		$	1.80		$	1.50
Basic weighted average common shares outstanding	99,621			95,734			99,205			95,437
Diluted weighted average common shares and common share equivalents outstanding	103,929			99,706			103,609			99,322

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

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SL Green Realty Corp.

Consolidated Statements of Comprehensive Income

(unaudited, in thousands)

	Three Months Ended September 30,	~~Three Months Ended September 30,~~							Nine Months Ended September 30,	~~Nine Months Ended September 30,~~
		2013				2012				2013				2012
	2015				2014				2015				2014
Net income	$	$176,753	~~45,336~~		$	$73,594	~~28,630~~		$	$203,210	~~106,921~~		$	$480,538	~~182,243~~
Other comprehensive (loss) income:
Other comprehensive income (loss):
Change in net unrealized (loss) gain on derivative instruments, including SL Green's share of joint venture net unrealized (loss) gain on derivative instruments	(5,423	~~(1,165~~	)	)	3,919	~~(102~~		)	(8,853	~~10,522~~	)		11,380	~~(635~~		)
Change in unrealized gain (loss) on marketable securities	317	~~513~~			(506	~~(825~~	)	)	(337	~~306~~	)		1,282	~~(597~~		)
Other comprehensive (loss) income	(5,106	~~(652~~	)	)	3,413	~~(927~~		)	(9,190	~~10,828~~	)		12,662	~~(1,232~~		)
Comprehensive income	171,647	~~44,684~~			77,007	~~27,703~~			194,020	~~117,749~~			493,200	~~181,011~~
Net income attributable to noncontrolling interests		(4,573		)		(2,973		)		(12,407		)		(13,201		)
Net loss attributable to noncontrolling interests and preferred units distributions	(9,357		)		(5,168		)		(24,167		)		(23,005		)
Other comprehensive loss (income) attributable to noncontrolling interests in the Operating Partnership		25				59				(490		)		396
Other comprehensive income (loss) attributable to noncontrolling interests	191				(113		)		349				(347		)
Comprehensive income attributable to SL Green common stockholders		$	40,136			$	24,789			$	104,852			$	168,206
Comprehensive income attributable to SL Green	$	162,481			$	71,726			$	170,202			$	469,848

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

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SL Green Realty Corp.

Consolidated Statement of Equity

(unaudited, in thousands, except per share data)

	SL Green Realty Corp. Stockholders
	Series CPreferredStock			Series IPreferredStock			Common Stock						AdditionalPaid-In-Capital				TreasuryStock				AccumulatedOtherComprehensiveIncome (Loss)				RetainedEarnings				Noncontrolling Interests
					Common Stock
							Shares		ParValue																								Total
		Series IPreferredStock			Shares		ParValue			AdditionalPaid-In-Capital				TreasuryStock				AccumulatedOtherComprehensiveLoss				RetainedEarnings				NoncontrollingInterests				Total
Balance at December 31, 2012	$	180,340		$	221,965		91,250		$	950			$	4,667,900			$	(322,858	)		$	(29,587	)		$	1,701,092			$	487,301			$	6,907,103
Balance at December 31, 2014		$	221,932		97,325		$	1,010		$	5,289,479			$	(320,471	)		$	(6,980	)		$	1,752,404			$	521,842			$	7,459,216
Net income																						179,043			~~94,514~~	13,217			~~8,806~~	192,260			~~103,320~~
Other comprehensive income																					10,338												10,338
Acquisition of subsidiary interest from noncontrolling interest										(9,566		)														(11,084		)		(20,650		)
Preferred dividends																									(18,144		)						(18,144		)
Other comprehensive loss																		(8,841		)										(8,841		)
DRIP proceeds													57																				57
Preferred dividends																						(11,214		)						(11,214		)
Conversion of units of the Operating Partnership to common stock							224		2				17,285																				17,287
DRSPP proceeds					776		8			99,521																				99,529
Reallocation of noncontrolling interest in the Operating Partnership																									(38,452		)						(38,452		)
Conversion of units of the Operating Partnership to common stock					353		4			41,601																				41,605
Deferred compensation plan							10						655				(221		)														434
Reallocation of noncontrolling interest in the Operating Partnership																						31,664								31,664
Amortization of deferred compensation plan													19,702																				19,702
Reallocation of capital account relating to sale																										(10,144		)		(10,144		)
Redemption of preferred stock	(180,340		)																						(12,160		)						(192,500		)
Deferred compensation plan and stock award, net					28		—			1,744				(4,840		)														(3,096		)
Preferred stock issuance costs				(33		)																											(33		)
Amortization of deferred compensation plan										20,994																				20,994
Issuance of common stock					1,007		~~462~~10		5	137,012			~~41,786~~	(10,000		)														127,022			~~41,791~~
Sale of treasury stock							83										6,090																6,090
Proceeds from stock options exercised					170		2			12,868																				12,870
Proceeds from stock options exercised							185		2				10,393																				10,395
Contributions from consolidated joint venture interests																										34,435				34,435
Contributions to consolidated joint venture																													3,781				3,781
Cash distributions to noncontrolling interests																										(114,828		)		(114,828		)
Cash distributions to noncontrolling interests																													(11,809		)		(11,809		)
Cash distributions declared ($1.80 per common share, none of which represented a return of capital for federal income tax purposes)																						(179,064		)						(179,064		)
Cash distribution declared ($0.99 per common share, none of which represented a return of capital for federal income tax purposes)																									(90,266		)						(90,266		)
Balance at September 30, 2015		$	221,932		99,659		$	1,034		$	5,593,653			$	(335,311	)		$	(15,821	)		$	1,772,833			$	433,438			$	7,671,758
Balance at September 30, 2013	$	—		$	221,932		92,214		$	959			$	4,757,778			$	(316,989	)		$	(19,249	)		$	1,636,584			$	488,079			$	6,769,094

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

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SL Green Realty Corp.

Consolidated Statements of Cash Flows

(unaudited, in thousands)

	Nine Months Ended September 30,	~~Nine Months Ended September 30,~~
		2013				2012
	2015				2014
Operating Activities
Net income	$	$203,210	~~106,921~~		$	$480,538	~~182,243~~
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	473,817	~~264,833~~			295,877	~~249,950~~
Depreciable real estate reserves		2,150				—
Equity in net income from unconsolidated joint ventures	(10,651		)		(20,781		)
Equity in net income from unconsolidated joint ventures		(4,251		)		(80,988		)
Distributions of cumulative earnings from unconsolidated joint ventures	33,141				23,065
Distributions of cumulative earnings from unconsolidated joint ventures		21,723				84,182
Equity in net gain on sale of interest in unconsolidated joint venture interest/real estate	(16,050		)		(122,580		)
Purchase price fair value adjustment	—	~~2,305~~			(71,446	—	)
Equity in net loss (gain) on sale of interest in unconsolidated joint venture/real estate		3,937				(17,776		)
Depreciable real estate reserves	19,226				—
Gain on sale of discontinued operations		(14,900		)		(6,627		)
Gain on sale of real estate	(159,704		)		—
Loan loss and other investment reserves, net of recoveries		—				564
Gain on sale of discontinued operations	(12,983		)		(144,242		)
Gain on sale of investments in marketable securities		—				(2,237		)
Loss on early extinguishment of debt	49				25,500
Loss on early extinguishment of debt		10,968				—
Deferred rents receivable	(99,015		)		(43,736		)
Deferred rents receivable		(44,021		)		(50,910		)
Other non-cash adjustments	(16,140		)		(25,705		)
Other non-cash adjustments		(31,808		)		(864		)
Changes in operating assets and liabilities:
Changes in operating assets and liabilities:
Restricted cash—operations	(23,437		)		(7,124		)
Restricted cash — operations		1,254				(12,557		)
Tenant and other receivables	(8,498		)		(7,336		)
Tenant and other receivables		(3,018		)		(8,500		)
Related party receivables	646				(5,200		)
Related party receivables		(187		)		(3,792		)
Deferred lease costs	(46,673		)		(17,544		)
Deferred lease costs		(28,502		)		(37,885		)
Other assets	(43,736		)		(23,133		)
Other assets		(23,316		)		(44,915		)
Accounts payable, accrued expenses and other liabilities and security deposits	6,119				17,445
Accounts payable, accrued expenses and other liabilities		23,635				11,309
Deferred revenue and land leases payable	23,678				23,608
Deferred revenue and land leases payable		22,731				8,997
Net cash provided by operating activities	322,999				377,206
Net cash provided by operating activities		310,454				270,194
Investing Activities
Investing Activities
Acquisitions of real estate property	(2,574,687		)		(711,437		)
Acquisitions of real estate property		(58,185		)		(405,318		)
Additions to land, buildings and improvements	(219,760		)		(282,947		)
Additions to land, buildings and improvements		(108,849		)		(107,425		)
Escrowed cash—capital improvements/acquisition deposits/deferred purchase price	(117,026		)		(67,868		)
Escrowed cash — capital improvements/acquisition		(246,682		)		(68,692		)
Investments in unconsolidated joint ventures	(127,783		)		(217,187		)
Investments in unconsolidated joint ventures		(120,130		)		(159,524		)
Distributions in excess of cumulative earnings from unconsolidated joint ventures	89,059				158,809
Distributions in excess of cumulative earnings from unconsolidated joint ventures		19,795				48,510
Proceeds from disposition of real estate/joint venture interest	1,072,175				357,426
Net proceeds from disposition of real estate/joint venture interest		218,701				70,367
Proceeds from sale of marketable securities	432				3,669
Other investments		(26,003		)		(28,911		)
Purchases of marketable securities	(7,769		)		(10,025		)
Debt and preferred equity and other investments, net of repayments/participations		78,888				(172,411		)
Other investments	(11,894		)		15,980
Net cash used in investing activities		(242,465		)		(823,404		)
Origination of debt and preferred equity investments	(461,257		)		(421,003		)
Financing Activities
Repayments or redemption of debt and preferred equity investments	372,084				349,320
Proceeds from mortgages and other loans payable		980,333				1,113,500
Net cash used in investing activities	(1,986,426		)		(825,263		)
Repayments of mortgages and other loans payable		(1,027,201		)		(484,518		)
Proceeds from credit facility and senior unsecured notes		844,000				813,339
Repayments of credit facility and senior unsecured notes		(578,970		)		(1,065,793		)
Proceeds from stock options exercised and DRIP issuance		10,452				112,447
Net proceeds from sale of common stock/preferred stock		41,758				423,544
Redemption of preferred stock		(192,500		)		(200,013		)
Sale or purchase of treasury stock		6,089				(11,197		)
Distributions to noncontrolling interests in other partnerships		(11,809		)		(15,622		)
Contributions from noncontrolling interests in other partnerships		3,781				19,181
Distributions to noncontrolling interests in the Operating Partnership		(2,695		)		(2,385		)
Dividends paid on common and preferred stock		(113,192		)		(91,272		)
Deferred loan costs and capitalized lease obligations		(8,921		)		(33,830		)
Net cash (used in) provided by financing activities		(48,875		)		577,381
Net increase in cash and cash equivalents		19,114				24,171
Cash and cash equivalents at beginning of period		189,984				138,192
Cash and cash equivalents at end of period		$	209,098			$	162,363
Supplemental Disclosure of Non-Cash Investing and Financing Activities:
Issuance of common stock as deferred compensation		$	434			$	631
Issuance of units in the Operating Partnership		14,270				40,542
Redemption of units in the Operating Partnership		17,287				17,467
Derivative instruments at fair value		494				375
Assignment of debt investment to joint venture		—				25,362
Mortgage assigned upon asset sale		—				59,099
Tenant improvements and capital expenditures payable		9,855				10,056
Assumption of mortgage loans		84,642				—
Fair value adjustment to noncontrolling interest in the Operating Partnership		38,452				44,893
Accrued acquisition liabilities		—				4,372
Deferred leasing payable		2,849				509
Capital leased asset		9,992				—
Transfer to net assets held for sale		—				86,339
Transfer to liabilities related to net assets held for sale		—				62,792
Repayment of mezzanine loan		—				3,750
Redemption of Series E units		—				31,698
Repayment of financing receivable		—				28,195
Consolidation of real estate investment		90,934				—
Investment in joint venture		—				5,135

Table of Contents

SL Green Realty Corp.

Consolidated Statements of Cash Flows

(unaudited, in thousands)



	Nine Months Ended September 30,
	2015			2014
Financing Activities
Proceeds from mortgages and other loans payable	$	1,706,018		$	2,001,603
Repayments of mortgages and other loans payable	(681,286		)	(1,688,466		)
Proceeds from revolving credit facility and senior unsecured notes	2,130,000			1,136,400
Repayments of revolving credit facility and senior unsecured notes	(1,466,007		)	(805,988		)
Payment of debt extinguishment costs	—			(23,332		)
Proceeds from stock options exercised and DRSSP issuance	112,399			20,549
Proceeds from sale of common stock	124,794			42,698
Redemption of preferred unit	(200		)	—
Distributions to noncontrolling interests in other partnerships	(113,595		)	(5,745		)
Contributions from noncontrolling interests in other partnerships	11,931			27,933
Distributions to noncontrolling interests in the Operating Partnership	(7,017		)	(5,482		)
Dividends paid on common and preferred stock	(191,920		)	(154,907		)
Other obligations related to mortgage loan participations	25,000			—
Deferred loan costs and capitalized lease obligation	(23,739		)	(50,378		)
Net cash provided by financing activities	1,626,378			494,885
Net (decrease) increase in cash and cash equivalents	(37,049		)	46,828
Cash and cash equivalents at beginning of year	281,409			206,692
Cash and cash equivalents at end of period	$	244,360		$	253,520

Supplemental Disclosure of Non-Cash Investing and Financing Activities:
Issuance of common stock as deferred compensation	$	1,744		$	1,503
Issuance of units in the Operating Partnership	27,898			22,862
Redemption of units in the Operating Partnership	41,605			26,392
Derivative instruments at fair value	5,459			12,713
Exchange of debt investment for equity in joint venture	10,151			—
Transfer of restricted cash to operating cash and cash equivalents as a result of sale	21,578			—
Acquisition of subsidiary interest from noncontrolling interest	20,630			—
Tenant improvements and capital expenditures payable	14,470			8,456
Fair value adjustment to noncontrolling interest in the Operating Partnership	31,664			108,453
Capital lease asset	20,000			—
Reclass of development costs from other assets to real estate	47,519			—
Transfer to net assets held for sale	117,885			753,457
Transfer to liabilities related to net assets held for sale	94			461,891
Transfer of financing receivable to debt investment	—			19,675
Deferred leasing payable	6,176			13,086
Consolidation of real estate	—			1,316,591
Deconsolidation of subsidiary	27,435			—
Issuance of common stock	2,228			—
Issuance of common stock to consolidated joint venture	10,000			—
Issuance of preferred units	211,601			27,565
Contribution to consolidated joint venture by noncontrolling interest	22,504			—
Receivable from sale of unconsolidated joint venture interest	15,129			—

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

511

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Balance Sheets

(in thousands, except per unit data)



	September 30, 2015			December 31, 2014
	(unaudited)
Assets
Commercial real estate properties, at cost:
Land and land interests	$	4,689,031		$	3,844,518
Building and improvements	10,079,151			8,778,593
Building leasehold and improvements	1,425,299			1,418,585
Property under capital lease	47,445			27,445
	16,240,926			14,069,141
Less: accumulated depreciation	(1,979,824		)	(1,905,165		)
	14,261,102			12,163,976
Assets held for sale	117,885			462,430
Cash and cash equivalents	244,360			281,409
Restricted cash	279,592			149,176
Investment in marketable securities	46,432			39,429
Tenant and other receivables, net of allowance of $15,712 and $18,068 in 2015 and 2014, respectively	66,896			57,369
Related party receivables	11,089			11,735
Deferred rents receivable, net of allowance of $22,190 and $27,411 in 2015 and 2014, respectively	467,627			374,944
Debt and preferred equity investments, net of discounts and deferred origination fees of $16,169 and $19,172 in 2015 and 2014, respectively	1,501,619			1,408,804
Investments in unconsolidated joint ventures	1,239,008			1,172,020
Deferred costs, net	342,936			327,962
Other assets	912,023			647,333
Total assets	$	19,490,569		$	17,096,587
Liabilities
Mortgages and other loans payable	$	6,865,383		$	5,586,709
Revolving credit facility	949,000			385,000
Term loan and senior unsecured notes	2,216,120			2,107,078
Accrued interest payable and other liabilities	204,224			137,634
Accounts payable and accrued expenses	173,228			173,246
Deferred revenue	428,334			187,148
Capital lease obligations	41,171			20,822
Deferred land leases payable	1,557			1,215
Dividend and distributions payable	67,109			64,393
Security deposits	66,654			66,614
Liabilities related to assets held for sale	94			266,873
Junior subordinated deferrable interest debentures held by trusts that issued trust preferred securities	100,000			100,000
Total liabilities	11,112,874			9,096,732
Commitments and contingencies	—			—
Preferred units	282,516			71,115

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Balance Sheets

(in thousands, except per unit data)

	September 30, 2013			December 31, 2012
	September 30, 2015			December 31, 2014
	(Unaudited)
	(unaudited)
Assets
Commercial real estate properties, at cost:
Land and land interests	$	2,868,833		$	2,886,099
Building and improvements	7,440,543			7,389,766
Building leasehold and improvements	1,353,997			1,346,748
Properties under capital lease	50,332			40,340
	11,713,705			11,662,953
Less: accumulated depreciation	(1,574,002		)	(1,393,323		)
	10,139,703			10,269,630
Assets held for sale	—			4,901
Cash and cash equivalents	209,098			189,984
Restricted cash	356,844			136,071
Investment in marketable securities	32,863			21,429
Tenant and other receivables, net of allowance of $22,383 and $21,652 in 2013 and 2012, respectively	51,354			48,544
Related party receivables	7,800			7,531
Deferred rents receivable, net of allowance of $29,508 and $29,580 in 2013 and 2012, respectively	374,615			340,747
Debt and preferred equity investments, net of discounts and deferred origination fees of $26,466 and $22,341 and allowance of $4,000 and $7,000 in 2013 and 2012, respectively	1,315,551			1,348,434
Investments in unconsolidated joint ventures	1,109,815			1,032,243
Deferred costs, net	247,850			261,145
Other assets	729,426			718,326
Total assets	$	14,574,919		$	14,378,985
Liabilities
Mortgages and other loans payable	$	4,641,758		$	4,615,464
Revolving credit facility	340,000			70,000
Term loan and senior unsecured notes	1,737,869			1,734,956
Accrued interest payable and other liabilities	69,359			73,769
Accounts payable and accrued expenses	167,719			159,598
Deferred revenue	293,393			312,995
Capitalized lease obligations	47,492			37,518
Deferred land leases payable	21,066			20,897
Dividend and distributions payable	34,749			37,839
Security deposits	54,824			46,253
Liabilities related to assets held for sale	—			136
Junior subordinate deferrable interest debentures held by trusts that issued trust preferred securities	100,000			100,000
Total liabilities	7,508,229			7,209,425
Commitments and contingencies	—			—
Series G Preferred Units, $25.00 liquidation preference, 1,902 issued and outstanding at both September 30, 2013 and December 31, 2012	47,550			47,550
Series H Preferred Units, $25.00 liquidation preference, 80 issued and outstanding at both September 30, 2013 and December 31, 2012	2,000			2,000
Capital
SLGOP partners’ capital:
SLGOP partners' capital:
Series C Preferred Units, 7,700 issued and outstanding at December 31, 2012	—			180,340
Series I Preferred Units, $25.00 liquidation preference, 9,200 issued and outstanding at both September 30, 2015 and December 31, 2014	221,932			221,932
Series I Preferred Units, 9,200 issued and outstanding at both September 30, 2013 and December 31, 2012	221,932			221,965
SL Green partners' capital (1,035 and 1,013 general partner common units and 98,624 and 96,312 limited partner common units outstanding at September 30, 2015 and December 31, 2014, respectively)	7,357,047			7,078,924
SL Green partners’ capital (950 and 940 general partner common units and 91,264 and 90,310 limited partner common units outstanding at September 30, 2013 and December 31, 2012, respectively)	6,259,229			6,189,529
Limited partner interests in SLGOP (3,875 and 3,973 limited partner common units outstanding at September 30, 2015 and December 31, 2014, respectively)	99,208			113,298
Limited partner interests in SLGOP (2,792 and 2,760 limited partner common units outstanding at September 30, 2013 and December 31, 2012, respectively	67,721			71,524
Accumulated other comprehensive loss	(16,446		)	(7,256		)
Accumulated other comprehensive loss	(19,821		)	(30,649		)
Total SLGOP partners' capital	7,661,741			7,406,898
Total SLGOP partners’ capital	6,529,061			6,632,709
Noncontrolling interests in other partnerships	433,438			521,842
Noncontrolling interests in other partnerships	488,079			487,301
Total capital	8,095,179			7,928,740
Total capital	7,017,140			7,120,010
Total liabilities and capital	$	19,490,569		$	17,096,587
Total liabilities and capital	$	14,574,919		$	14,378,985

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

613

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SL Green Operating Partnership, L.P.

Consolidated Statements of ~~Income~~Operations

(unaudited, in thousands, except per unit data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	2015			2014			2015			2014
Revenues
Rental revenue, net	$	~~264~~318,~~349~~465		$	~~277~~291,~~676~~293		$	~~804~~926,~~104~~020		$	~~798~~826,~~271~~877
Escalation and reimbursement	4548,~~091~~254			4243,~~194~~826			~~125~~130,~~018~~630			~~124~~120,~~273~~209
Investment and preferred equity income	44,448			27,869			143,887			87,655
Investment income	49,328			43,969			136,588			137,767
Other income	916,~~877~~019			911,~~272~~186			2144,~~369~~201			2548,~~931~~498
Total revenues	~~363~~432,~~765~~066			~~357~~390,~~011~~274			1,~~094~~237,~~378~~439			1,~~036~~133,~~130~~351
Expenses
Operating expenses, including approximately $4,876 and $13,345 (2013) and $4,670 and $12,914 (2012) paid to related parties	77,272			82,351			218,901			221,670
Operating expenses, including $5,238 and $13,415 in 2015 and $5,104 and $13,183 in 2014 of related party expenses	78,648			72,111			225,539			211,118
Real estate taxes	5561,~~511~~009			5355,~~293~~548			~~161~~173,~~625~~018			~~156~~159,~~746~~702
Ground rent	108,~~127~~252			8,~~874~~088			2924,~~767~~526			2624,~~570~~161
Interest expense, net of interest income	8284,~~973~~141			8582,~~659~~376			~~247~~235,~~420~~694			~~247~~236,~~789~~424
Amortization of deferred financing costs	47,~~331~~160			46,~~493~~679			1319,~~034~~727			1115,~~626~~737
Depreciation and amortization	87146,~~473~~185			8194,~~827~~443			~~248~~454,~~587~~087			~~233~~274,~~566~~337
Loan loss and other investment reserves, net of recoveries	—			—			—			564
Transaction related costs	5,829			2,383			10,039			6,554
Transaction related costs, net of recoveries	(2,349		)	1,372			719			4,398
Marketing, general and administrative	23,475			22,649			72,139			69,778
Marketing, general and administrative	20,869			20,551			63,450			61,469
Total expenses	414,699			344,277			1,214,769			997,811
Total expenses	336,207			338,420			983,503			964,398
Income from continuing operations before equity in net income from unconsolidated joint ventures, equity in net gain on sale of interest in unconsolidated joint venture/real estate, purchase price fair value adjustment, gain on sale of real estate, depreciable real estate reserves, and loss on early extinguishment of debt	17,367			45,997			22,670			135,540
Income from continuing operations before equity in net income from unconsolidated joint ventures, equity in net (loss) gain on sale of interest in unconsolidated joint venture/real estate, gain (loss) on sale of investment in marketable securities, purchase price fair value adjustment and loss on early extinguishment of debt	27,558			18,591			110,875			71,732
Equity in net income from unconsolidated joint ventures	3,627			6,034			10,651			20,781
Equity in net income from unconsolidated joint ventures	2,939			11,658			4,251			80,988
Equity in net gain on sale of interest in unconsolidated joint venture/real estate	15,281			16,496			16,050			122,580
Equity in net (loss) gain on sale of interest in unconsolidated joint venture/real estate	(354		)	(4,807		)	(3,937		)	17,776
Purchase price fair value adjustment	—			(4,000		)	—			67,446
Gain (loss) on sale of investment in marketable securities	—			2,237			(65		)	2,237
Gain on sale of real estate	159,704			—			159,704			—
Purchase price fair value adjustment	—			—			(2,305		)	—
Depreciable real estate reserves	(19,226		)	—			(19,226		)	—
Loss on early extinguishment of debt	—			—(24,475		)	(~~18,523~~49		)	—(25,500		)
Income from continuing operations	30176,~~143~~753			2740,~~679~~052			90189,~~296~~800			~~172~~320,~~733~~847
Net income from discontinued operations	~~1,406~~—			~~951~~4,035			~~1,725~~427			215,~~883~~449
Gain on sale of discontinued operations	~~13,787~~—			—29,507			1412,~~900~~983			6144,~~627~~242
Net income	45176,~~336~~753			2873,~~630~~594			~~106~~203,~~921~~210			~~182~~480,~~243~~538
Net income attributable to noncontrolling interests in other partnerships	(~~2,901~~665		)	(1,~~835~~712		)	(813,~~806~~217		)	(65,~~792~~045		)
Preferred unit distributions	(~~562~~2,225		)	(~~571~~820		)	(14,~~692~~316		)	(1,~~533~~950		)
Net income attributable to SLGOP	41173,~~873~~863			2671,~~224~~062			96185,~~423~~677			~~173~~473,~~918~~543
Preferred unit redemption costs	—			(10,010		)	(12,160		)	(10,010		)
Perpetual preferred unit distributions	(3,738		)	(3,738		)	(11,214		)	(11,214		)
Perpetual preferred unit distributions	(3,738		)	(7,915		)	(18,144		)	(23,004		)
Net income attributable to SLGOP common unitholders	$	170,125		$	67,324		$	174,463		$	462,329
Net income attributable to SLGOP common unitholders	$	38,135		$	8,299		$	66,119		$	140,904
Amounts attributable to SLGOP common unitholders:
Income from continuing operations	$	23,296		$	12,155		$	55,736		$	113,618
Purchase price fair value adjustment	—			—			(2,305		)	—
Equity in net (loss) gain on sale of interest in unconsolidated joint venture/real estate	(354		)	(4,807		)	(3,937		)	17,776
Net income from discontinued operations	1,406			951			1,725			2,883
Gain on sale of discontinued operations	13,787			—			14,900			6,627
Net income	$	38,135		$	8,299		$	66,119		$	140,904
Basic earnings per unit:
Income from continuing operations before discontinued operations	$	0.25		$	0.13		$	0.57		$	1.24
Equity in net (loss) gain on sale of interest in unconsolidated joint venture/real estate	—			(0.05		)	(0.04		)	0.19
Net income from discontinued operations	—			0.01			0.01			0.03
Gain on sale of discontinued operations	0.15			—			0.16			0.07
Net income attributable to SLGOP common unitholders	$	0.40		$	0.09		$	0.70		$	1.53
Diluted earnings per unit:
Income from continuing operations before discontinued operations	$	0.25		$	0.13		$	0.56		$	1.23
Equity in net (loss) gain on sale of interest in unconsolidated joint venture/real estate	—			(0.05		)	(0.04		)	0.19
Net income from discontinued operations	—			0.01			0.02			0.03
Gain on sale of discontinued operations	0.15			—			0.16			0.07
Net income attributable to SLGOP common unitholders	$	0.40		$	0.09		$	0.70		$	1.52
Dividends per unit	$	0.33		$	0.25		$	0.99		$	0.75
Basic weighted average common units outstanding	94,780			93,561			94,389			92,117
Diluted weighted average common units and common unit equivalents outstanding	95,016			93,891			94,631			92,485

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Statements of Operations

(unaudited, in thousands, except per unit data)



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Amounts attributable to SLGOP common unitholders:
Income from continuing operations before purchase price fair value adjustment, gains on sale and discontinued operations	$	14,366		$	21,286		$	4,525		$	112,612
Purchase price fair value adjustment	—			(4,000		)	—			67,446
Equity in net gain on sale of interest in unconsolidated joint venture/real estate	15,281			16,496			16,050			122,580
Net income from discontinued operations	—			4,035			427			15,449
Gain on sale of discontinued operations	—			29,507			12,983			144,242
Gain on sale of real estate	159,704			—			159,704			—
Depreciable real estate reserves	(19,226		)	—			(19,226		)	—
Net income attributable to SLGOP common unitholders	$	170,125		$	67,324		$	174,463		$	462,329

Basic earnings per unit:
Income from continuing operations before gains on sale and discontinued operations	$	0.14		$	0.21		$	0.04		$	1.14
Purchase price fair value adjustment	—			(0.04		)	—			0.68
Equity in net gain on sale of interest in unconsolidated joint venture/real estate	0.15			0.17			0.16			1.24
Net income from discontinued operations	—			0.04			—			0.16
Gain on sale of discontinued operations	—			0.30			0.13			1.46
Gain on sale of real estate	1.54			—			1.55			—
Depreciable real estate reserves	(0.19		)	—			(0.19		)	—
Net income attributable to SLGOP common unitholders	$	1.64		$	0.68		$	1.69		$	4.68
Diluted earnings per unit:
Income from continuing operations before gains on sale and discontinued operations	$	0.14		$	0.21		$	0.04		$	1.14
Purchase price fair value adjustment	—			(0.04		)	—			0.68
Equity in net gain on sale of interest in unconsolidated joint venture/real estate	0.15			0.17			0.16			1.23
Net income from discontinued operations	—			0.04			—			0.16
Gain on sale of discontinued operations	—			0.30			0.13			1.45
Gain on sale of real estate	1.54			—			1.54			—
Depreciable real estate reserves	(0.19		)	—			(0.19		)	—
Net income attributable to SLGOP common unitholders	$	1.64		$	0.68		$	1.68		$	4.66
Dividends per unit	$	0.60		$	0.50		$	1.80		$	1.50
Basic weighted average common units outstanding	103,522			99,319			103,129			98,860
Diluted weighted average common units and common unit equivalents outstanding	103,929			99,706			103,609			99,322

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

715

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SL Green Operating Partnership, L.P.

Consolidated Statements of Comprehensive (Loss) Income

(unaudited, in thousands)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
	2015			2014			2015			2014
Net income	$	45176,~~336~~753		$	2873,~~630~~594		$	~~106~~203,~~921~~210		$	~~182~~480,~~243~~538
Other comprehensive (loss) income:
Other comprehensive income (loss):
Change in net unrealized (loss) gain on derivative instruments, including SL Green's share of joint venture net unrealized (loss) gain on derivative instruments	(1,165		)	(102		)	10,522			(635		)
Change in net unrealized (loss) gain on derivative instruments, including SLGOP's share of joint venture net unrealized (loss) gain on derivative instruments	(5,423		)	3,919			(8,853		)	11,380
Change in unrealized gain (loss) on marketable securities	513			(825		)	306			(597		)
Change in unrealized gain on marketable securities	317			(506		)	(337		)	1,282
Other comprehensive (loss) income	(~~652~~5,106		)	~~(927~~3,413		)	10(9,~~828~~190		)	(112,~~232~~662		)
Comprehensive income	44171,~~684~~647			2777,~~703~~007			~~117~~194,~~749~~020			~~181~~493,~~011~~200
Net income attributable to noncontrolling interests in other partnerships	(2,901		)	(1,835		)	(8,806		)	(6,792		)
Net income attributable to noncontrolling interests	(665		)	(1,712		)	(13,217		)	(5,045		)
Comprehensive income attributable to SLGOP	$	41170,~~783~~982		$	2575,~~868~~295		$	~~108~~180,~~943~~803		$	~~174~~488,~~219~~155

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

816

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Statement of Capital

(unaudited, in thousands, except per unit data)

	SL Green Operating Partnership Unitholders
	Series C Preferred Units			Series I Preferred Units				General Partner						Limited Partners					AccumulatedOther ComprehensiveIncome (Loss)
				General Partner						Limited Partners
								CommonUnits		CommonUnitholders				CommonUnits		CommonUnitholders						Noncontrolling Interests			Total
	Series IPreferredUnits			CommonUnits			CommonUnitholders			CommonUnits			CommonUnitholders			AccumulatedOtherComprehensive Loss			NoncontrollingInterests			Total
Balance at December 31, 2012	$	180,340		$	221,965			91,250		$	6,189,529			2,760		$	71,524		$	(30,649	)	$	487,301		$	7,120,010
Balance at December 31, 2014	$	221,932		97,325			$	7,078,924		3,973			$	113,298		$	(7,256	)	$	521,842		$	7,928,740
Net income	611,~~932~~214			~~11,212~~			167,829			~~76,370~~			6,634			~~1,909~~			13,217			8198,~~806~~894			~~105,229~~
Other comprehensive income																			10,828						10,828
Acquisition of subsidiary interest from noncontrolling interest							(9,566		)										(11,084		)	(20,650		)
Preferred distributions	(6,932		)	(11,212		)																			(18,144		)
Other comprehensive loss																(9,190		)				(9,190		)
DRIP proceeds										57															57
Preferred distributions	(11,214		)																			(11,214		)
Conversion of units								224		17,287				(224	)	(17,287		)							—
Issuance of common units										255			27,898									27,898
Issuance of units														256		14,270									14,270
DRSPP proceeds				776			99,529															99,529
Deferred compensation plan								10		434															434
Conversion of units of the Operating Partnership to common stock				353			41,605			(353	)		(41,605		)							—
Amortization of deferred compensation plan										19,702															19,702
Reallocation of capital account relating to sale																			(10,144		)	(10,144		)
Redemption of preferred units	(180,340		)							(12,160		)													(192,500		)
Deferred compensation plan and stock award, net				28			(3,096		)													(3,096		)
Preferred units issuance costs				(33		)																			(33		)
Amortization of deferred compensation plan							20,994															20,994
Contributions - net proceeds from common stock offering								462		41,791															41,791
Contribution to consolidated joint venture interest																			34,435			34,435
Contributions - treasury shares								83		6,090															6,090
Contributions - net proceeds from common stock offering				1,007			127,022															127,022
Contributions - proceeds from stock options exercised				170			12,870	~~185~~		~~10,395~~												12,870			~~10,395~~
Contributions to consolidated joint venture																						3,781			3,781
Cash distributions to noncontrolling interests																			(114,828		)	(114,828		)
Distributions to noncontrolling interests																						(11,809		)	(11,809		)
Cash distributions declared ($1.80 per common unit, none of which represented a return of capital for federal income tax purposes)							(179,064		)				(7,017		)							(186,081		)
Cash distribution declared ($0.99 per common unit, none of which represented a return of capital for federal income tax purposes)										(90,266		)				(2,695		)							(92,961		)
Balance at September 30, 2015	$	221,932		99,659			$	7,357,047		3,875			$	99,208		$	(16,446	)	$	433,438		$	8,095,179
Balance at September 30, 2013	$	—		$	221,932			92,214		$	6,259,229			2,792		$	67,721		$	(19,821	)	$	488,079		$	7,017,140

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

917

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Statements of Cash Flows

(unaudited, in thousands)

	Nine Months Ended September 30,	~~Nine Months Ended September 30,~~
		2013				2012
	2015				2014
Operating Activities
Net income	$	$203,210	~~106,921~~		$	$480,538	~~182,243~~
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	473,817	~~264,833~~			295,877	~~249,950~~
Depreciable real estate reserves		2,150				—
Equity in net income from unconsolidated joint ventures	(10,651		)		(20,781		)
Equity in net income from unconsolidated joint ventures		(4,251		)		(80,988		)
Distributions of cumulative earnings from unconsolidated joint ventures	33,141				23,065
Distributions of cumulative earnings from unconsolidated joint ventures		21,723				84,182
Equity in net gain on sale of interest in unconsolidated joint venture interest/real estate	(16,050		)		(122,580		)
Purchase price fair value adjustment	—	~~2,305~~			(71,446	—	)
Equity in net loss (gain) on sale of interest in unconsolidated joint venture/real estate		3,937				(17,776		)
Depreciable real estate reserves	19,226				—
Gain on sale of discontinued operations		(14,900		)		(6,627		)
Gain on sale of real estate	(159,704		)		—
Loan loss and other investment reserves, net of recoveries		—				564
Gain on sale of discontinued operations	(12,983		)		(144,242		)
Gain on sale of investments in marketable securities		—				(2,237		)
Loss on early extinguishment of debt	49				25,500
Loss on early extinguishment of debt		10,968				—
Deferred rents receivable	(99,015		)		(43,736		)
Deferred rents receivable		(44,021		)		(50,910		)
Other non-cash adjustments	(16,140		)		(25,705		)
Other non-cash adjustments		(31,808		)		(864		)
Changes in operating assets and liabilities:
Changes in operating assets and liabilities:
Restricted cash—operations	(23,437		)		(7,124		)
Restricted cash — operations		1,254				(12,557		)
Tenant and other receivables	(8,498		)		(7,336		)
Tenant and other receivables		(3,018		)		(8,500		)
Related party receivables	646				(5,200		)
Related party receivables		(187		)		(3,792		)
Deferred lease costs	(46,673		)		(17,544		)
Deferred lease costs		(28,502		)		(37,885		)
Other assets	(43,736		)		(23,133		)
Other assets		(23,316		)		(44,915		)
Accounts payable, accrued expenses and other liabilities and security deposits	6,119				17,445
Accounts payable, accrued expenses and other liabilities		23,635				11,309
Deferred revenue and land leases payable	23,678				23,608
Deferred revenue and land leases payable		22,731				8,997
Net cash provided by operating activities	322,999				377,206
Net cash provided by operating activities		310,454				270,194
Investing Activities
Investing Activities
Acquisitions of real estate property	(2,574,687		)		(711,437		)
Acquisitions of real estate property		(58,185		)		(405,318		)
Additions to land, buildings and improvements	(219,760		)		(282,947		)
Additions to land, buildings and improvements		(108,849		)		(107,425		)
Escrowed cash—capital improvements/acquisition deposits/deferred purchase price	(117,026		)		(67,868		)
Escrowed cash — capital improvements/acquisition		(246,682		)		(68,692		)
Investments in unconsolidated joint ventures	(127,783		)		(217,187		)
Investments in unconsolidated joint ventures		(120,130		)		(159,524		)
Distributions in excess of cumulative earnings from unconsolidated joint ventures	89,059				158,809
Distributions in excess of cumulative earnings from unconsolidated joint ventures		19,795				48,510
Proceeds from disposition of real estate/joint venture interest	1,072,175				357,426
Net proceeds from disposition of real estate/joint venture interest		218,701				70,367
Proceeds from sale of marketable securities	432				3,669
Other investments		(26,003		)		(28,911		)
Purchases of marketable securities	(7,769		)		(10,025		)
Debt and preferred equity and other investments, net of repayments/participations		78,888				(172,411		)
Other investments	(11,894		)		15,980
Net cash used in investing activities		(242,465		)		(823,404		)
Origination of debt and preferred equity investments	(461,257		)		(421,003		)
Financing Activities
Repayments or redemption of debt and preferred equity investments	372,084				349,320
Proceeds from mortgages and other loans payable		980,333				1,113,500
Net cash used in investing activities	(1,986,426		)		(825,263		)
Repayments of mortgages and other loans payable		(1,027,201		)		(484,518		)
Proceeds from credit facility and senior unsecured notes		844,000				813,339
Repayments of credit facility and senior unsecured notes		(578,970		)		(1,065,793		)
Contributions of proceeds from stock options exercised and DRIP issuance		10,452				112,447
Contributions of net proceeds from sale of common stock/preferred stock		41,758				423,544
Redemption of preferred units		(192,500		)		(200,013		)
Sale or purchase of treasury stock		6,089				(11,197		)
Distributions to noncontrolling interests in other partnerships		(11,809		)		(15,622		)
Contributions from noncontrolling interests in other partnerships		3,781				19,181
Distributions paid on common and preferred units		(115,887		)		(93,657		)
Deferred loan costs and capitalized lease obligations		(8,921		)		(33,830		)
Net cash (used in) provided by financing activities		(48,875		)		577,381
Net increase in cash and cash equivalents		19,114				24,171
Cash and cash equivalents at beginning of period		189,984				138,192
Cash and cash equivalents at end of period		$	209,098			$	162,363
Supplemental Disclosure of Non-Cash Investing and Financing Activities:
Issuance of common stock as deferred compensation		$	434			$	631
Issuance of units in the Operating Partnership		14,270				40,542
Redemption of units in the Operating Partnership		17,287				17,467
Derivative instruments at fair value		494				375
Assignment of debt investment to joint venture		—				25,362
Mortgage assigned upon asset sale		—				59,099
Tenant improvements and capital expenditures payable		9,855				10,056
Assumption of mortgage loans		84,642				—
Accrued acquisition liabilities		—				4,372
Deferred leasing payable		2,849				509
Capital leased asset		9,992				—
Transfer to net assets held for sale		—				86,339
Transfer to liabilities related to net assets held for sale		—				62,792
Repayment of mezzanine loan		—				3,750
Redemption of Series E units		—				31,698
Repayment of financing receivable		—				28,195
Consolidation of real estate investment		90,934				—
Investment in joint venture		—				5,135

Table of Contents

SL Green Operating Partnership, L.P.

Consolidated Statements of Cash Flows

(unaudited, in thousands)



	Nine Months Ended September 30,
	2015			2014
Financing Activities
Proceeds from mortgages and other loans payable	$	1,706,018		$	2,001,603
Repayments of mortgages and other loans payable	(681,286		)	(1,688,466		)
Proceeds from revolving credit facility, term loan and senior unsecured notes	2,130,000			1,136,400
Repayments of revolving credit facility, term loan and senior unsecured notes	(1,466,007		)	(805,988		)
Payments of debt extinguishment costs	—			(23,332		)
Proceeds from stock options exercised and DRSSP issuance	112,399			20,549
Net proceeds from sale of common stock	124,794			42,698
Redemption of preferred units	(200		)	—
Distributions to noncontrolling interests in other partnerships	(113,595		)	(5,745		)
Contributions from noncontrolling interests in other partnerships	11,931			27,933
Distributions paid on common and preferred units	(198,937		)	(160,389		)
Other obligations related to mortgage loan participations	25,000			—
Deferred loan costs and capitalized lease obligation	(23,739		)	(50,378		)
Net cash provided by financing activities	1,626,378			494,885
Net (decrease) increase in cash and cash equivalents	(37,049		)	46,828
Cash and cash equivalents at beginning of year	281,409			206,692
Cash and cash equivalents at end of period	$	244,360		$	253,520

Supplemental Disclosure of Non-Cash Investing and Financing Activities:
Issuance of common stock as deferred compensation	$	1,744		$	1,503
Issuance of units in the Operating Partnership	27,898			22,862
Redemption of units in the Operating Partnership	41,605			26,392
Derivative instruments at fair value	5,459			12,713
Exchange of debt investment for equity in joint venture	10,151			—
Transfer of restricted cash to operating cash and cash equivalents as a result of sale	21,578			—
Acquisition of subsidiary interest from noncontrolling interest	20,630			—
Tenant improvements and capital expenditures payable	14,470			8,456
Capital lease asset	20,000			—
Reclass of development costs from other assets to real estate	47,519			—
Transfer to net assets held for sale	117,885			753,457
Transfer to liabilities related to net assets held for sale	94			461,891
Transfer of financing receivable to debt investment	—			19,675
Deferred leasing payable	6,176			13,086
Consolidation of real estate	—			1,316,591
Deconsolidation of subsidiary	27,435			—
Issuance of common stock	2,228			—
Issuance of common stock to consolidated joint venture	10,000			—
Issuance of preferred units	211,601			27,565
Contribution to consolidated joint venture by noncontrolling interest	22,504			—
Receivable from sale of unconsolidated joint venture interests	15,129			—

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

1019

Table of Contents

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

Notes to Consolidated Financial Statements

September 30, ~~2013~~2015

(unaudited)

1. Organization and Basis of Presentation

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

Substantially all of our assets are held by, and all of our operations are conducted through, the Operating Partnership. The Company is the sole managing general partner of the Operating Partnership. As of September 30, ~~2013~~2015, noncontrolling investors held, in the aggregate, a 23.9474% limited partnership interest in the Operating Partnership. We refer to these interests as the noncontrolling interests in the Operating Partnership. See Note 11, “"Noncontrolling Interests on the Company's Consolidated Financial Statements.”"

Reckson Associates Realty Corp., or Reckson, and Reckson Operating Partnership, L.P., or ROP, are wholly-owned subsidiaries of the Operating Partnership.

As of September 30, ~~2013~~2015, we owned the following interests in commercial ~~office~~and residential properties in the New York Metropolitan area, primarily in midtown Manhattan~~, a borough of New York City~~. Our investments in the New York Metropolitan area also include investments in Brooklyn, Long Island, Westchester County, Connecticut and ~~Northern~~ New Jersey, which are collectively known as the Suburban ~~assets~~properties:

Location	Ownership		Number ofProperties		Square Feet	Weighted AverageOccupancy(1)
			Consolidated			Unconsolidated			Total
Manhattan	Consolidated properties		26		18,012,945	93.8	%
Location	Type		Number of Properties		Approximate Square Feet	Number of Properties		Approximate Square Feet	Number of Properties	Approximate Square Feet	Weighted Average Occupancy(1)
	Unconsolidated properties		9		5,934,434	96.2	%
Commercial:
Suburban	Consolidated properties		26		4,087,400	79.1	%
Manhattan	Office		26		20,700,091	6		3,328,496	32	24,028,587	94.5	%
	Unconsolidated properties		4		1,222,100	85.3	%
	Retail		9	(3)	408,993	9		347,970	18	756,963	91.2	%
			65		29,256,879	91.9	%
	Development/Redevelopment	(2)	5		72,962	4		1,952,782	9	2,025,744	53.8	%
	Fee Interest		2		783,530	—		—	2	783,530	100.0	%
			42		21,965,576	19		5,629,248	61	27,594,824	91.5	%
Suburban	Office	(2)	28		4,450,400	3		705,641	31	5,156,041	80.1	%
	Retail		1		52,000	—		—	1	52,000	100.0	%
	Development/Redevelopment		1		1,000	1		—	2	1,000	100.0	%
			30		4,503,400	4		705,641	34	5,209,041	80.3	%
Total commercial properties			72		26,468,976	23		6,334,889	95	32,803,865	89.8	%
Residential:
Manhattan	Residential		4	(3)	762,587	18		2,210,233	22	2,972,820	94.6	%
Suburban	Residential		1		66,611	—		—	1	66,611	95.8	%
Total residential properties			5		829,198	18		2,210,233	23	3,039,431	94.6	%
Total portfolio			77		27,298,174	41		8,545,122	118	35,843,296	90.2	%

____________________________________________________________________

~~_________________________________~~20

(1) The weighted average occupancy represents the total leased square feet divided by total available rentable square feet.

As of September 30, 2013, we also owned investments in 16 retail properties encompassing approximately 621,300 square feet, 13 development properties encompassing approximately 2,424,600 square feet, three residential properties encompassing 468 units (approximately 497,100 square feet), two land interests encompassing approximately 961,400 square feet and 28 west coast office properties encompassing approximately 3,654,300 square feet. In addition, we manage two office properties owned by third parties and affiliated companies encompassing approximately 626,400 rentable square feet. As of September 30, 2013, we also held debt and preferred equity investments with a book value of $1.3 billion.

Partnership Agreement

Table of Contents

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

Notes to Consolidated Financial Statements (cont.)

September 30, ~~2013~~2015

(unaudited)

in(1) ~~our~~The ~~sole~~weighted ~~discretion,~~average tooccupancy ~~cause~~for ~~the~~commercial ~~Operating~~properties ~~Partnership~~represents ~~to distribute sufficient amounts to enable~~ the ~~payment~~total ofoccupied ~~sufficient~~square ~~dividends~~feet divided by ustotal toavailable ~~minimize~~rentable ~~any~~square ~~Federal income or excise tax at the Company level~~feet. ~~Under~~The ~~the~~weighted ~~Operating~~average ~~Partnership~~occupancy ~~Agreement,~~for ~~each~~residential ~~limited~~properties ~~partner~~represents ~~has~~ the ~~right~~total tooccupied ~~redeem~~ units ofdivided ~~limited~~by ~~partnership~~total ~~interests~~available ~~for cash, or if we so elect, for shares of our common stock on a one-for-one basis~~units.


(2)	Includes two Manhattan redevelopment properties and two suburban office properties held for sale as of September 30, 2015.


(3)	As of September 30, 2015, we owned a building that was comprised of approximately 270,132 square feet of retail space and approximately 222,855 square feet of residential space. For the purpose of this report, we have included the building in the retail properties count and have bifurcated the square footage into the retail and residential components.

As of September 30, 2015, we also managed an approximately 336,201 square foot office building owned by a third party and held debt and preferred equity investments with a book value of $1.5 billion.

Partnership Agreement

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

Basis of Quarterly Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for the fair presentation of the financial position of the Company and the Operating Partnership at September 30, ~~2013~~2015 and the results of operations for the periods presented have been included. The ~~2013~~ operating results for the period presented are not necessarily indicative of the results that may be expected for the year ending December 31, ~~2013~~2015. These financial statements should be read in conjunction with the financial statements and accompanying notes included in the Annual ~~Reports~~Report on Form 10-K for the year ended December 31, ~~2012~~2014 of the Company and the Operating Partnership.

The consolidated balance sheets at December 31, ~~2012~~2014 have been derived from the audited financial statements atas of that date but ~~does~~do not include all the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements.

2. Significant Accounting Policies

Principles of Consolidation

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

We consolidate a variable interest ~~entities~~entity, or ~~VIEs~~VIE, in which we are considered the primary beneficiary. The primary beneficiary ~~of a VIE~~ is the entity that has (i) the power to direct the activities that most significantly impact the entity’'s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could be significant to the VIE. Included in commercial real estate properties on our consolidated balance sheets as of September 30, ~~2013~~2015 and December 31, ~~2012~~2014 are ~~approximately~~ $~~600~~198.16 million and $~~607~~198.4 million, respectively, related to our consolidated VIEs. Included in mortgages and other loans payable on our consolidated balance sheets as of September 30, ~~2013~~2015 and December 31, ~~2012~~2014 are ~~approximately~~ $~~373~~105.10 million and $~~379~~106.65 million, respectively, related to our consolidated VIEs. As of September 30, 2015, assets held for sale and liabilities related to assets held for sale on the consolidated balance sheets did not include amounts related to consolidated VIEs. As of December 31, 2014, assets held for sale and liabilities related to assets held for sale on the consolidated balance sheets included $445.0 million of commercial real estate and $253.9 million of mortgage related to the consolidated VIEs.

A noncontrolling interest in a consolidated subsidiary is defined as the portion of the equity (net assets) in a subsidiary not attributable, directly or indirectly, to ~~a parent~~us. Noncontrolling interests are required to be presented as a separate component of equity in the consolidated balance sheet and the presentation of net income ~~was~~is modified to present earnings and other comprehensive income attributed to controlling and noncontrolling interests.

We assess the accounting treatment for each joint venture and debt and preferred equity investment. This assessment includes a review of each joint venture or limited liability company agreement to determine which party has what rights and whether those rights are protective or participating. For all VIE’s, we review such agreements in order to determine which party has the power to direct the activities that most significantly impact the entity’s economic performance. In situations where we and our partner approves, among other things, the annual budget, receives a detailed monthly reporting package from us, meets on a quarterly basis to review the results of the joint venture, reviews and approves the joint venture’s tax return before filing, and approves all leases that cover more than a nominal amount of space relative to the total rentable space at each property, we do not consolidate the joint venture as we consider these to be substantive participation rights that result in shared power of the activities that most significantly impact the performance of our joint venture. Our joint venture agreements typically contain 21

Table of Contents

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

Notes to Consolidated Financial Statements (cont.)

September 30, ~~2013~~2015

(unaudited)

We assess the accounting treatment for each joint venture and debt and preferred equity investment. This assessment includes a review of each joint venture or limited liability company agreement to determine which party has what rights and whether those rights are protective or participating. For all VIEs, we review such agreements in order to determine which party has the power to direct the activities that most significantly impact the entity's economic performance. In situations where we and our partner approve, among other things, the annual budget, receive a detailed monthly reporting package, meet on a quarterly basis to review the results of the joint venture, review and approve the joint venture's tax return before filing, and approve all leases that cover more than a nominal amount of space relative to the total rentable space at each property, we do not consolidate the joint venture as we consider these to be substantive participation rights that result in shared power of the activities that most significantly impact the performance of the joint venture. Our joint venture agreements typically contain certain protective rights such as the requirement of partner approval to sell, finance or refinance the property and the payment of capital expenditures and operating expenditures outside of the approved budget or operating plan.

Investment in Commercial Real Estate Properties

On a periodic basis, we assess whether there are any indications that the value of our real estate properties may be other than temporarily impaired or that their carrying value may not be recoverable. A property’'s value is considered impaired if management’'s estimate of the aggregate future cash flows (undiscounted and without interest charges for consolidated properties) to be generated by the property is less than the carrying value of the property. To the extent impairment has occurred, the loss will be measured as the excess of the carrying amount of the property over the calculated fair value of the property. We also evaluate our real estate properties for potential impairment when a real estate property has been classified as held for sale. Real estate assets held for sale are valued at the lower of either their carrying value or fair value less costs to sell. In ~~June~~During ~~2013~~the three months ended September 30, 2015, we recorded a $219.2 million ~~impairment~~ charge in connection with the expected sale of ~~300~~two ~~Main~~of ~~Street~~our properties. This charge is included in ~~Stamford~~depreciable real estate reserves in the consolidated statements of operations. Prior to the quarter ended September 30, ~~Connecticut~~2015, we do not believe that there were any indicators of impairment at these two properties. See Note 4, "Properties Held for Sale and Property Dispositions." Except as noted above, we do not believe that there were any indicators of impairment at any of our consolidated properties at September 30, 2015.

We ~~assess~~allocate ~~our~~the ~~investments~~purchase price of real estate to land and building (inclusive of tenant improvements) and, if determined to be material, intangibles, such as the value of above- and below-market leases and origination costs associated with the in-place ~~unconsolidated~~leases. ~~joint~~We ~~ventures~~depreciate ~~for~~the ~~recoverability~~amount allocated to building (inclusive of tenant improvements) over their estimated useful lives, which generally range from three to 40 years. We amortize the amount allocated to the above- and ifbelow-market leases over the remaining term of the associated lease, which generally range from one to 14 years, and record it isas ~~determined~~either ~~that~~an increase (in the case of below-market leases) or a ~~loss~~decrease (in ~~value~~the case of above-market leases) to rental income. We amortize the ~~investment~~amount isallocated ~~other~~to ~~than~~the ~~temporary~~values associated with in-place leases over the expected term of the associated lease, wewhich ~~write~~generally ~~down~~ranges from one to 14 years. If a tenant vacates its space prior to the ~~investment~~contractual termination of the lease and no rental payments are being made on the lease, any unamortized balance of the related intangible will be written off. The tenant improvements and origination costs are amortized as an expense over the remaining life of the lease (or charged against earnings if the lease is terminated prior to its ~~fair~~contractual ~~value~~expiration date). We ~~evaluate~~assess ~~our~~fair ~~equity~~value ~~investments~~of ~~for~~the ~~impairment~~leases based on ~~the~~estimated ~~joint~~cash ~~venture’s~~flow ~~projected~~projections ~~discounted~~that utilize appropriate discount and capitalization rates and available market information. Estimates of future cash flows. Weare dobased ~~not~~on ~~believe~~a number of factors including the historical operating results, known trends, and market/economic conditions that may affect the ~~values~~property. ofTo ~~any~~the ofextent ~~our~~acquired ~~consolidated~~leases ~~properties~~contain orfixed ~~equity~~rate ~~investments~~renewal ~~were~~options ~~impaired~~that atare ~~either~~below-market ~~September 30,~~and ~~2013~~determined orto ~~December 31~~be material, ~~2012~~we amortize such below-market lease value into rental income over the renewal period.

~~When~~We werecognized ~~acquire~~$10.2 ~~equity~~million, ~~interests~~$32.9 inmillion, an$5.7 ~~existing~~million ~~unconsolidated~~and ~~joint~~$18.2 ~~venture~~million ~~and~~of ~~gain~~rental ~~control~~revenue ~~over~~for the ~~investment,~~three weand ~~record~~nine ~~the~~months ~~consolidated~~ended ~~investment~~September at30, ~~fair~~2015 ~~value.~~and ~~The~~2014, ~~difference~~respectively, ~~between~~for the ~~book~~amortization ~~value~~ of ~~our~~aggregate ~~equity~~below-market ~~investment~~leases onin ~~the~~excess ~~purchase~~of ~~date~~above-market leases and ~~our~~a ~~share~~reduction ofin ~~the~~lease ~~fair~~origination ~~value~~costs, ofresulting from the ~~investment’s~~allocation ~~purchase~~of ~~price~~the ~~is recorded as a~~ purchase price ~~fair~~of ~~value~~the ~~adjustment~~applicable inproperties. ~~our~~We ~~consolidated~~recognized ~~statements~~as ofa ~~income.~~reduction Into ~~April~~interest ~~2013,~~expense wethe ~~recognized~~amortization aof ~~purchase~~the ~~price~~above-market ~~fair~~rate ~~value~~mortgages ~~adjustment~~assumed of $(20.3)6 million, in$1.7 ~~connection~~million, ~~with~~$1.3 ~~the~~million ~~consolidation~~and of$4.1 16million ~~Court~~for ~~Street,~~the ~~which~~three ~~was~~and ~~previously~~nine ~~accounted~~months ~~for~~ended asSeptember an30, ~~investment~~2015 inand ~~unconsolidated~~2014, ~~joint venture~~respectively.

WeThe ~~allocate~~following ~~the~~summarizes ~~purchase~~our ~~price~~identified ofintangible ~~real~~assets ~~estate to land and building~~ (~~inclusive~~acquired ~~of tenant improvements) and, if determined to be material, intangibles, such as the value of~~ above- ~~and below-~~market leases and ~~origination costs associated with the~~ in-place leases~~. We depreciate the amount allocated to building (inclusive of tenant improvements~~) and ~~other~~ intangible ~~assets~~liabilities over their estimated useful lives, which generally range from three to 40 years and from one to 14 years, respectively. The values of the above- and below-market leases are amortized and recorded as either an increase (inacquired ~~the case of~~ below-market leases) oras ~~a decrease (in the case~~ of ~~above-market leases) to rental income over the remaining term of the associated lease~~September 30, ~~which~~2015 generally range from one to 14 years. The value associated with in-place leases is amortized over the expected term of the associated lease, which generally ranges from one to 14 years. If a tenant vacates its space prior to the contractual termination of the lease and December ~~no rental payments are being made on the lease~~31, ~~any~~2014 ~~unamortized balance of the related intangible will be written off. The tenant improvements and origination costs are amortized as an expense over the remaining life of the lease~~ (orin ~~charged against earnings if the lease is terminated prior to its contractual expiration date~~thousands). We assess fair value of the leases based on estimated cash flow projections that utilize appropriate discount and capitalization rates and available market information. Estimates of future cash flows are based on a number of factors including the historical operating results, known trends, and market/economic conditions that may affect the property. To the extent acquired leases contain fixed rate renewal options that are below market and determined to be material, we amortize such below market lease value into rental income over the renewal period.:

We recognized a decrease approximately $1.5 million in rental revenue for the three months ended September 30, 2013 for the amortization of aggregate above-market leases and reductions in lease origination costs in excess of below-market leases, which included approximately $6.8 million resulting from a write-off of above-market and in-place lease balances associated with a former tenant. Excluding this non-recurring charge, we recognized an increase of approximately $5.3 million in rental revenue for the three months ended September 30, 2013 for the amortization of aggregate below-market leases in excess of above-market leases and reductions in lease origination costs. We recognized an increase of approximately $8.5 million, $2.6 million and $7.4 million in rental revenue for the nine months ended September 30, 2013 and the three and nine months ended September 30, 2012, respectively, for the amortization of aggregate below-market leases in excess of above-market leases and reductions in lease origination costs.We recognized a reduction in interest expense for the amortization of the above-market rate mortgages assumed of approximately $1.3 million, $4.0 million, $1.3 million and $0.7 million for the three and nine months ended September 30, 2013 and 2012, respectively.22

Table of Contents

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

Notes to Consolidated Financial Statements (cont.)

September 30, ~~2013~~2015

(unaudited)

The following summarizes our identified intangible assets (acquired above-market leases and in-place leases) and intangible liabilities (acquired below-market leases) as of September 30, 2013 and December 31, 2012 (in thousands):



	September 30, 2015			December 31, 2014
Identified intangible assets (included in other assets):
Gross amount	$	939,518		$	664,297
Accumulated amortization	(392,854		)	(383,236		)
Net⁽¹⁾	$	546,664		$	281,061
Identified intangible liabilities (included in deferred revenue):
Gross amount	$	866,561		$	655,755
Accumulated amortization	(476,272		)	(483,948		)
Net⁽¹⁾	$	390,289		$	171,807

	September 30, 2013			December 31, 2012
Identified intangible assets (included in other assets):
Gross amount	$	732,160		$	725,861
Accumulated amortization	(325,224		)	(263,107		)
Net	$	406,936		$	462,754
Identified intangible liabilities (included in deferred revenue):
Gross amount	$	667,495		$	651,921
Accumulated amortization	(411,814		)	(357,225		)
Net	$	255,681		$	294,696

____________________________________________________________________


(1)	As of September 30, 2015, $0.2 million and $0.1 million of net intangible assets and net intangible liabilities, respectively, were reclassed to assets held for sale and liabilities related to assets held for sale.

Fair Value Measurements

See Note 17, "Fair Value Measurements."

Investment in Marketable Securities

We ~~invest in marketable securities. At the time of purchase, we are required to~~ designate a security as held-to-maturity, available-for-sale, or trading ~~depending~~at onacquisition. ~~ability~~As ~~and~~of ~~intent.~~September 30, We2015, we do not have any securities designated as held-to-maturity or trading. atWe ~~this~~account ~~time.~~for ~~Securities~~our available-for-sale ~~are~~securities ~~reported~~ at fair value pursuant to Accounting Standards Codification, or ASC, 820-10, with the net unrealized gains or losses reported as a component of accumulated other comprehensive income or loss. Any unrealized losses that are determined to be other-than-temporary are recognized in earnings up to their credit component.

The cost of bonds and marketable securities sold ~~was~~is determined using the specific identification method.

At September 30, ~~2013~~2015 and December 31, ~~2012~~2014, we held the following marketable securities (in thousands):

	September 30, 2013		December 31, 2012
	September 30, 2015		December 31, 2014
Level 1 – Equity marketable securities	$	3,109	$	2,202
Equity marketable securities	$	4,115	$	4,332
Level 2 – Commercial mortgage-backed securities	26,346		15,575
Mortgage-backed securities	42,317		35,097
Level 3 – Rake bonds	3,408		3,652
Total marketable securities available-for-sale	$	46,432	$	39,429
Total marketable securities available-for-sale	$	32,863	$	21,429

~~Our~~The ~~equity~~cost ~~marketable~~basis ~~securities~~of ~~represent~~the ~~our~~commercial ~~investment~~mortgage-backed insecurities ~~Gramercy~~was ~~Capital Corp~~$39.,7 ~~which~~million ~~was~~and ~~renamed Gramercy Property Trust Inc~~$32.4 ~~(NYSE:~~million ~~GPT),~~at ~~or Gramercy~~September 30, in2015 ~~April 2013. Marc Holliday~~and December 31, ~~our chief executive officer~~2014, ~~remains a board member of Gramercy~~respectively. AsThese wesecurities nomature ~~longer~~at ~~have~~various ~~any~~times ~~significant~~through ~~influence over Gramercy, we account for our investment as available-for-sale securities~~2049.

~~The~~During ~~cost basis of~~ the ~~Level~~nine 3months ~~securities~~ended ~~was $3.6 million and $3.7 million at~~ September 30, ~~2013~~2015 and ~~December 31~~2014, ~~2012,~~we ~~respectively.~~disposed ~~There were no sales~~ of ~~Level~~marketable 3 securities ~~during~~for ~~the~~aggregate ~~three~~net ~~and~~proceeds ~~nine~~of ~~months ended September 30, 2013~~$0.4 ~~The~~million ~~Level~~and $3.7 ~~securities~~million, ~~mature at various times through 2030~~respectively.

Investments in Unconsolidated Joint Ventures

We assess our investments in unconsolidated joint ventures for recoverability, and if it is determined that a loss in value of the investment is other than temporary, we write down the investment to its fair value. We evaluate our equity investments for impairment based on the joint venture's projected discounted cash flows. We do not believe that the values of any of our equity investments were impaired at September 30, 2015.

We may originate loans for real estate acquisition, development and construction, where we expect to receive some of the residual profit from such projects. When the risk and rewards of these arrangements are essentially the same as an investor or joint venture partner, we account for these arrangements as real estate investments under the equity method of accounting for investments. Otherwise, we account for these arrangements consistent with our loan accounting for our debt and preferred equity investments.

Revenue Recognition

Rental revenue is recognized on a straight-line basis over the term of the lease. Rental revenue recognition commences when the tenant takes possession or controls the physical use of the leased space. In order for the tenant to take possession, the leased space must be substantially ready for its intended use. To determine whether the leased space is substantially ready for its intended use, management evaluates whether we are or the tenant is the owner of tenant improvements for accounting purposes. When management concludes that we are the owner of tenant improvements, rental revenue recognition begins when the tenant takes possession of the finished space, which is when such tenant improvements are substantially complete. In certain instances, when management concludes that we are not the owner (the tenant is the owner) of tenant improvements, rental revenue recognition begins when the tenant takes possession of or controls the space. When management concludes that we are the

1423

Table of Contents

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

Notes to Consolidated Financial Statements (cont.)

September 30, ~~2013~~2015

(unaudited)

possession of the finished space, which is when such tenant improvements are substantially complete. In certain instances, when management concludes that we are not the owner (the tenant is the owner) of tenant improvements, rental revenue recognition begins when the tenant takes possession of or controls the space. When management concludes that we are the owner of tenant improvements for accounting purposes, ~~management~~we ~~records~~record amounts funded to construct the tenant improvements as a capital asset. For these tenant improvements, ~~management~~we ~~records~~record amounts reimbursed by tenants as a reduction of the capital asset. When management concludes that the tenant is the owner of tenant improvements for accounting purposes, ~~management~~we ~~records~~record our contribution towards those improvements as a lease incentive, which is included in deferred ~~leasing~~ costs, net on our consolidated balance sheets and amortized as a reduction to rental revenue on a straight-line basis over the term of the lease. The excess of rents recognized over amounts contractually due pursuant to the underlying leases are included in deferred rents receivable on the ~~accompanying~~ consolidated balance sheets. We establish, on a current basis, an allowance for future potential tenant credit losses, which may occur against this account. The balance reflected on the consolidated balance sheets is net of such allowance.

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

We record a gain on sale of real estate when title is conveyed to the buyer, subject to the buyer’'s financial commitment being sufficient to provide economic substance to the sale and we have no substantial economic involvement with the buyer.

Interest income on debt and preferred equity investments is ~~recognized~~accrued ~~over~~based on the ~~life~~outstanding principal amount and contractual terms of the ~~investment~~instruments ~~using~~and when, in the ~~effective~~opinion ~~interest~~of ~~method~~management, ~~and~~it ~~recognized~~is ondeemed collectible. Several of the ~~accrual~~debt ~~basis. Fees~~and ~~received~~preferred inequity ~~connection~~investments ~~with~~provide ~~loan~~for ~~commitments~~accrual ~~are~~of ~~deferred~~interest ~~until~~at ~~the~~specified ~~loan~~rates, iswhich ~~funded~~differ ~~and~~from ~~are~~current ~~then~~payment terms. Interest is recognized ~~over~~on ~~the~~such ~~term~~loans ofat the ~~loan~~accrual asrate ansubject ~~adjustment~~ to ~~yield. Anticipated~~management's ~~exit~~determination ~~fees,~~that ~~whose~~accrued ~~collection~~interest is ~~expected~~ultimately collectible, ~~are~~based ~~also~~on ~~recognized~~the ~~over~~underlying ~~the~~collateral ~~term~~and operations of the ~~loan~~borrower. asIf anmanagement ~~adjustment~~cannot tomake ~~yield. Fees~~this ondetermination, ~~commitments~~interest ~~that~~income ~~expire~~above ~~unused~~the ~~are~~current pay rate is recognized atonly ~~expiration~~upon actual receipt.

~~Income~~Deferred ~~recognition~~origination isfees, ~~generally~~original ~~suspended~~issue ~~for~~discounts ~~debt~~ and ~~preferred~~loan ~~equity~~origination ~~investments~~costs, atif any, are recognized as a reduction to the ~~earlier~~interest ofincome over the ~~date~~terms atof ~~which~~the ~~payments~~related ~~become~~investments 90using ~~days~~the ~~past~~effective ~~due~~interest ormethod. ~~when,~~Fees received in ~~the~~connection ~~opinion~~with ofloan ~~management,~~commitments aare ~~full~~also ~~recovery~~deferred ofuntil ~~interest~~the ~~income~~loan ~~and~~is ~~principal~~funded ~~becomes~~and ~~doubtful. Interest~~are ~~income~~then ~~recognition~~recognized isover ~~resumed~~the ~~when~~term of the loan ~~becomes~~as ~~contractually~~an ~~current~~adjustment ~~and~~to ~~performance~~yield. isDiscounts ~~demonstrated~~or topremiums beassociated ~~resumed.~~with ~~Interest~~the ispurchase ~~recorded~~of asloans are amortized or accreted into interest income onas ~~impaired~~a ~~loans~~yield ~~only~~adjustment toon the ~~extent~~effective ~~cash~~interest ismethod ~~received.~~based ~~Several~~on expected cashflows through the expected maturity date of the related investment. If we purchase a debt ~~and~~or preferred equity ~~investments~~investment ~~provide~~at ~~for~~a ~~accrual~~discount, ofintend ~~interest~~to athold ~~specified~~it ~~rates,~~until ~~which~~maturity ~~differ~~and ~~from~~expect ~~current~~to ~~payment~~recover ~~terms.~~the ~~Interest~~full isvalue ~~recognized~~of onthe ~~such~~investment, ~~loans~~we ataccrete the ~~accrual~~discount ~~rate~~into ~~subject~~income as an adjustment to ~~management’s~~yield ~~determination~~over ~~that~~the ~~accrued~~term ~~interest~~of ~~and~~the ~~outstanding~~investment. ~~principal~~If ~~are~~we ~~ultimately~~purchase ~~collectible,~~a ~~based~~debt onor preferred equity investment at a discount with the ~~underlying~~intention of foreclosing on the collateral, ~~and~~we ~~operations~~do ofnot accrete the ~~borrower~~discount. IfFor ~~management~~debt ~~cannot~~investments ~~make~~acquired ~~this~~at ~~determination~~a discount for credit quality, ~~interest~~the ~~income~~difference ~~above~~between contractual cash flows and expected cash flows at acquisition is not accreted. Anticipated exit fees, the ~~current~~collection ~~pay~~of ~~rate~~which is expected, are also recognized ~~only~~over ~~upon~~the ~~actual~~term ~~receipt~~of the loan as an adjustment to yield.

IfDebt weand ~~purchase~~preferred aequity ~~debt~~investments orare ~~preferred~~placed ~~equity~~on ~~investment~~a non-accrual status at athe ~~discount,~~earlier ~~intend~~of tothe ~~hold~~date itat ~~until~~which ~~maturity~~payments ~~and~~become ~~expect~~90 todays ~~recover~~past ~~the~~due ~~full~~or ~~value~~when, ofin the ~~investment~~opinion of management, wea ~~accrete~~full ~~the~~recovery ~~discount~~of ~~into~~interest income asbecomes andoubtful. ~~adjustment~~Interest toincome ~~yield~~recognition ~~over~~on ~~the~~any ~~term~~non-accrual ofdebt ~~the~~or preferred equity investment. Ifis weresumed ~~purchase~~when asuch non-accrual debt or preferred equity investment atbecomes acontractually ~~discount~~current ~~with~~and ~~the~~performance ~~intention~~is ofdemonstrated ~~foreclosing~~to onbe ~~the~~resumed. ~~collateral,~~Interest weis dorecorded ~~not~~as ~~accrete~~income on impaired loans only to the ~~discount~~extent cash is received.

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

The expense for possible credit losses in connection with debt and preferred equity investments is the charge to earnings to increase the allowance for possible credit losses to the level that we estimate to be adequate, based on Level 3 data, considering delinquencies, loss experience and collateral quality. Other factors considered relate to geographic trends and product diversification, the size of the portfolio and current economic conditions. Based upon these factors, we establish the provision for possible credit losses on each individual investment. When it is probable that we will be unable to collect all amounts contractually due, the investment is considered impaired.24

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

Notes to Consolidated Financial Statements (cont.)

September 30, ~~2013~~2015

(unaudited)

~~Where~~investment ~~impairment~~income ~~is indicated~~ on ~~an investment that is held to maturity, a valuation allowance is measured based upon~~ the ~~excess~~consolidated ofstatement ~~the recorded investment amount over the net fair value~~ of ~~the collateral~~income. Any ~~deficiency~~fees ~~between~~received ~~the~~at ~~carrying amount of an asset and~~ the ~~calculated~~time ~~value~~ of ~~the~~sale ~~collateral is charged to expense. The write-off of the reserve balance is called a charge off. We continue to assess~~ or ~~adjust~~syndication ~~our~~are ~~estimates~~recognized ~~based~~as onpart ~~circumstances~~ of ~~a loan and the underlying collateral. If the additional information obtained reflects increased recovery of our~~ investment, ~~we will adjust our reserves accordingly~~income.

WeAsset ~~recorded~~management nofees ~~loan~~are ~~loss~~recognized ~~reserves during the three and nine months ended September 30, 2013. During the three and nine months ended September 30, 2012, we recorded loan loss reserves of zero and $3.0 million, respectively,~~ on ~~investments~~a ~~being~~straight-line ~~held~~basis toover ~~maturity and approximately zero and $2.4 million, respectively, in recoveries in connection with~~ the ~~sale~~term of ~~our investments. This is included in loan loss and other investment reserves, net of recoveries in~~ the ~~accompanying~~asset ~~consolidated~~management ~~statements of income~~agreement.

Reserve for Possible Credit Losses

Where impairment is indicated on an investment that is held to maturity, a valuation allowance is measured based upon the excess of the recorded investment amount over the net fair value of the collateral. Any deficiency between the carrying amount of an asset and the calculated value of the collateral is charged to expense. We continue to assess or adjust our estimates based on circumstances of a loan and the underlying collateral. If the additional information obtained reflects increased recovery of our investment, we will adjust our reserves accordingly. There were no loan reserves recorded during three and nine months ended September 30, 2015 and 2014.

Debt and preferred equity investments held for sale are carried at the lower of cost or fair market value using available market information obtained through consultation with dealers or other originators of such investments as well as discounted cash flow models based on Level 3 data pursuant to ASC 820-10. As circumstances change, management may conclude not to sell an investment designated as held for sale. In such situations, the investment will be reclassified at its net carrying value to debt and preferred equity investments held to maturity. For these reclassified investments, the difference between the current carrying value and the expected cash to be collected at maturity will be accreted into income over the remaining term of the investment.

Income Taxes

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

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

Pursuant to amendments to the Code that became effective January 1, 2001, we have elected, and may elect in the future, to treat certain of our existing or newly created corporate subsidiaries as taxable REIT subsidiaries, or ~~a TRS~~TRSs. In general, ~~our~~ TRSs may perform non-customary services for ~~our~~the tenants of the Company, hold assets that we cannot hold directly and generally may engage in any real estate or non-real estate related business. ~~Our~~ The TRSs generate income, resulting in Federal and state income tax liability for these entities.

During the three and nine months ended September 30, ~~2013~~2015 and 2014, we recorded Federal, state and local tax provisions of $21.1 million, ~~and~~ $62.05 million, ~~respectively~~$1.6 ~~During~~million ~~the three~~ and ~~nine months ended September 30, 2012, we recorded Federal, state and local tax provisions of zero and less than~~ $06.16 million, respectively.

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

Stock-Based Employee Compensation Plans

We have a stock-based employee compensation plan, described more fully in Note 14, “"Share-based Compensation.”"

1625

Table of Contents

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

Notes to Consolidated Financial Statements (cont.)

September 30, ~~2013~~2015

(unaudited)

~~Our~~The Company's stock options are recorded at fair value at the time of issuance. Fair value of the stock options is determined using the Black-Scholes option- pricing model. The Black-Scholes model was developed for use in estimating the fair value of traded options, which have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions including the expected stock price volatility. Because our plan has characteristics significantly different from those of traded options and because changes in the subjective input assumptions can materially affect the fair value estimate, in our opinion, the existing models do not necessarily provide a reliable single measure of the fair value of ~~our~~the employee stock options.

Compensation cost for stock options, if any, is recognized ~~ratably~~ over the vesting period of the award. Our policy is to grant options with an exercise price equal to the quoted closing market price of ~~our~~the Company's common stock on the grant date. Awards of stock or restricted stock are expensed as compensation over the benefit period based on the fair value of the stock on the grant date.

For share-based awards with a performance or market measure, we recognize compensation cost over the requisite service period, using the accelerated attribution expense method. The requisite service period begins on the date the compensation committee of ~~our~~SL Green's board of directors authorizes the award, adopts any relevant performance measures and communicates the award to the employees. For programs with awards that vest based on the achievement of a performance ~~measures~~condition or market condition, we determine whether it is probable that the ~~total~~performance ~~estimated~~condition will be met, and estimate compensation cost is based on the fair value of the award at the applicable reporting date estimated using a binomial model or market quotes. For share-based awards for which there is no pre-established performance measure, we recognize compensation cost over the service vesting period, which represents the requisite service period, on a straight-line basis. In accordance with the provisions of our share-based incentive compensation plans, we accept the return of shares of the Company's common stock, at the current quoted market price, from certain key employees to satisfy minimum statutory tax-withholding requirements related to shares that vested during the period.

Awards can also be made in the form of a separate series of units of limited partnership interest in the Operating Partnership called long-term incentive plan units, or LTIP ~~Units~~units. LTIP ~~Units~~units, which can be granted either as free-standing awards or in tandem with other awards under our stock incentive plan, are valued by reference to the value of the Company's common stock at the time of grant, and are subject to such conditions and restrictions as the compensation committee of the Company's board of directors may determine, including continued employment or service, computation of financial metrics and/or achievement of pre-established performance goals and objectives.

Earnings per Share of the Company

The Company presents both basic and diluted earnings per share, or EPS. Basic EPS excludes dilution and is computed by dividing net income or loss attributable to common stockholders by the weighted average number of common ~~stock~~shares outstanding during the period. Basic EPS includes participating securities, consisting of unvested restricted stock that receive nonforfeitable dividends similar to shares of common stock. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock, where such exercise or conversion would result in a lower EPS amount. Diluted EPS also includes units of limited partnership interest. The dilutive effect of stock options is reflected in the weighted average diluted outstanding shares calculation by application of the treasury stock method. There is no dilutive effect for the exchangeable senior ~~debentures~~notes as the conversion premium will be paid in cash.

Earnings per Unit of the Operating Partnership

The Operating Partnership presents both basic and diluted earnings per unit, or EPU. Basic EPU excludes dilution and is computed by dividing net income or loss attributable to common unitholders by the weighted average number of common units outstanding during the period. Basic EPU includes participating securities, consisting of unvested restricted units that receive nonforfeitable dividends similar to shares of common units. Diluted EPU reflects the potential dilution that could occur if securities or other contracts to issue common units were exercised or converted into common units, where such exercise or conversion would result in a lower EPU amount. The dilutive effect of unit options is reflected in the weighted average diluted outstanding units calculation by application of the treasury stock method. There is no dilutive effect for the exchangeable senior notes as the conversion premium will be paid in cash.

Table of Contents

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

Notes to Consolidated Financial Statements

September 30, 2013

(unaudited)

Use of Estimates

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

Concentrations of Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash investments, debt and preferred equity investments and accounts receivable. We place our cash investments in excess of insured amounts with high quality financial institutions. The collateral securing our debt and preferred equity investments is located in the New York Metropolitan area. See Note 5, “Debt and Preferred Equity Investments.” We perform ongoing credit evaluations of our tenants and require most tenants to provide security deposits or letters of credit. Though these security deposits and letters of credit are insufficient to meet the total value of a tenant’s lease obligation, they are a measure of good faith and a source of funds to offset the economic costs associated with lost rent and the costs associated with re-tenanting the space. Although the properties in our real estate portfolio are primarily located in Manhattan, we also have Suburban properties located in Brooklyn, Long Island, Westchester County, Connecticut, Northern New Jersey and the west coast. The tenants located in our buildings operate in various industries. Other than three tenants who account for approximately 7.3%, 6.5% and 6.0% of our share of annualized cash rent, no other tenant in our portfolio accounted for more than 2.0% of our annualized cash rent, including our share of joint venture annualized cash rent for the three months ended September 30, 2013. Approximately 10%, 7% and 6% of our annualized cash rent for consolidated properties for the three months ended September 30, 2013 was attributable to 1515 Broadway, 1185 Avenue of the Americas and One Madison Avenue, respectively. In addition, one debt and preferred equity investment accounted for more than 10% of the income earned on debt and preferred equity investments during the three months ended September 30, 2013.26

Table of Contents

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

Notes to Consolidated Financial Statements (cont.)

September 30, 2015

(unaudited)

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash investments, debt and preferred equity investments and accounts receivable. We place our cash investments in excess of insured amounts with high quality financial institutions. The collateral securing our debt and preferred equity investments is located in New York City. See Note 5, "Debt and Preferred Equity Investments." We perform ongoing credit evaluations of our tenants and require most tenants to provide security deposits or letters of credit. Though these security deposits and letters of credit are insufficient to meet the total value of a tenant's lease obligation, they are a measure of good faith and a source of funds to offset the economic costs associated with lost rent and the costs associated with re-tenanting a space. Although the properties in our real estate portfolio are primarily located in Manhattan, we also have properties located in Brooklyn, Long Island, Westchester County, Connecticut and New Jersey. The tenants located in our buildings operate in various industries. Other than three tenants who account for 9.8%, 9.2% and 6.3% of our share of annualized cash rent, respectively, no other tenant in our portfolio accounted for more than 5.0% of our share of annualized cash rent, including our share of joint venture annualized rent, at September 30, 2015. For the three months ended September 30, 2015, 9.7%, 8.8%, 7.3% , 7.0%, 6.7%, 5.7%, and 5.4% of our annualized cash rent for consolidated properties was attributable to 1515 Broadway, 388 and 390 Greenwich Street, 919 Third Ave, 1185 Avenue of the Americas, 11 Madison Ave, 420 Lexington Ave, and 1 Madison Ave respectively. Annualized cash rent for all other consolidated properties was below 5.0%.

Reclassification

Certain prior year balances have been reclassified to conform to our current year presentation primarily in order to eliminate discontinued operations from income from continuing operations ~~and to reclassify deferred origination fees from deferred income to debt and preferred equity investments~~.

Accounting Standards Updates

In ~~February 2013~~September 2015, the ~~FASB~~Financial ~~issued~~Accounting ~~guidance~~Standards onBoard, ~~the~~or ~~presentation~~FASB, ~~and~~issued ~~disclosure~~final ofguidance ~~reclassification~~to simplify the measurement-period adjustments ~~out~~in ofbusiness ~~accumulated~~combinations ~~other~~(Accounting ~~comprehensive~~Standards ~~income~~Update, or ~~AOCI~~ASU, No. 2015-62). The ~~standard~~guidance ~~requires~~eliminates the requirement that an ~~entity~~acquirer toin ~~present~~a ~~information~~business ~~about~~combination ~~significant~~account ~~items~~for ~~reclassified~~measurement-period ~~out~~adjustments ofretrospectively. ~~AOCI~~Instead, byacquirers ~~component~~must ~~either~~recognize onmeasurement-period adjustments in the period ~~face~~in ofwhich they determine the ~~statement~~amounts, ~~where~~including ~~net~~the ~~income~~effect ison ~~presented~~earnings orof asany aamounts ~~separate~~they ~~disclosure~~would have recorded in previously periods if the ~~notes~~accounting tohad ~~financial~~been ~~statements.~~completed at the acquisition date. The guidance ~~became~~is effective for ~~calendar~~fiscal ~~year-end~~years ~~public~~beginning ~~companies~~after ~~beginning~~December in15, ~~the~~2015, ~~first~~and ~~quarter~~interim ofperiods ~~2013~~within ~~and~~those ~~its~~fiscal years. Early adoption ~~did~~of ~~not~~the ~~have~~guidance ais ~~material~~permitted. ~~impact~~The onCompany ~~our~~adopted ~~consolidated~~the ~~financial~~guidance ~~statements~~during the third quarter of 2015.

3In April 2015, the FASB issued final guidance to simplify the presentation of debt issuance costs by requiring debt issuance costs to be presented as a deduction from the corresponding debt liability (ASU No. ~~Property~~ ~~Acquisitions~~2015-03). The guidance requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability. The guidance is effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption of the guidance is permitted. Upon adoption, an entity must apply the new guidance retrospectively for all prior periods presented in the financial statements. The Company expects to adopt the guidance effective January 1, 2016 and the guidance is not anticipated to have a material impact on our consolidated financial statements.

In ~~April 2013~~February 2015, wethe ~~acquired~~FASB ~~interests~~issued ~~from~~new ~~our~~guidance ~~joint~~that ~~venture~~amends ~~partner,~~the ~~City~~current ~~Investment~~consolidation ~~Fund~~guidance, orincluding ~~CIF,~~introducing ina 16separate ~~Court~~consolidation ~~Street~~analysis ~~for~~specific ~~$4.0~~to ~~million.~~limited Wepartnerships ~~have~~and ~~consolidated~~other ~~the~~similar ~~ownership~~entities of(ASU ~~the~~No. ~~318,000 square foot building~~2015-02). Under ~~The~~this ~~transaction~~analysis, ~~valued~~limited ~~the~~partnerships ~~consolidated~~and ~~interest~~other atsimilar ~~$96.2~~entities ~~million,~~will ~~inclusive~~be ofconsidered ~~the~~a ~~$84.7~~VIE ~~million~~unless ~~mortgage encumbering~~ the ~~property.~~limited Wepartners ~~recognized~~hold asubstantive ~~purchase~~kick-out ~~price~~rights ~~fair~~or ~~value~~participating ~~adjustment of $(2~~rights.3) ~~million~~The ~~upon~~guidance ~~the~~is ~~closing~~effective offor ~~this~~annual ~~transaction.~~and ~~This~~interim ~~property,~~periods ~~which~~beginning weafter ~~initially~~December ~~acquired in July 2007~~15, ~~was~~2015. Early ~~previously~~adoption ~~accounted~~of ~~for~~this asguidance anis ~~investment in unconsolidated joint ventures~~permitted. WeThe ~~are~~Company is currently inevaluating the ~~process~~new ofguidance ~~analyzing~~to determine the ~~purchase~~impact ~~price~~it ~~allocation~~may ~~and, as such, we~~ have ~~not~~on ~~allocated any~~our ~~value~~consolidated tofinancial ~~intangible assets such as above- and below-market lease or in-place leases~~statements.

In ~~March 2013,~~June we2014, ~~along~~the ~~with~~FASB ~~Magnum~~issued ~~Real~~final ~~Estate~~guidance ~~Group,~~that ~~acquired~~requires 84repurchase-to-maturity ~~residential~~transactions ~~apartment~~to ~~units,~~be ~~consisting~~accounted offor 72as ~~apartment~~secured ~~units~~borrowings ~~and~~as 12if ~~townhouses~~the transferor retains effective control, ~~located~~even though the transferred financial assets are not returned to the transferor at ~~248-252~~settlement ~~Bedford~~and ~~Avenue,~~also ~~Williamsburg,~~eliminates ~~Brooklyn~~existing guidance for ~~$54~~repurchase financings (ASU No.9 ~~million~~2014-11). ~~Simultaneous~~New ~~with~~disclosures are required for (1) certain transactions accounted for as secured borrowings and (2) transfers accounted for as sales when the ~~closing,~~transferor also retains substantially all of the ~~joint~~exposure ~~venture~~to ~~closed~~the economic return on athe ~~five-year~~transferred ~~$22~~financial assets throughout the term of the transaction.0 ~~million~~The ~~mortgage~~guidance ~~loan~~was effective for the first interim or annual period beginning after December 15, 2014, except for the disclosures related to transactions accounted for as secured borrowings, which ~~carries~~are aeffective ~~floating~~for ~~rate~~periods ofbeginning ~~interest~~after March 15, 2015. Early adoption of ~~225~~this ~~basis~~guidance ~~points~~is ~~over~~prohibited. ~~LIBOR~~The Company adopted the standard beginning in the first quarter of 2015. The ~~property~~adoption isof ~~above~~this guidance did not have a ~~commercial~~material ~~property~~impact ~~already~~on ~~owned~~our byconsolidated usfinancial statements. WeThe ~~hold~~Company ahas ~~90%~~adopted ~~controlling~~the ~~interest~~presentation inand ~~this~~disclosures ~~joint~~related ~~venture~~to transactions accounted for as secured borrowings during the second quarter of 2015.

18In May 2014, the FASB issued a new comprehensive revenue recognition guidance which requires us to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods and services (ASU No. 2014-09). The guidance also requires enhanced disclosures to

Table of Contents

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

Notes to Consolidated Financial Statements (cont.)

September 30, ~~2013~~2015

(unaudited)

~~The~~help ~~following~~users ~~summarizes~~of ~~our~~financial ~~allocation~~statements ofbetter understand the ~~purchase~~nature, ~~price~~amount, timing, and uncertainty of revenue that is recognized. The guidance is effective for annual and interim periods beginning after December 15, 2016 and early adoption is not permitted. In July 2015, the ~~assets~~FASB ~~acquired~~voted to defer by one year the effective date of ASU 2014-09 for both public and ~~liabilities~~nonpublic ~~assumed~~entities ~~upon~~and give both public and private companies the ~~closing~~option to early adopt using the original effective date. The new guidance can be applied either retrospectively to each prior reporting period presented, or as a cumulative-effect adjustment as of ~~this~~the ~~acquisition~~date ~~(in~~of ~~thousands):~~adoption. The Company is currently evaluating the new guidance to determine the impact it may have on our consolidated financial statements.

	248-252BedfordAvenue
Land	$	10,865
Building and building leasehold	44,035
Above market lease value	—
Acquired in-place leases	—
Other assets, net of other liabilities	—
Assets acquired	54,900
Fair value adjustment to mortgage note payable	—
Below market lease value	—
Liabilities assumed	—
Purchase price allocation	$	54,900
Net consideration funded by us at closing, excluding consideration financed by debt	$	21,782
Equity and/or debt investment held	$	—
Debt assumed	$	—

In April 2014, the FASB issued new guidance on reporting discontinued operations which raises the threshold for disposals to qualify as discontinued operations (ASU No. 2014-08). The guidance also allows us to have a significant continuing involvement and continuing cash flows with the discontinued operations. Additionally, the guidance requires additional disclosures for discontinued operations and new disclosures for individually material disposal transactions that do not meet the definition of a discontinued operation. The guidance was effective for calendar year public companies beginning in the first quarter of 2015 and is to be applied on a prospective basis for new disposals. Early adoption of this guidance was permitted. The Company adopted the standard beginning in the first quarter of 2015. The adoption of this guidance will change the presentation of discontinued operations for all properties held for sale and/or disposed of subsequent to January 1, 2015.

43. Property ~~Dispositions~~Acquisitions

In2015 ~~September 2013, we sold the property located at 300 Main Street, Stamford, Connecticut for $13.5 million. We recorded a $2.2 million impairment charge in the second quarter of 2013.~~ Acquisitions

InDuring ~~August 2013, we sold~~ the ~~property~~nine ~~located~~months atended ~~333~~September ~~West 34th~~30, ~~New York~~2015, ~~New~~the ~~York~~properties ~~for~~listed ~~$220.3~~below ~~million.~~were Weacquired ~~recognized~~from athird ~~gain of $13~~parties.8 ~~million on the sale.~~ The ~~$211.0~~following ~~million~~summarizes ~~net~~our ~~proceeds~~preliminary ~~from~~allocation ~~the sale~~ of ~~this~~the ~~property~~purchase ~~are~~price ~~temporarily~~of ~~being~~the ~~held~~assets atacquired aand ~~qualified~~liabilities ~~intermediary,~~assumed atupon ~~our direction, for~~ the ~~purpose~~closing of ~~facilitating~~these aacquisitions ~~Section 1031 Like-Kind Exchange, and, as such, are included~~ (in ~~restricted cash on the consolidated balance sheets at September 30, 2013.~~ thousands):

In February 2013, we, along with our joint venture partner, sold our property located at 44 West 55th Street for $6.3 million. We recognized a gain of $1.1 million on the sale.



	187 Broadway and 5 & 7 Dey Street ⁽¹⁾⁽²⁾		11 Madison Avenue ⁽¹⁾⁽³⁾		110 Greene Street ⁽¹⁾⁽⁴⁾		Upper East Side Residential⁽¹⁾⁽⁵⁾		1640 Flatbush Avenue⁽¹⁾
Acquisition Date	August 2015		August 2015		July 2015		June 2015		March 2015
Ownership Type	Fee Interest		Fee Interest		Fee Interest		Fee Interest		Fee Interest
Property Type	Residential/Retail		Office		Office		Residential/Retail		Retail

Purchase Price Allocation:
Land	$	22,101	$	849,926	$	89,250	$	17,500	$	6,120
Building and building leasehold	41,045		1,579,118		165,750		32,500		680
Above-market lease value	—		—		—		—		—
Acquired in-place leases	—		—		—		—		—
Other assets, net of other liabilities	—		—		—		—		—
Assets acquired	63,146		2,429,044		255,000		50,000		6,800
Mark-to-market assumed debt	—		—		—		—		—
Below-market lease value	—		—		—		—		—
Derivatives	—		—		—		—		—
Liabilities assumed	—		—		—		—		—
Purchase price	$	63,146	$	2,429,044	$	255,000	$	50,000	$	6,800
Net consideration funded by us at closing, excluding consideration financed by debt	$	63,146	$	2,429,044	$	255,000	$	50,000	$	6,800
Equity and/or debt investment held	$	—	$	—	$	—	$	—	$	—
Debt assumed	$	—	$	—	$	—	$	—	$	—

____________________________________________________________________

~~Discontinued~~(1) ~~operations~~We ~~included~~are ~~the~~currently ~~results~~in ofthe ~~operations~~process of ~~real~~analyzing ~~estate~~the ~~assets~~purchase ~~under~~price ~~contract~~allocation ~~or sold prior to September 30~~and, ~~2013.~~as ~~This included 300 Main Street~~such, ~~which~~we ~~was~~have ~~sold~~not inallocated ~~September~~any ~~2013,~~value ~~333~~to ~~West~~intangible ~~34th~~assets ~~Street,~~such ~~which~~as ~~was~~above- ~~sold in August 2013, 44 West 55th Street, which was sold in February 2013~~ and ~~292~~below-market ~~Madison~~lease ~~Avenue,~~or ~~which was sold~~ in-place ~~February 2012~~leases.

19(2) We acquired this property for consideration that included the issuance of $10.0 million and $26.9 million aggregate liquidation preferences of Series R and S Preferred Units, respectively, of limited partnership interest of the Operating Partnership and cash.

Table of Contents

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

Notes to Consolidated Financial Statements (cont.)

September 30, ~~2013~~2015

(unaudited)

~~The~~(3) ~~following~~In ~~table~~August ~~summarizes~~2015, ~~income~~we acquired this property from ~~discontinued~~a ~~operations~~partnership ~~for~~of the ~~three~~Sapir Organization and ~~nine~~CIM ~~months ended September 30~~Group, ~~2013~~with ~~and~~whom ~~2012,~~we ~~respectively~~have ~~(in~~no ~~thousands):~~other relationship.

	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013		2012
Revenues
Rental revenue	$	1,696		$	5,446		$	10,656	$	13,872
Escalation and reimbursement revenues	683			611			1,292		1,778
Other income (loss)	1			(376		)	8		(376		)
Total revenues	2,380			5,681			11,956		15,274
Operating expenses	660			2,065			3,643		4,930
Real estate taxes	187			302			765		916
Interest expense, net of interest income	130			696			461		1,627
Depreciable real estate reserves	—			—			2,150		—
Transaction related costs	(3		)	65			—		160
Depreciation and amortization	—			1,602			3,212		4,758
Total expenses	974			4,730			10,231		12,391
Net income from discontinued operations	$	1,406		$	951		$	1,725	$	2,883


(4)	We acquired a 90.0% controlling interest in this property for consideration that included the issuance of $5.0 million and $6.7 million aggregate liquidation preferences of Series P and Q Preferred Units, respectively, of limited partnership interest of the Operating Partnership and cash.

(5) We, along with our joint venture partner, acquired this property for consideration that included the issuance of $13. ~~Debt~~8 ~~and~~million aggregate liquidation preference of Series N Preferred ~~Equity~~Units ~~Investments~~of limited partnership interest of the Operating Partnership and cash. We hold a 95.1% controlling interest in this joint venture.

~~During~~Pro the nine months ended September 30, 2013 and 2012, our debt and preferred equity investments (net of discounts and deferred origination fees) increased approximately $497.4 million and $374.0 million, respectively, due to originations, purchases, accretion of reserves and discounts and paid-in-kind interest. We recorded repayments, participations and sales of approximately $530.2 million and $288.3 million, respectively, and loan loss reserves of zero and $3.0 million during the nine months ended September 30, 2013 and 2012, respectively, which offset the increases in debt and preferred equity investments.Forma

~~Debt~~The ~~Investments~~following table summarizes, on an unaudited pro forma basis, the results of operations of 11 Madison Avenue, which are included in the consolidated statements of operations, and our consolidated results of operations for the three and nine months ended September 30, 2015 and 2014 as though the acquisition of 11 Madison Avenue was completed on January 1, 2014. The supplemental pro forma data is not necessarily indicative of what the actual results of operations would have been assuming the transactions had been completed as set forth above, nor do they purport to represent our results of operations for future periods.

As of September 30, 2013 and December 31, 2012, we held the following debt investments with an aggregate weighted average current yield of approximately 11.3% at September 30, 2013 (in thousands):



	Three Months Ended September 30,					Nine Months Ended September 30,
(in thousands, except per share amounts)	2015			2014		2015			2014
Actual revenues since acquisition	$	9,051				$	9,051
Actual net income since acquisition	(4,202		)			(4,202		)
Pro forma revenues	432,822			397,684		1,255,507			1,146,697
Pro forma income from continuing operations	25,299			31,197		26,645			350,125
Pro forma basic earnings per share	$	0.18		$	0.59	$	0.11		$	6.39
Pro forma diluted earnings per share	$	0.18		$	0.59	$	0.11		$	6.36
Pro forma basic earnings per unit	$	0.18		$	0.59	$	0.11		$	6.39
Pro forma diluted earnings per unit	$	0.18		$	0.59	$	0.11		$	6.36

20______________________________________________________________________

(1)

The pro forma income from continuing operations for the three and nine months ended September 30, 2015 and 2014 includes the effect of the incremental borrowings, including a $1.4 billion, 10-year, interest only, fixed rate mortgage financing carrying a per annum stated interest rate of 3.838% to complete the acquisition and the preliminary allocation of purchase price. In addition, the pro forma net income for the nine months ended September 30, 2014 was adjusted to include the sale of real estate assets for properties that have closed either subsequent to June 30, 2015 or we are currently under contract to sell, as if the sales were completed on January 1, 2014. The pro forma net income for the three and nine months ended September 30, 2015 excludes these sales.

Table of Contents

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

Notes to Consolidated Financial Statements (cont.)

September 30, ~~2013~~2015

(unaudited)

LoanType	September 30,2013SeniorFinancing		September 30,2013Carrying Value,Net of Discountsand DeferredOrigination Fees			December 31,2012Carrying Value,Net of Discountsand DeferredOrigination Fees			InitialMaturityDate
Other Loan	$	398,500	$	14,837		$	—		March 2015
Mezzanine Loan	205,000		67,740			66,307			February 2016
Mortgage/Mezzanine Loan	167,355		44,549			44,013			May 2016
Mezzanine Loan	177,000		15,226			15,906			May 2016
Junior Participation	133,000		49,000			49,000			June 2016
Mezzanine Loan	165,000		71,254			70,967			November 2016
Mortgage/Mezzanine Loan(1)	1,109,000		78,268			115,804			March 2017
Other Loan	15,000		3,500			3,500			September 2021
Mortgage(2)	—		—			218,068			—
Total fixed rate	$	2,369,855	$	344,374		$	583,565
Mortgage Loan	—		29,912			—			December 2013
Junior Participation(3)	57,750		10,869			10,869			February 2014
Junior Participation(4)	80,932		23,953			—			February 2014
Mortgage/Mezzanine Loan	330,000		131,595			131,231			July 2014
Mezzanine Loan(5)	62,500		37,394			37,288			July 2014
Mezzanine Loan	180,000		59,852			59,739			August 2014
Mortgage	—		14,855			14,745			September 2014
Mezzanine Loan(6)	87,374		37,365			34,444			October 2014
Mortgage/Mezzanine Loan(7)	—		53,258			47,253			February 2015
Mezzanine Loan	110,000		48,991			—			September 2015
Mezzanine Loan(8)	92,711		27,772			55,336			December 2015
Mezzanine Loan	775,000		72,585			—			March 2016
Mezzanine Loan(9)	160,000		22,515			7,624			June 2016
Mezzanine Loan	87,300		25,580			34,761			July 2016
Mortgage/Mezzanine Loan	72,000		20,558			—			July 2018
Total floating rate	$	2,095,567	$	617,054		$	433,290
Total	4,465,422		961,428			1,016,855
Loan loss reserve(10)			(4,000		)	(7,000		)
			$	957,428		$	1,009,855

2014 Acquisitions

~~_________________________________~~During the nine months ended September 30, 2015, we finalized the purchase price allocations based on third party appraisal and additional facts and circumstances that existed at the acquisition dates for the following 2014 acquisitions (in thousands):

(1) Interest is added to the principal balance for this accrual only loan. In January 2013, we sold 50% of the mezzanine loan for $57.8 million and recognized additional income of $12.9 million, which is included in investment and preferred equity income on the consolidated statements of income. The unaccrued interest during the period in which the loan was on non-accrual status is being accreted as of January 2013.



	102 Greene Street⁽¹⁾		635 Madison Avenue⁽¹⁾		719 Seventh Avenue⁽¹⁾⁽²⁾		115 Spring Street⁽¹⁾		388-390 Greenwich Street⁽¹⁾⁽³⁾
Acquisition Date	October 2014		September 2014		July 2014		July 2014		May 2014
Ownership Type	Fee Interest		Fee Interest		Fee Interest		Fee Interest		Fee Interest
Property Type	Retail		Land		Development		Retail		Office

Purchase Price Allocation:
Land	$	8,215	$	205,632	$	41,850	$	11,078	$	516,292
Building and building leasehold	26,717		15,805		—		44,799		964,434
Above-market lease value	—		—		—		—		—
Acquired in-place leases	1,015		17,345		—		2,037		302,430
Other assets, net of other liabilities	3		—		—		—		6,495
Assets acquired	35,950		238,782		41,850		57,914		1,789,651
Mark-to-market assumed debt	—		—		—		—		—
Below-market lease value	3,701		85,036		—		4,789		186,782
Derivatives	—		—		—		—		18,001
Liabilities assumed	3,701		85,036		—		4,789		204,783
Purchase price	$	32,249	$	153,746	$	41,850	$	53,125	$	1,584,868
Net consideration funded by us at closing, excluding consideration financed by debt	$	32,249	$	153,746	$	41,850	$	53,125	$	208,614
Equity and/or debt investment held	$	—	$	—	$	—	$	—	$	148,025
Debt assumed	$	—	$	—	$	—	$	—	$	1,162,379

(2) In connection with the repayment of the loan in May 2013, we recognized additional income of $6.4 million, which is included in investment and preferred equity income on our consolidated statements of income.____________________________________________________________________

(31) InBased ~~June~~on ~~2013,~~our preliminary analysis of the ~~loan~~purchase ~~was~~price, ~~extended~~we had allocated $11.3 million and $21.0 million to ~~February~~land ~~2014~~and building, ~~subject~~respectively, at 102 Greene Street, $153.7 million to anland ~~additional~~at ~~four~~635 Madison Avenue, $14.4 million and $26.7 million to land and building, respectively, at 719 Seventh Avenue, $15.9 million and $37.2 million to land and building, respectively, at 115 Spring Street and $558.7 million and $1.0 billion to land and building, respectively, at 388-~~month~~390 ~~extension~~Greenwich. ~~option~~The impact to our consolidated statement of income for the nine months ended September 30, 2015 was $7.6 million in rental revenue for the amortization of aggregate below-market leases and $10.3 million of depreciation expense.

(42) AsWe, ofalong ~~September~~with ~~30,~~our ~~2013~~joint venture partner, weacquired ~~were~~this ~~committed~~property tofor ~~fund~~consideration anthat ~~additional~~included the issuance of $014.1 million aggregate liquidation preference of Series L Preferred Units of limited partnership interest of the Operating Partnership and $9.5 million inaggregate ~~connection~~liquidation ~~with~~preference of Series K Preferred Units of limited partnership interest of the Operating Partnership. We hold a 75.0% controlling interest in this ~~loan~~joint venture.

(53) AsIn aMay ~~result~~2014, we acquired Ivanhoe Cambridge, Inc.'s 49.65% economic interest in this property, thereby consolidating full ownership of the ~~transfer~~property. ~~not~~The ~~meeting~~transaction valued the ~~conditions~~consolidated ~~for~~interests ~~sale~~at ~~accounting~~$1.585 billion. Simultaneous with the closing, we refinanced the previous mortgage with a $51.45 billion mortgage. We also assumed the existing derivative instruments, which swapped $504.0 million of the mortgage to fixed rate (in October 2014, we entered into multiple swap agreements to hedge our interest rate exposure on an additional $500.0 million portion of ~~the~~this ~~outstanding~~mortgage. ~~loan~~See ~~that~~Note ~~was~~8, ~~participated~~"Mortgages ~~out~~and ~~has~~Other ~~been~~Loans ~~recorded~~Payable" infor ~~other~~further ~~liabilities~~details). We recognized a purchase price fair value adjustment of $71.4 million upon closing of this transaction. This property, which we initially acquired in ~~the~~December ~~accompanying~~2007, ~~consolidated~~was ~~balance~~previously ~~sheets~~accounted for as an investment in unconsolidated joint ventures.

~~(6) As of September~~ 30~~, 2013, we were committed to fund an additional $12.3 million in connection with this loan.~~

(7) As of September 30, 2013, we were committed to fund an additional $5.2 million in connection with this loan.

Table of Contents

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

Notes to Consolidated Financial Statements (cont.)

September 30, ~~2013~~2015

(unaudited)

~~(8)~~For Webusiness ~~funded~~combinations ~~$56.3~~achieved ~~million~~in ~~at origination. In June 2013~~stages, wethe ~~sold~~acquisition-date ~~50%~~fair value of our equity interest in a property immediately before the ~~$85.0~~acquisition ~~million~~date ~~mezzanine~~is ~~loan~~determined based on estimated cash flow projections that utilize available market information and discount and capitalization rates that we deem appropriate. AsEstimates of ~~September~~future ~~30,~~cash ~~2013~~flows are based on a number of factors including historical operating results, weknown ~~were~~and ~~committed~~anticipated totrends, ~~fund~~and anmarket ~~additional~~and ~~$13~~economic conditions.6 ~~million~~The acquisition-date fair value of the equity interest in ~~connection~~388-390 Greenwich Street immediately before the acquisition date as well as the purchase price fair value, as determined in accordance with ~~our~~the ~~share~~methodology ofset ~~this~~out ~~loan.~~in the prior sentence, is as follows (in thousands):

(9) As part of the refinancing of the related senior mortgage in June 2013, we originated a $30.0 million mezzanine loan and our previous investment in the amount of $15.0 million, including the $7.4 million participated interest, was repaid in full. Following the refinancing, we entered into a loan participation agreement in the amount of $7.4 million on this $30.0 million mezzanine loan. Due to our continued involvement with the loan, the portion that was participated out has been recorded in other assets and other liabilities in the accompanying consolidated balance sheets.



	388-390 Greenwich Street
Contract purchase price	$	1,585,000
Net consideration funded by us at closing, excluding consideration financed by debt	(208,614		)
Debt assumed	(1,162,379		)
Fair value of retained equity interest	214,007
Equity and/or debt investment held	(148,025		)
Other⁽¹⁾	5,464
Purchase price fair value adjustment	$	71,446

___________________________________________________________________

(101) ~~Loan~~Includes ~~loss reserves are specifically allocated to investments. Our reserves reflect management's judgment of~~ the ~~probability~~acceleration ~~and severity~~ of ~~losses~~a ~~based~~deferred onleasing ~~Level~~commission 3from ~~data.~~the Wejoint ~~cannot~~venture ~~be certain that our judgment will prove~~ to bethe ~~correct or that reserves will be adequate over time to protect against potential future losses~~Company.

~~Preferred~~4. ~~Equity~~Properties ~~Investments~~Held for Sale and Property Dispositions

AsProperties ofHeld ~~September 30,~~for ~~2013 and December 31, 2012, we held the following preferred equity investments, with an aggregate weighted average current yield of approximately 10.9% at September 30, 2013 (in thousands):~~Sale

Type	September 30,2013 Senior Financing		September 30,2013CarryingValue, Net ofDiscountsand DeferredOriginationFees		December 31,2012CarryingValue, Net ofDiscountsand DeferredOriginationFees		Initial MandatoryRedemption
Preferred equity	$	70,000	$	9,937	$	9,927	October 2014
Preferred equity(1)(2)	525,000		107,723		99,768		July 2015
Preferred equity(1)(3)	55,986		24,426		18,925		April 2016
Preferred equity(1)	926,260		216,037		209,959		July 2016
	$	1,577,246	$	358,123	$	338,579

During the third quarter of 2015, we entered into separate agreements to sell 570-574 Fifth Avenue for $125.4 million and 140-150 Grand Street in White Plains, New York for $32.0 million. During the quarter, we recorded a $19.2 million charge in connection with the expected sale of 140-150 Grand Street. These charges are included in depreciable real estate reserves in the consolidated statements of operations. See Note 2, "Significant Account Policies - Investments in Commercial Real Estate Properties" for further discussion.

~~_________________________________~~ Property Disposition

~~(1)~~ The ~~difference~~following ~~between~~table summarizes the ~~pay~~properties ~~and~~sold ~~accrual~~during ~~rates~~the isnine ~~included~~months asended anSeptember ~~addition~~30, ~~to the principal balance outstanding.~~2015:

(2) The reserve previously taken against this loan is being accreted up to the face amount through the maturity date. In June 2013, the redemption date was extended from July 2014 to July 2015.



Property	Disposition Date	Property Type	Approximate Usable Square Feet	Sales Price⁽¹⁾ (in millions)		Gain on Sale⁽²⁾ (in millions)
180 Maiden Lane	January 2015	Office	1,090,000	$	470.0	$	17.0
131-137 Spring Street⁽³⁾	August 2015	Office	68,342	277.8		101.1
120 West 45th Street	September 2015	Office	440,000	365.0		58.6

~~(3) As of September 30, 2013, we were committed to fund an additional $1.4 million on this loan.~~____________________________________________________________________

~~The~~(1) ~~following~~Sales ~~table~~price isrepresents athe ~~rollforward~~actual ofsales ~~our~~price ~~total~~for ~~loan~~a ~~loss~~property ~~reserves~~or atthe ~~September 30,~~gross ~~2013~~asset ~~and~~valuation ~~December 31,~~for ~~2012~~interests (in ~~thousands):~~a property.

	September 30, 2013			December 31, 2012
Balance at beginning of year	$	7,000		$	50,175
Expensed	—			3,000
Recoveries	—			(2,436		)
Charge-offs and reclassifications	(3,000		)	(43,739		)
Balance at end of period	$	4,000		$	7,000


(2)	The gain on sale for 180 Maiden Lane, 131-137 Spring Street, and 120 West 45th Street are net of employee compensation awards accrued in connection with the realization of these investment gains as a bonus to certain employees that were instrumental in realizing the gain on sale. Additionally, amounts do not include adjustments for expenses recorded in subsequent periods.

At(3) ~~September 30,~~We ~~2013~~sold ~~and~~an ~~December 31,~~80% ~~2012,~~interest ~~all~~in ~~debt~~131-137 Spring Street and ~~preferred~~have ~~equity~~subsequently ~~investments,~~accounted ~~other~~for ~~than~~our asinterest ~~noted~~in ~~above,~~the ~~were~~properties ~~performing~~as an investment in ~~accordance~~unconsolidated ~~with~~joint ~~the~~ventures. ~~terms~~See ofNote ~~the~~6, ~~loan~~"Investments ~~agreements~~in Unconsolidated Joint Ventures."

WeDiscontinued have determined that we have one portfolio segment of financing receivables at September 30, 2013 and December 31, 2012, comprising commercial real estate, which is primarily recorded in debt and preferred equity investments. Included in other assets is an additional amount of financing receivables totaling approximately $145.8 million at September 30, 2013 and Operations

22The Company adopted ASU 2014-08 effective January 1, 2015. As a result, the Company classified 570-574 Fifth Avenue and 140-150 Grand Street in White Plains, New York as held for sale as of September 30, 2015, and 131-137 Spring Street and 120 West 45th Street as of June 30, 2015 and included the results of operations in continuing operations for all periods presented. Discontinued operations included the results of operations of real estate assets sold or held for sale prior to January 1, 2015. This included 180 Maiden Lane, which was held for sale at December 31, 2014 and sold in January 2015, and 2 Herald Square, 985-987 Third Avenue and 673 First Avenue, which were sold during 2014.

Table of Contents

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

Notes to Consolidated Financial Statements (cont.)

September 30, ~~2013~~2015

(unaudited)

~~$121.3~~The ~~million~~following attable ~~December 31,~~summarizes ~~2012.~~net Noincome ~~financing~~from ~~receivables~~discontinued ~~were~~operations 90for ~~days~~the ~~past~~three ~~due~~and ornine onmonths ~~non-accrual~~ended ~~status at~~ September 30, ~~2013.~~2015 and 2014, respectively (in thousands):

The following table presents impaired loans, which may include non-accrual loans, as of September 30, 2013 and December 31, 2012, respectively (in thousands):



	Three Months Ended September 30,					Nine Months Ended September 30,
	2015		2014			2015			2014
Revenues
Rental revenue	$	—	$	9,504		$	236		$	44,676
Escalation and reimbursement revenues	—		(194		)	(127		)	4,413
Other income	—		—			—			21
Total revenues	—		9,310			109			49,110
Operating expenses	—		773			(631		)	7,101
Real estate taxes	—		787			250			6,618
Ground rent	—		—			—			3,001
Transaction related costs	—		115			(49		)	155
Interest expense, net of interest income	—		2,874			109			10,983
Amortization of deferred financing costs	—		48			3			369
Depreciation and amortization	—		678			—			5,434
Total expenses	—		5,275			(318		)	33,661
Net income from discontinued operations	$	—	$	4,035		$	427		$	15,449

	September 30, 2013						December 31, 2012
	Unpaid PrincipalBalance		RecordedInvestment		AllowanceAllocated		UnpaidPrincipalBalance		RecordedInvestment		AllowanceAllocated
With no related allowance recorded:
Commercial real estate	$	—	$	—	$	—	$	—	$	—	$	—
With an allowance recorded:
Commercial real estate	10,750		10,750		4,000		10,750		10,750		7,000
Total	$	10,750	$	10,750	$	4,000	$	10,750	$	10,750	$	7,000

5. Debt and Preferred Equity Investments

~~The~~During ~~following~~the ~~table~~nine ~~presents~~months ~~the~~ended ~~average~~September ~~recorded~~30, ~~investment~~2015 inand ~~impaired~~2014, ~~loans~~our debt and preferred equity investments, ~~which~~net ~~may~~of ~~include~~discounts ~~non-accrual~~and ~~loans~~deferred origination fees, increased $464.9 million and ~~the~~$476.6 ~~related~~million, ~~investment~~respectively, due to originations, purchases, advances under future funding obligations, discount amortization, and ~~preferred~~paid-in-kind ~~equity~~interest, ~~income~~net ~~recognized~~of ~~during~~premium ~~the~~amortization. ~~three~~We recorded repayments, participations and sales of $372.1 million and $348.5 million during the nine months ended September 30, ~~2013~~2015 and ~~2012~~2014, respectively, (which offset the increases in ~~thousands):~~debt and preferred equity investments.

	Three Months Ended September 30,					Nine Months Ended September 30,
	2013		2012			2013		2012
Average recorded investment in impaired loans	$	10,890	$	40,304		$	10,877	$	63,391
Investment and preferred equity income recognized	3,316		(298		)	3,804		3,480

Debt Investments

OnAs anof ~~ongoing basis~~September 30, we2015 ~~monitor~~and ~~the~~December ~~credit~~31, ~~quality~~2014, ofwe ~~our~~held ~~financing~~the ~~receivables~~following ~~based~~debt oninvestments ~~payment~~with ~~activity.~~an Weaggregate ~~assess~~weighted ~~credit~~average ~~quality~~current ~~indicators~~yield ~~based~~of on10.32% ~~the~~at ~~underlying~~September 30, ~~collateral.~~2015 (in thousands):

6. Investments in Unconsolidated Joint Ventures



Loan Type	September 30, 2015 Future Funding Obligations		September 30, 2015 Senior Financing		September 30, 2015 Carrying Value ⁽¹⁾		December 31, 2014 Carrying Value ⁽¹⁾		Initial Maturity Date
Fixed Rate Investments:
Jr. Mortgage Participation /Mezzanine Loan	$	—	$	205,000	$	72,541	$	70,688	February 2016
Jr. Mortgage Participation/Mezzanine Loan⁽²⁾⁽³⁾	—		—		23,371		45,611		May 2016
Jr. Mortgage Participation	—		133,000		49,000		49,000		June 2016
Mezzanine Loan	—		165,000		72,031		71,656		November 2016
Jr. Mortgage Participation/Mezzanine Loan	—		1,109,000		102,709		98,934		March 2017
Mezzanine Loan⁽³⁾	—		—		66,075		65,770		March 2017
Mezzanine Loan⁽⁴⁾	155		502,100		40,938		24,608		June 2017
Mezzanine Loan	—		539,000		49,666		49,629		July 2018
Mortgage Loan⁽⁵⁾	—		—		26,249		26,209		February 2019
Mortgage Loan	—		—		545		637		August 2019

We have investments in several real estate joint ventures with various partners, including SITQ Immobilier, a subsidiary of Caisse de depot et placement du Quebec, or SITQ, Canada Pension Plan Investment Board, or CPPIB, Prudential Real Estate Investors, or Prudential, Onyx Equities, or Onyx, The Witkoff Group, or Witkoff, Credit Suisse Securities (USA) LLC, or Credit Suisse, Jeff Sutton, or Sutton, Harel Insurance and Finance, or Harel, Louis Cappelli, or Cappelli, The Moinian Group, or Moinian, Vornado Realty Trust (NYSE: VNO), or Vornado, Blackstone Real Estate Partners VII, or Blackstone, Plaza Global Real Estate Partners LP, or Plaza, Angelo Gordon Real Estate Inc., or AG, as well as private investors. All the investments below are voting interest entities, except for 33 Beekman, 3 Columbus Circle and 180/182 Broadway which are VIEs in which we are not the primary beneficiary. Our net equity investment in these three VIEs was $136.7 million and $117.7 million at September 30, 2013 and December 31, 2012, respectively. As we do not control the joint ventures listed below, we account for them under the equity method of accounting.32

Table of Contents

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

Notes to Consolidated Financial Statements (cont.)

September 30, ~~2013~~2015

(unaudited)

The table below provides general information on each of our joint ventures as of September 30, 2013 (amounts in thousands):



Loan Type	September 30, 2015 Future Funding Obligations		September 30, 2015 Senior Financing		September 30, 2015 Carrying Value ⁽¹⁾		December 31, 2014 Carrying Value ⁽¹⁾		Initial Maturity Date
Mezzanine Loan	—		15,000		3,500		3,500		September 2021
Mezzanine Loan⁽⁶⁾	—		90,000		19,934		19,930		November 2023
Mezzanine Loan	—		95,000		30,000		30,000		January 2025
Mezzanine Loan⁽⁷⁾	—		—		—		14,068
Jr. Mortgage Participation⁽⁸⁾	—		—		—		11,934
Total fixed rate	$	155	$	2,853,100	$	556,559	$	582,174
Floating Rate Investments:
Mezzanine Loan	—		775,000		74,349		73,402		March 2016
Mortgage/Mezzanine Loan	14,981		—		81,730		—		April 2016
Mezzanine Loan⁽⁹⁾	—		160,000		22,612		22,573		June 2016
Jr. Mortgage Participation	—		30,000		15,000		—		July 2016
Mezzanine Loan	—		115,000		24,914		24,910		July 2016
Mezzanine Loan⁽¹⁰⁾	—		110,000		50,000		49,614		September 2016
Mezzanine Loan	—		360,000		99,398		99,023		November 2016
Mezzanine Loan	9,726		304,610		64,430		—		November 2016
Mezzanine Loan⁽¹¹⁾	12,885		127,824		48,226		42,750		December 2016
Mezzanine Loan	461		38,687		13,539		11,835		December 2016
Mortgage/Mezzanine Loan⁽¹²⁾	66,314		—		124,789		—		January 2017
Mezzanine Loan	1,851		118,718		27,956		20,651		January 2017
Jr. Mortgage Participation/Mezzanine Loan	1,508		117,460		40,034		38,524		July 2017
Mortgage/Mezzanine Loan	—		—		22,858		22,803		July 2017
Mortgage/Mezzanine Loan	—		—		16,887		16,848		September 2017
Mezzanine Loan	—		60,000		14,892		14,859		November 2017
Mortgage/Mezzanine Loan⁽¹³⁾	795		—		14,917		14,845		December 2017
Jr. Mortgage Participation	—		40,000		19,830		—		April 2018
Mezzanine Loan	—		350,000		34,698		—		April 2018
Jr. Mortgage Participation/Mezzanine Loan	—		55,000		20,516		20,533		July 2018
Mortgage/Mezzanine Loan	1,500		—		31,185		—		August 2018
Mortgage/Mezzanine Loan	—		—		18,316		18,083		February 2019
Mezzanine Loan	—		38,000		21,835		21,807		March 2019
Mezzanine Loan⁽¹⁴⁾	—		—		—		33,726
Mezzanine Loan⁽¹⁴⁾	—		—		—		37,322
Mortgage/Mezzanine Loan⁽¹⁵⁾	—		—		—		109,527
Total floating rate	$	110,021	$	2,800,299	$	902,911	$	693,635
Total	$	110,176	$	5,653,399	$	1,459,470	$	1,275,809

Property	Partner	Ownership Interest		Economic Interest		Square Feet	Acquired	Acquisition Price(1)
100 Park Avenue	Prudential	49.90	%	49.90	%	834	January 2000	$	95,800
21 West 34th Street	Sutton	50.00	%	50.00	%	30	July 2005	22,400
1604-1610 Broadway(2)	Onyx	70.00	%	70.00	%	30	November 2005	4,400
27-29 West 34th Street	Sutton	50.00	%	50.00	%	41	January 2006	30,000
717 Fifth Avenue	Sutton/Private Investor	10.92	%	10.92	%	120	September 2006	251,900
800 Third Avenue	Private Investors	42.95	%	42.95	%	526	December 2006	285,000
1745 Broadway	Witkoff/SITQ/Lehman Bros.	32.26	%	32.26	%	674	April 2007	520,000
1 and 2 Jericho Plaza	Onyx/Credit Suisse	20.26	%	20.26	%	640	April 2007	210,000
The Meadows	Onyx	50.00	%	50.00	%	582	September 2007	111,500
388 and 390 Greenwich Street(3)	SITQ	50.60	%	50.60	%	2,600	December 2007	1,575,000
180/182 Broadway(4)	Harel/Sutton	25.50	%	25.50	%	71	February 2008	43,600
600 Lexington Avenue	CPPIB	55.00	%	55.00	%	304	May 2010	193,000
11 West 34th Street	Private Investor/Sutton	30.00	%	30.00	%	17	December 2010	10,800
7 Renaissance	Cappelli	50.00	%	50.00	%	37	December 2010	4,000
3 Columbus Circle(5)	Moinian	48.90	%	48.90	%	769	January 2011	500,000
280 Park Avenue	Vornado	50.00	%	49.50	%	1,237	March 2011	400,000
1552-1560 Broadway(6)	Sutton	50.00	%	50.00	%	49	August 2011	136,550
747 Madison Avenue	Harel/Sutton	33.33	%	33.33	%	10	September 2011	66,250
724 Fifth Avenue	Sutton	50.00	%	50.00	%	65	January 2012	223,000
10 East 53rd Street	CPPIB	55.00	%	55.00	%	390	February 2012	252,500
33 Beekman(7)	Harel/Private Investor	45.90	%	45.90	%	145	August 2012	31,000
West Coast office portfolio(8)	Blackstone	42.02	%	43.74	%	4,067	September 2012	880,103
521 Fifth Avenue(9)	Plaza	50.50	%	50.50	%	460	November 2012	315,000
21 East 66th Street(10)	Private Investors	32.28	%	32.28	%	17	December 2012	75,000
315 West 36th Street	Private Investors	35.50	%	35.50	%	148	December 2012	45,000
Herald Center(11)	AG	40.00	%	40.00	%	365	January 2013	50,000

____________________________________________________________________

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

(12) ~~Acquisition~~The ~~price~~$22.9 ~~represents~~million ~~the~~junior ~~actual~~mortgage orparticipation, ~~implied~~which ~~gross~~matures ~~purchase~~in ~~price~~February ~~for~~2016, ~~the~~was ~~joint~~sold ~~venture~~in July 2015.

(23) InThese ~~March~~loans ~~2013,~~are ~~Sutton~~collateralized ~~conveyed~~by ~~his~~defeasance ~~interest in this property to us~~securities.

(34) ~~The~~Carrying ~~property~~value is ~~subject to a triple-~~net ~~lease~~of ~~arrangement~~$41.3 ~~with~~million athat ~~single~~was ~~tenant~~participated out, which ~~expires~~is included in ~~2020~~other assets and other liabilities on the consolidated balance sheets as a result of the transfer not meeting the conditions for sale accounting.

(45) In ~~June~~September ~~2013~~2014, ~~the~~we ~~joint~~acquired ~~venture~~a ~~completed~~$26.4 ~~its~~million ~~redevelopment~~mortgage ~~project~~loan at a $0.2 million discount and ~~has~~a ~~conveyed~~$5.7 million junior mortgage participation at a ~~30-year~~$5.7 ~~ground~~million ~~lease~~discount. ~~condominium~~The ~~interest~~junior inmortgage ~~the~~participation ~~building~~was toa ~~Pace~~nonperforming ~~University,~~loan orat ~~Pace,~~acquisition ~~its~~and ~~primary~~is ~~tenant~~currently on non-accrual status.

(56) WeCarrying ~~had~~value anis ~~obligation~~net toof ~~fund an additional~~ $~~47.~~5.0 million tothat ~~the~~was ~~joint~~participated ~~venture~~out, which ~~has~~is ~~been~~included ~~fully~~in ~~funded~~other asassets ofand ~~June~~other ~~30,~~liabilities ~~2013.~~on ~~As a result of~~ the ~~sale~~consolidated ofbalance asheets ~~condominium~~as ~~interest in September 2012, Young & Rubicam, Inc., or Y&R, owns~~ a ~~portion~~result of the ~~property,~~transfer ~~generally~~not ~~floors~~meeting ~~three through eight referred to as Y&R units. As~~ the ~~joint~~conditions ~~venture~~for ~~has~~sale ~~an option to repurchase the Y&R units, no gain was recognized on this transaction~~accounting.

(67) InThis ~~connection~~loan ~~with~~was ~~this~~repaid ~~acquisition, the joint venture also acquired a long-term leasehold interest~~ in ~~the~~February ~~retail space and certain other spaces at 1560 Broadway, which is adjacent to 1552 Broadway~~2015. ~~The purchase price relates only to the purchase of the 1552 Broadway interest which comprises 13,045 square feet. In 2012, we,~~

2433

Table of Contents

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

Notes to Consolidated Financial Statements (cont.)

September 30, ~~2013~~2015

(unaudited)

~~along~~(8) ~~with~~This ~~Sutton,~~loan ~~acquired~~was ~~the~~repaid ~~property~~in atMarch ~~155 West 46th Street, which is adjacent to 1552 and 1560 Broadway, and sold it to the fee owner of 1560 Broadway~~2015.

(79) ~~The~~Carrying ~~joint~~value ~~venture~~is ~~acquired~~net ~~the~~of ~~fee~~$7.4 ~~interest~~million inthat ~~the~~was ~~property~~participated ~~and~~out, ~~will~~which ~~develop~~is anincluded ~~approximately~~in 30other ~~story~~assets ~~building~~and ~~for~~other ~~student~~liabilities ~~housing.~~on ~~Upon completion of~~ the ~~development,~~consolidated ~~the~~balance ~~joint~~sheets ~~venture~~as ~~will convey~~ a ~~long-term~~result ~~ground~~of ~~lease~~the ~~condominium~~transfer ~~interest~~not inmeeting the ~~building~~conditions tofor ~~Pace~~sale accounting.

(810) Prior to the recapitalization in September 2012, the Company held $26.7 million in mezzanine and preferred equity positions in the entity that owned the portfolio. Following the recapitalization, Blackstone became the majority owner of the joint venture, with Equity Office Properties, a Blackstone affiliate, being responsible for the portfolio’s management and leasing. In ~~February~~August ~~2013~~2015, ~~we acquired Gramercy’s 10.73% interest in~~ the ~~joint~~maturity ~~venture~~date ~~and~~was ~~simultaneously~~extended ~~sold 20.78% of the newly acquired interest~~ to ~~Square Mile Capital Management LLC or Square Mile. During the nine months ended~~ September ~~30, 2013, we acquired Square Mile’s 6~~2016.00% interest in the joint venture and the joint venture sold three of the properties for an aggregate of $224.3 million, on which we recognized a gain of approximately $2.1 million. The proceeds from the sale of these properties were used primarily to repay $194.5 million of the mortgage and $20.5 million of the mezzanine loan.

(911) ~~Following~~In ~~the~~February ~~sale of our 49.5% partnership interest in 521 Fifth Avenue~~2015, ~~we deconsolidated~~ the ~~entity~~maturity ~~effective~~date ~~November~~was ~~30,~~extended ~~2012~~to ~~and~~December ~~have accounted for our investment under the equity method~~2016.

(1012) WeCarrying ~~hold~~value ais 32net of $25.~~28%~~0 ~~interest~~million that was participated out, which is included in ~~three~~other ~~retail~~assets and ~~two~~other ~~residential~~liabilities ~~units~~on at the ~~property~~consolidated ~~and~~balance sheets as a ~~16.14%~~result inof ~~four~~the ~~residential~~transfer ~~units~~not atmeeting the ~~property~~conditions for sale accounting.

(1113) ~~The~~Carrying ~~joint~~value ~~venture~~is ~~acquired~~net aof ~~preferred~~$5.1 ~~equity~~million ~~interest~~that inwas anparticipated ~~entity~~out, ~~that~~which ~~holds~~is ~~the~~included ~~interest~~ in aother ~~mixed~~assets ~~commercial~~and ~~use~~other ~~property~~liabilities ~~located~~on inthe ~~Manhattan.~~consolidated ~~The~~balance ~~preferred~~sheets ~~equity~~as ~~bears interest at~~ a ~~rate~~result of ~~8.75%~~the ~~per~~transfer ~~annum~~not ~~and~~meeting ~~matures~~the inconditions ~~June~~for ~~2016~~sale accounting.

25(14) These loans were repaid in April 2015.


(15)	This loan was repaid in August 2015.

Preferred Equity Investments

As of September 30, 2015 and December 31, 2014, we held the following preferred equity investments with an aggregate weighted average current yield of 7.77% at September 30, 2015 (in thousands):



Type	September 30, 2015 Future Funding Obligations		September 30, 2015 Senior Financing		September 30, 2015 Carrying Value ⁽¹⁾		December 31, 2014 Carrying Value ⁽¹⁾		Initial Mandatory Redemption
Preferred equity⁽²⁾	$	—	$	70,000	$	9,964	$	9,954	March 2018
Preferred equity	5,580		60,387		32,185		—		November 2018
Preferred equity⁽³⁾	—		—		—		123,041
	$	5,580	$	130,387

Filing Compare · SL GREEN OPERATING PARTNERSHIP, L.P.