Vornado Shakeup as REIT Cuts 70 Jobs, CFO Steps Down
By Nicholas Rizzi December 1, 2020 5:11 pm
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Vornado Realty Trust announced a shakeup in its ranks on Tuesday with the exit of its long-time chief financial officer along with the company laying off 70 people amid a cost-cutting program.
The Steven Roth-led real estate investment trust said that CFO Joseph Macnow, who has been with Vornado since 1981 and also serves as the chief administrative officer, will step down from his post at the end of the month, but will remain a senior adviser to the company.
Macnow will be replaced by Vornado President Michael Franco, who will also continue in his current role, according to Vornado.
Aside from the change in the C-suite, Vornado also said it would start a $35 million program to reduce its annual overhead, which includes cutting some salaries and laying off 70 of its employees. Vornado said that the moves will cause a $23 million reduction in net income for the fourth quarter.
The company, like many other landlords, faced a challenging year as the coronavirus pandemic emptied offices, brought leasing activity to a screeching halt, and left retailers struggling to pay rent.
In the third quarter of this year, Vornado’s rental revenue dropped by 25 percent compared to 2019, from $428 million to $322 million, Crain’s New York Business reported. Occupancy in its retail portfolio was down to 80 percent from nearly 95 percent, while office leasing was also lower, according to Crain’s.
Vornado has started to take retail tenants to court over missed rent, filing a lawsuit in October against Planet Hollywood for failing to pay $5.5 million in unpaid bills at its Times Square location at 1540 Broadway.
However, Vornado had some bright spots this year, including signing a 730,000-square-foot lease with Facebook at its Farley Post Office redevelopment in August.
