Funds from operations applicable to common shares for Q1 2005 were $248.7 million, or $1.84 per diluted share, Vornado reported yesterday, compared to $129 million, or $1.01 per diluted share, a year earlier. Adjusting for certain items that affect comparability, Q1 2005 is 11.7% higher than a year earlier.

The results come on the basis of Q1 revenues of just under $597.5 million, a 51% increase from Q1 2004's $391.4 million.

Company officials declined to comment on the results. But Vornado, perhaps better known for its high-profile Manhattan office holdings, was highly active in the retail category during Q1 just ended. Through Alexander's Inc., a REIT managed and one-third owned by Vornado, a year-long planning process has finally been launched for a mixed-use project in Rego Park, NY. Projected to encompass 600,000 sf of retail on four levels, 450 apartments in two 20-story towers and a parking deck for 1,400 cars, the project had become controversial when it was announced that Alexander's was courting Wal-Mart as an anchor tenant.

But Wal-Mart is apparently out of the picture, and a Century 21 will now take a 135,000-sf anchor slot.

"We do a lot of business with Wal-Mart and were talking to them, among others, about Rego Park," says Steven Roth, Vornado's chairman/CEO, in the company's annual report. "We believe in Wal-Mart, but Wal-Mart has its critics, and when it became certain that the entire project could be rejected if Wal-Mart were a tenant, we had no choice but to continue without them."

Q1 also saw Vornado team up with Bain Capital and Kohlberg, Kravis, Roberts to buy the struggling Wayne, NJ-based Toys 'R' Us Inc., ending a lengthy bidding process for the chain. The final sale price was $6.6 billion, and Vornado's actual capital stake in the venture is said to be in the $450 million range.

Also in Q1, Vornado picked up the 17,000-sf retail condo portion of the former Westbury Hotel on the Madison Ave. blockfront from 69th to 70th streets. Vornado paid a pricey $113 million for the asset, which is 100% occupied by such retailers as Cartier, Chloe and Gucci.

Vornado also formally launched a $102 million redevelopment of the one million-sf Bergen Mall in Paramus, NJ. The company had acquired the property in late 2003 from Simon Property Group for $145 million. The current plan is to rename it the Bergen Town Center and redevelop it in phases through 2008.

And in California, Vornado bought a 50% interest in the 322,000-sf Beverly Connection shopping center. Besides paying $10.7 million to a venture of Apollo Real Estate Advisors and Westrust, Vornado provided $35 million in preferred equity and a three-year first mortgage of $59.5 million.

Finally, as Q1 ended, Vornado Realty LP, the REIT's operating partnership, announced a public offering of $500 million aggregate principal amount of 3.875% senior debentures due in 2025. Proceeds of the offering, which is being underwritten by Citigroup Global Markets, will be used "for working capital and other corporate purposes," according to a prepared statement.