Quarterly Report (10-q)

0001553079--12-31false2022Q3P1YP3YP4YP3Y00015530792022-01-012022-09-300001553079esrt:SeriesESOperatingPartnershipUnitsMember2022-01-012022-09-300001553079esrt:Series60OperatingPartnershipUnitsMember2022-01-012022-09-300001553079esrt:Series250OperatingPartnershipUnitsMember2022-01-012022-09-300001553079esrt:SeriesESOperatingPartnershipUnitsMember2022-10-28xbrli:shares0001553079esrt:Series60OperatingPartnershipUnitsMember2022-10-280001553079esrt:Series250OperatingPartnershipUnitsMember2022-10-2800015530792022-09-30iso4217:USD00015530792021-12-310001553079esrt:PrivatePerpetualPreferredUnitsSeries2019Member2022-09-30iso4217:USDxbrli:shares0001553079esrt:PrivatePerpetualPreferredUnitsSeries2019Member2021-12-310001553079esrt:PrivatePerpetualPreferredUnitsSeries2014Member2022-09-300001553079esrt:PrivatePerpetualPreferredUnitsSeries2014Member2021-12-310001553079srt:ParentCompanyMemberesrt:SeriesPRCommonUnitsMember2022-09-300001553079srt:ParentCompanyMemberesrt:SeriesPRCommonUnitsMember2021-12-310001553079esrt:SeriesPRCommonUnitsMember2022-09-300001553079esrt:SeriesPRCommonUnitsMember2021-12-310001553079esrt:SeriesESOperatingPartnershipUnitsMember2022-09-300001553079esrt:SeriesESOperatingPartnershipUnitsMember2021-12-310001553079esrt:Series60OperatingPartnershipUnitsMember2022-09-300001553079esrt:Series60OperatingPartnershipUnitsMember2021-12-310001553079esrt:Series250OperatingPartnershipUnitsMember2022-09-300001553079esrt:Series250OperatingPartnershipUnitsMember2021-12-3100015530792022-07-012022-09-3000015530792021-07-012021-09-3000015530792021-01-012021-09-300001553079esrt:PrivatePerpetualPreferredUnitsMember2022-06-300001553079us-gaap:GeneralPartnerMemberesrt:SeriesPRCommonUnitsMember2022-06-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesPRCommonUnitsMember2022-06-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesESOperatingPartnershipUnitsMember2022-06-300001553079us-gaap:LimitedPartnerMemberesrt:Series60OperatingPartnershipUnitsMember2022-06-300001553079us-gaap:LimitedPartnerMemberesrt:Series250OperatingPartnershipUnitsMember2022-06-300001553079esrt:NoncontrollingInterestsInTheJointVenturesMember2022-06-3000015530792022-06-300001553079us-gaap:GeneralPartnerMemberesrt:SeriesPRCommonUnitsMember2022-07-012022-09-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesPRCommonUnitsMember2022-07-012022-09-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesESOperatingPartnershipUnitsMember2022-07-012022-09-300001553079us-gaap:LimitedPartnerMemberesrt:Series60OperatingPartnershipUnitsMember2022-07-012022-09-300001553079us-gaap:LimitedPartnerMemberesrt:Series250OperatingPartnershipUnitsMember2022-07-012022-09-300001553079esrt:NoncontrollingInterestsInTheJointVenturesMember2022-07-012022-09-300001553079esrt:PrivatePerpetualPreferredUnitsMember2022-07-012022-09-300001553079esrt:PrivatePerpetualPreferredUnitsMember2022-09-300001553079us-gaap:GeneralPartnerMemberesrt:SeriesPRCommonUnitsMember2022-09-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesPRCommonUnitsMember2022-09-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesESOperatingPartnershipUnitsMember2022-09-300001553079us-gaap:LimitedPartnerMemberesrt:Series60OperatingPartnershipUnitsMember2022-09-300001553079us-gaap:LimitedPartnerMemberesrt:Series250OperatingPartnershipUnitsMember2022-09-300001553079esrt:NoncontrollingInterestsInTheJointVenturesMember2022-09-300001553079esrt:PrivatePerpetualPreferredUnitsMember2021-06-300001553079us-gaap:GeneralPartnerMemberesrt:SeriesPRCommonUnitsMember2021-06-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesPRCommonUnitsMember2021-06-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesESOperatingPartnershipUnitsMember2021-06-300001553079us-gaap:LimitedPartnerMemberesrt:Series60OperatingPartnershipUnitsMember2021-06-300001553079us-gaap:LimitedPartnerMemberesrt:Series250OperatingPartnershipUnitsMember2021-06-300001553079esrt:NoncontrollingInterestsInTheJointVenturesMember2021-06-3000015530792021-06-300001553079us-gaap:GeneralPartnerMemberesrt:SeriesPRCommonUnitsMember2021-07-012021-09-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesPRCommonUnitsMember2021-07-012021-09-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesESOperatingPartnershipUnitsMember2021-07-012021-09-300001553079us-gaap:LimitedPartnerMemberesrt:Series60OperatingPartnershipUnitsMember2021-07-012021-09-300001553079us-gaap:LimitedPartnerMemberesrt:Series250OperatingPartnershipUnitsMember2021-07-012021-09-300001553079esrt:PrivatePerpetualPreferredUnitsMember2021-07-012021-09-300001553079esrt:PrivatePerpetualPreferredUnitsMember2021-09-300001553079us-gaap:GeneralPartnerMemberesrt:SeriesPRCommonUnitsMember2021-09-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesPRCommonUnitsMember2021-09-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesESOperatingPartnershipUnitsMember2021-09-300001553079us-gaap:LimitedPartnerMemberesrt:Series60OperatingPartnershipUnitsMember2021-09-300001553079us-gaap:LimitedPartnerMemberesrt:Series250OperatingPartnershipUnitsMember2021-09-300001553079esrt:NoncontrollingInterestsInTheJointVenturesMember2021-09-3000015530792021-09-300001553079esrt:PrivatePerpetualPreferredUnitsMember2021-12-310001553079us-gaap:GeneralPartnerMemberesrt:SeriesPRCommonUnitsMember2021-12-310001553079us-gaap:LimitedPartnerMemberesrt:SeriesPRCommonUnitsMember2021-12-310001553079us-gaap:LimitedPartnerMemberesrt:SeriesESOperatingPartnershipUnitsMember2021-12-310001553079us-gaap:LimitedPartnerMemberesrt:Series60OperatingPartnershipUnitsMember2021-12-310001553079us-gaap:LimitedPartnerMemberesrt:Series250OperatingPartnershipUnitsMember2021-12-310001553079esrt:NoncontrollingInterestsInTheJointVenturesMember2021-12-310001553079us-gaap:GeneralPartnerMemberesrt:SeriesPRCommonUnitsMember2022-01-012022-09-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesPRCommonUnitsMember2022-01-012022-09-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesESOperatingPartnershipUnitsMember2022-01-012022-09-300001553079us-gaap:LimitedPartnerMemberesrt:Series60OperatingPartnershipUnitsMember2022-01-012022-09-300001553079us-gaap:LimitedPartnerMemberesrt:Series250OperatingPartnershipUnitsMember2022-01-012022-09-300001553079esrt:NoncontrollingInterestsInTheJointVenturesMember2022-01-012022-09-300001553079esrt:PrivatePerpetualPreferredUnitsMember2022-01-012022-09-300001553079esrt:PrivatePerpetualPreferredUnitsMember2020-12-310001553079us-gaap:GeneralPartnerMemberesrt:SeriesPRCommonUnitsMember2020-12-310001553079us-gaap:LimitedPartnerMemberesrt:SeriesPRCommonUnitsMember2020-12-310001553079us-gaap:LimitedPartnerMemberesrt:SeriesESOperatingPartnershipUnitsMember2020-12-310001553079us-gaap:LimitedPartnerMemberesrt:Series60OperatingPartnershipUnitsMember2020-12-310001553079us-gaap:LimitedPartnerMemberesrt:Series250OperatingPartnershipUnitsMember2020-12-310001553079esrt:NoncontrollingInterestsInTheJointVenturesMember2020-12-3100015530792020-12-310001553079us-gaap:GeneralPartnerMemberesrt:SeriesPRCommonUnitsMember2021-01-012021-09-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesPRCommonUnitsMember2021-01-012021-09-300001553079us-gaap:LimitedPartnerMemberesrt:SeriesESOperatingPartnershipUnitsMember2021-01-012021-09-300001553079us-gaap:LimitedPartnerMemberesrt:Series60OperatingPartnershipUnitsMember2021-01-012021-09-300001553079us-gaap:LimitedPartnerMemberesrt:Series250OperatingPartnershipUnitsMember2021-01-012021-09-300001553079esrt:PrivatePerpetualPreferredUnitsMember2021-01-012021-09-30utr:sqft0001553079srt:OfficeBuildingMember2022-09-30esrt:office_property0001553079esrt:DevelopmentParcelMember2022-09-30esrt:parcel0001553079esrt:ManhattanMembersrt:OfficeBuildingMember2022-09-300001553079esrt:ManhattanMembersrt:RetailSiteMember2022-09-300001553079esrt:FairfieldCountyConnecticutandWestchesterCountyNewYorkMembersrt:OfficeBuildingMember2022-09-300001553079esrt:StamfordConnecticutMembersrt:OtherPropertyMember2022-09-300001553079esrt:WestportConnecticutMembersrt:RetailSiteMember2022-09-300001553079esrt:ManhattanandWestportConnecticutMembersrt:RetailSiteMember2022-09-300001553079srt:MultifamilyMember2022-09-30esrt:multifamily_property0001553079srt:MultifamilyMember2022-01-012022-09-30esrt:property_unit0001553079esrt:EmpireStateRealtyOPMemberesrt:EmpireStateRealtyTrustMember2022-01-012022-09-30xbrli:pure0001553079srt:MinimumMember2022-09-300001553079srt:MaximumMember2022-09-3000015530792022-04-3000015530792022-04-012022-04-3000015530792021-12-012021-12-310001553079us-gaap:SubsequentEventMemberus-gaap:DisposalGroupDisposedOfBySaleNotDiscontinuedOperationsMemberesrt:MamaroneckAvenueAndBankStreetMember2022-11-030001553079esrt:AcquiredInPlaceLeaseValueAndDeferredLeasingCostsMember2022-09-300001553079esrt:AcquiredInPlaceLeaseValueAndDeferredLeasingCostsMember2021-12-310001553079us-gaap:AboveMarketLeasesMember2022-09-300001553079us-gaap:AboveMarketLeasesMember2021-12-310001553079esrt:CreditFacilityRevolvingCreditFacilityMemberus-gaap:RevolvingCreditFacilityMember2022-09-300001553079esrt:CreditFacilityRevolvingCreditFacilityMemberus-gaap:RevolvingCreditFacilityMember2021-12-310001553079us-gaap:LeaseAgreementsMember2022-07-012022-09-300001553079us-gaap:LeaseAgreementsMember2021-07-012021-09-300001553079us-gaap:LeaseAgreementsMember2022-01-012022-09-300001553079us-gaap:LeaseAgreementsMember2021-01-012021-09-300001553079esrt:ObservatorySegmentMember2022-09-300001553079esrt:RealEstateSegmentMember2022-09-300001553079us-gaap:MortgagesMemberesrt:MetroCenterDebtMember2022-09-300001553079us-gaap:MortgagesMemberesrt:MetroCenterDebtMember2021-12-310001553079us-gaap:MortgagesMemberesrt:FixedRateDebt10UnionSquareMember2022-09-300001553079us-gaap:MortgagesMemberesrt:FixedRateDebt10UnionSquareMember2021-12-310001553079us-gaap:MortgagesMemberesrt:FixedRateDebt1542ThirdAvenueMember2022-09-300001553079us-gaap:MortgagesMemberesrt:FixedRateDebt1542ThirdAvenueMember2021-12-310001553079esrt:FixedRateDebtFirstStamfordPlaceMemberus-gaap:MortgagesMember2022-09-300001553079esrt:FixedRateDebtFirstStamfordPlaceMemberus-gaap:MortgagesMember2021-12-310001553079us-gaap:MortgagesMemberesrt:FixedRateDebt1010ThirdAvenueand77West55thStreetMember2022-09-300001553079us-gaap:MortgagesMemberesrt:FixedRateDebt1010ThirdAvenueand77West55thStreetMember2021-12-310001553079us-gaap:MortgagesMemberesrt:FixedRateDebt250West57thStreetMember2022-09-300001553079us-gaap:MortgagesMemberesrt:FixedRateDebt250West57thStreetMember2021-12-310001553079us-gaap:MortgagesMemberesrt:FixedRateDebt10BankStreetMember2022-09-300001553079us-gaap:MortgagesMemberesrt:FixedRateDebt10BankStreetMember2021-12-310001553079us-gaap:MortgagesMemberesrt:FixedRateDebt383MainAvenueMember2022-09-300001553079us-gaap:MortgagesMemberesrt:FixedRateDebt383MainAvenueMember2021-12-310001553079us-gaap:MortgagesMemberesrt:FixedRateDebt1333BroadwayMember2022-09-300001553079us-gaap:MortgagesMemberesrt:FixedRateDebt1333BroadwayMember2021-12-310001553079us-gaap:MortgagesMemberesrt:FixedRateDebt345East94thStreetSeriesAMember2022-09-300001553079us-gaap:MortgagesMemberesrt:FixedRateDebt345East94thStreetSeriesAMember2021-12-310001553079us-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:RevolvingCreditFacilityMemberesrt:FixedRateDebt345East94thStreetSeriesAMember2022-01-012022-09-300001553079us-gaap:MortgagesMemberesrt:FixedRateDebt345East94thStreetSeriesBMember2022-09-300001553079us-gaap:MortgagesMemberesrt:FixedRateDebt345East94thStreetSeriesBMember2021-12-310001553079us-gaap:LondonInterbankOfferedRateLIBORMemberesrt:FixedRateDebt345East94thStreetSeriesBMemberus-gaap:RevolvingCreditFacilityMember2022-01-012022-09-300001553079us-gaap:MortgagesMemberesrt:FixedRateDebt56110thAvenueSeriesAMember2022-09-300001553079us-gaap:MortgagesMemberesrt:FixedRateDebt56110thAvenueSeriesAMember2021-12-310001553079us-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:RevolvingCreditFacilityMemberesrt:FixedRateDebt56110thAvenueSeriesAMember2022-01-012022-09-300001553079esrt:FixedRateDebt56110thAvenueSeriesBMemberus-gaap:MortgagesMember2022-09-300001553079esrt:FixedRateDebt56110thAvenueSeriesBMemberus-gaap:MortgagesMember2021-12-310001553079esrt:FixedRateDebt56110thAvenueSeriesBMemberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:RevolvingCreditFacilityMember2022-01-012022-09-300001553079us-gaap:MortgagesMember2022-09-300001553079us-gaap:MortgagesMember2021-12-310001553079esrt:SeriesASeniorNotesdue2025Memberus-gaap:SeniorNotesMember2022-09-300001553079esrt:SeriesASeniorNotesdue2025Memberus-gaap:SeniorNotesMember2021-12-310001553079esrt:SeriesBSeniorNotesdue2027Memberus-gaap:SeniorNotesMember2022-09-300001553079esrt:SeriesBSeniorNotesdue2027Memberus-gaap:SeniorNotesMember2021-12-310001553079us-gaap:SeniorNotesMemberesrt:SeriesCSeniorNotesdue2030Member2022-09-300001553079us-gaap:SeniorNotesMemberesrt:SeriesCSeniorNotesdue2030Member2021-12-310001553079esrt:SeriesDSeniorNotesdue2028Memberus-gaap:SeniorNotesMember2022-09-300001553079esrt:SeriesDSeniorNotesdue2028Memberus-gaap:SeniorNotesMember2021-12-310001553079esrt:SeriesESeniorNotesdue2030Memberus-gaap:SeniorNotesMember2022-09-300001553079esrt:SeriesESeniorNotesdue2030Memberus-gaap:SeniorNotesMember2021-12-310001553079us-gaap:SeniorNotesMemberesrt:SeriesFSeniorNotesdue2033Member2022-09-300001553079us-gaap:SeniorNotesMemberesrt:SeriesFSeniorNotesdue2033Member2021-12-310001553079us-gaap:SeniorNotesMemberesrt:SeriesGSeniorNotesdue2032Member2022-09-300001553079us-gaap:SeniorNotesMemberesrt:SeriesGSeniorNotesdue2032Member2021-12-310001553079us-gaap:SeniorNotesMemberesrt:SeriesHSeniorNotesdue2035Member2022-09-300001553079us-gaap:SeniorNotesMemberesrt:SeriesHSeniorNotesdue2035Member2021-12-310001553079us-gaap:RevolvingCreditFacilityMemberesrt:CreditFacilityTermLoanMember2022-09-300001553079us-gaap:RevolvingCreditFacilityMemberesrt:CreditFacilityTermLoanMember2021-12-310001553079us-gaap:RevolvingCreditFacilityMemberus-gaap:SecuredOvernightFinancingRateSofrOvernightIndexSwapRateMemberesrt:CreditFacilityTermLoanMember2022-01-012022-09-300001553079esrt:CreditFacilityRevolvingCreditFacilityMemberus-gaap:RevolvingCreditFacilityMemberus-gaap:SecuredOvernightFinancingRateSofrOvernightIndexSwapRateMember2022-01-012022-09-300001553079us-gaap:RevolvingCreditFacilityMemberesrt:UnsecuredTermLoanMember2022-09-300001553079us-gaap:RevolvingCreditFacilityMemberesrt:UnsecuredTermLoanMember2021-12-310001553079us-gaap:RevolvingCreditFacilityMemberesrt:UnsecuredTermLoanMemberus-gaap:SecuredOvernightFinancingRateSofrOvernightIndexSwapRateMember2022-01-012022-09-300001553079esrt:MortgagesSeniorNotesAndUnsecuredTermLoanFacilitiesNotIncludingUnsecuredRevolvingCreditFacilityMember2022-09-300001553079esrt:MortgagesSeniorNotesAndUnsecuredTermLoanFacilitiesNotIncludingUnsecuredRevolvingCreditFacilityMember2021-12-310001553079us-gaap:MortgagesMemberesrt:FixedRateDebtFirstStamfordPlaceFirstLienMember2022-09-300001553079us-gaap:MortgagesMemberesrt:FixedRateDebtFirstStamfordPlaceSecondLienMember2022-09-3000015530792022-08-290001553079esrt:CreditFacilityMemberus-gaap:RevolvingCreditFacilityMember2022-09-300001553079us-gaap:RevolvingCreditFacilityMemberesrt:UnsecuredTermLoanMember2020-03-190001553079us-gaap:InterestRateSwapMember2022-05-310001553079esrt:TermLoansMemberus-gaap:RevolvingCreditFacilityMember2022-08-220001553079us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2022-09-300001553079us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2021-12-310001553079us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2022-07-012022-09-300001553079us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2021-07-012021-09-300001553079us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2022-01-012022-09-300001553079us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2021-01-012021-09-300001553079us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2022-01-012022-09-300001553079us-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberesrt:InterestRateSwapOneMonthLIBOR2.1485Memberus-gaap:CashFlowHedgingMember2022-09-300001553079us-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberesrt:InterestRateSwapOneMonthLIBOR2.1485Memberus-gaap:CashFlowHedgingMember2021-12-310001553079esrt:InterestRateSwapOneMonthLIBOR25000SwapNumberOneMemberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2022-09-300001553079esrt:InterestRateSwapOneMonthLIBOR25000SwapNumberOneMemberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2021-12-310001553079esrt:InterestRateSwapOneMonthLIBOR25000SwapNumberTwoMemberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2022-09-300001553079esrt:InterestRateSwapOneMonthLIBOR25000SwapNumberTwoMemberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2021-12-310001553079esrt:InterestRateSwapOneMonthLIBOR17570InterestSwapMemberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2022-09-300001553079esrt:InterestRateSwapOneMonthLIBOR17570InterestSwapMemberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2021-12-310001553079esrt:InterestRateSwapOneMonthLIBOR22540Memberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2022-09-300001553079esrt:InterestRateSwapOneMonthLIBOR22540Memberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2021-12-310001553079esrt:InterestRateCapOneMonthLIBOR45000Memberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2022-09-300001553079esrt:InterestRateCapOneMonthLIBOR45000Memberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2021-12-310001553079esrt:InterestRateCapOneMonthLIBOR55000Memberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2022-09-300001553079esrt:InterestRateCapOneMonthLIBOR55000Memberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2021-12-310001553079us-gaap:DesignatedAsHedgingInstrumentMemberesrt:InterestRateSwapSOFRCompound25620Memberus-gaap:SecuredOvernightFinancingRateSofrOvernightIndexSwapRateMemberus-gaap:CashFlowHedgingMember2022-09-300001553079us-gaap:DesignatedAsHedgingInstrumentMemberesrt:InterestRateSwapSOFRCompound25620Memberus-gaap:SecuredOvernightFinancingRateSofrOvernightIndexSwapRateMemberus-gaap:CashFlowHedgingMember2021-12-310001553079esrt:InterestRateSwapSOFRCompound26260Memberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:SecuredOvernightFinancingRateSofrOvernightIndexSwapRateMemberus-gaap:CashFlowHedgingMember2022-09-300001553079esrt:InterestRateSwapSOFRCompound26260Memberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:SecuredOvernightFinancingRateSofrOvernightIndexSwapRateMemberus-gaap:CashFlowHedgingMember2021-12-310001553079esrt:InterestRateSwapSOFROISCompound26280Memberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:SecuredOvernightFinancingRateSofrOvernightIndexSwapRateMemberus-gaap:CashFlowHedgingMember2022-09-300001553079esrt:InterestRateSwapSOFROISCompound26280Memberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:SecuredOvernightFinancingRateSofrOvernightIndexSwapRateMemberus-gaap:CashFlowHedgingMember2021-12-310001553079us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2022-09-300001553079us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2021-12-310001553079us-gaap:InterestRateSwapMember2022-07-012022-09-300001553079us-gaap:InterestRateSwapMember2021-07-012021-09-300001553079us-gaap:InterestRateSwapMember2022-01-012022-09-300001553079us-gaap:InterestRateSwapMember2021-01-012021-09-300001553079us-gaap:AccumulatedGainLossCashFlowHedgeIncludingNoncontrollingInterestMemberus-gaap:InterestRateSwapMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-07-012022-09-300001553079us-gaap:AccumulatedGainLossCashFlowHedgeIncludingNoncontrollingInterestMemberus-gaap:InterestRateSwapMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-07-012021-09-300001553079us-gaap:AccumulatedGainLossCashFlowHedgeIncludingNoncontrollingInterestMemberus-gaap:InterestRateSwapMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-01-012022-09-300001553079us-gaap:AccumulatedGainLossCashFlowHedgeIncludingNoncontrollingInterestMemberus-gaap:InterestRateSwapMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-01-012021-09-300001553079us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:InterestRateSwapMember2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:InterestRateSwapMember2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel1Member2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel2Member2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel3Member2022-09-300001553079us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:MortgagesMember2022-09-300001553079us-gaap:MortgagesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:MortgagesMemberus-gaap:FairValueInputsLevel1Member2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:MortgagesMemberus-gaap:FairValueInputsLevel2Member2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:MortgagesMemberus-gaap:FairValueInputsLevel3Member2022-09-300001553079us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMemberesrt:SeriesASeriesBSeriesCSeriesDSeriesESeriesFSeriesGAndSeriesHSeniorUnsecuredNotesMember2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:SeniorNotesMemberesrt:SeriesASeriesBSeriesCSeriesDSeriesESeriesFSeriesGAndSeriesHSeniorUnsecuredNotesMember2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:SeniorNotesMemberesrt:SeriesASeriesBSeriesCSeriesDSeriesESeriesFSeriesGAndSeriesHSeniorUnsecuredNotesMemberus-gaap:FairValueInputsLevel1Member2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:SeniorNotesMemberesrt:SeriesASeriesBSeriesCSeriesDSeriesESeriesFSeriesGAndSeriesHSeniorUnsecuredNotesMemberus-gaap:FairValueInputsLevel2Member2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:SeniorNotesMemberus-gaap:FairValueInputsLevel3Memberesrt:SeriesASeriesBSeriesCSeriesDSeriesESeriesFSeriesGAndSeriesHSeniorUnsecuredNotesMember2022-09-300001553079us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMemberesrt:UnsecuredTermLoanMember2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMemberesrt:UnsecuredTermLoanMember2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMemberesrt:UnsecuredTermLoanMemberus-gaap:FairValueInputsLevel1Member2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMemberesrt:UnsecuredTermLoanMemberus-gaap:FairValueInputsLevel2Member2022-09-300001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMemberus-gaap:FairValueInputsLevel3Memberesrt:UnsecuredTermLoanMember2022-09-300001553079us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:InterestRateSwapMember2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:InterestRateSwapMember2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel1Member2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel2Member2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel3Member2021-12-310001553079us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:MortgagesMember2021-12-310001553079us-gaap:MortgagesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:MortgagesMemberus-gaap:FairValueInputsLevel1Member2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:MortgagesMemberus-gaap:FairValueInputsLevel2Member2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:MortgagesMemberus-gaap:FairValueInputsLevel3Member2021-12-310001553079us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMemberesrt:SeriesASeriesBSeriesCSeriesDSeriesESeriesFSeriesGAndSeriesHSeniorUnsecuredNotesMember2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:SeniorNotesMemberesrt:SeriesASeriesBSeriesCSeriesDSeriesESeriesFSeriesGAndSeriesHSeniorUnsecuredNotesMember2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:SeniorNotesMemberesrt:SeriesASeriesBSeriesCSeriesDSeriesESeriesFSeriesGAndSeriesHSeniorUnsecuredNotesMemberus-gaap:FairValueInputsLevel1Member2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:SeniorNotesMemberesrt:SeriesASeriesBSeriesCSeriesDSeriesESeriesFSeriesGAndSeriesHSeniorUnsecuredNotesMemberus-gaap:FairValueInputsLevel2Member2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:SeniorNotesMemberus-gaap:FairValueInputsLevel3Memberesrt:SeriesASeriesBSeriesCSeriesDSeriesESeriesFSeriesGAndSeriesHSeniorUnsecuredNotesMember2021-12-310001553079us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMemberesrt:UnsecuredTermLoanMember2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMemberesrt:UnsecuredTermLoanMember2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMemberesrt:UnsecuredTermLoanMemberus-gaap:FairValueInputsLevel1Member2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMemberesrt:UnsecuredTermLoanMemberus-gaap:FairValueInputsLevel2Member2021-12-310001553079us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMemberus-gaap:FairValueInputsLevel3Memberesrt:UnsecuredTermLoanMember2021-12-31esrt:property0001553079esrt:NewYorkStateSupremeCourtNewYorkCountyMember2014-10-012014-10-31esrt:participant0001553079esrt:NewYorkStateSupremeCourtNewYorkCountyMember2020-08-262020-08-260001553079us-gaap:CommonClassAMember2022-09-300001553079us-gaap:CommonClassBMember2022-09-300001553079esrt:OtherPartnersCertainDirectorsOfficersAndOtherMembersOfExecutiveManagementMember2022-09-300001553079esrt:EmpireStateRealtyTrustMember2022-09-300001553079esrt:EmpireStateRealtyOPMemberesrt:OtherPartnersCertainDirectorsOfficersAndOtherMembersOfExecutiveManagementMember2022-01-012022-09-300001553079esrt:A2019PlanMember2019-05-1600015530792022-07-012022-07-3100015530792022-07-3100015530792022-08-012022-08-3100015530792022-08-3100015530792022-09-012022-09-300001553079esrt:PrivatePerpetualPreferredUnitsSeries2014Member2022-01-012022-09-300001553079esrt:A2019PlanMember2022-09-300001553079srt:MinimumMemberesrt:TimeBasedLongTermIncentivePlanUnitMember2022-01-012022-09-300001553079srt:MedianMemberesrt:TimeBasedLongTermIncentivePlanUnitMember2022-01-012022-09-300001553079srt:MaximumMemberesrt:TimeBasedLongTermIncentivePlanUnitMember2022-01-012022-09-300001553079esrt:GrantedIn2020AndAfterMember2022-01-012022-09-300001553079esrt:GrantedBefore2020Member2022-01-012022-09-300001553079esrt:TimeBasedLongTermIncentivePlanUnitMember2022-01-012022-09-300001553079srt:MinimumMemberesrt:MarketBasedLongTermIncentivePlanUnitMember2022-01-012022-09-300001553079srt:MaximumMemberesrt:MarketBasedLongTermIncentivePlanUnitMember2022-01-012022-09-300001553079esrt:LongTermIncentivePlanUnitsandRestrictedStockMember2022-01-012022-09-300001553079srt:MinimumMemberesrt:LongTermIncentivePlanUnitsandRestrictedStockMember2022-01-012022-09-300001553079esrt:LongTermIncentivePlanUnitsandRestrictedStockMembersrt:MaximumMember2022-01-012022-09-300001553079us-gaap:RestrictedStockMember2021-12-310001553079esrt:TimeBasedLongTermIncentivePlanUnitMember2021-12-310001553079esrt:MarketBasedLongTermIncentivePlanUnitMember2021-12-310001553079esrt:PerformanceBasedLongTermIncentivePlanUnitMember2021-12-310001553079us-gaap:RestrictedStockMember2022-01-012022-09-300001553079esrt:MarketBasedLongTermIncentivePlanUnitMember2022-01-012022-09-300001553079esrt:PerformanceBasedLongTermIncentivePlanUnitMember2022-01-012022-09-300001553079us-gaap:RestrictedStockMember2022-09-300001553079esrt:TimeBasedLongTermIncentivePlanUnitMember2022-09-300001553079esrt:MarketBasedLongTermIncentivePlanUnitMember2022-09-300001553079esrt:PerformanceBasedLongTermIncentivePlanUnitMember2022-09-300001553079srt:MinimumMember2022-01-012022-09-300001553079srt:MaximumMember2022-01-012022-09-300001553079esrt:AwardsthatMeetAgeandServiceRequirementsforVestingMember2022-07-012022-09-300001553079esrt:AwardsthatMeetAgeandServiceRequirementsforVestingMember2022-01-012022-09-300001553079esrt:AwardsthatMeetAgeandServiceRequirementsforVestingMember2021-07-012021-09-300001553079esrt:AwardsthatMeetAgeandServiceRequirementsforVestingMember2021-01-012021-09-300001553079esrt:AwardsthatMeetAgeandServiceRequirementsforVestingMember2022-09-300001553079esrt:AwardsthatDoNotMeetAgeandServiceRequirementsforVestingMember2022-07-012022-09-300001553079esrt:AwardsthatDoNotMeetAgeandServiceRequirementsforVestingMember2022-01-012022-09-300001553079esrt:AwardsthatDoNotMeetAgeandServiceRequirementsforVestingMember2021-07-012021-09-300001553079esrt:AwardsthatDoNotMeetAgeandServiceRequirementsforVestingMember2021-01-012021-09-300001553079esrt:AwardsthatDoNotMeetAgeandServiceRequirementsforVestingMember2022-09-300001553079srt:AffiliatedEntityMemberesrt:SupervisoryFeeRevenueMember2022-07-012022-09-300001553079srt:AffiliatedEntityMemberesrt:SupervisoryFeeRevenueMember2021-07-012021-09-300001553079srt:AffiliatedEntityMemberesrt:SupervisoryFeeRevenueMember2022-01-012022-09-300001553079srt:AffiliatedEntityMemberesrt:SupervisoryFeeRevenueMember2021-01-012021-09-300001553079esrt:PropertyManagementFeeRevenueMembersrt:AffiliatedEntityMember2022-07-012022-09-300001553079esrt:PropertyManagementFeeRevenueMembersrt:AffiliatedEntityMember2021-07-012021-09-300001553079esrt:PropertyManagementFeeRevenueMembersrt:AffiliatedEntityMember2022-01-012022-09-300001553079esrt:PropertyManagementFeeRevenueMembersrt:AffiliatedEntityMember2021-01-012021-09-300001553079us-gaap:UndividedInterestMember2022-09-300001553079esrt:LeasedSpaceRentalMembersrt:AffiliatedEntityMember2022-09-300001553079esrt:LeasedSpaceRentalMembersrt:AffiliatedEntityMember2022-01-012022-09-300001553079esrt:LeasedSpaceRentalMemberesrt:BoardofDirectorsChairmanEmeritusMember2022-01-012022-09-300001553079esrt:LeasedSpaceRentalMembersrt:AffiliatedEntityMember2022-07-012022-09-300001553079esrt:LeasedSpaceRentalMembersrt:AffiliatedEntityMember2021-07-012021-09-300001553079esrt:LeasedSpaceRentalMembersrt:AffiliatedEntityMember2021-01-012021-09-30esrt:segment0001553079us-gaap:OperatingSegmentsMemberesrt:RealEstateSegmentMember2022-07-012022-09-300001553079esrt:ObservatorySegmentMemberus-gaap:OperatingSegmentsMember2022-07-012022-09-300001553079us-gaap:IntersegmentEliminationMember2022-07-012022-09-300001553079us-gaap:OperatingSegmentsMemberesrt:RealEstateSegmentMember2022-09-300001553079esrt:ObservatorySegmentMemberus-gaap:OperatingSegmentsMember2022-09-300001553079us-gaap:IntersegmentEliminationMember2022-09-300001553079us-gaap:OperatingSegmentsMemberesrt:RealEstateSegmentMember2021-07-012021-09-300001553079esrt:ObservatorySegmentMemberus-gaap:OperatingSegmentsMember2021-07-012021-09-300001553079us-gaap:IntersegmentEliminationMember2021-07-012021-09-300001553079us-gaap:OperatingSegmentsMemberesrt:RealEstateSegmentMember2021-09-300001553079esrt:ObservatorySegmentMemberus-gaap:OperatingSegmentsMember2021-09-300001553079us-gaap:IntersegmentEliminationMember2021-09-300001553079us-gaap:OperatingSegmentsMemberesrt:RealEstateSegmentMember2022-01-012022-09-300001553079esrt:ObservatorySegmentMemberus-gaap:OperatingSegmentsMember2022-01-012022-09-300001553079us-gaap:IntersegmentEliminationMember2022-01-012022-09-300001553079us-gaap:OperatingSegmentsMemberesrt:RealEstateSegmentMember2021-01-012021-09-300001553079esrt:ObservatorySegmentMemberus-gaap:OperatingSegmentsMember2021-01-012021-09-300001553079us-gaap:IntersegmentEliminationMember2021-01-012021-09-30

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q 

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

For the Quarterly Period Ended September 30, 2022

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

For the transition period from             to            

Commission File Number: 001-36106

EMPIRE STATE REALTY OP, L.P.

(Exact name of Registrant as specified in its charter)  

Delaware						45-4685158
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

111 West 33rd Street, 12th Floor

New York, New York 10120

(Address of principal executive offices) (Zip Code)

[phone]

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

    

Title of Securities			Trading Symbol			Exchange on which traded
Series ES operating partnership units			ESBA			NYSE Arca, Inc.
Series 60 operating partnership units			OGCP			NYSE Arca, Inc.
Series 250 operating partnership units			FISK			NYSE Arca, Inc.

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.    Yes   ☒    No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒     No   ☐

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 definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer			☒			Accelerated filer			☐
Non-accelerated filer			☐			Smaller reporting company			☐
						Emerging growth company			☐

    If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

    Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   Yes  ☐  No  ☒

    As of October 28, 2022, there were 21,319,214 units of the Registrant Series ES operating partnership units outstanding, 5,647,217 units of the Series 60 operating partnership units outstanding, and 2,816,767 units of the Series 250 operating partnership units outstanding.

---

			EMPIRE STATE REALTY OP, L.P.
			FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2022
			TABLE OF CONTENTS			PAGE
PART 1.			FINANCIAL INFORMATION
ITEM 1.			FINANCIAL STATEMENTS
			Condensed Consolidated Balance Sheets as of September 30, 2022 (unaudited) and December 31, 2021			2
			Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2022 and 2021 (unaudited)			3
			Condensed Consolidated Statements of Comprehensive Income (Loss) for the three and nine months ended September 30, 2022 and 2021 (unaudited)			4
			Condensed Consolidated Statements of Capital for the three and nine months ended September 30, 2022 and 2021 (unaudited)			5
			Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2022 and 2021 (unaudited)			7
			Notes to Condensed Consolidated Financial Statements (unaudited)			9
ITEM 2.			MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			28
ITEM 3.			QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK			41
ITEM 4.			CONTROLS AND PROCEDURES			41
PART II.			OTHER INFORMATION			41
ITEM 1.			LEGAL PROCEEDINGS			41
ITEM 1A.			RISK FACTORS			42
ITEM 2.			UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS			42
ITEM 3.			DEFAULTS UPON SENIOR SECURITIES			42
ITEM 4.			MINE SAFETY DISCLOSURES			42
ITEM 5.			OTHER INFORMATION			42
ITEM 6.			EXHIBITS			43
SIGNATURES						44

1

---

ITEM 1. FINANCIAL STATEMENTS

Empire State Realty OP, L.P.

Condensed Consolidated Balance Sheets

(amounts in thousands, except per unit amounts)

			September 30, 2022						December 31, 2021
ASSETS			(unaudited)
Commercial real estate properties, at cost:
Land			$	334,598					$	336,278
Development costs			8,162						8,131
Building and improvements			3,194,787						3,156,508
			3,537,547						3,500,917
Less: accumulated depreciation			(1,159,364)						(1,072,938)
Commercial real estate properties, net			2,378,183						2,427,979
Cash and cash equivalents			387,248						423,695
Restricted cash			52,567						50,943
Tenant and other receivables			30,547						18,647
Deferred rent receivables			239,750						224,922
Prepaid expenses and other assets			72,905						76,549
Deferred costs, net			188,706						202,437
Acquired below-market ground leases, net			331,030						336,904
Right of use assets			28,725						28,892
Goodwill			491,479						491,479
Total assets			$	4,201,140					$	4,282,447
LIABILITIES AND CAPITAL
Liabilities:
Mortgage notes payable, net			$	915,202					$	948,769
Senior unsecured notes, net			973,607						973,373
Unsecured term loan facilities, net			388,645						388,223
Unsecured revolving credit facility			—						—
Accounts payable and accrued expenses			94,436						120,810
Acquired below-market leases, net			18,897						24,941
Ground lease liabilities			28,725						28,892
Deferred revenue and other liabilities			80,249						84,358
Tenants’ security deposits			27,550						28,749
Total liabilities			2,527,311						2,598,115
Commitments and contingencies
Capital:
Private perpetual preferred units:
Private perpetual preferred units, $13.52 liquidation preference, 4,664 issued and outstanding in 2022 and 2021, respectively			21,936						21,936
Private perpetual preferred units, $16.62 liquidation preference, 1,560 issued and outstanding in 2022 and 2021			8,004						8,004
Series PR operating partnership units:
ESRT partner's capital (2,725 and 2,812 general partner operating partnership units and 158,844 and 167,405 limited partner operating partnership units outstanding in 2022 and 2021, respectively)			952,379						998,128
Limited partners' interests (81,034 and 79,820 limited partner operating partnership units outstanding in 2022 and 2021, respectively)			675,818						649,157
Series ES operating partnership units (21,422 and 22,321 limited partner operating partnership units outstanding in 2022 and 2021, respectively)			470						(4,058)
Series 60 operating partnership units (5,678 and 5,885 limited partner operating partnership units outstanding in 2022 and 2022, respectively)			(223)						(1,395)
Series 250 operating partnership units (2,824 and 2,971 limited partner operating partnership units outstanding in 2022 and 2021, respectively)			(57)						(692)
Total Empire State Realty OP, L.P.'s capital			1,658,327						1,671,080
Non-controlling interest in other partnerships			15,502						13,252
Total capital			1,673,829						1,684,332
Total liabilities and capital			$	4,201,140					$	4,282,447

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

2

---

Empire State Realty OP, L.P.

Condensed Consolidated Statements of Operations

(unaudited)

(amounts in thousands, except per unit amounts)

			Three Months Ended September 30,												Nine Months Ended September 30,
			2022						2021						2022						2021
Revenues:
Rental revenue			$	148,290					$	139,558					$	445,143					$	420,586
Observatory revenue			33,051						12,796						73,660						23,758
Lease termination fees			—						11,321						20,032						15,949
Third-party management and other fees			389						314						1,025						917
Other revenue and fees			1,982						1,059						5,908						2,550
Total revenues			183,712						165,048						545,768						463,760
Operating expenses:
Property operating expenses			42,798						33,357						118,875						92,429
Ground rent expenses			2,331						2,331						6,994						6,994
General and administrative expenses			15,725						14,427						45,287						42,369
Observatory expenses			8,516						6,370						22,507						16,226
Real estate taxes			31,831						29,566						91,637						92,367
Depreciation and amortization			46,984						65,794						172,394						155,339
Total operating expenses			148,185						151,845						457,694						405,724
Total operating income			35,527						13,203						88,074						58,036
Other income (expense):
Interest income			1,564						211						2,144						497
Interest expense			(25,516)						(23,577)						(75,572)						(70,553)
Loss on early extinguishment of debt			—						—						—						(214)
Gain on disposition of property			—						—						27,170						—
Income (loss) before income taxes			11,575						(10,163)						41,816						(12,234)
Income tax (expense) benefit			(1,457)						(20)						(224)						3,271
Net income (loss)			10,118						(10,183)						41,592						(8,963)
Private perpetual preferred unit distributions			(1,050)						(1,050)						(3,151)						(3,151)
Net loss attributable to non-controlling interest in other partnerships			49						—						271						—
Net income (loss) attributable to common unitholders			$	9,117					$	(11,233)					$	38,712					$	(12,114)
Total weighted average units:
Basic			266,035						277,716						269,880						277,829
Diluted			267,121						277,716						270,966						277,829
Earnings per unit attributable to common unitholders:
Basic			$	0.03					$	(0.04)					$	0.14					$	(0.04)
Diluted			$	0.03					$	(0.04)					$	0.14					$	(0.04)
Dividends per unit			$	0.035					$	0.035					$	0.105					$	0.070

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

3

---

Empire State Realty OP, L.P.

Condensed Consolidated Statements of Comprehensive Income (Loss)

(unaudited)

(amounts in thousands)

			Three Months Ended September 30,												Nine Months Ended September 30,
			2022						2021						2022						2021
Net income (loss)			$	10,118					$	(10,183)					$	41,592					$	(8,963)
Other comprehensive income:
Unrealized gain (loss) on valuation of interest rate swap agreements			19,588						(103)						39,407						(139)
Less: amount reclassified into interest expense			1,392						2,920						7,428						8,687
Other comprehensive income			20,980						2,817						46,835						8,548
Comprehensive income (loss)			31,098						(7,366)						88,427						(415)
Net loss attributable to non-controlling interest in other partnerships			49						—						271						—
Other comprehensive income attributable to non-controlling interest			(670)						—						(2,297)						—
Comprehensive income (loss) attributable to OP unitholders			$	30,477					$	(7,366)					$	86,401					$	(415)

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

4

---

Empire State Realty OP, L.P.

Condensed Consolidated Statements of Capital

For The Three Months Ended September 30, 2022 and 2021

(unaudited)

(amounts in thousands)

															Series PR Operating Partnership Units																								Series ES Operating Partnership Units Limited Partners												Series 60 Operating Partnership Units Limited Partners												Series 250 Operating Partnership Units Limited Partners
															General Partner												Limited Partners
			Private Perpetual Preferred Units						Private Perpetual Preferred Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Non-controlling Interest in Other Partnerships						Total Capital
Balance at June 30, 2022			6,224						$	29,940					163,684						$	957,803					81,073						$	665,520					21,746						$	(1,137)					5,738						$	(637)					2,862						$	(277)					14,881						$	1,666,093
Issuance of OP units, net of costs			—						—						—						—						—						—						—						—						—						—						—						—						—						—
Conversion of operating partnership units to ESRT Partner's Capital			—						—						461						39						(39)						(4)						(324)						(27)						(60)						(5)						(38)						(3)						—						—
Contributions from consolidated joint ventures			—						—						—						—						—						—						—						—						—						—						—						—						—						—
Repurchases of common shares			—						—						(2,567)						(18,105)						—						—						—						—						—						—						—						—						—						(18,105)
Equity compensation			—						—						(8)						317						—						5,057						—						—						—						—						—						—						—						5,374
Distributions			—						(1,050)						—						(5,694)						—						(2,837)						—						(751)						—						(199)						—						(100)						—						(10,631)
Net income			—						1,050						—						5,557						—						2,529						—						739						—						192						—						100						(49)						10,118
Other comprehensive income (loss)			—						—						—						12,462						—						5,553						—						1,646						—						426						—						223						670						20,980
Balance at September 30, 2022			6,224						$	29,940					161,570						$	952,379					81,034						$	675,818					21,422						$	470					5,678						$	(223)					2,824						$	(57)					$	15,502					$	1,673,829

															Series PR Operating Partnership Units																								Series ES Operating Partnership Units Limited Partners												Series 60 Operating Partnership Units Limited Partners												Series 250 Operating Partnership Units Limited Partners
															General Partner												Limited Partners
			Private Perpetual Preferred Units						Private Perpetual Preferred Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Non-controlling Interest in Other Partnerships						Total Capital
Balance at June 30, 2021			6,224						$	29,940					173,400						$	1,055,659					80,241						$	650,473					22,923						$	(1,692)					6,112						$	(789)					3,045						$	(383)					$	—					$	1,733,208
Issuance of OP units, net of costs			—						—						—						—						—						—						—						—						—						—						—						—						—						—
Conversion of operating partnership units to ESRT Partner's Capital			—						—						542						931						(119)						(960)						(312)						17						(93)						10						(18)						2						—						—
Repurchases of common shares			—						—						(626)						(6,510)						—						—						—						—						—						—						—						—						—						(6,510)
Equity compensation			—						—						(24)						180						33						5,198						—						—						—						—						—						—						—						5,378
Distributions			—						(1,050)						—						(6,061)						—						(2,806)						—						(795)						—						(211)						—						(106)						—						(11,029)
Net income			—						1,050						—						(6,977)						—						(2,954)						—						(931)						—						(248)						—						(123)						—						(10,183)
Other comprehensive income (loss)			—						—						—						1,756						—						739						—						229						—						62						—						31						—						2,817
Balance at September 30, 2021			6,224						$	29,940					173,292						$	1,038,978					80,155						$	649,690					22,611						$	(3,172)					6,019						$	(1,176)					3,027						$	(579)					$	—					$	1,713,681

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

5

---

Empire State Realty OP, L.P.

Condensed Consolidated Statements of Capital

For The Nine Months Ended September 30, 2022 and 2021

(unaudited)

(amounts in thousands)

															Series PR Operating Partnership Units																								Series ES Operating Partnership Units Limited Partners												Series 60 Operating Partnership Units Limited Partners												Series 250 Operating Partnership Units Limited Partners
															General Partner												Limited Partners
			Private Perpetual Preferred Units						Private Perpetual Preferred Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Non-controlling Interest in Other Partnerships						Total Capital
Balance at December 31, 2021			6,224						$	29,940					170,217						$	998,128					79,820						$	649,157					22,321						$	(4,058)					5,884						$	(1,395)					2,970						$	(692)					$	13,252					$	1,684,332
Conversion of operating partnership units to ESRT Partner's Capital			—						—						1,599						2,384						(348)						(2,503)						(899)						69						(206)						28						(146)						22						—						—
Contributions from consolidated joint ventures			—						—						—						—						—						—						—						—						—						—						—						—						224						224
Repurchases of common units			—						—						(10,433)						(82,545)						—						—						—						—						—						—						—						—						—						(82,545)
Equity compensation			—						—						187						574						1,562						15,025						—						—						—						—						—						—						—						15,599
Distributions			—						(3,151)						—						(17,444)						—						(8,421)						—						(2,285)						—						(604)						—						(303)						—						(32,208)
Net income (loss)			—						3,151						—						23,847						—						10,490						—						3,136						—						813						—						426						(271)						41,592
Other comprehensive income			—						—						—						27,435						—						12,070						—						3,608						—						935						—						490						2,297						46,835
Balance at September 30, 2022			6,224						$	29,940					161,570						$	952,379					81,034						$	675,818					21,422						$	470					5,678						$	(223)					2,824						$	(57)					$	15,502					$	1,673,829

															Series PR Operating Partnership Units																								Series ES Operating Partnership Units Limited Partners												Series 60 Operating Partnership Units Limited Partners												Series 250 Operating Partnership Units Limited Partners
															General Partner												Limited Partners
			Private Perpetual Preferred Units						Private Perpetual Preferred Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Operating Partnership Units						Operating Partnership Unitholders						Non-controlling Interest in Other Partnerships						Total Capital
Balance at December 31, 2020			6,224						$	29,940					171,565						$	1,055,249					80,355						$	648,543					23,678						$	(1,348)					6,424						$	(721)					3,255						$	(356)					—						$	1,731,307
Conversion of operating partnership units to ESRT Partner's Capital			—						—						2,682						7,766						(982)						(7,918)						(1,067)						72						(405)						50						(228)						30						—						—
Repurchases of common units			—						—						(1,009)						(10,043)						—						—						—						—						—						—						—						—						—						(10,043)
Equity compensation			—						—						54						344						782						15,072						—						—						—						—						—						—						—						15,416
Distributions			—						(3,151)						—						(12,124)						—						(5,068)						—						(1,601)						—						(426)						—						(214)						—						(22,584)
Net income (loss)			—						3,151						—						(7,523)						—						(3,186)						—						(1,005)						—						(267)						—						(133)						—						(8,963)
Other comprehensive income			—						—						—						5,309						—						2,247						—						710						—						188						—						94						—						8,548
Balance at September 30, 2021			6,224						$	29,940					173,292						$	1,038,978					80,155						$	649,690					22,611						$	(3,172)					6,019						$	(1,176)					3,027						$	(579)					$	—					$	1,713,681

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

6

---

Empire State Realty OP, L.P.

Condensed Consolidated Statements of Cash Flows

(unaudited)

(amounts in thousands)

			Nine Months Ended September 30,
			2022						2021
Cash Flows From Operating Activities
Net income (loss)			$	41,592					$	(8,963)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization			172,394						155,339
Gain on disposition of property			(27,170)						—
Amortization of non-cash items within interest expense			7,514						7,978
Amortization of acquired above- and below-market leases, net			(4,136)						(5,615)
Amortization of acquired below-market ground leases			5,873						5,873
Straight-lining of rental revenue			(18,533)						(13,197)
Equity based compensation			15,599						15,416
Loss on early extinguishment of debt			—						214
Increase (decrease) in cash flows due to changes in operating assets and liabilities:
Security deposits			(1,198)						(4,366)
Tenant and other receivables			(11,707)						(123)
Deferred leasing costs			(31,983)						(12,324)
Prepaid expenses and other assets			23,630						18,660
Accounts payable and accrued expenses			2,511						(1,285)
Deferred revenue and other liabilities			(401)						9,420
Net cash provided by operating activities			173,985						167,027
Cash Flows From Investing Activities
Development costs			(31)						(41)
Additions to building and improvements			(89,085)						(70,719)
Net cash used in investing activities			(89,116)						(70,760)

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

7

---

Empire State Realty OP, L.P.

Condensed Consolidated Statements of Cash Flows (continued)

(unaudited)

(amounts in thousands)

			Nine Months Ended September 30,
			2022						2021
Cash Flows From Financing Activities
Repayment of mortgage notes payable			(5,163)						(3,053)
Deferred financing costs			—						(7,559)
Contributions from consolidated joint ventures			224						—
Repurchases of common units			(82,545)						(10,043)
Distributions			(32,208)						(22,584)
Net cash used in financing activities			(119,692)						(43,239)
Net increase (decrease) in cash and cash equivalents and restricted cash			(34,823)						53,028
Cash and cash equivalents and restricted cash—beginning of period			474,638						567,939
Cash and cash equivalents and restricted cash—end of period			$	439,815					$	620,967
Reconciliation of Cash and Cash Equivalents and Restricted Cash:
Cash and cash equivalents at beginning of period			$	423,695					$	526,714
Restricted cash at beginning of period			50,943						41,225
Cash and cash equivalents and restricted cash at beginning of period			$	474,638					$	567,939
Cash and cash equivalents at end of period			$	387,248					$	582,188
Restricted cash at end of period			52,567						38,779
Cash and cash equivalents and restricted cash at end of period			$	439,815					$	620,967
Supplemental disclosures of cash flow information:
Cash paid for interest			$	67,673					$	58,208
Cash paid for income taxes			$	188					$	472
Non-cash investing and financing activities:
Building and improvements included in accounts payable and accrued expenses			$	55,320					$	53,956
Write-off of fully depreciated assets			55,585						10,798
Derivative instruments at fair values included in prepaid expenses and other assets			18,457						—
Derivative instruments at fair values included in accounts payable and accrued expenses			—						4,887
Conversion of operating partnership units to ESRT partner's capital			2,384						7,766
Disposal of land in connection with foreclosure			1,680						—
Extinguishment of debt in connection with property disposition			30,000						—

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

8

---

Empire State Realty OP, L.P.

Notes to Condensed Consolidated Financial Statements

(unaudited)

1. Description of Business and Organization

    As used in these condensed consolidated financial statements, unless the context otherwise requires, “we,” “us,” "our," and the "company,” mean Empire State Realty OP, L.P. and its consolidated subsidiaries.

    Empire State Realty OP, L.P. (the "Operating Partnership") is the entity through which Empire State Realty Trust, Inc. (“ESRT”), a self-administered and self-managed real estate investment trust ("REIT"), conducts all of its business and owns (either directly or through subsidiaries) substantially all of its assets. We own and manage a well-positioned property portfolio of office, retail and multifamily assets in Manhattan and the greater New York metropolitan area. As the owner of the Empire State Building, the World’s Most Famous Building, ESRT also owns and operates its iconic, newly reimagined Observatory Experience. As of September 30, 2022, our total portfolio contained 9.9 million rentable square feet of office and retail space. We owned 13 office properties (including three long-term ground leasehold interests) encompassing approximately 9.2 million rentable square feet of office space. Nine of these properties are located in the midtown Manhattan market and aggregate approximately 7.6 million rentable square feet of office space, including the Empire State Building. Our Manhattan office properties also contain an aggregate of approximately 0.5 million rentable square feet of retail space on their ground floor and/or contiguous levels. Our remaining four office properties are located in Fairfield County, Connecticut and Westchester County, New York, encompassing in the aggregate approximately 1.6 million rentable square feet. The majority of square footage for these four properties is located in densely populated metropolitan communities with immediate access to mass transportation. Additionally, we have entitled land at the Stamford Transportation Center in Stamford, Connecticut, adjacent to one of our office properties, that will support the development of an approximately 0.4 million rentable square foot office building and garage. As of September 30, 2022, our portfolio included four standalone retail properties located in Manhattan and two standalone retail properties located in the city center of Westport, Connecticut, encompassing approximately 0.2 million rentable square feet in the aggregate. Additionally, at September 30, 2022, our portfolio included two multifamily properties totaling 625 units.

    We were organized as a Delaware limited partnership on November 28, 2011 and operations commenced upon completion of the initial public offering of ESRT’s Class A common stock and related formation transactions on October 7, 2013. ESRT, as the sole general partner in our company, has responsibility and discretion in the management and control of our company, and our limited partners, in such capacity, have no authority to transact business for, or participate in the management activities, of our company. As of September 30, 2022, ESRT owned approximately 59.3% of our operating partnership units.

2. Summary of Significant Accounting Policies

    There have been no material changes to the summary of significant accounting policies included in the section entitled "Summary of Significant Accounting Policies" in our December 31, 2021 Annual Report on Form 10-K.

Basis of Quarterly Presentation and Principles of Consolidation

    The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”), for interim financial information, and with the rules and regulations of the Securities and Exchange Commission (the "SEC"). Accordingly, certain information and footnote disclosures required by GAAP for complete financial statements have been condensed or omitted in accordance with such rules and regulations. In the opinion of management, all adjustments and eliminations (including intercompany balances and transactions), consisting of normal recurring adjustments, considered necessary for the fair presentation of the financial statements have been included.

    The results of operations for the periods presented are not necessarily indicative of the results that may be expected for the corresponding full years. These financial statements should be read in conjunction with the financial statements and accompanying notes included in the financial statements for the year ended December 31, 2021 contained in our Annual Report on Form 10-K. We do not consider our business to be subject to material seasonal fluctuations, except that our observatory business is subject to tourism seasonality. Prior to the outbreak of COVID-19, approximately 16.0% to 18.0% of our annual observatory revenue was realized in the first quarter, 26.0% to 28.0% was realized in the second quarter, 31.0% to 33.0% was realized in the third quarter and 23.0% to 25.0% was realized in the fourth quarter.

9

---

    We consolidate entities in which we have a controlling financial interest.  In determining whether we have a controlling financial interest in a partially owned entity and the requirement to consolidate the accounts of that entity, we consider factors such as ownership interest, board representation, management representation, authority to make decisions, and contractual and substantive participating rights of the partners/members.  For variable interest entities ("VIE"), we consolidate the entity if we are deemed to have a variable interest in the entity and through that interest we are deemed 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. The primary beneficiary is required to consolidate the VIE. We had no VIEs as of September 30, 2022 and December 31, 2021.

    We will assess the accounting treatment for each investment we may have in the future. This assessment will include a review of each entity’s organizational agreement to determine which party has what rights and whether those rights are protective or participating. For all VIEs, we will 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 and benefit. In situations where we or our partner could approve, among other things, the annual budget, or leases that cover more than a nominal amount of space relative to the total rentable space at each property, we would not consolidate the investment as we consider these to be substantive participation rights that result in shared power of the activities that would most significantly impact the performance and benefit of such joint venture investment.

    A non-controlling 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. Non-controlling interests are required to be presented as a separate component of equity in the condensed consolidated balance sheets and in the condensed consolidated statements of operations by requiring earnings and other comprehensive income to be attributed to controlling and non-controlling interests.

Accounting Estimates

    The preparation of the condensed consolidated financial statements in accordance with GAAP requires management to use estimates and assumptions that in certain circumstances affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Significant items subject to such estimates and assumptions include allocation of the purchase price of acquired real estate properties among tangible and intangible assets, determination of the useful life of real estate properties and other long-lived assets, valuation and impairment analysis of commercial real estate properties, right of use assets and other long-lived and indefinite lived assets, estimate of tenant expense reimbursements, valuation of the allowance for doubtful accounts, and valuation of derivative instruments, ground lease liabilities, senior unsecured notes, mortgage notes payable, unsecured term loan and revolving credit facilities, and equity based compensation. These estimates are prepared using management’s best judgment, after considering past, current, and expected events and economic conditions. Actual results could differ from those estimates.     

3. Property Disposition

During April 2022, we transferred 383 Main Avenue, Norwalk CT, which was encumbered by a $30.0 million mortgage, back to the lender in a consensual foreclosure and recognized a non-cash gain of $27.2 million, which is included in Gain on disposition of property in our condensed consolidated statements of operations. In December 2021, we recorded a $7.7 million impairment charge on the property as we had concluded the cost basis of the asset exceeded its fair value given our reduced holding period and new intent to transfer property ownership to the lender.

Subsequent to September 30, 2022, we entered into agreements to sell 500 Mamaroneck Avenue in Harrison, NY and 10 Bank Street in White Plains, NY at a gross asset valuation of $95.0 million. These transactions are expected to close in the first quarter of 2023, subject to customary closing conditions.

4. Deferred Costs, Acquired Lease Intangibles and Goodwill

    Deferred costs, net, consisted of the following as of September 30, 2022 and December 31, 2021 (amounts in thousands):  

10

---

			September 30, 2022						December 31, 2021
Leasing costs			$	218,552					$	211,189
Acquired in-place lease value and deferred leasing costs			158,286						166,491
Acquired above-market leases			28,123						33,289
			404,961						410,969
Less: accumulated amortization			(221,751)						(215,764)
Total deferred costs, net, excluding net deferred financing costs			$	183,210					$	195,205

    At September 30, 2022 and December 31, 2021, $5.5 million and $7.2 million, respectively, of net deferred financing costs associated with the unsecured revolving credit facility was included in deferred costs, net on the condensed consolidated balance sheets.

    Amortization expense related to deferred leasing costs and acquired deferred leasing costs was $5.6 million and $10.4 million for the three months ended September 30, 2022 and 2021, respectively, and $19.8 million and $22.1 million for the nine months ended September 30, 2022 and 2021, respectively. Amortization expense related to acquired lease intangibles was $2.2 million and $5.0 million for the three months ended September 30, 2022 and 2021, respectively, and $10.6 million and $8.3 million for the nine months ended September 30, 2022 and 2021, respectively.

    Amortizing acquired intangible assets and liabilities consisted of the following as of September 30, 2022 and December 31, 2021 (amounts in thousands):

			September 30, 2022						December 31, 2021
Acquired below-market ground leases			$	396,916					$	396,916
Less: accumulated amortization			(65,886)						(60,012)
Acquired below-market ground leases, net			$	331,030					$	336,904

			September 30, 2022						December 31, 2021
Acquired below-market leases			$	(64,529)					$	(65,403)
Less: accumulated amortization			45,632						40,462
Acquired below-market leases, net			$	(18,897)					$	(24,941)

    

    Rental revenue related to the amortization of below-market leases, net of above-market leases, was $0.7 million and $4.2 million for the three months ended September 30, 2022 and 2021, respectively, and $4.1 million and $5.6 million for the nine months ended September 30, 2022 and 2021, respectively.

    

    As of September 30, 2022, we had goodwill of $491.5 million. Goodwill was allocated $227.5 million to the observatory reportable segment and $264.0 million to the real estate reportable segment.

    From the quarter ended June 30, 2020 through the quarter ended June 30, 2022, we bypassed the optional qualitative goodwill impairment assessment and proceeded directly to a quantitative assessment of the observatory reportable segment and engaged a third-party valuation consulting firm to perform the valuation process. This was done in response to the closure of the observatory on March 16, 2020, due to the COVID-19 pandemic, which was subsequently fully reopened on August 24, 2020. The quantitative analysis used a combination of the discounted cash flow method (a form of the income approach) utilizing Level 3 unobservable inputs and the guideline company method (a form of the market approach). Significant assumptions under the former included revenue and cost projections, weighted average cost of capital, long-term growth rate and income tax considerations while the latter included guideline company enterprise values, revenue multiples and control premium rates. Our methodology to review goodwill impairment, which included a significant amount of judgment and estimates, provided a reasonable basis to determine whether impairment had occurred. Each quantitative analysis performed concluded the fair value of the reporting unit exceeds its carrying value. For the quarter ended September 30, 2022, we performed an optional qualitative assessment and did not identify any events which occurred between our last quantitative assessment and the current reporting date which would indicate, on a more likely than not basis, that the goodwill allocated to the reporting unit was impaired. Many of the factors employed in determining whether or not goodwill is impaired are outside

11

---

of our control, and it is reasonably likely that assumptions and estimates will change in future periods. We will continue to assess the impairment of the observatory reporting unit goodwill going forward.

5. Debt

    Debt consisted of the following as of September 30, 2022 and December 31, 2021 (amounts in thousands):

			Principal Balance												As of September 30, 2022
			September 30, 2022						December 31, 2021						Stated Rate						Effective Rate(1)						Maturity Date(2)
Mortgage debt collateralized by:
Fixed rate mortgage debt
Metro Center			$	83,213					$	85,032					3.59		%				3.67		%				11/5/2024
10 Union Square			50,000						50,000						3.70		%				3.97		%				4/1/2026
1542 Third Avenue			30,000						30,000						4.29		%				4.53		%				5/1/2027
First Stamford Place(3)			179,549						180,000						4.28		%				4.73		%				7/1/2027
1010 Third Avenue and 77 West 55th Street			36,044						36,670						4.01		%				4.21		%				1/5/2028
250 West 57th Street			180,000						180,000						2.83		%				3.21		%				12/1/2030
10 Bank Street			30,364						31,091						4.23		%				4.37		%				6/1/2032
383 Main Avenue(4)			—						30,000						—		%				—		%				—
1333 Broadway			160,000						160,000						4.21		%				4.29		%				2/5/2033
345 East 94th Street - Series A			43,600						43,600						70.0% of LIBOR plus 0.95%						3.56		%				11/1/2030
345 East 94th Street - Series B			8,021						8,650						LIBOR plus 2.24%						3.56		%				11/1/2030
561 10th Avenue - Series A			114,500						114,500						70.0% of LIBOR plus 1.07%						3.85		%				11/1/2033
561 10th Avenue - Series B			17,797						19,250						LIBOR plus 2.45%						3.85		%				11/1/2033
Total mortgage debt			933,088						968,793
Senior unsecured notes:(5)
Series A			100,000						100,000						3.93		%				3.96		%				3/27/2025
Series B			125,000						125,000						4.09		%				4.12		%				3/27/2027
Series C			125,000						125,000						4.18		%				4.21		%				3/27/2030
Series D			115,000						115,000						4.08		%				4.11		%				1/22/2028
Series E			160,000						160,000						4.26		%				4.27		%				3/22/2030
Series F			175,000						175,000						4.44		%				4.45		%				3/22/2033
Series G			100,000						100,000						3.61		%				4.89		%				3/17/2032
Series H			75,000						75,000						3.73		%				5.00		%				3/17/2035
Unsecured term loan facility (5) (6)			215,000						215,000						SOFR plus 1.20%						4.22		%				3/19/2025
Unsecured revolving credit facility (5) (6)			—						—						SOFR plus 1.30%						—						3/31/2025
Unsecured term loan facility (5) (6)			175,000						175,000						SOFR plus 1.50%						4.51		%				12/31/2026
Total principal			2,298,088						2,333,793
Deferred financing costs, net			(12,694)						(14,881)
Unamortized debt discount			(7,940)						(8,547)
Total			$	2,277,454					$	2,310,365

______________

(1)The effective rate is the yield as of September 30, 2022 and includes the stated interest rate, deferred financing cost amortization and interest associated with variable to fixed interest rate swap agreements.

(2)Pre-payment is generally allowed for each loan upon payment of a customary pre-payment penalty.

(3)Represents a $164 million mortgage loan bearing interest at 4.09% and a $15.5 million loan bearing interest at 6.25%.

(4)Ownership of 383 Main Avenue, Norwalk CT was transferred to the lender during April 2022.

(5)At September 30, 2022, we were in compliance with all debt covenants.

(6)As of August 29, 2022, the benchmark index interest rate was converted from LIBOR to SOFR, plus a benchmark adjustment of 10.0 basis points.

12

---

Principal Payments

    Aggregate required principal payments at September 30, 2022 are as follows (amounts in thousands):

 

Year			Amortization						Maturities						Total
2022			$	2,160					$	—					$	2,160
2023			9,632						—						9,632
2024			9,903						77,675						87,578
2025			7,979						315,000						322,979
2026			8,491						225,000						233,491
Thereafter			35,966						1,606,282						1,642,248
Total			$	74,131					$	2,223,957					$	2,298,088

Deferred Financing Costs

    Deferred financing costs, net, consisted of the following at September 30, 2022 and December 31, 2021 (amounts in thousands):

						September 30, 2022						December 31, 2021
Financing costs						$	44,065					$	44,637
Less: accumulated amortization						(25,875)						(22,525)
Total deferred financing costs, net						$	18,190					$	22,112

    Amortization expense related to deferred financing costs was $1.2 million and $1.1 million for the three months ended September 30, 2022 and 2021, respectively, and $3.8 million and $3.4 million for the nine months ended September 30, 2022 and 2021, respectively.

Unsecured Revolving Credit and Term Loan Facilities

    On August 29, 2022, we entered into a third amendment to our amended and restated credit agreement dated August 29, 2017 with Bank of America, N.A., as administrative agent and the other lenders party thereto, which governs our senior unsecured revolving credit facility and term loan facility (collectively, the “BofA Credit Facility”). The BofA Credit Facility is in the initial maximum principal amount of up to $1.065 billion, which consists of an $850.0 million revolving credit facility that matures on March 31, 2025, and a $215.0 million term loan facility that matures on March 19, 2025. As of September 30, 2022, we had no borrowings under the revolving credit facility and $215.0 million under the term loan facility.

    On August 29, 2022, we entered into a second amendment to our credit agreement dated March 19, 2020 with Wells Fargo Bank, National Association, as administrative agent, and the other lenders party thereto, which governs a senior unsecured term loan facility (the “Wells Term Loan Facility”). The Wells Term Loan Facility is in the original principal amount of $175.0 million and matures on December 31, 2026. We may request the Wells Term Loan Facility be increased through one or more increases or the addition of new pari passu term loan tranches, for a maximum aggregate principal amount not to exceed $225 million. As of September 30, 2022, our borrowings amounted to $175.0 million under the Wells Term Loan Facility.

    The terms of both the BofA Credit Facility and the Wells Term Loan Facility include customary covenants, including limitations on liens, investment, distributions, debt, fundamental changes, and transactions with affiliates and require certain customary financial reports. Both facilities also require compliance with financial ratios including a maximum leverage ratio, a maximum secured leverage ratio, a minimum fixed charge coverage ratio, a minimum unencumbered interest coverage ratio, and a maximum unsecured leverage ratio. The agreements governing both facilities also contain customary events of default (subject in certain cases to specified cure periods), including but not limited to non-payment, breach of covenants, representations or warranties, cross defaults, bankruptcy or other insolvency events, judgments, ERISA events, invalidity of

13

---

loan documents, loss of real estate investment trust qualification, and occurrence of a change of control. As of September 30, 2022, we were in compliance with these covenants.

Senior Unsecured Notes

    The terms of the senior unsecured notes include customary covenants, including limitations on liens, investment, distributions, debt, fundamental changes, and transactions with affiliates and require certain customary financial reports. It also requires compliance with financial ratios including a maximum leverage ratio, a maximum secured leverage ratio, a minimum fixed charge coverage ratio, a minimum unencumbered interest coverage ratio, and a maximum unsecured leverage ratio. The agreements also contain customary events of default (subject in certain cases to specified cure periods), including but not limited to non-payment, breach of covenants, representations or warranties, cross defaults, bankruptcy or other insolvency events, judgments, ERISA events, the occurrence of certain change of control transactions and loss of real estate investment trust qualification. As of September 30, 2022, we were in compliance with these covenants.

6. Accounts Payable and Accrued Expenses

    Accounts payable and accrued expenses consisted of the following as of September 30, 2022 and December 31, 2021 (amounts in thousands):

			September 30, 2022						December 31, 2021
Accrued capital expenditures			$	55,320					$	49,247
Accounts payable and accrued expenses			36,353						41,664
Interest rate swaps liability			—						25,308
Accrued interest payable			3,294						3,460
Due (from) to affiliated companies			(531)						1,131
Total accounts payable and accrued expenses			$	94,436					$	120,810

7. Financial Instruments and Fair Values

Derivative Financial Instruments

    We use derivative financial instruments primarily to manage interest rate risk and such derivatives are not considered speculative. These derivative instruments are typically in the form of interest rate swap and forward agreements, and the primary objective is to minimize interest rate risks associated with investing and financing activities. The counterparties of these arrangements are major financial institutions with which we may also have other financial relationships. We are exposed to credit risk in the event of non-performance by these counterparties; however, we currently do not anticipate that any of the counterparties will fail to meet its obligations.

In May 2022, we entered into forward interest rate swaps with an aggregate notional value of $390.0 million that became effective in August 2022 and fixed the interest rate on 100% of our term loans. This replaced the $265.0 million swap which had fixed the interest rate on a portion of our outstanding term loans balance.

    

    We have agreements with our derivative counterparties that contain a provision where if we either default or are capable of being declared in default on any of our indebtedness, then we could also be declared in default on our derivative obligations. As of September 30, 2022, we did not have any derivatives in a net liability position.

    As of September 30, 2022 and December 31, 2021, we had interest rate swaps and caps with an aggregate notional value of $576.3 million and $451.3 million, respectively. The notional value does not represent exposure to credit, interest rate or market risks. As of September 30, 2022, the fair value of our interest rate swaps amounted to $18.5 million, which is included in prepaid assets and other expenses on the condensed consolidated balance sheet. As of December 31, 2021, the fair value of our interest rate swaps amounted to $(25.3) million, which is included in accounts payable and accrued expenses on the condensed consolidated balance sheet. These interest rate swaps have been designated as cash flow hedges and hedge the variability in future cash flows associated with our existing variable-rate term loan facilities. Interest rate caps not designated as hedges are not speculative and are used to manage our exposure to interest rate movements, but do not meet the strict hedge accounting requirements.

14

---

    As of September 30, 2022 and 2021, our cash flow hedges are deemed highly effective and a net unrealized gain of $21.0 million and $2.8 million for the three months ended September 30, 2022 and 2021, respectively, and a net unrealized gain of $46.8 million and $8.5 million for the nine months ended September 30, 2022 and 2021, respectively, relating to both active and terminated hedges of interest rate risk, are reflected in the condensed consolidated statements of comprehensive income (loss). Amounts reported in accumulated other comprehensive loss related to derivatives will be reclassified to interest expense as interest payments are made on the debt. We estimate that $3.3 million net loss of the current balance held in accumulated other comprehensive income (loss) will be reclassified into interest expense within the next 12 months.

    The table below summarizes the terms of agreements and the fair values of our derivative financial instruments as of September 30, 2022 and December 31, 2021 (amounts in thousands):     

																								September 30, 2022									December 31, 2021
Derivative						Notional Amount			Receive Rate			Pay Rate			Effective Date			Expiration Date						Asset			Liability						Asset			Liability
Interest rate swap						$	265,000		1 Month LIBOR			2.1485%			August 31, 2017			August 24, 2022						$	—		$	—					$	—		$	(3,184)
Interest rate swap						36,820			70% of 1 Month LIBOR			2.5000%			December 1, 2021			November 1, 2030						324			—						—			(4,527)
Interest rate swap						103,790			70% of 1 Month LIBOR			2.5000%			December 1, 2021			November 1, 2033						324			—						—			(15,945)
Interest rate swap						10,710			70% of 1 Month LIBOR			1.7570%			December 1, 2021			November 1, 2033						657									—			(754)
Interest rate swap						19,008			1 Month LIBOR			2.2540%			December 1, 2021			November 1, 2030						1,143			—						—			(898)
Interest rate cap						6,780			70% of 1 Month LIBOR			4.5000%			December 1, 2021			October 1, 2024						16			—						5			—
Interest rate cap						9,188			1 Month LIBOR			5.5000%			December 1, 2021			October 1, 2024						43			—						8			—
Interest rate swap						175,000			SOFR Compound			2.5620%			August 31, 2022			December 31, 2026						8,713			—						—			—
Interest rate swap						107,500			SOFR Compound			2.6260%			August 19, 2022			March 19, 2025						3,649			—						—			—
Interest rate swap						107,500			SOFR OIS Compound			2.6280%			August 19, 2022			March 19, 2025						3,646			—						—			—
																								$	18,515		$	—					$	13		$	(25,308)

    The table below shows the effect of our derivative financial instruments designated as cash flow hedges on accumulated other comprehensive income (loss) for the three and nine months ended September 30, 2022 and 2021 (amounts in thousands):    

						Three Months Ended												Nine Months Ended
Effects of Cash Flow Hedges						September 30, 2022						September 30, 2021						September 30, 2022						September 30, 2021
Amount of gain (loss) recognized in other comprehensive income (loss)						$	19,588					$	(103)					$	39,407					$	(139)
Amount of loss reclassified from accumulated other comprehensive income ( loss) into interest expense						(1,392)						(2,920)						(7,428)						(8,687)

    The table below shows the effect of our derivative financial instruments designated as cash flow hedges on the condensed consolidated statements of operations for the three and nine months ended September 30, 2022 and 2021 (amounts in thousands):

						Three Months Ended												Nine Months Ended
Effects of Cash Flow Hedges						September 30, 2022						September 30, 2021						September 30, 2022						September 30, 2021
Total interest expense presented in the condensed consolidated statements of operations in which the effects of cash flow hedges are recorded						$	(25,516)					$	(23,577)					$	(75,572)					$	(70,553)
Amount of loss reclassified from accumulated other comprehensive income (loss) into interest expense						(1,392)						(2,920)						(7,428)						(8,687)

15

---

Fair Valuation

    The estimated fair values at September 30, 2022 and December 31, 2021 were determined by management, using available market information and appropriate valuation methodologies. Considerable judgment is necessary to interpret market data and develop estimated fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts we could realize on disposition of the financial instruments. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts.

    The fair value of derivative instruments is determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. Although the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by ourselves and our counterparties. The impact of such credit valuation adjustments, determined based on the fair value of each individual contract, was not significant to the overall valuation. As a result, all our derivatives were classified as Level 2 of the fair value hierarchy.

    The fair values of our mortgage notes payable, senior unsecured notes - Series A, B, C, D, E, F, G and H - unsecured term loan facilities and unsecured revolving credit facility which are determined using Level 3 inputs are estimated by discounting the future cash flows using current interest rates at which similar borrowings could be made by us.

    The following tables summarize the carrying and estimated fair values of our financial instruments as of September 30, 2022 and December 31, 2021 (amounts in thousands):

			September 30, 2022
									Estimated Fair Value
			Carrying Value						Total						Level 1						Level 2						Level 3
Interest rate swaps included in prepaid expenses and other assets			$	18,457					$	18,457					$	—					$	18,457					$	—
Mortgage notes payable			915,202						809,720						—						—						809,720
Senior unsecured notes - Series A, B, C, D, E, F, G and H			973,607						862,768						—						—						862,768
Unsecured term loan facilities			388,645						390,000						—						—						390,000

			December 31, 2021
									Estimated Fair Value
			Carrying Value						Total						Level 1						Level 2						Level 3
Interest rate swap included in accounts payable and accrued expenses			$	25,308					$	25,308					$	—					$	25,308					$	—
Mortgage notes payable			948,769						960,933						—						—						960,933
Senior unsecured notes - Series A, B, C, D, E, F, G and H			973,373						994,389						—						—						994,389
Unsecured term loan facilities			388,223						390,000						—						—						390,000

    Disclosure about the fair value of financial instruments is based on pertinent information available to us as of September 30, 2022 and December 31, 2021. Although we are not aware of any factors that would significantly affect the reasonable fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since that date and current estimates of fair value may differ significantly from the amounts presented herein.

8. Leases

Lessor

    We lease various spaces to tenants over terms ranging from one to 21 years. Certain leases have renewal options for additional terms. The leases provide for base monthly rentals and reimbursements for real estate taxes, escalations linked to the consumer price index or common area maintenance known as operating expense escalation. Operating expense reimbursements are reflected in our September 30, 2022 and 2021 condensed consolidated statements of operations as rental revenue.

16

---

Rental revenue includes fixed and variable payments. Fixed payments primarily relate to base rent and variable payments primarily relate to tenant expense reimbursements for certain property operating costs. The components of rental revenue for the three and nine months ended September 30, 2022 and 2021 are as follows (amounts in thousands):

						Three Months Ended												Nine Months Ended
Rental revenue						September 30, 2022						September 30, 2021						September 30, 2022						September 30, 2021
Fixed payments						$	131,800					$	124,764					$	399,995					$	374,968
Variable payments						16,490						14,794						45,148						45,618
Total rental revenue						$	148,290					$	139,558					$	445,143					$	420,586

As of September 30, 2022, we were entitled to the following future contractual minimum lease payments (excluding operating expense reimbursements) on non-cancellable operating leases to be received which expire on various dates through 2039 (amounts in thousands):

Remainder of 2022			$	120,126
2023			487,764
2024			480,189
2025			448,981
2026			407,826
Thereafter			1,934,341
			$	3,879,227

The above future minimum lease payments exclude tenant recoveries and the net accretion of above and below-market lease intangibles. Some leases are subject to termination options generally upon payment of a termination fee. The preceding table is prepared assuming such options are not exercised.

Lessee

    We determine if an arrangement is a lease at inception. Our operating lease agreements relate to three ground lease assets and are reflected in right-of-use assets of $28.7 million and lease liabilities of $28.7 million in our consolidated balance sheets as of September 30, 2022. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Right-of-use assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. Variable lease payments are excluded from the right-of-use assets and lease liabilities and are recognized in the period in which the obligation for those payments is incurred.

    The ground leases are due to expire between the years 2050 and 2077, inclusive of extension options, and have no variable payments or residual value guarantees. As our leases do not provide an implicit rate, we determined our incremental borrowing rate based on information available at the date of adoption of Accounting Standards Update No. 2016-02, Leases (Topic 842), in determining the present value of lease payments. The weighted average incremental borrowing rate used to calculate the right-of-use assets and lease liabilities as of September 30, 2022 was 4.5%. Rent expense for lease payments related to our operating leases is recognized on a straight-line basis over the non-cancellable term of the leases. The weighted average remaining lease term as of September 30, 2022 was 47.7 years.

    As of September 30, 2022, the following table summarizes our future minimum lease payments discounted by our incremental borrowing rates to calculate the lease liabilities of our leases (amounts in thousands):

17

---

Remainder of 2022			$	380
2023			1,518
2024			1,518
2025			1,518
2026			1,518
Thereafter			63,744
Total undiscounted cash flows			70,196
Present value discount			(41,471)
Ground lease liabilities			$	28,725

9. Commitments and Contingencies

Legal Proceedings

    Except as described below, as of September 30, 2022, we were not involved in any material litigation, nor, to our knowledge, was any material litigation threatened against us or our properties, other than routine litigation arising in the ordinary course of business such as disputes with tenants. We believe that the costs and related liabilities, if any, which may result from such actions will not materially affect our condensed consolidated financial position, operating results or liquidity.    

    As previously disclosed, in October 2014, 12 former investors (the "Claimants") in Empire State Building Associates L.L.C. (“ESBA”), which prior to the initial public offering of our company (the "Offering") owned the fee title to the Empire State Building, filed an arbitration with the American Arbitration Association against Peter L. Malkin, Anthony E. Malkin, Thomas N. Keltner, Jr., and our subsidiary ESRT MH Holdings LLC, the former supervisor of ESBA (the "Respondents"). The statement of claim (also filed later in federal court in New York for the expressed purpose of tolling the statute of limitations) alleges breach of fiduciary duty and related claims in connection with the Offering and formation transactions and seeks monetary damages and declaratory relief. Claimants had opted out of a prior class action bringing similar claims that was settled with court approval. Respondents filed an answer and counterclaims. In March 2015, the federal court action was stayed on consent of all parties pending the arbitration. Arbitration hearings started in May 2016 and concluded in August 2018. On August 26, 2020, the arbitration panel issued an award that denied all Claimants’ claims with one exception, on which it awarded Claimants approximately $1.2 million, inclusive of seven years of interest through October 2, 2020. This amount was recorded as an IPO litigation expense in the consolidated statement of operations for the year ended December 31, 2020.

Respondents believe that such award in favor of the Claimants is entirely without merit and sought to vacate that portion of the award. On September 27, 2021, the court denied Respondents' motion to vacate and entered judgement in the aforementioned amount, inclusive of accumulated interest. Respondents have appealed that ruling. On May 10, 2022, Respondents moved to dismiss the appeal and judgment on the grounds that a recent decision of the United States Supreme Court held that the federal courts have no subject matter jurisdiction over the case. Claimants opposed the motion, which is pending. In addition, certain of the Claimants in the federal court action sought to pursue claims in that case against Respondents. Respondents believe that any such claims are meritless. The magistrate judge assigned to the action has issued a Report and Recommendation rejecting Claimants’ claims; the district judge will decide whether to adopt the Report and Recommendation.

Pursuant to indemnification agreements which were made with our directors, executive officers and chairman emeritus as part of our formation transactions, Anthony E. Malkin, Peter L. Malkin and Thomas N. Keltner, Jr. have defense and indemnity rights from us with respect to this arbitration.

Unfunded Capital Expenditures

    At September 30, 2022, we estimate that we will incur approximately $117.9 million of capital expenditures (including tenant improvements and leasing commissions) on our properties pursuant to existing lease agreements. We expect to fund these capital expenditures with operating cash flow, additional property level mortgage financings, our unsecured credit facility, cash on hand and other borrowings. Future property acquisitions may require substantial capital investments for refurbishment and leasing costs. We expect that these financing requirements will be met in a similar fashion.

Concentration of Credit Risk

18

---

    Financial instruments that subject us to credit risk consist primarily of cash and cash equivalents, restricted cash, short-term investments, tenant and other receivables and deferred rent receivables. At September 30, 2022, we held on deposit at various major financial institutions cash and cash equivalents and restricted cash balances in excess of amounts insured by the Federal Deposit Insurance Corporation.

Asset Retirement Obligations

    We are required to accrue costs that we are legally obligated to incur on retirement of our properties which result from acquisition, construction, development and/or normal operation of such properties. Retirement includes sale, abandonment or disposal of a property. Under that standard, a conditional asset retirement obligation represents a legal obligation to perform an asset retirement activity in which the timing and/or method of settlement is conditional on a future event that may or may not be within a company’s control and a liability for a conditional asset retirement obligation must be recorded if the fair value of the obligation can be reasonably estimated. Environmental site assessments and investigations have identified asbestos or asbestos-containing building materials in certain of our properties. As of September 30, 2022, management has no plans to remove or alter these properties in a manner that would trigger federal and other applicable regulations for asbestos removal, and accordingly, the obligations to remove the asbestos or asbestos-containing building materials from these properties have indeterminable settlement dates. As such, we are unable to reasonably estimate the fair value of the associated conditional asset retirement obligation. However, ongoing asbestos abatement, maintenance programs and other required documentation are carried out as required and related costs are expensed as incurred.

Other Environmental Matters

    Certain of our properties have been inspected for soil contamination due to pollutants, which may have occurred prior to our ownership of these properties or subsequently in connection with its development and/or its use. Required remediation to such properties has been completed, and as of September 30, 2022, management believes that there are no obligations related to environmental remediation other than maintaining the affected sites in conformity with the relevant authority’s mandates and filing the required documents. All such maintenance costs are expensed as incurred. We expect that resolution of the environmental matters relating to the above will not have a material impact on our business, assets, consolidated financial condition, results of operations or liquidity. However, we cannot be certain that we have identified all environmental liabilities at our properties, that all necessary remediation actions have been or will be undertaken at our properties or that we will be indemnified, in full or at all, in the event that such environmental liabilities arise.

Insurance Coverage

    We carry insurance coverage on our properties of types and in amounts with deductibles that we believe are in line with coverage customarily obtained by owners of similar properties.

10. Capital

    As of September 30, 2022, there were 160,576,042 shares of Class A common stock 993,332 shares of Class B common stock and 110,959,627 operating partnership units outstanding, of which 161,569,374, or 59.3%, were owned by ESRT and 110,959,627, or 40.7%, were owned by other partners, including ESRT directors, members of senior management and other employees.

    On May 16, 2019, the Empire State Realty Trust, Inc. Empire State Realty OP, L.P. 2019 Equity Incentive Plan (“2019 Plan”) was approved by our shareholders.  The 2019 Plan provides for grants to directors, employees and consultants of ESRT and the Operating Partnership, including options, restricted stock, restricted stock units, stock appreciation rights, performance awards, dividend equivalents and other equity-based awards.  An aggregate of approximately 11.0 million shares of ESRT common stock is authorized for issuance under awards granted pursuant to the 2019 Plan. We will not issue any new equity awards under the First Amended and Restated Empire State Realty Trust, Inc. and Empire State Realty OP, L.P. 2013 Equity Incentive Plan ("2013 Plan", and collectively with the 2019 Plan, "the Plans"). The shares of ESRT Class A common stock underlying any awards under the 2019 Plan and the 2013 Plan that are forfeited, canceled or otherwise terminated, other than by exercise, will be added back to the shares of ESRT Class A common stock available for issuance under the 2019 Plan. Shares tendered or held back upon exercise of a stock option or settlement of an award under the 2019 Plan or the 2013 Plan to cover the exercise price or tax withholding and shares subject to a stock appreciation right that are not issued in connection with the stock settlement of the stock appreciation right upon exercise thereof, will not be added back to the shares of ESRT Class A common stock available for issuance under the 2019 Plan. In addition, shares of ESRT Class A common stock repurchased on the open market will not be added back to the shares of ESRT Class A common stock available for issuance under the 2019 Plan.

19

---

    Long-term incentive plan ("LTIP") units are a special class of partnership interests. Each LTIP unit awarded will be deemed equivalent to an award of one share of ESRT stock under the Plans, reducing the availability for other equity awards on a one-for-one basis.

    The vesting period for LTIP units, if any, will be determined at the time of issuance. Under the terms of the LTIP units, we will revalue for tax purposes its assets upon the occurrence of certain specified capital events, and any increase in valuation from the time of one such event to the next such event will be allocated first to the holders of LTIP units to equalize the capital accounts of such holders with the capital accounts of unitholders. Subject to any agreed upon exceptions, once vested and having achieved parity with unitholders, LTIP units are convertible into Series PR operating partnership units on a one-for-one basis.     

     LTIP units subject to time-based vesting, whether vested or not, receive per unit distributions as operating partnership units, which equal per share dividends (both regular and special) on our common stock. Market and performance-based LTIPs receive 10% of such distributions currently, unless and until such LTIP units are earned based on performance, at which time they will receive the accrued and unpaid 90% and will commence receiving 100% of such distributions thereafter.

Stock and Publicly Traded Operating Partnership Unit Repurchase Program

    ESRT's Board of Directors authorized the repurchase of up to $500 million of ESRT Class A common stock and the Operating Partnership’s Series ES, Series 250 and Series 60 operating partnership units from January 1, 2022 through December 31, 2023. Under the program, ESRT may purchase ESRT Class A common stock and we may purchase our Series ES, Series 250 and Series 60 operating partnership units in accordance with applicable securities laws from time to time in the open market or in privately negotiated transactions. The timing, manner, price and amount of any repurchases will be determined by ESRT and us and will be subject to stock price, availability, trading volume, general market conditions, and applicable securities laws. The authorization does not obligate ESRT or us to acquire any particular amount of securities, and the program may be suspended or discontinued at ESRT and our discretion without prior notice.

    The following table summarizes ESRT's purchases of equity securities in each of the three months ended September 30, 2022:

Period			Total Number of Shares Purchased						Weighted Average Price Paid per Share						Maximum Approximate Dollar Value Available for Future Purchase (in thousands)
July 2022			184,045						$	6.92					$	434,286
August 2022			621,314						$	7.32					$	429,736
September 2022			1,761,561						$	6.97					$	417,455

Private Perpetual Preferred Units

    As of September 30, 2022, there were 4,664,038 Series 2019 Preferred Units ("Series 2019 Preferred Units") and 1,560,360 Series 2014 Private Perpetual Preferred Units ("Series 2014 Preferred Units") outstanding. The Series 2019 Preferred Units have a liquidation preference of $13.52 per unit and are entitled to receive cumulative preferential annual cash distributions of $0.70 per unit payable in arrears on a quarterly basis. The Series 2014 Preferred Units which have a liquidation preference of $16.62 per unit and are entitled to receive cumulative preferential annual cash distributions of $0.60 per unit payable in arrears on a quarterly basis. Both series are not redeemable at the option of the holders and are redeemable at our option only in the case of specific defined events.

Distributions

    Total distributions paid to OP unitholders were $9.6 million and $29.1 million for the three and nine months ended September 30, 2022, respectively, and $10.0 million and $19.4 million for the three and nine months ended September 30, 2021, respectively. Total distributions paid to preferred unitholders were $1.1 million and $3.2 million for the three and nine months ended September 30, 2022, respectively, and $1.1 million and $3.2 million for the three and nine months ended September 30, 2021, respectively.

Incentive and Share-Based Compensation

20

---

    The Plans provide for grants to directors, employees and consultants consisting of stock options, restricted stock, dividend equivalents, stock payments, performance shares, LTIP units, stock appreciation rights and other incentive awards. An aggregate of 11.0 million shares of ESRT common stock is authorized for issuance under awards granted pursuant to the 2019 Plan, and as of September 30, 2022, 5.9 million shares of ESRT common stock remain available for future issuance.

Share-based compensation for time-based equity awards is measured at the fair value of the award on the date of grant and recognized as an expense on a straight-line basis over the shorter of (i) the stated vesting period, which is generally three, four or five years, or (ii) the period from the date of grant to the date the employee becomes retirement eligible, which may occur upon grant. An employee is retirement eligible when the employee attains the (i) age of 65 for awards granted in 2020 and after and age of 60 for awards granted before 2020 and (ii) the date on which the employee has first completed ten years of continuous service with us or our affiliates. Share-based compensation for market-based equity awards and performance-based equity awards is measured at the fair value of the award on the date of grant and recognized as an expense on a straight-line basis over three or four years. Additionally, for the performance-based equity awards, we assess, at each reporting period, whether it is probable that the performance conditions will be satisfied. We recognize expense respective to the number of awards we expect to vest at the conclusion of the measurement period. Changes in estimate are accounted for in the period of change through a cumulative catch-up adjustment.

    For the market-based LTIP units, the fair value of the awards was estimated using a Monte Carlo Simulation model and discounted for the restriction period during which the LTIP units cannot be redeemed or transferred and the uncertainty regarding if, and when, the book capital account of the LTIP units will equal that of the common units.  Our stock price, along with the prices of the comparative indexes, is assumed to follow the Geometric Brownian Motion Process.  Geometric Brownian Motion is a common assumption when modeling in financial markets, as it allows the modeled quantity (in this case the stock price) to vary randomly from its current value and take any value greater than zero.  The volatilities of the returns on our stock price and the comparative indexes were estimated based on implied volatilities and historical volatilities using an appropriate look-back period.  The expected growth rate of the stock prices over the performance period is determined with consideration of the risk-free rate as of the grant date.  For LTIP unit awards that are time or performance based, the fair value of the awards was estimated based on the fair value of our stock at the grant date discounted for the restriction period during which the LTIP units cannot be redeemed or transferred and the uncertainty regarding if, and when, the book capital account of the LTIP units will equal that of the common units.  For restricted stock awards, the fair value of the awards are based on the market price of ESRT stock at the grant date.

    LTIP units and ESRT restricted stock issued during the nine months ended September 30, 2022 were valued at $22.4 million. The weighted average per unit or share fair value was $7.21 for grants issued in 2022. The fair value per unit or share granted in 2022 was estimated on the respective dates of grant using the following assumptions: an expected life from 2.0 to 5.3 years, a dividend rate of 2.0%, a risk-free interest rate from 1.4% to 2.0%, and an expected price volatility from 37.0% to 53.0%.     No other stock options, dividend equivalents, or stock appreciation rights were issued or outstanding in 2022.

    The following is a summary of ESRT restricted stock and LTIP unit activity for the nine months ended September 30, 2022:

			Restricted Stock						Time-based LTIPs						Market-based LTIPs						Performance-based LTIPs						Weighted Average Grant Fair Value
Unvested balance at December 31, 2021			214,408						2,499,592						5,039,134						—						$	7.02
Vested			(68,867)						(1,052,119)						—						—						9.95
Granted			232,448						1,514,434						780,155						578,943						7.21
Forfeited or unearned			(17,830)						—						(1,311,839)						—						7.21
Unvested balance at September 30, 2022			360,159						2,961,907						4,507,450						578,943						$	6.67

    The time-based LTIPs and ESRT restricted stock awards are treated for accounting purposes as immediately vested upon the later of (i) the date the grantee attains the age of 60 or 65, as applicable, and (ii) the date on which grantee has first completed ten years of continuous service with our company or its affiliates. For award agreements that qualify, we recognize noncash compensation expense on the grant date for the time-based awards and ratably over the vesting period for the market-based and performance-based awards, and accordingly, we recognized $0.4 million and $2.0 million for the three and nine months ended September 30, 2022, respectively, and $0.7 million and $2.1 million for the three and nine months ended September 30, 2021, respectively. Unrecognized compensation expense was $1.2 million at September 30, 2022, which will be recognized over a weighted average period of 3.3 years.

    For the remainder of the LTIP unit and ESRT restricted stock awards, we recognize noncash compensation expense ratably over the vesting period, and accordingly, we recognized noncash compensation expense of $4.8 million and $13.7

21

---

million for the three and nine months ended September 30, 2022, respectively, and $4.7 million and $13.3 million for the three and nine months ended September 30, 2021, respectively. Unrecognized compensation expense was $30.7 million at September 30, 2022, which will be recognized over a weighted average period of 2.6 years.

Earnings Per Unit

    Earnings per unit for the three and nine months ended September 30, 2022 and 2021 is computed as follows (amounts in thousands, except per share amounts):

			Three Months Ended												Nine Months Ended
			September 30, 2022						September 30, 2021						September 30, 2022						September 30, 2021
Numerator:
Net income (loss)			$	10,118					$	(10,183)					$	41,592					$	(8,963)
Private perpetual preferred unit distributions			(1,050)						(1,050)						(3,151)						(3,151)
Net loss attributable to non-controlling interests in other partnerships			49						—						271						—
Earnings allocated to unvested units			—						(114)						—						(227)
Net income (loss) attributable to common unitholders – basic and diluted			$	9,117					$	(11,347)					$	38,712					$	(12,341)
Denominator:
Weighted average units outstanding – basic			266,035						277,716						269,880						277,829
Effect of dilutive securities:
Stock-based compensation plans			1,086						—						1,086						—
Weighted average units outstanding –- diluted			267,121						277,716						270,966						277,829
Earnings per share:
Basic			$	0.03					$	(0.04)					$	0.14					$	(0.04)
Diluted			$	0.03					$	(0.04)					$	0.14					$	(0.04)

    There were zero and zero antidilutive shares and LTIP units for the three and nine months ended September 30, 2022, respectively, and 1,084 and 998 antidilutive shares and LTIP units for the three and nine months ended September 30, 2021, respectively.

11. Related Party Transactions

Supervisory Fee Revenue

    We earned supervisory fees from entities affiliated with Anthony E. Malkin, our Chairman, President and Chief Executive Officer, of $0.2 million and $0.3 million for the three months ended September 30, 2022 and 2021, respectively, and $0.8 million and $0.8 million for the nine months ended September 30, 2022 and 2021, respectively. These fees are included within third-party management and other fees.

Property Management Fee Revenue

    We earned property management fees from entities affiliated with Anthony E. Malkin of $0.1 million and $0.1 million for the three months ended September 30, 2022 and 2021, respectively, and $0.2 million and $0.2 million for the nine months ended September 30, 2022 and 2021, respectively. These fees are included within third-party management and other fees.

Other

22

---

     We receive rent generally at the market rental rate for 5,447 square feet of leased space from entities affiliated with Anthony E. Malkin at one of our properties. Under the lease, the tenant has the right to cancel such lease without special payment on 90 days’ notice. We also have a shared use agreement with such tenant, to occupy a portion of the leased premises as the office location for Peter L. Malkin, our chairman emeritus and employee, utilizing approximately 15% of the space, for which we pay to such tenant an allocable pro rata share of the cost. We also have agreements with these entities and excluded properties and businesses to provide them with general computer-related support services. Total revenue aggregated $0.1 million and $0.1 million for the three months ended September 30, 2022 and 2021, respectively, and $0.2 million and $0.2 million for the nine months ended September 30, 2022 and 2021, respectively.

12. Segment Reporting

    We have identified two reportable segments: (1) real estate and (2) observatory. Our real estate segment includes all activities related to the ownership, management, operation, acquisition, redevelopment, repositioning and disposition of our traditional real estate assets. Our observatory segment includes the operation of the 86th and 102nd floor observatories at the Empire State Building. These two lines of businesses are managed separately because each business requires different support infrastructures, provides different services and has dissimilar economic characteristics such as investments needed, stream of revenues and marketing strategies. We account for intersegment sales and rents as if the sales or rents were to third parties, that is, at current market prices.

23

---

    The following tables provide components of segment net income (loss) for each segment for the three and nine months ended September 30, 2022 and 2021 (amounts in thousands):

						Three Months Ended September 30, 2022
						Real Estate						Observatory						Intersegment Elimination						Total
Revenues:
Rental revenue						$	148,290					$	—					$	—					$	148,290
Intercompany rental revenue						19,072						—						(19,072)						—
Observatory revenue						—						33,051						—						33,051
Lease termination fees						—						—						—						—
Third-party management and other fees						389						—						—						389
Other revenue and fees						1,982						—						—						1,982
Total revenues						169,733						33,051						(19,072)						183,712
Operating expenses:
Property operating expenses						42,798						—						—						42,798
Intercompany rent expense						—						19,072						(19,072)						—
Ground rent expense						2,331						—						—						2,331
General and administrative expenses						15,725						—						—						15,725
Observatory expenses						—						8,516						—						8,516
Real estate taxes						31,831						—						—						31,831
Depreciation and amortization						46,933						51						—						46,984
Total operating expenses						139,618						27,639						(19,072)						148,185
Total operating income						30,115						5,412						—						35,527
Other income (expense):
Interest income						1,530						34						—						1,564
Interest expense						(25,516)						—						—						(25,516)
Gain on disposition of property						—						—						—						—
Income before income taxes						6,129						5,446						—						11,575
Income tax expense						(359)						(1,098)						—						(1,457)
Net income						$	5,770					$	4,348					$	—					$	10,118
Segment assets						$	3,950,883					$	250,257					$	—					$	4,201,140
Expenditures for segment assets						$	18,686					$	24					$	—					$	18,710

24

---

						Three Months Ended September 30, 2021
						Real Estate						Observatory						Intersegment Elimination						Total
Revenues:
Rental revenue						$	139,558					$	—					$	—					$	139,558
Intercompany rental revenue						5,310						—						(5,310)						—
Observatory revenue						—						12,796						—						12,796
Lease termination fees						11,321						—						—						11,321
Third-party management and other fees						314						—						—						314
Other revenue and fees						921						138						—						1,059
Total revenues						157,424						12,934						(5,310)						165,048
Operating expenses:
Property operating expenses						33,357						—						—						33,357
Intercompany rent expense						—						5,310						(5,310)						—
Ground rent expense						2,331						—						—						2,331
General and administrative expenses						14,427						—						—						14,427
Observatory expenses						—						6,370						—						6,370
Real estate taxes						29,566						—						—						29,566
Depreciation and amortization						65,759						35						—						65,794
Total operating expenses						145,440						11,715						(5,310)						151,845
Total operating income (loss)						11,984						1,219						—						13,203
Other income (expense):
Interest income						211						—						—						211
Interest expense						(23,577)						—						—						(23,577)
Income (loss) before income taxes						(11,382)						1,219						—						(10,163)
Income tax (expense) benefit						53						(73)						—						(20)
Net income (loss)						$	(11,329)					$	1,146					$	—					$	(10,183)
Segment assets						$	3,870,142					$	242,021					$	—					$	4,112,163
Expenditures for segment assets						$	21,349					$	—					$	—					$	21,349

25

---

						Nine Months Ended September 30, 2022
						Real Estate						Observatory						Intersegment Elimination						Total
Revenues:
Rental revenue						$	445,143					$	—					$	—					$	445,143
Intercompany rental revenue						46,801						—						(46,801)						—
Observatory revenue						—						73,660						—						73,660
Lease termination fees						20,032						—						—						20,032
Third-party management and other fees						1,025						—						—						1,025
Other revenue and fees						5,908						—						—						5,908
Total revenues						518,909						73,660						(46,801)						545,768
Operating expenses:
Property operating expenses						118,875						—						—						118,875
Intercompany rent expense						—						46,801						(46,801)						—
Ground rent expense						6,994						—						—						6,994
General and administrative expenses						45,287						—						—						45,287
Observatory expenses						—						22,507						—						22,507
Real estate taxes						91,637						—						—						91,637
Depreciation and amortization						172,258						136						—						172,394
Total operating expenses						435,051						69,444						(46,801)						457,694
Total operating income (loss)						83,858						4,216						—						88,074
Other income (expense):
Interest income						2,105						39						—						2,144
Interest expense						(75,572)						—						—						(75,572)
Gain on disposition of property						27,170						—						—						27,170
Income (loss) before income taxes						37,561						4,255						—						41,816
Income tax (expense) benefit						(541)						317						—						(224)
Net income						$	37,020					$	4,572					$	—					$	41,592
Expenditures for segment assets						$	70,795					$	315					$	—					$	71,110

26

---

						Nine Months Ended September 30, 2021
						Real Estate						Observatory												Intersegment Elimination						Total
Revenues:
Rental revenue						$	420,586					$	—											$	—					$	420,586
Intercompany rental revenue						16,271						—												(16,271)						—
Observatory revenue						—						23,758												—						23,758
Lease termination fees						15,949						—												—						15,949
Third-party management and other fees						917						—												—						917
Other revenue and fees						2,412						138												—						2,550
Total revenues						456,135						23,896												(16,271)						463,760
Operating expenses:
Property operating expenses						92,429						—												—						92,429
Intercompany rent expense						—						16,271												(16,271)						—
Ground rent expense						6,994						—												—						6,994
General and administrative expenses						42,369						—												—						42,369
Observatory expenses						—						16,226												—						16,226
Real estate taxes						92,367						—												—						92,367
Depreciation and amortization						155,244						95												—						155,339
Total operating expenses						389,403						32,592												(16,271)						405,724
Total operating income (loss)						66,732						(8,696)												—						58,036
Other income (expense):
Interest income						494						3												—						497
Interest expense						(70,553)						—												—						(70,553)
Loss on early extinguishment of debt						(214)						—												—						(214)
Income (loss) before income taxes						(3,541)						(8,693)												—						(12,234)
Income tax (expense) benefit						(365)						3,636												—						3,271
Net loss						$	(3,906)					$	(5,057)											$	—					$	(8,963)
Expenditures for segment assets						$	64,655					$	4											$	—					$	64,659

13. Subsequent Events

    None.

27

---

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Unless the context otherwise requires or indicates, references in this section to “we,” “our,” and “us” refer to our company and its consolidated subsidiaries. The following discussion related to our consolidated financial statements should be read in conjunction with the financial statements and the notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2021.

FORWARD-LOOKING STATEMENTS

     This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and are including this statement for purposes of complying with those safe harbor provisions. You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “estimates,” “contemplates,” “aims,” “continues,” “would” or “anticipates” or the negative of these words and phrases or similar words or phrases. In particular, statements pertaining to our capital resources, portfolio performance, dividend policy and results of operations contain forward-looking statements. Likewise, all of our statements regarding anticipated growth in our portfolio from operations, acquisitions and anticipated market conditions, demographics and results of operations are forward-looking statements.

Forward-looking statements are subject to substantial risks and uncertainties, many of which are difficult to predict and are generally beyond our control, and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods which may be incorrect or imprecise, and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all).

The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: (i) economic, market, political and social impact of, and uncertainty relating to, the COVID-19 pandemic; (ii) a failure of conditions or performance regarding any event or transaction described herein, (iii) resolution of legal proceedings involving the Company; (iv) reduced demand for office, multifamily or retail space, including as a result of the COVID-19 pandemic; (v) changes in our business strategy; (vi) changes in technology and market competition that affect utilization of our office, retail, Observatory, broadcast or other facilities; (vii) changes in domestic or international tourism, including due to health crises such as the COVID-19 pandemic, geopolitical events, including global hostilities, currency exchange rates, and/or competition from recently opened observatories in New York City, any or all of which may cause a decline in Observatory visitors; (viii) defaults on, early terminations of, or non-renewal of, leases by tenants; (ix) increases in the Company’s borrowing costs as a result of changes in interest rates and other factors, including the current phasing out of LIBOR; (x) declining real estate valuations and impairment charges; (xi) termination of our ground leases; (xii) changes in our ability to pay down, refinance, restructure or extend our indebtedness as it becomes due and potential limitations on our ability to borrow additional funds in compliance with drawdown conditions and financial covenants; (xiii) decreased rental rates or increased vacancy rates; (xiv) our failure to execute any newly planned capital project successfully or on the anticipated timeline or budget; (xv) difficulties in identifying and completing acquisitions; (xvi) risks related to any development project (including our Metro Tower potential development site); (xvii) impact of changes in governmental regulations, tax laws and rates and similar matters; (xviii) our failure to qualify as a REIT; (xix) environmental uncertainties and risks related to climate change, adverse weather conditions, rising sea levels and natural disasters; (xx) incurrence of taxable capital gain on disposition of an asset due to failure of use or compliance with a 1031 exchange program; and (xxi) accuracy of our methodologies and estimates regarding ESG metrics and goals, tenant willingness and ability to collaborate in reporting ESG metrics and meeting ESG goals, and impact of governmental regulation on our ESG efforts. For a further discussion of these and other factors that could impact the Company's future results, see the section entitled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, and other risks described in documents subsequently filed by the Company from time to time with the Securities and Exchange Commission.

While forward-looking statements reflect the Company's good faith beliefs, they are not guarantees of future performance. The Company disclaims any obligation to update or revise publicly any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events, or other changes after the date of this Quarterly

Report on Form 10-Q, except as required by applicable law. Prospective investors should not place undue reliance on any forward-looking statements, which are based only on information currently available to the Company.

28

---

Overview

Empire State Realty OP, L.P. is the entity through which ESRT, a self-administered and self-managed REIT, conducts all of its business and owns (either directly or through subsidiaries) substantially all of its assets. We own and manage office, retail and multifamily assets in Manhattan and the greater New York metropolitan area. As the owner of the Empire State Building, the World’s Most Famous Building, ESRT also owns and operates its iconic, newly reimagined Observatory Experience.     

Highlights for the three months ended September 30, 2022

•Incurred net income attributable to common unitholders of $9.1 million and achieved Core Funds From Operations attributable to common unitholders ("Core FFO") of $56.5 million.

•Total commercial portfolio 88.5% leased, New York City office portfolio 89.4% leased.

•Signed a total of 335,382 rentable square feet of new, renewal, and expansion leases.

•Empire State Building Observatory generated $24.5 million of net operating income for the third quarter 2022.

•ESRT repurchased $20.1 million of its common stock in the third quarter of 2022 and through October 24, 2022.

Results of Operations

Overview

    The discussion below relates to our financial condition and results of operations for the three months ended September 30, 2022 and 2021, respectively.

Three Months Ended September 30, 2022 Compared to the Three Months Ended September 30, 2021

The following table summarizes our historical results of operations for the three months ended September 30, 2022 and 2021 (amounts in thousands):

29

---

			Three Months Ended September 30,
			2022						2021						Change						%
Revenues:
Rental revenue			$	148,290					$	139,558					$	8,732					6.3		%
Observatory revenue			33,051						12,796						20,255						158.3		%
Lease termination fees			—						11,321						(11,321)						(100.0)		%
Third-party management and other fees			389						314						75						23.9		%
Other revenues and fees			1,982						1,059						923						87.2		%
Total revenues			183,712						165,048						18,664						11.3		%
Operating expenses:
Property operating expenses			42,798						33,357						(9,441)						(28.3)		%
Ground rent expenses			2,331						2,331						—						—		%
General and administrative expenses			15,725						14,427						(1,298)						(9.0)		%
Observatory expenses			8,516						6,370						(2,146)						(33.7)		%
Real estate taxes			31,831						29,566						(2,265)						(7.7)		%
Depreciation and amortization			46,984						65,794						18,810						28.6		%
Total operating expenses			148,185						151,845						3,660						2.4		%
Operating income			35,527						13,203						22,324						169.1		%
Other income (expense):
Interest income			1,564						211						1,353						641.2		%
Interest expense			(25,516)						(23,577)						(1,939)						(8.2)		%
Income (loss) before income taxes			11,575						(10,163)						21,738						213.9		%
Income tax (expense) benefit			(1,457)						(20)						(1,437)						(7,185.0)		%
Net income (loss)			10,118						(10,183)						20,301						199.4		%
Private perpetual preferred unit distributions			(1,050)						(1,050)						—						—		%
Net loss attributable to non-controlling interests in other partnerships			49						—						49						100.0		%
Net income (loss) attributable to common unitholders			$	9,117					$	(11,233)					$	20,350					181.2		%

Rental Revenue

    The increase in rental revenue reflects the inclusion of revenue from our multifamily properties which were acquired on December 22, 2021.

 Observatory Revenue

Observatory revenues were higher driven by increased visitation.

Other Revenues and Fees

The increase in other revenues and fees was due to higher food and beverage sales, parking income and bad debt recovery income.

Property Operating Expenses

The increase in property operating expenses reflects higher payroll, utilities, cleaning and other operating expenses, and the inclusion of operating expenses from our recently acquired multifamily properties.

General and Administrative Expenses

The increase in general and administrative expenses reflects higher equity compensation and payroll costs, information technology costs and professional fees.

30

---

Observatory Expenses

The increase in observatory expenses was driven by increased operating hours, which increased variable costs such as labor, union, security, cleaning and maintenance costs.

Real Estate Taxes

Higher real estate taxes primarily attributable to the inclusion of real estate taxes from our recently acquired multifamily properties.

Depreciation and Amortization

    

The decrease in depreciation and amortization reflects write-offs primarily related to one tenant in the third quarter 2021.

Interest Income

    The increase reflects higher interest rates in the three months ended September 30, 2022 compared to the three months ended September 30, 2021.

Interest Expense

The increase was primarily attributable to interest expense from our recently acquired multifamily properties, partially offset by the cancellation of debt from 383 Main Avenue, Norwalk CT.

Income Taxes

The increase in income tax expense was attributable to higher net operating income for the observatory segment.

31

---

Nine Months Ended September 30, 2022 Compared to the Nine Months Ended September 30, 2021

The following table summarizes our historical results of operations for the nine months ended September 30, 2022 and 2021 (dollars in thousands):

			Nine Months Ended September 30,
			2022						2021						Change						%
Revenues:
Rental revenue			$	445,143					$	420,586					$	24,557					5.8		%
Observatory revenue			73,660						23,758						49,902						210.0		%
Lease termination fees			20,032						15,949						4,083						25.6		%
Third-party management and other fees			1,025						917						108						11.8		%
Other revenues and fees			5,908						2,550						3,358						131.7		%
Total revenues			545,768						463,760						82,008						17.7		%
Operating expenses:
Property operating expenses			118,875						92,429						(26,446)						(28.6)		%
Ground rent expenses			6,994						6,994						—						—		%
General and administrative expenses			45,287						42,369						(2,918)						(6.9)		%
Observatory expenses			22,507						16,226						(6,281)						(38.7)		%
Real estate taxes			91,637						92,367						730						0.8		%
Depreciation and amortization			172,394						155,339						(17,055)						(11.0)		%
Total operating expenses			457,694						405,724						(51,970)						(12.8)		%
Operating income			88,074						58,036						30,038						51.8		%
Other income (expense):
Interest income			2,144						497						1,647						331.4		%
Interest expense			(75,572)						(70,553)						(5,019)						(7.1)		%
Loss on early extinguishment of debt			—						(214)						214						100.0		%
Gain on disposition of property			27,170						—						27,170						100.0		%
Income (loss) before income taxes			41,816						(12,234)						54,050						441.8		%
Income tax (expense) benefit			(224)						3,271						(3,495)						(106.8)		%
Net income (loss)			41,592						(8,963)						50,555						564.0		%
Private perpetual preferred unit distributions			(3,151)						(3,151)						—						—		%
Net loss attributable to non-controlling interests in other partnerships			271						—						271						100.0		%
Net income (loss) attributable to common unitholders			$	38,712					$	(12,114)					$	50,826					419.6		%

Rental Revenue

    The increase in rental revenue reflects the inclusion of revenue from our multifamily properties which were acquired on December 22, 2021.

Observatory Revenue

Observatory revenues were higher driven by increased visitation.

Other Revenues and Fees

The increase in other revenues and fees was due to higher food and beverage sales, insurance claim income, parking income and bad debt recovery income.

32

---

Property Operating Expenses

The increase in property operating expenses reflects higher payroll, utilities, repairs and maintenance costs, cleaning and other operating expenses, and the inclusion of operating expenses from our recently acquired multifamily properties.

General and Administrative Expenses

The increase in general and administrative expenses reflects higher equity compensation and payroll costs, information technology costs and professional fees.

Observatory Expenses

The increase in observatory expenses was driven by increased operating hours, which increased variable costs such as labor, union, security, cleaning and maintenance costs.

Depreciation and Amortization

    

    The increase in depreciation and amortization reflects accelerated depreciation at one property due to an impairment charge in the fourth quarter of 2021 and additional depreciation from our recently acquired multifamily properties.

Interest Income

    The increase reflects higher interest rates in the nine months ended September 30, 2022 compared to the nine months ended September 30, 2021.

Interest Expense

The increase was primarily attributable to interest expense from our recently acquired multifamily properties, partially offset by the cancellation of debt from 383 Main Avenue, Norwalk CT.

Income Taxes

The increase in income tax expense was attributable to higher net operating income for the observatory segment.

Gain on disposition of property

Represents a gain on the transfer of 383 Main Avenue, Norwalk CT, which was encumbered by a $30.0 million mortgage, back to the lender in a consensual foreclosure.

Liquidity and Capital Resources

Liquidity is a measure of our ability to meet potential cash requirements, including ongoing commitments to repay borrowings, fund and maintain our assets and operations, including lease-up costs, fund our redevelopment and repositioning programs, acquire properties, make distributions to our securityholders and fulfill other general business needs. Based on the historical experience of our management and our business strategy, in the foreseeable future we anticipate we will generate positive cash flows from operations. In order for ESRT to qualify as a REIT, ESRT is required under the Internal Revenue Code of 1986 to distribute to its stockholders, on an annual basis, at least 90% of its REIT taxable income, determined without regard to the deduction for dividends paid and excluding net capital gains. We expect to make quarterly distributions, as required, to our securityholders.

While we may be able to anticipate and plan for certain liquidity needs, there may be unexpected increases in uses of cash that are beyond our control and which would affect our financial condition and results of operations. For example, we may be required to comply with new laws or regulations that cause us to incur unanticipated capital expenditures for our properties, thereby increasing our liquidity needs. Even if there are no material changes to our anticipated liquidity requirements, our sources of liquidity may be fewer than, and the funds available from such sources may be less than, anticipated or needed. Our primary sources of liquidity will generally consist of cash on hand and cash generated from our operating activities, debt issuances and unused borrowing capacity under our unsecured revolving credit facility. We expect to meet our short-term liquidity requirements, including distributions, operating expenses, working capital, debt service, and capital expenditures from cash flows from operations, cash on hand, debt issuances, and available borrowing capacity under our unsecured revolving credit facility. The availability of these borrowings is subject to the conditions set forth in the applicable

33

---

loan agreements. We expect to meet our long-term capital requirements, including acquisitions, redevelopments and capital expenditures through our cash flows from operations, cash on hand, our unsecured revolving credit facility, mortgage financings, debt issuances, common and/or preferred equity issuances and asset sales. Our properties require periodic investments of capital for individual lease related tenant improvements allowances, general capital improvements and costs associated with capital expenditures. Our overall leverage will depend on our mix of investments and the cost of leverage. ESRT's charter does not restrict the amount of leverage that we may use.

At September 30, 2022, we had $387.2 million available in cash and cash equivalents, and $850 million available under our unsecured revolving credit facility.

As of September 30, 2022, we had approximately $2.3 billion of total consolidated indebtedness outstanding, with a weighted average interest rate of 3.9% and a weighted average maturity of 6.7 years. As of September 30, 2022, excluding principal amortization, we have no outstanding debt maturing until November 2024. 

Unsecured Revolving Credit and Term Loan Facilities

See "Financial Statements - Note 5. Debt" for a summary of our unsecured revolving credit and term loan facilities.

Mortgage Debt

As of September 30, 2022, our consolidated mortgage notes payable amounted to $933.1 million. The first maturity is in November 2024. See "Financial Statements - Note 5. Debt" for more information on mortgage debt.

Senior Unsecured Notes

    

The terms of the senior unsecured notes include customary covenants, including limitations on liens, investment, distributions, debt, fundamental changes, and transactions with affiliates and require certain customary financial reports. It also requires compliance with financial ratios including a maximum leverage ratio, a maximum secured leverage ratio, a minimum fixed charge coverage ratio, a minimum unencumbered interest coverage ratio, and a maximum unsecured leverage ratio. The agreements also contain customary events of default (subject in certain cases to specified cure periods), including but not limited to non-payment, breach of covenants, representations or warranties, cross defaults, bankruptcy or other insolvency events, judgments, ERISA events, the occurrence of certain change of control transactions and loss of real estate investment trust qualification. As of September 30, 2022, we were in compliance with the covenants under the outstanding senior unsecured notes.

Financial Covenants

As of September 30, 2022, we were in compliance with the following financial covenants:

Financial covenant			Required			September 30, 2022			In Compliance
Maximum total leverage			< 60%			39.0		%	Yes
Maximum secured leverage			< 40%			15.6		%	Yes
Minimum fixed charge coverage			> 1.50x			2.6x			Yes
Minimum unencumbered interest coverage			> 1.75x			4.7x			Yes
Maximum unsecured leverage			< 60%			28.5		%	Yes

Leverage Policies

We expect to employ leverage in our capital structure in amounts determined from time to time by ESRT's board of directors. Although ESRT's board of directors has not adopted a policy that limits the total amount of indebtedness that we may incur, we anticipate that ESRT's board of directors will consider a number of factors in evaluating our level of indebtedness from time to time, as well as the amount of such indebtedness that will be either fixed or floating rate. ESRT's charter and bylaws do not limit the amount or percentage of indebtedness that we may incur nor do they restrict the form in which our indebtedness will be taken (including, but not limited to, recourse or non-recourse debt and cross-collateralized debt). Our overall leverage will depend on our mix of investments and the cost of leverage. ESRT's board of directors may from time to time modify our leverage policies in light of the then-current economic conditions, relative costs of debt and equity capital, market values of our properties, general market conditions for debt and equity securities, fluctuations in the market price of ESRT's common stock and our traded OP units, growth and acquisition opportunities and other factors.

34

---

Capital Expenditures

The following tables summarize our leasing commission costs, tenant improvement costs and our capital expenditures for each of the periods presented (dollars in thousands, except per square foot amounts).

Office Properties(1)

			Nine Months Ended September 30,
Total New Leases, Expansions, and Renewals			2022						2021
Number of leases signed(2)			103						88
Total square feet			928,598						614,328
Leasing commission costs per square foot(3)			$	19.14					$	17.10
Tenant improvement costs per square foot(3)			59.20						59.80
Total leasing commissions and tenant improvement costs per square foot(3)			$	78.34					$	76.90

Retail Properties(4)

			Nine Months Ended September 30,
Total New Leases, Expansions, and Renewals			2022						2021
Number of leases signed(2)			12						7
Total square feet			45,655						16,382
Leasing commission costs per square foot(3)			$	59.85					$	42.88
Tenant improvement costs per square foot(3)			53.97						36.18
Total leasing commissions and tenant improvement costs per square foot(3)			$	113.82					$	79.06

_______________

(1)Excludes an aggregate of 497,235 and 504,284 rentable square feet of retail space in our Manhattan office properties in 2022 and 2021, respectively. Includes the Empire State Building broadcasting licenses and observatory operations.

(2)Presents a renewed and expansion lease as one lease signed.

(3)Presents all tenant improvement and leasing commission costs as if they were incurred in the period in which the lease was signed, which may be different than the period in which they were actually paid.

(4)Includes an aggregate of 497,235 and 504,284 rentable square feet of retail space in our Manhattan office properties in 2022 and 2021, respectively. Excludes the Empire State Building broadcasting licenses and observatory operations.

			Nine Months Ended September 30,
			2022						2021
Total Portfolio
Capital expenditures (1)			$	28,823					$	15,552

_______________

(1)Excludes tenant improvements and leasing commission costs.

As of September 30, 2022, we expect to incur additional costs relating to obligations under existing lease agreements of approximately $117.9 million for tenant improvements and leasing commissions. We intend to fund the tenant improvements and leasing commission costs through a combination of operating cash flow, cash on hand, additional property level mortgage financings and borrowings under the unsecured revolving credit facility.

Capital expenditures are considered part of both our short-term and long-term liquidity requirements. We intend to fund capital improvements through a combination of operating cash flow, cash on hand and borrowings under the unsecured revolving credit facility.

Off-Balance Sheet Arrangements

As of September 30, 2022, we did not have any off-balance sheet arrangements.

35

---

Distribution Policy

We intend to distribute our net taxable income to our security holders in a manner intended to satisfy REIT distribution requirements and to avoid U.S. federal income tax liability on our income.

Before we pay any distribution, whether for U.S. federal income tax purposes or otherwise, we must first meet both our operating requirements and obligations to make payments of principal and interest, if any. However, under some circumstances, we may be required to use cash reserves, incur debt or liquidate assets at rates or times that we regard as unfavorable or make a taxable distribution of our shares in order to satisfy REIT distribution requirements.

Distribution to Equity Holders

Distributions and dividends amounting to $32.2 million and $22.6 million have been made to equity holders for the nine months ended September 30, 2022 and 2021, respectively.

Stock and Publicly Traded Operating Partnership Unit Repurchase Program

    ESRT's Board of Directors authorized the repurchase of up to $500 million of ESRT Class A common stock and the Operating Partnership’s Series ES, Series 250 and Series 60 operating partnership units through December 31, 2023. Under the program, ESRT may purchase ESRT Class A common stock and we may purchase our Series ES, Series 250 and Series 60 operating partnership units in accordance with applicable securities laws from time to time in the open market or in privately negotiated transactions. The timing, manner, price and amount of any repurchases will be determined by ESRT and us at our discretion and will be subject to stock price, availability, trading volume and general market conditions. The authorization does not obligate ESRT or us to acquire any particular amount of securities, and the program may be suspended or discontinued at ESRT and our discretion without prior notice. See "Financial Statements - Note 10. Capital" for a summary of ESRT's purchases of equity securities in each of the three months ended September 30, 2022.

Cash Flows

Comparison of Nine Months Ended September 30, 2022 to the Nine Months Ended September 30, 2021

Net cash. Cash and cash equivalents and restricted cash were $439.8 million and $621.0 million, respectively, as of September 30, 2022 and 2021. The decrease was primarily due to the acquisition of real estate property at the end of 2021 and higher spending for capital expenditures, higher repurchases of common shares and higher dividends paid in 2022.

Operating activities. Net cash provided by operating activities increased by $7.0 million to $174.0 million.

Investing activities. Net cash used in investing activities increased by $18.3 million to $89.1 million due to higher capital expenditures.

Financing activities. Net cash used in financing activities increased by $76.5 million to $119.7 million primarily due to higher repurchases of common shares and higher dividends and distributions.

Net Operating Income ("NOI")

Our financial reports include a discussion of property net operating income, or NOI. NOI is a non-GAAP financial measure of performance. NOI is used by our management to evaluate and compare the performance of our properties and to determine trends in earnings and to compute the fair value of our properties as it is not affected by: (i) the cost of funds of the property owner, (ii) the impact of depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets that are included in net income computed in accordance with GAAP, (iii) acquisition expenses, loss on early extinguishment of debt and loss from derivative financial instruments, or (iv) general and administrative expenses and other gains and losses that are specific to the property owner. The cost of funds is eliminated from NOI because it is specific to the particular financing capabilities and constraints of the owner and because it is dependent on historical interest rates and other costs of capital as well as past decisions made by us regarding the appropriate mix of capital which may have changed or may change in the future. Depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets are eliminated because they may not accurately represent the actual change in value in our office or retail properties that result from use of the properties or changes in market conditions. While certain aspects of real property do decline in value over time in a manner that is reasonably captured by depreciation and amortization, the value of the properties as a whole have historically increased or decreased as a result of changes in overall economic conditions instead of from actual use of the property or the passage of time. Gains and losses from the sale of real

36

---

property vary from property to property and are affected by market conditions at the time of sale which will usually change from period to period. These gains and losses can create distortions when comparing one period to another or when comparing our operating results to the operating results of other real estate companies that have not made similarly-timed purchases or sales. We believe that eliminating these costs from net income is useful to investors because the resulting measure captures the actual revenue, generated and actual expenses incurred in operating our properties as well as trends in occupancy rates, rental rates and operating costs.

However, the usefulness of NOI is limited because it excludes general and administrative costs, interest expense, depreciation and amortization expense and gains or losses from the sale of properties, and other gains and losses as stipulated by GAAP, the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, all of which are significant economic costs. NOI may fail to capture significant trends in these components of net income which further limits its usefulness.

    NOI is a measure of the operating performance of our properties but does not measure our performance as a whole. NOI is therefore not a substitute for net income as computed in accordance with GAAP. This measure should be analyzed in conjunction with net income computed in accordance with GAAP and discussions elsewhere in this Management’s Discussion and Analysis of Financial Condition and Results of Operations regarding the components of net income that are eliminated in the calculation of NOI. Other companies may use different methods for calculating NOI or similarly titled measures and, accordingly, our NOI may not be comparable to similarly titled measures reported by other companies that do not define the measure exactly as we do.

The following table presents a reconciliation of our net income, the most directly comparable GAAP measure, to NOI for the periods presented (amounts in thousands):

			Three Months Ended September 30,												Nine Months Ended September 30,
			2022						2021						2022						2021
			(unaudited)												(unaudited)
Net income (loss)			$	10,118					$	(10,183)					$	41,592					$	(8,963)
Add:
General and administrative expenses			15,725						14,427						45,287						42,369
Depreciation and amortization			46,984						65,794						172,394						155,339
Interest expense			25,516						23,577						75,572						70,553
Loss on early extinguishment of debt			—						—						—						214
Income tax expense (benefit)			1,457						20						224						(3,271)
Less:
Gain on disposition of property			—						—						(27,170)						—
Third-party management and other fees			(389)						(314)						(1,025)						(917)
Interest income			(1,564)						(211)						(2,144)						(497)
Net operating income			$	97,847					$	93,110					$	304,730					$	254,827
Other Net Operating Income Data
Straight-line rental revenue			$	7,341					$	3,087					$	18,533					$	13,197
Net increase in rental revenue from the amortization of above-and below-market lease assets and liabilities			$	677					$	4,244					$	4,136					$	5,615
Amortization of acquired below-market ground leases			$	1,957					$	1,957					$	5,873					$	5,873

Funds from Operations ("FFO")

    We present below a discussion of FFO. We compute FFO in accordance with the “White Paper” on FFO published by the National Association of Real Estate Investment Trusts, or NAREIT, which defines FFO as net income (loss) (determined in accordance with GAAP), excluding impairment write-off of investments in depreciable real estate and investments in in-substance real estate investments, gains or losses from debt restructurings and sales of depreciable operating properties, plus real estate-related depreciation and amortization (excluding amortization of deferred financing costs), less distributions to non-controlling interests and gains/losses from discontinued operations and after adjustments for unconsolidated partnerships and joint ventures. FFO is a widely recognized non-GAAP financial measure for REITs that we

37

---

believe, when considered with financial statements determined in accordance with GAAP, is useful to investors in understanding financial performance and providing a relevant basis for comparison among REITs. In addition, we believe FFO is useful to investors as it captures features particular to real estate performance by recognizing that real estate has generally appreciated over time or maintains residual value to a much greater extent than do other depreciable assets. Investors should review FFO, along with GAAP net income, when trying to understand an equity REIT’s operating performance. We present FFO because we consider it an important supplemental measure of our operating performance and believe that it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs. However, because FFO excludes depreciation and amortization and captures neither the changes in the value of our properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effect and could materially impact our results of operations, the utility of FFO as a measure of performance is limited. There can be no assurance that FFO presented by us is comparable to similarly titled measures of other REITs. FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions. Although FFO is a measure used for comparability in assessing the performance of REITs, as the NAREIT White Paper only provides guidelines for computing FFO, the computation of FFO may vary from one company to another.

Modified Funds From Operations ("Modified FFO")

    Modified FFO adds back an adjustment for any above or below-market ground lease amortization to traditionally defined FFO. We believe this a useful supplemental measure in evaluating our operating performance due to the non-cash accounting treatment under GAAP, which stems from the third quarter 2014 acquisition of two option properties following our formation transactions as they carry significantly below market ground leases, the amortization of which is material to our overall results. We present Modified FFO because we believe it is an important supplemental measure of our operating performance in that it adds back the non-cash amortization of below-market ground leases. There can be no assurance that Modified FFO presented by us is comparable to similarly titled measures of other REITs. Modified FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. Modified FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions.

Core Funds From Operations

    Core FFO adds back to Modified FFO the following items: IPO litigation expense, severance expenses and loss on early extinguishment of debt. The company believes Core FFO is an important supplemental measure of its operating performance because it excludes items associated with its IPO and formation transactions and other non-recurring items. There can be no assurance that Core FFO presented by the company is comparable to similarly titled measures of other REITs. Core FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income (loss) determined in accordance with GAAP or to cash flow from operating activities determined in accordance with GAAP. Core FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions. In future periods, we may also exclude other items from Core FFO that we believe may help investors compare our results.

The following table presents a reconciliation of our net income, the most directly comparable GAAP measure, to FFO, Modified FFO and Core FFO for the periods presented (amounts in thousands):

38

---

			Three Months Ended September 30,												Nine Months Ended September 30,
			2022						2021						2022						2021
			(unaudited)												(unaudited)
Net income (loss)			$	10,118					$	(10,183)					$	41,592					$	(8,963)
Noncontrolling interests in other partnerships			49						—						271						—
Private perpetual preferred unit distributions			(1,050)						(1,050)						(3,151)						(3,151)
Real estate depreciation and amortization			45,461						64,565						167,446						151,149
Gain on disposition of property			—						—						(27,170)						—
FFO attributable to common unitholders			54,578						53,332						178,988						139,035
Amortization of below-market ground leases			1,957						1,957						5,873						5,873
Modified FFO attributable to common unitholders			56,535						55,289						184,861						144,908
Loss on early extinguishment of debt			—						—						—						214
Core FFO attributable to common unitholders			$	56,535					$	55,289					$	184,861					$	145,122
Weighted average Operating Partnership units
Basic			266,035						277,716						269,880						277,829
Diluted			267,121						277,716						270,966						277,829

Factors That May Influence Future Results of Operations

Portfolio Transaction Activity

Subsequent to September 30, 2022, we entered into agreements to sell 500 Mamaroneck Avenue in Harrison, NY and 10 Bank Street in White Plains, NY at a gross asset valuation of $95.0 million. These transactions are expected to close in the first quarter of 2023, subject to customary closing conditions.

Leasing

    Due to the relatively small number of leases that are signed in any particular quarter, one or more larger leases may have a disproportionately positive or negative impact on average rent, tenant improvement and leasing commission costs for that period. As a result, we believe it is more appropriate when analyzing trends in average rent and tenant improvement and leasing commission costs to review activity over multiple quarters or years. Tenant improvement costs include expenditures for general improvements occurring concurrently with, but that are not directly related to, the cost of installing a new tenant. Leasing commission costs are similarly subject to significant fluctuations depending upon the length of leases being signed and the mix of tenants from quarter to quarter.

    As of September 30, 2022, there were approximately 1.1 million rentable square feet of space in our portfolio available to lease (excluding leases signed but not yet commenced) representing 11.5% of the net rentable square footage of the properties in our portfolio. In addition, leases representing 1.4% and 5.5% of net rentable square footage of the properties in our portfolio will expire in 2022 and in 2023, respectively. These leases are expected to represent approximately 1.6% and 6.4%, respectively, of our annualized rent for such periods. Our revenues and results of operations can be impacted by expiring leases that are not renewed or re-leased or that are renewed or re-leased at base rental rates equal to, above or below the current average base rental rates. Further, our revenues and results of operations can also be affected by the costs we incur to re-lease available space, including payment of leasing commissions, redevelopments and build-to-suit remodeling that may not be borne by the tenant.

    Despite the challenge of the uncertain near-term environment, we continue to believe that as we have largely completed the redevelopment and repositioning of our properties we will, over the long-term, experience increased occupancy levels and rental revenues. Over the short-term, as we renovate and reposition our properties, including aggregating smaller spaces to offer large blocks of space, we may experience lower occupancy levels as a result of having to relocate tenants to alternative space and the strategic expiration of existing leases. We believe that despite the short-term lower occupancy levels we may experience, we will continue to obtain better quality tenants, whom have higher likelihood for growth within the portfolio, following the redevelopment and repositioning of our properties.

39

---

Observatory Operations

For the three months ended September 30, 2022, the observatory hosted 687,000 visitors, compared to 255,000 visitors for the same period in 2021. Our return of attendance to pre-COVID-19 levels is closely tied to national and international travel trends and these remain adversely impacted by developments around the COVID-19 pandemic.    

    Observatory revenue for the three months ended September 30, 2022 was $33.1 million, compared to $12.8 million for the three months ended September 30, 2021. Observatory revenues and admissions are dependent upon the following: (i) the number of tourists (domestic and international) who come to New York City and visit the observatory, as well as any related tourism trends; (ii) the prices per admission that can be charged; (iii) seasonal trends affecting the number of visitors to the observatory; (iv) competition, in particular from other new and existing observatories; and (v) weather trends.

Critical Accounting Estimates

    Refer to our Annual Report on Form 10-K for the year ended December 31, 2021 for a discussion of our critical accounting estimates. There were no material changes to our critical accounting estimates disclosed in our Annual Report on Form 10-K for the year ended December 31, 2021.

40

---

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our future income, cash flows and fair values relevant to financial instruments are dependent upon prevalent market interest rates. We are exposed to interest rate changes primarily on our unsecured revolving credit facility and debt refinancings. In order to mitigate our interest rate risk, we may borrow at fixed rates or may enter into derivative financial instruments such as interest rate swaps or caps on floating rate financial instruments. We are not subject to foreign currency risk and we do not enter into derivative or interest rate transactions for speculative purposes.

    As of September 30, 2022, we have interest rate LIBOR swap and cap agreements and SOFR swap agreements with an aggregate notional value of $576.3 million and which mature between October 1, 2024 and November 1, 2033. These "variable to fixed" interest rate swaps have been designated as cash flow hedges and are deemed highly effective with fair values of $18.5 million which is included in prepaid assets and other expenses on the condensed consolidated balance sheet as of September 30, 2022. Given the phasing out of LIBOR, we have entered into SOFR swap agreements to begin the replacement of our LIBOR swap agreements. We will continue to work with our lenders and counterparties to replace or modify, as appropriate, the interest rate provisions in our other LIBOR swap and cap agreements.

     As of September 30, 2022, the weighted average interest rate on the $2.3 billion of fixed-rate indebtedness outstanding was 3.9% per annum, with maturities at various dates through March 17, 2035.

As of September 30, 2022, the fair value of our outstanding debt was approximately $2.1 billion, which was approximately $215.0 million less than the book value as of such date. Interest risk amounts were determined by considering the impact of hypothetical interest rates on our financial instruments. These analyses do not consider the effect of any change in overall economic activity that could occur in that environment. Further, in the event of a change of that magnitude, we may take actions to further mitigate our exposure to the change. However, due to the uncertainty of the specific actions that would be taken and their possible effects, these analyses assume no changes in our financial structure.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

    We maintain disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in our reports under the Exchange Act is processed, recorded, summarized and reported within the time periods specified in the SEC’s rules and regulations and that such information is accumulated and communicated to management, including ESRT's Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

    As of September 30, 2022, the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of ESRT management, including ESRT's Chief Executive Officer and Chief Financial Officer, regarding the effectiveness of our disclosure controls and procedures at the end of the period covered by this report. Based on the foregoing, ESRT's Chief Executive Officer and Chief Financial Officer concluded, as of that time, that our disclosure controls and procedures were effective in ensuring that information required to be disclosed by us in reports filed or submitted under the Exchange Act (i) is processed, recorded, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) is accumulated and communicated to our management, including ESRT's Chief Executive Officer and Chief Financial Officer, as appropriate to allow for timely decisions regarding required disclosure.     

Changes in Internal Control over Financial Reporting

    No changes to our internal control over financial reporting were identified in connection with the evaluation referenced above that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

41

---

    See Note 9 to the Condensed Consolidated Financial Statements for a description of legal proceedings.

ITEM 1A. RISK FACTORS

    There have been no material changes to the risk factors included in the section entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Recent Sales of Unregistered Securities

     None.

Recent Purchases of Equity Securities

Stock and Publicly Traded Operating Partnership Unit Repurchase Program

     ESRT's Board of Directors authorized the repurchase of up to $500 million of our Class A common stock and the Operating Partnership’s Series ES, Series 250 and Series 60 operating partnership units during the period from January 1, 2022 through December 31, 2023. This replaces an earlier $500.0 million repurchase authorization that ran from January 1, 2021 through December 31, 2021. Under the program, ESRT may purchase our Class A common stock and we may purchase our Series ES, Series 250 and Series 60 operating partnership units in accordance with applicable securities laws from time to time in the open market or in privately negotiated transactions. The timing, manner, price and amount of any repurchases will be determined by ESRT and us and will be subject to stock price, availability, trading volume, general market conditions, and applicable securities laws. The authorization does not obligate ESRT or us to acquire any particular amount of securities, and the program may be suspended or discontinued at ESRT and our discretion without prior notice. As of September 30, 2022, we had approximately $417.5 million remaining of the authorized repurchase amount.

The following table summarizes ESRT's repurchases of equity securities in each of the months in the three month period ended September 30, 2022 under the repurchase program described above:

Period			Total Number of Shares Purchased						Weighted Average Price Paid per Share						Total Number of Shares Purchased As Part of Publicly Announced Plans or Programs						Maximum Approximate Dollar Value Available for Future Purchase (in thousands)
July 1-31, 2022			184,045						$	6.92					184,045						$	434,286
August 1-31, 2022			621,314						$	7.32					621,314						$	429,736
September 1-30, 2022			1,761,561						$	6.97					1,761,561						$	417,455

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable.

ITEM 5. OTHER INFORMATION

     None.

42

---

ITEM 6. EXHIBITS

    

Exhibit No.			Description
10.62*			Second Amendment, dated as of August 29, 2022, to that certain Credit Agreement, dated as of March 19, 2020, among Empire State Realty Trust, Inc., Empire State Realty OP, L.P., the subsidiary guarantors party thereto, the lenders party thereto, and Wells Fargo Bank, National Association, as administrative agent.
10.63*			Third Amendment, dated as of August 29, 2022, to that certain Amended and Restated Credit Agreement, dated August 29, 2017, among Empire State Realty Trust, Inc., Empire State Realty OP, L.P. , the subsidiary guarantors party thereto, the lenders party thereto, and Bank of America, N.A. , as administrative agent.
31.1*			Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*			Certification of Principal Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*			Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*			Certification of Principal Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*			XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH*			XBRL Taxonomy Extension Schema Document
101.CAL*			XBRL Taxonomy Extension Calculation Document
101.DEF*			XBRL Taxonomy Extension Definitions Document
101.LAB*			XBRL Taxonomy Extension Labels Document
101.PRE*			XBRL Taxonomy Extension Presentation Document
104			Cover Page Interactive Data File (contained in Exhibit 101)
Notes:
* Filed herewith.

43

---

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

EMPIRE STATE REALTY OP, L.P.

By: Empire State Realty Trust, Inc., its general partner

Date:			November 3, 2022						By:/s/ Christina Chiu
									Executive Vice President and
									Chief Financial Officer
									(Principal Financial Officer)
Date:			November 3, 2022						By: /s/ Stephen V. Horn
									Senior Vice President,
									Chief Accounting Officer
									(Principal Accounting Officer)

44