10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2013

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

For the transition period from                to              

Commission File Number: 033-84580

RECKSON OPERATING PARTNERSHIP, L.P.

(Exact name of registrant as specified in its charter)

Delaware	11-3233647
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

420 Lexington Avenue, New York, New York 10170

(Address of principal executive offices) (Zip Code)

(212) 594-2700

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  YES x     NO o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES x    NO o

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

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  YES o  NO x

As of July 31, 2013, no common units of limited partnership interest of the Registrant were held by non-affiliates of the Registrant.  There is no established trading market for such units.

RECKSON OPERATING PARTNERSHIP, L.P.

INDEX

		PAGE
PART I.	FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS
	Consolidated Balance Sheets as of June 30, 2013 (unaudited) and December 31, 2012	3
	Consolidated Statements of Income for the three and six months ended June 30, 2013 and 2012 (unaudited)	4
	Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2013 and 2012 (unaudited)	5
	Consolidated Statement of Capital for the six months ended June 30, 2013 (unaudited)	6
	Consolidated Statements of Cash Flows for the six months ended June 30, 2013 and 2012 (unaudited)	7
	Notes to Consolidated Financial Statements (unaudited)	8
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	22
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	32
ITEM 4.	CONTROLS AND PROCEDURES	32
PART II.	OTHER INFORMATION	33
ITEM 1.	LEGAL PROCEEDINGS	33
ITEM 1A.	RISK FACTORS	33
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	33
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	33
ITEM 4.	MINE SAFETY DISCLOSURES	33
ITEM 5.	OTHER INFORMATION	33
ITEM 6.	EXHIBITS	34
SIGNATURES		35

2

PART I.FINANCIAL INFORMATION

ITEM 1.Financial Statements

Reckson Operating Partnership, L.P.

Consolidated Balance Sheets

(in thousands)

	June 30, 2013			December 31, 2012
	(Unaudited)
Assets
Commercial real estate properties, at cost:
Land and land interests	$	918,019		$	954,731
Building and improvements	3,498,649			3,646,736
Building leasehold and improvements	782,260			782,260
Property under capital lease	22,866			12,208
	5,221,794			5,395,935
Less: accumulated depreciation	(782,949		)	(742,659		)
	4,438,845			4,653,276
Assets held for sale	194,097			—
Cash and cash equivalents	27,197			34,035
Restricted cash	22,765			21,074
Tenant and other receivables, net of allowance of $5,719 and $7,308 in 2013 and 2012, respectively	15,196			13,147
Deferred rents receivable, net of allowance of $14,887 and $16,501 in 2013 and 2012, respectively	151,645			150,535
Preferred equity and other investment, net of discounts and deferred origination fees of $2,156 and $2,217 in 2013 and 2012, respectively	371,735			338,579
Deferred costs, net of accumulated amortization of $45,644 and $40,303 in 2013 and 2012, respectively	82,838			91,400
Other assets	83,233			94,210
Total assets	$	5,387,551		$	5,396,256
Liabilities
Mortgage note and other loans payable	$	550,023		$	550,023
Revolving credit facility	40,000			70,000
Term loan and senior unsecured notes	1,430,741			1,430,690
Accrued interest payable and other liabilities	25,751			25,366
Accounts payable and accrued expenses	37,403			50,692
Deferred revenue	155,870			173,814
Capitalized lease obligation	26,963			17,186
Deferred land leases payable	19,500			20,566
Security deposits	21,209			18,411
Total liabilities	2,307,460			2,356,748
Commitments and contingencies	—			—
Capital
General partner capital	2,730,260			2,686,766
Limited partner capital	—			—
Accumulated other comprehensive loss	(4,255		)	(4,925		)
Total ROP partner’s capital	2,726,005			2,681,841
Noncontrolling interests in other partnerships	354,086			357,667
Total capital	3,080,091			3,039,508
Total liabilities and capital	$	5,387,551		$	5,396,256

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

3

Reckson Operating Partnership, L.P.

Consolidated Statements of Income

(unaudited,  in thousands)

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
Revenues
Rental revenue, net	$	110,392		$	104,168		$	220,088		$	207,363
Escalation and reimbursement	17,332			18,436			35,436			37,097
Investment income	9,731			—			19,196			—
Other income	1,005			903			2,981			1,862
Total revenues	138,460			123,507			277,701			246,322
Expenses
Operating expenses, including approximately $4,118 and $8,499 (2013) and $4,088 and $7,891 (2012) paid to related parties	28,571			26,369			58,769			54,448
Real estate taxes	22,488			22,453			45,853			44,367
Ground rent	3,430			3,645			9,202			7,290
Interest expense, net of interest income	27,584			26,586			54,313			54,480
Amortization of deferred finance costs	1,287			647			2,585			2,006
Loan loss reserves, net of recoveries	—			—			—			(472		)
Transaction related costs	—			861			11			861
Depreciation and amortization	35,386			32,849			71,070			65,663
Marketing, general and administrative	122			127			188			132
Total expenses	118,868			113,537			241,991			228,775
Income from continuing operations before depreciable real estate reserve, net of recoveries, equity in net income from unconsolidated joint venture, and loss on early extinguishment of debt	19,592			9,970			35,710			17,547
Depreciable real estate reserve, net of recoveries	—			5,789			—			5,789
Equity in net income from unconsolidated joint venture	481			660			847			786
Loss on early extinguishment of debt	(10		)	—			(76		)	—
Income from continuing operations	20,063			16,419			36,481			24,122
Net income from discontinued operations	1,720			1,036			2,886			2,197
Net income	21,783			17,455			39,367			26,319
Net income attributable to noncontrolling interests in other partnerships	(1,599		)	(2,067		)	(3,112		)	(3,440		)
Net income attributable to ROP common unitholder	$	20,184		$	15,388		$	36,255		$	22,879
Amounts attributable to ROP common unitholders:
Income from continuing operations	$	18,464		$	14,352		$	33,369		$	20,682
Discontinued operations	1,720			1,036			2,886			2,197
Net income	$	20,184		$	15,388		$	36,255		$	22,879

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

4

Reckson Operating Partnership, L.P.

Consolidated Statement of Comprehensive Income

(unaudited, in thousands)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2013			2012			2013			2012
Net income	$	20,184		$	15,388		$	36,255		$	22,879
Other comprehensive income (loss):
Net unrealized loss on derivative instruments	(231		)	(434		)	(193		)	(538		)
Reclassification of net realized (gain) loss on derivatives designated as cashflow hedges into interest expense	(230		)	245			(477		)	489
Other comprehensive loss	(461		)	(189		)	(670		)	(49		)
Comprehensive income attributable to ROP common unitholder	$	19,723		$	15,199		$	35,585		$	22,830

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

5

Reckson Operating Partnership, L.P.

Consolidated Statement of Capital

(unaudited, in thousands)

	General Partner’s Capital Class A Common Units			Noncontrolling Interests In Other Partnerships			Accumulated Other Comprehensive Loss			Total Capital
Balance at December 31, 2012	$	2,686,766		$	357,667		$	(4,925	)	$	3,039,508
Contributions	668,142			—						668,142
Distributions	(660,903		)	(6,693		)				(667,596		)
Net income	36,255			3,112						39,367
Other comprehensive income							670			670
Balance at June 30, 2013	$	2,730,260		$	354,086		$	(4,255	)	$	3,080,091

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

6

Reckson Operating Partnership, L.P.

Consolidated Statements of Cash Flows

(unaudited, in thousands)

	Six Months Ended June 30,
	2013			2012
				As Adjusted
Operating Activities
Net income	$	39,367		$	26,319
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	76,642			70,572
Equity in net income from unconsolidated joint venture	(847		)	(786		)
Distributions of cumulative earnings from unconsolidated joint venture	336			444
Depreciable real estate reserve, net of recoveries	—			(5,789		)
Loss on early extinguishment of debt	76			—
Loan loss reserves, net of recoveries	—			(472		)
Deferred rents receivable	(8,291		)	(10,681		)
Other non-cash adjustments	(23,243		)	(6,869		)
Changes in operating assets and liabilities:
Restricted cash — operations	(1,691		)	1,164
Tenant and other receivables	(545		)	(1,430		)
Deferred lease costs	(5,659		)	(2,231		)
Other assets	(2,567		)	(2,881		)
Accounts payable, accrued expenses and other liabilities	(4,934		)	1,044
Deferred revenue and land leases payable	1,439			(1,305		)
Net cash provided by operating activities	70,083			67,099
Investing Activities
Acquisition of real estate property	—			(102,910		)
Additions to land, buildings and improvements	(24,727		)	(22,885		)
Restricted cash — capital improvements	—			(670		)
Distributions in excess of cumulative earnings from unconsolidated joint venture	—			152
Preferred equity and other investment, net of repayments	(22,732		)	7,777
Net cash used in investing activities	(47,459		)	(118,536		)
Financing Activities
Repayments of mortgage note and other loans payable	—			(1,251		)
Proceeds from credit facility and senior unsecured notes	370,000			468,339
Repayments of credit facility and senior unsecured notes	(400,000		)	(738,639		)
Contributions from common unitholder	668,142			1,043,561
Distributions to noncontrolling interests in other partnerships	(6,693		)	(8,143		)
Distributions to common unitholder	(660,903		)	(715,400		)
Deferred loan costs and capitalized lease obligation	(8		)	(186		)
Net cash (used in) provided by financing activities	(29,462		)	48,281
Net decrease in cash and cash equivalents	(6,838		)	(3,156		)
Cash and cash equivalents at beginning of period	34,035			26,645
Cash and cash equivalents at end of period	$	27,197		$	23,489

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

7

Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

1.Organization and Basis of Presentation

Reckson Operating Partnership, L.P., or ROP, commenced operations on June 2, 1995.  The sole general partner of ROP is a wholly-owned subsidiary of SL Green Operating Partnership, L.P., or the Operating Partnership.  The sole limited partner of ROP is the Operating Partnership.

ROP is engaged in the acquisition, ownership, management and operation of commercial real estate properties, principally office properties and also owns land for future development located in the New York City, Westchester County and Connecticut, which collectively is also known as the New York Metropolitan area.

SL Green Realty Corp., or SL Green, and the Operating Partnership were formed in June 1997.  SL Green has qualified, and expects to qualify in the current fiscal year as a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended, or the Code, and operates as a self-administered, self-managed REIT.  A REIT is a legal entity that holds real estate interests and, through payments of dividends to stockholders, is permitted to minimize the payment of Federal income taxes at the corporate level.  Unless the context requires otherwise, all references to “we,” “our,” “us” and the “Company” means ROP and all entities owned or controlled by ROP.

On January 25, 2007, SL Green completed the acquisition of all of the outstanding shares of common stock of Reckson Associates Realty Corp., or RARC, the prior general partner of ROP. This transaction is referred to herein as the Merger.

In connection with the closing of our 2011 revolving credit facility and 2012 credit facility, in which we, along with SL Green and the Operating Partnership are borrowers, SL Green transferred five properties with total assets aggregating to $683.8 million at November 1, 2011 and transferred three additional properties with total assets aggregating to $320.2 million at December 31, 2012, to ROP. Under the Business Combinations guidance, these were determined to be transfers of businesses between the indirect parent company and its wholly owned subsidiary. As such, the assets and liabilities were transferred at their carrying value. These transfers are required to be recorded as of the beginning of the current reporting period as though the assets and liabilities had been transferred at that date. The financial statements and financial information presented for all prior periods have been retrospectively adjusted to furnish comparative information.

On September 30, 2012, SL Green transferred $324.9 million of its preferred equity investments to ROP, one of which was subject to a secured $50.0 million loan. Under the Business Combinations guidance, these transfers were determined to be transfers of assets between the indirect parent company and its wholly-owned subsidiary. As such, the assets were transferred at their carrying value and accounted for prospectively from the date of transfer.

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

Location	Ownership	Number of Properties	Square Feet	Weighted Average Occupancy (1)
Manhattan	Consolidated properties	13	7,201,400	96.0	%
Suburban	Consolidated properties	17	2,785,500	78.1	%
		30	9,986,900	91.0	%

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

At June 30, 2013, we also own a development property encompassing approximately 104,000 square feet as well as an inventory of development parcels that aggregated approximately 81 acres of land in four separate parcels on which we can, based on estimates at June 30, 2013, develop approximately 1.1 million square feet of office space and in which we have invested approximately $67.6 million.  As of June 30, 2013, we also held preferred equity investments and an investment in an unconsolidated joint venture that holds a preferred equity interest in a retail property located in Manhattan with an aggregate book value of $371.7 million.

8

Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

Basis of Quarterly Presentation

The accompanying consolidated financial statements include the consolidated financial position of ROP and the Service Companies (as defined below) at June 30, 2013 and December 31, 2012, the consolidated results of their operations for the three and six months ended June 30, 2013 and 2012, their statement of capital for the six months ended June 30, 2013 and their statement of cash flows for the six months ended June 30, 2013 and 2012.  Our investments in majority-owned and controlled real estate joint ventures are reflected in the accompanying financial statements on a consolidated basis with a reduction for the noncontrolling partners’ interests.  ROP’s investments in joint ventures, where it owns less than a controlling interest, are reflected in the accompanying consolidated financial statements using the equity method of accounting.  The Service Companies, which provide management, development and construction services to ROP, include Reckson Management Group, Inc., RANY Management Group, Inc., Reckson Construction & Development LLC and Reckson Construction Group New York, Inc. (collectively, the “Service Companies”).  All significant intercompany balances and transactions have been eliminated in the consolidated financial statements.

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

The balance sheet at December 31, 2012 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by U.S. GAAP for complete financial statements.

2.Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include our accounts and those of our subsidiaries, which are wholly-owned or controlled by us. Entities which we do not control through our voting interest and entities which are variable interest entities, but where we are not the primary beneficiary, are accounted for under the equity method or as preferred equity investments.  See Note 5, “Preferred Equity and Other Investment.” ROP’s investments in majority-owned and controlled real estate joint ventures are reflected in the accompanying financial statements on a consolidated basis with a reduction for the noncontrolling partners’ interests.  All significant intercompany balances and transactions have been eliminated.

We consolidate a variable interest entity, or VIE, in which we are considered the primary beneficiary. The primary beneficiary of a VIE is the entity that has (i) the power to direct the activities that most significantly impact the entity’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could be significant to the VIE.

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

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

9

Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

Investment in Commercial Real Estate Properties

On a periodic basis, we assess whether there are any indications that the value of our real estate properties may be impaired or that their carrying value may not be recoverable.  A property’s value is considered impaired if management’s estimate of the aggregate future cash flows (undiscounted and without interest charges for consolidated properties) to be generated by the property is less than the carrying value of the property.  To the extent impairment has occurred, the loss will be measured as the excess of the carrying amount of the property over the calculated fair value of the property.  In addition, we assess our investment in an unconsolidated joint venture for recoverability, and if it is determined that a loss in value of the investment is other than temporary, we write down the investment to its fair value.  We evaluate our equity investment for impairment based on the joint venture’s projected discounted cash flows.  We do not believe that the values of any of our consolidated properties or equity investment were impaired at either June 30, 2013 or December 31, 2012.

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

We recognized an increase of approximately $5.2 million, $10.7 million, $4.8 million and $9.9 million in rental revenue for the three and six months ended June 30, 2013 and 2012, respectively, for the amortization of aggregate below-market leases in excess of above-market leases and a reduction in lease origination costs, resulting from the allocation of the purchase price of the applicable properties.  We recognized an increase in interest expense for the amortization of above-market rate mortgages assumed of approximately $0.1 million, $0.2 million, $0.1 million and $0.3 million for the three and six months ended June 30, 2013 and 2012, respectively.

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

	June 30, 2013			December 31, 2012
Identified intangible assets (included in other assets):
Gross amount	$	199,845		$	199,845
Accumulated amortization	(133,257		)	(125,009		)
Net	$	66,588		$	74,836
Identified intangible liabilities (included in deferred revenue):
Gross amount	$	399,088		$	399,088
Accumulated amortization	(245,354		)	(227,637		)
Net	$	153,734		$	171,451

Investments in Unconsolidated Joint Ventures

We account for our investments in unconsolidated joint ventures under the equity method of accounting as we exercise significant influence, but do not control the entity and are not considered to be the primary beneficiary. We consolidate the joint ventures that we control or which are VIEs and where we are considered to be the primary beneficiary. In all the joint ventures, the rights of the joint venture partner are both protective as well as participating. Unless the joint venture is determined to be a VIE and we are the primary beneficiary in a VIE, these participating rights preclude us from consolidating these non-VIE entities. This investment is recorded initially at cost, as investment in unconsolidated joint venture, and subsequently adjusted for equity in net income (loss) and cash contributions and distributions. Any difference between the carrying amount of this investment on our balance sheet and the underlying equity in net assets is amortized as an adjustment to equity in net income (loss) of unconsolidated joint venture over the

10

Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

lesser of the joint venture term or 10 years. Equity income (loss) from unconsolidated joint venture is allocated based on our ownership or economic interest in the joint venture. When a capital event (as defined in each joint venture agreement) such as a refinancing occurs, if return thresholds are met, future equity income will be allocated at our increased economic interest. We recognize incentive income from unconsolidated real estate joint venture as income to the extent it is earned and not subject to a clawback feature. Distributions we receive from unconsolidated real estate joint venture in excess of our basis in the investment are recorded as offsets to our investment balance if we remain liable for future obligations of the joint venture or may otherwise be committed to provide future additional financial support. In July 2012, we, along with our joint venture partner, sold One Court Square for $481.1 million, which included the assumption of $315.0 million of existing debt by the purchaser, and recognized a gain of $1.0 million on the sale of this property. In January 2013, we, along with our joint venture partner, acquired a preferred equity interest in an entity that holds an interest in a retail property located in Manhattan. See Note 5, “Preferred Equity and Other Investment.”

Revenue Recognition

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

In addition to base rent, our tenants also generally will pay their pro rata share of increases in real estate taxes and operating expenses for the building over a base year. In some leases, in lieu of paying additional rent based upon increases in building operating expenses, the tenant will pay additional rent based upon increases in the wage rate paid to porters over the porters’ wage rate in effect during a base year or increases in the consumer price index over the index value in effect during a base year. In addition, many of our leases contain fixed percentage increases over the base rent to cover escalations.

Electricity is most often supplied by the landlord either on a sub-metered basis, or rent inclusion basis (i.e., a fixed fee is included in the rent for electricity, which amount may increase based upon increases in electricity rates or increases in electrical usage by the tenant). Base building services other than electricity (such as heat, air conditioning and freight elevator service during business hours, and base building cleaning) are typically provided at no additional cost, with the tenant paying additional rent only for services which exceed base building services or for services which are provided outside normal business hours.

These escalations are based on actual expenses incurred in the prior calendar year.  If the expenses in the current year are different from those in the prior year, then during the current year, the escalations will be adjusted to reflect the actual expenses for the current year.

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

Interest income on preferred equity investments is recognized over the life of the investment using the effective interest method and recognized on the accrual basis. Fees received in connection with loan commitments are deferred until the loan is funded and are then recognized over the term of the loan as an adjustment to yield. Anticipated exit fees, whose collection is expected, are also recognized over the term of the loan as an adjustment to yield. Fees on commitments that expire unused are recognized at expiration.

Income recognition is generally suspended for preferred equity investments at the earlier of the date at which payments become 90 days past due or when, in the opinion of management, a full recovery of interest income and principal becomes doubtful.  Interest

11

Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

income recognition is resumed when the loan becomes contractually current and performance is demonstrated to be resumed. Interest is recorded as income on impaired loans only to the extent cash is received. Several of the preferred equity investments provide for accrual of interest at specified rates, which differ from current payment terms. Interest is recognized on such loans at the accrual rate subject to management’s determination that accrued interest and outstanding principal are ultimately collectible, based on the underlying collateral and operations of the borrower. If management cannot make this determination, interest income above the current pay rate is recognized only upon actual receipt.

If we purchase a preferred equity investment at a discount, intend to hold it until maturity and expect to recover the full value of the investment, we accrete the discount into income as an adjustment to yield over the term of the investment. If we purchase a preferred equity investment at a discount with the intention of foreclosing on the collateral, we do not accrete the discount.

Income Taxes

No provision has been made for income taxes in the accompanying consolidated financial statements since such taxes, if any, are the responsibility of the individual partners.

Reserve for Possible Credit Losses

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

Where impairment is indicated on an investment that is held to maturity, a valuation allowance is measured based upon the excess of the recorded investment amount over the net fair value of the collateral.  Any deficiency between the carrying amount of an asset and the calculated value of the collateral is charged to expense.  The write-off of the reserve balance is called a charge-off.  We recorded no loan loss reserves during the three or six months ended June 30, 2013 and 2012, respectively. During the three and six months ended June 30, 2012, we recorded zero and $0.5 million, respectively, in recoveries in connection with the sale of one of our debt investments. This is included in loan loss reserves, net of recoveries in the accompanying consolidated statements of income.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Fair Value Measurements

Fair value is a market-based measurement, not an entity-specific measurement, and should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, FASB guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).

The estimated fair values of tangible and intangible assets and liabilities recorded in connection with business combinations are based on Level 3 inputs. We estimate fair values based on cash flow projections utilizing appropriate discount and/or capitalization rates and available market information.

We determine impairment in real estate investments and preferred equity investments, including intangibles, utilizing cash flow projections that apply estimated revenue and expense growth rates, discount rates and capitalization rates, which are classified as Level 3 inputs. We determined the valuation allowance for loan losses based on Level 3 inputs. See Note 5, “Preferred Equity and Other Investment.”

We use the following methods and assumptions in estimating fair value disclosures for financial instruments.

·Cash and cash equivalents, restricted cash, accounts receivable, and accounts payable and accrued expenses: The carrying amount of cash and cash equivalents, restricted cash, accounts receivable, and accounts payable and accrued expenses reported in our consolidated balance sheets approximates fair value due to the short-term nature of these instruments.

12

Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

·Preferred equity investments:  The fair value of preferred equity investments is estimated by discounting the future cash flows using current interest rates at which similar loans with the same maturities would be made to borrowers with similar credit ratings. See “Reserve for Possible Credit Losses” below regarding valuation allowances for loan losses.

·Derivative instruments: The fair value of derivative instruments is based on current market data received from financial sources that trade such instruments and are based on prevailing market data and derived from third party proprietary models based on well recognized financial principles and reasonable estimates about relevant future market conditions.

·Mortgage note and other loans payable and other debt: The fair value of borrowings is estimated by discounting the future cash flows using current interest rates at which similar borrowings could be made by us.

The methodologies used for measuring fair value have been categorized into three broad levels as follows:

Level 1 — Quoted prices in active markets for identical instruments.

Level 2 — Valuations based principally on other observable market parameters, including

·Quoted prices in active markets for similar instruments,

·Quoted prices in less active or inactive markets for identical or similar instruments,

·Other observable inputs (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates), and

·Market corroborated inputs (derived principally from or corroborated by observable market data).

Level 3 — Valuations based significantly on unobservable inputs.

·Valuations based on third-party indications (broker quotes or counterparty quotes) which were, in turn, based significantly on unobservable inputs or were otherwise not supportable as Level 2 valuations.

·Valuations based on internal models with significant unobservable inputs.

These levels form a hierarchy. We follow this hierarchy for our assets and liabilities measured at fair value on a recurring and nonrecurring basis. The classifications are based on the lowest level of input that is significant to the fair value measurement.

Concentrations of Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash investments, preferred equity investments and accounts receivable.  We place our cash investments in excess of insured amounts with high quality financial institutions. The collateral securing our preferred equity investments is located in the New York Metropolitan area. See Note 5, “Preferred Equity and Other Investments.” We perform ongoing credit evaluations of our tenants and require most tenants to provide security deposits or letters of credit.  Though these security deposits and letters of credit are insufficient to meet the total value of a tenant’s lease obligation, they are a measure of good faith and a source of funds to offset the economic costs associated with lost rent and the costs associated with re-tenanting the space.  Although the properties in our real estate portfolio are primarily located in Manhattan, we also have Suburban properties located in Westchester County and Connecticut.  The tenants located in our buildings operate in various industries.  Other than two tenants who account for approximately 5.0% and 3.2% of our annualized cash rent, no other tenant in our portfolio accounted for more than 3.0% of our annualized cash rent at June 30, 2013.  Approximately 18%, 10%, 10%, 9% and 9% of our annualized cash rent for the three months ended June 30, 2013 was attributable to 1185 Avenue of the Americas, 750 Third Avenue, 919 Third Avenue, 810 Seventh Avenue and 1350 Avenue of the Americas, respectively.

Reclassification

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

Accounting Standards Updates

In February 2013, the FASB issued guidance on the presentation and disclosure of reclassification adjustments out of accumulated other comprehensive income, or AOCI. The standard requires an entity to present information about significant items reclassified out of AOCI by component either on the face of the statement where net income is presented or as a separate disclosure in the notes to financial statements. The guidance became effective for calendar year-end public companies beginning in the first quarter of 2013 and its adoption did not have a material impact on our consolidated financial statements.

13

Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

3.Property Acquisitions

In September 2012, we acquired the aggregate 267,000 square foot office buildings located at 635 and 641 Sixth Avenue for $173.0 million.

In June 2012, we acquired a 215,000 square foot office building located at 304 Park Avenue South for $135.0 million. The property was acquired with approximately $102.0 million in cash and $33.0 million in units of limited partnership interest of the Operating Partnership.

The following summarizes our allocation of the purchase price of the assets acquired and liabilities assumed upon the closing of these 2012 acquisitions (amounts in thousands):

	635-641 Sixth Avenue		304 Park Avenue South
Land	$	69,848	$	54,189
Building	104,474		75,619
Above market lease value	—		2,824
Acquired in-place leases	7,727		8,265
Assets acquired	182,049		140,897
Below market lease value	9,049		5,897
Liabilities assumed	9,049		5,897
Purchase price allocation	$	173,000	$	135,000
Net consideration funded by us at closing	$	173,000	$	135,000
Equity and/or debt investment held	$	—	$	—
Debt assumed	$	—	$	—

4.Assets Held for Sale

In June 2013, we entered into an agreement to sell the property located at 333 West 34th, New York, New York for $220.3 million. This transaction closed on August 9, 2013.

Discontinued operations included the results of operations of real estate assets under contract prior to June 30, 2013. This included 333 West 34th, which was held for sale at June 30, 2013.

The following table summarizes income from discontinued operations for the three and six months ended June 30, 2013 and 2012, respectively (in thousands).

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Revenues
Rental revenue	$	4,569	$	3,402	$	8,250	$	6,936
Escalation and reimbursement revenues	139		567		566		1,050
Total revenues	4,708		3,969		8,816		7,986
Operating expenses	1,247		1,223		2,473		2,413
Real estate taxes	235		239		470		473
Depreciation and amortization	1,506		1,471		2,987		2,903
Total expenses	2,988		2,933		5,930		5,789
Net income from discontinued operations	$	1,720	$	1,036	$	2,886	$	2,197

14

Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

5.Preferred Equity and Other Investment

As of June 30, 2013 and December 31, 2012, we held the following preferred equity investments, with an aggregate weighted average current yield of approximately 10.2% at June 30, 2013 (in thousands):

Type	June 30, 2013 SeniorFinancing		June 30, 2013 Carrying Value, Net of Discounts and Deferred Origination Fees		December 31, 2012 Carrying Value, Net of Discounts and Deferred Origination Fees		InitialMandatory Redemption
Preferred equity	$	70,000	$	9,934	$	9,927	October 2014
Preferred equity(1)(2)	525,000		105,360		99,768		July 2015
Preferred equity(1)(3)	55,986		22,213		18,925		April 2016
Preferred equity(1)	926,260		213,794		209,959		July 2016
	$	1,577,246	$	351,301	$	338,579

(1)	The difference between the pay and accrual rates is included as an addition to the principal balance outstanding.
(2)	In June 2013, the redemption date was extended from July 2014 to July 2015.
(3)	As of June 30, 2013, we are committed to fund an additional $3.6 million on this loan.

At June 30, 2013 and December 31, 2012, all preferred equity investments were performing in accordance with the terms of the loan agreements.

The Other Investment, which was acquired in January 2013 and is accounted for under the equity method of accounting, relates to our 40.0% interest in a joint venture that holds a preferred equity interest in an entity that owns a retail property located in Manhattan. The preferred equity investment bears interest at a rate of 8.75% per annum and matures in June 2016. As of June 30, 2013, our investment balance was $20.4 million.

6.Mortgage Note and Other Loans Payable

The mortgage note and other loans payable collateralized by the property listed below and assignment of leases and investment at June 30, 2013 and December 31, 2012, respectively, were as follows (amounts in thousands):

Property	Interest Rate(1)		Maturity Date	June 30,  2013		December 31, 2012
609 Partners, LLC(2)	5.00	%	7/2014	$	23	$	23
Other loan payable(3)	8.00	%	9/2019	50,000		50,000
919 Third Avenue(4)	5.12	%	6/2023	500,000		500,000
				$	550,023	$	550,023

(1)	Effective weighted average interest rate for the three months ended June 30, 2013.
(2)	As part of an acquisition, the Operating Partnership issued 63.9 million units of its 5.0% Series E Preferred Units, or the Series E Units, with a liquidation of $1.00 per unit. As of June 30, 2013, approximately 63.8 million Series E Units had been redeemed.
(3)	This loan is secured by a portion of a preferred equity investment.
(4)	We own a 51% controlling interest in the joint venture that is the borrower on this loan. This loan is non-recourse to us.

At June 30, 2013, the gross book value of the property and investment collateralizing the mortgage note and other loans payable was approximately $1.5 billion.

15

Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

7.Corporate Indebtedness

2012 Credit Facility

In November 2012, we entered into a $1.6 billion credit facility, or the 2012 credit facility, which refinanced, extended and upsized the previous 2011 revolving credit facility. The 2012 credit facility consists of a $1.2 billion revolving credit facility, or the revolving credit facility, and a $400.0 million term loan, or the term loan facility.  The revolving credit facility matures in March 2017 and includes two six-month extension options, subject to certain conditions and the payment of an extension fee of 10 basis points for each such extension. We also have an option, subject to customary conditions, without the consent of existing lenders, to increase the capacity under the revolving credit facility to $1.5 billion at any time prior to the maturity date for the revolving credit facility, by obtaining additional commitments from our current lenders and other financial institutions. The term loan facility matures on March 30, 2018.

The 2012 credit facility bears interest at a spread over LIBOR ranging from (i) 100 basis points to 175 basis points for loans under the revolving credit facility and (ii) 115 basis points to 200 basis points for loans under the term loan facility, in each case based on the credit rating assigned to our senior unsecured long-term indebtedness. At June 30, 2013, the applicable spread was 145 basis points for revolving credit facility and 165 basis points for the term loan facility. We are required to pay quarterly in arrears a 15 to 35 basis point fee on the unused balance of the commitments under the revolving credit facility. As of June 30, 2013, the facility fee was 30 basis points. At June 30, 2013, we had approximately $91.6 million of outstanding letters of credit, $40.0 million borrowings under the revolving credit facility and $400.0 million outstanding under the term loan facility, with undrawn capacity of $1.2 billion under the 2012 credit facility.

We, SL Green and the Operating Partnership are all borrowers jointly and severally obligated under the 2012 credit facility.  No other subsidiary of ours is an obligor under the 2012 credit facility.

The 2012 credit facility includes certain restrictions and covenants (see Restrictive Covenants below).

2011 Revolving Credit Facility

The 2012 credit facility replaced our $1.5 billion revolving credit facility, or the 2011 revolving credit facility, which was terminated concurrently with the entering into the 2012 credit facility. The 2011 revolving credit facility bore interest at a spread over LIBOR ranging from 100 basis points to 185 basis points, based on the credit rating assigned to our senior unsecured long term indebtedness, and required us to pay quarterly in arrears a 17.5 to 45 basis point facility fee on the total commitments under the 2011 revolving credit facility. The 2011 revolving credit facility included certain restrictions and covenants and, as of the time of the termination of the 2011 revolving credit facility and as of November 2012, we were in compliance with all such restrictions and covenants.

Senior Unsecured Notes

The following table sets forth our senior unsecured notes and other related disclosures as of June 30, 2013 and December 31, 2012, respectively, by scheduled maturity date (amounts in thousands):

Issuance	June 30, 2013 Unpaid Principal Balance		June 30, 2013 Accreted Balance		December 31, 2012 Accreted Balance		Coupon Rate(1)		Effective Rate		Term (in Years)	Maturity
August 13, 2004(2)	$	75,898	$	75,898	$	75,898	5.88	%	5.88	%	10	August 15, 2014
March 31, 2006(2)	255,308		255,185		255,165		6.00	%	6.00	%	10	March 31, 2016
August 5, 2011(3)	250,000		249,651		249,620		5.00	%	5.00	%	7	August 15, 2018
March 16, 2010(3)	250,000		250,000		250,000		7.75	%	7.75	%	10	March 15, 2020
November 15, 2012(3)	200,000		200,000		200,000		4.50	%	4.50	%	10	December 1, 2022
June 27, 2005(4)	7		7		7		4.00	%	4.00	%	20	June 15, 2025
	$	1,031,213	$	1,030,741	$	1,030,690

(1)	Interest on the senior unsecured notes is payable semi annually with principal and unpaid interest due on the scheduled maturity dates.
(2)	On December 27, 2012, we repurchased $42.4 million of aggregate principal amount of these notes, consisting of $22.7 million of the 5.875% Notes and $19.7 million of the 6.0% Notes, for a total consideration of $46.4 million and realized a net loss on early extinguishment of debt of approximately $3.8 million.
(3)	We, SL Green and the Operating Partnership are co-obligors.
(4)	Exchangeable senior debentures which are currently callable at par. In addition, the debentures can be put to us, at the option of the holder at par plus accrued and unpaid interest, on June 15, 2015 and 2020 and upon the occurrence of certain change of control transactions. As a result of the Merger, the adjusted exchange rate for the debentures is 7.7461 shares of SL Green’s common stock per $1,000 of principal amount of debentures and the adjusted reference dividend for the debentures is $1.3491. During the year ended December 31, 2012, we repurchased $650,000 of these bonds at par.

16

Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

ROP also provides a guaranty of the Operating Partnership’s obligations under its 3.00% Exchangeable Senior Notes due 2017.

Restrictive Covenants

The terms of the 2012 credit facility and certain of our senior unsecured notes include certain restrictions and covenants which may limit, among other things, SL Green’s ability to pay dividends, make certain types of investments, incur additional indebtedness, incur liens and enter into negative pledge agreements and dispose of assets, and which require compliance with financial ratios relating to the minimum amount of tangible net worth, a maximum ratio of total indebtedness to total asset value, a minimum ratio of EBITDA to fixed charges, a maximum ratio of secured indebtedness to total asset value and a maximum ratio of unsecured indebtedness to unencumbered asset value.  The dividend restriction referred to above provides that SL Green will not during any time when a default is continuing, make distributions with respect to its common stock or other equity interests, except to enable SL Green to continue to qualify as a REIT for Federal income tax purposes. As of June 30, 2013 and December 31, 2012, we were in compliance with all such covenants.

Principal Maturities

Combined aggregate principal maturities of mortgage note and other loans payable, revolving credit facility and term loan and senior unsecured notes as of June 30, 2013, including as-of-right extension options, were as follows (in thousands):

	Scheduled Amortization		Principal Repayments		Revolving Credit Facility		Term Loan and Senior Unsecured Notes		Total
2013	$	—	$	—	$	—	$	—	$	—
2014	—		23		—		75,898		75,921
2015	—		—		—		7		7
2016	4,116		—		—		255,185		259,301
2017	7,056		—		—		—		7,056
Thereafter	38,220		500,608		40,000		1,099,651		1,678,479
	$	49,392	$	500,631	$	40,000	$	1,430,741	$	2,020,764

Consolidated interest expense, excluding capitalized interest, was comprised of the following (in thousands):

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2013			2012			2013			2012
				As Adjusted						As Adjusted
Interest expense	$	27,597		$	26,601		$	54,339		$	54,510
Interest income	(13		)	(15		)	(26		)	(30		)
Interest expense, net	$	27,584		$	26,586		$	54,313		$	54,480
Interest capitalized	$	—		$	—		$	—		$	—

8.Fair Value of Financial Instruments

The following disclosures of estimated fair value were determined by management using available market information and appropriate valuation methodologies, as discussed in Note 2, “Significant Accounting Policies.”  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.

Cash and cash equivalents, restricted cash, accounts receivable and accounts payable balances reasonably approximate their fair values due to the short maturities of these items. Mortgage note and other loans payable and the senior unsecured notes had an estimated fair value based on discounted cash flow models, based on Level 3 inputs, of approximately $1.7 billion, compared to the book value of the related fixed rate debt of approximately $1.6 billion at June 30, 2013.  Our floating rate debt, inclusive of our 2012 credit facility, but excluding $30.0 million of which was swapped, had an estimated fair value based on discounted cash flow models, based on Level 3 inputs, of approximately $418.5 million, compared to the book value of the related floating rate debt of approximately $410.0

17

Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

million at June 30, 2013.  Our preferred equity investments had an estimated fair value ranging between $333.7 million and $368.9 million, compared to the book value of related preferred equity investments of approximately $351.3 million at June 30, 2013 based on Level 3 inputs.

Disclosure about fair value of financial instruments is based on pertinent information available to us as of June 30, 2013.  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.

9.Partners’ Capital

Since consummation of the Merger on January 25, 2007, the Operating Partnership has owned all the economic interests in ROP either by direct ownership or by indirect ownership through our general partner, which is its wholly-owned subsidiary.

Intercompany transactions between SL Green and ROP are generally recorded as contributions and distributions.

10.Financial Instruments: Derivatives and Hedging

We recognize all derivatives on the balance sheet at fair value.  Derivatives that are not hedges are adjusted to fair value through earnings.  If a derivative is a hedge, depending on the nature of the hedge, changes in the fair value of the derivative will either be offset against the change in fair value of the hedged asset, liability, or firm commitment through earnings, or recognized in other comprehensive income until the hedged item is recognized in earnings.  The ineffective portion of a derivative’s change in fair value will be immediately recognized in earnings.  Reported net income and capital may increase or decrease prospectively, depending on future levels of interest rates and other variables affecting the fair values of derivative instruments and hedged items, but will have no effect on cash flows.

Accumulated other comprehensive loss at June 30, 2013 consists of approximately $4.3 million from the settlement of hedges, which are being amortized over the remaining term of the related senior unsecured notes. Currently, all of our designated derivative instruments are effective hedging instruments.

Over time, the realized and unrealized gains and losses held in accumulated other comprehensive loss will be reclassified into earnings as an adjustment to interest expense in the same periods in which the hedged interest payments affect earnings. We estimate that approximately $0.9 million of the current balance held in accumulated other comprehensive loss will be reclassified into interest expense within the next 12 months.

The following table presents the effect of our derivative financial instruments on the consolidated statements of comprehensive income for the three months ended June 30, 2013 and 2012, respectively (in thousands):

		Amount of Loss Recognized in Other Comprehensive Loss (Effective Portion) For the Three Months Ended June 30,						Amount of (Gain) or Loss Reclassified from Accumulated Other Comprehensive Loss into Interest Expense (Effective Portion) For the Three Months Ended June 30,					Amount of Loss Recognized in Interest Expense (Ineffective Portion) For the Three Months Ended June 30,
Designation\Cash Flow	Derivative	2013			2012			2013			2012		2013		2012
Qualifying	Interest Rate Swaps/Caps	$	(231	)	$	(434	)	$	(230	)	$	245	$	—	$	(1	)
Non-qualifying	Interest Rate Caps	—			—			—			—		—		—

18

Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

The following table presents the effect of our derivative financial instruments on the consolidated statements of income for the six months ended June 30, 2013 and 2012, respectively (in thousands):

		Amount of Loss Recognized in Other Comprehensive Loss (Effective Portion) For the Six Months Ended						Amount of (Gain) or Loss Reclassified from Accumulated Other Comprehensive Loss into Interest Expense (Effective Portion) For the Six Months Ended					Amount of Loss Recognized in Interest Expense (Ineffective Portion) For the Six Months Ended
Designation\Cash Flow	Derivative	June 30, 2013			June 30, 2012			June 30,2013			June 30, 2012		June 30, 2013		June 30, 2012
Qualifying	Interest Rate Swaps/Caps	$	(193	)	$	(538	)	$	(477	)	$	489	$	—	$	(1	)
Non-qualifying	Interest Rate Caps/Currency Hedges	—			—			—			—		—		—

11.Related Party Transactions

Cleaning/ Security/ Messenger and Restoration Services

Through Alliance Building Services, or Alliance, First Quality Maintenance, L.P., or First Quality, provides cleaning, extermination and related services, Classic Security LLC provides security services, Bright Star Couriers LLC provides messenger services, and Onyx Restoration Works provides restoration services with respect to certain properties owned by us.  Alliance is partially owned by Gary Green, a son of Stephen L. Green, the chairman of SL Green’s board of directors.  In addition, First Quality has the non-exclusive opportunity to provide cleaning and related services to individual tenants at our properties on a basis separately negotiated with any tenant seeking such additional services.  An affiliate of ours has entered into an arrangement with Alliance whereby it will receive a profit participation above a certain threshold for services provided by Alliance to certain tenants at certain buildings above the base services specified in their lease agreements.  Alliance paid the affiliate approximately $0.8 million, $1.6 million, $0.7 million and $1.4 million for the three and six months ended June 30, 2013 and 2012, respectively.  We paid Alliance approximately $1.3 million, $2.5 million, $1.4 million and $2.4 million for the three and six months ended June 30, 2013 and 2012, respectively, for these services (excluding services provided directly to tenants).

Allocated Expenses from SL Green

Property operating expenses include an allocation of salary and other operating costs from SL Green based on square footage of the related properties.  Such amount was approximately $1.6 million, $3.5 million, $1.5 million and $3.2 million for the three and six months ended June 30, 2013 and 2012, respectively.

Insurance

We obtained insurance coverage through an insurance program administered by SL Green.  In connection with this program we incurred insurance expense of approximately $1.3 million, $2.5 million, $1.2 million and $2.3 million for the three and six months ended June 30, 2013 and 2012, respectively.

12.Commitments and Contingencies

We are not presently involved in any material litigation nor, to our knowledge, is any material litigation threatened against us or our properties, other than routine litigation arising in the ordinary course of business.  Management believes the costs, if any, incurred by us related to this litigation will not materially affect our financial position, operating results or liquidity.

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Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

The following is a schedule of future minimum lease payments under capital lease and non-cancellable operating leases with initial terms in excess of one year as of June 30, 2013 (in thousands):

	Capital lease			Non-cancellable operating leases
2013 (6 months)	$	1,073		$	7,563
2014	2,147			15,127
2015	2,218			15,282
2016	2,361			15,592
2017	2,361			15,592
Thereafter	299,303			932,123
Total minimum lease payments	309,463			$	1,001,279
Less amount representing interest	(282,500		)
Present value of net minimum lease payments	$	26,963

13.Environmental Matters

Our management believes that the properties are in compliance in all material respects with applicable Federal, state and local ordinances and regulations regarding environmental issues.  Management is not aware of any environmental liability that it believes would have a materially adverse impact on our financial position, results of operations or cash flows.  Management is unaware of any instances in which it would incur significant environmental cost if any of our properties were sold.

14.Segment Information

We are engaged in acquiring, owning, managing and leasing commercial properties in Manhattan, Westchester County and Connecticut and have two reportable segments, real estate and preferred equity and other investments.  We evaluate real estate performance and allocate resources based on earnings contribution to income from continuing operations.

Our real estate portfolio is primarily located in the geographical markets of Manhattan, Westchester County and Connecticut.  The primary sources of revenue are generated from tenant rents and escalations and reimbursement revenue.  Real estate property operating expenses consist primarily of security, maintenance, utility costs, real estate taxes and ground rent expense (at certain applicable properties). See Note 5, “Preferred Equity and Other Investment,” for additional details on our preferred equity and other investment.

Selected results of operations for the three and six months ended June 30, 2013 and 2012 and selected asset information as of June 30, 2013 and December 31, 2012, regarding our operating segments are as follows (in thousands):

	Real Estate Segment		Preferred Equity and Other Investment Segment		Total Company
Total revenues, including equity in net income from unconsolidated joint venture
Three months ended:
June 30, 2013	$	128,729	$	10,212	$	138,941
June 30, 2012, As Adjusted	123,507		—		123,507
Six months ended:
June 30, 2013	$	258,505	$	20,043	$	278,548
June 30, 2012, As Adjusted	246,322		—		246,322
Income from continuing operations:
Three months ended:
June 30, 2013	$	11,691	$	8,372	$	20,063
June 30, 2012, As Adjusted	16,419		—		16,419
Six months ended:
June 30, 2013	$	20,027	$	16,454	$	36,481
June 30, 2012, As Adjusted	23,653		469		24,122
Total assets:
As of:
June 30, 2013	$	5,014,875	$	372,676	$	5,387,551
December 31, 2012	5,057,563		338,693		5,396,256

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Reckson Operating Partnership, L.P.

Notes to Consolidated Financial Statements

June 30, 2013

(Unaudited)

Income from continuing operations represents total revenues less total expenses for the real estate segment and total investment income and equity in net income from unconsolidated joint venture less allocated interest expense and provision for loan losses for the preferred equity and other investment segment.  Interest costs for the preferred equity and other investment segment are imputed assuming 100% leverage at 2012 credit facility borrowing cost. We also allocate loan loss reserves, net of recoveries to the preferred equity and other investment. We do not allocate marketing, general and administrative expenses and transaction related costs to the preferred equity and other investment segment, since we base performance on the individual segments prior to allocating marketing, general and administrative expenses.  All other expenses, except interest, relate entirely to the real estate assets.  There were no transactions between the above two segments.

The table below reconciles income from continuing operations to net income attributable to common unitholders for the three and six months ended June 30, 2013 and 2012 (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
				As Adjusted						As Adjusted
Income from continuing operations	$	20,063		$	16,419		$	36,481		$	24,122
Net income from discontinued operations	1,720			1,036			2,886			2,197
Net income	21,783			17,455			39,367			26,319
Net income attributable to noncontrolling interests in other partnerships	(1,599		)	(2,067		)	(3,112		)	(3,440		)
Net income attributable to ROP common unitholder	$	20,184		$	15,388		$	36,255		$	22,879

15.Supplemental Disclosure of Non-Cash Investing and Financing Activities

The following table provides information on non-cash investing and financing activities for the six months ended June 30, 2013 and 2012, respectively (in thousands):

	Six Months Ended June 30,
	2013		2012
			As Adjusted
Tenant improvements and capital expenditures payable	$	2,667	$	4,559
Deferred leasing payable	368		344
Contributions from common unitholder	—		33,090
Redemption of Series E units	—		31,698
Capital leased asset	10,657		—
Transfer to net assets held for sale	194,097		—

16.Subsequent Events

The sale of 333 West 34th closed on August 9, 2013.  See Note 4, “Assets Held for Sale.”

In August 2013, we entered into a contract to acquire a mixed-use residential and commercial property located at 315 West 33rd Street, New York, New York for $386.0 million.  This transaction is expected to be completed in 2013, subject to customary closing conditions.

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ITEM 2.   Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

Reckson Operating Partnership, L.P., or ROP, commenced operations on June 2, 1995.  The sole general partner of ROP is a wholly-owned subsidiary of SL Green Operating Partnership, L.P., or the Operating Partnership.  The sole limited partner of ROP is the Operating Partnership. SL Green Realty Corp., or SL Green, is the general partner of the Operating Partnership.

ROP is engaged in the acquisition, management, operation, leasing and financing of commercial real estate properties, principally office properties and also owns land for future development located in the New York City, Westchester County and Connecticut, which collectively is also known as the New York Metropolitan area.

On January 25, 2007, SL Green completed the acquisition of all of the outstanding shares of common stock of Reckson Associates Realty Corp., or RARC, the prior general partner of ROP. This transaction is referred to herein as the Merger.

In connection with the closing of our 2011 revolving credit facility and new 2012 credit facility in which we, along with SL Green and the Operating Partnership are borrowers, SL Green transferred five properties with total assets aggregating to $683.8 million at November 1, 2011 and transferred three additional properties, with total assets aggregating to $320.2 million at December 31, 2012, to ROP. Under the Business Combinations guidance, these transfers were determined to be transfers of businesses between the indirect parent company and its wholly-owned subsidiary. As such, the assets and liabilities were transferred at their carrying value. These transfers are required to be recorded as of the beginning of the current reporting period as though the assets and liabilities had been transferred at that date. The financial statements and financial information presented for all prior periods have been retrospectively adjusted to furnish comparative information.

On September 30, 2012, SL Green transferred $324.9 million of its preferred equity investments to ROP, one of which was subject to a secured $50.0 million loan. Under the Business Combinations guidance, these transfers were determined to be transfers of assets between the indirect parent company and its wholly-owned subsidiary. As such, the assets were transferred at their carrying value and accounted for prospectively from the date of transfer.

The following discussion related to our consolidated financial statements should be read in conjunction with the financial statements appearing in this Quarterly Report on Form 10-Q and in Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2012.

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

Location	Ownership	Number of Properties	Square Feet	Weighted Average Occupancy(1)
Manhattan	Consolidated properties	13	7,201,400	96.0	%
Suburban	Consolidated properties	17	2,785,500	78.1	%
		30	9,986,900	91.0	%

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

As of June 30, 2013, we also own a development property encompassing approximately 104,000 square feet as well as an inventory of development parcels that aggregated approximately 81 acres of land in four separate parcels on which we can, based on estimates at June 30, 2013, develop approximately 1.1 million square feet of office space and in which we had invested approximately $67.6 million. As of June 30, 2013, we also held preferred equity investments and an investment in an unconsolidated joint venture that holds a preferred equity interest in a retail property located in Manhattan with an aggregate book value of $371.7 million.

Critical Accounting Policies

Refer to our 2012 Annual Report on Form 10-K for a discussion of our critical accounting policies, which include investment in commercial real estate properties, investment in unconsolidated joint ventures, revenue recognition, allowance for doubtful accounts, reserve for possible credit losses and derivative instruments. There have been no changes to these policies during the six months ended June 30, 2013.

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Results of Operations

Comparison of the three months ended June 30, 2013 to the three months ended June 30, 2012

The following section compares the results of operations for the three months ended June 30, 2013 to the three months ended June 30, 2012 for the 30 consolidated properties owned by ROP.

Rental Revenues (in millions)	2013		2012		$ Change			% Change
			As Adjusted
Rental revenue, net	$	110.4	$	104.2	$	6.2		6.0	%
Escalation and reimbursement revenue	17.3		18.4		(1.1		)	(6.0	)
	$	127.7	$	122.6	$	5.1		4.2	%

Occupancy for our Manhattan portfolio was 96.0% at June 30, 2013 compared to 95.1% at June 30, 2012. Occupancy for our Suburban portfolio was 78.1% at June 30, 2013 compared to 81.1% at June 30, 2012. At June 30, 2013, approximately 4.2% and 0.8% of the space leased at our consolidated Manhattan and Suburban properties, respectively, is expected to expire during the remainder of 2013. Based on our estimates, the current market rents on these expected 2013 lease expirations at our consolidated Manhattan and Suburban properties would be higher by approximately 14.7% and 11.8% , respectively, than the existing in-place fully escalated rents while the current market rents on all our consolidated Manhattan and Suburban properties were approximately 9.7% and 4.0% higher, respectively, than the existing in-place fully escalated rents on leases that are scheduled to expire in all future years.

The decrease in escalation and reimbursement revenue was primarily due to lower electric reimbursements ($0.6 million) and operating expense escalations ($0.5 million).

The increase in rental and escalation revenues was also due to the acquisitions of 304 Park Avenue South in June 2012 and 641 Sixth Avenue in September 2012, which, in aggregate, contributed $2.2 million and $2.8 million of the total increase in rental and escalation and reimbursement revenues, respectively.

Non-Property Revenues (in millions)	2013		2012		$ Change			%Change
			As Adjusted
Equity in net income of unconsolidated joint venture	$	0.5	$	0.7	$	(0.2	)	(28.6	)%
Investment and other income	10.7		0.9		9.8			1,088.9
	$	11.2	$	1.6	$	9.6		600.0	%

The decrease in equity in net income of unconsolidated joint venture was due to the sale of Court Square in July 2012, which was partially offset by our new investment in an entity that holds a preferred equity investment.

The increase in investment and other income was primarily related to the additional income earned from the preferred equity investments transferred to us by SL Green in September 2012 ($9.7 million) and higher lease buy-out income ($0.3 million).

Property Operating Expenses (in millions)	2013		2012		$ Change			% Change
			As Adjusted
Operating expenses	$	28.6	$	26.4	$	2.2		8.3	%
Real estate taxes	22.5		22.5		—			—
Ground rent	3.4		3.6		(0.2		)	(5.6	)
	$	54.5	$	52.5	$	2.0		3.8	%

The increase in operating expenses was primarily a result of higher payroll costs ($0.5 million), professional fees ($0.4 million), repairs and maintenance ($0.3 million) and contract maintenance expenses ($0.4 million).

Also contributing to the overall increase was the acquisition of 304 Park Avenue South in June 2012 and 641 Sixth Avenue in September 2012, which had, in aggregate, $1.1 million in operating expenses during the three months ended June 30, 2013.

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Other Expenses (in millions)	2013		2012		$ Change			%Change
			As Adjusted
Interest expense, net of interest income	$	28.9	$	27.2	$	1.7		6.3	%
Depreciation and amortization expense	35.4		32.8		2.6			7.9
Transaction related costs	—		0.9		(0.9		)	(100.0	)
Marketing, general and administrative	0.1		0.1		—			—
	$	64.4	$	61.0	$	3.4		5.6	%

The increase in interest expense, net of interest income, was primarily a result of the issuance of a $200.0 million aggregate principal amount of 4.5% senior notes due 2022 in November 2012 and the assumption of the $50.0 million loan, which was transferred to us by SL Green in September 2012. This increase was partially offset by lower interest expense due to repayment of debt balances at 609 Fifth Avenue and 110 East 42nd Street in December 2012.

The increase in depreciation and amortization expense was attributable to the depreciation on 304 Park Avenue South ($1.1 million), which was acquired in June 2012, and 641 Sixth Avenue ($0.8 million), which was acquired in September 2012, as well as an increase in capital expenditures at the properties in the ROP portfolio.

Comparison of the six months ended June 30, 2013 to the six months ended June 30, 2012

The following section compares the results of operations for the six months ended June 30, 2013 to the six months ended June 30, 2012 for the 30 consolidated properties owned by ROP.

Rental Revenues (in millions)	2013		2012		$ Change			% Change
			As Adjusted
Rental revenue	$	220.1	$	207.4	$	12.7		6.1	%
Escalation and reimbursement revenue	35.4		37.1		(1.7		)	(4.6	)
	$	255.5	$	244.5	$	11.0		4.5	%

Occupancy for our Manhattan portfolio was 96.0% at June 30, 2013 compared to 95.1% at June 30, 2012. Occupancy for our Suburban portfolio was 78.1% at June 30, 2013 compared to 81.1% at June 30, 2012. At June 30, 2013, approximately 4.2% and 0.8% of the space leased at our consolidated Manhattan and Suburban properties, respectively, is expected to expire during the remainder of 2013. Based on our estimates, the current market rents on these expected 2013 lease expirations at our consolidated Manhattan and Suburban properties would be higher by approximately14.7% and 11.8%, respectively, than the existing in-place fully escalated rents while the current market rents on all our consolidated Manhattan and Suburban properties were approximately 9.7% and 4.0% higher, respectively, than the existing in-place fully escalated rents on leases that are scheduled to expire in all future years.

The decrease in escalation and reimbursement revenue was primarily due to lower electric reimbursements ($1.2 million) and operating expense escalations ($1.0 million) which were partially offset by higher real estate tax recoveries ($0.5 million).

The increase in rental and escalation revenues was also due to the acquisitions of 304 Park Avenue South in June 2012 and 641 Sixth Avenue in September 2012, which, in aggregate, contributed $5.2 million and $5.0 million of the total increase in rental and escalation and reimbursement revenues, respectively.

Non-Property Revenues (in millions)	2013		2012		$ Change		%Change
			As Adjusted
Equity in net income of unconsolidated joint venture	$	0.8	$	0.8	$	—	—	%
Investment and other income	22.2		1.9		20.3		1,068.4
	$	23.0	$	2.7	$	20.3	751.9	%

The increase in investment and other income was primarily related to the additional income earned from the preferred equity investment transferred to us by SL Green in September 2012 ($19.2 million) and higher lease buy-out income ($1.7 million), which was partially offset by lower fee and other income ($0.6 million).

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Property Operating Expenses (in millions)	2013		2012		$ Change		% Change
			As Adjusted
Operating expenses	$	58.8	$	54.4	$	4.4	8.1	%
Real estate taxes	45.9		44.4		1.5		3.4
Ground rent	9.2		7.3		1.9		26.0
	$	113.9	$	106.1	$	7.8	7.4	%

The increase in operating expenses was a result of higher payroll costs ($0.9 million), utility costs ($0.8 million), repairs and maintenance ($0.6 million), contract maintenance expenses ($0.6 million) and professional fees ($0.4 million). The increase in real estate taxes was primarily due to higher assessed values and higher tax rates while the increase in ground rent was due to the extension and modification of the terms of the ground lease at 673 First Avenue in September 2012, which contributed $1.7 million of the total increase in ground rent.

Also contributing to the overall increase was the acquisition of 304 Park Avenue South in June 2012 and 641 Sixth Avenue in September 2012, which had, in aggregate, $2.4 million in operating expenses and $1.4 million in real estate taxes during the six months ended June 30, 2013.

Other Expenses (in millions)	2013		2012			$ Change			%Change
			As Adjusted
Interest expense, net of interest income	$	56.9	$	56.5		$	0.4		0.7	%
Loan loss reserves, net of recoveries	—		(0.5		)	0.5			(100.0	)
Depreciation and amortization expense	71.1		65.5			5.6			8.5
Transaction related costs	—		0.9			(0.9		)	(100.0	)
Marketing, general and administrative expense	0.2		0.1			0.1			100.0
	$	128.2	$	122.5		$	5.7		4.7	%

The increase in interest expense, net of interest income, was primarily a result of the issuance of a $200.0 million aggregate principal amount of 4.5% senior notes due 2022 in November 2012 and the assumption of the $50.0 million loan, which was transferred to us by SL Green in Sept 2012. The increase was partially offset by lower interest expense due to repayment of debt balances at 609 Fifth Avenue and 110 East 42nd Street.

Loan loss and other investment reserves, net of recoveries is attributable to the partial recovery of reserves upon sale of debt investments in March 2012. No new loan loss reserves were recorded in either period.

The increase in depreciation and amortization expense was attributable to the depreciation on 304 Park Avenue South ($2.3 million), which was acquired in June 2012, and 641 Sixth Avenue ($0.9 million), which was acquired in September 2012, as well as an increase in capital expenditures at the properties in the ROP portfolio.

Liquidity and Capital Resources

On January 25, 2007, we were acquired by SL Green. See Item 2 “Management’s Discussion and Analysis—Liquidity and Capital Resources” in SL Green’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2013 for a complete discussion of additional sources of liquidity available to us due to our indirect ownership by SL Green.

We currently expect that our principal sources of funds to meet our short-term and long-term liquidity requirements for working capital and funds for acquisition and redevelopment of properties, tenant improvements, leasing costs, repurchases or repayments of outstanding indebtedness (which may include exchangeable debt) and for preferred equity investments will include:

(1)Cash flow from operations;

(2)Cash on hand;

(3)Borrowings under our 2012 credit facility;

(4)Other forms of secured or unsecured financing;

(5)Net proceeds from divestitures of properties and redemptions, participations and dispositions of preferred equity investments; and

(6)Proceeds from debt offerings by us.

Cash flow from operations is primarily dependent upon the occupancy level of our portfolio, the net effective rental rates achieved on our leases, the collectability of rent and operating escalations and recoveries from our tenants and the level of operating and other costs. Additionally, we believe that our preferred equity investment program will continue to serve as a source of capital.

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We believe that our sources of working capital, specifically our cash flow from operations and SL Green’s liquidity are adequate for us to meet our short-term and long-term liquidity requirements for the foreseeable future.

Cash Flows

The following summary discussion of our cash flows is based on our consolidated statements of cash flows in “Item 1. Financial Statements” and is not meant to be an all-inclusive discussion of the changes in our cash flows for the periods presented below.

Cash and cash equivalents were $27.2 million and $23.5 million at June 30, 2013 and 2012, respectively, representing an increase of $3.7 million. The increase was a result of the following changes in cash flows (in thousands):

	Six months ended June 30,
	2013			2012			Increase (Decrease)
	As Adjusted
Net cash provided by operating activities	$	70,083		$	67,099		$	2,984
Net cash used in investing activities	$	(47,459	)	$	(118,536	)	$	71,077
Net cash (used in) provided by financing activities	$	(29,462	)	$	48,281		$	(77,743	)

Our principal source of operating cash flow is related to the leasing and operating of the properties in our portfolio. Our properties provide a relatively consistent stream of cash flow that provides us with resources to pay operating expenses, service debt and fund quarterly dividend and distribution payment requirements. At June 30, 2013, our portfolio was 91.0% occupied. Our preferred equity investments also provide a steady stream of operating cash flow to us.

Cash is used in investing activities to fund acquisitions, redevelopment projects and recurring and nonrecurring capital expenditures. We selectively invest in existing buildings that meet our investment criteria.  During the six months ended June 30, 2013, when compared to the six months ended June 30, 2012, we used cash primarily for the following investing activities (in thousands):

Acquisition of real estate	$	102,910
Capital expenditures and capitalized interest	(1,842		)
Distributions from unconsolidated joint ventures	(152		)
Preferred equity and other investment	670
Restricted cash — capital improvements	(30,509		)
Decrease in net cash used in investments activities	$	71,077

Funds spent on capital expenditures, which comprise building and tenant improvements, increased from $22.9 million for the six months ended June 30, 2012 to $24.7 million for the six months ended June 30, 2013. The increased capital expenditures relate primarily to costs incurred in connection with redevelopment of properties and the build-out of space for tenants resulting from new leasing activity.

We generally fund our investment activity through property-level financing, our 2012 credit facility, senior unsecured notes and asset sales.  During the six months ended June 30, 2013, when compared to the six months ended June 30, 2012, we used cash for the following financing activities (in thousands):

Repayments under our debt obligations	$	(98,339	)
Proceeds from debt obligations	339,890
Contributions from common unitholder	(375,419		)
Distributions to common unitholder and noncontrolling interests	55,947
Deferred loan costs and capital lease obligation	178
Increase in net cash used in financing activities	$	(77,743	)

Capitalization

Since consummation of the Merger on January 25, 2007, the Operating Partnership has owned all the economic interests in ROP either by direct ownership or by indirect ownership through 100% ownership by our general partner.

Contractual Obligations

Refer to our 2012 Annual Report on Form 10-K for a discussion of our contractual obligations. There have been no material changes, outside the ordinary course of business, to these contractual obligations during the six months ended June 30, 2013.

26

Corporate Indebtedness

2012 Credit Facility

In November 2012, we entered into a $1.6 billion credit facility, or the 2012 credit facility, which refinanced, extended and upsized the previous 2011 revolving credit facility. The 2012 credit facility consists of a $1.2 billion revolving credit facility, or the revolving credit facility, and a $400.0 million term loan, or the term loan facility.  The revolving credit facility matures in March 2017 and includes two six-month extension options, subject to certain conditions and the payment of an extension fee of 10 basis points for each such extension. We also have an option, subject to customary conditions, without the consent of existing lenders, to increase the capacity under the revolving credit facility to $1.5 billion at any time prior to the maturity date for the revolving credit facility, by obtaining additional commitments from our current lenders and other financial institutions. The term loan facility matures on March 30, 2018.

The 2012 credit facility bears interest at a spread over LIBOR ranging from (i) 100 basis points to 175 basis points for loans under the revolving credit facility and (ii) 115 basis points to 200 basis points for loans under the term loan facility, in each case based on the credit rating assigned to our senior unsecured long-term indebtedness. At June 30, 2013, the applicable spread was 145 basis points for revolving credit facility and 165 basis points for the term loan facility. We are required to pay quarterly in arrears a 15 to 35 basis point fee on the unused balance of the commitments under the revolving credit facility. As of June 30, 2013, the facility fee was 30 basis points. At June 30, 2013, we had approximately $91.6 million of outstanding letters of credit, $40.0 million borrowings under the revolving credit facility and $400.0 million outstanding under the term loan facility, with undrawn capacity of $1.2 billion under the 2012 credit facility.

We, SL Green and the Operating Partnership are all borrowers jointly and severally obligated under the 2012 credit facility.  No other subsidiary of ours is an obligor under the 2012 credit facility.

The 2012 credit facility includes certain restrictions and covenants (see Restrictive Covenants below).

2011 Revolving Credit Facility

The 2012 credit facility replaced our $1.5 billion revolving credit facility, or the 2011 revolving credit facility, which was terminated concurrently with the entering into the 2012 credit facility. The 2011 revolving credit facility bore interest at a spread over LIBOR ranging from 100 basis points to 185 basis points, based on the credit rating assigned to our senior unsecured long term indebtedness, and required us to pay quarterly in arrears a 17.5 to 45 basis point facility fee on the total commitments under the 2011 revolving credit facility. The 2011 revolving credit facility included certain restrictions and covenants and, as of the time of the termination of the 2011 revolving credit facility and as of November 2012, we were in compliance with all such restrictions and covenants.

Senior Unsecured Notes

The following table sets forth our senior unsecured notes and other related disclosures as of June 30, 2013 and December 31, 2012, respectively, by scheduled maturity date (amounts in thousands):

Issuance	June 30, 2013 Unpaid Principal Balance		June 30, 2013 Accreted Balance		December 31, 2012 Accreted Balance		Coupon Rate(1)		Effective Rate		Term (in Years)	Maturity
August 13, 2004(2)	$	75,898	$	75,898	$	75,898	5.88	%	5.88	%	10	August 15, 2014
March 31, 2006(2)	255,308		255,185		255,165		6.00	%	6.00	%	10	March 31, 2016
August 5, 2011(3)	250,000		249,651		249,620		5.00	%	5.00	%	7	August 15, 2018
March 16, 2010(3)	250,000		250,000		250,000		7.75	%	7.75	%	10	March 15, 2020
November 15, 2012(3)	200,000		200,000		200,000		4.50	%	4.50	%	10	December 1, 2022
June 27, 2005(4)	7		7		7		4.00	%	4.00	%	20	June 15, 2025
	$	1,031,213	$	1,030,741	$	1,030,690

(1)	Interest on the senior unsecured notes is payable semi-annually with principal and unpaid interest due on the scheduled maturity dates.
(2)	On December 27, 2012, we repurchased $42.4 million aggregate principal amount of these notes, consisting of $22.7 million of the 5.875% Notes and $19.7 million of the 6.0% Notes, for a total consideration of $46.4 million and realized a net loss on early extinguishment of debt of approximately $3.8 million.
(3)	We, SL Green and the Operating Partnership are co-obligors.
(4)	Exchangeable senior debentures which are currently callable at par. In addition, the debentures can be put to us, at the option of the holder at par plus accrued and unpaid interest, on June 15, 2015 and 2020 and upon the occurrence of certain change of control transactions. As a result of the Merger, the adjusted exchange rate for the debentures is 7.7461 shares of SL Green’s common stock per $1,000 of principal amount of debentures and the adjusted reference dividend for the debentures is $1.3491. During the year ended December 31, 2012, we repurchased $650,000 of these bonds at par.

ROP also provides a guaranty of the Operating Partnership’s obligations under its 3.00% Exchangeable Senior Notes due 2017.

27

Restrictive Covenants

The terms of the 2012 credit facility and certain of our senior unsecured notes include certain restrictions and covenants which may limit, among other things, SL Green’s ability to pay dividends, make certain types of investments, incur additional indebtedness, incur liens and enter into negative pledge agreements and dispose of assets, and which require compliance with financial ratios relating to the minimum amount of tangible net worth, a maximum ratio of total indebtedness to total asset value, a minimum ratio of EBITDA to fixed charges, a maximum ratio of secured indebtedness to total asset value and a maximum ratio of unsecured indebtedness to unencumbered asset value. The dividend restriction referred to above provides that SL Green will not during any time when a default is continuing, make distributions with respect to its common stock or other equity interests, except to enable SL Green to continue to qualify as a REIT for Federal income tax purposes. As of June 30, 2013 and December 31, 2012, we were in compliance with all such covenants.

Market Rate Risk

We are exposed to changes in interest rates primarily from our floating rate borrowing arrangements. We use interest rate derivative instruments to manage exposure to interest rate changes. A hypothetical 100 basis point increase in interest rates along the entire interest rate curve for 2013 would increase our annual interest cost by approximately $4.1 million.

We recognize most derivatives on the balance sheet at fair value. Derivatives that are not hedges must be adjusted to fair value through income. If a derivative is considered a hedge, depending on the nature of the hedge, changes in the fair value of the derivative will either be offset against the change in fair value of the hedged asset, liability, or firm commitment through earnings, or recognized in other comprehensive income until the hedged item is recognized in earnings. The ineffective portion of a derivative’s change in fair value is immediately recognized in earnings.

Approximately $1.6 billion of our long-term debt bears interest at fixed rates, and therefore the fair value of these instruments is affected by changes in the market interest rates. The interest rate on our variable rate debt as of June 30, 2013 was based on a spread of LIBOR plus 145 basis points to LIBOR plus 165 basis points.

Off-Balance Sheet Arrangements

We have a number of off-balance sheet investments, including our preferred equity investments.  These investments all have varying ownership structures.  Our off-balance sheet arrangements are discussed in Note 5, “Preferred Equity and Other Investment” in the accompanying consolidated financial statements.

Capital Expenditures

We estimate that for the six months ending December 31, 2013, we expect to incur approximately $64.2 million of capital expenditures, which are net of loan reserves, (including tenant improvements and leasing commissions) on consolidated properties.  We expect to fund these capital expenditures with operating cash flow and cash on hand. 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. We believe that we will have sufficient resources to satisfy our capital needs during the next 12-month period.  Thereafter, we expect our capital needs will be met through a combination of cash on hand, net cash provided by operations, borrowings, potential asset sales or additional debt issuances.

Related Party Transactions

Cleaning/ Security/ Messenger and Restoration Services

Through Alliance Building Services, or Alliance, First Quality Maintenance, L.P., or First Quality, provides cleaning, extermination and related services, Classic Security LLC provides security services, Bright Star Couriers LLC provides messenger services, and Onyx Restoration Works provides restoration services with respect to certain properties owned by us.  Alliance is partially owned by Gary Green, a son of Stephen L. Green, the chairman of SL Green’s board of directors.  In addition, First Quality has the non-exclusive opportunity to provide cleaning and related services to individual tenants at our properties on a basis separately negotiated with any tenant seeking such additional services.  An affiliate of ours has entered into an arrangement with Alliance whereby it will receive a profit participation above a certain threshold for services provided by Alliance to certain tenants at certain buildings above the base services specified in their lease agreements.  Alliance paid the affiliate approximately $0.8 million, $1.6 million, $0.7 million and $1.4 million for the three and six months ended June 30, 2013 and 2012, respectively.  We paid Alliance approximately $1.3 million, $2.5 million, $1.4 million and $2.4 million for the three and six months ended June 30, 2013 and 2012, respectively, for these services (excluding services provided directly to tenants).

Allocated Expenses from SL Green

Property operating expenses include an allocation of salary and other operating costs from SL Green based on square footage of the related properties.  Such amount was approximately $1.6 million, $3.5 million, $1.5 million and $3.2 million for the three and six months ended June 30, 2013 and 2012, respectively.

28

Insurance

ROP gets insurance through a program administered by SL Green. SL Green maintains “all-risk” property and rental value coverage (including coverage regarding the perils of flood, earthquake and terrorism) within two property insurance portfolios and liability insurance. This includes the ROP assets. As of June 30, 2013, the first property portfolio maintains a blanket limit of $950.0 million per occurrence, including terrorism, for the majority of the New York City properties in our portfolio. The second portfolio maintains a limit of $700.0 million per occurrence, including terrorism, for some New York City properties and the majority of the Suburban properties.  Both policies expire on December 31, 2013. Each policy includes $100.0 million of flood coverage with a lower sublimit for locations in high hazard flood zones. SL Green maintains liability policies which cover all our properties and provide limits of $201.0 million per occurrence and in the aggregate per location.  The liability policies expire on October 31, 2013. Additional coverage may be purchased on a stand-alone basis for certain assets.

In October 2006, SL Green formed a wholly-owned taxable REIT subsidiary, Belmont Insurance Company, or Belmont, to act as a captive insurance company and be one of the elements of its overall insurance program. Belmont was formed in an effort to, among other reasons, stabilize to some extent the fluctuations of insurance market conditions. Belmont is licensed in New York to write Terrorism, NBCR (nuclear, biological, chemical, and radiological), General Liability, Environmental Liability, Flood and D&O coverage.

·Terrorism: Belmont acts as a direct property insurer with respect to a portion of our terrorism coverage for the New York City properties.  Belmont has a terrorism coverage limit of $850.0 million in a layer in excess of $100.0 million.  In addition, Belmont purchased reinsurance to reinsure the retained insurable risk not otherwise covered under Terrorism Risk Insurance Program Reauthorization and Extension Act of 2007, or TRIPRA, as detailed below.

·NBCR: Belmont has acted as a direct insurer of NBCR coverage and since December 31, 2011, has provided coverage up to $750.0 million on SL Green’s entire property portfolio for certified acts of terrorism above a program trigger of $100.0 million.  Belmont is responsible for a small deductible and 15% of a loss, with the remaining 85% covered by the Federal government.

·General Liability: For the period commencing October 31, 2010, Belmont insures a retention on the general liability insurance of $150,000 per occurrence and a $2.1 million annual aggregate stop loss limit. SL Green has secured excess insurance to protect against catastrophic liability losses above the $150,000 retention.  Prior policy years carried a higher per occurrence deductible and/or higher aggregate stop loss.  Belmont has retained a third party administrator to manage all claims within the retention and we anticipate that direct management of liability claims will improve loss experience and ultimately lower the cost of liability insurance in future years. In addition, SL Green has an umbrella liability policy of $200.0 million per occurrence and in the aggregate on a per location basis.

·Environmental Liability: Belmont insures a deductible of $975,000 per occurrence in excess of $25,000 on a $25.0 million per occurrence and $30.0 million aggregate environmental liability policy covering SL Green’s entire portfolio.

·Flood: For the period commencing December 31, 2012, Belmont insures a portion of the high hazard flood deductible on the New York City portfolio. Belmont insurance reduces the average deductible from $3.0 million to $1.0 million.

The Terrorism Risk Insurance Act, or TRIA, which was enacted in November 2002, was renewed on December 31, 2005 and again on December 31, 2007. Congress extended TRIA, now called TRIPRA (Terrorism Risk Insurance Program Reauthorization and Extension Act of 2007) until December 31, 2014. The law extends the federal Terrorism Insurance Program that requires insurance companies to offer terrorism coverage and provides for compensation for insured losses resulting from acts of certified terrorism, subject to the current program trigger of $100.0 million.  There is no assurance that TRIPRA will be extended. Our debt instruments, consisting of a non-recourse mortgage note secured by one of our properties, mezzanine loans, ground leases, our 2012 credit facility, senior unsecured notes and other corporate obligations, contain customary covenants requiring us to maintain insurance. Although we believe that we currently maintain sufficient insurance coverage to satisfy these obligations, there is no assurance that in the future we will be able to procure coverage at a reasonable cost.  In such instances, there can be no assurance that the lenders or ground lessors under these instruments will not take the position that a total or partial exclusion from “all-risk” insurance coverage for losses due to terrorist acts is a breach of these debt and ground lease instruments allowing the lenders or ground lessors to declare an event of default and accelerate repayment of debt or recapture of ground lease positions. In addition, if lenders prevail in asserting that we are required to maintain full coverage for these risks, it could result in substantially higher insurance premiums.

In connection with this insurance program administered by SL Green, we incurred insurance expense of approximately $1.3 million, $2.5 million, $1.2 million and $2.3 million for the three and six months ended June 30, 2013 and 2012, respectively.

29

Inflation

Substantially all of the office leases provide for separate real estate tax and operating expense escalations as well as operating expense recoveries based on increases in the Consumer Price Index or other measures such as porters’ wage.  In addition, many of the leases provide for fixed base rent increases.  We believe that inflationary increases may be at least partially offset by the contractual rent increases and expense escalations described above.

Accounting Standards Updates

The Accounting Standards Updates are discussed in Note 2, “Significant Accounting Policies—Accounting Standards Updates” in the accompanying consolidated financial statements.

30

Forward-Looking Information

This report includes certain statements that may be deemed to be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and are intended to be covered by the safe harbor provisions thereof.  All statements, other than statements of historical facts, included in this report that address activities, events or developments that we expect, believe or anticipate will or may occur in the future, including such matters as future capital expenditures, dividends and acquisitions (including the amount and nature thereof), development trends of the real estate industry and the Manhattan, Westchester County and Connecticut office markets, business strategies, expansion and growth of our operations and other similar matters, are forward-looking statements. These forward-looking statements are based on certain assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate.

Forward-looking statements are not guarantees of future performance and actual results or developments may differ materially, and we caution you not to place undue reliance on such statements.  Forward-looking statements are generally identifiable by the use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” “project,” “continue,” or the negative of these words, or other similar words or terms.

Forward-looking statements contained in this report are subject to a number of risks and uncertainties that may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by forward-looking statements made by us.  These risks and uncertainties include:

·the effect of general economic, business and financial conditions, and their effect on the New York metropolitan real estate market in particular;

·dependence upon certain geographic markets;

·risks of real estate acquisitions, dispositions and developments, including the cost of construction delays and cost overruns;

·risks relating to preferred equity investments;

·availability and creditworthiness of prospective tenants and borrowers;

·bankruptcy or insolvency of a major tenant or a significant number of smaller tenants;

·adverse changes in the real estate markets, including reduced demand for office space, increasing vacancy, and increasing availability of sublease space;

·availability of capital (debt and equity);

·unanticipated increases in financing and other costs, including a rise in interest rates;

·our ability to comply with financial covenants in our debt instruments;

·SL Green’s ability to maintain its status as a REIT;

·risks of investing through joint venture structures, including the fulfillment by our partners of their financial obligations;

·the continuing threat of terrorist attacks, in particular in the New York Metropolitan area and on our tenants;

·our ability to obtain adequate insurance coverage at a reasonable cost and the potential for losses in excess of our insurance coverage, including as a result of environmental contamination; and

·legislative, regulatory and/or safety requirements adversely affecting REITs and the real estate business, including costs of compliance with the Americans with Disabilities Act, the Fair Housing Act and other similar laws and regulations.

Other factors and risks to our business, many of which are beyond our control, are described in other sections of this report and in our other filings with the SEC.  We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of future events, new information or otherwise.

The risks included here are not exhaustive.  Other sections of this report may include additional factors that could adversely affect ROP’s business and financial performance.  In addition, sections of SL Green’s Annual Report on Form 10-K for the year ended December 31, 2012 contain additional factors that could adversely affect our business and financial performance.  Moreover, ROP operates in a very competitive and rapidly changing environment.  New risk factors emerge from time to time and it is not possible for management to predict all such risk factors, nor can it assess the impact of all such risk factors on ROP’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.  Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.

31

ITEM 3.  Quantitative and Qualitative Disclosure About Market Risk

For quantitative and qualitative disclosures about market risk, see Item 7A, “Quantitative and Qualitative Disclosures About Market Risk,” in our Annual Report on Form 10-K for the year ended December 31, 2012.  Our exposures to market risk have not changed materially since December 31, 2012.

ITEM 4.  Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including the principal executive officer and principal financial officer of our general partner, as appropriate, to allow timely decisions regarding required disclosure based closely on the definition of “disclosure controls and procedures” in Rule 13a-15(e) of the Exchange Act.  Notwithstanding the foregoing, a control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that it will detect or uncover failures within ROP to disclose material information otherwise required to be set forth in our periodic reports.  Also, we have an investment in an unconsolidated joint venture.  As we do not control this entity, our disclosure controls and procedures with respect to such entity are necessarily substantially more limited than those we maintain with respect to our consolidated subsidiaries.

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including the President and Treasurer of our general partner, of the effectiveness of the design and operation of our disclosure controls and procedures.  Based upon that evaluation as of the end of the period covered by this report, the President and Treasurer of our general partner concluded that our disclosure controls and procedures were effective to give reasonable assurance to the timely collection, evaluation and disclosure of information relating to ROP that would potentially be subject to disclosure under the Exchange Act and the rules and regulations promulgated thereunder.

Changes in Internal Control over Financial Reporting

There have been no significant changes in our internal control over financial reporting during the three months ended June 30, 2013, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

32

PART IIOTHER INFORMATION

ITEM 1.LEGAL PROCEEDINGS

As of June 30, 2013, we were not involved in any material litigation nor, to management’s knowledge, any material litigation threatened against us or our portfolio other than routine litigation arising in the ordinary course of business or litigation that is adequately covered by insurance.

ITEM 1A.RISK FACTORS

There have been no material changes to the risk factors disclosed in “Item 1A. Part I Risk Factors” in our 2012 Annual Report on Form 10-K. We encourage you to read “Item 1A. of Part I Risk Factors” in the 2012 Annual Report on Form 10-K for SL Green Realty Corp., our indirect parent company.

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

None

ITEM 3.DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4.MINE SAFETY DISCLOSURES

Not Applicable

ITEM 5.OTHER INFORMATION

None

33

ITEM 6.EXHIBITS

(a)Exhibits:

10.1	Amended and Restated Employment and Noncompetition Agreement, dated June 27, 2013, between SL Green and Andrew S. Levine, incorporated by reference to SL Green’s Form 8-K, dated June 27, 2013, filed with the SEC on July 3, 2013.*
31.1	Certification of Marc Holliday, President of Wyoming Acquisition GP LLC, the sole general partner of the Registrant, pursuant to Rule 13a-14(a) or Rule 15(d)-14(a), filed herewith.
31.2	Certification of James Mead, Treasurer of Wyoming Acquisition GP LLC, the sole general partner of the Registrant, pursuant to Rule 13a-14(a) or Rule 15(d)-14(a), filed herewith.
32.1	Certification of Marc Holliday, President of Wyoming Acquisition GP LLC, the sole general partner of the Registrant, pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code, filed herewith.
32.2	Certification of James Mead, Treasurer of Wyoming Acquisition GP LLC, the sole general partner of the Registrant, pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code, filed herewith.
101.1	The following financial statements from Reckson Operating Partnership, L.P.’s Quarterly Report on Form 10-Q for the six months ended June 30, 2013, formatted in XBRL: (i) Consolidated Balance Sheets (unaudited), (ii) Consolidated Statements of Income (unaudited), (iii) Consolidated Statements of Comprehensive Income (unaudited), (iv) Consolidated Statement of Capital (unaudited), (v) Consolidated Statements of Cash Flows (unaudited), and (vi) Notes to Consolidated Financial Statements (unaudited), detail tagged and filed herewith.

*Management contracts or compensatory plans or arrangements required to be filed as an exhibit to this Form 10-Q.

34

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.

		RECKSON OPERATING PARTNERSHIP, L.P.
		By: WYOMING ACQUISITION GP LLC
		By:	/s/ James Mead
			James Mead
			Treasurer
Date:	August 14, 2013

35

EX-31.1

Exhibit 31.1

CERTIFICATION

Reckson Operating Partnership, L. P.

Certification of Marc Holliday, Pursuant to Rule 13a — 14(a)/15(d) — 14(a)

I, Marc Holliday, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Reckson Operating Partnership, L.P. (the “Registrant”);

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4.The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5.The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the        Registrant’s internal control over financial reporting.

Date: August 14, 2013	/s/ Marc Holliday
	Marc Holliday
	President of Wyoming Acquisition GP LLC, the sole general partner of the Registrant

EX-31.2

Exhibit 31.2

CERTIFICATION

Reckson Operating Partnership, L. P

Certification of James Mead, Pursuant to Rule 13a — 14(a)/15(d) — 14(a)

I, James Mead, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Reckson Operating Partnership, L.P. (the “Registrant”);

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4.The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13(a)-15(f) and 15d-15(f)) for the Registrant and have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5.The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Date: August 14, 2013	/s/ James Mead
	James Mead
	Treasurer of Wyoming Acquisition GP LLC, the sole general partner of the Registrant

EX-32.1

Exhibit 32.1

RECKSON OPERATING PARTNERSHIP, L. P.

Certification of Marc Holliday, President of Wyoming Acquisition GP LLC, the sole general partner of the Registrant, pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code

I, Marc Holliday, President of Wyoming Acquisition GP LLC, the sole general partner of Reckson Operating Partnership, L. P. (the “Registrant”), certify pursuant to section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

1)The Quarterly Report on Form 10-Q of the Company for the quarterly period ended June 30, 2013 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated:  August 14, 2013	By:	/s/ Marc Holliday
		Marc Holliday
		President of Wyoming Acquisition GP LLC, the sole general partner of the Registrant

EX-32.2

Exhibit 32.2

RECKSON OPERATING PARTNERSHIP, L. P.

Certification of James Mead, Treasurer of Wyoming Acquisition GP LLC, the sole general partner of the Registrant, pursuant to Section 1350 of Chapter 63 of Title 18

of the United States Code

I, James Mead, Treasurer of Wyoming Acquisition GP LLC, the sole general partner of Reckson Operating Partnership, L. P. (the “Registrant”), certify pursuant to section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

1)The Quarterly Report on Form 10-Q of the Company for the quarterly period ended June 30, 2013 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: August 14, 2013
	By	/s/ James Mead
		James Mead
		Treasurer of Wyoming Acquisition GP LLC, the sole general partner of the Registrant

XML

Partners' Capital

6 Months Ended

Jun. 30, 2013

Partners' Capital

Partners' Capital

9. Partners’ Capital

Since consummation of the Merger on January 25, 2007, the Operating Partnership has owned all the economic interests in ROP either by direct ownership or by indirect ownership through our general partner, which is its wholly-owned subsidiary.

Intercompany transactions between SL Green and ROP are generally recorded as contributions and distributions.

XML

Subsequent Events ( Details) (Subsequent Event, Expected Completion, 315 West 33rd Street, New York, USD $) In Thousands, unless otherwise specified	Aug. 31, 2013
Subsequent Event | Expected Completion | 315 West 33rd Street, New York
Subsequent Events
Purchase consideration for mixed-use residential and commercial property	$ 386,000

XML

Consolidated Statements of Income (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Revenues
Rental revenue, net	$ 110,392	$ 104,168	$ 220,088	$ 207,363
Escalation and reimbursement	17,332	18,436	35,436	37,097
Investment income	9,731		19,196
Other income	1,005	903	2,981	1,862
Total revenues	138,460	123,507	277,701	246,322
Expenses
Operating expenses, including approximately $4,118 and $8,499 (2013) and $4,088 and $7,891 (2012) paid to related parties	28,571	26,369	58,769	54,448
Real estate taxes	22,488	22,453	45,853	44,367
Ground rent	3,430	3,645	9,202	7,290
Interest expense, net of interest income	27,584	26,586	54,313	54,480
Amortization of deferred finance costs	1,287	647	2,585	2,006
Loan loss reserves, net of recoveries				(472)
Transaction related costs		861	11	861
Depreciation and amortization	35,386	32,849	71,070	65,663
Marketing, general and administrative	122	127	188	132
Total expenses	118,868	113,537	241,991	228,775
Income from continuing operations before depreciable real estate reserve, net of recoveries, equity in net income from unconsolidated joint venture, and loss on early extinguishment of debt	19,592	9,970	35,710	17,547
Depreciable real estate reserve, net of recoveries		5,789		5,789
Equity in net income from unconsolidated joint venture	481	660	847	786
Loss on early extinguishment of debt	(10)		(76)
Income from continuing operations	20,063	16,419	36,481	24,122
Net income from discontinued operations	1,720	1,036	2,886	2,197
Net income	21,783	17,455	39,367	26,319
Net income attributable to noncontrolling interests in other partnerships	(1,599)	(2,067)	(3,112)	(3,440)
Net income attributable to ROP common unitholder	20,184	15,388	36,255	22,879
Amounts attributable to ROP common unitholders:
Income from continuing operations	18,464	14,352	33,369	20,682
Discontinued operations	1,720	1,036	2,886	2,197
Net income attributable to ROP common unitholder	$ 20,184	$ 15,388	$ 36,255	$ 22,879

XML

Significant Accounting Policies

6 Months Ended

Jun. 30, 2013

Significant Accounting Policies

Significant Accounting Policies

2. Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include our accounts and those of our subsidiaries, which are wholly-owned or controlled by us. Entities which we do not control through our voting interest and entities which are variable interest entities, but where we are not the primary beneficiary, are accounted for under the equity method or as preferred equity investments.  See Note 5, “Preferred Equity and Other Investment.” ROP’s investments in majority-owned and controlled real estate joint ventures are reflected in the accompanying financial statements on a consolidated basis with a reduction for the noncontrolling partners’ interests.  All significant intercompany balances and transactions have been eliminated.

We consolidate a variable interest entity, or VIE, in which we are considered the primary beneficiary. The primary beneficiary of a VIE is the entity that has (i) the power to direct the activities that most significantly impact the entity’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could be significant to the VIE.

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

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

Investment in Commercial Real Estate Properties

On a periodic basis, we assess whether there are any indications that the value of our real estate properties may be impaired or that their carrying value may not be recoverable.  A property’s value is considered impaired if management’s estimate of the aggregate future cash flows (undiscounted and without interest charges for consolidated properties) to be generated by the property is less than the carrying value of the property.  To the extent impairment has occurred, the loss will be measured as the excess of the carrying amount of the property over the calculated fair value of the property.  In addition, we assess our investment in an unconsolidated joint venture for recoverability, and if it is determined that a loss in value of the investment is other than temporary, we write down the investment to its fair value.  We evaluate our equity investment for impairment based on the joint venture’s projected discounted cash flows.  We do not believe that the values of any of our consolidated properties or equity investment were impaired at either June 30, 2013 or December 31, 2012.

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

We recognized an increase of approximately $5.2 million, $10.7 million, $4.8 million and $9.9 million in rental revenue for the three and six months ended June 30, 2013 and 2012, respectively, for the amortization of aggregate below-market leases in excess of above-market leases and a reduction in lease origination costs, resulting from the allocation of the purchase price of the applicable properties.  We recognized an increase in interest expense for the amortization of above-market rate mortgages assumed of approximately $0.1 million, $0.2 million, $0.1 million and $0.3 million for the three and six months ended June 30, 2013 and 2012, respectively.

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

	June 30, 2013			December 31, 2012
Identified intangible assets (included in other assets):
Gross amount	$	199,845		$	199,845
Accumulated amortization	(133,257		)	(125,009		)
Net	$	66,588		$	74,836
Identified intangible liabilities (included in deferred revenue):
Gross amount	$	399,088		$	399,088
Accumulated amortization	(245,354		)	(227,637		)
Net	$	153,734		$	171,451

Investments in Unconsolidated Joint Ventures

We account for our investments in unconsolidated joint ventures under the equity method of accounting as we exercise significant influence, but do not control the entity and are not considered to be the primary beneficiary. We consolidate the joint ventures that we control or which are VIEs and where we are considered to be the primary beneficiary. In all the joint ventures, the rights of the joint venture partner are both protective as well as participating. Unless the joint venture is determined to be a VIE and we are the primary beneficiary in a VIE, these participating rights preclude us from consolidating these non-VIE entities. This investment is recorded initially at cost, as investment in unconsolidated joint venture, and subsequently adjusted for equity in net income (loss) and cash contributions and distributions. Any difference between the carrying amount of this investment on our balance sheet and the underlying equity in net assets is amortized as an adjustment to equity in net income (loss) of unconsolidated joint venture over the lesser of the joint venture term or 10 years. Equity income (loss) from unconsolidated joint venture is allocated based on our ownership or economic interest in the joint venture. When a capital event (as defined in each joint venture agreement) such as a refinancing occurs, if return thresholds are met, future equity income will be allocated at our increased economic interest. We recognize incentive income from unconsolidated real estate joint venture as income to the extent it is earned and not subject to a clawback feature. Distributions we receive from unconsolidated real estate joint venture in excess of our basis in the investment are recorded as offsets to our investment balance if we remain liable for future obligations of the joint venture or may otherwise be committed to provide future additional financial support. In July 2012, we, along with our joint venture partner, sold One Court Square for $481.1 million, which included the assumption of $315.0 million of existing debt by the purchaser, and recognized a gain of $1.0 million on the sale of this property. In January 2013, we, along with our joint venture partner, acquired a preferred equity interest in an entity that holds an interest in a retail property located in Manhattan. See Note 5, “Preferred Equity and Other Investment.”

Revenue Recognition

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

In addition to base rent, our tenants also generally will pay their pro rata share of increases in real estate taxes and operating expenses for the building over a base year. In some leases, in lieu of paying additional rent based upon increases in building operating expenses, the tenant will pay additional rent based upon increases in the wage rate paid to porters over the porters’ wage rate in effect during a base year or increases in the consumer price index over the index value in effect during a base year. In addition, many of our leases contain fixed percentage increases over the base rent to cover escalations.

Electricity is most often supplied by the landlord either on a sub-metered basis, or rent inclusion basis (i.e., a fixed fee is included in the rent for electricity, which amount may increase based upon increases in electricity rates or increases in electrical usage by the tenant). Base building services other than electricity (such as heat, air conditioning and freight elevator service during business hours, and base building cleaning) are typically provided at no additional cost, with the tenant paying additional rent only for services which exceed base building services or for services which are provided outside normal business hours.

These escalations are based on actual expenses incurred in the prior calendar year.  If the expenses in the current year are different from those in the prior year, then during the current year, the escalations will be adjusted to reflect the actual expenses for the current year.

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

Interest income on preferred equity investments is recognized over the life of the investment using the effective interest method and recognized on the accrual basis. Fees received in connection with loan commitments are deferred until the loan is funded and are then recognized over the term of the loan as an adjustment to yield. Anticipated exit fees, whose collection is expected, are also recognized over the term of the loan as an adjustment to yield. Fees on commitments that expire unused are recognized at expiration.

Income recognition is generally suspended for preferred equity investments at the earlier of the date at which payments become 90 days past due or when, in the opinion of management, a full recovery of interest income and principal becomes doubtful.  Interest income recognition is resumed when the loan becomes contractually current and performance is demonstrated to be resumed. Interest is recorded as income on impaired loans only to the extent cash is received. Several of the preferred equity investments provide for accrual of interest at specified rates, which differ from current payment terms. Interest is recognized on such loans at the accrual rate subject to management’s determination that accrued interest and outstanding principal are ultimately collectible, based on the underlying collateral and operations of the borrower. If management cannot make this determination, interest income above the current pay rate is recognized only upon actual receipt.

If we purchase a preferred equity investment at a discount, intend to hold it until maturity and expect to recover the full value of the investment, we accrete the discount into income as an adjustment to yield over the term of the investment. If we purchase a preferred equity investment at a discount with the intention of foreclosing on the collateral, we do not accrete the discount.

Income Taxes

No provision has been made for income taxes in the accompanying consolidated financial statements since such taxes, if any, are the responsibility of the individual partners.

Reserve for Possible Credit Losses

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

Where impairment is indicated on an investment that is held to maturity, a valuation allowance is measured based upon the excess of the recorded investment amount over the net fair value of the collateral.  Any deficiency between the carrying amount of an asset and the calculated value of the collateral is charged to expense.  The write-off of the reserve balance is called a charge-off.  We recorded no loan loss reserves during the three or six months ended June 30, 2013 and 2012, respectively. During the three and six months ended June 30, 2012, we recorded zero and $0.5 million, respectively, in recoveries in connection with the sale of one of our debt investments. This is included in loan loss reserves, net of recoveries in the accompanying consolidated statements of income.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Fair Value Measurements

Fair value is a market-based measurement, not an entity-specific measurement, and should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, FASB guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).

The estimated fair values of tangible and intangible assets and liabilities recorded in connection with business combinations are based on Level 3 inputs. We estimate fair values based on cash flow projections utilizing appropriate discount and/or capitalization rates and available market information.

We determine impairment in real estate investments and preferred equity investments, including intangibles, utilizing cash flow projections that apply estimated revenue and expense growth rates, discount rates and capitalization rates, which are classified as Level 3 inputs. We determined the valuation allowance for loan losses based on Level 3 inputs. See Note 5, “Preferred Equity and Other Investment.”

We use the following methods and assumptions in estimating fair value disclosures for financial instruments.

· Cash and cash equivalents, restricted cash, accounts receivable, and accounts payable and accrued expenses: The carrying amount of cash and cash equivalents, restricted cash, accounts receivable, and accounts payable and accrued expenses reported in our consolidated balance sheets approximates fair value due to the short-term nature of these instruments.

· Preferred equity investments:  The fair value of preferred equity investments is estimated by discounting the future cash flows using current interest rates at which similar loans with the same maturities would be made to borrowers with similar credit ratings. See “Reserve for Possible Credit Losses” below regarding valuation allowances for loan losses.

· Derivative instruments: The fair value of derivative instruments is based on current market data received from financial sources that trade such instruments and are based on prevailing market data and derived from third party proprietary models based on well recognized financial principles and reasonable estimates about relevant future market conditions.

· Mortgage note and other loans payable and other debt: The fair value of borrowings is estimated by discounting the future cash flows using current interest rates at which similar borrowings could be made by us.

The methodologies used for measuring fair value have been categorized into three broad levels as follows:

Level 1 — Quoted prices in active markets for identical instruments.

Level 2 — Valuations based principally on other observable market parameters, including

· Quoted prices in active markets for similar instruments,

· Quoted prices in less active or inactive markets for identical or similar instruments,

· Other observable inputs (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates), and

· Market corroborated inputs (derived principally from or corroborated by observable market data).

Level 3 — Valuations based significantly on unobservable inputs.

· Valuations based on third-party indications (broker quotes or counterparty quotes) which were, in turn, based significantly on unobservable inputs or were otherwise not supportable as Level 2 valuations.

· Valuations based on internal models with significant unobservable inputs.

These levels form a hierarchy. We follow this hierarchy for our assets and liabilities measured at fair value on a recurring and nonrecurring basis. The classifications are based on the lowest level of input that is significant to the fair value measurement.

Concentrations of Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash investments, preferred equity investments and accounts receivable.  We place our cash investments in excess of insured amounts with high quality financial institutions. The collateral securing our preferred equity investments is located in the New York Metropolitan area. See Note 5, “Preferred Equity and Other Investments.” We perform ongoing credit evaluations of our tenants and require most tenants to provide security deposits or letters of credit.  Though these security deposits and letters of credit are insufficient to meet the total value of a tenant’s lease obligation, they are a measure of good faith and a source of funds to offset the economic costs associated with lost rent and the costs associated with re-tenanting the space.  Although the properties in our real estate portfolio are primarily located in Manhattan, we also have Suburban properties located in Westchester County and Connecticut.  The tenants located in our buildings operate in various industries.  Other than two tenants who account for approximately 5.0% and 3.2% of our annualized cash rent, no other tenant in our portfolio accounted for more than 3.0% of our annualized cash rent at June 30, 2013.  Approximately 18%, 10%, 10%, 9% and 9% of our annualized cash rent for the three months ended June 30, 2013 was attributable to 1185 Avenue of the Americas, 750 Third Avenue, 919 Third Avenue, 810 Seventh Avenue and 1350 Avenue of the Americas, respectively.

Reclassification

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

Accounting Standards Updates

In February 2013, the FASB issued guidance on the presentation and disclosure of reclassification adjustments out of accumulated other comprehensive income, or AOCI. The standard requires an entity to present information about significant items reclassified out of AOCI by component either on the face of the statement where net income is presented or as a separate disclosure in the notes to financial statements. The guidance became effective for calendar year-end public companies beginning in the first quarter of 2013 and its adoption did not have a material impact on our consolidated financial statements.

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Subsequent Events

6 Months Ended

Jun. 30, 2013

Subsequent Events

Subsequent Events

16. Subsequent Events

The sale of 333 West 34th closed on August 9, 2013.  See Note 4, “Assets Held for Sale.”

In August 2013, we entered into a contract to acquire a mixed-use residential and commercial property located at 315 West 33rd Street, New York, New York for $386.0 million.  This transaction is expected to be completed in 2013, subject to customary closing conditions.

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Financial Instruments: Derivatives and Hedging

6 Months Ended

Jun. 30, 2013

Financial Instruments: Derivatives and Hedging

Financial Instruments: Derivatives and Hedging

10. Financial Instruments: Derivatives and Hedging

We recognize all derivatives on the balance sheet at fair value.  Derivatives that are not hedges are adjusted to fair value through earnings.  If a derivative is a hedge, depending on the nature of the hedge, changes in the fair value of the derivative will either be offset against the change in fair value of the hedged asset, liability, or firm commitment through earnings, or recognized in other comprehensive income until the hedged item is recognized in earnings.  The ineffective portion of a derivative’s change in fair value will be immediately recognized in earnings.  Reported net income and capital may increase or decrease prospectively, depending on future levels of interest rates and other variables affecting the fair values of derivative instruments and hedged items, but will have no effect on cash flows.

Accumulated other comprehensive loss at June 30, 2013 consists of approximately $4.3 million from the settlement of hedges, which are being amortized over the remaining term of the related senior unsecured notes. Currently, all of our designated derivative instruments are effective hedging instruments.

Over time, the realized and unrealized gains and losses held in accumulated other comprehensive loss will be reclassified into earnings as an adjustment to interest expense in the same periods in which the hedged interest payments affect earnings. We estimate that approximately $0.9 million of the current balance held in accumulated other comprehensive loss will be reclassified into interest expense within the next 12 months.

The following table presents the effect of our derivative financial instruments on the consolidated statements of comprehensive income for the three months ended June 30, 2013 and 2012, respectively (in thousands):

		Amount of Loss Recognized in Other Comprehensive Loss (Effective Portion) For the Three Months Ended June 30,						Amount of (Gain) or Loss Reclassified from Accumulated Other Comprehensive Loss into Interest Expense (Effective Portion) For the Three Months Ended June 30,					Amount of Loss Recognized in Interest Expense (Ineffective Portion) For the Three Months Ended June 30,
Designation\Cash Flow	Derivative	2013			2012			2013			2012		2013		2012
Qualifying	Interest Rate Swaps/Caps	$	(231	)	$	(434	)	$	(230	)	$	245	$	—	$	(1	)
Non-qualifying	Interest Rate Caps	—			—			—			—		—		—

The following table presents the effect of our derivative financial instruments on the consolidated statements of income for the six months ended June 30, 2013 and 2012, respectively (in thousands):

		Amount of Loss Recognized in Other Comprehensive Loss (Effective Portion) For the Six Months Ended						Amount of (Gain) or Loss Reclassified from Accumulated Other Comprehensive Loss into Interest Expense (Effective Portion) For the Six Months Ended					Amount of Loss Recognized in Interest Expense (Ineffective Portion) For the Six Months Ended
Designation\Cash Flow	Derivative	June 30, 2013			June 30, 2012			June 30,2013			June 30, 2012		June 30, 2013		June 30, 2012
Qualifying	Interest Rate Swaps/Caps	$	(193	)	$	(538	)	$	(477	)	$	489	$	—	$	(1	)
Non-qualifying	Interest Rate Caps/Currency Hedges	—			—			—			—		—		—

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Related Party Transactions (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Affiliate
Related Party Transactions
Profit participation received by related party	$ 0.8	$ 0.7	$ 1.6	$ 1.4
Alliance Building Services
Related Party Transactions
Payments made for services	1.3	1.4	2.5	2.4
SL Green
Related Party Transactions
Allocation of salary and other operating costs from related party	1.6	1.5	3.5	3.2
Insurance expense incurred	$ 1.3	$ 1.2	$ 2.5	$ 2.3

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Significant Accounting Policies (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012
Investment in Commercial Real Estate Properties
Increase in rental revenue from amortization of acquired leases	$ 5,200,000	$ 4,800,000	$ 10,700,000	$ 9,900,000
Increase in interest expense from amortization of above-market rate mortgages	100,000	100,000	200,000	300,000
Identified intangible assets (included in other assets):
Gross amount	199,845,000		199,845,000		199,845,000
Accumulated amortization	(133,257,000)		(133,257,000)		(125,009,000)
Net	66,588,000		66,588,000		74,836,000
Identified intangible liabilities (included in deferred revenue):
Gross amount	399,088,000		399,088,000		399,088,000
Accumulated amortization	(245,354,000)		(245,354,000)		(227,637,000)
Net	$ 153,734,000		$ 153,734,000		$ 171,451,000
Buildings | Minimum
Investment in Commercial Real Estate Properties
Estimated useful life			3 years
Buildings | Maximum
Investment in Commercial Real Estate Properties
Estimated useful life			40 years
Other intangible assets | Minimum
Investment in Commercial Real Estate Properties
Estimated useful life of intangible assets			1 year
Other intangible assets | Maximum
Investment in Commercial Real Estate Properties
Estimated useful life of intangible assets			14 years
Above-market leases | Minimum
Investment in Commercial Real Estate Properties
Estimated useful life of intangible assets			1 year
Above-market leases | Maximum
Investment in Commercial Real Estate Properties
Estimated useful life of intangible assets			14 years
Below-market leases | Minimum
Investment in Commercial Real Estate Properties
Estimated useful life of intangible assets			1 year
Below-market leases | Maximum
Investment in Commercial Real Estate Properties
Estimated useful life of intangible assets			14 years
In-place leases | Minimum
Investment in Commercial Real Estate Properties
Estimated useful life of intangible assets			1 year
In-place leases | Maximum
Investment in Commercial Real Estate Properties
Estimated useful life of intangible assets			14 years

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Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2013

Significant Accounting Policies

Summary of identified intangible assets (acquired above-market leases and in-place leases) and intangible liabilities (acquired below-market leases)

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

	June 30, 2013			December 31, 2012
Identified intangible assets (included in other assets):
Gross amount	$	199,845		$	199,845
Accumulated amortization	(133,257		)	(125,009		)
Net	$	66,588		$	74,836
Identified intangible liabilities (included in deferred revenue):
Gross amount	$	399,088		$	399,088
Accumulated amortization	(245,354		)	(227,637		)
Net	$	153,734		$	171,451

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Organization and Basis of Presentation (Tables)

6 Months Ended

Jun. 30, 2013

Organization and Basis of Presentation

Schedule of commercial office properties

Location	Ownership	Number of Properties	Square Feet	Weighted Average Occupancy (1)
Manhattan	Consolidated properties	13	7,201,400	96.0	%
Suburban	Consolidated properties	17	2,785,500	78.1	%
		30	9,986,900	91.0	%

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

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Fair Value of Financial Instruments (Details) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Fair Value of Financial Instruments
Mortgage note and other loan payable and the senior unsecured notes	$ 1,600,000,000
Debt instrument hedged amount	30,000,000
Floating rate debt inclusive of revolving credit facility	410,000,000
Preferred equity investments	351,301,000	338,579,000
Level 3
Fair Value of Financial Instruments
Mortgage note and other loan payable and the senior unsecured notes	1,700,000,000
Floating rate debt inclusive of revolving credit facility	418,500,000
Level 3 | Minimum
Fair Value of Financial Instruments
Preferred equity investments	333,700,000
Level 3 | Maximum
Fair Value of Financial Instruments
Preferred equity investments	$ 368,900,000

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Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2013

Commitments and Contingencies

Schedule of future minimum lease payments under capital leases and noncancellable operating leases

The following is a schedule of future minimum lease payments under capital lease and non-cancellable operating leases with initial terms in excess of one year as of June 30, 2013 (in thousands):

	Capital lease			Non-cancellable operating leases
2013 (6 months)	$	1,073		$	7,563
2014	2,147			15,127
2015	2,218			15,282
2016	2,361			15,592
2017	2,361			15,592
Thereafter	299,303			932,123
Total minimum lease payments	309,463			$	1,001,279
Less amount representing interest	(282,500		)
Present value of net minimum lease payments	$	26,963

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Significant Accounting Policies (Details 3)	6 Months Ended		3 Months Ended					6 Months Ended
	Jun. 30, 2013 Tenant	Jun. 30, 2013 Annualized cash rent Customer concentration	Jun. 30, 2013 Annualized cash rent Customer concentration 1185 Avenue of the Americas	Jun. 30, 2013 Annualized cash rent Customer concentration 750 Third Avenue	Jun. 30, 2013 Annualized cash rent Customer concentration 919 Third Avenue	Jun. 30, 2013 Annualized cash rent Customer concentration 810 Seventh Avenue	Jun. 30, 2013 Annualized cash rent Customer concentration 1350 Avenue of the Americas	Jun. 30, 2013 Annualized cash rent First tenant Customer concentration	Jun. 30, 2013 Annualized cash rent Second tenant Customer concentration
Concentrations of Credit Risk
Number of tenants concentration risk	2
Percentage of concentration			18.00%	10.00%	10.00%	9.00%	9.00%	5.00%	3.20%
Maximum percentage of annualized cash rent for any one tenant not individually disclosed		3.00%

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Commitments and Contingencies (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013
Capital lease
2013 (6 months)	$ 1,073
2014	2,147
2015	2,218
2016	2,361
2017	2,361
Thereafter	299,303
Total minimum lease payments	309,463
Less amount representing interest	(282,500)
Present value of net minimum lease payments	26,963
Future minimum lease payments under capital lease and non-cancellable operating leases
2013 (6 months)	7,563
2014	15,127
2015	15,282
2016	15,592
2017	15,592
Thereafter	932,123
Total minimum lease payments	$ 1,001,279

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Mortgage Note and Other Loans Payable (Tables)

6 Months Ended

Jun. 30, 2013

Mortgage Note and Other Loans Payable

Schedule of the mortgage note and other loan payable collateralized by the property, assignment of leases and investment

The mortgage note and other loans payable collateralized by the property listed below and assignment of leases and investment at June 30, 2013 and December 31, 2012, respectively, were as follows (amounts in thousands):

Property	Interest Rate(1)		Maturity Date	June 30,  2013		December 31, 2012
609 Partners, LLC(2)	5.00	%	7/2014	$	23	$	23
Other loan payable(3)	8.00	%	9/2019	50,000		50,000
919 Third Avenue(4)	5.12	%	6/2023	500,000		500,000
				$	550,023	$	550,023

(1)	Effective weighted average interest rate for the three months ended June 30, 2013.
(2)	As part of an acquisition, the Operating Partnership issued 63.9 million units of its 5.0% Series E Preferred Units, or the Series E Units, with a liquidation of $1.00 per unit. As of June 30, 2013, approximately 63.8 million Series E Units had been redeemed.
(3)	This loan is secured by a portion of a preferred equity investment.
(4)	We own a 51% controlling interest in the joint venture that is the borrower on this loan. This loan is non-recourse to us.

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Preferred Equity and Other Investment (Details) (USD $)			6 Months Ended
	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2013 Joint venture	Jun. 30, 2013 Preferred equity	Jun. 30, 2013 Preferred equity with initial mandatory redemption on October, 2014	Dec. 31, 2012 Preferred equity with initial mandatory redemption on October, 2014	Jun. 30, 2013 Preferred equity with initial mandatory redemption on July, 2015	Dec. 31, 2012 Preferred equity with initial mandatory redemption on July, 2015	Jun. 30, 2013 Preferred equity with initial mandatory redemption on April, 2016	Dec. 31, 2012 Preferred equity with initial mandatory redemption on April, 2016	Jun. 30, 2013 Preferred equity with initial mandatory redemption on July, 2016	Dec. 31, 2012 Preferred equity with initial mandatory redemption on July, 2016
Preferred equity and other investments
Aggregate weighted average current yield (as a percent)				10.20%
Senior Financing	$ 1,577,246,000				$ 70,000,000		$ 525,000,000		$ 55,986,000		$ 926,260,000
Carrying Value, Net of Discounts and Deferred Origination Fees	351,301,000	338,579,000			9,934,000	9,927,000	105,360,000	99,768,000	22,213,000	18,925,000	213,794,000	209,959,000
Committed additional contribution									3,600,000
Stake in the joint venture (as a percent)			40.00%
Interest rate on preferred equity (as a percent)			8.75%
Investment in unconsolidated joint venture			$ 20,400,000

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Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2013

Significant Accounting Policies

Principles of Consolidation

Principles of Consolidation

The consolidated financial statements include our accounts and those of our subsidiaries, which are wholly-owned or controlled by us. Entities which we do not control through our voting interest and entities which are variable interest entities, but where we are not the primary beneficiary, are accounted for under the equity method or as preferred equity investments.  See Note 5, “Preferred Equity and Other Investment.” ROP’s investments in majority-owned and controlled real estate joint ventures are reflected in the accompanying financial statements on a consolidated basis with a reduction for the noncontrolling partners’ interests.  All significant intercompany balances and transactions have been eliminated.

We consolidate a variable interest entity, or VIE, in which we are considered the primary beneficiary. The primary beneficiary of a VIE is the entity that has (i) the power to direct the activities that most significantly impact the entity’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could be significant to the VIE.

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

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

Investment in Commercial Real Estate Properties

Investment in Commercial Real Estate Properties

On a periodic basis, we assess whether there are any indications that the value of our real estate properties may be impaired or that their carrying value may not be recoverable.  A property’s value is considered impaired if management’s estimate of the aggregate future cash flows (undiscounted and without interest charges for consolidated properties) to be generated by the property is less than the carrying value of the property.  To the extent impairment has occurred, the loss will be measured as the excess of the carrying amount of the property over the calculated fair value of the property.  In addition, we assess our investment in an unconsolidated joint venture for recoverability, and if it is determined that a loss in value of the investment is other than temporary, we write down the investment to its fair value.  We evaluate our equity investment for impairment based on the joint venture’s projected discounted cash flows.  We do not believe that the values of any of our consolidated properties or equity investment were impaired at either June 30, 2013 or December 31, 2012.

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

We recognized an increase of approximately $5.2 million, $10.7 million, $4.8 million and $9.9 million in rental revenue for the three and six months ended June 30, 2013 and 2012, respectively, for the amortization of aggregate below-market leases in excess of above-market leases and a reduction in lease origination costs, resulting from the allocation of the purchase price of the applicable properties.  We recognized an increase in interest expense for the amortization of above-market rate mortgages assumed of approximately $0.1 million, $0.2 million, $0.1 million and $0.3 million for the three and six months ended June 30, 2013 and 2012, respectively.

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

	June 30, 2013			December 31, 2012
Identified intangible assets (included in other assets):
Gross amount	$	199,845		$	199,845
Accumulated amortization	(133,257		)	(125,009		)
Net	$	66,588		$	74,836
Identified intangible liabilities (included in deferred revenue):
Gross amount	$	399,088		$	399,088
Accumulated amortization	(245,354		)	(227,637		)
Net	$	153,734		$	171,451

Investments in Unconsolidated Joint Ventures

Investments in Unconsolidated Joint Ventures

We account for our investments in unconsolidated joint ventures under the equity method of accounting as we exercise significant influence, but do not control the entity and are not considered to be the primary beneficiary. We consolidate the joint ventures that we control or which are VIEs and where we are considered to be the primary beneficiary. In all the joint ventures, the rights of the joint venture partner are both protective as well as participating. Unless the joint venture is determined to be a VIE and we are the primary beneficiary in a VIE, these participating rights preclude us from consolidating these non-VIE entities. This investment is recorded initially at cost, as investment in unconsolidated joint venture, and subsequently adjusted for equity in net income (loss) and cash contributions and distributions. Any difference between the carrying amount of this investment on our balance sheet and the underlying equity in net assets is amortized as an adjustment to equity in net income (loss) of unconsolidated joint venture over the lesser of the joint venture term or 10 years. Equity income (loss) from unconsolidated joint venture is allocated based on our ownership or economic interest in the joint venture. When a capital event (as defined in each joint venture agreement) such as a refinancing occurs, if return thresholds are met, future equity income will be allocated at our increased economic interest. We recognize incentive income from unconsolidated real estate joint venture as income to the extent it is earned and not subject to a clawback feature. Distributions we receive from unconsolidated real estate joint venture in excess of our basis in the investment are recorded as offsets to our investment balance if we remain liable for future obligations of the joint venture or may otherwise be committed to provide future additional financial support. In July 2012, we, along with our joint venture partner, sold One Court Square for $481.1 million, which included the assumption of $315.0 million of existing debt by the purchaser, and recognized a gain of $1.0 million on the sale of this property. In January 2013, we, along with our joint venture partner, acquired a preferred equity interest in an entity that holds an interest in a retail property located in Manhattan. See Note 5, “Preferred Equity and Other Investment.”

Revenue Recognition

Revenue Recognition

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

In addition to base rent, our tenants also generally will pay their pro rata share of increases in real estate taxes and operating expenses for the building over a base year. In some leases, in lieu of paying additional rent based upon increases in building operating expenses, the tenant will pay additional rent based upon increases in the wage rate paid to porters over the porters’ wage rate in effect during a base year or increases in the consumer price index over the index value in effect during a base year. In addition, many of our leases contain fixed percentage increases over the base rent to cover escalations.

Electricity is most often supplied by the landlord either on a sub-metered basis, or rent inclusion basis (i.e., a fixed fee is included in the rent for electricity, which amount may increase based upon increases in electricity rates or increases in electrical usage by the tenant). Base building services other than electricity (such as heat, air conditioning and freight elevator service during business hours, and base building cleaning) are typically provided at no additional cost, with the tenant paying additional rent only for services which exceed base building services or for services which are provided outside normal business hours.

These escalations are based on actual expenses incurred in the prior calendar year.  If the expenses in the current year are different from those in the prior year, then during the current year, the escalations will be adjusted to reflect the actual expenses for the current year.

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

Interest income on preferred equity investments is recognized over the life of the investment using the effective interest method and recognized on the accrual basis. Fees received in connection with loan commitments are deferred until the loan is funded and are then recognized over the term of the loan as an adjustment to yield. Anticipated exit fees, whose collection is expected, are also recognized over the term of the loan as an adjustment to yield. Fees on commitments that expire unused are recognized at expiration.

Income recognition is generally suspended for preferred equity investments at the earlier of the date at which payments become 90 days past due or when, in the opinion of management, a full recovery of interest income and principal becomes doubtful.  Interest income recognition is resumed when the loan becomes contractually current and performance is demonstrated to be resumed. Interest is recorded as income on impaired loans only to the extent cash is received. Several of the preferred equity investments provide for accrual of interest at specified rates, which differ from current payment terms. Interest is recognized on such loans at the accrual rate subject to management’s determination that accrued interest and outstanding principal are ultimately collectible, based on the underlying collateral and operations of the borrower. If management cannot make this determination, interest income above the current pay rate is recognized only upon actual receipt.

If we purchase a preferred equity investment at a discount, intend to hold it until maturity and expect to recover the full value of the investment, we accrete the discount into income as an adjustment to yield over the term of the investment. If we purchase a preferred equity investment at a discount with the intention of foreclosing on the collateral, we do not accrete the discount.

Income Taxes

Income Taxes

No provision has been made for income taxes in the accompanying consolidated financial statements since such taxes, if any, are the responsibility of the individual partners.

Reserve for Possible Credit Losses

Reserve for Possible Credit Losses

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

Where impairment is indicated on an investment that is held to maturity, a valuation allowance is measured based upon the excess of the recorded investment amount over the net fair value of the collateral.  Any deficiency between the carrying amount of an asset and the calculated value of the collateral is charged to expense.  The write-off of the reserve balance is called a charge-off.  We recorded no loan loss reserves during the three or six months ended June 30, 2013 and 2012, respectively. During the three and six months ended June 30, 2012, we recorded zero and $0.5 million, respectively, in recoveries in connection with the sale of one of our debt investments. This is included in loan loss reserves, net of recoveries in the accompanying consolidated statements of income.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Fair Value Measurements

Fair Value Measurements

Fair value is a market-based measurement, not an entity-specific measurement, and should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, FASB guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).

The estimated fair values of tangible and intangible assets and liabilities recorded in connection with business combinations are based on Level 3 inputs. We estimate fair values based on cash flow projections utilizing appropriate discount and/or capitalization rates and available market information.

We determine impairment in real estate investments and preferred equity investments, including intangibles, utilizing cash flow projections that apply estimated revenue and expense growth rates, discount rates and capitalization rates, which are classified as Level 3 inputs. We determined the valuation allowance for loan losses based on Level 3 inputs. See Note 5, “Preferred Equity and Other Investment.”

We use the following methods and assumptions in estimating fair value disclosures for financial instruments.

· Cash and cash equivalents, restricted cash, accounts receivable, and accounts payable and accrued expenses: The carrying amount of cash and cash equivalents, restricted cash, accounts receivable, and accounts payable and accrued expenses reported in our consolidated balance sheets approximates fair value due to the short-term nature of these instruments.

· Preferred equity investments:  The fair value of preferred equity investments is estimated by discounting the future cash flows using current interest rates at which similar loans with the same maturities would be made to borrowers with similar credit ratings. See “Reserve for Possible Credit Losses” below regarding valuation allowances for loan losses.

· Derivative instruments: The fair value of derivative instruments is based on current market data received from financial sources that trade such instruments and are based on prevailing market data and derived from third party proprietary models based on well recognized financial principles and reasonable estimates about relevant future market conditions.

· Mortgage note and other loans payable and other debt: The fair value of borrowings is estimated by discounting the future cash flows using current interest rates at which similar borrowings could be made by us.

The methodologies used for measuring fair value have been categorized into three broad levels as follows:

Level 1 — Quoted prices in active markets for identical instruments.

Level 2 — Valuations based principally on other observable market parameters, including

· Quoted prices in active markets for similar instruments,

· Quoted prices in less active or inactive markets for identical or similar instruments,

· Other observable inputs (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates), and

· Market corroborated inputs (derived principally from or corroborated by observable market data).

Level 3 — Valuations based significantly on unobservable inputs.

· Valuations based on third-party indications (broker quotes or counterparty quotes) which were, in turn, based significantly on unobservable inputs or were otherwise not supportable as Level 2 valuations.

· Valuations based on internal models with significant unobservable inputs.

These levels form a hierarchy. We follow this hierarchy for our assets and liabilities measured at fair value on a recurring and nonrecurring basis. The classifications are based on the lowest level of input that is significant to the fair value measurement.

Concentrations of Credit Risk

Concentrations of Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash investments, preferred equity investments and accounts receivable.  We place our cash investments in excess of insured amounts with high quality financial institutions. The collateral securing our preferred equity investments is located in the New York Metropolitan area. See Note 5, “Preferred Equity and Other Investments.” We perform ongoing credit evaluations of our tenants and require most tenants to provide security deposits or letters of credit.  Though these security deposits and letters of credit are insufficient to meet the total value of a tenant’s lease obligation, they are a measure of good faith and a source of funds to offset the economic costs associated with lost rent and the costs associated with re-tenanting the space.  Although the properties in our real estate portfolio are primarily located in Manhattan, we also have Suburban properties located in Westchester County and Connecticut.  The tenants located in our buildings operate in various industries.  Other than two tenants who account for approximately 5.0% and 3.2% of our annualized cash rent, no other tenant in our portfolio accounted for more than 3.0% of our annualized cash rent at June 30, 2013.  Approximately 18%, 10%, 10%, 9% and 9% of our annualized cash rent for the three months ended June 30, 2013 was attributable to 1185 Avenue of the Americas, 750 Third Avenue, 919 Third Avenue, 810 Seventh Avenue and 1350 Avenue of the Americas, respectively.

Reclassification

Reclassification

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

Accounting Standards Updates

Accounting Standards Updates

In February 2013, the FASB issued guidance on the presentation and disclosure of reclassification adjustments out of accumulated other comprehensive income, or AOCI. The standard requires an entity to present information about significant items reclassified out of AOCI by component either on the face of the statement where net income is presented or as a separate disclosure in the notes to financial statements. The guidance became effective for calendar year-end public companies beginning in the first quarter of 2013 and its adoption did not have a material impact on our consolidated financial statements.

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Consolidated Statement of Comprehensive Income (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Consolidated Statement of Comprehensive Income
Net income	$ 20,184	$ 15,388	$ 36,255	$ 22,879
Other comprehensive income (loss):
Net unrealized loss on derivative instruments	(231)	(434)	(193)	(538)
Reclassification of net realized (gain) loss on derivatives designated as cashflow hedges into interest expense	(230)	245	(477)	489
Other comprehensive loss	(461)	(189)	(670)	(49)
Comprehensive income attributable to ROP common unitholder	$ 19,723	$ 15,199	$ 35,585	$ 22,830

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Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Operating Activities
Net income	$ 39,367	$ 26,319
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	76,642	70,572
Equity in net income from unconsolidated joint venture	(847)	(786)
Distributions of cumulative earnings from unconsolidated joint venture	336	444
Depreciable real estate reserve, net of recoveries		(5,789)
Loss on early extinguishment of debt	76
Loan loss reserves, net of recoveries		(472)
Deferred rents receivable	(8,291)	(10,681)
Other non-cash adjustments	(23,243)	(6,869)
Changes in operating assets and liabilities:
Restricted cash - operations	(1,691)	1,164
Tenant and other receivables	(545)	(1,430)
Deferred lease costs	(5,659)	(2,231)
Other assets	(2,567)	(2,881)
Accounts payable, accrued expenses and other liabilities	(4,934)	1,044
Deferred revenue and land leases payable	1,439	(1,305)
Net cash provided by operating activities	70,083	67,099
Investing Activities
Acquisition of real estate property		(102,910)
Additions to land, buildings and improvements	(24,727)	(22,885)
Restricted cash - capital improvements		(670)
Distributions in excess of cumulative earnings from unconsolidated joint venture		152
Preferred equity and other investment, net of repayments	(22,732)	7,777
Net cash used in investing activities	(47,459)	(118,536)
Financing Activities
Repayments of mortgage note and other loans payable		(1,251)
Proceeds from credit facility and senior unsecured notes	370,000	468,339
Repayments of credit facility and senior unsecured notes	(400,000)	(738,639)
Contributions from common unitholder	668,142	1,043,561
Distributions to noncontrolling interests in other partnerships	(6,693)	(8,143)
Distributions to common unitholder	(660,903)	(715,400)
Deferred loan costs and capitalized lease obligation	(8)	(186)
Net cash (used in) provided by financing activities	(29,462)	48,281
Net decrease in cash and cash equivalents	(6,838)	(3,156)
Cash and cash equivalents at beginning of period	34,035	26,645
Cash and cash equivalents at end of period	$ 27,197	$ 23,489

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Property Acquisitions

6 Months Ended

Jun. 30, 2013

Property Acquisitions

Property Acquisitions

3. Property Acquisitions

In September 2012, we acquired the aggregate 267,000 square foot office buildings located at 635 and 641 Sixth Avenue for $173.0 million.

In June 2012, we acquired a 215,000 square foot office building located at 304 Park Avenue South for $135.0 million. The property was acquired with approximately $102.0 million in cash and $33.0 million in units of limited partnership interest of the Operating Partnership.

The following summarizes our allocation of the purchase price of the assets acquired and liabilities assumed upon the closing of these 2012 acquisitions (amounts in thousands):

	635-641 Sixth Avenue		304 Park Avenue South
Land	$	69,848	$	54,189
Building	104,474		75,619
Above market lease value	—		2,824
Acquired in-place leases	7,727		8,265
Assets acquired	182,049		140,897
Below market lease value	9,049		5,897
Liabilities assumed	9,049		5,897
Purchase price allocation	$	173,000	$	135,000
Net consideration funded by us at closing	$	173,000	$	135,000
Equity and/or debt investment held	$	—	$	—
Debt assumed	$	—	$	—

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Organization and Basis of Presentation

6 Months Ended

Jun. 30, 2013

Organization and Basis of Presentation

Organization and Basis of Presentation

1. Organization and Basis of Presentation

Reckson Operating Partnership, L.P., or ROP, commenced operations on June 2, 1995.  The sole general partner of ROP is a wholly-owned subsidiary of SL Green Operating Partnership, L.P., or the Operating Partnership.  The sole limited partner of ROP is the Operating Partnership.

ROP is engaged in the acquisition, ownership, management and operation of commercial real estate properties, principally office properties and also owns land for future development located in the New York City, Westchester County and Connecticut, which collectively is also known as the New York Metropolitan area.

SL Green Realty Corp., or SL Green, and the Operating Partnership were formed in June 1997.  SL Green has qualified, and expects to qualify in the current fiscal year as a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended, or the Code, and operates as a self-administered, self-managed REIT.  A REIT is a legal entity that holds real estate interests and, through payments of dividends to stockholders, is permitted to minimize the payment of Federal income taxes at the corporate level.  Unless the context requires otherwise, all references to “we,” “our,” “us” and the “Company” means ROP and all entities owned or controlled by ROP.

On January 25, 2007, SL Green completed the acquisition of all of the outstanding shares of common stock of Reckson Associates Realty Corp., or RARC, the prior general partner of ROP. This transaction is referred to herein as the Merger.

In connection with the closing of our 2011 revolving credit facility and 2012 credit facility, in which we, along with SL Green and the Operating Partnership are borrowers, SL Green transferred five properties with total assets aggregating to $683.8 million at November 1, 2011 and transferred three additional properties with total assets aggregating to $320.2 million at December 31, 2012, to ROP. Under the Business Combinations guidance, these were determined to be transfers of businesses between the indirect parent company and its wholly owned subsidiary. As such, the assets and liabilities were transferred at their carrying value. These transfers are required to be recorded as of the beginning of the current reporting period as though the assets and liabilities had been transferred at that date. The financial statements and financial information presented for all prior periods have been retrospectively adjusted to furnish comparative information.

On September 30, 2012, SL Green transferred $324.9 million of its preferred equity investments to ROP, one of which was subject to a secured $50.0 million loan. Under the Business Combinations guidance, these transfers were determined to be transfers of assets between the indirect parent company and its wholly-owned subsidiary. As such, the assets were transferred at their carrying value and accounted for prospectively from the date of transfer.

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

Location	Ownership	Number of Properties	Square Feet	Weighted Average Occupancy (1)
Manhattan	Consolidated properties	13	7,201,400	96.0	%
Suburban	Consolidated properties	17	2,785,500	78.1	%
		30	9,986,900	91.0	%

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

At June 30, 2013, we also own a development property encompassing approximately 104,000 square feet as well as an inventory of development parcels that aggregated approximately 81 acres of land in four separate parcels on which we can, based on estimates at June 30, 2013, develop approximately 1.1 million square feet of office space and in which we have invested approximately $67.6 million.  As of June 30, 2013, we also held preferred equity investments and an investment in an unconsolidated joint venture that holds a preferred equity interest in a retail property located in Manhattan with an aggregate book value of $371.7 million.

Basis of Quarterly Presentation

The accompanying consolidated financial statements include the consolidated financial position of ROP and the Service Companies (as defined below) at June 30, 2013 and December 31, 2012, the consolidated results of their operations for the three and six months ended June 30, 2013 and 2012, their statement of capital for the six months ended June 30, 2013 and their statement of cash flows for the six months ended June 30, 2013 and 2012.  Our investments in majority-owned and controlled real estate joint ventures are reflected in the accompanying financial statements on a consolidated basis with a reduction for the noncontrolling partners’ interests.  ROP’s investments in joint ventures, where it owns less than a controlling interest, are reflected in the accompanying consolidated financial statements using the equity method of accounting.  The Service Companies, which provide management, development and construction services to ROP, include Reckson Management Group, Inc., RANY Management Group, Inc., Reckson Construction & Development LLC and Reckson Construction Group New York, Inc. (collectively, the “Service Companies”).  All significant intercompany balances and transactions have been eliminated in the consolidated financial statements.

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

The balance sheet at December 31, 2012 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by U.S. GAAP for complete financial statements.

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Property Acquisitions (Details) (USD $)	Jun. 30, 2012 304 Park Avenue South sqft	Sep. 30, 2012 635-641 Sixth Avenue sqft
Property Acquisition
Area of property (in square feet)	215,000	267,000
Cash paid	$ 102,000,000
Value of units of limited partnership interest in the Operating Partnership	33,000,000
Allocation of the purchase price of the assets acquired and liabilities assumed
Land	54,189,000	69,848,000
Building	75,619,000	104,474,000
Above market lease value	2,824,000
Acquired in-place leases	8,265,000	7,727,000
Assets acquired	140,897,000	182,049,000
Below market lease value	5,897,000	9,049,000
Liabilities assumed	5,897,000	9,049,000
Purchase price allocation	135,000,000	173,000,000
Net consideration funded by us at closing	$ 135,000,000	$ 173,000,000

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Property Acquisitions (Tables)

6 Months Ended

Jun. 30, 2013

Property Acquisitions

Schedule of allocation of the purchase price of the assets acquired and liabilities assumed

The following summarizes our allocation of the purchase price of the assets acquired and liabilities assumed upon the closing of these 2012 acquisitions (amounts in thousands):

	635-641 Sixth Avenue		304 Park Avenue South
Land	$	69,848	$	54,189
Building	104,474		75,619
Above market lease value	—		2,824
Acquired in-place leases	7,727		8,265
Assets acquired	182,049		140,897
Below market lease value	9,049		5,897
Liabilities assumed	9,049		5,897
Purchase price allocation	$	173,000	$	135,000
Net consideration funded by us at closing	$	173,000	$	135,000
Equity and/or debt investment held	$	—	$	—
Debt assumed	$	—	$	—

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Corporate Indebtedness (Tables)

6 Months Ended

Jun. 30, 2013

Corporate Indebtedness

Schedule of senior unsecured notes and other related disclosures by scheduled maturity date

The following table sets forth our senior unsecured notes and other related disclosures as of June 30, 2013 and December 31, 2012, respectively, by scheduled maturity date (amounts in thousands):

Issuance	June 30, 2013 Unpaid Principal Balance		June 30, 2013 Accreted Balance		December 31, 2012 Accreted Balance		Coupon Rate(1)		Effective Rate		Term (in Years)	Maturity
August 13, 2004(2)	$	75,898	$	75,898	$	75,898	5.88	%	5.88	%	10	August 15, 2014
March 31, 2006(2)	255,308		255,185		255,165		6.00	%	6.00	%	10	March 31, 2016
August 5, 2011(3)	250,000		249,651		249,620		5.00	%	5.00	%	7	August 15, 2018
March 16, 2010(3)	250,000		250,000		250,000		7.75	%	7.75	%	10	March 15, 2020
November 15, 2012(3)	200,000		200,000		200,000		4.50	%	4.50	%	10	December 1, 2022
June 27, 2005(4)	7		7		7		4.00	%	4.00	%	20	June 15, 2025
	$	1,031,213	$	1,030,741	$	1,030,690

(1)	Interest on the senior unsecured notes is payable semi annually with principal and unpaid interest due on the scheduled maturity dates.
(2)	On December 27, 2012, we repurchased $42.4 million of aggregate principal amount of these notes, consisting of $22.7 million of the 5.875% Notes and $19.7 million of the 6.0% Notes, for a total consideration of $46.4 million and realized a net loss on early extinguishment of debt of approximately $3.8 million.
(3)	We, SL Green and the Operating Partnership are co-obligors.
(4)	Exchangeable senior debentures which are currently callable at par. In addition, the debentures can be put to us, at the option of the holder at par plus accrued and unpaid interest, on June 15, 2015 and 2020 and upon the occurrence of certain change of control transactions. As a result of the Merger, the adjusted exchange rate for the debentures is 7.7461 shares of SL Green’s common stock per $1,000 of principal amount of debentures and the adjusted reference dividend for the debentures is $1.3491. During the year ended December 31, 2012, we repurchased $650,000 of these bonds at par.

Schedule of Combined aggregate principal maturities of mortgage and other loans payable, revolving credit facility and term loan and senior unsecured notes, including as-of-right extension options

Combined aggregate principal maturities of mortgage note and other loans payable, revolving credit facility and term loan and senior unsecured notes as of June 30, 2013, including as-of-right extension options, were as follows (in thousands):

	Scheduled Amortization		Principal Repayments		Revolving Credit Facility		Term Loan and Senior Unsecured Notes		Total
2013	$	—	$	—	$	—	$	—	$	—
2014	—		23		—		75,898		75,921
2015	—		—		—		7		7
2016	4,116		—		—		255,185		259,301
2017	7,056		—		—		—		7,056
Thereafter	38,220		500,608		40,000		1,099,651		1,678,479
	$	49,392	$	500,631	$	40,000	$	1,430,741	$	2,020,764

Schedule of consolidated interest expense, excluding capitalized interest

Consolidated interest expense, excluding capitalized interest, was comprised of the following (in thousands):

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2013			2012			2013			2012
				As Adjusted						As Adjusted
Interest expense	$	27,597		$	26,601		$	54,339		$	54,510
Interest income	(13		)	(15		)	(26		)	(30		)
Interest expense, net	$	27,584		$	26,586		$	54,313		$	54,480
Interest capitalized	$	—		$	—		$	—		$	—

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Organization and Basis of Presentation (Details) (USD $) In Millions, unless otherwise specified	0 Months Ended
	Dec. 31, 2012 item	Nov. 02, 2011 item	Jun. 30, 2013	Sep. 30, 2012
Organization and Basis of Presentation
Number of properties transferred from the operating partnership to the entity by SL Green	3	5
Carrying value of properties transferred by SL Green	$ 320.2	$ 683.8
Carrying value of preferred equity investments transferred by SL Green				324.9
Carrying value of one of the preferred equity investments subject to secured loan transferred by SL Green				50.0
Real estate properties
Preferred equity investments			371.7
Development parcels
Real estate properties
Number of Properties			4
Area of land (in acres)			81
Estimated area of office space that can be developed on land held (in square feet)			1,100,000
Invested amount for development of office space			$ 67.6
Development property
Real estate properties
Square Feet			104,000
Manhattan | Consolidated properties
Real estate properties
Number of Properties			13
Square Feet			7,201,400
Weighted Average Occupancy ( as a percent)			96.00%
Suburban | Consolidated properties
Real estate properties
Number of Properties			17
Square Feet			2,785,500
Weighted Average Occupancy ( as a percent)			78.10%
Total
Real estate properties
Number of Properties			30
Square Feet			9,986,900
Weighted Average Occupancy ( as a percent)			91.00%

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Segment Information (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013 segment	Jun. 30, 2012	Dec. 31, 2012
Segment Information
Number of reportable segments			2
Segment information
Revenues, including equity in net income from unconsolidated joint venture	$ 138,941	$ 123,507	$ 278,548	$ 246,322
Income from continuing operations	20,063	16,419	36,481	24,122
Total assets	5,387,551		5,387,551		5,396,256
Leverage rate assumption (as a percent)			100.00%
Real Estate Segment
Segment information
Revenues, including equity in net income from unconsolidated joint venture	128,729	123,507	258,505	246,322
Income from continuing operations	11,691	16,419	20,027	23,653
Total assets	5,014,875		5,014,875		5,057,563
Amount of transactions with other segment			0
Preferred Equity and Other Investment Segment
Segment information
Revenues, including equity in net income from unconsolidated joint venture	10,212		20,043
Income from continuing operations	8,372		16,454	469
Total assets	372,676		372,676		338,693
Amount of transactions with other segment			$ 0

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Corporate Indebtedness (Details) (USD $)	3 Months Ended		6 Months Ended			6 Months Ended		6 Months Ended		6 Months Ended						1 Months Ended			0 Months Ended			0 Months Ended	6 Months Ended		0 Months Ended	6 Months Ended		6 Months Ended		6 Months Ended		6 Months Ended		6 Months Ended	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2012	Jun. 30, 2013 2012 Credit Facility	Nov. 30, 2012 2012 Credit Facility	Jun. 30, 2013 Revolving credit facility item	Nov. 30, 2012 Revolving credit facility	Jun. 30, 2013 Revolving credit facility Minimum	Jun. 30, 2013 Revolving credit facility Maximum	Jun. 30, 2013 Term loan	Nov. 30, 2012 Term loan	Jun. 30, 2013 Term loan Minimum	Jun. 30, 2013 Term loan Maximum	Nov. 30, 2012 2011 Revolving Credit Facility	Nov. 30, 2012 2011 Revolving Credit Facility Minimum	Nov. 30, 2012 2011 Revolving Credit Facility Maximum	Dec. 27, 2012 Senior Unsecured Notes	Jun. 30, 2013 Senior Unsecured Notes	Dec. 31, 2012 Senior Unsecured Notes	Dec. 27, 2012 5.88% senior unsecured notes maturing on August 15, 2014	Jun. 30, 2013 5.88% senior unsecured notes maturing on August 15, 2014	Dec. 31, 2012 5.88% senior unsecured notes maturing on August 15, 2014	Dec. 27, 2012 6.00% senior unsecured notes maturing on March 31, 2016	Jun. 30, 2013 6.00% senior unsecured notes maturing on March 31, 2016	Dec. 31, 2012 6.00% senior unsecured notes maturing on March 31, 2016	Jun. 30, 2013 5.00% senior unsecured notes maturing on August 15, 2018	Dec. 31, 2012 5.00% senior unsecured notes maturing on August 15, 2018	Jun. 30, 2013 7.75% senior unsecured notes maturing on March 15, 2020	Dec. 31, 2012 7.75% senior unsecured notes maturing on March 15, 2020	Jun. 30, 2013 4.50% senior unsecured notes maturing on December 1, 2022	Dec. 31, 2012 4.50% senior unsecured notes maturing on December 1, 2022	Jun. 30, 2013 4.00% senior unsecured notes maturing on June 15, 2025	Dec. 31, 2012 4.00% senior unsecured notes maturing on June 15, 2025	Jun. 30, 2013 3.00% exchangeable senior notes due 2017	Jun. 30, 2013 Mortgages and other loans payable	Jun. 30, 2013 Term loan and Senior Unsecured Notes
Corporate Indebtedness
Maximum borrowing capacity							$ 1,600,000,000		$ 1,200,000,000				$ 400,000,000			$ 1,500,000,000
Number of extension options								2
Extension options available								6 months
Extension fee required to be paid (as a percent)								0.10%
Maximum borrowing capacity, optional expansion								1,500,000,000
Interest rate, description						LIBOR										LIBOR
Interest rate added to base rate (as a percent)								1.45%		1.00%	1.75%	1.65%		1.15%	2.00%		1.00%	1.85%
Fee on the unused balance, payable quarterly in arrears (as a percent)										0.15%	0.35%
Facility fee on total commitments, payable quarterly in arrears (as a percent)								0.30%									0.175%	0.45%
Letters of credit						91,600,000
Outstanding under line of credit facility	40,000,000		40,000,000		70,000,000
Undrawn capacity						1,200,000,000
Debt disclosures by scheduled maturity date
Unpaid Principal Balance																				1,031,213,000			75,898,000			255,308,000		250,000,000		250,000,000		200,000,000		7,000
Accreted Balance	1,430,741,000		1,430,741,000		1,430,690,000															1,030,741,000	1,030,690,000		75,898,000	75,898,000		255,185,000	255,165,000	249,651,000	249,620,000	250,000,000	250,000,000	200,000,000	200,000,000	7,000	7,000
Coupon Rate (as a percent)																							5.88%			6.00%		5.00%		7.75%		4.50%		4.00%		3.00%
Effective Rate (as a percent)																							5.88%			6.00%		5.00%		7.75%		4.50%		4.00%
Term																							10 years			10 years		7 years		10 years		10 years		20 years
Principal amount of debentures, basis for conversion																																		1,000
Aggregate principal amount of notes repurchased																			42,400,000			22,700,000			19,700,000
Repayment of debt																			46,400,000																650,000
Loss on early extinguishment of debt	10,000		76,000																3,800,000
Adjusted exchange rate for the debentures (in shares)																																		7.7461
Adjusted reference dividend for debentures																																		1.3491
Scheduled Amortization
2016																																					4,116,000
2017																																					7,056,000
Thereafter																																					38,220,000
Total amortization of debt																																					49,392,000
Principal Repayments
2014																																					23,000	75,898,000
2015																																						7,000
2016																																						255,185,000
Thereafter								40,000,000																													500,608,000	1,099,651,000
Total principal repayments								40,000,000																													500,631,000	1,430,741,000
Scheduled amortization and principal repayments
2014	75,921,000		75,921,000
2015	7,000		7,000
2016	259,301,000		259,301,000
2017	7,056,000		7,056,000
Thereafter	1,678,479,000		1,678,479,000
Total amortization of debt and principal repayments	2,020,764,000		2,020,764,000
Interest expense
Interest expense	27,597,000	26,601,000	54,339,000	54,510,000
Interest income	(13,000)	(15,000)	(26,000)	(30,000)
Interest expense, net	$ 27,584,000	$ 26,586,000	$ 54,313,000	$ 54,480,000

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Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Consolidated Balance Sheets
Tenant and other receivables, allowance	$ 5,719	$ 7,308
Deferred rents receivable, allowance	14,887	16,501
Preferred equity and other investment, discounts and deferred origination fees	2,156	2,217
Deferred costs, accumulated amortization	$ 45,644	$ 40,303

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Mortgage Note and Other Loans Payable

6 Months Ended

Jun. 30, 2013

Mortgage Note and Other Loans Payable

Mortgage Note and Other Loans Payable

6. Mortgage Note and Other Loans Payable

The mortgage note and other loans payable collateralized by the property listed below and assignment of leases and investment at June 30, 2013 and December 31, 2012, respectively, were as follows (amounts in thousands):

Property	Interest Rate(1)		Maturity Date	June 30,  2013		December 31, 2012
609 Partners, LLC(2)	5.00	%	7/2014	$	23	$	23
Other loan payable(3)	8.00	%	9/2019	50,000		50,000
919 Third Avenue(4)	5.12	%	6/2023	500,000		500,000
				$	550,023	$	550,023

(1)	Effective weighted average interest rate for the three months ended June 30, 2013.
(2)	As part of an acquisition, the Operating Partnership issued 63.9 million units of its 5.0% Series E Preferred Units, or the Series E Units, with a liquidation of $1.00 per unit. As of June 30, 2013, approximately 63.8 million Series E Units had been redeemed.
(3)	This loan is secured by a portion of a preferred equity investment.
(4)	We own a 51% controlling interest in the joint venture that is the borrower on this loan. This loan is non-recourse to us.

At June 30, 2013, the gross book value of the property and investment collateralizing the mortgage note and other loans payable was approximately $1.5 billion.

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Consolidated Statements of Income (Parenthetical) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Consolidated Statements of Income
Operating expenses, paid to related parties	$ 4,118	$ 4,088	$ 8,499	$ 7,891

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Commercial real estate properties, at cost:
Land and land interests	$ 918,019	$ 954,731
Building and improvements	3,498,649	3,646,736
Building leasehold and improvements	782,260	782,260
Property under capital lease	22,866	12,208
Commercial real estate properties, gross	5,221,794	5,395,935
Less: accumulated depreciation	(782,949)	(742,659)
Total commercial real estate properties, net	4,438,845	4,653,276
Assets held for sale	194,097
Cash and cash equivalents	27,197	34,035
Restricted cash	22,765	21,074
Tenant and other receivables, net of allowance of $5,719 and $7,308 in 2013 and 2012, respectively	15,196	13,147
Deferred rents receivable, net of allowance of $14,887 and $16,501 in 2013 and 2012, respectively	151,645	150,535
Preferred equity and other investment, net of discounts and deferred origination fees of $2,156 and $2,217 in 2013 and 2012, respectively	371,735	338,579
Deferred costs, net of accumulated amortization of $45,644 and $40,303 in 2013 and 2012, respectively	82,838	91,400
Other assets	83,233	94,210
Total assets	5,387,551	5,396,256
Liabilities
Mortgage note and other loans payable	550,023	550,023
Revolving credit facility	40,000	70,000
Term loan and senior unsecured notes	1,430,741	1,430,690
Accrued interest payable and other liabilities	25,751	25,366
Accounts payable and accrued expenses	37,403	50,692
Deferred revenue	155,870	173,814
Capitalized lease obligation	26,963	17,186
Deferred land leases payable	19,500	20,566
Security deposits	21,209	18,411
Total liabilities	2,307,460	2,356,748
Commitments and contingencies
Capital
General partner capital	2,730,260	2,686,766
Limited partner capital
Accumulated other comprehensive loss	(4,255)	(4,925)
Total ROP partner's capital	2,726,005	2,681,841
Noncontrolling interests in other partnerships	354,086	357,667
Total capital	3,080,091	3,039,508
Total liabilities and capital	$ 5,387,551	$ 5,396,256

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Segment Information (Details 2) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Reconciliation of income from continuing operations to net income attributable to common unitholder
Income from continuing operations	$ 20,063	$ 16,419	$ 36,481	$ 24,122
Net income from discontinued operations	1,720	1,036	2,886	2,197
Net income	21,783	17,455	39,367	26,319
Net income attributable to noncontrolling interests in other partnerships	(1,599)	(2,067)	(3,112)	(3,440)
Net income attributable to ROP common unitholder	$ 20,184	$ 15,388	$ 36,255	$ 22,879

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Assets Held for Sale (Tables)

6 Months Ended

Jun. 30, 2013

Assets Held for Sale

Schedule of income from discontinued operations

The following table summarizes income from discontinued operations for the three and six months ended June 30, 2013 and 2012, respectively (in thousands).

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Revenues
Rental revenue	$	4,569	$	3,402	$	8,250	$	6,936
Escalation and reimbursement revenues	139		567		566		1,050
Total revenues	4,708		3,969		8,816		7,986
Operating expenses	1,247		1,223		2,473		2,413
Real estate taxes	235		239		470		473
Depreciation and amortization	1,506		1,471		2,987		2,903
Total expenses	2,988		2,933		5,930		5,789
Net income from discontinued operations	$	1,720	$	1,036	$	2,886	$	2,197

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Supplemental Disclosure of Non-Cash Investing and Financing Activities

6 Months Ended

Jun. 30, 2013

Supplemental Disclosure of Non-Cash Investing and Financing Activities

Supplemental Disclosure of Non-Cash Investing and Financing Activities

15. Supplemental Disclosure of Non-Cash Investing and Financing Activities

The following table provides information on non-cash investing and financing activities for the six months ended June 30, 2013 and 2012, respectively (in thousands):

	Six Months Ended June 30,
	2013		2012
			As Adjusted
Tenant improvements and capital expenditures payable	$	2,667	$	4,559
Deferred leasing payable	368		344
Contributions from common unitholder	—		33,090
Redemption of Series E units	—		31,698
Capital leased asset	10,657		—
Transfer to net assets held for sale	194,097		—

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Mortgage Note and Other Loans Payable (Details) (USD $) Share data in Millions, except Per Share data, unless otherwise specified	6 Months Ended
	Jun. 30, 2013	Dec. 31, 2012
Mortgage Note Payable
Mortgage note and other loans payable	$ 550,023,000	$ 550,023,000
Gross book value of the property and investment collateralizing the mortgage note and other loan payable	1,500,000,000
Consolidated joint venture
Mortgage Note Payable
Mortgage note and other loans payable	550,023,000	550,023,000
Other loan payable | Consolidated joint venture
Mortgage Note Payable
Interest rate (as a percent)	8.00%
Mortgage note and other loans payable	50,000,000	50,000,000
609 Partners, LLC
Mortgage Note Payable
Number of Series E Preferred Units issued (in shares)	63.9
Dividend rate of Series E Preferred Units (as a percent)	5.00%
Liquidation price per unit of Series E Preferred Units (in dollars per share)	$ 1.00
Series E Preferred Units redeemed (in shares)	63.8
609 Partners, LLC | Consolidated joint venture
Mortgage Note Payable
Interest rate (as a percent)	5.00%
Mortgage note and other loans payable	23,000	23,000
919 Third Avenue New York, NY
Mortgage Note Payable
Controlling interest in the joint venture (as a percent)	51.00%
919 Third Avenue New York, NY | Consolidated joint venture
Mortgage Note Payable
Interest rate (as a percent)	5.12%
Mortgage note and other loans payable	$ 500,000,000	$ 500,000,000

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Significant Accounting Policies (Details 2) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended			1 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013 Joint venture	Jul. 31, 2012 One Court Square
Investment in unconsolidated joint venture
Amortization period of difference between carrying amount of investments and underlying equity in net assets					10 years
Sales price						$ 481.1
Floating rate financing assumed by joint venture						315.0
Recognized gain on sale of interest in property						1.0
Revenue recognition
Additional cost for base building services other than electricity			0
Period after which payments become due			90 days
Income Taxes
Provision for income taxes	0	0	0	0
Reserve for Possible Credit Losses
Loan loss reserves recorded	0	0	0	0
Recoveries recorded in connection with sale of debt investments		$ 0		$ 0.5

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Segment Information (Tables)

6 Months Ended

Jun. 30, 2013

Segment Information

Schedule of selected results of operations and selected asset information

Selected results of operations for the three and six months ended June 30, 2013 and 2012 and selected asset information as of June 30, 2013 and December 31, 2012, regarding our operating segments are as follows (in thousands):

	Real Estate Segment		Preferred Equity and Other Investment Segment		Total Company
Total revenues, including equity in net income from unconsolidated joint venture
Three months ended:
June 30, 2013	$	128,729	$	10,212	$	138,941
June 30, 2012, As Adjusted	123,507		—		123,507
Six months ended:
June 30, 2013	$	258,505	$	20,043	$	278,548
June 30, 2012, As Adjusted	246,322		—		246,322
Income from continuing operations:
Three months ended:
June 30, 2013	$	11,691	$	8,372	$	20,063
June 30, 2012, As Adjusted	16,419		—		16,419
Six months ended:
June 30, 2013	$	20,027	$	16,454	$	36,481
June 30, 2012, As Adjusted	23,653		469		24,122
Total assets:
As of:
June 30, 2013	$	5,014,875	$	372,676	$	5,387,551
December 31, 2012	5,057,563		338,693		5,396,256

Schedule of reconciliation of income from continuing operations to net income attributable to common unitholders

The table below reconciles income from continuing operations to net income attributable to common unitholders for the three and six months ended June 30, 2013 and 2012 (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
				As Adjusted						As Adjusted
Income from continuing operations	$	20,063		$	16,419		$	36,481		$	24,122
Net income from discontinued operations	1,720			1,036			2,886			2,197
Net income	21,783			17,455			39,367			26,319
Net income attributable to noncontrolling interests in other partnerships	(1,599		)	(2,067		)	(3,112		)	(3,440		)
Net income attributable to ROP common unitholder	$	20,184		$	15,388		$	36,255		$	22,879

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Supplemental Disclosure of Non-Cash Investing and Financing Activities (Tables)

6 Months Ended

Jun. 30, 2013

Supplemental Disclosure of Non-Cash Investing and Financing Activities

Schedule of information on non-cash investing and financing activities

The following table provides information on non-cash investing and financing activities for the six months ended June 30, 2013 and 2012, respectively (in thousands):

	Six Months Ended June 30,
	2013		2012
			As Adjusted
Tenant improvements and capital expenditures payable	$	2,667	$	4,559
Deferred leasing payable	368		344
Contributions from common unitholder	—		33,090
Redemption of Series E units	—		31,698
Capital leased asset	10,657		—
Transfer to net assets held for sale	194,097		—

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Preferred Equity and Other Investment

6 Months Ended

Jun. 30, 2013

Preferred Equity and Other Investment

Preferred Equity and Other Investment

5. Preferred Equity and Other Investment

As of June 30, 2013 and December 31, 2012, we held the following preferred equity investments, with an aggregate weighted average current yield of approximately 10.2% at June 30, 2013 (in thousands):

Type	June 30, 2013 SeniorFinancing		June 30, 2013 Carrying Value, Net of Discounts and Deferred Origination Fees		December 31, 2012 Carrying Value, Net of Discounts and Deferred Origination Fees		InitialMandatory Redemption
Preferred equity	$	70,000	$	9,934	$	9,927	October 2014
Preferred equity(1)(2)	525,000		105,360		99,768		July 2015
Preferred equity(1)(3)	55,986		22,213		18,925		April 2016
Preferred equity(1)	926,260		213,794		209,959		July 2016
	$	1,577,246	$	351,301	$	338,579

(1)	The difference between the pay and accrual rates is included as an addition to the principal balance outstanding.
(2)	In June 2013, the redemption date was extended from July 2014 to July 2015.
(3)	As of June 30, 2013, we are committed to fund an additional $3.6 million on this loan.

At June 30, 2013 and December 31, 2012, all preferred equity investments were performing in accordance with the terms of the loan agreements.

The Other Investment, which was acquired in January 2013 and is accounted for under the equity method of accounting, relates to our 40.0% interest in a joint venture that holds a preferred equity interest in an entity that owns a retail property located in Manhattan. The preferred equity investment bears interest at a rate of 8.75% per annum and matures in June 2016. As of June 30, 2013, our investment balance was $20.4 million.

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Preferred Equity and Other Investment (Tables)

6 Months Ended

Jun. 30, 2013

Preferred Equity and Other Investment

Schedule of preferred equity investments

As of June 30, 2013 and December 31, 2012, we held the following preferred equity investments, with an aggregate weighted average current yield of approximately 10.2% at June 30, 2013 (in thousands):

Type	June 30, 2013 SeniorFinancing		June 30, 2013 Carrying Value, Net of Discounts and Deferred Origination Fees		December 31, 2012 Carrying Value, Net of Discounts and Deferred Origination Fees		InitialMandatory Redemption
Preferred equity	$	70,000	$	9,934	$	9,927	October 2014
Preferred equity(1)(2)	525,000		105,360		99,768		July 2015
Preferred equity(1)(3)	55,986		22,213		18,925		April 2016
Preferred equity(1)	926,260		213,794		209,959		July 2016
	$	1,577,246	$	351,301	$	338,579

(1)	The difference between the pay and accrual rates is included as an addition to the principal balance outstanding.
(2)	In June 2013, the redemption date was extended from July 2014 to July 2015.
(3)	As of June 30, 2013, we are committed to fund an additional $3.6 million on this loan.

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Assets Held for Sale (Details) (USD $)	3 Months Ended		6 Months Ended		1 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013 333 West 34th, New York
Income from discontinued operations
Sale price of assets held for sale per agreement					$ 220,300,000
Revenues :
Rental revenue	4,569,000	3,402,000	8,250,000	6,936,000
Escalation and reimbursement revenues	139,000	567,000	566,000	1,050,000
Total revenues	4,708,000	3,969,000	8,816,000	7,986,000
Operating expenses	1,247,000	1,223,000	2,473,000	2,413,000
Real estate taxes	235,000	239,000	470,000	473,000
Depreciation and amortization	1,506,000	1,471,000	2,987,000	2,903,000
Total expenses	2,988,000	2,933,000	5,930,000	5,789,000
Net income from discontinued operations	$ 1,720,000	$ 1,036,000	$ 2,886,000	$ 2,197,000

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Fair Value of Financial Instruments

6 Months Ended

Jun. 30, 2013

Fair Value of Financial Instruments

Fair Value of Financial Instruments

8. Fair Value of Financial Instruments

The following disclosures of estimated fair value were determined by management using available market information and appropriate valuation methodologies, as discussed in Note 2, “Significant Accounting Policies.”  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.

Cash and cash equivalents, restricted cash, accounts receivable and accounts payable balances reasonably approximate their fair values due to the short maturities of these items. Mortgage note and other loans payable and the senior unsecured notes had an estimated fair value based on discounted cash flow models, based on Level 3 inputs, of approximately $1.7 billion, compared to the book value of the related fixed rate debt of approximately $1.6 billion at June 30, 2013.  Our floating rate debt, inclusive of our 2012 credit facility, but excluding $30.0 million of which was swapped, had an estimated fair value based on discounted cash flow models, based on Level 3 inputs, of approximately $418.5 million, compared to the book value of the related floating rate debt of approximately $410.0 million at June 30, 2013.  Our preferred equity investments had an estimated fair value ranging between $333.7 million and $368.9 million, compared to the book value of related preferred equity investments of approximately $351.3 million at June 30, 2013 based on Level 3 inputs.

Disclosure about fair value of financial instruments is based on pertinent information available to us as of June 30, 2013.  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.

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Assets Held for Sale

6 Months Ended

Jun. 30, 2013

Assets Held for Sale

Assets Held for Sale

4. Assets Held for Sale

In June 2013, we entered into an agreement to sell the property located at 333 West 34th, New York, New York for $220.3 million. This transaction closed on August 9, 2013.

Discontinued operations included the results of operations of real estate assets under contract prior to June 30, 2013. This included 333 West 34th, which was held for sale at June 30, 2013.

The following table summarizes income from discontinued operations for the three and six months ended June 30, 2013 and 2012, respectively (in thousands).

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Revenues
Rental revenue	$	4,569	$	3,402	$	8,250	$	6,936
Escalation and reimbursement revenues	139		567		566		1,050
Total revenues	4,708		3,969		8,816		7,986
Operating expenses	1,247		1,223		2,473		2,413
Real estate taxes	235		239		470		473
Depreciation and amortization	1,506		1,471		2,987		2,903
Total expenses	2,988		2,933		5,930		5,789
Net income from discontinued operations	$	1,720	$	1,036	$	2,886	$	2,197

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Consolidated Statement of Capital (USD $) In Thousands, unless otherwise specified	3 Months Ended	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2013
Increase (Decrease) in Partners' Capital
Balance		$ 3,039,508
Contributions		668,142
Distributions		(667,596)
Net income	21,783	39,367
Other comprehensive income		670
Balance	3,080,091	3,080,091
General Partner's Capital | Class A Common Units
Increase (Decrease) in Partners' Capital
Balance		2,686,766
Contributions		668,142
Distributions		(660,903)
Net income		36,255
Balance	2,730,260	2,730,260
Noncontrolling Interests In Other Partnerships
Increase (Decrease) in Partners' Capital
Balance		357,667
Distributions		(6,693)
Net income		3,112
Balance	354,086	354,086
Accumulated Other Comprehensive Loss
Increase (Decrease) in Partners' Capital
Balance		(4,925)
Other comprehensive income		670
Balance	$ (4,255)	$ (4,255)

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Supplemental Disclosure of Non-Cash Investing and Financing Activities (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Supplemental Disclosure of Non-Cash Investing and Financing Activities
Tenant improvements and capital expenditures payable	$ 2,667	$ 4,559
Deferred leasing payable	368	344
Contributions from common unitholder		33,090
Redemption of Series E units		31,698
Capital leased asset	10,657
Transfer to net assets held for sale	$ 194,097

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Financial Instruments: Derivatives and Hedging (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Financial Instruments: Derivatives and Hedging
Loss from settlement of hedges included in accumulated other comprehensive loss	$ 4,300,000		$ 4,300,000
Estimated current balance held in accumulated other comprehensive loss to be reclassified into earnings within the next 12 months			900,000
Amount of Loss Recognized in Other Comprehensive Loss (Effective Portion) on derivatives qualifying as hedges	(231,000)	(434,000)	(193,000)	(538,000)
Amount of (Gain) or Loss Reclassified from Accumulated Other Comprehensive Loss into Interest Expense (Effective Portion) on derivatives qualifying as hedges	(230,000)	245,000	(477,000)	489,000
Amount of Loss Recognized in Interest Expense (Ineffective Portion) on derivatives qualifying as hedges		$ (1,000)		$ (1,000)

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Financial Instruments: Derivatives and Hedging (Tables)

6 Months Ended

Jun. 30, 2013

Financial Instruments: Derivatives and Hedging

Schedule of effect of derivative financial instruments on consolidated statements of comprehensive income

The following table presents the effect of our derivative financial instruments on the consolidated statements of comprehensive income for the three months ended June 30, 2013 and 2012, respectively (in thousands):

		Amount of Loss Recognized in Other Comprehensive Loss (Effective Portion) For the Three Months Ended June 30,						Amount of (Gain) or Loss Reclassified from Accumulated Other Comprehensive Loss into Interest Expense (Effective Portion) For the Three Months Ended June 30,					Amount of Loss Recognized in Interest Expense (Ineffective Portion) For the Three Months Ended June 30,
Designation\Cash Flow	Derivative	2013			2012			2013			2012		2013		2012
Qualifying	Interest Rate Swaps/Caps	$	(231	)	$	(434	)	$	(230	)	$	245	$	—	$	(1	)
Non-qualifying	Interest Rate Caps	—			—			—			—		—		—

The following table presents the effect of our derivative financial instruments on the consolidated statements of income for the six months ended June 30, 2013 and 2012, respectively (in thousands):

		Amount of Loss Recognized in Other Comprehensive Loss (Effective Portion) For the Six Months Ended						Amount of (Gain) or Loss Reclassified from Accumulated Other Comprehensive Loss into Interest Expense (Effective Portion) For the Six Months Ended					Amount of Loss Recognized in Interest Expense (Ineffective Portion) For the Six Months Ended
Designation\Cash Flow	Derivative	June 30, 2013			June 30, 2012			June 30,2013			June 30, 2012		June 30, 2013		June 30, 2012
Qualifying	Interest Rate Swaps/Caps	$	(193	)	$	(538	)	$	(477	)	$	489	$	—	$	(1	)
Non-qualifying	Interest Rate Caps/Currency Hedges	—			—			—			—		—		—

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Related Party Transactions

6 Months Ended

Jun. 30, 2013

Related Party Transactions

Related Party Transactions

11. Related Party Transactions

Cleaning/ Security/ Messenger and Restoration Services

Through Alliance Building Services, or Alliance, First Quality Maintenance, L.P., or First Quality, provides cleaning, extermination and related services, Classic Security LLC provides security services, Bright Star Couriers LLC provides messenger services, and Onyx Restoration Works provides restoration services with respect to certain properties owned by us.  Alliance is partially owned by Gary Green, a son of Stephen L. Green, the chairman of SL Green’s board of directors.  In addition, First Quality has the non-exclusive opportunity to provide cleaning and related services to individual tenants at our properties on a basis separately negotiated with any tenant seeking such additional services.  An affiliate of ours has entered into an arrangement with Alliance whereby it will receive a profit participation above a certain threshold for services provided by Alliance to certain tenants at certain buildings above the base services specified in their lease agreements.  Alliance paid the affiliate approximately $0.8 million, $1.6 million, $0.7 million and $1.4 million for the three and six months ended June 30, 2013 and 2012, respectively.  We paid Alliance approximately $1.3 million, $2.5 million, $1.4 million and $2.4 million for the three and six months ended June 30, 2013 and 2012, respectively, for these services (excluding services provided directly to tenants).

Allocated Expenses from SL Green

Property operating expenses include an allocation of salary and other operating costs from SL Green based on square footage of the related properties.  Such amount was approximately $1.6 million, $3.5 million, $1.5 million and $3.2 million for the three and six months ended June 30, 2013 and 2012, respectively.

Insurance

We obtained insurance coverage through an insurance program administered by SL Green.  In connection with this program we incurred insurance expense of approximately $1.3 million, $2.5 million, $1.2 million and $2.3 million for the three and six months ended June 30, 2013 and 2012, respectively.

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Corporate Indebtedness

6 Months Ended

Jun. 30, 2013

Corporate Indebtedness

Corporate Indebtedness

7. Corporate Indebtedness

2012 Credit Facility

In November 2012, we entered into a $1.6 billion credit facility, or the 2012 credit facility, which refinanced, extended and upsized the previous 2011 revolving credit facility. The 2012 credit facility consists of a $1.2 billion revolving credit facility, or the revolving credit facility, and a $400.0 million term loan, or the term loan facility.  The revolving credit facility matures in March 2017 and includes two six-month extension options, subject to certain conditions and the payment of an extension fee of 10 basis points for each such extension. We also have an option, subject to customary conditions, without the consent of existing lenders, to increase the capacity under the revolving credit facility to $1.5 billion at any time prior to the maturity date for the revolving credit facility, by obtaining additional commitments from our current lenders and other financial institutions. The term loan facility matures on March 30, 2018.

The 2012 credit facility bears interest at a spread over LIBOR ranging from (i) 100 basis points to 175 basis points for loans under the revolving credit facility and (ii) 115 basis points to 200 basis points for loans under the term loan facility, in each case based on the credit rating assigned to our senior unsecured long-term indebtedness. At June 30, 2013, the applicable spread was 145 basis points for revolving credit facility and 165 basis points for the term loan facility. We are required to pay quarterly in arrears a 15 to 35 basis point fee on the unused balance of the commitments under the revolving credit facility. As of June 30, 2013, the facility fee was 30 basis points. At June 30, 2013, we had approximately $91.6 million of outstanding letters of credit, $40.0 million borrowings under the revolving credit facility and $400.0 million outstanding under the term loan facility, with undrawn capacity of $1.2 billion under the 2012 credit facility.

We, SL Green and the Operating Partnership are all borrowers jointly and severally obligated under the 2012 credit facility.  No other subsidiary of ours is an obligor under the 2012 credit facility.

The 2012 credit facility includes certain restrictions and covenants (see Restrictive Covenants below).

2011 Revolving Credit Facility

The 2012 credit facility replaced our $1.5 billion revolving credit facility, or the 2011 revolving credit facility, which was terminated concurrently with the entering into the 2012 credit facility. The 2011 revolving credit facility bore interest at a spread over LIBOR ranging from 100 basis points to 185 basis points, based on the credit rating assigned to our senior unsecured long term indebtedness, and required us to pay quarterly in arrears a 17.5 to 45 basis point facility fee on the total commitments under the 2011 revolving credit facility. The 2011 revolving credit facility included certain restrictions and covenants and, as of the time of the termination of the 2011 revolving credit facility and as of November 2012, we were in compliance with all such restrictions and covenants.

Senior Unsecured Notes

The following table sets forth our senior unsecured notes and other related disclosures as of June 30, 2013 and December 31, 2012, respectively, by scheduled maturity date (amounts in thousands):

Issuance	June 30, 2013 Unpaid Principal Balance		June 30, 2013 Accreted Balance		December 31, 2012 Accreted Balance		Coupon Rate(1)		Effective Rate		Term (in Years)	Maturity
August 13, 2004(2)	$	75,898	$	75,898	$	75,898	5.88	%	5.88	%	10	August 15, 2014
March 31, 2006(2)	255,308		255,185		255,165		6.00	%	6.00	%	10	March 31, 2016
August 5, 2011(3)	250,000		249,651		249,620		5.00	%	5.00	%	7	August 15, 2018
March 16, 2010(3)	250,000		250,000		250,000		7.75	%	7.75	%	10	March 15, 2020
November 15, 2012(3)	200,000		200,000		200,000		4.50	%	4.50	%	10	December 1, 2022
June 27, 2005(4)	7		7		7		4.00	%	4.00	%	20	June 15, 2025
	$	1,031,213	$	1,030,741	$	1,030,690

(1)	Interest on the senior unsecured notes is payable semi annually with principal and unpaid interest due on the scheduled maturity dates.
(2)	On December 27, 2012, we repurchased $42.4 million of aggregate principal amount of these notes, consisting of $22.7 million of the 5.875% Notes and $19.7 million of the 6.0% Notes, for a total consideration of $46.4 million and realized a net loss on early extinguishment of debt of approximately $3.8 million.
(3)	We, SL Green and the Operating Partnership are co-obligors.
(4)	Exchangeable senior debentures which are currently callable at par. In addition, the debentures can be put to us, at the option of the holder at par plus accrued and unpaid interest, on June 15, 2015 and 2020 and upon the occurrence of certain change of control transactions. As a result of the Merger, the adjusted exchange rate for the debentures is 7.7461 shares of SL Green’s common stock per $1,000 of principal amount of debentures and the adjusted reference dividend for the debentures is $1.3491. During the year ended December 31, 2012, we repurchased $650,000 of these bonds at par.

ROP also provides a guaranty of the Operating Partnership’s obligations under its 3.00% Exchangeable Senior Notes due 2017.

Restrictive Covenants

The terms of the 2012 credit facility and certain of our senior unsecured notes include certain restrictions and covenants which may limit, among other things, SL Green’s ability to pay dividends, make certain types of investments, incur additional indebtedness, incur liens and enter into negative pledge agreements and dispose of assets, and which require compliance with financial ratios relating to the minimum amount of tangible net worth, a maximum ratio of total indebtedness to total asset value, a minimum ratio of EBITDA to fixed charges, a maximum ratio of secured indebtedness to total asset value and a maximum ratio of unsecured indebtedness to unencumbered asset value.  The dividend restriction referred to above provides that SL Green will not during any time when a default is continuing, make distributions with respect to its common stock or other equity interests, except to enable SL Green to continue to qualify as a REIT for Federal income tax purposes. As of June 30, 2013 and December 31, 2012, we were in compliance with all such covenants.

Principal Maturities

Combined aggregate principal maturities of mortgage note and other loans payable, revolving credit facility and term loan and senior unsecured notes as of June 30, 2013, including as-of-right extension options, were as follows (in thousands):

	Scheduled Amortization		Principal Repayments		Revolving Credit Facility		Term Loan and Senior Unsecured Notes		Total
2013	$	—	$	—	$	—	$	—	$	—
2014	—		23		—		75,898		75,921
2015	—		—		—		7		7
2016	4,116		—		—		255,185		259,301
2017	7,056		—		—		—		7,056
Thereafter	38,220		500,608		40,000		1,099,651		1,678,479
	$	49,392	$	500,631	$	40,000	$	1,430,741	$	2,020,764

Consolidated interest expense, excluding capitalized interest, was comprised of the following (in thousands):

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2013			2012			2013			2012
				As Adjusted						As Adjusted
Interest expense	$	27,597		$	26,601		$	54,339		$	54,510
Interest income	(13		)	(15		)	(26		)	(30		)
Interest expense, net	$	27,584		$	26,586		$	54,313		$	54,480
Interest capitalized	$	—		$	—		$	—		$	—

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Segment Information

6 Months Ended

Jun. 30, 2013

Segment Information

Segment Information

14. Segment Information

We are engaged in acquiring, owning, managing and leasing commercial properties in Manhattan, Westchester County and Connecticut and have two reportable segments, real estate and preferred equity and other investments.  We evaluate real estate performance and allocate resources based on earnings contribution to income from continuing operations.

Our real estate portfolio is primarily located in the geographical markets of Manhattan, Westchester County and Connecticut.  The primary sources of revenue are generated from tenant rents and escalations and reimbursement revenue.  Real estate property operating expenses consist primarily of security, maintenance, utility costs, real estate taxes and ground rent expense (at certain applicable properties). See Note 5, “Preferred Equity and Other Investment,” for additional details on our preferred equity and other investment.

Selected results of operations for the three and six months ended June 30, 2013 and 2012 and selected asset information as of June 30, 2013 and December 31, 2012, regarding our operating segments are as follows (in thousands):

	Real Estate Segment		Preferred Equity and Other Investment Segment		Total Company
Total revenues, including equity in net income from unconsolidated joint venture
Three months ended:
June 30, 2013	$	128,729	$	10,212	$	138,941
June 30, 2012, As Adjusted	123,507		—		123,507
Six months ended:
June 30, 2013	$	258,505	$	20,043	$	278,548
June 30, 2012, As Adjusted	246,322		—		246,322
Income from continuing operations:
Three months ended:
June 30, 2013	$	11,691	$	8,372	$	20,063
June 30, 2012, As Adjusted	16,419		—		16,419
Six months ended:
June 30, 2013	$	20,027	$	16,454	$	36,481
June 30, 2012, As Adjusted	23,653		469		24,122
Total assets:
As of:
June 30, 2013	$	5,014,875	$	372,676	$	5,387,551
December 31, 2012	5,057,563		338,693		5,396,256

Income from continuing operations represents total revenues less total expenses for the real estate segment and total investment income and equity in net income from unconsolidated joint venture less allocated interest expense and provision for loan losses for the preferred equity and other investment segment.  Interest costs for the preferred equity and other investment segment are imputed assuming 100% leverage at 2012 credit facility borrowing cost. We also allocate loan loss reserves, net of recoveries to the preferred equity and other investment. We do not allocate marketing, general and administrative expenses and transaction related costs to the preferred equity and other investment segment, since we base performance on the individual segments prior to allocating marketing, general and administrative expenses.  All other expenses, except interest, relate entirely to the real estate assets.  There were no transactions between the above two segments.

The table below reconciles income from continuing operations to net income attributable to common unitholders for the three and six months ended June 30, 2013 and 2012 (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
				As Adjusted						As Adjusted
Income from continuing operations	$	20,063		$	16,419		$	36,481		$	24,122
Net income from discontinued operations	1,720			1,036			2,886			2,197
Net income	21,783			17,455			39,367			26,319
Net income attributable to noncontrolling interests in other partnerships	(1,599		)	(2,067		)	(3,112		)	(3,440		)
Net income attributable to ROP common unitholder	$	20,184		$	15,388		$	36,255		$	22,879

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2013

Commitments and Contingencies

Commitments and Contingencies

12. Commitments and Contingencies

We are not presently involved in any material litigation nor, to our knowledge, is any material litigation threatened against us or our properties, other than routine litigation arising in the ordinary course of business.  Management believes the costs, if any, incurred by us related to this litigation will not materially affect our financial position, operating results or liquidity.

The following is a schedule of future minimum lease payments under capital lease and non-cancellable operating leases with initial terms in excess of one year as of June 30, 2013 (in thousands):

	Capital lease			Non-cancellable operating leases
2013 (6 months)	$	1,073		$	7,563
2014	2,147			15,127
2015	2,218			15,282
2016	2,361			15,592
2017	2,361			15,592
Thereafter	299,303			932,123
Total minimum lease payments	309,463			$	1,001,279
Less amount representing interest	(282,500		)
Present value of net minimum lease payments	$	26,963

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Document and Entity Information	6 Months Ended
	Jun. 30, 2013	Jul. 31, 2013
Document and Entity Information
Entity Registrant Name	RECKSON OPERATING PARTNERSHIP LP
Entity Central Index Key	0000930810
Document Type	10-Q
Document Period End Date	Jun. 30, 2013
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		0
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q2

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Environmental Matters

6 Months Ended

Jun. 30, 2013

Environmental Matters

Environmental Matters

13. Environmental Matters

Our management believes that the properties are in compliance in all material respects with applicable Federal, state and local ordinances and regulations regarding environmental issues.  Management is not aware of any environmental liability that it believes would have a materially adverse impact on our financial position, results of operations or cash flows.  Management is unaware of any instances in which it would incur significant environmental cost if any of our properties were sold.