Vornado Realty Trust is reducing compensation and cutting 70 staff members as part of a strategy to save approximately $35 million annually, according to an announcement from the firm.

The cost-reduction strategy is a response to ongoing operational challenges in the company's portfolio. In the fourth quarter, Vornado expects to see a $23 million reduction in net income due to an estimated severance and other reduction in force related expenses.

Vornado is also re-shuffling its executive team. Most notably, the current CFO and chief administration officer Joseph Macnow is stepping down. He will remain a senior advisor at the firm. Vornado president Michael Franco will succeed Macnow in addition to maintaining his current role as president.