Real Estate Assets, Discontinued Operations and Assets Held for Sale

3 Months Ended

Mar. 31, 2018

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations and Assets Held for Sale

Real Estate Assets, Discontinued Operations and Assets Held for Sale

Real Estate Assets

Real estate assets, excluding assets held for sale, consisted of the following (in thousands):

	March 31, 2018		December 31, 2017
Buildings and tenant improvements	$	4,668,740	$	4,642,832
Land and improvements	1,939,854		1,950,735
Real estate assets	$	6,608,594	$	6,593,567

Discontinued Operations

The following table illustrates the number of sold or held-for-sale properties included in, or excluded from, discontinued operations in this report:

 

	Held-for-Sale at March 31, 2018	Sold Year-to-Date in 2018	Sold in 2017	Total
Total properties included in discontinued operations	—	—	81	81
Properties excluded from discontinued operations	2	6	17	25
Total properties sold or classified as held-for-sale	2	6	98	106

For the properties that were classified in discontinued operations, we allocated interest expense to discontinued operations and have included such interest expense in computing income from discontinued operations. Interest expense allocable to discontinued operations was based upon an allocable share of our consolidated unsecured interest expense, as none of the properties included in discontinued operations were encumbered by secured debt. The allocation of unsecured interest expense to discontinued operations was based upon the gross book value of the unencumbered real estate assets included in discontinued operations as it related to the total gross book value of our unencumbered real estate assets. There were no additional properties classified as discontinued operations during the three months ended March 31, 2018 and, as such, no interest expense was allocated to discontinued operations during that period.

The following table illustrates the operational results of the buildings reflected in discontinued operations (in thousands):  

	Three Months Ended March 31,
	2018			2017
Revenues	$	5		$	46,239
Operating expenses	(13		)	(14,996		)
Depreciation and amortization	—			(19,534		)
Operating (loss) income	(8		)	11,709
Interest expense	—			(6,343		)
(Loss) income before gain on sales	(8		)	5,366
Gain on sale of depreciable properties	132			—
Income from discontinued operations	$	124		$	5,366

There were no capital expenditures for properties within discontinued operations during the three months ended March 31, 2018. Capital expenditures on a cash basis for the three months ended March 31, 2017 were $12.6 million for properties within discontinued operations.

Allocation of Noncontrolling Interests - General Partner

The following table illustrates the General Partner's share of the income attributable to common shareholders from continuing operations and discontinued operations, reduced by the allocation of income between continuing and discontinued operations to the noncontrolling interests (in thousands):

	Three Months Ended March 31,
	2018		2017
Income from continuing operations attributable to common shareholders	$	72,840	$	64,884
Income from discontinued operations attributable to common shareholders	123		5,316
Net income attributable to common shareholders	$	72,963	$	70,200

Allocation of Noncontrolling Interests - Partnership

Substantially all of the income from discontinued operations for all periods presented in the Partnership's Consolidated Statements of Operations and Comprehensive Income is attributable to the common unitholders.

Assets Held for Sale

At March 31, 2018, two in-service properties and ten acres of undeveloped land were classified as held for sale but did not meet the criteria to be classified within discontinued operations. The following table illustrates aggregate balance sheet information for all properties and land held for sale (in thousands):

	Held-for-Sale Properties Included in Continuing Operations
	March 31, 2018			December 31, 2017
Land and improvements	$	9,055		$	8,157
Buildings and tenant improvements	15,283			10,505
Undeveloped land	706			—
Accumulated depreciation	(4,824		)	(2,553		)
Deferred leasing and other costs, net	862			862
Other assets	658			579
Total assets held for sale	$	21,740		$	17,550
Total liabilities related to assets held for sale	$	1,327		$	1,163