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Segment Reporting
 9 Months Ended
Sep. 30, 2018
Segment Reporting [Abstract]  
Segment Reporting Segment Reporting
Reportable Segments
During the year ended December 31, 2017, we completed the Medical Office Portfolio Disposition, which resulted in all of our in-service medical office properties being classified within discontinued operations, with the exception of a property that did not meet the criteria for classification as held-for-sale at September 30, 2018. As a result of this transaction, beginning the second quarter of 2017, our medical office properties were no longer presented as a separate reportable segment, with substantially all such operating results being classified within discontinued operations. The remaining medical office property included in continuing operations no longer meets the quantitative thresholds for separate presentation, and is classified as part of our non-reportable Rental Operations. Properties that are not included in our reportable segments, because they do not by themselves meet the
quantitative thresholds for separate presentation as a reportable segment, are generally referred to as non-reportable Rental Operations. Our non-reportable Rental Operations primarily include our remaining office properties and medical office property at September 30, 2018.

As of September 30, 2018, we had two reportable operating segments, the first consisting of the ownership and rental of industrial real estate investments. Our ongoing investments in new real estate investments are determined largely upon anticipated geographic trends in supply and demand for industrial buildings, as well as the real estate needs of our major tenants that operate on a national level. Our strategic initiatives and our allocation of resources have been historically based upon allocation among product types, which was consistent with our designation of reportable segments, and after having sold nearly all of our office and medical office properties we intend to increase our investment in industrial properties and treat them as a single operating and reportable segment. The operations of our industrial properties, as well as our non-reportable Rental Operations, are collectively referred to as "Rental Operations."

Our second reportable segment consists of various real estate services such as property management, asset management, maintenance, leasing, development, general contracting and construction management to third-party property owners and joint ventures, and is collectively referred to as "Service Operations." The Service Operations segment is identified as one single operating segment because the lowest level of financial results reviewed by our chief operating decision maker are the results for the Service Operations segment in total. Further, our reportable segments are managed separately because each segment requires different operating strategies and management expertise.

Revenues by Reportable Segment

The following table shows the revenues for each of the reportable segments, as well as a reconciliation to consolidated revenues (in thousands): 
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2018
 
2017
 
2018
 
2017
Revenues
 
 
 
 
 
 
 
 
Rental Operations:
 
 
 
 
 
 
 
 
Industrial
 
$
194,922

 
$
166,344

 
$
574,866

 
$
485,785

Non-reportable Rental Operations
 
1,481

 
2,979

 
6,300

 
20,577

Service Operations
 
34,986

 
25,217

 
94,552

 
58,192

Total segment revenues
 
231,389

 
194,540

 
675,718

 
564,554

Other revenue
 
509

 
288

 
1,295

 
761

Consolidated revenue from continuing operations
 
231,898

 
194,828

 
677,013

 
565,315

Discontinued operations
 
85

 
4,622

 
117

 
86,026

Consolidated revenue
 
$
231,983

 
$
199,450

 
$
677,130

 
$
651,341



Supplemental Performance Measure

Property-level net operating income on a cash basis ("PNOI") is the non-GAAP supplemental performance measure that we use to evaluate the performance of, and to allocate resources among, the real estate investments in the reportable and operating segments that comprise our Rental Operations. PNOI for our Rental Operations segments is comprised of rental revenues from continuing operations less rental expenses and real estate taxes from continuing operations, along with certain other adjusting items (collectively referred to as "Rental Operations revenues and expenses excluded from PNOI," as shown in the following table). Additionally, we do not allocate interest expense, depreciation expense and certain other non-property specific revenues and expenses (collectively referred to as "Non-Segment Items," as shown in the following table) to our individual operating segments.

We evaluate the performance of our Service Operations reportable segment using net income or loss, as allocated to that segment ("Earnings from Service Operations").

The following table shows a reconciliation of our segment-level measures of profitability to consolidated income from continuing operations before income taxes (in thousands and excluding discontinued operations): 
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2018
 
2017
 
2018
 
2017
PNOI
 
 
 
 
 
 
 
 
Industrial
 
$
142,247

 
$
117,307

 
$
408,843

 
$
344,080

Non-reportable Rental Operations
 
762

 
592

 
2,363

 
2,835

PNOI, excluding all sold properties
 
143,009

 
117,899

 
411,206

 
346,915

PNOI from sold properties included in continuing operations
 
(131
)
 
5,486

 
7,825

 
18,147

PNOI, continuing operations
 
$
142,878

 
$
123,385

 
$
419,031

 
$
365,062

 
 
 
 
 
 
 
 
 
Earnings from Service Operations
 
1,256

 
1,138

 
5,160

 
4,115

 
 

 

 

 

Rental Operations revenues and expenses excluded from PNOI:
 
 
 
 
 
 
 
 
Straight-line rental income and expense, net
 
5,832

 
4,341

 
16,763

 
9,547

Revenues related to lease buyouts
 
—

 
491

 
23

 
10,348

Amortization of lease concessions and above and below market rents
 
593

 
(1,274
)
 
1,599

 
(2,718
)
Intercompany rents and other adjusting items
 
48

 
(108
)
 
206

 
(478
)
Non-Segment Items:
 
 
 
 
 
 
 
 
Equity in earnings of unconsolidated joint ventures
 
5,552

 
1,841

 
15,521

 
58,523

Promote income
 
—

 
—

 
—

 
20,007

Interest expense
 
(21,462
)
 
(20,835
)
 
(62,137
)
 
(65,401
)
Depreciation and amortization expense
 
(78,855
)
 
(67,992
)
 
(232,216
)
 
(197,028
)
Gain on sale of properties
 
(107
)
 
21,952

 
194,741

 
93,339

Impairment charges
 
—

 
(3,622
)
 
—

 
(4,481
)
Interest and other income, net
 
4,129

 
6,404

 
13,319

 
9,197

General and administrative expenses
 
(8,959
)
 
(10,075
)
 
(43,441
)
 
(41,165
)
Gain on land sales
 
3,915

 
5,665

 
7,221

 
8,449

Other operating expenses
 
(668
)
 
(770
)
 
(2,591
)
 
(2,226
)
Loss on extinguishment of debt
 
(89
)
 
(16,568
)
 
(240
)
 
(26,104
)
Other non-segment revenues and expenses, net
 
(1,658
)
 
(1,605
)
 
(3,887
)
 
(3,174
)
Income from continuing operations before income taxes
 
$
52,405

 
$
42,368

 
$
329,072

 
$
235,812

The most comparable GAAP measure to PNOI is income from continuing operations before income taxes. PNOI excludes expenses that materially impact our overall results of operations and, therefore, should not be considered as a substitute for income from continuing operations before income taxes or any other measures derived in accordance with GAAP. Furthermore, PNOI may not be comparable to other similarly titled measures of other companies.