Acquisitions and Dispositions

6 Months Ended

Jun. 30, 2019

Acquisitions and dispositions for the periods presented were completed in accordance with our strategy to reposition our investment concentration among the markets in which we operate and to increase our overall investments in quality industrial projects. Transaction costs related to asset acquisitions are capitalized and transaction costs related to business combinations and dispositions are expensed.

Acquisitions

We paid cash of $108.2 million and $208.9 million for asset acquisitions during the six months ended June 30, 2019 and 2018, respectively.

We acquired three properties during the six months ended June 30, 2019. We determined that these three properties did not meet the definition of a business and, accordingly, we accounted for them as asset acquisitions as opposed to business combinations.

The following table summarizes amounts recognized for each major class of assets (in thousands) for these acquisitions during the six months ended June 30, 2019:



Real estate assets	$	104,880
Lease related intangible assets	5,331
Fair value of acquired net assets	$	110,211

The leases in the acquired properties had a weighted average remaining life at acquisition of approximately 5.2 years.

Fair Value Measurements

We determine the fair value of the individual components of real estate asset acquisitions primarily through calculating the "as-if vacant" value of a building, using an income approach, which relies significantly upon internally determined assumptions. We have determined that these estimates primarily rely upon level 3 inputs, which are unobservable inputs based on our own assumptions. The most significant assumptions used in calculating the "as-if vacant" value for acquisition activity during the six months ended June 30, 2019 are as follows:



	Low	High
Exit capitalization rate	4.23%	5.26%
Net rental rate per square foot	$5.90	$15.60

Capitalized acquisition costs were insignificant and the fair value of the three properties acquired during the six months ended June 30, 2019 was substantially the same as the cost of acquisition.

Dispositions

Dispositions of buildings and undeveloped land generated net cash proceeds of $97.5 million and $433.6 million during the six months ended June 30, 2019 and 2018, respectively. Additionally, during the six months ended June 30, 2019, we collected $130.0 million of principal on notes receivable primarily related to the sale of our medical office portfolio (the "Medical Office Portfolio Disposition") during 2017. The number of buildings sold, as well as their classification between continuing and discontinued operations, is disclosed in Note 12.