Noncontrolling Interests

9 Months Ended

Sep. 30, 2011

Note 12. Noncontrolling Interests

Noncontrolling interest is the portion of equity in a subsidiary not attributable, directly or indirectly, to a parent. Other than our acquisition of the noncontrolling interest in a property from CPA®:14 in connection with the CPA®:14 Asset Sales (Note 4), there were no changes in our ownership interest in any of our consolidated subsidiaries for the nine months ended September 30, 2011.

The following tables present a reconciliation of total equity, the equity attributable to our shareholders and the equity attributable to noncontrolling interests (in thousands):

	Nine Months Ended September 30, 2011
			W. P. Carey		Noncontrolling
	Total Equity		Members		Interests
Balance at January 1	$	665,474	$	625,013	$	40,461
Shares issued		1,034		1,034		-
Contributions		2,341		-		2,341
Redemption value adjustment		1,282		1,282		-
Purchase of noncontrolling interest ^(a)		(7,491)		(5,879)		(1,612)
Net income (loss)		128,693		129,988		(1,295)
Stock-based compensation expense		13,026		13,026		-
Windfall tax benefit - share incentive plans		2,051		2,051		-
Distributions		(69,648)		(65,174)		(4,474)
Change in other comprehensive loss		(1,321)		(1,176)		(145)
Shares repurchased		(4,301)		(4,301)		-
Balance at September 30	$	731,140	$	695,864	$	35,276

	Nine Months Ended September 30, 2010
			W. P. Carey		Noncontrolling
	Total Equity		Members		Interests
Balance at January 1	$	632,408	$	625,633	$	6,775
Shares issued		3,537		3,537		-
Contributions		11,403		-		11,403
Redemption value adjustment		686		686		-
Tax impact of purchase of WPCI interest		(1,637)		(1,637)		-
Net income (loss)		53,696		54,191		(495)
Stock-based compensation expense		6,695		6,695		-
Reclassification of the noncontrolling interest in Carey Storage ^(b)		22,402		-		22,402
Windfall tax benefit - share incentive plans		1,226		1,226		-
Distributions		(62,479)		(61,267)		(1,212)
Change in other comprehensive (loss) income		(1,882)		(2,911)		1,029
Shares repurchased		(2,060)		(2,060)		-
Balance at September 30	$	663,995	$	624,093	$	39,902

____________

In May 2011, we purchased the noncontrolling interest in the Checkfree venture from CPA®:14 at a total cost of $7.5 million as part of the CPA®:14 Asset Sales. In connection with the purchase, we recorded a $5.9 million reduction in Listed shares, which represents the excess of the fair value of the noncontrolling interest over its carrying value.
During the third quarter of 2010, Carey Storage amended its agreement with a third-party investor, which, among other things, removed a contingent option held by Carey Storage. However, Carey Storage retained a controlling interest in the entity that owns the self-storage properties. As a result, we reclassified the third-party investor's interest from Accounts payable, accrued expenses and other liabilities to Noncontrolling interests on our consolidated balance sheet.

Redeemable Noncontrolling Interest

We account for the noncontrolling interest in WPCI held by one of our officers (Note 3) as a redeemable noncontrolling interest, as we have an obligation to repurchase the interest from that officer, subject to certain conditions. The officer's interest is reflected at estimated redemption value for all periods presented. Redeemable noncontrolling interest, as presented on the consolidated balance sheets, reflects an adjustment of $1.3 million and $0.5 million at September 30, 2011 and December 31, 2010, respectively, to present the noncontrolling interest at redemption value.

The following table presents a reconciliation of redeemable noncontrolling interest (in thousands):

	Nine Months Ended September 30,
	2011		2010
Balance at January 1,	$	7,546	$	7,692
Redemption value adjustment		(1,282)		(686)
Net income		1,241		698
Distributions		(875)		(810)
Change in other comprehensive income (loss)		1		(7)
Balance at September 30,	$	6,631	$	6,887