Consolidated Joint Venture Preferred Equity/Capital Consolidated Joint Venture Preferred Equity/Capital

3 Months Ended

Mar. 31, 2014

Equity [Abstract]

Consolidated Joint Venture Preferred Equity/Capital

Consolidated Joint Venture Preferred Equity/Capital

Our joint venture that is redeveloping the Knickerbocker Hotel raised $45 million through the sale of 3.5% preferred equity/capital under the EB-5 immigrant investor program. The investors in this preferred equity receive a3.25% current annual return, with a 0.25% non-compounding annual return paid at redemption. If the preferred equity is not redeemed within five years, the current return increases to 8.00%. The venture received $41.5 million in gross proceeds ($40.9 million net of issuance costs) in the first quarter of 2014, and the remaining $3.5 million will be received as investors’ visas are approved by the government. We used our 95% share of the proceeds to repay borrowings under our line of credit.