Stock Based Compensation

3 Months Ended

Mar. 31, 2016

Share-based Compensation [Abstract]

Stock Based Compensation

STOCK BASED COMPENSATION

Washington REIT maintains short-term ("STIP") and long-term ("LTIP") incentive plans that allow for stock-based awards to officers and non-officer employees. Stock based awards are provided to officers and non-officer employees, as well as trustees, under the Washington Real Estate Investment Trust 2007 Omnibus Long-Term Incentive Plan which allows for awards in the form of restricted shares, restricted share units, options and other awards up to an aggregate of 2,000,000 shares over the ten-year period in which the plan will be in effect. Restricted share units are converted into shares of our stock upon full vesting through the issuance of new shares.

In February 2016, we adopted a revised long-term incentive plan ("New LTIP") for non-executive officers and other employees that replaced the previous long-term incentive plan for non-executive officers and other employees. The New LTIP is effective January 1, 2016 for performance years beginning on or after that date. Non-executive officers and other employees earn restricted share unit awards under the New LTIP based upon various percentages of their salaries and annual performance calculations. The restricted share unit awards vest ratably over three years beginning on the grant date based upon continued employment. We initially measure compensation expense for awards under the New LTIP based on the fair value at the grant date, and recognize compensation expense for these awards according to a graded vesting schedule over the three-year requisite service period.

Total Compensation Expense

Total compensation expense recognized in the consolidated financial statements for all outstanding share based awards was $1.5 million and $1.9 million for the 2016 and 2015 Quarters, respectively.

Restricted Share Awards

The total fair values of restricted share awards vested was $2.0 million and $1.7 million for the 2016 and 2015 Quarters, respectively.

The total unvested restricted share awards at March 31, 2016 was 248,475 shares, which had a weighted average grant date fair value of $26.33 per share. As of March 31, 2016, the total compensation cost related to unvested restricted share awards was $4.0 million, which we expect to recognize over a weighted average period of 25 months.