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Fair Value Measurements and the Fair Value Option (Tables)
 9 Months Ended
Sep. 30, 2019
Fair Value Disclosures [Abstract]  
Schedule of Fair Value Measurements
The following table presents fair value measurements (including items that are required to be measured at fair value and items for which the fair value option has been elected) as of September 30, 2019:
(Dollars in millions)
Level 1
 
Level 2
 
Level 3
 
Total
Unconsolidated investments
$
—

 
$
—

 
$
882.8

 
$
882.8

Net currency derivative contracts
—

 
12.6

 
—

 
12.6

Total
$
—

 
$
12.6

 
$
882.8

 
$
895.4

The following table presents fair value measurements (including items that are required to be measured at fair value and items for which the fair value option has been elected) as of December 31, 2018:
(Dollars in millions)
Level 1
 
Level 2
 
Level 3
 
Total
Unconsolidated investments
$
—

 
$
—

 
$
662.2

 
$
662.2

Net currency derivative contracts
—

 
(15.8
)
 
—

 
(15.8
)
Total
$
—

 
$
(15.8
)
 
$
662.2

 
$
646.4
Schedule of Investments in Joint Ventures Held at Fair Value
The following table summarizes the Company's investments in unconsolidated investments held at fair value by type:
(Dollars in millions)
September 30, 2019
 
December 31, 2018
FV Option
$
767.5

 
$
559.7

Funds
115.3

 
102.5

Total
$
882.8

 
$
662.2
Schedule of Changes in Level 3 Investments
The following table presents changes in Level 3 investments in Funds and FV Options for the three and nine months ended September 30, 2019 and 2018:
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
(Dollars in millions)
2019
 
2018
 
2019
 
2018
Beginning balance
$
835.8

 
$
478.3

 
$
662.2

 
$
380.7

Unrealized and realized gains
34.6

 
31.6

 
89.0

 
69.8

Unrealized and realized losses
(7.8
)
 
(8.1
)
 
(11.1
)
 
(14.3
)
Contributions
39.9

 
131.3

 
210.0

 
247.3

Distributions
(12.3
)
 
(10.2
)
 
(60.7
)
 
(60.5
)
Non-cash distributions
(7.4
)
 
(25.2
)
 
(6.6
)
 
(25.3
)
Ending Balance
$
882.8

 
$
597.7

 
$
882.8

 
$
597.7
Schedule of the Funds and Fair Value Option Investments, Significant Inputs
The table below describes the range of unobservable inputs for real estate assets:
 
Estimated Rates Used for
 
Capitalization Rates
 
Discount Rates
Multifamily
4.00% — 8.00%

6.20% — 10.00%
Office
4.10% — 6.75%

5.40% — 8.50%
Retail
6.50% — 10.00%

8.00% — 11.00%
Hotel
6.00% — 7.75%

8.25% — 10.00%
Residential
N/A

12.00%
Schedule of Currency Forward Contracts
The table below details the currency derivative contracts Kennedy Wilson held as of September 30, 2019 and the activity during the nine months ended September 30, 2019. For the nine months ended September 30, 2019, Kennedy Wilson had a gross foreign currency translation loss on its net assets of $37.2 million. See Note 10 for a complete discussion on other comprehensive income including currency derivative contracts and foreign currency translations.
(Dollars, Euros and British Pound Sterling in millions)
 
September 30, 2019
 
Nine Months Ended September 30, 2019
Currency Hedged
Underlying Currency
Notional
Hedge Asset
 
Hedge Liability
 
Change in Unrealized Gains (Losses)
 
Realized Gains (Losses)
 
Interest Expense
 
Cash Received (Paid)
Outstanding
 
 
 
 
 
 
 
 
 
 
 
 
 
EUR
USD
€
175.0

$
15.5

 
$
(0.2
)
 
$
1.7

 
$
10.7

 
$
1.8

 
$
—

EUR(1)
GBP
€
240.8

—

 
(51.8
)
 
6.2

 
—

 
—

 
—

EUR(1)(2)
GBP
 
—

 
—

 
7.4

 
—

 
—

 
—

GBP
USD
£
630.0

49.1

 
—

 
29.9

 
—

 
2.9

 
—

Total Outstanding
 
64.6

 
(52.0
)
 
45.2

 
10.7

 
4.7

 
—

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Settled
 
 
 
 
 
 
 
 
 
 
 
 
 
EUR
USD
 
—

 
—

 
2.4

 
0.1

 
—

 
2.9

GBP
USD
 
—

 
—

 
5.1

 
—

 
0.3

 
31.3

Total Settled
 
 
—

 
—

 
7.5

 
0.1

 
0.3

 
34.2

Total
 
$
64.6

 
$
(52.0
)
 
$
52.7

(3) 
$
10.8

 
$
5.0

 
$
34.2

(1) Hedge is held by KWE on its wholly-owned subsidiaries.
(2) Relates to KWE's Euro Medium Term Note. See discussion in Note 7.
(3) Excludes deferred tax benefit of $10.2 million.