10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

(Mark One)

ý ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2015

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission File Number: 000-54377

Griffin Capital Essential Asset REIT, Inc.

(Exact name of Registrant as specified in its charter)

Maryland	26-3335705
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

Griffin Capital Plaza, 1520 E. Grand Avenue, El Segundo, California 90245

(Address of principal executive offices)

(310) 469-6100

(Registrant’s telephone number)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Name of Each Exchange on Which Registered
None	None

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, $0.001 par value per share

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ¨    No  ý

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.     Yes  ¨    No  ý

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.    Yes  ý    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).     Yes  ý    No  ¨

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Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of the Form 10-K or any amendment of this Form 10-K. x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer	¨	Accelerated Filer	¨
Non-Accelerated Filer	x  (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     Yes  ¨    No  ý

The aggregate market value of voting common stock held by non-affiliates was $1,806,641,574 assuming a market value of $10.40 per share, as of June 30, 2015, the last business day of the registrant’s most recently completed second fiscal quarter.

As of March 4, 2016, there were 175,381,269 outstanding shares of common stock of the registrant.

Documents Incorporated by Reference:

The Registrant incorporates by reference in Part III (Items 10, 11, 12, 13 and 14) of this Form 10-K portions of its Definitive Proxy Statement for the 2016 Annual Meeting of Stockholders.

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GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

TABLE OF CONTENTS

		Page No.
PART I		5
ITEM 1.	BUSINESS	5
ITEM 1A.	RISK FACTORS	13
ITEM 1B.	UNRESOLVED STAFF COMMENTS	29
ITEM 2.	PROPERTIES	30
ITEM 3.	LEGAL PROCEEDINGS	36
ITEM 4.	MINE SAFETY DISCLOSURES	36
PART II		36
ITEM 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES	36
ITEM 6.	SELECTED FINANCIAL DATA	44
ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	45
ITEM 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	61
ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	62
ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	62
ITEM 9A.	CONTROLS AND PROCEDURES	62
ITEM 9B.	OTHER INFORMATION	62
PART III		63
ITEM 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE	63
ITEM 11.	EXECUTIVE COMPENSATION	63
ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	63
ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE	63
ITEM 14.	PRINCIPAL ACCOUNTING FEES AND SERVICES	63
PART IV		63
ITEM 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES	63
SIGNATURES		66
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS		F-1

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this Form 10-K of Griffin Capital Essential Asset REIT, Inc., other than historical facts, may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend for all such forward-looking statements to be covered by the applicable safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act and Section 21E of the Exchange Act. Such forward-looking statements include, in particular, statements about our plans, strategies, and prospects and are subject to risks, uncertainties, and other factors. Such statements are based on a number of assumptions involving judgments with respect to, among other things, future economic, competitive, and market conditions, all of which are difficult or impossible to predict accurately. To the extent that our assumptions differ from actual results, our ability to meet such forward-looking statements, including our ability to generate positive cash flow from operations and provide distributions to stockholders, our ability to find suitable investment properties, and our ability to be in compliance with certain debt covenants, may be significantly hindered. Therefore, such statements are not intended to be a guarantee of our performance in future periods. Such forward-looking statements can generally be identified by our use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “anticipate,” “estimate,” “believe,” “continue,” or other similar words. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this report is filed with the Securities and Exchange Commission (the “SEC”). We cannot guarantee the accuracy of any such forward-looking statements contained in this Form 10-K, and we do not intend to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

As used in this report, “we,” “us” and “our” refer to Griffin Capital Essential Asset REIT, Inc. All forward-looking statements should be read in light of the risks identified in Part I, Item 1A of this Form 10-K.

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PART I

ITEM 1. BUSINESS

Overview

We were formed as a corporation on August 28, 2008 under the Maryland General Corporation Law primarily with the purpose of acquiring single tenant properties that are essential to the tenant's business. We were taxed as a REIT for the taxable year ended December 31, 2010, and for each year thereafter, after satisfying both financial and non-financial requirements. Our year end is December 31.

We have no employees and are externally advised and managed by an affiliate, Griffin Capital Essential Asset Advisor, LLC, a Delaware limited liability company (the "Advisor"), which was formed on August 27, 2008. Griffin Capital Asset Management Company, LLC ("GAMCO," formerly known as Griffin Capital REIT Holdings, LLC) is the sole member of the Advisor, and Griffin Capital, LLC ("GC") is the sole member of GAMCO. We entered into an advisory agreement for the Public Offerings (as defined below) (as amended and restated, the "Advisory Agreement"), which states that the Advisor is responsible for managing our affairs on a day-to-day basis and identifying and making acquisitions and investments on our behalf. The officers of the Advisor are also officers of Griffin Capital Corporation, a California corporation (the "Sponsor"). The Advisory Agreement has a one-year term, and it may be renewed for an unlimited number of successive one-year periods by our board of directors.

On February 20, 2009, we commenced a private offering to accredited investors only pursuant to a confidential private placement memorandum. On May 6, 2009, we satisfied our minimum offering requirement and commenced operations. We declared our first distribution to stockholders in the second quarter of 2009, which was paid on June 15, 2009.

We terminated our private offering on November 6, 2009 and began our initial offering to the public of a maximum of 82,500,000 shares of common stock, consisting of 75,000,000 shares of common stock at an initial price of $10.00 per share (the "Primary Public Offering") and 7,500,000 shares at an initial price of $9.50 per share pursuant to our distribution reinvestment plan ("DRP") (together with the Primary Public Offering, our "Initial Public Offering"). On April 25, 2013, we terminated our Initial Public Offering, having issued approximately 19,200,570 total shares of our common stock for gross proceeds of approximately $191.5 million, including 585,533 shares, or $5.6 million, issued pursuant to the DRP.

On April 26, 2013, we began to offer, in a follow-on offering, up to $1.0 billion in shares of common stock, consisting of approximately 97,200,000 shares at $10.28 per share in the primary offering (the "Primary Follow-On Offering" and together with the Primary Public Offering, the "Primary Public Offerings") and $100.0 million in shares of common stock, consisting of approximately 10,200,000 shares pursuant to the DRP at a price equal to 95% of the share price, which was approximately $9.77 per share (together with the Primary Follow-On Offering, the "Follow-On Offering" and, collectively with the Initial Public Offering, the "Public Offerings"). On April 22, 2014, we announced that we were no longer accepting subscriptions in the Follow-On Offering, as we expected to reach the maximum amount of offering proceeds. We issued 107,144,337 total shares of our common stock for gross proceeds of approximately $1.1 billion in our Follow-On Offering, including 1,774,208 shares, or $17.3 million, issued pursuant to the DRP.

On May 7, 2014, we filed a Registration Statement on Form S-3 with the SEC for the registration of $75.0 million in shares for sale pursuant to the DRP (the "2014 DRP Offering"). On September 22, 2015, we filed a Registration Statement on Form S-3 with the SEC for the registration of $100.0 million in shares for sale pursuant to the DRP (the "2015 DRP Offering" and together with the 2014 DRP Offering, the "DRP Offerings") and terminated the 2014 DRP Offering. In connection with our DRP Offerings, we had issued 8,579,699 shares of our common stock for gross proceeds of approximately $87.3 million through December 31, 2015. The 2015 DRP Offering may be terminated at any time upon 10 days’ prior written notice to stockholders.

On November 21, 2014, we and one of our wholly-owned subsidiaries ("Merger Sub") entered into a merger agreement with Signature Office REIT, Inc. ("SOR"). In connection with the merger (the "SOR Merger"), (1) SOR merged into Merger Sub, and (2) each share of common stock of SOR issued and outstanding was converted into 2.04 shares ("Merger Consideration") of our common stock. On June 10, 2015, we issued approximately 41,800,000 shares of common stock upon the consummation of the SOR Merger. The assets and liabilities of SOR are included in our consolidated financial statements as of the closing date, June 10, 2015. See Note 3, Real Estate, to the consolidated financial statements for further discussion.

On October 22, 2015, our board of directors (the "Board"), at the recommendation of the Nominating and Corporate Governance Committee of the Board (the "Nominating and Corporate Governance Committee") comprised solely of independent directors, approved an estimated value per share of our common stock of $10.40 based on the estimated value of our assets less the estimated value of our liabilities, or net asset value, divided by the number of shares outstanding on a fully diluted basis (the "NAV"), calculated as of September 30, 2015. We are providing this estimated value per share to assist broker

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dealers in connection with their obligations under applicable Financial Industry Regulatory Authority rules with respect to customer account statements. This valuation was performed in accordance with the provisions of Practice Guideline 2013-01, Valuations of Publicly Registered Non-Listed REITs, issued by the Investment Program Association ("IPA") in April 2013, in addition to guidance from the SEC. For a detailed description of how we determined the NAV, see Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Since our inception and through December 31, 2015, we had redeemed 1,753,700 shares of common stock for approximately $17.3 million at a weighted average price per share of $9.88 pursuant to our share redemption program ("SRP").

As of December 31, 2015, we owned 74 properties in 20 states, encompassing approximately 18.6 million rentable square feet, which include the properties acquired in connection with our merger with SOR. For information about acquisitions and revenue concentration by geographical location and industry, see Item 2, Properties.

Primary Investment Objectives

Our primary investment objectives are to invest in income-producing real property in a manner that allows us to qualify as a REIT for federal income tax purposes, provide regular cash distributions to our stockholders, preserve and protect stockholders' invested capital, and achieve appreciation in the value of our properties over the long term. We cannot assure our stockholders that we will attain these primary investment objectives.

Exchange Listing and Other Liquidity Events

Our board of directors will determine when, and if, to apply to have our shares of common stock listed for trading on a national securities exchange, subject to satisfying then-existing applicable listing requirements. Our board of directors has begun to consider the appropriate timing for a liquidity event and has begun to weigh various strategic considerations. Subject to market conditions and the sole discretion of our board of directors, we may seek one or more of the following liquidity events:

• list our shares on a national securities exchange;

• merge, reorganize or otherwise transfer the company or its assets to another entity with listed securities;

• commence the sale of all of our properties and liquidate the company; or

• otherwise create a liquidity event for our stockholders.

However, we cannot assure our stockholders that we will achieve one or more of the above-described liquidity events. Our board of directors has the sole discretion to forego a liquidity event and continue operations if it deems such continuation to be in the best interests of our stockholders. Even if we accomplish one or more of these liquidity events, we cannot guarantee that a public market will develop for the securities listed or that such securities will trade at a price higher than what stockholders paid for their shares.

Investment Strategy

We operate a portfolio of single tenant business essential properties throughout the United States diversified by corporate credit, physical geography, product type and lease duration. Although we have no current intention to do so, we may also invest in single tenant business essential properties outside the United States. We acquire assets consistent with our single tenant acquisition philosophy by focusing primarily on properties:

• essential to the business operations of the tenant;

• located in primary, secondary, and certain select tertiary markets;

• leased to tenants with stable and/or improving credit quality; and

• subject to long-term leases with defined rental rate increases or with short-term leases with high-probability renewal and potential for increasing rent.

Our investment objectives and policies may be amended or changed at any time by our board of directors. Although we have no plans at this time to change any of our investment objectives, our board of directors may change any and all such investment objectives, including our focus on single tenant business essential properties, if they believe such changes are in the best interests of our stockholders. In addition, we may invest in real estate properties other than single tenant business essential properties if the board of directors deems such investments to be in the best interests of our stockholders.

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Our sponsor has been acquiring single tenant business essential properties for two decades. Our sponsor’s positive acquisition and ownership experience with single tenant business essential properties of the type we intend to acquire stems from the following:

• the credit quality of the lease payment is determinable and equivalent to the senior unsecured credit characteristics of the tenant;

• the essential nature of the asset to the tenant’s business provides greater default protection relative to the tenant’s balance sheet debt;

• the percentage recovery in the event of a tenant default is empirically greater than an unsecured lender; and

• long-term leases provide a consistent and predictable income stream across market cycles while short-term leases offer income appreciation upon renewal and reset.

We will seek to provide stockholders the following benefits:

• a cohesive management team experienced in all aspects of real estate investment with a track record of acquiring single tenant business essential assets;

• a clear alignment of interests between management and investors, as certain affiliates of our sponsor invested over $26 million in our portfolio by contributing certain properties to us;

• stable cash flow backed by a portfolio of single tenant business essential real estate assets;

• minimal exposure to operating and maintenance expense increases as we attempt to structure or acquire leases where the tenant assumes the responsibility for these costs;

• contractual lease rate increases enabling distribution growth and a hedge against inflation;

• insulation from short-term economic cycles resulting from the long-term nature of underlying asset leases;

• enhanced stability resulting from diversified credit characteristics of corporate credits; and

• portfolio stability promoted through geographic and product type investment diversification.

We cannot assure our stockholders that any of the properties we acquire will result in the benefits discussed above.

General Acquisition and Investment Policies

We seek to make investments that satisfy the primary investment objective of providing regular cash distributions to our stockholders. However, because a significant factor in the valuation of income-producing real property is its potential for future appreciation, we anticipate that some properties we acquire may have the potential both for growth in value and for providing regular cash distributions to our stockholders.

Our Advisor has substantial discretion with respect to the selection of specific properties. However, each acquisition will be approved by our board of directors. In selecting a potential property for acquisition, we and our Advisor consider a number of factors, including, but not limited to, the following:

• tenant creditworthiness;

• essentialness of the property to the business operations of the tenant;

• lease terms, including length of lease term, scope of landlord responsibilities, presence and frequency of contractual rental increases, renewal option provisions, exclusive and permitted use provisions, co-tenancy requirements and termination options;

• projected demand in the area;

• a property’s geographic location and type;

• proposed purchase price, terms and conditions;

• tenant's and property's historical financial performance;

• projected net cash flow yield and internal rates of return;

• a property’s physical location, visibility, curb appeal and access;

• construction quality and condition;

• potential for capital appreciation;

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• demographics of the area, neighborhood growth patterns, economic conditions, and local market conditions;

• potential capital and tenant improvements and reserves required to maintain the property;

• prospects for liquidity through sale, financing or refinancing of the property;

• the potential for the construction of new properties in the area;

• treatment under applicable federal, state and local tax and other laws and regulations;

• evaluation of title and obtaining of satisfactory title insurance; and

• evaluation of any reasonable ascertainable risks such as environmental contamination.

There is no limitation on the number, size, or type of properties that we may acquire. The number and mix of properties will depend upon real estate market conditions and other circumstances existing at the time of acquisition and the funds available to us for the purchase of real estate. In determining whether to purchase a particular property, we may obtain an option on such property. The amount paid for an option, if any, is normally surrendered if the property is not purchased and may or may not be credited against the purchase price if the property is ultimately purchased.

Description of Leases

We, in most instances, have acquired single tenant properties with existing net leases. When spaces in a property become vacant, existing leases expire, or we acquire properties under development or requiring substantial refurbishment or renovation, we anticipate entering into “net” leases. “Net” leases mean leases that typically require tenants to pay all or a majority of the operating expenses, including real estate taxes, special assessments and sales and use taxes, utilities, insurance, common area maintenance charges, property services and building repairs related to the property, in addition to the lease payments. Under most commercial leases, tenants are obligated to pay a predetermined annual base rent. Some of the leases also will contain provisions that increase the amount of base rent payable at points during the lease term and/or that require the tenant to pay rent based upon a percentage of the tenant’s revenues. Percentage rent can be calculated based upon a number of factors. There are various forms of net leases, typically classified as triple-net or absolute triple-net. Triple-net leases typically require the tenant to pay all costs associated with a property in addition to the base rent and percentage rent, if any. However, often times in triple-net leases certain capital expenditure costs are not paid for by the tenants (such as roof and structure costs). Absolute triple-net leases are those that require tenants to pay for all the costs in a triple-net lease as well as all the capital costs associated with a property.

To the extent we acquire multi-tenant properties, we have, and expect to have, a variety of lease arrangements with the tenants of these properties. Since each lease is an individually negotiated contract between two or more parties, each lease will have different obligations of both the landlord and tenant, and we cannot predict at this time the exact terms of any future leases into which we will enter. We weigh many factors when negotiating specific lease terms, including, but not limited to, the rental rate, creditworthiness of the tenant, location of the property, and type of property. Many large national tenants have standard lease forms that generally do not vary from property to property. We will have limited ability to revise the terms of leases with those tenants. Some of these limited negotiable terms include lease duration and special provisions on the recovery of operating expenses. In certain instances, we may be responsible for normal operating expenses up to a certain amount, which may reduce the amount of operating cash flow available for future investments.

Typically, our tenants will have lease terms of seven to 15 years at the time of the property acquisition. We may acquire properties under which the lease term has partially expired. We also may acquire properties with shorter lease terms if the property is located in a desirable location, is difficult to replace, or has other significant favorable real estate attributes. Generally, the leases require each tenant to procure, at its own expense, commercial general liability insurance, as well as property insurance covering the building for the full replacement value and naming the ownership entity and the lender, if applicable, as the additional insured on the policy.

Our Borrowing Strategy and Policies

We may incur our indebtedness in the form of bank borrowings, purchase money obligations to the sellers of properties, and publicly- or privately-placed debt instruments or financing from institutional investors or other lenders. We may obtain a credit facility or separate loans for each acquisition. Our indebtedness may be unsecured or may be secured by mortgages or other interests in our properties or underlying owner entities. We may use borrowing proceeds to finance acquisitions of new properties, to pay for capital improvements, repairs or buildouts, to refinance existing indebtedness, to pay distributions, to fund redemptions of our shares, or to provide working capital.

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There is no limitation on the amount we can borrow for the purchase of any property. Our aggregate borrowings, secured and unsecured, must be reasonable in relation to our net assets and must be reviewed by our board of directors at least quarterly. At this time, we intend to maintain a leverage ratio of less than 50% to real estate net book value. However, our charter limits our borrowing to 300% of our net assets (equivalent to 75% of the cost of our assets) unless any excess borrowing is approved by a majority of our independent directors and is disclosed to our stockholders in our next quarterly report, along with the justification for such excess. As of December 31, 2015, our leverage ratio (which we define as our debt as a percentage of the net book value of our real estate) was approximately 54%.

We may borrow amounts from our Advisor or its affiliates only if such loan is approved by a majority of our directors, including a majority of our independent directors, not otherwise interested in the transaction, as fair, competitive, commercially reasonable and no less favorable to us than comparable loans between unaffiliated parties under the circumstances.

Except as set forth in our charter regarding debt limits, we may re-evaluate and change our debt strategy and policies in the future without a stockholder vote. Factors that we could consider when re-evaluating or changing our debt strategy and policies include then-current economic and market conditions, the relative cost of debt and equity capital, any acquisition opportunities, the ability of our properties to generate sufficient cash flow to cover debt service requirements and other similar factors. Further, we may increase or decrease our ratio of debt to equity in connection with any change of our borrowing policies.

Acquisition Structure

Although we are not limited as to the form our investments may take, our investments in real estate will generally constitute acquiring fee title or interests in joint ventures or similar entities that own and operate real estate.

We will make acquisitions of our real estate investments directly through our Operating Partnership or indirectly through limited liability companies or limited partnerships, or through investments in joint ventures, partnerships, co-tenancies or other co-ownership arrangements with other owners of properties, affiliates of our Advisor, or other persons.

Insurance on Properties

Generally, the leases require each tenant to procure, at its own expense, commercial general liability insurance, as well as property insurance covering the building for the full replacement value and naming the ownership entity and the lender, if applicable, as the additional insured on the policy. As a precautionary measure, we may obtain, to the extent available, contingent liability and property insurance, as well as loss of rents insurance that covers one or more years of annual rent in the event of a rental loss. In addition, we maintain a pollution insurance policy for all of our properties to insure against the risk of environmental contaminants. However, we may decide not to obtain any or adequate earthquake or similar catastrophic insurance coverage because the premiums are too high, even in instances where it may otherwise be available.

Tenants will be required to provide proof of insurance by furnishing a certificate of insurance to our Advisor on an annual basis. The insurance certificates will be tracked and reviewed for compliance by our property managers.

Conditions to Closing Acquisitions

We intend to obtain at least a Phase I environmental assessment and history for each property we acquire. In addition, we will generally condition our obligation to close the purchase of any investment on the delivery and verification of certain documents from the seller or other independent professionals, including, but not limited to, where appropriate:

• property surveys and site audits;

• appraisal reports;

• building plans and specifications, if available;

• soil reports, seismic studies, flood zone studies, if available;

• licenses, permits, maps and governmental approvals;

• tenant estoppel certificates;

• tenant financial statements and information, as permitted;

• historical financial statements and tax statement summaries of the properties;

• proof of marketable title, subject to such liens and encumbrances as are acceptable to us; and

• liability and title insurance policies.

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Joint Venture Investments

We may acquire properties in joint ventures, some of which may be entered into with affiliates of our Advisor. We may also enter into joint ventures, general partnerships, co-tenancies and other participations, such as Delaware Statutory Trusts (DSTs), with real estate developers, owners and others for the purpose of owning and leasing real properties. Among other reasons, we may want to acquire properties through a joint venture with third parties or affiliates in order to diversify our portfolio of properties in terms of geographic region or property type. Joint ventures may also allow us to acquire an interest in a property without requiring that we fund the entire purchase price. In addition, certain properties may be available to us only through joint ventures. In determining whether to recommend a particular joint venture, our Advisor will evaluate the real property which such joint venture owns or is being formed to own under the same criteria that the Advisor uses to evaluate other real estate investments.

We may enter into joint ventures with affiliates of our Advisor for the acquisition of properties, but only provided that:

• a majority of our directors, including a majority of our independent directors, not otherwise interested in the transaction, approve the transaction as being fair and reasonable to us; and

• the investment by us and such affiliate are on substantially the same terms and conditions.

To the extent possible and if approved by our board of directors, including a majority of our independent directors, we will attempt to obtain a right of first refusal or option to buy the property held by the joint venture and allow such venture partners to exchange their interest for our Operating Partnership's units or to sell their interest to us in its entirety. In the event that the venture partner were to elect to sell property held in any such joint venture, however, we may not have sufficient funds to exercise our right of first refusal to buy the venture partner’s interest in the property held by the joint venture. Entering into joint ventures with affiliates of our Advisor will result in certain conflicts of interest.

Construction and Development Activities

From time to time, we may construct and develop real estate assets or render services in connection with these activities. We may be able to reduce overall purchase costs by constructing and developing a property versus purchasing a completed property. Developing and constructing properties would, however, expose us to risks such as cost overruns, carrying costs of projects under construction or development, availability and costs of materials and labor, weather conditions, and government regulation. To comply with the applicable requirements under federal income tax law, we intend to limit our construction and development activities to performing oversight and review functions, including reviewing the construction design proposals, negotiating and contracting for feasibility studies and supervising compliance with local, state or federal laws and regulations, negotiating contracts, overseeing construction, and obtaining financing. In addition, we may use taxable REIT subsidiaries or certain independent contractors to carry out these oversight and review functions. We will retain independent contractors to perform the actual construction work.

Government Regulations

The properties we acquire likely will be subject to various federal, state and local regulatory requirements, including the Americans with Disabilities Act, environmental regulations, and other laws, such as zoning and state and local fire and life safety requirements. Failure to comply with these requirements could result in the imposition of fines by governmental authorities or awards of damages to private litigants. We intend to acquire properties that are in material compliance with all such regulatory requirements. However, we cannot assure stockholders that these requirements will not be changed or that new requirements will not be imposed which would require significant unanticipated expenditures by us and could have an adverse effect on our financial condition and results of operations.

Disposition Policies

We generally intend to hold each property we acquire for an extended period. However, we may sell a property at any time if, in our judgment, the sale of the property is in the best interests of our stockholders.

The determination of whether a particular property should be sold or otherwise disposed of will generally be made after consideration of relevant factors, including prevailing economic conditions, other investment opportunities and considerations specific to the condition, value and financial performance of the property. In connection with our sales of properties, we may lend the purchaser all or a portion of the purchase price. In these instances, our taxable income may exceed the cash received in the sale.

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We may sell assets to third parties or to affiliates of our Advisor. Our nominating and corporate governance committee of our board of directors, which is comprised solely of independent directors, must review and approve all transactions between us and our Advisor and its affiliates.

Investment Limitations in Our Charter

Our charter places numerous limitations on us with respect to the manner in which we may invest our funds, most of which are those typically required by various provisions of the Statement of Policy Regarding Real Estate Investment Trusts published by the North American Securities Administrators Association (NASAA REIT Guidelines). So long as our shares are not listed on a national securities exchange, the NASAA REIT Guidelines apply to us, and we will not:

• Invest in equity securities unless a majority of our directors, including a majority of our independent directors, not otherwise interested in the transaction approve such investment as being fair, competitive and commercially reasonable.

• Invest in commodities or commodity futures contracts, except for future contracts when used solely for the purpose of hedging in connection with our ordinary business of investing in real estate assets and mortgages.

• Invest in real estate contracts of sale, otherwise known as land sale contracts, unless the contract is in recordable form and is appropriately recorded in the chain of title.

• Make or invest in mortgage loans unless an appraisal is obtained concerning the underlying property, except for those mortgage loans insured or guaranteed by a government or government agency. In cases where our independent directors determine, and in all cases in which the transaction is with any of our directors or our Advisor and its affiliates, we will obtain an appraisal from an independent appraiser. We will maintain such appraisal in our records for at least five years and it will be available to our stockholders for inspection and duplication. We will also obtain a mortgagee’s or owner’s title insurance policy as to the priority of the mortgage or condition of the title.

• Make or invest in mortgage loans, including construction loans, on any one property if the aggregate amount of all mortgage loans on such property would exceed an amount equal to 85% of the appraised value of such property, as determined by an appraisal, unless substantial justification exists for exceeding such limit because of the presence of other loan underwriting criteria.

• Make or invest in mortgage loans that are subordinate to any mortgage or equity interest of any of our directors, our Advisor or their respective affiliates.

• Make investments in unimproved property or indebtedness secured by a deed of trust or mortgage loans on unimproved property in excess of 10% of our total assets.

• Issue equity securities on a deferred payment basis or other similar arrangement.

• Issue debt securities in the absence of adequate cash flow to cover debt service.

• Issue equity securities that are assessable after we have received the consideration for which our board of directors authorized their issuance.

• Issue “redeemable securities” redeemable solely at the option of the holder, which restriction has no effect on our ability to implement our share redemption program.

• When applicable, grant warrants or options to purchase shares to our Advisor or its affiliates or to officers or directors affiliated with our Advisor except on the same terms as options or warrants that are sold to the general public. Further, the amount of the options or warrants cannot exceed an amount equal to 10% of outstanding shares on the date of grant of the warrants and options.

• Lend money to our directors, or to our Advisor or its affiliates, except for certain mortgage loans described above.

Changes in Investment Policies and Limitations

Our charter requires that our independent directors review our investment policies at least annually to determine that the policies we are following are in the best interests of our stockholders. Each determination and the basis therefor are required to be set forth in the applicable meeting minutes. The methods of implementing our investment policies may also vary as new investment techniques are developed. The methods of implementing our investment objectives and policies, except as otherwise provided in our charter, may be altered by a majority of our directors, including a majority of our independent directors, without the approval of our stockholders. The determination by our board of directors that it is no longer in our best interests to continue to be qualified as a REIT shall require the concurrence of two-thirds of the board of directors. Investment

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policies and limitations specifically set forth in our charter, however, may only be amended by a vote of the stockholders holding a majority of our outstanding shares.

Investments in Mortgages

While we intend to emphasize on equity real estate investments and, hence, operate as what is generally referred to as an “equity REIT,” as opposed to a “mortgage REIT,” we may invest in first or second mortgage loans, mezzanine loans secured by an interest in the entity owning the real estate or other similar real estate loans consistent with our REIT status. We may make such loans to developers in connection with construction and redevelopment of real estate properties. Such mortgages may or may not be insured or guaranteed by the Federal Housing Administration, the Veterans Benefits Administration or another third party. We may also invest in participating or convertible mortgages if our directors conclude that we and our stockholders may benefit from the cash flow or any appreciation in the value of the subject property. Such mortgages are similar to equity participation.

Affiliate Transaction Policy

Our board of directors has established a nominating and corporate governance committee, which will review and approve all matters the board believes may involve a conflict of interest. This committee is composed solely of independent directors. This committee of our board of directors will approve all transactions between us and our Advisor and its affiliates.

We own a 10% interest in one affiliated DST property. See Note 4, Investments, to the consolidated financial statements. On June 24, 2013, our board of directors determined that we would not acquire any new properties in which our sponsor, or its executive officers, owns an economic interest in excess of 10% of the contract purchase price. To the extent management and the board of directors determine to acquire a property in which our sponsor owns an economic interest of 10% or less, the board of directors adopted certain procedures that they intend to apply consistently.

Tenant-in-common properties in which our sponsor owns a 10% economic interest or less. For these situations, we will require our sponsor to engage an independent third party real estate broker to market the property for sale. If we determine the price offered through such marketing efforts is a price at which we would have an interest in acquiring the property, we may submit a bid to acquire the same upon substantially the same terms and conditions otherwise dictated by the market. Should the tenant-in-common owners elect to proceed with a transaction with us and our board approves the acquisition of the property upon such terms and conditions, we will obtain an independent third party appraisal. If the appraised value of the property is equal to or greater than the proposed purchase price, we may acquire the property. Investors in the seller of such property will have the option to either (a) elect to receive their pro-rata share of the net cash proceeds from such disposition, or (b) exchange their equity for limited partnership units in our operating partnership which amounts will be grossed-up by 10% since the exchange will not include sales commissions or a dealer manager fee.

Properties owned through a DST format where our sponsor, or its executive officers, owns a 10% economic interest or less. For these situations, we typically will have the option to acquire the balance of the interests in the DST from the other investors after one year from the initial sale to one of the DST investors. If our board determines to acquire those interests, we will obtain an independent third party appraisal on the property. We intend to acquire the interests in the DST based on such appraisal. The DST investors will have the option to either (a) elect to receive their pro-rata share of the net cash proceeds from such disposition, (b) exchange their DST interests for limited partnership units in our operating partnership, or (c) elect to retain their interest in the DST interests. In certain circumstances, the DST investors may only have options (a) and (b) available depending upon the nature and structure of the underlying transaction and the financing related thereto.

Investment Company Act and Certain Other Policies

We intend to operate in such a manner that we will not be subject to regulation under the Investment Company Act of 1940 (1940 Act). Our Advisor will continually review our investment activity to attempt to ensure that we do not come within the application of the 1940 Act. Among other things, our Advisor will attempt to monitor the proportion of our portfolio that is placed in various investments so that we do not come within the definition of an “investment company” under the 1940 Act. If at any time the character of our investments could cause us to be deemed as an investment company for purposes of the 1940 Act, we will take all necessary actions to attempt to ensure that we are not deemed to be an “investment company.” In addition, we do not intend to underwrite securities of other issuers or actively trade in loans or other investments.

Subject to the restrictions we must follow in order to qualify to be taxed as a REIT, we may make investments other than as previously described, although we do not currently intend to do so. We have authority to purchase or otherwise reacquire our shares of common stock or any of our other securities. We have no present intention of repurchasing any of our shares of common stock except pursuant to our share redemption program, and we would only take such action in conformity with applicable federal and state laws and the requirements for qualifying as a REIT under the Code.

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Employees

We have no employees. The employees of our Advisor and its affiliates provide management, acquisition, advisory and certain administrative services for us.

Competition

As we purchase properties for our portfolio, we are in competition with other potential buyers for the same properties, and may have to pay more to purchase the property than if there were no other potential acquirers or we may have to locate another property that meets our investment criteria. Although we intend to acquire properties subject to existing leases, the leasing of real estate is highly competitive in the current market, and we may experience competition for tenants from owners and managers of competing projects. As a result, we may have to provide free rent, incur charges for tenant improvements, or offer other inducements, or we might not be able to timely lease the space, all of which may have an adverse impact on our results of operations. At the time we elect to dispose of our properties, we will also be in competition with sellers of similar properties to locate suitable purchasers for its properties.

Industry Segments

We internally evaluate all of our properties and interests therein as one reportable segment.

ITEM 1A. RISK FACTORS

Below are risks and uncertainties that could adversely affect our operations that we believe are material to stockholders. Other risks and uncertainties may exist that we do not consider material based on the information currently available to us at this time.

Risks Related to an Investment in Griffin Capital Essential Asset REIT, Inc.

We have incurred operating losses to date and have an accumulated deficit.

We have incurred operating losses in the past and have an accumulated deficit, and may incur operating losses in the future. We had net income of $15.6 million and $0.01 million for the fiscal years ended December 31, 2015 and 2014, respectively. We incurred a net loss of $24.5 million for the fiscal year ended December 31, 2013. Our accumulated deficit was approximately $55.0 million, $51.3 million, and $32.6 million as of December 31, 2015, 2014, and 2013, respectively.

We have paid a portion of our distributions from sources other than cash flow from operations; therefore, we will have fewer funds available for the acquisition of properties, and our stockholders’ overall return may be reduced.

In the event we do not have enough cash from operations to fund our distributions, we may borrow, issue additional securities or sell assets in order to fund the distributions. We are not prohibited from undertaking such activities by our charter, bylaws or investment policies, and we may use an unlimited amount from any source to pay our distributions. Through December 31, 2015, we funded 90% of our distributions using cash flows from operations as shown on the statement of cash flows and 10% of our distributions using offering proceeds. See Management's Discussion and Analysis of Financial Condition and Results of Operations - Distributions and Our Distribution Policy, below. If we continue to pay distributions from sources other than cash flow from operations, we will have fewer funds available for acquiring properties, which may reduce our stockholders’ overall returns. Additionally, to the extent distributions exceed cash flow from operations, a stockholder’s basis in our stock may be reduced and, to the extent distributions exceed a stockholder’s basis, the stockholder may recognize a capital gain.

We may be unable to pay or maintain cash distributions or increase distributions over time.

There are many factors that can affect the availability and timing of cash distributions to stockholders. Distributions will be based principally on distribution expectations of our potential investors and cash available from our operations. The amount of cash available for distribution will be affected by many factors, such as our ability to secure properties with leases or originate leases that generate rents to exceed our operating expense levels, as well as many other variables. Actual cash available for distribution may vary substantially from estimates. With limited prior operating history, we cannot assure our stockholders that we will be able to pay or maintain distributions or that distributions will increase over time, nor can we give any assurance that rents from the properties will increase, or that future acquisitions of real properties will increase our cash available for distribution to stockholders. Our actual results may differ significantly from the assumptions used by our board of directors in establishing the distribution rate to stockholders.

There is currently no public trading market for our shares and there may never be one; therefore, it will be difficult for our stockholders to sell their shares including under our share redemption program.

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There is currently no public market for our shares and there may never be one. Our stockholders may not sell their shares unless the buyer meets applicable suitability and minimum purchase standards, which includes owning the stock for at least one year. Our charter also prohibits the ownership of more than 9.8% of our stock, unless waived by our board of directors, which may inhibit large investors from desiring to purchase our stockholders’ shares. Moreover, our share redemption program includes numerous restrictions that would limit our stockholders’ ability to sell their shares to us. Redemption of shares, when requested, will generally be made quarterly. During any calendar year, we will not redeem in excess of 5% of the weighted average number of shares outstanding during the prior calendar year and redemptions will be funded solely from proceeds from our distribution reinvestment plan. Our board of directors could choose to amend, suspend or terminate our share redemption program upon 30 days’ notice. Therefore, it may be difficult for our stockholders to sell their shares promptly or at all. If our stockholders are able to sell their shares, they will likely have to sell them at a substantial discount to the price they paid for the shares. It also is likely that their shares would not be accepted as the primary collateral for a loan. Our stockholders should purchase the shares only as a long-term investment because of the illiquid nature of the shares.

In determining net asset value, or NAV, per share, we relied upon a valuation of our properties as of September 30, 2015. Valuations and appraisals of our properties are estimates of fair value and may not necessarily correspond to realizable value upon the sale of such properties, therefore our new asset value per share may not reflect the amount that would be realized upon a sale of each of our properties.

For the purposes of calculating our NAV per share, an independent third-party appraiser valued our properties as of September 30, 2015. The valuation methodologies used to value our properties involved certain subjective judgments. Ultimate realization of the value of an asset depends to a great extent on economic and other conditions beyond our control and the control of our Advisor and independent appraiser. Further, valuations do not necessarily represent the price at which an asset would sell, since market prices of assets can only be determined by negotiation between a willing buyer and seller. Therefore, the valuations of our properties and our investments in real estate related assets may not correspond to the timely realizable value upon a sale of those assets.

Our NAV per share is somewhat based upon subjective judgments, assumptions and opinions, which may or may not turn out to be correct. Therefore, our NAV per share may not reflect the precise amount that might be paid to stockholders for their shares in a market transaction.

Our net asset value per share was based on an estimate of the value of our properties - consisting principally of illiquid commercial real estate - as of September 30, 2015. The valuation methodologies used by the independent appraiser retained by our board of directors to estimate the value of our properties as of September 30, 2015 involved subjective judgments, assumptions and opinions, which may or may not turn out to be correct. As a result, our net asset value per share may not reflect the precise amount that might be paid to stockholders for their shares in a market transaction.

If our Advisor loses or is unable to obtain key personnel, our ability to implement our investment objectives could be delayed or hindered, which could adversely affect our ability to make distributions and the value of our stockholders’ investment.

Our success depends to a significant degree upon the contributions of certain of our executive officers and other key personnel of our Advisor and sponsor, including Kevin A. Shields, Michael J. Escalante, Joseph E. Miller, David C. Rupert, Mary P. Higgins, Howard S. Hirsch, Don G. Pescara, and Julie A. Treinen, each of whom would be difficult to replace. Our Advisor does not have an employment agreement with any of these key personnel and we cannot guarantee that all, or any particular one, will remain affiliated with us and/or our Advisor. If any of our key personnel were to cease their affiliation with our Advisor, our operating results could suffer. Further, although our sponsor has obtained key person life insurance on some of these individuals, we do not intend to separately maintain key person life insurance on any of these individuals. We believe that our future success depends, in large part, upon our Advisor's ability to hire and retain highly skilled managerial, operational and marketing personnel. Competition for such personnel is intense, and we cannot assure stockholders that our Advisor will be successful in attracting and retaining such skilled personnel. If our Advisor loses or is unable to obtain the services of key personnel or does not establish or maintain appropriate strategic relationships, our ability to implement our investment strategies could be delayed or hindered, and the value of a stockholder's investment may decline.

Our ability to operate profitably will depend upon the ability of our Advisor to efficiently manage our day-to-day operations.

We will rely on our Advisor to manage our business and assets. Our Advisor will make all decisions with respect to our day-to-day operations. Thus, the success of our business will depend in large part on the ability of our Advisor to manage our operations. Any adversity experienced by our Advisor or problems in our relationship with our Advisor could adversely impact the operation of our properties and, consequently, our cash flow and ability to make distributions to our stockholders.

Risks Related to Conflicts of Interest

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Our sponsor, Advisor, property manager and their officers and certain of their key personnel will face competing demands relating to their time, which may cause our operating results to suffer.

Our sponsor, Advisor, property manager and their officers and certain of their key personnel and their respective affiliates currently serve as key personnel, advisors, managers and sponsors or co-sponsors to some or all of 11 other real estate programs affiliated with our sponsor, including Griffin Capital Essential Asset REIT II, Inc. (“GCEAR II”) and Griffin-American Healthcare REIT III, Inc. (“GAHR III”), both of which are publicly-registered, non-traded real estate investment trusts, Griffin-American Healthcare REIT IV, Inc. (“GAHR IV”), a non-traded real estate investment trust in registration as of December 31, 2015, Griffin-Benefit Street Partners BDC Corp. (“GB-BDC”), a non-traded business development company regulated under the 1940 Act, and Griffin Institutional Access Real Estate Fund (“GIREX”), a non-diversified, closed-end management investment company that is operated as an interval fund under the 1940 Act. Because these persons have competing demands on their time and resources, they may have conflicts of interest in allocating their time between our business and these other activities. During times of intense activity in other programs and ventures, they may devote less time and fewer resources to our business than is necessary or appropriate. If this occurs, the returns on our stockholders’ investment may suffer.

Our officers and one of our directors face conflicts of interest related to the positions they hold with affiliated entities, which could hinder our ability to successfully implement our investment objectives and to generate returns to our stockholders.

Our executive officers and one of our directors are also officers of our sponsor, our Advisor, our property manager, and other affiliated entities. As a result, these individuals owe fiduciary duties to these other entities and their owners, which fiduciary duties may conflict with the duties that they owe to our stockholders and us. Their loyalties to these other entities could result in actions or inactions that are detrimental to our business, which could harm the implementation of our investment objectives. Conflicts with our business and interests are most likely to arise from involvement in activities related to (1) allocation of new investments and management time and services between us and the other entities, (2) our purchase of properties from, or sale of properties to, affiliated entities, (3) the timing and terms of the investment in or sale of an asset, (4) development of our properties by affiliates, (5) investments with affiliates of our Advisor, (6) compensation to our Advisor, and (7) our relationship with our property manager. If we do not successfully implement our investment objectives, we may be unable to generate cash needed to make distributions to our stockholders and to maintain or increase the value of our assets.

Our Advisor will face conflicts of interest relating to the purchase of properties, and such conflicts may not be resolved in our favor, which could adversely affect our investment opportunities.

We may be buying properties at the same time as one or more of the other programs currently managed by officers and key personnel of our Advisor. Our sponsor, Advisor and its affiliates are actively involved in 11 other affiliated real estate programs, including GCEAR II, GAHR III, and GAHR IV, tenant in common programs and other real estate programs and partnerships that may compete with us or otherwise have similar business interests. Our Advisor and our property manager will have conflicts of interest in allocating potential properties, acquisition expenses, management time, services and other functions between various existing enterprises or future enterprises with which they may be or become involved. There is a risk that our Advisor will choose a property that provides lower returns to us than a property purchased by another program sponsored by our sponsor. We cannot be sure that officers and key personnel acting on behalf of our Advisor and on behalf of these other programs will act in our best interests when deciding whether to allocate any particular property to us. Such conflicts that are not resolved in our favor could result in a reduced level of distributions we may be able to pay to our stockholders and a reduction in the value of our stockholders’ investment. If our Advisor or its affiliates breach their legal or other obligations or duties to us, or do not resolve conflicts of interest, we may not meet our investment objectives, which could reduce our expected cash available for distribution to our stockholders and the value of our stockholders’ investment.

We may face a conflict of interest when purchasing properties from affiliates of our Advisor.

As of December 31, 2015, we have acquired seven of our properties from certain affiliates of our sponsor, including our Chief Executive Officer and Chairman, Kevin A. Shields, our Executive Vice President, David C. Rupert and our Vice President - Acquisitions, Don Pescara, along with several third party investors. We may purchase properties from one or more affiliates of our Advisor in the future. A conflict of interest may exist in such an acquisition and affiliates of our Advisor may be entitled to fees on both sides of such a related party transaction. The business interests of our Advisor and its affiliates may be adverse to, or to the detriment of, our interests. Additionally, the prices we pay to affiliates of our Advisor for our properties may be equal to, or in excess of, the prices paid by them, plus the costs incurred by them relating to the acquisition and financing of the properties. These prices will not be the subject of arm’s-length negotiations, which could mean that the acquisitions may be on terms less favorable to us than those negotiated in an arm’s-length transaction. Even though we will use an independent third party appraiser to determine fair market value when acquiring properties from our Advisor and its affiliates, we may pay more for particular properties than we would have in an arm’s-length transaction, which would reduce our cash available for investment in other properties or distribution to our stockholders. Furthermore, because any agreement that we enter into with affiliates of our Advisor will not be negotiated in an arm’s-length transaction, and as a result of the affiliation between our Advisor and its affiliates, our Advisor may be reluctant to enforce the agreements against such entities.

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Our nominating and corporate governance committee of our board of directors will approve all transactions between us and our Advisor and its affiliates. See Part I, Item 1, Business - Affiliate Transaction Policy.

We may face conflicts of interest when disposing of certain of our properties, which may cause us to make payments to the affiliated contributors of such properties pursuant to tax protection agreements.

In connection with the contribution of seven of our properties from certain affiliates of our sponsor and several other third party investors, we have entered into tax protection agreements with the contributors. These agreements obligate our Operating Partnership to reimburse the contributors for tax liabilities resulting from their recognition of income or gain if we cause our Operating Partnership to take certain actions with respect to the various properties, the result of which causes income or gain to the contributors for a period subsequent to the contribution of such property as specified in the tax protection agreement. As a result, we may face conflicts of interest if affiliates of our Advisor and sponsor recommend that we sell one of these properties, the result of which could cause our Operating Partnership to provide reimbursements under the tax protection agreements if we do not reinvest the proceeds of the sale pursuant to Section 1031 of the Code or any other tax deferred investment.

Our Advisor will face conflicts of interest relating to the incentive distribution structure under our operating partnership agreement, which could result in actions that are not necessarily in the long-term best interests of our stockholders.

Our Advisor and its affiliates will perform services for us in connection with the selection, acquisition and management of our properties pursuant to our advisory agreement. In addition, our Advisor will be entitled to fees and distributions that are structured in a manner intended to provide incentives to our Advisor to perform in our best interests and in the best interests of our stockholders. The amount of such compensation has not been determined as a result of arm’s-length negotiations, and such amounts may be greater than otherwise would be payable to independent third parties. While certain affiliates of our sponsor, including our Chief Executive Officer and Chairman, our Executive Vice President and our Vice President - Acquisitions, have an equity interest in our Operating Partnership through the contribution of certain of our properties, our Advisor is entitled to receive substantial minimum compensation regardless of performance. Therefore, our Advisor’s interests may not be wholly aligned with those of our stockholders. In that regard, our Advisor could be motivated to recommend riskier or more speculative investments in order for us to generate the specified levels of performance or sales proceeds that would entitle our Advisor to greater fees. In addition, our Advisor’s entitlement to fees upon the sale of our assets and to participate in sale proceeds could result in our Advisor recommending sales of our investments at the earliest possible time at which sales of investments would produce the level of return that would entitle our Advisor to compensation relating to such sales, even if continued ownership of those investments might be in our best long-term interest.

Our operating partnership agreement will require us to pay a performance-based termination distribution to our Advisor in the event that we terminate our Advisor prior to the listing of our shares for trading on an exchange or, absent such listing, in respect of its participation in net sale proceeds. To avoid paying this distribution, our independent directors may decide against terminating the advisory agreement prior to our listing of our shares or disposition of our investments even if, but for the termination distribution, termination of the advisory agreement would be in our best interest. In addition, the requirement to pay the distribution to our Advisor at termination could cause us to make different investment or disposition decisions than we would otherwise make in order to satisfy our obligation to pay the distribution to the terminated Advisor.

At the time it becomes necessary for our board of directors to determine which liquidity event, if any, is in the best interests of us and our stockholders, our Advisor may not agree with the decision of our board as to which liquidity event, if any, we should pursue if there is a substantial difference in the amount of subordinated distributions the Advisor may receive for each liquidity event. Our Advisor may prefer a liquidity event with higher subordinated distributions. If our board of directors decides to list our shares for trading on an exchange, our board may also decide to merge us with our Advisor in anticipation of the listing process. Such merger may result in substantial compensation to the Advisor which may create certain conflicts of interest.

Our Advisor will face conflicts of interest relating to joint ventures that we may form with affiliates of our Advisor, which conflicts could result in a disproportionate benefit to other joint venture partners at our expense.

We may enter into joint ventures with other programs sponsored by our sponsor, including other REITs, for the acquisition, development or improvement of properties. Our Advisor may have conflicts of interest in determining which program sponsored by our sponsor should enter into any particular joint venture agreement. The co-venturer may have economic or business interests or goals that are or may become inconsistent with our business interests or goals. In addition, our Advisor may face a conflict in structuring the terms of the relationship between our interests and the interest of the affiliated co-venturer and in managing the joint venture. Since our Advisor and its affiliates will control both the affiliated co-venturer, and, to a certain extent, us, agreements and transactions between the co-venturers with respect to any such joint venture will not have the benefit of arm’s-length negotiation of the type normally conducted between unrelated co-venturers, which may result in the co-venturer receiving benefits greater than the benefits that we receive. In addition, we may assume liabilities related to

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the joint venture that exceed the percentage of our investment in the joint venture, and this could reduce the returns on our stockholders investment.

There is no separate counsel for us and our affiliates, which could result in conflicts of interest.

Nelson Mullins Riley & Scarborough LLP ("Nelson Mullins") acts as legal counsel to us and also represents our sponsor, our Advisor, and some of their affiliates. There is a possibility in the future that the interests of the various parties may become adverse and, under the code of professional responsibility of the legal profession, Nelson Mullins may be precluded from representing any one or all of such parties. If any situation arises in which our interests appear to be in conflict with those of our Advisor or its affiliates, additional counsel may be retained by one or more of the parties to assure that their interests are adequately protected. Moreover, should a conflict of interest not be readily apparent, Nelson Mullins may inadvertently act in derogation of the interest of the parties which could affect our ability to meet our investment objectives.

Risks Related to Our Corporate Structure

The limit on the number of shares a person may own may discourage a takeover that could otherwise result in a premium price to our stockholders.

In order for us to qualify as a REIT, no more than 50% of our outstanding stock may be beneficially owned, directly or indirectly, by five or fewer individuals (including certain types of entities) at any time during the last half of each taxable year. To ensure that we do not fail to qualify as a REIT under this test, our charter restricts ownership by one person or entity to no more than 9.8% in value or number, whichever is more restrictive, of any class of our outstanding stock. This restriction may have the effect of delaying, deferring or preventing a change in control of us, including an extraordinary transaction (such as a merger, tender offer or sale of all or substantially all of our assets) that might provide a premium price for holders of our common stock.

Our charter permits our board of directors to issue stock with terms that may subordinate the rights of common stockholders or discourage a third party from acquiring us in a manner that might result in a premium price to our stockholders.

Our charter permits our board of directors to issue up to 900,000,000 shares of capital stock. In addition, our board of directors, without any action by our stockholders, may amend our charter from time to time to increase or decrease the aggregate number of shares or the number of shares of any class or series of stock that we have authority to issue. Our board of directors may classify or reclassify any unissued common stock or preferred stock and establish the preferences, conversion or other rights, voting powers, restrictions, limitations as to distributions, qualifications and terms or conditions of redemption of any such stock. Thus, our board of directors could authorize the issuance of preferred stock with terms and conditions that could have a priority as to distributions and amounts payable upon liquidation over the rights of the holders of our common stock. Preferred stock could also have the effect of delaying, deferring or preventing a change in control of us, including an extraordinary transaction (such as a merger, tender offer or sale of all or substantially all of our assets) that might otherwise provide a premium price for holders of our common stock. In addition, our board can authorize the issuance of preferred units under our Operating Partnership which may have similar preferential rights as preferred stock. There is no limit on the amount of preferred units our Operating Partnership could issue.

We are not afforded the protection of Maryland law relating to business combinations.

Under Maryland law, “business combinations” between a Maryland corporation and an interested stockholder or an affiliate of an interested stockholder are prohibited for five years after the most recent date on which the interested stockholder becomes an interested stockholder. These business combinations include a merger, consolidation, share exchange, or, in circumstances specified in the statute, an asset transfer or issuance or reclassification of equity securities. An interested stockholder is defined as:

• any person who beneficially owns 10% or more of the voting power of the corporation’s shares; or

• an affiliate or associate of the corporation who, at any time within the two-year period prior to the date in question, was the beneficial owner of 10% or more of the voting power of the then outstanding voting stock of the corporation.

These prohibitions are intended to prevent a change of control by interested stockholders who do not have the support of our board of directors. Since our charter contains limitations on ownership of 9.8% or more of our common stock, we opted out of the business combinations statute in our charter. Therefore, we will not be afforded the protections of this statute and, accordingly, there is no guarantee that the ownership limitations in our charter would provide the same measure of protection as the business combinations statute and prevent an undesired change of control by an interested stockholder.

Our stockholders’ investment return may be reduced if we are required to register as an investment company under the Investment Company Act of 1940. If we become an unregistered investment company, we will not be able to continue our business.

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We do not intend to register as an investment company under the 1940 Act. As of December 31, 2015, we owned 74 properties, and our intended investments in real estate will represent the substantial majority of our total asset mix, which would not subject us to registration under the 1940 Act. In order to maintain an exemption from regulation under the 1940 Act, we must engage primarily in the business of buying real estate. If we are unable to remain fully invested in real estate holdings, we may avoid being required to register as an investment company by temporarily investing any unused proceeds in government securities with low returns, which would reduce the cash available for distribution to investors and possibly lower our stockholders’ returns.

To maintain compliance with our 1940 Act exemption, we may be unable to sell assets we would otherwise want to sell and may need to sell assets we would otherwise wish to retain. In addition, we may be required to acquire additional income- or loss-generating assets that we might not otherwise acquire or forgo opportunities to acquire interests in companies that we would otherwise want to acquire. If we are required to register as an investment company but fail to do so, we would be prohibited from engaging in our business, and criminal and civil actions could be brought against us. In addition, our contracts would be unenforceable unless a court required enforcement, and a court could appoint a receiver to take control of us and liquidate our business.

Our stockholders are bound by the majority vote on matters on which our stockholders are entitled to vote and, therefore, a stockholder’s vote on a particular matter may be superseded by the vote of other stockholders.

Stockholders may vote on certain matters at any annual or special meeting of stockholders, including the election of directors. However, stockholders will be bound by the majority vote on matters requiring approval of a majority of the stockholders even if they do not vote with the majority on any such matter.

If stockholders do not agree with the decisions of our board of directors, they only have limited control over changes in our policies and operations and may not be able to change such policies and operations, except as provided for in our charter and under applicable law.

Our board of directors determines our major policies, including our policies regarding investments, operations, capitalization, financing, growth, REIT qualification and distributions. Our board of directors may amend or revise these and other policies without a vote of our stockholders. Under the Maryland General Corporation Law and our charter, our stockholders have a right to vote only on the following:

• the election or removal of directors;

• any amendment of our charter, except that our board of directors may amend our charter without stockholder approval to increase or decrease the aggregate number of our shares, to increase or decrease the number of our shares of any class or series that we have the authority to issue, or to classify or reclassify any unissued shares by setting or changing the preferences, conversion or other rights, restrictions, limitations as to distributions, qualifications or terms and conditions of redemption of such shares, provided however, that any such amendment does not adversely affect the rights, preferences and privileges of the stockholders;

• our liquidation or dissolution; and

• any merger, consolidation or sale or other disposition of substantially all of our assets.

All other matters are subject to the discretion of our board of directors. Therefore, our stockholders are limited in their ability to change our policies and operations.

Our rights and the rights of our stockholders to recover claims against our officers, directors and our Advisor are limited, which could reduce our stockholders’ and our recovery against them if they cause us to incur losses.

Maryland law provides that a director has no liability in that capacity if he or she performs his or her duties in good faith, in a manner he or she reasonably believes to be in the corporation’s best interests and with the care that an ordinarily prudent person in a like position would use under similar circumstances. Our charter, in the case of our directors, officers, employees and agents, and the advisory agreement, in the case of our Advisor, requires us to indemnify our directors, officers, employees and agents and our Advisor and its affiliates for actions taken by them in good faith and without negligence or misconduct. Additionally, our charter limits the liability of our directors and officers for monetary damages to the maximum extent permitted under Maryland law. As a result, we and our stockholders may have more limited rights against our directors, officers, employees and agents, and our Advisor and its affiliates, than might otherwise exist under common law, which could reduce our stockholders’ and our recovery against them. In addition, we may be obligated to fund the defense costs incurred by our directors, officers, employees and agents of our Advisor in some cases which would decrease the cash otherwise available for distribution to our stockholders.

Our stockholders’ interest in us will be diluted as we issue additional shares.

Our stockholders will not have preemptive rights to any shares issued by us in the future. Subject to any limitations set forth under Maryland law, our board of directors may increase the number of authorized shares of stock (currently 900,000,000

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shares), increase or decrease the number of shares of any class or series of stock designated, or reclassify any unissued shares without the necessity of obtaining stockholder approval. All of such shares may be issued in the discretion of our board of directors. Therefore, as we (1) sell additional shares in the future, including those issued pursuant to our DRP Offering, (2) sell securities that are convertible into shares of our common stock, (3) issue shares of our common stock in a private offering of securities to institutional investors, (4) issue shares of restricted common stock or stock options to our independent directors, (5) issue shares to our Advisor, its successors or assigns, in payment of an outstanding payment obligation as set forth under our operating partnership agreement, (6) issue shares of our common stock to sellers of properties acquired by us in connection with an exchange of limited partnership interests of our Operating Partnership, or (7) issue preferred units, existing stockholders and investors purchasing shares in our DRP Offering will experience dilution of their equity investment in us. Because the limited partnership interests of our Operating Partnership may, in the discretion of our board of directors, be exchanged for shares of our common stock, any merger, exchange or conversion between our Operating Partnership and another entity ultimately could result in the issuance of a substantial number of shares of our common stock, thereby diluting the percentage ownership interest of other stockholders. As of December 31, 2015, we had 175,184,519 shares of common stock issued and outstanding, and we owned approximately 97% of the limited partnership units of the Operating Partnership. Our sponsor and certain of its affiliates owned approximately 1% of the limited partnership units of the Operating Partnership, and the remaining approximately 2% of the limited partnership units were owned by third parties. Because of these and other reasons described in this “Risk Factors” section, stockholders should not expect to be able to own a significant percentage of our shares.

In addition, the net book value per share of our common stock was approximately $7.86 as of December 31, 2015 as compared to our offering price per share pursuant to our DRP Offering of $10.40. Therefore, upon a purchase of our shares in the DRP Offering, stockholders will be immediately diluted based on the net book value. Net book value takes into account a deduction of commissions and/or expenses paid by us, and is calculated to include depreciated tangible assets, deferred financing costs, and amortized intangible assets, which include in-place market leases. Net book value is not an estimate of net asset value, or of the market value or other value of our common stock.

Payment of substantial fees and expenses to our Advisor and its affiliates will reduce cash available for investment and distribution.

Our Advisor and its affiliates will perform services for us in connection with the selection and acquisition of our investments, and the management of our properties. They will be paid substantial fees for these services, which will reduce the amount of cash available for investment in properties or distribution to stockholders.

We are uncertain of our sources of debt or equity for funding our future capital needs. If we cannot obtain funding on acceptable terms, our ability to make necessary capital improvements to our properties may be impaired or delayed.

To qualify as a REIT, we generally must distribute to our stockholders at least 90% of our taxable income each year, excluding capital gains. Because of this distribution requirement, it is not likely that we will be able to fund a significant portion of our future capital needs from retained earnings. We have not identified all sources of debt or equity for future funding, and such sources of funding may not be available to us on favorable terms or at all. If, however, we do not have access to sufficient funding in the future, we may not be able to make necessary capital improvements to our properties, pay other expenses or expand our business.

Risks Related to Investments in Single Tenant Real Estate

Many of our properties will depend upon a single tenant for all or a majority of their rental income, and our financial condition and ability to make distributions may be adversely affected by the bankruptcy or insolvency, a downturn in the business, or a lease termination of a single tenant, including those caused by the current economic downturn.

We expect that many of our properties will be occupied by only one tenant or will derive a majority of their rental income from one tenant and, therefore, the success of those properties will be materially dependent on the financial stability of such tenants. A tenant at one or more of our properties may be negatively affected by an economic slowdown. Lease payment defaults by tenants, including those caused by an economic downturn, could cause us to reduce the amount of distributions we pay. A default of a tenant on its lease payments to us and the potential resulting vacancy would cause us to lose the revenue from the property and force us to find an alternative source of revenue to meet any mortgage payment and prevent a foreclosure if the property is subject to a mortgage. In the event of a default, we may experience delays in enforcing our rights as landlord and may incur substantial costs in protecting our investment and re-letting the property. If a lease is terminated or an existing tenant elects not to renew a lease upon its expiration, there is no assurance that we will be able to lease the property for the rent previously received or sell the property without incurring a loss. A default by a tenant, the failure of a guarantor to fulfill its obligations or other premature termination of a lease, or a tenant’s election not to extend a lease upon its expiration, could have an adverse effect on our financial condition and our ability to pay distributions.

A significant portion of our leases are due to expire around the same period of time, which may (i) cause a loss in the value of our stockholders’ investment until the affected properties are re-leased, (ii) increase our exposure to downturns in

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the real estate market during the time that we are trying to re-lease such space and (iii) increase our capital expenditure requirements during the releasing period.

Our tenant leases are set to expire as shown below (dollars in thousands):

Year of Lease Expiration	Annualized Net Rent (unaudited)(1)		Number of Lessees	Square Feet	Percentage of Annualized Net Rent
2016	$	903	3	91,700	0.4	%
2017	9,642		6	560,900	4.2	%
2018	24,017		11	2,507,800	10.4	%
2019	27,187		9	1,556,900	11.8	%
2020	19,503		10	1,668,000	8.5	%
2021	11,196		7	1,106,500	4.9	%
2022	15,513		9	1,315,300	6.8	%
2023	17,641		7	1,278,200	7.7	%
2024	27,022		12	2,980,700	11.8	%
2025	20,313		8	1,479,700	8.8	%
2026	14,299		5	851,000	6.2	%
2027	7,565		3	359,800	3.3	%
2028	2,376		1	231,400	1.0	%
2029	6,472		1	249,400	2.8	%
2030	12,858		2	1,931,400	5.6	%
2035	13,335		1	459,800	5.8	%
Total	$	229,842	95	18,628,500	100.0	%

(1) Net rent is based on (a) the contractual base rental payments assuming the lease requires the tenant to reimburse us for certain operating expenses or the property is self-managed by the tenant and the tenant is responsible for all, or substantially all, of the operating expenses; or (b) contractual rent payments less certain operating expenses that are our responsibility for the 12-month period subsequent to December 31, 2015 and includes assumptions that may not be indicative of the actual future performance of a property, including the assumption that the tenant will perform its obligations under its lease agreement during the next 12 months.

We may experience similar concentrations of lease expiration dates in the future. As the expiration date of a lease for a single-tenant building approaches, the value of the property generally declines because of the risk that the building may not be re-leased upon expiration of the existing lease or may be re-leased on terms less favorable than those of the expiring leases. Therefore, if we were to list or liquidate our portfolio prior to the favorable re-leasing of the space, our stockholders may suffer a loss on their investment. Our stockholders may also suffer a loss (and a reduction in distributions) after the expiration of the lease terms if we are not able to re-lease such space on terms similar to or more favorable than the terms of the expiring lease. These expiring leases, therefore, increase our risk to real estate downturns during and approaching these periods of concentrated lease expirations. In addition, we may have to spend significant capital in order to ready the space for new tenants. To meet our need for cash at this time, we may have to increase borrowings or reduce our distributions, or both.

If a tenant declares bankruptcy, we may be unable to collect balances due under relevant leases.

Any of our tenants, or any guarantor of a tenant’s lease obligations, could be subject to a bankruptcy proceeding pursuant to Title 11 of the bankruptcy laws of the United States. Such a bankruptcy filing would bar all efforts by us to collect pre-bankruptcy debts from these entities or their properties, unless we receive an enabling order from the bankruptcy court. Post-bankruptcy debts would be paid currently. If a lease is assumed, all pre-bankruptcy balances owing under it must be paid in full. If a lease is rejected by a tenant in bankruptcy, we would have a general unsecured claim for damages. If a lease is rejected, it is unlikely we would receive any payments from the tenant because our claim is capped at the rent reserved under the lease, without acceleration, for the greater of one year or 15% of the remaining term of the lease, but not greater than three years, plus rent already due but unpaid. This claim could be paid only in the event funds were available, and then only in the same percentage as that realized on other unsecured claims.

A tenant or lease guarantor bankruptcy could delay efforts to collect past due balances under the relevant leases, and could ultimately preclude full collection of these sums. Such an event could cause a decrease or cessation of rental payments that would mean a reduction in our cash flow and the amount available for distributions to our stockholders. In the event of a bankruptcy, we cannot assure our stockholders that the tenant or its trustee will assume our lease. If a given lease, or guaranty of a lease, is not assumed, our cash flow and the amounts available for distributions to our stockholders may be adversely affected.

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Net leases may not result in fair market lease rates over time.

We expect a large portion of our rental income to come from net leases. Net leases are typically characterized by (1) longer lease terms; (2) fixed rental rate increases during the primary term of the lease; and (3) fixed rental rates for initial renewal options, and, thus, there is an increased risk that these contractual lease terms will fail to result in fair market rental rates. As a result, our income and distributions to our stockholders could be lower than they would otherwise be if we did not engage in net leases.

Our real estate investments may include special-use single tenant properties that may be difficult to sell or re-lease upon tenant defaults or early lease terminations.

We have investments in commercial and industrial properties, which may include manufacturing facilities and special-use single tenant properties. These types of properties are relatively illiquid compared to other types of real estate and financial assets. This illiquidity will limit our ability to quickly change our portfolio in response to changes in economic or other conditions. With these properties, if the current lease is terminated or not renewed or, in the case of a mortgage loan, if we take such property in foreclosure, we may be required to renovate the property or to make rent concessions in order to lease the property to another tenant or sell the property. In addition, in the event we are forced to sell the property, we may have difficulty selling it to a party other than the tenant or borrower due to the special purpose for which the property may have been designed. These and other limitations may affect our ability to sell or re-lease properties and adversely affect returns to our stockholders.

A high concentration of our properties in a particular geographic area, or that have tenants in a similar industry, would magnify the effects of downturns in that geographic area or industry.

In the event that we have a concentration of properties in any particular geographic area, any adverse situation that disproportionately affects that geographic area would have a magnified adverse effect on our portfolio. Similarly, if our tenants are concentrated in a certain industry or industries, any adverse effect to that industry generally would have a disproportionately adverse effect on our portfolio. As of December 31, 2015, approximately 15.5% and 13.7% of our total rental income, based on the 12-month period subsequent to December 31, 2015, was concentrated in the states of California and Texas, respectively. Additionally, as of December 31, 2015, approximately 26.7%, 23.1%, and 19.6% of our total rental income, based on the 12-month period subsequent to December 31, 2015, was concentrated in the manufacturing, finance and insurance, and information industries, respectively.

If a sale-leaseback transaction is recharacterized in a tenant’s bankruptcy proceeding, our financial condition could be adversely affected.

We may enter into sale-leaseback transactions, whereby we would purchase a property and then lease the same property back to the person from whom we purchased it. In the event of the bankruptcy of a tenant, a transaction structured as a sale-leaseback may be recharacterized as either a financing or a joint venture, either of which outcomes could adversely affect our business. If the sale-leaseback were recharacterized as a financing, we might not be considered the owner of the property, and as a result would have the status of a creditor in relation to the tenant. In that event, we would no longer have the right to sell or encumber our ownership interest in the property. Instead, we would have a claim against the tenant for the amounts owed under the lease, with the claim arguably secured by the property. The tenant/debtor might have the ability to propose a plan restructuring the term, interest rate and amortization schedule of its outstanding balance. If confirmed by the bankruptcy court, we could be bound by the new terms, and prevented from foreclosing our lien on the property. If the sale-leaseback were recharacterized as a joint venture, our lessee and we could be treated as co-venturers with regard to the property. As a result, we could be held liable, under some circumstances, for debts incurred by the lessee relating to the property. Either of these outcomes could adversely affect our cash flow and the amount available for distributions to our stockholders.

General Risks Related to Investments in Real Estate

Our operating results will be affected by economic and regulatory changes that have an adverse impact on the real estate market in general, and we cannot assure our stockholders that we will be profitable or that we will realize growth in the value of our real estate properties.

Our operating results will be subject to risks generally incident to the ownership of real estate, including:

• changes in general economic or local conditions;

• changes in supply of or demand for similar or competing properties in an area;

• changes in interest rates and availability of permanent mortgage funds that may render the sale of a property difficult or unattractive;

• changes in tax, real estate, environmental and zoning laws;

• changes in property tax assessments and insurance costs; and

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• increases in interest rates and tight debt and equity supply.

These and other reasons may prevent us from being profitable or from realizing growth or maintaining the value of our real estate properties.

We may obtain only limited warranties when we purchase a property.

The seller of a property will often sell such property in its “as is” condition on a “where is” basis and “with all faults,” without any warranties of merchantability or fitness for a particular use or purpose. In addition, purchase agreements may contain only limited warranties, representations and indemnifications that will only survive for a limited period after the closing. Also, certain sellers of real estate are single purpose entities without significant other assets. The purchase of properties with limited warranties or from undercapitalized sellers increases the risk that we may lose some or all of our invested capital in the property as well as the loss of rental income from that property.

Our inability to sell a property when we desire to do so could adversely impact our ability to pay cash distributions to our stockholders.

The real estate market is affected by many factors, such as general economic conditions, availability of financing, interest rates and other factors, including supply and demand, that are beyond our control. We cannot predict whether we will be able to sell any property for the price or on the terms set by us, or whether any price or other terms offered by a prospective purchaser would be acceptable to us. We cannot predict the length of time needed to find a willing purchaser and to close the sale of a property. Real estate generally cannot be sold quickly. Also, the tax laws applicable to REITs require that we hold our properties for investment, rather than for sale in the ordinary course of business, which may cause us to forgo or defer sales of properties that otherwise would be in our best interest. Therefore, we may not be able to dispose of properties promptly, or on favorable terms, in response to economic or other market conditions, and this may adversely impact our ability to make distributions to our stockholders.

In addition, we may be required to expend funds to correct defects or to make improvements before a property can be sold. We cannot assure our stockholders that we will have funds available to correct such defects or to make such improvements.

In acquiring a property, we may agree to restrictions that prohibit the sale of that property for a period of time or impose other restrictions, such as a limitation on the amount of debt that can be placed or repaid on that property. These provisions would also restrict our ability to sell a property.

We may not be able to sell our properties at a price equal to, or greater than, the price for which we purchased such properties, which may lead to a decrease in the value of our assets.

We may be purchasing our properties at a time when cap rates are at historically low levels and purchase prices are high. Therefore, the value of our properties may not increase over time, which may restrict our ability to sell our properties, or in the event we are able to sell such property, may lead to a sale price less than the price that we paid to purchase the properties.

We may acquire or finance properties with lock-out provisions, which may prohibit us from selling a property, or may require us to maintain specified debt levels for a period of years on some properties.

Lock-out provisions are provisions that generally prohibit repayment of a loan balance for a certain number of years following the origination date of a loan. Such provisions are typically provided for by the Code or the terms of the agreement underlying a loan. Lock-out provisions could materially restrict us from selling or otherwise disposing of or refinancing properties. These provisions would affect our ability to turn our investments into cash and thus affect cash available for distribution to our stockholders. Lock-out provisions may prohibit us from reducing the outstanding indebtedness with respect to any properties, refinancing such indebtedness on a non-recourse basis at maturity, or increasing the amount of indebtedness with respect to such properties.

Lock-out provisions could impair our ability to take actions during the lock-out period that would otherwise be in our stockholders’ best interests and, therefore, may have an adverse impact on the value of the shares, relative to the value that would result if the lock-out provisions did not exist. In particular, lock-out provisions could preclude us from participating in major transactions that could result in a disposition of our assets or a change in control even though that disposition or change in control might be in our stockholders’ best interests.

Adverse economic conditions may negatively affect our returns and profitability.

The following market and economic challenges may adversely affect our operating results:

• poor economic times may result in customer defaults under leases or bankruptcy;

• re-leasing may require reduced rental rates under the new leases; and

• increased insurance premiums, resulting in part from the increased risk of terrorism and natural disasters, may reduce funds available for distribution.

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We are susceptible to the effects of adverse macro-economic events that can result in higher unemployment, shrinking demand for products, large-scale business failures and tight credit markets. Because our portfolio consists of single-tenant commercial and industrial properties, we are subject to risks inherent in investments in a single tenant properties in which we rely on the payment of rent from an individual tenant, and our results of operations are sensitive to changes in overall economic conditions that impact the tenant's business and on-going cash flow that can cause the tenant to cease making rental payments. A continuation of, or slow recovery from, ongoing adverse domestic and foreign economic conditions, such as employment levels, business conditions, interest rates, tax rates, fuel and energy costs, could continue to negatively impact a tenant's business resulting in insufficient cash flow to continue as a going-concern and ultimately the vacating of the occupied property. Such circumstances will have a direct impact on our cash flow from operations and cause us to incur costs, such as on-going maintenance during vacancy and leasing costs, that could have an impact to continue the payment of distributions to our shareholders.

Since we cannot predict when real estate markets may recover, the value of the properties we acquire may decline if market conditions persist or worsen. Further, the results of operations for a property in any one period may not be indicative of results in future periods, and the long-term performance of such property generally may not be comparable to, and cash flows may not be as predictable as, other properties owned by third parties in the same or similar industry.

If we suffer losses that are not covered by insurance or that are in excess of insurance coverage, we could lose invested capital and anticipated profits.

Material losses may occur in excess of insurance proceeds with respect to any property, as insurance may not be sufficient to fund the losses. However, there are types of losses, generally of a catastrophic nature, such as losses due to wars, acts of terrorism, earthquakes, floods, hurricanes, pollution or environmental matters, which are either uninsurable or not economically insurable, or may be insured subject to limitations, such as large deductibles or co-payments. In addition, we may decide not to obtain any or adequate earthquake or similar catastrophic insurance coverage because the premiums are too high even in instances where it may otherwise be available. Insurance risks associated with potential terrorism acts could sharply increase the premiums we pay for coverage against property and casualty claims. Additionally, mortgage lenders in some cases have begun to insist that commercial property owners purchase specific coverage against terrorism as a condition for providing mortgage loans. It is uncertain whether such insurance policies will be available, or available at reasonable cost, which could inhibit our ability to finance or refinance our potential properties. In these instances, we may be required to provide other financial support, either through financial assurances or self-insurance, to cover potential losses. We cannot assure our stockholders that will have adequate coverage for such losses. The Terrorism Risk Insurance Act of 2002 is designed for a sharing of terrorism losses between insurance companies and the federal government. We cannot be certain how this act will impact us or what additional cost to us, if any, could result. If such an event damaged or destroyed one or more of our properties, we could lose both our invested capital and anticipated profits from such property.

Delays in the acquisition, development and construction of properties may have adverse effects on our results of operations and returns to our stockholders.

Delays we encounter in the selection, acquisition and development of real properties could adversely affect our stockholders’ returns. Investments in unimproved real property, properties that are in need of redevelopment, or properties that are under development or construction will be subject to the uncertainties associated with the development and construction of real property, including those related to re-zoning land for development, environmental concerns of governmental entities and/or community groups and our builders’ ability to build in conformity with plans, specifications, budgets and timetables. If a builder fails to perform, we may resort to legal action to rescind the purchase or the construction contract or to compel performance. A builder’s performance may also be affected or delayed by conditions beyond the builder’s control.

Where properties are acquired prior to the start of construction or during the early stages of construction, it will typically take several months to complete construction and lease available space. Therefore, our stockholders could suffer delays in the receipt of cash distributions attributable to those particular real properties. We may incur additional risks when we make periodic progress payments or other advances to builders before they complete construction. These and other factors can result in increased costs of a project or loss of our investment. We also must rely on rental income and expense projections and estimates of the fair market value of a property upon completion of construction when agreeing upon a purchase price at the time we acquire the property. If our projections are inaccurate, we may pay too much for a property, and the return on our investment could suffer.

Costs of complying with governmental laws and regulations, including those relating to environmental matters, may adversely affect our income and the cash available for distribution.

All real property we acquire, and the operations conducted on real property are subject to federal, state and local laws and regulations relating to environmental protection and human health, safety and fire. These laws and regulations generally govern wastewater discharges, air emissions, the operation and removal of underground and above-ground storage tanks, the use, storage, treatment, transportation and disposal of solid and hazardous materials, and the remediation of contamination

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associated with disposals. Some of these laws and regulations may impose joint and several liability on tenants, owners or operators for the costs to investigate or remediate contaminated properties, regardless of fault or whether the acts causing the contamination were legal. This liability could be substantial. In addition, the presence of hazardous substances, or the failure to properly remediate these substances, may adversely affect our ability to sell, rent or pledge such property as collateral for future borrowings.

Some of these laws and regulations have been amended so as to require compliance with new or more stringent standards as of future dates. Compliance with new or more stringent laws or regulations or stricter interpretation of existing laws may require us to incur material expenditures. Future laws, ordinances or regulations may impose material environmental liability. Additionally, our tenants’ operations, the existing condition of land when we buy it, operations in the vicinity of our properties, such as the presence of underground storage tanks, or activities of unrelated third parties may affect our properties. Any material expenditures, fines, or damages we must pay will reduce our ability to make distributions to our stockholders and may reduce the value of our stockholders’ investment.

Further, we may not obtain an independent third party environmental assessment for every property we acquire. In addition, we cannot assure our stockholders that any such assessment that we do obtain will reveal all environmental liabilities or that a prior owner of a property did not create a material environmental condition not known to us. We cannot predict what other environmental legislation or regulations will be enacted in the future, how existing or future laws or regulations will be administered or interpreted, or what environmental conditions may be found to exist in the future. We cannot assure our stockholders that our business, assets, results of operations, liquidity or financial condition will not be adversely affected by these laws, which may adversely affect cash available for distribution, and the amount of distributions to our stockholders.

Our costs associated with complying with the Americans with Disabilities Act may affect cash available for distribution.

Our properties will be subject to the Americans with Disabilities Act of 1990, or ADA. Under the ADA, all places of public accommodation are required to comply with federal requirements related to access and use by disabled persons. The ADA has separate compliance requirements for “public accommodations” and “commercial facilities” that generally require that buildings and services, including restaurants and retail stores, be made accessible and available to people with disabilities. The ADA’s requirements could require removal of access barriers and could result in the imposition of injunctive relief, monetary penalties, or, in some cases, an award of damages. We will attempt to acquire properties that comply with the ADA or place the burden on the seller or other third party to ensure compliance with the ADA. However, we cannot assure our stockholders that we will be able to acquire properties or allocate responsibilities in this manner. If we cannot, our funds used for ADA compliance may affect cash available for distribution and the amount of distributions to our stockholders.

If we sell properties by providing financing to purchasers, defaults by the purchasers would adversely affect our cash flows.

In some instances we may sell our properties by providing financing to purchasers. When we provide financing to purchasers, we will bear the risk that the purchaser may default, which could negatively impact our cash distributions to stockholders. Even in the absence of a purchaser default, the distribution of the proceeds of sales to our stockholders, or their reinvestment in other assets, will be delayed until the promissory notes or other property we may accept upon the sale are actually paid, sold, refinanced or otherwise disposed of. In some cases, we may receive initial down payments in cash and other property in the year of sale in an amount less than the selling price and subsequent payments will be spread over a number of years.

We will be subject to risks associated with the co-owners in our co-ownership arrangements that otherwise may not be present in other real estate investments.

We may enter into joint ventures or other co-ownership arrangements with respect to a portion of the properties we acquire. Ownership of co-ownership interests involves risks generally not otherwise present with an investment in real estate such as the following:

• the risk that a co-owner may at any time have economic or business interests or goals that are or become inconsistent with our business interests or goals;

• the risk that a co-owner may be in a position to take action contrary to our instructions or requests or contrary to our policies or objectives;

• the possibility that an individual co-owner might become insolvent or bankrupt, or otherwise default under the applicable mortgage loan financing documents, which may constitute an event of default under all of the applicable mortgage loan financing documents or allow the bankruptcy court to reject the tenants-in-common agreement or management agreement entered into by the co-owner owning interests in the property;

• the possibility that a co-owner might not have adequate liquid assets to make cash advances that may be required in order to fund operations, maintenance and other expenses related to the property, which could result in the loss

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of current or prospective tenants and may otherwise adversely affect the operation and maintenance of the property, and could cause a default under the mortgage loan financing documents applicable to the property and may result in late charges, penalties and interest, and may lead to the exercise of foreclosure and other remedies by the lender;

• the risk that a co-owner could breach agreements related to the property, which may cause a default under, or result in personal liability for, the applicable mortgage loan financing documents, violate applicable securities laws and otherwise adversely affect the property and the co-ownership arrangement; or

• the risk that a default by any co-owner would constitute a default under the applicable mortgage loan financing documents that could result in a foreclosure and the loss of all or a substantial portion of the investment made by the co-owner.

Any of the above might subject a property to liabilities in excess of those contemplated and thus reduce the amount available for distribution to our stockholders.

In the event that our interests become adverse to those of the other co-owners, we may not have the contractual right to purchase the co-ownership interests from the other co-owners. Even if we are given the opportunity to purchase such co-ownership interests in the future, we cannot guarantee that we will have sufficient funds available at the time to purchase co-ownership interests from the co-owners.

We might want to sell our co-ownership interests in a given property at a time when the other co-owners in such property do not desire to sell their interests. Therefore, we may not be able to sell our interest in a property at the time we would like to sell. In addition, we anticipate that it will be much more difficult to find a willing buyer for our co-ownership interests in a property than it would be to find a buyer for a property we owned outright.

Risks Associated with Debt Financing

If we breach covenants under our unsecured credit agreement with KeyBank, National Association ("KeyBank") and other syndication partners, or our loan agreements with certain other lenders, we could be held in default under such loans, which could accelerate our repayment date and materially adversely affect the value of our stockholders’ investment in us.

We entered into an unsecured credit facility with KeyBank and a syndicate of lenders partners under which we were provided with a $1.14 billion senior unsecured credit facility consisting of a $500.0 million senior unsecured revolver and a $640.0 million senior unsecured term loan.

The credit facility requires that we must maintain a pool of real properties, which is subject to the following requirements: (i) no less than 30 unencumbered asset pool properties at all times; (ii) no greater than 15% of the unencumbered asset pool value may be contributed by any single unencumbered asset pool property; (iii) no greater than 15% of the aggregate unencumbered asset pool value may be contributed by unencumbered asset pool properties subject to ground leases; (iv) no greater than 15% of the aggregate unencumbered asset pool value may be contributed by unencumbered asset pool properties that are under development; (v) a minimum weighted average occupancy of all unencumbered asset pool properties be no less than 90%; (vi) minimum weighted average remaining lease term for all unencumbered properties shall be no less than five years; and (vii) other limitations as determined by KeyBank upon further diligence of the unencumbered asset pool properties. Upon the occurrence of certain events described further in the KeyBank credit facility agreement, KeyBank may require the borrower to grant a first perfected mortgage/deed of trust lien on each of the unencumbered asset pool properties.

The credit facility includes a number of financial covenant requirements, including, but not limited to, a maximum consolidated leverage ratio (60% or, for a maximum of two consecutive quarters following a material acquisition, 65%), a minimum fixed charge ratio (1.5 to 1), a maximum secured debt ratio (40%), a maximum secured recourse debt ratio (5%), a maximum unhedged variable rate debt (30%), and minimum tangible net worth of at least approximately $1.2 billion plus 75% of the net proceeds of any common or preferred share issuance after the effective date and 75% of the amount of units of limited partnership interest in our Operating Partnership issued in connection with the contribution of properties, a maximum payout ratio of 95% of distribution to core funds from operations, minimum unsecured interest coverage ratio (2 to 1).

If we were to default under the KeyBank credit facility agreement, the lenders could accelerate the date for our repayment of the loan, and could sue to enforce the terms of the loan. In addition, upon the occurrence of certain events described further in the KeyBank credit facility agreement, the lenders may have the ability to place a first mortgage on certain of the properties in the unencumbered asset pool, and could ultimately foreclose on such properties. Such foreclosure could result in a material loss for us and would adversely affect the value of our stockholders’ investment in us.

We have broad authority to incur debt, and high debt levels could hinder our ability to make distributions and could decrease the value of our stockholders’ investment.

Although, technically, our board may approve unlimited levels of debt, our charter generally limits us to incurring debt no greater than 300% of our net assets before deducting depreciation or other non-cash reserves (equivalent to 75% leverage),

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unless any excess borrowing is approved by a majority of our independent directors and disclosed to our stockholders in our next quarterly report, along with a justification for such excess borrowing. High debt levels would cause us to incur higher interest charges, would result in higher debt service payments, and could be accompanied by restrictive covenants. These factors could limit the amount of cash we have available to distribute and could result in a decline in the value of our stockholders’ investment.

We have incurred, and intend to continue to incur, mortgage indebtedness and other borrowings, which may increase our business risks.

We have placed, and intend to continue to place, permanent financing on our properties or obtain a credit facility or other similar financing arrangement in order to acquire properties. We may also decide to later further leverage our properties. We may incur mortgage debt and pledge all or some of our real properties as security for that debt to obtain funds to acquire real properties. We may borrow if we need funds to pay a desired distribution rate to our stockholders. We may also borrow if we deem it necessary or advisable to assure that we maintain our qualification as a REIT for federal income tax purposes. If there is a shortfall between the cash flow from our properties and the cash flow needed to service mortgage debt, then the amount available for distribution to our stockholders may be reduced.

If we are unable to make our debt payments when required, a lender could foreclose on the property or properties securing such debt, which could reduce the amount of distributions we pay to our stockholders and decrease the value of our stockholders’ investment.

We may have a significant amount of acquisition indebtedness secured by first priority mortgages on our properties. In addition, some of our properties contain, and any future acquisitions we make may contain, mortgage financing. If we are unable to make our debt payments when required, a lender could foreclose on the property or properties securing such debt. In any such event, we could lose some or all of our investment in these properties, which would reduce the amount of distributions we pay to our stockholders and decrease the value of our stockholders’ investment.

Lenders may require us to enter into restrictive covenants relating to our operations, which could limit our ability to make distributions to our stockholders.

When providing financing, a lender could impose restrictions on us that affect our distribution and operating policies and our ability to incur additional debt. Loan documents we enter into may contain covenants that limit our ability to further mortgage the property, discontinue insurance coverage or replace our Advisor. These or other limitations may adversely affect our flexibility and limit our ability to make distributions to our stockholders.

Increases in interest rates would increase the amount of our debt payments and adversely affect our ability to make distributions to you.

We currently have outstanding debt payments which are indexed to variable interest rates. We may also incur additional debt or preferred equity in the future which rely on variable interest rates. Increases in these variable interest rates in the future would increase our interest costs, which would likely reduce our cash flows and our ability to make distributions to you. In addition, if we need to make payments on instruments which contain variable interest during periods of rising interest rates, we could be required to liquidate one or more of our investments in properties at times that may not permit realization of the maximum return on such investments.

Disruptions in the credit markets and real estate markets could have a material adverse effect on our results of operations, financial condition, and ability to pay distributions to our stockholders.

Future disruptions in domestic and international financial markets may severely impact the amount of credit available to us and may contribute to rising costs associated with obtaining or maintaining such credit. In such an instance, we may not be able to obtain new debt financing, or maintain our existing debt financing, on terms and conditions we find to be ideal. If disruptions in the credit markets occur and are ongoing, our ability to borrow monies to finance the purchase of, or other activities related to, real estate assets may be negatively impacted. In addition, if we pay fees to lock in a favorable interest rate, falling interest rates or other factors could require us to forfeit these fees. All of these events could have a material adverse effect on our results of operations, financial condition and ability to pay distributions.

In addition to volatility in the credit markets, the real estate market is subject to fluctuation and can be impacted by factors such as general economic conditions, supply and demand, availability of financing and interest rates. To the extent we purchase real estate in an unstable market, we are subject to the risk that if the real estate market ceases to attract the same level of capital investment in the future that it attracts at the time of our purchases, or the number of companies seeking to acquire properties decreases, the value of our investments may not appreciate or may decrease significantly below the amount we pay for these investments.

Federal Income Tax Risks

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Failure to qualify as a REIT would adversely affect our operations and our ability to make distributions, as we would incur additional tax liabilities.

We believe we operate in a manner that allows us to qualify as a REIT for U.S. federal income tax purposes under the Code. Qualification as a REIT involves highly technical and complex Code provisions for which there are only limited judicial and administrative interpretations. Our qualification as a REIT will depend upon our ability to meet, through investments, actual operating results, distributions and satisfaction of specific stockholder rules, the various tests imposed by the Code.

If we fail to qualify as a REIT for any taxable year, we will be subject to federal income tax and any applicable alternative minimum tax on our taxable income at regular corporate rates. In addition, we would generally be disqualified from treatment as a REIT for the four taxable years following the year of losing our REIT status. Losing our REIT status would reduce our net earnings available for investment or distribution to stockholders because of the additional tax liability. In addition, distributions to stockholders would no longer qualify for the distributions paid deduction, and we would no longer be required to make distributions. If this occurs, we might be required to borrow funds or liquidate some investments in order to pay the applicable tax.

To qualify as a REIT, and to avoid the payment of federal income and excise taxes and maintain our REIT status, we may be forced to borrow funds, use proceeds from the issuance of securities, or sell assets to pay distributions, which may result in our distributing amounts that may otherwise be used for our operations.

To obtain the favorable tax treatment accorded to REITs, we normally will be required each year to distribute to our stockholders at least 90% of our real estate investment trust taxable income, determined without regard to the deduction for distributions paid and by excluding net capital gains. We will be subject to federal income tax on our undistributed taxable income and net capital gain and to a 4% nondeductible excise tax on any amount by which distributions we pay with respect to any calendar year are less than the sum of (1) 85% of our ordinary income, (2) 95% of our capital gain net income, and (3) 100% of our undistributed income from prior years. These requirements could cause us to distribute amounts that otherwise would be spent on acquisitions of properties and it is possible that we might be required to borrow funds, use proceeds from the issuance of securities or sell assets in order to distribute enough of our taxable income to maintain our REIT status and to avoid the payment of federal income and excise taxes. These methods of obtaining funding could affect future distributions by increasing operating costs and decreasing available cash. In addition, such distributions may constitute a return of capital.

If our Operating Partnership fails to maintain its status as a partnership for federal income tax purposes, its income would be subject to taxation and our REIT status would be terminated.

If the IRS were to successfully challenge the status of our Operating Partnership as a partnership, it would be taxable as a corporation. In such event, this would reduce the amount of distributions that our Operating Partnership could make to us. This would also result in our losing REIT status and becoming subject to a corporate level tax on our own income. This would substantially reduce our cash available to pay distributions and the return on our stockholders’ investment. In addition, if any of the entities through which our Operating Partnership owns its properties, in whole or in part, loses its characterization as a partnership for federal income tax purposes, it would be subject to taxation as a corporation, thereby reducing distributions to our Operating Partnership. Such a recharacterization of our Operating Partnership or an underlying property owner could also threaten our ability to maintain REIT status.

Our stockholders may have tax liability on distributions they elect to reinvest in our common stock.

If stockholders participate in our distribution reinvestment plan, they will be deemed to have received, and for income tax purposes will be taxed on, the amount reinvested in common stock to the extent the amount reinvested was not a tax-free return of capital. As a result, unless stockholders are a tax-exempt entity, they may have to use funds from other sources to pay their tax liability on the value of the common stock received.

In certain circumstances, we may be subject to federal and state income taxes as a REIT, which would reduce our cash available for distribution to our stockholders.

Even if we qualify and maintain our status as a REIT, we may be subject to federal income taxes or state taxes. For example, net income from a “prohibited transaction” will be subject to a 100% tax. We may not be able to make sufficient distributions to avoid excise taxes applicable to REITs. We may also decide to retain income we earn from the sale or other disposition of our property and pay income tax directly on such income. In that event, our stockholders would be treated as if they earned that income and paid the tax on it directly. However, stockholders that are tax-exempt, such as charities or qualified pension plans, would have no benefit from their deemed payment of such tax liability. We may also be subject to state and local taxes on our income or property, either directly or at the level of the Operating Partnership or at the level of the other companies through which we indirectly own our assets. Any federal or state taxes we pay will reduce our cash available for distribution to our stockholders.

We may be required to pay some taxes due to actions of our taxable REIT subsidiary which would reduce our cash available for distribution to our stockholders.

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Any net taxable income earned directly by our taxable REIT subsidiaries, or through entities that are disregarded for federal income tax purposes, which are wholly-owned by our taxable REIT subsidiaries, will be subject to federal and possibly state corporate income tax. We filed an election to treat Griffin Capital Essential Asset TRS, Inc. as a taxable REIT subsidiary, and we may elect to treat other subsidiaries as taxable REIT subsidiaries in the future. In this regard, several provisions of the laws applicable to REITs and their subsidiaries ensure that a taxable REIT subsidiary will be subject to an appropriate level of federal income taxation. For example, a taxable REIT subsidiary is limited in its ability to deduct certain interest payments made to an affiliated REIT. In addition, the REIT has to pay a 100% penalty tax on some payments that it receives or on some deductions taken by a taxable REIT subsidiary if the economic arrangements between the REIT, the REIT’s customers, and the taxable REIT subsidiary are not comparable to similar arrangements between unrelated parties. Finally, some state and local jurisdictions may tax some of our income even though as a REIT we are not subject to federal income tax on that income because not all states and localities follow the federal income tax treatment of REITs. To the extent that we and our affiliates are required to pay federal, state and local taxes, we will have less cash available for distributions to our stockholders.

Distributions to tax-exempt investors may be classified as unrelated business taxable income.

Neither ordinary nor capital gain distributions with respect to our common stock nor gain from the sale of common stock should generally constitute unrelated business taxable income (UBTI) to a tax-exempt investor. However, there are certain exceptions to this rule. In particular:

• part of the income and gain recognized by certain qualified employee pension trusts with respect to our common stock may be treated as UBTI if shares of our common stock are predominately held by qualified employee pension trusts, and we are required to rely on a special look-through rule for purposes of meeting one of the REIT share ownership tests, and we are not operated in a manner to avoid treatment of such income or gain as UBTI;

• part of the income and gain recognized by a tax exempt investor with respect to our common stock would constitute UBTI if the investor incurs debt in order to acquire the common stock; and

• part or all of the income or gain recognized with respect to our common stock by social clubs, voluntary employee benefit associations, supplemental unemployment benefit trusts and qualified group legal services plans which are exempt from federal income taxation under Sections 501(c)(7), (c)(9), (c)(17) or (c)(20) of the Code may be treated as UBTI.

Complying with the REIT requirements may cause us to forgo otherwise attractive opportunities.

To qualify as a REIT for federal income tax purposes, we must continually satisfy tests concerning, among other things, the sources of our income, the nature and diversification of our assets, the amounts we distribute to our stockholders and the ownership of shares of our common stock. We may be required to make distributions to stockholders at disadvantageous times or when we do not have funds readily available for distribution, or we may be required to liquidate otherwise attractive investments in order to comply with the REIT tests. Thus, compliance with the REIT requirements may hinder our ability to operate solely on the basis of maximizing profits.

Legislative or regulatory action could adversely affect investors.

On January 3, 2013, President Obama signed into law the American Taxpayer Relief Act of 2012, extending the existing 15% qualified dividend rate for 2013 and subsequent taxable years for those individuals with incomes below certain thresholds. For those with income above such thresholds, the qualified dividend rate is 20%. These tax rates are generally not applicable to distributions paid by a REIT, unless such distributions represent earnings on which the REIT itself has been taxed. As a result, distributions (other than capital gain distributions) we pay to individual investors generally will be subject to the tax rates that are otherwise applicable to ordinary income for federal income tax purposes, which currently are as high as 39.6%. This disparity in tax treatment may make an investment in our shares comparatively less attractive to individual investors than an investment in the shares of non-REIT corporations, and could have an adverse effect on the value of our common stock. Stockholders are urged to consult with their own tax advisor with respect to the impact of recent legislation on their investment in our common stock and the status of legislative, regulatory or administrative developments and proposals and their potential effect on an investment in our common stock.

Foreign purchasers of our common stock may be subject to the Foreign Investment in Real Property Tax Act (“FIRPTA”) upon the sale of their shares.

A foreign person disposing of a U.S. real property interest, including shares of a U.S. corporation whose assets consist principally of U.S. real property interests, is generally subject to a tax, known as FIRPTA tax, on the gain recognized on the disposition. Such FIRPTA tax does not apply, however, to the disposition of stock in a REIT if the REIT is “domestically controlled.” A REIT is “domestically controlled” if less than 50% of the REIT’s stock, by value, has been owned directly or indirectly by persons who are not qualifying U.S. persons during a continuous five-year period ending on the date of disposition or, if shorter, during the entire period of the REIT’s existence.

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We cannot assure our stockholders that we will qualify as a “domestically controlled” REIT. If we were to fail to so qualify, gain realized by foreign investors on a sale of our shares would be subject to FIRPTA tax, unless our shares were traded on an established securities market and the foreign investor did not at any time during a specified testing period directly or indirectly own more than 5% of the value of our outstanding common stock.

Employee Retirement Income Security Act of 1974 (“ERISA”) Risks

There are special considerations that apply to employee benefit plans, IRAs or other tax-favored benefit accounts investing in our shares which could cause an investment in our shares to be a prohibited transaction which could result in additional tax consequences.

ERISA and the Code impose certain restrictions on (i) employee benefit plans (as defined in Section 3(3) of ERISA), (ii) plans described in Code Section 4975(e)(1), including IRAs and Keogh plans, (iii) any entities whose underlying assets include plan assets by reason of a plan’s investment in such entities, and (iv) persons who have certain specified relationships to such plans, i.e., parties-in-interest under ERISA and disqualified persons under the Code. If stockholders are investing the assets of such a plan or account in our common stock, they should satisfy themselves that, among other things:

• their investment is consistent with their fiduciary obligations under ERISA, the Code, or other applicable law;

• their investment is made in accordance with the documents and instruments governing their IRA, plan or other account, including any applicable investment policy;

• their investment satisfies the prudence and diversification requirements of ERISA or other applicable law;

• their investment will not impair the liquidity of the IRA, plan or other account;

• their investment will not produce UBTI for the IRA, plan or other account;

• they will be able to value the assets of the plan annually in accordance with the requirements of ERISA or other applicable law, to the extent applicable; and

• their investment will not constitute a prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or constitute a violation of analogous provisions under other applicable law, to the extent applicable.

Persons investing the assets of employee benefit plans, IRAs, and other tax-favored benefit accounts should consider ERISA and related risks of investing in our shares.

ERISA and Code Section 4975 prohibit certain transactions that involve a “party-in-interest” (under ERISA) or a “disqualified person” (under the Code) and any of the following: (i) employee benefit plans (as defined in Section 3(3) of ERISA), (ii) plans described in Code Section 4975(e)(1), including individual retirement accounts and Keogh plans, (iii) any entities whose underlying assets include plan assets by reason of a plan’s investment in such entities, and (iv) persons who have certain specified relationships to such plans, i.e., parties-in-interest under ERISA and disqualified persons under the Code. For example, based on the reasoning of the U.S. Supreme Court in John Hancock Life Ins. Co. v. Harris Trust and Savings Bank, 510 U.S. 86 (1993), an insurance company’s general account may be deemed to include assets of plans investing in the general account (e.g., through the purchase of an annuity contract), and the insurance company might be treated as a party-in-interest or disqualified person with respect to a plan by virtue of such investment. Consequently, the fiduciary of a plan or trustee or custodian of an account contemplating an investment in our shares should consider whether we, any other person associated with the issuance of the shares, or any of their affiliates is or might become a “party-in-interest” or “disqualified person” with respect to the IRA, plan or other account and, if so, whether an exception from such prohibited transaction rules is applicable.

In addition, the Department of Labor (DOL) plan asset regulations as modified by ERISA Section 3(42) provide that, subject to certain exceptions, the assets of an entity in which an IRA, plan or other account holds an equity interest may be treated as assets of an investing IRA, plan or other account, in which event the underlying assets of such entity (and transactions involving such assets) would be subject to the prohibited transaction provisions. Furthermore, if an employee benefit plan invests in our shares and we have significant participation by benefit plan investors (as defined in the DOL plan asset regulations), the standards of prudence and other provisions of ERISA could extend to us with respect to our investments and the trustee or other fiduciary of such plan may be deemed to have improperly delegated fiduciary responsibilities to us in violation of ERISA. We intend to take such steps as may be necessary to qualify us for one or more of the exceptions available, and thereby prevent our assets from being treated as assets of any investing IRA, plan or other account.

ITEM 1B. UNRESOLVED STAFF COMMENTS

Not Applicable.

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ITEM 2. PROPERTIES

As of December 31, 2015, we owned a fee simple interest in 74 properties, as shown in the table below, encompassing approximately 18.6 million rentable square feet (dollar amounts shown in thousands) and an 80% interest in an unconsolidated joint venture, as discussed in footnote 6 below:

Property	Location	Tenant/Major Lessee	Acquisition Date	Purchase Price		Approx. Square Feet	% Leased by Major Lessee(1)	% Leased	Property Type	Year of Lease Expiration (for Major Lessee)	Annualized Net Rent (2) (Unaudited)
Renfro	Clinton, SC	Renfro Corp	6/18/2009	$	21,700	566,500	100%	100%	Manufacturing/ Distribution	2021	$	2,078
Plainfield	Plainfield, IL	Chicago Bridge & Iron Company (Delaware)	6/18/2009	32,660		176,000	100%	100%	Office/Laboratory	2022	2,681
Emporia Partners	Emporia, KS	Hopkins Enterprises, Inc.	8/27/2010	8,360		320,800	100%	100%	Manufacturing/ Distribution	2020	949
ITT	Los Angeles, CA	ITT Educational Services, Inc.	9/23/2010	7,800		35,800	100%	100%	Office	2022	573
Quad/Graphics	Loveland, CO	World Color (USA), LLC	12/30/2010	11,850		169,800	100%	100%	Printing Facility/ Office	2022	1,216
AT&T	Redmond, WA	AT&T Services, Inc.	1/31/2012	40,000		155,800	100%	100%	Office/ Data Center	2019	3,311
Westinghouse	Cranberry Township, PA	Westinghouse Electric Company, LLC	3/22/2012	36,200		118,000	100%	100%	Engineering Facility	2025	3,005
TransDigm	Whippany, NJ	Whippany Actuation Systems, LLC	5/31/2012	13,000		114,300	100%	100%	Assembly/ Manufacturing	2018	1,189
Travelers	Greenwood Village, CO	Travelers Indemnity	6/29/2012	16,100		131,000	100%	100%	Office	2024	1,428
Zeller Plastik	Libertyville, IL	Zeller Plastik USA, Inc.	11/8/2012	15,600		193,700	100%	100%	Manufacturing	2022	1,339
Northrop Grumman	Beavercreek (Dayton), OH	Northrop Grumman Systems Corp.	11/13/2012	17,000		99,200	100%	100%	Office	2019	1,510
Health Net	Rancho Cordova, CA	Health Net of California, Inc.	12/18/2012	22,650		145,900	100%	100%	Office	2022	2,219
Comcast	Greenwood Village, CO	Comcast Cable Holdings, LLC	1/11/2013	27,000		157,300	100%	100%	Office	2021	2,416
Boeing	Renton, WA	The Boeing Company	2/15/2013	12,000		70,100	100%	100%	Office	2017	1,046
Schlumberger	Houston, TX	Schlumberger Technology Corporation	5/1/2013	48,750		149,700	100%	100%	Office	2024	3,163
UTC	Charlotte, NC	United Technologies Corporation ("UTC")	5/3/2013	39,188		198,900	100%	100%	Office	2025	2,677
Avnet	Chandler, AZ	Avnet, Inc.	5/29/2013	32,462		231,400	100%	100%	Research & Development/Flex Facility	2028	2,376

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Property	Location	Tenant/Major Lessee	Acquisition Date	Purchase Price	Approx. Square Feet	% Leased by Major Lessee(1)	% Leased	Property Type	Year of Lease Expiration (for Major Lessee)	Annualized Net Rent (2) (Unaudited)
Cigna	Phoenix, AZ	Connecticut General Life Insurance Company	6/20/2013	54,500	232,600	100%	100%	Office	2023	3,788
Nokia	Arlington Heights, IL	Nokia Solutions & Networks	8/13/2013	29,540	214,200	100%	100%	Office	2025	2,292
Verizon	Warren, NJ	Cellco Partnership d/b/a Verizon Wireless	10/3/2013	40,000	210,500	100%	100%	Office	2020	3,544
Fox Head	Irvine, CA	Fox Head, Inc.	10/29/2013	27,250	81,600	100%	100%	Office	2027	1,898
Coca-Cola Refreshments	Atlanta, GA	Coca-Cola Refreshments USA	11/5/2013	56,700	315,900	98%	100%	Office	2018	4,996
Atlanta Wildwood	Atlanta, GA	Hyundai Capital USA/BlueLinx	11/5/2013	28,000	250,000	60%	100%	Office	2019	3,306
General Electric (3)	Atlanta, GA	General Electric Company	11/5/2013	61,000	265,100	100%	100%	Office	2025	4,434
Community Insurance	Mason, OH	Community Insurance Company	11/5/2013	23,500	223,500	100%	100%	Office	2019	2,523
Anthem	Mason, OH	Anthem Prescription Management	11/5/2013	9,500	78,200	100%	100%	Office	2019	939
JPMorgan Chase	Westerville, OH	JPMorgan Chase	11/5/2013	44,500	388,700	100%	100%	Office	2025	3,209
IBM	Dublin, OH	IBM	11/5/2013	37,300	322,700	88%	100%	Office	2020	4,263
Aetna	Arlington, TX	Aetna Life Insurance Company	11/5/2013	16,000	139,400	87%	98%	Office	2020	1,501
CHRISTUS Health	Irving, TX	CHRISTUS Health	11/5/2013	46,350	253,300	98%	100%	Office	2024	3,470
Roush Industries	Allen Park, MI	Roush Industries	11/5/2013	12,250	169,200	100%	100%	Office	2020	1,377
Wells Fargo	Milwaukee, WI	Molina Healthcare of Wisconsin, Inc.	11/5/2013	26,000	229,600	54%	67%	Office	2022	438
One Century Place	Nashville, TN	Willis North America	11/5/2013	70,000	538,800	33%	99%	Office	2026	6,730
Shire Pharmaceuticals	Wayne, PA	Shire Pharmaceuticals, Inc.	11/5/2013	21,500	114,100	100%	100%	Office	2017	2,366
Comcast (Northpointe Corporate Center I)	Lynwood, WA	Comcast Corporation	11/5/2013	19,825	87,400	100%	100%	Office	2017	1,838
Northpointe Corporate Center II	Lynwood, WA	Intermec Technologies Corporation	11/5/2013	7,175	70,400	100%	100%	Office	2024	1,136
United HealthCare	St. Louis, MO	United HealthCare Services	11/5/2013	28,000	188,500	100%	100%	Office	2018	2,866

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Property	Location	Tenant/Major Lessee	Acquisition Date	Purchase Price	Approx. Square Feet	% Leased by Major Lessee(1)	% Leased	Property Type	Year of Lease Expiration (for Major Lessee)	Annualized Net Rent (2) (Unaudited)
Farmers (3)	Kansas City, KS	Farmers Insurance Exchange	12/27/2013	19,100	102,000	100%	100%	Office	2024	1,454
Caterpillar	Joliet, IL	Caterpillar, Inc.	1/7/2014	57,000	1,380,100	100%	100%	Industrial	2018	6,119
DigitalGlobe	Westminster, CO	DigitalGlobe, Inc.	1/14/2014	92,000	430,000	100%	100%	Office	2030	6,420
Waste Management (4)	Phoenix, AZ	Waste Management of AZ	1/16/2014	22,825	131,800	100%	100%	Office	2023	1,829
BT Infonet	El Segundo, CA	Infonet Services Corporation	2/27/2014	52,669	157,000	100%	100%	Office	2021	4,275
Wyndham Worldwide	Parsippany, NJ	Wyndham Worldwide Operations, Inc.	4/23/2014	96,600	249,400	100%	100%	Office	2029	6,472
Ace Hardware	Oak Brook, IL	Ace Hardware Corporate HQ	4/24/2014	37,000	206,000	100%	100%	Office	2024	2,833
Equifax I	St. Louis, MO	Equifax, Inc.	5/20/2014	14,200	94,000	100%	100%	Office	2023	1,175
American Express	Phoenix, AZ	American Express Travel Related Services Co.	5/22/2014	51,000	337,400	100%	100%	Office	2019	3,865
SoftBank	San Carlos, CA	SoftBank Regional HQ	5/28/2014	90,100	207,900	50%	100%	Office	2020	6,869
Vanguard	Charlotte, NC	The Vanguard Group, Inc.	6/19/2014	33,200	224,600	100%	100%	Office	2024	2,483
Parallon	Largo (Tampa Bay), FL	Parallon Business Performance Group	6/25/2014	17,235	83,200	100%	100%	Office	2025	1,216
Level 3 (5)	Lone Tree, CO	Level 3 Communications, Inc.	8/1/2014	43,000	166,700	100%	100%	Office	2024	2,985
Equifax II	Earth City, MO	Equifax, Inc.	10/1/2014	13,916	99,300	100%	100%	Office	2024	1,110
Mason I	Mason, OH	Community Insurance Company	11/7/2014	22,500	213,000	100%	100%	Office	2026	1,573
Wells Fargo	Charlotte, NC	Wells Fargo Bank, N.A.	12/15/2014	41,486	155,600	100%	100%	Office	2025	2,703
GE Aviation	West Chester, OH	General Electric Company	2/19/2015	66,000	409,800	100%	100%	Office	2020	4,928
Westgate III	Houston, TX	Wood Group Mustang, Inc.	4/1/2015	77,000	225,500	100%	100%	Office	2026	4,912
Lisle	Lisle, IL	McCain Foods USA, Inc.	6/10/2015	19,500	94,400	100%	100%	Office	2021	1,481
Bloomingdale	Bloomingdale, IL	BFS Retail & Commercial Operations, LLC	6/10/2015	7,450	71,100	98%	98%	Office	2018	1,296
Columbia	Columbia, MD	Leidos Holdings, Inc.	6/10/2015	58,130	200,600	84%	85%	Office	2019	4,413

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Property	Location	Tenant/Major Lessee	Acquisition Date	Purchase Price		Approx. Square Feet	% Leased by Major Lessee(1)	% Leased	Property Type	Year of Lease Expiration (for Major Lessee)	Annualized Net Rent (2) (Unaudited)
Denver	Denver, CO	Jackson National Life Insurance Company	6/10/2015	35,000		182,900	97%	97%	Office	2027	3,861
Columbus	Dublin, OH	Qwest Communications Company, LLC	6/10/2015	27,600		164,600	100%	100%	Office	2022	2,288
Miramar	Miramar, FL	Humana Medical Plan, Inc.	6/10/2015	24,600		96,400	100%	100%	Office	2023	1,878
Irving Carpenter	Irving, TX	NEC Corporation of America	6/10/2015	23,500		119,600	100%	100%	Office	2026	1,293
Frisco	Frisco, TX	T-Mobile West Corporation	6/10/2015	59,250		284,200	90%	97%	Office	2017	4,314
Houston Westway II	Houston, TX	VetcoGray, Inc. (GE Oil & Gas, Inc.)	6/10/2015	82,500		242,400	77%	100%	Office	2022	5,663
Houston Westway I	Houston, TX	Cameron Solutions, Inc.	6/10/2015	37,700		144,000	89%	100%	Office	2018	2,781
Atlanta Perimeter	Atlanta, GA	State Farm Mutual Automobile Insurance Company	6/10/2015	101,670		584,800	86%	90%	Office	2023	7,137
Herndon	Herndon, VA	Time Warner Cable, Inc.	6/10/2015	87,300		268,200	100%	100%	Office	2019	7,028
Deerfield	Deerfield, IL	CF Industries Holdings, Inc.	6/10/2015	42,900		171,900	55%	100%	Office	2027	2,771
DreamWorks	Glendale, CA	DreamWorks Animation SKG, Inc.	7/21/2015	215,000		459,800	100%	100%	Office	2035	13,335
Restoration Hardware	Patterson, CA	Restoration Hardware, Inc.	8/15/2015	99,850		1,501,400	100%	100%	Industrial	2030	6,438
Highway 94	Jefferson City, MO	ABB, Inc.	11/6/2015	31,940		660,000	100%	100%	Industrial	2024	2,310
DynCorp	Fort Worth, TX	DynCorp International, LLC	12/11/2015	16,650		119,000	100%	100%	Office	2018	1,526
Mercedes-Benz	Fort Worth, TX	Mercedes-Benz Financial Services USA LLC	12/11/2015	29,000		164,300	100%	100%	Office	2018	2,902
Samsonite	Jacksonville, FL	Samsonite, LLC	12/11/2015	48,000		817,700	100%	100%	Industrial	2024	3,816
Total real estate portfolio				$	2,955,581	18,628,500					$	229,842
Investment in unconsolidated joint venture (6)	Ashburn, VA	A social media company and a financial services company	9/9/2014	148,400		132,300	73%	100%	Data Center	2020	14,242
Total				$	3,103,981	18,760,800					$	244,084

(1) The portfolio is approximately 99.5% occupied and leased.

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(2) Net rent is based on (a) the contractual base rental payments assuming the lease requires the tenant to reimburse us for certain operating expenses or the property is self-managed by the tenant and the tenant is responsible for all, or substantially all, of the operating expenses; or (b) contractual rent payments less certain operating expenses that are our responsibility for the 12-month period subsequent to December 31, 2015 and includes assumptions that may not be indicative of the actual future performance of a property, including the assumption that the tenant will perform its obligations under its lease agreement during the next 12 months.

(3) In connection with the acquisition of the General Electric and Farmers properties, we were assigned and assumed a leasehold estate and the rights to a payment in lieu of taxes agreement (the "PILOT Program") with the municipalities which own the underlying leased fee estate and subsequently leased the ground to us. The ground lease arrangements were put in place to provide real estate tax abatements, which is facilitated through the issuance of a municipal bond. Payments on the bonds, which are owned by us as lessee, are funded solely from the payments on the ground leases. The bonds can only be transferred to any successor to us, or any affiliate, as a lessee under the lease, including but not limited to any purchaser of our leasehold interest. Upon termination of the lease, we have the obligation to purchase the land for a nominal amount. The bonds, ground lease obligations, and purchase options were measured at fair value at acquisition in accordance with ASC 805, and due to their inseparability, are presented as a component of land on the consolidated balance sheets.

(4) The land associated with the property is subject to a ground lease with the State of Arizona expiring on December 31, 2095.

(5) In October 2014, Level 3 Communications, Inc. announced its acquisition of tw telecom holdings, inc. The property name has been updated to represent the surviving company, Level 3, as noted above.

(6) We acquired an 80% ownership interest in a joint venture with affiliates of Digital Realty Trust, L.P. for an initial investment of $68.4 million. The table above reflects the impact of our 80% ownership interest in the acquisition value, and net rental revenue, on our portfolio. See Note 4, Investments, to the consolidated financial statements.

Revenue Concentration

No lessee or property, based on annualized net rent for the 12-month period subsequent to December 31, 2015, pursuant to the respective in-place leases, was greater than 6% as of December 31, 2015.

The percentage of annualized net rent for the 12-month period subsequent to December 31, 2015, by state, based on the respective in-place leases, is as follows (dollars in thousands):

State	Annualized Net Rent (unaudited)		Number of Properties	Percentage of Annualized Net Rent
California	$	35,608	7	15.5	%
Texas	31,524		10	13.7	%
Ohio	21,232		8	9.2	%
Illinois	20,811		8	9.1	%
Georgia	19,875		4	8.6	%
Colorado	18,326		6	8.0	%
Arizona	11,858		4	5.2	%
All others (1)	70,608		27	30.7	%
Total	$	229,842	74	100.0	%

(1) All others account for less than 5% of total annualized net rent on an individual basis.

The percentage of annualized net rent for the 12-month period subsequent to December 31, 2015, by industry, based on the respective in-place leases, is as follows (dollars in thousands):

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Industry (1)	Annualized Net Rent (unaudited)		Number of Lessees	Percentage of Annualized Net Rent
Manufacturing	$	61,344	26	26.7	%
Finance & Insurance	53,155		27	23.1	%
Information (2)	45,162		11	19.6	%
Professional, Scientific and Technical Services (3)	26,455		8	11.5	%
Retail Trade	12,636		5	5.5	%
All others (4)	31,090		18	13.6	%
Total	$	229,842	95	100.0	%

(1) Industry classification based on the 2012 North American Industry Classification System.

(2) Includes Telecommunications.

(3) Includes, but is not limited to: Scientific Research and Development Services; Architectural, Engineering, and Related Services; and Legal Services.

(4) All others accounts for less than 5% of total annualized net rent on an individual basis.

The tenant lease expirations, by year, based on annualized net rent for the 12-month period subsequent to December 31, 2015 are as follows (dollars in thousands):

Year of Lease Expiration	Annualized Net Rent (unaudited)		Number of Lessees	Approx. Square Feet	Percentage of Annualized Net Rent
2016	$	903	3	91,700	0.4	%
2017	9,642		6	560,900	4.2	%
2018	24,017		11	2,507,800	10.4	%
2019	27,187		9	1,556,900	11.8	%
2020	19,503		10	1,668,000	8.5	%
2021	11,196		7	1,106,500	4.9	%
2022	15,513		9	1,315,300	6.8	%
2023	17,641		7	1,278,200	7.7	%
2024	27,022		12	2,980,700	11.8	%
2025	20,313		8	1,479,700	8.8	%
2026	14,299		5	851,000	6.2	%
2027	7,565		3	359,800	3.3	%
2028	2,376		1	231,400	1.0	%
2029	6,472		1	249,400	2.8	%
2030	12,858		2	1,931,400	5.6	%
2035	13,335		1	459,800	5.8	%
Total	$	229,842	95	18,628,500	100.0	%

Acquisition Indebtedness

For a discussion of our acquisitions and indebtedness, see Note 3, Real Estate, and Note 5, Debt, to the consolidated financial statements.

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ITEM 3. LEGAL PROCEEDINGS

(a) From time to time, we may become subject to legal proceedings, claims and litigation arising in the ordinary course of our business. We are not a party to any material legal proceedings, nor are we aware of any pending or threatened litigation that would have a material adverse effect on our business, operating results, cash flows or financial condition should such litigation be resolved unfavorably.

(b) None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

As of March 4, 2016, we had approximately $1.4 billion in shares of common stock outstanding, including $118.9 million in shares issued pursuant to our distribution reinvestment plan, held by a total of 39,947 stockholders of record. There is no established trading market for our common stock. Therefore, there is a risk that a stockholder may not be able to sell our stock at a time or price acceptable to the stockholder, or at all. Pursuant to the terms of our charter, certain restrictions are imposed on the ownership and transfer of shares.

Unless and until our shares are listed on a national securities exchange, it is not expected that a public market for our shares will develop. To assist fiduciaries of Plans (as defined below) subject to the annual reporting requirements of ERISA and Account (as defined below) trustees or custodians to prepare reports relating to an investment in our shares, we intend to provide reports in annual determinations of the current value of our net assets per outstanding share to those fiduciaries (including Account trustees and custodians) who identify themselves to us and request the reports.

For purposes of the preceding paragraphs, “Plans” include tax-qualified pension, stock bonus or profit-sharing plans, employee benefit plans described in Section 3(3) of ERISA, and annuities described in Section 403(a) or (b) of the Code, and “Accounts” include an individual retirement account or annuity described in Sections 408 or 408A of the Code (also known as IRAs), an Archer MSA described in Section 220(d) of the Code, a health savings account described in Section 223(d) of the Code, and a Coverdell education savings account described in Section 530 of the Code. We are currently selling shares of our common stock to the public pursuant to the DRP Offerings at a price of $10.40 per share. Our board of directors established this share price following its receipt of a third-party report from an advisor to the board of directors that contained a range of potential values of our common stock, which report was received in conjunction with determining the NAV as of September 30, 2015.

In accordance with applicable FINRA rules, we are required to provide the estimated value of our shares in our annual report each year. On October 22, 2015, our board of directors approved an estimated value per share of our common stock of $10.40 per share, based on the estimated value of our assets less the estimated value of our liabilities, or net asset value, divided by the number of shares outstanding on a fully diluted basis (the "NAV"), calculated as of September 30, 2015. The current share price does not represent a liquidation value of our assets and liabilities or the amount at which our shares of common stock would trade on a national securities exchange.

Determination of Estimated Value Per Share

On October 22, 2015, our board of directors, at the recommendation of our nominating and corporate governance committee of our board comprised solely of independent directors, approved an estimated value per share of our common stock of $10.40 based on the estimated value of our assets less the estimated value of our liabilities, or net asset value, divided by the number of shares outstanding on a fully diluted basis (the "NAV"), calculated as of September 30, 2015. We are providing this estimated value per share to assist broker dealers in connection with their obligations under applicable Financial Industry Regulatory Authority ("FINRA") rules with respect to customer account statements. This valuation was performed in accordance with the provisions of Practice Guideline 2013-01, Valuations of Publicly Registered Non-Listed REITs, issued by the IPA in April 2013 ("IPA Valuation Guidelines"), in addition to guidance from the SEC. 

Our nominating and corporate governance committee is responsible for the oversight of the valuation process, including the review and approval of the valuation process and methodology used to determine our estimated value per share, the consistency of the valuation and appraisal methodologies with real estate industry standards and practices, and the reasonableness of the assumptions used in the valuations and appraisals. The estimated value per share was determined after consultation with the Advisor and Robert A. Stanger & Co, Inc. ("Stanger"), an independent third-party valuation firm. The

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engagement of Stanger was approved by our nominating and corporate governance committee. Stanger prepared an appraisal report (the "Appraisal Report"), summarizing key inputs and assumptions, on 68 of the 70 properties in our portfolio (including an ownership interest in a joint venture which owns a data center facility in Ashburn, Virginia), in addition to one joint venture development in Patterson, California that is scheduled to be wholly acquired upon construction completion, and an office asset in Nashville, Tennessee, which we own a partial interest through a membership interest in a Delaware Statutory Trust (the "Appraised Properties"), as of June 30, 2015. Stanger also prepared a net asset value report (the "NAV Report") which estimates the net asset value per share of our common stock as of September 30, 2015. The NAV Report relied upon the Appraisal Report for the Appraised Properties, the acquisition price on three additional properties located in Westchester, Ohio; Houston, Texas; and Glendale, California which were all acquired within nine months of January 1, 2015, Stanger's estimated value of our mortgage loans and other debt, Stanger's value opinion with respect to our unconsolidated entity interests, Stanger's estimate of the Advisor's subordinated share of net proceeds due upon liquidation of our portfolio, and the Advisor's estimate of the value of our other assets and liabilities, to calculate an estimated net asset value per share of our common stock.

Upon our board of directors receipt and review of the Appraisal Report and the NAV Report (the "Reports"), the recommendation of the nominating and corporate governance committee, and the recommendation of the Advisor, our board of directors approved $10.40 as the estimated value per share of our common stock as of September 30, 2015, which determinations are ultimately and solely the responsibility of our board of directors.

The table below sets forth the calculation of our estimated value per share as of September 30, 2015. Certain amounts are reflected net of non-controlling interests, as applicable (dollars in thousands, except share and per share data):

	Estimated Value Per Share as of September 30, 2015
	Gross			Per Share
ASSETS:
Rental Properties, net	$	3,193,895		$	17.77
Cash and Cash Equivalents	28,223			0.16
Restricted Cash	41,476			0.23
Investment in Unconsolidated Entities	72,982			0.41
Other Assets	16,135			0.09
Total Assets	3,352,711			18.66
LIABILITIES:
Mortgage Payable	$	(328,487	)	$	(1.83	)
Line of Credit	(640,000		)	(3.56		)
KeyBank Term Loan	(353,225		)	(1.97		)
Total Debt	(1,321,712		)	(7.36		)
Restricted Reserves	(10,568		)	(0.06		)
Due to Affiliates	(2,951		)	(0.02		)
Distributions Payable	(6,275		)	(0.03		)
Accounts payable and Other Liabilities	(76,558		)	(0.43		)
Total Liabilities	(1,418,064		)	(7.89		)
Preferred Equity Subject to Redemption	(63,631		)	(0.35		)
Stockholders' Equity	1,871,016			10.41
Less: Promote	(2,527		)	(0.01		)
Stockholders' Equity, Net of Promote	$	1,868,489		$	10.40
Fully Diluted Shares Outstanding (1)	179,690,000			179,690,000

(1) Approximate number of shares outstanding on a fully diluted basis.

The table below sets forth the calculation of our prior estimated value per share as of December 31, 2012, as conducted by another independent third-party valuation firm. Stanger is not responsible for the determination of the estimated value per share as of December 31, 2012 (dollars in thousands, except share and per share data):

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	Prior Estimated Value Per Share as of December 31, 2012
Gross Real Estate Asset Value		$362,800
Current Assets, net	3,031
Mortgage Debt	(199,809)
Net Asset Value	166,022
Fully Diluted Shares Outstanding as of 12/31/2012	17,358,507
Net Asset Value Per Share Approved by our board of directors (1)		$9.56

(1) The estimated value range of our real estate assets and range of estimated value per share included a low end, mid-point, and high end. Our board of directors utilized the low end of the estimated value per share range to finalize their conclusion of the primary offering price. For more information related to the December 31, 2012 estimated value per share and the assumptions and methodologies used, see our Current Report on Form 8-K filed with the SEC on February 15, 2013.

Methodology and Key Assumptions

In determining an estimated value per share, our board of directors considered the Reports provided by Stanger and information provided by the Advisor. Our goal in calculating an estimated value per share is to arrive at a value that is reasonable and supportable using what our board of directors deems to be appropriate valuation methodologies and assumptions. 

FINRA's current rules provide no guidance on the methodology an issuer must use to determine its estimated value per share. As with any valuation methodology, the methodologies used are based upon a number of estimates and assumptions that may not be accurate or complete. Different parties with different assumptions and estimates could derive a different estimated value per share, and these differences could be significant. The estimated value per share is not audited and does not represent the fair value of our assets less our liabilities according to GAAP, nor does it represent a liquidation value of our assets and liabilities or the amount our shares of common stock would trade at on a national securities exchange. The estimated value per share does not reflect a discount for the fact that we are externally managed, nor does it reflect a real estate portfolio premium/discount versus the sum of the individual property values. The estimated value per share also does not take into account estimated disposition costs and fees for real estate properties that are not held for sale.

Independent Valuation Firm

Stanger was selected by the nominating and corporate governance committee to appraise the 68 Appraised Properties (including an ownership interest in a joint venture which owns a data center facility in Ashburn, Virginia), in addition to one joint venture development in Patterson, California that is scheduled to be wholly acquired upon construction completion and an office asset in Nashville, Tennessee which we own a partial interest through a membership interest in a Delaware Statutory Trust. Stanger is engaged in the business of appraising commercial real estate properties and is not affiliated with us or our Advisor. The compensation we paid to Stanger was based on the scope of work and not on the appraised values of our real estate properties. The appraisals were performed in accordance with the Code of Ethics and the Uniform Standards of Professional Appraisal Practice, or USPAP, the real estate appraisal industry standards created by The Appraisal Foundation. The Appraisal Report was reviewed, approved, and signed by an individual with the professional designation of MAI licensed in the state where each real property is located. The use of the reports is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. In preparing its Reports, Stanger did not, and was not requested to, solicit third-party indications of interest for our common stock in connection with possible purchases thereof or the acquisition of all or any part of our business.

Stanger collected reasonably available material information that it deemed relevant in appraising our real estate properties. Stanger relied in part on property-level information provided by the Advisor, including (i) property historical and projected operating revenues and expenses; (ii) property lease agreements and/or lease abstracts; and (iii) information regarding recent or planned capital expenditures.

In conducting their investigation and analyses, Stanger took into account customary and accepted financial and commercial procedures and considerations as they deemed relevant. Although Stanger reviewed information supplied or otherwise made available by us or our Advisor for reasonableness, they assumed and relied upon the accuracy and completeness of all such information and of all information supplied or otherwise made available to them by any other party and did not independently verify any such information. Stanger has assumed that any operating or financial forecasts and other information and data provided to or otherwise reviewed by or discussed with Stanger were reasonably prepared in good faith on bases reflecting the best currently available estimates and judgments of our management, the Board, and/or the Advisor. Stanger relied on us to advise them promptly if any information previously provided became inaccurate or was required to be updated during the period of their review. 

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In performing its analyses, Stanger made numerous other assumptions as of various points in time with respect to industry performance, general business, economic, and regulatory conditions, and other matters, many of which are beyond their control and our control. Stanger also made assumptions with respect to certain factual matters. For example, unless specifically informed to the contrary, Stanger assumed that we had clear and marketable title to each real estate property appraised, that no title defects exist, that any improvements were made in accordance with law, that no hazardous materials are present or were present previously, that no significant deed restrictions exist, and that no changes to zoning ordinances or regulations governing use, density, or shape are pending or being considered. Furthermore, Stanger's analyses, opinions, and conclusions were necessarily based upon market, economic, financial, and other circumstances and conditions existing as of or prior to the date of the Appraisal Report, and any material change in such circumstances and conditions may affect Stanger's analyses and conclusions. Stanger's Appraisal Report contains other assumptions, qualifications, and limitations that qualify the analyses, opinions, and conclusions set forth therein. Furthermore, the prices at which our real estate properties may actually be sold could differ from Stanger's analyses.

Stanger is actively engaged in the business of appraising commercial real estate properties similar to those owned by us in connection with public security offerings, private placements, business combinations, and similar transactions. We do not believe that there are any material conflicts of interest between Stanger, on the one hand, and us, our Advisor, and our affiliates, on the other hand. The nominating and corporate governance committee elected to engage Stanger to deliver their Reports to assist in the net asset value calculation due to its extensive knowledge of our portfolio. Stanger received usual and customary compensation for its efforts to deliver their Reports to us. In addition, we agreed to indemnify Stanger against certain liabilities arising out of this engagement. In the two years prior to the date of this filing, Stanger (i) was engaged by us to provide a fairness opinion in connection with our merger with SOR and the corresponding exchange ratio; and (ii) performed a valuation involving one of our prospective acquisitions. Stanger received usual and customary fees in connection with those services. Stanger may from time to time in the future perform other services us, so long as such other services do not adversely affect the independence of Stanger as certified in the applicable Appraisal Report.

Although Stanger considered any comments received from us or the Advisor relating to their Reports, the final appraised values of our real estate properties were determined by Stanger. The Reports are addressed solely to the nominating and corporate governance committee to assist it in calculating and recommending to our board of directors an estimated value per share of our common stock. The Reports are not addressed to the public, may not be relied upon by any other person to establish an estimated value per share of our common stock, and do not constitute a recommendation to any person to purchase or sell any shares of the our common stock.

The foregoing is a summary of the standard assumptions, qualifications, and limitations that generally apply to the Reports. The Reports, including the analysis, opinions, and conclusions set forth in such reports, are qualified by the assumptions, qualifications, and limitations set forth in the respective reports.

Real Estate Valuation 

As described above, we engaged Stanger to provide an appraisal of the Appraised Properties consisting of 68 of the 70 properties in our portfolio (including an ownership interest in a joint venture which owns a data center facility in Ashburn, Virginia), in addition to one joint venture development in Patterson, California that was scheduled to be wholly acquired upon construction completion and an office asset in Nashville, Tennessee which we own a partial interest through a membership interest in a Delaware Statutory Trust, as of June 30, 2015. In preparing the Appraisal Report, Stanger, among other things:

• performed a site visit of each Appraised Property;

• interviewed our officers or the Advisor's personnel to obtain information relating to the physical condition of each Appraised Property, including known environmental conditions, status of ongoing or planned property additions and reconfigurations, and other factors for such leased properties;

• reviewed lease agreements for those properties and discussed with us or the Advisor certain lease provisions and factors on each property; and

• reviewed the acquisition criteria and parameters used by real estate investors for properties similar to the subject properties, including a search of real estate data sources and publications concerning real estate buyer's criteria, discussions with sources deemed appropriate, and a review of transaction data for similar properties.

Stanger employed the income approach to estimate the value of the Appraised Properties, which involves an economic analysis of the property based on its potential to provide future net annual income. As part of the valuation, a discounted cash flow analysis was used to determine the value of our interest in the portfolio, by valuing the subject interest in each Appraised Property in the portfolio based upon the leases that encumber such property. The indicated value by the discounted cash flow approach represents the amount an investor would probably pay for the expectation of receiving the net cash flow from the property during the subject lease term and the proceeds from the ultimate sale of the property.

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Stanger prepared the Appraisal Report, summarizing key inputs and assumptions, for each of the Appraised Properties it appraised using financial information provided by us and our Advisor. From such review, Stanger selected the appropriate cash flow discount rate, residual discount rate, and terminal capitalization rate. As for those properties consolidated on our financials, and for which we do not own 100% of the ownership interest, the property value was adjusted to reflect our ownership interest in such property after consideration of the distribution priorities associated with such property.

Three additional properties located in Westchester, Ohio; Houston, Texas; and Glendale, California which were all acquired within nine months of January 1, 2015 were included in the NAV Report at their respective acquisition prices.

As of September 30, 2015, we owned 71 real estate assets (including an ownership interest in a joint venture which owns a data center facility in Ashburn, Virginia), in addition to one joint venture development in Patterson, California that was scheduled to be wholly acquired upon construction completion and one membership interest in a Delaware Statutory Trust which owns an office asset in Nashville, Tennessee. The total acquisition cost of these properties at our respective ownership interest, including the joint venture development and the office asset owned through a membership interest in a Delaware Statutory Trust was approximately $3.02 billion, excluding acquisition fees and expenses. In addition, through September 30, 2015, we had invested $26.8 million in capital improvements on these real estate assets since inception. As of September 30, 2015, the total value of the Appraised Properties at our respective ownership interest, as provided by Stanger, assuming the expected buyout of the joint venture development and the acquisition price of the three real estate assets acquired during 2015 was approximately $3.35 billion. This represents an approximately 10.0% increase in the total value of the real estate assets over the aggregate basis. The following summarizes the key assumptions that were used in the discounted cash flow models used to arrive at the appraised value of the Appraised Properties:

					Weighted Average
	Range
Terminal Capitalization Rate	6.25	%	8.5	%	6.97%
Cash Flow Discount Rate	4.75	%	9.5	%	6.64%
Residual Discount Rate	6.5	%	8.75	%	7.44%
Income and Expense Growth	3%				3%

While we believe that Stanger's assumptions and inputs are reasonable, a change in these assumptions and inputs would significantly impact the calculation of the appraised value of the Appraised Properties and thus, the estimated value per share. The table below illustrates the impact on the estimated value per share if the terminal capitalization rates or discount rates were adjusted by 25 basis points or 5.0%, and assuming all other factors remain unchanged:

	Estimated Value Per Share due to:
	Increase 25 Basis	Decrease 25 Basis	Increase	Decrease
	Points	Points	5.0%	5.0%
Terminal Capitalization Rate	$10.09	$10.71	$9.98	$10.84
Cash Flow Discount Rate	$10.31	$10.49	$10.28	$10.52
Residual Discount Rate	$10.18	$10.62	$10.07	$10.73

Loans

Values for mortgage loans, the line of credit, and term loan (the "Loans") were estimated by Stanger using a discounted cash flow analysis, which used inputs based on the remaining loan terms and estimated current market interest rates for mortgage loans with similar characteristics, including remaining loan term, loan-to-value ratios, debt-service-coverage ratios, prepayment terms, and collateral property attributes. The current market interest rate was generally determined based on market rates for available comparable debt. The estimated current market interest rates for the loans ranged from 1.64% to 6.70%.

As of September 30, 2015, Stanger's estimate of fair value of our consolidated Loans and ownership interest in unconsolidated Loans was $1.3 billion and $87.3 million, respectively. The weighted-average discount rate applied to the future estimated debt payments, excluding the line of credit and term loan, was approximately 4.35% and including the line of credit and term loan was approximately 2.49%.

While we believe that Stanger's assumptions and inputs are reasonable, a change in these assumptions and inputs would significantly impact the calculation of the estimated value of our loans and thus, the estimated value per share. The table below illustrates the impact on the estimated value per share if the market interest rate were adjusted by 25 basis points or 5.0%, and assuming all other factors remain unchanged:

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Estimated Value Per Share due to:
Decrease 25 Basis Points	Increase 25 Basis Points	Decrease 5.0%	Increase 5.0%
$10.37	$10.43	$10.37	$10.42

Unconsolidated Entities

In those situations where our assets and liabilities are held in unconsolidated entities, Stanger valued those interests by:

• utilizing the value of the properties that are owned by the unconsolidated entities based upon its appraisal;

• adding the other tangible assets held by the unconsolidated entities;

• deducting the tangible liabilities of the unconsolidated entities, including any mortgage debt encumbering the unconsolidated entities properties after considering mark-to-market adjustments on such mortgage debt based on the debt information provided by us; and

• taking the resulting unconsolidated entities equity from the above steps and processing such equity through the unconsolidated entities agreement as it pertains to capital distribution allocations, to determine the amount of equity attributable to us.

Other Assets and Liabilities

To derive our estimated value per share, Stanger added the other tangible assets and liabilities, including our redeemable preferred units from a draft of our September 30, 2015 balance sheet, to its estimated value of the real estate assets, mortgage loans, and the unconsolidated entities.

The carrying value of a majority of our other assets and liabilities are considered to equal their fair value due to their short maturities or liquid nature. Certain balances, such as straight-line rent receivables, lease intangible assets and liabilities, deferred financing costs, unamortized lease commissions, and unamortized lease incentives, have been eliminated for the purpose of the valuation due to the fact that the value of those balances were already considered in the valuation of the respective investments.

Different parties using different assumptions and estimates could derive a different estimated value per share, and these differences could be significant. The value of our shares will fluctuate over time in response to developments related to individual assets in our portfolio and the management of those assets and in response to the real estate and finance markets.

Advisor Promote

The estimated value per share was calculated net of the Advisor's subordinated share of net proceeds in the event of a liquidation of the portfolio, which we advised Stanger was equal to:

• 5% if stockholders are paid return of capital plus between 6% and 8% annual cumulative, non-compounded return;

• 10% if stockholders are paid return of capital plus between 8% and 10% annual cumulative, non-compounded return; and

• 15% if stockholders are paid return of capital plus a 10% or more annual cumulative, non-compounded return.

Limitations of Estimated Value Per Share

The various factors considered by our board of directors in determining the estimated value per share was based on a number of assumptions and estimates that may not be accurate or complete. As mentioned above, we are providing this estimated value per share to assist broker-dealers that participated in our public offerings in meeting their customer account statement reporting obligations. As with any valuation methodology, the methodologies used are based upon a number of estimates and assumptions that may not be accurate or complete. Different parties with different assumptions and estimates could derive a different estimated value per share. The estimated value per share is not audited and does not represent the fair value of our assets or liabilities according to GAAP.

Accordingly, with respect to the estimated value per share, we can give no assurance that:

• a stockholder would be able to resell his or her shares at this estimated value;

• a stockholder would ultimately realize distributions per share equal to our estimated value per share upon liquidation of our assets and settlement of our liabilities or a sale of our business;

• our shares of common stock would trade at the estimated value per share on a national securities exchange;

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• an independent third-party appraiser or other third-party valuation firm would agree with our estimated value per share; or

• the methodology used to estimate our estimated value per share would be acceptable to FINRA or for compliance with ERISA reporting requirements.

 Similarly, the amount a stockholder may receive upon repurchase of his or her shares, if he or she participates in our SRP, may be greater than or less than the amount a stockholder paid for the shares, regardless of any increase in the underlying value of any of our assets. 

In addition, the estimated value per share is based on the estimated value of our assets less the estimated value of our liabilities divided by the number of shares outstanding on an adjusted fully diluted basis, calculated as of September 30, 2015. The estimated value per share was based upon 179,693,496 shares of equity interest outstanding as of September 30, 2015, which was comprised of (i) 174,750,370 outstanding shares of our common stock, plus (ii) 4,939,793 outstanding units of limited partnership interest in our Operating Partnership, which units are exchangeable on a one-for-one basis into shares of common stock, plus (iii) 3,333 shares of unvested restricted common stock issued to our independent directors which shares vest ratably over time.

In addition, the estimated value per share considered by our board of directors as of October 22, 2015 does not reflect the actual or estimated portfolio liquidation value range or potential "enterprise value" range our business or our real estate portfolio. For example, it does not include a premium for:

• the large size of our portfolio, as buyers may be willing to pay more for a large portfolio than they are willing to pay for each property in the portfolio separately, commonly referred to as a "portfolio premium" or "aggregation premium";

• the potential increase in our share value if it were to list our shares on a national securities exchange reflecting potential premiums to net asset values and earnings multiples typically applied to valuing publicly-listed companies; or

• the potential value per share we may achieve if we were to merge with or be acquired by a publicly-listed real estate investment trust or other real estate company, resulting from potential premiums to net asset values and earnings multiples typically applied to valuing companies in such transactions.

Further, the value of our shares will fluctuate over time in response to developments related to individual assets in our portfolio and the management of those assets and in response to the real estate and finance markets. The estimated value per share does not reflect a discount for the fact that we are externally managed, nor does it reflect a real estate portfolio premium/discount versus the sum of the individual property values. The estimated value per share also does not take into account estimated disposition costs and fees for real estate properties that are not held for sale. We currently expect to utilize an independent valuation firm to update the estimated value per share in the second half of 2016, in accordance with IPA Valuation Guidelines.

Distributions

We elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended, for the year ended December 31, 2010, and for each year thereafter. To qualify as a REIT, we must meet certain organizational and operational requirements, and continue to adhere to these requirements for each subsequent year. As a REIT, we generally will not be subject to federal income tax on taxable income that we distribute to our stockholders. However, we may be subject to certain state and local taxes on our income and property, and federal income and excise taxes on our undistributed taxable income, if any. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income taxes on our taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year during which qualification is lost unless the IRS grants us relief under certain statutory provisions. Such an event could materially adversely affect our net income and net cash available for distribution to stockholders. As of December 31, 2015, we satisfied the REIT requirements and distributed all of our taxable income.

Distributions to stockholders are characterized for federal income tax purposes as ordinary income, capital gains, non-taxable return of capital or a combination of the three. Distributions that exceed our current and accumulated earnings and profits (calculated for tax purposes) constitute a return of capital for tax purposes rather than a distribution and reduce the stockholders’ basis in our common shares. To the extent that a distribution exceeds both current and accumulated earnings and profits and the stockholders’ basis in the common shares, it will generally be treated as a capital gain. We will annually notify stockholders of the taxability of distributions paid during the preceding year.

Distributions for a given month are paid on or around the first day of the month following the month of distribution and are paid from operating cash flow generated from our properties or offering proceeds raised in future public offerings (if any).

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The following table shows the distributions we have declared and paid during each quarter in the years ended December 31, 2015 and 2014 (in thousands, except per share amounts):

Quarter	Total Distributions Declared and Paid to Preferred Equity Holders(1)		Total Distributions Declared and Paid to Limited Partners(1)		Total Distributions Declared and Paid to Stockholders (1)		Distributions Declared per Common Share (2)
1st Quarter 2014	$	4,687	$	825	$	11,698	$	0.17
2nd Quarter 2014	$	4,740	$	858	$	21,168	$	0.17
3rd Quarter 2014	$	4,792	$	868	$	22,332	$	0.17
4th Quarter 2014	$	4,792	$	868	$	22,548	$	0.17
1st Quarter 2015	$	4,687	$	849	$	22,258	$	0.17
2nd Quarter 2015	$	2,904	$	858	$	24,370	$	0.17
3rd Quarter 2015	$	1,198	$	868	$	30,430	$	0.17
4th Quarter 2015	$	456	$	943	$	30,544	$	0.17

(1) Declared distributions are paid monthly in arrears.

(2) Distributions declared per common share amounts are rounded to the nearest $0.01.

Securities Authorized for Issuance under Equity Compensation Plans

On February 12, 2009, our board of directors adopted our Employee and Director Long-Term Incentive Plan (the “Plan”) in order to (1) provide incentives to individuals who are granted awards because of their ability to improve our operations and increase profits; (2) encourage selected persons to accept or continue employment with us or with our Advisor or its affiliates that we deem important to our long-term success; and (3) increase the interest of our independent directors in our success through their participation in the growth in value of our stock. Pursuant to the Plan, we may issue stock-based awards to our directors and full-time employees (should we ever have employees), executive officers and full-time employees of our Advisor and its affiliates that provide services to us and who do not have any beneficial ownership of our Advisor and its affiliates, entities and full-time employees of entities that provide services to us, and certain consultants to us, our Advisor and its affiliates that provide services to us.

The term of the Plan is 10 years and the total number of shares of common stock reserved for issuance under the Plan is 10% of the outstanding shares of stock at any time, not to exceed 10,000,000 shares in the aggregate. Awards granted under the Plan may consist of stock options, restricted stock, stock appreciation rights and other equity-based awards. The stock-based payment will be measured at fair value and recognized as compensation expense over the vesting period. As of December 31, 2015, awards totaling 14,000 shares of restricted stock have been granted to our independent board members under the Plan.

Upon our reorganization, merger or consolidation with one or more corporations as a result of which we are not the surviving corporation, or upon sale of all or substantially all of our assets, that, in each case, is not an equity restructuring, appropriate adjustments as to the number and kind of shares and exercise prices will be made either by our compensation committee or by such surviving entity. Such adjustment may provide for the substitution of such awards with new awards of the successor entity or the assumption of such awards by such successor entity. Alternatively, rather than providing for the adjustment, substitution or assumption of awards, the compensation committee may either (1) shorten the period during which awards are exercisable, or (2) cancel an award upon payment to the participant of an amount in cash that the compensation committee determines is equivalent to the amount of the fair market value of the consideration that the participant would have received if the participant exercised the award immediately prior to the effective time of the transaction.

In the event that the compensation committee determines that any distribution, recapitalization, stock split, reorganization, merger, liquidation, dissolution or sale, transfer, exchange or other disposition of all or substantially all of our assets, or other similar corporate transaction or event, affects the stock such that an adjustment is appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or with respect to an award, then the compensation committee shall, in such manner as it may deem equitable, adjust the number and kind of shares or the exercise price with respect to any award.

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The following table provides information about the common stock that may be issued under the Plan as of December 31, 2015:

Plan Category	Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights	Weighted Average Exercise Price of Outstanding Options, Warrants and Rights	Number of Securities Remaining for Future Issuance Under Equity Compensation Plans(1)
Equity Compensation Plans Approved by Security Holders	—	—	9,986,000
Equity Compensation Plans Not Approved by Security Holders	—	—	—
Total	—	—	9,986,000

(1) The total number of shares of our common stock (or common stock equivalents) reserved for issuance under the Plan is equal to 10% of our outstanding shares of stock at any time, but not to exceed 10,000,000 shares in the aggregate. As of December 31, 2015, we had 175,184,519 outstanding shares of common stock, including shares issued pursuant to the distribution reinvestment plan, therefore the Plan was limited to the issuance of 10,000,000 shares.

Recent Sales of Unregistered Securities

During the fourth quarter of 2015, there were no sales of unregistered securities.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

Share Redemption Program

On February 20, 2009, our board of directors adopted a share redemption program, which enables our stockholders to have their shares redeemed by us, subject to certain significant conditions and limitations. Our share redemption program has no set termination date, but our ability to redeem shares under the program is limited.

As of December 31, 2015 and 2014, $110.2 million and $57.7 million in shares of common stock, respectively, had been issued under the DRP, pursuant to the Private Offering, the Public Offerings, and the DRP Offerings, of which $6.3 million and $1.2 million in redemptions, respectively, were reclassified from redeemable common stock to accounts payable and accrued liabilities in the consolidated balance sheets. During the year ended December 31, 2015, we redeemed 1,397,801 shares of common stock for approximately $13.8 million at a weighted average price per share of $9.89. Since inception and through December 31, 2015, we had redeemed 1,753,700 shares of common stock for approximately $17.3 million at a weighted average price per share of $9.88 pursuant to the SRP. As of December 31, 2015, there were 638,483 shares totaling $6.3 million subject to redemption requests. Our board of directors may choose to amend, suspend or terminate our share redemption program upon 30 days’ written notice at any time.

During the quarter ended December 31, 2015, we redeemed shares as follows:

For the Month Ended	Total Number of Shares Redeemed	Average Price Paid per Share		Total Number of Shares Redeemed as Part of Publicly Announced Plans or Programs	Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May  Yet Be Purchased Under the Plans or Programs
October 31, 2015	845,051	$	9.94	845,051	(1)
November 30, 2015	—	N/A		—	—
December 31, 2015	—	N/A		—	—

(1) A description of the maximum number of shares that may be purchased under our share redemption program is included in Note 8, Equity, to the consolidated financial statements.

ITEM 6. SELECTED FINANCIAL DATA

The following selected financial and operating information should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and the financial statements and related notes thereto included elsewhere in this annual report on Form 10-K (in thousands, except per share data):

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	For the Year Ended December 31,
	2015			2014			2013			2012			2011
Operating Data
Total revenue	$	290,095		$	202,394		$	68,916		$	25,490		$	15,009
Income (loss) from operations	35,109			22,501			(10,603		)	2,085			1,165
Net income (loss)	15,621			14			(24,469		)	(5,674		)	(4,621		)
Net loss attributable to common stockholders	(3,750		)	(18,654		)	(24,664		)	(4,195		)	(2,535		)
Net loss attributable to common stockholders per share, basic and diluted	(0.02		)	(0.17		)	(0.97		)	(0.46		)	(0.72		)
Distributions declared per common share	0.69			0.68			0.68			0.68			0.68
Balance Sheet Data
Total real estate, net	$	2,696,026		$	1,721,012		$	1,132,617		$	309,445		$	162,863
Total assets	3,050,289			2,065,447			1,225,396			334,796			175,945
Total debt	1,486,326			625,696			489,778			194,812			95,429
Total liabilities	1,649,758			755,498			563,466			213,190			107,130
Preferred units subject to redemption	—			250,000			250,000			—			—
Redeemable noncontrolling interests	4,887			12,543			4,887			4,887			4,887
Redeemable common stock	86,557			56,421			12,469			3,439			1,070
Total stockholders’ equity	1,287,769			973,507			374,838			95,769			41,071
Total equity	1,309,087			990,985			394,574			113,281			62,858
Other Data
Net cash provided by (used in) operating activities	$	92,458		$	73,249		$	948		$	5,058		$	(1,184	)
Net cash used in investing activities	(414,371		)	(757,903		)	(845,672		)	(154,066		)	(14,651		)
Net cash provided by financing activities	274,942			743,162			849,458			149,252			19,628

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following “Management’s Discussion and Analysis of Financial Condition and Result of Operations” should be read in conjunction with the financial statements and the notes thereto contained in this report.

Overview

We are a public, non-traded REIT that invests primarily in business essential properties significantly occupied by a single tenant, diversified by corporate credit, physical geography, product type, and lease duration. As described in more detail in Item 1 of this report, we were formed on August 28, 2008 and commenced operations on May 6, 2009. We have no employees and are externally advised and managed by an affiliate, Griffin Capital Essential Asset Advisor, LLC, our Advisor.

On April 25, 2013, we terminated our Initial Public Offering, having issued approximately 19,200,570 total shares of our common stock for gross proceeds of approximately $191.5 million, including 585,533 shares, or $5.6 million, issued pursuant to the distribution reinvestment plan (“DRP”).

On April 22, 2014, we terminated our Follow-On Offering, having issued 107,144,337 total shares of our common stock for gross proceeds of approximately $1.1 billion, including 1,774,208 shares, or $17.3 million, issued pursuant to the DRP.

On May 7, 2014, we filed a Registration Statement on Form S-3 with the SEC for the registration of $75.0 million in shares for sale pursuant to the DRP (the “2014 DRP Offering”). On September 22, 2015, we filed a Registration Statement on Form S-3 with the SEC for the registration of $100.0 million in shares for sale pursuant to the DRP (the “2015 DRP Offering” and together with the 2014 DRP Offering, the “DRP Offerings”) and terminated the 2014 DRP Offering. In connection with our DRP Offerings, we had issued 8,579,699 shares of our common stock for gross proceeds of approximately $87.3 million through December 31, 2015. The 2015 DRP Offering may be terminated at any time upon 10 days' prior written notice to

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stockholders. Since inception and through December 31, 2015, we had redeemed 1,753,700 shares of common stock for approximately $17.3 million at a weighted average price per share of $9.88 pursuant to the share redemption program.

As of December 31, 2015, our real estate portfolio consisted of 74 properties in 20 states for a total purchase price of approximately $3.0 billion, net of properties sold for a total selling price of approximately $104.7 million with an initial acquisition value of $96.2 million, and an 80% interest in an unconsolidated joint venture for a total purchase price of approximately $148.4 million, as discussed in Note 4, Investments, to the consolidated financial statements. The tenants of our properties operate in a diverse range of industries, including consumer products, financial services, manufacturing, education, printing, technology, telecommunications, insurance, energy, and aerospace, as described in more detail in Part I, Item 2 of this report.

Acquisition Indebtedness

For a discussion of our acquisition indebtedness, see Note 3, Real Estate, and Note 5, Debt, to the consolidated financial statements.

Significant Accounting Policies and Estimates

We have established accounting policies which conform to generally accepted accounting principles (“GAAP”) as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (the “Codification” or "ASC"). The preparation of our consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. If our judgment or interpretation of the facts and circumstances relating to the various transactions had been different, it is possible that different estimates would have been applied, thus resulting in a different presentation of the financial statements. Additionally, other companies may use different estimates and assumptions that may impact the comparability of our financial condition and results of operations to those companies.

The following critical accounting policies discussion reflects what we believe are the most significant estimates, assumptions, and judgments used in the preparation of our consolidated financial statements. This discussion of our critical accounting policies is intended to supplement the description of our accounting policies in the footnotes to our consolidated financial statements and to provide additional insight into the information used by management when evaluating significant estimates, assumptions, and judgments. For further discussion on our significant accounting policies, see Note 2, Basis of Presentation and Summary of Significant Accounting Policies, to our consolidated financial statements included in this report.

Real Estate - Valuation and Purchase Price Allocation

When we acquire operating properties, we allocate the purchase price to the various components of the acquisition based upon the fair value of each component. The components typically include land, building and improvements, tenant improvements, intangible assets related to above and below market leases, intangible assets related to in-place leases, debt and other assumed assets and liabilities. Because of the timing or complexity of completing certain fair value adjustments, the initial purchase price allocation may be incomplete at the end of a reporting period, in which case we may record provisional purchase price allocation amounts based on information available at the acquisition date. Subsequent adjustments to provisional amounts are recognized during the measurement period, which cannot exceed one year from the date of acquisition.

We allocate the purchase price to the fair value of the tangible assets of a property by valuing the property as if it were vacant. This “as-if vacant” value is estimated using an income, or discounted cash flow, approach that relies upon Level 3 inputs, which are unobservable inputs based on our assumptions about the assumptions a market participant would use. These Level 3 inputs include discount rates, capitalization rates, market rents and comparable sales data for similar properties. Estimates of future cash flows are based on a number of factors including historical operating results, known and anticipated trends, and market and economic conditions.

In determining the fair value of intangible lease assets or liabilities, we also consider Level 3 inputs. Acquired above- and below-market leases are valued based on the present value of the difference between prevailing market rates and the in-place rates measured over a period equal to the remaining term of the lease for above-market leases and the initial term plus the term of any below-market fixed rate renewal options for below-market leases, if applicable. The estimated fair value of acquired in-place at-market tenant leases are the costs that would have been incurred to lease the property to the occupancy level of the property at the date of acquisition. Such estimates include the value associated with leasing commissions, legal and other costs, as well as the estimated period necessary to lease such property that would be incurred to lease the property to its occupancy level at the time of its acquisition. Acquisition costs associated with the business combination are expensed in the period they are incurred.

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The difference between the fair value and the face value of debt assumed in connection with an acquisition is recorded as a premium or discount and amortized to “interest expense” over the life of the debt assumed. The valuation of assumed liabilities is based on our estimate of the current market rates for similar liabilities in effect at the acquisition date.

For acquisitions that do not meet the accounting criteria to be accounted for as a business combination, we allocate the cost of the acquisition, which includes any associated acquisition costs, to the individual assets (typically land and building) and liabilities assumed on a relative fair value basis.

Impairment of Real Estate and Related Intangible Assets and Liabilities

We continually monitor events and changes in circumstances that could indicate that the carrying amounts of real estate and related intangible assets may not be recoverable. When indicators of potential impairment are present that indicate that the carrying amounts of real estate and related intangible assets may not be recoverable, management will assess the recoverability of the assets by determining whether the carrying value of the assets will be recovered through the undiscounted future operating cash flows expected from the use of the assets and the eventual disposition. If based on this analysis we do not believe that we will be able to recover the carrying value of the asset, we will record an impairment loss to the extent the carrying value exceeds the estimated fair value of the asset.

Projections of expected future undiscounted cash flows require management to estimate future market rental income amounts subsequent to the expiration of current lease agreements, property operating expenses, discount rates, the number of months it takes to re-lease the property and the number of years the property is held for investment. As of December 31, 2015, we did not record any impairment charges related to our real estate assets or intangible assets.

Revenue Recognition

Leases associated with the acquisition and contribution of certain real estate assets have net minimum rent payment increases during the term of the lease and are recorded to rental revenue on a straight-line basis, commencing as of the contribution or acquisition date. If a lease provides for contingent rental income, we will defer the recognition of contingent rental income, such as percentage rents, until the specific target that triggers the contingent rental income is achieved.

Tenant reimbursement revenue, which is comprised of additional amounts collected from tenants for the recovery of certain operating expenses, including repair and maintenance, property taxes and insurance, and capital expenditures, to the extent allowed pursuant to the lease (collectively "Recoverable Expenses"), is recognized as revenue when the additional rent is due. Recoverable Expenses to be reimbursed by a tenant are determined based on our estimate of the property's operating expenses for the year, pro rated based on leased square footage of the property, and are collected in equal installments as additional rent from the tenant, pursuant to the terms of the lease. At the end of the calendar year, we reconcile the amount of additional rent paid by the tenant during the year to the actual amount of Recoverable Expenses incurred by us for the same period. The difference, if any, is either charged or credited to the tenant pursuant to the provisions of the lease. In certain instances, the lease may restrict the amount we can recover from the tenant such as a cap on certain or all property operating expenses.

Recently Issued Accounting Pronouncements

See Note 2, Basis of Presentation and Summary of Significant Accounting Policies, to the consolidated financial statements.

Results of Operations

We are not aware of any material trends or uncertainties, other than national economic conditions affecting real estate in general, that may reasonably be expected to have a material impact, favorable or unfavorable, on revenues or income from the acquisition, management, and operations of properties other than those listed in Part I, Item 1A. Risk Factors, of this Annual Report on Form 10-K.

Same Store Analysis

As of December 31, 2015, our "Same Store" portfolio consisted of 38 properties, encompassing approximately 7.5 million square feet, with an acquisition value of $1.1 billion and annual net rent of $91.5 million (for the 12-month period subsequent to December 31, 2015). The following table provides a comparative summary of the results of operations for the 38 properties for the years ended December 31, 2015 and 2014 (dollars in thousands):

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	Year Ended December 31,				Increase/ (Decrease)			Percentage Change
	2015		2014
Rental income	$	113,381	$	109,994	$	3,387		3	%
Property expense recoveries	30,002		30,743		(741		)	(2	)%
Asset management fees to affiliates	8,142		8,091		51			1	%
Property management fees to affiliates	4,138		4,059		79			2	%
Property operating expense	23,653		24,849		(1,196		)	(5	)%
Property tax expense	17,564		18,008		(444		)	(2	)%

Rental Income

The increase in rental income is primarily due to (1) $0.5 million in additional rent related to a lease commencement at the One Century Place property in the prior period, for which there was a full year of rent recognized in the current period; (2) $1.2 million in additional rent related to a lease commencement on January 1, 2015 at the Northpointe Corporate Center II property; and (3) a $1.9 million net adjustment to straight-line rent and accelerated amortization of the in-place lease intangible at the Wells Fargo property (acquired in 2013), which resulted from the early lease termination effective December 31, 2015. For comparability purposes, the rental income for the year ended December 31, 2015 does not include the $9.0 million termination fee related to the Wells Fargo property, which is included in rental income on the consolidated statements of operations.

Property Expense Recoveries

The decrease in property expense recoveries is primarily due to (1) a $0.4 million decrease in expense recoveries for the Nokia property, which became self-managed in August 2014; and (2) a $1.5 million decrease in the current year expense recoveries as a result of the 2015 common area maintenance ("CAM") reconciliations primarily related to decreases in operating and tax expenses; offset by (3) a $1.2 million increase in property tax recoveries related to the Community Insurance, Travelers, and other properties.

Property Operating Expense

The decrease in property operating expense is primarily due to (1) $0.6 million related to the Nokia and Community Insurance properties, which became self-managed in August 2014 and December 2014, respectively; and (2) $0.7 million related to the Schlumberger, IBM, and One Century Place properties, primarily for utilities and repairs and maintenance.

Property Tax Expense

The decrease in property tax expense is primarily due to (1) a $1.1 million decrease in property taxes due to a successful 2014 tax appeal in September 2015 for the Nokia property and an additional payment made during the year ended December 31, 2014 as a result of a prior year reassessment for the JPMorgan Chase property; offset by (2) a $0.6 million increase related to property reassessments for the Northrop Grumman, Schlumberger, CHRISTUS Health, and United HealthCare properties.

As of December 31, 2014, our "Same Store" portfolio consisted of 14 properties, encompassing approximately 3.3 million square feet, with an acquisition value of $325.2 million and annual net rent of $25.6 million (for the 12-month period subsequent to December 31, 2014). The following table provides a comparative summary of the results of operations for the 14 properties for the years ended December 31, 2014 and 2013 (dollars in thousands):

	Year Ended December 31,				Increase/(Decrease)			Percentage Change
	2014		2013
Rental income	$	27,096	$	30,025	$	(2,929	)	(10	)%
Property expense recoveries	$	4,518	$	5,141	(623		)	(12	)%
Asset management fees to affiliates	$	2,443	$	2,441	2			—	%
Property management fees to affiliates	$	934	$	976	(42		)	(4	)%
Property operating expenses	$	2,310	$	2,133	177			8	%
Property tax expense	$	3,843	$	3,960	(117		)	(3	)%

Rental Income

The decrease in rental income is directly a result of the World Kitchen, LLC lease termination, which became effective on January 24, 2014. As a result of the termination, there was a decrease of approximately $1.8 million in base rent. Additionally,

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the unamortized in-place lease valuation ($0.9 million) and deferred rent asset ($0.3 million) were written off during the year ended December 31, 2014. For comparability purposes, the rental income for the year ended December 31, 2014 does not include the $7.125 million termination fee, which is included in rental income on the consolidated statements of operations.

Property Expense Recoveries

The decrease in property expense recoveries is primarily a result of the World Kitchen, LLC lease termination which resulted in a decrease of approximately $0.6 million in property tax expense recoveries.

Property Management Fees to Affiliates

The property management fee decrease is primarily due to the differential between the base rent and the lease termination payments as a result of the World Kitchen, LLC lease termination, as discussed above, which represents approximately $0.02 million of the variance. The remaining $0.02 million is a result of various adjustments to the property management fee rates applied, pursuant to provisions of the leases.

Property Operating Expense

The increase in property operating expense is due to an increase of $0.2 million in utilities, repairs and maintenance, and property services primarily for the Will Partners and Northrop Grumman properties, offset by a decrease of approximately $0.02 million primarily related to the Travelers, Zeller Plastik, and Health Net properties.

Property Tax Expense

The decrease in property tax expense is primarily a result of a $0.2 million decrease for the Will Partners property, which is due to a $0.3 million tax rebate related to 2013 taxes paid in 2014, which World Kitchen, LLC was entitled to prior to the termination of its lease, offset by an increase of $0.07 million due to property tax reassessments and other services for the Plainfield, Travelers, Zeller Plastik, Northrop Grumman, and Health Net properties.

Portfolio Analysis

As of December 31, 2014, we owned 56 properties, and, as shown in the table in Part I, Item 2 of this report, as of December 31, 2015, we owned 74 properties. As of December 31, 2015, we have completed the offering stage of our life cycle, and continue to deploy capital raised in our Public Offerings, along with draws from our Unsecured Credit Facility (July 2015), to acquire assets that adhere to our investment criteria. Therefore, our results of operations for our entire portfolio for the year ended December 31, 2015 are not directly comparable to those for the same period in the prior year as the variances are substantially the result of portfolio growth, specifically in rental income, operating expenses, acquisition fees and reimbursable expenses, and depreciation and amortization expenses. See Same Store analysis above for properties held for the same period of time.

Comparison of the Years Ended December 31, 2015 and 2014

The following table provides summary information about our results of operations for the years ended December 31, 2015 and 2014 (dollars in thousands):

	Year Ended December 31,				Increase/(Decrease)			Percentage Change
	2015		2014
Rental income	$	235,148	$	164,412	$	70,736		43	%
Property expense recoveries	54,947		37,982		16,965			45	%
Asset management fees to affiliates	19,389		12,541		6,848			55	%
Property management fees to affiliates	7,622		5,445		2,177			40	%
Property operating expense	37,924		30,565		7,359			24	%
Property tax expense	34,733		24,873		9,860			40	%
Acquisition fees and expenses to non-affiliates	2,730		4,261		(1,531		)	(36	)%
Acquisition fees and expenses to affiliates	32,245		24,319		7,926			33	%
General and administrative expenses	7,595		4,982		2,613			52	%
Depreciation and amortization	112,748		72,907		39,841			55	%
Interest expense	33,402		24,598		8,804			36	%

Rental Income

Rental income for the year ended December 31, 2015 is comprised of base rent of $217.6 million, adjustments to straight-line contractual rent of $13.8 million, and in-place lease valuation amortization, net, of approximately $3.8 million. Rental

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income for the year ended December 31, 2015 increased by $70.7 million compared to the same period in the prior year primarily as a result of (1) $49.3 million of additional rental income related to the real estate acquired in the current period and a development project with WRRH Patterson, LLC, which was placed into service on August 15, 2015; (2) $18.7 million of additional rental income related to the real estate acquired during the year ended December 31, 2014, which includes a full year of rental income for 2015; (3) a net increase of $1.9 million in termination income related to lease terminations at the SoftBank and Wells Fargo (acquired in 2013) properties effective August 31, 2015 and December 31, 2015, respectively, partially offset by the World Kitchen, LLC lease termination in the prior period; and (4) a $1.9 million net adjustment to straight-line rent and accelerated amortization of the in-place lease intangible at the Wells Fargo property, which resulted from the early lease termination; less (5) $3.4 million of decreased rental income due to the sale of the Eagle Rock and College Park properties on December 17, 2014 and February 20, 2015, respectively.

Property Expense Recoveries

Also included as a component of revenue is the recovery of property operating expenses, including repairs and maintenance, property taxes and insurance, and certain capital expenses (collectively "Recoverable Expenses"), which increased by $17.0 million compared to the same period in the prior year primarily as a result of (1) $14.1 million of additional expense recovery revenue related to properties acquired in the current period, net of the related CAM adjustments; and (2) $3.0 million of additional expense recovery revenue related to the real estate acquired during the year ended December 31, 2014, which includes a full period of recoverable expenses for the year ended December 31, 2015, net of the related CAM adjustments.

Management Fees (Asset and Property)

Asset management and property management fees for the years ended December 31, 2015 and 2014 totaled $27.0 and $18.0 million, respectively. The total increase of $9.0 million compared to the same period a year ago is primarily the result of (1) approximately $4.5 million and $1.7 million in asset management and property management fees, respectively, related to the acquisitions made during the current year; and (2) approximately $2.5 million and $0.5 million in asset management and property management fees, respectively, related to the acquisitions made during the year ended December 31, 2014.

Property Operating Expense

Property operating expenses for the years ended December 31, 2015and 2014 totaled $37.9 million and $30.6 million, respectively. Property operating expenses include insurance, repairs and maintenance, security, janitorial, landscaping, and other administrative expenses incurred to operate our properties. The total increase of $7.3 million compared to the same period a year ago is primarily a result of (1) $9.5 million in additional property operating expenses related to properties acquired during the current year; and (2) $1.2 million in additional property operating expenses related to properties acquired during the year ended December 31, 2014; offset by (3) a $3.4 million decrease in property operating expenses primarily related to the Eagle Rock and College Park properties, which were sold on December 17, 2014 and February 20, 2015, respectively, and certain properties which became self-managed in the prior year.

Property Tax Expense

Property tax expenses for the years ended December 31, 2015 and 2014 totaled $34.7 million and $24.9 million, respectively. The total increase of approximately $9.8 million compared to the same period a year ago is primarily a result of (1) $7.1 million in additional property tax expenses related to properties acquired during the current year; and (2) $3.7 million in additional property tax expenses related to properties acquired during the year ended December 31, 2014; offset by (3) a $0.7 decrease in property tax expenses related to the Eagle Rock and College Park properties, which were sold on December 17, 2014 and February 20, 2015, respectively; and (4) a $0.5 million decrease in property tax expenses for the Nokia property as a result of a successful 2014 tax appeal settled in September 2015.

Acquisition Fees and Expenses

Real estate acquisition fees and expenses to non-affiliates, which totaled $2.7 million for the year ended December 31, 2015, decreased by $1.5 million compared to the prior year due to decreased acquisition activity of individual properties in the current period. Acquisition fees and expenses to affiliates, which are based on the purchase price of each acquisition, increased by $7.9 million as a result of an increase in total purchase price of approximately $280.1 million compared to the prior year.

General and Administrative Expenses

General and administrative expenses for the year ended December 31, 2015 increased by $2.6 million compared to the same period a year ago due to increased operating activity. General and administrative expenses represent costs unrelated to property operations or transaction costs. These expenses primarily include corporate office expenses related to being a public company, including transfer agent fees, certain audit fees, regulatory fees, legal costs, and other professional fees. The $2.6 million increase is primarily due to the following: (1) an increase of $1.2 million in professional fees primarily for valuation

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services by third party providers and proxy campaign management services; (2) an increase of $0.7 million in allocated expenses for additional personnel and rent costs incurred by our Advisor, which is due in part to the growth in our portfolio; and (3) an increase of $0.6 million in transfer agent fees and insurance expense primarily due to increased fees related to the SOR Merger.

Depreciation and Amortization Expense

Depreciation and amortization expense for the year ended December 31, 2015 consisted of depreciation of building and building improvements of our properties of $43.3 million and amortization of the contributed and acquired values allocated to tenant origination and absorption costs of $69.4 million. The increase of $39.8 million as compared to the year ended December 31, 2014 is primarily the result of additional depreciation and amortization of (1) $24.4 million related to the acquisitions made during the year ended December 31, 2015; (2) $7.9 million related to the acquisitions made during the year ended December 31, 2014, which includes a full year of depreciation and amortization compared to partial months of activity during the year ended December 31, 2014; and (3) $12.7 million in additional amortization of absorption costs as a result of the early lease terminations at the SoftBank and Wells Fargo (acquired in 2013) properties, which were effective August 31, 2015 and December 31, 2015, respectively; less (4) $5.9 million in amortization of absorption costs primarily related to the lease termination at the Will Partners property, the sale of the Eagle Rock and College Park properties, which were sold on December 17, 2014 and February 20, 2015, respectively, and the expiration of certain leases at the Roush and One Century Place properties.

Interest Expense

Interest expense for the year ended December 31, 2015 increased by $8.8 million compared to the same period in 2014 primarily due to the following: (1) an $8.4 million increase in interest expense related to the Unsecured Credit Facility (May 2014) and the Unsecured Credit Facility (July 2015) as a result of borrowings utilized for the GE Aviation, Westgate III, DreamWorks, DynCorp, Mercedes-Benz, and Samsonite property acquisitions, preferred equity redemption, payoff of SOR debt on the merger date, and mortgage receivable entered into in the current year; (2) $3.1 million in interest expense related to the interest rate swaps entered into on July 9, 2015; and (3) an approximately $1.2 million increase in mortgage interest expense related to the AIG loan, TW Telecom loan, Ace Hardware mortgage loan, and the four mortgage loans assumed in the current year; offset by decreases of (4) $2.1 million in interest expense related to the KeyBank credit facility and the KeyBank term loan, which were terminated in conjunction with the execution of the Unsecured Credit Facility (May 2014) on May 8, 2014; (5) $0.8 million of capitalized interest related to the Restoration Hardware real estate development, which was substantially complete as of August 15, 2015; (6) $0.6 million of unused commitment fees; and (7) $0.3 million in amortization of deferred financing costs.

Comparison of the Years Ended December 31, 2014 and 2013

The following table provides summary information about our results of operations for the years ended December 31, 2014 and 2013 (dollars in thousands):

	Year Ended December 31,				Increase/(Decrease)			Percentage Change
	2014		2013
Rental income	$	164,412	$	54,605	$	109,807		201	%
Property expense recoveries	37,982		14,311		23,671			165	%
Asset management fees to affiliates	12,541		4,317		8,224			191	%
Property management fees to affiliates	5,445		1,839		3,606			196	%
Property operating expense	30,565		8,865		21,700			245	%
Property tax expense	24,873		8,061		16,812			209	%
Acquisition fees and expenses to non-affiliates	4,261		4,639		(378		)	(8	)%
Acquisition fees and expenses to affiliates	24,319		24,849		(530		)	(2	)%
General and administrative expenses	4,982		2,758		2,224			81	%
Depreciation and amortization	72,907		24,191		48,716			201	%
Interest expense	24,598		13,922		10,676			77	%

Rental Income

Rental income for the year ended December 31, 2014 is comprised of base rent of $152.4 million, adjustments to straight-line contractual rent of $11.6 million, and in-place lease valuation amortization of $0.5 million. Rental income for the year ended December 31, 2014 increased by $109.8 million compared to the same period in the prior year as a result of (1) $66.8 million of additional rental income related to the real estate acquired during the year ended December 31, 2013, which includes

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a full year of activity for the year ended December 31, 2014; (2) $38.7 million in additional rental income related to the real estate acquired during the year ended December 31, 2014; (3) approximately $6.6 million in additional lease termination fees related to World Kitchen, LLC, the tenant previously occupying the Will Partners property; (4) approximately $0.1 million in in-place lease valuation amortization; and less (5) $2.2 million in rental income as a result of the World Kitchen, LLC lease termination.

Property Expense Recoveries

Also included as a component of revenue is the recovery of maintenance expenses and certain other recoverable operating and capital expenses, including property taxes and insurance (collectively "Recoverable Expenses"), which increased by $23.7 million compared to the same period in the prior year as a result of (1) $8.1 million in property tax recoveries related to certain properties, as a result of changes in property tax expense for properties acquired during the year ended December 31, 2013 of $4.8 million, partially offset by a decrease of $0.6 million related to World Kitchen, LLC, and additional property tax recoveries related to properties acquired during the year ended December 31, 2014 of $3.9 million; (2) $14.9 million in property expense recoveries for recoverable expenses primarily related to $12.8 million for properties acquired during the year ended December 31, 2013 and $2.2 million for properties acquired during the year ended December 31, 2014; and (3) a $0.7 million increase comprised of (A) $0.4 million in other property expense recoveries related to properties acquired during the year ended December 31, 2013; (B) $0.4 million of tenant reimbursable expenses; and (C) less $0.1 million of net over collected expense recoveries.

Management Fees (Asset and Property)

Asset management and property management fees for the years ended December 31, 2014 and 2013 totaled $18.0 million and $6.2 million, respectively. The total increase of $11.8 million compared to the same period in the prior year is a result of (1) $4.5 million in asset management fees and $2.5 million in property management fees related to the acquisitions made during the year ended December 31, 2013; (2) $3.7 million in asset management fees related to the properties acquired during the year ended December 31, 2014 and the investment in an unconsolidated joint venture discussed in Note 4, Investments; and (3) $1.1 million in property management fees related to the properties acquired during the year ended December 31, 2014.

Property Operating Expense

Property operating expenses for the years ended December 31, 2014 and 2013 totaled $30.6 million and $8.9 million, respectively. Property operating expenses include insurance, repairs and maintenance, security, janitorial, landscaping, and other administrative expenses incurred to operate our properties. The total increase of $21.7 million compared to the same period in the prior year is primarily a result of (1) $0.4 million in ground lease rent expense for the Waste Management property, which was acquired on January 16, 2014; (2) $10.6 million in property operating expenses related to certain real estate for which we paid operating expenses on behalf of the tenant and recovered through estimated monthly recoverable expense reimbursements; (3) $10.2 million in property operating expenses related to certain properties that are leased pursuant to modified gross leases in which we recovered, through estimated monthly recoverable expense reimbursements, any portion of the operating expenses that exceeded the specified operating expenses (base year or expense stop) as set forth in the lease, of which $1.1 million relates to properties acquired during the year ended December 31, 2014; and (4) $0.4 million in property operating expenses related to certain properties for which it is our responsibility to cover such expenses.

Property Tax Expense

Property tax expenses for the years ended December 31, 2014 and 2013 totaled $24.9 million and $8.1 million, respectively. The total increase of $16.8 million compared to the same period in the prior year is primarily a result of (1) $11.9 million in additional property tax expenses related to the properties acquired during the year ended December 31, 2013; and (2) $5.1 million in additional property tax expenses related to the properties acquired during the year ended December 31, 2014; less (3) $0.2 million related to a property tax rebate the former tenant at the Will Partners property, World Kitchen, LLC, was entitled to receive prior to terminating the lease pursuant to the Redevelopment Agreement with the Village of Monee.

Acquisition Fees and Expenses

Real estate acquisition fees and expenses to non-affiliates, which totaled $4.3 million for the year ended December 31, 2014, decreased by approximately $0.3 million compared to the year ended December 31, 2013 due to decreased acquisition activity in 2014. Real estate acquisition fees and expenses to affiliates of $24.3 million represent the acquisition fees and expense reimbursement earned by our Advisor for 14 of the 15 properties acquired in the current period totaling $684.7 million and one investment in an unconsolidated joint venture totaling $148.4 million, which represents an 80% investment as discussed in Note 4, Investments. In addition, $0.8 million of non-affiliated acquisition expenses and affiliated acquisition fees and expenses earned by our Advisor, for a property acquired in a sale-leaseback transaction, were allocated between land and building and will be depreciated accordingly. In comparison, real estate acquisition fees and expenses to affiliates in the prior year totaled $24.8 million, which was (1) based on a total acquisition value of $851.3 million and (2) included actual

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acquisition expense reimbursement of $1.9 million paid on the Investment Grade Portfolio acquisition, which was less than the 0.50% fee pursuant to the Advisory Agreement.

General and Administrative Expenses

General and administrative expenses for the year ended December 31, 2014 increased by $2.2 million compared to the same period in the prior year due to increased operating activity. General and administrative expenses represent costs unrelated to property operations or transaction costs. These expenses primarily include corporate office expenses related to being a public company, including transfer agent fees, certain audit fees, regulatory fees, legal costs, and other professional fees. The $2.2 million increase is primarily due to the following: (1) an increase of $0.9 million in transfer agent fees as a result of higher equity sales during the year ended December 31, 2014 compared to the year ended December 31, 2013; (2) an increase of $0.4 million in allocated expenses which are related to additional personnel and rent costs incurred by our Advisor which is due in part to the growth in our portfolio; (3) an increase of $0.3 million in professional fees primarily for audit and tax fees, lease administration costs, and proxy campaign management services; (4) an increase of $0.3 million in state franchise tax expense primarily due to the allocation of properties across 19 states for the year ended December 31, 2014 compared to 18 states for the year ended December 31, 2013, as well as an increase related to a $0.2 million extension fee for Tennessee state taxes and an increase in withholding tax as a result of higher taxable income for our Operating Partnership; (5) $0.1 million in stock-based compensation for restricted stock units issued to our independent directors in 2014, where no stock awards were made in 2013; (6) an increase of $0.1 million in organizational costs primarily due to a write-off of prepaid filing fees as a result of the termination of the Follow-On Offering in 2014; and (7) an increase of $0.1 million in professional liability insurance expense as a result of an increase in coverage due to the acquisition of 15 properties during the year ended December 31, 2014, and transactions to occur in future periods.

Depreciation and Amortization Expense

Depreciation and amortization expense for the year ended December 31, 2014 consisted of depreciation of building and building improvements of our properties of $27.7 million and amortization of the contributed and acquired values allocated to tenant origination and absorption costs of $45.2 million. The increase of $48.7 million as compared to the year ended December 31, 2013 is a result of additional depreciation and amortization of (1) $17.8 million related to the acquisitions made during the year ended December 31, 2014; (2) $28.2 million related to the acquisitions made during the year ended December 31, 2013, which includes a full year of activity compared to partial months of activity during the year ended December 31, 2013; (3) $2.5 million related to the write off of unamortized tenant origination and absorption intangible assets, as allocated when the Will Partners property was contributed to the operating partnership, as a result of the lease termination; (4) $0.1 million related to leasing commissions; and (5) $0.1 million related to tenant improvements.

Interest Expense

Interest expense for the year ended December 31, 2014 increased by $10.7 million compared to the same period in 2013 due to the following: (1) $0.1 million in mortgage interest expense for seven of the eight properties refinanced on the Midland Mortgage Loan on February 28, 2013, which previously served as collateral for the KeyBank credit facility, and had a lower variable interest rate; (2) $1.2 million in mortgage interest expense related to the Ace Hardware mortgage loan which was assumed upon acquisition on April 24, 2014 and the TW Telecom loan which was entered into upon acquisition on August 1, 2014; (3) $4.0 million in mortgage interest expense for five properties refinanced through the AIG loan on January 24, 2014, which previously served as collateral for the KeyBank credit facility, and had a lower variable interest rate; (4) $0.9 million in new interest expense as it relates to the KeyBank term loan, which was originated in November 2013 to acquire the Investment Grade Portfolio, which was refinanced and terminated on May 8, 2014; (5) $3.2 million of interest expense related to the Unsecured term loan (May 2014) which was entered into on May 8, 2014; (6) $2.1 million in amortization of deferred financing costs, including $1.7 million of write-offs related to the unamortized deferred financing costs associated with the KeyBank credit facility, which was refinanced through the AIG loan on January 24, 2014, and the KeyBank term loan which was terminated in conjunction with the execution of the Unsecured term loan (May 2014) on May 8, 2014; (7) $0.8 million in additional unused commitment fees of which $0.7 million related to the Unsecured revolver (May 2014) and the remaining $0.1 million related to the KeyBank credit facility, which was fully paid off in February 2014; partially offset by (8) a $0.1 million decrease in interest expense due to the amortization of the property specific mortgages, primarily related to the Plainfield and LTI properties; (9) a $1.4 million decrease in interest expense related to the KeyBank credit facility, which was fully paid off in February 2014; and (10) a $0.1 million decrease in interest expense related to the KeyBank bridge loan, which was terminated during the three months ended December 31, 2013.

Funds from Operations and Modified Funds from Operations

Our management believes that historical cost accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or

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fallen with market conditions, many industry investors and analysts have considered the presentation of operating results for real estate companies that use historical cost accounting to be insufficient. Additionally, publicly registered, non-listed REITs typically have a significant amount of acquisition activity and are substantially more dynamic during their initial years of investment and operation. While other start-up entities may also experience significant acquisition activity during their initial years, we believe that non-listed REITs are unique in that they have a limited life with targeted exit strategies within a relatively limited time frame after the acquisition activity ceases.

In order to provide a more complete understanding of the operating performance of a REIT, the National Association of Real Estate Investment Trusts (“NAREIT”) promulgated a measure known as funds from operations (“FFO”). FFO is defined as net income or loss computed in accordance with GAAP, excluding extraordinary items, as defined by GAAP, and gains and losses from sales of depreciable operating property, adding back asset impairment write-downs, plus real estate related depreciation and amortization (excluding amortization of deferred financing costs and depreciation of non-real estate assets), and after adjustment for unconsolidated partnerships, joint ventures and preferred distributions. Because FFO calculations exclude such items as depreciation and amortization of real estate assets and gains and losses from sales of operating real estate assets (which can vary among owners of identical assets in similar conditions based on historical cost accounting and useful-life estimates), they facilitate comparisons of operating performance between periods and between other REITs. As a result, we believe that the use of FFO, together with the required GAAP presentations, provides a more complete understanding of our performance relative to our competitors and a more informed and appropriate basis on which to make decisions involving operating, financing, and investing activities. It should be noted, however, that other REITs may not define FFO in accordance with the current NAREIT definition or may interpret the current NAREIT definition differently than we do, making comparisons less meaningful.

The IPA issued Practice Guideline 2010-01 (the “IPA MFFO Guideline”) on November 2, 2010, which extended financial measures to include modified funds from operations (“MFFO”). In computing MFFO, FFO is adjusted for certain non-operating cash items such as acquisition fees and expenses and certain non-cash items such as straight-line rent, amortization of in-place lease valuations, amortization of discounts and premiums on debt investments, nonrecurring impairments of real estate-related investments, mark-to-market adjustments included in net income (loss), and nonrecurring gains or losses included in net income (loss) from the extinguishment or sale of debt, hedges, foreign exchange, derivatives or securities holdings where trading of such holdings is not a fundamental attribute of the business plan, unrealized gains or losses resulting from consolidation from, or deconsolidation to, equity accounting, and after adjustments for consolidated and unconsolidated partnerships and joint ventures, with such adjustments calculated to reflect MFFO on the same basis. Management is responsible for managing interest rate, hedge and foreign exchange risk. To achieve our objectives, we may borrow at fixed rates or variable rates. In order to mitigate our interest rate risk on certain financial instruments, if any, we may enter into interest rate cap agreements or other hedge instruments and in order to mitigate our risk to foreign currency exposure, if any, we may enter into foreign currency hedges. We view fair value adjustments of derivatives, impairment charges and gains and losses from dispositions of assets as non-recurring items or items which are unrealized and may not ultimately be realized, and which are not reflective of on-going operations and are therefore typically adjusted for when assessing operating performance. Additionally, we believe it is appropriate to disregard impairment charges, as this is a fair value adjustment that is largely based on market fluctuations, assessments regarding general market conditions, and the specific performance of properties owned, which can change over time. No less frequently than annually, we evaluate events and changes in circumstances that could indicate that the carrying amounts of real estate and related intangible assets may not be recoverable. When indicators of potential impairment are present, we assess whether the carrying value of the assets will be recovered through the future undiscounted operating cash flows (including net rental and lease revenues, net proceeds on the sale of the property, and any other ancillary cash flows at a property or group level under GAAP) expected from the use of the assets and the eventual disposition. Investors should note, however, that determinations of whether impairment charges have been incurred are based partly on anticipated operating performance, because estimated undiscounted future cash flows from a property, including estimated future net rental and lease revenues, net proceeds on the sale of the property, and certain other ancillary cash flows, are taken into account in determining whether an impairment charge has been incurred. While impairment charges are excluded from the calculation of MFFO as described above, investors are cautioned that due to the fact that impairments are based on estimated future undiscounted cash flows and the relatively limited term of our operations, it could be difficult to recover any impairment charges through operational net revenues or cash flows prior to any liquidity event.

We adopted the IPA MFFO Guideline as management believes that MFFO is a beneficial indicator of our on-going portfolio performance and ability to sustain our current distribution level. More specifically, MFFO isolates the financial results of the REIT’s operations. MFFO, however, is not considered an appropriate measure of historical earnings as it excludes certain significant costs that are otherwise included in reported earnings. Further, since the measure is based on historical financial information, MFFO for the period presented may not be indicative of future results or our future ability to pay our dividends. By providing FFO and MFFO, we present information that assists investors in aligning their analysis with management’s analysis of long-term operating activities. MFFO also allows for a comparison of the performance of our portfolio with other

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REITs that are not currently engaging in acquisitions, as well as a comparison of our performance with that of other non-traded REITs, as MFFO, or an equivalent measure, is routinely reported by non-traded REITs, and we believe often used by analysts and investors for comparison purposes. As explained below, management’s evaluation of our operating performance excludes items considered in the calculation of MFFO based on the following economic considerations:

• Straight-line rent. Most of our leases provide for periodic minimum rent payment increases throughout the term of the lease. In accordance with GAAP, these periodic minimum rent payment increases during the term of a lease are recorded to rental revenue on a straight-line basis in order to reconcile the difference between accrual and cash basis accounting. As straight-line rent is a GAAP non-cash adjustment and is included in historical earnings, FFO is adjusted for the effect of straight-line rent to arrive at MFFO as a means of determining operating results of our portfolio.

• Amortization of in-place lease valuation. Acquired in-place leases are valued as above-market or below-market as of the date of acquisition based on the present value of the difference between (a) the contractual amounts to be paid pursuant to the in-place leases and (b) management's estimate of fair market lease rates for the corresponding in-place leases over a period equal to the remaining non-cancelable term of the lease for above-market leases. The above-market and below-market lease values are capitalized as intangible lease assets or liabilities and amortized as an adjustment to rental income over the remaining terms of the respective leases. As this item is a non-cash adjustment and is included in historical earnings, FFO is adjusted for the effect of the amortization of in-place lease valuation to arrive at MFFO as a means of determining operating results of our portfolio.

• Acquisition-related costs. We were organized primarily with the purpose of acquiring or investing in income-producing real property in order to generate operational income and cash flow that will allow us to provide regular cash distributions to our stockholders. In the process, we incur non-reimbursable affiliated and non-affiliated acquisition-related costs, which in accordance with GAAP, are expensed as incurred and are included in the determination of income (loss) from operations and net income (loss). These costs have been and will continue to be funded with cash proceeds from our Primary Public Offerings or included as a component of the amount borrowed to acquire such real estate. If we acquire a property after all offering proceeds from our Public Offerings have been invested, there will not be any offering proceeds to pay the corresponding acquisition-related costs. Accordingly, unless our Advisor determines to waive the payment of any then-outstanding acquisition-related costs otherwise payable to our Advisor, such costs will be paid from additional debt, operational earnings or cash flow, net proceeds from the sale of properties, or ancillary cash flows. In evaluating the performance of our portfolio over time, management employs business models and analyses that differentiate the costs to acquire investments from the investments’ revenues and expenses. Acquisition-related costs may negatively affect our operating results, cash flows from operating activities and cash available to fund distributions during periods in which properties are acquired, as the proceeds to fund these costs would otherwise be invested in other real estate related assets. By excluding acquisition-related costs, MFFO may not provide an accurate indicator of our operating performance during periods in which acquisitions are made. However, it can provide an indication of our on-going ability to generate cash flow from operations and continue as a going concern after we cease to acquire properties on a frequent and regular basis, which can be compared to the MFFO of other non-listed REITs that have completed their acquisition activity and have similar operating characteristics to ours. Management believes that excluding these costs from MFFO provides investors with supplemental performance information that is consistent with the performance models and analysis used by management.

• Financed termination fee. We believe that a fee received from a tenant for terminating a lease is appropriately included as a component of rental revenue and therefore included in MFFO. If, however, the termination fee is to be paid over time, we believe the recognition of such termination fee into income should not be included in MFFO. Alternatively, we believe that the periodic amount paid by the tenant in subsequent periods to satisfy the termination fee obligation should be included in MFFO.

• Gain or loss from the extinguishment of debt. We use debt as a partial source of capital to acquire properties in our portfolio. As a term of obtaining this debt, we will pay financing costs to the respective lender. Financing costs are capitalized as a component of total assets on the consolidated balance sheets and amortized into interest expense on a straight-line basis over the term of the debt. We consider the amortization expense to be a component of operations if the debt was used to acquire properties. From time to time, we may cancel certain debt obligations and replace these canceled debt obligations with new debt at more favorable terms to us. In doing so, we are required to write off the remaining capitalized financing costs associated with the canceled debt, which we consider to be a cost, or loss, on extinguishing such debt. Management will no longer consider the effect of amortization of these financing costs in operating models and also believes that this loss is considered an isolated event not associated with our operations, and therefore, deems this write off to be an exclusion from MFFO.

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• Preferred units redemption premium. Preferred units were issued as a partial source of capital to acquire properties. As a term of the purchase agreement, we paid issuance costs to the investor that were capitalized as a component of equity on the consolidated balance sheets. Further, the purchase agreement allows us to exercise our right to redeem the outstanding preferred units, and, in doing so, we will be obligated to pay a redemption fee. In conjunction with the redemption, GAAP requires us to write off the issuance costs on a proportional basis of the redeemed preferred units to the total amount of preferred units issued. The write off of the issuance costs would be reflected on the statement of operations as a loss due to preferred unit redemptions. Management believes the loss, similar to the extinguishment of debt, is considered an isolated event not associated with our continuing operations, and therefore, deems it an exclusion from MFFO.

For all of these reasons, we believe the non-GAAP measures of FFO and MFFO, in addition to income (loss) from operations, net income (loss) and cash flows from operating activities, as defined by GAAP, are helpful supplemental performance measures and useful to investors in evaluating the performance of our real estate portfolio. However, a material limitation associated with FFO and MFFO is that they are not indicative of our cash available to fund distributions since other uses of cash, such as capital expenditures at our properties and principal payments of debt, are not deducted when calculating FFO and MFFO. Additionally, MFFO has limitations as a performance measure in an offering such as ours where the price of a share of common stock is a stated value. The use of MFFO as a measure of long-term operating performance on value is also limited if we do not continue to operate under our current business plan as noted above. MFFO is useful in assisting management and investors in assessing our on-going ability to generate cash flow from operations and continue as a going concern in future operating periods, and in particular, after the offering and acquisition stages are complete and NAV is disclosed. However, MFFO is not a useful measure in evaluating NAV because impairments are taken into account in determining NAV but not in determining MFFO. Therefore, FFO and MFFO should not be viewed as more prominent a measure of performance than income (loss) from operations, net income (loss) or to cash flows from operating activities and each should be reviewed in connection with GAAP measurements.

Neither the SEC, NAREIT, nor any other applicable regulatory body has opined on the acceptability of the adjustments contemplated to adjust FFO in order to calculate MFFO and its use as a non-GAAP performance measure. In the future, the SEC or NAREIT may decide to standardize the allowable exclusions across the REIT industry, and we may have to adjust the calculation and characterization of this non-GAAP measure.

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Our calculation of FFO and MFFO is presented in the following table for the years ended December 31, 2015, 2014 and 2013 (in thousands):

	Year Ended December 31,
	2015			2014			2013
Net income (loss)	$	15,621		$	14		$	(24,469	)
Adjustments:
Depreciation of building and improvements	43,320			27,694			10,093
Amortization of leasing costs and intangibles	69,400			45,187			14,098
Equity interest of depreciation of building and improvements - unconsolidated entities	2,472			853			42
Equity interest of amortization of intangible assets - unconsolidated entities	4,799			1,643			47
Gain from sale of depreciable operating property	(13,813		)	(3,104		)	—
FFO/(FFO deficit)	$	121,799		$	72,287		$	(189	)
Distributions to redeemable preferred unit holders	(9,245		)	(19,011		)	(2,969		)
Distributions to noncontrolling interests	(3,518		)	(3,419		)	(3,097		)
Preferred units redemption premium	(9,905		)	—			—
FFO/(FFO deficit), adjusted for redeemable preferred and noncontrolling interest distributions	$	99,131		$	49,857		$	(6,255	)
Reconciliation of FFO to MFFO:
Adjusted FFO/(FFO deficit)	$	99,131		$	49,857		$	(6,255	)
Adjustments:
Acquisition fees and expenses to non-affiliates	2,730			4,261			4,639
Acquisition fees and expenses to affiliates	32,245			24,319			24,849
Equity interest of acquisition fees and expenses to non-affiliates - unconsolidated entities	—			826			120
Revenues in excess of cash received (straight-line rents)	(13,792		)	(11,563		)	(3,515		)
Amortization of above/(below) market rent	(3,785		)	(468		)	(546		)
Amortization of ground leasehold interests (below market)	28			26			—
Revenues in excess of cash received	(2,078		)	(7,125		)	—
Financed termination fee payments received	1,061			1,050			—
Loss on extinguishment of debt - write-off of deferred financing costs	1,367			1,755			—
Equity interest of revenues in excess of cash received (straight-line rents) - unconsolidated entities	(1,155		)	(615		)	(17		)
Equity interest of amortization of above/(below) market rent - unconsolidated entities	3,000			1,014			15
Gain from discount on investment in unconsolidated entities	—			—			(160		)
Preferred units redemption premium	9,905			—			—
MFFO	$	128,657		$	63,337		$	19,130

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Liquidity and Capital Resources

Long-Term Liquidity and Capital Resources

On a long-term basis, our principal demands for funds will be for the payment of operating and capital expenses, including costs associated with re-leasing a property, distributions, and for the payment of debt service on our outstanding indebtedness, including repayment of the Unsecured Credit Facility (July 2015) and property secured mortgage loans discussed below, and other investments. Generally, cash needs for items, other than property acquisitions, will be met from operations. Our Advisor will evaluate potential additional property acquisitions and engage in negotiations with sellers on our behalf. After a purchase contract is executed that contains specific terms, the property will not be purchased until the successful completion of due diligence, which includes review of the title insurance commitment, an appraisal and an environmental analysis. In some instances, the proposed acquisition will require the negotiation of final binding agreements, which may include financing documents. During this period, we may decide to repay debt as allowed under the loan agreements or temporarily invest in certain investments that could yield lower returns than the properties. These lower returns may affect our ability to make distributions.

Unsecured Credit Facility (May 2014)

On May 8, 2014, we, through our Operating Partnership, entered into an unsecured credit agreement (the "Unsecured Credit Agreement (May 2014)") co-led by KeyBank National Association ("KeyBank") and Bank of America, N.A. ("Bank of America") with KeyBank as administrative agent and Bank of America as syndication agent, along with a syndicate of lenders. Pursuant to the Unsecured Credit Agreement (May 2014), we were provided with a $750.0 million senior unsecured credit facility (the "Unsecured Credit Facility (May 2014)"), consisting of a $450.0 million senior unsecured revolver (the "Unsecured Revolver (May 2014)") and a $300.0 million senior unsecured term loan (the "Unsecured Term Loan (May 2014)"). The Unsecured Credit Facility (May 2014) could be increased up to $500.0 million for a maximum of $1.25 billion by increasing the Unsecured Revolver (May 2014), the Unsecured Term Loan (May 2014) or a combination of both.

The Unsecured Credit Facility (May 2014) was retired in full on July 20, 2015, and we entered into the Unsecured Credit Facility (July 2015).

Unsecured Credit Facility (July 2015)

On July 20, 2015, we, through our Operating Partnership, entered into a credit agreement (the "Unsecured Credit Agreement (July 2015)") with a syndicate of lenders, co-led by KeyBank, Bank of America, Fifth Third Bank ("Fifth Third"), and BMO Harris Bank, N.A. ("BMO Harris"), under which KeyBank serves as administrative agent and Bank of America, Fifth Third, and BMO Harris serve as co-syndication agents, and KeyBanc Capital Markets ("KeyBank Capital Markets"), Merrill Lynch, Pierce, Fenner & Smith Incorporated ("Merrill Lynch"), Fifth Third, and BMO Capital Markets serve as joint bookrunners and joint lead arrangers. Pursuant to the Unsecured Credit Agreement (July 2015), we were provided with a $1.14 billion senior unsecured credit facility (the "Unsecured Credit Facility (July 2015)"), consisting of a $500.0 million senior unsecured revolver (the "Revolver Loan (July 2015)") and a $640.0 million senior unsecured term loan (the "Term Loan (July 2015)"). The Unsecured Credit Facility (July 2015) may be increased up to $860.0 million, in minimum increments of $50.0 million, for a maximum of $2.0 billion by increasing either the Revolver Loan (July 2015), the Term Loan (July 2015), or both. The Revolver Loan (July 2015) has an initial term of four years, maturing on July 20, 2019, and may be extended for a one-year period if certain conditions are met and upon payment of an extension fee. The Term Loan (July 2015) has a term of five years, maturing on July 20, 2020.

The Unsecured Credit Facility (July 2015) has an interest rate calculated based on LIBO Rate plus the applicable LIBO Rate margin or Base Rate plus the applicable Base Rate margin, both as provided in the Unsecured Credit Agreement (July 2015). The applicable LIBO Rate margin and Base Rate margin are dependent on whether the interest rate is calculated prior to or after we have received an investment grade senior unsecured credit rating of BBB-/Baa3 from Standard & Poors, Moody's, or Fitch, and we have elected to utilize the investment grade pricing list, as provided in the Unsecured Credit Agreement (July 2015). Otherwise, the applicable LIBO Rate margin will be based on a leverage ratio computed in accordance with our quarterly compliance package and communicated to KeyBank. The Base Rate is calculated as the greater of (i) the KeyBank Prime rate or (ii) the Federal Funds rate plus 0.50%. Payments under the Unsecured Credit Facility (July 2015) are interest only and are due on the first day of each quarter.

Highway 94 Mortgage Loan

On November 6, 2015, we assumed a $19.0 million mortgage loan (the "Highway 94 mortgage loan") from Wells Fargo Bank Northwest, N.A., and Teachers Insurance and Annuity Association, as participating holder of the note. The Highway 94 mortgage loan matures on August 1, 2024, has a fixed interest rate of 3.75%, and requires monthly payments of principal and interest.

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DynCorp Mortgage Loan, Mercedes-Benz Mortgage Loan, and Samsonite Mortgage Loan

On December 11, 2015, we, through three wholly-owned subsidiaries of the Operating Partnership, assumed the following three mortgage loans related to the acquisition of the following three properties:

• DynCorp - Approximately $11.2 million, secured by the DynCorp property (the "DynCorp mortgage loan"). The DynCorp mortgage loan has a fixed interest rate of 4.70%, matures in July 2016, and requires monthly principal and interest payments.

• Mercedes-Benz - Approximately $18.9 million, secured by the Mercedes-Benz property (the "Mercedes-Benz mortgage loan"). The Mercedes-Benz mortgage loan has a fixed interest rate of 6.018%, matures in November 2016, and requires monthly principal and interest payments.

• Samsonite - Approximately $24.6 million, secured by the Samsonite property (the "Samsonite mortgage loan"). The Samsonite mortgage loan has a fixed interest rate of 6.08%, matures in September 2023, and requires monthly principal and interest payments.

Other Potential Future Sources of Capital

Other potential future sources of capital include proceeds from potential private or public offerings of our stock or limited partnership units of our Operating Partnership, proceeds from secured or unsecured financings from banks or other lenders, including debt assumed in a real estate acquisition transaction, proceeds from the sale of properties and undistributed funds from operations. If necessary, we may use financings or other sources of capital in the event of unforeseen significant capital expenditures. To the extent we are not able to secure additional financing in the form of a credit facility or other third party source of liquidity, we will be heavily dependent upon our current financing, our 2015 DRP Offering and our income from operations.

Contractual Commitments and Contingencies

The following is a summary of our contractual obligations as of December 31, 2015 (in thousands):

	Payments Due During the Years Ending December 31,
	Total		2016			2017-2018			2019-2020			Thereafter
Outstanding debt obligations (1)	$	1,485,516	$	40,078	(4)	$	29,314	(5)	$	1,153,639	(6)	$	262,485	(7)
Interest on outstanding debt obligations (2)	210,307		33,985			63,396			55,918			57,008
Interest rate swaps (3)	39,238		9,772			19,618			9,848			—
Ground lease obligations	35,020		180			396			396			34,048
Total	$	1,770,081	$	84,015		$	112,724		$	1,219,801		$	353,541

(1) Amounts only include principal payments. Mortgage debt does not include the premiums or discount related to four properties of $0.8 million, net premium.

(2) Projected interest payments are based on the outstanding principal amounts at December 31, 2015. Projected interest payments on the Revolver Loan (July 2015) and Term Loan (July 2015) are based on the contractual interest rate in effect at December 31, 2015.

(3) The interest rate swaps contractual commitment was calculated based on the swap rate less the LIBO rate.

(4) Amount includes payment of the balances of the TransDigm, DynCorp, and Mercedes-Benz property mortgage loans, which mature in 2016.

(5) Amount includes payment of the balance of the Plainfield property mortgage, which matures in 2017.

(6) Amount includes payment of the balance of the TW Telecom loan, which matures in 2019. Amount also includes payment of the Term Loan (July 2015), which matures in 2020 and the Revolver Loan (July 2015), which matures in 2020, assuming the one-year extension is exercised.

(7) Amount includes payment of the balances of:

•the Midland Mortgage, Emporia Partners, and Samsonite property mortgage loans, all of which mature in 2023,

•the Ace Hardware and Highway 94 property mortgage loans, which mature in 2024, and

•the AIG loan, which matures in 2029.

Short-Term Liquidity and Capital Resources

We expect to meet our short-term operating liquidity requirements with operating cash flows generated from our properties and other properties we acquire in the future. All advances from our Advisor will be repaid, without interest, as funds are available after meeting our current liquidity requirements, subject to the limitations on reimbursement.

Our cash and cash equivalent balances decreased by approximately $47.0 million during the year ended December 31, 2015 and were used in or provided by the following:

Operating Activities. During the year ended December 31, 2015, we generated $92.5 million of net cash from operating activities compared to $73.2 million generated during the same period in 2014. Net cash provided by operating activities before changes in operating assets and liabilities for the year ended December 31, 2015 increased by $39.8 million to

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$96.7 million compared to $56.9 million for the year ended December 31, 2014. The increase is primarily related to the acquisition of 35 properties from January 1, 2014 through December 31, 2015, partially offset by the sale of four non-strategic properties over the same period.

Investing Activities. During the year ended December 31, 2015, we used $414.4 million in cash for investing activities, compared to $757.9 million used during the same period in 2014. The $343.5 million decrease in cash used in investing activities is related to the following:

• $260.2 million decrease in cash used to acquire properties;

• $68.4 million decrease for the investment in an unconsolidated entity;

• $7.5 million decrease related to the investment in a land development joint venture, of which there was none in the current period;

• $5.9 million increase in distributions from the investment in unconsolidated entities primarily related to the Digital Realty joint venture, which was entered into on September 9, 2014;

• $8.6 million in cash assumed through the SOR Merger;

• $80.2 million increase in proceeds related to the sale of three properties during the year ended December 31, 2015 compared to the sale of one property during the prior year;

• $2.5 million in reserves for tenant improvements primarily related to the SoftBank property, which was written off as a result of the lease termination effective August 31, 2015; offset by

• $26.8 million increase related to the proceeds held by a third party intermediary from the sale of the Will Partners and LTI properties, as discussed in Note 3, Real Estate, to the consolidated financial statements, which will be released upon completion of the tax-deferred real estate exchange, as permitted by Section 1031 of the Internal Revenue Code;

• $34.6 million increase related to payments for construction-in-progress and tenant improvements;

• $24.2 million in a mortgage receivable to a related party as discussed in Note 9, Related Party Transactions; and

• $4.1 million in acquisition deposits applied during the year ended December 31, 2014.

Financing Activities. During the year ended December 31, 2015, we generated $274.9 million in financing activities compared to $743.2 million generated during the same period in 2014, a decrease in cash provided by financing activities of approximately $468.3 million which is comprised of the following:

• $710.8 million decrease in proceeds from the issuance of common stock and noncontrolling interest, net of the decrease in offering costs and repurchases of common stock, during the year ended December 31, 2015;

• $518.1 million increase in principal payoff of secured indebtedness, including the SOR credit facility, net of the decrease of deferred financing costs and financing deposits;

• $21.6 million increase in distribution payments to common stockholders and noncontrolling interest due to an increase in shares issued;

• $254.5 million for the preferred units repurchase; offset by

• $8.2 million decrease in distributions paid on preferred units as a result of the full redemption during the current year; and

• $1.0 billion net increase in proceeds from borrowings related to the Unsecured Revolver (May 2014), Term Loan (July 2015), and Revolver Loan (July 2015) during the year ended December 31, 2015 offset by proceeds from borrowings related to the KeyBank credit facility, AIG loan, and TW Telecom loan during the same period in the prior year.

Distributions and Our Distribution Policy

Distributions will be paid to our stockholders as of the record date selected by our board of directors. We expect to continue to pay distributions monthly based on daily declaration and record dates. We expect to pay distributions regularly unless our results of operations, our general financial condition, general economic conditions, or other factors inhibit us from doing so. Distributions will be authorized at the discretion of our board of directors, which will be directed, in substantial part, by its obligation to cause us to comply with the REIT requirements of the Internal Revenue Code. The funds we receive from operations that are available for distribution may be affected by a number of factors, including the following:

• our operating and interest expenses;

• the amount of distributions or dividends received by us from our indirect real estate investments;

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• our ability to keep our properties occupied;

• our ability to maintain or increase rental rates;

• tenant improvements, capital expenditures, and reserves for such expenditures;

• the issuance of additional shares; and

• debt maturity, financings, and refinancings.

Distributions may be funded with operating cash flow from our properties, offering proceeds raised in future public offerings (if any), or a combination thereof. For the year ended December 31, 2015, we funded 90% of our cash distributions from cash flows provided by operating activities and 10% from offering proceeds. To the extent that we do not have taxable income, distributions paid will be considered a return of capital to stockholders. The following table shows distributions declared, distributions paid, and cash flow provided by operating activities during the year ended December 31, 2015:

					Distributions Paid (3)
Period	Distributions Declared (1) (4)		Distributions Declared Per Common Share (1)(2)		Cash (4)		Reinvested		Total		Cash Flow from Operating Activities
First Quarter 2015	$	27,794	$	0.17	$	14,819	$	12,896	$	27,715	$	18,518
Second Quarter 2015	$	31,526	$	0.17	$	18,099	$	13,055	$	31,154	$	14,287
Third Quarter 2015	$	33,627	$	0.17	$	18,452	$	13,303	$	31,755	$	31,400
Fourth Quarter 2015	$	37,323	$	0.17	$	25,277	$	13,303	$	38,580	$	29,093

(1) Distributions for the period from January 1, 2015 through December 31, 2015 were based on daily record dates and were calculated at a rate of $0.001901096 per share per day.

(2) Assumes shares were issued and outstanding each day during the period presented.

(3) Distributions for all record dates of a given month are paid on a monthly basis, on or about the first business day of the following month.

(4) Includes distributions paid to noncontrolling interests and preferred unit holders, including the liquidation preference related to the redemption of the preferred units on May 14, 2015 and November 5, 2015.

For the year ended December 31, 2015, we paid and declared distributions of approximately $107.6 million to common stockholders including shares issued pursuant to the DRP, and approximately $22.7 million to the limited partners of our Operating Partnership, including those distributions paid to the preferred unit holders, as compared to FFO, adjusted for redeemable preferred and noncontrolling interest distributions, and MFFO to common stockholders for the year ended December 31, 2015 of $99.1 million and $128.7 million, respectively. The payment of distributions from sources other than FFO or MFFO may reduce the amount of proceeds available for investment and operations or cause us to incur additional interest expense as a result of borrowed funds.

Off-Balance Sheet Arrangements

As of December 31, 2015, we had no off-balance sheet transactions, nor do we currently have any such arrangements or obligations.

Subsequent Events

See Note 13, Subsequent Events, to the consolidated financial statements.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risks include risks that arise from changes in interest rates, foreign currency exchange rates, commodity prices, equity prices and other market changes that affect market-sensitive instruments. We expect that the primary market risk to which we will be exposed is interest rate risk, including the risk of changes in the underlying rates on our variable rate debt.

In order to modify and manage the interest rate characteristics of our outstanding debt and to limit the effects of interest rate risks on our operations, we may utilize a variety of financial instruments, including interest rate swap agreements, caps, floors, and other interest rate exchange contracts. The use of these types of instruments to hedge a portion of our exposure to changes in interest rates carries additional risks, such as counterparty credit risk and the legal enforceability of hedging contracts.

Our future earnings and fair values relating to financial instruments are primarily dependent upon prevalent market rates of interest, such as LIBO Rate. However, our interest rate swap agreements are intended to reduce the effects of interest rate changes. The following table illustrates the effect of a 1% increase in interest rates, assuming a LIBO Rate floor of 0%, on our

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variable-rate debt, including our unsecured credit facility and mortgage loans, after considering the effect of our interest rate swap agreements, secured debt, and unsecured senior notes payable as of December 31, 2015 (in thousands):

Impact of future earnings due to variable-rate debt
Rate increase of 1%	$	(5,504	)
Effect of fair value of total consolidated debt and interest rate swap agreements
Rate increase of 1%	$	(357	)

These amounts are determined by considering the impact of the hypothetical interest rates on our borrowing cost and our interest rate swap agreements in effect as of December 31, 2015. These analyses do not consider the effects of the reduced level of overall economic activity that could exist in such an environment. Further, in the event of a change of such magnitude, we would consider taking actions to further mitigate our exposure to the change. However, because of the uncertainty of the specific actions that would be taken and their possible effects, the sensitivity analyses assume no changes in our capital structure.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The financial statements and supplementary data filed as part of this annual report are set forth beginning on page F-1 of this report.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

There were no changes in or disagreements with our independent registered public accountant during the years ended December 31, 2015 and 2014.

ITEM 9A. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As of the end of the period covered by this report, management, with the participation of our principal executive and principal financial officers, including our chief executive officer and chief financial officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures. Based upon, and as of the date of, the evaluation, our chief executive officer and chief financial officer concluded that the disclosure controls and procedures were effective as of the end of the period covered by this report to ensure that information required to be disclosed in the reports we file and submit under the Securities Exchange Act of 1934 (the “Exchange Act”) is recorded, processed, summarized and reported as and when required. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports we file and submit under the Exchange Act is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for us. Our management, including our chief executive officer and chief financial officer, evaluated, as of December 31, 2015, the effectiveness of our internal control over financial reporting using the framework in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 1992. Based on that evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, 2015.

There have been no changes in our internal control over financial reporting that occurred during the quarter ended December 31, 2015 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

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(a) During the quarter ended December 31, 2015, there was no information required to be disclosed in a report on Form 8-K which was not disclosed in a report on Form 8-K.

(b) During the quarter ended December 31, 2015, there were no material changes to the procedures by which security holders may recommend nominees to our board of directors.

PART III

We expect to file a definitive proxy statement for our 2016 Annual Meeting of Stockholders (the “2016 Proxy Statement”) with the SEC, pursuant to Regulation 14A, not later than 120 days after the end of our fiscal year. Accordingly, certain information required by Part III has been omitted under General Instruction G(3) to Form 10-K and is incorporated by reference to the 2016 Proxy Statement. Only those sections of the 2016 Proxy Statement that specifically address the items required to be set forth herein are incorporated by reference.

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by this Item is incorporated by reference to the 2016 Proxy Statement to be filed with the SEC.

ITEM 11. EXECUTIVE COMPENSATION

The information required by this Item is incorporated by reference to the 2016 Proxy Statement to be filed with the SEC.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information required by this Item is incorporated by reference to the 2016 Proxy Statement to be filed with the SEC.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

The information required by this Item is incorporated by reference to the 2016 Proxy Statement to be filed with the SEC.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

The information required by this Item is incorporated by reference to the 2016 Proxy Statement to be filed with the SEC.

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a) List of Documents Filed.

1. The list of the financial statements contained herein is set forth on page F-1 hereof.

2. Schedule III — Real Estate and Accumulated Depreciation is set forth beginning on page S-1 hereof. All other schedules for which provision is made in the applicable accounting regulations of the SEC are not required under the related instructions or are not applicable and therefore have been omitted.

3. The Exhibits filed in response to Item 601 of Regulation S-K are listed on the Exhibit Index below.

(b) See (a) 3 above.

(c) See (a) 2 above.

EXHIBIT INDEX

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The following exhibits are included in this Annual Report on Form 10-K for the year ended December 31, 2015 (and are numbered in accordance with Item 601 of Regulation S-K).

Exhibit No.	Description
3.1	Third Articles of Amendment and Restatement of Griffin Capital Essential Asset REIT, Inc., incorporated by reference to Exhibit 3.1 to Pre-Effective Amendment No. 3 to the Registrant’s Registration Statement on Form S-11, filed on October 29, 2009, Commission File No. 333-159167
3.2	Bylaws of Griffin Capital Essential Asset REIT, Inc., incorporated by reference to Exhibit 3.2 to the Registrant’s Registration Statement on Form S-11, filed on May 12, 2009, Commission File No. 333-159167
3.3	Articles of Amendment to Third Articles of Amendment and Restatement of Griffin Capital Essential Asset REIT, Inc., incorporated by reference to Exhibit 3.3 to Post-Effective Amendment No. 6 to the Registrant’s Registration Statement on Form S-11, filed on July 12, 2011, Commission File No. 333-159167
3.4	Second Articles of Amendment to the Third Articles of Amendment and Restatement of Griffin Capital Essential Asset REIT, Inc., incorporated by reference to Exhibit 3.1 to the Registrant’s current report on Form 8-K filed on February 25, 2013, Commission File No. 000-54377
3.5	Third Articles of Amendment to the Third Articles of Amendment and Restatement of Griffin Capital Essential Asset REIT, Inc., incorporated by reference to Exhibit 3.1 to the Registrant’s current report on Form 8-K filed on June 14, 2013, Commission File No. 000-54377
4.1	Griffin Capital Essential Asset REIT, Inc. Second Amended and Restated Distribution Reinvestment Plan, incorporated by reference to Appendix B to the prospectus contained in the Registrant's Registration Statement on Form S-3D, filed on September 22, 2015, Commission File No. 333-207075
4.2	Enrollment form for Distribution Reinvestment Plan, incorporated by reference to Appendix A to the prospectus contained in the Registrant's Registration Statement on Form S-3D, filed on September 22, 2015, Commission File No. 333-207075
10.1	Griffin Capital Essential Asset REIT, Inc. 2009 Long Term Incentive Plan, incorporated by reference to Exhibit 10.3 to the Registrant’s Registration Statement on Form S-11, filed on May 12, 2009, Commission File No. 333-159167
10.2	Tax Protection Agreement by and among Griffin Capital Essential Asset REIT, Inc., Griffin Capital Essential Asset Operating Partnership, L.P., Kevin A. Shields, Don G. Pescara and David C. Rupert, incorporated by reference to Exhibit 10.5 to the Registrant’s Registration Statement on Form S-11, filed on May 12, 2009, Commission File No. 333-159167
10.3	Form of Master Property Management, Leasing and Construction Management Agreement, incorporated by reference to Exhibit 10.6 to the Registrant’s Quarterly Report on Form 10-Q, filed on December 10, 2009, Commission File No. 333-159167
10.4	Fixed Rate Note for Plainfield Property, incorporated by reference to Exhibit 10.17 to the Registrant’s Annual Report on Form 10-K, filed on March 30, 2010, Commission File No. 333-159167
10.5	Tax Protection Agreement for Will Partners Property dated June 4, 2010, incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K, filed on June 9, 2010, Commission File No. 333-159167
10.6	Tax Protection Agreement for LTI Property dated May 13, 2011, incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, filed on May 16, 2011, Commission File No. 000-54377
10.7	Promissory Note dated February 27, 2013 issued to Midland National Life Insurance Company, incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed on March 5, 2013, Commission File No. 000-54377
10.8	Open End Mortgage and Security Agreement for Westinghouse Property dated February 27, 2013, incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, filed on March 5, 2013, Commission File No. 000-54377
10.9	Separate Guaranty of Retained Liability Matters Agreement for Midland Mortgage Loan dated February 27, 2013, incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K, filed on March 5, 2013, Commission File No. 000-54377
10.10	NUF Note for the Schlumberger Property, incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed on January 30, 2014, Commission File No. 000-54377
10.11	VALIC Note for the Schlumberger Property, incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed on January 30, 2014, Commission File No. 000-54377
10.12	First Deed of Trust for the Schlumberger Property, incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed on January 30, 2014, Commission File No. 000-54377
10.13	Second Deed of Trust for the Schlumberger Property, incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed on January 30, 2014, Commission File No. 000-54377

64

Exhibit No.	Description
10.14	First Mortgage for the Verizon Property, incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed on January 30, 2014, Commission File No. 000-54377
10.15	Second Mortgage for the Verizon Property, incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed on January 30, 2014, Commission File No. 000-54377
10.16	Recourse Carve-Out Guaranty Agreement, incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed on January 30, 2014, Commission File No. 000-54377
10.17	Third Amended and Restated Advisory Agreement, incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K, filed on October 17, 2014, Commission File No. 000-54377
10.18	Third Amended and Restated Limited Partnership Agreement, incorporated by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K, filed on October 17, 2014, Commission File No. 000-54377
10.19	Agreement and Plan of Merger, dated as of November 21, 2014, by and among Griffin Capital Essential Asset REIT, Inc., Griffin SAS, LLC, and Signature Office REIT, Inc., incorporated by reference to Exhibit 2.1 to the Registrant's Current Report on Form 8-K, filed on November 24, 2014, Commission File No. 000-54377
10.20	Board Observer and Indemnification Agreement, incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed on June 11, 2015, Commission File No. 000-54377
10.21	DreamWorks Purchase Agreement, incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed on July 23, 2015, Commission File No. 000-54377
10.22	Unsecured Credit Agreement, incorporated by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K filed on July 23, 2015, Commission File No. 000-54377
10.23	Revolving Loan Note, incorporated by reference to Exhibit 10.3 to the Registrant's Current Report on Form 8-K filed on July 23, 2015, Commission File No. 000-54377
10.24	Term Loan Note, incorporated by reference to Exhibit 10.4 to the Registrant's Current Report on Form 8-K filed on July 23, 2015, Commission File No. 000-54377
10.25	Guaranty, incorporated by reference to Exhibit 10.5 to the Registrant's Current Report on Form 8-K filed on July 23, 2015, Commission File No. 000-54377
10.26	Schedule of Omitted Documents, incorporated by reference to Exhibit 10.6 to the Registrant's Current Report on Form 8-K filed on July 23, 2015, Commission File No. 000-54377
10.27*	First Amendment to Unsecured Credit Agreement dated February 12, 2016
21.1	Subsidiaries of Griffin Capital Essential Asset REIT, Inc., incorporated by reference to Exhibit 21.1 to the Registrant’s Registration Statement on Form S-4, filed on February 3, 2015, Commission File No. 333-201835
23.1*	Consent of Ernst & Young, LLP, Independent Registered Accounting Firm
31.1*	Certification of Principal Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*	Certification of Principal Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1*	Certification of Principal Executive Officer, pursuant to 18 U.S.C. Section 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002
32.2*	Certification of Principal Financial Officer, pursuant to 18 U.S.C. Section 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002
101*	The following Griffin Capital Essential Asset REIT, Inc. financial information for the year ended December 31, 2015, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Equity, (iv) Consolidated Statements of Cash Flows and (v) Notes to Consolidated Financial Statements.

* Filed herewith.

65

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of El Segundo, State of California, on March 10, 2016.

GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.
By:	/s/ Kevin A. Shields
	Kevin A. Shields
	Chief Executive Officer and Chairman

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated:

Signature	Title	Date
/s/ Kevin A. Shields	Chief Executive Officer and Chairman (Principal Executive Officer)	March 10, 2016
Kevin A. Shields
/s/ Joseph E. Miller	Chief Financial Officer and Treasurer (Principal Financial Officer)	March 10, 2016
Joseph E. Miller
/s/ Gregory M. Cazel	Independent Director	March 10, 2016
Gregory M. Cazel
/s/ Timothy J. Rohner	Independent Director	March 10, 2016
Timothy J. Rohner

66

GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm	F-2
Consolidated Balance Sheets as of December 31, 2015 and 2014	F-3
Consolidated Statements of Operations for the Years Ended December 31, 2015, 2014 and 2013	F-4
Consolidated Statements of Other Comprehensive Loss for the Year Ended December 31, 2015, 2014 and 2013	F-5
Consolidated Statements of Equity for the Years Ended December 31, 2015, 2014 and 2013	F-6
Consolidated Statements of Cash Flows for the Years Ended December 31, 2015, 2014 and 2013	F-7
Notes to Consolidated Financial Statements	F-8
Financial Statement Schedule
Schedule III- Real Estate Assets and Accumulated Depreciation and Amortization	S-1

All other schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto.

F-1

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of

Griffin Capital Essential Asset REIT, Inc.:

We have audited the accompanying consolidated balance sheets of Griffin Capital Essential Asset REIT, Inc. (the Company) as of December 31, 2015 and 2014, and the related consolidated statements of operations, comprehensive loss, equity, and cash flows for each of the three years in the period ended December 31, 2015. Our audits also included the financial statement schedule listed in the Index at Item 15. These financial statements and schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Griffin Capital Essential Asset REIT, Inc. at December 31, 2015 and 2014, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2015, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

As discussed in Note 2 to the consolidated financial statements, the Company changed its method for reporting discontinued operations effective January 1, 2014.

/s/ Ernst & Young LLP

Los Angeles, California

March 10, 2016

F-2

GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)

	December 31, 2015			December 31, 2014
ASSETS
Cash and cash equivalents	$	21,944		$	68,915
Restricted cash	24,187			40,752
Restricted cash - real estate funds held for exchange	47,031			10,105
Real estate:
Land	355,443			250,078
Building and improvements	2,020,947			1,178,751
Tenant origination and absorption cost	516,879			359,416
Construction in progress	4,805			35,650
Total real estate	2,898,074			1,823,895
Less: accumulated depreciation and amortization	(202,048		)	(102,883		)
Total real estate, net	2,696,026			1,721,012
Real estate assets and other assets held for sale, net	68,792			96,862
Investments in unconsolidated entities	56,863			66,249
Intangible assets, net	36,769			23,621
Deferred rent	26,432			15,619
Deferred financing costs, net	12,899			11,791
Mortgage receivable from affiliate	24,513			—
Other assets, net	34,833			10,521
Total assets	$	3,050,289		$	2,065,447
LIABILITIES AND EQUITY
Debt:
Mortgage payable, plus unamortized premium of $810 and $1,858, respectively	$	364,673		$	325,696
Unsecured term loan (May 2014)	—			300,000
Term Loan (July 2015)	640,000			—
Revolver Loan (July 2015)	481,653			—
Total debt	1,486,326			625,696
Restricted reserves	11,286			37,050
Interest rate swap liability	6,394			—
Mandatory redemption of noncontrolling interest	18,129			—
Accounts payable and other liabilities	68,168			41,518
Distributions payable	6,147			5,083
Due to affiliates	8,757			1,851
Below market leases, net	41,706			40,394
Liabilities of real estate assets held for sale	2,845			3,906
Total liabilities	1,649,758			755,498
Commitments and contingencies (Note 10)
Preferred units subject to redemption, nil and 24,319,066 units outstanding as of December 31, 2015 and 2014, respectively	—			250,000
Noncontrolling interests subject to redemption, 531,000 units eligible towards redemption as of December 31, 2015 and 2014	4,887			12,543
Common stock subject to redemption	86,557			56,421
Stockholders' Equity:
Preferred stock, $0.001 par value; 200,000,000 shares authorized; no shares outstanding, as of December 31, 2015 and 2014	—			—
Common stock, $0.001 par value; 700,000,000 shares authorized; 175,184,519 and 129,763,016 shares outstanding, as of December 31, 2015 and 2014, respectively	175			1,326
Additional paid-in capital	1,561,499			1,128,318
Cumulative distributions	(212,031		)	(104,429		)
Accumulated deficit	(55,035		)	(51,285		)
Accumulated other comprehensive loss	(6,839		)	(423		)
Total stockholders’ equity	1,287,769			973,507
Noncontrolling interests	21,318			17,478
Total equity	1,309,087			990,985
Total liabilities and equity	$	3,050,289		$	2,065,447

See accompanying notes.

F-3

GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share amounts)

	Year Ended December 31,
	2015			2014			2013
Revenue:
Rental income	$	235,148		$	164,412		$	54,605
Property expense recoveries	54,947			37,982			14,311
Total revenue	290,095			202,394			68,916
Expenses:
Asset management fees to affiliates	19,389			12,541			4,317
Property management fees to affiliates	7,622			5,445			1,839
Property operating expense	37,924			30,565			8,865
Property tax expense	34,733			24,873			8,061
Acquisition fees and expenses to non- affiliates	2,730			4,261			4,639
Acquisition fees and expenses to affiliates	32,245			24,319			24,849
General and administrative expenses	7,595			4,982			2,758
Depreciation and amortization	112,748			72,907			24,191
Total expenses	254,986			179,893			79,519
Income (loss) from operations	35,109			22,501			(10,603		)
Other income (expense):
Interest expense	(33,402		)	(24,598		)	(13,922		)
Interest income	1,576			365			2
Gain from investment in unconsolidated entities	—			—			160
Loss from investment in unconsolidated entities	(1,475		)	(1,358		)	(106		)
Gain from sale of depreciable operating property	13,813			3,104			—
Net income (loss)	15,621			14			(24,469		)
Distributions to redeemable preferred unit holders	(9,245		)	(19,011		)	(2,969		)
Preferred units redemption premium	(9,905		)	—			—
Less: Net loss attributable to noncontrolling interests	138			698			3,092
Net loss attributable to controlling interests	(3,391		)	(18,299		)	(24,346		)
Distributions to redeemable noncontrolling interests attributable to common stockholders	(359		)	(355		)	(318		)
Net loss attributable to common stockholders	$	(3,750	)	$	(18,654	)	$	(24,664	)
Net loss attributable to common stockholders per share, basic and diluted	$	(0.02	)	$	(0.17	)	$	(0.97	)
Weighted average number of common shares outstanding, basic and diluted	155,059,231			112,358,422			25,404,780

See accompanying notes.

F-4

GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE LOSS

(in thousands)

	Year Ended December 31,
	2015			2014			2013
Net income (loss)	$	15,621		$	14		$	(24,469	)
Other comprehensive loss:
Equity in other comprehensive loss of unconsolidated joint venture	(189		)	(423		)	—
Change in fair value of swap agreement	(6,371		)	—			—
Total comprehensive income (loss)	9,061			(409		)	(24,469		)
Distributions to redeemable preferred unit holders	(9,245		)	(19,011		)	(2,969		)
Preferred units redemption premium	(9,905		)	—			—
Distributions to redeemable noncontrolling interests attributable to common stockholders	(359		)	(355		)	(318		)
Less: other comprehensive loss attributable to noncontrolling interests	282			698			3,092
Net other comprehensive loss attributable to common stockholders	$	(10,166	)	$	(19,077	)	$	(24,664	)

See accompanying notes.

F-5

GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

CONSOLIDATED STATEMENTS OF EQUITY

(in thousands, except share amounts)

															Accumulated Other Comprehensive Loss
	Common Stock					Additional Paid-In Capital			Cumulative Distributions			Accumulated Deficit						Total Stockholders' Equity			Non-controlling Interests			Total Equity
	Shares		Amount
BALANCE December 31, 2012	13,376,868		$	134		$	112,794		$	(9,192	)	$	(7,967	)	—			$	95,769		$	17,512		$	113,281
Gross proceeds from issuance of common stock	35,666,880		366			365,285			—			—			—			365,650			—			365,650
Discount on issuance of common stock	—		—			(910		)	—			—			—			(910		)	—			(910		)
Offering costs including dealer manager fees to affiliates	—		—			(37,761		)	—			—			—			(37,761		)	—			(37,761		)
Distributions to common stockholders	—		—			—			(8,589		)	—			—			(8,589		)	—			(8,589		)
Issuance of shares for distribution reinvestment plan	912,214		9			8,893			(8,902		)	—			—			—			—			—
Repurchase of common stock	(62,460	)	(1		)	(614		)	—			—			—			(614		)	—			(614		)
Additions to common stock subject to redemption	—		—			(8,902		)	—			—			—			(8,902		)	—			(8,902		)
Contribution of noncontrolling interest	—		—			239			—			—			—			239			8,095			8,334
Distributions to noncontrolling interests	—		—			—			—			—			—			—			(2,730		)	(2,730		)
Distributions to noncontrolling interests subject to redemption	—		—			—			—			—			—			—			(49		)	(49		)
Offering costs on preferred equity	—		—			(5,380		)	—			—			—			(5,380		)	—			(5,380		)
Net loss	—		—			—			—			(24,664		)				(24,664		)	(3,092		)	(27,756		)
BALANCE December 31, 2013	49,893,502		$	508		$	433,644		$	(26,683	)	$	(32,631	)	$	—		$	374,838		$	19,736		$	394,574
Gross proceeds from issuance of common stock	75,545,500		776			775,831			—			—			—			776,607			—			776,607
Stock-based compensation	10,000		—			108			—			—			—			108			—			108
Discount on issuance of common stock	—		—			(1,885		)	—			—			—			(1,885		)	—			(1,885		)
Offering costs including dealer manager fees to affiliates	—		—			(76,638		)	—			—			—			(76,638		)	—			(76,638		)
Distributions to common stockholders	—		—			—			(32,799		)	—			—			(32,799		)	—			(32,799		)
Issuance of shares for distribution reinvestment plan	4,572,953		45			44,902			(44,947		)	—			—			—			—			—
Repurchase of common stock	(258,939	)	(3		)	(2,557		)	—			—						(2,560		)	—			(2,560		)
Additions to common stock subject to redemption	—		—			(44,947		)	—			—			—			(44,947		)	—			(44,947		)
Issuance of limited partnership units	—		—			(140		)	—			—			—			(140		)	1,504			1,364
Distributions to noncontrolling interests	—		—			—			—			—			—			—			(3,050		)	(3,050		)
Distributions to noncontrolling interests subject to redemption	—		—			—			—			—			—			—			(14		)	(14		)
Net loss	—		—			—			—			(18,654		)	(423		)	(19,077		)	(698		)	(19,775		)
BALANCE December 31, 2014	129,763,016		$	1,326		$	1,128,318		$	(104,429	)	$	(51,285	)	$	(423	)	$	973,507		$	17,478		$	990,985
Issuance of shares pursuant to Signature Office REIT merger	41,764,968		42			433,625			—			—			—			433,667			—			433,667
Adjustment to par value - common stock	—		(1,217		)	1,217			—			—			—			—			—			—
Adjustments to redemption value of redeemable noncontrolling interests	—		—			(10,473		)	—			—			—			(10,473		)	—			(10,473		)
Stock-based compensation	667		—			12			—			—			—			12			—			12
Offering costs	—		—			(62		)	—			—			—			(62		)	—			(62		)
Distributions to common stockholders	—		—			—			(55,045		)	—			—			(55,045		)	—			(55,045		)
Issuance of shares for distribution reinvestment plan	5,053,669		28			52,529			(52,557		)	—			—			—			—			—
Repurchase of common stock	(1,397,801	)	(4		)	(13,815		)	—			—						(13,819		)	—			(13,819		)
Additions to common stock subject to redemption	—		—			(35,232		)	—			—			—			(35,232		)	—			(35,232		)
Issuance of limited partnership units	—		—			—			—			—			—			—			7,282			7,282
Distributions to noncontrolling interests	—		—			—			—			—			—			—			(3,150		)	(3,150		)
Distributions to noncontrolling interests subject to redemption	—		—			—			—			—			—			—			(10		)	(10		)
Write-off of offering costs on redemption of preferred units	—		—			5,380			—			—			—			5,380			—			5,380
Net loss	—		—			—			—			(3,750		)	—			(3,750		)	(138		)	(3,888		)
Other comprehensive loss	—		—			—			—			—			(6,416		)	(6,416		)	(144		)	(6,560		)
BALANCE December 31, 2015	175,184,519		$	175		$	1,561,499		$	(212,031	)	$	(55,035	)	$	(6,839	)	$	1,287,769		$	21,318		$	1,309,087

See accompanying notes.

F-6

GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Year Ended December 31,
	2015			2014			2013
Operating Activities:
Net income (loss)	$	15,621		$	14		$	(24,469	)
Adjustments to reconcile net income (loss) to net cash provided by operations:
Depreciation of building and building improvements	43,320			27,694			10,093
Amortization of leasing costs and intangibles, including ground leasehold interests	69,428			45,213			14,098
Amortization of above and below market leases, net	(3,785		)	(468		)	(546		)
Amortization of deferred financing costs	3,764			3,853			1,943
Amortization of debt premium	(285		)	(255		)	(139		)
Amortization of deferred revenue	(282		)	—			—
Deferred rent	(13,792		)	(11,563		)	(3,515		)
Termination fee revenue - release of tenant obligation	(2,078		)	—			—
Termination fee revenue receivable from tenant, net	(2,904		)	(5,937		)	—
Gain from sale of depreciable operating property	(13,813		)	(3,104		)	—
Unrealized loss on interest rate swaps	23			—			—
Gain from investment in unconsolidated entities	—			—			(160		)
Loss from investment in unconsolidated entities	1,475			1,358			106
Stock-based compensation	12			108			—
Change in operating assets and liabilities:
Other assets	(19,331		)	3,490			(8,537		)
Restricted cash	(8,811		)	616			(3,597		)
Accounts payable and other liabilities	19,978			13,414			13,077
Due to affiliates, net	3,918			(1,184		)	2,594
Net cash provided by operating activities	92,458			73,249			948
Investing Activities:
Acquisition of properties, net	(401,418		)	(661,618		)	(840,691		)
Cash assumed from the Signature Office REIT merger	8,557			—			—
Proceeds from disposition of properties	90,323			10,141			—
Real estate acquisition deposits	—			4,100			(3,350		)
Real estate funds held for exchange	(36,926		)	(10,105		)	—
Reserves for tenant improvements	2,537			—			—
Improvements to real estate	(7,173		)	(2,826		)	(256		)
Payments for construction in progress	(5,448		)	(1,766		)	(7		)
Real estate development, net of unpaid construction costs	(48,314		)	(21,691		)	—
Mortgage receivable from affiliate	(24,231		)	—			—
Land acquisition - real estate development	—			(7,529		)	—
Investment in unconsolidated joint venture	—			(68,424		)	(1,440		)
Distributions of capital from investment in unconsolidated entities	7,722			1,815			72
Net cash used in investing activities	(414,371		)	(757,903		)	(845,672		)
Financing Activities:
Proceeds from borrowings - KeyBank credit facility	—			151,000			198,000
Proceeds from borrowings - Mortgage debt	—			132,140			105,600
Proceeds from borrowings - KeyBank term loan	—			—			282,000
Proceeds from borrowings - Unsecured term loan (May 2014)	—			300,000			—
Proceeds from borrowings - Unsecured revolver (May 2014)	490,100			—			—
Proceeds from borrowings - Term Loan (July 2015)	640,000			—			—
Proceeds from borrowings - Revolver Loan (July 2015)	481,653			—			—
Principal payoff of secured indebtedness - Keybank credit facility	—			(195,500		)	(282,530		)
Principal payoff of secured indebtedness - Keybank term loan	—			(282,000		)	—
Principal payoff of secured indebtedness - Unsecured term loan (May 2014)	(300,000		)	—			—
Principal payoff of secured indebtedness - Unsecured revolver (May 2014)	(490,100		)	—			—
Principal payoff of secured indebtedness - Signature Office REIT Credit Facility	(173,000		)	—			—
Principal payoff of secured indebtedness - LTI mortgage loan	(31,407		)	—			—
Principal amortization payments on secured indebtedness	(2,283		)	(1,707		)	(1,396		)
Deferred financing costs	(4,872		)	(6,688		)	(8,750		)
Financing deposits	—			2,325			(2,325		)
Offering costs	(62		)	(76,638		)	(37,761		)
Issuance of common stock, net	—			774,722			364,740
Issuance of preferred equity subject to redemption	—			—			250,000
Issuance of noncontrolling interests, net	—			1,364			—
Repurchase of common stock	(13,819		)	(2,560		)	(614		)
Repurchase of preferred units	(254,525		)	—			—
Payment of offering costs - preferred units	—			—			(5,380		)
Distributions paid on preferred units subject to redemption	(10,859		)	(19,011		)	(1,354		)
Distributions to noncontrolling interests	(3,477		)	(3,410		)	(3,041		)
Distributions to common stockholders	(52,407		)	(30,875		)	(7,731		)
Net cash provided by financing activities	274,942			743,162			849,458
Net (decrease) increase in cash and cash equivalents	(46,971		)	58,508			4,734
Cash and cash equivalents at the beginning of the period	68,915			10,407			5,673
Cash and cash equivalents at the end of the period	$	21,944		$	68,915		$	10,407
Supplemental Disclosures of Cash Flow Information:
Cash paid for interest	$	27,518		$	19,718		$	11,255
Restricted cash - funded as a component of proceeds from borrowings	$	—		$	21,500		$	23,761
Supplemental Disclosures of Significant Non-cash Transactions:
Change in fair value of interest rate swap agreements	$	(6,560	)	$	(423	)	$	—
Construction in progress costs - real estate development	$	(38,208	)	$	(35,114	)	$	—
Unpaid construction in progress costs - real estate development	$	(10,106	)	$	13,423		$	—
Limited partnership units of the operating partnership issued in conjunction with the acquisition of real estate assets	$	7,282		$	—		$	8,335
Mortgage debt assumed in conjunction with the acquisition of real estate assets plus a premium of $749 and $1,799, respectively	$	73,701		$	23,843		$	—
Noncontrolling interest in land development	$	—		$	7,656		$	—
Increase in distributions payable to noncontrolling interests	$	42		$	9		$	56
Increase in distributions payable to common stockholders	$	2,637		$	1,924		$	859
(Decrease) increase in distributions payable to preferred unit holders	$	(1,615	)	$	—		$	1,615
Distributions to redeemable noncontrolling interests attributable to common stockholders as reflected on the consolidated statements of operations	$	359		$	355		$	318
Common stock issued pursuant to the distribution reinvestment plan	$	52,557		$	44,947		$	8,902
Common stock redemptions funded subsequent to year-end	$	6,336		$	1,240		$	244
Assets and liabilities assumed in conjunction with the Signature Office REIT merger:
Land	$	71,529		$	—		$	—
Building and improvements	$	436,350		$	—		$	—
Tenant origination and absorption cost	$	89,357		$	—		$	—
Above market leases	$	16,860		$	—		$	—
Other assets	$	2,148		$	—		$	—
Unsecured debt	$	173,000		$	—		$	—
Below market leases	$	6,996		$	—		$	—
Accounts payable and other liabilities	$	11,138		$	—		$	—
Equity consideration for the Signature Office REIT merger	$	433,667		$	—		$	—

See accompanying notes.

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Table of Contents          GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

1.     Organization

Griffin Capital Essential Asset REIT, Inc., a Maryland corporation (the "Company"), was formed on August 28, 2008 under the Maryland General Corporation Law. The Company was organized primarily with the purpose of acquiring single tenant properties that are essential to the tenant’s business and used a substantial amount of the net proceeds from the Public Offerings (as defined below) to invest in these properties. The Company satisfied requisite financial and non-financial requirements and elected to be taxed as a REIT for each taxable year ended since December 31, 2010 and for each year thereafter. The Company’s year end is December 31.

Griffin Capital Corporation, a California corporation (the "Sponsor"), has sponsored the Company’s Public Offerings. The Company’s Sponsor began operations in 1995, and was incorporated in 1996, to engage principally in acquiring and developing office and industrial properties. Kevin A. Shields, the Company's Chief Executive Officer and Chairman of the Company's board of directors, controls the Sponsor as the trustee of the trust entity that is the sole shareholder of the Sponsor.

Griffin Capital Essential Asset Advisor, LLC, a Delaware limited liability company (the "Advisor"), was formed on August 27, 2008. Griffin Capital Asset Management Company, LLC ("GAMCO," formerly known as Griffin Capital REIT Holdings, LLC) is the sole member of the Advisor, and Griffin Capital, LLC ("GC") is the sole member of GAMCO. The Company has entered into an advisory agreement for the Public Offerings (as amended and restated, the "Advisory Agreement"), which states that the Advisor is responsible for managing the Company’s affairs on a day-to-day basis and identifying and making acquisitions and investments on behalf of the Company. The officers of the Advisor are also officers of the Sponsor. The Advisory Agreement has a one-year term, and it may be renewed for an unlimited number of successive one-year periods by the Company's board of directors.

On August 28, 2008, the Advisor purchased 100 shares of common stock for $1,000 and became the Company’s initial stockholder. On February 20, 2009, the Company began to offer shares of common stock, pursuant to a private placement offering to accredited investors (collectively, the "Private Offering"), which included shares for sale pursuant to the distribution reinvestment plan ("DRP"). On November 6, 2009, the Company's registration statement was declared effective by the Securities and Exchange Commission ("SEC"), and the Company began to offer, in a public offering, a maximum of 82,500,000 shares of common stock, consisting of 75,000,000 shares at $10.00 per share (the "Primary Public Offering") and 7,500,000 shares pursuant to the DRP at $9.50 per share (together with the Primary Public Offering, the "Initial Public Offering") and terminated the Private Offering.

On April 25, 2013, the Company terminated its Initial Public Offering, having issued approximately 19,200,570 total shares of the Company's common stock for gross proceeds of approximately $191.5 million, including 585,533 shares, or $5.6 million, issued pursuant to the DRP. On April 26, 2013, the Company began to offer, in a follow-on offering, up to $1.0 billion in shares of common stock, consisting of approximately 97,200,000 shares at $10.28 per share in the primary offering (the "Primary Follow-On Offering" and together with the Primary Public Offering, the "Primary Public Offerings") and $100.0 million in shares of common stock, consisting of approximately 10,200,000 shares pursuant to the DRP at a price equal to 95% of the share price, which was approximately $9.77 per share (together with the Primary Follow-On Offering, the “Follow-On Offering” and, collectively with the Initial Public Offering, the "Public Offerings"). On April 22, 2014, the Company announced that it was no longer accepting subscriptions in the Follow-On Offering, as it expected to reach the maximum amount of offering proceeds. The Company issued 107,144,337 total shares of the Company's common stock for gross proceeds of approximately $1.1 billion in the Follow-On Offering, including 1,774,208 shares, or $17.3 million, issued pursuant to the DRP.

On May 7, 2014, the Company filed a Registration Statement on Form S-3 with the SEC for the registration of $75.0 million in shares for sale pursuant to the DRP (the "2014 DRP Offering"). On September 22, 2015, the Company filed a Registration Statement on Form S-3 with the SEC for the registration of $100.0 million in shares for sale pursuant to the DRP (the "2015 DRP Offering" and together with the 2014 DRP Offering, the "DRP Offerings") and terminated the 2014 DRP Offering. In connection with the DRP Offerings, the Company had issued 8,579,699 shares of the Company's common stock for gross proceeds of approximately $87.3 million through December 31, 2015. The 2015 DRP Offering may be terminated at any time upon 10 days’ prior written notice to stockholders.

On November 21, 2014, the Company entered into a merger agreement with Signature Office REIT, Inc. ("SOR"). In connection with the merger (the "SOR Merger"), (1) SOR merged into a wholly-owned subsidiary of the Company, and (2)

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

each share of common stock of SOR issued and outstanding was converted into 2.04 shares ("Merger Consideration") of the Company's common stock. On June 10, 2015, the Company issued approximately 41.8 million shares of common stock upon the consummation of the SOR Merger. The assets and liabilities of SOR are included in the Company's consolidated financial statements as of the closing date, June 10, 2015. See Note 3, Real Estate, for further discussion.

On October 22, 2015, the Company's board of directors (the "Board"), at the recommendation of the Nominating and Corporate Governance Committee of the Board (the "Nominating and Corporate Governance Committee") comprised solely of independent directors, approved an estimated value per share of the Company's common stock of $10.40 (unaudited) based on the estimated value of the Company's assets less the estimated value of the Company's liabilities, or net asset value, divided by the number of shares outstanding on a fully diluted basis (the "NAV"), calculated as of September 30, 2015. The Company is providing this estimated value per share to assist broker dealers in connection with their obligations under applicable Financial Industry Regulatory Authority rules with respect to customer account statements. This valuation was performed in accordance with the provisions of Practice Guideline 2013-01, Valuations of Publicly Registered Non-Listed REITs, issued by the Investment Program Association ("IPA") in April 2013, in addition to guidance from the SEC.

As of December 31, 2015, the Company had received aggregate gross offering proceeds of approximately $1.4 billion from the sale of shares in the Private Offering, the Public Offerings, and the DRP Offerings. There were 175,184,519 shares outstanding at December 31, 2015, including shares issued pursuant to the DRP, less shares redeemed pursuant to the share redemption program. As of December 31, 2015 and 2014, the Company had issued $110.2 million and $57.7 million, respectively, in shares pursuant to the DRP, which are classified on the consolidated balance sheets as common stock subject to redemption. The common stock subject to redemptions is net of cumulative redemptions which includes stock tendered at December 31, 2015 of approximately $6.3 million and $1.2 million, respectively, which is included in accounts payable and other liabilities on the consolidated balance sheets. See Note 8, Equity — Share Redemption Program. Since inception and through December 31, 2015, the Company had redeemed 1,753,700 shares of common stock for approximately $17.3 million at a weighted average price per share of $9.88 pursuant to the share redemption program.

Griffin Capital Securities, LLC (formerly known as Griffin Capital Securities, Inc., the "Dealer Manager") is an affiliate of the Sponsor, and is a wholly-owned subsidiary of GC. The Dealer Manager was responsible for marketing the Company’s shares offered during the Public Offerings. The dealer manager agreement was terminated in accordance with its terms upon the termination of the Follow-On Offering.

Griffin Capital Essential Asset Operating Partnership, L.P., a Delaware limited partnership (the "Operating Partnership"), was formed on August 29, 2008. The Operating Partnership owns, directly or indirectly, all of the properties that the Company has acquired. The Advisor purchased an initial 99% limited partnership interest in the Operating Partnership for $200,000, and the Company contributed the initial $1,000 capital contribution, received from the Advisor, to the Operating Partnership in exchange for a 1% general partner interest. As of December 31, 2015, the Company owned approximately 97% of the limited partnership units of the Operating Partnership, and, as a result of the contribution of five properties to the Company, the Sponsor and certain of its affiliates, including the Company’s Chief Executive Officer and Chairman, Kevin A. Shields, and certain officers of the Company, owned approximately 1% of the limited partnership units of the Operating Partnership. The remaining approximately 2% of the limited partnership units were owned by third parties. No limited partnership units of the Operating Partnership have been redeemed during the years ended December 31, 2015 and 2014. The Operating Partnership may conduct certain activities through the Company’s taxable REIT subsidiary, Griffin Capital Essential Asset TRS, Inc., a Delaware corporation (the "TRS") formed on September 2, 2008, which is a wholly-owned subsidiary of the Operating Partnership. The TRS had no activity as of December 31, 2015.

The Company’s property manager is Griffin Capital Essential Asset Property Management, LLC, a Delaware limited liability company (the “Property Manager”), which was formed on August 28, 2008 to manage the Company’s properties. The Property Manager derives substantially all of its income from the property management services it performs for the Company.

2.     Basis of Presentation and Summary of Significant Accounting Policies

The accompanying consolidated financial statements of the Company are prepared by management on the accrual basis of accounting and in accordance with principles generally accepted in the United States (“GAAP”) as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (the “Codification” or “ASC”), and in conjunction with rules and regulations of the SEC. The consolidated financial statements include accounts and related adjustments, which are, in the opinion of management, of a normal recurring nature and necessary for a fair presentation of the Company's financial position, results of operations and cash flows for the years ended December 31, 2015 and 2014. The consolidated financial

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Table of Contents          GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

statements include accounts of the Company, the Operating Partnership, including a consolidated VIE (see Note 4, Investments), and the TRS. All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of the consolidated financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could materially differ from those estimates.

Change in Consolidated Financial Statements Presentation

Certain amounts in the Company's prior period consolidated financial statements have been reclassified to conform to the current period presentation. Based on certain criteria discussed below, the Company classified an office property as held for sale as of December 31, 2015. As a result, certain assets and liabilities are presented as held for sale on the consolidated balance sheets for all periods presented. See Assets Held for Sale in Note 3, Real Estate.

Cash and Cash Equivalents

The Company considers all short-term, highly liquid investments that are readily convertible to cash with a maturity of three months or less at the time of purchase to be cash equivalents. Cash equivalents may include cash and short-term investments. Short-term investments are stated at cost, which approximates fair value. There were no restrictions on the use of the Company’s operating cash balance as of December 31, 2015 and 2014.

The Company maintains cash accounts with major financial institutions. The cash balances consist of business checking accounts and money market accounts. These accounts are insured by the Federal Deposit Insurance Corporation up to $250,000 at each institution. At times, the balances in these accounts may exceed the insured amounts. The Company considers balances in excess of the insured amounts to potentially be a concentration of credit risk. However, the Company has not experienced any losses with respect to cash balances in excess of government-provided insurance and does not anticipate any losses in the future.

Restricted Cash

In conjunction with the contribution of certain assets, as required by certain lease provisions or certain lenders in conjunction with an acquisition or debt financing, or credits received by the seller of certain assets, the Company assumed or funded reserves for specific property improvements and deferred maintenance, rent abatement, re-leasing costs, and taxes and insurance (see Note 3, Real Estate). As ofDecember 31, 2015and2014, the balance of these reserves, included in the consolidated balance sheets as restricted cash, was approximately $24.2 million and$40.8 million, respectively.The balance as of December 31, 2015 includes $2.0 million in rent collections from the eight properties, which serve as collateral under the Midland Mortgage loan and the DynCorp property, which was acquired in the current period, $13.3 million designated for deferred maintenance and re-leasing costs, $2.2 million of taxes and insurance reserves to be applied to future amounts incurred, and $6.6 million in rent received from the DreamWorks property, which is to be held in escrow pending the wind down of a tax-deferred real estate exchange, as permitted by Section 1031 of the Internal Revenue Code, with the sale of the Will Partners and LTI properties. Such exchange was completed on January 12, 2016, thus, releasing any restrictions on the DreamWorks rent receipts.

The proceeds of approximately $47.0 million from the sale of the Will Partners and LTI properties were deposited with a qualified intermediary, as both properties were treated as a tax-deferred exchange. See Note 3, Real Estate.

Real Estate

Purchase Price Allocation

The Company applies the provisions in ASC 805-10, Business Combinations, to account for the acquisition of real estate, or real estate related assets, in which a lease, or other contract, is in place representing an active revenue stream, as a business combination. In accordance with the provisions of ASC 805-10, the Company recognizes the assets acquired, the liabilities assumed and any noncontrolling interest in the acquired entity at their fair values as of the acquisition date, on an “as if vacant” basis. Further, the Company recognizes the fair value of assets acquired, liabilities assumed and any noncontrolling interest in acquisitions of less than a100%interest when the acquisition constitutes a change in control of the acquired entity. The accounting provisions have also established that acquisition-related costs and restructuring costs are considered separate and not

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Table of Contents          GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

a component of a business combination and, therefore, are expensed as incurred. Acquisition-related costs for the years ended December 31, 2015, 2014, and 2013 totaled $35.0 million, $28.6 million, and $29.5 million, respectively. For properties acquired in a sale-leaseback transaction or part of a development project, acquisition fees and acquisition expenses are included as part of the acquisition price.

Acquired in-place leases are valued as above-market or below-market as of the date of acquisition. The valuation is measured based on the present value (using an interest rate, which reflects the risks associated with the leases acquired) of the difference between (a) the contractual amounts to be paid pursuant to the in-place leases and (b) management’s estimate of fair market lease rates for the corresponding in-place leases over a period equal to the remaining non-cancelable term of the lease for above-market leases, taking into consideration below-market extension options for below-market leases. In addition, renewal options are considered and will be included in the valuation of in-place leases if (1) it is likely that the tenant will exercise the option, and (2) the renewal rent is considered to be sufficiently below a fair market rental rate at the time of renewal. The above-market and below-market lease values are capitalized as intangible lease assets or liabilities and amortized as an adjustment to rental income over the remaining terms of the respective leases.

The aggregate fair value of in-place leases includes direct costs associated with obtaining a new tenant, opportunity costs associated with lost rentals, which are avoided by acquiring an in-place lease, and tenant relationships. Direct costs associated with obtaining a new tenant include commissions, tenant improvements, and other direct costs and are estimated using methods similar to those used in independent appraisals and management’s consideration of current market costs to execute a similar lease. These direct costs are considered intangible lease assets and are included with real estate assets on the consolidated balance sheets. The intangible lease assets are amortized to expense over the remaining terms of the respective leases. The value of opportunity costs is calculated using the contractual amounts to be paid, including real estate taxes, insurance, and other operating expenses, pursuant to the in-place leases over a market lease-up period for a similar lease. Customer relationships are valued based on management’s evaluation of certain characteristics of each tenant’s lease and the Company’s overall relationship with that respective tenant. Characteristics management will consider in allocating these values include the nature and extent of the Company’s existing business relationships with tenants, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals (including those existing under the terms of the lease agreement), among other factors. These intangibles will be included in intangible lease assets on the consolidated balance sheets and are amortized to expense over the remaining term of the respective leases.

The determination of the fair values of the assets and liabilities acquired requires the use of significant assumptions about current market rental rates, rental growth rates, discount rates and other variables.

Depreciation and Amortization

The purchase price of real estate acquired and costs related to development, construction, and property improvements are capitalized. Repairs and maintenance costs include all costs that do not extend the useful life of the real estate asset and are expensed as incurred. The Company considers the period of future benefit of an asset to determine the appropriate useful life. The Company anticipates the estimated useful lives of its assets by class to be generally as follows:

Buildings	25-40 years
Building Improvements	5-20 years
Land Improvements	15-25 years
Tenant Improvements	Shorter of estimated useful life or remaining contractual lease term
Tenant origination and absorption cost	Remaining contractual lease term
In-place lease valuation	Remaining contractual lease term with consideration as to below-market extension options for below-market leases

Depreciation expense for buildings and improvements for the years ended December 31, 2015, 2014, and 2013 was $43.3 million, $27.7 million, and $10.1 million, respectively. Amortization expense for intangibles, including but not limited to, tenant origination and absorption costs for the years ended December 31, 2015, 2014, and 2013 was $69.4 million, $45.2 million, and $14.1 million, respectively. See Note 3, Real Estate, for amortization related to in-place lease valuations.

Assets Held for Sale

The Company accounts for properties held for sale in accordance with ASC Topic 360, Property, Plant, and Equipment, ("ASC Topic 360"), which addresses financial accounting and reporting for the impairment or disposal of long-lived assets and Accounting Standards Update ("ASU") No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant,

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity ("ASU No. 2014-08"). Under ASU No. 2014-08, a discontinued operation is (i) a component of an entity or group of components that has been disposed of by sale, that has been disposed of other than by sale, or that is classified as held for sale that represents a strategic shift that has or will have a major effect on an entity's operations and financial results or (ii) an acquired business or nonprofit activity that is classified as held for sale on the date of the acquisition.

In accordance with ASC 205, a component of an entity or a group of components of an entity, or a business or nonprofit activity (the entity to be sold), shall be classified as held for sale in the period in which all of the required criteria are met.

In accordance with ASC Topic 360, upon being classified as held for sale, a property is carried at the lower of (i) its carrying amount or (ii) fair value less costs to sell. In addition, a property being held for sale ceases to be depreciated. As of December 31, 2015, one property owned by the Company met the criteria to be classified as held for sale and was included in continuing operations in the consolidated statements of operations based on the Company's early adoption of ASU No. 2014-08, as it did not meet the prerequisite requirements to be classified as discontinued operations. See Note 3, Real Estate.

Impairment of Real Estate and Related Intangible Assets

The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of real estate and related intangible assets may not be recoverable. When indicators of potential impairment are present that indicate that the carrying amounts of real estate and related intangible assets may not be recoverable, management assesses whether the carrying value of the assets will be recovered through the future undiscounted operating cash flows expected from the use of the assets and the eventual disposition. If, based on this analysis, the Company does not believe that it will be able to recover the carrying value of the asset, the Company will record an impairment charge to the extent the carrying value exceeds the net present value of the estimated future cash flows of the asset.

Projections of expected future undiscounted cash flows require management to estimate future market rental income amounts subsequent to the expiration of current lease agreements, property operating expenses, discount rates, the number of months it takes to re-lease the property and the number of years the property is held for investment. As of December 31, 2015 and 2014, the Company did not record any impairment charges related to its real estate assets or intangible assets.

Intangible Assets and Liabilities Arising from In-Place Leases Where the Company is the Lessee

In-place ground leases where the Company is the lessee may have value associated with effective contractual rental rates that are above or below market rates. Such values are calculated based on the present value (using a discount rate that reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place lease and (ii) management's estimate of fair market lease rates for the corresponding in-place lease, measured over a period equal to the remaining terms of the lease. The capitalized above-market and below-market in-place lease values are recorded as intangible lease liabilities and assets, respectively, and are amortized as an adjustment to property operating expense over the remaining term of the respective lease.

The Operating Partnership, through a single purpose entity, assumed a ground lease with the acquisition of the Waste Management property on January 16, 2014. The ground lease has a remaining term of 80 years, expiring on December 31, 2095. See Note 3, Real Estate.

Investments

ASC 810-10, Consolidation, provides a framework for identifying variable interest entities (“VIEs”) and determining when a company should include the assets, liabilities, noncontrolling interests, and results of activities of the VIE in its consolidated financial statements. In general, a VIE is an entity or other legal structure used to conduct activities or hold assets that either (1) has an insufficient amount of equity to carry out its principal activities without additional subordinated financial support, (2) has a group of equity owners that are unable to make significant decisions about its activities, or (3) has a group of equity owners that do not have the obligation to absorb losses or the right to receive returns generated by its operations. Generally, a VIE should be consolidated if a party with an ownership, contractual, or other financial interest in the VIE (a variable interest holder) has the power to direct the VIE’s most significant activities and the obligation to absorb losses or right to receive benefits of the VIE that could be significant to the VIE. A variable interest holder that consolidates the VIE is called the primary beneficiary. Upon consolidation, the primary beneficiary generally must record all of the VIE’s assets, liabilities, and noncontrolling interest at fair value and subsequently account for the VIE as if it were consolidated based on majority voting interest. If the variable interest holder is not the primary beneficiary, the interest in the VIE is recorded under the equity method of accounting. See Note 4, Investments.    

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Table of Contents          GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

Revenue Recognition

Leases associated with the acquisition and contribution of certain real estate assets (see Note 3, Real Estate), have net minimum rent payment increases during the term of the lease and are recorded to rental revenue on a straight-line basis, commencing as of the contribution or acquisition date. If a lease provides for contingent rental income, the Company will defer the recognition of contingent rental income, such as percentage rents, until the specific target that triggers the contingent rental income is achieved.

During the years ended December 31, 2015, 2014, and 2013, the Company recognized deferred rent from tenants of $13.8 million, $11.6 million, and $3.5 million, respectively. As of December 31, 2015 and 2014, the cumulative deferred rent balance for assets not held for sale was $26.4 million and $15.6 million, respectively.

Tenant reimbursement revenue, which is comprised of additional amounts collected from tenants for the recovery of certain operating expenses, including repair and maintenance, property taxes and insurance, and capital expenditures, to the extent allowed pursuant to the lease (collectively "Recoverable Expenses"), is recognized as revenue when the additional rent is due. Recoverable Expenses to be reimbursed by a tenant are determined based on the Company's estimate of the property's operating expenses for the year, pro rated based on leased square footage of the property, and are collected in equal installments as additional rent from the tenant, pursuant to the terms of the lease. At the end of the calendar year, the Company reconciles the amount of additional rent paid by the tenant during the year to the actual amount of Recoverable Expenses incurred by the Company for the same period. The difference, if any, is either charged or credited to the tenant pursuant to the provisions of the lease. In certain instances, the lease may restrict the amount the Company can recover from the tenant such as a cap on certain or all property operating expenses. As of December 31, 2015, the Company estimated that approximately $2.3 million, net, was over collected from tenants throughout the year, and as a result, the Company recorded a liability to reflect the net over collections which will be refunded to the tenants either by a credit to contractual rent payments or as a disbursement from operating cash flow.

Organizational and Offering Costs

Organizational and offering costs of the Primary Public Offerings are paid either by the Company or the Sponsor, on behalf of the Advisor, for the Company, which were reimbursed from the proceeds of the Public Offerings at the estimated rate. Organizational and offering costs consist of all expenses (other than sales commissions and dealer manager fees) paid by the Company in connection with the Public Offerings, including legal, accounting, printing, mailing and filing fees, charges from the escrow holder and other accountable offering expenses, including, but not limited to, (i) amounts to reimburse the Advisor for all marketing-related costs and expenses, such as salaries and direct expenses of employees of the Advisor and its affiliates in connection with registering and marketing the Company’s shares; (ii) technology costs associated with the offering of the Company’s shares; (iii) costs of conducting training and education meetings; (iv) costs of attending seminars conducted by participating broker-dealers; and (v) payment or reimbursement of bona fide due diligence expenses.

Pursuant to the Advisory Agreement, the Company was obligated to reimburse the Advisor for organizational and offering expenses incurred in connection with the Primary Public Offerings in an amount not to exceed 3.5% of gross offering proceeds of the terminated or completed Primary Public Offerings for issuer costs (excluding sales commissions and dealer manager fees). In addition, pursuant to the Advisory Agreement, organization and offering expenses (including sales commissions and dealer manager fees and non-accountable due diligence expense allowance but excluding acquisition fees and expenses) were subject to a limitation of 15% of gross offering proceeds of the terminated or completed Public Offerings. If the organization and offering expenses exceeded such limits discussed above, within 60 days after the end of the month in which the Public Offerings terminated or were completed, the Advisor would have been obligated to reimburse the Company for any excess amounts. As long as the Company is subject to the Statement of Policy Regarding Real Estate Investment Trusts published by the North American Securities Administrators Association (“NASAA REIT Guidelines”), such limitations discussed above will also apply to any future public offerings. As of December 31, 2015, the Company was not obligated to reimburse the Advisor for any organizational and offering expenses. As of December 31, 2015, the Company incurred approximately $130.6 million of offering costs and approximately $0.8 million in organizational costs.

Deferred Financing Costs

Deferred financing costs represent commitment fees, loan fees, and other fees associated with obtaining financing. These costs are amortized to, and included as a component of, interest expense over the terms of the respective financing agreements. Amortization expense for the years ended December 31, 2015, 2014, and 2013 was $3.8 million, $3.9 million, and $1.9 million, respectively. Amortization expense for the year ended December 31, 2015 includes approximately $1.4 million of write-offs

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Table of Contents          GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

related to the Unsecured credit facility (May 2014), which was terminated upon the execution of the Unsecured Credit Facility (July 2015) on July 20, 2015. Similarly, the amortization expense for the year ended December 31, 2014 includes approximately $1.7 million of write-offs related to the refinancing through the AIG loan on January 24, 2014 and the Company's previously existing KeyBank credit facility and KeyBank term loan, which were both terminated in conjunction with the execution of the Unsecured credit facility (May 2014) on May 8, 2014. As of December 31, 2015 and 2014, the Company’s deferred financing costs, net of accumulated amortization, were $12.9 million and $11.8 million, respectively.

Other Assets

Other assets consist primarily of tenant and non-tenant receivables, prepaid expenses, and deferred leasing commissions and other leasing costs ("Deferred Leasing Costs"), net of amortization. Non-tenant receivables primarily consist of a $4.9 million and a $2.9 million termination fee, as a result of the lease terminations with World Kitchen, LLC, the former tenant at the Will Partners property, on January 24, 2014, and with Wells Fargo Bank, N.A., the former tenant at the Wells Fargo property, on December 31, 2015, respectively. Prepaid expenses, which are capitalized as other assets, will be expensed over the corresponding period. Leasing commissions for new, renewal, or expansion leases are amortized using the straight-line method over the term of the related lease. Amortization of Deferred Leasing Costs is included in depreciation and amortization in the Company's accompanying consolidated statements of operations. Deferred Leasing Costs, net of the Deferred Leasing Costs related to the real estate held for sale, totaled $13.2 million and $2.2 million as of December 31, 2015 and 2014, respectively.

Noncontrolling Interests

Due to the Company’s control through the general partner interest in the Operating Partnership and the limited rights of the limited partners, the Operating Partnership, including its wholly-owned subsidiaries, is consolidated with the Company and the limited partners’ interests are reflected as noncontrolling interests on the accompanying consolidated balance sheets.

The Company reports noncontrolling interests in subsidiaries within equity in the consolidated financial statements, but separate from total stockholders’ equity. Also, any acquisitions or dispositions of noncontrolling interests that do not result in a change of control are accounted for as equity transactions. Further, the Company recognizes a gain or loss in net income (loss) when a subsidiary is deconsolidated upon a change in control. Net income (loss) allocated to noncontrolling interests is shown as an adjustment to net income (loss) attributable to common stockholders. Any future purchase or sale of an interest in an entity that results in a change of control may have a material impact on the financial statements, as the interest in the entity will be recognized at fair value with gains and losses included in net income (loss).

If noncontrolling interests are determined to be redeemable, they are classified as temporary equity and reported at their redemption value as of the balance sheet date. Since redeemable noncontrolling interests are carried at the redemption amount, net income (loss) and distributions are not allocated to redeemable noncontrolling interests. Distributions to redeemable noncontrolling interest holders are allocated between common stockholders and noncontrolling interests based on their respective weighted-average ownership percentage of the Operating Partnership. See Note 8, Equity.

Share-Based Compensation

The Company has adopted an Employee and Director Long-Term Incentive Plan (the “Plan”) pursuant to which the Company may issue stock-based awards to its directors and full-time employees (should the Company ever have employees), executive officers and full-time employees of the Advisor and its affiliate entities that provide services to the Company, and certain consultants who provide significant services to the Company. The term of the Plan is 10 years and the total number of shares of common stock reserved for issuance under the Plan is 10% of the outstanding shares of stock at any time, not to exceed 10,000,000 shares in the aggregate. Awards granted under the Plan may consist of stock options, restricted stock, stock appreciation rights and other equity-based awards. The stock-based payment will be measured at fair value and recognized as compensation expense over the vesting period.

On March 3, 2014, the compensation committee of the board of directors authorized the issuance of 5,000 shares of restricted stock to each of the Company's independent directors. These restricted shares were immediately vested upon issuance. In addition, the compensation committee authorized the future issuance of 1,000 shares of restricted stock to each of the Company's independent directors for each 12-consecutive-month period during which each independent director continuously remains a director for the Company. The future shares granted will vest over a three year period, or will immediately vest upon a change in control of the Company. Upon re-election of each independent director at the June 12, 2014 annual stockholders' meeting, the Company measured and began recognizing director compensation expense for the 1,000 shares of restricted stock granted, subject to the vesting period. One-third of the shares of restricted stock, or 333 shares, for

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Table of Contents          GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

each of the Company's independent directors, vested during the year ended December 31, 2015. The fair value of both issuances was estimated at $10.28 per share, the then most recent price paid to acquire a share of the Company's common stock. All issuances of restricted stock are entitled to dividends upon vesting of the shares.

Upon re-election of each independent director at the June 16, 2015 annual stockholders' meeting, the Company granted 1,000 shares of restricted common stock to each of the independent directors. The fair value of such issuance was estimated at $10.40 per share, the then most recent price paid to acquire a share of the Company's common stock related to the 2014 DRP Offering. Immediately upon granting the restricted common shares, the Company measured and began recognizing director compensation expense, subject to the same vesting period discussed above.

Derivative Instruments and Hedging Activities

FASB ASC Topic 815: Derivatives and Hedging ("ASC 815"), provides the disclosure requirements for derivatives and hedging activities with the intent to provide users of financial statements with an enhanced understanding of: (a) how and why an entity uses derivative instruments, (b) how the entity accounts for derivative instruments and related hedged items, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. Further, qualitative disclosures are required that explain the Company’s objectives and strategies for using derivatives, as well as quantitative disclosures about the fair value of gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative instruments.

As required by ASC 815, the Company recorded all derivatives on the consolidated balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, and whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain risks, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. See Note 6, Interest Rate Contracts.

Fair Value Measurements

The fair value of financial and nonfinancial assets and liabilities is based on a fair value hierarchy established by the FASB that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described as follows:

• Level 1. Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets;

• Level 2. Inputs to the valuation methodology include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

• Level 3. Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

See Note 7, Fair Value Measurements.

Income Taxes

The Company elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”). To qualify as a REIT, the Company must meet certain organizational and operational requirements. The Company intends to adhere to these requirements and maintain its REIT status for the current year and subsequent years. As a REIT, the Company generally will not be subject to federal income taxes on taxable income that is distributed to stockholders. However, the Company may be subject to certain state and local taxes on its income and property, and federal income and excise taxes on its undistributed taxable income, if any. If the Company fails to qualify as a REIT in any taxable year, the Company will then be subject to federal income taxes on the taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year during which

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Table of Contents          GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

qualification is lost unless the IRS grants the Company relief under certain statutory provisions. Such an event could materially adversely affect net income and net cash available for distribution to stockholders. As of December 31, 2015, the Company satisfied the REIT requirements and distributed all of its taxable income.

Pursuant to the Code, the Company has elected to treat its corporate subsidiary as a taxable REIT subsidiary (“TRS”). In general, the TRS may perform non-customary services for the Company’s tenants and may engage in any real estate or non real estate-related business. The TRS will be subject to corporate federal and state income tax. As of December 31, 2015, the TRS had not commenced operations.

Per Share Data

The Company reports earnings per share for the period as (1) basic earnings per share computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding during the period, and (2) diluted earnings per share computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding, including common stock equivalents. As of December 31, 2015 and 2014, there were no common stock equivalents that would have a dilutive effect on earnings (loss) per share for common stockholders.

Distributions declared and paid per common share assume each share was issued and outstanding each day during the three months ended December 31, 2015. Distributions declared per common share were based on daily declaration and record dates selected by the Company’s board of directors of $0.001901096 per day per share on the outstanding shares of common stock.

Segment Information

ASC Topic 280, Segment Reporting, establishes standards for reporting financial and descriptive information about a public entity’s reportable segments. The Company internally evaluates all of the properties and interests therein as one reportable segment.

Unaudited Data

Any references to the number of buildings, square footage, number of leases, occupancy, and any amounts derived from these values in the notes to the consolidated financial statements are unaudited and outside the scope of the Company's independent registered public accounting firm's audit of its consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board.

Recently Issued Accounting Pronouncements

In February 2016, the FASB issued ASU 2016-02, Leases. ASU 2016-02 amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. ASU 2016-02 will be effective beginning in the first quarter of 2019. Early adoption of ASU 2016-02 as of its issuance is permitted. The new leases standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. The Company is currently evaluating the impact of adopting the new leases standard on the consolidated financial statements.

In September 2015, the FASB issued ASU No. 2015-16, Simplifying the Accounting for Measurement Period Adjustments (“ASU No. 2015-16”). In a business combination, ASU No. 2015-16 requires an acquirer to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The acquirer is required to disclose, by financial statement line item, the nature and amount for the adjustments and the current period income statement impact related to prior periods. The amendments in this ASU are effective for fiscal years beginning December 15, 2016 and interim periods beginning after December 15, 2017. Early adoption is permitted. The Company elected to adopt ASU No. 2015-16 early, beginning with the quarter ended September 30, 2015. There was no significant impact to the Company's consolidated financial statements or notes to theconsolidated financial statements as a result of early adoption.

In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30) (“ASU 2015-03”) to amend the accounting guidance for the presentation of debt issuance costs. The standard requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. ASU 2015-03 is effective for public business entities for fiscal years beginning

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Table of Contents          GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

after December 15, 2015 and retrospective application is required. Early adoption of the guidance is permitted. The Company does not expect the adoption of ASU No. 2015-03 to have a significant impact on its financial statements.

In February 2015, the FASB issued ASU No. 2015-02, Consolidation: Amendments to the Consolidation Analysis ("ASU No. 2015-02"), which amended the existing accounting standards for consolidation under both the variable interest model and the voting model. Under ASU No. 2015-02, companies will need to re-evaluate whether an entity meets the criteria to be considered a VIE, whether companies still meet the definition of primary beneficiaries, and whether an entity needs to be consolidated under the voting model. ASU No. 2015-02 may be applied using a modified retrospective approach or retrospectively, and is effective for reporting periods beginning after December 15, 2015. Early adoption is permitted. The Company does not expect the adoption of ASU No. 2015-02 to have a significant impact on its financial statements.

In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements (Subtopic 205-40), Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU No. 2014-15”). The amendments in ASU No. 2014-15 require management to evaluate, for each annual and interim reporting period, whether there are conditions or events, considered in the aggregate, that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or are available to be issued when applicable) and, if so, provide related disclosures. ASU No. 2014-15 is effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Early adoption is permitted for annual or interim reporting periods for which the financial statements have not previously been issued. The Company does not expect the adoption of ASU No. 2014-15 to have a significant impact on its financial statements.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU No. 2014-09”). ASU No. 2014-09 replaces substantially all industry-specific revenue recognition requirements and converges areas under this topic with International Financial Reporting Standards. ASU No. 2014-09 implements a five-step process for customer contract revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards. ASU No. 2014-09 also requires enhanced disclosures regarding the nature, amount, timing, and uncertainty of revenues and cash flows from contracts with customers. Other major provisions in ASU No. 2014-09 include capitalizing and amortizing certain contract costs, ensuring the time value of money is considered in the applicable transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. ASU No. 2014-09 was originally effective for reporting periods beginning after December 31, 2016 (for public entities). On April 1, 2015, the FASB voted to defer the effective date of ASU No. 2014-09 by one year, to annual reporting periods beginning after December 15, 2017. On July 9, 2015, the FASB affirmed its proposal to defer the effective date to annual reporting periods beginning after December 15, 2017, although entities may elect to adopt the standard as of the original effective date. The Company is currently evaluating the potential impact of the pending adoption of this new guidance on its consolidated financial statements.

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3.     Real Estate

As of December 31, 2015, the Company’s real estate portfolio consisted of 74 properties in 20 states consisting substantially of office, warehouse, and manufacturing facilities with a combined acquisition value of approximately $3.0 billion, including the allocation of the purchase price to above and below-market lease valuation.

2015 Acquisitions and SOR Merger

During the year ended December 31, 2015, the Company acquired six properties from unaffiliated parties and one property from an affiliated party. The aggregate purchase price of the acquisitions was approximately $483.6 million.

As previously discussed in Note 1, the SOR Merger closed on June 10, 2015, and as part of the SOR Merger, the Company assumed 15 buildings located on 13 properties in 8 states, comprising a total of approximately 2.6 million square feet. The properties assumed through the SOR Merger have been allocated a combined value of $607.1 million.

A summary of the fair value of the assets and liabilities acquired and assumed through the SOR Merger in exchange for approximately 41.8 million shares of the Company's stock is shown in the table below:

Cash assumed	$	8,557
Land	71,529
Building and improvements	436,350
Tenant origination and absorption cost	89,357
Above market leases	16,860
Other assets	2,148
Total assets	$	624,801
Unsecured debt (1)	$	173,000
Below market leases	6,996
Accounts payable and other liabilities	11,138
Total liabilities	191,134
Equity consideration for SOR Merger	433,667
Total liabilities and equity	$	624,801

(1) The unsecured debt was terminated simultaneously with the closing of the SOR Merger, and repaid with borrowings from the Company's Unsecured credit facility (May 2014).

Highway 94

On November 6, 2015, the Company, through a wholly-owned subsidiary of the Operating Partnership, acquired the interests of Griffin Capital (Highway 94) Investors, DST ("Highway 94") from 45 unaffiliated third party investors. The Highway 94 property is a 660,000 square foot manufacturing facility located in Jefferson City, Missouri, and was managed by an affiliate of the Advisor. The Highway 94 property is leased in its entirety to ABB, Inc., which lease terminates on August 31, 2024. ABB, Inc. has the option to purchase the Highway 94 property through the termination date of the lease. The unaffiliated third party investors contributed all of their ownership interests in Highway 94 in exchange for either limited partnership units in the Operating Partnership or cash. The purchase price of the Highway 94 property was $31.9 million. The Company, through the Operating Partnership, issued approximately $7.3 million in limited partnership units to those investors who elected to exchange their ownership interest. The issuance of the limited partnership units is included as a component of noncontrolling interest in the Company's permanent equity. The

F-18

remaining balance of approximately $24.6 million consists of a mortgage loan assumption of approximately $19.0 million and a cash payment made to the unaffiliated third party investors of $5.6 million.

The aggregate value of the 21 properties related to the 2015 acquisitions, SOR Merger, and completion of the Restoration Hardware project, which was transferred out of construction in progress in August 2015, was approximately $1.2 billion as shown below:

Property	Location	Tenant/Major Lessee	Acquisition/ Merger Date	Purchase Price			Approx. Square Feet	Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)			Unsecured Credit Facility		Other Debt Financings			Year of Lease Expiration (for Major Lessee)
GE Aviation	West Chester, OH	General Electric Company	2/19/2015	$	66,000		409,800	$	1,980		$	50,000	$	—		2020
Westgate III	Houston, TX	Wood Group Mustang, Inc.	4/1/2015	77,000			225,500	2,310			76,100		—			2026
Lisle	Lisle, IL	McCain Foods USA, Inc.	6/10/2015	19,500		(2)	94,400	(2)			(3)		—			2021
Bloomingdale	Bloomingdale, IL	BFS Retail & Commercial Operations, LLC	6/10/2015	7,450		(2)	71,100	(2)			(3)		—			2018
Columbia	Columbia, MD	Leidos Holdings, Inc.	6/10/2015	58,130		(2)	200,600	(2)			(3)		—			2019
Denver	Denver, CO	Jackson National Life Insurance Company	6/10/2015	35,000		(2)	182,900	(2)			(3)		—			2027
Columbus	Dublin, OH	Qwest Communications Company, LLC	6/10/2015	27,600		(2)	164,600	(2)			(3)		—			2022
Miramar	Miramar, FL	Humana Medical Plan Inc.	6/10/2015	24,600		(2)	96,400	(2)			(3)		—			2023
Irving Carpenter	Irving, TX	NEC Corporation of America	6/10/2015	23,500		(2)	119,600	(2)			(3)		—			2026
Frisco	Frisco, TX	T-Mobile West Corporation	6/10/2015	59,250		(2)	284,200	(2)			(3)		—			2017
Houston Westway II	Houston, TX	VetcoGray, Inc. (GE Oil & Gas, Inc.)	6/10/2015	82,500		(2)	242,400	(2)			(3)		—			2022
Houston Westway I	Houston, TX	Cameron Solutions	6/10/2015	37,700		(2)	144,000	(2)			(3)		—			2018
Atlanta Perimeter	Atlanta, GA	State Farm Mutual Automobile Insurance Company	6/10/2015	101,670		(2)	584,800	(2)			(3)		—			2023
Herndon	Herndon, VA	Time Warner Cable Southeast, LLC	6/10/2015	87,300		(2)	268,200	(2)			(3)		—			2019
Deerfield	Deerfield, IL	CF Industries Holdings, Inc.	6/10/2015	42,900		(2)	171,900	(2)			(3)		—			2027
DreamWorks	Glendale, CA	DreamWorks Animation SKG, Inc.	7/21/2015	215,000			459,800	(4)			205,000		—			2035
Restoration Hardware	Patterson, CA	Restoration Hardware, Inc.	8/15/2015	99,850		(5)	1,501,400	2,965		(5)	—		—			2030
Highway 94	Jefferson City, MO	ABB, Inc.	11/6/2015	31,940			660,000	958			—		19,033		(6)	2024
DynCorp	Fort Worth, TX	DynCorp International, LLC	12/11/2015	16,650			119,000	499			—		11,162		(6)	2018
Mercedes-Benz	Fort Worth, TX	Mercedes-Benz Financial Services USA	12/11/2015	29,000			164,300	870			—		18,945		(6)	2018

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Property	Location	Tenant/Major Lessee	Acquisition/ Merger Date	Purchase Price		Approx. Square Feet	Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)		Unsecured Credit Facility		Other Debt Financings			Year of Lease Expiration (for Major Lessee)
Samsonite	Jacksonville, FL	Samsonite, LLC	12/11/2015	48,000		817,700	1,440		—		24,561		(6)	2024
				$	1,190,540	6,982,600	$	11,022	$	331,100	$	73,701

(1) The Advisor is entitled to receive acquisition fees equal to 2.5% and acquisition expense reimbursement of up to 0.5% of the contract purchase price for each property acquired. The total is included in acquisition fees and expenses to affiliates on the consolidated statements of operations.

(2) Represents a property assumed through the SOR Merger. Purchase Price represents purchase price allocations based on real estate value of $607.1 million. In conjunction with the SOR Merger on June 10, 2015, the Advisor received acquisition fees equal to 2.5%, or approximately $15.2 million, of the real estate value of $607.1 million. In addition, the Advisor also received actual expense reimbursements of $2.8 million, which was paid on July 14, 2015.

(3) In connection with the SOR Merger on June 10, 2015, the Company, through the Operating Partnership, borrowed $173.0 million from the Unsecured revolver (May 2014) to repay the outstanding SOR debt, as discussed in Note 5, Debt.

(4) The Advisor received acquisition fees equal to 2.5%, or approximately $5.4 million, of the acquisition value of $215.0 million. In addition, the Advisor also received actual expense reimbursements of $0.8 million.

(5) Represents a development project with WRRH Patterson, LLC, which was placed into service on August 15, 2015. The total acquisition fees and expense reimbursements payable to the Advisor were included in the basis of the property, as discussed in Note 4, Investments.

(6) Represents the mortgage loans assumed in conjunction with the acquisitions of the Highway 94, DynCorp, Mercedes-Benz, and Samsonite properties. See Note 5, Debt.

The following summarizes the purchase price allocation of the 2015 acquisitions and SOR Merger:

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Property	Land		Building and improvements		Tenant origination and absorption cost		In-place lease valuation - above/(below) market			Debt discount/(premium)			Total
GE Aviation	$	4,400	$	52,211	$	9,470	$	(81	)	$	—		$	66,000
Westgate III	3,209		60,852		15,085		(2,146		)	—			77,000
DreamWorks	26,387		148,163		42,642		(2,192		)	—			215,000
Highway 94 (1)	5,540		21,300		6,930		(4,080		)	2,250			31,940
DynCorp (1)	1,952		13,546		1,994		(842		)	—			16,650
Mercedes-Benz (1)	2,330		23,424		2,952		294			—			29,000
Samsonite (1)	5,040		37,152		5,338		1,971			(1,501		)	48,000
Total acquisitions	$	48,858	$	356,648	$	84,411	$	(7,076	)	$	749		$	483,590
Lisle	2,788		11,209		4,991		512			—			19,500
Bloomingdale	1,178		4,689		493		1,090			—			7,450
Columbia	6,989		42,690		4,185		4,266			—			58,130
Denver	9,948		22,714		1,174		1,164			—			35,000
Columbus	2,943		14,896		7,755		2,006			—			27,600
Miramar	4,488		18,211		1,768		133			—			24,600
Irving Carpenter	1,842		19,479		2,573		(394		)	—			23,500
Frisco	8,239		47,296		4,099		(384		)	—			59,250
Houston Westway II	3,961		67,484		11,184		(129		)	—			82,500
Houston Westway I	6,540		27,765		2,938		457			—			37,700
Atlanta Perimeter	8,607		63,247		33,472		(3,656		)	—			101,670
Herndon	9,667		66,303		7,794		3,536			—			87,300
Deerfield	4,339		30,367		6,931		1,263			—			42,900
Total SOR Merger	$	71,529	$	436,350	$	89,357	$	9,864		$	—		$	607,100
Total acquisitions and SOR Merger	$	120,387	$	792,998	$	173,768	$	2,788		$	749		$	1,090,690

(1) As of December 31, 2015, the purchase price allocation for the Highway 94, DynCorp, Mercedes-Benz, and Samsonite properties had not been finalized.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

Pro Forma Financial Information (unaudited)

The following condensed pro forma operating information is presented as if the Company’s properties acquired in 2015 had been included in operations as of January 1, 2014. The pro forma operating information includes certain nonrecurring adjustments, such as acquisition fees and expenses incurred as a result of the assets acquired in the acquisitions:

	Year Ended December 31,
	2015			2014
Revenue	$	345,092		$	318,720
Net income	$	63,170		$	49,499
Net income attributable to noncontrolling interests	$	1,259		$	979
Distributions to redeemable noncontrolling interests attributable to common stockholders	$	(359	)	$	(355	)
Net income attributable to common stockholders (1)	$	42,402		$	29,154
Net income attributable to common stockholders per share, basic and diluted	$	0.24		$	0.19

(1) Amount is net of net income (loss) attributable to noncontrolling interests and distributions to redeemable noncontrolling interests attributable to common stockholders.

The future minimum contractual rent payments pursuant to the lease terms, with lease expirations ranging from 2016 to 2035, are shown in the table below:

2016	$	254,246
2017	253,976
2018	246,264
2019	215,126
2020	189,114
Thereafter	1,001,398
Total	$	2,160,124

Tenant and Portfolio Risk

The Company monitors the credit of all tenants to stay abreast of any material changes in credit quality. The Company monitors tenant credit by (1) reviewing the credit ratings of tenants (or their parent companies or lease guarantors) that are rated by nationally recognized rating agencies; (2) reviewing financial statements and related metrics and information that are publicly available or that are required to be provided pursuant to the lease; (3) monitoring news reports and press releases regarding the tenants (or their parent companies or lease guarantors), and their underlying business and industry; and (4) monitoring the timeliness of rent collections.

Tenant security deposits as of December 31, 2015 and 2014, which were included in the accounts payable and other liabilities balance on the consolidated balance sheets, totaled $0.8 million and $0.2 million, net of tenant security deposits related to the real estate held for sale, respectively, as required pursuant to the leases for certain tenants. The Company bears the full risk of tenant rent collections for those leases in which a security deposit is not required. Certain leases do, however, require the tenant to pay a penalty in the event of early termination, which fee would be utilized for re-tenanting and restoration. Tenant receivables, which the Company deemed to be fully collectible, totaled $2.2 million and $0.3 million, net of tenant receivables related to the real estate held for sale, as of December 31, 2015 and 2014, respectively. Tenant receivables are included in other assets, net, on the consolidated balance sheets.

In conjunction with certain assets contributed to the Company in exchange for limited partnership units of the Operating Partnership, the Company effected tax protection agreements in favor of the contributor whereby the Company would be liable to reimburse the contributor, through a special distribution, for any tax liability incurred by the contributor as a result of the disposal of the contributed asset, for a time period specified in the tax protection agreement. As of December 31, 2015, the Company has not been obligated to any contributor for a tax liability incurred as a result of an asset disposition.

Sale of College Park Property

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

On February 20, 2015, the Company sold the College Park property located in Indianapolis, Indiana for total proceeds of $14.3 million, less closing costs and other closing credits of approximately $2.5 million. The carrying value of the College Park property on the closing date was approximately $8.2 million, which was comprised of $6.4 million of real estate assets, net, $0.8 million of deferred rent, and $1.0 million of other leasing costs, such as leasing commissions. Upon the sale of the College Park property, the Company recognized a gain of $3.6 million. In conjunction with the sale, the Advisor was paid a disposition fee of approximately $0.1 million, in accordance with the Advisory Agreement. The Company elected to complete the sale as part of a tax-deferred exchange of real estate as permitted by Section 1031 of the Internal Revenue Code, and thus, the proceeds of the sale of the College Park property were deposited with a qualified intermediary. The funds were subsequently released upon the Company's acquisition of the GE Aviation property.

Sale of Will Partners Property

On August 7, 2015, the Company sold the Will Partners property located in Monee, Illinois, for total proceeds of $22.0 million, less closing costs and other closing credits of approximately $0.8 million. The carrying value of the Will Partners property on the closing date was approximately $17.1 million, which was primarily comprised of real estate assets, net, and other liabilities. Upon the sale of the property, the Company recognized a gain of approximately $4.1 million. In conjunction with the sale, the Advisor was paid a disposition fee of approximately $0.2 million, in accordance with the Advisory Agreement. The Company elected to complete the sale as part of a tax-deferred exchange of real estate as permitted by Section 1031 of the Internal Revenue Code, and thus, the proceeds of the sale of the property were deposited with a qualified intermediary.

Sale of LTI Property

On December 31, 2015, Life Technologies Corporation, the tenant previously occupying the LTI property, exercised its option to purchase the building located in Carlsbad, California, for total proceeds of $57.4 million, less closing costs of approximately $0.3 million. The carrying value of the LTI property on the closing date was approximately $51.0 million, which was comprised of $45.2 million of real estate assets, net, $1.6 million of deferred rent, and $4.2 million of other intangibles, such as tenant absorption costs and below market rent, net. Upon the sale of the property, the Company recognized a gain of approximately $6.1 million. In conjunction with the sale, the Advisor was paid a disposition fee of approximately $0.3 million, in accordance with the Advisory Agreement. The Company elected to complete the sale as part of a tax-deferred exchange of real estate as permitted by Section 1031 of the Internal Revenue Code, and thus, the proceeds of the sale of the property were deposited with a qualified intermediary.

Asset Held for Sale

As of December 31, 2015, one property, the One Century Place property located in Nashville, Tennessee, met the criteria to be classified as held for sale. Therefore, the Company classified the property as held for sale, net, on the consolidated balance sheets at the lower of its (i) carrying amount or (ii) fair value less costs to sell as of December 31, 2015. The summary includes the College Park, Will Partners, LTI and One Century Place properties as of December 31, 2014. Since the College Park and Will Partners properties were sold during 2015, the properties were not included in the current year balance sheet. The College Park, Will Partners, LTI and One Century Place properties are included in continuing operations in the consolidated statements of operations based on the Company's early adoption of ASU No. 2014-08, as it did not meet the prerequisite requirements to be classified as discontinued operations.

The following summary presents the major components of assets and liabilities related to the real estate held for sale as of December 31, 2015 and 2014:

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

	Balance December 31, 2015			Balance December 31, 2014
Restricted cash	$	561		$	1,450
Real Estate:
Land	8,025			10,256
Building	42,858			66,629
Tenant origination and absorption cost	20,003			21,400
Construction in progress	22			271
Total Real Estate	70,908			98,556
Less: accumulated depreciation and amortization	(7,034		)	(7,893		)
Total real estate, net	63,874			90,663
In-place lease valuation - above market	813			813
Deferred rent	2,716			2,135
Other assets	829			1,801
Total assets	$	68,793		$	96,862
Accounts payable and other liabilities	$	2,203		$	2,763
Due to affiliates	81			104
Restricted reserve	561			1,039
Total liabilities	$	2,845		$	3,906

The following is a summary of the income (loss) included in the Company's income from continuing operations for the years ended December 31, 2015, 2014, and 2013 from assets classified as held for sale subsequent to the Company's adoption of ASU No. 2014-08, which includes the College Park, Will Partners, and One Century Place properties:

	Year Ended December 31,
	2015			2014			2013
Total revenues	$	12,128		$	13,231		$	5,254
Operating expenses	(6,368		)	(8,306		)	(4,189		)
Total revenues less operating expenses from assets classified as "held for sale," not qualifying as discontinued operations	5,760			4,925			1,065
Depreciation and amortization expense	(2,554		)	(8,156		)	(2,041		)
Interest expense	—			(907		)	(170		)
Income (loss) from assets classified as "held for sale," not qualifying as discontinued operations	$	3,206		$	(4,138	)	$	(1,146	)

Intangibles

The Company allocated a portion of the acquired and contributed real estate asset value to in-place lease valuation and tenant origination and absorption cost, as discussed above and as shown below, net of the write-off of intangibles for the years ended December 31, 2015 and 2014. In-place leases were measured against comparable leasing information and the present value of the difference between the contractual, in-place rent, and the fair market rent was calculated using, as the discount rate, the capitalization rate utilized to compute the value of the real estate at acquisition or contribution.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

	Balance December 31, 2015			Balance December 31, 2014
In-place lease valuation (above market)	$	45,413		$	26,289
In-place lease valuation (above market) - accumulated amortization	(10,844		)	(4,896		)
In-place lease valuation (above market), net	34,569			21,393
Ground leasehold interest (below market)	2,254			2,254
Ground leasehold interest (below market) - accumulated amortization	(54		)	(26		)
Ground leasehold interest (below market), net	2,200			2,228
Intangible assets, net	$	36,769		$	23,621
In-place lease valuation (below market)	$	(55,774	)	$	(48,448	)
In-place lease valuation (below market) - accumulated amortization	14,068			8,054
In-place lease valuation (below market), net	$	(41,706	)	$	(40,394	)
Tenant origination and absorption cost	$	516,879		$	359,416
Tenant origination and absorption cost - accumulated amortization	(119,593		)	(58,679		)
Tenant origination and absorption cost, net	$	397,286		$	300,737

The intangible assets are amortized over the remaining lease term of each property, which on a weighted-average basis, was approximately 7.8 years and 7.9 years as of December 31, 2015 and 2014, respectively. The amortization of the intangible assets and other leasing costs for the respective periods is as follows:

	Amortization (income) expense for the year ended December 31,
	2015			2014			2013
In-place lease valuation	$	(3,785	)	$	(468	)	$	(546	)
Tenant origination and absorption cost	$	69,099		$	45,044		$	14,098
Ground leasehold amortization (below market)	$	28		$	26		$	—
Other leasing costs amortization	$	301		$	143		$	—

The following table sets forth the estimated annual amortization (income) expense for in-place lease valuation, net, tenant origination and absorption costs, ground leasehold improvements, and other leasing costs as of December 31, 2015 for the next five years:

Year	In-place lease valuation, net			Tenant origination and absorption costs		Ground leasehold improvements		Other leasing costs
2016	$	1,028		$	63,111	$	28	$	1,000
2017	$	495		$	60,293	$	28	$	1,229
2018	$	(226	)	$	53,948	$	28	$	1,481
2019	$	(1,990	)	$	44,201	$	28	$	1,481
2020	$	(1,228	)	$	35,109	$	28	$	1,457

Restricted Cash

In conjunction with the contribution of certain assets, as required by certain lease provisions or certain lenders in conjunction with an acquisition or debt financing, or credits received by the seller of certain assets, the Company assumed or funded reserves for specific property improvements and deferred maintenance, re-leasing costs, and taxes and insurance, which are included on the consolidated balance sheets as restricted cash. Additionally, an ongoing replacement reserve is funded by certain tenants pursuant to each tenant’s respective lease as follows:

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

	Balance December 31, 2014		Additions		Deductions			Balance December 31, 2015
Tenant improvement reserves (1)	$	36,931	$	1,904	$	(25,942	)	$	12,893
Midland Mortgage loan repairs reserves (2)	453		—		—			453
Real estate tax reserve (Emporia Partners, TW Telecom, DynCorp, and Mercedes-Benz) (3)	1,074		2,601		(1,784		)	1,891
Property insurance reserve (Emporia Partners) (3)	251		494		(444		)	301
Restricted deposits	20		—		—			20
Midland Mortgage loan restricted lockbox (4)	2,023		2,044		(2,023		)	2,044
Restricted rent receipts (5)	—		6,585		—			6,585
	$	40,752	$	13,628	$	(30,193	)	$	24,187

(1) Additions represent tenant improvement reserves funded by the tenant and held by the lender. Deductions represent tenant improvement reimbursements made to certain tenants during the current period.

(2) Represents a deferred maintenance reserve funded by the Company as part of the refinancing that occurred on February 28, 2013, whereby certain properties became collateral for the Midland Mortgage loan.

(3) Additions represent monthly funding of real estate taxes and insurance by the tenants during the current period. Deductions represent reimbursements to the tenant for payment of real estate taxes and insurance premiums made during the current period.

(4) As part of the terms of the Midland Mortgage loan, rent collections from the eight properties which serve as collateral thereunder are received in a designated cash collateral account which is controlled by the lender until the designated payment date, as defined in the loan agreement, and the excess cash is transferred to the operating account.

(5) Addition represents rent and prepaid rent received from the DreamWorks property from August 2015 through January 2016, which is to be held in escrow pending a tax-deferred real estate exchange, as permitted by Section 1031 of the Internal Revenue Code, with the sale of the Will Partners and LTI properties. Such exchange was completed on January 12, 2016, thus, releasing any restrictions on the DreamWorks rent receipts.

4. Investments

Investments in Unconsolidated Entities

On April 10, 2013, a Delaware Statutory Trust ("DST") affiliated with the Sponsor acquired a two-building, single-story office campus located in Nashville, Tennessee (the "HealthSpring property") for a purchase price of $36.4 million. The DST was then syndicated for $39.6 million which consists of mortgage debt of $23.6 million and an equity contribution of $16.0 million. The HealthSpring property is leased in its entirety pursuant to a tripe-net lease to HealthSpring, Inc. ("HealthSpring"), obligating HealthSpring to all costs and expenses to operate and maintain the property, including certain capital expenditures. On the acquisition date, the remaining term was approximately nine years. On April 12, 2013, the Company, through the Operating Partnership, acquired a 10% beneficial ownership interest in the DST, net of a 10% discount associated with offering expenses. The Operating Partnership has the ability to exercise two exchange rights in which it can acquire additional beneficial interests in the DST at fair value. The initial exchange right, which may be exercised by the Operating Partnership at any point after the beneficial owners have held their interest in the DST for at least one year, allows each investor to sell or retain its interest in the DST or exchange its interest in the DST for units in the Operating Partnership ("the Units"). The secondary exchange right, which may not be exercised by the Operating Partnership until at least five years after the date of the agreement, allows each investor to either exchange their interest in the DST for units in the Operating Partnership or cash.

As of December 31, 2015, the Operating Partnership had exercised its initial exchange right. Approximately 73% of the beneficial owners of HealthSpring interests elected to exchange their interest in the DST for the Units, and the remaining 27% elected to be paid in cash. Until a contribution agreement is executed, the beneficial owners can change their contribution election or remain in the DST. The exchange is expected to be completed in the first quarter of 2016.

On September 9, 2014, the Company, through a special purpose entity ("SPE"), wholly-owned by the Operating Partnership, acquired an 80% interest in a joint venture with an affiliate of Digital Realty Trust, Inc. for $68.4 million, which was funded with equity proceeds raised in the Company's Public Offering. The gross acquisition value of the property was $187.5 million, plus closing costs, which was partially acquired with debt of $102.0 million. The joint venture was created for purposes of directly or indirectly acquiring, owning, financing, operating and maintaining a data center facility located in Ashburn, Virginia (the "Property"). The Property is approximately 132,300 square feet and consists of certain data processing and communications equipment that is fully leased to a social media company and a financial services company with an average remaining lease term of approximately seven years.

The joint venture currently uses an interest rate swap to manage its interest rate risk associated with its variable rate debt. The interest rate swap is designated as an interest rate hedge of its exposure to the volatility associated with interest rates. As a

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

result of the hedge designation and in satisfying the requirement for cash flow hedge accounting, the joint venture records changes in the fair value in accumulated other comprehensive loss. In conjunction with the investment in the joint venture discussed above, the Company recognized its 80% share, or approximately $(0.2) million, of other comprehensive loss for the year ended December 31, 2015.

The interests discussed above are deemed to be a variable interest in a VIE, and, based on an evaluation of the variable interest against the criteria for consolidation, the Company determined that it is not the primary beneficiary of the investments, as the Company does not have power to direct the activities of the entity that most significantly affect its performance. As such, the interests in the VIEs are recorded using the equity method of accounting in the accompanying consolidated financial statements. Under the equity method, the investments in the unconsolidated entities are stated at cost and adjusted for the Company's share of net earnings or losses and reduced by distributions. Equity in earnings of real estate ventures is generally recognized based on the allocation of cash distributions upon liquidation of the investment at book value in accordance with the operating agreements.

As of December 31, 2015, the balance of the investments totaled approximately $56.9 million as shown below:

	HealthSpring DST			Digital Realty Joint Venture			Total
Balance December 31, 2014	$	1,351		$	64,898		$	66,249
Other comprehensive loss	—			(189		)	(189		)
Net income (loss)	35			(1,510		)	(1,475		)
Distributions	(95		)	(7,627		)	(7,722		)
Balance December 31, 2015	$	1,291		$	55,572		$	56,863

Investments in Consolidated Entities

Effective June 16, 2014, WRRH Patterson, LLC (an affiliate of Weeks Robinson Properties) and Griffin Capital JVII Patterson, LLC, a wholly-owned SPE of the Operating Partnership, entered into an operating agreement as Managing Member and Investor Member, respectively, for purposes of forming WR Griffin Patterson, LLC ("WR Griffin"). WR Griffin's purpose is to acquire, own, develop, construct, and otherwise invest and manage a development project located in Patterson, California (the "Project") in which a warehouse and distribution facility consisting of approximately 1.5 million square feet was subsequently constructed (the "Restoration Hardware property").

On June 20, 2014, the Company, through WR Griffin, entered into a real estate development agreement with Weeks Robinson Development & Management, LLC ("Weeks Robinson") to develop and construct the Restoration Hardware property. Concurrently, the land on which the property was to be constructed was purchased by WR Griffin for approximately $15.2 million, including closing costs.

The Restoration Hardware property is leased to Restoration Hardware, Inc. and Restoration Hardware Holdings, Inc. as co-tenants (collectively, "Restoration Hardware") pursuant to a 15-year triple-net lease, obligating Restoration Hardware to all costs and expenses to operate and maintain the property, including certain capital expenditures. The lease term commenced upon substantial completion of the project, which occurred on August 15, 2015.

During the construction of the Project, the business and affairs of WR Griffin were managed by the Managing Member. However, all major decisions, as provided in the operating agreement, were approved by both the Managing Member and Investor Member. Additionally, the Managing Member interest, pursuant to the purchase and sale agreement, has been assigned to the Investor Member in exchange for a mandatory redemption fee based on the fair value of the property at completion. As a result of the assignment, the Managing Member will transfer all membership interest to the Investor Member upon completion of certain terms included in the operating agreement, which is expected to occur in the first quarter in 2016.

The Company determined that control of the joint venture lies with its wholly-owned SPE. As such, the Company, in consolidation with the joint venture, included the following amounts on its consolidated balance sheet as of December 31, 2015 and 2014:

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

	Balance December 31, 2015				Balance December 31, 2014
Cash on hand	$	4,711			$	6,985
Deferred rent	372				—
Other assets	59				—
Construction in progress - paid by the joint venture	—				34,739
Construction in progress - paid by the Company	—				70
Leasing commissions, net	731				375
Land	15,463			(1)	15,185
Building	57,595			(1)	—
Tenant improvements	18,040			(1)	—
Accumulated depreciation	(1,314		)		—
Construction in progress payable	—				(13,423		)
Accounts payable and other liabilities	(21,979		)		—
Due to affiliates	(3,324		)		—
Noncontrolling interest	—				(7,656		)
Total investment	$	70,354			$	36,275

(1) Includes $3.0 million of acquisition fees and expense reimbursements, as discussed in Note 3, Real Estate.

Transfer of construction in progress to fixed assets

The Company is required to capitalize project costs, including pre-development costs, interest, property taxes, insurance, and other costs directly related and essential to the acquisition, development, redevelopment, or construction of a project. Capitalization of development, redevelopment, and construction costs is required while activities are ongoing to prepare an asset for its intended use. When construction activities are substantially complete, the asset is transferred out of construction in progress and classified as rental property. On August 15, 2015, the Project was substantially complete and ready for its intended use, at which time Restoration Hardware began to occupy the facility and the lease commenced. Concurrent with the property being delivered to Restoration Hardware, the Company allocated the construction in progress balance between building and tenant improvements and began to depreciate the assets over the estimated useful lives.

Mandatory redemption

As noted above, the Managing Member's interest pursuant to the purchase and sale agreement has been assigned to the Investor Member in exchange for a mandatory redemption fee. As a result of the assignment, the Managing Member will transfer all membership interest to the Investor Member upon satisfying certain terms included in the operating agreement, including the completion of the Project and payment of the mandatory redemption fee, which is based on the estimated fair value of the property at completion. As of December 31, 2015, the Company agreed to pay the mandatory redemption fee of approximately $18.1 million, thus, reclassifying the noncontrolling interest from temporary equity to a liability on the consolidated balance sheet. The redemption of the Managing Member's interest includes their initial contribution of approximately $7.7 million.

5.     Debt

As of December 31, 2015 and 2014, the Company’s debt consisted of the following:

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

	Balance December 31, 2015			Balance December 31, 2014		Contractual Interest Rate (1)		Payment Type	Loan Maturity
Plainfield mortgage loan	$	19,295		$	19,638	6.650%		Principal and Interest	November 2017
Emporia Partners mortgage loan	3,753			4,108		5.880%		Principal and Interest	September 2023
LTI mortgage loan	—			32,128		5.800%		Principal and Interest	March 2016
LTI mortgage loan premium	—			102		—		—	—
TransDigm mortgage loan	6,432			6,576		5.980%		Principal and Interest	June 2016
TransDigm mortgage loan premium	22			75		—		—	—
Ace Hardware mortgage loan	23,294			23,648		5.588%		Principal and Interest	October 2024
Ace Hardware mortgage loan premium	1,508			1,681		—		—	—
Highway 94 mortgage loan	18,968			—		3.750%		Principal and Interest	August 2024
Highway 94 mortgage loan discount	(2,210		)	—		—		—	—
DynCorp mortgage loan	11,162			—		4.700%		Principal and Interest	July 2016
Mercedes-Benz mortgage loan	18,945			—		6.018%		Principal and Interest	November 2016
Samsonite mortgage loan	24,561			—		6.080%		Principal and Interest	September 2023
Samsonite mortgage loan premium	1,490			—		—		—	—
Midland Mortgage loan	105,600			105,600		3.940%		Interest Only through March 2017/Principal and Interest thereafter	April 2023
AIG loan	110,640			110,640		4.960%		Interest Only through January 2017/Principal and Interest thereafter	February 2029
TW Telecom loan	21,213			21,500		LIBO Rate +2.45%	(2)	Interest Only through July 2015/Principal and Interest thereafter	August 2019
Mortgage Loan Total	364,673			325,696
Unsecured term loan (May 2014)	—			300,000		LIBO Rate +1.45%		Interest Only	May 2019
Term Loan (July 2015)	640,000			—		LIBO Rate +1.25%	(2)	Interest Only	July 2020
Revolver Loan (July 2015)	481,653			—		LIBO Rate +1.30%	(2)	Interest Only	July 2020	(3)
Total	$	1,486,326		$	625,696

(1) Including the effect of an interest rate swap agreement with a notional amount of $425.0 million, the weighted average interest rate as of December 31, 2015 was 2.8% for the Company's fixed-rate and variable-rate debt combined and approximately 3.8% for the Company's fixed-rate debt only.

(2) The LIBO Rate as of December 31, 2015 was 0.30% (effective as of December 11, 2015).

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December 31, 2015

(Dollars in thousands unless otherwise noted)

(3) The Revolver Loan (July 2015) has an initial term of four years, maturing on July 20, 2019, and may be extended for a one-year period if certain conditions are met and upon payment of an extension fee. See discussion below.

Unsecured Credit Facility (July 2015)

On July 20, 2015, the Company, through the Operating Partnership, entered into a credit agreement (the "Unsecured Credit Agreement (July 2015)") with a syndicate of lenders, co-led by KeyBank, Bank of America, Fifth Third Bank ("Fifth Third"), and BMO Harris Bank, N.A. ("BMO Harris"), under which KeyBank serves as administrative agent and Bank of America, Fifth Third, and BMO Harris serve as co-syndication agents, and KeyBanc Capital Markets ("KeyBank Capital Markets"), Merrill Lynch, Pierce, Fenner & Smith Incorporated ("Merrill Lynch"), Fifth Third, and BMO Capital Markets serve as joint bookrunners and joint lead arrangers. Pursuant to the Unsecured Credit Agreement (July 2015), the Company was provided with a $1.14 billion senior unsecured credit facility (the "Unsecured Credit Facility (July 2015)"), consisting of a $500.0 million senior unsecured revolver (the "Revolver Loan (July 2015)") and a $640.0 million senior unsecured term loan (the "Term Loan (July 2015)"). The Unsecured Credit Facility (July 2015) may be increased up to $860.0 million, in minimum increments of $50.0 million, for a maximum of $2.0 billion by increasing either the Revolver Loan (July 2015), the Term Loan (July 2015), or both. The Revolver Loan (July 2015) has an initial term of four years, maturing on July 20, 2019, and may be extended for a one year period if certain conditions are met and upon payment of an extension fee. The Term Loan (July 2015) has a term of five years, maturing on July 20, 2020.

The Unsecured Credit Facility (July 2015) has an interest rate calculated based on LIBO Rate plus the applicable LIBO Rate margin or Base Rate plus the applicable Base Rate margin, both as provided in the Unsecured Credit Agreement (July 2015). The applicable LIBO Rate margin and Base Rate margin are dependent on whether the interest rate is calculated prior to or after the Company has received an investment grade senior unsecured credit rating of BBB-/Baa3 from Standard & Poors, Moody's, or Fitch, and the Company has elected to utilize the investment grade pricing list, as provided in the Unsecured Credit Agreement (July 2015). Otherwise, the applicable LIBO Rate margin will be based on a leverage ratio computed in accordance with the Company's quarterly compliance package and communicated to KeyBank. The Base Rate is calculated as the greater of (i) the KeyBank Prime rate or (ii) the Federal Funds rate plus 0.50%. Payments under the Unsecured Credit Facility (July 2015) are interest only and are due on the first day of each quarter. In connection with the Unsecured Credit Agreement (July 2015), the Company incurred approximately $4.1 million of deferred financing costs, which are being amortized as a component of interest expense over the term of the agreement.

Highway 94 Mortgage Loan

As part of the acquisition of the Highway 94 property, the Company assumed a $19.0 million mortgage loan (the "Highway 94 mortgage loan") from Wells Fargo Bank Northwest, N.A., and Teachers Insurance and Annuity Association, as participating holder of the note. The Highway 94 mortgage loan matures on August 1, 2024, has a fixed interest rate of 3.75%, and requires monthly payments of principal and interest.

DynCorp Mortgage Loan, Mercedes-Benz Mortgage Loan, and Samsonite Mortgage Loan

On December 11, 2015, the Company, through three wholly-owned subsidiaries of the Operating Partnership, assumed the following property mortgage loans related to the acquisition of the following three properties:

• DynCorp - Approximately $11.2 million, secured by the DynCorp property (the "DynCorp mortgage loan"). The DynCorp mortgage loan has a fixed interest rate of 4.70%, matures in July 2016, and requires monthly principal and interest payments.

• Mercedes-Benz - Approximately $18.9 million, secured by the Mercedes-Benz property (the "Mercedes-Benz mortgage loan"). The Mercedes-Benz mortgage loan has a fixed interest rate of 6.018%, matures in November 2016, and requires monthly principal and interest payments.

• Samsonite - Approximately $24.6 million, secured by the Samsonite property (the "Samsonite mortgage loan"). The Samsonite mortgage loan has a fixed interest rate of 6.08%, matures in September 2023, and requires monthly principal and interest payments.

Debt Covenant Compliance

Pursuant to the terms of the Midland Mortgage loan, AIG loan, TW Telecom loan, Unsecured Credit Facility (July 2015), DynCorp mortgage loan, and Mercedes-Benz mortgage loan, the Operating Partnership, in consolidation with the Company, is subject to certain loan compliance covenants. The Company was in compliance with all of its debt covenants for each quarter of 2015 and as of December 31, 2015.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

The following summarizes the future principal repayments of all loans as of December 31, 2015 per the loan terms discussed above:

	December 31, 2015
2016	$	40,078	(1)
2017	22,237		(2)
2018	7,077
2019	25,153		(3)
2020	1,128,486		(4)
Thereafter	262,485		(4)
Total principal	1,485,516
Unamortized debt premium	810
Total	$	1,486,326

(1) Amount includes payment of the balances of the TransDigm, DynCorp, and Mercedes-Benz property mortgage loans, which mature in 2016.

(2) Amount includes payment of the balance of the Plainfield property mortgage loan, which matures in 2017.

(3) Amount includes payment of the balance of the TW Telecom loan, which matures in 2019.

(4) Amount includes payment of the balances of:

• the Term Loan (July 2015), which matures in 2020,

• the Revolver Loan (July 2015), which matures in 2020, assuming the one-year extension is exercised,

• the Midland Mortgage, Emporia Partners, and Samsonite property mortgage loans, all of which mature in 2023,

• the Ace Hardware and Highway 94 property mortgage loans, which mature in 2024, and

• the AIG loan, which matures in 2029.

Principal repayments on the TransDigm, Ace Hardware, Highway 94, and Samsonite property mortgage loans do not include the unamortized valuation net premium of $0.8 million.

6.     Interest Rate Contracts

Risk Management Objective of Using Derivatives

The Company is exposed to certain risks arising from both business operations and economic conditions. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of debt funding and the use of derivative financial instruments. Specifically, the Company entered into derivative financial instruments to manage exposures that arise from business activities that result in the payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The derivative financial instruments are used to manage differences in the amount, timing, and duration of known or expected cash payments principally related to borrowings.

Derivative Instruments

The objectives in using interest rate derivatives are to add stability to interest expense and to manage exposure to interest rate movements. To accomplish this objective, the Company uses interest rate swaps as part of interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. The Company does not use derivatives for trading or speculative purposes.

On July 9, 2015, the Company executed three interest rate swap agreements to hedge the variable cash flows associated with certain existing LIBO Rate-based variable-rate debt, including the Company's Unsecured Credit Facility (July 2015). The first interest rate swap is effective for the period from July 9, 2015 to July 1, 2020 with a notional amount of $425.0 million. The two forward-starting interest rate swap transactions are effective for the periods from January 1, 2016 to July 1, 2018 and July 1, 2016 to July 1, 2018, and have notional amounts of $300.0 million and $100.0 million, respectively.

The effective portion of the change in fair value of derivatives designated and qualifying as cash flow hedges is initially recorded in accumulated other comprehensive income (loss) and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. Amounts reported in accumulated other comprehensive income (loss) related to derivatives will be reclassified to interest expense as interest payments and accruals are made on our variable-rate debt. During the next twelve months, the Company estimates that an additional $6.5 million will be released from accumulated other comprehensive income (loss) into earnings.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

During the year ended December 31, 2015, the amount of income (loss) into earnings under "interest expense" was approximately $3.1 million. The ineffective portion of the change in fair value of the derivatives is immediately recognized in earnings. During the year ended December 31, 2015, the Company recognized, in earnings, less than $0.1 million related to the ineffective portion of the interest rate swaps.

The following table sets forth a summary of the interest rate swaps at December 31, 2015:

		Maturity	Interest	Fair value (2)			Current Notional Amount (3)
Derivative Instrument	Effective Date (1)	Date	Strike Rate	December 31, 2015			December 31, 2015
Liabilities:
Interest Rate Swap	7/9/2015	7/1/2020	1.687%	$	(4,305	)	$	425,000
Interest Rate Swap	1/1/2016	7/1/2018	1.320%	$	(1,605	)	$	—
Interest Rate Swap	7/1/2016	7/1/2018	1.495%	$	(484	)	$	—

(1) The Company entered into all interest rate swap agreements in 2015. Thus, no prior period information is available.

(2) The Company records all derivative instruments on a gross basis on the consolidated balance sheets, and accordingly, there are no offsetting amounts that net assets against liabilities. As of December 31, 2015, all of the derivatives were in a liability position, and as such, the fair value is included in the line item "Interest rate swap liability" on the consolidated balance sheets.

(3) Represents the notional amount of swaps that are effective as of the balance sheet date of December 31, 2015.

Certain agreements with the derivative counterparties contain a provision where if the Company defaults on any of the Company's indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender within a specified time period, then the Company could also be declared in default on its derivative obligations.

As of December 31, 2015, the fair value of interest rate swaps in a net liability position, which excludes any adjustment for nonperformance risk related to these agreements, was approximately $6.4 million. As of December 31, 2015, the Company had not posted any collateral related to these agreements.

7.     Fair Value Measurements

The Company is required to disclose fair value information about all financial instruments, whether or not recognized in the consolidated balance sheets, for which it is practicable to estimate fair value. The Company measures and discloses the estimated fair value of financial assets and liabilities utilizing a fair value hierarchy that distinguishes between data obtained from sources independent of the reporting entity and the reporting entity’s own assumptions about market participant assumptions. This hierarchy consists of three broad levels, as follows: (i) quoted prices in active markets for identical assets or liabilities, (ii) "significant other observable inputs," and (iii) "significant unobservable inputs." "Significant other observable inputs" can include quoted prices for similar assets or liabilities in active markets, as well as inputs that are observable for the asset or liability, such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals. "Significant unobservable inputs" are typically based on an entity’s own assumptions, since there is little, if any, related market activity. In instances in which the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level of input that is significant to the fair value measurement in its entirety. The Company's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. There were no transfers between the levels in the fair value hierarchy during the years ended December 31, 2015 and 2014.

The following tables set forth the liabilities that the Company measures at fair value on a recurring basis by level within the fair value hierarchy as of December 31, 2015:

Liabilities	Total Fair Value			Quoted Prices in Active Markets for Identical Assets and Liabilities		Significant Other Observable Inputs			Significant Unobservable Inputs
Interest Rate Swaps at (1):
December 31, 2015	$	(6,394	)	$	—	$	(6,394	)	$	—

(1) The Company entered into all interest rate swap agreements in 2015. Thus, no prior period information is available.

Financial Instruments Disclosed at Fair Value

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

Financial instruments as of December 31, 2015 consisted of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and other accrued expenses, and mortgage payable and other borrowings, as defined in Note 5, Debt. With the exception of the mortgage loans in the table below, the amounts of the financial instruments presented in the consolidated financial statements substantially approximate their fair value as of December 31, 2015 and 2014. The fair value of the 11 mortgage loans in the table below is estimated by discounting each loan’s principal balance over the remaining term of the mortgage using current borrowing rates available to the Company for debt instruments with similar terms and maturities. The Company determined that the mortgage debt valuation in its entirety is classified Level 2 of the fair value hierarchy, as the fair value is based on current pricing for debt with similar terms as the in-place debt.

	December 31, 2015				December 31, 2014
	Fair Value		Carrying Value (1)		Fair Value		Carrying Value (1)
Plainfield mortgage loan	$	20,240	$	19,295	$	20,994	$	19,638
Emporia Partners mortgage loan	3,742		3,753		4,434		4,108
LTI mortgage loan	—		—		32,742		32,128
TransDigm mortgage loan	6,432		6,432		6,748		6,576
Ace Hardware mortgage loan	23,778		23,294		26,424		23,648
Midland Mortgage loan	107,154		105,600		105,155		105,600
AIG loan	114,747		110,640		122,062		110,640
Highway 94 mortgage loan	17,658		18,968		—		—
DynCorp mortgage loan (2)	11,162		11,162		—		—
Mercedes-Benz mortgage loan (2)	18,945		18,945		—		—
Samsonite mortgage loan	26,044		24,561		—		—

(1) The carrying value of the TransDigm, Ace Hardware, Highway 94, and Samsonite property mortgage loans do not include the net debt premium of $0.8 million and $1.9 million as of December 31, 2015 and 2014, respectively. See Note 5, Debt, for details.

(2) The fair value is identical to the carrying value as of December 31, 2015 since all three property mortgage loans mature in 2016.

8.     Equity

Preferred Equity

On November 5, 2013, in connection with the acquisition of the Investment Grade Portfolio, a portfolio of 18 properties, the Operating Partnership entered into a purchase agreement with an affiliate (the "Preferred Equity Investor") of Starwood Property Trust (“Starwood”), pursuant to which Starwood provided a $250.0 million equity investment in the Operating Partnership in exchange for 24,319,066 Series A Cumulative Exchangeable Preferred Units of limited partnership interest (the "Preferred Units") of the Operating Partnership. Pursuant to the terms of the purchase agreement, on May 14, 2015 and November 5, 2015, the Company, through the Operating Partnership, exercised its right to redeem the Preferred Units for $191.6 million and $64.1 million, respectively, including a liquidation preference and all accumulated and unpaid distributions. Effective November 5, 2015, the preferred equity investment was terminated.

Common Equity

As of December 31, 2015, the Company had received aggregate gross offering proceeds of approximately $1.4 billion from the sale of shares in the Private Offering, the Public Offerings, and the DRP Offerings, as discussed in Note 1, Organization. There were 175,184,519 shares outstanding at December 31, 2015, including shares issued pursuant to the DRP, less shares redeemed pursuant to the share redemption plan discussed below.

On October 22, 2015, the Company's board of directors, at the recommendation of the nominating and corporate governance committee comprised solely of independent directors, approved an estimated value per share of the Company's common stock of $10.40 (unaudited) based on the estimated value of the Company's assets less the estimated value of the Company's liabilities, or net asset value, divided by the number of shares outstanding on a fully diluted basis (the "NAV"), calculated as of September 30, 2015. The Company is providing this estimated value per share to assist broker dealers in connection with their obligations under applicable Financial Industry Regulatory Authority rules with respect to customer account statements. This valuation was performed in accordance with the provisions of Practice Guideline 2013-01, Valuations of Publicly Registered Non-Listed REITs, issued by the IPA in April 2013, in addition to guidance from the SEC.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

The Company’s par value calculation and related additional paid in capital ("APIC") allocation from the inception of the offering was determined to be calculated incorrectly. The Company assessed the cumulative impact of the reclassification between the par value and APIC from inception and recorded a reduction to the par value of $1.2 million and a corresponding increase to APIC for the same amount to correct the balances as of December 31, 2015. In accordance with SEC Staff Accounting Bulletin (“SAB”) No. 99, Materiality and SAB No. 108 (“SAB 108”), Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements, the Company assessed the materiality of this correction on its consolidated financial statements for the year ended December 31, 2015, using both the roll-over method and iron-curtain method as defined in SAB 108. The Company concluded the effect was not material to its consolidated financial statements for any prior period and, as such, those financial statements are not materially misstated. The Company also concluded that recording the correction in 2015 did not have a material effect on its consolidated financial statements for the year ended December 31, 2015.

Distribution Reinvestment Plan (DRP)

The Company has adopted the DRP, which allows stockholders to have dividends and other distributions otherwise distributable to them invested in additional shares of common stock. No sales commissions or dealer manager fee will be paid on shares sold through the DRP. The Company may amend or terminate the DRP for any reason at any time upon 10 days' prior written notice to stockholders.

As of December 31, 2015 and 2014, $110.2 million and $57.7 million in shares of common stock, respectively, had been issued under the DRP, pursuant to the Private Offering, the Public Offerings, and the DRP Offerings.

Share Redemption Program

The Company has adopted a share redemption program ("SRP") that enables stockholders to sell their stock to the Company in limited circumstances. As long as the common stock is not listed on a national securities exchange or over-the-counter market, stockholders who have held their stock for at least one year may, under certain circumstances, be able to have all or any portion of their shares of stock redeemed by the Company. The Company may redeem, on a quarterly basis, the shares of stock presented for redemption for cash to the extent that there are sufficient funds available to fund such redemptions. In no event shall the Company redeem more than 5.0% of the weighted average shares outstanding during the prior calendar year, and the cash available for redemption will be limited to the proceeds from the sale of shares pursuant to the DRP. Effective March 17, 2013, the redemption price per share shall be as shown below, which is based upon the number of years the stock is held:

Period of Time Held	Redemption Price
At least one year	Lower of $9.25 or the price paid by the stockholder
At least two years	Lower of $9.50 or the price paid by the stockholder
At least three years	Lower of $9.75 or the price paid by the stockholder
At least four years	Lower of $10.28 or the price paid by the stockholder

As the use of the proceeds from the DRP for redemptions is outside the Company’s control, the net proceeds from the DRP are considered to be temporary equity and are presented as common stock subject to redemption on the accompanying consolidated balance sheets. The cumulative proceeds from the DRP, net of any redemptions, will be computed at each reporting date and will be classified as temporary equity on the Company’s consolidated balance sheets. As noted above, the redemption is limited to proceeds from new permanent equity from the sale of shares pursuant to the DRP.

Redemption requests will be honored on or about the last business day of the month following the end of each quarter. Requests for redemption must be received on or prior to the end of the quarter in order for the Company to repurchase the shares as of the end of the following month. Since inception and through December 31, 2015, the Company had redeemed 1,753,700 shares of common stock for approximately $17.3 million at a weighted average price per share of $9.88 pursuant to the SRP. As of December 31, 2015, there were 638,483 shares totaling $6.3 million subject to redemption requests. The Company’s board of directors may choose to amend, suspend, or terminate the SRP upon 30 days' written notice at any time.

Noncontrolling Interests

Noncontrolling interests represent limited partnership interests in the Operating Partnership in which the Company is the general partner. General Partnership units and limited partnership units of the Operating Partnership were issued as part of the

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

initial capitalization of the Operating Partnership, and limited partnership units were issued in conjunction with management's contribution of certain assets, as discussed in Note 1, Organization.

As of December 31, 2015, noncontrolling interests were approximately 3% of total shares outstanding and approximately 3% of weighted average shares outstanding (both measures assuming limited partnership units were converted to common stock). The Company has evaluated the terms of the limited partnership interests in the Operating Partnership and as a result, has classified limited partnership interests issued in the initial capitalization and in conjunction with the contributed assets as noncontrolling interests, which are presented as a component of permanent equity, except as discussed below.

The Company evaluates individual noncontrolling interests for the ability to recognize the noncontrolling interest as permanent equity on the consolidated balance sheets at the time such interests are issued and on a continual basis. Any noncontrolling interest that fails to qualify as permanent equity has been reclassified as temporary equity and adjusted to the greater of (a) the carrying amount, or (b) its redemption value as of the end of the period in which the determination is made.

The Operating Partnership issued 5.5 million limited partnership units to affiliated parties and unaffiliated third parties in exchange for certain properties and 0.1 million limited partnership units to unaffiliated third parties unrelated to property contributions. To the extent the contributors should elect to redeem all or a portion of their Operating Partnership units, pursuant to the terms of the respective contribution agreement, such redemption shall be at a per unit value equivalent to the price at which the contributor acquired its limited partnership units in the respective transaction.

The limited partners of the Operating Partnership, other than those related to the Will Partners REIT, LLC (Will Partners property) contribution, will have the right to cause the general partner of the Operating Partnership, the Company, to redeem their limited partnership units for cash equal to the value of an equivalent number of shares, or, at the Company’s option, purchase their limited partnership units by issuing one share of the Company’s common stock for the original redemption value of each limited partnership unit redeemed. These rights may not be exercised under certain circumstances which could cause the Company to lose its REIT election. There were no redemption requests during the years ended December 31, 2015 and 2014.

The following summarizes the activity for noncontrolling interests recorded as equity for the years ended December 31, 2015, 2014, and 2013:

	Year Ended December 31,
	2015			2014			2013
Beginning balance	$	17,478		$	19,736		$	17,512
Contribution/issuance of noncontrolling interests	7,282			1,504			8,095
Distributions to noncontrolling interests	(3,150		)	(3,050		)	(2,730		)
Allocated distributions to noncontrolling interests subject to redemption	(10		)	(14		)	(49		)
Net loss	(138		)	(698		)	(3,092		)
Other comprehensive loss	(144		)	—			—
Ending balance	$	21,318		$	17,478		$	19,736

Noncontrolling interests subject to redemption

Operating partnership units issued pursuant to the Will Partners REIT, LLC contribution are not included in permanent equity on the consolidated balance sheets. The partners holding these units can cause the general partner to redeem the units for the cash value, as defined in the operating partnership agreement. As the general partner does not control these redemptions, these units are presented on the consolidated balance sheets as noncontrolling interest subject to redemption at their redeemable value. The net income (loss) and distributions attributed to these limited partners is allocated proportionately between common stockholders and other noncontrolling interests that are not considered redeemable.

At December 31, 2014, noncontrolling interests subject to redemption include Weeks Robinson's interest in the joint venture, the real estate developer engaged to develop and construct the Restoration Hardware property. The interest in the joint venture is deemed to be a variable interest in a VIE, and based on an evaluation of the variable interest against the criteria for consolidation, the Company determined that it is the primary beneficiary of the investment. As such, the interest in the VIE is recorded using the consolidation method of accounting in the accompanying consolidated financial statements. Under the consolidation method, the Company includes the assets, liabilities, noncontrolling interests, and results of activities of the VIE in its consolidated financial statements. Since the Project was substantially completed in 2015, and the Company agreed to pay

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

the mandatory redemption fee, the Company reclassified the noncontrolling interest from temporary equity to a liability as of December 31, 2015. See Note 4, Investments.

9.     Related Party Transactions

The following table summarizes the related party costs and fees incurred, paid and due to affiliates as of December 31, 2015 and 2014:

	As of December 31, 2014			Year Ended December 31, 2015
	Payable			Incurred			Paid		Payable
Advisor and Property Manager fees
Acquisition fees and expenses	—			35,210		(1)	32,245		2,965
Operating expenses/leasing commissions	202			3,713			1,738		2,177
Asset management fees	1,189			18,753			17,818		2,124
Property management fees	460			7,149			6,411		1,198
Disposition fees (2)	—			640			353		287
Costs advanced by the Advisor	—			53			47		6
Total, net of real estate assets held for sale	1,851			65,518			58,612		8,757
Asset management fees related to real estate held for sale (3)	65			636			657		44
Property management fees related to real estate held for sale (3)	39			473			475		37
Total	$	1,955	(1)	$	66,627		$	59,744	$	8,838

(1)     Includes approximately $3.0 million of acquisition fees and expense reimbursements related to the Restoration Hardware property, as discussed in Note

3, Real Estate, which are also included in the basis of the property.

(2)     The disposition expense represents fees incurred from the sale of the College Park, Will Partners, and LTI properties.

(3)     Represents asset management fees and property management fees for the College Park, Will Partners, and One Century Place properties.

Mortgage Receivable from Affiliate

On October 9, 2015, the Company entered into a mortgage receivable for approximately $26.0 million related to a 127,246 square foot, single-story office building located in Emeryville, CA. The borrower is an affiliated tenant-in-common private program or LLC, each with the Sponsor as the asset manager. The mortgage receivable had a rate of 8% per annum and was funded with proceeds from the Unsecured Credit Facility (July 2015). The mortgage receivable was paid in full on January 15, 2016.

Advisory Agreement

The Company currently does not have nor does it expect to have any employees. The Advisor will be primarily responsible for managing the business affairs and carrying out the directives of the Company’s board of directors. The Company entered into an advisory agreement with the Advisor for the Public Offerings. The Advisory Agreement entitles the Advisor to specified fees and incentives upon the provision of certain services with regard to the Public Offerings and investment of funds in real estate properties, among other services, as well as reimbursement for organizational and offering costs incurred by the Advisor on the Company’s behalf and reimbursement of certain costs and expenses incurred by the Advisor in providing services to the Company.

The Advisory Agreement requires, upon termination of the Public Offerings, that any organizational and offering costs, including sales commissions and dealer manager fees, incurred above 15% of gross equity raised in the Company’s Public Offerings and that any organizational and offering costs not including sales commissions and dealer manager fees, incurred above 3.5% of gross equity raised in the Company’s Public Offerings shall be reimbursed to the Company. Upon termination of the Public Offerings, organizational and offering costs did not exceed the limitations for organizational and offering costs the Advisor is subject to, as discussed in Note 2, Basis of Presentation and Summary of Significant Accounting Policies - Organizational and Offering Costs.

Management Compensation

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

The following table summarizes the compensation and fees the Company has paid or may pay to the Advisor, the Property Manager, and the Sponsor and other affiliates, including amounts to reimburse costs for providing services.

Type of Compensation (Recipient)	Determination of Amount
Acquisition Fees and Expenses (Advisor)	Under the Advisory Agreement, the Advisor receives acquisition fees equal to 2.5%, and reimbursement for actual acquisition related expenses incurred by the Advisor of up to 0.50% of the contract purchase price, as defined therein, of each property acquired by the Company, and reimbursement for actual acquisition expenses incurred on the Company's behalf, including certain payroll costs for acquisition-related efforts by the Advisor's personnel, as defined in the agreements. In addition, the Company pays acquisition expenses to unaffiliated third parties equal to approximately 0.60% of the purchase price of the Company's properties. The acquisition fee and acquisition expenses paid by the Company shall be reasonable and in no event exceed an amount equal to 6.0% of the contract purchase price, unless approved by a majority of the independent directors.
Disposition Fee (Advisor)	In the event that the Company sells any or all of its properties (or a portion thereof), or all or substantially all of the business or securities of the Company are transferred or otherwise disposed of by way of a merger or other similar transaction, the Advisor will be entitled to receive a disposition fee if the Advisor or an affiliate provides a substantial amount of the services (as determined by a majority of the Company's directors, including a majority of the independent directors) in connection with such transaction. The disposition fee the Advisor or such affiliate shall be entitled to receive at closing will be equal to the lesser of: (1) 3% of the Contract Sales Price, as defined in the Advisory Agreement or (2) 50% of the Competitive Commission, as defined in the Advisory Agreement; provided, however, that in connection with certain types of transactions described further in the Advisory Agreement, the disposition fee shall be subordinated to Invested Capital (as defined in the operating partnership agreement). The disposition fee may be paid in addition to real estate commissions or other commissions paid to non-affiliates, provided that the total real estate commissions or other commissions (including the disposition fee) paid to all persons by the Company or the operating partnership shall not exceed an amount equal to the lesser of (i) 6% of the aggregate Contract Sales Price or (ii) the Competitive Commission.
Asset Management Fee (Advisor)	The Advisor receives an annual asset management fee for managing the Company’s assets equal to 0.75% of the Average Invested Assets, defined as the aggregate carrying value of the assets invested before reserves for depreciation. The fee will be computed based on the average of these values at the end of each month. The asset management fees are earned monthly.
Operating Expenses (Advisor)	The Advisor and its affiliates are entitled to reimbursement, at cost, for actual expenses incurred by them on behalf of the Company in connection with their provision of administrative services, including related personnel costs; provided, however, the Advisor must reimburse the Company for the amount, if any, by which total operating expenses (as defined), including advisory fees, paid during the previous 12 months then ended exceeded the greater of: (i) 2% of the Company’s average invested assets for that 12 months then ended; or (ii) 25% of the Company’s net income, before any additions to reserves for depreciation, bad debts or other expenses connected with the acquisition and disposition of real estate interests and before any gain from the sale of the Company’s assets, for that fiscal year, unless the Company’s board of directors has determined that such excess expenses were justified based on unusual and non-recurring factors. For the years ended December 31, 2015 and 2014, approximately $1.6 million and $1.0 million, respectively, of operating expenses incurred by the Advisor were allocated to the Company in each period. Such costs are allocated using methodologies meant to fairly allocate such costs based upon the related activities and in accordance with the agreement.

F-37

Table of Contents          GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

Type of Compensation (Recipient)	Determination of Amount
Property Management Fees (Property Manager)	The Property Manager is entitled to receive a fee for its services in managing the Company’s properties up to 3% of the gross monthly revenues from the properties plus reimbursement of the costs of managing the properties. The Property Manager, in its sole and absolute discretion, can waive all or a part of any fee earned. In the event that the Property Manager assists with the development or redevelopment of a property, the Company may pay a separate market-based fee for such services. In the event that the Company contracts directly with a non-affiliated third-party property manager with respect to a particular property, the Company will pay the Property Manager an oversight fee equal to 1% of the gross revenues of the property managed. In no event will the Company pay both a property management fee to the Property Manager and an oversight fee to the Property Manager with respect to a particular property. In addition, the Company may pay the Property Manager or its designees a leasing fee in an amount equal to the fee customarily charged by others rendering similar services in the same geographic area. The Company may also pay the Property Manager or its designees a construction management fee for planning and coordinating the construction of any tenant directed improvements for which the Company is responsible to perform pursuant to lease concessions, including tenant-paid finish-out or improvements. The Property Manager shall also be entitled to a construction management fee of 5% of the cost of improvements.
Subordinated Share of Net Sale Proceeds (Advisor) (1)	Payable to the Advisor in cash upon the sale of a property after the Company's stockholders receive a return of capital plus a 6% cumulative, non-compounded return. The share of net proceeds from the sale of property is 5% if stockholders are paid a return of capital plus 6% to 8% annual cumulative non-compounding return, 10% if stockholders are paid a return of capital plus 8% to 10% annual cumulative non-compounding return, or 15% if stockholders are paid a return of capital plus 10% or more annual cumulative non-compounding return.
Subordinated Incentive Listing Distribution (Advisor) (1)	Payable to the Advisor no earlier than 7 months and no later than 19 months following a listing of the shares on a national securities exchange, based upon the market value of the Company's shares during a period of 30 trading days commencing after the first day of the 6th month, but no later than the last day of the 18th month following a listing, the commencement date of which shall be chosen by the Advisor in its sole discretion, and after the Company's stockholders receive a return of capital plus a 6% cumulative, non-compounded return. The distribution share is 5% if stockholders are paid a return of capital plus 6% to 8% annual cumulative non-compounding return, 10% if stockholders are paid a return of capital plus 8% to 10% annual cumulative non-compounding return, or 15% if stockholders are paid a return of capital plus 10% or more annual cumulative non-compounding return, and is payable in cash, shares of the Company's stock, units of limited partnership interest in the Operating Partnership, or a combination thereof.
Subordinated Distribution Due Upon Termination (Advisor)	Payable to the Advisor (in cash, shares of the Company's stock, units of limited partnership interest in the Operating Partnership, or a combination thereof), 1/3rd within 30 days of the date of involuntary termination of the Advisory Agreement, 1/3rd upon the one year anniversary of such date, and 1/3rd upon the two year anniversary of such date. Calculated based upon appraised value of properties less the fair value of the underlying debt, and plus or minus net current assets or net current liabilities, respectively, and payable after the Company's stockholders receive a return of capital plus a 6% cumulative, non-compounded return. The distribution share is 5% if stockholders are paid a return of capital plus 6% to 8% annual cumulative non-compounding return, 10% if stockholders are paid a return of capital plus 8% to 10% annual cumulative non-compounding return, or 15% if stockholders are paid a return of capital plus 10% or more annual cumulative non-compounding return. Upon a voluntary termination of the Advisory Agreement, the Advisor will not be entitled to receive the Subordinated Distribution Due Upon Termination but instead will be entitled to receive at the time of the applicable liquidity event a distribution equal to the applicable Subordinated Share of Net Sale Proceeds, Subordinated Incentive Listing Distribution, or Subordinated Distribution Due Upon Extraordinary Transaction.
Subordinated Distribution Due Upon Extraordinary Transaction (Advisor) (1)	Payable to the Advisor upon the closing date of an Extraordinary Transaction (as defined in the Operating Partnership Agreement); payable in cash, shares of the Company's stock, units of limited partnership in the Operating Partnership, or a combination thereof after the Company's stockholders receive a return of capital plus a 6% cumulative, non-compounded return. The distribution share is 5% if stockholders are paid a return of capital plus 6% to 8% annual cumulative non-compounding return, 10% if stockholders are paid a return of capital plus 8% to 10% annual cumulative non-compounding return, or 15% if stockholders are paid a return of capital plus 10% or more annual cumulative non-compounding return.

F-38

Table of Contents          GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

Type of Compensation (Recipient)

Determination of Amount

Sponsor Break-Even Amount (Sponsor)

In the event of a merger of the Advisor into the Company or one of its affiliates in anticipation of listing or a merger with an already-listed entity, any merger consideration paid to the Company's sponsor or its affiliates in excess of unreturned and unreimbursed capital invested by the Company's sponsor and its affiliates into the Company, the Advisor, the Company's dealer manager, or affiliates, relating in any way to the business organization of the Company, the Operating Partnership, or any offering of the Company, shall be subordinated to the return of stockholders' invested capital. Such excess merger consideration shall be paid in stock that may not be traded for one year from the date of receipt, and such stock shall be held in escrow pending the occurrence of certain conditions outlined further in the Operating Partnership Agreement.

(1) The Advisor cannot earn more than one incentive distribution. Any receipt by the Advisor of subordinated share of net sale proceeds (for anything other than a sale of the entire portfolio) will reduce the amount of the subordinated distribution due upon termination, the subordinated incentive listing distribution and the subordinated distribution due upon extraordinary transaction.

Conflicts of Interest

The Sponsor, Advisor, Property Manager and their officers and certain of their key personnel and their respective affiliates currently serve as key personnel, advisors, managers and sponsors or co-sponsors to some or all of 11 other real estate programs affiliated with the Sponsor, including Griffin Capital Essential Asset REIT II, Inc. ("GCEAR II") and Griffin-American Healthcare REIT III, Inc. ("GAHR III"), both of which are publicly-registered, non-traded real estate investment trusts, Griffin-American Healthcare REIT IV, Inc. ("GAHR IV"), a non-traded real estate investment trust in registration as of December 31, 2015, Griffin-Benefit Street Partners BDC Corp. ("GB-BDC"), a non-traded business development company regulated under the 1940 Act, and Griffin Institutional Access Real Estate Fund ("GIREX"), a non-diversified, closed-end management investment company that is operated as an interval fund under the 1940 Act. Because these persons have competing demands on their time and resources, they may have conflicts of interest in allocating their time between the Company’s business and these other activities.

Some of the material conflicts that the Sponsor, Advisor, and Property Manager and their key personnel and their respective affiliates will face are (1) competing demand for time of the Advisor’s executive officers and other key personnel from the Sponsor and other affiliated entities; (2) determining if certain investment opportunities should be recommended to the Company or another program sponsored or co-sponsored by the Sponsor; and (3) influence of the fee structure under the Advisory Agreement and the distribution structure under the Operating Partnership Agreement that could result in actions not necessarily in the long-term best interest of the Company’s stockholders. The board of directors has adopted the Sponsor’s acquisition allocation policy as to the allocation of acquisition opportunities among the Company and GCEAR II, which is based on the following factors:

• the investment objectives of each program;

• the amount of funds available to each program;

• the financial impact of the acquisition on each program, including each program’s earnings and distribution ratios;

• various strategic considerations that may impact the value of the investment to each program;

• the effect of the acquisition on diversification of each program’s investments; and

• the income tax effects of the purchase to each program.

If, after consideration of these factors, the investment opportunity is suitable for the Company and for GCEAR II, then:

• the Company will have priority for investment opportunities of $75 million or greater; and

• GCEAR II will have priority for investment opportunities of $35 million or less, until such time as GCEAR II reaches $500 million in aggregate assets (based on contract purchase price).

In the event all acquisition allocation factors have been exhausted and an investment opportunity remains equally suitable for the Company and GCEAR II, the Sponsor will offer the investment opportunity to the REIT that has had the longest period of time elapse since it was offered an investment opportunity.

If the Sponsor no longer sponsors the Company, then, in the event that an investment opportunity becomes available that is suitable, under all of the factors considered by the Advisor, for both GCEAR II and one or more other entities affiliated with the Sponsor, the Sponsor has agreed to present such investment opportunities to GCEAR II first, prior to presenting such opportunities to any other programs sponsored by or affiliated with the Sponsor. In determining whether or not an investment

F-39

Table of Contents          GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2015

(Dollars in thousands unless otherwise noted)

opportunity is suitable for more than one program, the Advisor, subject to approval by the board of directors, shall examine, among others, the following factors:

• anticipated cash flow of the property to be acquired and the cash requirements of each program;

• effect of the acquisition on diversification of each program’s investments;

• policy of each program relating to leverage of properties;

• income tax effects of the purchase to each program;

• size of the investment; and

• amount of funds available to each program and the length of time such funds have been available for investment.

Economic Dependency

The Company will be dependent on the Advisor for certain services that are essential to the Company, including the identification, evaluation, negotiation, purchase and disposition of properties and other investments, management of the daily operations of the Company’s real estate portfolio, and other general and administrative responsibilities. In the event that the Advisor is unable to provide the services, the Company will be required to obtain such services from other resources.

10.     Commitments and Contingencies

Ground Lease Obligations

The Company acquired a property on January 16, 2014 that is subject to a ground lease with an expiration date of December 31, 2095. The Company incurred rent expense of approximately $0.4 million during the years ended December 31, 2015 and 2014, related to the ground lease. As of December 31, 2015, the remaining required payments under the terms of the ground lease are as follows:

	December 31, 2015
2016	$	180
2017	198
2018	198
2019	198
2020	198
Thereafter	34,048
Total	$	35,020

Litigation

From time to time, the Company may become subject to legal proceedings, claims and litigation arising in the ordinary course of business. The Company is not a party to any material legal proceedings, nor is the Company aware of any pending or threatened litigation that would have a material adverse effect on the Company’s business, operating results, cash flows or financial condition should such litigation be resolved unfavorably.

11.     Declaration of Distributions

During the quarter ended December 31, 2015, the Company paid distributions in the amount of $0.001901096 per day per share on the outstanding shares of common stock payable to stockholders of record at the close of business on each day during the period from October 1, 2015 through December 31, 2015. Such distributions were paid on a monthly basis, on or about the first day of the month, for the month then-ended.

On December 16, 2015, the Company’s board of directors declared distributions in the amount of $0.001895902 per day per share on the outstanding shares of common stock payable to stockholders of record at the close of business on each day during the period from January 1, 2016 through March 31, 2016. Such distributions payable to each stockholder of record during a month will be paid on such date of the following month as the Company’s Chief Executive Officer may determine.

12.     Selected Quarterly Financial Data (Unaudited)

F-40

Presented below is a summary of the unaudited quarterly financial information for the years ended December 31, 2015 and 2014:

	2015
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Total revenue	$	55,213		$	61,563		$	82,849		$	90,470
Net income (loss)	$	11,101		$	(11,655	)	$	4,005		$	12,170
Net income (loss) attributable to common stockholders	$	6,116		$	(21,409	)	$	1,544		$	9,999
Net loss per share	$	0.05		$	(0.15	)	$	0.01		$	0.06
	2014
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Total revenue	$	47,992		$	47,285		$	52,631		$	54,486
Net income (loss)	$	2,740		$	(7,990	)	$	381		$	4,883
Net loss attributable to common stockholders	$	(1,920	)	$	(12,378	)	$	(4,354	)	$	(2	)
Net loss per share	$	(0.03	)	$	(0.10	)	$	(0.03	)	$	(0.01	)

13.     Subsequent Events

Offering Status

As of March 4, 2016, the Company had issued approximately 9,414,932 shares of the Company’s common stock pursuant to the DRP Offerings for approximately $96.0 million.

Declaration of Distributions

On March 1, 2016, the Company’s board of directors declared distributions in the amount of $0.001895902 per day per share on the outstanding shares of common stock payable to stockholders of record at the close of business on each day during the period from April 1, 2016 through June 30, 2016. Such distributions payable to each stockholder of record during a month will be paid on such date of the following month as the Company’s Chief Executive Officer may determine.

F-41

GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

SCHEDULE III

REAL ESTATE AND ACCUMULATED DEPRECIATION

(in thousands)

					Initial Cost to Company				Cost  Capitalized Subsequent to Acquisition		Gross Carrying Amount at December 31, 2015										Life on which depreciation in latest income statement is computed
Property	Property Type	ST	Encumbrances		Land		Building and Improve-ments		Building and Improve-ments		Land		Building and Improve-ments		Total		Accumulated Depreciation		Date of Construction	Date of Acquisition
Plainfield	Office/Laboratory	IL	$	19,295	$	3,709	$	27,335	$	2,217	$	3,709	$	29,552	$	33,261	$	8,750	N/A	6/18/2009	5-40 years
Renfro	Warehouse/Distribution	SC	13,500		1,400		18,804		1,390		1,400		20,194		21,594		5,394		N/A	6/18/2009	5-40 years
Emporia Partners	Office/Industrial/Distribution	KS	3,753		274		7,567		—		274		7,567		7,841		1,731		N/A	8/27/2010	5-40 years
ITT	Office	CA	4,600		2,877		4,222		17		2,877		4,239		7,116		1,444		N/A	9/23/2010	5-40 years
Quad/Graphics	Industrial/Office	CO	7,500		1,950		10,236		272		1,950		10,508		12,458		1,931		N/A	12/30/2010	5-40 years
AT&T	Office/ Data Center	WA	26,000		6,770		32,420		461		6,770		32,881		39,651		5,786		N/A	1/31/2012	5-40 years
Westinghouse	Engineering Facility	PA	22,000		2,650		29,096		—		2,650		29,096		31,746		4,022		N/A	3/22/2012	5-40 years
TransDigm	Assembly/Manufacturing	NJ	6,432		3,773		9,030		—		3,773		9,030		12,803		1,505		N/A	5/31/2012	5-40 years
Travelers	Office	CO	9,500		2,600		13,500		468		2,600		13,968		16,568		2,138		N/A	6/29/2012	5-40 years
Zeller	Manufacturing	IL	9,000		2,674		13,229		651		2,674		13,880		16,554		1,597		N/A	11/8/2012	5-40 years
Northrop	Office	OH	10,800		1,300		16,188		—		1,300		16,188		17,488		3,082		N/A	11/13/2012	5-40 years
Health Net	Office	CA	13,500		4,182		18,072		—		4,182		18,072		22,254		3,327		N/A	12/18/2012	5-40 years
Comcast	Office	CO	—		3,146		22,826		174		3,146		23,000		26,146		3,957		N/A	1/11/2013	5-40 years
Boeing	Office	WA	—		3,000		9,000		102		3,000		9,102		12,102		2,732		N/A	2/15/2013	5-40 years
Schlumberger	Office	TX	30,060		2,800		47,752		145		2,800		47,897		50,697		4,612		N/A	5/1/2013	5-40 years
UTC	Office	NC	23,760		1,330		37,858		—		1,330		37,858		39,188		3,987		N/A	5/3/2013	5-40 years
Avnet	Research & Development/Flex Facility	AZ	19,860		1,860		31,481		—		1,860		31,481		33,341		3,230		N/A	5/29/2013	5-40 years
Cigna	Office	AZ	—		8,600		48,102		—		8,600		48,102		56,702		4,922		N/A	6/20/2013	5-40 years
Nokia	Office	IL	—		7,697		21,843		—		7,697		21,843		29,540		1,828		N/A	8/13/2013	5-40 years
Verizon	Office	NJ	26,160		5,300		36,768		1,472		5,300		38,240		43,540		5,082		N/A	10/3/2013	5-40 years
Fox Head	Office	CA	—		3,672		23,230		—		3,672		23,230		26,902		1,792		N/A	10/29/2013	5-40 years
Coca-Cola Refreshments	Office	GA	—		5,000		50,227		40		5,000		50,267		55,267		5,483		N/A	11/5/2013	5-40 years

S-1

				Initial Cost to Company		Cost  Capitalized Subsequent to Acquisition	Gross Carrying Amount at December 31, 2015						Life on which depreciation in latest income statement is computed
Property	Property Type	ST	Encumbrances	Land	Building and Improve-ments	Building and Improve-ments	Land	Building and Improve-ments	Total	Accumulated Depreciation	Date of Construction	Date of Acquisition
General Electric	Office	GA	—	5,050	51,396	114	5,050	51,510	56,560	3,832	N/A	11/5/2013	5-40 years
Atlanta Wildwood	Office	GA	—	4,189	23,414	114	4,189	23,528	27,717	3,155	N/A	11/5/2013	5-40 years
Community Insurance	Office	OH	—	1,177	22,323	—	1,177	22,323	23,500	2,013	N/A	11/5/2013	5-40 years
Anthem	Office	OH	—	850	8,892	—	850	8,892	9,742	1,074	N/A	11/5/2013	5-40 years
JPMorgan Chase	Office	OH	—	5,500	39,000	—	5,500	39,000	44,500	3,386	N/A	11/5/2013	5-40 years
IBM	Office	OH	—	4,750	32,769	341	4,750	33,110	37,860	4,153	N/A	11/5/2013	5-40 years
Aetna	Office	TX	—	3,000	12,330	185	3,000	12,515	15,515	1,671	N/A	11/5/2013	5-40 years
CHRISTUS Health	Office	TX	—	1,950	46,922	37	1,950	46,959	48,909	4,738	N/A	11/5/2013	5-40 years
Roush Industries	Office	MI	—	875	11,375	534	875	11,909	12,784	2,326	N/A	11/5/2013	5-40 years
Wells Fargo	Office	WI	—	3,100	26,348	359	3,100	26,707	29,807	10,430	N/A	11/5/2013	5-40 years
Shire Pharmaceuticals	Office	PA	—	2,925	18,935	25	2,925	18,960	21,885	3,669	N/A	11/5/2013	5-40 years
United HealthCare	Office	MO	—	2,920	23,510	44	2,920	23,554	26,474	3,576	N/A	11/5/2013	5-40 years
Northpointe Corporate Center II	Office	WA	—	1,109	6,066	4,575	1,109	10,641	11,750	784	N/A	11/5/2013	5-40 years
Comcast (Northpointe Corporate Center I)	Office	WA	—	2,292	16,930	—	2,292	16,930	19,222	2,189	N/A	11/5/2013	5-40 years
Farmers	Office	KS	—	2,750	17,106	51	2,750	17,157	19,907	1,758	N/A	12/27/2013	5-40 years
Caterpillar	Industrial	IL	—	6,000	46,511	—	6,000	46,511	52,511	5,333	N/A	1/7/2014	5-40 years
DigitalGlobe	Office	CO	—	8,600	83,400	—	8,600	83,400	92,000	6,285	N/A	1/14/2014	5-40 years
Waste Management	Office	AZ	—	—	16,515	10	—	16,525	16,525	1,511	N/A	1/16/2014	5-40 years
BT Infonet	Office	CA	—	9,800	41,483	—	9,800	41,483	51,283	3,394	N/A	2/27/2014	5-40 years
Wyndham Worldwide	Office	NJ	—	6,200	91,153	—	6,200	91,153	97,353	4,860	N/A	4/23/2014	5-40 years
Ace Hardware	Office	IL	23,294	6,900	33,945	—	6,900	33,945	40,845	2,195	N/A	4/24/2014	5-40 years
Equifax I	Office	MO	—	1,850	12,709	—	1,850	12,709	14,559	1,119	N/A	5/20/2014	5-40 years
American Express	Office	AZ	—	15,000	45,893	—	15,000	45,893	60,893	5,262	N/A	5/22/2014	5-40 years
SoftBank	Office	CA	—	22,789	68,950	—	22,789	68,950	91,739	11,744	N/A	5/28/2014	5-40 years
Vanguard	Office	NC	—	2,230	31,062	—	2,230	31,062	33,292	1,984	N/A	6/19/2014	5-40 years

S-2

						Initial Cost to Company				Cost  Capitalized Subsequent to Acquisition		Gross Carrying Amount at December 31, 2015										Life on which depreciation in latest income statement is computed
Property	Property Type	ST	Encumbrances			Land		Building and Improve-ments		Building and Improve-ments		Land		Building and Improve-ments		Total		Accumulated Depreciation		Date of Construction	Date of Acquisition
Parallon	Office	FL	—			1,000		16,772		—		1,000		16,772		17,772		1,054		N/A	6/25/2014	5-40 years
TW Telecom	Office	CO	21,213			11,097		35,817		583		11,097		36,400		47,497		2,329		N/A	8/1/2014	5-40 years
Equifax II	Office	MO	—			2,200		12,755		—		2,200		12,755		14,955		775		N/A	10/1/2014	5-40 years
Mason I	Office	OH	—			4,777		18,489		—		4,777		18,489		23,266		532		N/A	11/7/2014	5-40 years
Wells Fargo	Office	NC	—			2,150		40,806		—		2,150		40,806		42,956		1,683		N/A	12/15/2014	5-40 years
GE Aviation	Office	OH	—			4,400		61,681		—		4,400		61,681		66,081		2,730		N/A	2/19/2015	5-40 years
Westgate III	Office	TX	—			3,209		75,937		—		3,209		75,937		79,146		2,112		N/A	4/1/2015	5-40 years
Lisle	Office	IL	—			2,788		16,200		33		2,788		16,233		19,021		626		N/A	6/10/2015	5-40 years
Bloomingdale	Office	IL	—			1,178		5,182		—		1,178		5,182		6,360		145		N/A	6/10/2015	5-40 years
Columbia	Office	MD	—			6,989		46,875		—		6,989		46,875		53,864		1,166		N/A	6/10/2015	5-40 years
Denver	Office	CO	—			9,948		23,888		—		9,948		23,888		33,836		682		N/A	6/10/2015	5-40 years
Columbus	Office	OH	—			2,943		22,651		—		2,943		22,651		25,594		833		N/A	6/10/2015	5-40 years
Miramar	Office	FL	—			4,488		19,979		—		4,488		19,979		24,467		643		N/A	6/10/2015	5-40 years
Irving Carpenter	Office	TX	—			1,842		22,052		1,995		1,842		24,047		25,889		294		N/A	6/10/2015	5-40 years
Frisco	Office	TX	—			8,239		51,395		1,104		8,239		52,499		60,738		1,300		N/A	6/10/2015	5-40 years
Houston Westway II	Office	TX	—			3,961		78,668		—		3,961		78,668		82,629		2,363		N/A	6/10/2015	5-40 years
Houston Westway I	Office	TX	—			6,540		30,703		—		6,540		30,703		37,243		1,068		N/A	6/10/2015	5-40 years
Atlanta Perimeter	Office	GA	—			8,607		96,718		278		8,607		96,996		105,603		3,394		N/A	6/10/2015	5-40 years
Herndon	Office	VA	—			9,666		74,098		—		9,666		74,098		83,764		1,987		N/A	6/10/2015	5-40 years
Deerfield	Office	IL	—			4,339		37,298		—		4,339		37,298		41,637		1,164		N/A	6/10/2015	5-40 years
DreamWorks	Office	CA	—			26,387		190,805		—		26,387		190,805		217,192		2,640		N/A	7/21/2015	5-40 years
Highway 94	Office	MO	18,968			5,540		28,230		—		5,540		28,230		33,770		202		N/A	11/6/2015	5-40 years
DynCorp	Office	TX	11,162			1,952		15,540		—		1,952		15,540		17,492		57		N/A	12/11/2015	5-40 years
Mercedes-Benz	Office	TX	18,945			2,330		26,376		—		2,330		26,376		28,706		94		N/A	12/11/2015	5-40 years
Samsonite	Office	FL	24,561			5,040		42,490		—		5,040		42,490		47,530		88		N/A	12/11/2015	5-40 years
Total Operating Properties			$	363,863		$	339,980	$	2,449,128	$	17,791	$	339,980	$	2,466,919	$	2,806,899	$	200,734
Restoration Hardware	Industrial	CA	—			15,463		—		75,712		15,463		75,712		91,175		1,314		8/15/2015	6/20/2014	5-40 years
Total All Properties			$	363,863	(1)	$	355,443	$	2,449,128	$	93,503	$	355,443	$	2,542,631	$	2,898,074	$	202,048

S-3

(1) Amount does not include the net loan valuation premium of $0.8 millionrelated to the debt assumed in the TransDigm, Ace Hardware, Highway 94, and Samsonite property acquisitions, the Term Loan (July 2015) of $640.0 million, and the Revolver Loan (July 2015) of approximately $481.7 million.

	Activity for the years ended December 31,
	2015			2014			2013
Real estate facilities
Balance at beginning of year	$	1,823,895		$	1,175,423		$	328,342
Acquisitions	1,087,153			712,036			854,218
Improvements	7,381			2,826			256
Construction-in-progress	45,067			35,831			7
Real estate assets held for sale	—			(91,074		)	(7,400		)
Write off of tenant origination and absorption costs	—			(4,762		)	—
Sale of real estate assets	(65,422		)	(6,385		)	—
Balance at end of year	$	2,898,074		$	1,823,895		$	1,175,423
Accumulated depreciation
Balance at beginning of year	$	102,883		$	42,806		$	18,898
Depreciation expense	112,748			72,907			24,191
Less: Non-real estate assets depreciation expense	(328		)	(170		)	—
Less: Real estate assets held for sale depreciation expense	(2,265		)	(7,520		)	(283		)
Less: Write off of tenant origination and absorption costs amortization expense	—			(4,762		)	—
Less: Sale of real estate assets depreciation expense	(10,990		)	(378		)	—
Balance at end of year	$	202,048		$	102,883		$	42,806
Real estate facilities, net	$	2,696,026		$	1,721,012		$	1,132,617

S-4

EX-23.1

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the Registration Statement (Form S-3 No. 333-207075) of Griffin Capital Essential Asset REIT, Inc. and in the related Prospectus of our report dated March 10, 2016, with respect to the consolidated financial statements and schedule of Griffin Capital Essential Asset REIT, Inc. included in this Annual Report (Form 10-K) for the year ended December 31, 2015.

/s/ Ernst & Young, LLP

Los Angeles, California

March 10, 2016

EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Kevin A. Shields, certify that:

1. I have reviewed this Annual Report on Form 10-K of Griffin Capital Essential Asset REIT, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated:	March 10, 2016	By:	/s/ Kevin A. Shields
			Kevin A. Shields Chief Executive Officer and Chairman (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Joseph E. Miller, certify that:

1. I have reviewed this Annual Report on Form 10-K of Griffin Capital Essential Asset REIT, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated:	March 10, 2016	By:	/s/ Joseph E. Miller
			Joseph E. Miller Chief Financial Officer and Treasurer (Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

I, Kevin A. Shields, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

(i) The Annual Report on Form 10-K of Griffin Capital Essential Asset REIT, Inc. (the “Company”) for the annual period ended December 31, 2015 (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and

(ii) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated:	March 10, 2016	By:	/s/ Kevin A. Shields
			Kevin A. Shields Chief Executive Officer and Chairman (Principal Executive Officer)

EX-32.2

Exhibit 32.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

I, Joseph E. Miller, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

(i) The Annual Report on Form 10-K of Griffin Capital Essential Asset REIT, Inc. (the “Company”) for the annual period ended December 31, 2015 (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and

(ii) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated:	March 10, 2016	By:	/s/ Joseph E. Miller
			Joseph E. Miller Chief Financial Officer and Treasurer (Principal Financial Officer)

XML

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2015	Mar. 04, 2016	Jun. 30, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	Griffin Capital Essential Asset REIT, Inc.
Entity Central Index Key	0001456016
Document Type	10-K
Document Period End Date	Dec. 31, 2015
Amendment Flag	false
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	FY
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Well-known Seasoned Issuer	No
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Common Stock, Shares Outstanding		175,381,269
Entity Public Float			$ 1,806,641,574

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
ASSETS
Cash and cash equivalents	$ 21,944	$ 68,915
Restricted cash	24,187	40,752
Restricted cash - real estate funds held for exchange	47,031	10,105
Real estate:
Land	355,443	250,078
Building and improvements	2,020,947	1,178,751
Tenant origination and absorption cost	516,879	359,416
Construction in progress	4,805	35,650
Total real estate	2,898,074	1,823,895
Less: accumulated depreciation and amortization	(202,048)	(102,883)
Total real estate, net	2,696,026	1,721,012
Real estate assets and other assets held for sale, net	68,792	96,862
Investments in unconsolidated entities	56,863	66,249
Intangible assets, net	36,769	23,621
Deferred rent	26,432	15,619
Deferred financing costs, net	12,899	11,791
Mortgage receivable from affiliate	24,513	0
Other assets, net	34,833	10,521
Total assets	3,050,289	2,065,447
Debt:
Mortgage payable, plus unamortized premium of $810 and $1,858, respectively	364,673	325,696
Unsecured term loan (May 2014)	0	300,000
Term Loan (July 2015)	640,000	0
Revolver Loan (July 2015)	481,653	0
Total debt	1,486,326	625,696
Restricted reserves	11,286	37,050
Interest rate swap liability	6,394	0
Mandatory redemption of noncontrolling interest	18,129	0
Accounts payable and other liabilities	68,168	41,518
Distributions payable	6,147	5,083
Due to affiliates	8,757	1,851
Below market leases, net	41,706	40,394
Liabilities of real estate assets held for sale	2,845	3,906
Total liabilities	$ 1,649,758	$ 755,498
Commitments and contingencies
Preferred units subject to redemption, nil and 24,319,066 units outstanding as of December 31, 2015 and 2014, respectively	$ 0	$ 250,000
Noncontrolling interests subject to redemption, 531,000 units eligible towards redemption as of December 31, 2015 and 2014	4,887	12,543
Common stock subject to redemption	86,557	56,421
Stockholders' Equity:
Preferred stock, $0.001 par value; 200,000,000 shares authorized; no shares outstanding, as of December 31, 2015 and 2014	0	0
Common stock, $0.001 par value; 700,000,000 shares authorized; 175,184,519 and 129,763,016 shares outstanding, as of December 31, 2015 and 2014, respectively	175	1,326
Additional paid-in capital	1,561,499	1,128,318
Cumulative distributions	(212,031)	(104,429)
Accumulated deficit	(55,035)	(51,285)
Accumulated other comprehensive loss	(6,839)	(423)
Total stockholders’ equity	1,287,769	973,507
Noncontrolling interests	21,318	17,478
Total equity	1,309,087	990,985
Total liabilities and equity	$ 3,050,289	$ 2,065,447

XML

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Statement of Financial Position [Abstract]
Mortgage payable, unamortized Premium	$ 810	$ 1,858
Preferred Stock, units eligible towards redemption (in shares)	0	24,319,066
Noncontrolling interest, units eligible towards redemption (in shares)	531,000	531,000
Preferred Stock, par value (in usd per share)	$ 0.001	$ 0.001
Preferred Stock, number of shares authorized (in shares)	200,000,000	200,000,000
Preferred Stock, number of shares outstanding (in shares)		0
Common Stock, par value (in usd per share)	$ 0.001	$ 0.001
Common stock, number of shares authorized (in shares)	700,000,000	700,000,000
Common stock, number of shares outstanding (in shares)	175,184,519	129,763,016

XML

Consolidated Statements of Operations - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Revenue:
Rental income	$ 235,148	$ 164,412	$ 54,605
Property expense recoveries	54,947	37,982	14,311
Total revenue	290,095	202,394	68,916
Expenses:
Asset management fees to affiliates	19,389	12,541	4,317
Property management fees to affiliates	7,622	5,445	1,839
Property operating expense	37,924	30,565	8,865
Property tax expense	34,733	24,873	8,061
Acquisition fees and expenses to non- affiliates	2,730	4,261	4,639
Acquisition fees and expenses to affiliates	32,245	24,319	24,849
General and administrative expenses	7,595	4,982	2,758
Depreciation and amortization	112,748	72,907	24,191
Total expenses	254,986	179,893	79,519
Income (loss) from operations	35,109	22,501	(10,603)
Other income (expense):
Interest expense	(33,402)	(24,598)	(13,922)
Interest income	1,576	365	2
Gain from investment in unconsolidated entities	0	0	160
Loss from investment in unconsolidated entities	(1,475)	(1,358)	(106)
Gain from sale of depreciable operating property	13,813	3,104	0
Net income (loss)	15,621	14	(24,469)
Distributions to redeemable preferred unit holders	(9,245)	(19,011)	(2,969)
Preferred units redemption premium	(9,905)	0	0
Less: Net loss attributable to noncontrolling interests	138	698	3,092
Net loss attributable to controlling interests	(3,391)	(18,299)	(24,346)
Distributions to redeemable noncontrolling interests attributable to common stockholders	(359)	(355)	(318)
Net loss attributable to common stockholders	$ (3,750)	$ (18,654)	$ (24,664)
Net loss attributable to common stockholders per share, basic and diluted (in USD per share)	$ (0.02)	$ (0.17)	$ (0.97)
Weighted average number of common shares outstanding, basic and diluted (in shares)	155,059,231	112,358,422	25,404,780

XML

Consolidated Statements of Other Comprehensive Loss - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 15,621	$ 14	$ (24,469)
Other comprehensive loss:
Equity in other comprehensive loss of unconsolidated joint venture	(189)	(423)	0
Change in fair value of swap agreement	(6,371)	0	0
Total comprehensive income (loss)	9,061	(409)	(24,469)
Distributions to redeemable preferred unit holders	(9,245)	(19,011)	(2,969)
Preferred units redemption premium	(9,905)	0	0
Distributions to redeemable noncontrolling interests attributable to common stockholders	(359)	(355)	(318)
Less: other comprehensive loss attributable to noncontrolling interests	282	698	3,092
Net other comprehensive loss attributable to common stockholders	$ (10,166)	$ (19,077)	$ (24,664)

XML

Consolidated Statements of Equity - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Cumulative Distributions	Accumulated Deficit	Accumulated Other Comprehensive Loss	Total Stockholders' Equity	Non-controlling Interests
BALANCE at Dec. 31, 2012	$ 113,281	$ 134	$ 112,794	$ (9,192)	$ (7,967)	$ 0	$ 95,769	$ 17,512
BALANCE (in shares) at Dec. 31, 2012		13,376,868
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Gross proceeds from issuance of common stock	365,650	$ 366	365,285				365,650
Gross proceeds from issuance of common stock (in shares)		35,666,880
Discount on issuance of common stock	(910)		(910)				(910)
Offering costs including dealer manager fees to affiliates	(37,761)		(37,761)				(37,761)
Distributions to common stockholders	(8,589)			(8,589)			(8,589)
Issuance of shares for distribution reinvestment plan	8,902	$ 9	8,893	(8,902)
Issuance of shares for distribution reinvestment plan (in shares)		912,214
Repurchase of common stock	(614)	$ (1)	(614)				(614)
Repurchase of common stock (in shares)		(62,460)
Additions to common stock subject to redemption	(8,902)		(8,902)				(8,902)
Contribution of noncontrolling interest	8,334		239				239	8,095
Distributions to noncontrolling interests	(2,730)							(2,730)
Distributions to noncontrolling interests subject to redemption	(49)							(49)
Offering costs on preferred equity	(5,380)		(5,380)				(5,380)
Net loss	(27,756)				(24,664)		(24,664)	(3,092)
Other comprehensive loss								0
BALANCE at Dec. 31, 2013	394,574	$ 508	433,644	(26,683)	(32,631)	0	374,838	19,736
BALANCE (in shares) at Dec. 31, 2013		49,893,502
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Gross proceeds from issuance of common stock	776,607	$ 776	775,831				776,607
Gross proceeds from issuance of common stock (in shares)		75,545,500
Discount on issuance of common stock	(1,885)		(1,885)				(1,885)
Offering costs including dealer manager fees to affiliates	(76,638)		(76,638)				(76,638)
Distributions to common stockholders	(32,799)			(32,799)			(32,799)
Issuance of shares for distribution reinvestment plan	44,947	$ 45	44,902	(44,947)
Issuance of shares for distribution reinvestment plan (in shares)		4,572,953
Repurchase of common stock	(2,560)	$ (3)	(2,557)				(2,560)
Repurchase of common stock (in shares)		(258,939)
Additions to common stock subject to redemption	(44,947)		(44,947)				(44,947)
Contribution of noncontrolling interest	1,364		(140)				(140)	1,504
Distributions to noncontrolling interests	(3,050)							(3,050)
Distributions to noncontrolling interests subject to redemption	(14)							(14)
Net loss	(19,775)				(18,654)	(423)	(19,077)	(698)
Stock-based compensation (in shares)		10,000
Stock-based compensation	108		108				108
Other comprehensive loss								0
BALANCE at Dec. 31, 2014	$ 990,985	$ 1,326	1,128,318	(104,429)	(51,285)	(423)	973,507	17,478
BALANCE (in shares) at Dec. 31, 2014	129,763,016	129,763,016
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Offering costs including dealer manager fees to affiliates	$ (62)		(62)				(62)
Distributions to common stockholders	(55,045)			(55,045)			(55,045)
Issuance of shares for distribution reinvestment plan	52,557	$ 28	52,529	(52,557)
Issuance of shares for distribution reinvestment plan (in shares)		5,053,669
Repurchase of common stock	(13,819)	$ (4)	(13,815)				(13,819)
Repurchase of common stock (in shares)		(1,397,801)
Additions to common stock subject to redemption	(35,232)		(35,232)				(35,232)
Contribution of noncontrolling interest	7,282		0				0	7,282
Distributions to noncontrolling interests	(3,150)							(3,150)
Distributions to noncontrolling interests subject to redemption	(10)							(10)
Net loss	(3,888)				(3,750)		(3,750)	(138)
Stock-based compensation (in shares)		667
Stock-based compensation	12		12				12
Issuance of shares pursuant to Signature Office REIT merger	433,667	$ 42	433,625				433,667
Issuance of shares pursuant to Signature Office REIT merger (in shares)		41,764,968
Adjustment to par value - common stock		$ (1,217)	1,217
Adjustments to redemption value of redeemable noncontrolling interests	(10,473)		(10,473)				(10,473)
Write-off of offering costs on redemption of preferred units	5,380		5,380				5,380
Other comprehensive loss	(6,560)					(6,416)	(6,416)	(144)
BALANCE at Dec. 31, 2015	$ 1,309,087	$ 175	$ 1,561,499	$ (212,031)	$ (55,035)	$ (6,839)	$ 1,287,769	$ 21,318
BALANCE (in shares) at Dec. 31, 2015	175,184,519	175,184,519

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands		3 Months Ended								12 Months Ended			20 Months Ended
	Jun. 10, 2015	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014
Operating Activities:
Net income (loss)		$ 12,170	$ 4,005	$ (11,655)	$ 11,101	$ 4,883	$ 381	$ (7,990)	$ 2,740	$ 15,621	$ 14	$ (24,469)
Operating Activities:
Depreciation of building and building improvements										43,320	27,694	10,093
Amortization of leasing costs and intangibles, including ground leasehold interests										69,428	45,213	14,098
Amortization of above and below market leases, net										(3,785)	(468)	(546)
Amortization of deferred financing costs										3,764	3,853	1,943
Amortization of debt premium										(285)	(255)	(139)
Amortization of deferred revenue										(282)	0	0
Deferred rent										(13,792)	(11,563)	(3,515)
Termination fee revenue - release of tenant obligation										(2,078)	0	0
Termination fee revenue receivable from tenant, net										(2,904)	(5,937)	0
Gain from sale of depreciable operating property										(13,813)	(3,104)	0
Unrealized loss on interest rate swaps										23	0	0
Gain from investment in unconsolidated entities										0	0	(160)
Loss from investment in unconsolidated entities										1,475	1,358	106
Stock-based compensation										12	108	0
Change in operating assets and liabilities:
Other assets										(19,331)	3,490	(8,537)
Restricted cash										(8,811)	616	(3,597)
Accounts payable and other liabilities										19,978	13,414	13,077
Due to affiliates, net										3,918	(1,184)	2,594
Net cash provided by operating activities										92,458	73,249	948
Investing Activities:
Acquisition of properties, net										(401,418)	(661,618)	(840,691)
Cash assumed from the Signature Office REIT merger										8,557	0	0
Proceeds from disposition of properties										90,323	10,141	0
Real estate acquisition deposits										0	4,100	(3,350)
Real estate funds held for exchange										(36,926)	(10,105)	0
Reserves for tenant improvements										2,537	0	0
Improvements to real estate										(7,173)	(2,826)	(256)
Payments for construction in progress										(5,448)	(1,766)	(7)
Real estate development, net of unpaid construction costs										(48,314)	(21,691)	0
Mortgage receivable from affiliate										(24,231)	0	0
Land acquisition - real estate development										0	(7,529)	0
Investment in unconsolidated joint venture										0	(68,424)	(1,440)
Distributions of capital from investment in unconsolidated entities										7,722	1,815	72
Net cash used in investing activities										(414,371)	(757,903)	(845,672)
Financing Activities:
Proceeds from borrowings (Principal payoff of secured indebtedness)										0	151,000	198,000
Proceeds from borrowings - Mortgage debt										0	132,140	105,600
Proceeds from borrowings - KeyBank term loan										0	0	282,000
Proceeds from borrowings - Term Loan (July 2015)										640,000	0	0
Principal payoff of secured indebtedness - Keybank credit facility										0	(195,500)	(282,530)
Principal payoff of secured indebtedness - Keybank term loan										0	(282,000)	0
Principal payoff of secured indebtedness - LTI mortgage loan										(31,407)	0	0
Principal amortization payments on secured indebtedness										(2,283)	(1,707)	(1,396)
Deferred financing costs										(4,872)	(6,688)	(8,750)
Financing deposits										0	2,325	(2,325)
Issuance of common stock, net										0	774,722	364,740	$ 1,100,000
Issuance of preferred equity subject to redemption										0	0	250,000
Issuance of noncontrolling interests, net										0	1,364	0
Repurchase of common stock										(13,819)	(2,560)	(614)
Repurchase of preferred units										(254,525)	0	0
Distributions paid on preferred units subject to redemption										(10,859)	(19,011)	(1,354)
Distributions to noncontrolling interests										(3,477)	(3,410)	(3,041)
Distributions to common stockholders										(52,407)	(30,875)	(7,731)
Net cash provided by financing activities										274,942	743,162	849,458
Net (decrease) increase in cash and cash equivalents										(46,971)	58,508	4,734
Cash and cash equivalents at the beginning of the period					$ 68,915				$ 10,407	68,915	10,407	5,673
Cash and cash equivalents at the end of the period		21,944				68,915				21,944	68,915	10,407	68,915
Supplemental Disclosures of Cash Flow Information:
Cash paid for interest										27,518	19,718	11,255
Restricted cash - funded as a component of proceeds from borrowings										0	21,500	23,761
Supplemental Disclosures of Significant Non-cash Transactions:
Change in fair value of interest rate swap agreements										(6,560)	(423)	0
Construction in progress costs - real estate development										(38,208)	(35,114)	0
Unpaid construction in progress costs - real estate development										(10,106)	13,423	0
Limited partnership units of the operating partnership issued in conjunction with the acquisition of real estate assets										7,282	0	8,335
Mortgage debt assumed in conjunction with the acquisition of real estate assets plus a premium of $749 and $1,799, respectively										73,701	23,843	0
Debt discount/(premium)		749				$ 1,799				749	1,799	0	$ 1,799
Noncontrolling interest in land development										0	7,656	0
Increase in distributions payable to noncontrolling interests										42	9	56
Increase in distributions payable to common stockholders										2,637	1,924	859
(Decrease) increase in distributions payable to preferred unit holders										(1,615)	0	1,615
Distributions to redeemable noncontrolling interests attributable to common stockholders as reflected on the consolidated statements of operations										359	355	318
Common stock issued pursuant to the distribution reinvestment plan										52,557	44,947	8,902
Common stock redemptions funded subsequent to year-end										6,336	1,240	244
Unsecured Debt
Financing Activities:
Proceeds from borrowings - Unsecured term loan (May 2014)										0	300,000	0
Principal payoff of secured indebtedness - Unsecured term loan (May 2014)										(300,000)	0	0
Unsecured Revolver, May 2014
Financing Activities:
Proceeds from borrowings (Principal payoff of secured indebtedness)										490,100	0	0
Principal payoff of secured indebtedness - Unsecured Revolver										(490,100)	0	0
Revolver Loan, July 2015
Financing Activities:
Proceeds from borrowings (Principal payoff of secured indebtedness)										481,653	0	0
Revolving Credit Facility
Financing Activities:
Principal payoff of secured indebtedness - Unsecured Revolver										(173,000)	0	0
SOR Merger
Supplemental Disclosures of Significant Non-cash Transactions:
Mortgage debt assumed in conjunction with the acquisition of real estate assets plus a premium of $749 and $1,799, respectively										173,000	0	0
Debt discount/(premium)		$ 0								0
Land										71,529	0	0
Building and improvements										436,350	0	0
Tenant origination and absorption cost										89,357	0	0
Above market leases										16,860	0	0
Other assets										2,148	0	0
Below market leases										6,996	0	0
Accounts payable and other liabilities										11,138	0	0
Equity consideration for SOR Merger	$ 433,667									433,667	0	0
Common Stock
Financing Activities:
Offering costs										(62)	(76,638)	(37,761)
Supplemental Disclosures of Significant Non-cash Transactions:
Common stock issued pursuant to the distribution reinvestment plan										28	45	9
Preferred Stock
Financing Activities:
Offering costs										$ 0	$ 0	$ (5,380)

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Organization

12 Months Ended

Dec. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization

Organization

Griffin Capital Essential Asset REIT, Inc., a Maryland corporation (the "Company"), was formed on August 28, 2008 under the Maryland General Corporation Law. The Company was organized primarily with the purpose of acquiring single tenant properties that are essential to the tenant’s business and used a substantial amount of the net proceeds from the Public Offerings (as defined below) to invest in these properties. The Company satisfied requisite financial and non-financial requirements and elected to be taxed as a REIT for each taxable year ended since December 31, 2010 and for each year thereafter. The Company’s year end is December 31.

Griffin Capital Corporation, a California corporation (the "Sponsor"), has sponsored the Company’s Public Offerings. The Company’s Sponsor began operations in 1995, and was incorporated in 1996, to engage principally in acquiring and developing office and industrial properties. Kevin A. Shields, the Company's Chief Executive Officer and Chairman of the Company's board of directors, controls the Sponsor as the trustee of the trust entity that is the sole shareholder of the Sponsor.

Griffin Capital Essential Asset Advisor, LLC, a Delaware limited liability company (the "Advisor"), was formed on August 27, 2008. Griffin Capital Asset Management Company, LLC ("GAMCO," formerly known as Griffin Capital REIT Holdings, LLC) is the sole member of the Advisor, and Griffin Capital, LLC ("GC") is the sole member of GAMCO. The Company has entered into an advisory agreement for the Public Offerings (as amended and restated, the "Advisory Agreement"), which states that the Advisor is responsible for managing the Company’s affairs on a day-to-day basis and identifying and making acquisitions and investments on behalf of the Company. The officers of the Advisor are also officers of the Sponsor. The Advisory Agreement has a one-year term, and it may be renewed for an unlimited number of successive one-year periods by the Company's board of directors.

On August 28, 2008, the Advisor purchased 100 shares of common stock for $1,000 and became the Company’s initial stockholder. On February 20, 2009, the Company began to offer shares of common stock, pursuant to a private placement offering to accredited investors (collectively, the "Private Offering"), which included shares for sale pursuant to the distribution reinvestment plan ("DRP"). On November 6, 2009, the Company's registration statement was declared effective by the Securities and Exchange Commission ("SEC"), and the Company began to offer, in a public offering, a maximum of 82,500,000 shares of common stock, consisting of 75,000,000 shares at $10.00 per share (the "Primary Public Offering") and 7,500,000 shares pursuant to the DRP at $9.50 per share (together with the Primary Public Offering, the "Initial Public Offering") and terminated the Private Offering.

On April 25, 2013, the Company terminated its Initial Public Offering, having issued approximately 19,200,570 total shares of the Company's common stock for gross proceeds of approximately $191.5 million, including 585,533 shares, or $5.6 million, issued pursuant to the DRP. On April 26, 2013, the Company began to offer, in a follow-on offering, up to $1.0 billion in shares of common stock, consisting of approximately 97,200,000 shares at $10.28 per share in the primary offering (the "Primary Follow-On Offering" and together with the Primary Public Offering, the "Primary Public Offerings") and $100.0 million in shares of common stock, consisting of approximately 10,200,000 shares pursuant to the DRP at a price equal to 95% of the share price, which was approximately $9.77 per share (together with the Primary Follow-On Offering, the “Follow-On Offering” and, collectively with the Initial Public Offering, the "Public Offerings"). On April 22, 2014, the Company announced that it was no longer accepting subscriptions in the Follow-On Offering, as it expected to reach the maximum amount of offering proceeds. The Company issued 107,144,337 total shares of the Company's common stock for gross proceeds of approximately $1.1 billion in the Follow-On Offering, including 1,774,208 shares, or $17.3 million, issued pursuant to the DRP.

On May 7, 2014, the Company filed a Registration Statement on Form S-3 with the SEC for the registration of $75.0 million in shares for sale pursuant to the DRP (the "2014 DRP Offering"). On September 22, 2015, the Company filed a Registration Statement on Form S-3 with the SEC for the registration of $100.0 million in shares for sale pursuant to the DRP (the "2015 DRP Offering" and together with the 2014 DRP Offering, the "DRP Offerings") and terminated the 2014 DRP Offering. In connection with the DRP Offerings, the Company had issued 8,579,699 shares of the Company's common stock for gross proceeds of approximately $87.3 million through December 31, 2015. The 2015 DRP Offering may be terminated at any time upon 10 days’ prior written notice to stockholders.

On November 21, 2014, the Company entered into a merger agreement with Signature Office REIT, Inc. ("SOR"). In connection with the merger (the "SOR Merger"), (1) SOR merged into a wholly-owned subsidiary of the Company, and (2) each share of common stock of SOR issued and outstanding was converted into 2.04 shares ("Merger Consideration") of the Company's common stock. On June 10, 2015, the Company issued approximately 41.8 million shares of common stock upon the consummation of the SOR Merger. The assets and liabilities of SOR are included in the Company's consolidated financial statements as of the closing date, June 10, 2015. See Note 3, Real Estate, for further discussion.

On October 22, 2015, the Company's board of directors (the "Board"), at the recommendation of the Nominating and Corporate Governance Committee of the Board (the "Nominating and Corporate Governance Committee") comprised solely of independent directors, approved an estimated value per share of the Company's common stock of $10.40 (unaudited) based on the estimated value of the Company's assets less the estimated value of the Company's liabilities, or net asset value, divided by the number of shares outstanding on a fully diluted basis (the "NAV"), calculated as of September 30, 2015. The Company is providing this estimated value per share to assist broker dealers in connection with their obligations under applicable Financial Industry Regulatory Authority rules with respect to customer account statements. This valuation was performed in accordance with the provisions of Practice Guideline 2013-01, Valuations of Publicly Registered Non-Listed REITs, issued by the Investment Program Association ("IPA") in April 2013, in addition to guidance from the SEC.

As of December 31, 2015, the Company had received aggregate gross offering proceeds of approximately $1.4 billion from the sale of shares in the Private Offering, the Public Offerings, and the DRP Offerings. There were 175,184,519 shares outstanding at December 31, 2015, including shares issued pursuant to the DRP, less shares redeemed pursuant to the share redemption program. As of December 31, 2015 and 2014, the Company had issued $110.2 million and $57.7 million, respectively, in shares pursuant to the DRP, which are classified on the consolidated balance sheets as common stock subject to redemption. The common stock subject to redemptions is net of cumulative redemptions which includes stock tendered at December 31, 2015 of approximately $6.3 million and $1.2 million, respectively, which is included in accounts payable and other liabilities on the consolidated balance sheets. See Note 8, Equity — Share Redemption Program. Since inception and through December 31, 2015, the Company had redeemed 1,753,700 shares of common stock for approximately $17.3 million at a weighted average price per share of $9.88 pursuant to the share redemption program.

Griffin Capital Securities, LLC (formerly known as Griffin Capital Securities, Inc., the "Dealer Manager") is an affiliate of the Sponsor, and is a wholly-owned subsidiary of GC. The Dealer Manager was responsible for marketing the Company’s shares offered during the Public Offerings. The dealer manager agreement was terminated in accordance with its terms upon the termination of the Follow-On Offering.

Griffin Capital Essential Asset Operating Partnership, L.P., a Delaware limited partnership (the "Operating Partnership"), was formed on August 29, 2008. The Operating Partnership owns, directly or indirectly, all of the properties that the Company has acquired. The Advisor purchased an initial 99% limited partnership interest in the Operating Partnership for $200,000, and the Company contributed the initial $1,000 capital contribution, received from the Advisor, to the Operating Partnership in exchange for a 1% general partner interest. As of December 31, 2015, the Company owned approximately 97% of the limited partnership units of the Operating Partnership, and, as a result of the contribution of five properties to the Company, the Sponsor and certain of its affiliates, including the Company’s Chief Executive Officer and Chairman, Kevin A. Shields, and certain officers of the Company, owned approximately 1% of the limited partnership units of the Operating Partnership. The remaining approximately 2% of the limited partnership units were owned by third parties. No limited partnership units of the Operating Partnership have been redeemed during the years ended December 31, 2015 and 2014. The Operating Partnership may conduct certain activities through the Company’s taxable REIT subsidiary, Griffin Capital Essential Asset TRS, Inc., a Delaware corporation (the "TRS") formed on September 2, 2008, which is a wholly-owned subsidiary of the Operating Partnership. The TRS had no activity as of December 31, 2015.

The Company’s property manager is Griffin Capital Essential Asset Property Management, LLC, a Delaware limited liability company (the “Property Manager”), which was formed on August 28, 2008 to manage the Company’s properties. The Property Manager derives substantially all of its income from the property management services it performs for the Company.

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Basis of Presentation and Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2015

Accounting Policies [Abstract]

Basis of Presentation and Summary of Significant Accounting Policies

Basis of Presentation and Summary of Significant Accounting Policies

The accompanying consolidated financial statements of the Company are prepared by management on the accrual basis of accounting and in accordance with principles generally accepted in the United States (“GAAP”) as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (the “Codification” or “ASC”), and in conjunction with rules and regulations of the SEC. The consolidated financial statements include accounts and related adjustments, which are, in the opinion of management, of a normal recurring nature and necessary for a fair presentation of the Company's financial position, results of operations and cash flows for the years ended December 31, 2015 and 2014. The consolidated financial statements include accounts of the Company, the Operating Partnership, including a consolidated VIE (see Note 4, Investments), and the TRS. All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of the consolidated financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could materially differ from those estimates.

Change in Consolidated Financial Statements Presentation

Certain amounts in the Company's prior period consolidated financial statements have been reclassified to conform to the current period presentation. Based on certain criteria discussed below, the Company classified an office property as held for sale as of December 31, 2015. As a result, certain assets and liabilities are presented as held for sale on the consolidated balance sheets for all periods presented. See Assets Held for Sale in Note 3, Real Estate.

Cash and Cash Equivalents

The Company considers all short-term, highly liquid investments that are readily convertible to cash with a maturity of three months or less at the time of purchase to be cash equivalents. Cash equivalents may include cash and short-term investments. Short-term investments are stated at cost, which approximates fair value. There were no restrictions on the use of the Company’s operating cash balance as of December 31, 2015 and 2014.

The Company maintains cash accounts with major financial institutions. The cash balances consist of business checking accounts and money market accounts. These accounts are insured by the Federal Deposit Insurance Corporation up to $250,000 at each institution. At times, the balances in these accounts may exceed the insured amounts. The Company considers balances in excess of the insured amounts to potentially be a concentration of credit risk. However, the Company has not experienced any losses with respect to cash balances in excess of government-provided insurance and does not anticipate any losses in the future.

Restricted Cash

In conjunction with the contribution of certain assets, as required by certain lease provisions or certain lenders in conjunction with an acquisition or debt financing, or credits received by the seller of certain assets, the Company assumed or funded reserves for specific property improvements and deferred maintenance, rent abatement, re-leasing costs, and taxes and insurance (see Note 3, Real Estate). As ofDecember 31, 2015and2014, the balance of these reserves, included in the consolidated balance sheets as restricted cash, was approximately $24.2 million and$40.8 million, respectively.The balance as of December 31, 2015 includes $2.0 million in rent collections from the eight properties, which serve as collateral under the Midland Mortgage loan and the DynCorp property, which was acquired in the current period, $13.3 million designated for deferred maintenance and re-leasing costs, $2.2 million of taxes and insurance reserves to be applied to future amounts incurred, and $6.6 million in rent received from the DreamWorks property, which is to be held in escrow pending the wind down of a tax-deferred real estate exchange, as permitted by Section 1031 of the Internal Revenue Code, with the sale of the Will Partners and LTI properties. Such exchange was completed on January 12, 2016, thus, releasing any restrictions on the DreamWorks rent receipts.

The proceeds of approximately $47.0 million from the sale of the Will Partners and LTI properties were deposited with a qualified intermediary, as both properties were treated as a tax-deferred exchange. See Note 3, Real Estate.

Real Estate

Purchase Price Allocation

The Company applies the provisions in ASC 805-10, Business Combinations, to account for the acquisition of real estate, or real estate related assets, in which a lease, or other contract, is in place representing an active revenue stream, as a business combination. In accordance with the provisions of ASC 805-10, the Company recognizes the assets acquired, the liabilities assumed and any noncontrolling interest in the acquired entity at their fair values as of the acquisition date, on an “as if vacant” basis. Further, the Company recognizes the fair value of assets acquired, liabilities assumed and any noncontrolling interest in acquisitions of less than a100%interest when the acquisition constitutes a change in control of the acquired entity. The accounting provisions have also established that acquisition-related costs and restructuring costs are considered separate and not a component of a business combination and, therefore, are expensed as incurred. Acquisition-related costs for the years ended December 31, 2015, 2014, and 2013 totaled $35.0 million, $28.6 million, and $29.5 million, respectively. For properties acquired in a sale-leaseback transaction or part of a development project, acquisition fees and acquisition expenses are included as part of the acquisition price.

Acquired in-place leases are valued as above-market or below-market as of the date of acquisition. The valuation is measured based on the present value (using an interest rate, which reflects the risks associated with the leases acquired) of the difference between (a) the contractual amounts to be paid pursuant to the in-place leases and (b) management’s estimate of fair market lease rates for the corresponding in-place leases over a period equal to the remaining non-cancelable term of the lease for above-market leases, taking into consideration below-market extension options for below-market leases. In addition, renewal options are considered and will be included in the valuation of in-place leases if (1) it is likely that the tenant will exercise the option, and (2) the renewal rent is considered to be sufficiently below a fair market rental rate at the time of renewal. The above-market and below-market lease values are capitalized as intangible lease assets or liabilities and amortized as an adjustment to rental income over the remaining terms of the respective leases.

The aggregate fair value of in-place leases includes direct costs associated with obtaining a new tenant, opportunity costs associated with lost rentals, which are avoided by acquiring an in-place lease, and tenant relationships. Direct costs associated with obtaining a new tenant include commissions, tenant improvements, and other direct costs and are estimated using methods similar to those used in independent appraisals and management’s consideration of current market costs to execute a similar lease. These direct costs are considered intangible lease assets and are included with real estate assets on the consolidated balance sheets. The intangible lease assets are amortized to expense over the remaining terms of the respective leases. The value of opportunity costs is calculated using the contractual amounts to be paid, including real estate taxes, insurance, and other operating expenses, pursuant to the in-place leases over a market lease-up period for a similar lease. Customer relationships are valued based on management’s evaluation of certain characteristics of each tenant’s lease and the Company’s overall relationship with that respective tenant. Characteristics management will consider in allocating these values include the nature and extent of the Company’s existing business relationships with tenants, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals (including those existing under the terms of the lease agreement), among other factors. These intangibles will be included in intangible lease assets on the consolidated balance sheets and are amortized to expense over the remaining term of the respective leases.

The determination of the fair values of the assets and liabilities acquired requires the use of significant assumptions about current market rental rates, rental growth rates, discount rates and other variables.

Depreciation and Amortization

The purchase price of real estate acquired and costs related to development, construction, and property improvements are capitalized. Repairs and maintenance costs include all costs that do not extend the useful life of the real estate asset and are expensed as incurred. The Company considers the period of future benefit of an asset to determine the appropriate useful life. The Company anticipates the estimated useful lives of its assets by class to be generally as follows:

Buildings	25-40 years
Building Improvements	5-20 years
Land Improvements	15-25 years
Tenant Improvements	Shorter of estimated useful life or remaining contractual lease term
Tenant origination and absorption cost	Remaining contractual lease term
In-place lease valuation	Remaining contractual lease term with consideration as to below-market extension options for below-market leases

Depreciation expense for buildings and improvements for the years ended December 31, 2015, 2014, and 2013 was $43.3 million, $27.7 million, and $10.1 million, respectively. Amortization expense for intangibles, including but not limited to, tenant origination and absorption costs for the years ended December 31, 2015, 2014, and 2013 was $69.4 million, $45.2 million, and $14.1 million, respectively. See Note 3, Real Estate, for amortization related to in-place lease valuations.

Assets Held for Sale

The Company accounts for properties held for sale in accordance with ASC Topic 360, Property, Plant, and Equipment, ("ASC Topic 360"), which addresses financial accounting and reporting for the impairment or disposal of long-lived assets and Accounting Standards Update ("ASU") No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity ("ASU No. 2014-08"). Under ASU No. 2014-08, a discontinued operation is (i) a component of an entity or group of components that has been disposed of by sale, that has been disposed of other than by sale, or that is classified as held for sale that represents a strategic shift that has or will have a major effect on an entity's operations and financial results or (ii) an acquired business or nonprofit activity that is classified as held for sale on the date of the acquisition.

In accordance with ASC 205, a component of an entity or a group of components of an entity, or a business or nonprofit activity (the entity to be sold), shall be classified as held for sale in the period in which all of the required criteria are met.

In accordance with ASC Topic 360, upon being classified as held for sale, a property is carried at the lower of (i) its carrying amount or (ii) fair value less costs to sell. In addition, a property being held for sale ceases to be depreciated. As of December 31, 2015, one property owned by the Company met the criteria to be classified as held for sale and was included in continuing operations in the consolidated statements of operations based on the Company's early adoption of ASU No. 2014-08, as it did not meet the prerequisite requirements to be classified as discontinued operations. See Note 3, Real Estate.

Impairment of Real Estate and Related Intangible Assets

The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of real estate and related intangible assets may not be recoverable. When indicators of potential impairment are present that indicate that the carrying amounts of real estate and related intangible assets may not be recoverable, management assesses whether the carrying value of the assets will be recovered through the future undiscounted operating cash flows expected from the use of the assets and the eventual disposition. If, based on this analysis, the Company does not believe that it will be able to recover the carrying value of the asset, the Company will record an impairment charge to the extent the carrying value exceeds the net present value of the estimated future cash flows of the asset.

Projections of expected future undiscounted cash flows require management to estimate future market rental income amounts subsequent to the expiration of current lease agreements, property operating expenses, discount rates, the number of months it takes to re-lease the property and the number of years the property is held for investment. As of December 31, 2015 and 2014, the Company did not record any impairment charges related to its real estate assets or intangible assets.

Intangible Assets and Liabilities Arising from In-Place Leases Where the Company is the Lessee

In-place ground leases where the Company is the lessee may have value associated with effective contractual rental rates that are above or below market rates. Such values are calculated based on the present value (using a discount rate that reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place lease and (ii) management's estimate of fair market lease rates for the corresponding in-place lease, measured over a period equal to the remaining terms of the lease. The capitalized above-market and below-market in-place lease values are recorded as intangible lease liabilities and assets, respectively, and are amortized as an adjustment to property operating expense over the remaining term of the respective lease.

The Operating Partnership, through a single purpose entity, assumed a ground lease with the acquisition of the Waste Management property on January 16, 2014. The ground lease has a remaining term of 80 years, expiring on December 31, 2095. See Note 3, Real Estate.

Investments

ASC 810-10, Consolidation, provides a framework for identifying variable interest entities (“VIEs”) and determining when a company should include the assets, liabilities, noncontrolling interests, and results of activities of the VIE in its consolidated financial statements. In general, a VIE is an entity or other legal structure used to conduct activities or hold assets that either (1) has an insufficient amount of equity to carry out its principal activities without additional subordinated financial support, (2) has a group of equity owners that are unable to make significant decisions about its activities, or (3) has a group of equity owners that do not have the obligation to absorb losses or the right to receive returns generated by its operations. Generally, a VIE should be consolidated if a party with an ownership, contractual, or other financial interest in the VIE (a variable interest holder) has the power to direct the VIE’s most significant activities and the obligation to absorb losses or right to receive benefits of the VIE that could be significant to the VIE. A variable interest holder that consolidates the VIE is called the primary beneficiary. Upon consolidation, the primary beneficiary generally must record all of the VIE’s assets, liabilities, and noncontrolling interest at fair value and subsequently account for the VIE as if it were consolidated based on majority voting interest. If the variable interest holder is not the primary beneficiary, the interest in the VIE is recorded under the equity method of accounting. See Note 4, Investments.    

Revenue Recognition

Leases associated with the acquisition and contribution of certain real estate assets (see Note 3, Real Estate), have net minimum rent payment increases during the term of the lease and are recorded to rental revenue on a straight-line basis, commencing as of the contribution or acquisition date. If a lease provides for contingent rental income, the Company will defer the recognition of contingent rental income, such as percentage rents, until the specific target that triggers the contingent rental income is achieved.

During the years ended December 31, 2015, 2014, and 2013, the Company recognized deferred rent from tenants of $13.8 million, $11.6 million, and $3.5 million, respectively. As of December 31, 2015 and 2014, the cumulative deferred rent balance for assets not held for sale was $26.4 million and $15.6 million, respectively.

Tenant reimbursement revenue, which is comprised of additional amounts collected from tenants for the recovery of certain operating expenses, including repair and maintenance, property taxes and insurance, and capital expenditures, to the extent allowed pursuant to the lease (collectively "Recoverable Expenses"), is recognized as revenue when the additional rent is due. Recoverable Expenses to be reimbursed by a tenant are determined based on the Company's estimate of the property's operating expenses for the year, pro rated based on leased square footage of the property, and are collected in equal installments as additional rent from the tenant, pursuant to the terms of the lease. At the end of the calendar year, the Company reconciles the amount of additional rent paid by the tenant during the year to the actual amount of Recoverable Expenses incurred by the Company for the same period. The difference, if any, is either charged or credited to the tenant pursuant to the provisions of the lease. In certain instances, the lease may restrict the amount the Company can recover from the tenant such as a cap on certain or all property operating expenses. As of December 31, 2015, the Company estimated that approximately $2.3 million, net, was over collected from tenants throughout the year, and as a result, the Company recorded a liability to reflect the net over collections which will be refunded to the tenants either by a credit to contractual rent payments or as a disbursement from operating cash flow.

Organizational and Offering Costs

Organizational and offering costs of the Primary Public Offerings are paid either by the Company or the Sponsor, on behalf of the Advisor, for the Company, which were reimbursed from the proceeds of the Public Offerings at the estimated rate. Organizational and offering costs consist of all expenses (other than sales commissions and dealer manager fees) paid by the Company in connection with the Public Offerings, including legal, accounting, printing, mailing and filing fees, charges from the escrow holder and other accountable offering expenses, including, but not limited to, (i) amounts to reimburse the Advisor for all marketing-related costs and expenses, such as salaries and direct expenses of employees of the Advisor and its affiliates in connection with registering and marketing the Company’s shares; (ii) technology costs associated with the offering of the Company’s shares; (iii) costs of conducting training and education meetings; (iv) costs of attending seminars conducted by participating broker-dealers; and (v) payment or reimbursement of bona fide due diligence expenses.

Pursuant to the Advisory Agreement, the Company was obligated to reimburse the Advisor for organizational and offering expenses incurred in connection with the Primary Public Offerings in an amount not to exceed 3.5% of gross offering proceeds of the terminated or completed Primary Public Offerings for issuer costs (excluding sales commissions and dealer manager fees). In addition, pursuant to the Advisory Agreement, organization and offering expenses (including sales commissions and dealer manager fees and non-accountable due diligence expense allowance but excluding acquisition fees and expenses) were subject to a limitation of 15% of gross offering proceeds of the terminated or completed Public Offerings. If the organization and offering expenses exceeded such limits discussed above, within 60 days after the end of the month in which the Public Offerings terminated or were completed, the Advisor would have been obligated to reimburse the Company for any excess amounts. As long as the Company is subject to the Statement of Policy Regarding Real Estate Investment Trusts published by the North American Securities Administrators Association (“NASAA REIT Guidelines”), such limitations discussed above will also apply to any future public offerings. As of December 31, 2015, the Company was not obligated to reimburse the Advisor for any organizational and offering expenses. As of December 31, 2015, the Company incurred approximately $130.6 million of offering costs and approximately $0.8 million in organizational costs.

Deferred Financing Costs

Deferred financing costs represent commitment fees, loan fees, and other fees associated with obtaining financing. These costs are amortized to, and included as a component of, interest expense over the terms of the respective financing agreements. Amortization expense for the years ended December 31, 2015, 2014, and 2013 was $3.8 million, $3.9 million, and $1.9 million, respectively. Amortization expense for the year ended December 31, 2015 includes approximately $1.4 million of write-offs related to the Unsecured credit facility (May 2014), which was terminated upon the execution of the Unsecured Credit Facility (July 2015) on July 20, 2015. Similarly, the amortization expense for the year ended December 31, 2014 includes approximately $1.7 million of write-offs related to the refinancing through the AIG loan on January 24, 2014 and the Company's previously existing KeyBank credit facility and KeyBank term loan, which were both terminated in conjunction with the execution of the Unsecured credit facility (May 2014) on May 8, 2014. As of December 31, 2015 and 2014, the Company’s deferred financing costs, net of accumulated amortization, were $12.9 million and $11.8 million, respectively.

Other Assets

Other assets consist primarily of tenant and non-tenant receivables, prepaid expenses, and deferred leasing commissions and other leasing costs ("Deferred Leasing Costs"), net of amortization. Non-tenant receivables primarily consist of a $4.9 million and a $2.9 million termination fee, as a result of the lease terminations with World Kitchen, LLC, the former tenant at the Will Partners property, on January 24, 2014, and with Wells Fargo Bank, N.A., the former tenant at the Wells Fargo property, on December 31, 2015, respectively. Prepaid expenses, which are capitalized as other assets, will be expensed over the corresponding period. Leasing commissions for new, renewal, or expansion leases are amortized using the straight-line method over the term of the related lease. Amortization of Deferred Leasing Costs is included in depreciation and amortization in the Company's accompanying consolidated statements of operations. Deferred Leasing Costs, net of the Deferred Leasing Costs related to the real estate held for sale, totaled $13.2 million and $2.2 million as of December 31, 2015 and 2014, respectively.

Noncontrolling Interests

Due to the Company’s control through the general partner interest in the Operating Partnership and the limited rights of the limited partners, the Operating Partnership, including its wholly-owned subsidiaries, is consolidated with the Company and the limited partners’ interests are reflected as noncontrolling interests on the accompanying consolidated balance sheets.

The Company reports noncontrolling interests in subsidiaries within equity in the consolidated financial statements, but separate from total stockholders’ equity. Also, any acquisitions or dispositions of noncontrolling interests that do not result in a change of control are accounted for as equity transactions. Further, the Company recognizes a gain or loss in net income (loss) when a subsidiary is deconsolidated upon a change in control. Net income (loss) allocated to noncontrolling interests is shown as an adjustment to net income (loss) attributable to common stockholders. Any future purchase or sale of an interest in an entity that results in a change of control may have a material impact on the financial statements, as the interest in the entity will be recognized at fair value with gains and losses included in net income (loss).

If noncontrolling interests are determined to be redeemable, they are classified as temporary equity and reported at their redemption value as of the balance sheet date. Since redeemable noncontrolling interests are carried at the redemption amount, net income (loss) and distributions are not allocated to redeemable noncontrolling interests. Distributions to redeemable noncontrolling interest holders are allocated between common stockholders and noncontrolling interests based on their respective weighted-average ownership percentage of the Operating Partnership. See Note 8, Equity.

Share-Based Compensation

The Company has adopted an Employee and Director Long-Term Incentive Plan (the “Plan”) pursuant to which the Company may issue stock-based awards to its directors and full-time employees (should the Company ever have employees), executive officers and full-time employees of the Advisor and its affiliate entities that provide services to the Company, and certain consultants who provide significant services to the Company. The term of the Plan is 10 years and the total number of shares of common stock reserved for issuance under the Plan is 10% of the outstanding shares of stock at any time, not to exceed 10,000,000 shares in the aggregate. Awards granted under the Plan may consist of stock options, restricted stock, stock appreciation rights and other equity-based awards. The stock-based payment will be measured at fair value and recognized as compensation expense over the vesting period.

On March 3, 2014, the compensation committee of the board of directors authorized the issuance of 5,000 shares of restricted stock to each of the Company's independent directors. These restricted shares were immediately vested upon issuance. In addition, the compensation committee authorized the future issuance of 1,000 shares of restricted stock to each of the Company's independent directors for each 12-consecutive-month period during which each independent director continuously remains a director for the Company. The future shares granted will vest over a three year period, or will immediately vest upon a change in control of the Company. Upon re-election of each independent director at the June 12, 2014 annual stockholders' meeting, the Company measured and began recognizing director compensation expense for the 1,000 shares of restricted stock granted, subject to the vesting period. One-third of the shares of restricted stock, or 333 shares, for each of the Company's independent directors, vested during the year ended December 31, 2015. The fair value of both issuances was estimated at $10.28 per share, the then most recent price paid to acquire a share of the Company's common stock. All issuances of restricted stock are entitled to dividends upon vesting of the shares.

Upon re-election of each independent director at the June 16, 2015 annual stockholders' meeting, the Company granted 1,000 shares of restricted common stock to each of the independent directors. The fair value of such issuance was estimated at $10.40 per share, the then most recent price paid to acquire a share of the Company's common stock related to the 2014 DRP Offering. Immediately upon granting the restricted common shares, the Company measured and began recognizing director compensation expense, subject to the same vesting period discussed above.

Derivative Instruments and Hedging Activities

FASB ASC Topic 815: Derivatives and Hedging ("ASC 815"), provides the disclosure requirements for derivatives and hedging activities with the intent to provide users of financial statements with an enhanced understanding of: (a) how and why an entity uses derivative instruments, (b) how the entity accounts for derivative instruments and related hedged items, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. Further, qualitative disclosures are required that explain the Company’s objectives and strategies for using derivatives, as well as quantitative disclosures about the fair value of gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative instruments.

As required by ASC 815, the Company recorded all derivatives on the consolidated balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, and whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain risks, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. See Note 6, Interest Rate Contracts.

Fair Value Measurements

The fair value of financial and nonfinancial assets and liabilities is based on a fair value hierarchy established by the FASB that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described as follows:

• Level 1. Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets;

• Level 2. Inputs to the valuation methodology include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

• Level 3. Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

See Note 7, Fair Value Measurements.

Income Taxes

The Company elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”). To qualify as a REIT, the Company must meet certain organizational and operational requirements. The Company intends to adhere to these requirements and maintain its REIT status for the current year and subsequent years. As a REIT, the Company generally will not be subject to federal income taxes on taxable income that is distributed to stockholders. However, the Company may be subject to certain state and local taxes on its income and property, and federal income and excise taxes on its undistributed taxable income, if any. If the Company fails to qualify as a REIT in any taxable year, the Company will then be subject to federal income taxes on the taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year during which qualification is lost unless the IRS grants the Company relief under certain statutory provisions. Such an event could materially adversely affect net income and net cash available for distribution to stockholders. As of December 31, 2015, the Company satisfied the REIT requirements and distributed all of its taxable income.

Pursuant to the Code, the Company has elected to treat its corporate subsidiary as a taxable REIT subsidiary (“TRS”). In general, the TRS may perform non-customary services for the Company’s tenants and may engage in any real estate or non real estate-related business. The TRS will be subject to corporate federal and state income tax. As of December 31, 2015, the TRS had not commenced operations.

Per Share Data

The Company reports earnings per share for the period as (1) basic earnings per share computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding during the period, and (2) diluted earnings per share computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding, including common stock equivalents. As of December 31, 2015 and 2014, there were no common stock equivalents that would have a dilutive effect on earnings (loss) per share for common stockholders.

Distributions declared and paid per common share assume each share was issued and outstanding each day during the three months ended December 31, 2015. Distributions declared per common share were based on daily declaration and record dates selected by the Company’s board of directors of $0.001901096 per day per share on the outstanding shares of common stock.

Segment Information

ASC Topic 280, Segment Reporting, establishes standards for reporting financial and descriptive information about a public entity’s reportable segments. The Company internally evaluates all of the properties and interests therein as one reportable segment.

Unaudited Data

Any references to the number of buildings, square footage, number of leases, occupancy, and any amounts derived from these values in the notes to the consolidated financial statements are unaudited and outside the scope of the Company's independent registered public accounting firm's audit of its consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board.

Recently Issued Accounting Pronouncements

In February 2016, the FASB issued ASU 2016-02, Leases. ASU 2016-02 amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. ASU 2016-02 will be effective beginning in the first quarter of 2019. Early adoption of ASU 2016-02 as of its issuance is permitted. The new leases standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. The Company is currently evaluating the impact of adopting the new leases standard on the consolidated financial statements.

In September 2015, the FASB issued ASU No. 2015-16, Simplifying the Accounting for Measurement Period Adjustments (“ASU No. 2015-16”). In a business combination, ASU No. 2015-16 requires an acquirer to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The acquirer is required to disclose, by financial statement line item, the nature and amount for the adjustments and the current period income statement impact related to prior periods. The amendments in this ASU are effective for fiscal years beginning December 15, 2016 and interim periods beginning after December 15, 2017. Early adoption is permitted. The Company elected to adopt ASU No. 2015-16 early, beginning with the quarter ended September 30, 2015. There was no significant impact to the Company's consolidated financial statements or notes to theconsolidated financial statements as a result of early adoption.

In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30) (“ASU 2015-03”) to amend the accounting guidance for the presentation of debt issuance costs. The standard requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. ASU 2015-03 is effective for public business entities for fiscal years beginning after December 15, 2015 and retrospective application is required. Early adoption of the guidance is permitted. The Company does not expect the adoption of ASU No. 2015-03 to have a significant impact on its financial statements.

In February 2015, the FASB issued ASU No. 2015-02, Consolidation: Amendments to the Consolidation Analysis ("ASU No. 2015-02"), which amended the existing accounting standards for consolidation under both the variable interest model and the voting model. Under ASU No. 2015-02, companies will need to re-evaluate whether an entity meets the criteria to be considered a VIE, whether companies still meet the definition of primary beneficiaries, and whether an entity needs to be consolidated under the voting model. ASU No. 2015-02 may be applied using a modified retrospective approach or retrospectively, and is effective for reporting periods beginning after December 15, 2015. Early adoption is permitted. The Company does not expect the adoption of ASU No. 2015-02 to have a significant impact on its financial statements.

In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements (Subtopic 205-40), Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU No. 2014-15”). The amendments in ASU No. 2014-15 require management to evaluate, for each annual and interim reporting period, whether there are conditions or events, considered in the aggregate, that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or are available to be issued when applicable) and, if so, provide related disclosures. ASU No. 2014-15 is effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Early adoption is permitted for annual or interim reporting periods for which the financial statements have not previously been issued. The Company does not expect the adoption of ASU No. 2014-15 to have a significant impact on its financial statements.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU No. 2014-09”). ASU No. 2014-09 replaces substantially all industry-specific revenue recognition requirements and converges areas under this topic with International Financial Reporting Standards. ASU No. 2014-09 implements a five-step process for customer contract revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards. ASU No. 2014-09 also requires enhanced disclosures regarding the nature, amount, timing, and uncertainty of revenues and cash flows from contracts with customers. Other major provisions in ASU No. 2014-09 include capitalizing and amortizing certain contract costs, ensuring the time value of money is considered in the applicable transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. ASU No. 2014-09 was originally effective for reporting periods beginning after December 31, 2016 (for public entities). On April 1, 2015, the FASB voted to defer the effective date of ASU No. 2014-09 by one year, to annual reporting periods beginning after December 15, 2017. On July 9, 2015, the FASB affirmed its proposal to defer the effective date to annual reporting periods beginning after December 15, 2017, although entities may elect to adopt the standard as of the original effective date. The Company is currently evaluating the potential impact of the pending adoption of this new guidance on its consolidated financial statements.

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Real Estate

12 Months Ended

Dec. 31, 2015

Real Estate [Abstract]

Real Estate

Real Estate

As of December 31, 2015, the Company’s real estate portfolio consisted of 74 properties in 20 states consisting substantially of office, warehouse, and manufacturing facilities with a combined acquisition value of approximately $3.0 billion, including the allocation of the purchase price to above and below-market lease valuation.

2015 Acquisitions and SOR Merger

During the year ended December 31, 2015, the Company acquired six properties from unaffiliated parties and one property from an affiliated party. The aggregate purchase price of the acquisitions was approximately $483.6 million.

As previously discussed in Note 1, the SOR Merger closed on June 10, 2015, and as part of the SOR Merger, the Company assumed 15 buildings located on 13 properties in 8 states, comprising a total of approximately 2.6 million square feet. The properties assumed through the SOR Merger have been allocated a combined value of $607.1 million.

A summary of the fair value of the assets and liabilities acquired and assumed through the SOR Merger in exchange for approximately 41.8 million shares of the Company's stock is shown in the table below:

Cash assumed	$	8,557
Land	71,529
Building and improvements	436,350
Tenant origination and absorption cost	89,357
Above market leases	16,860
Other assets	2,148
Total assets	$	624,801
Unsecured debt (1)	$	173,000
Below market leases	6,996
Accounts payable and other liabilities	11,138
Total liabilities	191,134
Equity consideration for SOR Merger	433,667
Total liabilities and equity	$	624,801

(1) The unsecured debt was terminated simultaneously with the closing of the SOR Merger, and repaid with borrowings from the Company's Unsecured credit facility (May 2014).

Highway 94

On November 6, 2015, the Company, through a wholly-owned subsidiary of the Operating Partnership, acquired the interests of Griffin Capital (Highway 94) Investors, DST ("Highway 94") from 45 unaffiliated third party investors. The Highway 94 property is a 660,000 square foot manufacturing facility located in Jefferson City, Missouri, and was managed by an affiliate of the Advisor. The Highway 94 property is leased in its entirety to ABB, Inc., which lease terminates on August 31, 2024. ABB, Inc. has the option to purchase the Highway 94 property through the termination date of the lease. The unaffiliated third party investors contributed all of their ownership interests in Highway 94 in exchange for either limited partnership units in the Operating Partnership or cash. The purchase price of the Highway 94 property was $31.9 million. The Company, through the Operating Partnership, issued approximately $7.3 million in limited partnership units to those investors who elected to exchange their ownership interest. The issuance of the limited partnership units is included as a component of noncontrolling interest in the Company's permanent equity. The remaining balance of approximately $24.6 million consists of a mortgage loan assumption of approximately $19.0 million and a cash payment made to the unaffiliated third party investors of $5.6 million.

The aggregate value of the 21 properties related to the 2015 acquisitions, SOR Merger, and completion of the Restoration Hardware project, which was transferred out of construction in progress in August 2015, was approximately $1.2 billion as shown below:

Property	Location	Tenant/Major Lessee	Acquisition/ Merger Date	Purchase Price			Approx. Square Feet	Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)			Unsecured Credit Facility		Other Debt Financings			Year of Lease Expiration (for Major Lessee)
GE Aviation	West Chester, OH	General Electric Company	2/19/2015	$	66,000		409,800	$	1,980		$	50,000	$	—		2020
Westgate III	Houston, TX	Wood Group Mustang, Inc.	4/1/2015	77,000			225,500	2,310			76,100		—			2026
Lisle	Lisle, IL	McCain Foods USA, Inc.	6/10/2015	19,500		(2)	94,400	(2)			(3)		—			2021
Bloomingdale	Bloomingdale, IL	BFS Retail & Commercial Operations, LLC	6/10/2015	7,450		(2)	71,100	(2)			(3)		—			2018
Columbia	Columbia, MD	Leidos Holdings, Inc.	6/10/2015	58,130		(2)	200,600	(2)			(3)		—			2019
Denver	Denver, CO	Jackson National Life Insurance Company	6/10/2015	35,000		(2)	182,900	(2)			(3)		—			2027
Columbus	Dublin, OH	Qwest Communications Company, LLC	6/10/2015	27,600		(2)	164,600	(2)			(3)		—			2022
Miramar	Miramar, FL	Humana Medical Plan Inc.	6/10/2015	24,600		(2)	96,400	(2)			(3)		—			2023
Irving Carpenter	Irving, TX	NEC Corporation of America	6/10/2015	23,500		(2)	119,600	(2)			(3)		—			2026
Frisco	Frisco, TX	T-Mobile West Corporation	6/10/2015	59,250		(2)	284,200	(2)			(3)		—			2017
Houston Westway II	Houston, TX	VetcoGray, Inc. (GE Oil & Gas, Inc.)	6/10/2015	82,500		(2)	242,400	(2)			(3)		—			2022
Houston Westway I	Houston, TX	Cameron Solutions	6/10/2015	37,700		(2)	144,000	(2)			(3)		—			2018
Atlanta Perimeter	Atlanta, GA	State Farm Mutual Automobile Insurance Company	6/10/2015	101,670		(2)	584,800	(2)			(3)		—			2023
Herndon	Herndon, VA	Time Warner Cable Southeast, LLC	6/10/2015	87,300		(2)	268,200	(2)			(3)		—			2019
Deerfield	Deerfield, IL	CF Industries Holdings, Inc.	6/10/2015	42,900		(2)	171,900	(2)			(3)		—			2027
DreamWorks	Glendale, CA	DreamWorks Animation SKG, Inc.	7/21/2015	215,000			459,800	(4)			205,000		—			2035
Restoration Hardware	Patterson, CA	Restoration Hardware, Inc.	8/15/2015	99,850		(5)	1,501,400	2,965		(5)	—		—			2030
Highway 94	Jefferson City, MO	ABB, Inc.	11/6/2015	31,940			660,000	958			—		19,033		(6)	2024
DynCorp	Fort Worth, TX	DynCorp International, LLC	12/11/2015	16,650			119,000	499			—		11,162		(6)	2018
Mercedes-Benz	Fort Worth, TX	Mercedes-Benz Financial Services USA	12/11/2015	29,000			164,300	870			—		18,945		(6)	2018

Property	Location	Tenant/Major Lessee	Acquisition/ Merger Date	Purchase Price		Approx. Square Feet	Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)		Unsecured Credit Facility		Other Debt Financings			Year of Lease Expiration (for Major Lessee)
Samsonite	Jacksonville, FL	Samsonite, LLC	12/11/2015	48,000		817,700	1,440		—		24,561		(6)	2024
				$	1,190,540	6,982,600	$	11,022	$	331,100	$	73,701

(1) The Advisor is entitled to receive acquisition fees equal to 2.5% and acquisition expense reimbursement of up to 0.5% of the contract purchase price for each property acquired. The total is included in acquisition fees and expenses to affiliates on the consolidated statements of operations.

(2) Represents a property assumed through the SOR Merger. Purchase Price represents purchase price allocations based on real estate value of $607.1 million. In conjunction with the SOR Merger on June 10, 2015, the Advisor received acquisition fees equal to 2.5%, or approximately $15.2 million, of the real estate value of $607.1 million. In addition, the Advisor also received actual expense reimbursements of $2.8 million, which was paid on July 14, 2015.

(3) In connection with the SOR Merger on June 10, 2015, the Company, through the Operating Partnership, borrowed $173.0 million from the Unsecured revolver (May 2014) to repay the outstanding SOR debt, as discussed in Note 5, Debt.

(4) The Advisor received acquisition fees equal to 2.5%, or approximately $5.4 million, of the acquisition value of $215.0 million. In addition, the Advisor also received actual expense reimbursements of $0.8 million.

(5) Represents a development project with WRRH Patterson, LLC, which was placed into service on August 15, 2015. The total acquisition fees and expense reimbursements payable to the Advisor were included in the basis of the property, as discussed in Note 4, Investments.

(6) Represents the mortgage loans assumed in conjunction with the acquisitions of the Highway 94, DynCorp, Mercedes-Benz, and Samsonite properties. See Note 5, Debt.

The following summarizes the purchase price allocation of the 2015 acquisitions and SOR Merger:

Property	Land		Building and improvements		Tenant origination and absorption cost		In-place lease valuation - above/(below) market			Debt discount/(premium)			Total
GE Aviation	$	4,400	$	52,211	$	9,470	$	(81	)	$	—		$	66,000
Westgate III	3,209		60,852		15,085		(2,146		)	—			77,000
DreamWorks	26,387		148,163		42,642		(2,192		)	—			215,000
Highway 94 (1)	5,540		21,300		6,930		(4,080		)	2,250			31,940
DynCorp (1)	1,952		13,546		1,994		(842		)	—			16,650
Mercedes-Benz (1)	2,330		23,424		2,952		294			—			29,000
Samsonite (1)	5,040		37,152		5,338		1,971			(1,501		)	48,000
Total acquisitions	$	48,858	$	356,648	$	84,411	$	(7,076	)	$	749		$	483,590
Lisle	2,788		11,209		4,991		512			—			19,500
Bloomingdale	1,178		4,689		493		1,090			—			7,450
Columbia	6,989		42,690		4,185		4,266			—			58,130
Denver	9,948		22,714		1,174		1,164			—			35,000
Columbus	2,943		14,896		7,755		2,006			—			27,600
Miramar	4,488		18,211		1,768		133			—			24,600
Irving Carpenter	1,842		19,479		2,573		(394		)	—			23,500
Frisco	8,239		47,296		4,099		(384		)	—			59,250
Houston Westway II	3,961		67,484		11,184		(129		)	—			82,500
Houston Westway I	6,540		27,765		2,938		457			—			37,700
Atlanta Perimeter	8,607		63,247		33,472		(3,656		)	—			101,670
Herndon	9,667		66,303		7,794		3,536			—			87,300
Deerfield	4,339		30,367		6,931		1,263			—			42,900
Total SOR Merger	$	71,529	$	436,350	$	89,357	$	9,864		$	—		$	607,100
Total acquisitions and SOR Merger	$	120,387	$	792,998	$	173,768	$	2,788		$	749		$	1,090,690

(1) As of December 31, 2015, the purchase price allocation for the Highway 94, DynCorp, Mercedes-Benz, and Samsonite properties had not been finalized.

Pro Forma Financial Information (unaudited)

The following condensed pro forma operating information is presented as if the Company’s properties acquired in 2015 had been included in operations as of January 1, 2014. The pro forma operating information includes certain nonrecurring adjustments, such as acquisition fees and expenses incurred as a result of the assets acquired in the acquisitions:

	Year Ended December 31,
	2015			2014
Revenue	$	345,092		$	318,720
Net income	$	63,170		$	49,499
Net income attributable to noncontrolling interests	$	1,259		$	979
Distributions to redeemable noncontrolling interests attributable to common stockholders	$	(359	)	$	(355	)
Net income attributable to common stockholders (1)	$	42,402		$	29,154
Net income attributable to common stockholders per share, basic and diluted	$	0.24		$	0.19

(1) Amount is net of net income (loss) attributable to noncontrolling interests and distributions to redeemable noncontrolling interests attributable to common stockholders.

The future minimum contractual rent payments pursuant to the lease terms, with lease expirations ranging from 2016 to 2035, are shown in the table below:

2016	$	254,246
2017	253,976
2018	246,264
2019	215,126
2020	189,114
Thereafter	1,001,398
Total	$	2,160,124

Tenant and Portfolio Risk

The Company monitors the credit of all tenants to stay abreast of any material changes in credit quality. The Company monitors tenant credit by (1) reviewing the credit ratings of tenants (or their parent companies or lease guarantors) that are rated by nationally recognized rating agencies; (2) reviewing financial statements and related metrics and information that are publicly available or that are required to be provided pursuant to the lease; (3) monitoring news reports and press releases regarding the tenants (or their parent companies or lease guarantors), and their underlying business and industry; and (4) monitoring the timeliness of rent collections.

Tenant security deposits as of December 31, 2015 and 2014, which were included in the accounts payable and other liabilities balance on the consolidated balance sheets, totaled $0.8 million and $0.2 million, net of tenant security deposits related to the real estate held for sale, respectively, as required pursuant to the leases for certain tenants. The Company bears the full risk of tenant rent collections for those leases in which a security deposit is not required. Certain leases do, however, require the tenant to pay a penalty in the event of early termination, which fee would be utilized for re-tenanting and restoration. Tenant receivables, which the Company deemed to be fully collectible, totaled $2.2 million and $0.3 million, net of tenant receivables related to the real estate held for sale, as of December 31, 2015 and 2014, respectively. Tenant receivables are included in other assets, net, on the consolidated balance sheets.

In conjunction with certain assets contributed to the Company in exchange for limited partnership units of the Operating Partnership, the Company effected tax protection agreements in favor of the contributor whereby the Company would be liable to reimburse the contributor, through a special distribution, for any tax liability incurred by the contributor as a result of the disposal of the contributed asset, for a time period specified in the tax protection agreement. As of December 31, 2015, the Company has not been obligated to any contributor for a tax liability incurred as a result of an asset disposition.

Sale of College Park Property

On February 20, 2015, the Company sold the College Park property located in Indianapolis, Indiana for total proceeds of $14.3 million, less closing costs and other closing credits of approximately $2.5 million. The carrying value of the College Park property on the closing date was approximately $8.2 million, which was comprised of $6.4 million of real estate assets, net, $0.8 million of deferred rent, and $1.0 million of other leasing costs, such as leasing commissions. Upon the sale of the College Park property, the Company recognized a gain of $3.6 million. In conjunction with the sale, the Advisor was paid a disposition fee of approximately $0.1 million, in accordance with the Advisory Agreement. The Company elected to complete the sale as part of a tax-deferred exchange of real estate as permitted by Section 1031 of the Internal Revenue Code, and thus, the proceeds of the sale of the College Park property were deposited with a qualified intermediary. The funds were subsequently released upon the Company's acquisition of the GE Aviation property.

Sale of Will Partners Property

On August 7, 2015, the Company sold the Will Partners property located in Monee, Illinois, for total proceeds of $22.0 million, less closing costs and other closing credits of approximately $0.8 million. The carrying value of the Will Partners property on the closing date was approximately $17.1 million, which was primarily comprised of real estate assets, net, and other liabilities. Upon the sale of the property, the Company recognized a gain of approximately $4.1 million. In conjunction with the sale, the Advisor was paid a disposition fee of approximately $0.2 million, in accordance with the Advisory Agreement. The Company elected to complete the sale as part of a tax-deferred exchange of real estate as permitted by Section 1031 of the Internal Revenue Code, and thus, the proceeds of the sale of the property were deposited with a qualified intermediary.

Sale of LTI Property

On December 31, 2015, Life Technologies Corporation, the tenant previously occupying the LTI property, exercised its option to purchase the building located in Carlsbad, California, for total proceeds of $57.4 million, less closing costs of approximately $0.3 million. The carrying value of the LTI property on the closing date was approximately $51.0 million, which was comprised of $45.2 million of real estate assets, net, $1.6 million of deferred rent, and $4.2 million of other intangibles, such as tenant absorption costs and below market rent, net. Upon the sale of the property, the Company recognized a gain of approximately $6.1 million. In conjunction with the sale, the Advisor was paid a disposition fee of approximately $0.3 million, in accordance with the Advisory Agreement. The Company elected to complete the sale as part of a tax-deferred exchange of real estate as permitted by Section 1031 of the Internal Revenue Code, and thus, the proceeds of the sale of the property were deposited with a qualified intermediary.

Asset Held for Sale

As of December 31, 2015, one property, the One Century Place property located in Nashville, Tennessee, met the criteria to be classified as held for sale. Therefore, the Company classified the property as held for sale, net, on the consolidated balance sheets at the lower of its (i) carrying amount or (ii) fair value less costs to sell as of December 31, 2015. The summary includes the College Park, Will Partners, LTI and One Century Place properties as of December 31, 2014. Since the College Park and Will Partners properties were sold during 2015, the properties were not included in the current year balance sheet. The College Park, Will Partners, LTI and One Century Place properties are included in continuing operations in the consolidated statements of operations based on the Company's early adoption of ASU No. 2014-08, as it did not meet the prerequisite requirements to be classified as discontinued operations.

The following summary presents the major components of assets and liabilities related to the real estate held for sale as of December 31, 2015 and 2014:

	Balance December 31, 2015			Balance December 31, 2014
Restricted cash	$	561		$	1,450
Real Estate:
Land	8,025			10,256
Building	42,858			66,629
Tenant origination and absorption cost	20,003			21,400
Construction in progress	22			271
Total Real Estate	70,908			98,556
Less: accumulated depreciation and amortization	(7,034		)	(7,893		)
Total real estate, net	63,874			90,663
In-place lease valuation - above market	813			813
Deferred rent	2,716			2,135
Other assets	829			1,801
Total assets	$	68,793		$	96,862
Accounts payable and other liabilities	$	2,203		$	2,763
Due to affiliates	81			104
Restricted reserve	561			1,039
Total liabilities	$	2,845		$	3,906

The following is a summary of the income (loss) included in the Company's income from continuing operations for the years ended December 31, 2015, 2014, and 2013 from assets classified as held for sale subsequent to the Company's adoption of ASU No. 2014-08, which includes the College Park, Will Partners, and One Century Place properties:

	Year Ended December 31,
	2015			2014			2013
Total revenues	$	12,128		$	13,231		$	5,254
Operating expenses	(6,368		)	(8,306		)	(4,189		)
Total revenues less operating expenses from assets classified as "held for sale," not qualifying as discontinued operations	5,760			4,925			1,065
Depreciation and amortization expense	(2,554		)	(8,156		)	(2,041		)
Interest expense	—			(907		)	(170		)
Income (loss) from assets classified as "held for sale," not qualifying as discontinued operations	$	3,206		$	(4,138	)	$	(1,146	)

Intangibles

The Company allocated a portion of the acquired and contributed real estate asset value to in-place lease valuation and tenant origination and absorption cost, as discussed above and as shown below, net of the write-off of intangibles for the years ended December 31, 2015 and 2014. In-place leases were measured against comparable leasing information and the present value of the difference between the contractual, in-place rent, and the fair market rent was calculated using, as the discount rate, the capitalization rate utilized to compute the value of the real estate at acquisition or contribution.

	Balance December 31, 2015			Balance December 31, 2014
In-place lease valuation (above market)	$	45,413		$	26,289
In-place lease valuation (above market) - accumulated amortization	(10,844		)	(4,896		)
In-place lease valuation (above market), net	34,569			21,393
Ground leasehold interest (below market)	2,254			2,254
Ground leasehold interest (below market) - accumulated amortization	(54		)	(26		)
Ground leasehold interest (below market), net	2,200			2,228
Intangible assets, net	$	36,769		$	23,621
In-place lease valuation (below market)	$	(55,774	)	$	(48,448	)
In-place lease valuation (below market) - accumulated amortization	14,068			8,054
In-place lease valuation (below market), net	$	(41,706	)	$	(40,394	)
Tenant origination and absorption cost	$	516,879		$	359,416
Tenant origination and absorption cost - accumulated amortization	(119,593		)	(58,679		)
Tenant origination and absorption cost, net	$	397,286		$	300,737

The intangible assets are amortized over the remaining lease term of each property, which on a weighted-average basis, was approximately 7.8 years and 7.9 years as of December 31, 2015 and 2014, respectively. The amortization of the intangible assets and other leasing costs for the respective periods is as follows:

	Amortization (income) expense for the year ended December 31,
	2015			2014			2013
In-place lease valuation	$	(3,785	)	$	(468	)	$	(546	)
Tenant origination and absorption cost	$	69,099		$	45,044		$	14,098
Ground leasehold amortization (below market)	$	28		$	26		$	—
Other leasing costs amortization	$	301		$	143		$	—

The following table sets forth the estimated annual amortization (income) expense for in-place lease valuation, net, tenant origination and absorption costs, ground leasehold improvements, and other leasing costs as of December 31, 2015 for the next five years:

Year	In-place lease valuation, net			Tenant origination and absorption costs		Ground leasehold improvements		Other leasing costs
2016	$	1,028		$	63,111	$	28	$	1,000
2017	$	495		$	60,293	$	28	$	1,229
2018	$	(226	)	$	53,948	$	28	$	1,481
2019	$	(1,990	)	$	44,201	$	28	$	1,481
2020	$	(1,228	)	$	35,109	$	28	$	1,457

Restricted Cash

In conjunction with the contribution of certain assets, as required by certain lease provisions or certain lenders in conjunction with an acquisition or debt financing, or credits received by the seller of certain assets, the Company assumed or funded reserves for specific property improvements and deferred maintenance, re-leasing costs, and taxes and insurance, which are included on the consolidated balance sheets as restricted cash. Additionally, an ongoing replacement reserve is funded by certain tenants pursuant to each tenant’s respective lease as follows:

	Balance December 31, 2014		Additions		Deductions			Balance December 31, 2015
Tenant improvement reserves (1)	$	36,931	$	1,904	$	(25,942	)	$	12,893
Midland Mortgage loan repairs reserves (2)	453		—		—			453
Real estate tax reserve (Emporia Partners, TW Telecom, DynCorp, and Mercedes-Benz) (3)	1,074		2,601		(1,784		)	1,891
Property insurance reserve (Emporia Partners) (3)	251		494		(444		)	301
Restricted deposits	20		—		—			20
Midland Mortgage loan restricted lockbox (4)	2,023		2,044		(2,023		)	2,044
Restricted rent receipts (5)	—		6,585		—			6,585
	$	40,752	$	13,628	$	(30,193	)	$	24,187

(1) Additions represent tenant improvement reserves funded by the tenant and held by the lender. Deductions represent tenant improvement reimbursements made to certain tenants during the current period.

(2) Represents a deferred maintenance reserve funded by the Company as part of the refinancing that occurred on February 28, 2013, whereby certain properties became collateral for the Midland Mortgage loan.

(3) Additions represent monthly funding of real estate taxes and insurance by the tenants during the current period. Deductions represent reimbursements to the tenant for payment of real estate taxes and insurance premiums made during the current period.

(4) As part of the terms of the Midland Mortgage loan, rent collections from the eight properties which serve as collateral thereunder are received in a designated cash collateral account which is controlled by the lender until the designated payment date, as defined in the loan agreement, and the excess cash is transferred to the operating account.

(5) Addition represents rent and prepaid rent received from the DreamWorks property from August 2015 through January 2016, which is to be held in escrow pending a tax-deferred real estate exchange, as permitted by Section 1031 of the Internal Revenue Code, with the sale of the Will Partners and LTI properties. Such exchange was completed on January 12, 2016, thus, releasing any restrictions on the DreamWorks rent receipts.

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Investments

12 Months Ended

Dec. 31, 2015

Equity Method Investments and Joint Ventures [Abstract]

Investments

Investments

Investments in Unconsolidated Entities

On April 10, 2013, a Delaware Statutory Trust ("DST") affiliated with the Sponsor acquired a two-building, single-story office campus located in Nashville, Tennessee (the "HealthSpring property") for a purchase price of $36.4 million. The DST was then syndicated for $39.6 million which consists of mortgage debt of $23.6 million and an equity contribution of $16.0 million. The HealthSpring property is leased in its entirety pursuant to a tripe-net lease to HealthSpring, Inc. ("HealthSpring"), obligating HealthSpring to all costs and expenses to operate and maintain the property, including certain capital expenditures. On the acquisition date, the remaining term was approximately nine years. On April 12, 2013, the Company, through the Operating Partnership, acquired a 10% beneficial ownership interest in the DST, net of a 10% discount associated with offering expenses. The Operating Partnership has the ability to exercise two exchange rights in which it can acquire additional beneficial interests in the DST at fair value. The initial exchange right, which may be exercised by the Operating Partnership at any point after the beneficial owners have held their interest in the DST for at least one year, allows each investor to sell or retain its interest in the DST or exchange its interest in the DST for units in the Operating Partnership ("the Units"). The secondary exchange right, which may not be exercised by the Operating Partnership until at least five years after the date of the agreement, allows each investor to either exchange their interest in the DST for units in the Operating Partnership or cash.

As of December 31, 2015, the Operating Partnership had exercised its initial exchange right. Approximately 73% of the beneficial owners of HealthSpring interests elected to exchange their interest in the DST for the Units, and the remaining 27% elected to be paid in cash. Until a contribution agreement is executed, the beneficial owners can change their contribution election or remain in the DST. The exchange is expected to be completed in the first quarter of 2016.

On September 9, 2014, the Company, through a special purpose entity ("SPE"), wholly-owned by the Operating Partnership, acquired an 80% interest in a joint venture with an affiliate of Digital Realty Trust, Inc. for $68.4 million, which was funded with equity proceeds raised in the Company's Public Offering. The gross acquisition value of the property was $187.5 million, plus closing costs, which was partially acquired with debt of $102.0 million. The joint venture was created for purposes of directly or indirectly acquiring, owning, financing, operating and maintaining a data center facility located in Ashburn, Virginia (the "Property"). The Property is approximately 132,300 square feet and consists of certain data processing and communications equipment that is fully leased to a social media company and a financial services company with an average remaining lease term of approximately seven years.

The joint venture currently uses an interest rate swap to manage its interest rate risk associated with its variable rate debt. The interest rate swap is designated as an interest rate hedge of its exposure to the volatility associated with interest rates. As a result of the hedge designation and in satisfying the requirement for cash flow hedge accounting, the joint venture records changes in the fair value in accumulated other comprehensive loss. In conjunction with the investment in the joint venture discussed above, the Company recognized its 80% share, or approximately $(0.2) million, of other comprehensive loss for the year ended December 31, 2015.

The interests discussed above are deemed to be a variable interest in a VIE, and, based on an evaluation of the variable interest against the criteria for consolidation, the Company determined that it is not the primary beneficiary of the investments, as the Company does not have power to direct the activities of the entity that most significantly affect its performance. As such, the interests in the VIEs are recorded using the equity method of accounting in the accompanying consolidated financial statements. Under the equity method, the investments in the unconsolidated entities are stated at cost and adjusted for the Company's share of net earnings or losses and reduced by distributions. Equity in earnings of real estate ventures is generally recognized based on the allocation of cash distributions upon liquidation of the investment at book value in accordance with the operating agreements.

As of December 31, 2015, the balance of the investments totaled approximately $56.9 million as shown below:

	HealthSpring DST			Digital Realty Joint Venture			Total
Balance December 31, 2014	$	1,351		$	64,898		$	66,249
Other comprehensive loss	—			(189		)	(189		)
Net income (loss)	35			(1,510		)	(1,475		)
Distributions	(95		)	(7,627		)	(7,722		)
Balance December 31, 2015	$	1,291		$	55,572		$	56,863

Investments in Consolidated Entities

Effective June 16, 2014, WRRH Patterson, LLC (an affiliate of Weeks Robinson Properties) and Griffin Capital JVII Patterson, LLC, a wholly-owned SPE of the Operating Partnership, entered into an operating agreement as Managing Member and Investor Member, respectively, for purposes of forming WR Griffin Patterson, LLC ("WR Griffin"). WR Griffin's purpose is to acquire, own, develop, construct, and otherwise invest and manage a development project located in Patterson, California (the "Project") in which a warehouse and distribution facility consisting of approximately 1.5 million square feet was subsequently constructed (the "Restoration Hardware property").

On June 20, 2014, the Company, through WR Griffin, entered into a real estate development agreement with Weeks Robinson Development & Management, LLC ("Weeks Robinson") to develop and construct the Restoration Hardware property. Concurrently, the land on which the property was to be constructed was purchased by WR Griffin for approximately $15.2 million, including closing costs.

The Restoration Hardware property is leased to Restoration Hardware, Inc. and Restoration Hardware Holdings, Inc. as co-tenants (collectively, "Restoration Hardware") pursuant to a 15-year triple-net lease, obligating Restoration Hardware to all costs and expenses to operate and maintain the property, including certain capital expenditures. The lease term commenced upon substantial completion of the project, which occurred on August 15, 2015.

During the construction of the Project, the business and affairs of WR Griffin were managed by the Managing Member. However, all major decisions, as provided in the operating agreement, were approved by both the Managing Member and Investor Member. Additionally, the Managing Member interest, pursuant to the purchase and sale agreement, has been assigned to the Investor Member in exchange for a mandatory redemption fee based on the fair value of the property at completion. As a result of the assignment, the Managing Member will transfer all membership interest to the Investor Member upon completion of certain terms included in the operating agreement, which is expected to occur in the first quarter in 2016.

The Company determined that control of the joint venture lies with its wholly-owned SPE. As such, the Company, in consolidation with the joint venture, included the following amounts on its consolidated balance sheet as of December 31, 2015 and 2014:

	Balance December 31, 2015				Balance December 31, 2014
Cash on hand	$	4,711			$	6,985
Deferred rent	372				—
Other assets	59				—
Construction in progress - paid by the joint venture	—				34,739
Construction in progress - paid by the Company	—				70
Leasing commissions, net	731				375
Land	15,463			(1)	15,185
Building	57,595			(1)	—
Tenant improvements	18,040			(1)	—
Accumulated depreciation	(1,314		)		—
Construction in progress payable	—				(13,423		)
Accounts payable and other liabilities	(21,979		)		—
Due to affiliates	(3,324		)		—
Noncontrolling interest	—				(7,656		)
Total investment	$	70,354			$	36,275

(1) Includes $3.0 million of acquisition fees and expense reimbursements, as discussed in Note 3, Real Estate.

Transfer of construction in progress to fixed assets

The Company is required to capitalize project costs, including pre-development costs, interest, property taxes, insurance, and other costs directly related and essential to the acquisition, development, redevelopment, or construction of a project. Capitalization of development, redevelopment, and construction costs is required while activities are ongoing to prepare an asset for its intended use. When construction activities are substantially complete, the asset is transferred out of construction in progress and classified as rental property. On August 15, 2015, the Project was substantially complete and ready for its intended use, at which time Restoration Hardware began to occupy the facility and the lease commenced. Concurrent with the property being delivered to Restoration Hardware, the Company allocated the construction in progress balance between building and tenant improvements and began to depreciate the assets over the estimated useful lives.

Mandatory redemption

As noted above, the Managing Member's interest pursuant to the purchase and sale agreement has been assigned to the Investor Member in exchange for a mandatory redemption fee. As a result of the assignment, the Managing Member will transfer all membership interest to the Investor Member upon satisfying certain terms included in the operating agreement, including the completion of the Project and payment of the mandatory redemption fee, which is based on the estimated fair value of the property at completion. As of December 31, 2015, the Company agreed to pay the mandatory redemption fee of approximately $18.1 million, thus, reclassifying the noncontrolling interest from temporary equity to a liability on the consolidated balance sheet. The redemption of the Managing Member's interest includes their initial contribution of approximately $7.7 million.

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Debt

12 Months Ended

Dec. 31, 2015

Debt Disclosure [Abstract]

Debt

Debt

As of December 31, 2015 and 2014, the Company’s debt consisted of the following:

	Balance December 31, 2015			Balance December 31, 2014		Contractual Interest Rate (1)		Payment Type	Loan Maturity
Plainfield mortgage loan	$	19,295		$	19,638	6.650%		Principal and Interest	November 2017
Emporia Partners mortgage loan	3,753			4,108		5.880%		Principal and Interest	September 2023
LTI mortgage loan	—			32,128		5.800%		Principal and Interest	March 2016
LTI mortgage loan premium	—			102		—		—	—
TransDigm mortgage loan	6,432			6,576		5.980%		Principal and Interest	June 2016
TransDigm mortgage loan premium	22			75		—		—	—
Ace Hardware mortgage loan	23,294			23,648		5.588%		Principal and Interest	October 2024
Ace Hardware mortgage loan premium	1,508			1,681		—		—	—
Highway 94 mortgage loan	18,968			—		3.750%		Principal and Interest	August 2024
Highway 94 mortgage loan discount	(2,210		)	—		—		—	—
DynCorp mortgage loan	11,162			—		4.700%		Principal and Interest	July 2016
Mercedes-Benz mortgage loan	18,945			—		6.018%		Principal and Interest	November 2016
Samsonite mortgage loan	24,561			—		6.080%		Principal and Interest	September 2023
Samsonite mortgage loan premium	1,490			—		—		—	—
Midland Mortgage loan	105,600			105,600		3.940%		Interest Only through March 2017/Principal and Interest thereafter	April 2023
AIG loan	110,640			110,640		4.960%		Interest Only through January 2017/Principal and Interest thereafter	February 2029
TW Telecom loan	21,213			21,500		LIBO Rate +2.45%	(2)	Interest Only through July 2015/Principal and Interest thereafter	August 2019
Mortgage Loan Total	364,673			325,696
Unsecured term loan (May 2014)	—			300,000		LIBO Rate +1.45%		Interest Only	May 2019
Term Loan (July 2015)	640,000			—		LIBO Rate +1.25%	(2)	Interest Only	July 2020
Revolver Loan (July 2015)	481,653			—		LIBO Rate +1.30%	(2)	Interest Only	July 2020	(3)
Total	$	1,486,326		$	625,696

(1) Including the effect of an interest rate swap agreement with a notional amount of $425.0 million, the weighted average interest rate as of December 31, 2015 was 2.8% for the Company's fixed-rate and variable-rate debt combined and approximately 3.8% for the Company's fixed-rate debt only.

(2) The LIBO Rate as of December 31, 2015 was 0.30% (effective as of December 11, 2015).

(3) The Revolver Loan (July 2015) has an initial term of four years, maturing on July 20, 2019, and may be extended for a one-year period if certain conditions are met and upon payment of an extension fee. See discussion below.

Unsecured Credit Facility (July 2015)

On July 20, 2015, the Company, through the Operating Partnership, entered into a credit agreement (the "Unsecured Credit Agreement (July 2015)") with a syndicate of lenders, co-led by KeyBank, Bank of America, Fifth Third Bank ("Fifth Third"), and BMO Harris Bank, N.A. ("BMO Harris"), under which KeyBank serves as administrative agent and Bank of America, Fifth Third, and BMO Harris serve as co-syndication agents, and KeyBanc Capital Markets ("KeyBank Capital Markets"), Merrill Lynch, Pierce, Fenner & Smith Incorporated ("Merrill Lynch"), Fifth Third, and BMO Capital Markets serve as joint bookrunners and joint lead arrangers. Pursuant to the Unsecured Credit Agreement (July 2015), the Company was provided with a $1.14 billion senior unsecured credit facility (the "Unsecured Credit Facility (July 2015)"), consisting of a $500.0 million senior unsecured revolver (the "Revolver Loan (July 2015)") and a $640.0 million senior unsecured term loan (the "Term Loan (July 2015)"). The Unsecured Credit Facility (July 2015) may be increased up to $860.0 million, in minimum increments of $50.0 million, for a maximum of $2.0 billion by increasing either the Revolver Loan (July 2015), the Term Loan (July 2015), or both. The Revolver Loan (July 2015) has an initial term of four years, maturing on July 20, 2019, and may be extended for a one year period if certain conditions are met and upon payment of an extension fee. The Term Loan (July 2015) has a term of five years, maturing on July 20, 2020.

The Unsecured Credit Facility (July 2015) has an interest rate calculated based on LIBO Rate plus the applicable LIBO Rate margin or Base Rate plus the applicable Base Rate margin, both as provided in the Unsecured Credit Agreement (July 2015). The applicable LIBO Rate margin and Base Rate margin are dependent on whether the interest rate is calculated prior to or after the Company has received an investment grade senior unsecured credit rating of BBB-/Baa3 from Standard & Poors, Moody's, or Fitch, and the Company has elected to utilize the investment grade pricing list, as provided in the Unsecured Credit Agreement (July 2015). Otherwise, the applicable LIBO Rate margin will be based on a leverage ratio computed in accordance with the Company's quarterly compliance package and communicated to KeyBank. The Base Rate is calculated as the greater of (i) the KeyBank Prime rate or (ii) the Federal Funds rate plus 0.50%. Payments under the Unsecured Credit Facility (July 2015) are interest only and are due on the first day of each quarter. In connection with the Unsecured Credit Agreement (July 2015), the Company incurred approximately $4.1 million of deferred financing costs, which are being amortized as a component of interest expense over the term of the agreement.

Highway 94 Mortgage Loan

As part of the acquisition of the Highway 94 property, the Company assumed a $19.0 million mortgage loan (the "Highway 94 mortgage loan") from Wells Fargo Bank Northwest, N.A., and Teachers Insurance and Annuity Association, as participating holder of the note. The Highway 94 mortgage loan matures on August 1, 2024, has a fixed interest rate of 3.75%, and requires monthly payments of principal and interest.

DynCorp Mortgage Loan, Mercedes-Benz Mortgage Loan, and Samsonite Mortgage Loan

On December 11, 2015, the Company, through three wholly-owned subsidiaries of the Operating Partnership, assumed the following property mortgage loans related to the acquisition of the following three properties:

• DynCorp - Approximately $11.2 million, secured by the DynCorp property (the "DynCorp mortgage loan"). The DynCorp mortgage loan has a fixed interest rate of 4.70%, matures in July 2016, and requires monthly principal and interest payments.

• Mercedes-Benz - Approximately $18.9 million, secured by the Mercedes-Benz property (the "Mercedes-Benz mortgage loan"). The Mercedes-Benz mortgage loan has a fixed interest rate of 6.018%, matures in November 2016, and requires monthly principal and interest payments.

• Samsonite - Approximately $24.6 million, secured by the Samsonite property (the "Samsonite mortgage loan"). The Samsonite mortgage loan has a fixed interest rate of 6.08%, matures in September 2023, and requires monthly principal and interest payments.

Debt Covenant Compliance

Pursuant to the terms of the Midland Mortgage loan, AIG loan, TW Telecom loan, Unsecured Credit Facility (July 2015), DynCorp mortgage loan, and Mercedes-Benz mortgage loan, the Operating Partnership, in consolidation with the Company, is subject to certain loan compliance covenants. The Company was in compliance with all of its debt covenants for each quarter of 2015 and as of December 31, 2015.

The following summarizes the future principal repayments of all loans as of December 31, 2015 per the loan terms discussed above:

	December 31, 2015
2016	$	40,078	(1)
2017	22,237		(2)
2018	7,077
2019	25,153		(3)
2020	1,128,486		(4)
Thereafter	262,485		(4)
Total principal	1,485,516
Unamortized debt premium	810
Total	$	1,486,326

(1) Amount includes payment of the balances of the TransDigm, DynCorp, and Mercedes-Benz property mortgage loans, which mature in 2016.

(2) Amount includes payment of the balance of the Plainfield property mortgage loan, which matures in 2017.

(3) Amount includes payment of the balance of the TW Telecom loan, which matures in 2019.

(4) Amount includes payment of the balances of:

• the Term Loan (July 2015), which matures in 2020,

• the Revolver Loan (July 2015), which matures in 2020, assuming the one-year extension is exercised,

• the Midland Mortgage, Emporia Partners, and Samsonite property mortgage loans, all of which mature in 2023,

• the Ace Hardware and Highway 94 property mortgage loans, which mature in 2024, and

• the AIG loan, which matures in 2029.

Principal repayments on the TransDigm, Ace Hardware, Highway 94, and Samsonite property mortgage loans do not include the unamortized valuation net premium of $0.8 million.

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Interest Rate Contracts

12 Months Ended

Dec. 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Interest Rate Contracts

Interest Rate Contracts

Risk Management Objective of Using Derivatives

The Company is exposed to certain risks arising from both business operations and economic conditions. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of debt funding and the use of derivative financial instruments. Specifically, the Company entered into derivative financial instruments to manage exposures that arise from business activities that result in the payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The derivative financial instruments are used to manage differences in the amount, timing, and duration of known or expected cash payments principally related to borrowings.

Derivative Instruments

The objectives in using interest rate derivatives are to add stability to interest expense and to manage exposure to interest rate movements. To accomplish this objective, the Company uses interest rate swaps as part of interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. The Company does not use derivatives for trading or speculative purposes.

On July 9, 2015, the Company executed three interest rate swap agreements to hedge the variable cash flows associated with certain existing LIBO Rate-based variable-rate debt, including the Company's Unsecured Credit Facility (July 2015). The first interest rate swap is effective for the period from July 9, 2015 to July 1, 2020 with a notional amount of $425.0 million. The two forward-starting interest rate swap transactions are effective for the periods from January 1, 2016 to July 1, 2018 and July 1, 2016 to July 1, 2018, and have notional amounts of $300.0 million and $100.0 million, respectively.

The effective portion of the change in fair value of derivatives designated and qualifying as cash flow hedges is initially recorded in accumulated other comprehensive income (loss) and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. Amounts reported in accumulated other comprehensive income (loss) related to derivatives will be reclassified to interest expense as interest payments and accruals are made on our variable-rate debt. During the next twelve months, the Company estimates that an additional $6.5 million will be released from accumulated other comprehensive income (loss) into earnings.

During the year ended December 31, 2015, the amount of income (loss) into earnings under "interest expense" was approximately $3.1 million. The ineffective portion of the change in fair value of the derivatives is immediately recognized in earnings. During the year ended December 31, 2015, the Company recognized, in earnings, less than $0.1 million related to the ineffective portion of the interest rate swaps.

The following table sets forth a summary of the interest rate swaps at December 31, 2015:

		Maturity	Interest	Fair value (2)			Current Notional Amount (3)
Derivative Instrument	Effective Date (1)	Date	Strike Rate	December 31, 2015			December 31, 2015
Liabilities:
Interest Rate Swap	7/9/2015	7/1/2020	1.687%	$	(4,305	)	$	425,000
Interest Rate Swap	1/1/2016	7/1/2018	1.320%	$	(1,605	)	$	—
Interest Rate Swap	7/1/2016	7/1/2018	1.495%	$	(484	)	$	—

(1) The Company entered into all interest rate swap agreements in 2015. Thus, no prior period information is available.

(2) The Company records all derivative instruments on a gross basis on the consolidated balance sheets, and accordingly, there are no offsetting amounts that net assets against liabilities. As of December 31, 2015, all of the derivatives were in a liability position, and as such, the fair value is included in the line item "Interest rate swap liability" on the consolidated balance sheets.

(3) Represents the notional amount of swaps that are effective as of the balance sheet date of December 31, 2015.

Certain agreements with the derivative counterparties contain a provision where if the Company defaults on any of the Company's indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender within a specified time period, then the Company could also be declared in default on its derivative obligations.

As of December 31, 2015, the fair value of interest rate swaps in a net liability position, which excludes any adjustment for nonperformance risk related to these agreements, was approximately $6.4 million. As of December 31, 2015, the Company had not posted any collateral related to these agreements.

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Fair Value Measurements

12 Months Ended

Dec. 31, 2015

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

The Company is required to disclose fair value information about all financial instruments, whether or not recognized in the consolidated balance sheets, for which it is practicable to estimate fair value. The Company measures and discloses the estimated fair value of financial assets and liabilities utilizing a fair value hierarchy that distinguishes between data obtained from sources independent of the reporting entity and the reporting entity’s own assumptions about market participant assumptions. This hierarchy consists of three broad levels, as follows: (i) quoted prices in active markets for identical assets or liabilities, (ii) "significant other observable inputs," and (iii) "significant unobservable inputs." "Significant other observable inputs" can include quoted prices for similar assets or liabilities in active markets, as well as inputs that are observable for the asset or liability, such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals. "Significant unobservable inputs" are typically based on an entity’s own assumptions, since there is little, if any, related market activity. In instances in which the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level of input that is significant to the fair value measurement in its entirety. The Company's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. There were no transfers between the levels in the fair value hierarchy during the years ended December 31, 2015 and 2014.

The following tables set forth the liabilities that the Company measures at fair value on a recurring basis by level within the fair value hierarchy as of December 31, 2015:

Liabilities	Total Fair Value			Quoted Prices in Active Markets for Identical Assets and Liabilities		Significant Other Observable Inputs			Significant Unobservable Inputs
Interest Rate Swaps at (1):
December 31, 2015	$	(6,394	)	$	—	$	(6,394	)	$	—

(1) The Company entered into all interest rate swap agreements in 2015. Thus, no prior period information is available.

Financial Instruments Disclosed at Fair Value

Financial instruments as of December 31, 2015 consisted of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and other accrued expenses, and mortgage payable and other borrowings, as defined in Note 5, Debt. With the exception of the mortgage loans in the table below, the amounts of the financial instruments presented in the consolidated financial statements substantially approximate their fair value as of December 31, 2015 and 2014. The fair value of the 11 mortgage loans in the table below is estimated by discounting each loan’s principal balance over the remaining term of the mortgage using current borrowing rates available to the Company for debt instruments with similar terms and maturities. The Company determined that the mortgage debt valuation in its entirety is classified Level 2 of the fair value hierarchy, as the fair value is based on current pricing for debt with similar terms as the in-place debt.

	December 31, 2015				December 31, 2014
	Fair Value		Carrying Value (1)		Fair Value		Carrying Value (1)
Plainfield mortgage loan	$	20,240	$	19,295	$	20,994	$	19,638
Emporia Partners mortgage loan	3,742		3,753		4,434		4,108
LTI mortgage loan	—		—		32,742		32,128
TransDigm mortgage loan	6,432		6,432		6,748		6,576
Ace Hardware mortgage loan	23,778		23,294		26,424		23,648
Midland Mortgage loan	107,154		105,600		105,155		105,600
AIG loan	114,747		110,640		122,062		110,640
Highway 94 mortgage loan	17,658		18,968		—		—
DynCorp mortgage loan (2)	11,162		11,162		—		—
Mercedes-Benz mortgage loan (2)	18,945		18,945		—		—
Samsonite mortgage loan	26,044		24,561		—		—

(1) The carrying value of the TransDigm, Ace Hardware, Highway 94, and Samsonite property mortgage loans do not include the net debt premium of $0.8 million and $1.9 million as of December 31, 2015 and 2014, respectively. See Note 5, Debt, for details.

(2) The fair value is identical to the carrying value as of December 31, 2015 since all three property mortgage loans mature in 2016.

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Equity

12 Months Ended

Dec. 31, 2015

Equity [Abstract]

Equity

Equity

Preferred Equity

On November 5, 2013, in connection with the acquisition of the Investment Grade Portfolio, a portfolio of 18 properties, the Operating Partnership entered into a purchase agreement with an affiliate (the "Preferred Equity Investor") of Starwood Property Trust (“Starwood”), pursuant to which Starwood provided a $250.0 million equity investment in the Operating Partnership in exchange for 24,319,066 Series A Cumulative Exchangeable Preferred Units of limited partnership interest (the "Preferred Units") of the Operating Partnership. Pursuant to the terms of the purchase agreement, on May 14, 2015 and November 5, 2015, the Company, through the Operating Partnership, exercised its right to redeem the Preferred Units for $191.6 million and $64.1 million, respectively, including a liquidation preference and all accumulated and unpaid distributions. Effective November 5, 2015, the preferred equity investment was terminated.

Common Equity

As of December 31, 2015, the Company had received aggregate gross offering proceeds of approximately $1.4 billion from the sale of shares in the Private Offering, the Public Offerings, and the DRP Offerings, as discussed in Note 1, Organization. There were 175,184,519 shares outstanding at December 31, 2015, including shares issued pursuant to the DRP, less shares redeemed pursuant to the share redemption plan discussed below.

On October 22, 2015, the Company's board of directors, at the recommendation of the nominating and corporate governance committee comprised solely of independent directors, approved an estimated value per share of the Company's common stock of $10.40 (unaudited) based on the estimated value of the Company's assets less the estimated value of the Company's liabilities, or net asset value, divided by the number of shares outstanding on a fully diluted basis (the "NAV"), calculated as of September 30, 2015. The Company is providing this estimated value per share to assist broker dealers in connection with their obligations under applicable Financial Industry Regulatory Authority rules with respect to customer account statements. This valuation was performed in accordance with the provisions of Practice Guideline 2013-01, Valuations of Publicly Registered Non-Listed REITs, issued by the IPA in April 2013, in addition to guidance from the SEC.

The Company’s par value calculation and related additional paid in capital ("APIC") allocation from the inception of the offering was determined to be calculated incorrectly. The Company assessed the cumulative impact of the reclassification between the par value and APIC from inception and recorded a reduction to the par value of $1.2 million and a corresponding increase to APIC for the same amount to correct the balances as of December 31, 2015. In accordance with SEC Staff Accounting Bulletin (“SAB”) No. 99, Materiality and SAB No. 108 (“SAB 108”), Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements, the Company assessed the materiality of this correction on its consolidated financial statements for the year ended December 31, 2015, using both the roll-over method and iron-curtain method as defined in SAB 108. The Company concluded the effect was not material to its consolidated financial statements for any prior period and, as such, those financial statements are not materially misstated. The Company also concluded that recording the correction in 2015 did not have a material effect on its consolidated financial statements for the year ended December 31, 2015.

Distribution Reinvestment Plan (DRP)

The Company has adopted the DRP, which allows stockholders to have dividends and other distributions otherwise distributable to them invested in additional shares of common stock. No sales commissions or dealer manager fee will be paid on shares sold through the DRP. The Company may amend or terminate the DRP for any reason at any time upon 10 days' prior written notice to stockholders.

As of December 31, 2015 and 2014, $110.2 million and $57.7 million in shares of common stock, respectively, had been issued under the DRP, pursuant to the Private Offering, the Public Offerings, and the DRP Offerings.

Share Redemption Program

The Company has adopted a share redemption program ("SRP") that enables stockholders to sell their stock to the Company in limited circumstances. As long as the common stock is not listed on a national securities exchange or over-the-counter market, stockholders who have held their stock for at least one year may, under certain circumstances, be able to have all or any portion of their shares of stock redeemed by the Company. The Company may redeem, on a quarterly basis, the shares of stock presented for redemption for cash to the extent that there are sufficient funds available to fund such redemptions. In no event shall the Company redeem more than 5.0% of the weighted average shares outstanding during the prior calendar year, and the cash available for redemption will be limited to the proceeds from the sale of shares pursuant to the DRP. Effective March 17, 2013, the redemption price per share shall be as shown below, which is based upon the number of years the stock is held:

Period of Time Held	Redemption Price
At least one year	Lower of $9.25 or the price paid by the stockholder
At least two years	Lower of $9.50 or the price paid by the stockholder
At least three years	Lower of $9.75 or the price paid by the stockholder
At least four years	Lower of $10.28 or the price paid by the stockholder

As the use of the proceeds from the DRP for redemptions is outside the Company’s control, the net proceeds from the DRP are considered to be temporary equity and are presented as common stock subject to redemption on the accompanying consolidated balance sheets. The cumulative proceeds from the DRP, net of any redemptions, will be computed at each reporting date and will be classified as temporary equity on the Company’s consolidated balance sheets. As noted above, the redemption is limited to proceeds from new permanent equity from the sale of shares pursuant to the DRP.

Redemption requests will be honored on or about the last business day of the month following the end of each quarter. Requests for redemption must be received on or prior to the end of the quarter in order for the Company to repurchase the shares as of the end of the following month. Since inception and through December 31, 2015, the Company had redeemed 1,753,700 shares of common stock for approximately $17.3 million at a weighted average price per share of $9.88 pursuant to the SRP. As of December 31, 2015, there were 638,483 shares totaling $6.3 million subject to redemption requests. The Company’s board of directors may choose to amend, suspend, or terminate the SRP upon 30 days' written notice at any time.

Noncontrolling Interests

Noncontrolling interests represent limited partnership interests in the Operating Partnership in which the Company is the general partner. General Partnership units and limited partnership units of the Operating Partnership were issued as part of the initial capitalization of the Operating Partnership, and limited partnership units were issued in conjunction with management's contribution of certain assets, as discussed in Note 1, Organization.

As of December 31, 2015, noncontrolling interests were approximately 3% of total shares outstanding and approximately 3% of weighted average shares outstanding (both measures assuming limited partnership units were converted to common stock). The Company has evaluated the terms of the limited partnership interests in the Operating Partnership and as a result, has classified limited partnership interests issued in the initial capitalization and in conjunction with the contributed assets as noncontrolling interests, which are presented as a component of permanent equity, except as discussed below.

The Company evaluates individual noncontrolling interests for the ability to recognize the noncontrolling interest as permanent equity on the consolidated balance sheets at the time such interests are issued and on a continual basis. Any noncontrolling interest that fails to qualify as permanent equity has been reclassified as temporary equity and adjusted to the greater of (a) the carrying amount, or (b) its redemption value as of the end of the period in which the determination is made.

The Operating Partnership issued 5.5 million limited partnership units to affiliated parties and unaffiliated third parties in exchange for certain properties and 0.1 million limited partnership units to unaffiliated third parties unrelated to property contributions. To the extent the contributors should elect to redeem all or a portion of their Operating Partnership units, pursuant to the terms of the respective contribution agreement, such redemption shall be at a per unit value equivalent to the price at which the contributor acquired its limited partnership units in the respective transaction.

The limited partners of the Operating Partnership, other than those related to the Will Partners REIT, LLC (Will Partners property) contribution, will have the right to cause the general partner of the Operating Partnership, the Company, to redeem their limited partnership units for cash equal to the value of an equivalent number of shares, or, at the Company’s option, purchase their limited partnership units by issuing one share of the Company’s common stock for the original redemption value of each limited partnership unit redeemed. These rights may not be exercised under certain circumstances which could cause the Company to lose its REIT election. There were no redemption requests during the years ended December 31, 2015 and 2014.

The following summarizes the activity for noncontrolling interests recorded as equity for the years ended December 31, 2015, 2014, and 2013:

	Year Ended December 31,
	2015			2014			2013
Beginning balance	$	17,478		$	19,736		$	17,512
Contribution/issuance of noncontrolling interests	7,282			1,504			8,095
Distributions to noncontrolling interests	(3,150		)	(3,050		)	(2,730		)
Allocated distributions to noncontrolling interests subject to redemption	(10		)	(14		)	(49		)
Net loss	(138		)	(698		)	(3,092		)
Other comprehensive loss	(144		)	—			—
Ending balance	$	21,318		$	17,478		$	19,736

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Related Party Transactions

12 Months Ended

Dec. 31, 2015

Related Party Transaction, Due from (to) Related Party [Abstract]

Related Party Transactions

Related Party Transactions

The following table summarizes the related party costs and fees incurred, paid and due to affiliates as of December 31, 2015 and 2014:

	As of December 31, 2014			Year Ended December 31, 2015
	Payable			Incurred			Paid		Payable
Advisor and Property Manager fees
Acquisition fees and expenses	—			35,210		(1)	32,245		2,965
Operating expenses/leasing commissions	202			3,713			1,738		2,177
Asset management fees	1,189			18,753			17,818		2,124
Property management fees	460			7,149			6,411		1,198
Disposition fees (2)	—			640			353		287
Costs advanced by the Advisor	—			53			47		6
Total, net of real estate assets held for sale	1,851			65,518			58,612		8,757
Asset management fees related to real estate held for sale (3)	65			636			657		44
Property management fees related to real estate held for sale (3)	39			473			475		37
Total	$	1,955	(1)	$	66,627		$	59,744	$	8,838

(1)     Includes approximately $3.0 million of acquisition fees and expense reimbursements related to the Restoration Hardware property, as discussed in Note

3, Real Estate, which are also included in the basis of the property.

(2)     The disposition expense represents fees incurred from the sale of the College Park, Will Partners, and LTI properties.

(3)     Represents asset management fees and property management fees for the College Park, Will Partners, and One Century Place properties.

Mortgage Receivable from Affiliate

On October 9, 2015, the Company entered into a mortgage receivable for approximately $26.0 million related to a 127,246 square foot, single-story office building located in Emeryville, CA. The borrower is an affiliated tenant-in-common private program or LLC, each with the Sponsor as the asset manager. The mortgage receivable had a rate of 8% per annum and was funded with proceeds from the Unsecured Credit Facility (July 2015). The mortgage receivable was paid in full on January 15, 2016.

Advisory Agreement

The Company currently does not have nor does it expect to have any employees. The Advisor will be primarily responsible for managing the business affairs and carrying out the directives of the Company’s board of directors. The Company entered into an advisory agreement with the Advisor for the Public Offerings. The Advisory Agreement entitles the Advisor to specified fees and incentives upon the provision of certain services with regard to the Public Offerings and investment of funds in real estate properties, among other services, as well as reimbursement for organizational and offering costs incurred by the Advisor on the Company’s behalf and reimbursement of certain costs and expenses incurred by the Advisor in providing services to the Company.

The Advisory Agreement requires, upon termination of the Public Offerings, that any organizational and offering costs, including sales commissions and dealer manager fees, incurred above 15% of gross equity raised in the Company’s Public Offerings and that any organizational and offering costs not including sales commissions and dealer manager fees, incurred above 3.5% of gross equity raised in the Company’s Public Offerings shall be reimbursed to the Company. Upon termination of the Public Offerings, organizational and offering costs did not exceed the limitations for organizational and offering costs the Advisor is subject to, as discussed in Note 2, Basis of Presentation and Summary of Significant Accounting Policies - Organizational and Offering Costs.

Management Compensation

The following table summarizes the compensation and fees the Company has paid or may pay to the Advisor, the Property Manager, and the Sponsor and other affiliates, including amounts to reimburse costs for providing services.

Type of Compensation (Recipient)	Determination of Amount
Acquisition Fees and Expenses (Advisor)	Under the Advisory Agreement, the Advisor receives acquisition fees equal to 2.5%, and reimbursement for actual acquisition related expenses incurred by the Advisor of up to 0.50% of the contract purchase price, as defined therein, of each property acquired by the Company, and reimbursement for actual acquisition expenses incurred on the Company's behalf, including certain payroll costs for acquisition-related efforts by the Advisor's personnel, as defined in the agreements. In addition, the Company pays acquisition expenses to unaffiliated third parties equal to approximately 0.60% of the purchase price of the Company's properties. The acquisition fee and acquisition expenses paid by the Company shall be reasonable and in no event exceed an amount equal to 6.0% of the contract purchase price, unless approved by a majority of the independent directors.
Disposition Fee (Advisor)	In the event that the Company sells any or all of its properties (or a portion thereof), or all or substantially all of the business or securities of the Company are transferred or otherwise disposed of by way of a merger or other similar transaction, the Advisor will be entitled to receive a disposition fee if the Advisor or an affiliate provides a substantial amount of the services (as determined by a majority of the Company's directors, including a majority of the independent directors) in connection with such transaction. The disposition fee the Advisor or such affiliate shall be entitled to receive at closing will be equal to the lesser of: (1) 3% of the Contract Sales Price, as defined in the Advisory Agreement or (2) 50% of the Competitive Commission, as defined in the Advisory Agreement; provided, however, that in connection with certain types of transactions described further in the Advisory Agreement, the disposition fee shall be subordinated to Invested Capital (as defined in the operating partnership agreement). The disposition fee may be paid in addition to real estate commissions or other commissions paid to non-affiliates, provided that the total real estate commissions or other commissions (including the disposition fee) paid to all persons by the Company or the operating partnership shall not exceed an amount equal to the lesser of (i) 6% of the aggregate Contract Sales Price or (ii) the Competitive Commission.
Asset Management Fee (Advisor)	The Advisor receives an annual asset management fee for managing the Company’s assets equal to 0.75% of the Average Invested Assets, defined as the aggregate carrying value of the assets invested before reserves for depreciation. The fee will be computed based on the average of these values at the end of each month. The asset management fees are earned monthly.
Operating Expenses (Advisor)	The Advisor and its affiliates are entitled to reimbursement, at cost, for actual expenses incurred by them on behalf of the Company in connection with their provision of administrative services, including related personnel costs; provided, however, the Advisor must reimburse the Company for the amount, if any, by which total operating expenses (as defined), including advisory fees, paid during the previous 12 months then ended exceeded the greater of: (i) 2% of the Company’s average invested assets for that 12 months then ended; or (ii) 25% of the Company’s net income, before any additions to reserves for depreciation, bad debts or other expenses connected with the acquisition and disposition of real estate interests and before any gain from the sale of the Company’s assets, for that fiscal year, unless the Company’s board of directors has determined that such excess expenses were justified based on unusual and non-recurring factors. For the years ended December 31, 2015 and 2014, approximately $1.6 million and $1.0 million, respectively, of operating expenses incurred by the Advisor were allocated to the Company in each period. Such costs are allocated using methodologies meant to fairly allocate such costs based upon the related activities and in accordance with the agreement.

Type of Compensation (Recipient)	Determination of Amount
Property Management Fees (Property Manager)	The Property Manager is entitled to receive a fee for its services in managing the Company’s properties up to 3% of the gross monthly revenues from the properties plus reimbursement of the costs of managing the properties. The Property Manager, in its sole and absolute discretion, can waive all or a part of any fee earned. In the event that the Property Manager assists with the development or redevelopment of a property, the Company may pay a separate market-based fee for such services. In the event that the Company contracts directly with a non-affiliated third-party property manager with respect to a particular property, the Company will pay the Property Manager an oversight fee equal to 1% of the gross revenues of the property managed. In no event will the Company pay both a property management fee to the Property Manager and an oversight fee to the Property Manager with respect to a particular property. In addition, the Company may pay the Property Manager or its designees a leasing fee in an amount equal to the fee customarily charged by others rendering similar services in the same geographic area. The Company may also pay the Property Manager or its designees a construction management fee for planning and coordinating the construction of any tenant directed improvements for which the Company is responsible to perform pursuant to lease concessions, including tenant-paid finish-out or improvements. The Property Manager shall also be entitled to a construction management fee of 5% of the cost of improvements.
Subordinated Share of Net Sale Proceeds (Advisor) (1)	Payable to the Advisor in cash upon the sale of a property after the Company's stockholders receive a return of capital plus a 6% cumulative, non-compounded return. The share of net proceeds from the sale of property is 5% if stockholders are paid a return of capital plus 6% to 8% annual cumulative non-compounding return, 10% if stockholders are paid a return of capital plus 8% to 10% annual cumulative non-compounding return, or 15% if stockholders are paid a return of capital plus 10% or more annual cumulative non-compounding return.
Subordinated Incentive Listing Distribution (Advisor) (1)	Payable to the Advisor no earlier than 7 months and no later than 19 months following a listing of the shares on a national securities exchange, based upon the market value of the Company's shares during a period of 30 trading days commencing after the first day of the 6th month, but no later than the last day of the 18th month following a listing, the commencement date of which shall be chosen by the Advisor in its sole discretion, and after the Company's stockholders receive a return of capital plus a 6% cumulative, non-compounded return. The distribution share is 5% if stockholders are paid a return of capital plus 6% to 8% annual cumulative non-compounding return, 10% if stockholders are paid a return of capital plus 8% to 10% annual cumulative non-compounding return, or 15% if stockholders are paid a return of capital plus 10% or more annual cumulative non-compounding return, and is payable in cash, shares of the Company's stock, units of limited partnership interest in the Operating Partnership, or a combination thereof.
Subordinated Distribution Due Upon Termination (Advisor)	Payable to the Advisor (in cash, shares of the Company's stock, units of limited partnership interest in the Operating Partnership, or a combination thereof), 1/3rd within 30 days of the date of involuntary termination of the Advisory Agreement, 1/3rd upon the one year anniversary of such date, and 1/3rd upon the two year anniversary of such date. Calculated based upon appraised value of properties less the fair value of the underlying debt, and plus or minus net current assets or net current liabilities, respectively, and payable after the Company's stockholders receive a return of capital plus a 6% cumulative, non-compounded return. The distribution share is 5% if stockholders are paid a return of capital plus 6% to 8% annual cumulative non-compounding return, 10% if stockholders are paid a return of capital plus 8% to 10% annual cumulative non-compounding return, or 15% if stockholders are paid a return of capital plus 10% or more annual cumulative non-compounding return. Upon a voluntary termination of the Advisory Agreement, the Advisor will not be entitled to receive the Subordinated Distribution Due Upon Termination but instead will be entitled to receive at the time of the applicable liquidity event a distribution equal to the applicable Subordinated Share of Net Sale Proceeds, Subordinated Incentive Listing Distribution, or Subordinated Distribution Due Upon Extraordinary Transaction.
Subordinated Distribution Due Upon Extraordinary Transaction (Advisor) (1)	Payable to the Advisor upon the closing date of an Extraordinary Transaction (as defined in the Operating Partnership Agreement); payable in cash, shares of the Company's stock, units of limited partnership in the Operating Partnership, or a combination thereof after the Company's stockholders receive a return of capital plus a 6% cumulative, non-compounded return. The distribution share is 5% if stockholders are paid a return of capital plus 6% to 8% annual cumulative non-compounding return, 10% if stockholders are paid a return of capital plus 8% to 10% annual cumulative non-compounding return, or 15% if stockholders are paid a return of capital plus 10% or more annual cumulative non-compounding return.

Type of Compensation (Recipient)

Determination of Amount

Sponsor Break-Even Amount (Sponsor)

In the event of a merger of the Advisor into the Company or one of its affiliates in anticipation of listing or a merger with an already-listed entity, any merger consideration paid to the Company's sponsor or its affiliates in excess of unreturned and unreimbursed capital invested by the Company's sponsor and its affiliates into the Company, the Advisor, the Company's dealer manager, or affiliates, relating in any way to the business organization of the Company, the Operating Partnership, or any offering of the Company, shall be subordinated to the return of stockholders' invested capital. Such excess merger consideration shall be paid in stock that may not be traded for one year from the date of receipt, and such stock shall be held in escrow pending the occurrence of certain conditions outlined further in the Operating Partnership Agreement.

(1) The Advisor cannot earn more than one incentive distribution. Any receipt by the Advisor of subordinated share of net sale proceeds (for anything other than a sale of the entire portfolio) will reduce the amount of the subordinated distribution due upon termination, the subordinated incentive listing distribution and the subordinated distribution due upon extraordinary transaction.

Conflicts of Interest

The Sponsor, Advisor, Property Manager and their officers and certain of their key personnel and their respective affiliates currently serve as key personnel, advisors, managers and sponsors or co-sponsors to some or all of 11 other real estate programs affiliated with the Sponsor, including Griffin Capital Essential Asset REIT II, Inc. ("GCEAR II") and Griffin-American Healthcare REIT III, Inc. ("GAHR III"), both of which are publicly-registered, non-traded real estate investment trusts, Griffin-American Healthcare REIT IV, Inc. ("GAHR IV"), a non-traded real estate investment trust in registration as of December 31, 2015, Griffin-Benefit Street Partners BDC Corp. ("GB-BDC"), a non-traded business development company regulated under the 1940 Act, and Griffin Institutional Access Real Estate Fund ("GIREX"), a non-diversified, closed-end management investment company that is operated as an interval fund under the 1940 Act. Because these persons have competing demands on their time and resources, they may have conflicts of interest in allocating their time between the Company’s business and these other activities.

Some of the material conflicts that the Sponsor, Advisor, and Property Manager and their key personnel and their respective affiliates will face are (1) competing demand for time of the Advisor’s executive officers and other key personnel from the Sponsor and other affiliated entities; (2) determining if certain investment opportunities should be recommended to the Company or another program sponsored or co-sponsored by the Sponsor; and (3) influence of the fee structure under the Advisory Agreement and the distribution structure under the Operating Partnership Agreement that could result in actions not necessarily in the long-term best interest of the Company’s stockholders. The board of directors has adopted the Sponsor’s acquisition allocation policy as to the allocation of acquisition opportunities among the Company and GCEAR II, which is based on the following factors:

• the investment objectives of each program;

• the amount of funds available to each program;

• the financial impact of the acquisition on each program, including each program’s earnings and distribution ratios;

• various strategic considerations that may impact the value of the investment to each program;

• the effect of the acquisition on diversification of each program’s investments; and

• the income tax effects of the purchase to each program.

If, after consideration of these factors, the investment opportunity is suitable for the Company and for GCEAR II, then:

• the Company will have priority for investment opportunities of $75 million or greater; and

• GCEAR II will have priority for investment opportunities of $35 million or less, until such time as GCEAR II reaches $500 million in aggregate assets (based on contract purchase price).

In the event all acquisition allocation factors have been exhausted and an investment opportunity remains equally suitable for the Company and GCEAR II, the Sponsor will offer the investment opportunity to the REIT that has had the longest period of time elapse since it was offered an investment opportunity.

If the Sponsor no longer sponsors the Company, then, in the event that an investment opportunity becomes available that is suitable, under all of the factors considered by the Advisor, for both GCEAR II and one or more other entities affiliated with the Sponsor, the Sponsor has agreed to present such investment opportunities to GCEAR II first, prior to presenting such opportunities to any other programs sponsored by or affiliated with the Sponsor. In determining whether or not an investment opportunity is suitable for more than one program, the Advisor, subject to approval by the board of directors, shall examine, among others, the following factors:

• anticipated cash flow of the property to be acquired and the cash requirements of each program;

• effect of the acquisition on diversification of each program’s investments;

• policy of each program relating to leverage of properties;

• income tax effects of the purchase to each program;

• size of the investment; and

• amount of funds available to each program and the length of time such funds have been available for investment.

Economic Dependency

The Company will be dependent on the Advisor for certain services that are essential to the Company, including the identification, evaluation, negotiation, purchase and disposition of properties and other investments, management of the daily operations of the Company’s real estate portfolio, and other general and administrative responsibilities. In the event that the Advisor is unable to provide the services, the Company will be required to obtain such services from other resources.

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Commitments and Contingencies

12 Months Ended

Dec. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Ground Lease Obligations

The Company acquired a property on January 16, 2014 that is subject to a ground lease with an expiration date of December 31, 2095. The Company incurred rent expense of approximately $0.4 million during the years ended December 31, 2015 and 2014, related to the ground lease. As of December 31, 2015, the remaining required payments under the terms of the ground lease are as follows:

	December 31, 2015
2016	$	180
2017	198
2018	198
2019	198
2020	198
Thereafter	34,048
Total	$	35,020

Litigation

From time to time, the Company may become subject to legal proceedings, claims and litigation arising in the ordinary course of business. The Company is not a party to any material legal proceedings, nor is the Company aware of any pending or threatened litigation that would have a material adverse effect on the Company’s business, operating results, cash flows or financial condition should such litigation be resolved unfavorably.

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Declaration of Distributions

12 Months Ended

Dec. 31, 2015

Declaration of Distributions [Abstract]

Declaration of Distributions

Declaration of Distributions

During the quarter ended December 31, 2015, the Company paid distributions in the amount of $0.001901096 per day per share on the outstanding shares of common stock payable to stockholders of record at the close of business on each day during the period from October 1, 2015 through December 31, 2015. Such distributions were paid on a monthly basis, on or about the first day of the month, for the month then-ended.

On December 16, 2015, the Company’s board of directors declared distributions in the amount of $0.001895902 per day per share on the outstanding shares of common stock payable to stockholders of record at the close of business on each day during the period from January 1, 2016 through March 31, 2016. Such distributions payable to each stockholder of record during a month will be paid on such date of the following month as the Company’s Chief Executive Officer may determine.

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Selected Quarterly Financial Data (Unaudited)

12 Months Ended

Dec. 31, 2015

Quarterly Financial Information Disclosure [Abstract]

Selected Quarterly Financial Data (Unaudited)

Selected Quarterly Financial Data (Unaudited)

Presented below is a summary of the unaudited quarterly financial information for the years ended December 31, 2015 and 2014:

	2015
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Total revenue	$	55,213		$	61,563		$	82,849		$	90,470
Net income (loss)	$	11,101		$	(11,655	)	$	4,005		$	12,170
Net income (loss) attributable to common stockholders	$	6,116		$	(21,409	)	$	1,544		$	9,999
Net loss per share	$	0.05		$	(0.15	)	$	0.01		$	0.06
	2014
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Total revenue	$	47,992		$	47,285		$	52,631		$	54,486
Net income (loss)	$	2,740		$	(7,990	)	$	381		$	4,883
Net loss attributable to common stockholders	$	(1,920	)	$	(12,378	)	$	(4,354	)	$	(2	)
Net loss per share	$	(0.03	)	$	(0.10	)	$	(0.03	)	$	(0.01	)

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Subsequent Events

12 Months Ended

Dec. 31, 2015

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

Offering Status

As of March 4, 2016, the Company had issued approximately 9,414,932 shares of the Company’s common stock pursuant to the DRP Offerings for approximately $96.0 million.

Declaration of Distributions

On March 1, 2016, the Company’s board of directors declared distributions in the amount of $0.001895902 per day per share on the outstanding shares of common stock payable to stockholders of record at the close of business on each day during the period from April 1, 2016 through June 30, 2016. Such distributions payable to each stockholder of record during a month will be paid on such date of the following month as the Company’s Chief Executive Officer may determine.

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Schedule III Real Estate and Accumulated Depreciation

12 Months Ended

Dec. 31, 2015

SEC Schedule III, Real Estate and Accumulated Depreciation Disclosure [Abstract]

Schedule III Real Estate and Accumulated Depreciation

GRIFFIN CAPITAL ESSENTIAL ASSET REIT, INC.

SCHEDULE III

REAL ESTATE AND ACCUMULATED DEPRECIATION

(in thousands)

					Initial Cost to Company				Cost  Capitalized Subsequent to Acquisition		Gross Carrying Amount at December 31, 2015										Life on which depreciation in latest income statement is computed
Property	Property Type	ST	Encumbrances		Land		Building and Improve-ments		Building and Improve-ments		Land		Building and Improve-ments		Total		Accumulated Depreciation		Date of Construction	Date of Acquisition
Plainfield	Office/Laboratory	IL	$	19,295	$	3,709	$	27,335	$	2,217	$	3,709	$	29,552	$	33,261	$	8,750	N/A	6/18/2009	5-40 years
Renfro	Warehouse/Distribution	SC	13,500		1,400		18,804		1,390		1,400		20,194		21,594		5,394		N/A	6/18/2009	5-40 years
Emporia Partners	Office/Industrial/Distribution	KS	3,753		274		7,567		—		274		7,567		7,841		1,731		N/A	8/27/2010	5-40 years
ITT	Office	CA	4,600		2,877		4,222		17		2,877		4,239		7,116		1,444		N/A	9/23/2010	5-40 years
Quad/Graphics	Industrial/Office	CO	7,500		1,950		10,236		272		1,950		10,508		12,458		1,931		N/A	12/30/2010	5-40 years
AT&T	Office/ Data Center	WA	26,000		6,770		32,420		461		6,770		32,881		39,651		5,786		N/A	1/31/2012	5-40 years
Westinghouse	Engineering Facility	PA	22,000		2,650		29,096		—		2,650		29,096		31,746		4,022		N/A	3/22/2012	5-40 years
TransDigm	Assembly/Manufacturing	NJ	6,432		3,773		9,030		—		3,773		9,030		12,803		1,505		N/A	5/31/2012	5-40 years
Travelers	Office	CO	9,500		2,600		13,500		468		2,600		13,968		16,568		2,138		N/A	6/29/2012	5-40 years
Zeller	Manufacturing	IL	9,000		2,674		13,229		651		2,674		13,880		16,554		1,597		N/A	11/8/2012	5-40 years
Northrop	Office	OH	10,800		1,300		16,188		—		1,300		16,188		17,488		3,082		N/A	11/13/2012	5-40 years
Health Net	Office	CA	13,500		4,182		18,072		—		4,182		18,072		22,254		3,327		N/A	12/18/2012	5-40 years
Comcast	Office	CO	—		3,146		22,826		174		3,146		23,000		26,146		3,957		N/A	1/11/2013	5-40 years
Boeing	Office	WA	—		3,000		9,000		102		3,000		9,102		12,102		2,732		N/A	2/15/2013	5-40 years
Schlumberger	Office	TX	30,060		2,800		47,752		145		2,800		47,897		50,697		4,612		N/A	5/1/2013	5-40 years
UTC	Office	NC	23,760		1,330		37,858		—		1,330		37,858		39,188		3,987		N/A	5/3/2013	5-40 years
Avnet	Research & Development/Flex Facility	AZ	19,860		1,860		31,481		—		1,860		31,481		33,341		3,230		N/A	5/29/2013	5-40 years
Cigna	Office	AZ	—		8,600		48,102		—		8,600		48,102		56,702		4,922		N/A	6/20/2013	5-40 years
Nokia	Office	IL	—		7,697		21,843		—		7,697		21,843		29,540		1,828		N/A	8/13/2013	5-40 years
Verizon	Office	NJ	26,160		5,300		36,768		1,472		5,300		38,240		43,540		5,082		N/A	10/3/2013	5-40 years
Fox Head	Office	CA	—		3,672		23,230		—		3,672		23,230		26,902		1,792		N/A	10/29/2013	5-40 years
Coca-Cola Refreshments	Office	GA	—		5,000		50,227		40		5,000		50,267		55,267		5,483		N/A	11/5/2013	5-40 years

				Initial Cost to Company		Cost  Capitalized Subsequent to Acquisition	Gross Carrying Amount at December 31, 2015						Life on which depreciation in latest income statement is computed
Property	Property Type	ST	Encumbrances	Land	Building and Improve-ments	Building and Improve-ments	Land	Building and Improve-ments	Total	Accumulated Depreciation	Date of Construction	Date of Acquisition
General Electric	Office	GA	—	5,050	51,396	114	5,050	51,510	56,560	3,832	N/A	11/5/2013	5-40 years
Atlanta Wildwood	Office	GA	—	4,189	23,414	114	4,189	23,528	27,717	3,155	N/A	11/5/2013	5-40 years
Community Insurance	Office	OH	—	1,177	22,323	—	1,177	22,323	23,500	2,013	N/A	11/5/2013	5-40 years
Anthem	Office	OH	—	850	8,892	—	850	8,892	9,742	1,074	N/A	11/5/2013	5-40 years
JPMorgan Chase	Office	OH	—	5,500	39,000	—	5,500	39,000	44,500	3,386	N/A	11/5/2013	5-40 years
IBM	Office	OH	—	4,750	32,769	341	4,750	33,110	37,860	4,153	N/A	11/5/2013	5-40 years
Aetna	Office	TX	—	3,000	12,330	185	3,000	12,515	15,515	1,671	N/A	11/5/2013	5-40 years
CHRISTUS Health	Office	TX	—	1,950	46,922	37	1,950	46,959	48,909	4,738	N/A	11/5/2013	5-40 years
Roush Industries	Office	MI	—	875	11,375	534	875	11,909	12,784	2,326	N/A	11/5/2013	5-40 years
Wells Fargo	Office	WI	—	3,100	26,348	359	3,100	26,707	29,807	10,430	N/A	11/5/2013	5-40 years
Shire Pharmaceuticals	Office	PA	—	2,925	18,935	25	2,925	18,960	21,885	3,669	N/A	11/5/2013	5-40 years
United HealthCare	Office	MO	—	2,920	23,510	44	2,920	23,554	26,474	3,576	N/A	11/5/2013	5-40 years
Northpointe Corporate Center II	Office	WA	—	1,109	6,066	4,575	1,109	10,641	11,750	784	N/A	11/5/2013	5-40 years
Comcast (Northpointe Corporate Center I)	Office	WA	—	2,292	16,930	—	2,292	16,930	19,222	2,189	N/A	11/5/2013	5-40 years
Farmers	Office	KS	—	2,750	17,106	51	2,750	17,157	19,907	1,758	N/A	12/27/2013	5-40 years
Caterpillar	Industrial	IL	—	6,000	46,511	—	6,000	46,511	52,511	5,333	N/A	1/7/2014	5-40 years
DigitalGlobe	Office	CO	—	8,600	83,400	—	8,600	83,400	92,000	6,285	N/A	1/14/2014	5-40 years
Waste Management	Office	AZ	—	—	16,515	10	—	16,525	16,525	1,511	N/A	1/16/2014	5-40 years
BT Infonet	Office	CA	—	9,800	41,483	—	9,800	41,483	51,283	3,394	N/A	2/27/2014	5-40 years
Wyndham Worldwide	Office	NJ	—	6,200	91,153	—	6,200	91,153	97,353	4,860	N/A	4/23/2014	5-40 years
Ace Hardware	Office	IL	23,294	6,900	33,945	—	6,900	33,945	40,845	2,195	N/A	4/24/2014	5-40 years
Equifax I	Office	MO	—	1,850	12,709	—	1,850	12,709	14,559	1,119	N/A	5/20/2014	5-40 years
American Express	Office	AZ	—	15,000	45,893	—	15,000	45,893	60,893	5,262	N/A	5/22/2014	5-40 years
SoftBank	Office	CA	—	22,789	68,950	—	22,789	68,950	91,739	11,744	N/A	5/28/2014	5-40 years
Vanguard	Office	NC	—	2,230	31,062	—	2,230	31,062	33,292	1,984	N/A	6/19/2014	5-40 years

						Initial Cost to Company				Cost  Capitalized Subsequent to Acquisition		Gross Carrying Amount at December 31, 2015										Life on which depreciation in latest income statement is computed
Property	Property Type	ST	Encumbrances			Land		Building and Improve-ments		Building and Improve-ments		Land		Building and Improve-ments		Total		Accumulated Depreciation		Date of Construction	Date of Acquisition
Parallon	Office	FL	—			1,000		16,772		—		1,000		16,772		17,772		1,054		N/A	6/25/2014	5-40 years
TW Telecom	Office	CO	21,213			11,097		35,817		583		11,097		36,400		47,497		2,329		N/A	8/1/2014	5-40 years
Equifax II	Office	MO	—			2,200		12,755		—		2,200		12,755		14,955		775		N/A	10/1/2014	5-40 years
Mason I	Office	OH	—			4,777		18,489		—		4,777		18,489		23,266		532		N/A	11/7/2014	5-40 years
Wells Fargo	Office	NC	—			2,150		40,806		—		2,150		40,806		42,956		1,683		N/A	12/15/2014	5-40 years
GE Aviation	Office	OH	—			4,400		61,681		—		4,400		61,681		66,081		2,730		N/A	2/19/2015	5-40 years
Westgate III	Office	TX	—			3,209		75,937		—		3,209		75,937		79,146		2,112		N/A	4/1/2015	5-40 years
Lisle	Office	IL	—			2,788		16,200		33		2,788		16,233		19,021		626		N/A	6/10/2015	5-40 years
Bloomingdale	Office	IL	—			1,178		5,182		—		1,178		5,182		6,360		145		N/A	6/10/2015	5-40 years
Columbia	Office	MD	—			6,989		46,875		—		6,989		46,875		53,864		1,166		N/A	6/10/2015	5-40 years
Denver	Office	CO	—			9,948		23,888		—		9,948		23,888		33,836		682		N/A	6/10/2015	5-40 years
Columbus	Office	OH	—			2,943		22,651		—		2,943		22,651		25,594		833		N/A	6/10/2015	5-40 years
Miramar	Office	FL	—			4,488		19,979		—		4,488		19,979		24,467		643		N/A	6/10/2015	5-40 years
Irving Carpenter	Office	TX	—			1,842		22,052		1,995		1,842		24,047		25,889		294		N/A	6/10/2015	5-40 years
Frisco	Office	TX	—			8,239		51,395		1,104		8,239		52,499		60,738		1,300		N/A	6/10/2015	5-40 years
Houston Westway II	Office	TX	—			3,961		78,668		—		3,961		78,668		82,629		2,363		N/A	6/10/2015	5-40 years
Houston Westway I	Office	TX	—			6,540		30,703		—		6,540		30,703		37,243		1,068		N/A	6/10/2015	5-40 years
Atlanta Perimeter	Office	GA	—			8,607		96,718		278		8,607		96,996		105,603		3,394		N/A	6/10/2015	5-40 years
Herndon	Office	VA	—			9,666		74,098		—		9,666		74,098		83,764		1,987		N/A	6/10/2015	5-40 years
Deerfield	Office	IL	—			4,339		37,298		—		4,339		37,298		41,637		1,164		N/A	6/10/2015	5-40 years
DreamWorks	Office	CA	—			26,387		190,805		—		26,387		190,805		217,192		2,640		N/A	7/21/2015	5-40 years
Highway 94	Office	MO	18,968			5,540		28,230		—		5,540		28,230		33,770		202		N/A	11/6/2015	5-40 years
DynCorp	Office	TX	11,162			1,952		15,540		—		1,952		15,540		17,492		57		N/A	12/11/2015	5-40 years
Mercedes-Benz	Office	TX	18,945			2,330		26,376		—		2,330		26,376		28,706		94		N/A	12/11/2015	5-40 years
Samsonite	Office	FL	24,561			5,040		42,490		—		5,040		42,490		47,530		88		N/A	12/11/2015	5-40 years
Total Operating Properties			$	363,863		$	339,980	$	2,449,128	$	17,791	$	339,980	$	2,466,919	$	2,806,899	$	200,734
Restoration Hardware	Industrial	CA	—			15,463		—		75,712		15,463		75,712		91,175		1,314		8/15/2015	6/20/2014	5-40 years
Total All Properties			$	363,863	(1)	$	355,443	$	2,449,128	$	93,503	$	355,443	$	2,542,631	$	2,898,074	$	202,048

(1) Amount does not include the net loan valuation premium of $0.8 millionrelated to the debt assumed in the TransDigm, Ace Hardware, Highway 94, and Samsonite property acquisitions, the Term Loan (July 2015) of $640.0 million, and the Revolver Loan (July 2015) of approximately $481.7 million.

	Activity for the years ended December 31,
	2015			2014			2013
Real estate facilities
Balance at beginning of year	$	1,823,895		$	1,175,423		$	328,342
Acquisitions	1,087,153			712,036			854,218
Improvements	7,381			2,826			256
Construction-in-progress	45,067			35,831			7
Real estate assets held for sale	—			(91,074		)	(7,400		)
Write off of tenant origination and absorption costs	—			(4,762		)	—
Sale of real estate assets	(65,422		)	(6,385		)	—
Balance at end of year	$	2,898,074		$	1,823,895		$	1,175,423
Accumulated depreciation
Balance at beginning of year	$	102,883		$	42,806		$	18,898
Depreciation expense	112,748			72,907			24,191
Less: Non-real estate assets depreciation expense	(328		)	(170		)	—
Less: Real estate assets held for sale depreciation expense	(2,265		)	(7,520		)	(283		)
Less: Write off of tenant origination and absorption costs amortization expense	—			(4,762		)	—
Less: Sale of real estate assets depreciation expense	(10,990		)	(378		)	—
Balance at end of year	$	202,048		$	102,883		$	42,806
Real estate facilities, net	$	2,696,026		$	1,721,012		$	1,132,617

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Basis of Presentation and Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2015

Accounting Policies [Abstract]

Use of Estimates

Use of Estimates

The preparation of the consolidated financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could materially differ from those estimates.

Change in Consolidated Financial Statements Presentation

Change in Consolidated Financial Statements Presentation

Certain amounts in the Company's prior period consolidated financial statements have been reclassified to conform to the current period presentation. Based on certain criteria discussed below, the Company classified an office property as held for sale as of December 31, 2015. As a result, certain assets and liabilities are presented as held for sale on the consolidated balance sheets for all periods presented.

Cash and Cash Equivalents

Cash and Cash Equivalents

The Company considers all short-term, highly liquid investments that are readily convertible to cash with a maturity of three months or less at the time of purchase to be cash equivalents. Cash equivalents may include cash and short-term investments. Short-term investments are stated at cost, which approximates fair value. There were no restrictions on the use of the Company’s operating cash balance as of December 31, 2015 and 2014.

The Company maintains cash accounts with major financial institutions. The cash balances consist of business checking accounts and money market accounts. These accounts are insured by the Federal Deposit Insurance Corporation up to $250,000 at each institution. At times, the balances in these accounts may exceed the insured amounts. The Company considers balances in excess of the insured amounts to potentially be a concentration of credit risk. However, the Company has not experienced any losses with respect to cash balances in excess of government-provided insurance and does not anticipate any losses in the future.

Restricted Cash

Restricted Cash

In conjunction with the contribution of certain assets, as required by certain lease provisions or certain lenders in conjunction with an acquisition or debt financing, or credits received by the seller of certain assets, the Company assumed or funded reserves for specific property improvements and deferred maintenance, rent abatement, re-leasing costs, and taxes and insurance (see Note 3, Real Estate).

Real Estate

Real Estate

Purchase Price Allocation

The Company applies the provisions in ASC 805-10, Business Combinations, to account for the acquisition of real estate, or real estate related assets, in which a lease, or other contract, is in place representing an active revenue stream, as a business combination. In accordance with the provisions of ASC 805-10, the Company recognizes the assets acquired, the liabilities assumed and any noncontrolling interest in the acquired entity at their fair values as of the acquisition date, on an “as if vacant” basis. Further, the Company recognizes the fair value of assets acquired, liabilities assumed and any noncontrolling interest in acquisitions of less than a100%interest when the acquisition constitutes a change in control of the acquired entity. The accounting provisions have also established that acquisition-related costs and restructuring costs are considered separate and not a component of a business combination and, therefore, are expensed as incurred. Acquisition-related costs for the years ended December 31, 2015, 2014, and 2013 totaled $35.0 million, $28.6 million, and $29.5 million, respectively. For properties acquired in a sale-leaseback transaction or part of a development project, acquisition fees and acquisition expenses are included as part of the acquisition price.

Acquired in-place leases are valued as above-market or below-market as of the date of acquisition. The valuation is measured based on the present value (using an interest rate, which reflects the risks associated with the leases acquired) of the difference between (a) the contractual amounts to be paid pursuant to the in-place leases and (b) management’s estimate of fair market lease rates for the corresponding in-place leases over a period equal to the remaining non-cancelable term of the lease for above-market leases, taking into consideration below-market extension options for below-market leases. In addition, renewal options are considered and will be included in the valuation of in-place leases if (1) it is likely that the tenant will exercise the option, and (2) the renewal rent is considered to be sufficiently below a fair market rental rate at the time of renewal. The above-market and below-market lease values are capitalized as intangible lease assets or liabilities and amortized as an adjustment to rental income over the remaining terms of the respective leases.

The aggregate fair value of in-place leases includes direct costs associated with obtaining a new tenant, opportunity costs associated with lost rentals, which are avoided by acquiring an in-place lease, and tenant relationships. Direct costs associated with obtaining a new tenant include commissions, tenant improvements, and other direct costs and are estimated using methods similar to those used in independent appraisals and management’s consideration of current market costs to execute a similar lease. These direct costs are considered intangible lease assets and are included with real estate assets on the consolidated balance sheets. The intangible lease assets are amortized to expense over the remaining terms of the respective leases. The value of opportunity costs is calculated using the contractual amounts to be paid, including real estate taxes, insurance, and other operating expenses, pursuant to the in-place leases over a market lease-up period for a similar lease. Customer relationships are valued based on management’s evaluation of certain characteristics of each tenant’s lease and the Company’s overall relationship with that respective tenant. Characteristics management will consider in allocating these values include the nature and extent of the Company’s existing business relationships with tenants, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals (including those existing under the terms of the lease agreement), among other factors. These intangibles will be included in intangible lease assets on the consolidated balance sheets and are amortized to expense over the remaining term of the respective leases.

The determination of the fair values of the assets and liabilities acquired requires the use of significant assumptions about current market rental rates, rental growth rates, discount rates and other variables.

Depreciation and Amortization

Depreciation and Amortization

The purchase price of real estate acquired and costs related to development, construction, and property improvements are capitalized. Repairs and maintenance costs include all costs that do not extend the useful life of the real estate asset and are expensed as incurred. The Company considers the period of future benefit of an asset to determine the appropriate useful life. The Company anticipates the estimated useful lives of its assets by class to be generally as follows:

Buildings	25-40 years
Building Improvements	5-20 years
Land Improvements	15-25 years
Tenant Improvements	Shorter of estimated useful life or remaining contractual lease term
Tenant origination and absorption cost	Remaining contractual lease term
In-place lease valuation	Remaining contractual lease term with consideration as to below-market extension options for below-market leases

Assets Held for Sale

Assets Held for Sale

The Company accounts for properties held for sale in accordance with ASC Topic 360, Property, Plant, and Equipment, ("ASC Topic 360"), which addresses financial accounting and reporting for the impairment or disposal of long-lived assets and Accounting Standards Update ("ASU") No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity ("ASU No. 2014-08"). Under ASU No. 2014-08, a discontinued operation is (i) a component of an entity or group of components that has been disposed of by sale, that has been disposed of other than by sale, or that is classified as held for sale that represents a strategic shift that has or will have a major effect on an entity's operations and financial results or (ii) an acquired business or nonprofit activity that is classified as held for sale on the date of the acquisition.

In accordance with ASC 205, a component of an entity or a group of components of an entity, or a business or nonprofit activity (the entity to be sold), shall be classified as held for sale in the period in which all of the required criteria are met.

In accordance with ASC Topic 360, upon being classified as held for sale, a property is carried at the lower of (i) its carrying amount or (ii) fair value less costs to sell. In addition, a property being held for sale ceases to be depreciated. As of December 31, 2015, one property owned by the Company met the criteria to be classified as held for sale and was included in continuing operations in the consolidated statements of operations based on the Company's early adoption of ASU No. 2014-08, as it did not meet the prerequisite requirements to be classified as discontinued operations. See Note 3, Real Estate.

Impairment of Real Estate and Related Intangible Assets and Liabilities

Impairment of Real Estate and Related Intangible Assets

The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of real estate and related intangible assets may not be recoverable. When indicators of potential impairment are present that indicate that the carrying amounts of real estate and related intangible assets may not be recoverable, management assesses whether the carrying value of the assets will be recovered through the future undiscounted operating cash flows expected from the use of the assets and the eventual disposition. If, based on this analysis, the Company does not believe that it will be able to recover the carrying value of the asset, the Company will record an impairment charge to the extent the carrying value exceeds the net present value of the estimated future cash flows of the asset.

Projections of expected future undiscounted cash flows require management to estimate future market rental income amounts subsequent to the expiration of current lease agreements, property operating expenses, discount rates, the number of months it takes to re-lease the property and the number of years the property is held for investment.

Intangible Assets and Liabilities Arising from In-Place Leases Where the Company is the Lessee

Intangible Assets and Liabilities Arising from In-Place Leases Where the Company is the Lessee

In-place ground leases where the Company is the lessee may have value associated with effective contractual rental rates that are above or below market rates. Such values are calculated based on the present value (using a discount rate that reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place lease and (ii) management's estimate of fair market lease rates for the corresponding in-place lease, measured over a period equal to the remaining terms of the lease. The capitalized above-market and below-market in-place lease values are recorded as intangible lease liabilities and assets, respectively, and are amortized as an adjustment to property operating expense over the remaining term of the respective lease.

The Operating Partnership, through a single purpose entity, assumed a ground lease with the acquisition of the Waste Management property on January 16, 2014. The ground lease has a remaining term of 80 years, expiring on December 31, 2095.

Investments

Investments

ASC 810-10, Consolidation, provides a framework for identifying variable interest entities (“VIEs”) and determining when a company should include the assets, liabilities, noncontrolling interests, and results of activities of the VIE in its consolidated financial statements. In general, a VIE is an entity or other legal structure used to conduct activities or hold assets that either (1) has an insufficient amount of equity to carry out its principal activities without additional subordinated financial support, (2) has a group of equity owners that are unable to make significant decisions about its activities, or (3) has a group of equity owners that do not have the obligation to absorb losses or the right to receive returns generated by its operations. Generally, a VIE should be consolidated if a party with an ownership, contractual, or other financial interest in the VIE (a variable interest holder) has the power to direct the VIE’s most significant activities and the obligation to absorb losses or right to receive benefits of the VIE that could be significant to the VIE. A variable interest holder that consolidates the VIE is called the primary beneficiary. Upon consolidation, the primary beneficiary generally must record all of the VIE’s assets, liabilities, and noncontrolling interest at fair value and subsequently account for the VIE as if it were consolidated based on majority voting interest. If the variable interest holder is not the primary beneficiary, the interest in the VIE is recorded under the equity method of accounting. See Note 4, Investments.    

Revenue Recognition

Revenue Recognition

Leases associated with the acquisition and contribution of certain real estate assets (see Note 3, Real Estate), have net minimum rent payment increases during the term of the lease and are recorded to rental revenue on a straight-line basis, commencing as of the contribution or acquisition date. If a lease provides for contingent rental income, the Company will defer the recognition of contingent rental income, such as percentage rents, until the specific target that triggers the contingent rental income is achieved.

During the years ended December 31, 2015, 2014, and 2013, the Company recognized deferred rent from tenants of $13.8 million, $11.6 million, and $3.5 million, respectively. As of December 31, 2015 and 2014, the cumulative deferred rent balance for assets not held for sale was $26.4 million and $15.6 million, respectively.

Tenant reimbursement revenue, which is comprised of additional amounts collected from tenants for the recovery of certain operating expenses, including repair and maintenance, property taxes and insurance, and capital expenditures, to the extent allowed pursuant to the lease (collectively "Recoverable Expenses"), is recognized as revenue when the additional rent is due. Recoverable Expenses to be reimbursed by a tenant are determined based on the Company's estimate of the property's operating expenses for the year, pro rated based on leased square footage of the property, and are collected in equal installments as additional rent from the tenant, pursuant to the terms of the lease. At the end of the calendar year, the Company reconciles the amount of additional rent paid by the tenant during the year to the actual amount of Recoverable Expenses incurred by the Company for the same period. The difference, if any, is either charged or credited to the tenant pursuant to the provisions of the lease. In certain instances, the lease may restrict the amount the Company can recover from the tenant such as a cap on certain or all property operating expenses. As of December 31, 2015, the Company estimated that approximately $2.3 million, net, was over collected from tenants throughout the year, and as a result, the Company recorded a liability to reflect the net over collections which will be refunded to the tenants either by a credit to contractual rent payments or as a disbursement from operating cash flow.

Organizational and Offering Costs

Organizational and Offering Costs

Organizational and offering costs of the Primary Public Offerings are paid either by the Company or the Sponsor, on behalf of the Advisor, for the Company, which were reimbursed from the proceeds of the Public Offerings at the estimated rate. Organizational and offering costs consist of all expenses (other than sales commissions and dealer manager fees) paid by the Company in connection with the Public Offerings, including legal, accounting, printing, mailing and filing fees, charges from the escrow holder and other accountable offering expenses, including, but not limited to, (i) amounts to reimburse the Advisor for all marketing-related costs and expenses, such as salaries and direct expenses of employees of the Advisor and its affiliates in connection with registering and marketing the Company’s shares; (ii) technology costs associated with the offering of the Company’s shares; (iii) costs of conducting training and education meetings; (iv) costs of attending seminars conducted by participating broker-dealers; and (v) payment or reimbursement of bona fide due diligence expenses.

Pursuant to the Advisory Agreement, the Company was obligated to reimburse the Advisor for organizational and offering expenses incurred in connection with the Primary Public Offerings in an amount not to exceed 3.5% of gross offering proceeds of the terminated or completed Primary Public Offerings for issuer costs (excluding sales commissions and dealer manager fees). In addition, pursuant to the Advisory Agreement, organization and offering expenses (including sales commissions and dealer manager fees and non-accountable due diligence expense allowance but excluding acquisition fees and expenses) were subject to a limitation of 15% of gross offering proceeds of the terminated or completed Public Offerings. If the organization and offering expenses exceeded such limits discussed above, within 60 days after the end of the month in which the Public Offerings terminated or were completed, the Advisor would have been obligated to reimburse the Company for any excess amounts. As long as the Company is subject to the Statement of Policy Regarding Real Estate Investment Trusts published by the North American Securities Administrators Association (“NASAA REIT Guidelines”), such limitations discussed above will also apply to any future public offerings.

Deferred Financing Costs

Deferred Financing Costs

Deferred financing costs represent commitment fees, loan fees, and other fees associated with obtaining financing. These costs are amortized to, and included as a component of, interest expense over the terms of the respective financing agreements.

Other Assets

Other Assets

Other assets consist primarily of tenant and non-tenant receivables, prepaid expenses, and deferred leasing commissions and other leasing costs ("Deferred Leasing Costs"), net of amortization. Non-tenant receivables primarily consist of a $4.9 million and a $2.9 million termination fee, as a result of the lease terminations with World Kitchen, LLC, the former tenant at the Will Partners property, on January 24, 2014, and with Wells Fargo Bank, N.A., the former tenant at the Wells Fargo property, on December 31, 2015, respectively. Prepaid expenses, which are capitalized as other assets, will be expensed over the corresponding period. Leasing commissions for new, renewal, or expansion leases are amortized using the straight-line method over the term of the related lease. Amortization of Deferred Leasing Costs is included in depreciation and amortization in the Company's accompanying consolidated statements of operations.

Noncontrolling Interests

Noncontrolling Interests

Due to the Company’s control through the general partner interest in the Operating Partnership and the limited rights of the limited partners, the Operating Partnership, including its wholly-owned subsidiaries, is consolidated with the Company and the limited partners’ interests are reflected as noncontrolling interests on the accompanying consolidated balance sheets.

The Company reports noncontrolling interests in subsidiaries within equity in the consolidated financial statements, but separate from total stockholders’ equity. Also, any acquisitions or dispositions of noncontrolling interests that do not result in a change of control are accounted for as equity transactions. Further, the Company recognizes a gain or loss in net income (loss) when a subsidiary is deconsolidated upon a change in control. Net income (loss) allocated to noncontrolling interests is shown as an adjustment to net income (loss) attributable to common stockholders. Any future purchase or sale of an interest in an entity that results in a change of control may have a material impact on the financial statements, as the interest in the entity will be recognized at fair value with gains and losses included in net income (loss).

If noncontrolling interests are determined to be redeemable, they are classified as temporary equity and reported at their redemption value as of the balance sheet date. Since redeemable noncontrolling interests are carried at the redemption amount, net income (loss) and distributions are not allocated to redeemable noncontrolling interests. Distributions to redeemable noncontrolling interest holders are allocated between common stockholders and noncontrolling interests based on their respective weighted-average ownership percentage of the Operating Partnership.

Share-Based Compensation

Share-Based Compensation

The Company has adopted an Employee and Director Long-Term Incentive Plan (the “Plan”) pursuant to which the Company may issue stock-based awards to its directors and full-time employees (should the Company ever have employees), executive officers and full-time employees of the Advisor and its affiliate entities that provide services to the Company, and certain consultants who provide significant services to the Company. The term of the Plan is 10 years and the total number of shares of common stock reserved for issuance under the Plan is 10% of the outstanding shares of stock at any time, not to exceed 10,000,000 shares in the aggregate. Awards granted under the Plan may consist of stock options, restricted stock, stock appreciation rights and other equity-based awards. The stock-based payment will be measured at fair value and recognized as compensation expense over the vesting period.

On March 3, 2014, the compensation committee of the board of directors authorized the issuance of 5,000 shares of restricted stock to each of the Company's independent directors. These restricted shares were immediately vested upon issuance. In addition, the compensation committee authorized the future issuance of 1,000 shares of restricted stock to each of the Company's independent directors for each 12-consecutive-month period during which each independent director continuously remains a director for the Company. The future shares granted will vest over a three year period, or will immediately vest upon a change in control of the Company. Upon re-election of each independent director at the June 12, 2014 annual stockholders' meeting, the Company measured and began recognizing director compensation expense for the 1,000 shares of restricted stock granted, subject to the vesting period. One-third of the shares of restricted stock, or 333 shares, for each of the Company's independent directors, vested during the year ended December 31, 2015. The fair value of both issuances was estimated at $10.28 per share, the then most recent price paid to acquire a share of the Company's common stock. All issuances of restricted stock are entitled to dividends upon vesting of the shares.

Upon re-election of each independent director at the June 16, 2015 annual stockholders' meeting, the Company granted 1,000 shares of restricted common stock to each of the independent directors. The fair value of such issuance was estimated at $10.40 per share, the then most recent price paid to acquire a share of the Company's common stock related to the 2014 DRP Offering. Immediately upon granting the restricted common shares, the Company measured and began recognizing director compensation expense, subject to the same vesting period discussed above.

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities

FASB ASC Topic 815: Derivatives and Hedging ("ASC 815"), provides the disclosure requirements for derivatives and hedging activities with the intent to provide users of financial statements with an enhanced understanding of: (a) how and why an entity uses derivative instruments, (b) how the entity accounts for derivative instruments and related hedged items, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. Further, qualitative disclosures are required that explain the Company’s objectives and strategies for using derivatives, as well as quantitative disclosures about the fair value of gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative instruments.

As required by ASC 815, the Company recorded all derivatives on the consolidated balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, and whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain risks, even though hedge accounting does not apply or the Company elects not to apply hedge accounting.

Fair Value Measurements

Fair Value Measurements

The fair value of financial and nonfinancial assets and liabilities is based on a fair value hierarchy established by the FASB that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described as follows:

• Level 1. Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets;

• Level 2. Inputs to the valuation methodology include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

• Level 3. Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

See Note 7, Fair Value Measurements.

Income Taxes

Income Taxes

The Company elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”). To qualify as a REIT, the Company must meet certain organizational and operational requirements. The Company intends to adhere to these requirements and maintain its REIT status for the current year and subsequent years. As a REIT, the Company generally will not be subject to federal income taxes on taxable income that is distributed to stockholders. However, the Company may be subject to certain state and local taxes on its income and property, and federal income and excise taxes on its undistributed taxable income, if any. If the Company fails to qualify as a REIT in any taxable year, the Company will then be subject to federal income taxes on the taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year during which qualification is lost unless the IRS grants the Company relief under certain statutory provisions. Such an event could materially adversely affect net income and net cash available for distribution to stockholders. As of December 31, 2015, the Company satisfied the REIT requirements and distributed all of its taxable income.

Pursuant to the Code, the Company has elected to treat its corporate subsidiary as a taxable REIT subsidiary (“TRS”). In general, the TRS may perform non-customary services for the Company’s tenants and may engage in any real estate or non real estate-related business. The TRS will be subject to corporate federal and state income tax.

Per Share Data

Per Share Data

The Company reports earnings per share for the period as (1) basic earnings per share computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding during the period, and (2) diluted earnings per share computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding, including common stock equivalents. As of December 31, 2015 and 2014, there were no common stock equivalents that would have a dilutive effect on earnings (loss) per share for common stockholders.

Distributions declared and paid per common share assume each share was issued and outstanding each day during the three months ended December 31, 2015. Distributions declared per common share were based on daily declaration and record dates selected by the Company’s board of directors of $0.001901096 per day per share on the outstanding shares of common stock.

Segment Information

Segment Information

ASC Topic 280, Segment Reporting, establishes standards for reporting financial and descriptive information about a public entity’s reportable segments. The Company internally evaluates all of the properties and interests therein as one reportable segment.

Unaudited Data

Unaudited Data

Any references to the number of buildings, square footage, number of leases, occupancy, and any amounts derived from these values in the notes to the consolidated financial statements are unaudited and outside the scope of the Company's independent registered public accounting firm's audit of its consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board.

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements

In February 2016, the FASB issued ASU 2016-02, Leases. ASU 2016-02 amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. ASU 2016-02 will be effective beginning in the first quarter of 2019. Early adoption of ASU 2016-02 as of its issuance is permitted. The new leases standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. The Company is currently evaluating the impact of adopting the new leases standard on the consolidated financial statements.

In September 2015, the FASB issued ASU No. 2015-16, Simplifying the Accounting for Measurement Period Adjustments (“ASU No. 2015-16”). In a business combination, ASU No. 2015-16 requires an acquirer to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The acquirer is required to disclose, by financial statement line item, the nature and amount for the adjustments and the current period income statement impact related to prior periods. The amendments in this ASU are effective for fiscal years beginning December 15, 2016 and interim periods beginning after December 15, 2017. Early adoption is permitted. The Company elected to adopt ASU No. 2015-16 early, beginning with the quarter ended September 30, 2015. There was no significant impact to the Company's consolidated financial statements or notes to theconsolidated financial statements as a result of early adoption.

In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30) (“ASU 2015-03”) to amend the accounting guidance for the presentation of debt issuance costs. The standard requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. ASU 2015-03 is effective for public business entities for fiscal years beginning after December 15, 2015 and retrospective application is required. Early adoption of the guidance is permitted. The Company does not expect the adoption of ASU No. 2015-03 to have a significant impact on its financial statements.

In February 2015, the FASB issued ASU No. 2015-02, Consolidation: Amendments to the Consolidation Analysis ("ASU No. 2015-02"), which amended the existing accounting standards for consolidation under both the variable interest model and the voting model. Under ASU No. 2015-02, companies will need to re-evaluate whether an entity meets the criteria to be considered a VIE, whether companies still meet the definition of primary beneficiaries, and whether an entity needs to be consolidated under the voting model. ASU No. 2015-02 may be applied using a modified retrospective approach or retrospectively, and is effective for reporting periods beginning after December 15, 2015. Early adoption is permitted. The Company does not expect the adoption of ASU No. 2015-02 to have a significant impact on its financial statements.

In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements (Subtopic 205-40), Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU No. 2014-15”). The amendments in ASU No. 2014-15 require management to evaluate, for each annual and interim reporting period, whether there are conditions or events, considered in the aggregate, that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or are available to be issued when applicable) and, if so, provide related disclosures. ASU No. 2014-15 is effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Early adoption is permitted for annual or interim reporting periods for which the financial statements have not previously been issued. The Company does not expect the adoption of ASU No. 2014-15 to have a significant impact on its financial statements.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU No. 2014-09”). ASU No. 2014-09 replaces substantially all industry-specific revenue recognition requirements and converges areas under this topic with International Financial Reporting Standards. ASU No. 2014-09 implements a five-step process for customer contract revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards. ASU No. 2014-09 also requires enhanced disclosures regarding the nature, amount, timing, and uncertainty of revenues and cash flows from contracts with customers. Other major provisions in ASU No. 2014-09 include capitalizing and amortizing certain contract costs, ensuring the time value of money is considered in the applicable transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. ASU No. 2014-09 was originally effective for reporting periods beginning after December 31, 2016 (for public entities). On April 1, 2015, the FASB voted to defer the effective date of ASU No. 2014-09 by one year, to annual reporting periods beginning after December 15, 2017. On July 9, 2015, the FASB affirmed its proposal to defer the effective date to annual reporting periods beginning after December 15, 2017, although entities may elect to adopt the standard as of the original effective date. The Company is currently evaluating the potential impact of the pending adoption of this new guidance on its consolidated financial statements.

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Basis of Presentation and Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2015

Accounting Policies [Abstract]

Schedule of estimated useful lives of assets

The Company anticipates the estimated useful lives of its assets by class to be generally as follows:

Buildings	25-40 years
Building Improvements	5-20 years
Land Improvements	15-25 years
Tenant Improvements	Shorter of estimated useful life or remaining contractual lease term
Tenant origination and absorption cost	Remaining contractual lease term
In-place lease valuation	Remaining contractual lease term with consideration as to below-market extension options for below-market leases

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Real Estate (Tables)

12 Months Ended

Dec. 31, 2015

Real Estate [Abstract]

Summary of purchase price allocation

A summary of the fair value of the assets and liabilities acquired and assumed through the SOR Merger in exchange for approximately 41.8 million shares of the Company's stock is shown in the table below:

Cash assumed	$	8,557
Land	71,529
Building and improvements	436,350
Tenant origination and absorption cost	89,357
Above market leases	16,860
Other assets	2,148
Total assets	$	624,801
Unsecured debt (1)	$	173,000
Below market leases	6,996
Accounts payable and other liabilities	11,138
Total liabilities	191,134
Equity consideration for SOR Merger	433,667
Total liabilities and equity	$	624,801

(1) The unsecured debt was terminated simultaneously with the closing of the SOR Merger, and repaid with borrowings from the Company's Unsecured credit facility (May 2014).

The following summarizes the purchase price allocation of the 2015 acquisitions and SOR Merger:

Property	Land		Building and improvements		Tenant origination and absorption cost		In-place lease valuation - above/(below) market			Debt discount/(premium)			Total
GE Aviation	$	4,400	$	52,211	$	9,470	$	(81	)	$	—		$	66,000
Westgate III	3,209		60,852		15,085		(2,146		)	—			77,000
DreamWorks	26,387		148,163		42,642		(2,192		)	—			215,000
Highway 94 (1)	5,540		21,300		6,930		(4,080		)	2,250			31,940
DynCorp (1)	1,952		13,546		1,994		(842		)	—			16,650
Mercedes-Benz (1)	2,330		23,424		2,952		294			—			29,000
Samsonite (1)	5,040		37,152		5,338		1,971			(1,501		)	48,000
Total acquisitions	$	48,858	$	356,648	$	84,411	$	(7,076	)	$	749		$	483,590
Lisle	2,788		11,209		4,991		512			—			19,500
Bloomingdale	1,178		4,689		493		1,090			—			7,450
Columbia	6,989		42,690		4,185		4,266			—			58,130
Denver	9,948		22,714		1,174		1,164			—			35,000
Columbus	2,943		14,896		7,755		2,006			—			27,600
Miramar	4,488		18,211		1,768		133			—			24,600
Irving Carpenter	1,842		19,479		2,573		(394		)	—			23,500
Frisco	8,239		47,296		4,099		(384		)	—			59,250
Houston Westway II	3,961		67,484		11,184		(129		)	—			82,500
Houston Westway I	6,540		27,765		2,938		457			—			37,700
Atlanta Perimeter	8,607		63,247		33,472		(3,656		)	—			101,670
Herndon	9,667		66,303		7,794		3,536			—			87,300
Deerfield	4,339		30,367		6,931		1,263			—			42,900
Total SOR Merger	$	71,529	$	436,350	$	89,357	$	9,864		$	—		$	607,100
Total acquisitions and SOR Merger	$	120,387	$	792,998	$	173,768	$	2,788		$	749		$	1,090,690

Aggregate purchase price of the acquisitions

The aggregate value of the 21 properties related to the 2015 acquisitions, SOR Merger, and completion of the Restoration Hardware project, which was transferred out of construction in progress in August 2015, was approximately $1.2 billion as shown below:

Property	Location	Tenant/Major Lessee	Acquisition/ Merger Date	Purchase Price			Approx. Square Feet	Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)			Unsecured Credit Facility		Other Debt Financings			Year of Lease Expiration (for Major Lessee)
GE Aviation	West Chester, OH	General Electric Company	2/19/2015	$	66,000		409,800	$	1,980		$	50,000	$	—		2020
Westgate III	Houston, TX	Wood Group Mustang, Inc.	4/1/2015	77,000			225,500	2,310			76,100		—			2026
Lisle	Lisle, IL	McCain Foods USA, Inc.	6/10/2015	19,500		(2)	94,400	(2)			(3)		—			2021
Bloomingdale	Bloomingdale, IL	BFS Retail & Commercial Operations, LLC	6/10/2015	7,450		(2)	71,100	(2)			(3)		—			2018
Columbia	Columbia, MD	Leidos Holdings, Inc.	6/10/2015	58,130		(2)	200,600	(2)			(3)		—			2019
Denver	Denver, CO	Jackson National Life Insurance Company	6/10/2015	35,000		(2)	182,900	(2)			(3)		—			2027
Columbus	Dublin, OH	Qwest Communications Company, LLC	6/10/2015	27,600		(2)	164,600	(2)			(3)		—			2022
Miramar	Miramar, FL	Humana Medical Plan Inc.	6/10/2015	24,600		(2)	96,400	(2)			(3)		—			2023
Irving Carpenter	Irving, TX	NEC Corporation of America	6/10/2015	23,500		(2)	119,600	(2)			(3)		—			2026
Frisco	Frisco, TX	T-Mobile West Corporation	6/10/2015	59,250		(2)	284,200	(2)			(3)		—			2017
Houston Westway II	Houston, TX	VetcoGray, Inc. (GE Oil & Gas, Inc.)	6/10/2015	82,500		(2)	242,400	(2)			(3)		—			2022
Houston Westway I	Houston, TX	Cameron Solutions	6/10/2015	37,700		(2)	144,000	(2)			(3)		—			2018
Atlanta Perimeter	Atlanta, GA	State Farm Mutual Automobile Insurance Company	6/10/2015	101,670		(2)	584,800	(2)			(3)		—			2023
Herndon	Herndon, VA	Time Warner Cable Southeast, LLC	6/10/2015	87,300		(2)	268,200	(2)			(3)		—			2019
Deerfield	Deerfield, IL	CF Industries Holdings, Inc.	6/10/2015	42,900		(2)	171,900	(2)			(3)		—			2027
DreamWorks	Glendale, CA	DreamWorks Animation SKG, Inc.	7/21/2015	215,000			459,800	(4)			205,000		—			2035
Restoration Hardware	Patterson, CA	Restoration Hardware, Inc.	8/15/2015	99,850		(5)	1,501,400	2,965		(5)	—		—			2030
Highway 94	Jefferson City, MO	ABB, Inc.	11/6/2015	31,940			660,000	958			—		19,033		(6)	2024
DynCorp	Fort Worth, TX	DynCorp International, LLC	12/11/2015	16,650			119,000	499			—		11,162		(6)	2018
Mercedes-Benz	Fort Worth, TX	Mercedes-Benz Financial Services USA	12/11/2015	29,000			164,300	870			—		18,945		(6)	2018

Property	Location	Tenant/Major Lessee	Acquisition/ Merger Date	Purchase Price		Approx. Square Feet	Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)		Unsecured Credit Facility		Other Debt Financings			Year of Lease Expiration (for Major Lessee)
Samsonite	Jacksonville, FL	Samsonite, LLC	12/11/2015	48,000		817,700	1,440		—		24,561		(6)	2024
				$	1,190,540	6,982,600	$	11,022	$	331,100	$	73,701

(1) The Advisor is entitled to receive acquisition fees equal to 2.5% and acquisition expense reimbursement of up to 0.5% of the contract purchase price for each property acquired. The total is included in acquisition fees and expenses to affiliates on the consolidated statements of operations.

(2) Represents a property assumed through the SOR Merger. Purchase Price represents purchase price allocations based on real estate value of $607.1 million. In conjunction with the SOR Merger on June 10, 2015, the Advisor received acquisition fees equal to 2.5%, or approximately $15.2 million, of the real estate value of $607.1 million. In addition, the Advisor also received actual expense reimbursements of $2.8 million, which was paid on July 14, 2015.

(3) In connection with the SOR Merger on June 10, 2015, the Company, through the Operating Partnership, borrowed $173.0 million from the Unsecured revolver (May 2014) to repay the outstanding SOR debt, as discussed in Note 5, Debt.

(4) The Advisor received acquisition fees equal to 2.5%, or approximately $5.4 million, of the acquisition value of $215.0 million. In addition, the Advisor also received actual expense reimbursements of $0.8 million.

(5) Represents a development project with WRRH Patterson, LLC, which was placed into service on August 15, 2015. The total acquisition fees and expense reimbursements payable to the Advisor were included in the basis of the property, as discussed in Note 4, Investments.

(6) Represents the mortgage loans assumed in conjunction with the acquisitions of the Highway 94, DynCorp, Mercedes-Benz, and Samsonite properties. See Note 5, Debt.

Schedule of pro forma financial information

The pro forma operating information includes certain nonrecurring adjustments, such as acquisition fees and expenses incurred as a result of the assets acquired in the acquisitions:

	Year Ended December 31,
	2015			2014
Revenue	$	345,092		$	318,720
Net income	$	63,170		$	49,499
Net income attributable to noncontrolling interests	$	1,259		$	979
Distributions to redeemable noncontrolling interests attributable to common stockholders	$	(359	)	$	(355	)
Net income attributable to common stockholders (1)	$	42,402		$	29,154
Net income attributable to common stockholders per share, basic and diluted	$	0.24		$	0.19

(1) Amount is net of net income (loss) attributable to noncontrolling interests and distributions to redeemable noncontrolling interests attributable to common stockholders.

Schedule of future minimum net rent payments

The future minimum contractual rent payments pursuant to the lease terms, with lease expirations ranging from 2016 to 2035, are shown in the table below:

2016	$	254,246
2017	253,976
2018	246,264
2019	215,126
2020	189,114
Thereafter	1,001,398
Total	$	2,160,124

Balance sheet components of real estate property available for sale

The following summary presents the major components of assets and liabilities related to the real estate held for sale as of December 31, 2015 and 2014:

	Balance December 31, 2015			Balance December 31, 2014
Restricted cash	$	561		$	1,450
Real Estate:
Land	8,025			10,256
Building	42,858			66,629
Tenant origination and absorption cost	20,003			21,400
Construction in progress	22			271
Total Real Estate	70,908			98,556
Less: accumulated depreciation and amortization	(7,034		)	(7,893		)
Total real estate, net	63,874			90,663
In-place lease valuation - above market	813			813
Deferred rent	2,716			2,135
Other assets	829			1,801
Total assets	$	68,793		$	96,862
Accounts payable and other liabilities	$	2,203		$	2,763
Due to affiliates	81			104
Restricted reserve	561			1,039
Total liabilities	$	2,845		$	3,906

Summary of gain (loss) from assets classified as held for sale

The following is a summary of the income (loss) included in the Company's income from continuing operations for the years ended December 31, 2015, 2014, and 2013 from assets classified as held for sale subsequent to the Company's adoption of ASU No. 2014-08, which includes the College Park, Will Partners, and One Century Place properties:

	Year Ended December 31,
	2015			2014			2013
Total revenues	$	12,128		$	13,231		$	5,254
Operating expenses	(6,368		)	(8,306		)	(4,189		)
Total revenues less operating expenses from assets classified as "held for sale," not qualifying as discontinued operations	5,760			4,925			1,065
Depreciation and amortization expense	(2,554		)	(8,156		)	(2,041		)
Interest expense	—			(907		)	(170		)
Income (loss) from assets classified as "held for sale," not qualifying as discontinued operations	$	3,206		$	(4,138	)	$	(1,146	)

Schedule of in-place lease valuation

	Balance December 31, 2015			Balance December 31, 2014
In-place lease valuation (above market)	$	45,413		$	26,289
In-place lease valuation (above market) - accumulated amortization	(10,844		)	(4,896		)
In-place lease valuation (above market), net	34,569			21,393
Ground leasehold interest (below market)	2,254			2,254
Ground leasehold interest (below market) - accumulated amortization	(54		)	(26		)
Ground leasehold interest (below market), net	2,200			2,228
Intangible assets, net	$	36,769		$	23,621
In-place lease valuation (below market)	$	(55,774	)	$	(48,448	)
In-place lease valuation (below market) - accumulated amortization	14,068			8,054
In-place lease valuation (below market), net	$	(41,706	)	$	(40,394	)
Tenant origination and absorption cost	$	516,879		$	359,416
Tenant origination and absorption cost - accumulated amortization	(119,593		)	(58,679		)
Tenant origination and absorption cost, net	$	397,286		$	300,737

Schedule of amortization expense

The amortization of the intangible assets and other leasing costs for the respective periods is as follows:

	Amortization (income) expense for the year ended December 31,
	2015			2014			2013
In-place lease valuation	$	(3,785	)	$	(468	)	$	(546	)
Tenant origination and absorption cost	$	69,099		$	45,044		$	14,098
Ground leasehold amortization (below market)	$	28		$	26		$	—
Other leasing costs amortization	$	301		$	143		$	—

The following table sets forth the estimated annual amortization (income) expense for in-place lease valuation, net, tenant origination and absorption costs, ground leasehold improvements, and other leasing costs as of December 31, 2015 for the next five years:

Year	In-place lease valuation, net			Tenant origination and absorption costs		Ground leasehold improvements		Other leasing costs
2016	$	1,028		$	63,111	$	28	$	1,000
2017	$	495		$	60,293	$	28	$	1,229
2018	$	(226	)	$	53,948	$	28	$	1,481
2019	$	(1,990	)	$	44,201	$	28	$	1,481
2020	$	(1,228	)	$	35,109	$	28	$	1,457

Schedule of restricted cash

Additionally, an ongoing replacement reserve is funded by certain tenants pursuant to each tenant’s respective lease as follows:

	Balance December 31, 2014		Additions		Deductions			Balance December 31, 2015
Tenant improvement reserves (1)	$	36,931	$	1,904	$	(25,942	)	$	12,893
Midland Mortgage loan repairs reserves (2)	453		—		—			453
Real estate tax reserve (Emporia Partners, TW Telecom, DynCorp, and Mercedes-Benz) (3)	1,074		2,601		(1,784		)	1,891
Property insurance reserve (Emporia Partners) (3)	251		494		(444		)	301
Restricted deposits	20		—		—			20
Midland Mortgage loan restricted lockbox (4)	2,023		2,044		(2,023		)	2,044
Restricted rent receipts (5)	—		6,585		—			6,585
	$	40,752	$	13,628	$	(30,193	)	$	24,187

(1) Additions represent tenant improvement reserves funded by the tenant and held by the lender. Deductions represent tenant improvement reimbursements made to certain tenants during the current period.

(2) Represents a deferred maintenance reserve funded by the Company as part of the refinancing that occurred on February 28, 2013, whereby certain properties became collateral for the Midland Mortgage loan.

(3) Additions represent monthly funding of real estate taxes and insurance by the tenants during the current period. Deductions represent reimbursements to the tenant for payment of real estate taxes and insurance premiums made during the current period.

(4) As part of the terms of the Midland Mortgage loan, rent collections from the eight properties which serve as collateral thereunder are received in a designated cash collateral account which is controlled by the lender until the designated payment date, as defined in the loan agreement, and the excess cash is transferred to the operating account.

(5) Addition represents rent and prepaid rent received from the DreamWorks property from August 2015 through January 2016, which is to be held in escrow pending a tax-deferred real estate exchange, as permitted by Section 1031 of the Internal Revenue Code, with the sale of the Will Partners and LTI properties. Such exchange was completed on January 12, 2016, thus, releasing any restrictions on the DreamWorks rent receipts.

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Investments (Tables)

12 Months Ended

Dec. 31, 2015

Equity Method Investments and Joint Ventures [Abstract]

Company's share of net earnings or losses and reduced by distributions

As of December 31, 2015, the balance of the investments totaled approximately $56.9 million as shown below:

	HealthSpring DST			Digital Realty Joint Venture			Total
Balance December 31, 2014	$	1,351		$	64,898		$	66,249
Other comprehensive loss	—			(189		)	(189		)
Net income (loss)	35			(1,510		)	(1,475		)
Distributions	(95		)	(7,627		)	(7,722		)
Balance December 31, 2015	$	1,291		$	55,572		$	56,863

Schedule of VIE's consolidated balances

The Company determined that control of the joint venture lies with its wholly-owned SPE. As such, the Company, in consolidation with the joint venture, included the following amounts on its consolidated balance sheet as of December 31, 2015 and 2014:

	Balance December 31, 2015				Balance December 31, 2014
Cash on hand	$	4,711			$	6,985
Deferred rent	372				—
Other assets	59				—
Construction in progress - paid by the joint venture	—				34,739
Construction in progress - paid by the Company	—				70
Leasing commissions, net	731				375
Land	15,463			(1)	15,185
Building	57,595			(1)	—
Tenant improvements	18,040			(1)	—
Accumulated depreciation	(1,314		)		—
Construction in progress payable	—				(13,423		)
Accounts payable and other liabilities	(21,979		)		—
Due to affiliates	(3,324		)		—
Noncontrolling interest	—				(7,656		)
Total investment	$	70,354			$	36,275

(1) Includes $3.0 million of acquisition fees and expense reimbursements, as discussed in Note 3, Real Estate.

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Debt (Tables)

12 Months Ended

Dec. 31, 2015

Debt Disclosure [Abstract]

Schedule of Debt

As of December 31, 2015 and 2014, the Company’s debt consisted of the following:

	Balance December 31, 2015			Balance December 31, 2014		Contractual Interest Rate (1)		Payment Type	Loan Maturity
Plainfield mortgage loan	$	19,295		$	19,638	6.650%		Principal and Interest	November 2017
Emporia Partners mortgage loan	3,753			4,108		5.880%		Principal and Interest	September 2023
LTI mortgage loan	—			32,128		5.800%		Principal and Interest	March 2016
LTI mortgage loan premium	—			102		—		—	—
TransDigm mortgage loan	6,432			6,576		5.980%		Principal and Interest	June 2016
TransDigm mortgage loan premium	22			75		—		—	—
Ace Hardware mortgage loan	23,294			23,648		5.588%		Principal and Interest	October 2024
Ace Hardware mortgage loan premium	1,508			1,681		—		—	—
Highway 94 mortgage loan	18,968			—		3.750%		Principal and Interest	August 2024
Highway 94 mortgage loan discount	(2,210		)	—		—		—	—
DynCorp mortgage loan	11,162			—		4.700%		Principal and Interest	July 2016
Mercedes-Benz mortgage loan	18,945			—		6.018%		Principal and Interest	November 2016
Samsonite mortgage loan	24,561			—		6.080%		Principal and Interest	September 2023
Samsonite mortgage loan premium	1,490			—		—		—	—
Midland Mortgage loan	105,600			105,600		3.940%		Interest Only through March 2017/Principal and Interest thereafter	April 2023
AIG loan	110,640			110,640		4.960%		Interest Only through January 2017/Principal and Interest thereafter	February 2029
TW Telecom loan	21,213			21,500		LIBO Rate +2.45%	(2)	Interest Only through July 2015/Principal and Interest thereafter	August 2019
Mortgage Loan Total	364,673			325,696
Unsecured term loan (May 2014)	—			300,000		LIBO Rate +1.45%		Interest Only	May 2019
Term Loan (July 2015)	640,000			—		LIBO Rate +1.25%	(2)	Interest Only	July 2020
Revolver Loan (July 2015)	481,653			—		LIBO Rate +1.30%	(2)	Interest Only	July 2020	(3)
Total	$	1,486,326		$	625,696

(1) Including the effect of an interest rate swap agreement with a notional amount of $425.0 million, the weighted average interest rate as of December 31, 2015 was 2.8% for the Company's fixed-rate and variable-rate debt combined and approximately 3.8% for the Company's fixed-rate debt only.

(2) The LIBO Rate as of December 31, 2015 was 0.30% (effective as of December 11, 2015).

(3) The Revolver Loan (July 2015) has an initial term of four years, maturing on July 20, 2019, and may be extended for a one-year period if certain conditions are met and upon payment of an extension fee. See discussion below.

Summary of future principal repayments of all loans

The following summarizes the future principal repayments of all loans as of December 31, 2015 per the loan terms discussed above:

	December 31, 2015
2016	$	40,078	(1)
2017	22,237		(2)
2018	7,077
2019	25,153		(3)
2020	1,128,486		(4)
Thereafter	262,485		(4)
Total principal	1,485,516
Unamortized debt premium	810
Total	$	1,486,326

(1) Amount includes payment of the balances of the TransDigm, DynCorp, and Mercedes-Benz property mortgage loans, which mature in 2016.

(2) Amount includes payment of the balance of the Plainfield property mortgage loan, which matures in 2017.

(3) Amount includes payment of the balance of the TW Telecom loan, which matures in 2019.

(4) Amount includes payment of the balances of:

• the Term Loan (July 2015), which matures in 2020,

• the Revolver Loan (July 2015), which matures in 2020, assuming the one-year extension is exercised,

• the Midland Mortgage, Emporia Partners, and Samsonite property mortgage loans, all of which mature in 2023,

• the Ace Hardware and Highway 94 property mortgage loans, which mature in 2024, and

• the AIG loan, which matures in 2029.

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Interest Rate Contracts (Tables)

12 Months Ended

Dec. 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Summary of Interest Rate Swaps

The following table sets forth a summary of the interest rate swaps at December 31, 2015:

		Maturity	Interest	Fair value (2)			Current Notional Amount (3)
Derivative Instrument	Effective Date (1)	Date	Strike Rate	December 31, 2015			December 31, 2015
Liabilities:
Interest Rate Swap	7/9/2015	7/1/2020	1.687%	$	(4,305	)	$	425,000
Interest Rate Swap	1/1/2016	7/1/2018	1.320%	$	(1,605	)	$	—
Interest Rate Swap	7/1/2016	7/1/2018	1.495%	$	(484	)	$	—

(1) The Company entered into all interest rate swap agreements in 2015. Thus, no prior period information is available.

(2) The Company records all derivative instruments on a gross basis on the consolidated balance sheets, and accordingly, there are no offsetting amounts that net assets against liabilities. As of December 31, 2015, all of the derivatives were in a liability position, and as such, the fair value is included in the line item "Interest rate swap liability" on the consolidated balance sheets.

(3) Represents the notional amount of swaps that are effective as of the balance sheet date of December 31, 2015.

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Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2015

Fair Value Disclosures [Abstract]

Liabilities fair value measured on recurring basis

The following tables set forth the liabilities that the Company measures at fair value on a recurring basis by level within the fair value hierarchy as of December 31, 2015:

Liabilities	Total Fair Value			Quoted Prices in Active Markets for Identical Assets and Liabilities		Significant Other Observable Inputs			Significant Unobservable Inputs
Interest Rate Swaps at (1):
December 31, 2015	$	(6,394	)	$	—	$	(6,394	)	$	—

(1) The Company entered into all interest rate swap agreements in 2015. Thus, no prior period information is available.

Schedule of carrying values and estimated fair values of financial instruments

	December 31, 2015				December 31, 2014
	Fair Value		Carrying Value (1)		Fair Value		Carrying Value (1)
Plainfield mortgage loan	$	20,240	$	19,295	$	20,994	$	19,638
Emporia Partners mortgage loan	3,742		3,753		4,434		4,108
LTI mortgage loan	—		—		32,742		32,128
TransDigm mortgage loan	6,432		6,432		6,748		6,576
Ace Hardware mortgage loan	23,778		23,294		26,424		23,648
Midland Mortgage loan	107,154		105,600		105,155		105,600
AIG loan	114,747		110,640		122,062		110,640
Highway 94 mortgage loan	17,658		18,968		—		—
DynCorp mortgage loan (2)	11,162		11,162		—		—
Mercedes-Benz mortgage loan (2)	18,945		18,945		—		—
Samsonite mortgage loan	26,044		24,561		—		—

(1) The carrying value of the TransDigm, Ace Hardware, Highway 94, and Samsonite property mortgage loans do not include the net debt premium of $0.8 million and $1.9 million as of December 31, 2015 and 2014, respectively. See Note 5, Debt, for details.

(2) The fair value is identical to the carrying value as of December 31, 2015 since all three property mortgage loans mature in 2016.

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Equity (Tables)

12 Months Ended

Dec. 31, 2015

Equity [Abstract]

Share redemption price

Effective March 17, 2013, the redemption price per share shall be as shown below, which is based upon the number of years the stock is held:

Period of Time Held	Redemption Price
At least one year	Lower of $9.25 or the price paid by the stockholder
At least two years	Lower of $9.50 or the price paid by the stockholder
At least three years	Lower of $9.75 or the price paid by the stockholder
At least four years	Lower of $10.28 or the price paid by the stockholder

Schedule of activity for noncontrolling interests

The following summarizes the activity for noncontrolling interests recorded as equity for the years ended December 31, 2015, 2014, and 2013:

	Year Ended December 31,
	2015			2014			2013
Beginning balance	$	17,478		$	19,736		$	17,512
Contribution/issuance of noncontrolling interests	7,282			1,504			8,095
Distributions to noncontrolling interests	(3,150		)	(3,050		)	(2,730		)
Allocated distributions to noncontrolling interests subject to redemption	(10		)	(14		)	(49		)
Net loss	(138		)	(698		)	(3,092		)
Other comprehensive loss	(144		)	—			—
Ending balance	$	21,318		$	17,478		$	19,736

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Related Party Transactions (Tables)

12 Months Ended

Dec. 31, 2015

Related Party Transaction, Due from (to) Related Party [Abstract]

Schedule of related party transactions

The following table summarizes the related party costs and fees incurred, paid and due to affiliates as of December 31, 2015 and 2014:

	As of December 31, 2014			Year Ended December 31, 2015
	Payable			Incurred			Paid		Payable
Advisor and Property Manager fees
Acquisition fees and expenses	—			35,210		(1)	32,245		2,965
Operating expenses/leasing commissions	202			3,713			1,738		2,177
Asset management fees	1,189			18,753			17,818		2,124
Property management fees	460			7,149			6,411		1,198
Disposition fees (2)	—			640			353		287
Costs advanced by the Advisor	—			53			47		6
Total, net of real estate assets held for sale	1,851			65,518			58,612		8,757
Asset management fees related to real estate held for sale (3)	65			636			657		44
Property management fees related to real estate held for sale (3)	39			473			475		37
Total	$	1,955	(1)	$	66,627		$	59,744	$	8,838

(1)     Includes approximately $3.0 million of acquisition fees and expense reimbursements related to the Restoration Hardware property, as discussed in Note

3, Real Estate, which are also included in the basis of the property.

(2)     The disposition expense represents fees incurred from the sale of the College Park, Will Partners, and LTI properties.

(3)     Represents asset management fees and property management fees for the College Park, Will Partners, and One Century Place properties.

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Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Contractual Obligation, Fiscal Year Maturity Schedule

As of December 31, 2015, the remaining required payments under the terms of the ground lease are as follows:

	December 31, 2015
2016	$	180
2017	198
2018	198
2019	198
2020	198
Thereafter	34,048
Total	$	35,020

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Selected Quarterly Financial Data (Unaudited) (Tables)

12 Months Ended

Dec. 31, 2015

Quarterly Financial Information Disclosure [Abstract]

Summary of quarterly financial information

Presented below is a summary of the unaudited quarterly financial information for the years ended December 31, 2015 and 2014:

	2015
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Total revenue	$	55,213		$	61,563		$	82,849		$	90,470
Net income (loss)	$	11,101		$	(11,655	)	$	4,005		$	12,170
Net income (loss) attributable to common stockholders	$	6,116		$	(21,409	)	$	1,544		$	9,999
Net loss per share	$	0.05		$	(0.15	)	$	0.01		$	0.06
	2014
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Total revenue	$	47,992		$	47,285		$	52,631		$	54,486
Net income (loss)	$	2,740		$	(7,990	)	$	381		$	4,883
Net loss attributable to common stockholders	$	(1,920	)	$	(12,378	)	$	(4,354	)	$	(2	)
Net loss per share	$	(0.03	)	$	(0.10	)	$	(0.03	)	$	(0.01	)

XML

Organization - Narrative (Details)				3 Months Ended	12 Months Ended			20 Months Ended	33 Months Ended
	Jun. 10, 2015 shares	Apr. 26, 2013 USD ($) $ / shares shares	Apr. 25, 2013 USD ($) shares	Dec. 31, 2015 USD ($) property shares	Dec. 31, 2015 USD ($) property shares	Dec. 31, 2014 USD ($) shares	Dec. 31, 2013 USD ($)	Dec. 31, 2014 USD ($) shares	Dec. 31, 2015 USD ($) property $ / shares shares	Oct. 22, 2015 $ / shares	Sep. 22, 2015 USD ($)	Nov. 21, 2014	May. 07, 2014 USD ($)	Nov. 06, 2009 $ / shares shares	Aug. 29, 2008 USD ($)	Aug. 28, 2008 USD ($) shares
Subsidiary, Sale of Stock [Line Items]
Agreement term					1 year
Number of successive period					1 year
Common stock, number of shares outstanding (in shares) | shares				175,184,519	175,184,519	129,763,016		129,763,016	175,184,519							100
Common stock value purchased by Advisor																$ 1,000
Number of common shares (in shares) | shares														82,500,000
Number of shares issued (in shares) | shares								107,144,337
Proceeds for issuance of common stock					$ 0	$ 774,722,000	$ 364,740,000	$ 1,100,000,000
Share price (in USD per share) | $ / shares										$ 10.40
Common stock subject to redemption (in shares)				$ 6,300,000	6,300,000	1,200,000		$ 1,200,000	$ 6,300,000
Repurchase of common stock					13,819,000	$ 2,560,000	$ 614,000
Payments to acquire partnership															$ 200,000
Initial capital contribution				$ 1,000	$ 1,000				$ 1,000
General partner interest obtained				1.00%	1.00%				1.00%
Ownership percent					97.00%
Number of properties contributed | property				5	5				5
Repurchase of noncontrolling interest | shares					0	0
Advisor
Subsidiary, Sale of Stock [Line Items]
Limited liability partnership interest held															99.00%
Sponsor and Affiliates
Subsidiary, Sale of Stock [Line Items]
Limited liability partnership interest held				1.00%	1.00%				1.00%
Third parties
Subsidiary, Sale of Stock [Line Items]
Limited liability partnership interest held				2.00%	2.00%				2.00%
Sale to Public
Subsidiary, Sale of Stock [Line Items]
Number of common shares (in shares) | shares														75,000,000
Common stock offer price per share (in dollars per share) | $ / shares														$ 10.00
Number of shares issued (in shares) | shares			19,200,570
Proceeds from shares issued			$ 191,500,000
Distribution Reinvestment Plan
Subsidiary, Sale of Stock [Line Items]
Number of common shares (in shares) | shares														7,500,000
Common stock offer price per share (in dollars per share) | $ / shares														$ 9.50
Number of shares issued (in shares) | shares			585,533		8,579,699			1,774,208
Proceeds from shares issued			$ 5,600,000
Number of shares initially offered (in shares) | shares		10,200,000
Discount to market price		95.00%
Weighted average issuance price for DRP (in USD per share) | $ / shares		$ 9.77
Common stock of the Company pursuant to the distribution reinvestment plan		$ 100,000,000.0
Proceeds for issuance of common stock								$ 17,300,000
Value of shares for sale											$ 100,000,000.0		$ 75,000,000.0
Proceeds from distribution reinvestment plan					$ 87,300,000
Equity offering termination period				10 days
Common stock issued				$ 110,200,000	110,200,000	$ 57,700,000		$ 57,700,000	$ 110,200,000
Primary Follow-On Offering and Primary Public Offering
Subsidiary, Sale of Stock [Line Items]
Common stock offer price per share (in dollars per share) | $ / shares		$ 10.28
Maximum follow-on public offering approved		$ 1,000,000,000.0
Number of shares initially offered (in shares) | shares		97,200,000
Private Offering
Subsidiary, Sale of Stock [Line Items]
Proceeds from issuance of private placement					1,400,000,000
SOR Merger | Common Stock
Subsidiary, Sale of Stock [Line Items]
Stock conversion ratio												2.04
Number of shares issued for acquisition (in shares) | shares	41,800,000
Share Redemption Program
Subsidiary, Sale of Stock [Line Items]
Common stock subject to redemption (in shares)				$ 6,300,000	$ 6,300,000				$ 6,300,000
Stock redeemed during period (in shares) | shares									1,753,700
Repurchase of common stock									$ 17,300,000
Price per share redeemed (in USD per share) | $ / shares									$ 9.88

XML

Basis of Presentation and Summary of Significant Accounting Policies - Narrative (Details Textual)				3 Months Ended	12 Months Ended
	Jun. 16, 2015 $ / shares shares	Jun. 12, 2014 $ / shares shares	Mar. 03, 2014 shares	Dec. 31, 2015 USD ($) property Property $ / shares shares	Dec. 31, 2015 USD ($) property Property segment shares	Dec. 31, 2014 USD ($) shares	Dec. 31, 2013 USD ($)	Jan. 24, 2014 USD ($)
Property, Plant and Equipment [Line Items]
Maximum maturity period of cash and cash equivalents					3 months
Restricted cash				$ 24,187,000	$ 24,187,000	$ 40,752,000
Number of rented properties serve as collateral | property				8	8
Restricted cash - real estate funds held for exchange				$ 47,031,000	$ 47,031,000	10,105,000
Percentage of noncontrolling interest in acquisitions				3.00%	3.00%
Acquisition-related costs					$ 35,000,000	28,600,000	$ 29,500,000
Depreciation expense					43,320,000	27,694,000	10,093,000
Amortization of intangible assets					$ 69,428,000	45,213,000	14,098,000
Property classified as held for sale | Property				1	1
Impairment charges					$ 0	0
Ground lease term					80 years
Recognized deferred rent					$ 13,800,000	11,600,000	3,500,000
Deferred rent				$ 26,432,000	26,432,000	15,619,000
Amount refundable to the tenants				2,300,000	$ 2,300,000
Days required for reimburse excess amounts					60 days
Cumulative offering costs for private and public offerings				130,600,000	$ 130,600,000
Cumulative organizational costs for private and public offerings				800,000	800,000
Amortization of deferred financing costs					3,764,000	3,853,000	$ 1,943,000
Write off of deferred debt issuance cost					1,400,000	1,700,000
Deferred financing costs, net				12,899,000	12,899,000	11,791,000
Tenant origination and absorption cost				$ 516,879,000	$ 516,879,000	$ 359,416,000
Term for share based compensation plan					10 years
Percentage of common stock reserved for issuance					10.00%
Number of shares authorized (in shares) | shares				10,000,000	10,000,000
REIT Period for federal income tax					4 years
Common stock equivalents (in shares) | shares				0	0	0
Distributions declared per common share (in dollars per share) | $ / shares				$ 0.001901096
Number of reportable segments | segment					1
Restricted Stock
Property, Plant and Equipment [Line Items]
Number of shares authorized (in shares) | shares	1,000		5,000
Number of additional shares authorized (in shares) | shares		1,000	1,000
Vesting period			3 years
Shares vested (in shares) | shares					333
Shares granted (USD per share) | $ / shares	$ 10.40	$ 10.28
Restricted Stock | Director
Property, Plant and Equipment [Line Items]
Required employment term for award					12 months
Maximum
Property, Plant and Equipment [Line Items]
Percentage of noncontrolling interest in acquisitions				100.00%	100.00%
Percentage of gross offering proceeds of the terminated or completed Public Offering					15.00%
Minimum
Property, Plant and Equipment [Line Items]
Percentage of gross offering proceeds of the terminated or completed Public Offering					3.50%
Will Partners | World Kitchen LLC
Property, Plant and Equipment [Line Items]
Lease termination fees								$ 4,900,000
Wells Fargo | Wells Fargo Bank, NA
Property, Plant and Equipment [Line Items]
Lease termination fees								$ 2,900,000
Restricted Cash
Property, Plant and Equipment [Line Items]
Restricted cash - real estate funds held for exchange				$ 6,600,000	$ 6,600,000
Other Assets
Property, Plant and Equipment [Line Items]
Tenant origination and absorption cost				13,200,000	13,200,000	$ 2,200,000
Cash Designated for Deferred Maintenance and Releasing Costs
Property, Plant and Equipment [Line Items]
Restricted cash				13,300,000	13,300,000
Cash Designated for Taxes and Insurance Reserves
Property, Plant and Equipment [Line Items]
Restricted cash				2,200,000	2,200,000
Will Partners and LTI Properties | Sale of operation
Property, Plant and Equipment [Line Items]
Restricted cash - real estate funds held for exchange				47,000,000	47,000,000
Midland Mortgage loan
Property, Plant and Equipment [Line Items]
Rent collections served as collateral				$ 2,000,000	$ 2,000,000

XML

Basis of Presentation and Summary of Significant Accounting Policies - Property and Equipment (Details)	12 Months Ended
	Dec. 31, 2015
Buildings | Minimum
Property, Plant and Equipment [Line Items]
Estimated life of assets	25 years
Buildings | Maximum
Property, Plant and Equipment [Line Items]
Estimated life of assets	40 years
Building Improvements | Minimum
Property, Plant and Equipment [Line Items]
Estimated life of assets	5 years
Building Improvements | Maximum
Property, Plant and Equipment [Line Items]
Estimated life of assets	20 years
Land Improvements | Minimum
Property, Plant and Equipment [Line Items]
Estimated life of assets	15 years
Land Improvements | Maximum
Property, Plant and Equipment [Line Items]
Estimated life of assets	25 years

XML

Real Estate - Narrative (Details) ft² in Thousands, $ in Thousands, shares in Millions						12 Months Ended
	Dec. 31, 2015 USD ($) property Property state	Nov. 06, 2015 USD ($) ft² investor shares	Aug. 07, 2015 USD ($)	Jun. 10, 2015 USD ($) ft² property building state shares	Feb. 20, 2015 USD ($)	Dec. 31, 2015 USD ($) property Property state	Dec. 31, 2014 USD ($)	Dec. 31, 2013 USD ($)	Jan. 24, 2014 USD ($)	Nov. 05, 2013 property
Real Estate Properties [Line Items]
Number of properties | property	74					74				18
Number of states | state	20					20
Purchase price	$ 3,000,000					$ 3,000,000
Net assets acquired	1,090,690					1,090,690
Tenant security deposits	800					800	$ 200
Tenant receivables	2,200					2,200	300
Real estate assets and other assets held for sale, net	68,792					68,792	96,862
Gain from sale of depreciable operating property						13,813	3,104	$ 0
Proceeds from disposition of properties						90,323	10,141	0
Real estate investment property	2,696,026					2,696,026	1,721,012	$ 1,132,617
Deferred rent	26,432					26,432	15,619
Deferred leasing costs	$ 397,286					$ 397,286	$ 300,737
Lease term						7 years 9 months 18 days	7 years 10 months 24 days
Property classified as held for sale | Property	1					1
Will Partners | World Kitchen LLC
Real Estate Properties [Line Items]
Lease termination fees									$ 4,900
Series of Individually Immaterial Business Acquisitions
Real Estate Properties [Line Items]
Number of real estate assets acquired | property						6
Net assets acquired	$ 483,590					$ 483,590
SOR Merger
Real Estate Properties [Line Items]
Number of properties | property				13
Number of states | state				8
Net assets acquired	$ 607,100			$ 607,100		$ 607,100
Number of buildings | building				15
Net rentable area (in sqft) | ft²				2,600
Issuance of shares pursuant to Signature Office REIT merger (in shares) | shares				41.8
Aggregate purchase price of acquired properties				$ 607,100
Highway 94
Real Estate Properties [Line Items]
Purchase price		$ 31,900
Net rentable area (in sqft) | ft²		660
Issuance of shares pursuant to Signature Office REIT merger (in shares) | shares		7.3
Payment for acquisition		$ 24,600
Liability assumed for acquisition		$ 19,000
Number of investors | investor		45
Payments to acquire business		$ 5,600
2015 Acquisitions
Real Estate Properties [Line Items]
Number of properties | property	21					21
Aggregate purchase price of acquired properties	$ 1,190,540					$ 1,190,540
Affiliated Entity | Series of Individually Immaterial Business Acquisitions
Real Estate Properties [Line Items]
Number of real estate assets acquired | property						1
LTI Property | Sale of operation
Real Estate Properties [Line Items]
Closing costs and other credits	300
Gain from sale of depreciable operating property	6,100
Disposition fees payment	300
Proceeds from disposition of properties	57,400
Real estate investment property	51,000					$ 51,000
Real estate held-for-sale	45,200					45,200
Deferred rent	1,600					1,600
Deferred leasing costs	$ 4,200					$ 4,200
College Park Plaza, Indianapolis IN | Sale of operation
Real Estate Properties [Line Items]
Proceeds from assets held-for-sale					$ 14,300
Closing costs and other credits					2,500
Real estate assets and other assets held for sale, net					8,200
Real estate held for sale					6,400
Deferred rent					800
Deferred leasing costs					1,000
Gain from sale of depreciable operating property					3,600
Disposition fees payment					$ 100
Will Partners | Sale of operation
Real Estate Properties [Line Items]
Gain from sale of depreciable operating property			$ 4,100
Disposition fees payment			200
Consideration for disposal group			22,000
Transaction costs for disposal group			800
Total assets held-for-sale			$ 17,100
One Century Place Property
Real Estate Properties [Line Items]
Property classified as held for sale	1					1

XML

Real Estate - SOR Acquisition (Details) - USD ($) $ in Thousands		12 Months Ended
	Jun. 10, 2015	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Business Acquisition [Line Items]
Land		$ 120,387
SOR Merger
Business Acquisition [Line Items]
Cash assumed	$ 8,557
Land	71,529	71,529
Building and improvements	436,350
Tenant origination and absorption cost	89,357
Above market leases	16,860
Other assets	2,148
Total assets	624,801
Unsecured debt	173,000
Below market leases	6,996
Accounts payable and other liabilities	11,138
Total liabilities	191,134
Equity consideration for SOR Merger	433,667	$ 433,667	$ 0	$ 0
Total liabilities and equity	$ 624,801

XML

Real Estate - Schedule of Acquisitions (Details) $ in Thousands		12 Months Ended
	Jun. 10, 2015 USD ($)	Dec. 31, 2015 USD ($) ft²	Dec. 31, 2014 USD ($)	Dec. 31, 2013 USD ($)	Jul. 14, 2015 USD ($)
Real Estate Properties [Line Items]
Approx. Square Feet (in sqft) | ft²		6,982,600
Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)		$ 11,022
Unsecured Credit Facility		331,100
Other Debt Financings		$ 73,701
Percentage of acquisition fees		2.50%
Acquisition fees and expenses to non- affiliates		$ 35,000	$ 28,600	$ 29,500
Percent reimbursed		0.50%
Due to affiliates		$ 8,757	1,851
Proceed from line		0	$ 151,000	$ 198,000
Advisor
Real Estate Properties [Line Items]
Due to affiliates		3,000
SOR Merger
Real Estate Properties [Line Items]
Purchase Price	$ 607,100
Percentage of acquisition fees	2.50%
Acquisition fees and expenses to non- affiliates	$ 15,200
SOR Merger | Advisor
Real Estate Properties [Line Items]
Due to affiliates					$ 2,800
SOR Merger | Keybank Syndication Partners | Unsecured Revolver, Credit Facility
Real Estate Properties [Line Items]
Proceed from line	$ 173,000
DreamWorks
Real Estate Properties [Line Items]
Acquisition fees and expenses to non- affiliates		5,400
DreamWorks | Advisor
Real Estate Properties [Line Items]
Due to affiliates		800
GE Aviation
Real Estate Properties [Line Items]
Purchase Price		$ 66,000
Approx. Square Feet (in sqft) | ft²		409,800
Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)		$ 1,980
Unsecured Credit Facility		50,000
Westgate III
Real Estate Properties [Line Items]
Purchase Price		$ 77,000
Approx. Square Feet (in sqft) | ft²		225,500
Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)		$ 2,310
Unsecured Credit Facility		76,100
Lisle
Real Estate Properties [Line Items]
Purchase Price		$ 19,500
Approx. Square Feet (in sqft) | ft²		94,400
Bloomingdale
Real Estate Properties [Line Items]
Purchase Price		$ 7,450
Approx. Square Feet (in sqft) | ft²		71,100
Columbia
Real Estate Properties [Line Items]
Purchase Price		$ 58,130
Approx. Square Feet (in sqft) | ft²		200,600
Denver
Real Estate Properties [Line Items]
Purchase Price		$ 35,000
Approx. Square Feet (in sqft) | ft²		182,900
Columbus
Real Estate Properties [Line Items]
Purchase Price		$ 27,600
Approx. Square Feet (in sqft) | ft²		164,600
Miramar
Real Estate Properties [Line Items]
Purchase Price		$ 24,600
Approx. Square Feet (in sqft) | ft²		96,400
Irving Carpenter
Real Estate Properties [Line Items]
Purchase Price		$ 23,500
Approx. Square Feet (in sqft) | ft²		119,600
Frisco
Real Estate Properties [Line Items]
Purchase Price		$ 59,250
Approx. Square Feet (in sqft) | ft²		284,200
Houston Westway II
Real Estate Properties [Line Items]
Purchase Price		$ 82,500
Approx. Square Feet (in sqft) | ft²		242,400
Houston Westway I
Real Estate Properties [Line Items]
Purchase Price		$ 37,700
Approx. Square Feet (in sqft) | ft²		144,000
Atlanta Perimeter
Real Estate Properties [Line Items]
Purchase Price		$ 101,670
Approx. Square Feet (in sqft) | ft²		584,800
Herndon
Real Estate Properties [Line Items]
Purchase Price		$ 87,300
Approx. Square Feet (in sqft) | ft²		268,200
Deerfield
Real Estate Properties [Line Items]
Purchase Price		$ 42,900
Approx. Square Feet (in sqft) | ft²		171,900
DreamWorks
Real Estate Properties [Line Items]
Purchase Price		$ 215,000
Approx. Square Feet (in sqft) | ft²		459,800
Unsecured Credit Facility		$ 205,000
Percentage of acquisition fees	2.50%
Restoration Hardware
Real Estate Properties [Line Items]
Purchase Price		$ 99,850
Approx. Square Feet (in sqft) | ft²		1,501,400
Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)		$ 2,965
Highway 94
Real Estate Properties [Line Items]
Purchase Price		$ 31,940
Approx. Square Feet (in sqft) | ft²		660,000
Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)		$ 958
Other Debt Financings		19,033
DynCorp
Real Estate Properties [Line Items]
Purchase Price		$ 16,650
Approx. Square Feet (in sqft) | ft²		119,000
Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)		$ 499
Other Debt Financings		11,162
Mercedes-Benz
Real Estate Properties [Line Items]
Purchase Price		$ 29,000
Approx. Square Feet (in sqft) | ft²		164,300
Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)		$ 870
Other Debt Financings		18,945
Samsonite
Real Estate Properties [Line Items]
Purchase Price		$ 48,000
Approx. Square Feet (in sqft) | ft²		817,700
Acquisition Fees and Reimbursable Expenses Paid to the Advisor (1)		$ 1,440
Other Debt Financings		$ 24,561

XML

Real Estate - Purchase Price Allocation (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Jun. 10, 2015	Dec. 31, 2014	Dec. 31, 2013
Real Estate Properties [Line Items]
Land	$ 120,387
Building and improvements	792,998
Tenant origination and absorption cost	173,768
Debt discount/(premium)	749		$ 1,799	$ 0
Total	1,090,690
In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	2,788
Series of Individually Immaterial Business Acquisitions
Real Estate Properties [Line Items]
Land	48,858
Building and improvements	356,648
Tenant origination and absorption cost	84,411
Debt discount/(premium)	749
Total	483,590
Series of Individually Immaterial Business Acquisitions | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	(7,076)
Series of Individually Immaterial Business Acquisitions | GE Aviation
Real Estate Properties [Line Items]
Land	4,400
Building and improvements	52,211
Tenant origination and absorption cost	9,470
Debt discount/(premium)	0
Total	66,000
Series of Individually Immaterial Business Acquisitions | GE Aviation | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	(81)
Series of Individually Immaterial Business Acquisitions | Westgate III
Real Estate Properties [Line Items]
Land	3,209
Building and improvements	60,852
Tenant origination and absorption cost	15,085
Debt discount/(premium)	0
Total	77,000
Series of Individually Immaterial Business Acquisitions | Westgate III | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	(2,146)
Series of Individually Immaterial Business Acquisitions | DreamWorks
Real Estate Properties [Line Items]
Land	26,387
Building and improvements	148,163
Tenant origination and absorption cost	42,642
Debt discount/(premium)	0
Total	215,000
Series of Individually Immaterial Business Acquisitions | DreamWorks | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	(2,192)
Series of Individually Immaterial Business Acquisitions | Highway 94
Real Estate Properties [Line Items]
Land	5,540
Building and improvements	21,300
Tenant origination and absorption cost	6,930
Debt discount/(premium)	2,250
Total	31,940
Series of Individually Immaterial Business Acquisitions | Highway 94 | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	(4,080)
Series of Individually Immaterial Business Acquisitions | DynCorp
Real Estate Properties [Line Items]
Land	1,952
Building and improvements	13,546
Tenant origination and absorption cost	1,994
Debt discount/(premium)	0
Total	16,650
Series of Individually Immaterial Business Acquisitions | DynCorp | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	(842)
Series of Individually Immaterial Business Acquisitions | Mercedes-Benz
Real Estate Properties [Line Items]
Land	2,330
Building and improvements	23,424
Tenant origination and absorption cost	2,952
Debt discount/(premium)	0
Total	29,000
Series of Individually Immaterial Business Acquisitions | Mercedes-Benz | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	294
Series of Individually Immaterial Business Acquisitions | Samsonite
Real Estate Properties [Line Items]
Land	5,040
Building and improvements	37,152
Tenant origination and absorption cost	5,338
Debt discount/(premium)	(1,501)
Total	48,000
Series of Individually Immaterial Business Acquisitions | Samsonite | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	1,971
SOR Merger
Real Estate Properties [Line Items]
Land	71,529	$ 71,529
Building and improvements	436,350
Tenant origination and absorption cost	89,357
Debt discount/(premium)	0
Total	607,100	$ 607,100
SOR Merger | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	9,864
SOR Merger | Lisle
Real Estate Properties [Line Items]
Land	2,788
Building and improvements	11,209
Tenant origination and absorption cost	4,991
Debt discount/(premium)	0
Total	19,500
SOR Merger | Lisle | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	512
SOR Merger | Bloomingdale
Real Estate Properties [Line Items]
Land	1,178
Building and improvements	4,689
Tenant origination and absorption cost	493
Debt discount/(premium)	0
Total	7,450
SOR Merger | Bloomingdale | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	1,090
SOR Merger | Columbia
Real Estate Properties [Line Items]
Land	6,989
Building and improvements	42,690
Tenant origination and absorption cost	4,185
Debt discount/(premium)	0
Total	58,130
SOR Merger | Columbia | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	4,266
SOR Merger | Denver
Real Estate Properties [Line Items]
Land	9,948
Building and improvements	22,714
Tenant origination and absorption cost	1,174
Debt discount/(premium)	0
Total	35,000
SOR Merger | Denver | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	1,164
SOR Merger | Columbus
Real Estate Properties [Line Items]
Land	2,943
Building and improvements	14,896
Tenant origination and absorption cost	7,755
Debt discount/(premium)	0
Total	27,600
SOR Merger | Columbus | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	2,006
SOR Merger | Miramar
Real Estate Properties [Line Items]
Land	4,488
Building and improvements	18,211
Tenant origination and absorption cost	1,768
Debt discount/(premium)	0
Total	24,600
SOR Merger | Miramar | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	133
SOR Merger | Irving Carpenter
Real Estate Properties [Line Items]
Land	1,842
Building and improvements	19,479
Tenant origination and absorption cost	2,573
Debt discount/(premium)	0
Total	23,500
SOR Merger | Irving Carpenter | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	(394)
SOR Merger | Frisco
Real Estate Properties [Line Items]
Land	8,239
Building and improvements	47,296
Tenant origination and absorption cost	4,099
Debt discount/(premium)	0
Total	59,250
SOR Merger | Frisco | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	(384)
SOR Merger | Houston Westway II
Real Estate Properties [Line Items]
Land	3,961
Building and improvements	67,484
Tenant origination and absorption cost	11,184
Debt discount/(premium)	0
Total	82,500
SOR Merger | Houston Westway II | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	(129)
SOR Merger | Houston Westway I
Real Estate Properties [Line Items]
Land	6,540
Building and improvements	27,765
Tenant origination and absorption cost	2,938
Debt discount/(premium)	0
Total	37,700
SOR Merger | Houston Westway I | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	457
SOR Merger | Atlanta Perimeter
Real Estate Properties [Line Items]
Land	8,607
Building and improvements	63,247
Tenant origination and absorption cost	33,472
Debt discount/(premium)	0
Total	101,670
SOR Merger | Atlanta Perimeter | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	(3,656)
SOR Merger | Herndon
Real Estate Properties [Line Items]
Land	9,667
Building and improvements	66,303
Tenant origination and absorption cost	7,794
Debt discount/(premium)	0
Total	87,300
SOR Merger | Herndon | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	3,536
SOR Merger | Deerfield
Real Estate Properties [Line Items]
Land	4,339
Building and improvements	30,367
Tenant origination and absorption cost	6,931
Debt discount/(premium)	0
Total	42,900
SOR Merger | Deerfield | In-place lease valuation - above/(below) market
Real Estate Properties [Line Items]
Finite-lived intangibles	$ 1,263

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Real Estate - Pro Forma Information (Details) - LTI Property - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Business Acquisition [Line Items]
Revenue	$ 345,092	$ 318,720
Net income	63,170	49,499
Net income attributable to noncontrolling interests	1,259	979
Distributions to redeemable noncontrolling interests attributable to common stockholders	(359)	(355)
Net loss attributable to common stockholders	$ 42,402	$ 29,154
Net income (loss) attributable to common stockholders per share, basic and diluted (in USD per share)	$ 0.24	$ 0.19

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Real Estate - Future Minimum Contractual Rent Payments (Details) $ in Thousands	Dec. 31, 2015 USD ($)
Schedule of future minimum net rent payments
2016	$ 254,246
2017	253,976
2018	246,264
2019	215,126
2020	189,114
Thereafter	1,001,398
Total	$ 2,160,124

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Real Estate - Real Estate Held For Sale, Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Property, Plant and Equipment [Line Items]
Real estate assets and other assets held for sale, net	$ 68,792	$ 96,862
Total liabilities	2,845	3,906
Held-for-sale
Property, Plant and Equipment [Line Items]
Restricted cash	561	1,450
Total Real Estate	70,908	98,556
Less: accumulated depreciation and amortization	(7,034)	(7,893)
Real estate held for sale	63,874	90,663
In-place lease valuation - above market	813	813
Deferred rent	2,716	2,135
Other assets	829	1,801
Real estate assets and other assets held for sale, net	68,793	96,862
Accounts payable and other liabilities	2,203	2,763
Due to affiliates	81	104
Restricted reserve	561	1,039
Total liabilities	2,845	3,906
Held-for-sale | Land
Property, Plant and Equipment [Line Items]
Real estate held for sale	8,025	10,256
Held-for-sale | Building
Property, Plant and Equipment [Line Items]
Real estate held for sale	42,858	66,629
Held-for-sale | Tenant origination and absorption cost
Property, Plant and Equipment [Line Items]
Real estate held for sale	20,003	21,400
Held-for-sale | Construction in progress
Property, Plant and Equipment [Line Items]
Real estate held for sale	$ 22	$ 271

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Real Estate - Real Estate Held For Sale, Included in Income (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Real Estate [Abstract]
Total revenues	$ 12,128	$ 13,231	$ 5,254
Operating expenses	(6,368)	(8,306)	(4,189)
Total revenues less operating expenses from assets classified as held for sale, not qualifying as discontinued operations	5,760	4,925	1,065
Depreciation and amortization expense	(2,554)	(8,156)	(2,041)
Interest expense	0	(907)	(170)
Income (loss) from assets classified as held for sale, not qualifying as discontinued operations	$ 3,206	$ (4,138)	$ (1,146)

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Real Estate - Intangibles (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Real Estate [Abstract]
In-place lease valuation (above market)	$ 45,413	$ 26,289
In-place lease valuation (above market) - accumulated amortization	(10,844)	(4,896)
In-place lease valuation (above market), net	34,569	21,393
Ground leasehold interest (below market)	2,254	2,254
Ground leasehold interest (below market) - accumulated amortization	(54)	(26)
Ground leasehold interest (below market), net	2,200	2,228
Intangible assets, net	36,769	23,621
In-place lease valuation (below market)	(55,774)	(48,448)
In-place lease valuation (below market) - accumulated amortization	14,068	8,054
In-place lease valuation (below market), net	(41,706)	(40,394)
Tenant origination and absorption cost	516,879	359,416
Tenant origination and absorption cost - accumulated amortization	(119,593)	(58,679)
Tenant origination and absorption cost, net	$ 397,286	$ 300,737

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Real Estate - Amortization of Intangible Assets and Other Leasing Costs (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Schedule of amortization expense
In-place lease valuation	$ (3,785)	$ (468)	$ (546)
Tenant origination and absorption cost	69,099	45,044	14,098
Ground leasehold amortization (below market)	28	26	0
Other leasing costs amortization	$ 301	$ 143	$ 0

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Real Estate - Estimated Annual Amortization (Details) $ in Thousands	Dec. 31, 2015 USD ($)
Future In-place Lease [Abstract]
2016	$ 1,028
2017	495
2018	(226)
2019	(1,990)
2020	(1,228)
Future Tenant Origination and Absorption Cost [Abstract]
2016	63,111
2017	60,293
2018	53,948
2019	44,201
2020	35,109
Future Ground Leasehold Improvements [Abstract]
2016	28
2017	28
2018	28
2019	28
2020	28
Future Other Leasing Costs [Abstract]
2016	1,000
2017	1,229
2018	1,481
2019	1,481
2020	$ 1,457

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Real Estate - Ongoing Replacement Reserve (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2015 USD ($) property
Restricted Cash [Roll Forward]
Balance December 31, 2014	$ 40,752
Balance December 31, 2015	$ 24,187
Number of rented properties serve as collateral | property	8
Real estate asset acquisitions and contributions
Restricted Cash [Roll Forward]
Balance December 31, 2014	$ 40,752
Additions	13,628
Deductions	(30,193)
Balance December 31, 2015	24,187
Tenant Improvement Reserves | Real estate asset acquisitions and contributions
Restricted Cash [Roll Forward]
Balance December 31, 2014	36,931
Additions	1,904
Deductions	(25,942)
Balance December 31, 2015	12,893
Midland Mortgage Loan Reserves | Real estate asset acquisitions and contributions
Restricted Cash [Roll Forward]
Balance December 31, 2014	453
Additions	0
Deductions	0
Balance December 31, 2015	453
Real Estate Tax Reserves | Real estate asset acquisitions and contributions
Restricted Cash [Roll Forward]
Balance December 31, 2014	1,074
Additions	2,601
Deductions	(1,784)
Balance December 31, 2015	1,891
Property Insurance Reserves | Real estate asset acquisitions and contributions
Restricted Cash [Roll Forward]
Balance December 31, 2014	251
Additions	494
Deductions	(444)
Balance December 31, 2015	301
Deposits | Real estate asset acquisitions and contributions
Restricted Cash [Roll Forward]
Balance December 31, 2014	20
Additions	0
Deductions	0
Balance December 31, 2015	20
Midland Mortgage Loan Restricted Lockbox | Real estate asset acquisitions and contributions
Restricted Cash [Roll Forward]
Balance December 31, 2014	2,023
Additions	2,044
Deductions	(2,023)
Balance December 31, 2015	2,044
Restricted Rent Receipts | Real estate asset acquisitions and contributions
Restricted Cash [Roll Forward]
Balance December 31, 2014	0
Additions	6,585
Deductions	0
Balance December 31, 2015	$ 6,585
Midland Mortgage loan
Restricted Cash [Roll Forward]
Number of rented properties serve as collateral | property	8

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Investments - Narrative (Details) ft² in Thousands, $ in Thousands						12 Months Ended
	Sep. 09, 2014 USD ($) ft²	Jun. 20, 2014 USD ($)	Jun. 16, 2014 USD ($) ft²	Apr. 12, 2013 exchange_right	Apr. 10, 2013 USD ($) building	Dec. 31, 2015 USD ($)	Dec. 31, 2014 USD ($)	Dec. 31, 2013 USD ($)
Gain (Loss) on Investments [Line Items]
Other comprehensive loss						$ (6,560)
Investments in unconsolidated entities						56,863	$ 66,249
Payments to acquire land						0	7,529	$ 0
Redemption value of noncontrolling interest						$ 18,100
Carrying value of noncontrolling interest			$ 7,700
Total
Gain (Loss) on Investments [Line Items]
Number of buildings | building					2
Payments to acquire building					$ 36,400
Liability and equity of equity method investment					39,600
Noncurrent liabilities of equity method investment					23,600
Equity of equity method investments					$ 16,000
Operating lease term					9 years
Ownership percentage				10.00%
Investment discount on offering expense				10.00%
Right to acquire beneficial interest | exchange_right				2
Minimum holding period for redemption of stock				1 year
Minimum holding period for exercise of secondary exchange rights				5 years
Investors electing for company units						73.00%
Investors electing for cash						27.00%
Investments in unconsolidated entities						$ 56,863	66,249
Digital Realty Joint Venture
Gain (Loss) on Investments [Line Items]
Noncurrent liabilities of equity method investment	$ 102,000
Operating lease term	7 years
Ownership percentage	80.00%					80.00%
Additions	$ 68,400
Noncurrent assets of equity method investments	$ 187,500
Area of equity method investments (in sqft) | ft²	132
Investments in unconsolidated entities						$ 55,572	$ 64,898
WR Griffin Patterson, LLC
Gain (Loss) on Investments [Line Items]
Operating lease term			15 years
Area of equity method investments (in sqft) | ft²			1,500
Payments to acquire land		$ 15,200
Accumulated Other Comprehensive Loss
Gain (Loss) on Investments [Line Items]
Other comprehensive loss						(6,416)
Accumulated Other Comprehensive Loss | Digital Realty Joint Venture
Gain (Loss) on Investments [Line Items]
Other comprehensive loss						$ (200)

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Investments - Share of Earnings and Losses of Investments (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2015 USD ($)
Gain (Loss) on Investments [Line Items]
Balance December 31, 2014	$ 66,249
Balance December 31, 2015	56,863
HealthSpring DST
Gain (Loss) on Investments [Line Items]
Balance December 31, 2014	1,351
Other comprehensive loss	0
Net income (loss)	35
Distributions	(95)
Balance December 31, 2015	1,291
Digital Realty Joint Venture
Gain (Loss) on Investments [Line Items]
Balance December 31, 2014	64,898
Other comprehensive loss	(189)
Net income (loss)	(1,510)
Distributions	(7,627)
Balance December 31, 2015	55,572
Total
Gain (Loss) on Investments [Line Items]
Balance December 31, 2014	66,249
Other comprehensive loss	(189)
Net income (loss)	(1,475)
Distributions	(7,722)
Balance December 31, 2015	$ 56,863

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Investments - Consolidated Interest of WR Griffin (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Gain (Loss) on Investments [Line Items]
Deferred rent	$ 26,432	$ 15,619
Construction in progress	4,805	35,650
Land	355,443	250,078
Due to affiliates	(8,757)	(1,851)
Total investment	1,287,769	973,507
Advisor
Gain (Loss) on Investments [Line Items]
Due to affiliates	(3,000)
WR Griffin Patterson, LLC | Variable Interest Entity, Primary Beneficiary
Gain (Loss) on Investments [Line Items]
Cash on hand	4,711	6,985
Deferred rent	372	0
Other assets	59	0
Construction in progress	0	70
Leasing commissions, net	731	375
Land	15,463	15,185
Building	57,595	0
Tenant improvements	18,040	0
Accumulated depreciation	(1,314)	0
Construction in progress payable	0	(13,423)
Accounts payable and other liabilities	(21,979)	0
Due to affiliates	(3,324)	0
Noncontrolling interest	0	(7,656)
Total investment	70,354	36,275
WR Griffin Patterson, LLC | Variable Interest Entity, Primary Beneficiary | Corporate Joint Venture
Gain (Loss) on Investments [Line Items]
Construction in progress	$ 0	$ 34,739

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Debt - Schedule of Debt (Details) - USD ($)		12 Months Ended
	Jul. 20, 2015	Dec. 31, 2015	Dec. 11, 2015	Jul. 09, 2015	Dec. 31, 2014
Debt Instrument [Line Items]
Mortgage Loan Total		$ 364,673,000			$ 325,696,000
Total		1,486,326,000			625,696,000
Interest Rate Swap One
Debt Instrument [Line Items]
Derivative, notional amount		$ 425,000,000.0		$ 425,000,000.0
Minimum
Debt Instrument [Line Items]
Weighted average interest rate of the fixed-rate debt		2.80%
Maximum
Debt Instrument [Line Items]
Weighted average interest rate of the fixed-rate debt		3.80%
Key Bank Credit Facility
Debt Instrument [Line Items]
LIBOR Rate		0.30%
Plainfield mortgage loan
Debt Instrument [Line Items]
Mortgage Loan Total		$ 19,295,000			19,638,000
Interest rate on debt		6.65%
Emporia Partners mortgage loan
Debt Instrument [Line Items]
Mortgage Loan Total		$ 3,753,000			4,108,000
Interest rate on debt		5.88%
LTI mortgage loan
Debt Instrument [Line Items]
Mortgage Loan Total		$ 0			32,128,000
Interest rate on debt		5.80%
LTI mortgage loan premium
Debt Instrument [Line Items]
Mortgage Loan Total		$ 0			102,000
TransDigm mortgage loan
Debt Instrument [Line Items]
Mortgage Loan Total		$ 6,432,000			6,576,000
Interest rate on debt		5.98%
TransDigm mortgage loan premium
Debt Instrument [Line Items]
Mortgage Loan Total		$ 22,000			75,000
Ace Hardware mortgage loan
Debt Instrument [Line Items]
Mortgage Loan Total		$ 23,294,000			23,648,000
Interest rate on debt		5.588%
Ace Hardware mortgage loan premium
Debt Instrument [Line Items]
Mortgage Loan Total		$ 1,508,000			1,681,000
Highway 94 mortgage loan
Debt Instrument [Line Items]
Mortgage Loan Total		$ 18,968,000			0
Interest rate on debt		3.75%
Highway 94 mortgage loan discount
Debt Instrument [Line Items]
Mortgage Loan Total		$ (2,210,000)			0
DynCorp mortgage loan
Debt Instrument [Line Items]
Mortgage Loan Total		$ 11,162,000	$ 11,200,000		0
Interest rate on debt		4.70%	4.70%
Mercedes-Benz mortgage loan
Debt Instrument [Line Items]
Mortgage Loan Total		$ 18,945,000	$ 18,900,000		0
Interest rate on debt		6.018%	6.018%
Samsonite mortgage loan
Debt Instrument [Line Items]
Mortgage Loan Total		$ 24,561,000	$ 24,600,000		0
Interest rate on debt		6.08%	6.08%
Samsonite mortgage loan premium
Debt Instrument [Line Items]
Mortgage Loan Total		$ 1,490,000			0
Midland Mortgage loan
Debt Instrument [Line Items]
Mortgage Loan Total		$ 105,600,000			105,600,000
Interest rate on debt		3.94%
AIG loan
Debt Instrument [Line Items]
Mortgage Loan Total		$ 110,640,000			110,640,000
Interest rate on debt		4.96%
TW Telecom loan
Debt Instrument [Line Items]
Mortgage Loan Total		$ 21,213,000			21,500,000
TW Telecom loan | LIBOR
Debt Instrument [Line Items]
Interest rate on the credit facility		2.45%
Unsecured term loan (May 2014)
Debt Instrument [Line Items]
Total		$ 0			300,000,000
Unsecured term loan (May 2014) | LIBOR
Debt Instrument [Line Items]
Interest rate on the credit facility		1.45%
Term Loan (July 2015)
Debt Instrument [Line Items]
Total		$ 640,000,000			0
Term Loan (July 2015) | LIBOR
Debt Instrument [Line Items]
Interest rate on the credit facility		1.25%
Revolver Loan (July 2015)
Debt Instrument [Line Items]
Total		$ 481,653,000			$ 0
Revolver Loan (July 2015) | LIBOR
Debt Instrument [Line Items]
Interest rate on the credit facility		1.30%
Unsecured Credit Facility (July 2015) | Revolving Credit Facility
Debt Instrument [Line Items]
Term of debt instrument	4 years
Extended term on debt	1 year

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Debt - Maturity of Debt (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Summary of future principal repayments of all loans
2016	$ 40,078
2017	22,237
2018	7,077
2019	25,153
2020	1,128,486
Thereafter	262,485
Total principal	1,485,516
Unamortized debt premium	810	$ 1,858
Total debt	$ 1,486,326	$ 625,696

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Debt - Narrative - USD ($)	Jul. 20, 2015	Dec. 31, 2015	Dec. 11, 2015	Dec. 31, 2014
Line of Credit Facility [Line Items]
Mortgage Loan Total		$ 364,673,000		$ 325,696,000
Unamortized debt premium		810,000		1,858,000
Highway 94 mortgage loan
Line of Credit Facility [Line Items]
Mortgage Loan Total		$ 18,968,000		0
Interest rate on debt		3.75%
DynCorp mortgage loan
Line of Credit Facility [Line Items]
Mortgage Loan Total		$ 11,162,000	$ 11,200,000	0
Interest rate on debt		4.70%	4.70%
Mercedes-Benz mortgage loan
Line of Credit Facility [Line Items]
Mortgage Loan Total		$ 18,945,000	$ 18,900,000	0
Interest rate on debt		6.018%	6.018%
Samsonite mortgage loan
Line of Credit Facility [Line Items]
Mortgage Loan Total		$ 24,561,000	$ 24,600,000	0
Interest rate on debt		6.08%	6.08%
TransDigm, Ace Hardware, Highway 94, and Samsonite Mortgage Loan
Line of Credit Facility [Line Items]
Unamortized debt premium		$ 800,000		$ 1,900,000
Line of Credit | Unsecured Credit Facility (July 2015)
Line of Credit Facility [Line Items]
Line of credit facility maximum borrowing capacity	$ 1,140,000,000.00
Line of Credit | Unsecured Credit Facility (July 2015) | Federal Funds Effective Swap Rate
Line of Credit Facility [Line Items]
Interest rate on the credit facility	0.50%
Revolving Credit Facility | Unsecured Credit Facility (July 2015)
Line of Credit Facility [Line Items]
Line of credit facility maximum borrowing capacity	$ 500,000,000.0
Additional capacity option	860,000,000.0
Minimum increment increase to borrowing capacity	50,000,000.0
Increase limit on borrowing capacity	$ 2,000,000,000.0
Term of debt instrument	4 years
Extended term on debt	1 year
Unsecured Debt
Line of Credit Facility [Line Items]
Deferred finance cost		$ 4,100,000
Unsecured Debt | Unsecured Credit Facility (July 2015)
Line of Credit Facility [Line Items]
Line of credit facility maximum borrowing capacity	$ 640,000,000.0
Term of debt instrument	4 years
Extended term on debt	1 year
Revolver Loan (July 2015) | Unsecured Credit Facility (July 2015)
Line of Credit Facility [Line Items]
Term of debt instrument	5 years

XML

Interest Rate Contracts - Narrative (Details)	12 Months Ended
	Dec. 31, 2015 USD ($)	Jul. 09, 2015 USD ($) contract	Dec. 31, 2014 USD ($)
Derivative [Line Items]
Number of derivative instruments held | contract		3
Amount expected to be reclassified next 12 months	$ 6,500,000
Effective portion of change in fair value of derivatives reported in AOCI	3,100,000
Loss on fair value hedge ineffectiveness, less than	100,000.0
Interest rate swap liability	6,394,000		$ 0
Interest Rate Swap One
Derivative [Line Items]
Derivative, notional amount	$ 425,000,000.0	$ 425,000,000.0
Interest Rate Swap Two
Derivative [Line Items]
Derivative, notional amount		300,000,000.0
Interest Rate Swap Three
Derivative [Line Items]
Derivative, notional amount		$ 100,000,000.0

XML

Interest Rate Contracts - Summary of Interest Rate Swaps (Details) - USD ($)	Dec. 31, 2015	Dec. 31, 2014
Derivative [Line Items]
Interest rate swap liability	$ (6,394,000)	$ 0
Interest Rate Swap Effective Date July 9, 2015
Derivative [Line Items]
Strike rate	1.687%
Interest rate swap liability	$ (4,305,000)
Notional amount	$ 425,000,000
Interest Rate Swap Effective Date January 1, 2016
Derivative [Line Items]
Strike rate	1.32%
Interest rate swap liability	$ (1,605,000)
Notional amount	$ 0
Interest Rate Swap Effective Date July, 1 2016
Derivative [Line Items]
Strike rate	1.495%
Interest rate swap liability	$ (484,000)
Notional amount	$ 0

XML

Fair Value Measurements - Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Liabilities	$ (6,394)	$ 0
Interest Rate Swap | Recurring basis
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Liabilities	(6,394)
Quoted Prices in Active Markets for Identical Assets and Liabilities | Interest Rate Swap | Recurring basis
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Liabilities	0
Significant Other Observable Inputs | Interest Rate Swap | Recurring basis
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Liabilities	(6,394)
Significant Unobservable Inputs | Interest Rate Swap | Recurring basis
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Liabilities	$ 0

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Fair Value Measurements - Financial Instruments at Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 11, 2015	Dec. 31, 2014
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage Loan Total	$ 364,673		$ 325,696
Unamortized debt premium	810		1,858
Plainfield Mortgage Loan
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage Loan Total	19,295		19,638
Plainfield Mortgage Loan | Significant Unobservable Inputs
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value	20,240		20,994
Emporia Partners mortgage loan
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage Loan Total	3,753		4,108
Emporia Partners mortgage loan | Significant Unobservable Inputs
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value	3,742		4,434
LTI mortgage loan
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage Loan Total	0		32,128
LTI mortgage loan | Significant Unobservable Inputs
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value	0		32,742
TransDigm Mortgage Loan
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage Loan Total	6,432		6,576
TransDigm Mortgage Loan | Significant Unobservable Inputs
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value	6,432		6,748
Ace Hardware mortgage loan
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage Loan Total	23,294		23,648
Ace Hardware mortgage loan | Significant Unobservable Inputs
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value	23,778		26,424
Midland Mortgage loan
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage Loan Total	105,600		105,600
Midland Mortgage loan | Significant Unobservable Inputs
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value	107,154		105,155
AIG loan
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage Loan Total	110,640		110,640
AIG loan | Significant Unobservable Inputs
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value	114,747		122,062
Highway 94 mortgage loan
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage Loan Total	18,968		0
Highway 94 mortgage loan | Significant Unobservable Inputs
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value	17,658		0
DynCorp mortgage loan
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage Loan Total	11,162	$ 11,200	0
DynCorp mortgage loan | Significant Unobservable Inputs
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value	11,162		0
Mercedes-Benz mortgage loan
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage Loan Total	18,945	18,900	0
Mercedes-Benz mortgage loan | Significant Unobservable Inputs
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value	18,945		0
Samsonite mortgage loan
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Mortgage Loan Total	24,561	$ 24,600	0
Samsonite mortgage loan | Significant Unobservable Inputs
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair Value	26,044		0
TransDigm, Ace Hardware, Highway 94, and Samsonite Mortgage Loan
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Unamortized debt premium	$ 800		$ 1,900

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Equity - Narrative (Details)			12 Months Ended			33 Months Ended
	Nov. 05, 2015 USD ($)	May. 14, 2015 USD ($)	Dec. 31, 2015 USD ($) property Request $ / shares shares	Dec. 31, 2014 USD ($) Request shares	Dec. 31, 2013 USD ($) shares	Dec. 31, 2015 USD ($) property Request $ / shares shares	Oct. 22, 2015 $ / shares	Nov. 05, 2013 USD ($) property shares	Dec. 31, 2012 shares	Aug. 28, 2008 shares
Preferred Equity
Number of properties | property			74			74		18
Common Equity
Common stock, number of shares outstanding (in shares) | shares			175,184,519	129,763,016		175,184,519				100
Share price (in USD per share) | $ / shares							$ 10.40
Value of shares issued				$ 776,607,000	$ 365,650,000
Repurchase of common stock			$ 13,819,000	2,560,000	$ 614,000
Common stock subject to redemption (in shares)			$ 6,300,000	$ 1,200,000		$ 6,300,000
Noncontrolling Interests
Percentage of noncontrolling interests based on total shares			3.00%			3.00%
Percentage of noncontrolling interests based on weighted average shares			3.00%			3.00%
Partnership unit exchange in share | shares			1
Number of redemption requests | Request			0	0		0
Maximum
Noncontrolling Interests
Percentage of noncontrolling interests based on total shares			100.00%			100.00%
Share Redemption Program
Common Equity
Prior notice period to terminate plan			30 days
Stock redeemed during period (in shares) | shares						1,753,700
Repurchase of common stock						$ 17,300,000
Shares subject to redemption requests | shares			638,483			638,483
Common stock subject to redemption (in shares)			$ 6,300,000			$ 6,300,000
Share Redemption Program | Maximum
Common Equity
Maximum redemption percentage of weighted average shares outstanding			5.00%
Share Redemption Program | Weighted Average
Common Equity
Share price (in USD per share) | $ / shares			$ 9.88			$ 9.88
Affiliated Entity
Noncontrolling Interests
Operating Partnership issued in exchange for certain properties			$ 5,500,000
Unaffiliated Entity
Noncontrolling Interests
Operating Partnership issued in exchange for certain properties			$ 100,000
Common Stock
Common Equity
Common stock, number of shares outstanding (in shares) | shares			175,184,519	129,763,016	49,893,502	175,184,519			13,376,868
Adjustment to APIC for common stock par			$ 1,217,000
Value of shares issued				$ 776,000	$ 366,000
Repurchase of common stock			4,000	3,000	1,000
Additional Paid-In Capital
Common Equity
Adjustment to APIC for common stock par			(1,217,000)
Value of shares issued				775,831,000	365,285,000
Repurchase of common stock			13,815,000	2,557,000	$ 614,000
Private Offering
Common Equity
Proceeds from issuance of private placement			$ 1,400,000,000
Distribution Reinvestment Plan (IPO)
Common Equity
Prior notice period to terminate plan			10 days
Distribution Reinvestment Plan
Common Equity
Value of shares issued			$ 110,200,000	$ 57,700,000
Series A Cumulative Exchangeable Preferred Units | SPT Griffin Holdings, LLC (Starwood) | Multi-State Portfolio 2013
Preferred Equity
Amount of equity investment in Operating Partnership								$ 250,000,000.0
Number of preferred units issued in return for investment | shares								24,319,066
Stock redeemed, value	$ 64,100,000	$ 191,600,000

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Equity - Share Redemption (Details)	Mar. 17, 2013 $ / shares
Summary of Redemption Price Per Share [Abstract]
At least one year	$ 9.25
At least two years	9.50
At least three years	9.75
At least four years	$ 10.28

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Equity - Noncontrolling Interest (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Schedule of activity for noncontrolling interests
Contribution/issuance of noncontrolling interests	$ 7,282	$ 1,364	$ 8,334
Distributions to noncontrolling interests	(3,150)	(3,050)	(2,730)
Allocated distributions to noncontrolling interests subject to redemption	(10)	(14)	(49)
Net loss	(3,888)	(19,775)	(27,756)
Other comprehensive loss	(6,560)
Non-controlling Interests
Schedule of activity for noncontrolling interests
Beginning balance	17,478	19,736	17,512
Contribution/issuance of noncontrolling interests	7,282	1,504	8,095
Distributions to noncontrolling interests	(3,150)	(3,050)	(2,730)
Allocated distributions to noncontrolling interests subject to redemption	(10)	(14)	(49)
Net loss	(138)	(698)	(3,092)
Other comprehensive loss	(144)	0	0
Ending balance	$ 21,318	$ 17,478	$ 19,736

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Related Party Transactions - Schedule of Related Party Transactions (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2015 USD ($)
Due to Related Parties [Roll Forward]
Beginning Balance	$ 1,851
Incurred	65,518
Paid	58,612
Ending Balance	8,757
Acquisition fees and expenses
Due to Related Parties [Roll Forward]
Beginning Balance	0
Incurred	35,210
Paid	32,245
Ending Balance	2,965
Operating expenses
Due to Related Parties [Roll Forward]
Beginning Balance	202
Incurred	3,713
Paid	1,738
Ending Balance	2,177
Asset management fees
Due to Related Parties [Roll Forward]
Beginning Balance	1,189
Incurred	18,753
Paid	17,818
Ending Balance	2,124
Property management fees
Due to Related Parties [Roll Forward]
Beginning Balance	460
Incurred	7,149
Paid	6,411
Ending Balance	1,198
Disposition fees
Due to Related Parties [Roll Forward]
Beginning Balance	0
Incurred	640
Paid	353
Ending Balance	287
Costs advanced by the Advisor
Due to Related Parties [Roll Forward]
Beginning Balance	0
Incurred	53
Paid	47
Ending Balance	6
Asset management fees related to real estate held for sale
Due to Related Parties [Roll Forward]
Beginning Balance	65
Incurred	636
Paid	657
Ending Balance	44
Property management fees related to real estate held for sale
Due to Related Parties [Roll Forward]
Beginning Balance	39
Incurred	473
Paid	475
Ending Balance	37
Total
Due to Related Parties [Roll Forward]
Beginning Balance	1,955
Incurred	66,627
Paid	59,744
Ending Balance	8,838
Highway 94 | Acquisition fees and expenses
Due to Related Parties [Roll Forward]
Incurred	$ 3,000

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Related Party Transactions - Narrative (Details)		12 Months Ended
	Oct. 09, 2015 USD ($) ft²	Dec. 31, 2015 USD ($) property	Dec. 31, 2014 USD ($)
Related Party Transaction [Line Items]
Percentage of organizational and offering costs		15.00%
Percentage of gross proceeds reimbursed from organizational and offering costs		3.50%
Reimbursement of organization and offering expenses percentage		3.50%
Organization and offering expenses gross offering percentage		15.00%
Number of days after primary public offering		60 days
Percentage of acquisition fees		2.50%
Percent reimbursed		0.50%
Percentage of purchase price of properties		0.60%
Percentage of contract purchase price		6.00%
Disposition fee, percent of contract sales price		3.00%
Disposition fee, percent of competitive commission		50.00%
Disposition fee, percent of aggregate contract sales price		6.00%
Asset management fee percentage of average invested assets		0.75%
Average invested assets percentage		2.00%
Sales revenue goods percentage		25.00%
Operating expenses		$ 65,518,000
Property management fees percentage		3.00%
Gross revenue percentage		1.00%
Construction management fee percentage		5.00%
Number of real estate | property		11
Subsidiary of Common Parent
Related Party Transaction [Line Items]
Aggregate assets required for investment opportunity		$ 500,000,000
Minimum
Related Party Transaction [Line Items]
Amount for investment opportunity		75,000,000
Maximum | Subsidiary of Common Parent
Related Party Transaction [Line Items]
Amount for investment opportunity		35,000,000
Receivable with Affiliated Tenant-in-common or LLC
Related Party Transaction [Line Items]
Mortgage note to related party	$ 26,000,000
Net rentable area (in sqft) | ft²	127,246
Interest rate on mortgage note receivable	8.00%
Griffin Capital Essential Asset Advisor, LLC
Related Party Transaction [Line Items]
Operating expenses		$ 1,600,000	$ 1,000,000
Griffin Capital Essential Asset Advisor, LLC | Compensation, Subordinated Share of Net Sale Proceeds | Affiliated Entity
Related Party Transaction [Line Items]
Determination of compensation, minimum required cumulative, non-compounded return to shareholders, percentage		6.00%
Compensation rate, cumulative, non-compounded return to shareholders, range one, percentage		5.00%
Compensation rate, cumulative, non-compounded return to shareholders, range two, percentage		10.00%
Determination of compensation, cumulative, non-compounded return to shareholders, range three, percentage		10.00%
Compensation rate, cumulative, non-compounded return to shareholders, range three, percentage		15.00%
Griffin Capital Essential Asset Advisor, LLC | Compensation, Subordinated Share of Net Sale Proceeds | Minimum | Affiliated Entity
Related Party Transaction [Line Items]
Determination of compensation, cumulative, non-compounded return to shareholders, range one, percentage		6.00%
Determination of compensation, cumulative, non-compounded return to shareholders, range two, percentage		8.00%
Griffin Capital Essential Asset Advisor, LLC | Compensation, Subordinated Share of Net Sale Proceeds | Maximum | Affiliated Entity
Related Party Transaction [Line Items]
Determination of compensation, cumulative, non-compounded return to shareholders, range one, percentage		8.00%
Determination of compensation, cumulative, non-compounded return to shareholders, range two, percentage		10.00%
Griffin Capital Essential Asset Advisor, LLC | Compensation, Subordinated Incentive Listing Distribution | Affiliated Entity
Related Party Transaction [Line Items]
Determination of compensation, minimum required cumulative, non-compounded return to shareholders, percentage		6.00%
Compensation rate, cumulative, non-compounded return to shareholders, range one, percentage		5.00%
Compensation rate, cumulative, non-compounded return to shareholders, range two, percentage		10.00%
Determination of compensation, cumulative, non-compounded return to shareholders, range three, percentage		10.00%
Compensation rate, cumulative, non-compounded return to shareholders, range three, percentage		15.00%
Compensation payable, number of trading days		30 days
Griffin Capital Essential Asset Advisor, LLC | Compensation, Subordinated Incentive Listing Distribution | Minimum | Affiliated Entity
Related Party Transaction [Line Items]
Determination of compensation, cumulative, non-compounded return to shareholders, range one, percentage		6.00%
Determination of compensation, cumulative, non-compounded return to shareholders, range two, percentage		8.00%
Compensation payable, distribution period		7 months
Compensation payable, 30 day commencement period		6 months
Griffin Capital Essential Asset Advisor, LLC | Compensation, Subordinated Incentive Listing Distribution | Maximum | Affiliated Entity
Related Party Transaction [Line Items]
Determination of compensation, cumulative, non-compounded return to shareholders, range one, percentage		8.00%
Determination of compensation, cumulative, non-compounded return to shareholders, range two, percentage		10.00%
Compensation payable, distribution period		19 months
Compensation payable, 30 day commencement period		18 months
Griffin Capital Essential Asset Advisor, LLC | Compensation, Subordinated Distribution Due Upon Termination | Affiliated Entity
Related Party Transaction [Line Items]
Determination of compensation, minimum required cumulative, non-compounded return to shareholders, percentage		6.00%
Compensation rate, cumulative, non-compounded return to shareholders, range one, percentage		5.00%
Compensation rate, cumulative, non-compounded return to shareholders, range two, percentage		10.00%
Determination of compensation, cumulative, non-compounded return to shareholders, range three, percentage		10.00%
Compensation rate, cumulative, non-compounded return to shareholders, range three, percentage		15.00%
Compensation payable, percent owed within first 30 days		33.33%
Compensation payable, termination date range one		30 days
Compensation payable, percent owed at one year anniversary		33.33%
Compensation payable, termination date range two		1 year
Compensation payable, percent owed at two year anniversary		33.33%
Compensation payable, termination date range three		2 years
Griffin Capital Essential Asset Advisor, LLC | Compensation, Subordinated Distribution Due Upon Termination | Minimum | Affiliated Entity
Related Party Transaction [Line Items]
Determination of compensation, cumulative, non-compounded return to shareholders, range one, percentage		6.00%
Determination of compensation, cumulative, non-compounded return to shareholders, range two, percentage		8.00%
Griffin Capital Essential Asset Advisor, LLC | Compensation, Subordinated Distribution Due Upon Termination | Maximum | Affiliated Entity
Related Party Transaction [Line Items]
Determination of compensation, cumulative, non-compounded return to shareholders, range one, percentage		8.00%
Determination of compensation, cumulative, non-compounded return to shareholders, range two, percentage		10.00%
Griffin Capital Essential Asset Advisor, LLC | Compensation, Subordinated Distribution Due Upon Extraordinary Transaction | Affiliated Entity
Related Party Transaction [Line Items]
Determination of compensation, minimum required cumulative, non-compounded return to shareholders, percentage		6.00%
Compensation rate, cumulative, non-compounded return to shareholders, range one, percentage		5.00%
Compensation rate, cumulative, non-compounded return to shareholders, range two, percentage		10.00%
Determination of compensation, cumulative, non-compounded return to shareholders, range three, percentage		10.00%
Compensation rate, cumulative, non-compounded return to shareholders, range three, percentage		15.00%
Griffin Capital Essential Asset Advisor, LLC | Compensation, Subordinated Distribution Due Upon Extraordinary Transaction | Minimum | Affiliated Entity
Related Party Transaction [Line Items]
Determination of compensation, cumulative, non-compounded return to shareholders, range one, percentage		6.00%
Determination of compensation, cumulative, non-compounded return to shareholders, range two, percentage		8.00%
Griffin Capital Essential Asset Advisor, LLC | Compensation, Subordinated Distribution Due Upon Extraordinary Transaction | Maximum | Affiliated Entity
Related Party Transaction [Line Items]
Determination of compensation, cumulative, non-compounded return to shareholders, range one, percentage		8.00%
Determination of compensation, cumulative, non-compounded return to shareholders, range two, percentage		10.00%
Griffin Capital Corporation | Compensation, Subordinated Distribution Due Upon Extraordinary Transaction | Affiliated Entity
Related Party Transaction [Line Items]
Excess merger consideration, trading restriction on stock from date of receipt		1 year

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Commitments and Contingencies - Schedule of Commitments (Details) $ in Thousands	Dec. 31, 2015 USD ($)
Operating Leased Assets [Line Items]
2016	$ 254,246
2017	253,976
2018	246,264
2019	215,126
2020	189,114
Thereafter	1,001,398
Total	2,160,124
Ground Lease
Operating Leased Assets [Line Items]
2016	180
2017	198
2018	198
2019	198
2020	198
Thereafter	34,048
Total	$ 35,020

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Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Commitments and Contingencies Disclosure [Abstract]
Rent expense	$ 0.4	$ 0.4

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Declaration of Distributions - Narrative (Details) - $ / shares		3 Months Ended
	Dec. 16, 2015	Dec. 31, 2015
Declaration of Distributions [Abstract]
Dividends per share declared (in USD per share)	$ 0.001895902	$ 0.001901096

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Selected Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Summary of quarterly financial information
Total revenue	$ 90,470	$ 82,849	$ 61,563	$ 55,213	$ 54,486	$ 52,631	$ 47,285	$ 47,992	$ 290,095	$ 202,394	$ 68,916
Net income (loss)	12,170	4,005	(11,655)	11,101	4,883	381	(7,990)	2,740	15,621	14	(24,469)
Net income (loss) attributable to common stockholders	$ 9,999	$ 1,544	$ (21,409)	$ 6,116	$ (2)	$ (4,354)	$ (12,378)	$ (1,920)	$ (3,750)	$ (18,654)	$ (24,664)
Net (loss)/income per share (in dollars per share)	$ 0.06	$ 0.01	$ (0.15)	$ 0.05	$ (0.01)	$ (0.03)	$ (0.10)	$ (0.03)	$ (0.02)	$ (0.17)	$ (0.97)

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Subsequent Events - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions				3 Months Ended
	Mar. 04, 2016	Mar. 01, 2016	Dec. 16, 2015	Dec. 31, 2015
Subsequent Event [Line Items]
Dividends per share declared (in USD per share)			$ 0.001895902	$ 0.001901096
Subsequent Event
Subsequent Event [Line Items]
Number of shares issued	9,414,932
Proceeds from issuance of common stock	$ 96.0
Dividends per share declared (in USD per share)		$ 0.001895902

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Schedule III Real Estate and Accumulated Depreciation - Schedule III (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Real Estate Properties [Line Items]
Encumbrances	$ 363,863
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	355,443
Building and Improve-ments	2,449,128
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	93,503
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	355,443
Building and Improve-ments	2,542,631
Total	2,898,074	$ 1,823,895	$ 1,175,423	$ 328,342
Accumulated Depreciation	202,048	102,883	$ 42,806	$ 18,898
Unamortized debt premium	810	1,858
Total	1,486,326	625,696
Term Loan (July 2015)
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Total	640,000	0
Revolver Loan (July 2015)
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Total	481,653	$ 0
Operating Properties
Real Estate Properties [Line Items]
Encumbrances	363,863
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	339,980
Building and Improve-ments	2,449,128
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	17,791
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	339,980
Building and Improve-ments	2,466,919
Total	2,806,899
Accumulated Depreciation	$ 200,734
Plainfield | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Plainfield | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Plainfield | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 19,295
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	3,709
Building and Improve-ments	27,335
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	2,217
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	3,709
Building and Improve-ments	29,552
Total	33,261
Accumulated Depreciation	$ 8,750
Renfro | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Renfro | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Renfro | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 13,500
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	1,400
Building and Improve-ments	18,804
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	1,390
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	1,400
Building and Improve-ments	20,194
Total	21,594
Accumulated Depreciation	$ 5,394
Emporia Partners | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Emporia Partners | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Emporia Partners | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 3,753
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	274
Building and Improve-ments	7,567
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	274
Building and Improve-ments	7,567
Total	7,841
Accumulated Depreciation	$ 1,731
ITT | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
ITT | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
ITT | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 4,600
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,877
Building and Improve-ments	4,222
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	17
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,877
Building and Improve-ments	4,239
Total	7,116
Accumulated Depreciation	$ 1,444
Quad/Graphics | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Quad/Graphics | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Quad/Graphics | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 7,500
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	1,950
Building and Improve-ments	10,236
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	272
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	1,950
Building and Improve-ments	10,508
Total	12,458
Accumulated Depreciation	$ 1,931
AT&T | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
AT&T | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
AT&T | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 26,000
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	6,770
Building and Improve-ments	32,420
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	461
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	6,770
Building and Improve-ments	32,881
Total	39,651
Accumulated Depreciation	$ 5,786
Westinghouse | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Westinghouse | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Westinghouse | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 22,000
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,650
Building and Improve-ments	29,096
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,650
Building and Improve-ments	29,096
Total	31,746
Accumulated Depreciation	$ 4,022
TransDigm | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
TransDigm | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
TransDigm | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 6,432
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	3,773
Building and Improve-ments	9,030
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	3,773
Building and Improve-ments	9,030
Total	12,803
Accumulated Depreciation	$ 1,505
Travelers | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Travelers | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Travelers | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 9,500
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,600
Building and Improve-ments	13,500
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	468
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,600
Building and Improve-ments	13,968
Total	16,568
Accumulated Depreciation	$ 2,138
Zeller | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Zeller | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Zeller | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 9,000
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,674
Building and Improve-ments	13,229
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	651
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,674
Building and Improve-ments	13,880
Total	16,554
Accumulated Depreciation	$ 1,597
Northrop | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Northrop | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Northrop | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 10,800
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	1,300
Building and Improve-ments	16,188
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	1,300
Building and Improve-ments	16,188
Total	17,488
Accumulated Depreciation	$ 3,082
Health Net | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Health Net | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Health Net | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 13,500
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	4,182
Building and Improve-ments	18,072
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	4,182
Building and Improve-ments	18,072
Total	22,254
Accumulated Depreciation	$ 3,327
Comcast | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Comcast | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Comcast | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	3,146
Building and Improve-ments	22,826
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	174
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	3,146
Building and Improve-ments	23,000
Total	26,146
Accumulated Depreciation	$ 3,957
Boeing | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Boeing | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Boeing | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	3,000
Building and Improve-ments	9,000
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	102
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	3,000
Building and Improve-ments	9,102
Total	12,102
Accumulated Depreciation	$ 2,732
Schlumberger | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Schlumberger | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Schlumberger | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 30,060
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,800
Building and Improve-ments	47,752
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	145
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,800
Building and Improve-ments	47,897
Total	50,697
Accumulated Depreciation	$ 4,612
UTC | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
UTC | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
UTC | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 23,760
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	1,330
Building and Improve-ments	37,858
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	1,330
Building and Improve-ments	37,858
Total	39,188
Accumulated Depreciation	$ 3,987
Avnet | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Avnet | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Avnet | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 19,860
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	1,860
Building and Improve-ments	31,481
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	1,860
Building and Improve-ments	31,481
Total	33,341
Accumulated Depreciation	$ 3,230
Cigna | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Cigna | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Cigna | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	8,600
Building and Improve-ments	48,102
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	8,600
Building and Improve-ments	48,102
Total	56,702
Accumulated Depreciation	$ 4,922
Nokia | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Nokia | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Nokia | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	7,697
Building and Improve-ments	21,843
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	7,697
Building and Improve-ments	21,843
Total	29,540
Accumulated Depreciation	$ 1,828
Verizon | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Verizon | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Verizon | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 26,160
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	5,300
Building and Improve-ments	36,768
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	1,472
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	5,300
Building and Improve-ments	38,240
Total	43,540
Accumulated Depreciation	$ 5,082
Fox Head | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Fox Head | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Fox Head | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	3,672
Building and Improve-ments	23,230
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	3,672
Building and Improve-ments	23,230
Total	26,902
Accumulated Depreciation	$ 1,792
Coca-Cola Refreshments | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Coca-Cola Refreshments | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Coca-Cola Refreshments | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	5,000
Building and Improve-ments	50,227
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	40
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	5,000
Building and Improve-ments	50,267
Total	55,267
Accumulated Depreciation	$ 5,483
General Electric | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
General Electric | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
General Electric | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	5,050
Building and Improve-ments	51,396
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	114
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	5,050
Building and Improve-ments	51,510
Total	56,560
Accumulated Depreciation	$ 3,832
Atlanta Wildwood | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Atlanta Wildwood | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Atlanta Wildwood | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	4,189
Building and Improve-ments	23,414
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	114
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	4,189
Building and Improve-ments	23,528
Total	27,717
Accumulated Depreciation	$ 3,155
Community Insurance | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Community Insurance | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Community Insurance | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	1,177
Building and Improve-ments	22,323
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	1,177
Building and Improve-ments	22,323
Total	23,500
Accumulated Depreciation	$ 2,013
Anthem | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Anthem | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Anthem | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	850
Building and Improve-ments	8,892
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	850
Building and Improve-ments	8,892
Total	9,742
Accumulated Depreciation	$ 1,074
JPMorgan Chase | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
JPMorgan Chase | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
JPMorgan Chase | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	5,500
Building and Improve-ments	39,000
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	5,500
Building and Improve-ments	39,000
Total	44,500
Accumulated Depreciation	$ 3,386
IBM | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
IBM | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
IBM | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	4,750
Building and Improve-ments	32,769
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	341
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	4,750
Building and Improve-ments	33,110
Total	37,860
Accumulated Depreciation	$ 4,153
Aetna | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Aetna | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Aetna | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	3,000
Building and Improve-ments	12,330
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	185
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	3,000
Building and Improve-ments	12,515
Total	15,515
Accumulated Depreciation	$ 1,671
CHRISTUS Health | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
CHRISTUS Health | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
CHRISTUS Health | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	1,950
Building and Improve-ments	46,922
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	37
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	1,950
Building and Improve-ments	46,959
Total	48,909
Accumulated Depreciation	$ 4,738
Roush Industries | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Roush Industries | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Roush Industries | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	875
Building and Improve-ments	11,375
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	534
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	875
Building and Improve-ments	11,909
Total	12,784
Accumulated Depreciation	$ 2,326
Wells Fargo | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Wells Fargo | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Wells Fargo | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	3,100
Building and Improve-ments	26,348
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	359
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	3,100
Building and Improve-ments	26,707
Total	29,807
Accumulated Depreciation	$ 10,430
Shire Pharmaceuticals | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Shire Pharmaceuticals | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Shire Pharmaceuticals | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,925
Building and Improve-ments	18,935
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	25
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,925
Building and Improve-ments	18,960
Total	21,885
Accumulated Depreciation	$ 3,669
United HealthCare | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
United HealthCare | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
United HealthCare | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,920
Building and Improve-ments	23,510
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	44
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,920
Building and Improve-ments	23,554
Total	26,474
Accumulated Depreciation	$ 3,576
Northpointe Corporate Center II | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Northpointe Corporate Center II | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Northpointe Corporate Center II | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	1,109
Building and Improve-ments	6,066
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	4,575
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	1,109
Building and Improve-ments	10,641
Total	11,750
Accumulated Depreciation	$ 784
Comcast (Northpointe Corporate Center I) | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Comcast (Northpointe Corporate Center I) | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Comcast (Northpointe Corporate Center I) | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,292
Building and Improve-ments	16,930
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,292
Building and Improve-ments	16,930
Total	19,222
Accumulated Depreciation	$ 2,189
Farmers | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Farmers | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Farmers | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,750
Building and Improve-ments	17,106
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	51
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,750
Building and Improve-ments	17,157
Total	19,907
Accumulated Depreciation	$ 1,758
Caterpillar | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Caterpillar | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Caterpillar | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	6,000
Building and Improve-ments	46,511
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	6,000
Building and Improve-ments	46,511
Total	52,511
Accumulated Depreciation	$ 5,333
DigitalGlobe | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
DigitalGlobe | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
DigitalGlobe | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	8,600
Building and Improve-ments	83,400
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	8,600
Building and Improve-ments	83,400
Total	92,000
Accumulated Depreciation	$ 6,285
Waste Management | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Waste Management | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Waste Management | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	0
Building and Improve-ments	16,515
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	10
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	0
Building and Improve-ments	16,525
Total	16,525
Accumulated Depreciation	$ 1,511
BT Infonet | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
BT Infonet | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
BT Infonet | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	9,800
Building and Improve-ments	41,483
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	9,800
Building and Improve-ments	41,483
Total	51,283
Accumulated Depreciation	$ 3,394
Wyndham Worldwide | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Wyndham Worldwide | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Wyndham Worldwide | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	6,200
Building and Improve-ments	91,153
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	6,200
Building and Improve-ments	91,153
Total	97,353
Accumulated Depreciation	$ 4,860
Ace Hardware | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Ace Hardware | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Ace Hardware | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 23,294
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	6,900
Building and Improve-ments	33,945
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	6,900
Building and Improve-ments	33,945
Total	40,845
Accumulated Depreciation	$ 2,195
Equifax I | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Equifax I | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Equifax I | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	1,850
Building and Improve-ments	12,709
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	1,850
Building and Improve-ments	12,709
Total	14,559
Accumulated Depreciation	$ 1,119
American Express | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
American Express | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
American Express | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	15,000
Building and Improve-ments	45,893
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	15,000
Building and Improve-ments	45,893
Total	60,893
Accumulated Depreciation	$ 5,262
SoftBank | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
SoftBank | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
SoftBank | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	22,789
Building and Improve-ments	68,950
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	22,789
Building and Improve-ments	68,950
Total	91,739
Accumulated Depreciation	$ 11,744
Vanguard | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Vanguard | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Vanguard | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,230
Building and Improve-ments	31,062
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,230
Building and Improve-ments	31,062
Total	33,292
Accumulated Depreciation	$ 1,984
Parallon | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Parallon | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Parallon | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	1,000
Building and Improve-ments	16,772
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	1,000
Building and Improve-ments	16,772
Total	17,772
Accumulated Depreciation	$ 1,054
TW Telecom | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
TW Telecom | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
TW Telecom | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 21,213
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	11,097
Building and Improve-ments	35,817
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	583
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	11,097
Building and Improve-ments	36,400
Total	47,497
Accumulated Depreciation	$ 2,329
Equifax II | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Equifax II | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Equifax II | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,200
Building and Improve-ments	12,755
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,200
Building and Improve-ments	12,755
Total	14,955
Accumulated Depreciation	$ 775
Mason I (6) | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Mason I (6) | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Mason I (6) | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	4,777
Building and Improve-ments	18,489
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	4,777
Building and Improve-ments	18,489
Total	23,266
Accumulated Depreciation	$ 532
Wells Fargo | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Wells Fargo | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Wells Fargo | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,150
Building and Improve-ments	40,806
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,150
Building and Improve-ments	40,806
Total	42,956
Accumulated Depreciation	$ 1,683
GE Aviation | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
GE Aviation | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
GE Aviation | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	4,400
Building and Improve-ments	61,681
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	4,400
Building and Improve-ments	61,681
Total	66,081
Accumulated Depreciation	$ 2,730
Westgate III | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Westgate III | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Westgate III | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	3,209
Building and Improve-ments	75,937
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	3,209
Building and Improve-ments	75,937
Total	79,146
Accumulated Depreciation	$ 2,112
Lisle | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Lisle | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Lisle | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,788
Building and Improve-ments	16,200
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	33
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,788
Building and Improve-ments	16,233
Total	19,021
Accumulated Depreciation	$ 626
Bloomingdale | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Bloomingdale | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Bloomingdale | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	1,178
Building and Improve-ments	5,182
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	1,178
Building and Improve-ments	5,182
Total	6,360
Accumulated Depreciation	$ 145
Columbia | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Columbia | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Columbia | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	6,989
Building and Improve-ments	46,875
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	6,989
Building and Improve-ments	46,875
Total	53,864
Accumulated Depreciation	$ 1,166
Denver | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Denver | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Denver | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	9,948
Building and Improve-ments	23,888
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	9,948
Building and Improve-ments	23,888
Total	33,836
Accumulated Depreciation	$ 682
Columbus | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Columbus | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Columbus | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,943
Building and Improve-ments	22,651
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,943
Building and Improve-ments	22,651
Total	25,594
Accumulated Depreciation	$ 833
Miramar | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Miramar | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Miramar | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	4,488
Building and Improve-ments	19,979
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	4,488
Building and Improve-ments	19,979
Total	24,467
Accumulated Depreciation	$ 643
Irving Carpenter | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Irving Carpenter | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Irving Carpenter | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	1,842
Building and Improve-ments	22,052
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	1,995
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	1,842
Building and Improve-ments	24,047
Total	25,889
Accumulated Depreciation	$ 294
Frisco | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Frisco | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Frisco | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	8,239
Building and Improve-ments	51,395
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	1,104
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	8,239
Building and Improve-ments	52,499
Total	60,738
Accumulated Depreciation	$ 1,300
Houston Westway II | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Houston Westway II | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Houston Westway II | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	3,961
Building and Improve-ments	78,668
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	3,961
Building and Improve-ments	78,668
Total	82,629
Accumulated Depreciation	$ 2,363
Houston Westway I | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Houston Westway I | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Houston Westway I | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	6,540
Building and Improve-ments	30,703
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	6,540
Building and Improve-ments	30,703
Total	37,243
Accumulated Depreciation	$ 1,068
Atlanta Perimeter | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Atlanta Perimeter | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Atlanta Perimeter | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	8,607
Building and Improve-ments	96,718
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	278
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	8,607
Building and Improve-ments	96,996
Total	105,603
Accumulated Depreciation	$ 3,394
Herndon | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Herndon | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Herndon | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	9,666
Building and Improve-ments	74,098
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	9,666
Building and Improve-ments	74,098
Total	83,764
Accumulated Depreciation	$ 1,987
Deerfield | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Deerfield | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Deerfield | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	4,339
Building and Improve-ments	37,298
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	4,339
Building and Improve-ments	37,298
Total	41,637
Accumulated Depreciation	$ 1,164
DreamWorks | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
DreamWorks | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
DreamWorks | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	26,387
Building and Improve-ments	190,805
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	26,387
Building and Improve-ments	190,805
Total	217,192
Accumulated Depreciation	$ 2,640
Highway 94 | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Highway 94 | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Highway 94 | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 18,968
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	5,540
Building and Improve-ments	28,230
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	5,540
Building and Improve-ments	28,230
Total	33,770
Accumulated Depreciation	$ 202
DynCorp | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
DynCorp | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
DynCorp | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 11,162
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	1,952
Building and Improve-ments	15,540
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	1,952
Building and Improve-ments	15,540
Total	17,492
Accumulated Depreciation	$ 57
Mercedes-Benz | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Mercedes-Benz | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Mercedes-Benz | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 18,945
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	2,330
Building and Improve-ments	26,376
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	2,330
Building and Improve-ments	26,376
Total	28,706
Accumulated Depreciation	$ 94
Samsonite | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Samsonite | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years
Samsonite | Operating Properties
Real Estate Properties [Line Items]
Encumbrances	$ 24,561
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	5,040
Building and Improve-ments	42,490
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	0
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	5,040
Building and Improve-ments	42,490
Total	47,530
Accumulated Depreciation	88
Restoration Hardware
Real Estate Properties [Line Items]
Encumbrances	0
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost [Abstract]
Land	15,463
Building and Improve-ments	0
SEC Schedule III Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition [Abstract]
Building and Improve-ments	75,712
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Land	15,463
Building and Improve-ments	75,712
Total	91,175
Accumulated Depreciation	$ 1,314
Restoration Hardware | Minimum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	5 years
Restoration Hardware | Maximum
SEC Schedule III, Real Estate Investment Property, Net [Abstract]
Life on which depreciation in latest income statement is computed	40 years

XML

- Rollforward (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Real estate facilities
Balance at beginning of year	$ 1,823,895	$ 1,175,423	$ 328,342
Acquisitions	1,087,153	712,036	854,218
Improvements	7,381	2,826	256
Construction-in-progress	45,067	35,831	7
Real estate assets held for sale	0	(91,074)	(7,400)
Write off of tenant origination and absorption costs	0	(4,762)	0
Sale of real estate assets	(65,422)	(6,385)	0
Balance at end of year	2,898,074	1,823,895	1,175,423
Accumulated depreciation
Balance at beginning of year	102,883	42,806	18,898
Depreciation expense	112,748	72,907	24,191
Non-real estate assets depreciation expense	(328)	(170)	0
Real estate assets held for sale depreciation expense	(2,265)	(7,520)	(283)
Sale of real estate assets depreciation expense	(10,990)	(378)	0
Balance at end of year	202,048	102,883	42,806
Total real estate, net	$ 2,696,026	$ 1,721,012	$ 1,132,617