Investment in Unconsolidated Real Estate Entities

3 Months Ended

Mar. 31, 2023

Equity Method Investments and Joint Ventures [Abstract]

Investment in Unconsolidated Real Estate Entities

Investment in Unconsolidated Real Estate Entities

The following table summarizes the Company’s investments in unconsolidated joint ventures:

Property	Property Type	Submarket	Ownership Interest	Functional Currency
Sunset Waltham Cross Studios	Development	Broxbourne, United Kingdom	35%	Pound sterling	(1)
Sunset Glenoaks Studios	Development	Los Angeles	50%	U.S. dollar	(2)(3)
Bentall Centre	Operating Property	Downtown Vancouver	20%	Canadian dollar	(2)(4)

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1.The Company owns 35% of the ownership interests in each of the joint venture entities that own the Sunset Waltham Cross Studios and the joint venture entities formed to serve as the general partner and management services company for the property-owning joint venture entity.

2.The Company serves as the operating member of this joint venture.

3.The Company has provided various guarantees for this joint venture’s construction loan, including a completion guarantee, equity guarantee and recourse carve-out guarantee. The likelihood of loss relating to the completion guarantee is remote as of March 31, 2023.

4.The Company has guaranteed the joint venture’s outstanding indebtedness in the amount of $98.3 million.

The Company’s maximum exposure related to its unconsolidated joint ventures is limited to its investment and the guarantees provided in relation to the joint ventures’ indebtedness. The Company’s investments in foreign real estate entities are subject to foreign currency fluctuation risk. Such investments are translated into U.S. dollars at the exchange rate in effect as of the financial statement date. The Company’s share of the (loss) income from foreign unconsolidated real estate entities is translated using the monthly-average exchange rate for the periods presented. Gains or losses resulting from the translation are classified in accumulated other comprehensive loss as a separate component of total equity and are excluded from net income.

The Company held ownership interests in other immaterial unconsolidated joint ventures in the total of $0.4 million and $0.1 million as of March 31, 2023 and December 31, 2022, respectively.

The table below presents the combined and condensed balance sheets for the Company’s unconsolidated joint ventures:

	March 31, 2023		December 31, 2022
ASSETS
Investment in real estate, net	$	1,136,830	$	1,093,448
Other assets	63,762		62,870
TOTAL ASSETS	$	1,200,592	$	1,156,318
LIABILITIES
Secured debt, net	$	547,446	$	527,985
Other liabilities	57,467		49,027
TOTAL LIABILITIES	604,913		577,012
Company’s capital(1)	178,494		170,656
Partner’s capital	417,185		408,650
TOTAL CAPITAL	595,679		579,306
TOTAL LIABILITIES AND CAPITAL	$	1,200,592	$	1,156,318

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1.To the extent the Company’s cost basis is different from the basis reflected at the joint venture level, the basis is amortized over the life of the related asset and is included in the (loss) income from unconsolidated real estate entities line item on the Consolidated Statements of Operations.

The table below presents the combined and condensed statements of operations for the Company’s unconsolidated joint ventures:

	Three Months Ended March 31,
	2023		2022
TOTAL REVENUES	$	18,471	$	19,532
TOTAL EXPENSES	22,077		17,778
NET (LOSS) INCOME	$	(3,606)	$	1,754