Segment Reporting (Notes)

12 Months Ended

Dec. 31, 2014

Segment Reporting [Abstract]

SEGMENT REPORTING

SEGMENT REPORTING

Segment information is prepared on the same basis that our management reviews information for operational decision-making purposes. We review operating and financial information for each property on an individual basis and therefore, each property represents an individual operating segment. However, we have aggregated our properties into reportable segments as the properties share similar long-term economic characteristics and have other similarities including the fact that they are operated using consistent business strategies.

We operate in four business segments: the acquisition, redevelopment, ownership and management of retail real estate, office real estate, multifamily real estate and mixed-use real estate. The products for our retail segment primarily include rental of retail space and other tenant services, including tenant reimbursements, parking and storage space rental. The products for our office segment primarily include rental of office space and other tenant services, including tenant reimbursements, parking and storage space rental. The products for our multifamily segment include rental of apartments and other tenant services. The products of our mixed-use segment include rental of retail space and other tenant services, including tenant reimbursements, parking and storage space rental and operation of a 369-room all-suite hotel.

We evaluate the performance of our segments based on segment profit which is defined as property revenue less property expenses. We do not use asset information as a measure to assess performance and make decisions to allocate resources. Therefore, depreciation and amortization expense is not allocated among segments. General and administrative expenses, interest expense, depreciation and amortization expense and other income and expense are not included in segment profit as our internal reporting addresses these items on a corporate level.

Segment profit is not a measure of operating income or cash flows from operating activities as measured by GAAP, and it is not indicative of cash available to fund cash needs and should not be considered an alternative to cash flows as a measure of liquidity. Not all companies calculate segment profit in the same manner. We consider segment profit to be an appropriate supplemental measure to net income because it assists both investors and management in understanding the core operations of our properties.

The following table represents operating activity within our reportable segments (in thousands):

	Year Ended December 31,
	2014			2013			2012
Total Retail
Property revenue	$	96,140		$	93,449		$	91,991
Property expense	(25,451		)	(23,900		)	(24,955		)
Segment profit	70,689			69,549			67,036
Total Office
Property revenue	92,474			90,527			78,101
Property expense	(27,003		)	(26,688		)	(23,780		)
Segment profit	65,471			63,839			54,321
Total Multifamily
Property revenue	16,976			16,125			14,852
Property expense	(6,099		)	(5,917		)	(5,914		)
Segment profit	10,877			10,208			8,938
Total Mixed-Use
Property revenue	54,410			54,956			50,522
Property expense	(32,678		)	(33,481		)	(31,465		)
Segment profit	21,732			21,475			19,057
Total segments’ profit	$	168,769		$	165,071		$	149,352

The following table is a reconciliation of segment profit to net income attributable to stockholders (in thousands):

	Year Ended December 31,
	2014			2013			2012
Total segments' profit	$	168,769		$	165,071		$	149,352
General and administrative	(18,532		)	(17,195		)	(15,593		)
Depreciation and amortization	(66,568		)	(66,775		)	(61,853		)
Interest expense	(52,965		)	(58,020		)	(57,328		)
Other income (expense), net	441			(487		)	(629		)
Income from continuing operations	31,145			22,594			13,949
Discontinued operations
Income from discontinued operations	—			—			932
Gain on sale of real estate property	—			—			36,720
Results from discontinued operations	—			—			37,652
Net income	31,145			22,594			51,601
Net income attributable to restricted shares	(374		)	(536		)	(529		)
Net income attributable to unitholders in the Operating Partnership	(9,015		)	(6,838		)	(16,134		)
Net income attributable to American Assets Trust, Inc. stockholders	$	21,756		$	15,220		$	34,938

The following table shows net real estate and secured note payable balances for each of the segments, along with their capital expenditures for each year (in thousands):

	December 31, 2014		December 31, 2013
Net real estate
Retail	$	639,456	$	651,707
Office	757,854		750,890
Multifamily	182,468		74,612
Mixed-Use	195,622		199,627
	$	1,775,400	$	1,676,836
Secured Notes Payable(1)
Retail	$	161,975	$	303,249
Office	426,254		427,256
Multifamily	101,444		101,444
Mixed-Use	130,310		130,310
	$	819,983	$	962,259
Capital Expenditures (2)
Retail	$	8,671	$	4,849
Office	34,577		27,275
Multifamily	101,392		24,641
Mixed-Use	5,132		1,942
	$	149,772	$	58,707

(1) Excludes unamortized fair market value adjustment of $7.2 million and $10.1 million as of December 31, 2014 and 2013, respectively.

(2) Capital expenditures represent cash paid for capital expenditures during the year and include leasing commissions paid.