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SEGMENT REPORTING
 9 Months Ended
Sep. 30, 2018
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 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): 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2018
 
2017
 
2018
 
2017
Total Retail
 
 
 
 
 
 
 
Property revenue
$
25,925

 
$
26,547

 
$
78,497

 
$
76,292

Property expense
(7,062
)
 
(6,934
)
 
(21,011
)
 
(20,419
)
Segment profit
18,863

 
19,613

 
57,486

 
55,873

Total Office
 
 
 
 
 
 
 
Property revenue
27,251

 
26,653

 
85,073

 
79,002

Property expense
(8,243
)
 
(7,874
)
 
(24,598
)
 
(23,720
)
Segment profit
19,008

 
18,779

 
60,475

 
55,282

Total Multifamily
 
 
 
 
 
 
 
Property revenue
12,848

 
12,410

 
37,894

 
31,324

Property expense
(5,157
)
 
(5,281
)
 
(15,174
)
 
(12,574
)
Segment profit
7,691

 
7,129

 
22,720

 
18,750

Total Mixed-Use
 
 
 
 
 
 
 
Property revenue
16,483

 
16,729

 
46,798

 
46,619

Property expense
(9,708
)
 
(9,623
)
 
(27,863
)
 
(28,139
)
Segment profit
6,775

 
7,106

 
18,935

 
18,480

Total segments’ profit
$
52,337

 
$
52,627

 
$
159,616

 
$
148,385


The following table is a reconciliation of segment profit to net income attributable to stockholders (in thousands):
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2018
 
2017
 
2018
 
2017
Total segments’ profit
$
52,337

 
$
52,627

 
$
159,616

 
$
148,385

General and administrative
(5,176
)
 
(4,958
)
 
(16,139
)
 
(15,171
)
Depreciation and amortization
(19,886
)
 
(21,192
)
 
(86,033
)
 
(63,360
)
Interest expense
(12,879
)
 
(13,873
)
 
(39,387
)
 
(39,856
)
Other (expense) income, net
(125
)
 
(99
)
 
(64
)
 
403

Net income
14,271

 
12,505

 
17,993

 
30,401

Net income attributable to restricted shares
(71
)
 
(60
)
 
(215
)
 
(181
)
Net income attributable to unitholders in the Operating Partnership
(3,806
)
 
(3,351
)
 
(4,765
)
 
(8,220
)
Net income attributable to American Assets Trust, Inc. stockholders
$
10,394

 
$
9,094

 
$
13,013

 
$
22,000


The following table shows net real estate and secured note payable balances for each of the segments (in thousands):
 
September 30, 2018
 
December 31, 2017
Net Real Estate
 
 
 
Retail
$
629,484

 
$
658,654

Office
813,623

 
813,121

Multifamily
414,983

 
424,044

Mixed-Use
177,477

 
180,888

 
$
2,035,567

 
$
2,076,707

Secured Notes Payable (1)
 
 
 
Retail
$
35,196

 
$
35,737

Office
169,851

 
170,408

Multifamily
—

 
73,744

Mixed-Use
—

 
—

 
$
205,047

 
$
279,889

(1)
Excludes debt issuance costs of $0.2 million and $0.3 million for each of the periods ending September 30, 2018 and December 31, 2017, respectively.

Capital expenditures for each segment for the three and nine months ended September 30, 2018 and 2017 were as follows (in thousands):
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2018
 
2017
 
2018
 
2017
Capital Expenditures (1)
 
 
 
 
 
 
 
Retail
$
3,221

 
$
3,803

 
$
8,678

 
$
7,849

Office
9,407

 
10,555

 
24,293

 
25,715

Multifamily
536

 
1,953

 
3,020

 
4,521

Mixed-Use
219

 
211

 
802

 
414

 
$
13,383

 
$
16,522

 
$
36,793

 
$
38,499

(1)
Capital expenditures represent cash paid for capital expenditures during the period and include leasing commissions paid.