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SEGMENT REPORTING
 9 Months Ended
Sep. 30, 2019
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,
 
2019
 
2018
 
2019
 
2018
Total Retail
 
 
 
 
 
 
 
Property revenue
$
25,848

 
$
25,925

 
$
81,156

 
$
78,497

Property expense
(7,806
)
 
(7,062
)
 
(22,691
)
 
(21,011
)
Segment profit
18,042

 
18,863

 
58,465

 
57,486

Total Office
 
 
 
 
 
 
 
Property revenue
42,810

 
27,251

 
100,816

 
85,073

Property expense
(11,627
)
 
(8,243
)
 
(29,385
)
 
(24,598
)
Segment profit
31,183

 
19,008

 
71,431

 
60,475

Total Multifamily
 
 
 
 
 
 
 
Property revenue
12,655

 
12,848

 
38,451

 
37,894

Property expense
(5,367
)
 
(5,157
)
 
(15,323
)
 
(15,174
)
Segment profit
7,288

 
7,691

 
23,128

 
22,720

Total Mixed-Use
 
 
 
 
 
 
 
Property revenue
17,049

 
16,483

 
47,371

 
46,798

Property expense
(10,131
)
 
(9,708
)
 
(28,475
)
 
(27,863
)
Segment profit
6,918

 
6,775

 
18,896

 
18,935

Total segments’ profit
$
63,431

 
$
52,337

 
$
171,920

 
$
159,616


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,
 
2019
 
2018
 
2019
 
2018
Total segments’ profit
$
63,431

 
$
52,337

 
$
171,920

 
$
159,616

General and administrative
(6,479
)
 
(5,176
)
 
(18,495
)
 
(16,139
)
Depreciation and amortization
(26,568
)
 
(19,886
)
 
(69,733
)
 
(86,033
)
Interest expense
(13,734
)
 
(12,879
)
 
(40,212
)
 
(39,387
)
Gain on sale of real estate
—

 
—

 
633

 
—

Other (expense) income, net
(131
)
 
(125
)
 
(410
)
 
(64
)
Net income
16,519

 
14,271

 
43,703

 
17,993

Net income attributable to restricted shares
(92
)
 
(71
)
 
(277
)
 
(215
)
Net income attributable to unitholders in the Operating Partnership
(3,565
)
 
(3,806
)
 
(10,553
)
 
(4,765
)
Net income attributable to American Assets Trust, Inc. stockholders
$
12,862

 
$
10,394

 
$
32,873

 
$
13,013


The following table shows net real estate and secured note payable balances for each of the segments (in thousands):
 
September 30, 2019
 
December 31, 2018
Net Real Estate
 
 
 
Retail
$
626,737

 
$
628,734

Office
1,306,967

 
822,574

Multifamily
403,555

 
412,042

Mixed-Use
177,038

 
176,503

 
$
2,514,297

 
$
2,039,853

Secured Notes Payable (1)
 
 
 
Retail
$
34,434

 
$
35,008

Office
127,864

 
147,757

 
$
162,298

 
$
182,765

(1)
Excludes debt issuance costs of $0.1 million and $0.2 million for each of the periods ended September 30, 2019 and December 31, 2018, respectively.

Capital expenditures for each segment for the three and nine months ended September 30, 2019 and 2018 were as follows (in thousands):
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2019
 
2018
 
2019
 
2018
Capital Expenditures (1)
 
 
 
 
 
 
 
Retail
$
5,290

 
$
3,221

 
$
16,731

 
$
8,678

Office
16,548

 
9,407

 
50,449

 
24,293

Multifamily
1,297

 
536

 
2,753

 
3,020

Mixed-Use
845

 
219

 
4,508

 
802

 
$
23,980

 
$
13,383

 
$
74,441

 
$
36,793

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