10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2021

or

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

For the transition period from             to             

AMERICAN ASSETS TRUST, INC.

(Exact Name of Registrant as Specified in its Charter)

Commission file number: 001-35030

AMERICAN ASSETS TRUST, L.P.

(Exact Name of Registrant as Specified in its Charter)

Commission file number: 333-202342-01

Maryland	(American Assets Trust, Inc.)	27-3338708	(American Assets Trust, Inc.)
Maryland	(American Assets Trust, L.P.)	27-3338894	(American Assets Trust, L.P.)
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

3420 Carmel Mountain Road, Suite 100

San Diego, California 92121

(Address of Principal Executive Offices and Zip Code)

(858) 350-2600

(Registrant’s Telephone Number, Including Area Code)

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.    

    American Assets Trust, Inc.             ☒  Yes   ☐  No

    American Assets Trust, L.P.            ☒  Yes   ☐  No

(American Assets Trust, L.P. became subject to filing requirements under Section 13 of the Securities Exchange Act of 1934, as amended, upon effectiveness of its Registration Statement on Form S-3 on February 6, 2015 and has filed all required reports subsequent to that date.)

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).    

    American Assets Trust, Inc.             ☒  Yes   ☐   No

    American Assets Trust, L.P.            ☒  Yes   ☐   No

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

American Assets Trust, Inc.

Large Accelerated Filer	☒		Accelerated Filer	☐
Non-Accelerated Filer	☐	(Do not check if a smaller reporting company)	Smaller reporting company	☐
Emerging growth company	☐

American Assets Trust, L.P.

Large Accelerated Filer	☐		Accelerated Filer	☐
Non-Accelerated Filer	☒	(Do not check if a smaller reporting company)	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).      

    American Assets Trust, Inc.             ☐  Yes    ☒  No

    American Assets Trust, L.P.            ☐  Yes    ☒  No

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

Name of Registrant	Title of each class	Trading Symbol	Name of each exchange on which registered
American Assets Trust, Inc.	Common Stock, par value $0.01 per share	AAT	New York Stock Exchange
American Assets Trust, L.P.	None	None	None

American Assets Trust, Inc. had 60,472,286 shares of common stock, par value $0.01 per share, outstanding as of April 30, 2021.

EXPLANATORY NOTE

This report combines the quarterly reports on Form 10-Q for the quarter ended March 31, 2021 of American Assets Trust, Inc., a Maryland corporation, and American Assets Trust, L.P., a Maryland limited partnership, of which American Assets Trust, Inc. is the parent company and sole general partner. Unless otherwise indicated or unless the context requires otherwise, all references in this report to “we,” “us,” “our” or “the company” refer to American Assets Trust, Inc. together with its consolidated subsidiaries, including American Assets Trust, L.P. Unless otherwise indicated or unless the context requires otherwise, all references in this report to “our Operating Partnership” or “the Operating Partnership” refer to American Assets Trust, L.P. together with its consolidated subsidiaries.

American Assets Trust, Inc. operates as a real estate investment trust, or REIT, and is the sole general partner of the Operating Partnership. As of March 31, 2021, American Assets Trust, Inc. owned an approximate 78.8% partnership interest in the Operating Partnership. The remaining approximately 21.3% partnership interests are owned by non-affiliated investors and certain of our directors and executive officers. As the sole general partner of the Operating Partnership, American Assets Trust, Inc. has full, exclusive and complete authority and control over the Operating Partnership’s day-to-day management and business, can cause it to enter into certain major transactions, including acquisitions, dispositions and debt refinancings, and can cause changes in its line of business, capital structure and distribution policies.

The company believes that combining the quarterly reports on Form 10-Q of American Assets Trust, Inc. and the Operating Partnership into a single report will result in the following benefits:

•better reflects how management and the analyst community view the business as a single operating unit;

•enhance investors' understanding of American Assets Trust, Inc. and the Operating Partnership by enabling them to view the business as a whole and in the same manner as management;

•greater efficiency for American Assets Trust, Inc. and the Operating Partnership and resulting savings in time, effort and expense; and

•greater efficiency for investors by reducing duplicative disclosure by providing a single document for their review.

Management operates American Assets Trust, Inc. and the Operating Partnership as one enterprise. The management of American Assets Trust, Inc. and the Operating Partnership are the same.

There are certain differences between American Assets Trust, Inc. and the Operating Partnership, which are reflected in the disclosures in this report. We believe it is important to understand the differences between American Assets Trust, Inc. and the Operating Partnership in the context of how American Assets Trust, Inc. and the Operating Partnership operate as an interrelated consolidated company. American Assets Trust, Inc. is a REIT, whose only material asset is its ownership of partnership interests of the Operating Partnership. As a result, American Assets Trust, Inc. does not conduct business itself, other than acting as the sole general partner of the Operating Partnership, issuing public equity from time to time and guaranteeing certain debt of the Operating Partnership. American Assets Trust, Inc. itself does not hold any indebtedness. The Operating Partnership holds substantially all the assets of the company, directly or indirectly holds the ownership interests in the company’s real estate ventures, conducts the operations of the business and is structured as a partnership with no publicly-traded equity. Except for net proceeds from public equity issuances by American Assets Trust, Inc., which are generally contributed to the Operating Partnership in exchange for partnership units, the Operating Partnership generates the capital required by the company’s business through the Operating Partnership’s operations, by the Operating Partnership’s direct or indirect incurrence of indebtedness or through the issuance of operating partnership units.

Noncontrolling interests and stockholders’ equity and partners’ capital are the main areas of difference between the consolidated financial statements of American Assets Trust, Inc. and those of American Assets Trust, L.P. The partnership interests in the Operating Partnership that are not owned by American Assets Trust, Inc. are accounted for as partners’ capital in the Operating Partnership’s financial statements and as noncontrolling interests in American Assets Trust, Inc.’s financial statements. To help investors understand the significant differences between the company and the Operating Partnership, this report presents the following separate sections for each of American Assets Trust, Inc. and the Operating Partnership:

•consolidated financial statements;

•the following notes to the consolidated financial statements:

◦Debt;

◦Equity/Partners' Capital; and

◦Earnings Per Share/Unit; and

•Liquidity and Capital Resources in Management's Discussion and Analysis of Financial Condition and Results of Operations.

This report also includes separate Item 4. Controls and Procedures sections and separate Exhibit 31 and 32 certifications for each of American Assets Trust, Inc. and the Operating Partnership in order to establish that the Chief Executive Officer and the Chief Financial Officer of American Assets Trust, Inc. have made the requisite certifications and American Assets Trust, Inc. and the Operating Partnership are compliant with Rule 13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934 and 18 U.S.C. §1350.

AMERICAN ASSETS TRUST, INC. AND AMERICAN ASSETS TRUST, L.P.

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED MARCH 31, 2021

PART 1. FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Financial Statements of American Assets Trust, Inc.:
		Consolidated Balance Sheets as of March 31, 2021 (unaudited) and December 31, 2020	1
		Consolidated Statements of Comprehensive Income (unaudited) for the three months ended March 31, 2021 and 2020	2
		Consolidated Statement of Equity (unaudited) for the three months ended March 31, 2021 and 2020	3
		Consolidated Statements of Cash Flows (unaudited) for the three months ended March 31, 2021 and 2020	4
	Consolidated Financial Statements of American Assets Trust, L.P.:
		Consolidated Balance Sheets as of March 31, 2021 (unaudited) and December 31, 2020	5
		Consolidated Statements of Comprehensive Income (unaudited) for the three months ended March 31, 2021 and 2020	6
		Consolidated Statement of Partners' Capital (unaudited) for the three months ended March 31, 2021 and 2020	7
		Consolidated Statements of Cash Flows (unaudited) for the three months ended March 31, 2021 and 2020	8
	Notes to Consolidated Financial Statements (unaudited)		9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		29
Item 3.	Quantitative and Qualitative Disclosures about Market Risk		44
Item 4.	Controls and Procedures		45
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings		46
Item 1A.	Risk Factors		46
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		46
Item 3.	Defaults Upon Senior Securities		47
Item 4.	Mine Safety Disclosures		47
Item 5.	Other Information		47
Item 6.	Exhibits		47
SIGNATURES			48

PART 1 - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

American Assets Trust, Inc.

Consolidated Balance Sheets

(In Thousands, Except Share Data)

	March 31,		December 31,
	2021		2020
	(unaudited)
ASSETS
Real estate, at cost
Operating real estate	$	3,164,594	$	3,155,280
Construction in progress	93,001		91,047
Held for development	547		547
	3,258,142		3,246,874
Accumulated depreciation	(776,825)		(754,140)
Real estate, net	2,481,317		2,492,734
Cash and cash equivalents	380,434		137,333
Restricted cash	1,716		1,716
Accounts receivable, net	6,031		6,938
Deferred rent receivables, net	76,690		72,476
Other assets, net	103,158		106,112
TOTAL ASSETS	$	3,049,346	$	2,817,309
LIABILITIES AND EQUITY
LIABILITIES:
Secured notes payable, net	$	110,934	$	110,923
Unsecured notes payable, net	1,536,890		1,196,677
Unsecured line of credit, net	—		99,151
Accounts payable and accrued expenses	71,226		59,262
Security deposits payable	6,629		6,590
Other liabilities and deferred credits, net	88,228		91,300
Total liabilities	1,813,907		1,563,903
Commitments and contingencies (Note 11)
EQUITY:
American Assets Trust, Inc. stockholders’ equity
Common stock, $0.01 par value, 490,000,000 shares authorized, 60,472,286 and 60,476,292 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively	605		605
Additional paid-in capital	1,447,128		1,445,644
Accumulated dividends in excess of net income	(192,098)		(176,560)
Accumulated other comprehensive income	1,964		1,753
Total American Assets Trust, Inc. stockholders’ equity	1,257,599		1,271,442
Noncontrolling interests	(22,160)		(18,036)
Total equity	1,235,439		1,253,406
TOTAL LIABILITIES AND EQUITY	$	3,049,346	$	2,817,309

The accompanying notes are an integral part of these consolidated financial statements.

1

American Assets Trust, Inc.

Consolidated Statements of Comprehensive Income

(Unaudited)

(In Thousands, Except Shares and Per Share Data)

	Three Months Ended March 31,
	2021		2020
REVENUE:
Rental income	$	81,130	$	92,070
Other property income	2,856		4,673
Total revenue	83,986		96,743
EXPENSES:
Rental expenses	18,246		22,568
Real estate taxes	11,354		11,045
General and administrative	6,823		6,820
Depreciation and amortization	27,501		27,462
Total operating expenses	63,924		67,895
OPERATING INCOME	20,062		28,848
Interest expense	(14,005)		(13,472)
Early extinguishment of debt	(4,271)		—
Other (expense) income, net	(53)		108
NET INCOME	1,733		15,484
Net income attributable to restricted shares	(137)		(104)
Net income attributable to unitholders in the Operating Partnership	(339)		(3,312)
NET INCOME ATTRIBUTABLE TO AMERICAN ASSETS TRUST, INC. STOCKHOLDERS	$	1,257	$	12,068
EARNINGS PER COMMON SHARE
Earnings per common share, basic	$	0.02	$	0.20
Weighted average shares of common stock outstanding - basic	59,984,335		59,723,072
Earnings per common share, diluted	$	0.02	$	0.20
Weighted average shares of common stock outstanding - diluted	76,165,872		76,113,620
DIVIDENDS DECLARED PER COMMON SHARE	$	0.28	$	0.30
COMPREHENSIVE INCOME
Net income	$	1,733	$	15,484
Other comprehensive income (loss) - unrealized income (loss) on swap derivatives during the period	747		(6,115)
Reclassification of amortization of forward-starting swap realized gains included in interest expense	(275)		(333)
Reclassification of amortization of forward-starting swap realized gain included in early extinguishment of debt	(193)		—
Comprehensive income	2,012		9,036
Comprehensive income attributable to non-controlling interests	(407)		(1,941)
Comprehensive income attributable to American Assets Trust, Inc.	$	1,605	$	7,095

The accompanying notes are an integral part of these consolidated financial statements.

2

American Assets Trust, Inc.

Consolidated Statement of Equity

(Unaudited)

(In Thousands, Except Share Data)

	American Assets Trust, Inc. Stockholders’ Equity									Noncontrolling Interests - Unitholders in the Operating Partnership		Total
	Common Shares			Additional Paid-in Capital		Accumulated Dividends in Excess of Net Income		Accumulated Other Comprehensive Income (Loss)
	Shares	Amount
Balance at December 31, 2020	60,476,292	$	605	$	1,445,644	$	(176,560)	$	1,753	$	(18,036)	$	1,253,406
Net income	—	—		—		1,394		—		339		1,733
Forfeiture of restricted stock	(4,006)	—		—		—		—		—		—
Dividends declared and paid	—	—		—		(16,932)		—		(4,531)		(21,463)
Stock-based compensation	—	—		1,484		—		—		—		1,484
Other comprehensive gain - change in value of interest rate swaps	—	—		—		—		579		168		747
Reclassification of amortization of forward-starting swap realized gains included in interest expense	—	—		—		—		(216)		(59)		(275)
Reclassification of amortization of forward-starting swap realized gain included in early extinguishment of debt	—	$	—	$	—	$	—	$	(152)	$	(41)	(193)
Balance at March 31, 2021	60,472,286	$	605	$	1,447,128	$	(192,098)	$	1,964	$	(22,160)	$	1,235,439

	Common Shares			Additional Paid-in Capital		Accumulated Dividends in Excess of Net Income		Accumulated Other Comprehensive Income (Loss)		Noncontrolling Interests - Unitholders in the Operating Partnership		Total
	Shares	Amount
Balance at December 31, 2019	60,068,228	$	601	$	1,452,014	$	(144,378)	$	5,680	$	(20,245)	$	1,293,672
Net income	—	—		—		12,172		—		3,312		15,484
Dividends declared and paid	—	—		—		(18,020)		—		(4,917)		(22,937)
Stock-based compensation	—	—		1,250		—		—		—		1,250
Other comprehensive loss - change in value of interest rate swaps	—	—		—		—		(4,816)		(1,299)		(6,115)
Reclassification of amortization of forward-starting swap included in interest expense	—	—		—		—		(261)		(72)		(333)
Balance at March 31, 2020	60,068,228	$	601	$	1,453,264	$	(150,226)	$	603	$	(23,221)	$	1,281,021

The accompanying notes are an integral part of these consolidated financial statements.

3

American Assets Trust, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

(In Thousands)

	Three Months Ended March 31,
	2021		2020
OPERATING ACTIVITIES
Net income	$	1,733	$	15,484
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred rent revenue and amortization of lease intangibles	(6,292)		(3,762)
Depreciation and amortization	27,501		27,462
Amortization of debt issuance costs and debt discounts	577		374
Early extinguishment of debt	4,271		—
Provision for uncollectable rental income	3,213		370
Stock-based compensation expense	1,484		1,250
Other noncash interest expense	(275)		(333)
Other, net	32		(3,940)
Changes in operating assets and liabilities
Change in accounts receivable	(1,841)		3,632
Change in other assets	651		616
Change in accounts payable and accrued expenses	11,098		4,435
Change in security deposits payable	39		30
Change in other liabilities and deferred credits	314		(257)
Net cash provided by operating activities	42,505		45,361
INVESTING ACTIVITIES
Capital expenditures	(11,372)		(20,531)
Leasing commissions	(844)		(3,394)
Net cash used in investing activities	(12,216)		(23,925)
FINANCING ACTIVITIES
Repayment of secured notes payable	—		(51,003)
Repayment of unsecured line of credit	(100,000)		—
Proceeds from unsecured notes payable	494,675		—
Repayment of unsecured notes payable	(155,375)		—
Debt issuance costs	(5,025)		—
Proceeds from issuance of common stock, net	—		(119)
Dividends paid to common stock and unitholders	(21,463)		(22,937)
Net cash provided by (used in) financing activities	212,812		(74,059)
Net increase (decrease) in cash and cash equivalents	243,101		(52,623)
Cash, cash equivalents and restricted cash, beginning of period	139,049		109,451
Cash, cash equivalents and restricted cash, end of period	$	382,150	$	56,828

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same amounts shown in the consolidated statement of cash flows:

	Three Months Ended March 31,
	2021		2020
Cash and cash equivalents	380,434		52,371
Restricted cash	1,716		4,457
Total cash, cash equivalents and restricted cash shown in the consolidated statement of cash flows	$	382,150	$	56,828

The accompanying notes are an integral part of these consolidated financial statements.

4

American Assets Trust, L.P.

Consolidated Balance Sheets

(In Thousands, Except Unit Data)

	March 31,		December 31,
	2021		2020
	(unaudited)
ASSETS
Real estate, at cost
Operating real estate	$	3,164,594	$	3,155,280
Construction in progress	93,001		91,047
Held for development	547		547
	3,258,142		3,246,874
Accumulated depreciation	(776,825)		(754,140)
Real estate, net	2,481,317		2,492,734
Cash and cash equivalents	380,434		137,333
Restricted cash	1,716		1,716
Accounts receivable, net	6,031		6,938
Deferred rent receivables, net	76,690		72,476
Other assets, net	103,158		106,112
TOTAL ASSETS	$	3,049,346	$	2,817,309
LIABILITIES AND CAPITAL
LIABILITIES:
Secured notes payable, net	$	110,934	$	110,923
Unsecured notes payable, net	1,536,890		1,196,677
Unsecured line of credit, net	—		99,151
Accounts payable and accrued expenses	71,226		59,262
Security deposits payable	6,629		6,590
Other liabilities and deferred credits, net	88,228		91,300
Total liabilities	1,813,907		1,563,903
Commitments and contingencies (Note 11)
CAPITAL:
Limited partners' capital, 16,181,537 and 16,181,537 units issued and outstanding as of March 31, 2021 and December 31, 2020, respectively	(23,212)		(19,020)
General partner's capital, 60,472,286 and 60,476,292 units issued and outstanding as of March 31, 2021 and December 31, 2020, respectively	1,255,635		1,269,689
Accumulated other comprehensive income	3,016		2,737
Total capital	1,235,439		1,253,406
TOTAL LIABILITIES AND CAPITAL	$	3,049,346	$	2,817,309

The accompanying notes are an integral part of these consolidated financial statements.

5

American Assets Trust, L.P.

Consolidated Statements of Comprehensive Income

(Unaudited)

(In Thousands, Except Shares and Per Unit Data)

	Three Months Ended March 31,
	2021		2020
REVENUE:
Rental income	$	81,130	$	92,070
Other property income	2,856		4,673
Total revenue	83,986		96,743
EXPENSES:
Rental expenses	18,246		22,568
Real estate taxes	11,354		11,045
General and administrative	6,823		6,820
Depreciation and amortization	27,501		27,462
Total operating expenses	63,924		67,895
OPERATING INCOME	20,062		28,848
Interest expense	(14,005)		(13,472)
Early extinguishment of debt	(4,271)		—
Other (expense) income, net	(53)		108
NET INCOME	1,733		15,484
Net income attributable to restricted shares	(137)		(104)
NET INCOME ATTRIBUTABLE TO AMERICAN ASSETS TRUST, L.P.	$	1,596	$	15,380
EARNINGS PER UNIT - BASIC
Earnings per unit, basic	$	0.02	$	0.20
Weighted average units outstanding - basic	76,165,872		76,113,620
EARNINGS PER UNIT - DILUTED
Earnings per unit, diluted	$	0.02	$	0.20
Weighted average units outstanding - diluted	76,165,872		76,113,620
DISTRIBUTIONS PER UNIT	$	0.28	$	0.30
COMPREHENSIVE INCOME
Net income	$	1,733	$	15,484
Other comprehensive income (loss) - unrealized income (loss) on swap derivatives during the period	747		(6,115)
Reclassification of amortization of forward-starting swap realized gains included in interest expense	(275)		(333)
Reclassification of amortization of forward-starting swap realized gain included in early extinguishment of debt	(193)		—
Comprehensive income	2,012		9,036
Comprehensive income attributable to Limited Partners	(407)		(1,941)
Comprehensive income attributable to General Partner	$	1,605	$	7,095

The accompanying notes are an integral part of these consolidated financial statements.

6

American Assets Trust, L.P.

Consolidated Statement of Partners' Capital

(Unaudited)

(In Thousands, Except Unit Data)

	Limited Partners' Capital (1)			General Partner's Capital (2)			Accumulated Other Comprehensive Income (Loss)		Total Capital
	Units	Amount		Units	Amount
Balance at December 31, 2020	16,181,537	$	(19,020)	60,476,292	$	1,269,689	$	2,737	$	1,253,406
Net income	—	339		—	1,394		—		1,733
Forfeiture of restricted units	—	—		(4,006)	—		—		—
Distributions	—	(4,531)		—	(16,932)		—		(21,463)
Stock-based compensation	—	—		—	1,484		—		1,484
Other comprehensive gain - change in value of interest rate swap	—	—		—	—		747		747
Reclassification of amortization of forward-starting swap realized gains included in interest expense	—	—		—	—		(275)		(275)
Reclassification of amortization of forward-starting swap included in early extinguishment of debt	—	—		—	—		(193)		(193)
Balance at March 31, 2021	16,181,537	$	(23,212)	60,472,286	$	1,255,635	$	3,016	$	1,235,439

	Limited Partners' Capital (1)			General Partner's Capital (2)			Accumulated Other Comprehensive Income (Loss)		Total Capital
	Units	Amount		Units	Amount
Balance at December 31, 2019	16,390,548	$	(22,281)	60,068,228	$	1,308,237	$	7,716	$	1,293,672
Net income	—	3,312		—	12,172		—		15,484
Distributions	—	(4,917)		—	(18,020)		—		(22,937)
Stock-based compensation	—	—		—	1,250		—		1,250
Other comprehensive loss - change in value of interest rate swap	—	—		—	—		(6,115)		(6,115)
Reclassification of amortization of forward-starting swap realized gains included in interest expense	—	—		—	—		(333)		(333)
Balance at March 31, 2020	16,390,548	$	(23,886)	60,068,228	$	1,303,639	$	1,268	$	1,281,021

(1) Consists of limited partnership interests held by third parties.

(2) Consists of general partnership interests held by American Assets Trust, Inc.

The accompanying notes are an integral part of these consolidated financial statements.

7

American Assets Trust, L.P.

Consolidated Statements of Cash Flows

(Unaudited, In Thousands)

	Three Months Ended March 31,
	2021		2020
OPERATING ACTIVITIES
Net income	$	1,733	$	15,484
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred rent revenue and amortization of lease intangibles	(6,292)		(3,762)
Depreciation and amortization	27,501		27,462
Amortization of debt issuance costs and debt discounts	577		374
Early extinguishment of debt	4,271		—
Provision for uncollectable rental income	3,213		370
Stock-based compensation expense	1,484		1,250
Other noncash interest expense	(275)		(333)
Other, net	32		(3,940)
Changes in operating assets and liabilities
Change in accounts receivable	(1,841)		3,632
Change in other assets	651		616
Change in accounts payable and accrued expenses	11,098		4,435
Change in security deposits payable	39		30
Change in other liabilities and deferred credits	314		(257)
Net cash provided by operating activities	42,505		45,361
INVESTING ACTIVITIES
Capital expenditures	(11,372)		(20,531)
Leasing commissions	(844)		(3,394)
Net cash used in investing activities	(12,216)		(23,925)
FINANCING ACTIVITIES
Repayment of secured notes payable	—		(51,003)
Repayment of unsecured line of credit	(100,000)		—
Proceeds from unsecured notes payable	494,675		—
Repayment of unsecured notes payable	(155,375)		—
Debt issuance costs	(5,025)		—
Contributions from American Assets Trust, Inc.	—		(119)
Distributions	(21,463)		(22,937)
Net cash provided by (used in) financing activities	212,812		(74,059)
Net increase (decrease) in cash and cash equivalents	243,101		(52,623)
Cash, cash equivalents and restricted cash, beginning of period	139,049		109,451
Cash, cash equivalents and restricted cash, end of period	$	382,150	$	56,828

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same amounts shown in the consolidated statement of cash flows:

	Three Months Ended March 31,
	2021		2020
Cash and cash equivalents	$	380,434	$	52,371
Restricted cash	1,716		4,457
Total cash, cash equivalents and restricted cash shown in the consolidated statement of cash flows	$	382,150	$	56,828

The accompanying notes are an integral part of these consolidated financial statements.

8

American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements

March 31, 2021

(Unaudited)

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business and Organization

American Assets Trust, Inc. (which may be referred to in these financial statements as the “Company,” “we,” “us,” or “our”) is a Maryland corporation formed on July 16, 2010 that did not have any operating activity until the consummation of our initial public offering on January 19, 2011. The Company is the sole general partner of American Assets Trust, L.P., a Maryland limited partnership formed on July 16, 2010 (the “Operating Partnership”). The Company’s operations are carried on through our Operating Partnership and its subsidiaries, including our taxable real estate investment trust ("REIT") subsidiary ("TRS"). Since the formation of our Operating Partnership, the Company has controlled our Operating Partnership as its general partner and has consolidated its assets, liabilities and results of operations.

We are a full service, vertically integrated, and self-administered REIT with approximately 190 employees providing substantial in-house expertise in asset management, property management, property development, leasing, tenant improvement construction, acquisitions, repositioning, redevelopment and financing.

As of March 31, 2021, we owned or had a controlling interest in 28 office, retail, multifamily and mixed-use operating properties, the operations of which we consolidate. Additionally, as of March 31, 2021, we owned land at three of our properties that we classify as held for development and/or construction in progress. A summary of the properties owned by us is as follows:

Retail
Carmel Country Plaza	Gateway Marketplace	Alamo Quarry Market
Carmel Mountain Plaza	Del Monte Center	Hassalo on Eighth - Retail
South Bay Marketplace	Geary Marketplace
Lomas Santa Fe Plaza	The Shops at Kalakaua
Solana Beach Towne Centre	Waikele Center
Office
La Jolla Commons	One Beach Street
Torrey Reserve Campus	First & Main
Torrey Point	Lloyd Portfolio
Solana Crossing (formerly Solana Beach Corporate Centre)	City Center Bellevue
The Landmark at One Market
Multifamily
Loma Palisades	Hassalo on Eighth - Residential
Imperial Beach Gardens
Mariner's Point
Santa Fe Park RV Resort
Pacific Ridge Apartments
Mixed-Use
Waikiki Beach Walk Retail and Embassy Suites™ Hotel
Held for Development and/or Construction in Progress
La Jolla Commons – Land
Solana Crossing – Land
Lloyd Portfolio – Construction in Progress

9

American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

Basis of Presentation

Our consolidated financial statements include the accounts of the Company, our Operating Partnership and our subsidiaries. The equity interests of other investors in our Operating Partnership are reflected as noncontrolling interests.

The Company follows the Financial Accounting Standards Board (the "FASB") guidance for determining whether an entity is a variable interest entity (“VIE”) and requires the performance of a qualitative rather than a quantitative analysis to determine the primary beneficiary of a VIE. Under this guidance, an entity would be required to consolidate a VIE if it has (i) the power to direct the activities that most significantly impact the entity’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could be significant to the VIE. American Assets Trust, Inc. has concluded that the Operating Partnership is a VIE, and because American Assets Trust, Inc. has both the power and the rights to control the Operating Partnership, American Assets Trust, Inc. is the primary beneficiary and is required to continue to consolidate the Operating Partnership.Substantially all of the assets and liabilities of the Company are related to the operating partnership VIE.

All intercompany transactions and balances are eliminated in consolidation.

The accompanying consolidated financial statements of the Company and the Operating Partnership have been prepared in accordance with the rules applicable to Form 10-Q and include all information and footnotes required for interim financial statement presentation, but do not include all disclosures required under accounting principles generally accepted in the United States (“GAAP”) for annual financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments, except as otherwise noted) considered necessary for a fair presentation have been included. These financial statements should be read in conjunction with the audited consolidated financial statements and notes therein included in the Company's and Operating Partnership's annual report on Form 10-K for the year ended December 31, 2020.

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that in certain circumstances affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and revenues and expenses. These estimates are prepared using our best judgment, after considering past, current and expected events and economic conditions. Actual results could differ from these estimates.

Any reference to the number of properties, number of units, square footage, employee numbers or percentages of beneficial ownership of our shares are unaudited and outside the scope of our independent registered public accounting firm’s review of our financial statements in accordance with the standards of the United States Public Company Accounting Oversight Board.

Consolidated Statements of Cash Flows—Supplemental Disclosures

The following table provides supplemental disclosures related to the Consolidated Statements of Cash Flows (in thousands): 

	Three Months Ended March 31,
	2021		2020
Supplemental cash flow information
Total interest costs incurred	$	14,564	$	13,736
Interest capitalized	$	559	$	264
Interest expense	$	14,005	$	13,472
Cash paid for interest, net of amounts capitalized	$	13,069	$	15,043
Cash paid for income taxes	$	71	$	51
Supplemental schedule of noncash investing and financing activities
Accounts payable and accrued liabilities for construction in progress	$	7,109	$	16,541
Accrued leasing commissions	$	631	$	2,083

10

American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

 Significant Accounting Policies

We describe our significant accounting policies in Note 1 to the consolidated financial statements in Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2020. There have been no changes to our significant accounting policies during the three months ended March 31, 2021.

Segment Information

Segment information is prepared on the same basis that our chief operating decision maker 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.

Revenue Recognition and Accounts Receivable

Our leases with tenants are classified as operating leases. Substantially all such leases contain fixed rent escalations which occur at specified times during the term of the lease. Base rents are recognized on a straight-line basis from when the tenant controls the space through the term of the related lease, net of valuation adjustments, based on management's assessment of credit, collection and other business risks.

We make estimates of the collectability of our current accounts receivable and straight-line rents receivable which require significant judgment by management. The collectability of receivables is affected by numerous different factors including current economic conditions, including the impact of tenant bankruptcies, the status of collectability of current cash rents receivable, tenants' recent and historical financial and operating results, changes in our tenants' credit ratings, communications between our operating personnel and tenants, the extent of security deposits and letters of credit held with respect to tenants, and the ability of the tenant to perform under the terms of their lease agreement. The provision for doubtful accounts at March 31, 2021 and December 31, 2020 was approximately $12.2 million and $10.0 million, respectively.

Rent Concessions – COVID-19

During the first quarter of 2021, we provided lease concessions to certain tenants, primarily within the retail segment, as a result of the COVID-19 pandemic, in the form of rent deferrals and abatements. These lease concessions generally included an increase in our rights as a lessor. We assess each lease concession and determine whether it represents a lease modifications under Accounting Standards Codification Topic 842, Leases ("ASC 842"). As of March 31, 2021, we have entered into lease modifications that resulted in adjustments (including rent deferrals and other monetary lease concessions) due to the impact of the COVID-19 pandemic of approximately $1.2 million or 2% of the rent originally contracted for the three months ended March 31, 2021. For the first quarter of 2021, we collected approximately $0.7 million or 88% of the deferred rent repayments due during the period.

Recent Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2016-13, Financial Instruments - Credit Topics. The pronouncement requires companies to adopt a new approach to estimating credit losses on certain types of financial instruments, such as trade and other receivables and loans. The standard requires entities to estimate a lifetime expected credit loss for most financial instruments, including trade receivables. In November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses, which clarifies that receivables arising from operating leases are not within the scope of the pronouncement. We adopted the provisions of ASU No. 2016-13 effective January 1, 2020 and the adoption did not have a material impact on our consolidated financial statements as the majority of our receivables are derived from operating leases and are excluded from this standard.

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848), which provides companies with optional practical expedients to ease the accounting burden for contract modifications associated with transitioning away from LIBOR and other interbank offered rates that are expected to be discontinued as part of reference rate reform. For hedges, the

11

American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

guidance generally allows changes to the reference rate and other critical terms without having to de-designate the hedging relationship, as well as allows the shortcut method to continue to be applied. For contract modifications, changes in the reference rate or other critical terms will be treated as a continuation of the prior contract. This guidance can be applied immediately, however, is generally only available through December 31, 2022. We are still evaluating the impact of reference rate reform and whether we will apply any of these practical expedients.

NOTE 2. ACQUIRED IN-PLACE LEASES AND ABOVE/BELOW MARKET LEASES

The following summarizes our acquired lease intangibles and leasing costs, which are included in other assets and other liabilities and deferred credits, as of March 31, 2021 and December 31, 2020 (in thousands): 

	March 31, 2021		December 31, 2020
In-place leases	$	60,447	$	60,965
Accumulated amortization	(35,324)		(34,758)
Above market leases	4,665		5,389
Accumulated amortization	(4,551)		(5,268)
Acquired lease intangible assets, net	$	25,237	$	26,328
Below market leases	$	56,666	$	56,677
Accumulated accretion	(35,993)		(35,219)
Acquired lease intangible liabilities, net	$	20,673	$	21,458

NOTE 3. FAIR VALUE OF FINANCIAL INSTRUMENTS

A fair value measurement is based on the assumptions that market participants would use in pricing an asset or liability. The hierarchy for inputs used in measuring fair value is as follows:

1.Level 1 Inputs—quoted prices in active markets for identical assets or liabilities

2.Level 2 Inputs—observable inputs other than quoted prices in active markets for identical assets and liabilities

3.Level 3 Inputs—unobservable inputs

The carrying values of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued liabilities are reasonable estimates of fair value, using Level 1 inputs, because of the short-term nature of these instruments. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

We measure the fair value of our deferred compensation liability, which is included in other liabilities and deferred credits on the consolidated balance sheet, on a recurring basis using Level 2 inputs. We measure the fair value of this liability based on prices provided by independent market participants that are based on observable inputs using market-based valuation techniques.

The fair value of the interest rate swap agreements are based on the estimated amounts we would receive or pay to terminate the contract at the reporting date and are determined using interest rate pricing models and interest rate related observable inputs. The changes in the fair value of the derivatives that are designated as cash flow hedges are being recorded in accumulated other comprehensive income (loss) and will be subsequently reclassified into earnings during the period in which the hedged forecasted transaction affects earnings.

We incorporate credit valuation adjustments to appropriately reflect both our own non-performance risk and the respective counterparty’s non-performance risk in the fair value measurements. In adjusting the fair value of our derivative contracts for the effect of non-performance risk, we considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees.

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American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

Although we have determined that the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by itself and its counterparties. However, as of March 31, 2021 we have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative position and have determined that the credit valuation adjustments are not significant to the overall valuation of our derivative. As a result, we have determined that our derivative valuation in its entirety is classified in Level 2 of the fair value hierarchy.

A summary of our financial liabilities that are measured at fair value on a recurring basis, by level within the fair value hierarchy is as follows (in thousands):

	March 31, 2021								December 31, 2020
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Deferred compensation liability	$	—	$	2,158	$	—	$	2,158	$	—	$	2,059	$	—	$	2,059
Interest rate swap liability	$	—	$	3,784	$	—	$	3,784	$	—	$	4,531	$	—	$	4,531

 The fair value of our secured notes payable and unsecured senior guaranteed notes are sensitive to fluctuations in interest rates. Discounted cash flow analysis using observable market interest rates (Level 2) is generally used to estimate the fair value of our secured notes payable, using rates ranging from 2.7% to 3.9%.

Considerable judgment is necessary to estimate the fair value of financial instruments. The estimates of fair value presented herein are not necessarily indicative of the amounts that could be realized upon disposition of the financial instruments. The carrying values of our revolving line of credit and term loan set forth below are deemed to be at fair value since the outstanding debt is directly tied to monthly LIBOR contracts. A summary of the carrying amount and fair value of our secured financial instruments, all of which are based on Level 2 inputs, is as follows (in thousands):  

	March 31, 2021				December 31, 2020
	Carrying Value		Fair Value		Carrying Value		Fair Value
Secured notes payable, net	$	110,934	$	113,364	$	110,923	$	114,074
Unsecured term loans, net	$	249,338	$	250,000	$	249,233	$	250,000
Unsecured senior guaranteed notes, net	$	797,645	$	827,895	$	947,444	$	1,017,378
Senior unsecured notes, net	$	489,907	$	493,790	$	—	$	—
Unsecured line of credit, net	$	—	$	—	$	99,151	$	100,000

NOTE 4. DERIVATIVE AND HEDGING ACTIVITIES

Our objectives in using interest rate derivatives are to add stability to interest expense and to manage our exposure to interest rate movements.  To accomplish these objectives, we primarily use interest rate swaps as part of our interest rate risk management strategy.  Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for us making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. 

The following is a summary of the terms of our outstanding interest rate swaps as of March 31, 2021 (dollars in thousands):

Swap Counterparty	Notional Amount		Effective Date	Maturity Date	Fair Value
U.S. Bank N.A.	$	100,000	3/1/2016	3/1/2023	$	(2,533)
Wells Fargo Bank, N.A.	$	50,000	5/2/2016	3/1/2023	$	(1,251)

The effective portion of changes in the fair value of the derivatives that are designated as cash flow hedges are being recorded in accumulated other comprehensive income and will be subsequently reclassified into earnings during the period in which the hedged forecasted transaction affects earnings for as long as hedged cash flows remain probable. During the next twelve months, we estimate that $1.1 million will be reclassified as a decrease to interest expense.

13

American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

The valuation of these instruments is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of the derivative.  This analysis reflects the contractual terms of the derivative, including the period to maturity, counter party credit risk and uses observable market-based inputs, including interest rate curves, and implied volatilities.  The fair value of the interest rate swap is determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts).  The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. 

NOTE 5. OTHER ASSETS

Other assets consist of the following (in thousands): 

	March 31, 2021		December 31, 2020
Leasing commissions, net of accumulated amortization of $36,529 and $35,167, respectively	$	37,385	$	38,173
Acquired above market leases, net	114		121
Acquired in-place leases, net	25,123		26,207
Lease incentives, net of accumulated amortization of $862 and $802, respectively	934		994
Other intangible assets, net of accumulated amortization of $1,277 and $1,213, respectively	2,486		2,565
Debt issuance costs, net of accumulated amortization of $1,324 and $0, respectively	746		—
Right-of-use lease asset, net	28,583		29,350
Prepaid expenses and other	7,787		8,702
Total other assets	$	103,158	$	106,112

NOTE 6. OTHER LIABILITIES AND DEFERRED CREDITS

Other liabilities and deferred credits consist of the following (in thousands):

	March 31, 2021		December 31, 2020
Acquired below market leases, net	$	20,673	$	21,458
Prepaid rent and deferred revenue	14,371		14,518
Interest rate swap liability	3,784		4,531
Deferred rent expense and lease intangible	13		16
Deferred compensation	2,158		2,059
Deferred tax liability	570		570
Straight-line rent liability	17,156		18,049
Lease liability	29,471		30,060
Other liabilities	32		39
Total other liabilities and deferred credits, net	$	88,228	$	91,300

Straight-line rent liability relates to leases which have rental payments that decrease over time or one-time upfront payments for which the rental revenue is deferred and recognized on a straight-line basis.

14

American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

NOTE 7. DEBT

Debt of American Assets Trust, Inc.

American Assets Trust, Inc. does not hold any indebtedness. All debt is held directly or indirectly by the Operating Partnership; however, American Assets Trust, Inc. has guaranteed the Operating Partnership's obligations under the (i) amended and restated credit facility, (ii) term loans, (iii) senior guaranteed notes, and (iv) senior unsecured notes. Additionally, American Assets Trust, Inc. has provided a carve-out guarantee on the property-level mortgage debt at City Center Bellevue.

Debt of American Assets Trust, L.P.

Secured notes payable

The following is a summary of our total secured notes payable outstanding as of March 31, 2021 and December 31, 2020 (in thousands):

	Principal Balance as of				Stated Interest Rate		Stated Maturity Date
Description of Debt	March 31, 2021		December 31, 2020		as of March 31, 2021
City Center Bellevue (1)	111,000		111,000		3.98	%	November 1, 2022
	111,000		111,000
Debt issuance costs, net of accumulated amortization of $355 and $345, respectively	(66)		(77)
Total Secured Notes Payable Outstanding	$	110,934	$	110,923

(1)Interest only.

Certain loans require us to comply with various financial covenants. As of March 31, 2021, the Operating Partnership was in compliance with these financial covenants.

15

American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

Unsecured notes payable

The following is a summary of the Operating Partnership's total unsecured notes payable outstanding as of March 31, 2021 and December 31, 2020 (in thousands):

Description of Debt	Principal Balance as of				Stated Interest Rate			Stated Maturity Date
	March 31, 2021		December 31, 2020		as of March 31, 2021
Term Loan A	$	100,000	$	100,000	Variable		(1)	January 9, 2022
Senior Guaranteed Notes, Series A (2)	—		150,000		4.04	%	(3)	October 31, 2021
Term Loan B	100,000		100,000		Variable		(4)	March 1, 2023
Term Loan C	50,000		50,000		Variable		(5)	March 1, 2023
Senior Guaranteed Notes, Series F	100,000		100,000		3.78	%	(6)	July 19, 2024
Senior Guaranteed Notes, Series B	100,000		100,000		4.45	%		February 2, 2025
Senior Guaranteed Notes, Series C	100,000		100,000		4.50	%		April 1, 2025
Senior Guaranteed Notes, Series D	250,000		250,000		4.29	%	(7)	March 1, 2027
Senior Guaranteed Notes, Series E	100,000		100,000		4.24	%	(8)	May 23, 2029
Senior Guaranteed Notes, Series G	150,000		150,000		3.91	%	(9)	July 30, 2030
3.375% Senior Unsecured Notes	500,000		—		3.38	%		February 1, 2031
	1,550,000		1,200,000
Debt discount and issuance costs, net of accumulated amortization of $9,463 and $8,856, respectively	(13,110)		(3,323)
Total Unsecured Notes Payable	$	1,536,890	$	1,196,677

(1)The Operating Partnership has entered into an interest rate swap agreement that is intended to fix the interest rate associated with Term Loan A at approximately 4.13% through the interest rate swap maturity date of January 9, 2021, subject to adjustments based on our consolidated leverage ratio. Subsequent to January 9, 2021, the interest rate associated with Term Loan A will be variable as described below.

(2)Notes prepaid in full, with make-whole penalty thereon of approximately $3.9 million, on January 26, 2021.

(3)The Operating Partnership entered into a one-month forward-starting seven years swap contract on August 19, 2014, which was settled on September 19, 2014 at a gain of approximately $1.6 million. The forward-starting seven-year swap contract was deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 3.88% per annum. On January 26, 2021, we prepaid the entirety of the Senior Guaranteed Notes, Seres A with make-whole premium thereon.

(4)The Operating Partnership has entered into an interest rate swap agreement that is intended to fix the interest rate associated with Term Loan B at approximately 3.15% through its maturity date, subject to adjustments based on our consolidated leverage ratio. Effective March 1, 2018, the effective interest rate associated with Term Loan B is approximately 2.75%, subject to adjustments based on our consolidated leverage ratio.

(5)The Operating Partnership has entered into an interest rate swap agreement that is intended to fix the interest rate associated with Term Loan C at approximately 3.14% through its maturity date, subject to adjustments based on our consolidated leverage ratio. Effective March 1, 2018, the effective interest rate associated with Term Loan C is approximately 2.74%, subject to adjustments based on our consolidated leverage ratio.

(6)The Operating Partnership entered into a treasury lock contract on May 31, 2017, which was settled on June 23, 2017 at a loss of approximately $0.5 million. The treasury lock contract was deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 3.85% per annum.

(7)The Operating Partnership entered into forward-starting interest rate swap contracts on March 29, 2016 and April 7, 2016, which were settled on January 18, 2017 at a gain of approximately $10.4 million. Each of the forward-starting interest swap rate contracts were deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 3.87% per annum.

(8)The Operating Partnership entered into a treasury lock contract on April 25, 2017, which was settled on May 11, 2017 at a gain of approximately $0.7 million. The treasury lock contract was deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 4.18% per annum.

(9)The Operating Partnership entered into a treasury lock contract on June 20, 2019, which was settled on July 17, 2019 at a gain of approximately $0.5 million. The treasury lock contract was deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 3.88% per annum.

On January 26, 2021, the Operating Partnership issued $500 million of senior unsecured notes (the "3.375% Senior Notes") that mature February 1, 2031 and bear interest at 3.375% per annum. The 3.375% Senior Notes were priced at 98.935% of the principal amount with a yield to maturity of 3.502%. The net proceeds of the 3.375% Senior Notes, after the issuance discount, underwriting fees, and other costs were approximately $489.7 million, which were primarily used to (i) prepay our $150 million Senior Guaranteed Notes, Series A, with a make-whole payment (as defined in the Note Purchase Agreement for the Series A Notes) thereon of approximately $3.9 million, on January 26, 2021, (ii) repay our $100 million then outstanding

16

American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

balance under our Revolver Loan on January 26, 2021, (iii) fund the development of the La Jolla Commons III office building and (iv) for general corporate purposes.

Certain unsecured loans and notes require us to comply with various financial covenants. As of March 31, 2021, the Operating Partnership was in compliance with these financial covenants.

Amended Term Loan Agreement

On January 9, 2018, we entered into the Third Amendment to the Term Loan Agreement (as so amended, the "Term Loan Agreement"), which maintains the seven years $150 million unsecured term loan (referred to herein as Term Loan B and Term Loan C) to the Operating Partnership that matures on March 1, 2023 (the “$150mm Term Loan”). Effective as of March 1, 2018, borrowings under the Term Loan Agreement with respect to the $150mm Term Loan bear interest at floating rates equal to, at the Operating Partnership’s option, either (1) LIBOR, plus a spread which ranges from 1.20% to 1.70% based on the Operating Partnership’s consolidated leverage ratio, or (2) a base rate equal to the highest of (a) 0%, (b) the prime rate, (c) the federal funds rate plus 50 bps or (d) the Eurodollar rate plus 100 bps, in each case plus a spread which ranges from 0.70% to 1.35% based on the Operating Partnership’s consolidated leverage ratio. Additionally, the Operating Partnership may elect for borrowings to bear interest based on a ratings-based pricing grid as per the Operating Partnership’s then-applicable investment grade debt ratings under the terms set forth in the Term Loan Agreement.

Second Amended and Restated Credit Facility

On January 9, 2018, we entered into a second amended and restated credit agreement (the "Second Amended and Restated Credit Facility"). The Second Amended and Restated Credit Facility provides for aggregate, unsecured borrowing of $450 million, consisting of a revolving line of credit of $350 million (the "Revolver Loan") and a term loan of $100 million (the "Term Loan A"). The Second Amended and Restated Credit Facility has an accordion feature that may allow us to increase the availability thereunder up to an additional $250 million, subject to meeting specified requirements and obtaining additional commitments from lenders. At March 31, 2021, there were no amounts outstanding under the Revolver Loan and we had incurred approximately $0.7 million of debt issuance costs, net, which are recorded in other assets, net on the consolidated balance sheets.

Borrowings under the Second Amended and Restated Credit Agreement initially bear interest at floating rates equal to, at our option, either (1) LIBOR, plus a spread which ranges from (a) 1.05% to 1.50% (with respect to the Revolver Loan) and (b) 1.30% to 1.90% (with respect to Term Loan A), in each case based on our consolidated leverage ratio, or (2) a base rate equal to the highest of (a) the prime rate, (b) the federal funds rate plus 50 bps or (c) LIBOR plus 100 bps, plus a spread which ranges from (i) 0.10% to 0.50% (with respect to the Revolver Loan) and (ii) 0.30% to 0.90% (with respect to Term Loan A), in each case based on our consolidated leverage ratio. For the three months ended March 31, 2021, the weighted average interest rate on the Revolver Loan was 1.21%.

The Revolver Loan initially matures on January 9, 2022, subject to our option to extend the Revolver Loan up to two times, with each such extension for a six months period. The extension options are exercisable by us subject to the satisfaction of certain conditions.

On January 9, 2019, we entered into the first amendment (“First Amendment”) to the Second Amended and Restated Credit Facility, which extended the maturity date of Term Loan A to January 9, 2021, subject to three, one year extension options. In October 2020, we exercised an option to extend the maturity date of Term Loan A to January 9, 2022, subject to certain conditions. Additionally, in connection with the First Amendment, borrowings under the Second Amended and Restated Credit Facility with respect to Term Loan A bear interest at floating rates equal to, at our option, either (1) LIBOR, plus a spread which ranges from 1.20% to 1.70% based on our consolidated total leverage ratio, or (2) a base rate equal to the highest of (a) the prime rate, (b) the federal funds rate plus 50 bps or (c) the Eurodollar rate plus 100 bps, in each case plus a spread which ranges from 0.20% to 0.70% based on our consolidated total leverage ratio. The foregoing rates are intended to be more favorable than previously contained in the Second Amended and Restated Credit Facility (prior to entry into the First Amendment) with respect to Term Loan A.

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American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

Additionally, the Second Amended and Restated Credit Facility includes a number of customary financial covenants, including:

•A maximum leverage ratio (defined as total indebtedness net of certain cash and cash equivalents to total asset value) of 60%,

•A maximum secured leverage ratio (defined as total secured debt to secured total asset value) of 40%,

•A minimum fixed charge coverage ratio (defined as consolidated earnings before interest, taxes, depreciation and amortization to consolidated fixed charges) of 1.50x,

•A minimum unsecured interest coverage ratio of 1.75x,

•A maximum unsecured leverage ratio of 60%, and

•Recourse indebtedness at any time cannot exceed 15% of total asset value.

The Second Amended and Restated Credit Facility provides that our annual distributions may not exceed the greater of (1) 95% of our funds from operation ("FFO") or (2) the amount required for us to (a) qualify and maintain our REIT status and (b) avoid the payment of federal or state income or excise tax. If certain events of default exist or would result from a distribution, we may be precluded from making distributions other than those necessary to qualify and maintain our status as a REIT.

As of March 31, 2021, the Operating Partnership was in compliance with the financial covenants in the Second Amended and Restated Credit Facility.

NOTE 8. PARTNERS' CAPITAL OF AMERICAN ASSETS TRUST, L.P.

Noncontrolling interests in our Operating Partnership are interests in the Operating Partnership that are not owned by us. Noncontrolling interests consisted of 16,181,537 common units (the “noncontrolling common units”), and represented approximately 21.3% of the ownership interests in our Operating Partnership at March 31, 2021. Common units and shares of our common stock have essentially the same economic characteristics in that common units and shares of our common stock share equally in the total net income or loss distributions of our Operating Partnership. Investors who own common units have the right to cause our Operating Partnership to redeem any or all of their common units for cash equal to the then-current market value of one share of our common stock, or, at our election, shares of our common stock on a one-for-one basis.

During the three months ended March 31, 2021, no common units were converted into shares of our common stock.

Earnings Per Unit of the Operating Partnership

Basic earnings per unit (“EPU”) of the Operating Partnership is computed by dividing income applicable to unitholders by the weighted average Operating Partnership units outstanding, as adjusted for the effect of participating securities. Operating Partnership units granted in equity-based payment transactions that have non-forfeitable dividend equivalent rights are considered participating securities prior to vesting. The impact of unvested Operating Partnership unit awards on EPU has been calculated using the two-class method whereby earnings are allocated to the unvested Operating Partnership unit awards based on distributions and the unvested Operating Partnership units’ participation rights in undistributed earnings.

The calculation of diluted EPU for the three months ended March 31, 2021 and 2020 does not include the weighted average of 489,775 and 345,153 unvested Operating Partnership units, respectively, as these equity securities are either considered contingently issuable or the effect of including these equity securities was anti-dilutive to income from continuing operations and net income attributable to the unitholders.

NOTE 9. EQUITY OF AMERICAN ASSETS TRUST, INC.

Stockholders' Equity

On May 27, 2015, we entered into an at-the-market ("ATM") equity program with five sales agents in which we may, from time to time, offer and sell shares of our common stock having an aggregate offering price of up to $250.0 million. On March 2, 2018, we amended certain of these equity programs, terminated one such program and entered into a new equity program with one new sales agent. The sales of shares of our common stock made through the ATM equity program, as amended, are made in "at-the-market" offerings as defined in Rule 415 of the Securities Act of 1933, as amended. During the three months ended March 31, 2021, no shares of common stock were sold through the ATM equity program.

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American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

We intend to use the net proceeds from the ATM equity program to fund our development or redevelopment activities, repay amounts outstanding from time to time under our revolving line of credit or other debt financing obligations, fund potential acquisition opportunities and/or for general corporate purposes. As of March 31, 2021, we had the capacity to issue up to an additional $132.6 million in shares of our common stock under our ATM equity program upon filing an updated prospectus supplement with the SEC. Actual future sales will depend on a variety of factors including, but not limited to, market conditions, the trading price of our common stock and our capital needs. We have no obligation to sell the remaining shares available for sale under the ATM equity program.

Dividends

The following table lists the dividends declared and paid on our shares of common stock and noncontrolling common units during the three months ended March 31, 2021: 

Period	Amount per Share/Unit		Period Covered	Dividend Paid Date
First Quarter 2021	$	0.28	January 1, 2021 to March 31, 2021	March 25, 2021

Taxability of Dividends

Earnings and profits, which determine the taxability of distributions to stockholders and holders of common units, may differ from income reported for financial reporting purposes due to the differences for federal income tax purposes in the treatment of revenue recognition and compensation expense and in the basis of depreciable assets and estimated useful lives used to compute depreciation.

Stock-Based Compensation

We follow the FASB guidance related to stock-based compensation which establishes financial accounting and reporting standards for stock-based employee compensation plans, including all arrangements by which employees receive shares of stock or other equity instruments of the employer.  The guidance also defines a fair value-based method of accounting for an employee stock award or similar equity instrument.

The following table summarizes the activity of restricted stock awards during the three months ended March 31, 2021:

	Units	Weighted Average Grant Date Fair Value
Nonvested at January 1, 2021	491,957	$23.53
Granted	—	—
Vested	—	—
Forfeited	(4,006)	23.24
Nonvested at March 31, 2021	487,951	$23.54

We recognize noncash compensation expense ratably over the vesting period, and accordingly, we recognized $1.5 million and $1.3 million in noncash compensation expense for the three months ended March 31, 2021 and 2020, respectively. Unrecognized compensation expense was $6.9 million at March 31, 2021.

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American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

Earnings Per Share

We have calculated earnings per share (“EPS”) under the two-class method. The two-class method is an earnings allocation methodology whereby EPS for each class of common stock and participating security is calculated according to dividends declared and participation rights in undistributed earnings. The weighted average unvested shares outstanding, which are considered participating securities, were 489,775 and 345,153 for the three months ended March 31, 2021 and 2020, respectively. Therefore, we have allocated our earnings for basic and diluted EPS between common shares and unvested shares as these unvested shares have nonforfeitable dividend equivalent rights.

Diluted EPS is calculated by dividing the net income applicable to common stockholders for the period by the weighted average number of common and dilutive instruments outstanding during the period using the treasury stock method. For the three months ended March 31, 2021 and 2020, diluted shares exclude incentive restricted stock as these awards are considered contingently issuable. Additionally, the unvested restricted stock awards subject to time vesting are anti-dilutive for all periods presented, and accordingly, have been excluded from the weighted average common shares used to compute diluted EPS.

The computation of basic and diluted EPS is presented below (dollars in thousands, except share and per share amounts): 

	Three Months Ended March 31,
	2021		2020
NUMERATOR
Net income	$	1,733	$	15,484
Less: Net income attributable to restricted shares	(137)		(104)
Less: Income from operations attributable to unitholders in the Operating Partnership	(339)		(3,312)
Net income attributable to common stockholders—basic	$	1,257	$	12,068
Income from operations attributable to American Assets Trust, Inc. common stockholders—basic	$	1,257	$	12,068
Plus: Income from operations attributable to unitholders in the Operating Partnership	339		3,312
Net income attributable to common stockholders—diluted	$	1,596	$	15,380
DENOMINATOR
Weighted average common shares outstanding—basic	59,984,335		59,723,072
Effect of dilutive securities—conversion of Operating Partnership units	16,181,537		16,390,548
Weighted average common shares outstanding—diluted	76,165,872		76,113,620
Earnings per common share, basic	$	0.02	$	0.20
Earnings per common share, diluted	$	0.02	$	0.20

NOTE 10. INCOME TAXES

We elected to be taxed as a REIT and operate in a manner that allows us to qualify as a REIT for federal income tax purposes commencing with our initial taxable year. As a REIT, we are generally not subject to corporate level income tax on the earnings distributed currently to our stockholders that we derive from our REIT qualifying activities. Taxable income from non-REIT activities managed through our TRS is subject to federal and state income taxes.

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American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

We lease our hotel property to a wholly owned TRS that is subject to federal and state income taxes. We account for income taxes using the asset and liability method, under which deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between GAAP carrying amounts and their respective tax bases. Additionally, we classify certain state taxes as income taxes for financial reporting purposes in accordance with ASC Topic 740, Income Taxes.

A deferred tax liability is included in the other liabilities and deferred credits, net on our consolidated balance sheets of $0.6 million and $0.6 million as of March 31, 2021 and December 31, 2020, respectively, in relation to real estate asset basis differences of property subject to state taxes based on income and certain prepaid expenses of our TRS.

Income tax expense is recorded in other (expense) income, net on our consolidated statements of comprehensive income. For the three months ended March 31, 2021, we recorded income tax expense of $0.1 million. For the three months ended March 31, 2020, we recorded income tax expense of $0.2 million.

NOTE 11. COMMITMENTS AND CONTINGENCIES

Legal

We are sometimes involved in various disputes, lawsuits, warranty claims, environmental, and other matters arising in the ordinary course of business. Management makes assumptions and estimates concerning the likelihood and amount of any potential loss relating to these matters.

We are currently a party to various legal proceedings. We accrue a liability for litigation if an unfavorable outcome is probable and the amount of loss can be reasonably estimated. If an unfavorable outcome is probable and a reasonable estimate of the loss is a range, we accrue the best estimate within the range; however, if no amount within the range is a better estimate than any other amount, the minimum within the range is accrued. Legal fees related to litigation are expensed as incurred. We do not believe that the ultimate outcome of these matters, either individually or in the aggregate, could have a material adverse effect on our financial position or overall trends in results of operations; however, litigation is subject to inherent uncertainties. Also, under our leases, tenants are typically obligated to indemnify us from and against all liabilities, costs and expenses imposed upon or asserted against us as owner of the properties due to certain matters relating to the operation of the properties by the tenant.

Commitments

See Footnote 12 for description of our leases, as a lessee.

We have management agreements with Outrigger Hotels & Resorts or an affiliate thereof (“Outrigger”) pursuant to which Outrigger manages each of the retail and hotel portions of the Waikiki Beach Walk property. Under the management agreement with Outrigger relating to the retail portion of Waikiki Beach Walk (the “retail management agreement”), we pay Outrigger a monthly management fee of 3.0% of net revenues from the retail portion of Waikiki Beach Walk. Pursuant to the terms of the retail management agreement, if the agreement is terminated in certain instances, including our election not to repair damage or destruction at the property, a condemnation or our failure to make required working capital infusions, we would be obligated to pay Outrigger a termination fee equal to the sum of the management fees paid for the two months immediately preceding the termination date. The retail management agreement may not be terminated by us or by Outrigger without cause. Under our management agreement with Outrigger relating to the hotel portion of Waikiki Beach Walk (the “hotel management agreement”), we pay Outrigger a monthly management fee of 6.0% of the hotel's gross operating profit, as well as 3.0% of the hotel's gross revenues; provided that the aggregate management fee payable to Outrigger for any year shall not exceed 3.5% of the hotel's gross revenues for such fiscal year. Pursuant to the terms of the hotel management agreement, if the agreement is terminated in certain instances, including upon a transfer by us of the hotel or upon a default by us under the hotel management agreement, we would be required to pay a cancellation fee calculated by multiplying (1) the management fees for the previous 12 months by (2) (a) eight, if the agreement is terminated in the first 11 years of its term, or (b) four, three, two or one, if the agreement is terminated in the twelfth, thirteenth, fourteenth or fifteenth year, respectively, of its term. The hotel management agreement may not be terminated by us or by Outrigger without cause.

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American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

A wholly owned subsidiary of our Operating Partnership, WBW Hotel Lessee LLC, entered into a franchise license agreement with Embassy Suites Franchise LLC, the franchisor of the brand “Embassy Suites™,” to obtain the non-exclusive right to operate the hotel under the Embassy SuitesTM brand for 20 years. The franchise license agreement provides that WBW Hotel Lessee LLC must comply with certain management, operational, record keeping, accounting, reporting and marketing standards and procedures. In connection with this agreement, we are also subject to the terms of a product improvement plan pursuant to which we expect to undertake certain actions to ensure that our hotel's infrastructure is maintained in compliance with the franchisor's brand standards. In addition, we must pay to Embassy Suites Franchise LLC a monthly franchise royalty fee equal to 4.0% of the hotel's gross room revenue through December 2021 and 5.0% of the hotel's gross room revenue thereafter, as well as a monthly program fee equal to 4.0% of the hotel's gross room revenue. If the franchise license is terminated due to our failure to make required improvements or to otherwise comply with its terms, we may be liable to the franchisor for a termination payment, which could be as high as $4.9 million based on operating performance through March 31, 2021.

Our Del Monte Center property has ongoing environmental remediation related to ground water contamination. The environmental issue existed at purchase and remains in remediation. The final stages of the remediation will include routine, long term ground monitoring by the appropriate regulatory agency over the next five years to seven years. The work performed is financed through an escrow account funded by the seller upon purchase of the Del Monte Center. We believe the funds in the escrow account are sufficient for the remaining work to be performed. However, if further work is required costing more than the remaining escrow funds, we could be required to pay such overage, although we may have a contractual claim for such costs against the prior owner or our environmental remediation consultant.

Concentrations of Credit Risk

Our properties are located in Southern California, Northern California, Hawaii, Oregon, Texas, and Washington. The ability of the tenants to honor the terms of their respective leases is dependent upon the economic, regulatory, social, and health factors affecting the markets in which the tenants operate including, without limitation, the impact the COVID-19 pandemic has had on our tenants. Fifteen of our consolidated properties are located in Southern California, which exposes us to greater economic risks than if we owned a more geographically diverse portfolio. Tenants in the retail industry accounted for 25.9% of total revenues for the three months ended March 31, 2021. This makes us susceptible to demand for retail rental space and subject to the risks associated with an investment in real estate with a concentration of tenants in the retail industry. Furthermore, tenants in the office industry accounted for 52.9% of total revenues for the three months ended March 31, 2021. This makes us susceptible to demand for office rental space and subject to the risks associated with an investment in real estate with a concentration of tenants in the office industry. For the three months ended March 31, 2021 and 2020, no tenant accounted for more than 10% of our total rental revenue.

NOTE 12. LEASES

Lessor Operating Leases

We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases.

Our leases with office, retail, mixed-use and residential tenants are classified as operating leases. Leases at our office and retail properties and the retail portion of our mixed-use property generally range from three years to ten years (certain leases with anchor tenants may be longer), and in addition to minimum rents, usually provide for cost recoveries for the tenant’s share of certain operating costs. Our leases may also include variable lease payments in the form of percentage rents based on the tenant’s level of sales achieved in excess of a breakpoint threshold. Leases on apartments generally range from 7 to 15 months, with a majority having 12-month lease terms. Rooms at the hotel portion of our mixed-use property are rented on a nightly basis.

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American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

Leases at our office and retail properties and the retail portion of our mixed-use property may contain lease extension options, at our lessee's discretion. The extension options are generally for 3 to 10 years and contain primarily rent at fixed rates or the prevailing market rent. The extension options are generally exercisable 6 to 12 months prior to the expiration of the lease and require the lessee to not be in default of the lease terms.

We attempt to maximize the amount we expect to derive from the underlying real estate property following the end of a lease, to the extent it is not extended.  We maintain a proactive leasing and capital improvement program that, combined with the quality and locations of our properties, has made our properties attractive to tenants. However, the residual value of a real estate property is still subject to various market-specific, asset-specific, and tenant-specific risks and characteristics. 

As of March 31, 2021, minimum future rentals from noncancelable operating leases, before any reserve for uncollectible amounts and assuming no early lease terminations, at our office and retail properties and the retail portion of our mixed-use property are as follows (in thousands):

Year Ending December 31,
2021 (nine months ending December 31, 2021)	$	162,655
2022	215,710
2023	199,077
2024	168,525
2025	147,434
Thereafter	443,310
Total	$	1,336,711

The above future minimum rentals exclude residential leases, which typically have a term of 12 months or less, and exclude the hotel, as rooms are rented on a nightly basis.

Lessee Operating Leases

We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases.

At the Landmark at One Market, we lease, as lessee, a building adjacent to the Landmark at One Market under an operating lease effective through June 30, 2026, which we have the option to extend until 2031 by way of the remaining five years extension option (the "Annex Lease"). The lease payments under the extension option provided for under the Annex Lease will be equal to the fair rental value at the time the extension option is exercised. The extension option is included in the calculation of the right-of-use asset and lease liability as we are reasonably certain of exercising the extension option.

At Waikiki Beach Walk, we lease a portion of the building of which the tenant Quiksilver is currently in possession, under an operating lease effective through December 31, 2021.

Our lease agreements do not contain any residual value guarantees or material restrictive covenants. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement in determining the present value of lease payments.

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American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

Current annual payments under the operating leases are as follows, as of March 31, 2021 (in thousands): 

Year Ending December 31,
2021 (nine months ending December 31, 2021)	$	2,350
2022	3,232
2023	3,328
2024	3,428
2025	3,531
Thereafter	19,710
Total lease payments	$	35,579
Imputed interest	$	(6,108)
Present value of lease liability	$	29,471

Lease costs under the operating leases are as follows (in thousands):    

	Three Months Ended March 31,
	2021			2020
Operating lease cost	$	1,132		$	844
Variable lease cost	—			—
Sublease income	(1,194)			(868)
Total lease (income) cost	$	(62)		$	(24)
Weighted-average remaining lease term - operating leases (in years)	10.0
Weighted-average discount rate - operating leases	3.21		%

Supplemental cash flow information and non-cash activity related to our operating leases are as follow (in thousands):

	Three Months Ended March 31,
	2021		2020
Operating cash flow information:
Cash paid for amounts included in the measurement of lease liabilities	$	865	$	846
Non-cash activity:
Right-of-use assets obtained in exchange for operating lease obligations	$	—	$	22,188

Subleases

At the Landmark at One Market, we (as sublandlord) sublease the Annex Lease building under operating leases effective through December 31, 2029. The subleases contain extension options, subject to our ability to extend the Annex Lease, that can extend the subleases through December 31, 2039 at the fair rental value at the time the extension option is exercised.

At Waikiki Beach Walk, we (as sublandlord) sublease a portion of the building to the tenant Quiksilver under an operating lease effective through December 31, 2021.

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American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

NOTE 13. COMPONENTS OF RENTAL INCOME AND EXPENSE

The principal components of rental income are as follows (in thousands): 

	Three Months Ended March 31,
	2021		2020
Lease rental income
Office	$	43,362	$	42,213
Retail	20,853		24,955
Multifamily	11,752		11,967
Mixed-use	795		3,932
Percentage rent	526		301
Hotel revenue	3,271		8,125
Other	571		577
Total rental income	$	81,130	$	92,070

Lease rental income include $5.5 million and $2.8 million for the three months ended March 31, 2021 and 2020, respectively, to recognize lease rental income on a straight-line basis. In addition, net amortization of above and below market leases included in lease rental income were $0.8 million and $0.9 million for the three months ended March 31, 2021 and 2020, respectively.

The principal components of rental expenses are as follows (in thousands): 

	Three Months Ended March 31,
	2021		2020
Rental operating	$	9,496	$	9,882
Hotel operating	2,724		5,747
Repairs and maintenance	3,742		4,297
Marketing	393		507
Rent	1,152		853
Hawaii excise tax	532		865
Management fees	207		417
Total rental expenses	$	18,246	$	22,568

NOTE 14. OTHER (EXPENSE) INCOME, NET

The principal components of other expense, net, are as follows (in thousands):

	Three Months Ended March 31,
	2021		2020
Interest and investment income	$	74	$	312
Income tax expense	(127)		(206)
Other non-operating income	—		2
Total other (expense) income, net	$	(53)	$	108

25

American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

NOTE 15. RELATED PARTY TRANSACTIONS

During the first quarter of 2019, we terminated a lease agreement with American Assets, Inc. ("AAI"), an entity owned and controlled by Ernest Rady, our CEO, President, and Chairman of Board, and entered into a new lease agreement with AAI for office space at Torrey Reserve Campus. Rents commenced on March 1, 2019 for an initial lease term of three years at an average annual rental rate of $0.2 million. Rental revenue recognized on the AAI leases of $0.1 million and $0.0 million for the three months ended March 31, 2021 and 2020, respectively, is included in rental income on the statements of comprehensive income.

During the third quarter of 2020, we entered into a new lease with AAI for office space at Torrey Point to replace its existing lease at Torrey Reserve Campus. Rents commenced on March 1, 2021 for an initial lease term of ten years at an average annual rental rate of $0.2 million.

The Waikiki Beach Walk entities have a 47.7% investment in WBW CHP LLC, an entity that was formed to, among other things, construct a chilled water plant to provide air conditioning to the property and other adjacent facilities. The operating expenses of WBW CHP LLC are recovered through reimbursements from its members, and reimbursements to WBW CHP LLC of $0.3 million and $0.3 million for the three months ended March 31, 2021 and 2020, respectively, are included in rental expenses on the consolidated statements of comprehensive income.

NOTE 16. 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.

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American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

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

	Three Months Ended March 31,
	2021		2020
Total Office
Property revenue	$	44,464	$	44,509
Property expense	(11,364)		(11,793)
Segment profit	33,100		32,716
Total Retail
Property revenue	21,774		25,826
Property expense	(7,442)		(7,331)
Segment profit	14,332		18,495
Total Multifamily
Property revenue	12,552		12,825
Property expense	(5,491)		(5,510)
Segment profit	7,061		7,315
Total Mixed-Use
Property revenue	5,196		13,583
Property expense	(5,303)		(8,979)
Segment profit	(107)		4,604
Total segments’ profit	$	54,386	$	63,130

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

	Three Months Ended March 31,
	2021		2020
Total segments’ profit	$	54,386	$	63,130
General and administrative	(6,823)		(6,820)
Depreciation and amortization	(27,501)		(27,462)
Interest expense	(14,005)		(13,472)
Early extinguishment of debt	(4,271)		—
Other income (expense), net	(53)		108
Net income	1,733		15,484
Net income attributable to restricted shares	(137)		(104)
Net income attributable to unitholders in the Operating Partnership	(339)		(3,312)
Net income attributable to American Assets Trust, Inc. stockholders	$	1,257	$	12,068

27

American Assets Trust, Inc. and American Assets Trust, L.P.

Notes to Consolidated Financial Statements—(Continued)

March 31, 2021

(Unaudited)

The following table shows net real estate and secured note payable balances for each of the segments (in thousands):

	March 31, 2021		December 31, 2020
Net Real Estate
Office	$	1,314,179	$	1,317,107
Retail	603,522		607,918
Multifamily	387,106		389,804
Mixed-Use	176,510		177,905
	$	2,481,317	$	2,492,734
Secured Notes Payable (1)
Office	$	111,000	$	111,000
	$	111,000	$	111,000

(1)Excludes debt issuance costs of $0.1 million and $0.1 million for each of the periods ended March 31, 2021 and December 31, 2020, respectively.

Capital expenditures for each segment for the three months ended March 31, 2021 and 2020 were as follows (in thousands):

	Three Months Ended March 31,
	2021		2020
Capital Expenditures (1)
Office	$	9,527	$	18,200
Retail	1,722		3,558
Multifamily	963		1,284
Mixed-Use	4		883
	$	12,216	$	23,925

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

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

The following discussion should be read in conjunction with the consolidated financial statements and notes thereto appearing elsewhere in this report. We make statements in this report that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act). In particular, statements pertaining to our capital resources, portfolio performance and results of operations contain forward-looking statements. Likewise, all of our statements regarding anticipated growth in our funds from operations and anticipated market conditions, demographics and results of operations are forward-looking statements. You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “pro forma,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. Currently, one of the most significant risk factors, is the potential adverse effect of the current COVID-19 pandemic on our financial condition, results of operations, cash flows and performance or that of, our tenants and guests, the real estate market and the global economy and financial markets. The extent to which the COVID-19 pandemic impacts us, our tenants and guests will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others. You can also identify forward-looking statements by discussions of strategy, plans or intentions.

Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods which may be incorrect or imprecise and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements:

•the impact of epidemics, pandemics, or other outbreaks of illness, disease or virus (such as the COVID-19 pandemic) and the actions taken by government authorities and others related thereto, including the ability of our company, our properties and our tenants to operate;

•adverse economic or real estate developments in our markets;

•our failure to generate sufficient cash flows to service our outstanding indebtedness;

•defaults on, early terminations of or non-renewal of leases by tenants, including significant tenants;

•difficulties in identifying properties to acquire and completing acquisitions;

•difficulties in completing dispositions;

•our failure to successfully operate acquired properties and operations;

•our inability to develop or redevelop our properties due to market conditions;

•fluctuations in interest rates and increased operating costs;

•risks related to joint venture arrangements;

•our failure to obtain necessary outside financing;

•on-going litigation;

•general economic conditions;

•financial market fluctuations;

•risks that affect the general retail, office, multifamily and mixed-use environment;

•the competitive environment in which we operate;

•decreased rental rates or increased vacancy rates;

•conflicts of interests with our officers or directors;

•lack or insufficient amounts of insurance;

•environmental uncertainties and risks related to adverse weather conditions and natural disasters;

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•other factors affecting the real estate industry generally;

•limitations imposed on our business and our ability to satisfy complex rules in order for us to continue to qualify as a real estate investment trust, or REIT, for U.S. federal income tax purposes; and

•changes in governmental regulations or interpretations thereof, such as real estate and zoning laws and increases in real property tax rates and taxation of REITs.

While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. We disclaim any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes. For a further discussion of these and other factors, see the section entitled “Item 1A. Risk Factors” contained herein and in our annual report on Form 10-K for the year ended December 31, 2020.

Overview

References to “we,” “our,” “us” and “our company” refer to American Assets Trust, Inc., a Maryland corporation, together with our consolidated subsidiaries, including American Assets Trust, L.P., a Maryland limited partnership, of which we are the sole general partner and which we refer to in this report as our Operating Partnership.

We are a full service, vertically integrated and self-administered REIT that owns, operates, acquires and develops high quality retail, office, multifamily and mixed-use properties in attractive, high-barrier-to-entry markets in Southern California, Northern California, Oregon, Washington, Texas and Hawaii. As of March 31, 2021, our portfolio was comprised of twelve retail shopping centers; nine office properties; a mixed-use property consisting of a 369-room all-suite hotel and a retail shopping center; and six multifamily properties. Additionally, as of March 31, 2021, we owned land at three of our properties that we classified as held for development and/or construction in progress. Our core markets include San Diego; the San Francisco Bay Area; Portland, Oregon; Bellevue, Washington; and Oahu, Hawaii. We are a Maryland corporation formed on July 16, 2010 to acquire the entities owning various controlling and noncontrolling interests in real estate assets owned and/or managed by Ernest S. Rady or his affiliates, including the Ernest Rady Trust U/D/T March 13, 1983, or the Rady Trust, and did not have any operating activity until the consummation of our initial public offering on January 19, 2011. Our Company, as the sole general partner of our Operating Partnership, has control of our Operating Partnership and owned 78.8% of our Operating Partnership as of March 31, 2021. Accordingly, we consolidate the assets, liabilities and results of operations of our Operating Partnership.

Critical Accounting Policies

We identified certain critical accounting policies that affect certain of our more significant estimates and assumptions used in preparing our consolidated financial statements in our annual report on Form 10-K for the year ended December 31, 2020. We have not made any material changes to these policies during the periods covered by this report, other than those described in Footnote 1.

Same-store

We have provided certain information on a total portfolio, same-store and redevelopment same-store basis. Information provided on a same-store basis includes the results of properties that we owned and operated for the entirety of both periods being compared except for properties for which significant redevelopment or expansion occurred during either of the periods being compared, properties under development, properties classified as held for development and properties classified as discontinued operations. Information provided on a redevelopment same-store basis includes the results of properties undergoing significant redevelopment for the entirety or portion of both periods being compared. Same-store and redevelopment same-store are considered by management to be important measures because they assist in eliminating disparities due to the development, acquisition or disposition of properties during the particular period presented, and thus provides a more consistent performance measure for the comparison of the Company's stabilized and redevelopment properties, as applicable. Additionally, redevelopment same-store is considered by management to be an important measure because it assists in evaluating the timing of the start and stabilization of our redevelopment opportunities and the impact that these redevelopments have in enhancing our operating performance.

While there is judgment surrounding changes in designations, we typically reclassify significant development, redevelopment or expansion properties into same-store properties once they are stabilized. Properties are deemed stabilized typically at the earlier of (i) reaching 90% occupancy or (ii) four quarters following a property's inclusion in operating real estate. We typically remove properties from same-store properties when the development, redevelopment or expansion has or is expected to have a significant impact on the property's annualized base rent, occupancy and operating income within the

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calendar year. Our evaluation of significant impact related to development, redevelopment or expansion activity is based on quantitative and qualitative measures including, but not limited to the following: the total budgeted cost of planned construction activity compared to the property’s annualized base rent, occupancy and property operating income within the calendar year; percentage of development, redevelopment or expansion square footage to total property square footage; and the ability to maintain historic occupancy and rental rates. In consideration of these measures, we generally remove properties from same-store properties when we see a decline in a property's annualized base rent, occupancy and operating income within the calendar year as a direct result of ongoing redevelopment, development or expansion activity. Acquired properties are classified into same-store properties once we have owned such properties for the entirety of comparable period(s) and the properties are not under significant development or expansion.

Below is a summary of our same-store composition for the three months ended March 31, 2021 and 2020.  For the three months ended March 31, 2021, La Jolla Commons was reclassified to same-store properties when compared to the designation for the three months ended March 31, 2020 as it was acquired on June 20, 2019 and is comparable for the three months ended March 31, 2021. One Beach Street is classified as a non-same-store property due to redevelopment activity to renovate the property. Waikiki Beach Walk Retail and Embassy Suites™ Hotel is classified as a non-same-store property due to spalling repair activity previously disrupting the hotel portion of the properties operations. Waikele Center is classified as a non-same-store property due to significant redevelopment activity.

In our determination of same-store and redevelopment same-store properties for the three months ended March 31, 2021, Waikele Center and One Beach Street have been identified as same-store redevelopment properties due to significant redevelopment activity. Retail same-store net operating income decreased approximately 25.5% for the three months ended March 31, 2021 compared to the same period in 2020. Retail redevelopment same-store net operating income decreased approximately 22.5% for the three months ended March 31, 2021 compared to the same period in 2020. Office same-store net operating income increased 1.4% for the three months ended March 31, 2021 compared to the same period in 2020. Office redevelopment same-store net operating income increased 1.2% for the three months ended March 31, 2021 compared to the same period in 2020.

	Three Months Ended March 31,
	2021	2020
Same-Store	25	24
Non-Same-Store	3	4
Total Properties	28	28
Redevelopment Same-Store	27	26
Total Development Properties	3	3

Outlook

We seek growth in earnings, funds from operations and cash flows primarily through a combination of the following: growth in our same-store portfolio, growth in our portfolio from property development and redevelopments and expansion of our portfolio through property acquisitions. Our properties are located in some of the nation's most dynamic, high-barrier-to-entry markets primarily in Southern California, Northern California, Oregon, Washington and Hawaii, which allow us to take advantage of redevelopment opportunities that enhance our operating performance through renovation, expansion, reconfiguration and/or retenanting. We evaluate our properties on an ongoing basis to identify these types of opportunities.

We intend to opportunistically pursue the development of future phases of Lloyd Portfolio and La Jolla Commons and the redevelopment of One Beach Street based on, among other things, market conditions and our evaluation of whether such opportunities would generate appropriate risk-adjusted financial returns. Our redevelopment and development opportunities are subject to various factors, including market conditions and may not ultimately come to fruition.

We continue to review acquisition opportunities in our primary markets that would complement our portfolio and provide long-term growth opportunities. Some of our acquisitions do not initially contribute significantly to earnings growth; however, we believe they provide long-term re-leasing growth, redevelopment opportunities and other strategic opportunities. Any growth from acquisitions is contingent upon our ability to find properties that meet our qualitative standards at prices that meet

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our financial hurdles. Changes in interest rates may affect our success in achieving earnings growth through acquisitions by affecting both the price that must be paid to acquire a property, as well as our ability to economically finance a property acquisition. Generally, our acquisitions are initially financed by available cash, mortgage loans and/or borrowings under our revolving line of credit, which may be repaid later with funds raised through the issuance of new equity or new long-term debt.

COVID-19

We are closely monitoring the impact of COVID-19 pandemic on all aspects of our business and geographies, including how it will impact our tenants and business partners. We are unable to predict the impact that the COVID-19 pandemic will have on our financial condition, results of operations and cash flows due to numerous uncertainties. These uncertainties include the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact and the direct and indirect economic effects of the pandemic and containment measures, among others. The outbreak of COVID-19 in many countries, including the United States, has significantly adversely impacted global economic activity and has contributed to significant volatility and negative pressure in financial markets. The global impact of the pandemic has been rapidly evolving. Certain states and cities, including where we own properties, have development sites and where our principal place of business is located, have reacted by instituting quarantines, restrictions on travel, "stay-at-home" orders or “shelter in place” rules, social distancing measures, restrictions on types of business that may continue to operate, and/or restrictions on the types of construction projects that may continue. The Company cannot predict when restrictions or social distancing measures currently in place will expire. Even after certain of such restrictions are lifted or reduced, the willingness of customers to visit certain of our tenants' businesses may be reduced due to lingering concerns regarding the continued risk of COVID-19 transmission and heightened sensitivity to risks associated with the transmission of other diseases. As a result, the COVID-19 pandemic is negatively impacting almost every industry directly or indirectly, including industries in which the Company and our tenants operate. Further, the impacts of a potential worsening of global economic conditions and the continued disruptions to, and volatility in, the credit and financial markets, consumer spending as well as other unanticipated consequences remain unknown.

In addition, we cannot predict the impact that COVID-19 will have on our tenants and other business partners; however, any material effect on these parties could adversely impact us. For the first quarter of 2021, we have collected to date approximately 99% of office rents, 84% of retail rents (including retail component of Waikiki Beach Walk) and 95% of multifamily rents that were due during the first quarter of 2021. During the first quarter of 2021, we received and executed a significant amount of rent deferment requests from various tenants, primarily within the retail segment, as a result of COVID-19. We are evaluating each tenant rent deferment request on an individual basis, considering a number of factors. Not all rent deferment requests will ultimately result in executed lease modification agreements. As of March 31, 2021, we have entered into lease modifications that resulted in adjustments (including rent deferrals and other monetary lease concessions) due to the impact of the COVID-19 pandemic for approximately $1.2 million or 2% of the rent originally contracted for the three months ended March 31, 2021. For the first quarter of 2021, we collected approximately $0.7 million or 88% of the deferred rent repayments due during the period.

We believe the company's financial condition and liquidity are currently strong. Although there is uncertainty related to the anticipated impact of the COVID-19 outbreak on the Company's future results, we believe our efficient business model and ongoing steps we have taken to strengthen our balance sheet has positioned to manage our business through this crisis as it continues to unfold. We continue to manage all aspects of our business including, but not limited to, monitoring the financial health of our tenants, vendors, and other third-party relationships, and developing new opportunities for growth. Due to the COVID-19 pandemic, we cannot reasonably estimate with any degree of certainty the future impact COVID-19 may have on the Company’s results of operations, financial position, and liquidity.

We remain encouraged by our portfolio’s increasing rent collection percentages as well as the broader macroeconomic conditions related to the ongoing transition back to a fully opened economy. While we continue to monitor the COVID-19 vaccination response and economic initiatives undertaken by the new administration, we are hopeful that a continued reopening of the economy in 2021 will result in both job growth and an increase in gross domestic product as compared to 2020.

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Leasing

Our same-store growth is primarily driven by increases in rental rates on new leases and lease renewals and changes in portfolio occupancy. Over the long-term, we believe that the infill nature and strong demographics of our properties provide us with a strategic advantage, allowing us to maintain relatively high occupancy and increase rental rates. Furthermore, we believe the locations of our properties and diversified portfolio will mitigate some of the potentially negative impact of the current economic environment. However, in the short-term due to the COVID-19 pandemic, we have seen a meaningful negative impact on certain of our tenants operations and ability to pay rent, primarily in the retail sector; and any reduction in our tenants' abilities to pay base rent, percentage rent or other charges, including as a result of the COVID-19 pandemic, will adversely affect our financial condition and results of operations.

During the three months ended March 31, 2021, we signed 14 office leases for a total of 65,047 square feet of office space including 65,047 square feet of comparable renewal office space leases (leases for which there was a prior tenant), at an average rental rate decrease on a cash basis of 2.3% and increase on a GAAP basis of 1.3%, respectively. New office leases for comparable spaces were signed for 5,333 square feet at an average rental rate increase on a cash and GAAP basis of 9.2% and 20.9%, respectively. Renewals for comparable office spaces were signed for 59,714 square feet at an average rental rate decrease on a cash and GAAP basis of 3.4% and 0.5%, respectively. Tenant improvements and incentives were $61.61 per square foot of office space for comparable new leases for the three months ended March 31, 2021, mainly due to tenants at Torrey Reserve Campus.

During the three months ended March 31, 2021, we signed 25 retail leases for a total of 59,274 square feet of retail space including 46,243 square feet of comparable renewal retail space leases (leases for which there was a prior tenant), at an average rental rate decrease on a cash basis and GAAP basis of 7.8% and 5.0%, respectively. No new retail leases for comparable spaces were signed during the first quarter of 2021.

The rental increases associated with comparable spaces generally include all leases signed in arms-length transactions reflecting market leverage between landlords and tenants during the period. The comparison between average rent for expiring leases and new leases is determined by including minimum rent and percentage rent paid on the expiring lease and minimum rent and, in some instances, projections of first lease year percentage rent, to be paid on the new lease. In some instances, management exercises judgment as to how to most effectively reflect the comparability of spaces reported in this calculation. The change in rental income on comparable space leases is impacted by numerous factors including current market rates, location, individual tenant creditworthiness, use of space, market conditions when the expiring lease was signed, capital investment made in the space and the specific lease structure. Tenant improvements and incentives include the total dollars committed for the improvement of a space as it relates to a specific lease, but may also include base-building costs (i.e. expansion, escalators or new entrances) which are required to make the space leasable. Incentives include amounts paid to tenants as an inducement to sign a lease that do not represent building improvements.

The leases signed in 2021 generally become effective over the following year, though some may not become effective until 2022 and beyond. Further, there is risk that some new tenants will not ultimately take possession of their space and that tenants for both new and renewal leases may not pay all of their contractual rent due to operating, financing or other matters. However, we believe that these increases do provide information about the tenant/landlord relationship and the potential fluctuations we may achieve in rental income over time.

Through the remainder of 2021, we believe our leasing volume will be below our historical averages and result in overall decreases in rental income due to the COVID-19 pandemic. However, changes in rental income associated with individual signed leases on comparable spaces may be positive or negative.

Capitalized Costs

Certain external and internal costs directly related to the development and redevelopment of real estate, including pre-construction costs, real estate taxes, insurance, interest, construction costs and salaries and related costs of personnel directly involved, are capitalized. We capitalize costs under development until construction is substantially complete and the property is held available for occupancy. The determination of when a development project is substantially complete and when capitalization must cease involves a degree of judgment. We consider a construction project as substantially complete and held available for occupancy upon the completion of landlord-owned tenant improvements or when the lessee takes possession of the unimproved space for construction of its own improvements, but not later than one year from cessation of major construction activity. We cease capitalization on the portion substantially completed and occupied or held available for occupancy, and capitalize only those costs associated with any remaining portion under construction.

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We capitalized external and internal costs related to both development and redevelopment activities combined of $3.9 million and $1.3 million for the three months ended March 31, 2021 and 2020, respectively.

We capitalized external and internal costs related to other property improvements combined of $9.3 million and $20.8 million for the three months ended March 31, 2021 and 2020, respectively.

Interest costs on developments and major redevelopments are capitalized as part of developments and redevelopments not yet placed in service. Capitalization of interest commences when development activities and expenditures begin and end upon completion, which is when the asset is ready for its intended use as noted above. We make judgments as to the time period over which to capitalize such costs and these assumptions have a direct impact on net income because capitalized costs are not subtracted in calculating net income. If the time period for capitalizing interest is extended, however, more interest is capitalized, thereby decreasing interest expense and increasing net income during that period. We capitalized interest costs related to development activities of $0.6 million and $0.3 million for the three months ended March 31, 2021 and 2020, respectively. We capitalized interest costs related to development activities of $0.6 million and $0.3 million for the three months ended March 31, 2021 and 2020, respectively.

Results of Operations

For our discussion of results of operations, we have provided information on a total portfolio and same-store basis.

Comparison of the three months ended March 31, 2021 to the three months ended March 31, 2020

The following summarizes our consolidated results of operations for the three months ended March 31, 2021 compared to our consolidated results of operations for the three months ended March 31, 2020. As of March 31, 2021, our operating portfolio was comprised of 28 retail, office, multifamily and mixed-use properties with an aggregate of approximately 6.6 million rentable square feet of retail and office space, including the retail portion of our mixed-use property, 2,112 residential units (including 122 RV spaces) and a 369-room hotel. Additionally, as of March 31, 2021, we owned land at three of our properties that we classified as held for development and/or construction in progress. As of March 31, 2020, our operating portfolio was comprised of 28 retail, office, multifamily and mixed-use properties with an aggregate of approximately 6.6 million rentable square feet of retail and office space, including the retail portion of our mixed-use property, 2,112 residential units (including 122 RV spaces) and a 369-room hotel. Additionally, as of March 31, 2020, we owned land at three of our properties that we classified as held for development and/or construction in progress.

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The following table sets forth selected data from our unaudited consolidated statements of comprehensive income for the three months ended March 31, 2021 and 2020 (dollars in thousands):

	Three Months Ended March 31,				Change		%
	2021		2020
Revenues
Rental income	$	81,130	$	92,070	$	(10,940)	(12)	%
Other property income	2,856		4,673		(1,817)		(39)
Total property revenues	83,986		96,743		(12,757)		(13)
Expenses
Rental expenses	18,246		22,568		(4,322)		(19)
Real estate taxes	11,354		11,045		309		3
Total property expenses	29,600		33,613		(4,013)		(12)
Total property income	54,386		63,130		(8,744)		(14)
General and administrative	(6,823)		(6,820)		(3)		—
Depreciation and amortization	(27,501)		(27,462)		(39)		—
Interest expense	(14,005)		(13,472)		(533)		4
Early extinguishment of debt	(4,271)		—		(4,271)		—
Other (expense) income, net	(53)		108		(161)		(149)
Net income	1,733		15,484		(13,751)		(89)
Net income attributable to restricted shares	(137)		(104)		(33)		32
Net income attributable to unitholders in the Operating Partnership	(339)		(3,312)		2,973		(90)
Net income attributable to American Assets Trust, Inc. stockholders	$	1,257	$	12,068	$	(10,811)	(90)	%

Revenue

Total property revenues. Total property revenue consists of rental revenue and other property income. Total property revenue decreased $12.8 million, or 13%, to $84.0 million for the three months ended March 31, 2021 compared to $96.7 million for the three months ended March 31, 2020. The percentage leased was as follows for each segment as of March 31, 2021 and 2020:

	Percentage Leased(1)
	March 31,
	2021		2020
Office	91.4	%	94.3	%
Retail	90.8	%	95.2	%
Multifamily	91.9	%	93.0	%
Mixed-Use (2)	88.2	%	98.5	%

(1)The percentage leased includes the square footage under lease, including leases which may not have commenced as of March 31, 2021 or 2020, as applicable.

(2)Includes the retail portion of the mixed-use property only.

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The decrease in total property revenue was attributable primarily to the decrease in lease termination fees and factors discussed below.

Rental revenues. Rental revenue includes minimum base rent, cost reimbursements, percentage rents and other rents. Rental revenue decreased $10.9 million, or 12%, to $81.1 million for the three months ended March 31, 2021 compared to $92.1 million for the three months ended March 31, 2020. Rental revenue by segment was as follows (dollars in thousands):

	Total Portfolio								Same-Store Portfolio(1)
	Three Months Ended March 31,				Change		%		Three Months Ended March 31,				Change		%
	2021		2020						2021		2020
Office	$	43,636	$	42,513	$	1,123	3		$	43,418	$	42,092	$	1,326	3
Retail	21,484		25,291		(3,807)		(15)		17,483		21,241		(3,758)		(18)
Multifamily	11,815		12,014		(199)		(2)		11,815		12,014		(199)		(2)
Mixed-Use	4,195		12,252		(8,057)		(66)		—		—		—		—
	$	81,130	$	92,070	$	(10,940)	(12)	%	$	72,716	$	75,347	$	(2,631)	(3)	%

(1)For this table and tables following, the same-store portfolio excludes: (i) Waikele Center due to significant redevelopment activity; (ii) One Beach Street due to the renovation of the building; (iii) Waikiki Beach Walk Retail and Embassy SuitesTM Hotel due to significant spalling repair activity; and (iv) land held for development.

Total office rental revenue increased $1.1 million for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 primarily due to higher annualized base rents at La Jolla Commons, City Center Bellevue, Lloyd Portfolio, and Torrey Reserve Campus. The increase in total office rental revenue is partially offset by the decrease in rental revenue of approximately $0.2 million at One Beach Street due to expiration of leases to allow for the modernization of the property and the decrease in rental revenue at First & Main due to the reduction of leased space related to tenant extensions in 2020.

Total retail rental revenue decreased $3.8 million for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 primarily due to approximately $2.4 million for tenants who were changed to alternate rent or to cash basis of revenue recognition during 2020 as the collectability was determined to be no longer probable for certain tenants at Alamo Quarry Market, Carmel Mountain Plaza, Del Monte Center and The Shops at Kalakaua. Additionally, the decrease in total retail rental revenue is also attributable to a decrease in expense recoveries and lease modifications providing rent concessions.

Multifamily revenue decreased $0.2 million for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 primarily due to the decrease in average occupancy to 89.3% for the three months ended March 31, 2021 compared to 92.6% for the three months ended March 31, 2020. The decrease in occupancy is primarily due to Hassalo on Eighth - Residential as the result of the significant impact of the COVID-19 pandemic and social unrest had on the Portland multifamily market. We expect this trend to reverse with the distribution of the COVID-19 vaccine, government restrictions being lifted and appropriate lease concessions being offered.

Total mixed-use rental revenue decreased $8.1 million for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 primarily due to the COVID-19 pandemic reducing tourism and hotel occupancy through hotel reservation cancellations and travel restrictions during the second and third quarters which led to a decrease in average occupancy and revenue per available room to 47.5% and $99 for the three months ended March 31, 2021, respectively, compared to 75.4% and $242 for three months ended March 31, 2020, respectively. The decrease in tourism and hotel occupancy in Oahu due to the COVID-19 pandemic is expected to substantially reduce rental revenue at the hotel portion of the mixed-use property through at least the first half of 2021. The decrease in total mixed-use rental revenue is also attributed to approximately $2.1 million for tenants who were changed to alternate rent or to cash basis of revenue recognition during 2020 and an increase in bad debt contra-revenue of approximately $0.2 million and straight-line rent of approximately $0.3 million as the collectability was determined to be no longer probable for certain tenants at the retail portion of our mixed-use property.

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Other property income. Other property income decreased $1.8 million, or 39%, to $2.9 million for the three months ended March 31, 2021 compared to $4.7 million for the three months ended March 31, 2020. Other property income by segment was as follows (dollars in thousands):

	Total Portfolio								Same-Store Portfolio
	Three Months Ended March 31,				Change		%		Three Months Ended March 31,				Change		%
	2021		2020						2021		2020
Office	$	828	$	1,996	$	(1,168)	(59)		$	803	$	1,985	$	(1,182)	(60)
Retail	290		535		(245)		(46)		122		359		(237)		(66)
Multifamily	737		811		(74)		(9)		737		811		(74)		(9)
Mixed-Use	1,001		1,331		(330)		(25)		—		—		—		—
	$	2,856	$	4,673	$	(1,817)	(39)	%	$	1,662	$	3,155	$	(1,493)	(47)	%

Office other property income decreased $1.2 million for the three months ended March 31, 2021 primarily due to the decrease in parking garage income at City Center Bellevue, Lloyd Portfolio, and First & Main as the "stay-at home" order issued by state and local governments related to the COVID-19 pandemic during the second quarter of 2020 caused a substantial portion of our tenants employees and their guests to continue to partially work from home during the period. Additionally, the decrease in office other property income was also attributable to a decrease in lease termination fees received at City Center Bellevue and a decrease in construction management fee income received at Lloyd Portfolio during the period.

Retail other property income decreased $0.2 million for the three months ended March 31, 2021 primarily due a decrease in lease termination fees received at Alamo Quarry Market during the period.

Multifamily other property income decreased by $0.1 million for the three months ended March 31, 2021 primarily due to the decrease in parking garage income at Hassalo on Eighth - Residential and late fees.

Mixed-use other property income decreased $0.3 million for the three months ended March 31, 2021 primarily due to the COVID-19 pandemic reducing tourism and hotel occupancy beginning in March 2020 which led to a decrease in excise tax and food & beverage revenue at the hotel portion of our mixed-use property. The decrease in tourism and hotel occupancy in Oahu due to the COVID-19 pandemic is expected to substantially reduce mixed-use other property income through at least the first half of 2021.

Property Expenses

Total Property Expenses. Total property expenses consist of rental expenses and real estate taxes. Total property expenses decreased $4.0 million, or 12%, to $29.6 million, for the three months ended March 31, 2021 compared to $33.6 million for the three months ended March 31, 2020.

Rental Expenses. Rental expenses decreased $4.3 million, or 19%, to $18.2 million for the three months ended March 31, 2021 compared to $22.6 million for the three months ended March 31, 2020. Rental expense by segment was as follows (dollars in thousands):

	Total Portfolio								Same-Store Portfolio
	Three Months Ended March 31,				Change		%		Three Months Ended March 31,				Change		%
	2021		2020						2021		2020
Office	$	6,682	$	7,162	$	(480)	(7)		$	6,473	$	6,942	$	(469)	(7)
Retail	3,527		3,569		(42)		(1)		2,817		2,846		(29)		(1)
Multifamily	3,786		3,843		(57)		(1)		3,786		3,843		(57)		(1)
Mixed-Use	4,251		7,994		(3,743)		(47)		—		—		—		—
	$	18,246	$	22,568	$	(4,322)	(19)	%	$	13,076	$	13,631	$	(555)	(4)	%

Total office rental expenses decreased $0.5 million for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 primarily due to a decrease in utilities expense, janitorial services and supplies, and repairs and maintenance as the "stay-at home" order issued by state and local governments related to the COVID-19 pandemic during the second quarter of 2020 caused a substantial portion of our tenants' employees to continue to split working from home during the period. The decrease in total office rental expenses was partially offset by the increase in sublease expense related to the Annex Lease extension option exercised in March 2020 and insurance expense during the period.

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Mixed-use rental expense decreased $3.7 million for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 primarily due to a decrease in hotel room expenses, marketing expenses, and general excise tax expenses at the hotel portion of our mixed-use property during the period. The decrease in tourism and hotel occupancy in Oahu due to the COVID-19 pandemic is expected to substantially reduce rental expenses at the hotel portion of our mixed-use property through at least the first half of 2021. Additionally, the decrease in mixed-use rental expenses is also due to the decrease of general excise tax, repairs and maintenance, management fees, and utilities expenses at the retail portion of our mixed-use property during the period.

Real Estate Taxes. Real estate taxes increased $0.3 million, or 3%, to $11.4 million for the three months ended March 31, 2021 compared to $11.0 million for the three months ended March 31, 2020. Real estate tax expense by segment was as follows (dollars in thousands):

	Total Portfolio								Same-Store Portfolio
	Three Months Ended March 31,				Change		%		Three Months Ended March 31,				Change		%
	2021		2020						2021		2020
Office	$	4,682	$	4,631	$	51	1		$	4,624	$	4,456	$	168	4
Retail	3,915		3,762		153		4		3,081		3,035		46		2
Multifamily	1,705		1,667		38		2		1,705		1,667		38		2
Mixed-Use	1,052		985		67		7		—		—		—		—
	$	11,354	$	11,045	$	309	3	%	$	9,410	$	9,158	$	252	3	%

Same-store office real estate taxes increased $0.2 million compared to the three months ended March 31, 2020 primarily due to an increase in tax assessments at La Jolla Commons, The Landmark at One Market, First and Main, and Torrey Reserve Campus during the period.

Total retail real estate taxes increased $0.2 million for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 primarily due to an increase in tax assessment at Waikele Center.

Property Operating Income

Property operating income decreased $8.7 million, or 14%, to $54.4 million for the three months ended March 31, 2021, compared to $63.1 million for the three months ended March 31, 2020. Property operating income by segment was as follows (dollars in thousands):

	Total Portfolio								Same-Store Portfolio
	Three Months Ended March 31,				Change		%		Three Months Ended March 31,				Change		%
	2021		2020						2021		2020
Office	$	33,100	$	32,716	$	384	1		$	33,124	$	32,679	$	445	1
Retail	14,332		18,495		(4,163)		(23)		11,707		15,719		(4,012)		(26)
Multifamily	7,061		7,315		(254)		(3)		7,061		7,315		(254)		(3)
Mixed-Use	(107)		4,604		(4,711)		(102)		—		—		—		—
	$	54,386	$	63,130	$	(8,744)	(14)	%	$	51,892	$	55,713	$	(3,821)	(7)	%

Total office property operating income increased $0.4 million for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 primarily due to higher annualized base rents at La Jolla Commons, City Center Bellevue, Lloyd Portfolio and Torrey Reserve Campus during the period. The increase in total office property operating income was partially offset by the decrease in rental revenue at One Beach Street due to the expiration of leases to allow for the modernization of the property, a decrease in parking garage income, and an increase in sublease expense related to the Annex Lease extension option exercised in March 2020 during the period.

Total retail property operating income decreased $4.2 million for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 primarily due to approximately $2.4 million for tenants who were changed to alternate rent or to cash basis of revenue recognition during 2020 as the collectability was determined to be no longer probable for certain tenants at Alamo Quarry Market, Carmel Mountain Plaza, Del Monte Center and The Shops at Kalakaua. Additionally, the decrease in total retail property operating income is also attributable to a decrease in expense recoveries and lease modifications providing rent concessions.

Total multifamily property operating income decreased $0.3 million for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 primarily due to the decrease in average occupancy to 89.3% for the three months ended March 31, 2021 compared to 92.6% for the three months ended March 31, 2020, and the decrease in parking garage income at Hassalo on Eighth - Residential and late fees during the period.

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Total mixed-use property operating income decreased $4.7 million for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 primarily due to the decrease in rental revenue of approximately $2.1 million for tenants who were changed to alternate rent or to cash basis of revenue recognition during 2020 and an increase in bad debt contra-revenue of approximately $0.2 million and straight-line rent of approximately $0.3 million as the collectability was determined to be no longer probable for certain tenants at the retail portion of our mixed-use property. Additionally, the decrease in property operating income was due to the impact of the COVID-19 pandemic reducing tourism and hotel occupancy which led to a decrease in hotel occupancy and revenue per available room to 47.5% and $99 for the three months ended March 31, 2021 compared to 75.4% and $242 for the three months ended March 31, 2020. The decrease in tourism and hotel occupancy in Oahu due to the COVID-19 pandemic is expected to substantially reduce property other property income through at least the first half of 2021.

Other

General and Administrative. General and administrative expenses remained consistent at $6.8 million for the three months ended March 31, 2021, compared to $6.8 million for the three months ended March 31, 2020. This increase was primarily due to an increase in employee-related costs.

Depreciation and Amortization. Depreciation and amortization expense remained consistent at $27.5 million for the three months ended March 31, 2021, compared to $27.5 million for the three months ended March 31, 2020. This increase was primarily due to higher depreciation and amortization at The Landmark at One Market and City Center Bellevue due to tenant improvements that were put into service in 2020 and 2021 and an increase in depreciation at One Beach attributed to the renovation and modernization of the building substantially offset by lower depreciation and amortization at First & Main, La Jolla Commons, and Waikele Center due to decreased capital expenditures in 2020.

Interest Expense. Interest expense increased $0.5 million, or 4%, to $14.0 million for the three months ended March 31, 2021, compared to $13.5 million for the three months ended March 31, 2020. This increase was primarily due to the closing of our 3.375% Senior Notes on January 26, 2021 partially offset by a decrease in interest expense related to our repayment of the Series A Notes on January 26, 2021, decrease in weighted average interest rate for our Term Loan A, which became an unhedged variable rate loan when the interest rate swap expired on January 9, 2021, and an increase in capitalized interest related to our development projects.

Early Extinguishment of Debt. Early extinguishment of debt expense increased $4.3 million for the three months ended March 31, 2021 due to the prepayment of the Senior Guaranteed Notes, Series A, with make-whole payment thereon, on January 26, 2021.

Other (Expense) Income, Net. Other (expense) income, net decreased $0.2 million, or 149%, to other expense, net of $0.1 million for the three months ended March 31, 2021, compared to other income, net of $0.1 million for the three months ended March 31, 2020 primarily due to the decrease in interest and investment income attributed to the lower yield on our average cash balance during the period and a decrease in income tax expense related to lower taxable income for our taxable REIT subsidiary.

Liquidity and Capital Resources of American Assets Trust, Inc.

In this “Liquidity and Capital Resources of American Assets Trust, Inc.” section, the term the “company” refers only to American Assets Trust, Inc. on an unconsolidated basis, and excludes the Operating Partnership and all other subsidiaries.

The company’s business is operated primarily through the Operating Partnership, of which the company is the parent company and sole general partner, and which it consolidates for financial reporting purposes.  Because the company operates on a consolidated basis with the Operating Partnership, the section entitled “Liquidity and Capital Resources of American Assets Trust, L.P.” should be read in conjunction with this section to understand the liquidity and capital resources of the company on a consolidated basis and how the company is operated as a whole.

The company issues public equity from time to time, but does not otherwise generate any capital itself or conduct any business itself, other than incurring certain expenses in operating as a public company which are fully reimbursed by the Operating Partnership. The company itself does not have any indebtedness, and its only material asset is its ownership of partnership interests of the Operating Partnership. Therefore, the consolidated assets and liabilities and the consolidated revenues and expenses of the company and the Operating Partnership are the same on their respective financial statements.  However, all debt is held directly or indirectly by the Operating Partnership. The company’s principal funding requirement is the payment of dividends on its common stock. The company’s principal source of funding for its dividend payments is distributions it receives from the Operating Partnership.

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As of March 31, 2021, the company owned an approximate 78.8% partnership interest in the Operating Partnership. The remaining approximately 21.3% are owned by non-affiliated investors and certain of the company's directors and executive officers. As the sole general partner of the Operating Partnership, American Assets Trust, Inc. has the full, exclusive and complete authority and control over the Operating Partnership’s day-to-day management and business, can cause it to enter into certain major transactions, including acquisitions, dispositions and refinancings, and can cause changes in its line of business, capital structure and distribution policies. The company causes the Operating Partnership to distribute such portion of its available cash as the company may in its discretion determine, in the manner provided in the Operating Partnership’s partnership agreement.

The liquidity of the company is dependent on the Operating Partnership’s ability to make sufficient distributions to the company. The primary cash requirement of the company is its payment of dividends to its stockholders. The company also guarantees some of the Operating Partnership’s debt, as discussed further in Note 7 of the Notes to Consolidated Financial Statements included elsewhere herein. If the Operating Partnership fails to fulfill certain of its debt requirements, which trigger the company’s guarantee obligations, then the company will be required to fulfill its cash payment commitments under such guarantees. However, the company’s only significant asset is its investment in the Operating Partnership.

We believe the Operating Partnership’s sources of working capital, specifically its cash flow from operations, and borrowings available under its unsecured line of credit, are adequate for it to make its distribution payments to the company and, in turn, for the company to make its dividend payments to its stockholders. As of March 31, 2021, the company has determined that it has adequate working capital to meet its dividend funding obligations for the next 12 months. However, we cannot assure you that the Operating Partnership’s sources of capital will continue to be available at all or in amounts sufficient to meet its needs, including its ability to make distribution payments to the company. The unavailability of capital could adversely affect the Operating Partnership’s ability to pay its distributions to the company, which would in turn, adversely affect the company’s ability to pay cash dividends to its stockholders. The COVID-19 pandemic is expected to temporarily impact some of our tenants' ability or willingness to remit rent payments due to the tenants' operations being affected by state and local stay-at-home orders. In the first quarter of 2021, we continued to receive rent deferment and other rent concession requests from some tenants and have been negotiating and executing lease modifications for the deferment of rent and other rent concessions. These rent deferments and other rent concessions will continue to adversely affect the Operating Partnership's cash flow from operations until the scheduled repayment period.

Our short-term liquidity requirements consist primarily of funds to pay for future dividends expected to be paid to the company’s stockholders, operating expenses and other expenditures directly associated with our properties, interest expense and scheduled principal payments on outstanding indebtedness, general and administrative expenses, funding construction projects, capital expenditures, tenant improvements and leasing commissions.

The company may from time to time seek to repurchase or redeem the Operating Partnership’s outstanding debt, the company’s shares of common stock or other securities in open market purchases, privately negotiated transactions or otherwise. Such repurchases or redemptions, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

For the company to maintain its qualification as a REIT, it must pay dividends to its stockholders aggregating annually at least 90% of its REIT taxable income, excluding net capital gains. While historically the company has satisfied this distribution requirement by making cash distributions to American Assets Trust, Inc.'s stockholders or American Assets Trust, L.P.'s unitholders, it may choose to satisfy this requirement by making distributions of cash or other property, including, in limited circumstances, the company’s own stock. As a result of this distribution requirement, the Operating Partnership cannot rely on retained earnings to fund its ongoing operations to the same extent that other companies whose parent companies are not REITs can. The company may need to continue to raise capital in the equity markets to fund the operating partnership’s working capital needs, acquisitions and developments. Although there is no intent at this time, if market conditions deteriorate, the company may also delay the timing of future development and redevelopment projects as well as limit future acquisitions, reduce the Operating Partnership’s operating expenditures, or re-evaluate its dividend policy.

The company is a well-known seasoned issuer. As circumstances warrant, the company may issue equity from time to time on an opportunistic basis, dependent upon market conditions and available pricing. When the company receives proceeds from preferred or common equity issuances, it is required by the Operating Partnership’s partnership agreement to contribute the proceeds from its equity issuances to the Operating Partnership in exchange for partnership units of the Operating Partnership. The Operating Partnership may use the proceeds to repay debt, to develop new or existing properties, to acquire properties or for general corporate purposes.

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In January 2021, the company filed a universal shelf registration statement on Form S-3ASR with the SEC, which became effective upon filing and which replaced the prior Form S-3ASR that was filed with the SEC in February 2018. The universal shelf registration statement permits the company from time to time to offer and sell equity securities of the company.  However, there can be no assurance that the company will be able to complete any such offerings of securities.  Factors influencing the availability of additional financing include investor perception of our prospects and the general condition of the financial markets, among others.

In May 2015, we entered into an ATM equity program with five sales agents in which we may, from time to time, offer and sell shares of our common stock having an aggregate offering price of up to $250.0 million. On March 2, 2018, we amended certain of these equity programs, terminated one such program and entered into a new equity program with one new sales agent. The sales of shares of the company's common stock made through the ATM equity program, as amended, are made in “at-the-market” offerings as defined in Rule 415 of the Securities Act. As of March 31, 2021, we had the capacity to issue up to an additional $132.6 million in shares of common stock under the ATM equity program upon filing an updated prospectus supplement with the SEC. We intend to use the net proceeds to fund development or redevelopment activities, repay amounts outstanding from time to time under our amended and restated credit facility or other debt financing obligations, fund potential acquisition opportunities and/or for general corporate purposes. Actual future sales will depend on a variety of factors including, but not limited to, market conditions, the trading price of the company's common stock and the company's capital needs. We have no obligation to sell the remaining shares available for sale under the ATM equity program.

Liquidity and Capital Resources of American Assets Trust, L.P.

In this “Liquidity and Capital Resources of American Assets Trust, L.P.” section, the terms “we,” “our” and “us” refer to the Operating Partnership together with its consolidated subsidiaries, or the Operating Partnership and American Assets Trust, Inc. together with their consolidated subsidiaries, as the context requires. American Assets Trust, Inc. is our sole general partner and consolidates our results of operations for financial reporting purposes. Because we operate on a consolidated basis with American Assets Trust, Inc., the section entitled “Liquidity and Capital Resources of American Assets Trust, Inc.” should be read in conjunction with this section to understand our liquidity and capital resources on a consolidated basis.

Due to the nature of our business, we typically generate significant amounts of cash from operations. The cash generated from operations is used for the payment of operating expenses, capital expenditures, debt service and dividends to American Assets Trust, Inc.'s stockholders and our unitholders. As a REIT, American Assets Trust, Inc. must generally make annual distributions to its stockholders of at least 90% of its net taxable income. As of March 31, 2021, we held $380.4 million in cash and cash equivalents.

Our short-term liquidity requirements consist primarily of operating expenses and other expenditures associated with our properties, regular debt service requirements, dividend payments to American Assets Trust, Inc.'s stockholders required to maintain its REIT status, distributions to our unitholders, capital expenditures and, potentially, acquisitions. We expect to meet our short-term liquidity requirements through net cash provided by operations, reserves established from existing cash and, if necessary, borrowings available under our credit facility.

Our long-term liquidity needs consist primarily of funds necessary to pay for the repayment of debt at maturity, property acquisitions, tenant improvements and capital improvements. We expect to meet our long-term liquidity requirements to pay scheduled debt maturities and to fund property acquisitions and capital improvements with net cash from operations, long-term secured and unsecured indebtedness and, if necessary, the issuance of equity and debt securities. We also may fund property acquisitions and capital improvements using our amended and restated credit facility pending permanent financing. We believe that we have access to multiple sources of capital to fund our long-term liquidity requirements, including the incurrence of additional debt and the issuance of additional equity. However, we cannot be assured that this will be the case. Our ability to incur additional debt will be dependent on a number of factors, including our degree of leverage, the value of our unencumbered assets and borrowing restrictions that may be imposed by lenders. Our ability to access the equity capital markets will be dependent on a number of factors as well, including general market conditions for REITs and market perceptions about our company.

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Our overall capital requirements for the remainder of 2021 and first quarter 2022 will depend upon acquisition opportunities and the level of improvements and redevelopments on existing properties. Our capital investments will be funded on a short-term basis with, among other sources of capital, cash on hand, cash flow from operations and/or our revolving line of credit. On a long-term basis, our capital investments may be funded with additional long-term debt, including, without limitation, mortgage debt and unsecured notes. Our ability to incur additional debt will be dependent on a number of factors, including, without limitation, our degree of leverage, the value of our unencumbered assets and borrowing restrictions that may be imposed by lenders. Our capital investments may also be funded by issuing additional equity including, without limitation, shares issued by American Assets Trust, Inc. under its ATM equity program or through an underwritten public offering. Although there is no intent at this time, if market conditions deteriorate or fail to improve, including as a result of the COVID-19 pandemic, we may also delay the timing of future development and redevelopment projects as well as limit future acquisitions, reduce our operating expenditures, or re-evaluate our dividend policy. The COVID-19 pandemic is expected to impact the timing of future development and redevelopment projects due to, among other things, capital requirements and permitting delays caused by local government shutdowns or reduced operations.

In January 2021, the Operating Partnership filed a universal shelf registration on Form S-3 ASR with the SEC which provided for the registration of an unspecified amount of debt securities by the Operating Partnership. However, there can be no assurance that the Operating Partnership will be able to complete any such offerings of debt securities. Factors influencing the availability of additional financing include investor perception of our prospects and the general condition of the financial markets, among others.

Off-Balance Sheet Arrangements

We currently do not have any off-balance sheet arrangements.

Cash Flows

Comparison of the three months ended March 31, 2021 to the three months ended March 31, 2020

Cash, cash equivalents, and restricted cash were $382.2 million and $56.8 million at March 31, 2021 and 2020, respectively.

Net cash provided by operating activities decreased $2.9 million to $42.5 million for the three months ended March 31, 2021 compared to $45.4 million for the three months ended March 31, 2020. The decrease in cash from operations was primarily due to the decrease in rental revenue from our mixed-use property and a decrease in rent collections from our retail portfolio.

Net cash used in investing activities decreased $11.7 million to $12.2 million for the three months ended March 31, 2021 compared to $23.9 million for the three months ended March 31, 2020. The decrease was primarily due to the decrease in capital expenditures for tenant improvements at City Center Bellevue, Torrey Reserve, and Waikele Center.

Net cash provided by financing activities increased $286.9 million to $212.8 million for the three months ended March 31, 2021 compared to cash used in financing activities of $74.1 million for the three months ended March 31, 2020. The increase in cash provided by financing activities was primarily due to the closing of our issuance of 3.375% Senior Notes on January 26, 2021 partially offset by the repayment of both the outstanding balance on the revolving line of credit and the Senior Guaranteed Notes, Series A on January 26, 2021.

Net Operating Income

Net Operating Income, or NOI, is a non-GAAP financial measure of performance. We define NOI as operating revenues (rental income, tenant reimbursements, lease termination fees, ground lease rental income and other property income) less property and related expenses (property expenses, ground lease expense, property marketing costs, real estate taxes and insurance). NOI excludes general and administrative expenses, interest expense, depreciation and amortization, acquisition-related expense, other nonproperty income and losses, gains and losses from property dispositions, extraordinary items, tenant improvements, and leasing commissions. Other REITs may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to the NOIs of other REITs.

NOI is used by investors and our management to evaluate and compare the performance of our properties and to determine trends in earnings and to compute the fair value of our properties as it is not affected by (1) the cost of funds of the property owner, (2) the impact of depreciation and amortization expenses as well as gains or losses from the sale of operating

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real estate assets that are included in net income computed in accordance with GAAP or (3) general and administrative expenses and other gains and losses that are specific to the property owner. The cost of funds is eliminated from net income because it is specific to the particular financing capabilities and constraints of the owner. The cost of funds is also eliminated because it is dependent on historical interest rates and other costs of capital as well as past decisions made by us regarding the appropriate mix of capital, which may have changed or may change in the future. Depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets are eliminated because they may not accurately represent the actual change in value in our retail, office, multifamily or mixed-use properties that result from use of the properties or changes in market conditions. While certain aspects of real property do decline in value over time in a manner that is intended to be captured by depreciation and amortization, the value of the properties as a whole have historically increased or decreased as a result of changes in overall economic conditions instead of from actual use of the property or the passage of time. Gains and losses from the sale of real property vary from property to property and are affected by market conditions at the time of sale, which will usually change from period to period. These gains and losses can create distortions when comparing one period to another or when comparing our operating results to the operating results of other real estate companies that have not made similarly timed purchases or sales. We believe that eliminating these costs from net income is useful because the resulting measure captures the actual revenue generated and actual expenses incurred in operating our properties as well as trends in occupancy rates, rental rates and operating costs.

However, the usefulness of NOI is limited because it excludes general and administrative costs, interest expense, interest income and other expense, depreciation and amortization expense and gains or losses from the sale of properties, and other gains and losses as stipulated by GAAP, the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, all of which are significant economic costs. NOI may fail to capture significant trends in these components of net income, which further limits its usefulness.

NOI is a measure of the operating performance of our properties but does not measure our performance as a whole. NOI is therefore not a substitute for net income as computed in accordance with GAAP. This measure should be analyzed in conjunction with net income computed in accordance with GAAP and discussions elsewhere in “Management's Discussion and Analysis of Financial Condition and Results of Operations” regarding the components of net income that are eliminated in the calculation of NOI. Other companies may use different methods for calculating NOI or similarly entitled measures and, accordingly, our NOI may not be comparable to similarly entitled measures reported by other companies that do not define the measure exactly as we do.  

The following is a reconciliation of our NOI to net income for the three months ended March 31, 2021 and 2020 computed in accordance with GAAP (in thousands):

	Three Months Ended March 31,
	2021		2020
Net operating income	$	54,386	$	63,130
General and administrative	(6,823)		(6,820)
Depreciation and amortization	(27,501)		(27,462)
Interest expense	(14,005)		(13,472)
Early extinguishment of debt	(4,271)		—
Other (expense) income, net	(53)		108
Net income	$	1,733	$	15,484

Funds from Operations

We calculate funds from operations, or FFO, in accordance with the standards established by the National Association of Real Estate Investment Trusts, or NAREIT. FFO represents net income (computed in accordance with GAAP), excluding gains (or losses) from sales of depreciable operating property, impairment losses, real-estate related depreciation and amortization (excluding amortization of deferred financing costs) and after adjustments for unconsolidated partnerships and joint ventures.

FFO is a supplemental non-GAAP financial measure. Management uses FFO as a supplemental performance measure because it believes that FFO is beneficial to investors as a starting point in measuring our operational performance. Specifically, in excluding real-estate related depreciation and amortization and gains and losses from property dispositions, which do not relate to or are not indicative of operating performance, FFO provides a performance measure that, when compared year over year, captures trends in occupancy rates, rental rates and operating costs. We also believe that, as a widely recognized measure of the performance of REITs, FFO will be used by investors as a basis to compare our operating performance with that of other

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REITs. However, because FFO excludes depreciation and amortization and captures neither the changes in the value of our properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effects and could materially impact our results from operations, the utility of FFO as a measure of our performance is limited. In addition, other equity REITs may not calculate FFO in accordance with the NAREIT definition as we do, and, accordingly, our FFO may not be comparable to such other REITs' FFO. Accordingly, FFO should be considered only as a supplement to net income as a measure of our performance. FFO should not be used as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs, including our ability to pay dividends or service indebtedness. FFO also should not be used as a supplement to or substitute for cash flow from operating activities computed in accordance with GAAP.

The following table sets forth a reconciliation of our FFO for the three months ended March 31, 2021 to net income, the nearest GAAP equivalent (in thousands, except per share and share data): 

	Three Months Ended March 31,
	2021
Funds from Operations (FFO)
Net income	$	1,733
Plus: Real estate depreciation and amortization	27,501
Funds from operations	29,234
Less: Nonforfeitable dividends on incentive restricted stock awards	(135)
FFO attributable to common stock and units	$	29,099
FFO per diluted share/unit	$	0.38
Weighted average number of common shares and units, diluted (1)	76,170,653

(1)The weighted average common shares used to compute FFO per diluted share include unvested restricted stock awards that are subject to time vesting, which were excluded from the computation of diluted EPS, as the vesting of the restricted stock awards is dilutive in the computation of FFO per diluted share but is anti-dilutive for the computation of diluted EPS for the period. Diluted shares exclude incentive restricted stock as these awards are considered contingently issuable.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our future income, cash flows and fair values relevant to financial instruments are dependent upon prevalent market interest rates. Market risk refers to the risk of loss from adverse changes in market prices and interest rates. We manage our market risk by attempting to match anticipated inflow of cash from our operating, investing and financing activities with anticipated outflow of cash to fund debt payments, dividends to our stockholders and Operating Partnership unitholders, investments, capital expenditures and other cash requirements.

Interest Rate Risk

Outstanding Debt

The following discusses the effect of hypothetical changes in market rates of interest on the fair value of our total outstanding debt. Interest rate risk amounts were determined by considering the impact of hypothetical interest rates on our debt. Discounted cash flow analysis is generally used to estimate the fair value of our mortgages payable. Considerable judgment is necessary to estimate the fair value of financial instruments. This analysis does not purport to take into account all of the factors that may affect our debt, such as the effect that a changing interest rate environment could have on the overall level of economic activity or the action that our management might take to reduce our exposure to the change. This analysis assumes no change in our financial structure.

Fixed Interest Rate Debt

Our outstanding notes payable obligations (maturing at various times through February 2031) have fixed interest rates which limit the risk of fluctuating interest rates. However, interest rate fluctuations may affect the fair value of our fixed rate debt instruments. At March 31, 2021, we had $1.411 billion of fixed rate debt outstanding with an estimated fair value of $1.435 billion. The carrying values of our revolving line of credit and term loan are deemed to be at fair value since the outstanding debt is directly tied to monthly LIBOR contracts. Additionally, we consider our $250.0 million term loans outstanding as of March 31, 2021 to be fixed rate debt as the rate is effectively fixed by an interest rate swap agreement. If interest rates at March 31, 2021 had been 1.0% higher, the fair value of those debt instruments on that date would have

44

decreased by approximately $76.3 million. If interest rates at March 31, 2021 had been 1.0% lower, the fair value of those debt instruments on that date would have increased by approximately $91.8 million.

Variable Interest Rate Debt

At March 31, 2021, we had $250.0 million of variable rate debt outstanding. We have historically entered into forward starting interest rate swaps in order to economically hedge against the risk of rising interest rates that would affect our interest expense related to our future anticipated debt issuances as part of its overall borrowing program. See the discussion under Note 4 to the accompanying consolidated financial statements for certain quantitative details related to the interest rate swaps and for a discussion on how we value derivative financial instruments.  Based upon this amount of variable rate debt and the specific terms, if market interest rates increased 1.0%, our annual interest expense would increase by approximately $1.0 million with a corresponding decrease in our net income and cash flows for the year. Conversely, if market rates decreased 1.0%, our annual interest expense would decrease by approximately $1.0 million with a corresponding increase in our net income and cash flows for the year.

ITEM 4. CONTROLS AND PROCEDURES

Controls and Procedures (American Assets Trust, Inc.)

American Assets Trust, Inc. maintains disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in American Assets Trust, Inc.'s reports under the Exchange Act is processed, recorded, summarized and reported within the time periods specified in the rules and regulations of the SEC and that such information is accumulated and communicated to management, including American Assets Trust, Inc.'s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

American Assets Trust, Inc. has carried out an evaluation, under the supervision and with the participation of management, including American Assets Trust, Inc.'s Chief Executive Officer and Chief Financial Officer, regarding the effectiveness of its disclosure controls and procedures as of March 31, 2021, the end of the period covered by this report. Based on the foregoing, its Chief Executive Officer and Chief Financial Officer have concluded, as of March 31, 2021, that American Assets Trust, Inc.'s disclosure controls and procedures were effective in ensuring that information required to be disclosed by it in reports filed or submitted under the Exchange Act (1) is processed, recorded, summarized and reported within the time periods specified in the SEC’s rules and forms and (2) is accumulated and communicated to its management, including American Assets Trust, Inc.'s Chief Executive Officer and its Chief Financial Officer, as appropriate to allow for timely decisions regarding required disclosure.

No changes to American Assets Trust, Inc.'s internal control over financial reporting were identified in connection with the evaluation referenced above that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, American Assets Trust, Inc.'s internal control over financial reporting.

Controls and Procedures (American Assets Trust, L.P.)

The Operating Partnership maintains disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in its reports under the Exchange Act is processed, recorded, summarized and reported within the time periods specified in the rules and regulations of the SEC and that such information is accumulated and communicated to management, including the Operating Partnership's Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

45

The Operating Partnership has carried out an evaluation, under the supervision and with the participation of management, including its Chief Executive Officer and Chief Financial Officer, regarding the effectiveness of its disclosure controls and procedures as of March 31, 2021, the end of the period covered by this report. Based on the foregoing, its Chief Executive Officer and Chief Financial Officer have concluded, as of March 31, 2021, that the Operating Partnership's disclosure controls and procedures were effective in ensuring that information required to be disclosed by it in reports filed or submitted under the Exchange Act (1) is processed, recorded, summarized and reported within the time periods specified in the SEC’s rules and forms and (2) is accumulated and communicated to its management, including its Chief Executive Officer and Chief Financial Officer, as appropriate to allow for timely decisions regarding required disclosure.

No changes to the Operating Partnership's internal control over financial reporting were identified in connection with the evaluation referenced above that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Operating Partnership's internal control over financial reporting.

PART II—OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are not currently a party, as plaintiff or defendant, to any legal proceedings that we believe to be material or which, individually or in the aggregate, would be expected to have a material effect on our business, financial condition or results of operation if determined adversely to us. We may be subject to on-going litigation, relating to our portfolio and the properties comprising our portfolio, and we expect to otherwise be party from time to time to various lawsuits, claims and other legal proceedings that arise in the ordinary course of our business.

ITEM 1A. RISK FACTORS

There have been no material changes to the risk factors included in Item 1A. “Risk Factors” in our annual report on Form 10-K for the year ended December 31, 2020.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

46

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

Exhibit No.	Description
4.2 (1)	Indenture, dated January 26, 2021, by and among American Assets Trust, L.P., as issuer, American Assets Trust, Inc., as guarantor, and U.S. Bank National Association, as trustee
31.1*	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of American Assets Trust, Inc.
31.2*	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of American Assets Trust, L.P.
31.3*	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of American Assets Trust, Inc.
31.4*	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of American Assets Trust, L.P.
32.1*	Certification of Chief Executive Officer and Chief Financial Officer of American Assets Trust, Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2*	Certification of Chief Executive Officer and Chief Financial Officer of American Assets Trust, L.P. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

*    Filed herewith.

(1)    Incorporated herein by reference to American Assets Trust, Inc.’s Current Report on Form 8-K filed with the Securities and Exchange Commission on January 26, 2021.

47

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto authorized.

American Assets Trust, Inc.		American Assets Trust, L.P.
		By: American Assets Trust, Inc.
		Its: General Partner
/s/ ERNEST RADY		/s/ ERNEST RADY
Ernest Rady		Ernest Rady
Chairman, President and Chief Executive Officer		Chairman, President and Chief Executive Officer
(Principal Executive Officer)		(Principal Executive Officer)
/s/ ROBERT F. BARTON		/s/ ROBERT F. BARTON
Robert F. Barton		Robert F. Barton
Executive Vice President, Chief Financial Officer		Executive Vice President, Chief Financial Officer
(Principal Financial and Accounting Officer)		(Principal Financial and Accounting Officer)
Date:	April 30, 2021	Date:	April 30, 2021

48

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT

TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Ernest Rady, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of American Assets Trust, 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; and

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.

Date:	April 30, 2021	/s/ ERNEST RADY
		Ernest Rady
		Chairman, President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT

TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Ernest Rady, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of American Assets Trust, L.P.;

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; and

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.

Date:	April 30, 2021	/s/ ERNEST RADY
		Ernest Rady
		Chairman, President and Chief Executive Officer

EX-31.3

Exhibit 31.3

CERTIFICATION PURSUANT

TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Robert F. Barton, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of American Assets Trust, 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; and

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.

Date:	April 30, 2021	/s/ ROBERT F. BARTON
		Robert F. Barton
		EVP and Chief Financial Officer

EX-31.4

Exhibit 31.4

CERTIFICATION PURSUANT

TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Robert F. Barton, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of American Assets Trust, L.P.;

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; and

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.

Date:	April 30, 2021	/s/ ROBERT F. BARTON
		Robert F. Barton
		EVP and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION

The undersigned, Ernest Rady and Robert F. Barton, the Chief Executive Officer and Chief Financial Officer, respectively, of American Assets Trust, Inc. (the “Company”), pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, each hereby certifies that, to the best of his knowledge:

(i) the Quarterly Report for the period ended March 31, 2021 of the Company (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ ERNEST RADY

Ernest Rady

Chairman, President and Chief Executive Officer

/s/ ROBERT F. BARTON

Robert F. Barton

EVP and Chief Financial Officer

Date: April 30, 2021

EX-32.2

Exhibit 32.2

CERTIFICATION

The undersigned, Ernest Rady and Robert F. Barton, the Chief Executive Officer and Chief Financial Officer, respectively, of American Assets Trust, L.P. (the “Operating Partnership”), pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, each hereby certifies that, to the best of his knowledge:

(i) the Quarterly Report for the period ended March 31, 2021 of the Operating Partnership (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Operating Partnership.

/s/ ERNEST RADY

Ernest Rady

Chairman, President and Chief Executive Officer

/s/ ROBERT F. BARTON

Robert F. Barton

EVP and Chief Financial Officer

Date: April 30, 2021

XML

Cover Page - shares	3 Months Ended
	Mar. 31, 2021	Apr. 30, 2021
Document Information [Line Items]
Amendment Flag	false
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q1
Entity Central Index Key	0001500217
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2021
Document Transition Report	false
Entity Registrant Name	AMERICAN ASSETS TRUST, INC.
Entity File Number	001-35030
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	27-3338708
Entity Address, Address Line One	3420 Carmel Mountain Road
Entity Address, Address Line Two	Suite 100
Entity Address, City or Town	San Diego
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92121
City Area Code	858
Local Phone Number	350-2600
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	AAT
Security Exchange Name	NYSE
Entity Common Stock, Shares Outstanding		60,472,286
American Assets Trust, L.P.
Document Information [Line Items]
Entity Central Index Key	0001509570
Entity Registrant Name	AMERICAN ASSETS TRUST, L.P.
Entity File Number	333-202342-01
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	27-3338894
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
ASSETS
Operating real estate	$ 3,164,594	$ 3,155,280
Construction in progress	93,001	91,047
Held for development	547	547
Total Real estate, at cost	3,258,142	3,246,874
Accumulated depreciation	(776,825)	(754,140)
Real estate, net	2,481,317	2,492,734
Cash and cash equivalents	380,434	137,333
Restricted cash	1,716	1,716
Accounts receivable, net	6,031	6,938
Deferred rent receivables, net	76,690	72,476
Other assets, net	103,158	106,112
Total assets	3,049,346	2,817,309
LIABILITIES AND EQUITY
Secured notes payable, net	110,934	110,923
Unsecured notes payable, net	1,536,890	1,196,677
Unsecured line of credit, net	0	99,151
Accounts payable and accrued expenses	71,226	59,262
Security deposits payable	6,629	6,590
Other liabilities and deferred credits, net	88,228	91,300
Total liabilities	1,813,907	1,563,903
Commitments and contingencies (Note 11)
American Assets Trust, Inc. stockholders’ equity
Common stock, $0.01 par value, 490,000,000 shares authorized, 60,472,286 and 60,476,292 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively	605	605
Additional paid-in capital	1,447,128	1,445,644
Accumulated dividends in excess of net income	(192,098)	(176,560)
Accumulated other comprehensive income	1,964	1,753
Total American Assets Trust, Inc. stockholders’ equity	1,257,599	1,271,442
Noncontrolling interests	(22,160)	(18,036)
Total equity	1,235,439	1,253,406
CAPITAL:
TOTAL LIABILITIES AND EQUITY	3,049,346	2,817,309
American Assets Trust, L.P.
ASSETS
Operating real estate	3,164,594	3,155,280
Construction in progress	93,001	91,047
Held for development	547	547
Total Real estate, at cost	3,258,142	3,246,874
Accumulated depreciation	(776,825)	(754,140)
Real estate, net	2,481,317	2,492,734
Cash and cash equivalents	380,434	137,333
Restricted cash	1,716	1,716
Accounts receivable, net	6,031	6,938
Deferred rent receivables, net	76,690	72,476
Other assets, net	103,158	106,112
Total assets	3,049,346	2,817,309
LIABILITIES AND EQUITY
Secured notes payable, net	110,934	110,923
Unsecured notes payable, net	1,536,890	1,196,677
Unsecured line of credit, net	0	99,151
Accounts payable and accrued expenses	71,226	59,262
Security deposits payable	6,629	6,590
Other liabilities and deferred credits, net	88,228	91,300
Total liabilities	1,813,907	1,563,903
Commitments and contingencies (Note 11)
American Assets Trust, Inc. stockholders’ equity
Accumulated other comprehensive income	3,016	2,737
CAPITAL:
Limited partners' capital, 16,181,537 and 16,181,537 units issued and outstanding as of March 31, 2021 and December 31, 2020, respectively	(23,212)	(19,020)
General partner's capital, 60,472,286 and 60,476,292 units issued and outstanding as of March 31, 2021 and December 31, 2020, respectively	1,255,635	1,269,689
Total capital	1,235,439	1,253,406
TOTAL LIABILITIES AND EQUITY	$ 3,049,346	$ 2,817,309

XML

Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2021	Mar. 31, 2020
REVENUE:
Rental income		$ 81,130	$ 92,070
Other property income		2,856	4,673
Total revenue		83,986	96,743
EXPENSES:
Rental expenses		18,246	22,568
Real estate taxes		11,354	11,045
General and administrative		6,823	6,820
Depreciation and amortization		27,501	27,462
Total operating expenses		63,924	67,895
OPERATING INCOME		20,062	28,848
Interest expense		(14,005)	(13,472)
Early extinguishment of debt		(4,271)	0
Other (expense) income, net		(53)	108
NET INCOME		1,733	15,484
Net income attributable to restricted shares		(137)	(104)
Net income attributable to unitholders in the Operating Partnership		(339)	(3,312)
NET INCOME ATTRIBUTABLE TO AMERICAN ASSETS TRUST, INC. STOCKHOLDERS		$ 1,257	$ 12,068
EARNINGS PER COMMON SHARE
Earnings per common share, basic (in USD per share)		$ 0.02	$ 0.20
Weighted average shares of common stock outstanding-basic (in shares)		59,984,335	59,723,072
EARNINGS PER COMMON SHARE, DILUTED
Earnings per common share, diluted (in USD per share)		$ 0.02	$ 0.20
Weighted average shares of common stock outstanding-diluted (in shares)		76,165,872	76,113,620
Dividends declared per common share (in USD per share)		$ 0.28	$ 0.30
COMPREHENSIVE INCOME
Net income		$ 1,733	$ 15,484
Reclassification of amortization of forward-starting swap realized gains included in interest expense		(275)	(333)
Comprehensive income		2,012	9,036
Comprehensive income attributable to non-controlling interests		(407)	(1,941)
Comprehensive income attributable to American Assets Trust, Inc.		1,605	7,095
Interest Expense
COMPREHENSIVE INCOME
Reclassification of amortization of forward-starting swap realized gains included in interest expense		(275)	(333)
Senior Guaranteed Notes, Series A
COMPREHENSIVE INCOME
Reclassification of amortization of forward-starting swap realized gains included in interest expense		(193)
Senior Guaranteed Notes, Series A | Early Extinguishment of Debt
COMPREHENSIVE INCOME
Reclassification of amortization of forward-starting swap realized gains included in interest expense		(193)	0
American Assets Trust, L.P.
REVENUE:
Rental income		81,130	92,070
Other property income		2,856	4,673
Total revenue		83,986	96,743
EXPENSES:
Rental expenses		18,246	22,568
Real estate taxes		11,354	11,045
General and administrative		6,823	6,820
Depreciation and amortization		27,501	27,462
Total operating expenses		63,924	67,895
OPERATING INCOME		20,062	28,848
Interest expense		(14,005)	(13,472)
Early extinguishment of debt		(4,271)	0
Other (expense) income, net		(53)	108
NET INCOME		1,733	15,484
Net income attributable to restricted shares		(137)	(104)
NET INCOME ATTRIBUTABLE TO AMERICAN ASSETS TRUST, INC. STOCKHOLDERS		$ 1,596	$ 15,380
EARNINGS PER COMMON SHARE
Earnings per common share, basic (in USD per share)		$ 0.02	$ 0.20
Weighted average shares of common stock outstanding-basic (in shares)		76,165,872	76,113,620
EARNINGS PER COMMON SHARE, DILUTED
Earnings per common share, diluted (in USD per share)		$ 0.02	$ 0.20
Weighted average shares of common stock outstanding-diluted (in shares)		76,165,872	76,113,620
Distributions per unit (in USD per share)		$ 0.28	$ 0.30
COMPREHENSIVE INCOME
Net income		$ 1,733	$ 15,484
Reclassification of amortization of forward-starting swap realized gains included in interest expense		(275)	(333)
Comprehensive income		2,012	9,036
American Assets Trust, L.P. | Interest Expense
COMPREHENSIVE INCOME
Reclassification of amortization of forward-starting swap realized gains included in interest expense		(275)	(333)
American Assets Trust, L.P. | Senior Guaranteed Notes, Series A
COMPREHENSIVE INCOME
Reclassification of amortization of forward-starting swap realized gains included in interest expense		(193)
American Assets Trust, L.P. | Senior Guaranteed Notes, Series A | Early Extinguishment of Debt
COMPREHENSIVE INCOME
Reclassification of amortization of forward-starting swap realized gains included in interest expense		(193)	0
Limited Partner | American Assets Trust, L.P.
EXPENSES:
NET INCOME	[1]	339	3,312
COMPREHENSIVE INCOME
Net income	[1]	339	3,312
Comprehensive income attributable to American Assets Trust, Inc.		(407)	(1,941)
General Partner | American Assets Trust, L.P.
EXPENSES:
NET INCOME	[2]	1,394	12,172
COMPREHENSIVE INCOME
Net income	[2]	1,394	12,172
Comprehensive income attributable to American Assets Trust, Inc.		1,605	7,095
Interest Rate Swap
COMPREHENSIVE INCOME
Other comprehensive gain - change in value of interest rate swaps		747	(6,115)
Interest Rate Swap | American Assets Trust, L.P.
COMPREHENSIVE INCOME
Other comprehensive gain - change in value of interest rate swaps		$ 747	$ (6,115)

[1] Consists of limited partnership interests held by third parties.

[2] Consists of general partnership interests held by American Assets Trust, Inc.

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Consolidated Statement of Equity (Unaudited) - USD ($) $ in Thousands	Total	Senior Guaranteed Notes, Series A	American Assets Trust, L.P.	American Assets Trust, L.P. Senior Guaranteed Notes, Series A	American Assets Trust, L.P. Accumulated Other Comprehensive Income (Loss)	American Assets Trust, L.P. Accumulated Other Comprehensive Income (Loss) Senior Guaranteed Notes, Series A	American Assets Trust, L.P. Limited Partner		American Assets Trust, L.P. General Partner		Common Shares	Common Shares American Assets Trust, L.P. General Partner	Additional Paid-in Capital	Accumulated Dividends in Excess of Net Income	Accumulated Other Comprehensive Income (Loss)	Accumulated Other Comprehensive Income (Loss) Senior Guaranteed Notes, Series A	Noncontrolling Interests - Unitholders in the Operating Partnership	Noncontrolling Interests - Unitholders in the Operating Partnership Senior Guaranteed Notes, Series A	Swap	Swap American Assets Trust, L.P.	Swap American Assets Trust, L.P. Accumulated Other Comprehensive Income (Loss)	Swap Accumulated Other Comprehensive Income (Loss)	Swap Noncontrolling Interests - Unitholders in the Operating Partnership
Beginning Balance (shares) at Dec. 31, 2019											60,068,228
Beginning Balance at Dec. 31, 2019	$ 1,293,672										$ 601		$ 1,452,014	$ (144,378)	$ 5,680		$ (20,245)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	15,484		$ 15,484				$ 3,312	[1]	$ 12,172	[2]				12,172			3,312
Dividends declared and paid	(22,937)													(18,020)
Dividends declared and paid (noncontrolling interest)																	(4,917)
Stock-based compensation	1,250												1,250
Other comprehensive gain - change in value of interest rate swaps																			$ (6,115)	$ (6,115)	$ (6,115)	$ (4,816)	$ (1,299)
Reclassification of amortization of forward-starting swap included in interest expense	(333)		(333)		$ (333)										(261)		(72)
Ending Balance (shares) at Mar. 31, 2020											60,068,228
Ending Balance at Mar. 31, 2020	1,281,021										$ 601		1,453,264	(150,226)	603		(23,221)
Beginning partners' capital account (shares) at Dec. 31, 2019							16,390,548	[1]	60,068,228	[2]
Beginning partners' capital account at Dec. 31, 2019			1,293,672		7,716		$ (22,281)	[1]	$ 1,308,237	[2]
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income	15,484		15,484				3,312	[1]	12,172	[2]				12,172			3,312
Distributions			(22,937)				$ (4,917)	[1]	(18,020)	[2]
Stock-based compensation			1,250						$ 1,250	[2]
Other comprehensive gain - change in value of interest rate swaps																			(6,115)	(6,115)	(6,115)	(4,816)	(1,299)
Reclassification of amortization of forward-starting swap included in interest expense	$ (333)		(333)		(333)										(261)		(72)
Ending partners' capital account (shares) at Mar. 31, 2020							16,390,548	[1]	60,068,228	[2]
Ending partners' capital account at Mar. 31, 2020			1,281,021		1,268		$ (23,886)	[1]	$ 1,303,639	[2]
Beginning Balance (shares) at Dec. 31, 2020	60,476,292										60,476,292
Beginning Balance at Dec. 31, 2020	$ 1,253,406										$ 605		1,445,644	(176,560)	1,753		(18,036)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	1,733		1,733				$ 339	[1]	$ 1,394	[2]				1,394			339
Forfeiture of restricted stock (shares)											(4,006)	(4,006)
Dividends declared and paid	(21,463)													(16,932)
Dividends declared and paid (noncontrolling interest)																	(4,531)
Stock-based compensation	1,484												1,484
Other comprehensive gain - change in value of interest rate swaps																			747	747	747	579	168
Reclassification of amortization of forward-starting swap included in interest expense	$ (275)	$ (193)	(275)	$ (193)	(275)	$ (193)									(216)	$ (152)	(59)	$ (41)
Ending Balance (shares) at Mar. 31, 2021	60,472,286										60,472,286
Ending Balance at Mar. 31, 2021	$ 1,235,439										$ 605		$ 1,447,128	(192,098)	1,964		(22,160)
Beginning partners' capital account (shares) at Dec. 31, 2020							16,181,537		60,476,292
Beginning partners' capital account at Dec. 31, 2020			1,253,406		2,737		$ (19,020)		$ 1,269,689
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income	1,733		1,733				339	[1]	1,394	[2]				$ 1,394			339
Forfeiture of restricted stock (shares)											(4,006)	(4,006)
Distributions			(21,463)				$ (4,531)	[1]	(16,932)	[2]
Stock-based compensation			1,484						$ 1,484	[2]
Other comprehensive gain - change in value of interest rate swaps																			$ 747	$ 747	$ 747	$ 579	$ 168
Reclassification of amortization of forward-starting swap included in interest expense	$ (275)	$ (193)	(275)	$ (193)	(275)	$ (193)									$ (216)	$ (152)	$ (59)	$ (41)
Ending partners' capital account (shares) at Mar. 31, 2021							16,181,537		60,472,286
Ending partners' capital account at Mar. 31, 2021			$ 1,235,439		$ 3,016		$ (23,212)		$ 1,255,635

[1] Consists of limited partnership interests held by third parties.

[2] Consists of general partnership interests held by American Assets Trust, Inc.

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Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2021	Mar. 31, 2020
OPERATING ACTIVITIES
Net income		$ 1,733	$ 15,484
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred rent revenue and amortization of lease intangibles		(6,292)	(3,762)
Depreciation and amortization		27,501	27,462
Amortization of debt issuance costs and debt discounts		577	374
Early extinguishment of debt		4,271	0
Provision for uncollectable rental income		3,213	370
Stock-based compensation expense		1,484	1,250
Other noncash interest expense		(275)	(333)
Other, net		32	(3,940)
Changes in operating assets and liabilities
Change in accounts receivable		(1,841)	3,632
Change in other assets		651	616
Change in accounts payable and accrued expenses		11,098	4,435
Change in security deposits payable		39	30
Change in other liabilities and deferred credits		314	(257)
Net cash provided by operating activities		42,505	45,361
INVESTING ACTIVITIES
Capital expenditures		(11,372)	(20,531)
Leasing commissions		(844)	(3,394)
Net cash used in investing activities		(12,216)	(23,925)
FINANCING ACTIVITIES
Repayment of secured notes payable		0	(51,003)
Repayment of unsecured line of credit		(100,000)	0
Proceeds from unsecured notes payable		494,675	0
Repayments of Unsecured Debt		(155,375)	0
Debt issuance costs		(5,025)	0
Proceeds from issuance of common stock, net		0	(119)
Dividends paid to common stock and unitholders		(21,463)	(22,937)
Net cash provided by (used in) financing activities		212,812	(74,059)
Net increase (decrease) in cash and cash equivalents		243,101	(52,623)
Cash, cash equivalents and restricted cash, beginning of period		139,049	109,451
Cash, cash equivalents and restricted cash, end of period		382,150	56,828
Cash and cash equivalents		380,434	52,371
Restricted cash		1,716	4,457
Noncontrolling Interests - Unitholders in the Operating Partnership
OPERATING ACTIVITIES
Net income		339	3,312
American Assets Trust, L.P.
OPERATING ACTIVITIES
Net income		1,733	15,484
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred rent revenue and amortization of lease intangibles		(6,292)	(3,762)
Depreciation and amortization		27,501	27,462
Amortization of debt issuance costs and debt discounts		577	374
Early extinguishment of debt		4,271	0
Provision for uncollectable rental income		3,213	370
Stock-based compensation expense		1,484	1,250
Other noncash interest expense		(275)	(333)
Other, net		32	(3,940)
Changes in operating assets and liabilities
Change in accounts receivable		(1,841)	3,632
Change in other assets		651	616
Change in accounts payable and accrued expenses		11,098	4,435
Change in security deposits payable		39	30
Change in other liabilities and deferred credits		314	(257)
Net cash provided by operating activities		42,505	45,361
INVESTING ACTIVITIES
Capital expenditures		(11,372)	(20,531)
Leasing commissions		(844)	(3,394)
Net cash used in investing activities		(12,216)	(23,925)
FINANCING ACTIVITIES
Repayment of secured notes payable		0	(51,003)
Repayment of unsecured line of credit		(100,000)	0
Proceeds from unsecured notes payable		494,675	0
Repayments of Unsecured Debt		(155,375)	0
Debt issuance costs		(5,025)	0
Contributions from American Assets Trust, Inc.		0
Contributions from American Assets Trust, Inc.			(119)
Dividends paid to common stock and unitholders		(21,463)	(22,937)
Net cash provided by (used in) financing activities		212,812	(74,059)
Net increase (decrease) in cash and cash equivalents		243,101	(52,623)
Cash, cash equivalents and restricted cash, beginning of period		139,049	109,451
Cash, cash equivalents and restricted cash, end of period		382,150	56,828
Cash and cash equivalents		380,434	52,371
Restricted cash		1,716	4,457
American Assets Trust, L.P. | Limited Partner
OPERATING ACTIVITIES
Net income	[1]	339	3,312
American Assets Trust, L.P. | General Partner
OPERATING ACTIVITIES
Net income	[2]	$ 1,394	$ 12,172

[1] Consists of limited partnership interests held by third parties.

[2] Consists of general partnership interests held by American Assets Trust, Inc.

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Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2021	Dec. 31, 2020
Common stock, par value (in USD per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	490,000,000	490,000,000
Common stock, shares outstanding (shares)	60,472,286	60,476,292
Common stock, shares issued (in shares)	60,472,286	60,476,292
American Assets Trust, L.P.
Limited partners' capital, units outstanding (in shares)	16,181,537	16,181,537
Limited partners' capital, units issued (in shares)	16,181,537	16,181,537
General partners' capital, units issued (in shares)	60,472,286	60,476,292
General partners' capital, units outstanding (in shares)	60,472,286	60,476,292

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Mar. 31, 2021

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business and Organization

American Assets Trust, Inc. (which may be referred to in these financial statements as the “Company,” “we,” “us,” or “our”) is a Maryland corporation formed on July 16, 2010 that did not have any operating activity until the consummation of our initial public offering on January 19, 2011. The Company is the sole general partner of American Assets Trust, L.P., a Maryland limited partnership formed on July 16, 2010 (the “Operating Partnership”). The Company’s operations are carried on through our Operating Partnership and its subsidiaries, including our taxable real estate investment trust ("REIT") subsidiary ("TRS"). Since the formation of our Operating Partnership, the Company has controlled our Operating Partnership as its general partner and has consolidated its assets, liabilities and results of operations.

We are a full service, vertically integrated, and self-administered REIT with approximately 190 employees providing substantial in-house expertise in asset management, property management, property development, leasing, tenant improvement construction, acquisitions, repositioning, redevelopment and financing.

As of March 31, 2021, we owned or had a controlling interest in 28 office, retail, multifamily and mixed-use operating properties, the operations of which we consolidate. Additionally, as of March 31, 2021, we owned land at three of our properties that we classify as held for development and/or construction in progress. A summary of the properties owned by us is as follows:

Retail
Carmel Country Plaza	Gateway Marketplace	Alamo Quarry Market
Carmel Mountain Plaza	Del Monte Center	Hassalo on Eighth - Retail
South Bay Marketplace	Geary Marketplace
Lomas Santa Fe Plaza	The Shops at Kalakaua
Solana Beach Towne Centre	Waikele Center
Office
La Jolla Commons	One Beach Street
Torrey Reserve Campus	First & Main
Torrey Point	Lloyd Portfolio
Solana Crossing (formerly Solana Beach Corporate Centre)	City Center Bellevue
The Landmark at One Market
Multifamily
Loma Palisades	Hassalo on Eighth - Residential
Imperial Beach Gardens
Mariner's Point
Santa Fe Park RV Resort
Pacific Ridge Apartments
Mixed-Use
Waikiki Beach Walk Retail and Embassy Suites™ Hotel
Held for Development and/or Construction in Progress
La Jolla Commons – Land
Solana Crossing – Land
Lloyd Portfolio – Construction in Progress

Basis of Presentation

Our consolidated financial statements include the accounts of the Company, our Operating Partnership and our subsidiaries. The equity interests of other investors in our Operating Partnership are reflected as noncontrolling interests.

The Company follows the Financial Accounting Standards Board (the "FASB") guidance for determining whether an entity is a variable interest entity (“VIE”) and requires the performance of a qualitative rather than a quantitative analysis to determine the primary beneficiary of a VIE. Under this guidance, an entity would be required to consolidate a VIE if it has (i) the power to direct the activities that most significantly impact the entity’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could be significant to the VIE. American Assets Trust, Inc. has concluded that the Operating Partnership is a VIE, and because American Assets Trust, Inc. has both the power and the rights to control the Operating Partnership, American Assets Trust, Inc. is the primary beneficiary and is required to continue to consolidate the Operating Partnership.Substantially all of the assets and liabilities of the Company are related to the operating partnership VIE.

All intercompany transactions and balances are eliminated in consolidation.

The accompanying consolidated financial statements of the Company and the Operating Partnership have been prepared in accordance with the rules applicable to Form 10-Q and include all information and footnotes required for interim financial statement presentation, but do not include all disclosures required under accounting principles generally accepted in the United States (“GAAP”) for annual financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments, except as otherwise noted) considered necessary for a fair presentation have been included. These financial statements should be read in conjunction with the audited consolidated financial statements and notes therein included in the Company's and Operating Partnership's annual report on Form 10-K for the year ended December 31, 2020.

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that in certain circumstances affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and revenues and expenses. These estimates are prepared using our best judgment, after considering past, current and expected events and economic conditions. Actual results could differ from these estimates.

Any reference to the number of properties, number of units, square footage, employee numbers or percentages of beneficial ownership of our shares are unaudited and outside the scope of our independent registered public accounting firm’s review of our financial statements in accordance with the standards of the United States Public Company Accounting Oversight Board.

Consolidated Statements of Cash Flows—Supplemental Disclosures

The following table provides supplemental disclosures related to the Consolidated Statements of Cash Flows (in thousands): 

	Three Months Ended March 31,
	2021		2020
Supplemental cash flow information
Total interest costs incurred	$	14,564	$	13,736
Interest capitalized	$	559	$	264
Interest expense	$	14,005	$	13,472
Cash paid for interest, net of amounts capitalized	$	13,069	$	15,043
Cash paid for income taxes	$	71	$	51
Supplemental schedule of noncash investing and financing activities
Accounts payable and accrued liabilities for construction in progress	$	7,109	$	16,541
Accrued leasing commissions	$	631	$	2,083

 Significant Accounting Policies

We describe our significant accounting policies in Note 1 to the consolidated financial statements in Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2020. There have been no changes to our significant accounting policies during the three months ended March 31, 2021.

Segment Information

Segment information is prepared on the same basis that our chief operating decision maker 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.

Revenue Recognition and Accounts Receivable

Our leases with tenants are classified as operating leases. Substantially all such leases contain fixed rent escalations which occur at specified times during the term of the lease. Base rents are recognized on a straight-line basis from when the tenant controls the space through the term of the related lease, net of valuation adjustments, based on management's assessment of credit, collection and other business risks.

We make estimates of the collectability of our current accounts receivable and straight-line rents receivable which require significant judgment by management. The collectability of receivables is affected by numerous different factors including current economic conditions, including the impact of tenant bankruptcies, the status of collectability of current cash rents receivable, tenants' recent and historical financial and operating results, changes in our tenants' credit ratings, communications between our operating personnel and tenants, the extent of security deposits and letters of credit held with respect to tenants, and the ability of the tenant to perform under the terms of their lease agreement. The provision for doubtful accounts at March 31, 2021 and December 31, 2020 was approximately $12.2 million and $10.0 million, respectively.

Rent Concessions – COVID-19

During the first quarter of 2021, we provided lease concessions to certain tenants, primarily within the retail segment, as a result of the COVID-19 pandemic, in the form of rent deferrals and abatements. These lease concessions generally included an increase in our rights as a lessor. We assess each lease concession and determine whether it represents a lease modifications under Accounting Standards Codification Topic 842, Leases ("ASC 842"). As of March 31, 2021, we have entered into lease modifications that resulted in adjustments (including rent deferrals and other monetary lease concessions) due to the impact of the COVID-19 pandemic of approximately $1.2 million or 2% of the rent originally contracted for the three months ended March 31, 2021. For the first quarter of 2021, we collected approximately $0.7 million or 88% of the deferred rent repayments due during the period.

Recent Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2016-13, Financial Instruments - Credit Topics. The pronouncement requires companies to adopt a new approach to estimating credit losses on certain types of financial instruments, such as trade and other receivables and loans. The standard requires entities to estimate a lifetime expected credit loss for most financial instruments, including trade receivables. In November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses, which clarifies that receivables arising from operating leases are not within the scope of the pronouncement. We adopted the provisions of ASU No. 2016-13 effective January 1, 2020 and the adoption did not have a material impact on our consolidated financial statements as the majority of our receivables are derived from operating leases and are excluded from this standard.

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848), which provides companies with optional practical expedients to ease the accounting burden for contract modifications associated with transitioning away from LIBOR and other interbank offered rates that are expected to be discontinued as part of reference rate reform. For hedges, the

guidance generally allows changes to the reference rate and other critical terms without having to de-designate the hedging relationship, as well as allows the shortcut method to continue to be applied. For contract modifications, changes in the reference rate or other critical terms will be treated as a continuation of the prior contract. This guidance can be applied immediately, however, is generally only available through December 31, 2022. We are still evaluating the impact of reference rate reform and whether we will apply any of these practical expedients.

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ACQUIRED IN-PLACE LEASES AND ABOVE/BELOW MARKET LEASES

3 Months Ended

Mar. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

ACQUIRED IN-PLACE LEASES AND ABOVE/BELOW MARKET LEASES

ACQUIRED IN-PLACE LEASES AND ABOVE/BELOW MARKET LEASES

The following summarizes our acquired lease intangibles and leasing costs, which are included in other assets and other liabilities and deferred credits, as of March 31, 2021 and December 31, 2020 (in thousands): 

	March 31, 2021		December 31, 2020
In-place leases	$	60,447	$	60,965
Accumulated amortization	(35,324)		(34,758)
Above market leases	4,665		5,389
Accumulated amortization	(4,551)		(5,268)
Acquired lease intangible assets, net	$	25,237	$	26,328
Below market leases	$	56,666	$	56,677
Accumulated accretion	(35,993)		(35,219)
Acquired lease intangible liabilities, net	$	20,673	$	21,458

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FAIR VALUE OF FINANCIAL INSTRUMENTS

3 Months Ended

Mar. 31, 2021

Fair Value Disclosures [Abstract]

FAIR VALUE OF FINANCIAL INSTRUMENTS

FAIR VALUE OF FINANCIAL INSTRUMENTS

A fair value measurement is based on the assumptions that market participants would use in pricing an asset or liability. The hierarchy for inputs used in measuring fair value is as follows:

1.Level 1 Inputs—quoted prices in active markets for identical assets or liabilities

2.Level 2 Inputs—observable inputs other than quoted prices in active markets for identical assets and liabilities

3.Level 3 Inputs—unobservable inputs

The carrying values of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued liabilities are reasonable estimates of fair value, using Level 1 inputs, because of the short-term nature of these instruments. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

We measure the fair value of our deferred compensation liability, which is included in other liabilities and deferred credits on the consolidated balance sheet, on a recurring basis using Level 2 inputs. We measure the fair value of this liability based on prices provided by independent market participants that are based on observable inputs using market-based valuation techniques.

The fair value of the interest rate swap agreements are based on the estimated amounts we would receive or pay to terminate the contract at the reporting date and are determined using interest rate pricing models and interest rate related observable inputs. The changes in the fair value of the derivatives that are designated as cash flow hedges are being recorded in accumulated other comprehensive income (loss) and will be subsequently reclassified into earnings during the period in which the hedged forecasted transaction affects earnings.

We incorporate credit valuation adjustments to appropriately reflect both our own non-performance risk and the respective counterparty’s non-performance risk in the fair value measurements. In adjusting the fair value of our derivative contracts for the effect of non-performance risk, we considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees.

Although we have determined that the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by itself and its counterparties. However, as of March 31, 2021 we have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative position and have determined that the credit valuation adjustments are not significant to the overall valuation of our derivative. As a result, we have determined that our derivative valuation in its entirety is classified in Level 2 of the fair value hierarchy.

A summary of our financial liabilities that are measured at fair value on a recurring basis, by level within the fair value hierarchy is as follows (in thousands):

	March 31, 2021								December 31, 2020
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Deferred compensation liability	$	—	$	2,158	$	—	$	2,158	$	—	$	2,059	$	—	$	2,059
Interest rate swap liability	$	—	$	3,784	$	—	$	3,784	$	—	$	4,531	$	—	$	4,531

 The fair value of our secured notes payable and unsecured senior guaranteed notes are sensitive to fluctuations in interest rates. Discounted cash flow analysis using observable market interest rates (Level 2) is generally used to estimate the fair value of our secured notes payable, using rates ranging from 2.7% to 3.9%.

Considerable judgment is necessary to estimate the fair value of financial instruments. The estimates of fair value presented herein are not necessarily indicative of the amounts that could be realized upon disposition of the financial instruments. The carrying values of our revolving line of credit and term loan set forth below are deemed to be at fair value since the outstanding debt is directly tied to monthly LIBOR contracts. A summary of the carrying amount and fair value of our secured financial instruments, all of which are based on Level 2 inputs, is as follows (in thousands):  

	March 31, 2021				December 31, 2020
	Carrying Value		Fair Value		Carrying Value		Fair Value
Secured notes payable, net	$	110,934	$	113,364	$	110,923	$	114,074
Unsecured term loans, net	$	249,338	$	250,000	$	249,233	$	250,000
Unsecured senior guaranteed notes, net	$	797,645	$	827,895	$	947,444	$	1,017,378
Senior unsecured notes, net	$	489,907	$	493,790	$	—	$	—
Unsecured line of credit, net	$	—	$	—	$	99,151	$	100,000

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DERIVATIVE AND HEDGING ACTIVITIES

3 Months Ended

Mar. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE AND HEDGING ACTIVITIES

DERIVATIVE AND HEDGING ACTIVITIES

Our objectives in using interest rate derivatives are to add stability to interest expense and to manage our exposure to interest rate movements.  To accomplish these objectives, we primarily use interest rate swaps as part of our interest rate risk management strategy.  Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for us making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. 

The following is a summary of the terms of our outstanding interest rate swaps as of March 31, 2021 (dollars in thousands):

Swap Counterparty	Notional Amount		Effective Date	Maturity Date	Fair Value
U.S. Bank N.A.	$	100,000	3/1/2016	3/1/2023	$	(2,533)
Wells Fargo Bank, N.A.	$	50,000	5/2/2016	3/1/2023	$	(1,251)

The effective portion of changes in the fair value of the derivatives that are designated as cash flow hedges are being recorded in accumulated other comprehensive income and will be subsequently reclassified into earnings during the period in which the hedged forecasted transaction affects earnings for as long as hedged cash flows remain probable. During the next twelve months, we estimate that $1.1 million will be reclassified as a decrease to interest expense.

The valuation of these instruments is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of the derivative.  This analysis reflects the contractual terms of the derivative, including the period to maturity, counter party credit risk and uses observable market-based inputs, including interest rate curves, and implied volatilities.  The fair value of the interest rate swap is determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts).  The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves.

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OTHER ASSETS

3 Months Ended

Mar. 31, 2021

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

OTHER ASSETS

OTHER ASSETS

Other assets consist of the following (in thousands): 

	March 31, 2021		December 31, 2020
Leasing commissions, net of accumulated amortization of $36,529 and $35,167, respectively	$	37,385	$	38,173
Acquired above market leases, net	114		121
Acquired in-place leases, net	25,123		26,207
Lease incentives, net of accumulated amortization of $862 and $802, respectively	934		994
Other intangible assets, net of accumulated amortization of $1,277 and $1,213, respectively	2,486		2,565
Debt issuance costs, net of accumulated amortization of $1,324 and $0, respectively	746		—
Right-of-use lease asset, net	28,583		29,350
Prepaid expenses and other	7,787		8,702
Total other assets	$	103,158	$	106,112

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OTHER LIABILITIES AND DEFERRED CREDITS

3 Months Ended

Mar. 31, 2021

Other Liabilities Disclosure [Abstract]

OTHER LIABILITIES AND DEFERRED CREDITS

OTHER LIABILITIES AND DEFERRED CREDITS

Other liabilities and deferred credits consist of the following (in thousands):

	March 31, 2021		December 31, 2020
Acquired below market leases, net	$	20,673	$	21,458
Prepaid rent and deferred revenue	14,371		14,518
Interest rate swap liability	3,784		4,531
Deferred rent expense and lease intangible	13		16
Deferred compensation	2,158		2,059
Deferred tax liability	570		570
Straight-line rent liability	17,156		18,049
Lease liability	29,471		30,060
Other liabilities	32		39
Total other liabilities and deferred credits, net	$	88,228	$	91,300

Straight-line rent liability relates to leases which have rental payments that decrease over time or one-time upfront payments for which the rental revenue is deferred and recognized on a straight-line basis.

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DEBT

3 Months Ended

Mar. 31, 2021

Debt Disclosure [Abstract]

DEBT

DEBT

Debt of American Assets Trust, Inc.

American Assets Trust, Inc. does not hold any indebtedness. All debt is held directly or indirectly by the Operating Partnership; however, American Assets Trust, Inc. has guaranteed the Operating Partnership's obligations under the (i) amended and restated credit facility, (ii) term loans, (iii) senior guaranteed notes, and (iv) senior unsecured notes. Additionally, American Assets Trust, Inc. has provided a carve-out guarantee on the property-level mortgage debt at City Center Bellevue.

Debt of American Assets Trust, L.P.

Secured notes payable

The following is a summary of our total secured notes payable outstanding as of March 31, 2021 and December 31, 2020 (in thousands):

	Principal Balance as of				Stated Interest Rate		Stated Maturity Date
Description of Debt	March 31, 2021		December 31, 2020		as of March 31, 2021
City Center Bellevue (1)	111,000		111,000		3.98	%	November 1, 2022
	111,000		111,000
Debt issuance costs, net of accumulated amortization of $355 and $345, respectively	(66)		(77)
Total Secured Notes Payable Outstanding	$	110,934	$	110,923

(1)Interest only.

Certain loans require us to comply with various financial covenants. As of March 31, 2021, the Operating Partnership was in compliance with these financial covenants.

Unsecured notes payable

The following is a summary of the Operating Partnership's total unsecured notes payable outstanding as of March 31, 2021 and December 31, 2020 (in thousands):

Description of Debt	Principal Balance as of				Stated Interest Rate			Stated Maturity Date
	March 31, 2021		December 31, 2020		as of March 31, 2021
Term Loan A	$	100,000	$	100,000	Variable		(1)	January 9, 2022
Senior Guaranteed Notes, Series A (2)	—		150,000		4.04	%	(3)	October 31, 2021
Term Loan B	100,000		100,000		Variable		(4)	March 1, 2023
Term Loan C	50,000		50,000		Variable		(5)	March 1, 2023
Senior Guaranteed Notes, Series F	100,000		100,000		3.78	%	(6)	July 19, 2024
Senior Guaranteed Notes, Series B	100,000		100,000		4.45	%		February 2, 2025
Senior Guaranteed Notes, Series C	100,000		100,000		4.50	%		April 1, 2025
Senior Guaranteed Notes, Series D	250,000		250,000		4.29	%	(7)	March 1, 2027
Senior Guaranteed Notes, Series E	100,000		100,000		4.24	%	(8)	May 23, 2029
Senior Guaranteed Notes, Series G	150,000		150,000		3.91	%	(9)	July 30, 2030
3.375% Senior Unsecured Notes	500,000		—		3.38	%		February 1, 2031
	1,550,000		1,200,000
Debt discount and issuance costs, net of accumulated amortization of $9,463 and $8,856, respectively	(13,110)		(3,323)
Total Unsecured Notes Payable	$	1,536,890	$	1,196,677

(1)The Operating Partnership has entered into an interest rate swap agreement that is intended to fix the interest rate associated with Term Loan A at approximately 4.13% through the interest rate swap maturity date of January 9, 2021, subject to adjustments based on our consolidated leverage ratio. Subsequent to January 9, 2021, the interest rate associated with Term Loan A will be variable as described below.

(2)Notes prepaid in full, with make-whole penalty thereon of approximately $3.9 million, on January 26, 2021.

(3)The Operating Partnership entered into a one-month forward-starting seven years swap contract on August 19, 2014, which was settled on September 19, 2014 at a gain of approximately $1.6 million. The forward-starting seven-year swap contract was deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 3.88% per annum. On January 26, 2021, we prepaid the entirety of the Senior Guaranteed Notes, Seres A with make-whole premium thereon.

(4)The Operating Partnership has entered into an interest rate swap agreement that is intended to fix the interest rate associated with Term Loan B at approximately 3.15% through its maturity date, subject to adjustments based on our consolidated leverage ratio. Effective March 1, 2018, the effective interest rate associated with Term Loan B is approximately 2.75%, subject to adjustments based on our consolidated leverage ratio.

(5)The Operating Partnership has entered into an interest rate swap agreement that is intended to fix the interest rate associated with Term Loan C at approximately 3.14% through its maturity date, subject to adjustments based on our consolidated leverage ratio. Effective March 1, 2018, the effective interest rate associated with Term Loan C is approximately 2.74%, subject to adjustments based on our consolidated leverage ratio.

(6)The Operating Partnership entered into a treasury lock contract on May 31, 2017, which was settled on June 23, 2017 at a loss of approximately $0.5 million. The treasury lock contract was deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 3.85% per annum.

(7)The Operating Partnership entered into forward-starting interest rate swap contracts on March 29, 2016 and April 7, 2016, which were settled on January 18, 2017 at a gain of approximately $10.4 million. Each of the forward-starting interest swap rate contracts were deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 3.87% per annum.

(8)The Operating Partnership entered into a treasury lock contract on April 25, 2017, which was settled on May 11, 2017 at a gain of approximately $0.7 million. The treasury lock contract was deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 4.18% per annum.

(9)The Operating Partnership entered into a treasury lock contract on June 20, 2019, which was settled on July 17, 2019 at a gain of approximately $0.5 million. The treasury lock contract was deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 3.88% per annum.

On January 26, 2021, the Operating Partnership issued $500 million of senior unsecured notes (the "3.375% Senior Notes") that mature February 1, 2031 and bear interest at 3.375% per annum. The 3.375% Senior Notes were priced at 98.935% of the principal amount with a yield to maturity of 3.502%. The net proceeds of the 3.375% Senior Notes, after the issuance discount, underwriting fees, and other costs were approximately $489.7 million, which were primarily used to (i) prepay our $150 million Senior Guaranteed Notes, Series A, with a make-whole payment (as defined in the Note Purchase Agreement for the Series A Notes) thereon of approximately $3.9 million, on January 26, 2021, (ii) repay our $100 million then outstanding

balance under our Revolver Loan on January 26, 2021, (iii) fund the development of the La Jolla Commons III office building and (iv) for general corporate purposes.

Certain unsecured loans and notes require us to comply with various financial covenants. As of March 31, 2021, the Operating Partnership was in compliance with these financial covenants.

Amended Term Loan Agreement

On January 9, 2018, we entered into the Third Amendment to the Term Loan Agreement (as so amended, the "Term Loan Agreement"), which maintains the seven years $150 million unsecured term loan (referred to herein as Term Loan B and Term Loan C) to the Operating Partnership that matures on March 1, 2023 (the “$150mm Term Loan”). Effective as of March 1, 2018, borrowings under the Term Loan Agreement with respect to the $150mm Term Loan bear interest at floating rates equal to, at the Operating Partnership’s option, either (1) LIBOR, plus a spread which ranges from 1.20% to 1.70% based on the Operating Partnership’s consolidated leverage ratio, or (2) a base rate equal to the highest of (a) 0%, (b) the prime rate, (c) the federal funds rate plus 50 bps or (d) the Eurodollar rate plus 100 bps, in each case plus a spread which ranges from 0.70% to 1.35% based on the Operating Partnership’s consolidated leverage ratio. Additionally, the Operating Partnership may elect for borrowings to bear interest based on a ratings-based pricing grid as per the Operating Partnership’s then-applicable investment grade debt ratings under the terms set forth in the Term Loan Agreement.

Second Amended and Restated Credit Facility

On January 9, 2018, we entered into a second amended and restated credit agreement (the "Second Amended and Restated Credit Facility"). The Second Amended and Restated Credit Facility provides for aggregate, unsecured borrowing of $450 million, consisting of a revolving line of credit of $350 million (the "Revolver Loan") and a term loan of $100 million (the "Term Loan A"). The Second Amended and Restated Credit Facility has an accordion feature that may allow us to increase the availability thereunder up to an additional $250 million, subject to meeting specified requirements and obtaining additional commitments from lenders. At March 31, 2021, there were no amounts outstanding under the Revolver Loan and we had incurred approximately $0.7 million of debt issuance costs, net, which are recorded in other assets, net on the consolidated balance sheets.

Borrowings under the Second Amended and Restated Credit Agreement initially bear interest at floating rates equal to, at our option, either (1) LIBOR, plus a spread which ranges from (a) 1.05% to 1.50% (with respect to the Revolver Loan) and (b) 1.30% to 1.90% (with respect to Term Loan A), in each case based on our consolidated leverage ratio, or (2) a base rate equal to the highest of (a) the prime rate, (b) the federal funds rate plus 50 bps or (c) LIBOR plus 100 bps, plus a spread which ranges from (i) 0.10% to 0.50% (with respect to the Revolver Loan) and (ii) 0.30% to 0.90% (with respect to Term Loan A), in each case based on our consolidated leverage ratio. For the three months ended March 31, 2021, the weighted average interest rate on the Revolver Loan was 1.21%.

The Revolver Loan initially matures on January 9, 2022, subject to our option to extend the Revolver Loan up to two times, with each such extension for a six months period. The extension options are exercisable by us subject to the satisfaction of certain conditions.

On January 9, 2019, we entered into the first amendment (“First Amendment”) to the Second Amended and Restated Credit Facility, which extended the maturity date of Term Loan A to January 9, 2021, subject to three, one year extension options. In October 2020, we exercised an option to extend the maturity date of Term Loan A to January 9, 2022, subject to certain conditions. Additionally, in connection with the First Amendment, borrowings under the Second Amended and Restated Credit Facility with respect to Term Loan A bear interest at floating rates equal to, at our option, either (1) LIBOR, plus a spread which ranges from 1.20% to 1.70% based on our consolidated total leverage ratio, or (2) a base rate equal to the highest of (a) the prime rate, (b) the federal funds rate plus 50 bps or (c) the Eurodollar rate plus 100 bps, in each case plus a spread which ranges from 0.20% to 0.70% based on our consolidated total leverage ratio. The foregoing rates are intended to be more favorable than previously contained in the Second Amended and Restated Credit Facility (prior to entry into the First Amendment) with respect to Term Loan A.

Additionally, the Second Amended and Restated Credit Facility includes a number of customary financial covenants, including:

•A maximum leverage ratio (defined as total indebtedness net of certain cash and cash equivalents to total asset value) of 60%,

•A maximum secured leverage ratio (defined as total secured debt to secured total asset value) of 40%,

•A minimum fixed charge coverage ratio (defined as consolidated earnings before interest, taxes, depreciation and amortization to consolidated fixed charges) of 1.50x,

•A minimum unsecured interest coverage ratio of 1.75x,

•A maximum unsecured leverage ratio of 60%, and

•Recourse indebtedness at any time cannot exceed 15% of total asset value.

The Second Amended and Restated Credit Facility provides that our annual distributions may not exceed the greater of (1) 95% of our funds from operation ("FFO") or (2) the amount required for us to (a) qualify and maintain our REIT status and (b) avoid the payment of federal or state income or excise tax. If certain events of default exist or would result from a distribution, we may be precluded from making distributions other than those necessary to qualify and maintain our status as a REIT.

As of March 31, 2021, the Operating Partnership was in compliance with the financial covenants in the Second Amended and Restated Credit Facility.

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PARTNERS' CAPITAL OF AMERICAN ASSETS TRUST, L.P.

3 Months Ended

Mar. 31, 2021

Equity [Abstract]

PARTNERS' CAPITAL OF AMERICAN ASSETS TRUST, L.P.

PARTNERS' CAPITAL OF AMERICAN ASSETS TRUST, L.P.

Noncontrolling interests in our Operating Partnership are interests in the Operating Partnership that are not owned by us. Noncontrolling interests consisted of 16,181,537 common units (the “noncontrolling common units”), and represented approximately 21.3% of the ownership interests in our Operating Partnership at March 31, 2021. Common units and shares of our common stock have essentially the same economic characteristics in that common units and shares of our common stock share equally in the total net income or loss distributions of our Operating Partnership. Investors who own common units have the right to cause our Operating Partnership to redeem any or all of their common units for cash equal to the then-current market value of one share of our common stock, or, at our election, shares of our common stock on a one-for-one basis.

During the three months ended March 31, 2021, no common units were converted into shares of our common stock.

Earnings Per Unit of the Operating Partnership

Basic earnings per unit (“EPU”) of the Operating Partnership is computed by dividing income applicable to unitholders by the weighted average Operating Partnership units outstanding, as adjusted for the effect of participating securities. Operating Partnership units granted in equity-based payment transactions that have non-forfeitable dividend equivalent rights are considered participating securities prior to vesting. The impact of unvested Operating Partnership unit awards on EPU has been calculated using the two-class method whereby earnings are allocated to the unvested Operating Partnership unit awards based on distributions and the unvested Operating Partnership units’ participation rights in undistributed earnings.

The calculation of diluted EPU for the three months ended March 31, 2021 and 2020 does not include the weighted average of 489,775 and 345,153 unvested Operating Partnership units, respectively, as these equity securities are either considered contingently issuable or the effect of including these equity securities was anti-dilutive to income from continuing operations and net income attributable to the unitholders.

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EQUITY OF AMERICAN ASSETS TRUST, INC.

3 Months Ended

Mar. 31, 2021

Equity [Abstract]

EQUITY OF AMERICAN ASSETS TRUST, INC.

EQUITY OF AMERICAN ASSETS TRUST, INC.

Stockholders' Equity

On May 27, 2015, we entered into an at-the-market ("ATM") equity program with five sales agents in which we may, from time to time, offer and sell shares of our common stock having an aggregate offering price of up to $250.0 million. On March 2, 2018, we amended certain of these equity programs, terminated one such program and entered into a new equity program with one new sales agent. The sales of shares of our common stock made through the ATM equity program, as amended, are made in "at-the-market" offerings as defined in Rule 415 of the Securities Act of 1933, as amended. During the three months ended March 31, 2021, no shares of common stock were sold through the ATM equity program.

We intend to use the net proceeds from the ATM equity program to fund our development or redevelopment activities, repay amounts outstanding from time to time under our revolving line of credit or other debt financing obligations, fund potential acquisition opportunities and/or for general corporate purposes. As of March 31, 2021, we had the capacity to issue up to an additional $132.6 million in shares of our common stock under our ATM equity program upon filing an updated prospectus supplement with the SEC. Actual future sales will depend on a variety of factors including, but not limited to, market conditions, the trading price of our common stock and our capital needs. We have no obligation to sell the remaining shares available for sale under the ATM equity program.

Dividends

The following table lists the dividends declared and paid on our shares of common stock and noncontrolling common units during the three months ended March 31, 2021: 

Period	Amount per Share/Unit		Period Covered	Dividend Paid Date
First Quarter 2021	$	0.28	January 1, 2021 to March 31, 2021	March 25, 2021

Taxability of Dividends

Earnings and profits, which determine the taxability of distributions to stockholders and holders of common units, may differ from income reported for financial reporting purposes due to the differences for federal income tax purposes in the treatment of revenue recognition and compensation expense and in the basis of depreciable assets and estimated useful lives used to compute depreciation.

Stock-Based Compensation

We follow the FASB guidance related to stock-based compensation which establishes financial accounting and reporting standards for stock-based employee compensation plans, including all arrangements by which employees receive shares of stock or other equity instruments of the employer.  The guidance also defines a fair value-based method of accounting for an employee stock award or similar equity instrument.

The following table summarizes the activity of restricted stock awards during the three months ended March 31, 2021:

	Units	Weighted Average Grant Date Fair Value
Nonvested at January 1, 2021	491,957	$23.53
Granted	—	—
Vested	—	—
Forfeited	(4,006)	23.24
Nonvested at March 31, 2021	487,951	$23.54

We recognize noncash compensation expense ratably over the vesting period, and accordingly, we recognized $1.5 million and $1.3 million in noncash compensation expense for the three months ended March 31, 2021 and 2020, respectively. Unrecognized compensation expense was $6.9 million at March 31, 2021.

Earnings Per Share

We have calculated earnings per share (“EPS”) under the two-class method. The two-class method is an earnings allocation methodology whereby EPS for each class of common stock and participating security is calculated according to dividends declared and participation rights in undistributed earnings. The weighted average unvested shares outstanding, which are considered participating securities, were 489,775 and 345,153 for the three months ended March 31, 2021 and 2020, respectively. Therefore, we have allocated our earnings for basic and diluted EPS between common shares and unvested shares as these unvested shares have nonforfeitable dividend equivalent rights.

Diluted EPS is calculated by dividing the net income applicable to common stockholders for the period by the weighted average number of common and dilutive instruments outstanding during the period using the treasury stock method. For the three months ended March 31, 2021 and 2020, diluted shares exclude incentive restricted stock as these awards are considered contingently issuable. Additionally, the unvested restricted stock awards subject to time vesting are anti-dilutive for all periods presented, and accordingly, have been excluded from the weighted average common shares used to compute diluted EPS.

The computation of basic and diluted EPS is presented below (dollars in thousands, except share and per share amounts): 

	Three Months Ended March 31,
	2021		2020
NUMERATOR
Net income	$	1,733	$	15,484
Less: Net income attributable to restricted shares	(137)		(104)
Less: Income from operations attributable to unitholders in the Operating Partnership	(339)		(3,312)
Net income attributable to common stockholders—basic	$	1,257	$	12,068
Income from operations attributable to American Assets Trust, Inc. common stockholders—basic	$	1,257	$	12,068
Plus: Income from operations attributable to unitholders in the Operating Partnership	339		3,312
Net income attributable to common stockholders—diluted	$	1,596	$	15,380
DENOMINATOR
Weighted average common shares outstanding—basic	59,984,335		59,723,072
Effect of dilutive securities—conversion of Operating Partnership units	16,181,537		16,390,548
Weighted average common shares outstanding—diluted	76,165,872		76,113,620
Earnings per common share, basic	$	0.02	$	0.20
Earnings per common share, diluted	$	0.02	$	0.20

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INCOME TAXES

3 Months Ended

Mar. 31, 2021

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXESWe elected to be taxed as a REIT and operate in a manner that allows us to qualify as a REIT for federal income tax purposes commencing with our initial taxable year. As a REIT, we are generally not subject to corporate level income tax on the earnings distributed currently to our stockholders that we derive from our REIT qualifying activities. Taxable income from non-REIT activities managed through our TRS is subject to federal and state income taxes.

We lease our hotel property to a wholly owned TRS that is subject to federal and state income taxes. We account for income taxes using the asset and liability method, under which deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between GAAP carrying amounts and their respective tax bases. Additionally, we classify certain state taxes as income taxes for financial reporting purposes in accordance with ASC Topic 740, Income Taxes.

A deferred tax liability is included in the other liabilities and deferred credits, net on our consolidated balance sheets of $0.6 million and $0.6 million as of March 31, 2021 and December 31, 2020, respectively, in relation to real estate asset basis differences of property subject to state taxes based on income and certain prepaid expenses of our TRS.

Income tax expense is recorded in other (expense) income, net on our consolidated statements of comprehensive income. For the three months ended March 31, 2021, we recorded income tax expense of $0.1 million. For the three months ended March 31, 2020, we recorded income tax expense of $0.2 million.

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COMMITMENTS AND CONTINGENCIES

3 Months Ended

Mar. 31, 2021

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

Legal

We are sometimes involved in various disputes, lawsuits, warranty claims, environmental, and other matters arising in the ordinary course of business. Management makes assumptions and estimates concerning the likelihood and amount of any potential loss relating to these matters.

We are currently a party to various legal proceedings. We accrue a liability for litigation if an unfavorable outcome is probable and the amount of loss can be reasonably estimated. If an unfavorable outcome is probable and a reasonable estimate of the loss is a range, we accrue the best estimate within the range; however, if no amount within the range is a better estimate than any other amount, the minimum within the range is accrued. Legal fees related to litigation are expensed as incurred. We do not believe that the ultimate outcome of these matters, either individually or in the aggregate, could have a material adverse effect on our financial position or overall trends in results of operations; however, litigation is subject to inherent uncertainties. Also, under our leases, tenants are typically obligated to indemnify us from and against all liabilities, costs and expenses imposed upon or asserted against us as owner of the properties due to certain matters relating to the operation of the properties by the tenant.

Commitments

See Footnote 12 for description of our leases, as a lessee.

We have management agreements with Outrigger Hotels & Resorts or an affiliate thereof (“Outrigger”) pursuant to which Outrigger manages each of the retail and hotel portions of the Waikiki Beach Walk property. Under the management agreement with Outrigger relating to the retail portion of Waikiki Beach Walk (the “retail management agreement”), we pay Outrigger a monthly management fee of 3.0% of net revenues from the retail portion of Waikiki Beach Walk. Pursuant to the terms of the retail management agreement, if the agreement is terminated in certain instances, including our election not to repair damage or destruction at the property, a condemnation or our failure to make required working capital infusions, we would be obligated to pay Outrigger a termination fee equal to the sum of the management fees paid for the two months immediately preceding the termination date. The retail management agreement may not be terminated by us or by Outrigger without cause. Under our management agreement with Outrigger relating to the hotel portion of Waikiki Beach Walk (the “hotel management agreement”), we pay Outrigger a monthly management fee of 6.0% of the hotel's gross operating profit, as well as 3.0% of the hotel's gross revenues; provided that the aggregate management fee payable to Outrigger for any year shall not exceed 3.5% of the hotel's gross revenues for such fiscal year. Pursuant to the terms of the hotel management agreement, if the agreement is terminated in certain instances, including upon a transfer by us of the hotel or upon a default by us under the hotel management agreement, we would be required to pay a cancellation fee calculated by multiplying (1) the management fees for the previous 12 months by (2) (a) eight, if the agreement is terminated in the first 11 years of its term, or (b) four, three, two or one, if the agreement is terminated in the twelfth, thirteenth, fourteenth or fifteenth year, respectively, of its term. The hotel management agreement may not be terminated by us or by Outrigger without cause.

A wholly owned subsidiary of our Operating Partnership, WBW Hotel Lessee LLC, entered into a franchise license agreement with Embassy Suites Franchise LLC, the franchisor of the brand “Embassy Suites™,” to obtain the non-exclusive right to operate the hotel under the Embassy SuitesTM brand for 20 years. The franchise license agreement provides that WBW Hotel Lessee LLC must comply with certain management, operational, record keeping, accounting, reporting and marketing standards and procedures. In connection with this agreement, we are also subject to the terms of a product improvement plan pursuant to which we expect to undertake certain actions to ensure that our hotel's infrastructure is maintained in compliance with the franchisor's brand standards. In addition, we must pay to Embassy Suites Franchise LLC a monthly franchise royalty fee equal to 4.0% of the hotel's gross room revenue through December 2021 and 5.0% of the hotel's gross room revenue thereafter, as well as a monthly program fee equal to 4.0% of the hotel's gross room revenue. If the franchise license is terminated due to our failure to make required improvements or to otherwise comply with its terms, we may be liable to the franchisor for a termination payment, which could be as high as $4.9 million based on operating performance through March 31, 2021.

Our Del Monte Center property has ongoing environmental remediation related to ground water contamination. The environmental issue existed at purchase and remains in remediation. The final stages of the remediation will include routine, long term ground monitoring by the appropriate regulatory agency over the next five years to seven years. The work performed is financed through an escrow account funded by the seller upon purchase of the Del Monte Center. We believe the funds in the escrow account are sufficient for the remaining work to be performed. However, if further work is required costing more than the remaining escrow funds, we could be required to pay such overage, although we may have a contractual claim for such costs against the prior owner or our environmental remediation consultant.

Concentrations of Credit Risk

Our properties are located in Southern California, Northern California, Hawaii, Oregon, Texas, and Washington. The ability of the tenants to honor the terms of their respective leases is dependent upon the economic, regulatory, social, and health factors affecting the markets in which the tenants operate including, without limitation, the impact the COVID-19 pandemic has had on our tenants. Fifteen of our consolidated properties are located in Southern California, which exposes us to greater economic risks than if we owned a more geographically diverse portfolio. Tenants in the retail industry accounted for 25.9% of total revenues for the three months ended March 31, 2021. This makes us susceptible to demand for retail rental space and subject to the risks associated with an investment in real estate with a concentration of tenants in the retail industry. Furthermore, tenants in the office industry accounted for 52.9% of total revenues for the three months ended March 31, 2021. This makes us susceptible to demand for office rental space and subject to the risks associated with an investment in real estate with a concentration of tenants in the office industry. For the three months ended March 31, 2021 and 2020, no tenant accounted for more than 10% of our total rental revenue.

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LEASES

3 Months Ended

Mar. 31, 2021

Leases [Abstract]

LEASES

LEASES

Lessor Operating Leases

We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases.

Our leases with office, retail, mixed-use and residential tenants are classified as operating leases. Leases at our office and retail properties and the retail portion of our mixed-use property generally range from three years to ten years (certain leases with anchor tenants may be longer), and in addition to minimum rents, usually provide for cost recoveries for the tenant’s share of certain operating costs. Our leases may also include variable lease payments in the form of percentage rents based on the tenant’s level of sales achieved in excess of a breakpoint threshold. Leases on apartments generally range from 7 to 15 months, with a majority having 12-month lease terms. Rooms at the hotel portion of our mixed-use property are rented on a nightly basis.

Leases at our office and retail properties and the retail portion of our mixed-use property may contain lease extension options, at our lessee's discretion. The extension options are generally for 3 to 10 years and contain primarily rent at fixed rates or the prevailing market rent. The extension options are generally exercisable 6 to 12 months prior to the expiration of the lease and require the lessee to not be in default of the lease terms.

We attempt to maximize the amount we expect to derive from the underlying real estate property following the end of a lease, to the extent it is not extended.  We maintain a proactive leasing and capital improvement program that, combined with the quality and locations of our properties, has made our properties attractive to tenants. However, the residual value of a real estate property is still subject to various market-specific, asset-specific, and tenant-specific risks and characteristics. 

As of March 31, 2021, minimum future rentals from noncancelable operating leases, before any reserve for uncollectible amounts and assuming no early lease terminations, at our office and retail properties and the retail portion of our mixed-use property are as follows (in thousands):

Year Ending December 31,
2021 (nine months ending December 31, 2021)	$	162,655
2022	215,710
2023	199,077
2024	168,525
2025	147,434
Thereafter	443,310
Total	$	1,336,711

The above future minimum rentals exclude residential leases, which typically have a term of 12 months or less, and exclude the hotel, as rooms are rented on a nightly basis.

Lessee Operating Leases

We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases.

At the Landmark at One Market, we lease, as lessee, a building adjacent to the Landmark at One Market under an operating lease effective through June 30, 2026, which we have the option to extend until 2031 by way of the remaining five years extension option (the "Annex Lease"). The lease payments under the extension option provided for under the Annex Lease will be equal to the fair rental value at the time the extension option is exercised. The extension option is included in the calculation of the right-of-use asset and lease liability as we are reasonably certain of exercising the extension option.

At Waikiki Beach Walk, we lease a portion of the building of which the tenant Quiksilver is currently in possession, under an operating lease effective through December 31, 2021.

Our lease agreements do not contain any residual value guarantees or material restrictive covenants. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement in determining the present value of lease payments.

Current annual payments under the operating leases are as follows, as of March 31, 2021 (in thousands): 

Year Ending December 31,
2021 (nine months ending December 31, 2021)	$	2,350
2022	3,232
2023	3,328
2024	3,428
2025	3,531
Thereafter	19,710
Total lease payments	$	35,579
Imputed interest	$	(6,108)
Present value of lease liability	$	29,471

Lease costs under the operating leases are as follows (in thousands):    

	Three Months Ended March 31,
	2021			2020
Operating lease cost	$	1,132		$	844
Variable lease cost	—			—
Sublease income	(1,194)			(868)
Total lease (income) cost	$	(62)		$	(24)
Weighted-average remaining lease term - operating leases (in years)	10.0
Weighted-average discount rate - operating leases	3.21		%

Supplemental cash flow information and non-cash activity related to our operating leases are as follow (in thousands):

	Three Months Ended March 31,
	2021		2020
Operating cash flow information:
Cash paid for amounts included in the measurement of lease liabilities	$	865	$	846
Non-cash activity:
Right-of-use assets obtained in exchange for operating lease obligations	$	—	$	22,188

Subleases

At the Landmark at One Market, we (as sublandlord) sublease the Annex Lease building under operating leases effective through December 31, 2029. The subleases contain extension options, subject to our ability to extend the Annex Lease, that can extend the subleases through December 31, 2039 at the fair rental value at the time the extension option is exercised.

At Waikiki Beach Walk, we (as sublandlord) sublease a portion of the building to the tenant Quiksilver under an operating lease effective through December 31, 2021.

LEASES

LEASES

Lessor Operating Leases

We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases.

Our leases with office, retail, mixed-use and residential tenants are classified as operating leases. Leases at our office and retail properties and the retail portion of our mixed-use property generally range from three years to ten years (certain leases with anchor tenants may be longer), and in addition to minimum rents, usually provide for cost recoveries for the tenant’s share of certain operating costs. Our leases may also include variable lease payments in the form of percentage rents based on the tenant’s level of sales achieved in excess of a breakpoint threshold. Leases on apartments generally range from 7 to 15 months, with a majority having 12-month lease terms. Rooms at the hotel portion of our mixed-use property are rented on a nightly basis.

Leases at our office and retail properties and the retail portion of our mixed-use property may contain lease extension options, at our lessee's discretion. The extension options are generally for 3 to 10 years and contain primarily rent at fixed rates or the prevailing market rent. The extension options are generally exercisable 6 to 12 months prior to the expiration of the lease and require the lessee to not be in default of the lease terms.

We attempt to maximize the amount we expect to derive from the underlying real estate property following the end of a lease, to the extent it is not extended.  We maintain a proactive leasing and capital improvement program that, combined with the quality and locations of our properties, has made our properties attractive to tenants. However, the residual value of a real estate property is still subject to various market-specific, asset-specific, and tenant-specific risks and characteristics. 

As of March 31, 2021, minimum future rentals from noncancelable operating leases, before any reserve for uncollectible amounts and assuming no early lease terminations, at our office and retail properties and the retail portion of our mixed-use property are as follows (in thousands):

Year Ending December 31,
2021 (nine months ending December 31, 2021)	$	162,655
2022	215,710
2023	199,077
2024	168,525
2025	147,434
Thereafter	443,310
Total	$	1,336,711

The above future minimum rentals exclude residential leases, which typically have a term of 12 months or less, and exclude the hotel, as rooms are rented on a nightly basis.

Lessee Operating Leases

We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases.

At the Landmark at One Market, we lease, as lessee, a building adjacent to the Landmark at One Market under an operating lease effective through June 30, 2026, which we have the option to extend until 2031 by way of the remaining five years extension option (the "Annex Lease"). The lease payments under the extension option provided for under the Annex Lease will be equal to the fair rental value at the time the extension option is exercised. The extension option is included in the calculation of the right-of-use asset and lease liability as we are reasonably certain of exercising the extension option.

At Waikiki Beach Walk, we lease a portion of the building of which the tenant Quiksilver is currently in possession, under an operating lease effective through December 31, 2021.

Our lease agreements do not contain any residual value guarantees or material restrictive covenants. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement in determining the present value of lease payments.

Current annual payments under the operating leases are as follows, as of March 31, 2021 (in thousands): 

Year Ending December 31,
2021 (nine months ending December 31, 2021)	$	2,350
2022	3,232
2023	3,328
2024	3,428
2025	3,531
Thereafter	19,710
Total lease payments	$	35,579
Imputed interest	$	(6,108)
Present value of lease liability	$	29,471

Lease costs under the operating leases are as follows (in thousands):    

	Three Months Ended March 31,
	2021			2020
Operating lease cost	$	1,132		$	844
Variable lease cost	—			—
Sublease income	(1,194)			(868)
Total lease (income) cost	$	(62)		$	(24)
Weighted-average remaining lease term - operating leases (in years)	10.0
Weighted-average discount rate - operating leases	3.21		%

Supplemental cash flow information and non-cash activity related to our operating leases are as follow (in thousands):

	Three Months Ended March 31,
	2021		2020
Operating cash flow information:
Cash paid for amounts included in the measurement of lease liabilities	$	865	$	846
Non-cash activity:
Right-of-use assets obtained in exchange for operating lease obligations	$	—	$	22,188

Subleases

At the Landmark at One Market, we (as sublandlord) sublease the Annex Lease building under operating leases effective through December 31, 2029. The subleases contain extension options, subject to our ability to extend the Annex Lease, that can extend the subleases through December 31, 2039 at the fair rental value at the time the extension option is exercised.

At Waikiki Beach Walk, we (as sublandlord) sublease a portion of the building to the tenant Quiksilver under an operating lease effective through December 31, 2021.

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COMPONENTS OF RENTAL INCOME AND EXPENSE

3 Months Ended

Mar. 31, 2021

Revenue Recognition and Deferred Revenue [Abstract]

COMPONENTS OF RENTAL INCOME AND EXPENSE

COMPONENTS OF RENTAL INCOME AND EXPENSE

The principal components of rental income are as follows (in thousands): 

	Three Months Ended March 31,
	2021		2020
Lease rental income
Office	$	43,362	$	42,213
Retail	20,853		24,955
Multifamily	11,752		11,967
Mixed-use	795		3,932
Percentage rent	526		301
Hotel revenue	3,271		8,125
Other	571		577
Total rental income	$	81,130	$	92,070

Lease rental income include $5.5 million and $2.8 million for the three months ended March 31, 2021 and 2020, respectively, to recognize lease rental income on a straight-line basis. In addition, net amortization of above and below market leases included in lease rental income were $0.8 million and $0.9 million for the three months ended March 31, 2021 and 2020, respectively.

The principal components of rental expenses are as follows (in thousands): 

	Three Months Ended March 31,
	2021		2020
Rental operating	$	9,496	$	9,882
Hotel operating	2,724		5,747
Repairs and maintenance	3,742		4,297
Marketing	393		507
Rent	1,152		853
Hawaii excise tax	532		865
Management fees	207		417
Total rental expenses	$	18,246	$	22,568

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OTHER (EXPENSE) INCOME, NET

3 Months Ended

Mar. 31, 2021

Other Income and Expenses [Abstract]

OTHER (EXPENSE) INCOME, NET

OTHER (EXPENSE) INCOME, NET

The principal components of other expense, net, are as follows (in thousands):

	Three Months Ended March 31,
	2021		2020
Interest and investment income	$	74	$	312
Income tax expense	(127)		(206)
Other non-operating income	—		2
Total other (expense) income, net	$	(53)	$	108

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RELATED PARTY TRANSACTIONS

3 Months Ended

Mar. 31, 2021

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

During the first quarter of 2019, we terminated a lease agreement with American Assets, Inc. ("AAI"), an entity owned and controlled by Ernest Rady, our CEO, President, and Chairman of Board, and entered into a new lease agreement with AAI for office space at Torrey Reserve Campus. Rents commenced on March 1, 2019 for an initial lease term of three years at an average annual rental rate of $0.2 million. Rental revenue recognized on the AAI leases of $0.1 million and $0.0 million for the three months ended March 31, 2021 and 2020, respectively, is included in rental income on the statements of comprehensive income.

During the third quarter of 2020, we entered into a new lease with AAI for office space at Torrey Point to replace its existing lease at Torrey Reserve Campus. Rents commenced on March 1, 2021 for an initial lease term of ten years at an average annual rental rate of $0.2 million.

The Waikiki Beach Walk entities have a 47.7% investment in WBW CHP LLC, an entity that was formed to, among other things, construct a chilled water plant to provide air conditioning to the property and other adjacent facilities. The operating expenses of WBW CHP LLC are recovered through reimbursements from its members, and reimbursements to WBW CHP LLC of $0.3 million and $0.3 million for the three months ended March 31, 2021 and 2020, respectively, are included in rental expenses on the consolidated statements of comprehensive income.

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SEGMENT REPORTING

3 Months Ended

Mar. 31, 2021

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 March 31,
	2021		2020
Total Office
Property revenue	$	44,464	$	44,509
Property expense	(11,364)		(11,793)
Segment profit	33,100		32,716
Total Retail
Property revenue	21,774		25,826
Property expense	(7,442)		(7,331)
Segment profit	14,332		18,495
Total Multifamily
Property revenue	12,552		12,825
Property expense	(5,491)		(5,510)
Segment profit	7,061		7,315
Total Mixed-Use
Property revenue	5,196		13,583
Property expense	(5,303)		(8,979)
Segment profit	(107)		4,604
Total segments’ profit	$	54,386	$	63,130

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

	Three Months Ended March 31,
	2021		2020
Total segments’ profit	$	54,386	$	63,130
General and administrative	(6,823)		(6,820)
Depreciation and amortization	(27,501)		(27,462)
Interest expense	(14,005)		(13,472)
Early extinguishment of debt	(4,271)		—
Other income (expense), net	(53)		108
Net income	1,733		15,484
Net income attributable to restricted shares	(137)		(104)
Net income attributable to unitholders in the Operating Partnership	(339)		(3,312)
Net income attributable to American Assets Trust, Inc. stockholders	$	1,257	$	12,068

The following table shows net real estate and secured note payable balances for each of the segments (in thousands):

	March 31, 2021		December 31, 2020
Net Real Estate
Office	$	1,314,179	$	1,317,107
Retail	603,522		607,918
Multifamily	387,106		389,804
Mixed-Use	176,510		177,905
	$	2,481,317	$	2,492,734
Secured Notes Payable (1)
Office	$	111,000	$	111,000
	$	111,000	$	111,000

(1)Excludes debt issuance costs of $0.1 million and $0.1 million for each of the periods ended March 31, 2021 and December 31, 2020, respectively.

Capital expenditures for each segment for the three months ended March 31, 2021 and 2020 were as follows (in thousands):

	Three Months Ended March 31,
	2021		2020
Capital Expenditures (1)
Office	$	9,527	$	18,200
Retail	1,722		3,558
Multifamily	963		1,284
Mixed-Use	4		883
	$	12,216	$	23,925

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

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

3 Months Ended

Mar. 31, 2021

Accounting Policies [Abstract]

Business and Organization

Business and Organization

American Assets Trust, Inc. (which may be referred to in these financial statements as the “Company,” “we,” “us,” or “our”) is a Maryland corporation formed on July 16, 2010 that did not have any operating activity until the consummation of our initial public offering on January 19, 2011. The Company is the sole general partner of American Assets Trust, L.P., a Maryland limited partnership formed on July 16, 2010 (the “Operating Partnership”). The Company’s operations are carried on through our Operating Partnership and its subsidiaries, including our taxable real estate investment trust ("REIT") subsidiary ("TRS"). Since the formation of our Operating Partnership, the Company has controlled our Operating Partnership as its general partner and has consolidated its assets, liabilities and results of operations.

We are a full service, vertically integrated, and self-administered REIT with approximately 190 employees providing substantial in-house expertise in asset management, property management, property development, leasing, tenant improvement construction, acquisitions, repositioning, redevelopment and financing.

As of March 31, 2021, we owned or had a controlling interest in 28 office, retail, multifamily and mixed-use operating properties, the operations of which we consolidate. Additionally, as of March 31, 2021, we owned land at three of our properties that we classify as held for development and/or construction in progress. A summary of the properties owned by us is as follows:

Retail
Carmel Country Plaza	Gateway Marketplace	Alamo Quarry Market
Carmel Mountain Plaza	Del Monte Center	Hassalo on Eighth - Retail
South Bay Marketplace	Geary Marketplace
Lomas Santa Fe Plaza	The Shops at Kalakaua
Solana Beach Towne Centre	Waikele Center
Office
La Jolla Commons	One Beach Street
Torrey Reserve Campus	First & Main
Torrey Point	Lloyd Portfolio
Solana Crossing (formerly Solana Beach Corporate Centre)	City Center Bellevue
The Landmark at One Market
Multifamily
Loma Palisades	Hassalo on Eighth - Residential
Imperial Beach Gardens
Mariner's Point
Santa Fe Park RV Resort
Pacific Ridge Apartments
Mixed-Use
Waikiki Beach Walk Retail and Embassy Suites™ Hotel
Held for Development and/or Construction in Progress
La Jolla Commons – Land
Solana Crossing – Land
Lloyd Portfolio – Construction in Progress

Basis of Presentation

Basis of Presentation

Our consolidated financial statements include the accounts of the Company, our Operating Partnership and our subsidiaries. The equity interests of other investors in our Operating Partnership are reflected as noncontrolling interests.

The Company follows the Financial Accounting Standards Board (the "FASB") guidance for determining whether an entity is a variable interest entity (“VIE”) and requires the performance of a qualitative rather than a quantitative analysis to determine the primary beneficiary of a VIE. Under this guidance, an entity would be required to consolidate a VIE if it has (i) the power to direct the activities that most significantly impact the entity’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could be significant to the VIE. American Assets Trust, Inc. has concluded that the Operating Partnership is a VIE, and because American Assets Trust, Inc. has both the power and the rights to control the Operating Partnership, American Assets Trust, Inc. is the primary beneficiary and is required to continue to consolidate the Operating Partnership.Substantially all of the assets and liabilities of the Company are related to the operating partnership VIE.

All intercompany transactions and balances are eliminated in consolidation.

The accompanying consolidated financial statements of the Company and the Operating Partnership have been prepared in accordance with the rules applicable to Form 10-Q and include all information and footnotes required for interim financial statement presentation, but do not include all disclosures required under accounting principles generally accepted in the United States (“GAAP”) for annual financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments, except as otherwise noted) considered necessary for a fair presentation have been included. These financial statements should be read in conjunction with the audited consolidated financial statements and notes therein included in the Company's and Operating Partnership's annual report on Form 10-K for the year ended December 31, 2020.

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that in certain circumstances affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and revenues and expenses. These estimates are prepared using our best judgment, after considering past, current and expected events and economic conditions. Actual results could differ from these estimates.

Any reference to the number of properties, number of units, square footage, employee numbers or percentages of beneficial ownership of our shares are unaudited and outside the scope of our independent registered public accounting firm’s review of our financial statements in accordance with the standards of the United States Public Company Accounting Oversight Board.

Significant Accounting Policies

Significant Accounting PoliciesWe describe our significant accounting policies in Note 1 to the consolidated financial statements in Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2020. There have been no changes to our significant accounting policies during the three months ended March 31, 2021.

Segment Information

Segment InformationSegment information is prepared on the same basis that our chief operating decision maker 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.

Revenue Recognition, Leases

Revenue Recognition and Accounts Receivable

Our leases with tenants are classified as operating leases. Substantially all such leases contain fixed rent escalations which occur at specified times during the term of the lease. Base rents are recognized on a straight-line basis from when the tenant controls the space through the term of the related lease, net of valuation adjustments, based on management's assessment of credit, collection and other business risks.

We make estimates of the collectability of our current accounts receivable and straight-line rents receivable which require significant judgment by management. The collectability of receivables is affected by numerous different factors including current economic conditions, including the impact of tenant bankruptcies, the status of collectability of current cash rents receivable, tenants' recent and historical financial and operating results, changes in our tenants' credit ratings, communications between our operating personnel and tenants, the extent of security deposits and letters of credit held with respect to tenants, and the ability of the tenant to perform under the terms of their lease agreement. The provision for doubtful accounts at March 31, 2021 and December 31, 2020 was approximately $12.2 million and $10.0 million, respectively.

Rent Concessions – COVID-19

During the first quarter of 2021, we provided lease concessions to certain tenants, primarily within the retail segment, as a result of the COVID-19 pandemic, in the form of rent deferrals and abatements. These lease concessions generally included an increase in our rights as a lessor. We assess each lease concession and determine whether it represents a lease modifications under Accounting Standards Codification Topic 842, Leases ("ASC 842"). As of March 31, 2021, we have entered into lease modifications that resulted in adjustments (including rent deferrals and other monetary lease concessions) due to the impact of the COVID-19 pandemic of approximately $1.2 million or 2% of the rent originally contracted for the three months ended March 31, 2021. For the first quarter of 2021, we collected approximately $0.7 million or 88% of the deferred rent repayments due during the period.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2016-13, Financial Instruments - Credit Topics. The pronouncement requires companies to adopt a new approach to estimating credit losses on certain types of financial instruments, such as trade and other receivables and loans. The standard requires entities to estimate a lifetime expected credit loss for most financial instruments, including trade receivables. In November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses, which clarifies that receivables arising from operating leases are not within the scope of the pronouncement. We adopted the provisions of ASU No. 2016-13 effective January 1, 2020 and the adoption did not have a material impact on our consolidated financial statements as the majority of our receivables are derived from operating leases and are excluded from this standard.

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848), which provides companies with optional practical expedients to ease the accounting burden for contract modifications associated with transitioning away from LIBOR and other interbank offered rates that are expected to be discontinued as part of reference rate reform. For hedges, the

guidance generally allows changes to the reference rate and other critical terms without having to de-designate the hedging relationship, as well as allows the shortcut method to continue to be applied. For contract modifications, changes in the reference rate or other critical terms will be treated as a continuation of the prior contract. This guidance can be applied immediately, however, is generally only available through December 31, 2022. We are still evaluating the impact of reference rate reform and whether we will apply any of these practical expedients.

Fair Value Measurement

A fair value measurement is based on the assumptions that market participants would use in pricing an asset or liability. The hierarchy for inputs used in measuring fair value is as follows:

1.Level 1 Inputs—quoted prices in active markets for identical assets or liabilities

2.Level 2 Inputs—observable inputs other than quoted prices in active markets for identical assets and liabilities

3.Level 3 Inputs—unobservable inputs

The carrying values of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued liabilities are reasonable estimates of fair value, using Level 1 inputs, because of the short-term nature of these instruments. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

3 Months Ended

Mar. 31, 2021

Accounting Policies [Abstract]

Consolidated Statements of Cash Flows-Supplemental Disclosures

The following table provides supplemental disclosures related to the Consolidated Statements of Cash Flows (in thousands): 

	Three Months Ended March 31,
	2021		2020
Supplemental cash flow information
Total interest costs incurred	$	14,564	$	13,736
Interest capitalized	$	559	$	264
Interest expense	$	14,005	$	13,472
Cash paid for interest, net of amounts capitalized	$	13,069	$	15,043
Cash paid for income taxes	$	71	$	51
Supplemental schedule of noncash investing and financing activities
Accounts payable and accrued liabilities for construction in progress	$	7,109	$	16,541
Accrued leasing commissions	$	631	$	2,083

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ACQUIRED IN-PLACE LEASES AND ABOVE/BELOW MARKET LEASES (Tables)

3 Months Ended

Mar. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of acquired lease intangibles included in other assets and other liabilities

The following summarizes our acquired lease intangibles and leasing costs, which are included in other assets and other liabilities and deferred credits, as of March 31, 2021 and December 31, 2020 (in thousands): 

	March 31, 2021		December 31, 2020
In-place leases	$	60,447	$	60,965
Accumulated amortization	(35,324)		(34,758)
Above market leases	4,665		5,389
Accumulated amortization	(4,551)		(5,268)
Acquired lease intangible assets, net	$	25,237	$	26,328
Below market leases	$	56,666	$	56,677
Accumulated accretion	(35,993)		(35,219)
Acquired lease intangible liabilities, net	$	20,673	$	21,458

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FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

3 Months Ended

Mar. 31, 2021

Fair Value Disclosures [Abstract]

Financial liabilities measured at fair value on recurring basis

A summary of our financial liabilities that are measured at fair value on a recurring basis, by level within the fair value hierarchy is as follows (in thousands):

	March 31, 2021								December 31, 2020
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Deferred compensation liability	$	—	$	2,158	$	—	$	2,158	$	—	$	2,059	$	—	$	2,059
Interest rate swap liability	$	—	$	3,784	$	—	$	3,784	$	—	$	4,531	$	—	$	4,531

Carrying amount and fair value of financial instruments

A summary of the carrying amount and fair value of our secured financial instruments, all of which are based on Level 2 inputs, is as follows (in thousands):  

	March 31, 2021				December 31, 2020
	Carrying Value		Fair Value		Carrying Value		Fair Value
Secured notes payable, net	$	110,934	$	113,364	$	110,923	$	114,074
Unsecured term loans, net	$	249,338	$	250,000	$	249,233	$	250,000
Unsecured senior guaranteed notes, net	$	797,645	$	827,895	$	947,444	$	1,017,378
Senior unsecured notes, net	$	489,907	$	493,790	$	—	$	—
Unsecured line of credit, net	$	—	$	—	$	99,151	$	100,000

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DERIVATIVE AND HEDGING ACTIVITIES (Tables)

3 Months Ended

Mar. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Interest Rate Derivatives

The following is a summary of the terms of our outstanding interest rate swaps as of March 31, 2021 (dollars in thousands):

Swap Counterparty	Notional Amount		Effective Date	Maturity Date	Fair Value
U.S. Bank N.A.	$	100,000	3/1/2016	3/1/2023	$	(2,533)
Wells Fargo Bank, N.A.	$	50,000	5/2/2016	3/1/2023	$	(1,251)

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OTHER ASSETS (Tables)

3 Months Ended

Mar. 31, 2021

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Components of Other Assets

Other assets consist of the following (in thousands): 

	March 31, 2021		December 31, 2020
Leasing commissions, net of accumulated amortization of $36,529 and $35,167, respectively	$	37,385	$	38,173
Acquired above market leases, net	114		121
Acquired in-place leases, net	25,123		26,207
Lease incentives, net of accumulated amortization of $862 and $802, respectively	934		994
Other intangible assets, net of accumulated amortization of $1,277 and $1,213, respectively	2,486		2,565
Debt issuance costs, net of accumulated amortization of $1,324 and $0, respectively	746		—
Right-of-use lease asset, net	28,583		29,350
Prepaid expenses and other	7,787		8,702
Total other assets	$	103,158	$	106,112

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OTHER LIABILITIES AND DEFERRED CREDITS (Tables)

3 Months Ended

Mar. 31, 2021

Other Liabilities Disclosure [Abstract]

Other liabilities and deferred credits

Other liabilities and deferred credits consist of the following (in thousands):

	March 31, 2021		December 31, 2020
Acquired below market leases, net	$	20,673	$	21,458
Prepaid rent and deferred revenue	14,371		14,518
Interest rate swap liability	3,784		4,531
Deferred rent expense and lease intangible	13		16
Deferred compensation	2,158		2,059
Deferred tax liability	570		570
Straight-line rent liability	17,156		18,049
Lease liability	29,471		30,060
Other liabilities	32		39
Total other liabilities and deferred credits, net	$	88,228	$	91,300

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DEBT (Tables)

3 Months Ended

Mar. 31, 2021

Debt Disclosure [Abstract]

Summary of total secured notes payable outstanding

The following is a summary of our total secured notes payable outstanding as of March 31, 2021 and December 31, 2020 (in thousands):

	Principal Balance as of				Stated Interest Rate		Stated Maturity Date
Description of Debt	March 31, 2021		December 31, 2020		as of March 31, 2021
City Center Bellevue (1)	111,000		111,000		3.98	%	November 1, 2022
	111,000		111,000
Debt issuance costs, net of accumulated amortization of $355 and $345, respectively	(66)		(77)
Total Secured Notes Payable Outstanding	$	110,934	$	110,923

(1)Interest only.

The following is a summary of the Operating Partnership's total unsecured notes payable outstanding as of March 31, 2021 and December 31, 2020 (in thousands):

Description of Debt	Principal Balance as of				Stated Interest Rate			Stated Maturity Date
	March 31, 2021		December 31, 2020		as of March 31, 2021
Term Loan A	$	100,000	$	100,000	Variable		(1)	January 9, 2022
Senior Guaranteed Notes, Series A (2)	—		150,000		4.04	%	(3)	October 31, 2021
Term Loan B	100,000		100,000		Variable		(4)	March 1, 2023
Term Loan C	50,000		50,000		Variable		(5)	March 1, 2023
Senior Guaranteed Notes, Series F	100,000		100,000		3.78	%	(6)	July 19, 2024
Senior Guaranteed Notes, Series B	100,000		100,000		4.45	%		February 2, 2025
Senior Guaranteed Notes, Series C	100,000		100,000		4.50	%		April 1, 2025
Senior Guaranteed Notes, Series D	250,000		250,000		4.29	%	(7)	March 1, 2027
Senior Guaranteed Notes, Series E	100,000		100,000		4.24	%	(8)	May 23, 2029
Senior Guaranteed Notes, Series G	150,000		150,000		3.91	%	(9)	July 30, 2030
3.375% Senior Unsecured Notes	500,000		—		3.38	%		February 1, 2031
	1,550,000		1,200,000
Debt discount and issuance costs, net of accumulated amortization of $9,463 and $8,856, respectively	(13,110)		(3,323)
Total Unsecured Notes Payable	$	1,536,890	$	1,196,677

(1)The Operating Partnership has entered into an interest rate swap agreement that is intended to fix the interest rate associated with Term Loan A at approximately 4.13% through the interest rate swap maturity date of January 9, 2021, subject to adjustments based on our consolidated leverage ratio. Subsequent to January 9, 2021, the interest rate associated with Term Loan A will be variable as described below.

(2)Notes prepaid in full, with make-whole penalty thereon of approximately $3.9 million, on January 26, 2021.

(3)The Operating Partnership entered into a one-month forward-starting seven years swap contract on August 19, 2014, which was settled on September 19, 2014 at a gain of approximately $1.6 million. The forward-starting seven-year swap contract was deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 3.88% per annum. On January 26, 2021, we prepaid the entirety of the Senior Guaranteed Notes, Seres A with make-whole premium thereon.

(4)The Operating Partnership has entered into an interest rate swap agreement that is intended to fix the interest rate associated with Term Loan B at approximately 3.15% through its maturity date, subject to adjustments based on our consolidated leverage ratio. Effective March 1, 2018, the effective interest rate associated with Term Loan B is approximately 2.75%, subject to adjustments based on our consolidated leverage ratio.

(5)The Operating Partnership has entered into an interest rate swap agreement that is intended to fix the interest rate associated with Term Loan C at approximately 3.14% through its maturity date, subject to adjustments based on our consolidated leverage ratio. Effective March 1, 2018, the effective interest rate associated with Term Loan C is approximately 2.74%, subject to adjustments based on our consolidated leverage ratio.

(6)The Operating Partnership entered into a treasury lock contract on May 31, 2017, which was settled on June 23, 2017 at a loss of approximately $0.5 million. The treasury lock contract was deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 3.85% per annum.

(7)The Operating Partnership entered into forward-starting interest rate swap contracts on March 29, 2016 and April 7, 2016, which were settled on January 18, 2017 at a gain of approximately $10.4 million. Each of the forward-starting interest swap rate contracts were deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 3.87% per annum.

(8)The Operating Partnership entered into a treasury lock contract on April 25, 2017, which was settled on May 11, 2017 at a gain of approximately $0.7 million. The treasury lock contract was deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 4.18% per annum.

(9)The Operating Partnership entered into a treasury lock contract on June 20, 2019, which was settled on July 17, 2019 at a gain of approximately $0.5 million. The treasury lock contract was deemed to be a highly effective cash flow hedge, accordingly, the effective interest rate is approximately 3.88% per annum.

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EQUITY OF AMERICAN ASSETS TRUST, INC. (Tables)

3 Months Ended

Mar. 31, 2021

Equity [Abstract]

Dividends declared and paid on shares of common stock and noncontrolling common units

The following table lists the dividends declared and paid on our shares of common stock and noncontrolling common units during the three months ended March 31, 2021: 

Period	Amount per Share/Unit		Period Covered	Dividend Paid Date
First Quarter 2021	$	0.28	January 1, 2021 to March 31, 2021	March 25, 2021

Activity of restricted stock awards

The following table summarizes the activity of restricted stock awards during the three months ended March 31, 2021:

	Units	Weighted Average Grant Date Fair Value
Nonvested at January 1, 2021	491,957	$23.53
Granted	—	—
Vested	—	—
Forfeited	(4,006)	23.24
Nonvested at March 31, 2021	487,951	$23.54

Computation of basic and diluted EPS

The computation of basic and diluted EPS is presented below (dollars in thousands, except share and per share amounts): 

	Three Months Ended March 31,
	2021		2020
NUMERATOR
Net income	$	1,733	$	15,484
Less: Net income attributable to restricted shares	(137)		(104)
Less: Income from operations attributable to unitholders in the Operating Partnership	(339)		(3,312)
Net income attributable to common stockholders—basic	$	1,257	$	12,068
Income from operations attributable to American Assets Trust, Inc. common stockholders—basic	$	1,257	$	12,068
Plus: Income from operations attributable to unitholders in the Operating Partnership	339		3,312
Net income attributable to common stockholders—diluted	$	1,596	$	15,380
DENOMINATOR
Weighted average common shares outstanding—basic	59,984,335		59,723,072
Effect of dilutive securities—conversion of Operating Partnership units	16,181,537		16,390,548
Weighted average common shares outstanding—diluted	76,165,872		76,113,620
Earnings per common share, basic	$	0.02	$	0.20
Earnings per common share, diluted	$	0.02	$	0.20

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LEASES (Tables)

3 Months Ended

Mar. 31, 2021

Leases [Abstract]

Current minimum future rentals under the leases

As of March 31, 2021, minimum future rentals from noncancelable operating leases, before any reserve for uncollectible amounts and assuming no early lease terminations, at our office and retail properties and the retail portion of our mixed-use property are as follows (in thousands):

Year Ending December 31,
2021 (nine months ending December 31, 2021)	$	162,655
2022	215,710
2023	199,077
2024	168,525
2025	147,434
Thereafter	443,310
Total	$	1,336,711

Current minimum annual payments under the leases

Current annual payments under the operating leases are as follows, as of March 31, 2021 (in thousands): 

Year Ending December 31,
2021 (nine months ending December 31, 2021)	$	2,350
2022	3,232
2023	3,328
2024	3,428
2025	3,531
Thereafter	19,710
Total lease payments	$	35,579
Imputed interest	$	(6,108)
Present value of lease liability	$	29,471

Lease costs under operating leases and supplemental cash flow information of leases

Lease costs under the operating leases are as follows (in thousands):    

	Three Months Ended March 31,
	2021			2020
Operating lease cost	$	1,132		$	844
Variable lease cost	—			—
Sublease income	(1,194)			(868)
Total lease (income) cost	$	(62)		$	(24)
Weighted-average remaining lease term - operating leases (in years)	10.0
Weighted-average discount rate - operating leases	3.21		%

Supplemental cash flow information and non-cash activity related to our operating leases are as follow (in thousands):

	Three Months Ended March 31,
	2021		2020
Operating cash flow information:
Cash paid for amounts included in the measurement of lease liabilities	$	865	$	846
Non-cash activity:
Right-of-use assets obtained in exchange for operating lease obligations	$	—	$	22,188

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COMPONENTS OF RENTAL INCOME AND EXPENSE (Tables)

3 Months Ended

Mar. 31, 2021

Revenue Recognition and Deferred Revenue [Abstract]

Principal components of rental income

The principal components of rental income are as follows (in thousands): 

	Three Months Ended March 31,
	2021		2020
Lease rental income
Office	$	43,362	$	42,213
Retail	20,853		24,955
Multifamily	11,752		11,967
Mixed-use	795		3,932
Percentage rent	526		301
Hotel revenue	3,271		8,125
Other	571		577
Total rental income	$	81,130	$	92,070

Principal components of rental expenses

The principal components of rental expenses are as follows (in thousands): 

	Three Months Ended March 31,
	2021		2020
Rental operating	$	9,496	$	9,882
Hotel operating	2,724		5,747
Repairs and maintenance	3,742		4,297
Marketing	393		507
Rent	1,152		853
Hawaii excise tax	532		865
Management fees	207		417
Total rental expenses	$	18,246	$	22,568

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OTHER (EXPENSE) INCOME, NET (Tables)

3 Months Ended

Mar. 31, 2021

Other Income and Expenses [Abstract]

Principal components of other expense, net

The principal components of other expense, net, are as follows (in thousands):

	Three Months Ended March 31,
	2021		2020
Interest and investment income	$	74	$	312
Income tax expense	(127)		(206)
Other non-operating income	—		2
Total other (expense) income, net	$	(53)	$	108

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SEGMENT REPORTING (Tables)

3 Months Ended

Mar. 31, 2021

Segment Reporting [Abstract]

Schedule of segments operating activity

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

	Three Months Ended March 31,
	2021		2020
Total Office
Property revenue	$	44,464	$	44,509
Property expense	(11,364)		(11,793)
Segment profit	33,100		32,716
Total Retail
Property revenue	21,774		25,826
Property expense	(7,442)		(7,331)
Segment profit	14,332		18,495
Total Multifamily
Property revenue	12,552		12,825
Property expense	(5,491)		(5,510)
Segment profit	7,061		7,315
Total Mixed-Use
Property revenue	5,196		13,583
Property expense	(5,303)		(8,979)
Segment profit	(107)		4,604
Total segments’ profit	$	54,386	$	63,130

Reconciliation of segment profit to net income attributable to stockholders

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

	Three Months Ended March 31,
	2021		2020
Total segments’ profit	$	54,386	$	63,130
General and administrative	(6,823)		(6,820)
Depreciation and amortization	(27,501)		(27,462)
Interest expense	(14,005)		(13,472)
Early extinguishment of debt	(4,271)		—
Other income (expense), net	(53)		108
Net income	1,733		15,484
Net income attributable to restricted shares	(137)		(104)
Net income attributable to unitholders in the Operating Partnership	(339)		(3,312)
Net income attributable to American Assets Trust, Inc. stockholders	$	1,257	$	12,068

Net real estate and secured note payable balances by segments

The following table shows net real estate and secured note payable balances for each of the segments (in thousands):

	March 31, 2021		December 31, 2020
Net Real Estate
Office	$	1,314,179	$	1,317,107
Retail	603,522		607,918
Multifamily	387,106		389,804
Mixed-Use	176,510		177,905
	$	2,481,317	$	2,492,734
Secured Notes Payable (1)
Office	$	111,000	$	111,000
	$	111,000	$	111,000

(1)Excludes debt issuance costs of $0.1 million and $0.1 million for each of the periods ended March 31, 2021 and December 31, 2020, respectively.

Capital expenditures for each segment

Capital expenditures for each segment for the three months ended March 31, 2021 and 2020 were as follows (in thousands):

	Three Months Ended March 31,
	2021		2020
Capital Expenditures (1)
Office	$	9,527	$	18,200
Retail	1,722		3,558
Multifamily	963		1,284
Mixed-Use	4		883
	$	12,216	$	23,925

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

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Millions	3 Months Ended
	Mar. 31, 2021 USD ($) Employee Room Segment Property	Dec. 31, 2020 USD ($)
Accounting Policies [Abstract]
Number of employees | Employee	190
Office, retail, multifamily, and mixed-use operating properties | Property	28
Properties held for development | Property	3
Number of operating segments | Segment	4
Room in mixed-use segment all-suite hotel | Room	369
Allowance for Doubtful Accounts, Rent Receivables	$ 12.2	$ 10.0
Rent Concessions - COVID-19	$ 1.2
Rent Concessions - COVID-19 (Percentage)	2.00%
Deferred Rent Repayments - COVID-19	$ 0.7
Deferred Rent Repayments - COVID-19 (Percentage)	88.00%

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Supplement Disclosures Related to Consolidated Statements of Cash Flows (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Accounting Policies [Abstract]
Total interest costs incurred	$ 14,564	$ 13,736
Interest capitalized	559	264
Interest expense	14,005	13,472
Cash paid for interest, net of amounts capitalized	13,069	15,043
Cash paid for income taxes	71	51
Accounts payable and accrued liabilities for construction in progress	7,109	16,541
Accrued leasing commissions	$ 631	$ 2,083

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ACQUIRED IN-PLACE LEASES AND ABOVE/BELOW MARKET LEASES Acquired Lease Intangibles and Leasing Costs Included in Other Assets and Other Liabilities and Deferred Credits (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Acquired Finite-Lived Intangible Assets [Line Items]
Leases, gross	$ 114	$ 121
Accumulated amortization	(1,277)	(1,213)
Below market leases	56,666	56,677
Accumulated accretion	(35,993)	(35,219)
Acquired lease intangible liabilities, net	20,673	21,458
Leases
Acquired Finite-Lived Intangible Assets [Line Items]
Acquired lease intangible assets, net	25,237	26,328
In-place leases
Acquired Finite-Lived Intangible Assets [Line Items]
Leases, gross	60,447	60,965
Accumulated amortization	(35,324)	(34,758)
Above market leases
Acquired Finite-Lived Intangible Assets [Line Items]
Leases, gross	4,665	5,389
Accumulated amortization	$ (4,551)	$ (5,268)

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FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - Fair Value, Inputs, Level 2	Mar. 31, 2021
Minimum
Fair Value Inputs Disclosures
Fair value assumptions, interest rate (as a percent)	0.027
Maximum
Fair Value Inputs Disclosures
Fair value assumptions, interest rate (as a percent)	0.039

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FAIR VALUE OF FINANCIAL INSTRUMENTS - Financial Liabilities Fair Value Measurement on a Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Deferred compensation liability	$ 2,158	$ 2,059
Interest rate swap liability	3,784	4,531
Fair Value, Inputs, Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Deferred compensation liability	0	0
Interest rate swap liability	0	0
Fair Value, Inputs, Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Deferred compensation liability	2,158	2,059
Interest rate swap liability	3,784	4,531
Fair Value, Inputs, Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Deferred compensation liability	0	0
Interest rate swap liability	$ 0	$ 0

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FAIR VALUE OF FINANCIAL INSTRUMENTS - Carrying Amount and Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Repayments of Unsecured Debt	$ 155,375	$ 0
Secured notes payable, net | Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	110,934		$ 110,923
Unsecured term loans, net | Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	249,338		249,233
Unsecured senior guaranteed notes, net | Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	797,645		947,444
Unsecured line of credit, net | Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	0		99,151
Senior Unsecured Notes | Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	489,907		0
Fair Value, Inputs, Level 2 | Secured notes payable, net | Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	113,364		114,074
Fair Value, Inputs, Level 2 | Unsecured term loans, net | Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	250,000		250,000
Fair Value, Inputs, Level 2 | Unsecured senior guaranteed notes, net | Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	827,895		1,017,378
Fair Value, Inputs, Level 2 | Unsecured line of credit, net | Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	0		100,000
Fair Value, Inputs, Level 2 | Senior Unsecured Notes | Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	$ 493,790		$ 0

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DERIVATIVE AND HEDGING ACTIVITIES (Details) - USD ($)						3 Months Ended
	Jul. 17, 2019	May 11, 2017	Jan. 18, 2017	Sep. 19, 2014	Aug. 19, 2014	Mar. 31, 2021
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Estimated derivative reclassification from Accumulated OCI to Income						$ 1,100,000
American Assets Trust, L.P. | Forward Contracts
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative contract term					7 years
Gain on derivative settlement	$ 500,000	$ 700,000	$ 10,400,000	$ 1,600,000
Designated as Hedging Instrument | Cash Flow Hedging | American Assets Trust, L.P. | Interest Rate Swap, 3/1/2023 | Wells Fargo Bank, N.A.
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Notional Amount						$ 50,000,000
Effective Date						May 02, 2016
Maturity Date						Mar. 01, 2023
Interest rate swap liability						$ (1,251,000)
Interest Rate Derivative Liabilities, at Fair Value						1,251,000
Designated as Hedging Instrument | Cash Flow Hedging | American Assets Trust, L.P. | Interest Rate Swap, 3/1/2023 | U.S. Bank N.A.
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Notional Amount						$ 100,000,000
Effective Date						Mar. 01, 2016
Maturity Date						Mar. 01, 2023
Interest rate swap liability						$ (2,533,000)
Interest Rate Derivative Liabilities, at Fair Value						$ 2,533,000

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OTHER ASSETS (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Leasing commissions, net of accumulated amortization of $36,529 and $35,167, respectively	$ 37,385	$ 38,173
Acquired above market leases, net	114	121
Acquired in-place leases, net	25,123	26,207
Lease incentives, net of accumulated amortization of $862 and $802, respectively	934	994
Other intangible assets, net of accumulated amortization of $1,277 and $1,213, respectively	2,486	2,565
Debt issuance costs, net of accumulated amortization of $1,324 and $0, respectively	746	0
Right-of-use lease asset, net	28,583	29,350
Prepaid expenses and other	7,787	8,702
Total other assets	103,158	106,112
Leasing commissions, accumulative amortization	(36,529)	(35,167)
Lease incentives, accumulated amortization	(862)	(802)
Other intangible assets, accumulated amortization	(1,277)	(1,213)
Debt issuance costs, accumulated amortization	$ (1,324)	$ 0

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OTHER LIABILITIES AND DEFERRED CREDITS (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Other Liabilities Disclosure [Abstract]
Acquired below market leases, net	$ 20,673	$ 21,458
Prepaid rent and deferred revenue	14,371	14,518
Interest rate swap liability	3,784	4,531
Deferred rent expense and lease intangible	13	16
Deferred compensation	2,158	2,059
Deferred tax liability	570	570
Straight-line rent liability	17,156	18,049
Lease liability	29,471	30,060
Other liabilities	32	39
Total other liabilities and deferred credits, net	$ 88,228	$ 91,300

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DEBT - Summary of Total Secured Notes Payable Outstanding (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Debt issuance costs, net	$ (746)	$ 0
Debt issuance costs, accumulated amortization	1,324	0
American Assets Trust, L.P. | Secured notes payable, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance	111,000	111,000
Debt issuance costs, net	(66)	(77)
Total Debt Outstanding	110,934	110,923
Debt issuance costs, accumulated amortization	355	345
American Assets Trust, L.P. | City Center Bellevue | Secured notes payable, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance	$ 111,000	$ 111,000
Stated Interest Rate	3.98%
Stated Maturity Date	Nov. 01, 2022

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DEBT - Summary of Total Unsecured Notes Payable Outstanding (Details) - USD ($) $ in Thousands							3 Months Ended
	Jul. 17, 2019	Jun. 23, 2017	May 11, 2017	Jan. 18, 2017	Sep. 19, 2014	Aug. 19, 2014	Mar. 31, 2021	Jan. 26, 2021	Dec. 31, 2020	Dec. 31, 2018
Debt Instrument [Line Items]
Debt issuance costs, net							$ (746)		$ 0
Debt issuance costs, accumulated amortization							1,324		0
American Assets Trust, L.P. | Forward Contracts
Debt Instrument [Line Items]
Derivative contract term						7 years
Gain on derivative settlement	$ 500		$ 700	$ 10,400	$ 1,600
Loss on derivative settlement		$ 500
American Assets Trust, L.P. | Unsecured term loans, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance							1,550,000		1,200,000
Debt issuance costs, net							(13,110)		(3,323)
Total Debt Outstanding							1,536,890		1,196,677
Debt issuance costs, accumulated amortization							$ 9,463		8,856
American Assets Trust, L.P. | Term Loan A | Interest Rate Swap
Debt Instrument [Line Items]
Derivative fixed interest rate (in percent)							4.13%
American Assets Trust, L.P. | Term Loan A | Unsecured term loans, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance							$ 100,000		100,000
Stated Maturity Date							Jan. 09, 2022
American Assets Trust, L.P. | Senior Guaranteed Notes, Series A | Forward Contracts
Debt Instrument [Line Items]
Effective rate of debt instrument (in percent)							3.88%
American Assets Trust, L.P. | Senior Guaranteed Notes, Series A | Unsecured term loans, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance							$ 0		150,000
Stated Interest Rate							4.04%
Stated Maturity Date							Oct. 31, 2021
American Assets Trust, L.P. | Term Loan B | Interest Rate Swap
Debt Instrument [Line Items]
Derivative fixed interest rate (in percent)							2.75%			3.15%
American Assets Trust, L.P. | Term Loan B | Unsecured term loans, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance							$ 100,000		100,000
Stated Maturity Date							Mar. 01, 2023
American Assets Trust, L.P. | Term Loan C | Interest Rate Swap
Debt Instrument [Line Items]
Derivative fixed interest rate (in percent)							2.74%			3.14%
American Assets Trust, L.P. | Term Loan C | Unsecured term loans, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance							$ 50,000		50,000
Stated Maturity Date							Mar. 01, 2023
American Assets Trust, L.P. | Senior Guaranteed Notes, Series F | Forward Contracts
Debt Instrument [Line Items]
Effective rate of debt instrument (in percent)							3.85%
American Assets Trust, L.P. | Senior Guaranteed Notes, Series F | Unsecured term loans, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance							$ 100,000		100,000
Stated Interest Rate							3.78%
Stated Maturity Date							Jul. 19, 2024
American Assets Trust, L.P. | Senior Guaranteed Notes, Series B | Unsecured term loans, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance							$ 100,000		100,000
Stated Interest Rate							4.45%
Stated Maturity Date							Feb. 02, 2025
American Assets Trust, L.P. | Senior Guaranteed Notes, Series C | Unsecured term loans, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance							$ 100,000		100,000
Stated Interest Rate							4.50%
Stated Maturity Date							Apr. 01, 2025
American Assets Trust, L.P. | Senior Guaranteed Notes, Series D | Forward Contracts
Debt Instrument [Line Items]
Effective rate of debt instrument (in percent)							3.87%
American Assets Trust, L.P. | Senior Guaranteed Notes, Series D | Unsecured term loans, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance							$ 250,000		250,000
Stated Interest Rate							4.29%
Stated Maturity Date							Mar. 01, 2027
American Assets Trust, L.P. | Senior Guaranteed Notes, Series E | Forward Contracts
Debt Instrument [Line Items]
Effective rate of debt instrument (in percent)							4.18%
American Assets Trust, L.P. | Senior Guaranteed Notes, Series E | Unsecured term loans, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance							$ 100,000		100,000
Stated Interest Rate							4.24%
Stated Maturity Date							May 23, 2029
American Assets Trust, L.P. | Senior Guaranteed Notes, Series G | Forward Contracts
Debt Instrument [Line Items]
Effective rate of debt instrument (in percent)							3.88%
American Assets Trust, L.P. | Senior Guaranteed Notes, Series G | Unsecured term loans, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance							$ 150,000		150,000
Stated Interest Rate							3.91%
Stated Maturity Date							Jul. 30, 2030
American Assets Trust, L.P. | 3.375% Senior Unsecured Notes
Debt Instrument [Line Items]
Stated Interest Rate								3.375%
American Assets Trust, L.P. | 3.375% Senior Unsecured Notes | Unsecured term loans, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance							$ 500,000		$ 0
Stated Interest Rate							3.38%
Stated Maturity Date							Feb. 01, 2031

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DEBT - Narrative (Details)				3 Months Ended
	Jan. 26, 2021 USD ($)	Jan. 09, 2019 Extension_Option	Jan. 09, 2018 USD ($) Extension_Option	Mar. 31, 2021 USD ($)	Mar. 31, 2020 USD ($)	Dec. 31, 2020 USD ($)
Debt Instrument [Line Items]
Unsecured line of credit, net				$ 0		$ 99,151,000
Repayments of Unsecured Debt				155,375,000	$ 0
Early extinguishment of debt				(4,271,000)	0
Repayments of Lines of Credit				100,000,000	0
Unsecured term loans, net | Term Loan B | Federal Funds Rate
Debt Instrument [Line Items]
Basis spread on federal funds rate			0.50%
Unsecured term loans, net | Term Loan B | Eurodollar
Debt Instrument [Line Items]
Basis spread on Eurodollar rate			1.00%
Unsecured term loans, net | Term Loan C | Federal Funds Rate
Debt Instrument [Line Items]
Basis spread on federal funds rate			0.50%
Unsecured term loans, net | Term Loan C | Eurodollar
Debt Instrument [Line Items]
Basis spread on Eurodollar rate			1.00%
Unsecured term loans, net | Term Loan A | Federal Funds Rate
Debt Instrument [Line Items]
Basis spread on federal funds rate		0.50%
Unsecured term loans, net | Term Loan A | Eurodollar
Debt Instrument [Line Items]
Basis spread on Eurodollar rate		1.00%
Unsecured term loans, net | Second Amended and Restated Credit Facility | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Description of variable rate basis			LIBOR
Unsecured line of credit, net
Debt Instrument [Line Items]
Minimum fixed charge coverage ratio covenant threshold			1.50
Minimum unsecured leverage ratio			175.00%
Maximum leverage ratio of revolving credit facility			60.00%
Maximum secured leverage ratio on revolving credit facility			40.00%
Maximum unsecured leverage ratio			60.00%
Maximum recourse indebtedness of total asset value			15.00%
Unsecured line of credit, net | Second Amended and Restated Credit Facility | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Basis spread on variable rate			1.00%
Unsecured line of credit, net | Second Amended and Restated Credit Facility | Base Rate
Debt Instrument [Line Items]
Basis spread on federal funds rate			0.50%
American Assets Trust, L.P.
Debt Instrument [Line Items]
Unsecured line of credit, net				0		99,151,000
Repayments of Unsecured Debt				155,375,000	0
Early extinguishment of debt				(4,271,000)	0
Repayments of Lines of Credit				100,000,000	$ 0
American Assets Trust, L.P. | Term Loan B
Debt Instrument [Line Items]
Term of debt instrument			7 years
American Assets Trust, L.P. | Term Loan B | Minimum | Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate			0.70%
American Assets Trust, L.P. | Term Loan B | Maximum | Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate			1.35%
American Assets Trust, L.P. | Term Loan C
Debt Instrument [Line Items]
Term of debt instrument			7 years
American Assets Trust, L.P. | Term Loan C | Minimum | Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate			0.70%
American Assets Trust, L.P. | Term Loan C | Maximum | Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate			1.35%
American Assets Trust, L.P. | Term Loan A | Minimum | Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate		0.20%
American Assets Trust, L.P. | Term Loan A | Maximum | Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate		0.70%
American Assets Trust, L.P. | Second Amended and Restated Credit Facility
Debt Instrument [Line Items]
Revolving credit facility borrowing limit, maximum borrowing capacity			$ 450,000,000
Additional borrowing capacity			$ 250,000,000
American Assets Trust, L.P. | 3.375% Senior Unsecured Notes
Debt Instrument [Line Items]
Stated Interest Rate	3.375%
Proceeds from Debt, Net of Issuance Costs	$ 489,700,000
Debt Securities, Held-to-Maturity, Weighted Average Yield, Maturity, after Year 10	3.502%
Note Offering Percent	0.98935
American Assets Trust, L.P. | Unsecured term loans, net
Debt Instrument [Line Items]
Long-term Debt, Principal Balance				1,550,000,000		1,200,000,000
American Assets Trust, L.P. | Unsecured term loans, net | Senior Guaranteed Notes, Series G
Debt Instrument [Line Items]
Long-term Debt, Principal Balance				$ 150,000,000		150,000,000
Stated Interest Rate				3.91%
Stated Maturity Date				Jul. 30, 2030
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan B
Debt Instrument [Line Items]
Long-term Debt, Principal Balance				$ 100,000,000		100,000,000
Stated Maturity Date				Mar. 01, 2023
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan B | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Description of variable rate basis			LIBOR
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan B | Base Rate
Debt Instrument [Line Items]
Minimum base rate			0.00%
Prime rate			prime rate
Federal funds rate			federal funds rate
Eurodollar rate			Eurodollar
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan B | Minimum | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Basis spread on variable rate			1.20%
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan B | Maximum | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Basis spread on variable rate			1.70%
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan C
Debt Instrument [Line Items]
Long-term Debt, Principal Balance				$ 50,000,000		50,000,000
Stated Maturity Date				Mar. 01, 2023
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan C | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Description of variable rate basis			LIBOR
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan C | Base Rate
Debt Instrument [Line Items]
Minimum base rate			0.00%
Prime rate			prime rate
Federal funds rate			federal funds rate
Eurodollar rate			Eurodollar
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan C | Minimum | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Basis spread on variable rate			1.20%
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan C | Maximum | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Basis spread on variable rate			1.70%
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan A
Debt Instrument [Line Items]
Long-term Debt, Principal Balance				$ 100,000,000		100,000,000
Stated Maturity Date				Jan. 09, 2022
Debt extension options | Extension_Option		3
Extension term		1 year
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan A | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Description of variable rate basis		LIBOR
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan A | Base Rate
Debt Instrument [Line Items]
Prime rate		prime rate
Federal funds rate		federal funds rate
Eurodollar rate		Eurodollar
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan A | Minimum | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Basis spread on variable rate		1.20%
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan A | Maximum | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Basis spread on variable rate		1.70%
American Assets Trust, L.P. | Unsecured term loans, net | Term Loan B & Term Loan C
Debt Instrument [Line Items]
Face amount of debt			$ 150,000,000
American Assets Trust, L.P. | Unsecured term loans, net | Second Amended and Restated Credit Facility
Debt Instrument [Line Items]
Revolving credit facility borrowing limit, maximum borrowing capacity			$ 100,000,000
American Assets Trust, L.P. | Unsecured term loans, net | Second Amended and Restated Credit Facility | Minimum | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Basis spread on variable rate			1.30%
American Assets Trust, L.P. | Unsecured term loans, net | Second Amended and Restated Credit Facility | Minimum | Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate			0.30%
American Assets Trust, L.P. | Unsecured term loans, net | Second Amended and Restated Credit Facility | Maximum | London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Basis spread on variable rate			1.90%
American Assets Trust, L.P. | Unsecured term loans, net | Second Amended and Restated Credit Facility | Maximum | Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate			0.90%
American Assets Trust, L.P. | Unsecured term loans, net | Senior Guaranteed Notes, Series A
Debt Instrument [Line Items]
Long-term Debt, Principal Balance				$ 0		150,000,000
Stated Interest Rate				4.04%
Stated Maturity Date				Oct. 31, 2021
Repayments of Unsecured Debt	$ 150,000,000
Early extinguishment of debt	3,900,000
American Assets Trust, L.P. | Unsecured term loans, net | 3.375% Senior Unsecured Notes
Debt Instrument [Line Items]
Long-term Debt, Principal Balance				$ 500,000,000		$ 0
Stated Interest Rate				3.38%
Stated Maturity Date				Feb. 01, 2031
Face amount of debt	500,000,000
American Assets Trust, L.P. | Unsecured line of credit, net | Second Amended and Restated Credit Facility
Debt Instrument [Line Items]
Debt issuance costs, net, revolving credit facility				$ (700,000)
Weighted average interest rate, revolving credit facility				1.21%
Repayments of Lines of Credit	$ 100,000,000
American Assets Trust, L.P. | Unsecured line of credit, net | Second Amended and Restated Credit Facility | Revolving Credit Facility
Debt Instrument [Line Items]
Revolving credit facility borrowing limit, maximum borrowing capacity			$ 350,000,000
Debt extension options | Extension_Option			2
Extension term			6 months
American Assets Trust, L.P. | Unsecured line of credit, net | Second Amended and Restated Credit Facility | London Interbank Offered Rate (LIBOR) | Revolving Credit Facility
Debt Instrument [Line Items]
Description of variable rate basis			LIBOR
American Assets Trust, L.P. | Unsecured line of credit, net | Second Amended and Restated Credit Facility | Base Rate
Debt Instrument [Line Items]
Prime rate			prime rate
Federal funds rate			federal funds rate
American Assets Trust, L.P. | Unsecured line of credit, net | Second Amended and Restated Credit Facility | Minimum | London Interbank Offered Rate (LIBOR) | Revolving Credit Facility
Debt Instrument [Line Items]
Basis spread on variable rate			1.05%
American Assets Trust, L.P. | Unsecured line of credit, net | Second Amended and Restated Credit Facility | Minimum | Base Rate | Revolving Credit Facility
Debt Instrument [Line Items]
Basis spread on variable rate			0.10%
American Assets Trust, L.P. | Unsecured line of credit, net | Second Amended and Restated Credit Facility | Maximum | London Interbank Offered Rate (LIBOR) | Revolving Credit Facility
Debt Instrument [Line Items]
Basis spread on variable rate			1.50%
American Assets Trust, L.P. | Unsecured line of credit, net | Second Amended and Restated Credit Facility | Maximum | Base Rate | Revolving Credit Facility
Debt Instrument [Line Items]
Basis spread on variable rate			0.50%

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PARTNERS' CAPITAL OF AMERICAN ASSETS TRUST, L.P. (Details)	3 Months Ended
	Mar. 31, 2021 shares	Mar. 31, 2020 shares
Operating Partnership Units
Capital Unit [Line Items]
Antidilutive securities excluded from computation of EPS (in shares)	489,775	345,153
American Assets Trust, L.P.
Capital Unit [Line Items]
Percentage of ownership interests classified as noncontrolling	21.30%
American Assets Trust, L.P.
Capital Unit [Line Items]
Noncontrolling common units (in shares)	16,181,537
American Assets Trust, L.P. | Operating Partnership Units
Capital Unit [Line Items]
Weighted average unvested shares outstanding (in shares)	489,775	345,153
Antidilutive securities excluded from computation of EPS (in shares)	489,775	345,153
Limited Partner | American Assets Trust, L.P.
Capital Unit [Line Items]
Common unit conversion ratio	1
Common Shares | American Assets Trust, L.P.
Capital Unit [Line Items]
Conversion of operating partnership units (in shares)	0

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EQUITY OF AMERICAN ASSETS TRUST, INC. - Narrative (Details)			3 Months Ended
	Mar. 02, 2018 Agent	May 27, 2015 USD ($) Agent	Mar. 31, 2021 USD ($) shares	Mar. 31, 2020 USD ($) shares
Equity [Line Items]
Noncash compensation expense			$ 1,500,000	$ 1,300,000
Unrecognized compensation expense			$ 6,900,000
Operating Partnership Units
Equity [Line Items]
Antidilutive securities excluded from computation of EPS (in shares) | shares			489,775	345,153
At The Market Equity Program
Equity [Line Items]
Number of sales agents | Agent	1	5
Aggregate offering price of common share		$ 250,000,000.0
Remaining capacity to issue			$ 132,600,000
American Assets Trust, L.P. | Operating Partnership Units
Equity [Line Items]
Weighted average unvested shares outstanding (in shares) | shares			489,775	345,153
Antidilutive securities excluded from computation of EPS (in shares) | shares			489,775	345,153

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EQUITY OF AMERICAN ASSETS TRUST, INC. - Dividends Declare and Paid on Shares on Common Stock and Noncontrolling Common Units (Details)	3 Months Ended
	Sep. 30, 2020 $ / shares
Equity [Abstract]
Dividends period	First Quarter 2021
Amount per Share/Unit (in USD per unit)	$ 0.28
Date dividend to be paid	Mar. 25, 2021

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EQUITY OF AMERICAN ASSETS TRUST, INC. - Summary of Activity of Restricted Stock Awards (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Noncash compensation expense	$ 1.5	$ 1.3
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Nonvested, Beginning, Shares	491,957
Granted, Shares	0
Vested, Shares	0
Forfeited, Shares	(4,006)
Nonvested, End of year, shares	487,951
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Nonvested, Beginning, Weighted Average Grant Date Fair Value (in USD per share)	$ 23.53
Granted, Weighted Average Grant Date Fair Value (in USD per share)	0
Vested, Weighted Average Grant Date Fair Value (in USD per share)	0
Forfeited, Weighted Average Grant Date Fair Value (in USD per share)	23.24
Nonvested, End of Year, Weighted Average Grant Date Fair Value (in USD per share)	$ 23.54

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EQUITY OF AMERICAN ASSETS TRUST, INC. - Computation of Basic and Diluted EPS (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Equity [Abstract]
Net income	$ 1,733	$ 15,484
Less: Net income attributable to restricted shares	(137)	(104)
Less: Income from operations attributable to unitholders in the Operating Partnership	(339)	(3,312)
Net income attributable to common stockholders—basic	1,257	12,068
Income from operations attributable to American Assets Trust, Inc. common stockholders—basic	1,257	12,068
Plus: Income from operations attributable to unitholders in the Operating Partnership-diluted	339	3,312
Net income attributable to common stockholders-diluted	$ 1,596	$ 15,380
Weighted average common shares outstanding-basic (in shares)	59,984,335	59,723,072
Effect of dilutive securities-conversion of Operating Partnership units (in shares)	16,181,537	16,390,548
Weighted average common shares outstanding - diluted (in shares)	76,165,872	76,113,620
Earnings per common share, basic (in USD per share)	$ 0.02	$ 0.20
Earnings per common share, diluted (in USD per share)	$ 0.02	$ 0.20

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INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Income Tax Disclosure [Abstract]
Deferred tax liability	$ 570		$ 570
Income tax benefit (expense)	$ (127)	$ (206)

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COMMITMENTS AND CONTINGENCIES (Details) $ in Millions	3 Months Ended
	Mar. 31, 2021 USD ($) mo Property	Mar. 31, 2020
Commitment And Contingencies [Line Items]
Termination payment | $	$ 4.9
Number of consolidated properties located in Southern California | Property	15
Maximum proportion of total revenue provided by any single tenant (as a percent)	10.00%	10.00%
Total Revenues | Retail
Commitment And Contingencies [Line Items]
Proportion of total revenue provided by retail or office tenants (as a percent)	25.90%
Total Revenues | Office
Commitment And Contingencies [Line Items]
Proportion of total revenue provided by retail or office tenants (as a percent)	52.90%
Waikiki Beach Walk - Retail
Commitment And Contingencies [Line Items]
Property management fee (as a percent)	3.00%
Outrigger Hotels
Commitment And Contingencies [Line Items]
Property management fee (as a percent)	6.00%
Number of calendar months termination fee is based	2 months
Maximum proportion of hotel's fiscal year gross revenues paid for aggregate yearly management fee (as a percent)	3.50%
Previous months of management fees	12 months
Hotel management agreement default penalty factor of previous twelve months of management fees in first 11 years of term	8
Years in hotel management agreement term	11 years
Hotel management agreement default penalty factor of previous twelve months of management fees in twelfth year of term	4
Hotel management agreement default penalty factor of previous twelve months of management fees in thirteenth year of term	3
Hotel management agreement default penalty factor of previous twelve months of management fees in fourteenth year of term	2
Hotel management agreement default penalty factor of previous twelve months of management fees in fifteenth year of term	1
Outrigger Hotels | Maximum
Commitment And Contingencies [Line Items]
Property management fee (as a percent)	3.00%
Outrigger Hotels | Future Year Period One
Commitment And Contingencies [Line Items]
Years in hotel management agreement term	15 years
Outrigger Hotels | Future Year Period Two
Commitment And Contingencies [Line Items]
Years in hotel management agreement term	14 years
Outrigger Hotels | Future Year Period Three
Commitment And Contingencies [Line Items]
Years in hotel management agreement term	13 years
Outrigger Hotels | Future Year Period Four
Commitment And Contingencies [Line Items]
Years in hotel management agreement term	12 years
Wbw Hotel Lessee Llc
Commitment And Contingencies [Line Items]
Years of contract	20 years
Proportion of hotel occupancy gross revenue paid for program fee (as a percent)	4.00%
Wbw Hotel Lessee Llc | Future Time Period Prior to 12-31-2021
Commitment And Contingencies [Line Items]
Proportion of hotel occupancy gross revenue paid for franchise royalty fee (as a percent)	4.00%
Wbw Hotel Lessee Llc | Future Time Period After 12-31-2021
Commitment And Contingencies [Line Items]
Proportion of hotel occupancy gross revenue paid for franchise royalty fee (as a percent)	5.00%
Del Monte Center | Maximum
Commitment And Contingencies [Line Items]
Years, environmental remediation length	7 years
Del Monte Center | Minimum
Commitment And Contingencies [Line Items]
Years, environmental remediation length	5 years

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LEASES - Narrative (Details)	3 Months Ended
	Mar. 31, 2021
Lessor, Lease, Description [Line Items]
Years, minimum term range of office and retail leases	3 years
Years, maximum term range of office and retail leases	10 years
Months, minimum term of apartment leases	7 months
Months, maximum term of apartment leases	15 months
Operating leases rental period terms	12 months
Minimum
Lessor, Lease, Description [Line Items]
Lease extension option period	3 years
Lease extension options exercise period	6 months
Maximum
Lessor, Lease, Description [Line Items]
Lease extension option period	10 years
Lease extension options exercise period	12 months
Land Mark At One Market [Member]
Lessor, Lease, Description [Line Items]
Lease extension option exercise period	5 years

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LEASES - Minimum Future Rentals from Noncancelable Operating Leases (Details) $ in Thousands	Mar. 31, 2021 USD ($)
Leases [Abstract]
2021 (nine months ending December 31, 2021)	$ 162,655
2022	215,710
2023	199,077
2024	168,525
2025	147,434
Thereafter	443,310
Total	$ 1,336,711

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LEASES - Lease Obligations - Minimum Future Rental Payments from Operating Leases (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Leases [Abstract]
2021 (nine months ending December 31, 2021)	$ 2,350
2022	3,232
2023	3,328
2024	3,428
2025	3,531
Thereafter	19,710
Total lease payments	35,579
Imputed interest	(6,108)
Present value of lease liability	$ 29,471	$ 30,060

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LEASES - Lease Costs & Additional Lease Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Leases [Abstract]
Operating lease cost	$ 1,132	$ 844
Variable lease cost	0	0
Sublease income	(1,194)	(868)
Total lease (income) cost	$ (62)	$ (24)
Weighted-average remaining lease term - operating leases (in years)	10 years
Weighted-average discount rate - operating leases (as a percent)	3.21%

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LEASES - Supplemental Lease Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Operating cash flow information:
Cash paid for amounts included in the measurement of lease liabilities	$ 865	$ 846
Non-cash activity:
Right-of-use assets obtained in exchange for operating lease obligations	$ 0	$ 22,188

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COMPONENTS OF RENTAL INCOME AND EXPENSE - Component of Rental Income (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Rental Income [Line Items]
Percentage rent	$ 526	$ 301
Hotel revenue	3,271	8,125
Other	571	577
Total rental income	81,130	92,070
Recognition of straight-line rents	5,500	2,800
Recognition of amortization of above and below market leases	800	900
Office
Rental Income [Line Items]
Lease rental income	43,362	42,213
Retail
Rental Income [Line Items]
Lease rental income	20,853	24,955
Multifamily
Rental Income [Line Items]
Lease rental income	11,752	11,967
Mixed-use
Rental Income [Line Items]
Lease rental income	$ 795	$ 3,932

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COMPONENTS OF RENTAL INCOME AND EXPENSE (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Revenue Recognition and Deferred Revenue [Abstract]
Recognition of straight-line rents	$ 5.5	$ 2.8
Recognition of amortization of above and below market leases	$ 0.8	$ 0.9

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COMPONENTS OF RENTAL INCOME AND EXPENSE - Components of Rental Expenses (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Revenue Recognition and Deferred Revenue [Abstract]
Rental operating	$ 9,496	$ 9,882
Hotel operating	2,724	5,747
Repairs and maintenance	3,742	4,297
Marketing	393	507
Rent	1,152	853
Hawaii excise tax	532	865
Management fees	207	417
Total rental expenses	$ 18,246	$ 22,568

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OTHER (EXPENSE) INCOME, NET - Components of Other (Expense) Income (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Other Income and Expenses [Abstract]
Interest and investment income	$ 74	$ 312
Income tax expense	(127)	(206)
Other non-operating income	0	2
Total other (expense) income, net	$ (53)	$ 108

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RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2021	Mar. 01, 2019
Related Party Transaction [Line Items]
Rental income	$ 81,130	$ 92,070
Investment in WBW CHP LLC (as a percent)	47.70%
WBW CHP LLC
Related Party Transaction [Line Items]
Amount recovered for reimbursements of operating expense for related party	$ 300	300
American Assets, Inc. | Board of Directors Chairman
Related Party Transaction [Line Items]
Rental income	$ 100	$ 0
Lessor, Operating Lease, Term of Contract	10 years			3 years
American Assets, Inc. | Board of Directors Chairman | Scenario, Forecast
Related Party Transaction [Line Items]
Rental income			$ 200

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SEGMENT REPORTING (Details)	3 Months Ended
	Mar. 31, 2021 Segment Room
Segment Reporting [Abstract]
Number of operating segments | Segment	4
Room in mixed-use segment all-suite hotel | Room	369

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SEGMENT REPORTING - Operating Activity Within Reportable Segments (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Segment Reporting Information [Line Items]
Operating Income (Loss)	$ 20,062	$ 28,848
Total segments’ profit	54,386	63,130
Office
Segment Reporting Information [Line Items]
Revenue from Contract with Customer, Including Assessed Tax	44,464	44,509
Property Expenses	(11,364)	(11,793)
Operating Income (Loss)	33,100	32,716
Retail
Segment Reporting Information [Line Items]
Revenue from Contract with Customer, Including Assessed Tax	21,774	25,826
Property Expenses	(7,442)	(7,331)
Operating Income (Loss)	14,332	18,495
Multifamily
Segment Reporting Information [Line Items]
Revenue from Contract with Customer, Including Assessed Tax	12,552	12,825
Property Expenses	(5,491)	(5,510)
Operating Income (Loss)	7,061	7,315
Mixed-use
Segment Reporting Information [Line Items]
Revenue from Contract with Customer, Including Assessed Tax	5,196	13,583
Property Expenses	(5,303)	(8,979)
Operating Income (Loss)	$ (107)	$ 4,604

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SEGMENT REPORTING - Reconciliation of Segment Profit to Net Income Attributable to Stockholders (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Segment Reporting [Abstract]
Total segments’ profit	$ 54,386	$ 63,130
General and administrative	(6,823)	(6,820)
Depreciation and amortization	(27,501)	(27,462)
Interest expense	(14,005)	(13,472)
Early extinguishment of debt	(4,271)	0
Other (expense) income, net	(53)	108
NET INCOME	1,733	15,484
Net income attributable to restricted shares	(137)	(104)
Net income attributable to unitholders in the Operating Partnership	339	3,312
NET INCOME ATTRIBUTABLE TO AMERICAN ASSETS TRUST, INC. STOCKHOLDERS	$ 1,257	$ 12,068

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SEGMENT REPORTING - Net Real Estate and Secured Note Payable Balances (Details) - USD ($) $ in Thousands		Mar. 31, 2021	Dec. 31, 2020
Segment Reporting Information [Line Items]
Net Real Estate		$ 2,481,317	$ 2,492,734
Secured Notes Payable	[1]	111,000	111,000
Debt issuance costs, net of accumulated amortization of $1,324 and $0, respectively		746	0
American Assets Trust, L.P.
Segment Reporting Information [Line Items]
Net Real Estate		2,481,317	2,492,734
Secured notes payable, net | American Assets Trust, L.P.
Segment Reporting Information [Line Items]
Debt issuance costs, net of accumulated amortization of $1,324 and $0, respectively		66	77
Office
Segment Reporting Information [Line Items]
Net Real Estate		1,314,179	1,317,107
Secured Notes Payable	[1]	111,000	111,000
Retail
Segment Reporting Information [Line Items]
Net Real Estate		603,522	607,918
Multifamily
Segment Reporting Information [Line Items]
Net Real Estate		387,106	389,804
Mixed-use
Segment Reporting Information [Line Items]
Net Real Estate		$ 176,510	$ 177,905

[1] Excludes debt issuance costs of $0.1 million and $0.1 million for each of the periods ended March 31, 2021 and December 31, 2020, respectively.

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SEGMENT REPORTING - Capital Expenditures (Details) - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2021	Mar. 31, 2020
Segment Reporting Information [Line Items]
Capital expenditures	[1]	$ 12,216	$ 23,925
Office
Segment Reporting Information [Line Items]
Capital expenditures	[1]	9,527	18,200
Retail
Segment Reporting Information [Line Items]
Capital expenditures	[1]	1,722	3,558
Multifamily
Segment Reporting Information [Line Items]
Capital expenditures	[1]	963	1,284
Mixed-use
Segment Reporting Information [Line Items]
Capital expenditures	[1]	$ 4	$ 883

[1] Capital expenditures represent cash paid for capital expenditures during the period and include leasing commissions paid