Segment Reporting

9 Months Ended

Sep. 30, 2015

Segment Reporting [Abstract]

Segment Reporting

Segment Reporting

The Company operates in two segments, REI and Cole Capital, as further discussed below.

REI – Through its REI segment, the Company owns and actively manages a diversified portfolio of retail, restaurant, office and industrial real estate assets subject to long-term net leases with high credit quality tenants. As of September 30, 2015, the Company owned 4,572 properties comprising 100.9 million square feet of retail and commercial space located in 49 states, the District of Columbia, Puerto Rico and Canada, which includes properties owned through consolidated joint ventures. The rentable space at these properties was 98.3% leased with a weighted-average remaining lease term of 11.1 years. In addition, as of September 30, 2015, the Company owned 10 commercial mortgage-backed securities (“CMBS”) and 11 loans held for investment.

Cole Capital – Cole Capital is contractually responsible for managing the day-to-day affairs of Cole Credit Property Trust IV, Inc. (“CCPT IV”), Cole Real Estate Income Strategy (Daily NAV), Inc. (“INAV”), Cole Office & Industrial REIT (CCIT II), Inc. (“CCIT II”) and Cole Credit Property Trust V, Inc. (“CCPT V,” and collectively with CCPT IV, INAV and CCIT II, the “Managed REITs”), raising capital for those Managed REITs still in offering, identifying and making acquisitions and investments on the Managed REITs’ behalf and recommending to the respective board of directors of each of the Managed REITs an approach for providing investors with liquidity. Prior to its merger with Select Income REIT on January 29, 2015, Cole Corporate Income Trust, Inc. (“CCIT”), was also managed by Cole Capital. Cole Capital serves as the dealer manager and distributes shares of common stock for certain Managed REITs and advises them regarding offerings, manages relationships with participating broker-dealers and financial advisors and provides assistance in connection with compliance matters relating to the offerings. Cole Capital receives compensation and reimbursement for services relating to the Managed REITs’ offerings and the investment, management, financing and disposition of their respective assets, as applicable. Cole Capital also develops new REIT offerings and assists in obtaining regulatory approvals from the SEC, the Financial Industry Regulatory Authority, Inc. and various blue sky jurisdictions for such offerings.

The Company allocates certain operating expenses, such as legal fees, employee related costs and benefits and general overhead expenses between its operating segments. The following tables present a summary of the comparative financial results and total assets for each business segment (in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
REI segment:
Revenues:
Rental income	$	333,766		$	365,712		$	1,017,708		$	924,646
Direct financing lease income	659			625			2,097			2,812
Operating expense reimbursements	22,983			30,984			71,269			81,716
Total real estate investment revenues	357,408			397,321			1,091,074			1,009,174
Operating expenses:
Acquisition related	1,690			13,998			4,976			34,616
Merger and other non-routine transactions	8,957			7,613			42,244			173,406
Property operating	31,950			40,977			95,547			110,018
Management fees to affiliates	—			—			—			13,888
General and administrative	15,848			12,948			48,045			62,675
Depreciation and amortization	200,158			240,073			620,068			625,521
Impairment of real estate	—			2,299			85,341			3,855
Total operating expenses	258,603			317,908			896,221			1,023,979
Operating income (loss)	98,805			79,413			194,853			(14,805		)
Other (expense) income:
Interest expense, net	(89,530		)	(101,643		)	(275,801		)	(326,491		)
Extinguishment and forgiveness of debt, net	—			(5,396		)	5,302			(21,264		)
Other income, net	2,936			8,508			10,715			16,799
Gain on disposition of interest in joint venture	6,729			—			6,729			—
Loss on derivative instruments, net	(1,420		)	(17,484		)	(2,137		)	(10,398		)
Gain on sale of investments	—			6,357			—			6,357
Total other expenses, net	(81,285		)	(109,658		)	(255,192		)	(334,997		)
Income (loss) before income and franchise taxes and disposition of real estate and held for sale assets	17,520			(30,245		)	(60,339		)	(349,802		)
Loss on disposition of real estate and held for sale assets, net	(6,542		)	(256,894		)	(62,584		)	(275,768		)
Income (loss) before income and franchise taxes	10,978			(287,139		)	(122,923		)	(625,570		)
Provision for income and franchise taxes	(2,238		)	(1,994		)	(7,211		)	(5,905		)
Net income (loss)	$	8,740		$	(289,133	)	$	(130,134	)	$	(631,475	)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Cole Capital segment:
Revenues:
Offering-related fees and reimbursements	$	5,850		$	21,535		$	14,483		$	73,957
Transaction service fees and reimbursements	7,400			24,423			24,696			44,406
Management fees and reimbursements	14,296			13,839			42,390			32,913
Total Cole Capital revenues	27,546			59,797			81,569			151,276
Operating expenses:
Cole Capital reallowed fees and commissions	3,896			15,398			9,637			56,902
Acquisition related	74			—			533			—
Merger and other non-routine transactions	—			19			—			1,946
General and administrative	16,994			17,265			51,861			60,131
Depreciation and amortization	8,384			25,077			25,128			64,210
Total operating expenses	29,348			57,759			87,159			183,189
Operating (loss) income	(1,802		)	2,038			(5,590		)	(31,913		)
Total other income, net	465			179			2,076			305
(Loss) income before income taxes	(1,337		)	2,217			(3,514		)	(31,608		)
Benefit from (provision for) income taxes	738			(1,131		)	2,387			12,598
Net (loss) income	$	(599	)	$	1,086		$	(1,127	)	$	(19,010	)
Total Company:
Total revenues	$	384,954		$	457,118		$	1,172,643		$	1,160,450
Total operating expenses	$	287,951		$	375,667		$	983,380		$	1,207,168
Total other expense, net	$	(80,820	)	$	(109,479	)	$	(253,116	)	$	(334,692	)
Net income (loss)	$	8,141		$	(288,047	)	$	(131,261	)	$	(650,485	)

	Total Assets
	September 30, 2015		December 31, 2014
REI segment	$	18,008,818	$	19,771,138
Cole Capital	696,070		744,001
Total Company	$	18,704,888	$	20,515,139