Related Party Transactions and Arrangements (Tables)

12 Months Ended

Dec. 31, 2015

The following table summarizes the related party fees and expenses incurred by the Company, ARCT III and ARCT IV by category and the aggregate amounts contained in such categories for the periods presented (in thousands). During the year ended December 31, 2015, there were no material transactions with the Former Manager or any of the Former Manager’s affiliates.



	Year Ended December 31,
	2015		2014		2013
Expenses and capitalized costs:
Financing fees and reimbursements	$	—	$	—	$	14,277
Offering related costs	—		2,150		161,796
Acquisition related expenses	—		1,652		37,564
Merger and other non-routine transaction related expenses	—		137,778		156,146
Management fees to affiliates	—		13,888		17,462
General and administrative expenses	—		16,089		103,206
Indirect affiliate expenses	—		10,975		68
Total expenses and capitalized costs	$	—	$	182,532	$	490,519

Offering Related Revenue [Member]

Schedule of Related Party Transactions

recorded commissions, fees and offering cost reimbursements for services provided to the Company, ARCT III and ARCT IV, as applicable, by affiliates of the Former Manager during the periods indicated (in thousands):



	Year Ended December 31,
	2015		2014		2013
Offering related costs
Commissions and fees	$	—	$	—	$	148,232
Offering costs and other reimbursements	—		2,150		13,564
Total offering related costs	$	—	$	2,150	$	161,796

The following table shows the offering fee summary information for the Managed REITs as of December 31, 2015:



Program	Selling Commissions ⁽¹⁾	Dealer Manager and Distribution Fees ⁽²⁾
Open Programs
CCPT V	7%	2%
INAV ⁽³⁾
Wrap Class Shares	—%	0.55%
Advisor Class Shares	up to 3.75%	0.55% and 0.50%
Institutional Class Shares	—%	0.25%

CCIT II	7%	2%

Closed Programs
CCPT IV ⁽⁴⁾	7%	2%

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(1)	The Company reallows 100% of selling commissions earned to participating broker-dealers.


(2)	The Company may reallow all or a portion of its dealer manager fee or applicable distribution fee to participating broker-dealers as a marketing and due diligence expense reimbursement.


(3)	In connection with the INAV offering, the Company receives selling commissions, an asset-based dealer manager fee and/or an asset-based distribution fee, all based on the net asset value for each class of common stock.


(4)	CCPT IV’s offering closed April 4, 2014.

Merger and other non-routine transactions [Member]

Schedule of Related Party Transactions

No related party transactions classified as merger and other non-routine transactions in the accompanying consolidated statements of operations were incurred during the year ended December 31, 2015.



	Year Ended December 31, 2014
	ARCT IV Merger		Internalization and Other		Cole Merger		Multi-tenant Spin Off		Total
Merger related costs:
Strategic advisory services	$	8,400	$	—	$	17,115	$	1,750	$	27,265
Personnel costs and other reimbursements	—		—		72		—		72
Other non-routine transaction related expenses:
Subordinated distribution fees	78,244		—		—		—		78,244
Furniture, fixtures and equipment	5,800		10,000		—		—		15,800
Other fees and expenses	—		—		2,900		—		2,900
Personnel costs and other reimbursements	417		—		1,728		—		2,145
Post-transaction support services	1,352		10,000		—		—		11,352
Total merger and other non-routine transaction related expenses	$	94,213	$	20,000	$	21,815	$	1,750	$	137,778

	Year Ended December 31, 2013
	ARCT III Merger		ARCT IV Merger		CapLease Merger		Cole Merger		Other		Total
Merger related costs:
Strategic advisory services	$	—	$	16,075	$	5,563	$	14,215	$	243	$	36,096
Legal fees and expenses	126		500		3,000		—		40		3,666
Personnel costs and other reimbursements	522		2,137		567		169		178		3,573
Other fees and expenses	—		640		250		—		—		890
Other non-routine transaction related expenses:
Subordinated distribution fee	98,360		—		—		—		—		98,360
Furniture, fixtures and equipment	5,800		—		—		—		—		5,800
Legal fees and expenses	950		—		—		—		—		950
Personnel costs and other reimbursements	—		1,107		—		1,463		109		2,679
Post-transaction support services	2,000		2,000		—		—		—		4,000
Other fees and expenses	—		—		132		—		—		132
Total merger and other non-routine transaction related expenses	$	107,758	$	22,459	$	9,512	$	15,847	$	570	$	156,146

Management Fees To Affiliates [Member]

Schedule of Related Party Transactions

No such fees were incurred during the year ended December 31, 2015.



	Year Ended December 31,
	2015		2014		2013
Management fees to affiliates:
Base management fees	$	—	$	—	$	4,969
Asset management fees	—		13,888		11,693
Property management fees	—		—		800
Total management fees to affiliates	$	—	$	13,888	$	17,462

General and Administrative Expense [Member]

Schedule of Related Party Transactions

recorded general and administrative expenses as shown in the table below for services provided by the Former Manager and its affiliates related to the operations of the Company, ARCT III and ARCT IV during the periods indicated (in thousands):



	Year Ended December 31,
	2015		2014		2013
General and administrative expenses:
Advisory fees and reimbursements	$	—	$	2,015	$	5,602
Equity awards	—		14,074		97,604
Total general and administrative expenses	$	—	$	16,089	$	103,206

Indirect Affiliate Expenses [Member]

Schedule of Related Party Transactions

These expenses are depicted in the table below for the periods indicated (in thousands):



	Year Ended December 31,
	2015		2014		2013
Indirect affiliate expenses:
Audrain building	$	—	$	8,724	68
ANST office build-out	—		462		—
New York (405 Park Ave.) office	—		1,659		—
Dresher, PA office	—		92		—
North Carolina office	—		38		—
Total indirect affiliate expenses	$	—	$	10,975	$	68

Transaction Related Fees [Member]

Schedule of Related Party Transactions

The following table shows the transaction-related fees for the Managed REITs and other real estate programs as of December 31, 2015:



Program	Acquisition Transactional Fees ⁽¹⁾	Disposition Fees	Liquidation Performance Fees ⁽²⁾
Open Programs
CCPT V	2%	1%	15%
INAV	—	—	—
CCIT II	2%	1%	15%

Closed Programs
CCPT IV	2%	1%	15%
Other Programs	Various	Various	Various

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(1)	Percent taken on gross purchase price.

(2)

Performance fee paid only under the following circumstances: (i) if shares are listed on a national securities exchange; (ii) if the respective Managed REIT is sold or the assets are liquidated; or (iii) upon termination of the advisory agreement. In connection with such events, the performance fee will only be earned upon the return to investors of their net capital invested and an 8% annual cumulative, non-compounded return (6% in the case of CCPT V).

Management Service Revenue [Member]

Schedule of Related Party Transactions

The following table shows the management fees for the Managed REITs as of December 31, 2015:



Program	Asset Management / Advisory Fees ⁽¹⁾	Performance Fees ⁽²⁾
Open Programs
CCPT V	0.65% - 0.75%	—
INAV	0.90%	25%
CCIT II	0.65% - 0.75%	—

Closed Programs
CCPT IV	0.65% - 0.75%	—
Other Programs	Various	—

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(1)	Annualized fee based on the average monthly invested assets or net asset value, if available.


(2)	Performance fee paid for any year in which the total return on stockholders’ capital exceeds 6% per annum on a calendar year basis.

Revenue from Managed REITs [Member]

Schedule of Related Party Transactions

The table below reflects the revenue earned from the Managed REITs (including closed programs, as applicable) and joint ventures for the years ended December 31, 2015 and 2014 (in thousands). No such revenues were earned in 2013.



	Year Ended December 31,
	2015		2014
Offering-related fees and reimbursements
Securities commissions ⁽¹⁾	$	14,101	$	57,023
Dealer manager and distribution fees ⁽²⁾	5,131		17,533
Reimbursement revenue	5,178		12,553
Offering-related fees and reimbursements	24,410		87,109

Transaction service fees and reimbursements
Acquisition fees	18,742		60,426
Disposition fees ⁽³⁾	4,974		—
Reimbursement revenues	2,165		4,284
Transaction service fees and reimbursements	25,881		64,710

Management fees and reimbursements
Asset and property management fees and leasing fees	452		596
Advisory and performance fee revenue	44,948		40,906
Reimbursement revenues	13,843		8,806
Management fees and reimbursements	59,243		50,308

Interest income on Affiliate Lines of Credit	1,275		307

Total related party revenues⁽⁴⁾	$	110,809	$	202,434

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(1)	The Company reallows 100% of selling commissions earned to participating broker-dealers.


(2)	During the years ended December 31, 2015 and 2014, the Company reallowed $2.0 million and $9.2 million, respectively, of dealer manager fees to participating broker dealers as a marketing and due diligence expense reimbursement.


(3)	The Company earned a disposition fee of $4.4 million on behalf of CCIT when it merged with Select Income REIT on January 29, 2015 and a $0.6 million disposition fee in connection with the sale of one property owned by a consolidated joint venture.

(4) Total related party revenues excludes fees earned from 1031 real estate programs of $5.3 million and $1.4 million for the years ended December 31, 2015 and 2014, respectively.

Investments In Managed REITs [Member]

Schedule of Related Party Transactions

The table below presents certain information related to the Company’s investments in the Managed REITs as of December 31, 2015 (carrying amount in thousands):



	December 31, 2015
Managed REIT	% of Outstanding Shares Owned	Carrying Amount of Investment
CCPT IV	0.01%	$	122
CCPT V	1.27%	1,644
CCIT II	0.71%	1,544
INAV	0.14%	154
Funds not yet in offering	N/A	600
		$	4,064