Real Estate and Intangibles (Tables)

12 Months Ended

Dec. 31, 2017

Fair Values of Assets Acquired and Liabilities Assumed

Acquisitions

During the year ended December 31, 2017, we acquired four operating properties, OSHA – Sandy, VA – Loma Linda, FBI – Salt Lake, and VA – South Bend in asset acquisitions for an aggregate purchase price of $385.3 million, of which VA – Loma Linda comprised $212.6 million. During the year ended December 31, 2016, we acquired seven operating properties, ICE – Albuquerque, NPS – Omaha, DEA – Birmingham, FBI – Birmingham, EPA – Kansas City, FBI – Albany and AOC – South Bend for an aggregate purchase price of $156.9 million. We allocated the purchase prices of these acquisitions based on the estimated fair values of the acquired assets and assumed liabilities as follows (dollars in thousands):

	December 31, 2017			December 31, 2016
Real estate
Land	$	20,839		$	8,496
Building		319,698			127,430
Acquired tenant improvements		7,690			5,070
Total real estate		348,227			140,996
Intangible assets
In-place leases		30,458			18,742
Acquired leasing commissions		12,992			2,949
Total intangible assets		43,450			21,691
Intangible liabilities
Below-market leases		(6,357	)		(5,798	)
Total intangible liabilities		(6,357	)		(5,798	)
Purchase price	$	385,320		$	156,889

Proforma Financial Information of Future Operating Results

The pro forma information is not necessarily indicative of the results that actually would have occurred nor does it intend to indicate future operating results (dollars in thousands):

	For the years ended December 31,
Proforma (unaudited)	2016		2015
Total rental revenue		113,388		110,262
Net income (loss) ⁽¹⁾	$	7,838	$	7,511

Schedule of Real Estate and Intangibles

Real estate and intangibles on our consolidated balance sheets consisted of the following (dollars in thousands):

	December 31, 2017			December 31, 2016
Real estate properties, net
Land	$	134,163		$	112,162
Building		1,099,140			784,511
Acquired tenant improvements		47,503			39,936
Construction in progress		17,746			4,619
Accumulated amortization		(68,390	)		(39,806	)
Total Real estate properties, net	$	1,230,162		$	901,422
Intangible assets, net
In-place leases	$	160,119		$	122,661
Acquired leasing commissions		38,464			23,184
Above market leases		9,455			10,631
Accumulated amortization		(64,975	)		(41,603	)
Total Intangible assets, net	$	143,063		$	114,873
Intangible liabilities, net
Below market leases	$	(62,856	)	$	(56,498	)
Accumulated amortization		24,287			14,658
Total Intangible liabilities, net	$	(38,569	)	$	(41,840	)

Amortization of Total Intangible Assets and Intangible Liabilities

The net projected amortization of total intangible assets and intangible liabilities as of December 31, 2017 are as follows (dollars in thousands):

	Total
Intangible assets
2018	$	24,697
2019		19,540
2020		16,857
2021		12,638
2022		10,453
Thereafter		58,878
	$	143,063
Intangible liabilities
2018	$	(9,386	)
2019		(6,872	)
2020		(6,174	)
2021		(4,352	)
2022		(2,816	)
Thereafter		(8,969	)
	$	(38,569	)