XML 75 R43.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Share-Based Payments (Tables)
 12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]    
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award [Table Text Block] The following is a summary of the significant assumptions used to value both the Performance-Based LTIP and Special Performance-Based LTIP Units:
 
Year Ended December 31,
 
2019
 
2018
 
2017
 
 
Expected volatility
19.0% to 23.0%
 
19.9% to 26.0%
 
18.0
%
Dividend yield
2.3% to 2.5%
 
2.5% to 2.7%
 
2.3
%
Risk-free interest rate
2.3% to 2.6%
 
2.3% to 3.0%
 
1.5
%

The following is a summary of both the Performance-Based LTIP and Special Performance-Based LTIP Units activity:
 
Unvested Shares
 
Weighted Average Grant-Date Fair Value
Unvested at December 31, 2018
1,657,578

 
$
18.27

Granted
478,411

 
19.49

Forfeited
(18,054
)
 
18.00

Unvested at December 31, 2019
2,117,935

 
18.55



The following is a summary of the significant assumptions used to value the Formation Awards:
 
Year Ended December 31,
 
2018
 
2017
Expected volatility
27.0% to 29.0%
 
26.0
%
Dividend yield
2.5% to 2.7%
 
2.3
%
Risk-free interest rate
2.8% to 3.0%
 
2.3
%
Expected life
7 years
 
7 years

The following is a summary of the Formation Awards activity:
 
Unvested Shares
 
Weighted Average Grant-Date Fair Value
Unvested at December 31, 2018
2,655,394

 
$
8.81

Vested
(160,746
)
 
8.84

Forfeited
(9,702
)
 
8.55

Unvested at December 31, 2019
2,484,946

 
8.81


The following is a summary of the significant assumptions used to value the Granted LTIPs:

 
Year Ended December 31,
 
2019
 
2018
 
2017
 
 
Expected volatility
18.0% to 24.0%
 
20.0% to 22.0%
 
17.0% to 19.0%
Risk-free interest rate
2.3% to 2.6%
 
1.9% to 2.6%
 
1.3% to 1.5%
Post-grant restriction periods
2 to 3 years
 
2 to 3 years
 
2 to 3 years
The following is a summary of the Granted LTIP activity:
 
Unvested Shares
 
Weighted Average Grant-Date Fair Value
Unvested at December 31, 2018
962,662

 
$
34.03

Granted
493,777

 
34.40

Vested
(360,703
)
 
33.15

Forfeited
(393
)
 
34.52

Unvested at December 31, 2019
1,095,343

 
34.35


The total-grant date fair value of the Granted LTIPs that vested for each of the three years in the period ended December 31, 2019 was $12.0 million, $3.6 million and $2.5 million. In 2020, we issued 471,598 LTIP Units to management and employees with an estimated aggregate grant-date fair value of $18.3 million.
The following is a summary of the OP Units activity:
 
Unvested Shares
 
Weighted Average Grant-Date Fair Value
Unvested at December 31, 2018
2,999,987

 
$
33.39

Vested
(127,735
)
 
33.39

Unvested at December 31, 2019
2,872,252

 
33.39
 
Year Ended December 31,
 
2019
 
2018
 
2017
 
 
Expected volatility
19.0% to 23.0%
 
19.9% to 26.0%
 
18.0
%
Dividend yield
2.3% to 2.5%
 
2.5% to 2.7%
 
2.3
%
Risk-free interest rate
2.3% to 2.6%
 
2.3% to 3.0%
 
1.5
%

The following is a summary of both the Performance-Based LTIP and Special Performance-Based LTIP Units activity:
 
Unvested Shares
 
Weighted Average Grant-Date Fair Value
Unvested at December 31, 2018
1,657,578

 
$
18.27

Granted
478,411

 
19.49

Forfeited
(18,054
)
 
18.00

Unvested at December 31, 2019
2,117,935

 
18.55



In 2020, we issued 593,100 Performance-Based LTIP Units to management and employees with an estimated aggregate grant-date fair value of $11.1 million.
JBG SMITH 2017 ESPP
The JBG SMITH 2017 ESPP authorized the issuance of up to 2.1 million common shares. The ESPP provides eligible employees an option to purchase, through payroll deductions, our common shares at a discount of 15.0% of the closing price of a common share on relevant determination dates, provided that the fair market value of common shares, determined as of the first day of the relevant offering period, purchased by any eligible employee may not exceed $25,000 in any calendar year. The maximum aggregate number of common shares reserved for issuance under the ESPP will automatically increase on January 1 of each year, unless the Compensation Committee of the Board of Trustees determines to limit any such increase, by the lesser of (i) 0.10% of the total number of outstanding common shares on December 31 of the preceding calendar year or (ii) 206,600 common shares.
Pursuant to the ESPP, employees purchased 47,022 and 20,178 common shares for $1.5 million and $597,000 during the years ended December 31, 2019 and 2018. The following is a summary of the significant assumptions used to value the ESPP common shares using the Black-Scholes model:
 
Year Ended December 31,
 
2019
 
2018
Expected volatility
18.0% to 28.0%
 
21.0
%
Dividend yield
2.6% to 3.5%
 
2.5
%
Risk-free interest rate
2.2% to 2.4%
 
2.0
%
Expected life
6 months
 
6 months


As of December 31, 2019, there were 2.0 million common shares available for issuance under the ESPP.
Summary of Share-Based Compensation Expense
The following is a summary of share-based compensation expense:
 
Year Ended December 31,
 
2019
 
2018
 
2017
 
(In thousands)
Time-Based LTIP Units
$
11,386

 
$
10,095

 
$
2,211

Performance-Based LTIP Units
8,716

 
5,271

 
1,172

LTIP Units
1,000

 
794

 
—

Other equity awards (1)
4,535

 
3,826

 
1,526

Share-based compensation expense - other 
25,637

 
19,986

 
4,909

Formation Awards
5,734

 
5,606

 
5,169

OP Units (2)
29,826

 
29,455

 
21,467

LTIP Units (2)
456

 
277

 
2,615

Special Performance-Based LTIP Units (3)
2,843

 
323

 
—

Special Time-Based LTIP Units (3)
3,303

 
369

 
—

Share-based compensation related to
   Formation Transaction and special equity
   awards (4)
42,162

 
36,030

 
29,251

Total share-based compensation expense
67,799

 
56,016

 
34,160

Less amount capitalized
(2,526
)
 
(3,341
)
 
(467
)
Share-based compensation expense
$
65,273

 
$
52,675

 
$
33,693


______________________________________________ 
(1) 
For the years ended December 31, 2019 and 2018, primarily includes compensation expense for certain executives who have elected to receive all or a portion of any cash bonus that may be paid in the subsequent year related to past service in the form of fully vested LTIP Units and related to our ESPP. For the year ended December 31, 2017, represents share-based compensation expense related to equity awards prior to the Formation Transaction.
(2) 
Represents share-based compensation expense for LTIP Units and OP Units subject to post-Combination employment obligations.
(3) 
Represents equity awards issued related to our successful pursuit of Amazon's additional headquarters in National Landing.
(4) 
Included in "General and administrative expense: Share-based compensation related to Formation Transaction and special equity awards" in the accompanying statements of operations.