REPORTABLE SEGMENTS

The Company has five reportable segments: Office, Retail, Land, Third Party Management and Leasing, and Other. In 2012, the Company sold its third party management and leasing business. See note 3 for detailed information. These reportable segments represent an aggregation of operating segments reported to the Chief Operating Decision Maker based on similar economic characteristics that include the type of product and the nature of service. Each segment includes both consolidated operations and joint ventures. The Office and Retail segments show the results for that product type. The Land segment includes results of operations for certain land holdings and single-family residential communities that are sold as developed lots to homebuilders. Fee income and related expenses for the third party-owned properties which are managed or leased by the Company are included in the Third Party Management and Leasing segment. The Other segment includes:


•	fee income for third party owned and joint venture properties for which the Company performs management, development, and leasing services;


•	compensation for corporate employees, other than those in the Third Party Management and Leasing segment;


•	general corporate overhead costs and interest expense for consolidated and unconsolidated entities;


•	income attributable to noncontrolling interests;


•	income taxes;


•	depreciation;


•	preferred dividends; and


•	operations of the industrial buildings, which were sold in 2011.

Company management evaluates the performance of its reportable segments in part based on funds from operations available to common stockholders (“FFO”). FFO is a supplemental operating performance measure used in the real estate industry. The Company calculated FFO using the National Association of Real Estate Investment Trusts’ (“NAREIT”) definition of FFO, which is net income (loss) available to common stockholders (computed in accordance with GAAP), excluding extraordinary items, cumulative effect of change in accounting principle, and gains on sale or impairment losses on depreciable property, plus depreciation and amortization of real estate assets, and after adjustments for unconsolidated partnerships and joint ventures to reflect FFO on the same basis.

FFO is used by industry analysts, investors, and the Company as a supplemental measure of a REIT’s operating performance. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, many industry investors and analysts have considered presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. Thus, NAREIT created FFO as a supplemental measure of a REIT’s operating performance that excludes historical cost depreciation, among other items, from GAAP net income. Management believes the use of FFO, combined with the required primary GAAP presentations, has been fundamentally beneficial, improving the understanding of operating results of REITs among the investing public and making comparisons of REIT operating results more meaningful. Company management evaluates operating performance in part based on FFO. Additionally, the Company uses FFO, along with other measures, to assess performance in connection with evaluating and granting incentive compensation to its officers and other key employees.

Segment net income, the balance of the Company’s investment in joint ventures and the amount of capital expenditures are not presented in the following tables. Management does not utilize these measures when analyzing its segments or when making resource allocation decisions and, therefore, this information is not provided. FFO is reconciled to net income (loss) on a total Company basis (in thousands):



Year ended December 31, 2013	Office		Retail		Land		Third Party Management and Leasing			Other			Total
Net operating income	$	122,503	$	13,278	$	—	$	—		$	2,299		$	138,080
Sales less costs of sales	—		—		1,273		—			191			1,464
Fee income	—		—		—		76			10,891			10,967
Other income	—		—		—		—			3,528			3,528
Gain on sale of third party management and leasing business	—		—		—		4,576			—			4,576
Third party management and leasing expenses	—		—		—		(97		)	—			(97		)
Separation expenses	—		—		—		—			(520		)	(520		)
General and administrative expenses	—		—		—		—			(21,940		)	(21,940		)
Reimbursed expenses	—		—		—		—			(5,215		)	(5,215		)
Interest expense	—		—		—		—			(29,672		)	(29,672		)
Other expenses	—		—		—		—			(11,373		)	(11,373		)
Preferred stock dividends and original issuance costs	—		—		—		—			(12,664		)	(12,664		)
Funds from operations available to common stockholders	$	122,503	$	13,278	$	1,273	$	4,555		$	(64,475	)	77,134
Real estate depreciation and amortization, including Company's share of joint ventures													(92,041		)
Gain on sale of depreciated investment properties, including Company's share of joint ventures													127,401
Non-controlling interest related to the sale of depreciated properties													(3,397		)
Net income available to common stockholders													$	109,097
Total Assets	$	2,163,123	$	18,112	$	47,235	$	—		$	44,736		$	2,273,206



Year ended December 31, 2012	Office		Retail		Land		Third Party Management and Leasing			Other			Total
Net operating income	$	80,907	$	29,429	$	—	$	—		$	121		$	110,457
Sales less costs of sales	—		—		4,915		—			309			5,224
Fee income	—		—		—		16,365			17,797			34,162
Other income	—		—		—		—			5,153			5,153
Gain on sale of third party management and leasing business	—		—		—		7,459			—			7,459
Third party management and leasing expenses	—		—		—		(13,675		)	—			(13,675		)
Separation expenses	—		—		—		—			(1,985		)	(1,985		)
General and administrative expenses	—		—		—		—			(23,208		)	(23,208		)
Reimbursed expenses	—		—		—		—			(7,063		)	(7,063		)
Interest expense	—		—		—		—			(28,154		)	(28,154		)
Impairment loss	—		—		—		—			(488		)	(488		)
Loss on extinguishment of debt	—		—		—		—			(94		)	(94		)
Other expenses	—		—		—		—			(8,389		)	(8,389		)
Preferred stock dividends	—		—		—		—			(12,907		)	(12,907		)
Funds from operations available to common stockholders	$	80,907	$	29,429	$	4,915	$	10,149		$	(58,908	)	66,492
Real estate depreciation and amortization, including Company's share of joint ventures													(62,043		)
Impairment losses on depreciable investment properties, net of amounts attributable to noncontrolling interests													(11,748		)
Gain on sale of depreciated investment properties including the Company's share of joint ventures													41,944
Other													(1,824		)
Net loss available to common stockholders													$	32,821
Total Assets	$	736,867	$	151,417	$	50,520	$	—		$	185,438		$	1,124,242



Year ended December 31, 2011	Office		Retail		Land		Third Party Management and Leasing			Other			Total
Net operating income	$	75,387	$	31,583	$	—	$	—		$	3,583		$	110,553
Sales less costs of sales	—		—		5,236		—			2,250			7,486
Fee income	—		—		—		19,359			13,821			33,180
Other income	—		—		—		—			2,204			2,204
Third party management and leasing expenses	—		—		—		(16,585		)	—			(16,585		)
Separation expenses	—		—		—		—			(197		)	(197		)
General and administrative expenses	—		—		—		—			(24,166		)	(24,166		)
Reimbursed expenses	—		—		—		—			(6,208		)	(6,208		)
Interest expense	—		—		—		—			(32,515		)	(32,515		)
Impairment losses	—		—		—		—			(129,134		)	(129,134		)
Loss on extinguishment of debt	—		—		—		—			(74		)	(74		)
Other expenses	—		—		—		—			(8,512		)	(8,512		)
Preferred stock dividends	—		—		—		—			(12,907		)	(12,907		)
Funds from operations available to common stockholders	$	75,387	$	31,583	$	5,236	$	2,774		$	(191,855	)	(76,875		)
Real estate depreciation and amortization, including Company's share of joint ventures													(62,710)
Impairment losses on depreciable investment properties, net of amounts attributable to noncontrolling interests													(7,632)
Gain on sale of depreciated investment properties, including Company's share of joint ventures													5,885
Net loss available to common stockholders													$	(141,332	)
Total Assets	$	732,857	$	375,923	$	108,172	$	4,302		$	14,281		$	1,235,535

When reviewing the results of operations for the Company, management analyzes the following revenue and income items net of their related costs:


•	Rental property operations;


•	Land sales; and


•	Gains on sales of investment properties.

These amounts are shown in the segment tables above in the same “net” manner as shown to management. In addition, management reviews the operations of discontinued operations and its share of the operations of its joint ventures in the same manner as the operations of its wholly-owned properties included in the continuing operations. Therefore, the information in the tables above includes the operations of discontinued operations and its share of joint ventures in the same categories as the operations of the properties included in continuing operations. Certain adjustments are required to reconcile the above segment information to the Company’s consolidated revenues. The following table reconciles information presented in the tables above to the Company’s consolidated revenues (in thousands):



	2013			2012			2011
Net operating income	$	138,080		$	110,457		$	110,553
Sales less cost of sales	1,464			5,224			7,486
Fee income	10,967			34,162			33,180
Other income	3,528			5,153			2,204
Rental property operating expenses	90,498			50,329			40,817
Cost of sales	1,753			1,833			5,378
Net operating income in joint ventures	(27,763		)	(23,596		)	(24,258		)
Sales less cost of sales in joint ventures	(111		)	(28		)	(1,927		)
Net operating income in discontinued operations	(6,390		)	(22,983		)	(32,410		)
Fee income in discontinued operations	(76		)	(16,364		)	(19,359		)
Other income in discontinued operations	(64		)	(3,622		)	(281		)
(Gain) loss on land sales (included in gain on investment properties)	(1,145		)	(3,719		)	(3,258		)
Total consolidated revenues	$	210,741		$	136,846		$	118,125