Real Estate

3 Months Ended

Mar. 31, 2021

Acquisitions

On March 12, 2021, the Company acquired a 0.24 acre land parcel in Atlanta for a gross purchase price of $8 million which is held in a 95% owned consolidated joint venture.

Dispositions

The Company had two dispositions of consolidated operating properties during the quarter ended March 31, 2020. The Company sold the following properties in 2020 ($ in thousands):

Property

Property Type

Location

Square Feet

Sales Price

Hearst Tower

Office

Charlotte, NC

966,000

455,500

Woodcrest

Office

Cherry Hill, NJ

386,000

25,300

The Company sold the properties noted above as part of its ongoing investment strategy, using the proceeds from the dispositions to fund new investment activity. The gain of $90.3 million from the sale of these properties is net of $380,000 of estimated state income tax.

The Company's Burnett Plaza property was classified as held for sale as of March 31, 2021 and December 31, 2020. The major classes of assets and liabilities of this property held for sale were as follows (in thousands):


	March 31, 2021		December 31, 2020
Real estate assets and other assets held for sale
Operating property, net of accumulated depreciation of $8,123 in 2021 and 2020	$	114,603	$	106,864
Notes and accounts receivable	696		439
Deferred rents receivable	2,742		2,480
Intangible assets, net of accumulated amortization of $5,912 and $6,065 in 2021 and 2020, respectively	15,978		15,830
Other assets	165		133
Total real estate assets and other assets held for sale	$	134,184	$	125,746

Liabilities of real estate assets held for sale
Accounts payable and accrued expenses	$	4,895	$	7,399
Deferred income	54		44
Intangible liabilities, net of accumulated amortization of $1,106 and $1,205 in 2021 and 2020, respectively	3,114		3,014
Other liabilities	2,381		2,149
Total liabilities of real estate assets held for sale	$	10,444	$	12,606

Subsequent to quarter end, on April 7, 2021, the Company sold Burnett Plaza for a gross purchase price of $137.5 million and recorded a gain of $364,000.

Impairment

The Company tests buildings held for investment for impairment whenever changes in circumstances indicate a building’s carrying value may not be recoverable. The test is conducted using undiscounted cash flows for the shorter of the building’s estimated hold period or its remaining useful life. When testing for recoverability of buildings held for investment, projected cash flows are used over its expected hold period. If the expected hold period includes some likelihood of shorter-term hold period from a potential sale, the probability of a sale is layered into the analysis. If any building's held for investment analysis were to fail the impairment test, its book value would be written down to its then current estimated fair value, before any selling expense, and that building would continue to depreciate over its remaining useful life. None of the Company’s buildings were impaired during any periods presented while under the held for investments classification.

The Company may record additional impairment charges in future periods if operating results of individual buildings are materially different from our forecasts, the economy and the office industry weakens, or we shorten our contemplated holding period for additional buildings