Revenue Recognition

3 Months Ended

Mar. 31, 2023

Revenue from Contract with Customer [Abstract]

REVENUE RECOGNITION

REVENUE RECOGNITION

The Company categorizes its primary sources of revenue into revenue from contracts with customers and other revenue accounted for as leases under ASC 842 as follows:

•Rental property revenues consist of (1) contractual revenues from leases recognized on a straight-line basis over the term of the respective lease; (2) percentage rents recognized once a specified sales target is achieved; (3) parking revenues; (4) termination fees; and (5) the reimbursement of the tenants' share of real estate taxes, insurance, and other operating expenses. The Company's leases typically include renewal options and are classified and accounted for as operating leases. Rental property revenues are accounted for in accordance with the guidance set forth in ASC 842.

•Fee income consists of development fees, management fees, and leasing fees earned from unconsolidated joint ventures and from third parties. Fee income is accounted for in accordance with the guidance set forth in ASC 606.

For the three months ended March 31, 2023, the Company recognized rental property revenues of $200.1 million, of which $59.1 million represented variable rental revenue. For the three months ended March 31, 2022, the Company recognized rental property revenues of $183.2 million, of which $52.8 million represented variable rental revenue.

For the three months ended March 31, 2023, the Company recognized fee and other revenue of $2.7 million. For the three months ended March 31, 2022, the Company recognized fee and other revenue of $3.7 million. The $3.7 million fee and other revenue includes $814,000 of income related to the Company's consulting and development contracts with Norfolk Southern Railway Company, as discussed in note 3 of the notes to consolidated financial statements in the Company's Annual Report on Form 10-K for the year ended December 31, 2022.

As disclosed in an 8-K filed on March 15, 2023, the Company has a lease with SVB Financial Group ("SVB Financial") at its Hayden Ferry property in Phoenix, Arizona. SVB Financial’s primary subsidiary, SVB Bank, was placed in receivership by the Federal Deposit Insurance Corporation ("FDIC") on March 10, 2023. On March 17, 2023, SVB Financial filed a voluntary petition for a court-supervised reorganization under Chapter 11 of the US Bankruptcy Code. On March 27, 2023, First Citizen's BancShares, Inc. ("FCB") announced that it had entered in to an agreement with the FDIC to purchase substantially all of the loans and certain other assets, and to assume all customer deposits and certain other liabilities of Silicon Valley Bridge Bank, N.A. FCB has also indicated that it intends to operate the SVB Bank locations as a division of FCB. SVB Financial is current on the financial obligations of its lease with Cousins through May 2023, and, to date, there has been no rejection of the lease under SVB Financial’s bankruptcy. This lease is projected to generate approximately $700,000 in straight-line revenue, inclusive of parking revenue and reimbursed operating expenses, per month through expiration in January 2026. If, at a date subsequent to the filing of these financial statements, collection under the terms of the lease no longer remains probable, the Company would reserve the net assets associated with the lease at that time. Net assets associated with the lease as of March 31, 2023 were $1.9 million.