Real Estate

12 Months Ended

Dec. 31, 2023

In September 2023, the Company sold a 10.4 acre land parcel in Atlanta for a gross sales price of $4.25 million and recorded a gain of $507,000.

During 2021, the Company sold three office properties. The following table summarizes these transactions ($ in thousands):


Property	Location	Date	Square Feet	Sales Price		Gain on Sale, Net
816 Congress	Austin	December 2021	435,000	$	174,000	$	77,200
One South at the Plaza	Charlotte	July 2021	891,000	$	271,500	$	12,700
Burnett Plaza	Fort Worth	April 2021	1,000,000	$	137,500	$	200

The Company sold the properties noted above as part of its ongoing investment strategy, using these proceeds to fund new investment activity. The Company recorded a total gain of $90.1 million from the 2021 sales.

In July 2021, the Company sold 0.7 acres of land in Phoenix, adjacent to its 100 Mill development, to a hotel developer for $6.4 million. Net proceeds approximated book value.

Impairment

The Company tests buildings held-for-investment, by disposal groups, for impairment whenever changes in circumstances indicate a disposal group’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 held-for-investment buildings were impaired during any periods presented in the accompanying statement of operations.

The Company also reviews held-for-sale buildings, if any, for impairments. In order to be considered a real estate asset held-for-sale, the Company must, among other things, have the authority to commit to a plan to sell the asset in its current condition, have commenced the plan to sell the asset, and have determined that it is probable that the asset will sell within one year. If book value is in excess of estimated fair value less estimated selling costs, the Company impairs those assets to fair value less estimated selling costs. There were no held-for-sale buildings as of December 31, 2023 or December 31, 2022 and no impairments of held-for-sale buildings during any periods presented in the accompanying statement of operations.

The Company also reviews land and projects under development for impairment whenever changes in circumstances indicate the assets' carrying value may not be recoverable. None of the Company's investments in land, including any accumulated predevelopment costs, or projects under development were impaired as of December 31, 2023 or December 31, 2022.

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