Discontinued Operations (Tables)

9 Months Ended

Sep. 30, 2012

Disposition and properties held for sale

All current and prior period income from the following office property dispositions and properties held for sale is included in discontinued operations for the three months and nine months ended September 30, 2012 and 2011 (in thousands).

Office Property	Location	Square Feet		Date of Sale	Net Sales Price		Net Book Value of Real Estate		Gain (Loss) on Sale
233 North Michigan	Chicago, IL		1,070	05/11/2011	$	156,546	$	152,254	$	4,292
Greenbrier I & II	Hampton Roads, VA		172	07/19/2011		16,275		15,070		1,205
Glen Forest	Richmond, VA		81	08/16/2011		8,950		7,880		1,070
Tower at Gervais	Columbia, SC		298	09/08/2011		18,421		18,421		-
Wells Fargo	Houston, TX		134	12/09/2011		-		-		-
Fund I Assets	Various		1,956	12/31/2011		256,823		250,699		11,258
2011 Dispositions (2)			3,711		$	457,015	$	444,324	$	17,825

Falls Pointe	Atlanta, GA		107	01/06/2012	$	5,824	$	4,467	$	1,357
111 East Wacker	Chicago, IL		1,013	01/09/2012		153,240		153,237		3
Renaissance Center	Memphis, TN		189	03/01/2012		27,661		24,629		3,032
Overlook II	Atlanta, GA		260	04/30/2012		29,467		28,689		778
Wink Building	New Orleans, LA		32	06/08/2012		705		803		(98	)
Ashford/Peachtree	Atlanta, GA		321	07/01/2012		29,440		28,074		1,366
Non-Core Assets	Various		1,932	Various		125,486		122,157		3,329
2012 Dispositions (3)			3,854		$	371,823	$	362,056	$	9,767

Office Property	Location	Square Feet		Date of Sale	Gross Sales Price
Properties Held for Sale and Expected to Close During Fourth Quarter 2012 (1)
Sugar Grove	Houston, TX		124	10/23/2012	$	11,425
Total Properties Held for Sale			124		$	11,425

(1) Gains on assets held for sale are expected to be finalized upon sale and reflected in the year ending December 31, 2012 financial statements.

(2) Total gain on the sale of real estate in discontinued operations recognized for the year ended December 31, 2011 was $17.8 million, of which $9.8 million was Parkway's proportionate share.

(3) Total gain on the sale of real estate in discontinued operations recognized during the nine months ended September 30, 2012 was $9.8 million, of which $4.9 million was Parkway's proportionate share.

At September 30, 2012, assets and liabilities related to assets held for sale represented Sugar Grove, a 124,000 square foot office property in Houston, Texas. On October 23, 2012, the Company sold Sugar Grove for $11.4 million and received $10.0 million in net proceeds, which will be used to fund future acquisitions. Income from Sugar Grove has been classified as discontinued operations for all current and prior periods. The assets and liabilities associated with Sugar Grove which have been classified as held for sale at September 30, 2012 are as follows (in thousands):

	September 30 2012
Balance Sheet:
Investment property	$	11,743
Accumulated depreciation		(5,071	)
Office property held for sale		6,672
Rents receivable and other assets		359
Total assets held for sale	$	7,031

Accounts payable and other liabilities	$	361
Total liabilities related to assets held for sale	$	361

The amount of revenues and expenses for these office properties reported in discontinued operations for the three months and nine months ended September 30, 2012 and 2011 is as follows (in thousands):

	Three Months Ended September 30						Nine Months Ended September 30
	2012			2011			2012			2011
Statement of Operations:
Revenues
Income from office and parking properties	$	836		$	30,517		$	13,857		$	107,098
		836			30,517			13,857			107,098

Expenses
Office and parking properties:
Operating expense		543			13,359			6,450			47,907
Management company expense		53			76			291			202
Interest expense		468			7,023			3,845			22,792
Non-cash adjustment for interest rate swap		-			-			(215	)		-
Depreciation and amortization		102			14,852			948			46,061
Impairment loss		-			127,007			-			128,707
		1,166			162,317			11,319			245,669

Income (loss) from discontinued operations		(330	)		(131,800	)		2,538			(138,571	)
Gain on sale of real estate from discontinued operations		995			2,275			9,767			6,567
Total discontinued operations per Statement of Operations		665			(129,525	)		12,305			(132,004	)
Net (income) loss attributable to noncontrolling interest from discontinued operations		(545	)		74,310			(4,219	)		77,840
Total discontinued operations-Parkway's share	$	120		$	(55,215	)	$	8,086		$	(54,164	)

- Definition

Tabular disclosure of disposal groups, which may include the gain (loss) recognized in the income statement and the income statement caption that includes that gain (loss), amounts of revenues and pretax profit or loss reported in discontinued operations, the classification and carrying value of the assets and liabilities comprising the disposal group, and the segment in which the disposal group was reported. Also may include the amount of adjustments to amounts previously reported in discontinued operations such as resolution of contingencies arising from the disposal transaction or the operations of the component prior to disposal.

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