Investment in Unconsolidated Joint Ventures

9 Months Ended

Sep. 30, 2015

Equity Method Investments and Joint Ventures [Abstract]

Investment in Unconsolidated Joint Ventures

Investment in Unconsolidated Joint Ventures

In addition to the 35 office and parking properties included in the consolidated financial statements, the Company was also invested in two unconsolidated joint ventures with unrelated investors as of September 30, 2015. Accordingly, the assets and liabilities of the joint ventures are not included on the Company's consolidated balance sheets at September 30, 2015 and December 31, 2014. Information relating to these unconsolidated joint ventures is summarized below (dollars in thousands):

Joint Venture Entity	Location	Parkway's Ownership%	Number of Properties	Investment Balance at September 30, 2015		Investment Balance at December 31, 2014
US Airways Building Tenancy in Common ("US Airways Building")	Phoenix, AZ	74.58%	1	$	38,801	$	39,760
7000 Central Park JV LLC ("7000 Central Park")	Atlanta, GA	40.00%	1	14,770		15,790
			2	$	53,571	$	55,550

The following table summarizes the balance sheets of the unconsolidated joint ventures at September 30, 2015 (in thousands):

	US Airways Building		7000 Central Park (1)		Total
Cash	$	144	$	166	$	310
Restricted cash	—		397		397
Real estate, net	46,473		49,040		95,513
Intangible assets, net	2,333		1,291		3,624
Receivables and other assets	3,454		4,916		8,370
Total assets	$	52,404	$	55,810	$	108,214
Mortgage debt	$	13,189	$	33,000	$	46,189
Other liabilities	382		1,554		1,936
Partners' equity	38,833		21,256		60,089
Total liabilities and partners' equity	$	52,404	$	55,810	$	108,214

(1) The joint venture reached an agreement to sell 7000 Central Park on August 26, 2015.

The following table summarizes the balance sheets of the unconsolidated joint ventures at December 31, 2014 (in thousands):

	US Airways Building		7000 Central Park (1)		Total
Cash	$	146	$	1,218	$	1,364
Restricted cash	—		269		269
Real estate, net	47,632		48,532		96,164
Intangible assets, net	2,537		2,695		5,232
Receivables and other assets	3,365		3,561		6,926
Total assets	$	53,680	$	56,275	$	109,955
Mortgage debt	$	13,441	$	30,000	$	43,441
Other liabilities	370		1,561		1,931
Partners' equity	39,869		24,714		64,583
Total liabilities and partners' equity	$	53,680	$	56,275	$	109,955

(1) The joint venture reached an agreement to sell 7000 Central Park on August 26, 2015.

The following table summarizes the statements of operations of the unconsolidated joint ventures for the three months ended September 30, 2015 (in thousands):

	US Airways Building		7000 Central Park (1)			Austin Joint Venture (2)		Total
Revenues	$	1,126	$	2,116		$	—	$	3,242
Operating expenses	3		947			—		950
Depreciation and amortization	522		922			—		1,444
Operating income before interest	601		247			—		848
Interest expense	101		169			—		270
Loan cost amortization	—		624			—		624
Net income (loss)	$	500	$	(546	)	$	—	$	(46	)

(1) The joint venture reached an agreement to sell 7000 Central Park on August 26, 2015.

(2) The Company previously owned an indirect interest in PKY/CalSTRS Austin, LLC (the "Austin Joint Venture"), a joint venture with the California State Teachers' Retirement System ("CalSTRS"). The Company terminated the Austin Joint Venture on November 17, 2014.

The following table summarizes the statements of operations of the unconsolidated joint ventures for the nine months ended September 30, 2015 (in thousands):

	US Airways Building		7000 Central Park (1)			Austin Joint Venture (2)		Total
Revenues	$	3,378	$	5,998		$	—	$	9,376
Operating expenses	3		2,930			—		2,933
Depreciation and amortization	1,566		3,692			—		5,258
Operating income (loss) before interest	1,809		(624		)	—		1,185
Interest expense	304		467			—		771
Loan cost amortization	—		708			—		708
Net income (loss)	$	1,505	$	(1,799	)	$	—	$	(294	)

(1) The joint venture reached an agreement to sell 7000 Central Park on August 26, 2015.

(2) The Company previously owned an indirect interest in the Austin Joint Venture. The Company terminated the Austin Joint Venture on November 17, 2014.

The following table summarizes the statements of operations of the unconsolidated joint ventures for the three months ended September 30, 2014 (in thousands):

	US Airways Building		7000 Central Park (1)			Austin Joint Venture (2)			Total
Revenues	$	1,126	$	1,803		$	25,863		$	28,792
Operating expenses	—		944			10,912			11,856
Depreciation and amortization	522		1,023			9,056			10,601
Operating income (loss) before interest	604		(164		)	5,895			6,335
Interest expense	105		150			9,665			9,920
Loan cost amortization	—		35			(161		)	(126		)
Net income (loss)	$	499	$	(349	)	$	(3,609	)	$	(3,459	)

(1) The joint venture reached an agreement to sell 7000 Central Park on August 26, 2015.

(2) The Company previously owned an indirect interest in the Austin Joint Venture. The Company terminated the Austin Joint Venture on November 17, 2014.

The following table summarizes the statements of operations of the unconsolidated joint ventures for the nine months ended September 30, 2014 (in thousands):

	US Airways Building		7000 Central Park (1)			Austin Joint Venture (2)			Total
Revenues	$	3,378	$	5,572		$	74,441		$	83,391
Operating expenses	—		2,817			30,576			33,393
Depreciation and amortization	1,566		3,316			28,220			33,102
Operating income (loss) before interest	1,812		(561		)	15,645			16,896
Interest expense	312		213			28,729			29,254
Loan cost amortization	—		141			(483		)	(342		)
Other expenses	—		—			1			1
Net income (loss)	$	1,500	$	(915	)	$	(12,602	)	$	(12,017	)

(1) The joint venture reached an agreement to sell 7000 Central Park on August 26, 2015.

(2) The Company previously owned an indirect interest in the Austin Joint Venture. The Company terminated the Austin Joint Venture on November 17, 2014.

On December 19, 2013, the Company acquired Thomas Properties Group, Inc.'s ("TPGI") interest in the Austin Joint Venture in connection with the merger transactions (the "Mergers") with TPGI. The Company and Madison International Realty ("Madison") owned a 50% interest in the joint venture with CalSTRS, of which the Company's ownership interest was 33%. On January 24, 2014, pursuant to a put right held by Madison, the Company purchased Madison’s approximately 17% interest in the Austin Joint Venture for a purchase price of approximately $41.5 million. On February 10, 2014, pursuant to an agreement entered into between CalSTRS and the Company, CalSTRS exercised an option to purchase 60% of Madison's former interest on the same terms as the Company for approximately $24.9 million. After giving effect to these transactions, the Company had a 40% interest in the CalSTRS joint venture and the Austin properties, with CalSTRS owning the remaining 60% and the Company recorded a gain on sale of real estate of approximately $6.3 million during the nine months ended September 30, 2014.

For a discussion of the Company's agreement to sell its ownership interest in 7000 Central Park, see "Note 13 — Subsequent Events."