OPERATING SEGMENTS

12 Months Ended

Dec. 31, 2014

OPERATING SEGMENTS

OPERATING SEGMENTS

NOTE 13.    OPERATING SEGMENTS

Our segments are based on management’s method of internal reporting which classifies its operations by property type. The segments are commercial, apartments, land and other. Significant differences among the accounting policies of the operating segments as compared to the Consolidated Financial Statements principally involve the calculation and allocation of administrative expenses. Management evaluates the performance of each of the operating segments and allocates resources to them based on their operating income and cash flow.

Items of income that are not reflected in the segments are interest, other income, gain on debt extinguishment, gain on condemnation award, equity in partnerships, and gains on sale of real estate. Expenses that are not reflected in the segments are provision for losses, advisory, net income and incentive fees, general and administrative, non-controlling interests and net loss from discontinued operations before gains on sale of real estate.

The segment labeled as “Other” consists of revenue and operating expenses related to the notes receivable and corporate debt.

Presented below is the Company’s reportable segments’ operating income including segment assets and expenditures for the years 2014, 2013 and 2012 (dollars in thousands):

For the Twelve Months Ended December 31, 2014	Properties			Apartments			Land			Other		Total
Rental and other property revenues	$	19,129		$	56,685		$	1		$	43	$	75,858
Property operating expenses		12,238			26,065			1,169			12		39,484
Depreciation		7,310			10,088			-			-		17,398
Mortgage and loan interest		5,625			14,794			4,092			3,857		28,368
Deferred borrowing costs amortization		74			1,527			226			682		2,509
Loan charges and prepayment penalties		113			2,625			16			50		2,804
Interest income		-			-			-			12,194		12,194
Gain on land sales		-			-			561			-		561
Segment operating income (loss)	$	(6,231	)	$	1,586		$	(4,941	)	$	7,636	$	(1,950	)
Capital expenditures		4,418			320			2,435			-		7,173
Assets		140,131			391,767			157,223			-		689,121
Property Sales
Sales price	$	19,182		$	115,273		$	8,091		$	-	$	142,546
Less: Cost of sale		9,168			63,408			7,530			-		80,106
Deferred current gain		-			-			-			-		-
Recognized prior deferred gain		-			-			-			-		-
Gain on sale	$	10,014		$	51,865		$	561		$	-	$	62,440
	Commercial
For the Twelve Months Ended December 31, 2013	Properties			Apartments			Land			Other		Total
Rental and other property revenues	$	22,928		$	54,272		$	39		$	112	$	77,351
Property operating expenses		10,857			24,798			976			38		36,669
Depreciation		5,846			9,996			-			-		15,842
Mortgage and loan interest		5,507			15,754			5,685			2,748		29,694
Deferred borrowing costs amortization		61			2,259			195			67		2,582
Loan charges and prepayment penalties		150			3,937			1,080			52		5,219
Interest income		-			-			-			13,790		13,790
Loss on land sales		-			-			(1,073	)		-		(1,073	)
Segment operating income (loss)	$	507		$	(2,472	)	$	(8,970	)	$	10,997	$	62
Capital expenditures		6,964			315			387			-		7,666
Assets		129,063			354,035			158,359			-		641,457
Property Sales
Sales price	$	26,974		$	239,676		$	5,999		$	-	$	272,649
Less: Cost of sale		14,914			154,331			7,072			-		176,317
Deferred current gain											-		-
Recognized prior deferred gain		-			-			-			-		-
Gain (loss) on sale	$	12,060		$	85,345		$	(1,073	)	$	-	$	96,332
	Commercial
For the Twelve Months Ended December 31, 2012	Properties			Apartments			Land			Other		Total
Rental and other property revenues	$	26,887		$	51,415		$	25		$	51	$	78,378
Property operating expenses		13,500			23,319			589			437		37,845
Depreciation		4,934			9,879			-			-		14,813
Mortgage and loan interest		5,394			18,499			6,250			4,229		34,372
Deferred borrowing costs amortization		86			394			154			-		634
Loan charges and prepayment penalties		-			3,495			79			-		3,574
Interest income		-			-			-			11,725		11,725
Gain on land sales		-			-			6,935					6,935
Segment operating income (loss)	$	2,973		$	(4,171	)	$	(112	)	$	7,110	$	5,800
Capital expenditures		1,831			(726	)		(920	)		-		185
Assets		136,774			363,677			173,132			-		673,583
Property Sales
Sales price	$	9,825		$	47,131		$	37,799		$	-	$	94,755
Less: Cost of sale		(10,152	)		(41,587	)		(31,479	)		-		(83,218	)
Deferred current gain		-			-			615			-		615
Recognized prior deferred gain		-			-			-			-		-
Gain (loss) on sale	$	(327	)	$	5,544		$	6,935		$	-	$	12,152

The table below reconciles the segment information to the corresponding amounts in the Consolidated Statements of Operations (dollars in thousands):

	For Twelve Months Ended December 31,
	2014			2013			2012
Segment operating income (loss)	$	(1,950	)	$	62		$	5,800
Other non-segment items of income (expense)
General and administrative		(7,163	)		(6,308	)		(5,074	)
Provision on impairment of notes receivable and real estate assets		-			(11,320	)		(2,330	)
Net income fee to related party		(3,669	)		(4,089	)		(180	)
Advisory fee to related party		(7,373	)		(8,494	)		(8,915	)
Other income		403			7,847			6,310
Gain (loss) on the sale of investments		(92	)		(283	)		125
Loss from unconsolidated joint ventures and investees		(28	)		(172	)		(66	)
Litigation settlement		3,591			(20,313	)		(175	)
Income tax benefit (expense)		20,390			40,949			(1,260	)
Gain (loss) from continuing operations	$	4,109		$	(2,121	)	$	(5,765	)

SEGMENT ASSET RECONCILIATION TO TOTAL ASSETS

The table below reconciles the segment information to the corresponding amounts in the Consolidated Balance Sheets (dollars in thousands):

	For the Years Ended December 31,
	2014		2013		2012
Segment assets	$	689,121	$	641,457	$	673,583
Investments in real estate partnerships		1,543		1,697		5,439
Notes and interest receivable		83,457		67,907		59,098
Other assets		156,284		132,265		83,857
Assets held for sale		-		54,345		223,367
Total assets	$	930,405	$	897,671	$	1,045,344