Investment in Real Estate

Real estate by property type and segment includes the following:



	December 31, 2015		December 31, 2014
Development property:
Residential real estate	$	99,413	$	102,408
Commercial real estate	56,587		59,405
Leasing operations ⁽¹⁾	360		3,680
Forestry	2,681		3,278
Corporate	2,211		2,019
Total development property	161,252		170,790

Operating property:
Residential real estate	$	8,091	$	8,084
Resorts and leisure	109,425		110,136
Leasing operations ⁽²⁾	79,550		72,045
Forestry	19,300		18,839
Other	50		50
Total operating property	216,416		209,154
Less: Accumulated depreciation	64,069		58,132
Net operating property	152,347		151,022

Investment in real estate, net	$	313,599	$	321,812



(1	)	Includes $0.3 million and $3.1 million for the Pier Park North joint venture as of December 31, 2015 and 2014, respectively.
(2	)	Includes $49.0 million and $41.6 million for the Pier Park North joint venture as of December 31, 2015 and 2014, respectively.

Development property consists of land the Company is developing or intends to develop for sale or future operations. Residential real estate includes mixed-use resort, primary and seasonal residential communities and includes costs directly associated with the land, development and construction of these communities, including common development costs such as roads, sewers, and amenities and indirect costs such as development overhead, capitalized interest, marketing and project administration. Commercial real estate includes land for commercial and industrial uses, including land holdings near the Northwest Florida Beaches International Airport and Port of Port St. Joe, and includes costs directly associated with the land and development costs for these properties, which also include common development costs such as roads and sewers. Leasing development property primarily includes the land and construction under development for the consolidated joint venture at Pier Park North. This development property is being reclassified as operating property as tenants commence operations at Pier Park North.

Operating property includes the following components:



	December 31, 2015		December 31, 2014		Estimated Useful Life (in years)
Land and land improvements	$	73,161	$	72,286	5 - 20
Buildings and building improvements	133,399		127,577		20 - 40
Timber	9,856		9,291		N/A
	216,416		209,154
Less: Accumulated depreciation	64,069		58,132
Total operating property, net	$	152,347	$	151,022

Operating property includes property that the Company uses for operations and activities. The resorts and leisure operating property includes the WaterColor Inn, golf courses and marinas. Leasing operating property includes property developed or purchased by the Company and used for retail and commercial rental purposes, including property in our consolidated joint venture at Pier Park North. Operating property may be sold in the future as part of the Company’s principal real estate business. Forestry operating property includes the Company’s timberlands.

Depreciation expense related to real estate investments was $6.3 million, $5.7 million, and $5.3 million in 2015, 2014 and 2013, respectively. Depletion expense related to our timber operations was $0.4 million, $0.5 million, and $1.2 million in 2015, 2014 and 2013, respectively.