Acquisitions and Dispositions

6 Months Ended

Jun. 30, 2012

Business Combinations [Abstract]

Acquisitions and Dispositions

Acquisitions and Dispositions

2012 Acquisitions

We acquired eleven operating properties during the six months ended June 30, 2012. These acquisitions consisted of two industrial properties near Chicago, Illinois, two industrial properties in Columbus, Ohio, one industrial property in Southern California, one industrial property in Atlanta, Georgia and five medical office properties near Cincinnati, Ohio. The following table summarizes our allocation of the fair value of amounts recognized for each major class of asset and liability (in thousands) for these acquisitions:

Real estate assets	$	223,672
Lease related intangible assets	29,564
Other assets	2,829
Total acquired assets	256,065
Secured debt	18,741
Other liabilities	1,323
Total assumed liabilities	20,064
Fair value of acquired net assets	$	236,001

The leases in the acquired properties had a weighted average remaining life at acquisition of approximately 8.4 years.

Fair Value Measurements

The fair value estimates used in allocating the aggregate purchase price of each acquisition among the individual components of real estate assets and liabilities were determined primarily through calculating the “as-if vacant” value of each building, using the income approach, and relied significantly upon internally determined assumptions. We have determined these estimates to have been primarily based upon Level 3 inputs, which are unobservable inputs based on our own assumptions. The range of most significant assumptions utilized in making the lease-up and future disposition estimates used in calculating the “as-if vacant” value of each building acquired during the six months ended June 30, 2012 were as follows:

	Low		High
Discount rate	7.19	%	8.78	%
Exit capitalization rate	5.75	%	7.40	%
Lease-up period (months)	9		19
Net rental rate per square foot – Industrial	$2.75		$7.62
Net rental rate per square foot – Medical Office	$16.00		$26.14

Acquisition-Related Activity

The acquisition-related activity in our consolidated Statements of Operations for the six months ended June 30, 2012 and 2011 consists of transaction costs related to completed acquisitions, which are expensed as incurred.

Dispositions

We disposed of income-producing real estate assets and undeveloped land and received net cash proceeds of $89.5 million and $498.2 million during the six months ended June 30, 2012 and 2011, respectively.