Discontinued Operations and Assets Held for Sale

6 Months Ended

Jun. 30, 2016

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations and Assets Held for Sale

Discontinued Operations, Assets Held-for-Sale and Impairments

Discontinued Operations

The following table illustrates the number of sold or held-for-sale properties included in, or excluded from, discontinued operations:

	Held-for-Sale at June 30, 2016	Sold Year-to-Date in 2016	Sold in 2015	Total
Industrial	0	0	5	5
Medical Office	0	0	1	1
Non-reportable Rental Operations	0	0	56	56
Total properties included in discontinued operations	0	0	62	62
Properties excluded from discontinued operations	1	9	91	101
Total properties sold or classified as held-for-sale	1	9	153	163

For the properties that were classified in discontinued operations, we allocated interest expense to discontinued operations and have included such interest expense in computing income from discontinued operations. Interest expense allocable to discontinued operations includes interest on any secured debt for properties included in discontinued operations and an allocable share of our consolidated unsecured interest expense for unencumbered properties. The allocation of unsecured interest expense to discontinued operations was based upon the gross book value of the unencumbered real estate assets included in discontinued operations as it related to the total gross book value of our unencumbered real estate assets. There were no additional properties classified as discontinued operations during the six months endedJune 30, 2016 and, as such, no interest expense was allocated to discontinued operations during that period.

The following table illustrates the operational results of the buildings reflected in discontinued operations for the three and six months endedJune 30, 2016 and 2015, respectively (in thousands):

	Three Months Ended June 30,					Six Months Ended June 30,
	2016		2015			2016		2015
Revenues	$	126	$	49		$	355	$	32,164
Operating expenses	1		(13		)	9		(12,399		)
Depreciation and amortization	—		—			—		(3,517		)
Operating income	127		36			364		16,248
Interest expense	—		—			—		(6,053		)
Income before gain on sales	127		36			364		10,195
Gain on sale of depreciable properties	252		399,354			166		417,729
Income from discontinued operations before income taxes	379		399,390			530		427,924
Income tax expense	—		(3,220		)	—		(3,220		)
Income from discontinued operations	$	379	$	396,170		$	530	$	424,704

We had no capital expenditures for the six months endedJune 30, 2016 and $7.4 million for the six months endedJune 30, 2015 related to properties classified within discontinued operations.

Allocation of Noncontrolling Interests - General Partner

The following table illustrates the General Partner's share of the income attributable to common shareholders from continuing operations and discontinued operations, reduced by the allocation of income between continuing and discontinued operations to the Limited Partner Units, for the three and six months endedJune 30, 2016 and 2015, respectively (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2016		2015		2016		2015
Income from continuing operations attributable to common shareholders	$	108,692	$	57,333	$	151,850	$	94,382
Income from discontinued operations attributable to common shareholders	375		392,047		524		420,242
Net income attributable to common shareholders	$	109,067	$	449,380	$	152,374	$	514,624

Allocation of Noncontrolling Interests - Partnership

Substantially all of the income from discontinued operations for all periods presented in the Partnership's Consolidated Statements of Operations and Comprehensive Income is attributable to the common unitholders.

Properties Held-for-Sale

At June 30, 2016, one in-service property and 16 acres of undeveloped land were classified as held-for-sale but did not meet the criteria to be classified within discontinued operations. The following table illustrates aggregate balance sheet information for all held-for-sale properties at June 30, 2016 and December 31, 2015 (in thousands):

	Held-for-Sale Properties Included in Continuing Operations
	June 30, 2016			December 31, 2015
Land and improvements	$	603		$	9,797
Buildings and tenant improvements	3,329			39,480
Undeveloped land	596			—
Accumulated depreciation	(1,437		)	(7,183		)
Deferred leasing and other costs, net	11			3,293
Other assets	360			414
Total assets held-for-sale	$	3,462		$	45,801
Accrued expenses	$	43		$	322
Other liabilities	602			650
Total liabilities held-for-sale	$	645		$	972

Impairment Charges

As the result of changes in our intended use or plans for sale of certain of our undeveloped land holdings, we recognized impairment charges of $12.1 million for the six months endedJune 30, 2016. The various land holdings written down to fair value totaled 174 acres. The fair value of the land upon which we recognized impairment charges was estimated based on asset-specific offers to purchase and comparable transactions. Our valuation estimates primarily relied upon level 3 inputs.