Discontinued Operations and Assets Held for Sale

9 Months Ended

Sep. 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 September 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	22	91	114
Total properties sold or classified as held-for-sale	1	22	153	176

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 nine months endedSeptember 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 (in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016		2015
Revenues	$	380		$	7		$	735	$	32,171
Operating expenses	(3		)	(50		)	6		(12,449		)
Depreciation and amortization	—			—			—		(3,517		)
Operating income	377			(43		)	741		16,205
Interest expense	—			—			—		(5,659		)
Income before gain on sales	377			(43		)	741		10,546
Gain on sale of depreciable properties	319			66			485		417,795
Income from discontinued operations before income taxes	696			23			1,226		428,341
Income tax expense	—			45			—		(3,175		)
Income from discontinued operations	$	696		$	68		$	1,226	$	425,166

We had no capital expenditures for the nine months endedSeptember 30, 2016 and $7.4 million for the nine months endedSeptember 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 (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
Income from continuing operations attributable to common shareholders	$	111,325	$	76,367	$	263,174	$	170,294
Income from discontinued operations attributable to common shareholders	689		67		1,214		420,764
Net income attributable to common shareholders	$	112,014	$	76,434	$	264,388	$	591,058

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 September 30, 2016, one in-service property and 14 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 (in thousands):

	Held-for-Sale Properties Included in Continuing Operations
	September 30, 2016			December 31, 2015
Land and improvements	$	5,142		$	9,797
Buildings and tenant improvements	6,032			39,480
Undeveloped land	9,939			—
Accumulated depreciation	(3,763		)	(7,183		)
Deferred leasing and other costs, net	419			3,293
Other assets	415			414
Total assets held-for-sale	$	18,184		$	45,801
Accrued expenses	$	150		$	322
Other liabilities	88			650
Total liabilities held-for-sale	$	238		$	972

Impairment Charges

The following table illustrates impairment charges recognized (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
Impairment charges - land	$	—	$	2,426	$	12,056	$	7,032
Impairment charges - building	3,042		—		3,042		864
Impairment charges	$	3,042	$	2,426	$	15,098	$	7,896

As the result of changes in our intended use or plans for sale of certain of our undeveloped land holdings, we recognized land impairment charges of $12.1 million for the nine months endedSeptember 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.