Segment Information

3 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

SEGMENT INFORMATION

During the quarter ended March 31, 2014, the Company was managing its portfolio within seven segments: (1) Pennsylvania Suburbs, (2) Philadelphia Central Business District (CBD), (3) Metropolitan Washington D.C., (4) New Jersey/Delaware, (5) Richmond, Virginia, (6) Austin, Texas and (7) California. The Pennsylvania segment includes properties in Chester, Delaware, and Montgomery counties in the Philadelphia suburbs. The Philadelphia CBD segment includes properties located in the City of Philadelphia in Pennsylvania. The Metropolitan Washington, D.C. segment includes properties in Northern Virginia and southern Maryland. The New Jersey/Delaware segment includes properties in Burlington and Camden counties in New Jersey and in New Castle county in the state of Delaware. The Richmond, Virginia segment includes properties primarily in Albemarle, Chesterfield, Goochland and Henrico counties and one property in Durham, North Carolina. The Austin, Texas segment includes properties in Austin. The California segment includes properties in Oakland, Concord, and Carlsbad. The corporate group is responsible for cash and investment management, development of certain real estate properties during the construction period, and certain other general support functions.

Segment information is as follows (in thousands):

	Pennsylvania Suburbs		Philadelphia CBD			Metropolitan Washington, D.C.		New Jersey/Delaware		Richmond, Virginia			Austin, Texas		California		Corporate			Total
As of March 31, 2014:
Real estate investments, at cost:
Operating properties	$	1,209,328	$	1,318,170		$	1,219,542	$	414,353	$	310,465		$	36,480	$	192,951	$	—		$	4,701,289
Construction-in-progress																	90,140			90,140
Land inventory																	96,427			96,427
Investment in real estate ventures, at equity (a)	$	17,379	$	20,131		$	59,847	$	—	$	1,355		$	81,525	$	—	$	—		$	180,237
As of December 31, 2013:
Real estate investments, at cost:
Operating properties	$	1,199,105	$	1,300,666		$	1,214,965	$	414,716	$	310,397		$	36,856	$	192,584	$	—		$	4,669,289
Construction-in-progress																	74,174			74,174
Land inventory																	93,351			93,351
Investment in real estate ventures, at equity	$	17,272	$	19,975		$	59,905	$	—	$	1,400		$	81,960	$	—	$	—		$	180,512
For the three-month period ended March 31, 2014:
Total revenue	$	40,574	$	49,414		$	30,690	$	15,625	$	8,867		$	2,081	$	4,602	$	261		$	152,114
Property operating expenses, real estate taxes and third party management expenses	14,687		18,443			11,957		8,692		4,340			1,176		2,409		270			61,974
Net operating income	$	25,887	$	30,971		$	18,733	$	6,933	$	4,527		$	905	$	2,193	$	(9	)	$	90,140
Equity in income of real estate ventures	$	32	$	(21	)	$	67	$	18	$	(45	)	$	191	$	—	$	—		$	242
For the three-month period ended March 31, 2013:
Total revenue	$	37,916	$	35,925		$	27,785	$	14,919	$	8,765		$	9,257	$	4,605	$	382		$	139,554
Property operating expenses, real estate taxes and third party management expenses	14,436		13,534			10,763		7,031		3,683			3,958		2,160		(496		)	55,069
Net operating income	$	23,480	$	22,391		$	17,022	$	7,888	$	5,082		$	5,299	$	2,445	$	878		$	84,485
Equity in income of real estate ventures	$	31	$	566		$	16	$	908	$	(8	)	$	22	$	—	$	—		$	1,535

(a) Does not include the negative investment balance of one real estate venture totaling $1.2 million as of March 31, 2014, which was included in other liabilities.

Net operating income (“NOI”) is defined as total revenue less property operating expenses, real estate taxes and third party management expenses. Segment NOI includes revenue, real estate taxes and property operating expenses directly related to operation and management of the properties owned and managed within the respective geographical region. Segment NOI excludes property level depreciation and amortization, revenue and expenses directly associated with third party real estate management services, expenses associated with corporate administrative support services, and inter-company eliminations. NOI also does not reflect general and administrative expenses, interest expenses, real estate impairment losses, depreciation and amortization costs, capital expenditures and leasing costs. Trends in development and construction activities that could materially impact the Company’s results from operations are also not reflected in NOI. All companies may not calculate NOI in the same manner. NOI is the measure that is used by the Company to evaluate the operating performance of its real estate assets by segment. The Company also believes that NOI provides useful information to investors regarding its financial condition and results of operations because it reflects only those income and expenses recorded at the property level. The Company believes that net income, as defined by GAAP, is the most appropriate earnings measure. The following is a reconciliation of consolidated NOI to consolidated net income (loss), as defined by GAAP:

	Three month periods ended March 31,
	2014			2013
	(amounts in thousands)
Consolidated net operating income	$	90,140		$	84,485
Less:
Interest expense	(31,844		)	(30,914		)
Interest expense - amortization of deferred financing costs	(1,189		)	(1,161		)
Interest expense - financing obligation	(272		)	(218		)
Depreciation and amortization	(52,570		)	(49,476		)
General and administrative expenses	(8,181		)	(6,551		)
Loss on real estate venture transactions	(135		)	—
Loss on early extinguishment of debt	—			(3		)
Plus:
Interest income	385			58
Equity in income of real estate ventures	242			1,535
Gain on sale of undepreciated real estate	1,187			—
Loss from continuing operations	(2,237		)	(2,245		)
Income (loss) from discontinued operations	(8		)	6,164
Net income (loss)	$	(2,245	)	$	3,919