SEGMENTS

12 Months Ended

Dec. 31, 2023

Segment Reporting [Abstract]

SEGMENTS

SEGMENTS

Centerspace operates in a single reportable segment which includes the ownership, management, development, redevelopment, and acquisition of apartment communities. Each of the operating properties is considered a separate operating segment because each property earns revenues, incurs expenses, and has discrete financial information. The chief operating decision-makers evaluate each property’s operating results to make decisions about resources to be allocated and to assess performance and do not group the properties based on geography, size, or type for this purpose. The apartment communities have similar long-term economic characteristics and provide similar products and services to residents. No apartment community comprises more than 10% of consolidated revenues, profits, or assets. Accordingly, the apartment communities are aggregated into a single reportable segment. “All other” is composed of non-multifamily properties, non-multifamily components of mixed-use properties and apartment communities the Company has disposed or designated as held for sale. During the year ended December 31, 2023, 13 sold apartment communities were reclassified from the multifamily segment to all other for all periods presented.

The chief executive officer and chief financial officer are the chief operating decision-makers. This team measures the performance of the reportable segment based on net operating income (“NOI”), a non-GAAP measure, which the Company defines as total real estate revenues less property operating expenses, including real estate taxes. Centerspace believes that NOI is an important supplemental measure of operating performance for real estate because it provides a measure of operations that excludes gain (loss) on the sale of real estate and other assets, impairment, depreciation, amortization, financing, property

management overhead, loss on litigation, casualty losses, and general and administrative expense. NOI does not represent cash generated by operating activities in accordance with GAAP and should not be considered an alternative to net income (loss), net income (loss) available for common shareholders, or cash flow from operating activities as a measure of financial performance.

The following tables present NOI for the years ended December 31, 2023, 2022, and 2021, respectively, along with reconciliations to net income as reported in the Consolidated Financial Statements. Segment assets are also reconciled to total assets as reported in the Consolidated Financial Statements.

	(in thousands)
Year ended December 31, 2023	Multifamily		All Other		Total
Revenue	$	246,364	$	14,945	$	261,309
Property operating expenses, including real estate taxes	98,762		7,050		105,812
Net operating income	$	147,602	$	7,895	$	155,497
Property management expenses					(9,353)
Casualty loss					(2,095)
Depreciation and amortization					(101,678)
Impairment of real estate investments					(5,218)
General and administrative expenses					(20,080)
Gain on sale of real estate and other investments					71,244
Loss on litigation settlement					(3,864)
Interest expense					(36,429)
Interest and other income					1,207
Net income					$	49,231

	(in thousands)
Year ended December 31, 2022	Multifamily		All Other		Total
Revenue	$	224,375	$	32,341	$	256,716
Property operating expenses, including real estate taxes	92,327		16,310		108,637
Net operating income	$	132,048	$	16,031	$	148,079
Property management expenses					(9,895)
Casualty loss					(1,591)
Depreciation and amortization					(105,257)
General and administrative expenses					(17,516)
Gain on sale of real estate and other investments					41
Interest expense					(32,750)
Interest and other income					1,248
Net loss					$	(17,641)

	(in thousands)
Year ended December 31, 2021	Multifamily		All Other		Total
Revenue	$	173,436	$	28,269	$	201,705
Property operating expenses, including real estate taxes	68,618		13,239		81,857
Net operating income	$	104,818	$	15,030	$	119,848
Property management expenses					(8,752)
Casualty loss					(344)
Depreciation and amortization					(92,165)
General and administrative expenses					(16,213)
Gain on sale of real estate and other investments					27,518
Interest expense					(29,078)
Interest income and other loss					(2,915)
Net loss					$	(2,101)

Segment Assets and Accumulated Depreciation 

	(in thousands)
As of December 31, 2023	Multifamily		All Other		Total
Segment assets
Property owned	$	2,402,544	$	17,602	$	2,420,146
Less accumulated depreciation	(526,565)		(4,138)		(530,703)
Total real estate investments	$	1,875,979	$	13,464	$	1,889,443
Cash and cash equivalents					8,630
Restricted cash					639
Other assets					27,649
Total Assets					$	1,926,361

	(in thousands)
As of December 31, 2022	Multifamily		All Other		Total
Segment assets
Property owned	$	2,274,202	$	259,922	$	2,534,124
Less accumulated depreciation	(443,828)		(91,573)		(535,401)
Total real estate investments	$	1,830,374	$	168,349	$	1,998,723
Cash and cash equivalents					10,458
Restricted cash					1,433
Other assets					22,687
Total Assets					$	2,033,301