Investment In Real Estate Joint Ventures And Partnerships

6 Months Ended

Jun. 30, 2011

Investment In Real Estate Joint Ventures And Partnerships

Investment In Real Estate Joint Ventures And Partnerships

Note 13. Investment in Real Estate Joint Ventures and Partnerships

We own interests in real estate joint ventures or limited partnerships and have tenancy-in-common interests in which we exercise significant influence, but do not have financial and operating control. We account for these investments using the equity method, and our interests range from 7.8% to 75%. Combined condensed financial information of these ventures (at 100%) is summarized as follows (in thousands):

	June 30, 2011		December 31, 2010
Combined Condensed Balance Sheets
Property	$	2,129,542	$	2,142,524
Accumulated depreciation		(271,200)		(247,996)
Property, net		1,858,342		1,894,528
Other assets, net		172,392		168,091
Total	$	2,030,734	$	2,062,619
Debt, net (primarily mortgages payable)	$	559,892	$	552,552
Amounts payable to Weingarten Realty Investors and affiliates		178,875		202,092
Other liabilities, net		48,431		45,331
Total		787,198		799,975
Accumulated equity		1,243,536		1,262,644
Total	$	2,030,734	$	2,062,619

	Three Months Ended June 30,				Six Months Ended June 30,
	2011		2010		2011		2010
Combined Condensed Statements of Income
Revenues, net	$	50,866	$	47,080	$	102,192	$	94,607
Expenses:
Depreciation and amortization		16,913		15,298		34,544		30,643
Interest, net		9,573		8,742		18,837		18,141
Operating		8,936		7,915		17,830		16,145
Real estate taxes, net		6,128		6,450		12,606		12,479
General and administrative		877		1,001		1,969		1,897
Provision for income taxes		116		85		201		145
Impairment loss		-		231		2,058		231
Total		42,543		39,722		88,045		79,681
Loss on sale of property		-		-		(21)		(3)
Net income	$	8,323	$	7,358	$	14,126	$	14,923

Our investment in real estate joint ventures and partnerships, as reported in our Condensed Consolidated Balance Sheets, differs from our proportionate share of the entities' underlying net assets due to basis differences, which arose upon the transfer of assets to the joint ventures. The net basis differences, which totaled $7.6 million and $8.8 million at June 30, 2011 and December 31, 2010, respectively, are generally amortized over the useful lives of the related assets.

Our real estate joint ventures and partnerships determined that the carrying amount of certain properties was not recoverable and that the properties should be written down to fair value. For the six months ended June 30, 2011, our unconsolidated real estate joint ventures and partnerships recorded an impairment charge of $2.1 million, and no such activity was present for the three months ended June 30, 2011. For both the three and six months ended June 30, 2010, $.2 million was recorded.

Fees earned by us for the management of these real estate joint ventures and partnerships totaled $1.5 million and $1.4 million for the three months ended June 30, 2011 and 2010, respectively, and $3.1 million and $2.9 million for the six months ended June 30, 2011 and 2010, respectively.

In March 2011, an unconsolidated real estate joint venture sold an industrial building with gross sales proceeds of $4.0 million.

In April 2011, we acquired a 50%-owned unconsolidated real estate joint venture interest in three retail properties for approximately $11.6 million. We also acquired our partner's 50% unconsolidated joint venture interest in a Florida development property that we had previously accounted for under the equity method. This transaction resulted in the consolidation of the property in our consolidated financial statements.

Effective April 1, 2010, we assumed control of two 50%-owned unconsolidated real estate joint ventures related to a development project in Sheridan, Colorado that we had previously accounted for under the equity method. This transaction resulted in the consolidation of the joint ventures in our consolidated financial statements.

During 2010, activity in our unconsolidated real estate joint ventures consisted of the sale of two retail buildings and two land parcels. In addition, we sold an unconsolidated real estate joint venture interest. Total aggregate gross sales proceeds for these transactions totaled $8.3 million.

Also, in the fourth quarter of 2010, we acquired interests in two unconsolidated real estate joint ventures for approximately $35.8 million.