Revenue Recognition

12 Months Ended

Dec. 31, 2020

Revenue From Contract With Customer [Abstract]

Revenue Recognition

2. Revenue Recognition

Impact of the COVID-19 Pandemic on Revenue and Receivables

Beginning in March 2020, the retail sector within the continental U.S. has been significantly impacted by the COVID‑19 pandemic.  Though the impact of the COVID-19 pandemic on tenant operations has varied by tenant category, local conditions and applicable government mandates, a significant number of the Company’s tenants have experienced a reduction in sales and foot traffic, and many tenants were forced to limit their operations or close their businesses for a period of time.  As of December 31, 2020, all of the Company’s properties remain open and operational with 98% of tenants, at the Company’s share and based on average base rents, open for business (unaudited).  This compares to an open rate low of 45% in April 2020 (unaudited).  The COVID‑19 pandemic had no impact on the Company’s collection of rents for the first quarter of 2020, but it had a significant impact on the collection of rents for April 2020 through December 31, 2020.

The Company has engaged in discussions with most of its larger tenants that failed to satisfy all or a portion of their rent obligations during the second, third and fourth quarters of 2020 and has agreed to terms on rent-deferral arrangements (and, in a small number of cases, rent abatements) and other lease modifications with a significant number of such tenants.  The Company continues to evaluate its options with respect to tenants with which the Company has not reached satisfactory resolution of unpaid rents and has commenced collection actions against several tenants.  

The Company had net billed contractual tenant accounts receivable of $24.6 million at December 31, 2020.  

For those tenants where the Company is unable to assert that collection of amounts due over the lease term is probable, regardless if the Company has entered into a deferral agreement to extend the payment terms, the Company has categorized these tenants on the cash basis of accounting.  As a result, no rental income is recognized from such tenants once they have been placed on the cash basis of accounting until payments are received and all existing accounts receivable relating to these tenants have been reserved in full, including straight-line rental income.  The Company will remove the cash basis designation and resume recording rental income from such tenants during the period earned at such time it believes collection from the tenants is probable based upon a demonstrated payment history, improved liquidity, the addition of credit worth guarantors or a recapitalization event.

During the year ended December 31, 2020, tenants on the cash basis of accounting and other related reserves resulted in a reduction of rental income of $31.9 million (the Company’s share of unconsolidated joint ventures was $4.4 million).  These amounts also include reductions in contractual rental payments due from tenants as compared to pre-modification payments due to the impact of lease modifications, with a partial increase in straight-line rent to offset a portion of the impact on net income.  The Company’s share of lease modification adjustments for unconsolidated joint ventures was not material.  The aggregate amount of uncollectible revenue for the year ended December 31, 2020, primarily was due to the impact of the COVID-19 pandemic.

For the real estate industry, leasing transactions fall under Topic 842 (Note 1), which has been adopted at January 1, 2019.  Therefore, Fee and Other Income on the consolidated statements of operations was the revenue stream impacted by ASC 606 and includes revenue from contracts with customers and other property-related income, primarily composed of theater income, and is recognized in the period earned.  Fee and Other Income is as follows (in thousands):

	For the Year Ended December 31,
	2020		2019		2018
Revenue from contracts:
Asset and property management fees	$	31,255	$	42,355	$	31,751
Leasing commissions		5,528		6,300		6,380
Development fees		1,428		2,019		1,638
Disposition fees		3,142		3,454		2,959
Credit facility guaranty and refinancing fees		60		1,860		60
Total revenue from contracts with customers		41,413		55,988		42,788
Other property income:
Other		4,056		7,694		6,989
Total fee and other income	$	45,469	$	63,682	$	49,777

The aggregate amount of receivables from contracts with customers was $1.4 million as of both December 31, 2020 and 2019.

Contract assets are included in Other Assets, net on the consolidated balance sheets.  The significant changes in the leasing commission balances during the year ended December 31, 2020, are as follows (in thousands):

Balance as of January 1, 2020	$	1,101
Contract assets recognized		1,122
Contract assets billed		(1,710	)
Balance as of December 31, 2020	$	513

All revenue from contracts with customers meets the exemption criteria for variable consideration directly allocable to wholly unsatisfied performance obligations or unsatisfied promise within a series, and therefore, the Company does not disclose the value of transaction price allocated to unsatisfied performance obligations.  There is no fixed consideration included in the transaction price for any of these revenues.