SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2014

Segment Reporting [Abstract]

SEGMENT INFORMATION

9. SEGMENT INFORMATION

Segment description

In accordance with ASC Topic 280, “Segment Reporting,” the Company presents segment information based on the way that management organizes the segments within the enterprise for making operating decisions and assessing performance. The segment information is prepared on the same basis as the internally reported information used by the Company’s chief operating decision makers to manage the business.

The Company’s chief operating decision makers focus on the Company’s primary sources of income from apartment community rental operations. Apartment community rental operations are generally broken down into segments based on the various stages in the apartment community ownership lifecycle. These segments are described below. All commercial properties and other ancillary service and support operations are combined in the line item “other property segments” in the accompanying segment information. The segment information presented below reflects the segment categories based on the lifecycle status of each community as of January 1, 2013. The segment information for the three and six months ended June 30, 2014 and 2013 has been adjusted to reflect the impact of reclassifying, from the fully stabilized community segment to the held for sale and sold community segment, the operating results of three apartment communities designated as held for sale or sold in 2014 as described below.

• Fully stabilized communities – those apartment communities which have been stabilized (the earlier of the point at which a property reaches 95% occupancy or one year after completion of construction) for both 2014 and 2013.

• Newly stabilized communities – those apartment communities which reached stabilized occupancy in 2013.

• Lease-up communities – those apartment communities that are under development and lease-up but were not stabilized by the beginning of 2014, including communities that stabilized in 2014.

• Acquired communities – those communities acquired in 2014 or 2013.

• Held for sale and sold communities – those apartment and mixed-use communities classified as held for sale or sold in 2014 (see note 2).

Segment performance measure

Management uses contribution to consolidated property net operating income (“NOI”) as the performance measure for its operating segments. The Company uses NOI, including NOI of stabilized communities, as an operating measure. NOI is defined as rental and other property revenue from real estate operations less total property and maintenance expenses from real estate operations (excluding depreciation and amortization). The Company believes that NOI is an important supplemental measure of operating performance for a REIT’s operating real estate because it provides a measure of the core operations, rather than factoring in depreciation and amortization, financing costs and general and administrative expenses generally incurred at the corporate level. This measure is particularly useful, in the opinion of the Company, in evaluating the performance of operating segment groupings and individual properties. Additionally, the Company believes that NOI, as defined, is a widely accepted measure of comparative operating performance in the real estate investment community. The Company believes that the line on the Company’s consolidated statement of operations entitled “net income (loss)” is the most directly comparable GAAP measure to NOI.

Segment information

The following table reflects each segment’s contribution to consolidated revenues and NOI together with a reconciliation of segment contribution to property NOI to consolidated net income for the three and six months ended June 30, 2014 and 2013. Additionally, substantially all of the Company’s assets relate to the Company’s property rental operations. Asset cost, depreciation and amortization by segment are not presented because such information at the segment level is not reported internally.

	Three months ended June 30,						Six months ended June 30,
	2014			2013			2014			2013
Revenues
Fully stabilized communities	$	76,545		$	74,336		$	151,818		$	147,848
Newly stabilized communities		4,331			3,459			8,637			5,631
Lease-up communities		2,632			245			4,511			269
Acquired communities		1,233			383			2,443			383
Held for sale or sold communities		4,820			5,735			10,689			11,337
Other property segments		5,242			4,893			9,998			9,727
Other		223			229			442			443
Consolidated revenues	$	95,026		$	89,280		$	188,538		$	175,638
Contribution to Property Net Operating Income
Fully stabilized communities	$	46,086		$	45,945		$	92,404		$	91,525
Newly stabilized communities		2,693			1,912			5,365			2,586
Lease-up communities		1,041			(252	)		1,719			(280	)
Acquired communities		769			275			1,523			275
Held for sale or sold communities		2,574			3,414			5,346			6,541
Other property segments, including corporate management expenses		(155	)		(416	)		(652	)		(909	)
Consolidated property net operating income		53,008			50,878			105,705			99,738
Interest income		4			23			16			59
Other revenues		223			229			442			443
Depreciation		(20,829	)		(21,170	)		(42,596	)		(42,114	)
Interest expense		(10,433	)		(11,042	)		(21,677	)		(22,094	)
Amortization of deferred financing costs		(620	)		(645	)		(1,265	)		(1,269	)
General and administrative		(3,966	)		(4,170	)		(8,094	)		(8,415	)
Investment and development		(794	)		(592	)		(1,605	)		(1,081	)
Other investment costs		(210	)		(516	)		(483	)		(821	)
Other expenses		(502	)		—			(1,409	)		—
Gains on condominium sales activities, net		—			13,981			810			22,175
Equity in income of unconsolidated real estate entities, net		501			477			986			955
Other income (expense), net		(196	)		(282	)		(391	)		(448	)
Net loss on extinguishment of indebtedness		(4,287	)		—			(4,287	)		—
Income from continuing operations, before gains on sales of real estate assets		11,899			27,171			26,152			47,128
Gains on sales of real estate assets		36,092			—			36,092			—
Income from discontinued operations		—			443			—			876
Net income	$	47,991		$	27,614		$	62,244		$	48,004