SEGMENT DISCLOSURE

12 Months Ended

Dec. 31, 2014

SEGMENT DISCLOSURE

SEGMENT DISCLOSURE

18. SEGMENT DISCLOSURE

        In accordance with ASC Topic 280, Segment Reporting, our reportable segments consist of three types of commercial real estate properties, namely, office properties, hotel properties (which included an investment in a note receivable secured by a hotel property during the period from January 1, 2013 to October 8, 2013, and for the year ended December 31, 2012) and multifamily properties, as well as a segment for our lending operations, which is held for sale as of December 31, 2014. Management internally evaluates the operating performance and financial results of the segments based on net operating income. We also have certain general and administrative level activities, including public company expenses, legal, accounting, and tax preparation that are not considered separate operating segments and are not allocated to the segments. The reportable segments are accounted for on the same basis of accounting as described in Note 3.

        We evaluate the performance of our segments based on net operating income for our real estate segment, defined as: rental and other property income and tenant reimbursements less property and related expenses, and excludes nonproperty income and expenses, interest expense, depreciation and amortization, corporate related general and administrative expenses, and transaction costs.

        The net operating income of our reportable segments for the years ended December 31, 2014, 2013 and 2012, is as follows:

	Year Ended December 31,
	2014		2013		2012
	(in thousands)
Office properties:
Revenues	$	179,338	$	175,144	$	172,583
Property expenses:
Operating		73,666		67,906		66,230
General and administrative		981		1,078		1,122
Total property expenses		74,647		68,984		67,352
Segment net operating income—office		104,691		106,160		105,231
Hotel properties:
Revenues		56,096		40,680		41,086
Property expenses:
Operating		39,544		28,825		25,951
General and administrative		150		250		184
Total property expenses		39,694		29,075		26,135
Segment net operating income—hotel		16,402		11,605		14,951
Multifamily properties:
Revenues		20,719		19,989		18,844
Property expenses:
Operating		13,664		8,432		7,407
General and administrative		738		114		344
Total property expenses		14,402		8,546		7,751
Segment net operating income—multifamily		6,317		11,443		11,093
Total segment net operating income	$	127,410	$	129,208	$	131,275

        A reconciliation of segment net operating income to net income for the years ended December 31, 2014, 2013 and 2012, is as follows:

	Year Ended December 31,
	2014			2013			2012
	(in thousands)
Total segment net operating income	$	127,410		$	129,208		$	131,275
Interest		(19,073	)		(17,929	)		(18,856	)
General and administrative		(5,463	)		(1,126	)		(1,123	)
Asset management fees and other fees to related parties		(25,222	)		(21,767	)		(20,924	)
Transaction costs		(1,563	)		(5,063	)		(632	)
Depreciation and amortization		(69,047	)		(68,644	)		(69,943	)
Bargain purchase gain		4,918			—			—
Income from continuing operations		11,960			14,679			19,797
Discontinued operations
Income from operations of assets held for sale		12,638			—			—
Net income from discontinued operations		12,638			—			—
Net income		24,598			14,679			19,797
Net income attributable to noncontrolling interests		(220	)		(213	)		(208	)
Net income attributable to stockholders	$	24,378		$	14,466		$	19,589

        The condensed assets for each of the segments as of December 31, 2014 and 2013, along with capital expenditures and originations for the years ended December 31, 2014, 2013, and 2012 are as follows:

	December 31,
	2014		2013
	(in thousands)
Condensed assets:
Office properties	$	1,534,610	$	1,481,757
Hotel properties		174,679		174,263
Multifamily properties		171,226		173,985
Lending assets held for sale		208,799		—
Non-segment assets		5,368		4,472
Total assets	$	2,094,682	$	1,834,477

	Year Ended December 31,
	2014		2013		2012
	(in thousands)
Capital expenditures(1):
Office properties	$	26,157	$	20,523	$	23,154
Hotel properties		1,481		2,015		598
Multifamily properties		1,241		1,982		1,718
Total capital expenditures		28,879		24,520		25,470
Originations from assets held for sale		50,971		—		—
Total capital expenditures and originations	$	79,850	$	24,520	$	25,470

(1) Represents additions and improvements to real estate investments, excluding acquisitions.