ACQUISITIONS AND DISPOSITIONS

12 Months Ended

Dec. 31, 2015

ACQUISITIONS AND DISPOSITIONS

ACQUISITIONS

4.  ACQUISITIONS AND DISPOSITIONS

The fair value of real estate acquired is recorded to the acquired tangible assets, consisting primarily of land, land improvements, building and improvements, tenant improvements,and furniture, fixtures, and equipment, and identified intangible assets and liabilities, consisting of the value of above‑market and below‑market leases, other value of in‑place leases and tenant relationships and acquired ground leases, if any, based in each case on their respective fair values. Loan premiums, in the case of above‑market rate loans, or loan discounts, in the case of below‑market rate loans, are recorded based on the fair value of any loans assumed in connection with acquiring the real estate.

During 2015, we acquired a 100% fee-simple interest in a surface parking lot known as 2 Kaiser Plaza from an unrelated third party. The parking lot has approximately 44,642 square feet of land and is located in Oakland, California. The acquisition was funded with proceeds from our unsecured credit facility, and the acquired property is reported as part of the office segment (Note 19).

	Asset	Date of		Purchase
Property	Type	Acquisition	Square Feet	Price
				(in thousands)
2 Kaiser Plaza, Oakland, CA	Surface parking lot	August 26, 2015	44,642	$	11,143

During 2015, we sold a 100% fee-simple interest in Civic Center located at 500 West Santa Ana Boulevard, Santa Ana, California to an unrelated third party.

	Asset	Date of		Sales			Gain on
Property	Type	Sale	Square Feet	Price			Sale
				(in thousands)
500 West Santa Ana Boulevard, Santa Ana, CA	Office	November 19, 2015	37,116	$	8,050	$	3,092

Acquisitions during 2014, funded with proceeds from drawdowns on our unsecured credit facilities, consisted of the following:

	Asset	Date of	Number	Rentable	Purchase
Property	Type	Acquisition	of Buildings	Square Feet	Price
					(in thousands)
4750 Wilshire Boulevard, Los Angeles, CA (1)	Office	April 18, 2014	1	143,361	$	44,936
Lindblade Media Center, Los Angeles, CA (2)	Office	October 21, 2014	3	32,428	$	18,500

(1) 100% fee-simple interest in an office building built in 1984 and renovated in 2014, located in the Mid-Wilshire submarket of Los Angeles, California.

(2) 100% fee-simple interest in a portfolio of creative office buildings located in the West Los Angeles submarket of Los Angeles, California.  Two of the buildings were built in 1930 and the third was built in 1957. The buildings were renovated in 2010.

In October 2013, we foreclosed on the LAX Holiday Inn, a select service hotel, and acquired a 100% fee-simple interest. A subsidiary of CIM Commercial was the first-mortgage lender of the note secured by the hotel. The income and expenses related to the first-mortgage on the LAX Holiday Inn are included in the consolidated statements of operations up until the date we took possession of the hotel. Built in 1973, this hotel has 405 rooms and is located in the LAX submarket of Los Angeles, California.

In addition, on February 2, 2016, we sold a 100% fee-simple interest in Courtyard Oakland located in Oakland, California to an unrelated third party for $43,800,000and recognized a gain of approximately $24,700,000.

The results of the operations of the properties acquired have been included in the consolidated statements of operations from the date of acquisition. The fair value of the assets acquired and liabilities assumed for the above-noted acquisitions during the years ended December 31, 2015, 2014, and 2013, respectively, are as follows:

	Year Ended December 31,
	2015 (1)		2014 (1)		2013 (1)
	(in thousands)
Land	$	10,931	$	22,975	$	15,662
Land improvements		110		535		436
Buildings and improvements		—		38,821		20,256
Tenant improvements		—		1,197		—
Furniture, fixtures, and equipment		—		—		2,481
Advance bookings		—		—		251
Working capital		—		—		1,014
Acquired in-place leases (2)		102		2,396		—
Acquired below-market leases (3)		—		(2,488)		—
Note receivable		—		—		(40,100)
Net assets acquired	$	11,143	$	63,436	$	—

(1) The purchase price of the acquisitions and the LAX Holiday Inn foreclosure completed during the years ended December 31, 2015, 2014 and 2013, respectively, were individually less than 5% and in aggregate less than 10% of our total assets as of December 31, 2015, 2014 and 2013, respectively.

(2) In‑place leases have a weighted average amortization period of 3.0 years and 5.1 years for the 2015 and 2014 acquisitions, respectively.

(3) Below‑market leases have a weighted average amortization period of 5.0 years for the 2014 acquisitions.

Acquisition related expenses of $107,000 and $491,000 were expensed as incurred during the years ended December 31, 2015 and 2014, respectively. Foreclosure related expenses of $1,393,000 related to the LAX Holiday Inn foreclosure were expensed as incurred during the year ended December 31, 2013.

Abandoned project costs of$486,000 and $132,000 were expensed as incurred during the years ended December 31, 2015 and 2014, respectively.