SEGMENT DISCLOSURE

In accordance with ASC Topic 280, Segment Reporting, our reportable segments consist of three types of commercial real estate properties, namely, office, hotel and multifamily, as well as a segment for our lending business that is included in our continuing operations. The lending business that was sold during the year ended December 31, 2016, which was included in assets held for sale at December 31, 2015, is not included in our reportable segments. 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. The reportable segments are accounted for on the same basis of accounting as described in Note 2.

We evaluate the performance of our real estate segments based on net operating income, which is defined as rental and other property income and expense reimbursements less property related expenses, and excludes non-property income and expenses, interest expense, depreciation and amortization, corporate related general and administrative expenses, gain (loss) on sale of real estate, impairment of real estate, transaction costs, and provision for income taxes. For the lending segment, we define net operating income as interest income net of interest expense and general overhead expenses.

The net operating income of our segments included in continuing operations for the years ended December 31, 2017, 2016 and 2015 is as follows:



	Year Ended December 31,
	2017		2016		2015
	(in thousands)
Office:
Revenues	$	174,004	$	187,435	$	188,270
Property expenses:
Operating	68,801		81,217		80,014
General and administrative	981		1,234		771
Total property expenses	69,782		82,451		80,785
Segment net operating income—office	104,222		104,984		107,485
Hotel:
Revenues	38,585		48,379		61,436
Property expenses:
Operating	25,059		32,177		41,585
General and administrative	77		282		389
Total property expenses	25,136		32,459		41,974
Segment net operating income—hotel	13,449		15,920		19,462
Multifamily:
Revenues	13,566		20,303		18,721
Property expenses:
Operating	7,725		11,309		11,579
General and administrative	393		1,048		589
Total property expenses	8,118		12,357		12,168
Segment net operating income—multifamily	5,448		7,946		6,553
Lending:
Revenues	10,221		9,814		8,521
Lending expenses:
Interest expense	414		537		845
Fees to related party	3,464		3,555		3,850
General and administrative	1,010		1,166		1,032
Total lending expenses	4,888		5,258		5,727
Segment net operating income—lending	5,333		4,556		2,794
Total segment net operating income	$	128,452	$	133,406	$	136,294

A reconciliation of our segment net operating income to net income attributable to the Company for the years ended December 31, 2017, 2016 and 2015 is as follows:



	Year Ended December 31,
	2017			2016			2015
	(in thousands)
Total segment net operating income	$	128,452		$	133,406		$	136,294
Asset management and other fees to related parties	(26,787		)	(30,327		)	(29,319		)
Interest expense	(35,924		)	(33,848		)	(22,785		)
General and administrative	(3,018		)	(4,231		)	(6,621		)
Transaction costs	(11,862		)	(340		)	(1,382		)
Depreciation and amortization	(58,364		)	(71,968		)	(72,361		)
Impairment of real estate	(13,100		)	—			—
Gain on sale of real estate	401,737			39,666			3,092
Income from continuing operations before provision for income taxes	381,134			32,358			6,918
Provision for income taxes	(1,376		)	(1,646		)	(806		)
Net income from continuing operations	379,758			30,712			6,112
Discontinued operations:
Income from operations of assets held for sale	—			3,853			13,140
Gain on disposition of assets held for sale	—			—			5,151
Net income from discontinued operations	—			3,853			18,291
Net income	379,758			34,565			24,403
Net income attributable to noncontrolling interests	(21		)	(18		)	(11		)
Net income attributable to the Company	$	379,737		$	34,547		$	24,392

The condensed assets for each of the segments as of December 31, 2017 and 2016, along with capital expenditures and loan originations for the years ended December 31, 2017, 2016, and 2015 are as follows:



	December 31,
	2017		2016
	(in thousands)
Condensed assets:
Office	$	997,808	$	1,568,702
Hotel	107,790		115,955
Lending	92,919		91,191
Multifamily	815		170,159
Non-segment assets	137,056		76,877
Total assets	$	1,336,388	$	2,022,884



	Year Ended December 31,
	2017		2016		2015
	(in thousands)
Capital expenditures (1):
Office	$	24,907	$	30,563	$	27,686
Multifamily	693		548		2,498
Hotel	478		733		1,158
Total capital expenditures	26,078		31,844		31,342
Loan originations (2)	76,316		105,201		59,467
Total capital expenditures and loan originations (3)	$	102,394	$	137,045	$	90,809


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


(2)	For the year ended December 31, 2016, loan originations includes $966,000 of non-cash additions to commercial real estate loans for capitalized interest.


(3)	Includes the activity for dispositions through their respective disposition dates.