ACQUISITIONS AND DISPOSITIONS (Tables)

9 Months Ended

Sep. 30, 2019

Business Combinations [Abstract]

Schedule of Assets Sold and Held for Sale

The following is the detail of the carrying amounts of assets and liabilities

at the time of the sales of the properties that occurred during the nine months ended September 30, 2019:

	(in thousands)
Assets
Investments in real estate, net	$	476,532
Deferred rent receivable and charges, net	55,297
Other intangible assets, net	316
Other assets	4,096
Total assets	$	536,241
Liabilities
Debt, net (1) (2)	$	318,072
Total liabilities	$	318,072

(1) Debt is presented net of deferred loan costs of $1,704,000 and accumulated amortization of $576,000.

(2) A mortgage loan with an outstanding principal balance of $28,200,000 was assumed by the buyer in connection with the sale of our property in San Francisco, California. A mortgage loan with an outstanding principal balance of $46,000,000 was prepaid in connection with the sale in March 2019 of our property in Washington, D.C. that was collateral for the loan. Mortgage loans with an aggregate outstanding principal balance of $205,500,000 were legally defeased in connection with the sale of the March Oakland Properties that were collateral for the loans. A mortgage loan with an outstanding principal balance of $39,500,000 was legally defeased in connection with the sale in May 2019 of our property in Oakland, California that was collateral for the loan.

The following is the detail of the carrying amounts of assets and liabilities for the office properties that are classified as held for sale on our consolidated balance sheet as of December 31, 2018:

	December 31, 2018
	(in thousands)
Assets
Investments in real estate, net (1)	$	17,123
Cash and cash equivalents	755
Accounts receivable, net	41
Deferred rent receivable and charges, net (2)	4,009
Other intangible assets, net (3)	220
Other assets	27
Total assets held for sale, net	$	22,175
Liabilities
Debt, net (4)	$	28,018
Accounts payable and accrued expenses	370
Due to related parties	81
Other liabilities	297
Total liabilities associated with assets held for sale, net	$	28,766

(1) Investments in real estate of $24,832,000 is presented net of accumulated depreciation of $7,709,000.

(2) Deferred rent receivable and charges consist of deferred rent receivable of $2,909,000 and deferred leasing costs of $1,669,000 net of accumulated amortization of $569,000.

(3) Other intangible assets, net, represent acquired in-place leases of $1,778,000, which are presented net of accumulated amortization of $1,558,000.

(4) Debt, net, includes the outstanding principal balance of 260 Townsend Street of $28,200,000, net of deferred loan costs of $243,000 and accumulated amortization of $61,000.

We sold 100% fee-simple interests in the following properties to unrelated third-parties during the nine months ended September 30, 2019. Transaction costs related to these sales were expensed as incurred.

Property	Asset Type	Date of Sale	Square Feet	Sales Price		Transaction Costs		Gain on Sale
				(in thousands)
March Oakland Properties, Oakland, CA (1)	Office / Parking Garage	March 1, 2019	975,596	$	512,016	$	8,971	$	289,779
830 1st Street, Washington, D.C.	Office	March 1, 2019	247,337	116,550		2,438		45,710
260 Townsend Street, San Francisco, CA	Office	March 14, 2019	66,682	66,000		2,539		42,092
1333 Broadway, Oakland, CA	Office	May 16, 2019	254,523	115,430		658		55,221
Union Square Properties, Washington, D.C. (2)	Office / Land	July 30, 2019	630,650	181,000		3,744		302
				$	990,996	$	18,350	$	433,104

(1) The "March Oakland Properties" consist of 1901 Harrison Street, 2100 Franklin Street, 2101 Webster Street, and 2353 Webster Street Parking Garage.

(2) The "Union Square Properties" consist of 999 North Capitol Street, 899 North Capitol Street and 901 North Capitol Street. Prior to the sale, we determined that the book values of such properties exceeded their estimated fair values and recognized an impairment charge of $0 and $69,000,000 for the three and nine months ended September 30, 2019 (Note 2). Our determination of the fair values of these properties was based on negotiations with the third-party buyer and the contract sales price. The gain on sale includes $113,000 of extinguishment of noncontrolling interests as a result of the sale.

Schedule of Asset Acquisitions

Property	Asset Type	Date of Acquisition	Square Feet	Purchase Price (1)
				(in thousands)
9460 Wilshire Boulevard, Beverly Hills, CA	Office	January 18, 2018	91,750	$	132,000

(1) In December 2017, at the time we entered into the purchase and sale agreement, we made a $20,000,000 non-refundable deposit to an escrow account that was included in other assets on our consolidated balance sheet at December 31, 2017. Transaction costs that were capitalized in connection with the acquisition of this property totaled $48,000, which are not included in the purchase price above.

Schedule of Fair Value of Net Assets Acquired

The fair value of the net assets acquired for the aforementioned acquisition during the nine months ended September 30, 2018 are as follows:

	(in thousands)
Land	$	52,199
Land improvements	756
Buildings and improvements	74,522
Tenant improvements	1,451
Acquired in-place leases (1)	7,003
Acquired above-market leases (1)	109
Acquired below-market leases (1)	(3,992		)
Net assets acquired	$	132,048

(1) Acquired in-place leases, above-market leases, and below-market leases have weighted average amortization periods of 3 years, 2 years, and 3 years, respectively.