Discontinued Operations and Real Estate Impairment Discontinued Operations and Real Estate Impairment

3 Months Ended

Mar. 31, 2014

Real Estate and Discontinued Operations [Abstract]

Discontinued Operations and Real Estate Impairment

Discontinued Operations and Real Estate Impairment

During the three months ended March 31, 2014, the Company disposed of its interest in one vacant property to an unrelated third party for a gross disposition price of $350. During the three months ended March 31, 2013, the Company disposed of its interest in one property to an unrelated third party for a gross disposition price of $1,900 and conveyed two properties in satisfaction of the $23,281 aggregate non-recourse secured mortgage loans. The Company recognized an aggregate net gain on debt satisfaction of $10,256 relating to discontinued operations during the three months ended March 31, 2013. As of March 31, 2014, the Company had four properties classified as held for sale. Held for sale properties had aggregate assets, primarily real estate, of $36,878 and aggregate liabilities of $19,204, including a non-recourse mortgage loan for $18,623, which was satisfied subsequent to March 31, 2014 (see note 15).

The following presents the operating results for the properties sold for the applicable periods:

	Three months ended March 31,
	2014			2013
Total gross revenues	$	1,214		$	4,382
Pre-tax income (loss)	$	(2,065	)	$	4,045

The Company assesses on a regular basis whether there are any indicators that the carrying value of its real estate assets may be impaired. Potential indicators may include an increase in vacancy at a property, tenant reduction in utilization of a property, tenant financial instability and the potential sale of the property in the near future. An asset is determined to be impaired if the asset's carrying value is in excess of its estimated fair value. During the three months ended March 31, 2014 and 2013, the Company recognized $2,309 and $7,344, respectively, of impairment charges in discontinued operations, relating to real estate assets that were disposed of below their carrying value or classified as held for sale.

In addition, the Company recognized impairment charges of $16,400 and $2,413 in continuing operations during the three months ended March 31, 2014 and 2013, respectively. The Company explored the possible disposition of non-core properties, including retail, underperforming and multi-tenant properties and determined that the expected undiscounted cash flows based upon a revised estimated holding period of the properties were below the current carrying values. Accordingly, the Company reduced the carrying values of these properties to their estimated fair values of $5,574 and $4,277, respectively. The property impaired during the three months ended March 31, 2014, is encumbered by a $17,470 non-recourse secured mortgage loan.