Property Dispositions, Discontinued Operations and Real Estate Impairment

3 Months Ended

Mar. 31, 2015

Discontinued Operations and Disposal Groups [Abstract]

Property Dispositions, Discontinued Operations and Real Estate Impairment

Property Dispositions, Discontinued Operations and Real Estate Impairment

During the three months ended March 31, 2015, the Company disposed of its interest in an office property to an unrelated third party for a gross disposition price of $4,950, which was held for sale at December 31, 2014, and conveyed two office properties, along with their escrow deposits, in satisfaction of a $30,293 non-recourse secured mortgage loan. In addition, during the three months ended March 31, 2015, the Company disposed of a vacant retail property, with a zero basis, upon the expiration of the related ground lease. During the three months ended March 31, 2014, the Company disposed of its interest in one vacant retail property to an unrelated third party for a gross disposition price of $350. During the three months ended March 31, 2015, the Company recognized aggregate gains on sales of properties of $1,725. In addition, during the three months ended March 31, 2015, the Company recognized aggregate net gains on debt satisfaction of $10,466 relating to disposed properties. The results of operations for properties disposed of in 2015, that were not classified as held for sale as of December 31, 2014, are included within continuing operations in the unaudited condensed consolidated financial statements in accordance with recent guidance issued by the FASB. As of March 31, 2015, the Company had no properties classified as held for sale.

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

	Three months ended March 31,
	2015		2014
Total gross revenues	$	163	$	9,275
Pre-tax income, including gains on sales	$	12,282	$	178

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 or transfer 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, the Company recognized $2,309 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 $1,139 and $16,400 in continuing operations during the three months ended March 31, 2015 and 2014. The Company determined that the expected undiscounted cash flows based upon the revised estimated holding periods of certain assets were below the current carrying values. Accordingly, the Company reduced the carrying value of the properties to their estimated then fair values of $475 and $5,574, respectively. The property impaired during the three months ended March 31, 2014 is for an office property in Rochester, New York, which is encumbered by a $17,234 non-recourse secured mortgage loan as of March 31, 2015.