Investments in Real Estate and Real Estate Under Construction

3 Months Ended

Mar. 31, 2017

Real Estate [Line Items]

Investments in Real Estate and Real Estate Under Construction

Investments in Real Estate and Real Estate Under Construction

The Company completed the following acquisition and build-to-suit arrangements during the three months ended March 31, 2017:

Property Type	Location	Acquisition Date	Initial Cost Basis		Lease Expiration	Land and Land Estate		Building and Improvements		Lease in-place Value Intangible		Below Market Lease Intangible
Office	Lake Jackson, TX (1)	January 2017	$	70,401	10/2036	$	3,078	$	67,323	$	—	$	—
Industrial	New Century, KS	February 2017	12,056		01/2027	—		13,198		1,648		(2,790		)
Industrial	Lebanon, IN	February 2017	36,194		01/2024	2,100		29,443		4,651		—
			$	118,651		$	5,178	$	109,964	$	6,299	$	(2,790	)

(1) Completed the construction of the final building of a four-building project. Initial basis excludes estimated developer partner payout of approximately $8,000.

The Company recognized aggregate transaction costs of $186 and $146 for the three months ended March 31, 2017 and 2016, respectively, which are included as property operating expenses within the Company's unaudited condensed consolidated statements of operations.

The Company is engaged in various forms of build-to-suit development activities. The Company, through lender subsidiaries and property owner subsidiaries, may enter into the following acquisition, development and construction arrangements: (1) lend funds to construct a build-to-suit project subject to a single-tenant lease with an agreement to purchase the property upon completion of construction and commencement of the single-tenant lease, (2) hire a developer to construct a built-to-suit project on owned property leased to a single tenant, (3) fund the construction of a build-to-suit project on owned property pursuant to the terms of a single-tenant lease or (4) enter into a purchase and sale agreement with a developer to acquire a single-tenant build-to-suit property upon completion of construction and commencement of a single-tenant lease.

As of March 31, 2017, the Company had the following development arrangements outstanding:

Location	Property Type	Square Feet (000's)	Maximum Commitment/Estimated Completion Cost		Lease Term (Years)	Estimated Completion/Acquisition Date	GAAP Investment Balance as of 3/31/2017
Charlotte, NC	Office	201	$	62,445	15	2Q 17	$	49,210
Opelika, AL	Industrial	165	37,000		25	2Q 17	19,918
		366	$	99,445			$	69,128

As of March 31, 2017 and December 31, 2016, the Company's aggregate investment in development arrangements was $69,128 and $106,652, respectively, which included $1,683 and $3,442 of capitalized interest, respectively, and is presented as investments in real estate under construction in the accompanying unaudited condensed consolidated balance sheets.

In addition, as of March 31, 2017, the Company had the following forward purchase commitments:

Location	Square Feet (000's)	Property Type	Maximum Acquisition Cost		Estimated Acquisition Date	Approximate Lease Term (Yrs)
Grand Prairie, TX	215	Industrial	$	24,725	2Q 17	20
Warren, MI (1)	260	Industrial	47,000		3Q 17	15
	475		$	71,725

(1) The Company issued a $4,600 letter of credit to secure its obligation to purchase the property.

The Company can give no assurances that any of these development arrangements or forward purchase commitments will be consummated or, if consummated, will perform to the Company's expectations.

LCIF [Member]

Real Estate [Line Items]

Investments in Real Estate and Real Estate Under Construction

Real Estate and Real Estate Under Construction

As of March 31, 2017, the Partnership had the following development arrangement outstanding:

Location	Property Type	Square Feet (000's)	Expected Maximum Commitment		Lease Term (Years)	Estimated Completion Date	GAAP Investment Balance as of 3/31/17(1)
Charlotte, NC	Office	201	$	62,445	15	2Q 17	$	49,210

(1)    Includes $1,455 of capitalized interest.

The Partnership can give no assurances that this development arrangement will be consummated or, if consummated, will perform to the Partnership's expectations.

During the three months ended March 31, 2017, the Partnership sold its interest in a vacant office property for a gross sale price of $4,130 and recognized an impairment charge of $2,497. During the three months ended March 31, 2016, the Partnership sold its interest in a property for a gross sale price of $30,050 and a vacant land parcel for $400. The Partnership recognized gains on sales of properties of $7,839 during the three months ended March 31, 2016.

The Partnership 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 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. Other than the property sold during the three months ended March 31, 2017, no properties were impaired during the three months ended March 31, 2017 and 2016.