UNITED STATES | |
SECURITIES AND EXCHANGE COMMISSION | |
Washington, D.C. 20549 | |
_______________________________________ | |
Form 10-Q | |
(Mark One) | |
x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended June 30, 2013 | |
OR | |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to | |
Commission File Number 1-13232 (Apartment Investment and Management Company) | |
Commission File Number 0-24497 (AIMCO Properties, L.P.) | |
Apartment Investment and Management Company | |
AIMCO Properties, L.P. | |
(Exact name of registrant as specified in its charter) | |
Maryland (Apartment Investment and Management Company) | 84-1259577 | ||
Delaware (AIMCO Properties, L.P.) | 84-1275621 | ||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | ||
4582 South Ulster Street, Suite 1100 | |||
Denver, Colorado | 80237 | ||
(Address of principal executive offices) | (Zip Code) | ||
(303) 757-8101 | |||
(Registrant’s telephone number, including area code) | |||
Not Applicable | |||
(Former name, former address, and former fiscal year, if changed since last report) |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. | |
Apartment Investment and Management Company: Yes x No o | AIMCO Properties, L.P.: Yes x No o |
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). | |
Apartment Investment and Management Company: Yes x No o | AIMCO Properties, L.P.: Yes x No o |
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one): | ||||
Apartment Investment and Management Company: | ||||
Large accelerated filer | x | Accelerated filer | o | |
Non-accelerated filer | o | (Do not check if a smaller reporting company) | Smaller reporting company | o |
AIMCO Properties, L.P.: | ||||
Large accelerated filer | o | Accelerated filer | x | |
Non-accelerated filer | o | (Do not check if a smaller reporting company) | Smaller reporting company | o |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). | ||||||||
Apartment Investment and Management Company: Yes | o | No | x | AIMCO Properties, L.P.: Yes | o | No | x |
_______________________________________________________ |
The number of shares of Apartment Investment and Management Company |
Class A Common Stock outstanding as of August 1, 2013: 145,906,799 |
• | presents our business as a whole, in the same manner our management views and operates the business; |
• | eliminates duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the disclosures apply to both Aimco and the Aimco Operating Partnership; and |
• | saves time and cost through the preparation of a single combined report rather than two separate reports. |
Page | ||
ITEM 1. | ||
ITEM 2. | ||
ITEM 3. | ||
ITEM 4. | ||
ITEM 1A. | ||
ITEM 2. | ||
ITEM 6. | ||
ITEM 1. | Financial Statements |
June 30, 2013 | December 31, 2012 | ||||||
ASSETS | |||||||
Buildings and improvements | $ | 6,511,811 | $ | 6,376,338 | |||
Land | 1,952,811 | 1,940,254 | |||||
Total real estate | 8,464,622 | 8,316,592 | |||||
Less accumulated depreciation | (2,924,109 | ) | (2,811,906 | ) | |||
Net real estate ($427,043 and $599,302 related to VIEs) | 5,540,513 | 5,504,686 | |||||
Cash and cash equivalents ($20,995 and $23,599 related to VIEs) | 46,923 | 84,413 | |||||
Restricted cash ($36,573 and $38,576 related to VIEs) | 123,112 | 146,782 | |||||
Accounts receivable, net | 29,906 | 34,020 | |||||
Notes receivable | 217,013 | 102,897 | |||||
Other assets ($221,911 and $221,638 related to VIEs) | 513,248 | 519,904 | |||||
Assets held for sale | — | 8,678 | |||||
Total assets | $ | 6,470,715 | $ | 6,401,380 | |||
LIABILITIES AND EQUITY | |||||||
Non-recourse property debt ($372,489 and $495,012 related to VIEs) | $ | 4,656,497 | $ | 4,681,836 | |||
Revolving credit facility borrowings | 187,050 | — | |||||
Total indebtedness | 4,843,547 | 4,681,836 | |||||
Accounts payable | 33,415 | 30,747 | |||||
Accrued liabilities and other ($162,618 and $162,795 related to VIEs) | 334,473 | 318,595 | |||||
Deferred income | 116,238 | 128,468 | |||||
Liabilities related to assets held for sale | — | 6,794 | |||||
Total liabilities | 5,327,673 | 5,166,440 | |||||
Preferred noncontrolling interests in Aimco Operating Partnership | 79,984 | 80,046 | |||||
Commitments and contingencies (Note 8) | — | — | |||||
Equity: | |||||||
Perpetual Preferred Stock | 68,114 | 68,114 | |||||
Common Stock, $0.01 par value, 505,787,260 shares authorized, 145,906,799 and 145,563,903 shares issued/outstanding at June 30, 2013 and December 31, 2012, respectively | 1,459 | 1,456 | |||||
Additional paid-in capital | 3,704,026 | 3,712,684 | |||||
Accumulated other comprehensive loss | (4,365 | ) | (3,542 | ) | |||
Distributions in excess of earnings | (2,917,863 | ) | (2,863,287 | ) | |||
Total Aimco equity | 851,371 | 915,425 | |||||
Noncontrolling interests in consolidated real estate partnerships | 246,793 | 271,065 | |||||
Common noncontrolling interests in Aimco Operating Partnership | (35,106 | ) | (31,596 | ) | |||
Total equity | 1,063,058 | 1,154,894 | |||||
Total liabilities and equity | $ | 6,470,715 | $ | 6,401,380 |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
REVENUES | |||||||||||||||
Rental and other property revenues | $ | 251,853 | $ | 244,374 | $ | 499,700 | $ | 488,279 | |||||||
Tax credit and asset management revenues | 7,809 | 8,914 | 15,061 | 16,985 | |||||||||||
Total revenues | 259,662 | 253,288 | 514,761 | 505,264 | |||||||||||
OPERATING EXPENSES | |||||||||||||||
Property operating expenses | 101,717 | 99,807 | 203,420 | 198,418 | |||||||||||
Investment management expenses | 1,697 | 3,240 | 3,130 | 6,628 | |||||||||||
Depreciation and amortization | 78,345 | 87,229 | 158,618 | 173,795 | |||||||||||
Provision for real estate impairment losses | — | 2,275 | — | 8,349 | |||||||||||
General and administrative expenses | 11,153 | 13,556 | 22,932 | 25,181 | |||||||||||
Other expense (income), net | 2,226 | (957 | ) | 4,436 | 4,772 | ||||||||||
Total operating expenses | 195,138 | 205,150 | 392,536 | 417,143 | |||||||||||
Operating income | 64,524 | 48,138 | 122,225 | 88,121 | |||||||||||
Interest income, net | 2,651 | 2,397 | 9,072 | 4,854 | |||||||||||
Interest expense | (61,821 | ) | (60,322 | ) | (124,267 | ) | (125,130 | ) | |||||||
Equity in income (losses) of unconsolidated real estate partnerships | 104 | (2,242 | ) | 628 | (3,005 | ) | |||||||||
(Loss) gain on dispositions and other, net | (1,154 | ) | 4,314 | (2,664 | ) | 4,602 | |||||||||
Income (loss) before income taxes and discontinued operations | 4,304 | (7,715 | ) | 4,994 | (30,558 | ) | |||||||||
Income tax (expense) benefit | (116 | ) | 234 | (163 | ) | 460 | |||||||||
Income (loss) from continuing operations | 4,188 | (7,481 | ) | 4,831 | (30,098 | ) | |||||||||
Income from discontinued operations, net | 2,791 | 41,612 | 4,981 | 74,876 | |||||||||||
Net income | 6,979 | 34,131 | 9,812 | 44,778 | |||||||||||
Noncontrolling interests: | |||||||||||||||
Net loss (income) attributable to noncontrolling interests in consolidated real estate partnerships | 6,150 | (9,665 | ) | 11,112 | (17,430 | ) | |||||||||
Net income attributable to preferred noncontrolling interests in Aimco Operating Partnership | (1,606 | ) | (1,611 | ) | (3,212 | ) | (3,281 | ) | |||||||
Net (income) loss attributable to common noncontrolling interests in Aimco Operating Partnership | (575 | ) | (55 | ) | (872 | ) | 682 | ||||||||
Net loss (income) attributable to noncontrolling interests | 3,969 | (11,331 | ) | 7,028 | (20,029 | ) | |||||||||
Net income attributable to Aimco | 10,948 | 22,800 | 16,840 | 24,749 | |||||||||||
Net income attributable to Aimco preferred stockholders | (701 | ) | (22,182 | ) | (1,403 | ) | (34,621 | ) | |||||||
Net income attributable to participating securities | (140 | ) | (95 | ) | (280 | ) | (214 | ) | |||||||
Net income (loss) attributable to Aimco common stockholders | $ | 10,107 | $ | 523 | $ | 15,157 | $ | (10,086 | ) | ||||||
Earnings (loss) attributable to Aimco per common share – basic and diluted (Note 9): | |||||||||||||||
Income (loss) from continuing operations attributable to Aimco common stockholders | $ | 0.02 | $ | (0.26 | ) | $ | 0.01 | $ | (0.56 | ) | |||||
Income from discontinued operations attributable to Aimco common stockholders | 0.05 | 0.26 | 0.09 | 0.48 | |||||||||||
Net income (loss) attributable to Aimco common stockholders | $ | 0.07 | $ | — | $ | 0.10 | $ | (0.08 | ) | ||||||
Weighted average common shares outstanding – basic | 145,321 | 127,395 | 145,245 | 123,960 | |||||||||||
Weighted average common shares outstanding – diluted | 145,674 | 127,395 | 145,532 | 123,960 | |||||||||||
Dividends declared per common share | $ | 0.24 | $ | 0.18 | $ | 0.48 | $ | 0.36 |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Net income | $ | 6,979 | $ | 34,131 | $ | 9,812 | $ | 44,778 | |||||||
Other comprehensive income (loss): | |||||||||||||||
Unrealized gains (losses) on interest rate swaps | 1,430 | (1,640 | ) | 1,608 | (1,774 | ) | |||||||||
Losses on interest rate swaps reclassified into interest expense from accumulated other comprehensive loss | 417 | 415 | 836 | 840 | |||||||||||
Unrealized (losses) gains on debt securities classified as available-for-sale | (1,347 | ) | (1,114 | ) | (3,055 | ) | 1,459 | ||||||||
Other comprehensive income (loss) | 500 | (2,339 | ) | (611 | ) | 525 | |||||||||
Comprehensive income | 7,479 | 31,792 | 9,201 | 45,303 | |||||||||||
Comprehensive loss (income) attributable to noncontrolling interests | 3,767 | (11,093 | ) | 6,816 | (19,986 | ) | |||||||||
Comprehensive income attributable to Aimco | $ | 11,246 | $ | 20,699 | $ | 16,017 | $ | 25,317 |
Six Months Ended | |||||||
June 30, | |||||||
2013 | 2012 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
Net income | $ | 9,812 | $ | 44,778 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 158,618 | 173,795 | |||||
Provision for real estate impairment losses | — | 8,349 | |||||
Equity in (income) losses of unconsolidated real estate partnerships | (628 | ) | 3,005 | ||||
Discontinued operations | (4,620 | ) | (56,003 | ) | |||
Other adjustments | 1,440 | (9,149 | ) | ||||
Net changes in operating assets and operating liabilities | 8,404 | (12,743 | ) | ||||
Net cash provided by operating activities | 173,026 | 152,032 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||
Purchases of real estate | (19,444 | ) | (79,743 | ) | |||
Capital expenditures | (163,368 | ) | (117,431 | ) | |||
Proceeds from dispositions of real estate | 7,960 | 153,869 | |||||
Purchases of corporate assets | (5,123 | ) | (4,851 | ) | |||
Purchase of property loans | (119,101 | ) | — | ||||
Change in restricted cash | 19,932 | (6,279 | ) | ||||
Proceeds from sale of interests in and distributions from unconsolidated real estate partnerships | 1,701 | 14,698 | |||||
Other investing activities | 10,674 | 10,399 | |||||
Net cash used in investing activities | (266,769 | ) | (29,338 | ) | |||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
Proceeds from non-recourse property debt | 111,007 | 115,654 | |||||
Principal repayments on non-recourse property debt | (153,532 | ) | (173,947 | ) | |||
Net borrowings on revolving credit facility | 187,050 | — | |||||
Proceeds from issuance of Preferred Stock | — | 9,818 | |||||
Proceeds from issuance of Common Stock | — | 558,600 | |||||
Redemptions of Preferred Stock | — | (300,938 | ) | ||||
Proceeds from Common Stock option exercises | 983 | 48,906 | |||||
Payment of dividends to holders of Preferred Stock | (1,402 | ) | (28,999 | ) | |||
Payment of dividends to holders of Common Stock | (70,014 | ) | (45,773 | ) | |||
Payment of distributions to noncontrolling interests | (22,513 | ) | (26,958 | ) | |||
Purchases of noncontrolling interests in consolidated real estate partnerships | (2,528 | ) | (48,280 | ) | |||
Other financing activities | 7,202 | (8,879 | ) | ||||
Net cash provided by financing activities | 56,253 | 99,204 | |||||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (37,490 | ) | 221,898 | ||||
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 84,413 | 91,066 | |||||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ | 46,923 | $ | 312,964 |
June 30, 2013 | December 31, 2012 | ||||||
ASSETS | |||||||
Buildings and improvements | $ | 6,511,811 | $ | 6,376,338 | |||
Land | 1,952,811 | 1,940,254 | |||||
Total real estate | 8,464,622 | 8,316,592 | |||||
Less accumulated depreciation | (2,924,109 | ) | (2,811,906 | ) | |||
Net real estate ($427,043 and $599,302 related to VIEs) | 5,540,513 | 5,504,686 | |||||
Cash and cash equivalents ($20,995 and $23,599 related to VIEs) | 46,923 | 84,413 | |||||
Restricted cash ($36,573 and $38,576 related to VIEs) | 123,112 | 146,782 | |||||
Accounts receivable, net | 29,906 | 34,020 | |||||
Notes receivable | 217,013 | 102,897 | |||||
Other assets ($221,911 and $221,638 related to VIEs) | 513,248 | 519,904 | |||||
Assets held for sale | — | 8,678 | |||||
Total assets | $ | 6,470,715 | $ | 6,401,380 | |||
LIABILITIES AND PARTNERS' CAPITAL | |||||||
Non-recourse property debt ($372,489 and $495,012 related to VIEs) | $ | 4,656,497 | $ | 4,681,836 | |||
Revolving credit facility borrowings | 187,050 | — | |||||
Total indebtedness | 4,843,547 | 4,681,836 | |||||
Accounts payable | 33,415 | 30,747 | |||||
Accrued liabilities and other ($162,618 and $162,795 related to VIEs) | 334,473 | 318,595 | |||||
Deferred income | 116,238 | 128,468 | |||||
Liabilities related to assets held for sale | — | 6,794 | |||||
Total liabilities | 5,327,673 | 5,166,440 | |||||
Redeemable preferred units | 79,984 | 80,046 | |||||
Commitments and contingencies (Note 8) | — | — | |||||
Partners’ Capital: | |||||||
Preferred units | 68,114 | 68,114 | |||||
General Partner and Special Limited Partner | 783,257 | 847,311 | |||||
Limited Partners | (35,106 | ) | (31,596 | ) | |||
Partners’ capital attributable to the Aimco Operating Partnership | 816,265 | 883,829 | |||||
Noncontrolling interests in consolidated real estate partnerships | 246,793 | 271,065 | |||||
Total partners’ capital | 1,063,058 | 1,154,894 | |||||
Total liabilities and partners’ capital | $ | 6,470,715 | $ | 6,401,380 |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
REVENUES | |||||||||||||||
Rental and other property revenues | $ | 251,853 | $ | 244,374 | $ | 499,700 | $ | 488,279 | |||||||
Tax credit and asset management revenues | 7,809 | 8,914 | 15,061 | 16,985 | |||||||||||
Total revenues | 259,662 | 253,288 | 514,761 | 505,264 | |||||||||||
OPERATING EXPENSES | |||||||||||||||
Property operating expenses | 101,717 | 99,807 | 203,420 | 198,418 | |||||||||||
Investment management expenses | 1,697 | 3,240 | 3,130 | 6,628 | |||||||||||
Depreciation and amortization | 78,345 | 87,229 | 158,618 | 173,795 | |||||||||||
Provision for real estate impairment losses | — | 2,275 | — | 8,349 | |||||||||||
General and administrative expenses | 11,153 | 13,556 | 22,932 | 25,181 | |||||||||||
Other expense (income), net | 2,226 | (957 | ) | 4,436 | 4,772 | ||||||||||
Total operating expenses | 195,138 | 205,150 | 392,536 | 417,143 | |||||||||||
Operating income | 64,524 | 48,138 | 122,225 | 88,121 | |||||||||||
Interest income, net | 2,651 | 2,397 | 9,072 | 4,854 | |||||||||||
Interest expense | (61,821 | ) | (60,322 | ) | (124,267 | ) | (125,130 | ) | |||||||
Equity in income (losses) of unconsolidated real estate partnerships | 104 | (2,242 | ) | 628 | (3,005 | ) | |||||||||
(Loss) gain on dispositions and other, net | (1,154 | ) | 4,314 | (2,664 | ) | 4,602 | |||||||||
Income (loss) before income taxes and discontinued operations | 4,304 | (7,715 | ) | 4,994 | (30,558 | ) | |||||||||
Income tax (expense) benefit | (116 | ) | 234 | (163 | ) | 460 | |||||||||
Income (loss) from continuing operations | 4,188 | (7,481 | ) | 4,831 | (30,098 | ) | |||||||||
Income from discontinued operations, net | 2,791 | 41,612 | 4,981 | 74,876 | |||||||||||
Net income | 6,979 | 34,131 | 9,812 | 44,778 | |||||||||||
Net loss (income) attributable to noncontrolling interests in consolidated real estate partnerships | 6,150 | (9,665 | ) | 11,112 | (17,430 | ) | |||||||||
Net income attributable to the Aimco Operating Partnership | 13,129 | 24,466 | 20,924 | 27,348 | |||||||||||
Net income attributable to the Aimco Operating Partnership’s preferred unitholders | (2,307 | ) | (23,793 | ) | (4,615 | ) | (37,902 | ) | |||||||
Net income attributable to participating securities | (140 | ) | (95 | ) | (280 | ) | (214 | ) | |||||||
Net income (loss) attributable to the Aimco Operating Partnership's common unitholders | $ | 10,682 | $ | 578 | $ | 16,029 | $ | (10,768 | ) | ||||||
Earnings (loss) attributable to the Aimco Operating Partnership per common unit – basic and diluted (Note 9): | |||||||||||||||
Income (loss) from continuing operations attributable to the Aimco Operating Partnership’s common unitholders | $ | 0.02 | $ | (0.26 | ) | $ | 0.01 | $ | (0.56 | ) | |||||
Income from discontinued operations attributable to the Aimco Operating Partnership’s common unitholders | 0.05 | 0.26 | 0.09 | 0.48 | |||||||||||
Net income (loss) attributable to the Aimco Operating Partnership’s common unitholders | $ | 0.07 | $ | — | $ | 0.10 | $ | (0.08 | ) | ||||||
Weighted average common units outstanding – basic | 153,294 | 135,622 | 153,217 | 132,159 | |||||||||||
Weighted average common units outstanding – diluted | 153,647 | 135,622 | 153,504 | 132,159 | |||||||||||
Distributions declared per common unit | $ | 0.24 | $ | 0.18 | $ | 0.48 | $ | 0.36 |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Net income | $ | 6,979 | $ | 34,131 | $ | 9,812 | $ | 44,778 | |||||||
Other comprehensive income (loss): | |||||||||||||||
Unrealized gains (losses) on interest rate swaps | 1,430 | (1,640 | ) | 1,608 | (1,774 | ) | |||||||||
Losses on interest rate swaps reclassified into interest expense from accumulated other comprehensive loss | 417 | 415 | 836 | 840 | |||||||||||
Unrealized (losses) gains on debt securities classified as available-for-sale | (1,347 | ) | (1,114 | ) | (3,055 | ) | 1,459 | ||||||||
Other comprehensive income (loss) | 500 | (2,339 | ) | (611 | ) | 525 | |||||||||
Comprehensive income | 7,479 | 31,792 | 9,201 | 45,303 | |||||||||||
Comprehensive loss (income) attributable to noncontrolling interests | 5,965 | (9,562 | ) | 10,855 | (17,341 | ) | |||||||||
Comprehensive income attributable to the Aimco Operating Partnership | $ | 13,444 | $ | 22,230 | $ | 20,056 | $ | 27,962 |
Six Months Ended | |||||||
June 30, | |||||||
2013 | 2012 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
Net income | $ | 9,812 | $ | 44,778 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 158,618 | 173,795 | |||||
Provision for real estate impairment losses | — | 8,349 | |||||
Equity in (income) losses of unconsolidated real estate partnerships | (628 | ) | 3,005 | ||||
Discontinued operations | (4,620 | ) | (56,003 | ) | |||
Other adjustments | 1,440 | (9,149 | ) | ||||
Net changes in operating assets and operating liabilities | 8,404 | (12,743 | ) | ||||
Net cash provided by operating activities | 173,026 | 152,032 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||
Purchases of real estate | (19,444 | ) | (79,743 | ) | |||
Capital expenditures | (163,368 | ) | (117,431 | ) | |||
Proceeds from dispositions of real estate | 7,960 | 153,869 | |||||
Purchases of corporate assets | (5,123 | ) | (4,851 | ) | |||
Purchase of property loans | (119,101 | ) | — | ||||
Change in restricted cash | 19,932 | (6,279 | ) | ||||
Proceeds from sale of interests in and distributions from unconsolidated real estate partnerships | 1,701 | 14,698 | |||||
Other investing activities | 10,674 | 10,399 | |||||
Net cash used in investing activities | (266,769 | ) | (29,338 | ) | |||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
Proceeds from non-recourse property debt | 111,007 | 115,654 | |||||
Principal repayments on non-recourse property debt | (153,532 | ) | (173,947 | ) | |||
Net borrowings on revolving credit facility | 187,050 | — | |||||
Proceeds from issuance of Preferred Units to Aimco | — | 9,818 | |||||
Proceeds from issuance of common partnership units to Aimco | — | 558,600 | |||||
Redemption of Preferred Units from Aimco | — | (300,938 | ) | ||||
Proceeds from Aimco Common Stock option exercises | 983 | 48,906 | |||||
Payment of distributions to Preferred Units | (4,614 | ) | (32,280 | ) | |||
Payment of distributions to General Partner and Special Limited Partner | (70,014 | ) | (45,773 | ) | |||
Payment of distributions to Limited Partners | (3,884 | ) | (2,935 | ) | |||
Payment of distributions to noncontrolling interests | (15,417 | ) | (20,742 | ) | |||
Purchases of noncontrolling interests in consolidated real estate partnerships | (2,528 | ) | (48,280 | ) | |||
Other financing activities | 7,202 | (8,879 | ) | ||||
Net cash provided by financing activities | 56,253 | 99,204 | |||||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (37,490 | ) | 221,898 | ||||
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 84,413 | 91,066 | |||||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ | 46,923 | $ | 312,964 |
Balance, December 31, 2012 | $ | 80,046 | |
Distributions to preferred unitholders | (3,212 | ) | |
Redemption of preferred units | (62 | ) | |
Net income | 3,212 | ||
Balance, June 30, 2013 | $ | 79,984 |
Aimco Equity | Noncontrolling interests in consolidated real estate partnerships | Common noncontrolling interests in Aimco Operating Partnership | Total Equity | ||||||||||||
Balance, December 31, 2012 | $ | 915,425 | $ | 271,065 | $ | (31,596 | ) | $ | 1,154,894 | ||||||
Contributions | — | 1,157 | — | 1,157 | |||||||||||
Preferred stock dividends | (1,402 | ) | — | — | (1,402 | ) | |||||||||
Common dividends and distributions | (70,014 | ) | (16,664 | ) | (3,884 | ) | (90,562 | ) | |||||||
Amortization of stock-based compensation cost | 3,459 | — | — | 3,459 | |||||||||||
Stock option exercises | 983 | — | — | 983 | |||||||||||
Effect of changes in ownership for consolidated entities (Note 4) | (12,489 | ) | 2,012 | (666 | ) | (11,143 | ) | ||||||||
Change in accumulated other comprehensive loss | (823 | ) | 257 | (45 | ) | (611 | ) | ||||||||
Other | (608 | ) | 78 | 213 | (317 | ) | |||||||||
Net income (loss) | 16,840 | (11,112 | ) | 872 | 6,600 | ||||||||||
Balance, June 30, 2013 | $ | 851,371 | $ | 246,793 | $ | (35,106 | ) | $ | 1,063,058 |
Partners’ capital attributable to the Partnership | |||
Balance, December 31, 2012 | $ | 883,829 | |
Distributions to preferred units held by Aimco | (1,402 | ) | |
Distributions to common units held by Aimco | (70,014 | ) | |
Distributions to common units held by Limited Partners | (3,884 | ) | |
Amortization of Aimco stock-based compensation cost | 3,459 | ||
Common OP Units issued to Aimco in connection with Aimco stock option exercises | 983 | ||
Effect of changes in ownership for consolidated entities (Note 4) | (13,155 | ) | |
Change in accumulated other comprehensive loss | (868 | ) | |
Other | (395 | ) | |
Net income | 17,712 | ||
Balance, June 30, 2013 | $ | 816,265 |
December 31, 2012 | |||
Real estate, net | $ | 7,968 | |
Other assets | 710 | ||
Assets held for sale | $ | 8,678 | |
Property debt | $ | 6,611 | |
Other liabilities | 183 | ||
Liabilities related to assets held for sale | $ | 6,794 |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Rental and other property revenues | $ | 247 | $ | 20,892 | $ | 781 | $ | 46,317 | |||||||
Property operating expenses | (229 | ) | (6,433 | ) | (427 | ) | (19,341 | ) | |||||||
Depreciation and amortization | (43 | ) | (7,357 | ) | (140 | ) | (16,203 | ) | |||||||
(Provision for) recovery of real estate impairment losses | (103 | ) | (5,773 | ) | 124 | (6,384 | ) | ||||||||
Operating (loss) income | (128 | ) | 1,329 | 338 | 4,389 | ||||||||||
Interest income | 114 | 134 | 172 | 284 | |||||||||||
Interest expense | (70 | ) | (2,753 | ) | (165 | ) | (8,387 | ) | |||||||
(Loss) income before gain on dispositions of real estate and income tax | (84 | ) | (1,290 | ) | 345 | (3,714 | ) | ||||||||
Gain on dispositions of real estate | 2,663 | 48,518 | 4,606 | 84,211 | |||||||||||
Income tax benefit (expense) | 212 | (5,616 | ) | 30 | (5,621 | ) | |||||||||
Income from discontinued operations, net | $ | 2,791 | $ | 41,612 | $ | 4,981 | $ | 74,876 | |||||||
Loss (income) from discontinued operations attributable to noncontrolling interests in consolidated real estate partnerships | 5,452 | (5,153 | ) | 8,673 | (11,684 | ) | |||||||||
Income from discontinued operations attributable to the Aimco Operating Partnership | 8,243 | 36,459 | 13,654 | 63,192 | |||||||||||
Income from discontinued operations attributable to noncontrolling interests in Aimco Operating Partnership | (455 | ) | (2,262 | ) | (738 | ) | (3,951 | ) | |||||||
Income from discontinued operations attributable to Aimco | $ | 7,788 | $ | 34,197 | $ | 12,916 | $ | 59,241 |
June 30, 2013 | December 31, 2012 | ||||||
Real estate, net | $ | 128,917 | $ | 127,025 | |||
Cash and cash equivalents and restricted cash | 30,092 | 31,560 | |||||
Investment in unconsolidated real estate partnerships | 13,943 | 15,997 | |||||
Other assets | 4,150 | 4,163 | |||||
Total assets | $ | 177,102 | $ | 178,745 | |||
Total indebtedness | $ | 112,077 | $ | 110,737 | |||
Accrued and other liabilities | 29,646 | 29,435 | |||||
Total liabilities | $ | 141,723 | $ | 140,172 |
Three Months Ended | Six Months Ended | ||||||
June 30, 2013 | June 30, 2013 | ||||||
Revenues | $ | 7,395 | $ | 13,333 | |||
Expenses | (5,667 | ) | (11,935 | ) | |||
Equity in earnings or loss of unconsolidated entities, gains or losses on dispositions and other, net | (2,997 | ) | (4,094 | ) | |||
Net loss related to legacy asset management business | (1,269 | ) | (2,696 | ) | |||
Noncontrolling interests in consolidated real estate partnerships | 1,623 | 3,410 | |||||
Net income of legacy asset management business attributable to Aimco and the Aimco Operating Partnership | $ | 354 | $ | 714 |
Level 2 | Level 3 | ||||||||||||||||||
AFS (1) | IR swaps (2) | TRR swaps (3) | TRR debt (4) | Total | |||||||||||||||
Fair value at December 31, 2011 | $ | 51,693 | $ | (7,012 | ) | $ | (5,841 | ) | $ | 5,841 | $ | 44,681 | |||||||
Investment accretion | 1,516 | — | — | — | 1,516 | ||||||||||||||
Unrealized gains (losses) included in interest expense (5) | — | (24 | ) | 2,554 | (2,554 | ) | (24 | ) | |||||||||||
Losses on interest rate swaps reclassified into interest expense from accumulated other comprehensive loss | — | 840 | — | — | 840 | ||||||||||||||
Unrealized (losses) gains included in equity and partners’ capital | 1,459 | (1,774 | ) | — | — | (315 | ) | ||||||||||||
Fair value at June 30, 2012 | $ | 54,668 | $ | (7,970 | ) | $ | (3,287 | ) | $ | 3,287 | $ | 46,698 | |||||||
Fair value at December 31, 2012 | $ | 59,145 | $ | (7,968 | ) | $ | (2,581 | ) | $ | 2,581 | $ | 51,177 | |||||||
Investment accretion | 1,681 | — | — | — | 1,681 | ||||||||||||||
Unrealized gains (losses) included in interest expense (5) | — | (24 | ) | (1,134 | ) | 1,134 | (24 | ) | |||||||||||
Losses on interest rate swaps reclassified into interest expense from accumulated other comprehensive loss | — | 836 | — | — | 836 | ||||||||||||||
Unrealized (losses) gains included in equity and partners’ capital | (3,055 | ) | 1,608 | — | — | (1,447 | ) | ||||||||||||
Fair value at June 30, 2013 | $ | 57,771 | $ | (5,548 | ) | $ | (3,715 | ) | $ | 3,715 | $ | 52,223 |
(1) | Our investments classified as AFS are presented within other assets in the accompanying condensed consolidated balance sheets. We estimate the fair value of these investments using an income and market approach with primarily observable inputs, including yields and other information regarding similar types of investments, and adjusted for certain unobservable inputs specific to these investments. We are accreting the discount to the $100.9 million face value of the investments into interest income using the effective interest method over the remaining expected term of the investments, which, as of June 30, 2013, was approximately 7.9 years. Our amortized cost basis for these investments, which represents the original cost adjusted for interest accretion less interest payments received, was $58.0 million and $56.3 million at June 30, 2013 and December 31, 2012, respectively. Although the amortized cost exceeded the fair value of these investments at June 30, 2013, we currently expect to hold the investments to their maturity dates and we believe we will fully recover the investments. Accordingly, we believe the impairment in the fair value of these investments is temporary and we have not recognized any of the loss in value in earnings. |
(2) | The fair value of IR swaps is estimated using an income approach with primarily observable inputs including information regarding the hedged variable cash flows and forward yield curves relating to the variable interest rates on which the hedged cash flows are based. |
(3) | TRR swaps have contractually-defined termination values generally equal to the difference between the fair value and the counterparty’s purchased value of the underlying borrowings. We calculate the termination value, which we believe is representative of the fair value, of total rate of return swaps using a market approach by reference to estimates of the fair value of the underlying borrowings, which are discussed below, and an evaluation of potential changes in the credit quality of the counterparty to these arrangements. |
(4) | This represents changes in fair value of debt subject to TRR swaps. We estimate the fair value of debt instruments using an income and market approach, including comparison of the contractual terms to observable and unobservable inputs such as market interest rate risk spreads, contractual interest rates, remaining periods to maturity, collateral quality and loan-to-value ratios on similarly encumbered assets within our portfolio. We handle a large volume of financing transactions annually and use pricing information obtained during the financing process to evaluate market pricing information for reasonableness. |
(5) | Unrealized gains (losses) for the TRR swaps and TRR debt relate to periodic revaluations of fair value and are included in interest expense in the accompanying condensed consolidated statements of operations. |
2013 | 2012 | ||||
Number of properties encumbered by non-recourse property debt measured at fair value during period | 4 | 4 | |||
Weighted average interest rate | 5.9 | % | 5.8 | % | |
Weighted average maturity in years | 23.4 | 24.4 | |||
Weighted average loan-to-value ratio | 79.0 | % | 78.5 | % |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Numerator: | |||||||||||||||
Income (loss) from continuing operations | $ | 4,188 | $ | (7,481 | ) | $ | 4,831 | $ | (30,098 | ) | |||||
Income (loss) from continuing operations attributable to noncontrolling interests | (1,028 | ) | (3,916 | ) | (907 | ) | (4,394 | ) | |||||||
Income attributable to preferred stockholders | (701 | ) | (22,182 | ) | (1,403 | ) | (34,621 | ) | |||||||
Income attributable to participating securities | (140 | ) | (95 | ) | (280 | ) | (214 | ) | |||||||
Income (loss) from continuing operations attributable to Aimco common stockholders | $ | 2,319 | $ | (33,674 | ) | $ | 2,241 | $ | (69,327 | ) | |||||
Income from discontinued operations | $ | 2,791 | $ | 41,612 | $ | 4,981 | $ | 74,876 | |||||||
Loss (income) from discontinued operations attributable to noncontrolling interests | 4,997 | (7,415 | ) | 7,935 | (15,635 | ) | |||||||||
Income from discontinued operations attributable to Aimco common stockholders | $ | 7,788 | $ | 34,197 | $ | 12,916 | $ | 59,241 | |||||||
Net income | $ | 6,979 | $ | 34,131 | $ | 9,812 | $ | 44,778 | |||||||
Net loss (income) attributable to noncontrolling interests | 3,969 | (11,331 | ) | 7,028 | (20,029 | ) | |||||||||
Income attributable to preferred stockholders | (701 | ) | (22,182 | ) | (1,403 | ) | (34,621 | ) | |||||||
Income attributable to participating securities | (140 | ) | (95 | ) | (280 | ) | (214 | ) | |||||||
Net income (loss) attributable to Aimco common stockholders | $ | 10,107 | $ | 523 | $ | 15,157 | $ | (10,086 | ) | ||||||
Denominator: | |||||||||||||||
Denominator for basic earnings per share — weighted average number of shares of Common Stock outstanding | 145,321 | 127,395 | 145,245 | 123,960 | |||||||||||
Effect of dilutive securities: | |||||||||||||||
Dilutive potential common shares | 353 | — | 287 | — | |||||||||||
Denominator for diluted earnings per share | 145,674 | 127,395 | 145,532 | 123,960 | |||||||||||
Earnings (loss) per common share – basic and diluted: | |||||||||||||||
Income (loss) from continuing operations attributable to Aimco common stockholders | $ | 0.02 | $ | (0.26 | ) | $ | 0.01 | $ | (0.56 | ) | |||||
Income from discontinued operations attributable to Aimco common stockholders | 0.05 | 0.26 | 0.09 | 0.48 | |||||||||||
Net income (loss) attributable to Aimco common stockholders | $ | 0.07 | $ | — | $ | 0.10 | $ | (0.08 | ) |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Numerator: | |||||||||||||||
Income (loss) from continuing operations | $ | 4,188 | $ | (7,481 | ) | $ | 4,831 | $ | (30,098 | ) | |||||
Loss (income) from continuing operations attributable to noncontrolling interests | 698 | (4,512 | ) | 2,439 | (5,746 | ) | |||||||||
Income attributable to the Aimco Operating Partnership’s preferred unitholders | (2,307 | ) | (23,793 | ) | (4,615 | ) | (37,902 | ) | |||||||
Income attributable to participating securities | (140 | ) | (95 | ) | (280 | ) | (214 | ) | |||||||
Income (loss) from continuing operations attributable to the Aimco Operating Partnership’s common unitholders | $ | 2,439 | $ | (35,881 | ) | $ | 2,375 | $ | (73,960 | ) | |||||
Income from discontinued operations | $ | 2,791 | $ | 41,612 | $ | 4,981 | $ | 74,876 | |||||||
Loss (income) from discontinued operations attributable to noncontrolling interests | 5,452 | (5,153 | ) | 8,673 | (11,684 | ) | |||||||||
Income from discontinued operations attributable to the Aimco Operating Partnership’s common unitholders | $ | 8,243 | $ | 36,459 | $ | 13,654 | $ | 63,192 | |||||||
Net income | $ | 6,979 | $ | 34,131 | $ | 9,812 | $ | 44,778 | |||||||
Net loss (income) attributable to noncontrolling interests | 6,150 | (9,665 | ) | 11,112 | (17,430 | ) | |||||||||
Income attributable to the Aimco Operating Partnership’s preferred unitholders | (2,307 | ) | (23,793 | ) | (4,615 | ) | (37,902 | ) | |||||||
Income attributable to participating securities | (140 | ) | (95 | ) | (280 | ) | (214 | ) | |||||||
Net income (loss) attributable to the Aimco Operating Partnership’s common unitholders | $ | 10,682 | $ | 578 | $ | 16,029 | $ | (10,768 | ) | ||||||
Denominator: | |||||||||||||||
Denominator for basic earnings per unit — weighted average number of common units outstanding | 153,294 | 135,622 | 153,217 | 132,159 | |||||||||||
Effect of dilutive securities: | |||||||||||||||
Dilutive potential common units | 353 | — | 287 | — | |||||||||||
Denominator for diluted earnings per unit | 153,647 | 135,622 | 153,504 | 132,159 | |||||||||||
Earnings (loss) per common unit – basic and diluted: | |||||||||||||||
Income (loss) from continuing operations attributable to the Aimco Operating Partnership’s common unitholders | $ | 0.02 | $ | (0.26 | ) | $ | 0.01 | $ | (0.56 | ) | |||||
Income from discontinued operations attributable to the Aimco Operating Partnership’s common unitholders | 0.05 | 0.26 | 0.09 | 0.48 | |||||||||||
Net income (loss) attributable to the Aimco Operating Partnership’s common unitholders | $ | 0.07 | $ | — | $ | 0.10 | $ | (0.08 | ) |
Conventional Real Estate Operations | Affordable Real Estate Operations | Proportionate Adjustments (1) | Corporate and Amounts Not Allocated to Segments | Consolidated | |||||||||||||||
Three Months Ended June 30, 2013: | |||||||||||||||||||
Rental and other property revenues (2) | $ | 213,331 | $ | 25,494 | $ | 13,008 | $ | 20 | $ | 251,853 | |||||||||
Tax credit and asset management revenues | — | — | — | 7,809 | 7,809 | ||||||||||||||
Total revenues | 213,331 | 25,494 | 13,008 | 7,829 | 259,662 | ||||||||||||||
Property operating expenses (2) | 77,606 | 10,123 | 4,806 | 9,182 | 101,717 | ||||||||||||||
Investment management expenses | — | — | — | 1,697 | 1,697 | ||||||||||||||
Depreciation and amortization (2) | — | — | — | 78,345 | 78,345 | ||||||||||||||
General and administrative expenses | — | — | — | 11,153 | 11,153 | ||||||||||||||
Other expenses, net | — | — | — | 2,226 | 2,226 | ||||||||||||||
Total operating expenses | 77,606 | 10,123 | 4,806 | 102,603 | 195,138 | ||||||||||||||
Net operating income (loss) | 135,725 | 15,371 | 8,202 | (94,774 | ) | 64,524 | |||||||||||||
Other items included in continuing operations | — | — | — | (60,336 | ) | (60,336 | ) | ||||||||||||
Income (loss) from continuing operations | $ | 135,725 | $ | 15,371 | $ | 8,202 | $ | (155,110 | ) | $ | 4,188 |
Conventional Real Estate Operations | Affordable Real Estate Operations | Proportionate Adjustments (1) | Corporate and Amounts Not Allocated to Segments | Consolidated | |||||||||||||||
Three Months Ended June 30, 2012: | |||||||||||||||||||
Rental and other property revenues (2) | $ | 200,795 | $ | 25,162 | $ | 18,301 | $ | 116 | $ | 244,374 | |||||||||
Tax credit and asset management revenues | — | — | — | 8,914 | 8,914 | ||||||||||||||
Total revenues | 200,795 | 25,162 | 18,301 | 9,030 | 253,288 | ||||||||||||||
Property operating expenses (2) | 72,947 | 9,808 | 8,355 | 8,697 | 99,807 | ||||||||||||||
Investment management expenses | — | — | — | 3,240 | 3,240 | ||||||||||||||
Depreciation and amortization (2) | — | — | — | 87,229 | 87,229 | ||||||||||||||
Provision for real estate impairment losses (2) | — | — | — | 2,275 | 2,275 | ||||||||||||||
General and administrative expenses | — | — | — | 13,556 | 13,556 | ||||||||||||||
Other expenses, net | — | — | — | (957 | ) | (957 | ) | ||||||||||||
Total operating expenses | 72,947 | 9,808 | 8,355 | 114,040 | 205,150 | ||||||||||||||
Net operating income (loss) | 127,848 | 15,354 | 9,946 | (105,010 | ) | 48,138 | |||||||||||||
Other items included in continuing operations | — | — | — | (55,619 | ) | (55,619 | ) | ||||||||||||
Income (loss) from continuing operations | $ | 127,848 | $ | 15,354 | $ | 9,946 | $ | (160,629 | ) | $ | (7,481 | ) |
Conventional Real Estate Operations | Affordable Real Estate Operations | Proportionate Adjustments (1) | Corporate and Amounts Not Allocated to Segments | Consolidated | |||||||||||||||
Six Months Ended June 30, 2013: | |||||||||||||||||||
Rental and other property revenues (2) | $ | 422,830 | $ | 50,876 | $ | 25,951 | $ | 43 | $ | 499,700 | |||||||||
Tax credit and asset management revenues | — | — | — | 15,061 | 15,061 | ||||||||||||||
Total revenues | 422,830 | 50,876 | 25,951 | 15,104 | 514,761 | ||||||||||||||
Property operating expenses (2) | 154,933 | 20,682 | 9,706 | 18,099 | 203,420 | ||||||||||||||
Investment management expenses | — | — | — | 3,130 | 3,130 | ||||||||||||||
Depreciation and amortization (2) | — | — | — | 158,618 | 158,618 | ||||||||||||||
General and administrative expenses | — | — | — | 22,932 | 22,932 | ||||||||||||||
Other expenses, net | — | — | — | 4,436 | 4,436 | ||||||||||||||
Total operating expenses | 154,933 | 20,682 | 9,706 | 207,215 | 392,536 | ||||||||||||||
Net operating income (loss) | 267,897 | 30,194 | 16,245 | (192,111 | ) | 122,225 | |||||||||||||
Other items included in continuing operations | — | — | — | (117,394 | ) | (117,394 | ) | ||||||||||||
Income (loss) from continuing operations | $ | 267,897 | $ | 30,194 | $ | 16,245 | $ | (309,505 | ) | $ | 4,831 |
Conventional Real Estate Operations | Affordable Real Estate Operations | Proportionate Adjustments (1) | Corporate and Amounts Not Allocated to Segments | Consolidated | |||||||||||||||
Six Months Ended June 30, 2012: | |||||||||||||||||||
Rental and other property revenues (2) | $ | 398,360 | $ | 50,092 | $ | 39,576 | $ | 251 | $ | 488,279 | |||||||||
Tax credit and asset management revenues | — | — | — | 16,985 | 16,985 | ||||||||||||||
Total revenues | 398,360 | 50,092 | 39,576 | 17,236 | 505,264 | ||||||||||||||
Property operating expenses (2) | 145,564 | 19,751 | 15,386 | 17,717 | 198,418 | ||||||||||||||
Investment management expenses | — | — | — | 6,628 | 6,628 | ||||||||||||||
Depreciation and amortization (2) | — | — | — | 173,795 | 173,795 | ||||||||||||||
Provision for real estate impairment losses (2) | — | — | — | 8,349 | 8,349 | ||||||||||||||
General and administrative expenses | — | — | — | 25,181 | 25,181 | ||||||||||||||
Other expenses, net | — | — | — | 4,772 | 4,772 | ||||||||||||||
Total operating expenses | 145,564 | 19,751 | 15,386 | 236,442 | 417,143 | ||||||||||||||
Net operating income (loss) | 252,796 | 30,341 | 24,190 | (219,206 | ) | 88,121 | |||||||||||||
Other items included in continuing operations | — | — | — | (118,219 | ) | (118,219 | ) | ||||||||||||
Income (loss) from continuing operations | $ | 252,796 | $ | 30,341 | $ | 24,190 | $ | (337,425 | ) | $ | (30,098 | ) |
(1) | Represents adjustments for the noncontrolling interests in consolidated real estate partnerships’ share of the results of our consolidated properties and the results of consolidated properties that we do not manage, which are excluded from our measurement of segment performance but included in the related consolidated amounts, and our share of the results of operations of our unconsolidated real estate partnerships that we manage, which are included in our measurement of segment performance but excluded from the related consolidated amounts. |
(2) | Proportionate property net operating income, our key measurement of segment profit or loss excludes property management revenues (which are included in rental and other property revenues), property management expenses and casualty gains and losses (which are included in property operating expenses) and depreciation and amortization and provision for real estate impairment losses. Accordingly, we do not allocate these amounts to our segments. |
ITEM 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
• | operate our portfolio of desirable apartment homes with valued amenities and with a high level of customer service and in an efficient manner that realizes the benefits of our local management expertise; |
• | improve our geographically diversified portfolio of market-rate apartment properties, which average “B/B+” in quality (defined below) by selling properties inconsistent with our portfolio strategy and investing the proceeds from such sales through redevelopment and acquisition of higher-quality properties; and |
• | provide financial leverage primarily by the use of non-recourse, long-dated, fixed-rate property debt and perpetual preferred equity, a combination which helps to limit our refunding and re-pricing risk and provides a hedge against increases in interest rates, capitalization rates and inflation. |
Trailing Twelve Months Ended June 30, | Annualized Three Months Ended June 30, | ||||||
2013 | 2012 | 2013 | 2012 | ||||
Debt to Proportionate EBITDA | 7.8x | 8.3x | 7.9x | 8.0x | |||
Debt and Preferred Equity to Proportionate EBITDA | 8.0x | 8.6x | 8.1x | 8.2x | |||
Proportionate EBITDA Coverage of Interest | 2.5x | 2.2x | 2.5x | 2.3x | |||
Proportionate EBITDA Coverage of Interest and Preferred Dividends | 2.4x | 1.8x | 2.4x | 1.9x |
• | Conventional Same Store revenues and expenses for the three months ended June 30, 2013, increased by 5.1% and 4.8%, respectively, resulting in a 5.3% increase in net operating income as compared to the three months ended June 30, 2012; |
• | Average revenue per apartment home for our Conventional properties increased by 7.4%, from $1,293 for the three months ended June 30, 2012 to $1,389 for the three months ended June 30, 2013. |
• | Net operating income for our total real estate portfolio (continuing operations) for the three months ended June 30, 2013, increased 5.5% as compared to the three months ended June 30, 2012. |
Three Months Ended June 30, | ||||||||||||||
2013 | 2012 | $ Change | % Change | |||||||||||
Rental and other property revenues: | ||||||||||||||
Conventional Same Store | $ | 192,032 | $ | 182,682 | $ | 9,350 | 5.1 | % | ||||||
Other Conventional | 21,299 | 18,113 | 3,186 | 17.6 | % | |||||||||
Total | 213,331 | 200,795 | 12,536 | 6.2 | % | |||||||||
Property operating expenses: | ||||||||||||||
Conventional Same Store | 67,398 | 64,305 | 3,093 | 4.8 | % | |||||||||
Other Conventional | 10,208 | 8,642 | 1,566 | 18.1 | % | |||||||||
Total | 77,606 | 72,947 | 4,659 | 6.4 | % | |||||||||
Property net operating income: | ||||||||||||||
Conventional Same Store | 124,634 | 118,377 | 6,257 | 5.3 | % | |||||||||
Other Conventional | 11,091 | 9,471 | 1,620 | 17.1 | % | |||||||||
Total | $ | 135,725 | $ | 127,848 | $ | 7,877 | 6.2 | % |
Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | $ Change | % Change | |||||||||||
Rental and other property revenues: | ||||||||||||||
Conventional same store | $ | 381,053 | $ | 363,257 | $ | 17,796 | 4.9 | % | ||||||
Other Conventional | 41,777 | 35,103 | 6,674 | 19.0 | % | |||||||||
Total | 422,830 | 398,360 | 24,470 | 6.1 | % | |||||||||
Property operating expenses: | ||||||||||||||
Conventional same store | 134,684 | 128,290 | 6,394 | 5.0 | % | |||||||||
Other Conventional | 20,249 | 17,274 | 2,975 | 17.2 | % | |||||||||
Total | 154,933 | 145,564 | 9,369 | 6.4 | % | |||||||||
Property net operating income: | ||||||||||||||
Conventional same store | 246,369 | 234,967 | 11,402 | 4.9 | % | |||||||||
Other Conventional | 21,528 | 17,829 | 3,699 | 20.7 | % | |||||||||
Total | $ | 267,897 | $ | 252,796 | $ | 15,101 | 6.0 | % |
Three Months Ended June 30, | ||||||||||||||
2013 | 2012 | $ Change | % Change | |||||||||||
Rental and other property revenues: | ||||||||||||||
Affordable Same Store | $ | 21,202 | $ | 20,979 | $ | 223 | 1.1 | % | ||||||
Other Affordable | 4,292 | 4,183 | 109 | 2.6 | % | |||||||||
Total | 25,494 | 25,162 | 332 | 1.3 | % | |||||||||
Property operating expenses: | ||||||||||||||
Affordable Same Store | 8,406 | 8,035 | 371 | 4.6 | % | |||||||||
Other Affordable | 1,717 | 1,773 | (56 | ) | (3.2 | )% | ||||||||
Total | 10,123 | 9,808 | 315 | 3.2 | % | |||||||||
Property net operating income: | ||||||||||||||
Affordable Same Store | 12,796 | 12,944 | (148 | ) | (1.1 | )% | ||||||||
Other Affordable | 2,575 | 2,410 | 165 | 6.8 | % | |||||||||
Total | $ | 15,371 | $ | 15,354 | $ | 17 | 0.1 | % |
Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | $ Change | % Change | |||||||||||
Rental and other property revenues: | ||||||||||||||
Affordable same store | $ | 42,400 | $ | 41,717 | $ | 683 | 1.6 | % | ||||||
Other Affordable | 8,476 | 8,375 | 101 | 1.2 | % | |||||||||
Total | 50,876 | 50,092 | 784 | 1.6 | % | |||||||||
Property operating expenses: | ||||||||||||||
Affordable same store | 17,090 | 16,283 | 807 | 5.0 | % | |||||||||
Other Affordable | 3,592 | 3,468 | 124 | 3.6 | % | |||||||||
Total | 20,682 | 19,751 | 931 | 4.7 | % | |||||||||
Property net operating income: | ||||||||||||||
Affordable same store | 25,310 | 25,434 | (124 | ) | (0.5 | )% | ||||||||
Other Affordable | 4,884 | 4,907 | (23 | ) | (0.5 | )% | ||||||||
Total | $ | 30,194 | $ | 30,341 | $ | (147 | ) | (0.5 | )% |
• | the general economic climate; |
• | competition from other apartment communities and other housing options; |
• | local conditions, such as loss of jobs or an increase in the supply of apartments, that might adversely affect apartment occupancy or rental rates; |
• | changes in governmental regulations and the related cost of compliance; |
• | increases in operating costs (including real estate taxes) due to inflation and other factors, which may not be offset by increased rents; |
• | changes in tax laws and housing laws, including the enactment of rent control laws or other laws regulating multifamily housing; and |
• | changes in interest rates and the availability of financing. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Net income (loss) attributable to Aimco common stockholders (1) | $ | 10,107 | $ | 523 | $ | 15,157 | $ | (10,086 | ) | ||||||
Adjustments: | |||||||||||||||
Depreciation and amortization | 78,345 | 87,229 | 158,618 | 173,795 | |||||||||||
Depreciation and amortization related to non-real estate assets | (2,968 | ) | (3,314 | ) | (5,937 | ) | (6,554 | ) | |||||||
Depreciation of rental property related to noncontrolling partners and unconsolidated entities | (2,828 | ) | (4,685 | ) | (5,991 | ) | (9,562 | ) | |||||||
Loss (gain) on dispositions and other, net of noncontrolling partners' interest | 290 | (300 | ) | 361 | (313 | ) | |||||||||
Impairment losses related to depreciable real estate assets, net of noncontrolling partners' interest | — | 2,482 | 37 | 8,079 | |||||||||||
Discontinued operations: | |||||||||||||||
Gain on dispositions of real estate, net of income taxes and noncontrolling partners' interest | (7,518 | ) | (40,542 | ) | (12,597 | ) | (68,707 | ) | |||||||
(Recovery of) provision for impairment losses related to depreciable real estate assets, net of noncontrolling partners' interest | (729 | ) | 4,363 | (963 | ) | 4,684 | |||||||||
Depreciation of rental property, net of noncontrolling partners' interest | 10 | 5,974 | 59 | 13,073 | |||||||||||
Common noncontrolling interests in Aimco Operating Partnership's share of above adjustments | (3,478 | ) | (3,225 | ) | (7,224 | ) | (7,386 | ) | |||||||
Amounts allocable to participating securities | (145 | ) | (101 | ) | (293 | ) | (238 | ) | |||||||
FFO Attributable to Aimco Common Stockholders - Diluted | $ | 71,086 | $ | 48,404 | $ | 141,227 | $ | 96,785 | |||||||
Preferred equity redemption related amounts | — | 10,530 | — | 10,530 | |||||||||||
Common noncontrolling interests in Aimco Operating Partnership's share of above adjustments | — | (679 | ) | — | (679 | ) | |||||||||
Amounts allocable to participating securities | — | (40 | ) | — | (46 | ) | |||||||||
Pro forma Funds From Operations Attributable to Aimco Common Stockholders - Diluted | $ | 71,086 | $ | 58,215 | $ | 141,227 | $ | 106,590 | |||||||
Capital Replacements, net of common noncontrolling interests in Aimco Operating Partnership | (17,760 | ) | (15,084 | ) | (32,947 | ) | (28,380 | ) | |||||||
Amounts allocable to participating securities | 71 | 57 | 134 | 131 | |||||||||||
AFFO attributable to Aimco common stockholders – Diluted | $ | 53,397 | $ | 43,188 | $ | 108,414 | $ | 78,341 | |||||||
Weighted average common shares outstanding – diluted (earnings per share) | 145,674 | 127,395 | 145,532 | 123,960 | |||||||||||
Dilutive common share equivalents | — | 412 | — | 377 | |||||||||||
Weighted average common shares outstanding – diluted (FFO, Pro forma FFO and AFFO) (2) | 145,674 | 127,807 | 145,532 | 124,337 |
(1) | Represents the numerator for calculating Aimco’s earnings per common share in accordance with GAAP (see Note 9 to the condensed consolidated financial statements in Item 1). |
(2) | Represents the denominator for Aimco’s earnings per common share – diluted, calculated in accordance with GAAP, plus common share equivalents that are dilutive for FFO, Pro forma FFO and AFFO. |
2013 | 2012 | ||||||
Capital Replacements: | |||||||
Standard | $ | 20,646 | $ | 25,776 | |||
Multi-phase projects | 11,558 | — | |||||
Property Upgrades | 14,333 | 19,206 | |||||
Capital Improvements | 29,243 | 11,294 | |||||
Redevelopment additions | 72,575 | 40,217 | |||||
Casualty replacements | 5,295 | 3,964 | |||||
Total capital additions | 153,650 | 100,457 | |||||
Less: additions related to unconsolidated partnerships | (5 | ) | (461 | ) | |||
Plus: additions related to sold or held for sale properties | — | 10,985 | |||||
Plus: additions related to consolidated properties not managed, commercial space, fitness facilities and other | 155 | 478 | |||||
Consolidated capital additions | 153,800 | 111,459 | |||||
Plus: net change in accrued capital spending | 9,568 | 5,972 | |||||
Capital expenditures per consolidated statement of cash flows | $ | 163,368 | $ | 117,431 |
Anticipated Schedule | ||||||||||||
Total Number of Units | Estimated Total Project Cost | Inception-to-Date Investment | Construction Start | Initial Occupancy | Construction Complete | Stabilized Operations | ||||||
Elm Creek, Elmhurst, IL | 28 | $ | 11.5 | $ | 9.1 | 2Q 2012 | 1Q 2013 | 4Q 2013 | 1Q 2014 | |||
Lincoln Place, Venice, CA | 795 | 328.0 | 234.1 | Multiple | Multiple | 4Q 2014 | 1Q 2015 | |||||
Pacific Bay Vistas, San Bruno, CA | 308 | 121.1 | 89.5 | 4Q 2011 | 3Q 2013 | 2Q 2014 | 3Q 2014 | |||||
The Palazzo at Park La Brea, Los Angeles, CA | 521 | 15.7 | 8.3 | 1Q 2012 | 4Q 2012 | 3Q 2014 | 4Q 2014 | |||||
The Preserve at Marin, Corte Madera, CA | 126 | 85.0 | 67.1 | 4Q 2012 | 4Q 2013 | 3Q 2014 | 4Q 2014 | |||||
Total | 1,778 | $ | 561.3 | $ | 408.1 |
ITEM 3. | Quantitative and Qualitative Disclosures About Market Risk |
ITEM 4. | Controls and Procedures |
ITEM 1A. | Risk Factors |
ITEM 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Period | Total Number of Units Purchased | Average Price Paid per Unit | Total Number of Units Purchased as Part of Publicly Announced Plans or Programs (1) | Maximum Number of Units that May Yet Be Purchased Under the Plans or Programs (1) | |||||||
April 1– April 30, 2013 | 24,532 | $ | 31.04 | N/A | N/A | ||||||
May 1 – May 31, 2013 | 17,670 | 31.02 | N/A | N/A | |||||||
June 1 – June 30, 2013 | 2,312 | 31.91 | N/A | N/A | |||||||
Total | 44,514 | $ | 31.08 |
(1) | The terms of the Aimco Operating Partnership’s Partnership Agreement do not provide for a maximum number of units that may be repurchased, and other than the express terms of its Partnership Agreement, the Aimco Operating Partnership has no publicly announced plans or programs of repurchase. However, whenever Aimco repurchases shares of its Common Stock, it is expected that Aimco will fund the repurchase with proceeds from a concurrent repurchase by the Aimco Operating Partnership of common OP Units held by Aimco at a price per unit that is equal to the price per share paid for its Common Stock. |
ITEM 6. | Exhibits |
EXHIBIT NO. (1) | DESCRIPTION | ||
3.1 | Aimco – Charter (Exhibit 3.1 to Aimco’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2012, is incorporated herein by this reference) | ||
3.2 | Aimco – Amended and Restated Bylaws (Exhibit 3.2 to Aimco’s Current Report on Form 8-K dated February 2, 2010, is incorporated herein by this reference) | ||
31.1 | Aimco – Certification of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
31.2 | Aimco – Certification of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
31.3 | The Aimco Operating Partnership – Certification of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
31.4 | The Aimco Operating Partnership – Certification of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ||
32.1 | Aimco – Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | ||
32.2 | Aimco – Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | ||
32.3 | The Aimco Operating Partnership – Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | ||
32.4 | The Aimco Operating Partnership – Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | ||
99.1 | Aimco – Agreement Regarding Disclosure of Long-Term Debt Instruments | ||
99.2 | The Aimco Operating Partnership – Agreement Regarding Disclosure of Long-Term Debt Instruments | ||
101 | XBRL (Extensible Business Reporting Language). The following materials from Aimco’s and the Aimco Operating Partnership’s combined Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2013, tagged in XBRL: (i) condensed consolidated balance sheets; (ii) condensed consolidated statements of operations; (iii) condensed consolidated statements of comprehensive income (loss); (iv) condensed consolidated statements of cash flows; and (v) notes to condensed consolidated financial statements. | ||
(1) | Schedules and supplemental materials to the exhibits have been omitted but will be provided to the Securities and Exchange Commission upon request. |
APARTMENT INVESTMENT AND MANAGEMENT COMPANY | |
By: | /s/ ERNEST M. FREEDMAN |
Ernest M. Freedman | |
Executive Vice President and Chief Financial Officer | |
(duly authorized officer and | |
principal financial officer) | |
By: | /s/ PAUL BELDIN |
Paul Beldin | |
Senior Vice President and | |
Chief Accounting Officer |
AIMCO PROPERTIES, L.P. | |
By: | AIMCO-GP, Inc., its general partner |
By: | /s/ ERNEST M. FREEDMAN |
Ernest M. Freedman | |
Executive Vice President and Chief Financial Officer | |
(duly authorized officer and | |
principal financial officer) | |
By: | /s/ PAUL BELDIN |
Paul Beldin | |
Senior Vice President and | |
Chief Accounting Officer |
1. | I have reviewed this quarterly report on Form 10-Q of Apartment Investment and Management Company; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Terry Considine | |
Terry Considine | |
Chairman and Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of Apartment Investment and Management Company; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Ernest M. Freedman | |
Ernest M. Freedman | |
Executive Vice President and Chief | |
Financial Officer |
1. | I have reviewed this quarterly report on Form 10-Q of AIMCO Properties, L.P.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Terry Considine | |
Terry Considine | |
Chairman and Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of AIMCO Properties, L.P.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ Ernest M. Freedman | |
Ernest M. Freedman | |
Executive Vice President and Chief Financial Officer |
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Terry Considine | |
Terry Considine | |
Chairman and Chief Executive Officer | |
August 2, 2013 |
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Ernest M. Freedman | |
Ernest M. Freedman | |
Executive Vice President and Chief Financial Officer | |
August 2, 2013 |
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Terry Considine | |
Terry Considine | |
Chairman and Chief Executive Officer | |
August 2, 2013 |
(1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Ernest M. Freedman | |
Ernest M. Freedman | |
Executive Vice President and Chief Financial Officer | |
August 2, 2013 |
By: | /s/ Ernest M. Freedman |
Ernest M. Freedman | |
Executive Vice President and Chief Financial Officer | |
August 2, 2013 |
By: | /s/ Ernest M. Freedman |
Ernest M. Freedman | |
Executive Vice President and Chief | |
Financial Officer | |
August 2, 2013 |
Business Segments
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Segments | NOTE 10 — Business Segments We have two reportable segments: conventional real estate operations and affordable real estate operations. Our conventional real estate operations consist of market-rate apartments with rents paid by the residents and included 176 properties with 55,965 units at June 30, 2013. Our affordable real estate operations consisted of 82 properties with 11,212 units at June 30, 2013, with rents that are generally paid, in whole or part, by a government agency. Our chief executive officer, who is our chief operating decision maker, uses various generally accepted industry financial measures to assess the performance and financial condition of the business, including: Net Asset Value, which is the estimated fair value of our assets, net of liabilities and preferred equity; Funds From Operations, which represents net income or loss computed in accordance with GAAP, excluding gains from sales of, and impairment losses recognized with respect to, depreciable property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures; Pro forma Funds From Operations, which is Funds From Operations excluding preferred equity redemption related amounts; Adjusted Funds From Operations, which is Pro forma Funds From Operations less spending for Capital Replacements, which represents our estimation of the capital additions required to maintain the value of our portfolio during our ownership period; property net operating income, which is rental and other property revenues less direct property operating expenses, including real estate taxes; proportionate property net operating income, which reflects our share of property net operating income of the consolidated and unconsolidated properties that we own and manage; same store property operating results; Free Cash Flow, which is net operating income less spending for Capital Replacements; Free Cash Flow internal rate of return; financial coverage ratios; and leverage as shown on our balance sheet. Our chief operating decision maker emphasizes proportionate property net operating income as a key measurement of segment profit or loss. The following tables present the revenues, net operating income (loss) and income (loss) from continuing operations of our conventional and affordable real estate operations segments on a proportionate basis for the three months ended June 30, 2013 and 2012 (in thousands):
For the six months ended June 30, 2013 and 2012, capital additions related to our conventional segment totaled $149.0 million and $103.7 million, respectively, and capital additions related to our affordable segment totaled $4.8 million and $7.8 million, respectively. |
Other Significant Transactions
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Other Significant Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Significant Transactions | NOTE 4 — Other Significant Transactions Investments in Real Estate Properties During the three months ended June 30, 2013, we acquired for $29.0 million a 60-unit property located in La Jolla, California. In connection with this acquisition, we assumed non-recourse property debt with an outstanding principal balance of $12.4 million and a fair value of $14.8 million, resulting in a total fair value of $31.3 million allocated to real estate. Purchase of West Harlem Property Loans In 2006, we funded $100.1 million of second mortgage loans related to 84 buildings containing 1,596 residential units and 43 commercial spaces in the West Harlem neighborhood of New York City. We concurrently entered into an agreement with the borrower under which we had the right to purchase the buildings and the borrower had the right to put the buildings to us upon achievement of certain revenue thresholds. At June 30, 2013 and December 31, 2012, the aggregate carrying amount of these second mortgage loans and the purchase option, which are included in notes receivable and other assets in our condensed consolidated balance sheets, totaled $110.2 million and $110.5 million, respectively. During the three months ended June 30, 2013, we purchased at par first mortgage loans secured by the same 84 buildings for $119.1 million, the majority of which matured on June 1, 2013. The loans bear interest at a weighted average rate of 5.2%. In conjunction with the acquisition of the first mortgage loans, the borrower agreed to repay all loans on or before November 22, 2013 and to pay us the value of our unexercised option to acquire the properties and to terminate its right to put the properties to us. Acquisitions of Noncontrolling Partnership Interests During the three months ended June 30, 2013, we acquired for $10.7 million the remaining noncontrolling limited partner interests in one consolidated real estate partnership that owns two properties in which we serve as general partner. The noncontrolling interest balance attributed to these limited partners was in a deficit position at the time of acquisition.The excess of the consideration paid over the carrying amount of the noncontrolling interests we acquired is reflected as an adjustment of additional paid-in capital within Aimco's equity and the Aimco Operating Partnership's partners' capital (see equity and partners' capital reconciliations in Note 2). The estimated fair value of the real estate corresponding to the interests we acquired totaled $21.0 million. Asset Management Business Disposition In December 2012, we closed the sale of the Napico portfolio, our legacy asset management business. The transaction was primarily seller-financed, and the associated notes are scheduled to be repaid over six years. The notes will be repaid from the operation and liquidation of the Napico portfolio and are collateralized by the buyer’s interests in the portfolio. In accordance with the provisions of GAAP applicable to sales of real estate or interests therein, for accounting purposes, we have not recognized a sale and will account for the transaction under the profit sharing method. Under this method, until full payment has been received for the seller-financed notes, we will continue to recognize the portfolio’s assets and liabilities, each condensed into single line items within other assets and accrued liabilities and other, respectively, in our consolidated balance sheets for all dates following the transaction. Similarly, we will continue to recognize the portfolio’s results of operations, also condensed into a single line item within our consolidated statements of operations, for periods subsequent to the transaction. Any cash payments we receive under the sale and related financing will be reflected as deferred income in our consolidated balance sheets until full payment has been received for the seller-financed notes. At June 30, 2013, the Napico portfolio consisted of 20 partnerships that held investments in 17 apartment properties that were consolidated and 92 apartment properties that were accounted for under the equity or cost method of accounting. The portfolio’s assets and liabilities included in our condensed consolidated balance sheets are summarized below (in thousands):
Summarized information regarding the Napico portfolio's results of operations, including any expense we recognize under the profit sharing method is shown below and is included in loss on dispositions and other in our condensed consolidated statement of operations (in thousands):
Based on our limited historical economic ownership in this portfolio, a significant portion of the assets and liabilities and results of operations shown are attributable to noncontrolling interests and do not significantly affect consolidated equity, partners’ capital and income or loss attributable to Aimco or the Aimco Operating Partnership. At June 30, 2013 and December 31, 2012, noncontrolling interests in consolidated real estate partnerships within our consolidated balance sheet included $52.8 million and $57.2 million, respectively, related to the Napico portfolio. Income or loss attributable to these noncontrolling interests will continue to be recognized commensurate with the recognition of the results of operations of the portfolio. If full payment is received on the notes and we meet the requirements to recognize the sale for accounting purposes, we expect to recognize a gain attributable to Aimco and the Aimco Operating Partnership. |
Other Significant Transactions (Tables)
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Other Significant Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Financial Position Related to Legally Sold Portfolio [Table Text Block] |
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Statement of Income Related to Legally Sold Portfolio [Table Text Block] |
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Basis of Presentation and Summary of Significant Accounting Policies (Policies)
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP, have been condensed or omitted in accordance with such rules and regulations, although management believes the disclosures are adequate to prevent the information presented from being misleading. In the opinion of management, all adjustments (consisting of normal recurring items) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2013, are not necessarily indicative of the results that may be expected for the year ending December 31, 2013. The balance sheets of Aimco and the Aimco Operating Partnership at December 31, 2012, have been derived from their audited financial statements at that date, but do not include all of the information and disclosures required by GAAP for complete financial statements. For further information, refer to the financial statements and notes thereto included in Aimco’s and the Aimco Operating Partnership’s combined Annual Report on Form 10-K for the year ended December 31, 2012. Certain 2012 financial statement amounts have been reclassified to conform to the 2013 presentation, including adjustments for discontinued operations. Except where indicated, the footnotes refer to both Aimco and the Aimco Operating Partnership. |
Principles of Consolidation | Principles of Consolidation Aimco’s accompanying condensed consolidated financial statements include the accounts of Aimco, the Aimco Operating Partnership, and their consolidated subsidiaries. The Aimco Operating Partnership’s condensed consolidated financial statements include the accounts of the Aimco Operating Partnership and its consolidated entities. We consolidate all variable interest entities for which we are the primary beneficiary. Generally, a variable interest entity, or VIE, is a legal entity in which the equity investors do not have the characteristics of a controlling financial interest or the equity investors lack sufficient equity at risk for the entity to finance its activities without additional subordinated financial support. In determining whether we are the primary beneficiary of a VIE, we consider qualitative and quantitative factors, including, but not limited to: which activities most significantly impact the VIE’s economic performance and which party controls such activities; the amount and characteristics of our investment; the obligation or likelihood for us or other investors to provide financial support; and the similarity with and significance to the business activities of us and the other investors. Significant judgments related to these determinations include estimates about the current and future fair values and performance of real estate held by these VIEs and general market conditions. Refer to Note 5 for further information regarding our involvement with VIEs. Generally, we consolidate real estate partnerships and other entities that are not variable interest entities when we own, directly or indirectly, a majority voting interest in the entity or are otherwise able to control the entity. All significant intercompany balances and transactions have been eliminated in consolidation. Interests in the Aimco Operating Partnership that are held by limited partners other than Aimco are reflected in Aimco’s accompanying balance sheets as noncontrolling interests in Aimco Operating Partnership. Interests in partnerships consolidated into the Aimco Operating Partnership that are held by third parties are reflected in our accompanying balance sheets as noncontrolling interests in consolidated real estate partnerships. The assets of consolidated real estate partnerships owned or controlled by the Aimco Operating Partnership generally are not available to pay creditors of Aimco or the Aimco Operating Partnership. As used herein, and except where the context otherwise requires, “partnership” refers to a limited partnership or a limited liability company and “partner” refers to a partner in a limited partnership or a member in a limited liability company. |
Temporary Equity and Partners' Capital | These amounts are presented within temporary equity in Aimco’s condensed consolidated balance sheets as preferred noncontrolling interests in the Aimco Operating Partnership, and within temporary capital in the Aimco Operating Partnership’s condensed consolidated balance sheets as redeemable preferred units. |
Use of Estimates | Use of Estimates The preparation of our condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts included in the financial statements and accompanying notes thereto. Actual results could differ from those estimates. |
Notes Receivable (Details Textual) (USD $)
In Millions, unless otherwise specified |
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Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Notes Receivable Interest Rate Stated Percentage | 2.30% | 6.50% | 4.30% | ||
Notes Receivable (Textual) [Abstract] | |||||
Notes receivable secured by interests in real estate or interests in real estate partnerships | $ 216.1 | $ 101.3 |
Other Significant Transactions Details 2 (Details) (USD $)
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Statement of Income Related to Legally Sold Portfolio [Line Items] | ||
Revenues | $ 7,395 | $ 13,333 |
Expenses | (5,667) | (11,935) |
Equity in earnings or loss of unconsolidated entities, gains or losses on dispositions and other, net | (2,997) | (4,094) |
Net loss related to legacy asset management business | (1,269) | (2,696) |
Noncontrolling interests in consolidated real estate partnerships | 1,623 | 3,410 |
Net income of legacy asset management business attributable to Aimco and the Aimco Operating Partnership | $ 354 | $ 714 |
Notes Receivable (Tables)
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Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] |
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Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] |
|
Earnings (Loss) per Share/Unit (Details) (USD $)
|
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
|
Numerator: | ||||
Income (loss) from continuing operations | $ 4,188,000 | $ (7,481,000) | $ 4,831,000 | $ (30,098,000) |
Income (loss) from continuing operations attributable to noncontrolling interests | (1,028,000) | (3,916,000) | (907,000) | (4,394,000) |
Income attributable to the company's preferred equity holders | (701,000) | (22,182,000) | (1,403,000) | (34,621,000) |
Income attributable to participating securities | (140,000) | (95,000) | (280,000) | (214,000) |
Income (loss) from continuing operations attributable to the company's common equityholders | 2,319,000 | (33,674,000) | 2,241,000 | (69,327,000) |
Income from discontinued operations | 2,791,000 | 41,612,000 | 4,981,000 | 74,876,000 |
Loss (income) from discontinued operations attributable to noncontrolling interests | 4,997,000 | (7,415,000) | 7,935,000 | (15,635,000) |
Income from discontinued operations attributable to the company's common equityholders | 7,788,000 | 34,197,000 | 12,916,000 | 59,241,000 |
Net income | 6,979,000 | 34,131,000 | 9,812,000 | 44,778,000 |
Net loss (income) attributable to noncontrolling interests | 3,969,000 | (11,331,000) | 7,028,000 | (20,029,000) |
Income attributable to the company's preferred equityholders | (701,000) | (22,182,000) | (1,403,000) | (34,621,000) |
Income attributable to participating securities | (140,000) | (95,000) | (280,000) | (214,000) |
Net income (loss) attributable to the company's common equityholders | 10,107,000 | 523,000 | 15,157,000 | (10,086,000) |
Denominator: | ||||
Denominator for basic earnings per share/unit - weighted average number of common shares/units outstanding | 145,321,000 | 127,395,000 | 145,245,000 | 123,960,000 |
Effect of dilutive securities: | ||||
Dilutive potential common shares/units | (353,000) | 0 | (287,000) | 0 |
Denominator for diluted earnings per share/unit | 145,674,000 | 127,395,000 | 145,532,000 | 123,960,000 |
Earnings (loss) per common share/unit - basic and diluted | ||||
Income (loss) from continuing operations attributable to the company's common equityholders | $ 0.02 | $ (0.26) | $ 0.01 | $ (0.56) |
Income from discontinued operations attributable to the company's common equityholders | $ 0.05 | $ 0.26 | $ 0.09 | $ 0.48 |
Net income (loss) attributable to the company's common equityholders (In dollars per share/unit) | $ 0.07 | $ 0.00 | $ 0.10 | $ (0.08) |
Earnings Per Share/Unit (Textual) [Abstract] | ||||
Common share/unit equivalents that could potentially dilute basic earnings per share/unit in future periods | 3,000,000 | |||
Nonvested Restricted Shares of Common Stock with Non-forfeitable Dividend Rights | 600,000 | 500,000 | 600,000 | 500,000 |
Method used in calculating earnings per share/unit | two-class method | |||
Preferred OP Units, Distributions, Low Range | 1.80% | 1.80% | ||
Preferred OP Units, Distributions, High Range | 8.80% | 8.80% | ||
Preferred OP Units outstanding | 2,900,000 | 2,900,000 | ||
Redemption value of Preferred OP Units outstanding | 79,200,000 | 79,200,000 | ||
Number of shares of common stock required to redeem Preferred OP Units tendered for redemption, if parent chooses to redeem in shares rather than cash | 2,600,000 | 2,600,000 | ||
AIMCO PROPERTIES, L.P
|
||||
Numerator: | ||||
Income (loss) from continuing operations | 4,188,000 | (7,481,000) | 4,831,000 | (30,098,000) |
Income (loss) from continuing operations attributable to noncontrolling interests | 698,000 | (4,512,000) | 2,439,000 | (5,746,000) |
Income attributable to the company's preferred equity holders | (2,307,000) | (23,793,000) | (4,615,000) | (37,902,000) |
Income attributable to participating securities | (140,000) | (95,000) | (280,000) | (214,000) |
Income (loss) from continuing operations attributable to the company's common equityholders | 2,439,000 | (35,881,000) | 2,375,000 | (73,960,000) |
Income from discontinued operations | 2,791,000 | 41,612,000 | 4,981,000 | 74,876,000 |
Loss (income) from discontinued operations attributable to noncontrolling interests | 5,452,000 | (5,153,000) | 8,673,000 | (11,684,000) |
Income from discontinued operations attributable to the company's common equityholders | 8,243,000 | 36,459,000 | 13,654,000 | 63,192,000 |
Net income | 6,979,000 | 34,131,000 | 9,812,000 | 44,778,000 |
Net loss (income) attributable to noncontrolling interests | 6,150,000 | (9,665,000) | 11,112,000 | (17,430,000) |
Income attributable to the company's preferred equityholders | (2,307,000) | (23,793,000) | (4,615,000) | (37,902,000) |
Income attributable to participating securities | (140,000) | (95,000) | (280,000) | (214,000) |
Net income (loss) attributable to the company's common equityholders | $ 10,682,000 | $ 578,000 | $ 16,029,000 | $ (10,768,000) |
Denominator: | ||||
Denominator for basic earnings per share/unit - weighted average number of common shares/units outstanding | 153,294,000 | 135,622,000 | 153,217,000 | 132,159,000 |
Effect of dilutive securities: | ||||
Dilutive potential common shares/units | (353,000) | 0 | (287,000) | 0 |
Denominator for diluted earnings per share/unit | 153,647,000 | 135,622,000 | 153,504,000 | 132,159,000 |
Earnings (loss) per common share/unit - basic and diluted | ||||
Income (loss) from continuing operations attributable to the company's common equityholders | $ 0.02 | $ (0.26) | $ 0.01 | $ (0.56) |
Income from discontinued operations attributable to the company's common equityholders | $ 0.05 | $ 0.26 | $ 0.09 | $ 0.48 |
Net income (loss) attributable to the company's common equityholders (In dollars per share/unit) | $ 0.07 | $ 0.00 | $ 0.10 | $ (0.08) |
Assets Held for Sale and Discontinued Operations (Details 1) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
|
Components of income from discontinued operations including portions attributable to Aimco and noncontrolling interests | ||||
Rental and other property revenues | $ 247 | $ 20,892 | $ 781 | $ 46,317 |
Property operating expenses | (229) | (6,433) | (427) | (19,341) |
Depreciation and amortization | (43) | (7,357) | (140) | (16,203) |
(Provision for) recovery of real estate impairment losses | (103) | (5,773) | 124 | (6,384) |
Operating (loss) income | (128) | 1,329 | 338 | 4,389 |
Interest income | 114 | 134 | 172 | 284 |
Interest expense | (70) | (2,753) | (165) | (8,387) |
(Loss) income before gain on dispositions of real estate and income tax | (84) | (1,290) | 345 | (3,714) |
Gain on dispositions of real estate | 2,663 | 48,518 | 4,606 | 84,211 |
Income tax benefit (expense) | 212 | (5,616) | 30 | (5,621) |
Income from discontinued operations, net | 2,791 | 41,612 | 4,981 | 74,876 |
Loss (income) from discontinued operations attributable to noncontrolling interests in consolidated real estate partnerships | 5,452 | (5,153) | 8,673 | (11,684) |
Income from discontinued operations attributable to the Aimco Operating Partnership | 8,243 | 36,459 | 13,654 | 63,192 |
Income from discontinued operations attributable to noncontrolling interests in Aimco Operating Partnership | (455) | (2,262) | (738) | (3,951) |
Income from discontinued operations attributable to the company's common equityholders | $ 7,788 | $ 34,197 | $ 12,916 | $ 59,241 |
Variable Interest Entities (Details 1) (USD $)
|
Jun. 30, 2013
|
Dec. 31, 2012
|
---|---|---|
Basis Of Presentation [Line Items] | ||
Net real estate related to Variable Interest Entities | $ 427,043,000 | $ 599,302,000 |
Non-recourse property debt related to Variable Interest Entities | 372,489,000 | 495,012,000 |
Variable Interest Entity, Not Primarily Beneficiary Held Through Consolidated Tax Credit Funds in Which Company Holds Substantially All Economic Interests [Member]
|
||
Basis Of Presentation [Line Items] | ||
Maximum risk or loss related to investment in, receivable from, or contractual obligation to advance funds to unconsolidated VIEs | 4,000,000 | |
Receivables From Unconsolidated Variable Interest Entities [Member]
|
||
Basis Of Presentation [Line Items] | ||
Maximum risk or loss related to investment in, receivable from, or contractual obligation to advance funds to unconsolidated VIEs | 215,800,000 | |
Variable Interest Entity, Primary Beneficiary [Member]
|
||
Basis Of Presentation [Line Items] | ||
Net real estate related to Variable Interest Entities | 427,000,000 | |
Non-recourse property debt related to Variable Interest Entities | $ 372,500,000 | |
Number of apartment properties owned by consolidated variable interest entities | 52 | |
Number Of Units In Apartment Properties Owned By Variable Interest Entities | 8,100 | |
Number of consolidated properties in portfolio | 66 | |
Variable Interest Entity, Not Primary Beneficiary [Member]
|
||
Basis Of Presentation [Line Items] | ||
Number of apartment properties owned by consolidated variable interest entities | 92 | |
Number Of Units In Apartment Properties Owned By Variable Interest Entities | 2,360 | |
Number of consolidated properties in portfolio | 39 |
Business Segments (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
|||||||||
Summary information for the reportable segments | ||||||||||||
Rental and other property revenues | $ 251,853 | [1] | $ 244,374 | [1] | $ 499,700 | [1] | $ 488,279 | [1] | ||||
Tax credit and asset management revenues | 7,809 | 8,914 | 15,061 | 16,985 | ||||||||
Total revenues | 259,662 | 253,288 | 514,761 | 505,264 | ||||||||
Property operating expenses | 101,717 | [1] | 99,807 | [1] | 203,420 | [1] | 198,418 | [1] | ||||
Investment management expenses | 1,697 | 3,240 | 3,130 | [1] | 6,628 | |||||||
Depreciation and amortization | 78,345 | [1] | 87,229 | [1] | 158,618 | 173,795 | [1] | |||||
Provision for real estate impairment losses | 0 | 2,275 | 0 | 8,349 | [1] | |||||||
General and administrative expenses | 11,153 | 13,556 | 22,932 | 25,181 | ||||||||
Other expenses, net | 2,226 | (957) | 4,436 | 4,772 | ||||||||
Total operating expenses | 195,138 | 205,150 | 392,536 | 417,143 | ||||||||
Net operating income (loss) | 64,524 | 48,138 | 122,225 | 88,121 | ||||||||
Other items included in continuing operations | (60,336) | (55,619) | (117,394) | (118,219) | ||||||||
Income (loss) from continuing operations | 4,188 | (7,481) | 4,831 | (30,098) | ||||||||
Conventional Real Estate Operations [Member]
|
||||||||||||
Summary information for the reportable segments | ||||||||||||
Rental and other property revenues | 213,331 | [1] | 200,795 | [1] | 422,830 | [1] | 398,360 | [1] | ||||
Tax credit and asset management revenues | ||||||||||||
Total revenues | 213,331 | 200,795 | 422,830 | 398,360 | ||||||||
Property operating expenses | 77,606 | [1] | 72,947 | [1] | 154,933 | [1] | 145,564 | [1] | ||||
Investment management expenses | [1] | |||||||||||
Depreciation and amortization | [1] | [1] | [1] | |||||||||
Provision for real estate impairment losses | [1] | [1] | ||||||||||
General and administrative expenses | ||||||||||||
Other expenses, net | 0 | |||||||||||
Total operating expenses | 77,606 | 72,947 | 154,933 | 145,564 | ||||||||
Net operating income (loss) | 135,725 | 127,848 | 267,897 | 252,796 | ||||||||
Other items included in continuing operations | 0 | |||||||||||
Income (loss) from continuing operations | 135,725 | 127,848 | 267,897 | 252,796 | ||||||||
Affordable Real Estate Operations [Member]
|
||||||||||||
Summary information for the reportable segments | ||||||||||||
Rental and other property revenues | 25,494 | [1] | 25,162 | [1] | 50,876 | [1] | 50,092 | [1] | ||||
Tax credit and asset management revenues | ||||||||||||
Total revenues | 25,494 | 25,162 | 50,876 | 50,092 | ||||||||
Property operating expenses | 10,123 | [1] | 9,808 | [1] | 20,682 | [1] | 19,751 | [1] | ||||
Investment management expenses | [1] | |||||||||||
Depreciation and amortization | [1] | [1] | [1] | |||||||||
Provision for real estate impairment losses | [1] | [1] | ||||||||||
General and administrative expenses | ||||||||||||
Other expenses, net | 0 | |||||||||||
Total operating expenses | 10,123 | 9,808 | 20,682 | 19,751 | ||||||||
Net operating income (loss) | 15,371 | 15,354 | 30,194 | 30,341 | ||||||||
Other items included in continuing operations | 0 | |||||||||||
Income (loss) from continuing operations | 15,371 | 15,354 | 30,194 | 30,341 | ||||||||
Proportionate Adjustments [Member]
|
||||||||||||
Summary information for the reportable segments | ||||||||||||
Rental and other property revenues | 13,008 | [1],[2] | 18,301 | [1],[2] | 25,951 | [1],[2] | 39,576 | [1],[2] | ||||
Tax credit and asset management revenues | [2] | [2] | [2] | [2] | ||||||||
Total revenues | 13,008 | [2] | 18,301 | [2] | 25,951 | [2] | 39,576 | [2] | ||||
Property operating expenses | 4,806 | [1],[2] | 8,355 | [1],[2] | 9,706 | [1],[2] | 15,386 | [1],[2] | ||||
Investment management expenses | [2] | [2] | [1],[2] | [2] | ||||||||
Depreciation and amortization | [1],[2] | [1],[2] | [2] | [1],[2] | ||||||||
Provision for real estate impairment losses | [1],[2] | [1],[2] | ||||||||||
General and administrative expenses | [2] | [2] | [2] | [2] | ||||||||
Other expenses, net | [2] | [2] | [2] | 0 | [2] | |||||||
Total operating expenses | 4,806 | [2] | 8,355 | [2] | 9,706 | [2] | 15,386 | [2] | ||||
Net operating income (loss) | 8,202 | [2] | 9,946 | [2] | 16,245 | [2] | 24,190 | [2] | ||||
Other items included in continuing operations | [2] | [2] | [2] | 0 | [2] | |||||||
Income (loss) from continuing operations | 8,202 | [2] | 9,946 | [2] | 16,245 | [2] | 24,190 | [2] | ||||
Corporate and Amounts Not Allocated to Segments [Member]
|
||||||||||||
Summary information for the reportable segments | ||||||||||||
Rental and other property revenues | 20 | [1] | 116 | [1] | 43 | [1] | 251 | [1] | ||||
Tax credit and asset management revenues | 7,809 | 8,914 | 15,061 | 16,985 | ||||||||
Total revenues | 7,829 | 9,030 | 15,104 | 17,236 | ||||||||
Property operating expenses | 9,182 | [1] | 8,697 | [1] | 18,099 | [1] | 17,717 | [1] | ||||
Investment management expenses | 1,697 | 3,240 | 3,130 | [1] | 6,628 | |||||||
Depreciation and amortization | 78,345 | [1] | 87,229 | [1] | 158,618 | 173,795 | [1] | |||||
Provision for real estate impairment losses | 2,275 | [1] | 8,349 | [1] | ||||||||
General and administrative expenses | 11,153 | 13,556 | 22,932 | 25,181 | ||||||||
Other expenses, net | 2,226 | (957) | 4,436 | 4,772 | ||||||||
Total operating expenses | 102,603 | 114,040 | 207,215 | 236,442 | ||||||||
Net operating income (loss) | (94,774) | (105,010) | (192,111) | (219,206) | ||||||||
Other items included in continuing operations | (60,336) | (55,619) | (117,394) | (118,219) | ||||||||
Income (loss) from continuing operations | $ (155,110) | $ (160,629) | $ (309,505) | $ (337,425) | ||||||||
|
Basis of Presentation and Summary of Significant Accounting Policies (Details 1) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
|
Schedule of Capitalization, Equity [Line Items] | ||||
Balance, December 31, 2012 | $ 1,154,894 | |||
Contributions | 1,157 | |||
Preferred stock/unit dividends/distributions | (1,402) | |||
Common dividends and distributions | (90,562) | |||
Amortization of stock-based compensation cost | 3,459 | |||
Stock option exercises | 983 | |||
Effect of changes in ownership for consolidated entities (Note 4) | (11,143) | |||
Change in accumulated other comprehensive loss | 500 | (2,339) | (611) | 525 |
Other | (317) | |||
Net income (loss) | 6,600 | |||
Balance, June 30, 2013 | 1,063,058 | 1,063,058 | ||
Partners' capital attributable to the Partnership
|
||||
Schedule of Capitalization, Equity [Line Items] | ||||
Change in accumulated other comprehensive loss | 500 | (2,339) | (611) | 525 |
Aimco Equity [Member]
|
||||
Schedule of Capitalization, Equity [Line Items] | ||||
Balance, December 31, 2012 | 915,425 | |||
Contributions | ||||
Preferred stock/unit dividends/distributions | (1,402) | |||
Common dividends and distributions | (70,014) | |||
Amortization of stock-based compensation cost | 3,459 | |||
Stock option exercises | 983 | |||
Effect of changes in ownership for consolidated entities (Note 4) | (12,489) | |||
Change in accumulated other comprehensive loss | (823) | |||
Other | (608) | |||
Net income (loss) | 16,840 | |||
Balance, June 30, 2013 | 851,371 | 851,371 | ||
Noncontrolling Interests in Consolidated Real Estate Partnerships [Member]
|
||||
Schedule of Capitalization, Equity [Line Items] | ||||
Balance, December 31, 2012 | 271,065 | |||
Contributions | 1,157 | |||
Preferred stock/unit dividends/distributions | ||||
Common dividends and distributions | (16,664) | |||
Amortization of stock-based compensation cost | ||||
Stock option exercises | ||||
Effect of changes in ownership for consolidated entities (Note 4) | 2,012 | |||
Change in accumulated other comprehensive loss | 257 | |||
Other | 78 | |||
Net income (loss) | (11,112) | |||
Balance, June 30, 2013 | 246,793 | 246,793 | ||
Common Noncontrolling Interests in Aimco Operating Partnership [Member]
|
||||
Schedule of Capitalization, Equity [Line Items] | ||||
Balance, December 31, 2012 | (31,596) | |||
Contributions | ||||
Preferred stock/unit dividends/distributions | ||||
Common dividends and distributions | (3,884) | |||
Amortization of stock-based compensation cost | ||||
Stock option exercises | ||||
Effect of changes in ownership for consolidated entities (Note 4) | (666) | |||
Change in accumulated other comprehensive loss | (45) | |||
Other | 213 | |||
Net income (loss) | 872 | |||
Balance, June 30, 2013 | $ (35,106) | $ (35,106) |
Fair Value Measurements (Details 1) (Total Return Swap [Member])
|
6 Months Ended | |
---|---|---|
Jun. 30, 2013
Property
|
Jun. 30, 2012
Property
|
|
Total Return Swap [Member]
|
||
Nonrecourse property debt: | ||
Number of properties encumbered by nonrecourse property debt measured at fair value during period | 4 | 4 |
Weighted average interest rate | 5.90% | 5.80% |
Weighted average maturity | 23 years 5 months | 24 years 5 months |
Weighted average loan-to-value ratio | 79.00% | 78.50% |
Fair Value Measurements (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair value of assets and liabilities measured on a recurring basis | The table below presents information regarding significant items measured in our condensed consolidated financial statements at fair value on a recurring basis, consisting of investments in the securitization trust discussed above, which we classify as available for sale (AFS), IR swaps, TRR swaps and TRR debt (in thousands):
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Weighted average unobservable inputs for real estate properties impaired and nonrecourse property debt measured at fair value |
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Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $)
In Thousands, unless otherwise specified |
6 Months Ended | ||||
---|---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||
Net income | $ 9,812 | $ 44,778 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||
Depreciation and amortization | 158,618 | 173,795 | [1] | ||
Provision for real estate impairment losses | 0 | 8,349 | [1] | ||
Equity in (income) losses of unconsolidated real estate partnerships | 628 | (3,005) | |||
Discontinued operations | (4,620) | (56,003) | |||
Other adjustments | 1,440 | (9,149) | |||
Net changes in operating assets and operating liabilities | 8,404 | (12,743) | |||
Net cash provided by operating activities | 173,026 | 152,032 | |||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||
Purchases of real estate | (19,444) | (79,743) | |||
Capital expenditures | (163,368) | (117,431) | |||
Proceeds from dispositions of real estate | 7,960 | 153,869 | |||
Purchases of corporate assets | (5,123) | (4,851) | |||
Purchase of property loans | (119,101) | 0 | |||
Change in restricted cash | 19,932 | (6,279) | |||
Proceeds from sale of interests in and distributions from unconsolidated real estate partnerships | 1,701 | 14,698 | |||
Other investing activities | 10,674 | 10,399 | |||
Net cash used in investing activities | (266,769) | (29,338) | |||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||
Proceeds from non-recourse property debt | 111,007 | 115,654 | |||
Principal repayments on non-recourse property debt | (153,532) | (173,947) | |||
Net borrowings on revolving credit facility | 187,050 | 0 | |||
Proceeds from issuance of preferred stock or units | 0 | 9,818 | |||
Proceeds from issuance of common stock or units | 0 | 558,600 | |||
Redemptions of preferred stock or units | 0 | (300,938) | |||
Proceeds from Common Stock option exercises | 983 | 48,906 | |||
Payment of dividends to holders of preferred stock or units | (1,402) | (28,999) | |||
Payment of dividends to holders of Common Stock | (70,014) | (45,773) | |||
Payment of distributions to noncontrolling interests | (22,513) | (26,958) | |||
Purchases of noncontrolling interests in consolidated real estate partnerships | 2,528 | 48,280 | |||
Other financing activities | 7,202 | (8,879) | |||
Net cash provided by financing activities | 56,253 | 99,204 | |||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (37,490) | 221,898 | |||
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 84,413 | 91,066 | |||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 46,923 | 312,964 | |||
AIMCO PROPERTIES, L.P
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CASH FLOWS FROM OPERATING ACTIVITIES: | |||||
Net income | 9,812 | 44,778 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||
Depreciation and amortization | 158,618 | 173,795 | |||
Provision for real estate impairment losses | 0 | 8,349 | |||
Equity in (income) losses of unconsolidated real estate partnerships | 628 | (3,005) | |||
Discontinued operations | (4,620) | (56,003) | |||
Other adjustments | 1,440 | (9,149) | |||
Net changes in operating assets and operating liabilities | 8,404 | (12,743) | |||
Net cash provided by operating activities | 173,026 | 152,032 | |||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||
Purchases of real estate | (19,444) | (79,743) | |||
Capital expenditures | (163,368) | (117,431) | |||
Proceeds from dispositions of real estate | 7,960 | 153,869 | |||
Purchases of corporate assets | (5,123) | (4,851) | |||
Purchase of property loans | (119,101) | 0 | |||
Change in restricted cash | 19,932 | (6,279) | |||
Proceeds from sale of interests in and distributions from unconsolidated real estate partnerships | 1,701 | 14,698 | |||
Other investing activities | 10,674 | 10,399 | |||
Net cash used in investing activities | (266,769) | (29,338) | |||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||
Proceeds from non-recourse property debt | 111,007 | 115,654 | |||
Principal repayments on non-recourse property debt | (153,532) | (173,947) | |||
Net borrowings on revolving credit facility | 187,050 | 0 | |||
Proceeds from issuance of preferred stock or units | 0 | 9,818 | |||
Proceeds from issuance of common stock or units | 0 | 558,600 | |||
Redemptions of preferred stock or units | 0 | (300,938) | |||
Proceeds from Common Stock option exercises | 983 | 48,906 | |||
Payment of dividends to holders of preferred stock or units | (4,614) | (32,280) | |||
Payment of distributions to General Partner and Special Limited Partner | (70,014) | (45,773) | |||
Payment of distributions to Limited Partners | (3,884) | (2,935) | |||
Payment of distributions to noncontrolling interests | (15,417) | (20,742) | |||
Purchases of noncontrolling interests in consolidated real estate partnerships | 2,528 | 48,280 | |||
Other financing activities | 7,202 | (8,879) | |||
Net cash provided by financing activities | 56,253 | 99,204 | |||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (37,490) | 221,898 | |||
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 84,413 | 91,066 | |||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ 46,923 | $ 312,964 | |||
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Basis of Presentation and Summary of Significant Accounting Policies
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Jun. 30, 2013
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation and Summary of Significant Accounting Policies | NOTE 2 — Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP, have been condensed or omitted in accordance with such rules and regulations, although management believes the disclosures are adequate to prevent the information presented from being misleading. In the opinion of management, all adjustments (consisting of normal recurring items) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2013, are not necessarily indicative of the results that may be expected for the year ending December 31, 2013. The balance sheets of Aimco and the Aimco Operating Partnership at December 31, 2012, have been derived from their audited financial statements at that date, but do not include all of the information and disclosures required by GAAP for complete financial statements. For further information, refer to the financial statements and notes thereto included in Aimco’s and the Aimco Operating Partnership’s combined Annual Report on Form 10-K for the year ended December 31, 2012. Certain 2012 financial statement amounts have been reclassified to conform to the 2013 presentation, including adjustments for discontinued operations. Except where indicated, the footnotes refer to both Aimco and the Aimco Operating Partnership. Principles of Consolidation Aimco’s accompanying condensed consolidated financial statements include the accounts of Aimco, the Aimco Operating Partnership, and their consolidated subsidiaries. The Aimco Operating Partnership’s condensed consolidated financial statements include the accounts of the Aimco Operating Partnership and its consolidated entities. We consolidate all variable interest entities for which we are the primary beneficiary. Generally, a variable interest entity, or VIE, is a legal entity in which the equity investors do not have the characteristics of a controlling financial interest or the equity investors lack sufficient equity at risk for the entity to finance its activities without additional subordinated financial support. In determining whether we are the primary beneficiary of a VIE, we consider qualitative and quantitative factors, including, but not limited to: which activities most significantly impact the VIE’s economic performance and which party controls such activities; the amount and characteristics of our investment; the obligation or likelihood for us or other investors to provide financial support; and the similarity with and significance to the business activities of us and the other investors. Significant judgments related to these determinations include estimates about the current and future fair values and performance of real estate held by these VIEs and general market conditions. Refer to Note 5 for further information regarding our involvement with VIEs. Generally, we consolidate real estate partnerships and other entities that are not variable interest entities when we own, directly or indirectly, a majority voting interest in the entity or are otherwise able to control the entity. All significant intercompany balances and transactions have been eliminated in consolidation. Interests in the Aimco Operating Partnership that are held by limited partners other than Aimco are reflected in Aimco’s accompanying balance sheets as noncontrolling interests in Aimco Operating Partnership. Interests in partnerships consolidated into the Aimco Operating Partnership that are held by third parties are reflected in our accompanying balance sheets as noncontrolling interests in consolidated real estate partnerships. The assets of consolidated real estate partnerships owned or controlled by the Aimco Operating Partnership generally are not available to pay creditors of Aimco or the Aimco Operating Partnership. As used herein, and except where the context otherwise requires, “partnership” refers to a limited partnership or a limited liability company and “partner” refers to a partner in a limited partnership or a member in a limited liability company. Temporary Equity and Partners’ Capital The following table presents a reconciliation of the Aimco Operating Partnership’s Preferred OP Units from December 31, 2012 to June 30, 2013 (in thousands). These amounts are presented within temporary equity in Aimco’s condensed consolidated balance sheets as preferred noncontrolling interests in the Aimco Operating Partnership, and within temporary capital in the Aimco Operating Partnership’s condensed consolidated balance sheets as redeemable preferred units.
Aimco Equity (including Noncontrolling Interests) The following table presents a reconciliation of Aimco’s consolidated permanent equity accounts from December 31, 2012 to June 30, 2013 (in thousands):
Partners’ Capital attributable to the Aimco Operating Partnership The following table presents a reconciliation of the consolidated partners’ capital balances in permanent capital that are attributable to the Aimco Operating Partnership from December 31, 2012 to June 30, 2013 (in thousands):
A separate reconciliation of noncontrolling interests in consolidated real estate partnerships and total partners’ capital for the Aimco Operating Partnership is not presented as these amounts are identical to the corresponding noncontrolling interests in consolidated real estate partnerships and total equity for Aimco, which are presented above. Income Taxes On October 25, 2012, the Internal Revenue Service issued Final Partnership Administrative Adjustments with respect to the Aimco Operating Partnership 2006 and 2007 tax years. On January 18, 2013, AIMCO-GP, Inc., in its capacity as tax matters partner of the Aimco Operating Partnership, filed a petition challenging those adjustments in the United States Tax Court in Washington, D.C. We do not expect the litigation regarding the 2006 or 2007 proposed adjustments to have any material effect on our unrecognized tax benefits, financial condition or results of operations. Use of Estimates The preparation of our condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts included in the financial statements and accompanying notes thereto. Actual results could differ from those estimates. |
Variable Interest Entities
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Jun. 30, 2013
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | NOTE 5 — Variable Interest Entities As of June 30, 2013, we were the primary beneficiary of, and therefore consolidated, 66 VIEs, which owned 52 apartment properties with 8,100 units. Real estate with a carrying value of $427.0 million collateralized $372.5 million of debt of those VIEs. Any significant amounts of assets and liabilities related to our consolidated VIEs are identified parenthetically on our accompanying condensed consolidated balance sheets. The creditors of the consolidated VIEs do not have recourse to our general credit. As of June 30, 2013, we also held variable interests in 39 VIEs for which we were not the primary beneficiary. Those VIEs consist primarily of partnerships that are engaged, directly or indirectly, in the ownership and management of 92 apartment properties with 2,360 units. We are involved with those VIEs as an equity holder or lender. Our maximum risk of loss related to our investment in these VIEs is generally limited to our $4.0 million recorded investment in such entities, which is included in other assets within our consolidated balances sheets. In addition to our investments in unconsolidated VIEs discussed above, at June 30, 2013, we had in aggregate $215.8 million of receivables from unconsolidated VIEs (primarily notes receivable collateralized by first and second mortgages on real estate properties discussed in Note 4). Our maximum risk of loss associated with our lending activities related to these unconsolidated VIEs is limited to these amounts. We may be subject to additional losses to the extent of any receivables relating to future provision of services to these entities or financial support that we voluntarily provide. In addition to the consolidated and unconsolidated VIEs discussed above, at June 30, 2013, our consolidated financial statements included certain consolidated and unconsolidated VIEs that were sold in connection with the sale of our legacy asset management business. |
Assets Held for Sale and Discontinued Operations
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Jun. 30, 2013
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Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets Held for Sale and Discontinued Operations | NOTE 3 — Assets Held for Sale and Discontinued Operations We report as discontinued operations real estate properties that meet the definition of a component of an entity and have been sold or meet the criteria to be classified as held for sale. We include all results of these discontinued operations, less applicable income taxes, in a separate component of income on the consolidated statements of operations under the heading “income from discontinued operations, net.” This treatment resulted in the retrospective adjustment of the statements of operations for the three and six months ended June 30, 2012 and the balance sheet as of December 31, 2012. We are currently marketing for sale certain real estate properties that are inconsistent with our long-term investment strategy. At the end of each reporting period, we evaluate whether such properties meet the criteria to be classified as held for sale, including whether such properties are expected to be sold within 12 months. Additionally, certain properties that do not meet all of the criteria to be classified as held for sale at the balance sheet date may nevertheless be sold and included in discontinued operations in the subsequent 12 months; thus the number of properties that may be sold during the subsequent 12 months could exceed the number classified as held for sale. At December 31, 2012, after adjustments to classify as held for sale properties that were sold during the six months ended June 30, 2013, we had five properties with an aggregate of 230 units classified as held for sale. Amounts classified as held for sale in the accompanying condensed consolidated balance sheets as of December 31, 2012 are as follows (in thousands):
During the six months ended June 30, 2013 and 2012, we sold five properties and 28 properties with an aggregate of 230 units and 3,934 units, respectively. During the year ended December 31, 2012, we sold 75 consolidated properties with an aggregate of 11,232 units. For the three and six months ended June 30, 2013 and 2012, discontinued operations includes the results of operations for the periods prior to the date of disposition for all properties sold as of June 30, 2013. The following is a summary of the components of income from discontinued operations and the related amounts of income from discontinued operations attributable to Aimco, the Aimco Operating Partnership and noncontrolling interests for the three and six months ended June 30, 2013 and 2012 (in thousands):
Gain on dispositions of real estate is reported net of incremental direct costs incurred in connection with the transactions, including any prepayment penalties incurred upon repayment of property loans collateralized by the properties being sold. Such prepayment penalties totaled $0.7 million and $0.9 million for the three and six months ended June 30, 2013, respectively, and $1.2 million and $2.5 million for the three and six months ended June 30, 2012, respectively. We classify interest expense related to property debt within discontinued operations when the related real estate asset is sold or classified as held for sale. In connection with properties sold during the three and six months ended June 30, 2013, we allocated $0.2 million and $0.4 million, respectively, of goodwill related to our conventional and affordable segments to the carrying amounts of the properties sold. In connection with properties sold or during the three and six months ended June 30, 2012, we allocated $1.4 million and $2.1 million, respectively, of goodwill related to our conventional and affordable segments to the carrying amounts of the properties sold. The amounts of goodwill allocated to these properties were based on the relative fair values of the properties sold and the retained portions of the reporting units to which the goodwill was allocated. In connection with our real estate dispositions during the six months ended June 30, 2013, the purchasers assumed approximately $2.1 million of non-recourse property debt, and during the three and six months ended June 30, 2012, the purchasers assumed approximately $45.1 million and $56.3 million, respectively, of non-recourse property debt. |
Derivative Financial Instruments (Details) (USD $)
In Millions, unless otherwise specified |
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Jun. 30, 2013
Property
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Dec. 31, 2012
Property
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Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notional amount of interest rate swaps | $ 50.9 | $ 51.0 |
Interest rate swaps fair value | 5.5 | 8.0 |
Period for reclassification of earnings | 12 months | |
Interest Rate Swap [Member]
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Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Weighted average term of interest rate swaps, in years | 7 years 6 months | |
Estimated unrealized losses on interest rate swaps that will be reclassified into earnings during the next twelve months | 1.7 | |
Weighted average fixed rate related to the interest rate swaps | 3.43% | |
Total rate of return swaps [Member]
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Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Weighted average fixed rate related to the interest rate swaps | 5.90% | |
Borrowings subject to total rate of return swaps | 73.4 | 74.0 |
Weighted average variable pay rate | 2.10% | |
Maturity date of swap | May 01, 2014 | |
Maturity date of borrowings | Jan. 01, 2036 | |
Cash collateral provided pursuant to total return swaps | $ 20.0 | $ 20.0 |
Number of properties collateralizing property debt | 4 | 4 |
Business Segments (Tables)
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Jun. 30, 2013
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary information for the reportable segments |
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Basis of Presentation and Summary of Significant Accounting Policies OP Equity Table (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2013
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Jun. 30, 2012
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Jun. 30, 2013
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Jun. 30, 2012
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Schedule of Equity [Line Items] | ||||
Preferred stock/unit dividends/distributions | $ (1,402) | |||
Amortization of stock-based compensation cost | 3,459 | |||
Stock option exercises | 983 | |||
Effect Of Changes In Ownership For Consolidated Entities | (11,143) | |||
Change in accumulated other comprehensive loss | 500 | (2,339) | (611) | 525 |
Other | (317) | |||
Net income (loss) | 6,600 | |||
AIMCO PROPERTIES, L.P
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Schedule of Equity [Line Items] | ||||
Partners' Capital, December 31, 2012 | 883,829 | |||
Change in accumulated other comprehensive loss | 500 | (2,339) | (611) | 525 |
Partners' Capital, June 30, 2013 | 816,265 | 816,265 | ||
Partners' capital attributable to the Partnership [Member] | AIMCO PROPERTIES, L.P
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Schedule of Equity [Line Items] | ||||
Partners' Capital, December 31, 2012 | 883,829 | |||
Preferred stock/unit dividends/distributions | (1,402) | |||
Distributions to common partnership units held by parent | 70,014 | |||
Distributions to Limited Partnership Units Held By Parent | (3,884) | |||
Amortization of stock-based compensation cost | 3,459 | |||
Stock option exercises | 983 | |||
Effect Of Changes In Ownership For Consolidated Entities | (13,155) | |||
Change in accumulated other comprehensive loss | (868) | |||
Other | (395) | |||
Net income (loss) | 17,712 | |||
Partners' Capital, June 30, 2013 | $ 816,265 | $ 816,265 |
Other Significant Transactions Details 1 (Details) (USD $)
In Thousands, unless otherwise specified |
Jun. 30, 2013
Property
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Dec. 31, 2012
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Schedule of Financial Position Related to Legally Sold Portfolio [Line Items] | ||
Number of partnerships in legally sold portfolio | 20 | |
Real estate, net | $ 128,917 | $ 127,025 |
Cash and cash equivalents and restricted cash | 30,092 | 31,560 |
Investment in unconsolidated real estate partnerships | 13,943 | 15,997 |
Other assets | 4,150 | 4,163 |
Total assets | 177,102 | 178,745 |
Total indebtedness | 112,077 | 110,737 |
Accrued and other liabilities | 29,646 | 29,435 |
Total liabilites | 141,723 | 140,172 |
Number of consolidated properties in legally sold portfolio | 17 | |
Number of unconsolidated properties in legally sold portfolio | 92 | |
Noncontrolling Interest in Limited Partnerships | 246,793 | 271,065 |
Legally Sold Portfolio, Not Derecognized for Accounting Purposes [Member]
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Schedule of Financial Position Related to Legally Sold Portfolio [Line Items] | ||
Noncontrolling Interest in Limited Partnerships | $ 52,800 | $ 57,200 |