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Assets Held for Sale and Discontinued Operations
 6 Months Ended
Jun. 30, 2013
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):
 
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


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):
 
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


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.