Other Significant Transactions

Investments in Apartment Communities

In March 2015, we acquired for $38.3 million a 94-apartment home community located in Atlanta, Georgia.

In April 2015, we acquired for $63.0 million a 115-apartment home community located in Cambridge, Massachusetts at the completion of its construction. At September 30, 2015, 77% of the apartment homes were occupied.

In June 2015, we purchased a 91-apartment home community under construction at the time of acquisition. This community is also located in Cambridge, Massachusetts, and is two blocks from the apartment community described in the prior paragraph. At closing, we paid $27.9 million and agreed to fund the remaining construction costs. We expect a total investment of $45.0 million in this community, of which $38.8 million has been invested through September 30, 2015. Construction of the apartment homes was completed during the third quarter, and we began lease-up in October. Construction of the community's amenities is expected to be complete by year end.

Asset Management Business Disposition

In December 2012, we sold the Napico portfolio, our legacy asset management business. The transaction was primarily seller-financed, and the associated notes are scheduled to be repaid over several years. The notes will be repaid from the operation and liquidation of the 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 the sale and are accounting for the transaction under the profit sharing 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. To date we have received all required payments under the seller-financed notes.

At September 30, 2015, the Napico portfolio consisted of 14 partnerships that held investments in 12 apartment communities that were consolidated and 47 apartment communities that were accounted for under the equity or cost methods of accounting. The portfolio’s assets and liabilities included in our condensed consolidated balance sheets are summarized below (in thousands):



	September 30, 2015		December 31, 2014
Real estate, net	$	107,407	$	117,851
Cash and cash equivalents	33,715		23,133
Investment in unconsolidated real estate partnerships	766		8,392
Other assets	16,419		11,759
Total assets	$	158,307	$	161,135

Total indebtedness	$	143,987	$	113,641
Accrued and other liabilities	9,299		4,417
Total liabilities	$	153,286	$	118,058

Noncontrolling interests in consolidated real estate partnerships	697		44,106
Equity attributable to Aimco and the Aimco Operating Partnership	4,324		(1,029		)
Total liabilities and equity	$	158,307	$	161,135

During the nine months ended September 30, 2015, Napico sold a property, resulting in a reduction of real estate, and Napico refinanced a property, resulting in an increase in indebtedness and a reduction in noncontrolling interests in consolidated real estate partnerships, following distribution of the proceeds.

Summarized information regarding the Napico portfolio’s results of operations, including any expense we recognize under the profit sharing method, is shown below in thousands. The net income (loss) related to Napico (before income taxes and noncontrolling interests) is included in other, net in our condensed consolidated statements of operations.



	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2015			2014			2015			2014
Revenues	$	6,120		$	9,884		$	19,054		$	21,234
Expenses	(5,399		)	(5,114		)	(15,876		)	(15,992		)
Equity in loss of unconsolidated entities, gains or losses on dispositions and other, net	(2,614		)	(3,246		)	(2,420		)	(5,198		)
Net (loss) income related to legacy asset management business	(1,893		)	1,524			758			44
Income tax benefit (expense) associated with legacy asset management business	108			101			(1,916		)	411
Loss (income) allocated to noncontrolling interests in consolidated real estate partnerships	2,161			(1,768		)	4,672			(1,580		)
Net income (losses) of legacy asset management business attributable to Aimco and the Aimco Operating Partnership	$	376		$	(143	)	$	3,514		$	(1,125	)

Revenues decreased during the three and nine months ended September 30, 2015, as compared to the three and nine months ended September 30, 2014, due to an adjustment in 2014 to increase rent subsidies to reflect current market rates for one of the apartment communities in this portfolio.

Based on our limited economic ownership in this portfolio, most of the assets and liabilities are allocated to noncontrolling interests and do not significantly affect our consolidated equity and partners’ capital. Additionally, the operating results of this portfolio generally have an insignificant effect on the amounts of income or loss attributable to us. 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.

Equity and Partners’ Capital Transactions

During the nine months ended September 30, 2015, Aimco issued 9,430,000 shares of its Common Stock, par value $0.01 per share, in an underwritten public offering, for net proceeds per share of $38.90. The offering generated net proceeds to Aimco of $366.6 million, net of issuance costs. Aimco contributed the net proceeds from the sale of Common Stock to the Aimco Operating Partnership in exchange for a number of common partnership units equal to the number of shares of Common Stock issued.

Using the proceeds from this offering, during the nine months ended September 30, 2015, we repaid the then outstanding balance on our Credit Agreement, expanded our unencumbered asset pool, funded redevelopment and property upgrades investments that would otherwise have been funded with property debt on a leverage-neutral basis, and Aimco redeemed the remaining outstanding shares of its Series A Community Reinvestment Act Preferred Stock at its par value of $27.0 million. In connection with Aimco’s redemption of preferred stock, the Aimco Operating Partnership redeemed from Aimco an equal number of the corresponding class of partnership preferred units.