Business Segments

3 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Business Segments

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 apartment communities with rents paid by the residents and included 161 apartment communities with 49,314 apartment homes at March 31, 2014. Our affordable real estate operations consisted of 72 apartment communities with 9,680 apartment homes at March 31, 2014, with rents that are generally paid, in whole or part, by a government agency.

Due to the diversity of our economic ownership interests in our apartment communities, our chief executive officer, who is our operating decision maker, uses proportionate property net operating income to asses the operating performance of our apartment communities. Proportionate property net operating income reflects our share of rental and other property revenues less direct property operating expenses, including real estate taxes, for the consolidated and unconsolidated apartment communities that we manage.

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 March 31, 2014 and 2013 (in thousands):

	Conventional Real Estate Operations		Affordable Real Estate Operations		Proportionate Adjustments (1)		Corporate and Amounts Not Allocated to Segments (2)			Consolidated
Three Months Ended March 31, 2014:
Rental and other property revenues (3)	$	204,314	$	24,243	$	8,865	$	2,714		$	240,136
Tax credit and asset management revenues	—		—		—		8,788			8,788
Total revenues	204,314		24,243		8,865		11,502			248,924
Property operating expenses (3)	73,751		10,576		3,242		11,701			99,270
Investment management expenses	—		—		—		1,252			1,252
Depreciation and amortization (3)	—		—		—		70,307			70,307
General and administrative expenses	—		—		—		10,532			10,532
Other expense, net	—		—		—		2,390			2,390
Total operating expenses	73,751		10,576		3,242		96,182			183,751
Net operating income (loss)	130,563		13,667		5,623		(84,680		)	65,173
Other items included in continuing operations	—		—		—		(53,133		)	(53,133		)
Income (loss) from continuing operations	$	130,563	$	13,667	$	5,623	$	(137,813	)	$	12,040

	Conventional Real Estate Operations		Affordable Real Estate Operations		Proportionate Adjustments (1)		Corporate and Amounts Not Allocated to Segments (2)			Consolidated
Three Months Ended March 31, 2013:
Rental and other property revenues (3)	$	193,441	$	23,994	$	8,476	$	4,341		$	230,252
Tax credit and asset management revenues	—		—		—		7,252			7,252
Total revenues	193,441		23,994		8,476		11,593			237,504
Property operating expenses (3)	70,099		9,952		3,020		10,797			93,868
Investment management expenses	—		—		—		1,433			1,433
Depreciation and amortization (3)	—		—		—		75,716			75,716
General and administrative expenses	—		—		—		11,779			11,779
Other expense, net	—		—		—		2,069			2,069
Total operating expenses	70,099		9,952		3,020		101,794			184,865
Net operating income (loss)	123,342		14,042		5,456		(90,201		)	52,639
Other items included in continuing operations	—		—		—		(54,302		)	(54,302		)
Income (loss) from continuing operations	$	123,342	$	14,042	$	5,456	$	(144,503	)	$	(1,663	)

(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) Our basis for assessing segment performance excludes the results of apartment communities sold or classified as held for sale. As discussed in Note 3, effective January 1, 2014, we adopted ASU 2014-08, which revised the definition of a discontinued operation. In the segment presentation above, the current year and prior year operating results for apartment communities sold during 2014 are presented within the Corporate and Amounts Not Allocated to Segments column. The operating results for the three months ended March 31, 2013, for apartment communities sold through December 31, 2013, are presented within discontinued operations and are accordingly excluded from the segment presentation above.

(3) 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.

For the three months ended March 31, 2014 and 2013, capital additions related to our conventional segment totaled $86.6 million and $64.6 million, respectively, and capital additions related to our affordable segment totaled $1.7 million and $2.0 million, respectively.