Business Segments

During the three months ended March 31, 2019, as a result of the 2018 sale of the Asset Management business, we revised the information regularly reviewed by our chief executive officer, who is our chief operating decision maker, to assess our operating performance. We have determined we have four segments: Same Store, Redevelopment and Development, Acquisition, and Other Real Estate.

Our Same Store segment includes communities that have reached a stabilized level of operations as of the beginning of a two-year comparable period and maintained it throughout the current and comparable prior year, and are not expected to be sold within 12 months. Our Redevelopment and Development segment includes apartment communities that are currently under construction that have not achieved a stabilized level of operations, and those that have been completed in recent years that have not achieved and maintained stabilized operations for both the current and comparable prior year. Our Acquisition segment includes apartment communities that we have acquired since the beginning of a two-year comparable period. Our Other Real Estate segment primarily includes apartment communities that are subject to limitations on rent increases and communities that we expect to sell within 12 months but do not yet meet the criteria to be classified as held for sale.

Our chief operating decision maker uses proportionate property net operating income to assess the operating performance of our apartment communities. Proportionate property net operating income is defined as our share of rental and other property revenue less our share of property operating expenses for consolidated apartment communities. We exclude from rental and other property revenues the amount of utility costs reimbursed by residents and reflect such amount as a reduction of the related utility expense within property operating expenses in our evaluation of segment results. In our condensed consolidated statements of operations, utility reimbursements are included in rental and other property revenues, in accordance with GAAP.

As of March 31, 2019, our Same-Store segment included 96 consolidated apartment communities with 28,039 apartment homes; our Redevelopment and Development segment included seven consolidated apartment communities with 3,373 apartment homes; our Acquisition segment included six consolidated apartment communities with 1,480 apartment homes; and our Other Real Estate segment included 15 apartment communities with 1,315 apartment homes.

The following tables present the revenues, proportionate property net operating income and income before income tax (expense) benefit of our segments on a proportionate basis and excluding our proportionate share of four communities with 142 apartment homes, which we do not consolidate, and amounts related to apartment communities sold as of March 31, 2019 for the three months ended March 31, 2019 and 2018 (in thousands):



	Same Store		Redevelopment and Development		Acquisition		Other Real Estate		Proportionate and Other Adjustments (1)		Corporate and Amounts Not Allocated to Segments (2)			Consolidated
Three months ended March 31, 2019:
Total revenues	$	175,719	$	20,350	$	9,993	$	9,467	$	8,747	$	5,959		$	230,235
Property operating expenses attributable to real estate	47,137		7,290		2,855		3,883		8,189		9,830			79,184
Other operating expenses not allocated to segments (3)	—		—		—		—		—		109,637			109,637
Total operating expenses	47,137		7,290		2,855		3,883		8,189		119,467			188,821
Proportionate property net operating income	128,582		13,060		7,138		5,584		558		(113,508		)	41,414
Other items included in income before income tax expense (4)	—		—		—		—		—		252,862			252,862
Income before income tax expense	$	128,582	$	13,060	$	7,138	$	5,584	$	558	$	139,354		$	294,276



	Same Store		Redevelopment and Development		Acquisition		Other Real Estate		Proportionate and Other Adjustments (1)		Corporate and Amounts Not Allocated to Segments (2)			Consolidated
Three months ended March 31, 2018:
Rental and other property revenues attributable to real estate	$	168,606	$	18,077	$	1,580	$	9,312	$	8,236	$	19,582		$	225,393
Asset Management business rental and tax credit revenues	—		—		—		—		—		22,327			22,327
Total revenues	168,606		18,077		1,580		9,312		8,236		41,909			247,720
Property operating expenses attributable to real estate	46,755		6,499		523		3,839		7,726		12,945			78,287
Property operating expenses of partnerships served by Asset Management business	—		—		—		—		—		9,195			9,195
Other operating expenses not allocated to segments (3)	—		—		—		—		—		106,861			106,861
Total operating expenses	46,755		6,499		523		3,839		7,726		129,001			194,343
Proportionate property net operating income	121,851		11,578		1,057		5,473		510		(87,092		)	53,377
Other items included in income before income tax benefit (4)	—		—		—		—		—		7,796			7,796
Income before income tax benefit	$	121,851	$	11,578	$	1,057	$	5,473	$	510	$	(79,296	)	$	61,173

(1)

Represents adjustments for the noncontrolling interests in consolidated real estate partnerships’ share of the results of consolidated apartment communities in our segments, which are included in the related consolidated amounts, but excluded from proportionate property net operating income for our segment evaluation. Also includes the reclassification of utility reimbursements from revenues to property operating expenses for the purpose of evaluating segment results. Utility reimbursements are included in rental and other property revenues in our condensed consolidated statements of operations prepared in accordance with GAAP.

(2)

Includes the operating results of apartment communities sold during the periods shown or held for sale at the end of the period, if any, and the operating results of apartment communities owned by consolidated partnerships served by our Asset Management business prior to its sale in July 2018. Corporate and Amounts Not Allocated to Segments also includes property management expenses and casualty gains and losses, which are included in consolidated property operating expenses and are not part of our segment performance measure.


(3)	Other operating expenses not allocated to segments consists of depreciation and amortization, general and administrative expenses and other operating expenses, which are not included in our measure of segment performance.


(4)	Other items included in income before income tax (expense) benefit primarily consists of gain on dispositions of real estate and interest expense.

The assets of our segments and the consolidated assets not allocated to our segments were as follows (in thousands):



	March 31, 2019		December 31, 2018
Same Store	$	4,148,435	$	4,148,787
Redevelopment and Development	822,348		792,126
Acquisition	546,467		507,190
Other Real Estate	326,241		327,099
Corporate and other assets (1)	440,278		414,802
Total consolidated assets	$	6,283,769	$	6,190,004


(1)	Includes the assets not allocated to our segments, primarily corporate assets and assets of apartment communities sold as of March 31, 2019.

For the three months ended March 31, 2019 and 2018, capital additions related to our segments were as follows (in thousands):



	Three Months Ended March 31,
	2019		2018
Same Store	$	30,211	$	27,522
Redevelopment and Development	39,048		43,481
Acquisition	3,868		483
Other Real Estate	2,771		2,141
Total capital additions	$	75,898	$	73,627