Segment Information

12 Months Ended

Dec. 31, 2012

Segment Reporting Information [Line Items]

Segment Information

Segment Information

Our principal business is the operation, acquisition and development of rental real estate properties. We evaluate our business by product type and by geographic location. Each product type has different customers and economic characteristics as to rental rates and terms, cost per square foot of buildings, the purposes for which customers use the space, the degree of maintenance and customer support required and customer dependency on different economic drivers, among others. The operating results by geographic grouping are also regularly reviewed by our chief operating decision maker for assessing performance and other purposes. There are no material inter-segment transactions.

Our accounting policies of the segments are the same as those used in our Consolidated Financial Statements. All operations are within the United States and, at December 31, 2012, no single customer of the Wholly Owned Properties generated more than 10.0% of our consolidated revenues on an annualized basis.

The following table summarizes the rental and other revenues and net operating income, the primary industry property-level performance metric which is defined as rental and other revenues less rental property and other expenses, for each reportable segment:

	Year Ended December 31,
	2012		2011		2010
Rental and Other Revenues: (1)
Office:
Atlanta, GA	$	61,947	$	49,521	$	44,480
Greenville, SC	13,395		14,076		13,612
Kansas City, MO	15,003		13,795		14,160
Memphis, TN	36,832		36,801		31,479
Nashville, TN	56,542		53,645		52,159
Orlando, FL	11,169		10,233		11,611
Piedmont Triad, NC	21,569		20,645		21,163
Pittsburgh, PA	38,796		10,963		—
Raleigh, NC	81,624		78,638		75,714
Richmond, VA	47,310		47,525		47,175
Tampa, FL	69,381		68,240		71,060
Total Office Segment	453,568		404,082		382,613
Industrial:
Atlanta, GA	12,805		13,266		12,335
Piedmont Triad, NC	12,518		11,827		12,372
Total Industrial Segment	25,323		25,093		24,707
Retail:
Kansas City, MO	37,211		34,269		33,516
Total Retail Segment	37,211		34,269		33,516
Total Rental and Other Revenues	$	516,102	$	463,444	$	440,836

19. Segment Information - Continued

	Year Ended December 31,
	2012			2011			2010
Net Operating Income: (1)
Office:
Atlanta, GA	$	39,306		$	31,077		$	27,607
Greenville, SC	7,612			8,333			8,142
Kansas City, MO	9,516			8,374			8,824
Memphis, TN	21,848			20,874			18,640
Nashville, TN	38,831			36,586			35,451
Orlando, FL	5,841			5,187			6,256
Piedmont Triad, NC	13,325			13,041			13,886
Pittsburgh, PA	19,545			5,450			—
Raleigh, NC	56,628			54,699			52,347
Richmond, VA	32,407			31,281			32,035
Tampa, FL	43,114			42,371			44,622
Total Office Segment	287,973			257,273			247,810
Industrial:
Atlanta, GA	9,282			9,780			8,734
Piedmont Triad, NC	9,149			8,652			9,037
Total Industrial Segment	18,431			18,432			17,771
Retail:
Kansas City, MO	22,528			20,157			19,927
Total Retail Segment	22,528			20,157			19,927
Residential:
Raleigh, NC	(178		)	(195		)	(362		)
Total Residential Segment	(178		)	(195		)	(362		)
Corporate and other (2)	(86		)	(76		)	(81		)
Total Net Operating Income	328,668			295,591			285,065
Reconciliation to income from continuing operations before disposition of property, condominiums and investments in unconsolidated affiliates and equity in earnings of unconsolidated affiliates:
Depreciation and amortization	(156,318		)	(137,890		)	(130,232		)
Impairments of real estate assets	—			(2,429		)	—
General and administrative expenses	(37,377		)	(35,727		)	(32,948		)
Interest expense	(96,114		)	(95,510		)	(92,951		)
Other income	6,380			7,363			5,657
Income from continuing operations before disposition of property, condominiums and investments in unconsolidated affiliates and equity in earnings of unconsolidated affiliates	$	45,239		$	31,398		$	34,591

__________

(1) Net of discontinued operations.

(2) Negative NOI with no corresponding revenues represents expensed real estate taxes and other carrying costs associated with land held for development that is currently zoned for the respective product type.

19. Segment Information - Continued

	December 31,
	2012		2011
Total Assets:
Office:
Atlanta, GA	$	495,175	$	359,225
Greenville, SC	69,138		69,669
Kansas City, MO	84,538		86,028
Memphis, TN	225,541		265,259
Nashville, TN	314,705		325,272
Orlando, FL	51,373		46,547
Piedmont Triad, NC	144,404		115,096
Pittsburgh, PA	330,975		227,965
Raleigh, NC	479,995		468,494
Richmond, VA	246,276		254,364
Tampa, FL	386,676		394,569
Total Office Segment	2,828,796		2,612,488
Industrial:
Atlanta, GA	115,330		133,640
Piedmont Triad, NC	76,013		78,081
Total Industrial Segment	191,343		211,721
Retail:
Kansas City, MO	166,030		170,717
Total Retail Segment	166,030		170,717
Residential:
Kansas City, MO	—		5,707
Raleigh, NC	8		4,768
Total Residential Segment	8		10,475
Corporate and other	164,251		175,591
Total Assets	$	3,350,428	$	3,180,992

Highwoods Realty Limited Partnership [Member]

Segment Reporting Information [Line Items]

Segment Information

Segment Information

Our principal business is the operation, acquisition and development of rental real estate properties. We evaluate our business by product type and by geographic location. Each product type has different customers and economic characteristics as to rental rates and terms, cost per square foot of buildings, the purposes for which customers use the space, the degree of maintenance and customer support required and customer dependency on different economic drivers, among others. The operating results by geographic grouping are also regularly reviewed by our chief operating decision maker for assessing performance and other purposes. There are no material inter-segment transactions.

Our accounting policies of the segments are the same as those used in our Consolidated Financial Statements. All operations are within the United States and, at December 31, 2012, no single customer of the Wholly Owned Properties generated more than 10.0% of our consolidated revenues on an annualized basis.

The following table summarizes the rental and other revenues and net operating income, the primary industry property-level performance metric which is defined as rental and other revenues less rental property and other expenses, for each reportable segment:

	Year Ended December 31,
	2012		2011		2010
Rental and Other Revenues: (1)
Office:
Atlanta, GA	$	61,948	$	49,521	$	44,480
Greenville, SC	13,394		14,076		13,612
Kansas City, MO	15,003		13,795		14,160
Memphis, TN	36,832		36,801		31,479
Nashville, TN	56,542		53,643		52,159
Orlando, FL	11,169		10,233		11,611
Piedmont Triad, NC	21,569		20,645		21,162
Pittsburgh, PA	38,796		10,963		—
Raleigh, NC	81,624		78,640		75,715
Richmond, VA	47,310		47,525		47,175
Tampa, FL	69,381		68,240		71,060
Total Office Segment	453,568		404,082		382,613
Industrial:
Atlanta, GA	12,805		13,266		12,335
Piedmont Triad, NC	12,518		11,827		12,372
Total Industrial Segment	25,323		25,093		24,707
Retail:
Kansas City, MO	37,211		34,269		33,516
Total Retail Segment	37,211		34,269		33,516
Total Rental and Other Revenues	$	516,102	$	463,444	$	440,836

19. Segment Information - Continued

	Year Ended December 31,
	2012			2011			2010
Net Operating Income: (1)
Office:
Atlanta, GA	$	39,335		$	31,080		$	27,641
Greenville, SC	7,618			8,334			8,152
Kansas City, MO	9,523			8,375			8,835
Memphis, TN	21,864			20,876			18,664
Nashville, TN	38,860			36,589			35,497
Orlando, FL	5,845			5,187			6,264
Piedmont Triad, NC	13,335			13,042			13,903
Pittsburgh, PA	19,548			5,450			—
Raleigh, NC	56,682			54,704			52,413
Richmond, VA	32,431			31,283			32,075
Tampa, FL	43,150			42,375			44,679
Total Office Segment	288,191			257,295			248,123
Industrial:
Atlanta, GA	9,289			9,781			8,745
Piedmont Triad, NC	9,156			8,653			9,048
Total Industrial Segment	18,445			18,434			17,793
Retail:
Kansas City, MO	22,545			20,159			19,952
Total Retail Segment	22,545			20,159			19,952
Residential:
Raleigh, NC	(178		)	(195		)	(362		)
Total Residential Segment	(178		)	(195		)	(362		)
Corporate and other (2)	(86		)	(76		)	(81		)
Total Net Operating Income	328,917			295,617			285,425
Reconciliation to income from continuing operations before disposition of property, condominiums and investments in unconsolidated affiliates and equity in earnings of unconsolidated affiliates:
Depreciation and amortization	(156,318		)	(137,890		)	(130,232		)
Impairments of real estate assets	—			(2,429		)	—
General and administrative expenses	(37,626		)	(35,753		)	(33,308		)
Interest expense	(96,114		)	(95,510		)	(92,951		)
Other income	6,380			7,363			5,657
Income from continuing operations before disposition of property, condominiums and investments in unconsolidated affiliates and equity in earnings of unconsolidated affiliates	$	45,239		$	31,398		$	34,591

__________

(1) Net of discontinued operations.

(2) Negative NOI with no corresponding revenues represents expensed real estate taxes and other carrying costs associated with land held for development that is currently zoned for the respective product type.

19. Segment Information - Continued

	December 31,
	2012		2011
Total Assets:
Office:
Atlanta, GA	$	495,175	$	359,225
Greenville, SC	69,138		69,669
Kansas City, MO	84,538		86,028
Memphis, TN	225,541		265,259
Nashville, TN	314,705		325,272
Orlando, FL	51,373		46,547
Piedmont Triad, NC	144,404		115,096
Pittsburgh, PA	330,975		227,965
Raleigh, NC	479,995		468,494
Richmond, VA	246,276		254,364
Tampa, FL	386,676		394,569
Total Office Segment	2,828,796		2,612,488
Industrial:
Atlanta, GA	115,330		133,640
Piedmont Triad, NC	76,013		78,081
Total Industrial Segment	191,343		211,721
Retail:
Kansas City, MO	166,030		170,717
Total Retail Segment	166,030		170,717
Residential:
Kansas City, MO	—		5,707
Raleigh, NC	8		4,768
Total Residential Segment	8		10,475
Corporate and other	163,348		174,483
Total Assets	$	3,349,525	$	3,179,884