Land, Buildings and Improvements and Assets Held for Sale (Tables)

9 Months Ended

Sep. 30, 2020

Real Estate [Abstract]

Schedule of land, building and improvements

Land and buildings leased to others, which are subject to operating leases, and real estate under construction, are summarized as follows (in thousands):

	September 30, 2020		December 31, 2019
Land	$	1,928,108	$	1,875,065
Buildings and improvements	8,454,140		7,828,439
Real estate under construction	94,817		69,604
Less: Accumulated depreciation	(1,137,357)		(950,452)
	$	9,339,708	$	8,822,656

Below is a summary of our Land, buildings and improvements attributable to operating properties (in thousands):

	September 30, 2020		December 31, 2019
Land	$	10,452	$	10,452
Buildings and improvements	73,017		72,631
Less: Accumulated depreciation	(13,315)		(11,241)
	$	70,154	$	71,842

Schedule of real estate acquired

During the nine months ended September 30, 2020, we entered into the following investments, which were deemed to be real estate asset acquisitions, at a total cost of $354.6 million, including land of $39.1 million, buildings of $253.4 million (including capitalized acquisition-related costs of $8.9 million), and net lease intangibles of $62.1 million (dollars in thousands):

Property Location(s)	Number of Properties	Date of Acquisition	Property Type	Total Capitalized Costs
Newark, United Kingdom (a)	1	1/6/2020	Warehouse	$	111,546
Aurora, Oregon (b)	1	1/24/2020	Industrial	28,755
Vojens, Denmark (a) (c)	1	1/31/2020	Warehouse	10,611
Kitzingen, Germany (a)	1	3/9/2020	Office	53,666
Knoxville, Tennessee	1	6/25/2020	Warehouse	66,045
Bluffton and Plymouth, Indiana	2	9/23/2020	Industrial	44,466
Huntley, Illinois	1	9/30/2020	Industrial	39,523
				$	354,612

__________

(a)Amount reflects the applicable exchange rate on the date of acquisition.

(b)Amount includes approximately $5.0 million in contingent consideration that will be released to the tenant/seller upon the tenant securing an easement on the property.

(c)We also recorded an estimated deferred tax liability of $0.5 million, with a corresponding increase to the asset value, since we assumed the tax basis of the acquired property

Schedule of real estate under construction

During the nine months ended September 30, 2020, we completed the following construction projects, at an aggregate cost of $168.1 million (dollars in thousands):

Property Location(s)	Primary Transaction Type	Number of Properties	Date of Completion	Property Type	Total Capitalized Costs (a)
Westborough, Massachusetts	Redevelopment	1	1/15/2020	Laboratory	$	53,060
San Antonio, Texas (b)	Build-to-Suit	1	6/25/2020	Industrial	78,726
Marktheidenfeld, Germany (c)	Expansion	1	6/30/2020	Warehouse	8,254
Azambuja, Portugal (c)	Expansion	1	9/21/2020	Warehouse	28,067
					$	168,107

__________

(a)Amount includes capitalized interest.

(b)Amount includes land of $4.0 million related to a purchase option that we expect to exercise.

(c)Amount reflects the applicable exchange rate on the date of transaction.

Schedule of operating lease income

Lease income related to operating leases recognized and included in the consolidated statements of income is as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Lease income — fixed	$	249,356	$	229,155	$	725,321	$	666,330
Lease income — variable (a)	26,871		24,304		74,424		67,917
Total operating lease income (b)	$	276,227	$	253,459	$	799,745	$	734,247

__________

(a)Includes (i) rent increases based on changes in the U.S. Consumer Price Index (“CPI”) and other comparable indices and (ii) reimbursements for property taxes, insurance, and common area maintenance services.

(b)Excludes $17.6 million and $25.4 million for the three months ended September 30, 2020 and 2019, respectively, and $56.5 million and $77.3 million for nine months ended September 30, 2020 and 2019, respectively, of interest income from direct financing leases that is included in Lease revenues in the consolidated statements of income.

Disclosure of long lived assets held-for-sale

Below is a summary of our properties held for sale (in thousands):

	September 30, 2020		December 31, 2019
Land, buildings and improvements	$	12,210	$	105,573
In-place lease intangible assets and other, net	1,233		—
Accumulated depreciation and amortization	(2,817)		(1,563)
Assets held for sale, net	$	10,626	$	104,010