Segment Information

3 Months Ended

Mar. 31, 2013

Segment Information

Segment Information

17.  Segment Information

We are a REIT engaged in owning, managing, leasing, acquiring and repositioning commercial properties in the New York Metropolitan area and have two reportable segments, real estate and debt and preferred equity investments.  We evaluate real estate performance and allocate resources based on earnings contribution to income from continuing operations.

Our real estate portfolio is primarily located in the geographical markets of the New York Metropolitan area.  The primary sources of revenue are generated from tenant rents and escalations and reimbursement revenue.  Real estate property operating expenses consist primarily of security, maintenance, utility costs, real estate taxes and ground rent expense (at certain applicable properties).  See Note 5, “Debt and Preferred Equity Investments,” for additional details on our debt and preferred equity investments.

Selected results of operations for the three months ended March 31, 2013 and 2012, and selected asset information as of March 31, 2013 and December 31, 2012, regarding our operating segments are as follows (in thousands):

	Real Estate Segment			Debt and Preferred Equity Segment		Total Company
Total revenues
Three months ended:
March 31, 2013	$	317,263		$	52,708	$	369,971
March 31, 2012	312,795			26,338		339,133
(Loss) income from continuing operations before equity in net gain on sale of unconsolidated joint venture/real estate
Three months ended:
March 31, 2013	$	(14,559	)	$	43,815	$	29,256
March 31, 2012	516			20,915		21,431
Total assets
As of:
March 31, 2013	$	13,085,589		$	1,458,376	$	14,543,965
December 31, 2012	13,021,095			1,366,659		14,387,754

Income from continuing operations represents total revenues less total expenses for the real estate segment and total investment income less allocated interest expense for the debt and preferred equity segment.  Interest costs for the debt and preferred equity segment are imputed assuming 100% leverage at our 2012 credit facility borrowing cost as well as the interest under the MRA.  We also allocate loan loss reserves, net of recoveries to the debt and preferred equity segment.  We do not allocate marketing, general and administrative expenses and transaction related costs (totaling approximately $22.4 million and $21.3 million for the three months ended March 31, 2013 and 2012, respectively) to the debt and preferred equity segment since we base performance on the individual segments prior to allocating marketing, general and administrative expenses.  All other expenses, except interest, relate entirely to the real estate assets.

There were no transactions between the above two segments.

The table below reconciles income from continuing operations to net income attributable to SL Green common stockholders for the three months ended March 31, 2013 and 2012 (in thousands):

	Three Months Ended March 31,
	2013			2012
Income from continuing operations before equity in net gain on sale of interest in unconsolidated joint venture/real estate	$	29,256		$	21,431
Equity in net gain on sale of interest in unconsolidated joint venture/real estate	—			7,260
Income from continuing operations	29,256			28,691
Net loss from discontinued operations	(32		)	(161		)
Gain on sale of discontinued operations	1,113			6,627
Net income	30,337			35,157
Net income attributable to noncontrolling interests in the Operating Partnership	(555		)	(888		)
Net income attributable to noncontrolling interests in other partnerships	(2,901		)	(1,071		)
Preferred unit distributions	(565		)	(397		)
Net income attributable to SL Green	26,316			32,801
Perpetual preferred stock dividends	(7,407		)	(7,545		)
Net income attributable to SL Green common stockholders	$	18,909		$	25,256