Segment Reporting (Notes)

9 Months Ended

Sep. 30, 2012

Segment Reporting [Abstract]

Segment Reporting

Segment Reporting

We review operating and financial data for each property on an individual basis; therefore each of our individual properties is a separate operating segment. We have aggregated our operating segments in six reportable segments based primarily upon our method of internal reporting which classifies our operations by geographical area. Our reportable segments by geographical area are as follows: (1) South Florida – including Miami-Dade, Broward and Palm Beach Counties; (2) North Florida – including all of Florida north of Palm Beach County; (3) Southeast - including Georgia, Louisiana, Alabama, Mississippi, North Carolina, South Carolina and Tennessee; (4) Northeast – including Connecticut, Maryland, Massachusetts, New York and Virginia; (5) West Coast – including California and Arizona; and (6) Other/Non-retail – which is comprised of our non-retail assets. Our segments as reported in this Quarterly Report on Form 10-Q for the period ended September 30, 2012 are not consistent with our segments as reported in our Annual Report on Form 10-K for the year ended December 31, 2011. We have divided our previously combined North Florida and Southeast region into two separate regions in this Quarterly Report on Form 10-Q for the period ended September 30, 2012, as a result of a change in management responsibilities for the North Florida region during the first quarter of 2012 and corresponding changes in our internal reporting. These changes have been reflected in our segment disclosures for all periods presented herein.

We assess a segment’s performance based on net operating income (“NOI”). NOI excludes interest and other income, acquisition costs, general and administrative expenses, interest expense, depreciation and amortization expense, gains (losses) from extinguishments of debt, income (loss) of unconsolidated joint ventures, gains on sales of real estate, impairments, and noncontrolling interests. NOI is a non-GAAP financial measure. The most directly comparable GAAP financial measure is income from continuing operations before tax and discontinued operations, which, to calculate NOI, is adjusted to add back amortization of deferred financing fees, rental property depreciation and amortization, interest expense, impairment losses, general and administrative expense, and to exclude revenue earned from management and leasing services, straight line rent adjustments, accretion of below market lease intangibles (net), gain on sale of real estate, equity in income (loss) of unconsolidated joint ventures, gain on bargain purchase and acquisition of controlling interest in subsidiary, gain (loss) on extinguishment of debt, investment income, and other income. NOI includes management fee expense recorded at each operating segment based on a percentage of revenue which is eliminated in consolidation. We use NOI internally as a performance measure and believe NOI provides useful information to investors regarding our financial condition and results of operations because it reflects only those income and expense items that are incurred at the property level. Therefore, we believe NOI is a useful measure for evaluating the operating performance of our real estate assets. NOI presented by us may not be comparable to NOI reported by other REITs that define NOI differently. We believe that in order to facilitate a clear understanding of our operating results, NOI should be examined in conjunction with income from continuing operations before tax and discontinued operations as presented in our condensed consolidated financial statements. NOI should not be considered as an alternative to net income attributable to Equity One, Inc. as an indication of our performance or to cash flows as a measure of liquidity or our ability to make distributions. We consider NOI to be an appropriate supplemental measure to net income because it helps both investors and management to understand the core operations of our properties.

The following table sets forth the financial information relating to our continuing operations presented by segments and includes a reconciliation of NOI to income from continuing operations before tax and discontinued operations, the most directly comparable GAAP financial measure:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2012			2011			2012		2011
	(In thousands)
Revenue:
South Florida	$	22,967		$	21,057		$	68,954	$	65,284
North Florida	11,117			11,874			34,016		35,761
Southeast	14,088			13,942			42,144		41,542
Northeast	12,738			8,593			35,866		25,308
West Coast	17,617			11,899			50,446		35,275
Non-retail	776			668			2,052		2,127
Total segment revenue	79,303			68,033			233,478		205,297
Add:
Straight line rent adjustment	1,131			521			3,075		2,008
Accretion of below market lease intangibles, net	3,020			1,807			9,526		5,745
Management and leasing services	499			483			1,803		1,590
Total revenue	$	83,953		$	70,844		$	247,882	$	214,640
Net operating income (NOI):
South Florida	$	15,176		$	13,572		$	46,118	$	42,300
North Florida	7,739			7,906			23,854		24,231
Southeast	10,059			9,569			29,880		28,944
Northeast	9,003			6,344			24,859		18,060
West Coast	11,505			7,572			33,164		23,158
Non-retail	281			254			955		932
Total	53,763			45,217			158,830		137,625
Add:
Straight line rent adjustment	1,131			521			3,075		2,008
Accretion of below market lease intangibles, net	3,020			1,807			9,526		5,745
Management and leasing services	499			483			1,803		1,590
Elimination of intersegment expenses	2,655			1,880			7,755		5,748
Investment income	1,586			1,515			4,615		3,175
Equity in income of unconsolidated joint ventures	469			4,426			129		4,694
Other (loss) income	(10		)	101			124		257
Gain on bargain purchase	—			—			—		30,561
Gain on sale of real estate	—			959			—		5,565
Gain on extinguishment of debt	—			—			343		255
Less:
Rental property depreciation and amortization	20,738			18,147			65,442		57,620
General and administrative	10,227			13,090			32,414		38,406
Interest expense	18,092			17,017			53,304		51,957
Amortization of deferred financing fees	627			558			1,836		1,655
Impairment loss	2,445			18,490			6,393		18,635
Income (loss) from continuing operations before tax and discontinued     operations	$	10,984		$	(10,393	)	$	26,811	$	28,950

	September 30, 2012		December 31, 2011
	(In thousands)
Assets:
South Florida	$	716,673	$	717,434
North Florida	368,705		369,540
Southeast	489,149		494,394
Northeast	846,689		645,439
West Coast	829,201		714,227
Non-retail	27,364		34,023
Corporate assets	119,187		189,016
Assets held for sale or sold	9,866		58,498
Total assets	$	3,406,834	$	3,222,571