(Mark One) | |
[x] | QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended March 31, 2017 |
OR |
[ ] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ____________ to ____________ |
Commission file number 001-34855 |
WHITESTONE REIT |
(Exact Name of Registrant as Specified in Its Charter) |
Maryland | 76-0594970 | |
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) |
2600 South Gessner, Suite 500 Houston, Texas | 77063 | |
(Address of Principal Executive Offices) | (Zip Code) |
Item 1. | ||||
Item 2. | ||||
Item 3. | ||||
Item 4. |
Item 1. | ||||
Item 1A. | ||||
Item 2. | ||||
Item 3. | ||||
Item 4. | ||||
Item 5. | ||||
Item 6. | ||||
March 31, 2017 | December 31, 2016 | |||||||
(unaudited) | ||||||||
ASSETS(1) | ||||||||
Real estate assets, at cost | ||||||||
Property | $ | 924,280 | $ | 920,310 | ||||
Accumulated depreciation | (112,418 | ) | (107,258 | ) | ||||
Total real estate assets | 811,862 | 813,052 | ||||||
Cash and cash equivalents | 6,503 | 4,168 | ||||||
Restricted cash | 156 | 56 | ||||||
Marketable securities | 517 | 517 | ||||||
Escrows and acquisition deposits | 5,740 | 6,620 | ||||||
Accrued rents and accounts receivable, net of allowance for doubtful accounts | 20,680 | 19,951 | ||||||
Unamortized lease commissions and loan costs | 7,857 | 8,083 | ||||||
Prepaid expenses and other assets | 3,519 | 2,762 | ||||||
Total assets | $ | 856,834 | $ | 855,209 | ||||
LIABILITIES AND EQUITY(2) | ||||||||
Liabilities: | ||||||||
Notes payable | $ | 555,399 | $ | 544,020 | ||||
Accounts payable and accrued expenses | 18,044 | 28,692 | ||||||
Tenants' security deposits | 6,279 | 6,125 | ||||||
Dividends and distributions payable | 8,883 | 8,729 | ||||||
Total liabilities | 588,605 | 587,566 | ||||||
Commitments and contingencies: | — | — | ||||||
Equity: | ||||||||
Preferred shares, $0.001 par value per share; 50,000,000 shares authorized; none issued and outstanding as of March 31, 2017 and December 31, 2016, respectively | — | — | ||||||
Common shares, $0.001 par value per share; 400,000,000 shares authorized; 29,871,458 and 29,468,563 issued and outstanding as of March 31, 2017 and December 31, 2016, respectively | 30 | 29 | ||||||
Additional paid-in capital | 403,783 | 396,494 | ||||||
Accumulated deficit | (148,828 | ) | (141,695 | ) | ||||
Accumulated other comprehensive gain | 1,565 | 859 | ||||||
Total Whitestone REIT shareholders' equity | 256,550 | 255,687 | ||||||
Noncontrolling interests: | ||||||||
Redeemable operating partnership units | 11,641 | 11,941 | ||||||
Noncontrolling interest in Consolidated Partnership | 38 | 15 | ||||||
Total noncontrolling interests | 11,679 | 11,956 | ||||||
Total equity | 268,229 | 267,643 | ||||||
Total liabilities and equity | $ | 856,834 | $ | 855,209 |
Whitestone REIT and Subsidiaries | ||||||||
CONSOLIDATED BALANCE SHEETS - Continued | ||||||||
(in thousands, except share and per share data) | ||||||||
March 31, 2017 | December 31, 2016 | |||||||
(1) Assets of consolidated Variable Interest Entities included in the total assets above: | ||||||||
Real estate assets, at cost | ||||||||
Property | $ | 94,035 | $ | 92,338 | ||||
Accumulated depreciation | (34,183 | ) | (32,533 | ) | ||||
Total real estate assets | 59,852 | 59,805 | ||||||
Cash and cash equivalents | 1,300 | 1,236 | ||||||
Escrows and acquisition deposits | 778 | 2,274 | ||||||
Accrued rents and accounts receivable, net of allowance for doubtful accounts | 2,490 | 2,313 | ||||||
Unamortized lease commissions and loan costs | 1,100 | 1,150 | ||||||
Prepaid expenses and other assets | 259 | 82 | ||||||
Total assets | $ | 65,779 | $ | 66,860 | ||||
(2) Liabilities of consolidated Variable Interest Entities included in the total liabilities above: | ||||||||
Notes payable | $ | 49,713 | $ | 50,001 | ||||
Accounts payable and accrued expenses | 1,646 | 3,481 | ||||||
Tenants' security deposits | 1,056 | 996 | ||||||
Total liabilities | $ | 52,415 | $ | 54,478 |
Three Months Ended | ||||||||
March 31, | ||||||||
2017 | 2016 | |||||||
Property revenues | ||||||||
Rental revenues | $ | 21,296 | $ | 19,422 | ||||
Other revenues | 6,971 | 6,013 | ||||||
Total property revenues | 28,267 | 25,435 | ||||||
Property expenses | ||||||||
Property operation and maintenance | 5,494 | 4,794 | ||||||
Real estate taxes | 3,920 | 3,354 | ||||||
Total property expenses | 9,414 | 8,148 | ||||||
Other expenses (income) | ||||||||
General and administrative | 6,169 | 4,836 | ||||||
Depreciation and amortization | 6,008 | 5,392 | ||||||
Interest expense | 5,153 | 4,804 | ||||||
Interest, dividend and other investment income | (138 | ) | (97 | ) | ||||
Total other expense | 17,192 | 14,935 | ||||||
Income before gain (loss) on sale or disposal of properties or assets and income taxes | 1,661 | 2,352 | ||||||
Provision for income taxes | (81 | ) | (156 | ) | ||||
Gain on sale of properties | — | 2,890 | ||||||
Gain (loss) on sale or disposal of assets | (23 | ) | 2 | |||||
Net income | 1,557 | 5,088 | ||||||
Redeemable operating partnership units | 53 | 91 | ||||||
Non-controlling interests in Consolidated Partnership | 64 | — | ||||||
Less: Net income attributable to noncontrolling interests | 117 | 91 | ||||||
Net income attributable to Whitestone REIT | $ | 1,440 | $ | 4,997 |
Three Months Ended | ||||||||
March 31, | ||||||||
2017 | 2016 | |||||||
Basic Earnings Per Share: | ||||||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares | $ | 0.05 | $ | 0.18 | ||||
Diluted Earnings Per Share: | ||||||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares | $ | 0.04 | $ | 0.18 | ||||
Weighted average number of common shares outstanding: | ||||||||
Basic | 29,416 | 26,604 | ||||||
Diluted | 30,409 | 27,489 | ||||||
Distributions declared per common share / OP unit | $ | 0.2850 | $ | 0.2850 | ||||
Consolidated Statements of Comprehensive Income (Loss) | ||||||||
Net income | $ | 1,557 | $ | 5,088 | ||||
Other comprehensive gain (loss) | ||||||||
Unrealized gain (loss) on cash flow hedging activities | 732 | (6,041 | ) | |||||
Unrealized loss on available-for-sale marketable securities | — | (5 | ) | |||||
Comprehensive income (loss) | 2,289 | (958 | ) | |||||
Less: Net income attributable to noncontrolling interests | 117 | 91 | ||||||
Less: Comprehensive income (loss) attributable to noncontrolling interests | 26 | (108 | ) | |||||
Comprehensive income (loss) attributable to Whitestone REIT | $ | 2,146 | $ | (941 | ) |
Noncontrolling Interests | ||||||||||||||||||||||||||||||||||||||
General | ||||||||||||||||||||||||||||||||||||||
Accumulated | Redeemable | Partners' | ||||||||||||||||||||||||||||||||||||
Additional | Other | Total | Operating | Interest in | ||||||||||||||||||||||||||||||||||
Common Shares | Paid-In | Accumulated | Comprehensive | Shareholders' | Partnership | Consolidated | Total | |||||||||||||||||||||||||||||||
Shares | Amount | Capital | Deficit | Loss | Equity | Units | Dollars | Partnership | Equity | |||||||||||||||||||||||||||||
Balance, December 31, 2016 | 29,468 | $ | 29 | $ | 396,494 | $ | (141,695 | ) | $ | 859 | $ | 255,687 | 1,103 | $ | 11,941 | $ | 15 | $ | 267,643 | |||||||||||||||||||
Exchange of noncontrolling interest OP units for common shares | 7 | — | 80 | — | — | 80 | (7 | ) | (80 | ) | — | — | ||||||||||||||||||||||||||
Issuance of shares under dividend reinvestment plan | 3 | — | 33 | — | — | 33 | — | — | — | 33 | ||||||||||||||||||||||||||||
Issuance of common shares, net of offering costs | 391 | 1 | 5,333 | — | — | 5,334 | — | — | — | 5,334 | ||||||||||||||||||||||||||||
Repurchase of common shares (1) | (43 | ) | — | (591 | ) | — | — | (591 | ) | — | — | — | (591 | ) | ||||||||||||||||||||||||
Share-based compensation | 45 | — | 2,447 | — | — | 2,447 | — | — | — | 2,447 | ||||||||||||||||||||||||||||
Distributions | — | — | — | (8,573 | ) | — | (8,573 | ) | — | (312 | ) | (41 | ) | (8,926 | ) | |||||||||||||||||||||||
Unrealized gain on change in value of cash flow hedge | — | — | — | — | 706 | 706 | — | 26 | — | 732 | ||||||||||||||||||||||||||||
Reallocation of ownership percentage between parent and subsidiary | — | — | (13 | ) | — | — | (13 | ) | — | 13 | — | — | ||||||||||||||||||||||||||
Net income | — | — | — | 1,440 | — | 1,440 | — | 53 | 64 | 1,557 | ||||||||||||||||||||||||||||
Balance, March 31, 2017 | 29,871 | $ | 30 | $ | 403,783 | $ | (148,828 | ) | $ | 1,565 | $ | 256,550 | 1,096 | $ | 11,641 | $ | 38 | $ | 268,229 |
(1) | During the three months ended March 31, 2017, the Company acquired common shares held by employees who tendered owned common shares to satisfy the tax withholding on the lapse of certain restrictions on restricted common shares. |
Three Months Ended | ||||||||
March 31, | ||||||||
2017 | 2016 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 1,557 | $ | 5,088 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 6,008 | 5,392 | ||||||
Amortization of deferred loan costs | 310 | 315 | ||||||
Amortization of notes payable discount | 149 | 72 | ||||||
Loss (gain) on sale or disposal of assets and properties | 23 | (2,892 | ) | |||||
Bad debt expense | 609 | 372 | ||||||
Share-based compensation | 2,447 | 2,025 | ||||||
Changes in operating assets and liabilities: | ||||||||
Escrows and acquisition deposits | 880 | 1,853 | ||||||
Accrued rent and accounts receivable | (1,338 | ) | (1,377 | ) | ||||
Unamortized lease commissions | (383 | ) | (382 | ) | ||||
Prepaid expenses and other assets | 444 | 191 | ||||||
Accounts payable and accrued expenses | (9,977 | ) | (5,161 | ) | ||||
Tenants' security deposits | 154 | 180 | ||||||
Net cash provided by operating activities | 883 | 5,676 | ||||||
Cash flows from investing activities: | ||||||||
Additions to real estate | (4,556 | ) | (4,364 | ) | ||||
Proceeds from sales of properties | — | 1,097 | ||||||
Net cash used in investing activities | (4,556 | ) | (3,267 | ) | ||||
Cash flows from financing activities: | ||||||||
Distributions paid to common shareholders | (8,453 | ) | (7,711 | ) | ||||
Distributions paid to OP unit holders | (313 | ) | (139 | ) | ||||
Proceeds from issuance of common shares, net of offering costs | 5,334 | — | ||||||
Proceeds from revolving credit facility | 11,000 | 7,000 | ||||||
Repayments of notes payable | (869 | ) | (739 | ) | ||||
Change in restricted cash | (100 | ) | (89 | ) | ||||
Repurchase of common shares | (591 | ) | (871 | ) | ||||
Net cash provided by (used in) financing activities | 6,008 | (2,549 | ) | |||||
Net increase (decrease) in cash and cash equivalents | 2,335 | (140 | ) | |||||
Cash and cash equivalents at beginning of period | 4,168 | 2,587 | ||||||
Cash and cash equivalents at end of period | $ | 6,503 | $ | 2,447 |
Three Months Ended | ||||||||
March 31, | ||||||||
2017 | 2016 | |||||||
Supplemental disclosure of cash flow information: | ||||||||
Cash paid for interest | $ | 4,936 | $ | 4,602 | ||||
Non cash investing and financing activities: | ||||||||
Disposal of fully depreciated real estate | $ | 70 | $ | 187 | ||||
Financed insurance premiums | $ | 1,115 | $ | 1,060 | ||||
Value of shares issued under dividend reinvestment plan | $ | 33 | $ | 27 | ||||
Value of common shares exchanged for OP units | $ | 80 | $ | 98 | ||||
Change in fair value of available-for-sale securities | $ | — | $ | (5 | ) | |||
Change in fair value of cash flow hedge | $ | 732 | $ | (6,041 | ) | |||
Proceeds from 1031 exchange transaction | $ | — | $ | 2,860 | ||||
Reallocation of ownership percentage between parent and subsidiary | $ | 13 | $ | — | ||||
Accrued distribution payable to General Partners' Interest in Consolidated Partnership | $ | 41 | $ | — |
March 31, 2017 | ||||||||||||||||
Amortized Cost | Gains in Accumulated Other Comprehensive Income (Loss) | Losses in Accumulated Other Comprehensive Income (Loss) | Estimated Fair Value | |||||||||||||
Real estate sector common stock | $ | 654 | $ | — | $ | (137 | ) | $ | 517 | |||||||
Total available-for-sale securities | $ | 654 | $ | — | $ | (137 | ) | $ | 517 |
December 31, 2016 | ||||||||||||||||
Amortized Cost | Gains in Accumulated Other Comprehensive Income (Loss) | Losses in Accumulated Other Comprehensive Income (Loss) | Estimated Fair Value | |||||||||||||
Real estate sector common stock | $ | 654 | $ | — | $ | (137 | ) | $ | 517 | |||||||
Total available-for-sale securities | $ | 654 | $ | — | $ | (137 | ) | $ | 517 |
March 31, 2017 | December 31, 2016 | |||||||
Tenant receivables | $ | 13,498 | $ | 12,972 | ||||
Accrued rents and other recoveries | 14,929 | 14,237 | ||||||
Allowance for doubtful accounts | (7,747 | ) | (7,258 | ) | ||||
Total | $ | 20,680 | $ | 19,951 |
March 31, 2017 | December 31, 2016 | |||||||
Leasing commissions | $ | 8,789 | $ | 8,720 | ||||
Deferred legal cost | 219 | — | ||||||
Deferred financing cost | 4,071 | 4,071 | ||||||
Total cost | 13,079 | 12,791 | ||||||
Less: leasing commissions accumulated amortization | (3,856 | ) | (3,597 | ) | ||||
Less: deferred legal cost accumulated amortization | (17 | ) | — | |||||
Less: deferred financing cost accumulated amortization | (1,349 | ) | (1,111 | ) | ||||
Total cost, net of accumulated amortization | $ | 7,857 | $ | 8,083 |
March 31, 2017 | December 31, 2016 | |||||||
Real estate assets, at cost | ||||||||
Property | $ | 94,035 | $ | 92,338 | ||||
Accumulated depreciation | (34,183 | ) | (32,533 | ) | ||||
Total real estate assets | 59,852 | 59,805 | ||||||
Cash and cash equivalents | 1,300 | 1,236 | ||||||
Escrows and acquisition deposits | 778 | 2,274 | ||||||
Accrued rents and accounts receivable, net of allowance for doubtful accounts(1) | 2,490 | 2,313 | ||||||
Unamortized lease commissions and loan costs | 1,100 | 1,150 | ||||||
Prepaid expenses and other assets(2) | 259 | 82 | ||||||
Total assets | $ | 65,779 | $ | 66,860 | ||||
Liabilities | ||||||||
Notes payable(3) | $ | 49,713 | $ | 50,001 | ||||
Accounts payable and accrued expenses(4) | 1,646 | 3,481 | ||||||
Tenants' security deposits | 1,056 | 996 | ||||||
Total liabilities | $ | 52,415 | $ | 54,478 |
(1) | Excludes approximately $2.0 million and $0.5 million in accounts receivable due from Whitestone that were eliminated in consolidation as of March 31, 2017 and December 31, 2016, respectively. |
(2) | Excludes approximately $0.0 million and $0.9 million in prepaid expenses due from Whitestone that were eliminated in consolidation as of March 31, 2017 and December 31, 2016, respectively. |
(3) | Excludes approximately $15.5 million and $15.5 million in notes payable due to Whitestone that were eliminated in consolidation as of March 31, 2017 and December 31, 2016, respectively. |
(4) | Excludes approximately $1.0 million and $0.3 million in accounts payable due to Whitestone that were eliminated in consolidation as of March 31, 2017 and December 31, 2016, respectively. |
Description | March 31, 2017 | December 31, 2016 | ||||||
Fixed rate notes | ||||||||
$10.5 million, LIBOR plus 2.00% Note, due September 24, 2018 (1) | $ | 9,920 | $ | 9,980 | ||||
$50.0 million, 0.84% plus 1.35% to 1.90% Note, due October 30, 2020 (2) | 50,000 | 50,000 | ||||||
$50.0 million, 1.50% plus 1.35% to 1.90% Note, due January 29, 2021 (3) | 50,000 | 50,000 | ||||||
$100.0 million, 1.73% plus 1.65% to 2.25% Note, due October 30, 2022 (4) | 100,000 | 100,000 | ||||||
$37.0 million 3.76% Note, due December 1, 2020 (5) | 33,915 | 34,166 | ||||||
$6.5 million 3.80% Note, due January 1, 2019 | 5,975 | 6,019 | ||||||
$19.0 million 4.15% Note, due December 1, 2024 | 19,000 | 19,000 | ||||||
$20.2 million 4.28% Note, due June 6, 2023 | 19,620 | 19,708 | ||||||
$14.0 million 4.34% Note, due September 11, 2024 | 14,000 | 14,000 | ||||||
$14.3 million 4.34% Note, due September 11, 2024 | 14,300 | 14,300 | ||||||
$16.5 million 4.97% Note, due September 26, 2023 (5) | 16,236 | 16,298 | ||||||
$15.1 million 4.99% Note, due January 6, 2024 | 15,022 | 15,060 | ||||||
$9.2 million, Prime Rate less 2.00% Note, due December 29, 2017 (6) | 7,860 | 7,869 | ||||||
$2.6 million 5.46% Note, due October 1, 2023 | 2,502 | 2,512 | ||||||
$1.1 million 2.97% Note, due November 28, 2017 | 869 | — | ||||||
Floating rate notes | ||||||||
Unsecured line of credit, LIBOR plus 1.40% to 1.95%, due October 30, 2019 (7) | 197,600 | 186,600 | ||||||
Total notes payable principal | 556,819 | 545,512 | ||||||
Less deferred financing costs, net of accumulated amortization | (1,420 | ) | (1,492 | ) | ||||
Total notes payable | $ | 555,399 | $ | 544,020 |
(1) | Promissory note includes an interest rate swap that fixed the interest rate at 3.55% for the duration of the term. |
(2) | Promissory note includes an interest rate swap that fixed the LIBOR portion of Term Loan 1 (as defined below) at 0.84% through February 3, 2017 and 1.75% beginning February 3, 2017 through October 30, 2020. |
(3) | Promissory note includes an interest rate swap that fixed the LIBOR portion of Term Loan 2 (as defined below) at 1.50%. |
(4) | Promissory note includes an interest rate swap that fixed the LIBOR portion of Term Loan 3 (as defined below) at 1.73%, |
(5) | Promissory notes were assumed by Pillarstone in December 2016. |
(6) | Promissory note includes an interest rate swap that fixed the interest rate at 5.72% for the duration of the term. As part of our acquisition of Paradise Plaza in August 2012, we recorded a discount on the note of $1.3 million, which amortizes into interest expense over the life of the loan and results in an imputed interest rate of 4.13%. |
(7) | Unsecured line of credit includes certain Pillarstone Properties. |
• | extended the maturity date of the $300 million unsecured revolving credit facility under the 2014 Facility (the “Revolver”) to October 30, 2019 from November 7, 2018; |
• | converted $100 million of outstanding borrowings under the Revolver to a new $100 million unsecured term loan under the 2014 Facility (“Term Loan 3”) with a maturity date of October 30, 2022; |
• | extended the maturity date of the first $50 million unsecured term loan under the 2014 Facility (“Term Loan 1”) to October 30, 2020 from February 17, 2017; and |
• | extended the maturity date of the second $50 million unsecured term loan under the 2014 Facility (“Term Loan 2” and together with Term Loan 1 and Term Loan 3, the “Term Loans”) to January 29, 2021 from November 7, 2019. |
Year | Amount Due | |||
2017 | $ | 10,562 | ||
2018 | 12,136 | |||
2019 | 205,649 | |||
2020 | 82,827 | |||
2021 | 51,918 | |||
Thereafter | 193,727 | |||
Total | $ | 556,819 |
Balance Sheet Location | Estimated Fair Value | |||||
Interest rate swaps: | ||||||
March 31, 2017 | Accounts payable and accrued expenses | $ | (1,482 | ) | ||
December 31, 2016 | Accounts payable and accrued expenses | $ | (662 | ) |
Amount Recognized as Comprehensive Income (Loss) | Location of Loss Recognized in Earnings | Amount of Loss Recognized in Earnings (1) | ||||||||
Three months ended March 31, 2017 | $ | 732 | Interest expense | $ | (508 | ) | ||||
Three months ended March 31, 2016 | $ | (6,041 | ) | Interest expense | $ | (594 | ) |
(1) | There was no ineffective portion of our interest rate swaps to recognize in earnings for the three months ended March 31, 2017 and 2016. |
Three Months Ended | ||||||||
March 31, | ||||||||
(in thousands, except per share data) | 2017 | 2016 | ||||||
Numerator: | ||||||||
Net income | $ | 1,557 | $ | 5,088 | ||||
Less: Net income attributable to noncontrolling interests | (117 | ) | (91 | ) | ||||
Distributions paid on unvested restricted shares | (91 | ) | (155 | ) | ||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares | $ | 1,349 | $ | 4,842 | ||||
Denominator: | ||||||||
Weighted average number of common shares - basic | 29,416 | 26,604 | ||||||
Effect of dilutive securities: | ||||||||
Unvested restricted shares | 993 | 885 | ||||||
Weighted average number of common shares - dilutive | 30,409 | 27,489 | ||||||
Earnings Per Share: | ||||||||
Basic: | ||||||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares | $ | 0.05 | $ | 0.18 | ||||
Diluted: | ||||||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares | $ | 0.04 | $ | 0.18 |
Common Shares | Noncontrolling OP Unit Holders | Total | ||||||||||||||||||
Quarter Paid | Distributions Per Common Share | Amount Paid | Distributions Per OP Unit | Amount Paid | Amount Paid | |||||||||||||||
2017 | ||||||||||||||||||||
First Quarter | $ | 0.2850 | $ | 8,453 | $ | 0.2850 | $ | 313 | $ | 8,766 | ||||||||||
Total | $ | 0.2850 | $ | 8,453 | $ | 0.2850 | $ | 313 | $ | 8,766 | ||||||||||
2016 | ||||||||||||||||||||
Fourth Quarter | $ | 0.2850 | $ | 8,305 | $ | 0.2850 | $ | 314 | $ | 8,619 | ||||||||||
Third Quarter | 0.2850 | 8,109 | 0.2850 | 138 | 8,247 | |||||||||||||||
Second Quarter | 0.2850 | 7,786 | 0.2850 | 138 | 7,924 | |||||||||||||||
First Quarter | 0.2850 | 7,711 | 0.2850 | 139 | 7,850 | |||||||||||||||
Total | $ | 1.1400 | $ | 31,911 | $ | 1.1400 | $ | 729 | $ | 32,640 |
Shares | Weighted Average Grant Date Fair Value | ||||||
Non-vested at January 1, 2017 | 2,044,334 | $ | 14.48 | ||||
Granted | 23,200 | 13.91 | |||||
Vested | (102,448 | ) | 14.63 | ||||
Forfeited | (5,951 | ) | 13.66 | ||||
Non-vested at March 31, 2017 | 1,959,135 | $ | 14.46 | ||||
Available for grant at March 31, 2017 | 890,449 |
Shares Granted | Shares Vested | |||||||||||||
Non-Vested Shares Issued | Weighted Average Grant-Date Fair Value | Vested Shares | Total Vest-Date Fair Value | |||||||||||
(in thousands) | ||||||||||||||
Three Months Ended March 31, 2017 | 23,200 | $ | 13.91 | (102,448 | ) | $ | 1,499 | |||||||
Year Ended December 31, 2016 | 545,778 | $ | 14.85 | (734,261 | ) | 10,577 | ||||||||
Year Ended December 31, 2015 | 327,122 | 13.49 | (348,786 | ) | 4,969 | |||||||||
Year Ended December 31, 2014 | 2,058,930 | 14.40 | (133,774 | ) | 1,721 |
• | the imposition of federal taxes if we fail to qualify as a REIT in any taxable year or forego an opportunity to ensure REIT status; |
• | uncertainties related to the national economy, the real estate industry in general and in our specific markets; |
• | legislative or regulatory changes, including changes to laws governing REITs; |
• | adverse economic or real estate developments in Texas, Arizona or Illinois; |
• | increases in interest rates and operating costs; |
• | availability and terms of capital and financing, both to fund our operations and to refinance our indebtedness as it matures; |
• | decreases in rental rates or increases in vacancy rates; |
• | litigation risks; |
• | lease-up risks, including leasing risks arising from exclusivity and consent provisions in leases with significant tenants; |
• | our ability to successfully finance and complete our pending acquisitions and related development projects and, if completed, the ability of such newly acquired and new development properties to perform as we expect; |
• | our inability to renew tenant leases or obtain new tenant leases upon the expiration of existing leases; |
• | our inability to generate sufficient cash flows due to market conditions, competition, uninsured losses, changes in tax or other applicable laws; and |
• | the need to fund tenant improvements or other capital expenditures out of operating cash flow. |
• | 47 wholly-owned properties that meet our Community Centered Properties™ strategy containing approximately 4.4 million square feet of gross leasable area (“GLA”) and having a total carrying amount (net of accumulated depreciation) of $695.7 million; and |
• | as a result of the Contribution (as defined below), a majority interest in 14 consolidated properties that do not meet our Community Centered Properties™ strategy containing approximately 1.5 million square feet of GLA and having a total carrying amount (net of accumulated depreciation) of $60.3 million; and |
• | four retail properties that meet our Community Centered Properties™ strategy containing approximately 0.2 million square feet of GLA and having a total carrying value (net of accumulated depreciation) of $50.7 million; and |
• | four parcels of land held for future development having a total carrying value of $5.2 million. |
Number of Leases Signed | GLA Signed | Weighted Average Lease Term (2) | TI and Incentives per Sq. Ft. (3) | Contractual Rent Per Sq. Ft (4) | Prior Contractual Rent Per Sq. Ft. (5) | Straight-lined Basis Increase Over Prior Rent | ||||||||||||||||||
Comparable (1) | ||||||||||||||||||||||||
Renewal Leases | 58 | 159,722 | 3.1 | $ | 1.36 | $ | 15.86 | $ | 15.53 | 7.8 | % | |||||||||||||
New Leases | 11 | 20,109 | 4.4 | 4.80 | 17.82 | 17.78 | 3.3 | % | ||||||||||||||||
Total | 69 | 179,831 | 3.3 | $ | 1.74 | $ | 16.08 | $ | 15.78 | 7.2 | % | |||||||||||||
Number of Leases Signed | GLA Signed | Weighted Average Lease Term (2) | TI and Incentives per Sq. Ft. (3) | Contractual Rent Per Sq. Ft (4) | ||||||||||||||||||||
Non-Comparable | ||||||||||||||||||||||||
Renewal Leases | 3 | 10,590 | 3.9 | $ | 8.37 | $ | 20.93 | |||||||||||||||||
New Leases | 19 | 31,472 | 5.7 | 13.64 | 24.94 | |||||||||||||||||||
Total | 22 | 42,062 | 5.3 | $ | 12.31 | $ | 23.93 |
(1) | Comparable leases represent leases signed on spaces for which there was a former tenant within the last twelve months and the new or renewal square footage was within 25% of the expired square footage. |
(2) | Weighted average lease term is determined on the basis of square footage. |
(3) | Estimated amount per signed leases. Actual cost of construction may vary. Does not include first generation costs for tenant improvements (“TI”) and leasing commission costs needed for new acquisitions or redevelopment of a property to bring to operating standards for its intended use. |
(4) | Contractual minimum rent under the new lease for the first month, excluding concessions. |
(5) | Contractual minimum rent under the prior lease for the final month. |
Three Months Ended | ||||||||
March 31, | ||||||||
2017 | 2016 | |||||||
Capital expenditures: | ||||||||
Tenant improvements and allowances | $ | 1,554 | $ | 1,084 | ||||
Developments / redevelopments | 2,242 | 2,689 | ||||||
Leasing commissions and costs | 454 | 436 | ||||||
Maintenance capital expenditures | 760 | 591 | ||||||
Total capital expenditures | $ | 5,010 | $ | 4,800 |
Three Months Ended March 31, | ||||||||
2017 | 2016 | |||||||
Number of properties wholly-owned and operated | 55 | 55 | ||||||
Aggregate GLA (sq. ft.)(1) | 4,584,488 | 4,350,017 | ||||||
Ending occupancy rate - wholly-owned operating portfolio(1) | 89 | % | 89 | % | ||||
Ending occupancy rate - all wholly-owned properties | 88 | % | 88 | % | ||||
Number of properties managed and consolidated | 14 | 14 | ||||||
Aggregate GLA (sq. ft.) | 1,531,737 | 1,531,737 | ||||||
Ending occupancy rate - managed and consolidated operating portfolio | 80 | % | 84 | % | ||||
Total property revenues | $ | 28,267 | $ | 25,435 | ||||
Total property expenses | 9,414 | 8,148 | ||||||
Total other expenses | 17,192 | 14,935 | ||||||
Provision for income taxes | 81 | 156 | ||||||
Gain on sale of properties | — | (2,890 | ) | |||||
Loss (gain) on disposal of assets | 23 | (2 | ) | |||||
Net income | 1,557 | 5,088 | ||||||
Less: Net income attributable to noncontrolling interests | 117 | 91 | ||||||
Net income attributable to Whitestone REIT | $ | 1,440 | $ | 4,997 | ||||
Funds from operations core (2) | $ | 10,179 | $ | 9,702 | ||||
Property net operating income (3) | 18,853 | 17,287 | ||||||
Distributions paid on common shares and OP units | 8,766 | 7,850 | ||||||
Distributions per common share and OP unit | $ | 0.2850 | $ | 0.2850 | ||||
Distributions paid as a percentage of funds from operations core | 86 | % | 81 | % |
(1) | Excludes (i) new acquisitions, through the earlier of attainment of 90% occupancy or 18 months of ownership, and (ii) properties that are undergoing significant redevelopment or re-tenanting. |
(2) | For a reconciliation of funds from operations core to net income, see “—Reconciliation of Non-GAAP Financial Measures—Funds From Operations (“FFO”) Core” below. |
(3) | For a reconciliation of property net operating income to net income, see “—Reconciliation of Non-GAAP Financial Measures—Property Net Operating Income (“NOI”)” below. |
Three Months Ended March 31, | |||||||||||||||
Overall Property Expenses | 2017 | 2016 | Change | % Change | |||||||||||
Real estate taxes | $ | 3,920 | $ | 3,354 | $ | 566 | 17 | % | |||||||
Utilities | 1,236 | 1,096 | 140 | 13 | % | ||||||||||
Contract services | 1,636 | 1,424 | 212 | 15 | % | ||||||||||
Repairs and maintenance | 1,127 | 956 | 171 | 18 | % | ||||||||||
Bad debt | 609 | 374 | 235 | 63 | % | ||||||||||
Labor and other | 886 | 944 | (58 | ) | (6 | )% | |||||||||
Total property expenses | $ | 9,414 | $ | 8,148 | $ | 1,266 | 16 | % |
Three Months Ended March 31, | |||||||||||||||
Same Store Property Expenses | 2017 | 2016 | Change | % Change | |||||||||||
Real estate taxes | $ | 3,167 | $ | 2,809 | $ | 358 | 13 | % | |||||||
Utilities | 844 | 804 | 40 | 5 | % | ||||||||||
Contract services | 1,215 | 1,165 | 50 | 4 | % | ||||||||||
Repairs and maintenance | 869 | 743 | 126 | 17 | % | ||||||||||
Bad debt | 544 | 364 | 180 | 49 | % | ||||||||||
Labor and other | 715 | 711 | 4 | 1 | % | ||||||||||
Total property expenses | $ | 7,354 | $ | 6,596 | $ | 758 | 11 | % |
Three Months Ended March 31, | ||||||||||||||
Non-Same Store Property Expenses | 2017 | 2016 | Change | % Change | ||||||||||
Real estate taxes | $ | 113 | $ | 30 | $ | 83 | Not meaningful | |||||||
Utilities | 68 | 15 | 53 | Not meaningful | ||||||||||
Contract services | 113 | 11 | 102 | Not meaningful | ||||||||||
Repairs and maintenance | 52 | 1 | 51 | Not meaningful | ||||||||||
Bad debt | 19 | (17 | ) | 36 | Not meaningful | |||||||||
Labor and other | 54 | 47 | 7 | Not meaningful | ||||||||||
Total property expenses | $ | 419 | $ | 87 | $ | 332 | Not meaningful |
Three Months Ended March 31, | Percent | ||||||||||||||
2017 | 2016 | Change | Change | ||||||||||||
Same Store (49 properties, exclusive of land held for development) | |||||||||||||||
Property revenues | |||||||||||||||
Rental revenues | $ | 16,668 | $ | 16,083 | $ | 585 | 4 | % | |||||||
Other revenues | 5,765 | 5,331 | 434 | 8 | % | ||||||||||
Total property revenues | 22,433 | 21,414 | 1,019 | 5 | % | ||||||||||
Property expenses | |||||||||||||||
Property operation and maintenance | 4,187 | 3,787 | 400 | 11 | % | ||||||||||
Real estate taxes | 3,167 | 2,809 | 358 | 13 | % | ||||||||||
Total property expenses | 7,354 | 6,596 | 758 | 11 | % | ||||||||||
Total Same Store net operating income | 15,079 | 14,818 | 261 | 2 | % | ||||||||||
Non-Same Store (2 Properties, exclusive of land held for development) | |||||||||||||||
Property revenues | |||||||||||||||
Rental revenues | 1,401 | 148 | 1,253 | Not meaningful | |||||||||||
Other revenues | 601 | 64 | 537 | Not meaningful | |||||||||||
Total property revenues | 2,002 | 212 | 1,790 | Not meaningful | |||||||||||
Property expenses | |||||||||||||||
Property operation and maintenance | 306 | 57 | 249 | Not meaningful | |||||||||||
Real estate taxes | 113 | 30 | 83 | Not meaningful | |||||||||||
Total property expenses | 419 | 87 | 332 | Not meaningful | |||||||||||
Total Non-Same Store net operating income | 1,583 | 125 | 1,458 | Not meaningful | |||||||||||
Consolidated Partnership properties (14 Properties) | |||||||||||||||
Property revenues | |||||||||||||||
Rental revenues | 3,227 | 3,191 | 36 | 1 | % | ||||||||||
Other revenues | 605 | 618 | (13 | ) | (2 | )% | |||||||||
Total property revenues | 3,832 | 3,809 | 23 | 1 | % | ||||||||||
Property expenses | |||||||||||||||
Property operation and maintenance | 1,001 | 950 | 51 | 5 | % | ||||||||||
Real estate taxes | 640 | 515 | 125 | 24 | % | ||||||||||
Total property expenses | 1,641 | 1,465 | 176 | 12 | % | ||||||||||
Total Consolidated Partnership properties net operating income | 2,191 | 2,344 | (153 | ) | (7 | )% | |||||||||
Total property net operating income | 18,853 | 17,287 | 1,566 | 9 | % | ||||||||||
Less total other expenses, provision for income taxes, gain on sale of properties and loss on disposal of assets | 17,296 | 12,199 | 5,097 | 42 | % | ||||||||||
Net income | $ | 1,557 | $ | 5,088 | $ | (3,531 | ) | (69 | )% |
Three Months Ended | |||||||||||||||
March 31, | |||||||||||||||
2017 | 2016 | Change | % Change | ||||||||||||
General and administrative | $ | 6,169 | $ | 4,836 | $ | 1,333 | 28 | % | |||||||
Depreciation and amortization | 6,008 | 5,392 | 616 | 11 | % | ||||||||||
Interest expense | 5,153 | 4,804 | 349 | 7 | % | ||||||||||
Interest, dividend and other investment income | (138 | ) | (97 | ) | (41 | ) | 42 | % | |||||||
Total other expenses | $ | 17,192 | $ | 14,935 | $ | 2,257 | 15 | % |
Three Months Ended | ||||||||
March 31, | ||||||||
FFO AND FFO CORE | 2017 | 2016 | ||||||
Net income attributable to Whitestone REIT | $ | 1,440 | $ | 4,997 | ||||
Adjustments to reconcile to FFO:(1) | ||||||||
Depreciation and amortization of real estate assets | 5,795 | 5,311 | ||||||
(Gain) loss on sale or disposal of assets and properties | 22 | (2,892 | ) | |||||
Net income attributable to noncontrolling interests | 53 | 91 | ||||||
FFO | 7,310 | 7,507 | ||||||
Adjustments to reconcile to FFO Core: | ||||||||
Share-based compensation expense | 2,451 | 2,025 | ||||||
Acquisition costs | 418 | 170 | ||||||
FFO Core | $ | 10,179 | $ | 9,702 |
(1) | Includes pro-rata share attributable to Pillarstone. |
Three Months Ended | ||||||||
March 31, | ||||||||
PROPERTY NET OPERATING INCOME | 2017 | 2016 | ||||||
Net income attributable to Whitestone REIT | $ | 1,440 | $ | 4,997 | ||||
General and administrative expenses | 6,169 | 4,836 | ||||||
Depreciation and amortization | 6,008 | 5,392 | ||||||
Interest expense | 5,153 | 4,804 | ||||||
Interest, dividend and other investment income | (138 | ) | (97 | ) | ||||
Provision for income taxes | 81 | 156 | ||||||
Gain on sale of properties | — | (2,890 | ) | |||||
(Gain) loss on disposal of assets | 23 | (2 | ) | |||||
Net income attributable to noncontrolling interests | 117 | 91 | ||||||
NOI | $ | 18,853 | $ | 17,287 |
• | Cash flow from operations of $883,000 for the three months ended March 31, 2017; |
• | Proceeds of $11,000,000 from the Facility; |
• | Net proceeds of $5,334,000 from issuance of common shares; |
• | Payment of distributions to common shareholders and OP unit holders of $8,766,000; |
• | Additions to real estate of $4,556,000; |
• | Change in restricted cash of $100,000; |
• | Repurchase of common shares of $591,000; and |
• | Payments of notes payable of $869,000. |
Description | March 31, 2017 | December 31, 2016 | ||||||
Fixed rate notes | ||||||||
$10.5 million, LIBOR plus 2.00% Note, due September 24, 2018 (1) | $ | 9,920 | $ | 9,980 | ||||
$50.0 million, 0.84% plus 1.35% to 1.90% Note, due October 30, 2020 (2) | 50,000 | 50,000 | ||||||
$50.0 million, 1.50% plus 1.35% to 1.90% Note, due January 29, 2021 (3) | 50,000 | 50,000 | ||||||
$100.0 million, 1.73% plus 1.65% to 2.25% Note, due October 30, 2022 (4) | 100,000 | 100,000 | ||||||
$37.0 million 3.76% Note, due December 1, 2020 (5) | 33,915 | 34,166 | ||||||
$6.5 million 3.80% Note, due January 1, 2019 | 5,975 | 6,019 | ||||||
$19.0 million 4.15% Note, due December 1, 2024 | 19,000 | 19,000 | ||||||
$20.2 million 4.28% Note, due June 6, 2023 | 19,620 | 19,708 | ||||||
$14.0 million 4.34% Note, due September 11, 2024 | 14,000 | 14,000 | ||||||
$14.3 million 4.34% Note, due September 11, 2024 | 14,300 | 14,300 | ||||||
$16.5 million 4.97% Note, due September 26, 2023 (5) | 16,236 | 16,298 | ||||||
$15.1 million 4.99% Note, due January 6, 2024 | 15,022 | 15,060 | ||||||
$9.2 million, Prime Rate less 2.00% Note, due December 29, 2017 (6) | 7,860 | 7,869 | ||||||
$2.6 million 5.46% Note, due October 1, 2023 | 2,502 | 2,512 | ||||||
$1.1 million 2.97% Note, due November 28, 2017 | 869 | — | ||||||
Floating rate notes | ||||||||
Unsecured line of credit, LIBOR plus 1.40% to 1.95%, due October 30, 2019 (7) | 197,600 | 186,600 | ||||||
Total notes payable principal | 556,819 | 545,512 | ||||||
Less deferred financing costs, net of accumulated amortization | (1,420 | ) | (1,492 | ) | ||||
$ | 555,399 | $ | 544,020 |
(1) | Promissory note includes an interest rate swap that fixed the interest rate at 3.55% for the duration of the term. |
(2) | Promissory note includes an interest rate swap that fixed the LIBOR portion of Term Loan 1 (as defined below) at 0.84% through February 3, 2017 and 1.75% beginning February 3, 2017 through October 30, 2020. |
(3) | Promissory note includes an interest rate swap that fixed the LIBOR portion of Term Loan 2 (as defined below) at 1.50%. |
(4) | Promissory note includes an interest rate swap that fixed the LIBOR portion of Term Loan 3 (as defined below) at 1.73%, |
(5) | Promissory notes were assumed by Pillarstone in December 2016. |
(6) | Promissory note includes an interest rate swap that fixed the interest rate at 5.72% for the duration of the term. As part of our acquisition of Paradise Plaza in August 2012, we recorded a discount on the note of $1.3 million, which amortizes into interest expense over the life of the loan and results in an imputed interest rate of 4.13%. |
(7) | Unsecured line of credit includes certain Pillarstone Properties. |
• | extended the maturity date of the $300 million unsecured revolving credit facility under the 2014 Facility (the “Revolver”) to October 30, 2019 from November 7, 2018; |
• | converted $100 million of outstanding borrowings under the Revolver to a new $100 million unsecured term loan under the 2014 Facility (“Term Loan 3”) with a maturity date of October 30, 2022; |
• | extended the maturity date of the first $50 million unsecured term loan under the 2014 Facility (“Term Loan 1”) to October 30, 2020 from February 17, 2017; and |
• | extended the maturity date of the second $50 million unsecured term loan under the 2014 Facility (“Term Loan 2” and together with Term Loan 1 and Term Loan 3, the “Term Loans”) to January 29, 2021 from November 7, 2019. |
Year | Amount Due | |||
2017 | $ | 10,562 | ||
2018 | 12,136 | |||
2019 | 205,649 | |||
2020 | 82,827 | |||
2021 | 51,918 | |||
Thereafter | 193,727 | |||
Total | $ | 556,819 |
Common Shares | Noncontrolling OP Unit Holders | Total | ||||||||||||||||||
Quarter Paid | Distributions Per Common Share | Amount Paid | Distributions Per OP Unit | Amount Paid | Amount Paid | |||||||||||||||
2017 | ||||||||||||||||||||
First Quarter | $ | 0.2850 | $ | 8,453 | $ | 0.2850 | $ | 313 | $ | 8,766 | ||||||||||
Total | $ | 0.2850 | $ | 8,453 | $ | 0.2850 | $ | 313 | $ | 8,766 | ||||||||||
2016 | ||||||||||||||||||||
Fourth Quarter | $ | 0.2850 | $ | 8,305 | $ | 0.2850 | $ | 314 | $ | 8,619 | ||||||||||
Third Quarter | 0.2850 | 8,109 | 0.2850 | 138 | 8,247 | |||||||||||||||
Second Quarter | 0.2850 | 7,786 | 0.2850 | 138 | 7,924 | |||||||||||||||
First Quarter | 0.2850 | 7,711 | 0.2850 | 139 | 7,850 | |||||||||||||||
Total | $ | 1.1400 | $ | 31,911 | $ | 1.1400 | $ | 729 | $ | 32,640 |
• | market conditions in the submarkets in which Eldorado Plaza and BLVD Place are located may result in higher than expected vacancy rates and lower than expected rental rates; |
• | Eldorado Plaza and BLVD Place may be subject to reassessment, which may result in higher than expected tax payments; |
• | we may have underestimated the costs to make any necessary improvements to Eldorado Plaza and BLVD Place; and |
• | we may encounter unanticipated problems, expenses and liabilities in connection with the development of the land parcels included in Eldorado Plaza and BLVD Place and, as a result, may be unable to realize the rental revenues expected to be received from the developable GLA on the timelines or at the rates we anticipate, if at all. |
(a) | During the period covered by this Form 10-Q, we did not sell any equity securities that were not registered under the Securities Act of 1933, as amended. |
(b) | Not applicable. |
(c) | Issuer Purchases of Equity Securities |
Period | Total Number of Shares Purchased (1) | Average Price Paid for Shares | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number of Shares that May Yet be Purchased Under the Plans or Programs | |||||||
January 1, 2017 through January 31, 2017 | — | $ | — | N/A | N/A | ||||||
February 1, 2017 through February 28, 2017 | — | — | N/A | N/A | |||||||
March 1, 2017 through March 31, 2017 | 42,534 | 13.84 | N/A | N/A | |||||||
Total | 42,534 | $ | 13.84 |
WHITESTONE REIT | ||||
Date: | May 5, 2017 | /s/ James C. Mastandrea | ||
James C. Mastandrea | ||||
Chief Executive Officer | ||||
(Principal Executive Officer) |
Date: | May 5, 2017 | /s/ David K. Holeman | ||
David K. Holeman | ||||
Chief Financial Officer | ||||
(Principal Financial and Principal Accounting Officer) |
EXHIBIT INDEX |
Exhibit No. | Description |
3.1.1 | Articles of Amendment and Restatement of Declaration of Trust (previously filed as and incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K, filed on July 31, 2008) |
3.1.2 | Articles Supplementary (previously filed as and incorporated by reference to Exhibit 3(i).1 to the Registrant's Current Report on Form 8-K, filed on December 6, 2006) |
3.1.3 | Articles of Amendment (previously filed as and incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K, filed on August 24, 2010) |
3.1.4 | Articles of Amendment (previously filed as and incorporated by reference to Exhibit 3.2 to the Registrant's Current Report on Form 8-K, filed on August 24, 2010) |
3.1.5 | Articles Supplementary (previously filed as and incorporated by reference to Exhibit 3.3 to the Registrant's Current Report on Form 8-K, filed on August 24, 2010) |
3.1.6 | Articles of Amendment (previously filed as and incorporated by reference to Exhibit 3.1.1 to the Registrant's Current Report on Form 8-K, filed on June 27, 2012) |
3.1.7 | Articles of Amendment (previously filed as and incorporated by reference to Exhibit 3.1.2 to Registrant's Current Report on Form 8-K, filed on June 27, 2012) |
3.2 | Amended and Restated Bylaws (previously filed as and incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K, filed on October 9, 2008) |
12.1* | Statement of Calculation of Consolidated Ratio of Earnings to Fixed Charges. |
31.1* | Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
31.2* | Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
32.1** | Certificate of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
32.2** | Certificate of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
101.INS*** | XBRL Instance Document |
101.SCH*** | XBRL Taxonomy Extension Schema Document |
101.CAL*** | XBRL Taxonomy Extension Calculation Linkbase Document |
101.LAB*** | XBRL Taxonomy Extension Label Linkbase Document |
101.PRE*** | XBRL Taxonomy Extension Presentation Linkbase Document |
101.DEF*** | XBRL Taxonomy Extension Definition Linkbase Document |
Three Months | |||||||||||||||||||
Ended March 31, | Year Ended December 31, | ||||||||||||||||||
2017 | 2016 | 2015 | 2014 | 2013 | 2012 | ||||||||||||||
Earnings | |||||||||||||||||||
Income (loss) from continuing operations | $ | 1,557 | $ | 8,128 | $ | 6,854 | $ | 5,349 | $ | 3,621 | $ | (165 | ) | ||||||
Plus: Taxes | 81 | 289 | 372 | 282 | 293 | 275 | |||||||||||||
Plus: Fixed charges | 5,297 | 20,189 | 15,122 | 10,672 | 10,089 | 9,084 | |||||||||||||
Total earnings | $ | 6,935 | $ | 28,606 | $ | 22,348 | $ | 16,303 | $ | 14,003 | $ | 9,194 | |||||||
Fixed charges | |||||||||||||||||||
Interest expense | $ | 4,915 | $ | 18,311 | $ | 13,804 | $ | 9,680 | $ | 8,929 | $ | 7,482 | |||||||
Plus: Capitalized Interest | 72 | 324 | 106 | 93 | 114 | 176 | |||||||||||||
Plus: Amortization of deferred financing costs | 310 | 1,554 | 1,212 | 899 | 1,046 | 1,426 | |||||||||||||
Total fixed charges | $ | 5,297 | $ | 20,189 | $ | 15,122 | $ | 10,672 | $ | 10,089 | $ | 9,084 | |||||||
Ratio of earnings to fixed charges | 1.31 | 1.42 | 1.48 | 1.53 | 1.39 | 1.01 |
1. | I have reviewed this quarterly report on Form 10-Q, for the period ended March 31, 2017, of Whitestone REIT; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
1. | I have reviewed this quarterly report on Form 10-Q, for the period ended March 31, 2017, of Whitestone REIT; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ James C. Mastandrea |
James C. Mastandrea |
Chairman and Chief Executive Officer |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ David K. Holeman |
David K. Holeman |
Chief Financial Officer |
Document and Entity Information - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
May 03, 2017 |
|
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Whitestone REIT | |
Entity Central Index Key | 0001175535 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 38,056,049 |
Consolidated Balance Sheets (Parenthetical) - $ / shares |
Mar. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred shares, par value per share (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred shares, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred shares, shares issued (in shares) | 0 | 0 |
Preferred shares, shares outstanding (in shares) | 0 | 0 |
Common shares, par value per share (in dollars per share) | $ 0.001 | $ 0.001 |
Common shares, authorized (in shares) | 400,000,000 | 400,000,000 |
Common shares, issued (in shares) | 29,871,458 | 29,468,563 |
Common shares, outstanding (in shares) | 29,871,458 | 29,468,563 |
Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Property revenues | ||
Rental revenues | $ 21,296 | $ 19,422 |
Other revenues | 6,971 | 6,013 |
Total property revenues | 28,267 | 25,435 |
Property expenses | ||
Property operation and maintenance | 5,494 | 4,794 |
Real estate taxes | 3,920 | 3,354 |
Total property expenses | 9,414 | 8,148 |
Other expenses (income) | ||
General and administrative | 6,169 | 4,836 |
Depreciation and amortization | 6,008 | 5,392 |
Interest expense | 5,153 | 4,804 |
Interest, dividend and other investment income | (138) | (97) |
Total other expense | 17,192 | 14,935 |
Income before gain (loss) on sale or disposal of properties or assets and income taxes | 1,661 | 2,352 |
Provision for income taxes | (81) | (156) |
Gain on sale of properties | 0 | 2,890 |
Gain (loss) on sale or disposal of assets | (23) | 2 |
Net income | 1,557 | 5,088 |
Redeemable operating partnership units | 53 | 91 |
Non-controlling interests in Consolidated Partnership | 64 | 0 |
Less: Net income attributable to noncontrolling interests | 117 | 91 |
Net income attributable to Whitestone REIT | $ 1,440 | $ 4,997 |
Basic Earnings Per Share: | ||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares (in dollars per share) | $ 0.05 | $ 0.18 |
Diluted Earnings Per Share: | ||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares (in dollars per share) | $ 0.04 | $ 0.18 |
Weighted average number of common shares outstanding: | ||
Basic (in shares) | 29,416 | 26,604 |
Diluted (in shares) | 30,409 | 27,489 |
Distributions declared per common share / OP unit (in dollars per share) | $ 0.285 | $ 0.285 |
Consolidated Statements of Comprehensive Income (Loss) | ||
Net income | $ 1,557 | $ 5,088 |
Other comprehensive gain (loss) | ||
Unrealized gain (loss) on cash flow hedging activities | 732 | (6,041) |
Unrealized loss on available-for-sale marketable securities | 0 | (5) |
Comprehensive income (loss) | 2,289 | (958) |
Less: Net income attributable to noncontrolling interests | 117 | 91 |
Less: Comprehensive income (loss) attributable to noncontrolling interests | 26 | (108) |
Comprehensive income (loss) attributable to Whitestone REIT | $ 2,146 | $ (941) |
Consolidated Statement of Changes in Equity - 3 months ended Mar. 31, 2017 - USD ($) $ in Thousands |
Total |
Common Shares [Member] |
Additional Paid-In Capital [Member] |
Accumulated Deficit [Member] |
Accumulated Other Comprehensive Income (Loss) [Member] |
Total Shareholders' Equity [Member] |
Noncontrolling Interests [Member] |
General Partners' Interest in Consolidated Partnership [Member]
Noncontrolling Interests [Member]
|
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---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Beginning Balance, at Dec. 31, 2016 | $ 267,643 | [1] | $ 29 | $ 396,494 | $ (141,695) | $ 859 | $ 255,687 | $ 11,941 | $ 15 | |||||
Beginning Balance (in shares), at Dec. 31, 2016 | 29,468,563 | 29,468,000 | ||||||||||||
Beginning Balance (in units), at Dec. 31, 2016 | 1,103,000 | |||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Exchange of noncontrolling interest OP units for common shares (in shares) | 7,000 | 7,000 | ||||||||||||
Exchange of noncontrolling interest OP units for common shares | $ 0 | 80 | 80 | $ (80) | ||||||||||
Issuance of shares under dividend reinvestment plan (in shares) | 3,000 | |||||||||||||
Issuance of common shares, net of offering costs | 5,334 | $ 1 | 5,333 | 5,334 | ||||||||||
Issuance of common shares, net of offering costs (in shares) | 391,000 | |||||||||||||
Issuance of shares under dividend reinvestment plan | 33 | 33 | 33 | |||||||||||
Repurchase of common shares (in shares) | [2] | (43,000) | ||||||||||||
Repurchase of common shares | [2] | (591) | (591) | (591) | ||||||||||
Share-based compensation (in shares) | 45,000 | |||||||||||||
Share-based compensation | 2,447 | 2,447 | 2,447 | |||||||||||
Distributions | (8,926) | (8,573) | (8,573) | (312) | (41) | |||||||||
Unrealized gain on change in value of cash flow hedge | 732 | 706 | 706 | 26 | ||||||||||
Reallocation of ownership percentage between parent and subsidiary | 0 | (13) | 0 | (13) | 13 | |||||||||
Net income | 1,557 | 1,440 | 1,440 | 53 | 64 | |||||||||
Ending Balance, at Mar. 31, 2017 | $ 268,229 | [1] | $ 30 | $ 403,783 | $ (148,828) | $ 1,565 | $ 256,550 | $ 11,641 | $ 38 | |||||
Ending Balance (in shares), at Mar. 31, 2017 | 29,871,458 | 29,871,000 | ||||||||||||
Ending Balance (in units), at Mar. 31, 2017 | 1,096,000 | |||||||||||||
|
Consolidated Statements of Cash Flows - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|||||
Cash flows from operating activities: | ||||||||
Net income | $ 1,557 | $ 5,088 | ||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 6,008 | 5,392 | ||||||
Amortization of deferred loan costs | 310 | 315 | ||||||
Amortization of notes payable discount | 149 | 72 | ||||||
Loss (gain) on sale or disposal of assets and properties | 23 | (2,892) | ||||||
Bad debt expense | 609 | 372 | ||||||
Share-based compensation | 2,447 | 2,025 | ||||||
Changes in operating assets and liabilities: | ||||||||
Escrows and acquisition deposits | 880 | 1,853 | ||||||
Accrued rent and accounts receivable | (1,338) | (1,377) | ||||||
Unamortized lease commissions | (383) | (382) | ||||||
Prepaid expenses and other assets | 444 | 191 | ||||||
Accounts payable and accrued expenses | (9,977) | (5,161) | ||||||
Tenants' security deposits | 154 | 180 | ||||||
Net cash provided by operating activities | 883 | 5,676 | ||||||
Cash flows from investing activities: | ||||||||
Additions to real estate | (4,556) | (4,364) | ||||||
Proceeds from sales of properties | 0 | 1,097 | ||||||
Net cash used in investing activities | (4,556) | (3,267) | ||||||
Cash flows from financing activities: | ||||||||
Distributions paid to common shareholders | (8,453) | (7,711) | ||||||
Distributions paid to OP unit holders | (313) | (139) | ||||||
Proceeds from issuance of common shares, net of offering costs | 5,334 | 0 | ||||||
Proceeds from revolving credit facility | 11,000 | 7,000 | ||||||
Repayments of notes payable | (869) | (739) | ||||||
Change in restricted cash | (100) | (89) | ||||||
Repurchase of common shares | (591) | (871) | ||||||
Net cash provided by (used in) financing activities | 6,008 | (2,549) | ||||||
Net increase (decrease) in cash and cash equivalents | 2,335 | (140) | ||||||
Cash and cash equivalents at beginning of period | 4,168 | [1] | 2,587 | $ 2,587 | ||||
Cash and cash equivalents at end of period | 6,503 | [1] | 2,447 | 4,168 | [1] | $ 2,587 | ||
Supplemental disclosure of cash flow information: | ||||||||
Cash paid for interest | 4,936 | 4,602 | ||||||
Non cash investing and financing activities: | ||||||||
Disposal of fully depreciated real estate | 70 | 187 | ||||||
Financed insurance premiums | 1,115 | 1,060 | ||||||
Value of shares issued under dividend reinvestment plan | 33 | 27 | ||||||
Value of common shares exchanged for OP units | 80 | 98 | ||||||
Change in fair value of available-for-sale securities | 0 | (5) | ||||||
Change in fair value of cash flow hedge | 732 | (6,041) | ||||||
Proceeds from 1031 exchange transaction | 0 | 2,860 | ||||||
Reallocation of ownership percentage between parent and subsidiary | $ 13 | $ 0 | ||||||
Accrued distribution payable to General Partners' Interest in Consolidated Partnership | $ 41 | $ 0 | ||||||
|
Interim Financial Statements |
3 Months Ended |
---|---|
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Interim Financial Statements | INTERIM FINANCIAL STATEMENTS The consolidated financial statements included in this report are unaudited; however, amounts presented in the consolidated balance sheet as of December 31, 2016 are derived from our audited consolidated financial statements as of that date. The unaudited financial statements as of and for the period ended March 31, 2017 have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information on a basis consistent with the annual audited consolidated financial statements and with the instructions to Form 10-Q. The consolidated financial statements presented herein reflect all adjustments which, in the opinion of management, are necessary for a fair presentation of the financial position of Whitestone and our subsidiaries as of March 31, 2017, and the results of operations for the three month periods ended March 31, 2017 and 2016, the consolidated statements of changes in equity for the three month period ended March 31, 2017 and cash flows for the three month periods ended March 31, 2017 and 2016. All of these adjustments are of a normal recurring nature. The results of operations for the interim periods are not necessarily indicative of the results expected for a full year. The statements should be read in conjunction with the audited consolidated financial statements and the notes thereto which are included in our Annual Report on Form 10-K for the year ended December 31, 2016. Business. Whitestone was formed as a real estate investment trust (“REIT”) pursuant to the Texas Real Estate Investment Trust Act on August 20, 1998. In July 2004, we changed our state of organization from Texas to Maryland pursuant to a merger where we merged directly with and into a Maryland REIT formed for the sole purpose of the reorganization and the conversion of each of the outstanding common shares of beneficial interest of the Texas entity into 1.42857 common shares of beneficial interest of the Maryland entity. We serve as the general partner of Whitestone REIT Operating Partnership, L.P. (the “Operating Partnership”), which was formed on December 31, 1998 as a Delaware limited partnership. We currently conduct substantially all of our operations and activities through the Operating Partnership. As the general partner of the Operating Partnership, we have the exclusive power to manage and conduct the business of the Operating Partnership, subject to certain customary exceptions. As of March 31, 2017 and December 31, 2016, Whitestone owned or held a majority interest in 69 commercial properties in and around Austin, Chicago, Dallas-Fort Worth, Houston, Phoenix and San Antonio. |
Summary of Significant Accounting Policies |
3 Months Ended |
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Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Consolidation. We are the sole general partner of the Operating Partnership and possess full legal control and authority over the operations of the Operating Partnership. As of March 31, 2017 and December 31, 2016, we owned a majority of the partnership interests in the Operating Partnership. Consequently, the accompanying consolidated financial statements include the accounts of the Operating Partnership. We also consolidate a variable interest entity (“VIE”) when we are determined to be the primary beneficiary. Determination of the primary beneficiary is based on whether an entity has (1) the power to direct activities that most significantly impact the economic performance of the VIE and (2) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. Our determination of the primary beneficiary considers all relationships between us and the VIE, including management and other contractual agreements. See Note 6 for additional disclosure on our VIE. Noncontrolling interest in the accompanying consolidated financial statements represents the share of equity and earnings of the Operating Partnership allocable to holders of partnership interests other than us. Net income or loss is allocated to noncontrolling interests based on the weighted-average percentage ownership of the Operating Partnership during the period. Issuance of additional common shares of beneficial interest in Whitestone (the “common shares”) and units of limited partnership interest in the Operating Partnership that are convertible into cash or, at our option, common shares on a one-for-one basis (the “OP units”) changes the percentage of ownership interests of both the noncontrolling interests and Whitestone. Basis of Accounting. Our financial records are maintained on the accrual basis of accounting whereby revenues are recognized when earned and expenses are recorded when incurred. Use of Estimates. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates that we use include the estimated fair values of properties acquired, the estimated useful lives for depreciable and amortizable assets and costs, the estimated allowance for doubtful accounts, the estimated fair value of interest rate swaps and the estimates supporting our impairment analysis for the carrying values of our real estate assets. Actual results could differ from those estimates. Reclassifications. We have reclassified certain prior period amounts in the accompanying consolidated financial statements in order to be consistent with the current period presentation. These reclassifications had no effect on net income, total assets, total liabilities or equity. Restricted Cash. We classify all cash pledged as collateral to secure certain obligations and all cash whose use is limited as restricted cash. During 2015, pursuant to the terms of our $15.1 million 4.99% Note, due January 6, 2024 (See Note 7), which is collateralized by our Anthem Marketplace property, we were required by the lenders thereunder to establish a cash management account controlled by the lenders to collect all amounts generated by our Anthem Marketplace property in order to collateralize such promissory note. As a result, these amounts are reported in the consolidated statements of cash flows under cash flows from financing activities as change in restricted cash. Marketable Securities. We classify our existing marketable equity securities as available-for-sale in accordance with the Financial Accounting Standards Board's (“FASB”) Investments-Debt and Equity Securities guidance. These securities are carried at fair value with unrealized gains and losses reported in equity as a component of accumulated other comprehensive income or loss. The fair value of the marketable securities is determined using Level 1 inputs under FASB Accounting Standards Codification (“ASC”) 820, “Fair Value Measurements and Disclosures.” Level 1 inputs represent quoted prices available in an active market for identical investments as of the reporting date. Gains and losses on securities sold are based on the specific identification method, and are reported as a component of interest, dividend and other investment income. Derivative Instruments and Hedging Activities. We utilize derivative financial instruments, principally interest rate swaps, to manage our exposure to fluctuations in interest rates. We have established policies and procedures for risk assessment, and the approval, reporting and monitoring of derivative financial instruments. We recognize our interest rate swaps as cash flow hedges with the effective portion of the changes in fair value recorded in comprehensive income (loss) and subsequently reclassified into earnings in the period that the hedged transaction affects earnings. Any ineffective portion of a cash flow hedges' change in fair value is recorded immediately into earnings. Our cash flow hedges are determined using Level 2 inputs under ASC 820. Level 2 inputs represent quoted prices in active markets for similar assets or liabilities; quoted prices in markets that are not active; and model-derived valuations whose inputs are observable. As of March 31, 2017, we consider our cash flow hedges to be highly effective. Development Properties. Land, buildings and improvements are recorded at cost. Expenditures related to the development of real estate are carried at cost which includes capitalized carrying charges and development costs. Carrying charges (interest, real estate taxes, loan fees, and direct and indirect development costs related to buildings under construction), are capitalized as part of construction in progress. The capitalization of such costs ceases when the property, or any completed portion, becomes available for occupancy. For the three months ended March 31, 2017, approximately $72,000 and $29,000 in interest expense and real estate taxes, respectively, were capitalized, and for the three months ended March 31, 2016, approximately $27,000 and $16,000 in interest expense and real estate taxes, respectively, were capitalized. Real Estate Held for Sale and Discontinued Operations. We consider a commercial property to be held for sale when it meets all of the criteria established under ASC 205, “Presentation of Financial Statements.” For commercial properties classified as held for sale, assets and liabilities are presented separately for all periods presented. In accordance with ASC 205, a discontinued operation may include a component of an entity or a group of components of an entity. A disposal of a component of an entity or a group of components of an entity is reported in discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results when the component of an entity or group of components of an entity is classified as held for sale, disposed of by sale or disposed of other than by sale, respectively. In addition, ASC 205 requires us to provide additional disclosures about both discontinued operations and the disposal of an individually significant component of an entity that does not meet the criteria for a discontinued operation. Share-Based Compensation. From time to time, we award nonvested restricted common share awards or restricted common share unit awards, which may be converted into common shares, to executive officers and employees under our 2008 Long-Term Equity Incentive Ownership Plan (the “2008 Plan”). The vast majority of the awarded shares and units vest when certain performance conditions are met. We recognize compensation expense when achievement of the performance conditions is probable based on management's most recent estimates using the fair value of the shares as of the grant date. We recognized $2,451,000 and $2,025,000 in share-based compensation for the three months ended March 31, 2017 and 2016, respectively. Noncontrolling Interests. Noncontrolling interests is the portion of equity in a subsidiary not attributable to a parent. The ownership interests not held by the parent are considered noncontrolling interests. Accordingly, we have reported noncontrolling interests in equity on the consolidated balance sheets but separate from Whitestone's equity. On the consolidated statements of operations, subsidiaries are reported at the consolidated amount, including both the amount attributable to Whitestone and noncontrolling interests. The consolidated statement of changes in equity is included for quarterly financial statements, including beginning balances, activity for the period and ending balances for shareholders' equity, noncontrolling interests and total equity. See our Annual Report on Form 10-K for the year ended December 31, 2016 for further discussion on significant accounting policies. Recent Accounting Pronouncements. In February 2016, the FASB issued guidance requiring lessees to recognize a lease liability and a right-of-use asset for all leases. Lessor accounting will remain largely unchanged with the exception of changes related to costs which qualify as initial direct costs. The guidance will also require new qualitative and quantitative disclosures to help financial statement users better understand the timing, amount and uncertainty of cash flows arising from leases. This guidance will be effective for reporting periods beginning on or after December 15, 2018, with early adoption permitted. We are currently evaluating the impact of this guidance and its impact on our consolidated financial statements. In March 2016, the FASB issued guidance simplifying the accounting for share-based payment transactions, including the income tax consequences, balance sheet classification of awards and the classification on the statement of cash flows. We have adopted this guidance as of January 1, 2017. The main provision regarding excess tax benefits did not have an impact on our consolidated financial statements due to our status as a REIT for taxation purposes. We have elected to continue estimating the number of shares expected to vest in order to determine compensation cost, and we will continue to classify cash paid by us for employee taxes when common shares were repurchased to cover minimum statutory requirements as financing activity. In November 2016, the FASB issued guidance requiring that the statement of cash flows explain the change during the period in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This guidance will become effective for the reporting periods beginning on or after December 15, 2017, and interim periods within those fiscal years. We are currently evaluating the impact of this guidance and its impact on our consolidated financial statements. In January 2017, the FASB issued guidance clarifying the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This guidance will become effective for the reporting periods beginning on or after December 15, 2017, and interim periods within those fiscal years. We are currently evaluating the impact of this guidance and its impact on our consolidated financial statements. In February 2017, the FASB issued guidance clarifying the scope of asset derecognition guidance, adds guidance for partial sales of nonfinancial assets and clarifies recognizing gains and losses from the transfer of nonfinancial assets in contracts with noncustomers. This guidance will become effective for the reporting periods beginning on or after December 15, 2017, and interim periods within those fiscal years. We are currently evaluating the impact of this guidance and its impact on our consolidated financial statements. |
Marketable Securities |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Marketable Securities | MARKETABLE SECURITIES All of our marketable securities were classified as available-for-sale securities as of March 31, 2017 and December 31, 2016. Available-for-sale securities consisted of the following (in thousands):
During the three months ended March 31, 2017 and 2016, no available-for-sale securities were sold. For purposes of determining gross realized gains and losses, the cost of securities sold is based on specific identification. A net unrealized holding loss on available-for-sale securities in the amount of $137,000 and $224,000 for the three months ended March 31, 2017 and 2016, respectively, has been included in accumulated other comprehensive income (loss). |
Accrued Rents and Accounts Receivable, Net |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Rent and Accounts Receivable, Net | ACCRUED RENTS AND ACCOUNTS RECEIVABLE, NET Accrued rents and accounts receivable, net consists of amounts accrued, billed and due from tenants, allowance for doubtful accounts and other receivables as follows (in thousands):
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Unamortized Leasing Commissions, Legal Fees and Loan Costs |
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unamortized Leasing Commissions, Legal Fees and Loan Costs | UNAMORTIZED LEASE COMMISSIONS, LEGAL FEES AND LOAN COSTS Costs which have been deferred consist of the following (in thousands):
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Variable Interest Entities |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
VARIABLE INTEREST ENTITIES | VARIABLE INTEREST ENTITIES On December 8, 2016, we, through our Operating Partnership, entered into a Contribution Agreement (the “Contribution Agreement”) with Pillarstone Capital REIT Operating Partnership LP (“Pillarstone,” “Pillarstone OP” or the “Consolidated Partnership”) and Pillarstone Capital REIT (“Pillarstone REIT”) pursuant to which we contributed all of the equity interests in four of our wholly-owned subsidiaries: Whitestone CP Woodland Ph. 2, LLC, a Delaware limited liability company (“CP Woodland”); Whitestone Industrial-Office, LLC, a Texas limited liability company (“Industrial-Office”); Whitestone Offices, LLC, a Texas limited liability company (“Whitestone Offices”); and Whitestone Uptown Tower, LLC, a Delaware limited liability company (“Uptown Tower,” and together with CP Woodland, Industrial-Office and Whitestone Offices, the “Entities”) that own 14 non-core properties that do not fit our Community Centered Property™ strategy (the “Pillarstone Properties”), to Pillarstone OP for aggregate consideration of approximately $84 million, consisting of (1) approximately 18.1 million Class A units representing limited partnership interests in Pillarstone OP (“Pillarstone OP Units”), issued at a price of $1.331 per Pillarstone OP Unit; and (2) the assumption of approximately $65.9 million of liabilities, consisting of (a) approximately $15.5 million of our liability under the 2014 Facility (as defined in Note 9); (b) an approximately $16.3 million promissory note of Uptown Tower under the Loan Agreement, dated as of September 26, 2013, between Uptown Tower, as borrower, and U.S. Bank, National Association, as successor to Morgan Stanley Mortgage Capital Holdings LLC, as lender; and (c) an approximately $34.1 million promissory note (the “Industrial-Office Promissory Note”) of Industrial-Office issued under the Loan Agreement, dated as of November 26, 2013 (the “Industrial-Office Loan Agreement”), between Industrial-Office, as borrower, and Jackson National Life Insurance Company, as lender (collectively, the “Contribution”). In connection with the Contribution, on December 8, 2016, the Operating Partnership entered into an OP Unit Purchase Agreement (the “OP Unit Purchase Agreement”) with Pillarstone REIT and Pillarstone OP pursuant to which the Operating Partnership agreed to purchase up to an aggregate of $3.0 million of Pillarstone OP Units at a price of $1.331 per Pillarstone OP Unit over the two-year term of the OP Unit Purchase Agreement on the terms set forth therein. The OP Unit Purchase Agreement contains customary closing conditions and the parties have made certain customary representations, warranties and indemnifications to each other in the OP Unit Purchase Agreement. In addition, pursuant to the OP Unit Purchase Agreement, in the event of a Change of Control (as defined therein) of the Company, Pillarstone OP shall have the right, but not the obligation, to repurchase the Pillarstone OP Units issued thereunder from the Operating Partnership at their initial issue price of $1.331 per Pillarstone OP Unit. In connection with the Contribution, (1) with respect to each Pillarstone Property (other than Uptown Tower), Whitestone TRS, Inc., a subsidiary of the Company (“Whitestone TRS”), entered into a Management Agreement with the Entity that owns such Pillarstone Property and (2) with respect to Uptown Tower, Whitestone TRS entered into a Management Agreement with Pillarstone OP (collectively, the “Management Agreements”). Pursuant to the Management Agreements with respect to each Pillarstone Property (other than Uptown Tower), Whitestone TRS agreed to provide certain property management, leasing and day-to-day advisory and administrative services to such Pillarstone Property in exchange for (x) a monthly property management fee equal to 5.0% of the monthly revenues of such Pillarstone Property and (y) a monthly asset management fee equal to 0.125% of GAV (as defined in each Management Agreement as, generally, the purchase price of the respective Pillarstone Property based upon the purchase price allocations determined pursuant to the Contribution Agreement, excluding all indebtedness, liabilities or claims of any nature) of such Pillarstone Property. Pursuant to the Management Agreement with respect to Uptown Tower, Whitestone TRS agreed to provide certain property management, leasing and day-to-day advisory and administrative services to Pillarstone OP in exchange for (x) a monthly property management fee equal to 3.0% of the monthly revenues of Uptown Tower and (y) a monthly asset management fee equal to 0.125% of GAV of Uptown Tower. As of March 31, 2017, we owned approximately 81.4% of the total outstanding units of Pillarstone OP. Additionally, certain of our officers and trustees serve as officers and trustees of Pillarstone REIT. We have determined that we are the primary beneficiary of Pillarstone OP, through our power to direct the activities of Pillarstone OP, additional working capital required by Pillarstone OP under the OP Unit Purchase Agreement and our obligation to absorb losses and receive benefits based on our ownership percentage. Accordingly, we account for Pillarstone OP as a VIE and fully consolidate in our consolidated financial statements. The carrying amounts and classification of certain assets and liabilities for Pillarstone OP in our consolidated balance sheets as of March 31, 2017 and December 31, 2016 consists of the following (in thousands):
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Debt |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | DEBT Certain subsidiaries of Whitestone are the borrowers under various financing arrangements. These subsidiaries are separate legal entities, and their respective assets and credit are not available to satisfy the debt of Whitestone or any of its other subsidiaries. Debt consisted of the following as of the dates indicated (in thousands):
On November 7, 2014, we, through our Operating Partnership, entered into an unsecured revolving credit facility (the “2014 Facility”) with the lenders party thereto, with BMO Capital Markets, Wells Fargo Securities, LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated, and U.S. Bank, National Association, as co-lead arrangers and joint book runners, and Bank of Montreal, as administrative agent (the “Agent”). The 2014 Facility amended and restated our previous unsecured revolving credit facility. On October 30, 2015, we, through our Operating Partnership, entered into the First Amendment to the 2014 Facility (the “First Amendment”) with the guarantors party thereto, the lenders party thereto and the Agent. We refer to the 2014 Facility, as amended by the First Amendment, as the “Facility.” Pursuant to the First Amendment, the Company made the following amendments to the 2014 Facility:
Borrowings under the Facility accrue interest (at the Operating Partnership's option) at a Base Rate or an Adjusted LIBOR plus an applicable margin based upon our then existing leverage. The applicable margin for Adjusted LIBOR borrowings ranges from 1.40% to 1.95% for the Revolver and 1.35% to 2.25% for the Term Loans. Base Rate means the higher of: (a) the Agent's prime commercial rate, (b) the sum of (i) the average rate quoted by the Agent by two or more federal funds brokers selected by the Agent for sale to the Agent at face value of federal funds in the secondary market in an amount equal or comparable to the principal amount for which such rate is being determined, plus (ii) 1/2 of 1.00%, and (c) the LIBOR rate for such day plus 1.00%. Adjusted LIBOR means LIBOR divided by one minus the Eurodollar Reserve Percentage. The Eurodollar Reserve Percentage means the maximum reserve percentage at which reserves are imposed by the Board of Governors of the Federal Reserve System on eurocurrency liabilities. We serve as the guarantor for funds borrowed by the Operating Partnership under the Facility. The Facility contains customary terms and conditions, including, without limitation, affirmative and negative covenants such as information reporting requirements, maximum secured indebtedness to total asset value, minimum EBITDA (earnings before interest, taxes, depreciation, amortization or extraordinary items) to fixed charges, and maintenance of a minimum net worth. The Facility also contains customary events of default with customary notice and cure, including, without limitation, nonpayment, breach of covenant, misrepresentation of representations and warranties in a material respect, cross-default to other major indebtedness, change of control, bankruptcy and loss of REIT tax status. The Facility includes an accordion feature that will allow the Operating Partnership to increase the borrowing capacity to $700 million, upon the satisfaction of certain conditions. As of March 31, 2017, $397.6 million was drawn on the Facility, and our remaining borrowing capacity was $102.4 million. Proceeds from the Facility were used for general corporate purposes, including property acquisitions, debt repayment, capital expenditures, the expansion, redevelopment and retenanting of properties in our portfolio and working capital. We intend to use the additional proceeds from the Facility for general corporate purposes, including property acquisitions, debt repayment, capital expenditure, the expansion, redevelopment and re-tenanting of properties in our portfolio and working capital. On December 8, 2016, in connection with the Contribution, the Operating Partnership entered into the Second Amendment to the Facility and Reaffirmation of Guaranties (the “Second Amendment”) with Pillarstone, the Company and the other Guarantors party thereto, the lenders party thereto and the Agent. Pursuant to the Second Amendment, following the Contribution, Whitestone Offices, LLC and Whitestone CP Woodland Ph. 2, LLC were permitted to remain Material Subsidiaries (as defined in the Facility) and Guarantors under the Facility and their respective Pillarstone Properties were each permitted to remain an Eligible Property (as defined in the Facility) and be included in the Borrowing Base (as defined in the Facility) under the Facility. In addition, on December 8, 2016, Pillarstone entered into the Limited Guarantee (the “Limited Guarantee”) with the Agent, pursuant to which Pillarstone agreed to be joined as a party to the Facility to provide a limited guarantee up to the amount of availability generated by the Pillarstone Properties owned by Whitestone Offices, LLC and Whitestone CP Woodland Ph. 2, LLC. As of March 31, 2017, Pillarstone accounted for approximately $15.5 million of the total amount drawn on the Facility. As of March 31, 2017, our $158.4 million in secured debt was collateralized by 19 properties with a carrying value of $189.0 million. Our loans contain restrictions that would require the payment of prepayment penalties for the acceleration of outstanding debt and are secured by deeds of trust on certain of our properties and by assignment of the rents and leases associated with those properties. As of March 31, 2017, we were in compliance with all loan covenants. Scheduled maturities of our outstanding debt as of March 31, 2017 were as follows (in thousands):
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Derivatives and Hedging Activities |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivatives and Hedging Activities | DERIVATIVES AND HEDGING ACTIVITIES The fair value of our interest rate swaps is as follows (in thousands):
On November 19, 2015, we, through our Operating Partnership, entered into an interest rate swap with Bank of Montreal that fixed the LIBOR portion of Term Loan 3 under the Facility at 1.725%. In the fourth quarter of 2015, pursuant to the terms of the agreement governing the interest rate swap, Bank of Montreal assigned $35.0 million of the swap to U.S. Bank, National Association, and $15.0 million of the swap to SunTrust Bank. See Note 7 for additional information regarding the Facility. The swap began on November 30, 2015 and will mature on October 28, 2022. We have designated the interest rate swap as a cash flow hedge with the effective portion of the changes in fair value to be recorded in comprehensive income (loss) and subsequently reclassified into earnings in the period that the hedged transaction affects earnings. The ineffective portion of the change in fair value, if any, will be recognized directly in earnings. On November 19, 2015, we, through our Operating Partnership, entered into an interest rate swap with Bank of Montreal that fixed the LIBOR portion of Term Loan 1 under the Facility at 1.75%. In the fourth quarter of 2015, pursuant to the terms of the agreement governing the interest rate swap, Bank of Montreal assigned $3.8 million of the swap to Regions Bank, $6.5 million of the swap to U.S. Bank, National Association, $14.0 million of the swap to Wells Fargo Bank, National Association, $14.0 million of the swap to Bank of America, N.A., and $5.0 million of the swap to SunTrust Bank. See Note 7 for additional information regarding the Facility. The swap began on February 3, 2017 and will mature on October 30, 2020. We have designated the interest rate swap as a cash flow hedge with the effective portion of the changes in fair value to be recorded in comprehensive income (loss) and subsequently reclassified into earnings in the period that the hedged transaction affects earnings. The ineffective portion of the change in fair value, if any, will be recognized directly in earnings. On November 19, 2015, we, through our Operating Partnership, entered into an interest rate swap with Bank of Montreal that fixed the LIBOR portion of Term Loan 2 under the Facility at 1.50%. In the fourth quarter of 2015, pursuant to the terms of the agreement governing the interest rate swap, Bank of Montreal assigned $3.8 million of the swap to Regions Bank, $6.5 million of the swap to U.S. Bank, National Association, $14.0 million of the swap to Wells Fargo Bank, National Association, $14.0 million of the swap to Bank of America, N.A., and $5.0 million of the swap to SunTrust Bank. See Note 7 for additional information regarding the Facility. The swap began on December 7, 2015 and will mature on January 29, 2021. We have designated the interest rate swap as a cash flow hedge with the effective portion of the changes in fair value to be recorded in comprehensive income (loss) and subsequently reclassified into earnings in the period that the hedged transaction affects earnings. The ineffective portion of the change in fair value, if any, will be recognized directly in earnings. A summary of our interest rate swap activity is as follows (in thousands):
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Earnings (Loss) Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | EARNINGS PER SHARE Basic earnings per share for our common shareholders is calculated by dividing income from continuing operations excluding amounts attributable to unvested restricted common shares and the net income attributable to noncontrolling interests by our weighted average common shares outstanding during the period. Diluted earnings per share is computed by dividing the net income attributable to common shareholders excluding amounts attributable to unvested restricted common shares and the net income attributable to noncontrolling interests by the weighted average number of common shares including any dilutive unvested restricted common shares. Certain of our performance-based restricted common shares are considered participating securities that require the use of the two-class method for the computation of basic and diluted earnings per share. During the three months ended March 31, 2017 and 2016, 1,099,827 and 491,023 OP units, respectively, were excluded from the calculation of diluted earnings per share because their effect would be anti-dilutive. For the three months ended March 31, 2017 and 2016, distributions of $95,000 and $155,000, respectively, were made to holders of certain restricted common shares, $4,000 and $0, respectively, of which were charged against earnings. See Note 12 for information related to restricted common shares under the 2008 Plan.
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Income Taxes |
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Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES With the exception of our taxable REIT subsidiaries, federal income taxes are generally not provided because we intend to and believe we qualify as a REIT under the provisions of the Internal Revenue Code (the “Code”) and because we have distributed and intend to continue to distribute all of our taxable income to our shareholders. As a REIT, we must distribute at least 90% of our REIT taxable income to our shareholders and meet certain income sources and investment restriction requirements. In addition, REITs are subject to a number of organizational and operational requirements. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income tax (including any applicable alternative minimum tax) on our taxable income at regular corporate tax rates. Income earned by our taxable REIT subsidiary, Whitestone Davenport TRS LLC (“Davenport TRS”), is subject to federal income tax. For the three months ended March 31, 2016, we recognized $45,000 in income tax expense related to Davenport TRS taxable year. Davenport TRS was dissolved in the fourth quarter of 2016. We are subject to the Texas Margin Tax, which is computed by applying the applicable tax rate (0.75% for us) to the profit margin, which generally will be determined for us as total revenue less a 30% standard deduction. Although the Texas Margin Tax is not an income tax, FASB ASC 740, “Income Taxes” applies to the Texas Margin Tax. For the three months ended March 31, 2017 and 2016, we recognized approximately $79,000 and $114,000 in margin tax provision, respectively. |
Equity |
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Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity | EQUITY Common Shares Under our declaration of trust, as amended, we have authority to issue up to 400,000,000 common shares of beneficial interest, $0.001 par value per share, and up to 50,000,000 preferred shares of beneficial interest, $0.001 par value per share. Equity Offerings On June 4, 2015, we entered into six amended and restated equity distribution agreements for an at-the-market equity distribution program (the “2015 equity distribution agreements”). Pursuant to the terms and conditions of the 2015 equity distribution agreements, we can issue and sell up to an aggregate of $50 million of our common shares. Actual sales will depend on a variety of factors to be determined by us from time to time, including (among others) market conditions, the trading price of our common shares, capital needs and our determinations of the appropriate sources of funding for us, and will be made in transactions that will be deemed to be “at-the-market” offerings as defined in Rule 415 under the Securities Act. We have no obligation to sell any of our common shares, and can at any time suspend offers under the 2015 equity distribution agreements or terminate the 2015 equity distribution agreements. During the three months ended March 31, 2017, we sold 390,726 common shares under the 2015 equity distribution agreements, with net proceeds to us of approximately $5.3 million. In connection with such sales, we paid compensation of approximately $0.1 million to the sales agents. We did not sell any common shares under the 2015 equity distribution agreements during the three months ended March 31, 2016. Operating Partnership Units Substantially all of our business is conducted through our Operating Partnership. We are the sole general partner of the Operating Partnership. As of March 31, 2017, we owned a 96.4% interest in the Operating Partnership. Limited partners in the Operating Partnership holding OP units have the right to redeem their OP units for cash or, at our option, common shares at a ratio of one OP unit for one common share. Distributions to OP unit holders are paid at the same rate per unit as distributions per share to holders of Whitestone common shares. As of March 31, 2017 and December 31, 2016, there were 30,845,917 and 30,450,377 OP units outstanding, respectively. We owned 29,750,636 and 29,347,741 OP units as of March 31, 2017 and December 31, 2016, respectively. The balance of the OP units is owned by third parties, including certain members of our board of trustees. Our weighted average share ownership in the Operating Partnership was approximately 96.4% and 98.2% for the three months ended March 31, 2017 and 2016, respectively. During the three months ended March 31, 2017 and 2016, 7,355 and 12,101 OP units, respectively, were redeemed for an equal number of common shares. Distributions The following table summarizes the cash distributions paid or payable to holders of common shares and to holders of noncontrolling OP units during each quarter during 2016 and the three months ended March 31, 2017 (in thousands, except per share/unit data):
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Incentive Share Plan |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Incentive Share Plan | INCENTIVE SHARE PLAN On July 29, 2008, our shareholders approved the 2008 Plan. On December 22, 2010, our board of trustees amended the 2008 Plan to allow for awards in or related to Class B common shares pursuant to the 2008 Plan. On June 27, 2012, our Class B common shares were redesignated as “common shares.” The 2008 Plan, as amended, provides that awards may be made with respect to common shares of Whitestone or OP units, which may be redeemed for cash or, at our option, common shares of Whitestone. The maximum aggregate number of common shares that may be issued under the 2008 Plan is increased upon each issuance of common shares by Whitestone so that at any time the maximum number of common shares that may be issued under the 2008 Plan shall equal 12.5% of the aggregate number of common shares of Whitestone and OP units issued and outstanding (other than common shares and/or OP units issued to or held by Whitestone). The Compensation Committee of our board of trustees administers the 2008 Plan, except with respect to awards to non-employee trustees, for which the 2008 Plan is administered by our board of trustees. The Compensation Committee is authorized to grant share options, including both incentive share options and non-qualified share options, as well as share appreciation rights, either with or without a related option. The Compensation Committee is also authorized to grant restricted common shares, restricted common share units, performance awards and other share-based awards. On April 2, 2014, the Compensation Committee approved the modification of the vesting provisions with respect to awards of an aggregate of 633,704 restricted common shares and restricted common share units for 51 of our employees. The modified time-based shares will vest annually in three equal installments. The modified performance-based restricted common shares and restricted common share units were modified to include performance-based vesting based on achievement of certain absolute financial goals, as well as one to two years of time-based vesting post achievement of financial goals. Continued employment is required through the applicable vesting date. Additionally, 2,049,116 restricted performance-based common share units were granted with the same vesting conditions as the modified performance-based grants described above. If the performance targets are not met prior to December 31, 2018, any unvested performance-based restricted common shares and restricted common share units will be forfeited. The Compensation Committee approved the grant of an aggregate of 320,000 and 143,000 time-based restricted common share units on June 30, 2016 and 2015, respectively, to James C. Mastandrea and David K. Holeman. A summary of the share-based incentive plan activity as of and for the three months ended March 31, 2017 is as follows:
A summary of our non-vested and vested shares activity for the three months ended March 31, 2017 and years ended December 31, 2016, 2015 and 2014 is presented below:
Total compensation recognized in earnings for share-based payments was $2,451,000 and $2,025,000 for the three months ended March 31, 2017 and 2016, respectively. Based on our current financial projections, we expect approximately 82% of the unvested awards to vest over the next 24 months. As of March 31, 2017, there was approximately $3.2 million in unrecognized compensation cost related to outstanding non-vested performance-based shares, which are expected to vest over a period of 24 months and approximately $5.4 million in unrecognized compensation cost related to outstanding non-vested time-based shares, which are expected to be recognized over a period of approximately 12 months beginning on April 1, 2017. We expect to record approximately $8.6 million in non-cash share-based compensation expense in 2017 and $2.5 million subsequent to 2017. The unrecognized share-based compensation cost is expected to vest over a weighted average period of 16 months. The dilutive impact of the performance-based shares will be included in the denominator of the earnings per share calculation beginning in the period that the performance conditions are expected to be met. |
Grants to Trustees |
3 Months Ended |
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Mar. 31, 2017 | |
Grants to Trustees [Abstract] | |
Grants To Trustees | GRANTS TO TRUSTEES On December 21, 2016, each of our four independent trustees and one trustee emeritus was granted 1,500 common shares, which vested immediately. The 7,500 common shares granted to our trustees had a grant date fair value of $14.07 per share. On December 21, 2016, two of our independent trustees elected to receive a total of 3,128 common shares with a grant date fair value of $14.07 in lieu of cash for board fees. The fair values of the shares granted were determined using quoted prices available on the date of grant. |
Segment Information |
3 Months Ended |
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Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION Historically, our management has not differentiated results of operations by property type or location and, therefore, does not present segment information. |
Real Estate |
3 Months Ended |
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Mar. 31, 2017 | |
Real Estate [Abstract] | |
Real Estate Disclosure | REAL ESTATE Property acquisitions. On September 30, 2016, we acquired La Mirada and Seville, properties that meet our Community Centered Property™ strategy, for 621,053 OP units and $60.7 million in cash and net prorations. The OP units are redeemable for cash or, at our option, Whitestone REIT common shares on a one-for-one basis, subject to certain restrictions. La Mirada, a 147,209 square foot property, was 90% leased at the time of purchase. Seville, a 90,042 square foot property, was 88% leased at the time of purchase. Both properties are located in Scottsdale, Arizona. Development properties. As of March 31, 2017, we had substantially completed construction at our Pinnacle of Scottsdale Phase II property. As of March 31, 2017, we had incurred approximately $4.5 million in construction costs, including approximately $0.5 million in previously capitalized interest and real estate taxes. The 27,063 square foot Community Centered Property was 44% leased as of March 31, 2017 and is located in Scottsdale, Arizona, and adjacent to Pinnacle of Scottsdale. On December 31, 2016, we had substantially completed construction at our Shops at Starwood Phase III property. As of March 31, 2017, we had incurred approximately $7.6 million in construction costs, including approximately $0.8 million in previously capitalized interest and real estate taxes. The 35,351 square foot Community Centered Property was 50% leased as of March 31, 2017 and is located in Frisco, Texas, a northern suburb of Dallas, Texas, and adjacent to Shops at Starwood. Property dispositions. On March 3, 2016, we completed the sale of Brookhill, located in Houston, Texas, for $3.1 million. This disposition was pursuant to our strategy of recycling capital by disposing of non-core properties, primarily properties that we owned at the time our current management team assumed the management of the Company, that do not fit our Community Centered Property™ strategy. We recorded a gain on sale of $1.9 million. The sale was structured as a like-kind exchange within the meaning of Section 1031 of the Code and sales proceeds were deposited into a Section 1031 exchange escrow account with a qualified intermediary and subsequently distributed for general corporate purposes. We have not included Brookhill in discontinued operations as it did not meet the definition of discontinued operations. On February 17, 2016, we completed the sale of approximately 0.5 acres of our 4.5 acre Pinnacle Phase II development parcel, located in Scottsdale, Arizona, for $1.1 million. We recorded a gain on sale of $1.0 million. |
Subsequent Events |
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Mar. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS Pending Acquisitions On April 19, 2017, we announced the pending acquisitions of two retail centers located at BLVD Place in Houston, Texas and Eldorado Plaza in McKinney, Texas, respectively, each of which is a property that meets our Community Centered Property™ strategy, for an aggregate purchase price of $204.6 million in cash. On May 3, 2017, we acquired Eldorado Plaza. Pursuant to the purchase agreement governing the acquisition of BLVD Place, we expect the closing of BLVD Place to occur in May 2017. The closing of BLVD Place is not subject to a financing condition. We funded the purchase price of Eldorado Plaza and related transaction expenses through a combination of net proceeds from the April Offering (as defined below) and borrowings under our Facility. We expect to fund the purchase price of the acquisition of BLVD Place and related transaction expenses through a combination of net proceeds from the April Offering (as defined below), and $80 million of asset level mortgage financing (the “BLVD Financing”). We are currently negotiating the terms of the BLVD Financing with potential lenders, however we have not yet entered into a binding commitment letter or definitive loan documents and there can be no assurance that we will obtain the BLVD Financing on the terms we anticipate or at all. The consummation of the BLVD Place acquisition is not contingent on obtaining the BLVD Financing and, in the event we do not obtain the BLVD Financing, we expect to fund the purchase price of the BLVD Place acquisition through a combination of net proceeds from the April Offering, as discussed below, and borrowings under our Facility. In addition, pursuant to the purchase agreements governing the acquisition of BLVD Place, the closing of BLVD Place is subject to the satisfaction or waiver of certain customary closing conditions. There can be no assurance that the closing of the acquisition of BLVD Place will occur in accordance with the anticipated timeline or at all. See “Risk Factors - There can be no assurance that the acquisition of BLVD Place will be consummated or that the BLVD Financing will be obtained in accordance with the anticipated timing or at all.” April Offering On April 25, 2017, we completed the sale of 8,018,500 common shares, including 1,018,500 common shares purchased by the underwriters upon exercise of their option to purchase additional common shares, at a purchase price of $12.48 per share (the “April Offering”). Total net proceeds from the April Offering, after deducting offering expenses, were approximately $99.9 million, which we contributed to the Operating Partnership in exchange for OP units. The Operating Partnership intends to use the net proceeds from the April Offering initially to repay a portion of outstanding indebtedness under the Facility, which amounts will then become available for future borrowings, including the funding of a portion of the purchase price of the acquisitions of Eldorado Plaza and BLVD Place or for general corporate purposes. Eldorado Plaza Acquisition On May 3, 2017, we acquired Eldorado Plaza, a property that meets our Community Centered Property™ strategy, for $46.6 million in cash and net prorations from borrowings under our Facility. Eldorado Plaza, a 221,577 square foot property, was 96% leased at the time of purchase and is located in McKinney, Texas, a suburb of Dallas, Texas. |
Summary of Significant Accounting Policies (Policies) |
3 Months Ended |
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Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Consolidation | Basis of Consolidation. We are the sole general partner of the Operating Partnership and possess full legal control and authority over the operations of the Operating Partnership. As of March 31, 2017 and December 31, 2016, we owned a majority of the partnership interests in the Operating Partnership. Consequently, the accompanying consolidated financial statements include the accounts of the Operating Partnership. We also consolidate a variable interest entity (“VIE”) when we are determined to be the primary beneficiary. Determination of the primary beneficiary is based on whether an entity has (1) the power to direct activities that most significantly impact the economic performance of the VIE and (2) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. Our determination of the primary beneficiary considers all relationships between us and the VIE, including management and other contractual agreements. See Note 6 for additional disclosure on our VIE. Noncontrolling interest in the accompanying consolidated financial statements represents the share of equity and earnings of the Operating Partnership allocable to holders of partnership interests other than us. Net income or loss is allocated to noncontrolling interests based on the weighted-average percentage ownership of the Operating Partnership during the period. Issuance of additional common shares of beneficial interest in Whitestone (the “common shares”) and units of limited partnership interest in the Operating Partnership that are convertible into cash or, at our option, common shares on a one-for-one basis (the “OP units”) changes the percentage of ownership interests of both the noncontrolling interests and Whitestone. |
Basis of Accounting | Basis of Accounting. Our financial records are maintained on the accrual basis of accounting whereby revenues are recognized when earned and expenses are recorded when incurred. |
Use of Estimates | Use of Estimates. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates that we use include the estimated fair values of properties acquired, the estimated useful lives for depreciable and amortizable assets and costs, the estimated allowance for doubtful accounts, the estimated fair value of interest rate swaps and the estimates supporting our impairment analysis for the carrying values of our real estate assets. Actual results could differ from those estimates. |
Reclassifications | Reclassifications. We have reclassified certain prior period amounts in the accompanying consolidated financial statements in order to be consistent with the current period presentation. These reclassifications had no effect on net income, total assets, total liabilities or equity. |
Marketable Securities | Marketable Securities. We classify our existing marketable equity securities as available-for-sale in accordance with the Financial Accounting Standards Board's (“FASB”) Investments-Debt and Equity Securities guidance. These securities are carried at fair value with unrealized gains and losses reported in equity as a component of accumulated other comprehensive income or loss. The fair value of the marketable securities is determined using Level 1 inputs under FASB Accounting Standards Codification (“ASC”) 820, “Fair Value Measurements and Disclosures.” Level 1 inputs represent quoted prices available in an active market for identical investments as of the reporting date. Gains and losses on securities sold are based on the specific identification method, and are reported as a component of interest, dividend and other investment income. |
Restricted Cash | Restricted Cash. We classify all cash pledged as collateral to secure certain obligations and all cash whose use is limited as restricted cash. During 2015, pursuant to the terms of our $15.1 million 4.99% Note, due January 6, 2024 (See Note 7), which is collateralized by our Anthem Marketplace property, we were required by the lenders thereunder to establish a cash management account controlled by the lenders to collect all amounts generated by our Anthem Marketplace property in order to collateralize such promissory note. As a result, these amounts are reported in the consolidated statements of cash flows under cash flows from financing activities as change in restricted cash. |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities. We utilize derivative financial instruments, principally interest rate swaps, to manage our exposure to fluctuations in interest rates. We have established policies and procedures for risk assessment, and the approval, reporting and monitoring of derivative financial instruments. We recognize our interest rate swaps as cash flow hedges with the effective portion of the changes in fair value recorded in comprehensive income (loss) and subsequently reclassified into earnings in the period that the hedged transaction affects earnings. Any ineffective portion of a cash flow hedges' change in fair value is recorded immediately into earnings. Our cash flow hedges are determined using Level 2 inputs under ASC 820. Level 2 inputs represent quoted prices in active markets for similar assets or liabilities; quoted prices in markets that are not active; and model-derived valuations whose inputs are observable. As of March 31, 2017, we consider our cash flow hedges to be highly effective. |
Development Properties | Development Properties. Land, buildings and improvements are recorded at cost. Expenditures related to the development of real estate are carried at cost which includes capitalized carrying charges and development costs. Carrying charges (interest, real estate taxes, loan fees, and direct and indirect development costs related to buildings under construction), are capitalized as part of construction in progress. The capitalization of such costs ceases when the property, or any completed portion, becomes available for occupancy. For the three months ended March 31, 2017, approximately $72,000 and $29,000 in interest expense and real estate taxes, respectively, were capitalized, and for the three months ended March 31, 2016, approximately $27,000 and $16,000 in interest expense and real estate taxes, respectively, were capitalized. |
Real Estate Held for Sale and Discontinued Operations | Real Estate Held for Sale and Discontinued Operations. We consider a commercial property to be held for sale when it meets all of the criteria established under ASC 205, “Presentation of Financial Statements.” For commercial properties classified as held for sale, assets and liabilities are presented separately for all periods presented. In accordance with ASC 205, a discontinued operation may include a component of an entity or a group of components of an entity. A disposal of a component of an entity or a group of components of an entity is reported in discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results when the component of an entity or group of components of an entity is classified as held for sale, disposed of by sale or disposed of other than by sale, respectively. In addition, ASC 205 requires us to provide additional disclosures about both discontinued operations and the disposal of an individually significant component of an entity that does not meet the criteria for a discontinued operation. |
Share-Based Compensation | Share-Based Compensation. From time to time, we award nonvested restricted common share awards or restricted common share unit awards, which may be converted into common shares, to executive officers and employees under our 2008 Long-Term Equity Incentive Ownership Plan (the “2008 Plan”). The vast majority of the awarded shares and units vest when certain performance conditions are met. We recognize compensation expense when achievement of the performance conditions is probable based on management's most recent estimates using the fair value of the shares as of the grant date. We recognized $2,451,000 and $2,025,000 in share-based compensation for the three months ended March 31, 2017 and 2016, respectively. |
Noncontrolling Interests | Noncontrolling Interests. Noncontrolling interests is the portion of equity in a subsidiary not attributable to a parent. The ownership interests not held by the parent are considered noncontrolling interests. Accordingly, we have reported noncontrolling interests in equity on the consolidated balance sheets but separate from Whitestone's equity. On the consolidated statements of operations, subsidiaries are reported at the consolidated amount, including both the amount attributable to Whitestone and noncontrolling interests. The consolidated statement of changes in equity is included for quarterly financial statements, including beginning balances, activity for the period and ending balances for shareholders' equity, noncontrolling interests and total equity. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements. In February 2016, the FASB issued guidance requiring lessees to recognize a lease liability and a right-of-use asset for all leases. Lessor accounting will remain largely unchanged with the exception of changes related to costs which qualify as initial direct costs. The guidance will also require new qualitative and quantitative disclosures to help financial statement users better understand the timing, amount and uncertainty of cash flows arising from leases. This guidance will be effective for reporting periods beginning on or after December 15, 2018, with early adoption permitted. We are currently evaluating the impact of this guidance and its impact on our consolidated financial statements. In March 2016, the FASB issued guidance simplifying the accounting for share-based payment transactions, including the income tax consequences, balance sheet classification of awards and the classification on the statement of cash flows. We have adopted this guidance as of January 1, 2017. The main provision regarding excess tax benefits did not have an impact on our consolidated financial statements due to our status as a REIT for taxation purposes. We have elected to continue estimating the number of shares expected to vest in order to determine compensation cost, and we will continue to classify cash paid by us for employee taxes when common shares were repurchased to cover minimum statutory requirements as financing activity. In November 2016, the FASB issued guidance requiring that the statement of cash flows explain the change during the period in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This guidance will become effective for the reporting periods beginning on or after December 15, 2017, and interim periods within those fiscal years. We are currently evaluating the impact of this guidance and its impact on our consolidated financial statements. In January 2017, the FASB issued guidance clarifying the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This guidance will become effective for the reporting periods beginning on or after December 15, 2017, and interim periods within those fiscal years. We are currently evaluating the impact of this guidance and its impact on our consolidated financial statements. In February 2017, the FASB issued guidance clarifying the scope of asset derecognition guidance, adds guidance for partial sales of nonfinancial assets and clarifies recognizing gains and losses from the transfer of nonfinancial assets in contracts with noncustomers. This guidance will become effective for the reporting periods beginning on or after December 15, 2017, and interim periods within those fiscal years. We are currently evaluating the impact of this guidance and its impact on our consolidated financial statements. |
Marketable Securities (Tables) |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Available-for-Sale Securities | All of our marketable securities were classified as available-for-sale securities as of March 31, 2017 and December 31, 2016. Available-for-sale securities consisted of the following (in thousands):
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Accrued Rents and Accounts Receivable, Net (Tables) |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accrued Rent and Accounts Receivable, Net | Accrued rents and accounts receivable, net consists of amounts accrued, billed and due from tenants, allowance for doubtful accounts and other receivables as follows (in thousands):
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Unamortized Leasing Commissions, Legal Fees and Loan Costs (Tables) |
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Unamortized Leasing Comissions and Loan Costs | Costs which have been deferred consist of the following (in thousands):
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Variable Interest Entities (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Variable Interest Entities | The carrying amounts and classification of certain assets and liabilities for Pillarstone OP in our consolidated balance sheets as of March 31, 2017 and December 31, 2016 consists of the following (in thousands):
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Debt (Tables) |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt | Debt consisted of the following as of the dates indicated (in thousands):
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Schedule of Maturities of Debt | Scheduled maturities of our outstanding debt as of March 31, 2017 were as follows (in thousands):
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Derivatives and Hedging Activities (Tables) |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of activity and fair value of interest rate swaps | The fair value of our interest rate swaps is as follows (in thousands):
A summary of our interest rate swap activity is as follows (in thousands):
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Earnings (Loss) Per Share (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share |
|
Equity (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Distributions | The following table summarizes the cash distributions paid or payable to holders of common shares and to holders of noncontrolling OP units during each quarter during 2016 and the three months ended March 31, 2017 (in thousands, except per share/unit data):
|
Incentive Share Plan (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Share-Based Incentive Plan Activity | A summary of the share-based incentive plan activity as of and for the three months ended March 31, 2017 is as follows:
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Nonvested and Vested Shares Activity | A summary of our non-vested and vested shares activity for the three months ended March 31, 2017 and years ended December 31, 2016, 2015 and 2014 is presented below:
|
Interim Financial Statements (Details) |
1 Months Ended | |
---|---|---|
Jul. 31, 2004 |
Mar. 31, 2017
property
|
|
Real Estate Properties [Line Items] | ||
Reorganization and conversion, number of common shares (in shares) | 1.42857 | |
Wholly Owned Properties [Member] | ||
Real Estate Properties [Line Items] | ||
Number of real estate properties | 69 |
Summary of Significant Accounting Policies (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Accounting Policies [Abstract] | ||
Conversion basis for common shares to OP units (in shares) | 1 | |
Debt Instrument [Line Items] | ||
Interest expense capitalized | $ 72,000 | $ 27,000 |
Real estate tax capitalized | 29,000 | 16,000 |
Share-based compensation | 2,451,000 | $ 2,025,000 |
Anthem Marketplace Note [Member] | ||
Debt Instrument [Line Items] | ||
Face amount of debt | $ 15,100,000.0 | |
Stated interest rate | 4.99% |
Marketable Securities (Details) - USD ($) |
3 Months Ended | ||||
---|---|---|---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
Dec. 31, 2016 |
|||
Schedule of Available-for-sale Securities [Line Items] | |||||
Amortized Cost | $ 654,000 | $ 654,000 | |||
Gains in Accumulated Other Comprehensive Income (Loss) | 0 | 0 | |||
Losses in Accumulated Other Comprehensive Income (Loss) | (137,000) | (137,000) | |||
Estimated Fair Value | [1] | 517,000 | 517,000 | ||
Proceeds from sales of marketable securities | 0 | $ 0 | |||
Net unrealized holding loss on available-for-sale securities | (137,000) | $ (224,000) | |||
Real Estate Common Stock [Member] | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Amortized Cost | 654,000 | 654,000 | |||
Gains in Accumulated Other Comprehensive Income (Loss) | 0 | 0 | |||
Losses in Accumulated Other Comprehensive Income (Loss) | (137,000) | (137,000) | |||
Estimated Fair Value | $ 517,000 | $ 517,000 | |||
|
Accrued Rents and Accounts Receivable, Net (Details) - USD ($) $ in Thousands |
Mar. 31, 2017 |
Dec. 31, 2016 |
||
---|---|---|---|---|
Receivables [Abstract] | ||||
Tenant receivables | $ 13,498 | $ 12,972 | ||
Accrued rents and other recoveries | 14,929 | 14,237 | ||
Allowance for doubtful accounts | (7,747) | (7,258) | ||
Total | [1] | $ 20,680 | $ 19,951 | |
|
Unamortized Leasing Commissions, Legal Fees and Loan Costs (Details) - USD ($) $ in Thousands |
Mar. 31, 2017 |
Dec. 31, 2016 |
||
---|---|---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||||
Leasing commissions | $ 8,789 | $ 8,720 | ||
Deferred legal cost | 219 | 0 | ||
Deferred financing cost | 4,071 | 4,071 | ||
Total cost | 13,079 | 12,791 | ||
Less: leasing commissions accumulated amortization | (3,856) | (3,597) | ||
Less: deferred legal cost accumulated amortization | (17) | 0 | ||
Less: deferred financing cost accumulated amortization | (1,349) | (1,111) | ||
Total cost, net of accumulated amortization | [1] | $ 7,857 | $ 8,083 | |
|
Variable Interest Entities (Details) $ / shares in Units, $ in Thousands |
Dec. 31, 2016
USD ($)
|
Dec. 08, 2016
USD ($)
property
subsidiary
$ / shares
|
Mar. 31, 2017
USD ($)
|
Mar. 31, 2016
USD ($)
|
Dec. 31, 2015
USD ($)
|
|||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Real estate assets, at cost | ||||||||||||
Property | [1] | $ 920,310 | $ 924,280 | |||||||||
Accumulated depreciation | [1] | (107,258) | (112,418) | |||||||||
Total real estate assets | [1] | 813,052 | 811,862 | |||||||||
Cash and cash equivalents | 4,168 | [1] | 6,503 | [1] | $ 2,447 | $ 2,587 | ||||||
Escrows and acquisition deposits | [1] | 6,620 | 5,740 | |||||||||
Accrued rents and accounts receivable, net of allowance for doubtful accounts | [1] | 19,951 | 20,680 | |||||||||
Unamortized lease commissions and loan costs | [1] | 8,083 | 7,857 | |||||||||
Prepaid expenses and other assets | [1] | 2,762 | 3,519 | |||||||||
Total assets | [1] | 855,209 | 856,834 | |||||||||
Liabilities: | ||||||||||||
Notes payable | [2] | 544,020 | 555,399 | |||||||||
Accounts payable and accrued expenses | [2] | 28,692 | 18,044 | |||||||||
Tenants' security deposits | [2] | 6,125 | 6,279 | |||||||||
Total liabilities | [2] | $ 587,566 | 588,605 | |||||||||
Pillarstone Variable Interest Entity | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Number of wholly-owned subsidiaries contributed to variable interest entity | subsidiary | 4 | |||||||||||
Number of non-core properties contributed to variable interest entity | property | 14 | |||||||||||
Consideration amount | $ 84,000 | |||||||||||
Consideration, limited partnership interest | $ 18,100 | |||||||||||
Consideration, limited partnership interest (in dollars per share) | $ / shares | $ 1.331 | |||||||||||
Liabilities assumed | $ 65,900 | |||||||||||
OP unit purchase agreement amount | $ 3,000 | |||||||||||
OP unit purchase agreement unit price (in dollars per share) | $ / shares | $ 1.331 | |||||||||||
OP unit purchase agreement term | 2 years | |||||||||||
Monthly property management fee | 5.00% | |||||||||||
Monthly asset management fee | 0.125% | |||||||||||
Ownership percentage | 81.40% | |||||||||||
Real estate assets, at cost | ||||||||||||
Property | $ 92,338 | 94,035 | ||||||||||
Accumulated depreciation | (32,533) | (34,183) | ||||||||||
Total real estate assets | 59,805 | 59,852 | ||||||||||
Cash and cash equivalents | 1,236 | 1,300 | ||||||||||
Escrows and acquisition deposits | 2,274 | 778 | ||||||||||
Accrued rents and accounts receivable, net of allowance for doubtful accounts | 2,313 | 2,490 | ||||||||||
Unamortized lease commissions and loan costs | 1,150 | 1,100 | ||||||||||
Prepaid expenses and other assets | 82 | 259 | ||||||||||
Total assets | 66,860 | 65,779 | ||||||||||
Liabilities: | ||||||||||||
Notes payable | 50,001 | 49,713 | ||||||||||
Accounts payable and accrued expenses | 3,481 | 1,646 | ||||||||||
Tenants' security deposits | 996 | 1,056 | ||||||||||
Total liabilities | 54,478 | 52,415 | ||||||||||
Pillarstone Variable Interest Entity | Consolidation, Eliminations [Member] | ||||||||||||
Real estate assets, at cost | ||||||||||||
Accrued rents and accounts receivable, net of allowance for doubtful accounts | 500 | 2,000 | ||||||||||
Prepaid expenses and other assets | 900 | 0 | ||||||||||
Liabilities: | ||||||||||||
Notes payable | 15,500 | 15,500 | ||||||||||
Accounts payable and accrued expenses | $ 300 | $ 1,000 | ||||||||||
Pillarstone Variable Interest Entity | Uptown Tower [Member] | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Monthly property management fee | 3.00% | |||||||||||
Monthly asset management fee | 0.125% | |||||||||||
Pillarstone Variable Interest Entity | Line of Credit [Member] | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Liabilities assumed | $ 15,500 | |||||||||||
Pillarstone Variable Interest Entity | Notes Payable, Other Payables [Member] | Uptown Tower Promissory Note [Member] | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Liabilities assumed | 16,300 | |||||||||||
Pillarstone Variable Interest Entity | Notes Payable, Other Payables [Member] | Industrial-Office Promissory Note [Member] | ||||||||||||
Variable Interest Entity [Line Items] | ||||||||||||
Liabilities assumed | $ 34,100 | |||||||||||
|
Debt (Schedule of Debt) (Details) - USD ($) |
3 Months Ended | 12 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Nov. 07, 2014 |
Mar. 31, 2017 |
Mar. 31, 2016 |
Dec. 31, 2014 |
Feb. 03, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
Aug. 08, 2012 |
|
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | $ 556,819,000 | $ 545,512,000 | ||||||
Less deferred financing costs, net of accumulated amortization | (1,420,000) | (1,492,000) | ||||||
Total notes payable | 555,399,000 | 544,020,000 | ||||||
Fixed rate notes | $10.5 million, LIBOR plus 2.00% Note, due September 24, 2018 | LIBOR Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | 9,920,000 | 9,980,000 | ||||||
Face amount of debt | $ 10,500,000.0 | 10,500,000.0 | ||||||
Basis spread on variable rate | 2.00% | 2.00% | ||||||
Fixed rate notes | $50.0 million, 0.84% plus 1.35% to 1.90% Note, due October 30, 2020 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | $ 50,000,000 | 50,000,000 | ||||||
Face amount of debt | $ 50,000,000.0 | $ 50,000,000.0 | ||||||
Imputed interest rate | 0.84% | 0.84% | ||||||
Fixed rate notes | $50.0 million, 0.84% plus 1.35% to 1.90% Note, due October 30, 2020 | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.35% | 1.35% | ||||||
Fixed rate notes | $50.0 million, 0.84% plus 1.35% to 1.90% Note, due October 30, 2020 | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.90% | 1.90% | ||||||
Fixed rate notes | $50.0 million, 1.50% plus 1.35% to 1.90% Note, due January 29, 2021 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | 50,000,000 | $ 50,000,000 | ||||||
Face amount of debt | $ 50,000,000.0 | $ 50,000,000.0 | ||||||
Imputed interest rate | 1.50% | 1.50% | ||||||
Fixed rate notes | $50.0 million, 1.50% plus 1.35% to 1.90% Note, due January 29, 2021 | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.35% | 1.35% | ||||||
Fixed rate notes | $50.0 million, 1.50% plus 1.35% to 1.90% Note, due January 29, 2021 | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.90% | 1.90% | ||||||
Fixed rate notes | $100.0 million, 1.73% plus 1.65% to 2.25% Note, due October 30, 2022 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | 100,000,000 | $ 100,000,000 | ||||||
Face amount of debt | $ 100,000,000.0 | $ 100,000,000.0 | ||||||
Imputed interest rate | 1.73% | 1.73% | ||||||
Fixed rate notes | $100.0 million, 1.73% plus 1.65% to 2.25% Note, due October 30, 2022 | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.65% | 1.65% | ||||||
Fixed rate notes | $100.0 million, 1.73% plus 1.65% to 2.25% Note, due October 30, 2022 | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 2.25% | 2.25% | ||||||
Fixed rate notes | $37.0 million 3.76% Note, due December 1, 2020 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | $ 33,915,000 | $ 34,166,000 | ||||||
Stated interest rate | 3.76% | 3.76% | ||||||
Face amount of debt | $ 37,000,000.0 | $ 37,000,000.0 | ||||||
Fixed rate notes | $6.5 million 3.80% Note, due January 1, 2019 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | $ 5,975,000 | $ 6,019,000 | ||||||
Stated interest rate | 3.80% | 3.80% | ||||||
Face amount of debt | $ 6,500,000.0 | $ 6,500,000.0 | ||||||
Fixed rate notes | $19.0 million 4.15% Note, due December 1, 2024 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | $ 19,000,000 | $ 19,000,000 | ||||||
Stated interest rate | 4.15% | 4.15% | ||||||
Face amount of debt | $ 19,000,000.0 | $ 19,000,000.0 | ||||||
Fixed rate notes | $20.2 million 4.28% Note, due June 6, 2023 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | $ 19,620,000 | $ 19,708,000 | ||||||
Stated interest rate | 4.28% | 4.28% | ||||||
Face amount of debt | $ 20,200,000.0 | $ 20,200,000.0 | ||||||
Fixed rate notes | $14.0 million 4.34% Note, due September 11, 2024 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | $ 14,000,000 | $ 14,000,000 | ||||||
Stated interest rate | 4.34% | 4.34% | ||||||
Face amount of debt | $ 14,000,000.0 | $ 14,000,000.0 | ||||||
Fixed rate notes | $14.3 million 4.34% Note, due September 11, 2024 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | $ 14,300,000 | $ 14,300,000 | ||||||
Stated interest rate | 4.34% | 4.34% | ||||||
Face amount of debt | $ 14,300,000.0 | $ 14,300,000.0 | ||||||
Fixed rate notes | $16.5 million 4.97% Note, due September 26, 2023 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | $ 16,236,000 | $ 16,298,000 | ||||||
Stated interest rate | 4.97% | 4.97% | ||||||
Face amount of debt | $ 16,500,000.0 | $ 16,500,000.0 | ||||||
Fixed rate notes | $15.1 million 4.99% Note, due January 6, 2024 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | $ 15,022,000 | $ 15,060,000 | ||||||
Stated interest rate | 4.99% | 4.99% | ||||||
Face amount of debt | $ 15,100,000.0 | $ 15,100,000.0 | ||||||
Fixed rate notes | $9.2 million, Prime Rate less 2.00% Note, due December 29, 2017 | ||||||||
Debt Instrument [Line Items] | ||||||||
Unamortized discount | $ 1,300,000 | |||||||
Imputed interest rate | 4.13% | |||||||
Fixed rate notes | $9.2 million, Prime Rate less 2.00% Note, due December 29, 2017 | Prime Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | 7,860,000 | 7,869,000 | ||||||
Face amount of debt | $ 9,200,000.0 | 9,200,000.0 | ||||||
Basis spread on variable rate | 2.00% | 2.00% | ||||||
Fixed rate notes | $2.6 million 5.46% Note, due October 1, 2023 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | $ 2,502,000 | $ 2,512,000 | ||||||
Stated interest rate | 5.46% | 5.46% | ||||||
Face amount of debt | $ 2,600,000.0 | $ 2,600,000.0 | ||||||
Fixed rate notes | $1.1 million 2.97% Note, due November 28, 2016 | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | $ 869,000 | $ 0 | ||||||
Stated interest rate | 2.97% | 2.97% | ||||||
Face amount of debt | $ 1,100,000.0 | $ 1,100,000.0 | ||||||
Floating rate notes | Unsecured line of credit, LIBOR plus 1.40% to 1.95%, due October 30, 2019 | LIBOR Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Total notes payable principal | $ 197,600,000 | $ 186,600,000 | ||||||
Floating rate notes | Unsecured line of credit, LIBOR plus 1.40% to 1.95%, due October 30, 2019 | Minimum | LIBOR Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.40% | 1.40% | ||||||
Floating rate notes | Unsecured line of credit, LIBOR plus 1.40% to 1.95%, due October 30, 2019 | Maximum | LIBOR Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.95% | 1.95% | ||||||
Interest rate swap | $10.5 million, LIBOR plus 2.00% Note, due September 24, 2018 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 3.55% | |||||||
Interest rate swap | $50.0 million, 0.84% plus 1.35% to 1.90% Note, due October 30, 2020 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 0.84% | 1.75% | ||||||
Interest rate swap | $50.0 million, 1.50% plus 1.35% to 1.90% Note, due January 29, 2021 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 1.50% | |||||||
Interest rate swap | $100.0 million, 1.73% plus 1.65% to 2.25% Note, due October 30, 2022 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 1.73% | |||||||
Interest rate swap | $9.2 million, Prime Rate less 2.00% Note, due December 29, 2017 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 5.72% | |||||||
Term loan | Minimum | LIBOR Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.35% | |||||||
Term loan | Maximum | LIBOR Rate | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 2.25% |
Debt (Narrative) (Details) |
Nov. 07, 2014
USD ($)
|
Mar. 31, 2017
USD ($)
property
|
---|---|---|
Debt Instrument [Line Items] | ||
Secured debt | $ 158,400,000 | |
Number of collateralized properties (in collateralized properties) | property | 19 | |
Carrying value of collateralized properties | $ 189,000,000 | |
Revolving credit facility | ||
Debt Instrument [Line Items] | ||
Credit facility, maximum borrowing capacity | $ 300,000,000 | |
Credit facility, expanded maximum borrowing capacity | 700,000,000 | |
Line of credit outstanding | 397,600,000 | |
Credit facility, remaining borrowing capacity | 102,400,000 | |
Revolving credit facility | LIBOR Rate | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 1.00% | |
Revolving credit facility | LIBOR Rate | Minimum | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 1.40% | |
Revolving credit facility | LIBOR Rate | Maximum | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 1.95% | |
Term loan | LIBOR Rate | Minimum | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 1.35% | |
Term loan | LIBOR Rate | Maximum | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 2.25% | |
Term loan | Term Loan 1 [Member] | ||
Debt Instrument [Line Items] | ||
Face amount of debt | $ 50,000,000 | |
Term loan | Term Loan 2 [Member] | ||
Debt Instrument [Line Items] | ||
Face amount of debt | 50,000,000 | |
Term loan | Term Loan 3 [Member] | ||
Debt Instrument [Line Items] | ||
Face amount of debt | $ 100,000,000 | |
Pillarstone [Member] | Revolving credit facility | ||
Debt Instrument [Line Items] | ||
Line of credit outstanding | $ 15,500,000 |
Debt (Schedule of Maturities of Debt) (Details) - USD ($) $ in Thousands |
Mar. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Debt Disclosure [Abstract] | ||
2017 | $ 10,562 | |
2018 | 12,136 | |
2019 | 205,649 | |
2020 | 82,827 | |
2021 | 51,918 | |
Thereafter | 193,727 | |
Total | $ 556,819 | $ 545,512 |
Derivatives and Hedging Activities (Details) - USD ($) $ in Thousands |
3 Months Ended | ||||
---|---|---|---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2016 |
Nov. 19, 2015 |
|
Term Loan 1 [Member] | |||||
Derivative [Line Items] | |||||
Interest Rate Swap Assigned to Counterparty | $ 14,000 | ||||
U.S. Bank National Association [Member] | Term Loan 3 [Member] | |||||
Derivative [Line Items] | |||||
Interest Rate Swap Assigned to Counterparty | 35,000 | ||||
U.S. Bank National Association [Member] | Term Loan 1 [Member] | |||||
Derivative [Line Items] | |||||
Interest Rate Swap Assigned to Counterparty | 6,500 | ||||
U.S. Bank National Association [Member] | Term Loan 2 [Member] | |||||
Derivative [Line Items] | |||||
Interest Rate Swap Assigned to Counterparty | 6,500 | ||||
Wells Fargo Bank, National Association [Member] | Term Loan 1 [Member] | |||||
Derivative [Line Items] | |||||
Interest Rate Swap Assigned to Counterparty | 14,000 | ||||
Wells Fargo Bank, National Association [Member] | Term Loan 2 [Member] | |||||
Derivative [Line Items] | |||||
Interest Rate Swap Assigned to Counterparty | 14,000 | ||||
Bank of American, N.A. [Member] | Term Loan 2 [Member] | |||||
Derivative [Line Items] | |||||
Interest Rate Swap Assigned to Counterparty | 14,000 | ||||
SunTrust Bank [Member] | Term Loan 3 [Member] | |||||
Derivative [Line Items] | |||||
Interest Rate Swap Assigned to Counterparty | 15,000 | ||||
SunTrust Bank [Member] | Term Loan 1 [Member] | |||||
Derivative [Line Items] | |||||
Interest Rate Swap Assigned to Counterparty | 5,000 | ||||
SunTrust Bank [Member] | Term Loan 2 [Member] | |||||
Derivative [Line Items] | |||||
Interest Rate Swap Assigned to Counterparty | 5,000 | ||||
Regions Bank [Member] | Term Loan 1 [Member] | |||||
Derivative [Line Items] | |||||
Interest Rate Swap Assigned to Counterparty | 3,800 | ||||
Regions Bank [Member] | Term Loan 2 [Member] | |||||
Derivative [Line Items] | |||||
Interest Rate Swap Assigned to Counterparty | $ 3,800 | ||||
Interest Rate Swaps [Member] | Interest Expense [Member] | |||||
Derivative [Line Items] | |||||
Amount Recognized as Comprehensive Income (Loss) | $ 732 | $ (6,041) | |||
Amount of Gain (Loss) Recognized in Earnings | (508) | $ (594) | |||
Interest Rate Swaps [Member] | Cash Flow Hedging [Member] | Term Loan 3 [Member] | |||||
Derivative [Line Items] | |||||
Fixed interest rate | 1.725% | ||||
Interest Rate Swaps [Member] | Cash Flow Hedging [Member] | Term Loan 1 [Member] | |||||
Derivative [Line Items] | |||||
Fixed interest rate | 1.75% | ||||
Interest Rate Swaps [Member] | Cash Flow Hedging [Member] | Term Loan 2 [Member] | |||||
Derivative [Line Items] | |||||
Fixed interest rate | 1.50% | ||||
Accounts Payable and Accrued Expenses [Member] | Interest Rate Swaps [Member] | |||||
Derivative [Line Items] | |||||
Estimated Fair Value | $ (1,482) | $ (662) |
Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Distributions to holders of certain restricted common shares charged against earnings | $ 2,451 | $ 2,025 |
Numerator: | ||
Net income | 1,557 | 5,088 |
Less: Net income attributable to noncontrolling interests | (117) | (91) |
Distributions paid on unvested restricted shares | (91) | (155) |
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares | $ 1,349 | $ 4,842 |
Denominator: | ||
Weighted average number of common shares - basic (in shares) | 29,416,000 | 26,604,000 |
Effect of dilutive securities: | ||
Unvested restricted shares (in shares) | 993,000 | 885,000 |
Weighted average number of common shares - dilutive (in shares) | 30,409,000 | 27,489,000 |
Basic: | ||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares (in dollars per share) | $ 0.05 | $ 0.18 |
Diluted: | ||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares (in dollars per share) | $ 0.04 | $ 0.18 |
OP Units [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
OP units excluded from diluted earnings per share because their effect would be anti-dilutive | 1,099,827 | 491,023 |
Restricted Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Distributions to holders of certain restricted common shares | $ 95 | $ 155 |
Distributions to holders of certain restricted common shares charged against earnings | $ 4 | $ 0 |
Income Taxes (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Income Tax Contingency [Line Items] | ||
Provision for income taxes | $ 81 | $ 156 |
Texas [Member] | ||
Income Tax Contingency [Line Items] | ||
Applicable tax rate used to determine state margin tax | 0.75% | |
Standard deduction rate used to determine state margin tax | 30.00% | |
Margin tax provision recognized | $ 79 | 114 |
Davenport TRS [Member] | ||
Income Tax Contingency [Line Items] | ||
Provision for income taxes | $ 45 |
Equity (Details) $ / shares in Units, $ in Thousands |
3 Months Ended | 12 Months Ended | |||||
---|---|---|---|---|---|---|---|
Mar. 31, 2017
USD ($)
$ / shares
shares
|
Dec. 31, 2016
USD ($)
$ / shares
shares
|
Sep. 30, 2016
USD ($)
$ / shares
|
Jun. 30, 2016
USD ($)
$ / shares
|
Mar. 31, 2016
USD ($)
$ / shares
shares
|
Dec. 31, 2016
USD ($)
$ / shares
shares
|
Jun. 04, 2015
USD ($)
agreement
|
|
Class of Stock [Line Items] | |||||||
Common shares, authorized (in shares) | 400,000,000 | 400,000,000 | 400,000,000 | ||||
Common shares, par value per share (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | ||||
Preferred shares, shares authorized (in shares) | 50,000,000 | 50,000,000 | 50,000,000 | ||||
Preferred shares, par value per share (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | ||||
Common shares, issued (in shares) | 29,871,458 | 29,468,563 | 29,468,563 | ||||
Proceeds from issuance of common shares, net of offering costs | $ | $ 5,334 | $ 0 | |||||
Equity distribution agreements, authorized amount | $ | $ 50,000 | ||||||
Number of equity distribution agreements | agreement | 6 | ||||||
Ownership interest in operating partnership | 96.40% | ||||||
Conversion basis for common shares to OP units (in shares) | 1 | ||||||
Weighted-average share ownership in operating partnership | 96.40% | 98.20% | |||||
Preferred Stock [Member] | |||||||
Class of Stock [Line Items] | |||||||
Preferred shares, shares authorized (in shares) | 50,000,000 | ||||||
Preferred shares, par value per share (in dollars per share) | $ / shares | $ 0.001 | ||||||
OP Units [Member] | |||||||
Class of Stock [Line Items] | |||||||
OP units outstanding (in shares) | 30,845,917 | 30,450,377 | 30,450,377 | ||||
OP units owned (in shares) | 29,750,636 | 29,347,741 | 29,347,741 | ||||
Conversion of stock, shares converted (in shares) | 7,355 | 12,101 | |||||
2015 Equity Distribution Agreement [Member] | |||||||
Class of Stock [Line Items] | |||||||
Issuance of common shares, net of offering costs (in shares) | 390,726 | ||||||
Proceeds from issuance of common shares, net of offering costs | $ | $ 5,300 | ||||||
Payments for compensation to sales agents | $ | 100 | ||||||
Cash Distribution [Member] | |||||||
Class of Stock [Line Items] | |||||||
Cash distribution paid | $ | $ 8,766 | $ 8,619 | $ 8,247 | $ 7,924 | $ 7,850 | $ 32,640 | |
Cash Distribution [Member] | Common Stock [Member] | |||||||
Class of Stock [Line Items] | |||||||
Cash distribution paid (in dollars per share) | $ / shares | $ 0.2850 | $ 0.2850 | $ 0.2850 | $ 0.2850 | $ 0.2850 | $ 1.1400 | |
Cash distribution paid | $ | $ 8,453 | $ 8,305 | $ 8,109 | $ 7,786 | $ 7,711 | $ 31,911 | |
Cash Distribution [Member] | OP Units [Member] | |||||||
Class of Stock [Line Items] | |||||||
Cash distribution paid (in dollars per share) | $ / shares | $ 0.2850 | $ 0.2850 | $ 0.2850 | $ 0.2850 | $ 0.2850 | $ 1.1400 | |
Cash distribution paid | $ | $ 313 | $ 314 | $ 138 | $ 138 | $ 139 | $ 729 |
Incentive Share Plan (Narrative) (Details) $ in Thousands |
3 Months Ended | |||||
---|---|---|---|---|---|---|
Jun. 30, 2016
shares
|
Jun. 30, 2015
shares
|
Apr. 02, 2014
employee
shares
|
Mar. 31, 2017
USD ($)
|
Mar. 31, 2016
USD ($)
|
Dec. 22, 2010 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based compensation | $ 2,451 | $ 2,025 | ||||
Minimum | Time-Based Vesting [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 1 year | |||||
Maximum | Time-Based Vesting [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Award vesting period | 2 years | |||||
Restricted Common Shares and Restricted Share Units [Member] | Time and Performance-Based Vesting [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of employees granted an award | employee | 51 | |||||
Aggregate shares granted (in shares) | shares | 633,704 | |||||
Restricted Common Shares and Restricted Share Units [Member] | Time-Based Vesting [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Aggregate shares granted (in shares) | shares | 320,000 | 143,000 | ||||
Restricted Common Shares and Restricted Share Units [Member] | Performance Vesting [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Aggregate shares granted (in shares) | shares | 2,049,116 | |||||
Non-Cash Share Based Compensation in 2014 [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation cost | 8,600 | |||||
Non-Cash Share Based Compensation Subsequent to 2014 [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation cost | $ 2,500 | |||||
Unrecognized compensation cost, period for recognition | 16 months | |||||
2008 Long-Term Equity Incentive Ownership Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Percentage of maximum number of shares issued under plan to aggregate shares | 12.50% | |||||
2008 Long-Term Equity Incentive Ownership Plan [Member] | Restricted Common Shares and Restricted Share Units [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage | 82.00% | |||||
2008 Long-Term Equity Incentive Ownership Plan [Member] | Performance Shares [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation cost | $ 3,200 | |||||
Award vesting period | 24 months | |||||
2008 Long-Term Equity Incentive Ownership Plan [Member] | Non-Vested Time Based Shares [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation cost | $ 5,400 | |||||
Unrecognized compensation cost, period for recognition | 12 months |
Incentive Share Plan (Schedule of Share-Based Incentive Plan Activity) (Details) - 2008 Long-Term Equity Incentive Ownership Plan [Member] - $ / shares |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||
Shares, Non-vested (in shares) | 2,044,334 | |||
Weighted-Average Grant Date Fair Value, Non-vested (in dollars per share) | $ 14.48 | |||
Shares, Granted (in shares) | 23,200 | 545,778 | 327,122 | 2,058,930 |
Weighted-Average Grant Date Fair Value, Granted (in dollars per share) | $ 13.91 | $ 14.85 | $ 13.49 | $ 14.40 |
Shares, Vested (in shares) | (102,448) | (734,261) | (348,786) | (133,774) |
Weighted-Average Grant Date Fair Value, Vested (in dollars per share) | $ 14.63 | |||
Shares, Forfeited (in shares) | (5,951) | |||
Weighted-Average Grant Date Fair Value, Forfeited (in dollars per share) | $ 13.66 | |||
Shares, Non-vested (in shares) | 1,959,135 | 2,044,334 | ||
Weighted-Average Grant Date Fair Value, Non-vested (in dollars per share) | $ 14.46 | $ 14.48 | ||
Shares, Available for grant (in shares) | 890,449 |
Incentive Share Plan (Schedule of Nonvested and Vested Shares Activity) (Details) - 2008 Long-Term Equity Incentive Ownership Plan [Member] - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares, Granted, Non-Vested Shares Isused (in shares) | 23,200 | 545,778 | 327,122 | 2,058,930 |
Shares Granted, Weighted-Average Grant Date Fair Value, Granted (in dollars per share) | $ 13.91 | $ 14.85 | $ 13.49 | $ 14.40 |
Shares, Vested (in shares) | (102,448) | (734,261) | (348,786) | (133,774) |
Shares Vested, Total Vest-Date Fair Value | $ 1,499 | $ 10,577 | $ 4,969 | $ 1,721 |
Grants to Trustees (Details) |
Dec. 21, 2016
trustee
$ / shares
shares
|
Dec. 21, 2015
trustee
$ / shares
shares
|
---|---|---|
Individual Trustee Grant Agreements 1 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of independent trustees (in trustees) | trustee | 4 | |
Number of trustee emeritus (in trustees) | trustee | 1 | |
Individual Trustee Grant Agreements 1 [Member] | Common Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted stock granted to each trustee (in shares) | shares | 7,500 | |
Restricted stock granted to trustees, vested in period (in shares) | shares | 1,500 | |
Restricted stock granted to trustees, weighted-average grant date fair value (in dollars per share) | $ / shares | $ 14.07 | |
Individual Trustee Grant Agreements 2 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of independent trustees (in trustees) | trustee | 2 | |
Individual Trustee Grant Agreements 2 [Member] | Common Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted stock granted to each trustee (in shares) | shares | 3,128 | |
Restricted stock granted to trustees, weighted-average grant date fair value (in dollars per share) | $ / shares | $ 14.07 |
Real Estate (Details) $ in Thousands |
3 Months Ended | |||||
---|---|---|---|---|---|---|
Sep. 30, 2016
USD ($)
shares
|
Mar. 03, 2016
USD ($)
|
Feb. 17, 2016
USD ($)
a
|
Mar. 31, 2017
USD ($)
ft²
shares
|
Mar. 31, 2016
USD ($)
|
Dec. 31, 2016
ft²
|
|
Real Estate [Line Items] | ||||||
Conversion basis for common shares to OP units (in shares) | shares | 1 | |||||
Gain on sale of properties | $ 0 | $ 2,890 | ||||
Loss (gain) on sale or disposal of assets and properties | $ (23) | $ 2,892 | ||||
La Mirada and Seville [Member] | ||||||
Real Estate [Line Items] | ||||||
Consideration transfered | $ 60,700 | |||||
Equity interest (in shares) | shares | 621,053 | |||||
Conversion basis for common shares to OP units (in shares) | shares | 1 | |||||
La Mirada [Member] | ||||||
Real Estate [Line Items] | ||||||
Gross leasable area (in square feet) | ft² | 147,209 | |||||
Property percentage occupied | 90.00% | |||||
Seville [Member] | ||||||
Real Estate [Line Items] | ||||||
Gross leasable area (in square feet) | ft² | 90,042 | |||||
Property percentage occupied | 88.00% | |||||
Pinnacle of Scottsdale Phase II [Member] | ||||||
Real Estate [Line Items] | ||||||
Gross leasable area (in square feet) | ft² | 27,063 | |||||
Property percentage occupied | 44.00% | |||||
Construction Payable | $ 4,500 | |||||
Capitalized Interest and Real Estate Taxes | $ 500 | |||||
Shops at Starwood Phase III [Member] | ||||||
Real Estate [Line Items] | ||||||
Gross leasable area (in square feet) | ft² | 35,351 | |||||
Property percentage occupied | 50.00% | |||||
Construction Payable | $ 7,600 | |||||
Capitalized Interest and Real Estate Taxes | $ 800 | |||||
Brookhill [Member] | ||||||
Real Estate [Line Items] | ||||||
Proceeds from the sale of real estate | $ 3,100 | |||||
Gain on sale of properties | $ 1,900 | |||||
Pinnacle Phase II [Member] | ||||||
Real Estate [Line Items] | ||||||
Area of land (in acres) | a | 4.5 | |||||
Proceeds from the sale of real estate | $ 1,100 | |||||
Area of land sold | a | 0.5 | |||||
Gain on sale of properties | $ 1,000 |
Subsequent Events (Details) $ / shares in Units, $ in Thousands |
3 Months Ended | ||||
---|---|---|---|---|---|
May 03, 2017
USD ($)
ft²
|
Apr. 25, 2017
USD ($)
$ / shares
shares
|
Apr. 19, 2017
USD ($)
|
Mar. 31, 2017
USD ($)
|
Mar. 31, 2016
USD ($)
|
|
Subsequent Event [Line Items] | |||||
Proceeds from issuance of common shares, net of offering costs | $ 5,334 | $ 0 | |||
Subsequent Event [Member] | April Offering [Member] | |||||
Subsequent Event [Line Items] | |||||
Issuance of common shares, net of offering costs (in shares) | shares | 8,018,500 | ||||
Share price (in shares) | $ / shares | $ 12.48 | ||||
Proceeds from issuance of common shares, net of offering costs | $ 99,900 | ||||
Subsequent Event [Member] | Underwriter Option [Member] | |||||
Subsequent Event [Line Items] | |||||
Issuance of common shares, net of offering costs (in shares) | shares | 1,018,500 | ||||
El Dorado Plaza [Member] | Subsequent Event [Member] | |||||
Subsequent Event [Line Items] | |||||
Consideration transfered | $ 46,600 | ||||
Gross leasable area (in square feet) | ft² | 221,577 | ||||
Property percentage occupied | 96.00% | ||||
Scenario, Forecast [Member] | Two Retail Centers [Member] | |||||
Subsequent Event [Line Items] | |||||
Cash purchase price | $ 204,600 | ||||
Scenario, Forecast [Member] | BLVD Place [Member] | |||||
Subsequent Event [Line Items] | |||||
Mortgage financing | $ 80,000 |
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