Related Party Arrangements

3 Months Ended

Mar. 31, 2015

Related Party Transactions [Abstract]

Related Party Arrangements

Related Party Arrangements

We purchase certain administrative services from BHT Advisors, LLC (“BHT Advisors”), such as human resources, shareholder services, and information technology. We also pay BHT Advisors acquisition fees related to the development of Two BriarLake Plaza. HPT Management Services, LLC (“HPT Management”) provides property management services for our properties. Current board members, Messrs. Robert S. Aisner and M. Jason Mattox, serve as officers and are partial owners of the ultimate parent entity of BHT Advisors and HPT Management.

Pursuant to the administrative services agreement entered into on August 31, 2012, we provided notice to BHT Advisors on April 1, 2015, of our termination of the administrative services agreement effective June 30, 2015. Upon notice of termination, we were required to pay BHT Advisors approximately $2.7 million, which represents 0.75 times the gross amount of all service charges payable with respect to such terminated services for the trailing 12-month period ending with the last full month prior to the delivery of notice of termination.

Pursuant to the property management agreement entered into on August 31, 2012, we provided notice to HPT Management on April 1, 2015, of the exercise of our buyout option and proposed a closing to occur on June 30, 2015, whereupon (1) we will acquire and assume certain assets and certain liabilities of HPT Management and (2) HPT Management will be deemed to have irrevocably waived the non-solicitation and non-hire provisions of the management agreement with respect to certain persons, including employees of HPT Management providing property management functions on our behalf. Upon closing of the buyout, we will be required to pay HPT Management an amount, in cash, equal to 0.8 times the gross amount of all management and oversight fees earned by HPT Management under the management agreement for the trailing 12-month period ending with the last full month prior to delivery of the notice.

The following is a summary of the related party fees and costs we incurred with BHT Advisors and HPT Management during the three months ended March 31, 2015 and 2014 (in thousands):

	Three Months Ended
	March 31, 2015		March 31, 2014
BHT Advisors, acquisition fees	$	100	$	207
BHT Advisors, cost of services provided	650		640
HPT Management, property and construction management fees	2,870		2,794
HPT Management, reimbursement of costs and expenses	4,256		4,497
Total	$	7,876	$	8,138
Expensed	$	7,316	$	7,643
Capitalized to real estate under development	—		207
Capitalized to buildings and improvements, net	560		288
Total	$	7,876	$	8,138

At March 31, 2015, and December 31, 2014, we had payables to related parties of approximately $2.3 million and $2.0 million, respectively, consisting primarily of expense reimbursements payable to BHT Advisors and property management fees payable to HPT Management.