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Acquisitions and Developments in Progress
 9 Months Ended
Sep. 30, 2020
Business Combinations [Abstract]  
Acquisitions and Developments in Progress ACQUISITIONS AND DEVELOPMENTS IN PROGRESS
Acquisitions
The Company closed on the following acquisition during the nine months ended September 30, 2020:
DateProperty NameMetropolitan
Statistical Area (MSA)		Property TypeSquare
Footage		Acquisition
Price
February 6, 2020Fullerton MetrocenterLos AngelesFee interest (a)154,700 $55,000 
154,700 $55,000 (b)
(a)The Company acquired the fee interest in an existing multi-tenant retail operating property. In connection with this acquisition, the Company also assumed the lessor position in a ground lease with a shadow anchor.
(b)Acquisition price does not include capitalized closing costs and adjustments totaling $240.
The Company closed on the following acquisitions during the nine months ended September 30, 2019:
DateProperty NameMSAProperty TypeSquare
Footage		Acquisition
Price
March 7, 2019North Benson CenterSeattleMulti-tenant retail70,500 $25,340 
June 10, 2019Paradise Valley Marketplace – ParcelPhoenixLand (a)— 1,343 
August 13, 2019Southlake Town Square – ParcelDallasSingle-user parcel (b)3,100 3,293 
73,600 $29,976 (c)
(a)The Company acquired a parcel adjacent to its Paradise Valley Marketplace multi-tenant retail operating property. The total number of properties in the Company’s portfolio was not affected by this transaction.
(b)The Company acquired a single-user parcel at its Southlake Town Square multi-tenant retail operating property. The total number of properties in the Company’s portfolio was not affected by this transaction.
(c)Acquisition price does not include capitalized closing costs and adjustments totaling $316.
The following table summarizes the acquisition date values, before prorations, the Company recorded in conjunction with the acquisitions discussed above:
Nine Months Ended September 30,
20202019
Land$57,137 $14,819 
Building and other improvements, net1,623 13,667 
Acquired lease intangible assets (a)2,014 2,040 
Acquired lease intangible liabilities (b)(5,534)(234)
Net assets acquired$55,240 $30,292 
(a)The weighted average amortization period for acquired lease intangible assets is 17 years and six years for acquisitions completed during the nine months ended September 30, 2020 and 2019, respectively.
(b)The weighted average amortization period for acquired lease intangible liabilities is 17 years and five years for acquisitions completed during the nine months ended September 30, 2020 and 2019, respectively.
These acquisitions were funded using a combination of available cash on hand, proceeds from dispositions and proceeds from the Company’s unsecured revolving line of credit. All of the acquisitions completed during 2020 and 2019 were considered asset acquisitions and, as such, transaction costs were capitalized upon closing.
In addition, the Company capitalized $633 and $1,900 of internal salaries and related benefits of personnel directly involved in capital upgrades and tenant improvements during the three and nine months ended September 30, 2020, respectively, and $679 and $2,004 during the three and nine months ended September 30, 2019, respectively. The Company also capitalized internal leasing incentives of $66 and $168 during the three and nine months ended September 30, 2020, respectively, and $111 and $247 during the three and nine months ended September 30, 2019, respectively, all of which were incremental to signed leases.
Developments in Progress
The carrying amount of the Company’s developments in progress are as follows:
Property NameMSASeptember 30, 2020December 31, 2019
Expansion and redevelopment projects
Circle East (a)Baltimore$36,774 $33,628 
One Loudoun DowntownWashington, D.C.70,100 27,868 
CarillonWashington, D.C.33,086 26,407 
The Shoppes at QuarterfieldBaltimore2,003 — 
Pad development projects
Southlake Town SquareDallas952 — 
142,915 87,903 
Land held for future development
One Loudoun UptownWashington, D.C.25,450 25,450 
Total developments in progress$168,365 $113,353 
(a)During the year ended December 31, 2018, the Company received net proceeds of $11,820 in connection with the sale of air rights to a third party to develop multi-family rental units at Circle East, which is shown net in the “Developments in progress” balance as of September 30, 2020 and December 31, 2019 in the accompanying condensed consolidated balance sheets.
In response to current macroeconomic conditions related to the COVID-19 pandemic, the Company halted plans for vertical construction at its Carillon redevelopment during the three months ended March 31, 2020 and materially reduced the planned scope and spend for the project. As of September 30, 2020, the Company had completed the current scope of site work preparation at the property in anticipation of future vertical development at the site.
The Company capitalized $1,338 and $4,001 of indirect project costs related to redevelopment projects during the three and nine months ended September 30, 2020, including, among other costs, $318 and $1,019 of internal salaries and related benefits of personnel directly involved in the redevelopment projects and $804 and $2,325 of interest, respectively. The Company capitalized $1,204 and $2,437 of indirect project costs related to redevelopment projects during the three and nine months ended September 30, 2019, including, among other costs, $366 and $1,066 of internal salaries and related benefits of personnel directly involved in the redevelopment projects and $570 and $940 of interest, respectively.
Variable Interest Entities
As of January 1, 2020, the Company had joint ventures related to the development, ownership and operation of the (i) multi-family rental portion of the expansion project at One Loudoun Downtown – Pads G & H, of which joint venture the Company owned 90%; (ii) multi-family rental portion of the redevelopment project at Carillon, of which joint venture the Company owned 95%, and (iii) medical office building portion of the redevelopment project at Carillon, of which joint venture the Company owned 95%.
The joint ventures are considered VIEs primarily because the Company’s joint venture partners do not have substantive kick-out rights or substantive participating rights. The Company is considered the primary beneficiary as it has a controlling financial interest in each joint venture. As such, the Company has consolidated these joint ventures and presented the joint venture partners’ interests as noncontrolling interests.
As a result of halting the planned vertical construction at Carillon, the Company terminated (i) the joint venture related to the multi-family rental portion of the redevelopment during the three months ended March 31, 2020 and (ii) the joint venture related to the medical office building portion of the redevelopment during the three months ended June 30, 2020. In accordance with the terms of the joint venture agreements, costs incurred prior to the terminations were funded evenly by the partners and there was no payment between the partners upon termination. Subsequent to the terminations, if the Company commences the redevelopment and uses the materials developed, or approvals obtained, by the joint venture partners, the Company is required to reimburse the partners’ costs incurred in connection with such materials and/or approvals. As a result of the terminations, the Company reclassified the noncontrolling interest balance of $2,217 from noncontrolling interests to additional paid-in capital within equity. There was no gain or loss recognized in connection with the terminations.
As of September 30, 2020 and December 31, 2019, the Company recorded the following related to the consolidated joint ventures:
September 30, 2020December 31, 2019
One Loudoun Downtown –
Pads G & H		Carillon – Phase One
Multi-family Rental		Carillon – Phase One
Medical Office		TotalOne Loudoun Downtown –
Pads G & H		Carillon – Phase One
Multi-family Rental		Carillon – Phase One
Medical Office		Total
Net investment properties$59,678 $— $— $59,678 $8,830 $2,940 $675 $12,445 
Other assets, net$336 $— $— $336 $164 $— $— $164 
Other liabilities$7,361 $— $— $7,361 $1,546 $32 $129 $1,707 
Noncontrolling interests$4,507 $— $— $4,507 $1,869 $1,454 $273 $3,596 
During the three months ended September 30, 2020, the Company funded $758 of the partner’s development costs related to One Loudoun Downtown – Pads G & H through a loan provided by the Company to the joint venture. The loan is secured by the joint venture project, is required to be repaid subsequent to the completion of construction and stabilization of the project and is eliminated upon consolidation. Under terms defined in the joint venture agreement, after construction completion and stabilization of the development project, the Company has the ability to call, and the joint venture partner has the ability to put to the Company, subject to certain conditions, the joint venture partner’s interest in the joint venture at fair value. The Company has not provided financial support to the VIE in excess of any amounts that it is contractually required to provide. There was no income from the joint venture projects during the nine months ended September 30, 2020 and 2019 and, as such, no income was attributed to the noncontrolling interests.