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Equity in Earnings of Unconsolidated Real Estate Ventures - Gain on Sale of Real Estate and Purchase of Joint Venture Partners' Interests
9 Months Ended
Sep. 30, 2016
Equity Method Investments and Joint Ventures [Abstract]  
Equity in Earnings of Unconsolidated Real Estate Ventures - Gain on Sale of Real Estate and Purchase of Joint Venture Partners' Interests
INVESTMENTS IN UNCONSOLIDATED REAL ESTATE VENTURES

On September 16, 2016, subsequent to its acquisition of 23 properties as outlined in Note 5, the Company sold its 4.42% interest in PRISA II to Prudential for $34,758 in cash. The carrying value of the Company's investment prior to the acquisition was $3,912, and the Company recorded a gain on the sale of $30,846. This gain is included in equity in earnings of unconsolidated real estate ventures - gain on sale of real estate assets and purchase of joint venture partners' interests on the Company's condensed consolidated statements of operations.

On September 14, 2016, the Company entered into a new joint venture, ESS-GS Vancouver-139th LLC ("Vancouver"). Vancouver purchased a newly constructed store located in Oregon for a purchase price of $8,700, which was financed through debt and member contributions. The Company contributed a total of $806 for a 25.0% interest in Vancouver. The Company accounts for its investment in Vancouver under the equity method of accounting.

On August 16, 2016, the Company entered into a new joint venture, ESS-H Elmont Associates LLC ("Elmont"). Elmont purchased a newly constructed store located in New York for a purchase price of $24,700, which was financed through debt and member contributions. The Company contributed a total of $4,712 for a 50.0% interest in Elmont. The Company accounts for its investment in Elmont under the equity method of accounting.

On July 8, 2016, the Company entered into a new joint venture, ESS-GS Hillsboro-73rd LLC ("Hillsboro"). Hillsboro purchased a newly constructed store located in Oregon for a purchase price of $3,672, which was financed through debt and member contributions. The Company contributed a total of $376 for a 25.0% interest in Hillsboro. The Company accounts for its investment in Hillsboro under the equity method of accounting.

On May 20, 2016, the Company entered into a new joint venture, BH Storage Columbia LLC ("BH"). BH purchased a newly constructed store located in South Carolina for a purchase price of $8,000, which was financed through debt and member contributions. The Company contributed a total of $1,034 for a 20.0% interest in BH. The Company accounts for its investment in BH under the equity method of accounting.

On April 25, 2016, the Company and Prudential entered into the “Second Amendment to Amended and Restated Operating Agreement of ESS PRISA LLC” and the “First Amendment to Amended and Restated Operating Agreement of ESS PRISA II LLC” (the “Amendments”). The Amendments are deemed effective as of April 1, 2016. Under the Amendments, the Company gave up any future rights to receive distributions from these joint ventures at the higher “excess profit participation” percentage of 17.0% in exchange for a higher equity ownership percentage. The Company’s equity ownership in ESS PRISA LLC increased from 2.0% to 4.0%, and the Company’s equity ownership in ESS PRISA II LLC increased from 2.0% to 4.4%. The Company continues to account for its investment in these joint ventures under the equity method of accounting.

On April 8, 2016, the Company entered into a new joint venture, PR EXR Self Storage, LLC ("PREXR"). PREXR purchased a single store located in New York for a purchase price of $52,000, which was financed through member contributions. The Company contributed a total of $12,114 for a 25.0% interest in PREXR. The Company accounts for its investment in PREXR under the equity method of accounting.

On March 31, 2016, the Company entered into a new joint venture, ESS-H Baychester Investments LLC (“Baychester”). Baychester purchased a single store in New York for $23,000, which was financed through debt and member contributions. The Company contributed $4,794 for a 44.4% interest in Baychester. The Company accounts for its investment in Baychester under the equity method of accounting.
EQUITY IN EARNINGS OF UNCONSOLIDATED REAL ESTATE VENTURES—GAIN ON SALE OF REAL ESTATE AND PURCHASE OF JOINT VENTURE PARTNERS’ INTERESTS

On September 16, 2016, the Company acquired 23 operating stores from PRISA II in a step acquisition. The Company recognized a non-cash gain of $6,662 related to this transaction as a result of revaluing its existing equity interest upon the purchase of the remaining interest. See Note 5 for more information on this transaction.

On September 16, 2016, subsequent to its acquisition of 23 properties as outlined in Note 5, the Company sold its 4.42% interest in PRISA II to Prudential for $34,758 in cash. The carrying value of the Company's investment prior to the acquisition was $3,912, and the Company recorded a gain on the sale of $30,846. This gain is included in equity in earnings of unconsolidated real estate ventures - gain on sale of real estate assets and purchase of joint venture partners' interests on the Company's condensed consolidated statements of operations.

On February 2, 2016, the Company acquired six operating stores from VRS in a step acquisition. The Company recognized a non-cash gain of $26,923 related to this transaction as a result of revaluing its existing equity interest upon the purchase of the remaining interest. See Note 5 for more information on this transaction.

In March 2015, ESS PRISA II LLC (“PRISA II”), a joint venture in which the Company held a 2.0% interest, sold one store located in New York for $90,000. As a result of the sale, PRISA II recognized a gain of $60,496 and the Company recorded its 2.0% portion of the gain, or $1,228.

In March 2015, the Company acquired its joint venture partner’s 82.4% interest in Sacramento One, an existing joint venture which owned one store located in California, for $1,700. In addition, the Company held mortgage notes receivable from Sacramento One totaling $11,009, which were written off as part of the total consideration. Prior to the acquisition, the remaining 17.6% interest was owned by the Company, which accounted for its investment in Sacramento One using the equity method. The Company recorded a non-cash gain of $1,629 related to this transaction, which represents the increase in fair value of the Company’s interest in the joint venture from its formation to the acquisition date.