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Rental Property
 9 Months Ended
Sep. 30, 2020
Real Estate [Abstract]  
Rental Property Rental Property
The following table summarizes the components of rental property as of September 30, 2020 and December 31, 2019.

Rental Property (in thousands)September 30, 2020December 31, 2019
Land$447,356 $435,923 
Buildings, net of accumulated depreciation of $311,326 and $254,458, respectively
2,862,026 2,787,234 
Tenant improvements, net of accumulated depreciation of $23,641 and $21,487, respectively
39,495 38,339 
Building and land improvements, net of accumulated depreciation of $138,402 and $111,688, respectively
243,807 232,456 
Construction in progress19,225 29,406 
Deferred leasing intangibles, net of accumulated amortization of $264,262 and $241,304, respectively
439,046 475,149 
Total rental property, net$4,050,955 $3,998,507 

Acquisitions

The following table summarizes the acquisitions of the Company during the three and nine months ended September 30, 2020.

Market (1)
Date AcquiredSquare FeetNumber of BuildingsPurchase Price
(in thousands)
Detroit, MIJanuary 10, 2020491,049 1 $29,543 
Rochester, NYJanuary 10, 2020124,850 1 8,565 
Minneapolis/St Paul, MNFebruary 6, 2020139,875 1 10,460 
Sacramento, CAFebruary 6, 2020160,534 1 18,468 
Richmond, VAFebruary 6, 202078,128 1 5,481 
Milwaukee/Madison, WIFebruary 7, 202081,230 1 7,219 
Detroit, MIFebruary 11, 2020311,123 1 23,141 
Philadelphia, PAMarch 9, 202078,000 1 6,571 
Tulsa, OKMarch 9, 2020134,600 1 9,895 
Three months ended March 31, 20201,599,389 9 119,343 
Sacramento, CAJune 11, 202054,463 1 5,730 
Chicago, ILJune 29, 202067,817 1 6,184 
Three months ended June 30, 2020122,280 2 11,914 
Philadelphia, PAAugust 31, 2020112,294 1 8,427 
Pittsburgh, PASeptember 3, 2020125,000 1 15,580 
Pittsburgh, PASeptember 24, 202066,387 1 6,685 
Charlotte, NCSeptember 28, 202050,000 1 5,729 
Cleveland, OHSeptember 29, 2020276,000 1 28,261 
Three months ended September 30, 2020629,681 5 64,682 
Nine months ended September 30, 20202,351,350 16 $195,939 
(1) As defined by CoStar Realty Information Inc (“CoStar”). If the building is located outside of a CoStar defined market, the city and state is reflected.
The following table summarizes the allocation of the consideration paid at the date of acquisition during the nine months ended September 30, 2020 for the acquired assets and liabilities in connection with the acquisitions identified in the table above.
Acquired Assets and LiabilitiesPurchase Price (in thousands)Weighted Average Amortization Period (years) of Intangibles at Acquisition
Land$15,338 N/A
Buildings135,570 N/A
Tenant improvements2,096 N/A
Building and land improvements8,895 N/A
Construction in progress669 N/A
Other assets450 N/A
Operating lease right-of-use assets2,321 N/A
Deferred leasing intangibles - In-place leases21,496 8.0
Deferred leasing intangibles - Tenant relationships10,150 11.1
Deferred leasing intangibles - Above market leases3,962 12.6
Deferred leasing intangibles - Below market leases(2,687)5.3
Operating lease liabilities(2,321)N/A
Total purchase price$195,939  

The following table summarizes the results of operations for the three and nine months ended September 30, 2020 for the buildings acquired during the nine months ended September 30, 2020 included in the Company’s Consolidated Statements of Operations from the date of acquisition.

Results of Operations (in thousands)Three months ended September 30, 2020Nine months ended September 30, 2020
Total revenue$3,298 $8,046 
Net income$601 $1,462 

Dispositions

During the nine months ended September 30, 2020, the Company sold five buildings to third parties comprised of approximately 1.7 million rentable square feet with a net book value of approximately $64.4 million. These buildings contributed approximately $0.1 million, $0.8 million, $1.3 million and $4.5 million to revenue for the three and nine months ended September 30, 2020 and 2019, respectively. These buildings contributed approximately $(0.3) million, $(0.4) million, $(0.2) million and $0.3 million to net income (loss) (exclusive of gain on the sales of rental property, net and loss on extinguishment of debt) for the three and nine months ended September 30, 2020 and 2019, respectively. Net proceeds from the sales of rental property were approximately $121.3 million and the Company recognized the full gain on the sales of rental property, net, of approximately $56.9 million for the nine months ended September 30, 2020.

Loss on Impairments

The following table summarizes the Company’s loss on impairments for assets held and used during the nine months ended September 30, 2020.
Market(1)
Number of Buildings
Event or Change in Circumstance Leading to Impairment Evaluation(2)
Valuation technique utilized to estimate fair value
Fair Value(3)
Loss on Impairments
(in thousands)
Williamsport, PA1Change in estimated hold periodDiscounted cash flows(4)
Three months ended September 30, 2020$5,019 $3,172 
Nine months ended September 30, 2020$5,019 $3,172 

(1)As defined by CoStar. If the building is located outside of a CoStar defined market, the city and state is reflected.
(2)The Company tested the asset group for impairment utilizing a recovery analysis, and it was determined that the carrying value of the property and intangibles were not recoverable from the estimated future undiscounted cash flows.
(3)The estimated fair value of the property is based on Level 3 inputs and is a non-recurring fair value measurement. Level 3 is defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.
(4)Level 3 inputs used to determine fair value for the property impaired for the three months ended September 30, 2020: discount rate of 10.5% and exit capitalization rate of 10.0%.

During the three and nine months ended September 30, 2019, the Company recognized approximately $4.4 million and $9.8 million, respectively, of loss on impairments related to six buildings.
Gain on Involuntary Conversion

During the three and nine months ended September 30, 2020, the Company recognized a gain on involuntary conversion of approximately $1.5 million and $2.2 million, respectively, related to an eminent domain taking of a portion of a parcel of land. During the three and nine months ended September 30, 2019, the Company did not recognize any gain on involuntary conversion.

Deferred Leasing Intangibles

The following table summarizes the deferred leasing intangibles on the accompanying Consolidated Balance Sheets as of September 30, 2020 and December 31, 2019.

September 30, 2020December 31, 2019
Deferred Leasing Intangibles (in thousands)GrossAccumulated AmortizationNetGrossAccumulated AmortizationNet
Above market leases$93,002 $(36,711)$56,291 $92,607 $(32,115)$60,492 
Other intangible lease assets610,306 (227,551)382,755 623,846 (209,189)414,657 
Total deferred leasing intangible assets$703,308 $(264,262)$439,046 $716,453 $(241,304)$475,149 
Below market leases$39,167 $(14,176)$24,991 $38,802 $(12,064)$26,738 
Total deferred leasing intangible liabilities$39,167 $(14,176)$24,991 $38,802 $(12,064)$26,738 

The following table summarizes the amortization expense and the net decrease to rental income for the amortization of deferred leasing intangibles during the three and nine months ended September 30, 2020 and 2019.

 Three months ended September 30,Nine months ended September 30,
Deferred Leasing Intangibles Amortization (in thousands)2020201920202019
Net decrease to rental income related to above and below market lease amortization$1,482 $1,248 $3,646 $3,361 
Amortization expense related to other intangible lease assets$21,780 $18,472 $63,158 $53,185 

The following table summarizes the amortization of deferred leasing intangibles over the next five calendar years beginning with 2020 as of September 30, 2020.

YearAmortization Expense Related to Other Intangible Lease Assets (in thousands)Net Decrease to Rental Income Related to Above and Below Market Lease Amortization (in thousands)
Remainder of 2020$18,290 $859 
2021$65,614 $2,764 
2022$56,254 $2,298 
2023$47,759 $2,504 
2024$38,947 $2,812