Segments (Tables)

9 Months Ended

Sep. 30, 2023

Schedule of Net Operating Income of Reportable Segments

The following table presents NOI for the Company's five reportable segments for the three and nine months ended September 30, 2023 and 2022 (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Retail real estate
Rental revenues	$	25,858	$	21,223	$	73,004	$	64,197
Rental expenses	4,125		3,420		11,715		10,254
Real estate taxes	2,312		2,206		6,789		6,715
Segment net operating income	19,421		15,597		54,500		47,228
Office real estate
Rental revenues	22,077		18,687		62,156		54,024
Rental expenses	5,925		4,886		16,282		13,626
Real estate taxes	2,262		2,044		6,524		5,583
Segment net operating income	13,890		11,757		39,350		34,815
Multifamily real estate
Rental revenues	14,978		13,833		43,922		45,381
Rental expenses	4,706		4,441		13,395		14,221
Real estate taxes	1,293		1,204		3,597		4,397
Segment net operating income	8,979		8,188		26,930		26,763
General contracting and real estate services
General contracting and real estate services revenues	99,408		69,024		286,220		138,947
General contracting and real estate services expenses	96,095		66,252		276,336		133,491
Segment gross profit	3,313		2,772		9,884		5,456
Real estate financing
Interest income	3,496		3,372		10,257		10,070
Interest expense(a)	728		840		2,634		2,482
Segment gross profit	2,768		2,532		7,623		7,588
Net operating income	$	48,371	$	40,846	$	138,287	$	121,850

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(a) Interest expense within the real estate financing segment is allocated based on the average outstanding principal of notes receivable in the real estate financing portfolio, and the effective interest rate on the credit facility, as defined in Note 8.

Schedule of Reconciliation of Net Income

The following table reconciles NOI to net income, the most directly comparable GAAP measure, for the three and nine months ended September 30, 2023 and 2022 (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net operating income	$	48,371	$	40,846	$	138,287	$	121,850
Interest income(a)	194		118		566		340
Depreciation and amortization	(22,462)		(17,527)		(60,808)		(54,865)
Amortization of right-of-use assets - finance leases	(425)		(278)		(1,049)		(833)
General and administrative expenses	(4,286)		(3,854)		(13,786)		(12,179)
Acquisition, development, and other pursuit costs	—		—		(18)		(37)
Impairment charges	(5)		—		(107)		(333)
Gain on real estate dispositions, net	227		33,931		738		53,424
Interest expense(b)	(14,716)		(9,505)		(38,741)		(26,265)

Loss on extinguishment of debt	—		(2,123)		—		(2,899)
Change in fair value of derivatives and other	2,466		782		5,024		7,512
Unrealized credit loss (provision) release	(694)		42		(871)		(858)
Other income (expense), net	63		118		324		415
Income tax (provision) benefit	(310)		(181)		(834)		140
Net income	$	8,423	$	42,369	$	28,725	$	85,412

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(a) Excludes real estate financing segment interest income of $3.5 million and $3.4 million for the three months ended September 30, 2023 and 2022, respectively, and $10.3 million and $10.1 million for the nine months ended September 30, 2023 and 2022, respectively.

(b) Excludes real estate financing segment interest expense of $0.7 million and $0.8 million for the three months ended September 30, 2023 and 2022, respectively, and $2.6 million and $2.5 million for the nine months ended September 30, 2023 and 2022, respectively.