Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share (in thousands, except share and per share amounts):



	Three Months Ended March 31,
	2017			2016
Numerator:
Net income	$	5,721		$	1,477
Less: Preferred stock dividends	(1,322		)	—
Less: Net income attributable to noncontrolling interests	(132		)	(52		)
Less: Net income attributable to participating securities	(91		)	(78		)
Net income attributable to common stockholders	$	4,176		$	1,347

Denominator:
Weighted average shares of common stock outstanding – basic	66,341,138			55,269,598
Effect of dilutive securities - performance units	285,101			147,349
Weighted average shares of common stock outstanding – diluted	66,626,239			55,416,947

Earnings per share — Basic
Net income attributable to common stockholders	$	0.06		$	0.02
Earnings per share — Diluted
Net income attributable to common stockholders	$	0.06		$	0.02

Unvested share-based payment awards that contain non-forfeitable rights to dividends, whether paid or unpaid, are accounted for as participating securities. As such, unvested shares of restricted stock, unvested LTIP Units and unvested Performance Units are considered participating securities. Participating securities are included in the computation of basic EPS pursuant to the two-class method. The two-class method determines EPS for each class of common stock and each participating security according to dividends declared (or accumulated) and their respective participation rights in undistributed earnings. Participating securities are also included in the computation of diluted EPS using the more dilutive of the two-class method or treasury stock method for unvested shares of restricted stock and LTIP Units, and by determining if certain market conditions have been met at the reporting date for unvested Performance Units.

The effect of including unvested shares of restricted stock and unvested LTIP Units using the treasury stock method was excluded from our calculation of weighted average shares of common stock outstanding – diluted, as their inclusion would have been anti-dilutive.

Performance Units, which are subject to vesting based on the Company outperforming certain absolute and relative TSR levels over a three-year performance period, are included as contingently issuable shares in the calculation of diluted EPS when TSR has been achieved at or above the threshold levels specified in the award agreements, assuming the reporting period is the end of the performance period, and the effect is dilutive. As of March 31, 2017, for the performance awards granted in 2015, the Company’s TSR performance relative to a peer group was above the 75th percentile, or maximum level, and the Company’s absolute TSR was between the target and maximum levels. As of March 31, 2017, for the performance awards granted in 2016, the Company’s absolute and relative TSR were both below the threshold level. The corresponding number of dilutive securities have been included in the computation of the weighted average diluted shares above, since they were more dilutive than using the two-class method of computing EPS.

We also consider the effect of other potentially dilutive securities, including OP Units, which may be redeemed for shares of our common stock under certain circumstances, and include them in our computation of diluted EPS when their inclusion is dilutive.