QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction |
(I.R.S. Employer | |
of incorporation or organization) |
Identification No.) |
Title of Each Class |
Trading Symbol(s) |
Name of each Exchange on Which Registered | ||
“ “ |
Large accelerated filer | ☐ | ☒ | ||||
Non-accelerated filer |
☐ | Smaller reporting company | ||||
Emerging growth company |
1 |
||||
1 |
||||
1 |
||||
2 |
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3 |
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4 |
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5 |
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6 |
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16 |
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26 |
||||
26 |
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27 |
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27 |
||||
27 |
||||
27 |
||||
28 |
||||
28 |
||||
28 |
||||
29 |
||||
30 |
June 30, 2022 |
December 31, 2021 |
|||||||
Assets |
||||||||
Real estate properties |
||||||||
Land |
$ | $ | ||||||
Building and improvement |
||||||||
Tenant improvement |
||||||||
Furniture, fixtures and equipment |
||||||||
|
|
|
|
|||||
Accumulated depreciation |
( |
) | ( |
) | ||||
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|
|||||
|
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|
|||||
Cash and cash equivalents |
||||||||
Restricted cash |
||||||||
Rents receivable, net |
||||||||
Deferred leasing costs, net |
||||||||
Acquired lease intangible assets, net |
||||||||
Other assets |
||||||||
|
|
|
|
|||||
Total Assets |
$ | $ | ||||||
|
|
|
|
|||||
Liabilities and Equity |
||||||||
Liabilities: |
||||||||
Debt |
$ | $ | ||||||
Accounts payable and accrued liabilities |
||||||||
Deferred rent |
||||||||
Tenant rent deposits |
||||||||
Acquired lease intangible liabilities, net |
||||||||
Other liabilities |
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|
|
|||||
Total Liabilities |
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|
|||||
Commitments and Contingencies (Note 9) |
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Equity: |
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|
||||||||
Common stock, $ |
||||||||
Additional paid-in capital |
||||||||
Retained earnings |
||||||||
Accumulated other comprehensive income/(loss) |
( |
) | ||||||
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|
|
|
|||||
Total Stockholders’ Equity |
||||||||
Non-controlling interests in properties |
||||||||
|
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|
|
|||||
Total Equity |
||||||||
|
|
|
|
|||||
Total Liabilities and Equity |
$ | $ | ||||||
|
|
|
|
|||||
Subsequent Events (Note 11) |
Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Rental and other revenues |
$ | $ | $ | $ | ||||||||||||
Operating expenses: |
||||||||||||||||
Property operating expenses |
||||||||||||||||
General and administrative |
||||||||||||||||
Depreciation and amortization |
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|
|||||||||
Total operating expenses |
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|
|||||||||
Operating income |
||||||||||||||||
Interest expense: |
||||||||||||||||
Contractual interest expense |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Amortization of deferred financing costs and debt fair value |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
( |
) | ( |
) | ( |
) | ( |
) | |||||||||
Net gain on sale of real estate property |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income |
||||||||||||||||
Less: |
||||||||||||||||
Net income attributable to non-controlling interests in properties |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
|
|
|
|
|
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|
|||||||||
Net income attributable to the Company |
||||||||||||||||
Preferred stock distributions |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income/(loss) attributable to common stockholders |
$ | $ | ( |
) | $ | $ | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income/(loss) per common share: |
||||||||||||||||
Basic |
$ | $ | $ | $ | ||||||||||||
|
|
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|
|
|
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|
|||||||||
Diluted |
$ | $ | $ | $ | ||||||||||||
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|
|||||||||
Weighted average common shares outstanding: |
||||||||||||||||
Basic |
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|||||||||
Diluted |
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|
|||||||||
Dividend distributions declared per common share |
$ | $ | $ | $ | ||||||||||||
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Net income |
$ | $ | $ | $ | ||||||||||||
Other comprehensive income: |
||||||||||||||||
Unrealized cash flow hedge gain/(loss) |
( |
) | ||||||||||||||
Amounts reclassified to interest expense |
||||||||||||||||
|
|
|
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|
|
|
|
|||||||||
Other comprehensive income |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Comprehensive income |
||||||||||||||||
Less: |
||||||||||||||||
Comprehensive income attributable to non-controlling interests in properties |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Comprehensive income attributable to the Company |
$ | $ | $ | $ | ||||||||||||
|
|
|
|
|
|
|
|
Number of shares of preferred stock |
Preferred stock |
Number of shares of common stock |
Common stock |
Additional paid-in capital |
Retained earnings |
Accumulated other comprehensive (loss)/income |
Total stockholders’ equity |
Non-controlling interests in properties |
Total equity |
|||||||||||||||||||||||||||||||
Balance—December 31, 2021 |
$ | $ | $ | $ | $ | ( |
) | $ | $ | $ | ||||||||||||||||||||||||||||||
Restricted stock award grants and vesting |
— | — | — | — | ( |
) | — | — | ||||||||||||||||||||||||||||||||
Common stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Preferred stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Contributions |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Distributions |
— | — | — | — | — | — | — | — | ( |
) | ( |
) | ||||||||||||||||||||||||||||
Net income |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Other comprehensive income |
— | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance—March 31, 2022 |
$ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Restricted stock award grants and vesting |
— | — | ( |
) | — | — | ||||||||||||||||||||||||||||||||||
Common stock repurchased |
— | — | ( |
) | ( |
) | ( |
) | — | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||
Common stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Preferred stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Distributions |
— | — | — | — | — | — | — | — | ( |
) | ( |
) | ||||||||||||||||||||||||||||
Net income |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Other comprehensive income |
— | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance—June 30, 2022 |
$ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of shares of preferred stock |
Preferred stock |
Number of shares of common stock |
Common stock |
Additional paid-in capital |
Accumulated deficit |
Accumulated other comprehensive loss |
Total stockholders’ equity |
Non-controlling interests in properties |
Total equity |
|||||||||||||||||||||||||||||||
Balance—December 31, 2020 |
$ | $ | $ | $ | ( |
) | $ | ( |
) | $ | $ | $ | ||||||||||||||||||||||||||||
Restricted stock award grants and vesting |
— | — | — | — | ( |
) | — | — | ||||||||||||||||||||||||||||||||
Common stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Preferred stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Distributions |
— | — | — | — | — | — | — | — | ( |
) | ( |
) | ||||||||||||||||||||||||||||
Net income |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Other comprehensive income |
— | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance—March 31, 2021 |
$ | $ | $ | $ |
( |
) | $ | ( |
) | $ | $ | $ | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Restricted stock award grants and vesting |
— | — | ( |
) | — | — | ||||||||||||||||||||||||||||||||||
Common stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Preferred stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Contributions |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Distributions |
— | — | — | — | — | — | — | — | ( |
) | ( |
) | ||||||||||||||||||||||||||||
Net income |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Other comprehensive income |
— | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance—June 30, 2021 |
$ | $ | $ | $ |
( |
) | $ | ( |
) | $ | $ | $ | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, |
||||||||
2022 |
2021 |
|||||||
Cash Flows from Operating Activities: |
||||||||
Net income |
$ | $ | ||||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||
Depreciation and amortization |
||||||||
Amortization of deferred financing costs and debt fair value |
||||||||
Amortization of above and below market leases |
||||||||
Straight-line rent/expense |
( |
) | ||||||
Non-cash stock compensation |
||||||||
Receipts from sales-type lease |
||||||||
Net gain on sale of real estate property |
( |
) | ( |
) | ||||
Changes in non-cash working capital: |
||||||||
Rents receivable, net |
( |
) | ||||||
Other assets |
( |
) | ( |
) | ||||
Accounts payable and accrued liabilities |
( |
) | ||||||
Deferred rent |
( |
) | ||||||
Tenant rent deposits |
||||||||
|
|
|
|
|||||
Net Cash Provided By Operating Activities |
||||||||
|
|
|
|
|||||
Cash Flows (to)/from Investing Activities: |
||||||||
Additions to real estate properties |
( |
) | ( |
) | ||||
Acquisition of real estate |
( |
) | ||||||
Net proceeds from sale of real estate |
||||||||
Deferred leasing costs |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Net Cash (Used In)/Provided By Investing Activities |
( |
) | ||||||
|
|
|
|
|||||
Cash Flows to Financing Activities: |
||||||||
Proceeds from borrowings |
||||||||
Repayment of borrowings |
( |
) | ( |
) | ||||
Dividend distributions paid to stockholders |
( |
) | ( |
) | ||||
Repurchases of common stock |
( |
) | ||||||
Distributions to non-controlling interests in properties |
( |
) | ( |
) | ||||
Shares withheld for payment of taxes on restricted stock unit vesting |
( |
) | ( |
) | ||||
Contributions from non-controlling interests in properties |
||||||||
|
|
|
|
|||||
Net Cash Used In Financing Activities |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Net Increase/(Decrease) in Cash, Cash Equivalents and Restricted Cash |
( |
) | ||||||
Cash, Cash Equivalents and Restricted Cash, Beginning of Period |
||||||||
|
|
|
|
|||||
Cash, Cash Equivalents and Restricted Cash, End of Period |
$ | $ | ||||||
|
|
|
|
|||||
Reconciliation of Cash, Cash Equivalents and Restricted Cash: |
||||||||
Cash and Cash Equivalents, End of Period |
||||||||
Restricted Cash, End of Period |
||||||||
|
|
|
|
|||||
Cash, Cash Equivalents and Restricted Cash, End of Period |
$ | $ | ||||||
|
|
|
|
|||||
Supplemental Disclosures of Cash Flow Information: |
||||||||
Cash paid for interest |
$ | $ | ||||||
Purchase of additions in real estate properties included in accounts payable |
$ | $ | ||||||
Purchase of deferred leasing costs included in accounts payable |
$ | $ |
Property |
Date Acquired |
Percentage Owned |
||||||
5910 Pacific Center and 9985 Pacific Heights |
% |
5910 Pacific Center and 9985 Pacific Heights |
||||
Land |
$ | |
||
Building and improvement |
||||
Tenant improvement |
||||
Lease intangible assets |
||||
Other assets |
||||
Accounts payable and other liabilities |
( |
) | ||
Lease intangible liabilities |
( |
) | ||
|
|
|||
Net assets acquired |
$ | |||
|
|
Lease Intangible Assets |
Lease Intangible Liabilities |
|||||||||||||||||||||||||||
June 30, 2022 |
Above Market Leases |
In Place Leases |
Leasing Commissions |
Total |
Below Market Leases |
Below Market Ground Lease |
Total |
|||||||||||||||||||||
Cost |
$ | |
$ | $ | $ | |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||||||||||||
Accumulated amortization |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||
$ | $ | $ | $ | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||||||||||||||
Lease Intangible Assets |
Lease Intangible Liabilities |
|||||||||||||||||||||||||||
December 31, 2021 |
Above Market Leases |
In Place Leases |
Leasing Commissions |
Total |
Below Market Leases |
Below Market Ground Lease |
Total |
|||||||||||||||||||||
Cost |
$ | $ | $ | $ | $ | ( |
) | $ | ( |
) | $ | ( |
) | |||||||||||||||
Accumulated amortization |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||
$ | $ | $ | $ | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||||||||||||||
2022 |
$ | |||
2023 |
||||
2024 |
||||
2025 |
||||
2026 |
||||
Thereafter |
||||
$ | ||||
Property |
June 30, 2022 |
December 31, 2021 |
Interest Rate as of June 30, 2022 (1) |
Maturity | ||||||||||
Unsecured Credit Facility (3)(4) |
$ | |
$ | |
% (2) |
|||||||||
Term Loan (3) |
% (2) |
|||||||||||||
Mission City |
% | |||||||||||||
Canyon Park (5) |
% | |||||||||||||
Circle Point |
% | |||||||||||||
190 Office Center |
% | |||||||||||||
SanTan |
% | |||||||||||||
Intellicenter |
% | |||||||||||||
The Quad |
% | |||||||||||||
FRP Collection |
% | |||||||||||||
2525 McKinnon |
% | |||||||||||||
Greenwood Blvd |
% | |||||||||||||
Cascade Station |
% | |||||||||||||
5090 N. 40 th |
% | |||||||||||||
AmberGlen |
% |
Property |
June 30, 2022 |
December 31, 2021 |
Interest Rate as of June 30, 2022 (1) |
Maturity | ||||||||||
Central Fairwinds |
% | |||||||||||||
FRP Ingenuity Drive |
% | |||||||||||||
Carillon Point |
% | |||||||||||||
Lake Vista Pointe (6) |
— | — | ||||||||||||
Total Principal |
||||||||||||||
Deferred financing costs, net |
( |
) | ( |
) | ||||||||||
Unamortized fair value adjustments |
||||||||||||||
Total |
$ | $ | ||||||||||||
(1) | All interest rates are fixed interest rates with the exception of the Unsecured Credit Facility (the “Unsecured Credit Facility”) and the Term Loan (as defined herein), as explained in footnotes 3 and 4 below. |
(2) | As of June 30, 2022, the one-month LIBOR rate was |
(3) | In September 2019, the Company entered into a five-year $ 30-day LIBOR payments. |
(4) | In March 2018, the Company entered into the Credit Agreement for the Unsecured Credit Facility that provides for commitments of up to $ June 30 , 2022, the Unsecured Credit Facility had $ |
(5) | The mortgage loan anticipated repayment date (“ARD”) is March 1, 2027. The final scheduled maturity date can be extended up to 5 years beyond the ARD. If the loan is not paid off at ARD, the loan’s interest rate shall be adjusted to the greater of (i) the initial interest rate plus basis points or (ii) the yield on the five year “on the run” treasury reported by Bloomberg market data service plus basis points. |
(6) | In June 2022, the loan balance of $ |
2022 |
$ | |||
2023 |
||||
2024 |
||||
2025 |
||||
2026 |
||||
Thereafter |
||||
$ | ||||
Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Fixed payments |
$ | |
$ | |
$ | |
$ | |
||||||||
Variable payments |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | |
$ | $ | $ | ||||||||||||
|
|
|
|
|
|
|
|
2022 |
$ | |||
2023 |
||||
2024 |
||||
2025 |
||||
2026 |
||||
Thereafter |
||||
|
|
|||
$ | ||||
|
|
June 30, 2022 |
December 31, 2021 |
|||||||
Right-of-use |
$ | $ | ||||||
Lease liability – operating leases |
$ | $ | ||||||
Right-of-use |
$ | $ | ||||||
Lease liability – financing leases |
$ | $ |
Operating Leases |
Financing Leases |
|||||||
2022 |
$ | $ | ||||||
2023 |
||||||||
2024 |
||||||||
2025 |
||||||||
2026 |
||||||||
Thereafter |
||||||||
|
|
|
|
|||||
Total future minimum lease payments |
||||||||
Discount |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Total |
$ | $ | ||||||
|
|
|
|
Number of RSUs |
Number of Performance RSUs |
|||||||
Outstanding at December 31, 2021 |
||||||||
Granted |
||||||||
Issuance of dividend equivalents |
||||||||
Vested |
||||||||
Forfeited |
||||||||
|
|
|
|
|||||
Outstanding at March 31, 2022 |
||||||||
Granted |
||||||||
Issuance of dividend equivalents |
||||||||
Vested |
( |
) | ||||||
Forfeited |
||||||||
|
|
|
|
|||||
Outstanding at June 30, 2022 |
Number of RSUs |
Number of Performance RSUs |
|||||||
Outstanding at December 31, 2020 |
||||||||
Granted |
||||||||
Issuance of dividend equivalents |
||||||||
Vested |
||||||||
Forfeited |
||||||||
|
|
|
|
|||||
Outstanding at March 31, 2021 |
||||||||
Granted |
||||||||
Issuance of dividend equivalents |
||||||||
Vested |
( |
) | ||||||
Forfeited |
||||||||
|
|
|
|
|||||
Outstanding at June 30, 2021 |
Units Granted |
Fair Value (in thousands) |
Weighted Average Grant Fair Value Per Share |
||||||||||||||
RSUs |
Performance RSUs |
|||||||||||||||
2021 |
$ | |
$ | |||||||||||||
2022 |
RSUs |
Performance RSUs |
Total |
||||||||||
2021 |
$ | $ | $ | |||||||||
2022 |
RSUs |
Performance RSUs |
Total |
||||||||||
2021 |
$ | $ | $ | |
||||||||
2022 |
• | adverse economic or real estate developments in the office sector or the markets in which we operate; |
• | changes in local, regional, national and international economic conditions, including as a result of the ongoing coronavirus disease (“COVID-19”) pandemic; |
• | requests from tenants for rent deferrals, rent abatement or relief from other contractual obligations, or a failure to pay rent, as a result of changes in business behavior stemming from the ongoing COVID-19 pandemic or the availability of government assistance programs; |
• | our inability to compete effectively; |
• | our inability to collect rent from tenants or renew tenants’ leases on attractive terms if at all; |
• | demand for and market acceptance of our properties for rental purposes, including as a result of near-term market fluctuations or long-term trends that result in an overall decrease in the demand for office space; |
• | defaults on or non-renewal of leases by tenants, including as a result of the ongoing COVID-19 pandemic; |
• | increased interest rates, any resulting increase in financing or operating costs and the impact of inflation; |
• | decreased rental rates or increased vacancy rates, including as a result of the ongoing COVID-19 pandemic; |
• | our failure to obtain necessary financing or access the capital markets on favorable terms or at all; |
• | changes in the availability of acquisition opportunities; |
• | availability of qualified personnel; |
• | our inability to successfully complete real estate acquisitions or dispositions on the terms and timing we expect, or at all; |
• | our failure to successfully operate acquired properties and operations; |
• | changes in our business, financing or investment strategy or the markets in which we operate; |
• | our failure to generate sufficient cash flows to service our outstanding indebtedness; |
• | environmental uncertainties and risks related to adverse weather conditions and natural disasters; |
• | our failure to maintain our qualification as a REIT for U.S. federal income tax purposes; |
• | government approvals, actions and initiatives, including the need for compliance with environmental requirements, vaccine mandates or actions in response to the COVID-19 pandemic; |
• | outcome of claims and litigation involving or affecting us; |
• | financial market fluctuations; |
• | changes in real estate, taxation and zoning laws and other legislation and government activity and changes to real property tax rates and the taxation of REITs in general; and |
• | other factors described in our news releases and filings with the SEC, including but not limited to those described in our Annual Report on Form 10-K for the year ended December 31, 2021 under the sections captioned “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business” and in our subsequent reports filed with the SEC. |
Metropolitan Area |
Property |
Economic Interest |
NRA (000s Square Feet) |
In Place Occupancy |
Annualized Base Rent per Square Foot |
Annualized Gross Rent per Square Foot (1) |
Annualized Base Rent (2) ($000s) |
|||||||||||||||||||
Phoenix, AZ |
Block 23 | 100.0 | % | 307 | 94.0 | % | $ | 29.63 | $ | 31.88 | $ | 8,552 | ||||||||||||||
Pima Center | 100.0 | % | 272 | 63.9 | % | $ | 28.63 | $ | 28.63 | $ | 4,976 | |||||||||||||||
SanTan | 100.0 | % | 267 | 96.5 | % | $ | 30.10 | $ | 30.10 | $ | 7,746 | |||||||||||||||
5090 N. 40 th St |
100.0 | % | 176 | 95.4 | % | $ | 31.88 | $ | 31.88 | $ | 5,335 | |||||||||||||||
Camelback Square | 100.0 | % | 172 | 69.9 | % | $ | 33.56 | $ | 33.56 | $ | 4,026 | |||||||||||||||
The Quad | 100.0 | % | 163 | 100.0 | % | $ | 31.15 | $ | 31.46 | $ | 5,078 | |||||||||||||||
Papago Tech | 100.0 | % | 163 | 86.1 | % | $ | 23.39 | $ | 23.39 | $ | 3,277 | |||||||||||||||
Tampa, FL |
Park Tower | 94.8 | % | 478 | 86.4 | % | $ | 27.27 | $ | 27.27 | $ | 11,253 | ||||||||||||||
City Center | 95.0 | % | 245 | 85.0 | % | $ | 27.84 | $ | 27.84 | $ | 5,791 | |||||||||||||||
Intellicenter | 100.0 | % | 204 | 100.0 | % | $ | 25.64 | $ | 25.64 | $ | 5,219 | |||||||||||||||
Carillon Point | 100.0 | % | 124 | 100.0 | % | $ | 29.52 | $ | 29.52 | $ | 3,666 | |||||||||||||||
Denver, CO |
Denver Tech | 100.0 | % | 381 | 93.2 | % | $ | 23.98 | $ | 28.08 | $ | 8,425 | ||||||||||||||
Circle Point | 100.0 | % | 272 | 75.4 | % | $ | 19.42 | $ | 33.28 | $ | 3,984 | |||||||||||||||
Superior Pointe | 100.0 | % | 152 | 91.3 | % | $ | 18.77 | $ | 31.77 | $ | 2,609 | |||||||||||||||
Orlando, FL |
Florida Research Park | 96.5 | % | 393 | 80.7 | % | $ | 25.37 | $ | 27.34 | $ | 7,973 | ||||||||||||||
Central Fairwinds | 97.0 | % | 168 | 94.6 | % | $ | 27.26 | $ | 27.26 | $ | 4,337 | |||||||||||||||
Greenwood Blvd | 100.0 | % | 155 | 100.0 | % | $ | 24.25 | $ | 24.25 | $ | 3,760 | |||||||||||||||
Dallas, TX |
190 Office Center | 100.0 | % | 303 | 75.5 | % | $ | 27.11 | $ | 27.11 | $ | 6,210 | ||||||||||||||
The Terraces | 100.0 | % | 173 | 95.9 | % | $ | 37.99 | $ | 57.99 | $ | 6,290 | |||||||||||||||
2525 McKinnon | 100.0 | % | 111 | 93.0 | % | $ | 27.05 | $ | 46.05 | $ | 2,801 | |||||||||||||||
Portland, OR |
AmberGlen | 76.0 | % | 203 | 98.4 | % | $ | 23.55 | $ | 26.45 | $ | 4,695 | ||||||||||||||
Cascade Station | 100.0 | % | 128 | 100.0 | % | $ | 28.77 | $ | 30.68 | $ | 3,685 | |||||||||||||||
San Diego, CA |
Mission City | 100.0 | % | 281 | 88.0 | % | $ | 38.24 | $ | 38.24 | $ | 9,466 | ||||||||||||||
Seattle, WA |
Canyon Park | 100.0 | % | 207 | 100.0 | % | $ | 23.17 | $ | 27.17 | $ | 4,791 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total / Weighted Average – Excluding Acquisitions in Lease-Up (3) |
|
5,498 |
88.6 |
% |
$ |
27.54 |
$ |
30.49 |
$ |
133,945 |
||||||||||||||||
Raleigh, NC (8.3%) |
Bloc 83 | 100.0 | % | 495 | 68.3 | % | $ | 37.03 | $ | 37.12 | $ | 12,527 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total / Weighted Average – June 30, 2022 |
|
5,993 |
86.9 |
% |
$ |
28.16 |
$ |
30.92 |
$ |
146,472 |
||||||||||||||||
|
|
|
|
(1) | Annualized gross rent per square foot includes adjustment for estimated expense reimbursements of triple net leases. |
(2) | Annualized base rent is calculated by multiplying (i) rental payments (defined as cash rents before abatements) for the month ended June 30, 2022 by (ii) 12. |
(3) | Averages weighted based on the property’s NRA, adjusted for occupancy. Including contracted leases, occupancy was 85.2% at Bloc 83 as of June 30, 2022. |
Payments Due by Period |
||||||||||||||||||||
Contractual Obligations |
Total |
2022 |
2023-2024 |
2025-2026 |
More than 5 years |
|||||||||||||||
Principal payments on mortgage loans |
$ | 658,605 | $ | 3,141 | $ | 156,628 | $ | 258,533 | $ | 240,303 | ||||||||||
Interest payments (1) |
94,099 | 12,307 | 45,770 | 28,211 | 7,811 | |||||||||||||||
Tenant-related commitments |
23,620 | 23,620 | — | — | — | |||||||||||||||
Lease obligations |
37,539 | 307 | 1,625 | 1,510 | 34,097 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total |
$ | 813,863 | $ | 39,375 | $ | 204,023 | $ | 288,254 | $ | 282,211 | ||||||||||
|
|
|
|
|
|
|
|
|
|
(1) | Contracted interest on the floating rate borrowings under our Unsecured Credit Facility was calculated based on the balance and interest rate at June 30, 2022. Contracted interest on the Term Loan was calculated based on the Interest Rate Swap rate fixing the LIBOR component of the borrowing rate to approximately 1.27%. |
Issuer Purchases of Equity Securities (1) |
||||||||||||||||
Period |
Total Number of Shares of Common Stock Purchased |
Average Price Paid per Share of Common Stock Repurchased |
Total Number of Shares of Common Stock Purchased as Part of Share Repurchase Plans |
Approximate Dollar Value of Shares of Common Stock that May Yet Be Purchased Under the Share Repurchase Plans (2) (thousands) |
||||||||||||
April 1 – 30, 2022 |
— | $ | — | — | $ | 50,000 | ||||||||||
May 1 – 31, 2022 |
— | — | — | 50,000 | ||||||||||||
June 1 – 30, 2022 |
394,833 | 12.64 | 394,833 | 45,008 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total |
394,833 | $ | 12.64 | 394,833 | $ | 45,008 | ||||||||||
|
|
|
|
|
|
|
|
(1) | The share repurchase plan was announced on August 5, 2020, approving the Company to repurchase an aggregate amount of $50 million of its outstanding shares of common stock. The share repurchase plan does not have an expiration date. |
(2) | Represents approximate dollar value of shares that could have been purchased under the plans in effect at the end of the month. |
Date: August 4, 2022 | ||||||
By: | /s/ James Farrar | |||||
James Farrar | ||||||
Chief Executive Officer and Director (Principal Executive Officer) | ||||||
Date: August 4, 2022 | ||||||
By: | /s/ Anthony Maretic | |||||
Anthony Maretic | ||||||
Chief Financial Officer, Secretary and Treasurer (Principal Financial Officer and Principal Accounting Officer) |
Exhibit 31.1
Certification
I, James Farrar, certify that:
1. | I have reviewed this Quarterly Report on Form 10-Q for the period ended June 30, 2022 of City Office REIT, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a15(e) and 15d15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a15(f) and 15d15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
August 4, 2022 | /s/ James Farrar | |||||
Date | James Farrar | |||||
Chief Executive Officer and Director | ||||||
(Principal Executive Officer) |
Exhibit 31.2
Certification
I, Anthony Maretic, certify that:
1. | I have reviewed this Quarterly Report on Form 10-Q for the period ended June 30, 2022 of City Office REIT, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a15(e) and 15d15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a15(f) and 15d15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
August 4, 2022 | /s/ Anthony Maretic | |||||
Date | Anthony Maretic | |||||
Chief Financial Officer, Secretary and Treasurer | ||||||
(Principal Financial Officer and Principal Accounting Officer) |
Exhibit 32.1
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with this Quarterly Report on Form 10-Q for the period ended June 30, 2022 of City Office REIT, Inc. (the Company) as filed with the Securities and Exchange Commission on the date hereof (the Report), I, James Farrar, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
August 4, 2022 | /s/ James Farrar | |||||
Date | James Farrar | |||||
Chief Executive Officer and Director | ||||||
(Principal Executive Officer) |
This written report is being furnished to the Securities and Exchange Commission as an exhibit to the Report. A signed original of this written statement required by Section 906 has been provided to City Office REIT, Inc. and will be retained by City Office REIT, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.
Exhibit 32.2
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with this Quarterly Report on Form 10-Q for the period ended June 30, 2022 of City Office REIT, Inc. (the Company) as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Anthony Maretic, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
August 4, 2022 | /s/ Anthony Maretic | |||||
Date | Anthony Maretic | |||||
Chief Financial Officer, Secretary and Treasurer | ||||||
(Principal Financial Officer and Principal Accounting Officer) |
This written report is being furnished to the Securities and Exchange Commission as an exhibit to the Report. A signed original of this written statement required by Section 906 has been provided to City Office REIT, Inc. and will be retained by City Office REIT, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2022 |
Dec. 31, 2021 |
|
Statement of Financial Position [Abstract] | ||
Preferred stock, Dividend rate percentage | 6.625% | 6.625% |
Preferred stock, par value per share | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,600,000 | 5,600,000 |
Preferred stock, shares issued | 4,480,000 | 4,480,000 |
Preferred stock, shares outstanding | 4,480,000 | 4,480,000 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 43,330,831 | 43,554,375 |
Common stock, shares outstanding | 43,330,831 | 43,554,375 |
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Income Statement [Abstract] | ||||
Rental and other revenues | $ 45,498 | $ 39,964 | $ 90,350 | $ 79,480 |
Operating expenses: | ||||
Property operating expenses | 16,836 | 14,179 | 33,325 | 28,297 |
General and administrative | 3,614 | 3,068 | 7,070 | 5,868 |
Depreciation and amortization | 15,701 | 14,954 | 31,516 | 29,369 |
Total operating expenses | 36,151 | 32,201 | 71,911 | 63,534 |
Operating income | 9,347 | 7,763 | 18,439 | 15,946 |
Interest expense: | ||||
Contractual interest expense | (5,982) | (5,639) | (11,729) | (11,883) |
Amortization of deferred financing costs and debt fair value | (302) | (272) | (614) | (602) |
Interest expense, net | (6,284) | (5,911) | (12,343) | (12,485) |
Net gain on sale of real estate property | 0 | 0 | 21,658 | 47,400 |
Net income | 3,063 | 1,852 | 27,754 | 50,861 |
Net income attributable to non-controlling interests in properties | (164) | (190) | (335) | (382) |
Net income attributable to the Company | 2,899 | 1,662 | 27,419 | 50,479 |
Preferred stock distributions | (1,855) | (1,855) | (3,710) | (3,710) |
Net income/(loss) attributable to common stockholders | $ 1,044 | $ (193) | $ 23,709 | $ 46,769 |
Net income/(loss) per common share: | ||||
Basic | $ 0.02 | $ 0 | $ 0.54 | $ 1.08 |
Diluted | $ 0.02 | $ 0 | $ 0.53 | $ 1.06 |
Weighted average common shares outstanding: | ||||
Basic | 43,632 | 43,482 | 43,593 | 43,440 |
Diluted | 44,482 | 43,482 | 44,445 | 44,080 |
Dividend distributions declared per common share | $ 0.2 | $ 0.15 | $ 0.4 | $ 0.3 |
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 3,063 | $ 1,852 | $ 27,754 | $ 50,861 |
Other comprehensive income: | ||||
Unrealized cash flow hedge gain/(loss) | 450 | (47) | 2,064 | 480 |
Amounts reclassified to interest expense | 63 | 147 | 203 | 289 |
Other comprehensive income | 513 | 100 | 2,267 | 769 |
Comprehensive income | 3,576 | 1,952 | 30,021 | 51,630 |
Comprehensive income attributable to non-controlling interests in properties | (164) | (190) | (335) | (382) |
Comprehensive income attributable to the Company | $ 3,412 | $ 1,762 | $ 29,686 | $ 51,248 |
Organization and Description of Business |
6 Months Ended |
---|---|
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | 1. Organization and Description of Business City Office REIT, Inc. (the “Company”) was organized in the state of Maryland on November 26, 2013. On April 21, 2014, the Company completed its initial public offering (“IPO”) of shares of the Company’s common stock. The Company contributed the net proceeds of the IPO to City Office REIT Operating Partnership, L.P., a Maryland limited partnership (the “Operating Partnership”), in exchange for common units of limited partnership interest in the Operating Partnership (“common units”). The Company’s interest in the Operating Partnership entitles the Company to share in distributions from, and allocations of profits and losses of, the Operating Partnership in proportion to the Company’s percentage ownership of common units. As the sole general partner of the Operating Partnership, the Company has the exclusive power under the Operating Partnership’s partnership agreement to manage and conduct the Operating Partnership’s business, subject to limited approval and voting rights of the limited partners. The Company has elected to be taxed and will continue to operate in a manner that will allow it to continue to qualify as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Code”). Subject to qualification as a REIT, the Company will be permitted to deduct dividend distributions paid to its stockholders, eliminating the U.S. federal taxation of income represented by such distributions at the Company level. REITs are subject to a number of organizational and operational requirements. If the Company fails to qualify as a REIT in any taxable year, the Company will be subject to U.S. federal and state income tax on its taxable income at regular corporate tax rates and, for tax years beginning before 2018, any applicable alternative minimum tax.
|
Summary of Significant Accounting Policies |
6 Months Ended |
---|---|
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Preparation and Summary of Significant Accounting Policies The accompanying unaudited condensed consolidated financial statements have been prepared by the Company in accordance with Securities and Exchange Commission (“SEC”) rules and regulations and generally accepted accounting principles in the United States of America (“US GAAP”) and in the opinion of management contain all adjustments (including normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows for the periods presented. The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Recent Accounting Pronouncements In March 2020, the Financial Accounting Standards Board (the “FASB”) established Topic 848, Facilitation of the Effects of Reference Rate Reform on Financial Reporting, by issuing Accounting Standards Update (“ASU”) No. 2020-04 (“ASU 2020-04”). ASU 2020-04 provides companies with optional expedients and exceptions to the guidance on contract modifications and hedge accounting to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued. For contracts affected by reference rate reform, if certain criteria are met, companies can elect to not remeasure contracts at the modification date or reassess a previous accounting conclusion. Companies can also elect various optional expedients that would allow them to continue applying hedge accounting for hedging relationships affected by reference rate reform if certain criteria are met. Further, in January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848) (“ASU 2021-01”). ASU 2021-01 clarifies the scope of Topic 848 so that derivatives affected by the discounting transition are explicitly eligible for certain optional expedients and exceptions in Topic 848.2020-04 and ASU 2021-01 can be applied as of the beginning of the interim period that includes March 12, 2020, however, the guidance will only be available for optional use through December 31, 2022. The new standard applies prospectively to contract modifications and hedging relationships and may be elected over time as reference rate reform activities occur. The Company has not yet adopted the standard and continues to evaluate the impact of ASU 2020-04 and ASU 2021-01 on its consolidated financial statements and may elect optional expedients in future periods as reference rate reform activities occur.In July 2021, the FASB issued ASU
No. 2021-05 (“ASU 2021-05”), Leases (Topic 842): Lessors—Certain Leases with Variable Lease Payments. ASU 2021-05 requires lessors to classify a lease with variable lease payments that do not depend on an index or rate as an operating lease if the lease would have been classified as a sales-type lease or a direct financing lease under the pre-ASU classification criteria, and sales-type or direct financing classification would result in a Day 1 loss. The ASU is effective for fiscal years beginning after December 15, 2021. The ASU may be early adopted and can be applied either retrospectively to leases that commenced or were modified on or after the adoption of ASU No. 2016-02 or prospectively to leases that commence or are modified on or after the date that an entity first applies the amendments. The Company adopted ASU 2021-05 prospectively on January 1, 2022. The adoption of ASU 2021-05 did not have a material impact on the Company’s consolidated financial statements. |
Real Estate Investments |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate Investments | 3. Real Estate Investments Acquisitions During the six months ended June 30, 2022 and 2021 the Company acquired the following properties:
The foregoing acquisition was accounted for as an asset acquisition. The following table summarizes the Company’s allocation of the purchase price of assets acquired and liabilities assumed during the six months ended June 30, 2021 (in thousands):
Sale of Real Estate Property During the first quarter of 2022, the sole tenant at the Lake Vista Pointe property exercised its lease option to purchase the building and the Company signed a purchase and sale agreement with the tenant. At the time the tenant exercised the option, the Company reassessed the lease classification of the lease, in accordance with ASC 842 – Leases, and determined that the lease should be reclassified from an operating lease to a sales-type lease. This reclassification resulted in a gain on sale of million net of disposal related costs. On June 15, 2022, the Company sold the Lake Vista Pointe property in Dallas, Texas for a gross sales price of 43.8 million. On February 10 operations. |
Lease Intangibles |
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Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lease Intangibles | 4. Lease Intangibles Lease intangibles and the value of assumed lease obligations as of June 30, 2022 and December 31, 2021 were comprised of the following (in thousands):
The estimated aggregate amortization expense for lease intangibles for the next five years and in the aggregate are as follows (in thousands):
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Debt |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | 5. Debt The following table summarizes the indebtedness as of June 30, 2022 and December 31, 2021 (dollars in thousands):
The scheduled principal repayments of debt as of June 30, 2022 are as follows (in thousands):
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Fair Value of Financial Instruments |
6 Months Ended |
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Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 6. Fair Value of Financial Instruments Fair value measurements are based on assumptions that market participants would use in pricing an asset or a liability. The hierarchy for inputs used in measuring fair value is as follows: Level 1 Inputs – quoted prices in active markets for identical assets or liabilities Level 2 Inputs – observable inputs other than quoted prices in active markets for identical assets and liabilities Level 3 Inputs – unobservable inputs In September 2019 30-day LIBOR payments. Accordingly, the fair value of the Interest Rate Swap has been classified as a Level 2 fair value measurement. The Interest As of June 30, 2022, the Interest Rate Swap was reported as a n asset at its fair value of approximately $1.9 million, which is included in other assets on the Company’s condensed consolidated balance sheet. For the six months ended June 30, 2022, approximately $0.2 million of realized losses were reclassified to interest expense due to payments made to the swap counterparty. For the six months ended June 30, 2021, approximately $0.3 million of realized losses were reclassified to interest expense due to payments made to the swap counterparty. As of December 31, 2021, the Interest Rate Swap was reported as a liability at its fair value of approximately $0.4 million, which is included in other liabilities on the Company’s condensed consolidated balance sheet. Cash, Cash Equivalents, Restricted Cash, Rents Receivable, Accounts Payable and Accrued Liabilities The Company estimates that the fair value approximates carrying value due to the relatively short-term nature of these instruments. Fair Value of Financial Instruments Not Carried at Fair Value With the exception of fixed rate mortgage loans payable, the carrying amounts of the Company’s financial instruments approximate their fair value. The Company determines the fair value of its fixed rate mortgage loan payable based on a discounted cash flow analysis using a discount rate that approximates the current borrowing rates for instruments of similar maturities. Based on this, the Company has determined that the fair value of these instruments was $436.7 million and $478.1 million (compared to a carrying value of $446.6 million and $466.5 million) as of June 30, 2022, and December 31, 2021, respectively. Accordingly, the fair value of mortgage loans payable have been classified as Level 3 fair value measurements.
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Related Party Transactions |
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Jun. 30, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 7. Related Party Transactions Administrative Services Agreement For the six months ended June 30, 2022 and 2021, the Company earned $0.3 million and $0.3 million, respectively, in administrative services performed for Second City Real Estate II Corporation (“Second City”), Clarity Real Estate Ventures GP, Limited Partnership (“Clarity”) and their affiliates.
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Leases |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | 8. Leases Lessor Accounting The Company is focused on acquiring, owning and operating high-quality office properties for lease to a stable and diverse tenant base. Our properties have both full-service gross and net leases which are generally classified as operating leases. Rental income related to such leases is recognized on a straight-line basis over the remaining lease term. The Company’s total revenue includes fixed base rental payments provided under the lease and variable payments which principally consist of tenant expense reimbursements for certain property operating expenses. The Company recognized fixed and variable lease payments for operating leases for the three and six months ended June 30, 2022 and the three and six months ended June 30, 2021 as follows (in thousands):
The Company recognized interest income of million and variable lease payments of $0.2 million for the sales-type lease at the Lake Vista Pointe property for the three a n d six months ended June 30, 2022. Future minimum lease payments to be received by the Company as of June 30, 2022 under non-cancellable operating leases for the next five years and thereafter are as follows (in thousands):
The Company’s leases may include various provisions such as scheduled rent increases, renewal options and termination options. The majority of the Company’s leases include defined rent increase rather than variable payments based on an index or unknown rate. Lessee Accounting As a lessee, the Company has ground and office leases which are classified as operating and financing leases. As of June 30, 2022, these leases had remaining terms of under one year to 66 years and a weighted average remaining lease term of 50 years. Right-of-use assets and lease liabilities have been included within other assets and other liabilities on the Company’s condensed consolidated balance sheet as follows (in thousands):
Lease liabilities are measured at the commencement date based on the present value of future lease payments. One of the Company’s operating ground leases includes rental payment increases over the lease term based on increases in the Consumer Price Index (“CPI”). Changes in the CPI were not estimated as part of the measurement of the operating lease liability. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. The Company used a weighted average discount rate of 6.2 % in determining its lease liabilities. The discount rates were derived from the Company’s assessment of the credit quality of the Company and adjusted to reflect secured borrowing, estimated yield curves and long-term spread adjustments. Right-of-use Operating lease Future minimum lease payments to be paid by the Company as a lessee for operating and financing leases as of June 30, 2022 for the next five years and thereafter are as follows (in thousands):
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Commitments and Contingencies |
6 Months Ended |
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Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. Commitments and Contingencies The Company is obligated under certain tenant leases to fund tenant improvements and the expansion of the underlying leased properties. Under various federal, state and local laws, ordinances and regulations relating to the protection of the environment, a current or previous owner or operator of real estate may be liable for the cost of removal or remediation of certain hazardous or toxic substances disposed, stored, generated, released, manufactured or discharged from, on, at, under, or in a property. As such, the Company may be potentially liable for costs associated with any potential environmental remediation at any of its formerly or currently owned properties. The Company believes that it is in compliance in all material respects with all federal, state and local ordinances and regulations regarding hazardous or toxic substances. Management is not aware of any environmental liability that it believes would have a material adverse impact on the Company’s financial position or results of operations. Management is unaware of any instances in which the Company would incur significant environmental costs if any or all properties were sold, disposed of or abandoned. However, there can be no assurance that any such non-compliance, liability, claim or expenditure will not arise in the future. The Company is involved from time to time in lawsuits and other disputes which arise in the ordinary course of business. As of June 30, 2022, management believes that these matters will not have a material adverse effect, individually or in the aggregate, on the Company’s financial position or results of operations.
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Stockholder's Equity |
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Stockholder's Equity | 10. Stockholders’ Equity Share Repurchase Plan On March 9, 2020, the Company’s Board of Directors approved a share repurchase plan authorizing the Company to repurchase up to $100 million of its outstanding shares of common stock. In July 2020, the Company completed the full March 2020 share repurchase plan. On August 5, 2020, the Company’s Board of Directors approved an additional share repurchase plan authorizing the Company to repurchase up to an additional aggregate amount of $50 million of its outstanding shares of common stock. Under the share repurchase programs, the shares may be repurchased from time to time using a variety of methods, which may include open market transactions, privately negotiated transactions or otherwise, all in accordance with the rules of the SEC and other applicable legal requirements. Repurchased paid-in capital by the amount that the purchase price for the shares of common stock repurchased exceed the par value. During the six months ended June 30, 2022, the Company completed the repurchase of 394,833 shares of its common stock for approximately $5.0 million. There were no shares repurchased during the six months ended June 30, 2021. Common Stock and Common Unit Distributions On June 16, 2022, the Company’s Board of Directors approved and the Company declared a cash dividend distribution of $0.20 per common share for the quarterly period ended June 30, 2022. The dividend was paid subsequent to quarter end on July 22, 2022 to common stockholders and common unitholders of record as of the close of business on July 8, 2022, resulting in an aggregate payment of $8.6 million. Preferred Stock Distributions On June 16, 2022, the Company’s Board of Directors approved and the Company declared a cash dividend distribution of $0.4140625 per share of the Company’s 6.625% Series A Preferred Stock (“Series A Preferred Stock”) for an aggregate amount of $1.9 million for the quarterly period ended June 30, 2022. The dividend was paid subsequent to quarter end on July 22, 2022 to the holders of record of Series A Preferred Stock as of the close of business on July 8, 2022. Equity Incentive Plan The Company has an equity incentive plan (“Equity Incentive Plan”) for executive officers, directors and certain non-executive employees, and with approval of the Board of Directors, for subsidiaries and their respective affiliates. The Equity Incentive Plan provides for grants of restricted common stock, restricted stock units, phantom shares, stock options, dividend equivalent rights and other equity-based awards (including LTIP Units), subject to the total number of shares available for issuance under the plan. The Equity Incentive Plan is administered by the compensation committee of the Board of Directors (the “Plan Administrator”). On May 4, 2022, the Company’s stockholders approved an amendment to the Equity Incentive Plan increasing the maximum number of shares of common stock that may be issued under the Equity Incentive Plan from 2,263,580 shares to 3,763,580 shares. To the extent an award granted under the Equity Incentive Plan expires or terminates, the shares subject to any portion of the award that expires or terminates without having been exercised or paid, as the case may be, will again become available for the issuance of additional awards. On January The following table summarizes the activity of the awards under the Equity Incentive Plan for the three and six months ended June 30, 2022:
The following table summarizes the activity of the awards under the Equity Incentive Plan for the three and six months ended June 30, 2021:
During the six months ended June 30, 2022 and June 30, 2021, the Company granted the following restricted stock units (“RSUs”) and Performance RSU Awards to directors, executive officers and certain non-executive employees:
The During the three months ended June 30, 2022 and June 30, 2021, the Company recognized net compensation expense for the RSUs and Performance RSU Awards as follows (in thousands):
During the six months ended June 30, 2022 and June 30, 2021, the Company recognized net compensation expense for the RSUs and Performance RSU Awards as follows (in thousands):
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Subsequent Events |
6 Months Ended |
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Jun. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | 11. Subsequent Events Subsequent to quarter end through August 2, 2022, the Com p any completed the repurchase of an additional |
Summary of Significant Accounting Policies (Policies) |
6 Months Ended |
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Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Preparation and Summary of Significant Accounting Policies | Basis of Preparation and Summary of Significant Accounting Policies The accompanying unaudited condensed consolidated financial statements have been prepared by the Company in accordance with Securities and Exchange Commission (“SEC”) rules and regulations and generally accepted accounting principles in the United States of America (“US GAAP”) and in the opinion of management contain all adjustments (including normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows for the periods presented. The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes thereto included in the Company’s Annual Report on Form
10-K for the year ended December 31, 2021. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2020, the Financial Accounting Standards Board (the “FASB”) established Topic 848, Facilitation of the Effects of Reference Rate Reform on Financial Reporting, by issuing Accounting Standards Update (“ASU”) No. 2020-04 (“ASU 2020-04”). ASU 2020-04 provides companies with optional expedients and exceptions to the guidance on contract modifications and hedge accounting to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued. For contracts affected by reference rate reform, if certain criteria are met, companies can elect to not remeasure contracts at the modification date or reassess a previous accounting conclusion. Companies can also elect various optional expedients that would allow them to continue applying hedge accounting for hedging relationships affected by reference rate reform if certain criteria are met. Further, in January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848) (“ASU 2021-01”). ASU 2021-01 clarifies the scope of Topic 848 so that derivatives affected by the discounting transition are explicitly eligible for certain optional expedients and exceptions in Topic 848.2020-04 and ASU 2021-01 can be applied as of the beginning of the interim period that includes March 12, 2020, however, the guidance will only be available for optional use through December 31, 2022. The new standard applies prospectively to contract modifications and hedging relationships and may be elected over time as reference rate reform activities occur. The Company has not yet adopted the standard and continues to evaluate the impact of ASU 2020-04 and ASU 2021-01 on its consolidated financial statements and may elect optional expedients in future periods as reference rate reform activities occur.In July 2021, the FASB issued ASU
No. 2021-05 (“ASU 2021-05”), Leases (Topic 842): Lessors—Certain Leases with Variable Lease Payments. ASU 2021-05 requires lessors to classify a lease with variable lease payments that do not depend on an index or rate as an operating lease if the lease would have been classified as a sales-type lease or a direct financing lease under the pre-ASU classification criteria, and sales-type or direct financing classification would result in a Day 1 loss. The ASU is effective for fiscal years beginning after December 15, 2021. The ASU may be early adopted and can be applied either retrospectively to leases that commenced or were modified on or after the adoption of ASU No. 2016-02 or prospectively to leases that commence or are modified on or after the date that an entity first applies the amendments. The Company adopted ASU 2021-05 prospectively on January 1, 2022. The adoption of ASU 2021-05 did not have a material impact on the Company’s consolidated financial statements. |
Real Estate Investments (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Acquired Properties | During the six months ended June 30, 2022 and 2021 the Company acquired the following properties:
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Schedule of Allocation of Purchase Price of Assets Acquired and Liabilities Assumed | The following table summarizes the Company’s allocation of the purchase price of assets acquired and liabilities assumed during the six months ended June 30, 2021 (in thousands):
|
Lease Intangibles (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Lease Intangibles and Value of Assumed Lease Obligations | Lease intangibles and the value of assumed lease obligations as of June 30, 2022 and December 31, 2021 were comprised of the following (in thousands):
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Estimated Aggregate Amortization Expense for Lease Intangibles | The estimated aggregate amortization expense for lease intangibles for the next five years and in the aggregate are as follows (in thousands):
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Debt (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Outstanding Indebtness | The following table summarizes the indebtedness as of June 30, 2022 and December 31, 2021 (dollars in thousands):
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Schedule of Principal Repayments of Mortgage Payable | The scheduled principal repayments of debt as of June 30, 2022 are as follows (in thousands):
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Leases (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating Lease Lease Income | The Company recognized fixed and variable lease payments for operating leases for the three and six months ended June 30, 2022 and the three and six months ended June 30, 2021 as follows (in thousands):
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Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum lease payments to be received by the Company as of June 30, 2022 under non-cancellable operating leases for the next five years and thereafter are as follows (in thousands):
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Schedule Of Supplemental Balance Sheet Information Related To Leases | Right-of-use assets and lease liabilities have been included within other assets and other liabilities on the Company’s condensed consolidated balance sheet as follows (in thousands):
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Schedule future minimum lease payments to be paid |
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Stockholder's Equity (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Federal Home Loan Banks [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Activity of Awards under Equity Incentive Plan | The following table summarizes the activity of the awards under the Equity Incentive Plan for the three and six months ended June 30, 2022:
The following table summarizes the activity of the awards under the Equity Incentive Plan for the three and six months ended June 30, 2021:
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Summary of Restricted Stock Units ("RSUs") and Performance RSU | During the six months ended June 30, 2022 and June 30, 2021, the Company granted the following restricted stock units (“RSUs”) and Performance RSU Awards to directors, executive officers and certain non-executive employees:
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Summary of Recognized Compensation Expense for RSUs and Performance RSU | During the three months ended June 30, 2022 and June 30, 2021, the Company recognized net compensation expense for the RSUs and Performance RSU Awards as follows (in thousands):
During the six months ended June 30, 2022 and June 30, 2021, the Company recognized net compensation expense for the RSUs and Performance RSU Awards as follows (in thousands):
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Organization and Description of Business - Additional Information (Detail) |
6 Months Ended |
---|---|
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Company formation date | Nov. 26, 2013 |
Operation commencement date | Apr. 21, 2014 |
Real Estate Investments - Schedule of Acquired Properties through Operating Partnership (Detail) - 5910 Pacific Center and 9985 Pacific Heights [Member] |
6 Months Ended |
---|---|
Jun. 30, 2021 | |
Acquisitions [Line Items] | |
Real estate property, date acquired, asset acquisitions | 2021-05 |
Real estate property, percentage owned, asset acquisitions | 100.00% |
Real Estate Investments - Schedule of Allocation of Purchase Price of Assets Acquired and Liabilities Assumed (Detail) - 5910 Pacific Center and 9985 Pacific Heights [Member] $ in Thousands |
Jun. 30, 2021
USD ($)
|
---|---|
Acquisitions [Line Items] | |
Land | $ 37,294 |
Building and improvement | 2,979 |
Tenant improvement | 917 |
Lease intangible assets | 2,469 |
Other assets | 19 |
Accounts payable and other liabilities | (319) |
Lease intangible liabilities | (103) |
Net assets acquired | $ 43,256 |
Real Estate Investments - Additional Information (Detail) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 15, 2022 |
Feb. 10, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Real Estate [Line Items] | ||||||
Gain on sale of Real Estate Property | $ 0 | $ 0 | $ 21,658 | $ 47,400 | ||
Cherry Creek [Member] | ||||||
Real Estate [Line Items] | ||||||
Gain on sale of Real Estate Property | $ 47,400 | |||||
Proceeds of sale of property | $ 95,000 | |||||
Lake Vista Pointe [Member] | ||||||
Real Estate [Line Items] | ||||||
Reclassification in gain on sale | $ 21,700 | |||||
Gross proceeds from sale of real estate property | $ 43,800 |
Lease Intangibles - Estimated Aggregate Amortization Expense for Lease Intangibles (Detail) $ in Thousands |
Jun. 30, 2022
USD ($)
|
---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | |
2022 | $ 5,283 |
2023 | 9,028 |
2024 | 6,695 |
2025 | 6,507 |
2026 | 6,461 |
Thereafter | 17,746 |
Total | $ 51,720 |
Debt - Summary of Outstanding Indebtedness (Detail) - USD ($) $ in Thousands |
6 Months Ended | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2022 |
Dec. 31, 2021 |
|||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 658,605 | $ 658,538 | ||||||||||||
Deferred financing costs, net | (4,501) | (5,223) | ||||||||||||
Unamortized fair value adjustments | 262 | 333 | ||||||||||||
Total | 654,366 | 653,648 | ||||||||||||
Unsecured Debt [Member] | Term loan [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | [1] | $ 50,000 | 50,000 | |||||||||||
Interest Rate, terms | [1],[2] | LIBOR +1.25 | ||||||||||||
Interest Rate, spread | [1],[2] | 1.25% | ||||||||||||
Maturity | [1] | 2024-09 | ||||||||||||
Credit Facility [Member] | Unsecured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | [1],[3] | $ 162,000 | 142,000 | |||||||||||
Interest Rate, terms | [1],[2],[3] | LIBOR +1.30 | ||||||||||||
Interest Rate, spread | [1],[2],[3] | 1.30% | ||||||||||||
Maturity | [1],[3] | 2025-11 | ||||||||||||
Mission City [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 47,000 | 47,000 | ||||||||||||
Interest Rate | 3.78% | |||||||||||||
Maturity | 2027-11 | |||||||||||||
190 Office Center [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 39,239 | 39,581 | ||||||||||||
Interest Rate | 4.79% | |||||||||||||
Maturity | 2025-10 | |||||||||||||
Canyon Park [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | [4] | $ 40,031 | 40,381 | |||||||||||
Interest Rate | [4],[5] | 4.30% | ||||||||||||
Maturity | [4] | 2027-03 | ||||||||||||
Circle Point [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 39,650 | 39,650 | ||||||||||||
Interest Rate | 4.49% | |||||||||||||
Maturity | 2028-09 | |||||||||||||
SanTan [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 32,477 | 32,807 | ||||||||||||
Interest Rate | 4.56% | |||||||||||||
Maturity | 2027-03 | |||||||||||||
Intellicenter [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 31,591 | 31,883 | ||||||||||||
Interest Rate | 4.65% | |||||||||||||
Maturity | 2025-10 | |||||||||||||
The Quad [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 30,600 | 30,600 | ||||||||||||
Interest Rate | 4.20% | |||||||||||||
Maturity | 2028-09 | |||||||||||||
FRP Collection [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 27,162 | 27,535 | ||||||||||||
Interest Rate | 3.10% | |||||||||||||
Maturity | 2023-09 | |||||||||||||
2525 McKinnon [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 27,000 | 27,000 | ||||||||||||
Interest Rate | 4.24% | |||||||||||||
Maturity | 2027-04 | |||||||||||||
Cascade Station [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 21,387 | 21,581 | ||||||||||||
Interest Rate | 4.55% | |||||||||||||
Maturity | 2024-05 | |||||||||||||
Greenwood Blvd [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 21,660 | 21,920 | ||||||||||||
Interest Rate | 3.15% | |||||||||||||
Maturity | 2025-12 | |||||||||||||
5090 N 40th St [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 21,024 | 21,233 | ||||||||||||
Interest Rate | 3.92% | |||||||||||||
Maturity | 2027-01 | |||||||||||||
AmberGlen [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 20,000 | 20,000 | ||||||||||||
Interest Rate | 3.69% | |||||||||||||
Maturity | 2027-05 | |||||||||||||
Lake Vista Pointe [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | [6] | $ 0 | 17,018 | |||||||||||
Central Fairwinds [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 16,491 | 16,707 | ||||||||||||
Interest Rate | 3.15% | |||||||||||||
Maturity | 2024-06 | |||||||||||||
FRP Ingenuity Drive [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 16,312 | 16,457 | ||||||||||||
Interest Rate | 4.44% | |||||||||||||
Maturity | 2024-12 | |||||||||||||
Carillon Point [Member] | Secured Debt [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Indebtedness | $ 14,981 | $ 15,185 | ||||||||||||
Interest Rate | 3.10% | |||||||||||||
Maturity | 2023-10 | |||||||||||||
|
Debt - Summary of Outstanding Indebtedness (Parenthetical) (Detail) - USD ($) $ in Thousands |
1 Months Ended | 6 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2022 |
Nov. 16, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
Sep. 30, 2019 |
Mar. 31, 2018 |
|||||||
Debt Instrument [Line Items] | ||||||||||||
Repayment of borrowings | $ 30,941 | $ 163,363 | ||||||||||
Interest Rate Swap [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Derivative, Fixed Interest Rate | 1.27% | |||||||||||
Derivative, Notional Amount | $ 50,000 | |||||||||||
Minimum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Revolving Credit Facility, authorized amount | 250,000 | |||||||||||
Maximum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Revolving Credit Facility, authorized amount | 300,000 | |||||||||||
Unsecured Debt [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Term loan | $ 50,000 | |||||||||||
Lake Vista Pointe [Member] | Secured Debt [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Repayment of borrowings | $ 16,800 | |||||||||||
Canyon Park [Member] | Secured Debt [Member] | Minimum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest Rate, Description | 0.02% | |||||||||||
Canyon Park [Member] | Secured Debt [Member] | Maximum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest Rate, Description | 0.045% | |||||||||||
Credit Facility [Member] | Letter of Credit [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Revolving Credit Facility, outstanding | 4,200 | $ 4,200 | ||||||||||
Credit Facility [Member] | Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest Rate, Description | 0.0125% | |||||||||||
Credit Facility [Member] | Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest Rate, Description | 0.0215% | |||||||||||
Credit Facility [Member] | Unsecured Debt [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Revolving Credit Facility, authorized amount | $ 300,000 | $ 250,000 | ||||||||||
Revolving Credit Facility, outstanding | $ 162,000 | $ 162,000 | ||||||||||
Loan maturity date | Nov. 16, 2025 | |||||||||||
Loan expected extended maturity date | Nov. 16, 2026 | |||||||||||
Revolving Credit Facility, maximum borrowing capacity | $ 500,000 | |||||||||||
Interest Rate, Description | [1],[2],[3] | 1.30% | ||||||||||
Credit Facility [Member] | Unsecured Debt [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
One month LIBOR rate | 1.79% | 1.79% | ||||||||||
Credit Facility [Member] | Unsecured Debt [Member] | Minimum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Revolving Credit Facility, authorized amount | $ 300,000 | |||||||||||
Fixed charge coverage ratio | 1.50% | 1.50% | ||||||||||
Credit Facility [Member] | Unsecured Debt [Member] | Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest Rate, Description | 0.0125% | |||||||||||
Credit Facility [Member] | Unsecured Debt [Member] | Maximum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Revolving Credit Facility, authorized amount | $ 350,000 | |||||||||||
Credit Facility [Member] | Unsecured Debt [Member] | Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest Rate, Description | 0.0225% | |||||||||||
|
Debt - Schedule of Principal Repayments of Mortgage Payable (Detail) - USD ($) $ in Thousands |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Debt Disclosure [Abstract] | ||
2022 | $ 3,141 | |
2023 | 48,149 | |
2024 | 108,479 | |
2025 | 253,997 | |
2026 | 4,536 | |
Thereafter | 240,303 | |
Total | $ 658,605 | $ 658,538 |
Related Party Transactions - Additional Information (Detail) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Administrative Services Agreement [Member] | Second City Funds [Member] | Clarity Real Estate Ventures GP, Limited [Member] | ||
Related Party Transaction [Line Items] | ||
Annual payment receivable for services | $ 0.3 | $ 0.3 |
Leases - Additional Information (Detail) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Lease cost | $ 0.3 | $ 0.3 | $ 0.5 | $ 0.5 |
Financing Lease Cost | $ 0.1 | $ 0.2 | ||
Operating Lease, Weighted Average Remaining Lease Term | 50 years | 50 years | ||
Operating Lease, Weighted Average Discount Rate, Percent | 6.20% | 6.20% | ||
Lake Vista Pointe [Member] | ||||
Interest income on sales type lease | $ 0.6 | $ 0.6 | ||
Variable lease payments on sales type lease | $ 0.2 | $ 0.2 | ||
Maximum [Member] | ||||
Remaining lease terms | 66 years | 66 years | ||
Minimum [Member] | ||||
Remaining lease terms | 1 year | 1 year |
Leases - Schedule of Operating Leases (Detail) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Fixed payments | $ 38,309 | $ 34,311 | $ 76,628 | $ 67,862 |
Variable payments | 6,180 | 5,629 | 12,620 | 11,536 |
Operating Lease, Lease Income | $ 44,489 | $ 39,940 | $ 89,248 | $ 79,398 |
Leases - Schedule of Future Minimum Lease Payments under Non-cancellable Operating Leases (Detail) $ in Thousands |
Jun. 30, 2022
USD ($)
|
---|---|
Leases [Abstract] | |
2022 | $ 63,397 |
2023 | 117,160 |
2024 | 104,445 |
2025 | 92,922 |
2026 | 84,779 |
Thereafter | 252,335 |
Total future minimum lease payments to be received | $ 715,038 |
Leases - Schedule of Operating Right-of-Use Assets and Lease Liabilities (Detail) - USD ($) $ in Thousands |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Lease liability – operating leases | $ 9,009 | |
Lease liability – financing leases | 1,450 | |
Other Assets [Member] | ||
Right-of-use asset - operating leases | 13,858 | $ 14,114 |
Right-of-use asset – financing leases | 10,180 | 10,308 |
Other Liabilities [Member] | ||
Lease liability – operating leases | 9,009 | 9,160 |
Lease liability – financing leases | $ 1,450 | $ 1,425 |
Leases - Schedule Future Minimum Lease Payments To Be Paid (Detail) $ in Thousands |
Jun. 30, 2022
USD ($)
|
---|---|
2022 | $ 290 |
2023 | 836 |
2024 | 770 |
2025 | 770 |
2026 | 724 |
Thereafter | 27,151 |
Total future minimum lease payments | 30,541 |
Discount | (21,532) |
Total | 9,009 |
2022 | 17 |
2023 | 12 |
2024 | 7 |
2025 | 8 |
2026 | 8 |
Thereafter | 6,946 |
Total future minimum lease payments | 6,998 |
Discount | (5,548) |
Total | $ 1,450 |
Stockholder's Equity - Summary of Activity of Awards under Equity Incentive Plan (Detail) - shares |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2022 |
Mar. 31, 2022 |
Jun. 30, 2021 |
Mar. 31, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Restricted Stock Units (RSUs) [Member] | ||||||
ScheduleOfShareBasedCompensationRestrictedStockUnitsAwardActivity [Line Items] | ||||||
Beginning balance | 584,047 | 342,159 | 507,074 | 332,435 | 342,159 | 332,435 |
Granted | 0 | 237,986 | 0 | 169,500 | 237,986 | 169,500 |
Issuance of dividend equivalents | 7,451 | 3,902 | 6,884 | 5,139 | ||
Vested | (177,812) | 0 | (177,038) | 0 | ||
Forfeited | 0 | 0 | 0 | 0 | ||
Ending balance | 413,686 | 584,047 | 336,920 | 507,074 | 413,686 | 336,920 |
Performance Restricted Stock Unit | ||||||
ScheduleOfShareBasedCompensationRestrictedStockUnitsAwardActivity [Line Items] | ||||||
Beginning balance | 307,500 | 217,500 | 217,500 | 97,500 | 217,500 | 97,500 |
Granted | 0 | 90,000 | 0 | 120,000 | 90,000 | 120,000 |
Issuance of dividend equivalents | 0 | 0 | 0 | 0 | ||
Vested | 0 | 0 | 0 | 0 | ||
Forfeited | 0 | 0 | 0 | 0 | ||
Ending balance | 307,500 | 307,500 | 217,500 | 217,500 | 307,500 | 217,500 |
Stockholder's Equity - Summary of Restricted Stock Units ("RSUs") and Performance RSU (Detail) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2022 |
Mar. 31, 2022 |
Jun. 30, 2021 |
Mar. 31, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
ScheduleOfShareBasedCompensationRestrictedStockUnitsAwardActivityGranted [Line Items] | ||||||
Fair Value | $ 5,753 | $ 2,808 | ||||
Weighted Average Grant Fair Value Per Share | $ 17.54 | $ 9.7 | ||||
Restricted Stock Units (RSUs) [Member] | ||||||
ScheduleOfShareBasedCompensationRestrictedStockUnitsAwardActivityGranted [Line Items] | ||||||
Units Granted | 0 | 237,986 | 0 | 169,500 | 237,986 | 169,500 |
Performance Restricted Stock Unit [Member] | ||||||
ScheduleOfShareBasedCompensationRestrictedStockUnitsAwardActivityGranted [Line Items] | ||||||
Units Granted | 0 | 90,000 | 0 | 120,000 | 90,000 | 120,000 |
Stockholder's Equity - Summary of Recognized Compensation Expense for RSUs and Performance RSU (Detail) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
ScheduleOfRecognizedNetCompensationExpense [Line Items] | ||||
Share-based Payment Arrangement, Amount Capitalized | $ 992 | $ 665 | $ 1,896 | $ 1,311 |
Restricted Stock Units (RSUs) [Member] | ||||
ScheduleOfRecognizedNetCompensationExpense [Line Items] | ||||
Share-based Payment Arrangement, Amount Capitalized | 652 | 457 | 1,251 | 920 |
Performance Restricted Stock Unit [Member] | ||||
ScheduleOfRecognizedNetCompensationExpense [Line Items] | ||||
Share-based Payment Arrangement, Amount Capitalized | $ 340 | $ 208 | $ 645 | $ 391 |
Subsequent Events - Additional Information (Detail) - USD ($) $ in Millions |
1 Months Ended | 6 Months Ended | |
---|---|---|---|
Aug. 02, 2022 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Subsequent Event [Line Items] | |||
Stock Repurchased During Period, Shares | 394,833 | 0 | |
Payment for repurchase of common stock | $ 5.0 | ||
Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Stock Repurchased During Period, Shares | 1,907,861 | ||
Payment for repurchase of common stock | $ 25.2 |
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