Segments Disclosure

9 Months Ended

Sep. 30, 2015

Segment Reporting [Abstract]

Segments Disclosure

19. Segments Disclosure

The Company

Upon completion of the Offering and Formation Transactions, we acquired substantially all of the assets of our Predecessor and substantially all of the assets of the Property Funds that it controlled. Our business, following the Formation Transactions, is comprised of one reportable segment. We have determined that our properties have similar economic characteristics to be aggregated into one reportable segment (operating, leasing and managing office properties). Our determination was based, in part, on our method of internal reporting.

The following tables provide selected results for each reportable segment for the three and nine months ended September 30, 2015 and 2014.

	For the Three Months Ended September 30, 2015
	Owned
(Amounts in thousands)	Properties			Other			Total
Income Statement Data:
Revenues
Rental income	$	145,711		$	759		$	146,470
Tenant reimbursement income		14,405			-			14,405
Fee and other income		4,767			2,084			6,851
Total revenues		164,883			2,843			167,726
Total expenses		134,667			6,492			141,159
Operating income (loss)		30,216			(3,649	)		26,567
Income from real estate fund investments		-			10,933			10,933
Income from unconsolidated joint ventures		1,433			25			1,458
Unrealized gains on interest rate swaps		15,772			-			15,772
Interest and other (loss) income, net		119			(1,882	)		(1,763	)
Interest and debt expense		(41,811	)		(1,010	)		(42,821	)
Net income before income taxes		5,729			4,417			10,146
Income tax (expense) benefit		275			(1,064	)		(789	)
Net income		6,004			3,353			9,357
Add:
Depreciation and amortization		70,366			288			70,654
General and administrative		-			6,666			6,666
Interest and debt expense		41,811			1,010			42,821
Acquisition and transaction related costs		-			485			485
Income tax (expense) benefit		(275	)		1,064			789
Net Operating Income from unconsolidated joint ventures		4,210			93			4,303
Less:
Income from real estate fund investments		-			(10,933	)		(10,933	)
Income from unconsolidated joint ventures		(1,433	)		(25	)		(1,458	)
Fee income		-			(2,085	)		(2,085	)
Unrealized gains on interest rate swaps		(15,772	)		-			(15,772	)
Interest and other (loss) income, net		(119	)		1,882			1,763
Net Operating Income (1)	$	104,792		$	1,798		$	106,590

	For the Nine Months Ended September 30, 2015
	Owned
(Amounts in thousands)	Properties			Other			Total
Income Statement Data:
Revenues
Rental income	$	433,537		$	2,093		$	435,630
Tenant reimbursement income		39,956			-			39,956
Fee and other income		10,890			5,404			16,294
Total revenues		484,383			7,497			491,880
Total expenses		408,319			36,602			444,921
Operating income (loss)		76,064			(29,105	)		46,959
Income from real estate fund investments		-			30,226			30,226
Income from unconsolidated joint ventures		4,358			86			4,444
Unrealized gains on interest rate swaps		49,497			-			49,497
Interest and other (loss) income, net		304			(701	)		(397	)
Interest and debt expense		(120,684	)		(6,261	)		(126,945	)
Net income (loss) before income taxes		9,539			(5,755	)		3,784
Income tax (expense) benefit		282			(2,988	)		(2,706	)
Net income (loss)		9,821			(8,743	)		1,078
Add:
Depreciation and amortization		222,822			836			223,658
General and administrative		-			28,412			28,412
Interest and debt expense		120,684			6,261			126,945
Transfer taxes due in connection with the sale of shares
by a former joint venture partner		-			5,872			5,872
Acquisition and transaction related costs		-			3,960			3,960
Income tax (expense) benefit		(282	)		2,988			2,706
Net Operating Income from unconsolidated joint ventures		12,084			278			12,362
Less:
Income from real estate fund investments		-			(30,226	)		(30,226	)
Income from unconsolidated joint ventures		(4,358	)		(86	)		(4,444	)
Fee income		-			(5,400	)		(5,400	)
Unrealized gains on interest rate swaps		(49,497	)		-			(49,497	)
Interest and other (loss) income, net		(304	)		701			397
Net Operating Income (1)	$	310,970		$	4,853		$	315,823

⁽¹⁾  Net Operating Income (“NOI”) is a metric used to measure the operating performance of a property. NOI consists of property-related revenue (which includes rental revenue, tenant reimbursement income and certain other income) less operating expenses (which includes building expenses such as cleaning, security, repairs and maintenance, utilities, property administration and real estate taxes). We use NOI internally as a performance measure and believe it provides useful information to investors regarding our financial condition and results of operations because it reflects only those income and expense items that are incurred at the property level. Other real estate companies may use different methodologies for calculating NOI, and accordingly, our presentation of NOI may not be comparable to other real estate companies.

The Predecessor

Our Predecessor historically operated an integrated business that consisted of three reportable segments, (i) Owned Properties, (ii) Managed Funds and (iii) a Management Company. The Owned Properties segment consisted of properties in which our Predecessor had a direct or indirect ownership interest, other than properties that it owned through its private equity real estate funds. The Managed Funds segment consisted of the private equity real estate funds. In addition, our Predecessor included a Management Company that performed property management and asset management services and certain general and administrative level functions, including legal and accounting, as a separate reportable segment.   

	For the Three Months Ended September 30, 2014
	Owned			Managed			Management
(Amounts in thousands)	Properties			Funds			Company			Eliminations			Total
Income Statement Data:
Revenues
Rental income	$	7,765		$	1,010		$	-		$	-		$	8,775
Tenant reimbursement income		370			-			-			-			370
Distributions from real estate fund investments		-			5,086			-			-			5,086
Realized and unrealized gains, net		-			43,233			-			-			43,233
Fee and other income		-			-			21,976			(8,048	)		13,928
Total revenues		8,135			49,329			21,976			(8,048	)		71,392
Total expenses		6,511			8,107			11,136			(8,048	)		17,706
Operating income		1,624			41,222			10,840			-			53,686
Income from unconsolidated joint ventures		1,777			-			17,726			(17,726	)		1,777
Unrealized loss on interest rate swaps		-			(477	)		-			-			(477	)
Interest and other income, net		(89	)		75			15			-			1
Interest and debt expense		(3,983	)		(4,032	)		-			-			(8,015	)
Net income (loss) before income taxes		(671	)		36,788			28,581			(17,726	)		46,972
Income tax expense		-			-			(820	)		-			(820	)
Net income (loss)		(671	)		36,788			27,761			(17,726	)		46,152
Net income attributable to noncontrolling interests		-			(33,248	)		-			-			(33,248	)
Net income (loss) attributable to the Predecessor	$	(671	)	$	3,540		$	27,761		$	(17,726	)	$	12,904

	For the Nine Months Ended September 30, 2014
	Owned			Managed			Management
(Amounts in thousands)	Properties			Funds			Company			Eliminations			Total
Income Statement Data:
Revenues
Rental income	$	23,229		$	1,858		$	-		$	-		$	25,087
Tenant reimbursement income		1,266			-			-			-			1,266
Distributions from real estate fund investments		-			16,333			-			-			16,333
Realized and unrealized gains, net		-			123,150			-			-			123,150
Fee and other income		-			-			49,886			(24,376	)		25,510
Total revenues		24,495			141,341			49,886			(24,376	)		191,346
Total expenses		20,013			25,108			34,861			(24,376	)		55,606
Operating income		4,482			116,233			15,025			-			135,740
Income from unconsolidated joint ventures		3,812			-			43,584			(43,584	)		3,812
Unrealized loss on interest rate swaps		-			(673	)		-			-			(673	)
Interest and other income, net		1,258			431			18			-			1,707
Interest and debt expense		(11,648	)		(12,115	)		(39	)		-			(23,802	)
Net income (loss) before income taxes		(2,096	)		103,876			58,588			(43,584	)		116,784
Income tax expense		-			-			(7,925	)		-			(7,925	)
Net income (loss)		(2,096	)		103,876			50,663			(43,584	)		108,859
Net income attributable to noncontrolling interests		-			(86,381	)		-			-			(86,381	)
Net income (loss) attributable to the Predecessor	$	(2,096	)	$	17,495		$	50,663		$	(43,584	)	$	22,478