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Redeemable Noncontrolling Interests

12 Months Ended

Dec. 31, 2021

11. Redeemable Noncontrolling Interests

JBG SMITH LP

Op Units held by persons other than JBG SMITH are redeemable for cash or, at our election, our common shares, subject to certain limitations. Vested LTIP Units are redeemable into OP Units and, in turn cash or, at our election, our common shares, subject to certain limitations. During the years ended December 31, 2021 and 2020, unitholders redeemed 906,126 and 1.3 million OP Units and LTIP Units, which we elected to redeem for an equivalent number of our common shares. As of December 31, 2021, outstanding OP Units and redeemable LTIP Units totaled 14.9 million, representing a 10.5% ownership interest in JBG SMITH LP. In our consolidated balance sheets, our OP Units and certain vested LTIP Units are presented at the higher of their redemption value or their carrying value, with adjustments to the redemption value recognized in "Additional paid-in capital." Redemption value per OP Unit is equivalent to the market value of one of our common shares at the end of the period. In 2022, as of the date of this filing, unitholders redeemed 205,455 OP Units and LTIP Units, which we elected to redeem for an equivalent number of our common shares.

Consolidated Real Estate Venture

We are a partner in The Wren, a consolidated real estate venture that owns a multifamily asset located in Washington, D.C. Pursuant to the terms of the real estate venture agreement, we are obligated to fund all capital contributions until our ownership interest reaches a maximum of 97.0%. Our partner can redeem its interest for cash under certain conditions. As of December 31, 2021, we held a 96.0% ownership interest in the real estate venture.

The following is a summary of the activity of redeemable noncontrolling interests:


	Year Ended December 31,
	2021						2020
			Consolidated						Consolidated
	JBG		Real Estate				JBG		Real Estate
	SMITH LP		Venture		Total		SMITH LP		Venture		Total

	(In thousands)
Balance, beginning of period	$	522,882	$	7,866	$	530,748	$	606,699	$	6,059	$	612,758
OP Unit redemptions		(29,634)		—		(29,634)		(47,517)		—		(47,517)
LTIP Units issued in lieu of cash bonuses ⁽¹⁾		5,614		—		5,614		4,066		—		4,066
Net loss attributable to redeemable noncontrolling interests		(8,671)		(57)		(8,728)		(4,818)		(140)		(4,958)
Other comprehensive income (loss)		2,675		—		2,675		(2,990)		—		(2,990)
Distributions		(17,170)		(148)		(17,318)		(15,629)		—		(15,629)
Share-based compensation expense		47,222		—		47,222		64,611		—		64,611
Adjustment to redemption value		(9,650)		1,796		(7,854)		(81,540)		1,947		(79,593)
Balance, end of period	$	513,268	$	9,457	$	522,725	$	522,882	$	7,866	$	530,748

(1)	See Note 13 for additional information.