Segment Information

3 Months Ended

Mar. 31, 2023

Segment Information

Segment Information

16.Segment Information

We review operating and financial data for each property on an individual basis; therefore, each of our individual properties is a separate operating segment. We define our reportable segments to be aligned with our method of internal reporting and the way our Chief Executive Officer, who is also our Chief Operating Decision Maker ("CODM"), makes key operating decisions, evaluates financial results, allocates resources and manages our business. Accordingly, we aggregate our operating segments into three reportable segments (multifamily, commercial, and third-party asset management and real estate services) based on the economic characteristics and nature of our assets and services.

The CODM measures and evaluates the performance of our operating segments, with the exception of the third-party asset management and real estate services business, based on the net operating income ("NOI") of properties within each segment. NOI includes property rental revenue and parking revenue, and deducts property operating expenses and real estate taxes.

With respect to the third-party asset management and real estate services business, the CODM reviews revenue streams generated by this segment ("Third-party real estate services, including reimbursements"), as well as the expenses attributable to the segment ("General and administrative: third-party real estate services"), which are both disclosed separately in our statements of operations. The following represents the components of revenue from our third-party asset management and real estate services business:

	Three Months Ended March 31,
	2023		2022
	(In thousands)
Property management fees	$	4,952	$	4,808
Asset management fees		1,103		1,771
Development fees		1,986		3,539
Leasing fees		1,356		1,839
Construction management fees		340		150
Other service revenue		1,224		816
Third-party real estate services revenue, excluding reimbursements		10,961		12,923
Reimbursement revenue (1)		11,823		11,047
Third-party real estate services revenue, including reimbursements		22,784		23,970
Third-party real estate services expenses		23,823		27,049
Third-party real estate services revenue less expenses	$	(1,039)	$	(3,079)

(1) Represents reimbursement of expenses incurred by us on behalf of third parties, including allocated payroll costs and amounts paid to third-party contractors for construction management projects.

Management company assets primarily consist of management and leasing contracts with a net book value of $12.2 million and $13.7 million as of March 31, 2023 and December 31, 2022, which were included in "Intangible assets, net" in our balance sheets. Consistent with internal reporting presented to our CODM and our definition of NOI, the third-party asset management and real estate services operating results are excluded from the NOI data below.

The following is the reconciliation of net income (loss) attributable to common shareholders to consolidated NOI:

	Three Months Ended March 31,
	2023		2022
	(in thousands)
Net income (loss) attributable to common shareholders	$	21,171	$	(32)
Add:
Depreciation and amortization expense		53,431		58,062
General and administrative expense:
Corporate and other		16,123		15,815
Third-party real estate services		23,823		27,049
Share-based compensation related to Formation Transaction and special equity awards		351		2,244
Transaction and other costs		2,472		899
Interest expense		26,842		16,278
Loss on the extinguishment of debt		—		591
Income tax benefit		(16)		(471)
Net income attributable to redeemable noncontrolling interests		3,363		10
Net loss attributable to noncontrolling interests		(224)		(55)
Less:
Third-party real estate services, including reimbursements revenue		22,784		23,970
Other revenue		1,726		2,196
Income from unconsolidated real estate ventures, net		433		3,145
Interest and other income, net		4,077		14,246
Gain (loss) on the sale of real estate, net		40,700		(136)
Consolidated NOI	$	77,616	$	76,969

The following is a summary of NOI by segment. Items classified in the Other column include development assets, corporate entities, land assets for which we are the ground lessor and the elimination of inter-segment activity.

	Three Months Ended March 31, 2023
	Commercial		Multifamily		Other		Total
	(In thousands)
Property rental revenue	$	71,917	$	49,910	$	2,206	$	124,033
Parking revenue		4,138		224		57		4,419
Total property revenue		76,055		50,134		2,263		128,452
Property expense:
Property operating		19,371		17,455		(1,214)		35,612
Real estate taxes		9,001		5,608		615		15,224
Total property expense		28,372		23,063		(599)		50,836
Consolidated NOI	$	47,683	$	27,071	$	2,862	$	77,616
	Three Months Ended March 31, 2022
	Commercial		Multifamily		Other		Total
	(In thousands)
Property rental revenue	$	87,621	$	42,108	$	1,869	$	131,598
Parking revenue		4,012		134		55		4,201
Total property revenue		91,633		42,242		1,924		135,799
Property expense:
Property operating		26,202		13,755		687		40,644
Real estate taxes		11,777		5,221		1,188		18,186
Total property expense		37,979		18,976		1,875		58,830
Consolidated NOI	$	53,654	$	23,266	$	49	$	76,969

The following is a summary of certain balance sheet data by segment:

	Commercial		Multifamily		Other		Total
	(In thousands)
March 31, 2023
Real estate, at cost	$	2,567,810	$	3,055,495	$	419,938	$	6,043,243
Investments in unconsolidated real estate ventures		229,642		—		83,009		312,651
Total assets		2,507,262		2,444,022		883,736		5,835,020
December 31, 2022
Real estate, at cost	$	2,754,832	$	2,986,907	$	416,343	$	6,158,082
Investments in unconsolidated real estate ventures		218,723		304		80,854		299,881
Total assets		2,829,576		2,483,902		589,960		5,903,438