Investments in Unconsolidated Real Estate Ventures (Tables)

12 Months Ended

Dec. 31, 2024

Investments in Unconsolidated Real Estate Ventures.

Schedule of unconsolidated investments

The following is a summary of the composition of our investments in unconsolidated real estate ventures:

	Effective
	Ownership	December 31,
Real Estate Venture	Interest (1)	2024		2023
		(In thousands)
J.P. Morgan Global Alternatives ("J.P. Morgan") (2)	50.0%	$	74,188	$	72,742
4747 Bethesda Venture	20.0%		10,813		13,118
Brandywine Realty Trust (3)	30.0%		6,954		13,681
Prudential Global Investment Management ("PGIM") (4)	50.0%		678		163,375
Landmark Partners ("Landmark") (5)	18.0%		552		605
CBREI Venture (6)	10.0%		169		180
Other			300		580
Total investments in unconsolidated real estate ventures (7) (8)		$	93,654	$	264,281

(1) Reflects our effective ownership interests in the underlying real estate as of December 31, 2024. We have multiple investments with certain venture partners in the underlying real estate.

(2) J.P. Morgan is the advisor for an institutional investor.

(3) Impairment losses of $6.7 million related to development parcels were included in "Loss from unconsolidated real estate ventures, net" in our consolidated statement of operations for the year ended December 31, 2024.

(4) An impairment loss of $25.3 million related to Central Place Tower was included in "Loss from unconsolidated real estate ventures, net" in our consolidated statement of operations for the year ended December 31, 2023. In February 2024, the venture sold its interest in Central Place Tower.

(5) In November 2023, the venture sold its interest in Rosslyn Gateway-North, Rosslyn Gateway-South, Rosslyn Gateway-South Land and Rosslyn Gateway-North Land ("Rosslyn Gateway"). Impairment losses totaling $19.3 million related to the L'Enfant Plaza assets and the Rosslyn Gateway assets were included in "Loss from unconsolidated real estate ventures, net" in our consolidated statement of operations for the year ended December 31, 2022. Excludes the L'Enfant Plaza assets for which we had a zero-investment balance and discontinued applying the equity method of accounting after September 30, 2022. In October 2024, the lender foreclosed on the mortgage loan secured by the L’Enfant Plaza assets and took possession of the properties.

(6) In August 2023, the venture sold its interest in Stonebridge at Potomac Town Center. An impairment loss of $3.3 million related to The Foundry was included in "Loss from unconsolidated real estate ventures, net" in our consolidated statement of operations for the year ended December 31, 2023. Excludes The Foundry for which we had a zero-investment balance and discontinued applying the equity method of accounting after September 30, 2023. In April 2024, the lender foreclosed on the mortgage loan secured by The Foundry and took possession of the property. In August 2022, we acquired the remaining 36.0% ownership interest in Atlantic Plumbing, an asset previously owned by the venture. See Note 3 for additional information.

(7) Excludes (i) 10.0% subordinated interest in one commercial building, (ii) the Fortress Assets, (iii) the L'Enfant Plaza assets and (iv) The Foundry. Also, excludes our interest in an investment in the real estate venture that owns 1101 17th Street for which we have discontinued applying the equity method of accounting since June 30, 2018 because we received distributions in excess of our contributions and share of earnings, which reduced our investment to zero; further, we are not obligated to provide for losses, have not guaranteed its obligations or otherwise committed to provide financial support.

(8) As of December 31, 2024 and 2023, our total investments in unconsolidated real estate ventures were greater than our share of the net book value of the underlying assets by $10.6 million and $8.7 million, resulting principally from our zero-investment balance in certain real estate ventures and capitalized interest.

The following is a summary of the debt of our unconsolidated real estate ventures:

	Weighted
	Average Effective	December 31,
	Interest Rate (1)	2024		2023
		(In thousands)
Variable rate (2)	5.68%	$	175,000	$	175,000
Fixed rate (3)	4.13%		60,000		60,000
Mortgage loans (4)			235,000		235,000
Unamortized deferred financing costs and premium / discount, net			(5,795)		(8,531)
Mortgage loans, net (4) (5)		$	229,205	$	226,469

(1) Weighted average effective interest rate as of December 31, 2024.

(2) Includes variable rate mortgage loans with interest rate cap agreements.

(3) Includes variable rate mortgage loans with interest rates fixed by interest rate swap agreements.

(4) Excludes mortgage loans related to the Fortress Assets, the L'Enfant Plaza assets and The Foundry. In April 2024, the lender foreclosed on the mortgage loan secured by The Foundry and took possession of the property. In October 2024, the lender foreclosed on the mortgage loan secured by the L’Enfant Plaza assets and took possession of the properties.

(5) See Note 21 for additional information on guarantees related to our unconsolidated real estate ventures.

	December 31,
	2024		2023
	(In thousands)
Combined balance sheet information: (1)
Real estate, net	$	424,170	$	729,791
Other assets, net		64,478		137,771
Total assets	$	488,648	$	867,562
Mortgage loans, net	$	229,205	$	226,469
Other liabilities, net		27,019		47,251
Total liabilities		256,224		273,720
Total equity		232,424		593,842
Total liabilities and equity	$	488,648	$	867,562

	Year Ended December 31,
	2024		2023		2022
	(In thousands)
Combined income statement information: (1)
Total revenue	$	37,219	$	85,280	$	143,665
Operating income (loss) (2)		(14,195)		(62,668)		91,473
Net income (loss) (2)		(30,041)		(85,551)		59,215

(1) Excludes amounts related to the Fortress Assets. Excludes combined balance sheet information for both periods presented and combined income statement information for 2024, 2023 and the fourth quarter of 2022 related to the L'Enfant Plaza assets as we discontinued applying the equity method of accounting after September 30, 2022. Excludes combined balance sheet information for both periods presented and combined income statement information for 2024 and the fourth quarter of 2023 related to The Foundry as we discontinued applying the equity method of accounting after September 30, 2023.

(2) Includes the gain from the sale of various assets totaling $894,000, $3.0 million and $114.9 million for each of the three years in the period ended December 31, 2024. Includes impairment losses of $22.5 million, $80.7 million and $37.7 million for each of the three years in the period ended December 31, 2024.

Schedule of unconsolidated investments disposition activity

						Mortgage		Proportionate
	Real Estate			Gross		Loans		Share of
	Venture		Ownership	Sales		Repaid by		Aggregate
Date Disposed	Partner	Assets	Percentage	Price		Venture		Gain (Loss) (1)
				(Dollars in thousands)
Year Ended December 31, 2024
February 13, 2024	PGIM	Central Place Tower	50.0%	$	325,000	$	—	$	480
Year Ended December 31, 2023
August 24, 2023	CBREI Venture	Stonebridge at Potomac Town Center	10.0%	$	172,500	$	79,600	$	641
November 14, 2023	Landmark	Rosslyn Gateway	18.0%		52,000		44,844		(230)
								$	411
Year Ended December 31, 2022
January 27, 2022	Landmark	The Alaire, The Terano and 12511 Parklawn Drive	1.8% - 18.0%	$	137,500	$	79,829	$	5,243
May 10, 2022	Landmark	Galvan	1.8%		152,500		89,500		407
June 1, 2022	Canadian Pension Plan Investment Board	1900 N Street	55.0%		265,000		151,709		529
December 15, 2022	CBREI Venture	The Gale Eckington	5.0%		215,550		110,813		618
								$	6,797

(1) Included in "Loss from unconsolidated real estate ventures, net" in our consolidated statements of operations. Additionally, we recognized $3.8 million related to certain previously recorded contingent liabilities, which were relieved in connection with the sale of Central Place Tower and included in "Gain (loss) on the sale of real estate, net" in our consolidated statement of operations for the year ended December 31, 2024.