Real Estate Partnerships

6 Months Ended

Jun. 30, 2012

Equity Method Investments and Joint Ventures [Abstract]

REAL ESTATE PARTNERSHIPS

REAL ESTATE PARTNERSHIPS

Federal/Lion Venture LP

We have a joint venture arrangement (the “Partnership”) with affiliates of a discretionary fund created and advised by ING Clarion Partners (“Clarion”). We own 30% of the equity in the Partnership and Clarion owns 70%. We hold a general partnership interest, however, Clarion also holds a general partnership interest and has substantive participating rights. We cannot make significant decisions without Clarion’s approval. Accordingly, we account for our interest in the Partnership using the equity method. As of June 30, 2012, the Partnership owned seven retail real estate properties. We are the manager of the Partnership and its properties, earning fees for acquisitions, dispositions, management, leasing, and financing. Intercompany profit generated from fees is eliminated in consolidation. We also have the opportunity to receive performance-based earnings through our Partnership interest. Accounting policies for the Partnership are similar to accounting policies followed by the Trust. The Partnership is subject to a buy-sell provision which is customary for real estate joint venture agreements and the industry. Either partner may initiate this provision at any time, which could result in either the sale of our interest or the use of available cash or borrowings to acquire Clarion’s interest.

The following tables provide summarized operating results and the financial position of the Partnership:

	Three Months Ended June 30,				Six Months Ended June 30,
	2012		2011		2012		2011
	(In thousands)
OPERATING RESULTS
Revenue	$	4,709	$	4,676	$	9,298	$	9,644
Expenses
Other operating expenses	1,228		1,228		2,567		2,984
Depreciation and amortization	1,375		1,290		2,751		2,568
Interest expense	844		848		1,689		1,696
Total expenses	3,447		3,366		7,007		7,248
Net income	$	1,262	$	1,310	$	2,291	$	2,396
Our share of net income from real estate partnership	$	438	$	444	$	796	$	801

	June 30,		December 31,
	2012		2011
	(In thousands)
BALANCE SHEETS
Real estate, net	$	176,485	$	178,693
Cash	4,501		3,035
Other assets	5,003		6,116
Total assets	$	185,989	$	187,844
Mortgages payable	$	57,267	$	57,376
Other liabilities	4,434		5,391
Partners’ capital	124,288		125,077
Total liabilities and partners’ capital	$	185,989	$	187,844
Our share of unconsolidated debt	$	17,180	$	17,213
Our investment in real estate partnership	$	34,055	$	34,352

Taurus Newbury Street JV II Limited Partnership

On October 31, 2011, our Newbury Street Partnership sold its entire portfolio of three buildings for $44.0 million.  As part of the sale, we received $34.6 million of the net proceeds which included the repayment of our $11.8 million loans. Due to the timing of receiving financial information from the general partner, our share of earnings was recorded one quarter in arrears. Therefore, we recognized the gain on sale of $11.9 million in the first quarter 2012. The deferred gain was included in "other liabilities and deferred credits" on the balance sheet at December 31, 2011.