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Fair Value Measurements
 6 Months Ended
Jul. 31, 2012
Fair Value Disclosures [Abstract]  
Fair Value Measurements
Fair Value Measurements
The Company’s financial assets and liabilities subject to fair value measurements are interest rate caps, interest rate swap agreements, TRS and borrowings subject to TRS (see Note E—Derivative Instruments and Hedging Activities). The Company’s impairment of real estate and unconsolidated entities is also subject to fair value measurements (see Note I – Land Held for Divestiture, Note L –Impairment of Real Estate, Impairment of Unconsolidated Entities and Write-Off of Abandoned Development Projects and Note M – Discontinued Operations and Gain on Disposition of Rental Properties).
Financial Instruments Measured at Fair Value on a Recurring Basis
The Company’s financial assets consist of interest rate caps, interest rate swap agreements and TRS with positive fair values that are included in other assets. The Company’s financial liabilities consists of interest rate swap agreements and TRS with negative fair values that are included in accounts payable, accrued expenses and other liabilities and borrowings subject to TRS included in mortgage debt and notes payable, nonrecourse. The Company records the redeemable noncontrolling interest related to Brooklyn Arena, LLC at redemption value, which approximates fair value.
The following table presents information about the Company’s financial assets and liabilities and redeemable noncontrolling interest that were measured at fair value on a recurring basis, and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value.
 
Fair Value Measurements
 
July 31, 2012
 
Level 1
 
Level 2
 
Level 3
 
Total
 
(in thousands)
Interest rate caps
$
—

 
$
13

 
$
—

 
$
13

Interest rate swap agreements (positive fair value)
—

 
673

 
—

 
673

Interest rate swap agreements (negative fair value)
—

 
(4,863
)
 
(141,840
)
 
(146,703
)
TRS (positive fair value)
—

 
—

 
19,679

 
19,679

TRS (negative fair value)
—

 
—

 
(27,410
)
 
(27,410
)
Fair value adjustment to the borrowings subject to TRS
—

 
—

 
9,550

 
9,550

Redeemable noncontrolling interest
—

 
—

 
(232,107
)
 
(232,107
)
Total
$
—

 
$
(4,177
)
 
$
(372,128
)
 
$
(376,305
)
 
 
 
 
 
 
 
 
 
January 31, 2012
 
(in thousands)
Interest rate caps
$
—

 
$
13

 
$
—

 
$
13

Interest rate swap agreements (positive fair value)
—

 
1,083

 
—

 
1,083

Interest rate swap agreements (negative fair value)
—

 
(5,396
)
 
(143,303
)
 
(148,699
)
TRS (positive fair value)
—

 
—

 
10,308

 
10,308

TRS (negative fair value)
—

 
—

 
(25,321
)
 
(25,321
)
Fair value adjustment to the borrowings subject to TRS
—

 
—

 
9,180

 
9,180

Redeemable noncontrolling interest
—

 
—

 
(229,149
)
 
(229,149
)
Total
$
—

 
$
(4,300
)
 
$
(378,285
)
 
$
(382,585
)

The table below presents a reconciliation of all financial assets and liabilities and redeemable noncontrolling interest measured at fair value on a recurring basis using significant unobservable inputs (Level 3).
 
Fair Value Measurements
 
Redeemable
Noncontrolling
Interest
 
Interest Rate
Swaps
 
Net
TRS
 
Fair value
adjustment
to the borrowings
subject to TRS
 
Total TRS
Related
 
Total
 
(in thousands)
Six Months Ended July 31, 2012
 
 
 
 
 
 
 
 
 
 
 
Balance, February 1, 2012
$
(229,149
)
 
$
(143,303
)
 
$
(15,013
)
 
$
9,180

 
$
(5,833
)
 
$
(378,285
)
Loss attributable to redeemable noncontrolling interest
4,308

 
—

 
—

 
—

 
—

 
4,308

Total realized and unrealized gains (losses):
 
 
 
 
 
 
 
 
 
 
 
Included in earnings
—

 
—

 
7,282

 
370

 
7,652

 
7,652

Included in other comprehensive income
—

 
1,463

 
—

 
—

 
—

 
1,463

Included in additional paid-in capital
(7,266
)
 
—

 
—

 
—

 
—

 
(7,266
)
Balance, July 31, 2012
$
(232,107
)
 
$
(141,840
)
 
$
(7,731
)
 
$
9,550

 
$
1,819

 
$
(372,128
)
Six Months Ended July 31, 2011
 
 
 
 
 
 
 
 
 
 
 
Balance, February 1, 2011
$
(226,829
)
 
$
(102,387
)
 
$
(30,034
)
 
$
21,938

 
$
(8,096
)
 
$
(337,312
)
Loss attributable to redeemable noncontrolling interest
1,879

 
—

 
—

 
—

 
—

 
1,879

Total realized and unrealized gains (losses):
 
 
 
 
 
 
 
 
 
 
 
Included in earnings
—

 
—

 
8,918

 
(7,464
)
 
1,454

 
1,454

Included in other comprehensive income
—

 
(19,072
)
 
—

 
—

 
—

 
(19,072
)
Included in additional paid-in capital
(1,986
)
 
—

 
—

 
—

 
—

 
(1,986
)
Settlement
—

 
—

 
903

 
(903
)
 
$
—

 
$
—

Balance, July 31, 2011
$
(226,936
)
 
$
(121,459
)
 
$
(20,213
)
 
$
13,571

 
$
(6,642
)
 
$
(355,037
)

The following table presents quantitative information about the significant unobservable inputs used to estimate the fair value of financial instruments measured on a recurring basis as of July 31, 2012.
 
Quantitative Information about Level 3 Fair Value  Measurements
 
Fair Value
July 31, 2012
 
Valuation
Technique
 
Unobservable
Input
 
Range of
Input Values
 
(in thousands)
 
 
 
 
 
 
Credit valuation adjustment of interest rate swap
$
15,082

 
Potential future exposure
 
Credit spreads
 
2.65(1) - 4.25%
TRS
$
(7,731
)
 
Third party bond pricing
 
Bond quote
 
84.41 - 106.02(1)
Fair value adjustment to the borrowings subject to TRS
$
9,550

 
Third party bond pricing
 
Bond quote
 
84.41 - 100.81(1)
Redeemable noncontrolling interest
$
(232,107
)
 
Discounted cash flows
 
Discount rate
 
9.7%
(1)
This fair value measurement was developed by third party service providers, subject to the Company’s corroboration for reasonableness.
Third party service providers involved in fair value measurements are evaluated for competency and qualifications on an ongoing basis. Internally developed fair value measurements, including unobservable inputs, are evaluated for reasonableness based on current transactions and experience in the real estate and capital markets.
The Company does not deem the impact of changes in unobservable inputs used to determine the fair market value of the credit valuation adjustment, TRS and fair value adjustment to the borrowings subject to TRS to be significant; however, changes in the discount rate used to determine the fair market value of the redeemable noncontrolling interest could have a significant impact on its fair market value.
Fair Value of Other Financial Instruments
The carrying amount of notes and accounts receivable and accounts payable, accrued expenses and other liabilities approximates fair value based upon the short-term nature of the instruments. The Company estimates the fair value of its debt instruments by discounting future cash payments at interest rates that the Company believes approximate the current market. Estimated fair value is based upon market prices of public debt, available industry financing data, current treasury rates and recent financing transactions. The fair value of the Company’s debt instruments is classified as Level 2 in the fair value hierarchy.
The following table summarizes the fair value of nonrecourse mortgage debt and notes payable, bank revolving facility, senior and subordinated debt and nonrecourse mortgage debt and notes payable of land held for divestiture and operating properties held for sale: 
 
July 31, 2012
 
January 31, 2012
 
Carrying Value
 
Fair Value
 
Carrying Value
 
Fair Value
 
(in thousands)
Fixed Rate Debt
$
4,885,611

 
$
5,240,346

 
$
4,458,214

 
$
4,719,636

Variable Rate Debt
2,061,413

 
2,142,959

 
2,239,838

 
2,341,862

Total
$
6,947,024

 
$
7,383,305

 
$
6,698,052

 
$
7,061,498