Property And Equipment

3 Months Ended

Mar. 31, 2015

Note 6 – Property and Equipment

Operating Property, net

As of March 31, 2015 and December 31, 2014, property associated with our operating activities is summarized as follows (dollars in thousands):



		March 31,		December 31,
Operating Property		2015		2014
Land	$	60,851	$	62,024
Building and improvements		114,785		120,913
Leasehold interests		52,240		51,494
Fixtures and equipment		102,161		107,286
Total cost		330,037		341,717
Less: accumulated depreciation		(151,615)		(154,828)
Operating property, net	$	178,422	$	186,889

Depreciation expense for operating property was $3.5 million for the three months ended March 31, 2015 and $3.5 million for the three months ended March 31, 2014.

Land Held for Sale – Moonee Ponds

On October 15, 2013, we entered into a definitive purchase and sale agreement to sell this property for a sale price of $17.5 million (AUS$23.0 million) payable in full upon closing of the transaction on April 16, 2015. The property has a book value of $9.4 million (AUS $12.4 million), and while the transaction was treated as a current sale for tax purposes, it does not qualify as a sale under US GAAP until the close of the transaction which occurred on April 16, 2015. As the scheduled closing date is less than one year away, this asset has been listed as a current asset in the accompanying consolidated balance sheet as at March 31, 2015.

Land Held for Sale – Burwood

On May 12, 2014, we entered into a contract to sell our undeveloped 50.6 acre parcel in Burwood, Victoria, Australia, to an affiliate of Australand Holdings Limited for a purchase price of $49.6 million (AUS$65.0 million).

We received $5.9 million (AUS$6.5 million) on the May 23, 2014 closing. The balance of the purchase price is due on December 31, 2017. The agreement provides for mandatory pre-payments in the event that any of the land is sold by the buyer, any such prepayment being in an amount equal to the greater of (a) 90% of the net sale price or (b) the balance of the purchase price multiplied by a fraction the numerator of which is the square footage of property being sold by the buyer and the denominator of which is the original square footage of the property being sold to the buyer. The agreement does not provide for the payment of interest on the balance owed.

Our book value in the property is $39.7 million (AUS$52.1 million) and while the transaction was treated as a current sale for tax purposes, it does not qualify as a sale under US GAAP until the receipt of the payment of the balance of the purchase price due on December 31, 2017 (or earlier depending upon whether any prepayment obligation is triggered). The asset has been listed as a long term asset.

Investment and Development Property

As of March 31, 2015 and December 31, 2014, our investment and development property is summarized as follows (dollars in thousands):



		March 31,		December 31,
Investment and Development Property		2015		2014
Land	$	22,998	$	23,833
Construction-in-progress (including capitalized interest)		2,200		2,291
Investment and development property	$	25,198	$	26,124