Investment in Unconsolidated Joint Ventures

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements [Abstract]

Investment in Unconsolidated Joint Ventures

Note G - Investment in Unconsolidated Joint Ventures

In addition to the 69 office and parking properties included in the consolidated financial statements, the Company is also invested in two unconsolidated joint ventures with unrelated investors. These investments are accounted for using the equity method of accounting, as Parkway does not control any of these joint ventures. Accordingly, the assets and liabilities of the joint ventures are not included on Parkway's consolidated balance sheets at June 30, 2011 and December 31, 2010. Information relating to these unconsolidated joint ventures is detailed below (in thousands).

			Parkway's
			Ownership	Square	Percentage
Joint Venture Entity	Property Name	Location	Interest	Feet	Leased
Parkway Joint Venture, LLC ("Jackson JV")	UBS Building/River Oaks	Jackson, MS	20.0%	167	83.8%
RubiconPark II, LLC ("Maitland JV")	Maitland 200	Orlando, FL	20.0%	205	95.7%
				372	90.4%

Cash distributions from unconsolidated joint ventures are made to each partner based on their percentage of ownership in each entity. Cash distributions made to partners in joint ventures where the percentage of debt assumed is disproportionate to the ownership percentage in the venture is distributed based on each partner's share of cash available for distribution before debt service, based on their ownership percentage, less the partner's share of debt service based on the percentage of debt assumed by each partner.

Parkway provides management, construction and leasing services for all of the unconsolidated joint ventures and receives market based fees for these services. The Company recognizes its share of fees earned from unconsolidated joint ventures in management company income.

At June 30, 2011 and December 31, 2010, the Company's investment in unconsolidated joint ventures was $1.8 million or 0.1% of total assets and $2.9 million or 0.2% of total assets, respectively.

On February 4, 2011, the Company purchased its partner's 50% interest in the Wink JV for $250,000. The Wink JV was established for the purpose of owning the Wink Building, a 32,000 square foot office property in New Orleans, Louisiana. Upon completing the purchase of its partner's interest, Parkway now owns 100% of the Wink Building.

On July 6, 2011, RubiconPark II, LLC, sold Maitland 200 for a gross sale price of $23.0 million. Maitland 200 is a 204,000 square foot office property located in the Maitland submarket of Orlando. The $16.9 million mortgage loan secured by the property was repaid upon closing. Parkway owned a 20% interest in the property and received a priority distribution after the repayment of secured debt of approximately $2.8 million, which was used to reduce amounts outstanding under the Company's credit facility. The Company estimates that it will recognize a gain on the sale of approximately $690,000 during the third quarter of 2011. Parkway Realty Services, LLC, a subsidiary of the Company, will continue to provide management services and receive management fee income for the property.

The Company's share of debt related to its unconsolidated joint venture is the same as its ownership percentage in the venture. The terms related to Parkway's share of unconsolidated joint venture mortgage debt are summarized below for June 30, 2011 and December 31, 2010 (in thousands):

				Parkway's		Monthly		Loan		Loan
	Type of	Interest		Share		Debt		Balance		Balance
Description	Debt Service	Rate	Maturity	of Debt		Service		6/30/11		12/31/10
Jackson JV	Amortizing	5.84%	07/01/15	20.00%	$	12	$	2,457	$	2,474
					$	12	$	2,457	$	2,474
								5.84%		5.84%

Parkway's share of the scheduled principal payments on mortgage debt at June 30, 2011, for the unconsolidated joint ventures for each of the next five years through maturity are as follows (in thousands):

Schedule of Mortgage Maturities by Year:		Jackson JV
2011 (remaining six months)	$	17
2012		37
2013		39
2014		41
2015		2,323
	$	2,457

- Definition

Equity investment disclosure, or group of investments for which combined disclosure is appropriate, including: (a) the name of each investee and percentage of ownership of common stock, (b) accounting policies for investments in common stock, (c) difference between the amount at which the investment is carried and the amount of underlying equity in net assets and the accounting treatment of the difference, (d) the total fair value of each identified investment for which a market value is available, (e) summarized information as to assets, liabilities, and results of operations of the investees (for investments in unconsolidated subsidiaries, common stock of joint ventures, or other investments using the equity method), and (f) material effects of possible conversions, exercises, or contingent issuances of the investee. Other disclosures include (a) the names of any investee in which the investor owns 20 percent or more of the voting stock and investment is not accounted for using the equity method, and the reasons why not, and (b) the names of any investee in which the investor owns less than 20% of the voting stock and the investment is accounted for using the equity method, and the reasons why it is.

+ References+ Details