Discontinued Operations (Tables)

6 Months Ended

Jun. 30, 2012

Disposition and properties held for sale

All current and prior period income from the following office property dispositions and properties held for sale is included in discontinued operations for the three months and six months ended June 30, 2012 and 2011 (in thousands).

Office Property	Location	Square Feet	Date of Sale		Net Sales Price		Net Book Value of Real Estate		Gain (Loss) on Sale
233 North Michigan	Chicago, IL	1,070	05/11/2011	$	156,546	$	152,254	$	4,292
Greenbrier I & II	Hampton Roads, VA	172	07/19/2011		16,275		15,070		1,205
Glen Forest	Richmond, VA	81	08/16/2011		8,950		7,880		1,070
Tower at Gervais	Columbia, SC	298	09/08/2011		18,421		18,421		-
Wells Fargo	Houston, TX	134	12/09/2011		-		-		-
Fund I Assets	Various	1,956	12/31/2011		256,823		250,699		11,258
2011 Dispositions (2)		3,711		$	457,015	$	444,324	$	17,825

Falls Pointe	Atlanta, GA	107	01/06/2012	$	5,824	$	4,467	$	1,357
111 East Wacker	Chicago, IL	1,013	01/09/2012		153,240		153,237		3
Renaissance Center	Memphis, TN	189	03/01/2012		27,661		24,629		3,032
Overlook II	Atlanta, GA	260	04/30/2012		29,467		28,689		778
Wink Building	New Orleans, LA	32	06/08/2012		705		803		(98)
Non-Core Assets	Various	1,745	Various		118,755		115,055		3,700
2012 Dispositions (3)		3,346		$	335,652	$	326,880	$	8,772

Office Property	Location	Square Feet	Date of Sale		Gross Sales Price
Properties Held for Sale and Expected to Close During Third Quarter 2012 (1)
Fund I Assets	Atlanta, GA	321	07/01/2012	$	29,850
111 Capitol Building (4)	Jackson, MS	187			-
Total Properties Held for Sale		508		$	29,850

(1) Gains on assets held for sale are expected to be finalized upon sale and reflected in third quarter 2012 financial statements.

(2) Total gain on the sale of real estate in discontinued operations recognized for the year ended December 31, 2011 was $17.8 million, of which $9.8 million was Parkway's proportionate share.

(3) Total gain on the sale of real estate in discontinued operations recognized during the six months ended June 30, 2012 was $8.8 million, of which $4.9 million was Parkway's proportionate share.

(4) During the six months ended June 30, 2012, the Company sold 14 of 15 non-core assets. The 14 assets sold include five assets in Richmond, four assets in Memphis and five assets in Jackson. The remaining asset that has not yet closed is 111 Capitol Building, in Jackson, Mississippi. The 111 Capitol Building is currently under contract to sell and is expected to close during the third quarter of 2012, subject to customary closing conditions.

At June 30, 2012, assets and liabilities related to assets held for sale represented three properties totaling 508,000 square feet. On July 1, 2012, two properties totaling 321,000 square feet were sold. The major classes of assets and liabilities classified as held for sale at June 30, 2012 are as follows (in thousands):

	June 30
	2012
Balance Sheet:
Investment property	$	36,261
Accumulated depreciation		(4,530)
Office property held for sale		31,731
Rents receivable and other assets		5,300
Intangible assets, net		171
Other assets held for sale		5,471
Total assets held for sale	$	37,202

Mortgage notes payable	$	29,597
Accounts payable and other liabilities		1,487
Total liabilities related to assets held for sale	$	31,084

The amount of revenues and expenses for these office properties reported in discontinued operations for the three months and six months ended June 30, 2012 and 2011 is as follows (in thousands):

		Three Months Ended June 30					Six Months Ended June 30
		2012		2011		2012			2011
Statement of Operations:
Revenues
Income from office and parking properties	$	2,693	$	36,257	$	12,060		$	75,755
		2,693		36,257		12,060			75,755

Expenses
Office and parking properties:
Operating expense		1,608		16,042		5,477			34,168
Management company expense		86		52		238			126
Interest expense		1,587		7,418		3,378			15,770
Non-cash adjustment for interest rate swap		(77)		-		(215)			-
Depreciation and amortization		153		15,130		593			30,982
Impairment loss		-		1,700		-			1,700
		3,357		40,342		9,471			82,746

Income (loss) from discontinued operations		(664)		(4,085)		2,589			(6,991)
Gain on sale of real estate from discontinued operations		3,197		4,292		8,772			4,292
Total discontinued operations per Statement of Operations		2,533		207		11,361			(2,699)
Net (income) loss attributable to noncontrolling interest from discontinued operations		(320)		1,754		(3,675)			3,530
Total discontinued operations-Parkway's share	$	2,213	$	1,961	$	7,686		$	831

- Definition

Tabular disclosure of disposal groups, which may include the gain (loss) recognized in the income statement and the income statement caption that includes that gain (loss), amounts of revenues and pretax profit or loss reported in discontinued operations, the classification and carrying value of the assets and liabilities comprising the disposal group, and the segment in which the disposal group was reported. Also may include the amount of adjustments to amounts previously reported in discontinued operations such as resolution of contingencies arising from the disposal transaction or the operations of the component prior to disposal.

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