Discontinued Operations

12 Months Ended

Dec. 31, 2012

Discontinued Operations [Abstract]

Discontinued Operations

Note G - Discontinued Operations

All current and prior period income from the following office property dispositions are included in discontinued operations for the years ended December 31, 2012, 2011 and 2010 (in thousands).

Office Property	Location	Square Feet		Date of Sale	Net Sales Price		Net Book Value of Real Estate		Gain on Sale			Impairment Loss
One Park Ten	Houston, TX		163	04/15/2010	$	14,924	$	6,406	$	8,518		$	-
2010 Dispositions			163		$	14,924	$	6,406	$	8,518		$	-
													-
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 1301 Gervais (1)	Columbia, SC		298	09/08/2011		18,421		18,421		-			6,147
Wells Fargo	Houston, TX		134	12/09/2011		-		-		-			11,561
Fund I Assets	Various		1,956	12/31/2011		255,725		244,467		11,258			68,513
2011 Dispositions			3,711		$	455,917	$	438,092	$	17,825		$	86,221
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			19,050
Renaissance Center	Memphis, TN		189	03/01/2012		27,661		24,629		3,032			9,200
Non-Core Assets (2)	Various		1,932	Various		125,486		122,157		3,329			51,889
Overlook II	Atlanta, GA		260	04/30/2012		29,467		28,689		778			10,500
Wink	New Orleans, LA		32	06/08/2012		705		803		(98	)		-
Ashford Center/ Peachtree Ridge	Atlanta, GA		321	07/01/2012		29,440		28,148		1,292			17,200
Sugar Grove	Houston, TX		124	10/23/2012		10,303		7,057		3,246			-
2012 Dispositions			3,978		$	382,126	$	369,187	$	12,939		$	107,839
(1)	During 2010 and 2011, the Company recognized non-cash impairment losses on this property of $3.4 million and $2.7 million, respectively.
(2)	During 2010 and 2011, the Company recognized non-cash impairment losses associated with these properties of $640,000 and $51.2 million, respectively.

During 2012, the Company completed its previously disclosed dispositions as part of its strategic objective of becoming a leading owner of high-quality office assets in higher growth markets in the Sunbelt region of the United States.  As previously disclosed, the Company entered into an agreement to sell its interest in 13 office properties totaling 2.7 million square feet owned by Parkway Properties Office Fund, L.P. ("Fund I") to its existing partner in the fund for a gross sales price of $344.3 million.  As of December 31, 2011, Parkway had completed the sale of 9 of these 13 assets.  During the year ended December 31, 2012, the Company completed the sale of the remaining four Fund I assets totaling 770,000 square feet.  Accordingly, income from all Fund I properties has been classified as discontinued operations for all current and prior periods.  These Fund I assets were secured by a total of $292.0 million in mortgage loans, of which $82.4 million was Parkway's share, with a weighted average interest rate of 5.6% that were assumed by the buyer upon closing.  Parkway received net proceeds from the sales of the Fund I assets of $14.2 million, which were used to reduce amounts outstanding under the Company's credit facilities.

Additionally, during the year ended December 31, 2012, the Company completed the sale of the 15 properties included in its strategic sale of a portfolio of non-core assets, for a gross sales price of $147.7 million and generating net proceeds to Parkway of approximately $94.3 million, with the buyer assuming $41.7 million in mortgage loans upon sale, of which $31.9 million was Parkway's share.  The 15 assets that were sold include five assets in Richmond, four assets in Memphis, and six assets in Jackson.  Income from these non-core assets has been classified as discontinued operations for all current and prior periods.

The Company completed the sale of four additional assets during the year ended December 31, 2012, including the sale of 111 East Wacker, a 1.0 million square foot office property located in Chicago, the Wink building, a 32,000 square foot office property in New Orleans, Louisiana, Sugar Grove, a 124,000 square foot office property in Houston, Texas, and Falls Pointe, a 107,000 square foot office property located in Atlanta and owned by Parkway Properties Office Fund II, L.P. ("Fund II") for a gross sales price of $168.8 million.  Parkway received approximately $14.8 million in net proceeds from these sales, which were used to reduce amounts outstanding under the Company's revolving credit facility and to fund subsequent acquisitions.  In connection with the sale of 111 East Wacker, the buyer assumed a $147.9 million mortgage loan upon sale.  Income from 111 East Wacker, the Wink building, Sugar Grove and Falls Pointe has been classified as discontinued operations for all current and prior periods.

The amount of revenues and expenses for these office properties reported in discontinued operations for the years ended December 31, 2012, 2011 and 2010 is as follows (in thousands):

	Year Ended December 31
	2012			2011			2010
Statement of Operations:
Revenues
Income from office and parking properties	$	13,752		$	135,964		$	162,057
		13,752			135,964			162,057
Expenses
Office and parking properties:
Operating expenses		6,525			61,424			69,930
Management company expense		350			288			380
Interest expense		5,199			29,794			34,693
Gain on extinguishment of debt		(1,494	)		(7,635	)		-
Non-cash expense on interest rate swap		(215	)		2,338			-
Depreciation and amortization		933			54,628			63,815
Impairment loss		-			189,940			4,120
		11,298			330,777			172,938
Income (loss) from discontinued operations		2,454			(194,813	)		(10,881	)
Gain on sale of real estate from discontinued operations		12,939			17,825			8,518
Total discontinued operations per Statement of Operations		15,393			(176,988	)		(2,363	)
Net income (loss) attributable to noncontrolling interest from discontinued operations		(4,184	)		75,836			7,221
Total discontinued operations – Parkway's Share	$	11,209		$	(101,152	)	$	4,858