DISCONTINUED OPERATIONS

6 Months Ended

Jun. 30, 2013

DISCONTINUED OPERATIONS [Abstract]

DISCONTINUED OPERATIONS

NOTE 8. DISCONTINUED OPERATIONS

We apply the provisions of ASC Topic 360 “Property, Plant and Equipment”. ASC Topic 360 requires that long-lived assets that are to be disposed of by sale be measured at the lesser of (1) book value or (2) fair value less cost to sell. In addition, it requires that one accounting model be used for long-lived assets to be disposed of by sale and broadens the presentation of discontinued operations to include more disposal transactions.

Discontinued operations relates to properties that were either sold or held for sale as of the period ended June 30, 2013. Included in discontinued operations are a total of five and ten properties for 2013 and 2012, respectively. Properties sold in 2013 have been reclassified to discontinued operations for current and prior year reporting periods.  In 2013, we sold two apartment complexes (Laguna Vista and Verandas at City View) and three commercial properties (225 Baronne, Amoco, Eton Square).  In 2012, we sold two apartment complexes (Portofino and Wildflower Villas) and three commercial properties (305 Baronne, Clarke Garage and Dunes Plaza).  The gain on sale of the properties is also included in discontinued operations for those years.

The following table summarizes revenue and expense information for the properties sold and held for sale (dollars in thousands):

	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
	2013			2012			2013			2012
Revenue
Rental and other property revenues	$	1,258		$	3,456		$	3,768		$	7,850
Other income		20			943			20			939
		1,278			4,399			3,788			8,789
Expenses
Property operating expense		247			2,095			1,652			4,812
Interest expense		265			(290	)		878			1,904
Loan cost amortization		2			9			4			12
Loan fee expense		-			-			-			849
General and administrative		291			160			511			324
Depreciation and amortization		183			554			512			1,308
Earnings from unconsolidated joint ventures and investees		-			(56	)		-			(56	)
	$	988		$	2,472		$	3,557		$	9,153
Income (loss) from discontinued operations before gains on sale of real estate, taxes, and fees		290			1,927			231			(364	)
Gain on sale of discontinued operations		18,074			1,502			24,265			5,091
Income from discontinued operations	$	18,364		$	3,429		$	24,496		$	4,727
Income tax expense		(6,427	)		(1,200	)		(8,574	)		(1,654	)
Net income from discontinued operations	$	11,937		$	2,229		$	15,922		$	3,073

Our application of ASC Topic 360 results in the presentation of the net operating results of these qualifying properties sold or held for sale during 2012 as income from discontinued operations. This does not have an impact on net income available to common shareholders and only impacts the presentation of these properties within the Consolidated Statements of Operations.