NONCONTROLLING INTERESTS

Redeemable Noncontrolling Interests in the Operating Partnership

Interests in the Operating Partnership held by limited partners are represented by OP Units. The income is allocated to holders of OP Units based upon net income attributable to common stockholders and the weighted average number of OP Units outstanding to total common shares plus OP Units outstanding during the period. Capital contributions, distributions, and profits and losses are allocated to noncontrolling interests in accordance with the terms of the individual partnership agreements.

Limited partners have the right to require the Operating Partnership to redeem all or a portion of the OP Units held by the limited partner at a redemption price equal to and in the form of the Cash Amount as defined in the Amended and Restated Agreement of Limited Partnership of the Operating Partnership (the “Operating Partnership Agreement”), provided that such OP Units have been outstanding for at least one year. UDR, as the general partner of the Operating Partnership may, in its sole discretion, purchase the OP Units by paying to the limited partner either the Cash Amount or the REIT Share Amount (generally one share of common stock of the Company for each OP Unit), as defined in the Operating Partnership Agreement. Accordingly, the Company records the OP Units outside of permanent equity and reports the OP Units at their redemption value using the Company’s stock price at each balance sheet date.

The following table sets forth redeemable noncontrolling interests in the Operating Partnership for the years ended December 31, 2014 and 2013 (dollars in thousands):



	Year Ended December 31,
	2014			2013
Redeemable noncontrolling interests in the Operating Partnership, beginning of year	$	217,597		$	223,418
Mark-to-market adjustment to redeemable noncontrolling interests in the Operating Partnership	73,954			3,656
Conversion of OP Units to Common Stock	(4,372		)	(1,817		)
Net income/(loss) attributable to redeemable noncontrolling interests in the Operating Partnership	5,511			1,530
Distributions to redeemable noncontrolling interests in the Operating Partnership	(10,077		)	(9,440		)
Allocation of other comprehensive income/(loss)	(133		)	250
Redeemable noncontrolling interests in the Operating Partnership, end of year	$	282,480		$	217,597

The following sets forth net income/(loss) attributable to common stockholders and transfers from redeemable noncontrolling interests in the Operating Partnership for the following periods (dollars in thousands):



	Year Ended December 31,
	2014		2013		2012
Net income/(loss) attributable to common stockholders	$	150,610	$	41,088	$	203,376
Conversion of OP units to UDR Common Stock	4,372		1,817		529
Change in equity from net income/(loss) attributable to common stockholders and conversion of OP units to UDR Common Stock	$	154,982	$	42,905	$	203,905

Noncontrolling Interests

Noncontrolling interests represent interests of unrelated partners in certain consolidated affiliates, and is presented as part of equity in the Consolidated Balance Sheets since these interests are not redeemable. During the years ended December 31, 2014, 2013, and 2012, net (income)/loss attributable to noncontrolling interests was $3,000, $60,000, and $(140,000), respectively.

During the year ended December 31, 2012, the Company acquired all of the noncontrolling interests in two consolidated affiliates for $4.9 million, one of which owns a 434 apartment home community for $4.0 million and the other is a development project for $900,000. See the “Consolidated Joint Ventures” section of Note 5, Unconsolidated Joint Ventures and Partnerships, for additional information on the consolidated development joint venture.