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SEGMENT INFORMATION
 6 Months Ended
Jun. 30, 2024
Segment Reporting [Abstract]  
SEGMENT INFORMATION
13. SEGMENT INFORMATION
As of June 30, 2024, the Company owns and manages properties within four segments: (1) Philadelphia Central Business District (“Philadelphia CBD”), (2) Pennsylvania Suburbs, (3) Austin, Texas and (4) Other. The Philadelphia CBD segment includes properties located in the City of Philadelphia, Pennsylvania. The Pennsylvania Suburbs segment includes properties in Chester, Delaware, and Montgomery counties in the Philadelphia suburbs. The Austin, Texas segment includes properties in the City of Austin, Texas. The Other segment includes properties located in the District of Columbia, Northern Virginia, Southern Maryland, Camden County, New Jersey and New Castle County, Delaware. In addition to the four segments, the corporate group is responsible for cash and investment management, development/redevelopment of certain real estate properties during the construction period, and certain other general support functions. Land held for development and construction in progress is transferred to operating properties by region upon completion of the associated construction or project.
The Company’s segments are based on the Company’s method of internal reporting, which classifies the Company's operations by geographic area. The following tables provide selected asset information and results of operations of the Company’s reportable segments (in thousands):
Real estate investments, at cost:
June 30, 2024December 31, 2023
Philadelphia CBD$1,537,436 $1,534,893 
Pennsylvania Suburbs899,767 900,230 
Austin, Texas798,195 801,973 
Total Core Segments3,235,398 3,237,096 
Other311,204 305,136 
Operating properties
$3,546,602 $3,542,232 
Corporate
Right of use asset - operating leases, net$18,720 $19,031 
Construction-in-progress$152,888 $135,529 
Land held for development$83,051 $82,510 
Prepaid leasehold interests in land held for development, net$27,762 $27,762 
Net operating income:
Three Months Ended June 30,
20242023
Total revenueOperating expenses (a)Net operating incomeTotal revenueOperating expenses (a)Net operating income
Philadelphia CBD$56,723 $(19,071)$37,652 $56,671 $(20,257)$36,414 
Pennsylvania Suburbs31,666 (9,897)21,769 32,102 (10,084)22,018 
Austin, Texas22,154 (8,834)13,320 23,781 (8,683)15,098 
Other10,308 (5,132)5,176 8,888 (4,850)4,038 
Corporate4,495 (3,380)1,115 4,440 (2,145)2,295 
Operating properties$125,346 $(46,314)$79,032 $125,882 $(46,019)$79,863 
Six Months Ended June 30,
20242023
Total revenueOperating expenses (a)Net operating incomeTotal revenueOperating expenses (a)Net operating income
Philadelphia CBD$112,711 $(38,953)$73,758 $112,898 $(40,843)$72,055 
Pennsylvania Suburbs63,685 (19,256)44,429 64,873 (19,863)45,010 
Austin, Texas45,409 (17,847)27,562 49,018 (19,977)29,041 
Other21,276 (10,594)10,682 18,277 (10,262)8,015 
Corporate8,749 (7,078)1,671 10,043 (5,909)4,134 
Operating properties$251,830 $(93,728)$158,102 $255,109 $(96,854)$158,255 
Includes property operating expenses, real estate taxes and third-party management expense.
Unconsolidated real estate ventures:
Investment in real estate ventures
Equity in income (loss) of real estate ventures
As ofThree Months Ended June 30,
June 30, 2024December 31, 202320242023
Philadelphia CBD$501,579 $450,136 $(10,223)$(4,412)
Metropolitan Washington, D.C.94,834 71,931 (941)(1,414)
Mid-Atlantic Office JV— — — 223 
MAP Venture— (48,733)(3,339)(1,995)
Austin, Texas83,723 79,160 (4)— 
Total$680,136 $552,494 $(14,507)$(7,598)
Net operating income (“NOI”) is a non-GAAP financial measure, which we define as total property revenue less property operating expenses, real estate taxes and third-party management expenses. Property operating expenses that are included in determining NOI consist of costs that are necessary and allocable to our operating properties such as utilities, property-level salaries, repairs and maintenance, property insurance and management fees. General and administrative expenses that are not reflected in NOI primarily consist of corporate-level salaries, amortization of share awards and professional fees that are incurred as part of corporate office management. NOI presented by the Company may not be comparable to NOI reported by other companies that define NOI differently. NOI is the primary measure that is used by the Company’s management to evaluate the operating performance of the Company’s real estate assets by segment. The Company believes NOI provides useful information to investors regarding the financial condition and results of operations because it reflects only those income and expense items that are incurred at the property level. While NOI is a relevant and widely used measure of operating performance of real estate investment trusts, it does not represent cash flow from operations or net income as defined by GAAP and should not be considered as an alternative to those measures in evaluating our liquidity or operating performance. NOI does not reflect interest expenses, real estate impairment losses, depreciation and amortization costs, capital expenditures and leasing costs. The Company believes that net income (loss), as defined by GAAP, is the most appropriate earnings measure. The following is a reconciliation of consolidated net income (loss), as defined by GAAP, to consolidated NOI, (in thousands):
Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
Net income (loss)$30,267 $(12,737)$13,853 $(18,013)
Plus:
Interest expense29,494 23,669 54,543 46,322 
Interest expense - amortization of deferred financing costs1,415 1,114 2,506 2,141 
Depreciation and amortization44,187 47,079 89,229 92,679 
General and administrative expenses8,941 9,360 20,045 18,842 
Equity in loss of unconsolidated real estate ventures14,507 7,598 28,095 13,765 
Provision for impairment6,427 4,468 6,427 4,468 
Gain on early extinguishment of debt(941)— (941)— 
Less:
Interest and investment income1,512 520 1,933 1,025 
Income tax provision(9)(13)(11)(38)
Net gain on sale of undepreciated real estate— — — 781 
Net gain on real estate venture transactions53,762 181 53,733 181 
Consolidated net operating income$79,032 $79,863 $158,102 $158,255