13. PARTNERS’ EQUITY OF THE OPERATING PARTNERSHIP

Earnings per Common Partnership Unit

The following tables detail the number of units and net income used to calculate basic and diluted earnings per common partnership unit (in thousands, except unit and per unit amounts; results may not add due to rounding):

	Year ended December 31,
	2015						2014						2013
	Basic			Diluted			Basic			Diluted			Basic			Diluted
Numerator
Income (loss) from continuing operations	$	(30,740	)	$	(30,740	)	$	6,024		$	6,024		$	38,982		$	38,982
Nonforfeitable dividends allocated to unvested restricted unitholders		(329	)		(329	)		(349	)		(349	)		(363	)		(363	)
Preferred unit dividends		(6,900	)		(6,900	)		(6,900	)		(6,900	)		(6,900	)		(6,900	)
Net loss attributable to non-controlling interests		3			3			44			44			-			-
Income (loss) from continuing operations available to common unitholders		(37,966	)		(37,966	)		(1,181	)		(1,181	)		31,719			31,719
Discontinued operations attributable to common unitholders		-			-			918			918			4,207			4,207
Net income (loss) attributable to common unitholders	$	(37,966	)	$	(37,966	)	$	(263	)	$	(263	)	$	35,926		$	35,926
Denominator
Weighted-average units outstanding		179,697,262			179,697,262			167,942,246			167,942,246			154,929,545			154,929,545
Contingent securities/Share based compensation		-			-			-			-			-			1,273,853
Total weighted-average units outstanding		179,697,262			179,697,262			167,942,246			167,942,246			154,929,545			156,203,398
Earnings (loss) per Common Partnership Unit:
Income (loss) from continuing operations attributable to common unitholders		(0.21	)		(0.21	)		(0.01	)		(0.01	)		0.20			0.20
Discontinued operations attributable to common unitholders		-			-			0.01			0.01			0.03			0.03
Net income (loss) attributable to common unitholders	$	(0.21	)	$	(0.21	)	$	-		$	-		$	0.23		$	0.23

Unvested restricted units are considered participating securities which require the use of the two-class method for the computation of basic and diluted earnings per unit. For the years ended December 31, 2015, 2014 and 2013, earnings representing nonforfeitable dividends were allocated to the unvested restricted units issued to the Parent Company’s executives and other employees under the Parent Company’s shareholder-approved long-term incentive plan.

Common Partnership Units and Preferred Mirror Units

The Operating Partnership issues partnership units to the Parent Company in exchange for the contribution of the net proceeds of any equity security issuance by the Parent Company. The number and terms of such partnership units correspond to the number and terms of the related equity securities issued by the Parent Company. In addition, the Operating Partnership may also issue separate classes of partnership units. Historically, the Operating Partnership has had the following types of partnership units outstanding: (i) Preferred Partnership Units which have been issued to parties other than the Parent Company; (ii) Preferred Mirror Partnership Units which have been issued to the Parent Company; and (iii) Common Partnership Units which include both interests held by the Parent Company and those held by other limited partners.

Preferred Mirror Partnership Units

In exchange for the proceeds received in corresponding offerings by the Parent Company of preferred units of beneficial interest, the Operating Partnership has issued to the Parent Company a corresponding amount of Preferred Mirror Partnership Units with terms consistent with that of the preferred securities issued by the Parent Company.

Common Partnership Units (Redeemable and General)

The Operating Partnership has two classes of Common Partnership Units: (i) Class A Limited Partnership Interest which are held by both the Parent Company and outside third parties and (ii) General Partnership Interests which are held by the Parent Company (collectively, the Class A Limited Partnership Interest, and General Partnership Interests are referred to as “Common Partnership Units”). The holders of the Common Partnership Units are entitled to share in cash distributions from, and in profits and losses of, the Operating Partnership, in proportion to their respective percentage interests, subject to preferential distributions on the preferred mirror units and the preferred units.

The Common Partnership Units held by the Parent Company (comprised of both General Partnership Units and Class A Limited Partnership Units) are presented as partner’s equity in the consolidated financial statements. Class A Limited Partnership Interest held by parties other than the Parent Company are redeemable at the option of the holder for a like number of common shares of the Parent Company, or cash, or a combination thereof, at the election of the Parent Company. Because the form of settlement of these redemption rights are not within the control of the Operating Partnership, these Common Partnership Units have been excluded from partner’s equity and are presented as redeemable limited partnership units measured at the potential cash redemption value as of the end of the periods presented based on the closing market price of the Parent Company’s common shares at December 31, 2015, 2014 and 2013, which was $13.66, $15.98, $14.09, respectively. As of December 31, 2015 and 2014, 1,535,102 of Class A Units were outstanding and owned by outside limited partners of the Operating Partnership. As of December 31, 2013, 1,763,739 of Class A Units were outstanding and owned by outside limited partners of the Operating Partnership.

On December 8, 2015, the Operating Partnership declared a distribution of $0.15 per common unit, totaling $26.5 million, which was paid on January 20, 2016 to unitholders of record as of January 6, 2016. On December 8, 2015, the Operating Partnership declared distributions on its Series E Preferred Units to holders of record as of December 30, 2015. These units are entitled to a preferential return of 6.90% per annum on the $25.00 per share liquidation preference. Distributions paid on January 15, 2016 to holders of Series E Preferred Shares totaled $1.7 million.

On November 5, 2013, the Parent Company commenced a continuous equity offering program (the “Offering Program”), under which it may sell, in at-the-market offerings, up to an aggregate amount of 16,000,000 common shares until November 5, 2016. This Offering Program replaced a prior continuous equity offering program which expired on March 10, 2013. The Parent Company may sell common shares in amounts and at times to be determined by the Parent Company. Actual sales will depend on a variety of factors to be determined by the Parent Company, including, among others, market conditions, the trading price of the Company’s common shares of beneficial interest and determinations by the Parent Company of the appropriate sources of funding. In conjunction with the Offering Program, the Parent Company engages sales agents who receive compensation, in aggregate, of up to 2% of the gross sales price per share sold. From inception of the Offering Program through December 31, 2015 the Parent Company has not sold any shares under the program, resulting in 16,000,000 remaining shares available for sale. Generally, the Parent Company contributes the net proceeds from the sales to the Operating Partnership, which the Operating Partnership in turn uses for general corporate purposes.

Common Unit Repurchases

The Parent Company maintains a share repurchase program under which the Board of Trustees has authorized the Parent Company to repurchase shares of its preferred and common stock with no expiration date. On July 22, 2015, the Parent Company's Board of Trustees authorized additional share repurchases of up to $100.0 million. Prior to the authorization 539,200 common shares were available for repurchase under the preexisting share repurchase program. The Company expects to fund the share repurchases with a combination of available cash balances and availability under our line of credit. As of December 31, 2015, 5,209,437 common shares have been repurchased and retired at an average purchase price of $12.90 per share and totaling $67.3 million. The timing and amounts of any purchases will depend on a variety of factors, including market conditions, regulatory requirements, share prices, capital availability and other factors as determined by our management team. The repurchase program does not require the purchase of any minimum number of shares and may be suspended or discontinued at any time without notice.

The common stock repurchases were retired and, as a result, were accounted for in accordance with Maryland law, which does not contemplate treasury stock. The repurchases were recorded as a reduction of common stock (at $0.01 par value per share) and a decrease to additional paid-in-capital.