EARNINGS PER SHARE

9 Months Ended

Sep. 30, 2019

Basic earnings per share is computed by dividing net income available to common shareholders by the weighted average number of our common shares of beneficial interest (“common shares”) outstanding during the period. We have issued restricted stock units (“RSUs”) under our 2015 Incentive Plan and Series D Convertible Preferred Units ("Series D preferred units"), which could have a dilutive effect on our earnings per share upon exercise of the RSUs or upon conversion of the Series D preferred units (refer to Note 4 for further discussion of the Series D preferred units). Other than the issuance of RSUs and Series D preferred units, we have no outstanding options, warrants, convertible stock or other contractual obligations requiring issuance of additional shares that would result in dilution of earnings. Under the terms of the Operating Partnership’s Agreement of Limited Partnership, limited partners have the right to require the Operating Partnership to redeem their limited partnership units (“Units”) any time following the first anniversary of the date they acquired such Units (“Exchange Right”). Upon the exercise of Exchange Rights, and in our sole discretion, we may issue common shares in exchange for Units on a one-for-one basis.

Performance-based restricted stock awards and RSUs of 37,822 and 24,844 for the three months ended September 30, 2019 and 2018, respectively, and 37,822 and 24,844, respectively, for the nine months ended September 30, 2019 and 2018 were excluded from the calculation of diluted earnings per share because the assumed proceeds per share plus the average unearned compensation were greater than the average market price of the common stock for the periods presented and, therefore, were anti-dilutive.

The following table presents a reconciliation of the numerator and denominator used to calculate basic and diluted earnings per share reported in the condensed consolidated financial statements for the three and nine months ended September 30, 2019 and 2018:



	(in thousands, except per share data)
	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
NUMERATOR
Income (loss) from continuing operations – controlling interests	$	31,596		$	2,142		$	30,011		$	(24,058	)
Income (loss) from discontinued operations – controlling interests	—			511			—			13,141
Net income (loss) attributable to controlling interests	31,596			2,653			30,011			(10,917		)
Dividends to preferred shareholders	(1,705		)	(1,705		)	(5,116		)	(5,116		)
Numerator for basic earnings (loss) per share – net income available to common shareholders	29,891			948			24,895			(16,033		)
Noncontrolling interests – Operating Partnership	3,145			112			2,550			(1,888		)
Dividends to preferred unitholders	160			—			377			—
Numerator for diluted earnings (loss) per share	$	33,196		$	1,060		$	27,822		$	(17,921	)
DENOMINATOR
Denominator for basic earnings per share weighted average shares	11,625			11,932			11,705			11,944
Effect of redeemable operating partnership units	1,223			1,386			1,282			1,407
Effect of Series D preferred units	228			—			181			—
Effect of dilutive restricted stock awards and restricted stock units	11			—			6			—
Denominator for diluted earnings per share	13,087			13,318			13,174			13,351

Earnings (loss) per common share from continuing operations – basic	$	2.57		$	0.04		$	2.11		$	(2.44	)
Earnings (loss) per common share from discontinued operations – basic	—			0.04			—			1.10
NET EARNINGS (LOSS) PER COMMON SHARE – BASIC	$	2.57		$	0.08		$	2.11		$	(1.34	)

Earnings (loss) per common share from continuing operations – diluted	$	2.54		$	0.04		$	2.11		$	(2.44	)
Earnings (loss) per common share from discontinued operations – diluted	—			0.04			—			1.10
NET EARNINGS (LOSS) PER COMMON SHARE – DILUTED	$	2.54		$	0.08		$	2.11		$	(1.34	)