9.	Commitments and Contingencies

Hurricane Loss

In 2017, Hurricane Maria made landfall in Puerto Rico. At June 30, 2018, RVI owned 12 assets in Puerto Rico, aggregating 4.4 million square feet of Company-owned gross leasable area (“GLA”). These assets are included in the spin-off of RVI (Note 1). One of the 12 assets (Plaza Palma Real, consisting of approximately 0.4 million of Company-owned GLA) was severely damaged and was not operational following the storm, except for two anchor tenants and a few other tenants representing a minimal amount of Company-owned GLA. The other 11 assets sustained varying degrees of damage, consisting primarily of roof and HVAC system damage and water intrusion.

As of June 30, 2018, the estimated net book value of the property damage written-off for damage to the Company’s Puerto Rico assets owned as of that date was $78.8 million. In addition, at June 30, 2018, the property insurance receivable was $49.2 million related to the net book value of the property damage write-off as well as other expenses net of property damage insurance payments received. The carrying value of the Puerto Rico real estate assets and a majority of the property insurance receivable was transferred to RVI in connection with the consummation of the spin-off on July 1, 2018. The remaining insurance receivable of $1.2 million related to expenses incurred that were subsequently paid by the insurance company.

The Company’s business interruption insurance covers lost revenue through the period of property restoration and for up to 365 days following completion of restoration. For the six months ended June 30, 2018, rental revenues of $6.6 million were not recorded because of lost tenant revenue attributable to Hurricane Maria that has been partially defrayed by insurance proceeds. The Company will record revenue for covered business interruption in the period it determines that it is probable it will be compensated and the applicable contingencies with the insurance company are resolved. This income recognition criteria will likely result in business interruption insurance proceeds being recorded in periods subsequent to the period that the Company experienced lost revenue from the damaged properties. For the three and nine months ended September 30, 2018, the Company received insurance proceeds of approximately $1.8 million and $6.9 million, respectively, related to business interruption claims, which is recorded on the Company’s consolidated statements of operations as Business Interruption Income.

Following the completion of the spin-off of RVI, other than with respect to revenue losses and repair costs previously incurred by the Company, it is expected that insurance proceeds from Hurricane Maria will largely be allocated to RVI pursuant to the terms of the agreement governing the separation of the Company and RVI.