ACQUISITION OF REAL ESTATE AND DISCONTINUED OPERATIONS

Acquisitions

2013 Core Portfolio Acquisitions

During March 2013, the Company acquired 664 North Michigan Avenue, an 18,141 square foot retail condominium in Chicago, Illinois for $86.6 million.

During June 2013, the Company acquired 8-12 East Walton Street, an 8,244 square foot retail property in Chicago, Illinois for $22.5 million.

The Company expensed $1.0 million of acquisition costs for the six months ended June 30, 2013 related to the Core Portfolio.

2013 Fund III Acquisitions

Fund III had previously acquired a $23.0 million note receivable at a discounted price of $18.5 million during April 2012. The note receivable, which was scheduled to mature in May 2012, was collateralized by a 79,526 square foot shopping center located in Brooklyn, New York ("Nostrand Place"). The Company commenced foreclosure proceedings, but ultimately agreed to a settlement with the unaffiliated borrower. Pursuant to the settlement, in February 2013, Fund III and the borrower formed a joint venture whereby Fund III contributed its interest in the note for a 99% controlling interest in the joint venture, and the borrower contributed the deed to Nostrand Place in exchange for a 1% interest in the joint venture. As a result, Fund III consolidates its investment in Nostrand Place.

2013 Fund IV Acquisitions

During June 2013, Fund IV, in a joint venture with an unaffiliated partner, acquired a 98% initial interest in 2819 Kennedy Boulevard, a 53,680 square foot retail property in North Bergen, New Jersey for $9.0 million.

During June 2013, Fund IV, in a joint venture with an unaffiliated partner, acquired a 99% initial interest in Promenade at Manassas, a 265,442 square foot shopping center in Manassas, Virginia for $38.0 million.

The Company expensed $1.4 million of acquisition costs for the six months ended June 30, 2013 related to Fund IV.

4. ACQUISITION OF REAL ESTATE AND DISCONTINUED OPERATIONS (continued)

Purchase Price Allocations

The above acquisitions have been accounted for as business combinations. The purchase prices were allocated to the acquired assets and liabilities based on the estimated fair value of the acquired assets at the dates of acquisition. The preliminary measurements at fair value reflected below are subject to change. The Company expects to finalize the valuations and complete the purchase price allocations within one year from the dates of acquisition.

The following table summarizes the Company's preliminary allocations of the purchase prices of assets acquired and liabilities assumed during 2013 which have yet to be finalized:



(dollars in thousands)	Preliminary Purchase Price Allocations
Land	$	39,563
Buildings and improvements	136,009
Total consideration	$	175,572

During 2012, the Company acquired properties and recorded the preliminary allocations of the purchase prices to the assets acquired based on provisional measurements of fair value. During 2013, the Company finalized the allocations of the purchase prices and made certain measurement period adjustments. The following table summarizes the preliminary allocations of the purchase prices of these properties as recorded as of December 31, 2012, and the finalized allocations as adjusted as of June 30, 2013:



(dollars in thousands)	Purchase Price Allocations as Originally Reported		Adjustments			Finalized Purchase Price Allocations
Land	$	11,390	$	2,876		$	14,266
Buildings and improvements	38,510		(2,330		)	36,180
Acquisition-related intangible assets (in Acquired lease intangibles, net)	—		2,623			2,623
Acquisition-related intangible liabilities (in Acquired lease and other intangibles, net)	—		(1,852		)	(1,852		)
Below market debt assumed (in Mortgage notes payable)	—		(1,317		)	(1,317		)
Total consideration	$	49,900	$	—		$	49,900

Dispositions

During May 2013, Fund II sold the storage facility located at its Pelham Manor property for $11.9 million. This sale resulted in a $4.2 million gain.

4. ACQUISITION OF REAL ESTATE AND DISCONTINUED OPERATIONS (continued)

Discontinued Operations

The Company reports properties held-for-sale and properties sold during the periods as discontinued operations. The results of operations of discontinued operations are reflected as a separate component within the accompanying Consolidated Statements of Income for all periods presented. As of June 30, 2013, one of the properties within the Opportunity Funds was under contract for sale.

The combined assets and liabilities and the results of operations of the properties classified as discontinued operations, in each period presented, are summarized as follows:



(dollars in thousands)
BALANCE SHEET	June 30, 2013		December 31, 2012
ASSETS
Net real estate	$	11,850	$	19,400
Rents receivable, net	876		917
Deferred charges, net	390		612
Prepaid expenses and other assets	190		1,132
Total assets of discontinued operations	$	13,306	$	22,061
LIABILITIES
Mortgage notes payable	$	9,149	$	9,208
Accounts payable and accrued expenses	1,794		3,125
Other liabilities	597		765
Total liabilities of discontinued operations	$	11,540	$	13,098



	Three Months Ended						Six Months Ended
(dollars in thousands)	June 30,						June 30,
STATEMENTS OF INCOME	2013			2012			2013			2012
Total revenues	$	906		$	9,943		$	2,075		$	19,656
Total expenses	640			6,611			1,412			13,997
Operating income	266			3,332			663			5,659
Gain on sale of property	4,191			2,668			4,191			2,668
Income from discontinued operations	4,457			6,000			4,854			8,327
Income from discontinued operations attributable to noncontrolling interests	(3,911		)	(5,006		)	(4,259		)	(6,811		)
Income from discontinued operations attributable to Common Shareholders	$	546		$	994		$	595		$	1,516