Real Estate

12 Months Ended

Dec. 31, 2018

Acquisition And Disposition Of Properties And Discontinued Operations [Abstract]

2. Real Estate

The Company’s consolidated real estate is comprised of the following (in thousands):

	December 31,
	2018			2017
Land	$	710,469		$	658,835
Buildings and improvements		2,594,828			2,406,488
Tenant improvements		151,154			131,850
Construction in progress		44,092			18,642
Properties under capital lease		76,965			76,965
Total		3,577,508			3,292,780
Less: Accumulated depreciation		(416,657	)		(339,862	)
Operating real estate, net		3,160,851			2,952,918
Real estate under development, at cost		120,297			173,702
Net investments in real estate	$	3,281,148		$	3,126,620

Acquisitions and Conversions

During the years ended December 31, 2018 and December 31, 2017, the Company acquired the following consolidated retail properties (dollars in thousands):

Property and Location	Percent Acquired	Date of Acquisition	Purchase Price
2018 Acquisitions and Conversions
Core
Bedford Green Land Parcel - Bedford Hills, NY	100%	Mar 23, 2018	$	1,337
Subtotal Core				1,337

Fund IV
Broughton Street Partners I - Savannah, GA (Conversion) (Note 4)	100%	Oct 11, 2018		36,104
Subtotal Fund IV				36,104

Fund V
Trussville Promenade - Trussville, AL	100%	Feb 21, 2018		45,259
Elk Grove Commons - Elk Grove, CA	100%	Jul 18, 2018		59,320
Hiram Pavilion - Hiram, GA	100%	Oct 23, 2018		44,443
Subtotal Fund V				149,022
Total 2018 Acquisitions and Conversions			$	186,463

2017 Acquisitions and Conversions
Core
Market Square Shopping Center - Wilmington, DE (Conversion) (Note 4)	100%	Nov 16, 2017	$	42,800
Subtotal Core				42,800

Fund IV
Lincoln Place - Fairview Heights, IL	100%	Mar 13, 2017		35,350
Shaw's Plaza - Windham, ME (Conversion) (Note 3)	100%	Jun 30, 2017		9,142
Subtotal Fund IV				44,492

Fund V
Plaza Santa Fe - Santa Fe, NM	100%	Jun 5, 2017		35,220
Hickory Ridge - Hickory, NC	100%	Jul 27, 2017		44,020
New Towne Plaza - Canton, MI	100%	Aug 4, 2017		26,000
Fairlane Green - Allen Park, MI	100%	Dec 20, 2017		62,000
Subtotal Fund V				167,240
Total 2017 Acquisitions and Conversions			$	254,532

The 2018 acquisitions were considered asset acquisitions based on accounting guidance effective as of January 1, 2018 (). The 2017 acquisitions and conversions were deemed to be business combinations. For the year ended December 31, 2018, the Company capitalized $0.3 million of acquisition costs related to the Funds. The Company expensed $2.1 million of acquisition costs for the year ended December 31, 2017, of which $1.2 million related to the Core Portfolio and $0.9 million related to the Funds. No debt was assumed in any of the 2018 Acquisitions or 2017 Acquisitions or Conversions.

Revenues and net income from the Company’s consolidated 2018 acquisitions and conversions totaled $9.0 million and $0.5 million, respectively for the year ended December 31, 2018. Revenues and net loss from the Company’s consolidated 2017 acquisitions and conversions totaled $10.2 million and $3.5 million, respectively for the year ended December 31, 2017.

Purchase Price Allocations

The purchase prices for the 2018 acquisitions and the 2017 acquisitions and conversions were allocated to the acquired assets and assumed liabilities based on their estimated fair values at the dates of acquisition. The following table summarizes the allocation of the purchase price of properties acquired during the years ended December 31, 2018 and December 31, 2017 (in thousands):

	Year Ended December 31,
	2018			2017
Net Assets Acquired
Land	$	38,086		$	48,138
Buildings and improvements		129,586			173,576
Other assets		—			84
Acquisition-related intangible assets (Note 6)		26,693			44,269
Acquisition-related intangible liabilities (Note 6)		(7,902	)		(11,535	)
Net assets acquired	$	186,463		$	254,532

Consideration
Cash	$	147,985		$	200,429
Conversion of note receivable	—				41,010
Liabilities assumed		2,597			3,363
Existing interest in previously unconsolidated investment		35,881			4,159
Change in control of previously unconsolidated investment	—				5,571
Total Consideration	$	186,463		$	254,532

Dispositions

During the years ended December 31, 2018 and December 31, 2017, the Company disposed of the following consolidated properties (in thousands):

Property and Location	Owner	Date Sold	Sale Price		Gain (Loss) on Sale
2018 Disposition
Sherman Avenue - New York, NY	Fund II	Apr 17, 2018	$	26,000	$	33
Lake Montclair - Dumfries, VA	Fund IV	Aug 27, 2018		22,450		2,923
1861 Union Street - San Francisco, CA	Fund IV	Aug 29, 2018		6,000		2,184
210 Bowery - 4 Residential Condos - New York, NY	Fund IV	Nov 30, 2018, Dec 10, 2018, Dec 17, 2018, Dec 21, 2018		12,050		—
Total 2018 Dispositions			$	66,500	$	5,140

2017 Dispositions
New Hyde Park Shopping Center - New Hyde Park, NY	Fund III	Jul 6, 2017	$	22,075	$	6,433
216th Street - New York, NY	Fund II	Sep 11, 2017		30,579		6,543
City Point Condominium Tower I - Brooklyn, NY	Fund II	Oct 13, 2017		96,000		(810	)
1151 Third Avenue - New York, NY	Fund IV	Nov 16, 2017		27,000		5,183
260 E 161st Street - Bronx, NY	Fund II	Dec 13, 2017		105,684		31,537
Total 2017 Dispositions			$	281,338	$	48,886

The aggregate revenue, expenses and pre-tax income reported within continuing operations for the aforementioned consolidated properties that were sold during the years ended December 31, 2018, December 31, 2017 and December 31, 2016 were as follows (in thousands):

	Year Ended December 31,
	2018			2017			2016
Revenues	$	1,968		$	16,249		$	20,097
Expenses		(1,874	)		(20,529	)		(17,079	)
Loss (income) from continuing operations of disposed properties before gain on disposition of properties		94			(4,280	)		3,018
Gain on disposition of properties		5,140			48,886			81,965
Net income attributable to noncontrolling interests		(3,368	)		(32,254	)		(70,714	)
Net income attributable to Acadia	$	1,866		$	12,352		$	14,269

Properties Held for Sale

At December 31, 2018, the Company had no properties classified as held-for-sale. At December 31, 2017, the Company had one property in Fund II classified as held-for-sale, Sherman Avenue, with total assets of $25.4 million, which was sold on April 17, 2018 as noted in the disposition table above. This property’s net operating loss of $0.5 million and $0.6 million for the year ended December 31, 2018 and 2017, respectively, is included in the table above. At December 31, 2017, the Company recognized an impairment charge of approximately $10.6 million inclusive of an amount attributable to a noncontrolling interest of $7.6 million ().

Real Estate Under Development and Construction in Progress

Real estate under development represents the Company’s consolidated properties that have not yet been placed into service while undergoing substantial development or construction.

Development activity for the Company’s consolidated properties comprised the following during the periods presented (dollars in thousands):

	December 31, 2017				Year Ended 2018						December 31, 2018
	Number of Properties		Carrying Value		Transfers In		Capitalized Costs		Transfers Out		Number of Properties		Carrying Value
Core		2	$	21,897	$	—	$	6,320	$	20,458		1	$	7,759
Fund II		—		4,908		—		2,554		—		—		7,462
Fund III		2		63,939		—		36,117		78,814		1		21,242
Fund IV		1		82,958		—		876		—		1		83,834
Total		5	$	173,702	$	—	$	45,867	$	99,272		3	$	120,297

During the year ended December 31, 2018, the Company placed one Core development project into service and one Fund III development project into service. In addition to the consolidated projects noted above, the Company had one unconsolidated project in development at December 31, 2017, which it placed into service during the year ended December 31, 2018.

During the year ended December 31, 2017, the Company placed substantially all of Fund II’s City Point project into service as well as three Fund IV properties, reclassified Fund II’s Sherman Avenue property as held for sale and placed one Core property into development. In addition to the consolidated projects noted above, the Company had one unconsolidated project remaining in development after placing three of its four unconsolidated Fund IV development properties into service during the year ended December 31, 2017.

Construction in progress pertains to construction activity at the Company’s operating properties which are in service and continue to operate during the construction period.