Commitments and Contingencies

6 Months Ended

Jun. 30, 2016

Commitments and Contingencies Disclosure [Abstract]

Legal Proceedings

The Company is, from time to time, involved in litigation arising in the ordinary course of business. The Company is not aware of any pending or threatened litigation that, if resolved against the Company, would have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows.

Redevelopment Activity

The Company is in the process of redeveloping two medical office buildings in Tennessee, including a 70,000 square foot expansion. The Company spent approximately $39.2 million on the redevelopment of these properties through June 30, 2016, including the acquisition of a land parcel for $4.3 million on which the Company is building a parking garage. The total redevelopment budget for these properties is $51.8 million. It is anticipated that the garage will be completed in the third quarter of 2016 and tenants will begin to take occupancy of the expansion in the first quarter of 2017.

Development Activity

In 2015, the Company began development of a 98,000 square foot medical office building in Colorado. The total development budget is $26.5 million, of which $3.0 million has been spent as of June 30, 2016. Construction is expected to be completed in the second quarter of 2017.

Completed Developments

The Company completed the redevelopment of a medical office building in Alabama, which included the construction of a parking garage. Construction of the garage was completed in the fourth quarter of 2015. The total redevelopment budget is $15.4 million, of which $11.5 million has been spent as of June 30, 2016. The remaining $3.9 million budgeted for the project is primarily related to a tenant improvement allowance that is expected to be funded in 2016.

In December 2015, the Company began development of a 12,900 square foot retail center in Texas, which is adjacent to two of the Company's existing medical office buildings associated with Baylor Scott & White Health. Construction was completed on April 15, 2016. The total development budget is $5.6 million, of which $4.8 million has been spent as of June 30, 2016. These amounts include $1.5 million used by the Company to purchase land in 2006 and previously recorded as land held for development. The project is 100% leased and the remaining $0.8 million budgeted for the project is related to tenant build-out that is expected to be completed by the end of 2016.

The table below details the Company’s construction activity as of June 30, 2016. The information included in the table below represents management’s estimates and expectations at June 30, 2016, which are subject to change. The Company’s disclosures regarding certain projections or estimates of completion dates may not reflect actual results.



			Balance at June 30, 2016
(Dollars in thousands)	Number of Properties	Estimated Completion Date	Construction in Progress Balance		Other Amounts Funded		Total Amount Funded		Estimated Remaining Fundings		Estimated Total Investment		Approximate Square Feet
Construction Activity
Nashville, TN	2	Q1 2017	$	32,180	$	7,050	$	39,230	$	12,570	$	51,800	294,000
Denver, CO	1	Q2 2017	2,994		—		2,994		23,506		26,500		98,000
Total			$	35,174	$	7,050	$	42,224	$	36,076	$	78,300	392,000