XML 37 R21.htm IDEA: XBRL DOCUMENT v3.22.1
Leases
3 Months Ended
Mar. 31, 2022
Leases [Abstract]  
Leases

8.

Leases

Lessor Accounting

The Company is the lessor for its residential and non-residential leases and these leases are accounted for as operating leases under the lease standard.

For the quarter ended March 31, 2022, approximately 97% of the Company’s total lease revenue is generated from residential apartment leases that are generally twelve months or less in length.  The residential apartment leases may include lease income related to such items as utility recoveries, parking rent, storage rent and pet rent that the Company treats as a single lease component because the amenities cannot be leased on their own and the timing and pattern of revenue recognition are the same.  The collection of lease payments at lease commencement is probable and therefore the Company subsequently recognizes lease income over the lease term on a straight-line basis.  Residential leases are renewable upon consent of both parties on an annual or monthly basis.

For the quarter ended March 31, 2022, approximately 3% of the Company’s total lease revenue is generated by non-residential leases that are generally for terms ranging between five to ten years.  The non-residential leases generally consist of ground floor retail spaces and master-leased parking garages that serve as additional amenities for our residents.  The non-residential leases may include lease income related to such items as utility recoveries, parking rent and storage rent that the Company treats as a single lease component because the amenities cannot be leased on their own and the timing and pattern of revenue recognition are the same.  The collection of lease payments at lease commencement is probable and therefore the Company subsequently recognizes lease income over the lease term on a straight-line basis.  Non-residential leases are renewable with market-based renewal options.

The following table presents the lease income types relating to lease payments for residential and non-residential leases along with the total other rental income for the quarters ended March 31, 2022 and 2021 (amounts in thousands):

 

 

 

Quarter Ended March 31, 2022

 

 

Quarter Ended March 31, 2021

 

Income Type

 

Residential

Leases

 

 

Non-Residential

Leases

 

 

Total

 

 

Residential

Leases

 

 

Non-Residential

Leases

 

 

Total

 

Residential and non-residential rent

 

$

586,890

 

 

$

15,874

 

 

$

602,764

 

 

$

539,655

 

 

$

15,839

 

 

$

555,494

 

Utility recoveries (RUBS income) (1)

 

 

19,598

 

 

 

181

 

 

 

19,779

 

 

 

17,954

 

 

 

178

 

 

 

18,132

 

Parking rent

 

 

10,783

 

 

 

98

 

 

 

10,881

 

 

 

9,734

 

 

 

267

 

 

 

10,001

 

Other lease revenue (2)

 

 

(6,301

)

 

 

(43

)

 

 

(6,344

)

 

 

(10,262

)

 

 

609

 

 

 

(9,653

)

Total lease revenue

 

$

610,970

 

 

$

16,110

 

 

 

627,080

 

 

$

557,081

 

 

$

16,893

 

 

 

573,974

 

Parking revenue

 

 

 

 

 

 

 

 

 

 

8,808

 

 

 

 

 

 

 

 

 

 

 

5,433

 

Other revenue

 

 

 

 

 

 

 

 

 

 

17,460

 

 

 

 

 

 

 

 

 

 

 

18,195

 

Total other rental income (3)

 

 

 

 

 

 

 

 

 

 

26,268

 

 

 

 

 

 

 

 

 

 

 

23,628

 

Rental income

 

 

 

 

 

 

 

 

 

$

653,348

 

 

 

 

 

 

 

 

 

 

$

597,602

 

 

(1)

RUBS income primarily consists of variable payments representing the recovery of utility costs from residents.

 

(2)

Other lease revenue consists of the revenue adjustment related to bad debt and other miscellaneous lease revenue.

(3)

Other rental income is accounted for under the revenue recognition standard.

The following table presents residential and non-residential accounts receivable and straight-line receivable balances for the Company’s properties as of March 31, 2022 and December 31, 2021 (amounts in thousands):

 

 

 

Residential

 

 

Non-Residential

 

Balance Sheet (Other assets):

 

March 31, 2022

 

 

December 31, 2021

 

 

March 31, 2022

 

 

December 31, 2021

 

Resident/tenant accounts receivable balances

 

$

43,267

 

 

$

37,959

 

 

$

3,639

 

 

$

3,218

 

Allowance for doubtful accounts

 

 

(38,774

)

 

 

(33,121

)

 

 

(2,379

)

 

 

(2,365

)

Net receivable balances

 

$

4,493

 

(1)

$

4,838

 

 

$

1,260

 

 

$

853

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Straight-line receivable balances

 

$

5,542

 

 

$

7,460

 

 

$

13,301

 

 

$

13,021

 

 

(1)

The Company held residential security deposits approximating 56.5% of the net receivable balance at March 31, 2022.

The following table presents residential bad debt for the Company’s properties for the quarters ended March 31, 2022 and 2021 (amounts in thousands):

 

 

 

Quarter Ended March 31,

 

Income Statement (Rental income):

 

 

2022

 

 

 

2021

 

Bad debt, net (1)

 

$

9,895

 

 

$

13,693

 

% of rental income

 

 

1.6

%

 

 

2.4

%

 

(1)

Bad debt, net benefited from additional resident payments due to governmental rental assistance programs of approximately $9.8 million for the quarter ended March 31, 2022.