Unconsolidated Affiliates, Redeemable Interests, Noncontrolling Interests and Cost Method Investments

Unconsolidated Affiliates

At June 30, 2015, the Company had investments in the following 19 entities, which are accounted for using the equity method of accounting:



Joint Venture	Property Name	Company's Interest
Ambassador Infrastructure, LLC	Ambassador Town Center - Infrastructure Improvements	65.0%
Ambassador Town Center JV, LLC	Ambassador Town Center	65.0%
CBL/T-C, LLC	CoolSprings Galleria, Oak Park Mall and West County Center	50.0%
CBL-TRS Joint Venture, LLC	Friendly Center, The Shops at Friendly Center and a portfolio of four office buildings	50.0%
CBL-TRS Joint Venture II, LLC	Renaissance Center	50.0%
El Paso Outlet Outparcels, LLC	The Outlet Shoppes at El Paso (vacant land)	50.0%
Fremaux Town Center JV, LLC	Fremaux Town Center Phases I and II	65.0%
Governor’s Square IB	Governor’s Plaza	50.0%
Governor’s Square Company	Governor’s Square	47.5%
High Pointe Commons, LP	High Pointe Commons	50.0%
High Pointe Commons II-HAP, LP	High Pointe Commons - Christmas Tree Shop	50.0%
JG Gulf Coast Town Center LLC	Gulf Coast Town Center	50.0%
Kentucky Oaks Mall Company	Kentucky Oaks Mall	50.0%
Mall of South Carolina L.P.	Coastal Grand	50.0%
Mall of South Carolina Outparcel L.P.	Coastal Grand (Coastal Grand Crossing and vacant land)	50.0%
Port Orange I, LLC	The Pavilion at Port Orange Phase I and one office building	50.0%
Triangle Town Member LLC	Triangle Town Center, Triangle Town Commons and Triangle Town Place	50.0%
West Melbourne I, LLC	Hammock Landing Phases I and II	50.0%
York Town Center, LP	York Town Center	50.0%

Although the Company had majority ownership of certain joint ventures during 2015 and 2014, it evaluated the investments and concluded that the other partners or owners in these joint ventures had substantive participating rights, such as approvals of:


•	the pro forma for the development and construction of the project and any material deviations or modifications thereto;


•	the site plan and any material deviations or modifications thereto;


•	the conceptual design of the project and the initial plans and specifications for the project and any material deviations or modifications thereto;


•	any acquisition/construction loans or any permanent financings/refinancings;


•	the annual operating budgets and any material deviations or modifications thereto;


•	the initial leasing plan and leasing parameters and any material deviations or modifications thereto; and


•	any material acquisitions or dispositions with respect to the project.

As a result of the joint control over these joint ventures, the Company accounts for these investments using the equity method of accounting.

Condensed combined financial statement information of these unconsolidated affiliates is as follows:



	As of
ASSETS	June 30, 2015			December 31, 2014
Investment in real estate assets	$	2,303,724		$	2,266,252
Accumulated depreciation	(648,705		)	(619,558		)
	1,655,019			1,646,694
Developments in progress	68,749			75,877
Net investment in real estate assets	1,723,768			1,722,571
Other assets	169,288			170,554
Total assets	$	1,893,056		$	1,893,125

LIABILITIES
Mortgage and other indebtedness	$	1,517,877		$	1,512,826
Other liabilities	42,211			42,517
Total liabilities	1,560,088			1,555,343

OWNERS' EQUITY
The Company	194,296			198,261
Other investors	138,672			139,521
Total owners' equity	332,968			337,782
Total liabilities and owners' equity	$	1,893,056		$	1,893,125



	Total for the Three Months Ended June 30,						Company's Share for the Three Months Ended June 30,
	2015			2014			2015			2014
Total revenues	$	63,111		$	61,400		$	32,958		$	32,066
Depreciation and amortization	(19,641		)	(19,230		)	(10,303		)	(10,256		)
Interest income	335			339			257			259
Interest expense	(18,589		)	(18,746		)	(9,587		)	(9,662		)
Operating expenses	(17,468		)	(17,488		)	(9,045		)	(8,989		)
Gain on sales of real estate assets	619			—			601			—
Net income	$	8,367		$	6,275		$	4,881		$	3,418

	Total for the Six Months Ended June 30,						Company's Share for the Six Months Ended June 30,
	2015			2014			2015			2014
Total revenues	$	125,583		$	123,221		$	65,793		$	64,018
Depreciation and amortization	(39,122		)	(38,017		)	(20,620		)	(20,117		)
Interest income	667			679			512			518
Interest expense	(37,383		)	(37,304		)	(19,272		)	(19,153		)
Operating expenses	(36,774		)	(35,669		)	(18,873		)	(18,164		)
Gain on sales of real estate assets	1,434			—			1,164			—
Net income	$	14,405		$	12,910		$	8,704		$	7,102

All of the debt on the properties owned by the unconsolidated affiliates is non-recourse, except for Ambassador, Ambassador Infrastructure, Fremaux Phases I and II, West Melbourne, Port Orange, and Gulf Coast Phase III. See Note 12 for a description of guarantees the Company has issued related to certain unconsolidated affiliates.

See Note 16 for information on the extension of a loan, secured by Gulf Coast Town Center Phase III, subsequent to June 30, 2015.

Redeemable Interests

Redeemable common units of $36,740 and $31,104 at June 30, 2015 and December 31, 2014, respectively, include a partnership interest in the Operating Partnership for which the partnership agreement includes redemption provisions that may require the Operating Partnership to redeem the partnership interest for real property.

Redeemable noncontrolling interests of $6,204 and $6,455 at June 30, 2015 and December 31, 2014, respectively, include the aggregate noncontrolling ownership interest in consolidated subsidiaries that is held by third parties and for which the related partnership agreements contain redemption provisions at the holder's election that allow for redemption through cash and/or properties.

Noncontrolling Interests of the Operating Partnership

Noncontrolling interests include the aggregate noncontrolling ownership interest in the Operating Partnership's consolidated subsidiaries that is held by third parties and for which the related partnership agreements either do not include redemption provisions or are subject to redemption provisions that do not require classification outside of permanent equity. Total noncontrolling interest was $7,254 and $8,908, as of June 30, 2015 and December 31, 2014, respectively.

Noncontrolling Interests of the Company

The noncontrolling interests of the Company include the third party interests discussed above as well as the aggregate noncontrolling partnership interest in the Operating Partnership that is not owned by the Company and for which each of the noncontrolling limited partners has the right to exchange all or a portion of its partnership interests for shares of the Company’s common stock or, at the Company’s election, their cash equivalent. As of June 30, 2015, the Company's total noncontrolling interests of $129,281 consisted of noncontrolling interests in the Operating Partnership and in other consolidated subsidiaries of $122,027 and $7,254, respectively. The Company's total noncontrolling interest at December 31, 2014 of $143,376 consisted of noncontrolling interests in the Operating Partnership and in other consolidated subsidiaries of $134,468 and $8,908, respectively.

Cost Method Investment

The Company owns a 6.2% noncontrolling interest in subsidiaries of Jinsheng, an established mall operating and real estate development company located in Nanjing, China. The Company accounts for its noncontrolling interest in Jinsheng using the cost method because the Company does not exercise significant influence over Jinsheng and there is no readily determinable market value of Jinsheng’s shares since they are not publicly traded. The carrying amount of this investment was $5,325 at June 30, 2015 and December 31, 2014. The noncontrolling interest is reflected as investment in unconsolidated affiliates in the accompanying condensed consolidated balance sheets.

Variable Interest Entities

Triangle Town Member LLC

The Company holds a 50% ownership interest in this joint venture. The Company determined that its investment in this joint venture represents an interest in a VIE. The entity is under joint control, and therefore the Company accounts for it as an unconsolidated affiliate using the equity method of accounting as of June 30, 2015 and December 31, 2014, respectively.

JG Gulf Coast Town Center LLC

Gettysburg Outlet Center Holding LLC

The Company holds a 50% ownership interest in this joint venture. The Company determined that its investment in this joint venture represents an interest in a VIE and that the Company is the primary beneficiary since it has the power to direct activities of the joint venture that most significantly impact the joint venture's economic performance as well as the obligation to absorb losses or right to receive benefits from the VIE that could be significant. As a result, the joint venture is presented in the accompanying condensed consolidated financial statements as of June 30, 2015 and December 31, 2014 on a consolidated basis, with the interests of the third party reflected as a noncontrolling interest.

El Paso Outlet Center Holding, LLC

The Company holds a 75% ownership interest in the joint venture. The Company determined that its investment in this joint venture represents an interest in a VIE and that the Company is the primary beneficiary since it has the power to direct the activities of the joint venture that most significantly impact the joint venture's economic performance as well as the obligation to absorb losses or right to receive benefits from the VIE that could be significant. As a result, the joint venture is presented in the accompanying condensed consolidated financial statements as of June 30, 2015 and December 31, 2014 on a consolidated basis, with the interests of the third party reflected as a noncontrolling interest.