Real Estate Assets

12 Months Ended

Dec. 31, 2021

Real Estate Assets

Acquisitions

During 2021, we acquired a portfolio of real estate assets from PAC. The portfolio consists of the following assets:

Asset

Market

Submarket/BBD

Square Footage

150 Fayetteville

Raleigh

CBD

560,000

CAPTRUST Towers

Raleigh

North Hills

300,000

Capitol Towers

Charlotte

SouthPark

479,000

Morrocroft Centre

Charlotte

SouthPark

291,000

Galleria 75 Redevelopment Site

Atlanta

Cumberland/Galleria

Our total purchase price, net of closing credits and cash acquired, was $653.6 million, including $4.5 million of capitalized acquisition costs. The acquisition included the assumption of four secured loans (see Note 6). The assets acquired and liabilities assumed were recorded at relative fair value as determined by management, with the assistance of third party specialists, based on information available at the acquisition date and on current assumptions as to future operations.

The following table sets forth a summary of the relative fair value of the material assets acquired and liabilities assumed relating to this acquisition:


	Amount Recorded at Acquisition
Real estate assets (1)	$	593,039
Acquisition-related intangible assets (in deferred financing and leasing costs) (1)	$	61,126
Right of use asset (in prepaid expenses and other assets) (1)	$	8,440
Mortgages and notes payable	$	(403,000)
Debt issuance costs (in mortgages and notes payable) (1)	$	3,473
Acquisition-related intangible liabilities (in accounts payable, accrued expenses and other liabilities) (1)	$	(7,174)
Lease liability (in accounts payable, accrued expenses and other liabilities) (1)	$	(5,310)

__________

(1)Included in purchase price.

During 2021, we also acquired various development land parcels in Nashville for an aggregate purchase price, including capitalized acquisition costs, of $74.1 million. The $16.0 million purchase price for one of the acquired parcels is expected to be paid in or prior to second quarter 2023.

During 2021, we also acquired our joint venture partner’s 75.0% interest in our Highwoods DLF Forum, LLC joint venture (the “Forum”), which owned five buildings in Raleigh encompassing 636,000 rentable square feet, for a purchase price of $131.3 million. We previously accounted for our 25.0% interest in this joint venture using the equity method of accounting. The assets and liabilities of the joint venture are now wholly owned and we have determined the acquisition constitutes an asset purchase. As such, because the Forum is not a variable interest entity, we allocated our previously held equity interest at historical cost along with the consideration paid and acquisition costs to the assets acquired and liabilities assumed. The assets acquired and liabilities assumed were recorded at relative fair value as determined by management, with the assistance of third party specialists, based on information available at the acquisition date and on current assumptions as to future operations.

During 2020, we acquired two development land parcels totaling less than one acre in Raleigh and Nashville for an aggregate purchase price of $8.5 million, including the issuance of 118,592 Common Units and capitalized acquisition costs.

During 2019, we acquired a building in the central business district of Charlotte, which delivered in 2019 and encompasses 841,000 rentable square feet, for a net purchase price of $399.1 million. The assets acquired and liabilities assumed were recorded at relative fair value as determined by management, with the assistance of third party specialists, based on information available at the acquisition date and on current assumptions as to future operations.

During 2019, we also acquired four development land parcels totaling approximately 10 acres in Raleigh, Richmond and Pittsburgh for an aggregate purchase price, including capitalized acquisition costs, of $12.4 million.

Dispositions

During 2021, we sold a total of 13 office buildings and various land parcels in Atlanta, Memphis, Raleigh, Richmond and Tampa for an aggregate sale price of $384.6 million (before closing credits to buyer of $6.9 million) and recorded aggregate gains on disposition of property of $172.8 million.

During 2020, we sold a total of 52 buildings in Greensboro and Memphis and various land parcels for an aggregate sale price of $494.2 million (before closing credits to buyer of $5.7 million) and recorded aggregate gains on disposition of property of $215.5 million. During 2020, we also recognized $0.4 million of gain related to the satisfaction of a performance obligation as part of a 2016 land sale.

During 2019, we sold a total of six buildings and various land parcels for an aggregate sale price of $136.4 million and recorded aggregate gains on disposition of property of $39.5 million.

Impairments

During 2020, we recorded an impairment of real estate assets of $1.8 million, which resulted from a change in market-based inputs and our assumptions about the use of the assets.

During 2019, we recorded aggregate impairments of real estate assets of $5.8 million as a result of shortened hold periods from classifying all of our assets in Greensboro and Memphis as non-core and changes in market-based inputs and our assumptions about the use of the assets.