Accounting for the Impairment or Disposal of Long-Lived Assets

3 Months Ended

Mar. 31, 2012

Accounting for the Impairment or Disposal of Long-Lived Assets [Abstract]

Accounting for the Impairment or Disposal of Long-Lived Assets

Accounting for the Impairment or Disposal of Long-Lived Assets

The operating results and gain/(loss) on disposition of real estate for properties sold and held for sale are reflected in the consolidated statements of income as discontinued operations. Prior period financial statements have been adjusted for discontinued operations. The proceeds from dispositions of operating properties for the three months ended March 31, 2012 were $6.5 million as compared to $3.6 million for the same period in 2011.

Below is a summary of the results of operations for the properties held for sale and disposed of through the respective disposition dates (in thousands):

	For the Three Months Ended
	March 31, 2012			March 31, 2011
Revenues	$	9,409		$	21,961
Operating expenses	(4,090		)	(9,555		)
Interest and other income	27			95
Interest expense	(2,428		)	(3,280		)
Depreciation and amortization	(71		)	(5,462		)
Income before gain on property dispositions	2,847			3,759
Gain on property dispositions	1,064			470
Income from discontinued operations	$	3,911		$	4,229

Eighteen properties totaling 957,000 square feet in the Company’s Central reportable segment, 16 properties totaling 980,000 square feet in the Company's South reportable segment and 16 properties totaling 633,000 square feet in the Company's Northeast - Other reportable segment were considered to be held for sale as of March 31, 2012. These properties had an aggregate cost basis of $200.8 million as of March 31, 2012 and were subject to contracts for sale for an aggregate of $199.1 million. Forty-nine of these properties were sold subsequent to March 31, 2012 for proceeds of $195.0 million.

Interest expense is allocated to discontinued operations. The allocation of interest expense to discontinued operations was based on the ratio of net assets sold and held for sale (without continuing involvement) to the sum of total net assets plus consolidated debt.

Asset Impairment

During the three months ended March 31, 2012, the Company recognized $57,000 in impairment in the Company's South reportable segment. This impairment is included in discontinued operations in the Company’s consolidated statements of income. The Company determined this impairment through a comparison of the aggregate future cash flows (including quoted offer prices, a Level I input according to the fair value hierarchy established by the FASB in Topic 820, “Fair Value Measurements and Disclosures”) to be generated by the property to the carrying value of the properties. The Company has evaluated each of the properties and land held for development and has determined that there are no additional valuation adjustments necessary at March 31, 2012. During the three months ended March 31, 2011, the Company recognized an impairment charge of $550,000 related a property in the Central reportable segment. This impairment is included in discontinued operations in the Company's consolidated statements of income.