Business Combination

12 Months Ended

Dec. 31, 2015

Business Acquisition [Line Items]

Business Combination

BUSINESS COMBINATION

On October 8, 2013, the Company acquired all of the outstanding general and limited partnership interests of Cabot Industrial Fund III Operating Partnership, L.P., a Delaware limited partnership (the "Cabot Acquisition"). The acquisition resulted in the purchase of a 100% ownership interest in 177 industrial assets totaling approximately 23.0 million square feet. The purchase price for the Cabot Acquisition was $1.469 billion, which was paid through the assumption of approximately $229.8 million of mortgage debt and the remainder in cash. The Company funded the cash portion of the acquisition consideration through a combination of proceeds from an August 2013 equity offering, proceeds from a September 2013 offering of senior notes and draws under its Credit Facility.

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date.

Assets
Real estate:
Land and land improvements	$	247,393
Building and improvements	1,152,717
Operating real estate	1,400,110
Intangible - in-place leases/market rent	97,396
Other assets	4,953
Total assets	1,502,459
Liabilities
Mortgage loans	243,230
Other liabilities	32,958
Intangible - market rent	5,737
Total liabilities	281,925
Net assets acquired	$	1,220,534

The weighted average amortization period of the in-place lease intangibles is 4.4 years.

Costs incurred in conjunction with the Cabot Acquisition and related funding include the following:

• $7.6 million of acquisition costs in the year ended December 31, 2013 (included in general and administrative expenses on the Company’s consolidated statements of comprehensive income) and $4.2 million in financing fees in the year ended December 31, 2013 (included in interest expense in the Company’s consolidated statements of comprehensive income).

• Deferred financing costs of approximately $2.0 million associated with the assumption of $229.8 million in mortgage debt ($243.2 million fair value) assumed at closing.

• Deferred financing costs of $3.9 million incurred in conjunction with the financing of the September 27, 2013 $450.0 million senior unsecured notes offering (included in unsecured notes in the Company’s consolidated balance sheets with amortization reflected in interest expense over the life of the related notes in the Company’s consolidated statements of comprehensive income).

• Costs of $35.3 million incurred in conjunction with the August 7, 2013 issuance of 24.2 million of the Company’s common shares (included as a reduction to equity in the Company’s consolidated balance sheets).

The Company recognized $31.4 million of operating revenue and $22.0 million of net operating income (see description of net operating income in Footnote 18 - Segment Information) related to the properties acquired in the Cabot Acquisition during 2013.

The following unaudited pro forma condensed income statement information has been prepared as if the Cabot Acquisition, the Trust’s August 2013 common share offering and the Operating Partnership’s September 2013 senior note offering had been completed on January 1, 2013. The pro forma condensed consolidated financial information does not purport to represent what the Company’s results of operations would have been assuming the completion of the Cabot Acquisition and the related financing activities had occurred on January 1, 2013 nor do they purport to project the results of operations of the Company for any future period (in thousands):

	For the Year Ended
	December 31, 2013
Total operating revenue	$	750,896
Net income available to common shareholders	$	211,601

These amounts have been calculated after applying the Company's accounting policies and adjusting the results of the Cabot Acquisition to reflect the additional depreciation and amortization that would have been charged assuming the fair value adjustments to building and improvements and in-place lease intangibles had been applied on January 1, 2013.