Segment Information

3 Months Ended

Mar. 31, 2016

Segment Reporting, Measurement Disclosures [Abstract]

Segment Information

Segment Information

The Company owns and operates industrial properties nationally and owns and operates office properties in a focused group of office markets. Additionally, the Company owns certain assets in the United Kingdom. During the three months ended March 31, 2016, the Company realigned its reportable segments as follows:

• Carolinas/Richmond;

• Chicago/Milwaukee;

• Florida;

• Houston;

• Lehigh/Central PA;

• Minnesota;

• Philadelphia;

• Southeastern PA; and

• United Kingdom.

Certain other segments are aggregated into an "Other" category which includes the reportable segments: Arizona; Atlanta; Cincinnati/Columbus/Indianapolis; Dallas; DC Metro; New Jersey; Northern Virginia; Southern California; and other.

Comparative prior periods have been restated to reflect current segment disclosures.

The Company evaluates the performance of its reportable segments based on net operating income. Net operating income includes operating revenue from external customers, real estate taxes, amortization of lease transaction costs and other operating expenses which relate directly to the management and operation of the assets within each reportable segment.

The Company's accounting policies for the segments are the same as those used in the Company's consolidated financial statements. There are no material inter-segment transactions.

The operating information by reportable segment is as follows (in thousands):

		For the Three Months
		Ended March 31,
		2016			2015
Operating revenue
	Carolinas/Richmond	$	15,760		$	20,334
	Chicago/Milwaukee	10,193			9,793
	Florida	29,318			30,932
	Houston	14,766			12,324
	Lehigh/Central PA	34,243			33,554
	Minnesota	11,346			12,672
	Philadelphia	10,355			9,982
	Southeastern PA	25,883			39,238
	United Kingdom	3,552			3,725
	Other	34,998			34,398
Segment-level operating revenue		190,414			206,952
Reconciliation to total operating revenues
	Other	(274		)	(51		)
Total operating revenue		$	190,140		$	206,901
Net operating income
	Carolinas/Richmond	$	10,840		$	12,846
	Chicago/Milwaukee	6,793			6,743
	Florida	18,047			19,102
	Houston	8,833			7,221
	Lehigh/Central PA	24,202			22,971
	Minnesota	4,578			5,985
	Philadelphia	7,097			7,022
	Southeastern PA	13,751			20,988
	United Kingdom	2,405			2,516
	Other	22,825			22,176
Segment-level net operating income		119,371			127,570
Reconciliation to net income
	Interest expense	(31,412		)	(34,670		)
	Depreciation/amortization expense (1)	(39,798		)	(43,514		)
	Impairment - real estate assets	—			(15,739		)
	Gain on property dispositions	20,521			2,271
	Equity in earnings of unconsolidated joint ventures	4,914			6,906
	General and administrative expense (1)	(14,539		)	(12,574		)
	Income taxes (1)	(570		)	(707		)
	Other	576			2,319
Net income		$	59,063		$	31,862

(1) Excludes costs which are included in determining segment-level net operating income.

During the three months ended March 31, 2016, the Company acquired one operating property for a purchase price of $8.0 million. This property, comprising 73,000 square feet of leaseable space, is located in the Company's Chicago/Milwaukee reportable segment.

The Company's sales by reportable segment for the three months ended March 31, 2016 are as follows:

	Three months ended March 31, 2016
	Properties Sold	Square Feet (000s)	Gross Proceeds (000s)
Minnesota	1	92	$	9,200
Florida	6	574	111,828		(1)
Other	1	183	10,100
Total	8	849	$	131,128

(1) Includes gross proceeds from the sale of 3.5 acres of land.

One property totaling 198,000 square feet in the Company's Dallas reportable segment was considered held for sale as of March 31, 2016.

The Company's total assets by reportable segment as of March 31, 2016 and December 31, 2015 is as follows (in thousands):

	March 31, 2016		December 31, 2015
Carolinas/Richmond	$	477,932	$	467,098
Chicago/Milwaukee	438,204		429,390
Florida	781,322		874,352
Houston	520,639		522,285
Lehigh/Central PA	1,188,450		1,157,468
Minnesota	345,590		346,840
Philadelphia	475,495		444,889
Southeastern PA	448,560		448,523
United Kingdom	208,221		215,850
Other	1,570,906		1,586,481
Segment-level total assets	6,455,319		6,493,176
Corporate Other	62,979		64,453
Total assets	$	6,518,298	$	6,557,629