Unconsolidated Joint Ventures

6 Months Ended

Jun. 30, 2016

Equity Method Investments and Joint Ventures [Abstract]

Equity Method Investments and Joint Ventures Disclosure [Text Block]

Unconsolidated Joint Ventures

Liberty Washington, LP

During the six months ended June 30, 2016, Liberty Washington LP (a joint venture in which the Company holds a 25% interest) sold three properties located in Northern Virginia containing 601,000 square feet for $80.5 million.

In addition, due to adverse conditions in the Northern Virginia office market, the fair value of two properties owned by the joint venture containing 248,000 square feet were determined to be less than the debt encumbering the properties. As a result, during the three months ended June 30, 2016, the joint venture entered into an arrangement with the mortgage lender to allow a transfer of the two properties to the lender by way of an uncontested trustee sale in satisfaction of nonrecourse mortgage debt totaling $46.4 million. The book values of these properties were written down to fair value in a prior period.

During the six months ended June 30, 2016, due to market conditions similar to those discussed above, six properties (including the two properties discussed above) containing 698,000 square feet were transferred to mortgage lenders in satisfaction of an aggregate of $112.5 million in nonrecourse mortgage loans that were secured by the properties. The book values of these properties were written down to fair value in prior periods.

The Company's share of gain from property dispositions and extinguishment of debt is included in equity in earnings (loss) of unconsolidated joint ventures in the accompanying consolidated statements of comprehensive income. During the three and six months ended June 30, 2016 the Company's share of gain from extinguishment of debt was $3.3 million and $4.2 million, respectively, and its share of gain on property dispositions was $158,000 and $2.0 million, respectively.

Because these loans were nonrecourse, the Company believes that the transfers described above will not have an ongoing effect on its operating results or financial condition.