Segment Information

6 Months Ended

Jun. 30, 2017

Segment Reporting [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 six months ended June 30, 2017, the Company realigned its reportable segments as follows:

• Carolinas/Richmond;

• Chicago/Minneapolis;

• Florida;

• Houston;

• Lehigh/Central PA;

• 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; and Southern California.

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

The Company evaluates the performance of its reportable segments based on segment net operating income (“SNOI”). SNOI is defined as net operating income (rental revenue and operating expense reimbursements less property and real estate tax expenses) less 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):

		Three Months						Six Months
		Ended June 30,						Ended June 30,
		2017			2016			2017			2016
Operating revenue
	Carolinas/Richmond	$	18,225		$	16,174		$	36,282		$	31,934
	Chicago/Minneapolis	15,767			21,891			31,642			43,430
	Florida	14,482			27,798			28,730			57,115
	Houston	14,779			14,204			29,553			28,971
	Lehigh/Central PA	39,815			33,782			81,350			68,025
	Philadelphia	10,928			10,386			22,363			20,741
	Southeastern PA	15,127			24,343			29,742			50,226
	United Kingdom	3,262			3,525			6,431			7,077
	Other	32,166			34,444			62,538			69,441
Segment-level operating revenue		164,551			186,547			328,631			376,960
Reconciliation to total operating revenues
	Development service fee income	18,259			—			29,744			—
	Other	320			107			121			(165		)
Total operating revenue		$	183,130		$	186,654		$	358,496		$	376,795
SNOI
	Carolinas/Richmond	$	13,094		$	11,219		$	26,077		$	22,059
	Chicago/Minneapolis	10,011			11,872			19,360			23,243
	Florida	10,003			16,741			19,510			34,788
	Houston	7,761			8,036			14,562			16,869
	Lehigh/Central PA	29,083			24,755			58,661			48,957
	Philadelphia	8,475			7,981			17,234			15,339
	Southeastern PA	8,507			14,549			16,619			28,300
	United Kingdom	1,649			2,438			3,506			4,842
	Other	21,935			22,953			42,191			45,779
SNOI		110,518			120,544			217,720			240,176
Reconciliation to net income
	Interest expense	(21,942		)	(30,131		)	(44,285		)	(61,543		)
	Depreciation/amortization expense (1)	(33,115		)	(39,161		)	(66,308		)	(78,959		)
	Gain on property dispositions	5,895			3,832			6,702			24,353
	Equity in earnings of unconsolidated joint ventures	3,990			5,583			9,721			10,497
	General and administrative expense (1)	(11,047		)	(10,135		)	(23,301		)	(24,927		)
	Income taxes (1)	104			(653		)	(176		)	(1,222		)
	Other	(1,585		)	1,178			(3,011		)	1,745
Net income		$	52,818		$	51,057		$	97,062		$	110,120

(1) Excludes costs which are included in determining SNOI.

The Company's total assets by reportable segment as of June 30, 2017 and December 31, 2016 is as follows (in thousands):

	June 30, 2017		December 31, 2016
Carolinas/Richmond	$	512,329	$	503,920
Chicago/Minnesota	609,962		616,298
Florida	507,873		514,431
Houston	529,946		530,438
Lehigh/Central PA	1,350,454		1,311,815
Philadelphia	610,025		557,510
Southeastern PA	271,035		262,155
United Kingdom	227,793		189,766
Other	1,487,741		1,403,431
Segment-level total assets	6,107,158		5,889,764
Corporate Other	52,477		103,049
Total assets	$	6,159,635	$	5,992,813