Segment Information (Tables)

12 Months Ended

Dec. 31, 2017

Schedule of Segment Reporting Information

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



		Year ended
		December 31,
		2017			2016			2015
Operating revenue
	Carolinas/Richmond	$	74,158		$	66,270		$	71,950
	Chicago/Minneapolis	64,706			84,028			85,363
	Florida	59,526			99,733			127,184
	Houston	59,957			59,582			54,031
	Lehigh/Central PA	163,026			141,046			133,473
	Philadelphia	45,504			41,838			40,490
	Southeastern PA	59,762			91,656			147,712
	United Kingdom	13,917			13,376			15,135
	Other	130,724			136,521			133,345
Segment-level operating revenue		671,280			734,050			808,683

Reconciliation to total operating revenues
	Development service fee income ⁽¹⁾	82,673			12,941			—
	Discontinued operations	(34,035		)	(36,010		)	(34,813		)
	Other	(140		)	(283		)	90
Total operating revenue		$	719,778		$	710,698		$	773,960

Net operating income
	Carolinas/Richmond	$	53,132		$	46,170		$	47,849
	Chicago/Minneapolis	39,231			45,258			44,963
	Florida	39,850			62,177			77,283
	Houston	32,300			32,499			31,159
	Lehigh/Central PA	119,304			102,209			94,972
	Philadelphia	35,279			30,862			29,679
	Southeastern PA	35,641			53,947			80,458
	United Kingdom	7,657			6,390			10,486
	Other	86,127			89,274			87,925
Segment-level net operating income		448,521			468,786			504,774

Reconciliation to income from continuing operations
	Interest expense ⁽²⁾	(91,096		)	(115,077		)	(135,779		)
	Loss on debt extinguishment	(49		)	(27,099		)	—
	Depreciation/amortization expense ^{(2) (3)}	(132,613		)	(152,556		)	(166,500		)
	Impairment - real estate assets ⁽²⁾	(10,632		)	(3,879		)	(18,244		)
	Gain on property dispositions	100,387			219,270			100,314
	Equity in earnings of unconsolidated joint ventures	17,155			21,970			3,149
	General and administrative expense ^{(2) (3)}	(45,191		)	(44,341		)	(43,924		)
	Expensed pursuit costs	(5,006		)	(1,016		)	(605		)
	Discontinued operations excluding gain on property dispositions	(4,401		)	(11,991		)	(10,565		)
	Income taxes ⁽³⁾	(240		)	47			(2,351		)
	Other	(5,769		)	40			5,090
Income from continuing operations		$	271,066		$	354,154		$	235,359

(1) Prior to the fourth quarter of 2016, development service fee income had been classified as other income and development service fee expense had been classified as general and administrative expense. See Note 2.

(2) Includes activity on discontinued operations.

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

Schedule of Depreciation and Amortization

The amount of depreciation and amortization expense related to tenant improvement and lease transaction costs within each reporting segment for the net operating income calculation is as follows (in thousands):



	Year ended
	December 31,
	2017		2016		2015
Carolinas/Richmond	$	5,061	$	4,944	$	5,307
Chicago/Minneapolis	4,306		5,858		6,147
Florida	4,084		6,605		9,407
Houston	5,071		4,713		4,466
Lehigh/Central PA	14,371		12,262		11,641
Philadelphia	2,754		2,706		2,220
Southeastern PA	3,582		6,134		12,346
United Kingdom	339		259		292
Other	9,843		9,792		8,249
Depreciation and amortization of tenant improvement and lease transaction costs	$	49,411	$	53,273	$	60,075

Revenue from External Customers by Products and Services

The Company's operating revenue by product type and by reportable segment for the years ended December 31, 2017, 2016 and 2015 is as follows (in thousands):



	Year Ended
	December 31, 2017							December 31, 2016							December 31, 2015
	Industrial		Office		Total			Industrial		Office		Total			Industrial		Office		Total
Carolinas/Richmond	$	74,158	$	—	$	74,158		$	66,270	$	—	$	66,270		$	62,075	$	9,875	$	71,950
Chicago/Minneapolis	60,826		3,880		64,706			65,007		19,021		84,028			62,152		23,211		85,363
Florida	56,923		2,603		59,526			66,028		33,705		99,733			67,149		60,035		127,184
Houston	58,606		1,351		59,957			58,370		1,212		59,582			53,802		229		54,031
Lehigh/Central PA	163,026		—		163,026			138,766		2,280		141,046			131,168		2,305		133,473
Philadelphia	11,914		33,590		45,504			12,842		28,996		41,838			11,809		28,681		40,490
Southeastern PA	8,925		50,837		59,762			19,448		72,208		91,656			28,457		119,255		147,712
United Kingdom	10,369		3,548		13,917			10,775		2,601		13,376			12,104		3,031		15,135
Other	102,457		28,267		130,724			91,762		44,759		136,521			86,180		47,165		133,345
	$	547,204	$	124,076	671,280			$	529,268	$	204,782	734,050			$	514,896	$	293,787	808,683
Reconciliation to total operating revenue
Development service fee income					82,673							12,941							—
Discontinued operations					(34,035		)					(36,010		)					(34,813		)
Corporate other					(140		)					(283		)					90
Total operating revenue					$	719,778						$	710,698						$	773,960

Reconciliation of Assets from Segment to Consolidated

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



	As of December 31,
	2017		2016
Carolinas/Richmond	$	543,922	$	503,920
Chicago/Minneapolis	615,186		616,298
Florida	533,861		514,431
Houston	498,584		530,438
Lehigh/Central PA	1,210,746		1,311,815
Philadelphia	665,843		557,510
Southeastern PA	241,128		262,155
United Kingdom	251,824		189,766
Other	1,807,653		1,403,431
Segment-level total assets	6,368,747		5,889,764
Corporate Other	71,010		103,049
Total assets	$	6,439,757	$	5,992,813

Schedule of Long-Lived Assets, by Geographical Areas

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



	As of December 31,
	2017		2016
Carolinas/Richmond	$	491,634	$	482,736
Chicago/Minneapolis	557,776		565,062
Florida	483,315		476,046
Houston	456,591		463,739
Lehigh/Central PA	1,118,802		1,234,091
Philadelphia	277,153		332,933
Southeastern PA	19,352		123,093
United Kingdom	191,542		149,082
Other	1,769,705		1,288,208
Total real estate assets	$	5,365,870	$	5,114,990

Schedule of Expenditures on Long-Lived Assets

The Company incurred the following costs related to its long-lived assets for the years ended December 31, 2017, 2016 and 2015 (in thousands):



		Year Ended December 31,
		2017		2016		2015
Costs incurred on long-lived assets
	Carolinas/Richmond	$	31,958	$	51,647	$	31,175
	Chicago/Minneapolis	14,246		29,317		54,742
	Florida	23,832		38,312		43,594
	Houston	17,522		25,831		98,559
	Lehigh/Central PA	89,304		176,386		165,319
	Philadelphia	30,685		57,691		34,122
	Southeastern PA	9,737		4,824		5,700
	United Kingdom	10,501		11,492		12,960
	Other	404,253		107,500		125,412
Total costs incurred on long-lived assets		$	632,038	$	503,000	$	571,583