Segment Information (Tables)

12 Months Ended

Dec. 31, 2018

Schedule of Segment Reporting Information

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



		Year ended
		December 31,
		2018			2017			2016
Operating revenue
	Carolinas/Richmond	$	79,271		$	74,158		$	66,270
	Chicago/Minneapolis	67,551			64,706			84,028
	Florida	64,486			59,526			99,733
	Houston	64,968			59,957			59,582
	Lehigh/Central PA	156,629			163,026			141,046
	Philadelphia	44,387			45,504			41,838
	Southeastern PA	27,874			59,762			91,656
	Southern California	30,939			13,856			11,019
	United Kingdom	17,193			13,917			13,376
	Other	134,553			116,868			125,502
Segment-level operating revenue		687,851			671,280			734,050

Reconciliation to total operating revenues
	Development service fee income ⁽¹⁾	73,224			82,673			12,941
	Discontinued operations	(56,056		)	(88,429		)	(71,385		)
	Other	(130		)	(140		)	(283		)
Total operating revenue		$	704,889		$	665,384		$	675,323

Net operating income
	Carolinas/Richmond	$	57,105		$	53,132		$	46,170
	Chicago/Minneapolis	40,781			39,231			45,258
	Florida	44,204			39,850			62,177
	Houston	37,766			32,300			32,499
	Lehigh/Central PA	114,201			119,304			102,209
	Philadelphia	36,216			35,279			30,862
	Southeastern PA	20,044			35,641			53,947
	Southern California	24,360			10,199			7,079
	United Kingdom	8,996			7,657			6,390
	Other	86,638			75,928			82,195
Segment-level net operating income		470,311			448,521			468,786

Reconciliation to income from continuing operations
	Interest expense ⁽²⁾	(95,442		)	(91,096		)	(115,077		)
	Loss on debt extinguishment	—			(49		)	(27,099		)
	Development service fee income	73,224			82,673			12,941
	Development service fee expense	(134,825		)	(85,805		)	(12,165		)
	Depreciation/amortization expense ^{(2) (3)}	(129,048		)	(132,613		)	(152,556		)
	Impairment - real estate assets ⁽²⁾	(39,688		)	(10,632		)	(3,879		)
	Gain on property dispositions	81,514			100,387			219,270
	Equity in earnings of unconsolidated joint ventures	21,382			17,155			21,970
	General and administrative expense ^{(2) (3)}	(37,278		)	(39,024		)	(40,090		)
	Other operating expenses ⁽³⁾	(10,835		)	(5,294		)	(4,418		)
	Discontinued operations excluding gain on property dispositions	(23,379		)	(26,661		)	(27,129		)
	Income taxes ⁽³⁾	(4,701		)	(240		)	47
	Other⁽⁴⁾	(5,170		)	(8,516		)	(1,585		)
Income from continuing operations		$	166,065		$	248,806		$	339,016

(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 in discontinued operations.

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

(4) Includes severance activity in 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,
	2018		2017		2016
Carolinas/Richmond	$	5,445	$	5,205	$	4,944
Chicago/Minneapolis	4,912		4,393		5,858
Florida	4,050		4,174		6,605
Houston	4,898		5,155		4,713
Lehigh/Central PA	13,121		14,475		12,262
Philadelphia	2,626		2,797		2,706
Southeastern PA	630		3,617		6,134
Southern California	850		612		367
United Kingdom	384		340		259
Other	9,109		8,509		8,687
Depreciation and amortization of tenant improvement and lease transaction costs	$	46,025	$	49,277	$	52,535

Schedule of 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, 2018, 2017 and 2016 is as follows (in thousands):



	Year Ended
	December 31, 2018							December 31, 2017							December 31, 2016
	Industrial		Office		Total			Industrial		Office		Total			Industrial		Office		Total
Carolinas/Richmond	$	79,271	$	—	$	79,271		$	74,158	$	—	$	74,158		$	66,270	$	—	$	66,270
Chicago/Minneapolis	63,393		4,158		67,551			60,826		3,880		64,706			65,007		19,021		84,028
Florida	61,878		2,608		64,486			56,923		2,603		59,526			66,028		33,705		99,733
Houston	64,968		—		64,968			58,606		1,351		59,957			58,370		1,212		59,582
Lehigh/Central PA	156,629		—		156,629			163,026		—		163,026			138,766		2,280		141,046
Philadelphia	11,923		32,464		44,387			11,914		33,590		45,504			12,842		28,996		41,838
Southeastern PA	4,139		23,735		27,874			8,925		50,837		59,762			19,448		72,208		91,656
Southern California	30,939		—		30,939			13,856		—		13,856			11,019		—		11,019
United Kingdom	13,601		3,592		17,193			10,369		3,548		13,917			10,775		2,601		13,376
Other	105,622		28,931		134,553			88,601		28,267		116,868			80,743		44,759		125,502
	$	592,363	$	95,488	687,851			$	547,204	$	124,076	671,280			$	529,268	$	204,782	734,050
Reconciliation to total operating revenue
Development service fee income					73,224							82,673							12,941
Discontinued operations					(56,056		)					(88,429		)					(71,385		)
Corporate other					(130		)					(140		)					(283		)
Total operating revenue					$	704,889						$	665,384						$	675,323

Reconciliation of Assets from Segment to Consolidated

The Company's total assets by reportable segment as of December 31, 2018 and 2017 is as follows (in thousands):



	As of December 31,
	2018		2017
Carolinas/Richmond	$	525,041	$	543,922
Chicago/Minneapolis	591,792		615,186
Florida	547,232		533,861
Houston	568,756		498,584
Lehigh/Central PA	1,210,220		1,210,746
Philadelphia	624,373		665,843
Southeastern PA	48,827		241,128
Southern California	660,688		362,122
United Kingdom	463,162		251,824
Other	1,497,629		1,445,531
Segment-level total assets	6,737,720		6,368,747
Corporate Other	196,674		71,010
Total assets	$	6,934,394	$	6,439,757

Schedule of Long-Lived Assets, by Geographical Areas

The Company's real estate assets by reportable segment as of December 31, 2018 and 2017 is as follows (in thousands):



	As of December 31,
	2018		2017
Carolinas/Richmond	$	495,149	$	491,916
Chicago/Minneapolis	545,919		557,782
Florida	492,797		483,355
Houston	509,100		456,675
Lehigh/Central PA	1,151,148		1,121,115
Philadelphia	286,568		279,338
Southeastern PA	15,467		19,357
Southern California	633,450		343,520
United Kingdom	347,886		191,552
Other	1,228,447		1,004,667
Total real estate assets	$	5,705,931	$	4,949,277

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, 2018, 2017 and 2016 (in thousands):



		Year Ended December 31,
		2018		2017		2016
Costs incurred on long-lived assets
	Carolinas/Richmond	$	22,220	$	31,958	$	51,647
	Chicago/Minneapolis	3,326		14,246		29,317
	Florida	41,967		23,832		38,312
	Houston	77,323		17,522		25,831
	Lehigh/Central PA	63,926		89,304		176,386
	Philadelphia	3,326		30,685		57,691
	Southeastern PA	5,118		9,737		4,824
	Southern California	298,580		183,842		5,599
	United Kingdom	165,276		10,501		11,492
	Other	240,476		220,411		101,901
Total costs incurred on long-lived assets		$	921,538	$	632,038	$	503,000