UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q



þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~June 30, 2017~~March 31, 2018



o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-11312

COUSINS PROPERTIES INCORPORATED

(Exact name of registrant as specified in its charter)



GEORGIA (State or other jurisdiction of incorporation or organization)	58-0869052 (I.R.S. Employer Identification No.)
3344 Peachtree Road NE, Suite 1800, Atlanta, Georgia (Address of principal executive offices)	30326-4802 (Zip Code)
~~Former Address~~ ~~(191 Peachtree Street, Suite 500, Atlanta, Georgia 30308-1740)~~

(404) 407-1000

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and "emerging growth company" in Rule 12b-2 of the Exchange Act.



Large accelerated filerþ	ý	Accelerated filer	~~Accelerated filer~~ o¨	~~Non-accelerated filer~~ o	~~Smaller reporting company~~ o
Non-accelerated filer		~~(Do~~ o (Do not check if a smaller reporting company)	Smaller reporting company	¨
		Emerging growth companyo	¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No þ

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.



Class		Outstanding at ~~July 20, 2017~~April 18, 2018
Common Stock, $1 par value per share		~~419,992,589~~420,243,611 shares

Table of Contents

FORWARD-LOOKING STATEMENTS

Certain matters contained in this report are “forward-looking statements” within the meaning of the federal securities laws and are subject to uncertainties and risks, as itemized in Item 1A included in the Annual Report on Form 10-K for the year ended December 31, ~~2016~~2017 and as itemized herein. These forward-looking statements include information about possible or assumed future results of the business and our financial condition, liquidity, results of operations, plans, and objectives. They also include, among other things, statements regarding subjects that are forward-looking by their nature, such as:

our 2018 guidance and underlying assumptions;

business and financial strategy;

•~~our ability to obtain~~ future ~~financing;~~financings;

•future acquisitions of land;

•future acquisitions and dispositions of operating assets;

•~~future acquisitions of land;~~

•future development and redevelopment opportunities;

•future dispositions of land and other non-core assets;

•future issuances and repurchases of common or preferred stock;

•projected operating results;

•market and industry trends;

•future distributions;

•future projected capital expenditures;

•future interest rates; and

the impact of the transaction involving us, Parkway Properties, Inc. ("Parkway"), and Parkway, Inc. ("New Parkway"), including future financial and operating results, plans, objectives, expectations, and intentions;

all statements that address operating performance, events, or developments that we expect or anticipate will occur in the future — including statements relating to creating value for ~~stockholders;~~

~~impact of the transactions with Parkway and New Parkway on tenants, employees, stockholders, and other constituents of the combined companies; and~~

~~integrating Parkway with us.~~stockholders.

Any forward-looking statements are based upon management's beliefs, assumptions, and expectations of our future performance, taking into account information currently available. These beliefs, assumptions, and expectations may change as a result of possible events or factors, not all of which are known. If a change occurs, our business, financial condition, liquidity, and results of operations may vary materially from those expressed in forward-looking statements. Actual results may vary from forward-looking statements due to, but not limited to, the following:

the availability and terms of capital;

the ability to refinance or repay indebtedness as it matures;

the failure of purchase, sale, or other contracts to ultimately close;

the failure to achieve anticipated benefits from acquisitions, investments, or dispositions;

the potential dilutive effect of common stock or operating partnership unit issuances;

the ~~failure to achieve benefits from the repurchase of common stock;~~

~~the~~ availability of buyers and pricing with respect to the disposition of assets;

risks and uncertainties related to national and local economic conditions, the real estate industry, and the commercial real estate markets in which we operate, particularly in Atlanta, Charlotte, Austin, Phoenix, and ~~Austin~~Tampa where we have high concentrations of our ~~annualized~~ lease revenue;

changes to our strategy with regard to land and other non-core holdings that ~~may~~ require impairment losses to be recognized;

leasing risks, including the ability to obtain new tenants or renew expiring tenants, the ability to lease newly developed and/or recently acquired space, and the risk of declining leasing rates;

the adverse change in the financial condition of one or more of our major tenants;

volatility in interest rates and insurance rates;

competition from other developers or investors;

the risks associated with real estate developments (such as zoning approval, receipt of required permits, construction delays, cost overruns, and leasing risk);

the loss of key personnel;

the potential liability for uninsured losses, condemnation, or environmental issues;

the potential liability for a failure to meet regulatory requirements;

the financial condition and liquidity of, or disputes with, joint venture partners;

any failure to comply with debt covenants under credit agreements;

any failure to continue to qualify for taxation as a real estate investment trust and to meet regulatory requirements;

~~risks associated with litigation resulting from the transactions with Parkway and from liabilities or contingent liabilities assumed in the transactions with Parkway;~~

~~Table of Contents~~

~~risks associated with any errors or omissions in financial or other information of Parkway that has been previously provided to the public;~~

~~the ability to successfully integrate our operations and employees in connection with the transactions with Parkway and New Parkway;~~

~~the ability to realize anticipated benefits and synergies of the transactions with Parkway and New Parkway;~~

potential changes to state, local, or federal regulations applicable to our business;

material changes in the dividend rates ~~on securities~~ or the ability to pay dividends on common shares or other securities;

potential changes to the tax laws and accounting standards impacting REITs and real estate in general;

~~significant costs related to uninsured losses, condemnation, or environmental issues;~~ and

those additional risks and factors discussed in reports filed with the Securities and Exchange Commission by the Company.

The words “believes,” “expects,” “anticipates,” “estimates,” “plans,” “may,” “intend,” “will,” or similar expressions are intended to identify forward-looking statements. Although we believe that our plans, intentions, and expectations reflected in any forward-looking statements are reasonable, we can give no assurance that such plans, intentions, or expectations will be achieved. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of future events, new information, or otherwise, except as required under U.S. federal securities laws.

Table of Contents

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements.

COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share amounts)	COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share amounts)						COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share amounts)

	June 30, 2017			December 31, 2016			March 31, 2018			December 31, 2017
	(unaudited)						(unaudited)
Assets:
Real estate assets:
Operating properties, net of accumulated depreciation of $217,925 and $215,856 in 2017 and 2016, respectively	$	3,479,262		$	3,432,522
Operating properties, net of accumulated depreciation of $311,238 and $275,977 in 2018 and 2017, respectively							$	3,528,617		$	3,332,619
Projects under development	203,562			162,387			81,964			280,982
Land	4,221			4,221			4,221			4,221
	3,687,045			3,599,130			3,614,802			3,617,822

Cash and cash equivalents	16,420			35,687			108,152			148,929
Restricted cash	8,139			15,634			1,185			56,816
Notes and accounts receivable, net of allowance for doubtful accounts of $1,425 and $1,167 in 2017 and 2016, respectively	20,530			27,683
Notes and accounts receivable, net of allowance for doubtful accounts of $298 and $535 in 2018 and 2017, respectively							16,668			14,420
Deferred rents receivable	47,240			39,464			65,995			58,158
Investment in unconsolidated joint ventures	101,532			179,397			145,465			101,414
Intangible assets, net of accumulated amortization of $85,341 and $53,483 in 2017 and 2016, respectively	225,860			245,529
Intangible assets, net							175,159			186,206
Other assets	29,280			29,083			31,884			20,854
Total assets	$	4,136,046		$	4,171,607		$	4,159,310		$	4,204,619
Liabilities:
Notes payable	$	1,019,619		$	1,380,920		$	1,091,258		$	1,093,228
Accounts payable and accrued expenses	128,772			109,278			87,964			137,909
Deferred income	34,743			33,304			37,895			37,383
Intangible liabilities, net of accumulated amortization of $21,543 and $12,227 in 2017 and 2016, respectively	80,466			89,781
Intangible liabilities, net of accumulated amortization of $32,503 and $28,960 in 2018 and 2017, respectively							66,911			70,454
Other liabilities	42,769			44,084			39,367			40,534
Total liabilities	1,306,369			1,657,367			1,323,395			1,379,508
Commitments and contingencies
Equity:
Stockholders' investment:
Preferred stock, $1 par value, 20,000,000 shares authorized, 6,867,357 shares issued and outstanding in 2017 and 2016	6,867			6,867
Common stock, $1 par value, 700,000,000 shares authorized, 430,296,523 and 403,746,938 shares issued in 2017 and 2016, respectively	430,297			403,747
Preferred stock, $1 par value, 20,000,000 shares authorized, 6,867,357 shares issued and outstanding in 2018 and 2017							6,867			6,867
Common stock, $1 par value, 700,000,000 shares authorized, 430,572,693 and 430,349,620 shares issued in 2018 and 2017, respectively							430,573			430,350
Additional paid-in capital	3,604,036			3,407,430			3,604,336			3,604,776
Treasury stock at cost, 10,329,082 shares in 2017 and 2016	(148,373		)	(148,373		)
Treasury stock at cost, 10,329,082 shares in 2018 and 2017							(148,373		)	(148,373		)
Distributions in excess of cumulative net income	(1,114,662		)	(1,214,114		)	(1,110,590		)	(1,121,647		)
Total stockholders' investment	2,778,165			2,455,557			2,782,813			2,771,973
Nonredeemable noncontrolling interests	51,512			58,683			53,102			53,138
Total equity	2,829,677			2,514,240			2,835,915			2,825,111
Total liabilities and equity	$	4,136,046		$	4,171,607		$	4,159,310		$	4,204,619

See accompanying notes.

Table of Contents

COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(~~unaudited,~~unaudited; in thousands, except per share amounts)


	Three Months Ended						Six Months Ended						Three Months Ended
	June 30,						June 30,						March 31,
	2017			2016			2017			2016			2018			2017
Revenues:
Rental property revenues	$	114,007		$	46,454		$	226,524		$	91,807		$	113,348		$	112,517
Fee income	1,854			1,824			3,791			4,023			2,894			1,936
Other	3,174			27			8,600			417			960			5,426
	119,035			48,305			238,915			96,247			117,202			119,879
Costs and expenses:
Expenses:
Rental property operating expenses	41,501			19,526			83,026			37,330			40,191			41,526
Reimbursed expenses	907			798			1,772			1,668			942			865
General and administrative expenses	8,618			4,691			14,828			12,934			6,809			6,182
Interest expense	8,523			5,369			18,264			10,808			9,778			9,741
Depreciation and amortization	50,040			16,641			104,924			33,182			45,093			54,884
Acquisition and transaction costs	246			2,424			2,177			2,443			91			1,930
Other	236			152			612			507			320			404
	110,071			49,601			225,603			98,872			103,224			115,532
Gain on extinguishment of debt	1,829			—			1,829			—
Income (loss) from continuing operations before unconsolidated joint ventures and gain (loss) on sale of investment properties	10,793			(1,296		)	15,141			(2,625		)
Loss on extinguishment of debt													(85		)	—
Income from continuing operations before unconsolidated joint ventures and loss on sale of investment properties													13,893			4,347
Income from unconsolidated joint ventures	40,320			1,784			40,901			3,618			2,885			581
Income from continuing operations before gain (loss) on sale of investment properties	51,113			488			56,042			993
Gain (loss) on sale of investment properties	119,832			(246		)	119,761			13,944
Income from continuing operations	170,945			242			175,803			14,937
Income from discontinued operations	—			7,523			—			15,624
Income from continuing operations before gain on sale of investment properties													16,778			4,928
Loss on sale of investment properties													(372		)	(70		)
Net income	170,945			7,765			175,803			30,561			16,406			4,858
Net income attributable to noncontrolling interests	(2,856		)	—			(2,963		)	—			(363		)	(107		)
Net income available to common stockholders	$	168,089		$	7,765		$	172,840		$	30,561		$	16,043		$	4,751
Per common share information — basic and diluted:
Income from continuing operations	$	0.40		$	—		$	0.42		$	0.07
Income from discontinued operations	—			0.04			—			0.08
Net income	$	0.40		$	0.04		$	0.42		$	0.15
Net income per common share — basic and diluted													$	0.04		$	0.01
Weighted average shares — basic	419,402			210,129			411,137			210,516			420,154			402,781
Weighted average shares — diluted	427,180			210,362			419,227			210,687			427,695			411,186
Dividends declared per common share	$	0.06		$	0.08		$	0.18		$	0.16		$	0.065		$	0.120

See accompanying notes.

Table of Contents

COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

~~Six~~Three Months Ended ~~June 30,~~March 31, 2018 and 2017 ~~and 2016~~

(unaudited, in thousands)

Preferred
Stock
Common
Stock

Additional
Paid-In
Capital

Treasury
Stock

Distributions in
Excess of
Net Income

Stockholders’
Investment

Nonredeemable
Noncontrolling
Interests

Total
Equity
Balance December 31, 2016 $ 6,867
$ 403,747
$ 3,407,430
$ (148,373 ) $ (1,214,114 ) $ 2,455,557
$ 58,683
$ 2,514,240
Net income —
—
—
—
172,840
172,840
2,963
175,803
Common stock issued pursuant to:
Common stock offering, net of
issuance costs —
25,000
186,820
—
—
211,820
—
211,820
Director stock grants —
121
889
—
—
1,010
—
1,010
Stock based compensation —
232
(943 ) —
—
(711 ) —
(711 )
Spin-off of Parkway, Inc. —
—
—
—
562
562
—
562
Common stock redemption by unit holders —
1,203
8,865
—
—
10,068
(10,068 ) —
Amortization of stock options and restricted stock, net of forfeitures —
(6 ) 975
—
—
969
—
969
Contributions from nonredeemable noncontrolling interest —
—
—
—
—
—
900
900
Distributions to nonredeemable noncontrolling interest —
—
—
—
—
—
(966 ) (966 )
Common dividends ($0.18 per share) —
—
—
—
(73,950 ) (73,950 ) —
(73,950 )
Balance June 30, 2017 $ 6,867
$ 430,297
$ 3,604,036
$ (148,373 ) $ (1,114,662 ) $ 2,778,165
$ 51,512
$ 2,829,677

Balance December 31, 2015 $ —
$ 220,256
$ 1,722,224
$ (134,630 ) $ (124,435 ) $ 1,683,415
$ —
$ 1,683,415
Net income —
—
—
—
30,561
30,561
—
30,561
Common stock issued pursuant to stock based compensation —
258
81
—
—
339
—
339
Amortization of stock options and restricted stock, net of forfeitures —
(13 ) 826
—
—
813
—
813
Contributions from nonredeemable noncontrolling interests —
—
—
—
—
—
1,473
1,473
Repurchase of common stock —
—
—

(13,743 ) —
(13,743 ) —
(13,743 )
Common dividends ($0.16 per share) —
—
—
—
(33,728 ) (33,728 ) —
(33,728 )
Balance June 30, 2016 $ —
$ 220,501
$ 1,723,131
$ (148,373 ) $ (127,602 ) $ 1,667,657
$ 1,473
$ 1,669,130



	Preferred Stock		Common Stock			Additional Paid-In Capital			Treasury Stock			Distributions in Excess of Net Income			Stockholders’ Investment			Nonredeemable Noncontrolling Interests			Total Equity
Balance December 31, 2017	$	6,867	$	430,350		$	3,604,776		$	(148,373	)	$	(1,121,647	)	$	2,771,973		$	53,138		$	2,825,111
Net income	—		—			—			—			16,043			16,043			363			16,406
Common stock issued pursuant to stock-based compensation	—		232			(991		)	—			—			(759		)	—			(759		)
Cumulative effect of change in accounting principle	—		—			—			—			22,329			22,329			—			22,329
Amortization of stock options and restricted stock, net of forfeitures	—		(9		)	551			—			—			542			—			542
Distributions to nonredeemable noncontrolling interest	—		—			—			—			—			—			(399		)	(399		)
Common dividends ($0.065 per share)	—		—			—			—			(27,315		)	(27,315		)	—			(27,315		)
Balance March 31, 2018	$	6,867	$	430,573		$	3,604,336		$	(148,373	)	$	(1,110,590	)	$	2,782,813		$	53,102		$	2,835,915

Balance December 31, 2016	$	6,867	$	403,747		$	3,407,430		$	(148,373	)	$	(1,214,114	)	$	2,455,557		$	58,683		$	2,514,240
Net income	—		—			—			—			4,751			4,751			107			4,858
Common stock issued pursuant to:
Common stock offering, net of issuance costs	—		25,000			186,825			—			—			211,825			—			211,825
Stock-based compensation	—		231			(932		)	—			—			(701		)	—			(701		)
Spin-off of Parkway, Inc.	—		—			—			—			404			404			—			404
Common stock redemption by unit holders	—		251			1,766			—			—			2,017			(2,017		)	—
Amortization of stock options and restricted stock, net of forfeitures	—		(3		)	492			—			—			489			—			489
Contributions from nonredeemable noncontrolling interests	—		—			—			—			—			—			630			630
Distributions to nonredeemable noncontrolling interest	—		—			—			—			—			—			(491		)	(491		)
Common dividends ($0.12 per share)	—		—			—			—			(48,738		)	(48,738		)	—			(48,738		)
Balance March 31, 2017	$	6,867	$	429,226		$	3,595,581		$	(148,373	)	$	(1,257,697	)	$	2,625,604		$	56,912		$	2,682,516

See accompanying notes.

Table of Contents

COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in thousands)


	Six Months Ended June 30,						Three Months Ended March 31,
	2017			2016			2018			2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	175,803		$	30,561		$	16,406		$	4,858
Adjustments to reconcile net income to net cash provided by operating activities:
Gain on sale of investment properties	(119,761		)	(13,944		)
Depreciation and amortization, including discontinued operations	104,924			64,350
Loss on sale of investment properties							372			70
Depreciation and amortization							45,093			54,884
Amortization of deferred financing costs and premium/discount on notes payable	(2,948		)	699			552			(2,748		)
Stock-based compensation expense, net of forfeitures	1,979			1,153			542			489
Effect of certain non-cash adjustments to rental revenues	(24,057		)	(9,656		)
Effect of non-cash adjustments to rental revenues							(9,996		)	(13,333		)
Income from unconsolidated joint ventures	(40,901		)	(3,618		)	(2,885		)	(581		)
Operating distributions from unconsolidated joint ventures	39,982			4,209			2,564			2,930
Gain on extinguishment of debt	(1,829		)	—
Loss on extinguishment of debt							85			—
Changes in other operating assets and liabilities:
Change in other receivables and other assets, net	3,108			(5,188		)	(7,094		)	(5,362		)
Change in operating liabilities	(10,063		)	(8,472		)
Change in operating liabilities, net							(24,733		)	(15,974		)
Net cash provided by operating activities	126,237			60,094			20,906			25,233
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from investment property sales	167,118			21,088
Property acquisition, development, and tenant asset expenditures	(151,150		)	(75,594		)	(60,175		)	(70,711		)
Purchase of tenant in common interest	(13,382		)	—
Purchase of tenant-in-common interest							—			(13,382		)
Collection of notes receivable	5,161			—			—			3,292
Investment in unconsolidated joint ventures	(8,266		)	(22,281		)	(21,613		)	(1,535		)
Distributions from unconsolidated joint ventures	40,939			4,099			242			4,065
Change in restricted cash	7,495			(876		)
Net cash provided by (used in) investing activities	47,915			(73,564		)
Change in notes receivable and other assets							(795		)	—
Other							(472		)	—
Net cash used in investing activities							(82,813		)	(78,271		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from credit facility	457,000			163,700			—			93,000
Repayment of credit facility	(497,000		)	(100,700		)	—			(227,000		)
Proceeds from issuance of notes payable	100,000			—
Repayment of notes payable	(413,726		)	(4,589		)	(2,161		)	(3,107		)
Payment of deferred financing costs	(2,030		)	—			(6,013		)	—
Shares withheld for payment of taxes on restricted stock vesting	(701		)	—			(759		)	—
Common stock issued, net of expenses	211,820			—			—			211,825
Contributions from noncontrolling interests	900			1,473
Distributions to nonredeemable noncontrolling interests	(966		)	—			(399		)	—
Repurchase of common stock	—			(13,743		)
Common dividends paid	(48,815		)	(33,728		)	(25,169		)	(23,603		)
Other	99			—			—			(158		)
Net cash provided by (used in) financing activities	(193,419		)	12,413			(34,501		)	50,957
NET DECREASE IN CASH AND CASH EQUIVALENTS	(19,267		)	(1,057		)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	35,687			2,003
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	16,420		$	946
NET DECREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH							(96,408		)	(2,081		)
CASH , CASH EQUIVALENTS, AND RESTRICTED CASH AT BEGINNING OF PERIOD							205,745			51,321
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT END OF PERIOD							$	109,337		$	49,240

Interest paid, net of amounts capitalized	$	22,721		$	14,131

Significant non-cash transactions:
Transfer from investment in unconsolidated joint ventures to operating properties	68,390			—
Transfer from projects under development to operating properties	58,928			—
Common stock dividends declared	25,212			—
Transfer from investment in unconsolidated joint ventures to projects under development	—			5,880
Change in accrued property acquisition, development, and tenant asset expenditures	(1,110		)	3,891

See accompanying notes.

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COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~June 30, 2017~~March 31, 2018

(Unaudited)

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Description of ~~Business~~

Business:Cousins Properties Incorporated (“Cousins”), a Georgia corporation, is a self-administered and self-managed real estate investment trust (“REIT”). Cousins conducts substantially all of its ~~operations~~business through Cousins Properties, LP ("CPLP"). Cousins owns approximately 98% of CPLP and consolidates CPLP. CPLP owns Cousins TRS Services LLC ("CTRS"), ~~which is wholly owned by CPLP, is~~ a taxable entity which owns and manages its own real estate portfolio and performs certain real estate related services for other parties.

Cousins, CPLP, CTRS, and their subsidiaries ~~are hereinafter referred to collectively as "the Company."~~

~~The Company develops, acquires, leases, manages,~~(collectively, the “Company”) develop, acquire, lease, manage, and ~~owns~~own primarily Class A office and mixed-use properties in Sunbelt markets with a focus on Georgia, Texas, Arizona, Florida, ~~Georgia,~~and North ~~Carolina,~~Carolina. As of March 31, 2018, the Company’s portfolio of real estate assets consisted of interests in 14.7 million square feet of office space and ~~Texas. Cousins has elected to be taxed as a REIT and intends to, among other things, distribute 100%~~310,000 square feet of its net taxable income to stockholders, thereby eliminating any liability for federal income taxes under current law. Therefore, the results included herein do not include a federal income tax provision for Cousins.mixed-use space.

Basis of ~~Presentation~~

Presentation:The condensed consolidated financial statements are unaudited and were prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”). In the opinion of management, these financial statements reflect all adjustments necessary (which adjustments are of a normal and recurring nature) for the fair presentation of the Company's financial position as of ~~June 30, 2017~~March 31, 2018 and the results of operations for the three ~~and six~~ months ended ~~June 30, 2017~~March 31, 2018 and ~~2016~~.2017. The results of operations for the three ~~and six~~ months ended ~~June 30, 2017~~March 31, 2018 are not necessarily indicative of results expected for the full ~~year.~~year or any other interim period. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2017. The accounting policies employed are substantially the same as those shown in note 2 to the consolidated financial statements included therein.

For the three ~~and six~~ months ended ~~June 30,~~March 31, 2018 and 2017, ~~and~~ ~~2016~~, there were no items of other comprehensive income. Therefore, no presentation of comprehensive income is required.

Recently Issued Accounting Standards

: In May 2014, the FASB issued ASU 2014-09 ("ASC 606"), "Revenue from Contracts with Customers." Under the new guidance, companies ~~will~~are required to recognize revenue when the seller satisfies a performance obligation, which would be when the buyer takes control of the good or service. ~~ASU 2015-14, "Revenue from Contracts with Customers," was subsequently issued modifying~~The Company adopted this guidance using the “modified retrospective” method effective ~~date to periods beginning after December 15, 2017, with early adoption permitted for periods beginning after December 15, 2016. The standard allows for either "full retrospective" adoption, meaning~~January 1, 2018; as such, the ~~standard is~~Company applied ~~to all of~~ the ~~periods presented, or "modified retrospective" adoption, meaning the standard is applied~~guidance only to the most recent period presented in the financial statements. The ~~Company expects to adopt this guidance effective~~classification of certain non-lease components of revenue from leases may be impacted by the new revenue standard upon the adoption of the new leasing standard beginning January 1, 2019 (see below). Prior to adoption of ASC 606, gains or losses from real estate sales were adjusted at the time of the sale by the maximum exposure to loss related to continuing involvement with the real estate asset. After adoption, any continuing involvement is considered a separate performance obligation and the sales price is required to be allocated between the elements with continuing involvement and those without continuing involvement. As the continuing performance obligations are satisfied, additional gains or losses will be recognized. The Company had no sales of real estate with continuing involvement during the first quarter of 2018 or in any prior periods that affected results of operations in the first quarter of 2018 or could effect results of operations in future periods.

The Company categorizes its primary sources of revenue into revenue from contracts with customers and other revenue accounted for as leases under Accounting Standards Codification Topic 840 - Leases ("ASC 840") as follows:

Rental property revenue consists of (1) contractual revenues from leases recognized on a straight-line basis over the term of the respective lease; (2) percentage rents recognized once a specified sales target is achieved; (3) parking revenue; and (4) the reimbursement of the tenants' share of real estate taxes, insurance, and other operating expenses. Rental property revenue is accounted for in accordance with the guidance set forth in ASC 840.

Fee revenue consists of development fees, management fees, and leasing fees earned from unconsolidated joint ventures and from third parties. Fee revenue is revenue from contracts with customers and is accounted for in accordance with the ~~process~~guidance set forth in ASC 606.

Other revenue consists primarily of ~~analyzing~~termination fees, which are accounted for in accordance with the ~~impact~~guidance set forth in ASC 840.

Fee revenue and other revenue, as a whole, are immaterial to total revenues. There was no change to previously reported amounts from the cumulative effect of the adoption of ~~this guidance. The new guidance specifically excludes~~ASC 606. For the three months ended March 31, 2018 and 2017, the

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Company recognized rental property revenue ~~associated with lease contracts. This new guidance could result in different amounts~~ of ~~revenue being recognized~~$113.3 million and ~~could result in revenue being recognized in different reporting periods than under~~$112.5 million, respectively. For the ~~current guidance; however,~~three months ended March 31, 2018 and 2017, the Company ~~expects that the majority~~recognized fee and other revenue of its non-lease revenues will continue to be recognized during the periods in which services are performed. The Company expects to adopt this guidance using the "modified retrospective" method effective January 1, 2018. The Company is still analyzing potential disclosures that will clearly identify the sources of revenue$3.9 million and ~~the periods over which each is recognized.~~$7.4 million, respectively.

In February 2016, the FASB issued ASU 2016-02, "Leases," which amends the existing standards for lease accounting by requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting and reporting. The new standard will require lessees to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months and classify such leases as either finance or operating leases based on the principle of whether ~~or not~~ the lease is effectively a financed purchase of the leased asset by the lessee. This classification will determine whether the lease expense is recognized based on an effective interest method (finance leases) or on a straight-line basis over the term of the lease (operating leases). Leases with a term of 12 months or less will be accounted for ~~similar~~similarly to existing guidance for operating leases. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases, and operating leases. ASU 2016-02 supersedes previous leasing standards. The guidance is effective for the fiscal years beginning after December 15, 2018, with early adoption permitted. The Company expects to adopt

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this guidance using the "modified retrospective" method effective January 1, 2019, and is currently assessing the potential impact of adopting the new guidance.

In ~~August 2016,~~ the ~~FASB issued~~fourth quarter of 2017, the Company adopted ASU 2016-15, "Classification of Certain Cash Receipts and Cash Payments" ("ASU 2016-15") which updated ASC Topic 230, "Statement of Cash Flows." ASU 2016-15 ~~clarifies~~clarified guidance on the classification of certain cash receipts and payments in the statement of cash flows to reduce diversity in practice with respect to (i) debt prepayment or debt extinguishment costs, (ii) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing, (iii) contingent consideration payments made after a business combination, (iv) proceeds from the settlement of insurance claims, (v) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies, (vi) distributions received from equity method investees, (vii) beneficial interests in securitization transactions, and (viii) separately identifiable cash flows and application of the predominance principle. ~~ASU 2016-15 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2017, with early adoption permitted.~~ The Company ~~will adopt~~adopted this ~~ASU~~standard with retrospective application to the consolidated statements of cash flows. The Company elected to use the nature of distributions approach for distributions from its equity method investments, under which it classifies the distribution received on the basis of the nature of the activity that generated the distribution. The adoption of this new approach resulted in ~~2018.~~an increase in net cash provided by operating activities of $2.1 million and a corresponding increase in net cash used in investing activities of $2.1 million for the three months ended March 31, 2017.

In ~~November 2016,~~ the ~~FASB issued~~fourth quarter of 2017, the Company adopted ASU 2016-18, "Restricted Cash" ("ASU 2016-18"), which updated ASC Topic 230, "Statement of Cash Flows." ASU 2016-18 ~~will require~~required companies to include restricted cash and restricted cash equivalents with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. ~~This update is effective for interim and annual reporting periods~~The adoption of this standard resulted in ~~fiscal years beginning after December 15, 2017, with early adoption permitted.~~

~~Effective January 1, 2017, the Company adopted ASU 2016-09, "Improvements to Employee Share-Based Payment Accounting." Under this ASU, the additional paid-in capital pool is eliminated, and~~ an ~~entity recognizes all excess tax benefits and tax deficiencies as income tax expense or benefit~~increase in the income statement. This ASU also eliminated the requirement to defer recognition of an excess tax benefit until all benefits are realized through a reduction to taxes payable. In the first quarter of 2017, the Company changed the treatment of excess tax benefits as operatingnet cash flows in the statement of cash flows. This ASU also stipulates that cash payments to tax authorities in connection with shares withheld to meet statutory tax withholding requirements be presented as a financing activity in the statement of cash flows. This ASU was adopted prospectively effective January 1, 2017; therefore, prior periods have not been restated to conform to the current period presentation.

~~In January 2017, the FASB issued ASU 2017-01, "Clarifying the Definition of a Business," which provides a more narrow definition of a business to be~~ used in ~~determining the accounting treatment~~investing activities of an acquisition. As a result, many acquisitions that previously qualified as business combinations will be treated as asset acquisitions. For asset acquisitions, acquisition costs may be capitalized, and the purchase price may be allocated on a relative fair value basis. ASU 2017-01 is effective prospectively$2.1 million for the ~~Company on~~three months ended March 31, 2017.

On January 1, 2018, ~~with early adoption permitted. The Company expects that most of its future acquisitions will qualify as asset acquisitions.~~

~~In February 2017,~~ the ~~FASB issued~~company adopted ASU No. 2017-05, “Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial ~~Assets”~~Assets (“ASU 2017-05”).” ASU 2017-05 ~~updates~~updated the definition of an “in substance nonfinancial asset” and ~~clarifies~~clarified the derecognition guidance for nonfinancial assets to conform with the new revenue recognition standard. Among other things, ASU 2017-05 requires companies to recognize 100% of the gain on the transfer of a nonfinancial asset to an entity in which it has a noncontrolling interest. The Company ~~is currently assessing the potential impact that the adoption of ASU 2017-05 will have on its consolidated financial statements.~~ ~~This ASU is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2017. The Company expects to adopt~~adopted this guidance using the "modified retrospective" ~~method effective~~method. As a result of the adoption of ASU 2017-05, the Company recorded a cumulative effect from change in accounting principle, which credited distributions in excess of cumulative net income by $22.3 million. This cumulative effect adjustment resulted from the 2013 transfer of a wholly-owned property to an entity in which it had a noncontrolling interest.

On January 1, ~~2018.~~

~~In May 2017, FASB issued~~2018, the Company adopted ASU 2017-09, "Scope of Modification ~~Accounting",~~Accounting," which ~~amends~~amended the scope of modification accounting for share-based payment arrangements and ~~provides~~provided guidance on the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under ASC ~~718. This update is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2017, with early adoption permitted.~~718, "Compensation—Stock Compensation." Adoption of the standard did not impact the Company's financial statements.

2.~~REAL ESTATE TRANSACTIONS~~

On June 15, 2017, The American Cancer Society Center (the “ACS Center”), a 996,000 square foot office building in Atlanta, Georgia that was included in the Company's Atlanta/Office operating segment, was sold for a gross purchase price of $166.0 million. The Company recognized a net gain of $119.8 million on the sale of the ACS Center. The associated debt was repaid on the date of sale.

3. ~~TRANSACTIONS WITH PARKWAY PROPERTIES, INC.~~

On October 6, 2016, pursuant to the Agreement and Plan of Merger, dated April 28, 2016, (as amended or supplemented from time to time, the “Merger Agreement”), by and among Cousins, Parkway Properties, Inc. ("Parkway"), and subsidiaries of Cousins and Parkway, Parkway merged with and into a wholly-owned subsidiary of the Company (the "Merger"), with this subsidiary continuing as the surviving corporation of the Merger. In accordance with the terms and conditions of the Merger

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Agreement, each outstanding share of Parkway common stock and each outstanding share of Parkway limited voting stock was converted into 1.63 shares of Cousins common stock or limited voting preferred stock, respectively.

On October 7, 2016, pursuant to the Merger Agreement and the Separation, Distribution and Transition Services Agreement, dated as of October 5, 2016 (the "Separation Agreement"), by and among Cousins, Parkway, Parkway, Inc. ("New Parkway"), and certain other parties thereto, Cousins distributed pro rata to its common and limited voting preferred stockholders, including legacy Parkway common and limited voting stockholders, all of the outstanding shares of common and limited voting stock, respectively, of New Parkway, a newly-formed entity that contains the combined businesses relating to the ownership of real properties in Houston, Texas and certain other businesses of Parkway (the "Spin-Off"). In the Spin-Off, Cousins distributed one share of New Parkway common or limited voting stock for every eight shares of common or limited voting preferred stock of Cousins held of record as of the close of business on October 6, 2016. New Parkway is now an independent public company, and its common stock is listed under the symbol "PKY" on the New York Stock Exchange.

As a result of the Spin-Off, the historical results of operations of the Company's properties that were contributed to New Parkway have been presented as discontinued operations in the consolidated statements of operations. The following table includes a summary of discontinued operations of the Company for the three and six months ended June 30, 2016 (in thousands):

Three Months Ended June 30, 2016 Six Months Ended June 30, 2016

Rental property revenues $ 44,281
$ 87,404
Rental property operating expenses (19,155 ) (36,960 )
Other revenues 102
288
Interest expense (1,965 ) (3,940 )
Depreciation and amortization (15,740 ) (31,168 )
Income from discontinued operations $ 7,523
$ 15,624

Cash provided by operating activities $ 23,253
$ 17,012
Cash used in investing activities $ (9,375 ) $ (18,112 )

4. INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

The Company describes its investments in unconsolidated joint ventures in note 6 of notes to consolidated financial statements in its Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2017. The following ~~table~~information summarizes ~~balance sheet~~financial data and principal activities of the Company's unconsolidated joint ~~ventures~~ventures. The information included in the following table entitled summary of financial position is as of ~~June 30, 2017~~March 31, 2018 and December 31, ~~2016~~2017. The information included in the summary of operations table is for the three months ended March 31, 2018 and 2017 (in thousands):.

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	Total Assets				Total Debt				Total Equity						Company’s Investment								Total Assets				Total Debt				Total Equity						Company’s Investment
SUMMARY OF FINANCIAL POSITION:	2017		2016		2017		2016		2017			2016			2017				2016				2018		2017		2018		2017		2018			2017			2018					2017
Terminus Office Holdings	$	267,747	$	268,242	$	205,454	$	207,545	$	51,112		$	49,476		$	25,384			$	25,686			$	259,812	$	261,999	$	202,051	$	203,131	$	46,632		$	48,033		$	46,583				$	24,898
DC Charlotte Plaza LLLP																							65,588		53,791		—		—		55,121			42,853			28,544					22,293
Carolina Square Holdings LP																							107,975		106,580		70,426		64,412		33,850			33,648			19,235					19,384
Charlotte Gateway Village, LLC																							127,198		124,691		—		—		123,674			121,386			15,459					14,568
Austin 300 Colorado Project, LP																							32,896		—		—		—		32,846			—			14,606					—
HICO Victory Center LP																							14,500		14,403		—		—		14,497			14,401			9,803					9,752
HICO Avalon II, LLC																							6,570		6,379		—		—		6,540			6,303			5,104					4,931
CL Realty, L.L.C.																							8,114		8,287		—		—		8,056			8,127			2,953					2,980
AMCO 120 WT Holdings, LLC																							20,879		18,066		—		—		18,972			16,354			2,239					1,664
Temco Associates, LLC																							4,470		4,441		—		—		4,367			4,337			886					875
EP II LLC																							270		277		—		—		175			180			40					44
EP I LLC	1,760		78,537		—		58,029		1,333			18,962			783				18,551				498		521		—		—		303			319			13					25
EP II LLC	520		67,754		—		44,969		239			21,743			88				17,606
Charlotte Gateway Village, LLC	125,819		119,054		—		—		121,544			116,809			14,163				11,796
HICO Victory Center LP	14,145		14,124		—		—		14,141			13,869			9,632				9,506
Carolina Square Holdings LP	88,571		66,922		50,529		23,741		34,087			34,173			18,752				18,325
CL Realty, L.L.C.	7,989		8,047		—		—		7,915			7,899			2,874				3,644
DC Charlotte Plaza LLLP	30,780		17,940		—		—		24,209			17,073			12,528				8,937
Temco Associates, LLC	4,398		4,368		—		—		4,294			4,253			854				829
Wildwood Associates	16,380		16,351		—		—		16,262			16,314			(1,169		)	(1)	(1,143		)	(1)	14,884		16,337		—		—		14,828			16,297			(1,077		)	(1	)	(1,151		)	(1	)
Crawford Long - CPI, LLC	28,400		27,523		72,070		72,822		(45,106		)	(45,928		)	(21,455		)	(1)	(21,866		)	(1)	27,239		27,362		70,672		71,047		(44,982		)	(44,815		)	(21,427		)	(1	)	(21,323		)	(1	)
111 West Rio Building	—		59,399		—		12,852		—			32,855			—				52,206
Courvoisier Centre JV, LLC	181,633		172,197		106,500		106,500		68,400			69,479			11,588				11,782
HICO Avalon II, LLC	5,237		—		—		—		5,237			—			3,928				—
AMCO 120 WT Holdings, LLC	11,591		10,446		—		—		11,127			9,136			617				184
Other	—		—		—		—		—			—			341				345
	$	784,970	$	930,904	$	434,553	$	526,458	$	314,794		$	366,113		$	78,908			$	156,388			$	690,893	$	643,134	$	343,149	$	338,590	$	314,879		$	267,423		$	122,961				$	78,940



	Total Revenues				Net Income (Loss)						Company's Share of Income (Loss)
SUMMARY OF OPERATIONS:	2018		2017		2018			2017			2018			2017
Charlotte Gateway Village, LLC	$	6,772	$	6,719	$	2,793		$	2,365		$	1,397		$	1,182
Terminus Office Holdings	10,922		10,946		1,599			1,635			830			818
Crawford Long - CPI, LLC	3,126		3,019		823			769			391			384
Wildwood Associates	—		—		(1,000		)	(29		)	317			(14		)
Courvoisier Centre JV, LLC	—		2,636		—			(388		)	63			(96		)
HICO Victory Center LP	96		85		96			85			50			54
Austin 300 Colorado Project, LP	150		—		99			—			49			—
Temco Associates, LLC	48		48		22			27			11			17
HICO Avalon II, LLC	—		—		(5		)	—			(4		)	—
EP II LLC	—		1,910		(5		)	137			(4		)	99
EP I LLC	4		3,065		(16		)	544			(12		)	282
CL Realty, L.L.C.	—		2,599		(44		)	2,463			(28		)	435
Carolina Square Holdings LP	2,614		24		202			(45		)	(175		)	—
DC Charlotte Plaza LLLP	—		1		—			1			—			1
111 West Rio Building	—		—		—			—			—			(2,581		)
AMCO 120 WT Holdings, LLC	—		—		(7		)	(7		)	—			—
	$	23,732	$	31,052	$	4,557		$	7,557		$	2,885		$	581

(1) Negative balances are included in deferred income on the balance sheets.

~~The following table summarizes statement of operations information of the Company's unconsolidated joint ventures for the~~ ~~six~~ ~~months ended~~ ~~June 30, 2017~~ ~~and~~ ~~2016~~ ~~(in thousands):~~

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Total Revenues Net Income (Loss) Company's Share of Income (Loss)
SUMMARY OF OPERATIONS: 2017 2016 2017 2016 2017 2016
Terminus Office Holdings $ 21,908
$ 20,978
$ 3,178
$ 2,597
$ 1,769
$ 1,298

EP I LLC 4,103
5,991
44,929
1,168
28,525
951

EP II LLC 2,643
2,044
12,967
(1,018 ) 9,725
(823 )
Charlotte Gateway Village, LLC 13,380
17,477
4,734
7,263
2,367
987

HICO Victory Center LP 171
169
171
162
114
81

Carolina Square Holdings LP 40
—
(94 ) —
—
—

CL Realty, L.L.C. 2,599
246
2,415
64
430
44

DC Charlotte Plaza LLLP 2
—
2
33
2
18

Temco Associates, LLC 80
147
41
79
25
119

Wildwood Associates —
—
(51 ) (56 ) (26 ) (28 )
Crawford Long - CPI, LLC 6,033
6,028
1,516
1,346
758
673

111 West Rio Building —
—
—
—
(2,593 ) —

Courvoisier Centre JV, LLC 6,554
—
(1,083 ) —
(195 ) —

HICO Avalon II, LLC —
—
—
—
—
—

AMCO 120 WT Holdings, LLC —
—
(12 ) —
—
—

Other —
—
—
—
—
298

$ 57,513
$ 53,080
$ 68,713
$ 11,638
$ 40,901
$ 3,618

On May 3, 2017, EP I, LLC and EP II, LLC sold the properties that they owned for a combined gross sales price of $199.0 million. After repayment of debt, the Company received a distribution of $70.0 million and recognized a gain of $37.9 million which is recorded in income from unconsolidated joint ventures.

In ~~June 2017, HICO Avalon II, LLC ("Avalon II"),~~2018, Austin 300 Colorado Project, LP, a joint venture between the Company, 3C Block 28 Partners, LP ("3CB"), and ~~Hines Avalon II Investor, LLC~~3C RR Xylem, LP ("~~Hines II"~~3CRR") was formed for the purpose of ~~acquiring and potentially~~ developing ana 309,000 square foot office building in ~~Alpharetta, Georgia. Pursuant to~~Austin, Texas. The Company owns a 50% interest in the ~~joint~~ venture, ~~agreement, all predevelopment expenditures are funded 75% by Cousins~~3CB owns a 34.5% interest, and ~~25% by Hines II. As of June 30, 2017, the~~3CRR owns a 15.5% interest. The Company has accounted for its investment in ~~Avalon II~~300 Colorado using the equity method as the Company does not ~~currently~~ control the activities of the venture. ~~If Avalon II commences construction, subsequent~~Upon formation, 3CB and 3CRR contributed land for use by the joint venture in the development ~~expenditures will be funded 90% by Cousins and 10% by Hines II. Additionally, Cousins will have control over the operational aspects of the venture and~~project, the Company ~~expects to consolidate the venture at that time.~~made an initial contribution of $6.0 million in cash, and 300 Colorado assumed a ground lease for an additional parcel of land.

5.~~INTANGIBLE ASSETS~~

~~Intangible assets on the balance sheets as of~~ ~~June 30, 2017~~ ~~and December 31, 2016 included the following (in thousands):~~

June 30, 2017 December 31, 2016
In-place leases, net of accumulated amortization of $74,308 and $46,899 in 2017 and 2016, respectively $ 170,234
$ 185,251
Above-market tenant leases, net of accumulated amortization of $10,826 and $6,515 in 2017 and 2016, respectively 35,746
40,260
Below-market ground lease, net of accumulated amortization of $207 and $69 in 2017 and 2016, respectively 18,206
18,344
Goodwill 1,674
1,674
$ 225,860
$ 245,529

~~The following is a summary of goodwill activity for the~~ ~~six~~ ~~months ended~~ ~~June 30, 2017~~ ~~and~~ ~~2016~~ ~~(in thousands):~~

Six Months Ended June 30,
2017 2016
Beginning balance $ 1,674
$ 3,647
Allocated to property sales —
(21 )
Ending balance $ 1,674
$ 3,626

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6.3.INTANGIBLE ASSETS

Intangible assets on the balance sheets as of March 31, 2018 and December 31, 2017 were as follows (in thousands):



	March 31, 2018		December 31, 2017
In-place leases, net of accumulated amortization of $100,818 and $91,548 at March 31, 2018 and December 31, 2017, respectively	$	130,277	$	139,548
Above-market tenant leases, net of accumulated amortization of $14,746 and $13,038 at March 31, 2018 and December 31, 2017, respectively	25,209		26,917
Below-market ground lease, net of accumulated amortization of $414 and $345 at March 31, 2018 and December 31, 2017, respectively	17,999		18,067
Goodwill	1,674		1,674
	$	175,159	$	186,206

Goodwill did not change for the three months ended March 31, 2018 and 2017.

4. OTHER ASSETS

Other assets on the balance sheets as of ~~June 30, 2017~~March 31, 2018 and December 31, ~~2016~~2017 included the following (in thousands):

June 30, 2017 December 31, 2016
Furniture, fixtures and equipment, leasehold improvements, and other deferred costs, net of accumulated depreciation of $23,206 and $23,135 in 2017 and 2016, respectively $ 14,265
$ 15,773
Lease inducements, net of accumulated amortization of $825 and $1,278 in 2017 and 2016, respectively 1,864
2,517
Prepaid expenses and other assets 11,291
8,432
Line of credit deferred financing costs, net of accumulated amortization of $2,691 and $2,264 in 2017 and 2016, respectively 1,780
2,182
Predevelopment costs and earnest money 80
179
$ 29,280
$ 29,083



	March 31, 2018		December 31, 2017
Furniture, fixtures and equipment, leasehold improvements, and other deferred costs, net of accumulated depreciation of $22,721 and $21,925 at March 31, 2018 and December 31, 2017, respectively	$	12,915	$	12,241
Prepaid expenses and other assets	8,343		3,902
Line of credit deferred financing costs, net of accumulated amortization of $361 and $3,119 at March 31, 2018 and December 31, 2017, respectively	6,866		1,213
Lease inducements, net of accumulated amortization of $1,077 and $978 at March 31, 2018 and December 31, 2017, respectively	3,270		3,126
Predevelopment costs and earnest money	490		372
	$	31,884	$	20,854

7.5. NOTES PAYABLE

The following table details the terms and amounts of the Company’s outstanding notes payable at ~~June 30, 2017~~March 31, 2018 and December 31, ~~2016~~2017 ($ in thousands):


Description	Interest Rate		Maturity	June 30, 2017			December 31, 2016			Interest Rate		Maturity*	March 31, 2018				December 31, 2017
Term Loan, unsecured	2.42	%	2021	$	250,000		$	250,000
Term Loan, Unsecured										3.08	%	2021	$	250,000			$	250,000
Senior Notes, Unsecured										3.91	%	2025	250,000				250,000
Fifth Third Center	3.37	%	2026	148,049			149,516			3.37	%	2026	145,801				146,557
Colorado Tower	3.45	%	2026	120,000			120,000			3.45	%	2026	120,000				120,000
Promenade	4.27	%	2022	103,864			105,342			4.27	%	2022	101,588				102,355
Senior Note, unsecured	4.09	%	2027	100,000			—
Credit Facility, unsecured	2.32	%	2019	94,000			134,000
Senior Notes, Unsecured										4.09	%	2027	100,000				100,000
816 Congress	3.75	%	2024	84,095			84,872			3.75	%	2024	82,903				83,304
3344 Peachtree	4.75	%	2017	77,928			78,971
Meridian Mark Plaza	6.00	%	2020	24,284			24,522			6.00	%	2020	23,912				24,038
The Pointe	4.01	%	2019	22,730			22,945			4.01	%	2019	22,398				22,510
One Eleven Congress	6.08	%	2017	—			128,000
The ACS Center	6.45	%	2017	—			127,508
San Jacinto Center	6.05	%	2017	—			101,000
Two Buckhead Plaza	6.43	%	2017	—			52,000
Credit Facility, Unsecured										2.93	%	2023	—				—
				1,024,950			1,378,676						1,096,602			—	1,098,764
Unamortized premium, net				750			6,792						169				219
Unamortized loan costs				(6,081		)	(4,548		)				(5,513		)		(5,755		)
Total Notes Payable				$	1,019,619		$	1,380,920					$	1,091,258			$	1,093,228

*Weighted average maturity of notes payable outstanding at March 31, 2018 was 6.4 years.

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Credit Facility

The Company ~~has~~had a $500 million senior unsecured line of credit (the "Credit Facility") that ~~matures~~was scheduled to mature on May 28, 2019. The Credit Facility ~~may be expanded to $750 million at the election of the Company, subject to the receipt of additional commitments from the lenders and other customary conditions.~~

~~The Credit Facility contains~~contained financial covenants that ~~require,~~required, among other things, the maintenance of an unencumbered interest coverage ratio of at least 2.00; a fixed charge coverage ratio of at least 1.50; an overall leverage ratio of no more than 60%; and a minimum shareholders' equity balance in an amount equal to $1.0 billion, plus a portion of the net cash proceeds from certain equity issuances. The Credit Facility also ~~contains~~contained customary representations and warranties and affirmative and negative covenants, as well as customary events of default. ~~The amounts outstanding under the Credit Facility may be accelerated upon the occurrence of any events of default.~~

The interest rate applicable to the Credit Facility ~~varies~~varied according to the Company’s leverage ratio, and ~~may,~~was, at the election of the Company, be determined based on either (1) the current London Interbank Offered Rate ("LIBOR") plus a spread of between 1.10% and 1.45%, based on leverage, or (2) the greater of Bank of America's prime rate, the federal funds rate plus 0.50%, or the

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one-month LIBOR plus 1.0% (the “Base Rate”), plus a spread of between 0.10% and 0.45%, based on leverage. The Company also ~~pays~~paid an annual facility fee on the total commitments under the Credit Facility of between 0.15% and 0.30%, based on leverage.

On January 3, 2018, the Company entered into a Fourth Amended and Restated Credit Agreement (the "New Credit Facility") under which the Company may borrow up to $1 billion if certain conditions are satisfied.

The New Credit Facility recasts the Credit Facility by:

Increasing the size from $500 million to $1 billion;

Extending the maturity date from May 28, 2019 to January 3, 2023;

Reducing certain per annum variable interest rate spreads and other fees;

Providing for the expansion of the New Credit Facility by an additional $500 million, subject to receipt of additional commitments from lenders and other customary conditions;

Decreasing the minimum spread over LIBOR from 1.10% to 1.05%;

Removing the $90 million investment entity cap;

Removing the Unsecured Debt Limit and replacing it with an Unsecured Leverage Ratio limit;

Removing the Minimum Shareholder's Equity requirement;

Decreasing the Consolidated Unencumbered Interest Coverage ratio from 2.0 to 1.75; and

Removing the Consolidated Secured Recourse Debt Limitation and replacing it with a Secured Leverage Ratio of 40% or less.

The New Credit Facility did not change the other financial covenants from those of the Credit Facility.

The interest rate applicable to the New Credit Facility varies according to the Company's leverage ratio, and may, at the election of the Company, be determined based on either (1) the current LIBOR plus the applicable spread detailed below, or (2) the greater of Bank of America's prime rate, the federal funds rate plus 0.50%, or the one-month LIBOR plus 1.0% (the "Base Rate"), plus the applicable spread detailed below. Fees on letters of credit issued under the New Credit Facility are payable at an annual rate equal to the spread applicable to loans bearing interest based on LIBOR. The Company also pays an annual facility fee on the total commitments under the New Credit Facility. The pricing spreads and the facility fee under the New Credit Facility are as follows:



Leverage Ratio	Applicable % Spread for LIBOR Loans	Applicable % Spread for Base Rate Loans	Annual Facility Fee %
≤ 35%	1.05%	0.10%	0.15%
> 35% but ≤ 40%	1.10%	0.15%	0.20%
> 40% but ≤ 45%	1.20%	0.20%	0.20%
> 45% but ≤ 50%	1.20%	0.20%	0.25%
> 50%	1.45%	0.45%	0.30%

The New Credit Facility also provides for alternative pricing spreads and facility fees, which would be available to the Company on any date after it obtains an investment grade credit rating.

At ~~June 30, 2017,~~March 31, 2018, the New Credit Facility's spread over LIBOR was ~~1.1%~~1.05%. The amount that the Company ~~may draw~~had available to be drawn under the New Credit Facility iswas a defined calculation based on the Company's unencumbered assets and other factors. ~~The total available borrowing capacity~~As of March 31, 2018, the Company had no amounts drawn under the New Credit Facility ~~was $405~~and had the ability to borrow $997 million ~~at June 30, 2017.~~of the $1 billion available with $3 million utilized by outstanding letters of credit.

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Unsecured Term Loan

The Company has a $250 million ~~senior~~ unsecured term loan (the "Term Loan") that matures on December 2, 2021. ~~The~~Through January 21, 2018, the Term Loan ~~contains~~contained financial covenants substantially consistent with those of the Credit Facility. On January 22, 2018, the Term Loan was amended to make the financial covenants consistent with those of the New Credit Facility. The interest rate applicable to the Term Loan varies according to the Company’s leverage ratio, and may, at the election of the Company, be determined based on either (1) the current London Interbank Offered Rate ("LIBOR") plus a spread of between 1.20% and 1.70%, based on leverage, or (2) the greater of Bank of America's prime rate, the federal funds rate plus 0.50%, or the one-month LIBOR plus 1.0% (the “Base Rate”), plus a spread of between 0.00% and 0.75%, based on leverage. At ~~June 30, 2017,~~March 31, 2018, the Term Loan's spread over LIBOR was 1.2%.

Unsecured Senior Notes

In ~~April~~ 2017, the Company closed a $350 million private placement of senior unsecured notes, which ~~were issued~~was funded in two tranches. The first tranche of $100 million ~~was issued in April 2017,~~ has a 10-year maturity and ~~has~~ a fixed annual interest rate of 4.09%. The second tranche of $250 million ~~was issued in July 2017,~~ has an 8-year maturity and ~~has~~ a fixed annual interest rate of 3.91%.

The senior unsecured notes contain financial covenants that require, among other things, the maintenance of an unencumbered interest coverage ratio of at least ~~2.00;~~1.75; a fixed charge coverage ratio of at least 1.50; an overall leverage ratio of no more than 60%; and ~~a minimum shareholders' equity in an amount equal to $1.9 billion, plus a portion~~secured leverage ratio of ~~the net cash proceeds from certain equity issuances.~~40% or less. The senior notes also contain customary representations and warranties and affirmative and negative covenants, as well as customary events of default. ~~The amounts outstanding under the senior notes may be accelerated upon the occurrence of any events of default.~~

Fair Value

At ~~June 30, 2017~~March 31, 2018 and December 31, ~~2016,~~2017, the aggregate estimated fair values of the Company's notes payable were ~~$1.0~~$1.1 billion ~~and $1.4 billion, respectively,~~for each of the periods, calculated by discounting the debt's remaining contractual cash flows at estimated rates at which similar loans could have been obtained at those respective dates. The estimate of the current market rate, which is the most significant input in the discounted cash flow calculation, is intended to replicate debt of similar maturity and loan-to-value relationship. These fair value calculations are considered to be Level 2 under the guidelines as set forth in ASC 820, "Fair Value Measurement," as the Company utilizes market rates for similar type loans from third-party brokers.

Other Information

For the three ~~and six~~ months ended ~~June 30,~~March 31, 2018 and 2017, ~~and~~ ~~2016~~, interest expense was as follows (in thousands):


	Three Months Ended June 30, 2017						Six Months Ended June 30,						Three Months Ended March 31,
	2017			2016			2017			2016			2018			2017
Total interest incurred	$	10,741		$	8,350		$	22,072		$	16,506		$	10,874		$	11,331
Less interest - discontinued operations	—			(1,965		)	—			(3,940		)
Interest capitalized	(2,218		)	(1,016		)	(3,808		)	(1,758		)	(1,096		)	(1,590		)
Total interest expense	$	8,523		$	5,369		$	18,264		$	10,808		$	9,778		$	9,741

In April 2017, the Company repaid in full, without penalty, the $128.0 million One Eleven Congress mortgage note and the $101.0 million San Jacinto Center mortgage note. In May 2017, the Company repaid in full, without penalty, the $52.0 million Two Buckhead Plaza mortgage note. In connection with these repayments, the Company recorded gains on extinguishment of debt of $2.2 million which represented the unamortized premium recorded on the notes at the time of the Merger.

In June 2017, The Company sold the ACS Center. A portion of the proceeds from the sale were used to repay the $127.0 million mortgage note on the associated property, and the Company recorded a loss on extinguishment of debt of $376,000 which represented the remaining unamortized loan costs and other costs associated with repaying the debt.

Subsequent to quarter end, in July 2017, the Company repaid in full, without penalty, the $77.9 million 3344 Peachtree mortgage note. In connection with the repayment, the Company expects to record a gain on extinguishment of debt of $429,000 which represents the unamortized premium recorded on the note at the time of the Merger.

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8.6. COMMITMENTS AND CONTINGENCIES

Commitments

At ~~June 30, 2017~~,March 31, 2018, the Company had outstanding letters of credit and performance bonds totaling ~~$3.9~~$3.7 million. As a lessor, the Company had ~~$180.9~~$58.4 million in future obligations under leases to fund tenant improvements and other future construction obligations at ~~June 30, 2017~~.March 31, 2018. As a lessee, the Company had future obligations under ground and other operating leases of ~~$210.1~~$207.6 million at ~~June 30, 2017~~.March 31, 2018.

Litigation

The Company is subject to various legal proceedings, claims, and administrative proceedings arising in the ordinary course of business, some of which are expected to be covered by liability insurance. Management makes assumptions and estimates concerning the likelihood and amount of any potential loss relating to these matters using the latest information available. The Company records a liability for litigation if an unfavorable outcome is probable and the amount of loss or range of loss can be reasonably estimated. If an unfavorable outcome is probable and a reasonable estimate of the loss is a range, the Company accrues the best estimate within the range. If no amount within the range is a better estimate than any other amount, the Company accrues the minimum amount within the range. If an unfavorable outcome is probable but the amount of the loss cannot be reasonably

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estimated, the Company discloses the nature of the litigation and indicates that an estimate of the loss or range of loss cannot be made. If an unfavorable outcome is reasonably possible and the estimated loss is material, the Company discloses the nature and estimate of the possible loss of the litigation. The Company does not disclose information with respect to litigation where an unfavorable outcome is considered to be remote or where the estimated loss would not be material. Based on current expectations, such matters, both individually and in the aggregate, are not expected to have a material adverse effect on the liquidity, results of operations, business, or financial condition of the Company.

9.7. STOCKHOLDERS' EQUITY

On ~~June~~March 19, ~~2017,~~2018, the Company declared a cash dividend of ~~$0.06~~$0.065 per common share, which was paid ~~July~~on April 13, ~~2017~~2018 to shareholders of record on ~~July~~April 3, ~~2017.~~2018.

In May 2017, certain holders of CPLP units redeemed 951,818 units in exchange for shares of the Company's common stock. The aggregate value at the time of these transactions was $8.1 million based upon the value of the Company's common stock at the time of the transactions.

In 2015, the Board of Directors of the Company authorized the repurchase of up to $100 million of its outstanding common shares. The plan expires on September 8, 2017. The repurchases may be executed in the open market, through private negotiations, or in other transactions permitted under applicable law. The timing, manner, price and amount of any repurchases will be determined by the Company in its discretion and will be subject to economic and market conditions, stock price, applicable legal requirements and other factors. The share repurchase program may be suspended or discontinued at any time. No shares were repurchased during the six months ended June 30, 2017.

~~10.~~8. STOCK-BASED COMPENSATION

The Company has several types of stock-based compensation - stock options, restricted stock, and restricted stock units (“RSUs”) - which are described in note 13 of notes to consolidated financial statements in the Company's Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2017. The expense related to a portion of the stock-based compensation awards is fixed. The expense related to other stock-based compensation awards fluctuates from period to period dependent, in part, on the Company's stock price and stock performance relative to its peers. The Company recorded stock-based compensation expense, net of forfeitures, of ~~$2.9~~$2.6 million and ~~$340,000~~$1.7 million for the three months ended ~~June 30, 2017~~March 31, 2018 and ~~2016, respectively, and $4.6 million and $4.6 million for the six months ended June 30, 2017 and 2016, respectively.~~2017.

The Company maintains the 2009 Incentive Stock Plan (the "2009 Plan") and the 2005 Restricted Stock Unit Plan (the “RSU Plan”). Under the 2009 Plan, during the quarter ended March 31, 2018, the Company made restricted stock grants ~~in 2017~~ of ~~308,289~~315,199 shares to key employees, which vest ratably over a three-year period. Under the RSU Plan, during the quarter ended March 31, 2018, the Company awarded two types of performance-based RSUs ~~in 2017~~ to key employees based on the following metrics: (1) Total Stockholder Return of the Company, as defined in the RSU Plan, as compared to the companies in the SNL US REIT Office index (“TSR RSUs”), and (2) the ratio of cumulative funds from operations per share to targeted cumulative funds from operations per share (“FFO RSUs”) as defined in the RSU Plan. The performance period for both awards is January 1, ~~2017~~2018 to December 31, ~~2019,~~2020, and the targeted units awarded of TSR RSUs and FFO RSUs was ~~267,013~~315,124 and ~~132,266,~~135,054, respectively. The ultimate payout of these awards can range from 0% to 200% of the targeted number of units depending on the achievement of the market and performance metrics described above. These RSU awards cliff vest on

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December 31, ~~2019~~2020 and are to be settled in cash with payment dependent on upon attainment of required service, market, and performance criteria. The number of RSUs vesting will be determined by the Compensation Committee, and the payout per unit will be equal to the average closing price on each trading day during the 30-day period ending on December 31, ~~2019.~~2020. The Company expenses an estimate of the fair value of the TSR RSUs over the performance period using a quarterly Monte Carlo valuation. The FFO RSUs are expensed over the vesting period using the fair market value of the Company's stock at the reporting date multiplied by the anticipated number of units to be paid based on the current estimate of what the ratio is expected to be upon vesting. Dividend equivalents on the TSR RSUs and the FFO RSUs will also be paid based upon the percentage vested.

In addition, the Company granted 166,132 time-vested RSUs to key employees in 2017. The value of each unit is equal to the fair value of one share of common stock. The vesting period for this award is three years. These RSUs are to be settled in cash with payment dependent upon the attainment of the required service criteria. Dividend equivalents will be paid upon vesting based on the number of RSUs granted with such payments made concurrently with payment of common dividends.

During the three months ended June 30, 2017, the Company issued 120,878 shares of common stock at fair value to members of its board of directors in lieu of fees, and recorded $1.0 million in general and administrative expense in the three months ended June 30, 2017 related to the issuances.

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~~11.~~9. EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share for the three ~~and six~~ months ended March 31, 2018 and 2017 (in thousands except per share amounts):



	Three Months Ended March 31,
	2018			2017
Earnings per common share - basic:
Numerator:
Income from continuing operations	$	16,406		$	4,858
Net income attributable to noncontrolling interests in CPLP from continuing operations	(287		)	(101		)
Net income attributable to other noncontrolling interests	(76		)	(6		)
Net income available for common stockholders	$	16,043		$	4,751

Denominator:
Weighted average common shares - basic	420,154			402,781
Earnings per common share - basic	$	0.04		$	0.01
Earnings per common share - diluted:
Numerator:
Income from continuing operations	$	16,406		$	4,858
Net income attributable to other noncontrolling interests from continuing operations	(76		)	(6		)
Net income available for common stockholders before net income attributable to noncontrolling interests in CPLP	$	16,330		$	4,852

Denominator:
Weighted average common shares - basic	420,154			402,781
Add:
Potential dilutive common shares - stock options	567			292
Weighted average units of CPLP convertible into common shares	6,974			8,113
Weighted average common shares - diluted	427,695			411,186

Earnings per common share - diluted	$	0.04		$	0.01

Weighted average anti-dilutive stock options outstanding	24			1,499

10. ~~June 30,~~CONSOLIDATED STATEMENTS OF CASH FLOWS - SUPPLEMENTAL INFORMATION

Supplemental information related to cash flows, including significant non-cash activity affecting the consolidated statements of cash flows, for the three months ended March 31, 2018 and 2017 ~~and~~ ~~2016~~ is as follows (in thousands):



		March 31, 2018		March 31, 2017
Interest paid, net of amounts capitalized		$	13,775	$	13,582
Income taxes paid		—		—
Non-Cash Transactions:
	Transfer from projects under development to operating properties	212,628		—
	Change in accrued property acquisition, development, and tenant expenditures	28,465		411
	Common stock dividends declared	27,315		25,135
	Cumulative effect of change in accounting principle	22,329		—
	Transfer from investment in unconsolidated joint ventures to operating properties	—		68,390
	Transfer from operating properties to real estate assets and other assets held for sale	—		44,653
	Transfer from operating properties to liabilities of real estate assets held for sale	—		(130,691		)

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Three Months Ended June 30, Six Months Ended June 30,
2017 2016 2017 2016
Earnings per Common Share - basic:
Numerator:
     Income from continuing operations $ 170,945
$ 242
$ 175,803
$ 14,937

Net income attributable to noncontrolling interests in CPLP
from continuing operations (2,856 ) —
(2,957 ) —

Net income attributable to other noncontrolling interests —
—
(6 ) —

Income from continuing operations available for common stockholders 168,089
242
172,840

14,937

Income from discontinued operations —
7,523
—
15,624

         Net income available for common stockholders $ 168,089
$ 7,765
$ 172,840
$ 30,561

Denominator:
Weighted average common shares - basic 419,402
210,129
411,137
210,516

Earnings per common share - basic:
Income from continuing operations available for common
    stockholders
$ 0.40
$ —
$ 0.42
$ 0.07

Income from discontinued operations available for common
    stockholders
—
0.04
—
0.08

Earnings per common share - basic $ 0.40
$ 0.04
$ 0.42
$ 0.15

Earnings per common share - diluted:
Numerator:
     Income from continuing operations $ 170,945
$ 242
$ 175,803

$ 14,937

Net income attributable to other noncontrolling interests
    from continuing operations
—
—
(6 ) —

Income from continuing operations available for common stockholders before net income attributable to noncontrolling interests in CPLP 170,945
242
175,797

14,937

Income from discontinued operations available for common stockholders —
7,523
—
15,624

Net income available for common stockholders before
     net income attributable to noncontrolling interests in
     CPLP
$ 170,945
$ 7,765
$ 175,797
$ 30,561

Denominator:
Weighted average common shares - basic 419,402
210,129
411,137
210,516

     Add:
Potential dilutive common shares - stock options 320
233
306
171

Weighted average units of CPLP convertible into
    common shares
7,458
—
7,784
—

Weighted average common shares - diluted 427,180
210,362
419,227
210,687

Earnings per common share - diluted:
Income from continuing operations available for common stockholders before net income attributable to noncontrolling interests in CPLP $ 0.40
$ —
$ 0.42
$ 0.07

Income from discontinued operations available for common
    stockholders
—
0.04
—
0.08

Earnings per common share - diluted $ 0.40
$ 0.04
$ 0.42

$ 0.15

Weighted average anti-dilutive stock options outstanding 731
1,129
744
1,131

The following table provides a reconciliation of cash, cash equivalents, and restricted cash recorded on the balance sheet to cash, cash equivalents, and restricted cash in the statements of cash flows (in thousands):

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	March 31,				December 31,
	2018		2017		2017		2016
Cash and cash equivalents	$	108,152	$	35,755	$	148,929	$	35,687
Restricted cash	1,185		13,485		56,816		15,634
Total cash, cash equivalents, and restricted cash	$	109,337	$	49,240	$	205,745	$	51,321

~~12.~~11. REPORTABLE SEGMENTS

The Company's segments are based on the Company's method of internal reporting which classifies operations by property type and geographical area. The segments by property type are: Office and Mixed-Use. The segments by geographical region are: Atlanta, Austin, Charlotte, ~~Orlando,~~ Phoenix, Tampa, Orlando, and Other. ~~Subsequent to the Merger completed in~~In the fourth quarter of ~~2016,~~2017, the Company ~~added~~sold its properties in the Orlando ~~Phoenix,~~market as part of its ongoing investment strategy of exiting non-core markets and ~~Tampa segments.~~recycling investment capital to fund investment activity. These reportable segments represent an aggregation of operating segments reported to the Chief Operating Decision Maker based on similar economic characteristics that include the type of property and the geographical location. Each segment includes both consolidated operations and the Company's share of unconsolidated joint venture operations.

Company management evaluates the performance of its reportable segments in part based on net operating income (“NOI”). NOI represents rental property revenues less rental property operating expenses. NOI is not a measure of cash flows or operating results as measured by GAAP, is not indicative of cash available to fund cash needs, and should not be considered an alternative to cash flows as a measure of liquidity. All companies may not calculate NOI in the same manner. The Company considers NOI to be an appropriate supplemental measure to net income as it helps both management and investors understand the core operations of the Company's operating assets. NOI excludes corporate general and administrative expenses, interest expense, depreciation and amortization, impairments, gains/loss on sales of real estate, and other non-operating items.

Segment net income, amount of capital expenditures, and total assets are not presented in the following tables because management does not utilize these measures when analyzing its segments or when making resource allocation decisions. Information on the Company's segments along with a reconciliation of NOI to net income ~~available to common stockholders~~ for the three ~~and six~~ months ended ~~June 30,~~March 31, 2018 and 2017 ~~and 2016~~ are as follows (in thousands):

Three Months Ended June 30, 2017 Office Mixed-Use Total
Net Operating Income:
Atlanta $ 29,218
$ 853
$ 30,071
Austin 14,852
—
14,852
Charlotte 15,202
—
15,202
Orlando 3,318
—
3,318
Tampa 7,451
—
7,451
Phoenix 8,838
—
8,838
Other 383
—
383
Total Net Operating Income $ 79,262
$ 853
$ 80,115


Three Months Ended June 30, 2016	Office			Mixed-Use		Total
Three Months Ended March 31, 2018									Office		Mixed-Use		Total
Net Operating Income:
Houston	$	25,125		$	—	$	25,125
Atlanta	21,572			1,742		23,314			$	32,165	$	—	$	32,165
Austin	5,763			—		5,763			14,941		—		14,941
Charlotte	4,819			—		4,819			15,842		—		15,842
Phoenix									8,974		—		8,974
Tampa									7,728		—		7,728
Other	(13		)	—		(13		)	440		488		928
Total Net Operating Income	$	57,266		$	1,742	$	59,008		$	80,090	$	488	$	80,578

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Six Months Ended June 30, 2017 Office Mixed-Use Total
Net Operating Income:
Atlanta $ 59,190
$ 3,126
$ 62,316
Austin 29,039
—
29,039
Charlotte 30,627
—
30,627
Orlando 7,108
—
7,108
Tampa 14,287
—
14,287
Phoenix 16,056
—
16,056
Other 848
—
848
Total Net Operating Income $ 157,155
$ 3,126
$ 160,281


Six Months Ended June 30, 2016	Office		Mixed-Use		Total
Three Months Ended March 31, 2017							Office		Mixed-Use		Total
Net Operating Income:
Houston	$	50,443	$	—	$	50,443
Atlanta	44,178		3,348		47,526		$	29,972	$	2,272	$	32,244
Charlotte							15,426		—		15,426
Austin	10,955		—		10,955		14,187		—		14,187
Charlotte	9,574		—		9,574
Phoenix							7,217		—		7,217
Tampa							6,837		—		6,837
Orlando							3,790		—		3,790
Other	23		—		23		466		—		466
Total Net Operating Income	$	115,173	$	3,348	$	118,521	$	77,895	$	2,272	$	80,167

The following reconciles Net Operating Income to Net Income for each of the periods presented (in thousands):


	Three Months Ended June 30,						Six Months Ended June 30,						Three Months Ended March 31,
	2017			2016			2017			2016			2018			2017
Net Operating Income	$	80,115		$	59,008		$	160,281		$	118,521		$	80,578		$	80,167
Net operating income from unconsolidated joint ventures	(7,609		)	(6,954		)	(16,783		)	(13,600		)	(7,421		)	(9,176		)
Net operating income from discontinued operations	—			(25,126		)	—			(50,444		)
Fee income	1,854			1,824			3,791			4,023			2,894			1,936
Other income	3,174			27			8,600			417			960			5,426
Reimbursed expenses	(907		)	(798		)	(1,772		)	(1,668		)	(942		)	(865		)
General and administrative expenses	(8,618		)	(4,691		)	(14,828		)	(12,934		)	(6,809		)	(6,182		)
Interest expense	(8,523		)	(5,369		)	(18,264		)	(10,808		)	(9,778		)	(9,741		)
Depreciation and amortization	(50,040		)	(16,641		)	(104,924		)	(33,182		)	(45,093		)	(54,884		)
Acquisition and transaction costs	(246		)	(2,424		)	(2,177		)	(2,443		)	(91		)	(1,930		)
Gain on extinguishment of debt	1,829			—			1,829			—
Loss on extinguishment of debt													(85		)	—
Other expenses	(236		)	(152		)	(612		)	(507		)	(320		)	(404		)
Income from unconsolidated joint ventures	40,320			1,784			40,901			3,618			2,885			581
Gain (loss) on sale of investment properties	119,832			(246		)	119,761			13,944
Income from discontinued operations	—			7,523			—			15,624
Loss on sale of investment properties													(372		)	(70		)
Net Income	$	170,945		$	7,765		$	175,803		$	30,561		$	16,406		$	4,858

Revenues by reportable segment, including a reconciliation to total rental property revenues on the condensed consolidated statements of operations, for three ~~and six~~ months ended ~~June 30,~~March 31, 2018 and 2017 ~~and 2016~~ are as follows (in thousands):



Three Months Ended March 31, 2018	Office			Mixed-Use			Total
Revenues:
Atlanta	$	49,466		$	—		$	49,466
Austin	26,576			—			26,576
Charlotte	23,041			—			23,041
Tampa	12,536			—			12,536
Phoenix	12,060			—			12,060
Other	524			795			1,319
Total segment revenues	124,203			795			124,998
Less: Company's share of rental property revenues from unconsolidated joint ventures	(10,855		)	(795		)	(11,650		)
Total rental property revenues	$	113,348		$	—		$	113,348

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Three Months Ended June 30, 2017 Office Mixed-Use Total
Revenues:
Atlanta $ 46,293
$ 1,358
$ 47,651
Austin 25,429
—
25,429
Charlotte 22,599
—
22,599
Orlando 6,331
—
6,331
Tampa 11,795
—
11,795
Phoenix 11,879
—
11,879
Other 758
—
758
Total segment revenues 125,084
1,358
126,442
Less Company's share of rental property revenues from unconsolidated joint ventures (11,077 ) (1,358 ) (12,435 )
Total rental property revenues $ 114,007
$ —
$ 114,007

Three Months Ended June 30, 2016 Office Mixed-Use Total
Revenues:
Houston $ 44,281
$ 44,281
Atlanta 36,779
3,026
39,805
Austin 10,417
—
10,417
Charlotte 6,388
—
6,388
Other 91
—
91
Total segment revenues 97,956
3,026
100,982
Less discontinued operations (44,281 ) —
(44,281 )
Less Company's share of rental property revenues from unconsolidated joint ventures (7,221 ) (3,026 ) (10,247 )
Total rental property revenues $ 46,454
$ —
$ 46,454

Six Months Ended June 30, 2017 Office Mixed-Use Total
Revenues
Atlanta $ 93,814
$ 5,049
$ 98,863
Austin 49,963
—
49,963
Charlotte 45,342
—
45,342
Orlando 12,972
—
12,972
Tampa 23,098
—
23,098
Phoenix 21,997
—
21,997
Other 1,575
—
1,575
Total segment revenues $ 248,761
$ 5,049
$ 253,810
Less Company's share of rental property revenues from unconsolidated joint ventures (22,237 ) (5,049 ) (27,286 )
Total rental property revenues $ 226,524
$ —
$ 226,524

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Six Months Ended June 30, 2016	Office			Mixed-Use			Total
Three Months Ended March 31, 2017										Office			Mixed-Use			Total
Revenues:
Houston	$	87,403		$	—		$	87,403
Atlanta	73,995			6,003			$	79,998		$	47,521		$	3,691		$	51,212
Austin	19,356			—			$	19,356		24,534			—			24,534
Charlotte	12,734			—			$	12,734		22,743			—			22,743
Tampa										11,303			—			11,303
Phoenix										10,117			—			10,117
Orlando										6,641			—			6,641
Other	231			—			$	231		817			—			817
Total segment revenues	193,719			6,003			199,722			123,676			3,691			127,367
Less discontinued operations	(87,403		)	—			(87,403		)
Less Company's share of rental property revenues from unconsolidated joint ventures	(14,509		)	(6,003		)	(20,512		)
Less: Company's share of rental property revenues from unconsolidated joint ventures										(11,159		)	(3,691		)	(14,850		)
Total rental property revenues	$	91,807		$	—		$	91,807		$	112,517		$	—		$	112,517

2017

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Overview:

Cousins Properties Incorporated ("Cousins") (and collectively, with its subsidiaries, the "Company," "we," "our," or "us") is a self-administered and self-managed real estate investment trust, or REIT. Our ~~core focus~~strategy is ~~on the acquisition, development, leasing, management, and~~to create value for our stockholders through ownership of ~~Class-A~~the premier urban office ~~and mixed-use properties~~portfolio in the Sunbelt markets, with a particular focus on ~~Arizona, Florida,~~ Georgia, Texas, North Carolina, Florida, and ~~Texas.~~Arizona. This strategy is based on a disciplined approach to capital allocation that includes value-add acquisitions, selective development projects, and timely dispositions of non-core assets. This strategy is also based on a simple, flexible, and low-leveraged balance sheet that allows us to pursue investment opportunities at the most advantages points in the cycle. To implement this strategy, we leverage our strong local operating platforms within each of our major markets. As of ~~June 30, 2017~~,March 31, 2018, our portfolio of real estate assets consisted of interests in 3129 operating properties (28 office ~~properties~~and one mixed-use) containing ~~15.5~~15.0 million square feet of space and ~~five~~four projects (three office and ~~two~~one mixed-use) under active development. We have a comprehensive strategy in place based on a simple platform, trophy assets, and opportunistic investments. This streamlined strategy enables us to maintain a targeted, asset-specific approach to investing where we seek to leverage our development skills, relationships, market knowledge, and operational expertise. We intend to generate returns and create value for stockholders through the continued lease-up of our portfolio, through the execution of our development pipeline, and through opportunistic investments in office and mixed-use projects within our core markets.

We leased or renewed ~~341,008~~329,583 square feet of office space during the ~~second~~first quarter of ~~2017.~~2018. The weighted average net effective rent of these leases, representing base rent less operating expense reimbursements and leasing costs, was ~~$21.16~~$27.95 per square foot. For those leases that were previously occupied within the past year, net effective rent increased ~~28.5%~~35.2%. Same property net operating income (defined below) for consolidated properties and our share of unconsolidated properties increased by ~~6.8%~~2.6% between the three months ended ~~June 30, 2017~~March 31, 2018 and ~~2016.~~2017.

Results of Operations

Our financial results have been significantly affected by the merger with Parkway Properties, Inc. ("the Merger") and the spin-off of the combined companies' Houston business to Parkway, Inc. (the "Spin-Off") in October 2016 (collectively, the "Parkway Transactions"). Accordingly, our historical financial statements may not be indicative of future operating results.

Net Operating Income

The following table summarizes rental property revenues, rental property operating expenses, and net operating income ("NOI") for each of the periods presented, including our same property portfolio. NOI represents rental property revenue less rental property operating expenses. Our same property portfolio is comprised of office properties that have been fully operational in each of the comparable reporting periods. A fully operational property is one that has achieved 90% economic occupancy or has been substantially complete and owned by us for each of the periods presented. Same property amounts for the ~~2017~~2018 versus ~~2016~~2017 comparison are from properties that have been owned since January 1, ~~2016~~2017 through the end of the current reporting period, excluding dispositions. This information is presented for consolidated properties only and does not include net operating income from our unconsolidated joint ventures.


	Three Months Ended June 30,								Six Months Ended June 30,								Three Months Ended March 31,
	2017		2016		$ Change		% Change		2017		2016		$ Change		% Change		2018		2017		$ Change			% Change
Rental Property Revenues
Same Property	$	35,535	$	33,373	$	2,162	6.5	%	$	71,228	$	67,203	$	4,025	6.0	%	$	103,990	$	99,653	$	4,337		4.4	%
Non-Same Property	78,472		13,081		65,391		499.9	%	155,296		24,604		130,692		531.2	%	9,358		12,864		(3,506		)	(27.3	)%
Total Rental Property Revenues	$	114,007	$	46,454	$	67,553	145.4	%	$	226,524	$	91,807	$	134,717	146.7	%	$	113,348	$	112,517	$	831		0.7	%

Rental Property Operating Expenses
Same Property	$	13,076	$	12,348	$	728	5.9	%	$	25,962	$	24,699	$	1,263	5.1	%	$	38,230	$	35,761	$	2,469		6.9	%
Non-Same Property	28,425		7,178		21,247		296.0	%	57,064		12,631		44,433		351.8	%	1,961		5,765		(3,804		)	(66.0	)%
Total Rental Property Operating Expenses	$	41,501	$	19,526	$	21,975	112.5	%	$	83,026	$	37,330	$	45,696	122.4	%	$	40,191	$	41,526	$	(1,335	)	(3.2	)%

Net Operating Income
Same Property NOI	$	22,459	$	21,025	$	1,434	6.8	%	$	45,266	$	42,504	$	2,762	6.5	%	$	65,760	$	63,892	$	1,868		2.9	%
Non-Same Property NOI	50,047		5,903		44,144		747.8	%	98,232		11,973		86,259		720.4	%	7,397		7,099		298			4.2	%
Total NOI	$	72,506	$	26,928	$	45,578	169.3	%	$	143,498	$	54,477	$	89,021	163.4	%	$	73,157	$	70,991	$	2,166		3.1	%

Same property NOI increased ~~$1.4~~$1.9 million ~~(6.8%) and $2.8 million (6.5%~~(2.9%) between the 2018 and 2017 three months ended and six months ended June 30, 2017 and 2016, respectively. The increases were primarily due to increased occupancy rates at Fifth Third Center and increased occupancy rates and increased revenue from expansion space at Promenade.month periods. The increase in same property ~~operating~~revenues and expenses is primarily due to a 41% increase in weighted average occupancy at Research Park V and an 11% increase in weighted average occupancy at Corporate Center. Non-same property revenues and expenses decreased by $3.5 million and $3.8 million, respectively, between the 2018 and 2017 three month periods. The decreases were primarily due to the sale of ACS Center in the second quarter of 2017 and the sales of Bank of America Center, One Orlando Centre, and Citrus Center in December 2017, partially offset by the commencement of operations of 8000 Avalon in June 2017 and 864 Spring Street in January 2018.

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expenses was primarily due to an increase in repair and maintenance, bad debt, and parking between the periods. Non-same property revenues and expenses increased between the three and six month periods primarily due to the Merger.

Other Income

Other income ~~increased $3.1~~decreased $4.5 million (82%) between the 2018 and 2017 three month ~~periods and increased $8.2 million between the six month periods.This increase~~periods. This decrease is primarily driven by 2017 lease termination fees at ~~Fifth Third Center, Nascar Plaza,~~ Hayden Ferry and ~~Northpark Town Center.~~Northpark.

General and Administrative Expenses

General and administrative expenses increased ~~$3.9 million (84%~~$627,000 (10%) between the 2018 and 2017 three month ~~periods, and increased $1.9 million (15%) between the six month~~ periods. ~~These increases are~~This increase is primarily driven by long-term compensation expense increases as a result of fluctuations in our common stock price relative to our office peers included in the SNL US Office REIT Index.

~~Interest Expense~~

Interest expense, net of amounts capitalized, increased $3.2 million (59%) between the three month periods, and increased $7.5 million (69%) between the six month periods primarily driven by the additional interest expense related to mortgage loans assumed in the Merger and the $250 million Term Loan that closed in the fourth quarter of 2016.

Depreciation and Amortization

Depreciation and amortization ~~increased $33.4~~decreased $9.8 million ~~(201%~~(18%) between the 2018 and 2017 three month periods primarily due to the sale of ACS Center in June 2017 and ~~increased $71.7 million (216%) between~~ the ~~six month periods. Amounts~~sales of Bank of America Center, One Orlando Centre, and Citrus Center in ~~all periods represent costs associated with~~December 2017, partially offset by the ~~Merger. The Company does not believe it will incur significant additional Merger costs.~~commencement of operations at 8000 Avalon in June 2017 and 864 Spring Street in January 2018.

Acquisition and Transaction Costs

Acquisition and ~~merger~~transaction costs decreased ~~$2.2~~$1.8 million ~~(90%~~(95%) in the 2018 and 2017 three month ~~periods,~~periods. These costs include legal, accounting, and ~~decreased $266,000 (11%) between~~financial advisory fees as well as the ~~six month periods;~~cost of due diligence work and the ~~Company believes it has paid significantly all~~costs of combining operations of Parkway Properties, Inc. with the Company. We do not expect to incur any material additional expenses related to our transactions with Parkway ~~Transaction costs.~~Properties, Inc.

Income from Unconsolidated Joint Ventures

Income from unconsolidated joint ventures consisted of the Company's share of the following (in thousands):


	Three Months Ended June 30,									Six Months Ended June 30,									Three Months Ended March 31,
	2017			2016			$ Change			2017			2016			$ Change			2018			2017			$ Change
Net operating income	$	7,609		$	6,954		$	655		$	16,783		$	13,600		$	3,183		$	7,421		$	9,176		$	(1,755	)
Other income, net	240			87			153			1,705			541			1,164			350			1,464			(1,114		)
Depreciation and amortization	(3,478		)	(3,231		)	(247		)	(7,673		)	(6,490		)	(1,183		)	(3,419		)	(4,195		)	776
Interest expense	(1,922		)	(2,026		)	104			(4,246		)	(4,033		)	(213		)	(1,515		)	(2,325		)	810
Net gain on sale of investment property	37,871			—			37,871			34,332			—			34,332
Net gain (loss) on sale of investment property																			48			(3,539		)	3,587
Income from unconsolidated joint ventures	$	40,320		$	1,784		$	38,536		$	40,901		$	3,618		$	37,283		$	2,885		$	581		$	2,304

Net operating income and depreciation and amortization from unconsolidated joint ventures ~~increased $655,000 (9.4%)~~decreased $1.8 million and $776,000, respectively, between the ~~three month periods,~~2018 and ~~increased $3.2 million (23.4%) between the six~~2017 three month periods primarily due to ~~increased occupancy~~the sale of properties owned by EPI, LLC and ~~a change~~EPII, LLC ("Emory Point I and II") in the ~~partnership structure at Gateway Village whereby we began receiving 50%~~second quarter of ~~cash flows versus a preferred return beginning in December 2016,~~2017 and the ~~addition~~sale of our interest in Courvoisier Centre ~~which was acquired~~JV, LLC in the ~~Merger.~~fourth quarter of 2017. Other income ~~increased~~decreased $1.1 million between the three month periods primarily as a result of ~~a lease termination fee recognized at Terminus 200. Other income increased between the six month periods as a result of~~2017 lease termination fees recognized at ~~the Terminus 200 and~~ 111 West ~~Rio buildings and as a result of~~Rio. Interest expense decreased $810,000 between the three month periods primarily due to the sale of ~~mineral rights at CL Realty. The increase in depreciation~~Emory Point I and ~~amortization is due to Gateway Village~~II and repayment of the ~~addition of Courvoisier Centre. The gain on sale of depreciated property of $37.9 million~~related mortgage loans in the second quarter of ~~2017 resulted from the sale of properties owned by EP I, LLC and EP II, LLC.~~2017. The change in net gain (loss) on sale of ~~depreciated~~investment property ~~of $34.3 million for~~is primarily due to the ~~six months ended June 30,~~ 2017 ~~is comprised of the second quarter gain less a $3.5 million loss on the~~ purchase of the remaining 25.4% interest in the 111 West Rio building and the related consolidation of the building immediately following the ~~purchase.~~

~~Gain (Loss) on Sale of Investment Properties~~

The gain on the sale of investment properties in 2017 relates primarily to the sale of the ACS Center. The 2016 gain on sale of investment properties relates to the sale of 100 North Point Center East.

~~Table of Contents~~

~~Discontinued Operations~~

~~Discontinued operations in 2016 contains the operations of Post Oak Central and Greenway Plaza (the "Houston Properties"), the two~~purchase that ~~were included in the Spin-Off. Because we decided to exit the Houston market in connection with the Parkway Transactions, the Spin-Off represents~~generated a strategic shift that has a significant impact on our operations. As such, the Spin-Off of these properties qualifies for discontinued operations treatment. The operations of the Houston Properties have been reclassified into discontinued operations for the three and six months ended June 30, 2016.$3.5 million loss.

Funds From Operations

The table below shows Funds from Operations (“FFO”) and the related reconciliation to net income available to common stockholders. We calculate FFO in accordance with the National Association of Real Estate Investment Trusts’ (“NAREIT”) definition, which is net income available to common stockholders (computed in accordance with GAAP), excluding extraordinary items, cumulative effect of change in accounting principle and gains on sale or impairment losses on depreciable property, plus depreciation and amortization of real estate assets, and after adjustments for unconsolidated partnerships and joint ventures to reflect FFO on the same basis.

FFO is used by industry analysts and investors as a supplemental measure of a REIT’s operating performance. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, many industry investors and analysts have considered presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. Thus, NAREIT created FFO as a supplemental measure of REIT operating performance that excludes historical cost depreciation, among other items, from GAAP net income. The use of FFO, combined with the required primary GAAP presentations,

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has been fundamentally beneficial, improving the understanding of operating results of REITs among the investing public and making comparisons of REIT operating results more meaningful. Company management evaluates operating performance in part based on FFO. Additionally, we use FFO, along with other measures, to assess performance in connection with evaluating and granting incentive compensation to its officers and other key employees. The reconciliation of net income to FFO is as follows for the three months ended ~~June 30,~~March 31, 2018 and 2017 ~~and~~ ~~2016~~ (in thousands, except per share information):


	Three Months Ended June 30,					Six Months Ended June 30,						Three Months Ended March 31,
	2017			2016		2017			2016			2018			2017
Net Income Available to Common Stockholders	$	168,089		$	7,765	$	172,840		$	30,561		$	16,043		$	4,751
Depreciation and amortization of real estate assets:
Consolidated properties	49,575			16,306		104,009			32,470			44,620			54,433
Share of unconsolidated joint ventures	3,478			3,231		7,673			6,490			3,419			4,195
Discontinued Operations	—			15,740		—			31,168
Partners' share of real estate depreciation												(69		)	—
(Gain) loss on sale of depreciated properties:
Consolidated properties	(119,767		)	246		(119,750		)	(13,944		)	372			18
Share of unconsolidated joint ventures	(37,871		)	—		(34,332		)	—			(48		)	3,539
Non-controlling Interests related to unit holders	2,856			—		2,957			—			287			101
Funds From Operations	$	66,360		$	43,288	$	133,397		$	86,745		$	64,624		$	67,037
Per Common Share — Diluted:
Net Income Available Available to Common Shareholders	$	0.40		$	0.04	$	0.42		$	0.15		$	0.04		$	0.01
Funds from Operations	$	0.16		$	0.21	$	0.32		$	0.41		$	0.15		$	0.16
Weighted Average Shares — Basic	419,402			210,129		411,137			210,516
Weighted Average Shares — Diluted	427,180			210,362		419,227			210,687			427,695			411,186

Net Operating Income

Company management evaluates the performance of its property portfolio in part based on NOI. NOI represents rental property revenues less rental property operating expenses. NOI is not a measure of cash flows or operating results as measured by GAAP, is not indicative of cash available to fund cash needs, and should not be considered an alternative to cash flows as a measure of liquidity. All companies may not calculate NOI in the same manner. The Company considers NOI to be an appropriate supplemental measure to net income as it helps both management and investors understand the core operations of the Company's operating assets. NOI excludes corporate general and administrative expenses, interest expense, depreciation and amortization, impairments, gains/loss on sales of real estate, and other non-operating items.

~~Table of Contents~~

The following table reconciles NOI for consolidated properties to Net Income each of the periods presented (in thousands):


	Three Months Ended June 30,						Six Months Ended June 30,						Three Months Ended March 31,
	2017			2016			2017			2016			2018			2017
Net Income	$	170,945		$	7,765		$	175,803		$	30,561		$	16,406		$	4,858
Fee income	(1,854		)	(1,824		)	(3,791		)	(4,023		)	(2,894		)	(1,936		)
Other income	(3,174		)	(27		)	(8,600		)	(417		)	(960		)	(5,426		)
Reimbursed expenses	907			798			1,772			1,668			942			865
General and administrative expenses	8,618			4,691			14,828			12,934			6,809			6,182
Interest expense	8,523			5,369			18,264			10,808			9,778			9,741
Depreciation and amortization	50,040			16,641			104,924			33,182			45,093			54,884
Acquisition and transaction costs	246			2,424			2,177			2,443			91			1,930
Other expenses	236			152			612			507			320			404
Income from unconsolidated joint ventures	(40,320		)	(1,784		)	(40,901		)	(3,618		)	(2,885		)	(581		)
Gain (loss) on sale of investment properties	(119,832		)	246			(119,761		)	(13,944		)
Gain on extinguishment of debt	(1,829		)	—			(1,829		)	—
Income from discontinued operations	—			(7,523		)	—			(15,624		)
Loss on sale of investment properties													372			70
Loss on extinguishment of debt													85			—
Net Operating Income	$	72,506		$	26,928		$	143,498		$	54,477		$	73,157		$	70,991

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Liquidity and Capital Resources

Our primary short-term and long-term liquidity needs include the following:

property and land acquisitions;

expenditures on development projects;

building improvements, tenant improvements, and leasing costs;

principal and interest payments on indebtedness;

~~repurchase of our common stock;~~ and

operating partnership ~~distributions~~contributions and common stock dividends.

We may satisfy these needs with one or more of the following:

net cash from operations;

proceeds from the sale of assets;

borrowings under our ~~Credit Facility;~~credit facility;

proceeds from mortgage notes payable;

proceeds from construction loans;

proceeds from unsecured loans;

proceeds from offerings of debt or equity securities; and

joint venture formations.

During the first quarter of 2018, we recast our unsecured credit facility which, among other things, increased the size from $500 million to $1 billion, extended the maturity date from May 28, 2019 to January 3, 2023 and reduced the spread over LIBOR. As of ~~June 30, 2017,~~March 31, 2018, we had ~~$94.0 million~~no amounts drawn under ~~our~~the New Credit Facility and ~~$1.0 million drawn under our letters of credit, with~~had the ability to borrow ~~an additional $405.0~~$997 million ~~under our Credit Facility.~~

In April 2017, we closed a $350 million private placement of senior unsecured notes, which were issued in two tranches. The first tranche of $100 million was issued in April 2017, has a 10-year maturity, and has a fixed annual interest rate of 4.09%. The second tranche of $250 million was issued in July 2017, has an 8-year maturity, and has a fixed annual interest rate of 3.91%. We used the proceeds from the private placement to repay mortgages scheduled to mature during 2017.

In April 2017, we repaid in full, without penalty, the $128.0 million One Eleven Congress mortgage note and the $101.0 million San Jacinto Center mortgage note. In May 2017, we repaid in full, without penalty, the $52.0 million One Buckhead Plaza mortgage note. In conjunction with the sales of the ~~ACS Center, Emory Point I and Emory Point II, we used the proceeds~~$1 billion available with $3 million utilized by outstanding letters of ~~those sales to repay the associated mortgages.~~credit.

~~Subsequent to quarter end, in July 2017, we repaid in full, without penalty, the $77.9 million 3344 Peachtree mortgage note.~~

Contractual Obligations and Commitments

The following table sets forth information as of ~~June 30, 2017~~March 31, 2018 with respect to our outstanding contractual obligations and commitments (in thousands):


	Total		Less than 1 Year		1-3 Years		3-5 Years		More than 5 years		Total		Less than 1 Year		1-3 Years		3-5 Years		More than 5 years
Contractual Obligations:
Company debt:
Term Loan	$	250,000	$	—	$	—	$	250,000	$	—
Unsecured Senior Note	100,000		—		—		—		100,000
Unsecured Credit Facility	94,000		—		94,000		—		—		$	—	$	—	$	—	$	—	$	—
Unsecured Senior Notes											350,000		—		—		—		350,000
Unsecured Term Loan											250,000		—		250,000		—		—
Mortgage notes payable	580,950		86,532		43,710		45,213		405,495		496,602		7,188		78,130		97,042		314,242
Interest commitments (1)	204,645		31,876		61,359		51,588		59,822		259,112		40,873		80,488		62,983		74,768
Ground leases	208,610		2,321		4,642		4,713		196,934		206,869		2,321		4,660		4,748		195,140
Other operating leases	1,519		519		732		268		—		743		321		340		82		—
Total contractual obligations	$	1,439,724	$	121,248	$	204,443	$	351,782	$	762,251	$	1,563,326	$	50,703	$	413,618	$	164,855	$	934,150
Commitments:
Unfunded tenant improvements and construction obligations	$	180,878	$	162,897	$	17,981	$	—	$	—	$	58,390	$	56,708	$	1,682	$	—	$	—
Letters of credit	1,000		1,000		—		—		—		3,000		3,000		—		—		—
Performance bonds	2,861		328		1,600		—		933		665		665		—		—		—
Total commitments	$	184,739	$	164,225	$	19,581	$	—	$	933	$	62,055	$	60,373	$	1,682	$	—	$	—


(1)	Interest on variable rate obligations is based on rates effective as of ~~June 30, 2017.~~March 31, 2018.

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In addition, we have several standing or renewable service contracts mainly related to the operation of buildings. These contracts are in the ordinary course of business and are generally one year or less. These contracts are not included in the above table and are usually reimbursed in whole or in part by tenants.

Other Debt Information

Our existing mortgage debt is primarily non-recourse, fixed-rate mortgage notes secured by various real estate assets. Many of our non-recourse mortgages contain covenants which, if not satisfied, could result in acceleration of the maturity of the debt. We expect to either refinance the non-recourse mortgages at maturity or repay the mortgages with proceeds from asset sales, debt, or other capital sources.

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Future Capital Requirements

Over the long term, we intend to actively manage our portfolio of properties and strategically sell assets to generate capital for future investment activities. We expect to continue to utilize indebtedness to fund future commitments, if available and under appropriate terms. We may also seek equity capital and capital from joint venture partners to implement our strategy.

Our business model is dependent upon raising or recycling capital to meet obligations and to fund development and acquisition activity. If one or more sources of capital are not available when required, we may be forced to reduce the number of projects we acquire or develop and/or raise capital on potentially unfavorable terms, or we may be unable to raise capital, which could have an adverse effect on our financial position or results of operations.

Cash Flows Summary

We report and analyze our cash flows based on operating activities, investing activities, and financing activities. The following table ~~sets forth~~summarizes the changes in cash flows (in thousands):


	Six Months Ended June 30,									Three Months Ended March 31,
	2017			2016			Change			2018			2017			Change
Net cash provided by operating activities	$	126,237		$	60,094		$	66,143		$	20,906		$	25,233		$	(4,327	)
Net cash provided by (used in) investing activities	47,915			(73,564		)	121,479
Net cash used in investing activities										(82,813		)	(78,271		)	(4,542		)
Net cash provided by (used in) financing activities	(193,419		)	12,413			(205,832		)	(34,501		)	50,957			(85,458		)

The reasons for significant increases and decreases in cash flows between the periods are as follows:

Cash Flows from Operating Activities. Cash flows from operating activities ~~increased $66.1~~decreased $4.3 million between the 2018 and 2017 ~~and 2016 six~~three month periods primarily due to ~~an increase~~a decrease in cash generated from property operations as a result of the ~~Merger~~sale of ACS Center in July 2017 and ~~an increase~~the sales of Bank of America Center, One Orlando Centre, and Citrus Center in ~~operating distributions from joint ventures, offset by an increase~~December 2017 and a decrease in ~~cash interest paid~~lease termination fees between ~~the~~ periods.

Cash Flows from Investing Activities. Cash flows ~~from~~used in investing activities increased ~~$121.5~~$4.5 million between the 2018 and 2017 ~~and 2016 six~~three month periods primarily due to ~~proceeds from~~investment in the ~~ACSC sale, offset by an increase in property acquisition, development, and tenant asset expenditures. These increases were also impacted by larger contributions to and increased distributions from~~Austin 300 Colorado Project, LP unconsolidated joint ~~ventures which are primarily related to the sale of Emory Point I and II.~~venture.

Cash Flows from Financing Activities. Cash flows from financing activities decreased ~~$205.8~~$85.5 million between the 2018 and 2017 ~~and 2016 six~~three month periods primarily due to the ~~repayment of mortgage notes payable and decreased borrowings under the~~2017 common stock issuance, partially offset by 2017 credit facility ~~offset by the proceeds from the common stock equity offering in the first quarter 2017 and the issuance of senior notes in the second quarter.~~payments.

Capital Expenditures. We incur costs related to our real estate assets that include acquisition of properties, development of new properties, redevelopment of existing or newly purchased properties, leasing costs for new or replacement tenants, and ongoing property repairs and maintenance.

Capital expenditures for assets we develop or acquire and then hold and operate are included in the property acquisition, development, and tenant asset expenditures line item within investing activities on the condensed consolidated statements of cash flows. ~~Amounts~~The changes in amounts accrued are removed from the table below (accrued capital adjustment) to show the components of these costs on a cash basis. Components of costs included in this line item for the ~~six~~three months ended ~~June 30,~~March 31, 2018 and 2017 ~~and 2016~~ are as follows (in thousands):

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	Six Months Ended June 30,					Three Months Ended March 31,
	2017			2016		2018		2017
Development	$	102,544		$	29,100	$	11,823	$	41,121
Operating — leasing costs	24,224			14,764		15,629		10,001
Operating — building improvements	17,957			23,438		984		16,014
Capitalized interest	3,808			1,759		1,096		1,590
Capitalized personnel costs - leasing	1,053			948
Capitalized leasing commissions	1,668			885
Capitalized personnel costs - development	1,006			809
Capitalized personnel costs						2,178		2,396
Change in accrued capital expenditures	(1,110		)	3,891		28,465		(411		)
Total property acquisition and development expenditures	$	151,150		$	75,594	$	60,175	$	70,711

Capital expenditures, ~~increased~~including capitalized interest, decreased due to ~~an increase in the~~a number of development projects ~~between the periods and an increase in tenant leasing costs. Tenant leasing costs increased from properties acquired~~either completed or in the ~~Merger as well as an increase~~early stages of development and a decrease in ~~these costs at Cousins' legacy properties.~~building improvement projects. Tenant improvements and leasing costs, as well as related capitalized personnel costs, are a function of the number and size of newly executed leases or renewals of existing leases. Cash flow decreased from the changes in accrued capital expenditures primarily due to payments made related to the

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construction of 864 Spring Street becoming operational and payments due at that time. The amounts of tenant improvement and leasing costs for our office portfolio on a per square foot basis were as follows:


	Six Months Ended June 30,		Three Months Ended March 31,
	2017	2016	2018	2017
New leases	$6.98	$7.01	$6.04	$6.67
Renewal leases	$4.53	$4.02	$4.49	$3.74
Expansion leases	$7.40	$6.50	$6.41	$8.08

The amounts of tenant improvement and leasing costs on a per square foot basis vary by lease and by market. Given the level of expected leasing and renewal activity, management expects tenant improvements and leasing costs per square foot in future periods to remain consistent with those experienced in the first ~~six~~three months of ~~2017.~~2018.

Dividends. We paid common dividends of ~~$48.8~~$25.2 million and ~~$33.7~~$23.6 million in the 2018 and 2017 ~~and 2016~~ ~~six~~three month periods, respectively. We funded the common dividends with cash on hand and cash provided by operating activities. We expect to fund our future quarterly common dividends with cash provided by operating activities, proceeds from investment property sales, distributions from unconsolidated joint ventures, and indebtedness, if necessary.

On a quarterly basis, we review the amount of the common dividend in light of current and projected future cash flows from the sources noted above and also consider the requirements needed to maintain our REIT status. In addition, we have certain covenants under ~~our Credit Facility~~credit agreements which could limit the amount of common dividends paid. In general, common dividends of any amount can be paid as long as leverage, as defined in ~~the facility,~~our credit agreements, is less than 60% and we are not in ~~default under our facility.~~default. Certain conditions also apply in which we can still pay common dividends if leverage is above that amount. We routinely monitor the status of our common dividend payments in light of the covenants of our ~~Credit Facility covenants.~~credit agreements.

Off Balance Sheet Arrangements

General. We have a number of off balance sheet joint ventures with varying structures, as described in note 6 of our ~~2016~~2017 Annual Report on Form 10-K and note 42 of this Form 10-Q. The joint ventures in which we have an interest are involved in the ownership, acquisition, and/or development of real estate. A venture will fund capital requirements or operational needs with cash from operations or financing proceeds, if possible. If additional capital is deemed necessary, a venture may request a contribution from the partners, and we will evaluate such request.

Debt. At ~~June 30, 2017~~,March 31, 2018, our unconsolidated joint ventures had aggregate outstanding indebtedness to third parties of ~~$434.6~~$343.1 million. These loans are generally mortgage or construction loans, most of which are non-recourse to us except as described in the paragraph below. In addition, in certain instances, we provide “non-recourse carve-out guarantees” on these non-recourse loans. Certain of these loans have variable interest rates, which creates exposure to the ventures in the form of market risk from interest rate changes.

We guarantee 12.5% of the loan amount related to the Carolina Square construction loan, which has a lending capacity of $79.8 million, and an outstanding balance of ~~$50.5~~$70.4 million as of ~~June 30, 2017.~~March 31, 2018. At ~~June 30, 2017,~~March 31, 2018, we guaranteed ~~$6.3~~$8.8 million of the amount outstanding.

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Critical Accounting Policies

There have been no material changes in the critical accounting policies from those disclosed in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2017.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

There have been no material changes in the market risk associated with our notes payable at ~~June 30, 2017~~March 31, 2018 compared to that as disclosed in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2017.

Item 4. Controls and Procedures.

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Management necessarily applied

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its judgment in assessing the costs and benefits of such controls and procedures, which, by their nature, can provide only reasonable assurance regarding management’s control objectives.

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of management, including the Chief Executive Officer along with the Chief Financial Officer, of the effectiveness, design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)). Based upon the foregoing, the Chief Executive Officer along with the Chief Financial Officer concluded that our disclosure controls and procedures were effective. In addition, based on such evaluation we have identified no changes in our internal control over financial reporting that occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

Information regarding legal proceedings is described under the subheading "Litigation" in note 86 to the unaudited condensed consolidated financial statements set forth in this Form 10-Q.

Item 1A. Risk Factors

Risk factors that affect our business and financial results are discussed in Part I, "Item 1A. Risk Factors," of our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2017. There have been no material changes in our risk factors from those previously disclosed in our Annual ~~Report other than as set forth below.~~Report. You should carefully consider the risks described in our Annual Report, ~~and below,~~ which could materially affect our business, financial condition or future results. The risks described in our Annual Report ~~and below~~ are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem immaterial also may materially adversely affect our business, financial condition, and/or operating results. If any of the risks actually occur, our business, financial condition, and/or results of operations could be negatively affected.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

We did not make any sales of unregistered securities during the ~~second~~first quarter of ~~2017.~~2018.

We purchased the following common shares during the ~~second~~first quarter of ~~2017~~:2018:

Total Number of Shares Purchased* Average Price Paid per Share*
April 1 - 30 585
$ 8.49
May 1 - 31 —
—
June 1 - 30 —
—
585
$ 8.49



	Total Number of Shares Purchased*	Average Price Paid per Share*
January 1 - 31	31,072	$	8.95
February 1 - 28	52,504	8.61
March 1 - 31	—	—
	83,576	$	8.74

*Activity for the ~~second~~first quarter of ~~2017~~2018 related to the remittances of shares for income taxes in association with restricted stock vestings. For information on our equity compensation plans, see note 13 of our Annual Report on Form 10-K and note 108 to the unaudited condensed consolidated financial statements set forth in this Form 10-Q.

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Item 5. Other Information.

~~As of July 25, 2017,~~On April 24, 2018, the Company ~~entered into amendments~~held its annual meeting of stockholders. Proxies for the meeting were solicited pursuant to Regulation 14A under the ~~existing Change in Control Agreement with each~~Securities Exchange Act of ~~its executive officers. For each executive officer, the definition~~1934, as amended. The following matters were submitted to a vote of the ~~Company’s business~~stockholders:

Proposal 1 - the votes regarding the election of eight directors for a term expiring in 2019 were as follows:



Name	For	Against	Abstentions	Broker Non-Votes
Charles T. Cannada	391,235,670	4,402,007	177,389	8,034,398
Edward M. Casal	391,592,018	4,042,061	180,987	8,034,398
Robert M. Chapman	388,671,780	6,963,255	180,031	8,034,398
Lawrence L. Gellerstedt III	382,461,240	8,620,882	4,732,944	8,034,398
Lillian C. Giornelli	386,365,917	9,270,630	178,519	8,034,398
S. Taylor Glover	389,911,748	5,722,107	181,211	8,034,398
Donna W. Hyland	391,211,964	4,425,288	177,814	8,034,398
R. Dary Stone	390,003,016	5,630,911	181,139	8,034,398

Proposal 2 - the ~~protective covenant (which will be required~~advisory votes on executive compensation, often referred to ~~be entered into~~ as ~~consideration for any severance benefit under~~“say on pay,” were as follows:



For	Against	Abstentions	Broker Non-Votes
373,361,326	16,224,079	800,436	8,034,398

Proposal 3 - the ~~Agreement) has been revised~~votes to ~~mean~~ratify the ~~development, acquisition, financing, management, leasing and sale~~appointment of ~~commercial office properties. The executive officers are Lawrence L. Gellerstedt III, M. Colin Connolly, Gregg D. Adzema, Pamela F. Roper, John S. McColl and John D. Harris, Jr.~~

~~Mr. Gellerstedt’s agreement was also amended to remove~~Deloitte & Touche LLP as the gross-up provision and to replace it with the “best net” provision in the Agreements of Messrs. Adzema, Connolly and McColl and Ms. Roper, which provision acts to reduce payment to the applicable NEO if excise taxes would otherwise be triggered, to the extent that such a reduction results in a greater after-tax amountCompany's independent registered public accounting firm for the NEO. In addition, Mr. Gellerstedt’s agreement was amended to change the severance benefit payable under his agreement to an amount equal to 3.00 times the sum of his annual base salary plus his average cash bonus. In connection with her recent election to Executive Vice President, Ms. Roper’s agreement was also amended to change the severance benefit payable under her agreement to an amount equal to 2.00 times the sum of her annual base salary plus her average cash bonus, a calculation which is consistent with that of the Company’s other Executive Vice Presidents.fiscal year ending December 31, 2018 were as follows:



For	Against	Abstentions
392,842,388	5,362,791	215,060

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Item 6. Exhibits.




2.1		Agreement and Plan of Merger, dated April 28, 2016, by and among Parkway Properties, Inc., Parkway Properties LP, the Registrant and Clinic Sub Inc, filed as Exhibit 2.1 to the Registrant’s Current Report on Form 8-K filed on April 29, 2016, and incorporated herein by reference.

3.1		Restated and Amended Articles of Incorporation of the Registrant, as amended August 9, 1999, filed as Exhibit 3.1 to the Registrant’s Form 10-Q for the quarter ended June 30, 2002, and incorporated herein by reference.

3.1.1		Articles of Amendment to Restated and Amended Articles of Incorporation of the Registrant, as amended July 22, 2003, filed as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed on July 23, 2003, and incorporated herein by reference.

3.1.2		Articles of Amendment to Restated and Amended Articles of Incorporation of the Registrant, as amended December 15, 2004, filed as Exhibit 3(a)(i) to the Registrant’s Form 10-K for the year ended December 31, 2004, and incorporated herein by reference.

3.1.3		Articles of Amendment to Restated and Amended Articles of Incorporation of the Registrant, as amended May 4, 2010, filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed May 10, 2010, and incorporated herein by reference.

3.1.4		Articles of Amendment to Restated and Amended Articles of Incorporation of the Registrant, as amended May 9, 2014, filed as Exhibit 3.1.4 to the Registrant's Form 10-Q for the quarter ended June 30, 2014, and incorporated herein by reference.

3.1.5		Articles of Amendment to Restated and Amended Articles of Incorporation of Cousins, as amended October 6, 2016 (incorporated by reference from Exhibit 3.1 to the Registrant's Current Form 8-K filed on October 7, 2016).

3.1.6		Articles of Amendment to Restated and Amended Articles of Incorporation of Cousins, as amended October 6, 2016 (incorporated by reference from Exhibit 3.1.1 to the Registrant's Current Form 8-K filed on October 7, 2016).

3.2		Bylaws of the Registrant, as amended and restated December 4, 2012, filed as Exhibit 3.1 to the Registrant's Current Report on Form 8-K filed on December 7, 2012, and incorporated herein by reference.

~~10.1~~ 10	†	~~Form~~ Term Loan Agreement, dated as of ~~Amendment~~January 22, 2016, among the Registrant, the co-borrowers from time to ~~Change in Control Severance Agreement for Named Executive Officers.~~

~~10.2~~	†	~~Amendment to Change in Control Severance Agreement for Ms. Roper.~~

~~10.3~~	†	~~Amendment to Change in Control Severance Agreement for Mr. Gellerstedt.~~time party thereto, the lenders party thereto, and Bank of America, N.A., as administrative agent.

11.0	*	Computation of Per Share Earnings.

31.1	†	Certification of the Chief Executive Officer Pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2	†	Certification of the Chief Financial Officer Pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1	†	Certification of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2	†	Certification of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101	†	The following financial information for the Registrant, formatted in XBRL (Extensible Business Reporting Language): (i) the condensed consolidated balance sheets, (ii) the condensed consolidated statements of operations, (iii) the condensed consolidated statements of equity, (iv) the condensed consolidated statements of cash flows, and (v) the notes to condensed consolidated financial statements.



*		Data required by ASC 260, “Earnings per Share,” is provided in note 119 to the condensed consolidated financial statements included in this report.
†		Filed herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



	COUSINS PROPERTIES INCORPORATED
	/s/ Gregg D. Adzema
	Gregg D. Adzema
	Executive Vice President and Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer)

Date: ~~July 27, 2017~~April 25, 2018

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	Page No.
PART I-FINANCIAL INFORMATION	43
Item 1. Financial Statements (Unaudited)	43
CONDENSED CONSOLIDATED BALANCE SHEETS	3
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS	4
CONDENSED CONSOLIDATED STATEMENTS OF ~~OPERATIONS~~EQUITY	5
~~CONDENSED CONSOLIDATED STATEMENTS OF EQUITY~~	6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS	76
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS	87
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	2118
Item 3. Quantitative and Qualitative Disclosures About Market Risk	2823
Item 4. Controls and Procedures	2823

PART II. OTHER INFORMATION	2925
Item 1. Legal Proceedings	2925
Item 1A. Risk Factors	2925
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	2925
Item 5. Other Information	3026
Item 6. Exhibits	3127
SIGNATURES	3228



Six Months Ended June 30, 2017	Office		Mixed-Use		Total
Net Operating Income:
Atlanta	$	59,190	$	3,126	$	62,316
Austin	29,039		—		29,039
Charlotte	30,627		—		30,627
Orlando	7,108		—		7,108
Tampa	14,287		—		14,287
Phoenix	16,056		—		16,056
Other	848		—		848
Total Net Operating Income	$	157,155	$	3,126	$	160,281



	Total Number of Shares Purchased*	Average Price Paid per Share*
April 1 - 30	585	$	8.49
May 1 - 31	—	—
June 1 - 30	—	—
	585	$	8.49