Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Oct. 30, 2017 | |
Document and Entity Information | ||
Entity Registrant Name | Government Properties Income Trust | |
Entity Central Index Key | 1,456,772 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 99,145,921 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Real estate properties: | ||
Land | $ 269,332 | $ 267,855 |
Buildings and improvements | 1,660,379 | 1,620,905 |
Total real estate properties, gross | 1,929,711 | 1,888,760 |
Accumulated depreciation | (331,069) | (296,804) |
Total real estate properties, net | 1,598,642 | 1,591,956 |
Equity investment in Select Income REIT | 475,265 | 487,708 |
Assets of discontinued operations | 0 | 12,541 |
Acquired real estate leases, net | 99,953 | 124,848 |
Deposit escrow for FPO acquisition | 651,696 | 0 |
Cash and cash equivalents | 551,707 | 29,941 |
Restricted cash | 509 | 530 |
Rents receivable, net | 47,461 | 48,458 |
Deferred leasing costs, net | 22,250 | 21,079 |
Other assets, net | 89,484 | 68,005 |
Total assets | 3,536,967 | 2,385,066 |
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||
Unsecured revolving credit facility | 565,000 | 160,000 |
Unsecured term loans, net | 547,682 | 547,171 |
Senior unsecured notes, net | 943,543 | 646,844 |
Mortgage notes payable, net | 26,561 | 27,837 |
Liabilities of discontinued operations | 0 | 45 |
Accounts payable and other liabilities | 63,525 | 54,019 |
Due to related persons | 4,297 | 3,520 |
Assumed real estate lease obligations, net | 8,832 | 10,626 |
Total liabilities | 2,159,440 | 1,450,062 |
Commitments and contingencies | ||
Shareholders’ equity: | ||
Common shares of beneficial interest, $.01 par value: 150,000,000 and 100,000,000 shares authorized, 99,145,921 and 71,177,906 shares issued and outstanding, respectively | 991 | 712 |
Additional paid in capital | 1,968,249 | 1,473,533 |
Cumulative net income | 126,410 | 96,329 |
Cumulative other comprehensive income | 46,980 | 26,957 |
Cumulative common distributions | (765,103) | (662,527) |
Total shareholders’ equity | 1,377,527 | 935,004 |
Total liabilities and shareholders’ equity | $ 3,536,967 | $ 2,385,066 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Common shares of beneficial interest, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common shares of beneficial interest, shares authorized (in shares) | 150,000,000 | 100,000,000 |
Common shares of beneficial interest, shares issued (in shares) | 99,145,921 | 71,177,906 |
Common shares of beneficial interest, shares outstanding (in shares) | 99,145,921 | 71,177,906 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Statement [Abstract] | ||||
Rental income | $ 70,179 | $ 64,478 | $ 209,362 | $ 192,150 |
Expenses: | ||||
Real estate taxes | 8,862 | 7,591 | 24,980 | 22,810 |
Utility expenses | 5,408 | 5,483 | 14,186 | 13,330 |
Other operating expenses | 14,867 | 13,854 | 44,046 | 40,031 |
Depreciation and amortization | 20,781 | 18,404 | 61,949 | 54,713 |
Loss on impairment of real estate | 230 | 0 | 230 | 0 |
Acquisition related costs | 0 | 147 | 0 | 363 |
General and administrative | 3,266 | 3,816 | 12,314 | 11,350 |
Total expenses | 53,414 | 49,295 | 157,705 | 142,597 |
Operating income | 16,765 | 15,183 | 51,657 | 49,553 |
Dividend income | 304 | 304 | 911 | 667 |
Interest income | 1,715 | 47 | 1,843 | 63 |
Interest expense (including net amortization of debt premiums and discounts and debt issuance costs of $990, $805, $2,605 and $2,024, respectively) | (16,055) | (12,608) | (43,599) | (32,286) |
(Loss) gain on early extinguishment of debt | (1,715) | 0 | (1,715) | 104 |
Gain on issuance of shares by Select Income REIT | 51 | 72 | 72 | 88 |
Income (loss) from continuing operations before income taxes and equity in earnings of investees | 1,065 | 2,998 | 9,169 | 18,189 |
Income tax expense | (22) | (13) | (65) | (63) |
Equity in earnings of investees | 9,484 | 8,668 | 20,804 | 28,002 |
Income from continuing operations | 10,527 | 11,653 | 29,908 | 46,128 |
Income (loss) from discontinued operations | 462 | (154) | 173 | (429) |
Income before gain on sale of property | 10,989 | 11,499 | 30,081 | 45,699 |
Gain on sale of property | 0 | 79 | 0 | 79 |
Net income | 10,989 | 11,578 | 30,081 | 45,778 |
Other comprehensive income: | ||||
Unrealized gain on investment in available for sale securities | 3,279 | 8,463 | 14,389 | 28,571 |
Equity in unrealized gain of investees | 1,351 | 3,273 | 5,634 | 10,423 |
Other comprehensive income | 4,630 | 11,736 | 20,023 | 38,994 |
Comprehensive income | $ 15,619 | $ 23,314 | $ 50,104 | $ 84,772 |
Weighted average common shares outstanding (basic) (in shares) | 96,883 | 71,054 | 79,778 | 71,041 |
Weighted average common shares outstanding (diluted) (in shares) | 96,958 | 71,084 | 79,852 | 71,064 |
Per common share amounts (basic and diluted): | ||||
Income from continuing operations (in dollars per share) | $ 0.11 | $ 0.16 | $ 0.37 | $ 0.65 |
Income (loss) from discontinued operations (in dollars per share) | 0 | 0 | 0 | (0.01) |
Net income (in dollars per share) | $ 0.11 | $ 0.16 | $ 0.38 | $ 0.64 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Statement [Abstract] | ||||
Net amortization of debt premiums and discounts and deferred financing fees | $ 990 | $ 805 | $ 2,605 | $ 2,024 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 30,081 | $ 45,778 |
Adjustments to reconcile net income to cash provided by operating activities: | ||
Depreciation | 35,460 | 31,611 |
Net amortization of debt premiums and discounts and debt issuance costs | 2,605 | 2,024 |
Gain on sale of property | 0 | (79) |
Loss (gain) on early extinguishment of debt | 1,715 | (104) |
Straight line rental income | (3,115) | (1,789) |
Amortization of acquired real estate leases | 25,592 | 21,948 |
Amortization of deferred leasing costs | 2,790 | 2,343 |
Other non-cash expenses, net | 352 | 500 |
Loss on impairment of real estate | 230 | 0 |
Increase in carrying value of property included in discontinued operations | (619) | 0 |
Equity in earnings of investees | (20,804) | (28,002) |
Gain on issuance of shares by Select Income REIT | (72) | (88) |
Distributions of earnings from Select Income REIT | 18,062 | 25,676 |
Change in assets and liabilities: | ||
Restricted cash | 21 | 508 |
Deferred leasing costs | (2,846) | (7,998) |
Rents receivable | 3,839 | (126) |
Other assets | (7,045) | (1,466) |
Accounts payable and accrued expenses | 6,703 | (150) |
Due to related persons | 777 | 1,088 |
Net cash provided by operating activities | 93,726 | 91,674 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Real estate acquisitions and deposits | (666,202) | (83,705) |
Real estate improvements | (29,377) | (23,357) |
Distributions in excess of earnings from Select Income REIT | 20,063 | 11,951 |
Proceeds from sale of properties, net | 13,198 | 263 |
Net cash used in investing activities | (662,318) | (94,848) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Repayment of mortgage notes payable | (1,150) | (107,562) |
Proceeds from issuance of senior notes, after discounts | 297,954 | 300,235 |
Proceeds from issuance of common shares, net | 493,936 | 0 |
Borrowings on unsecured revolving credit facility | 610,000 | 254,000 |
Repayments on unsecured revolving credit facility | (205,000) | (346,000) |
Payment of debt issuance costs | (2,551) | (464) |
Repurchase of common shares | (255) | (312) |
Distributions to common shareholders | (102,576) | (91,759) |
Net cash provided by financing activities | 1,090,358 | 8,138 |
Increase in cash and cash equivalents | 521,766 | 4,964 |
Cash and cash equivalents at beginning of period | 29,941 | 8,785 |
Cash and cash equivalents at end of period | 551,707 | 13,749 |
Supplemental cash flow information: | ||
Interest paid | 42,019 | 32,599 |
Income taxes paid | 100 | 94 |
Non-cash investing activities: | ||
Sale of property | 0 | 3,600 |
Mortgage note receivable related to sale of property | $ 0 | $ (3,600) |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements of Government Properties Income Trust and its subsidiaries, or GOV, we, us or our, are unaudited. Certain information and disclosures required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements have been condensed or omitted. We believe the disclosures made are adequate to make the information presented not misleading. However, the accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2016 , or our Annual Report. In the opinion of our management, all adjustments, which include only normal recurring adjustments considered necessary for a fair presentation, have been included. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Our operating results for interim periods are not necessarily indicative of the results that may be expected for the full year. Reclassifications have been made to the prior years’ condensed consolidated financial statements to conform to the current year’s presentation. The preparation of these financial statements in conformity with GAAP requires us to make estimates and assumptions that affect reported amounts. Actual results could differ from those estimates. Significant estimates in the condensed consolidated financial statements include purchase price allocations, useful lives of fixed assets, impairment of real estate and equity method investments and the valuation of intangible assets. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements On January 1, 2017, we adopted the Financial Accounting Standards Board, or FASB, Accounting Standards Update, or ASU, No. 2017-01, Clarifying the Definition of a Business , which provides additional guidance on evaluating whether a transaction should be accounted for as an acquisition (or disposal) of assets or of a business. This update defines three requirements for a set of assets and activities (collectively referred to as a “set”) to be considered a business: inputs, processes and outputs. As a result of the implementation of this update, certain property acquisitions, which under previous guidance were accounted for as business combinations, are now accounted for as acquisitions of assets. In an acquisition of assets, certain acquisition costs are capitalized as opposed to expensed under the previous guidance. On January 1, 2017, we adopted FASB ASU No. 2016-09, Compensation - Stock Compensation , which identifies areas for simplification involving several aspects of accounting for share based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, an option to recognize gross stock compensation expense with actual forfeitures recognized as they occur, as well as certain classifications on the condensed statement of cash flows. The adoption of ASU No. 2016-09 did not have a material impact in our condensed consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, Revenue From Contracts With Customers , which outlines a comprehensive model for entities to use in accounting for revenue arising from contracts with customers. ASU No. 2014-09 states that “an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.” While ASU No. 2014-09 specifically references contracts with customers, it may apply to certain other transactions such as the sale of real estate or equipment. In August 2015, the FASB provided for a one-year deferral of the effective date for ASU No. 2014-09, which is now effective for us beginning January 1, 2018. A substantial portion of our revenue consists of rental income from leasing arrangements, which is specifically excluded from ASU No. 2014-09. We are continuing to evaluate ASU No. 2014-09 (and related clarifying guidance issued by the FASB); however, we do not expect its adoption to have a significant impact on the amount or timing of our revenue recognition in our consolidated financial statements with the exception of profit recognition on real estate sales. We currently have recorded a deferred gain on sale of real estate of $712 that under current guidance would be recognized upon repayment of a promissory note we received in connection with the sale but will be recognized in its entirety upon adoption of ASU No. 2014-09. We currently expect to adopt the standard using the modified retrospective approach. In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities , which changes how entities measure certain equity investments and present changes in the fair value of financial liabilities measured under the fair value option that are attributable to their own credit. This update is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted subject to certain conditions. Currently, changes in fair value of these investments are recorded through other comprehensive income. ASU No. 2016-01 states that these changes will be recorded through earnings. We are continuing to evaluate this guidance, but we expect the implementation of this guidance will affect how changes in the fair value of available for sale securities we hold are presented in our condensed consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases , which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). ASU No. 2016-02 requires lessees to apply a dual approach, classifying 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 or on a straight line basis over the term of the lease. A lessee is also required to record a right of use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. 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 No. 2016-02 is effective for reporting periods beginning after December 15, 2018, with early adoption permitted. We are currently assessing the potential impact the adoption of ASU No. 2016-02 will have in our condensed consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which requires that entities use a new forward looking “expected loss” model that generally will result in the earlier recognition of allowance for credit losses. The measurement of expected credit losses is based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. ASU No. 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. We are currently assessing the potential impact the adoption of ASU No. 2016-13 will have in our condensed consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. ASU No. 2016-15 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. We do not expect this guidance to have a material impact in our condensed consolidated financial statements and related disclosures. In November 2016, the FASB issued ASU No. 2016-18, Restricted Cash , which clarifies how companies should present restricted cash and restricted cash equivalents. Companies will show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. The new standard requires a reconciliation of the totals in the statement of cash flows to the related captions in the balance sheets. ASU No. 2016-18 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Upon the adoption of ASU No. 2016-18, we will reconcile both cash and cash equivalents and restricted cash and restricted cash equivalents, whereas under the current guidance we explain the changes during the period for cash and cash equivalents only. In May 2017, the FASB issued ASU No. 2017-09, Scope of Modification Accounting , which clarifies which changes to the terms or conditions of a share based payment award are subject to the guidance on modification accounting under ASC 718. Entities would apply the modification accounting guidance unless the value, vesting requirements and classification of a share based payment award are the same immediately before and after a change to the terms or conditions of the award. ASU No. 2017-09 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. We are continuing to evaluate ASU No. 2017-09; however, we do not expect its adoption to have a material impact in our condensed consolidated financial statements. |
Weighted Average Common Shares
Weighted Average Common Shares | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share, Basic and Diluted [Abstract] | |
Weighted Average Common Shares | Weighted Average Common Shares The following table provides a reconciliation of the weighted average number of common shares used in the calculation of basic and diluted earnings per share (in thousands): For the Three Months For the Nine Months Ended September 30, Ended September 30, 2017 2016 2017 2016 Weighted average common shares for basic earnings per share 96,883 71,054 79,778 71,041 Effect of dilutive securities: unvested share awards 75 30 74 23 Weighted average common shares for diluted earnings per share 96,958 71,084 79,852 71,064 |
Real Estate Properties
Real Estate Properties | 9 Months Ended |
Sep. 30, 2017 | |
Real Estate [Abstract] | |
Real Estate Properties | Real Estate Properties As of September 30, 2017 , we owned 74 properties ( 96 buildings), with an undepreciated carrying value of $1,929,711 . We generally lease space at our properties on a gross lease or modified gross lease basis pursuant to fixed term contracts expiring between 2017 and 2034. Our leases generally require us to pay all or some property operating expenses and to provide all or most property management services. During the three months ended September 30, 2017 , we entered into 14 leases for 436,102 rentable square feet, for a weighted (by rentable square feet) average lease term of 8.4 years and we made commitments for $7,902 of leasing related costs. During the nine months ended September 30, 2017 , we entered into 42 leases for 1,084,633 rentable square feet, for a weighted (by rentable square feet) average lease term of 8.8 years and we made commitments for $12,609 of leasing related costs. As of September 30, 2017 , we have estimated unspent leasing related obligations of $26,631 , and we have committed to redevelop and expand an existing property prior to commencement of the lease with an estimated remaining cost to complete as of September 30, 2017 of $3,302 . During the nine months ended September 30, 2017 , we capitalized $328 of interest expense related to the redevelopment and expansion of that existing property. We regularly evaluate whether events or changes in circumstances have occurred that could indicate an impairment in the value of our long lived assets. If there is an indication that the carrying value of an asset is not recoverable, we estimate the projected undiscounted cash flows to determine if an impairment loss should be recognized. We determine the amount of any impairment loss by comparing the historical carrying value to estimated fair value. We estimate fair value through an evaluation of recent financial performance and projected discounted cash flows using standard industry valuation techniques. In addition to consideration of impairment upon the events or changes in circumstances described above, we regularly evaluate the remaining lives of our long lived assets. If we change our estimate of the remaining lives, we allocate the carrying value of the affected assets over their revised remaining lives. Acquisition Activities During the nine months ended September 30, 2017 , we acquired an office property ( one building) located in Manassas, VA with 69,374 rentable square feet. This property was 100% leased to Prince William County on the date of acquisition. This transaction was accounted for as an acquisition of assets. The purchase price was $12,657 , including capitalized acquisition costs of $37 . Our allocation of the purchase price of this acquisition based on the estimated fair values of the acquired assets and assumed liabilities is presented in the table below. Number of Buildings Other Acquisition Properties/ Square Purchase and Assumed Date Location Type Buildings Feet Price Land Improvements Assets Jan-17 Manassas, VA Office 1/1 69,374 $ 12,657 $ 1,562 $ 8,253 $ 2,842 In September 2017, we acquired transferable development rights that will allow us to expand a property we own in Washington, D.C. for a purchase price of $2,030 , excluding acquisition costs. FPO Acquisition On October 2, 2017, we acquired First Potomac Realty Trust, or FPO, a Maryland REIT, pursuant to merger transactions, or collectively, the FPO Transaction, as a result of which, we acquired 39 office properties ( 74 buildings) with 6,454,382 rentable square feet, including two properties owned by joint ventures in which we acquired FPO's 50% and 51% interests. The estimated aggregate transaction value of the FPO Transaction was $1,374,624 , including $651,696 in cash consideration paid to FPO shareholders, the repayment of $483,000 of FPO debt, the assumption of $167,549 of FPO mortgage debt and an additional $82,000 of mortgage debt that encumber two joint venture properties that are 50% and 51% owned by FPO and the payment of certain transaction fees and expenses, net of FPO cash on hand. We currently expect to complete our purchase price allocation for the FPO Transaction in the fourth quarter of 2017 upon completion of third party appraisals and our analysis of acquired in place leases and building valuations. We financed the cash payments for the FPO Transaction with borrowings under our revolving credit facility and with cash on hand, including net proceeds from our public offerings of common shares and senior unsecured notes, as described further in Notes 7 and 9. The following table presents our pro forma results of operations for each of the nine months ended September 30, 2017 and 2016 as if the FPO Transaction and related financing activities had occurred on January 1, 2016. The historical FPO results of operations included in this pro forma financial information have been adjusted to remove the results of operations of properties and joint venture interests FPO sold since January 1, 2016. The effect of these adjustments was to decrease pro forma rental income $804 and $8,330 for the nine months ended September 30, 2017 and 2016 , respectively, and to decrease (increase) net income (loss) $47,019 and ($2,458) for the nine months ended September 30, 2017 and 2016 , respectively. This pro forma financial information is not necessarily indicative of what our actual results of operations would have been for the periods presented, nor does it represent the results of operations for any future period. Differences could result from numerous factors, including changes to our preliminary purchase price allocation for the FPO Transaction, future changes in our portfolio of investments, changes in interest rates, changes in our capital structure, changes in net property level operating expenses, changes in property level revenues, including rents expected to be received on our existing leases or leases we may enter into during and after 2017, and other reasons. Nine Months Ended September 30, 2017 2016 Rental income $ 328,255 $ 311,167 Net income (loss) (4,733 ) 19,411 Net income (loss) per share $ (0.05 ) $ 0.20 Disposition Activities – Continuing Operations On October 5, 2017, we sold one vacant office property ( one building) located in Albuquerque, NM with 29,045 rentable square feet and a net book value of $1,885 as of September 30, 2017 for $2,000 , excluding closing costs. During the three months ended September 30, 2017 , we recorded a $230 loss on impairment of real estate to reduce the carrying value of this property to its estimated fair value. Disposition Activities – Discontinued Operations In August 2017, we sold one vacant office property ( one building) in Falls Church, VA with 164,746 rentable square feet and a net book value of $12,901 as of the date of sale for $13,523 , excluding closing costs. Results of operations for this property, which qualified as held for sale prior to our adoption in 2014 of ASU No. 2014-8, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity , are classified as discontinued operations in our condensed consolidated financial statements. During the three months ended September 30, 2017 , we recorded an adjustment of $619 to increase the carrying value of this property to its estimated fair value less costs to sell. Summarized balance sheet and income statement information for this property is as follows: Balance Sheets September 30, December 31, 2017 2016 Real estate properties, net $ — $ 12,260 Other assets — 281 Assets of discontinued operations $ — $ 12,541 Other liabilities $ — $ 45 Liabilities of discontinued operations $ — $ 45 Statements of Operations Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Rental income $ 4 $ 6 $ 17 $ 62 Real estate taxes (40 ) (27 ) (88 ) (73 ) Utility expenses (17 ) (34 ) (97 ) (113 ) Other operating expenses (87 ) (70 ) (202 ) (219 ) General and administrative (17 ) (29 ) (76 ) (86 ) Increase in carrying value of property 619 — 619 — Income (loss) from discontinued operations $ 462 $ (154 ) $ 173 $ (429 ) |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2017 | |
Revenue Recognition [Abstract] | |
Revenue Recognition | Revenue Recognition We recognize rental income from operating leases that contain fixed contractual rent changes on a straight line basis over the term of the lease agreements. Certain of our leases with government tenants provide the tenant the right to terminate before the lease expiration date if the legislature or other funding authority does not appropriate the funding necessary for the government tenant to meet its lease obligations; we have determined the fixed non-cancelable lease term of these leases to be the full term of the lease because we believe the occurrence of early terminations to be remote contingencies based on both our historical experience and our assessments of the likelihood of lease cancellation on a separate lease basis. We increased rental income to record revenue on a straight line basis by $711 and $1,205 for the three months ended September 30, 2017 and 2016 , respectively, and $3,115 and $1,789 for the nine months ended September 30, 2017 and 2016 , respectively. Rents receivable include $24,801 and $21,686 of straight line rent receivables, net of allowance for doubtful accounts of $132 and $155 , at September 30, 2017 and December 31, 2016 , respectively. |
Concentration
Concentration | 9 Months Ended |
Sep. 30, 2017 | |
Risks and Uncertainties [Abstract] | |
Concentration | Concentration Tenant and Credit Concentration We define annualized rental income as the annualized contractual base rents from our tenants pursuant to our lease agreements as of the measurement date, plus straight line rent adjustments and estimated recurring expense reimbursements to be paid to us, and excluding lease value amortization. The U.S. Government, 13 state governments, and four other government tenants combined were responsible for 87.5% and 92.4% of our annualized rental income as of September 30, 2017 and 2016 , respectively. The U.S. Government is our largest tenant by annualized rental income and was responsible for 59.8% and 63.9% of our annualized rental income as of September 30, 2017 and 2016 , respectively. Geographic Concentration At September 30, 2017 , our 74 properties ( 96 buildings) were located in 31 states and the District of Columbia. Properties located in Virginia, California, the District of Columbia, Georgia, Maryland, New York and Massachusetts were responsible for 14.8% , 14.8% , 9.5% , 8.6% , 7.0% , 6.9% and 4.9% of our annualized rental income as of September 30, 2017 , respectively. |
Indebtedness
Indebtedness | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Indebtedness | Indebtedness Our principal debt obligations at September 30, 2017 were: (1) $565,000 of outstanding borrowings under our $750,000 unsecured revolving credit facility; (2) an aggregate outstanding principal amount of $550,000 of unsecured term loans; (3) an aggregate outstanding principal amount of $960,000 of public issuances of senior unsecured notes; and (4) $26,358 aggregate principal amount of mortgage notes. Our $750,000 revolving credit facility, our $300,000 term loan and our $250,000 term loan are governed by a credit agreement with a syndicate of institutional lenders that includes a number of features common to all of these credit arrangements. This credit agreement also includes a feature under which the maximum aggregate borrowing availability may be increased to up to $2,500,000 on a combined basis in certain circumstances. Our $750,000 revolving credit facility is available for general business purposes, including acquisitions. The maturity date of our revolving credit facility is January 31, 2019 and, subject to the payment of an extension fee and meeting other conditions, we have an option to extend the stated maturity date of our revolving credit facility by one year to January 31, 2020. We can borrow, repay and reborrow funds available under our revolving credit facility until maturity and no principal repayment is due until maturity. We are required to pay interest at the rate of LIBOR plus a premium, which was 125 basis points per annum at September 30, 2017 , on borrowings under our revolving credit facility. We also pay a facility fee on the total amount of lending commitments under our revolving credit facility, which was 25 basis points per annum at September 30, 2017 . Both the interest rate premium and the facility fee are subject to adjustment based upon changes to our credit ratings. As of September 30, 2017 , the annual interest rate payable on borrowings under our revolving credit facility was 2.4% and the weighted average annual interest rate for borrowings under our revolving credit facility was 2.4% and 1.7% for the three months ended September 30, 2017 and 2016 , respectively, and 2.2% and 1.7% for the nine months ended September 30, 2017 and 2016 , respectively. As of September 30, 2017 and October 30, 2017 , we had $565,000 and $545,000 outstanding under our revolving credit facility, respectively. Our $300,000 term loan, which matures on March 31, 2020, is prepayable without penalty at any time. We are required to pay interest at the rate of LIBOR plus a premium, which was 140 basis points per annum at September 30, 2017 , on the amount outstanding under our $300,000 term loan. The interest rate premium is subject to adjustment based upon changes to our credit ratings. As of September 30, 2017 , the annual interest rate for the amount outstanding under our $300,000 term loan was 2.6% . The weighted average annual interest rate under our $300,000 term loan was 2.6% and 1.9% for the three months ended September 30, 2017 and 2016 , respectively, and 2.4% and 1.9% for the nine months ended September 30, 2017 and 2016 , respectively. Our $250,000 term loan, which matures on March 31, 2022, is prepayable without penalty at any time. We are required to pay interest at the rate of LIBOR plus a premium, which was 180 basis points per annum as of September 30, 2017 , on the amount outstanding under our $250,000 term loan. The interest rate premium is subject to adjustment based upon changes to our credit ratings. As of September 30, 2017 , the annual interest rate for the amount outstanding under our $250,000 term loan was 3.0% . The weighted average annual interest rate under our $250,000 term loan was 3.0% and 2.3% , respectively, for the three months ended September 30, 2017 and 2016 and 2.8% and 2.3% for the nine months ended September 30, 2017 and 2016 , respectively. Our credit agreement and senior notes indentures and their supplements provide for acceleration of payment of all amounts due thereunder upon the occurrence and continuation of certain events of default, such as, in the case of our credit agreement, a change of control of us, which includes The RMR Group LLC, or RMR LLC, ceasing to act as our business and property manager. Our credit agreement and our senior notes indentures and their supplements also contain a number of covenants, including covenants that restrict our ability to incur debts, require us to maintain certain financial ratios and, in the case of our credit agreement, restrict our ability to make distributions under certain circumstances. We believe we were in compliance with the terms and conditions of the respective covenants under our credit agreement and senior notes indentures and their supplements at September 30, 2017 . On July 20, 2017, we issued $300,000 of 4.000% senior unsecured notes due 2022 in an underwritten public offering. The net proceeds from this offering of $295,403 , after payment of the underwriters' discount and other offering expenses, were used to finance, in part, the FPO Transaction. Concurrently with our entering into the FPO merger agreement, we entered a commitment letter with a group of institutional lenders for a 364 -day senior unsecured bridge loan facility in an initial aggregate principal amount of up to $750,000 . On July 20, 2017, we and the lenders terminated this commitment letter and bridge loan facility as a result of our issuance of the senior unsecured notes described above and the proceeds from the sale of our common shares in July 2017 (see Note 9 for more information regarding this sale), and we recognized a loss on extinguishment of debt of $1,715 . At September 30, 2017 , three of our properties ( three buildings) with an aggregate net book value of $50,031 were encumbered by three mortgages with an aggregate principal balance of $26,358 . These mortgage notes are non-recourse, subject to certain limited exceptions and do not contain any material financial covenants. As described in Note 4, in connection with the FPO Transaction we assumed five mortgage notes with an aggregate principal balance of $167,549 . These mortgage notes are secured by five properties ( five buildings). In connection with the FPO Transaction we also assumed two mortgage notes with an aggregate principal balance of $82,000 , which are secured by two properties owned by joint ventures in which we acquired FPO's 50% and 51% interests. |
Fair Value of Assets and Liabil
Fair Value of Assets and Liabilities | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Assets and Liabilities | Fair Value of Assets and Liabilities The table below presents certain of our assets measured at fair value at September 30, 2017 , categorized by the level of inputs, as defined in the fair value hierarchy under GAAP, used in the valuation of each asset: Fair Value at Reporting Date Using Quoted Prices in Significant Estimated Active Markets for Significant Other Unobservable Fair Identical Assets Observable Inputs Inputs Description Value (Level 1) (Level 2) (Level 3) Recurring Fair Value Measurements Assets: Investment in RMR Inc. (1) $ 62,351 $ 62,351 $ — $ — Non-Recurring Fair Value Measurements Assets: One property (2) $ 1,885 $ — $ 1,885 $ — (1) Our 1,214,225 shares of class A common stock of The RMR Group Inc., or RMR Inc., which are included in other assets in our condensed consolidated balance sheets, are reported at fair value which is based on quoted market prices (Level 1 inputs as defined in the fair value hierarchy under GAAP). Our historical cost basis for these shares is $26,888 as of September 30, 2017 . The net unrealized gain of $35,463 for these shares as of September 30, 2017 is included in cumulative other comprehensive income in our condensed consolidated balance sheets. (2) We estimated the fair value of this property at September 30, 2017 based upon the selling price agreed to with a third party (Level 2 inputs as defined in the fair value hierarchy under GAAP). See Note 4 for further details. In addition to the assets described in the table above, our financial instruments include cash and cash equivalents, restricted cash, rents receivable, mortgage notes receivable, accounts payable, our revolving credit facility, term loans, senior unsecured notes, mortgage notes payable, amounts due to related persons, other accrued expenses and security deposits. At September 30, 2017 and December 31, 2016 , the fair values of our financial instruments approximated their carrying values in our condensed consolidated financial statements due to their short term nature or variable interest rates, except as follows: As of September 30, 2017 As of December 31, 2016 Carrying Amount (1) Fair Value Carrying Amount (1) Fair Value Senior unsecured notes, 3.75% interest rate, due in 2019 $ 347,810 $ 357,625 $ 346,952 $ 354,078 Senior unsecured notes, 4.000% interest rate, due in 2022 295,587 302,655 — — Senior unsecured notes, 5.875% interest rate, due in 2046 300,146 325,500 299,892 292,268 Mortgage note payable, 5.88% interest rate, due in 2021 (2) 13,677 14,388 13,841 14,492 Mortgage note payable, 7.00% interest rate, due in 2019 (2) 8,490 8,739 8,778 9,188 Mortgage note payable, 8.15% interest rate, due in 2021 (2) 4,394 4,665 5,218 5,575 $ 970,104 $ 1,013,572 $ 674,681 $ 675,601 (1) Carrying amount includes certain unamortized debt issuance costs and unamortized premiums and discounts. (2) We assumed these mortgages in connection with our acquisitions of the encumbered properties. The stated interest rates for these mortgage debts are the contractually stated rates. We recorded the assumed mortgages at estimated fair value on the date of acquisition and we are amortizing the fair value premiums, if any, to interest expense over the respective terms of the mortgages to reduce interest expense to the estimated market interest rates as of the date of acquisition. We estimated the fair value of our senior unsecured notes due 2019 and due 2022 using an average of the bid and ask price of the notes as of the measurement date (Level 2 inputs as defined in the fair value hierarchy under GAAP). We estimated the fair value of our senior unsecured notes due 2046 based on the closing price on The Nasdaq Stock Market LLC, or Nasdaq, (Level 1 inputs as defined in the fair value hierarchy under GAAP) as of the measurement date. We estimated the fair values of our mortgage notes payable by using discounted cash flow analyses and currently prevailing market terms as of the measurement date (Level 3 inputs as defined in the fair value hierarchy under GAAP). Because Level 3 inputs are unobservable, our estimated fair value may differ materially from the actual fair value. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Distributions On February 23, 2017 , we paid a regular quarterly distribution to common shareholders of record on January 23, 2017 of $0.43 per share, or $30,606 . On May 22, 2017 , we paid a regular quarterly distribution to common shareholders of record on April 21, 2017 of $0.43 per share, or $30,606 . On August 21, 2017 , we paid a regular quarterly distribution to common shareholders of record on July 24, 2017 of $0.43 per share, or $41,364 . On October 12, 2017 , we declared a regular quarterly distribution payable to common shareholders of record on October 23, 2017 of $0.43 per share, or $42,633 . We expect to pay this distribution on or about November 20, 2017 using cash on hand and borrowings under our revolving credit facility. Sale of Shares On July 5, 2017, we sold 25,000,000 of our common shares at a price of $18.50 per share in an underwritten public offering. On August 3, 2017, we sold 2,907,029 of our common shares at a price of $18.50 per share pursuant to an overallotment option granted to the underwriters for the July offering. The aggregate net proceeds from these sales were $493,936 , after payment of the underwriters' discount and other offering expenses. Share Grants and Purchases On May 17, 2017 , we granted 3,000 of our common shares, valued at $21.75 per share, the closing price of our common shares on the Nasdaq on that day, to each of our six Trustees as part of their annual compensation. On May 17, 2017 , we withheld 450 of our common shares awarded to one of our Trustees to fund that Trustee's resulting minimum required tax withholding obligation. The aggregate value of the withheld shares was $10 , which is reflected as a decrease to shareholders' equity in our condensed consolidated balance sheets. On June 30, 2017, we purchased 278 of our common shares valued at $18.31 per share, the closing price of our common shares on the Nasdaq on that day, from a former employee of RMR LLC in satisfaction of tax withholding and payment obligations in connection with vesting of awards of our common shares. On September 14, 2017, we granted an aggregate of 57,350 of our common shares to our officers and certain other employees of RMR LLC, valued at $18.61 per share, the closing price of our common shares on the Nasdaq on that day. On September 19, 2017, we purchased an aggregate of 13,636 of our common shares valued at $18.30 per share, the closing price of our common shares on the Nasdaq on that day, from our officers and certain other employees of RMR LLC in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares. Cumulative Other Comprehensive Income Cumulative other comprehensive income represents the unrealized gain on the RMR Inc. shares we own and our share of the comprehensive income of our equity method investees, Select Income REIT, or SIR, and Affiliates Insurance Company, or AIC. The following table presents changes in the amounts we recognized in cumulative other comprehensive income by component for the three and nine months ended September 30, 2017 : Three Months Ended September 30, 2017 Unrealized Gain Equity in on Investment Unrealized Gain in Available for of Sale Securities Investees Total Balance at June 30, 2017 $ 32,184 $ 10,166 $ 42,350 Other comprehensive income before reclassifications 3,279 1,355 4,634 Amounts reclassified from cumulative other comprehensive loss to net income (1) — (4 ) (4 ) Net current period other comprehensive income 3,279 1,351 4,630 Balance at September 30, 2017 $ 35,463 $ 11,517 $ 46,980 Nine Months Ended September 30, 2017 Unrealized Gain Equity in on Investment Unrealized Gain in Available for of Sale Securities Investees Total December 31, 2016 $ 21,074 $ 5,883 $ 26,957 Other comprehensive income before reclassifications 14,389 5,626 20,015 Amounts reclassified from cumulative other comprehensive income to net income (1) — 8 8 Net current period other comprehensive income 14,389 5,634 20,023 Balance at September 30, 2017 $ 35,463 $ 11,517 $ 46,980 (1) Amounts reclassified from cumulative other comprehensive income (loss) are included in equity in earnings of investees in our condensed consolidated statements of comprehensive income. |
Business and Property Managemen
Business and Property Management Agreements with RMR LLC | 9 Months Ended |
Sep. 30, 2017 | |
Property Management Fee [Abstract] | |
Business and Property Management Agreements with RMR LLC | Business and Property Management Agreements with RMR LLC We have no employees. The personnel and various services we require to operate our business are provided to us by RMR LLC. We have two agreements with RMR LLC to provide management services to us: (1) a business management agreement, which relates to our business generally; and (2) a property management agreement, which relates to our property level operations. Pursuant to our business management agreement with RMR LLC, we recognized net business management fees of $1,891 and $2,572 for the three months ended September 30, 2017 and 2016 , respectively, and $8,241 and $7,614 for the nine months ended September 30, 2017 and 2016 , respectively. As of September 30, 2017 , no annual incentive fees were estimated, based on our common share total return, as defined, as of September 30, 2017 , to be payable to RMR LLC for 2017. The business management fee for the three months ended September 30, 2017 includes the reversal of $893 of estimated incentive fees accrued as of June 30, 2017. The actual amount of annual incentive fees payable to RMR LLC for 2017, if any, will be based on our common share total return, as defined, for the three year period ending December 31, 2017, and will be payable in 2018. The net business management fees we recognized are included in general and administrative expenses in our condensed consolidated statements of comprehensive income. Pursuant to our property management agreement with RMR LLC, we recognized aggregate net property management and construction supervision fees of $2,338 and $2,249 for the three months ended September 30, 2017 and 2016 , respectively, and $7,371 and $6,636 for the nine months ended September 30, 2017 and 2016 , respectively. These amounts are included in other operating expenses or have been capitalized, as appropriate, in our condensed consolidated financial statements. We are generally responsible for all of our operating expenses, including certain expenses incurred by RMR LLC on our behalf. Our property level operating expenses, including certain payroll and related costs incurred by RMR LLC, are generally incorporated into rents charged to our tenants. We reimbursed RMR LLC $3,436 and $3,221 for property management related expenses for the three months ended September 30, 2017 and 2016 , respectively, and $10,482 and $9,132 for the nine months ended September 30, 2017 and 2016 , respectively, which amounts are included in other operating expenses in our condensed consolidated statements of comprehensive income. In addition, we are responsible for our share of RMR LLC’s costs for providing our internal audit function. The amount recognized as expense for internal audit costs was $67 and $34 for the three months ended September 30, 2017 and 2016 , respectively, and $202 and $168 for the nine months ended September 30, 2017 and 2016 , respectively. We include these amounts in general and administrative expenses in our condensed consolidated statements of comprehensive income. |
Related Person Transactions
Related Person Transactions | 9 Months Ended |
Sep. 30, 2017 | |
Related Party Transactions [Abstract] | |
Related Person Transactions | Related Person Transactions We have relationships and historical and continuing transactions with RMR LLC, RMR Inc., SIR, AIC and others related to them, including other companies to which RMR LLC provides management services and which have trustees, directors and officers who are also our Trustees or officers. Our Manager, RMR LLC. See Note 10 for further information regarding our management agreements with RMR LLC. We have historically granted share awards to certain RMR LLC employees under our equity compensation plans. In September 2017 and 2016, we granted annual share awards of 57,350 and 53,400 of our common shares, respectively, to our officers and to other employees of RMR LLC. In September 2017 and 2016, we purchased 13,636 and 13,209 of our common shares, respectively, at the closing price of our common shares on the Nasdaq on the date of purchase from our officers and other employees of RMR LLC in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares. We include amounts recognized as expense for share awards to RMR LLC employees in general and administrative expenses in our condensed consolidated statements of comprehensive income. RMR Inc. RMR LLC is a subsidiary of RMR Inc. and RMR Inc. is the managing member of RMR LLC. The controlling shareholder of RMR Inc., ABP Trust, is owned by our Managing Trustees. As of September 30, 2017 , we owned 1,214,225 shares of class A common stock of RMR Inc. See Note 8 for further information regarding our investment in RMR Inc. SIR . As of September 30, 2017 , we owned 24,918,421 of SIR's common shares, or approximately 27.8% of its outstanding common shares. Our Managing Trustees also serve as managing trustees of SIR, our President and Chief Operating Officer and one of our Independent Trustees also serves as the president and chief operating officer and an independent trustee of SIR, respectively. RMR LLC provides management services to SIR and us. See Note 12 for further information regarding our investment in SIR. AIC . We, SIR, ABP Trust and four other companies to which RMR LLC provides management services currently own AIC, an Indiana insurance company, in equal amounts. We and the other AIC shareholders participate in a combined property insurance program arranged and reinsured in part by AIC. We paid aggregate annual premiums, including taxes and fees, of approximately $757 in connection with this insurance program for the policy year ending June 30, 2018, which amount may be adjusted from time to time as we acquire and dispose of properties that are included in this insurance program. As of September 30, 2017 and December 31, 2016, our investment in AIC had a carrying value of $8,064 and $7,235 , respectively. These amounts are included in other assets in our condensed consolidated balance sheets. We recognized income related to our investment in AIC, which amounts are presented as equity in earnings of investees in our condensed consolidated statements of comprehensive income. Our other comprehensive income includes our proportionate part of unrealized gains on securities which are owned and held for sale by AIC. For further information about these and other such relationships and certain other related person transactions, please refer to our Annual Report. |
Equity Investment in Select Inc
Equity Investment in Select Income REIT | 9 Months Ended |
Sep. 30, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Investment in Select Income REIT | Equity Investment in Select Income REIT As described in Note 11, as of September 30, 2017 , we owned 24,918,421 , or approximately 27.8% , of the then outstanding SIR common shares. SIR is a REIT which owns properties that are primarily leased to single tenants. We account for our investment in SIR under the equity method. Under the equity method, we record our proportionate share of SIR’s net income as equity in earnings of an investee in our condensed consolidated statements of comprehensive income. We recorded $9,453 and $8,655 of equity in the earnings of SIR for the three months ended September 30, 2017 and 2016 , respectively, and $20,271 and $27,895 of equity in the earnings of SIR for the nine months ended September 30, 2017 and 2016 , respectively. Our other comprehensive income includes our proportionate share of SIR’s unrealized gains of $1,236 and $3,192 for the three months ended September 30, 2017 and 2016 , respectively, and $5,339 and $10,248 for the nine months ended September 30, 2017 and 2016 , respectively. The adjusted GAAP cost basis of our investments in SIR was less than our proportionate share of SIR’s total shareholders’ equity book value on the dates we acquired the shares. As of September 30, 2017 , our remaining basis difference was $87,976 and, as required under GAAP, we are accreting this basis difference to earnings over the estimated remaining useful lives of certain real estate assets and intangible assets and liabilities owned by SIR. This accretion increased our equity in the earnings of SIR by $736 and $740 for the three months ended September 30, 2017 and 2016 , respectively, and $2,209 and $2,219 for the nine months ended September 30, 2017 and 2016 , respectively. As of September 30, 2017 , our investment in SIR had a carrying value of $475,265 and a market value, based on the closing price of SIR common shares on the Nasdaq on September 30, 2017 , of $583,589 . We periodically evaluate our equity investment in SIR for possible indicators of other than temporary impairment whenever events or changes in circumstances indicate the carrying amount of the investment might not be recoverable. These indicators may include the length of time the market value of our investment is below our cost basis, the financial condition of SIR, our intent and ability to be a long term holder of the investment and other considerations. If the decline in fair value is judged to be other than temporary, we may record an impairment charge to adjust the basis of the investment to its fair value. We received cash distributions from SIR totaling $12,708 during each of the three months ended September 30, 2017 and 2016 and $38,125 and $37,627 during the nine months ended September 30, 2017 and 2016 , respectively. The following are summarized financial data of SIR as reported in SIR’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2017 , or the SIR Quarterly Report. References in our condensed consolidated financial statements to the SIR Quarterly Report are included as references to the source of the data only, and the information in the SIR Quarterly Report is not incorporated by reference into our condensed consolidated financial statements. Condensed Consolidated Balance Sheets September 30, December 31, 2017 2016 Real estate properties, net $ 3,922,568 $ 3,899,792 Acquired real estate leases, net 493,780 506,298 Properties held for sale 5,829 — Cash and cash equivalents 18,155 22,127 Rents receivable, net 122,292 124,089 Other assets, net 114,771 87,376 Total assets $ 4,677,395 $ 4,639,682 Unsecured revolving credit facility $ 102,000 $ 327,000 Unsecured term loan, net 348,746 348,373 Senior unsecured notes, net 1,776,087 1,430,300 Mortgage notes payable, net 227,772 245,643 Assumed real estate lease obligations, net 70,989 77,622 Other liabilities 129,502 136,782 Shareholders' equity 2,022,299 2,073,962 Total liabilities and shareholders' equity $ 4,677,395 $ 4,639,682 Condensed Consolidated Statements of Income Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Rental income $ 98,635 $ 96,037 $ 293,020 $ 290,512 Tenant reimbursements and other income 19,379 18,999 57,158 56,660 Total revenues 118,014 115,036 350,178 347,172 Real estate taxes 11,489 10,755 33,168 31,565 Other operating expenses 14,649 14,394 41,039 39,987 Depreciation and amortization 34,713 33,366 102,770 100,240 Acquisition related costs — 13 — 71 General and administrative 1,589 7,553 24,658 21,903 Write-off of straight line rents receivable, net — — 12,517 — Loss on asset impairment — — 4,047 — Loss on impairment of real estate assets — — 229 — Total expenses 62,440 66,081 218,428 193,766 Operating income 55,574 48,955 131,750 153,406 Dividend income 397 397 1,190 872 Interest expense (24,383 ) (20,690 ) (68,278 ) (61,883 ) Income before income tax expense and equity in earnings of an investee 31,588 28,662 64,662 92,395 Income tax expense (177 ) (107 ) (364 ) (370 ) Equity in earnings of an investee 31 13 533 107 Net income 31,442 28,568 64,831 92,132 Net income allocated to noncontrolling interest — — — (33 ) Net income attributed to SIR $ 31,442 $ 28,568 $ 64,831 $ 92,099 Weighted average common shares outstanding (basic) 89,355 89,308 89,341 89,295 Weighted average common shares outstanding (diluted) $ 89,379 $ 89,334 $ 89,364 $ 89,318 Net income attributed to SIR per common share (basic and diluted) $ 0.35 $ 0.32 $ 0.73 $ 1.03 |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information We operate in two separate reportable business segments: direct ownership of real estate properties and our equity method investment in SIR. Three Months Ended September 30, 2017 Investment Investment in Real Estate in SIR Corporate Consolidated Rental income $ 70,179 $ — $ — $ 70,179 Expenses: Real estate taxes 8,862 — — 8,862 Utility expenses 5,408 — — 5,408 Other operating expenses 14,867 — — 14,867 Depreciation and amortization 20,781 — — 20,781 Loss on impairment of real estate 230 — — 230 General and administrative — — 3,266 3,266 Total expenses 50,148 — 3,266 53,414 Operating income (loss) 20,031 — (3,266 ) 16,765 Dividend income — — 304 304 Interest income 54 — 1,661 1,715 Interest expense (401 ) — (15,654 ) (16,055 ) Loss on early extinguishment of debt — (1,715 ) (1,715 ) Gain on issuance of shares by Select Income REIT — 51 — 51 Income (loss) from continuing operations before income taxes and equity in earnings of investees 19,684 51 (18,670 ) 1,065 Income tax expense — — (22 ) (22 ) Equity in earnings of investees — 9,453 31 9,484 Income (loss) from continuing operations 19,684 9,504 (18,661 ) 10,527 Income from discontinued operations 462 — — 462 Net income (loss) $ 20,146 $ 9,504 $ (18,661 ) $ 10,989 Nine Months Ended September 30, 2017 Investment Investment in Real Estate in SIR Corporate Consolidated Rental income $ 209,362 $ — $ — $ 209,362 Expenses: Real estate taxes 24,980 — — 24,980 Utility expenses 14,186 — — 14,186 Other operating expenses 44,046 — — 44,046 Depreciation and amortization 61,949 — — 61,949 Loss on impairment of real estate 230 — — 230 General and administrative — — 12,314 12,314 Total expenses 145,391 — 12,314 157,705 Operating income (loss) 63,971 — (12,314 ) 51,657 Dividend income — — 911 911 Interest income 148 — 1,695 1,843 Interest expense (1,238 ) — (42,361 ) (43,599 ) Loss on early extinguishment of debt (1,715 ) — — (1,715 ) Gain on issuance of shares by Select Income REIT — 72 — 72 Income (loss) from continuing operations before income taxes and equity in earnings of investees 61,166 72 (52,069 ) 9,169 Income tax expense — — (65 ) (65 ) Equity in earnings of investees — 20,271 533 20,804 Income (loss) from continuing operations 61,166 20,343 (51,601 ) 29,908 Income from discontinued operations 173 — — 173 Net income (loss) $ 61,339 $ 20,343 $ (51,601 ) $ 30,081 As of September 30, 2017 Investment Investment in Real Estate in SIR Corporate Consolidated Total Assets $ 1,780,753 $ 475,265 $ 1,280,949 $ 3,536,967 Three Months Ended September 30, 2016 Investment Investment in Real Estate in SIR Corporate Consolidated Rental income $ 64,478 $ — $ — $ 64,478 Expenses: Real estate taxes 7,591 — — 7,591 Utility expenses 5,483 — — 5,483 Other operating expenses 13,854 — — 13,854 Depreciation and amortization 18,404 — — 18,404 Acquisition related costs 147 — — 147 General and administrative — — 3,816 3,816 Total expenses 45,479 — 3,816 49,295 Operating income (loss) 18,999 — (3,816 ) 15,183 Dividend income — — 304 304 Interest income — — 47 47 Interest expense (429 ) — (12,179 ) (12,608 ) Gain on issuance of shares by Select Income REIT — 72 — 72 Income (loss) from continuing operations before income taxes and equity in earnings of investees 18,570 72 (15,644 ) 2,998 Income tax expense — — (13 ) (13 ) Equity in earnings of investees — 8,655 13 8,668 Income (loss) from continuing operations 18,570 8,727 (15,644 ) 11,653 Loss from discontinued operations (154 ) — — (154 ) Income (loss) before gain on sale of property 18,416 8,727 (15,644 ) 11,499 Gain on sale of property 79 — — 79 Net income (loss) $ 18,495 $ 8,727 $ (15,644 ) $ 11,578 Nine Months Ended September 30, 2016 Investment Investment in Real Estate in SIR Corporate Consolidated Rental income $ 192,150 $ — $ — $ 192,150 Expenses: Real estate taxes 22,810 — — 22,810 Utility expenses 13,330 — — 13,330 Other operating expenses 40,031 — — 40,031 Depreciation and amortization 54,713 — — 54,713 Acquisition related costs 363 — — 363 General and administrative — — 11,350 11,350 Total expenses 131,247 — 11,350 142,597 Operating income (loss) 60,903 — (11,350 ) 49,553 Dividend income — — 667 667 Interest income — — 63 63 Interest expense (1,953 ) — (30,333 ) (32,286 ) Gain on early extinguishment of debt 104 — — 104 Gain on issuance of shares by Select Income REIT — 88 — 88 Income (loss) from continuing operations before income taxes and equity in earnings of investees 59,054 88 (40,953 ) 18,189 Income tax expense — — (63 ) (63 ) Equity in earnings of investees — 27,895 107 28,002 Income (loss) from continuing operations 59,054 27,983 (40,909 ) 46,128 Loss from discontinued operations (429 ) — — (429 ) Income (loss) before gain on sale of property 58,625 27,983 (40,909 ) 45,699 Gain on sale of property 79 — — 79 Net income (loss) $ 58,704 $ 27,983 $ (40,909 ) $ 45,778 As of December 31, 2016 Investment Investment in Real Estate in SIR Corporate Consolidated Total Assets $ 1,807,560 $ 487,708 $ 89,798 $ 2,385,066 |
Recent Accounting Pronounceme20
Recent Accounting Pronouncements (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements On January 1, 2017, we adopted the Financial Accounting Standards Board, or FASB, Accounting Standards Update, or ASU, No. 2017-01, Clarifying the Definition of a Business , which provides additional guidance on evaluating whether a transaction should be accounted for as an acquisition (or disposal) of assets or of a business. This update defines three requirements for a set of assets and activities (collectively referred to as a “set”) to be considered a business: inputs, processes and outputs. As a result of the implementation of this update, certain property acquisitions, which under previous guidance were accounted for as business combinations, are now accounted for as acquisitions of assets. In an acquisition of assets, certain acquisition costs are capitalized as opposed to expensed under the previous guidance. On January 1, 2017, we adopted FASB ASU No. 2016-09, Compensation - Stock Compensation , which identifies areas for simplification involving several aspects of accounting for share based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, an option to recognize gross stock compensation expense with actual forfeitures recognized as they occur, as well as certain classifications on the condensed statement of cash flows. The adoption of ASU No. 2016-09 did not have a material impact in our condensed consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, Revenue From Contracts With Customers , which outlines a comprehensive model for entities to use in accounting for revenue arising from contracts with customers. ASU No. 2014-09 states that “an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.” While ASU No. 2014-09 specifically references contracts with customers, it may apply to certain other transactions such as the sale of real estate or equipment. In August 2015, the FASB provided for a one-year deferral of the effective date for ASU No. 2014-09, which is now effective for us beginning January 1, 2018. A substantial portion of our revenue consists of rental income from leasing arrangements, which is specifically excluded from ASU No. 2014-09. We are continuing to evaluate ASU No. 2014-09 (and related clarifying guidance issued by the FASB); however, we do not expect its adoption to have a significant impact on the amount or timing of our revenue recognition in our consolidated financial statements with the exception of profit recognition on real estate sales. We currently have recorded a deferred gain on sale of real estate of $712 that under current guidance would be recognized upon repayment of a promissory note we received in connection with the sale but will be recognized in its entirety upon adoption of ASU No. 2014-09. We currently expect to adopt the standard using the modified retrospective approach. In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities , which changes how entities measure certain equity investments and present changes in the fair value of financial liabilities measured under the fair value option that are attributable to their own credit. This update is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted subject to certain conditions. Currently, changes in fair value of these investments are recorded through other comprehensive income. ASU No. 2016-01 states that these changes will be recorded through earnings. We are continuing to evaluate this guidance, but we expect the implementation of this guidance will affect how changes in the fair value of available for sale securities we hold are presented in our condensed consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases , which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). ASU No. 2016-02 requires lessees to apply a dual approach, classifying 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 or on a straight line basis over the term of the lease. A lessee is also required to record a right of use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. 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 No. 2016-02 is effective for reporting periods beginning after December 15, 2018, with early adoption permitted. We are currently assessing the potential impact the adoption of ASU No. 2016-02 will have in our condensed consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which requires that entities use a new forward looking “expected loss” model that generally will result in the earlier recognition of allowance for credit losses. The measurement of expected credit losses is based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. ASU No. 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. We are currently assessing the potential impact the adoption of ASU No. 2016-13 will have in our condensed consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. ASU No. 2016-15 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. We do not expect this guidance to have a material impact in our condensed consolidated financial statements and related disclosures. In November 2016, the FASB issued ASU No. 2016-18, Restricted Cash , which clarifies how companies should present restricted cash and restricted cash equivalents. Companies will show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. The new standard requires a reconciliation of the totals in the statement of cash flows to the related captions in the balance sheets. ASU No. 2016-18 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Upon the adoption of ASU No. 2016-18, we will reconcile both cash and cash equivalents and restricted cash and restricted cash equivalents, whereas under the current guidance we explain the changes during the period for cash and cash equivalents only. In May 2017, the FASB issued ASU No. 2017-09, Scope of Modification Accounting , which clarifies which changes to the terms or conditions of a share based payment award are subject to the guidance on modification accounting under ASC 718. Entities would apply the modification accounting guidance unless the value, vesting requirements and classification of a share based payment award are the same immediately before and after a change to the terms or conditions of the award. ASU No. 2017-09 is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. We are continuing to evaluate ASU No. 2017-09; however, we do not expect its adoption to have a material impact in our condensed consolidated financial statements. |
Weighted Average Common Shares
Weighted Average Common Shares (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share, Basic and Diluted [Abstract] | |
Weighted Average Common Share Amounts | The following table provides a reconciliation of the weighted average number of common shares used in the calculation of basic and diluted earnings per share (in thousands): For the Three Months For the Nine Months Ended September 30, Ended September 30, 2017 2016 2017 2016 Weighted average common shares for basic earnings per share 96,883 71,054 79,778 71,041 Effect of dilutive securities: unvested share awards 75 30 74 23 Weighted average common shares for diluted earnings per share 96,958 71,084 79,852 71,064 |
Real Estate Properties (Tables)
Real Estate Properties (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Real Estate [Abstract] | |
Schedule of purchase prices of acquisitions allocated based on the estimated fair values of the acquired assets and assumed liabilities | Our allocation of the purchase price of this acquisition based on the estimated fair values of the acquired assets and assumed liabilities is presented in the table below. Number of Buildings Other Acquisition Properties/ Square Purchase and Assumed Date Location Type Buildings Feet Price Land Improvements Assets Jan-17 Manassas, VA Office 1/1 69,374 $ 12,657 $ 1,562 $ 8,253 $ 2,842 |
Pro forma information | The following table presents our pro forma results of operations for each of the nine months ended September 30, 2017 and 2016 as if the FPO Transaction and related financing activities had occurred on January 1, 2016. The historical FPO results of operations included in this pro forma financial information have been adjusted to remove the results of operations of properties and joint venture interests FPO sold since January 1, 2016. The effect of these adjustments was to decrease pro forma rental income $804 and $8,330 for the nine months ended September 30, 2017 and 2016 , respectively, and to decrease (increase) net income (loss) $47,019 and ($2,458) for the nine months ended September 30, 2017 and 2016 , respectively. This pro forma financial information is not necessarily indicative of what our actual results of operations would have been for the periods presented, nor does it represent the results of operations for any future period. Differences could result from numerous factors, including changes to our preliminary purchase price allocation for the FPO Transaction, future changes in our portfolio of investments, changes in interest rates, changes in our capital structure, changes in net property level operating expenses, changes in property level revenues, including rents expected to be received on our existing leases or leases we may enter into during and after 2017, and other reasons. Nine Months Ended September 30, 2017 2016 Rental income $ 328,255 $ 311,167 Net income (loss) (4,733 ) 19,411 Net income (loss) per share $ (0.05 ) $ 0.20 |
Summarized balance sheet and income statement information for properties classified as discontinued operations | Summarized balance sheet and income statement information for this property is as follows: Balance Sheets September 30, December 31, 2017 2016 Real estate properties, net $ — $ 12,260 Other assets — 281 Assets of discontinued operations $ — $ 12,541 Other liabilities $ — $ 45 Liabilities of discontinued operations $ — $ 45 Statements of Operations Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Rental income $ 4 $ 6 $ 17 $ 62 Real estate taxes (40 ) (27 ) (88 ) (73 ) Utility expenses (17 ) (34 ) (97 ) (113 ) Other operating expenses (87 ) (70 ) (202 ) (219 ) General and administrative (17 ) (29 ) (76 ) (86 ) Increase in carrying value of property 619 — 619 — Income (loss) from discontinued operations $ 462 $ (154 ) $ 173 $ (429 ) |
Fair Value of Assets and Liab23
Fair Value of Assets and Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets measured on a recurring and non-recurring basis at fair value, categorized by the level of inputs used in the valuation assets | The table below presents certain of our assets measured at fair value at September 30, 2017 , categorized by the level of inputs, as defined in the fair value hierarchy under GAAP, used in the valuation of each asset: Fair Value at Reporting Date Using Quoted Prices in Significant Estimated Active Markets for Significant Other Unobservable Fair Identical Assets Observable Inputs Inputs Description Value (Level 1) (Level 2) (Level 3) Recurring Fair Value Measurements Assets: Investment in RMR Inc. (1) $ 62,351 $ 62,351 $ — $ — Non-Recurring Fair Value Measurements Assets: One property (2) $ 1,885 $ — $ 1,885 $ — (1) Our 1,214,225 shares of class A common stock of The RMR Group Inc., or RMR Inc., which are included in other assets in our condensed consolidated balance sheets, are reported at fair value which is based on quoted market prices (Level 1 inputs as defined in the fair value hierarchy under GAAP). Our historical cost basis for these shares is $26,888 as of September 30, 2017 . The net unrealized gain of $35,463 for these shares as of September 30, 2017 is included in cumulative other comprehensive income in our condensed consolidated balance sheets. (2) We estimated the fair value of this property at September 30, 2017 based upon the selling price agreed to with a third party (Level 2 inputs as defined in the fair value hierarchy under GAAP). See Note 4 for further details. |
Schedule of fair value and carrying value of financial instruments | At September 30, 2017 and December 31, 2016 , the fair values of our financial instruments approximated their carrying values in our condensed consolidated financial statements due to their short term nature or variable interest rates, except as follows: As of September 30, 2017 As of December 31, 2016 Carrying Amount (1) Fair Value Carrying Amount (1) Fair Value Senior unsecured notes, 3.75% interest rate, due in 2019 $ 347,810 $ 357,625 $ 346,952 $ 354,078 Senior unsecured notes, 4.000% interest rate, due in 2022 295,587 302,655 — — Senior unsecured notes, 5.875% interest rate, due in 2046 300,146 325,500 299,892 292,268 Mortgage note payable, 5.88% interest rate, due in 2021 (2) 13,677 14,388 13,841 14,492 Mortgage note payable, 7.00% interest rate, due in 2019 (2) 8,490 8,739 8,778 9,188 Mortgage note payable, 8.15% interest rate, due in 2021 (2) 4,394 4,665 5,218 5,575 $ 970,104 $ 1,013,572 $ 674,681 $ 675,601 (1) Carrying amount includes certain unamortized debt issuance costs and unamortized premiums and discounts. (2) We assumed these mortgages in connection with our acquisitions of the encumbered properties. The stated interest rates for these mortgage debts are the contractually stated rates. We recorded the assumed mortgages at estimated fair value on the date of acquisition and we are amortizing the fair value premiums, if any, to interest expense over the respective terms of the mortgages to reduce interest expense to the estimated market interest rates as of the date of acquisition. |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Schedule of changes in each component of cumulative other comprehensive income (loss) | The following table presents changes in the amounts we recognized in cumulative other comprehensive income by component for the three and nine months ended September 30, 2017 : Three Months Ended September 30, 2017 Unrealized Gain Equity in on Investment Unrealized Gain in Available for of Sale Securities Investees Total Balance at June 30, 2017 $ 32,184 $ 10,166 $ 42,350 Other comprehensive income before reclassifications 3,279 1,355 4,634 Amounts reclassified from cumulative other comprehensive loss to net income (1) — (4 ) (4 ) Net current period other comprehensive income 3,279 1,351 4,630 Balance at September 30, 2017 $ 35,463 $ 11,517 $ 46,980 Nine Months Ended September 30, 2017 Unrealized Gain Equity in on Investment Unrealized Gain in Available for of Sale Securities Investees Total December 31, 2016 $ 21,074 $ 5,883 $ 26,957 Other comprehensive income before reclassifications 14,389 5,626 20,015 Amounts reclassified from cumulative other comprehensive income to net income (1) — 8 8 Net current period other comprehensive income 14,389 5,634 20,023 Balance at September 30, 2017 $ 35,463 $ 11,517 $ 46,980 (1) Amounts reclassified from cumulative other comprehensive income (loss) are included in equity in earnings of investees in our condensed consolidated statements of comprehensive income. |
Equity Investment in Select I25
Equity Investment in Select Income REIT (Tables) - SIR | 9 Months Ended |
Sep. 30, 2017 | |
Schedule Of Summarized Balance Sheet Information Of Equity Method Investee | Condensed Consolidated Balance Sheets September 30, December 31, 2017 2016 Real estate properties, net $ 3,922,568 $ 3,899,792 Acquired real estate leases, net 493,780 506,298 Properties held for sale 5,829 — Cash and cash equivalents 18,155 22,127 Rents receivable, net 122,292 124,089 Other assets, net 114,771 87,376 Total assets $ 4,677,395 $ 4,639,682 Unsecured revolving credit facility $ 102,000 $ 327,000 Unsecured term loan, net 348,746 348,373 Senior unsecured notes, net 1,776,087 1,430,300 Mortgage notes payable, net 227,772 245,643 Assumed real estate lease obligations, net 70,989 77,622 Other liabilities 129,502 136,782 Shareholders' equity 2,022,299 2,073,962 Total liabilities and shareholders' equity $ 4,677,395 $ 4,639,682 |
Schedule Of Summarized Income Statement Information Of Equity Method Investee | Condensed Consolidated Statements of Income Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Rental income $ 98,635 $ 96,037 $ 293,020 $ 290,512 Tenant reimbursements and other income 19,379 18,999 57,158 56,660 Total revenues 118,014 115,036 350,178 347,172 Real estate taxes 11,489 10,755 33,168 31,565 Other operating expenses 14,649 14,394 41,039 39,987 Depreciation and amortization 34,713 33,366 102,770 100,240 Acquisition related costs — 13 — 71 General and administrative 1,589 7,553 24,658 21,903 Write-off of straight line rents receivable, net — — 12,517 — Loss on asset impairment — — 4,047 — Loss on impairment of real estate assets — — 229 — Total expenses 62,440 66,081 218,428 193,766 Operating income 55,574 48,955 131,750 153,406 Dividend income 397 397 1,190 872 Interest expense (24,383 ) (20,690 ) (68,278 ) (61,883 ) Income before income tax expense and equity in earnings of an investee 31,588 28,662 64,662 92,395 Income tax expense (177 ) (107 ) (364 ) (370 ) Equity in earnings of an investee 31 13 533 107 Net income 31,442 28,568 64,831 92,132 Net income allocated to noncontrolling interest — — — (33 ) Net income attributed to SIR $ 31,442 $ 28,568 $ 64,831 $ 92,099 Weighted average common shares outstanding (basic) 89,355 89,308 89,341 89,295 Weighted average common shares outstanding (diluted) $ 89,379 $ 89,334 $ 89,364 $ 89,318 Net income attributed to SIR per common share (basic and diluted) $ 0.35 $ 0.32 $ 0.73 $ 1.03 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information | Three Months Ended September 30, 2017 Investment Investment in Real Estate in SIR Corporate Consolidated Rental income $ 70,179 $ — $ — $ 70,179 Expenses: Real estate taxes 8,862 — — 8,862 Utility expenses 5,408 — — 5,408 Other operating expenses 14,867 — — 14,867 Depreciation and amortization 20,781 — — 20,781 Loss on impairment of real estate 230 — — 230 General and administrative — — 3,266 3,266 Total expenses 50,148 — 3,266 53,414 Operating income (loss) 20,031 — (3,266 ) 16,765 Dividend income — — 304 304 Interest income 54 — 1,661 1,715 Interest expense (401 ) — (15,654 ) (16,055 ) Loss on early extinguishment of debt — (1,715 ) (1,715 ) Gain on issuance of shares by Select Income REIT — 51 — 51 Income (loss) from continuing operations before income taxes and equity in earnings of investees 19,684 51 (18,670 ) 1,065 Income tax expense — — (22 ) (22 ) Equity in earnings of investees — 9,453 31 9,484 Income (loss) from continuing operations 19,684 9,504 (18,661 ) 10,527 Income from discontinued operations 462 — — 462 Net income (loss) $ 20,146 $ 9,504 $ (18,661 ) $ 10,989 Nine Months Ended September 30, 2017 Investment Investment in Real Estate in SIR Corporate Consolidated Rental income $ 209,362 $ — $ — $ 209,362 Expenses: Real estate taxes 24,980 — — 24,980 Utility expenses 14,186 — — 14,186 Other operating expenses 44,046 — — 44,046 Depreciation and amortization 61,949 — — 61,949 Loss on impairment of real estate 230 — — 230 General and administrative — — 12,314 12,314 Total expenses 145,391 — 12,314 157,705 Operating income (loss) 63,971 — (12,314 ) 51,657 Dividend income — — 911 911 Interest income 148 — 1,695 1,843 Interest expense (1,238 ) — (42,361 ) (43,599 ) Loss on early extinguishment of debt (1,715 ) — — (1,715 ) Gain on issuance of shares by Select Income REIT — 72 — 72 Income (loss) from continuing operations before income taxes and equity in earnings of investees 61,166 72 (52,069 ) 9,169 Income tax expense — — (65 ) (65 ) Equity in earnings of investees — 20,271 533 20,804 Income (loss) from continuing operations 61,166 20,343 (51,601 ) 29,908 Income from discontinued operations 173 — — 173 Net income (loss) $ 61,339 $ 20,343 $ (51,601 ) $ 30,081 As of September 30, 2017 Investment Investment in Real Estate in SIR Corporate Consolidated Total Assets $ 1,780,753 $ 475,265 $ 1,280,949 $ 3,536,967 Three Months Ended September 30, 2016 Investment Investment in Real Estate in SIR Corporate Consolidated Rental income $ 64,478 $ — $ — $ 64,478 Expenses: Real estate taxes 7,591 — — 7,591 Utility expenses 5,483 — — 5,483 Other operating expenses 13,854 — — 13,854 Depreciation and amortization 18,404 — — 18,404 Acquisition related costs 147 — — 147 General and administrative — — 3,816 3,816 Total expenses 45,479 — 3,816 49,295 Operating income (loss) 18,999 — (3,816 ) 15,183 Dividend income — — 304 304 Interest income — — 47 47 Interest expense (429 ) — (12,179 ) (12,608 ) Gain on issuance of shares by Select Income REIT — 72 — 72 Income (loss) from continuing operations before income taxes and equity in earnings of investees 18,570 72 (15,644 ) 2,998 Income tax expense — — (13 ) (13 ) Equity in earnings of investees — 8,655 13 8,668 Income (loss) from continuing operations 18,570 8,727 (15,644 ) 11,653 Loss from discontinued operations (154 ) — — (154 ) Income (loss) before gain on sale of property 18,416 8,727 (15,644 ) 11,499 Gain on sale of property 79 — — 79 Net income (loss) $ 18,495 $ 8,727 $ (15,644 ) $ 11,578 Nine Months Ended September 30, 2016 Investment Investment in Real Estate in SIR Corporate Consolidated Rental income $ 192,150 $ — $ — $ 192,150 Expenses: Real estate taxes 22,810 — — 22,810 Utility expenses 13,330 — — 13,330 Other operating expenses 40,031 — — 40,031 Depreciation and amortization 54,713 — — 54,713 Acquisition related costs 363 — — 363 General and administrative — — 11,350 11,350 Total expenses 131,247 — 11,350 142,597 Operating income (loss) 60,903 — (11,350 ) 49,553 Dividend income — — 667 667 Interest income — — 63 63 Interest expense (1,953 ) — (30,333 ) (32,286 ) Gain on early extinguishment of debt 104 — — 104 Gain on issuance of shares by Select Income REIT — 88 — 88 Income (loss) from continuing operations before income taxes and equity in earnings of investees 59,054 88 (40,953 ) 18,189 Income tax expense — — (63 ) (63 ) Equity in earnings of investees — 27,895 107 28,002 Income (loss) from continuing operations 59,054 27,983 (40,909 ) 46,128 Loss from discontinued operations (429 ) — — (429 ) Income (loss) before gain on sale of property 58,625 27,983 (40,909 ) 45,699 Gain on sale of property 79 — — 79 Net income (loss) $ 58,704 $ 27,983 $ (40,909 ) $ 45,778 As of December 31, 2016 Investment Investment in Real Estate in SIR Corporate Consolidated Total Assets $ 1,807,560 $ 487,708 $ 89,798 $ 2,385,066 |
Recent Accounting Pronounceme27
Recent Accounting Pronouncements (Details) $ in Thousands | Sep. 30, 2017USD ($) |
Accounting Policies [Abstract] | |
Deferred gain on sale of real estate | $ 712 |
Weighted Average Common Share28
Weighted Average Common Shares (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Earnings Per Share, Basic and Diluted [Abstract] | ||||
Weighted average common shares for basic earnings per share (in shares) | 96,883 | 71,054 | 79,778 | 71,041 |
Effect of dilutive securities: unvested share awards (in shares) | 75 | 30 | 74 | 23 |
Weighted average common shares for diluted earnings per share (in shares) | 96,958 | 71,084 | 79,852 | 71,064 |
Real Estate Properties - Narrat
Real Estate Properties - Narrative (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2017USD ($)ft²leasepropertybuilding | Sep. 30, 2017USD ($)ft²leasepropertybuilding | Dec. 31, 2016USD ($) | |
Real Estate Properties [Line Items] | |||
Number of properties | property | 74 | 74 | |
Number of buildings | building | 96 | 96 | |
Carrying value of real estate properties | $ 1,929,711 | $ 1,929,711 | $ 1,888,760 |
Number of leases entered | lease | 14 | 42 | |
Rentable square feet (in feet) | ft² | 436,102 | 1,084,633 | |
Weighted average lease term | 8 years 4 months 24 days | 8 years 9 months 18 days | |
Expenditures committed on leases | $ 7,902 | $ 12,609 | |
Committed but unspent tenant related obligations estimated | $ 26,631 | 26,631 | |
Square foot expansion cost | 3,302 | ||
Interest costs capitalized | $ 328 | ||
Continuing operations | |||
Real Estate Properties [Line Items] | |||
Number of properties | property | 74 | 74 | |
Number of buildings | building | 96 | 96 | |
Carrying value of real estate properties | $ 1,929,711 | $ 1,929,711 |
Real Estate Properties - Acquis
Real Estate Properties - Acquisition Activities (Details) $ in Thousands | Oct. 02, 2017USD ($)ft²propertyjoint_venturebuilding | Sep. 30, 2017USD ($)ft²property | Jan. 31, 2017USD ($)ft²propertybuilding | Sep. 30, 2017USD ($)ft²propertybuilding | Sep. 30, 2016USD ($) |
Real Estate Properties [Line Items] | |||||
Purchase price | $ 666,202 | $ 83,705 | |||
Manassas, VA | |||||
Real Estate Properties [Line Items] | |||||
Number of properties | property | 1 | 1 | 1 | ||
Number of buildings acquired | building | 1 | 1 | |||
Rentable square feet of properties (in square feet) | ft² | 69,374 | 69,374 | 69,374 | ||
Percentage of property leased | 100.00% | ||||
Purchase price | $ 12,657 | $ 12,657 | |||
Capitalized acquisition costs | $ 37 | $ 37 | |||
Land | 1,562 | ||||
Buildings and Improvement | 8,253 | ||||
Other assumed assets | $ 2,842 | ||||
Transferable Development Rights | Washington D.C. | |||||
Real Estate Properties [Line Items] | |||||
Consideration transferred | $ 2,030 | ||||
Subsequent Event | First Potomac Realty Trust | |||||
Real Estate Properties [Line Items] | |||||
Number of properties | property | 39 | ||||
Number of buildings acquired | building | 74 | ||||
Rentable square feet of properties (in square feet) | ft² | 6,454,382 | ||||
Consideration transferred | $ 1,374,624 | ||||
Number of joint ventures | joint_venture | 2 | ||||
Cash consideration paid | $ 651,696 | ||||
Expected repayment of debt | $ 483,000 | ||||
Subsequent Event | First Potomac Realty Trust | |||||
Real Estate Properties [Line Items] | |||||
Number of joint ventures | joint_venture | 2 | ||||
Subsequent Event | Joint Venture Property 1 | First Potomac Realty Trust | |||||
Real Estate Properties [Line Items] | |||||
Ownership percentage | 50.00% | ||||
Subsequent Event | Joint Venture Property 2 | First Potomac Realty Trust | |||||
Real Estate Properties [Line Items] | |||||
Ownership percentage | 51.00% | ||||
FPO Mortgage | Mortgage | Subsequent Event | First Potomac Realty Trust | |||||
Real Estate Properties [Line Items] | |||||
Mortgage debt assumed | $ 167,549 | ||||
Joint Venture Mortgage | Mortgage | Subsequent Event | First Potomac Realty Trust | |||||
Real Estate Properties [Line Items] | |||||
Mortgage debt assumed | $ 82,000 |
Real Estate Properties - Pro Fo
Real Estate Properties - Pro Forma (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||
Rental income | $ 328,255 | $ 311,167 |
Net (loss) income | $ (4,733) | $ 19,411 |
Net (loss) income per share (in dollars per share) | $ (0.05) | $ 0.20 |
Acquisition-related costs | ||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||
Decrease in rental income | $ 804 | $ 8,330 |
Decrease (Increase) in net income | $ 47,019 | $ (2,458) |
Real Estate Properties - Dispos
Real Estate Properties - Disposition Activities (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||
Aug. 31, 2017USD ($)ft²propertybuilding | Sep. 30, 2017USD ($)propertybuilding | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)propertybuilding | Sep. 30, 2016USD ($) | Oct. 05, 2017USD ($)ft²propertybuilding | Dec. 31, 2016USD ($) | |
Real Estate Properties [Line Items] | |||||||
Number of properties | property | 74 | 74 | |||||
Number of buildings | building | 96 | 96 | |||||
Net book value | $ 1,598,642 | $ 1,598,642 | $ 1,591,956 | ||||
Loss on impairment of real estate | 230 | $ 0 | 230 | $ 0 | |||
Discontinued Operations, Held-for-sale | One building | Albuquerque, NM | Office Building | |||||||
Real Estate Properties [Line Items] | |||||||
Aggregate sale price of properties sold, excluding closing costs | $ 2,000 | ||||||
Loss on impairment of real estate | 230 | ||||||
Discontinued operations | One building | Falls Church, VA | Office Building | |||||||
Real Estate Properties [Line Items] | |||||||
Number of properties | property | 1 | ||||||
Number of buildings | building | 1 | ||||||
Rentable square feet of properties (in square feet) | ft² | 164,746 | ||||||
Net book value | $ 12,901 | ||||||
Aggregate sale price of properties sold, excluding closing costs | $ 13,523 | ||||||
Increase in carrying value of property included in discontinued operations | $ (619) | ||||||
Subsequent Event | Discontinued Operations, Held-for-sale | One building | Albuquerque, NM | Office Building | |||||||
Real Estate Properties [Line Items] | |||||||
Number of properties | property | 1 | ||||||
Number of buildings | building | 1 | ||||||
Rentable square feet of properties (in square feet) | ft² | 29,045 | ||||||
Net book value | $ 1,885 |
Real Estate Properties - Balanc
Real Estate Properties - Balance Sheet Information for Disposal of Property (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Assets of discontinued operations | $ 0 | $ 12,541 |
Liabilities of discontinued operations | 0 | 45 |
Discontinued Operations, Held-for-sale | Discontinued operations | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Real estate properties, net | 0 | 12,260 |
Other assets | 0 | 281 |
Assets of discontinued operations | 0 | 12,541 |
Other liabilities | 0 | 45 |
Liabilities of discontinued operations | $ 0 | $ 45 |
Real Estate Properties - Income
Real Estate Properties - Income Statement Information for Disposal of Property (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Income (loss) from discontinued operations | $ 462 | $ (154) | $ 173 | $ (429) |
Discontinued Operations, Held-for-sale | Discontinued operations | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Rental income | 4 | 6 | 17 | 62 |
Real estate taxes | (40) | (27) | (88) | (73) |
Utility expenses | (17) | (34) | (97) | (113) |
Other operating expenses | (87) | (70) | (202) | (219) |
General and administrative | (17) | (29) | (76) | (86) |
Increase in carrying value of property | 619 | 0 | 619 | 0 |
Income (loss) from discontinued operations | $ 462 | $ (154) | $ 173 | $ (429) |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Revenue Recognition [Abstract] | |||||
Increase in rental income to record revenue on straight line basis | $ 711 | $ 1,205 | $ 3,115 | $ 1,789 | |
Straight line rent receivables | 24,801 | 24,801 | $ 21,686 | ||
Allowance for doubtful accounts | $ 132 | $ 132 | $ 155 |
Concentration (Details)
Concentration (Details) | 9 Months Ended | |
Sep. 30, 2017propertygovernment_tenantstate_governmentstatebuilding | Sep. 30, 2016 | |
Concentration | ||
Number of state governments | state_government | 13 | |
Number of other governments | government_tenant | 4 | |
Number of properties | property | 74 | |
Number of buildings | building | 96 | |
Number of states in which acquired properties located | state | 31 | |
Annualized rental income, excluding properties classified as discontinued operations | Virginia | ||
Concentration | ||
Annualized Rental income percent | 14.80% | |
Annualized rental income, excluding properties classified as discontinued operations | California | ||
Concentration | ||
Annualized Rental income percent | 14.80% | |
Annualized rental income, excluding properties classified as discontinued operations | District of Columbia | ||
Concentration | ||
Annualized Rental income percent | 9.50% | |
Annualized rental income, excluding properties classified as discontinued operations | Georgia | ||
Concentration | ||
Annualized Rental income percent | 8.60% | |
Annualized rental income, excluding properties classified as discontinued operations | Maryland | ||
Concentration | ||
Annualized Rental income percent | 7.00% | |
Annualized rental income, excluding properties classified as discontinued operations | New York | ||
Concentration | ||
Annualized Rental income percent | 6.90% | |
Annualized rental income, excluding properties classified as discontinued operations | Massachusetts | ||
Concentration | ||
Annualized Rental income percent | 4.90% | |
Annualized rental income, excluding properties classified as discontinued operations | Tenant concentration | U.S. Government, state governments and Other Three Government | ||
Concentration | ||
Concentration risk percentage | 87.50% | 92.40% |
Annualized rental income, excluding properties classified as discontinued operations | Tenant concentration | U.S. Government | ||
Concentration | ||
Concentration risk percentage | 59.80% | 63.90% |
Indebtedness - Debt Obligations
Indebtedness - Debt Obligations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Oct. 30, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||||||
Borrowings outstanding | $ 565,000 | $ 565,000 | $ 160,000 | |||
Maximum borrowing capacity on revolving credit facility | 2,500,000 | 2,500,000 | ||||
Aggregate principal amount on secured properties | 26,358 | 26,358 | ||||
Unsecured term loan, due in 2020 | ||||||
Debt Instrument [Line Items] | ||||||
Face amount | $ 300,000 | $ 300,000 | ||||
Interest rate (as a percent) | 2.60% | 2.60% | ||||
The weighted average annual interest rate (as a percent) | 2.60% | 1.90% | 2.40% | 1.90% | ||
Unsecured term loan, due in 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Face amount | $ 250,000 | $ 250,000 | ||||
Interest rate (as a percent) | 3.00% | 3.00% | ||||
The weighted average annual interest rate (as a percent) | 3.00% | 2.30% | 2.80% | 2.30% | ||
Unsecured revolving credit facility | ||||||
Debt Instrument [Line Items] | ||||||
Borrowings outstanding | $ 565,000 | $ 565,000 | ||||
Maximum borrowing capacity on revolving credit facility | $ 750,000 | $ 750,000 | ||||
Option to extend the maturity date subject to certain conditions and the payment of a fee | 1 year | |||||
Facility fee (as a percent) | 0.25% | |||||
Interest rate (as a percent) | 2.40% | 2.40% | ||||
The weighted average annual interest rate (as a percent) | 2.40% | 1.70% | 2.20% | 1.70% | ||
Unsecured revolving credit facility | Subsequent Event | ||||||
Debt Instrument [Line Items] | ||||||
Borrowings outstanding | $ 545,000 | |||||
Term loans | ||||||
Debt Instrument [Line Items] | ||||||
Face amount | $ 550,000 | $ 550,000 | ||||
Senior unsecured notes | ||||||
Debt Instrument [Line Items] | ||||||
Face amount | $ 960,000 | $ 960,000 | ||||
LIBOR | Unsecured term loan, due in 2020 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate premium (as a percent) | 1.40% | |||||
LIBOR | Unsecured term loan, due in 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate premium (as a percent) | 1.80% | |||||
LIBOR | Unsecured revolving credit facility | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate premium (as a percent) | 1.25% |
Indebtedness - Additional Infor
Indebtedness - Additional Information (Details) $ in Thousands | Oct. 02, 2017mortgage_notepropertyloanjoint_venturebuilding | Jul. 20, 2017USD ($) | Sep. 30, 2017USD ($)propertybuilding | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)propertyloanbuilding | Sep. 30, 2016USD ($) |
Debt Instrument [Line Items] | ||||||
Loss on extinguishment of debt | $ 1,715 | $ 0 | $ 1,715 | $ (104) | ||
Number of properties secured by mortgage notes | property | 3 | 3 | ||||
Number of buildings secured by mortgage notes | building | 3 | 3 | ||||
Aggregate net book value of secured properties | $ 50,031 | $ 50,031 | ||||
Number of assumed secured mortgage loans | loan | 3 | |||||
Aggregate principal amount on secured properties | $ 26,358 | $ 26,358 | ||||
Senior unsecured notes, 4.000% interest rate, due in 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate (as a percent) | 4.00% | 4.00% | ||||
Senior unsecured notes | Senior unsecured notes, 4.000% interest rate, due in 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Face amount | $ 300,000 | |||||
Interest rate (as a percent) | 4.00% | |||||
Proceeds from issuance of debt | $ 295,403 | |||||
Commitment Letter | ||||||
Debt Instrument [Line Items] | ||||||
Loss on extinguishment of debt | 1,715 | |||||
Commitment Letter | Bridge Loan Facility | ||||||
Debt Instrument [Line Items] | ||||||
Face amount | $ 750,000 | |||||
Term of debt instrument | 364 days | |||||
First Potomac Realty Trust | Subsequent Event | ||||||
Debt Instrument [Line Items] | ||||||
Number of properties secured by mortgage notes | property | 5 | |||||
Number of buildings secured by mortgage notes | building | 5 | |||||
Number of assumed secured mortgage loans | loan | 5 | |||||
Number mortgage notes securing joint ventures | mortgage_note | 2 | |||||
Number of joint ventures | joint_venture | 2 | |||||
First Potomac Realty Trust | Subsequent Event | ||||||
Debt Instrument [Line Items] | ||||||
Number of joint ventures | joint_venture | 2 | |||||
First Potomac Realty Trust | Joint Venture Property 1 | Subsequent Event | ||||||
Debt Instrument [Line Items] | ||||||
Ownership percentage | 50.00% | |||||
First Potomac Realty Trust | Joint Venture Property 2 | Subsequent Event | ||||||
Debt Instrument [Line Items] | ||||||
Ownership percentage | 51.00% |
Fair Value of Assets and Liab39
Fair Value of Assets and Liabilities - Recurring and Nonrecurring Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Fair Value of Assets and Liabilities | ||||
Common shares owned in RMR Inc. (in shares) | 1,214,225 | 1,214,225 | ||
Historical cost | $ 26,888 | $ 26,888 | ||
Unrealized gain on investment in available for sale securities | 3,279 | $ 8,463 | 14,389 | $ 28,571 |
Recurring | ||||
Fair Value of Assets and Liabilities | ||||
Investment in RMR Inc. | 62,351 | 62,351 | ||
Recurring | Level 1 inputs | ||||
Fair Value of Assets and Liabilities | ||||
Investment in RMR Inc. | 62,351 | 62,351 | ||
Recurring | Level 2 inputs | ||||
Fair Value of Assets and Liabilities | ||||
Investment in RMR Inc. | 0 | 0 | ||
Recurring | Level 3 inputs | ||||
Fair Value of Assets and Liabilities | ||||
Investment in RMR Inc. | 0 | 0 | ||
Nonrecurring | Discontinued Operations, Held-for-sale | ||||
Fair Value of Assets and Liabilities | ||||
One property | 1,885 | 1,885 | ||
Nonrecurring | Level 1 inputs | Discontinued Operations, Held-for-sale | ||||
Fair Value of Assets and Liabilities | ||||
One property | 0 | 0 | ||
Nonrecurring | Level 2 inputs | Discontinued Operations, Held-for-sale | ||||
Fair Value of Assets and Liabilities | ||||
One property | 1,885 | 1,885 | ||
Nonrecurring | Level 3 inputs | Discontinued Operations, Held-for-sale | ||||
Fair Value of Assets and Liabilities | ||||
One property | $ 0 | 0 | ||
Other Comprehensive Income (Loss) | ||||
Fair Value of Assets and Liabilities | ||||
Unrealized gain on investment in available for sale securities | $ 35,463 |
Fair Value of Assets and Liab40
Fair Value of Assets and Liabilities - Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Fair Value of Financial Instruments | ||
Senior Notes | $ 943,543 | $ 646,844 |
Mortgage notes payable, net | $ 26,561 | 27,837 |
Senior unsecured notes, 3.75% interest rate, due in 2019 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 3.75% | |
Senior unsecured notes, 4.000% interest rate, due in 2022 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 4.00% | |
Senior unsecured notes, 5.875% interest rate, due in 2046 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 5.875% | |
Mortgage note payable, 5.88% interest rate, due in 2021 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 5.88% | |
Mortgage note payable, 7.00% interest rate, due in 2019 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 7.00% | |
Mortgage note payable, 8.15% interest rate, due in 2021 | ||
Fair Value of Financial Instruments | ||
Interest rate (as a percent) | 8.15% | |
Carrying Amount | ||
Fair Value of Financial Instruments | ||
Mortgage notes payable, net | $ 970,104 | 674,681 |
Carrying Amount | Senior unsecured notes, 3.75% interest rate, due in 2019 | ||
Fair Value of Financial Instruments | ||
Senior Notes | 347,810 | 346,952 |
Carrying Amount | Senior unsecured notes, 4.000% interest rate, due in 2022 | ||
Fair Value of Financial Instruments | ||
Senior Notes | 295,587 | 0 |
Carrying Amount | Senior unsecured notes, 5.875% interest rate, due in 2046 | ||
Fair Value of Financial Instruments | ||
Senior Notes | 300,146 | 299,892 |
Carrying Amount | Mortgage note payable, 5.88% interest rate, due in 2021 | ||
Fair Value of Financial Instruments | ||
Mortgage notes payable, net | 13,677 | 13,841 |
Carrying Amount | Mortgage note payable, 7.00% interest rate, due in 2019 | ||
Fair Value of Financial Instruments | ||
Mortgage notes payable, net | 8,490 | 8,778 |
Carrying Amount | Mortgage note payable, 8.15% interest rate, due in 2021 | ||
Fair Value of Financial Instruments | ||
Mortgage notes payable, net | 4,394 | 5,218 |
Fair Value | ||
Fair Value of Financial Instruments | ||
Mortgage notes payable, net | 1,013,572 | 675,601 |
Fair Value | Senior unsecured notes, 3.75% interest rate, due in 2019 | ||
Fair Value of Financial Instruments | ||
Senior Notes | 357,625 | 354,078 |
Fair Value | Senior unsecured notes, 4.000% interest rate, due in 2022 | ||
Fair Value of Financial Instruments | ||
Senior Notes | 302,655 | 0 |
Fair Value | Senior unsecured notes, 5.875% interest rate, due in 2046 | ||
Fair Value of Financial Instruments | ||
Senior Notes | 325,500 | 292,268 |
Fair Value | Mortgage note payable, 5.88% interest rate, due in 2021 | ||
Fair Value of Financial Instruments | ||
Mortgage notes payable, net | 14,388 | 14,492 |
Fair Value | Mortgage note payable, 7.00% interest rate, due in 2019 | ||
Fair Value of Financial Instruments | ||
Mortgage notes payable, net | 8,739 | 9,188 |
Fair Value | Mortgage note payable, 8.15% interest rate, due in 2021 | ||
Fair Value of Financial Instruments | ||
Mortgage notes payable, net | $ 4,665 | $ 5,575 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Details) $ / shares in Units, $ in Thousands | Oct. 12, 2017USD ($)$ / shares | Sep. 19, 2017$ / sharesshares | Sep. 14, 2017$ / sharesshares | Aug. 21, 2017USD ($)$ / shares | Aug. 03, 2017USD ($)$ / sharesshares | Jul. 05, 2017$ / sharesshares | Jun. 30, 2017$ / sharesshares | May 22, 2017USD ($)$ / shares | May 17, 2017USD ($)trustee$ / sharesshares | Feb. 23, 2017USD ($)$ / shares | Sep. 30, 2017shares | Sep. 30, 2016shares |
Distributions | ||||||||||||
Cash distribution to common shareholders (in dollars per share) | $ 0.43 | $ 0.43 | $ 0.43 | |||||||||
Distribution paid to common shareholders | $ | $ 41,364 | $ 30,606 | $ 30,606 | |||||||||
Proceeds from offering | $ | $ 493,936 | |||||||||||
Number of trustees | trustee | 6 | |||||||||||
Shares withheld for tax withholding (in shares) | shares | 450 | |||||||||||
Value of shares withheld for tax withholding | $ | $ 10 | |||||||||||
Subsequent Event | ||||||||||||
Distributions | ||||||||||||
Distribution paid to common shareholders | $ | $ 42,633 | |||||||||||
Distribution payable to common shareholders (in dollars per share) | $ 0.43 | |||||||||||
Common shares | Trustees | ||||||||||||
Distributions | ||||||||||||
Common shares granted (in shares) | shares | 3,000 | |||||||||||
Value of shares granted (in dollars per share) | $ 21.75 | |||||||||||
Common shares | Officers and certain employees | ||||||||||||
Distributions | ||||||||||||
Common shares granted (in shares) | shares | 57,350 | |||||||||||
Value of shares granted (in dollars per share) | $ 18.61 | |||||||||||
Underwritten Public Offering | ||||||||||||
Distributions | ||||||||||||
Number of shares sold in offering (in shares) | shares | 25,000,000 | |||||||||||
Price per share in offering (in dollars per share) | $ 18.50 | |||||||||||
Over-Allotment Option | ||||||||||||
Distributions | ||||||||||||
Number of shares sold in offering (in shares) | shares | 2,907,029 | |||||||||||
Price per share in offering (in dollars per share) | $ 18.50 | |||||||||||
Former Employee of RMR LLC | ||||||||||||
Distributions | ||||||||||||
Stock repurchased to satisfy tax withholding obligation (in shares) | shares | 13,636 | 278 | 13,636 | 13,209 | ||||||||
Stock repurchased to satisfy tax withholding obligation (in dollars per share) | $ 18.30 | $ 18.31 |
Shareholders' Equity - AOCI Rol
Shareholders' Equity - AOCI Roll Forward (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 935,004 | |||
Other comprehensive income | $ 4,630 | $ 11,736 | 20,023 | $ 38,994 |
Ending balance | 1,377,527 | 1,377,527 | ||
Unrealized Gain on Investment in Available for Sale Securities | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | 32,184 | 21,074 | ||
Other comprehensive income before reclassifications | 3,279 | 14,389 | ||
Amounts reclassified from cumulative other comprehensive income to net income | 0 | 0 | ||
Other comprehensive income | 3,279 | 14,389 | ||
Ending balance | 35,463 | 35,463 | ||
Equity in Unrealized Gain of an Investee | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | 10,166 | 5,883 | ||
Other comprehensive income before reclassifications | 1,355 | 5,626 | ||
Amounts reclassified from cumulative other comprehensive income to net income | (4) | 8 | ||
Other comprehensive income | 1,351 | 5,634 | ||
Ending balance | 11,517 | 11,517 | ||
Total | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | 42,350 | 26,957 | ||
Other comprehensive income before reclassifications | 4,634 | 20,015 | ||
Amounts reclassified from cumulative other comprehensive income to net income | (4) | 8 | ||
Other comprehensive income | 4,630 | 20,023 | ||
Ending balance | $ 46,980 | $ 46,980 |
Business and Property Managem43
Business and Property Management Agreements with RMR LLC (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)employeeagreement | Sep. 30, 2016USD ($) | |
RMR LLC | ||||
Related Party Transaction [Line Items] | ||||
Number of employees | employee | 0 | |||
Number of agreements | agreement | 2 | |||
Related party expense | $ 1,891 | $ 2,572 | $ 8,241 | $ 7,614 |
Reimbursement expense | 3,436 | 3,221 | 10,482 | 9,132 |
Internal audit costs | 67 | 34 | 202 | 168 |
Net Property Management and Construction Supervision Fees | RMR LLC | ||||
Related Party Transaction [Line Items] | ||||
Related party transaction amount | 2,338 | $ 2,249 | $ 7,371 | $ 6,636 |
RMR LLC | Affiliated Entity | ||||
Related Party Transaction [Line Items] | ||||
Reversal of expense with related party | $ 893 | |||
RMR LLC | Business Management Agreement, Incentive Fees | Affiliated Entity | ||||
Related Party Transaction [Line Items] | ||||
Period of common share total return, incentive fees payable | 3 years |
Related Person Transactions - R
Related Person Transactions - REITs, for which RMR LLC provides Management Services (Details) - USD ($) $ in Thousands | Sep. 19, 2017 | Jun. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Dec. 31, 2016 |
SIR | ||||||
Related Party Transaction [Line Items] | ||||||
Shares holding (in shares) | 24,918,421 | |||||
Percentage of outstanding shares owned | 27.80% | 27.80% | ||||
RMR Inc | Class A common shares | ||||||
Related Party Transaction [Line Items] | ||||||
Shares holding (in shares) | 1,214,225 | |||||
Former Employee of RMR LLC | ||||||
Related Party Transaction [Line Items] | ||||||
Stock repurchased to satisfy tax withholding obligation (in shares) | 13,636 | 278 | 13,636 | 13,209 | ||
AIC | ||||||
Related Party Transaction [Line Items] | ||||||
Carrying value of equity method investments | $ 8,064 | $ 8,064 | $ 7,235 | |||
Officers and Other Employees | Common shares | ||||||
Related Party Transaction [Line Items] | ||||||
Common shares granted (in shares) | 57,350 | 53,400 | ||||
Property Insurance Premium Expense | AIC | ||||||
Related Party Transaction [Line Items] | ||||||
Property insurance premiums paid | $ 757 |
Equity Investment in Select I45
Equity Investment in Select Income REIT - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Schedule of Equity Method Investments [Line Items] | |||||
Equity in earnings of investees | $ 9,484 | $ 8,668 | $ 20,804 | $ 28,002 | |
Investment at carrying value | $ 475,265 | 475,265 | $ 487,708 | ||
Cash distributions from SIR | $ 18,062 | 25,676 | |||
SIR | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Equity investments, common shares owned (in shares) | 24,918,421 | 24,918,421 | |||
Percentage of outstanding shares owned | 27.80% | 27.80% | |||
Equity in earnings of investees | $ 9,453 | 8,655 | $ 20,271 | 27,895 | |
Equity in unrealized gain (loss) of investees | 1,236 | 3,192 | 5,339 | 10,248 | |
The amount of investment in exceed the underlying equity of the investee | 87,976 | 87,976 | |||
Accretion in equity of earnings | 736 | 740 | 2,209 | 2,219 | |
Investment at carrying value | 475,265 | 475,265 | |||
Equity Investments, market value | 583,589 | 583,589 | |||
Cash distributions from SIR | $ 12,708 | $ 12,708 | $ 38,125 | $ 37,627 |
Equity Investment in Select I46
Equity Investment in Select Income REIT - Balance Sheet Information (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Dec. 31, 2015 |
Schedule of Equity Method Investments [Line Items] | ||||
Real estate properties, net | $ 1,598,642 | $ 1,591,956 | ||
Acquired real estate leases, net | 99,953 | 124,848 | ||
Cash and cash equivalents | 551,707 | 29,941 | $ 13,749 | $ 8,785 |
Rents receivable, net | 47,461 | 48,458 | ||
Other assets, net | 89,484 | 68,005 | ||
Total assets | 3,536,967 | 2,385,066 | ||
Unsecured revolving credit facility | 565,000 | 160,000 | ||
Unsecured term loan, net | 547,682 | 547,171 | ||
Senior unsecured notes, net | 943,543 | 646,844 | ||
Mortgage notes payable, net | 26,561 | 27,837 | ||
Assumed real estate lease obligations, net | 8,832 | 10,626 | ||
Other liabilities | 63,525 | 54,019 | ||
Shareholders' equity | 1,377,527 | 935,004 | ||
Total liabilities and shareholders’ equity | 3,536,967 | 2,385,066 | ||
SIR | SIR | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Real estate properties, net | 3,922,568 | 3,899,792 | ||
Acquired real estate leases, net | 493,780 | 506,298 | ||
Properties held for sale | 5,829 | 0 | ||
Cash and cash equivalents | 18,155 | 22,127 | ||
Rents receivable, net | 122,292 | 124,089 | ||
Other assets, net | 114,771 | 87,376 | ||
Total assets | 4,677,395 | 4,639,682 | ||
Unsecured revolving credit facility | 102,000 | 327,000 | ||
Unsecured term loan, net | 348,746 | 348,373 | ||
Senior unsecured notes, net | 1,776,087 | 1,430,300 | ||
Mortgage notes payable, net | 227,772 | 245,643 | ||
Assumed real estate lease obligations, net | 70,989 | 77,622 | ||
Other liabilities | 129,502 | 136,782 | ||
Shareholders' equity | 2,022,299 | 2,073,962 | ||
Total liabilities and shareholders’ equity | $ 4,677,395 | $ 4,639,682 |
Equity Investment in Select I47
Equity Investment in Select Income REIT - Income Statement Information (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Schedule of Equity Method Investments [Line Items] | ||||
Total revenues | $ 70,179 | $ 64,478 | $ 209,362 | $ 192,150 |
Real estate taxes | 8,862 | 7,591 | 24,980 | 22,810 |
Other operating expenses | 14,867 | 13,854 | 44,046 | 40,031 |
Depreciation and amortization | 20,781 | 18,404 | 61,949 | 54,713 |
Acquisition related costs | 0 | 147 | 0 | 363 |
General and administrative | 3,266 | 3,816 | 12,314 | 11,350 |
Loss on impairment of real estate assets | 230 | 0 | 230 | 0 |
Total expenses | 53,414 | 49,295 | 157,705 | 142,597 |
Operating income | 16,765 | 15,183 | 51,657 | 49,553 |
Dividend income | 304 | 304 | 911 | 667 |
Interest expense | (16,055) | (12,608) | (43,599) | (32,286) |
Income (loss) from continuing operations before income taxes and equity in earnings of investees | 1,065 | 2,998 | 9,169 | 18,189 |
Income tax expense | (22) | (13) | (65) | (63) |
Equity in earnings of an investee | $ 9,484 | $ 8,668 | $ 20,804 | $ 28,002 |
Weighted average common shares outstanding (basic) (in shares) | 96,883 | 71,054 | 79,778 | 71,041 |
Weighted average common shares outstanding (diluted) (in shares) | 96,958 | 71,084 | 79,852 | 71,064 |
Net income attributed to SIR per common share (basic and diluted) (in dollars per share) | $ 0.11 | $ 0.16 | $ 0.38 | $ 0.64 |
SIR | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Equity in earnings of an investee | $ 9,453 | $ 8,655 | $ 20,271 | $ 27,895 |
SIR | SIR | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Rental income | 98,635 | 96,037 | 293,020 | 290,512 |
Tenant reimbursements and other income | 19,379 | 18,999 | 57,158 | 56,660 |
Total revenues | 118,014 | 115,036 | 350,178 | 347,172 |
Real estate taxes | 11,489 | 10,755 | 33,168 | 31,565 |
Other operating expenses | 14,649 | 14,394 | 41,039 | 39,987 |
Depreciation and amortization | 34,713 | 33,366 | 102,770 | 100,240 |
Acquisition related costs | 0 | 13 | 0 | 71 |
General and administrative | 1,589 | 7,553 | 24,658 | 21,903 |
Write-off of straight line rents receivable, net | 0 | 0 | 12,517 | 0 |
Loss on asset impairment | 0 | 0 | 4,047 | 0 |
Loss on impairment of real estate assets | 0 | 0 | 229 | 0 |
Total expenses | 62,440 | 66,081 | 218,428 | 193,766 |
Operating income | 55,574 | 48,955 | 131,750 | 153,406 |
Dividend income | 397 | 397 | 1,190 | 872 |
Interest expense | (24,383) | (20,690) | (68,278) | (61,883) |
Income (loss) from continuing operations before income taxes and equity in earnings of investees | 31,588 | 28,662 | 64,662 | 92,395 |
Income tax expense | (177) | (107) | (364) | (370) |
Equity in earnings of an investee | 31 | 13 | 533 | 107 |
Net income | 31,442 | 28,568 | 64,831 | 92,132 |
Net income allocated to noncontrolling interest | 0 | 0 | 0 | (33) |
Net income attributed to SIR | $ 31,442 | $ 28,568 | $ 64,831 | $ 92,099 |
Weighted average common shares outstanding (basic) (in shares) | 89,355 | 89,308 | 89,341 | 89,295 |
Weighted average common shares outstanding (diluted) (in shares) | 89,379 | 89,334 | 89,364 | 89,318 |
Net income attributed to SIR per common share (basic and diluted) (in dollars per share) | $ 0.35 | $ 0.32 | $ 0.73 | $ 1.03 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)segment | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | |
Segment Reporting Information [Line Items] | |||||
Number of segments | segment | 2 | ||||
Rental income | $ 70,179 | $ 64,478 | $ 209,362 | $ 192,150 | |
Expenses: | |||||
Real estate taxes | 8,862 | 7,591 | 24,980 | 22,810 | |
Utility expenses | 5,408 | 5,483 | 14,186 | 13,330 | |
Other operating expenses | 14,867 | 13,854 | 44,046 | 40,031 | |
Depreciation and amortization | 20,781 | 18,404 | 61,949 | 54,713 | |
Loss on impairment of real estate | 230 | 0 | 230 | 0 | |
Acquisition related costs | 0 | 147 | 0 | 363 | |
General and administrative | 3,266 | 3,816 | 12,314 | 11,350 | |
Total expenses | 53,414 | 49,295 | 157,705 | 142,597 | |
Operating income | 16,765 | 15,183 | 51,657 | 49,553 | |
Dividend income | 304 | 304 | 911 | 667 | |
Interest income | 1,715 | 47 | 1,843 | 63 | |
Interest expense | (16,055) | (12,608) | (43,599) | (32,286) | |
(Loss) gain on early extinguishment of debt | (1,715) | 0 | (1,715) | 104 | |
Gain on issuance of shares by Select Income REIT | 51 | 72 | 72 | 88 | |
Income (loss) from continuing operations before income taxes and equity in earnings of investees | 1,065 | 2,998 | 9,169 | 18,189 | |
Income tax expense | (22) | (13) | (65) | (63) | |
Equity in earnings of investees | 9,484 | 8,668 | 20,804 | 28,002 | |
Income from continuing operations | 10,527 | 11,653 | 29,908 | 46,128 | |
Income (loss) from discontinued operations | 462 | (154) | 173 | (429) | |
Income (loss) before gain on sale of property | 10,989 | 11,499 | 30,081 | 45,699 | |
Gain on sale of property | 0 | 79 | 0 | 79 | |
Net income | 10,989 | 11,578 | 30,081 | 45,778 | |
Total assets | 3,536,967 | 3,536,967 | $ 2,385,066 | ||
Operating Segments | Investment in Real Estate | |||||
Segment Reporting Information [Line Items] | |||||
Rental income | 70,179 | 64,478 | 209,362 | 192,150 | |
Expenses: | |||||
Real estate taxes | 8,862 | 7,591 | 24,980 | 22,810 | |
Utility expenses | 5,408 | 5,483 | 14,186 | 13,330 | |
Other operating expenses | 14,867 | 13,854 | 44,046 | 40,031 | |
Depreciation and amortization | 20,781 | 18,404 | 61,949 | 54,713 | |
Loss on impairment of real estate | 230 | 230 | |||
Acquisition related costs | 147 | 363 | |||
Total expenses | 50,148 | 45,479 | 145,391 | 131,247 | |
Operating income | 20,031 | 18,999 | 63,971 | 60,903 | |
Interest income | 54 | 148 | 0 | ||
Interest expense | (401) | (429) | (1,238) | (1,953) | |
(Loss) gain on early extinguishment of debt | (1,715) | 104 | |||
Income (loss) from continuing operations before income taxes and equity in earnings of investees | 19,684 | 18,570 | 61,166 | 59,054 | |
Income from continuing operations | 19,684 | 18,570 | 61,166 | 59,054 | |
Income (loss) from discontinued operations | 462 | (154) | 173 | (429) | |
Income (loss) before gain on sale of property | 18,416 | 58,625 | |||
Gain on sale of property | 79 | 79 | |||
Net income | 20,146 | 18,495 | 61,339 | 58,704 | |
Total assets | 1,780,753 | 1,780,753 | 1,807,560 | ||
Operating Segments | Investment in SIR | |||||
Expenses: | |||||
Gain on issuance of shares by Select Income REIT | 51 | 72 | 72 | 88 | |
Income (loss) from continuing operations before income taxes and equity in earnings of investees | 51 | 72 | 72 | 88 | |
Equity in earnings of investees | 9,453 | 8,655 | 20,271 | 27,895 | |
Income from continuing operations | 9,504 | 8,727 | 20,343 | 27,983 | |
Income (loss) before gain on sale of property | 8,727 | 27,983 | |||
Net income | 9,504 | 8,727 | 20,343 | 27,983 | |
Total assets | 475,265 | 475,265 | 487,708 | ||
Corporate, Non-Segment | |||||
Expenses: | |||||
Acquisition related costs | 0 | ||||
General and administrative | 3,266 | 3,816 | 12,314 | 11,350 | |
Total expenses | 3,266 | 3,816 | 12,314 | 11,350 | |
Operating income | (3,266) | (3,816) | (12,314) | (11,350) | |
Dividend income | 304 | 304 | 911 | 667 | |
Interest income | 1,661 | 47 | 1,695 | 63 | |
Interest expense | (15,654) | (12,179) | (42,361) | (30,333) | |
(Loss) gain on early extinguishment of debt | (1,715) | ||||
Income (loss) from continuing operations before income taxes and equity in earnings of investees | (18,670) | (15,644) | (52,069) | (40,953) | |
Income tax expense | (22) | (13) | (65) | (63) | |
Equity in earnings of investees | 31 | 13 | 533 | 107 | |
Income from continuing operations | (18,661) | (15,644) | (51,601) | (40,909) | |
Income (loss) before gain on sale of property | (15,644) | (40,909) | |||
Net income | (18,661) | $ (15,644) | (51,601) | $ (40,909) | |
Total assets | $ 1,280,949 | $ 1,280,949 | $ 89,798 |