Document and Entity Information
Document and Entity Information Document - shares | 6 Months Ended | |
Jun. 30, 2017 | Jul. 28, 2017 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | FEDERAL REALTY INVESTMENT TRUST | |
Entity Central Index Key | 34,903 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 72,255,197 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
ASSETS | ||
Operating (including $1,265,976 and $1,226,918 of consolidated variable interest entities, respectively) | $ 6,371,714 | $ 6,125,957 |
Construction-in-progress | 719,713 | 599,260 |
Asset held for sale | 0 | 33,856 |
Real estate, at cost, total | 7,091,427 | 6,759,073 |
Less accumulated depreciation and amortization (including $226,193 and $209,239 of consolidated variable interest entities, respectively) | (1,808,326) | (1,729,234) |
Net real estate | 5,283,101 | 5,029,839 |
Cash and cash equivalents | 96,326 | 23,368 |
Accounts and notes receivable, net | 168,996 | 116,749 |
Mortgage notes receivable, net | 30,429 | 29,904 |
Investment in real estate partnerships | 13,973 | 14,864 |
Prepaid expenses and other assets | 210,678 | 208,555 |
TOTAL ASSETS | 5,803,503 | 5,423,279 |
Liabilities | ||
Mortgages payable (including $383,304 and $439,120 of consolidated variable interest entities, respectively) | 414,891 | 471,117 |
Capital lease obligations | 71,573 | 71,590 |
Notes payable | 279,316 | 279,151 |
Senior notes and debentures | 2,377,208 | 1,976,594 |
Accounts payable and accrued expenses | 190,459 | 201,756 |
Dividends payable | 71,714 | 71,440 |
Security deposits payable | 16,618 | 16,285 |
Other liabilities and deferred credits | 143,002 | 115,817 |
Total liabilities | 3,564,781 | 3,203,750 |
Commitments and contingencies (Note 6) | ||
Redeemable noncontrolling interests | 152,045 | 143,694 |
Shareholders’ equity | ||
Preferred shares, authorized 15,000,000 shares, $.01 par: 5.417% Series 1 Cumulative Convertible Preferred Shares, (stated at liquidation preference $25 per share), 399,896 shares issued and outstanding | 9,997 | 9,997 |
Common shares of beneficial interest, $.01 par, 100,000,000 shares authorized, 72,251,477 and 71,995,897 shares issued and outstanding, respectively | 725 | 722 |
Additional paid-in capital | 2,741,803 | 2,718,325 |
Accumulated dividends in excess of net income | (759,058) | (749,734) |
Accumulated other comprehensive loss | (1,100) | (2,577) |
Total shareholders’ equity of the Trust | 1,992,367 | 1,976,733 |
Noncontrolling interests | 94,310 | 99,102 |
Total shareholders’ equity | 2,086,677 | 2,075,835 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 5,803,503 | $ 5,423,279 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Jun. 30, 2017 | Dec. 31, 2016 | |
Statement of Financial Position [Abstract] | |||
Operating real estate, consolidated variable interest entities | $ 1,265,976 | $ 1,265,976 | $ 1,226,918 |
Accumulated depreciation and amortization, consolidated variable interest entities | 226,193 | 226,193 | 209,239 |
Mortgages payable, consolidated variable interest entities | $ 383,304 | $ 383,304 | $ 439,120 |
Preferred shares, authorized | 15,000,000 | 15,000,000 | 15,000,000 |
Preferred shares, par value | $ 0.01 | $ 0.01 | $ 0.01 |
Series 1 Cumulative Convertible Preferred Shares Interest Rate | 5.417% | 5.417% | 5.417% |
Preferred Shares, 5.417% Series 1 Cumulative Convertible liquidation preference | $ 25 | $ 25 | $ 25 |
Preferred shares, shares issued | 399,896 | 399,896 | 399,896 |
Preferred shares, shares outstanding | 399,896 | 399,896 | 399,896 |
Common shares of beneficial interest, par value | $ 0.01 | $ 0.01 | $ 0.01 |
Common shares of beneficial interest, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 |
Common shares of beneficial interest, shares issued | 72,251,477 | 72,251,477 | 71,995,897 |
Common shares of beneficial interest, shares outstanding | 72,251,477 | 72,251,477 | 71,995,897 |
Consolidated Statements Of Oper
Consolidated Statements Of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
REVENUE | ||||
Rental income | $ 204,246 | $ 192,935 | $ 408,693 | $ 388,243 |
Other property income | 3,068 | 3,488 | 5,258 | 5,800 |
Mortgage interest income | 735 | 1,558 | 1,487 | 2,282 |
Total revenue | 208,049 | 197,981 | 415,438 | 396,325 |
EXPENSES | ||||
Rental expenses | 37,128 | 36,978 | 78,237 | 79,797 |
Real estate taxes | 26,522 | 23,397 | 51,612 | 46,191 |
General and administrative | 8,643 | 9,036 | 16,910 | 17,046 |
Depreciation and amortization | 52,666 | 48,435 | 104,045 | 96,234 |
Total operating expenses | 124,959 | 117,846 | 250,804 | 239,268 |
OPERATING INCOME | 83,090 | 80,135 | 164,634 | 157,057 |
Other interest income | 68 | 77 | 174 | 180 |
Interest expense | (23,907) | (23,101) | (47,665) | (46,830) |
(Loss) income from real estate partnerships | (114) | 0 | (114) | 41 |
INCOME FROM CONTINUING OPERATIONS | 59,137 | 57,111 | 117,029 | 110,448 |
Gain on sale of real estate and change in control of interests, net | 18,996 | 1,787 | 19,174 | 27,513 |
NET INCOME | 78,133 | 58,898 | 136,203 | 137,961 |
Net income attributable to noncontrolling interests | (1,842) | (2,957) | (3,722) | (5,065) |
NET INCOME ATTRIBUTABLE TO THE TRUST | 76,291 | 55,941 | 132,481 | 132,896 |
Dividends on preferred shares | (135) | (135) | (271) | (271) |
NET INCOME AVAILABLE FOR COMMON SHAREHOLDERS | $ 76,156 | $ 55,806 | $ 132,210 | $ 132,625 |
EARNINGS PER COMMON SHARE, BASIC | ||||
Continuing operations | $ 0.79 | $ 0.78 | $ 1.57 | $ 1.50 |
Gain on sale of real estate and change in control of interests, net | 0.26 | 0.01 | 0.26 | 0.38 |
Earnings per common share, basic | $ 1.05 | $ 0.79 | $ 1.83 | $ 1.88 |
Weighted average number of common shares, basic | 72,001 | 70,797 | 71,928 | 70,270 |
EARNINGS PER COMMON SHARE, DILUTED | ||||
Continuing operations | $ 0.79 | $ 0.77 | $ 1.57 | $ 1.50 |
Gain on sale of real estate and change in control of interests, net | 0.26 | 0.01 | 0.26 | 0.38 |
Earnings per common share, diluted | $ 1.05 | $ 0.78 | $ 1.83 | $ 1.88 |
Weighted average number of common shares, diluted | 72,124 | 70,974 | 72,061 | 70,451 |
COMPREHENSIVE INCOME | $ 78,526 | $ 58,490 | $ 137,680 | $ 134,778 |
COMPREHENSIVE INCOME ATTRIBUTABLE TO THE TRUST | $ 76,684 | $ 55,533 | $ 133,958 | $ 129,713 |
Consolidated Statement Of Share
Consolidated Statement Of Shareholders' Equity - 6 months ended Jun. 30, 2017 - USD ($) $ in Thousands | Total | Preferred Shares | Common shares | Additional Paid-in Capital | Accumulated Dividends in Excess of Net Income | Accumulated Other Comprehensive Loss | Noncontrolling Interests |
Beginning balance (in shares) at Dec. 31, 2016 | 399,896 | 71,995,897 | |||||
Beginning balance at Dec. 31, 2016 | $ 2,075,835 | $ 9,997 | $ 722 | $ 2,718,325 | $ (749,734) | $ (2,577) | $ 99,102 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
January 1, 2017 adoption of new accounting standard - See Note 2 | 0 | 83 | (83) | ||||
Net income, excluding $1,704 attributable to redeemable noncontrolling interests | 134,499 | 132,481 | 2,018 | ||||
Other comprehensive income - change in fair value of interest rate swaps | 1,477 | 1,477 | |||||
Dividends declared to common shareholders | (141,451) | (141,451) | |||||
Dividends declared to preferred shareholders | (271) | (271) | |||||
Distributions declared to noncontrolling interests | (3,310) | (3,310) | |||||
Common shares issued (in shares) | 98,695 | ||||||
Common shares issued | 13,342 | $ 1 | 13,341 | ||||
Exercise of stock options (in shares) | 52,307 | ||||||
Exercise of stock options | 3,831 | $ 1 | 3,830 | ||||
Shares issued under dividend reinvestment plan (in shares) | 9,140 | ||||||
Shares issued under dividend reinvestment plan | 1,253 | 1,253 | |||||
Share-based compensation expense, net of forfeitures (in shares) | 103,941 | ||||||
Share-based compensation expense, net of forfeitures | 6,457 | $ 1 | 6,456 | ||||
Shares withheld for employee taxes (in shares) | (28,533) | ||||||
Shares withheld for employee taxes | (4,077) | (4,077) | |||||
Conversion and redemption of OP units (in shares) | 20,030 | ||||||
Conversion and redemption of OP units | 0 | 2,569 | (2,569) | ||||
Contributions from noncontrolling interests | 4,547 | 4,547 | |||||
Purchase of noncontrolling interest | (5,455) | 23 | (5,478) | ||||
Ending balance (in shares) at Jun. 30, 2017 | 399,896 | 72,251,477 | |||||
Ending balance at Jun. 30, 2017 | $ 2,086,677 | $ 9,997 | $ 725 | $ 2,741,803 | $ (759,058) | $ (1,100) | $ 94,310 |
Consolidated Statement Of Shar6
Consolidated Statement Of Shareholders' Equity (Parentheticals) $ in Thousands | 6 Months Ended |
Jun. 30, 2017USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Net income attributable to redeemable noncontrolling interests | $ 1,704 |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
OPERATING ACTIVITIES | ||
Net income | $ 136,203 | $ 137,961 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 104,045 | 96,234 |
Gain on sale of real estate and change in control of interests, net | (19,174) | (27,513) |
Loss (income) from real estate partnerships | 114 | (41) |
Other, net | (2,934) | 278 |
Changes in assets and liabilities, net of effects of acquisitions and dispositions: | ||
Decrease in accounts receivable | 3,467 | 935 |
Decrease (increase) in prepaid expenses and other assets | 13,767 | (1,075) |
Increase in accounts payable and accrued expenses | 1,568 | 432 |
Increase (decrease) in security deposits and other liabilities | 4,773 | (3,604) |
Net cash provided by operating activities | 241,829 | 203,607 |
INVESTING ACTIVITIES | ||
Acquisition of real estate | (168,345) | (129,770) |
Capital expenditures - development and redevelopment | (229,198) | (142,091) |
Capital expenditures - other | (33,622) | (23,594) |
Proceeds from sale of real estate and real estate partnership interests | 46,731 | 0 |
Investment in real estate partnerships | (430) | (2,064) |
Distribution from real estate partnership in excess of earnings | 1,672 | 3,800 |
Leasing costs | (6,273) | (7,188) |
(Issuance) repayment of mortgage and other notes receivable, net | (514) | 5 |
Net cash used in investing activities | (389,979) | (300,902) |
FINANCING ACTIVITIES | ||
Net borrowings under revolving credit facility | 0 | 41,500 |
Issuance of senior notes, net of costs | 399,410 | 0 |
Repayment of mortgages and capital leases | (53,924) | (37,233) |
Issuance of common shares, net of costs | 17,390 | 245,221 |
Dividends paid to common and preferred shareholders | (140,447) | (131,076) |
Shares withheld for employee taxes | (4,077) | (4,371) |
Contributions from noncontrolling interests | 13,068 | 80 |
Distributions to and redemptions of noncontrolling interests | (10,312) | (19,250) |
Net cash provided by financing activities | 221,108 | 94,871 |
Increase (decrease) in cash and cash equivalents | 72,958 | (2,424) |
Cash and cash equivalents at beginning of year | 23,368 | 21,046 |
Cash and cash equivalents at end of period | $ 96,326 | $ 18,622 |
Business And Organization
Business And Organization | 6 Months Ended |
Jun. 30, 2017 | |
Nature Of Operations [Abstract] | |
BUSINESS AND ORGANIZATION | BUSINESS AND ORGANIZATION Federal Realty Investment Trust (the “Trust”) is an equity real estate investment trust (“REIT”) specializing in the ownership, management, and redevelopment of retail and mixed-use properties. Our properties are located primarily in densely populated and affluent communities in strategically selected metropolitan markets in the Mid-Atlantic and Northeast regions of the United States, California, and South Florida. As of June 30, 2017 , we owned or had a majority interest in community and neighborhood shopping centers and mixed-use properties which are operated as 99 predominantly retail real estate projects. We operate in a manner intended to enable us to qualify as a REIT for federal income tax purposes. A REIT that distributes at least 90% of its taxable income to its shareholders each year and meets certain other conditions is not taxed on that portion of its taxable income which is distributed to its shareholders. Therefore, federal income taxes on our taxable income have been and are generally expected to be immaterial. We are obligated to pay state taxes, generally consisting of franchise or gross receipts taxes in certain states. Such state taxes also have not been material. |
Summary Of Significant Accounti
Summary Of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation Our consolidated financial statements include the accounts of the Trust, its corporate subsidiaries, and all entities in which the Trust has a controlling interest or has been determined to be the primary beneficiary of a variable interest entity (“VIE”). The equity interests of other investors are reflected as noncontrolling interests or redeemable noncontrolling interests. All significant intercompany transactions and balances are eliminated in consolidation. We account for our interests in joint ventures, which we do not control, using the equity method of accounting. Certain 2016 amounts have been reclassified to conform to current period presentation. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, referred to as “GAAP,” requires management to make estimates and assumptions that in certain circumstances affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and revenues and expenses. These estimates are prepared using management’s best judgment, after considering past, current and expected events and economic conditions. Actual results could differ from these estimates. Revenue Recognition We are currently under construction on 221 condominium units at our Assembly Row and Pike & Rose properties. Gains or losses on the sale of these condominium units are recognized in accordance with the provisions of ASC Topic 360-20, “Property, Plant and Equipment – Real Estate Sales.” We account for contracted condominium sales under the percentage-of-completion method, based on an evaluation of the criteria specified in ASC Topic 360-20 including: the legal commitment of the purchaser in the real estate contract, whether the construction of the project is beyond a preliminary phase, whether sufficient units have been contracted to ensure the project will not revert to a rental project, the ability to reasonably estimate the aggregate project sale proceeds and aggregate project costs, and the determination that the buyer has made an adequate initial and continuing cash investment under the contract. When the percentage-of-completion criteria have not been met, no profit is recognized. The application of this criteria can be complex and requires us to make assumptions. Recently Issued Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers." ASU 2014-09 as amended and interpreted by ASU 2015-14, ASU 2016-08, ASU 2016-10, ASU 2016-12, and ASU 2016-20, supersedes nearly all existing revenue recognition guidance under GAAP and replaces it with a core revenue recognition principle, that an entity will recognize revenue when it transfers control 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, and creates a five-step model for revenue recognition in accordance with this principle. While we are still completing the assessment of the impact of these standards to our consolidated financial statements, we believe the majority of our revenue falls outside of the scope of this guidance. However, the new guidance will affect the accounting method related to our gains on condominium sales. Currently, gains on contracted sales are recognized using the percentage-of-completion method, with the gain recognized once certain criteria have been met in advance of legal closing. Under the new guidance, condominium sale gains will be recognized as the condominium units are legally sold, which will typically be upon closing. We intend to implement the new revenue recognition guidance retrospectively with the cumulative effect recognized in retained earnings at the date of initial application. In February 2017, the FASB issued ASU 2017-05, "Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets." ASU 2017-05 clarifies that ASC 610-20 applies to all nonfinancial assets (including real estate) for which the counterparty is not a customer and also clarifies that all businesses are derecognized using the deconsolidation guidance. Additionally, it defines an insubstance nonfinancial asset as a financial asset that is promised to a counterparty in a contract in which substantially all of the fair value of the assets promised in the contract is concentrated in nonfinancial assets, which excludes cash or cash equivalents and liabilities. The new guidance is expected to impact the gain recognized when a real estate asset is sold to a non-customer and a noncontrolling interest is retained. Under the current guidance, a partial sale is recognized and carryover basis is used for the retained interest, however, the new guidance eliminates the use of carryover basis and generally requires a full gain to be recognized. ASU 2017-05 is effective for us in the first quarter of 2018, and we are currently assessing the impact of this standard to our consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, "Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting." ASU 2017-09 clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. Under the new guidance, an entity will not apply modification accounting if the awards' fair value, vesting conditions, and the classification of the award as equity or a liability are the same immediately before and after the change. ASU 2017-09 is effective for us in the first quarter of 2018, is applied prospectively to awards granted or modified after the adoption date, and is not expected to have a significant impact to our consolidated financial statements. Recently Adopted Accounting Pronouncements In March 2016, the FASB issued ASU 2016-09, "Compensation - Stock Compensation." ASU 2016-09 simplifies the accounting for share-based payment transactions, including a policy election option with respect to accounting for forfeitures either as they occur or estimating forfeitures (as is currently required), as well as increasing the amount an employer can withhold to cover income taxes on equity awards. Additionally, ASU 2016-09 requires the cash paid to a taxing authority when shares are withheld to pay employee taxes to be classified as a "financing activity" rather than an "operating activity," as was done previously on the Statement of Cash Flows. We adopted this standard effective January 1, 2017, and as a result, we are now accounting for forfeitures as they occur, and have recorded the cumulative impact on the adoption date as a $0.1 million adjustment to additional paid in capital and retained earnings. The amount reclassified from "operating activities" to "financing activities" for shares withheld for employee taxes was $4.4 million . In January 2017, the FASB issued ASU 2017-01, "Clarifying the Definition of a Business." ASU 2017-01 changes the definition of a business to exclude acquisitions where substantially all of the fair value of the assets acquired are concentrated in a single identifiable asset or a group of similar identifiable assets. Given this change in definition, we believe most of our shopping center acquisitions will no longer be considered business combinations but rather asset acquisitions. While there are various differences between the accounting for an asset acquisition and a business combination, the largest impact will be that transaction costs are capitalized for asset acquisitions rather than expensed when they were considered business combinations. Based on acquisitions in the past several years, transaction costs for a single shopping center acquisition have typically ranged from $0.2 million to $2.4 million with significantly higher transaction costs expected for an acquisition of a larger portfolio. We adopted this standard effective January 1, 2017, and are applying the new guidance prospectively. Our acquisitions in the first six months of 2017 (further discussed in Note 3 below) qualified as asset acquisitions and consequently, all transaction costs were capitalized. Consolidated Statements of Cash Flows—Supplemental Disclosures The following table provides supplemental disclosures related to the Consolidated Statements of Cash Flows: Six Months Ended June 30, 2017 2016 (In thousands) SUPPLEMENTAL DISCLOSURES: Total interest costs incurred $ 59,304 $ 54,803 Interest capitalized (11,639 ) (7,973 ) Interest expense $ 47,665 $ 46,830 Cash paid for interest, net of amounts capitalized $ 47,995 $ 45,577 Cash paid for income taxes $ 341 $ 250 NON-CASH INVESTING AND FINANCING TRANSACTIONS: Mortgage loans refinanced $ 125,000 $ — Mortgage loans assumed with acquisition $ — $ 34,385 DownREIT operating partnership units issued with acquisition of noncontrolling interest $ 5,918 $ — DownREIT operating partnership units redeemed for common shares $ 2,569 $ 18,164 Shares issued under dividend reinvestment plan $ 1,036 $ 1,047 |
Real Estate
Real Estate | 6 Months Ended |
Jun. 30, 2017 | |
Real Estate [Abstract] | |
REAL ESTATE | REAL ESTATE On February 1, 2017 , we acquired a leasehold interest in Hastings Ranch Plaza, a 274,000 square foot shopping center in Pasadena, California for $29.5 million . The land is subject to a long-term ground lease that expires on April 30, 2054. Approximately $21.5 million of assets acquired were allocated to lease intangibles and included within other assets. Approximately $15.2 million of net assets acquired were allocated to lease liabilities and included in other liabilities. On March 31, 2017 , we acquired the fee interest in Riverpoint Center, a 211,000 square foot shopping center in the Lincoln Park neighborhood of Chicago, Illinois for $107.0 million . Approximately $1.0 million and $12.3 million of net assets acquired were allocated to other assets for "above market leases," and other liabilities for "below market leases," respectively. We leased three parcels of land at our Assembly Row property to two ground lessees. During 2016, both lessees exercised purchase options under the related ground leases. The sale transaction related to the purchase option on one of our ground leases was completed on April 4, 2017 for a sales price of $36.0 million . On June 28, 2017 , the sale transactions related to the purchase options on our other two ground lease parcels were completed for a total sales price of $17.3 million . The net gain recognized in connection with these transactions was approximately $15.4 million . On May 19, 2017 , we acquired the fee interest in a 71,000 square foot, mixed-use property located in Berkeley, California based on a gross value of $23.9 million . The acquisition was completed through a newly formed entity for which we own a 90% controlling interest. Approximately $0.8 million and $0.3 million of net assets acquired were allocated to other assets for "above market leases," and other liabilities for "below market leases," respectively. Additionally, approximately $2.4 million was allocated to noncontrolling interests. For the three and six months ended June 30, 2017 we recognized a $3.3 million gain, net of $1.7 million of income taxes, related to the sale of condominiums at our Assembly Row property based on the percentage-of-completion method. In connection with recording the gain, we recognized a receivable of $43.3 million . The closing of the Assembly Row condominium sales is expected to commence in 2018. As of June 30, 2017 , no gain has been recognized for contracted condominium sales at Pike & Rose, as not all of the criteria necessary for profit recognition have been met. |
Debt
Debt | 6 Months Ended |
Jun. 30, 2017 | |
Debt Instruments [Abstract] | |
DEBT | DEBT On June 5, 2017 we refinanced the $175.0 million mortgage loan on Plaza El Segundo at a face amount of $125.0 million and repaid the remaining $50.0 million at par. The new mortgage loan bears interest at 3.83% and matures on June 5, 2027 . On June 23, 2017 , we issued $400.0 million aggregate principal amount of fixed rate senior unsecured notes in two separate series. We issued $300.0 million of 3.25% notes that mature on July 15, 2027 , were offered at 99.083% of the principal amount, with a yield to maturity of 3.358% . Additionally, we issued $100.0 million of 4.50% notes due December 1, 2044 . The 4.50% notes were offered at 105.760% of the principal amount, with a yield to maturity of 4.143% , and have the same terms and are of the same series as the senior notes first issued on November 14, 2014 . Our net proceeds from the June note offering after net issuance premium, underwriting fees and other costs was approximately $399.4 million . During the three and six months ended June 30, 2017 , the maximum amount of borrowings outstanding under our $800.0 million revolving credit facility was $344.0 million , and the weighted average interest rate, before amortization of debt fees, was 1.8% , for both periods. During the three and six months ended June 30, 2017 , the weighted average borrowings outstanding were $252.1 million and $173.2 million , respectively. At June 30, 2017 , there was no outstanding balance. Our revolving credit facility, term loan and certain notes require us to comply with various financial covenants, including the maintenance of minimum shareholders’ equity and debt coverage ratios and a maximum ratio of debt to net worth. As of June 30, 2017 , we were in compliance with all default related debt covenants. |
Fair Value Of Financial Instrum
Fair Value Of Financial Instruments | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | FAIR VALUE OF FINANCIAL INSTRUMENTS Except as disclosed below, the carrying amount of our financial instruments approximates their fair value. The fair value of our mortgages payable, notes payable and senior notes and debentures is sensitive to fluctuations in interest rates. Quoted market prices (Level 1) were used to estimate the fair value of our marketable senior notes and debentures and discounted cash flow analysis (Level 2) is generally used to estimate the fair value of our mortgages and notes payable. Considerable judgment is necessary to estimate the fair value of financial instruments. The estimates of fair value presented herein are not necessarily indicative of the amounts that could be realized upon disposition of the financial instruments. A summary of the carrying amount and fair value of our mortgages payable, notes payable and senior notes and debentures is as follows: June 30, 2017 December 31, 2016 Carrying Value Fair Value Carrying Value Fair Value (In thousands) Mortgages and notes payable $ 694,207 $ 702,636 $ 750,268 $ 760,260 Senior notes and debentures $ 2,377,208 $ 2,438,952 $ 1,976,594 $ 2,015,973 As of June 30, 2017 , we have two interest rate swap agreements with a notional amount of $275.0 million that are measured at fair value on a recurring basis. The interest rate swap agreements fix the variable portion of our $275.0 million term loan at 1.72% through November 1, 2018. We assess effectiveness of our cash flow hedges both at inception and on an ongoing basis. The effective portion of changes in fair value of the interest rate swaps associated with our cash flow hedges is recorded in accumulated other comprehensive loss and is subsequently reclassified into interest expense as interest is incurred on the related variable rate debt. Within the next 12 months, we expect to reclassify an estimated $1.0 million as an increase to interest expense. Our cash flow hedges become ineffective if critical terms of the hedging instrument and the debt instrument do not perfectly match such as notional amounts, settlement dates, reset dates, calculation period and LIBOR rate. In addition, we evaluate the default risk of the counterparty by monitoring the credit-worthiness of the counterparty. When ineffectiveness exists, the ineffective portion of changes in fair value of the interest rate swaps associated with our cash flow hedges is recognized in earnings in the period affected. Hedge ineffectiveness has not impacted earnings as of June 30, 2017 , and we do not anticipate it will have a significant effect in the future. The fair values of the interest rate swap agreements are based on the estimated amounts we would receive or pay to terminate the contracts at the reporting date and are determined using interest rate pricing models and interest rate related observable inputs. The fair value of our swaps at June 30, 2017 was a liability of $1.1 million and is included in "accounts payable and accrued expenses" on our consolidated balance sheet. For the three and six months ended June 30, 2017 , the change in valuation on our interest rate swaps resulted in a $0.4 million and $1.5 million decrease in our derivative liability, respectively, (including $0.5 million and $1.1 million , respectively, reclassified from other comprehensive loss to interest expense). The change in valuation on our interest rate swaps is included in "accumulated other comprehensive loss." A summary of our financial liabilities that are measured at fair value on a recurring basis, by level within the fair value hierarchy is as follows: June 30, 2017 December 31, 2016 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total (In thousands) Interest rate swaps $ — $ 1,100 $ — $ 1,100 $ — $ 2,577 $ — $ 2,577 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES We are sometimes involved in lawsuits, warranty claims, and environmental matters arising in the ordinary course of business. Management makes assumptions and estimates concerning the likelihood and amount of any potential loss relating to these matters. We are currently a party to various legal proceedings. We accrue a liability for litigation if an unfavorable outcome is probable and the amount of loss can be reasonably estimated. If an unfavorable outcome is probable and a reasonable estimate of the loss is a range, we accrue the best estimate within the range; however, if no amount within the range is a better estimate than any other amount, the minimum within the range is accrued. Legal fees related to litigation are expensed as incurred. Other than as described below, we do not believe that the ultimate outcome of these matters, either individually or in the aggregate, could have a material adverse effect on our financial position or overall trends in results of operations; however, litigation is subject to inherent uncertainties. Also under our leases, tenants are typically obligated to indemnify us from and against all liabilities, costs and expenses imposed upon or asserted against us (1) as owner of the properties due to certain matters relating to the operation of the properties by the tenant, and (2) where appropriate, due to certain matters relating to the ownership of the properties prior to their acquisition by us. Under the terms of certain partnership agreements, the partners have the right to exchange their operating partnership units for cash or the same number of our common shares, at our option. A total of 787,962 downREIT operating partnership units are outstanding which have a total fair value of $99.6 million , based on our closing stock price on June 30, 2017 . On January 12, 2017 , we exercised our purchase option on non-controlling interests in San Antonio Center for $2.6 million of cash and 44,195 of downREIT operating partnership units. |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended |
Jun. 30, 2017 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS’ EQUITY | SHAREHOLDERS’ EQUITY The following table provides a summary of dividends declared and paid per share: Six Months Ended June 30, 2017 2016 Declared Paid Declared Paid Common shares $ 1.960 $ 1.960 $ 1.880 $ 1.880 5.417% Series 1 Cumulative Convertible Preferred shares $ 0.677 $ 0.677 $ 0.677 $ 0.677 We have an at the market (“ATM”) equity program in which we may from time to time offer and sell common shares having an aggregate offering price of up to $400.0 million . We intend to use the net proceeds to fund potential acquisition opportunities, fund our development and redevelopment pipeline, repay amounts outstanding under our revolving credit facility and/or for general corporate purposes. For the six months ended June 30, 2017 , we issued 98,658 common shares at a weighted average price per share of $137.90 for net cash proceeds of $13.4 million and paid $0.1 million in commissions and $0.1 million in additional offering expenses related to the sales of these common shares. As of June 30, 2017 , we had the capacity to issue up to $357.3 million in common shares under our ATM equity program. |
Components Of Rental Income
Components Of Rental Income | 6 Months Ended |
Jun. 30, 2017 | |
Components Of Rental Income and Expense [Abstract] | |
COMPONENTS OF RENTAL INCOME | COMPONENTS OF RENTAL INCOME The principal components of rental income are as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 (In thousands) Minimum rents Retail and commercial $ 144,276 $ 137,432 $ 286,419 $ 272,018 Residential 13,441 12,141 26,944 23,590 Cost reimbursement 39,877 36,637 81,395 78,439 Percentage rents 2,397 2,482 5,220 5,551 Other 4,255 4,243 8,715 8,645 Total rental income $ 204,246 $ 192,935 $ 408,693 $ 388,243 Minimum rents include the following: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 (In millions) Straight-line rents $ 3.8 $ 2.7 $ 7.4 $ 4.7 Amortization of above market leases $ (1.4 ) $ (1.7 ) $ (2.8 ) $ (3.6 ) Amortization of below market leases $ 2.7 $ 2.1 $ 5.2 $ 4.3 |
Share-Based Compensation Plans
Share-Based Compensation Plans | 6 Months Ended |
Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHARE-BASED COMPENSATION PLANS | SHARE-BASED COMPENSATION PLANS A summary of share-based compensation expense included in net income is as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 (In thousands) Grants of common shares and options $ 2,908 $ 2,523 $ 6,457 $ 6,052 Capitalized share-based compensation (381 ) (325 ) (698 ) (627 ) Share-based compensation expense $ 2,527 $ 2,198 $ 5,759 $ 5,425 |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE We have calculated earnings per share (“EPS”) under the two-class method. The two-class method is an earnings allocation methodology whereby EPS for each class of common stock and participating securities is calculated according to dividends declared and participation rights in undistributed earnings. For the three and six months ended June 30, 2017 and 2016 , we had 0.2 million weighted average unvested shares outstanding, which are considered participating securities. Therefore, we have allocated our earnings for basic and diluted EPS between common shares and unvested shares; the portion of earnings allocated to the unvested shares is reflected as “earnings allocated to unvested shares” in the reconciliation below. In the dilutive EPS calculation, dilutive stock options were calculated using the treasury stock method consistent with prior periods. There were no anti-dilutive stock options for the three and six months ended June 30, 2017 and 2016 . The conversions of downREIT operating partnership units and 5.417% Series 1 Cumulative Convertible Preferred Shares are anti-dilutive for all periods presented and accordingly, have been excluded from the weighted average common shares used to compute diluted EPS. Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 (In thousands, except per share data) NUMERATOR Income from continuing operations $ 59,137 $ 57,111 $ 117,029 $ 110,448 Less: Preferred share dividends (135 ) (135 ) (271 ) (271 ) Less: Income from continuing operations attributable to noncontrolling interests (1,660 ) (1,871 ) (3,432 ) (3,979 ) Less: Earnings allocated to unvested shares (251 ) (156 ) (468 ) (364 ) Income from continuing operations available for common shareholders 57,091 54,949 112,858 105,834 Gain on sale of real estate and change in control of interests, net 18,814 701 18,884 26,427 Net income available for common shareholders, basic and diluted $ 75,905 $ 55,650 $ 131,742 $ 132,261 DENOMINATOR Weighted average common shares outstanding—basic 72,001 70,797 71,928 70,270 Stock options 123 177 133 181 Weighted average common shares outstanding—diluted 72,124 70,974 72,061 70,451 EARNINGS PER COMMON SHARE, BASIC Continuing operations $ 0.79 $ 0.78 $ 1.57 $ 1.50 Gain on sale of real estate and change in control of interests, net 0.26 0.01 0.26 0.38 $ 1.05 $ 0.79 $ 1.83 $ 1.88 EARNINGS PER COMMON SHARE, DILUTED Continuing operations $ 0.79 $ 0.77 $ 1.57 $ 1.50 Gain on sale of real estate and change in control of interests, net 0.26 0.01 0.26 0.38 $ 1.05 $ 0.78 $ 1.83 $ 1.88 Income from continuing operations attributable to the Trust $ 57,477 $ 55,240 $ 113,597 $ 106,469 |
Summary of Significant Accoun18
Summary of Significant Accounting Policies (Policy) | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation Our consolidated financial statements include the accounts of the Trust, its corporate subsidiaries, and all entities in which the Trust has a controlling interest or has been determined to be the primary beneficiary of a variable interest entity (“VIE”). The equity interests of other investors are reflected as noncontrolling interests or redeemable noncontrolling interests. All significant intercompany transactions and balances are eliminated in consolidation. We account for our interests in joint ventures, which we do not control, using the equity method of accounting. Certain 2016 amounts have been reclassified to conform to current period presentation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, referred to as “GAAP,” requires management to make estimates and assumptions that in certain circumstances affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and revenues and expenses. These estimates are prepared using management’s best judgment, after considering past, current and expected events and economic conditions. Actual results could differ from these estimates. |
Revenue Recognition | Revenue Recognition We are currently under construction on 221 condominium units at our Assembly Row and Pike & Rose properties. Gains or losses on the sale of these condominium units are recognized in accordance with the provisions of ASC Topic 360-20, “Property, Plant and Equipment – Real Estate Sales.” We account for contracted condominium sales under the percentage-of-completion method, based on an evaluation of the criteria specified in ASC Topic 360-20 including: the legal commitment of the purchaser in the real estate contract, whether the construction of the project is beyond a preliminary phase, whether sufficient units have been contracted to ensure the project will not revert to a rental project, the ability to reasonably estimate the aggregate project sale proceeds and aggregate project costs, and the determination that the buyer has made an adequate initial and continuing cash investment under the contract. When the percentage-of-completion criteria have not been met, no profit is recognized. The application of this criteria can be complex and requires us to make assumptions. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers." ASU 2014-09 as amended and interpreted by ASU 2015-14, ASU 2016-08, ASU 2016-10, ASU 2016-12, and ASU 2016-20, supersedes nearly all existing revenue recognition guidance under GAAP and replaces it with a core revenue recognition principle, that an entity will recognize revenue when it transfers control 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, and creates a five-step model for revenue recognition in accordance with this principle. While we are still completing the assessment of the impact of these standards to our consolidated financial statements, we believe the majority of our revenue falls outside of the scope of this guidance. However, the new guidance will affect the accounting method related to our gains on condominium sales. Currently, gains on contracted sales are recognized using the percentage-of-completion method, with the gain recognized once certain criteria have been met in advance of legal closing. Under the new guidance, condominium sale gains will be recognized as the condominium units are legally sold, which will typically be upon closing. We intend to implement the new revenue recognition guidance retrospectively with the cumulative effect recognized in retained earnings at the date of initial application. In February 2017, the FASB issued ASU 2017-05, "Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets." ASU 2017-05 clarifies that ASC 610-20 applies to all nonfinancial assets (including real estate) for which the counterparty is not a customer and also clarifies that all businesses are derecognized using the deconsolidation guidance. Additionally, it defines an insubstance nonfinancial asset as a financial asset that is promised to a counterparty in a contract in which substantially all of the fair value of the assets promised in the contract is concentrated in nonfinancial assets, which excludes cash or cash equivalents and liabilities. The new guidance is expected to impact the gain recognized when a real estate asset is sold to a non-customer and a noncontrolling interest is retained. Under the current guidance, a partial sale is recognized and carryover basis is used for the retained interest, however, the new guidance eliminates the use of carryover basis and generally requires a full gain to be recognized. ASU 2017-05 is effective for us in the first quarter of 2018, and we are currently assessing the impact of this standard to our consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, "Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting." ASU 2017-09 clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. Under the new guidance, an entity will not apply modification accounting if the awards' fair value, vesting conditions, and the classification of the award as equity or a liability are the same immediately before and after the change. ASU 2017-09 is effective for us in the first quarter of 2018, is applied prospectively to awards granted or modified after the adoption date, and is not expected to have a significant impact to our consolidated financial statements. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In March 2016, the FASB issued ASU 2016-09, "Compensation - Stock Compensation." ASU 2016-09 simplifies the accounting for share-based payment transactions, including a policy election option with respect to accounting for forfeitures either as they occur or estimating forfeitures (as is currently required), as well as increasing the amount an employer can withhold to cover income taxes on equity awards. Additionally, ASU 2016-09 requires the cash paid to a taxing authority when shares are withheld to pay employee taxes to be classified as a "financing activity" rather than an "operating activity," as was done previously on the Statement of Cash Flows. We adopted this standard effective January 1, 2017, and as a result, we are now accounting for forfeitures as they occur, and have recorded the cumulative impact on the adoption date as a $0.1 million adjustment to additional paid in capital and retained earnings. The amount reclassified from "operating activities" to "financing activities" for shares withheld for employee taxes was $4.4 million . In January 2017, the FASB issued ASU 2017-01, "Clarifying the Definition of a Business." ASU 2017-01 changes the definition of a business to exclude acquisitions where substantially all of the fair value of the assets acquired are concentrated in a single identifiable asset or a group of similar identifiable assets. Given this change in definition, we believe most of our shopping center acquisitions will no longer be considered business combinations but rather asset acquisitions. While there are various differences between the accounting for an asset acquisition and a business combination, the largest impact will be that transaction costs are capitalized for asset acquisitions rather than expensed when they were considered business combinations. Based on acquisitions in the past several years, transaction costs for a single shopping center acquisition have typically ranged from $0.2 million to $2.4 million with significantly higher transaction costs expected for an acquisition of a larger portfolio. We adopted this standard effective January 1, 2017, and are applying the new guidance prospectively. Our acquisitions in the first six months of 2017 (further discussed in Note 3 below) qualified as asset acquisitions and consequently, all transaction costs were capitalized. |
Summary Of Significant Accoun19
Summary Of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Supplemental disclosures related to the Consolidated Statements Of Cash Flows | The following table provides supplemental disclosures related to the Consolidated Statements of Cash Flows: Six Months Ended June 30, 2017 2016 (In thousands) SUPPLEMENTAL DISCLOSURES: Total interest costs incurred $ 59,304 $ 54,803 Interest capitalized (11,639 ) (7,973 ) Interest expense $ 47,665 $ 46,830 Cash paid for interest, net of amounts capitalized $ 47,995 $ 45,577 Cash paid for income taxes $ 341 $ 250 NON-CASH INVESTING AND FINANCING TRANSACTIONS: Mortgage loans refinanced $ 125,000 $ — Mortgage loans assumed with acquisition $ — $ 34,385 DownREIT operating partnership units issued with acquisition of noncontrolling interest $ 5,918 $ — DownREIT operating partnership units redeemed for common shares $ 2,569 $ 18,164 Shares issued under dividend reinvestment plan $ 1,036 $ 1,047 |
Fair Value Of Financial Instr20
Fair Value Of Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Summary of carrying amount and fair value of financial instruments | A summary of the carrying amount and fair value of our mortgages payable, notes payable and senior notes and debentures is as follows: June 30, 2017 December 31, 2016 Carrying Value Fair Value Carrying Value Fair Value (In thousands) Mortgages and notes payable $ 694,207 $ 702,636 $ 750,268 $ 760,260 Senior notes and debentures $ 2,377,208 $ 2,438,952 $ 1,976,594 $ 2,015,973 |
Summary of financial liabilities measured at fair value on a recurring basis | A summary of our financial liabilities that are measured at fair value on a recurring basis, by level within the fair value hierarchy is as follows: June 30, 2017 December 31, 2016 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total (In thousands) Interest rate swaps $ — $ 1,100 $ — $ 1,100 $ — $ 2,577 $ — $ 2,577 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Stockholders' Equity Note [Abstract] | |
Summary of dividends declared and paid per share | The following table provides a summary of dividends declared and paid per share: Six Months Ended June 30, 2017 2016 Declared Paid Declared Paid Common shares $ 1.960 $ 1.960 $ 1.880 $ 1.880 5.417% Series 1 Cumulative Convertible Preferred shares $ 0.677 $ 0.677 $ 0.677 $ 0.677 |
Components Of Rental Income (Ta
Components Of Rental Income (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Components Of Rental Income and Expense [Abstract] | |
Principal components of rental income | The principal components of rental income are as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 (In thousands) Minimum rents Retail and commercial $ 144,276 $ 137,432 $ 286,419 $ 272,018 Residential 13,441 12,141 26,944 23,590 Cost reimbursement 39,877 36,637 81,395 78,439 Percentage rents 2,397 2,482 5,220 5,551 Other 4,255 4,243 8,715 8,645 Total rental income $ 204,246 $ 192,935 $ 408,693 $ 388,243 |
Minimum rents | Minimum rents include the following: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 (In millions) Straight-line rents $ 3.8 $ 2.7 $ 7.4 $ 4.7 Amortization of above market leases $ (1.4 ) $ (1.7 ) $ (2.8 ) $ (3.6 ) Amortization of below market leases $ 2.7 $ 2.1 $ 5.2 $ 4.3 |
Share-Based Compensation Plans
Share-Based Compensation Plans (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of share-based compensation expense included in net income | A summary of share-based compensation expense included in net income is as follows: Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 (In thousands) Grants of common shares and options $ 2,908 $ 2,523 $ 6,457 $ 6,052 Capitalized share-based compensation (381 ) (325 ) (698 ) (627 ) Share-based compensation expense $ 2,527 $ 2,198 $ 5,759 $ 5,425 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share | In the dilutive EPS calculation, dilutive stock options were calculated using the treasury stock method consistent with prior periods. There were no anti-dilutive stock options for the three and six months ended June 30, 2017 and 2016 . The conversions of downREIT operating partnership units and 5.417% Series 1 Cumulative Convertible Preferred Shares are anti-dilutive for all periods presented and accordingly, have been excluded from the weighted average common shares used to compute diluted EPS. Three Months Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 (In thousands, except per share data) NUMERATOR Income from continuing operations $ 59,137 $ 57,111 $ 117,029 $ 110,448 Less: Preferred share dividends (135 ) (135 ) (271 ) (271 ) Less: Income from continuing operations attributable to noncontrolling interests (1,660 ) (1,871 ) (3,432 ) (3,979 ) Less: Earnings allocated to unvested shares (251 ) (156 ) (468 ) (364 ) Income from continuing operations available for common shareholders 57,091 54,949 112,858 105,834 Gain on sale of real estate and change in control of interests, net 18,814 701 18,884 26,427 Net income available for common shareholders, basic and diluted $ 75,905 $ 55,650 $ 131,742 $ 132,261 DENOMINATOR Weighted average common shares outstanding—basic 72,001 70,797 71,928 70,270 Stock options 123 177 133 181 Weighted average common shares outstanding—diluted 72,124 70,974 72,061 70,451 EARNINGS PER COMMON SHARE, BASIC Continuing operations $ 0.79 $ 0.78 $ 1.57 $ 1.50 Gain on sale of real estate and change in control of interests, net 0.26 0.01 0.26 0.38 $ 1.05 $ 0.79 $ 1.83 $ 1.88 EARNINGS PER COMMON SHARE, DILUTED Continuing operations $ 0.79 $ 0.77 $ 1.57 $ 1.50 Gain on sale of real estate and change in control of interests, net 0.26 0.01 0.26 0.38 $ 1.05 $ 0.78 $ 1.83 $ 1.88 Income from continuing operations attributable to the Trust $ 57,477 $ 55,240 $ 113,597 $ 106,469 |
Business And Organization (Deta
Business And Organization (Details) | 6 Months Ended |
Jun. 30, 2017project | |
Nature Of Operations [Abstract] | |
Number of real estate properties | 99 |
Minimum percentage of taxable income distributed to shareholders | 90.00% |
Summary Of Significant Accoun26
Summary Of Significant Accounting Policies Revenue Recognition (Details) | Jun. 30, 2017condominiums |
Condominiums | Assembly Row and Pike & Rose | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Number of condominium units under construction | 221 |
Summary Of Significant Accoun27
Summary Of Significant Accounting Policies Recently Adopted Accounting Pronouncements (Details) - USD ($) $ in Thousands | Jan. 01, 2017 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cumulative impact to additional paid in capital and retained earnings | $ 100 | $ 0 | ||
Payments related to shares withheld for employee taxes | $ 4,077 | $ 4,371 | ||
Minimum | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Acquisition related costs in the past several years | $ 200 | |||
Maximum | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Acquisition related costs in the past several years | $ 2,400 |
Summary Of Significant Accoun28
Summary Of Significant Accounting Policies Consolidated Statement of Cash Flows - Supplemental Disclosures (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Accounting Policies [Abstract] | ||||
Total interest costs incurred | $ 59,304 | $ 54,803 | ||
Interest capitalized | (11,639) | (7,973) | ||
Interest expense | $ 23,907 | $ 23,101 | 47,665 | 46,830 |
Cash paid for interest, net of amounts capitalized | 47,995 | 45,577 | ||
Cash paid for income taxes | 341 | 250 | ||
Mortgage loans refinanced | 125,000 | 0 | ||
Mortgage loans assumed with acquisition | 0 | 34,385 | ||
DownREIT operating partnership units issued with acquisition of noncontrolling interest | 5,918 | 0 | ||
DownREIT operating partnership units redeemed for common shares | 2,569 | 18,164 | ||
Shares issued under dividend reinvestment plan | $ 1,036 | $ 1,047 |
Real Estate (Significant Acquis
Real Estate (Significant Acquisitions and Dispositions) (Details) $ in Millions | Jun. 28, 2017USD ($) | May 19, 2017USD ($)ft² | Apr. 04, 2017USD ($) | Mar. 31, 2017USD ($)ft² | Feb. 01, 2017USD ($)ft² | Jun. 30, 2017USD ($) | Jun. 28, 2017USD ($) | Jun. 30, 2017USD ($) |
Business Acquisitions [Line Items] | ||||||||
Document Period End Date | Jun. 30, 2017 | |||||||
Hastings Ranch Plaza | ||||||||
Business Acquisitions [Line Items] | ||||||||
Square footage | ft² | 274,000 | |||||||
Purchase price | $ 29.5 | |||||||
Hastings Ranch Plaza | Other Assets | Lease intangibles | ||||||||
Business Acquisitions [Line Items] | ||||||||
Net assets acquired | 21.5 | |||||||
Hastings Ranch Plaza | Other Liabilities | Lease liabilities | ||||||||
Business Acquisitions [Line Items] | ||||||||
Net assets acquired | $ 15.2 | |||||||
Riverpoint Center | ||||||||
Business Acquisitions [Line Items] | ||||||||
Square footage | ft² | 211,000 | |||||||
Purchase price | $ 107 | |||||||
Riverpoint Center | Other Assets | Above market leases | ||||||||
Business Acquisitions [Line Items] | ||||||||
Net assets acquired | 1 | |||||||
Riverpoint Center | Other Liabilities | ||||||||
Business Acquisitions [Line Items] | ||||||||
Net assets acquired allocated to below market leases | $ 12.3 | |||||||
Assembly Row | Land | ||||||||
Business Acquisitions [Line Items] | ||||||||
Number of ground lessees | 2 | |||||||
Proceeds from sale | $ 17.3 | $ 36 | ||||||
Gain on sale of real estate, net | $ 15.4 | |||||||
Assembly Row | Condominiums | ||||||||
Business Acquisitions [Line Items] | ||||||||
Gain on sale of real estate, net | $ 3.3 | $ 3.3 | ||||||
Taxes related to the sale of condominiums | 1.7 | 1.7 | ||||||
Receivable recognized on the sale of condominiums | $ 43.3 | $ 43.3 | ||||||
Mixed-use property located in Berkeley, California | ||||||||
Business Acquisitions [Line Items] | ||||||||
Square footage | ft² | 71,000 | |||||||
Gross value | $ 23.9 | |||||||
Ownership interest | 90.00% | |||||||
Contributions from noncontrolling interests | $ 2.4 | |||||||
Mixed-use property located in Berkeley, California | Other Assets | Above market leases | ||||||||
Business Acquisitions [Line Items] | ||||||||
Net assets acquired | 0.8 | |||||||
Mixed-use property located in Berkeley, California | Other Liabilities | ||||||||
Business Acquisitions [Line Items] | ||||||||
Net assets acquired allocated to below market leases | $ 0.3 |
Debt (Details)
Debt (Details) - USD ($) $ in Thousands | Jun. 23, 2017 | Jun. 05, 2017 | Jun. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2016 | Mar. 31, 2017 |
Debt Instrument [Line Items] | ||||||
Net proceeds from issuance of senior notes | $ 399,410 | $ 0 | ||||
Maximum borrowing capacity under revolving credit facility | $ 800,000 | 800,000 | ||||
Maximum amount outstanding under revolving credit facility | $ 344,000 | $ 344,000 | ||||
Weighted average interest rate, before amortization of debt fees | 1.80% | 1.80% | ||||
Weighted average borrowings outstanding | $ 252,100 | $ 173,200 | ||||
Outstanding balance of revolving credit facility | $ 0 | $ 0 | ||||
Mortgage loan | Plaza El Segundo | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 125,000 | $ 175,000 | ||||
Repayment of mortgage loan at par | $ 50,000 | |||||
Stated interest rate | 3.83% | |||||
Senior unsecured notes | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 400,000 | |||||
Net proceeds from issuance of senior notes | 399,400 | |||||
Senior unsecured notes | 3.25% Senior notes | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 300,000 | |||||
Stated interest rate | 3.25% | |||||
Note offering percent of principal amount | 99.083% | |||||
Debt yield to maturity percent | 3.358% | |||||
Senior unsecured notes | 4.50% Senior notes | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 100,000 | |||||
Stated interest rate | 4.50% | |||||
Note offering percent of principal amount | 105.76% | |||||
Debt yield to maturity percent | 4.143% |
Fair Value of Financial Instr31
Fair Value of Financial Instruments - Summary of Carrying Value and Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Mortgages payable and notes payable | Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions | ||
Fair value of long-term debt | $ 694,207 | $ 750,268 |
Mortgages payable and notes payable | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions | ||
Fair value of long-term debt | 702,636 | 760,260 |
Senior notes and debentures | Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions | ||
Fair value of long-term debt | 2,377,208 | 1,976,594 |
Senior notes and debentures | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions | ||
Fair value of long-term debt | $ 2,438,952 | $ 2,015,973 |
Fair Value Of Financial Instr32
Fair Value Of Financial Instruments (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2017USD ($)agreement | Jun. 30, 2017USD ($)agreement | Dec. 31, 2016USD ($) | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions | |||
Interest rate cash flow hedge to be reclassified within next 12 months, net | $ 1,000 | $ 1,000 | |
Other comprehensive income - change in value of interest rate swaps | 1,477 | ||
Interest expense reclassified from other comprehensive loss | 500 | 1,100 | |
Accumulated other comprehensive loss | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions | |||
Other comprehensive income - change in value of interest rate swaps | 400 | 1,477 | |
Fair Value, Measurements, Recurring | Accounts payable and accrued expenses | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions | |||
Fair value of interest rate swaps | 1,100 | 1,100 | |
Interest Rate Swap | Term loan | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions | |||
Term loan | $ 275,000 | $ 275,000 | |
Interest rate of variable portion of term loan | 1.72% | 1.72% | |
Interest Rate Swap | Fair Value, Measurements, Recurring | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions | |||
Number of interest rate swap agreements | agreement | 2 | 2 | |
Notional amount of interest rate swap agreements | $ 275,000 | $ 275,000 | |
Fair value of interest rate swaps | 1,100 | 1,100 | $ 2,577 |
Interest Rate Swap | Fair Value, Measurements, Recurring | Level 2 | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions | |||
Fair value of interest rate swaps | $ 1,100 | $ 1,100 | $ 2,577 |
Fair Value of Financial Instr33
Fair Value of Financial Instruments - Summary of Financial Liabilities Measured on a Recurring Basis (Details) - Interest Rate Swap - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Fair value of interest rate swaps | $ 1,100 | $ 2,577 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Fair value of interest rate swaps | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Fair value of interest rate swaps | 1,100 | 2,577 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Fair value of interest rate swaps | $ 0 | $ 0 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | Jan. 12, 2017 | Jun. 30, 2017 |
Commitments and Contingencies Disclosure [Abstract] | ||
downREIT operating partnership units, outstanding | 787,962 | |
downREIT operating partnership units outstanding, fair value | $ 99.6 | |
San Antonio Center | ||
Purchase option of non-controlling interest | ||
Payments to Acquire Outstanding Interest | $ 2.6 | |
Number of downREIT units issued in connection with purchase option | 44,195 |
Shareholders' Equity (Summary o
Shareholders' Equity (Summary of Dividends) (Details) - $ / shares | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Dividends [Abstract] | |||||
Series 1 Cumulative Convertible Preferred Shares Interest Rate | 5.417% | 5.417% | 5.417% | 5.417% | 5.417% |
Dividends declared per common share | $ 1.960 | $ 1.880 | |||
Dividends paid per common share | 1.960 | 1.880 | |||
Dividends declared per preferred share | 0.677 | 0.677 | |||
Dividends paid per preferred share | $ 0.677 | $ 0.677 |
Shareholders' Equity (Narrative
Shareholders' Equity (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Class of Stock [Line Items] | ||
Net cash proceeds of common stock | $ 17,390 | $ 245,221 |
At The Market Equity Program | ||
Class of Stock [Line Items] | ||
Aggregate offering price of common shares | $ 400,000 | |
Common shares issued | 98,658 | |
Weighted average price per common share | $ 137.90 | |
Net cash proceeds of common stock | $ 13,400 | |
Remaining capacity to issue | 357,300 | |
At The Market Equity Program | Commissions | ||
Class of Stock [Line Items] | ||
Payments of stock issuance costs | 100 | |
At The Market Equity Program | Other offering costs | ||
Class of Stock [Line Items] | ||
Payments of stock issuance costs | $ 100 |
Components Of Rental Income (Sc
Components Of Rental Income (Schedule Of Principal Components Of Rental Income) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Cost reimbursement | $ 39,877 | $ 36,637 | $ 81,395 | $ 78,439 |
Percentage rents | 2,397 | 2,482 | 5,220 | 5,551 |
Other | 4,255 | 4,243 | 8,715 | 8,645 |
Total rental income | 204,246 | 192,935 | 408,693 | 388,243 |
Retail and Commercial | ||||
Minimum rents | 144,276 | 137,432 | 286,419 | 272,018 |
Residential | ||||
Minimum rents | $ 13,441 | $ 12,141 | $ 26,944 | $ 23,590 |
Components Of Rental Income (38
Components Of Rental Income (Schedule Of Minimum Rent) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Minimum Rent [Line Items] | ||||
Straight-line rents | $ 3.8 | $ 2.7 | $ 7.4 | $ 4.7 |
Amortization of above market leases | ||||
Minimum Rent [Line Items] | ||||
Amortization of above and below market leases | (1.4) | (1.7) | (2.8) | (3.6) |
Amortization of below market leases | ||||
Minimum Rent [Line Items] | ||||
Amortization of above and below market leases | $ 2.7 | $ 2.1 | $ 5.2 | $ 4.3 |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Share-based Compensation, Allocation and Classification in Financial Statements [Abstract] | ||||
Grants of common shares and options | $ 2,908 | $ 2,523 | $ 6,457 | $ 6,052 |
Capitalized share-based compensation | (381) | (325) | (698) | (627) |
Share-based compensation expense | $ 2,527 | $ 2,198 | $ 5,759 | $ 5,425 |
Earnings Per Share (Narrative)
Earnings Per Share (Narrative) (Details) - shares | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |||||
Weighted average unvested shares outstanding | 200,000 | 200,000 | 200,000 | 200,000 | |
Anti-dilutive stock options | 0 | 0 | 0 | 0 | |
Cumulative convertible preferred shares, dividend rate | 5.417% | 5.417% | 5.417% | 5.417% | 5.417% |
Earnings Per Share (Schedule Of
Earnings Per Share (Schedule Of Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
INCOME FROM CONTINUING OPERATIONS | $ 59,137 | $ 57,111 | $ 117,029 | $ 110,448 |
Less: Preferred share dividends | (135) | (135) | (271) | (271) |
Less: Income from continuing operations attributable to noncontrolling interests | (1,660) | (1,871) | (3,432) | (3,979) |
Less: Earnings allocated to unvested shares | (251) | (156) | (468) | (364) |
Income from continuing operations available for common shareholders | 57,091 | 54,949 | 112,858 | 105,834 |
Gain on sale of real estate and change in control of interests, net | 18,814 | 701 | 18,884 | 26,427 |
Net income available for common shareholders, basic and diluted | $ 75,905 | $ 55,650 | $ 131,742 | $ 132,261 |
Weighted average common shares outstanding—basic | 72,001 | 70,797 | 71,928 | 70,270 |
Stock options | 123 | 177 | 133 | 181 |
Weighted average common shares outstanding—diluted | 72,124 | 70,974 | 72,061 | 70,451 |
Continuing operations | $ 0.79 | $ 0.78 | $ 1.57 | $ 1.50 |
Gain on sale of real estate and change in control of interests, net | 0.26 | 0.01 | 0.26 | 0.38 |
Earnings per common share, basic | 1.05 | 0.79 | 1.83 | 1.88 |
Continuing operations | 0.79 | 0.77 | 1.57 | 1.50 |
Gain on sale of real estate and change in control of interests, net | 0.26 | 0.01 | 0.26 | 0.38 |
Earnings per common share, diluted | $ 1.05 | $ 0.78 | $ 1.83 | $ 1.88 |
Income from continuing operations attributable to the Trust | $ 57,477 | $ 55,240 | $ 113,597 | $ 106,469 |