Document And Entity Information
Document And Entity Information | 9 Months Ended |
Sep. 30, 2016shares | |
Document and Entity Information [Abstract] | |
Entity Registrant Name | TIAA REAL ESTATE ACCOUNT |
Document Type | 10-Q |
Current Fiscal Year End Date | --12-31 |
Entity Common Stock, Shares Outstanding (in shares) | 0 |
Amendment Flag | false |
Entity Central Index Key | 946,155 |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | No |
Entity Filer Category | Non-accelerated Filer |
Entity Well-known Seasoned Issuer | No |
Document Period End Date | Sep. 30, 2016 |
Document Fiscal Year Focus | 2,016 |
Document Fiscal Period Focus | Q3 |
CONSOLIDATED STATEMENTS OF ASSE
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES - USD ($) shares in Millions, $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 | |
Investments, at fair value: | |||
Real estate properties (cost: $12,649.3 and $12,289.0) | $ 15,208.7 | $ 14,606.2 | |
Real estate joint ventures and limited partnerships (cost: $4,295.0 and $3,171.4) | 5,448.9 | 4,213.2 | |
Marketable securities: | |||
Real estate related (cost: $876.7 and $859.5) | [1] | 1,128.1 | 1,024.4 |
Other (cost: $4,411.5 and $4,207.7) | 4,412.5 | 4,207.2 | |
Loans receivable (cost: $169.0 and $100.0) | 169.7 | 100.6 | |
Total investments (cost: $22,401.5 and $20,627.6) | 26,367.9 | 24,151.6 | |
Cash and cash equivalents | 29.2 | 11.9 | |
Due from investment manager | 10.6 | 5.7 | |
Other | [2] | 351.6 | 230.2 |
TOTAL ASSETS | 26,759.3 | 24,399.4 | |
LIABILITIES | |||
Mortgage loans payable, at fair value—Note 5 (principal outstanding: $2,292.5 and $1,763.7) | 2,378.1 | 1,794.4 | |
Accrued real estate property expenses | 206 | 191.5 | |
Payable for collateral for securities loaned | 110.8 | 0 | |
Other | 52.9 | 53.5 | |
TOTAL LIABILITIES | 2,747.8 | 2,039.4 | |
COMMITMENTS AND CONTINGENCIES | |||
NET ASSETS | |||
Accumulation Fund | 23,521 | 21,898.6 | |
Annuity Fund | 490.5 | 461.4 | |
TOTAL NET ASSETS | $ 24,011.5 | $ 22,360 | |
NUMBER OF ACCUMULATION UNITS OUTSTANDING (in shares) | 62.4 | 60.4 | |
NET ASSET VALUE, PER ACCUMULATION UNIT (in dollars per share) | $ 376.906 | $ 362.773 | |
[1] | Includes securities loaned of $108.6 million. | ||
[2] | Includes cash collateral for securities loaned of $110.8 million. |
CONSOLIDATED STATEMENTS OF ASS3
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES (Parenthetical) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Securities loaned | $ 108.6 | |
Payable for collateral for securities loaned | 110.8 | $ 0 |
Real estate properties at cost | 12,649.3 | 12,289 |
Real estate joint ventures and limited partnerships at cost | 4,295 | 3,171.4 |
Real estate related marketable securities at cost | 876.7 | 859.5 |
Other marketable securities at cost | 4,411.5 | 4,207.7 |
Loans Receivable at cost | 169 | 100 |
Cost of total investments | 22,401.5 | 20,627.6 |
Principal outstanding on mortgage loans payable | $ 2,292.5 | $ 1,763.7 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Real estate income, net: | ||||
Rental income | $ 257.4 | $ 236.1 | $ 755.9 | $ 676.4 |
Real estate property level expenses and taxes: | ||||
Operating expenses | 54.8 | 52.5 | 163.5 | 154.5 |
Real estate taxes | 40.4 | 36.7 | 116.9 | 107.4 |
Interest expense | 22.4 | 18.8 | 63.3 | 63.6 |
Total real estate property level expenses and taxes | 117.6 | 108 | 343.7 | 325.5 |
Real estate income, net | 139.8 | 128.1 | 412.2 | 350.9 |
Income from real estate joint ventures and limited partnerships | 33.5 | 36.2 | 111.8 | 104.4 |
Interest | 6.3 | 3.1 | 17.8 | 6.4 |
Dividends | 9.2 | 13 | 19.9 | 35.2 |
TOTAL INVESTMENT INCOME | 188.8 | 180.4 | 561.7 | 496.9 |
Expenses: | ||||
Investment management charges | 17.6 | 17.6 | 51.8 | 51.4 |
Administrative charges | 17 | 13.1 | 48.4 | 39.7 |
Distribution charges | 7.2 | 6.1 | 21.3 | 17 |
Mortality and expense risk charges | 0.3 | 0.3 | 0.9 | 0.8 |
Liquidity guarantee charges | 10.2 | 8.1 | 28.1 | 23.4 |
TOTAL EXPENSES | 52.3 | 45.2 | 150.5 | 132.3 |
INVESTMENT INCOME, NET | 136.5 | 135.2 | 411.2 | 364.6 |
Net realized gain (loss) on investments: | ||||
Real estate properties | 16.4 | 0 | 26.5 | 216.9 |
Real estate joint ventures and limited partnerships | 0.2 | (0.2) | 0.4 | 152.5 |
Marketable securities | 3.1 | 4.5 | 21.6 | 46.1 |
Net realized gain on investments | 19.7 | 4.3 | 48.5 | 415.5 |
Net change in unrealized appreciation (depreciation) on: | ||||
Real estate properties | 36.9 | 166.5 | 242.2 | 407.7 |
Real estate joint ventures and limited partnerships | 24.3 | 105.7 | 152.3 | 262.7 |
Marketable securities | (26) | (0.8) | 84.2 | (162.6) |
Loans receivable | 0.1 | 0.1 | 0.1 | 0.1 |
Mortgage loans payable | (29.1) | 11.4 | (54.8) | 3.5 |
Net change in unrealized appreciation on investments and mortgage loans payable | 6.2 | 282.9 | 424 | 511.4 |
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS AND MORTGAGE LOANS PAYABLE | 25.9 | 287.2 | 472.5 | 926.9 |
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS | $ 162.4 | $ 422.4 | $ 883.7 | $ 1,291.5 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
FROM OPERATIONS | ||||
Investment income, net | $ 136.5 | $ 135.2 | $ 411.2 | $ 364.6 |
Net realized gain on investments | 19.7 | 4.3 | 48.5 | 415.5 |
Net change in unrealized appreciation on investments and mortgage loans payable | 6.2 | 282.9 | 424 | 511.4 |
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS | 162.4 | 422.4 | 883.7 | 1,291.5 |
FROM PARTICIPANT TRANSACTIONS | ||||
Premiums | 757.8 | 712.7 | 2,349.2 | 2,067.4 |
Annuity payments | (10.3) | (9.3) | (30.3) | (26.9) |
Withdrawals and death benefits | (576.6) | (527.2) | (1,551.1) | (1,466.5) |
NET INCREASE IN NET ASSETS RESULTING FROM PARTICIPANT TRANSACTIONS | 170.9 | 176.2 | 767.8 | 574 |
NET INCREASE IN NET ASSETS | 333.3 | 598.6 | 1,651.5 | 1,865.5 |
NET ASSETS | ||||
Beginning of period | 23,678.2 | 21,095.9 | 22,360 | 19,829 |
End of period | $ 24,011.5 | $ 21,694.5 | $ 24,011.5 | $ 21,694.5 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net increase in net assets resulting from operations | $ 883.7 | $ 1,291.5 |
Adjustments to reconcile net changes in net assets resulting from operations to net cash used in operating activities: | ||
Net realized gain on investments | (48.5) | (415.5) |
Net change in unrealized appreciation on investments and mortgage loans payable | (424) | (511.4) |
Purchase of real estate properties | (378) | (946.4) |
Capital improvements on real estate properties | (125.2) | (114.9) |
Proceeds from sale of real estate properties | 152.9 | 421.4 |
Purchases of long term investments | (1,134) | (367.1) |
Proceeds from long term investments | 51.6 | 549.6 |
Increase in loans receivable | (69) | (100) |
Increase in other investments | (203.8) | (61.9) |
Change in due from investment manager | (4.9) | (4.2) |
Increase in other assets | (121.4) | (32.4) |
Increase in other liabilities | 141.3 | 25.1 |
NET CASH USED IN OPERATING ACTIVITIES | (1,279.3) | (266.2) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Mortgage loan proceeds received | 563.5 | 0 |
Payments of mortgage loans | (34.7) | (338.6) |
Premiums | 2,349.2 | 2,067.4 |
Annuity payments | (30.3) | (26.9) |
Withdrawals and death benefits | (1,551.1) | (1,466.5) |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 1,296.6 | 235.4 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 17.3 | (30.8) |
CASH AND CASH EQUIVALENTS | ||
Beginning of period | 11.9 | 36.5 |
End of period | 29.2 | 5.7 |
SUPPLEMENTAL DISCLOSURES: | ||
Cash paid for interest | 61.6 | 64.8 |
Loan assignment as part of a real estate disposition | 0 | 200 |
Conversion of note receivable | $ 0 | $ 100.6 |
Organization and Significant Ac
Organization and Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Organization and Significant Accounting Policies | Organization and Significant Accounting Policies Business: The TIAA Real Estate Account (“Account”) is an insurance separate account of Teachers Insurance and Annuity Association of America (“TIAA”) and was established by resolution of TIAA’s Board of Trustees (the “Board”) on February 22, 1995, under the insurance laws of the State of New York, for the purpose of funding variable annuity contracts issued by TIAA. The Account offers individual and group accumulating annuity contracts (with contributions made on a pre-tax or after-tax basis), as well as individual lifetime and term-certain variable payout annuity contracts (including the payment of death benefits to beneficiaries). Investors are entitled to transfer funds to or from the Account, and make withdrawals from the Account on a daily basis, under certain circumstances. Funds invested in the Account for each category of contract are expressed in terms of units, and unit values will fluctuate depending on the Account’s performance. The investment objective of the Account is to seek favorable long-term returns primarily through rental income and capital appreciation from real estate and real estate-related investments owned by the Account. The Account holds real estate properties directly and through subsidiaries wholly owned by TIAA for the benefit of the Account. The Account also holds limited interests in real estate joint ventures and limited partnerships, as well as investments in loans receivable with commercial real estate properties as underlying collateral. Additionally, the Account invests in real estate-related and non-real estate-related publicly traded securities, cash and other instruments to maintain adequate liquidity levels for operating expenses, capital expenditures and to fund benefit payments (withdrawals, transfers and related transactions). The consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America, which requires the use of estimates made by management. Actual results may vary from those estimates and such differences may be material. The following is a summary of the significant accounting policies of the Account. Basis of Presentation: The accompanying consolidated financial statements include the Account and those subsidiaries wholly owned by TIAA for the benefit of the Account. All significant intercompany accounts and transactions between the Account and such subsidiaries have been eliminated. The Accumulation Unit Value (“AUV”) used for financial reporting purposes may differ from the AUV used for processing transactions. The AUV used for financial reporting purposes includes security and participant transactions effective through the period end date to which this report relates. Total return is computed based on the AUV used for processing transactions. Determination of Investments at Fair Value: The Account reports all investments at fair value in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 946, Financial Services—Investment Companies. Further, in accordance with the adoption of the fair value option allowed under ASC 825, Financial Instruments , and at the election of Account management, mortgage loans payable are reported at fair value. The FASB has defined fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The following is a description of the valuation methodologies used to determine the fair value of the Account’s investments and investment related mortgage loans payable. Valuation of Real Estate Properties —Investments in real estate properties are stated at fair value, as determined in accordance with policies and procedures reviewed by the Investment Committee of the Board and in accordance with the responsibilities of the Board as a whole. Accordingly, the Account does not record depreciation. Determination of fair value involves significant levels of judgment because the actual fair value of real estate can be determined only by negotiation between the parties in a sales transaction. The Account’s primary objective when valuing its real estate investments will be to produce a valuation that represents a reasonable estimate of the fair value of its investments. Implicit in the Account’s definition of fair value, are the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: • Buyer and seller are typically motivated; • Both parties are well informed or well advised, and acting in what they consider their best interests; • A reasonable time is allowed for exposure in the open market; • Payment is made in terms of cash or in terms of financial arrangements comparable thereto; and • The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. Property and investment values are affected by, among other things, the availability of capital, occupancy rates, rental rates, and interest and inflation rates. As a result, determining real estate and investment values involves many assumptions. Key inputs and assumptions include rental income and expense amounts, related rental income and expense growth rates, capital expenditures, discount rates and capitalization rates. Valuation techniques include discounted cash flow analysis, prevailing market capitalization rates or multiples applied to earnings from the property, analysis of recent comparable sales transactions, actual sale negotiations and bona fide purchase offers received from third parties. Amounts ultimately realized from each investment may vary significantly from the fair value presented. Real estate properties owned by the Account are initially valued based on an independent third party appraisal, as reviewed by TIAA’s internal appraisal staff and as applicable by the Account’s independent fiduciary at the time of the closing of the purchase. Such initial valuation may result in a potential unrealized gain or loss reflecting the difference between an investment’s fair value (i.e., exit price) and its cost basis (which is inclusive of transaction costs). Subsequently, each property is appraised each quarter by an independent third party appraiser, reviewed by TIAA’s internal appraisal staff and as applicable the Account’s independent fiduciary. In general, the Account obtains appraisals of its real estate properties spread out throughout the quarter, which is intended to result in appraisal adjustments, and thus, adjustments to the valuations of its holdings (to the extent such adjustments are made) that happen regularly throughout each quarter and not on one specific day or month in each period. Further, management reserves the right to order an appraisal and/or conduct another valuation outside of the normal quarterly process when facts or circumstances at a specific property change. For example, under certain circumstances a valuation adjustment could be made when the Account receives a bona fide bid for the sale of a property held within the Account or one of the Account’s joint ventures. Adjustments may be made for events or circumstances indicating an impairment of a tenant’s ability to pay amounts due to the Account under a lease (including due to a bankruptcy filing of that tenant). Alternatively, adjustments may be made to reflect the execution or renewal of a significant lease. Also, adjustments may be made to reflect factors (such as sales values for comparable properties or local employment rate) bearing uniquely on a particular region in which the Account holds properties. TIAA’s internal appraisal staff oversees the entire appraisal process, in conjunction with the Account’s independent fiduciary (the independent fiduciary is more fully described in the following paragraph). Any differences in the conclusions of TIAA’s internal appraisal staff and the independent appraiser will be reviewed by the independent fiduciary, which will make a final determination on the matter (which may include ordering a subsequent independent appraisal). The independent fiduciary, RERC, LLC, has been appointed by a special subcommittee of the Investment Committee of the Board to, among other things, oversee the appraisal process. The independent fiduciary must approve all independent appraisers used by the Account. All appraisals are performed in accordance with Uniform Standards of Professional Appraisal Practices, the real estate appraisal industry standards created by The Appraisal Foundation. Real estate appraisals are estimates of property values based on a professional’s opinion. Appraisals of properties held outside of the U.S. are performed in accordance with industry standards commonly applied in the applicable jurisdiction. These independent appraisers are always expected to be MAI-designated members of the Appraisal Institute (or its European equivalent, Royal Institute of Chartered Surveyors) and state certified appraisers from national or regional firms with relevant property type experience and market knowledge. Under the Account’s current procedures, each independent appraisal firm will be rotated off of a particular property at least every three years, although such appraisal firm may perform appraisals of other Account properties subsequent to such rotation. Also, the independent fiduciary can require additional appraisals if factors or events have occurred that could materially change a property’s value (including those identified previously) and such change is not reflected in the quarterly valuation review, or otherwise to ensure that the Account is valued appropriately. The independent fiduciary must also approve any valuation change of real estate-related assets where a property’s value changed by more than 6% from the most recent independent annual appraisal, or if the value of the Account would change by more than 4% within any calendar quarter or more than 2% since the prior calendar month. When a real estate property is subject to a mortgage, the property is valued independently of the mortgage and the property and mortgage fair values are reported separately (see Valuation of Mortgage Loans Payable ). The independent fiduciary reviews and approves all mortgage valuation adjustments before such adjustments are recorded by the Account. The Account continues to use the revised value for each real estate property and mortgage loan payable to calculate the Account’s daily net asset value until the next valuation review or appraisal. Valuation of Real Estate Joint Ventures —Real estate joint ventures are stated at the fair value of the Account’s ownership interests of the underlying entities. The Account’s ownership interests are valued based on the fair value of the underlying real estate, any related mortgage loans payable, and other factors, such as ownership percentage, ownership rights, buy/sell agreements, distribution provisions and capital call obligations. Upon the disposition of all real estate investments by an investee entity, the Account will continue to state its equity in the remaining net assets of the investee entity during the wind down period, if any, which occurs prior to the dissolution of the investee entity. Valuation of Real Estate Limited Partnerships —Limited partnership interests are stated at the fair value of the Account’s ownership in the partnership. Such limited partnership interests are recorded based upon the changes in the net asset values of the limited partnerships as determined from the financial statements of the limited partnerships when received by the Account. Prior to the receipt of the financial statements from the limited partnerships, the Account estimates the value of its interest in good faith and will from time to time seek input from the issuer or the sponsor of the investments. Since market quotations are not readily available, the limited partnership interests are valued at fair value as determined in good faith by management under the direction of the Investment Committee of the Board and in accordance with the responsibilities of the Board as a whole. Valuation of Marketable Securities —Equity securities listed or traded on any national market or exchange are valued at the last sale price as of the close of the principal securities market or exchange on which such securities are traded or, if there is no sale, at the mean of the last bid and asked prices on such market or exchange, exclusive of transaction costs. Debt securities with readily available market quotations, other than money market instruments, are generally valued at the most recent bid price or the equivalent quoted yield for such securities (or those of comparable maturity, quality and type). Debt securities for which market quotations are not readily available, are valued at fair value as determined in good faith by the Investment Committee of the Board and in accordance with the responsibilities of the Board as a whole. Short-term investments are valued in the same manner as debt securities, as described above. Money market instruments are valued at amortized cost, which approximates fair value. Equity and fixed income securities traded on a foreign exchange or in foreign markets are valued using their closing values under the valuation methods generally accepted in the country where traded, as of the valuation date. This value is converted to U.S. dollars at the exchange rate in effect on the valuation day. Under certain circumstances (for example, if there are significant movements in the U.S. markets and there is an expectation the securities traded on foreign markets will adjust based on such movements when the foreign markets open the next day), the Account may adjust the value of equity or fixed income securities that trade on a foreign exchange or market after the foreign exchange or market has closed. Valuation of Loans Receivable —Loans receivable are stated at fair value and are initially valued at the face amount of the loan funding. Subsequently, loans receivable are valued at least quarterly by TIAA’s internal valuation department based on market factors, such as market interest rates and spreads for comparable loans, the liquidity for loans of similar characteristics, the performance of the underlying collateral (such as the loan-to-value ratio and the cash flow of the underlying collateral) and the credit quality of the counterparty. The independent fiduciary reviews and approves all loan receivable valuation adjustments before such adjustments are recorded by the Account. The Account continues to use the revised value for each loan receivable to calculate the Account’s daily net asset value until the next valuation review. Valuation of Mortgage Loans Payable —Mortgage loans payable are stated at fair value. The estimated fair values of mortgage loans payable are based on the amount at which the liability could be transferred to a third party exclusive of transaction costs. Mortgage loans payable are valued internally by TIAA’s internal valuation department, as reviewed by the Account’s independent fiduciary, at least quarterly based on market factors, such as market interest rates and spreads for comparable loans, the performance of the underlying collateral (such as the loan-to-value ratio and the cash flow of the underlying collateral), the liquidity for mortgage loans of similar characteristics, the maturity date of the loan and the return demands of the market. See Note 4—Assets and Liabilities Measured at Fair Value on a Recurring Basis for further discussion and disclosure regarding the determination of the fair value of the Account’s investments. Foreign Currency Transactions and Translation: Portfolio investments and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rates prevailing at the end of the period. Purchases and sales of securities, income receipts and expense payments made in foreign currencies are translated into U.S. dollars at the exchange rates prevailing on the respective dates of the transactions. The effect of any changes in foreign currency exchange rates on portfolio investments and mortgage loans payable are included in net realized and unrealized gains and losses on real estate properties and mortgage loans payable. Net realized gains and losses on foreign currency transactions include disposition of foreign currencies, and currency gains and losses between the accrual and receipt dates of portfolio investment income and between the trade and settlement dates of portfolio investment transactions. Accumulation and Annuity Funds: The accumulation fund represents the net assets attributable to participants in the accumulation phase of their investment (“Accumulation Fund”). The annuity fund represents the net assets attributable to the participants currently receiving annuity payments (“Annuity Fund”). The net increase or decrease in net assets from investment operations is apportioned between the funds based upon their relative daily net asset values. Once an Account participant begins receiving lifetime annuity income benefits, payment levels cannot be reduced as a result of the Account’s actual mortality experience. In addition, the contracts pursuant to which the Account is offered are required to stipulate the maximum expense charge for all Account level expenses that can be assessed, which is not to exceed 2.5% of average net assets per year. The Account pays a fee to TIAA to assume mortality and expense risks. Accounting for Investments: The investments held by the Account are accounted for as follows: Real Estate Properties —Rent from real estate properties consists of all amounts earned under tenant operating leases, including base rent, recoveries of real estate taxes and other expenses and charges for miscellaneous services provided to tenants. Rental income is recognized in accordance with the billing terms of the lease agreements. The Account bears the direct expenses of the real estate properties owned. These expenses include, but are not limited to, fees to local property management companies, property taxes, utilities, maintenance, repairs, insurance, and other operating and administrative costs. An estimate of the net operating income earned from each real estate property is accrued by the Account on a daily basis and such estimates are adjusted when actual operating results are determined. Real Estate Joint Ventures —The Account has limited ownership interests in various real estate joint ventures (collectively, the “joint ventures”). The Account records its contributions as increases to its investments in the joint ventures, and distributions from the joint ventures are treated as income within income from real estate joint ventures and limited partnerships in the Account’s consolidated statements of operations. Distributions that are identified as returns of capital are recorded as a reduction to the cost basis of the investment, whereas distributions identified as capital gains or losses are recorded as realized gains or losses. Income from the joint ventures is recorded based on the Account’s proportional interest of the income distributed by the joint ventures. Income earned but not yet distributed to the Account by the joint ventures is recorded as unrealized gains and losses. Limited Partnerships —The Account has limited ownership interests in various private real estate funds (primarily limited partnerships) and a private real estate investment trust (collectively, the “limited partnerships”). The Account records its contributions as increases to the investments, and distributions from the investments are treated as income within income from real estate joint ventures and limited partnerships in the Account’s consolidated statements of operations. Distributions that are identified as returns of capital are recorded as a reduction to the cost basis of the investment, whereas distributions identified as capital gains or losses are recorded as realized gains or losses. Unrealized gains and losses are recorded based upon the changes in the net asset values of the limited partnerships as determined from the financial statements of the limited partnerships when received by the Account. Prior to the receipt of the financial statements from the limited partnerships, the Account estimates the value of its interest in good faith and will from time to time seek input from the issuer or the sponsor of the investments. Changes in value based on such estimates are recorded by the Account as unrealized gains and losses. Marketable Securities —Transactions in marketable securities are accounted for as of the date the securities are purchased or sold (trade date). Interest income is recorded as earned. Dividend income is recorded on the ex-dividend date within dividend income. Dividends that are identified as returns of capital are recorded as a reduction to the cost basis of the investment, whereas dividends identified as capital gains or losses are recorded as realized gains or losses. Realized gains and losses on securities transactions are accounted for on the specific identification method. Loans Receivable —The Account has ownership interest in loans receivable. Interest income from the loans receivable is recognized using the effective interest method over the expected life of the loan. Realized and Unrealized Gains and Losses —Realized gains and losses are recorded at the time an investment is sold or a distribution is received in relation to an investment sale from a joint venture or limited partnership. Real estate transactions are accounted for as of the date on which the purchase or sale transactions for the real estate properties close (settlement date). The Account recognizes a realized gain on the sale of a real estate property to the extent that the contract sales price exceeds the cost-to-date of the property being sold. A realized loss occurs when the cost-to-date exceeds the sales price. Unrealized gains and losses are recorded as the fair values of the Account’s investments are adjusted, and as discussed within the Real Estate Joint Ventures and Limited Partnerships sections above. Net Assets —The Account’s net assets as of the close of each valuation day are valued by taking the sum of: • the value of the Account’s cash; cash equivalents, and short-term and other debt instruments; • the value of the Account’s other securities and other non-real estate assets; • the value of the individual real properties (based on the most recent valuation of that property) and other real estate-related investments owned by the Account; • an estimate of the net operating income accrued by the Account from its properties, other real estate-related investments and non-real estate-related investments (including short-term marketable securities) since the end of the prior valuation day; and • actual net operating income earned from the Account’s properties, other real estate-related investments and non-real estate-related investments (but only to the extent any such item of income differs from the estimated income accrued for on such investments), and then reducing the sum by liabilities held within the Account, including the daily investment management fee, administration and distribution fees, mortality and expense fee, liquidity guarantee fee, and certain other expenses attributable to operating the Account. Daily estimates of net operating income are adjusted to reflect actual net operating income on a monthly basis, at which time such adjustments (if any) are reflected in the Account’s unit value. After the end of every quarter, the Account reconciles the amount of expenses deducted from the Account (which is established in order to approximate the costs that the Account will incur) with the expenses the Account actually incurred. If there is a difference, the Account adds it to or deducts it from the Account in equal daily installments over the remaining days of the following quarter. Material differences may be repaid in the current calendar quarter. The Account’s at-cost deductions are based on projections of Account assets and overall expenses, and the size of any adjusting payments will be directly affected by the difference between management’s projections and the Account’s actual assets or expenses. Income from Securities Lending: The Account may lend securities to qualified borrowers to generate additional income. When loaning securities, the Account retains the benefits of owning the securities, including the economic equivalent of dividends or interest generated by the securities. Cash collateral received for securities on loan is maintained exclusively in an interest-bearing deposit account. All income generated by the securities lending program is reflected within interest income on the consolidated statements of operations. Cash and Cash Equivalents: Cash and cash equivalents are balances held by the Account in bank deposit accounts which, at times, exceed federally insured limits. The Account’s management monitors these balances to mitigate the exposure of risk due to concentration and has not experienced any losses from such concentration. Other Assets and Other Liabilities: Other assets and other liabilities consist of operating assets and liabilities utilized and held at each individual real estate property investment. Other assets consist of, amongst other items, cash, tenant receivables and prepaid expenses; whereas other liabilities primarily consist of security deposits. Other assets also include cash collateral held for securities on loan. Federal Income Taxes: Based on provisions of the Internal Revenue Code, Section 817, the Account is taxed as a segregated asset account of TIAA and as such, the Account incurs no material federal income tax attributable to the net investment activity of the Account. The Account’s federal income tax return is generally subject to examination for a period of three years after filed. State and local tax returns may be subject to examination for an additional period of time depending on the jurisdiction. Management has analyzed the Account’s tax positions taken for all open federal income tax years and has concluded that no provision for federal income tax is required in the Account’s consolidated financial statements. Restricted Cash: The Account held $45.1 million and $50.9 million as of September 30, 2016 and December 31, 2015 , respectively, in escrow accounts for security deposits, as required by certain states, as well as property taxes, insurance, and various other property related matters as required by certain creditors related to outstanding mortgage loans payable collateralized by certain real estate investments. These amounts are recorded within other assets on the consolidated statements of assets and liabilities. See Note 5—Mortgage Loans Payable for additional information regarding the Account’s outstanding mortgage loans payable. Changes in Net Assets: Premiums include premiums paid by existing accumulation unit holders in the Account and transfers into the Account. Withdrawals and death benefits include withdrawals out of the Account which include transfers out of the Account and required minimum distributions. Due to/from Investment Manager: Due to/from investment manager represents amounts that are to be paid or received by TIAA on behalf of the Account. Amounts generally are paid or received by the Account within one or two business days and no interest is contractually charged on these amounts. New Accounting Pronouncements: In January 2016, the FASB issued ASU 2016-01 Financial Instruments (Topic 825)—Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”). This ASU amends, amongst other items, certain aspects of the recognition, measurement, presentation, and disclosure of financial instruments. These amendments are effective for public business entities for fiscal years and interim periods within those fiscal years beginning after December 15, 2017. Management is currently assessing the impact of ASU 2016-01 on the Account’s Consolidated Financial Statements. In February 2016, the FASB issued ASU 2016-02 Leases (Topic 842) (“ASU 2016-02”) which will supersede Topic 840, Leases. This ASU applies to all entities that enter into a lease. Lessees will be required to report assets and liabilities that arise from leases. Lessor accounting is expected to remain unchanged except in certain circumstances. This ASU is effective for public business entities for fiscal years beginning after December 15, 2018, including all interim periods within those fiscal years. Management is currently assessing the impact of ASU 2016-02 on the Account’s Consolidated Financial Statements. In August 2016, the FASB issued Accounting Standards Update 2016-15, Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”). ASU 2016-15 clarifies how to present cash receipts and cash payments for certain activity in the Statement of Cash Flows. These amendments are effective for public business entities within those fiscal years beginning after December 31, 2017, and interim periods within those fiscal years. Management is currently assessing the impact of ASU 2016-15 on the Account's Consolidated Financial Statements. |
Management Agreements, Arrangem
Management Agreements, Arrangements and Related Party Transactions | 9 Months Ended |
Sep. 30, 2016 | |
Management Agreements And Arrangements [Abstract] | |
Management Agreements, Arrangements and Related Party Transactions | Management Agreements, Arrangements and Related Party Transactions Investment advisory services for the Account are provided by TIAA employees, under the direction of the Board and its Investment Committee, pursuant to investment management procedures adopted by TIAA for the Account. TIAA’s investment management decisions for the Account are subject to review by the Account’s independent fiduciary. TIAA also provides various portfolio accounting and related services for the Account. The Account is a party to the Distribution Agreement for the Contracts Funded by the TIAA Real Estate Account (the “Distribution Agreement”), dated January 1, 2008, by and among TIAA, for itself and on behalf of the Account, and TIAA-CREF Individual and Institutional Services, LLC (“Services”), a wholly owned subsidiary of TIAA, a registered broker-dealer and a member of the Financial Industry Regulatory Authority. Pursuant to the Distribution Agreement, Services performs distribution services for the Account which include, among other things, (i) distribution of annuity contracts issued by TIAA and funded by the Account, (ii) advising existing annuity contract owners in connection with their accumulations and (iii) helping employers implement and manage retirement plans. In addition, TIAA performs administrative functions for the Account, which include, among other things, (i) maintaining accounting records and performing accounting services, (ii) receiving and allocating premiums, (iii) calculating and making annuity payments, (iv) processing withdrawal requests, (v) providing regulatory compliance and reporting services, (vi) maintaining the Account’s records of contract ownership and (vii) otherwise assisting generally in all aspects of the Account’s operations. Both distribution services (pursuant to the Distribution Agreement) and administrative services are provided to the Account by Services and TIAA, as applicable, on an at-cost basis. The Distribution Agreement is terminable by either party upon 60 days written notice and terminates automatically upon any assignment thereof. TIAA and Services provide investment management, administrative and distribution services at cost. TIAA and Services receive payments from the Account on a daily basis according to formulas established each year and adjusted periodically with the objective of keeping the payments as close as possible to the Account’s expenses actually incurred. Any differences between actual expenses and the amounts paid by the Account are adjusted quarterly. TIAA also provides a liquidity guarantee to the Account, for a fee, to ensure that sufficient funds are available to meet participant transfer and cash withdrawal requests in the event that the Account’s cash flows and liquid investments are insufficient to fund such requests. TIAA ensures sufficient funds are available for such transfer and withdrawal requests by purchasing accumulation units of the Account. To the extent TIAA owns accumulation units issued pursuant to the liquidity guarantee, the independent fiduciary monitors and oversees, among other things, TIAA’s ownership interest in the Account and may require TIAA to eventually redeem some of its units, particularly when the Account has un-invested cash or liquid investments available. TIAA also receives a fee for assuming certain mortality and expense risks. The expenses for the services noted above that are provided to the Account by TIAA and Services are identified in the accompanying consolidated statements of operations and are reflected in Note 6—Financial Highlights. |
Credit Risk Concentrations
Credit Risk Concentrations | 9 Months Ended |
Sep. 30, 2016 | |
Risks and Uncertainties [Abstract] | |
Credit Risk Concentrations | Credit Risk Concentrations Concentrations of credit risk may arise when a number of properties or tenants are located in a similar geographic region such that the economic conditions of that region could impact tenants’ obligations to meet their contractual obligations or cause the values of individual properties to decline. The Account has no significant concentrations of tenants as no single tenant has annual contract rent that makes up more than 3% of the rental income of the Account. The Account’s wholly owned real estate and joint venture investments are located in the United States. The following table represents the diversification of the Account’s portfolio by region and property type as of September 30, 2016 : Diversification by Fair Value (1) West East South Midwest Total Office 16.3 % 21.3 % 5.7 % 0.2 % 43.5 % Apartment 8.1 % 8.6 % 4.0 % — 20.7 % Retail 7.6 % 3.3 % 7.6 % 0.3 % 18.8 % Industrial 7.7 % 1.5 % 4.0 % 0.8 % 14.0 % Other (2) 0.3 % 2.5 % 0.1 % 0.1 % 3.0 % Total 40.0 % 37.2 % 21.4 % 1.4 % 100.0 % (1) Wholly owned properties are represented at fair value and gross of any debt, while joint venture properties are represented at the net equity value. (2) Represents interest in Storage Portfolio investment and a fee interest encumbered by a ground lease real estate investment. Properties in the “East” region are located in: CT, DC, DE, KY, MA, MD, ME, NC, NH, NJ, NY, PA, RI, SC, VA, VT, WV Properties in the “West” region are located in: AK, AZ, CA, CO, HI, ID, MT, NM, NV, OR, UT, WA, WY Properties in the “South” region are located in: AL, AR, FL, GA, LA, MS, OK, TN, TX Properties in the “Midwest” region are located in: IA, IL, IN, KS, MI, MN, MO, ND, NE, OH, SD, WI |
Assets and Liabilities Measured
Assets and Liabilities Measured at Fair Value on a Recurring Basis | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | Assets and Liabilities Measured at Fair Value on a Recurring Basis Valuation Hierarchy: The Account’s fair value measurements are grouped categorically into three levels, as defined by the FASB. The levels are defined as follows: Level 1—Valuations using unadjusted quoted prices for assets traded in active markets, such as stocks listed on the New York Stock Exchange. Active markets are defined as having the following characteristics for the measured asset or liability: (i) many transactions, (ii) current prices, (iii) price quotes not varying substantially among market makers, (iv) narrow bid/ask spreads and (v) most information regarding the issuer is publicly available. Level 1 assets held by the Account are generally marketable equity securities. Level 2—Valuations for assets and liabilities traded in less active, dealer or broker markets. Fair values are primarily obtained from third party pricing services for identical or comparable assets or liabilities. Level 2 inputs for fair value measurements are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include: a. Quoted prices for similar assets or liabilities in active markets; b. Quoted prices for identical or similar assets or liabilities in markets that are not active (that is, markets in which there are few transactions for the asset (or liability), the prices are not current, price quotations vary substantially either over time or among market makers (for example, some brokered markets), or in which little information is released publicly); c. Inputs other than quoted prices that are observable within the market for the asset (or liability) (for example, interest rates and yield curves, implied volatilities, prepayment speeds, loss severities, credit risks, and default rates that are observable at commonly quoted intervals); and d. Inputs that are derived principally from or corroborated by observable market data by correlation or other means (for example, market-corroborated inputs). Examples of securities which may be held by the Account and included in Level 2 include certificates of deposit, commercial paper, government agency notes, variable notes, U.S. Treasury securities, and debt securities. Level 3—Valuations for assets and liabilities that are derived from other valuation methodologies, including pricing models, discounted cash flow models and similar techniques, and are not based on market exchange, dealer, or broker-traded transactions. Level 3 valuations incorporate certain assumptions and projections that are not observable in the market, and require significant professional judgment in determining the fair value assigned to such assets or liabilities. Examples of Level 3 assets and liabilities which may be held by the Account from time to time include investments in real estate, investments in joint ventures, and loans receivable and payable. An investment’s categorization within the valuation hierarchy described above is based upon the lowest level of input that is significant to the fair value measurement. The Account’s limited partnership investments are valued using the net asset value per share as a practical expedient, which excludes the investments from the valuation hierarchy. The Account’s determination of fair value is based upon quoted market prices, where available. If listed prices or quotes are not available, fair value is based upon vendor-provided, evaluated prices or internally developed models that primarily use market-based or independently sourced market data, including interest rate yield curves, market spreads, and currency rates. Valuation adjustments will be made to reflect changes in credit quality, counterparty’s creditworthiness, the Account’s creditworthiness, liquidity, and other observable and unobservable inputs that are applied consistently over time. The methods described above are considered to produce fair values that represent a good faith estimate of what an unaffiliated buyer in the marketplace would pay to purchase the asset or would receive to transfer the liability. Since fair value calculations involve significant professional judgment in the application of both observable and unobservable attributes, actual realizable values or future fair values may differ from amounts reported. Furthermore, while the Account believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments, while reasonable, could result in different estimates of fair value at the reporting date. As discussed in Note 1—Organization and Significant Accounting Policies in more detail, the Account generally obtains independent third party appraisals on a quarterly basis; there may be circumstances in the interim in which the true realizable value of a property is not reflected in the Account’s daily net asset value calculation or in the Account’s periodic consolidated financial statements. This disparity may be more apparent when the commercial and/or residential real estate markets experience an overall and possibly dramatic decline (or increase) in property values in a relatively short period of time between appraisals. The following tables show the major categories of assets and liabilities measured at fair value on a recurring basis as of September 30, 2016 (unaudited) and December 31, 2015 , using unadjusted quoted prices in active markets for identical assets (Level 1); significant other observable inputs (Level 2); and significant unobservable inputs (Level 3); and practical expedient (in millions): Description Level 1: Quoted Prices in Active Markets for Identical Assets Level 2: Significant Other Observable Inputs Level 3: Significant Unobservable Inputs Fair Value Using Practical Expedient Total at Real estate properties $ — $ — $ 15,208.7 $ — $ 15,208.7 Real estate joint ventures — — 5,306.0 — 5,306.0 Limited partnerships — — — 142.9 142.9 Marketable securities: Real estate related 1,128.1 — — — 1,128.1 Government agency notes — 2,709.9 — — 2,709.9 United States Treasury securities — 1,702.6 — — 1,702.6 Loans receivable — — 169.7 — 169.7 Total Investments at $ 1,128.1 $ 4,412.5 $ 20,684.4 $ 142.9 $ 26,367.9 Mortgage loans payable $ — $ — $ (2,378.1 ) $ — $ (2,378.1 ) Description Level 1: Quoted Prices in Active Markets for Identical Assets Level 2: Significant Other Observable Inputs Level 3: Significant Unobservable Inputs Fair Value Using Practical Expedient Total at December 31, 2015 Real estate properties $ — $ — $ 14,606.2 $ — $ 14,606.2 Real estate joint ventures — — 4,068.4 — 4,068.4 Limited partnerships — — — 144.8 144.8 Marketable securities: Real estate related 1,024.4 — — — 1,024.4 Government agency notes — 2,666.8 — — 2,666.8 United States Treasury securities — 1,540.4 — — 1,540.4 Loan receivable — — 100.6 — 100.6 Total Investments at December 31, 2015 $ 1,024.4 $ 4,207.2 $ 18,775.2 $ 144.8 $ 24,151.6 Mortgage loans payable $ — $ — $ (1,794.4 ) $ — $ (1,794.4 ) The following tables show the reconciliation of the beginning and ending balances for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three and nine months ended September 30, 2016 and 2015 (in millions, unaudited): Real Estate Real Estate Loans Total Mortgage For the three months ended September 30, 2016 Beginning balance July 1, 2016 $ 15,131.3 $ 4,238.9 $ 100.6 $ 19,470.8 $ (2,383.2 ) Total realized and unrealized gains (losses) included in changes in net assets 53.3 23.9 0.1 77.3 (29.1 ) Purchases (1) 82.1 1,043.4 69.0 1,194.5 — Sales (58.0 ) — — (58.0 ) — Settlements (2) — (0.2 ) — (0.2 ) 34.2 Ending balance September 30, 2016 $ 15,208.7 $ 5,306.0 $ 169.7 $ 20,684.4 $ (2,378.1 ) Real Estate Real Estate Loans Total Mortgage For the nine months ended Beginning balance January 1, 2016 $ 14,606.2 $ 4,068.4 $ 100.6 $ 18,775.2 $ (1,794.4 ) Total realized and unrealized gains (losses) included in changes in net assets 268.7 157.4 0.1 426.2 (54.8 ) Purchases (1) 486.7 1,082.1 69.0 1,637.8 (563.5 ) Sales (152.9 ) — — (152.9 ) — Settlements (2) — (1.9 ) — (1.9 ) 34.6 Ending balance September 30, 2016 $ 15,208.7 $ 5,306.0 $ 169.7 $ 20,684.4 $ (2,378.1 ) Real Estate Real Estate Loan Receivable Total Mortgage For the three months ended September 30, 2015 Beginning balance July 1, 2015 $ 13,684.9 $ 3,256.3 $ — $ 16,941.2 $ (1,996.3 ) Total realized and unrealized gains included in changes in net assets 166.5 95.0 0.1 261.6 11.4 Purchases (1) 362.1 123.6 100.0 585.7 — Sales — — — — — Settlements (2) — (0.3 ) — (0.3 ) 153.2 Ending balance September 30, 2015 $ 14,213.5 $ 3,474.6 $ 100.1 $ 17,788.2 $ (1,831.7 ) Real Estate Real Estate Loan Receivable Total Mortgage For the nine months ended Beginning balance January 1, 2015 $ 13,139.0 $ 3,022.1 $ — $ 16,161.1 $ (2,373.8 ) Total realized and unrealized gains included in changes in net assets 624.6 376.3 0.1 1,001.0 3.5 Purchases (1) 1,071.3 137.3 100.0 1,308.6 — Sales (621.4 ) — — (621.4 ) — Settlements (2) — (61.1 ) — (61.1 ) 538.6 Ending balance September 30, 2015 $ 14,213.5 $ 3,474.6 $ 100.1 $ 17,788.2 $ (1,831.7 ) (1) Includes purchases, contributions for joint ventures, capital expenditures, and lending for mortgage loans receivable. (2) Includes operating income for real estate joint ventures, net of distributions, and principal payments and extinguishments of mortgage loans payable. The following table shows quantitative information about unobservable inputs related to the Level 3 fair value measurements as of September 30, 2016 (unaudited). Type Asset Class Valuation Unobservable Range (Weighted Average) Real Estate Properties and Joint Ventures Office Income Approach—Discounted Cash Flow Discount Rate 5.8% - 8.5% (6.5%) Income Approach—Direct Capitalization Overall Capitalization Rate 3.8% - 7.0% (4.7%) Industrial Income Approach—Discounted Cash Flow Discount Rate 5.7% - 8.6% (6.7%) Income Approach—Direct Capitalization Overall Capitalization Rate 4.0% - 7.3% (5.0%) Apartment Income Approach—Discounted Cash Flow Discount Rate 5.3% - 7.3% (6.2%) Income Approach—Direct Capitalization Overall Capitalization Rate 3.3% - 5.3% (4.2%) Retail Income Approach—Discounted Cash Flow Discount Rate 5.0% - 10.4% (6.4%) Income Approach—Direct Capitalization Overall Capitalization Rate 3.9% - 8.3% (4.7%) Mortgage Loans Payable Office and Industrial Discounted Cash Flow Loan to Value Ratio 35.7% - 49.8% (42.9%) Net Present Value Loan to Value Ratio 35.7% - 49.8% (42.9%) Apartment Discounted Cash Flow Loan to Value Ratio 29.4% - 61.4% (41.7%) Net Present Value Loan to Value Ratio 29.4% - 61.4% (41.7%) Retail Discounted Cash Flow Loan to Value Ratio 18.4% - 48.1% (31.3%) Net Present Value Loan to Value Ratio 18.4% - 48.1% (31.3%) Loans Receivable Office, Retail and Storage Discounted Cash Flow Loan to Value Ratio 55.6% - 79.2% (77.0%) Real Estate Properties and Joint Ventures: The significant unobservable inputs used in the fair value measurement of the Account’s real estate property and joint venture investments are the selection of certain investment rates (Discount Rate, Terminal Capitalization Rate, and Overall Capitalization Rate). Significant increases (decreases) in any of those inputs in isolation would result in significantly lower (higher) fair value measurements, respectively. Mortgage Loans Payable: The significant unobservable inputs used in the fair value measurement of the Account’s mortgage loans payable are the loan to value ratios and the selection of certain credit spreads and weighted average cost of capital risk premiums. Significant increases (decreases) in any of those inputs in isolation would result in a significantly lower (higher) fair value, respectively. Loans Receivable: The significant unobservable inputs used in the fair value measurement of the Account’s loans receivable are the loan to value ratios and the selection of certain credit spreads. Significant increases (decreases) in any of those inputs in isolation would result in a significantly lower (higher) fair value, respectively. During the nine months ended September 30, 2016 and 2015 , there were no transfers between Levels 1, 2 or 3. The amount of total net unrealized gains (losses) included in changes in net assets attributable to the change in net unrealized gains (losses) relating to Level 3 investments and mortgage loans payable using significant unobservable inputs still held as of the reporting date is as follows (in millions, unaudited): Real Estate Properties Real Estate Joint Ventures Loan Receivable Total Level 3 Investments Mortgage Loans Payable For the three months ended September 30, 2016 $ 53.9 $ 23.7 $ 0.1 $ 77.7 $ (29.1 ) For the nine months ended September 30, 2016 $ 270.1 $ 157.2 $ 0.1 $ 427.4 $ (54.8 ) For the three months ended September 30, 2015 $ 166.5 $ 95.1 $ 0.1 $ 261.7 $ 11.4 For the nine months ended September 30, 2015 $ 640.7 $ 378.5 $ 0.1 $ 1,019.3 $ 3.5 |
Mortgage Loans Payable
Mortgage Loans Payable | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Mortgage Loans Payable | Mortgage Loans Payable At September 30, 2016 , the Account had outstanding mortgage loans payable secured by the following properties (in millions): Property Annual Interest Rate and (2) Principal Maturity September 30, 2016 December 31, 2015 (Unaudited) Charleston Plaza (1) (4) (8) 5.60% paid monthly $ — $ 34.7 September 11, 2016 The Legend at Kierland (4) (5) 4.97% paid monthly 21.8 21.8 August 1, 2017 The Tradition at Kierland (4) (5) 4.97% paid monthly 25.8 25.8 August 1, 2017 Mass Court (4) 2.88% paid monthly 92.6 92.6 September 1, 2019 Red Canyon at Palomino Park (4) (6) 5.34% paid monthly 27.1 27.1 August 1, 2020 Green River at Palomino Park (4) (6) 5.34% paid monthly 33.2 33.2 August 1, 2020 Blue Ridge at Palomino Park (4) (6) 5.34% paid monthly 33.4 33.4 August 1, 2020 Ashford Meadows (4) 5.17% paid monthly 44.6 44.6 August 1, 2020 The Corner (4) 4.66% paid monthly 105.0 105.0 June 1, 2021 The Palatine (4) 4.25% paid monthly 80.0 80.0 January 10, 2022 The Forum at Carlsbad (4) 4.25% paid monthly 90.0 90.0 March 1, 2022 The Colorado (4) 3.69% paid monthly 91.7 91.7 November 1, 2022 The Legacy at Westwood (4) 3.69% paid monthly 46.7 46.7 November 1, 2022 Regents Court (4) 3.69% paid monthly 39.6 39.6 November 1, 2022 The Caruth (4) 3.69% paid monthly 45.0 45.0 November 1, 2022 Fourth & Madison (4) 3.75% paid monthly 200.0 200.0 June 1, 2023 1001 Pennsylvania Avenue 3.70% paid monthly 330.0 330.0 June 1, 2023 1401 H Street NW (4) 3.65% paid monthly 115.0 115.0 November 5, 2024 780 Third Avenue (4) 3.55% paid monthly 150.0 150.0 August 1, 2025 780 Third Avenue (4) 3.55% paid monthly 20.0 20.0 August 1, 2025 701 Brickell Avenue (4) 3.66% paid monthly 184.0 — April 1, 2026 55 Second Street (4) (7) 3.74% paid monthly 137.5 137.5 October 1, 2026 1900 K Street, NW 3.93% paid monthly 163.0 — April 1, 2028 501 Boylston Street (4) 3.70% paid monthly 216.5 — April 1, 2028 Total Principal Outstanding $ 2,292.5 $ 1,763.7 Fair Value Adjustment (3) 85.6 30.7 Total mortgage loans payable $ 2,378.1 $ 1,794.4 (1) The mortgage is adjusted monthly for principal payments. (2) Interest rates are fixed. All mortgages held as of September 30, 2016 are interest-only; however, some mortgages held by the Account are structured to begin principal and interest payments after an initial interest-only period. (3) The fair value adjustment consists of the difference (positive or negative) between the principal amount of the outstanding debt and the fair value of the outstanding debt. See Note 1- Organization and Significant Accounting Policies. (4) These properties are each owned by separate wholly owned subsidiaries of TIAA for benefit of the Account. The assets and credit of each of these borrowings entities are not available to satisfy the debts and other obligations of the Account or any other entity or person other than such borrowing entity. (5) Represents mortgage loans on these individual properties which are held within the Kierland Apartment portfolio. (6) Represents mortgage loans on these individual properties which are held within the Palomino Park portfolio. (7) This mortgage is comprised of three individual loans, all with equal recourse, interest rate and maturity. The principal balances by loan are $79.0 million , $45.0 million and $13.5 million . (8) On July 11, 2016, the outstanding principal of the mortgage was paid off by the Account. |
Financial Highlights
Financial Highlights | 9 Months Ended |
Sep. 30, 2016 | |
Condensed Financial Information Disclosure [Abstract] | |
Financial Highlights | Financial Highlights Selected condensed financial information for an Accumulation Unit of the Account is presented below. Per Accumulation Unit data is calculated on average units outstanding. For the Nine Months Ended September 30, 2016 Years Ended December 31, 2015 2014 2013 (Unaudited) Per Accumulation Unit Data: Rental income $ 12.311 $ 15.538 $ 15.862 $ 15.313 Real estate property level expenses and taxes 5.598 7.319 7.788 8.112 Real estate income, net 6.713 8.219 8.074 7.201 Other income 2.435 3.342 3.459 2.759 Total income 9.148 11.561 11.533 9.960 Expense charges (1) 2.451 3.092 2.880 2.672 Investment income, net 6.697 8.469 8.653 7.288 Net realized and unrealized gain on investments and mortgage loans payable 7.436 18.911 27.868 19.015 Net increase in Accumulation Unit Value 14.133 27.380 36.521 26.303 Accumulation Unit Value: Beginning of period 362.773 335.393 298.872 272.569 End of period $ 376.906 $ 362.773 $ 335.393 $ 298.872 Total return 3.90 % 8.16 % 12.22 % 9.65 % Ratios to Average net assets (2) : Expenses (1) 0.86 % 0.86 % 0.89 % 0.92 % Investment income, net 2.35 % 2.37 % 2.68 % 2.50 % Portfolio turnover rate (3) : Real estate properties (4) 0.8 % 5.7 % 6.5 % 2.1 % Marketable securities (5) 2.8 % 10.0 % 15.9 % 8.4 % Accumulation Units outstanding at end of period (in millions) 62.4 60.4 57.9 55.3 Net assets end of period (in millions) $ 24,011.5 $ 22,360.0 $ 19,829.0 $ 16,907.9 (1) Expense charges per Accumulation Unit and the Ratio of Expenses to average net assets reflect the year to date Account-level expenses and exclude real estate property level expenses which are included in real estate income, net. (2) Percentages for the nine months ended September 30, 2016 are annualized. (3) Percentages for the nine months ended September 30, 2016 are not annualized. (4) Real estate investment portfolio turnover rate is calculated by dividing the lesser of purchases or sales of real estate property investments (including loans receivable, contributions to, or return of capital distributions received from, existing joint venture and limited partnership investments) by the average value of the portfolio of real estate investments held during the period. (5) Marketable securities portfolio turnover rate is calculated by dividing the lesser of purchases or sales of securities, excluding securities having maturity dates at acquisition of one year or less, by the average value of the portfolio securities held during the period. |
Accumulation Units
Accumulation Units | 9 Months Ended |
Sep. 30, 2016 | |
Accumulated Units Disclosure [Abstract] | |
Accumulation Units | Accumulation Units Changes in the number of Accumulation Units outstanding were as follows (in millions): For the Nine Months Ended September 30, 2016 For the Year Ended December 31, 2015 (Unaudited) Outstanding: Beginning of period 60.4 57.9 Credited for premiums 6.3 8.1 Annuity, other periodic payments, withdrawals and death benefits (4.3 ) (5.6 ) End of period 62.4 60.4 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Commitments —The Account had $37.7 million and $45.0 million of outstanding immediately callable commitments at September 30, 2016 and December 31, 2015 , respectively. The commitment is related to the Taconic New York City GP Fund, LP, in which the Account has entered into an agreement to provide funding as a limited partner. Once the complete obligation is funded, the Account anticipates holding a 60% - 90% interest in the fund. Contingencies —The Account is party to various claims and routine litigation arising in the ordinary course of business. Management of the Account does not believe the results of any such claims or litigation, individually, or in the aggregate, will have a material effect on the Account’s business, financial position, or results of operations. |
Securities Lending
Securities Lending | 9 Months Ended |
Sep. 30, 2016 | |
Receivables [Abstract] | |
Securities Lending | Securities Lending The Account may lend securities to qualified borrowers to earn additional income. The Account receives cash collateral against the loaned securities and maintains cash collateral in an amount not less than 102% of the market value of loaned securities during the period of the loan; any additional collateral required due to changes in security values is delivered to the Account the next business day. Cash collateral received by the Account is invested exclusively in an interest-bearing deposit account. The value of the loaned securities and the liability to return the cash collateral received are reflected in the consolidated statements of assets and liabilities. As of September 30, 2016, securities lending transactions are for real-estate related equity securities, and the resulting loans are continuous, can be recalled at any time, and have no set maturity. Securities lending income recognized by the Account consists of interest earned on cash collateral and lending fees, net of any rebates to the borrower and compensation to the agent. Such income is reflected within interest income on the consolidated statements of operations. In lending its securities, the Account bears the market risk with respect to the investment of collateral and the risk that the agent may default on its contractual obligations to the Account. The agent bears the risk that the borrower may default on its obligation to return the loaned securities as the agent is contractually obligated to indemnify the Account if at the time of a default by a borrower some or all of the loan securities have not been returned. |
Organization and Significant 16
Organization and Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis Of Presentation | Basis of Presentation: The accompanying consolidated financial statements include the Account and those subsidiaries wholly owned by TIAA for the benefit of the Account. All significant intercompany accounts and transactions between the Account and such subsidiaries have been eliminated. The Accumulation Unit Value (“AUV”) used for financial reporting purposes may differ from the AUV used for processing transactions. The AUV used for financial reporting purposes includes security and participant transactions effective through the period end date to which this report relates. Total return is computed based on the AUV used for processing transactions. |
Determination of Investments at Fair Value | Determination of Investments at Fair Value: The Account reports all investments at fair value in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 946, Financial Services—Investment Companies. Further, in accordance with the adoption of the fair value option allowed under ASC 825, Financial Instruments , and at the election of Account management, mortgage loans payable are reported at fair value. The FASB has defined fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The following is a description of the valuation methodologies used to determine the fair value of the Account’s investments and investment related mortgage loans payable. Valuation of Real Estate Properties —Investments in real estate properties are stated at fair value, as determined in accordance with policies and procedures reviewed by the Investment Committee of the Board and in accordance with the responsibilities of the Board as a whole. Accordingly, the Account does not record depreciation. Determination of fair value involves significant levels of judgment because the actual fair value of real estate can be determined only by negotiation between the parties in a sales transaction. The Account’s primary objective when valuing its real estate investments will be to produce a valuation that represents a reasonable estimate of the fair value of its investments. Implicit in the Account’s definition of fair value, are the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: • Buyer and seller are typically motivated; • Both parties are well informed or well advised, and acting in what they consider their best interests; • A reasonable time is allowed for exposure in the open market; • Payment is made in terms of cash or in terms of financial arrangements comparable thereto; and • The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. Property and investment values are affected by, among other things, the availability of capital, occupancy rates, rental rates, and interest and inflation rates. As a result, determining real estate and investment values involves many assumptions. Key inputs and assumptions include rental income and expense amounts, related rental income and expense growth rates, capital expenditures, discount rates and capitalization rates. Valuation techniques include discounted cash flow analysis, prevailing market capitalization rates or multiples applied to earnings from the property, analysis of recent comparable sales transactions, actual sale negotiations and bona fide purchase offers received from third parties. Amounts ultimately realized from each investment may vary significantly from the fair value presented. Real estate properties owned by the Account are initially valued based on an independent third party appraisal, as reviewed by TIAA’s internal appraisal staff and as applicable by the Account’s independent fiduciary at the time of the closing of the purchase. Such initial valuation may result in a potential unrealized gain or loss reflecting the difference between an investment’s fair value (i.e., exit price) and its cost basis (which is inclusive of transaction costs). Subsequently, each property is appraised each quarter by an independent third party appraiser, reviewed by TIAA’s internal appraisal staff and as applicable the Account’s independent fiduciary. In general, the Account obtains appraisals of its real estate properties spread out throughout the quarter, which is intended to result in appraisal adjustments, and thus, adjustments to the valuations of its holdings (to the extent such adjustments are made) that happen regularly throughout each quarter and not on one specific day or month in each period. Further, management reserves the right to order an appraisal and/or conduct another valuation outside of the normal quarterly process when facts or circumstances at a specific property change. For example, under certain circumstances a valuation adjustment could be made when the Account receives a bona fide bid for the sale of a property held within the Account or one of the Account’s joint ventures. Adjustments may be made for events or circumstances indicating an impairment of a tenant’s ability to pay amounts due to the Account under a lease (including due to a bankruptcy filing of that tenant). Alternatively, adjustments may be made to reflect the execution or renewal of a significant lease. Also, adjustments may be made to reflect factors (such as sales values for comparable properties or local employment rate) bearing uniquely on a particular region in which the Account holds properties. TIAA’s internal appraisal staff oversees the entire appraisal process, in conjunction with the Account’s independent fiduciary (the independent fiduciary is more fully described in the following paragraph). Any differences in the conclusions of TIAA’s internal appraisal staff and the independent appraiser will be reviewed by the independent fiduciary, which will make a final determination on the matter (which may include ordering a subsequent independent appraisal). The independent fiduciary, RERC, LLC, has been appointed by a special subcommittee of the Investment Committee of the Board to, among other things, oversee the appraisal process. The independent fiduciary must approve all independent appraisers used by the Account. All appraisals are performed in accordance with Uniform Standards of Professional Appraisal Practices, the real estate appraisal industry standards created by The Appraisal Foundation. Real estate appraisals are estimates of property values based on a professional’s opinion. Appraisals of properties held outside of the U.S. are performed in accordance with industry standards commonly applied in the applicable jurisdiction. These independent appraisers are always expected to be MAI-designated members of the Appraisal Institute (or its European equivalent, Royal Institute of Chartered Surveyors) and state certified appraisers from national or regional firms with relevant property type experience and market knowledge. Under the Account’s current procedures, each independent appraisal firm will be rotated off of a particular property at least every three years, although such appraisal firm may perform appraisals of other Account properties subsequent to such rotation. Also, the independent fiduciary can require additional appraisals if factors or events have occurred that could materially change a property’s value (including those identified previously) and such change is not reflected in the quarterly valuation review, or otherwise to ensure that the Account is valued appropriately. The independent fiduciary must also approve any valuation change of real estate-related assets where a property’s value changed by more than 6% from the most recent independent annual appraisal, or if the value of the Account would change by more than 4% within any calendar quarter or more than 2% since the prior calendar month. When a real estate property is subject to a mortgage, the property is valued independently of the mortgage and the property and mortgage fair values are reported separately (see Valuation of Mortgage Loans Payable ). The independent fiduciary reviews and approves all mortgage valuation adjustments before such adjustments are recorded by the Account. The Account continues to use the revised value for each real estate property and mortgage loan payable to calculate the Account’s daily net asset value until the next valuation review or appraisal. Valuation of Real Estate Joint Ventures —Real estate joint ventures are stated at the fair value of the Account’s ownership interests of the underlying entities. The Account’s ownership interests are valued based on the fair value of the underlying real estate, any related mortgage loans payable, and other factors, such as ownership percentage, ownership rights, buy/sell agreements, distribution provisions and capital call obligations. Upon the disposition of all real estate investments by an investee entity, the Account will continue to state its equity in the remaining net assets of the investee entity during the wind down period, if any, which occurs prior to the dissolution of the investee entity. Valuation of Real Estate Limited Partnerships —Limited partnership interests are stated at the fair value of the Account’s ownership in the partnership. Such limited partnership interests are recorded based upon the changes in the net asset values of the limited partnerships as determined from the financial statements of the limited partnerships when received by the Account. Prior to the receipt of the financial statements from the limited partnerships, the Account estimates the value of its interest in good faith and will from time to time seek input from the issuer or the sponsor of the investments. Since market quotations are not readily available, the limited partnership interests are valued at fair value as determined in good faith by management under the direction of the Investment Committee of the Board and in accordance with the responsibilities of the Board as a whole. Valuation of Marketable Securities —Equity securities listed or traded on any national market or exchange are valued at the last sale price as of the close of the principal securities market or exchange on which such securities are traded or, if there is no sale, at the mean of the last bid and asked prices on such market or exchange, exclusive of transaction costs. Debt securities with readily available market quotations, other than money market instruments, are generally valued at the most recent bid price or the equivalent quoted yield for such securities (or those of comparable maturity, quality and type). Debt securities for which market quotations are not readily available, are valued at fair value as determined in good faith by the Investment Committee of the Board and in accordance with the responsibilities of the Board as a whole. Short-term investments are valued in the same manner as debt securities, as described above. Money market instruments are valued at amortized cost, which approximates fair value. Equity and fixed income securities traded on a foreign exchange or in foreign markets are valued using their closing values under the valuation methods generally accepted in the country where traded, as of the valuation date. This value is converted to U.S. dollars at the exchange rate in effect on the valuation day. Under certain circumstances (for example, if there are significant movements in the U.S. markets and there is an expectation the securities traded on foreign markets will adjust based on such movements when the foreign markets open the next day), the Account may adjust the value of equity or fixed income securities that trade on a foreign exchange or market after the foreign exchange or market has closed. Valuation of Loans Receivable —Loans receivable are stated at fair value and are initially valued at the face amount of the loan funding. Subsequently, loans receivable are valued at least quarterly by TIAA’s internal valuation department based on market factors, such as market interest rates and spreads for comparable loans, the liquidity for loans of similar characteristics, the performance of the underlying collateral (such as the loan-to-value ratio and the cash flow of the underlying collateral) and the credit quality of the counterparty. The independent fiduciary reviews and approves all loan receivable valuation adjustments before such adjustments are recorded by the Account. The Account continues to use the revised value for each loan receivable to calculate the Account’s daily net asset value until the next valuation review. Valuation of Mortgage Loans Payable —Mortgage loans payable are stated at fair value. The estimated fair values of mortgage loans payable are based on the amount at which the liability could be transferred to a third party exclusive of transaction costs. Mortgage loans payable are valued internally by TIAA’s internal valuation department, as reviewed by the Account’s independent fiduciary, at least quarterly based on market factors, such as market interest rates and spreads for comparable loans, the performance of the underlying collateral (such as the loan-to-value ratio and the cash flow of the underlying collateral), the liquidity for mortgage loans of similar characteristics, the maturity date of the loan and the return demands of the market. See Note 4—Assets and Liabilities Measured at Fair Value on a Recurring Basis for further discussion and disclosure regarding the determination of the fair value of the Account’s investments. |
Foreign Currency Transactions and Translation | Foreign Currency Transactions and Translation: Portfolio investments and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rates prevailing at the end of the period. Purchases and sales of securities, income receipts and expense payments made in foreign currencies are translated into U.S. dollars at the exchange rates prevailing on the respective dates of the transactions. The effect of any changes in foreign currency exchange rates on portfolio investments and mortgage loans payable are included in net realized and unrealized gains and losses on real estate properties and mortgage loans payable. Net realized gains and losses on foreign currency transactions include disposition of foreign currencies, and currency gains and losses between the accrual and receipt dates of portfolio investment income and between the trade and settlement dates of portfolio investment transactions. |
Accumulation and Annuity Funds | Accumulation and Annuity Funds: The accumulation fund represents the net assets attributable to participants in the accumulation phase of their investment (“Accumulation Fund”). The annuity fund represents the net assets attributable to the participants currently receiving annuity payments (“Annuity Fund”). The net increase or decrease in net assets from investment operations is apportioned between the funds based upon their relative daily net asset values. Once an Account participant begins receiving lifetime annuity income benefits, payment levels cannot be reduced as a result of the Account’s actual mortality experience. In addition, the contracts pursuant to which the Account is offered are required to stipulate the maximum expense charge for all Account level expenses that can be assessed, which is not to exceed 2.5% of average net assets per year. The Account pays a fee to TIAA to assume mortality and expense risks. |
Accounting for Investments | Accounting for Investments: The investments held by the Account are accounted for as follows: Real Estate Properties —Rent from real estate properties consists of all amounts earned under tenant operating leases, including base rent, recoveries of real estate taxes and other expenses and charges for miscellaneous services provided to tenants. Rental income is recognized in accordance with the billing terms of the lease agreements. The Account bears the direct expenses of the real estate properties owned. These expenses include, but are not limited to, fees to local property management companies, property taxes, utilities, maintenance, repairs, insurance, and other operating and administrative costs. An estimate of the net operating income earned from each real estate property is accrued by the Account on a daily basis and such estimates are adjusted when actual operating results are determined. Real Estate Joint Ventures —The Account has limited ownership interests in various real estate joint ventures (collectively, the “joint ventures”). The Account records its contributions as increases to its investments in the joint ventures, and distributions from the joint ventures are treated as income within income from real estate joint ventures and limited partnerships in the Account’s consolidated statements of operations. Distributions that are identified as returns of capital are recorded as a reduction to the cost basis of the investment, whereas distributions identified as capital gains or losses are recorded as realized gains or losses. Income from the joint ventures is recorded based on the Account’s proportional interest of the income distributed by the joint ventures. Income earned but not yet distributed to the Account by the joint ventures is recorded as unrealized gains and losses. Limited Partnerships —The Account has limited ownership interests in various private real estate funds (primarily limited partnerships) and a private real estate investment trust (collectively, the “limited partnerships”). The Account records its contributions as increases to the investments, and distributions from the investments are treated as income within income from real estate joint ventures and limited partnerships in the Account’s consolidated statements of operations. Distributions that are identified as returns of capital are recorded as a reduction to the cost basis of the investment, whereas distributions identified as capital gains or losses are recorded as realized gains or losses. Unrealized gains and losses are recorded based upon the changes in the net asset values of the limited partnerships as determined from the financial statements of the limited partnerships when received by the Account. Prior to the receipt of the financial statements from the limited partnerships, the Account estimates the value of its interest in good faith and will from time to time seek input from the issuer or the sponsor of the investments. Changes in value based on such estimates are recorded by the Account as unrealized gains and losses. Marketable Securities —Transactions in marketable securities are accounted for as of the date the securities are purchased or sold (trade date). Interest income is recorded as earned. Dividend income is recorded on the ex-dividend date within dividend income. Dividends that are identified as returns of capital are recorded as a reduction to the cost basis of the investment, whereas dividends identified as capital gains or losses are recorded as realized gains or losses. Realized gains and losses on securities transactions are accounted for on the specific identification method. Loans Receivable —The Account has ownership interest in loans receivable. Interest income from the loans receivable is recognized using the effective interest method over the expected life of the loan. Realized and Unrealized Gains and Losses —Realized gains and losses are recorded at the time an investment is sold or a distribution is received in relation to an investment sale from a joint venture or limited partnership. Real estate transactions are accounted for as of the date on which the purchase or sale transactions for the real estate properties close (settlement date). The Account recognizes a realized gain on the sale of a real estate property to the extent that the contract sales price exceeds the cost-to-date of the property being sold. A realized loss occurs when the cost-to-date exceeds the sales price. Unrealized gains and losses are recorded as the fair values of the Account’s investments are adjusted, and as discussed within the Real Estate Joint Ventures and Limited Partnerships sections above. Net Assets —The Account’s net assets as of the close of each valuation day are valued by taking the sum of: • the value of the Account’s cash; cash equivalents, and short-term and other debt instruments; • the value of the Account’s other securities and other non-real estate assets; • the value of the individual real properties (based on the most recent valuation of that property) and other real estate-related investments owned by the Account; • an estimate of the net operating income accrued by the Account from its properties, other real estate-related investments and non-real estate-related investments (including short-term marketable securities) since the end of the prior valuation day; and • actual net operating income earned from the Account’s properties, other real estate-related investments and non-real estate-related investments (but only to the extent any such item of income differs from the estimated income accrued for on such investments), and then reducing the sum by liabilities held within the Account, including the daily investment management fee, administration and distribution fees, mortality and expense fee, liquidity guarantee fee, and certain other expenses attributable to operating the Account. Daily estimates of net operating income are adjusted to reflect actual net operating income on a monthly basis, at which time such adjustments (if any) are reflected in the Account’s unit value. After the end of every quarter, the Account reconciles the amount of expenses deducted from the Account (which is established in order to approximate the costs that the Account will incur) with the expenses the Account actually incurred. If there is a difference, the Account adds it to or deducts it from the Account in equal daily installments over the remaining days of the following quarter. Material differences may be repaid in the current calendar quarter. The Account’s at-cost deductions are based on projections of Account assets and overall expenses, and the size of any adjusting payments will be directly affected by the difference between management’s projections and the Account’s actual assets or expenses. |
Income from Securities Lending | Income from Securities Lending: The Account may lend securities to qualified borrowers to generate additional income. When loaning securities, the Account retains the benefits of owning the securities, including the economic equivalent of dividends or interest generated by the securities. Cash collateral received for securities on loan is maintained exclusively in an interest-bearing deposit account. All income generated by the securities lending program is reflected within interest income on the consolidated statements of operations. |
Cash and Cash Equivalents | Cash and Cash Equivalents: Cash and cash equivalents are balances held by the Account in bank deposit accounts which, at times, exceed federally insured limits. The Account’s management monitors these balances to mitigate the exposure of risk due to concentration and has not experienced any losses from such concentration. |
Other Assets and Other Liabilities | Other Assets and Other Liabilities: Other assets and other liabilities consist of operating assets and liabilities utilized and held at each individual real estate property investment. Other assets consist of, amongst other items, cash, tenant receivables and prepaid expenses; whereas other liabilities primarily consist of security deposits. Other assets also include cash collateral held for securities on loan. |
Federal Income Taxes | Federal Income Taxes: Based on provisions of the Internal Revenue Code, Section 817, the Account is taxed as a segregated asset account of TIAA and as such, the Account incurs no material federal income tax attributable to the net investment activity of the Account. The Account’s federal income tax return is generally subject to examination for a period of three years after filed. State and local tax returns may be subject to examination for an additional period of time depending on the jurisdiction. Management has analyzed the Account’s tax positions taken for all open federal income tax years and has concluded that no provision for federal income tax is required in the Account’s consolidated financial statements. |
Restricted Cash | Restricted Cash: The Account held $45.1 million and $50.9 million as of September 30, 2016 and December 31, 2015 , respectively, in escrow accounts for security deposits, as required by certain states, as well as property taxes, insurance, and various other property related matters as required by certain creditors related to outstanding mortgage loans payable collateralized by certain real estate investments. These amounts are recorded within other assets on the consolidated statements of assets and liabilities. See Note 5—Mortgage Loans Payable for additional information regarding the Account’s outstanding mortgage loans payable. |
Changes In Net Assets | Changes in Net Assets: Premiums include premiums paid by existing accumulation unit holders in the Account and transfers into the Account. Withdrawals and death benefits include withdrawals out of the Account which include transfers out of the Account and required minimum distributions. |
Due to/from Investment Manager | Due to/from Investment Manager: Due to/from investment manager represents amounts that are to be paid or received by TIAA on behalf of the Account. Amounts generally are paid or received by the Account within one or two business days and no interest is contractually charged on these amounts. |
New Accounting Pronouncements | New Accounting Pronouncements: In January 2016, the FASB issued ASU 2016-01 Financial Instruments (Topic 825)—Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”). This ASU amends, amongst other items, certain aspects of the recognition, measurement, presentation, and disclosure of financial instruments. These amendments are effective for public business entities for fiscal years and interim periods within those fiscal years beginning after December 15, 2017. Management is currently assessing the impact of ASU 2016-01 on the Account’s Consolidated Financial Statements. In February 2016, the FASB issued ASU 2016-02 Leases (Topic 842) (“ASU 2016-02”) which will supersede Topic 840, Leases. This ASU applies to all entities that enter into a lease. Lessees will be required to report assets and liabilities that arise from leases. Lessor accounting is expected to remain unchanged except in certain circumstances. This ASU is effective for public business entities for fiscal years beginning after December 15, 2018, including all interim periods within those fiscal years. Management is currently assessing the impact of ASU 2016-02 on the Account’s Consolidated Financial Statements. In August 2016, the FASB issued Accounting Standards Update 2016-15, Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”). ASU 2016-15 clarifies how to present cash receipts and cash payments for certain activity in the Statement of Cash Flows. These amendments are effective for public business entities within those fiscal years beginning after December 31, 2017, and interim periods within those fiscal years. Management is currently assessing the impact of ASU 2016-15 on the Account's Consolidated Financial Statements. |
Credit Risk Concentrations (Tab
Credit Risk Concentrations (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Risks and Uncertainties [Abstract] | |
Schedules of Concentration of Risk, by Risk Factor | The following table represents the diversification of the Account’s portfolio by region and property type as of September 30, 2016 : Diversification by Fair Value (1) West East South Midwest Total Office 16.3 % 21.3 % 5.7 % 0.2 % 43.5 % Apartment 8.1 % 8.6 % 4.0 % — 20.7 % Retail 7.6 % 3.3 % 7.6 % 0.3 % 18.8 % Industrial 7.7 % 1.5 % 4.0 % 0.8 % 14.0 % Other (2) 0.3 % 2.5 % 0.1 % 0.1 % 3.0 % Total 40.0 % 37.2 % 21.4 % 1.4 % 100.0 % (1) Wholly owned properties are represented at fair value and gross of any debt, while joint venture properties are represented at the net equity value. (2) Represents interest in Storage Portfolio investment and a fee interest encumbered by a ground lease real estate investment. Properties in the “East” region are located in: CT, DC, DE, KY, MA, MD, ME, NC, NH, NJ, NY, PA, RI, SC, VA, VT, WV Properties in the “West” region are located in: AK, AZ, CA, CO, HI, ID, MT, NM, NV, OR, UT, WA, WY Properties in the “South” region are located in: AL, AR, FL, GA, LA, MS, OK, TN, TX Properties in the “Midwest” region are located in: IA, IL, IN, KS, MI, MN, MO, ND, NE, OH, SD, WI |
Assets and Liabilities Measur18
Assets and Liabilities Measured at Fair Value on a Recurring Basis (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following tables show the major categories of assets and liabilities measured at fair value on a recurring basis as of September 30, 2016 (unaudited) and December 31, 2015 , using unadjusted quoted prices in active markets for identical assets (Level 1); significant other observable inputs (Level 2); and significant unobservable inputs (Level 3); and practical expedient (in millions): Description Level 1: Quoted Prices in Active Markets for Identical Assets Level 2: Significant Other Observable Inputs Level 3: Significant Unobservable Inputs Fair Value Using Practical Expedient Total at Real estate properties $ — $ — $ 15,208.7 $ — $ 15,208.7 Real estate joint ventures — — 5,306.0 — 5,306.0 Limited partnerships — — — 142.9 142.9 Marketable securities: Real estate related 1,128.1 — — — 1,128.1 Government agency notes — 2,709.9 — — 2,709.9 United States Treasury securities — 1,702.6 — — 1,702.6 Loans receivable — — 169.7 — 169.7 Total Investments at $ 1,128.1 $ 4,412.5 $ 20,684.4 $ 142.9 $ 26,367.9 Mortgage loans payable $ — $ — $ (2,378.1 ) $ — $ (2,378.1 ) Description Level 1: Quoted Prices in Active Markets for Identical Assets Level 2: Significant Other Observable Inputs Level 3: Significant Unobservable Inputs Fair Value Using Practical Expedient Total at December 31, 2015 Real estate properties $ — $ — $ 14,606.2 $ — $ 14,606.2 Real estate joint ventures — — 4,068.4 — 4,068.4 Limited partnerships — — — 144.8 144.8 Marketable securities: Real estate related 1,024.4 — — — 1,024.4 Government agency notes — 2,666.8 — — 2,666.8 United States Treasury securities — 1,540.4 — — 1,540.4 Loan receivable — — 100.6 — 100.6 Total Investments at December 31, 2015 $ 1,024.4 $ 4,207.2 $ 18,775.2 $ 144.8 $ 24,151.6 Mortgage loans payable $ — $ — $ (1,794.4 ) $ — $ (1,794.4 ) |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | The following tables show the reconciliation of the beginning and ending balances for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three and nine months ended September 30, 2016 and 2015 (in millions, unaudited): Real Estate Real Estate Loans Total Mortgage For the three months ended September 30, 2016 Beginning balance July 1, 2016 $ 15,131.3 $ 4,238.9 $ 100.6 $ 19,470.8 $ (2,383.2 ) Total realized and unrealized gains (losses) included in changes in net assets 53.3 23.9 0.1 77.3 (29.1 ) Purchases (1) 82.1 1,043.4 69.0 1,194.5 — Sales (58.0 ) — — (58.0 ) — Settlements (2) — (0.2 ) — (0.2 ) 34.2 Ending balance September 30, 2016 $ 15,208.7 $ 5,306.0 $ 169.7 $ 20,684.4 $ (2,378.1 ) Real Estate Real Estate Loans Total Mortgage For the nine months ended Beginning balance January 1, 2016 $ 14,606.2 $ 4,068.4 $ 100.6 $ 18,775.2 $ (1,794.4 ) Total realized and unrealized gains (losses) included in changes in net assets 268.7 157.4 0.1 426.2 (54.8 ) Purchases (1) 486.7 1,082.1 69.0 1,637.8 (563.5 ) Sales (152.9 ) — — (152.9 ) — Settlements (2) — (1.9 ) — (1.9 ) 34.6 Ending balance September 30, 2016 $ 15,208.7 $ 5,306.0 $ 169.7 $ 20,684.4 $ (2,378.1 ) Real Estate Real Estate Loan Receivable Total Mortgage For the three months ended September 30, 2015 Beginning balance July 1, 2015 $ 13,684.9 $ 3,256.3 $ — $ 16,941.2 $ (1,996.3 ) Total realized and unrealized gains included in changes in net assets 166.5 95.0 0.1 261.6 11.4 Purchases (1) 362.1 123.6 100.0 585.7 — Sales — — — — — Settlements (2) — (0.3 ) — (0.3 ) 153.2 Ending balance September 30, 2015 $ 14,213.5 $ 3,474.6 $ 100.1 $ 17,788.2 $ (1,831.7 ) Real Estate Real Estate Loan Receivable Total Mortgage For the nine months ended Beginning balance January 1, 2015 $ 13,139.0 $ 3,022.1 $ — $ 16,161.1 $ (2,373.8 ) Total realized and unrealized gains included in changes in net assets 624.6 376.3 0.1 1,001.0 3.5 Purchases (1) 1,071.3 137.3 100.0 1,308.6 — Sales (621.4 ) — — (621.4 ) — Settlements (2) — (61.1 ) — (61.1 ) 538.6 Ending balance September 30, 2015 $ 14,213.5 $ 3,474.6 $ 100.1 $ 17,788.2 $ (1,831.7 ) (1) Includes purchases, contributions for joint ventures, capital expenditures, and lending for mortgage loans receivable. (2) Includes operating income for real estate joint ventures, net of distributions, and principal payments and extinguishments of mortgage loans payable. |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following tables show the reconciliation of the beginning and ending balances for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three and nine months ended September 30, 2016 and 2015 (in millions, unaudited): Real Estate Real Estate Loans Total Mortgage For the three months ended September 30, 2016 Beginning balance July 1, 2016 $ 15,131.3 $ 4,238.9 $ 100.6 $ 19,470.8 $ (2,383.2 ) Total realized and unrealized gains (losses) included in changes in net assets 53.3 23.9 0.1 77.3 (29.1 ) Purchases (1) 82.1 1,043.4 69.0 1,194.5 — Sales (58.0 ) — — (58.0 ) — Settlements (2) — (0.2 ) — (0.2 ) 34.2 Ending balance September 30, 2016 $ 15,208.7 $ 5,306.0 $ 169.7 $ 20,684.4 $ (2,378.1 ) Real Estate Real Estate Loans Total Mortgage For the nine months ended Beginning balance January 1, 2016 $ 14,606.2 $ 4,068.4 $ 100.6 $ 18,775.2 $ (1,794.4 ) Total realized and unrealized gains (losses) included in changes in net assets 268.7 157.4 0.1 426.2 (54.8 ) Purchases (1) 486.7 1,082.1 69.0 1,637.8 (563.5 ) Sales (152.9 ) — — (152.9 ) — Settlements (2) — (1.9 ) — (1.9 ) 34.6 Ending balance September 30, 2016 $ 15,208.7 $ 5,306.0 $ 169.7 $ 20,684.4 $ (2,378.1 ) Real Estate Real Estate Loan Receivable Total Mortgage For the three months ended September 30, 2015 Beginning balance July 1, 2015 $ 13,684.9 $ 3,256.3 $ — $ 16,941.2 $ (1,996.3 ) Total realized and unrealized gains included in changes in net assets 166.5 95.0 0.1 261.6 11.4 Purchases (1) 362.1 123.6 100.0 585.7 — Sales — — — — — Settlements (2) — (0.3 ) — (0.3 ) 153.2 Ending balance September 30, 2015 $ 14,213.5 $ 3,474.6 $ 100.1 $ 17,788.2 $ (1,831.7 ) Real Estate Real Estate Loan Receivable Total Mortgage For the nine months ended Beginning balance January 1, 2015 $ 13,139.0 $ 3,022.1 $ — $ 16,161.1 $ (2,373.8 ) Total realized and unrealized gains included in changes in net assets 624.6 376.3 0.1 1,001.0 3.5 Purchases (1) 1,071.3 137.3 100.0 1,308.6 — Sales (621.4 ) — — (621.4 ) — Settlements (2) — (61.1 ) — (61.1 ) 538.6 Ending balance September 30, 2015 $ 14,213.5 $ 3,474.6 $ 100.1 $ 17,788.2 $ (1,831.7 ) (1) Includes purchases, contributions for joint ventures, capital expenditures, and lending for mortgage loans receivable. (2) Includes operating income for real estate joint ventures, net of distributions, and principal payments and extinguishments of mortgage loans payable. |
Schedule of Unobservable Inputs Related to Level 3 Fair Value Measurements | The following table shows quantitative information about unobservable inputs related to the Level 3 fair value measurements as of September 30, 2016 (unaudited). Type Asset Class Valuation Unobservable Range (Weighted Average) Real Estate Properties and Joint Ventures Office Income Approach—Discounted Cash Flow Discount Rate 5.8% - 8.5% (6.5%) Income Approach—Direct Capitalization Overall Capitalization Rate 3.8% - 7.0% (4.7%) Industrial Income Approach—Discounted Cash Flow Discount Rate 5.7% - 8.6% (6.7%) Income Approach—Direct Capitalization Overall Capitalization Rate 4.0% - 7.3% (5.0%) Apartment Income Approach—Discounted Cash Flow Discount Rate 5.3% - 7.3% (6.2%) Income Approach—Direct Capitalization Overall Capitalization Rate 3.3% - 5.3% (4.2%) Retail Income Approach—Discounted Cash Flow Discount Rate 5.0% - 10.4% (6.4%) Income Approach—Direct Capitalization Overall Capitalization Rate 3.9% - 8.3% (4.7%) Mortgage Loans Payable Office and Industrial Discounted Cash Flow Loan to Value Ratio 35.7% - 49.8% (42.9%) Net Present Value Loan to Value Ratio 35.7% - 49.8% (42.9%) Apartment Discounted Cash Flow Loan to Value Ratio 29.4% - 61.4% (41.7%) Net Present Value Loan to Value Ratio 29.4% - 61.4% (41.7%) Retail Discounted Cash Flow Loan to Value Ratio 18.4% - 48.1% (31.3%) Net Present Value Loan to Value Ratio 18.4% - 48.1% (31.3%) Loans Receivable Office, Retail and Storage Discounted Cash Flow Loan to Value Ratio 55.6% - 79.2% (77.0%) |
Fair Value Of Net Unrealized Gains Included In Changes In Net Assets Attributable To Investments And Mortgage Loans Payable Using Significant Unobservable Inputs | The amount of total net unrealized gains (losses) included in changes in net assets attributable to the change in net unrealized gains (losses) relating to Level 3 investments and mortgage loans payable using significant unobservable inputs still held as of the reporting date is as follows (in millions, unaudited): Real Estate Properties Real Estate Joint Ventures Loan Receivable Total Level 3 Investments Mortgage Loans Payable For the three months ended September 30, 2016 $ 53.9 $ 23.7 $ 0.1 $ 77.7 $ (29.1 ) For the nine months ended September 30, 2016 $ 270.1 $ 157.2 $ 0.1 $ 427.4 $ (54.8 ) For the three months ended September 30, 2015 $ 166.5 $ 95.1 $ 0.1 $ 261.7 $ 11.4 For the nine months ended September 30, 2015 $ 640.7 $ 378.5 $ 0.1 $ 1,019.3 $ 3.5 |
Mortgage Loans Payable (Tables)
Mortgage Loans Payable (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Schedule Of Outstanding Mortgage Loans Payable Secured By Properties | At September 30, 2016 , the Account had outstanding mortgage loans payable secured by the following properties (in millions): Property Annual Interest Rate and (2) Principal Maturity September 30, 2016 December 31, 2015 (Unaudited) Charleston Plaza (1) (4) (8) 5.60% paid monthly $ — $ 34.7 September 11, 2016 The Legend at Kierland (4) (5) 4.97% paid monthly 21.8 21.8 August 1, 2017 The Tradition at Kierland (4) (5) 4.97% paid monthly 25.8 25.8 August 1, 2017 Mass Court (4) 2.88% paid monthly 92.6 92.6 September 1, 2019 Red Canyon at Palomino Park (4) (6) 5.34% paid monthly 27.1 27.1 August 1, 2020 Green River at Palomino Park (4) (6) 5.34% paid monthly 33.2 33.2 August 1, 2020 Blue Ridge at Palomino Park (4) (6) 5.34% paid monthly 33.4 33.4 August 1, 2020 Ashford Meadows (4) 5.17% paid monthly 44.6 44.6 August 1, 2020 The Corner (4) 4.66% paid monthly 105.0 105.0 June 1, 2021 The Palatine (4) 4.25% paid monthly 80.0 80.0 January 10, 2022 The Forum at Carlsbad (4) 4.25% paid monthly 90.0 90.0 March 1, 2022 The Colorado (4) 3.69% paid monthly 91.7 91.7 November 1, 2022 The Legacy at Westwood (4) 3.69% paid monthly 46.7 46.7 November 1, 2022 Regents Court (4) 3.69% paid monthly 39.6 39.6 November 1, 2022 The Caruth (4) 3.69% paid monthly 45.0 45.0 November 1, 2022 Fourth & Madison (4) 3.75% paid monthly 200.0 200.0 June 1, 2023 1001 Pennsylvania Avenue 3.70% paid monthly 330.0 330.0 June 1, 2023 1401 H Street NW (4) 3.65% paid monthly 115.0 115.0 November 5, 2024 780 Third Avenue (4) 3.55% paid monthly 150.0 150.0 August 1, 2025 780 Third Avenue (4) 3.55% paid monthly 20.0 20.0 August 1, 2025 701 Brickell Avenue (4) 3.66% paid monthly 184.0 — April 1, 2026 55 Second Street (4) (7) 3.74% paid monthly 137.5 137.5 October 1, 2026 1900 K Street, NW 3.93% paid monthly 163.0 — April 1, 2028 501 Boylston Street (4) 3.70% paid monthly 216.5 — April 1, 2028 Total Principal Outstanding $ 2,292.5 $ 1,763.7 Fair Value Adjustment (3) 85.6 30.7 Total mortgage loans payable $ 2,378.1 $ 1,794.4 (1) The mortgage is adjusted monthly for principal payments. (2) Interest rates are fixed. All mortgages held as of September 30, 2016 are interest-only; however, some mortgages held by the Account are structured to begin principal and interest payments after an initial interest-only period. (3) The fair value adjustment consists of the difference (positive or negative) between the principal amount of the outstanding debt and the fair value of the outstanding debt. See Note 1- Organization and Significant Accounting Policies. (4) These properties are each owned by separate wholly owned subsidiaries of TIAA for benefit of the Account. The assets and credit of each of these borrowings entities are not available to satisfy the debts and other obligations of the Account or any other entity or person other than such borrowing entity. (5) Represents mortgage loans on these individual properties which are held within the Kierland Apartment portfolio. (6) Represents mortgage loans on these individual properties which are held within the Palomino Park portfolio. (7) This mortgage is comprised of three individual loans, all with equal recourse, interest rate and maturity. The principal balances by loan are $79.0 million , $45.0 million and $13.5 million . (8) On July 11, 2016, the outstanding principal of the mortgage was paid off by the Account. |
Financial Highlights (Tables)
Financial Highlights (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule Of Condensed Financial Information For An Accumulation Unit of The Account | Selected condensed financial information for an Accumulation Unit of the Account is presented below. Per Accumulation Unit data is calculated on average units outstanding. For the Nine Months Ended September 30, 2016 Years Ended December 31, 2015 2014 2013 (Unaudited) Per Accumulation Unit Data: Rental income $ 12.311 $ 15.538 $ 15.862 $ 15.313 Real estate property level expenses and taxes 5.598 7.319 7.788 8.112 Real estate income, net 6.713 8.219 8.074 7.201 Other income 2.435 3.342 3.459 2.759 Total income 9.148 11.561 11.533 9.960 Expense charges (1) 2.451 3.092 2.880 2.672 Investment income, net 6.697 8.469 8.653 7.288 Net realized and unrealized gain on investments and mortgage loans payable 7.436 18.911 27.868 19.015 Net increase in Accumulation Unit Value 14.133 27.380 36.521 26.303 Accumulation Unit Value: Beginning of period 362.773 335.393 298.872 272.569 End of period $ 376.906 $ 362.773 $ 335.393 $ 298.872 Total return 3.90 % 8.16 % 12.22 % 9.65 % Ratios to Average net assets (2) : Expenses (1) 0.86 % 0.86 % 0.89 % 0.92 % Investment income, net 2.35 % 2.37 % 2.68 % 2.50 % Portfolio turnover rate (3) : Real estate properties (4) 0.8 % 5.7 % 6.5 % 2.1 % Marketable securities (5) 2.8 % 10.0 % 15.9 % 8.4 % Accumulation Units outstanding at end of period (in millions) 62.4 60.4 57.9 55.3 Net assets end of period (in millions) $ 24,011.5 $ 22,360.0 $ 19,829.0 $ 16,907.9 (1) Expense charges per Accumulation Unit and the Ratio of Expenses to average net assets reflect the year to date Account-level expenses and exclude real estate property level expenses which are included in real estate income, net. (2) Percentages for the nine months ended September 30, 2016 are annualized. (3) Percentages for the nine months ended September 30, 2016 are not annualized. (4) Real estate investment portfolio turnover rate is calculated by dividing the lesser of purchases or sales of real estate property investments (including loans receivable, contributions to, or return of capital distributions received from, existing joint venture and limited partnership investments) by the average value of the portfolio of real estate investments held during the period. (5) Marketable securities portfolio turnover rate is calculated by dividing the lesser of purchases or sales of securities, excluding securities having maturity dates at acquisition of one year or less, by the average value of the portfolio securities held during the period. |
Accumulation Units (Tables)
Accumulation Units (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Accumulated Units Disclosure [Abstract] | |
Schedule Of Changes In The Number Of Accumulation Units Outstanding | Changes in the number of Accumulation Units outstanding were as follows (in millions): For the Nine Months Ended September 30, 2016 For the Year Ended December 31, 2015 (Unaudited) Outstanding: Beginning of period 60.4 57.9 Credited for premiums 6.3 8.1 Annuity, other periodic payments, withdrawals and death benefits (4.3 ) (5.6 ) End of period 62.4 60.4 |
Organization and Significant 22
Organization and Significant Accounting Policies (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2015 | |
Principal Transaction Revenue [Line Items] | ||
Independent appraisal firm, property rotation, period (at least) | 3 years | |
Description of valuation change of real estate related assets | Also, the independent fiduciary can require additional appraisals if factors or events have occurred that could materially change a property’s value (including those identified previously) and such change is not reflected in the quarterly valuation review, or otherwise to ensure that the Account is valued appropriately. The independent fiduciary must also approve any valuation change of real estate-related assets where a property’s value changed by more than 6% from the most recent independent annual appraisal, or if the value of the Account would change by more than 4% within any calendar quarter or more than 2% since the prior calendar month. When a real estate property is subject to a mortgage, the property is valued independently of the mortgage and the property and mortgage fair values are reported separately (see Valuation of Mortgage Loans Payable). The independent fiduciary reviews and approves all mortgage valuation adjustments before such adjustments are recorded by the Account. The Account continues to use the revised value for each real estate property and mortgage loan payable to calculate the Account’s daily net asset value until the next valuation review or appraisal. | |
Threshold percentage, property value change compared to most recent independent annual appraisal (more than) | 6.00% | |
Threshold percentage, property value change within any calendar quarter (more than) | 4.00% | |
Threshold percentage, property value change compared to prior calendar month (more than) | 2.00% | |
Maximum percentage of average net assets for all account level expenses | 2.50% | |
Restricted cash and cash equivalents | $ 45.1 | $ 50.9 |
Minimum | ||
Principal Transaction Revenue [Line Items] | ||
Investment advisory fees, paid or received, period | 1 day | |
Maximum | ||
Principal Transaction Revenue [Line Items] | ||
Investment advisory fees, paid or received, period | 2 days |
Management Agreements, Arrang23
Management Agreements, Arrangements and Related Party Transactions (Details) | 9 Months Ended |
Sep. 30, 2016 | |
Management Agreements And Arrangements [Abstract] | |
Distribution Agreement, termination period | 60 days |
Credit Risk Concentrations (Det
Credit Risk Concentrations (Details) | 9 Months Ended |
Sep. 30, 2016 | |
Risks and Uncertainties [Abstract] | |
Maximum percentage of annual contract rent of rental income (more than) | 3.00% |
Credit Risk Concentrations - Sc
Credit Risk Concentrations - Schedule of diversification of the Account's portfolio by region and property type (Details) | 9 Months Ended |
Sep. 30, 2016 | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 100.00% |
Office | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 43.50% |
Apartment | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 20.70% |
Retail | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 18.80% |
Industrial | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 14.00% |
Other | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 3.00% |
West | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 40.00% |
West | Office | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 16.30% |
West | Apartment | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 8.10% |
West | Retail | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 7.60% |
West | Industrial | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 7.70% |
West | Other | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 0.30% |
East | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 37.20% |
East | Office | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 21.30% |
East | Apartment | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 8.60% |
East | Retail | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 3.30% |
East | Industrial | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 1.50% |
East | Other | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 2.50% |
South | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 21.40% |
South | Office | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 5.70% |
South | Apartment | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 4.00% |
South | Retail | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 7.60% |
South | Industrial | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 4.00% |
South | Other | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 0.10% |
Midwest | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 1.40% |
Midwest | Office | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 0.20% |
Midwest | Apartment | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 0.00% |
Midwest | Retail | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 0.30% |
Midwest | Industrial | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 0.80% |
Midwest | Other | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 0.10% |
Assets and Liabilities Measur26
Assets and Liabilities Measured at Fair Value on a Recurring Basis - Schedule of fair value assets and liabilities measured on recurring basis (Details) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Real estate properties | $ 15,208.7 | $ 14,606.2 | |
Marketable securities: | |||
Real estate related | [1] | 1,128.1 | 1,024.4 |
Marketable Securities Excluding Real Estate | 4,412.5 | 4,207.2 | |
Total Investments | 26,367.9 | 24,151.6 | |
Mortgage loans payable | (2,378.1) | (1,794.4) | |
Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Real estate properties | 15,208.7 | 14,606.2 | |
Real estate joint ventures | 5,306 | 4,068.4 | |
Limited partnerships | 142.9 | 144.8 | |
Marketable securities: | |||
Real estate related | 1,128.1 | 1,024.4 | |
Loans receivable | 169.7 | 100.6 | |
Total Investments | 26,367.9 | 24,151.6 | |
Mortgage loans payable | (2,378.1) | (1,794.4) | |
Fair Value, Measurements, Recurring | Government agency notes | |||
Marketable securities: | |||
Marketable Securities Excluding Real Estate | 2,709.9 | 2,666.8 | |
Fair Value, Measurements, Recurring | United States Treasury securities | |||
Marketable securities: | |||
Marketable Securities Excluding Real Estate | 1,702.6 | 1,540.4 | |
Fair Value, Measurements, Recurring | Level 1: Quoted Prices in Active Markets for Identical Assets | |||
Marketable securities: | |||
Real estate related | 1,128.1 | 1,024.4 | |
Total Investments | 1,128.1 | 1,024.4 | |
Fair Value, Measurements, Recurring | Level 2: Significant Other Observable Inputs | |||
Marketable securities: | |||
Total Investments | 4,412.5 | 4,207.2 | |
Fair Value, Measurements, Recurring | Level 2: Significant Other Observable Inputs | Government agency notes | |||
Marketable securities: | |||
Marketable Securities Excluding Real Estate | 2,709.9 | 2,666.8 | |
Fair Value, Measurements, Recurring | Level 2: Significant Other Observable Inputs | United States Treasury securities | |||
Marketable securities: | |||
Marketable Securities Excluding Real Estate | 1,702.6 | 1,540.4 | |
Fair Value, Measurements, Recurring | Level 3: Significant Unobservable Inputs | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Real estate properties | 15,208.7 | 14,606.2 | |
Real estate joint ventures | 5,306 | 4,068.4 | |
Marketable securities: | |||
Loans receivable | 169.7 | 100.6 | |
Total Investments | 20,684.4 | 18,775.2 | |
Mortgage loans payable | $ (2,378.1) | $ (1,794.4) | |
[1] | Includes securities loaned of $108.6 million. |
Assets and Liabilities Measur27
Assets and Liabilities Measured at Fair Value on a Recurring Basis - Schedule of fair value assets and liabilities measured on recurring basis using unobservable inputs (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Total realized and unrealized gains (losses) included in changes in net assets | $ 77.7 | $ 261.7 | $ 427.4 | $ 1,019.3 |
Mortgage Loans Payable | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | (2,383.2) | (1,996.3) | (1,794.4) | (2,373.8) |
Total realized and unrealized gains (losses) included in changes in net liabilities | (29.1) | 11.4 | (54.8) | 3.5 |
Purchases | 0 | 0 | (563.5) | 0 |
Settlements | 34.2 | 153.2 | 34.6 | 538.6 |
Ending balance | (2,378.1) | (1,831.7) | (2,378.1) | (1,831.7) |
Real Estate Properties | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | 15,131.3 | 13,684.9 | 14,606.2 | 13,139 |
Total realized and unrealized gains (losses) included in changes in net assets | 53.3 | 166.5 | 268.7 | 624.6 |
Purchases | 82.1 | 362.1 | 486.7 | 1,071.3 |
Sales | (58) | 0 | (152.9) | (621.4) |
Ending balance | 15,208.7 | 14,213.5 | 15,208.7 | 14,213.5 |
Real Estate Joint Ventures | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | 4,238.9 | 3,256.3 | 4,068.4 | 3,022.1 |
Total realized and unrealized gains (losses) included in changes in net assets | 23.9 | 95 | 157.4 | 376.3 |
Purchases | 1,043.4 | 123.6 | 1,082.1 | 137.3 |
Settlements | (0.2) | (0.3) | (1.9) | (61.1) |
Ending balance | 5,306 | 3,474.6 | 5,306 | 3,474.6 |
Loans Receivable | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | 100.6 | 0 | 100.6 | 0 |
Total realized and unrealized gains (losses) included in changes in net assets | 0.1 | 0.1 | 0.1 | 0.1 |
Purchases | 69 | 100 | 69 | 100 |
Settlements | 0 | 0 | ||
Ending balance | 169.7 | 100.1 | 169.7 | 100.1 |
Total Level 3 Investments | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | 19,470.8 | 16,941.2 | 18,775.2 | 16,161.1 |
Total realized and unrealized gains (losses) included in changes in net assets | 77.3 | 261.6 | 426.2 | 1,001 |
Purchases | 1,194.5 | 585.7 | 1,637.8 | 1,308.6 |
Sales | (58) | 0 | (152.9) | (621.4) |
Settlements | (0.2) | (0.3) | (1.9) | (61.1) |
Ending balance | $ 20,684.4 | $ 17,788.2 | $ 20,684.4 | $ 17,788.2 |
Assets and Liabilities Measur28
Assets and Liabilities Measured at Fair Value on a Recurring Basis - Schedule of unobservable inputs related to Level 3 fair value measurements (Details) | 9 Months Ended |
Sep. 30, 2016 | |
Office | Real Estate Properties and Joint Ventures | Minimum | Discounted Cash Flow Analysis Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Discount Rate | 5.80% |
Terminal Capitalization Rate | 4.30% |
Office | Real Estate Properties and Joint Ventures | Minimum | Direct Capitalization Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Overall Capitalization Rate | 3.80% |
Office | Real Estate Properties and Joint Ventures | Maximum | Discounted Cash Flow Analysis Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Discount Rate | 8.50% |
Terminal Capitalization Rate | 7.30% |
Office | Real Estate Properties and Joint Ventures | Maximum | Direct Capitalization Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Overall Capitalization Rate | 7.00% |
Office | Real Estate Properties and Joint Ventures | Weighted Average | Discounted Cash Flow Analysis Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Discount Rate | 6.50% |
Terminal Capitalization Rate | 5.50% |
Office | Real Estate Properties and Joint Ventures | Weighted Average | Direct Capitalization Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Overall Capitalization Rate | 4.70% |
Industrial | Real Estate Properties and Joint Ventures | Minimum | Discounted Cash Flow Analysis Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Discount Rate | 5.70% |
Terminal Capitalization Rate | 4.80% |
Industrial | Real Estate Properties and Joint Ventures | Minimum | Direct Capitalization Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Overall Capitalization Rate | 4.00% |
Industrial | Real Estate Properties and Joint Ventures | Maximum | Discounted Cash Flow Analysis Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Discount Rate | 8.60% |
Terminal Capitalization Rate | 7.80% |
Industrial | Real Estate Properties and Joint Ventures | Maximum | Direct Capitalization Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Overall Capitalization Rate | 7.30% |
Industrial | Real Estate Properties and Joint Ventures | Weighted Average | Discounted Cash Flow Analysis Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Discount Rate | 6.70% |
Terminal Capitalization Rate | 5.60% |
Industrial | Real Estate Properties and Joint Ventures | Weighted Average | Direct Capitalization Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Overall Capitalization Rate | 5.00% |
Apartment | Real Estate Properties and Joint Ventures | Minimum | Discounted Cash Flow Analysis Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Discount Rate | 5.30% |
Terminal Capitalization Rate | 3.80% |
Apartment | Real Estate Properties and Joint Ventures | Minimum | Direct Capitalization Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Overall Capitalization Rate | 3.30% |
Apartment | Real Estate Properties and Joint Ventures | Maximum | Discounted Cash Flow Analysis Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Discount Rate | 7.30% |
Terminal Capitalization Rate | 5.80% |
Apartment | Real Estate Properties and Joint Ventures | Maximum | Direct Capitalization Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Overall Capitalization Rate | 5.30% |
Apartment | Real Estate Properties and Joint Ventures | Weighted Average | Discounted Cash Flow Analysis Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Discount Rate | 6.20% |
Terminal Capitalization Rate | 4.80% |
Apartment | Real Estate Properties and Joint Ventures | Weighted Average | Direct Capitalization Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Overall Capitalization Rate | 4.20% |
Apartment | Mortgage Loans Payable | Minimum | Discounted Cash Flow Analysis Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 29.40% |
Equivalency Rate | 2.40% |
Apartment | Mortgage Loans Payable | Minimum | Net Present Value Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 29.40% |
Weighted Average Cost of Capital Risk Premium Multiple | 1.20% |
Apartment | Mortgage Loans Payable | Maximum | Discounted Cash Flow Analysis Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 61.40% |
Equivalency Rate | 3.00% |
Apartment | Mortgage Loans Payable | Maximum | Net Present Value Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 61.40% |
Weighted Average Cost of Capital Risk Premium Multiple | 1.50% |
Apartment | Mortgage Loans Payable | Weighted Average | Discounted Cash Flow Analysis Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 41.70% |
Equivalency Rate | 2.70% |
Apartment | Mortgage Loans Payable | Weighted Average | Net Present Value Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 41.70% |
Weighted Average Cost of Capital Risk Premium Multiple | 1.30% |
Retail | Real Estate Properties and Joint Ventures | Minimum | Discounted Cash Flow Analysis Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Discount Rate | 5.00% |
Terminal Capitalization Rate | 4.50% |
Retail | Real Estate Properties and Joint Ventures | Minimum | Direct Capitalization Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Overall Capitalization Rate | 3.90% |
Retail | Real Estate Properties and Joint Ventures | Maximum | Discounted Cash Flow Analysis Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Discount Rate | 10.40% |
Terminal Capitalization Rate | 8.50% |
Retail | Real Estate Properties and Joint Ventures | Maximum | Direct Capitalization Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Overall Capitalization Rate | 8.30% |
Retail | Real Estate Properties and Joint Ventures | Weighted Average | Discounted Cash Flow Analysis Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Discount Rate | 6.40% |
Terminal Capitalization Rate | 5.20% |
Retail | Real Estate Properties and Joint Ventures | Weighted Average | Direct Capitalization Valuation Technique | Income Approach Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Overall Capitalization Rate | 4.70% |
Retail | Mortgage Loans Payable | Minimum | Discounted Cash Flow Analysis Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 18.40% |
Equivalency Rate | 2.50% |
Retail | Mortgage Loans Payable | Minimum | Net Present Value Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 18.40% |
Weighted Average Cost of Capital Risk Premium Multiple | 1.10% |
Retail | Mortgage Loans Payable | Maximum | Discounted Cash Flow Analysis Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 48.10% |
Equivalency Rate | 3.30% |
Retail | Mortgage Loans Payable | Maximum | Net Present Value Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 48.10% |
Weighted Average Cost of Capital Risk Premium Multiple | 1.30% |
Retail | Mortgage Loans Payable | Weighted Average | Discounted Cash Flow Analysis Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 31.30% |
Equivalency Rate | 3.00% |
Retail | Mortgage Loans Payable | Weighted Average | Net Present Value Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 31.30% |
Weighted Average Cost of Capital Risk Premium Multiple | 1.20% |
Office and Industrial | Mortgage Loans Payable | Minimum | Discounted Cash Flow Analysis Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 35.70% |
Equivalency Rate | 3.10% |
Office and Industrial | Mortgage Loans Payable | Minimum | Net Present Value Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 35.70% |
Weighted Average Cost of Capital Risk Premium Multiple | 1.20% |
Office and Industrial | Mortgage Loans Payable | Maximum | Discounted Cash Flow Analysis Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 49.80% |
Equivalency Rate | 3.90% |
Office and Industrial | Mortgage Loans Payable | Maximum | Net Present Value Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 49.80% |
Weighted Average Cost of Capital Risk Premium Multiple | 1.40% |
Office and Industrial | Mortgage Loans Payable | Weighted Average | Discounted Cash Flow Analysis Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 42.90% |
Equivalency Rate | 3.20% |
Office and Industrial | Mortgage Loans Payable | Weighted Average | Net Present Value Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 42.90% |
Weighted Average Cost of Capital Risk Premium Multiple | 1.30% |
Office, Retail and Storage | Loans Receivable | Minimum | Discounted Cash Flow Analysis Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 55.60% |
Equivalency Rate | 4.20% |
Office, Retail and Storage | Loans Receivable | Maximum | Discounted Cash Flow Analysis Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 79.20% |
Equivalency Rate | 8.30% |
Office, Retail and Storage | Loans Receivable | Weighted Average | Discounted Cash Flow Analysis Valuation Technique | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Loan to Value Ratio | 77.00% |
Equivalency Rate | 6.20% |
Assets and Liabilities Measur29
Assets and Liabilities Measured at Fair Value on a Recurring Basis - Schedule of net unrealized gains included in changes in net assets attributable to investments and mortgage loans payable (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Total realized and unrealized gains (losses) included in changes in net assets | $ 77.7 | $ 261.7 | $ 427.4 | $ 1,019.3 |
Mortgage Loans Payable | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Total realized and unrealized gains (losses) included in changes in net liabilities | (29.1) | 11.4 | (54.8) | 3.5 |
Real Estate Properties | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Total realized and unrealized gains (losses) included in changes in net assets | 53.9 | 166.5 | 270.1 | 640.7 |
Real Estate Joint Ventures | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Total realized and unrealized gains (losses) included in changes in net assets | 23.7 | 95.1 | 157.2 | 378.5 |
Loans Receivable | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Total realized and unrealized gains (losses) included in changes in net assets | $ 0.1 | $ 0.1 | $ 0.1 | $ 0.1 |
Mortgage Loans Payable (Details
Mortgage Loans Payable (Details) $ in Millions | 9 Months Ended | |
Sep. 30, 2016USD ($)loan | Dec. 31, 2015USD ($) | |
Mortgage Loans Payable [Line Items] | ||
Principal amount outstanding | $ 2,292.5 | $ 1,763.7 |
Second Street | ||
Mortgage Loans Payable [Line Items] | ||
Mortgage loans on real estate, number of loans | loan | 3 | |
Principal amount outstanding | $ 137.5 | $ 137.5 |
Second Street | Loan One | ||
Mortgage Loans Payable [Line Items] | ||
Principal amount outstanding | 79 | |
Second Street | Loan Two | ||
Mortgage Loans Payable [Line Items] | ||
Principal amount outstanding | 45 | |
Second Street | Loan Three | ||
Mortgage Loans Payable [Line Items] | ||
Principal amount outstanding | $ 13.5 |
Mortgage Loans Payable - Schedu
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2015 | |
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Principal amount outstanding | $ 2,292.5 | $ 1,763.7 |
Fair value adjustment | 85.6 | 30.7 |
Total mortgage loans payable | $ 2,378.1 | $ 1,794.4 |
Charleston Plaza | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 5.60% | 5.60% |
Annual interest rate and payment frequency | 5.60% paid monthly | |
Principal amount outstanding | $ 0 | $ 34.7 |
Maturity | Sep. 11, 2016 | |
The Legend at Kierland | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 4.97% | 4.97% |
Annual interest rate and payment frequency | 4.97% paid monthly | |
Principal amount outstanding | $ 21.8 | $ 21.8 |
Maturity | Aug. 1, 2017 | |
The Tradition at Kierland | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 4.97% | 4.97% |
Annual interest rate and payment frequency | 4.97% paid monthly | |
Principal amount outstanding | $ 25.8 | $ 25.8 |
Maturity | Aug. 1, 2017 | |
Mass Court | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 2.88% | 2.88% |
Annual interest rate and payment frequency | 2.88% paid monthly | |
Principal amount outstanding | $ 92.6 | $ 92.6 |
Maturity | Sep. 1, 2019 | |
Red Canyon at Palomino Park | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 5.34% | 5.34% |
Annual interest rate and payment frequency | 5.34% paid monthly | |
Principal amount outstanding | $ 27.1 | $ 27.1 |
Maturity | Aug. 1, 2020 | |
Green River at Palomino Park | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 5.34% | 5.34% |
Annual interest rate and payment frequency | 5.34% paid monthly | |
Principal amount outstanding | $ 33.2 | $ 33.2 |
Maturity | Aug. 1, 2020 | |
Blue Ridge at Palomino Park | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 5.34% | 5.34% |
Annual interest rate and payment frequency | 5.34% paid monthly | |
Principal amount outstanding | $ 33.4 | $ 33.4 |
Maturity | Aug. 1, 2020 | |
Ashford Meadows | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 5.17% | 5.17% |
Annual interest rate and payment frequency | 5.17% paid monthly | |
Principal amount outstanding | $ 44.6 | $ 44.6 |
Maturity | Aug. 1, 2020 | |
The Corner | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 4.66% | 4.66% |
Annual interest rate and payment frequency | 4.66% paid monthly | |
Principal amount outstanding | $ 105 | $ 105 |
Maturity | Jun. 1, 2021 | |
The Palatine | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 4.25% | 4.25% |
Annual interest rate and payment frequency | 4.25% paid monthly | |
Principal amount outstanding | $ 80 | $ 80 |
Maturity | Jan. 10, 2022 | |
The Forum at Carlsbad | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 4.25% | 4.25% |
Annual interest rate and payment frequency | 4.25% paid monthly | |
Principal amount outstanding | $ 90 | $ 90 |
Maturity | Mar. 1, 2022 | |
The Colorado | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 3.69% | 3.69% |
Annual interest rate and payment frequency | 3.69% paid monthly | |
Principal amount outstanding | $ 91.7 | $ 91.7 |
Maturity | Nov. 1, 2022 | |
The Legacy at Westwood | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 3.69% | 3.69% |
Annual interest rate and payment frequency | 3.69% paid monthly | |
Principal amount outstanding | $ 46.7 | $ 46.7 |
Maturity | Nov. 1, 2022 | |
Regents Court | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 3.69% | 3.69% |
Annual interest rate and payment frequency | 3.69% paid monthly | |
Principal amount outstanding | $ 39.6 | $ 39.6 |
Maturity | Nov. 1, 2022 | |
The Caruth | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 3.69% | 3.69% |
Annual interest rate and payment frequency | 3.69% paid monthly | |
Principal amount outstanding | $ 45 | $ 45 |
Maturity | Nov. 1, 2022 | |
Fourth And Madison | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 3.75% | 3.75% |
Annual interest rate and payment frequency | 3.75% paid monthly | |
Principal amount outstanding | $ 200 | $ 200 |
Maturity | Jun. 1, 2023 | |
Pennsylvania Avenue 1001 | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 3.70% | 3.70% |
Annual interest rate and payment frequency | 3.70% paid monthly | |
Principal amount outstanding | $ 330 | $ 330 |
Maturity | Jun. 1, 2023 | |
H Street 1401 | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 3.65% | 3.65% |
Annual interest rate and payment frequency | 3.65% paid monthly | |
Principal amount outstanding | $ 115 | $ 115 |
Maturity | Nov. 5, 2024 | |
Third Avenue 780 | Loan A | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 3.55% | 3.55% |
Annual interest rate and payment frequency | 3.55% paid monthly | |
Principal amount outstanding | $ 150 | $ 150 |
Maturity | Aug. 1, 2025 | |
Third Avenue 780 | Loan B | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 3.55% | 3.55% |
Annual interest rate and payment frequency | 3.55% paid monthly | |
Principal amount outstanding | $ 20 | $ 20 |
Maturity | Aug. 1, 2025 | |
Brickell Avenue | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 3.66% | 3.66% |
Annual interest rate and payment frequency | 3.66% paid monthly | |
Principal amount outstanding | $ 184 | $ 0 |
Maturity | Apr. 1, 2026 | |
Second Street | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 3.74% | 3.74% |
Annual interest rate and payment frequency | 3.74% paid monthly | |
Principal amount outstanding | $ 137.5 | $ 137.5 |
Maturity | Oct. 1, 2026 | |
K Street | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 3.93% | 3.93% |
Annual interest rate and payment frequency | 3.93% paid monthly | |
Principal amount outstanding | $ 163 | $ 0 |
Maturity | Apr. 1, 2028 | |
Boylston Street | ||
Mortgage Loans Payable - Schedule of outstanding mortgage loans payable secured by properties [Line Items] | ||
Annual interest rate | 3.70% | 3.70% |
Annual interest rate and payment frequency | 3.70% paid monthly | |
Principal amount outstanding | $ 216.5 | $ 0 |
Maturity | Apr. 1, 2028 |
Financial Highlights - Schedule
Financial Highlights - Schedule of condensed financial information for an accumulation unit of the account (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 9 Months Ended | 12 Months Ended | |||||
Sep. 30, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Jun. 30, 2016 | Sep. 30, 2015 | Jun. 30, 2015 | |
Per Accumulation Unit Data: | |||||||
Rental income (in dollars per share) | $ 12.311 | $ 15.538 | $ 15.862 | $ 15.313 | |||
Real estate property level expenses and taxes (in dollars per share) | 5.598 | 7.319 | 7.788 | 8.112 | |||
Real estate income, net (in dollars per share) | 6.713 | 8.219 | 8.074 | 7.201 | |||
Other income (in dollars per share) | 2.435 | 3.342 | 3.459 | 2.759 | |||
Total income (in dollars per share) | 9.148 | 11.561 | 11.533 | 9.960 | |||
Expense charges (in dollars per share) | 2.451 | 3.092 | 2.880 | 2.672 | |||
Investment income, net (in dollars per share) | 6.697 | 8.469 | 8.653 | 7.288 | |||
Net realized and unrealized gain on investments and mortgage loans payable (in dollars per share) | 7.436 | 18.911 | 27.868 | 19.015 | |||
Net increase in Accumulation Unit Value (in dollars per share) | 14.133 | 27.380 | 36.521 | 26.303 | |||
Accumulation Unit Value: | |||||||
Beginning of period (in dollars per share) | 362.773 | 335.393 | 298.872 | 272.569 | |||
End of period (in dollars per share) | $ 376.906 | $ 362.773 | $ 335.393 | $ 298.872 | |||
Total return | 3.90% | 8.16% | 12.22% | 9.65% | |||
Ratios to Average net assets: | |||||||
Expenses | 0.86% | 0.86% | 0.89% | 0.92% | |||
Investment income, net | 2.35% | 2.37% | 2.68% | 2.50% | |||
Portfolio turnover rate: | |||||||
Real estate properties | 0.80% | 5.70% | 6.50% | 2.10% | |||
Marketable securities | 2.80% | 10.00% | 15.90% | 8.40% | |||
Accumulation Units outstanding at end of period (in millions) (in shares) | 62.4 | 60.4 | 57.9 | 55.3 | |||
Net assets end of period (in millions) | $ 24,011.5 | $ 22,360 | $ 19,829 | $ 16,907.9 | $ 23,678.2 | $ 21,694.5 | $ 21,095.9 |
Accumulation Units - Schedule o
Accumulation Units - Schedule of changes in the number of accumulation units outstanding (Details) - shares shares in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Outstanding: | ||
Beginning of period (in shares) | 60.4 | 57.9 |
Credited for premiums (in shares) | 6.3 | 8.1 |
Annuity, other periodic payments, withdrawals and death benefits (in shares) | (4.3) | (5.6) |
End of period (in shares) | 62.4 | 60.4 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Commitments and Contingencies [Line Items] | ||
Callable commitments, amount | $ 37.7 | $ 45 |
Minimum | ||
Commitments and Contingencies [Line Items] | ||
Minority interest, ownership percentage by noncontrolling owners upon funding | 60.00% | |
Maximum | ||
Commitments and Contingencies [Line Items] | ||
Minority interest, ownership percentage by noncontrolling owners upon funding | 90.00% |
Securities Lending (Details)
Securities Lending (Details) | 9 Months Ended |
Sep. 30, 2016 | |
Receivables [Abstract] | |
Minimum cash collateral maintained, percentage | 102.00% |