SECURITIES AND EXCHANGE COMMISSION
(Mark One)
ýx ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 20112014 ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period fromto Commission file number 1-9876
Weingarten Realty Investors
(Exact name of registrant as specified in its charter)
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| TEXAS | | 74-1464203 |
| (State or other jurisdiction of incorporation or organization) | | (I.R.S. Employer Identification No.) |
2600 Citadel Plaza Drive | | |
| P.O. Box 924133 | |
| Houston, Texas | 77292-4133 |
Houston, Texas | | 77292-4133 |
| (Address of principal executive offices) | | (Zip Code) |
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
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Title of Each Class | | Name of Each Exchange on Which Registered |
Common Shares of Beneficial Interest, $0.03 par value | | New York Stock Exchange |
Series D Cumulative Redeemable Preferred Shares, $0.03 par value
| | New York Stock Exchange |
Series E Cumulative Redeemable Preferred Shares, $0.03 par value
| | New York Stock Exchange |
Series F Cumulative Redeemable Preferred Shares, $0.03 par value | | New York Stock Exchange |
8.1% Notes due 2019
| | New York Stock Exchange |
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES xý NO ¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. xý Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
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| | Large accelerated filer xý | | Accelerated filer ¨ |
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| | (Do not check if a smaller reporting company) | | Smaller reporting company ¨ |
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
The aggregate market value of the common shares of beneficial interest held by non-affiliates on June 30, 20112014 (based upon the most recent closing sale price on the New York Stock Exchange as of $25.16)such date of $32.84) was $2,788,154,566.$3.7 billion.
As of January 31, 2012,2015, there were 120,846,358122,505,338 common shares of beneficial interest outstanding. DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant’s Proxy Statement relating to its Annual Meeting of Shareholders to be held on May 8, 2012April 28, 2015 have been incorporated by reference to Part III of this Form 10-K.
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Forward-Looking Statements
This annual report on Form 10-K, together with other statements and information publicly disseminated by us, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and include this statement for purposes of complying with
thesethose safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, are generally identifiable by use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project,” or similar expressions. You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors, which are, in some cases, beyond our control and which could materially affect actual results, performances or achievements. Factors which may cause actual results to differ materially from current expectations include, but are not limited to, (i) disruptions in financial markets, (ii) general economic and local real estate conditions, (iii) the inability of major tenants to continue paying their rent obligations due to bankruptcy, insolvency or general downturn in their business, (iv) financing risks, such as the inability to obtain equity, debt, or other sources of financing on favorable terms, (v) changes in governmental laws and regulations, (vi) the level and volatility of interest rates, (vii) the availability of suitable acquisition opportunities, (viii) the ability to dispose
of properties, (ix) changes in expected development activity, (x) increases in operating costs, (xi) tax matters, including failure to qualify as a real estate investment trust,
could have adverse consequences and (xii) investments through real estate joint ventures and partnerships,
which involve risks not present in investments in which we are the sole investor. Accordingly, there is no assurance that our expectations will be realized. For further discussion of the factors that could materially affect the outcome of our forward-looking statements and our future results and financial condition, see “Item 1A. Risk Factors.”
PART I
ITEM 1. Business
General Development of BusinessGeneral. Weingarten Realty Investors is a real estate investment trust (“REIT”) organized under the Texas Business Organizations Code. We, and our predecessor entity, began the ownership and development of shopping centers and other commercial real estate in 1948. Our primary business is leasing space to tenants in the shopping and industrial centers we own or lease. We also provide property management services for bothwhich we charge fees to either joint ventures in whichwhere we are partners and foror other outside ownersowners.
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in Item 7 and the Consolidated Financial Statements and Notes thereto included in Item 8 of this Annual Report on Form 10-K for which we charge fees.the year ended At December 31, 2011,2014, for information on certain recent developments of the Company.
Financial Information about Segments. We are in the business of owning, managing and developing retail shopping centers. As each of our centers has similar characteristics and amenities, our operations have been aggregated into one reportable segment. See the Consolidated Financial Statements and Notes thereto included in Item 8 of this Annual Report on Form 10-K for further information regarding reportable segments.
Narrative Description of Business. At December 31, 2014, we owned or operated under long-term leases, either directly or through our interest in real estate joint ventures or partnerships, a total of 380234 developed income-producing properties and 11three properties under various stages of construction and development. The total number of properties includes 313 neighborhood and community shopping centers, 75 industrial projects and three other operating propertiesdevelopment, which are located in 2321 states spanning the country from coast to coast. The portfolio of properties contains approximately 45.3 million square feet of gross leasable area that is approximately 76.1 million square feet.either owned by us or others.
We also owned interests in 4034 parcels of land held for development that totaled approximately 30.025.3 million square feet. At December 31, 2011,2014, we employed 370315 full-time persons; our principal executive offices are located at 2600 Citadel Plaza Drive, Houston, Texas 77008; and our phone number is (713) 866-6000. We also have 10 regional offices located in various parts of the United States (“U.S.”).Financial Information about Segments. We are primarily in the business
Investment and Operating Strategy. Our strategygoal is to remain a leader in owning and operating top tiertop-tier neighborhood and community shopping centers in certain markets of the U.S. We will accomplishexpect to achieve this by focusinggoal by:
strategic focus on core operating fundamentals through continuing our hands-ondecentralized operating platform built on local expertise in leasing and management, property management;
selective redevelopment of the existing portfolio of properties in order to enhance and maintain high quality centers;
disciplined growth from strategic acquisitions and new developments and developments;
disposition of assets that no longer meet our ownership criteria. We remain committedcriteria, in which proceeds may be recycled by repaying debt, purchasing new assets or reinvesting in currently owned assets or for other corporate purposes; and
commitment to maintaining a conservatively leveraged balance sheet, a well-staggered debt maturity schedule and strong credit agency ratings.
During 2011, we announced our strategic initiative to dispose of over $600 million of non-core operating properties over the next few years, which will recycle capital for growth opportunities and strengthen our operating fundamentals. In the course of executing this disposition plan, given proper pricing, we will consider selling both retail and industrial properties. To date, we have successfully disposed of $155.6 million, either directly or through our interest in real estate joint ventures or partnerships, and have approximately $76.9 million currently under contracts or letters of intent.
The proceeds generated by this program will be used to reduce outstanding debt, further deleveraging our balance sheet. Furthermore, we will have positioned ourselves to take advantage of growth opportunities as they present themselves as the economy improves. Competition for quality acquisition opportunities remains substantial; nevertheless, we have been successful in identifying selected properties that meet our return hurdles, and we will continue to actively evaluate other opportunities as they enter our target markets.
We may either purchase or lease income-producing properties in the future, and may also participate with other entities in property ownership through partnerships, joint ventures or similar types of co-ownership.
Equity investments may be subject to existing mortgage financing and other indebtedness or such financing may be incurred in connection with acquiring such investments.We may invest in mortgages; however, we have traditionally invested in first mortgages to real estate joint ventures or partnerships in which we own an equity interest or to obtain control over a real estate asset that we desire to own. We may also invest in securities of other issuers for the purpose, among others, of exercising control over such entities, subject to the gross income and asset tests necessary for REIT qualification.
In acquiring and developing properties, we attempt to accumulate enough properties in a geographic area to allow for the establishment of a regional office, which enables us to obtain in-depth knowledge of the market from a leasing perspective and to have easy access to the property and our tenants from a management viewpoint.
At December 31, 2011, neighborhood and community shopping centers generated 89.0% of total revenue and industrial properties accounted for 9.1%.
We expect to continue our focus on the future growth of the portfolio in neighborhood and community
shopping centers in markets where we currently operate and may expand to other markets throughout the U.S.
Our markets of interest reflect high income and job growth, as well as high barriers-to-entry. Our attention is also focused on high quality, supermarket-anchored and necessity-based centers.
Diversification from both a geographic and tenancy perspective is a critical component of our operating strategy. WhileWe continue to seek opportunities outside the Texas market, where approximately 32.7%27.8% of the building square footagegross leasable area of our properties is located, down from 28.2% in Texas, we continue to look for opportunities to expand our holdings outside the state.2013. With respect to tenant diversification, our two largest tenants, The Kroger Co. and TJX Companies, Inc., accounted for 3.2%3.5% and 2.0%2.3%, respectively, of our total base minimum rental revenues for the year ended December 31, 2011.2014. No other tenant accounted for more than 1.8% of our total base minimum rental revenues. Our anchor tenants are supermarkets, value-oriented apparel/discount stores and other retailers or service providers who generally sell basic necessity-type goods and services. We believe the stability of our anchor tenants, combined with convenient locations, attractive and well-maintained properties, high quality retailers and a strong tenant mix, should ensure the long-term success of our merchants and the viability of our portfolio.
Strategically, we strive to finance our growth and working capital needs in a conservative manner.manner, including managing our debt maturities. Our senior debt credit ratings were BBB with a projected stable outlook from Standard & Poors and Baa2 with a projected positive outlook from Moody’s Investor Services as of December 31, 2011 and 2010.2014. We intend to maintain a conservative approach to managing our balance sheet, which, in turn, givesshould give us many options offor raising debt or equity capital when needed. At December 31, 2011,2014 and 2013, our ratio of earnings to combined fixed charges and preferred dividends as defined by the Securities and Exchange Commission (“SEC”), not based on funds from operations, was 1.043.09 to 1 and our1.72 to 1, respectively. Our debt to total assets before depreciation ratio was 44.7%.40.0% and 43.5% at
December 31, 2014 and 2013, respectively. Our policies with respect to the investment and operating strategies discussed above are periodically reviewed by our Board of Trust Managers and may be modified without a vote of our shareholders.
Location of Properties. Our properties are located in 2321 states, primarily throughout the southern half of the country. As of December 31, 2011,2014, we have 391237 properties which(including three properties under development) that were owned or operated under long-term leases, either directly or through our interestsinterest in real estate joint ventures or partnerships. NetTotal revenues less operating expenses and real estate taxes from continuing operations ("net operating income from continuing operations") generated by our properties located in Houston and its surrounding areas was 21.7%19.7% of total net operating income from continuing operations for the year ended December 31, 2014, and an additional 11.6%9.8% of net operating income isfrom continuing operations was generated in 2014 from properties that are located in other parts of Texas. WeAs of December 31, 2014, we also have 40had 34 parcels of land held for development, 11eight of which arewere located in Houston and its surrounding areas and nine12 of which arewere located in other parts of Texas. Because of our investments in Houston and its surrounding areas, as well as in other parts of Texas, the Houston and Texas economies affect, to a large degree, our business and operations. Economic Factors. While downside risks still exist, most economic indicators suggest that the economic recovery is gaining strength. Consumer confidence has begun to rebound from historical low levels, credit availability is improving, and retail sales showed growth through 2011. Sales will likely continue to trend upward though at a decreased rate, causing year over year comparisons to be more difficult. Overall, we expect the improved gross sales to translate into a stronger demand for retail space which should lead to lower vacancy rates and more stable rents beyond 2012. With the majority of our shopping centers being supermarket-anchored and located in densely populated, major metropolitan areas, our portfolio came through the recession stronger than centers anchored by tenants with more discretionary product lines.CompetitionOur market analysis has identified stronger interest for top tier shopping centers where easier availability for credit has resulted in higher prices. Second and third tier properties have continued to see pricing constraints. In light of these trends, we have continued to dedicate internal resources to evaluate available assets in our key markets and to identify and purchase the best assets and properties with the strongest upside potential.
Competition. We compete with numerous other developers and real estate companies (both public and private), financial institutions and other investors engaged in the development, acquisition and operation of shopping centers and commercial property in our trade areas. This results in competition for the acquisition of both existing income-producing properties and prime development sites. Competition for these acquisitions may also increase as credit availability improves resulting in additional pricing pressure.
We also compete for tenants to occupy the space that is developed, acquired and managed by our
competitors or us.competitors. The principal competitive factors in attracting tenants in our market areas are location, price, anchor tenants and maintenance of properties. We believe our key competitive advantages include the favorable locations of our properties,
the strong demographics surrounding our centers, knowledge of markets and customer bases, our ability to provide a retailer with multiple locations with
quality anchor tenants and the practice of continuous maintenance and renovation of our properties.
Qualification as a Real Estate Investment Trust. As of December 31, 2014, we met the qualification requirements of a REIT under the Internal Revenue Code, as amended. As a result, we will not be subject to federal income tax to the extent we meet certain requirements of the Internal Revenue Code, with the exception of our taxable REIT subsidiary.
Materials Available on Our Website. Copies of our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and any amendments to those reports, as well as Reports on Forms 3, 4, 5 and SC 13G regarding our officers, trust managers or 10% beneficial owners, filed or furnished pursuant to Section 13(a), 15(d) or 16(a) of the Securities Exchange Act of 1934 are available free of charge through our website (www.weingarten.com) as soon as reasonably practicable after we electronically file the material with, or furnish it to, the SEC. We have also made available on our website copies of our Audit Committee Charter, Management Development and Executive Compensation Committee Charter, Governance and Nominating Committee Charter, Code of Conduct and Ethics, Code of Ethical Conduct for Officers and Senior Financial Associates and Governance Guidelines.Policies. In the event of any changes to these charters, codes or the code or guidelines,policies, changed copies will also be made available on our website. You may also read and copy any materials we file with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, D.C. 20549 or the SEC’s Internet site atwww.sec.gov. Materials on our website are not part of our Annual Report on Form 10-K. Financial Information. Additional financial information concerning us is included in the Consolidated Financial Statements located on pages 44 through 89in Item 8 herein. ITEM 1A. Risk Factors
The risks described below could materially and adversely affect
our shareholders and our results of operations, financial condition, liquidity and cash flows. In addition to these risks, our operations may also be affected by additional factors not presently known or that we currently consider immaterial to our operations.
Disruptions in the financial markets could affect our liquidity and have other adverse effects on us and the market price of our common shares of beneficial interest.
The U.S. and global equity and credit markets
canhave experienced and may in the future experience significant price volatility, dislocations and liquidity disruptions, which could cause market prices of many stocks to fluctuate substantially and the spreads on prospective debt financings to widen considerably. These circumstances could materially impact liquidity in the financial markets, making terms for certain financings less attractive, and in certain cases result in the unavailability of certain types of financing. Uncertainties in the equity and credit markets may negatively impact our ability to access additional financing at reasonable terms or at all, which may negatively affect our ability to complete dispositions, form joint ventures or refinance our debt. A prolonged downturn in the equity or credit markets could cause us to seek alternative sources of potentially less attractive financing, and require us to adjust our business plan accordingly. In addition, these factors may make it more difficult for us to sell properties or adversely affect the price we receive for properties that we do sell, as prospective buyers may experience increased costs of financing or difficulties in obtaining financing. These events in the equity and credit markets may make it more difficult or costly for us to raise capital through the issuance of our common shares of beneficial interest (“common shares”) or preferred shares. These disruptions in the financial markets also may have a material adverse effect on the market value of our common shares and preferred shares and other adverse effects on us or the economy generally. There can be no assurances that government responses to the disruptions in the financial markets will
continue to restore consumer confidence,
stabilize themaintain stabilized markets or
increase liquidity andcontinue to provide the availability of equity or credit financing.
Among the market conditions that may affect the value of our common shares and preferred shares
and access to the capital markets are the following:
| ¡ | | The attractiveness of REIT securities as compared to other securities, including securities issued by other real estate companies, fixed income equity securities and debt securities;
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| ¡ | | Changes in revenues or earnings estimates or publication of research reports and recommendations by financial analysts or actions taken by rating agencies with respect to our securities or those of other REITs;
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| ¡ | | The degree of interest held by institutional investors;
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| ¡ | | Speculation in the press or investment community;
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| ¡ | | The ability of our tenants to pay rent to us and meet their other obligations to us under current lease terms;
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| ¡ | | Our ability to re-lease space as leases expire;
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| ¡ | | Our ability to refinance our indebtedness as it matures;
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| ¡ | | Actual or anticipated quarterly fluctuations in our operating results and financial condition;
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| ¡ | | Any changes in our distribution policy;
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| ¡ | | Any future issuances of equity securities;
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| ¡ | | Strategic actions by us or our competitors, such as acquisitions or restructurings;
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| ¡ | | General market conditions and, in particular, developments related to market conditions for the real estate industry; and
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| ¡ | | Domestic and international economic and political factors unrelated to our performance.
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The attractiveness of REIT securities as compared to other securities, including securities issued by other real estate companies, fixed income equity securities and debt securities;
Changes in revenues or earnings estimates or publication of research reports and recommendations by financial analysts or actions taken by rating agencies with respect to our securities or those of other REITs;
The degree of interest held by institutional investors;
The market's perception of the quality of our assets and our growth potential;
The ability of our tenants to pay rent to us and meet their other obligations to us under current lease terms;
Our ability to re-lease space as leases expire;
Our ability to refinance our indebtedness as it matures;
Actual or anticipated quarterly fluctuations in our operating results and financial condition;
Any changes in our distribution policy;
Any future issuances of equity securities;
Strategic actions by us or our competitors, such as acquisitions or restructurings;
General market conditions and, in particular, developments related to market conditions for the real estate industry; and
Domestic and international economic and political factors unrelated to our performance.
The volatility in the stock market can create price and volume fluctuations that may not necessarily be comparable to operating performance.
The economic performance and value of our shopping centers depend on many factors, each of which could have an adverse impact on our cash flows and operating results.
The economic performance and value of our properties can be affected by many factors, including the following:
| ¡ | | Changes in the national, regional and local economic climate;
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| ¡ | | Changes in environmental regulatory requirements including, but not limited to, legislation on global warming;
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| ¡ | | Local conditions such as an oversupply of space or a reduction in demand for real estate in the area;
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| ¡ | | The attractiveness of the properties to tenants;
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| ¡ | | Competition from other available space;
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| ¡ | | Our ability to provide adequate management services and to maintain our properties;
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| ¡ | | Increased operating costs, if these costs cannot be passed through to tenants;
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| ¡ | | The cost of periodically renovating, repairing and releasing spaces;
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| ¡ | | Consequence of any armed conflict involving, or terrorist attack against, the U.S.;
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| ¡ | | Our ability to secure adequate insurance;
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| ¡ | | Fluctuations in interest rates;
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| ¡ | | Changes in real estate taxes and other expenses; and
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| ¡ | | Availability of financing on acceptable terms or at all.
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Changes in the national, regional and local economic climate;
Changes in environmental regulatory requirements including, but not limited to, legislation on global warming;
Local conditions such as an oversupply of space or a reduction in demand for real estate in the area;
The attractiveness of the properties to tenants;
Competition from other available space;
Competition for our tenants from Internet sales;
Our ability to provide adequate management services and to maintain our properties;
Increased operating costs, if these costs cannot be passed through to tenants;
The cost of periodically renovating, repairing and releasing spaces;
The consequences of any armed conflict involving, or terrorist attack against, the U.S.;
Our ability to secure adequate insurance;
Fluctuations in interest rates;
Changes in real estate taxes and other expenses; and
Availability of financing on acceptable terms or at all.
Our properties consist primarily of neighborhood and community shopping centers and, therefore, our performance is linked to general economic conditions in the market for retail space. The market for retail space has been and
may continue tocould in the future be adversely affected by weakness in the national, regional and local economies where our properties are located, the adverse financial condition of some large retail companies, the ongoing consolidation in the retail sector, the excess amount of retail space in a number of markets and increasing consumer purchases through
catalogues and the Internet. To the extent that any of these conditions
occur,exist, they are likely to affect market rents for retail space. In addition, we may face challenges in the management and maintenance of the properties or encounter increased operating costs, such as real estate taxes, insurance and utilities, which may make our properties unattractive to tenants.
A significant decrease in rental revenue and an inability to replace such revenues may adversely affect our profitability, the ability to meet debt and other financial obligations and make distributions to shareholders.
We have a high concentration of properties in the state of Texas, and adverse economic or other conditions in that area could have a material adverse effect on us.
We are particularly susceptible to adverse economic or other conditions in the state of Texas, including increased unemployment, industry slowdowns, including declining oil prices, business layoffs or downsizing, decreases in consumer confidence, relocations of businesses, changes in demographics, increases in real estate and other taxes, increases in regulations and natural disasters, any of which could have an increased material adverse effect on us than if our portfolio was more geographically diverse.
Our acquisition activities may not produce the cash flows that we expect and may be limited by competitive pressures or other factors.
We intend to acquire existing commercial properties to the extent that suitable acquisitions can be made on advantageous terms. Acquisitions of commercial properties involve risks such as:
| ¡ | | Our estimates on expected occupancy and rental rates may differ from actual conditions;
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| ¡ | | Our estimates of the costs of any redevelopment or repositioning of acquired properties may prove to be inaccurate;
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| ¡ | | We may be unable to operate successfully in new markets where acquired properties are located, due to a lack of market knowledge or understanding of local economies;
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| ¡ | | We may be unable to successfully integrate new properties into our existing operations; or
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| ¡ | | We may have difficulty obtaining financing on acceptable terms or paying the operating expenses and debt service associated with acquired properties prior to sufficient occupancy.
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We may have difficulty identifying acquisition opportunities that fit our investment strategy;
Our estimates on expected occupancy and rental rates may differ from actual conditions;
Our estimates of the costs of any redevelopment or repositioning of acquired properties may prove to be inaccurate;
We may be unable to operate successfully in new markets where acquired properties are located, due to a lack of market knowledge or understanding of local economies;
We may be unable to successfully integrate new properties into our existing operations; or
We may have difficulty obtaining financing on acceptable terms or paying the operating expenses and debt service associated with acquired properties prior to sufficient occupancy.
In addition, we may not be in a position or have the opportunity in the future to make suitable property acquisitions on advantageous terms due to competition for such properties with others engaged in real estate investment. Our inability to successfully acquire new properties may have an adverse effect on our results of operations.
Turmoil in capital markets could adversely impact acquisition activities and pricing of real estate assets.
Volatility in
the capital markets could
adversely affect acquisition activities by impacting certainimpact the availability of debt financing due to numerous factors, including the tightening of underwriting standards by lenders and credit rating
agencies and the significant inventory of unsold collateralized mortgage-backed securities (“CMBS”) in the market.agencies. These factors directly affect a lender’s ability to provide debt financing as well as increase the cost of available debt financing. As a result, we may not be able to obtain
favorable debt financing
in the futureon favorable terms or at all. This may result in future acquisitions generating lower overall economic returns, which may adversely affect our results of operations and distributions to shareholders. Furthermore, any turmoil in the capital markets could adversely impact the overall amount of capital available to invest in real estate, which may result in price or value decreases of real estate assets.
Adverse global market and economic conditions may continue to adversely affect us and could cause us to recognize additional impairment charges or otherwise harm our performance.
Market and economic conditions have been unprecedented and challenging with tighter credit conditions. Continued concerns about the systemic impact of the availability and cost of credit, ongoing volatility in European capital markets, the U.S. mortgage market, inflation, energy costs, geopolitical issues and declining equity and
Our real estate markets have contributed to increased market volatility and diminished expectations for the U.S. economy. The retail shopping sector has been negatively affected by these market and economic conditions. These conditions may result in our tenants delaying lease commencements, declining to extend or renew leases upon expiration and/or renewing at lower rates. These conditions also have forced some weaker retailers, in some cases, to declare bankruptcy and/or close stores. Certain retailers have announced store closings even though they have not filed for bankruptcy protection. Lease terminations by certain tenants or a failure by certain tenants to occupy their premises in a shopping center could result in lease terminations or significant reductions in rent by other tenants in the same shopping center under the terms of some leases, in which case weassets may be unablesubject to re-leaseimpairment charges.
Periodically, we assess whether there are any indicators that the
vacated space at attractive rents or at all, and our rental payments from our continuing tenants could significantly decrease. Additionally, adverse conditions could also result in the revaluationvalue of
our investments in real estate joint ventures and partnerships, notes receivable from our real estate
joint venturesassets, including any capitalized costs and
partnershipsany identifiable intangible assets, may be impaired. A property's value is impaired only if the estimate of the aggregate future undiscounted cash flows without interest charges to be generated by the property are less than the carrying value of the property. In estimating cash flows, we consider factors such as expected future operating income, trends and prospects, the effects of demand, competition and other
factors. If we are evaluating the potential sale of an asset or development alternatives, the undiscounted future cash flows consider the most likely course of action at the balance sheet date based on current plans, intended holding periods and available market information. Determining whether a property
related investments.We are unableis impaired and, if impaired, the amount of write-down to predict whether,fair value requires a significant amount of judgment by management and is based on the best information available to management at the time of evaluation. If market conditions deteriorate or to what extent ormanagement’s plans for how long, thesecertain properties change, additional write-downs could be required in the future, and any future impairment could have a material adverse market and economic conditions will persist. The continuation and/or intensificationeffect on our results of these conditions may impede our ability to generate sufficient operating cash flow to pay expenses, maintain properties, pay dividends and refinance debt.
operations in the period in which the charge is taken.
Reduction of rental income would adversely affect our profitability, our ability to meet our debt obligations and our ability to make distributions to our shareholders.
The substantial majority of our income is derived from rental income from real property. As a result, our performance depends on our ability to collect rent from tenants. Our income and funds for distribution would be negatively affected if a significant number of our tenants, or any of our major tenants (as discussed in more detail below):
| ¡ | | Delay lease commencements;
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| ¡ | | Decline to extend or renew leases upon expiration;
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| ¡ | | Fail to make rental payments when due; or
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| ¡ | | Close stores or declare bankruptcy.
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Delay lease commencements;
Decline to extend or renew leases upon expiration;
Fail to make rental payments when due; or
Close stores or declare bankruptcy.
Any of these actions could result in the termination of the tenants’ lease and the loss of rental income attributable to the terminated leases. In addition, lease terminations by an anchor tenant or a failure by that anchor tenant to occupy the premises could also result in lease terminations or reductions in rent by other tenants in the same shopping
centerscenter under the terms of some leases. In these events, we cannot be sure that any tenant whose lease expires will renew that lease or that we will be able to re-lease space on economically advantageous terms.
Furthermore, certain costs remain fixed even though a property may not be fully occupied. The loss of rental revenues from a number of our tenants and our inability to replace such tenants, particularly in the case of a substantial tenant with leases in multiple locations, may adversely affect our profitability, our ability to meet debt and other financial obligations and our ability to make distributions to the shareholders.
Adverse effects on the success and stability of our anchor tenants, could lead to reductions of rental income.
Our rental income could be adversely affected in the event of a downturn in the business, or the bankruptcy or insolvency of any anchor store or anchor tenant. Anchor tenants generally occupy large amounts of square footage, pay a significant portion of the total rents at a property and contribute to the success of other tenants by drawing significant numbers of customers to a property. The closing of one or more anchor stores at a property could adversely affect that property and result in lease terminations or reductions in rent from other tenants, whose leases may permit termination or rent reduction in those circumstances or whose own operations may suffer as a result. Furthermore, tenant demand for certain of our anchor spaces may decrease, and as a result, we may see an increase in vacancy and/or a decrease in rents for those spaces, which could have a negative impact to our rental income.
We face significant competition in the leasing market, which may decrease or prevent increases in the occupancy and rental rates of our properties.
We compete with numerous developers, owners and operators of retail properties, many of which own properties similar to, and in the same market sectors as, our properties. If our competitors offer space at rental rates below current market rates, or below the rental rates we currently charge our tenants, we may lose existing or potential tenants, or we may be forced to reduce rental rates in order to attract new tenants and retain existing tenants when their leases expire.
Also, if our competitors develop additional retail properties in locations near our properties, there may be increased competition for customer traffic and creditworthy tenants, which may result in fewer tenants or decreased cash flows from tenants, or both, and may require us to make capital improvements to properties that we would not have otherwise made. Our tenants also face increasing competition from other forms of marketing of goods, such as direct mail and Internet marketing, which may decrease cash flow from such tenants. As a result, our financial condition and our ability to make distributions to our shareholders may be adversely affected.
We may be unable to collect balances due from tenants in bankruptcy.
A tenant that files for bankruptcy protection may not continue to pay us rent. A bankruptcy filing by or relating to one of our tenants or a lease guarantor would bar all efforts by us to collect pre-bankruptcy debts from the tenant or the lease guarantor, or their property, unless the bankruptcy court permits us to do so. A tenant or lease guarantor bankruptcy could delay our efforts to collect past due balances under the relevant leases and could ultimately preclude collection of these sums. If a lease is rejected by a tenant in bankruptcy, we would have only a general unsecured claim for damages. As a result, it is likely that we would recover substantially less than the full value of any unsecured claims it holds, if at all.
Ongoing adverse market and economic conditions and market volatility will likely continue to make it difficult to value the properties and investments owned by us and our unconsolidated joint ventures. There may be significant uncertainty in the valuation, or in the stability of the value, of such properties and investments that could result in a substantial decrease in the value thereof. In addition, we intend to sell certain assets over the next several years. No assurance can be given that we will be able to recover the current carrying amount of all of our properties and those of our unconsolidated joint ventures and/or our goodwill in the future. Our inability to do so would require us to recognize additional impairment charges for the period in which we reached that conclusion, which could materially and adversely affect us.
Our development and construction activities could adversely affect our operating results.
We intend to continue the selective development and construction of retail properties in accordance with our development and underwriting policies as opportunities arise. Our development and construction activities include risks that:
| ¡ | | We may abandon development opportunities after expending resources to determine feasibility;
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| ¡ | | Construction costs of a project may exceed our original estimates;
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| ¡ | | Occupancy rates and rents at a newly completed property may not be sufficient to make the property profitable;
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| ¡ | | Rental rates could be less than projected;
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| ¡ | | Project completion may be delayed because of a number of factors, including weather, labor disruptions, construction delays or delays in receipt of zoning or other regulatory approvals, adverse economic conditions, acts of terror or other acts of violence, or acts of God (such as fires, earthquakes or floods);
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| ¡ | | Financing may not be available to us on favorable terms for development of a property;
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| ¡ | | We may not complete construction and lease-up on schedule, resulting in increased debt service expense and construction costs; and
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| ¡ | | We may not be able to obtain, or may experience delays in obtaining necessary zoning, land use, building, occupancy and other required governmental permits and authorizations.
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We may abandon development opportunities after expending resources to determine feasibility;
Construction costs of a project may exceed our original estimates;
Occupancy rates and rents at a newly completed property may not be sufficient to make the property profitable;
Rental rates could be less than projected;
Project completion may be delayed because of a number of factors, including weather, labor disruptions, construction delays or delays in receipt of zoning or other regulatory approvals, adverse economic conditions, acts of terror or other acts of violence, or acts of God (such as fires, earthquakes or floods);
Financing may not be available to us on favorable terms for development of a property; and
We may not complete construction and lease-up on schedule, resulting in increased debt service expense and construction costs.
Additionally, the time frame required for development, construction and lease-up of these properties means that we may have to wait years for a significant cash return. If any of the above events occur, the development of properties may hinder our growth and have an adverse effect on our results of operations, including additional impairment charges.
In addition,Also, new development activities, regardless of whether or not they are ultimately successful, typically require substantial time and attention from management.
There is a lack of operating history with respect to any recent acquisitions and development of properties, and we may not succeed in the integration or management of additional properties.
These properties may have characteristics or deficiencies currently unknown to us that affect their value or revenue potential. It is also possible that the operating performance of these properties may decline under our management. As we acquire additional properties, we will be subject to risks associated with managing new properties, including lease-up and tenant retention. In addition, our ability to manage our growth effectively will require us to successfully integrate any new acquisitions into our existing management structure. We may not succeed with this integration or effectively manage additional properties. Also, newly acquired properties may not perform as expected.
Real estate property investments are illiquid, and therefore, we may not be able to dispose of properties when
appropriatedesirable or on favorable terms.
Real estate property investments generally cannot be disposed of quickly. In addition, the
federal tax codeInternal Revenue Code imposes restrictions on the ability of a REIT to dispose of properties that are not applicable to other types of real estate companies.
Our ability to dispose of properties on advantageous terms depends on factors beyond our control, including competition from other sellers and the availability of attractive financing for potential buyers of our properties, and we cannot predict the various market conditions affecting real estate investments that will exist at any particular time in the future. Therefore, we may not be able to quickly vary our portfolio in response to economic or other conditions promptly or on favorable terms, which could cause us to incur extended losses and reduce our cash flows and adversely affect distributions to shareholders.
As part of our capital recycling program, we intend to sell our non-core assets and may not be able to recover our investments, which may result in losses to us.
There can be no assurance that we will be able to recover the current carrying amount of all of our owned and partially owned non-core properties and investments in the future. Our failure to do so would require us to recognize impairment charges in the period in which we reached that conclusion, which could adversely affect our business, financial condition, operating results and cash flows.
Our cash flows and operating results could be adversely affected by required payments of debt or related interest and other risks of our debt financing.
We are generally subject to risks associated with debt financing. These risks include:
| ¡ | | Our cash flow may not satisfy required payments of principal and interest;
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| ¡ | | We may not be able to refinance existing indebtedness on our properties as necessary or the terms of the refinancing may be less favorable to us than the terms of existing debt;
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| ¡ | | Required debt payments are not reduced if the economic performance of any property declines;
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| ¡ | | Debt service obligations could reduce funds available for distribution to our shareholders and funds available for capital investment;
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| ¡ | | Any default on our indebtedness could result in acceleration of those obligations and possible loss of property to foreclosure; and
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| ¡ | | The risk that necessary capital expenditures for purposes such as re-leasing space cannot be financed on favorable terms.
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Our cash flow may not satisfy required payments of principal and interest;
We may not be able to refinance existing indebtedness on our properties as necessary or the terms of the refinancing may be less favorable to us than the terms of existing debt;
Required debt payments are not reduced if the economic performance of any property declines;
Debt service obligations could reduce funds available for distribution to our shareholders and funds available for capital investment;
Any default on our indebtedness could result in acceleration of those obligations and possible loss of property to foreclosure; and
The risk that necessary capital expenditures for purposes such as re-leasing space cannot be financed on favorable terms.
If a property is mortgaged to secure payment of indebtedness and we cannot make the mortgage payments, we may have to surrender the property to the lender with a consequent loss of any prospective income and equity value from such property. Any of these risks can place strains on our cash flows, reduce our ability to grow and adversely affect our results of operations.
Property ownership through
Credit ratings may not reflect all the risks of an investment in our debt or preferred shares and rating changes could adversely effect our revolving credit facility.
Our credit ratings are an assessment by rating agencies of our ability to pay our debts and preferred dividends when due. Consequently, real
estate partnershipsor anticipated changes in our credit ratings will generally affect the market value of our debt and
joint ventures could limit our control of those investments and reduce our expected return.Real estate partnershippreferred shares. Credit ratings may be revised or joint venture investments may involve risks not otherwise present for investments made solely by us, including the possibility that our partner or co-venturer might become bankrupt, that our partner or co-venturer mightwithdrawn at any time have different interestsby the rating agency at its sole discretion. Additionally, our revolving credit facility fees are based on our credit ratings. We do not undertake any obligation to maintain the ratings or goals than us, and thatto advise holders of our partnerdebt or co-venturer may take action contrary to our instructions, requests, policies or objectives. Other riskspreferred shares of joint venture investments could include impasse on decisions, such as a sale, because neither our partner or co-venturer nor we would have full control over the partnership or joint venture. These factors could limit the returnany change in ratings. Each agency's rating should be evaluated independently of any other agency's rating.
There can be no assurance that we receive from those investments or causewill be able to maintain our current credit ratings. Adverse changes in our credit ratings could impair our ability to obtain additional debt and equity financing on favorable terms, if at all, and could significantly reduce the market price of our publicly-traded securities.
Rising interest rates could adversely affect our cash flows
to be lower than our estimates.Volatility inand adversely affect the market and economic conditions may impact our partners’ ability to perform in accordance with our real estate joint venture and partnership agreements resulting in a change in control or the liquidation plans of its underlying properties.
Changes in controlprice of our investments could result as reconsiderations events are evaluated, such as amendments todebt and preferred shares.
We have indebtedness with interest rates that vary depending on market indices. Also, our
real estate joint venture and partnership agreements, changes incredit facilities bear interest at variable rates. We may incur variable-rate debt
guarantees or changes in ownership due to required capital contributions. Any changes in control will result in the
revaluationfuture. Increases in interest rates on variable-rate debt would increase our interest expense, which would negatively affect net income and cash available for payment of our
investmentsdebt obligations and distributions to
fairshareholders. In addition, an increase in interest rates could adversely affect the market value
which could lead to an impairment. We are unable to predict whether,of our outstanding debt and preferred shares, as well as increase the cost of refinancing and the issuance of new debt or
to what extent, a change in control may result or the impact of adverse market and economic conditions may have to our partners.securities.
Our financial condition could be adversely affected by financial covenants.
Our credit facilities and public debt indentures under which our indebtedness is, or may be, issued contain certain financial and operating covenants, including, among other things, certain coverage ratios, as well as limitations on our ability to incur secured and unsecured indebtedness, restrictions on our ability to sell all or substantially all of our assets and engage in mergers and consolidations and certain acquisitions. These covenants could limit our ability to obtain additional funds needed to address cash shortfalls or pursue growth opportunities or transactions that would provide substantial return to our shareholders. In addition, a breach of these covenants could cause a default under or accelerate some or all of our indebtedness, which could have a material adverse effect on our financial condition.
Property ownership through real estate partnerships and joint ventures could limit our control of those investments and reduce our expected return.
Real estate partnership or joint venture investments may involve risks not otherwise present for investments made solely by us, including the possibility that our partner or co-venturer might become bankrupt, that our partner or co-venturer might at any time have different interests or goals than us, and that our partner or co-venturer may take action contrary to our instructions, requests, policies or objectives. Other risks of joint venture investments could include impasse on decisions, such as a sale or refinance, because neither our partner or co-venturer nor we would have full control over the partnership or joint venture. These factors could limit the return that we receive from those investments or cause our cash flows to be lower than our estimates.
Volatility in market and economic conditions may impact our partners’ ability to perform in accordance with our real estate joint venture and partnership agreements resulting in a change in control or the liquidation plans of its underlying properties.
Changes in control of our investments could result if any reconsideration events occur, such as amendments to our real estate joint venture and partnership agreements, changes in debt guarantees or changes in ownership due to required capital contributions. Any changes in control will result in the revaluation of our investments to fair value, which could lead to an impairment. We are unable to predict whether, or to what extent, a change in control may result or the impact of adverse market and economic conditions may have to our partners.
If we fail to qualify as a REIT in any taxable year, we will be subject to U.S. federal income tax as a regular corporation and could have significant tax liability.
We intend to operate in a manner that allows us to qualify as a REIT for U.S. federal income tax purposes. However, REIT qualification requires us to satisfy numerous requirements (some on an annual or quarterly basis) established under highly technical and complex provisions of the Internal Revenue Code, for which there are a limited number of judicial or administrative interpretations. Our status as a REIT requires an analysis of various factual matters and circumstances that are not entirely within our control. Accordingly, it is not certain we will be able to qualify and remain qualified as a REIT for U.S. federal income tax purposes. Even a technical or inadvertent violation of the REIT requirements could jeopardize our REIT qualification. Furthermore, Congress or the Internal Revenue Service (“IRS”) might change the tax laws or regulations and the courts might issue new rulings, in each case potentially having retroactive effect that could make it more difficult or impossible for us to qualify as a REIT. If we fail to qualify as a REIT in any tax year, then:
| ¡ | | We would be taxed as a regular domestic corporation, which, among other things, means that we would be unable to deduct distributions to our shareholders in computing our taxable income and would be subject to U.S. federal income tax on our taxable income at regular corporate rates;
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| ¡ | | Any resulting tax liability could be substantial and would reduce the amount of cash available for distribution to shareholders, and could force us to liquidate assets or take other actions that could have a detrimental effect on our operating results; and
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| ¡ | | Unless we were entitled to relief under applicable statutory provisions, we would be disqualified from treatment as a REIT for the four taxable years following the year during which we lost our qualification, and our cash available for distribution to our shareholders would, therefore, be reduced for each of the years in which we do not qualify as a REIT.
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We would be taxed as a regular domestic corporation, which, among other things, means that we would be unable to deduct distributions to our shareholders in computing our taxable income and would be subject to U.S. federal income tax on our taxable income at regular corporate rates;
Any resulting tax liability could be substantial and would reduce the amount of cash available for distribution to shareholders, and could force us to liquidate assets or take other actions that could have a detrimental effect on our operating results; and
Unless we were entitled to relief under applicable statutory provisions, we would be disqualified from treatment as a REIT for the four taxable years following the year during which we lost our qualification, and our cash available for distribution to our shareholders would, therefore, be reduced for each of the years in which we do not qualify as a REIT.
Even if we remain qualified as a REIT, we may face other tax liabilities that reduce our cash flow. We may also be subject to certain U.S. federal, state and local taxes on our income and property either directly or at the level of our subsidiaries. Any of these taxes would decrease cash available for distribution to our shareholders.
Compliance with REIT requirements may negatively affect our operating decisions.
To maintain our status as a REIT for U.S. federal income tax purposes, we must meet certain requirements, on an ongoing basis, including requirements regarding our sources of income, the nature and diversification of our assets, the amounts we distribute to our shareholders and the ownership of our common shares. We may also be required to make distributions to our shareholders when we do not have funds readily available for distribution or at times when our funds are otherwise needed to fund capital
expenditures.expenditures or debt service obligations.
As a REIT, we must distribute at least 90% of our annual net taxable income (excluding net capital gains) to our shareholders. To the extent that we satisfy this distribution requirement, but distribute less than 100% of our net taxable income, we will be subject to U.S. federal corporate income tax on our undistributed taxable income. From time to time, we may generate taxable income greater than our income for financial reporting purposes, or our net taxable income may be greater than our cash flow available for distribution to our shareholders. If we do not have other funds available in these situations, we could be required to borrow funds, sell a portion of our securities at unfavorable prices or find other sources of funds in order to meet the REIT distribution requirements.
Dividends paid by REITs generally do not qualify for reduced tax rates.
In general, the maximum U.S. federal income tax rate for
qualified dividends paid to individual U.S. shareholders is
15% (through 2012)20%. Unlike dividends received from a corporation that is not a REIT, our distributions to individual shareholders generally are not eligible for the reduced
rates.The future compositionrates and quarterly cash distribution rate may change.
For each of the four quarters during 2011 and 2010, we paid a cash distributionare, consequently, taxed at a quarterly rate of $.275 and $.26 per common share, respectively. During the first quarter of 2009, we paid a cash distribution at a quarterly rate of $.525 per common share. Commencing with our second quarter 2009 dividend payout, we paid a cash distribution at a quarterly rate of $.25 per common share.
While we currently expect to pay future distributions in cash, we may pay up to 90% of our distributions inordinary income rates.
Our common shares
as permitted by an IRS revenue procedure that allows us to satisfydividend policy may change in the
REIT income distribution requirement by distributing up to 90% of our distributions in common shares in lieu of paying distributions entirely in cash. In the event that we pay a portion of a distribution in common shares, which we reserve the right to do, recipients would be required to pay tax on the entire amount of the distribution, including the portion paid in common shares, in which case the recipients might have to pay the tax using cash from other sources. Furthermore, with respect to non-U.S. holders, we may be required to withhold U.S. tax with respect to all or a portion of such distribution that is payable in common shares.future.
The timing, amount and composition of any future
distributionsdividends to our common shareholders will be at the sole discretion of our Board of Trust Managers and will depend upon a variety of factors as to which no assurance can be given. Our ability to make
distributionsdividends to our common shareholders depends, in part, upon our operating results, overall financial condition, the performance of our portfolio (including occupancy levels and rental rates), our capital requirements, access to capital, our ability to qualify for taxation as a REIT and general business and market conditions.
Any change in our dividend policy could have an adverse effect on the market price of our common shares.
Our declaration of trust contains certain limitations associated with share ownership.
To maintain our status as a REIT, our declaration of trust prohibits any individual from owning more than 9.8% of our outstanding common shares. This restriction is likely to discourage third parties from acquiring control without the consent of our Board of Trust Managers, even if a change in control were in the best interests of our shareholders.
Also, our declaration of trust requires the approval of the holders of 80% of our outstanding common shares and the approval by not less than 50% of the outstanding common shares not owned by any related person (a person owning more than 50% of our common shares) to consummate a business transaction such as a merger. There are certain exceptions to this requirement; however, the 80% approval requirement could make it difficult for us to consummate a business transaction even if it is in the best interest of our shareholders.
There may be future dilution of our common shares.
Our declaration of trust authorizes our Board of Trust Managers to, among other things, issue additional common or preferred shares or securities convertible or exchangeable into equity securities, without shareholder approval. We may issue such additional equity or convertible securities to raise additional capital. The issuance of any additional common or preferred shares or convertible securities could be substantially dilutive to holders of our common shares. Moreover, to the extent that we issue restricted shares, options, or warrants to purchase our common shares in the future and those options or warrants are exercised or the restricted shares vest, our shareholders may experience further dilution. Holders of our common shares have no preemptive rights that entitle them to purchase a pro rata share of any offering of shares of any class or series and, therefore, such sales or offerings could result in increased dilution to our shareholders.
We may issue debt and equity securities or securities convertible into equity securities, any of which may be senior to our common shares as to distributions and in liquidation, which could negatively affect the value of our common shares.
In the future, we may attempt to increase our capital resources by entering into unsecured or secured debt or debt-like financings, or by issuing additional debt or equity securities, which could include issuances of medium-term notes, senior notes, subordinated notes, secured debt, guarantees, preferred shares, hybrid securities, or securities convertible into or exchangeable for equity securities. In the event of our liquidation, our lenders and holders of our debt and preferred securities would receive distributions of our available assets before distributions to the holders of our common shares. Because any decision to incur debt and issue securities in future offerings may be influenced by market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing, or nature of our future financings. Further, market conditions could require us to accept less favorable terms for the issuance of our securities in the future.
Loss of our key personnel could adversely affect the value of our common shares and operations.
We are dependent on the efforts of our key executive personnel. Although we believe qualified replacements could be found for these key executives, the loss of their services could adversely affect the value of our common shares and operations.
Changes in accounting standards may adversely impact our reported financial condition and results of operations.
The Financial Accounting Standards Board (“FASB”), in conjunction with the SEC, has several key projects on their agenda that could impact how we currently account for our material transactions, including lease accounting and other convergence projects with the International Accounting Standards Board. We believe that these and other potential proposals could have varying degrees of impact on us ranging from minimal to material. At this time, we are unable to predict with certainty which, if any, proposals may be passed or what level of impact any such proposal could have on us.
We could be subject to litigation that may negatively impact our cash flows, financial condition and results of operations.
From time to time, we may be a defendant in lawsuits and regulatory proceedings relating to our business. Due to the inherent uncertainties of litigation and regulatory proceedings, we cannot accurately predict the ultimate outcome of any such litigation or proceedings. We could experience a negative impact to our cash flows, financial condition and results of operations due to an unfavorable outcome.
Compliance with certain laws and governmental rules and regulations may require us to make unintended expenditures that adversely affect our cash flows.
All of our properties are required to comply with certain laws and governmental rules and regulations, including the Americans with Disabilities Act, fire and safety regulations, building codes and other land use regulations, as they may be in effect or adopted by governmental agencies and bodies and become applicable to our properties. We may be required to make substantial capital expenditures to comply with those requirements, and these expenditures could have a material adverse effect on our ability to meet the financial obligations and make distributions to our shareholders.
An uninsured loss or a loss that exceeds the policies on our properties could subject us to lost capital or revenue on those properties.
Under the terms and conditions of the leases currently in force on our properties, tenants generally are required to indemnify and hold us harmless from liabilities resulting from injury to persons, air, water, land or property, on or off the premises, due to activities conducted on the properties, except for claims arising from our negligence or intentional misconduct or that of our agents. Tenants are generally required, at the tenant’s expense, to obtain and keep in full force during the term of the lease, liability and
tenant's property damage insurance policies. We have obtained comprehensive liability, casualty, property, flood and rental loss insurance policies on our properties. All of these policies may involve substantial deductibles and certain exclusions. In addition, we cannot assure the shareholders that the tenants will properly maintain their insurance policies or have the ability to pay the deductibles. Should a loss occur that is uninsured or in an amount exceeding the combined aggregate limits for the policies noted above, or in the event of a loss that is subject to a substantial deductible under an insurance policy, we could lose all or part of our capital invested in, and anticipated revenue from, one or more of the properties, which could have a material adverse effect on our operating results and financial condition, as well as our ability to make distributions to the shareholders.
Loss of our key personnel could adversely affect the value of our common shares and operations.
We are dependent on the efforts of our key executive personnel. Although we believe qualified replacements could be found for these key executives, the loss of their services could adversely affect the value of our common shares and operations.
Our declaration of trust contains certain limitations associated with share ownership.
In order to maintain our status as a REIT, our declaration of trust prohibits any individual from owning more than 9.8% of our outstanding common shares. This restriction is likely to discourage third parties from acquiring control without the consent of our Board of Trust Managers, even if a change in control were in the best interests of our shareholders.
Also, our declaration of trust requires the approval of the holders of 80% of our outstanding common shares and the approval by not less than 50% of the outstanding common shares not owned by any related person (a person owning more than 50% of our common shares) in order to consummate a business transaction such as a merger. There are certain exceptions to this requirement; however, the 80% approval requirement could make it difficult for us to consummate a business transaction even if it is in the best interest of our shareholders.
Compliance with the Americans with Disabilities Act and fire, safety and other regulations may require us to make unintended expenditures that adversely affect our cash flows.
All of our properties are required to comply with the Americans with Disabilities Act (“ADA”). The ADA has separate compliance requirements for “public accommodations” and “commercial facilities,” but generally requires that buildings be made accessible to people with disabilities. Compliance with the ADA requirements could require removal of access barriers, and noncompliance could result in imposition of fines by the U.S. government or an award of damages to private litigants, or both. While the tenants to whom we lease properties are obligated by law to comply with the ADA provisions, and typically under tenant leases are obligated to cover costs associated with compliance, if required changes involve greater expenditures than anticipated, or if the changes must be made on a more accelerated basis than anticipated, the ability of these tenants to cover costs could be adversely affected. As a result, we could be required to expend funds to comply with the provisions of the ADA, which could adversely affect the results of operations and financial condition and our ability to make distributions to shareholders. In addition, we are required to operate the properties in compliance with fire and safety regulations, building codes and other land use regulations, as they may be adopted by governmental agencies and bodies and become applicable to the properties.
We may be
requiredsubject to
make substantial capital expenditures to comply with those requirements, and these expenditures could have a material adverse effect on our ability to meet the financial obligations and make distributions to our shareholders.Changes in accounting standards may adversely impact our financial condition and results of operations.
The Financial Accounting Standards Board (“FASB”), in conjunction with the SEC, has several key projects on their agenda that could impact how we currently account for our material transactions, including lease accounting and other convergence projects with the International Accounting Standards Board. We believe that these and other potential proposals could have varying degrees of impact on us ranging from minimal to material. At this time, we are unable to predict with certainty which, if any, proposals may be passed or what level of impact any such proposal could have on us.
Our real estate investments may contain environmental risks that could adversely affect our operating results.
The acquisition of certain assets may subject us to environmental liabilities. Our operating expenses could be higher than anticipated due to the cost of complying with existing or futureliability under environmental laws, ordinances and regulations. In addition, under
Under various federal, state and local laws, ordinances and regulations, we may be considered an owner or operator of real property or have arranged for the disposal or treatment of hazardous or toxic substances. As a result, we may become liable for the costs of
removaldisposal or
remediationtreatment of
certain hazardous
or toxic substances released on or in our property.
We may also be liable for certain other potential costs that could relate to hazardous or toxic substances (including governmental fines and injuries to persons and property). We may incur such liability whether or not we knew of, or were responsible for, the presence of such hazardous or toxic substances. Any liability could be of substantial magnitude and divert management’s attention from other aspects of our business and, as a result, could have a material adverse effect on our operating results and financial condition, as well as our ability to make distributions to the shareholders.
Compliance with federal and state laws and regulations on climate control may reduce the value or profitability of our properties or adversely affect our cash flow.
All of our properties are required to comply with state and federal legislation and regulation that has been made or will be made regarding climate control. These matters may cause us or our tenants to incur substantial compliance, remediation and other costs, and can prohibit or severely restrict development in environmentally sensitive regions or areas. If not addressed, climate control issues or environmental conditions could impair our ability to sell or re-lease the affected properties in the future or result in lower sales prices or rent payments.
Currently, we are subject to certain regulations regarding the future replacement of roofing on our properties located in California, the City of Houston and Burbank, Illinois, which will increase the cost of replacement roofs for those properties. Compliance with these regulations is not expected to have a material effect on our operating results.
Natural disasters and severe weather conditions could have an adverse effect on our cash flow and operating results.
Changing weather patterns and climatic conditions, such as global warming, may have added to the unpredictability and frequency of natural disasters in some parts of the world and created additional uncertainty as to future trends and exposures. Our operations are located in many areas that are subject to natural disasters and severe weather conditions such as hurricanes, tornadoes, earthquakes, droughts, floods and fires. The occurrence of natural disasters or severe weather conditions can delay new development projects, increase investment costs to repair or replace damaged properties, increase future property insurance costs, and negatively impact the tenant demand for lease space. If insurance is unavailable to us or is unavailable on acceptable terms, or if our insurance is not adequate to cover business interruption or losses from these events, our earnings, liquidity or capital resources could be adversely affected.
Our business and operations would suffer in the event of system failures.
Despite the implementation of security measures and the existence of a disaster recovery plan for our internal information technology systems, our systems are vulnerable to damages from any number of sources, including computer viruses, unauthorized access, energy blackouts, natural disasters, terrorism, war and telecommunication failures. Any system failure or accident that causes interruptions in our operations could result in a material disruption to our business. We
are unablemay also incur additional costs to
predict the effect of current governmental proposals.The current U.S. administration and Congress have made, or called for consideration of, several additional proposalsremedy damages caused by such disruptions.
We face risks relating to a varietycybersecurity attacks, loss of issues, including healthcare, financial regulation reform, climate control and others. We believe that theseconfidential information and other potential proposals could have varying degrees of impact on us rangingbusiness disruptions.
Our business is at risk from
minimal to material. At this time, we are unable to predict with certainty which, if any, proposalsand may be
passed or what levelimpacted by cybersecurity attacks, including attempts to gain unauthorized access to our confidential data and other electronic security breaches. Such cybersecurity attacks can range from individual attempts to gain unauthorized access to our information technology systems to more sophisticated security threats. While we employ a number of
impact anymeasures to prevent, detect and mitigate these threats including a defense in depth strategy of malware detection, password protection, backup servers and periodic penetration testing, there is no guarantee such
proposalefforts will be successful in preventing a cybersecurity attack. As our reliance on technology has increased, so have the risks posed to our systems, both internal and those we have outsourced. Cybersecurity incidents could
have on us.| compromise the confidential information of our tenants, employees and third-party vendors and disrupt and affect the efficiency of our business operations. ITEM 1B. Unresolved Staff Comments None.
ITEM 2. Properties | Unresolved Staff Comments |
None.
At December 31, 2011, our real estate properties consisted of 391 locations in 23 states. A complete listing of these properties, including the name, location, building area and land area, is as follows (in square feet):
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Center and Location | | | | | | | Building Total | | | Land
Total | |
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Retail | | | | | | | | | | | | | | |
| | | | |
Arizona | | | | | | | | | | | | | | |
Arrowhead Festival S.C., 75th Ave. at W. Bell Rd., Glendale | | | | | | | | | 194,309 | | | | 157,000 | |
Basha's Valley Plaza, S. McClintock at E. Southern, Tempe | | | | | | | | | 153,880 | | | | 570,000 | |
Broadway Marketplace, Broadway at Rural, Tempe | | | | | | | | | 87,379 | | | | 347,000 | |
Camelback Village Square, Camelback at 7th Avenue, Phoenix | | | | | | | | | 242,715 | | | | 543,000 | |
Desert Village, Pinnacle Peak Rd. at Pima Rd., Scottsdale | | | | | | | | | 107,214 | | | | 595,901 | |
Entrada de Oro, Magee Road and Oracle Road, Tucson | | | | | | | | | 109,075 | | | | 572,000 | |
Fountain Plaza, 77th St. at McDowell, Scottsdale | | | | | | | | | 294,813 | | | | 445,000 | |
Fry's Ellsworth Plaza, Broadway Rd. at Ellsworth Rd., Mesa | | | | | | | | | 73,608 | | | | 58,000 | |
Laveen Village Market, Baseline Rd. at 51st St., Phoenix | | | | | | | | | 319,067 | | | | 372,274 | |
Madera Village, Tanque Verde Rd. and Catalina Hwy., Tucson | | | | | | | | | 106,893 | | | | 419,000 | |
Mohave Crossroads, Bullhead Parkway at State Route 95, Bullhead City | | | | | | | | | 396,702 | | | | 990,867 | |
Monte Vista Village Center, Baseline Rd. at Ellsworth Rd., Mesa | | | | | | | | | 108,551 | | | | 353,000 | |
Oracle Crossings, Oracle Highway and Magee Road, Tucson | | | | | | | | | 263,163 | | | | 1,307,000 | |
Oracle Wetmore, Wetmore Road and Oracle Highway, Tucson | | | | | | | | | 343,089 | | | | 711,162 | |
Palmilla Center, Dysart Rd. at McDowell Rd., Avondale | | | | | | | | | 178,219 | | | | 264,000 | |
Pueblo Anozira, McClintock Dr. at Guadalupe Rd., Tempe | | | | | | | | | 157,221 | | | | 769,000 | |
Raintree Ranch, Ray Rd. at Price Rd., Chandler | | | | | | | | | 133,020 | | | | 714,813 | |
Rancho Encanto, 35th Avenue at Greenway Rd., Phoenix | | | | | | | | | 72,170 | | | | 246,440 | |
Red Mountain Gateway, Power Rd. at McKellips Rd., Mesa | | | | | | | | | 199,012 | | | | 353,000 | |
Scottsdale Horizon, Frank Lloyd Wright Blvd. and Thompson Peak Parkway, Scottsdale | | | | | | | | | 148,383 | | | | 61,000 | |
Shoppes at Bears Path, Tanque Verde Rd. and Bear Canyon Rd., Tucson | | | | | | | | | 66,131 | | | | 362,000 | |
Squaw Peak Plaza, 16th Street at Glendale Ave., Phoenix | | | | | | | | | 60,728 | | | | 220,000 | |
The Shoppes at Parkwood Ranch, Southern Avenue and Signal Butte Road, Mesa | | | | | | | | | 106,738 | | | | 569,966 | |
Arizona, Total | | | | | | | | | 3,922,080 | | | | 11,001,423 | |
| | | | |
Arkansas | | | | | | | | | | | | | | |
Markham Square, W. Markham at John Barrow, Little Rock | | | | | | | | | 125,884 | | | | 514,000 | |
Markham West, 11400 W. Markham, Little Rock | | | | | | | | | 178,500 | | | | 769,000 | |
Westgate, Cantrell at Bryant, Little Rock | | | | | | | | | 52,626 | | | | 206,000 | |
Arkansas, Total | | | | | | | | | 357,010 | | | | 1,489,000 | |
| | | | |
California | | | | | | | | | | | | | | |
580 Market Place, E. Castro Valley at Hwy. I-580, Castro Valley | | | | | | | | | 100,165 | | | | 444,000 | |
Arcade Square, Watt Ave. at Whitney Ave., Sacramento | | | | | | | | | 76,497 | | | | 234,000 | |
Buena Vista Marketplace, Huntington Dr. at Buena Vista St., Duarte | | | | | | | | | 115,340 | | | | 322,000 | |
Centerwood Plaza, Lakewood Blvd. at Alondra Dr., Bellflower | | | | | | | | | 75,486 | | | | 333,000 | |
Chino Hills Marketplace, Chino Hills Pkwy. at Pipeline Ave., Chino Hills | | | | | | | | | 311,034 | | | | 1,187,000 | |
Creekside Center, Alamo Dr. at Nut Creek Rd., Vacaville | | | | | | | | | 114,445 | | | | 400,000 | |
Discovery Plaza, W. El Camino Ave. at Truxel Rd., Sacramento | | | | | | | | | 93,398 | | | | 417,000 | |
El Camino Promenade, El Camino Real at Via Molena, Encinitas | | | | | | | | | 129,651 | | | | 451,000 | |
Freedom Centre, Freedom Blvd. at Airport Blvd., Watsonville | | | | | | | | | 150,241 | | | | 543,000 | |
Fremont Gateway Plaza, Paseo Padre Pkwy. at Walnut Ave., Fremont | | | | | | | | | 361,701 | | | | 650,000 | |
Greenhouse Marketplace, Lewelling Blvd. at Washington Ave., San Leandro | | | | | | | | | 236,832 | | | | 578,000 | |
Hallmark Town Center, W. Cleveland Ave. at Stephanie Ln., Madera | | | | | | | | | 98,359 | | | | 365,000 | |
Jess Ranch Marketplace, Bear Valley Rd. at Jess Ranch Pkwy., Apple Valley | | | (1)(3) | | | | | | 307,937 | | | | 920,423 | |
Jess Ranch Phase III, Bear Valley Road at Jess Ranch Parkway, Apple Valley | | | (1)(3) | | | | | | 185,121 | | | | 741,813 | |
| | | | | | | | | | | | |
Center and Location | | | | | | Building Total | | | Land
Total | |
| | | | |
Marshalls Plaza, McHenry at Sylvan Ave., Modesto | | | | | | | 85,952 | | | | 218,000 | |
Menifee Town Center, Antelope Rd. at Newport Rd., Menifee | | | | | | | 248,734 | | | | 658,000 | |
Prospectors Plaza, Missouri Flat Rd. at US Hwy. 50, Placerville | | | | | | | 236,959 | | | | 866,684 | |
Rancho San Marcos Village, San Marcos Blvd. at Rancho Santa Fe Rd., San Marcos | | | | | | | 132,689 | | | | 541,000 | |
San Marcos Plaza, San Marcos Blvd. at Rancho Santa Fe Rd., San Marcos | | | | | | | 81,086 | | | | 116,000 | |
Shasta Crossroads, Churn Creek Rd. at Dana Dr., Redding | | | | | | | 252,651 | | | | 520,000 | |
Silver Creek Plaza, E. Capital Expressway at Silver Creek Blvd., San Jose | | | | | | | 197,925 | | | | 573,000 | |
Southampton Center, IH-780 at Southampton Rd., Benecia | | | | | | | 162,764 | | | | 596,000 | |
Stoneridge Town Centre, Highway 60 at Nason St., Moreno Valley | | (1)(3) | | | | | 431,272 | | | | 1,104,246 | |
Stony Point Plaza, Stony Point Rd. at Hwy. 12, Santa Rosa | | | | | | | 200,634 | | | | 619,000 | |
Summerhill Plaza, Antelope Rd. at Lichen Dr., Sacramento | | | | | | | 128,880 | | | | 704,000 | |
Sunset Center, Sunset Ave. at State Hwy. 12, Suisun City | | | | | | | 98,279 | | | | 359,000 | |
Tully Corners Shopping Center, Tully Rd at Quimby Rd, San Jose | | (1)(3) | | | | | 115,992 | | | | 430,891 | |
Valley, Franklin Blvd. and Mack Rd., Sacramento | | | | | | | 107,005 | | | | 580,000 | |
Westminster Center, Westminster Blvd. at Golden West St., Westminster | | | | | | | 425,690 | | | | 1,739,000 | |
California, Total | | | | | | | 5,262,719 | | | | 17,211,057 | |
| | | | |
Colorado | | | | | | | | | | | | |
Academy Place, Academy Blvd. at Union Blvd., Colorado Springs | | | | | | | 290,464 | | | | 404,000 | |
Aurora City Place, E. Alameda at I225, Aurora | | (1)(3) | | | | | 542,957 | | | | 2,260,000 | |
Cherry Creek, E. Alameda Ave. at S. Colorado Blvd. Glendale | | | | | | | 272,671 | | | | 330,795 | |
CityCenter Englewood, S. Santa Fe at Hampden Ave., Englewood | | (1)(3) | | | | | 359,305 | | | | 452,941 | |
Crossing at Stonegate, Jordon Rd. at Lincoln Ave., Parker | | (1)(3) | | | | | 109,058 | | | | 870,588 | |
Edgewater Marketplace, Sheridan Blvd. at 17th Ave., Edgewater | | | | | | | 271,780 | | | | 538,576 | |
Green Valley Ranch Towne Center, Tower Rd. at 48th Ave., Denver | | (1)(3) | | | | | 114,947 | | | | 276,000 | |
Lowry Town Center, 2nd Ave. at Lowry Ave., Denver | | (1)(3) | | | | | 129,398 | | | | 246,000 | |
River Point at Sheridan, Highway 85 and Highway 285, Sheridan | | (1)(2) | | | | | 446,236 | | | | 3,266,813 | |
The Gardens on Havana, Mississippi at Havana, Aurora | | (1)(3) | | | | | 946,607 | | | | 0 | |
Thorncreek Crossing, Washington St. at 120th St., Thornton | | (1)(3) | | | | | 386,137 | | | | 1,156,863 | |
Uintah Gardens, NEC 19th St. at West Uintah, Colorado Springs | | | | | | | 214,774 | | | | 677,000 | |
Westminster Plaza, North Federal Blvd. at 72nd Ave., Westminster | | (1) | | | | | 111,113 | | | | 636,000 | |
Colorado, Total | | | | | | | 4,195,447 | | | | 11,115,576 | |
| | | | |
Florida | | | | | | | | | | | | |
Alafaya Square, Alafaya Trail, Oviedo | | (1)(3) | | | | | 176,486 | | | | 915,000 | |
Argyle Village, Blanding at Argyle Forest Blvd., Jacksonville | | | | | | | 315,497 | | | | 1,329,000 | |
Atlantic North, Kernan Blvd. at Atlantic Blvd., Jacksonville | | (1)(3) | | | | | 67,685 | | | | 326,061 | |
Atlantic West, Kernan Blvd. at Atlantic Blvd., Jacksonville | | (1)(3) | | | | | 163,481 | | | | 584,304 | |
Boca Lyons, Glades Rd. at Lyons Rd., Boca Raton | | | | | | | 117,515 | | | | 545,000 | |
Clermont Landing, U.S. 27 & Steve's Road, Clermont | | (1)(2)(3) | | | | | 2,183,994 | | | | 2,039,915 | |
Colonial Landing, East Colonial Dr. at Maguire Boulevard, Orlando | | (1) | | | | | 263,007 | | | | 980,000 | |
Colonial Plaza, E. Colonial Dr. at Primrose Dr., Orlando | | | | | | | 502,182 | | | | 2,009,000 | |
Countryside Centre, US Highway 19 at Countryside Boulevard, Clearwater | | | | | | | 247,163 | | | | 906,440 | |
East Lake Woodlands, East Lake Road and Tampa Road, Palm Harbor | | (1)(3) | | | | | 140,617 | | | | 730,000 | |
Embassy Lakes, Sheraton St. at Hiatus Rd., Cooper City | | | | | | | 179,937 | | | | 618,000 | |
Epic Village–St. Augustine, SR 207 at Rolling Hills Dr., St. Augustine | | (1) | | | | | 62,542 | | | | 773,626 | |
Flamingo Pines, Pines Blvd. at Flamingo Rd., Pembroke Pines | | | | | | | 266,761 | | | | 739,925 | |
Flamingo Pines, Pines Blvd. at Flamingo Rd., Pembroke Pines | | (1)(3) | | | | | 148,435 | | | | 707,075 | |
Hollywood Hills Plaza, Hollywood Blvd. at North Park Rd., Hollywood | | (1)(3) | | | | | 408,509 | | | | 1,429,000 | |
Indian Harbour Place, East Eau Gallie Blvd., Indian Harbour Beach | | (1)(3) | | | | | 163,521 | | | | 636,000 | |
International Drive Value Center, International Dr. and Touchstone Dr., Orlando | | (1)(3) | | | | | 185,664 | | | | 985,000 | |
Kendall Corners, Kendall Drive and SW 127th Avenue, Miami | | (1)(3) | | | | | 96,472 | | | | 365,000 | |
Kernan Village, Kernan Blvd. at Atlantic Blvd., Jacksonville | | (1)(3) | | | | | 288,925 | | | | 615,114 | |
Lake Washington Crossing, Wickham Rd. at Lake Washington Rd., Melbourne | | (1)(3) | | | | | 118,828 | | | | 580,000 | |
| | | | | | | | | | | | |
Center and Location | | | | | | Building Total | | | Land
Total | |
| | | | |
Lake Washington Square, Wickham Rd. at Lake Washington Rd., Melbourne | | | | | | | 111,811 | | | | 688,000 | |
Largo Mall, Ulmerton Rd. at Seminole Ave., Largo | | | | | | | 575,247 | | | | 1,888,000 | |
Market at Southside, Michigan Ave. at Delaney Ave., Orlando | | | | | | | 159,755 | | | | 349,000 | |
Marketplace at Seminole Towne Center, Central Florida Greenway and Rinehart Rd., Sanford | | | | | | | 491,962 | | | | 1,743,000 | |
Northridge, E. Commercial Blvd. at Dixie Hwy., Oakland Park | | (1)(3) | | | | | 239,097 | | | | 901,000 | |
Palm Lakes Plaza, Atlantic Boulevard and Rock Island Road, Maragate | | (1)(3) | | | | | 113,752 | | | | 550,000 | |
Palms of Carrollwood, N. Dale Maybry Dr. at Fletcher Ave., Tampa | | | | | | | 167,887 | | | | 679,536 | |
Paradise Key at Kelly Plantation, US Highway 98 and Mid Bay Bridge Rd, Destin | | (1)(3) | | | | | 271,777 | | | | 1,247,123 | |
Pembroke Commons, University at Pines Blvd., Pembroke Pines | | (1)(3) | | | | | 324,829 | | | | 1,394,000 | |
Phillips Crossing, Interstate 4 and Sand Lake Road, Orlando | | | | | | | 145,644 | | | | 697,000 | |
Phillips Landing, Turkey Lake Rd., Orlando | | | | | | | 286,038 | | | | 311,000 | |
Pineapple Commons, US Highway 1 and Britt Rd., Stuart | | (1)(3) | | | | | 268,468 | | | | 762,736 | |
Publix at Laguna Isles, Sheridan St. at SW 196th Ave., Pembroke Pines | | | | | | | 69,475 | | | | 400,000 | |
Quesada Commons, Quesada Ave. and Toledo Blade Blvd., Port Charlotte | | (1)(3) | | | | | 58,890 | | | | 312,000 | |
Shoppes at Paradise Isle, 34940 Emerald Coast Pkwy., Destin | | (1)(3) | | | | | 171,669 | | | | 764,000 | |
Shoppes at Parkland, Hillsboro Blvd. at State Rd. #7, Parkland | | (1) | | | | | 167,240 | | | | 905,000 | |
Shoppes of Port Charlotte, Toledo Blade Blvd. and Tamiami Trail, Port Charlotte | | (1)(3) | | | | | 3,921 | | | | 176,720 | |
Shoppes of Port Charlotte, Toledo Blade Blvd. and Tamiami Trail, Port Charlotte | | (1)(3) | | | | | 41,011 | | | | 276,000 | |
South Dade, South Dixie Highway and Eureka Drive, Miami | | (1)(3) | | | | | 219,473 | | | | 1,230,000 | |
Sunrise West Shopping Center, West Commercial Dr. and NW 91st Ave., Sunrise | | (1)(3) | | | | | 76,321 | | | | 540,000 | |
Sunset 19, US Hwy. 19 at Sunset Pointe Rd., Clearwater | | | | | | | 275,910 | | | | 1,078,000 | |
Tamiami Trail Shops, S.W. 8th St. at S.W. 137th Ave., Miami | | (1)(3) | | | | | 132,564 | | | | 515,000 | |
The Marketplace at Dr. Phillips, Dr. Phillips Boulevard and Sand Lake Road, Orlando | | (1)(3) | | | | | 326,108 | | | | 1,495,000 | |
The Shoppes at South Semoran, Semoran Blvd. at Pershing Ave., Orlando | | | | | | | 101,486 | | | | 451,282 | |
TJ Maxx Plaza, 117th Avenue at Sunset Blvd., Kendall | | | | | | | 161,429 | | | | 540,000 | |
University Palms, Alafaya Trail at McCullough Rd., Oviedo | | (1) | | | | | 105,127 | | | | 522,000 | |
Venice Pines, Center Rd. at Jacaranda Blvd., Venice | | | | | | | 97,303 | | | | 525,000 | |
Vizcaya Square, Nob Hill Rd. at Cleary Blvd., Plantation | | | | | | | 112,410 | | | | 521,000 | |
Westland Terrace Plaza, SR 50 at Apopka Vineland Rd., Orlando | | | | | | | 260,521 | | | | 361,000 | |
Whole Foods @ Carrollwood, Northdale Blvd. at North Dale Mabry | | (2) | | | | | 36,700 | | | | 275,735 | |
Winter Park Corners, Aloma Ave. at Lakemont Ave., Winter Park | | | | | | | 102,382 | | | | 400,000 | |
Florida, Total | | | | | | | 11,773,428 | | | | 40,311,592 | |
| | | | |
Georgia | | | | | | | | | | | | |
Brookwood Marketplace, Peachtree Pkwy. at Mathis Airport Rd., Suwannee | | | | | | | 397,295 | | | | 1,459,000 | |
Brookwood Square, East-West Connector at Austell Rd., Austell | | | | | | | 234,501 | | | | 971,000 | |
Brownsville Commons, Brownsville Rd. and Hiram-Lithia Springs Rd., Powder Springs | | | | | | | 81,886 | | | | 205,000 | |
Camp Creek Marketplace II, Camp Creek Pkwy. and Carmla Dr., Atlanta | | | | | | | 228,003 | | | | 724,000 | |
Cherokee Plaza, Peachtree Road and Colonial Drive, Atlanta | | (1) | | | | | 99,749 | | | | 336,000 | |
Dacula Marketplace, Fence Rd. at Dacula Rd., Dacula | | (2) | | | | | 99,403 | | | | 279,220 | |
Dallas Commons, US Hwy. 278 and Nathan Dean Blvd., Dallas | | | | | | | 95,262 | | | | 244,000 | |
Grayson Commons, Grayson Hwy. at Rosebud Rd., Grayson | | | | | | | 76,611 | | | | 507,383 | |
Lakeside Marketplace, Cobb Pkwy. (US Hwy. 41), Acworth | | | | | | | 332,044 | | | | 736,000 | |
Mansell Crossing, North Point Parkway at Mansell Rd, Alpharetta | | (1)(3) | | | | | 102,931 | | | | 582,833 | |
Perimeter Village, Ashford-Dunwoody Rd., Atlanta | | | | | | | 387,755 | | | | 1,803,820 | |
Publix at Princeton Lakes, Carmia Dr. and Camp Creek Dr., Atlanta | | (1)(3) | | | | | 72,207 | | | | 336,000 | |
Reynolds Crossing, Steve Reynolds and Old North Cross Rd., Duluth | | | | | | | 115,983 | | | | 407,000 | |
Roswell Corners, Woodstock Rd. at Hardscrabble Rd., Roswell | | | | | | | 318,369 | | | | 784,000 | |
Sandy Plains Exchange, Sandy Plains at Scufflegrit, Marietta | | (1) | | | | | 72,784 | | | | 452,000 | |
Thompson Bridge Commons, Thompson Bridge Rd. at Mt. Vernon Rd., Gainesville | | (1) | | | | | 95,587 | | | | 540,000 | |
Georgia, Total | | | | | | | 2,810,370 | | | | 10,367,256 | |
| | | | | | | | | | | | |
Center and Location | | | | | | Building Total | | | Land
Total | |
| | | | |
Illinois | | | | | | | | | | | | |
Burbank Station, S. Cicero Ave. at W. 78th St., Burbank | | | | | | | 303,566 | | | | 1,013,380 | |
Illinois, Total | | | | | | | 303,566 | | | | 1,013,380 | |
| | | | |
Kansas | | | | | | | | | | | | |
Kohl's, Wanamaker Rd. at S.W. 17th St., Topeka | | | | | | | 115,716 | | | | 444,000 | |
Kansas, Total | | | | | | | 115,716 | | | | 444,000 | |
| | | | |
Kentucky | | | | | | | | | | | | |
Festival at Jefferson Court, Outer Loop at Jefferson Blvd., Louisville | | | | | | | 218,396 | | | | 1,153,000 | |
Millpond Center, Boston at Man O’War, Lexington | | | | | | | 151,567 | | | | 773,000 | |
Regency Shopping Centre, Nicholasville Rd. & West Lowry Ln., Lexington | | | | | | | 189,016 | | | | 590,000 | |
Tates Creek, Tates Creek at Man O’War, Lexington | | | | | | | 179,450 | | | | 586,384 | |
Kentucky, Total | | | | | | | 738,429 | | | | 3,102,384 | |
| | | | |
Louisiana | | | | | | | | | | | | |
14/Park Plaza, Hwy. 14 at General Doolittle, Lake Charles | | | | | | | 172,068 | | | | 535,000 | |
Danville Plaza, Louisville at 19th, Monroe | | | | | | | 141,218 | | | | 539,000 | |
K-Mart Plaza, Ryan St., Lake Charles | | (1)(3) | | | | | 232,390 | | | | 126,000 | |
Manhattan Place, Manhattan Blvd. at Gretna Blvd., Harvey | | | | | | | 276,615 | | | | 718,339 | |
Orleans Station, Paris, Robert E. Lee at Chatham, New Orleans | | | | | | | 3,000 | | | | 15,318 | |
Prien Lake Plaza, Prien Lake Rd. at Nelson Rd., Lake Charles | | | | | | | 213,618 | | | | 64,950 | |
River Marketplace, Ambassador Caffery at Kaliste Saloom, Lafayette | | (1)(3) | | | | | 342,935 | | | | 1,029,415 | |
Southgate, Ryan at Eddy, Lake Charles | | | | | | | 158,587 | | | | 511,000 | |
Town & Country Plaza, U.S. Hwy. 190 West, Hammond | | | | | | | 224,827 | | | | 645,000 | |
University Place, 70th St. at Youree Dr., Shreveport | | (1)(3) | | | | | 376,154 | | | | 1,076,803 | |
University Place, 71st St. at Youree Dr., Shreveport | | | | | | | 5,100 | | | | 37,462 | |
Westwood Village, W. Congress at Bertrand, Lafayette | | | | | | | 138,034 | | | | 942,000 | |
Louisiana, Total | | | | | | | 2,284,546 | | | | 6,240,287 | |
| | | | |
Maine | | | | | | | | | | | | |
The Promenade, Essex at Summit, Lewiston | | (1) | | | | | 181,938 | | | | 962,667 | |
Maine, Total | | | | | | | 181,938 | | | | 962,667 | |
| | | | |
Missouri | | | | | | | | | | | | |
Ballwin Plaza, Manchester Rd. at Vlasis Dr., Ballwin | | | | | | | 200,915 | | | | 653,000 | |
Western Plaza, Hwy 141 at Hwy. 30, Fenton | | (1)(3) | | | | | 56,734 | | | | 654,000 | |
Missouri, Total | | | | | | | 257,649 | | | | 1,307,000 | |
| | | | |
Nevada | | | | | | | | | | | | |
Best in the West, Rainbow at Lake Mead Rd., Las Vegas | | | | | | | 428,067 | | | | 1,516,000 | |
Charleston Commons, Charleston and Nellis, Las Vegas | | | | | | | 362,514 | | | | 1,314,791 | |
College Park S.C., E. Lake Mead Blvd. at Civic Ctr. Dr., North Las Vegas | | | | | | | 195,367 | | | | 721,000 | |
Eastern Horizon, Eastern Ave. at Horizon Ridge Pkwy., Henderson | | | | | | | 209,727 | | | | 478,000 | |
Francisco Centre, E. Desert Inn Rd. at S. Eastern Ave., Las Vegas | | | | | | | 148,815 | | | | 639,000 | |
Mission Center, Flamingo Rd. at Maryland Pkwy, Las Vegas | | | | | | | 212,169 | | | | 570,000 | |
Paradise Marketplace, Flamingo Rd. at Sandhill, Las Vegas | | | | | | | 148,092 | | | | 323,556 | |
Rainbow Plaza, Phase I, Rainbow Blvd. at Charleston Blvd., Las Vegas | | | | | | | 136,369 | | | | 514,518 | |
Rainbow Plaza, Rainbow Blvd. at Charleston Blvd., Las Vegas | | | | | | | 273,916 | | | | 1,033,482 | |
Rancho Towne & Country, Rainbow Blvd. at Charleston Blvd., Las Vegas | | | | | | | 137,843 | | | | 350,000 | |
Tropicana Beltway, Tropicana Beltway at Fort Apache Rd., Las Vegas | | | | | | | 617,821 | | | | 1,466,000 | |
Tropicana Marketplace, Tropicana at Jones Blvd., Las Vegas | | | | | | | 142,643 | | | | 309,912 | |
Westland Fair North, Charleston Blvd. at Decatur Blvd., Las Vegas | | | | | | | 602,904 | | | | 1,008,451 | |
Nevada, Total | | | | | | | 3,616,247 | | | | 10,244,710 | |
| | | | |
New Mexico | | | | | | | | | | | | |
Eastdale, Candelaria Rd. at Eubank Blvd., Albuquerque | | | | | | | 119,091 | | | | 601,000 | |
North Towne Plaza, Academy Rd. at Wyoming Blvd., Albuquerque | | | | | | | 138,506 | | | | 607,000 | |
Pavillions at San Mateo, I-40 at San Mateo, Albuquerque | | | | | | | 208,691 | | | | 604,733 | |
| | | | | | | | | | | | |
Center and Location | | | | | | Building Total | | | Land
Total | |
| | | | |
Wyoming Mall, Academy Rd. at Northeastern, Albuquerque | | | | | | | 270,899 | | | | 271,407 | |
New Mexico, Total | | | | | | | 737,187 | | | | 2,084,140 | |
| | | | |
North Carolina | | | | | | | | | | | | |
Avent Ferry, Avent Ferry Rd. at Gorman St., Raleigh | | | | | | | 111,622 | | | | 669,000 | |
Bull City Market, Broad St. at West Main St., Durham | | | | | | | 40,875 | | | | 112,000 | |
Capital Square, Capital Blvd. at Huntleigh Dr., Cary | | | | | | | 143,063 | | | | 607,000 | |
Chatham Crossing, US 15/501 at Plaza Dr., Chapel Hill | | (1)(3) | | | | | 96,155 | | | | 424,000 | |
Cole Park Plaza, US 15/501 and Plaza Dr., Chapel Hill | | (1)(3) | | | | | 82,258 | | | | 380,000 | |
Falls Pointe, Neuce Rd. at Durant Rd., Raleigh | | | | | | | 193,331 | | | | 659,000 | |
Galleria, Galleria Boulevard and Sardis Road, Charlotte | | | | | | | 328,276 | | | | 799,000 | |
Harrison Pointe, Harrison Ave. at Maynard Rd., Cary | | | | | | | 130,934 | | | | 1,222,382 | |
Heritage Station, Forestville Rd. at Rogers Rd., Wake Forest | | (1) | | | | | 72,669 | | | | 392,000 | |
High House Crossing, NC Hwy. 55 at Green Level W. Rd., Cary | | | | | | | 90,155 | | | | 606,000 | |
Hope Valley Commons, Highway 751 and Highway 54, Durham | | | | | | | 81,471 | | | | 1,247,123 | |
Johnston Road Plaza, Johnston Rd. at McMullen Creek Pkwy., Charlotte | | | | | | | 79,508 | | | | 466,000 | |
Leesville Town Centre, Leesville Rd. at Leesville Church Rd., Raleigh | | | | | | | 114,396 | | | | 904,000 | |
Mineral Springs Village, Mineral Springs Rd. at Wake Forest Rd., Durham | | | | | | | 59,859 | | | | 572,000 | |
Northwoods Market, Maynard Rd. at Harrison Ave., Cary | | | | | | | 77,802 | | | | 431,000 | |
Parkway Pointe, Cory Parkway at S. R. 1011, Cary | | | | | | | 80,061 | | | | 461,000 | |
Pinecrest Plaza, Hwy. 15-501 at Morganton Rd., Pinehurst | | | | | | | 252,038 | | | | 1,438,000 | |
Ravenstone Commons, Hwy. 98 at Sherron Rd., Durham | | | | | | | 60,424 | | | | 374,000 | |
Six Forks Station, Six Forks Rd. at Strickland Rd., Raleigh | | | | | | | 466,585 | | | | 1,843,000 | |
Steele Creek Crossing, York Rd. at Steele Creek Rd., Charlotte | | | | | | | 77,301 | | | | 491,000 | |
Stonehenge Market, Creedmoor Rd. at Bridgeport Dr., Raleigh | | | | | | | 188,521 | | | | 669,000 | |
Surf City Crossing, Highway 17 and Highway 210, Surf City | | (2) | | | | | 56,199 | | | | 434,311 | |
Waterford Village, U.S. Hwy. 17 & U.S. Hwy. 74/76, Leland | | | | | | | 83,512 | | | | 1,426,594 | |
Whitehall Commons, NWC of Hwy. 49 at I-485, Charlotte | | | | | | | 444,561 | | | | 360,000 | |
North Carolina, Total | | | | | | | 3,411,576 | | | | 16,987,410 | |
| | | | |
Oklahoma | | | | | | | | | | | | |
Market Boulevard, E. Reno Ave. at N. Douglas Ave., Midwest City | | | | | | | 35,765 | | | | 142,000 | |
Town and Country, Reno Ave. at North Air Depot, Midwest City | | | | | | | 128,231 | | | | 540,000 | |
Oklahoma, Total | | | | | | | 163,996 | | | | 682,000 | |
| | | | |
Oregon | | | | | | | | | | | | |
Clackamas Square, SE 82nd Avenue and SE Causey Avenue, Portland | | (1)(3) | | | | | 136,739 | | | | 215,000 | |
Oak Grove Market Center, SE Mcloughlin Blvd. & Oak Grove Ave., Portland | | | | | | | 97,177 | | | | 292,288 | |
Raleigh Hills Plaza, SW Beaverton-Hillsdale Hwy. and SW Scholls Ferry Road, Portland | | (1)(3) | | | | | 39,520 | | | | 165,000 | |
Oregon, Total | | | | | | | 273,436 | | | | 672,288 | |
| | | | |
South Carolina | | | | | | | | | | | | |
Fresh Market Shoppes, 890 William Hilton Head Pkwy., Hilton Head | | (1)(3) | | | | | 86,120 | | | | 436,000 | |
South Carolina, Total | | | | | | | 86,120 | | | | 436,000 | |
| | | | |
Tennessee | | | | | | | | | | | | |
Bartlett Towne Center, Bartlett Blvd. at Stage Rd., Bartlett | | | | | | | 192,624 | | | | 774,000 | |
Commons at Dexter Lake Phase II, Dexter at N. Germantown, Memphis | | (1) | | | | | 66,838 | | | | 272,792 | |
Commons at Dexter Lake, Dexter at N. Germantown, Memphis | | (1) | | | | | 178,558 | | | | 740,208 | |
Highland Square, Summer at Highland, Memphis | | | | | | | 14,490 | | | | 84,000 | |
Mendenhall Commons, South Mendenahall Rd. and Sanderlin Ave., Memphis | | (1) | | | | | 88,108 | | | | 250,000 | |
Ridgeway Trace, Poplar Avenue and Ridgeway Road, Memphis | | (2) | | | | | 284,236 | | | | 222,553 | |
Summer Center, Summer Ave. at Waring Rd., Memphis | | | | | | | 139,021 | | | | 560,000 | |
Tennessee, Total | | | | | | | 963,875 | | | | 2,903,553 | |
| | | | | | | | | | | | | | |
Center and Location | | | | | | | Building Total | | | Land
Total | |
| | | | |
Texas | | | | | | | | | | | | | | |
10/Federal, I-10 at Federal, Houston | | | (1) | | | | | | 132,472 | | | | 474,000 | |
Alabama-Shepherd, S. Shepherd at W. Alabama, Houston | | | | | | | | | 56,969 | | | | 176,000 | |
Angelina Village, Hwy. 59 at Loop 287, Lufkin | | | | | | | | | 248,199 | | | | 1,835,000 | |
Bayshore Plaza, Spencer Hwy. at Burke Rd., Houston | | | | | | | | | 122,039 | | | | 196,000 | |
Bell Plaza, 45th Ave. at Bell St., Amarillo | | | (1) | | | | | | 130,631 | | | | 682,000 | |
Bellaire Boulevard, Bellaire at S. Rice, Houston | | | (1) | | | | | | 41,273 | | | | 137,000 | |
Boswell Towne Center, Highway 287 at Bailey Boswell Rd., Saginaw | | | | | | | | | 88,008 | | | | 137,000 | |
Braeswood Square, N. Braeswood at Chimney Rock, Houston | | | | | | | | | 104,686 | | | | 422,000 | |
Broadway, Broadway at 59th St., Galveston | | | (1) | | | | | | 74,604 | | | | 220,000 | |
Broadway, S. Broadway at W. 9th St., Tyler | | | | | | | | | 60,400 | | | | 259,000 | |
Calder, Calder at 24th St., Beaumont | | | | | | | | | 34,641 | | | | 95,000 | |
Cedar Bayou, Bayou Rd., La Marque | | | | | | | | | 45,561 | | | | 51,000 | |
Central Plaza, Loop 289 at Slide Rd., Lubbock | | | | | | | | | 151,677 | | | | 529,000 | |
Centre at Post Oak, Westheimer at Post Oak Blvd., Houston | | | | | | | | | 184,601 | | | | 505,000 | |
Champions Village, F.M. 1960 at Champions Forest Dr., Houston | | | (1) | | | | | | 384,581 | | | | 1,391,000 | |
Crossroads, I-10 at N. Main, Vidor | | | | | | | | | 115,692 | | | | 484,000 | |
Cullen Center, Cullen at Reed, Houston | | | | | | | | | 7,316 | | | | 30,000 | |
Cullen Plaza, Cullen at Wilmington, Houston | | | (1) | | | | | | 84,517 | | | | 318,000 | |
Custer Park, SWC Custer Road at Parker Road, Plano | | | | | | | | | 179,573 | | | | 376,000 | |
Cypress Pointe, F.M. 1960 at Cypress Station, Houston | | | | | | | | | 283,059 | | | | 737,000 | |
Eastpark, Mesa Rd. at Tidwell, Houston | | | | | | | | | 1,576 | | | | 85,262 | |
Edgebrook, Edgebrook at Gulf Fwy., Houston | | | (1) | | | | | | 78,460 | | | | 360,000 | |
Fiesta Trails, I-10 at DeZavala Rd., San Antonio | | | | | | | | | 482,370 | | | | 1,589,000 | |
Fiesta Village, Quitman at Fulton, Houston | | | (1) | | | | | | 30,249 | | | | 80,000 | |
Fondren/West Airport, Fondren at W. Airport, Houston | | | | | | | | | 37,717 | | | | 223,000 | |
Galveston Place, Central City Blvd. at 61st St., Galveston | | | | | | | | | 210,187 | | | | 828,000 | |
Gateway Station, I-35W and McAlister Rd., Burleson | | | (1) | | | | | | 68,500 | | | | 344,286 | |
Glenbrook Square, Telephone Road, Houston | | | (1) | | | | | | 77,890 | | | | 320,000 | |
Griggs Road, Griggs at Cullen, Houston | | | (1) | | | | | | 80,116 | | | | 382,000 | |
Harrisburg Plaza, Harrisburg at Wayside, Houston | | | (1) | | | | | | 93,438 | | | | 334,000 | |
Heights Plaza, 20th St. at Yale, Houston | | | | | | | | | 71,777 | | | | 228,000 | |
Horne Street Market, I-30 & Horne Street, Fort Worth | | | | | | | | | 42,267 | | | | 223,463 | |
Humblewood Shopping Plaza, Eastex Fwy. at F.M. 1960, Houston | | | | | | | | | 275,673 | | | | 784,000 | |
I-45/Telephone Rd. Center, I-45 at Maxwell Street, Houston | | | (1) | | | | | | 171,789 | | | | 658,586 | |
Independence Plaza, Town East Blvd., Mesquite | | | | | | | | | 170,363 | | | | 787,000 | |
Jacinto City, Market at Baca, Houston | | | (1) | | | | | | 49,138 | | | | 134,000 | |
Killeen Marketplace, 3200 E. Central Texas Expressway, Killeen | | | | | | | | | 251,137 | | | | 512,000 | |
Kirby Strip Center, Kirby Dr., Houston | | | | | | | | | 10,000 | | | | 37,897 | |
Lake Pointe Market Center, Dalrock Rd. at Lakeview Pkwy., Rowlett | | | | | | | | | 121,689 | | | | 218,158 | |
Las Tiendas Plaza, Expressway 83 at McColl Rd., McAllen | | | (1)(3) | | | | | | 500,067 | | | | 910,000 | |
Lawndale, Lawndale at 75th St., Houston | | | (1) | | | | | | 52,127 | | | | 177,000 | |
League City Plaza, I-45 at F.M. 518, League City | | | (1) | | | | | | 126,990 | | | | 680,000 | |
Little York Plaza, Little York at E. Hardy, Houston | | | (1) | | | | | | 113,878 | | | | 483,000 | |
Lone Star Pavilions, Texas at Lincoln Ave., College Station | | | | | | | | | 106,907 | | | | 439,000 | |
Lyons Avenue, Lyons at Shotwell, Houston | | | (1) | | | | | | 67,629 | | | | 178,000 | |
Market at Nolana, Nolana Ave. and 29th St., McAllen | | | (1)(3) | | | | | | 243,821 | | | | 181,300 | |
Market at Sharyland Place, U.S. Expressway 83 and Shary Rd., Mission | | | (1)(3) | | | | | | 301,174 | | | | 543,000 | |
Market at Town Center, Town Center Blvd., Sugar Land | | | | | | | | | 388,255 | | | | 1,733,000 | |
Market at Westchase, Westheimer at Wilcrest, Houston | | | | | | | | | 84,081 | | | | 318,000 | |
Montgomery Plaza, Loop 336 West at I-45, Conroe | | | | | | | | | 322,987 | | | | 1,156,784 | |
Moore Plaza, S. Padre Island Dr. at Staples, Corpus Christi | | | | | | | | | 599,622 | | | | 1,491,000 | |
North Creek Plaza, Del Mar Blvd. at Hwy. I-35, Laredo | | | | | | | | | 481,764 | | | | 1,251,000 | |
North Main Square, Pecore at N. Main, Houston | | | | | | | | | 18,515 | | | | 64,000 | |
| | | | | | | | | | | | |
Center and Location | | | | | | Building Total | | | Land
Total | |
| | | | |
North Oaks, F.M. 1960 at Veterans Memorial, Houston | | (1) | | | | | 405,186 | | | | 1,646,000 | |
North Park Plaza, Eastex Fwy. at Dowlen, Beaumont | | (1)(3) | | | | | 302,606 | | | | 636,000 | |
North Towne Plaza, U.S. 77 and 83 at SHFM 802, Brownsville | | (2) | | | | | 128,600 | | | | 303,715 | |
North Triangle, I-45 at F.M. 1960, Houston | | | | | | | 16,060 | | | | 113,000 | |
Northbrook Center, Northwest Fwy. at W. 34th, Houston | | | | | | | 173,288 | | | | 655,000 | |
Northcross, N. 10th St. at Nolana Loop, McAllen | | (1)(3) | | | | | 75,517 | | | | 218,000 | |
Northwest Crossing, N.W. Fwy. at Hollister, Houston | | (1)(3) | | | | | 300,310 | | | | 884,000 | |
Oak Forest, W. 43rd at Oak Forest, Houston | | | | | | | 151,324 | | | | 541,000 | |
Oak Park Village, Nacogdoches at New Braunfels, San Antonio | | (1) | | | | | 64,287 | | | | 221,000 | |
Old Navy Building, 1815 10th St., McAllen | | (1)(3) | | | | | 15,000 | | | | 62,000 | |
Orchard Green, Gulfton at Renwick, Houston | | | | | | | 74,983 | | | | 273,000 | |
Overton Park Plaza, SW Loop 820/Interstate 20 at South Hulen St., Ft. Worth | | | | | | | 465,259 | | | | 1,636,000 | |
Palmer Plaza, F.M. 1764 at 34th St., Texas City | | | | | | | 196,506 | | | | 367,000 | |
Parliament Square II, W. Ave. at Blanco, San Antonio | | | | | | | 54,541 | | | | 220,919 | |
Parliament Square, W. Ave. at Blanco, San Antonio | | | | | | | 64,950 | | | | 263,081 | |
Phelan West, Phelan at 23rd St., Beaumont | | (1)(3) | | | | | 82,221 | | | | 88,509 | |
Phelan, Phelan at 23rd St., Beaumont | | | | | | | 12,000 | | | | 63,000 | |
Pitman Corners, Custer Road at West 15th, Plano | | | | | | | 192,283 | | | | 699,000 | |
Plantation Centre, Del Mar Blvd. at McPherson Rd., Laredo | | | | | | | 143,110 | | | | 596,000 | |
Preston Shepard Place, Preston Rd. at Park Blvd., Plano | | (1)(3) | | | | | 363,337 | | | | 1,359,072 | |
Randall's/Cypress Station, F.M. 1960 at I-45, Houston | | | | | | | 136,891 | | | | 618,000 | |
Randall's/Kings Crossing, Kingwood Dr. at Lake Houston Pkwy., Houston | | (1) | | | | | 126,397 | | | | 624,000 | |
Randall's/Norchester, Grant at Jones, Houston | | | | | | | 105,076 | | | | 475,000 | |
Richmond Square, Richmond Ave. at W. Loop 610, Houston | | | | | | | 93,870 | | | | 135,000 | |
River Oaks East, W. Gray at Woodhead, Houston | | | | | | | 71,265 | | | | 206,000 | |
River Oaks West, W. Gray at S. Shepherd, Houston | | | | | | | 248,816 | | | | 609,000 | |
Rose-Rich, U.S. Hwy. 90A at Lane Dr., Rosenberg | | | | | | | 100,096 | | | | 386,000 | |
Sharyland Towne Crossing, Shary Rd. at Hwy. 83, Mission | | (1)(3) | | | | | 484,949 | | | | 2,008,000 | |
Sheldon Forest North, North, I-10 at Sheldon, Houston | | | | | | | 22,040 | | | | 131,000 | |
Sheldon Forest South, North, I-10 at Sheldon, Houston | | (1) | | | | | 75,340 | | | | 328,000 | |
Shops at Three Corners, S. Main at Old Spanish Trail, Houston | | (1) | | | | | 272,350 | | | | 1,007,143 | |
South 10th St. HEB, S. 10th St. at Houston St., McAllen | | (1)(3) | | | | | 103,702 | | | | 368,000 | |
Southgate, W. Fuqua at Hiram Clark, Houston | | (1) | | | | | 125,260 | | | | 533,000 | |
Spring Plaza, Hammerly at Campbell, Houston | | (1) | | | | | 59,166 | | | | 202,000 | |
Starr Plaza, U.S. Hwy. 83 at Bridge St., Rio Grande City | | (1)(3) | | | | | 176,693 | | | | 742,000 | |
Stella Link, Stella Link at S. Braeswood, Houston | | | | | | | 70,087 | | | | 423,588 | |
Studemont, Studewood at E. 14th St., Houston | | | | | | | 28,466 | | | | 91,000 | |
Ten Blalock Square, I-10 at Blalock, Houston | | | | | | | 97,277 | | | | 321,000 | |
Thousand Oaks, Thousand Oaks Dr. at Jones Maltsberger Rd., San Antonio | | (1) | | | | | 162,882 | | | | 730,000 | |
Tomball Marketplace, FM 2920 and Future 249, Tomball | | (2) | | | | | 227,735 | | | | 1,712,609 | |
Valley View, West Ave. at Blanco Rd., San Antonio | | | | | | | 91,544 | | | | 341,000 | |
Village Arcade, University at Kirby, Houston | | | | | | | 57,203 | | | | 276,503 | |
Village Arcade-Phase II, University at Kirby, Houston | | | | | | | 28,371 | | | | 60,099 | |
Village Arcade-Phase III, University at Kirby, Houston | | | | | | | 107,134 | | | | 231,156 | |
Village Plaza at Bunker Hill, Bunker Hill Rd. at Interstate 10, Houston | | (1)(3) | | | | | 495,204 | | | | 1,921,649 | |
Westchase Center, Westheimer at Wilcrest, Houston | | | | | | | 331,027 | | | | 754,000 | |
Westhill Village, Westheimer at Hillcroft, Houston | | | | | | | 130,041 | | | | 479,000 | |
Westwood Center, Culebra Road and Westwood Loop, San Antonio | | (2) | | | | | 44,085 | | | | 691,328 | |
Texas, Total | | | | | | | 15,616,987 | | | | 54,038,107 | |
| | | | |
Utah | | | | | | | | | | | | |
300 West, S. 300 West at Paxton Ave., Salt Lake City | | (1)(2)(3) | | | | | 181,309 | | | | 123,275 | |
Alpine Valley Center, Main St. at State St., American Fork | | (1)(3) | | | | | 224,654 | | | | 447,045 | |
Taylorsville Town Center, West 4700 South at Redwood Rd., Taylorsville | | | | | | | 134,214 | | | | 399,000 | |
| | | | | | | | | | | | | | |
Center and Location | | | | | | | Building
Total | | | Land
Total | |
| | | | |
West Jordan Town Center, West 7000 South at S. Redwood Rd., West Jordan | | | | | | | | | 304,899 | | | | 814,000 | |
Utah, Total | | | | | | | | | 845,076 | | | | 1,783,320 | |
| | | | |
Virginia | | | | | | | | | | | | | | |
Hilltop Village, Telegraph Rd. at Beulah Rd., Alexandria | | | (1)(2) | | | | | | 0 | | | | 1,437,480 | |
Virginia, Total | | | | | | | | | 0 | | | | 1,437,480 | |
| | | | |
Washington | | | | | | | | | | | | | | |
Meridian Town Center, Meridian Avenue East and 132nd Street East, Puyallup | | | (1)(3) | | | | | | 143,012 | | | | 535,000 | |
Mukilteo Speedway Center, Mukilteo Speedway, Lincoln Way, and Highway 99, Lynnwood | | | (1)(3) | | | | | | 90,273 | | | | 355,000 | |
Promenade 23, S. Jackson St. at 23rd Ave., Seattle | | | | | | | | | 96,660 | | | | 258,746 | |
Rainer Square Plaza, Rainer Avenue South and South Charleston Street, Seattle | | | (1)(3) | | | | | | 107,423 | | | | 345,000 | |
South Hill Center, 43rd Avenue Southwest and Meridian Street South, Puyallup | | | (1)(3) | | | | | | 134,010 | | | | 515,000 | |
Washington, Total | | | | | | | | | 571,378 | | | | 2,008,746 | |
| | | | |
Industrial | | | | | | | | | | | | | | |
| | | | |
California | | | | | | | | | | | | | | |
Siempre Viva Business Park, Siempre Viva Rd. at Kerns St., San Diego | | | (1)(3) | | | | | | 806,730 | | | | 1,460,002 | |
California, Total | | | | | | | | | 806,730 | | | | 1,460,002 | |
| | | | |
Florida | | | | | | | | | | | | | | |
1801 Massaro, 1801 Massaro Blvd., Tampa | | | | | | | | | 159,000 | | | | 337,000 | |
Hopewell Industrial Center, Old Hopewell Boulevard and U.S. Highway 301, Tampa | | | | | | | | | 224,483 | | | | 486,000 | |
Lakeland Industrial Center, I-4 at County Rd., Lakeland | | | | | | | | | 600,000 | | | | 1,535,000 | |
Lakeland Interstate Industrial Park I, Interstate Drive and Kathleen Rd., Lakeland | | | | | | | | | 168,400 | | | | 425,000 | |
Tampa East Industrial Portfolio, 1841 Massaro Blvd., Tampa | | | | | | | | | 512,923 | | | | 1,342,000 | |
Florida, Total | | | | | | | | | 1,664,806 | | | | 4,125,000 | |
| | | | |
Georgia | | | | | | | | | | | | | | |
6485 Crescent Drive, I-85 at Jimmy Carter Blvd., Norcross | | | (1)(3) | | | | | | 360,460 | | | | 965,000 | |
Atlanta Industrial Park, Atlanta Industrial Pkwy. at Atlanta Industrial Dr., Atlanta | | | | | | | | | 120,200 | | | | 381,918 | |
Kennesaw 75, 3850-3900 Kennesaw Pkwy., Kennesaw | | | | | | | | | 178,467 | | | | 491,000 | |
Riverview Distribution Center, Fulton Industrial Blvd. at Camp Creek Parkway, Atlanta | | | | | | | | | 430,200 | | | | 1,301,791 | |
Sears Logistics, 3700 Southside Industrial Way, Atlanta | | | (1)(3) | | | | | | 402,554 | | | | 890,000 | |
SouthPark 3075, Anvil Block Rd. and South Park Blvd., Atlanta | | | | | | | | | 234,525 | | | | 1,022,292 | |
Southside Industrial Parkway, Southside Industrial Pkwy. at Jonesboro Rd., Atlanta | | | | | | | | | 72,000 | | | | 242,000 | |
Westlake 125, Camp Creek Parkway and Westlake Parkway, Atlanta | | | | | | | | | 154,464 | | | | 422,048 | |
Georgia, Total | | | | | | | | | 1,952,870 | | | | 5,716,049 | |
| | | | |
Tennessee | | | | | | | | | | | | | | |
Crowfarn Drive Warehouse, Crowfarn Dr. at Getwell Rd., Memphis | | | (1)(3) | | | | | | 158,849 | | | | 315,000 | |
Outland Business Center, Outland Center Dr., Memphis | | | (1)(3) | | | | | | 410,438 | | | | 1,215,000 | |
Southpoint I & II, Pleasant Hill Rd. at Shelby Dr., Memphis | | | | | | | | | 570,940 | | | | 1,127,000 | |
Tennessee, Total | | | | | | | | | 1,140,227 | | | | 2,657,000 | |
| | | | |
Texas | | | | | | | | | | | | | | |
1625 Diplomat Drive, SWC Diplomat Dr. at McDaniel Dr., Carrollton | | | | | | | | | 106,140 | | | | 199,000 | |
610 and 11th St. Warehouse, Loop 610 at 11th St., Houston | | | | | | | | | 104,975 | | | | 202,000 | |
610 and 11th St. Warehouse, Loop 610 at 11th St., Houston | | | (1)(3) | | | | | | 243,642 | | | | 540,000 | |
610/288 Business Park, Cannon St., Houston | | | (1)(3) | | | | | | 295,300 | | | | 480,000 | |
Beltway 8 Business Park, Beltway 8 at Petersham Dr., Houston | | | | | | | | | 157,498 | | | | 499,000 | |
Blankenship Building, Kempwood Dr., Houston | | | | | | | | | 59,718 | | | | 175,000 | |
Braker 2 Business Center, Kramer Ln. at Metric Blvd., Austin | | | | | | | | | 27,359 | | | | 93,000 | |
Brookhollow Business Center, Dacoma at Directors Row, Houston | | | | | | | | | 133,970 | | | | 405,000 | |
Central Plano Business Park, Klein Rd. at Plano Pkwy., Plano | | | | | | | | | 137,785 | | | | 415,000 | |
Claywood Industrial Park, Clay at Hollister, Houston | | | | | | | | | 577,043 | | | | 1,357,242 | |
| | | | | | | | | | | | | | |
Center and Location | | | | | | | Building Total | | | Land
Total | |
| | | | |
Corporate Center Park I and II, Putnam Dr. at Research Blvd., Austin | | | | | | | | | 120,681 | | | | 326,000 | |
Crosspoint Warehouse, Crosspoint, Houston | | | | | | | | | 72,505 | | | | 179,000 | |
Crosswinds Distribution Center, Tech Com at Wurzback Parkway, San Antonio | | | | | | | | | 142,403 | | | | 470,012 | |
Freeport Business Center, 13215 N. Promenade Blvd., Stafford | | | | | | | | | 251,645 | | | | 635,000 | |
Freeport Commerce Center, Sterling Street and Statesman Drive, Irving | | | | | | | | | 50,590 | | | | 196,000 | |
Houston Cold Storage Warehouse, 7080 Express Lane, Houston | | | | | | | | | 128,752 | | | | 345,189 | |
Interwest Business Park, Alamo Downs Pkwy., San Antonio | | | | | | | | | 219,244 | | | | 742,000 | |
Isom Business Park, 919-981 Isom Road, San Antonio | | | | | | | | | 175,200 | | | | 462,000 | |
Jupiter Business Park, Jupiter Rd. at Summit Ave., Plano | | | | | | | | | 189,532 | | | | 447,553 | |
Jupiter Service Center, Jupiter near Plano Pkwy., Plano | | | | | | | | | 78,480 | | | | 234,000 | |
Kempwood Industrial, Kempwood Dr. at Blankenship Dr., Houston | | | (1)(3) | | | | | | 219,489 | | | | 530,000 | |
Kempwood Industrial, Kempwood Dr. at Blankenship Dr., Houston | | | | | | | | | 113,218 | | | | 327,000 | |
Lathrop Warehouse, Lathrop St. at Larimer St., Houston | | | (1)(3) | | | | | | 251,890 | | | | 435,000 | |
Manana Office Center, I-35 at Manana, Dallas | | | | | | | | | 222,916 | | | | 470,000 | |
McGraw Hill Distribution Center, 420 E. Danieldale Rd., DeSoto | | | | | | | | | 417,938 | | | | 888,000 | |
Midpoint I-20 Distribution Center, New York Avenue and Arbrook Boulevard, Arlington | | | | | | | | | 253,165 | | | | 593,000 | |
Midway Business Center, Midway at Boyington, Carrollton | | | | | | | | | 141,246 | | | | 309,000 | |
Navigation Business Park, Navigation at N. York, Houston | | | (1)(3) | | | | | | 238,014 | | | | 555,000 | |
Newkirk Service Center, Newkirk near N.W. Hwy., Dallas | | | | | | | | | 105,892 | | | | 223,000 | |
Northeast Crossing Office/Service Center, East N.W. Hwy. at Shiloh, Dallas | | | | | | | | | 78,700 | | | | 199,000 | |
Northway Park II, Loop 610 East at Homestead, Houston | | | (1)(3) | | | | | | 303,577 | | | | 745,000 | |
Oak Hills Industrial Park, Industrial Oaks Blvd., Austin | | | | | | | | | 89,858 | | | | 340,000 | |
O'Connor Road Business Park, O’Connor Road, San Antonio | | | | | | | | | 150,091 | | | | 459,000 | |
Railwood F, Market at U.S. 90, Houston | | | (1)(3) | | | | | | 300,000 | | | | 560,000 | |
Railwood G, Mesa at U.S. 90 , Houston | | | (1)(3) | | | | | | 210,850 | | | | 562,665 | |
Railwood Industrial Park, Mesa at U.S. 90, Houston | | | | | | | | | 402,680 | | | | 1,141,764 | |
Railwood Industrial Park, Mesa at U.S. 90, Houston | | | (1)(3) | | | | | | 497,656 | | | | 1,060,000 | |
Randol Mill Place, Randol Mill Road, Arlington | | | | | | | | | 54,639 | | | | 178,000 | |
Redbird Distribution Center, Joseph Hardin Dr., Dallas | | | | | | | | | 110,839 | | | | 233,000 | |
Regal Distribution Center, Leston Ave., Dallas | | | | | | | | | 202,559 | | | | 318,000 | |
Rutland 10 Business Center, Metric Blvd. at Centimeter Circle, Austin | | | | | | | | | 54,000 | | | | 139,000 | |
Sherman Plaza Business Park, Sherman at Phillips, Richardson | | | | | | | | | 101,140 | | | | 312,000 | |
Southpark A,B,C, East St. Elmo Rd. at Woodward St., Austin | | | | | | | | | 78,276 | | | | 238,000 | |
Southpoint Service Center, Burleson at Promontory Point Dr., Austin | | | | | | | | | 58,297 | | | | 234,000 | |
Southport Business Park 5, South Loop 610, Houston | | | | | | | | | 160,029 | | | | 358,000 | |
Space Center Industrial Park, Pulaski St. at Irving Blvd., Dallas | | | | | | | | | 264,582 | | | | 426,000 | |
Stonecrest Business Center, Wilcrest at Fallstone, Houston | | | | | | | | | 111,036 | | | | 308,000 | |
Town & Country Commerce Center, I-10 at Beltway 8, Houston | | | | | | | | | 206,056 | | | | 0 | |
West 10 Business Center II, Wirt Rd. at I-10, Houston | | | | | | | | | 82,658 | | | | 147,000 | |
West Loop Commerce Center, W. Loop N. at I-10, Houston | | | | | | | | | 35,886 | | | | 91,000 | |
West-10 Business Center, Wirt Rd. at I-10, Houston | | | | | | | | | 99,883 | | | | 331,000 | |
Westgate Service Center, Park Row Dr. at Whiteback Dr., Houston | | | | | | | | | 124,715 | | | | 499,000 | |
Texas, Total | | | | | | | | | 9,014,237 | | | | 21,611,425 | |
| | | | |
Virginia | | | | | | | | | | | | | | |
Enterchange at Meadowville, 2101 Bermuda Hundred Dr., Chester | | | (1)(3) | | | | | | 226,809 | | | | 845,717 | |
Enterchange at Northlake A, 11900-11998 North Lakeridge Parkway, Ashland | | | | | | | | | 215,077 | | | | 697,831 | |
Enterchange at Northlake C, North Lakeridge Parkway & Northlake Park Dr., Ashland | | | (1)(3) | | | | | | 510,262 | | | | 677,794 | |
Enterchange at Walthall A & B, 1900-1998 Ruffin Mill Rd., Colonial Heights | | | (1)(3) | | | | | | 606,679 | | | | 1,467,536 | |
Enterchange at Walthall C, 1936-1962 Ruffin Mill Rd., Colonial Heights | | | (1)(3) | | | | | | 261,922 | | | | 864,840 | |
Enterchange at Walthall D, 1700-1798 Ruffin Mill Rd., Colonial Heights | | | | | | | | | 287,318 | | | | 752,020 | |
Interport Business Center A, 4800-4890 Eubank Road, Richmond | | | (1)(3) | | | | | | 441,018 | | | | 1,037,556 | |
Interport Business Center B, 4700-4790 Eubank Road, Richmond | | | (1)(3) | | | | | | 118,000 | | | | 277,477 | |
Interport Business Center C, 5300-5390 Laburnum Ave., Richmond | | | (1)(3) | | | | | | 54,885 | | | | 154,202 | |
Virginia, Total | | | | | | | | | 2,721,970 | | | | 6,774,973 | |
| | | | | | | | |
Center and Location | | Building Total | | | Land
Total | |
| | |
Other | | | | | | | | |
| | |
Arizona | | | | | | | | |
Arcadia Biltmore Plaza, Campbell Ave. at North 36th St., Phoenix | | | 21,122 | | | | 74,000 | |
Arizona, Total | | | 21,122 | | | | 74,000 | |
| | |
Texas | | | | | | | | |
1919 North Loop West, Hacket Drive at West Loop 610 North, Houston | | | 138,163 | | | | 157,000 | |
Citadel Plaza, Citadel Plaza Dr., Houston | | | 121,000 | | | | 170,931 | |
Texas, Total | | | 259,163 | | | | 327,931 | |
| | |
Unimproved Land | | | | | | | | |
| | |
Arizona | | | | | | | | |
Bullhead Parkway at State Route 95, Bullhead City | | | | | | | 312,761 | |
Lon Adams Rd. at Tangerine Farms Rd., Marana | | | | | | | 422,532 | |
Southern Avenue and Signal Butte Road, Mesa | | | | | | | 90,605 | |
Arizona, Total | | | | | | | 825,898 | |
| | |
California | | | | | | | | |
Bear Valley Road at Jess Ranch Parkway Phase II, Apple Valley | | | | | | | 138,956 | |
Bear Valley Road at Jess Ranch Parkway Phase III, Apple Valley | | | | | | | 473,497 | |
California, Total | | | | | | | 612,453 | |
| | |
Colorado | | | | | | | | |
Highway 85 and Highway 285, Sheridan | | | | | | | 1,003,187 | |
Mississippi at Havana, Aurora | | | | | | | 669,953 | |
Colorado, Total | | | | | | | 1,673,140 | |
| | |
Florida | | | | | | | | |
SR 207 at Rolling Hills Dr., St. Augustine | | | | | | | 228,254 | |
State Road 100 & Belle Terre Parkway, Palm Coast | | | | | | | 292,288 | |
Young Pines and Curry Ford Rd., Orange County | | | | | | | 132,422 | |
Florida, Total | | | | | | | 652,964 | |
| | |
Georgia | | | | | | | | |
NWC South Fulton Pkwy. @ Hwy. 92, Union City | | | | | | | 3,554,496 | |
Georgia, Total | | | | | | | 3,554,496 | |
| | |
Louisiana | | | | | | | | |
70th St. at Mansfield Rd., Shreveport | | | | | | | 41,818 | |
Ambassador Caffery at W. Congress, Lafayette | | | | | | | 34,848 | |
Louisiana, Total | | | | | | | 76,666 | |
| | |
Nevada | | | | | | | | |
SWC Highway 215 at Decatur, Las Vegas | | | | | | | 707,414 | |
Nevada, Total | | | | | | | 707,414 | |
| | |
North Carolina | | | | | | | | |
Creedmoor (Highway 50) and Crabtree Valley Avenue, Raleigh | | | | | | | 510,959 | |
Highway 17 and Highway 210, Surf City | | | | | | | 2,024,233 | |
U.S. Highway 1 at Caveness Farms Rd., Wake Forest | | | | | | | 3,074,900 | |
U.S. Hwy. 17 & U.S. Hwy. 74/76, Leland | | | | | | | 549,727 | |
North Carolina, Total | | | | | | | 6,159,819 | |
| | | | |
2014Center and Location | | Land
Total
| |
| |
Tennessee
| | | | |
Poplar Avenue and Ridgeway Road, Memphis
| | | 53,579 | |
Tennessee, Total
| | | 53,579 | |
| |
Texas
| | | | |
9th Ave. at 25th St., Port Arthur
| | | 243,065 | |
Bissonnet at Wilcrest, Houston
| | | 40,946 | |
Citadel Plaza at 610 North Loop, Houston
| | | 137,214 | |
East Orem, Houston
| | | 121,968 | |
FM 1957 (Potranco Road) and FM 211, San Antonio
| | | 8,655,372 | |
FM 2920 and Highway 249, Tomball
| | | 459,776 | |
Highway 3 at Highway 1765, Texas City
| | | 200,812 | |
Kirkwood at Dashwood Drive, Houston
| | | 321,908 | |
Leslie Rd. at Bandera Rd., Helotes
| | | 74,052 | |
Mesa Road at Tidwell, Houston
| | | 35,719 | |
Nolana Ave. and 29th St., McAllen
| | | 163,350 | |
Northwest Freeway at Gessner, Houston
| | | 117,612 | |
River Pointe Drive at Interstate 45, Conroe
| | | 118,483 | |
Rock Prairie Rd. at Hwy. 6, College Station
| | | 394,218 | |
SH 151 and Ingram Rd., San Antonio
| | | 312,238 | |
Shary Rd. at North Hwy. 83, Mission
| | | 1,607,364 | |
U.S. 77 and 83 at SHFM 802, Brownsville
| | | 914,723 | |
US Hwy. 281 at Wilderness Oaks, San Antonio
| | | 1,269,774 | |
West Little York at Interstate 45, Houston
| | | 161,172 | |
West Loop North at Interstate 10, Houston
| | | 145,055 | |
Texas, Total
| | | 15,494,821 | |
| |
Utah
| | | | |
South 300 West & West Paxton Avenue, Salt Lake City
| | | 201,683 | |
Utah, Total
| | | 201,683 | |
Property Listing Summary
as of December 31, 2011
| | | Building Total | | | | Building Total | | | | Building Total | |
ALL PROPERTIES BY STATE | | Number of Properties | | | Building Total | | | Land Total | |
| | | |
Arizona | | | 24 | | | | 3,943,202 | | | | 11,901,321 | |
Arkansas | | | 3 | | | | 357,010 | | | | 1,489,000 | |
California | | | 30 | | | | 6,069,449 | | | | 19,283,512 | |
Colorado | | | 13 | | | | 4,195,447 | | | | 12,788,716 | |
Florida | | | 55 | | | | 13,438,234 | | | | 45,089,556 | |
Georgia | | | 23 | | | | 4,763,240 | | | | 19,637,801 | |
Illinois | | | 1 | | | | 303,566 | | | | 1,013,380 | |
Kansas | | | 1 | | | | 115,716 | | | | 444,000 | |
Kentucky | | | 4 | | | | 738,429 | | | | 3,102,384 | |
Louisiana | | | 11 | | | | 2,284,546 | | | | 6,316,953 | |
Maine | | | 1 | | | | 181,938 | | | | 962,667 | |
Missouri | | | 2 | | | | 257,649 | | | | 1,307,000 | |
Nevada | | | 12 | | | | 3,616,247 | | | | 10,952,124 | |
New Mexico | | | 4 | | | | 737,187 | | | | 2,084,140 | |
North Carolina | | | 24 | | | | 3,411,576 | | | | 23,147,229 | |
Oklahoma | | | 2 | | | | 163,996 | | | | 682,000 | |
Oregon | | | 3 | | | | 273,436 | | | | 672,288 | |
South Carolina | | | 1 | | | | 86,120 | | | | 436,000 | |
Tennessee | | | 9 | | | | 2,104,102 | | | | 5,614,132 | |
Texas | | | 149 | | | | 24,890,387 | | | | 91,472,284 | |
Utah | | | 4 | | | | 845,076 | | | | 1,985,003 | |
Virginia | | | 10 | | | | 2,721,970 | | | | 8,212,453 | |
Washington | | | 5 | | | | 571,378 | | | | 2,008,746 | |
| | | | | | | | | | | | |
| | | |
Grand Total | | | 391 | | | | 76,069,901 | | | | 270,602,689 | |
| | | | | | | | | | | | |
| | | |
Total Retail | | | 313 | | | | 58,488,776 | | | | 197,843,376 | |
Total Industrial | | | 75 | | | | 17,300,840 | | | | 42,344,449 | |
Total Unimproved Land | | | | | | | | | | | 30,012,933 | |
Total Other | | | 3 | | | | 280,285 | | | | 401,931 | |
Total square footage includes 464,561 square feet of building area and 13,354,380 square feet of land leased from others.
Footnotes for detail property listing:
(1) | Denotes property is held by a real estate joint venture or partnership; however, the building and land square feet figures include our partners’ ownership interest in the property.
|
(2) | Denotes property currently under development.
|
(3) | Denotes properties that are not consolidated under generally accepted accounting principles.
|
NOTE: | Square feet are reflective of area available to be leased. Certain listed properties may have additional square feet that are not owned by us.
|
General. In 2011, no single property accounted for more than 2.9% of our total assets or 1.8% of revenues. The five largest properties, in the aggregate, represented approximately 7.9% of our revenues for the year ended December 31, 2011; otherwise, none of the remaining properties accounted for more than 1.3% of our revenues during the same period. As of December 31, 2011, the weighted average occupancy rate for all of our properties was 92.1% compared to 91.9% as of December 31, 2010. The average effective annual rental per square foot was approximately $13.79 in 2011, $13.60 in 2010, $13.31 in 2009, $13.16 in 2008 and $12.57 in 2007 for retail properties and $4.86 in 2011, $4.83 in 2010, $4.90 in 2009, $4.98 in 2008 and $4.86 in 2007 for industrial properties.
As of December 31, 2011, lease expirations for the next 10 years, assuming tenants do not exercise renewal options, are as follows:
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | Annual Net Rent
Of Expiring Leases | |
Year | | Number of
Expiring Leases | | | Square Feet of
Expiring Leases
(000’s) | | | Percentage of
Leaseable
Square Feet | | | Total
(000’s) | | | Per Square
Foot | |
2012 | | | 783 | | | | 3,582 | | | | 6.85 | | | $ | 45,719 | | | $ | 12.76 | |
2013 | | | 1,059 | | | | 6,086 | | | | 11.64 | | | | 69,944 | | | | 11.49 | |
2014 | | | 937 | | | | 5,750 | | | | 11.00 | | | | 62,876 | | | | 10.93 | |
2015 | | | 740 | | | | 4,982 | | | | 9.53 | | | | 56,413 | | | | 11.32 | |
2016 | | | 714 | | | | 4,815 | | | | 9.21 | | | | 58,670 | | | | 12.18 | |
2017 | | | 261 | | | | 2,849 | | | | 5.45 | | | | 34,162 | | | | 11.99 | |
2018 | | | 133 | | | | 1,560 | | | | 2.98 | | | | 19,358 | | | | 12.41 | |
2019 | | | 78 | | | | 1,178 | | | | 2.25 | | | | 14,173 | | | | 12.03 | |
2020 | | | 79 | | | | 1,122 | | | | 2.15 | | | | 14,323 | | | | 12.77 | |
2021 | | | 124 | | | | 1,696 | | | | 3.24 | | | | 21,894 | | | | 12.91 | |
In the ordinary course of business we have tenants who cease making payments under their leases or who file for bankruptcy protection. We are unable to predict or forecast the timing of store closings or unexpected vacancies. While we believe the effect of this will not have a material impact on our financial position, results of operations or liquidity due to the significant diversification of our tenant base, the uncertainty in the economy and commercial credit markets could have a negative impact on us.
The majority of our properties are owned directly by us (subject in some cases to mortgages), although our interests in some properties are held indirectly through interests in real estate joint ventures or under long-term leases. In our opinion, our properties are well maintained and in good repair, suitable for their intended uses, and adequately covered by insurance.
We participate in 65 real estate joint ventures or partnerships that hold an interest in 148 of our properties. Our ownership interest ranges from 7.8% to 99%; we are normally the managing or operating partner and receive a fee for acting in this capacity.
We may use a DownREIT operating partnership structure in the acquisition of some real estate properties. In these transactions, a fair value purchase price is agreed upon between us, as general partner of the DownREIT, and the seller where the seller receives operating partnership units in exchange for some or all of its ownership interest in the property. Each operating partnership unit is the equivalent of one of our common shares. These units generally give our partners the right to put their limited partnership units to us on or after the first anniversary of the entity’s formation. We may acquire these limited partnership units for either cash or a fixed number of our common shares at our discretion.
Shopping Centers. At December 31, 2011, we owned or operated under long-term leases, either directly or through our interest in real estate joint ventures or partnerships, a total of 302234 developed income-producing propertiescenters, primarily neighborhood and 11 propertiescommunity shopping centers and three centers under various stages of construction and development, which are located in 2321 states spanning the country from coast to coast.
coast with approximately 45.3 million square feet of gross leasable area. Our shoppingcenters are located principally in the South, West Coast and Southeast Coast of the U.S. with significant concentrations in Arizona, California, Florida, and Texas. We also owned interests in 34 parcels of land that totaled approximately 25.3 million square feet at December 31, 2014. These land parcels include approximately 1.6 million square feet of land adjacent to certain of our existing operating centers, which may be used for expansion of these centers, as well as approximately 23.7 million square feet of land, which may be used for new development.
In 2014, no single center accounted for more than 3.4% of our total assets or 2.0% of base minimum rental revenues. The five largest centers, in the aggregate, represented approximately 9.4% of our base minimum rental revenues for the year ended December 31, 2014; otherwise, none of the remaining centers accounted for more than 1.8% of our base minimum rental revenues during the same period.
Our centers are designed to attract local area customers and are typically anchored by a supermarket or other national tenants (such as Kroger, Target or T.J. Maxx). The centers are primarily neighborhood and community shopping centers that
often include discounters, warehouse clubs, dollar stores and specialty grocers as additional anchors or tenants, and typically range in size from 50,000 to 650,000 square feet of building
area, as distinguished from large regional enclosed malls and small strip centers, which generally contain 5,000 to 25,000 square feet. Nonearea. Very few of the centers have
climatizedclimate-controlled common areas, but are designed to allow retail customers to park their automobiles in close proximity to any retailer in the center. Our centers are customarily constructed of masonry, steel and glass, and all have lighted, paved parking areas, which are typically landscaped with berms, trees and shrubs. They are generally located at major intersections in close proximity to neighborhoods that have existing populations sufficient to support retail activities of the types conducted in our centers.
We actively embrace various initiatives that support the future of environmentally friendly shopping centers. Our primary areas of focus include energy efficiency, waste recycling, water conservation and construction/development best practices. We recognize there are economic, environmental and social implications associated with the full range of our sustainability efforts, and that a commitment to incorporating sustainable practices will add long-term value to our centers
As of December 31, 2014, the weighted average occupancy rate for our centers was 95.5% compared to 94.9% as of December 31, 2013. The average base rent per square foot was approximately $16.24 in 2014, $15.66 in 2013, $15.14 in 2012, $13.79 in 2011 and $13.60 in 2010 for our centers.
We have approximately 7,5005,800 separate leases with 5,2003,800 different tenants. Included among our top revenue-producing tenants are: The Kroger Co., T.J.X.TJX Companies, Safeway,Inc., Ross Stores, H E Butt Grocery,Inc., H-E-B, Safeway Inc., Office Depot, Inc., PetSmart, Inc., Bed, Bath & Beyond Inc., Home Depot, Office Depot, PetSmartInc., Best Buy, Inc., The Sports Authority, Inc. and Harris Teeter.Whole Foods Market, Inc. The diversity of our tenant base is also evidenced by the fact that our largest tenant, The Kroger Co., accounted for only 3.2%3.5% of base minimum rental revenues during 2011.Our shopping center leases have
2014.
Tenant Lease Expirations
As of December 31, 2014, lease terms generally ranging from three to five yearsexpirations for tenant space under 5,000 square feet and from 10 to 25 years for tenant space over 10,000 square feet. Leases with primary lease terms in excess ofthe next 10 years, generally for anchor and out-parcels, frequently containassuming tenants do not exercise renewal options, which allow the tenant to extend the term of the lease for one or more additional periods, with each of these periods generally being of a shorter duration than the primary lease term. The rental rates paid during a renewal period are generally based upon the rental rate for the primary term; sometimes adjusted for inflation, market conditions or an amount of the tenant’s sales during the primary term.Most of our leases provide for the monthly payment in advance of fixed minimum rentals, the tenants’ pro rata share of real estate taxes, insurance (including fire and extended coverage, rent insurance and liability insurance) and common area maintenance for the center (based on estimates of the costs for these items). They also provide for the payment of additional rentals based on a percentage of the tenants’ sales. Utilities are generally paid directly by tenants except where common metering exists with respect to a center. In this case, we make payments for the utilities, and the tenants reimburse us on a monthly basis. Generally, our leases prohibit the tenant from assigning or subletting its space. They also require the tenant to use its space for the purpose designated in its lease agreement and to operate its business on a continuous basis. Some of the lease agreements with major tenants contain modifications of these basic provisions in view of the financial condition, stability or desirability of those tenants. Where a tenant is granted the right to assign its space, the lease agreement generally provides that the original lessee will remain liable for the payment of the lease obligations under that lease agreement.
During 2011, we acquired two retail shopping centers located one each in Colorado and Washington for approximately $42.9 million.
In April 2011, we acquired a 50%-owned unconsolidated real estate joint venture interest in three retail properties in Jacksonville, Florida for approximately $11.6 million and purchased our partner’s 50% unconsolidated interest in a property in Palm Coast, Florida for $11.5 million, which included their share of a construction note obligation.
During 2011, we sold one retail building and eight retail shopping centers, of which five were located in Texas and one each in Florida, Kansas, as follows:
|
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | Annual Rent of Expiring Leases |
| Year | | Number of Expiring Leases | | Square Feet of Expiring Leases (000’s) | | Percentage of Leaseable Square Feet | | Total (000’s) | | Per Square Foot | | Percentage of Total Annual Net Rent |
| 2015 | | 607 |
| | 2,157 |
| | 4.76 | % | | $ | 36,355 |
| | $ | 16.85 |
| | 9.83 | % |
| 2016 | | 764 |
| | 3,623 |
| | 8.00 | % | | 58,375 |
| | 16.11 |
| | 15.78 | % |
| 2017 | | 655 |
| | 3,187 |
| | 7.04 | % | | 54,469 |
| | 17.09 |
| | 14.72 | % |
| 2018 | | 564 |
| | 3,357 |
| | 7.41 | % | | 51,421 |
| | 15.32 |
| | 13.90 | % |
| 2019 | | 492 |
| | 3,226 |
| | 7.12 | % | | 47,502 |
| | 14.72 |
| | 12.84 | % |
| 2020 | | 193 |
| | 2,117 |
| | 4.67 | % | | 26,830 |
| | 12.67 |
| | 7.25 | % |
| 2021 | | 116 |
| | 1,374 |
| | 3.03 | % | | 19,326 |
| | 14.07 |
| | 5.22 | % |
| 2022 | | 88 |
| | 1,024 |
| | 2.26 | % | | 16,114 |
| | 15.74 |
| | 4.36 | % |
| 2023 | | 82 |
| | 706 |
| | 1.56 | % | | 11,432 |
| | 16.19 |
| | 3.09 | % |
| 2024 | | 109 |
| | 1,122 |
| | 2.48 | % | | 17,312 |
| | 15.43 |
| | 4.68 | % |
New
Mexico and North Carolina. Gross sales proceeds from these dispositions totaled $83.1 million and generated gains of $8.6 million.We have a real estate limited partnership agreement with a foreign institutional investor to purchase up to $280 million of retail properties in various states. Our ownership in this unconsolidated real estate limited partnership is 51%. To date, no properties have been purchased.
Development
Industrial Properties.At December 31, 2011, we owned, either directly or through our interest in real estate joint ventures or partnerships, 75 industrial projects and three other operating properties totaling approximately 17.7 million square feet of building area. Our industrial properties consist of bulk warehouse, business distribution and office-service center assets ranging in size from 9,000 to 727,000 square feet. Similar to our shopping centers, these properties are customarily constructed of masonry, steel and glass, and have lighted, concrete parking areas and are well landscaped. Some of the national and regional tenants in our industrial properties include Sears Logistics Services, Publix, Shell Oil Company, Rooms to Go, Rooftop Systems Inc.2014, Fed Ex, Mazda, McGraw Hill and Iron Mountain. Our properties are located in Arizona, California, Florida, Georgia, Tennessee, Texas and Virginia.During 2011, we sold three industrial properties, of which two are located in Georgia and one in Texas, with gross sales proceeds totaling $13.5 million, which generated a gain of $1.6 million. Also, an unconsolidated real estate joint venture sold two industrial buildings with gross sales proceeds aggregating $7.6 million, which did not generate a gain.
Land Held for Development. At December 31, 2011, we owned, either directly or through our interest in real estate joint ventures or partnerships, 40 parcels of unimproved land consisting of approximately 30.0 million square feet of land area located in Arizona, California, Colorado, Florida, Georgia, Louisiana, Nevada, North Carolina, Tennessee, Texas and Utah. These properties include approximately 2.5 million square feet of land adjacent to certain of our existing developed properties, which may be used for expansion of these developments, as well as approximately 27.5 million square feet of land, which may be used for new development. Almost all of the land held for development is served by roads and utilities and are suitable for development as shopping centers or industrial projects, and we intend to emphasize the development of these parcels for such purpose. We have approximately $124.5 million in land held for development. Due to our analysis of current economic considerations, including the effects of tenant bankruptcies, credit availability to retailers, reduction of tenant expansion plans for new development projects, declines in real estate values and any changes to our plans related to our new development properties, including land held for development, we recorded an impairment charge of $23.6 million related to land held for development for the year ended December 31, 2011. During 2011, we sold 11 land parcels, of which seven were located in Texas, and two each in Nevada and North Carolina. Gross sales proceeds from these sales totaled $20.6 million and generated gains of $1.5 million.
New Development Properties. At December 31, 2011, we had 11 propertiesfour projects in various stages of development, includingof which we own, partially or wholly, three newly acquired projects located in Florida, Georgiaproperties and Virginia.have a contractual commitment to purchase the retail portion of a mixed-use property. We have funded $143.3$82.8 million to date on these projects, and weprojects. We estimate our aggregate net investment upon completion to be $193.7$156.6 million after consideration of anticipated land sales and tax incentive financing which is estimated. These projects are forecasted to be $24.6 million. These properties have an average projectedstabilized return on investment of approximately 7.2%7.7% when completed. Upon completion, the square footage to be added to the portfolio and the estimated cost per square foot of these four projects are as follows:
|
| | | | |
Estimated Year of Completion | | Square Feet (000’s) | | Estimated Cost per Square Foot |
| 2015 | | 357 | | $230.31 |
| 2016 | | 138 | | 328.32 |
| 2017 | | 63 | | 465.35 |
Property Listing
The following table is a list of centers, summarized by state and includes our share of both consolidated and unconsolidated real estate partnerships and joint ventures as of December 31, 2014:
|
| | | | | | | | | |
| ALL PROPERTIES BY STATE | | Number of Properties | | Gross Leasable Area (GLA) | | % of Total GLA |
| Arizona | | 23 |
| | 3,882,837 |
| | 8.6 | % |
| Arkansas | | 3 |
| | 355,410 |
| | 0.8 | % |
| California | | 26 |
| | 4,933,349 |
| | 10.9 | % |
| Colorado | | 9 |
| | 2,746,258 |
| | 6.1 | % |
| Florida | | 35 |
| | 7,470,927 |
| | 16.5 | % |
| Georgia | | 14 |
| | 2,673,974 |
| | 5.9 | % |
| Kentucky | | 4 |
| | 761,919 |
| | 1.7 | % |
| Louisiana | | 3 |
| | 517,305 |
| | 1.1 | % |
| Maryland | | 2 |
| | 83,050 |
| | 0.2 | % |
| Missouri | | 1 |
| | 56,734 |
| | 0.1 | % |
| Nevada | | 12 |
| | 3,818,471 |
| | 8.4 | % |
| New Mexico | | 2 |
| | 259,087 |
| | 0.6 | % |
| North Carolina | | 16 |
| | 2,649,998 |
| | 5.9 | % |
| Oklahoma | | 1 |
| | 128,231 |
| | 0.3 | % |
| Oregon | | 3 |
| | 276,924 |
| | 0.6 | % |
| South Carolina | | 1 |
| | 86,694 |
| | 0.2 | % |
| Tennessee | | 5 |
| | 848,345 |
| | 1.9 | % |
| Texas | | 68 |
| | 12,576,407 |
| | 27.8 | % |
| Utah | | 3 |
| | 471,206 |
| | 1.0 | % |
| Virginia | | 1 |
| | 130,876 |
| | 0.3 | % |
| Washington | | 5 |
| | 563,623 |
| | 1.2 | % |
| Total | | 237 |
| | 45,291,625 |
| | 100 | % |
___________________
Total square footage includes 518,056 square feet of leased from others and 11.4 million square feet not owned or managed by us. Additionally, encumbrances on our properties total $.6 billion. See Schedule III for additional information.
The following table is a detailed list of centers, by state and includes our share of both consolidated and unconsolidated real estate partnerships and joint ventures as of December 31, 2014:
|
| | | | | | | | | | | | | | |
| Center | | CBSA (5) | | Owned % | | Foot Notes | | GLA | | Grocer Anchor ( ) indicates owned by others | | Other Anchors ( ) indicates owned by others |
| Operating Properties | | | | | | | | | | |
| Arizona | | | | | | | | | | | | |
| Mohave Crossroads | | Lake Havasu City-Kingman, AZ | | 100.0 | % | |
| | 395,477 |
| |
| | (Target), (Kohl's), PetSmart, Staples, Bed Bath & Beyond, Ross Dress for Less |
| Arcadia Biltmore Plaza | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 21,122 |
| |
| | Weingarten Realty Regional Office, Endurance Rehab |
| Arrowhead Festival S.C. | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 194,309 |
| |
| | (Sports Authority), (Toys “R” Us), (Bed Bath & Beyond) |
| Broadway Marketplace | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 87,379 |
| |
| | Office Max, Ace Hardware |
| Camelback Village Square | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 240,951 |
| | Fry’s Supermarket | | Office Max |
| Desert Village | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 107,071 |
| | AJ Fine Foods | | CVS |
| Fountain Plaza | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 305,588 |
| | Fry’s Supermarket | | Dollar Tree, (Lowe's) |
| Laveen Village Market | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 318,805 |
| | (Fry’s Supermarket) | | (Home Depot) |
|
| | | | | | | | | | | | | | |
| Center | | CBSA (5) | | Owned % | | Foot Notes | | GLA | | Grocer Anchor ( ) indicates owned by others | | Other Anchors ( ) indicates owned by others |
| Monte Vista Village Center | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 108,551 |
| | (Safeway) | |
|
| Palmilla Center | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 178,219 |
| | (Fry’s Supermarket) | | Office Max, PetSmart, Dollar Tree |
| Pueblo Anozira | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 157,607 |
| | Fry’s Supermarket | | Petco, Dollar Tree |
| Raintree Ranch | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 133,020 |
| | Whole Foods | |
|
| Rancho Encanto | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 72,170 |
| |
| | Smart & Final |
| Red Mountain Gateway | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 199,013 |
| |
| | (Target), Bed Bath & Beyond, Famous Footwear |
| Scottsdale Horizon | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 155,006 |
| | Safeway | | CVS |
| Squaw Peak Plaza | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 60,728 |
| | Sprouts Farmers Market | |
|
| The Shoppes at Parkwood Ranch | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 106,738 |
| |
| | Hobby Lobby, Dollar Tree |
| Valley Plaza | | Phoenix-Mesa-Scottsdale, AZ | | 100.0 | % | |
| | 154,588 |
| | US Foods | | Ross Dress for Less |
| Entrada de Oro | | Tucson, AZ | | 100.0 | % | |
| | 109,075 |
| | Walmart Neighborhood Market | |
|
| Madera Village | | Tucson, AZ | | 100.0 | % | |
| | 106,858 |
| | Safeway | | Walgreens, Dollar Tree |
| Oracle Crossings | | Tucson, AZ | | 100.0 | % | |
| | 261,194 |
| | Sprouts Farmers Market | | Kohl's, Home Goods |
| Oracle Wetmore | | Tucson, AZ | | 100.0 | % | |
| | 343,237 |
| |
| | (Home Depot), (Jo Ann Fabric) Cost Plus, PetSmart, Walgreens, Ulta Beauty |
| Shoppes at Bears Path | | Tucson, AZ | | 100.0 | % | |
| | 66,131 |
| |
| | (Osco Drug) |
| Arizona Total: | | | | | | | | 3,882,837 |
| | | | |
| Arkansas | | | | | | | | | | | | |
| Markham Square | | Little Rock-N. Little Rock, AR | | 100.0 | % | |
| | 124,284 |
| |
| | Burlington Coat Factory, Ross Dress for Less |
| Markham West | | Little Rock-N. Little Rock, AR | | 100.0 | % | |
| | 178,500 |
| |
| | Academy, Office Depot, Michaels, Dollar Tree |
| Westgate | | Little Rock-N. Little Rock, AR | | 100.0 | % | |
| | 52,626 |
| |
| | Stein Mart |
| Arkansas Total: | | | | | | | | 355,410 |
| | | | |
| California | | | | | | | | | | | | |
| 8000 Sunset Strip Shopping Center | | Los Angeles-Long Beach et al, CA | | 100.0 | % | |
| | 171,551 |
| | Trader Joe's | | Crunch, Sundance Cinemas, CB2 |
| Buena Vista Marketplace | | Los Angeles-Long Beach et al, CA | | 100.0 | % | |
| | 90,805 |
| | Ralph's | | Dollar Tree |
| Centerwood Plaza | | Los Angeles-Long Beach et al, CA | | 100.0 | % | |
| | 75,486 |
| | Superior Grocers | | Dollar Tree |
| Westminster Center | | Los Angeles-Long Beach et al, CA | | 100.0 | % | |
| | 440,437 |
| | Albertsons | | Home Depot, Ross Dress for Less, Petco, Rite Aid, Dollar Tree, 24 Hour Fitness |
| Hallmark Town Center | | Madera, CA | | 100.0 | % | |
| | 98,359 |
| | Food 4 Less | | Bally Total Fitness |
| Marshalls Plaza | | Modesto, CA | | 100.0 | % | |
| | 85,952 |
| |
| | Marshalls, Dress Barn, Guitar Center |
| Chino Hills Marketplace | | Riverside et al, CA | | 100.0 | % | |
| | 310,920 |
| | Von’s | | Dollar Tree, 24 Hour Fitness, Rite Aid |
| Jess Ranch Marketplace | | Riverside et al, CA | | 100.0 | % | |
| | 307,826 |
| | (Winco Foods) | | Burlington Coat Factory, PetSmart, Rite Aid, Big 5 |
| Jess Ranch Phase III | | Riverside et al, CA | | 100.0 | % | |
| | 194,342 |
| | (Winco Foods) | | Best Buy, Cinemark Theatres, Bed Bath & Beyond, 24 Hour Fitness |
| Menifee Town Center | | Riverside et al, CA | | 100.0 | % | |
| | 258,734 |
| | Ralph's | | Ross Dress for Less, Dollar Tree |
| Stoneridge Town Centre | | Riverside et al, CA | | 67.0 | % | | (1)(3) | | 434,450 |
| | (Super Target) | | (Kohl's) |
| Discovery Plaza | | Sacramento-Arden et al, CA | | 100.0 | % | |
| | 93,398 |
| | Bel Air Market | |
|
| Prospectors Plaza | | Sacramento-Arden et al, CA | | 100.0 | % | |
| | 252,521 |
| | SaveMart | | Kmart, CVS, Ross |
| Summerhill Plaza | | Sacramento-Arden et al, CA | | 100.0 | % | |
| | 128,835 |
| | Raley’s | | Dollar Tree |
| Valley | | Sacramento-Arden et al, CA | | 100.0 | % | |
| | 107,005 |
| | Raley's | |
|
| El Camino Promenade | | San Diego-Carlsbad et al, CA | | 100.0 | % | |
| | 129,676 |
| |
| | T.J. Maxx, Staples, Dollar Tree |
| Rancho San Marcos Village | | San Diego-Carlsbad et al, CA | | 100.0 | % | |
| | 134,628 |
| | Von’s | | 24 Hour Fitness |
| San Marcos Plaza | | San Diego-Carlsbad et al, CA | | 100.0 | % | |
| | 81,086 |
| | (Albertsons) | |
|
| 580 Market Place | | San Francisco-Oakland et al, CA | | 100.0 | % | |
| | 100,097 |
| | Safeway | | 24 Hour Fitness, Petco |
| Fremont Gateway Plaza | | San Francisco-Oakland et al, CA | | 100.0 | % | |
| | 368,701 |
| | Raley’s | | 24 Hour Fitness, (Walgreens) |
| Greenhouse Marketplace | | San Francisco-Oakland et al, CA | | 100.0 | % | |
| | 236,427 |
| | (Safeway) | | (CVS), Jo-Ann Fabrics, 99 Cents Only, Factory 2 U, Petco |
| Silver Creek Plaza | | San Jose-Sunnyvale et al, CA | | 100.0 | % | |
| | 202,820 |
| | Safeway | | Walgreens, (Orchard Supply) |
| Freedom Centre | | Santa Cruz-Watsonville, CA | | 100.0 | % | |
| | 150,865 |
| | Safeway | | Rite Aid, Big Lots |
| Stony Point Plaza | | Santa Rosa-Petaluma, CA | | 100.0 | % | |
| | 200,011 |
| | Food Maxx | | Ross Dress for Less, Fallas Paredes |
| Creekside Center | | Vallejo-Fairfield, CA | | 100.0 | % | |
| | 115,991 |
| | Raley’s | |
|
| Southampton Center | | Vallejo-Fairfield, CA | | 100.0 | % | |
| | 162,426 |
| | Raley’s | | Ace Hardware, Dollar Tree |
| California Total: | | | | | | | | 4,933,349 |
| | | | |
| Colorado | | | | | | | | | | | | |
| Aurora City Place | | Denver-Aurora, CO | | 50.0 | % | | (1)(3) | | 542,956 |
| | (Super Target) | | Sports Authority, Barnes & Noble, Ross Dress For Less, PetSmart |
| Cherry Creek | | Denver-Aurora, CO | | 100.0 | % | |
| | 272,658 |
| | (Super Target) | | Sports Authority, PetSmart |
| CityCenter Englewood | | Denver-Aurora, CO | | 51.0 | % | | (1)(3) | | 359,103 |
| |
| | (Walmart), Ross Dress for Less, Petco, Office Depot, Bally Total Fitness |
| Crossing at Stonegate | | Denver-Aurora, CO | | 51.0 | % | | (1)(3) | | 109,082 |
| | King Sooper’s | |
|
|
| | | | | | | | | | | | | | |
| Center | | CBSA (5) | | Owned % | | Foot Notes | | GLA | | Grocer Anchor ( ) indicates owned by others | | Other Anchors ( ) indicates owned by others |
| Edgewater Marketplace | | Denver-Aurora, CO | | 100.0 | % | |
| | 270,548 |
| | King Sooper's | | Ace Hardware, (Target) |
| Green Valley Ranch Towne Center | | Denver-Aurora, CO | | 50.0 | % | | (1)(3) | | 114,881 |
| | (King Sooper’s) | |
|
| Lowry Town Center | | Denver-Aurora, CO | | 50.0 | % | | (1)(3) | | 129,398 |
| | (Albertsons) | |
|
| River Point at Sheridan | | Denver-Aurora, CO | | 100.0 | % | |
| | 561,505 |
| |
| | (Target), (Costco), Regal Cinema, Michaels, Conn's |
| Thorncreek Crossing | | Denver-Aurora, CO | | 51.0 | % | | (1)(3) | | 386,127 |
| | Sprouts, (Super Target) | | Barnes & Noble, Cost Plus, Michaels, OfficeMax, Dollar Tree |
| Colorado Total: | | | | | | | | 2,746,258 |
| | | | |
| Florida | | | | | | | | | | | | |
| Argyle Village | | Jacksonville, FL | | 100.0 | % | |
| | 315,432 |
| | Publix | | Bed Bath & Beyond, T.J. Maxx, Babies “R” Us, Jo-Ann’s Fabrics, Michaels |
| Atlantic West | | Jacksonville, FL | | 50.0 | % | | (1)(3) | | 180,578 |
| |
| | T.J. Maxx, Dollar Tree, Shoe Carnival, (Kohl's) |
| Epic Village - St. Augustine | | Jacksonville, FL | | 70.0 | % | | (1) | | 64,180 |
| |
| | (Epic Theaters) |
| Kernan Village | | Jacksonville, FL | | 50.0 | % | | (1)(3) | | 288,780 |
| | (Walmart Supercenter) | | Ross Dress for Less, Petco |
| Boca Lyons | | Miami-Fort Lauderdale et al, FL | | 100.0 | % | |
| | 117,423 |
| | 4th Generation Market | | Ross Dress for Less |
| Embassy Lakes | | Miami-Fort Lauderdale et al, FL | | 100.0 | % | |
| | 179,937 |
| | Winn Dixie | | Tuesday Morning, Dollar Tree |
| Flamingo Pines | | Miami-Fort Lauderdale et al, FL | | 100.0 | % | |
| | 266,761 |
| | (Walmart Supercenter) | | U.S. Post Office, Florida Technical College |
| Flamingo Pines | | Miami-Fort Lauderdale et al, FL | | 20.0 | % | | (1)(3) | | 148,840 |
| | Publix | |
|
| Hollywood Hills Plaza | | Miami-Fort Lauderdale et al, FL | | 20.0 | % | | (1)(3) | | 405,145 |
| | Publix | | Target, CVS |
| Northridge | | Miami-Fort Lauderdale et al, FL | | 20.0 | % | | (1)(3) | | 236,628 |
| | Publix | | Petco, Ross Dress for Less, Dollar Tree |
| Pembroke Commons | | Miami-Fort Lauderdale et al, FL | | 20.0 | % | | (1)(3) | | 316,262 |
| | Publix | | Marshalls, Office Depot, LA Fitness, Dollar Tree |
| Sunrise West Shopping Center | | Miami-Fort Lauderdale et al, FL | | 25.0 | % | | (1)(3) | | 84,597 |
| | Publix | |
|
| Tamiami Trail Shops | | Miami-Fort Lauderdale et al, FL | | 20.0 | % | | (1)(3) | | 132,564 |
| | Publix | | CVS |
| TJ Maxx Plaza | | Miami-Fort Lauderdale et al, FL | | 100.0 | % | |
| | 161,429 |
| | Winn Dixie | | T.J. Maxx, Dollar Tree |
| Vizcaya Square | | Miami-Fort Lauderdale et al, FL | | 100.0 | % | |
| | 110,081 |
| | Winn Dixie | |
|
| Sea Ranch Centre | | Miami-Fort Lauderdale-Pompano Beach, FL | 100.0 | % | |
| | 98,950 |
| | Publix | | CVS, Dollar Tree |
| Alafaya Square | | Orlando, FL | | 20.0 | % | | (1)(3) | | 176,341 |
| | Publix | |
|
| Clermont Landing | | Orlando, FL | | 65.1 | % | | (1)(3) | | 339,294 |
| |
| | (J.C. Penney), (Epic Theater), T.J. Maxx, Ross Dress for Less, Michaels |
| Colonial Plaza | | Orlando, FL | | 100.0 | % | |
| | 498,994 |
| |
| | Staples, Ross Dress for Less, Marshalls, Old Navy, Stein Mart, Barnes & Noble, Petco, Big Lots, Hobby Lobby |
| International Drive Value Center | | Orlando, FL | | 20.0 | % | | (1)(3) | | 185,365 |
| |
| | Bed Bath & Beyond, Ross Dress for Less, T.J. Maxx |
| Marketplace at Seminole Towne Center | | Orlando, FL | | 100.0 | % | |
| | 500,607 |
| | (Super Target) | | Marshalls, Ross Dress for Less, Old Navy, Sports Authority, Petco |
| Phillips Crossing | | Orlando, FL | | 100.0 | % | |
| | 145,644 |
| | Whole Foods | | Golf Galaxy, Michaels |
| The Marketplace at Dr. Phillips | | Orlando, FL | | 20.0 | % | | (1)(3) | | 326,090 |
| | Publix | | Stein Mart, Home Goods, Morton's of Chicago, Office Depot |
| The Shoppes at South Semoran | | Orlando, FL | | 100.0 | % | |
| | 101,611 |
| | Walmart Neighborhood Market | | Dollar Tree |
| Winter Park Corners | | Orlando, FL | | 100.0 | % | |
| | 102,382 |
| | Whole Foods Market | | |
| Indian Harbour Place | | Palm Bay-Melbourne et al, FL | | 25.0 | % | | (1)(3) | | 177,471 |
| | Publix | | Bealls |
| Pineapple Commons | | Port St. Lucie-Fort Pierce, FL | | 20.0 | % | | (1)(3) | | 264,468 |
| |
| | Ross Dress for Less, Best Buy, PetSmart, Marshalls, (CVS) |
| Quesada Commons | | Punta Gorda, FL | | 25.0 | % | | (1)(3) | | 58,890 |
| | Publix | | (Walgreens) |
| Shoppes of Port Charlotte | | Punta Gorda, FL | | 25.0 | % | | (1)(3) | | 63,108 |
| | (Publix) | | Petco, (Walgreens) |
| Countryside Centre | | Tampa-St. Petersburg et al, FL | | 100.0 | % | |
| | 248,253 |
| |
| | T.J. Maxx, Home Goods, Dick's Sporting Goods, Ross Dress for Less |
| East Lake Woodlands | | Tampa-St. Petersburg et al, FL | | 20.0 | % | | (1)(3) | | 133,306 |
| | Walmart Neighborhood Market | | Walgreens |
| Largo Mall | | Tampa-St. Petersburg et al, FL | | 100.0 | % | |
| | 574,588 |
| | (Albertsons) | | Bealls, Marshalls, PetSmart, Bed Bath & Beyond, Staples, Michaels, (Target) |
| Palms of Carrollwood | | Tampa-St. Petersburg et al, FL | | 100.0 | % | |
| | 154,118 |
| | The Fresh Market | | Bed Bath & Beyond |
| Sunset 19 | | Tampa-St. Petersburg et al, FL | | 100.0 | % | |
| | 275,910 |
| |
| | Bed Bath & Beyond, Staples, Comp USA, Barnes & Noble, Sports Authority, Old Navy |
| Whole Foods @ Carrollwood | | Tampa-St. Petersburg et al, FL | | 100.0 | % | | (4) | | 36,900 |
| | Whole Foods Market | |
|
| Florida Total: | | | | | | | | 7,470,927 |
| | | | |
| Georgia | | | | | | | | | | | | |
| Brookwood Marketplace | | Atlanta-Sandy Springs et al, GA | | 100.0 | % | |
| | 397,295 |
| | (Super Target) | | Home Depot, Bed Bath & Beyond, Office Max |
| Brookwood Square | | Atlanta-Sandy Springs et al, GA | | 100.0 | % | |
| | 181,333 |
| |
| | Marshalls, LA Fitness |
| Brownsville Commons | | Atlanta-Sandy Springs et al, GA | | 100.0 | % | |
| | 81,886 |
| | (Kroger) | |
|
| Camp Creek Marketplace II | | Atlanta-Sandy Springs et al, GA | | 100.0 | % | |
| | 228,003 |
| |
| | DSW, LA Fitness, Shopper's World, American Signature |
| Dallas Commons | | Atlanta-Sandy Springs et al, GA | | 100.0 | % | |
| | 95,262 |
| | (Kroger) | |
|
| Grayson Commons | | Atlanta-Sandy Springs et al, GA | | 100.0 | % | |
| | 76,611 |
| | Kroger | |
|
|
| | | | | | | | | | | | | | |
| Center | | CBSA (5) | | Owned % | | Foot Notes | | GLA | | Grocer Anchor ( ) indicates owned by others | | Other Anchors ( ) indicates owned by others |
| Lakeside Marketplace | | Atlanta-Sandy Springs et al, GA | | 100.0 | % | |
| | 332,889 |
| | (Super Target) | | Ross Dress for Less, Petco |
| Mansell Crossing | | Atlanta-Sandy Springs et al, GA | | 20.0 | % | | (1)(3) | | 102,931 |
| |
| | buybuy BABY, Ross Dress for Less, Rooms to Go |
| Perimeter Village | | Atlanta-Sandy Springs et al, GA | | 100.0 | % | |
| | 373,621 |
| | Walmart Supercenter | | Cost Plus World Market, DSW, Hobby Lobby |
| Publix at Princeton Lakes | | Atlanta-Sandy Springs et al, GA | | 20.0 | % | | (1)(3) | | 72,207 |
| | Publix | |
|
| Reynolds Crossing | | Atlanta-Sandy Springs et al, GA | | 100.0 | % | |
| | 115,983 |
| | (Kroger) | |
|
| Roswell Corners | | Atlanta-Sandy Springs et al, GA | | 100.0 | % | |
| | 318,387 |
| | (Super Target) | | Staples, T.J. Maxx |
| Roswell Crossing | | Atlanta-Sandy Springs et al, GA | | 100.0 | % | |
| | 201,979 |
| | Trader Joe's | | Office Max, PetSmart, Walgreens |
| Thompson Bridge Commons | | Gainesville, GA | | 100.0 | % | | (4) | | 95,587 |
| | (Kroger) | |
|
| Georgia Total: | | | | | | | | 2,673,974 |
| | | | |
| Kentucky | | | | | | | | | | | | |
| Millpond Center | | Lexington-Fayette, KY | | 100.0 | % | |
| | 151,498 |
| | Kroger | |
|
| Regency Shopping Centre | | Lexington-Fayette, KY | | 100.0 | % | |
| | 188,782 |
| | (Kroger) | | T.J. Maxx, Michaels |
| Tates Creek | | Lexington-Fayette, KY | | 100.0 | % | |
| | 203,532 |
| | Kroger | | Rite Aid |
| Festival at Jefferson Court | | Louisville, KY-IN | | 100.0 | % | |
| | 218,107 |
| | Kroger | | (PetSmart), (TJ Maxx), Staples, Party City |
| Kentucky Total: | | | | | | | | 761,919 |
| | | | |
| Louisiana | | | | | | | | | | | | |
| K-Mart Plaza | | Lake Charles, LA | | 50.0 | % | | (1)(3) | | 225,148 |
| | Albertsons | | Kmart, Dollar Tree, Planet Fitness |
| Southgate | | Lake Charles, LA | | 100.0 | % | |
| | 155,789 |
| | Market Basket | | Office Depot, Books-A-Million |
| Danville Plaza | | Monroe, LA | | 100.0 | % | |
| | 136,368 |
| | County Market | | Citi Trends, Surplus Warehouse |
| Louisiana Total: | | | | | | | | 517,305 |
| | | | |
| Maryland | | | | | | | | | | | | |
| Pike Center | | Washington, DC-VA-MD-WV | | 100.0 | % | |
| | 80,841 |
| |
| | T.G.I. Friday's, Ethan Allen, Pier 1 |
| Maryland Total: | | | | | | | | 80,841 |
| | | | |
| Missouri | | | | | | | | | | | | |
| Western Plaza | | St. Louis, MO-IL | | 50.0 | % | | (1)(3) | | 56,734 |
| |
| | Value Village |
| Missouri Total: | | | | | | | | 56,734 |
| | | | |
| Nevada | | | | | | | | | | | | |
| Best in the West | | Las Vegas-Paradise, NV | | 100.0 | % | |
| | 428,066 |
| |
| | Best Buy, T. J. Maxx, Babies "R" Us, Bed Bath & Beyond, Petsmart, Office Depot |
| Charleston Commons | | Las Vegas-Paradise, NV | | 100.0 | % | |
| | 367,544 |
| | Walmart | | Ross Dress for Less, Office Max, 99 Cents Only, PetSmart |
| College Park S.C. | | Las Vegas-Paradise, NV | | 100.0 | % | |
| | 195,367 |
| | El Super | | Factory 2 U, CVS |
| Decatur 215 | | Las Vegas-Paradise, NV | | 100.0 | % | |
| | 241,700 |
| | (WinCo Foods) | | (Target), Hobby Lobby |
| Eastern Horizon | | Las Vegas-Paradise, NV | | 100.0 | % | |
| | 353,538 |
| | Trader Joe's, (Kmart) | |
|
| Francisco Centre | | Las Vegas-Paradise, NV | | 100.0 | % | |
| | 148,815 |
| | La Bonita Grocery | | (Ross Dress for Less), Fallas Paredes |
| Paradise Marketplace | | Las Vegas-Paradise, NV | | 100.0 | % | |
| | 152,672 |
| | (Smith’s Food) | | Dollar Tree |
| Rainbow Plaza | | Las Vegas-Paradise, NV | | 100.0 | % | |
| | 273,916 |
| | Albertsons | | Ross Dress for Less, JC Penney, Home Depot, 24 Hour Fitness |
| Rainbow Plaza, Phase I | | Las Vegas-Paradise, NV | | 100.0 | % | |
| | 136,339 |
| | Albertsons | | Ross Dress for Less, JC Penney, Home Depot, 24 Hour Fitness |
| Rancho Towne & Country | | Las Vegas-Paradise, NV | | 100.0 | % | |
| | 161,837 |
| | Smith’s Food | |
|
| Tropicana Beltway | | Las Vegas-Paradise, NV | | 100.0 | % | |
| | 617,821 |
| | (Walmart Supercenter) | | (Lowe’s), Ross Dress for Less, PetSmart, Office Depot, Sports Authority |
| Tropicana Marketplace | | Las Vegas-Paradise, NV | | 100.0 | % | | | | 142,643 |
| | (Smith’s Food) | | Family Dollar |
| Westland Fair North | | Las Vegas-Paradise, NV | | 100.0 | % | |
| | 598,213 |
| | (Walmart Supercenter) | | (Lowe’s), PetSmart, Office Depot, Michaels, Anna's Linens |
| Nevada Total: | | | | | | | | 3,818,471 |
| | | | |
| New Mexico | | | | | | | | | | | | |
| Eastdale | | Albuquerque, NM | | 100.0 | % | |
| | 119,091 |
| | Albertsons | | Family Dollar |
| North Towne Plaza | | Albuquerque, NM | | 100.0 | % | |
| | 139,996 |
| | Whole Foods Market | | Home Goods |
| New Mexico Total: | | | | | | | | 259,087 |
| | | | |
| North Carolina | | | | | | | | | | | | |
| Galleria | | Charlotte-Gastonia et al, NC-SC | | 100.0 | % | |
| | 328,276 |
| | (Walmart Supercenter) | | Off Broadway Shoes |
| Whitehall Commons | | Charlotte-Gastonia et al, NC-SC | | 100.0 | % | |
| | 444,803 |
| | (Walmart Supercenter), (Publix) | | (Lowe's) |
| Bull City Market | | Durham, NC | | 100.0 | % | |
| | 40,875 |
| | Whole Foods Market | |
|
| Chatham Crossing | | Durham, NC | | 25.0 | % | | (1)(3) | | 96,155 |
| | Lowes Foods | | CVS |
| Hope Valley Commons | | Durham, NC | | 100.0 | % | |
| | 81,371 |
| | Harris Teeter | |
|
| Avent Ferry | | Raleigh-Cary, NC | | 100.0 | % | |
| | 119,652 |
| | Food Lion | | Family Dollar |
| Capital Square | | Raleigh-Cary, NC | | 100.0 | % | |
| | 143,063 |
| | Food Lion | |
|
| Falls Pointe | | Raleigh-Cary, NC | | 100.0 | % | |
| | 198,549 |
| | Harris Teeter | | (Kohl’s) |
| High House Crossing | | Raleigh-Cary, NC | | 100.0 | % | |
| | 90,155 |
| | Harris Teeter | |
|
|
| | | | | | | | | | | | | | |
| Center | | CBSA (5) | | Owned % | | Foot Notes | | GLA | | Grocer Anchor ( ) indicates owned by others | | Other Anchors ( ) indicates owned by others |
| Leesville Town Centre | | Raleigh-Cary, NC | | 100.0 | % | |
| | 127,106 |
| | Harris Teeter | | Rite Aid |
| Northwoods Market | | Raleigh-Cary, NC | | 100.0 | % | |
| | 77,802 |
| | Walmart Neighborhood Market | | Dollar Tree |
| Six Forks Station | | Raleigh-Cary, NC | | 100.0 | % | |
| | 467,660 |
| | Food Lion | | Kmart, Home Depot, Bed Bath & Beyond, PetSmart |
| Stonehenge Market | | Raleigh-Cary, NC | | 100.0 | % | |
| | 188,437 |
| | Harris Teeter | | Stein Mart, Rite Aid |
| Surf City Crossing | | Wilmington, NC | | 100.0 | % | |
| | 63,016 |
| | Harris Teeter | |
|
| Waterford Village | | Wilmington, NC | | 100.0 | % | |
| | 89,483 |
| | Harris Teeter | |
|
| North Carolina Total: | | | | | | | | 2,556,403 |
| | | | |
| Oklahoma | | | | | | | | | | | | |
| Town and Country | | Oklahoma City, OK | | 100.0 | % | |
| | 128,231 |
| |
| | Big Lots, Westlake Hardware, Aaron Rents |
| Oklahoma Total: | | | | | | | | 128,231 |
| | | | |
| Oregon | | | | | | | | | | | | |
| Clackamas Square | | Portland-Vancouver et al, OR-WA | | 20.0 | % | | (1)(3) | | 140,227 |
| | (Winco Foods) | | T.J. Maxx |
| Oak Grove Market Center | | Portland-Vancouver et al, OR-WA | | 100.0 | % | |
| | 97,177 |
| | Safeway | |
|
| Raleigh Hills Plaza | | Portland-Vancouver et al, OR-WA | | 20.0 | % | | (1)(3) | | 39,520 |
| | New Seasons Market | | Walgreens |
| Oregon Total: | | | | | | | | 276,924 |
| | | | |
| South Carolina | | | | | | | | | | | | |
| Fresh Market Shoppes | | Hilton Head Island-Beaufort, SC | | 25.0 | % | | (1)(3) | | 86,694 |
| | The Fresh Market | | Dollar Tree |
| South Carolina Total: | | | | | | | | 86,694 |
| | | | |
| Tennessee | | | | | | | | | | | | |
| Bartlett Towne Center | | Memphis, TN-MS-AR | | 100.0 | % | |
| | 192,624 |
| | Kroger | | Petco, Dollar Tree, Shoe Carnival |
| Commons at Dexter Lake | | Memphis, TN-MS-AR | | 100.0 | % | |
| | 178,558 |
| | Kroger | | Stein Mart, Marshalls, HomeGoods |
| Commons at Dexter Lake Phase II | | Memphis, TN-MS-AR | | 100.0 | % | |
| | 66,838 |
| | Kroger | | Stein Mart, Marshalls, HomeGoods |
| Highland Square | | Memphis, TN-MS-AR | | 100.0 | % | | (4) | | 14,490 |
| |
| | Walgreens |
| Mendenhall Commons | | Memphis, TN-MS-AR | | 100.0 | % | |
| | 88,108 |
| | Kroger | |
|
| Ridgeway Trace | | Memphis, TN-MS-AR | | 100.0 | % | |
| | 307,727 |
| |
| | (Target), Best Buy, Sports Authority, PetSmart |
| Tennessee Total: | | | | | | | | 848,345 |
| | | | |
| Texas | | | | | | | | | | | | |
| Bell Plaza | | Amarillo, TX | | 15.0 | % | | (1) | | 130,631 |
| | United Supermarket | | Dollar Tree |
| Mueller Regional Retail Center | | Austin-Round Rock-San Marcos, TX | 100.0 | % | |
| | 351,099 |
| |
| | Marshalls, PetSmart, Bed Bath & Beyond, Home Depot, Best Buy |
| North Park Plaza | | Beaumont-Port Arthur, TX | | 50.0 | % | | (1)(3) | | 302,460 |
| |
| | (Target), (Toys “R” Us), Anna's Linens, Spec's, Kirkland's |
| North Towne Plaza | | Brownsville-Harlingen, TX | | 100.0 | % | |
| | 153,000 |
| |
| | (Lowe's) |
| Moore Plaza | | Corpus Christi, TX | | 100.0 | % | |
| | 599,622 |
| | (H-E-B) | | Office Depot, Marshalls, (Target), Old Navy, Hobby Lobby, Stein Mart |
| Boswell Towne Center | | Dallas-Fort Worth-Arlington, TX | | 100.0 | % | |
| | 88,008 |
| | (Albertsons) | |
|
| Gateway Station | | Dallas-Fort Worth-Arlington, TX | | 70.0 | % | | (1) | | 68,360 |
| |
| | Conn's |
| Lake Pointe Market Center | | Dallas-Fort Worth-Arlington, TX | | 100.0 | % | |
| | 121,689 |
| | (Tom Thumb) | | (Walgreens) |
| Overton Park Plaza | | Dallas-Fort Worth-Arlington, TX | | 100.0 | % | |
| | 463,431 |
| | Sprouts Farmers Market | | Sports Authority, PetSmart, T.J. Maxx, (Home Depot), Goody Goody Wines, Anna’s Linens, buybuy BABY |
| Preston Shepard Place | | Dallas-Fort Worth-Arlington, TX | | 20.0 | % | | (1)(3) | | 361,832 |
| |
| | Babies "R" Us, Stein Mart, Nordstrom, Marshalls, Office Depot, Petco |
| 10/Federal | | Houston-Baytown-Sugar Land, TX | | 15.0 | % | | (1) | | 132,472 |
| | Sellers Bros. | | Palais Royal, Harbor Freight Tools |
| 1919 North Loop West | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 138,058 |
| |
| | State of Texas |
| Alabama-Shepherd | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 59,120 |
| | Trader Joe's | | PetSmart |
| Bellaire Boulevard | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 41,273 |
| | Randall’s | |
|
| Blalock Market at I-10 | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 97,277 |
| | 99 Ranch Market | |
|
| Braeswood Square | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 104,778 |
| | Belden’s | | Walgreens |
| Broadway | | Houston-Baytown-Sugar Land, TX | | 15.0 | % | | (1) | | 74,604 |
| |
| | Big Lots, Family Dollar |
| Centre at Post Oak | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 183,940 |
| |
| | Marshalls, Old Navy, Grand Lux Café, Nordstrom Rack, Arhaus |
| Citadel Plaza | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 121,000 |
| |
| | Weingarten Realty Investors Corporate Office |
| Cullen Plaza | | Houston-Baytown-Sugar Land, TX | | 15.0 | % | | (1) | | 84,517 |
| | Fiesta | | Family Dollar |
| Cypress Pointe | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 283,381 |
| | Kroger | | Babies “R” Us |
| Fiesta Village | | Houston-Baytown-Sugar Land, TX | | 15.0 | % | | (1) | | 30,249 |
| | Fiesta | |
|
| Galveston Place | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 210,370 |
| | Randall’s | | Office Depot, Palais Royal, Spec's |
| Glenbrook Square | | Houston-Baytown-Sugar Land, TX | | 15.0 | % | | (1) | | 77,890 |
| | Kroger | |
|
| Griggs Road | | Houston-Baytown-Sugar Land, TX | | 15.0 | % | | (1) | | 80,116 |
| |
| | Family Dollar, Citi Trends |
| Harrisburg Plaza | | Houston-Baytown-Sugar Land, TX | | 15.0 | % | | (1) | | 93,438 |
| |
| | Fallas Paredes |
| HEB - Dairy Ashford & Memorial | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | | (4) | | 36,874 |
| | H-E-B | |
|
|
| | | | | | | | | | | | | | |
| Center | | CBSA (5) | | Owned % | | Foot Notes | | GLA | | Grocer Anchor ( ) indicates owned by others | | Other Anchors ( ) indicates owned by others |
| Heights Plaza | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 71,277 |
| | Kroger | |
|
| Humblewood Shopping Plaza | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 279,226 |
| |
| | Conn’s, Walgreens, (Michaels), (DSW) |
| I-45/Telephone Rd. Center | | Houston-Baytown-Sugar Land, TX | | 15.0 | % | | (1) | | 171,599 |
| | Sellers Bros. | | Famsa, Dollar Tree, Fallas Paredes |
| Lawndale | | Houston-Baytown-Sugar Land, TX | | 15.0 | % | | (1) | | 52,127 |
| |
| | LaMichoacana Meat Market, Family Dollar, 99 Cents Only |
| League City Plaza | | Houston-Baytown-Sugar Land, TX | | 15.0 | % | | (1) | | 126,990 |
| | Kroger | |
|
| Little York Plaza | | Houston-Baytown-Sugar Land, TX | | 15.0 | % | | (1) | | 113,878 |
| | Sellers Bros. | | Fallas Paredes |
| Lyons Avenue | | Houston-Baytown-Sugar Land, TX | | 15.0 | % | | (1) | | 67,629 |
| | Fiesta | | Fallas Paredes |
| Market at Town Center | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 388,865 |
| |
| | Old Navy, Home Goods, Marshalls, Ross Dress for Less, Nordstrom Rack, Saks Fifth Avenue OFF 5TH |
| Market at Westchase | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 84,084 |
| | Whole Foods Market | |
|
| Northbrook Center | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 173,288 |
| | Randall’s | | Office Depot, Citi Trends, Anna’s Linens, Dollar Tree |
| Oak Forest | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 151,324 |
| | Kroger | | Ross Dress for Less, Dollar Tree, Petsmart |
| Palmer Plaza | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 195,231 |
| |
| | Dollar Tree |
| Randall's/Kings Crossing | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 126,397 |
| | Randall’s | | CVS |
| Richmond Square | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 92,356 |
| |
| | Best Buy, Cost Plus |
| River Oaks East | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 71,265 |
| | Kroger | |
|
| River Oaks West | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 247,673 |
| | Kroger | | Barnes & Noble, Talbots, Ann Taylor, Gap, JoS. A. Bank |
| Shoppes at Memorial Villages | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 184,354 |
| |
| | Rexel |
| Shops at Kirby Drive | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 10,000 |
| |
| | Freebirds Burrito |
| Shops at Three Corners | | Houston-Baytown-Sugar Land, TX | | 70.0 | % | | (1) | | 277,871 |
| | Fiesta | | Ross Dress for Less, PetSmart, Office Depot, Big Lots |
| Southgate | | Houston-Baytown-Sugar Land, TX | | 15.0 | % | | (1) | | 125,260 |
| | Food-A-Rama | | CVS, Family Dollar, Palais Royal |
| Stella Link | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 70,087 |
| | Sellers Bros. | | Spec’s |
| Tomball Marketplace | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 298,857 |
| |
| | (Academy), (Kohl's), Ross Dress For Less, Marshalls |
| Village Plaza at Bunker Hill | | Houston-Baytown-Sugar Land, TX | | 57.8 | % | | (1)(3) | | 490,734 |
| | H-E-B | | PetSmart, Babies "R" Us, Academy, Nordstrom Rack |
| Westchase Center | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 360,793 |
| | Whole Foods Market | | (Target), Ross Dress for Less, Golfsmith, Palais Royal, Petco |
| Westhill Village | | Houston-Baytown-Sugar Land, TX | | 100.0 | % | |
| | 128,791 |
| |
| | Ross Dress for Less, Office Depot, 99 Cents Only, Anna’s Linens |
| Independence Plaza | | Laredo, TX | | 100.0 | % | |
| | 347,302 |
| | H-E-B | | TJ Maxx, Ross, Hobby Lobby, Petco, Ulta Beauty |
| North Creek Plaza | | Laredo, TX | | 100.0 | % | |
| | 485,463 |
| | (H-E-B) | | (Target), Marshalls, Old Navy, Best Buy, Bed Bath & Beyond |
| Plantation Centre | | Laredo, TX | | 100.0 | % | |
| | 143,015 |
| | H-E-B | |
|
| Las Tiendas Plaza | | McAllen-Edinburg-Pharr, TX | | 50.0 | % | | (1)(3) | | 500,067 |
| |
| | (Target), Academy, Conn’s, Ross Dress for Less, Marshalls, Office Depot |
| Market at Nolana | | McAllen-Edinburg-Pharr, TX | | 50.0 | % | | (1)(3) | | 243,821 |
| | (Walmart Supercenter) | |
|
| Market at Sharyland Place | | McAllen-Edinburg-Pharr, TX | | 50.0 | % | | (1)(3) | | 301,174 |
| | (Walmart Supercenter) | | Kohl's, Dollar Tree |
| Northcross | | McAllen-Edinburg-Pharr, TX | | 50.0 | % | | (1)(3) | | 74,865 |
| |
| | Barnes & Noble |
| Old Navy Building | | McAllen-Edinburg-Pharr, TX | | 50.0 | % | | (1)(3)(4) | | 15,000 |
| |
| | Old Navy |
| Sharyland Towne Crossing | | McAllen-Edinburg-Pharr, TX | | 50.0 | % | | (1)(3) | | 484,949 |
| | H-E-B | | (Target), T.J. Maxx, Petco, Office Depot, Ross Dress for Less |
| South 10th St. HEB | | McAllen-Edinburg-Pharr, TX | | 50.0 | % | | (1)(3) | | 103,702 |
| | H-E-B | |
|
| Starr Plaza | | Rio Grande City, TX | | 50.0 | % | | (1)(3) | | 176,693 |
| | H-E-B | | Bealls |
| Fiesta Trails | | San Antonio, TX | | 100.0 | % | |
| | 482,370 |
| | (H-E-B) | | (Target), Act III Theatres, Marshalls, Office Max, Stein Mart, Petco, Anna’s Linens |
| Parliament Square II | | San Antonio, TX | | 100.0 | % | | (4) | | 54,541 |
| |
| | Incredible Pizza |
| Thousand Oaks | | San Antonio, TX | | 15.0 | % | | (1) | | 162,009 |
| | H-E-B | | Bealls, Tuesday Morning |
| Valley View | | San Antonio, TX | | 100.0 | % | |
| | 91,544 |
| |
| | Marshalls, Dollar Tree |
| Broadway | | Tyler, TX | | 100.0 | % | |
| | 60,447 |
| |
| | Stein Mart |
| Texas Total: | | | | | | | | 12,576,407 |
| | | | |
| Utah | | | | | | | | | | | | |
| DDS Office Building | | Salt Lake City, UT | | 100.0 | % | |
| | 27,300 |
| |
| |
|
| Taylorsville Town Center | | Salt Lake City, UT | | 100.0 | % | |
| | 139,007 |
| | The Fresh Market | | Rite Aid |
| West Jordan Town Center | | Salt Lake City, UT | | 100.0 | % | |
| | 304,899 |
| |
| | (Target), Petco |
| Utah Total: | | | | | | | | 471,206 |
| | | | |
| Washington | | | | | | | | | | | | |
| Meridian Town Center | | Seattle-Tacoma-Bellevue, WA | | 20.0 | % | | (1)(3) | | 143,012 |
| | (Safeway) | | Jo-Ann Fabric & Craft Store, Tuesday Morning |
| Promenade 23 | | Seattle-Tacoma-Bellevue, WA | | 100.0 | % | |
| | 96,860 |
| | Red Apple Grocers | | Walgreens |
| Queen Anne Marketplace | | Seattle-Tacoma-Bellevue, WA | | 51.0 | % | | (1)(3) | | 81,385 |
| | Metropolitan Market | | Bartell's Drug |
| Rainer Square Plaza | | Seattle-Tacoma-Bellevue, WA | | 20.0 | % | | (1)(3) | | 108,356 |
| | Safeway | | Ross Dress for Less |
|
| | | | | | | | | | | | | | |
| Center | | CBSA (5) | | Owned % | | Foot Notes | | GLA | | Grocer Anchor ( ) indicates owned by others | | Other Anchors ( ) indicates owned by others |
| South Hill Center | | Seattle-Tacoma-Bellevue, WA | | 20.0 | % | | (1)(3) | | 134,010 |
| |
| | Bed Bath & Beyond, Ross Dress for Less, Best Buy |
| Washington Total: | | | | | | | | 563,623 |
| | | | |
| Total Operating Properties | | | | | | | | 45,064,945 |
| | | | |
| New Development | | | | | | | | | | |
| Maryland | | | | | | | | | | | | |
| Nottingham Commons | | Baltimore-Towson, MD | | 100.0 | % | | (2) | | 2,209 |
| | | | |
| Maryland Total: | | | | | | | | 2,209 |
| | | | |
| North Carolina | | | | | | | | | | | | |
| Wake Forest Crossing II | | Raleigh-Cary, NC | | 100.0 | % | | (2) | | 93,595 |
| | | | |
| North Carolina Total: | | | | | | | | 93,595 |
| | | | |
| Virginia | | | | | | | | | | | | |
| Hilltop Village | | Washington, DC-VA-MD-WV | | 50.0 | % | | (1)(2) | | 130,876 |
| | | | |
| Virginia Total: | | | | | | | | 130,876 |
| | | | |
| Total New Developments | | | | | | 226,680 |
| | | | |
___________________
ITEM 3. | Legal Proceedings |
| (1) | Denotes property is held by a real estate joint venture or partnership; however, the gross leasable area square feet figures include our partners’ ownership interest in the property and property owned by others. |
| |
| (2) | Denotes property currently under development. |
| |
| (3) | Denotes properties that are not consolidated under generally accepted accounting principles. |
| |
| (4) | Denotes single tenant property. |
| |
| (5) | CBSA represents the Core Based Statistical Area. |
ITEM 3. Legal Proceedings
We are involved in various matters of litigation arising in the normal course of business. While we are unable to predict
with certainty the amounts involved, our management and
legal counsel believe that when such litigation is resolved, our resulting liability, if any, will not have a material
adverse effect on our consolidated financial statements.
ITEM 4. | Mine Safety Disclosures |
ITEM 4. Mine Safety Disclosures
ITEM 5. Market for Registrant’s Common Shares of Beneficial Interest, Related Shareholder Matters and Issuer Purchases of Equity Securities
Our common shares are listed and traded on the New York Stock Exchange under the symbol “WRI.” As of January 31, 2012,2015, the number of holders of record of our common shares was 2,433.2,012. The closing high and low sale prices per common share as reported on the New York Stock Exchange, and dividends per share paid for the fiscal quarters indicated were as follows: | | | | | | | | | | | | |
| | | High | | | Low | | | Dividends | |
| | | |
2011: | | | | | | | | | | | | |
Fourth | | $ | 23.95 | | | $ | 19.35 | | | $ | .275 | |
Third | | | 26.73 | | | | 19.39 | | | | .275 | |
Second | | | 26.80 | | | | 23.64 | | | | .275 | |
First | | | 25.87 | | | | 23.69 | | | | .275 | |
| | | |
2010: | | | | | | | | | | | | |
Fourth | | $ | 25.92 | | | $ | 21.92 | | | $ | .260 | |
Third | | | 22.70 | | | | 18.34 | | | | .260 | |
Second | | | 23.93 | | | | 18.71 | | | | .260 | |
First | | | 22.95 | | | | 18.16 | | | | .260 | |
|
| | | | | | | | | | | | |
| | High | | Low | | Dividends | |
| 2014: | | | | | | |
| Fourth | $ | 36.96 |
| | $ | 31.79 |
| | $ | .575 |
| (1) |
| Third | 34.47 |
| | 31.28 |
| | .325 |
| |
| Second | 32.86 |
| | 30.13 |
| | .325 |
| |
| First | 31.09 |
| | 27.75 |
| | .325 |
| |
| 2013: | | | | | | |
| Fourth | $ | 32.44 |
| | $ | 27.42 |
| | $ | .305 |
| |
| Third | 32.69 |
| | 27.54 |
| | .305 |
| |
| Second | 35.84 |
| | 28.79 |
| | .305 |
| |
| First | 31.55 |
| | 27.35 |
| | .305 |
| |
___________________
| |
| (1) | Comprised of a regular dividend of $.325 per common share and a special dividend of $.25 per common share. |
The following table summarizes the equity compensation plans under which our common shares may be issued as of December 31, 2011: | | | | | | |
Plan category | | Number of shares to
be issued upon exercise
of outstanding options,
warrants and rights | | Weighted average
exercise price of
outstanding options,
warrants and rights | | Number of shares
remaining available
for future issuance |
| | | |
Equity compensation plans approved by shareholders | | 4,607,703 | | $ 28.09 | | 2,144,215 |
| | | |
Equity compensation plans not approved by shareholders | | — | | — | | — |
| | | | | | |
| | | |
Total | | 4,607,703 | | $ 28.09 | | 2,144,215 |
| | | | | | |
2014
: |
| | | | | | |
| Plan category | | Number of shares to be issued upon exercise of outstanding options, warrants and rights | | Weighted average exercise price of outstanding options, warrants and rights | | Number of shares remaining available for future issuance |
| Equity compensation plans approved by shareholders | | 2,897,123 | | $28.76 | | 1,437,633 |
| Equity compensation plans not approved by shareholders | | — | | — | | — |
| Total | | 2,897,123 | | $28.76 | | 1,437,633 |
The graph and table below provides an indicator of cumulative total shareholder returns for us as compared with the S&P 500 Stock Index and the FTSE NAREIT All Equity Shopping Centers Index, weighted by market value at each measurement point. The graph assumes that on December 31, 2006,2009, $100 was invested in our common shares and that all dividends were reinvested by the shareholder. Comparison of Five Year Cumulative Return
| | | | | | | | | | | | | | | | | | | | |
| | | 2007 | | | 2008 | | | 2009 | | | 2010 | | | 2011 | |
| | | | | |
Weingarten | | $ | 71.52 | | | $ | 51.26 | | | $ | 53.91 | | | $ | 67.98 | | | $ | 65.37 | |
S&P 500 Index | | | 105.49 | | | | 66.46 | | | | 84.05 | | | | 96.71 | | | | 98.75 | |
The NAREIT All Equity Index | | | 84.31 | | | | 52.50 | | | | 67.20 | | | | 85.98 | | | | 93.11 | |
*$100 invested on December 31, 2009 in stock or index, including reinvestment of dividends.
Fiscal year ending December 31.
Source: SNL Financial LC
|
| | | | | | | | | | | | | | | | | | | |
| | 2010 | | 2011 | | 2012 | | 2013 | | 2014 |
| Weingarten Realty Investors | $ | 126.10 |
| | $ | 121.27 |
| | $ | 155.50 |
| | $ | 165.96 |
| | $ | 221.43 |
|
| S&P 500 Index | 115.06 |
| | 117.49 |
| | 136.30 |
| | 180.44 |
| | 205.14 |
|
| FTSE NAREIT Equity Shopping Centers Index | 130.78 |
| | 129.83 |
| | 162.31 |
| | 170.41 |
| | 221.47 |
|
There can be no assurance that our share performance will continue into the future with the same or similar trends depicted in the graph above. We do not make or endorse any predications as to future share performance.
ITEM 6. Selected Financial Data
The following table sets forth our selected consolidated financial data and should be read in conjunction with “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the Consolidated Financial Statements and accompanying Notes in “Item 8. Financial Statements and Supplementary Data” and the financial schedules included elsewhere in this Form 10-K.
| | | | | | | | | | | | | | | | | | | | |
| | | (Amounts in thousands, except per share amounts) | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | | | 2008 | | | 2007 | |
Operating Data: (1) | | | | | | | | | | | | | | | | | | | | |
Revenues (primarily real estate rentals) | | $ | 541,561 | | | $ | 535,084 | | | $ | 552,226 | | | $ | 572,376 | | | $ | 542,912 | |
Depreciation and Amortization | | | 152,983 | | | | 145,893 | | | | 142,549 | | | | 145,414 | | | | 118,635 | |
Impairment Loss | | | 58,734 | | | | 33,317 | | | | 34,983 | | | | 52,539 | | | | - | |
Operating Income | | | 138,416 | | | | 167,206 | | | | 181,887 | | | | 171,192 | | | | 239,145 | |
Interest Expense, net | | | 141,757 | | | | 148,152 | | | | 152,041 | | | | 155,020 | | | | 154,858 | |
(Loss) Gain on Redemption of Convertible Senior Unsecured Notes | | | - | | | | (135 | ) | | | 25,311 | | | | 12,961 | | | | - | |
Gain on Land and Merchant Development Sales | | | - | | | | - | | | | 18,688 | | | | 8,407 | | | | 16,385 | |
(Provision) Benefit for Income Taxes | | | (395 | ) | | | (180 | ) | | | (6,269 | ) | | | 10,288 | | | | (4,073 | ) |
Income from Continuing Operations | | | 9,160 | | | | 41,453 | | | | 84,549 | | | | 64,336 | | | | 124,886 | |
Gain on Sale of Property | | | 1,737 | | | | 2,005 | | | | 25,266 | | | | 1,998 | | | | 4,086 | |
Net Income | | | 16,739 | | | | 51,238 | | | | 175,276 | | | | 154,595 | | | | 240,338 | |
Net Income Adjusted for Noncontrolling Interests | | | 15,621 | | | | 46,206 | | | | 171,102 | | | | 145,652 | | | | 230,101 | |
Net (Loss) Income Attributable to Common Shareholders | | $ | (19,855 | ) | | $ | 10,730 | | | $ | 135,626 | | | $ | 109,091 | | | $ | 204,726 | |
| | | | | |
Per Share Data - Basic: | | | | | | | | | | | | | | | | | | | | |
(Loss) Income from Continuing Operations Attributable to Common Shareholders | | $ | (0.21 | ) | | $ | 0.02 | | | $ | 0.64 | | | $ | 0.25 | | | $ | 1.09 | |
Net (Loss) Income Attributable to Common Shareholders | | $ | (0.17 | ) | | $ | 0.09 | | | $ | 1.24 | | | $ | 1.29 | | | $ | 2.39 | |
Weighted Average Number of Shares | | | 120,331 | | | | 119,935 | | | | 109,546 | | | | 84,474 | | | | 85,504 | |
| | | | | |
Per Share Data - Diluted: | | | | | | | | | | | | | | | | | | | | |
(Loss) Income from Continuing Operations Attributable to Common Shareholders | | $ | (0.21 | ) | | $ | 0.02 | | | $ | 0.64 | | | $ | 0.24 | | | $ | 1.09 | |
Net (Loss) Income Attributable to Common Shareholders | | $ | (0.17 | ) | | $ | 0.09 | | | $ | 1.23 | | | $ | 1.28 | | | $ | 2.35 | |
Weighted Average Number of Shares | | | 120,331 | | | | 120,780 | | | | 110,178 | | | | 84,917 | | | | 88,893 | |
| | | | | |
Balance Sheet Data: | | | | | | | | | | | | | | | | | | | | |
Property (at cost) | | $ | 4,688,526 | | | $ | 4,777,794 | | | $ | 4,658,396 | | | $ | 4,915,472 | | | $ | 4,972,344 | |
Total Assets | | | 4,588,226 | | | | 4,807,855 | | | | 4,890,385 | | | | 5,114,212 | | | | 4,992,636 | |
Debt, net | | $ | 2,531,837 | | | $ | 2,589,448 | | | $ | 2,531,847 | | | $ | 3,148,636 | | | $ | 3,131,977 | |
| | | | | |
Other Data: | | | | | | | | | | | | | | | | | | | | |
Cash Flows from Operating Activities | | $ | 214,731 | | | $ | 214,625 | | | $ | 244,316 | | | $ | 220,150 | | | $ | 223,309 | |
Cash Flows from Investing Activities | | | (3,745 | ) | | | (121,421 | ) | | | 191,872 | | | | (115,391 | ) | | | (480,630 | ) |
Cash Flows from Financing Activities | | | (221,203 | ) | | | (222,929 | ) | | | (341,550 | ) | | | (111,590 | ) | | | 252,095 | |
Cash Dividends per Common Share | | | 1.10 | | | | 1.04 | | | | 1.28 | | | | 2.10 | | | | 1.98 | |
Funds from Operations - Basic (2) | | $ | 173,325 | | | $ | 187,008 | | | $ | 204,634 | | | $ | 194,633 | | | $ | 243,827 | |
|
| | | | | | | | | | | | | | | | | | | |
| | (Amounts in thousands, except per share amounts) Year Ended December 31, |
| | 2014 | | 2013 | | 2012 | | 2011 | | 2010 |
Operating Data: (1) | | | | | | | | | |
| Revenues (primarily real estate rentals) | $ | 514,406 |
| | $ | 489,195 |
| | $ | 451,177 |
| | $ | 428,294 |
| | $ | 418,904 |
|
| Depreciation and Amortization | 150,356 |
| | 146,763 |
| | 127,703 |
| | 118,890 |
| | 113,161 |
|
| Impairment Loss | 1,024 |
| | 2,579 |
| | 9,585 |
| | 49,671 |
| | 33,317 |
|
| Operating Income | 182,038 |
| | 159,868 |
| | 144,361 |
| | 103,314 |
| | 117,922 |
|
| Interest Expense, net | 94,725 |
| | 96,312 |
| | 106,248 |
| | 130,298 |
| | 135,484 |
|
Gain on Sale and Acquisition of Real Estate Joint Venture and Partnership Interests | 1,718 |
| | 33,670 |
| | 14,203 |
| | — |
| | — |
|
Equity in Earnings (Losses) of Real Estate Joint Ventures and Partnerships, net | 22,317 |
| | 35,112 |
| | (1,558 | ) | | 7,834 |
| | 12,889 |
|
| Benefit (Provision) for Income Taxes | 1,261 |
| | (7,046 | ) | | 75 |
| | 3 |
| | 297 |
|
| Income (Loss) from Continuing Operations | 116,365 |
| | 132,977 |
| | 56,880 |
| | (14,088 | ) | | 5,307 |
|
| Gain on Sale of Property | 146,290 |
| | 762 |
| | 1,004 |
| | 1,304 |
| | 2,005 |
|
| Net Income | 307,579 |
| | 265,156 |
| | 152,421 |
| | 16,739 |
| | 51,238 |
|
| Net Income Adjusted for Noncontrolling Interests | 288,008 |
| | 220,262 |
| | 146,640 |
| | 15,621 |
| | 46,206 |
|
Net Income (Loss) Attributable to Common Shareholders | $ | 277,168 |
| | $ | 184,145 |
| | $ | 109,210 |
| | $ | (19,855 | ) | | $ | 10,730 |
|
| Per Share Data - Basic: | | | | | | | | | |
Income (Loss) from Continuing Operations Attributable to Common Shareholders | $ | 1.91 |
| | $ | 0.76 |
| | $ | 0.13 |
| | $ | (0.40 | ) | | $ | (0.27 | ) |
Net Income (Loss) Attributable to Common Shareholders | $ | 2.28 |
| | $ | 1.52 |
| | $ | 0.90 |
| | $ | (0.17 | ) | | $ | 0.09 |
|
| Weighted Average Number of Shares | 121,542 |
| | 121,269 |
| | 120,696 |
| | 120,331 |
| | 119,935 |
|
| Per Share Data - Diluted: | | | | | | | | | |
Income (Loss) from Continuing Operations Attributable to Common Shareholders | $ | 1.89 |
| | $ | 0.75 |
| | $ | 0.13 |
| | $ | (0.40 | ) | | $ | (0.27 | ) |
Net Income (Loss) Attributable to Common Shareholders | $ | 2.25 |
| | $ | 1.50 |
| | $ | 0.90 |
| | $ | (0.17 | ) | | $ | 0.09 |
|
| Weighted Average Number of Shares - Diluted | 124,370 |
| | 122,460 |
| | 121,705 |
| | 120,331 |
| | 119,935 |
|
| Balance Sheet Data: | | | | | | | | | |
| Property (at cost) | $ | 4,076,094 |
| | $ | 4,289,276 |
| | $ | 4,399,850 |
| | $ | 4,688,526 |
| | $ | 4,777,794 |
|
| Total Assets | 3,814,094 |
| | 4,223,929 |
| | 4,184,784 |
| | 4,588,226 |
| | 4,807,855 |
|
| Debt, net | $ | 1,938,188 |
| | $ | 2,299,844 |
| | $ | 2,204,030 |
| | $ | 2,531,837 |
| | $ | 2,589,448 |
|
| Other Data: | | | | | | | | | |
| Cash Flows from Operating Activities | $ | 240,769 |
| | $ | 233,992 |
| | $ | 227,330 |
| | $ | 214,731 |
| | $ | 214,625 |
|
| Cash Flows from Investing Activities | 218,077 |
| | 134,654 |
| | 370,308 |
| | (3,745 | ) | | (121,421 | ) |
| Cash Flows from Financing Activities | (527,233 | ) | | (296,674 | ) | | (591,676 | ) | | (221,203 | ) | | (222,929 | ) |
| Cash Dividends per Common Share | 1.55 |
| | 1.22 |
| | 1.16 |
| | 1.10 |
| | 1.04 |
|
Funds from Operations - Basic (2) | $ | 254,518 |
| | $ | 222,732 |
| | $ | 222,128 |
| | $ | 173,325 |
| | $ | 187,008 |
|
___________________
| |
| (1) | For all periods presented, the operating data related to continuing operations and gain on sale of property do not include the effects of amounts reported in discontinued operations. Also, for the year ended December 31, 2011operations, and 2010, certain business combination transactions have occurred. See Note 15 and Note 23 respectively, to our consolidated financial statements in Item 8 for additional information. |
| |
| (2) | TheSee Item 7 for the National Association of Real Estate Investment Trusts definesdefinition of funds from operations as net income (loss) attributable to common shareholders computed in accordance with generally accepted accounting principles, excluding gains or losses from sales of operating real estate assets and extraordinary items, plus depreciation and amortization of operating properties and impairment of depreciable real estate, including our share of unconsolidated real estate joint ventures and partnerships. See Item 7 for additional information.
operations. |
ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion should be read in conjunction with the consolidated financial statements and notes thereto and the comparative summary of selected financial data appearing elsewhere in this report. Historical results and trends which might appear should not be taken as indicative of future operations. Our results of operations and financial condition, as reflected in the accompanying consolidated financial statements and related footnotes, are subject to management’s evaluation and interpretation of business conditions, retailer performance, changing capital market conditions and other factors which could affect the ongoing viability of our tenants.
Weingarten Realty Investors is a REIT organized under the Texas Business Organizations Code. We, and our predecessor entity, began the ownership and development of shopping centers and other commercial real estate in 1948. Our primary business is leasing space to tenants in the shopping
and industrial centers we own or lease. We also
manage centersprovide property management services for
which we charge fees to either joint ventures
in whichwhere we are partners or
for other outside
owners for which we charge fees.owners.
We operate a portfolio of rental properties,
which includesprimarily neighborhood and community shopping centers,
and industrial properties that totaltotaling approximately
76.145.3 million square
feet.feet of gross leasable area, that is either owned by us or others. We have a diversified tenant base with our largest tenant comprising only
3.2%3.5% of
totalbase minimum rental revenues during
2011.Our long-term strategy is to focus on improving our core operations and increasing shareholder value. We accomplish this through hands-on leasing and management, selective redevelopment of the existing portfolio of properties, disciplined growth from strategic acquisitions and new developments, as well as dispositions of assets that no longer meet our ownership criteria. We remain committed to maintaining a conservatively leveraged balance sheet, a well-staggered debt maturity schedule and strong credit agency ratings.
During 2011, we announced our intentions to dispose of over $600 million of non-core operating properties over the next few years, which will recycle capital for growth opportunities, strengthen our operating fundamentals and allow for further deleveraging of our balance sheet. In the course of executing this disposition plan, given proper pricing, we will consider selling both retail and industrial properties. To date, we have successfully disposed of $155.6 million, either directly or through our interest in real estate joint ventures or partnerships, and have approximately $76.9 million currently under contracts or letters of intent. Upon the completion of this program, we believe our remaining portfolio of properties will be among the strongest in our sector.
Improvements in the economy earlier in 2011 reopened markets to create more favorable pricing for dispositions. However, the federal debt ceiling crisis and volatility in Greece and other European markets have resulted in deteriorated market conditions and access to the CMBS debt markets for potential purchasers. Despite these conditions, we continue to believe we will successfully execute our disposition plan; although continued weakness in the CMBS debt markets and further worsening of the economy could impact our ability to execute this plan. Nonetheless, competition for quality acquisition opportunities remains substantial. During 2011, we were successful in identifying selected properties that met our return hurdles, and we will continue to actively evaluate other opportunities as they enter the market.
We strive to maintain a strong, conservative capital structure which provides ready access to a variety of attractive long and short-term capital sources. We carefully balance obtaining low cost financing while matching long-term liabilities associated with acquired or developed long-term assets. An amendment and extension of our revolving credit facility during 2011 enhances our liquidity for the next four years and provides favorable borrowing rates at a margin over LIBOR. While the availability of capital has improved over the past year, there can be no assurance that such pricing and availability will not deteriorate in the future.
2014.
At December 31,
2011,2014, we owned or operated under long-term leases, either directly or through our interest in real estate joint ventures or partnerships, a total of
380234 developed income-producing properties and
11three properties under
various stages of construction and development. The total number of centers includes 313 neighborhood and community shopping centers, 75 industrial projects and three other operating propertiesdevelopment, which are located in
2321 states spanning the country from coast to coast.
We also owned interests in
4034 parcels of land held for development that totaled approximately
30.025.3 million square
feet.feet at December 31, 2014.
We had approximately
7,5005,800 leases with
5,2003,800 different tenants at December 31,
2011.2014. Leases for our properties range from less than a year for smaller spaces to over 25 years for larger tenants. Rental revenues generally include minimum lease payments, which often increase over the lease term, reimbursements of property operating expenses, including real estate taxes, and additional rent payments based on a percentage of the tenants’ sales. The majority of ourOur anchor tenants are supermarkets, value-oriented apparel/discount stores and other retailers or service providers who generally sell basic necessity-type goods and services. Through this challenging economic environment, weWe believe the stability of our anchor tenants, combined with convenient locations, attractive and well-maintained properties, high quality retailers and a strong tenant mix, should ensure the long-term success of our merchants and the viability of our portfolio.
Our goal is to remain a leader in owning and operating top-tier neighborhood and community shopping centers in certain markets of the U.S. We have completed the transformation of our portfolio outlined in 2011 by disposing non-core properties and reinvesting in high-quality centers supported by stronger demographics. Our strategic initiatives have now turned to: (1) raising net asset value and cash flow through quality acquisitions, redevelopments and new developments, (2) maintaining a strong, flexible consolidated balance sheet and a well-managed debt maturity schedule and (3) growing net operating income from our existing portfolio by increasing occupancy and rental rates. We believe these initiatives will keep our portfolio of properties among the strongest in our sector.
Under our capital recycling plan, we disposed of non-core operating properties, which provided capital for growth opportunities and strengthened our operating fundamentals. During 2014, we successfully disposed of real estate assets with our share of aggregate gross sales proceeds totaling $387 million, which were owned by us either directly or through our interest in real estate joint ventures or partnerships. Although the transformation process is complete, we will continue to recycle properties that no longer meet our ownership criteria with the magnitude of these dispositions significantly reduced when compared to activity over the past several years. We expect to complete dispositions in the range of $125 million to $175 million in 2015, but we can give no assurances that this will actually occur. We have approximately $63 million of dispositions currently under contracts or letters of intent; however, there are no assurances that these transactions will close. Subsequent to year-end, we sold two properties with gross proceeds totaling $25 million.
As we are generally selling lower-tier, non-core assets, potential buyers requiring financing for such acquisitions may find access to capital an issue, especially if long-term interest rates rise, but conditions are currently very good. We intend to continue to recycle capital according to our business plan, although a number of factors, including weaknesses in the secured lending markets or a downturn in the economy, could adversely impact our ability to execute this plan.
We continue to actively seek acquisitions opportunities to grow our operations. Despite substantial competition for quality opportunities, we will continue to identify select acquisition properties that meet our return hurdles and to actively evaluate other opportunities as they enter the market. In 2014, we acquired a center in Arizona with a gross purchase price of $43.8 million. For 2015, we expect to invest in acquisitions in the range of $200 million to $250 million, but we can give no assurances that this will actually occur. Subsequent to year-end, we acquired one center in Texas with a gross purchase price of $43.1 million.
We continue to focus on identifying new development projects as another source of growth. Although we have only seen a few viable projects, a lack of supply in new retail space, combined with an increase in supermarket sales, has driven an increase in new development activity and retailer interest, which we believe is a positive trend. During 2014, we acquired two new development properties located in North Carolina and Maryland, with our expected investment in these properties to be approximately $62 million. Furthermore, we have a contractual commitment to purchase the retail portion of a mixed-use project in Washington from its developer, and our expected investment in this mixed-use project approximates $29 million. For 2015, we expect to invest in new developments in the range of $50 million to $100 million, but we can give no assurances that this will actually occur.
In addition, we continue to look for internal growth opportunities. Currently, we have 13 redevelopment projects in which we plan to invest approximately $67 million over the next 24 months. Additionally, in 2014 we completed one redevelopment project in a 50% unconsolidated real estate joint venture, which has added approximately 7,200 incremental square feet to to the total portfolio, with our share of the incremental investment totaling $.6 million. Upon completion, the average projected stabilized return on our incremental investment on these redevelopment projects is expected to range between 10% to 15%.
We strive to maintain a strong, conservative capital structure which should provide ready access to a variety of attractive long and short-term capital sources. We carefully balance lower cost short-term financing with long-term liabilities associated with acquired or developed long-term assets. During 2014, we repaid $315 million of medium term notes from the net proceeds of our $250 million issuance in October 2013 of 4.45% senior unsecured notes that had been previously invested in short-term investments of $50 million and cash and cash equivalents. Furthermore, in 2014, we redeemed the total outstanding principal amount of $100 million of our 8.1% senior unsecured notes, which was funded through our revolving credit facility. These transactions have decreased our interest costs by replacing high-cost debt with considerably lower rate debt.
We believe that these transactions should continue to strengthen our consolidated balance sheet and further enhance our access to various sources of capital, while reducing our cost of capital. While the availability of capital has improved over the past few years, there can be no assurance that favorable pricing and availability will not deteriorate in the future. The transformation of our operating portfolio and the continued strengthening of our consolidated balance sheet has been rewarded with a change in outlook to Positive from Stable by Moody’s Investor Services during 2014.
Operational Metrics
In assessing the performance of our properties,centers, management carefully monitors various operating metrics of the portfolio. OccupancyAs a result of our transformation initiative, strong leasing activity, low tenant fallout and lack of quality retail space in the market, the operating metrics of our portfolio strengthened in 2014 as we focused on increasing occupancy and same property net operating income ("SPNOI" and see Non-GAAP Financial Measures for additional information). Our portfolio delivered solid operating results with:
improved occupancy to 95.4% for the total portfolio increased from 91.9% atyear ended December 31, 2010 to 92.1% at2014 over the same period of 2013 of 94.8%;
an increase of 3.4% in SPNOI for the year ended December 31, 2011. 2014 over the same period of 2013; and
rental rate increases of 13.1% for new leases and 9.3% for renewals during 2014.
Below are performance metrics associated with our signed occupancy, SPNOI growth and leasing activity on a pro rata basis:
|
| | | | | |
| | December 31, |
| | 2014 | | 2013 |
| Anchor (space of 10,000 square feet or greater) | 98.9 | % | | 98.5 | % |
| Non-Anchor (small shop) | 89.8 | % | | 89.0 | % |
| Total Occupancy | 95.4 | % | | 94.8 | % |
|
| | | | | |
| | Three Months Ended
December 31, 2014 | | Twelve Months Ended
December 31, 2014 |
SPNOI Growth (1) | 3.6 | % | | 3.4 | % |
___________________
| |
| (1) | See Non-GAAP Financial Measures for a definition of the measurement of SPNOI and a reconciliation to operating income within this section of Item 7. |
|
| | | | | | | | | | | | | | | | | | | | |
| | Number of Leases | | Square Feet ('000's) | | Average New Rent per Square Foot ($) | | Average Prior Rent per Square Foot ($) | | Average Cost of Tenant Improvements per Square Foot ($) | | Change in Base Rent on Cash Basis |
| Leasing Activity: | | | | | | | | | | | |
| Three Months Ended December 31, 2014 | | | | | | |
New leases (1) | 54 |
| | 134 |
| | $ | 19.46 |
| | $ | 17.63 |
| | $ | 12.33 |
| | 10.4 | % |
| Renewals | 186 |
| | 682 |
| | 15.07 |
| | 13.53 |
| | 0.06 |
| | 11.4 | % |
| Not comparable spaces | 43 |
| | 162 |
| | — |
| | — |
| | — |
| | — | % |
| Total | 283 |
| | 978 |
| | $ | 15.79 |
| | $ | 14.20 |
| | $ | 2.07 |
| | 11.2 | % |
| | | | | | | | | | | | |
| Twelve Months Ended December 31, 2014 | | | | | | |
New leases (1) | 236 |
| | 690 |
| | $ | 18.95 |
| | $ | 16.76 |
| | $ | 21.70 |
| | 13.1 | % |
| Renewals | 737 |
| | 2,737 |
| | 15.52 |
| | 14.20 |
| | 0.03 |
| | 9.3 | % |
| Not comparable spaces | 187 |
| | 700 |
| | — |
| | — |
| | — |
| | — | % |
| Total | 1,160 |
| | 4,127 |
| | $ | 16.21 |
| | $ | 14.72 |
| | $ | 4.39 |
| | 10.1 | % |
___________________
| |
| (1) | Average external lease commissions per square foot for the three and twelve months ended December 31, 2014 were$4.18 and $4.58, respectively. |
While we will continue to monitor the economy and the effects on our tenants,
over the long-term we believe the significant diversification of our portfolio, both geographically and by tenant base, and the quality of our portfolio will allow us to
maintainfurther increase occupancy levels
at or above these levelsslightly; however, occupancy may oscillate over the next several quarters as we
move through 2012, assuming no bankruptciescontinue to maximize our long-term portfolio value by
multiple national or regional tenants. Soft economic conditionsrepositioning some of our anchor space. A reduction in quality retail space available contributed to
a slight decreasethe increase in
overall rental rates on a same-space basis as we completed new leases and renewed existing leases.
We completed 1,762 new leases or renewals during 2011, totaling 7.1 million square feet, which decreased rental rates anLeasing volume is anticipated to decline as we have less vacant space available for leasing. Our expectation is that SPNOI will average
of .4% on a cash basis. While we continuebetween 2.5% to
see some strengthening in our renewal rates, new lease rates continue to be a challenge. Although we believe the gap in the new lease rate margins will not continue to widen, they are expected to remain a challenge throughout 2012.3.5% for 2015.
At December 31,
2011,2014, we had
11 properties in various stages of construction and development, including three newly acquiredfour projects
located in Florida, Georgia and Virginia, which upon completion will represent an estimated total investment of $74.4 million.under development. We have funded
$143.3$82.8 million to date on these
11 projects, and we estimate our
aggregate net investment upon completion to be
$193.7 million, after consideration of proceeds from anticipated land sales and tax incentive financing which is estimated to be $24.6$156.6 million. Overall, the average projected
stabilized return on investment for these properties is
expected to be approximately
7.2%7.7% upon
projected completion.
In November, we formed a real estate joint venture to develop a shopping center in Alexandria, Virginia. This development will include 258,000 square feet of retail space and is anchored by a 140,000 square foot supermarket. This project will represent an investment of
We had approximately
$61.6 million upon completion and provides us with our entry into the dynamic Washington, D.C. market.We have approximately $124.5$103.3 million in land held for development at December 31, 2011. Due to our analysis of current economic considerations, including the effects of recent market transactions and negotiations with potential buyers, we recognized an impairment charge of $23.6 million for the year ended December 31, 2011. Even with the unrest in the overall economy, we continue to see an increase in development and redevelopment opportunities entering the market, which2014. While we are selectively pursuing. Within this portfolio, we have experiencedexperiencing a greater levels of interest compared to recent yearsfrom retailers and other market participants in our land held for development, from retailersopportunities for economically viable developments remain scarce. We intend to continue to pursue additional development and other market participants. Also, certain tracts of land have been designated for transition to land under development as additional phases of existing developments become feasible.
redevelopment opportunities in multiple markets; however, finding the right opportunities remains challenging.
Acquisitions and Joint Ventures
Acquisitions are a key component of our long-term
growth strategy. The availability of quality acquisition opportunities in the market remains
sporadic. Competition forsporadic in our targeted markets. Intense competition, along with a decline in the
highest qualityvolume of high-quality core properties
is intense whichon the market, has in many cases driven pricing to pre-recession highs. We remain disciplined in approaching these opportunities, pursuing only those that provide appropriate risk-adjusted returns.
The use
Table of joint venture arrangements is another facet of our long-term strategy. Partnering with institutional investors through real estate joint ventures enables us to acquire high quality assets in our target markets while also meeting our financial return objectives. Under these arrangements, we benefit from access to lower-cost capital, as well as leveraging our expertise to provide fee-based services, such as acquisition, leasing, property management and asset management, to the joint ventures.An analysis of our equity method investments in real estate joint ventures and partnerships resulted in an impairment charge of $1.8 million for the year ended December 31, 2011 based on current market conditions. We continue to monitor our joint venture relationships and evaluate whether new or existing relationships could provide equity for new investments.
Fee income from joint venture and third party managed operations for the year ended December 31, 2011, 2010 and 2009 was approximately $6.7 million, $7.0 million and $6.3 million, respectively. This fee income is based upon revenues, net income and in some cases appraised property values. In 2012, we anticipate these fees will be consistent with our 2011 performance.
Contents
Dispositions are also a key component of our ongoing management process where we selectively prune properties from our portfolio that no longer meet our geographic or growth targets. Dispositions provide capital, which may be recycled into properties that
haveare high barrier-to-entry locations within high growth metropolitan markets, and thus have higher long-term growth potential. Additionally, proceeds from dispositions may be used to reduce outstanding debt, further deleveraging our
consolidated balance sheet.
Over time, we expect this will produce a portfolio with higher occupancy rates and stronger internal revenue growth. During 2011, we announced a strategic initiative to dispose of over $600 million of non-core operating properties over the next few years. In the course of executing this disposition plan, given proper pricing, we will consider selling both retail and industrial properties.Our disposition program may be impacted by market pricing conditions and debt financing available to prospective purchasers. After specifically identifying potential disposition properties and analyzing current market data, we recognized an impairment charge of $31.7 million for the year ended December 31, 2011 on the properties we believe we are likely to sell as part of this initiative or properties that have been sold during 2011.
Summary of Critical Accounting Policies
Our discussion and analysis of financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities and contingencies as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. We evaluate our assumptions and estimates on an ongoing basis. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We believe the following critical accounting policies require more significant judgments and estimates used in the preparation of our consolidated financial statements.
Real Estate Joint Ventures and Partnerships
To determine the method of accounting for partially owned real estate joint ventures and partnerships, management evaluates the characteristics of associated entities and determines whether an entity is a variable interest entity (“VIE”) and, if so, determines which party is the primary beneficiary by analyzing whether we have both the power to direct the entity’s significant economic activities and the obligation to absorb potentially significant losses or receive potentially significant benefits. Significant judgments and assumptions inherent in this analysis include the nature of the entity’s operations, future cash flow projections, the entity’s financing and capital structure, and contractual relationships and terms. We consolidate a VIE when we have determined that we are the primary beneficiary.
Primary risks associated with our VIEs include the potential of funding the entities’ debt obligations or making additional contributions to fund the entities’ operations.
Partially owned, non variable interest real estate joint ventures and partnerships over which we have a controlling financial interest are consolidated in our consolidated financial statements. In determining if we have a controlling financial interest, we consider factors such as ownership interest, authority to make decisions, kick-out rights and substantive participating rights. Partially owned real estate joint ventures and partnerships where we do not have a controlling financial interest, but have the ability to exercise significant influence, are accounted for using the equity method.
Management continually analyzes and assesses reconsideration events, including changes in the factors mentioned above, to determine if the consolidation treatment remains appropriate. Decisions regarding consolidation of partially owned entities frequently require significant judgment by our management. Errors in the assessment of consolidation could result in material changes to our consolidated financial statements.
Acquisitions of properties are accounted for utilizing the acquisition method and, accordingly, the results of operations of an acquired property are included in our results of operations from the date of acquisition. Estimates of fair values are based upon future cash flows and other valuation techniques in accordance with our fair value measurements accounting policy. Fair values are used to record the purchase price of acquired property among land, buildings on an “as if vacant” basis, tenant improvements, other identifiable intangibles and any goodwill or gain on purchase. Other identifiable intangible assets and liabilities include the effect of out-of-market leases, the value of having leases in place (“as is” versus “as if vacant” and absorption costs), out-of-market assumed mortgages and tenant relationships. Depreciation and amortization is computed using the straight-line method, generally over estimated useful lives of 40 years for buildings and over the lease term which includes bargain renewal options for other identifiable intangible assets. The impact of these estimates, including incorrect estimates in connection with acquisition values and estimated useful lives, could result in significant differences related to the purchased assets, liabilities and resulting depreciation or amortization. Acquisition costs are expensed as incurred.
Real Estate Joint Ventures and Partnerships
To determine the method of accounting for partially owned real estate joint ventures and partnerships, management evaluates the characteristics of associated entities and determines whether an entity is a variable interest entity (“VIE”) and, if so, determines which party is the primary beneficiary by analyzing whether we have both the power to direct the entity’s significant economic activities and the obligation to absorb potentially significant losses or receive potentially significant benefits. Significant judgments and assumptions inherent in this analysis include the design of the entity structure, the nature of the entity’s operations, future cash flow projections, the entity’s financing and capital structure, and contractual relationships and terms. We consolidate a VIE when we have determined that we are the primary beneficiary.
Primary risks associated with our VIEs include the potential funding of the entities’ debt obligations or making additional contributions to fund the entities’ operations.
Partially owned, non-variable interest real estate joint ventures and partnerships over which we have a controlling financial interest are consolidated in our consolidated financial statements. In determining whether we have a controlling financial interest, we consider factors such as ownership interest, authority to make decisions, kick-out rights and substantive participating rights. Partially owned real estate joint ventures and partnerships where we do not have a controlling financial interest, but have the ability to exercise significant influence, are accounted for using the equity method.
Management continually analyzes and assesses reconsideration events, including changes in the factors mentioned above, to determine if the consolidation treatment remains appropriate. Decisions regarding consolidation of partially owned entities frequently require significant judgment by our management. Errors in the assessment of consolidation could result in material changes to our consolidated financial statements.
Our property is reviewed for impairment if events or changes in circumstances indicate that the carrying amount of the property, including any capitalized costs and any identifiable intangible assets, may not be recoverable.
If such an event occurs, a comparison is made of the current and projected operating cash flows of each such property into the foreseeable future, with consideration of applicable holding periods, on an undiscounted basis to the carrying amount of such property. If we determine the carrying amount is not recoverable, our basis in the property is reduced to its estimated fair value to reflect impairment in the value of the asset. Fair values are determined by management utilizing cash flow models, market capitalization and discount rates, or by obtaining third-party broker or appraisal estimates in accordance with our fair value measurements accounting policy.
We review current economic considerations each reporting period, including the effects of tenant bankruptcies, the suspension of tenant expansion plans for new development projects, declines in real estate values and any changes to plans related to our new development projects including land held for development, to identify properties where we believe market values may be deteriorating. Determining whether a property is impaired and, if impaired, the amount of write-down to fair value requires a significant amount of judgment by management and is based on the best information available to management at the time of evaluation. The evaluations used in these analyses could result in incorrect estimates when determining carrying values that could be material to our consolidated financial statements.
Our investment in partially owned real estate joint ventures and partnerships is reviewed for impairment each reporting period. The ultimate realization is dependent on a number of factors, including the performance of each investment and market conditions. We will record an impairment charge if we determine that a decline in the estimated fair value of an investment below its carrying amount is other than temporary. A considerable amount of judgment by our management is used in this evaluation. Our overall future plans for the investment, our investment partner’s financial outlook and our views on current market and economic conditions may have a significant impact on the resulting factors analyzed for these purposes.
Our investments in tax increment revenue bonds are reviewed for impairment, including the evaluation of changes in events or circumstances that may indicate that the carrying amount of the investment may not be recoverable. Realization is dependent on a number of factors, including investment performance, market conditions and payment structure. We will record an impairment charge if we determine that a decline in the value of the investment below its carrying amount is other than temporary, recovery of its cost basis is uncertain, and/or it is uncertain if the investment will be held to maturity. A considerable amount of judgment by our management is used in this evaluation, which may produce incorrect estimates that could be material to our consolidated financial statements.
Comparison of the Year Ended December 31, 20112014 to the Year Ended December 31, 20102013 The following table is a summary of certain items from our Consolidated Statements of Operations, which we believe represent items that significantly changed during 2014 as compared to the same period in 2013:
|
| | | | | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | Change | | % Change |
| Revenues | $ | 514,406 |
| | $ | 489,195 |
| | $ | 25,211 |
| | 5.2 | % |
| Interest expense, net | 94,725 |
| | 96,312 |
| | (1,587 | ) | | (1.6 | ) |
| Interest and other income, net | 3,756 |
| | 7,685 |
| | (3,929 | ) | | (51.1 | ) |
Gain on sale and acquisition of real estate joint
venture and partnership interests | 1,718 |
| | 33,670 |
| | (31,952 | ) | | (94.9 | ) |
Equity in earnings of real estate joint
ventures and partnerships, net | 22,317 |
| | 35,112 |
| | (12,795 | ) | | (36.4 | ) |
| Benefit (provision) for income taxes | 1,261 |
| | (7,046 | ) | | 8,307 |
| | 117.9 |
|
The increase in revenues
were $541.6of $25.2 million
for the year ended 2011 versus $535.1 million for the year ended 2010, an increase of $6.5 million or 1.2%. This increase is
primarily attributable to an increase in net rental revenues
of $5.2from acquisitions and new development completions, which contributed $18.7 million,
associated primarily with the acquisition of six properties in the latter half of 2010 and two properties in 2011, as well as
new development completions.Depreciationincreases in occupancy and Amortization
Depreciation and amortization for the year ended 2011 was $153.0 million versus $145.9 million for the year ended 2010, an increase of $7.1 million or 4.9%. This increaserental rates, which is primarily attributable to the acquisition of six propertiesoffset by our dispositions in the latter halfthird and fourth quarters of 2010 and two properties in 2011, new development completions and other capital activities.
Real Estate Taxes, net
Net real estate taxes for the year ended 2011 were $64.2 million versus $61.5 million for the year ended 2010, an increase2014.
Net interest expense totaled $141.8 million for 2011, down $6.4decreased $1.6 million or 4.3% from 2010.1.6%. The components of net interest expense were as follows (in thousands): | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | |
| | |
Gross interest expense | | $ | 144,913 | | | $ | 152,165 | |
Amortization of convertible bond discount | | | 1,334 | | | | 2,191 | |
Over-market mortgage adjustment | | | (2,161) | | | | (2,799) | |
Capitalized interest | | | (2,329) | | | | (3,405) | |
| | | | | | | | |
| | |
Total | | $ | 141,757 | | | $ | 148,152 | |
| | | | | | | | |
|
| | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 |
| Gross interest expense | $ | 98,973 |
| | $ | 108,333 |
|
| Over-market mortgage adjustment | (946 | ) | | (9,618 | ) |
| Capitalized interest | (3,302 | ) | | (2,403 | ) |
| Total | $ | 94,725 |
| | $ | 96,312 |
|
Gross interest expense totaled
$144.9$99.0 million in
2011,2014, down
$7.3$9.4 million or
4.8%8.6% from
2010.2013. The decrease in gross interest expense
was dueis primarily
attributable to
thea reduction in
both the weighted average debt outstanding and interest rates as a result of
amending and extending our revolving credit facility and refinancingthe repayment of notes
and mortgages through the revolving credit
facility.facility, disposition proceeds and short-term investments from the October 2013 note issuance, all of which totaled $11.6 million. In
2011,2014, the weighted average debt outstanding was
$2.6$2.08 billion at a weighted average interest rate of
5.6%4.65% as compared to
$2.5$2.14 billion outstanding at a weighted average interest rate of
6.1%5.06% in
2010. Capitalized interest decreased $1.12013. Offsetting this decrease is a $1.2 million
aswrite-off of debt costs in 2014 associated with the redemption of the 8.1% senior unsecured notes. The decrease in the over-market mortgage adjustment of $8.7 million is primarily attributable to a
result$9.7 million write-off in 2013 of
new development stabilizations and completions.an above-market mortgage intangible from the early payoff of the associated mortgage.
Interest and Other Income, net
Net
The decrease of $3.9 million is attributable primarily a $2.0 million decrease in the fair value of assets held in a grantor trust related to our deferred compensation plan and the repayment of various notes receivable.
Gain on Sale and Acquisition of Real Estate Joint Venture and Partnership Interests
The decrease of $32.0 million is attributable to the gains in 2013 associated with the liquidation of an unconsolidated real estate joint venture that owned industrial properties of $11.5 million and the acquisition of an unconsolidated real estate joint venture interest totaling $20.2 million.
Equity in Earnings of Real Estate Joint Ventures and other income for the year ended 2011 was $5.1Partnerships, net
The decrease of $12.8 million versus $9.8 million for the year ended 2010,is primarily attributable to a decrease in the gain on sales from the 2014 and 2013 dispositions, of $4.7which our share totaled $11.0 million or 48.0%. and the purchase of a 50% equity interest in December 2013.
Benefit (Provision) for Income Taxes
The decreaseincrease of $8.3 million is primarily attributable to the tax effect of the gain in 2013 associated with the purchase of a 50% unconsolidated joint venture interest by our taxable REIT subsidiary.
Comparison of the Year Ended December 31, 2013 to the Year Ended December 31, 2012
The following table is a summary of certain items from our Consolidated Statements of Operations, which we believe represent items that significantly changed during 2013 as compared to the same period in 2012:
|
| | | | | | | | | | | | | | |
| | Year Ended December 31, |
| | 2013 | | 2012 | | Change | | % Change |
| Revenues | $ | 489,195 |
| | $ | 451,177 |
| | $ | 38,018 |
| | 8.4 | % |
| Depreciation and amortization | 146,763 |
| | 127,703 |
| | 19,060 |
| | 14.9 |
|
| Operating expenses | 97,099 |
| | 88,924 |
| | 8,175 |
| | 9.2 |
|
| Real estate taxes, net | 57,515 |
| | 52,066 |
| | 5,449 |
| | 10.5 |
|
| Impairment loss | 2,579 |
| | 9,585 |
| | (7,006 | ) | | (73.1 | ) |
| General and administrative expenses | 25,371 |
| | 28,538 |
| | (3,167 | ) | | (11.1 | ) |
| Interest expense, net | 96,312 |
| | 106,248 |
| | (9,936 | ) | | (9.4 | ) |
Gain on sale and acquisition of real estate joint
venture and partnership interests | 33,670 |
| | 14,203 |
| | 19,467 |
| | 137.1 |
|
Equity in earnings (losses) of real estate joint
ventures and partnerships, net | 35,112 |
| | (1,558 | ) | | 36,670 |
| | 2,353.7 |
|
| (Provision) benefit for income taxes | (7,046 | ) | | 75 |
| | (7,121 | ) | | (9,494.7 | ) |
Revenues
The increase in revenues of $38.0 million is primarily attributable to an increase in net rental revenues of $37.3 million due primarily to increases in occupancy and rental rates, new development completions of $2.4 million and acquisitions of $18.7 million.
Depreciation and Amortization
The increase of $19.1 million is primarily attributable to acquisitions, new development completions and other capital activities.
Operating Expenses
The increase in operating expenses of $8.2 million is primarily attributable to acquisitions, which totaled $2.7 million, an increase in management fees of $2.1 million primarily attributable to a fair value decrease of $1.5 millionincrease in the assets held in a grantor trust related to our deferred compensation plan of $1.1 million and a decline of $.8 millionslight increase in interest earned on notes receivable fromother operating expenses at our existing properties.
Real Estate Taxes, net
The increase in real estate joint venturestaxes, net of $5.4 million is primarily attributable to rate and partnershipsvaluation changes, as well as acquisitions and new development completions.
Impairment Loss
The decrease in impairment loss of $7.0 million is primarily attributable to the $6.6 million loss in 2012 associated primarily with the consolidation of twoan equity interest in an unconsolidated real estate joint ventures,venture that owned industrial properties.
General and
a $1.9 million reduction in interest associated with our investment in subordinated tax increment revenue bonds.Equity in Earnings of Real Estate Joint Ventures and Partnerships, net
Net equity in earnings of real estate joint ventures and partnerships for the year ended 2011 was $7.8 million versus $12.9 million for the year ended 2010, a decrease of $5.1 million or 39.5%. Administrative Expenses
The decrease
in general and administrative expenses of $3.2 million is primarily attributable to
an increasea reduction in
impairment losses in 2011, associated primarily with reduced holding periods at finite life joint ventures, which is offset by earnings from our 57.8% investment in a shopping center acquired in the fourth quarter of 2010.Comparison of the Year Ended December 31, 2010personnel due to the Year Ended December 31, 2009
Revenues
Total revenues were $535.1 million for the year ended 2010 versus $552.2 million for the year ended 2009,attrition and property dispositions and a decrease of $17.1 million or 3.1%. This decrease is attributable to decreases in net rental revenues and other income of $13.0 million and $4.1 million, respectively. The decrease in net rental revenues was primarily attributable to an aggregate $17.9 million reduction from the sale of an 80% interest in six shopping centers. Offsetting this decline is rentals associated primarily with new development completions and the acquisition of six properties. The decrease in other revenues results primarily from a decline in lease cancellation revenue.
Real Estate Taxes, net
Net real estate taxes for the year ended 2010 were $61.5 million versus $67.3 million for the year ended 2009, a decrease of $5.8 million or 8.6%. The decrease resulted primarily from the sale of an 80% interest in six shopping centers and rate and valuation changes from the prior year.
Impairment Loss
The impairment loss in 2010 is attributable to a $15.8 million lossshare-based compensation associated with the requirement to record our equity interests in two previously unconsolidated real estate joint ventures (of which both are related to the same shopping center) at their estimated fair values in accounting for the consolidationretirement eligible employees.
Net interest expense totaled $148.2 million for 2010, down $3.9decreased $9.9 million or 2.6% from 2009.9.4%. The components of net interest expense were as follows (in thousands): | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2010 | | | 2009 | |
| | |
Gross interest expense | | $ | 152,165 | | | $ | 159,745 | |
Amortization of convertible bond discount | | | 2,191 | | | | 4,969 | |
Over-market mortgage adjustment | | | (2,799) | | | | (3,957) | |
Capitalized interest | | | (3,405) | | | | (8,716) | |
| | | | | | | | |
| | |
Total | | $ | 148,152 | | | $ | 152,041 | |
| | | | | | | | |
|
| | | | | | | |
| | Year Ended December 31, |
| | 2013 | | 2012 |
| Gross interest expense | $ | 108,333 |
| | $ | 111,673 |
|
| Over-market mortgage adjustment | (9,618 | ) | | (2,300 | ) |
| Capitalized interest | (2,403 | ) | | (3,125 | ) |
| Total | $ | 96,312 |
| | $ | 106,248 |
|
Gross interest expense totaled $152.2$108.3 million in 2010,2013, down $7.6$3.3 million or 4.7%3.0% from 2009.2012. The decrease in gross interest expense was dueresults primarily to thefrom a reduction in both the weighted average debt outstanding resulting from the retirementand interest rates as a result of the convertiblerefinancing of notes and other unsecured debt.mortgages with proceeds from dispositions and note issuances. In 2010,2013, the weighted average debt outstanding was $2.5$2.14 billion at a weighted effectiveaverage interest rate of 6.1%5.06% as compared to $2.8$2.18 billion of outstanding weighted average debt at a weighted effectiveaverage interest rate of 5.8%5.12% in 2009.2012. The decrease of $2.8 millionincrease in the amortization of convertible bond discount relates to the retirement of the convertible notes. The decrease in over-market mortgage adjustment of acquired$7.3 million is attributable to the write-off of net above-market mortgage intangibles associated with the early payoff of the related mortgage in both 2013 and 2012.
Gain on Sale and Acquisition of Real Estate Joint Venture and Partnership Interests
The gain in 2013 is attributable to the liquidation of an unconsolidated real estate joint venture that owned industrial properties of
$1.2$11.5 million,
resulted primarily fromthe acquisition of an unconsolidated real estate joint venture interest totaling $20.2 million and the sale of an
80%interest in four unconsolidated real estate joint ventures of $1.9 million, while the gain in 2012 was associated with the sale of an interest in six
shopping centers and loan payoffs that occurred in 2010 and 2009. Capitalized interest decreased $5.3 million as a result of new development stabilizations, completions and the cessation of carrying costs capitalization on several new development projects transferred to land held for development.(Loss) Gain on Redemption of Convertible Senior Unsecured Notes
The loss in 2010 of $.1 million resulted from the purchase and cancellation of $4.0 million of our 3.95% convertible senior unsecured notes at a premium to par value as compared to the gain of $25.3 million from the purchase and cancellation of $402.0 million of our 3.95% convertible senior unsecured notes at a discount to par value in 2009.
unconsolidated real estate joint ventures.
Equity in Earnings
(Losses) of Real Estate Joint Ventures and Partnerships, net
The increase
in net equity earnings of
real estate joint ventures and partnerships of $7.3$36.7 million
or 132.3% is
primarily attributable to
the gain on sale from 2013 dispositions, of which our share totaled $16.0 million and our share of impairment losses
in 2009 of $6.8 million associated with three new development properties with a minimal impairment loss recorded in
2010 associated with a single property.Gain on Land and Merchant Development Sales
2012, which totaled $19.9 million.
(Provision) Benefit for Income Taxes
The decrease
in gain on land and merchant development sales of
$18.7$7.1 million is primarily attributable to the
gainstax effect of the gain in
2009 that did not reoccur in 2010.Provision for Income Taxes
The decrease in2013 associated with the income tax provisionpurchase of $6.1 million is attributable primarily to a $5.0 million impairment valuation allowance provision in 2009 at50% unconsolidated joint venture interest by our taxable REIT subsidiary.
Gain on Sale of Property
The decrease in gain on sale of property of $23.3 million is attributable primarily to gains in 2009 from the sale of an 80% interest in four shopping centers and the disposition of 11 retail buildings at seven operating properties. The sales activities in 2010 were not significant.
We have structured our leases in such a way as to remain largely unaffected should significant inflation occur. Most of the leases contain percentage rent provisions whereby we receive increased rentals based on the tenants’ gross sales. Many leases provide for increasing minimum
rentalsrental rates during the terms of the leases through escalation provisions. In addition, many of our leases are for terms of less than 10 years,
which allowallowing us to adjust rental rates to changing market conditions when the leases expire. Most of our leases also require the tenants to pay their proportionate share of operating expenses and real estate taxes. As a result of these lease provisions, increases
in operating expenses due to inflation, as well as real estate tax rate increases, generally do not have a significant adverse effect upon our operating results as they are absorbed by our tenants. Under the current economic climate, little to no inflation is occurring.
Economic Conditions
Underlying economic fundamentals continue to show positive, albeit slow, gains as the economic recovery continues to stabilize. Consumer confidence continues to fluctuate, although it is generally positive as oil prices decline and the labor market improves. Furthermore, personal income and housing prices are continuing to increase in our primary markets. We believe there is a direct correlation between housing wealth and consumption, and we expect rebounding home prices will further strengthen retail fundamentals, including rent growth and net operating income. Our focus on supermarket-anchored centers in densely populated major metropolitan areas should position our portfolio to capitalize on the improving retail landscape.
With respect to Houston and other markets that are energy dependent, the reduction in oil prices will likely have a negative impact on the local economy and depending upon the duration of the low oil price environment, could impact the performance of our centers. However, our transformation strategy resulted in the sale of most of our lower quality assets in Houston and other energy dependent markets, which we believe reduces the potential negative impact of the low oil prices to us.
As strengthening retail fundamentals drive demand for investments in top-tier retail real estate, we continue to dedicate internal resources to identify and evaluate available assets in our markets so that we may purchase the best assets and properties with the strongest upside potential. Also, we continue to look for redevelopment opportunities within our existing portfolio by repositioning our anchor tenants and new development opportunities to spur growth.
Capital Resources and Liquidity
Our primary
operating liquidity needs are paying our common and preferred dividends, maintaining and operating our existing properties, paying our debt service costs, excluding debt maturities, and funding capital expenditures. Under our
20122015 business plan, cash flows from operating activities are expected to meet these planned capital needs.
The primary sources of capital for funding any debt maturities,
acquisitions and
acquisitionsnew development are our
revolvingexcess cash flow generated by our operating properties; credit
facility;facilities; proceeds from both secured and unsecured debt issuances; proceeds from common and preferred equity issuances;
and cash generated from the sale of property and the formation of joint
ventures; and cash flow generated by our operating properties.ventures. Amounts outstanding under the revolving credit facility are retired as needed with proceeds from the issuance of long-term debt, common and preferred equity, cash generated from the disposition of properties and cash flow generated by our operating properties.
During 2011,
As of December 31, 2014, we
paid off our fixed-rate 7% unsecured notes totaling $117.7had an available borrowing capacity of $306.8 million
and redeemed $77.2 million of our 3.95% convertible senior unsecured notes using our revolving credit facility. In addition, we entered into a one year term loan in the amount of $200 million at a borrowing rate that floats at a margin over LIBOR. Loan proceeds were used to pay down amounts outstanding under our revolving credit
facility.Effective September 30, 2011,facility, and our debt maturities for 2015 total $225.9 million. We repaid $315 million of medium term notes during 2014 from the net proceeds of our $250 million issuance in October 2013 of 4.45% senior unsecured notes that previously had been invested in short-term investments of $50 million and cash and cash equivalents. Additionally in 2014, we entered into an amended and restated $500redeemed the total outstanding principal amount of $100 million of our 8.1% senior unsecured notes, which was funded through our revolving credit facility.
Currently, we are in negotiations associated with a $200 million unsecured
revolving credit facility. The facility expires in September 2015, provides forfive-year term note and a
one-yearten-year extension
upon request and provides borrowing rates that float at a margin over LIBOR plus a facility fee. The borrowing margin and facility fee are priced off a grid that is tied to our senior unsecured credit ratings,of an existing $66 million secured note, which are
currently 125anticipated to close by the first quarter of 2015. The proceeds of the term note will be used for general corporate purposes, and
25 basis points, respectively. This results in a decreasethe interest rate associated with the existing secured note is anticipated to be reduced by 3.9% to 3.5% with approximately $6.1 million of
150 basis points in the borrowing margin from the previous margin of 275 basis points and a decrease of 25 basis points in the facility fee, substantially reducing our cost of borrowing.As of December 31, 2011, we had $145.0 million outstanding under our $500 million revolving credit facility and $21.5 million was outstanding under our $99 million credit facility, which we use for cash management purposes. debt extinguishment costs being realized.
We believe proceeds from
the transactions above and our
dispositioncapital recycling program,
for 2012, combined with our available capacity under the
revolving credit facilities, will provide adequate liquidity to fund our capital
needs.needs, including acquisitions and new development activities. In the event our
dispositioncapital recycling program does not progress as expected, we believe other debt and equity alternatives are available to us. Although external market conditions are not within our control, we do not currently foresee any
reasonsreason that would prevent us from entering the capital
markets.Our most restrictive debt covenants, including debtmarkets if needed.
During 2014, aggregate gross sales proceeds from our dispositions totaled $387.4 million. Operating cash flows from discontinued operations are included in net cash from operating activities in our Consolidated Statements of Cash Flows, while proceeds from discontinued operations are included as investing activities. At December 31, 2014, discontinued operations represent .4% of our net cash from operating activities, and we expect future net cash from operating activities to assets, secured debtdecrease accordingly when compared to assets, fixed charge and unencumbered interest coverage and debt yield ratios, limitprior periods. This is representative of our centers that were classified as discontinued operations or held for sale prior to April 1, 2014, our adoption date for the amountnew qualification criteria for discontinued operations.
We have non-recourse debt secured by acquired or developed properties held in several of our real estate joint ventures and partnerships.
Off balanceOff-balance sheet mortgage debt for our unconsolidated real estate joint ventures and partnerships totaled
$556.9$380.8 million, of which our
pro rata ownership
percentage is
$198.1$156.2 million, at December 31,
2011.2014. Scheduled principal mortgage payments on this debt, excluding non-cash related items totaling
$1.7$1.1 million, at 100% are as follows (in millions):
| | | | |
2012 | | $ | 29.6 | |
2013 | | | 55.4 | |
2014 | | | 116.4 | |
2015 | | | 41.5 | |
2016 | | | 98.0 | |
Thereafter | | | 214.3 | |
| | | | |
Total | | $ | 555.2 | |
| | | | |
|
| | | |
| 2015 | $ | 77.6 |
|
| 2016 | 110.9 |
|
| 2017 | 56.8 |
|
| 2018 | 6.3 |
|
| 2019 | 6.6 |
|
| Thereafter | 121.5 |
|
| Total | $ | 379.7 |
|
We hedge the future cash flows of certain debt transactions, as well as changes in the fair value of our debt instruments, principally through interest rate contracts with major financial institutions. We generally have the right to sell or otherwise dispose of our assets except in certain cases where we are required to obtain our joint venture partners’ consent or a third party consent for assets held in special purpose entities
whichthat are 100% owned by us.
Acquisitions
Acquisitions and Joint VenturesDuring 2011,2014, we acquired two shoppingone center in Arizona with a gross purchase price of $43.8 million.
Dispositions
During 2014, we sold 30 centers
for approximately $42.9 million.In April 2011, we acquired a 50%-ownedand other property, including real estate assets through our interest in unconsolidated real estate joint venture interest in three retail properties for approximately $11.6 millionventures and purchased our partner’s 50% unconsolidated interest in a property for $11.5 million, which included their sharepartnerships, and we partially disposed of a construction note obligation.
Dispositions
During 2011, we sold eight retail properties, three industrial properties, a retail building and 11 undeveloped land parcels with aggregate gross sales proceeds of $117.2 million, which generated a gain of $11.7 million. Also, an unconsolidated real estate joint venture sold two industrial buildings withinterest. Our share of aggregate gross sales proceeds aggregating $7.6from these transactions totaled $387.4 million and generated our share of the gains of approximately $174.2 million.
During 2014, we completed the dissolution of our consolidated real estate joint venture with Hines, in which
did not generatewe owned a
gain.30% interest. This joint venture held a portfolio of 13 centers located in Texas, Tennessee, Georgia, Florida and North Carolina. The transaction was completed through the distribution of five centers to us, resulting in an increase to our equity of $11.0 million, and eight centers to Hines. The centers distributed to Hines were classified as held for sale at December 31, 2013, and we realized a $23.3 million gain in discontinued operations associated with this transaction.
New Development
and Capital ExpendituresAt December 31,
2011,2014, we had
11four projects under
various stages of construction and development with a total square footage of approximately
2.1.7 million,
including three newly acquired projects located in Florida, Georgia and Virginia,of which
uponwe have funded $82.8 million to date on these projects. Upon completion,
will represent an estimated total investment of $74.4 million. Overall, we expect our
aggregate net investment in these
11 properties
upon completion to be
$193.7 million, net of future proceeds from land sales and tax incentive financing of $24.6$156.6 million.
In November, we formed a real estate joint venture to develop a shopping center in Alexandria, Virginia. This development will include 258,000 square feet of retail space and is anchored by a 140,000 square foot supermarket. This project will represent an investment of approximately $61.6 million upon completion and provides us with our entry into the dynamic Washington, D.C. market.
Our new development projects are financed
initiallygenerally under our revolving credit facility, as it is our
general practice not to use third party construction financing. Management monitors amounts outstanding under our revolving credit facility and periodically pays down such balances using cash generated from operations, from
both secured and unsecured debt issuances, from common and preferred share issuances and from
dispositionsthe disposition of properties.
Capital Expenditures
Capital expenditures for additions to the existing portfolio, acquisitions, tenant improvements, new development and our share of investments in unconsolidated real estate joint ventures and partnerships totaled $165.5are as follows (in thousands):
|
| | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 |
| Acquisitions | $ | 43,587 |
| | $ | 129,719 |
|
| New Development | 47,402 |
| | 19,264 |
|
| Tenant Improvements | 24,432 |
| | 33,259 |
|
| Capital Improvements | 15,202 |
| | 13,312 |
|
| Other (includes redevelopments) | 14,681 |
| | 10,092 |
|
| Total | $ | 145,304 |
| | $ | 205,646 |
|
The decrease in capital expenditures is attributable primarily to a decline in acquisition activity offset by the increase in new development activity during 2014 compared to the same period in 2013.
For 2015, we anticipate our acquisitions to total between $200 million
in 2011, $189.9and $250 million. We anticipate our 2015 tenant improvement expenditures to be consistent with 2014. Our new development investment for 2015 is estimated to be approximately $50 million
in 2010 and $162.9 million in 2009. Weto $100 million. For 2015, capital improvement spending is expected to be consistent with 2014 expenditures. No assurances can be provided that our planned capital activities will occur. Further, we have entered into commitments aggregating
$86.1$64.3 million comprised principally of construction contracts which are generally due in 12 to 36
months.months and anticipated to be funded under our revolving credit facility.
Capital expenditures for additions described above relate to cash flows from investing activities as follows(in thousands):
|
| | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 |
| Acquisition of real estate and land | $ | 43,587 |
| | $ | 105,765 |
|
| Development and capital improvements | 100,926 |
| | 76,992 |
|
| Real estate joint ventures and partnerships - Investments | 791 |
| | 22,600 |
|
Notes receivable from real estate joint ventures and partnerships - Advances for capital expenditures | — |
| | 289 |
|
| Total | $ | 145,304 |
| | $ | 205,646 |
|
Capitalized soft costs, including payroll and other general and administrative costs, interest and real estate taxes, totaled $10.7 million and $9.7 million for the year ended December 31, 2014 and 2013, respectively.
Total debt outstanding was
$2.5 billion and $2.6$1.9 billion at December 31,
20112014 and
2010, respectively. Total debtincluded $1.7 billion which bears interest at
December 31, 2011, included $2.0 billion on which interestfixed rates
are fixed and
$517.0$286.2 million, including the effect of
$119.3$65.3 million of interest rate contracts, which bears interest at variable rates. Additionally, of our total debt,
$1.0 billion$595.0 million was secured by operating properties while the remaining
$1.5$1.3 billion was unsecured.
We
At December 31, 2014, we have a $500 million unsecured revolving credit facility which expires in September 2015April 2017 and provides borrowing rates that float at a margin over LIBOR plus a facility fee. TheAt December 31, 2014, the borrowing margin and facility fee, which are priced off a grid that is tied to our senior unsecured credit ratings, which are currently 125.0were 115 and 25.020 basis points, respectively. The facility also contains a competitive bid feature that will allowallows us to request bids for up to $250 million. Additionally, an accordion feature allows us to increase the facility amount up to $700 million. As of February 15, 2012,January 31, 2015, we had $140.0$207.0 million outstanding, and the available balance was $356.6$288.8 million, net of $3.4$4.2 million in outstanding letters of credit.
We also havehad an agreement with a bank for an unsecured and uncommitted overnight facility totaling $99 million that we maintainmaintained for cash management purposes. The facility providesprovided for fixed interest rate loans at a 30 day30-day LIBOR rate plus a borrowing margin based on market liquidity. As of February 15, 2012, $23.0 million was outstanding underJanuary 2, 2015, this facility was canceled and has not been replaced.
For the
available balance was $76.0 million.During 2011,year ended December 31, 2014, the maximum balance and weighted average balance outstanding under both facilities combined were $330.7$270.0 million and $151.8$151.0 million, respectively, at a weighted average interest rate of 1.5%.8%.
During 2014, we repaid $315 million of medium term notes from the net proceeds of our $250 million issuance in October 2013 of 4.45% senior unsecured notes that had been previously invested in short-term investments of $50 million and cash and cash equivalents. Additionally, in 2014, we redeemed the total outstanding principal amount of $100 million of our 8.1% senior unsecured notes, which was funded through our revolving credit facility.
Our five most restrictive covenants include debt to assets, secured debt to assets, fixed charge and unencumbered interest coverage and debt yield ratios. We
believe we were in full complianceare not aware of any non-compliance with our public debt and revolving credit facility covenants as of December 31,
2011.2014.
Our
most restrictive public debt covenant ratios, as defined in our indenture
agreementand supplemental indenture agreements, were as follows at December 31,
2011:2014: |
| | | | |
Covenant | | Restriction | | Actual |
Debt to Asset Ratio | | Less than 60.0% | | 44.8%41.7% |
Secured Debt to Asset Ratio | | Less than 40.0% | | 18.1%12.8% |
FixedAnnual Service Charge Ratio
| | Greater than 1.5 | | 2.33.7 |
Unencumbered Asset Test | | Greater than 100%150% | | 256.8%253.0% |
At December 31,
2011,2014, we had
fourtwo interest rate contracts,
maturing through October 2017, with an aggregate notional amount of
$119.3$65.3 million that were designated as fair value hedges and convert fixed interest payments at rates
ranging from 4.2% toof 7.5% to variable interest payments ranging from
.5%4.2% to
4.4%4.3%.
We also have three
At December 31, 2014, we had one interest rate
contractscontract with an aggregate notional amount of
$27.1$5.2 million that
werewas designated as
a cash flow
hedges. These contracts have maturities through September 2017hedge. This contract matures in December 2015 and
either fix or capfixes interest rates
ranging from 2.3% to 5.0%at 2.4%. We have determined that
these contracts arethis contract is highly effective in offsetting future variable interest cash flows.
We could be exposed to losses in the event of nonperformance by the
counter-parties;counter-parties related to our interest rate contracts; however, management believes such nonperformance is unlikely.
Equity
EquityIn February 2011,2015, our Board of Trust Managers approved an increase toin our quarterly2015 first quarter dividend rate for our common shares from $.260$.325 to $.275$.345 per share commencing with the first quarter 2011 distribution.share. Common and preferred dividends paid totaled $165.7$199.3 million during 2011.2014. During 2014, we paid a special dividend for our common shares in the amount of $.25 per share, which was due to the significant gains on dispositions of property. Our dividend payout ratio (as calculated as dividends paid on common shares divided by funds from operationoperations (“FFO”) - basic) for 2011, 2010 and 2009the year ended December 31, 2014 approximated 76.7%, 66.9% and 66.3%, respectively, which is inclusive74.5%. FFO - basic for the year ended December 31, 2014 included the following non-cash transactions; the write-off of non-cash transactions including impairment chargesnet debt costs, deferred tax benefit adjustments and other non-cash items. Subsequent to Excluding the special dividend paid, our dividend payout ratio would have been 62.5% for the year ended December 31, 2011, our Board of Trust Managers approved2014.
We have an
increase to our quarterly dividend rate to $.290 per share.In September 2011, we filed aeffective universal shelf registration statement which is effective for the next three years.expires in September 2017. We will continue to closely monitor both the debt and equity markets and carefully consider our available financing alternatives, including both public offerings and private placements.
We have debt obligations related to our mortgage loans and unsecured debt, including any draws on our
revolving credit facilities. We have shopping centers that are subject to non-cancelable long-term ground leases where a third party owns and has leased the underlying land to us to construct and/or operate a shopping center. In addition, we have non-cancelable operating leases pertaining to office space from which we conduct our business. The table below excludes obligations related to our new development projects because such amounts are not fixed or
determinable. We have entered intodeterminable, and commitments aggregating
$86.1$64.3 million comprised principally of construction contracts which are generally due in 12 to 36 months. The following table summarizes our primary contractual obligations as of December 31,
20112014 (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2012 | | | 2013 | | | 2014 | | | 2015 | | | 2016 | | | Thereafter | | | Total | |
Mortgages and Notes Payable: (1) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Unsecured Debt | | $ | 445,313 | | | $ | 218,355 | | | $ | 339,571 | | | $ | 275,942 | | | $ | 93,651 | | | $ | 287,461 | | | $ | 1,660,293 | |
Secured Debt | | | 171,640 | | | | 192,094 | | | | 199,150 | | | | 188,433 | | | | 181,178 | | | | 335,129 | | | | 1,267,624 | |
| | | | | | | |
Lease Payments | | | 3,569 | | | | 3,519 | | | | 3,183 | | | | 2,956 | | | | 2,623 | | | | 121,295 | | | | 137,145 | |
| | | | | | | |
Other Obligations (2) | | | 64,521 | | | | 36,660 | | | | | | | | | | | | | | | | | | | | 101,181 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | |
Total Contractual Obligations | | $ | 685,043 | | | $ | 450,628 | | | $ | 541,904 | | | $ | 467,331 | | | $ | 277,452 | | | $ | 743,885 | | | $ | 3,166,243 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
| | 2015 | | 2016 | | 2017 | | 2018 | | 2019 | | Thereafter | | Total |
Mortgages and Notes Payable (1) | | | | | | | | | | | | | |
| Unsecured Debt | $ | 145,244 |
| | $ | 115,164 |
| | $ | 60,304 |
| | $ | 232,802 |
| | $ | 33,854 |
| | $ | 1,003,928 |
| | $ | 1,591,296 |
|
| Secured Debt | 168,945 |
| | 182,840 |
| | 131,450 |
| | 58,569 |
| | 59,973 |
| | 87,810 |
| | 689,587 |
|
| Lease Payments | 2,973 |
| | 2,851 |
| | 2,672 |
| | 2,636 |
| | 2,530 |
| | 117,642 |
| | 131,304 |
|
Other Obligations (2) | 56,763 |
| | 57,814 |
| | 50 |
| | — |
| | — |
| | — |
| | 114,627 |
|
Total Contractual Obligations | $ | 373,925 |
| | $ | 358,669 |
| | $ | 194,476 |
| | $ | 294,007 |
| | $ | 96,357 |
| | $ | 1,209,380 |
| | $ | 2,526,814 |
|
___________________
| |
| (1) | Includes principal and interest with interest on variable-rate debt calculated using rates at December 31, 2011,2014, excluding the effect of interest rate swaps. Also, excludes a $74.1$72.1 million debt service guaranty liability. |
| |
| (2) | Other obligations include income and real estate tax payments, commitments associated with our secured debt contributionsand other employee payments. Included in 2015 is the estimated contribution to our retirement plan, and other employee payments. which meets or exceeds the minimum statutory funding requirements. See Note 19 for additional information. Included in 2016 is a purchase obligation of $23.8 million. See Note 21 for additional information. |
Related to
our investment in a development project in Sheridan, Colorado, we
our joint venture partner and the joint venture have
each provided a guaranty for the payment of any debt service shortfalls on tax increment revenue bonds issued in connection with the project.
In 2007, theThe Sheridan Redevelopment Agency
(“Agency”("Agency") issued
$97 million of Series A bonds used for an urban renewal
project.project, of which $72.1 million remain outstanding at December 31, 2014. The bonds are to be repaid with incremental sales and property taxes and a public improvement fee
(“PIF”("PIF") to be assessed on current and future retail sales and, to the extent necessary, any amounts we may have to provide under a guaranty. The incremental taxes and PIF are to remain intact until the earlier of the payment of the bond liability in full or
2030 (unless such date is otherwise extended by the Agency).In connection2040. The debt associated with the above project and a lawsuit settlementthis guaranty has been recorded in 2009, the joint venture purchased a portionour consolidated financial statements as of the bonds in the amount of $51.3 million at par, and we established a $46.3 million letter of credit.
On April 28, 2011, the Agency remarketed the bonds, which included an extension of the incremental taxes and PIF for an additional 10 years. All of the outstanding bonds were recalled by the Agency and replaced with $74.1 million in senior bonds and $57.7 million in subordinate bonds. This transaction resulted in us receiving approximately $16.5 million in cash proceeds and $57.7 million in new subordinated bonds replacing the face value of our $51.3 million of senior bonds and $22.4 million of subordinate bonds. The subordinate bonds had been previously written down to a fair value of $10.7 million. Upon the completion of this transaction, we recorded a net credit loss on the exchange of bonds of approximately $18.7 million, and our $46.3 million letter of credit was terminated.
December 31, 2014.
Off Balance Sheet Arrangements
As of December 31,
2011,2014, none of our
off balanceoff-balance sheet arrangements had a material effect on our liquidity or availability of, or requirement for, our capital resources. Letters of credit totaling
$3.4 million and $52.4$4.2 million were outstanding under the revolving credit facility at December 31,
2011 and 2010, respectively.2014.
We have entered into several unconsolidated real estate joint ventures and partnerships. Under many of these agreements, we and our joint venture partners are required to fund operating capital upon shortfalls in working capital. We have also committed to fund the capital requirements of
several new development joint ventures. As operating manager of most of these entities, we have considered these funding requirements in our business plan.
Reconsideration events, including changes in variable interests, could cause us to consolidate these joint ventures and partnerships. We continuously evaluate these events as we become aware of them. Some triggers to be considered are additional contributions required by each partner and each partner’s ability to make those contributions. Under certain of these circumstances, we may purchase our partner’s interest. Our material unconsolidated real estate joint ventures are with entities which appear sufficiently stable; however, if market conditions were to
continue to deteriorate and our partners are unable to meet their commitments, there is a possibility we may have to consolidate these entities. If we were to consolidate all of our unconsolidated real estate joint ventures, we would
stillcontinue to be in compliance with our debt covenants.
As of December 31,
2011, two2014, one unconsolidated real estate joint
ventures wereventure was determined to be
VIEsa VIE through the issuance of
a secured
loans,loan, since the
lenders havelender had the ability to make decisions that could have a significant impact on the profitability of the
entities. In addition, we have another unconsolidated real estate joint venture with an interest in an entity, which is deemed to be a VIE since the unconsolidated joint venture provided a guaranty for the entity’s debt.entity. Our maximum risk of loss associated with
these VIEsthis VIE was limited to
$75.3$11.0 million at December 31,
2011.2014.
As of December 31, 2014, we are working with a developer of a mixed-use project in Washington and have executed an agreement to purchase the retail portion of the project for approximately $23.8 million at closing, which is estimated to be in August 2016.
We have a real estate limited partnership agreement with a foreign institutional investor
with a remaining potential obligation to purchase up to
$280$240 million
of retail properties in various states.through December 31, 2015. Our ownership in this unconsolidated real estate limited partnership is 51%. To date,
no properties haveone property has been purchased.
Non-GAAP Financial Measures
Certain of our key performance indicators are considered non-GAAP financial measures. Management uses these measures along with our GAAP financial statements in order to evaluate our operating results. We believe these additional measures provide users of our financial information additional comparable indicators of our industry, as well as, our performance.
Funds from Operations
Effective for the fourth quarter of 2011, the
The National Association of Real Estate Investment Trusts (“NAREIT”)
issued updated guidance on the definition of funds from operation (“FFO”) to exclude the effects of impairment related to depreciable real estate assets and in substance real estate equity investments. Previously, our calculation of FFO did not exclude impairment of depreciable real estate assets and as a result, we have changed our presentation of FFO for all periods presented to comply with the revised guidance. NAREIT defines FFO as net income (loss) attributable to common shareholders computed in accordance with GAAP, excluding
extraordinary items and gains or losses from sales of operating real estate assets and
extraordinary items,interests in real estate equity investments, plus depreciation and amortization of operating properties and impairment of depreciable real estate and in substance real estate equity investments, including our share of unconsolidated real estate joint ventures and partnerships. We calculate FFO in a manner consistent with the NAREIT definition.
We believe FFO is a widely recognized measure of REIT operating performance which provides our shareholders with a relevant basis for comparison among other REITs. Management uses FFO as a supplemental internal measure to conduct and evaluate our business because there are certain limitations associated with using GAAP net income by itself as the primary measure of our operating performance. Historical cost accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, management believes that the presentation of operating results for real estate companies that uses historical cost accounting is insufficient by itself. There can be no assurance that FFO presented by us is comparable to similarly titled measures of other REITs.
FFO should not be considered as an alternative to net income or other measurements under GAAP as an indicator of our operating performance or to cash flows from operating, investing or financing activities as a measure of liquidity. FFO does not reflect working capital changes, cash expenditures for capital improvements or principal payments on indebtedness.
FFO is calculated as follows (in thousands):
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
| | | |
Net (loss) income attributable to common shareholders | | | $ (19,855) | | | | $ 10,730 | | | | $ 135,626 | |
Depreciation and amortization | | | 150,668 | | | | 143,393 | | | | 144,211 | |
Depreciation and amortization of unconsolidated real estate joint ventures and partnerships | | | 22,887 | | | | 20,085 | | | | 18,433 | |
Impairment of operating properties and real estate equity investments | | | 28,995 | | | | 15,948 | | | | 6,062 | |
Impairment of operating properties of unconsolidated real estate joint ventures and partnerships | | | 7,025 | | | | 115 | | | | - | |
Gain on acquisition | | | (4,559) | | | | - | | | | - | |
Gain on land and merchant development sales | | | - | | | | - | | | | (18,688) | |
Gain on sale of property | | | (11,846) | | | | (3,069) | | | | (81,006) | |
Loss (gain) on sale of property of unconsolidated real estate joint ventures and partnerships | | | 10 | | | | (194) | | | | (4) | |
| | | | | | | | | | | | |
Funds from operations – basic and diluted | | | $ 173,325 | | | | $ 187,008 | | | | $ 204,634 | |
| | | | | | | | | | | | |
| | | |
Weighted average shares outstanding – basic | | | 120,331 | | | | 119,935 | | | | 109,546 | |
Effect of dilutive securities: | | | | | | | | | | | | |
Share options and awards | | | - | | | | 845 | | | | 632 | |
| | | | | | | | | | | | |
Weighted average shares outstanding – diluted | | | 120,331 | | | | 120,780 | | | | 110,178 | |
| | | | | | | | | | | | |
|
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Net income (loss) attributable to common shareholders | $ | 277,168 |
| | $ | 184,145 |
| | $ | 109,210 |
|
| Depreciation and amortization | 145,660 |
| | 152,075 |
| | 143,783 |
|
Depreciation and amortization of unconsolidated real estate joint ventures and partnerships | 14,793 |
| | 17,550 |
| | 20,955 |
|
Impairment of operating properties and real estate equity investments | 895 |
| | 457 |
| | 15,033 |
|
Impairment of operating properties of unconsolidated real estate joint ventures and partnerships | 305 |
| | 366 |
| | 19,946 |
|
Gain on acquisition including associated real estate equity investment | — |
| | (20,234 | ) | | (1,869 | ) |
Gain on sale of property and interests in real estate equity investments | (179,376 | ) | | (95,675 | ) | | (83,683 | ) |
Gain on sale of property of unconsolidated real estate joint ventures and partnerships | (4,919 | ) | | (15,951 | ) | | (1,247 | ) |
| Other | (8 | ) | | (1 | ) | | — |
|
| Funds from operations – basic | 254,518 |
| | 222,732 |
| | 222,128 |
|
| Income attributable to operating partnership units | 2,171 |
| | 1,780 |
| | 1,721 |
|
| Funds from operations - diluted | $ | 256,689 |
| | $ | 224,512 |
| | $ | 223,849 |
|
| | | | | | |
| Weighted average shares outstanding – basic | 121,542 |
| | 121,269 |
| | 120,696 |
|
| Effect of dilutive securities: | | | | | |
| Share options and awards | 1,331 |
| | 1,191 |
| | 1,009 |
|
| Operating partnership units | 1,497 |
| | 1,554 |
| | 1,578 |
|
| Weighted average shares outstanding – diluted | 124,370 |
| | 124,014 |
| | 123,283 |
|
| | | | | | |
| Funds from operations per share – basic | $ | 2.09 |
| | $ | 1.84 |
| | $ | 1.84 |
|
| | | | | | |
| Funds from operations per share – diluted | $ | 2.06 |
| | $ | 1.81 |
| | $ | 1.82 |
|
Same Property Net Operating Income
We consider SPNOI to be a key indicator of our financial performance as it provides a better indication of the recurring cash return on our properties by excluding certain non-cash revenues and expenses, as well as other infrequent or one-time items. We believe a pro rata basis is the most useful measurement as it provides our proportional share of SPNOI from all owned properties, including our share of SPNOI from unconsolidated joint ventures and partnerships, which cannot be readily determined under GAAP measurements and presentation. Although SPNOI is a widely used measure among REITs, there can be no assurance that SPNOI presented by us is comparable to similarly titled measures of other REITs.
Properties are included in the SPNOI calculation if they are owned and operated for the entirety of the most recent two fiscal year periods, except for properties for which significant redevelopment or expansion occurred during either of the periods presented, and properties classified as discontinued operations. While there is judgment surrounding changes in designations, we move new development and redevelopment properties once they have stabilized, which is typically upon attainment of 90% occupancy. A rollforward of the properties included in our same property designation is as follows:
|
| | | | | |
| | Three Months Ended
December 31, 2014 | | Twelve Months Ended
December 31, 2014 |
| Beginning of the period | 234 |
| | 252 |
|
| Properties added: | | | |
| Acquisitions | — |
| | 4 |
|
| New Developments | — |
| | 4 |
|
| Redevelopments | — |
| | 2 |
|
| Properties removed: | | | |
| Dispositions | (15 | ) | | (39 | ) |
| Other | (1 | ) | | (5 | ) |
| End of the period | 218 |
| | 218 |
|
We calculate SPNOI using operating income as defined by GAAP excluding property management fees, certain non-cash revenues and expenses such as straight-line rental revenue and the related reversal of such amounts upon early lease termination, depreciation, amortization, impairment losses, general and administrative expenses, acquisition costs and other nonrecurring items such as lease cancellation income, environmental abatement costs and demolition expenses. Consistent with the capital treatment of such costs under GAAP, tenant improvements, leasing commissions and other direct leasing costs are excluded from SPNOI. A reconciliation of operating income to SPNOI is as follows (in thousands):
|
| | | | | | | | | | | | | | | |
| | Three Months Ended
December 31, | | Twelve Months Ended
December 31, |
| | 2014 | | 2013 | | 2014 | | 2013 |
| Operating Income | $ | 43,969 |
| | $ | 38,832 |
| | $ | 182,038 |
| | $ | 159,868 |
|
| Less: | | | | | | | |
Revenue adjustments (1) | 2,259 |
| | 2,340 |
| | 7,213 |
| | 10,506 |
|
| Add: | | | | | | | |
| Property management fees | 662 |
| | 653 |
| | 2,847 |
| | 2,980 |
|
| Depreciation and amortization | 36,408 |
| | 39,724 |
| | 150,356 |
| | 146,763 |
|
| Impairment loss | 1,024 |
| | — |
| | 1,024 |
| | 2,579 |
|
| General and administrative | 7,023 |
| | 6,559 |
| | 24,902 |
| | 25,371 |
|
| Acquisition costs | 185 |
| | 128 |
| | 254 |
| | 498 |
|
Other (2) | 98 |
| | 190 |
| | 570 |
| | 316 |
|
| Net Operating Income | 87,110 |
| | 83,746 |
| | 354,778 |
| | 327,869 |
|
Less: NOI related to consolidated entities not defined as same property and noncontrolling interests | (10,298 | ) | | (10,477 | ) | | (51,843 | ) | | (38,007 | ) |
Add: Pro rata share of unconsolidated entities defined as same property | 9,068 |
| | 9,615 |
| | 36,188 |
| | 38,169 |
|
| Same Property Net Operating Income | $ | 85,880 |
| | $ | 82,884 |
| | $ | 339,123 |
| | $ | 328,031 |
|
___________________
| |
| (1) | Revenue adjustments consist primarily of straight-line rentals, lease cancellation income and fee income primarily from real estate joint ventures and partnerships. |
| |
| (2) | Other includes items such as environmental abatement costs and demolition expenses. |
Newly Issued Accounting Pronouncements
In May 2011,February 2013, the FASB issued Accounting Standards Update (“ASU”) No. 2011-04, “Amendments2014-09, "Revenue from Contracts with Customers." This ASU's core objective is for an entity to Achieve Common Fair Value Measurement and Disclosure Requirementsrecognize revenue based on the consideration it expects to receive in U.S. GAAP and IFRSs,” which amends previousexchange for goods or services. Additionally, this ASU requires entities to use a single model in accounting for revenues derived from contracts with customers. ASU No. 2014-09 replaces prior guidance resulting in common fair value measurement and disclosure requirements between GAAP and International Financial Reporting Standards. The amendments both clarifyregarding the applicationrecognition of existing fair value measurement requirements and changes certain principles or requirementsrevenue from sales of real estate except for measuring fair value or for disclosing information about fair value measurements.revenue from sales that are part of a sale-leaseback transaction. The provisions of this updateASU No. 2014-09 are effective for us aton January 1, 2012.2017, and are required to be applied either on a retrospective or a modified retrospective approach. We are currently assessing the impact, if any, that the adoption of this ASU will have on our consolidated financial statements.
In August 2014, the FASB issued ASU No. 2014-15, "Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern." This ASU's core objective is that management should evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued or are available to be issued. The provisions of ASU No. 2014-15 are effective for us as of December 31, 2016, and early adoption is permitted. We do not
anticipateexpect the adoption of this update to
materiallyhave any impact
to our consolidated financial statements.
In
December 2011,January 2015, the FASB issued
Accounting Standards UpdateASU No.
2011-10, “Derecognition2015-01, "Simplifying Income Statement Presentation by Eliminating the Concept of
in Substance Real Estate – A Scope Clarification,” which clarifies which guidance a reporting entity should follow when it deconsolidates a subsidiary that is in substance real estate as a resultExtraordinary Items." This ASU eliminates the concept of
a default on the subsidiary’s nonrecourse debt.extraordinary items from GAAP. The provisions of
this update will be applied prospectively andASU No. 2015-01 are effective for us
at June 15, 2012.as of January 1, 2016, and early adoption is permitted. We
plan to adopt this ASU on January 1, 2015, and we do not
anticipateexpect the adoption of this update to
materiallyhave any impact
to our consolidated financial statements.
ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk | Quantitative and Qualitative Disclosures About Market Risk |
We use fixed and floating-rate debt to finance our capital requirements. These transactions expose us to market risk related to changes in interest rates. Derivative financial instruments are used to manage a portion of this risk, primarily interest rate contracts with major financial institutions. These agreements expose us to credit risk in the event of non-performance by the counter-parties. We do not engage in the trading of derivative financial instruments in the normal course of business. At December 31, 2011,2014, we had fixed-rate debt of $2.0$1.7 billion and variable-rate debt of $517.0$286.2 million, after adjusting for the net effect of $119.3$65.3 million notional amount of interest rate contracts. In the event interest rates were to increase 100 basis points and holding all other variables constant, annual net income and cash flows for the following year would decrease by approximately $5.2$.2 million associated with our variable-rate debt, including the effect of the interest rate contracts. The effect of the 100 basis points increase would decrease the fair value of our variable-rate and fixed-rate debt by approximately $14.1$5.4 million and $66.2$91.9 million, respectively.
ITEM 8. | Financial Statements and Supplementary Data |
ITEM 8. Financial Statements and Supplementary Data
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Trust Managers and Shareholders of
Weingarten Realty Investors
We have audited the accompanying consolidated balance sheets of Weingarten Realty Investors and subsidiaries (the “Company”"Company") as of December 31, 20112014 and 2010,2013, and the related consolidated statements of operations, and comprehensive income, equity, and cash flows for each of the three years in the period ended December 31, 2011.2014. Our audits also included the financial statement schedules listed in the Index at Item 15. These financial statements and financial statement schedules are the responsibility of the Company’s management. Our responsibility is to express an opinion on the financial statements and financial statement schedules based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Weingarten Realty Investors and subsidiaries as of December 31, 20112014 and 2010,2013, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2011,2014, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such financial statement schedules, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein. As discussed in Notes 2 and 15 to the consolidated financial statements, the Company has changed its method of accounting for and disclosure of discontinued operations for the year ended December 31, 2014 due to the adoption of Accounting Standards Update 2014-08, "Reporting Discontinued Operations and Disclosure of Disposals of Components of an Entity."
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Company’s internal control over financial reporting as of December 31, 2011,2014, based on the criteria established inInternal Control—Integrated Framework(2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 29, 201219, 2015 expressed an unqualified opinion on the Company’s internal control over financial reporting. /s/ Deloitte & Touche LLP
February
29, 201219, 2015
WEINGARTEN REALTY INVESTORS
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(In thousands, except per share amounts)
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
Revenues: | | | | | | | | | | | | |
Rentals, net | | $ | 526,533 | | | $ | 521,376 | | | $ | 534,374 | |
Other | | | 15,028 | | | | 13,708 | | | | 17,852 | |
| | | | | | | | | | | | |
Total | | | 541,561 | | | | 535,084 | | | | 552,226 | |
| | | | | | | | | | | | |
| | | |
Expenses: | | | | | | | | | | | | |
Depreciation and amortization | | | 152,983 | | | | 145,893 | | | | 142,549 | |
Operating | | | 101,657 | | | | 102,138 | | | | 99,540 | |
Real estate taxes, net | | | 64,243 | | | | 61,537 | | | | 67,346 | |
Impairment loss | | | 58,734 | | | | 33,317 | | | | 34,983 | |
General and administrative | | | 25,528 | | | | 24,993 | | | | 25,921 | |
| | | | | | | | | | | | |
Total | | | 403,145 | | | | 367,878 | | | | 370,339 | |
| | | | | | | | | | | | |
| | | |
Operating Income | | | 138,416 | | | | 167,206 | | | | 181,887 | |
Interest Expense, net | | | (141,757) | | | | (148,152) | | �� | | (152,041) | |
Interest and Other Income, net | | | 5,062 | | | | 9,825 | | | | 11,425 | |
(Loss) Gain on Redemption of Convertible Senior Unsecured Notes | | | - | | | | (135) | | | | 25,311 | |
Equity in Earnings of Real Estate Joint Ventures and Partnerships, net | | | 7,834 | | | | 12,889 | | | | 5,548 | |
Gain on Land and Merchant Development Sales | | | - | | | | - | | | | 18,688 | |
Provision for Income Taxes | | | (395) | | | | (180) | | | | (6,269) | |
| | | | | | | | | | | | |
Income from Continuing Operations | | | 9,160 | | | | 41,453 | | | | 84,549 | |
| | | | | | | | | | | | |
Operating (Loss) Income from Discontinued Operations | | | (4,373) | | | | 6,687 | | | | 9,696 | |
Gain on Sale of Property from Discontinued Operations | | | 10,215 | | | | 1,093 | | | | 55,765 | |
| | | | | | | | | | | | |
Income from Discontinued Operations | | | 5,842 | | | | 7,780 | | | | 65,461 | |
Gain on Sale of Property | | | 1,737 | | | | 2,005 | | | | 25,266 | |
| | | | | | | | | | | | |
Net Income | | | 16,739 | | | | 51,238 | | | | 175,276 | |
Less: Net Income Attributable to Noncontrolling Interests | | | (1,118) | | | | (5,032) | | | | (4,174) | |
| | | | | | | | | | | | |
Net Income Adjusted for Noncontrolling Interests | | | 15,621 | | | | 46,206 | | | | 171,102 | |
Dividends on Preferred Shares | | | (35,476) | | | | (35,476) | | | | (35,476) | |
| | | | | | | | | | | | |
Net (Loss) Income Attributable to Common Shareholders | | $ | (19,855) | | | $ | 10,730 | | | $ | 135,626 | |
| | | | | | | | | | | | |
| | | |
Earnings Per Common Share - Basic: | | | | | | | | | | | | |
(Loss) income from continuing operations attributable to common shareholders | | $ | (0.21) | | | $ | 0.02 | | | $ | 0.64 | |
Income from discontinued operations | | | 0.04 | | | | 0.07 | | | | 0.60 | |
| | | | | | | | | | | | |
Net (loss) income attributable to common shareholders | | $ | (0.17) | | | $ | 0.09 | | | $ | 1.24 | |
| | | | | | | | | | | | |
| | | |
Earnings Per Common Share - Diluted: | | | | | | | | | | | | |
(Loss) income from continuing operations attributable to common shareholders | | $ | (0.21) | | | $ | 0.02 | | | $ | 0.64 | |
Income from discontinued operations | | | 0.04 | | | | 0.07 | | | | 0.59 | |
| | | | | | | | | | | | |
Net (loss) income attributable to common shareholders | | $ | (0.17) | | | $ | 0.09 | | | $ | 1.23 | |
| | | | | | | | | | | | |
| | | |
Comprehensive Income: | | | | | | | | | | | | |
Net Income | | $ | 16,739 | | | $ | 51,238 | | | $ | 175,276 | |
Net unrealized (loss) gain on derivatives | | | (854) | | | | 123 | | | | - | |
Amortization of loss on derivatives | | | 2,551 | | | | 2,566 | | | | 2,481 | |
Retirement liability adjustment | | | (7,666) | | | | (505) | | | | 3,237 | |
| | | | | | | | | | | | |
Comprehensive Income | | | 10,770 | | | | 53,422 | | | | 180,994 | |
Comprehensive Income Attributable to Noncontrolling Interests | | | (1,118) | | | | (5,032) | | | | (4,174) | |
| | | | | | | | | | | | |
Comprehensive Income Adjusted for Noncontrolling Interests | | $ | 9,652 | | | $ | 48,390 | | | $ | 176,820 | |
| | | | | | | | | | | | |
WEINGARTEN REALTY INVESTORS CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts) |
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Revenues: | | | | | |
| Rentals, net | $ | 503,128 |
| | $ | 477,340 |
| | $ | 439,993 |
|
| Other | 11,278 |
| | 11,855 |
| | 11,184 |
|
| Total | 514,406 |
| | 489,195 |
| | 451,177 |
|
| Expenses: | | | | | |
| Depreciation and amortization | 150,356 |
| | 146,763 |
| | 127,703 |
|
| Operating | 95,318 |
| | 97,099 |
| | 88,924 |
|
| Real estate taxes, net | 60,768 |
| | 57,515 |
| | 52,066 |
|
| Impairment loss | 1,024 |
| | 2,579 |
| | 9,585 |
|
| General and administrative | 24,902 |
| | 25,371 |
| | 28,538 |
|
| Total | 332,368 |
| | 329,327 |
| | 306,816 |
|
| Operating Income | 182,038 |
| | 159,868 |
| | 144,361 |
|
| Interest Expense, net | (94,725 | ) | | (96,312 | ) | | (106,248 | ) |
| Interest and Other Income, net | 3,756 |
| | 7,685 |
| | 6,047 |
|
Gain on Sale and Acquisition of Real Estate Joint Venture and Partnership Interests | 1,718 |
| | 33,670 |
| | 14,203 |
|
| Equity in Earnings (Losses) of Real Estate Joint Ventures and Partnerships, net | 22,317 |
| | 35,112 |
| | (1,558 | ) |
| Benefit (Provision) for Income Taxes | 1,261 |
| | (7,046 | ) | | 75 |
|
| Income from Continuing Operations | 116,365 |
| | 132,977 |
| | 56,880 |
|
| Operating Income from Discontinued Operations | 342 |
| | 12,214 |
| | 25,918 |
|
| Gain on Sale of Property from Discontinued Operations | 44,582 |
| | 119,203 |
| | 68,619 |
|
| Income from Discontinued Operations | 44,924 |
| | 131,417 |
| | 94,537 |
|
| Gain on Sale of Property | 146,290 |
| | 762 |
| | 1,004 |
|
| Net Income | 307,579 |
| | 265,156 |
|
| 152,421 |
|
| Less: Net Income Attributable to Noncontrolling Interests | (19,571 | ) | | (44,894 | ) | | (5,781 | ) |
| Net Income Adjusted for Noncontrolling Interests | 288,008 |
| | 220,262 |
| | 146,640 |
|
| Dividends on Preferred Shares | (10,840 | ) | | (18,173 | ) | | (34,930 | ) |
| Redemption Costs of Preferred Shares | — |
| | (17,944 | ) | | (2,500 | ) |
| Net Income Attributable to Common Shareholders | $ | 277,168 |
| | $ | 184,145 |
| | $ | 109,210 |
|
| Earnings Per Common Share - Basic: | | | | | |
| Income from continuing operations attributable to common shareholders | $ | 1.91 |
| | $ | 0.76 |
| | $ | 0.13 |
|
| Income from discontinued operations | 0.37 |
| | 0.76 |
| | 0.77 |
|
| Net income attributable to common shareholders | $ | 2.28 |
| | $ | 1.52 |
| | $ | 0.90 |
|
| Earnings Per Common Share - Diluted: | | | | | |
| Income from continuing operations attributable to common shareholders | $ | 1.89 |
| | $ | 0.75 |
| | $ | 0.13 |
|
| Income from discontinued operations | 0.36 |
| | 0.75 |
| | 0.77 |
|
| Net income attributable to common shareholders | $ | 2.25 |
| | $ | 1.50 |
| | $ | 0.90 |
|
See Notes to Consolidated Financial Statements.
WEINGARTEN REALTY INVESTORS
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share amounts)
| | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
| ASSETS | | | | | | | | |
Property | | $ | 4,688,526 | | | $ | 4,777,794 | |
Accumulated Depreciation | | | (1,059,531) | | | | (971,249) | |
Property Held for Sale, net | | | 73,241 | | | | - | |
| | | | | | | | |
Property, net * | | | 3,702,236 | | | | 3,806,545 | |
Investment in Real Estate Joint Ventures and Partnerships, net | | | 341,608 | | | | 347,526 | |
| | | | | | | | |
Total | | | 4,043,844 | | | | 4,154,071 | |
Notes Receivable from Real Estate Joint Ventures and Partnerships | | | 149,204 | | | | 184,788 | |
Unamortized Debt and Lease Costs, net | | | 115,191 | | | | 116,437 | |
Accrued Rent and Accounts Receivable (net of allowance for doubtful accounts of $11,301 in 2011 and $10,137 in 2010) * | | | 86,530 | | | | 95,859 | |
Cash and Cash Equivalents * | | | 13,642 | | | | 23,859 | |
Restricted Deposits and Mortgage Escrows | | | 11,144 | | | | 10,208 | |
Other, net | | | 168,671 | | | | 222,633 | |
| | | | | | | | |
Total Assets | | $ | 4,588,226 | | | $ | 4,807,855 | |
| | | | | | | | |
| | |
| LIABILITIES AND EQUITY | | | | | | | | |
Debt, net * | | $ | 2,531,837 | | | $ | 2,589,448 | |
Accounts Payable and Accrued Expenses | | | 124,888 | | | | 126,767 | |
Other, net | | | 107,919 | | | | 111,383 | |
| | | | | | | | |
Total Liabilities | | | 2,764,644 | | | | 2,827,598 | |
| | | | | | | | |
| | |
Commitments and Contingencies | | | | | | | | |
| | |
Equity: | | | | | | | | |
Shareholders' Equity: | | | | | | | | |
Preferred Shares of Beneficial Interest—par value, $.03 per share; shares authorized: 10,000 | | | | | | | | |
6.75% Series D cumulative redeemable preferred shares of beneficial interest; 100 shares issued and outstanding in 2011 and 2010; liquidation preference $75,000 | | | 3 | | | | 3 | |
6.95% Series E cumulative redeemable preferred shares of beneficial interest; 29 shares issued and outstanding in 2011 and 2010; liquidation preference $72,500 | | | 1 | | | | 1 | |
6.5% Series F cumulative redeemable preferred shares of beneficial interest; 140 shares issued and outstanding in 2011 and 2010; liquidation preference $350,000 | | | 4 | | | | 4 | |
Common Shares of Beneficial Interest—par value, $.03 per share;
shares authorized: 275,000; shares issued and outstanding: | | | | | | | | |
120,844 in 2011 and 120,492 in 2010 | | | 3,641 | | | | 3,630 | |
Accumulated Additional Paid-In Capital | | | 1,983,978 | | | | 1,969,905 | |
Net Income Less Than Accumulated Dividends | | | (304,504) | | | | (151,780) | |
Accumulated Other Comprehensive Loss | | | (27,743) | | | | (21,774) | |
| | | | | | | | |
Total Shareholders' Equity | | | 1,655,380 | | | | 1,799,989 | |
Noncontrolling Interests | | | 168,202 | | | | 180,268 | |
| | | | | | | | |
Total Equity | | | 1,823,582 | | | | 1,980,257 | |
| | | | | | | | |
Total Liabilities and Equity | | $ | 4,588,226 | | | $ | 4,807,855 | |
| | | | | | | | |
|
* Consolidated Variable Interest Entities' Assets and Liabilities included in the above balances (See Note 22): | |
Property, net | | $ | 230,159 | | | $ | 233,706 | |
Accrued Rent and Accounts Receivable, net | | | 8,564 | | | | 9,514 | |
Cash and Cash Equivalents | | | 11,382 | | | | 10,397 | |
Debt, net | | | 279,301 | | | | 281,519 | |
WEINGARTEN REALTY INVESTORS CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In thousands) |
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Net Income | $ | 307,579 |
| | $ | 265,156 |
| | $ | 152,421 |
|
| Other Comprehensive (Loss) Income: | | | | | |
| Net unrealized gain on investments, net of taxes | 354 |
| | 340 |
| | — |
|
| Realized gain on investments | (38 | ) | | — |
| | — |
|
| Realized gain on derivatives | — |
| | 5,893 |
| | — |
|
| Net unrealized gain (loss) on derivatives | 131 |
| | 530 |
| | (123 | ) |
| Amortization of loss on derivatives and designated hedges | 2,052 |
| | 2,299 |
| | 2,650 |
|
| Retirement liability adjustment | (10,733 | ) | | 11,479 |
| | 473 |
|
| Total | (8,234 | ) | | 20,541 |
| | 3,000 |
|
| Comprehensive Income | 299,345 |
| | 285,697 |
| | 155,421 |
|
| Comprehensive Income Attributable to Noncontrolling Interests | (19,571 | ) | | (44,894 | ) | | (5,781 | ) |
| Comprehensive Income Adjusted for Noncontrolling Interests | $ | 279,774 |
| | $ | 240,803 |
| | $ | 149,640 |
|
See Notes to Consolidated Financial Statements.
WEINGARTEN REALTY INVESTORSCONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
Cash Flows from Operating Activities: | | | | | | | | | | | | |
Net Income | | $ | 16,739 | | | $ | 51,238 | | | $ | 175,276 | |
Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | | | | | | |
Depreciation and amortization | | | 157,290 | | | | 151,107 | | | | 151,888 | |
Amortization of deferred financing costs and debt discount | | | 5,215 | | | | 5,017 | | | | 6,083 | |
Impairment loss | | | 75,874 | | | | 33,317 | | | | 38,836 | |
Equity in earnings of real estate joint ventures and partnerships, net | | | (7,834) | | | | (12,889) | | | | (5,548) | |
Gain on acquisition | | | (4,559) | | | | - | | | | - | |
Gain on land and merchant development sales | | | - | | | | - | | | | (18,688) | |
Gain on sale of property | | | (11,952) | | | | (3,098) | | | | (81,031) | |
Loss (gain) on redemption of convertible senior unsecured notes | | | - | | | | 135 | | | | (25,311) | |
Distributions of income from real estate joint ventures and partnerships, net | | | 2,186 | | | | 1,733 | | | | 2,841 | |
Changes in accrued rent and accounts receivable, net | | | 6,662 | | | | (2,898) | | | | (568) | |
Changes in other assets, net | | | (22,482) | | | | (16,225) | | | | (10,309) | |
Changes in accounts payable, accrued expenses and other liabilities, net | | | (13,525) | | | | (3,875) | | | | 147 | |
Other, net | | | 11,117 | | | | 11,063 | | | | 10,700 | |
| | | | | | | | | | | | |
Net cash provided by operating activities | | | 214,731 | | | | 214,625 | | | | 244,316 | |
| | | | | | | | | | | | |
| | | |
Cash Flows from Investing Activities: | | | | | | | | | | | | |
Investment in property | | | (143,988) | | | | (142,972) | | | | (108,914) | |
Proceeds from sale and disposition of property, net | | | 113,043 | | | | 29,064 | | | | 333,412 | |
Change in restricted deposits and mortgage escrows | | | (794) | | | | 2,175 | | | | 20,480 | |
Notes receivable from real estate joint ventures and partnerships and other receivables: | | | | | | | | | | | | |
Advances | | | (2,926) | | | | (9,145) | | | | (100,800) | |
Collections | | | 15,687 | | | | 20,010 | | | | 22,301 | |
Real estate joint ventures and partnerships: | | | | | | | | | | | | |
Investments | | | (18,583) | | | | (37,738) | | | | (5,247) | |
Distributions of capital | | | 17,271 | | | | 15,663 | | | | 30,640 | |
Proceeds from tax increment revenue bonds | | | 16,545 | | | | - | | | | - | |
Other, net | | | - | | | | 1,522 | | | | - | |
| | | | | | | | | | | | |
Net cash (used in) provided by investing activities | | | (3,745) | | | | (121,421) | | | | 191,872 | |
| | | | | | | | | | | | |
| | | |
Cash Flows from Financing Activities: | | | | | | | | | | | | |
Proceeds from issuance of: | | | | | | | | | | | | |
Debt | | | 215,750 | | | | 336 | | | | 367,640 | |
Common shares of beneficial interest, net | | | 3,999 | | | | 3,122 | | | | 439,272 | |
Principal payments of debt | | | (336,760) | | | | (139,722) | | | | (578,390) | |
Changes in unsecured revolving credit facilities | | | 86,500 | | | | 80,000 | | | | (383,000) | |
Common and preferred dividends paid | | | (165,721) | | | | (158,012) | | | | (168,583) | |
Debt issuance costs paid | | | (4,002) | | | | (6,622) | | | | (6,446) | |
Distributions to noncontrolling interests | | | (23,560) | | | | (13,014) | | | | (16,368) | |
Contributions from noncontrolling interests | | | 3,717 | | | | 2,686 | | | | 4,518 | |
Other, net | | | (1,126) | | | | 8,297 | | | | (193) | |
| | | | | | | | | | | | |
Net cash used in financing activities | | | (221,203) | | | | (222,929) | | | | (341,550) | |
| | | | | | | | | | | | |
| | | |
Net (decrease) increase in cash and cash equivalents | | | (10,217) | | | | (129,725) | | | | 94,638 | |
Cash and cash equivalents at January 1 | | | 23,859 | | | | 153,584 | | | | 58,946 | |
| | | | | | | | | | | | |
Cash and cash equivalents at December 31 | | $ | 13,642 | | | $ | 23,859 | | | $ | 153,584 | |
| | | | | | | | | | | | |
| | | |
Interest paid during the period (net of amount capitalized of $2,329, $3,405 and $8,716, respectively) | | $ | 137,758 | | | $ | 140,335 | | | $ | 156,517 | |
| | | | | | | | | | | | |
Income taxes paid during the period | | $ | 1,578 | | | $ | 2,116 | | | $ | 3,051 | |
| | | | | | | | | | | | |
WEINGARTEN REALTY INVESTORS CONSOLIDATED BALANCE SHEETS (In thousands, except per share amounts) |
| | | | | | | |
| | December 31, |
| | 2014 | | 2013 |
| ASSETS | | | |
| Property | $ | 4,076,094 |
| | $ | 4,289,276 |
|
| Accumulated Depreciation | (1,028,619 | ) | | (1,058,040 | ) |
| Property Held for Sale, net | 3,670 |
| | 122,614 |
|
| Property, net * | 3,051,145 |
| | 3,353,850 |
|
| Investment in Real Estate Joint Ventures and Partnerships, net | 257,156 |
| | 266,158 |
|
| Total | 3,308,301 |
| | 3,620,008 |
|
| Notes Receivable from Real Estate Joint Ventures and Partnerships | — |
| | 13,330 |
|
| Unamortized Debt and Lease Costs, net | 141,122 |
| | 164,828 |
|
Accrued Rent and Accounts Receivable (net of allowance for doubtful
accounts of $7,680 in 2014 and $9,386 in 2013) * | 77,781 |
| | 82,351 |
|
| Cash and Cash Equivalents * | 23,189 |
| | 91,576 |
|
| Restricted Deposits and Mortgage Escrows | 79,998 |
| | 4,502 |
|
| Other, net | 183,703 |
| | 247,334 |
|
| Total Assets | $ | 3,814,094 |
| | $ | 4,223,929 |
|
| LIABILITIES AND EQUITY | | | |
| Debt, net * | $ | 1,938,188 |
| | $ | 2,299,844 |
|
| Accounts Payable and Accrued Expenses | 112,479 |
| | 108,535 |
|
| Other, net | 124,484 |
| | 127,572 |
|
| Total Liabilities | 2,175,151 |
| | 2,535,951 |
|
| Commitments and Contingencies | — |
| | — |
|
| Equity: | | | |
| Shareholders' Equity: | | | |
Preferred Shares of Beneficial Interest - par value, $.03 per share; shares authorized: 10,000 | | | |
6.5% Series F cumulative redeemable preferred shares of beneficial interest;
140 shares issued; 60 shares outstanding in 2014 and 2013; liquidation
preference $150,000 in 2014 and 2013 | 2 |
| | 2 |
|
Common Shares of Beneficial Interest - par value, $.03 per share;
shares authorized: 275,000; shares issued and outstanding:
122,489 in 2014 and 121,949 in 2013 | 3,700 |
| | 3,683 |
|
| Additional Paid-In Capital | 1,706,880 |
| | 1,679,229 |
|
| Net Income Less Than Accumulated Dividends | (212,960 | ) | | (300,537 | ) |
| Accumulated Other Comprehensive Loss | (12,436 | ) | | (4,202 | ) |
| Total Shareholders' Equity | 1,485,186 |
| | 1,378,175 |
|
| Noncontrolling Interests | 153,757 |
| | 309,803 |
|
| Total Equity | 1,638,943 |
| | 1,687,978 |
|
| Total Liabilities and Equity | $ | 3,814,094 |
| | $ | 4,223,929 |
|
| * Consolidated variable interest entities' assets held as collateral and debt included in the above balances (see Note 22): |
| Property, net | $ | 47,085 |
| | $ | 70,734 |
|
| Accrued Rent and Accounts Receivable, net | 2,576 |
| | 2,855 |
|
| Cash and Cash Equivalents | 12,189 |
| | 6,548 |
|
| Debt, net | 97,362 |
| | 109,923 |
|
See Notes to Consolidated Financial Statements.
WEINGARTEN REALTY INVESTORSCONSOLIDATED STATEMENTS OF EQUITY
(In thousands, except per share amounts)
Year Ended December 31, 2011, 2010 and 2009
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Preferred
Shares of
Beneficial
Interest | | | Common
Shares of
Beneficial
Interest | | | Accumulated
Additional
Paid-In
Capital | | | Net Income
Less Than
Accumulated
Dividends | | | Accumulated
Other
Comprehensive
Loss | | | Noncontrolling
Interests | | | Total | |
Balance, January 1, 2009 | | $ | 8 | | | $ | 2,625 | | | $ | 1,514,940 | | | $ | (37,245) | | | $ | (29,676) | | | $ | 204,031 | | | $ | 1,654,683 | |
Net income | | | | | | | | | | | | | | | 171,102 | | | | | | | | 4,174 | | | | 175,276 | |
Shares issued in exchange for noncontrolling interests | | | | | | | 15 | | | | 14,236 | | | | | | | | | | | | (14,251) | | | | - | |
Issuance of common shares | | | | | | | 966 | | | | 438,089 | | | | | | | | | | | | | | | | 439,055 | |
Shares issued under benefit plans | | | | | | | 9 | | | | 5,147 | | | | | | | | | | | | | | | | 5,156 | |
Dividends declared – common shares (1) | | | | | | | | | | | | | | | (135,731) | | | | | | | | | | | | (135,731) | |
Dividends declared – preferred shares (2) | | | | | | | | | | | | | | | (32,852) | | | | | | | | | | | | (32,852) | |
Sale of properties with noncontrolling interests | | | | | | | | | | | | | | | | | | | | | | | 23,521 | | | | 23,521 | |
Distributions to noncontrolling interests | | | | | | | | | | | | | | | | | | | | | | | (16,368) | | | | (16,368) | |
Contributions from noncontrolling interests | | | | | | | | | | | | | | | | | | | | | | | 4,518 | | | | 4,518 | |
Purchase and cancellation of convertible senior unsecured notes | | | | | | | | | | | (16,110) | | | | | | | | | | | | | | | | (16,110) | |
Other comprehensive income | | | | | | | | | | | | | | | | | | | 5,718 | | | | | | | | 5,718 | |
Other, net | | | | | | | | | | | 2,673 | | | | (2,624) | | | | | | | | (259) | | | | (210) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance, December 31, 2009 | | | 8 | | | | 3,615 | | | | 1,958,975 | | | | (37,350) | | | | (23,958) | | | | 205,366 | | | | 2,106,656 | |
Net income | | | | | | | | | | | | | | | 46,206 | | | | | | | | 5,032 | | | | 51,238 | |
Shares issued in exchange for noncontrolling interests | | | | | | | 1 | | | | 745 | | | | | | | | | | | | (746) | | | | - | |
Shares issued under benefit plans | | | | | | | 14 | | | | 8,005 | | | | | | | | | | | | | | | | 8,019 | |
Dividends declared – common shares (1) | | | | | | | | | | | | | | | (125,160) | | | | | | | | | | | | (125,160) | |
Dividends declared – preferred shares (2) | | | | | | | | | | | | | | | (32,852) | | | | | | | | | | | | (32,852) | |
Distributions to noncontrolling interests | | | | | | | | | | | | | | | | | | | | | | | (13,014) | | | | (13,014) | |
Contributions from noncontrolling interests | | | | | | | | | | | | | | | | | | | | | | | 2,686 | | | | 2,686 | |
Consolidation of joint ventures | | | | | | | | | | | | | | | | | | | | | | | (18,573) | | | | (18,573) | |
Other comprehensive income | | | | | | | | | | | | | | | | | | | 2,184 | | | | | | | | 2,184 | |
Other, net | | | | | | | | | | | 2,180 | | | | (2,624) | | | | | | | | (483) | | | | (927) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance, December 31, 2010 | | | 8 | | | | 3,630 | | | | 1,969,905 | | | | (151,780) | | | | (21,774) | | | | 180,268 | | | | 1,980,257 | |
Net income | | | | | | | | | | | | | | | 15,621 | | | | | | | | 1,118 | | | | 16,739 | |
Shares issued under benefit plans | | | | | | | 11 | | | | 9,898 | | | | | | | | | | | | | | | | 9,909 | |
Dividends declared – common shares (1) | | | | | | | | | | | | | | | (132,869) | | | | | | | | | | | | (132,869) | |
Dividends declared – preferred shares (2) | | | | | | | | | | | | | | | (32,852) | | | | | | | | | | | | (32,852) | |
Distributions to noncontrolling interests | | | | | | | | | | | | | | | | | | | | | | | (23,560) | | | | (23,560) | |
Contributions from noncontrolling interests | | | | | | | | | | | | | | | | | | | | | | | 13,666 | | | | 13,666 | |
Other comprehensive loss | | | | | | | | | | | | | | | | | | | (5,969) | | | | | | | | (5,969) | |
Other, net | | | | | | | | | | | 4,175 | | | | (2,624) | | | | | | | | (3,290) | | | | (1,739) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance, December 31, 2011 | | $ | 8 | | | $ | 3,641 | | | $ | 1,983,978 | | | $ | (304,504) | | | $ | (27,743) | | | $ | 168,202 | | | $ | 1,823,582 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
(1) | Common dividend per share was $1.10, $1.04 and $1.275 for the year ended December 31, 2011, 2010 and 2009, respectively.
|
(2) | Series D, E and F preferred dividend per share was $50.63, $173.75 and $162.50 for the year ended December 31, 2011, 2010 and 2009, respectively.
|
WEINGARTEN REALTY INVESTORS CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) |
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Cash Flows from Operating Activities: | | | | | |
| Net Income | $ | 307,579 |
| | $ | 265,156 |
| | $ | 152,421 |
|
| Adjustments to reconcile net income to net cash provided by operating activities: | | | | | |
| Depreciation and amortization | 150,616 |
| | 157,665 |
| | 148,413 |
|
| Amortization of debt deferred costs and intangibles, net | 3,641 |
| | (7,518 | ) | | (1,162 | ) |
| Impairment loss | 1,024 |
| | 2,815 |
| | 15,436 |
|
| Equity in (earnings) losses of real estate joint ventures and partnerships, net | (22,317 | ) | | (35,112 | ) | | 1,558 |
|
| Gain on acquisition | — |
| | — |
| | (1,869 | ) |
| Gain on sale and acquisition of real estate joint venture and partnership interests | (1,718 | ) | | (33,670 | ) | | (14,203 | ) |
| Gain on sale of property | (190,872 | ) | | (119,965 | ) | | (69,623 | ) |
| Distributions of income from real estate joint ventures and partnerships, net | 4,058 |
| | 3,498 |
| | 3,141 |
|
| Changes in accrued rent and accounts receivable, net | (3,494 | ) | | (4,606 | ) | | 82 |
|
| Changes in unamortized debt and lease costs and other assets, net | (16,299 | ) | | (19,587 | ) | | (19,008 | ) |
| Changes in accounts payable, accrued expenses and other liabilities, net | 2,890 |
| | 18,420 |
| | (878 | ) |
| Other, net | 5,661 |
| | 6,896 |
| | 13,022 |
|
| Net cash provided by operating activities | 240,769 |
| | 233,992 |
| | 227,330 |
|
| Cash Flows from Investing Activities: | | | | | |
| Acquisition of real estate and land | (43,587 | ) | | (105,765 | ) | | (198,171 | ) |
| Development and capital improvements | (100,926 | ) | | (76,992 | ) | | (95,743 | ) |
| Proceeds from sale of property and real estate equity investments, net | 351,224 |
| | 282,705 |
| | 591,091 |
|
| Change in restricted deposits and mortgage escrows | (75,299 | ) | | 39,505 |
| | (30,520 | ) |
| Notes receivable from real estate joint ventures and partnerships and other receivables - Advances | — |
| | (289 | ) | | (6,614 | ) |
| Notes receivable from real estate joint ventures and partnerships and other receivables - Collections | 10,336 |
| | 19,411 |
| | 75,081 |
|
| Real estate joint ventures and partnerships - Investments | (5,223 | ) | | (26,241 | ) | | (9,792 | ) |
| Real estate joint ventures and partnerships - Distributions of capital | 31,260 |
| | 59,932 |
| | 44,976 |
|
| Purchase of investments | (3,000 | ) | | (58,836 | ) | | — |
|
| Proceeds from investments | 51,788 |
| | — |
| | — |
|
| Other, net | 1,504 |
| | 1,224 |
| | — |
|
| Net cash provided by investing activities | 218,077 |
| | 134,654 |
| | 370,308 |
|
| Cash Flows from Financing Activities: | | | | | |
| Proceeds from issuance of debt | 4,500 |
| | 573,542 |
| | 300,098 |
|
| Principal payments of debt | (508,997 | ) | | (449,629 | ) | | (538,438 | ) |
| Changes in unsecured credit facilities | 189,000 |
| | (66,000 | ) | | (100,500 | ) |
| Proceeds from issuance of common shares of beneficial interest, net | 7,987 |
| | 5,968 |
| | 8,267 |
|
| Repurchase of preferred shares of beneficial interest | — |
| | (275,000 | ) | | (72,500 | ) |
| Common and preferred dividends paid | (199,343 | ) | | (165,900 | ) | | (173,202 | ) |
| Debt issuance costs paid | (463 | ) | | (6,716 | ) | | (4,250 | ) |
| Distributions to noncontrolling interests | (21,055 | ) | | (20,151 | ) | | (12,770 | ) |
| Contributions from noncontrolling interests | 980 |
| | 106,613 |
| | 2,123 |
|
| Other, net | 158 |
| | 599 |
| | (504 | ) |
| Net cash used in financing activities | (527,233 | ) | | (296,674 | ) | | (591,676 | ) |
| Net (decrease) increase in cash and cash equivalents | (68,387 | ) | | 71,972 |
| | 5,962 |
|
| Cash and cash equivalents at January 1 | 91,576 |
| | 19,604 |
| | 13,642 |
|
| Cash and cash equivalents at December 31 | $ | 23,189 |
| | $ | 91,576 |
| | $ | 19,604 |
|
| Interest paid during the period (net of amount capitalized of $3,302, $2,403 and $3,125, respectively) | $ | 91,277 |
| | $ | 106,918 |
| | $ | 117,085 |
|
| Income taxes paid during the period | $ | 1,705 |
| | $ | 1,860 |
| | $ | 1,548 |
|
See Notes to Consolidated Financial Statements.
WEINGARTEN REALTY INVESTORS
CONSOLIDATED STATEMENTS OF EQUITY
(In thousands)
Year Ended December 31, 2014, 2013 and 2012
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Preferred Shares of Beneficial Interest | | Common Shares of Beneficial Interest | | Additional Paid-In Capital | | Net Income Less Than Accumulated Dividends | | Accumulated Other Comprehensive Loss | | Noncontrolling Interests | | Total |
| Balance, January 1, 2012 | $ | 8 |
| | $ | 3,641 |
| | $ | 1,983,978 |
| | $ | (304,504 | ) | | $ | (27,743 | ) | | $ | 168,202 |
| | $ | 1,823,582 |
|
| Net income | | | | | | | 146,640 |
| | | | 5,781 |
| | 152,421 |
|
| Redemption of preferred shares | (1 | ) | | | | (69,999 | ) | | (2,500 | ) | | | | | | (72,500 | ) |
| Shares issued under benefit plans | | | 22 |
| | 16,568 |
| | | | | | | | 16,590 |
|
| Dividends paid – common shares | | | | | | | (140,686 | ) | | | | | | (140,686 | ) |
| Dividends paid – preferred shares | | | | | | | (32,516 | ) | | | | | | (32,516 | ) |
| Distributions to noncontrolling interests | | | | | | | | | | | (12,770 | ) | | (12,770 | ) |
| Contributions from noncontrolling interests | | | | | | | | | | | 2,123 |
| | 2,123 |
|
| Other comprehensive income | | | | | | | | | 3,000 |
| | | | 3,000 |
|
| Other, net | | | | | 3,636 |
| | (2,414 | ) | | | | (311 | ) | | 911 |
|
| Balance, December 31, 2012 | 7 |
| | 3,663 |
| | 1,934,183 |
| | (335,980 | ) | | (24,743 | ) | | 163,025 |
| | 1,740,155 |
|
| Net income | | | | | | | 220,262 |
| | | | 44,894 |
| | 265,156 |
|
| Redemption of preferred shares | (5 | ) | | | | (257,051 | ) | | (17,944 | ) | | | | | | (275,000 | ) |
| Shares issued under benefit plans | | | 20 |
| | 13,588 |
| | | | | | | | 13,608 |
|
| Dividends paid – common shares | | | | | | | (148,702 | ) | | | | | | (148,702 | ) |
| Dividends paid – preferred shares | | | | | | | (17,198 | ) | | | | | | (17,198 | ) |
| Distributions to noncontrolling interests | | | | | | | | | | | (20,151 | ) | | (20,151 | ) |
| Contributions from noncontrolling interests | | | | | | | | | | | 106,613 |
| | 106,613 |
|
| Acquisition of noncontrolling interests | | | | | (16,177 | ) | | | | | | 16,177 |
| | — |
|
| Other comprehensive income | | | | | | | | | 20,541 |
| | | | 20,541 |
|
| Other, net | | | | | 4,686 |
| | (975 | ) | | | | (755 | ) | | 2,956 |
|
| Balance, December 31, 2013 | 2 |
| | 3,683 |
| | 1,679,229 |
| | (300,537 | ) | | (4,202 | ) | | 309,803 |
| | 1,687,978 |
|
| Net income | | | | | | | 288,008 |
| | | | 19,571 |
| | 307,579 |
|
| Shares issued under benefit plans | | | 17 |
| | 15,881 |
| | | | | | | | 15,898 |
|
| Dividends paid – common shares | | | | | | | (189,591 | ) | | | | | | (189,591 | ) |
| Dividends paid – preferred shares | | | | | | | (9,752 | ) | | | | | | (9,752 | ) |
| Distributions to noncontrolling interests | | | | | | | | | | | (21,055 | ) | | (21,055 | ) |
| Contributions from noncontrolling interests | | | | | | | | | | | 980 |
| | 980 |
|
| Acquisition of noncontrolling interests | | | | | 11,015 |
| | | | | | (11,015 | ) | | — |
|
| Disposition of noncontrolling interests | | | | | | | | | | | (144,263 | ) | | (144,263 | ) |
| Other comprehensive loss | | | | | | | | | (8,234 | ) | | | | (8,234 | ) |
| Other, net | | | | | 755 |
| | (1,088 | ) | | | | (264 | ) | | (597 | ) |
| Balance, December 31, 2014 | $ | 2 |
| | $ | 3,700 |
| | $ | 1,706,880 |
| | $ | (212,960 | ) | | $ | (12,436 | ) | | $ | 153,757 |
| | $ | 1,638,943 |
|
See Notes to Consolidated Financial Statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies
Weingarten Realty Investors is a REIT organized under the Texas Real Estate Investment Trust Act, which has been replaced by the Texas Business Organizations Code. We currently operate, and intend to operate in the future, as a REIT.
We, and our predecessor entity, began the ownership and development of shopping centers and other commercial real estate in 1948.1948. Our primary business is leasing space to tenants in the shopping and industrial centers we own or lease. We also manage centersprovide property management services for which we charge fees to either joint ventures in whichwhere we are partners or for other outside owners for which we charge fees.owners.
We operate a portfolio of properties that include neighborhood and community shopping centers, and industrial propertiestotaling approximately 45.3 million square feet of approximately 76.1 million square feet.gross leaseable area, that is either owned by us or others. We have a diversified tenant base, with our largest tenant comprising only 3.2%3.5% of totalbase minimum rental revenues during 2011.We currently operate,
2014. Net operating income from continuing operations generated by our properties located in Houston and intend to operateits surrounding areas was 19.7% of total net operating income from continuing operations for the year ended December 31, 2014, and an additional 9.8% of net operating income from continuing operations was generated in the future, as a REIT.2014 from properties that are located in other parts of Texas. Our consolidated financial statements include the accounts of our subsidiaries, certain partially owned real estate joint ventures or partnerships and VIEs which meet the guidelines for consolidation. All intercompany balances and transactions have been eliminated.
Our
consolidated financial statements are prepared in accordance with GAAP. Such statements require management to make estimates and assumptions that affect the reported amounts on our consolidated financial statements. Actual results could differ from these estimates. We have evaluated subsequent events for recognition or disclosure in our consolidated financial statements.
Rental revenue is generally recognized on a straight-line basis over the term of the lease, which generally begins the date the tenant takes control of the space. Revenue from tenant reimbursements of taxes, maintenance expenses and insurance is subject to our interpretation of lease provisions and is recognized in the period the related expense is recognized. Revenue based on a percentage of tenants’ sales is recognized only after the tenant exceeds their sales breakpoint. In circumstances where we provide a tenant improvement allowance for improvements that are owned by the tenant, we recognize the allowance as a reduction of rental revenue on a straight-line basis over the term of the lease. Other revenue is income from contractual agreements with third parties, tenants or partially owned real estate joint ventures or partnerships, which is recognized as the related services are performed under the respective agreements.
Property
PropertyReal estate assets are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method, generally over estimated useful lives of 18-4018-40 years for buildings and 10-2010-20 years for parking lot surfacing and equipment. Major replacements where the betterment extends the useful life of the asset are capitalized and the replaced asset and corresponding accumulated depreciation are removed from the accounts. All other maintenance and repair items are charged to expense as incurred.
Acquisitions of properties are accounted for utilizing the acquisition method and, accordingly, the results of operations of an acquired property are included in our results of operations from the date of acquisition. Estimates of fair values are based upon
estimated future cash flows and other valuation techniques in accordance with our fair value measurements accounting policy. Fair values are used to
allocate and record the purchase price of acquired property among land, buildings on an “as if vacant” basis, tenant improvements, other identifiable intangibles and any goodwill or gain on purchase. Other identifiable intangible assets and liabilities include the effect of out-of-market leases, the value of having leases in place (“as is” versus “as if vacant” and absorption costs), out-of-market assumed mortgages and tenant relationships. Depreciation and amortization is computed using the straight-line method, generally over estimated useful lives of 40 years for buildings and over the lease term which includes bargain renewal options for other identifiable intangible assets. Acquisition costs are expensed as incurred.
Property also includes costs incurred in the development and redevelopment of new operating properties. These properties are carried at cost, and no depreciation is recorded on these assets until rent commences or no later than one year from the completion of major construction.construction. These costs include preacquisition costs directly identifiable with the specific project, development and construction costs, interest and real estate taxes. Indirect development costs, including salaries and benefits, travel and other related costs that are directly attributable to the development of the property, are also capitalized. The capitalization of such costs ceases at the earlier of one year from the completion of major construction or when the property, or any completed portion, becomes available for occupancy. Property also includes costs for tenant improvements paid by us, including reimbursements to tenants for improvements that are owned by us and will remain our property after the lease expires.
Property identified for sale is reviewed to determine if it qualifies as held for sale based on the following criteria: management has approved and is committed to the disposal plan, the assets are available for immediate sale, an active plan is in place to locate a buyer, the sale is probable and expected to qualify as a completed sale within a year, the sales price is reasonable in relation to the current fair value, and it is unlikely that significant changes will be made to the sales plan or that the sales plan will be withdrawn. Upon qualification, these properties are segregated and classified as held for sale at the lower of cost or fair value less costs to
sell andsell. Prior to April 1, 2014, the disposed property's related operating results were reclassified into discontinued operations.
Upon the adoption of new guidance as of April 1, 2014, our individual property disposals no longer qualified for discontinued operations presentation; thus, the results of these disposals remain in income from continuing operations and any associated gains are included in gain on sale of property.
Some of our properties are held in single purpose entities. A single purpose entity is a legal entity typically established at the request of a lender solely for the purpose of owning a property or group of properties subject to a mortgage. There may be restrictions limiting the entity’s ability to engage in an activity other than owning or operating the property, assuming or guaranteeing the debt of any other entity, or dissolving itself or declaring bankruptcy before the debt has been repaid. Most of our single purpose entities are 100% owned by us and are consolidated in our consolidated financial statements.
Real Estate Joint Ventures and Partnerships
To determine the method of accounting for partially owned real estate joint ventures and partnerships, management determines whether an entity is a VIE and, if so, determines which party is the primary beneficiary by analyzing whether we have both the power to direct the entity’s significant economic activities and the obligation to absorb potentially significant losses or receive potentially significant benefits. Significant judgments and assumptions inherent in this analysis include the design of the entity structure, the nature of the entity’s operations, future cash flow projections, the entity’s financing and capital structure, and contractual relationships and terms. We consolidate a VIE when we have determined that we are the primary beneficiary.
Primary risks associated with our involvement with our VIEs include
primarily the potential
funding of
funding the entities’ debt obligations or making additional contributions to fund the entities’ operations.
Partially owned,
non variablenon-variable interest real estate joint ventures and partnerships over which we have a controlling financial interest are consolidated in our consolidated financial statements. In determining if we have a controlling financial interest, we consider factors such as ownership interest, authority to make decisions, kick-out rights and substantive participating rights. Partially owned real estate joint ventures and partnerships where we do not have a controlling financial interest, but have the ability to exercise significant influence, are accounted for using the equity method.
Management continually analyzes and assesses reconsideration events, including changes in the factors mentioned above, to determine if the consolidation
or equity method treatment remains appropriate.
Notes Receivable from Real Estate Joint Ventures and Partnerships
Notes receivable from real estate joint ventures and partnerships in which we
havehad an ownership interest, primarily
representrepresented mortgage construction notes. We
considerconsidered applying a reserve to a note receivable when it
becomesbecame apparent that conditions
existexisted that may lead to our inability to fully collect on outstanding amounts due. Such conditions
includeincluded delinquent or late payments on notes, deterioration in the ongoing relationship with the borrower and other relevant factors. When such conditions leading to expected losses
exist,existed, we would estimate a reserve by reviewing the borrower’s ability to meet scheduled debt service, our partner’s ability to make contributions and the fair value of the collateral.
Debt
financing costs are amortized primarily on a straight-line basis, which approximates the effective interest method, over the terms of the debt. Lease costs represent the initial direct costs incurred in origination, negotiation and processing of a lease agreement. Such costs include outside broker commissions and other independent third party costs, as well as salaries and benefits, travel and other internal costs directly related to completing a lease and are amortized over the life of the lease on a straight-line basis. Costs related to supervision, administration, unsuccessful origination efforts and other activities not directly related to completed lease agreements are charged to expense as incurred.
Accrued Rent and Accounts Receivable, net
Receivables include base rents, tenant reimbursements and receivables attributable to the straight-lining of rental commitments. An allowance for the uncollectible portion of accrued rents and accounts receivable is determined based upon an analysis of balances outstanding, historical bad debt levels, tenant creditworthiness and current economic trends. Additionally, estimates of the expected recovery of pre-petition and post-petition claims with respect to tenants in bankruptcy are considered in assessing the collectibility of the related receivables. Management’s estimate of the collectibility of accrued rents and accounts receivable is based on the best information available to management at the time of evaluation.
Cash and Cash Equivalents
All highly liquid investments with original maturities of three months or less are considered cash equivalents. Cash and cash equivalents are primarily held at major financial institutions in the U.S. We had cash and cash equivalents in certain financial institutions in excess of federally insured levels. We have diversified our cash and cash equivalents amongst several banking institutions in an attempt to minimize exposure to any one of these entities. We believe we are not exposed to any significant credit risk and regularly monitor the financial stability of these financial institutions.
Restricted Deposits and Mortgage Escrows
Restricted deposits and mortgage escrows consist of escrow deposits held by lenders primarily for property taxes, insurance and replacement reserves and restricted cash that is held for a specific use or in a qualified escrow account for the purposes of completing like-kind exchange transactions.
Our restricted deposits and mortgage escrows consists of the following (in thousands):
| | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
| | |
Restricted cash | | $ | 3,169 | | | $ | 1,785 | |
Mortgage escrows | | | 7,975 | | | | 8,423 | |
| | | | | | | | |
| | |
Total | | $ | 11,144 | | | $ | 10,208 | |
| | | | | | | | |
|
| | | | | | | |
| | December 31, |
| | 2014 | | 2013 |
Restricted cash (1) | $ | 77,739 |
| | $ | 869 |
|
| Mortgage escrows | 2,259 |
| | 3,633 |
|
| Total | $ | 79,998 |
| | $ | 4,502 |
|
___________________
| |
| (1) | The increase between the periods presented is primarily attributable to $77.4 million placed in a qualified escrow account for the purpose of completing like-kind exchange transactions. |
Other assets include an asset related to the debt service guaranty (see Note 7 for further information), tax increment revenue bonds, investments,
investments held in
a grantor
trusts,trust, deferred tax assets, prepaid expenses, interest rate derivatives, the value of above-market leases and the related accumulated amortization and other miscellaneous receivables. Investments held in
a grantor
truststrust and investments in mutual funds are adjusted to fair value at each period
end with changes included in our Consolidated Statements of
OperationsOperations. The value of our investments in mutual funds approximates the cost basis. Investments held to maturity are carried at amortized cost and
Comprehensive Income.are adjusted using the interest method for amortization of premiums and accretion of discounts. Our tax increment revenue bonds have been classified as held to maturity and are recorded at amortized cost offset by a recognized credit loss (see Note 24 for further information). Above-market leases are amortized as adjustments to rental revenues over terms of the acquired leases. Other miscellaneous receivables have a reserve applied to the carrying amount when it becomes apparent that conditions exist that may lead to our inability to fully collect on outstanding amounts due. Such conditions include delinquent or late payments on receivables, deterioration in the ongoing relationship with the borrower and other relevant factors. We would establish a reserve when expected loss conditions exist by reviewing the borrower’s ability to generate revenues to meet debt service requirements and
assessing the fair value of any collateral.
We manage interest cost using a combination of fixed-rate and variable-rate debt. To manage our interest rate risk, we occasionally hedge the future cash flows of our
existing floating-rate debt
transactions,or anticipated fixed-rate debt issuances, as well as changes in the fair value of our
existing fixed-rate debt instruments, principally through interest rate contracts with major financial institutions. Interest rate contracts that meet specific criteria are accounted for as either a cash flow or fair value hedge.
Cash Flow Hedges of Interest Rate Risk:
Our objective in using interest rate contracts is to add stability to interest expense and to manage our exposure to interest rate movements. To accomplish this objective, we primarily use interest rate
swap and/or cap contracts as part of our interest rate risk management strategy. Interest rate contracts designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for us making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount or capping floating rate interest payments.
The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive loss and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. For hedges of fixed-rate debt issuances, the interest rate contracts are cash settled upon the pricing of the debt, with amounts deferred in accumulated other comprehensive loss and amortized as an increase/decrease to interest expense over the originally hedged period.
The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings.
Fair Value Hedges of Interest Rate Risk:
We are exposed to changes in the fair value of certain of our fixed-rate obligations due to changes in benchmark interest rates, such as LIBOR. We use interest rate contracts to manage our exposure to changes in fair value on these instruments attributable to changes in the benchmark interest rate. Interest rate contracts designated as fair value hedges involve the receipt of fixed-rate amounts from a counterparty in exchange for us making variable-rate payments over the life of the agreements without the exchange of the underlying notional amount. Changes in the fair value of interest rate contracts designated as fair value hedges, as well as changes in the fair value of the related debt being hedged, are recorded in earnings each reporting period.
Sales of real estate include the sale of tracts of land within a shopping center development, property adjacent to shopping centers, operating properties, newly developed properties, investments in real estate joint ventures and partnerships and partial sales to real estate joint ventures and partnerships in which we participate.
Profits on sales of real estate are not recognized until (a) a sale is consummated; (b) the buyer’s initial and continuing investments are adequate to demonstrate a commitment to pay; (c) the seller’s receivable is not subject to future subordination; and (d) we have transferred to the buyer the usual risks and rewards of ownership in the transaction, and we do not have a substantial continuing involvement with the property.
We recognize gains on the sale of real estate to joint ventures and partnerships in which we participate to the extent we receive cash from the joint venture or partnership, if it meets the sales criteria in accordance with GAAP, and we do not have a commitment to support the operations of the real estate joint venture or partnership to an extent greater than our proportionate interest in the real estate joint venture or partnership.
Our property is reviewed for impairment if events or changes in circumstances indicate that the carrying amount of the property, including any capitalized costs and any identifiable intangible assets, may not be recoverable.
If such an event occurs, a comparison is made of the current and projected operating cash flows of each such property into the foreseeable future, with consideration of applicable holding periods, on an undiscounted basis to the carrying amount of such property. If we determine the carrying amount is not recoverable, our basis in the property is reduced to its estimated fair value to reflect impairment in the value of the asset. Fair values are determined by management utilizing cash flow models, market capitalization rates and market discount rates, or by obtaining third-party broker or appraisal estimates in accordance with our fair value measurements accounting policy.
We
continuously review economic considerations at each reporting period, including the effects of tenant bankruptcies, the suspension of tenant expansion plans for new development projects, declines in real estate values, and any changes to plans related to our new development properties including land held for development, to identify properties where we believe market values may be deteriorating. Determining whether a property is impaired and, if impaired, the amount of write-down to fair value requires a significant amount of judgment by management and is based on the best information available to management at the time of evaluation. If market conditions deteriorate or management’s plans for certain properties change, additional write-downs could be required in the future.
Our investment in partially owned real estate joint ventures and partnerships is reviewed for impairment each reporting period. The ultimate realization is dependent on a number of factors, including the performance of each investment and market conditions. We will record an impairment charge if we determine that a decline in the estimated fair value of an investment below its carrying amount is other than temporary. There is no certainty that impairments will not occur in the future if market conditions decline or if management’s plans for these investments change.
Our investments in tax increment revenue bonds are reviewed for impairment, including the evaluation of changes in events or circumstances that may indicate that the carrying amount of the investment may not be recoverable. Realization is dependent on a number of factors, including investment performance, market conditions and payment structure. We will record an impairment charge if we determine that a decline in the value of the investment below its carrying amount is other than temporary, recovery of its cost basis is uncertain, and/or it is uncertain if the investment will be held to maturity.
As of December 31, 2011, the reissued tax increment revenue bonds have been classified as held to maturity.
Interest is capitalized on land under development and buildings under construction based on rates applicable to borrowings outstanding during the period and the weighted average balance of qualified assets under development/construction during the period.
Interest Expense in Discontinued Operations
Interest expense that is specifically identifiable to property, both held for sale and sold and qualifies as discontinued operations, is included in operating income from discontinued operations in our consolidated financial statements. We do not allocate other consolidated interest to operating income from discontinued operations because the interest savings to be realized from the proceeds of the sale of these operations is not material.
We have elected to be treated as a REIT under the Internal Revenue Code of 1986, as amended. As a REIT, we generally will not be subject to corporate level federal income tax on taxable income we distribute to our shareholders. To be taxed as a REIT, we must meet a number of requirements including defined percentage tests concerning the amount of our assets and revenues that come from, or are attributable to, real estate operations. As long as we distribute at least 90% of the taxable income of the REIT (without regard to capital gains or the dividends paid deduction) to our shareholders as dividends, we will not be taxed on the portion of our income we distribute as dividends unless we have ineligible transactions. The Tax Relief Extension Act of 1999 gave REITs the ability to conduct activities which a REIT was previously precluded from doing as long as such activities are performed in entities which have elected to be treated as taxable REIT subsidiaries under the IRS code. These activities include buying or developing properties with the express purpose of selling them. We conduct certain of these activities in
a taxable REIT
subsidiariessubsidiary that we have created. We calculate and record income taxes in our consolidated financial statements based on the activities in
those entities.this entity. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between our carrying amounts of existing assets and liabilities and their respective tax bases and
net operating loss and tax credit carry-forwards. These are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation allowance for deferred tax assets is established for those assets we do not consider the realization of such assets to be more likely than not.
Additionally, GAAP prescribes a recognition threshold and measurement attribute for the financial statement recognition of a tax position taken, or expected to be taken, in a tax return. A tax position may only be recognized in the consolidated financial statements if it is more likely than not that the tax position will be sustained upon examination. We believe it is more likely than not that our tax positions will be sustained in any tax examinations.
In addition, we are subject to the State of Texas business tax (“Texas Franchise Tax”), which is determined by applying a tax rate to a base that considers both revenues and expenses. Therefore, the Texas Franchise Tax is considered an income tax and is accounted for accordingly.
We sponsorhave share option and restricted share award plans. Currently,In November 2011, we announced changes to the long-term incentive program under our Amended and Restated 2010 Long-Term Incentive Plan ("2011 Program Changes"). Future grants of awards will incorporate both service-based and market-based measures for restricted share awards to promote share ownership among the participants and to emphasize the importance of total shareholder return. The terms of each grant vary depending upon the participant's responsibilities and position within the Company. All awards are recorded at fair value on the date of grant and earn dividends throughout the vesting period. Compensation expense is measured at the grant date and recognized over the vesting period. All share awards are awarded subject to the participant’s continued employment with us.
The share awards are subject to a three-year cliff vesting basis. Service-based and market-based share awards are subject to the achievement of select performance goals as follows:
Service-based awards and accumulated dividends typically vest three years from the grant date. These grants are subject only to continued employment and not dependent on future performance measures. Accordingly, if such vesting criteria are not met, compensation cost previously recognized would be reversed.
Market-based awards vest based upon the performance metrics at the end of a three-year period. These awards are based 50% on our three-year relative total shareholder return (“TSR”) as compared to the FTSE NAREIT U.S. Shopping Center Index. The other 50% is tied to our three-year absolute TSR. At the end of a three-year period, the performance measures are analyzed; the actual number of shares earned is determined and the earned shares and the accumulated dividends vest. The probability of meeting the market criteria is considered when calculating the estimated fair value on the date of grant using a Monte Carlo simulation. These awards are accounted for as awards with market criteria, with compensation cost recognized over the service period, regardless of whether the market criteria are achieved and the awards are ultimately earned and vest.
Share options granted to non-officers prior to the 2011 Program Changes vest ratably over a three-yearthree-year period beginning after the grant date, and share options and restricted shares for officers vest ratably over a five-yearfive-year period after the grant date. Restricted shares granted to trust managers and share options or awards granted to retirement eligible employees are expensed immediately. Restricted shares have the same rights of a common shareholder, including the right to vote and receive dividends, except as otherwise provided by our Management Development and Executive Compensation Committee. The grant price for our plansoptions is calculated as an average of the high and low of the quoted fair value of our common shares on the date of grant. These Issued options generally expire upon the earlier of termination of employment or 10 years from the date of grant, and restricted shares for officers and trust managers are granted at no purchase price.price. Our policy is to recognize compensation expense for equity awards ratably over the vesting period, except for retirement eligible amounts. The fair value of share options and restricted shares iswas estimated on the date of grant using the Black-Scholes option pricing method based on certain expected weighted average assumptions; including the dividend yield, the expected volatility, the expected life and the risk free interest rate. The dividend yield iswas an average of the historical yields at each record date over the estimated expected life. We estimateestimated volatility using our historical volatility data for a period of 10 years, and the expected life iswas based on historical data from an option valuation model of employee exercises and terminations. The risk-free rate iswas based on the U.S. Treasury yield curve.
Defined Benefit Plans:
We sponsor a noncontributory cash balance retirement plan (“Retirement Plan”) under which an account is maintained for each participant. Annual additions to each participant’s account include a service credit ranging from 3-5%3%-5% of compensation, depending on years of service, and an interest credit of 4.5% effective January 1, 2011. The interest credit for prior years was based on the 10 year U.S. Treasury Bill rate not to be less than 2.05%. Vesting generally occurs after three years of service. In addition to the plan described above, we have established two separate and independent nonqualified supplemental retirement plans (“SRP”) for certain employees. These unfunded plans provide benefits in excess
Investments of Plan
Assets:Assets
Our investment policy for our plan assets has been to determine the objectives for structuring a retirement savings program suitable to the long-term needs and risk tolerances of participants, to select appropriate investments to be offered by the plan and to establish procedures for monitoring and evaluating the performance of the investments of the plan. Our overall plan objectives for selecting and monitoring investment options are to promote and optimize retirement wealth accumulation; to provide a full range of asset classes and investment options that are intended to help diversify the portfolio to maximize return within reasonable and prudent levels of risk; to control costs of administering the plan; and to manage the investments held by the plan.
The selection of investment options is determined using criteria based on the following characteristics: fund history, relative performance, investment style, portfolio structure, manager tenure, minimum assets, expenses and operation considerations. Investment options selected for use in the plan are reviewed at least on a semi-annual basis to evaluate material changes from the selection criteria. Asset allocation is used to determine how the investment portfolio should be split between stocks, bonds and cash. The asset allocation decision is influenced by investment time horizon; risk tolerance; and investment return objectives. The primary factor in establishing asset allocation is demographics of the plan, including attained age and future service. A broad market diversification model is used in considering all these factors and the percentage allocation to each investment category may also vary depending upon market conditions.
RebalancingRe-balancing of the allocation of plan assets occurs semi-annually.
Defined Contribution Plans:
Effective January 1, 2012, we amended our two separate and independent nonqualified supplemental retirement plans (“SRP”) for certain employees to be defined contribution plans. These unfunded plans provide benefits in excess of the statutory limits of our noncontributory cash balance retirement plan. For active participants as of January 1, 2012, annual additions to each participant’s account include an actuarially-determined service credit ranging from 3% to 5% and an interest credit of 4.5%. Vesting generally occurs between five and 10 years of service. We have elected to use the actuarial present value of the vested benefits to which the participant was entitled if the participant separated immediately from the SRP, as permitted by GAAP.
The SRP participants' account balances, prior to January 1, 2012, were converted to a cash balance retirement plan which no longer receives service credits but continues to receive a 7.5% interest credit for active participants and a December 31 90-day LIBOR rate plus .50% for inactive participants.
We have a Savings and Investment Plan pursuant to which eligible employees may elect to contribute from 1% of their salaries to the maximum amount established annually by the IRS. Employee contributions are matched by us at the rate of 50% for the first 6% of the employee's salary. The employees vest in the employer contributions ratably over a five-year period.
Deferred Compensation Plan
We have a deferred compensation plan for eligible employees allowing them to defer portions of their current cash salary or share-based compensation. Deferred amounts are deposited in a grantor trust, which are included in
net other
net assets, and are reported as compensation expense in the year service is rendered. Cash deferrals are invested based on the employee’s investment selections from a mix of assets selected using a broad market diversification model. Deferred share-based compensation cannot be diversified, and distributions from this plan are made in the same form as the original deferral.
Certain financial instruments, estimates and transactions are required to be calculated, reported and/or recorded at fair value. The estimated fair values of such financial items, including debt instruments,
impairments,impaired assets, acquisitions, investment securities and derivatives, have been determined using a market-based measurement. This measurement is determined based on the assumptions that management believes market participants would use in pricing an asset or liability; including, market capitalization rates, discount rates, current operating income, local economics and other factors. As a basis for considering market participant assumptions in fair value measurements, GAAP establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).
Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, which is typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. The fair value of such financial instruments, estimates and transactions was determined using available market information and appropriate valuation methodologies as prescribed by GAAP.
Accumulated Other Comprehensive Loss
Internally developed and third party fair value measurements, including the unobservable inputs, are evaluated by management with sufficient experience for reasonableness based on current market knowledge, trends and transactional experience in the real estate and capital markets. Our
accumulated other comprehensive loss consists of the following (in thousands): | | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
| | |
Derivatives | | $ | 10,016 | | | $ | 11,713 | |
Retirement liability | | | 17,727 | | | | 10,061 | |
| | | | | | | | |
| | |
Total | | $ | 27,743 | | | $ | 21,774 | |
| | | | | | | | |
Reclassifications
The reclassification of prior years’ operating results for certain properties classified as discontinued operations was madevaluation policies and procedures are determined by our Accounting Group, which reports to the current year presentation. Also, in our Consolidated Statements of Cash Flows, prior years’ distribution to noncontrolling interests and contributions from noncontrolling interests was reclassified from other, net to conform to the current year presentation. These reclassifications had no impact on previously reported net income, earnings per share, the consolidated balance sheet or cash flows. See Note 15 for additional information.
Note 2. Newly Issued Accounting Pronouncements
In July 2010, the FASB issued Accounting Standards Update No. 2010-20, “Disclosures about the Credit Quality of Financing ReceivablesChief Financial Officer and the Allowance for Credit Losses,” which provides for additional disclosures about the credit qualityresults of an entity’s financing receivables, including loans and trade accounts receivable with contractual maturities exceeding one year and any related allowance for losses. The provisions of this update were effective for us at December 31, 2010,significant impairment transactions are discussed with the exception of disclosures related to activity occurring duringAudit Committee on a reporting period, which was effectivequarterly basis.
Fair value estimates are based on limited available market information for
us in the first quarter of 2011. The adoption did not materially impact our consolidated financial statements.In April 2011, the FASB issued Accounting Standards Update No. 2011-02, “A Creditor’s Determination of Whether a Restructuring Is a Troubled Debt Restructuring,” which amends previous guidance by further defining that a restructure is classified as a troubled debt restructuring when certain criteria are met. The provisions of this update were applied and effective for us at July 1, 2011. The adoption of this update did not materially impact our consolidated financial statements.
In May 2011, the FASB issued Accounting Standards Update No. 2011-04, “Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs,” which amends previous guidance resulting in common fair value measurement and disclosure requirements between GAAP and International Financial Reporting Standards. The amendments both clarify the application of existing fair value measurement requirements and changes certain principles or requirements for measuring fair value or for disclosing information about fair value measurements. The provisions of this update are effective for us at January 1, 2012. We do not anticipate the adoption of this update to materially impact our consolidated financial statements.
In June 2011, the FASB issued Accounting Standards Update No. 2011-05 (“ASU 2011-05”), “Presentation of Comprehensive Income,” which amends previous guidance by requiring all nonowner changes in shareholders’ equity to be presented in either a single continuous statement of comprehensive income or in two separate but consecutive statements. In addition, an entity will be required to present on the face of the financial statements, reclassification adjustments for items reclassified from other comprehensive income to net income. In December 2011, the FASB issued Accounting Standards Update No. 2011-12, “Deferral of Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05,” which primarily defers the provision of ASU 2011-05 requiring the presentation on the face of the financial statements other comprehensive income reclassification adjustments. All other provisions of ASU 2011-05 are effective for us at January 1, 2012. The early adoption of this update as of December 31, 2011 did not impact our consolidated financial statements.
In December 2011, the FASB issued Accounting Standards Update No. 2011-10, “Derecognition of in Substance Real Estate – A Scope Clarification,” which clarifies which guidance a reporting entity should follow when it deconsolidates a subsidiary that is in substance real estate as a result of a default on the subsidiary’s nonrecourse debt. The provisions of this update will be applied prospectively and are effective for us at June 15, 2012. We do not anticipate the adoption of this update to materially impact our consolidated financial statements.
Note 3. Property
Our property consisted of the following (in thousands):
| | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
| | |
Land | | | $ 918,627 | | | | $ 925,497 | |
Land held for development | | | 124,528 | | | | 170,213 | |
Land under development | | | 20,281 | | | | 22,967 | |
Buildings and improvements | | | 3,557,173 | | | | 3,610,889 | |
Construction in-progress | | | 67,917 | | | | 48,228 | |
| | | | | | | | |
| | |
Total | | | $ 4,688,526 | | | | $ 4,777,794 | |
| | | | | | | | |
The following carrying charges were capitalized (in thousands):
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
| | | |
Interest | | $ | 2,329 | | | $ | 3,405 | | | $ | 8,716 | |
Real estate taxes | | | 399 | | | | 344 | | | | 1,428 | |
| | | | | | | | | | | | |
| | | |
Total | | $ | 2,728 | | | $ | 3,749 | | | $ | 10,144 | |
| | | | | | | | | | | | |
During the year ended December 31, 2011, we invested $42.9 million in the acquisition of two operating properties and $30.9 million in new development projects.
During the year ended December 31, 2011, we sold eight retail properties, three industrial properties, a retail building and 11 undeveloped land parcels with aggregate gross sales proceeds from these dispositions totaling $117.2 million. Also, seven properties totaling $94.8 million before accumulated depreciation have been classified as held for sale as of December 31, 2011.
Note 4. Investment in Real Estate Joint Ventures and Partnerships
We own interests in real estate joint ventures or limited partnerships and have tenancy-in-common interests in which we exercise significant influence, but do not have financial and operating control. We account for these investments using the equity method, and our interests range from 7.8% to 75% for the periods presented. Combined condensed financial information of these ventures (at 100%) is summarized as follows (in thousands):
| | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
| | |
Combined Condensed Balance Sheets | | | | | | | | |
| | |
Property | | | $ 2,108,745 | | | | $ 2,142,524 | |
Accumulated depreciation | | | (296,496) | | | | (247,996) | |
| | | | | | | | |
Property, net | | | 1,812,249 | | | | 1,894,528 | |
| | |
Other assets, net | | | 173,130 | | | | 168,091 | |
| | | | | | | | |
Total | | | $ 1,985,379 | | | | $ 2,062,619 | |
| | | | | | | | |
| | |
Debt, net (primarily mortgages payable) | | | $ 556,920 | | | | $ 552,552 | |
Amounts payable to Weingarten Realty Investors and affiliates | | | 170,007 | | | | 202,092 | |
Other liabilities, net | | | 41,907 | | | | 45,331 | |
| | | | | | | | |
Total | | | 768,834 | | | | 799,975 | |
| | | | | | | | |
| | |
Accumulated equity | | | 1,216,545 | | | | 1,262,644 | |
| | | | | | | | |
| | |
Total | | | $ 1,985,379 | | | | $ 2,062,619 | |
| | | | | | | | |
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
| | | |
Combined Condensed Statements of Operations | | | | | | | | | | | | |
| | | |
Revenues, net | | $ | 205,596 | | | $ | 193,649 | | | $ | 174,595 | |
| | | | | | | | | | | | |
| | | |
Expenses: | | | | | | | | | | | | |
Depreciation and amortization | | | 67,459 | | | | 61,726 | | | | 56,018 | |
Interest, net | | | 37,612 | | | | 36,270 | | | | 31,017 | |
Operating | | | 36,253 | | | | 34,026 | | | | 33,385 | |
Real estate taxes, net | | | 24,333 | | | | 24,288 | | | | 21,213 | |
General and administrative | | | 2,969 | | | | 3,927 | | | | 5,187 | |
Provision for income taxes | | | 343 | | | | 237 | | | | 170 | |
Impairment loss | | | 28,776 | | | | 231 | | | | 6,923 | |
| | | | | | | | | | | | |
| | | |
Total | | | 197,745 | | | | 160,705 | | | | 153,913 | |
| | | |
(Loss) gain on sale of property | | | (21) | | | | 369 | | | | 11 | |
| | | | | | | | | | | | |
Net income | | $ | 7,830 | | | $ | 33,313 | | | $ | 20,693 | |
| | | | | | | | | | | | |
Our investment in real estate joint ventures and partnerships, as reported in our Consolidated Balance Sheets, differs from our proportionate share of the entities’ underlying net assets due to basis differences, which arose upon the transfer of assets to the joint ventures. The net basis differences, which totaled $7.5 million and $8.8 million at December 31, 2011 and 2010, respectively, are generally amortized over the useful lives of the related assets.
Our real estate joint ventures and partnerships determined that the carrying amount of certain properties was not recoverable and that the properties should be written down to fair value. For the year ended December 31, 2011, 2010 and 2009, our unconsolidated real estate joint ventures and partnerships recorded an impairment charge of $28.8 million, $.2 million and $6.9 million, respectively, associated primarily with shorter holding periods of finite life joint ventures where the joint ventures’ ability to recover the carrying cost of the property may be limited by the term of the venture life.
Fees earned by us for the management of these real estate joint ventures and partnerships totaled $6.0 million in 2011, $5.8 million in 2010 and $5.7 million in 2009.
During 2011, an unconsolidated real estate joint venture sold two industrial buildings with gross sales proceeds aggregating $7.6 million.
In April 2011, we acquired a 50%-owned unconsolidated real estate joint venture interest in three retail properties for approximately $11.6 million. We also acquired our partner’s 50% unconsolidated joint venture interest in a Florida development property that we had previously accounted for under the equity method. This transaction resulted in the consolidation of the property in our consolidated financial statements.
Effective April 1, 2010, we assumed control of two 50%-owned unconsolidated real estate joint ventures related to a development project in Sheridan, Colorado that we had previously accounted for under the equity method. This transaction resulted in the consolidation of the joint ventures in our consolidated financial statements.
During 2010, activity in our unconsolidated real estate joint ventures consisted of the sale of two retail buildings and two land parcels. In addition, we sold an unconsolidated real estate joint venture interest. Total aggregate gross sales proceeds for thesesimilar transactions, totaled $8.3 million.
Also, in the fourth quarter of 2010, we acquired interests in two unconsolidated real estate joint ventures for approximately $35.8 million.
Note 5. Notes Receivable from Real Estate Joint Ventures and Partnerships
We have ownership interests in a number of real estate joint ventures and partnerships. Notes receivable from these entities bear interest ranging from approximately 2.8% to 10.0% at December 31, 2011 and 2.0% to 12.0% at December 31, 2010. These notes are due at various dates through 2014 and are generally secured by underlying real estate assets. We believe these notes are fully collectible, and no allowance has been recorded. Interest income recognized on these notes was $3.4 million, $4.3 million and $4.8 million for the year ended December 31, 2011, 2010 and 2009, respectively.
In April 2011, we acquired our partner’s 50% unconsolidated joint venture interest in a Florida development property, which includes the settlement of $21.9 million of our notes receivable from real estate joint ventures and partnerships.
In February 2012, we received $59.1 million in settlement ofincluding our notes receivable from real estate joint ventures and partnerships, which were outstanding as of December 31, 2011, in conjunction with an assignment of our interest in an unconsolidated real estate joint venture. See Note 20 for additional information.
Note 6. Identified Intangible Assets and Liabilities
Identified intangible assets and liabilities associated with our property acquisitions are as follows (in thousands):
| | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
| | |
Identified Intangible Assets: | | | | | | | | |
Above-Market Leases (included in Other Assets, net) | | $ | 17,342 | | | $ | 16,825 | |
Above-Market Leases – Accumulated Amortization | | | (11,587) | | | | (10,507) | |
Below-Market Assumed Mortgages (included in Debt, net) | | | 5,722 | | | | 5,722 | |
Below-Market Assumed Mortgages – Accumulated Amortization | | | (1,762) | | | | (1,157) | |
Valuation of In Place Leases (included in Unamortized Debt and Lease Cost, net) | | | 74,361 | | | | 71,272 | |
Valuation of In Place Leases – Accumulated Amortization | | | (38,842) | | | | (35,984) | |
| | | | | | | | |
| | |
| | $ | 45,234 | | | $ | 46,171 | |
| | | | | | | | |
| | |
Identified Intangible Liabilities: | | | | | | | | |
Below-Market Leases (included in Other Liabilities, net) | | $ | 39,399 | | | $ | 37,668 | |
Below-Market Leases – Accumulated Amortization | | | (26,013) | | | | (23,585) | |
Above-Market Assumed Mortgages (included in Debt, net) | | | 45,670 | | | | 48,149 | |
Above-Market Assumed Mortgages – Accumulated Amortization | | | (31,597) | | | | (31,288) | |
| | | | | | | | |
| | |
| | $ | 27,459 | | | $ | 30,944 | |
| | | | | | | | |
These identified intangible assets and liabilities are amortized over the applicable lease terms or the remaining lives of the assumed mortgages, as applicable.
The net amortization of above-market and below-market leases increased rental revenues by $1.5 million, $1.7 million and $2.5 million in 2011, 2010 and 2009, respectively. The estimated net amortization of these intangible assets and liabilities will increase rental revenues for each of the next five years as follows (in thousands):
| | | | |
2012 | | $ | 832 | |
2013 | | | 951 | |
2014 | | | 629 | |
2015 | | | 596 | |
2016 | | | 581 | |
The amortization of the in place lease intangible assets recorded in depreciation and amortization, was $6.2 million, $5.9 million and $8.2 million in 2011, 2010 and 2009, respectively. The estimated amortization of this intangible asset will increase depreciation and amortization for each of the next five years as follows (in thousands):
| | | | |
2012 | | $ | 5,313 | |
2013 | | | 4,482 | |
2014 | | | 3,982 | |
2015 | | | 3,440 | |
2016 | | | 3,049 | |
The amortization of above-market and below-market assumed mortgages decreased net interest expense by $2.2 million, $3.1 million and $4.4 million in 2011, 2010 and 2009, respectively. The estimated amortization of these intangible assets and liabilities will decrease net interest expense for each of the next five years as follows (in thousands):
| | | | |
2012 | | $ | 689 | |
2013 | | | 465 | |
2014 | | | 500 | |
2015 | | | 513 | |
2016 | | | 626 | |
Note 7. Debt
Our debt consists of the following (in thousands):
| | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
| | |
Debt payable to 2038 at 1.5% to 8.8% | | $ | 2,268,668 | | | $ | 2,389,532 | |
Debt service guaranty liability | | | 74,075 | | | | 97,000 | |
Unsecured notes payable under revolving credit facilities | | | 166,500 | | | | 80,000 | |
Obligations under capital leases | | | 21,000 | | | | 21,000 | |
Industrial revenue bonds payable to 2015 at 2.4% | | | 1,594 | | | | 1,916 | |
| | | | | | | | |
| | |
Total | | $ | 2,531,837 | | | $ | 2,589,448 | |
| | | | | | | | |
The grouping of total debt between fixed and variable-rate as well as between secured and unsecured is summarized below (in thousands):
| | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
| | |
As to interest rate (including the effects of interest rate contracts): | | | | | | | | |
Fixed-rate debt | | $ | 2,014,834 | | | $ | 2,349,802 | |
Variable-rate debt | | | 517,003 | | | | 239,646 | |
| | | | | | | | |
| | |
Total | | $ | 2,531,837 | | | $ | 2,589,448 | |
| | | | | | | | |
As to collateralization: | | | | | | | | |
Unsecured debt | | $ | 1,510,932 | | | $ | 1,450,148 | |
Secured debt | | | 1,020,905 | | | | 1,139,300 | |
| | | | | | | | |
| | |
Total | | $ | 2,531,837 | | | $ | 2,589,448 | |
| | | | | | | | |
Effective September 30, 2011, we entered into an amended and restated $500 million unsecured revolving credit facility. The facility expires in September 2015, provides for a one-year extension upon our request and borrowing rates that float at a margin over LIBOR plus a facility fee. The borrowing margin and facility fee are priced off a grid that is tied to our senior unsecured credit ratings, which are currently 125.0 and 25.0 basis points, respectively. The facility also contains a competitive bid feature that will allow us to request bids for up to $250 million. Additionally, an accordion feature allows us to increase the facility amount up to $700 million.
Effective February 11, 2010, we entered into an amended and restated $500 million unsecured revolving credit facility, which was amended and replaced on September 30, 2011 as described above. The facility provided borrowing rates that floated at a margin over LIBOR plus a facility fee. The borrowing margin and facility fee were priced off a grid that was tied to our senior unsecured credit ratings, which were 275.0 and 50.0 basis points, respectively.
Effective May 2010, we entered into an agreement with a bank for an unsecured and uncommitted overnight facility totaling $99 million that we intend to maintain for cash management purposes. The facility provides for fixed interest rate loans at a 30 day LIBOR rate plus a borrowing margin based on market liquidity.
The following table discloses certain information regarding our unsecured notes payable under our revolving credit facilities (in thousands, except percentages):
| | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
| | |
Unsecured revolving credit facility: | | | | | | | | |
Balance outstanding | | $ | 145,000 | | | $ | - | |
Available balance | | $ | 351,571 | | | $ | 447,599 | |
Letter of credit outstanding under facility | | $ | 3,429 | | | $ | 52,401 | |
Variable interest rate | | | 1.3% | | | | - | |
Unsecured and uncommitted overnight facility: | | | | | | | | |
Balance outstanding | | $ | 21,500 | | | $ | 80,000 | |
Variable interest rate | | | 1.5% | | | | 1.8% | |
Both facilities: | | | | | | | | |
Maximum balance outstanding during the year | | $ | 330,700 | | | $ | 80,000 | |
Weighted average balance | | $ | 151,814 | | | $ | 12,151 | |
Weighted average interest rate | | | 1.5% | | | | 1.8% | |
Related to a development project in Sheridan, Colorado, we have provided a guaranty for the payment of any debt service shortfalls until a coverage rate of 1.4 is met on tax increment revenue bonds issued in connection withand debt, and there can be no assurance that the project. The bonds are todisclosed value of any financial instrument could be repaid with incremental sales and property taxes and a PIF to be assessed on current and future retail sales and, to the extent necessary, any amounts we may have to provide under a guaranty. The incremental taxes and PIF are to remain intact until the earlierrealized by immediate settlement of the dateinstrument. The following provides information about the bond liability has been paid in full or 2040, as extended by the Agency in April 2011. Therefore, a debt service guaranty liability equalmethods used to estimate the fair value of the amounts funded under the bonds was recorded. At December 31, 2011our financial instruments, including their estimated fair values:
Investments and 2010, respectively, we had $74.1 millionDeferred Compensation Plan Obligations
Investments in mutual funds held in a grantor trust and
$97.0 million outstanding for the debt service guaranty liability.At December 31, 2011 and 2010, respectively, we had $54.1 million and $129.9 million of 3.95% convertible senior unsecured notes outstanding due 2026. Interest is payable semi-annually in arrears on February 1 and August 1 of each year. The notesmutual funds are redeemable for cash, at our option, for the principal amount plus accrued and unpaid interest. Holders of the notes have the right to require us to repurchase their notes for cash equal to the principal of the notes plus accrued and unpaid interest in August 2016 and 2021 or in the event of a change in control.
The notes are convertible under certain circumstances for our common shares at an initial conversion rate of 20.3770 common shares per $1,000 of principal amount of the notes (an initial conversion price of $49.075). Upon the conversion of the notes, we will deliver cash for the principal return, as defined, and cash or common shares, at our option, for the excess of the conversion value, as defined, over the principal return.
These notes were recorded at a discount of $1.3 million as of December 31, 2010, which was amortized through July 2011, resulting in an effective interest rate as of December 31, 2011 and 2010 of 5.34% and 5.75%, respectively. The carrying value of the equity component as of both December 31, 2011 and 2010 was $23.4 million.
Net interest expense on our 3.95% convertible senior unsecured notes is as follows (in thousands):
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
| | | |
Interest expense | | $ | 4,218 | | | $ | 5,782 | | | $ | 14,508 | |
Amortization of discount | | | 1,334 | | | | 2,191 | | | | 4,969 | |
| | | | | | | | | | | | |
Net interest expense | | $ | 5,552 | | | $ | 7,973 | | | $ | 19,477 | |
| | | | | | | | | | | | |
On August 29, 2011, we entered into a $200 million unsecured term loan of which the proceeds were used to pay down amounts outstanding under our revolving credit facility. The initial term of the loan is one year and can be repaid at par after nine months at our option. Borrowing rates under the agreement float at a margin over LIBOR and are priced off a grid that is tied to our senior unsecured credit ratings, which is currently 125.0 basis points.
During 2011, $77.2 million of the 3.95% convertible senior unsecured notes were redeemed for cash in accordance with the provisions described above, and we paid our fixed-rate 7% unsecured notes in the amount of $117.7 million at maturity.
Various leases and properties, and current and future rentals from those lease and properties, collateralize certain debt. At December 31, 2011 and 2010, the carrying value of such property aggregated $1.7 billion and $1.8 billion, respectively.
Scheduled principal payments on our debt (excluding $166.5 million due under our revolving credit facilities, $21.0 million of certain capital leases, $10.8 million fair value of interest rate contracts, $2.3 million net premium/(discount) on debt, $10.1 million of non-cash debt-related items, and $74.1 million debt service guaranty liability) are due during the following years (in thousands):
| | | | |
2012 | | $ | 495,226 | |
2013 | | | 315,211 | |
2014 | | | 473,968 | |
2015 | | | 245,627 | |
2016 | | | 231,661 | |
2017 | | | 142,096 | |
2018 | | | 64,441 | |
2019 | | | 153,724 | |
2020 | | | 3,746 | |
2021 | | | 2,763 | |
Thereafter (1) | | | 118,575 | |
| | | | |
Total | | $ | 2,247,038 | |
| | | | |
| (1) | Includes $54.1 million of our 3.95% convertible senior unsecured notes outstanding due 2026, which may be called by us at any time and have future put options in 2016 and 2021.
|
Our various debt agreements contain restrictive covenants, including minimum interest and fixed charge coverage ratios, minimum unencumbered interest coverage ratios, minimum net worth requirements and maximum total debt levels. We believe we were in compliance with our public debt and revolving credit facility covenants as of December 31, 2011.
Note 8. Derivatives and Hedging
The fair value of all our interest rate contracts was reported as follows (in thousands):
| | | | | | | | | | | | | | | | |
| | | Assets | | | Liabilities | |
| | | Balance Sheet
Location | | | Amount | | | Balance Sheet
Location | | | Amount | |
| | | | |
Designated Hedges: | | | | | | | | | | | | | | | | |
December 31, 2011 | | | Other Assets, net | | | $ | 10,816 | | | | Other Liabilities, net | | | $ | 674 | |
December 31, 2010 | | | Other Assets, net | | | | 7,192 | | | | Other Liabilities, net | | | | 108 | |
Cash Flow Hedges:
As of December 31, 2011 and 2010, respectively, we had three and two active interest rate contracts designated as cash flow hedges with an aggregate notional amount of $27.1 million and $11.8 million, respectively. These contracts have maturities through September 2017 and either fix or cap interest rates ranging from 2.3% to 5.0%. We have determined that these contracts are highly effective in offsetting future variable interest cash flows.
As of December 31, 2011 and 2010, the balance in accumulated other comprehensive loss relating to cash flow interest rate contracts was $10.0 million and $11.7 million, respectively, and will be reclassified to net interest expense as interest payments are made on our fixed-rate debt. Within the next 12 months, approximately $2.8 million of the balance in accumulated other comprehensive loss is expected to be amortized to net interest expense related to settled interest rate contracts.
Summary of cash flow interest rate contract hedging activity is as follows (in thousands):
| | | | | | | | | | | | | | | | |
Derivatives Hedging Relationships | | Amount of Gain
(Loss) Recognized
in Other
Comprehensive
Income on
Derivative (Effective
Portion) | | | Location of Gain
(Loss) Reclassified
from Accumulated
Other
Comprehensive
Loss into Income | | Amount of Gain
(Loss) Reclassified
from Accumulated
Other
Comprehensive
Loss into Income
(Effective Portion) | | | Location of Gain
(Loss)
Recognized in
Income on
Derivative
(Ineffective
Portion and
Amount Excluded
from
Effectiveness
Testing) | | Amount of Gain
(Loss)
Recognized in
Income on
Derivative
(Ineffective
Portion and
Amount Excluded
from
Effectiveness
Testing) | |
| | | | | |
Year Ended December 31, 2011 | | $ | 866 | | | Interest expense, net | | $ | (2,551 | ) | | Interest expense,
net | | $ | (12 | ) |
| | | | | |
Year Ended December 31, 2010 | | $ | (96 | ) | | Interest expense, net | | $ | (2,566 | ) | | Interest expense,
net | | $ | (27 | ) |
| | | | | |
Year Ended December 31, 2009 | | $ | - | | | Interest expense, net | | $ | (2,481 | ) | | Interest expense,
net | | $ | - | |
Fair Value Hedges:
As of December 31, 2011 and 2010, we had four interest rate contracts, maturing through October 2017, with an aggregate notional amount of $119.3 million and $120.4 million, respectively, that were designated as fair value hedges and convert fixed interest payments at rates from 4.2% to 7.5% to variable interest payments ranging from .5% to 4.4%. We have determined that our fair value hedges are highly effective in limiting our risk of changes in the fair value of fixed-rate notes attributable to changes in interest rates.
A summary of the changes in fair value of our interest rate contracts is as follows (in thousands):
| | | | | | | | | | | | |
| | | Gain (Loss) on
Contracts | | | Gain (Loss) on
Borrowings | | | Gain (Loss)
Recognized in
Income | |
| | | |
Year Ended December 31, 2011: | | | | | | | | | | | | |
Interest expense, net | | $ | 3,676 | | | $ | (3,676 | ) | | $ | - | |
| | | |
Year Ended December 31, 2010: | | | | | | | | | | | | |
Interest expense, net | | $ | 17,511 | | | $ | (16,547 | ) | | $ | 964 | |
| | | |
Year Ended December 31, 2009: | | | | | | | | | | | | |
Interest expense, net | | $ | (6,659 | ) | | $ | 6,659 | | | $ | - | |
A summary of our fair value interest rate contract hedges impact on net income is as follows (in thousands):
| | | | | | | | | | | | |
Derivatives Hedging Relationships | | Location of Gain
(Loss) Recognized in
Income on Derivative | | Amount of Gain (Loss)
Recognized in Income
on Derivative | | | Location of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing) | | Amount of Gain (Loss)
Recognized in Income
on Derivative
(Ineffective Portion
and Amount Excluded
from Effectiveness
Testing) | |
| | | | |
Year Ended December 31, 2011 | | Interest expense, net | | $ | 7,748 | | | | | $ | - | |
| | | | |
Year Ended December 31, 2010 | | Interest expense, net | | $ | 24,483 | | | Interest expense, net | | $ | 964 | |
| | | | |
Year Ended December 31, 2009 | | Interest expense, net | | $ | (4,528 | ) | | | | $ | - | |
Note 9. Preferred Shares of Beneficial Interest
We issued $150 million and $200 million of depositary shares on June 6, 2008 and January 30, 2007, respectively. Each depositary share represents one-hundredth of a Series F Cumulative Redeemable Preferred Share. The depositary shares are redeemable at our option, in whole or in part, for cash at a redemption price of $25 per depositary share, plus any accrued and unpaid dividends thereon. The depositary shares are not convertible or exchangeable for any of our other property or securities. The Series F Preferred Shares pay a 6.5% annual dividend and have a liquidation value of $2,500 per share. The Series F Preferred Shares issued in June 2008 were issued at a discount, resulting in an effective rate of 8.25%.
In July 2004, we issued $72.5 million of depositary shares with each share representing one-hundredth of a Series E Cumulative Redeemable Preferred Share. The depositary shares are redeemable at our option, in whole or in part, for cash at a redemption price of $25 per depositary share, plus any accrued and unpaid dividends thereon. The depositary shares are not convertible or exchangeable for any of our other property or securities. The Series E Preferred Shares pay a 6.95% annual dividend and have a liquidation value of $2,500 per share.
In April 2003, we issued $75 million of depositary shares with each share representing one-thirtieth of a Series D Cumulative Redeemable Preferred Share. The depositary shares are redeemable at our option, in whole or in part, for cash at a redemption price of $25 per depositary share, plus any accrued and unpaid dividends thereon. The depositary shares are not convertible or exchangeable for any of our property or securities. The Series D Preferred Shares pay a 6.75% annual dividend and have a liquidation value of $750 per share.
Currently, we do not anticipate redeeming the Series F, Series E or Series D Preferred Shares due to current market conditions; however, no assurance can be given that we will not redeem these shares if conditions change.
Note 10. Common Shares of Beneficial Interest
The dividend rate per share for our common shares for each quarter of 2011 and 2010 was $.275 and $.260, respectively. Subsequent to December 31, 2011, our Board of Trust Managers approved an increase to our quarterly dividend rate to $.290 per share.
In May 2010, our shareholders approved an amendment to our declaration of trust increasing the number of our authorized common shares, $.03 par value per share, from 150.0 million to 275.0 million.
Note 11. Noncontrolling Interests
The following table summarizes the effect of changes in our ownership interest in subsidiaries on the equity attributable to us as follows (in thousands):
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
| | | |
Net income adjusted for noncontrolling interests | | $ | 15,621 | | | $ | 46,206 | | | $ | 171,102 | |
Transfers from the noncontrolling interests: | | | | | | | | | | | | |
Increase in equity for operating partnership units | | | - | | | | 746 | | | | 14,251 | |
Net increase (decrease) in equity for the acquisition of noncontrolling interests | | | 1,668 | | | | (879) | | | | - | |
| | | | | | | | | | | | |
Change from net income adjusted for noncontrolling interests and transfers from the noncontrolling interests | | $ | 17,289 | | | $ | 46,073 | | | $ | 185,353 | |
| | | | | | | | | | | | |
Note 12. Leasing Operations
The terms of our leases range from less than one year for smaller tenant spaces to over 25 years for larger tenant spaces. In addition to minimum lease payments, most of the leases provide for contingent rentals (payments for real estate taxes, maintenance and insurance by lessees and an amountvalued based on a percentage of the tenants’ sales).
Schedule of future minimum rental income from non-cancelable tenant leases, which does not include estimated contingent rentals, at December 31, 2011 are as follows (in thousands):
| | | | |
2012 | | $ | 412,005 | |
2013 | | | 354,930 | |
2014 | | | 289,604 | |
2015 | | | 228,718 | |
2016 | | | 169,649 | |
Thereafter | | | 563,984 | |
| | | | |
Total | | $ | 2,018,890 | |
| | | | |
Contingent rentals for the year ended December 31, are as follows (in thousands):
| | | | |
2011 | | $ | 112,414 | |
2010 | | | 115,488 | |
2009 | | | 119,485 | |
Note 13. Impairment
The following impairment charges were recorded on the following assets based on the difference between the carrying amount of the assets and the estimated fair value (see Note 24 for additional fair value information) (in thousands):
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
Continuing operations: | | | | | | | | | | | | |
Land held for development and undeveloped land (1) | | $ | 23,646 | | | $ | 2,827 | | | $ | 32,774 | |
Property marketed for sale or sold (2) | | | 14,599 | | | | 2,350 | | | | 2,209 | |
Investments in real estate joint ventures and partnerships (3) | | | 1,752 | | | | 15,825 | | | | - | |
Tax increment revenue bonds and notes (4) | | | 18,737 | | | | 12,315 | | | | - | |
| | | | | | | | | | | | |
Total reported in continuing operations | | | 58,734 | | | | 33,317 | | | | 34,983 | |
| | | |
Discontinued operations: | | | | | | | | | | | | |
Property held for sale or sold | | | 17,140 | | | | - | | | | 3,853 | |
| | | | | | | | | | | | |
| | | |
Total impairment charges | | | 75,874 | | | | 33,317 | | | | 38,836 | |
| | | |
Other financial statement captions impacted by impairment: | | | | | | | | | | | | |
Equity in loss of real estate joint ventures and partnerships, net | | | 7,022 | | | | 115 | | | | 6,747 | |
Net loss attributable to noncontrolling interests | | | (4,459) | | | | - | | | | (1,501) | |
| | | | | | | | | | | | |
| | | |
Net impact of impairment charges | | $ | 78,437 | | | $ | 33,432 | | | $ | 44,082 | |
| | | | | | | | | | | | |
| (1) | These impairments were prompted by changes in management’s plans for these properties, recent comparable market transactions and/or a change in market conditions.
|
| (2) | These charges resulted from changes in management’s plans for these properties, primarily the marketing of these properties for sale. Also included in this caption are impairments associated with dispositions that did not qualify to be reported in discontinued operations.
|
| (3) | Amounts reported in 2011 relate to current market conditions. The amount reported in 2010 represents an impairment loss recognized in connection with the revaluation of our 50% equity interest in a development project in Sheridan, Colorado, as a result of our assumption of control of the project as of April 1, 2010. See Note 23 for additional information.
|
| (4) | During 2011, the tax increment revenue bonds were remarketed by the Agency. All of the outstanding bonds were recalled, and new bonds were issued. We recorded an $18.7 million net credit loss on the exchange of bonds associated with our investment in the subordinated tax increment revenue bonds. In 2010, we wrote down the value of our subordinated tax increment revenue bonds and notes due to change in holding status of the bonds.
|
Note 14. Federal Income Tax Considerations
We qualify as a REIT under the provisions of the Internal Revenue Code, and therefore, no tax is imposed on our taxable income distributed to shareholders. To maintain our REIT status, we must distribute at least 90% of our ordinary taxable income to our shareholders and meet certain income source and investment restriction requirements. Our shareholders must report their share of income distributed in the form of dividends.
Taxable income differs from net income for financial reporting purposes principally because of differences in the timing of recognition of depreciation, rental revenue, interest expense, compensation expense, impairment losses and gain from sales of property. As a result of these differences, the tax basis of our net fixed assets exceeds the book value by $37 million at December 31, 2011, and our book value of our net fixed assets exceeds the tax basis by $38 million at December 31, 2010.
The following table reconciles net income adjusted for noncontrolling interests to REIT taxable income (in thousands):
| | | $(33,185) | | | | $(33,185) | | | | $(33,185) | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
Net income adjusted for noncontrolling interests | | $ | 15,621 | | | $ | 46,206 | | | $ | 171,102 | |
Net loss of taxable REIT subsidiaries included above | | | 32,043 | | | | 22,450 | | | | 8,966 | |
| | | | | | | | | | | | |
Net income from REIT operations | | | 47,664 | | | | 68,656 | | | | 180,068 | |
Book depreciation and amortization including discontinued operations | | | 157,290 | | | | 151,108 | | | | 151,888 | |
Tax depreciation and amortization | | | (100,633) | | | | (95,848) | | | | (133,537) | |
Book/tax difference on gains/losses from capital transactions | | | (13,398) | | | | 1,233 | | | | (6,137) | |
Deferred/prepaid/above and below market rents, net | | | (13,088) | | | | (5,076) | | | | (12,489) | |
Impairment loss from REIT operations including discontinued operations | | | 58,353 | | | | 28,376 | | | | 21,862 | |
Other book/tax differences, net | | | (3,652) | | | | (22,785) | | | | 28,097 | |
| | | | | | | | | | | | |
REIT taxable income | | | 132,536 | | | | 125,664 | | | | 229,752 | |
Dividends paid deduction | | | (165,721) | | | | (125,664) | | | | (229,752) | |
| | | | | | | | | | | | |
Dividends paid in excess of taxable income | | $ | (33,185) | | | $ | - | | | $ | - | |
| | | | | | | | | | | | |
The dividends paid deduction in 2010 and 2009 includes designated dividends of $3.8 million from 2011 and $61.2 million from 2010, respectively.
For federal income tax purposes, the cash dividends distributed to common shareholders are characterized as follows:
| | | 100.0 | | | | 100.0 | | | | 100.0 | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
Ordinary income | | | 100.0% | | | | 79.1% | | | | 68.1% | |
Capital gain distributions | | | 0.0% | | | | 20.9% | | | | 31.9% | |
| | | | | | | | | | | | |
Total | | | 100.0% | | | | 100.0% | | | | 100.0% | |
| | | | | | | | | | | | |
Our deferred tax assets and liabilities, including a valuation allowance, consisted of the following (in thousands):
| | | $11,885 | | | | $11,885 | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
| | |
Deferred tax assets: | | | | | | | | |
Impairment loss (1) | | $ | 20,450 | | | $ | 13,584 | |
Allowance on other assets | | | 1,528 | | | | 1,423 | |
Interest expense | | | 8,318 | | | | 7,256 | |
Net operating loss carryforward | | | 4,870 | | | | 4,684 | |
Book-tax basis differential | | | 1,132 | | | | 524 | |
Other | | | 182 | | | | 148 | |
| | | | | | | | |
Total deferred tax assets | | | 36,480 | | | | 27,619 | |
Valuation allowance (2) | | | (24,595) | | | | (15,818) | |
| | | | | | | | |
Total deferred tax assets, net of allowance | | $ | 11,885 | | | $ | 11,801 | |
| | | | | | | | |
Deferred tax liabilities: | | | | | | | | |
Straight-line rentals | | $ | 1,612 | | | $ | 1,290 | |
Book-tax basis differential | | | 3,553 | | | | 4,708 | |
Other | | | 1 | | | | - | |
| | | | | | | | |
Total deferred tax liabilities | | $ | 5,166 | | | $ | 5,998 | |
| | | | | | | | |
| (1) | Impairment losses will not be recognized until the related properties are sold and realization is dependent upon generating sufficient taxable income in the year the property is sold.
|
| (2) | Management believes it is more likely than not that a portion of the deferred tax assets, which primarily consists of impairment losses, will not be realized and established a valuation allowance. However, the amount of the deferred tax asset considered realizable could be reduced if estimates of future taxable income are reduced.
|
We are subject to federal, state and local income taxes and have recorded an income tax (benefit) provision as follows (in thousands):
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
| | | |
Federal income tax of taxable REIT subsidiaries (1) | | $ | (916) | | | $ | (1,181) | | | $ | 4,453 | |
Texas franchise tax (2) | | | 1,373 | | | | 1,422 | | | | 1,960 | |
| | | | | | | | | | | | |
| | | |
Total | | $ | 457 | | | $ | 241 | | | $ | 6,413 | |
| | | | | | | | | | | | |
| (1) | All periods presented are open for examination by the IRS.
|
| (2) | For all periods presented, amounts include the effects that are reported in discontinued operations. See Note 15 for additional information.
|
Also, a current tax obligation of $1.5 million and $1.6 million has been recorded at December 31, 2011 and 2010, respectively, in association with these taxes.
Note 15. Discontinued Operations
During 2011, we sold three industrial properties, of which two are located in Georgia and one in Texas, and eight shopping centers, of which five are located in Texas and one each in Florida, Kansas and North Carolina. We classified seven shopping centers with a net book value of $73.2 million as held for sale as of December 31, 2011, of which three are located in Texas and one each in Arizona, Florida, Illinois and North Carolina. During 2010, we sold a shopping center located in Texas. Included in the Consolidated Balance Sheet at December 31, 2010 were $169.5 million of property and $33.8 million of accumulated depreciation related to properties sold during 2011 and held for sale as of December 31, 2011.
The operating results of these properties have been reclassified and reported as discontinued operations in the Consolidated Statements of Operations and Comprehensive Income as follows (in thousands):
| | | $5,842 | | | | $5,842 | | | | $5,842 | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
| | | |
Revenues, net | | $ | 18,879 | | | $ | 19,614 | | | $ | 36,795 | |
| | | | | | | | | | | | |
| | | |
Depreciation and amortization | | | (4,308) | | | | (5,214) | | | | (9,340) | |
Operating expenses | | | (3,351) | | | | (3,617) | | | | (6,978) | |
Real estate taxes, net | | | (2,962) | | | | (3,386) | | | | (5,154) | |
Impairment loss | | | (17,140) | | | | - | | | | (3,853) | |
General and administrative | | | (9) | | | | (7) | | | | (9) | |
Interest, net | | | 21 | | | | (642) | | | | (1,624) | |
Interest and other income, net | | | - | | | | - | | | | 3 | |
Gain on acquisition (see Note 23) | | | 4,559 | | | | - | | | | - | |
Provision for income taxes | | | (62) | | | | (61) | | | | (144) | |
| | | | | | | | | | | | |
| | | |
Operating (loss) income from discontinued operations | | | (4,373) | | | | 6,687 | | | | 9,696 | |
| | | |
Gain on sale of property from discontinued operations | | | 10,215 | | | | 1,093 | | | | 55,765 | |
| | | | | | | | | | | | |
Income from discontinued operations | | $ | 5,842 | | | $ | 7,780 | | | $ | 65,461 | |
| | | | | | | | | | | | |
We do not allocate other consolidated interest to discontinued operations because the interest savings to be realized from the proceeds of the sale of these operations is not material.
Note 16. Cash Flow Information
Non-cash investing and financing activities are summarized as follows (in thousands):
| | | $14,251 | | | | $14,251 | | | | $14,251 | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
Exchange of interests in real estate joint ventures and partnerships for common shares | | $ | - | | | $ | 746 | | | $ | 14,251 | |
Accrued property construction costs | | | 7,535 | | | | 6,878 | | | | 10,677 | |
Increase (decrease) in equity for the acquisition of noncontrolling interests in consolidated real estate joint ventures | | | 1,668 | | | | (879 | ) | | | - | |
Reduction of debt service guaranty liability (see Note 7) | | | (22,925 | ) | | | - | | | | - | |
Reduction of real estate joint ventures and partnerships - investments and contingent liability associated with a lawsuit (see Note 21) | | | - | | | | - | | | | (41,000 | ) |
Consolidation of joint ventures (see Note 23): | | | | | | | | | | | | |
Increase in other assets | | | - | | | | 148,255 | | | | - | |
Decrease in notes receivable from real estate joint ventures and partnerships | | | (21,872 | ) | | | (123,912 | ) | | | - | |
Increase in debt, net | | | - | | | | 101,741 | | | | - | |
Increase in property, net | | | 32,307 | | | | 32,940 | | | | - | |
Decrease in real estate joint ventures and partnerships - investments | | | (10,092 | ) | | | - | | | | - | |
Decrease in other liabilities, net | | | - | | | | (21,858 | ) | | | - | |
Decrease in noncontrolling interests | | | - | | | | (18,573 | ) | | | - | |
Property acquisitions and investments in unconsolidated real estate joint ventures: | | | | | | | | | | | | |
Increase in debt, net | | | - | | | | 27,302 | | | | - | |
Increase in property, net | | | 4,749 | | | | 18,376 | | | | - | |
Increase in real estate joint ventures and partnerships - investments | | | 490 | | | | - | | | | - | |
Increase in restricted deposits and mortgage escrows | | | - | | | | 498 | | | | - | |
Increase in other, net | | | 87 | | | | 302 | | | | - | |
Increase in noncontrolling interests | | | 9,949 | | | | - | | | | - | |
Sale of property and property interest: | | | | | | | | | | | | |
Decrease in debt, net due to debt assumption | | | - | | | | (28,129 | ) | | | (9,056 | ) |
Decrease in property, net | | | - | | | | (37,969 | ) | | | (28,195 | ) |
Increase in real estate joint ventures and partnerships - investments | | | - | | | | 9,840 | | | | 19,139 | |
Note 17. Earnings Per Share
Earnings per common share – basic is computed using net (loss) income attributable to common shareholders and the weighted average number of shares outstanding. Earnings per common share – diluted include the effect of potentially dilutive securities. (Loss) income from continuing operations attributable to common shareholders includes gain on sale of property in accordance with SEC guidelines. Earnings per common share – basic and diluted components for the periods indicated are as follows (in thousands):
| | | $(25,697) | | | | $(25,697) | | | | $(25,697) | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
| | | |
Numerator: | | | | | | | | | | | | |
Continuing Operations: | | | | | | | | | | | | |
Income from continuing operations | | $ | 9,160 | | | $ | 41,453 | | | $ | 84,549 | |
Gain on sale of property | | | 1,737 | | | | 2,005 | | | | 25,266 | |
Net income attributable to noncontrolling interests | | | (1,118) | | | | (5,032) | | | | (4,174) | |
Preferred share dividends | | | (35,476) | | | | (35,476) | | | | (35,476) | |
| | | | | | | | | | | | |
(Loss) income from continuing operations attributable to common shareholders – basic and diluted | | $ | (25,697) | | | $ | 2,950 | | | $ | 70,165 | |
| | | | | | | | | | | | |
Discontinued Operations: | | | | | | | | | | | | |
Income from discontinued operations attributable to common shareholders – basic and diluted | | $ | 5,842 | | | $ | 7,780 | | | $ | 65,461 | |
| | | | | | | | | | | | |
| | | |
Denominator: | | | | | | | | | | | | |
Weighted average shares outstanding – basic | | | 120,331 | | | | 119,935 | | | | 109,546 | |
Effect of dilutive securities: | | | | | | | | | | | | |
Share options and awards | | | - | | | | 845 | | | | 632 | |
| | | | | | | | | | | | |
Weighted average shares outstanding – diluted | | | 120,331 | | | | 120,780 | | | | 110,178 | |
| | | | | | | | | | | | |
Anti-dilutive securities of our common shares, which are excluded from the calculation of net (loss) income per common share – diluted are as follows (in thousands):
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
| | | |
Share options (1) | | | 3,158 | | | | 3,537 | | | | 3,120 | |
Operating partnership units | | | 1,617 | | | | 1,662 | | | | 2,040 | |
Share options and awards | | | 894 | | | | - | | | | - | |
| | | | | | | | | | | | |
Total anti-dilutive securities | | | 5,669 | | | | 5,199 | | | | 5,160 | |
| | | | | | | | | | | | |
| (1) | Exclusion results as exercise prices were greater than the average market price for each respective period.
|
Note 18. Share Options and Awards
In April 2011, our Long-Term Incentive Plan for the issuance of options and share awards expired, and issued options of 3.6 million remain outstanding as of December 31, 2011.
In May 2010, our shareholders approved the adoption of the Amended and Restated 2010 Long-Term Incentive Plan, under which 3.0 million of our common shares were reserved for issuance, and options and share awards of 2.1 million are available for future grant at December 31, 2011. This plan expires in May 2020.
The fair value of share options and restricted shares is estimated on the date of grant using the Black-Scholes option pricing method based on the expected weighted average assumptions in the following table. The fair value and weighted average assumptions are as follows:
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
Fair value per share option | | $ | 5.68 | | | $ | 5.42 | | | $ | 1.99 | |
Dividend yield | | | 5.3% | | | | 5.3% | | | | 5.2% | |
Expected volatility | | | 39.6% | | | | 38.8% | | | | 31.3% | |
Expected life (in years) | | | 6.2 | | | | 6.2 | | | | 6.2 | |
Risk-free interest rate | | | 2.4% | | | | 2.9% | | | | 1.7% | |
Compensation expense, net of forfeitures, associated with share options and restricted shares totaled $6.4 million in 2011, $4.9 million in 2010 and $4.2 million in 2009, respectively, of which $1.5 million in 2011 and $1.2 million in both 2010 and 2009 was capitalized.
Following is a summary of the option activity for the three years ended December 31, 2011:
| | | | | | | | |
| | | Shares
Under
Option | | | Weighted
Average
Exercise
Price | |
Outstanding, January 1, 2009 | | | 3,317,655 | | | $ | 32.96 | |
Granted | | | 1,182,252 | | | | 11.85 | |
Forfeited or expired | | | (54,364) | | | | 26.90 | |
Exercised | | | (9,400) | | | | 18.05 | |
| | | | | | | | |
Outstanding, December 31, 2009 | | | 4,436,143 | | | | 27.44 | |
Granted | | | 504,781 | | | | 22.68 | |
Forfeited or expired | | | (22,973) | | | | 21.29 | |
Exercised | | | (303,679) | | | | 17.32 | |
| | | | | | | | |
Outstanding, December 31, 2010 | | | 4,614,272 | | | | 27.62 | |
Granted | | | 483,459 | | | | 24.87 | |
Forfeited or expired | | | (230,232) | | | | 22.81 | |
Exercised | | | (259,796) | | | | 18.34 | |
| | | | | | | | |
Outstanding, December 31, 2011 | | | 4,607,703 | | | $ | 28.09 | |
| | | | | | | | |
The total intrinsic value of options exercised was $1.9 million in 2011, $1.8 million in 2010 and $.02 million in 2009. As of both December 31, 2011 and 2010, there was approximately $3.8 million, of total unrecognized compensation cost related to unvested share options, which is expected to be amortized over a weighted average of 2.4 years and 2.5 years, respectively.
The following table summarizes information about share options outstanding and exercisable at December 31, 2011:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Range of
Exercise Prices | | Outstanding | | | Exercisable | |
| | Number | | | Weighted
Average
Remaining
Contractual
Life | | | Weighted
Average
Exercise
Price | | | Aggregate
Intrinsic
Value
(000’s) | | | Number | | | Weighted
Average
Exercise
Price | | | Weighted
Average
Remaining
Contractual
Life | | | Aggregate
Intrinsic
Value
(000’s) | |
| | | | | | | | |
$11.85 - $17.78 | | | 960,267 | | | | 7.2 years | | | $ | 11.85 | | | | | | | | 429,660 | | | $ | 11.85 | | | | 7.2 years | | | | | |
| | | | | | | | |
$17.79 - $26.69 | | | 1,275,554 | | | | 6.8 years | | | $ | 23.96 | | | | | | | | 426,128 | | | $ | 24.09 | | | | 2.8 years | | | | | |
| | | | | | | | |
$26.70 - $40.05 | | | 1,898,161 | | | | 4.2 years | | | $ | 34.26 | | | | | | | | 1,640,041 | | | $ | 34.58 | | | | 3.9 years | | | | | |
| | | | | | | | |
$40.06 - $49.62 | | | 473,721 | | | | 4.9 years | | | $ | 47.46 | | | | | | | | 473,499 | | | $ | 47.46 | | | | 4.9 years | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | |
Total | | | 4,607,703 | | | | 5.6 years | | | $ | 28.09 | | | $ | - | | | | 2,969,328 | | | $ | 31.84 | | | | 4.4 years | | | $ | - | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
A summary of the status of unvested restricted shares for the year ended December 31, 2011 is as follows:
| | | | | | | | |
| | | Unvested
Restricted
Share
Awards | | | Weighted
Average Grant
Date Fair Value | |
| | |
| | |
| | |
Outstanding, January 1, 2011 | | | 396,797 | | | $ | 19.32 | |
Granted | | | 161,380 | | | | 24.81 | |
Vested | | | (132,839) | | | | 22.40 | |
Forfeited | | | (18,010) | | | | 20.58 | |
| | | | | | | | |
Outstanding, December 31, 2011 | | | 407,328 | | | $ | 20.43 | |
| | | | | | | | |
As of December 31, 2011 and 2010, there was approximately $5.0 million and $5.1 million, respectively, of total unrecognized compensation cost related to unvested restricted shares, which is expected to be amortized over a weighted average of 2.3 years and 2.8 years, respectively.
Note 19. Employee Benefit Plans
Effective April 1, 2002, we converted a noncontributory pension plan to a noncontributory cash balance retirement plan under which each participant received an actuarially determined opening balance. Certain participants were grandfathered under the prior pension plan formula. In addition to this plan, effective September 1, 2002, we established two separate and independent nonqualified supplemental retirement plans for certain employees.
The estimated net loss, prior service cost, and transition obligation that will be amortized from accumulated other comprehensive loss into net periodic benefit cost over the next fiscal year are $1,545,000, ($117,000) and zero, respectively.
The following tables summarize changes in the benefit obligation, the plan assets and the funded status of our pension plans as well as the components of net periodic benefit costs, including key assumptions (in thousands). The measurement dates for plan assets and obligations were December 31, 2011 and 2010.
| | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
Change in Projected Benefit Obligation: | | | | | | | | |
Benefit obligation at beginning of year | | $ | 57,875 | | | $ | 51,333 | |
Service cost | | | 3,335 | | | | 3,325 | |
Interest cost | | | 3,454 | | | | 3,212 | |
Actuarial loss | | | 5,576 | | | | 1,769 | |
Benefit payments | | | (1,850) | | | | (1,764) | |
| | | | | | | | |
Benefit obligation at end of year | | $ | 68,390 | | | $ | 57,875 | |
| | | | | | | | |
| | |
Change in Plan Assets: | | | | | | | | |
Fair value of plan assets at beginning of year | | $ | 27,026 | | | $ | 23,509 | |
Actual return on plan assets | | | (429) | | | | 2,600 | |
Employer contributions | | | 2,902 | | | | 2,681 | |
Benefit payments | | | (1,850) | | | | (1,764) | |
| | | | | | | | |
Fair value of plan assets at end of year | | $ | 27,649 | | | $ | 27,026 | |
| | | | | | | | |
| | |
Unfunded Status at End of Year: | | | | | | | | |
Retirement Plan (included in accounts payable and accrued expenses) | | $ | 11,247 | | | $ | 4,517 | |
SRP (included in other net liabilities) | | | 29,494 | | | | 26,332 | |
| | | | | | | | |
Total unfunded | | $ | 40,741 | | | $ | 30,849 | |
| | | | | | | | |
| | |
Accumulated benefit obligation | | $ | 68,075 | | | $ | 57,418 | |
| | | | | | | | |
| | |
Amounts recognized in accumulated other comprehensive loss consist of: | | | | | | | | |
Net loss | | $ | 17,844 | | | $ | 10,296 | |
Prior service credit | | | (117) | | | | (235) | |
| | | | | | | | |
Total amount recognized | | $ | 17,727 | | | $ | 10,061 | |
| | | | | | | | |
The following is the required information for other changes in plan assets and benefit obligations recognized in other comprehensive income (in thousands):
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
| | | |
Net loss (gain) | | $ | 8,234 | | | $ | 1,132 | | | $ | (2,407) | |
Amortization of net loss | | | (685) | | | | (744) | | | | (947) | |
Amortization of prior service cost | | | 117 | | | | 117 | | | | 117 | |
| | | | | | | | | | | | |
Total recognized in other comprehensive income | | $ | 7,666 | | | $ | 505 | | | $ | (3,237) | |
| | | | | | | | | | | | |
Total recognized in net periodic benefit costs and other comprehensive income | | $ | 12,794 | | | $ | 5,704 | | | $ | 2,705 | |
| | | | | | | | | | | | |
The following is the required information for plans with an accumulated benefit obligation in excess of plan assets (in thousands):
| | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
| | |
Projected benefit obligation | | $ | 68,390 | | | $ | 57,875 | |
Accumulated benefit obligation | | | 68,075 | | | | 57,418 | |
Fair value of plan assets | | | 27,649 | | | | 27,026 | |
The components of net periodic benefit cost for both plans are as follows (in thousands):
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
| | | |
Service cost | | $ | 3,335 | | | $ | 3,325 | | | $ | 3,571 | |
Interest cost | | | 3,454 | | | | 3,212 | | | | 2,931 | |
Expected return on plan assets | | | (2,229) | | | | (1,965) | | | | (1,391) | |
Prior service cost | | | (117) | | | | (117) | | | | (117) | |
Recognized loss | | | 685 | | | | 744 | | | | 947 | |
| | | | | | | | | | | | |
| | | |
Total | | $ | 5,128 | | | $ | 5,199 | | | $ | 5,941 | |
| | | | | | | | | | | | |
The assumptions used to develop periodic expense for both plans are shown below:
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
| | | |
Discount rate – Retirement Plan | | | 5.30% | | | | 5.82% | | | | 6.00% | |
Salary scale increases – Retirement Plan | | | 4.00% | | | | 4.00% | | | | 4.00% | |
Salary scale increases – SRP | | | 5.00% | | | | 5.00% | | | | 5.00% | |
Long-term rate of return on assets – Retirement Plan | | | 8.00% | | | | 8.00% | | | | 8.00% | |
The selection of the discount rate is made annually after comparison to yields based on high quality fixed-income investments. The salary scale is the composite rate which reflects anticipated inflation, merit increases, and promotions for the group of covered participants. The long-term rate of return is a composite rate for the trust. It is derived as the sum of the percentages invested in each principal asset class included in the portfolio multiplied by their respective expected rates of return. We considered the historical returns and the future expectations for returns for each asset class, as well as the target asset allocation of the pension portfolio. This analysis resulted in the selection of 8.00% as the long-term rate of return assumption for 2011.
The assumptions used to develop the actuarial present value of the benefit obligations for both plans are shown below:
| | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | | | 2009 | |
| | | |
Discount rate – Retirement Plan | | | 4.19% | | | | 5.30% | | | | 5.82% | |
Salary scale increases – Retirement Plan | | | 3.50% | | | | 4.00% | | | | 4.00% | |
Salary scale increases – SRP | | | 5.00% | | | | 5.00% | | | | 5.00% | |
The expected contribution to be paid for the Retirement Plan by us during 2012 is approximately $2.5 million. The expected benefit payments for the next 10 years for both plans are as follows (in thousands):
| | | | |
2012 | | $ | 4,218 | |
2013 | | | 2,096 | |
2014 | | | 2,689 | |
2015 | | | 4,744 | |
2016 | | | 3,028 | |
2017-2021 | | | 54,910 | |
The participant data used in determining the liabilities and costs for the Retirement Plan was collected as of January 1, 2011, and no significant changes have occurred through December 31, 2011. The participant data used in determining the liabilities and costs for the SRP was collected as of December 31, 2011.
At December 31, 2011, our investment asset allocation compared to our benchmarking allocation model for our plan assets was as follows:
| | | | | | | | |
| | | Portfolio | | | Benchmark | |
Cash | | | 8% | | | | 5% | |
U.S. Stocks | | | 43% | | | | 52% | |
Non-U.S. Stocks | | | 16% | | | | 9% | |
Bonds | | | 32% | | | | 34% | |
Other | | | 1% | | | | - | |
| | | | | | | | |
Total | | | 100% | | | | 100% | |
| | | | | | | | |
The fair value of plan assets was determined based on publicly quotedpublicly-quoted market prices for identical assets, which are classified as Level 1 observable inputs.assets. The allocation of the fair value of plan assets was as follows:
| | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
Cash and short-term investments | | | 3% | | | | 3% | |
Large company funds | | | 21% | | | | 20% | |
Mid company funds | | | 7% | | | | 7% | |
Small company funds | | | 4% | | | | 5% | |
International funds | | | 15% | | | | 17% | |
Fixed income funds | | | 36% | | | | 34% | |
Growth funds | | | 14% | | | | 14% | |
| | | | | | | | |
| | |
Total | | | 100% | | | | 100% | |
| | | | | | | | |
Concentrations of risk within our equity portfolio are investments classified within the following sectors: technology, industrial, financial services, consumer cyclical goods and healthcare, which represents approximately 17%, 14%, 14%, 13% and 12% of total equity investments, respectively.
Note 20. Related Parties
Through our management activities and transactions with our real estate joint ventures and partnerships, we had net accounts receivable of $2.2 million and $2.7 million outstanding as of December 31, 2011 and 2010, respectively. We also had accounts payable and accrued expenses of $8.2 million and $9.6 million outstanding as of December 31, 2011 and 2010, respectively. For the year ended December 31, 2011, 2010 and 2009, we recorded joint venture fee income of $6.0 million, $5.8 million and $5.7 million, respectively.
In August 2011, we entered intotime deposit is a purchase agreement to sell our 47.8% unconsolidated joint venture interest in a Colorado development project to our partner with gross sales proceeds totaling $29.1 million, which includes the assumption of our share of debt. In February 2012, we assigned this interest to our partner, which will generate an estimated gain $3.5 million.
As of March 31, 2010, we contributed the final two properties to an unconsolidated joint venture for $47.3 million, which included loan assumptions of $28.1 million and the receipt of net proceeds totaling $14.0 million.
In November 2010, we sold an unconsolidated real estate joint venture interest in a Texas property to our partner with gross sales proceeds totaling $1.4 million, which generated a gain of $1.3 million.
Note 21. Commitments and Contingencies
We are primarily engagedshort-term investment tradeable in the operation of shopping centers, which are either owned or,secondary market and reflects current rates for a deposit with respectsimilar maturity and credit quality. The deferred compensation plan obligations corresponds to certain shopping centers, operated under long-term ground leases. These ground leases expire at various dates through 2069, with renewal options. Space in our shopping centers is leased to tenants pursuant to agreements that provide for terms ranging generally from one year to 25 years and, in some cases, for annual rentals subject to upward adjustments based on operating expense levels, sales volume, or contractual increases as defined in the lease agreements.
Scheduled minimum rental payments under the terms of all non-cancelable operating leases in which we are the lessee, principally for shopping center ground leases, for the subsequent five years and thereafter ending December 31, are as follows (in thousands):
| | | | |
2012 | | $ | 3,569 | |
2013 | | | 3,519 | |
2014 | | | 3,183 | |
2015 | | | 2,956 | |
2016 | | | 2,623 | |
Thereafter | | | 121,295 | |
| | | | |
Total | | $ | 137,145 | |
| | | | |
Rental expense for operating leases was, in millions: $5.4 in 2011; $5.3 in 2010 and $5.0 in 2009.
The scheduled future minimum revenues under subleases, applicable to the ground lease rentals above, under the terms of all non-cancelable tenant leases, assuming no new or renegotiated leases or option extensions for the subsequent five years and thereafter ending December 31, are as follows (in thousands):
| | | | |
2012 | | $ | 38,282 | |
2013 | | | 34,673 | |
2014 | | | 28,723 | |
2015 | | | 22,891 | |
2016 | | | 19,623 | |
Thereafter | | | 79,321 | |
| | | | |
Total | | $ | 223,513 | |
| | | | |
Property under capital leases that is included in buildings and improvements consisted of two shopping centers totaling $16.8 million at December 31, 2011 and 2010. Amortization of property under capital leases is included in depreciation and amortization expense, and the balance of accumulated depreciation associated with these capital leases at December 31, 2011 and 2010 was $10.6 million and $9.8 million, respectively. Future minimum lease payments under these capital leases total $33.8 million of which $12.8 million represents interest. Accordingly, the present value of the net minimum lease payments was $21.0 million at December 31, 2011.
The annual future minimum lease payments under capital leases as of December 31, 2011 are as follows (in thousands):
| | | | |
2012 | | $ | 1,763 | |
2013 | | | 1,816 | |
2014 | | | 1,825 | |
2015 | | | 1,834 | |
2016 | | | 1,843 | |
Thereafter | | | 24,714 | |
| | | | |
Total | | $ | 33,795 | |
| | | | |
As of December 31, 2011, we participate in four real estate ventures structured as DownREIT partnerships that have properties in Arkansas, California, North Carolina, Texas and Utah. As a general partner, we have operating and financial control over these ventures and consolidate them in our consolidated financial statements. These ventures allow the outside limited partners to exchange their interest in the partnership for our common shares or an equivalent amount in cash. We may acquire any limited partnership interests that are put to the partnership, and we have the option to redeem the interest in cash or a fixed number of our common shares, at our discretion. We also participate in a real estate venture that has a property in Texas that allows its outside partner to put operating partnership units to us. We have the option to redeem these units in cash or a fixed number of our common shares, at our discretion. In 2010, we issued common shares valued at $.7 million in exchange for certain of these interests. No common shares were issued in exchange for any of these interests in 2011. The aggregate redemption value of these interests was approximately $35 million and $39 million as of December 31, 2011 and 2010, respectively.
In January 2007, we acquired two retail properties in Arizona. This purchase transaction included an earnout provision of approximately $29 million that was contingent upon the subsequent development of space by the property seller. This contingency agreement expired in July 2010, of which we have paid $18.9 million since inception through the final settlement in January 2011. Amounts paid under this earnout provision were treated as additional purchase price and capitalized to the related property.
We are subject to numerous federal, state and local environmental laws, ordinances and regulations in the areas where we own or operate properties. We are not aware of any contamination which may have been caused by us or any of our tenants that would have a material effect on our consolidated financial statements.
As part of our risk management activities, we have applied and been accepted into state sponsored environmental programs which will limit our expenses if contaminants need to be remediated. We also have an environmental insurance policy that covers us against third party liabilities and remediation costs.
While we believe that we do not have any material exposure to environmental remediation costs, we cannot give absolute assurance that changes in the law or new discoveries of contamination will not result in additional liabilities to us.
Related to our investment in a development project in Sheridan, Colorado, we, our joint venture partner and the joint venture have each provided a guaranty for the payment of any debt service shortfalls on tax increment revenue bonds issued in connection with the project. In 2007, the Agency issued $97 million of Series A bonds used for an urban renewal project. The bonds are to be repaid with incremental sales and property taxes and a PIF to be assessed on current and future retail sales, and, to the extent necessary, any amounts we may have to provide under a guaranty. The incremental taxes and PIF are to remain intact until the earlier of the bond liability has been paid in full or 2030 (unless such date is otherwise extended by the Agency).
In connection with the above project and a lawsuit settlement in 2009, the joint venture purchased a portion of the bonds in the amount of $51.3 million at par, and we established a $46.3 million letter of credit.
On April 28, 2011, the Agency remarketed the bonds, which included an extension of the incremental taxes and PIF for an additional 10 years. All of the outstanding bonds were recalled by the Agency and replaced with $74.1 million in senior bonds and $57.7 million in subordinate bonds. This transaction resulted in us receiving approximately $16.5 million in cash proceeds and $57.7 million in new subordinated bonds replacing the face value of our $51.3 million of senior bonds and $22.4 million of subordinate bonds. The subordinate bonds had been previously written down to a fair value of $10.7 million. Upon the completion of this transaction, we recorded a net credit loss on the exchange of bonds of approximately $18.7 million, and our $46.3 million letter of credit was terminated.
During 2011, we filed a lawsuit against our joint venture partner in connection with the above project for failure to perform on the joint venture’s past due intercompany note payable to us, which has been eliminated in our consolidated financial statements. We are also involved in one consolidated and three unconsolidated joint ventures with this partner. To date, we are unable to determine the outcome of the lawsuit or its potential effects on our other joint ventures.
We have entered into commitments aggregating $86.1 million comprised principally of construction contracts which are generally due in 12 to 36 months.
We are also involved in various matters of litigation arising in the normal course of business. While we are unable to predict with certainty the amounts involved, our management and counsel are of the opinion that, when such litigation is resolved, any additional liability, if any, will not have a material effect on our consolidated financial statements.
Note 22. Variable Interest Entities
Consolidated VIEs:
Two of our real estate joint ventures whose activities principally consist of owning and operating 30 neighborhood/community shopping centers, of which 22 are located in Texas, three in Georgia, two each in Tennessee and Florida and one in North Carolina, were determined to be VIEs. These VIEs have financing agreements that are guaranteed solely by us for tax planning purposes. We have determined that we are the primary beneficiary and have consolidated these joint ventures.
A summary of our consolidated VIEs is as follows (in thousands):
| | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
| | |
Maximum Risk of Loss (1) | | $ | 138,176 | | | $ | 157,353 | |
Assets held by VIEs | | | 309,387 | | | | 280,285 | |
Assets held as collateral for debt | | | 250,105 | | | | 253,617 | |
| (1) | The maximum risk of loss has been determined to be limited to our guaranties of debt for each real estate joint venture.
|
Restrictions on the use of these assets are significant because they are collateral for the VIEs’ debt, and we would generally be required to obtain our partners’ approval in accordance with the joint venture agreements for any major transactions. Transactions with these joint ventures on our consolidated financial statements have been limited to changes in noncontrolling interests and reductions in debt from our partners’ contributions. We and our partners are subject to the provisions of the joint venture agreements which include provisions for when additional contributions may be required including operating cash shortfalls and unplanned capital expenditures. We have not provided any additional support to the VIEs as of December 31, 2011.
Unconsolidated VIEs:
At December 31, 2011, three unconsolidated real estate joint ventures were determined to be VIEs. Two unconsolidated real estate joint ventures were determined to be VIEs through the issuance of secured loans, of which $21.4 million of debt associated with a tenancy-in-common arrangement is recorded in our Consolidated Balance Sheet, since the lenders have the ability to make decisions that could have a significant impact on the success of the entities. In addition, we have another unconsolidated real estate joint venture with an interest in an entity, which is deemed to be a VIE since the unconsolidated joint venture provided a guaranty for the entity’s debt. A summary of our unconsolidated VIEs is as follows (in thousands):
| | | | | | | | |
| | | December 31, | |
| | | 2011 | | | 2010 | |
| | |
Investment in Real Estate Joint Ventures and Partnerships, net (1) | | $ | 30,377 | | | $ | 11,581 | |
Maximum Risk of Loss (2) | | | 75,274 | | | | 56,448 | |
| (1) | The carrying amount of the investments represents our contributions to the real estate joint ventures net of any distributions made and our portion of the equity in earnings of the joint ventures.
|
| (2) | The maximum risk of loss has been determined to be limited to our debt exposure for each real estate joint venture.
|
We and our partners are subject to the provisions of the joint venture agreements that specify conditions, including operating shortfalls and unplanned capital expenditures, under which additional contributions may be required.
Note 23. Business Combinations
Effective April 13, 2011, we acquired our partner’s 50% interest in an unconsolidated joint venture (“Palm Coast”) related to a development property in Palm Coast, Florida, which resulted in the consolidation of this property within our shopping center segment. Management has determined that this transaction qualified as a business combination to be accounted for under the acquisition method.
Effective April 1, 2010, we assumed control of two 50%-owned unconsolidated joint ventures (“Sheridan”) related to a development project in Sheridan, Colorado, which resulted in the consolidation of these joint ventures within our shopping center segment that had previously been accounted for under the equity method. Control was assumed through a modification of the joint venture agreements in which we assumed all management, voting and approval rights without transferring consideration to our joint venture partner. Each partner’s percentage interest in the joint ventures remained unchanged. Management has determined that these transactions qualified as business combinations to be accounted for under the acquisition method.
Accordingly, the assets and liabilities of these transactions were recorded in our consolidated balance sheet at their estimated fair values as of their respective effective date, with any applicable partner’s share of the resulting net change included in noncontrolling interests. Fair value of assets acquired, liabilities assumed and equity interests was estimated using market-based measurements, including cash flow and other valuation techniques. The fair value measurement is based on both significant inputs for similar assets and liabilities in comparable markets and significant inputs that are not observable in the markets in accordance with our fair value measurements accounting policy. Key assumptions include third-party broker valuation estimates, discount rate of 8% as of April 13, 2011, and discount rates ranging from 8% to 17% as of April 1, 2010, a terminal capitalization rate for similar properties, and factors that we believe market participants would consider in estimating fair value. The results of these transactions are included in our Consolidated Statements of Operations and Comprehensive Income beginning April 13, 2011 and April 1, 2010, respectively.
The following table summarizes the transactions related to the business combinations, including the assets acquired and liabilities assumed as indicated (in thousands):
| | | | | | | | |
| | | Palm Coast
April 13,
2011 | | | Sheridan
April 1,
2010 | |
| | |
Fair value of our equity interests before business combinations | | $ | 7,578 | | | $ | (21,858) | |
| | |
Fair value of consideration transferred | | $ | 11,462 | (1) | | $ | - | |
| | |
Amounts recognized for assets and liabilities assumed: | | | | | | | | |
Assets: | | | | | | | | |
Property | | $ | 32,807 | | | $ | 32,940 | |
Unamortized debt and lease costs | | | 2,421 | | | | 5,182 | |
Accrued rent and accounts receivable | | | 211 | | | | 213 | |
Cash and cash equivalents | | | 1,402 | | | | 1,522 | |
Other, net | | | 694 | | | | 151,464 | (2) |
Liabilities: | | | | | | | | |
Debt, net | | | - | | | | (101,741) | (3) |
Accounts payable and accrued expenses | | | (137) | | | | (647) | |
Other, net | | | (318) | | | | (1,334) | |
| | | | | | | | |
Total net assets | | $ | 37,080 | | | $ | 87,599 | |
| | |
Noncontrolling interests of the real estate joint ventures | | $ | - | | | $ | (18,573) | |
| (1) | Consideration included $.5 million of cash and $11.0 million in debt settlement.
|
| (2) | Included primarily a $97.0 million debt service guaranty asset, tax increment revenue bonds of $51.3 million and intangible and other assets.
|
| (3) | Excluded the effect of $123.9 million in intercompany debt that is eliminated upon consolidation.
|
As a result of the Palm Coast acquisition, we recognized a gain of $4.6 million which is attributable to the realization upon consolidation of our preferred return on equity. For the year ended December 31, 2011, this gain is included in discontinued operations in the Consolidated Statements of Operations and Comprehensive Income as the property had been sold as of December 31, 2011. Additionally, as a result of our Sheridan business combination, we recognized an impairment loss of $15.8 million as a result of revaluing our 50% equity interest held in the real estate joint ventures before the business combinations, which is reported as an impairment loss in the Consolidated Statements of Operations and Comprehensive Income for the year ended December 31, 2010.
The following table summarizes the impact to revenues and net (loss) income attributable to common shareholders from our business combinations as follows (in thousands):
| | | | | | | | |
| | | Year Ended December 31, | |
| | | 2011 | | | 2010 | |
Palm Coast: | | | | | | | | |
Increase in revenues | | $ | 2,164 | | | | | |
Decrease in net income attributable to common shareholders | | | (510) | | | | | |
| | |
Sheridan: | | | | | | | | |
Increase in revenues | | | | | | $ | 1,646 | |
Decrease in net income attributable to common shareholders | | | | | | | (2,501) | |
The following table summarizes the pro forma impact of the real estate joint ventures as if Palm Coast and Sheridan had been consolidated on January 1, 2009, the earliest year presented, as follows (in thousands, except per share amounts):
| | | | | | | | | | | | |
| | | Pro Forma
2011(1) | | | Pro Forma
2010(1) | | | Pro Forma
2009(1) | |
Revenues | | $ | 542,475 | | | $ | 538,955 | | | $ | 556,717 | |
Net income | | | 16,674 | | | | 50,675 | | | | 169,224 | |
Net (loss) income attributable to common shareholders | | | (19,920) | | | | 10,482 | | | | 134,898 | |
Earnings per share – basic | | | (0.17) | | | | 0.09 | | | | 1.23 | |
Earnings per share – diluted | | | (0.17) | | | | 0.09 | | | | 1.22 | |
| (1) | There are no non-recurring pro forma adjustments included within or excluded from the amounts in the preceding table.
|
Note 24. Fair Value Measurements
Recurring Fair Value Measurements:
a grantor trust. Investments Held in Grantor Trusts
These assets are valued based on publicly quoted market prices for identical assets.
Tax Increment Revenue Bonds
These assets represent tax increment revenue bonds which were issued by the Agency in connection with our investment in a development project in Sheridan, Colorado.The senior tax increment revenue bonds were valued based on quoted prices for similar assets in an active market. As a result, we have determined that the senior tax increment revenue bonds are classified within Level 2 of the fair value hierarchy. The valuation of our subordinated tax increment revenue bonds was determined based on assumptions that management believes market participants would use in pricing, using widely accepted valuation techniques including discounted cash flow analysis based on the expected future sales tax revenues of the development project. This analysis reflected the contractual terms of the bonds, including the periodheld to maturity are carried at amortized cost and used observable market-based inputs, such as market discount ratesare adjusted using the interest method for amortization of premiums and unobservable market-based inputs, such as future growth and inflation rates. Since the majorityaccretion of our inputs were unobservable, we have determined that the subordinate tax increment revenue bonds fall within the Level 3 classification of the fair value hierarchy. At December 31, 2010, the carrying value of these bonds was equal to its fair value. During 2011, these bonds were recalled by the Agency.
discounts.
We use interest rate contracts with major financial institutions to manage our interest rate risk. The valuation of these instruments is determined based on assumptions that management believes market participants would use in pricing, using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. The fair values of our interest rate contracts have been determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves.
We incorporate credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counter-party’s nonperformance risk in the fair value measurements. In adjusting the fair value of our derivative contracts for the effect of nonperformance risk, we have considered the impact of netting and any applicable credit enhancements, such as collateral, thresholds and guarantees.
An accounting policy election was made to measure the credit risk of its derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio.
Although we have determined that the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by ourselves and our counter-parties. However, we have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and have determined that the credit valuation adjustments are not significant to the overall valuation of our derivatives. As a result, we have determined that the derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy.
Notes Receivable from Real Estate Joint Ventures and Partnerships
We estimate the fair value of our notes receivable from real estate joint ventures and partnerships using quoted market prices for publicly-traded notes and discounting estimated future cash receipts. The discount rates used approximate current lending rates for a note or groups of notes with similar maturities and credit quality, assumes the note is outstanding through maturity and considers the note’s collateral (if applicable). We utilize market information as available or present value techniques to estimate the amounts required to be disclosed.
Tax Increment Revenue Bonds
The fair value estimates of our held to maturity tax increment revenue bonds, which were issued by the Agency in connection with our investment in a development project in Sheridan, Colorado, are based on assumptions that management believes market participants would use in pricing, using widely accepted valuation techniques including discounted cash flow analysis based on the expected future sales tax revenues of the development project. This analysis reflects the contractual terms of the bonds, including the period to maturity, and uses observable market-based inputs, such as market discount rates and unobservable market-based inputs, such as future growth and inflation rates.
Debt
The fair value of our debt may be based on quoted market prices for publicly-traded debt, on a third-party established benchmark for inactively traded debt and on the discounted estimated future cash payments to be made for non-traded debt. For inactively traded debt, our third-party provider establishes a benchmark for all REIT securities based on the largest, most liquid and most frequent investment grade securities in the REIT bond market. This benchmark is then adjusted to consider how a market participant would be compensated for risk premiums such as, longevity of maturity dates, lack of liquidity and credit quality of the issuer. The discount rates used approximate current lending rates for loans or groups of loans with similar maturities and credit quality, assumes the debt is outstanding through maturity and considers the debt’s collateral (if applicable). We have utilized market information as available or present value techniques to estimate the amounts required to be disclosed.
Reportable Segments
Our primary focus is to lease space to tenants in shopping centers that we own, lease or manage. Historically, we reviewed operating and financial information for each property by commercial use and on an individual basis. Each commercial use or each property represents an individual operating segment.
We evaluate the performance of the reportable segments based on net operating income, defined as total revenues less operating expenses and real estate taxes. Management does not consider the effect of gains or losses from the sale of property or interests in real estate joint ventures and partnerships in evaluating segment operating performance.
With the sale of our industrial portfolio in May 2012, we no longer analyze our properties by commercial use. Further, no individual property constitutes more than 10% of our revenues, net operating income or assets, and we have no operations outside of the United States of America. Therefore, our properties have been aggregated into one reportable segment since such properties and the tenants thereof each share similar economic and operating characteristics.
Accumulated Other Comprehensive Loss
Changes in accumulated other comprehensive loss by component consists of the following (in thousands):
|
| | | | | | | | | | | | | | | |
| | Gain on Investments | | Gain on Cash Flow Hedges | | Defined Benefit Pension Plan | | Total |
| Balance, December 31, 2013 | $ | (340 | ) | | $ | (1,233 | ) | | $ | 5,775 |
| | $ | 4,202 |
|
Change excluding amounts reclassified from accumulated other comprehensive loss | (354 | ) | | (131 | ) | | 11,118 |
| | 10,633 |
|
Amounts reclassified from accumulated other comprehensive loss | 38 |
| (1) | (2,052 | ) | (2) | (385 | ) | (3) | (2,399 | ) |
| Net other comprehensive (income) loss | (316 | ) | | (2,183 | ) | | 10,733 |
| | 8,234 |
|
| Balance, December 31, 2014 | $ | (656 | ) | | $ | (3,416 | ) | | $ | 16,508 |
| | $ | 12,436 |
|
| | | | | | | | |
| | Gain on Investments | | (Gain) Loss on Cash Flow Hedges | | Defined Benefit Pension Plan | | Total |
| Balance, December 31, 2012 | $ | — |
| | $ | 7,489 |
| | $ | 17,254 |
| | $ | 24,743 |
|
Change excluding amounts reclassified from accumulated other comprehensive loss | (340 | ) | | (6,423 | ) | | (10,200 | ) | | (16,963 | ) |
Amounts reclassified from accumulated other comprehensive loss | — |
| | (2,299 | ) | (2) | (1,279 | ) | (3) | (3,578 | ) |
| Net other comprehensive income | (340 | ) | | (8,722 | ) | | (11,479 | ) | | (20,541 | ) |
| Balance, December 31, 2013 | $ | (340 | ) | | $ | (1,233 | ) | | $ | 5,775 |
| | $ | 4,202 |
|
___________________
| |
| (1) | This reclassification component is included in interest and other income. |
| |
| (2) | This reclassification component is included in interest expense (see Note 8 for additional information). |
| |
| (3) | This reclassification component is included in the computation of net periodic benefit cost (see Note 19 for additional information). |
Reclassifications
The reclassification of prior years’ operating results for certain properties classified as discontinued operations was made to conform to the current year presentation (see Note 15 and 17 for additional information). These items had no impact on previously reported net income, the consolidated balance sheet or cash flows.
Note 2. Newly Issued Accounting Pronouncements
In February 2013, the FASB issued ASU No. 2013-04, "Obligations Resulting From Joint and Several Liability Arrangements for Which the Total Amount of the Obligation is Fixed at the Reporting Date." This ASU requires an entity to measure obligations resulting from joint and several liability arrangements for which the total amount of the obligation is fixed at the reporting date, as the sum of (1) the amount the reporting entity has agreed to pay in accordance to the arrangement and (2) any additional amounts the reporting entity expects to pay on behalf of its co-obligors. Additional disclosures on the nature and amounts of the obligation will also be required. The provisions of ASU No. 2013-04 were effective for us on January 1, 2014, and were required to be applied retrospectively. The ASU did not materially impact our consolidated financial statements.
In July 2013, the FASB issued ASU No. 2013-11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists." This ASU amends current GAAP to require entities to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, as a reduction to a deferred tax asset for net operating loss or other tax credit carryforwards when settlement is available under the tax law. The provisions of ASU No. 2013-11 were effective for us on January 1, 2014, and were required to be applied to all unrecognized tax benefits in existence. The adoption of this ASU did not materially impact our consolidated financial statements.
In April 2014, the FASB issued ASU No. 2014-08, "Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity." This ASU amends the criteria for reporting discontinued operations while enhancing disclosures in this area. The provisions of ASU No. 2014-08 are effective for us prospectively on January 1, 2015; however, early adoption is permitted. We adopted this update effective April 1, 2014. The adoption resulted in individual property disposals no longer qualifying for discontinued operations presentation; thus, the results of these disposals will remain in income from continuing operations, and any associated gains are included in gain on sale of property. Properties sold or classified as held for sale prior to April 1, 2014, are not subject to ASU No. 2014-08 and therefore, continue to be classified as discontinued operations using the previous definition.
In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers." This ASU's core objective is for an entity to recognize revenue based on the consideration it expects to receive in exchange for goods or services. Additionally, this ASU requires entities to use a single model in accounting for revenues derived from contracts with customers. ASU No. 2014-09 replaces prior guidance regarding the recognition of revenue from sales of real estate except for revenue from sales that are part of a sale-leaseback transaction. The provisions of ASU No. 2014-09 are effective for us on January 1, 2017, and are required to be applied either on a retrospective or a modified retrospective approach. We are currently assessing the impact, if any, that the adoption of this ASU will have on our consolidated financial statements.
In August 2014, the FASB issued ASU No. 2014-15, "Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern." This ASU's core objective is that management should evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issuedor are available to be issued. The provisions of ASU No. 2014-15 are effective for us as of December 31, 2016, and early adoption is permitted. We do not expect the adoption of this update to have any impact to our consolidated financial statements.
In January 2015, the FASB issued ASU No. 2015-01, "Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items." This ASU eliminates the concept of extraordinary items from GAAP. The provisions of ASU No. 2015-01 are effective for us as of January 1, 2016, and early adoption is permitted. We plan to adopt this ASU on January 1, 2015, and we do not expect the adoption of this update to have any impact to our consolidated financial statements.
Note 3. Property
Our property consisted of the following (in thousands):
|
| | | | | | | |
| | December 31, |
| | 2014 | | 2013 |
| Land | $ | 821,614 |
| | $ | 854,409 |
|
| Land held for development | 103,349 |
| | 116,935 |
|
| Land under development | 24,297 |
| | 4,262 |
|
| Buildings and improvements | 3,061,616 |
| | 3,238,817 |
|
| Construction in-progress | 65,218 |
| | 74,853 |
|
| Total | $ | 4,076,094 |
| | $ | 4,289,276 |
|
During the year ended December 31, 2014, we sold 26 centers and other property. Aggregate gross sales proceeds from these transactions approximated $362.4 million and generated gains of approximately $167.6 million. Included in these transactions is the exercise of a purchase option by a holder of our ground leases in Texas that resulted in the disposition of three properties. Also, during the year ended December 31, 2014, we acquired one center with a gross purchase price of approximately $43.8 million and invested $47.4 million in new development projects.
At December 31, 2014, we classified one property as held for sale totaling $9.4 million before accumulated depreciation that did not qualify to be reported as discontinued operations. Subsequent to December 31, 2014, the property classified as held for sale was sold. We classified eight properties as held for sale as of December 31, 2013, totaling $155.0 million before accumulated depreciation (see Note 15 for additional information).
Note 4. Investment in Real Estate Joint Ventures and Partnerships
We own interests in real estate joint ventures or limited partnerships and have tenancy-in-common interests in which we exercise significant influence, but do not have financial and operating control. We account for these investments using the equity method, and our interests range from 20% to 75% for the periods presented. Combined condensed financial information of these ventures (at 100%) is summarized as follows (in thousands):
|
| | | | | | | |
| | December 31, |
| | 2014 | | 2013 |
| Combined Condensed Balance Sheets | | | |
| | | | |
| ASSETS | | | |
| Property | $ | 1,331,445 |
| | $ | 1,401,982 |
|
| Accumulated depreciation | (279,067 | ) | | (261,454 | ) |
| Property, net | 1,052,378 |
| | 1,140,528 |
|
| Other assets, net | 126,890 |
| | 142,638 |
|
| Total Assets | $ | 1,179,268 |
| | $ | 1,283,166 |
|
| | | | |
| LIABILITIES AND EQUITY | | | |
| Debt, net (primarily mortgages payable) | $ | 380,816 |
| | $ | 453,390 |
|
| Amounts payable to Weingarten Realty Investors and Affiliates | 13,749 |
| | 30,214 |
|
| Other liabilities, net | 26,226 |
| | 29,711 |
|
| Total Liabilities | 420,791 |
| | 513,315 |
|
| Equity | 758,477 |
| | 769,851 |
|
| Total Liabilities and Equity | $ | 1,179,268 |
| | $ | 1,283,166 |
|
|
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Combined Condensed Statements of Operations | | | | | |
| Revenues, net | $ | 153,301 |
| | $ | 165,365 |
| | $ | 195,109 |
|
| Expenses: | | | | | |
| Depreciation and amortization | 40,235 |
| | 45,701 |
| | 59,330 |
|
| Interest, net | 22,657 |
| | 28,787 |
| | 35,491 |
|
| Operating | 27,365 |
| | 28,929 |
| | 34,989 |
|
| Real estate taxes, net | 18,159 |
| | 18,929 |
| | 23,899 |
|
| General and administrative | 916 |
| | 934 |
| | 1,106 |
|
| Provision for income taxes | 417 |
| | 278 |
| | 316 |
|
| Impairment loss | 1,526 |
| | 1,887 |
| | 96,781 |
|
| Total | 111,275 |
| | 125,445 |
| | 251,912 |
|
| Operating income (loss) | $ | 42,026 |
| | $ | 39,920 |
| | $ | (56,803 | ) |
Our investment in real estate joint ventures and partnerships, as reported in our Consolidated Balance Sheets, differs from our proportionate share of the entities’ underlying net assets due to basis differences, which arose upon the transfer of assets to the joint ventures. The net positive basis differences, which totaled $5.2 million and $6.1 million at December 31, 2014 and 2013, respectively, are generally amortized over the useful lives of the related assets.
Our real estate joint ventures and partnerships have determined from time to time that the carrying amount of certain properties was not recoverable and that the properties should be written down to fair value. For the year ended December 31, 2014, 2013 and 2012, our unconsolidated real estate joint ventures and partnerships recorded an impairment charge of $1.5 million, $1.9 million and $96.8 million, respectively, associated primarily with various properties that are being either marketed for sale, have been sold or with shorter holding periods of finite life joint ventures where the joint ventures’ ability to recover the carrying cost of the property may be limited by the term of the venture life.
Fees earned by us for the management of these real estate joint ventures and partnerships totaled $4.6 million in 2014, $5.0 million in 2013 and $6.1 million in 2012.
During 2014, we had a partial disposition of a 50% interest at an unconsolidated real estate joint venture for approximately $5.1 million, resulting in a gain on our investment of $1.7 million. Also, we sold four centers and other property held in unconsolidated real estate joint ventures, for approximately $19.9 million, of which our share of the gain totaled $4.9 million.
During 2013, the final two industrial properties in an unconsolidated real estate joint venture were sold. This joint venture was liquidated resulting in an $11.5 million gain on our investment. Also, three shopping centers were sold, and our gross sales proceeds from the disposition of these five properties totaled $35.5 million, of which our share of the gain totaled $16.0 million. Furthermore, we sold our 10% interest in two unconsolidated tenancy-in-common arrangements and two unconsolidated real estate joint ventures that we previously accounted for under the equity method, for approximately $15.7 million, resulting in a gain of $1.9 million.
During 2013, a 51% owned unconsolidated real estate joint venture acquired real estate assets of approximately $41.2 million. We also acquired our partner’s 50% unconsolidated real estate joint venture interest in a California property that we had previously accounted for under the equity method. This transaction resulted in the consolidation of the property in our consolidated financial statements (see Note 23 for additional information).
Note 5. Notes Receivable from Real Estate Joint Ventures and Partnerships
We have ownership interests in a number of real estate joint ventures and partnerships. At December 31, 2014, we had no outstanding notes receivable from real estate joint ventures and partnerships. At December 31, 2013, various notes receivable from these entities bore interest ranging from approximately 2.9% to 5.7% per year and matured at various dates through 2017. Generally, these notes receivable were secured by underlying real estate assets.
The outstanding notes were fully paid during 2014, and no write-offs occurred. Interest income recognized on these notes was $.1 million, $2.2 million and $3.0 million for the year ended December 31, 2014, 2013 and 2012, respectively.
In December 2013, we acquired our partner’s 50% unconsolidated joint venture interest in a California property, which includes the settlement of $54.8 million of our notes receivable from real estate joint ventures and partnerships.
Note 6. Identified Intangible Assets and Liabilities
Identified intangible assets and liabilities associated with our property acquisitions are as follows (in thousands):
|
| | | | | | | |
| | December 31, |
| | 2014 | | 2013 |
| Identified Intangible Assets: | | | |
| Above-market leases (included in Other Assets, net) | $ | 38,121 |
| | $ | 38,577 |
|
| Above-market leases - Accumulated Amortization | (11,331 | ) | | (8,767 | ) |
| Below-market assumed mortgages (included in Debt, net) | 4,713 |
| | 4,713 |
|
| Below-market assumed mortgages - Accumulated Amortization | (2,352 | ) | | (1,900 | ) |
| Valuation of in place leases (included in Unamortized Debt and Lease Costs, net) | 132,554 |
| | 140,457 |
|
| Valuation of in place leases - Accumulated Amortization | (56,571 | ) | | (48,961 | ) |
| | $ | 105,134 |
| | $ | 124,119 |
|
| Identified Intangible Liabilities: | | | |
| Below-market leases (included in Other Liabilities, net) | $ | 42,830 |
| | $ | 44,086 |
|
| Below-market leases - Accumulated Amortization | (19,612 | ) | | (19,185 | ) |
| Above-market assumed mortgages (included in Debt, net) | 34,113 |
| | 40,465 |
|
| Above-market assumed mortgages - Accumulated Amortization | (27,411 | ) | | (31,114 | ) |
| | $ | 29,920 |
| | $ | 34,252 |
|
These identified intangible assets and liabilities are amortized over the applicable lease terms or the remaining lives of the assumed mortgages, as applicable.
The net amortization of above-market and below-market leases (decreased) increased rental revenues by $(1.7) million, $.6 million and $.8 million in 2014, 2013 and 2012, respectively. The significant year over year change in rental revenues from 2014 to 2013 is primarily due to the acquisition of a partner’s 50% interest in an unconsolidated joint venture in December 2013 (see Note 23 for additional information). The estimated net amortization of these intangible assets and liabilities will decrease rental revenues for each of the next five years as follows (in thousands):
|
| | | |
| 2015 | $ | 1,681 |
|
| 2016 | 1,574 |
|
| 2017 | 1,473 |
|
| 2018 | 1,309 |
|
| 2019 | 815 |
|
The amortization of the in place lease intangible assets recorded in depreciation and amortization, was $12.0 million, $11.6 million and $7.8 million in 2014, 2013 and 2012, respectively. The estimated amortization of this intangible asset will increase depreciation and amortization for each of the next five years as follows (in thousands):
|
| | | |
| 2015 | $ | 10,756 |
|
| 2016 | 8,161 |
|
| 2017 | 7,635 |
|
| 2018 | 7,287 |
|
| 2019 | 6,208 |
|
The net amortization of above-market and below-market assumed mortgages decreased net interest expense by $1.0 million, $10.4 million and $2.7 million in 2014, 2013 and 2012, respectively. The significant year over year change in expense from 2013 to 2014 is primarily due to a $9.7 million write-off in 2013 of an above-market assumed mortgage intangible due to the early payoff of the related mortgage. The estimated net amortization of these intangible assets and liabilities will decrease net interest expense for each of the next five years as follows (in thousands):
|
| | | |
| 2015 | $ | 783 |
|
| 2016 | 750 |
|
| 2017 | 871 |
|
| 2018 | 978 |
|
| 2019 | 978 |
|
Note 7. Debt
Our debt consists of the following (in thousands):
|
| | | | | | | |
| | December 31, |
| | 2014 | | 2013 |
| Debt payable to 2038 at 3.4% to 8.6% in 2014 and 2.6% to 8.6% in 2013, net | $ | 1,656,083 |
| | $ | 2,205,104 |
|
| Unsecured notes payable under credit facilities | 189,000 |
| | — |
|
| Debt service guaranty liability | 72,105 |
| | 73,740 |
|
| Obligations under capital leases | 21,000 |
| | 21,000 |
|
| Total | $ | 1,938,188 |
| | $ | 2,299,844 |
|
The grouping of total debt between fixed and variable-rate as well as between secured and unsecured is summarized below (in thousands):
|
| | | | | | | |
| | December 31, |
| | 2014 | | 2013 |
| As to interest rate (including the effects of interest rate contracts): | | | |
| Fixed-rate debt | $ | 1,651,959 |
| | $ | 2,136,265 |
|
| Variable-rate debt | 286,229 |
| | 163,579 |
|
| Total | $ | 1,938,188 |
| | $ | 2,299,844 |
|
| As to collateralization: | | | |
| Unsecured debt | $ | 1,343,217 |
| | $ | 1,572,057 |
|
| Secured debt | 594,971 |
| | 727,787 |
|
| Total | $ | 1,938,188 |
| | $ | 2,299,844 |
|
We maintain a $500 million unsecured revolving credit facility, which was last amended and extended on April 18, 2013. This facility expires in April 2017, provides for two consecutive six-month extensions upon our request and borrowing rates that float at a margin over LIBOR plus a facility fee. At December 31, 2014, the borrowing margin and facility fee, which are priced off a grid that is tied to our senior unsecured credit ratings, are 115 and 20 basis points, respectively. The facility also contains a competitive bid feature that allows us to request bids for up to $250 million. Additionally, an accordion feature allows us to increase the facility amount up to $700 million.
Effective May 2010, we entered into an agreement with a bank for an unsecured and uncommitted overnight facility totaling $99 million that we maintained for cash management purposes. The facility provided for fixed interest rate loans at a 30 day LIBOR rate plus a borrowing margin based on market liquidity until expiration. As of January 2, 2015, this facility was canceled and has not been replaced.
The following table discloses certain information regarding our unsecured notes payable under our credit facilities (in thousands, except percentages):
|
| | | | | | | |
| | December 31, |
| | 2014 | | 2013 |
| Unsecured revolving credit facility: | | | |
| Balance outstanding | $ | 189,000 |
| | $ | — |
|
| Available balance | 306,777 |
| | 497,821 |
|
| Letter of credit outstanding under facility | 4,223 |
| | 2,179 |
|
| Variable interest rate (excluding facility fee) | 0.8 | % | | — | % |
| Unsecured and uncommitted overnight facility: | | | |
| Balance outstanding | $ | — |
| | $ | — |
|
| Variable interest rate | — | % | | — | % |
| Both facilities: | | | |
| Maximum balance outstanding during the year | $ | 270,000 |
| | $ | 265,500 |
|
| Weighted average balance | 151,036 |
| | 61,642 |
|
| Year-to-date weighted average interest rate (excluding facility fee) | 0.8 | % | | 1.0 | % |
Related to a development project in Sheridan, Colorado, we have provided a guaranty for the payment of any debt service shortfalls until a coverage rate of 1.4 is met on tax increment revenue bonds issued in connection with the project. The bonds are to be repaid with incremental sales and property taxes and a PIF to be assessed on current and future retail sales and, to the extent necessary, any amounts we may have to provide under a guaranty. The incremental taxes and PIF are to remain intact until the earlier of the date the bond liability has been paid in full or 2040. Therefore, a debt service guaranty liability equal to the fair value of the amounts funded under the bonds was recorded. As of December 31, 2014 and 2013, we had $72.1 million and $73.7 million, respectively, outstanding for the debt service guaranty liability.
During 2014, $315 million of fixed-rate medium term notes matured and were repaid at a weighted average interest rate of 5.2%, and $100 million of our 8.1% senior unsecured notes due 2019 were redeemed by us at our option. The majority of the 8.1% senior unsecured notes was redeemed at a purchase price of 100% of the principal amount, plus accrued and unpaid interest through the redemption date. In conjunction with the redemption in 2014, we wrote off $1.2 million of debt costs. During 2013, $173.6 million of fixed-rate medium term notes matured and were repaid at a weighted average interest rate of 5.4%, and a $100 million 6% secured fixed-rate note payable was repaid prior to maturity.
In October 2013, we issued $250 million of 4.45% senior unsecured notes maturing in 2024. The notes were issued at 99.58% of the principal amount with a yield to maturity of 4.50%. The net proceeds received of $247.3 million were used to reduce all amounts outstanding under our $500 million unsecured revolving credit facility, andnet excess proceeds were invested in short-term instruments and were used to pay down future debt maturities or for general business purposes.
In March 2013, we issued $300 million of 3.5% senior unsecured notes maturing in 2023. The notes were issued at 99.53% of the principal amount with a yield to maturity of 3.56%. The net proceeds received of $296.6 million were used to reduce amounts outstanding under our $500 million unsecured revolving credit facility, which included borrowings used to redeem $75 million of our 6.75% Series D Cumulative Redeemable Preferred Shares.
Various leases and properties, and current and future rentals from those leases and properties, collateralize certain debt. At December 31, 2014 and 2013, the carrying value of such property aggregated $1.0 billion and $1.2 billion, respectively.
Scheduled principal payments on our debt (excluding $189.0 million unsecured notes payable under our credit facilities, $21.0 million of certain capital leases, $3.9 million fair value of interest rate contracts, $(3.1) million net premium/(discount) on debt, $4.3 million of non-cash debt-related items, and $72.1 million debt service guaranty liability) are due during the following years (in thousands):
|
| | | |
| 2015 | $ | 225,946 |
|
| 2016 | 233,152 |
|
| 2017 | 139,660 |
|
| 2018 | 59,945 |
|
| 2019 | 53,556 |
|
| 2020 | 34,990 |
|
| 2021 | 1,883 |
|
| 2022 | 304,397 |
|
| 2023 | 301,494 |
|
| 2024 | 251,588 |
|
| Thereafter | 44,309 |
|
| Total | $ | 1,650,920 |
|
Our various debt agreements contain restrictive covenants, including minimum interest and fixed charge coverage ratios, minimum unencumbered interest coverage ratios, minimum net worth requirements and maximum total debt levels. We are not aware of any non-compliance with our public debt and revolving credit facility covenants as of December 31, 2014.
Note 8. Derivatives and Hedging
The fair value of all our interest rate contracts was reported as follows (in thousands):
|
| | | | | | | | | | | |
| | Assets | | Liabilities |
| | Balance Sheet Location | | Amount | | Balance Sheet Location | | Amount |
| Designated Hedges: | | | | | | | |
| December 31, 2014 | Other Assets, net | | $ | 3,891 |
| | Other Liabilities, net | | $ | 109 |
|
| December 31, 2013 | Other Assets, net | | 5,282 |
| | Other Liabilities, net | | 476 |
|
The gross presentation, the effects of offsetting for derivatives with a right to offset under master netting agreements and the net presentation of our interest rate contracts is as follows (in thousands):
|
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | Gross Amounts Not Offset in Balance Sheet | | |
| | Gross Amounts Recognized | | Gross Amounts Offset in Balance Sheet | | Net Amounts Presented in Balance Sheet | | Financial Instruments | | Cash Collateral Received | | Net Amount |
| December 31, 2014 | | | | | | | | | | | |
| Assets | $ | 3,891 |
| | $ | — |
| | $ | 3,891 |
| | $ | — |
| | $ | — |
| | $ | 3,891 |
|
| Liabilities | 109 |
| | — |
| | 109 |
| | — |
| | — |
| | 109 |
|
| | | | | | | | | | | | |
| December 31, 2013 | | | | | | | | | | | |
| Assets | 5,282 |
| | — |
| | 5,282 |
| | — |
| | — |
| | 5,282 |
|
| Liabilities | 476 |
| | — |
| | 476 |
| | — |
| | — |
| | 476 |
|
Cash Flow Hedges:
As of December 31, 2014, we had one interest rate contract, maturing in December 2015, with an aggregate notional amount of $5.2 million that was designated as a cash flow hedge and fixed the interest rate at 2.4%. As of December 31, 2013, we had three interest rate contracts, maturing through September 2017, with an aggregate notional amount of $25.8 million that were designated as cash flow hedges and either fixed or capped interest rates ranging from 2.3% to 5.0%. We have determined that these contracts are highly effective in offsetting future variable interest cash flows.
During 2013, we settled three forward-starting contracts with an aggregate notional amount of $150.0 million hedging future fixed-rate debt issuances. These contracts fixed the 10-year swap rates at 2.4%. In connection with the October 2013 issuance of unsecured senior notes, we received $6.1 million associated with the settlement of these contracts resulting in a $5.9 million gain in accumulated other comprehensive loss.
As of December 31, 2014 and 2013, the net gain balance in accumulated other comprehensive loss relating to cash flow interest rate contracts was $3.4 million and $1.2 million, respectively, and will be reclassified to net interest expense as interest payments are made on our fixed-rate debt. Within the next 12 months, a loss of approximately $.8 million in accumulated other comprehensive loss is expected to be amortized to net interest expense related to settled interest rate contracts.
Summary of cash flow interest rate contract hedging activity is as follows (in thousands):
|
| | | | | | | | | | | | | | | | |
Derivatives Hedging Relationships | | Amount of (Gain) Loss Recognized in Other Comprehensive Income on Derivative (Effective Portion) | | Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income | | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income (Effective Portion) | | Location of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing) | | Amount of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing) |
| Year Ended December 31, 2014 | | $ | (131 | ) | | Interest expense, net | | $ | (1,682 | ) | | Interest expense, net | | $ | (370 | ) |
| Year Ended December 31, 2013 | | $ | (6,423 | ) | | Interest expense, net | | $ | (2,537 | ) | | Interest expense, net | | $ | 238 |
|
| Year Ended December 31, 2012 | | $ | 123 |
| | Interest expense, net | | $ | (2,650 | ) | | Interest expense, net | | $ | — |
|
Fair Value Hedges:
As of December 31, 2014, we had two interest rate contracts, maturing through October 2017, with an aggregate notional amount of $65.3 million that were designated as fair value hedges and convert fixed interest payments at rates of 7.5% to variable interest payments ranging from 4.2% to 4.3%. As of December 31, 2013, we had fourinterest rate contracts, maturing through October 2017, with an aggregate notional amount of $116.7 million that were designated as fair value hedges and convert fixed interest payments at rates from 4.2% to 7.5% to variable interest payments ranging from .2% to 4.3%. We have determined that our fair value hedges are highly effective in limiting our risk of changes in the fair value of fixed-rate notes attributable to changes in interest rates.
A summary of the impact on net income for our interest rate contracts is as follows (in thousands):
|
| | | | | | | | | | | | | | | |
| | Gain (Loss) on Contracts | | Gain (Loss) on Borrowings | | Net Settlements and Accruals on Contracts (1) | | Amount of Gain (Loss) Recognized in Income (2) |
| Year Ended December 31, 2014 | | | | | | | |
| Interest expense, net | $ | (1,386 | ) | | $ | 1,386 |
| | $ | 2,179 |
| | $ | 2,179 |
|
| Year Ended December 31, 2013 | | | | | | | |
| Interest expense, net | (4,643 | ) | | 4,643 |
| | 4,082 |
| | 4,082 |
|
| Year Ended December 31, 2012 | | | | | | | |
| Interest expense, net | (860 | ) | | 860 |
| | 6,749 |
| | 6,749 |
|
___________________
| |
| (1) | Amounts in this caption include gain (loss) recognized in income on derivatives and net cash settlements. |
| |
| (2) | No ineffectiveness was recognized during the respective periods. |
Note 9. Preferred Shares of Beneficial Interest
We issued $150 million and $200 million of depositary shares on June 6, 2008 and January 30, 2007, respectively. Each depositary share represents one-hundredth of a Series F Cumulative Redeemable Preferred Share. The depositary shares are redeemable at our option, in whole or in part, for cash at a redemption price of $25 per depositary share, plus any accrued and unpaid dividends thereon. The depositary shares are not convertible or exchangeable for any of our other property or securities. The Series F Preferred Shares pay a 6.5% annual dividend and have a liquidation value of $2,500 per share. The Series F Preferred Shares issued in June 2008 were issued at a discount, resulting in an effective rate of 8.25%.
We exercised our option to redeem a portion of the Series F depositary shares totaling $200 million on June 5, 2013. Upon the redemption of these shares, a portion of the related original issuance costs totaling $15.7 million was reported as a deduction in arriving at net income attributable to common shareholders. The outstanding $150 million Series F Preferred Shares pay a 6.5% annual dividend and have a liquidation value of $2,500 per share. Of these outstanding shares, $64.3 million were issued at a discount and have an effective rate of 8.25%.
In 2013 and 2012, we redeemed all of our outstanding Series D and Series E Cumulative Redeemable Preferred Shares, respectively.
The following table discloses the cumulative redeemable preferred dividends declared per share:
|
| | | | | | | | | | | | |
| | | Year Ended December 31, |
| | | 2014 | | 2013 | | 2012 |
| Series of Preferred Shares: | | | | | | |
| Series D | | $ | — |
| | $ | 13.08 |
| | $ | 50.63 |
|
| Series E | | — |
| | — |
| | 162.16 |
|
| Series F | | 162.50 |
| | 160.24 |
| | 162.50 |
|
As part of our evaluation of our capital plan, we may consider redeeming the remaining Series F Preferred Shares.
Note 10. Common Shares of Beneficial Interest
Common dividends declared per share were $1.55, $1.22 and $1.16 for the year ended December 31, 2014, 2013 and 2012, respectively. The regular dividend rate per share for our common shares for each quarter of 2014 and 2013 was $.325 and $.305, respectively. Also in December 2014, we paid a special dividend for our common shares in the amount of $.25 per share, which was due to the significant gains on dispositions of property. Subsequent to December 31, 2014, our Board of Trust Managers approved an increase to our 2015 first quarter dividend to $.345 per share.
Note 11. Noncontrolling Interests
The following table summarizes the effect of changes in our ownership interest in subsidiaries on the equity attributable to us as follows (in thousands):
|
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Net income adjusted for noncontrolling interests | $ | 288,008 |
| | $ | 220,262 |
| | $ | 146,640 |
|
| Transfers from the noncontrolling interests: | | | | | |
Net increase (decrease) in equity for the acquisition of noncontrolling interests | 11,015 |
| | (16,177 | ) | | 394 |
|
Change from net income adjusted for noncontrolling interests and transfers from the noncontrolling interests | $ | 299,023 |
| | $ | 204,085 |
| | $ | 147,034 |
|
Note 12. Leasing Operations
The terms of our leases range from less than one year for smaller tenant spaces to over 25 years for larger tenant spaces. In addition to minimum lease payments, most of the leases provide for contingent rentals (payments for real estate taxes, maintenance and insurance by lessees and an amount based on a percentage of the tenants’ sales).
Future minimum rental income from non-cancelable tenant leases, excluding leases associated with property held for sale and estimated contingent rentals, at December 31, 2014 is as follows (in thousands):
|
| | | |
| 2015 | $ | 360,860 |
|
| 2016 | 311,436 |
|
| 2017 | 254,274 |
|
| 2018 | 202,296 |
|
| 2019 | 153,214 |
|
| Thereafter | 553,061 |
|
| Total | $ | 1,835,141 |
|
Contingent rentals for the year ended December 31, are as follows (in thousands):
|
| | | |
| 2014 | $ | 109,714 |
|
| 2013 | 112,551 |
|
| 2012 | 112,431 |
|
Note 13. Impairment
The following impairment charges were recorded on the following assets based on the difference between the carrying amount of the assets and the estimated fair value (see Note 24 for additional fair value information) (in thousands):
|
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Continuing operations: | | | | | |
Land held for development and undeveloped land (1) | $ | — |
| | $ | 2,358 |
| | $ | — |
|
Property marketed for sale or sold (2) | 808 |
| | 56 |
| | 2,977 |
|
Investments in real estate joint ventures and partnerships (3) | — |
| | — |
| | 6,608 |
|
| Other | 216 |
| | 165 |
| | — |
|
| Total reported in continuing operations | 1,024 |
| | 2,579 |
| | 9,585 |
|
| Discontinued operations: | | | | | |
Property held for sale or sold (4) | — |
| | 236 |
| | 5,851 |
|
| Total impairment charges | 1,024 |
| | 2,815 |
| | 15,436 |
|
| Other financial statement captions impacted by impairment: | | | | | |
| Equity in earnings (losses) of real estate joint ventures and partnerships, net | 305 |
| | 395 |
| | 19,946 |
|
| Net impact of impairment charges | $ | 1,329 |
| | $ | 3,210 |
| | $ | 35,382 |
|
___________________
| |
| (1) | Impairment was prompted by changes in management's plans for these properties, recent comparable market transactions and/or a change in market conditions. |
| |
| (2) | The charge for 2014 was based primarily on third party offers. Charges for 2013 and 2012 resulted from changes in management’s plans for these properties, primarily the marketing of these properties for sale. Also, included in this caption are impairments associated with dispositions that did not qualify to be reported in discontinued operations. |
| |
| (3) | Amounts reported in 2012 were based on third party offers to buy our interests in industrial real estate joint ventures. |
| |
| (4) | Amounts reported were based on third party offers. |
Note 14. Income Tax Considerations
We qualify as a REIT under the provisions of the Internal Revenue Code, and therefore, no tax is imposed on our taxable income distributed to shareholders. To maintain our REIT status, we must distribute at least 90% of our ordinary taxable income to our shareholders and meet certain income source and investment restriction requirements. Our shareholders must report their share of income distributed in the form of dividends.
Taxable income differs from net income for financial reporting purposes principally because of differences in the timing of recognition of depreciation, rental revenue, interest expense, compensation expense, impairment losses and gain from sales of property. As a result of these differences, the book value of our net fixed assets is in excess of (less than) the tax basis by $32.0 million and $(88.0) million at December 31, 2014 and 2013, respectively.
The following table reconciles net income adjusted for noncontrolling interests to REIT taxable income (in thousands):
|
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Net income adjusted for noncontrolling interests | $ | 288,008 |
| | $ | 220,262 |
| | $ | 146,640 |
|
| Net (income) loss of taxable REIT subsidiary included above | (4,092 | ) | | (4,684 | ) | | 11,457 |
|
| Net income from REIT operations | 283,916 |
| | 215,578 |
| | 158,097 |
|
Book depreciation and amortization including discontinued operations | 150,616 |
| | 157,665 |
| | 148,413 |
|
| Tax depreciation and amortization | (90,328 | ) | | (90,047 | ) | | (92,797 | ) |
| Book/tax difference on gains/losses from capital transactions | (87,387 | ) | | (33,969 | ) | | (55,242 | ) |
| Deferred/prepaid/above and below-market rents, net | (3,617 | ) | | (6,429 | ) | | (4,264 | ) |
Impairment loss from REIT operations including discontinued operations | 942 |
| | 474 |
| | 11,396 |
|
| Other book/tax differences, net | (6,399 | ) | | (9,695 | ) | | 1,430 |
|
| REIT taxable income | 247,743 |
| | 233,577 |
| | 167,033 |
|
Dividends paid deduction (1) | (247,743 | ) | | (233,577 | ) | | (173,202 | ) |
| Dividends paid in excess of taxable income | $ | — |
| | $ | — |
| | $ | (6,169 | ) |
___________________
| |
| (1) | For 2014 and 2013, the dividends paid deduction includes designated dividends of $114.0 million and $67.7 million from 2015 and 2014, respectively. |
For federal income tax purposes, the cash dividends distributed to common shareholders are characterized as follows:
|
| | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Ordinary income | 54.0 | % | | 50.5 | % | | 92.8 | % |
| Capital gain distributions | 46.0 | % | | 49.5 | % | | 7.2 | % |
| Total | 100.0 | % | | 100.0 | % | | 100.0 | % |
Our deferred tax assets and liabilities, including a valuation allowance, consisted of the following (in thousands):
|
| | | | | | | |
| | December 31, |
| | 2014 | | 2013 |
| Deferred tax assets: | | | |
Impairment loss (1) | $ | 13,900 |
| | $ | 17,692 |
|
| Allowance on other assets | 91 |
| | 1,168 |
|
| Interest expense | 12,701 |
| | 12,842 |
|
Net operating loss carryforwards (2) | 11,024 |
| | 8,814 |
|
| Book-tax basis differential | 1,693 |
| | 886 |
|
| Other | 412 |
| | 241 |
|
| Total deferred tax assets | 39,821 |
| | 41,643 |
|
Valuation allowance (3) | (27,539 | ) | | (30,541 | ) |
| Total deferred tax assets, net of allowance | $ | 12,282 |
| | $ | 11,102 |
|
| Deferred tax liabilities: | | | |
| Straight-line rentals | $ | 48 |
| | $ | 696 |
|
| Book-tax basis differential | 7,402 |
| | 8,252 |
|
| Other | 387 |
| | 167 |
|
| Total deferred tax liabilities | $ | 7,837 |
| | $ | 9,115 |
|
___________________
| |
| (1) | Impairment losses will not be recognized until the related properties are sold and realization is dependent upon generating sufficient taxable income in the year the property is sold. |
| |
| (2) | We have net operating loss carryforwards of $31.5 million that expire between the years of 2029 and 2034. |
| |
| (3) | Management believes it is more likely than not that a portion of the deferred tax assets, which primarily consists of impairment losses, interest expense and net operating losses, will not be realized and established a valuation allowance. However, the amount of the deferred tax asset considered realizable could be reduced if estimates of future taxable income are reduced. |
We are subject to federal, state and local income taxes and have recorded an income tax (benefit) provision as follows (in thousands):
|
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Net income (loss) before taxes of taxable REIT subsidiary | $ | 1,446 |
| | $ | 10,688 |
| | $ | (12,894 | ) |
| Federal provision (benefit) at statutory rate of 35% | $ | 506 |
| | $ | 3,741 |
| | $ | (4,513 | ) |
| Valuation allowance (decrease) increase | (3,003 | ) | | 2,165 |
| | 3,781 |
|
| Other | (149 | ) | | 98 |
| | (705 | ) |
Federal income tax (benefit) provision of taxable REIT subsidiary (1) | (2,646 | ) | | 6,004 |
| | (1,437 | ) |
Texas franchise tax (2) | 1,403 |
| | 1,370 |
| | 1,784 |
|
| Total | $ | (1,243 | ) | | $ | 7,374 |
| | $ | 347 |
|
___________________
| |
| (1) | All periods presented are open for examination by the IRS. |
| |
| (2) | For all periods presented, amounts include the effects that are reported in discontinued operations. See Note 15 for additional information. |
Also, a current tax obligation of $1.5 million and $1.6 million has been recorded at December 31, 2014 and 2013, respectively, in association with these taxes.
Note 15. Discontinued Operations
During 2014, we sold 12 centers, three in each of Georgia and Texas and two in each of Florida, Louisiana and North Carolina. These dispositions represent the centers that were classified as discontinued operations or held for sale prior to April 1, 2014, our adoption date for the new qualification criteria for discontinued operations (see Note 2 for further information). Since adoption, no other dispositions have qualified as discontinued operations under the new guidance.
During 2013, we sold 20 centers, nine in Texas, three in each of Florida and North Carolina, two in New Mexico and one in each of California, Nevada and Tennessee. As of December 31, 2013, we classified as held for sale eight centers that consisted of property and accumulated depreciation totaling $155.0 million and $32.4 million, respectively, with three located in Georgia, two in each of Florida and Texas and one in North Carolina.
Excluding property held for sale at December 31, 2013, our Condensed Consolidated Balance Sheet at December 31, 2013 included $68.6 million of property and $13.2 million of accumulated depreciation related to the four centers that were sold and classified as discontinued operations during 2014.
The operating results of these centers have been reclassified and reported as discontinued operations in the Consolidated Statements of Operations as follows (in thousands):
|
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Revenues, net | $ | 1,062 |
| | $ | 43,452 |
| | $ | 92,193 |
|
| Depreciation and amortization | (260 | ) | | (10,902 | ) | | (20,710 | ) |
| Operating expenses | (285 | ) | | (7,457 | ) | | (17,090 | ) |
| Real estate taxes, net | (136 | ) | | (4,766 | ) | | (11,643 | ) |
| Impairment loss | — |
| | (236 | ) | | (5,851 | ) |
| General and administrative | (2 | ) | | (24 | ) | | (2,214 | ) |
| Interest, net | (19 | ) | | (7,527 | ) | | (10,215 | ) |
| Interest and other income, net | — |
| | 2 |
| | 1 |
|
| Gain on acquisition | — |
| | — |
| | 1,869 |
|
| Provision for income taxes | (18 | ) | | (328 | ) | | (422 | ) |
| Operating income from discontinued operations | 342 |
| | 12,214 |
| | 25,918 |
|
| Gain on sale of property from discontinued operations | 44,582 |
| | 119,203 |
| | 68,619 |
|
| Income from discontinued operations | $ | 44,924 |
| | $ | 131,417 |
| | $ | 94,537 |
|
Note 16. Supplemental Cash Flow Information
Non-cash investing and financing activities are summarized as follows (in thousands):
|
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Accrued property construction costs | $ | 6,265 |
| | $ | 5,175 |
| | $ | 5,811 |
|
Increase (decrease) in equity for the acquisition of noncontrolling interests in consolidated real estate joint ventures | 11,015 |
| | (16,177 | ) | | 394 |
|
Decrease in notes receivable from real estate joint ventures and partnerships in association with our contribution in an unconsolidated real estate joint venture | (6,431 | ) | | — |
| | — |
|
| Reduction of debt service guaranty liability | (1,635 | ) | | (335 | ) | | — |
|
Property acquisitions and investments in unconsolidated real estate joint ventures: | | | | | |
| (Decrease) increase in property, net | — |
| | 43,122 |
| | 16,665 |
|
Decrease in notes receivable from real estate joint ventures and partnerships | — |
| | (8,750 | ) | | — |
|
Increase (decrease) in real estate joint ventures and partnerships - investments | — |
| | 1,746 |
| | (3,825 | ) |
| Increase in restricted deposits and mortgage escrows | — |
| | — |
| | 395 |
|
| Increase in debt, net | — |
| | 60,515 |
| | 40,644 |
|
| Increase in security deposits | — |
| | 187 |
| | 1,332 |
|
| Increase in noncontrolling interests | — |
| | 16,177 |
| | 968 |
|
| Sale of property and property interest: | | | | | |
| Decrease in property, net | (127,837 | ) | | — |
| | (2,855 | ) |
Decrease in real estate joint ventures and partnerships - investments | (17 | ) | | — |
| | (95 | ) |
| Decrease in restricted deposits and mortgage escrows | — |
| | — |
| | (204 | ) |
| Decrease in other, net | (34 | ) | | — |
| | — |
|
| Decrease in debt, net due to debt assumption | (11,069 | ) | | — |
| | (3,366 | ) |
| Decrease in security deposits | (459 | ) | | — |
| | (11 | ) |
| Decrease in noncontrolling interests | (155,278 | ) | | — |
| | (95 | ) |
| Consolidation of joint ventures (see Note 23): | | | | | |
| Increase in property, net | — |
| | 60,992 |
| | — |
|
Decrease in notes receivable from real estate joint ventures and partnerships | — |
| | (54,838 | ) | | — |
|
Decrease in real estate joint ventures and partnerships - investments | — |
| | (11,518 | ) | | — |
|
| Increase in security deposits | — |
| | 164 |
| | — |
|
Note 17. Earnings Per Share
Earnings per common share – basic is computed using net income attributable to common shareholders and the weighted average number of shares outstanding – basic. Earnings per common share – diluted includes the effect of potentially dilutive securities. Income from continuing operations attributable to common shareholders includes gain on sale of property in accordance with Securities and Exchange Commission guidelines. The components of earnings per common share – basic and diluted for the prior periods have been recast to conform with discontinued operations. Earnings per common share – basic and diluted components for the periods indicated are as follows (in thousands):
|
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Numerator: | | | | | |
| Continuing Operations: |
| |
|
|
|
| Income from continuing operations | $ | 116,365 |
| | $ | 132,977 |
| | $ | 56,880 |
|
| Gain on sale of property | 146,290 |
| | 762 |
| | 1,004 |
|
| Net income attributable to noncontrolling interests | (19,623 | ) | | (5,545 | ) | | (4,527 | ) |
| Dividends on preferred shares | (10,840 | ) | | (18,173 | ) | | (34,930 | ) |
| Redemption costs of preferred shares | — |
| | (17,944 | ) | | (2,500 | ) |
Income from continuing operations attributable to
common shareholders – basic | 232,192 |
| | 92,077 |
| | 15,927 |
|
| Income attributable to operating partnership units | 2,171 |
| | — |
| | — |
|
Income from continuing operations attributable to
common shareholders – diluted | $ | 234,363 |
| | $ | 92,077 |
| | $ | 15,927 |
|
| Discontinued Operations: | | | | | |
| Income from discontinued operations | $ | 44,924 |
| | $ | 131,417 |
| | $ | 94,537 |
|
| Net loss (income) attributable to noncontrolling interests | 52 |
| | (39,349 | ) | | (1,254 | ) |
Income from discontinued operations attributable to common shareholders – basic and diluted | $ | 44,976 |
| | $ | 92,068 |
| | $ | 93,283 |
|
| Net Income: | | | | | |
| Net income attributable to common shareholders – basic | $ | 277,168 |
| | $ | 184,145 |
| | $ | 109,210 |
|
| Net income attributable to common shareholders – diluted | $ | 279,339 |
| | $ | 184,145 |
| | $ | 109,210 |
|
| Denominator: | | | | | |
| Weighted average shares outstanding – basic | 121,542 |
| | 121,269 |
| | 120,696 |
|
| Effect of dilutive securities: | | | | | |
| Share options and awards | 1,331 |
| | 1,191 |
| | 1,009 |
|
| Operating partnership units | 1,497 |
| | — |
| | — |
|
| Weighted average shares outstanding – diluted | 124,370 |
| | 122,460 |
| | 121,705 |
|
Anti-dilutive securities of our common shares, which are excluded from the calculation of earnings per common share – diluted, are as follows (in thousands):
|
| | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
Share options (1) | 908 |
| | 1,929 |
| | 2,354 |
|
| Operating partnership units | — |
| | 1,554 |
| | 1,578 |
|
| Total anti-dilutive securities | 908 |
| | 3,483 |
| | 3,932 |
|
___________________
| |
| (1) | Exclusion results as exercise prices were greater than the average market price for each respective period. |
Note 18. Share Options and Awards
In April 2011, our Long-Term Incentive Plan for the issuance of options and share awards expired, and issued options of 2.3 million remain outstanding as of December 31, 2014.
In May 2010, our shareholders approved the adoption of the Amended and Restated 2010 Long-Term Incentive Plan, under which 3.0 million of our common shares were reserved for issuance, and options and share awards of 1.4 million are available for future grant at December 31, 2014. This plan expires in May 2020.
Compensation expense, net of forfeitures, associated with share options and restricted shares totaled $7.9 million in 2014, $8.8 million in 2013 and $9.7 million in 2012, of which $2.3 million in 2014, $2.4 million in 2013 and $2.0 million in 2012 was capitalized.
Options
The fair value of share options issued prior to 2012 was estimated on the date of grant using the Black-Scholes option pricing method based on the expected weighted average assumptions.
Following is a summary of the option activity for the three years ended December 31, 2014:
|
| | | | | | |
| | Shares Under Option | | Weighted Average Exercise Price |
| Outstanding, January 1, 2012 | 4,607,703 |
| | $ | 28.09 |
|
| Forfeited or expired | (40,390 | ) | | 27.12 |
|
| Exercised | (481,611 | ) | | 20.70 |
|
| Outstanding, December 31, 2012 | 4,085,702 |
| | 28.98 |
|
| Forfeited or expired | (79,108 | ) | | 32.61 |
|
| Exercised | (462,848 | ) | | 26.95 |
|
| Outstanding, December 31, 2013 | 3,543,746 |
| | 29.16 |
|
| Forfeited or expired | (307,413 | ) | | 39.73 |
|
| Exercised | (339,210 | ) | | 22.98 |
|
| Outstanding, December 31, 2014 | 2,897,123 |
| | $ | 28.76 |
|
The total intrinsic value of options exercised was $4.2 million in 2014, $3.2 million in 2013 and $3.0 million in 2012. As of December 31, 2014 and 2013, there was approximately $0.5 million and $1.1 million, respectively, of total unrecognized compensation cost related to unvested share options, which is expected to be amortized over a weighted average of 0.8 years and 1.1 years, respectively.
The following table summarizes information about share options outstanding and exercisable at December 31, 2014:
|
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Range of Exercise Prices | | Outstanding | | Exercisable |
| | Number | | Weighted Average Remaining Contractual Life | | Weighted Average Exercise Price | | Aggregate Intrinsic Value (000’s) | | Number | | Weighted Average Exercise Price | | Weighted Average Remaining Contractual Life | | Aggregate Intrinsic Value (000’s) |
| $11.85 - $17.78 | | 618,556 |
| | 4.2 years | | $ | 11.85 |
| | | | 618,556 |
| | $ | 11.85 |
| | 4.2 years | | |
| $17.79 - $26.69 | | 801,760 |
| | 5.8 years | | $ | 23.78 |
| | | | 584,698 |
| | $ | 23.64 |
| | 5.7 years | | |
| $26.70 - $40.05 | | 1,015,468 |
| | 2.2 years | | $ | 34.51 |
| | | | 1,015,468 |
| | $ | 34.51 |
| | 2.2 years | | |
| $40.06 - $49.62 | | 461,339 |
| | 1.9 years | | $ | 47.46 |
| | | | 461,339 |
| | $ | 47.46 |
| | 1.9 years | | |
| Total | | 2,897,123 |
| | 3.6 years | | $ | 28.76 |
| | $ | 17,846 |
| | 2,680,061 |
| | $ | 29.14 |
| | 3.4 years | | $ | 15,491 |
|
Restricted Shares
The fair value of the market-based share awards was estimated on the date of grant using a Monte Carlo valuation model based on the following assumptions:
|
| | | | | |
| | Year Ended December 31, 2014 |
| | Minimum | | Maximum |
| Dividend yield | 0.0 | % | | 4.1 | % |
| Expected volatility | 14.8 | % | | 25.3 | % |
| Expected life (in years) | N/A |
| | 3 |
|
| Risk-free interest rate | 0.1 | % | | 0.8 | % |
A summary of the status of unvested restricted shares for the year ended December 31, 2014 is as follows:
|
| | | | | | |
| | Unvested Restricted Share Awards | | Weighted Average Grant Date Fair Value |
| Outstanding, January 1, 2014 | 575,167 |
| | $ | 26.54 |
|
| Granted: | | | |
| Service-based awards | 112,329 |
| | 30.24 |
|
Market-based awards relative to FTSE NAREIT U.S. Shopping Center Index | 49,065 |
| | 33.88 |
|
| Market-based awards relative to three-year absolute TSR | 49,065 |
| | 27.63 |
|
| Trust manager awards | 29,043 |
| | 31.00 |
|
| Vested | (119,858 | ) | | 21.67 |
|
| Forfeited | (1,006 | ) | | 28.11 |
|
| Outstanding, December 31, 2014 | 693,805 |
| | $ | 28.76 |
|
As of December 31, 2014 and 2013, there was approximately $2.7 million and $3.9 million, respectively, of total unrecognized compensation cost related to unvested restricted shares, which is expected to be amortized over a weighted average of 0.9 years and 1.4 years, respectively.
Note 19. Employee Benefit Plans
Defined Benefit Plans:
The following tables summarize changes in the benefit obligation, the plan assets and the funded status of our pension plans as well as the components of net periodic benefit costs, including key assumptions (in thousands). The measurement dates for plan assets and obligations were December 31, 2014 and 2013.
|
| | | | | | | |
| | December 31, |
| | 2014 | | 2013 |
| Change in Projected Benefit Obligation: | | | |
| Benefit obligation at beginning of year | $ | 38,072 |
| | $ | 42,530 |
|
| Service cost | 1,008 |
| | 1,281 |
|
| Interest cost | 1,800 |
| | 1,544 |
|
Actuarial loss (gain) (1) | 11,020 |
| | (5,807 | ) |
| Benefit payments | (1,682 | ) | | (1,476 | ) |
| Benefit obligation at end of year | $ | 50,218 |
| | $ | 38,072 |
|
| Change in Plan Assets: | | | |
| Fair value of plan assets at beginning of year | $ | 39,327 |
| | $ | 32,161 |
|
| Actual return on plan assets | 2,861 |
| | 6,842 |
|
| Employer contributions | 2,100 |
| | 1,800 |
|
| Benefit payments | (1,682 | ) | | (1,476 | ) |
| Fair value of plan assets at end of year | $ | 42,606 |
| | $ | 39,327 |
|
| (Unfunded) funded status at end of year (included in accounts payable and accrued expenses in 2014 and other assets in 2013) | $ | (7,612 | ) | | $ | 1,255 |
|
| Accumulated benefit obligation | $ | 50,104 |
| | $ | 37,885 |
|
| Net loss recognized in accumulated other comprehensive loss | $ | 16,508 |
| | $ | 5,775 |
|
| |
| (1) | The year over year change in actuarial loss is due primarily to the application of a new mortality rate table, a decrease in the discount rate and demographic changes. |
The following is the required information for other changes in plan assets and benefit obligations recognized in other comprehensive loss (income) (in thousands):
|
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Net loss (gain) | $ | 11,118 |
| | $ | (10,200 | ) | | $ | 979 |
|
Amortization of net loss (1) | (385 | ) | | (1,279 | ) | | (1,569 | ) |
| Amortization of prior service cost | — |
| | — |
| | 117 |
|
| Total recognized in other comprehensive loss (income) | $ | 10,733 |
| | $ | (11,479 | ) | | $ | (473 | ) |
Total recognized in net periodic benefit costs and other comprehensive loss (income) | $ | 10,967 |
| | $ | (9,824 | ) | | $ | 1,622 |
|
___________________
| |
| (1) | The estimated net loss that will be amortized from accumulated other comprehensive loss into net periodic benefit cost over the next fiscal year is $1.3 million. |
The following is the required information for plans with an accumulated benefit obligation in excess of plan assets (in thousands):
|
| | | | | |
| | December 31, |
| | 2014 | | 2013 |
| Projected benefit obligation | $ | 50,218 |
| | N/A |
| Accumulated benefit obligation | 50,104 |
| | N/A |
| Fair value of plan assets | 42,606 |
| | N/A |
The components of net periodic benefit cost for the plans are as follows (in thousands):
|
| | | | | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Service cost | $ | 1,008 |
| | $ | 1,281 |
| | $ | 1,314 |
|
| Interest cost | 1,800 |
| | 1,544 |
| | 1,578 |
|
| Expected return on plan assets | (2,959 | ) | | (2,449 | ) | | (2,249 | ) |
| Prior service cost | — |
| | — |
| | (117 | ) |
| Recognized loss | 385 |
| | 1,279 |
| | 1,569 |
|
| Total | $ | 234 |
| | $ | 1,655 |
| | $ | 2,095 |
|
The assumptions used to develop periodic expense for the plans are shown below:
|
| | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Discount rate | 4.70 | % | | 3.87 | % | | 4.19 | % |
| Salary scale increases | 3.50 | % | | 3.50 | % | | 3.50 | % |
| Long-term rate of return on assets | 7.50 | % | | 7.50 | % | | 8.00 | % |
The selection of the discount rate is made annually after comparison to yields based on high quality fixed-income investments. The salary scale is the composite rate which reflects anticipated inflation, merit increases, and promotions for the group of covered participants. The long-term rate of return is a composite rate for the trust. It is derived as the sum of the percentages invested in each principal asset class included in the portfolio multiplied by their respective expected rates of return. We considered the historical returns and the future expectations for returns for each asset class, as well as the target asset allocation of the pension portfolio. This analysis resulted in the selection of 7.50% as the long-term rate of return assumption for 2014.
The assumptions used to develop the actuarial present value of the benefit obligations for the plans are shown below:
|
| | | | | | | | |
| | Year Ended December 31, |
| | 2014 | | 2013 | | 2012 |
| Discount rate | 3.83 | % | | 4.70 | % | | 3.87 | % |
| Salary scale increases | 3.50 | % | | 3.50 | % | | 3.50 | % |
The expected contribution to be paid for the Retirement Plan by us during 2015 is approximately $2.0 million. The expected benefit payments for the next 10 years for the Retirement Plan is as follows (in thousands):
|
| | | |
| 2015 | $ | 2,250 |
|
| 2016 | 2,193 |
|
| 2017 | 2,140 |
|
| 2018 | 1,998 |
|
| 2019 | 2,404 |
|
| 2020-2024 | 12,513 |
|
The participant data used in determining the liabilities and costs for the Retirement Plan was collected as of January 1, 2014, and no significant changes have occurred through December 31, 2014.
At December 31, 2014, our investment asset allocation compared to our benchmarking allocation model for our plan assets was as follows:
|
| | | | | |
| | Portfolio | | Benchmark |
| Cash and Short-Term Investments | 6 | % | | 6 | % |
| U.S. Stocks | 60 | % | | 61 | % |
| International Stocks | 13 | % | | 11 | % |
| U.S. Bonds | 18 | % | | 19 | % |
| International Bonds | 3 | % | | 3 | % |
| Total | 100 | % | | 100 | % |
The fair value of plan assets was determined based on publicly quoted market prices for identical assets, which are classified as Level 1 observable inputs. The allocation of the fair value of plan assets was as follows:
|
| | | | | |
| | December 31, |
| | 2014 | | 2013 |
| Cash and Short-Term Investments | 18 | % | | 3 | % |
| Large Company Funds | 35 | % | | 31 | % |
| Mid Company Funds | 6 | % | | 8 | % |
| Small Company Funds | 6 | % | | 8 | % |
| International Funds | 10 | % | | 11 | % |
| Fixed Income Funds | 17 | % | | 21 | % |
| Growth Funds | 8 | % | | 18 | % |
| Total | 100 | % | | 100 | % |
Concentrations of risk within our equity portfolio are investments classified within the following sectors: technology, financial services, consumer cyclical goods, healthcare and industrial, which represents approximately 17%, 16%, 15%, 15% and 12% of total equity investments, respectively.
Defined Contribution Plans:
Compensation expense related to our defined contribution plans was $3.2 million in 2014, $3.1 million in 2013 and $3.3 million in 2012.
Note 20. Related Parties
Through our management activities and transactions with our real estate joint ventures and partnerships, we had net accounts receivable of $1.5 million and $1.4 million outstanding as of December 31, 2014 and 2013, respectively. We also had accounts payable and accrued expenses of $6.0 million and $5.6 million outstanding as of December 31, 2014 and 2013, respectively. For the year ended December 31, 2014, 2013 and 2012, we recorded joint venture fee income of $4.6 million, $5.0 million and $6.1 million, respectively.
In 2014, we completed the dissolution of our consolidated real estate joint venture with Hines Retail REIT (“Hines”), in which we owned a 30% interest. At December 31, 2013, this joint venture held a portfolio of 13 properties located in Texas, Tennessee, Georgia, Florida and North Carolina with $172.9 million in total assets and $11.1 million of debt, net, which was assumed by Hines. This transaction was completed through the distribution of five properties to us, resulting in an increase to our equity of $11.0 million, and eight properties to Hines. The eight properties distributed to Hines were classified as held for sale at December 31, 2013, and we realized a $23.3 million gain in discontinued operations associated with this transaction.
In 2013, we sold our 10% interest in two unconsolidated tenancy-in-common arrangements to our partner for approximately $8.9 million. Also, we received cash, real property and our partner’s interest in two consolidated joint ventures in exchange for our interest in two unconsolidated joint ventures and the payment of a note receivable (see Note 21 for additional information under Litigation). Furthermore, we acquired our partner’s 50% unconsolidated joint venture interest in a California property.
Note 21. Commitments and Contingencies
Leases
We are engaged in the operation of shopping centers, which are either owned or, with respect to certain shopping centers, operated under long-term ground leases. These ground leases expire at various dates through 2069, with renewal options. Space in our shopping centers is leased to tenants pursuant to agreements that provide for terms ranging generally from one year to 25 years and, in some cases, for annual rentals subject to upward adjustments based on operating expense levels, sales volume, or contractual increases as defined in the lease agreements.
Scheduled minimum rental payments under the terms of all non-cancelable operating leases in which we are the lessee, principally for shopping center ground leases, for the subsequent five years and thereafter ending December 31, are as follows (in thousands):
|
| | | |
| 2015 | $ | 2,973 |
|
| 2016 | 2,851 |
|
| 2017 | 2,672 |
|
| 2018 | 2,636 |
|
| 2019 | 2,530 |
|
| Thereafter | 117,642 |
|
| Total | $ | 131,304 |
|
Rental expense for operating leases was, in millions: $5.3 in 2014; $5.6 in 2013 and $5.7 in 2012.
The scheduled future minimum revenues under subleases, applicable to the ground lease rentals, under the terms of all non-cancelable tenant leases, assuming no new or renegotiated leases or option extensions for the subsequent five years and thereafter ending December 31, are as follows (in thousands):
|
| | | |
| 2015 | $ | 27,605 |
|
| 2016 | 25,537 |
|
| 2017 | 22,646 |
|
| 2018 | 19,732 |
|
| 2019 | 14,052 |
|
| Thereafter | 58,085 |
|
| Total | $ | 167,657 |
|
Property under capital leases that is included in buildings and improvements consisted of two centers totaling $16.8 million at December 31, 2014 and 2013. Amortization of property under capital leases is included in depreciation and amortization expense, and the balance of accumulated depreciation associated with these capital leases at December 31, 2014 and 2013 was $13.0 million and $12.2 million, respectively. Future minimum lease payments under these capital leases total $37.8 million of which $16.8 million represents interest. Accordingly, the present value of the net minimum lease payments was $21.0 million at December 31, 2014.
The annual future minimum lease payments under capital leases as of December 31, 2014 are as follows (in thousands):
|
| | | |
| 2015 | $ | 1,834 |
|
| 2016 | 1,843 |
|
| 2017 | 1,852 |
|
| 2018 | 1,862 |
|
| 2019 | 1,871 |
|
| Thereafter | 28,578 |
|
| Total | $ | 37,840 |
|
Commitments and Contingencies
As of December 31, 2014 and 2013, we participate in three real estate ventures structured as DownREIT partnerships that have properties in Arkansas, California, North Carolina and Texas. As a general partner, we have operating and financial control over these ventures and consolidate them in our consolidated financial statements. These ventures allow the outside limited partners to put their interest in the partnership to us in exchange for our common shares or an equivalent amount in cash. We may acquire any limited partnership interests that are put to the partnership, and we have the option to redeem the interest in cash or a fixed number of our common shares, at our discretion. We also participate in a real estate venture that has a property in Texas that allows its outside partner to put operating partnership units to us. We have the option to redeem these units in cash or a fixed number of our common shares, at our discretion. No common shares were issued in exchange for any of these interests during the year ended December 31, 2014 and 2013. The aggregate redemption value of these interests was approximately $52 million and $41 million as of December 31, 2014 and December 31, 2013, respectively.
As of December 31, 2014, we have entered into commitments aggregating $64.3 million comprised principally of construction contracts which are generally due in 12 to 36 months.
As of December 31, 2014, we have executed an agreement to purchase the retail portion of a mixed-use project for approximately $23.8 million at delivery by the developer, which is estimated to occur in 2016. Including this payment, our expected total investment in the retail portion of the project is approximately $29.1 million.
We issue letters of intent signifying a willingness to negotiate for acquisitions, dispositions or joint ventures, as well as other types of potential transactions, during the ordinary course of our business. Such letters of intent and other arrangements are non-binding to all parties unless and until a definitive contract is entered into by the parties. Even if definitive contracts relating to the acquisition or disposition of property are entered into, these contracts generally provide the purchaser a time period to evaluate the property and conduct due diligence. The purchaser, during this time, will have the ability to terminate a contract without penalty or forfeiture of any deposit or earnest money. No assurance can be provided that any definitive contracts will be entered into with respect to any matter covered by letters of intent, or that we will consummate any transaction contemplated by a definitive contract. Additionally, due diligence periods for property transactions are frequently extended as needed. An acquisition or disposition of property becomes probable at the time the due diligence period expires and the definitive contract has not been terminated. Our risk is then generally extended only to any earnest money deposits associated with property acquisition contracts, and our obligation to sell under a property sales contract.
We are subject to numerous federal, state and local environmental laws, ordinances and regulations in the areas where we own or operate properties. We are not aware of any contamination which may have been caused by us or any of our tenants that would have a material effect on our consolidated financial statements.
As part of our risk management activities, we have applied and been accepted into state sponsored environmental programs which will limit our expenses if contaminants need to be remediated. We also have an environmental insurance policy that covers us against third party liabilities and remediation costs.
While we believe that we do not have any material exposure to environmental remediation costs, we cannot give absolute assurance that changes in the law or new discoveries of contamination will not result in additional liabilities to us.
Litigation
During 2013, we settled a lawsuit we filed in 2011 against our joint venture partner in connection with a development project in Sheridan, Colorado for an alleged failure of our joint venture partner to repay to us an intercompany note payable. Pursuant to the settlement agreement, our $16.1 million note receivable was paid in exchange for cash and real property totaling $19.1 million, receipt of our partner’s interest in two consolidated joint ventures resulting in an increase of approximately $16.2 million in noncontrolling interests and distribution of our interest in two unconsolidated joint ventures with total assets of $23.2 million.
We are also involved in various matters of litigation arising in the normal course of business. While we are unable to predict with certainty the amounts involved, our management and counsel are of the opinion that, when such litigation is resolved, any additional liability, if any, will not have a material effect on our consolidated financial statements.
Note 22. Variable Interest Entities
Consolidated VIEs:
At December 31, 2014, one of our real estate joint ventures, whose activities primarily consisted of owning and operating 15 neighborhood/community shopping centers located in Texas, was determined to be VIE. During 2014, we completed the dissolution of a real estate joint venture that was previously determined to be a VIE. At December 31, 2013, two of our real estate joint ventures, whose activities primarily consisted of owning and operating 28 neighborhood/community shopping centers located in Florida, Georgia, North Carolina, Tennessee and Texas, were determined to be VIEs. Based on financing agreements that are guaranteed solely by us, we have determined that we are the primary beneficiary in each of the foregoing instances and have consolidated these joint ventures.
A summary of our consolidated VIEs is as follows (in thousands):
|
| | | | | | | |
| | December 31, |
| | 2014 | | 2013 |
Maximum Risk of Loss (1) | $ | 37,178 |
| | $ | 40,471 |
|
| Assets Held by VIEs | 63,984 |
| | 233,734 |
|
| Assets Held as Collateral for Debt | 61,850 |
| | 80,137 |
|
___________________
| |
| (1) | The maximum risk of loss has been determined to be limited to our debt exposure for each real estate joint venture. |
Restrictions on the use of these assets are significant because they serve as collateral for the VIEs’ debt, and we would generally be required to obtain our partners’ approval in accordance with the joint venture agreements for any major transactions. Transactions with these joint ventures on our consolidated financial statements have been limited to changes in noncontrolling interests and reductions in debt from our partners’ contributions. We and our partners are subject to the provisions of the joint venture agreements which include provisions for when additional contributions may be required including operating cash shortfalls and unplanned capital expenditures.
Unconsolidated VIEs:
At December 31, 2014 and December 31, 2013, one unconsolidated real estate joint venture was determinedto be a VIE through the issuance of a secured loan, since the lender had the ability to make decisions that could have a significant impact on the success of the entity. A summary of our unconsolidated VIE is as follows (in thousands):
|
| | | | | | | |
| | December 31, |
| | 2014 | | 2013 |
Investment in Real Estate Joint Ventures and Partnerships, net (1) | $ | 11,464 |
| | $ | 11,536 |
|
Maximum Risk of Loss (2) | 10,992 |
| | 11,542 |
|
___________________
| |
| (1) | The carrying amount of the investment represents our contributions to the real estate joint venture, net of any distributions made and our portion of the equity in earnings of the joint venture. |
| |
| (2) | The maximum risk of loss has been determined to be limited to our debt exposure for the real estate joint venture. |
We and our partners are subject to the provisions of the joint venture agreements that specify conditions, including operating shortfalls and unplanned capital expenditures, under which additional contributions may be required.
Note 23. Business Combinations
Except as identified below, our aggregate acquisitions for 2014 and 2013 were not materially significant for disclosure purposes.
Effective December 23, 2013, we acquired a partner’s 50% interest in an unconsolidated joint venture related to a property in California, which resulted in the consolidation of this property. Management has determined that this transaction qualified as a business combination to be accounted for under the acquisition method. Accordingly, the assets and liabilities of this transaction were recorded in our Consolidated Balance Sheet at its estimated fair value as of the effective date. Fair value of assets acquired, liabilities assumed and equity interests were estimated using market-based measurements, including cash flow and other valuation techniques. The fair value measurement is based on both significant inputs for similar assets and liabilities in comparable markets and significant inputs that are not observable in the markets in accordance with our fair value measurements accounting policy. Key assumptions include third-party broker valuation estimates; a discount rate of 7.75%; a terminal capitalization rate for similar properties; and factors that we believe market participants would consider in estimating fair value. The result of this transaction is included in our Consolidated Statements of Operations beginning December 23, 2013.
The following table summarizes the transaction related to the business combination, including the assets acquired and liabilities assumed as indicated (in thousands):
|
| | | | |
| | December 23, 2013 | |
| Fair value of our equity interest before business combination | $ | 90,935 |
| |
| Fair value of consideration transferred | $ | 3,342 |
| (1) |
| Amounts recognized for assets and liabilities assumed: | | |
| Assets: | | |
| Property | $ | 64,211 |
| |
| Unamortized debt and lease costs | 9,213 |
| |
| Accrued rent and accounts receivable | 2,868 |
| |
| Cash and cash equivalents | 754 |
| |
| Other, net | 15,840 |
| |
| Liabilities: | | |
| Accounts payable and accrued expenses | (166 | ) | |
| Other, net | (1,452 | ) | |
| Total net assets | $ | 91,268 |
| (2) |
| | | |
| Gain recognized on equity interest remeasured to fair value | $ | 20,234 |
| (3) |
___________________
| |
| (1) | Consideration included $2.8 million of cash and a future obligation of $.5 million. |
| |
| (2) | Excludes the effect of $54.8 million in intercompany debt that is eliminated upon consolidation. |
| |
| (3) | Amount is included in Gain on Sale and Acquisition of Real Estate Joint Venture and Partnership Interests in our Consolidated Statement of Operations. |
The following table summarizes the impact to revenues and net income attributable to common shareholders from our business combination as follows (in thousands):
|
| | | |
| | Year Ended December 31, 2013 |
| Increase in revenues | $ | 197 |
|
| Increase in net income attributable to common shareholders | — |
|
The following unaudited supplemental pro forma data is presented for the year ended December 31, 2013, as if the business combination occurring in 2013 was completed on January 1, 2011. The gain related to this business combination was adjusted to the assumed acquisition date. The unaudited supplemental pro forma data is not necessarily indicative of what the actual results of our operations would have been assuming the transaction had been completed as set forth above, nor do they purport to represent our results of operations for future periods. The following table summarizes the supplemental pro forma data, as follows (in thousands, except per share amounts):
|
| | | | | | | |
| | Pro Forma 2013(1) | | Pro Forma 2012(1) |
| Revenues | $ | 498,331 |
| | $ | 468,656 |
|
| Net income | 244,918 |
| | 152,016 |
|
| Net income attributable to common shareholders | 163,907 |
| | 108,805 |
|
| Earnings per share – basic | 1.35 |
| | 0.90 |
|
| Earnings per share – diluted | 1.34 |
| | 0.89 |
|
___________________
| |
| (1) | There are no non-recurring pro forma adjustments included within or excluded from the amounts in the preceding table. |
Note 24. Fair Value Measurements
Recurring Fair Value Measurements:
Assets and liabilities measured at fair value on a recurring basis as of December 31, 20112014 and 2010,2013, aggregated by the level in the fair value hierarchy in which those measurements fall, are as follows (in thousands): | | | December 31, 2011 | | | | December 31, 2011 | | | | December 31, 2011 | | | | December 31, 2011 | |
| | | Quoted Prices in
Active Markets for
Identical Assets
and Liabilities
(Level 1) | | | Significant Other
Observable Inputs
(Level 2) | | | Significant
Unobservable
Inputs
(Level 3) | | | Fair Value at
December 31, 2011 | |
Assets: | | | | | | | | | | | | | | | | |
Investments in grantor trusts | | $ | 14,693 | | | | | | | | | | | $ | 14,693 | |
Derivative instruments: | | | | | | | | | | | | | | | | |
Interest rate contracts | | | | | | $ | 10,816 | | | | | | | | 10,816 | |
| | | | | | | | | | | | | | | | |
Total | | $ | 14,693 | | | $ | 10,816 | | | $ | - | | | $ | 25,509 | |
| | | | | | | | | | | | | | | | |
Liabilities: | | | | | | | | | | | | | | | | |
Derivative instruments: | | | | | | | | | | | | | | | | |
Interest rate contracts | | | | | | $ | 674 | | | | | | | $ | 674 | |
Deferred compensation plan obligations | | $ | 14,693 | | | | | | | | | | | | 14,693 | |
| | | | | | | | | | | | | | | | |
Total | | $ | 14,693 �� | | | $ | 674 | | | $ | - | | | $ | 15,367 | |
| | | | | | | | | | | | | | | | |
| | | December 31, 2011 | | | | December 31, 2011 | | | | December 31, 2011 | | | | December 31, 2011 | |
| | | Quoted Prices in
Active Markets for
Identical Assets
and Liabilities
(Level 1) | | | Significant Other
Observable Inputs
(Level 2) | | | Significant
Unobservable
Inputs
(Level 3) | | | Fair Value at
December 31, 2010 | |
Assets: | | | | | | | | | | | | | | | | |
Investments in grantor trusts | | $ | 15,055 | | | | | | | | | | | $ | 15,055 | |
Tax increment revenue bonds | | | | | | $ | 51,255 | | | $ | 10,700 | | | | 61,955 | |
Derivative instruments: | | | | | | | | | | | | | | | | |
Interest rate contracts | | | | | | | 7,192 | | | | | | | | 7,192 | |
| | | | | | | | | | | | | | | | |
Total | | $ | 15,055 | | | $ | 58,447 | | | $ | 10,700 | | | $ | 84,202 | |
| | | | | | | | | | | | | | | | |
Liabilities: | | | | | | | | | | | | | | | | |
Derivative instruments: | | | | | | | | | | | | | | | | |
Interest rate contracts | | | | | | $ | 108 | | | | | | | $ | 108 | |
Deferred compensation plan obligations | | $ | 15,055 | | | | | | | | | | | | 15,055 | |
| | | | | | | | | | | | | | | | |
Total | | $ | 15,055 | | | $ | 108 | | | $ | - | | | $ | 15,163 | |
| | | | | | | | | | | | | | | | |
A reconciliation
|
| | | | | | | | | | | | | | | | |
| | | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | | Significant Other Observable Inputs (Level 2) | | Significant Unobservable Inputs (Level 3) | | Fair Value at December 31, 2014 |
| |
| | Assets: | | | | | | | |
| | Investments, mutual funds held in a grantor trust | $ | 19,864 |
| | | | | | $ | 19,864 |
|
| | Investments, mutual funds | 7,446 |
| | | | | | 7,446 |
|
| | Derivative instruments: | | | | | | | |
| | Interest rate contracts | | | $ | 3,891 |
| | | | 3,891 |
|
| | Total | $ | 27,310 |
| | $ | 3,891 |
| | $ | — |
| | $ | 31,201 |
|
| | Liabilities: | | | | | | | |
| | Derivative instruments: | | | | | | | |
| | Interest rate contracts | | | $ | 109 |
| | | | $ | 109 |
|
| | Deferred compensation plan obligations | $ | 19,864 |
| | | | | | 19,864 |
|
| | Total | $ | 19,864 |
| | $ | 109 |
| | $ | — |
| | $ | 19,973 |
|
Table of the outstanding balance of the subordinate tax increment revenue bonds using significant unobservable inputs (Level 3) is as follows (in thousands): | | | | |
| | Fair Value Measurements Using
Significant Unobservable Inputs
(Level 3) | |
Outstanding, January 1, 2010
| | $ | - | |
Additions (1)
| | | 22,417 | |
Loss included in earnings (2)
| | | (11,717) | |
| | | | |
Outstanding, December 31, 2010
| | | 10,700 | |
Settlement of recalled bonds (3)
| | | (10,700) | |
| | | | |
Outstanding, December 31, 2011
| | $ | - | |
| | | | |
| (1) | Additions represent an investment including accrued interest in subordinate tax increment revenue bonds that was classified as available for sale on December 31, 2010.
|
| (2) | Represents the change in net unrealized losses recognized in impairment loss in the Consolidated Statement of Operations and Comprehensive Income for the year ended December 31, 2010.
|
| (3) | Settlement of recalled bonds represents the recall of previously issued subordinated tax increment revenue bonds that were available for sale and were replaced with held to maturity subordinated tax increment revenue bonds associated with the exchange transaction in April 2011.
|
Contents
|
| | | | | | | | | | | | | | | | |
| | | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | | Significant Other Observable Inputs (Level 2) | | Significant Unobservable Inputs (Level 3) | | Fair Value at December 31, 2013 |
| |
| | Assets: | | | | | | | |
| | Investments, mutual funds held in a grantor trust | $ | 18,583 |
| | | | | | $ | 18,583 |
|
| | Investments, mutual funds and time deposit | 8,408 |
| | 50,034 |
| | | | 58,442 |
|
| | Derivative instruments: | | | | | | | |
| | Interest rate contracts | | | 5,282 |
| | | | 5,282 |
|
| | Total | $ | 26,991 |
| | $ | 55,316 |
| | $ | — |
| | $ | 82,307 |
|
| | Liabilities: | | | | | | | |
| | Derivative instruments: | | | | | | | |
| | Interest rate contracts | | | $ | 476 |
| | | | $ | 476 |
|
| | Deferred compensation plan obligations | $ | 18,583 |
| | | | | | 18,583 |
|
| | Total | $ | 18,583 |
| | $ | 476 |
| | $ | — |
| | $ | 19,059 |
|
Nonrecurring Fair Value Measurements:
Property
and Property Held for Sale Impairments
Property is reviewed for impairment if events or changes in circumstances indicate that the carrying amount of the property, including any identifiable intangible assets, site costs and capitalized interest, may not be recoverable. In such an event, a comparison is made of the current and projected operating cash flows of each such property into the foreseeable future on an undiscounted basis to the carrying amount of such property. If we conclude that an impairment may have occurred, estimated fair values are determined by management utilizing cash flow models, market capitalization rates and market discount rates, or by obtaining third-party broker valuation estimates, appraisals, bona fide purchase offers or the expected sales price of an executed sales agreement in accordance with our fair value measurements accounting policy.
Investments in Real Estate Joint Ventures and Partnerships Impairments
The fair value of our investment in partially owned real estate joint ventures and partnerships is estimated by management based on a number of factors, including the performance of each investment, the life and other terms of the investment, market conditions, cash flow models, market Market capitalization rates and market discount rates or by obtaining third-party broker valuation estimates, appraisals and bona fide purchase offers in accordance with our fair value measurements accounting policy. We recognize an impairment loss if we determine the fair value of an investment is less than its carrying amount and that loss in value is other than temporary.
Subordinate Tax Increment Revenue Bonds Impairment
Investments in tax increment revenue bonds and tax increment revenue notes are reviewed for impairment if changes in circumstances or forecasts indicate that the carrying amount may not be recoverable, and in the case of the bonds, if it is uncertain if the investment will be held to maturity. In such an event, a comparison is made of the projected recoverability of cash flows from the tax increment revenue bonds and note to the carrying amount of each investment. If we conclude that an impairment may have occurred, fair values are determined by managementreviewing current sales of similar properties and transactions, and utilizing third-party sales revenue projections until the maturity of the bondsmanagement’s knowledge and notes and discounted cash flow models.
Assetsexpertise in property marketing.
No assets were measured at fair value on a nonrecurring basis at December 31, 2011,2014. Assets measured at fair value on a nonrecurring basis at December 31, 2013, aggregated by the level in the fair value hierarchy in which those measurements fall, are as follows (in thousands): | | | 000000000 | | | | 000000000 | | | | 000000000 | | | | 000000000 | | | | 000000000 | |
| | | Quoted Prices in
Active Markets for
Identical Assets
and Liabilities
(Level 1) | | | Significant Other
Observable Inputs
(Level 2) | | | Significant
Unobservable
Inputs
(Level 3) | | | Fair Value | | | Total Gains
(Losses) (1) | |
Property | | | | | | $ | 389 | | | $ | 98,207 | | | $ | 98,596 | | | $ | (36,907) | |
Property held for sale | | | | | | | 43,657 | | | | 1,500 | | | | 45,157 | | | | (13,799) | |
Investment in real estate joint ventures and partnerships | | | | | | | | | | | 6,311 | | | | 6,311 | | | | (1,752) | |
Subordinate tax increment revenue bonds | | | | | | | | | | | 26,723 | | | | 26,723 | | | | (18,737) | |
| | | | | | | | | | | | | | | | | | | | |
Total | | $ | - | | | $ | 44,046 | | | $ | 132,741 | | | $ | 176,787 | | | $ | (71,195) | |
| | | | | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | |
| | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | | Significant Other Observable Inputs (Level 2) | | Significant Unobservable Inputs (Level 3) | | Fair Value | | Total Gains (Losses) (1) |
Property (2) | | | $ | 3,300 |
| | $ | 8,576 |
| | $ | 11,876 |
| | $ | (2,358 | ) |
| Total | $ | — |
| | $ | 3,300 |
| | $ | 8,576 |
| | $ | 11,876 |
| | $ | (2,358 | ) |
___________________
| |
| (1) | Total gains (losses) exclude impairments on disposed assets. assets because they are no longer held by us. |
| |
| (2) | In accordance with our policy of evaluating and recording impairments on the disposal of long-lived assets, property with a carrying amount of $135.5 million was written down to a fair value of $98.6 million, resulting in a loss of $36.9 million, which was included in earnings for the period. Management’s estimate of the fair value of these properties was determined using the expected sales price of an executed agreement for the Level 2 input and using third party broker valuations, bona fide purchase offers, cash flow models and discount rates ranging from 8% to 13% for the Level 3 inputs.Property held for sale with a carrying amount of $57.0 million was written down to a fair value of $45.2 million less costs to sell of $2.0 million, resulting in a loss of $13.8 million, which was included in discontinued operations in the Consolidated Statements of Operations and Comprehensive Income for the period. Management’s estimate of the fair value of these properties was determined using the expected sales price of executed agreements for the Level 2 inputs and a cash flow model using a discount rate of 10% for the Level 3 input.
Our net investment in real estate joint ventures and partnerships with a carrying amount of $8.1 million was written down to a fair value of $6.3 million, resulting in a loss of $1.8 million, which was included in earnings for the period. Management’s estimate of the fair value of these investments was determined using the life and other terms of the investment, our partner’s financial condition, cash flow models and market capitalization rates ranging from 7% to 9% for the Level 3 inputs.
A net credit loss on the exchange of bonds of $18.7 million was recognized upon the recall and replacement of our investment in tax increment revenue bonds by the Agency in April 2011. The exchange transaction resulted in us receiving approximately $16.5 million in cash proceeds and $57.7 million in new subordinated bonds replacing the face value of our $51.3 million of senior bonds and $22.4 million of subordinate bonds, which had been previously written down to a fair value of $10.7 million. The carrying value of the $57.7 million subordinated bonds received in the exchange were written down to their fair value of $26.7 million, of which a loss of $11.7 million was previously recognized in December 2010. The net credit loss resulted as management did not expect to recover the par value of the bonds based upon changes in terms of the bonds and future sales tax revenue projections of the development project through their maturity. Management’s estimates of the fair value of these investments were determined using third-party sales revenue projections, future growth rates ranging from 1% to 4% and inflation rates ranging from 1% to 2% for the Level 3 inputs.
Assets measured at fair value on a nonrecurring basis at December 31, 2010, aggregated by the level in the fair value hierarchy in which those measurements fall, are as follows (in thousands):
| | | 0000000000000000 | | | | 0000000000000000 | | | | 0000000000000000 | | | | 0000000000000000 | | | | 0000000000000000 | | | | | Quoted Prices in
Active Markets for
Identical Assets
and Liabilities
(Level 1) | | | Significant Other
Observable Inputs
(Level 2) | | | Significant
Unobservable
Inputs
(Level 3) | | | Fair Value | | | Total Gains
(Losses) (1) | | Property | | | | | | | | | | $ | 2,325 | | | $ | 2,325 | | | $ | (2,827) | | Subordinate tax increment revenue bonds | | | | | | | | | | | 10,700 | | | | 10,700 | | | | (11,717) | | Subordinate tax increment revenue note | | | | | | | | | | | | | | | | | | | (598) | | | | | | | | | | | | | | | | | | | | | | | Total | | $ | - | | | $ | - | | | $ | 13,025 | | | $ | 13,025 | | | $ | (15,142) | | | | | | | | | | | | | | | | | | | | | | |
| (1) | Total gains (losses) exclude impairments on disposed assets.
the disposal of long-lived assets, property with a carrying amount of $14.3 million was written down to a fair value of $11.9 million, resulting in a loss of $2.4 million, which was included in earnings for the period. Management’s estimate of the fair value of these properties was determined using bona fide purchase offers for the Level 2 inputs. See the quantitative information about the significant unobservable inputs used for our Level 3 fair value measurements table below. |
At December 31, 2010, property with a total carrying amount of $5.1 million was written down to its fair value of $2.3 million, resulting in a loss of $2.8 million, which was included in earnings. Management’s estimate of the fair value of this property was determined using third party broker valuations for the Level 3 inputs.
In addition, at December 31, 2010, our subordinate tax increment revenue investments, the bonds issued by the Agency with a carrying value of $22.4 million, were written down to their fair value of $10.7 million as they are no longer classified as held to maturity. Also, our note with a carrying value of $.6 million was written down to its fair value of zero. Management’s estimates of the fair value of these investments were determined using third-party sales revenue projections and future growth and inflation rates for the Level 3 inputs.
Unless otherwise describedlisted below, short-term financial instruments and receivables are carried at amounts which approximate their fair values based on their highly-liquid nature, short-term maturities and/or expected interest rates for similar instruments. Notes Receivable from Real Estate Joint Ventures and Partnerships
We estimated the
Schedule of our fair value of our notes receivable from real estate joint ventures and partnerships based on quoted market prices for publicly-traded notes and on the discounted estimated future cash receipts. The discount rates used approximate current lending rates for a note or groups of notes with similar maturities and credit quality, assumes the note is outstanding through maturity and considers the note’s collateral (if applicable). We have utilized market information as available or present value techniques to estimate the amounts required to be disclosed. Since such amounts are estimates that are based on limited available market information for similar transactions, there can be no assurance that the disclosed value of any financial instrument could be realized by immediate settlement of the instrument.Schedule of the fair value of our notesdisclosures is as follows (in thousands):
| | | 000000000000000 | | | | 000000000000000 | | | | | December 31, | | | | | 2011 | | | 2010 | | | | | Carrying value | | $ | 149,204 | | | $ | 184,788 | | Fair value | | | 153,532 | | | | 187,959 | |
Tax Increment Revenue Bonds
We estimated the fair value of our held to maturity subordinated tax increment revenue bonds, which were issued by the Agency in connection with our investment in a development project in Sheridan, Colorado, based on assumptions that management believes market participants would use in pricing, using widely accepted valuation techniques including discounted cash flow analysis based on the expected future sales tax revenues of the development project. This analysis reflects the contractual terms of the bonds, including the period to maturity, and uses observable market-based inputs, such as market discount rates and unobservable market-based inputs, such as future growth and inflation rates. Since such amounts are estimates that are based on limited available market information for similar transactions, there can be no assurance that the disclosed value of any financial instrument could be realized by immediate settlement of the instrument. At December 31, 2011, the carrying value of these bonds was $26.5 million, which approximates its fair value. No such bonds were held to maturity at December 31, 2010.
A reconciliation of the credit loss recognized on our subordinated tax increment revenue bonds at December 31, 2011 is as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | December 31, | | | 2014 | | 2013 | | | Carrying Value | | Fair Value Using Significant Other Observable Inputs (Level 2) | | Fair Value Using Significant Unobservable Inputs (Level 3) | | Carrying Value | | Fair Value Using Significant Unobservable Inputs (Level 3) | Notes receivable from real estate joint ventures and partnerships | $ | — |
| | | | $ | — |
| | $ | 13,330 |
| | $ | 13,549 |
| Tax increment revenue bonds (1) | 25,392 |
| | | | 25,392 |
| | 25,850 |
| | 25,850 |
| Investments, held to maturity (2) | 2,750 |
| | $ | 2,742 |
| | | | | | | | Debt: | | | | | | | | | | | Fixed-rate debt | 1,651,959 |
| | | | 1,719,775 |
| | 2,136,265 |
| | 2,150,891 |
| | Variable-rate debt | 286,229 |
| | | | 292,972 |
| | 163,579 |
| | 172,349 |
|
___________________ | | | | | | (1) | At December 31, 2014 and 2013, the credit loss balance on our tax increment revenue bonds was $31.0 million. |
| Credit Loss Recognized | | Beginning balance, January 1, 2011
(2) | | Investments held to maturity are recorded at cost and have a gross unrealized loss of $ | 11,717 | | Additions
| | | 19,305 | | | | | | | Ending balance,8 thousand as of December 31, 2011
| | $ | 31,022 | | | | | | 2014. |
DebtWe estimatedThe quantitative information about the significant unobservable inputs used for our Level 3 fair value measurements as of our debt based on quoted market prices for publicly-traded debtDecember 31, 2014 and on2013 reported in the discounted estimated future cash payments to be made for other debt. The discount rates used approximate current lending rates for loans or groups of loans with similar maturities and credit quality, assumes the debt is outstanding through maturity and considers the debt’s collateral (if applicable). We have utilized market information as available or present value techniques to estimate the amounts required to be disclosed. Since such amounts are estimates that are based on limited available market information for similar transactions, there can be no assurance that the disclosed value of any financial instrument could be realized by immediate settlement of the instrument.
Schedule of the fair value of our debtabove tables, is as follows (in thousands):
| | | 0000000000000000 | | | | 0000000000000000 | | | | | December 31, | | | | | 2011 | | | 2010 | | Fixed-rate debt: | | | | | | | | | Carrying value | | $ | 2,014,834 | | | $ | 2,349,802 | | Fair value | | | 2,054,670 | | | | 2,393,471 | | | | | Variable-rate debt: | | | | | | | | | Carrying value | | $ | 517,003 | | | $ | 239,646 | | Fair value | | | 531,353 | | | | 252,207 | |
follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | Description | | Fair Value at December 31, | | Unobservable Inputs | | Range | | | | | | 2014 | | 2013 | | | | | Minimum | | Maximum | | | | (in thousands) | | Valuation Technique | | | 2014 | 2013 | | 2014 | 2013 | | | Property | | $ | — |
| | $ | 8,576 |
| | Broker valuation estimate | | Indicative bid | | | | | | | | | Notes receivable from real estate joint ventures and partnerships | | — |
| | 13,549 |
| | Discounted cash flows | | Discount rate | | | | |
|
| 2.7 | % | | | Tax increment revenue bonds | | 25,392 |
| | 25,850 |
| | Discounted cash flows | | Discount rate | | | | | 7.5 | % | 7.5 | % | | | | | | | | | | | Expected future growth rate | | 1.0 | % | 1.0 | % | | 2.0 | % | 2.0 | % | | | | | | | | | | | Expected future inflation rate | | 1.0 | % | 1.0 | % | | 2.0 | % | 2.0 | % | | | Fixed-rate debt | | 1,719,775 |
| | 2,150,891 |
| | Discounted cash flows | | Discount rate | | 1.3 | % | 1.3 | % | | 5.1 | % | 7.4 | % | | | Variable-rate debt | | 292,972 |
| | 172,349 |
| | Discounted cash flows | | Discount rate | | 1.2 | % | .8 | % | | 2.9 | % | 5.0 | % |
Note 25. Segment InformationThe reportable segments presented are the segments for which separate financial information is available, and for which operating performance is evaluated regularly by senior management in deciding how to allocate resources and in assessing performance. We evaluate the performance of the reportable segments based on net operating income, defined as total revenues less operating expenses and real estate taxes. Management does not consider the effect of gains or losses from the sale of property in evaluating segment operating performance.
The shopping center segment is engaged in the acquisition, development and management of real estate, primarily anchored neighborhood and community shopping centers located in Arizona, Arkansas, California, Colorado, Florida, Georgia, Illinois, Kansas, Kentucky, Louisiana, Maine, Missouri, Nevada, New Mexico, North Carolina, Oklahoma, Oregon, South Carolina, Tennessee, Texas, Utah, Virginia and Washington. The customer base includes supermarkets, discount retailers, drugstores and other retailers who generally sell basic necessity-type commodities. The industrial segment is engaged in the acquisition, development and management of bulk warehouses and office/service centers. Its properties are located in California, Florida, Georgia, Tennessee, Texas and Virginia, and the customer base is diverse. Included in “Other” are corporate-related items, insignificant operations and costs that are not allocated to the reportable segments.
Information concerning our reportable segments is as follows (in thousands):
| | | 000000000000000 | | | | 000000000000000 | | | | 000000000000000 | | | | 000000000000000 | | | | | Shopping
Center | | | Industrial | | | Other | | | Total | | | | | | | Year Ended December 31, 2011: | | | | | | | | | | | | | | | | | Revenues | | $ | 481,734 | | | $ | 49,237 | | | $ | 10,590 | | | $ | 541,561 | | Net Operating Income | | | 340,784 | | | | 33,201 | | | | 1,676 | | | | 375,661 | | Equity in Earnings (Loss) of Real Estate Joint Ventures and Partnerships, net | | | 7,259 | | | | 806 | | | | (231) | | | | 7,834 | | Capital Expenditures | | | 166,067 | | | | 8,908 | | | | 5,981 | | | | 180,956 | | | | | | | Year Ended December 31, 2010: | | | | | | | | | | | | | | | | | Revenues | | $ | 475,745 | | | $ | 50,523 | | | $ | 8,816 | | | $ | 535,084 | | Net Operating Income | | | 336,114 | | | | 34,676 | | | | 619 | | | | 371,409 | | Equity in Earnings (Loss) of Real Estate Joint Ventures and Partnerships, net | | | 12,222 | | | | 1,053 | | | | (386) | | | | 12,889 | | Capital Expenditures | | | 144,196 | | | | 23,892 | | | | 27,411 | | | | 195,499 | | | | | | | Year Ended December 31, 2009: | | | | | | | | | | | | | | | | | Revenues | | $ | 492,875 | | | $ | 51,854 | | | $ | 7,497 | | | $ | 552,226 | | Net Operating Income (Loss) | | | 349,930 | | | | 36,008 | | | | (598) | | | | 385,340 | | Equity in Earnings (Loss) of Real Estate Joint Ventures and Partnerships, net | | | 4,949 | | | | 967 | | | | (368) | | | | 5,548 | | Capital Expenditures | | | 84,252 | | | | 9,388 | | | | 3,917 | | | | 97,557 | | | | | | | As of December 31, 2011: | | | | | | | | | | | | | | | | | Investment in Real Estate Joint Ventures and Partnerships, net | | $ | 305,876 | | | $ | 35,732 | | | $ | - | | | $ | 341,608 | | Total Assets | | | 3,336,507 | | | | 344,559 | | | | 907,160 | | | | 4,588,226 | | | | | | | As of December 31, 2010: | | | | | | | | | | | | | | | | | Investment in Real Estate Joint Ventures and Partnerships, net | | $ | 309,171 | | | $ | 38,355 | | | $ | - | | | $ | 347,526 | | Total Assets | | | 3,469,694 | | | | 363,153 | | | | 975,008 | | | | 4,807,855 | |
Segment net operating income reconciles to income from continuing operations as shown on the Consolidated Statements of Operations and Comprehensive Income as follows (in thousands):
| | | 000000000000000 | | | | 000000000000000 | | | | 000000000000000 | | | | | Year Ended December 31, | | | | | 2011 | | | 2010 | | | 2009 | | Total Segment Net Operating Income | | $ | 375,661 | | | $ | 371,409 | | | $ | 385,340 | | Depreciation and Amortization | | | (152,983) | | | | (145,893) | | | | (142,549) | | Impairment Loss | | | (58,734) | | | | (33,317) | | | | (34,983) | | General and Administrative | | | (25,528) | | | | (24,993) | | | | (25,921) | | Interest Expense, net | | | (141,757) | | | | (148,152) | | | | (152,041) | | Interest and Other Income, net | | | 5,062 | | | | 9,825 | | | | 11,425 | | Equity in Earnings of Real Estate Joint Ventures and Partnerships, net | | | 7,834 | | | | 12,889 | | | | 5,548 | | (Loss) Gain on Redemption of Convertible Senior Unsecured Notes | | | - | | | | (135) | | | | 25,311 | | Gain on Land and Merchant Development Sales | | | - | | | | - | | | | 18,688 | | Provision for Income Taxes | | | (395) | | | | (180) | | | | (6,269) | | | | | | | | | | | | | | | Income from Continuing Operations | | $ | 9,160 | | | $ | 41,453 | | | $ | 84,549 | | | | | | | | | | | | | | |
Note 26. Quarterly Financial Data (Unaudited)
Summarized quarterly financial data is as follows (in thousands): | | | 000000000000000 | | | | 000000000000000 | | | | 000000000000000 | | | | 000000000000000 | | | | | First | | | Second | | | Third | | | Fourth | | 2011: | | | | | | | | | | | | | | | | | Revenues (1) | | $ | 130,469 | | | $ | 136,638 | | | $ | 138,544 | | | $ | 135,910 | | Net income (loss) attributable to common shareholders | | | 7,227 | | | | (7,166) (2) | | | | (42,089 | ) (2) | | | 22,173 (3) | | Earnings per common share – basic | | | 0.06 | | | | (0.06) (2) | | | | (0.35 | ) (2) | | | 0.18 (3) | | Earnings per common share – diluted | | | 0.06 | | | | (0.06) (2) | | | | (0.35 | ) (2) | | | 0.18 (3) | | | | | | | 2010: | | | | | | | | | | | | | | | | | Revenues (1) | | $ | 132,216 | | | $ | 133,912 | | | $ | 134,128 | | | $ | 134,828 | | Net income (loss) attributable to common shareholders | | | 10,239 | | | | (5,566) (2) | | | | 8,660 | | | | (2,603) (2) | | Earnings per common share – basic | | | 0.09 | | | | (0.05) (2) | | | | 0.07 | | | | (0.02) (2) | | Earnings per common share – diluted | | | 0.08 | | | | (0.05) (2) | | | | 0.07 | | | | (0.02) (2) | |
| | | | | | | | | | | | | | | | | | | | First | | Second | | Third | | Fourth | | | 2014 | | | | | | | | | Revenues (1) | $ | 127,592 |
| | $ | 130,191 |
| | $ | 130,521 |
| | $ | 126,102 |
| | | Net income | 64,781 |
| (2)(3) | 36,984 |
| (2)(4) | 102,199 |
| (2)(5) | 103,615 |
| (2)(6) | Net income attributable to common shareholders | 60,593 |
| (2)(3) | 32,686 |
| (2)(4) | 97,619 |
| (2)(5) | 86,270 |
| (2)(6)(7) | Earnings per common share – basic | 0.50 |
| (2)(3) | 0.27 |
| (2)(4) | 0.80 |
| (2)(5) | 0.71 |
| (2)(6)(7) | Earnings per common share – diluted | 0.49 |
| (2)(3) | 0.27 |
| (2)(4) | 0.79 |
| (2)(5) | 0.70 |
| (2)(6)(7) | | 2013 | | | | | | | | | Revenues (1) | $ | 117,827 |
| | $ | 121,995 |
| | $ | 123,302 |
| | $ | 126,071 |
| | | Net income | 44,817 |
| (2)(8) | 104,178 |
| (2) | 62,389 |
| (2) | 53,772 |
| (2) | Net income attributable to common shareholders | 33,668 |
| (2)(8) | 45,421 |
| (2)(9) | 57,832 |
| (2) | 47,224 |
| (2) | Earnings per common share – basic | 0.28 |
| (2)(8) | 0.37 |
| (2)(9) | 0.48 |
| (2) | 0.39 |
| (2) | Earnings per common share – diluted | 0.28 |
| (2)(8) | 0.37 |
| (2)(9) | 0.47 |
| (2) | 0.38 |
| (2) |
___________________ | | | (1) | Revenues from the sale of operating properties classified as discontinued operations have been reclassified and reported in discontinued operations for all periods presented. |
| | | (2) | The quarter results include significant impairment charges.
|
(3) | The quarter results include significant gains on the sale of properties.properties and real estate joint venture and partnership interests and on acquisitions. Gain amounts are: $41.4 million, $6.8 million, $69.5 million and $74.9 million for the three months ended March 31, 2014, June 30, 2014, September 30, 2014 and December 31, 2014, respectively, and $11.7 million, $78.4 million, $38.4 million and $25.2 million for the three months ended March 31, 2013, June 30, 2013, September 30, 2013 and December 31, 2013, respectively. |
| | | (3) | The quarter results include accelerated depreciation of $3.6 million related to a redevelopment project and a $1.5 million recovery of a receivable. |
| | | (4) | The quarter results include the realization of a $2.1 million tax benefit associated with the sale of unimproved land in our taxable REIT subsidiary. |
| | | (5) | The quarter results include gains on the sale of properties in our equity method investments of $2.9 million and a $1.2 million write-off of debt costs associated with the redemption of our 8.1% senior unsecured notes. |
| | | (6) | The quarter results include gains on the sale of properties in our equity method investments of $1.9 million and a $1.0 million impairment loss associated primarily with the disposition of a land parcel and a shopping center. |
| | | (7) | The quarter results include net income attributable to noncontrolling interests of $14.6 million associated with applicable gains discussed in (2) above. |
| | | (8) | The quarter results include a write-off of an above-market assumed mortgage intangible due to the early payoff of the related mortgage of $9.7 million. |
| | | (9) | The quarter results include net income attributable to noncontrolling interests of $37.7 million associated with applicable gains discussed in (2) above and a $15.7 million deduction associated with the redemption of Series F preferred shares (see Note 9 for additional information). |
Note 26. Subsequent Events Subsequent to December 31, 2014, we acquired one center in Texas with a gross purchase price of $43.1 million and sold two centers with gross proceeds totaling $25.1 million. No impairment was realized associated with our property dispositions, and we have not completed the accounting for this recent acquisition, but anticipate that the purchase price will primarily be allocated to building, land and other identifiable intangible assets and liabilities. Also, we are in negotiations associated with a $200 million unsecured five-year term note and a ten-year extension of an existing $66 million secured note, which are anticipated to close by the first quarter of 2015. The proceeds of the term note will be used for general corporate purposes, and the interest rate associated with the existing secured note is anticipated to be reduced by 3.9% to 3.5% with approximately $6.1 million of debt extinguishment costs being realized. * * * * * ITEM 9. | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure Not applicable. ITEM 9A. Controls and Procedures | Controls and Procedures |
Under the supervision and with the participation of our principal executive officer and principal financial officer, management has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934) as of December 31, 2011.2014. Based on that evaluation, our principal executive officer and our principal financial officer have concluded that our disclosure controls and procedures were effective as of December 31, 2011. 2014. There has been no change to our internal control over financial reporting during the quarter ended December 31, 20112014 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. MANAGEMENT’S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING Weingarten Realty Investors and its subsidiaries (“WRI”) maintain a system of internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act, which is a process designed under the supervision of WRI’s principal executive officer and principal financial officer and effected by WRI’s Board of Trust Managers, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. WRI’s internal control over financial reporting includes those policies and procedures that: ¡
Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of WRI’s assets; ¡
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of WRI are being made only in accordance with authorizations of management and trust managers of WRI; and ¡
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of WRI’s assets that could have a material effect on the financial statements. WRI’s management has responsibility for establishing and maintaining adequate internal control over financial reporting for WRI. Management, with the participation of WRI’s Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of WRI’s internal control over financial reporting as of December 31, 20112014 based on the framework inInternal Control—Integrated Framework(2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on their evaluation of WRI’s internal control over financial reporting, WRI’s management along with the Chief Executive Officer and Chief Financial Officer believe that WRI’s internal control over financial reporting is effective as of December 31, 2011.2014 . Deloitte & Touche LLP, WRI’s independent registered public accounting firm that audited the consolidated financial statements and financial statement schedules included in this Form 10-K, has issued an attestation report on the effectiveness of WRI’s internal control over financial reporting. February 29, 201219, 2015
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Trust Managers and Shareholders of Weingarten Realty Investors We have audited the internal control over financial reporting of Weingarten Realty Investors and subsidiaries (the “Company”"Company") as of December 31, 2011,2014, based on criteria established inInternal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report On Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. A company’s internal control over financial reporting is a process designed by, or under the supervision of, the company’s principal executive and principal financial officers, or persons performing similar functions, and effected by the company’s board of trust managers, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and trust managers of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2011,2014, based on the criteria established inInternal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated financial statements and financial statement schedules as of and for the year ended December 31, 2011,2014, of the Company and our report dated February 29, 2012,19, 2015, expressed an unqualified opinion on those financial statements and financial statement schedules.schedules and included an explanatory paragraph regarding the adoption of ASU 2014-08. /s/ Deloitte & Touche LLP February 29, 2012ITEM 9B. | Other Information |
19, 2015
ITEM 9B. Other Information PART III ITEM 10. Trust Managers, Executive Officers and Corporate Governance | Trust Managers, Executive Officers and Corporate Governance |
Information with respect to our trust managers and executive officers is incorporated herein by reference to the “Proposal One - Election“Election of Trust Managers - Nominees,” “Executive Officers”Proposal One," “Compensation Discussion and Analysis - Overview” and “Share Ownership of Certain Beneficial Owners and Management—Section 16(a) Beneficial Ownership Reporting Compliance”Management” sections of our definitive Proxy Statement for the Annual Meeting of Shareholders to be held May 8, 2012. April 28, 2015. Code of Conduct and Ethics We have adopted a code of business and ethics for trust managers, officers and employees, known as the Code of Conduct and Ethics. The Code of Conduct and Ethics is available on our website atwww.weingarten.com. Shareholders may request a free copy of the Code of Conduct and Ethics from: Weingarten Realty Investors Attention: Investor Relations 2600 Citadel Plaza Drive, Suite 125 We have also adopted a Code of Conduct for Officers and Senior Financial Associates setting forth a code of ethics applicable to our principal executive officer, principal financial officer, chief accounting officer and financial associates, which is available on our website atwww.weingarten.com. Shareholders may request a free copy of the Code of Conduct for Officers and Senior Financial Associates from the address and phone number set forth above. We have adopted Governance Guidelines, which are available on our website atwww.weingarten.com. Shareholders may request a free copy of the Governance Guidelines from the address and phone number set forth above under “Code of Conduct and Ethics.”ITEM 11. Executive Compensation | Executive Compensation |
Information with respect to executive compensation is incorporated herein by reference to the “Executive“Compensation Discussion and Analysis,” “Trust Manager Compensation,” “Proposal One - Election of Trust Managers,” “Compensation Committee Report,” “Summary Compensation Table” and “Trust Manager Compensation Table” sections of our definitive Proxy Statement for the Annual Meeting of Shareholders to be held May 8, 2012. | April 28, 2015. ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters | Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters |
The “Share Ownership of Certain Beneficial Owners and Management” section of our definitive Proxy Statement for the Annual Meeting of Shareholders to be held May 8, 2012April 28, 2015 is incorporated herein by reference. The following table summarizes the equity compensation plans under which our common shares of beneficial interest may be issued as of December 31, 2011: | | | | | | | | | Plan category | | Number of shares to
be issued upon exercise
of outstanding options,
warrants and rights | | | | Weighted average
exercise price of
outstanding options,
warrants and rights | | Number of shares
remaining available
for future issuance | | | | | | Equity compensation plans approved by shareholders | | 4,607,703 | | $ | | 28.09 | | 2,144,215 | | | | | | Equity compensation plans not approved by shareholders | | — | | | | — | | — | | | | | | | | | | | | | | | Total | | 4,607,703 | | $ | | 28.09 | | 2,144,215 | | | | | | | | | |
2014: | | | | | | | | | Plan category | | Number of shares to be issued upon exercise of outstanding options, warrants and rights | | Weighted average exercise price of outstanding options, warrants and rights | | Number of shares remaining available for future issuance | | Equity compensation plans approved by shareholders | | 2,897,123 | | $28.76 | | 1,437,633 | | Equity compensation plans not approved by shareholders | | — | | — | | — | | Total | | 2,897,123 | | $28.76 | | 1,437,633 |
ITEM 13. Certain Relationships and Related Transactions, and Trust Manager Independence | Certain Relationships and Related Transactions, and Trust Manager Independence |
The “Governance, of Our Company,” “Compensation Committee Interlocks and Insider Participation” and “Certain Transactions” sections of our definitive Proxy Statement for the Annual Meeting of Shareholders to be held May 8, 2012 April 28, 2015 are incorporated herein by reference.ITEM 14. Principal Accountant Fees and Services | Principal Accountant Fees and Services |
The “Independent Registered Public Accounting“Accounting Firm Fees” section within “Proposal Two – Ratification“Ratification of Independent Registered Public Accounting Firm”Firm - Proposal Two” of our definitive Proxy Statement for the Annual Meeting of Shareholders to be held May 8, 2012 April 28, 2015 is incorporated herein by reference.
PART IV ITEM 15. | Exhibits and Financial Statement Schedules |
ITEM 15. Exhibits and Financial Statement Schedules | | | | | | | | | | | | | | | (a) | | | | | | The following documents are filed as part of this Report: | Page | | | | Page
| | | (A) | | | | | | | | | | | (A)
| | | | | (B) | Financial Statements: | | | | | 44(i) | | | | | | | | (B)
| | Financial Statements:
| | | | | | | | | | | | | (i)
| | | | | | (ii) | | | | | | 45(iii) | | | | | | | | | | (ii)
| | | | | | | 46(iv) | | | | | | | | | | (iii)
| | | | | | | 47(v) | | | | | | | | | | (iv)
| | | | | | | 48(vi) | | | | | | | | | | (v)
| | | | | (C) | Financial Statement Schedules: | | | | | 49II | | | | | | | | (C)
| | Financial Statement Schedules:
| | | | | | | | | | | | | II
| | | | | | | 102III | | | | | | | | | | III
| | | | | | | 103IV | | | | | | | | | | IV
| | | | | 112 | |
All other schedules are omitted since the required information is not present or is not present in amounts sufficient to require submission of the schedule or because the information required is included in the consolidated financial statements and notes thereto.
| | | | | | (b) | | | | Exhibits: | | 3.1 | | — | | Restated Declaration of Trust (filed as Exhibit 3.1 to WRI’s Form 8-A dated January 19, 1999 and incorporated herein by reference). | | 3.2 | | — | | Amendment of the Restated Declaration of Trust (filed as Exhibit 3.2 to WRI’s Form 8-A dated January 19, 1999 and incorporated herein by reference). | | 3.3 | | — | | Second Amendment of the Restated Declaration of Trust (filed as Exhibit 3.3 to WRI’s Form 8-A dated January 19, 1999 and incorporated herein by reference). | | 3.4 | | — | | Third Amendment of the Restated Declaration of Trust (filed as Exhibit 3.4 to WRI’s Form 8-A dated January 19, 1999 and incorporated herein by reference). | | 3.5 | | — | | Fourth Amendment of the Restated Declaration of Trust dated April 28, 1999 (filed as Exhibit 3.5 to WRI’s Annual Report on Form 10-K for the year ended December 31, 2001 and incorporated herein by reference). | | 3.6 | | — | | Fifth Amendment of the Restated Declaration of Trust dated April 20, 2001 (filed as Exhibit 3.6 to WRI’s Annual Report on Form 10-K for the year ended December 31, 2001 and incorporated herein by reference). | | 3.7 | | — | | Amended and Restated Bylaws of WRI (filed as Exhibit 99.2 to WRI’s Form 8-A dated February 23, 1998 and incorporated herein by reference). | | 3.8 | | — | | Sixth Amendment of the Restated Declaration of Trust dated May 6, 2010 (filed as Exhibit 3.1 to WRI’s Form 8-K dated May 6, 2010 and incorporated herein by reference). | | 3.9 | | — | | Amendment of Bylaws-Direct Registration System, Section 7.2(a) dated May 3, 2007 (filed as Exhibit 3.8 to WRI’s Form 10-Q for the quarter ended June 30, 2007 and incorporated herein by reference). | | 3.10 | | — | | Second Amended and Restated Bylaws of Weingarten Realty Investors (filed as Exhibit 3.1 to WRI’s Form 8-K on February 26, 2010 and incorporated herein by reference). |
| | | | | | 4.1 | | — | | Form of Indenture between Weingarten Realty Investors and The Bank of New York Mellon Trust Company, N.A. (successor in interest to JPMorgan Chase Bank, National Association, formerly and Texas Commerce Bank National Association) (filed as Exhibit 4(a) to WRI’s Registration Statement on Form S-3 (No. 33-57659) dated February 10, 1995 and incorporated herein by reference). | | 4.2 | | — | | Form of Indenture between Weingarten Realty Investors and The Bank of New York Mellon Trust Company, N.A. (successor in interest to JPMorgan Chase Bank, National Association, formerly and Texas Commerce Bank National Association) (filed as Exhibit 4(b) to WRI’s Registration Statement on Form S-3 (No. 33-57659) and incorporated herein by reference). | | 4.3 | | — | | Form of Fixed Rate Senior Medium Term Note (filed as Exhibit 4.19 to WRI’s Annual Report on Form 10-K for the year ended December 31, 1998 and incorporated herein by reference). | | 4.4 | | — | | Form of Floating Rate Senior Medium Term Note (filed as Exhibit 4.20 to WRI’s Annual Report on Form 10-K for the year ended December 31, 1998 and incorporated herein by reference). | | 4.5 | | — | | Form of Fixed Rate Subordinated Medium Term Note (filed as Exhibit 4.21 to WRI’s Annual Report on Form 10-K for the year ended December 31, 1998 and incorporated herein by reference). | | 4.6 | | — | | Form of Floating Rate Subordinated Medium Term Note (filed as Exhibit 4.22 to WRI’s Annual Report on Form 10-K for the year ended December 31, 1998 and incorporated herein by reference). | | 4.7 | | — | | Statement of Designation of 6.75% Series D Cumulative Redeemable Preferred Shares (filed as Exhibit 3.1 to WRI’s Form 8-A dated April 17, 2003 and incorporated herein by reference).
| 4.8 | | — | | Statement of Designation of 6.95% Series E Cumulative Redeemable Preferred Shares (filed as Exhibit 3.1 to WRI’s Form 8-A dated July 8, 2004 and incorporated herein by reference).
| 4.9 | | — | | Statement of Designation of 6.50% Series F Cumulative Redeemable Preferred Shares (filed as Exhibit 3.1 to WRI’s Form 8-A dated January 29, 2007 and incorporated herein by reference). | 4.10 | 4.8 | — | | 6.75% Series D Cumulative Redeemable Preferred Share Certificate (filed as Exhibit 4.2 to WRI’s Form 8-A dated April 17, 2003 and incorporated herein by reference).
| 4.11 | | — | | 6.95% Series E Cumulative Redeemable Preferred Share Certificate (filed as Exhibit 4.2 to WRI’s Form 8-A dated July 8, 2004 and incorporated herein by reference).
| 4.12 | | — | | 6.50% Series F Cumulative Redeemable Preferred Share Certificate (filed as Exhibit 4.2 to WRI’s Form 8-A dated January 29, 2007 and incorporated herein by reference). | 4.13 | 4.9 | — | | Form of Receipt for Depositary Shares, each representing 1/30 of a share of 6.75% Series D Cumulative Redeemable Preferred Shares, par value $.03 per share (filed as Exhibit 4.3 to WRI’s Form 8-A dated April 17, 2003 and incorporated herein by reference).
| 4.14 | | — | | Form of Receipt for Depositary Shares, each representing 1/100 of a share of 6.95% Series E Cumulative Redeemable Preferred Shares, par value $.03 per share (filed as Exhibit 4.3 to WRI’s Form 8-A dated July 8, 2004 and incorporated herein by reference).
| 4.15 | | — | | Form of Receipt for Depositary Shares, each representing 1/100 of a share of 6.50% Series F Cumulative Redeemable Preferred Shares, par value $.03 per share (filed as Exhibit 4.3 to WRI’s Form 8-A dated January 29, 2007 and incorporated herein by reference). | 4.16 | 4.10 | — | | FormSecond Supplemental Indenture, dated October 9, 2012, between Weingarten Realty Investors and The Bank of 7% Notes due 2011New York Trust Company, National Association (successor to J.P. Morgan Chase Company, National Association) (filed as Exhibit 4.174.1 to WRI’s Annual ReportForm 8-K on Form 10-K for the year ended December 31, 2001October 9, 2012 and incorporated herein by reference).
| 4.17 | 4.11 | — | | Form of 3.95% Convertible3.375% Senior NotesNote due 20262022 (filed as Exhibit 4.2 to WRI’s Form 8-K on August 2, 2006October 9, 2012 and incorporated herein by reference). | 4.18 | 4.12 | — | | Form of 8.10%3.50% Senior Note due 20192023 (filed as Exhibit 4.1 to WRI’s Current Report on Form 8-K dated August 14, 2009on March 22, 2013 and incorporated herein by reference). | 10.1† | 4.13 | — | | The 1993 Incentive Share PlanForm of WRI4.450% Senior Note due 2024 (filed as Exhibit 4.1 to WRI’s Registration StatementForm 8-K on Form S-8 (No. 33-52473)October 15, 2013 and incorporated herein by reference).
|
| 10.2† | | | | 10.1† | — | | 2001 Long Term Incentive Plan (filed as Exhibit 10.7 to WRI’s Annual Report on Form 10-K for the year ended December 31, 2001 and incorporated herein by reference). | 10.3† | 10.2† | — | | Weingarten Realty Retirement Plan restated effective April 1, 2002 (filed as Exhibit 10.29 on WRI’s Annual Report on Form 10-K for the year ended December 31, 2005 and incorporated herein by reference).
| 10.4† | | — | | First Amendment to the Weingarten Realty Retirement Plan dated December 31, 2003 (filed as Exhibit 10.33 on WRI’s Annual Report on Form 10-K for the year ended December 31, 2005 and incorporated herein by reference).
| 10.5† | | — | | First Amendment to the Weingarten Realty Pension Plan dated August 1, 2005 (filed as Exhibit 10.27 on WRI’s Form 10-Q for the quarter ended September 30, 2005 and incorporated herein by reference).
|
| | | | | 10.6† | | — | | Mandatory Distribution Amendment for the Weingarten Realty Retirement Plan dated August 1, 2005 (filed as Exhibit 10.28 on WRI’s Form 10-Q for the quarter ended September 30, 2005 and incorporated herein by reference).
| 10.7† | | — | | Weingarten Realty Investors Supplemental Executive Retirement Plan amended and restated effective September 1, 2002 (filed as Exhibit 10.10 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
| 10.8† | | — | | First Amendment to the Weingarten Realty Investors Supplemental Executive Retirement Plan amended on November 3, 2003 (filed as Exhibit 10.11 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
| 10.9† | | — | | Second Amendment to the Weingarten Realty Investors Supplemental Executive Retirement Plan amended October 22, 2004 (filed as Exhibit 10.12 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
| 10.10† | | — | | Third Amendment to the Weingarten Realty Investors Supplemental Executive Retirement Plan amended October 22, 2004 (filed as Exhibit 10.13 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
| 10.11† | | — | | Weingarten Realty Investors Retirement Benefit Restoration Plan adopted effective September 1, 2002 (filed as Exhibit 10.14 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
| 10.12† | | — | | First Amendment to the Weingarten Realty Investors Retirement Benefit Restoration Plan amended on November 3, 2003 (filed as Exhibit 10.15 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
| 10.13† | | — | | Second Amendment to the Weingarten Realty Investors Retirement Benefit Restoration Plan amended October 22, 2004 (filed as Exhibit 10.16 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
| 10.14† | | — | | Third Amendment to the Weingarten Realty Pension Plan dated December 23, 2005 (filed as Exhibit 10.30 on WRI’s Annual Report on Form 10-K for the year ended December 31, 2005 and incorporated herein by reference).
| 10.15† | | — | | Weingarten Realty Investors Deferred Compensation Plan amended and restated as a separate and independent plan effective September 1, 2002 (filed as Exhibit 10.17 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
| 10.16† | | — | | Supplement to the Weingarten Realty Investors Deferred Compensation Plan amended on April 25, 2003 (filed as Exhibit 10.18 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
| 10.17† | | — | | First Amendment to the Weingarten Realty Investors Deferred Compensation Plan amended on November 3, 2003 (filed as Exhibit 10.19 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
| 10.18† | | — | | Second Amendment to the Weingarten Realty Investors Deferred Compensation Plan, as amended, dated October 13, 2005 (filed as Exhibit 10.29 on WRI’s Form 10-Q for the quarter ended September 30, 2005 and incorporated herein by reference).
| 10.19† | | — | | Trust Under the Weingarten Realty Investors Deferred Compensation Plan amended and restated effective October 21, 2003 (filed as Exhibit 10.21 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
| 10.20† | | — | | Fourth Amendment to the Weingarten Realty Investors Deferred Compensation Plan dated December 23, 2005 (filed as Exhibit 10.31 on WRI’s Annual Report on Form 10-K for the year ended December 31, 2005 and incorporated herein by reference).
| 10.21† | | — | | Trust Under the Weingarten Realty Investors Retirement Benefit Restoration Plan amended and restated effective October 21, 2003 (filed as Exhibit 10.22 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
| 10.22† | | — | | Trust Under the Weingarten Realty Investors Supplemental Executive Retirement Plan amended and restated effective October 21, 2003 (filed as Exhibit 10.23 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
| 10.23† | | — | | First Amendment to the Trust Under the Weingarten Realty Investors Deferred Compensation Plan, Supplemental Executive Retirement Plan, and Retirement Benefit Restoration Plan amended on March 16, 2004 (filed as Exhibit 10.24 on WRI’s Form 10-Q for the quarter ended June 30, 2005 and incorporated herein by reference).
|
| | | | | 10.24†
| | —
| | Third Amendment to the Weingarten Realty Investors Deferred Compensation Plan dated August 1, 2005 (filed as Exhibit 10.30 on WRI’s Form 10-Q for the quarter ended September 30, 2005 and incorporated herein by reference).
| 10.25†
| | —
| | Fifth Amendment to the Weingarten Realty Investors Deferred Compensation Plan (filed as Exhibit 10.34 to WRI’s Form 10-Q for quarter ended June 30, 2006 and incorporated herein by reference).
| 10.26†
| | —
| | Restatement of the Weingarten Realty Investors Supplemental Executive Retirement Plan dated August 4, 2006 (filed as Exhibit 10.35 to WRI’s Form 10-Q for the quarter ended September 30, 2006 and incorporated herein by reference). | 10.27†
10.3† | — | —
| | Restatement of the Weingarten Realty Investors Deferred Compensation Plan dated August 4, 2006 (filed as Exhibit 10.36 to WRI’s Form 10-Q for the quarter ended September 30, 2006 and incorporated herein by reference). | 10.28†
10.4† | — | —
| | Restatement of the Weingarten Realty Investors Retirement Benefit Restoration Plan dated August 4, 2006 (filed as Exhibit 10.37 to WRI’s Form 10-Q for the quarter ended September 30, 2006 and incorporated herein by reference). | 10.29†
10.5† | — | —
| | Amendment No. 1 to the Weingarten Realty Investors Supplemental Executive Retirement Plan dated December 15, 2006 (filed as Exhibit 10.38 to WRI’s Annual Report on WRI’s Form 10-K for the year ended December 31, 2006 and incorporated herein by reference). | 10.30†
10.6† | — | —
| | Amendment No. 1 to the Weingarten Realty Investors Retirement Benefit Restoration Plan dated December 15, 2006 (filed as Exhibit 10.39 to WRI’s Annual Report on WRI’s Form 10-K for the year ended December 31, 2006 and incorporated herein by reference). | 10.31†
10.7† | — | —
| | Amendment No. 1 to the Weingarten Realty Investors Deferred Compensation Plan dated December 15, 2006 (filed as Exhibit 10.40 to WRI’s Annual Report on WRI’s Form 10-K for the year ended December 31, 2006 and incorporated herein by reference). | 10.32†
10.8† | — | —
| | Amendment No. 2 to the Weingarten Realty Investors Retirement Benefit Restoration Plan dated November 9, 2007 (filed as Exhibit 10.43 to WRI’s Annual Report on WRI’s Form 10-K for the year ended December 31, 2007 and incorporated herein by reference). | 10.33†
10.9† | — | —
| | Amendment No. 2 to the Weingarten Realty Investors Deferred Compensation Plan dated November 9, 2007 (filed as Exhibit 10.44 to WRI’s Annual Report on WRI’s Form 10-K for the year ended December 31, 2007 and incorporated herein by reference). | 10.34†
10.10† | — | —
| | Amendment No. 2 to the Weingarten Realty Investors Supplemental Executive Retirement Plan dated November 9, 2007 (filed as Exhibit 10.45 to WRI’s Annual Report on WRI’s Form 10-K for the year ended December 31, 2007 and incorporated herein by reference). | 10.35†
10.11† | — | —
| | Fifth Amendment to the Weingarten Realty Retirement Plan dated August 1, 2008 (filed as Exhibit 10.48 on WRI’s Form 10-Q for the quarter ended September 30, 2008 and incorporated herein by reference).
| 10.36†
| | —
| | Amendment No. 3 to the Weingarten Realty Investors Retirement Benefit Restoration Plan dated November 17, 2008 (filed as Exhibit 10.1 onto WRI’s Form 8-K on December 4, 2008 and incorporated herein by reference). | 10.37†
10.12† | — | —
| | Amendment No. 3 to the Weingarten Realty Investors Deferred Compensation Plan dated November 17, 2008 (filed as Exhibit 10.2 onto WRI’s Form 8-K on December 4, 2008 and incorporated herein by reference). | 10.38†
10.13† | — | —
| | Amendment No. 3 to the Weingarten Realty Investors Supplemental Executive Retirement Plan dated November 17, 2008 (filed as Exhibit 10.3 onto WRI’s Form 8-K on December 4, 2008 and incorporated herein by reference). | 10.39†
10.14† | — | —
| | Amendment No. 1 to the Weingarten Realty Investors 2001 Long Term Incentive Plan dated November 17, 2008 (filed as Exhibit 10.4 onto WRI’s Form 8-K on December 4, 2008 and incorporated herein by reference). | 10.40†
10.15† | — | —
| | Severance and Change to Control Agreement for Johnny Hendrix dated November 11, 1998 (filed as Exhibit 10.54 to WRI’s Annual Report on WRI’s Form 10-K for the year ended December 31, 2008 and incorporated herein by reference). |
| | | | | 10.41†
10.16† | — | —
| | Severance and Change to Control Agreement for Stephen C. Richter dated November 11, 1998 (filed as Exhibit 10.55 to WRI’s Annual Report on WRI’s Form 10-K for the year ended December 31, 2008 and incorporated herein by reference). | 10.42†
10.17† | — | —
| | Amendment No. 1 to Severance and Change to Control Agreement for Johnny Hendrix dated December 20, 2008 (filed as Exhibit 10.56 to WRI’s Annual Report on WRI’s Form 10-K for the year ended December 31, 2008 and incorporated herein by reference). | 10.43†
10.18† | — | —
| | Amendment No. 1 to Severance and Change to Control Agreement for Stephen Richter dated December 31, 2008 (filed as Exhibit 10.57 to WRI’s Annual Report on WRI’s Form 10-K for the year ended December 31, 2008 and incorporated herein by reference). | 10.44
10.19 | — | —
| | Promissory Note with Reliance Trust Company, Trustee of the Trust under the Weingarten Realty Investors Deferred Compensation Plan, Supplemental Executive Retirement Plan and Retirement Benefit Restoration Plan dated March 12, 2009 (filed as Exhibit 10.57 onto WRI’s Form 10-Q for the quarter ended March 31, 2009 and incorporated herein by reference). | 10.45†
10.20† | — | —
| | First Amendment to the Weingarten Realty Retirement Plan, amended and restated, dated December 2, 2009 (filed as Exhibit 10.51 onto WRI’s Annual Report on Form 10-K for the year ended December 31, 2009 and incorporated herein by reference). |
| 10.46
| | —
| | Amended and Restated Credit Agreement dated February 11, 2010 among Weingarten Realty Investors, the Lenders Party Thereto and JPMorgan Chase Bank, N.A., as Administrative Agent (filed as Exhibit 10.1 on WRI’s Form 8-K on February 16, 2010 and incorporated herein by reference).
| 10.47†
10.21† | — | —
| | First Amendment to the Master Nonqualified Plan Trust Agreement dated March 12, 2009 (filed as Exhibit 10.53 onto WRI’s Annual Report on Form 10-K for the year ended December 31, 2009 and incorporated herein by reference). | 10.48†
10.22† | — | —
| | Second Amendment to the Master Nonqualified Plan Trust Agreement dated August 4, 2009 (filed as Exhibit 10.54 onto WRI’s Annual Report on Form 10-K for the year ended December 31, 2009 and incorporated herein by reference). | 10.49†
10.23† | — | —
| | Non-Qualified Plan Trust Agreement for Recordkept Plans dated September 1, 2009 (filed as Exhibit 10.55 onto WRI’s Annual Report on Form 10-K for the year ended December 31, 2009 and incorporated herein by reference). | 10.50†
10.24† | — | —
| | Amended and Restated 2010 Long-Term Incentive Plan (filed as Exhibit 99.1 to WRI’s Form 8-K dated April 26, 2010 and incorporated herein by reference). | 10.51†
10.25�� | — | —
| | Amendment No. 4 to the Weingarten Realty Investors Deferred Compensation Plan dated February 26, 2010 (filed as Exhibit 10.57 onto WRI’s Form 10-Q for the quarter ended March 31, 2010 and incorporated herein by reference). | 10.52†
10.26† | — | —
| | Amendment No. 4 to the Weingarten Realty Investors Supplemental Executive Retirement Plan dated May 6, 2010 (filed as Exhibit 10.58 onto WRI’s Form 10-Q for the quarter ended March 31, 2010 and incorporated herein by reference). | 10.53
10.27 | — | —
| | First Amendment to Promissory Note with Reliance Trust Company, Trustee of the Master Nonqualified Plan Trust under Weingarten Realty Investors Supplemental Executive Retirement Plan and Weingarten Realty Investors Retirement Benefit Restoration Plan dated March 11, 2010 (filed as Exhibit 10.59 onto WRI’s Form 10-Q for the quarter ended June 30, 2010 and incorporated herein by reference). | 10.54†
10.28† | — | —
| | 2002 WRI Employee Share Purchase Plan dated May 6, 2003 (filed as Exhibit 10.60 onto WRI’s Form 10-Q for the quarter ended June 30, 2010 and incorporated herein by reference). | 10.55†
10.29† | — | —
| | Amended and Restated 2002 WRI Employee Share Purchase Plan dated May 10, 2010 (filed as Exhibit 10.61 onto WRI’s Form 10-Q for the quarter ended June 30, 2010 and incorporated herein by reference). | 10.56
10.30 | — | —
| | Fixed Rate Promissory Note with JPMorgan Chase Bank, National Association dated May 11, 2010 (filed as Exhibit 10.62 onto WRI’s Form 10-Q for the quarter ended June 30, 2010 and incorporated herein by reference). | 10.57†
10.31† | — | —
| | Weingarten Realty Investors Executive Medical Reimbursement Plan and Summary Plan Description (filed as Exhibit 10.59 to WRI’s Annual Report on WRI’s Form 10-K dated December 31, 2010 and incorporated herein by reference). | 10.58
10.32 | — | —
| | Second Amendment to Promissory Note with Reliance Trust Company, Trustee of the Master Nonqualified Plan Trust under the Weingarten Realty Investors Supplemental Executive Retirement Plan and Weingarten Realty Investors Retirement Benefit Restoration Plan dated March 11, 2011 (filed as Exhibit 10.58 onto WRI’s Form 10-Q for the quarter ended March 31, 2011 and incorporated herein by reference). | 10.59†
10.33† | — | —
| | Second Amendment to the Weingarten Realty Retirement Plan dated March 14, 2011 (filed as Exhibit 10.59 onto WRI’s Form 10-Q for the quarter ended March 31, 2011 and incorporated herein by reference). | 10.60†
10.34† | — | —
| | Third Amendment to the Weingarten Realty Retirement Plan dated May 4, 2011 (filed as Exhibit 10.60 onto WRI’s Form 10-Q for the quarter ended March 31, 2011 and incorporated herein by reference). |
| | | | | 10.61†
10.35† | — | —
| | Third Amendment to the Master Nonqualified Plan Trust Agreement dated April 26, 2011 (filed as Exhibit 10.1 onto WRI’s Form 10-Q for the quarter ended June 30, 2011 and incorporated herein by reference). | 10.62
10.36 | — | —
| | Amended and Restated Credit Agreement dated September 30, 2011 (filed as Exhibit 10.1 onto WRI’s Form 8-K on October 4, 2011 and incorporated herein by reference). | 10.63
10.37 | — | —
| | Credit Agreement dated August 29, 2011 among Weingarten Realty Investors, the Lenders Party Hereto and The Bank of Nova Scotia, as Administrative Agent (filed as Exhibit 10.1 onto WRI’s Form 8-K on August 31, 2011 and incorporated herein by reference). | 10.64
10.38 | — | —
| | Credit Agreement Note dated August 29, 2011 with The Bank of Nova Scotia (filed as Exhibit 10.2 onto WRI’s Form 8-K on August 31, 2011 and incorporated herein by reference). | 10.65
10.39 | — | —
| | Credit Agreement Note dated August 29, 2011 with Compass Bank (filed as Exhibit 10.3 onto WRI’s Form 8-K on August 31, 2011 and incorporated herein by reference). | 10.66
10.40 | — | —
| | Credit Agreement Note dated August 29, 2011 with PNC Bank, National Association (filed as Exhibit 10.4 onto WRI’s Form 8-K on August 31, 2011 and incorporated herein by reference). | 10.67
10.41 | — | —
| | Credit Agreement Note dated August 29, 2011 with Sumitomo Mitsui Banking Corporation (filed as Exhibit 10.5 onto WRI’s Form 8-K on August 31, 2011 and incorporated herein by reference). |
| 10.68
| | —
| | 10.42 | — | Credit Agreement Note dated August 29, 2011 U.S. Bank National Association (filed as Exhibit 10.6 onto WRI’s Form 8-K on August 31, 2011 and incorporated herein by reference). | 10.69
10.43 | — | —
| | Guaranty associated with Credit Agreement among Weingarten Realty Investors, the Lenders Party Hereto and The Bank of Nova Scotia, as Administrative Agent, dated August 29, 2011 (filed as Exhibit 10.7 onto WRI’s Form 8-K on August 31, 2011 and incorporated herein by reference). | 10.70*
10.44 | — | —
| | Amendment Agreement dated September 30, 2011 to Amended and Restated Credit Agreement dated September 30, 2011. 2011 (filed as Exhibit 10.70 to WRI’s Annual Report on Form 10-K for the year ended December 31, 2011 and incorporated herein by reference). | 10.71*
10.45 | — | —
| | Amendment Agreement dated November 14, 2011 to the Credit Agreement dated August 29, 2011 among Weingarten Realty Investors, the Lenders Party Hereto and The Bank of Nova Scotia, as Administrative Agent. Agent (filed as Exhibit 10.71 to WRI’s Annual Report on Form 10-K for the year ended December 31, 2011 and incorporated herein by reference). | 10.72*
10.46 | — | —
| | Guaranty dated November 14, 2011 associated with Credit Agreement among Weingarten Realty Investors, the Lenders Party Hereto and The Bank of Nova Scotia, as Administrative Agent, dated August 29, 2011. 2011 (filed as Exhibit 10.72 to WRI’s Annual Report on Form 10-K for the year ended December 31, 2011 and incorporated herein by reference). | 12.1*
10.47 | — | —
Third Amendment to Promissory Note with Reliance Trust Company, Trustee of the Master Nonqualified Plan Trust under the Weingarten Realty Investors Supplemental Executive Retirement Plan and Weingarten Realty Investors Retirement Benefit Restoration Plan dated February 15, 2012 (filed as Exhibit 10.1 to WRI's Form 10-Q for the quarter ended March 31, 2012 and incorporated herein by reference). | | 10.48† | — | Fourth Amendment to the Weingarten Realty Retirement Plan dated March 2, 2012 (filed as Exhibit 10.2 to WRI's Form 10-Q for the quarter ended March 31, 2012 and incorporated herein by reference). | | 10.49 | — | Purchase and Sale Agreement dated April 10, 2012 (filed as Exhibit 10.1 to WRI's Form 8-K on April 12, 2012 and incorporated herein by reference). | | 10.50† | — | Amendment No. 4 to the Weingarten Realty Investors Retirement Benefit Restoration Plan dated August 10, 2012 (filed as Exhibit 10.1 to WRI's Form 10-Q for the quarter ended September 30, 2012 and incorporated herein by reference). | | 10.51† | — | Amendment No. 5 to the Weingarten Realty Investors Supplemental Executive Retirement Plan dated August 10, 2012 (filed as Exhibit 10.2 to WRI's Form 10-Q for the quarter ended September 30, 2012 and incorporated herein by reference). | | 10.52 | — | Assignment and Assumption dated September 6, 2012 of the Amended and Restated Credit Agreement dated September 30, 2011 (filed as Exhibit 10.3 to WRI's Form 10-Q for the quarter ended September 30, 2012 and incorporated herein by reference). | | 10.53† | — | Master Nonqualified Plan Trust Agreement dated August 23, 2006 (filed as Exhibit 10.53 to WRI's Annual Report on Form 10-K for the year ended December 31, 2012 and incorporated herein by reference). | | 10.54† | — | Restatement of the Weingarten Realty Retirement Plan dated November 17, 2008 (filed as Exhibit 10.54 to WRI's Annual Report on Form 10-K for the year ended December 31, 2012 and incorporated herein by reference). | | 10.55 | — | Amendment Agreement dated April 18, 2013 of the Amended and Restated Credit Agreement dated September 30, 2011 (filed as Exhibit 10.1 to WRI's Form 10-Q for the quarter ended March 31, 2013 and incorporated herein by reference). | | 10.56 | — | Fourth Amendment to Promissory Note with Reliance Trust Company, Trustee of the Master Nonqualified Plan Trust under the Weingarten Realty Investors Supplemental Executive Retirement Plan and Weingarten Realty Investors Retirement Benefit Restoration Plan dated March 11, 2013(filed as Exhibit 10.2 to WRI's Form 10-Q for the quarter ended March 31, 2013 and incorporated herein by reference). | | 10.57† | — | Restatement of the Weingarten Realty Investors Retirement Plan dated December 23, 2013 (filed as Exhibit 10.57 to WRI's Annual Report on Form 10-K for the year ended December 31, 2013 and incorporated herein by reference). | | 10.58 | — | Fifth Amendment to Promissory Note with Reliance Trust Company, Trustee of the Master Nonqualified Plan Trust under the Weingarten Realty Investors Supplemental Executive Retirement Plan and Weingarten Realty Investors Retirement Benefit Restoration Plan dated March 11, 2014(filed as Exhibit 10.1 to WRI's Form 10-Q for the quarter ended March 31, 2014 and incorporated herein by reference). | | 10.59†* | — | First Amendment to Weingarten Realty Investors Retirement Plan dated December 16, 2014. | | 12.1* | — | Computation of Ratios of Earnings to Combined Fixed Charges and Preferred Dividends.Ratios. | 21.1* | — | —
| | Listing of Subsidiaries of the Registrant. |
| 23.1*
| | —
| | 23.1* | — | Consent of Deloitte & Touche LLP. | 31.1* | — | —
| | Certification pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002 (Chief Executive Officer). | 31.2* | — | —
| | Certification pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002 (Chief Financial Officer). | 32.1** | — | —
| | Certification pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002 (Chief Executive Officer). | 32.2** | — | —
| | Certification pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002 (Chief Financial Officer). | 101.INS** | — | —
| | XBRL Instance Document | 101.SCH** | — | —
| | XBRL Taxonomy Extension Schema Document | 101.CAL** | — | —
| | XBRL Taxonomy Extension Calculation Linkbase Document | 101.DEF** | — | —
| | XBRL Taxonomy Extension Definition Linkbase Document | 101.LAB** | — | —
| | XBRL Taxonomy Extension Labels Linkbase Document | 101.PRE** | — | —
| | XBRL Taxonomy Extension Presentation Linkbase Document |
| ** | Furnished with this report. |
| † | Management contract or compensation plan or arrangement. |
Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, the Registrantregistrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. | | | | | WEINGARTEN REALTY INVESTORS | | | By:
| | /s/
| | By: | /s/ Andrew M. Alexander | | | Andrew M. Alexander | | | Chief Executive Officer |
Date: February 29, 201219, 2015 KNOW ALL MEN BY THESE PRESENTS that each of Weingarten Realty Investors, a real estate investment trust organized under the Texas Business Organizations Code, and the undersigned trust managers and officers of Weingarten Realty Investors hereby constitute and appoint Andrew M. Alexander, Stanford Alexander, Stephen C. Richter and Joe D. Shafer or any one of them, its or his true and lawful attorney-in-fact and agent, for it or him and in its or his name, place and stead, in any and all capacities, with full power to act alone, to sign any and all amendments to this Report,report, and to file each such amendment to the Report,report, with all exhibits thereto, and any and all other documents in connection therewith, with the Securities and Exchange Commission, hereby granting unto said attorney-in-fact and agent full power and authority to do and perform any and all acts and things requisite and necessary to be done in and about the premises as fully to all intents and purposes as it or he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirement of the Securities and Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrantregistrant and in the capacities and on the dates indicated: | | | | | | | | | Signature
| | Title
| | Date
| | | | | By:
| | /s/ Stanford Alexander
Stanford Alexander
| | Chairman
and Trust Manager
| | February 29, 2012 | | | | | By:
| | /s/ Andrew M. Alexander
Andrew M. Alexander
| | Chief Executive Officer,
President and Trust Manager
| | February 29, 2012 | | | | | By:
| | /s/ James W. Crownover
James W. Crownover
| | Trust Manager | | February 29, 2012 | | | | | By:
| | /s/ Robert J. Cruikshank
Robert J. Cruikshank
| | Trust Manager | | February 29, 2012 | | | | | By:
| | /s/ Melvin Dow
Melvin Dow
| | Trust Manager | | February 29, 2012 | | | | | By:
| | /s/ Stephen A. Lasher
Stephen A. Lasher
| | Trust Manager | | February 29, 2012 | | | | | By:
| | /s/ Stephen C. Richter
Stephen C. Richter
| | Executive Vice President and
Chief Financial Officer
| | February 29, 2012 |
| | | | | | | | | | | By:
| Signature | Title | Date | | | | | | By: | /s/ Andrew M. Alexander | Chief Executive Officer, President and Trust Manager | February 19, 2015 | | Andrew M. Alexander | | | | | | By: | /s/ Stanford Alexander | Chairman and Trust Manager | February 19, 2015 | | Stanford Alexander | | | | | | By: | /s/ Shelaghmichael Brown | Trust Manager | February 19, 2015 | | Shelaghmichael Brown | | | | | | By: | /s/ James W. Crownover | Trust Manager | February 19, 2015 | | James W. Crownover | | | | | | By: | /s/ Robert J. Cruikshank | Trust Manager | February 19, 2015 | | Robert J. Cruikshank | | | | | | By: | /s/ Melvin Dow | Trust Manager | February 19, 2015 | | Melvin Dow | | | | | | By: | /s/ Stephen A. Lasher | Trust Manager | February 19, 2015 | | Stephen A. Lasher | | | | | | By: | /s/ Stephen C. Richter | Executive Vice President and Chief Financial Officer | February 19, 2015 | | Stephen C. Richter | | | | | | By: | /s/ Thomas L. Ryan | Trust Manager | February 19, 2015 | | Thomas L. Ryan | | | | | | By: | /s/ Douglas W. Schnitzer Douglas W. Schnitzer
| | Trust Manager | | February 29, 201219, 2015 | | | | Douglas W. Schnitzer | By:
| | | | | By: | /s/ Joe D. Shafer Joe D. Shafer
| | Senior Vice President/Chief Accounting Officer (Principal Accounting Officer) | February 19, 2015 | | Joe D. Shafer | | | February 29, 2012 | | | By: | | | | By:
| | /s/ C. Park Shaper C. Park Shaper
| | Trust Manager | | February 29, 201219, 2015 | | | | C. Park Shaper | By:
| | | | | By: | /s/ Marc J. Shapiro Marc J. Shapiro
| | Trust Manager | February 19, 2015 | | | February 29, 2012Marc J. Shapiro |
WEINGARTEN REALTY INVESTORS VALUATION AND QUALIFYING ACCOUNTS December 31, 2011, 2010,2014, 2013, and 20092012 (Amounts in thousands) | | | | | | | | | | | | | | | | | Description | | Balance at
beginning
of period | | | Charged
to costs
and
expenses | | | Deductions
(1) | | | Balance
at end of
period | | | | | | | 2011 | | | | | | | | | | | | | | | | | Allowance for Doubtful Accounts | | $ | 10,137 | | | $ | 7,563 | | | $ | 6,399 | | | $ | 11,301 | | Tax Valuation Allowance | | | 15,818 | | | | 10,823 | | | | 2,046 | | | | 24,595 | | 2010 | | | | | | | | | | | | | | | | | Allowance for Doubtful Accounts | | $ | 10,380 | | | $ | 6,105 | | | $ | 6,348 | | | $ | 10,137 | | Tax Valuation Allowance | | | 9,605 | | | | 8,570 | | | | 2,357 | | | | 15,818 | | 2009 | | | | | | | | | | | | | | | | | Allowance for Doubtful Accounts | | $ | 12,412 | | | $ | 8,553 | | | $ | 10,585 | | | $ | 10,380 | | Tax Valuation Allowance | | | - | | | | 9,605 | | | | - | | | | 9,605 | |
| | | | | | | | | | | | | | | | | | | Description | | Balance at beginning of period | | Charged to costs and expenses | | Deductions(1) | | Balance at end of period | | 2014 | | | | | | | | | | Allowance for Doubtful Accounts | | $ | 9,386 |
| | $ | 1,914 |
| | $ | 3,620 |
| | $ | 7,680 |
| | Tax Valuation Allowance | | 30,541 |
| | 2,239 |
| | 5,241 |
| | 27,539 |
| | 2013 | | | | | | | | | | Allowance for Doubtful Accounts | | $ | 12,127 |
| | $ | 1,420 |
| | $ | 4,161 |
| | $ | 9,386 |
| | Tax Valuation Allowance | | 28,376 |
| | 2,243 |
| | 78 |
| | 30,541 |
| | 2012 | | | | | | | | | | Allowance for Doubtful Accounts | | $ | 11,301 |
| | $ | 7,157 |
| | $ | 6,331 |
| | $ | 12,127 |
| | Tax Valuation Allowance | | 24,595 |
| | 3,781 |
| | — |
| | 28,376 |
|
___________________ | | | (1) | Write-offs of amounts previously reserved. |
WEINGARTEN REALTY INVESTORS REAL ESTATE AND ACCUMULATED DEPRECIATION (Amounts in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | | | | | Description | | Land | | | Building and
Improvements | | | Cost
Capitalized
Subsequent to
Acquisition | | | Land | | | Building and
Improvements | | | Total (1)(2) | | | Accumulated
Depreciation
(2) | | | Total Costs,
Net of
Accumulated
Depreciation | | | Encumbrances
(3) | | | Date of
Acquisition /
Construction | | | | | | | | | | | | | Shopping Center: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 10-Federal Shopping Center | | $ | 1,791 | | | $ | 7,470 | | | $ | 454 | | | $ | 1,791 | | | $ | 7,924 | | | $ | 9,715 | | | $ | (6,136) | | | $ | 3,579 | | | $ | (8,069) | | | | 03/20/2008 | | 580 Market Place | | | 3,892 | | | | 15,570 | | | | 2,325 | | | | 3,889 | | | | 17,898 | | | | 21,787 | | | | (4,651) | | | | 17,136 | | | | - | | | | 04/02/2001 | | Academy Place | | | 1,537 | | | | 6,168 | | | | 1,177 | | | | 1,532 | | | | 7,350 | | | | 8,882 | | | | (3,087) | | | | 5,795 | | | | - | | | | 10/22/1997 | | Alabama Shepherd Shopping Ctr | | | 637 | | | | 2,026 | | | | 6,075 | | | | 1,062 | | | | 7,676 | | | | 8,738 | | | | (3,404) | | | | 5,334 | | | | - | | | | 04/30/2004 | | Angelina Village | | | 200 | | | | 1,777 | | | | 10,148 | | | | 1,127 | | | | 10,998 | | | | 12,125 | | | | (6,006) | | | | 6,119 | | | | - | | | | 04/30/1991 | | Arcade Square | | | 1,497 | | | | 5,986 | | | | 1,314 | | | | 1,495 | | | | 7,302 | | | | 8,797 | | | | (2,141) | | | | 6,656 | | | | - | | | | 04/02/2001 | | Argyle Village Shopping Center | | | 4,524 | | | | 18,103 | | | | 1,916 | | | | 4,526 | | | | 20,017 | | | | 24,543 | | | | (5,607) | | | | 18,936 | | | | - | | | | 11/30/2001 | | Arrowhead Festival S/C | | | 1,294 | | | | 154 | | | | 2,822 | | | | 1,366 | | | | 2,904 | | | | 4,270 | | | | (1,077) | | | | 3,193 | | | | - | | | | 12/31/2000 | | Avent Ferry Shopping Center | | | 1,952 | | | | 7,814 | | | | 1,125 | | | | 1,952 | | | | 8,939 | | | | 10,891 | | | | (2,711) | | | | 8,180 | | | | (509) | | | | 04/04/2002 | | Ballwin Plaza | | | 2,988 | | | | 12,039 | | | | 2,702 | | | | 3,017 | | | | 14,712 | | | | 17,729 | | | | (4,914) | | | | 12,815 | | | | - | | | | 10/01/1999 | | Bartlett Towne Center | | | 3,479 | | | | 14,210 | | | | 1,002 | | | | 3,443 | | | | 15,248 | | | | 18,691 | | | | (4,697) | | | | 13,994 | | | | (4,257) | | | | 05/15/2001 | | Bashas Valley Plaza | | | 1,414 | | | | 5,818 | | | | 4,192 | | | | 1,422 | | | | 10,002 | | | | 11,424 | | | | (3,556) | | | | 7,868 | | | | - | | | | 12/31/1997 | | Bayshore Plaza | | | 728 | | | | 1,452 | | | | 1,177 | | | | 728 | | | | 2,629 | | | | 3,357 | | | | (2,106) | | | | 1,251 | | | | - | | | | 08/21/1981 | | Bell Plaza | | | 1,322 | | | | 7,151 | | | | 364 | | | | 1,322 | | | | 7,515 | | | | 8,837 | | | | (3,098) | | | | 5,739 | | | | (7,426) | | | | 03/20/2008 | | Bellaire Blvd Shopping Center | | | 124 | | | | 37 | | | | - | | | | 124 | | | | 37 | | | | 161 | | | | (37) | | | | 124 | | | | (1,984) | | | | 11/13/2008 | | Best in the West | | | 13,191 | | | | 77,159 | | | | 3,718 | | | | 13,194 | | | | 80,874 | | | | 94,068 | | | | (14,305) | | | | 79,763 | | | | (34,240) | | | | 04/28/2005 | | Boca Lyons Plaza | | | 3,676 | | | | 14,706 | | | | 427 | | | | 3,651 | | | | 15,158 | | | | 18,809 | | | | (4,014) | | | | 14,795 | | | | - | | | | 08/17/2001 | | Boswell Towne Center | | | 1,488 | | | | - | | | | 1,768 | | | | 615 | | | | 2,641 | | | | 3,256 | | | | (1,295) | | | | 1,961 | | | | - | | | | 12/31/2003 | | Boulevard Market Place | | | 340 | | | | 1,430 | | | | 548 | | | | 340 | | | | 1,978 | | | | 2,318 | | | | (1,114) | | | | 1,204 | | | | - | | | | 09/01/1990 | | Braeswood Square Shopping Ctr. | | | - | | | | 1,421 | | | | 1,185 | | | | - | | | | 2,606 | | | | 2,606 | | | | (2,212) | | | | 394 | | | | - | | | | 05/28/1969 | | Broadway & Ellsworth | | | 152 | | | | - | | | | 1,224 | | | | 356 | | | | 1,020 | | | | 1,376 | | | | (434) | | | | 942 | | | | - | | | | 12/31/2002 | | Broadway Marketplace | | | 898 | | | | 3,637 | | | | 917 | | | | 906 | | | | 4,546 | | | | 5,452 | | | | (2,266) | | | | 3,186 | | | | - | | | | 12/16/1993 | | Broadway Shopping Center | | | 234 | | | | 3,166 | | | | 565 | | | | 235 | | | | 3,730 | | | | 3,965 | | | | (2,404) | | | | 1,561 | | | | (2,912) | | | | 03/20/2008 | | Brookwood Marketplace | | | 7,050 | | | | 15,134 | | | | 6,994 | | | | 7,511 | | | | 21,667 | | | | 29,178 | | | | (2,824) | | | | 26,354 | | | | (18,927) | | | | 08/22/2006 | | Brookwood Square Shopping Ctr | | | 4,008 | | | | 19,753 | | | | 1,025 | | | | 4,008 | | | | 20,778 | | | | 24,786 | | | | (4,421) | | | | 20,365 | | | | - | | | | 12/16/2003 | | Brownsville Commons | | | 1,333 | | | | 5,536 | | | | 27 | | | | 1,333 | | | | 5,563 | | | | 6,896 | | | | (805) | | | | 6,091 | | | | - | | | | 05/22/2006 | | Buena Vista Marketplace | | | 1,958 | | | | 7,832 | | | | 780 | | | | 1,956 | | | | 8,614 | | | | 10,570 | | | | (2,492) | | | | 8,078 | | | | - | | | | 04/02/2001 | | Bull City Market | | | 930 | | | | 6,651 | | | | 149 | | | | 930 | | | | 6,800 | | | | 7,730 | | | | (1,104) | | | | 6,626 | | | | - | | | | 06/10/2005 | | Burbank Station | | | 20,366 | | | | 28,832 | | | | (9,664) | | | | 16,003 | | | | 23,531 | | | | 39,534 | | | | (3,141) | | | | 36,393 | | | | - | | | | 07/03/2007 | | Calder Shopping Center | | | 134 | | | | 278 | | | | 367 | | | | 134 | | | | 645 | | | | 779 | | | | (591) | | | | 188 | | | | - | | | | 03/31/1965 | | Camelback Village Square | | | - | | | | 8,720 | | | | 690 | | | | - | | | | 9,410 | | | | 9,410 | | | | (4,139) | | | | 5,271 | | | | - | | | | 09/30/1994 | | Camp Creek Mktpl II | | | 6,169 | | | | 32,036 | | | | 1,256 | | | | 4,697 | | | | 34,764 | | | | 39,461 | | | | (4,833) | | | | 34,628 | | | | (21,483) | | | | 08/22/2006 | | Capital Square | | | 1,852 | | | | 7,406 | | | | 1,410 | | | | 1,852 | | | | 8,816 | | | | 10,668 | | | | (2,478) | | | | 8,190 | | | | - | | | | 04/04/2002 | | Cedar Bayou Shopping Center | | | 63 | | | | 307 | | | | 79 | | | | 63 | | | | 386 | | | | 449 | | | | (366) | | | | 83 | | | | - | | | | 09/20/1977 | | Centerwood Plaza | | | 915 | | | | 3,659 | | | | 1,993 | | | | 914 | | | | 5,653 | | | | 6,567 | | | | (1,398) | | | | 5,169 | | | | - | | | | 04/02/2001 | | Central Plaza | | | 1,710 | | | | 6,900 | | | | 2,708 | | | | 1,710 | | | | 9,608 | | | | 11,318 | | | | (3,912) | | | | 7,406 | | | | - | | | | 03/03/1998 | | Centre at Post Oak | | | 13,731 | | | | 115 | | | | 23,233 | | | | 17,874 | | | | 19,205 | | | | 37,079 | | | | (11,285) | | | | 25,794 | | | | - | | | | 12/31/1996 | | Champions Village | | | 7,205 | | | | 36,579 | | | | 1,064 | | | | 7,205 | | | | 37,643 | | | | 44,848 | | | | (13,672) | | | | 31,176 | | | | (33,391) | | | | 11/13/2008 | | Charleston Commons SC | | | 23,230 | | | | 36,877 | | | | 1,374 | | | | 23,210 | | | | 38,271 | | | | 61,481 | | | | (5,090) | | | | 56,391 | | | | (29,759) | | | | 12/20/2006 | | Cherokee Plaza | | | 22,219 | | | | 9,718 | | | | 7 | | | | 22,219 | | | | 9,725 | | | | 31,944 | | | | (1,424) | | | | 30,520 | | | | (15,071) | | | | 11/13/2008 | | Cherry Creek Retail Center | | | 5,416 | | | | 14,624 | | | | - | | | | 5,416 | | | | 14,624 | | | | 20,040 | | | | (330) | | | | 19,710 | | | | - | | | | 06/16/2011 | | Chino Hills Marketplace | | | 7,218 | | | | 28,872 | | | | 10,109 | | | | 7,234 | | | | 38,965 | | | | 46,199 | | | | (11,537) | | | | 34,662 | | | | - | | | | 08/20/2002 | | College Park Shopping Center | | | 2,201 | | | | 8,845 | | | | 5,740 | | | | 2,641 | | | | 14,145 | | | | 16,786 | | | | (7,428) | | | | 9,358 | | | | (11,004) | | | | 11/16/1998 | | Colonial Landing | | | - | | | | 16,390 | | | | 12,545 | | | | - | | | | 28,935 | | | | 28,935 | | | | (6,659) | | | | 22,276 | | | | (15,434) | | | | 09/30/2008 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | Description | | Land | | Building and Improvements | | Cost Capitalized Subsequent to Acquisition | | Land | | Building and Improvements | | Total (1) | | Accumulated Depreciation | | Total Costs, Net of Accumulated Depreciation | | Encumbrances (2) | | Date of Acquisition / Construction | | Centers: | | | | | | | | | | | | | | | | | | | | | | 10-Federal Shopping Center | | $ | 1,791 |
| | $ | 7,470 |
| | $ | 1,090 |
| | $ | 1,791 |
| | $ | 8,560 |
| | $ | 10,351 |
| | $ | (7,155 | ) | | $ | 3,196 |
| | $ | (7,233 | ) | | 03/20/2008 | | 1919 North Loop West | | 1,334 |
| | 8,451 |
| | 11,592 |
| | 1,337 |
| | 20,040 |
| | 21,377 |
| | (8,925 | ) | | 12,452 |
| | — |
| | 12/05/2006 | | 580 Market Place | | 3,892 |
| | 15,570 |
| | 3,534 |
| | 3,889 |
| | 19,107 |
| | 22,996 |
| | (6,463 | ) | | 16,533 |
| | (16,048 | ) | | 04/02/2001 | | 8000 Sunset Strip Shopping Center | | 18,320 |
| | 73,431 |
| | 2,334 |
| | 18,320 |
| | 75,765 |
| | 94,085 |
| | (5,469 | ) | | 88,616 |
| | — |
| | 06/27/2012 | | Alabama Shepherd Shopping Center | | 637 |
| | 2,026 |
| | 7,882 |
| | 1,062 |
| | 9,483 |
| | 10,545 |
| | (4,390 | ) | | 6,155 |
| | — |
| | 04/30/2004 | | Argyle Village Shopping Center | | 4,524 |
| | 18,103 |
| | 3,807 |
| | 4,526 |
| | 21,908 |
| | 26,434 |
| | (7,922 | ) | | 18,512 |
| | — |
| | 11/30/2001 | | Arrowhead Festival Shopping Center | | 1,294 |
| | 154 |
| | 3,917 |
| | 1,903 |
| | 3,462 |
| | 5,365 |
| | (1,445 | ) | | 3,920 |
| | — |
| | 12/31/2000 | | Avent Ferry Shopping Center | | 1,952 |
| | 7,814 |
| | 1,191 |
| | 1,952 |
| | 9,005 |
| | 10,957 |
| | (3,576 | ) | | 7,381 |
| | — |
| | 04/04/2002 | | Bartlett Towne Center | | 3,479 |
| | 14,210 |
| | 1,208 |
| | 3,443 |
| | 15,454 |
| | 18,897 |
| | (6,095 | ) | | 12,802 |
| | (784 | ) | | 05/15/2001 | | Bell Plaza | | 1,322 |
| | 7,151 |
| | 637 |
| | 1,322 |
| | 7,788 |
| | 9,110 |
| | (3,852 | ) | | 5,258 |
| | (6,656 | ) | | 03/20/2008 | | Bellaire Blvd. Shopping Center | | 124 |
| | 37 |
| | 3 |
| | 125 |
| | 39 |
| | 164 |
| | (37 | ) | | 127 |
| | — |
| | 11/13/2008 | | Best in the West | | 13,191 |
| | 77,159 |
| | 7,249 |
| | 13,194 |
| | 84,405 |
| | 97,599 |
| | (21,502 | ) | | 76,097 |
| | — |
| | 04/28/2005 | | Blalock Market at I-10 | | — |
| | 4,730 |
| | 2,033 |
| | — |
| | 6,763 |
| | 6,763 |
| | (4,491 | ) | | 2,272 |
| | — |
| | 12/31/1990 | | Boca Lyons Plaza | | 3,676 |
| | 14,706 |
| | 2,855 |
| | 3,651 |
| | 17,586 |
| | 21,237 |
| | (5,645 | ) | | 15,592 |
| | — |
| | 08/17/2001 | | Boswell Towne Center | | 1,488 |
| | — |
| | 1,723 |
| | 615 |
| | 2,596 |
| | 3,211 |
| | (1,395 | ) | | 1,816 |
| | — |
| | 12/31/2003 | | Braeswood Square Shopping Center | | — |
| | 1,421 |
| | 1,197 |
| | — |
| | 2,618 |
| | 2,618 |
| | (2,397 | ) | | 221 |
| | — |
| | 05/28/1969 | | Broadway Marketplace | | 898 |
| | 3,637 |
| | 1,010 |
| | 906 |
| | 4,639 |
| | 5,545 |
| | (2,713 | ) | | 2,832 |
| | — |
| | 12/16/1993 | | Broadway Shopping Center | | 234 |
| | 3,166 |
| | 799 |
| | 235 |
| | 3,964 |
| | 4,199 |
| | (2,621 | ) | | 1,578 |
| | (2,610 | ) | | 03/20/2008 | | Brookwood Marketplace | | 7,050 |
| | 15,134 |
| | 7,239 |
| | 7,511 |
| | 21,912 |
| | 29,423 |
| | (4,686 | ) | | 24,737 |
| | (17,924 | ) | | 08/22/2006 | | Brookwood Square Shopping Center | | 4,008 |
| | 19,753 |
| | (3,131 | ) | | 4,008 |
| | 16,622 |
| | 20,630 |
| | (3,610 | ) | | 17,020 |
| | — |
| | 12/16/2003 | | Brownsville Commons | | 1,333 |
| | 5,536 |
| | 315 |
| | 1,333 |
| | 5,851 |
| | 7,184 |
| | (1,298 | ) | | 5,886 |
| | — |
| | 05/22/2006 | | Buena Vista Marketplace | | 1,958 |
| | 7,832 |
| | 1,189 |
| | 1,956 |
| | 9,023 |
| | 10,979 |
| | (3,277 | ) | | 7,702 |
| | — |
| | 04/02/2001 | | Bull City Market | | 930 |
| | 6,651 |
| | 654 |
| | 930 |
| | 7,305 |
| | 8,235 |
| | (1,715 | ) | | 6,520 |
| | (3,572 | ) | | 06/10/2005 | | Camelback Village Square | | — |
| | 8,720 |
| | 1,267 |
| | — |
| | 9,987 |
| | 9,987 |
| | (5,010 | ) | | 4,977 |
| | — |
| | 09/30/1994 | | Camp Creek Marketplace II | | 6,169 |
| | 32,036 |
| | 1,460 |
| | 4,697 |
| | 34,968 |
| | 39,665 |
| | (7,587 | ) | | 32,078 |
| | (19,833 | ) | | 08/22/2006 | | Capital Square | | 1,852 |
| | 7,406 |
| | 1,410 |
| | 1,852 |
| | 8,816 |
| | 10,668 |
| | (3,551 | ) | | 7,117 |
| | — |
| | 04/04/2002 | | Centerwood Plaza | | 915 |
| | 3,659 |
| | 2,379 |
| | 914 |
| | 6,039 |
| | 6,953 |
| | (2,049 | ) | | 4,904 |
| | — |
| | 04/02/2001 | | Charleston Commons Shopping Center | | 23,230 |
| | 36,877 |
| | 2,186 |
| | 23,210 |
| | 39,083 |
| | 62,293 |
| | (8,366 | ) | | 53,927 |
| | — |
| | 12/20/2006 | | Cherry Creek Retail Center | | 5,416 |
| | 14,624 |
| | — |
| | 5,416 |
| | 14,624 |
| | 20,040 |
| | (2,309 | ) | | 17,731 |
| | — |
| | 06/16/2011 |
Schedule III (Continued)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | | | | | Description | | Land | | | Building and
Improvements | | | Cost
Capitalized
Subsequent to
Acquisition | | | Land | | | Building and
Improvements | | | Total (1)(2) | | | Accumulated
Depreciation
(2) | | | Total Costs,
Net of
Accumulated
Depreciation | | | Encumbrances
(3) | | | Date of
Acquisition /
Construction | | Colonial Plaza | | $ | 10,806 | | | $ | 43,234 | | | $ | 10,198 | | | $ | 10,813 | | | $ | 53,425 | | | $ | 64,238 | | | $ | (15,470) | | | $ | 48,768 | | | $ | - | | | | 02/21/2001 | | Commons at Dexter Lake I | | | 2,923 | | | | 12,007 | | | | 136 | | | | 2,923 | | | | 12,143 | | | | 15,066 | | | | (3,363) | | | | 11,703 | | | | (9,743) | | | | 11/13/2008 | | Commons at Dexter Lake II | | | 2,023 | | | | 6,940 | | | | 92 | | | | 2,023 | | | | 7,032 | | | | 9,055 | | | | (1,119) | | | | 7,936 | | | | (3,591) | | | | 11/13/2008 | | Countryside Centre-Pad | | | 1,616 | | | | 3,432 | | | | 1,011 | | | | 1,616 | | | | 4,443 | | | | 6,059 | | | | (386) | | | | 5,673 | | | | - | | | | 07/06/2007 | | Countryside Centre | | | 13,908 | | | | 26,387 | | | | 3,458 | | | | 13,943 | | | | 29,810 | | | | 43,753 | | | | (3,135) | | | | 40,618 | | | | (25,726) | | | | 07/06/2007 | | Creekside Center | | | 1,732 | | | | 6,929 | | | | 1,786 | | | | 1,730 | | | | 8,717 | | | | 10,447 | | | | (2,423) | | | | 8,024 | | | | (8,025) | | | | 04/02/2001 | | Crossroads Shopping Center | | | - | | | | 2,083 | | | | 1,486 | | | | - | | | | 3,569 | | | | 3,569 | | | | (3,341) | | | | 228 | | | | - | | | | 05/11/1972 | | Cullen Place | | | - | | | | - | | | | 272 | | | | - | | | | 272 | | | | 272 | | | | (186) | | | | 86 | | | | - | | | | 02/17/1966 | | Cullen Plaza Shopping Center | | | 106 | | | | 2,841 | | | | 544 | | | | 106 | | | | 3,385 | | | | 3,491 | | | | (2,578) | | | | 913 | | | | (6,680) | | | | 03/20/2008 | | Custer Park Shopping Center | | | 503 | | | | 2,005 | | | | 8,589 | | | | 2,017 | | | | 9,080 | | | | 11,097 | | | | (4,200) | | | | 6,897 | | | | - | | | | 03/31/2000 | | Cypress Pointe | | | 3,468 | | | | 8,700 | | | | 805 | | | | 3,468 | | | | 9,505 | | | | 12,973 | | | | (4,819) | | | | 8,154 | | | | - | | | | 04/04/2002 | | Cypress Station Square | | | 3,736 | | | | 8,374 | | | | 883 | | | | 2,389 | | | | 10,604 | | | | 12,993 | | | | (8,698) | | | | 4,295 | | | | - | | | | 12/06/1972 | | Dallas Commons Shopping Center | | | 1,582 | | | | 4,969 | | | | 49 | | | | 1,582 | | | | 5,018 | | | | 6,600 | | | | (685) | | | | 5,915 | | | | - | | | | 09/14/2006 | | Danville Plaza Shopping Center | | | - | | | | 3,360 | | | | 1,878 | | | | - | | | | 5,238 | | | | 5,238 | | | | (4,917) | | | | 321 | | | | - | | | | 09/30/1960 | | Desert Village Shopping Center | | | 3,362 | | | | 14,969 | | | | 297 | | | | 3,362 | | | | 15,266 | | | | 18,628 | | | | (453) | | | | 18,175 | | | | - | | | | 10/28/2010 | | Discovery Plaza | | | 2,193 | | | | 8,772 | | | | 492 | | | | 2,191 | | | | 9,266 | | | | 11,457 | | | | (2,545) | | | | 8,912 | | | | - | | | | 04/02/2001 | | Eastdale Shopping Center | | | 1,423 | | | | 5,809 | | | | 1,861 | | | | 1,417 | | | | 7,676 | | | | 9,093 | | | | (3,209) | | | | 5,884 | | | | - | | | | 12/31/1997 | | Eastern Horizon | | | 10,282 | | | | 16 | | | | (444) | | | | 1,569 | | | | 8,285 | | | | 9,854 | | | | (4,080) | | | | 5,774 | | | | - | | | | 12/31/2002 | | Eastpark Shopping Center | | | 634 | | | | 3,392 | | | | (3,979) | | | | 47 | | | | - | | | | 47 | | | | - | | | | 47 | | | | - | | | | 12/31/1970 | | Edgebrook Shopping Center | | | 183 | | | | 1,914 | | | | 432 | | | | 183 | | | | 2,346 | | | | 2,529 | | | | (1,699) | | | | 830 | | | | (6,505) | | | | 03/20/2008 | | Edgewater Marketplace | | | 4,821 | | | | 11,225 | | | | 176 | | | | 4,821 | | | | 11,401 | | | | 16,222 | | | | (321) | | | | 15,901 | | | | (17,600) | | | | 11/19/2010 | | El Camino Shopping Center | | | 4,431 | | | | 20,557 | | | | 4,021 | | | | 4,429 | | | | 24,580 | | | | 29,009 | | | | (4,820) | | | | 24,189 | | | | (11,164) | | | | 05/21/2004 | | Embassy Lakes Shopping Center | | | 2,803 | | | | 11,268 | | | | 399 | | | | 2,803 | | | | 11,667 | | | | 14,470 | | | | (2,693) | | | | 11,777 | | | | - | | | | 12/18/2002 | | Entrada de Oro Plaza SC | | | 6,041 | | | | 10,511 | | | | 1,470 | | | | 6,115 | | | | 11,907 | | | | 18,022 | | | | (1,668) | | | | 16,354 | | | | - | | | | 01/22/2007 | | Epic Village St. Augustine | | | 283 | | | | 1,171 | | | | 3,889 | | | | 320 | | | | 5,023 | | | | 5,343 | | | | (862) | | | | 4,481 | | | | - | | | | 09/30/2009 | | Falls Pointe Shopping Center | | | 3,535 | | | | 14,289 | | | | 234 | | | | 3,522 | | | | 14,536 | | | | 18,058 | | | | (3,498) | | | | 14,560 | | | | (10,414) | | | | 12/17/2002 | | Festival on Jefferson Court | | | 5,041 | | | | 13,983 | | | | 2,392 | | | | 5,022 | | | | 16,394 | | | | 21,416 | | | | (3,361) | | | | 18,055 | | | | - | | | | 12/22/2004 | | Fiesta Center | | | - | | | | 4,730 | | | | 1,930 | | | | - | | | | 6,660 | | | | 6,660 | | | | (3,643) | | | | 3,017 | | | | - | | | | 12/31/1990 | | Fiesta Market Place | | | 137 | | | | 429 | | | | 8 | | | | 137 | | | | 437 | | | | 574 | | | | (429) | | | | 145 | | | | (1,700) | | | | 03/20/2008 | | Fiesta Trails | | | 8,825 | | | | 32,790 | | | | 2,723 | | | | 8,825 | | | | 35,513 | | | | 44,338 | | | | (8,149) | | | | 36,189 | | | | (22,506) | | | | 09/30/2003 | | Flamingo Pines Shopping Center | | | 10,403 | | | | 35,014 | | | | (17,129) | | | | 5,335 | | | | 22,953 | | | | 28,288 | | | | (3,860) | | | | 24,428 | | | | - | | | | 01/28/2005 | | Fountain Plaza | | | 1,319 | | | | 5,276 | | | | 757 | | | | 1,095 | | | | 6,257 | | | | 7,352 | | | | (2,961) | | | | 4,391 | | | | - | | | | 03/10/1994 | | Francisco Center | | | 1,999 | | | | 7,997 | | | | 4,005 | | | | 2,403 | | | | 11,598 | | | | 14,001 | | | | (6,447) | | | | 7,554 | | | | (9,996) | | | | 11/16/1998 | | Freedom Centre | | | 2,929 | | | | 15,302 | | | | 4,774 | | | | 6,944 | | | | 16,061 | | | | 23,005 | | | | (2,702) | | | | 20,303 | | | | (1,548) | | | | 06/23/2006 | | Galleria Shopping Center | | | 10,795 | | | | 10,339 | | | | 8,206 | | | | 10,805 | | | | 18,535 | | | | 29,340 | | | | (2,371) | | | | 26,969 | | | | (19,442) | | | | 12/11/2006 | | Galveston Place | | | 2,713 | | | | 5,522 | | | | 6,023 | | | | 3,279 | | | | 10,979 | | | | 14,258 | | | | (7,561) | | | | 6,697 | | | | (1,594) | | | | 11/30/1983 | | Gateway Plaza | | | 4,812 | | | | 19,249 | | | | 2,240 | | | | 4,808 | | | | 21,493 | | | | 26,301 | | | | (5,971) | | | | 20,330 | | | | (23,128) | | | | 04/02/2001 | | Gateway Station | | | 1,622 | | | | 3 | | | | 8,880 | | | | 1,921 | | | | 8,584 | | | | 10,505 | | | | (1,363) | | | | 9,142 | | | | - | | | | 09/30/2009 | | Glenbrook Square Shopping Ctr | | | 632 | | | | 3,576 | | | | 555 | | | | 632 | | | | 4,131 | | | | 4,763 | | | | (1,786) | | | | 2,977 | | | | (5,640) | | | | 03/20/2008 | | Grayson Commons | | | 3,180 | | | | 9,023 | | | | 81 | | | | 3,163 | | | | 9,121 | | | | 12,284 | | | | (1,658) | | | | 10,626 | | | | (6,338) | | | | 11/09/2004 | | Greenhouse Marketplace | | | 992 | | | | 4,901 | | | | 353 | | | | 992 | | | | 5,254 | | | | 6,246 | | | | (1,103) | | | | 5,143 | | | | - | | | | 01/28/2004 | | Greenhouse Marketplace | | | 3,615 | | | | 17,870 | | | | 1,161 | | | | 3,721 | | | | 18,925 | | | | 22,646 | | | | (4,024) | | | | 18,622 | | | | - | | | | 01/28/2004 | | Griggs Road Shopping Center | | | 257 | | | | 2,303 | | | | 133 | | | | 257 | | | | 2,436 | | | | 2,693 | | | | (2,186) | | | | 507 | | | | (4,333) | | | | 03/20/2008 | | Hallmark Town Center | | | 1,368 | | | | 5,472 | | | | 975 | | | | 1,367 | | | | 6,448 | | | | 7,815 | | | | (1,967) | | | | 5,848 | | | | - | | | | 04/02/2001 | | Harrisburg Plaza | | | 1,278 | | | | 3,924 | | | | 747 | | | | 1,278 | | | | 4,671 | | | | 5,949 | | | | (3,826) | | | | 2,123 | | | | (11,622) | | | | 03/20/2008 | | Harrison Pointe Center | | | 8,230 | | | | 13,493 | | | | 157 | | | | 7,153 | | | | 14,727 | | | | 21,880 | | | | (3,310) | | | | 18,570 | | | | - | | | | 01/30/2004 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | Description | | Land | | Building and Improvements | | Cost Capitalized Subsequent to Acquisition | | Land | | Building and Improvements | | Total (1) | | Accumulated Depreciation | | Total Costs, Net of Accumulated Depreciation | | Encumbrances (2) | | Date of Acquisition / Construction | | Chino Hills Marketplace | | $ | 7,218 |
| | $ | 28,872 |
| | $ | 11,424 |
| | $ | 7,234 |
| | $ | 40,280 |
| | $ | 47,514 |
| | $ | (16,385 | ) | | $ | 31,129 |
| | $ | — |
| | 08/20/2002 | | Citadel Building | | 3,236 |
| | 6,168 |
| | 7,980 |
| | 534 |
| | 16,850 |
| | 17,384 |
| | (14,180 | ) | | 3,204 |
| | — |
| | 12/30/1975 | | College Park Shopping Center | | 2,201 |
| | 8,845 |
| | 7,137 |
| | 2,641 |
| | 15,542 |
| | 18,183 |
| | (9,670 | ) | | 8,513 |
| | (11,004 | ) | | 11/16/1998 | | Colonial Plaza | | 10,806 |
| | 43,234 |
| | 13,365 |
| | 10,813 |
| | 56,592 |
| | 67,405 |
| | (22,277 | ) | | 45,128 |
| | — |
| | 02/21/2001 | | Countryside Centre | | 15,523 |
| | 29,818 |
| | 8,868 |
| | 15,559 |
| | 38,650 |
| | 54,209 |
| | (7,992 | ) | | 46,217 |
| | — |
| | 07/06/2007 | | Creekside Center | | 1,732 |
| | 6,929 |
| | 1,991 |
| | 1,730 |
| | 8,922 |
| | 10,652 |
| | (3,569 | ) | | 7,083 |
| | (7,728 | ) | | 04/02/2001 | | Cullen Plaza Shopping Center | | 106 |
| | 2,841 |
| | 452 |
| | 106 |
| | 3,293 |
| | 3,399 |
| | (2,639 | ) | | 760 |
| | (5,987 | ) | | 03/20/2008 | | Cypress Pointe | | 3,468 |
| | 8,700 |
| | 1,381 |
| | 3,793 |
| | 9,756 |
| | 13,549 |
| | (5,809 | ) | | 7,740 |
| | — |
| | 04/04/2002 | | Dallas Commons Shopping Center | | 1,582 |
| | 4,969 |
| | 94 |
| | 1,582 |
| | 5,063 |
| | 6,645 |
| | (1,092 | ) | | 5,553 |
| | — |
| | 09/14/2006 | | Danville Plaza Shopping Center | | — |
| | 3,360 |
| | 2,322 |
| | — |
| | 5,682 |
| | 5,682 |
| | (5,006 | ) | | 676 |
| | — |
| | 09/30/1960 | | DDS Office Building | | 959 |
| | 3,141 |
| | — |
| | 959 |
| | 3,141 |
| | 4,100 |
| | (181 | ) | | 3,919 |
| | — |
| | 10/07/2013 | | Desert Village Shopping Center | | 3,362 |
| | 14,969 |
| | 1,167 |
| | 3,362 |
| | 16,136 |
| | 19,498 |
| | (1,839 | ) | | 17,659 |
| | — |
| | 10/28/2010 | | Discovery Plaza | | 2,193 |
| | 8,772 |
| | 1,091 |
| | 2,191 |
| | 9,865 |
| | 12,056 |
| | (3,444 | ) | | 8,612 |
| | — |
| | 04/02/2001 | | Eastdale Shopping Center | | 1,423 |
| | 5,809 |
| | 1,958 |
| | 1,417 |
| | 7,773 |
| | 9,190 |
| | (3,985 | ) | | 5,205 |
| | — |
| | 12/31/1997 | | Eastern Horizon | | 10,282 |
| | 16 |
| | (279 | ) | | 1,569 |
| | 8,450 |
| | 10,019 |
| | (4,669 | ) | | 5,350 |
| | — |
| | 12/31/2002 | | Edgewater Marketplace | | 4,821 |
| | 11,225 |
| | 395 |
| | 4,821 |
| | 11,620 |
| | 16,441 |
| | (1,403 | ) | | 15,038 |
| | (17,600 | ) | | 11/19/2010 | | El Camino Promenade | | 4,431 |
| | 20,557 |
| | 4,217 |
| | 4,429 |
| | 24,776 |
| | 29,205 |
| | (7,648 | ) | | 21,557 |
| | — |
| | 05/21/2004 | | Embassy Lakes Shopping Center | | 2,803 |
| | 11,268 |
| | 845 |
| | 2,803 |
| | 12,113 |
| | 14,916 |
| | (3,755 | ) | | 11,161 |
| | — |
| | 12/18/2002 | | Entrada de Oro Plaza Shopping Center | | 6,041 |
| | 10,511 |
| | 1,693 |
| | 6,115 |
| | 12,130 |
| | 18,245 |
| | (3,170 | ) | | 15,075 |
| | — |
| | 01/22/2007 | | Epic Village St. Augustine | | 283 |
| | 1,171 |
| | 4,065 |
| | 320 |
| | 5,199 |
| | 5,519 |
| | (2,260 | ) | | 3,259 |
| | — |
| | 09/30/2009 | | Falls Pointe Shopping Center | | 3,535 |
| | 14,289 |
| | 407 |
| | 3,522 |
| | 14,709 |
| | 18,231 |
| | (4,628 | ) | | 13,603 |
| | — |
| | 12/17/2002 | | Festival on Jefferson Court | | 5,041 |
| | 13,983 |
| | 2,791 |
| | 5,022 |
| | 16,793 |
| | 21,815 |
| | (5,191 | ) | | 16,624 |
| | — |
| | 12/22/2004 | | Fiesta Market Place | | 137 |
| | 429 |
| | 8 |
| | 137 |
| | 437 |
| | 574 |
| | (431 | ) | | 143 |
| | (1,524 | ) | | 03/20/2008 | | Fiesta Trails | | 8,825 |
| | 32,790 |
| | 2,909 |
| | 8,825 |
| | 35,699 |
| | 44,524 |
| | (11,598 | ) | | 32,926 |
| | — |
| | 09/30/2003 | | Flamingo Pines Plaza | | 10,403 |
| | 35,014 |
| | (14,214 | ) | | 5,335 |
| | 25,868 |
| | 31,203 |
| | (6,099 | ) | | 25,104 |
| | — |
| | 01/28/2005 | | Fountain Plaza | | 1,319 |
| | 5,276 |
| | 1,424 |
| | 1,095 |
| | 6,924 |
| | 8,019 |
| | (3,651 | ) | | 4,368 |
| | — |
| | 03/10/1994 | | Francisco Center | | 1,999 |
| | 7,997 |
| | 4,525 |
| | 2,403 |
| | 12,118 |
| | 14,521 |
| | (7,957 | ) | | 6,564 |
| | (9,996 | ) | | 11/16/1998 | | Freedom Centre | | 2,929 |
| | 15,302 |
| | 5,568 |
| | 6,944 |
| | 16,855 |
| | 23,799 |
| | (4,632 | ) | | 19,167 |
| | (717 | ) | | 06/23/2006 | | Galleria Shopping Center | | 10,795 |
| | 10,339 |
| | 8,487 |
| | 10,805 |
| | 18,816 |
| | 29,621 |
| | (3,925 | ) | | 25,696 |
| | (18,200 | ) | | 12/11/2006 | | Galveston Place | | 2,713 |
| | 5,522 |
| | 5,994 |
| | 3,279 |
| | 10,950 |
| | 14,229 |
| | (8,418 | ) | | 5,811 |
| | — |
| | 11/30/1983 | | Gateway Plaza | | 4,812 |
| | 19,249 |
| | 4,056 |
| | 4,808 |
| | 23,309 |
| | 28,117 |
| | (8,099 | ) | | 20,018 |
| | (21,787 | ) | | 04/02/2001 | | Gateway Station | | 1,622 |
| | 3 |
| | 9,401 |
| | 1,921 |
| | 9,105 |
| | 11,026 |
| | (3,082 | ) | | 7,944 |
| | — |
| | 09/30/2009 | | Glenbrook Square Shopping Center | | 632 |
| | 3,576 |
| | 709 |
| | 632 |
| | 4,285 |
| | 4,917 |
| | (2,221 | ) | | 2,696 |
| | (5,056 | ) | | 03/20/2008 | | Grayson Commons | | 3,180 |
| | 9,023 |
| | 217 |
| | 3,163 |
| | 9,257 |
| | 12,420 |
| | (2,426 | ) | | 9,994 |
| | (5,565 | ) | | 11/09/2004 | | Greenhouse Marketplace | | 4,607 |
| | 22,771 |
| | 3,435 |
| | 4,750 |
| | 26,063 |
| | 30,813 |
| | (7,656 | ) | | 23,157 |
| | — |
| | 01/28/2004 |
Schedule III (Continued)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | | | | | Description | | Land | | | Building and
Improvements | | | Cost
Capitalized
Subsequent to
Acquisition | | | Land | | | Building and
Improvements | | | Total (1)(2) | | | Accumulated
Depreciation
(2) | | | Total Costs,
Net of
Accumulated
Depreciation | | | Encumbrances
(3) | | | Date of
Acquisition /
Construction | | Heights Plaza Shopping Center | | $ | 58 | | | $ | 699 | | | $ | 1,907 | | | $ | 928 | | | $ | 1,736 | | | $ | 2,664 | | | $ | (1,155) | | | $ | 1,509 | | | $ | - | | | | 06/30/1995 | | Heritage Station | | | 6,253 | | | | 3,989 | | | | (265) | | | | 6,139 | | | | 3,838 | | | | 9,977 | | | | (889) | | | | 9,088 | | | | (5,770) | | | | 12/15/2006 | | High House Crossing | | | 2,576 | | | | 10,305 | | | | 407 | | | | 2,576 | | | | 10,712 | | | | 13,288 | | | | (2,762) | | | | 10,526 | | | | - | | | | 04/04/2002 | | Highland Square | | | - | | | | - | | | | 1,887 | | | | - | | | | 1,887 | | | | 1,887 | | | | (333) | | | | 1,554 | | | | - | | | | 10/06/1959 | | Hope Valley Commons | | | 2,439 | | | | 8,487 | | | | 160 | | | | 2,439 | | | | 8,647 | | | | 11,086 | | | | (305) | | | | 10,781 | | | | - | | | | 08/31/2010 | | Horne Street Market | | | 4,239 | | | | 37 | | | | 7,350 | | | | 4,446 | | | | 7,180 | | | | 11,626 | | | | (1,050) | | | | 10,576 | | | | - | | | | 06/30/2009 | | Humblewood Shopping Center | | | 2,215 | | | | 4,724 | | | | 3,095 | | | | 1,166 | | | | 8,868 | | | | 10,034 | | | | (7,940) | | | | 2,094 | | | | (13,193) | | | | 03/09/1977 | | I45/Telephone Rd. | | | 678 | | | | 11,182 | | | | 649 | | | | 678 | | | | 11,831 | | | | 12,509 | | | | (4,773) | | | | 7,736 | | | | (14,233) | | | | 03/20/2008 | | Independence Plaza | | | 2,006 | | | | 8,318 | | | | 3,851 | | | | 1,995 | | | | 12,180 | | | | 14,175 | | | | (4,486) | | | | 9,689 | | | | - | | | | 12/31/1997 | | Johnston Road Plaza | | | 3,671 | | | | 11,829 | | | | (1,838) | | | | 3,206 | | | | 10,456 | | | | 13,662 | | | | (1,980) | | | | 11,682 | | | | (9,409) | | | | 06/10/2005 | | Killeen Marketplace | | | 2,262 | | | | 9,048 | | | | 491 | | | | 2,275 | | | | 9,526 | | | | 11,801 | | | | (2,722) | | | | 9,079 | | | | - | | | | 12/21/2000 | | Kohl’s Shopping Center | | | 2,298 | | | | 9,193 | | | | 642 | | | | 2,298 | | | | 9,835 | | | | 12,133 | | | | (2,808) | | | | 9,325 | | | | - | | | | 04/24/2000 | | Kroger/Fondren Square | | | 1,383 | | | | 2,810 | | | | 735 | | | | 1,387 | | | | 3,541 | | | | 4,928 | | | | (3,276) | | | | 1,652 | | | | - | | | | 09/30/1985 | | Lake Pointe Market | | | 1,404 | | | | - | | | | 4,132 | | | | 1,960 | | | | 3,576 | | | | 5,536 | | | | (2,053) | | | | 3,483 | | | | - | | | | 12/31/2004 | | Lake Washington Square | | | 1,232 | | | | 4,928 | | | | 849 | | | | 1,235 | | | | 5,774 | | | | 7,009 | | | | (1,488) | | | | 5,521 | | | | - | | | | 06/28/2002 | | Lakeside Marketplace | | | 6,064 | | | | 22,989 | | | | 2,963 | | | | 6,150 | | | | 25,866 | | | | 32,016 | | | | (3,841) | | | | 28,175 | | | | (17,752) | | | | 08/22/2006 | | Largo Mall | | | 10,817 | | | | 40,906 | | | | 2,197 | | | | 10,810 | | | | 43,110 | | | | 53,920 | | | | (8,773) | | | | 45,147 | | | | - | | | | 03/01/2004 | | Laveen Village Marketplace | | | 1,190 | | | | - | | | | 4,725 | | | | 1,006 | | | | 4,909 | | | | 5,915 | | | | (2,097) | | | | 3,818 | | | | - | | | | 08/15/2003 | | Lawndale Shopping Center | | | 82 | | | | 927 | | | | 447 | | | | 82 | | | | 1,374 | | | | 1,456 | | | | (1,068) | | | | 388 | | | | (4,056) | | | | 03/20/2008 | | League City Plaza | | | 1,918 | | | | 7,592 | | | | 836 | | | | 1,918 | | | | 8,428 | | | | 10,346 | | | | (3,851) | | | | 6,495 | | | | (11,251) | | | | 03/20/2008 | | Leesville Towne Centre | | | 7,183 | | | | 17,162 | | | | 875 | | | | 7,183 | | | | 18,037 | | | | 25,220 | | | | (3,629) | | | | 21,591 | | | | - | | | | 01/30/2004 | | Little York Plaza Shopping Ctr | | | 342 | | | | 5,170 | | | | 1,289 | | | | 342 | | | | 6,459 | | | | 6,801 | | | | (4,782) | | | | 2,019 | | | | (4,905) | | | | 03/20/2008 | | Lyons Avenue Shopping Center | | | 249 | | | | 1,183 | | | | 34 | | | | 249 | | | | 1,217 | | | | 1,466 | | | | (1,026) | | | | 440 | | | | (2,950) | | | | 03/20/2008 | | Madera Village Shopping Center | | | 3,788 | | | | 13,507 | | | | 931 | | | | 3,816 | | | | 14,410 | | | | 18,226 | | | | (1,963) | | | | 16,263 | | | | (9,309) | | | | 03/13/2007 | | Manhattan Plaza | | | 4,645 | | | | - | | | | 18,335 | | | | 4,009 | | | | 18,971 | | | | 22,980 | | | | (7,722) | | | | 15,258 | | | | - | | | | 12/31/2004 | | Market at Southside | | | 953 | | | | 3,813 | | | | 1,060 | | | | 958 | | | | 4,868 | | | | 5,826 | | | | (1,651) | | | | 4,175 | | | | - | | | | 08/28/2000 | | Market at Town Center | | | 8,600 | | | | 26,627 | | | | 21,580 | | | | 8,600 | | | | 48,207 | | | | 56,807 | | | | (16,723) | | | | 40,084 | | | | - | | | | 12/23/1996 | | Market at Westchase SC | | | 1,199 | | | | 5,821 | | | | 2,507 | | | | 1,415 | | | | 8,112 | | | | 9,527 | | | | (5,028) | | | | 4,499 | | | | - | | | | 02/15/1991 | | Market Street Shopping Center | | | 424 | | | | 1,271 | | | | 1,416 | | | | 424 | | | | 2,687 | | | | 3,111 | | | | (1,593) | | | | 1,518 | | | | - | | | | 04/26/1978 | | Marketplace at Seminole Towne | | | 15,067 | | | | 53,743 | | | | 4,291 | | | | 21,734 | | | | 51,367 | | | | 73,101 | | | | (6,745) | | | | 66,356 | | | | (42,081) | | | | 08/21/2006 | | Markham Square Shopping Center | | | 1,236 | | | | 3,075 | | | | 3,892 | | | | 1,139 | | | | 7,064 | | | | 8,203 | | | | (4,462) | | | | 3,741 | | | | - | | | | 06/18/1974 | | Markham West Shopping Center | | | 2,694 | | | | 10,777 | | | | 3,931 | | | | 2,696 | | | | 14,706 | | | | 17,402 | | | | (5,809) | | | | 11,593 | | | | - | | | | 09/18/1998 | | Marshall’s Plaza | | | 1,802 | | | | 12,315 | | | | 504 | | | | 1,804 | | | | 12,817 | | | | 14,621 | | | | (2,266) | | | | 12,355 | | | | - | | | | 06/01/2005 | | Mendenhall Commons | | | 2,655 | | | | 9,165 | | | | 427 | | | | 2,655 | | | | 9,592 | | | | 12,247 | | | | (1,443) | | | | 10,804 | | | | (5,797) | | | | 11/13/2008 | | Menifee Town Center | | | 1,827 | | | | 7,307 | | | | 4,647 | | | | 1,824 | | | | 11,957 | | | | 13,781 | | | | (3,079) | | | | 10,702 | | | | - | | | | 04/02/2001 | | Millpond Center | | | 3,155 | | | | 9,706 | | | | 1,458 | | | | 3,161 | | | | 11,158 | | | | 14,319 | | | | (2,159) | | | | 12,160 | | | | - | | | | 07/28/2005 | | Mineral Springs Village | | | 794 | | | | 3,175 | | | | (1,548) | | | | 446 | | | | 1,975 | | | | 2,421 | | | | (929) | | | | 1,492 | | | | - | | | | 04/04/2002 | | Mission Center | | | 1,237 | | | | 4,949 | | | | 6,167 | | | | 2,120 | | | | 10,233 | | | | 12,353 | | | | (4,564) | | | | 7,789 | | | | - | | | | 12/18/1995 | | Mktplace at Seminole Outparcel | | | 1,000 | | | | - | | | | 51 | | | | 1,046 | | | | 5 | | | | 1,051 | | | | - | | | | 1,051 | | | | - | | | | 08/21/2006 | | Mohave Crossroads | | | 3,953 | | | | 63 | | | | 35,474 | | | | 3,128 | | | | 36,362 | | | | 39,490 | | | | (7,704) | | | | 31,786 | | | | - | | | | 12/31/2009 | | Monte Vista Village Center | | | 1,485 | | | | 58 | | | | 4,973 | | | | 755 | | | | 5,761 | | | | 6,516 | | | | (2,758) | | | | 3,758 | | | | - | | | | 12/31/2004 | | Montgomery Plaza Shopping Ctr. | | | 2,500 | | | | 9,961 | | | | 10,083 | | | | 2,830 | | | | 19,714 | | | | 22,544 | | | | (9,707) | | | | 12,837 | | | | - | | | | 06/09/1993 | | Moore Plaza | | | 6,445 | | | | 26,140 | | | | 9,360 | | | | 6,487 | | | | 35,458 | | | | 41,945 | | | | (13,434) | | | | 28,511 | | | | - | | | | 03/20/1998 | | North Creek Plaza | | | 6,915 | | | | 25,625 | | | | 2,587 | | | | 6,954 | | | | 28,173 | | | | 35,127 | | | | (5,283) | | | | 29,844 | | | | - | | | | 08/19/2004 | | North Main Place | | | 68 | | | | 53 | | | | 522 | | | | 68 | | | | 575 | | | | 643 | | | | (348) | | | | 295 | | | | - | | | | 06/29/1976 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | Description | | Land | | Building and Improvements | | Cost Capitalized Subsequent to Acquisition | | Land | | Building and Improvements | | Total (1) | | Accumulated Depreciation | | Total Costs, Net of Accumulated Depreciation | | Encumbrances (2) | | Date of Acquisition / Construction | | Griggs Road Shopping Center | | $ | 257 |
| | $ | 2,303 |
| | $ | (252 | ) | | $ | 257 |
| | $ | 2,051 |
| | $ | 2,308 |
| | $ | (1,881 | ) | | $ | 427 |
| | $ | (3,884 | ) | | 03/20/2008 | | Hallmark Town Center | | 1,368 |
| | 5,472 |
| | 1,101 |
| | 1,367 |
| | 6,574 |
| | 7,941 |
| | (2,607 | ) | | 5,334 |
| | — |
| | 04/02/2001 | | Harrisburg Plaza | | 1,278 |
| | 3,924 |
| | 933 |
| | 1,278 |
| | 4,857 |
| | 6,135 |
| | (4,055 | ) | | 2,080 |
| | (10,418 | ) | | 03/20/2008 | | HEB - Dairy Ashford & Memorial | | 1,717 |
| | 4,234 |
| | — |
| | 1,717 |
| | 4,234 |
| | 5,951 |
| | (533 | ) | | 5,418 |
| | — |
| | 03/06/2012 | | Heights Plaza Shopping Center | | 58 |
| | 699 |
| | 2,494 |
| | 928 |
| | 2,323 |
| | 3,251 |
| | (1,394 | ) | | 1,857 |
| | — |
| | 06/30/1995 | | High House Crossing | | 2,576 |
| | 10,305 |
| | 467 |
| | 2,576 |
| | 10,772 |
| | 13,348 |
| | (3,680 | ) | | 9,668 |
| | — |
| | 04/04/2002 | | Highland Square | | — |
| | — |
| | 1,887 |
| | — |
| | 1,887 |
| | 1,887 |
| | (472 | ) | | 1,415 |
| | — |
| | 10/06/1959 | | Hope Valley Commons | | 2,439 |
| | 8,487 |
| | 349 |
| | 2,439 |
| | 8,836 |
| | 11,275 |
| | (1,070 | ) | | 10,205 |
| | — |
| | 08/31/2010 | | Humblewood Shopping Center | | 2,215 |
| | 4,724 |
| | 3,174 |
| | 1,166 |
| | 8,947 |
| | 10,113 |
| | (8,207 | ) | | 1,906 |
| | (12,705 | ) | | 03/09/1977 | | I45/Telephone Rd. | | 678 |
| | 11,182 |
| | 596 |
| | 678 |
| | 11,778 |
| | 12,456 |
| | (5,769 | ) | | 6,687 |
| | (12,758 | ) | | 03/20/2008 | | Independence Plaza I | | 12,795 |
| | 23,063 |
| | 191 |
| | 12,795 |
| | 23,254 |
| | 36,049 |
| | (1,651 | ) | | 34,398 |
| | (18,112 | ) | | 06/11/2013 | | Independence Plaza II | | 6,555 |
| | 8,564 |
| | 1,275 |
| | 6,555 |
| | 9,839 |
| | 16,394 |
| | (638 | ) | | 15,756 |
| | — |
| | 06/11/2013 | | Jess Ranch Marketplace | | 8,750 |
| | 25,560 |
| | 296 |
| | 8,750 |
| | 25,856 |
| | 34,606 |
| | (1,174 | ) | | 33,432 |
| | — |
| | 12/23/2013 | | Jess Ranch Marketplace Phase III | | 8,431 |
| | 21,470 |
| | 91 |
| | 8,431 |
| | 21,561 |
| | 29,992 |
| | (991 | ) | | 29,001 |
| | — |
| | 12/23/2013 | | Lake Pointe Market | | 1,404 |
| | — |
| | 4,454 |
| | 1,960 |
| | 3,898 |
| | 5,858 |
| | (2,167 | ) | | 3,691 |
| | — |
| | 12/31/2004 | | Lakeside Marketplace | | 6,064 |
| | 22,989 |
| | 3,348 |
| | 6,150 |
| | 26,251 |
| | 32,401 |
| | (6,700 | ) | | 25,701 |
| | (16,394 | ) | | 08/22/2006 | | Largo Mall | | 10,817 |
| | 40,906 |
| | 3,847 |
| | 10,810 |
| | 44,760 |
| | 55,570 |
| | (12,926 | ) | | 42,644 |
| | — |
| | 03/01/2004 | | Laveen Village Marketplace | | 1,190 |
| | — |
| | 5,204 |
| | 1,006 |
| | 5,388 |
| | 6,394 |
| | (3,011 | ) | | 3,383 |
| | — |
| | 08/15/2003 | | Lawndale Shopping Center | | 82 |
| | 927 |
| | 727 |
| | 82 |
| | 1,654 |
| | 1,736 |
| | (1,091 | ) | | 645 |
| | (3,635 | ) | | 03/20/2008 | | League City Plaza | | 1,918 |
| | 7,592 |
| | 874 |
| | 1,918 |
| | 8,466 |
| | 10,384 |
| | (4,665 | ) | | 5,719 |
| | (10,085 | ) | | 03/20/2008 | | Leesville Towne Centre | | 7,183 |
| | 17,162 |
| | 1,346 |
| | 7,223 |
| | 18,468 |
| | 25,691 |
| | (5,238 | ) | | 20,453 |
| | — |
| | 01/30/2004 | | Little York Plaza Shopping Center | | 342 |
| | 5,170 |
| | 1,753 |
| | 342 |
| | 6,923 |
| | 7,265 |
| | (5,677 | ) | | 1,588 |
| | (4,396 | ) | | 03/20/2008 | | Lyons Avenue Shopping Center | | 249 |
| | 1,183 |
| | 54 |
| | 249 |
| | 1,237 |
| | 1,486 |
| | (1,042 | ) | | 444 |
| | (2,644 | ) | | 03/20/2008 | | Madera Village Shopping Center | | 3,788 |
| | 13,507 |
| | 1,239 |
| | 3,816 |
| | 14,718 |
| | 18,534 |
| | (3,446 | ) | | 15,088 |
| | — |
| | 03/13/2007 | | Market at Town Center - Sugarland | | 8,600 |
| | 26,627 |
| | 23,907 |
| | 8,600 |
| | 50,534 |
| | 59,134 |
| | (22,702 | ) | | 36,432 |
| | — |
| | 12/23/1996 | | Market at Westchase Shopping Center | | 1,199 |
| | 5,821 |
| | 2,632 |
| | 1,415 |
| | 8,237 |
| | 9,652 |
| | (5,683 | ) | | 3,969 |
| | — |
| | 02/15/1991 | | Marketplace at Seminole Outparcel | | 1,000 |
| | — |
| | 1,499 |
| | 1,046 |
| | 1,453 |
| | 2,499 |
| | (28 | ) | | 2,471 |
| | — |
| | 08/21/2006 | | Marketplace at Seminole Towne | | 15,067 |
| | 53,743 |
| | 6,144 |
| | 21,665 |
| | 53,289 |
| | 74,954 |
| | (11,767 | ) | | 63,187 |
| | (38,305 | ) | | 08/21/2006 | | Markham West Shopping Center | | 2,694 |
| | 10,777 |
| | 4,080 |
| | 2,696 |
| | 14,855 |
| | 17,551 |
| | (7,541 | ) | | 10,010 |
| | — |
| | 09/18/1998 | | Marshall's Plaza | | 1,802 |
| | 12,315 |
| | 661 |
| | 1,804 |
| | 12,974 |
| | 14,778 |
| | (3,391 | ) | | 11,387 |
| | — |
| | 06/01/2005 | | Mendenhall Commons | | 2,655 |
| | 9,165 |
| | 653 |
| | 2,677 |
| | 9,796 |
| | 12,473 |
| | (2,379 | ) | | 10,094 |
| | — |
| | 11/13/2008 | | Menifee Town Center | | 1,827 |
| | 7,307 |
| | 4,985 |
| | 1,824 |
| | 12,295 |
| | 14,119 |
| | (4,302 | ) | | 9,817 |
| | — |
| | 04/02/2001 | | Millpond Center | | 3,155 |
| | 9,706 |
| | 1,564 |
| | 3,161 |
| | 11,264 |
| | 14,425 |
| | (3,378 | ) | | 11,047 |
| | — |
| | 07/28/2005 | | Mohave Crossroads | | 3,953 |
| | 63 |
| | 35,919 |
| | 3,128 |
| | 36,807 |
| | 39,935 |
| | (16,016 | ) | | 23,919 |
| | — |
| | 12/31/2009 | | Monte Vista Village Center | | 1,485 |
| | 58 |
| | 5,528 |
| | 755 |
| | 6,316 |
| | 7,071 |
| | (3,960 | ) | | 3,111 |
| | — |
| | 12/31/2004 |
Schedule III (Continued)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | | | | | Description | | Land | | | Building and
Improvements | | | Cost
Capitalized
Subsequent to
Acquisition | | | Land | | | Building and
Improvements | | | Total (1)(2) | | | Accumulated
Depreciation
(2) | | | Total Costs,
Net of
Accumulated
Depreciation | | | Encumbrances
(3) | | | Date of
Acquisition /
Construction | | North Oaks Shopping Center | | $ | 3,644 | | | $ | 22,040 | | | $ | 3,447 | | | $ | 3,644 | | | $ | 25,487 | | | $ | 29,131 | | | $ | (17,968) | | | $ | 11,163 | | | $ | (34,518) | | | | 03/20/2008 | | North Towne Plaza | | | 960 | | | | 3,928 | | | | 5,995 | | | | 879 | | | | 10,004 | | | | 10,883 | | | | (6,439) | | | | 4,444 | | | | (10,271) | | | | 02/15/1990 | | North Triangle Shops | | | - | | | | 431 | | | | 261 | | | | 15 | | | | 677 | | | | 692 | | | | (450) | | | | 242 | | | | - | | | | 01/15/1977 | | Northbrook Shopping Center | | | 1,629 | | | | 4,489 | | | | 3,048 | | | | 1,713 | | | | 7,453 | | | | 9,166 | | | | (6,671) | | | | 2,495 | | | | (9,430) | | | | 11/06/1967 | | Northwoods Shopping Center | | | 1,768 | | | | 7,071 | | | | 238 | | | | 1,772 | | | | 7,305 | | | | 9,077 | | | | (1,859) | | | | 7,218 | | | | - | | | | 04/04/2002 | | Oak Forest Shopping Center | | | 760 | | | | 2,726 | | | | 4,812 | | | | 748 | | | | 7,550 | | | | 8,298 | | | | (4,829) | | | | 3,469 | | | | - | | | | 12/30/1976 | | Oak Grove Market Center | | | 5,758 | | | | 10,508 | | | | 131 | | | | 5,861 | | | | 10,536 | | | | 16,397 | | | | (1,302) | | | | 15,095 | | | | (7,358) | | | | 06/15/2007 | | Oak Park Village | | | 678 | | | | 3,332 | | | | 51 | | | | 678 | | | | 3,383 | | | | 4,061 | | | | (1,581) | | | | 2,480 | | | | (4,544) | | | | 11/13/2008 | | Oracle Crossings | | | 4,614 | | | | 18,274 | | | | 28,423 | | | | 10,582 | | | | 40,729 | | | | 51,311 | | | | (4,371) | | | | 46,940 | | | | - | | | | 01/22/2007 | | Oracle Wetmore Shopping Center | | | 24,686 | | | | 26,878 | | | | 4,394 | | | | 13,813 | | | | 42,145 | | | | 55,958 | | | | (4,816) | | | | 51,142 | | | | - | | | | 01/22/2007 | | Orchard Green Shopping Center | | | 777 | | | | 1,477 | | | | 1,983 | | | | 786 | | | | 3,451 | | | | 4,237 | | | | (2,253) | | | | 1,984 | | | | - | | | | 10/11/1973 | | Orleans Station | | | 165 | | | | - | | | | (9) | | | | 93 | | | | 63 | | | | 156 | | | | (40) | | | | 116 | | | | - | | | | 06/29/1976 | | Overton Park Plaza | | | 9,266 | | | | 37,789 | | | | 7,351 | | | | 9,264 | | | | 45,142 | | | | 54,406 | | | | (8,592) | | | | 45,814 | | | | - | | | | 10/24/2003 | | Palmer Plaza | | | 765 | | | | 3,081 | | | | 2,418 | | | | 827 | | | | 5,437 | | | | 6,264 | | | | (3,458) | | | | 2,806 | | | | - | | | | 07/31/1980 | | Palmilla Center | | | 1,258 | | | | - | | | | 12,888 | | | | 3,280 | | | | 10,866 | | | | 14,146 | | | | (5,748) | | | | 8,398 | | | | - | | | | 12/31/2002 | | Palms of Carrollwood | | | 3,995 | | | | 16,390 | | | | 94 | | | | 3,995 | | | | 16,484 | | | | 20,479 | | | | (423) | | | | 20,056 | | | | - | | | | 12/23/2010 | | Paradise Marketplace | | | 2,153 | | | | 8,612 | | | | (2,165) | | | | 1,197 | | | | 7,403 | | | | 8,600 | | | | (3,326) | | | | 5,274 | | | | - | | | | 07/20/1995 | | Park Plaza Shopping Center | | | 257 | | | | 7,815 | | | | 1,007 | | | | 314 | | | | 8,765 | | | | 9,079 | | | | (8,178) | | | | 901 | | | | - | | | | 01/24/1975 | | Parkway Pointe | | | 1,252 | | | | 5,010 | | | | 675 | | | | 1,260 | | | | 5,677 | | | | 6,937 | | | | (1,718) | | | | 5,219 | | | | (689) | | | | 06/29/2001 | | Parliament Square II | | | 2 | | | | 10 | | | | 1,175 | | | | 3 | | | | 1,184 | | | | 1,187 | | | | (437) | | | | 750 | | | | - | | | | 06/24/2005 | | Parliament Square Shopping Ctr | | | 443 | | | | 1,959 | | | | 1,321 | | | | 443 | | | | 3,280 | | | | 3,723 | | | | (1,981) | | | | 1,742 | | | | - | | | | 03/18/1992 | | Pavilions at San Mateo | | | 3,272 | | | | 26,215 | | | | (2,453) | | | | 3,962 | | | | 23,072 | | | | 27,034 | | | | (6,668) | | | | 20,366 | | | | - | | | | 04/30/2004 | | Perimeter Village | | | 29,701 | | | | 42,337 | | | | (894) | | | | 34,404 | | | | 36,740 | | | | 71,144 | | | | (4,560) | | | | 66,584 | | | | (27,058) | | | | 07/03/2007 | | Phelan West Shopping Center | | | 401 | | | | - | | | | 1,185 | | | | 414 | | | | 1,172 | | | | 1,586 | | | | (587) | | | | 999 | | | | - | | | | 06/03/1998 | | Phillips Crossing | | | - | | | | 1 | | | | 27,540 | | | | 872 | | | | 26,669 | | | | 27,541 | | | | (4,576) | | | | 22,965 | | | | - | | | | 09/30/2009 | | Phillips Landing | | | 1,521 | | | | 1,625 | | | | 10,698 | | | | 1,819 | | | | 12,025 | | | | 13,844 | | | | (2,445) | | | | 11,399 | | | | - | | | | 09/30/2009 | | Pinecrest Plaza Shopping Ctr | | | 5,837 | | | | 19,166 | | | | 1,238 | | | | 5,837 | | | | 20,404 | | | | 26,241 | | | | (3,760) | | | | 22,481 | | | | - | | | | 04/06/2005 | | Pitman Corners | | | 2,686 | | | | 10,745 | | | | 2,254 | | | | 2,693 | | | | 12,992 | | | | 15,685 | | | | (3,870) | | | | 11,815 | | | | - | | | | 04/08/2002 | | Plantation Centre | | | 3,463 | | | | 14,821 | | | | 699 | | | | 3,471 | | | | 15,512 | | | | 18,983 | | | | (2,902) | | | | 16,081 | | | | (2,288) | | | | 08/19/2004 | | Prien Lake Plaza | | | 63 | | | | 960 | | | | 159 | | | | 41 | | | | 1,141 | | | | 1,182 | | | | (284) | | | | 898 | | | | - | | | | 07/26/2007 | | Promenade 23 | | | 16,028 | | | | 2,271 | | | | 8 | | | | 16,028 | | | | 2,279 | | | | 18,307 | | | | (75) | | | | 18,232 | | | | - | | | | 03/25/2011 | | Promenade Shopping Center | | | 1,058 | | | | 4,248 | | | | (1,219) | | | | 644 | | | | 3,443 | | | | 4,087 | | | | (1,490) | | | | 2,597 | | | | (3,399) | | | | 03/18/2004 | | Prospector’s Plaza | | | 3,746 | | | | 14,985 | | | | 1,138 | | | | 3,716 | | | | 16,153 | | | | 19,869 | | | | (4,499) | | | | 15,370 | | | | - | | | | 04/02/2001 | | Publix at Laguna Isles | | | 2,913 | | | | 9,554 | | | | 155 | | | | 2,914 | | | | 9,708 | | | | 12,622 | | | | (2,043) | | | | 10,579 | | | | - | | | | 10/31/2003 | | Pueblo Anozira Shopping Center | | | 2,750 | | | | 11,000 | | | | 4,619 | | | | 2,768 | | | | 15,601 | | | | 18,369 | | | | (6,943) | | | | 11,426 | | | | (11,452) | | | | 06/16/1994 | | Rainbow Plaza | | | 6,059 | | | | 24,234 | | | | 1,503 | | | | 6,081 | | | | 25,715 | | | | 31,796 | | | | (9,729) | | | | 22,067 | | | | - | | | | 10/22/1997 | | Rainbow Plaza I | | | 3,883 | | | | 15,540 | | | | 858 | | | | 3,896 | | | | 16,385 | | | | 20,281 | | | | (4,626) | | | | 15,655 | | | | - | | | | 12/28/2000 | | Raintree Ranch Center | | | 11,442 | | | | 595 | | | | 17,139 | | | | 10,983 | | | | 18,193 | | | | 29,176 | | | | (4,795) | | | | 24,381 | | | | - | | | | 03/31/2008 | | Rancho Encanto | | | 957 | | | | 3,829 | | | | 3,830 | | | | 846 | | | | 7,770 | | | | 8,616 | | | | (3,038) | | | | 5,578 | | | | - | | | | 04/28/1997 | | Rancho San Marcos Village | | | 3,533 | | | | 14,138 | | | | 3,871 | | | | 3,887 | | | | 17,655 | | | | 21,542 | | | | (4,379) | | | | 17,163 | | | | - | | | | 02/26/2003 | | Rancho Towne & Country | | | 1,161 | | | | 4,647 | | | | 471 | | | | 1,166 | | | | 5,113 | | | | 6,279 | | | | (2,207) | | | | 4,072 | | | | - | | | | 10/16/1995 | | Randalls Center/Kings Crossing | | | 3,570 | | | | 8,147 | | | | 91 | | | | 3,570 | | | | 8,238 | | | | 11,808 | | | | (4,542) | | | | 7,266 | | | | (12,058) | | | | 11/13/2008 | | Randall’s/Norchester Village | | | 1,852 | | | | 4,510 | | | | 1,577 | | | | 1,846 | | | | 6,093 | | | | 7,939 | | | | (4,220) | | | | 3,719 | | | | - | | | | 09/30/1991 | | Ravenstone Commons | | | 2,616 | | | | 7,986 | | | | (173) | | | | 2,580 | | | | 7,849 | | | | 10,429 | | | | (1,359) | | | | 9,070 | | | | (5,716) | | | | 03/22/2005 | | Red Mountain Gateway | | | 2,166 | | | | 89 | | | | 9,399 | | | | 2,737 | | | | 8,917 | | | | 11,654 | | | | (3,799) | | | | 7,855 | | | | - | | | | 12/31/2003 | | Regency Centre | | | 3,791 | | | | 15,390 | | | | 879 | | | | 2,180 | | | | 17,880 | | | | 20,060 | | | | (2,775) | | | | 17,285 | | | | - | | | | 07/28/2006 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | Description | | Land | | Building and Improvements | | Cost Capitalized Subsequent to Acquisition | | Land | | Building and Improvements | | Total (1) | | Accumulated Depreciation | | Total Costs, Net of Accumulated Depreciation | | Encumbrances (2) | | Date of Acquisition / Construction | | Moore Plaza | | $ | 6,445 |
| | $ | 26,140 |
| | $ | 11,033 |
| | $ | 6,487 |
| | $ | 37,131 |
| | $ | 43,618 |
| | $ | (17,502 | ) | | $ | 26,116 |
| | $ | — |
| | 03/20/1998 | | Mueller Regional Retail Center | | 10,382 |
| | 56,303 |
| | 165 |
| | 10,382 |
| | 56,468 |
| | 66,850 |
| | (3,159 | ) | | 63,691 |
| | (34,300 | ) | | 10/03/2013 | | North Creek Plaza | | 6,915 |
| | 25,625 |
| | 4,200 |
| | 6,954 |
| | 29,786 |
| | 36,740 |
| | (8,848 | ) | | 27,892 |
| | — |
| | 08/19/2004 | | North Towne Plaza | | 960 |
| | 3,928 |
| | 7,405 |
| | 879 |
| | 11,414 |
| | 12,293 |
| | (7,708 | ) | | 4,585 |
| | (9,676 | ) | | 02/15/1990 | | North Towne Plaza | | 6,646 |
| | 99 |
| | 1,526 |
| | 1,005 |
| | 7,266 |
| | 8,271 |
| | (1,680 | ) | | 6,591 |
| | — |
| | 04/01/2010 | | Northbrook Shopping Center | | 1,629 |
| | 4,489 |
| | 3,037 |
| | 1,713 |
| | 7,442 |
| | 9,155 |
| | (6,788 | ) | | 2,367 |
| | (9,082 | ) | | 11/06/1967 | | Northwoods Shopping Center | | 1,768 |
| | 7,071 |
| | 421 |
| | 1,772 |
| | 7,488 |
| | 9,260 |
| | (2,496 | ) | | 6,764 |
| | — |
| | 04/04/2002 | | Oak Forest Shopping Center | | 760 |
| | 2,726 |
| | 4,929 |
| | 748 |
| | 7,667 |
| | 8,415 |
| | (5,744 | ) | | 2,671 |
| | (7,904 | ) | | 12/30/1976 | | Oak Grove Market Center | | 5,758 |
| | 10,508 |
| | 940 |
| | 5,861 |
| | 11,345 |
| | 17,206 |
| | (2,334 | ) | | 14,872 |
| | (7,358 | ) | | 06/15/2007 | | Oracle Crossings | | 4,614 |
| | 18,274 |
| | 28,966 |
| | 10,582 |
| | 41,272 |
| | 51,854 |
| | (8,440 | ) | | 43,414 |
| | — |
| | 01/22/2007 | | Oracle Wetmore Shopping Center | | 24,686 |
| | 26,878 |
| | 6,975 |
| | 13,813 |
| | 44,726 |
| | 58,539 |
| | (9,114 | ) | | 49,425 |
| | — |
| | 01/22/2007 | | Overton Park Plaza | | 9,266 |
| | 37,789 |
| | 11,729 |
| | 9,264 |
| | 49,520 |
| | 58,784 |
| | (14,192 | ) | | 44,592 |
| | — |
| | 10/24/2003 | | Palmer Plaza | | 765 |
| | 3,081 |
| | 2,558 |
| | 827 |
| | 5,577 |
| | 6,404 |
| | (3,808 | ) | | 2,596 |
| | — |
| | 07/31/1980 | | Palmilla Center | | 1,258 |
| | — |
| | 13,013 |
| | 2,882 |
| | 11,389 |
| | 14,271 |
| | (6,534 | ) | | 7,737 |
| | — |
| | 12/31/2002 | | Palms of Carrollwood | | 3,995 |
| | 16,390 |
| | 710 |
| | 3,995 |
| | 17,100 |
| | 21,095 |
| | (1,769 | ) | | 19,326 |
| | — |
| | 12/23/2010 | | Paradise Marketplace | | 2,153 |
| | 8,612 |
| | (2,091 | ) | | 1,197 |
| | 7,477 |
| | 8,674 |
| | (3,921 | ) | | 4,753 |
| | — |
| | 07/20/1995 | | Parliament Square II | | 2 |
| | 10 |
| | 1,183 |
| | 3 |
| | 1,192 |
| | 1,195 |
| | (706 | ) | | 489 |
| | — |
| | 06/24/2005 | | Perimeter Village | | 29,701 |
| | 42,337 |
| | 3,551 |
| | 34,404 |
| | 41,185 |
| | 75,589 |
| | (8,803 | ) | | 66,786 |
| | (26,058 | ) | | 07/03/2007 | | Phillips Crossing | | — |
| | 1 |
| | 28,208 |
| | 872 |
| | 27,337 |
| | 28,209 |
| | (9,368 | ) | | 18,841 |
| | — |
| | 09/30/2009 | | Phoenix Office Building | | 1,696 |
| | 3,255 |
| | 1,164 |
| | 1,773 |
| | 4,342 |
| | 6,115 |
| | (1,276 | ) | | 4,839 |
| | — |
| | 01/31/2007 | | Pike Center | | — |
| | 40,537 |
| | 2,035 |
| | — |
| | 42,572 |
| | 42,572 |
| | (4,320 | ) | | 38,252 |
| | — |
| | 08/14/2012 | | Plantation Centre | | 3,463 |
| | 14,821 |
| | 1,849 |
| | 3,471 |
| | 16,662 |
| | 20,133 |
| | (4,546 | ) | | 15,587 |
| | — |
| | 08/19/2004 | | Promenade 23 | | 16,028 |
| | 2,271 |
| | 39 |
| | 16,028 |
| | 2,310 |
| | 18,338 |
| | (381 | ) | | 17,957 |
| | — |
| | 03/25/2011 | | Prospector's Plaza | | 3,746 |
| | 14,985 |
| | 5,743 |
| | 3,716 |
| | 20,758 |
| | 24,474 |
| | (5,928 | ) | | 18,546 |
| | — |
| | 04/02/2001 | | Pueblo Anozira Shopping Center | | 2,750 |
| | 11,000 |
| | 5,123 |
| | 2,768 |
| | 16,105 |
| | 18,873 |
| | (8,661 | ) | | 10,212 |
| | (11,028 | ) | | 06/16/1994 | | Rainbow Plaza | | 6,059 |
| | 24,234 |
| | 2,742 |
| | 6,081 |
| | 26,954 |
| | 33,035 |
| | (11,786 | ) | | 21,249 |
| | — |
| | 10/22/1997 | | Rainbow Plaza I | | 3,883 |
| | 15,540 |
| | 571 |
| | 3,896 |
| | 16,098 |
| | 19,994 |
| | (5,782 | ) | | 14,212 |
| | — |
| | 12/28/2000 | | Raintree Ranch Center | | 11,442 |
| | 595 |
| | 17,553 |
| | 10,983 |
| | 18,607 |
| | 29,590 |
| | (8,533 | ) | | 21,057 |
| | — |
| | 03/31/2008 | | Rancho Encanto | | 957 |
| | 3,829 |
| | 3,814 |
| | 839 |
| | 7,761 |
| | 8,600 |
| | (4,783 | ) | | 3,817 |
| | — |
| | 04/28/1997 | | Rancho San Marcos Village | | 3,533 |
| | 14,138 |
| | 5,066 |
| | 3,887 |
| | 18,850 |
| | 22,737 |
| | (6,000 | ) | | 16,737 |
| | — |
| | 02/26/2003 | | Rancho Towne & Country | | 1,161 |
| | 4,647 |
| | 728 |
| | 1,166 |
| | 5,370 |
| | 6,536 |
| | (2,693 | ) | | 3,843 |
| | — |
| | 10/16/1995 | | Randalls Center/Kings Crossing | | 3,570 |
| | 8,147 |
| | 551 |
| | 3,585 |
| | 8,683 |
| | 12,268 |
| | (5,202 | ) | | 7,066 |
| | — |
| | 11/13/2008 | | Red Mountain Gateway | | 2,166 |
| | 89 |
| | 9,457 |
| | 2,737 |
| | 8,975 |
| | 11,712 |
| | (4,498 | ) | | 7,214 |
| | — |
| | 12/31/2003 | | Regency Centre | | 5,616 |
| | 18,516 |
| | 1,613 |
| | 3,581 |
| | 22,164 |
| | 25,745 |
| | (5,288 | ) | | 20,457 |
| | — |
| | 07/28/2006 | | Reynolds Crossing | | 4,276 |
| | 9,186 |
| | 145 |
| | 4,276 |
| | 9,331 |
| | 13,607 |
| | (2,018 | ) | | 11,589 |
| | — |
| | 09/14/2006 |
Schedule III (Continued)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | | | | | Description | | Land | | | Building and
Improvements | | | Cost
Capitalized
Subsequent to
Acquisition | | | Land | | | Building and
Improvements | | | Total (1)(2) | | | Accumulated
Depreciation
(2) | | | Total Costs,
Net of
Accumulated
Depreciation | | | Encumbrances
(3) | | | Date of
Acquisition /
Construction | | Regency Panera Tract | | $ | 1,825 | �� | | $ | 3,126 | | | $ | 65 | | | $ | 1,400 | | | $ | 3,616 | | | $ | 5,016 | | | $ | (490) | | | $ | 4,526 | | | $ | - | | | | 07/28/2006 | | Reynolds Crossing | | | 4,276 | | | | 9,186 | | | | 71 | | | | 4,276 | | | | 9,257 | | | | 13,533 | | | | (1,287) | | | | 12,246 | | | | - | | | | 09/14/2006 | | Richmond Square | | | 1,993 | | | | 953 | | | | 1,776 | | | | 2,966 | | | | 1,756 | | | | 4,722 | | | | (1,081) | | | | 3,641 | | | | - | | | | 12/31/1996 | | River Oaks Shopping Center | | | 1,354 | | | | 1,946 | | | | 378 | | | | 1,363 | | | | 2,315 | | | | 3,678 | | | | (1,952) | | | | 1,726 | | | | - | | | | 12/04/1992 | | River Oaks Shopping Center | | | 3,534 | | | | 17,741 | | | | 34,815 | | | | 4,207 | | | | 51,883 | | | | 56,090 | | | | (17,690) | | | | 38,400 | | | | - | | | | 12/04/1992 | | Rose-Rich Shopping Center | | | 502 | | | | 2,738 | | | | 2,988 | | | | 486 | | | | 5,742 | | | | 6,228 | | | | (5,193) | | | | 1,035 | | | | - | | | | 03/01/1982 | | Roswell Corners | | | 5,835 | | | | 20,465 | | | | 1,244 | | | | 5,835 | | | | 21,709 | | | | 27,544 | | | | (4,438) | | | | 23,106 | | | | (8,889) | | | | 06/24/2004 | | Roswell Corners | | | 301 | | | | 982 | | | | - | | | | 301 | | | | 982 | | | | 1,283 | | | | (195) | | | | 1,088 | | | | - | | | | 06/24/2004 | | San Marcos Plaza | | | 1,360 | | | | 5,439 | | | | 294 | | | | 1,358 | | | | 5,735 | | | | 7,093 | | | | (1,608) | | | | 5,485 | | | | - | | | | 04/02/2001 | | Sandy Plains Exchange | | | 2,468 | | | | 7,549 | | | | 266 | | | | 2,469 | | | | 7,814 | | | | 10,283 | | | | (1,734) | | | | 8,549 | | | | (5,705) | | | | 10/17/2003 | | Scottsdale Horizon | | | - | | | | 3,241 | | | | 268 | | | | 1 | | | | 3,508 | | | | 3,509 | | | | (438) | | | | 3,071 | | | | - | | | | 01/22/2007 | | Shasta Crossroads | | | 2,844 | | | | 11,377 | | | | 823 | | | | 2,842 | | | | 12,202 | | | | 15,044 | | | | (3,307) | | | | 11,737 | | | | - | | | | 04/02/2001 | | Sheldon Forest Shopping Center | | | 374 | | | | 635 | | | | 329 | | | | 354 | | | | 984 | | | | 1,338 | | | | (802) | | | | 536 | | | | - | | | | 05/14/1970 | | Sheldon Forest Shopping Center | | | 629 | | | | 1,955 | | | | 851 | | | | 629 | | | | 2,806 | | | | 3,435 | | | | (2,655) | | | | 780 | | | | - | | | | 05/14/1970 | | Shoppes at Bears Path | | | 3,252 | | | | 5,503 | | | | 988 | | | | 3,290 | | | | 6,453 | | | | 9,743 | | | | (898) | | | | 8,845 | | | | (3,204) | | | | 03/13/2007 | | Shoppes of Parkland | | | 5,413 | | | | 16,726 | | | | 1,035 | | | | 9,506 | | | | 13,668 | | | | 23,174 | | | | (2,100) | | | | 21,074 | | | | (14,876) | | | | 05/31/2006 | | Shoppes of South Semoran | | | 4,283 | | | | 9,785 | | | | (1,799) | | | | 4,745 | | | | 7,524 | | | | 12,269 | | | | (1,038) | | | | 11,231 | | | | (9,398) | | | | 08/31/2007 | | Shops at Kirby Drive | | | 1,201 | | | | 945 | | | | 268 | | | | 1,202 | | | | 1,212 | | | | 2,414 | | | | (149) | | | | 2,265 | | | | - | | | | 05/27/2008 | | Shops at Three Corners | | | 6,215 | | | | 9,303 | | | | 5,362 | | | | 6,224 | | | | 14,656 | | | | 20,880 | | | | (8,209) | | | | 12,671 | | | | - | | | | 12/31/1989 | | Silver Creek Plaza | | | 3,231 | | | | 12,924 | | | | 2,942 | | | | 3,228 | | | | 15,869 | | | | 19,097 | | | | (4,825) | | | | 14,272 | | | | - | | | | 04/02/2001 | | Six Forks Shopping Center | | | 6,678 | | | | 26,759 | | | | 3,308 | | | | 6,728 | | | | 30,017 | | | | 36,745 | | | | (8,259) | | | | 28,486 | | | | - | | | | 04/04/2002 | | South Semoran - Pad | | | 1,056 | | | | - | | | | (129) | | | | 927 | | | | - | | | | 927 | | | | - | | | | 927 | | | | - | | | | 09/06/2007 | | Southampton Center | | | 4,337 | | | | 17,349 | | | | 2,292 | | | | 4,333 | | | | 19,645 | | | | 23,978 | | | | (5,406) | | | | 18,572 | | | | (20,758) | | | | 04/02/2001 | | Southgate Shopping Center | | | 571 | | | | 3,402 | | | | 5,399 | | | | 852 | | | | 8,520 | | | | 9,372 | | | | (6,752) | | | | 2,620 | | | | - | | | | 03/26/1958 | | Southgate Shopping Center | | | 232 | | | | 8,389 | | | | 415 | | | | 232 | | | | 8,804 | | | | 9,036 | | | | (5,252) | | | | 3,784 | | | | (7,590) | | | | 03/20/2008 | | Spring Plaza Shopping Center | | | 863 | | | | 2,288 | | | | 523 | | | | 863 | | | | 2,811 | | | | 3,674 | | | | (2,247) | | | | 1,427 | | | | (3,082) | | | | 03/20/2008 | | Squaw Peak Plaza | | | 816 | | | | 3,266 | | | | 1,243 | | | | 818 | | | | 4,507 | | | | 5,325 | | | | (1,865) | | | | 3,460 | | | | - | | | | 12/20/1994 | | Steele Creek Crossing | | | 310 | | | | 11,774 | | | | 3,245 | | | | 3,281 | | | | 12,048 | | | | 15,329 | | | | (2,177) | | | | 13,152 | | | | - | | | | 06/10/2005 | | Stella Link Shopping Center | | | 227 | | | | 423 | | | | 1,529 | | | | 294 | | | | 1,885 | | | | 2,179 | | | | (1,585) | | | | 594 | | | | - | | | | 07/10/1970 | | Stella Link Shopping Center | | | 2,602 | | | | 1,418 | | | | (1,319) | | | | 2,602 | | | | 99 | | | | 2,701 | | | | (11) | | | | 2,690 | | | | - | | | | 08/21/2007 | | Stonehenge Market | | | 4,740 | | | | 19,001 | | | | 1,294 | | | | 4,740 | | | | 20,295 | | | | 25,035 | | | | (5,515) | | | | 19,520 | | | | (5,957) | | | | 04/04/2002 | | Stony Point Plaza | | | 3,489 | | | | 13,957 | | | | 8,622 | | | | 3,453 | | | | 22,615 | | | | 26,068 | | | | (4,249) | | | | 21,819 | | | | - | | | | 04/02/2001 | | Studewood Shopping Center | | | 261 | | | | 552 | | | | - | | | | 261 | | | | 552 | | | | 813 | | | | (552) | | | | 261 | | | | - | | | | 05/25/1984 | | Summer Center | | | 2,379 | | | | 8,343 | | | | 3,780 | | | | 2,396 | | | | 12,106 | | | | 14,502 | | | | (4,043) | | | | 10,459 | | | | - | | | | 05/15/2001 | | Summerhill Plaza | | | 1,945 | | | | 7,781 | | | | 1,984 | | | | 1,943 | | | | 9,767 | | | | 11,710 | | | | (3,223) | | | | 8,487 | | | | - | | | | 04/02/2001 | | Sunset 19 Shopping Center | | | 5,519 | | | | 22,076 | | | | 1,190 | | | | 5,547 | | | | 23,238 | | | | 28,785 | | | | (5,953) | | | | 22,832 | | | | - | | | | 10/29/2001 | | Sunset Shopping Center | | | 1,121 | | | | 4,484 | | | | 1,670 | | | | 1,120 | | | | 6,155 | | | | 7,275 | | | | (1,808) | | | | 5,467 | | | | - | | | | 04/02/2001 | | Tates Creek Centre | | | 4,802 | | | | 25,366 | | | | 391 | | | | 5,766 | | | | 24,793 | | | | 30,559 | | | | (5,098) | | | | 25,461 | | | | - | | | | 03/01/2004 | | Taylorsville Town Center | | | 2,179 | | | | 9,718 | | | | 708 | | | | 2,180 | | | | 10,425 | | | | 12,605 | | | | (2,367) | | | | 10,238 | | | | - | | | | 12/19/2003 | | The Shoppes at Parkwood Ranch | | | 4,369 | | | | 52 | | | | 9,837 | | | | 2,347 | | | | 11,911 | | | | 14,258 | | | | (2,311) | | | | 11,947 | | | | - | | | | 12/31/2009 | | The Village Arcade | | | - | | | | 6,657 | | | | 621 | | | | - | | | | 7,278 | | | | 7,278 | | | | (4,634) | | | | 2,644 | | | | - | | | | 12/31/1992 | | Thompson Bridge Commons | | | 3,650 | | | | 9,264 | | | | 4,217 | | | | 3,541 | | | | 13,590 | | | | 17,131 | | | | (2,247) | | | | 14,884 | | | | (5,933) | | | | 04/26/2005 | | Thousand Oaks Shopping Center | | | 2,973 | | | | 13,142 | | | | 112 | | | | 2,973 | | | | 13,254 | | | | 16,227 | | | | (3,146) | | | | 13,081 | | | | (15,251) | | | | 03/20/2008 | | TJ Maxx Plaza | | | 3,400 | | | | 19,283 | | | | 1,336 | | | | 3,430 | | | | 20,589 | | | | 24,019 | | | | (4,274) | | | | 19,745 | | | | - | | | | 03/01/2004 | | Town & Country Shopping Center | | | - | | | | 3,891 | | | | 4,898 | | | | - | | | | 8,789 | | | | 8,789 | | | | (4,881) | | | | 3,908 | | | | - | | | | 01/31/1989 | | Town and Country - Hammond, LA | | | 1,030 | | | | 7,404 | | | | 1,416 | | | | 1,029 | | | | 8,821 | | | | 9,850 | | | | (4,451) | | | | 5,399 | | | | - | | | | 12/30/1997 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | Description | | Land | | Building and Improvements | | Cost Capitalized Subsequent to Acquisition | | Land | | Building and Improvements | | Total (1) | | Accumulated Depreciation | | Total Costs, Net of Accumulated Depreciation | | Encumbrances (2) | | Date of Acquisition / Construction | | Richmond Square | | $ | 1,993 |
| | $ | 953 |
| | $ | 13,571 |
| | $ | 14,512 |
| | $ | 2,005 |
| | $ | 16,517 |
| | $ | (1,255 | ) | | $ | 15,262 |
| | $ | — |
| | 12/31/1996 | | Ridgeway Trace | | 26,629 |
| | 544 |
| | 20,369 |
| | 15,573 |
| | 31,969 |
| | 47,542 |
| | (8,065 | ) | | 39,477 |
| | — |
| | 11/09/2006 | | River Oaks Shopping Center | | 1,354 |
| | 1,946 |
| | 403 |
| | 1,363 |
| | 2,340 |
| | 3,703 |
| | (2,013 | ) | | 1,690 |
| | — |
| | 12/04/1992 | | River Oaks Shopping Center | | 3,534 |
| | 17,741 |
| | 35,453 |
| | 4,207 |
| | 52,521 |
| | 56,728 |
| | (22,754 | ) | | 33,974 |
| | — |
| | 12/04/1992 | | River Point at Sheridan | | 28,898 |
| | 4,042 |
| | 4,226 |
| | 9,360 |
| | 27,806 |
| | 37,166 |
| | (4,911 | ) | | 32,255 |
| | (6,720 | ) | | 04/01/2010 | | Roswell Corners | | 6,136 |
| | 21,447 |
| | 163 |
| | 5,835 |
| | 21,911 |
| | 27,746 |
| | (6,392 | ) | | 21,354 |
| | (6,621 | ) | | 06/24/2004 | | Roswell Crossing Shopping Center | | 7,625 |
| | 18,573 |
| | 394 |
| | 7,625 |
| | 18,967 |
| | 26,592 |
| | (2,123 | ) | | 24,469 |
| | (12,153 | ) | | 07/18/2012 | | San Marcos Plaza | | 1,360 |
| | 5,439 |
| | 528 |
| | 1,358 |
| | 5,969 |
| | 7,327 |
| | (2,129 | ) | | 5,198 |
| | — |
| | 04/02/2001 | | Scottsdale Horizon | | — |
| | 3,241 |
| | 37,616 |
| | 12,914 |
| | 27,943 |
| | 40,857 |
| | (800 | ) | | 40,057 |
| | — |
| | 01/22/2007 | | Sea Ranch Centre | | 11,977 |
| | 4,219 |
| | 969 |
| | 11,977 |
| | 5,188 |
| | 17,165 |
| | (433 | ) | | 16,732 |
| | — |
| | 03/06/2013 | | Shoppes at Bears Path | | 3,252 |
| | 5,503 |
| | 1,260 |
| | 3,290 |
| | 6,725 |
| | 10,015 |
| | (1,769 | ) | | 8,246 |
| | — |
| | 03/13/2007 | | Shoppes at Memorial Villages | | 1,417 |
| | 4,786 |
| | 7,723 |
| | 3,332 |
| | 10,594 |
| | 13,926 |
| | (6,989 | ) | | 6,937 |
| | — |
| | 01/11/2012 | | Shoppes of South Semoran | | 4,283 |
| | 9,785 |
| | (1,570 | ) | | 4,745 |
| | 7,753 |
| | 12,498 |
| | (1,757 | ) | | 10,741 |
| | (8,842 | ) | | 08/31/2007 | | Shops at Kirby Drive | | 1,201 |
| | 945 |
| | 276 |
| | 1,202 |
| | 1,220 |
| | 2,422 |
| | (387 | ) | | 2,035 |
| | — |
| | 05/27/2008 | | Shops at Three Corners | | 6,215 |
| | 9,303 |
| | 5,490 |
| | 6,224 |
| | 14,784 |
| | 21,008 |
| | (9,677 | ) | | 11,331 |
| | — |
| | 12/31/1989 | | Silver Creek Plaza | | 3,231 |
| | 12,924 |
| | 3,214 |
| | 3,228 |
| | 16,141 |
| | 19,369 |
| | (6,059 | ) | | 13,310 |
| | (15,065 | ) | | 04/02/2001 | | Six Forks Shopping Center | | 6,678 |
| | 26,759 |
| | 5,607 |
| | 6,728 |
| | 32,316 |
| | 39,044 |
| | (11,157 | ) | | 27,887 |
| | — |
| | 04/04/2002 | | South Fulton Crossing | | 14,373 |
| | 154 |
| | (11,434 | ) | | 2,669 |
| | 424 |
| | 3,093 |
| | (2 | ) | | 3,091 |
| | — |
| | 01/10/2007 | | South Semoran - Pad | | 1,056 |
| | — |
| | (129 | ) | | 927 |
| | — |
| | 927 |
| | — |
| | 927 |
| | — |
| | 09/06/2007 | | Southampton Center | | 4,337 |
| | 17,349 |
| | 2,829 |
| | 4,333 |
| | 20,182 |
| | 24,515 |
| | (7,389 | ) | | 17,126 |
| | (19,555 | ) | | 04/02/2001 | | Southgate Shopping Center | | 571 |
| | 3,402 |
| | 5,559 |
| | 1,152 |
| | 8,380 |
| | 9,532 |
| | (7,001 | ) | | 2,531 |
| | — |
| | 03/26/1958 | | Southgate Shopping Center | | 232 |
| | 8,389 |
| | 723 |
| | 232 |
| | 9,112 |
| | 9,344 |
| | (5,666 | ) | | 3,678 |
| | (6,803 | ) | | 03/20/2008 | | Squaw Peak Plaza | | 816 |
| | 3,266 |
| | 3,225 |
| | 818 |
| | 6,489 |
| | 7,307 |
| | (2,803 | ) | | 4,504 |
| | — |
| | 12/20/1994 | | Stella Link Shopping Center | | 227 |
| | 423 |
| | 1,429 |
| | 294 |
| | 1,785 |
| | 2,079 |
| | (1,572 | ) | | 507 |
| | — |
| | 07/10/1970 | | Stella Link Shopping Center | | 2,602 |
| | 1,418 |
| | (1,307 | ) | | 2,602 |
| | 111 |
| | 2,713 |
| | (19 | ) | | 2,694 |
| | — |
| | 08/21/2007 | | Stonehenge Market | | 4,740 |
| | 19,001 |
| | 2,212 |
| | 4,740 |
| | 21,213 |
| | 25,953 |
| | (7,430 | ) | | 18,523 |
| | — |
| | 04/04/2002 | | Stony Point Plaza | | 3,489 |
| | 13,957 |
| | 11,341 |
| | 3,453 |
| | 25,334 |
| | 28,787 |
| | (7,537 | ) | | 21,250 |
| | (11,402 | ) | | 04/02/2001 | | Summerhill Plaza | | 1,945 |
| | 7,781 |
| | 2,572 |
| | 1,943 |
| | 10,355 |
| | 12,298 |
| | (4,394 | ) | | 7,904 |
| | — |
| | 04/02/2001 | | Sunset 19 Shopping Center | | 5,519 |
| | 22,076 |
| | 1,430 |
| | 5,547 |
| | 23,478 |
| | 29,025 |
| | (8,025 | ) | | 21,000 |
| | — |
| | 10/29/2001 | | Surf City Crossing | | 3,220 |
| | 52 |
| | 5,028 |
| | 2,655 |
| | 5,645 |
| | 8,300 |
| | (1,499 | ) | | 6,801 |
| | — |
| | 12/06/2006 | | Tates Creek Centre | | 4,802 |
| | 25,366 |
| | 1,543 |
| | 5,766 |
| | 25,945 |
| | 31,711 |
| | (7,289 | ) | | 24,422 |
| | — |
| | 03/01/2004 | | Taylorsville Town Center | | 2,179 |
| | 9,718 |
| | 945 |
| | 2,180 |
| | 10,662 |
| | 12,842 |
| | (3,242 | ) | | 9,600 |
| | — |
| | 12/19/2003 | | The Centre at Post Oak | | 13,731 |
| | 115 |
| | 23,705 |
| | 17,874 |
| | 19,677 |
| | 37,551 |
| | (11,113 | ) | | 26,438 |
| | — |
| | 12/31/1996 | | The Commons at Dexter Lake | | 2,923 |
| | 12,007 |
| | 2,297 |
| | 2,949 |
| | 14,278 |
| | 17,227 |
| | (4,639 | ) | | 12,588 |
| | — |
| | 11/13/2008 | | The Commons at Dexter Lake II | | 2,023 |
| | 6,940 |
| | 307 |
| | 2,039 |
| | 7,231 |
| | 9,270 |
| | (1,702 | ) | | 7,568 |
| | — |
| | 11/13/2008 |
Schedule III (Continued)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | | | | | Description | | Land | | | Building and
Improvements | | | Cost
Capitalized
Subsequent to
Acquisition | | | Land | | | Building and
Improvements | | | Total (1)(2) | | | Accumulated
Depreciation
(2) | | | Total Costs,
Net of
Accumulated
Depreciation | | | Encumbrances
(3) | | | Date of
Acquisition /
Construction | | Tropicana Beltway Center | | $ | 13,947 | | | $ | 42,186 | | | $ | 125 | | | $ | 13,949 | | | $ | 42,309 | | | $ | 56,258 | | | $ | (8,606) | | | $ | 47,652 | | | $ | (33,372) | | | | 11/20/2007 | | Tropicana Marketplace | | | 2,118 | | | | 8,477 | | | | (2,037) | | | | 1,266 | | | | 7,292 | | | | 8,558 | | | | (3,303) | | | | 5,255 | | | | - | | | | 07/24/1995 | | Tyler Shopping Center | | | 5 | | | | 21 | | | | 3,928 | | | | 300 | | | | 3,654 | | | | 3,954 | | | | (1,997) | | | | 1,957 | | | | - | | | | 12/31/2002 | | Uintah Gardens | | | 2,209 | | | | 13,051 | | | | 2,213 | | | | 2,205 | | | | 15,268 | | | | 17,473 | | | | (2,976) | | | | 14,497 | | | | - | | | | 12/22/2005 | | University Palms Shopping Ctr | | | 2,765 | | | | 10,181 | | | | 163 | | | | 2,765 | | | | 10,344 | | | | 13,109 | | | | (2,253) | | | | 10,856 | | | | (8,116) | | | | 11/13/2008 | | University Place | | | 500 | | | | 85 | | | | 789 | | | | 500 | | | | 874 | | | | 1,374 | | | | (206) | | | | 1,168 | | | | - | | | | 02/08/2008 | | Valley Shopping Center | | | 4,293 | | | | 13,736 | | | | 757 | | | | 8,170 | | | | 10,616 | | | | 18,786 | | | | (1,633) | | | | 17,153 | | | | - | | | | 04/07/2006 | | Valley View Shopping Center | | | 1,006 | | | | 3,980 | | | | 2,386 | | | | 1,006 | | | | 6,366 | | | | 7,372 | | | | (2,850) | | | | 4,522 | | | | - | | | | 11/20/1996 | | Venice Pines Shopping Center | | | 1,432 | | | | 5,730 | | | | 178 | | | | 1,077 | | | | 6,263 | | | | 7,340 | | | | (1,692) | | | | 5,648 | | | | - | | | | 06/06/2001 | | Village Arcade II Phase III | | | - | | | | 16 | | | | 15,743 | | | | - | | | | 15,759 | | | | 15,759 | | | | (8,144) | | | | 7,615 | | | | - | | | | 12/31/1996 | | Village Arcade-Phase II | | | - | | | | 787 | | | | 280 | | | | - | | | | 1,067 | | | | 1,067 | | | | (644) | | | | 423 | | | | - | | | | 12/31/1992 | | Vizcaya Square Shopping Center | | | 3,044 | | | | 12,226 | | | | 231 | | | | 3,044 | | | | 12,457 | | | | 15,501 | | | | (2,928) | | | | 12,573 | | | | - | | | | 12/18/2002 | | West Jordan Town Center | | | 4,306 | | | | 17,776 | | | | 1,726 | | | | 4,308 | | | | 19,500 | | | | 23,808 | | | | (4,026) | | | | 19,782 | | | | (13,301) | | | | 12/19/2003 | | Westchase Shopping Center | | | 3,085 | | | | 7,920 | | | | 6,380 | | | | 3,189 | | | | 14,196 | | | | 17,385 | | | | (11,413) | | | | 5,972 | | | | (8,304) | | | | 08/29/1978 | | Westgate Shopping Center | | | 245 | | | | 1,425 | | | | 451 | | | | 245 | | | | 1,876 | | | | 2,121 | | | | (1,655) | | | | 466 | | | | - | | | | 07/02/1965 | | Westhill Village Shopping Ctr. | | | 408 | | | | 3,002 | | | | 4,482 | | | | 437 | | | | 7,455 | | | | 7,892 | | | | (4,991) | | | | 2,901 | | | | - | | | | 05/01/1958 | | Westland Fair | | | 6,715 | | | | 10,506 | | | | 469 | | | | 4,357 | | | | 13,333 | | | | 17,690 | | | | (4,818) | | | | 12,872 | | | | - | | | | 12/29/2000 | | Westland Fair | | | 20,847 | | | | - | | | | (10,482) | | | | 7,863 | | | | 2,502 | | | | 10,365 | | | | (1,589) | | | | 8,776 | | | | - | | | | 12/29/2000 | | Westland Terrace Plaza | | | 1,649 | | | | 6,768 | | | | (4,226) | | | | 2,012 | | | | 2,179 | | | | 4,191 | | | | - | | | | 4,191 | | | | - | | | | 10/22/2003 | | Westminster Center | | | 11,215 | | | | 44,871 | | | | 5,707 | | | | 11,204 | | | | 50,589 | | | | 61,793 | | | | (14,431) | | | | 47,362 | | | | (44,835) | | | | 04/02/2001 | | Westminster Plaza | | | 1,759 | | | | 7,036 | | | | 445 | | | | 1,759 | | | | 7,481 | | | | 9,240 | | | | (1,852) | | | | 7,388 | | | | (6,488) | | | | 06/21/2002 | | Westwood Village Shopping Ctr. | | | - | | | | 6,968 | | | | 2,898 | | | | - | | | | 9,866 | | | | 9,866 | | | | (7,544) | | | | 2,322 | | | | - | | | | 08/25/1978 | | Whitehall Commons | | | 2,529 | | | | 6,901 | | | | 191 | | | | 2,522 | | | | 7,099 | | | | 9,621 | | | | (1,200) | | | | 8,421 | | | | (4,376) | | | | 10/06/2005 | | Winter Park Corners | | | 2,159 | | | | 8,636 | | | | 433 | | | | 2,159 | | | | 9,069 | | | | 11,228 | | | | (2,496) | | | | 8,732 | | | | - | | | | 09/06/2001 | | Wyoming Mall | | | 1,919 | | | | 7,678 | | | | 2,483 | | | | 598 | | | | 11,482 | | | | 12,080 | | | | (2,373) | | | | 9,707 | | | | - | | | | 03/31/1995 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 838,501 | | | | 2,424,711 | | | | 657,472 | | | | 829,861 | | | | 3,090,823 | | | | 3,920,684 | | | | (918,130) | | | | 3,002,554 | | | | (900,683) | | | | | | Industrial: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1625 Diplomat Drive | | | 506 | | | | 3,107 | | | | 122 | | | | 508 | | | | 3,227 | | | | 3,735 | | | | (519) | | | | 3,216 | | | | - | | | | 12/22/2005 | | 1801 Massaro | | | 865 | | | | 3,461 | | | | (55) | | | | 671 | | | | 3,600 | | | | 4,271 | | | | (795) | | | | 3,476 | | | | - | | | | 04/24/2003 | | 3550 Southside Industrial Pkwy | | | 449 | | | | 1,666 | | | | 134 | | | | 449 | | | | 1,800 | | | | 2,249 | | | | (333) | | | | 1,916 | | | | - | | | | 05/04/2004 | | Atlanta Industrial Park | | | 657 | | | | 2,626 | | | | 271 | | | | 479 | | | | 3,075 | | | | 3,554 | | | | (837) | | | | 2,717 | | | | - | | | | 02/19/2003 | | Beltway 8 at West Bellfort | | | 674 | | | | - | | | | 8,770 | | | | 784 | | | | 8,660 | | | | 9,444 | | | | (4,861) | | | | 4,583 | | | | - | | | | 12/31/2001 | | Blankenship Distribution Cntr. | | | 271 | | | | 1,097 | | | | 658 | | | | 273 | | | | 1,753 | | | | 2,026 | | | | (822) | | | | 1,204 | | | | - | | | | 08/07/1998 | | Braker 2 Business Center | | | 394 | | | | 1,574 | | | | 653 | | | | 394 | | | | 2,227 | | | | 2,621 | | | | (793) | | | | 1,828 | | | | - | | | | 09/28/2000 | | Brookhollow Business Center | | | 734 | | | | 2,938 | | | | 2,608 | | | | 736 | | | | 5,544 | | | | 6,280 | | | | (2,925) | | | | 3,355 | | | | - | | | | 07/27/1995 | | Central Plano Business Park | | | 1,343 | | | | 5,578 | | | | 930 | | | | 1,344 | | | | 6,507 | | | | 7,851 | | | | (1,397) | | | | 6,454 | | | | - | | | | 09/28/2005 | | ClayPoint Distribution Park | | | 2,413 | | | | 3,117 | | | | 13,920 | | | | 1,433 | | | | 18,017 | | | | 19,450 | | | | (4,120) | | | | 15,330 | | | | - | | | | 12/31/2010 | | Corporate Center Park | | | 1,027 | | | | 4,114 | | | | 2,905 | | | | 1,027 | | | | 7,019 | | | | 8,046 | | | | (3,371) | | | | 4,675 | | | | - | | | | 05/23/1997 | | Crosspoint Warehouse | | | 441 | | | | 1,762 | | | | 344 | | | | 441 | | | | 2,106 | | | | 2,547 | | | | (685) | | | | 1,862 | | | | - | | | | 12/23/1998 | | Crosswinds C&D | | | 650 | | | | 5,980 | | | | 400 | | | | 650 | | | | 6,380 | | | | 7,030 | | | | (306) | | | | 6,724 | | | | - | | | | 05/26/2010 | | Enterchange at Northlake A | | | 4,051 | | | | 7,804 | | | | 359 | | | | 1,624 | | | | 10,590 | | | | 12,214 | | | | (1,309) | | | | 10,905 | | | | (5,388) | | | | 04/20/2007 | | Enterchange at Walthall D | | | 3,190 | | | | 7,618 | | | | 7,917 | | | | 2,374 | | | | 16,351 | | | | 18,725 | | | | (2,563) | | | | 16,162 | | | | (6,595) | | | | 04/20/2007 | | Freeport Business Center | | | 3,196 | | | | 10,032 | | | | 1,425 | | | | 3,203 | | | | 11,450 | | | | 14,653 | | | | (2,109) | | | | 12,544 | | | | (7,040) | | | | 07/22/2005 | | Freeport Commerce Center | | | 598 | | | | 2,918 | | | | 698 | | | | 1,536 | | | | 2,678 | | | | 4,214 | | | | (685) | | | | 3,529 | | | | - | | | | 11/29/2006 | |
Schedule III
(Continued)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | | | | | Description | | Land | | | Building and
Improvements | | | Cost
Capitalized
Subsequent to
Acquisition | | | Land | | | Building and
Improvements | | | Total (1)(2) | | | Accumulated
Depreciation
(2) | | | Total Costs,
Net of
Accumulated
Depreciation | | | Encumbrances
(3) | | | Date of
Acquisition /
Construction | | Hopewell Industrial Center | | $ | 926 | | | $ | 8,074 | | | $ | 345 | | | $ | 2,740 | | | $ | 6,605 | | | $ | 9,345 | | | $ | (876) | | | $ | 8,469 | | | $ | (3,715) | | | | 11/03/2006 | | Houston Cold Storage Warehouse | | | 1,087 | | | | 4,347 | | | | 1,988 | | | | 1,072 | | | | 6,350 | | | | 7,422 | | | | (2,528) | | | | 4,894 | | | | - | | | | 06/12/1998 | | Interwest Business Park | | | 1,449 | | | | 5,795 | | | | 1,700 | | | | 1,461 | | | | 7,483 | | | | 8,944 | | | | (2,754) | | | | 6,190 | | | | - | | | | 12/22/2000 | | ISOM Business Center | | | 2,661 | | | | 6,699 | | | | 998 | | | | 2,662 | | | | 7,696 | | | | 10,358 | | | | (1,486) | | | | 8,872 | | | | - | | | | 10/24/2005 | | Jupiter Business Center | | | 588 | | | | 2,353 | | | | 1,027 | | | | 588 | | | | 3,380 | | | | 3,968 | | | | (1,571) | | | | 2,397 | | | | - | | | | 07/27/1999 | | Jupiter Business Park | | | 2,684 | | | | 6,097 | | | | 528 | | | | 2,684 | | | | 6,625 | | | | 9,309 | | | | (279) | | | | 9,030 | | | | - | | | | 08/10/2010 | | Kempwood Industrial Park | | | 734 | | | | 3,044 | | | | 147 | | | | 129 | | | | 3,796 | | | | 3,925 | | | | (1,484) | | | | 2,441 | | | | (2,482) | | | | 08/27/1996 | | Kennesaw 75 | | | 3,012 | | | | 7,659 | | | | 451 | | | | 3,007 | | | | 8,115 | | | | 11,122 | | | | (1,565) | | | | 9,557 | | | | (5,227) | | | | 02/23/2005 | | Lakeland Industrial Center | | | 3,265 | | | | 13,059 | | | | 1,894 | | | | 3,266 | | | | 14,952 | | | | 18,218 | | | | (4,939) | | | | 13,279 | | | | (12,394) | | | | 12/06/2001 | | Lakeland Interstate Bus. Park | | | 1,526 | | | | 9,077 | | | | (235) | | | | 547 | | | | 9,821 | | | | 10,368 | | | | (1,304) | | | | 9,064 | | | | (4,910) | | | | 01/11/2007 | | Manana / 35 Business Center | | | 1,323 | | | | 5,293 | | | | 2,816 | | | | 1,315 | | | | 8,117 | | | | 9,432 | | | | (3,188) | | | | 6,244 | | | | - | | | | 07/27/1999 | | McGraw Hill Distribution Ctr | | | 3,155 | | | | 18,906 | | | | 2 | | | | 3,157 | | | | 18,906 | | | | 22,063 | | | | (2,797) | | | | 19,266 | | | | - | | | | 02/14/2006 | | Midpoint I-20 Distrib. Center | | | 1,254 | | | | 7,070 | | | | 5,463 | | | | 2,820 | | | | 10,967 | | | | 13,787 | | | | (1,927) | | | | 11,860 | | | | - | | | | 10/13/2006 | | Midway Business Center | | | 1,078 | | | | 4,313 | | | | 1,865 | | | | 1,078 | | | | 6,178 | | | | 7,256 | | | | (2,646) | | | | 4,610 | | | | - | | | | 07/27/1999 | | Newkirk Business Center | | | 686 | | | | 2,745 | | | | 860 | | | | 686 | | | | 3,605 | | | | 4,291 | | | | (1,498) | | | | 2,793 | | | | - | | | | 07/27/1999 | | Northeast Crossing | | | 392 | | | | 1,568 | | | | 1,341 | | | | 350 | | | | 2,951 | | | | 3,301 | | | | (1,458) | | | | 1,843 | | | | - | | | | 07/27/1999 | | Oak Hill Business Park | | | 1,294 | | | | 5,279 | | | | 1,753 | | | | 1,299 | | | | 7,027 | | | | 8,326 | | | | (2,425) | | | | 5,901 | | | | - | | | | 10/18/2001 | | O’Connor Road Business Park | | | 1,028 | | | | 4,110 | | | | 1,396 | | | | 1,029 | | | | 5,505 | | | | 6,534 | | | | (1,919) | | | | 4,615 | | | | - | | | | 12/22/2000 | | Railwood | | | 7,072 | | | | 7,965 | | | | (1,297) | | | | 2,870 | | | | 10,870 | | | | 13,740 | | | | (4,834) | | | | 8,906 | | | | (6,302) | | | | 12/31/1975 | | Randol Mill Place | | | 371 | | | | 1,513 | | | | 760 | | | | 372 | | | | 2,272 | | | | 2,644 | | | | (1,113) | | | | 1,531 | | | | - | | | | 12/31/1998 | | Red Bird | | | 406 | | | | 1,622 | | | | 322 | | | | 406 | | | | 1,944 | | | | 2,350 | | | | (750) | | | | 1,600 | | | | - | | | | 09/29/1998 | | Regal Distribution Center | | | 801 | | | | 3,208 | | | | 1,609 | | | | 806 | | | | 4,812 | | | | 5,618 | | | | (1,742) | | | | 3,876 | | | | - | | | | 04/17/1998 | | Riverview Distribution Center | | | 1,518 | | | | 9,613 | | | | 257 | | | | 1,521 | | | | 9,867 | | | | 11,388 | | | | (1,226) | | | | 10,162 | | | | (3,234) | | | | 08/10/2007 | | Rutland 10 Business Center | | | 738 | | | | 2,951 | | | | 566 | | | | 739 | | | | 3,516 | | | | 4,255 | | | | (1,229) | | | | 3,026 | | | | - | | | | 09/28/2000 | | Sherman Plaza Business Park | | | 705 | | | | 2,829 | | | | 2,138 | | | | 710 | | | | 4,962 | | | | 5,672 | | | | (2,667) | | | | 3,005 | | | | - | | | | 04/01/1999 | | Southpark 3075 | | | 1,251 | | | | 8,385 | | | | 15 | | | | 1,213 | | | | 8,438 | | | | 9,651 | | | | (924) | | | | 8,727 | | | | - | | | | 10/03/2007 | | Southpark A, B, C | | | 1,079 | | | | 4,375 | | | | 1,129 | | | | 1,080 | | | | 5,503 | | | | 6,583 | | | | (1,828) | | | | 4,755 | | | | - | | | | 09/28/2000 | | Southpoint | | | 4,167 | | | | 10,967 | | | | 1,353 | | | | 4,168 | | | | 12,319 | | | | 16,487 | | | | (2,074) | | | | 14,413 | | | | - | | | | 12/29/2005 | | Southpoint Business Center | | | 597 | | | | 2,392 | | | | 1,176 | | | | 600 | | | | 3,565 | | | | 4,165 | | | | (1,462) | | | | 2,703 | | | | - | | | | 05/20/1999 | | Southport Business Park 5 | | | 562 | | | | 2,172 | | | | 1,425 | | | | 562 | | | | 3,597 | | | | 4,159 | | | | (1,469) | | | | 2,690 | | | | (2,584) | | | | 12/23/1998 | | Space Center Industrial Park | | | 1,036 | | | | 4,143 | | | | 1,844 | | | | 1,025 | | | | 5,998 | | | | 7,023 | | | | (2,274) | | | | 4,749 | | | | - | | | | 05/29/1998 | | Stonecrest Business Center | | | 601 | | | | 2,439 | | | | 1,941 | | | | 601 | | | | 4,380 | | | | 4,981 | | | | (2,243) | | | | 2,738 | | | | - | | | | 06/03/1997 | | Tampa East Ind. Portfolio | | | 5,424 | | | | 18,155 | | | | 1,486 | | | | 5,409 | | | | 19,656 | | | | 25,065 | | | | (3,380) | | | | 21,685 | | | | - | | | | 11/21/2005 | | Town and Country Commerce Ctr | | | 4,188 | | | | 9,628 | | | | (532) | | | | 4,311 | | | | 8,973 | | | | 13,284 | | | | (1,017) | | | | 12,267 | | | | (4,934) | | | | 06/29/2007 | | West Loop Bus Park - Freezer | | | 253 | | | | 3,593 | | | | (603) | | | | 76 | | | | 3,167 | | | | 3,243 | | | | (2,183) | | | | 1,060 | | | | - | | | | 09/13/1974 | | West Loop Commerce Center | | | 2,203 | | | | 1,672 | | | | (496) | | | | 527 | | | | 2,852 | | | | 3,379 | | | | (2,429) | | | | 950 | | | | - | | | | 12/14/1981 | | West-10 Business Center | | | - | | | | 3,125 | | | | 2,595 | | | | - | | | | 5,720 | | | | 5,720 | | | | (4,425) | | | | 1,295 | | | | - | | | | 08/28/1992 | | West-10 Business Center II | | | 414 | | | | 1,662 | | | | 1,221 | | | | 389 | | | | 2,908 | | | | 3,297 | | | | (1,345) | | | | 1,952 | | | | - | | | | 08/20/1997 | | Westgate Business Center | | | 1,472 | | | | 3,471 | | | | 2,591 | | | | 1,470 | | | | 6,064 | | | | 7,534 | | | | (2,209) | | | | 5,325 | | | | - | | | | 12/12/2003 | | Westlake 125 | | | 1,174 | | | | 6,630 | | | | 230 | | | | 1,066 | | | | 6,968 | | | | 8,034 | | | | (829) | | | | 7,205 | | | | - | | | | 10/03/2007 | | Wirt Road & I10 | | | 1,003 | | | | - | | | | 45 | | | | 1,048 | | | | - | | | | 1,048 | | | | - | | | | 1,048 | | | | - | | | | 05/24/2007 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 86,636 | | | | 293,390 | | | | 86,173 | | | | 78,785 | | | | 387,414 | | | | 466,199 | | | | (108,726) | | | | 357,473 | | | | (64,805) | | | | | |
Schedule III
(Continued)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | | | | | Description | | Land | | | Building and
Improvements | | | Cost
Capitalized
Subsequent to
Acquisition | | | Land | | | Building and
Improvements | | | Total (1)(2) | | | Accumulated
Depreciation (2) | | | Total Costs,
Net of
Accumulated
Depreciation | | | Encumbrances
(3) | | | Date of
Acquisition /
Construction | | Other: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1919 North Loop West | | $ | 1,334 | | | $ | 8,451 | | | $ | 11,224 | | | $ | 1,337 | | | $ | 19,672 | | | $ | 21,009 | | | $ | (5,033) | | | $ | 15,976 | | | $ | - | | | | 12/05/2006 | | Citadel Building | | | 3,236 | | | | 6,168 | | | | 7,827 | | | | 534 | | | | 16,697 | | | | 17,231 | | | | (13,134) | | | | 4,097 | | | | - | | | | 12/30/1975 | | Phoenix Office Building | | | 1,696 | | | | 3,255 | | | | 965 | | | | 1,773 | | | | 4,143 | | | | 5,916 | | | | (722) | | | | 5,194 | | | | - | | | | 01/31/2007 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 6,266 | | | | 17,874 | | | | 20,016 | | | | 3,644 | | | | 40,512 | | | | 44,156 | | | | (18,889) | | | | 25,267 | | | | - | | | | | | Land Held/Under Development: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Ambassador Parcel D- Land | | | 98 | | | | - | | | | - | | | | 98 | | | | - | | | | 98 | | | | - | | | | 98 | | | | - | | | | 10/26/2007 | | Citadel Drive at Loop 610 | | | 3,747 | | | | - | | | | (239) | | | | 3,508 | | | | - | | | | 3,508 | | | | - | | | | 3,508 | | | | - | | | | 12/30/1975 | | Crabtree Towne Center | | | 18,810 | | | | 54 | | | | (8,636) | | | | 10,219 | | | | 9 | | | | 10,228 | | | | - | | | | 10,228 | | | | - | | | | 01/31/2007 | | Cullen Blvd. at East Orem-Land | | | 172 | | | | - | | | | (122) | | | | 50 | | | | - | | | | 50 | | | | - | | | | 50 | | | | - | | | | 02/24/1975 | | Curry Ford Road | | | 1,878 | | | | 7 | | | | (14) | | | | 1,870 | | | | 1 | | | | 1,871 | | | | - | | | | 1,871 | | | | - | | | | 10/05/2007 | | Dacula Market | | | 1,353 | | | | 104 | | | | 2,021 | | | | 1,411 | | | | 2,067 | | | | 3,478 | | | | - | | | | 3,478 | | | | - | | | | 05/12/2011 | | Decatur 215 | | | 32,525 | | | | 8,200 | | | | (27,968) | | | | 11,612 | | | | 1,145 | | | | 12,757 | | | | - | | | | 12,757 | | | | - | | | | 12/26/2007 | | Festival Plaza | | | 751 | | | | 6 | | | | 156 | | | | 912 | | | | 1 | | | | 913 | | | | - | | | | 913 | | | | - | | | | 12/08/2006 | | Gladden Farms | | | 1,619 | | | | 4 | | | | (155) | | | | 1,385 | | | | 83 | | | | 1,468 | | | | - | | | | 1,468 | | | | - | | | | 08/21/2007 | | Hilltop Village Center | | | 3,196 | | | | 7,234 | | | | 701 | | | | 3,307 | | | | 7,824 | | | | 11,131 | | | | - | | | | 11,131 | | | | - | | | | 11/17/2011 | | Mainland Mall- 1 & 2-Land | | | 321 | | | | - | | | | (86) | | | | 235 | | | | - | | | | 235 | | | | - | | | | 235 | | | | - | | | | 11/29/1967 | | Mohave Crossroads | | | 1,080 | | | | - | | | | 571 | | | | 1,516 | | | | 135 | | | | 1,651 | | | | - | | | | 1,651 | | | | - | | | | 06/12/2007 | | North Towne Plaza | | | 6,646 | | | | 99 | | | | 5,259 | | | | 7,193 | | | | 4,811 | | | | 12,004 | | | | (255) | | | | 11,749 | | | | - | | | | 12/27/2006 | | NW Freeway at Gessner- Land | | | 5,052 | | | | - | | | | (4,218) | | | | 834 | | | | - | | | | 834 | | | | - | | | | 834 | | | | - | | | | 11/16/1972 | | Palm Coast Center- Land | | | 2,101 | | | | 18 | | | | (1,334) | | | | 779 | | | | 6 | | | | 785 | | | | - | | | | 785 | | | | - | | | | 04/13/2011 | | Ridgeway Trace | | | 26,629 | | | | 544 | | | | 19,401 | | | | 16,369 | | | | 30,205 | | | | 46,574 | | | | (2,235) | | | | 44,339 | | | | - | | | | 11/09/2006 | | River Point at Sheridan | | | 28,898 | | | | 4,042 | | | | 1,035 | | | | 15,664 | | | | 18,311 | | | | 33,975 | | | | (1,529) | | | | 32,446 | | | | (6,720) | | | | 04/01/2010 | | River Pointe Venture | | | 2,874 | | | | - | | | | (2,063) | | | | 811 | | | | - | | | | 811 | | | | - | | | | 811 | | | | - | | | | 08/04/2004 | | Rock Prairie Marketplace | | | 2,364 | | | | - | | | | (976) | | | | 1,388 | | | | - | | | | 1,388 | | | | - | | | | 1,388 | | | | - | | | | 05/15/2006 | | Shreveport | | | 356 | | | | - | | | | (112) | | | | 244 | | | | - | | | | 244 | | | | - | | | | 244 | | | | - | | | | 05/22/1973 | | South Fulton Crossing | | | 14,373 | | | | 154 | | | | (10,968) | | | | 3,100 | | | | 459 | | | | 3,559 | | | | (1) | | | | 3,558 | | | | - | | | | 01/10/2007 | | Stanford Court | | | 693 | | | | - | | | | (303) | | | | 390 | | | | - | | | | 390 | | | | - | | | | 390 | | | | - | | | | 04/20/1981 | | Stevens Ranch | | | 36,939 | | | | 46 | | | | (7,803) | | | | 29,178 | | | | 4 | | | | 29,182 | | | | - | | | | 29,182 | | | | - | | | | 05/16/2007 | | Surf City Crossing | | | 3,220 | | | | 52 | | | | 7,480 | | | | 5,421 | | | | 5,331 | | | | 10,752 | | | | (245) | | | | 10,507 | | | | - | | | | 12/06/2006 | | The Shoppes @ Wilderness Oaks | | | 11,081 | | | | 50 | | | | 1,461 | | | | 12,586 | | | | 6 | | | | 12,592 | | | | - | | | | 12,592 | | | | - | | | | 06/19/2008 | | The Shoppes at Caveness Farms | | | 7,235 | | | | 135 | | | | (703) | | | | 6,488 | | | | 179 | | | | 6,667 | | | | - | | | | 6,667 | | | | - | | | | 01/17/2006 | | The Shoppes at Parkwood Ranch | | | 1,236 | | | | - | | | | 51 | | | | 1,259 | | | | 28 | | | | 1,287 | | | | - | | | | 1,287 | | | | - | | | | 01/02/2007 | | Tomball Marketplace | | | 9,616 | | | | 262 | | | | 18,816 | | | | 8,600 | | | | 20,094 | | | | 28,694 | | | | (1,806) | | | | 26,888 | | | | - | | | | 04/12/2006 | | Undev. Land Epic | | | 1,980 | | | | - | | | | 799 | | | | 2,649 | | | | 130 | | | | 2,779 | | | | - | | | | 2,779 | | | | - | | | | 04/09/2008 | | Village Shopping Center | | | 64 | | | | 714 | | | | (689) | | | | 89 | | | | - | | | | 89 | | | | - | | | | 89 | | | | - | | | | 12/31/2002 | | Waterford Village | | | 5,830 | | | | - | | | | 9,225 | | | | 5,215 | | | | 9,840 | | | | 15,055 | | | | (2,029) | | | | 13,026 | | | | - | | | | 06/11/2004 | | West 11th @ Loop 610 | | | 1,667 | | | | - | | | | 8 | | | | 1,675 | | | | - | | | | 1,675 | | | | - | | | | 1,675 | | | | - | | | | 12/14/1981 | | Westover Square | | | 4,435 | | | | 20 | | | | (1,174) | | | | 3,281 | | | | - | | | | 3,281 | | | | - | | | | 3,281 | | | | - | | | | 08/01/2006 | | Westwood Center | | | 10,497 | | | | 36 | | | | 7,282 | | | | 6,018 | | | | 11,797 | | | | 17,815 | | | | (1,301) | | | | 16,514 | | | | - | | | | 01/26/2007 | | Whole Foods @ Carrollwood | | | 2,772 | | | | 126 | | | | 397 | | | | 2,870 | | | | 425 | | | | 3,295 | | | | - | | | | 3,295 | | | | - | | | | 09/30/2011 | | Wilcrest/Bissonnet-Land | | | 7,228 | | | | - | | | | (7,019) | | | | 209 | | | | - | | | | 209 | | | | - | | | | 209 | | | | - | | | | 11/10/1980 | | York Plaza | | | 162 | | | | - | | | | (45) | | | | 117 | | | | - | | | | 117 | | | | - | | | | 117 | | | | - | | | | 08/28/1972 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 259,498 | | | | 21,907 | | | | 36 | | | | 168,550 | | | | 112,891 | | | | 281,441 | | | | (9,401) | | | | 272,040 | | | | (6,720) | | | | | | Balance of Portfolio (not to exceed 5% of total) | | | 320 | | | | 10 | | | | 70,477 | | | | 6,681 | | | | 64,126 | | | | 70,807 | | | | (25,905) | | | | 44,902 | | | | - | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Total of Portfolio | | $ | 1,191,221 | | | $ | 2,757,892 | | | $ | 834,174 | | | $ | 1,087,521 | | | $ | 3,695,766 | | | $ | 4,783,287 | | | $ | (1,081,051) | | | $ | 3,702,236 | | | $ | (972,208) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | | | Gross Amounts Carried at Close of Period | | | | | | | | | | Description | | Land | | Building and Improvements | | Cost Capitalized Subsequent to Acquisition | | Land | | Building and Improvements | | Total (1) | | Accumulated Depreciation | | Total Costs, Net of Accumulated Depreciation | | Encumbrances (2) | | Date of Acquisition / Construction | | The Shoppes at Parkwood Ranch | | $ | 4,369 |
| | $ | 52 |
| | $ | 10,200 |
| | $ | 2,347 |
| | $ | 12,274 |
| | $ | 14,621 |
| | $ | (4,917 | ) | | $ | 9,704 |
| | $ | — |
| | 12/31/2009 | | Thompson Bridge Commons | | 604 |
| | — |
| | 625 |
| | 513 |
| | 716 |
| | 1,229 |
| | (76 | ) | | 1,153 |
| | — |
| | 04/26/2005 | | Thousand Oaks Shopping Center | | 2,973 |
| | 13,142 |
| | 372 |
| | 2,973 |
| | 13,514 |
| | 16,487 |
| | (4,300 | ) | | 12,187 |
| | (13,670 | ) | | 03/20/2008 | | TJ Maxx Plaza | | 3,400 |
| | 19,283 |
| | 1,716 |
| | 3,430 |
| | 20,969 |
| | 24,399 |
| | (6,217 | ) | | 18,182 |
| | — |
| | 03/01/2004 | | Tomball Marketplace | | 9,616 |
| | 262 |
| | 22,837 |
| | 8,132 |
| | 24,583 |
| | 32,715 |
| | (6,364 | ) | | 26,351 |
| | — |
| | 04/12/2006 | | Town & Country Shopping Center | | — |
| | 3,891 |
| | 5,237 |
| | — |
| | 9,128 |
| | 9,128 |
| | (6,004 | ) | | 3,124 |
| | — |
| | 01/31/1989 | | Tropicana Beltway Center | | 13,947 |
| | 42,186 |
| | 632 |
| | 13,949 |
| | 42,816 |
| | 56,765 |
| | (12,524 | ) | | 44,241 |
| | — |
| | 11/20/2007 | | Tropicana Marketplace | | 2,118 |
| | 8,477 |
| | (2,133 | ) | | 1,206 |
| | 7,256 |
| | 8,462 |
| | (3,756 | ) | | 4,706 |
| | — |
| | 07/24/1995 | | Tyler Shopping Center | | 5 |
| | 21 |
| | 3,996 |
| | 300 |
| | 3,722 |
| | 4,022 |
| | (2,441 | ) | | 1,581 |
| | — |
| | 12/31/2002 | | Valley Plaza | | 1,414 |
| | 5,818 |
| | 6,478 |
| | 1,422 |
| | 12,288 |
| | 13,710 |
| | (5,464 | ) | | 8,246 |
| | — |
| | 12/31/1997 | | Valley Shopping Center | | 4,293 |
| | 13,736 |
| | 835 |
| | 8,170 |
| | 10,694 |
| | 18,864 |
| | (2,601 | ) | | 16,263 |
| | — |
| | 04/07/2006 | | Valley View Shopping Center | | 1,006 |
| | 3,980 |
| | 2,362 |
| | 1,006 |
| | 6,342 |
| | 7,348 |
| | (3,374 | ) | | 3,974 |
| | — |
| | 11/20/1996 | | Vizcaya Square Shopping Center | | 3,044 |
| | 12,226 |
| | 1,343 |
| | 3,044 |
| | 13,569 |
| | 16,613 |
| | (4,093 | ) | | 12,520 |
| | — |
| | 12/18/2002 | | Waterford Village | | 5,830 |
| | — |
| | 8,103 |
| | 2,893 |
| | 11,040 |
| | 13,933 |
| | (4,386 | ) | | 9,547 |
| | — |
| | 06/11/2004 | | West Jordan Town Center | | 4,306 |
| | 17,776 |
| | 1,760 |
| | 4,308 |
| | 19,534 |
| | 23,842 |
| | (5,662 | ) | | 18,180 |
| | — |
| | 12/19/2003 | | Westchase Shopping Center | | 3,085 |
| | 7,920 |
| | 7,006 |
| | 3,189 |
| | 14,822 |
| | 18,011 |
| | (12,124 | ) | | 5,887 |
| | (936 | ) | | 08/29/1978 | | Westgate Shopping Center | | 245 |
| | 1,425 |
| | 463 |
| | 239 |
| | 1,894 |
| | 2,133 |
| | (1,606 | ) | | 527 |
| | — |
| | 07/02/1965 | | Westhill Village Shopping Center | | 408 |
| | 3,002 |
| | 4,574 |
| | 437 |
| | 7,547 |
| | 7,984 |
| | (5,149 | ) | | 2,835 |
| | — |
| | 05/01/1958 | | Westland Fair | | 27,562 |
| | 10,506 |
| | (9,160 | ) | | 12,220 |
| | 16,688 |
| | 28,908 |
| | (8,118 | ) | | 20,790 |
| | — |
| | 12/29/2000 | | Westminster Center | | 11,215 |
| | 44,871 |
| | 7,692 |
| | 11,204 |
| | 52,574 |
| | 63,778 |
| | (19,286 | ) | | 44,492 |
| | (42,237 | ) | | 04/02/2001 | | Whitehall Commons | | 2,529 |
| | 6,901 |
| | 449 |
| | 2,522 |
| | 7,357 |
| | 9,879 |
| | (1,915 | ) | | 7,964 |
| | — |
| | 10/06/2005 | | Whole Foods @ Carrollwood | | 2,772 |
| | 126 |
| | 4,634 |
| | 2,854 |
| | 4,678 |
| | 7,532 |
| | (440 | ) | | 7,092 |
| | — |
| | 09/30/2011 | | Winter Park Corners | | 2,159 |
| | 8,636 |
| | 1,317 |
| | 2,159 |
| | 9,953 |
| | 12,112 |
| | (3,504 | ) | | 8,608 |
| | — |
| | 09/06/2001 | | | | 861,144 |
| | 2,219,059 |
| | 753,888 |
| | 822,571 |
| | 3,011,520 |
| | 3,834,091 |
| | (1,000,692 | ) | | 2,833,399 |
| | (562,570 | ) | | | | New Development: | | | | | | | | | | | | | | | | | | | | | | Hilltop Village Center | | 3,196 |
| | 7,234 |
| | 40,890 |
| | 4,113 |
| | 47,207 |
| | 51,320 |
| | (568 | ) | | 50,752 |
| | — |
| | 11/17/2011 | | Nottingham Commons | | 19,523 |
| | 2,398 |
| | 345 |
| | 19,771 |
| | 2,495 |
| | 22,266 |
| | (3 | ) | | 22,263 |
| | — |
| | 09/24/2014 | | Wake Forest Crossing II | | 3,155 |
| | 2,617 |
| | 1,149 |
| | 3,276 |
| | 3,645 |
| | 6,921 |
| | — |
| | 6,921 |
| | — |
| | 06/04/2014 | | | | 25,874 |
| | 12,249 |
| | 42,384 |
| | 27,160 |
| | 53,347 |
| | 80,507 |
| | (571 | ) | | 79,936 |
| | — |
| | | | Miscellaneous (not to exceed 5% of total) | | 141,767 |
| | 9,263 |
| | 10,466 |
| | 99,529 |
| | 61,967 |
| | 161,496 |
| | (27,356 | ) | | 134,140 |
| | — |
| | | | Total of Portfolio | | $ | 1,028,785 |
| | $ | 2,240,571 |
| | $ | 806,738 |
| | $ | 949,260 |
| | $ | 3,126,834 |
| | $ | 4,076,094 |
| | $ | (1,028,619 | ) | | $ | 3,047,475 |
| | $ | (562,570 | ) | | |
___________________ | | | (1) | The tax basisbook value of our net fixed asset exceeds the book valuetax basis by approximately $37$32.0 million at December 31, 2011.2014. |
| | | (2) | Totals include property held for sale at December 31, 2011.
|
(3) | Encumbrances do not include $38.6$28.1 million outstanding under fixed-rate mortgage debt associated with fivethree properties each held in a tenancy-in-common arrangement and $10.1$4.3 million of non-cash debt related items. |
Depreciation is computed using the straight-line method, generally over estimated useful lives of 18-4018-40 years for buildings and 10-2010-20 years for parking lot surfacing and equipment. Tenant and leasehold improvements are depreciated over the remaining life of the lease or the useful life whichever is shorter. The changes in total cost of the properties were as follows (in thousands): | | | | | | | | | | | | | | | | Year Ended December 31, | | | | | 2011 | | | 2010 | | | 2009 | | Balance at beginning of year | | $ | 4,777,794 | | | $ | 4,658,396 | | | $ | 4,915,472 | | Additions at cost | | | 180,956 | | | | 195,499 | | | | 97,557 | | Retirements or sales | | | (123,252) | | | | (70,924) | | | | (316,910) | | Property held for sale | | | (94,761) | | | | - | | | | - | | Impairment loss | | | (52,211) | | | | (5,177) | | | | (37,723) | | | | | | | | | | | | | | | | | | | Balance at end of year | | $ | 4,688,526 | | | $ | 4,777,794 | | | $ | 4,658,396 | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | Year Ended December 31, | | | 2014 | | 2013 | | 2012 | | Balance at beginning of year | $ | 4,289,276 |
| | $ | 4,399,850 |
| | $ | 4,688,526 |
| | Additions at cost | 144,474 |
| | 279,624 |
| | 310,454 |
| | Retirements or sales | (348,221 | ) | | (232,823 | ) | | (608,466 | ) | | Property held for sale | (9,435 | ) | | (155,017 | ) | | — |
| | Property transferred from held for sale | — |
| | — |
| | 18,090 |
| | Impairment loss | — |
| | (2,358 | ) | | (8,754 | ) | | Balance at end of year | $ | 4,076,094 |
| | $ | 4,289,276 |
| | $ | 4,399,850 |
|
The changes in accumulated depreciation were as follows (in thousands): | | | 00000000 | | | | 00000000 | | | | 00000000 | | | | | Year Ended December 31, | | | | | 2011 | | | 2010 | | | 2009 | | Balance at beginning of year | | $ | 971,249 | | | $ | 856,281 | | | $ | 812,323 | | Additions at cost | | | 133,220 | | | | 127,238 | | | | 123,062 | | Retirements or sales | | | (23,418) | | | | (12,270) | | | | (79,104) | | Property held for sale | | | (21,520) | | | | - | | | | - | | | | | | | | | | | | | | | | | | | Balance at end of year | | $ | 1,059,531 | | | $ | 971,249 | | | $ | 856,281 | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | Year Ended December 31, | | | 2014 | | 2013 | | 2012 | | Balance at beginning of year | $ | 1,058,040 |
| | $ | 1,040,839 |
| | $ | 1,059,531 |
| | Additions at cost | 125,226 |
| | 130,698 |
| | 130,965 |
| | Retirements or sales | (148,882 | ) | | (81,094 | ) | | (157,723 | ) | | Property held for sale | (5,765 | ) | | (32,403 | ) | | — |
| | Property transferred from held for sale | — |
| | — |
| | 8,066 |
| | Balance at end of year | $ | 1,028,619 |
| | $ | 1,058,040 |
| | $ | 1,040,839 |
|
WEINGARTEN REALTY INVESTORS MORTGAGE LOANS ON REAL ESTATE (Amounts in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | State | | | Interest
Rate | | Final
Maturity
Date | | Periodic
Payment
Terms | | Face
Amount of
Mortgages | | | Carrying
Amount of
Mortgages
(1) | | | Principal
Amount of
Loans
Subject to
Delinquent
Principal or
Interest | | SHOPPING CENTERS: | | | | | | | | | | | | | | | | | | | | | | | FIRST MORTGAGES: | | | | | | | | | | | | | | | | | | | | | | | 363-410 Burma, LLC | | | TN | | | 6.50% | | 12-01-2012 | | $213 Annual
P&I | | $ | 2,353 | | | $ | 2,353 | | | | - | | WRI-SRP Cole Park Plaza, LLC | | | NC | | | 5.66% | | 03-31-2012 | | At Maturity | | | 6,200 | | | | 6,200 | | | | - | | College Park Realty Company | | | NV | | | 7.00% | | 10-31-2053 | | At Maturity | | | 3,410 | | | | 3,410 | | | | - | | American National Insurance Company | | | TX | | | 5.95% | | 01-01-2014 | | $136 Annual
P&I | | | 1,455 | | | | 1,455 | | | | - | | SHOPPING CENTERS: | | | | | | | | | | | | | | | | | | | | | | | CONSTRUCTION LOANS: | | | | | | | | | | | | | | | | | | | | | | | WRI Alliance Riley Venture-Tranche A | | | CA | | | 5.53% | | 01-01-2013 | | $4,200
Annual P&I | | | 56,514 | | | | 56,514 | | | | - | | WRI Alliance Riley Venture-Tranche B | | | CA | | | 10.00% | | 01-01-2013 | | $204 Annual
P&I | | | 1,404 | | | | 1,404 | | | | - | | Weingarten I-4 Clermont
Landing, LLC | | | FL | | | 2.95% | | 06-30-2014 | | $803 Annual
P&I | | | 13,594 | | | | 13,594 | | | | - | | Weingarten Miller Buckingham, LLC (2) | | | CO | | | 2.75% | | 02-21-2012 | | At Maturity | | | 17,809 | | | | 17,809 | | | | - | | Weingarten Miller Equiwest Salt Lake, LLC | | | UT | | | 2.75% | | 03-24-2012 | | At Maturity | | | 15,940 | | | | 15,940 | | | | - | | Weingarten Miller MDH Buckingham, LLC (2) | | | CO | | | 2.75% | | 02-21-2012 | | At Maturity | | | 41,237 | | | | 41,237 | | | | - | | | | | | | | | | | | | | | | | | | | | | | | | TOTAL MORTGAGE LOANS ON REAL ESTATE | | | | | | | | | | | | $ | 159,916 | | | $ | 159,916 | | | $ | - | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | State | | Interest Rate | | Final Maturity Date | | Periodic Payment Terms | | Face Amount of Mortgages | | Carrying Amount of Mortgages (1) | | Shopping Centers: | | | | | | | | | | | | | First Mortgages: | | | | | | | | | | | | | College Park Realty Company | NV | | 7.00% | | 10/31/2053 | | At Maturity | | $ | 3,410 |
| | $ | 3,410 |
| Total Mortgage Loans on Real Estate | | | | | | | | | $ | 3,410 |
| | $ | 3,410 |
|
___________________ | | | (1) | The aggregate cost at December 31, 20112014 for federal income tax purposes is $159,916,$3.4 million, and there are no prior liens to be disclosed. |
| (2) | In February 2012, these loans were paid. See Note 5 for additional information.
|
Changes in mortgage loans are summarized below (in thousands): | | | | | | | | | | | | | | | | Year Ended December 31, | | | | | 2011 | | | 2010 | | | 2009 | | Balance, Beginning of Year | | $ | 192,092 | | | $ | 267,222 | | | $ | 236,743 | | New Loans | | | - | | | | 4,912 | | | | - | | Additions to Existing Loans (1) | | | 4,161 | | | | 11,961 | | | | 54,007 | | Collections/Reductions of Principal | | | (14,464) | | | | (20,124) | | | | (23,528) | | Reduction of Principal due to Business Combination (2) | | | (21,873) | | | | (71,879) | | | | - | | | | | | | | | | | | | | | Balance, End of Year | | $ | 159,916 | | | $ | 192,092 | | | $ | 267,222 | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | Year Ended December 31, | | | 2014 | | 2013 | | 2012 | | Balance, Beginning of Year | $ | 15,438 |
| | $ | 91,662 |
| | $ | 159,916 |
| Additions to Existing Loans (1) | — |
| | 699 |
| | 734 |
| | Collections/Reductions of Principal | (12,028 | ) | | (22,085 | ) | | (68,988 | ) | Reduction of Principal due to Business Combinations (2) | — |
| | (54,838 | ) | | — |
| | Balance, End of Year | $ | 3,410 |
| | $ | 15,438 |
| | $ | 91,662 |
|
___________________ | | | (1) | The caption above, “Additions to Existing Loans” also includes accrued interest. |
| | | (2) | Effective April 13, 2011, weThis caption relates to acquired our partner’s 50% interest in an unconsolidated real estate joint venture related to a development property in Palm Coast, Florida. Effective April 1, 2010, we assumed control of two 50%-owned unconsolidated real estate joint ventures related to a development project in Sheridan, Colorado, which had previously been accounted for under the equity method. The notes associated with these transactions are reported as a reduction in the preceding table forinterest during the respective years. See Note 23 for additional information.
period. |
112
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