Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Nov. 05, 2014 | |
Document And Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Trading Symbol | 'GTY | ' |
Entity Registrant Name | 'GETTY REALTY CORP /MD/ | ' |
Entity Central Index Key | '0001052752 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 33,416,873 |
Consolidated_Balance_Sheets_un
Consolidated Balance Sheets (unaudited) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Real Estate: | ' | ' |
Land | $344,537 | $342,944 |
Buildings and improvements | 196,775 | 196,607 |
Total Real Estate | 541,312 | 539,551 |
Less-accumulated depreciation and amortization | -99,547 | -95,712 |
Real estate held for use, net | 441,765 | 443,839 |
Real estate held for sale, net | 9,672 | 22,984 |
Real estate, net | 451,437 | 466,823 |
Net investment in direct financing leases | 96,143 | 97,147 |
Deferred rent receivable (net of allowance of $6,343 at September 30, 2014 and $4,775 at December 31, 2013) | 20,605 | 16,893 |
Cash and cash equivalents | 8,396 | 12,035 |
Restricted cash | 463 | 1,000 |
Notes and mortgages receivable | 32,901 | 28,793 |
Accounts receivable (net of allowance of $3,982 at September 30, 2014 and $3,248 at December 31, 2013) | 4,446 | 5,106 |
Prepaid expenses and other assets | 36,776 | 54,605 |
Total assets | 651,167 | 682,402 |
LIABILITIES AND SHAREHOLDERS' EQUITY: | ' | ' |
Borrowings under credit lines | 27,000 | 58,000 |
Term loan | 100,000 | 100,000 |
Mortgage payable, net | 341 | ' |
Environmental remediation obligations | 42,320 | 43,472 |
Dividends payable | 6,750 | 8,423 |
Accounts payable and accrued liabilities | 52,746 | 57,416 |
Total liabilities | 229,157 | 267,311 |
Commitments and contingencies (notes 2, 3, 4 and 5) | ' | ' |
Shareholders' equity: | ' | ' |
Common stock, par value $.01 per share; authorized 50,000,000 shares; issued 33,416,873 at September 30, 2014 and 33,397,260 at December 31, 2013 | 334 | 334 |
Paid-in capital | 463,058 | 462,397 |
Dividends paid in excess of earnings | -41,382 | -47,640 |
Total shareholders' equity | 422,010 | 415,091 |
Total liabilities and shareholders' equity | $651,167 | $682,402 |
Consolidated_Balance_Sheets_un1
Consolidated Balance Sheets (unaudited) (Parenthetical) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ' | ' |
Allowance on deferred rent receivable | $6,343 | $4,775 |
Allowance on accounts receivable | $3,982 | $3,248 |
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 33,416,873 | 33,397,260 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Revenues: | ' | ' | ' | ' |
Revenues from rental properties | $24,014 | $24,692 | $71,911 | $70,136 |
Interest on notes and mortgages receivable | 817 | 707 | 2,287 | 2,467 |
Other revenue (note 2) | ' | 3,126 | ' | 3,126 |
Total revenues | 24,831 | 28,525 | 74,198 | 75,729 |
Operating expenses: | ' | ' | ' | ' |
Rental property expenses | 5,538 | 7,085 | 17,420 | 21,525 |
Impairment charges | 872 | 336 | 1,462 | 1,162 |
Environmental expenses | 1,171 | 6,133 | 3,752 | 8,584 |
General and administrative expenses | 3,865 | 6,361 | 11,984 | 16,750 |
Allowance for uncollectible accounts/(recoveries) | 38 | -10,478 | 2,246 | -14,460 |
Depreciation and amortization expense | 3,372 | 2,377 | 8,034 | 6,921 |
Total operating expenses | 14,856 | 11,814 | 44,898 | 40,482 |
Operating income | 9,975 | 16,711 | 29,300 | 35,247 |
Gains on dispositions of real estate | 1,389 | ' | 1,389 | ' |
Other income | 48 | 45 | 216 | 79 |
Interest expense | -2,416 | -3,074 | -7,430 | -8,966 |
Earnings from continuing operations | 8,996 | 13,682 | 23,475 | 26,360 |
Discontinued operations: | ' | ' | ' | ' |
Earnings (loss) from operating activities | -1,518 | 1,220 | -4,092 | -975 |
Gains on dispositions of real estate | 2,757 | 26,975 | 7,127 | 39,581 |
Earnings from discontinued operations | 1,239 | 28,195 | 3,035 | 38,606 |
Net earnings | $10,235 | $41,877 | $26,510 | $64,966 |
Basic and diluted earnings per common share: | ' | ' | ' | ' |
Earnings from continuing operations | $0.26 | $0.41 | $0.70 | $0.79 |
Earnings from discontinued operations | $0.04 | $0.84 | $0.09 | $1.15 |
Net earnings | $0.30 | $1.25 | $0.79 | $1.94 |
Weighted average shares outstanding: | ' | ' | ' | ' |
Basic | 33,417 | 33,397 | 33,406 | 33,397 |
Stock options | ' | ' | ' | ' |
Diluted | 33,417 | 33,397 | 33,406 | 33,397 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (unaudited) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
CASH FLOWS FROM OPERATING ACTIVITIES: | ' | ' |
Net earnings | $26,510 | $64,966 |
Depreciation and amortization expense: | ' | ' |
Continuing operations | 8,034 | 6,921 |
Discontinued operations | ' | 577 |
Impairment charges | 6,583 | 7,717 |
Gains on dispositions of real estate: | ' | ' |
Continuing operations | -1,389 | ' |
Discontinued operations | -7,127 | -39,581 |
Deferred rent receivable, net of allowance | -3,712 | -5,117 |
Bad debt expense (recoveries) | 840 | -21,006 |
Other | 3,382 | 4,391 |
Changes in assets and liabilities: | ' | ' |
Accounts receivable | -338 | 22,184 |
Prepaid expenses and other assets | 3,566 | 102 |
Environmental remediation obligations | -9,953 | -10,358 |
Accounts payable and accrued liabilities | -3,995 | 8,005 |
Net cash flow provided by operating activities | 22,401 | 38,801 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ' | ' |
Property acquisitions and capital expenditures | -6,437 | -67,086 |
Investment in direct financing leases | ' | -6,267 |
Proceeds from dispositions of real estate: | ' | ' |
Continuing operations | 4,380 | ' |
Discontinued operations | 12,705 | 51,276 |
Change in cash held for property acquisitions | 12,956 | -6,880 |
Change in restricted cash | 537 | ' |
Issuance of notes and mortgages receivables | ' | -4,138 |
Collection of notes and mortgages receivable | 1,743 | 10,803 |
Amortization of investment in direct financing leases | 1,004 | 735 |
Net cash flow provided by (used in) investing activitie | 26,888 | -21,557 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ' | ' |
Borrowings under credit line | 3,000 | 129,400 |
Repayments under credit line | -34,000 | -216,190 |
Borrowings under term loan | ' | 100,000 |
Repayments under term loan | ' | -22,030 |
Payments of cash dividends | -21,925 | -17,680 |
Payments of loan origination costs | ' | -2,842 |
Other | -3 | -108 |
Net cash flow used in financing activities | -52,928 | -29,450 |
Change in cash and cash equivalents | -3,639 | -12,206 |
Cash and cash equivalents at beginning of period | 12,035 | 16,876 |
Cash and cash equivalents at end of period | 8,396 | 4,670 |
Supplemental disclosures of cash flow information Cash paid during the period for: | ' | ' |
Interest | 6,686 | 7,192 |
Income taxes | 370 | 450 |
Environmental remediation obligations | 9,366 | 9,329 |
Non-cash transactions: | ' | ' |
Issuance of mortgages receivable related to property dispositions | 5,851 | 4,923 |
Mortgage payable, net related to property acquisition | $390 | ' |
General
General | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||
General | ' | ||||||||||||||||
1. GENERAL | |||||||||||||||||
Basis of Presentation: The consolidated financial statements include the accounts of Getty Realty Corp. and its wholly-owned subsidiaries. We are a real estate investment trust (“REIT”) specializing in the ownership, leasing and financing of retail motor fuel and convenience store properties. The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). We do not distinguish our principal business or our operations on a geographical basis for purposes of measuring performance. We manage and evaluate our operations as a single segment. All significant intercompany accounts and transactions have been eliminated. | |||||||||||||||||
Unaudited, Interim Consolidated Financial Statements: The consolidated financial statements are unaudited but, in our opinion, reflect all adjustments (consisting of normal recurring accruals) necessary for a fair statement of the results for the periods presented. These statements should be read in conjunction with the consolidated financial statements and related notes which appear in our Annual Report on Form 10-K for the year ended December 31, 2013. | |||||||||||||||||
Use of Estimates, Judgments and Assumptions: The consolidated financial statements have been prepared in conformity with GAAP, which requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and revenues and expenses during the period reported. Estimates, judgments and assumptions underlying the accompanying consolidated financial statements include, but are not limited to, receivables, deferred rent receivable, net investment in direct financing leases, environmental remediation costs, real estate, depreciation and amortization, impairment of long-lived assets, litigation, environmental remediation obligations, accrued liabilities, income taxes and the allocation of the purchase price of properties acquired to the assets acquired and liabilities assumed. Application of these estimates and assumptions requires exercise of judgment as to future uncertainties and, as a result, actual results could differ materially from these estimates. | |||||||||||||||||
Subsequent Events: We evaluated subsequent events and transactions for potential recognition or disclosure in our consolidated financial statements. | |||||||||||||||||
New Accounting Pronouncement: In April 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity (“ASU 2014-08”). This guidance defines a discontinued operation as a component or group of components disposed or classified as held for sale and represents a strategic shift that has (or will have) a major effect on an entity’s operations and final results; the guidance states that a strategic shift could include a disposal of a major geographical area of operations, a major line of business, a major equity method investment or other major parts of an entity. The guidance also provides for additional disclosure requirements in connection with both discontinued operations and other dispositions not qualifying as discontinued operations. The guidance will be effective for annual and interim periods beginning on or after December 15, 2014. The guidance applies prospectively to new disposals and new classifications of disposal groups as held for sale after the effective date. We elected to early adopt this standard effective with the interim period beginning July 1, 2014. Prior to July 1, 2014 properties identified as held for sale and/or disposed of were presented in discontinued operations for all periods presented. | |||||||||||||||||
In May 2014, the FASB issued ASU 2014-09 Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). ASU 2014-09 is a comprehensive new revenue recognition model requiring a company to recognize revenue to depict the transfer of goods or services to a customer at an amount reflecting the consideration it expects to receive in exchange for those goods or services. In adopting ASU 2014-09, companies may use either a full retrospective or a modified retrospective approach. ASU 2014-09 is effective for the first interim period within annual reporting periods beginning after December 15, 2016, and early adoption is not permitted. We are currently in the process of evaluating the impact the adoption of ASU 2014-09 will have on our financial position or results of operations. | |||||||||||||||||
In August 2014, the FASB issued guidance ASU 2014-15, Presentation of Financial Statements – Going Concern: Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. This guidance requires management to evaluate whether there is substantial doubt about the entity’s ability to continue as a going concern and, if so, disclose that fact. This guidance is effective for annual periods ending after December 15, 2016, including interim reporting periods thereafter. The new guidance affects disclosures only and is not expected to have a material impact on our consolidated financial position, results of operations or cash flows. | |||||||||||||||||
Fair Value Hierarchy: The preparation of consolidated financial statements in accordance with GAAP requires management to make estimates of fair value that affect the reported amounts of assets and liabilities and disclosure of assets and liabilities at the date of the consolidated financial statements and revenues and expenses during the period reported using a hierarchy (the “Fair Value Hierarchy”) that prioritizes the inputs to valuation techniques used to measure the fair value. The Fair Value Hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The levels of the Fair Value Hierarchy are as follows: “Level 1”-inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access at the measurement date; “Level 2”-inputs other than quoted prices that are observable for the asset or liability either directly or indirectly, including inputs in markets that are not considered to be active; and “Level 3”-inputs that are unobservable. Certain types of assets and liabilities are recorded at fair value either on a recurring or non-recurring basis. Assets required or elected to be marked-to-market and reported at fair value every reporting period are valued on a recurring basis. Other assets not required to be recorded at fair value every period may be recorded at fair value if a specific provision or other impairment is recorded within the period to mark the carrying value of the asset to market as of the reporting date. Such assets are valued on a non-recurring basis. | |||||||||||||||||
We had a receivable of $2,972,000 as of December 31, 2012, that was measured at fair value on a recurring basis using Level 3 inputs. Pursuant to the terms of the Litigation Funding Agreement (as defined below), in the third quarter of 2013, we received a payment of $25,096,000 related to this receivable. We elected to account for the advances, accrued interest and litigation reimbursements due to us pursuant to the Litigation Funding Agreement on a fair value basis. We used unobservable inputs based on comparable transactions when determining the fair value of the Litigation Funding Agreement. We concluded that the terms of the Litigation Funding Agreement were within a range of terms representing the market for such arrangements when considering the unique circumstances particular to the counterparties to such funding agreements. These inputs included the potential outcome of the litigation related to the Lukoil Complaint including the probability of the Marketing Estate prevailing in its lawsuit and the potential amount that may be recovered by the Marketing Estate from Lukoil (as such capitalized terms are defined below). We also applied a discount factor commensurate with the risk that the Marketing Estate may not prevail in its lawsuit. We considered that fair value is defined as an amount of consideration that would be exchanged between a willing buyer and seller. Please refer to note 2 of our accompanying consolidated financial statements for additional information regarding Marketing and the Master Lease. | |||||||||||||||||
We have mutual fund assets that are measured at fair value on a recurring basis using Level 1 inputs. We have a Supplemental Retirement Plan for executives and other senior management employees. The amounts held in trust under the Supplemental Retirement Plan using Level 2 inputs may be used to satisfy claims of general creditors in the event of our or any of our subsidiaries’ bankruptcy. We have liability to the employees participating in the Supplemental Retirement Plan for the participant account balances equal to the aggregate of the amount invested at the employees’ direction and the income earned in such mutual funds. | |||||||||||||||||
We have certain real estate assets that are measured at fair value on a non-recurring basis using Level 3 inputs as of September 30, 2014 and December 31, 2013 of $1,758,000 and $9,590,000, respectively, where impairment charges have been recorded. Due to the subjectivity inherent in the internal valuation techniques used in estimating fair value, the amounts realized from the sale of such assets may vary significantly from these estimates. | |||||||||||||||||
The following summarizes as of September 30, 2014 our assets and liabilities measured at fair value on a recurring basis by level within the Fair Value Hierarchy: | |||||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: | |||||||||||||||||
Mutual funds | $ | 758 | $ | — | $ | — | $ | 758 | |||||||||
Liabilities: | |||||||||||||||||
Deferred compensation | $ | — | $ | 758 | $ | — | $ | 758 | |||||||||
The following summarizes as of December 31, 2013 our assets and liabilities measured at fair value on a recurring basis by level within the Fair Value Hierarchy: | |||||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: | |||||||||||||||||
Mutual funds | $ | 3,275 | $ | — | $ | — | $ | 3,275 | |||||||||
Liabilities: | |||||||||||||||||
Deferred compensation | $ | — | $ | 3,275 | $ | — | $ | 3,275 | |||||||||
Fair Value Disclosure of Financial Instruments: All of our financial instruments are reflected in the accompanying consolidated balance sheets at amounts which, in our estimation based upon an interpretation of available market information and valuation methodologies, reasonably approximate their fair values, except those separately disclosed in the notes to our consolidated financial statements. | |||||||||||||||||
Discontinued Operations and Assets Held-for-Sale: We report as discontinued operations 46 properties which meet the criteria to be accounted for as held for sale in accordance with GAAP as of June 30, 2014 and certain properties disposed of during the periods presented that were previously classified as held for sale as of June 30, 2014. All results of these discontinued operations are included in a separate component of income on the consolidated statements of operations under the caption discontinued operations. This has resulted in certain amounts related to discontinued operations in 2013 being reclassified to conform to the 2014 presentation. We elected to early adopt ASU 2014-08 effective July 1, 2014 and, as a result, the results of operations for all qualifying disposals and properties classified as held for sale that were not previously reported in discontinued operations as of June 30, 2014 are presented within income from continuing operations in our consolidated statements of income. | |||||||||||||||||
As a result of a change in circumstances that were previously considered unlikely, we reclassified two properties from held for sale to held and used as the properties no longer met the criteria to be held for sale during the second quarter of 2014. A property that is reclassified to held and used is measured and recorded at the lower of (i) its carrying amount before the property was classified as held for sale, adjusted for any depreciation expense that would have been recognized had the property been continuously classified as held and used, or (ii) the fair value at the date of the subsequent decision not to sell. | |||||||||||||||||
Real estate held for sale classified as discontinued operations consisted of the following at September 30, 2014 and December 31, 2013: | |||||||||||||||||
(in thousands) | September 30, | December 31, | |||||||||||||||
2014 | 2013 | ||||||||||||||||
Land | $ | 6,365 | $ | 15,586 | |||||||||||||
Buildings and improvements | 6,517 | 15,138 | |||||||||||||||
12,882 | 30,724 | ||||||||||||||||
Accumulated depreciation and amortization | (3,210 | ) | (7,740 | ) | |||||||||||||
Real estate held for sale, net | $ | 9,672 | $ | 22,984 | |||||||||||||
The revenue from rental properties, impairment charges, other operating expenses and gains on dispositions of real estate related to these properties are as follows: | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||||
Revenues from rental properties | $ | 686 | $ | 1,324 | $ | 2,450 | $ | 4,409 | |||||||||
Impairment charges | (2,034 | ) | (2,929 | ) | (5,121 | ) | (6,555 | ) | |||||||||
Other operating expenses | (170 | ) | 2,825 | (1,421 | ) | 1,171 | |||||||||||
Earnings (loss) from operating activities | (1,518 | ) | 1,220 | (4,092 | ) | (975 | ) | ||||||||||
Gains on dispositions of real estate | 2,757 | 26,975 | 7,127 | 39,581 | |||||||||||||
Earnings from discontinued operations | $ | 1,239 | $ | 28,195 | $ | 3,035 | $ | 38,606 | |||||||||
For the three months ended September 30, 2014, we sold two properties resulting in a gain of $1,389,000 that previously did not meet the criteria to be classified as held for sale. We determined that the two properties sold did not represent a strategic shift in our operations as defined in ASU 2014-08 and, as a result, the gains on dispositions of real estate for the two properties were not reflected in our earnings from discontinued operations. | |||||||||||||||||
Impairment of Long-Lived Assets and Long-Lived Assets to Be Disposed Of: Assets are written down to fair value when events and circumstances indicate that the assets might be impaired and the projected undiscounted cash flows estimated to be generated by those assets are less than the carrying amount of those assets. We review and adjust as necessary our depreciation estimates and method when long-lived assets are tested for recoverability. Assets held for disposal are written down to fair value less estimated disposition costs. | |||||||||||||||||
We recorded non-cash impairment charges aggregating $2,906,000 and $6,583,000 for the three and nine months ended September 30, 2014, respectively, and $3,265,000 and $7,717,000 for the three and nine months ended September 30, 2013, respectively, in continuing operations and in discontinued operations. Our estimated fair values, as it relates to property carrying values were primarily based upon (i) estimated sales prices from third-party offers based on signed contracts, letters of intent or indicative bid and/or consideration of the amount that currently would be required to replace the asset, as adjusted for obsolescence (this method was used to determine $3,103,000 of the $6,583,000 in impairments recognized during the nine months ended September 30, 2014), for which we do not have access to the unobservable inputs used to determine these estimated fair values, (ii) discounted cash flow models (this method was used to determine $518,000 of the $6,583,000 in impairments recognized during the nine months ended September 30, 2014) and (iii) the accumulation of asset retirement costs as a result of increases in estimated environmental liabilities which increased the carrying value of certain properties in excess of their fair value (this method was used to determine $2,962,000 of the $6,583,000 in impairments recognized during the nine months ended September 30, 2014). The non-cash impairment charges recorded during the three and nine months ended September 30, 2014 and 2013 were attributable to reductions in estimated undiscounted cash flows expected to be received during the assumed holding period, reductions in our estimates of value for properties held for sale and the accumulation of asset retirement costs as a result of increases in estimated environmental liabilities which increased the carrying value of certain properties in excess of their fair value. The estimated fair value of real estate is based on the price that would be received from the sale of the property in an orderly transaction between market participants at the measurement date. In general, we consider multiple internal valuation techniques when measuring the fair value of a property, all of which are based on unobservable inputs and assumptions that are classified within Level 3 of the Fair Value Hierarchy. These unobservable inputs include assumed holding periods ranging up to 15 years, assumed average rent increases of 2.0% annually, income capitalized at a rate of 8.0% and cash flows discounted at a rate of 7.0%. These assessments have a direct impact on our net income because recording an impairment loss results in an immediate negative adjustment to net income. The evaluation of anticipated cash flows is highly subjective and is based in part on assumptions regarding future rental rates and operating expenses that could differ materially from actual results in future periods. Where properties held for use have been identified as having a potential for sale, additional judgments are required related to the determination as to the appropriate period over which the projected undiscounted cash flows should include the operating cash flows and the amount included as the estimated residual value. This requires significant judgment. In some cases, the results of whether impairment is indicated are sensitive to changes in assumptions input into the estimates, including the holding period until expected sale. | |||||||||||||||||
Deferred Rent Receivable and Revenue Recognition: We earn rental income under operating and direct financing leases with tenants. Minimum lease payments from operating leases are recognized on a straight-line basis over the term of the leases. The cumulative difference between lease revenue recognized under this method and the contractual lease payment terms is recorded as deferred rent receivable on our consolidated balance sheets. We provide reserves for a portion of the recorded deferred rent receivable if circumstances indicate that it is not reasonable to assume that the tenant will make all of its contractual lease payments when due during the current term of the lease. We make estimates of the collectability of our accounts receivable related to revenue from rental properties. We analyze accounts receivable and historical bad debt levels, customer creditworthiness and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. Additionally, with respect to tenants in bankruptcy, we estimate the expected recovery through bankruptcy claims and increase the allowance for amounts deemed uncollectible. If our assumptions regarding the collectability of accounts receivable prove incorrect, we could experience write-offs of the accounts receivable or deferred rent receivable in excess of our allowance for doubtful accounts. Lease termination fees are recognized as rental income when earned upon the termination of a tenant’s lease and relinquishment of space in which we have no further obligation to the tenant. The present value of the difference between the fair market rent and the contractual rent for above-market and below-market leases at the time properties are acquired is amortized into revenue from rental properties over the remaining lives of the in-place leases. | |||||||||||||||||
Direct Financing Leases: Income under direct financing leases is included in revenues from rental properties and is recognized over the lease terms using the effective interest rate method which produces a constant periodic rate of return on the net investments in the leased properties. Net investment in direct financing leases represents the investments in leased assets accounted for as direct financing leases. The investments in direct financing leases are increased for interest income earned and amortized over the life of the leases and reduced by the receipt of lease payments. We consider direct financing leases to be past-due or delinquent when a contractually required payment is not remitted in accordance with the provisions of the underlying agreement. We evaluate each account individually and set up an allowance when, based upon current information and events, it is probable that we will be unable to collect all amounts due according to the existing contractual terms, and the amount can be reasonably estimated. | |||||||||||||||||
We review our direct financing leases at least annually to determine whether there has been an-other-than-temporary decline in the current estimate of residual value of the property. The residual value is our estimate of what we could realize upon the sale of the property at the end of the lease term, based on market information and third-party estimates where available. If this review indicates that a decline in residual value has occurred that is other-than-temporary, we recognize an impairment charge. There were no impairments of any of our direct financing leases during the three and nine months ended September 30, 2014 and 2013. | |||||||||||||||||
When we enter into a contract to sell properties that are recorded as direct financing leases, we evaluate whether we believe it is probable that the disposition will occur. If we determine that the disposition is probable and therefore the property’s holding period is reduced, we record an allowance for credit losses to reflect the change in the estimate of the undiscounted future rents. Accordingly, the net investment balance is written down to fair value. | |||||||||||||||||
Notes and Mortgages Receivable: Notes and mortgages receivable consists of loans originated by us in conjunction with property dispositions and funding provided to tenants in conjunction with property acquisitions. Notes and mortgages receivable are recorded at stated principal amounts. We evaluate the collectability of both interest and principal on each loan to determine whether it is impaired. A loan is considered to be impaired when, based upon current information and events, it is probable that we will be unable to collect all amounts due under the existing contractual terms. When a loan is considered to be impaired, the amount of loss is calculated by comparing the recorded investment to the fair value determined by discounting the expected future cash flows at the loan’s effective interest rate or to the fair value of the underlying collateral, if the loan is collateralized. Interest income on performing loans is accrued as earned. Interest income on impaired loans is recognized on a cash basis. We do not provide for an additional allowance for loan losses based on the grouping of loans as we believe the characteristics of the loans are not sufficiently similar to allow an evaluation of these loans as a group for a possible loan loss allowance. As such, all of our loans are evaluated individually for impairment purposes. | |||||||||||||||||
As of June 30, 2014, we had one loan aggregating $475,000 (including amounts held in escrow) which was in default for nonpayment of principal and interest. We assessed this loan and recorded an allowance for mortgage receivable in the amount of $133,000 at June 30, 2014. This reserve reflected a decrease in the estimated fair value of the underlying collateral. During the quarter ended September 30, 2014, we received partial payment of $75,000 on the loan that was previously impaired and issued a new loan for $400,000 with substantially the same terms as the prior loan. Accordingly, the allowance for loan losses of $35,000 was written off at September 30, 2014. | |||||||||||||||||
Environmental Remediation Obligations: The estimated future costs for known environmental remediation requirements are accrued when it is probable that a liability has been incurred, including legal obligations associated with the retirement of tangible long-lived assets if the asset retirement obligation results from the normal operation of those assets and a reasonable estimate of fair value can be made. Environmental remediation obligations are estimated based on the level and impact of contamination at each property. The accrued liability is the aggregate of the best estimate of the fair value of cost for each component of the liability. The accrued liability is net of recoveries of environmental costs from state underground storage tank (“UST” or “USTs”) remediation funds with respect to both past and future environmental spending based on estimated recovery rates developed from prior experience with the funds. Net environmental liabilities are currently measured based on their expected future cash flows which have been adjusted for inflation and discounted to present value. We accrue for environmental liabilities that we believe are allocable to other potentially responsible parties if it becomes probable that the other parties will not pay their environmental remediation obligations. | |||||||||||||||||
Income Taxes: We and our subsidiaries file a consolidated federal income tax return. Effective January 1, 2001, we elected to qualify, and believe we are operating so as to qualify, as a REIT for federal income tax purposes. Accordingly, we generally will not be subject to federal income tax on qualifying REIT income, provided that distributions to our shareholders equal at least the amount of our taxable income as defined under the Internal Revenue Code. We accrue for uncertain tax matters when appropriate. The accrual for uncertain tax positions is adjusted as circumstances change and as the uncertainties become more clearly defined, such as when audits are settled or exposures expire. Tax returns for the years 2010, 2011, 2012 and 2013, and tax returns which will be filed for the year ended 2014, remain open to examination by federal and state tax jurisdictions under the respective statute of limitations. | |||||||||||||||||
In the third quarter of 2013, we submitted to the Internal Revenue Service (“IRS”) a request seeking a ruling that a portion of the payments we received from the Marketing Estate, including amounts related to the Litigation Funding Agreement (see note 2 for additional information regarding the Lukoil Settlement and the Litigation Funding Agreement), be treated either as qualifying income or excluded from gross income for the purposes of the REIT qualification gross income tests either as a matter of law or pursuant to the discretionary authority granted by Congress to the IRS to determine whether certain types of income are an outgrowth of a REIT’s business of owning and operating real estate. In January 2014, we received a favorable ruling from the IRS indicating that a portion of the payments received from the Marketing Estate will be treated as qualifying income and the remainder will be excluded from gross income for the purposes of the REIT qualification gross income tests. Therefore, none of the cash flow received from the Marketing Estate, including amounts related to the Litigation Funding Agreement, will be treated as non-qualifying income for purposes of the REIT qualification gross income tests. | |||||||||||||||||
Earnings per Common Share: Basic earnings per common share gives effect, utilizing the two-class method, to the potential dilution from the issuance of common shares in settlement of restricted stock units (“RSU” or “RSUs”) which provide for non-forfeitable dividend equivalents equal to the dividends declared per common share. Basic earnings per common share is computed by dividing net earnings less dividend equivalents attributable to RSUs by the weighted-average number of common shares outstanding during the year. Diluted earnings per common share, also gives effect to the potential dilution from the exercise of stock options utilizing the treasury stock method. There were 5,000 stock options excluded from the earnings per share calculations below as they were anti-dilutive as of September 30, 2014 and 2013, respectively. | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||||
Earnings from continuing operations | $ | 8,996 | $ | 13,682 | $ | 23,475 | $ | 26,360 | |||||||||
Less dividend equivalents attributable to RSUs outstanding | (89 | ) | (120 | ) | (232 | ) | (232 | ) | |||||||||
Earnings from continuing operations attributable to common shareholders | 8,907 | 13,562 | 23,243 | 26,128 | |||||||||||||
Earnings from discontinued operations | 1,239 | 28,195 | 3,035 | 38,606 | |||||||||||||
Less dividend equivalents attributable to RSUs outstanding | (12 | ) | (248 | ) | (39 | ) | (339 | ) | |||||||||
Earnings from discontinued operations attributable to common shareholders | 1,227 | 27,947 | 2,996 | 38,267 | |||||||||||||
Net earnings attributable to common shareholders used for basic and diluted earnings per share calculation | $ | 10,134 | $ | 41,509 | $ | 26,239 | $ | 64,395 | |||||||||
Weighted-average number of common shares outstanding: | |||||||||||||||||
Basic | 33,417 | 33,397 | 33,406 | 33,397 | |||||||||||||
Stock options | — | — | — | — | |||||||||||||
Diluted | 33,417 | 33,397 | 33,406 | 33,397 | |||||||||||||
RSUs outstanding at the end of the period | 333 | 296 | 333 | 296 | |||||||||||||
Dividends: For the nine months ended September 30, 2014 and 2013, we paid cash dividends of $21,925,000 or $0.65 per share (which consisted of $20,240,000 or $0.60 per share of regular quarterly cash dividends and a $1,685,000 or $0.05 per share special cash dividend) and $17,680,000 or $0.525 per share, respectively. | |||||||||||||||||
Revision: As previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2013, we identified and corrected an error in which we inappropriately classified certain rental property expenses as discontinued operations. The error resulted in a reclassification of $933,000 and $1,726,000 of rental property expenses to continuing operations in our statements of operations for the three and nine months ended September 30, 2013. The effect of this error had no impact on our net income, consolidated balance sheets or statements of cash flows. For purposes of this Quarterly Report on Form 10-Q, we have revised our results for the three and nine months ended September 30, 2013 as presented below. Certain reclassifications have also been made to the prior period amounts to conform to the current period presentation. | |||||||||||||||||
The effect of these revisions is shown below (in thousands): | |||||||||||||||||
THREE MONTHS ENDED September 30, 2013 | As previously | Reclassifications | Revisions | As revised | |||||||||||||
reported | |||||||||||||||||
Revenues from rental properties | $ | 25,425 | $ | (733 | ) | $ | — | $ | 24,692 | ||||||||
Earnings from continuing operations | 15,295 | (680 | ) | (933 | ) | 13,682 | |||||||||||
Net earnings | 41,877 | — | — | 41,877 | |||||||||||||
NINE MONTHS ENDED September 30, 2013 | As previously | Reclassifications | Revisions | As revised | |||||||||||||
reported | |||||||||||||||||
Revenues from rental properties | $ | 72,360 | $ | (2,224 | ) | $ | — | $ | 70,136 | ||||||||
Earnings from continuing operations | 29,031 | (945 | ) | (1,726 | ) | 26,360 | |||||||||||
Net earnings | 64,966 | — | — | 64,966 | |||||||||||||
Out-of-Period Adjustment: We corrected a misstatement in our recording of prepaid real estate taxes and real estate tax expense for the year ended 2013, which decreased our net earnings by $420,000 during the quarter ended March 31, 2014. We concluded that these adjustments were not material to our results for this or any of the prior periods. |
Leases
Leases | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Leases [Abstract] | ' | ||||||||||||||||
Leases | ' | ||||||||||||||||
2. LEASES | |||||||||||||||||
The majority of our properties are leased on a triple-net basis primarily to petroleum distributors and, to a lesser extent, individual operators. Generally our tenants supply fuel and either operate our properties directly or sublet our properties to operators who operate their gas stations, convenience stores, automotive repair service facilities or other businesses at our properties. Our triple-net tenants are responsible for the payment of all taxes, maintenance, repairs, insurance and other operating expenses relating to our properties, and are also responsible for environmental contamination occurring during the terms of their leases and in certain cases also for preexisting environmental contamination. (See note 5 for additional information regarding environmental obligations.) Substantially all of our tenants’ financial results depend on the sale of refined petroleum products and rental income from their subtenants. As a result, our tenants’ financial results are highly dependent on the performance of the petroleum marketing industry, which is highly competitive and subject to volatility. As of September 30, 2014, we owned 776 properties and leased 112 properties from third-party landlords. Our 888 properties are located in 20 states across the United States and Washington, D.C., with concentrations in the Northeast and Mid-Atlantic regions. | |||||||||||||||||
Revenues from rental properties included in continuing operations for the three and nine months ended September 30, 2014 were $24,014,000 and $71,911,000, respectively. Revenues from rental properties included in continuing operations for the three and nine months ended September 30, 2013 were $24,692,000 and $70,136,000, respectively. Rental income contractually due or received from our tenants, including amounts realized under our prior interim fuel supply agreement, included in revenues from rental properties in continuing operations was $19,486,000 and $57,573,000 for the three and nine months ended September 30, 2014, respectively, and $18,896,000 and $54,039,000 for the three and nine months ended September 30, 2013, respectively. “Pass-through” real estate taxes and other municipal charges paid by us which were reimbursable by our tenants pursuant to the terms of triple-net lease agreements included in revenues from rental properties and rental property expenses in continuing operations totaled $3,721,000 and $9,809,000 for the three and nine months ended September 30, 2014, respectively, and $3,666,000 and $10,452,000 for the three and nine months ended September 30, 2013, respectively. Total revenues for the three and nine months ended September 30, 2013 includes $3,126,000 of other revenue recorded for the partial recovery of damages stemming from Marketing’s default of its obligations under the Master Lease. | |||||||||||||||||
In accordance with GAAP, we recognize rental revenue in amounts which vary from the amount of rent contractually due or received during the periods presented. As a result, revenues from rental properties include non-cash adjustments recorded for deferred rental revenue due to the recognition of rental income on a straight-line (or average) basis over the current lease term, the net amortization of above-market and below-market leases, recognition of rental income recorded under direct financing leases using the effective interest method which produces a constant periodic rate of return on the net investments in the leased properties and the amortization of deferred lease incentives (the “Revenue Recognition Adjustments”). Revenue Recognition Adjustments included in revenues from rental properties in continuing operations were $807,000 and $4,529,000 for the three and nine months ended September 30, 2014, respectively, as compared to $2,130,000 and $5,645,000 for the three and nine months ended September 30, 2013, respectively. We provide reserves for a portion of the recorded deferred rent receivable if circumstances indicate that a tenant will not make all of its contractual lease payments during the current lease term. Our assessments and assumptions regarding the recoverability of the deferred rent receivable are reviewed on an ongoing basis and such assessments and assumptions are subject to change. | |||||||||||||||||
The components of the $96,143,000 net investment in direct financing leases as of September 30, 2014 are minimum lease payments receivable of $194,501,000 plus unguaranteed estimated residual value of $13,979,000 less unearned income of $112,337,000. The components of the $97,147,000 net investment in direct financing leases as of December 31, 2013 were minimum lease payments receivable of $203,438,000 plus unguaranteed estimated residual value of $13,979,000 less unearned income of $120,270,000. | |||||||||||||||||
Marketing and the Master Lease | |||||||||||||||||
Approximately 510 of the properties we own or lease as of September 30, 2014 were previously leased to Getty Petroleum Marketing Inc. (“Marketing”) pursuant to a master lease (the “Master Lease”). In December 2011, Marketing filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court. The Master Lease was terminated effective April 30, 2012, and in July 2012, the Bankruptcy Court approved Marketing’s Plan of Liquidation and appointed a trustee (the “Liquidating Trustee”) to oversee liquidation of the Marketing estate (the “Marketing Estate”). We incurred significant costs associated with Marketing’s bankruptcy, including legal expenses, of which $653,000 and $3,962,000, respectively, are included in general and administrative expense for the nine months ended September 30, 2014 and 2013. | |||||||||||||||||
In December 2011, the Marketing Estate filed a lawsuit (the “Lukoil Complaint”) against Marketing’s former parent, Lukoil Americas Corporation, and certain of its affiliates (collectively, “Lukoil”). In October 2012, we entered into an agreement with the Marketing Estate to make loans and otherwise fund up to an aggregate amount of $6,725,000 to prosecute the Lukoil Complaint and for certain other expenses incurred in connection with the wind-down of the Marketing Estate (the “Litigation Funding Agreement”). We ultimately advanced $6,526,000 in the aggregate to the Marketing Estate pursuant to the Litigation Funding Agreement. The Litigation Funding Agreement also provided that we were entitled to be reimbursed for up to $1,300,000 of our legal fees incurred in connection with the Litigation Funding Agreement. | |||||||||||||||||
On July 29, 2013, the Bankruptcy Court approved a settlement of the claims made in the Lukoil Complaint (the “Lukoil Settlement”). The terms of the Lukoil Settlement included a collective payment to the Marketing Estate of $93,000,000. In August 2013, the settlement payment was received by the Marketing Estate of which $25,096,000 was distributed to us pursuant to the Litigation Funding Agreement and $6,585,000 was distributed to us in full satisfaction of our post-petition priority claims related to the Master Lease. | |||||||||||||||||
Of the $25,096,000 received by us in the third quarter of 2013 pursuant to the Litigation Funding Agreement, $7,976,000 was applied to the advances made to the Marketing Estate plus accrued interest; $13,994,000 was applied to unpaid rent and real estate taxes due from Marketing and the related bad debt reserve was reversed in full; and the remainder of $3,126,000 was recorded as additional income attributed to the partial recovery of damages resulting from Marketing’s default of its obligations under the Master Lease and is reflected in continuing operations in our consolidated statements of operations as other revenue in the third quarter of 2013. | |||||||||||||||||
We believe that we will receive additional distributions from the Marketing Estate to partially satisfy our remaining general unsecured claims. We cannot provide any assurance as to our proportionate interest in any Marketing Estate assets, or the amount or timing of recoveries, if any, with respect to our remaining general unsecured claims against the Marketing Estate. | |||||||||||||||||
Leasing Activities | |||||||||||||||||
As of September 30, 2014, we have entered into long-term triple-net leases with petroleum distributors for 13 separate property portfolios comprising 452 properties in the aggregate that were previously leased to Marketing. We have also entered into month-to-month license agreements with occupants of 29 properties previously leased to Marketing (substantially all of whom were Marketing’s former subtenants) allowing such occupants to continue to occupy and use these properties as gas stations, convenience stores, automotive repair service facilities or other businesses. Under our month-to-month license agreements, we receive monthly licensing fees and are responsible for the payment of certain Property Expenditures (as defined below) and environmental costs. | |||||||||||||||||
The long-term triple-net leases with petroleum distributors are unitary triple-net lease agreements generally with an initial term of 15 years, and options for successive renewal terms of up to 20 years. Rent is scheduled to increase at varying intervals of up to five years on the anniversary of the commencement date of the leases. The majority of the leases provide for additional rent based on the aggregate volume of petroleum products sold. In addition, the majority of the leases require the tenants to make capital expenditures at our properties substantially all of which are related to the replacement of underground storage tanks (“USTs”) that are owned by our tenants. We have committed to co-invest up to $15,263,000 in the aggregate with our tenants for a portion of such capital expenditures, which deferred expense is recognized on a straight-line basis as a reduction of rental revenue in our consolidated statements of operations over the terms of the various leases. As of September 30, 2014 and December 31, 2013, we have invested $962,000 and $308,000, respectively, of our capital commitment. | |||||||||||||||||
As part of the triple-net leases for properties previously leased to Marketing, we transferred title of the USTs to our tenants, and the obligation to pay for the retirement and decommissioning or removal of USTs at the end of their useful life or earlier if circumstances warranted was fully or partially transferred to our new tenants. We remain contingently liable for this obligation in the event that our tenants do not satisfy their responsibilities. Accordingly, through September 30, 2014, we removed $13,074,000 of asset retirement obligations and $10,633,000 of net asset retirement costs related to USTs from our balance sheet. The cumulative net amount of $2,441,000 is recorded as deferred rental revenue and will be recognized on a straight-line basis as additional revenues from rental properties over the terms of the various leases. We incurred $60,000 and $365,000 of lease origination costs for the nine months ended September 30, 2014 and September 30, 2013, respectively, which deferred expense is recognized on a straight-line basis as amortization expense in our consolidated statements of operations over the terms of the various leases. | |||||||||||||||||
Chestnut Petroleum Dist. Inc. | |||||||||||||||||
As of September 30, 2014, we leased 131 gasoline station and convenience store properties in two separate unitary leases to subsidiaries of Chestnut Petroleum Dist. Inc. We lease 58 properties to CPD NY Energy Corp. (“CPD NY”) and 73 properties to NECG Holdings Corp. (“NECG”). CPD NY and NECG together represented 20% and 21% of our rental revenues for the nine months ended September 30, 2014 and 2013, respectively. Although we have separate, non-cross defaulted leases with each of these subsidiaries, because such subsidiaries are affiliated with one another and under common control, a material adverse impact on one subsidiary, or failure of such subsidiary to perform its rental and other obligations to us, may contribute to a material adverse impact on the other subsidiary and/or failure of the other subsidiary to perform its rental and other obligations to us. | |||||||||||||||||
The selected combined unaudited financial data of CPD NY and NECG, which has been prepared by Chestnut Petroleum Dist. Inc.’s management, is provided below: | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||||
Operating Data: | |||||||||||||||||
Total revenue | $ | 144,942 | $ | 143,191 | $ | 419,338 | $ | 410,182 | |||||||||
Gross profit | 12,130 | 10,054 | 32,313 | 29,841 | |||||||||||||
Net income | 541 | 1,243 | 1,240 | 2,702 | |||||||||||||
September 30, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Balance Sheet Data: | |||||||||||||||||
Current assets | $ | 12,579 | $ | 10,944 | |||||||||||||
Noncurrent assets | 30,096 | 28,852 | |||||||||||||||
Current liabilities | 15,624 | 13,985 | |||||||||||||||
Noncurrent liabilities | 16,043 | 16,043 | |||||||||||||||
Eviction proceedings are ongoing against a group of former Marketing subtenants (or sub-subtenants) who continue to occupy properties in the State of Connecticut which are subject to our unitary lease with NECG (the “NECG Lease”). These ongoing eviction proceedings have had a material adverse impact on NECG’s operations and profitability. In June 2013, the Connecticut Superior Court ruled in our favor with respect to all 24 locations involved in the proceedings. However, in July 2013, a majority of the operators against whom these Superior Court rulings were made appealed the decisions. As of the date of this Quarterly Report on Form 10-Q, 16 of the 24 former operators against whom eviction proceedings were brought have reached agreements with NECG to either remain in their respective properties or vacate them, and in either case their appeals have been withdrawn. Eight of the operators remain in contested occupancy of the subject sites during the pendency of their appeal. We remain confident that we will prevail in the remaining appeals and, although no assurances can be given, we anticipate a favorable resolution of this matter in 2015. | |||||||||||||||||
In August 2013, we entered into an agreement to modify the NECG Lease and, as part of such agreement, we deferred portions of the scheduled rent payments due from NECG. This lease modification agreement also included provisions under which we can recapture and sever properties from the NECG Lease and, as of September 30, 2014, 20 of these properties are accounted for as held for sale. As a result of the disruption and costs associated with the litigation, NECG was not current in its rent and certain other obligations to us under the NECG Lease. We increased our accounts receivable bad debt reserves related to the NECG Lease by approximately $131,000 for the nine months ended September 30, 2014 so that the total bad debt reserve related to NECG as of September 30, 2014 is approximately $1,896,000 in aggregate. | |||||||||||||||||
As a result of the developments with NECG described above, we concluded that it was probable that we would not receive from NECG the entire amount of the contractual lease payments owed to us under the NECG Lease. Accordingly, during the nine months ended September 30, 2014, we recorded a non-cash allowance for deferred rent receivable related to the NECG Lease of $1,568,000. As of September 30, 2014, we have fully reserved for the outstanding deferred rent receivable balance of $6,343,000. This non-cash allowance reduced our net earnings for the nine months ended September 30, 2014, but did not impact our cash flow from operating activities. | |||||||||||||||||
We are monitoring the developments with NECG and are engaged in discussions with them about potential modifications to the NECG Lease, which may include, without limitations, the removal of certain properties from the NECG Lease. Our discussions with NECG are ongoing and we cannot predict the ultimate outcome of these discussions. As of September 30, 2014, and the date of this Quarterly Report on Form 10-Q, NECG is current in its rent payments to us, as amended. | |||||||||||||||||
Capitol Petroleum Group, LLC | |||||||||||||||||
As of September 30, 2014, we leased 97 gasoline station and convenience store properties in four separate unitary leases to subsidiaries of Capitol Petroleum Group, LLC. We lease 37 properties to White Oak Petroleum, LLC, 24 properties to Hudson Petroleum Realty, LLC, 20 properties to Dogwood Petroleum Realty, LLC and 16 properties to Big Apple Petroleum Realty, LLC. In aggregate, these Capitol affiliates represented 17% and 13% of our rental revenues for the nine months ended September 30, 2014 and 2013, respectively. Although we have separate, non-cross defaulted leases with each of these subsidiaries, because such subsidiaries are affiliated with one another and under common control, a material adverse impact on one subsidiary, or failure of such subsidiary to perform its rental and other obligations to us, may contribute to a material adverse impact on the other subsidiaries and/or failure of the other subsidiaries to perform its rental and other obligations to us. | |||||||||||||||||
The selected combined unaudited financial data of White Oak Petroleum, LLC, Hudson Petroleum Realty, LLC, Dogwood Petroleum Realty, LLC and Big Apple Petroleum Realty, LLC, which has been prepared by Capitol Petroleum Group, LLC’s management, is provided below: | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||||
Operating Data: | |||||||||||||||||
Total revenue | $ | 89,830 | $ | 91,135 | $ | 266,933 | $ | 268,880 | |||||||||
Gross profit | 2,341 | 2,338 | 5,753 | 9,724 | |||||||||||||
Net loss | (870 | ) | (783 | ) | (3,918 | ) | (1,363 | ) | |||||||||
September 30, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Balance Sheet Data: | |||||||||||||||||
Current assets | $ | 6,254 | $ | 10,128 | |||||||||||||
Noncurrent assets | 108,808 | 111,540 | |||||||||||||||
Current liabilities | 8,578 | 10,880 | |||||||||||||||
Noncurrent liabilities | 135,383 | 135,210 |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies | ' |
3. COMMITMENTS AND CONTINGENCIES | |
Credit Risk | |
In order to minimize our exposure to credit risk associated with financial instruments, we place our temporary cash investments, if any, with high credit quality institutions. Temporary cash investments, if any, are currently held in an overnight bank time deposit with JPMorgan Chase Bank, N.A. | |
Legal Proceedings | |
We are subject to various legal proceedings and claims which arise in the ordinary course of our business. As of September 30, 2014 and December 31, 2013, we had accrued $11,040,000 and $11,423,000, respectively, for certain of these matters which we believe were appropriate based on information then currently available. We have recorded provisions for litigation losses aggregating $95,000 and $5,065,000 for certain of these matters during the three months ended September 30, 2014 and 2013, respectively. We have recorded provisions for litigation losses aggregating $130,000 and $5,471,000 for certain of these matters during the nine months ended September 30, 2014 and 2013, respectively. We are unable to estimate ranges in excess of the amount accrued with any certainty for these matters. It is possible that our assumptions regarding the ultimate allocation method and share of responsibility that we used to allocate environmental liabilities may change, which may result in our providing an accrual, or adjustments to the amounts recorded, for environmental litigation accruals. Matters related to our former Newark, New Jersey Terminal and the Lower Passaic River and MTBE litigations in the states of New Jersey and Pennsylvania, in particular, could cause a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price. | |
Matters related to our former Newark, New Jersey Terminal and the Lower Passaic River | |
In September 2003, we received a directive (the “Directive”) issued by the New Jersey Department of Environmental Protection (“NJDEP”) under the New Jersey Spill Compensation and Control Act. The Directive indicated that we are one of approximately 66 potentially responsible parties for alleged Natural Resource Damages (“NRD” or “NRDs”) resulting from the discharges of hazardous substances along the lower Passaic River (the “Lower Passaic River”). The Directive provided, among other things, that the recipients thereof must conduct an assessment of the natural resources that have been injured by the discharges into the Lower Passaic River and must implement interim compensatory restoration for the injured natural resources. The NJDEP alleges that our liability arises from alleged discharges originating from our former Newark, New Jersey Terminal site (which was sold in October 2013). We responded to the Directive by asserting that we were not liable. There has been no material activity and/or communications by the NJDEP with respect to the Directive since early after its issuance. | |
In May 2007, the United States Environmental Protection Agency (“EPA”) entered into an Administrative Settlement Agreement and Order on Consent (“AOC”) with over 70 parties, most of which are also members of a Cooperating Parties Group (“CPG”) who have collectively agreed to perform a Remedial Investigation and Feasibility Study (“RI/FS”) for a 17 mile stretch of the Lower Passaic River in New Jersey. We are a party to the AOC and are a member of the CPG. The RI/FS is intended to address the investigation and evaluation of alternative remedial actions with respect to alleged damages to the Lower Passaic River, and is scheduled to be completed in or about late 2014. Subsequently, the members of the CPG entered into an Administrative Settlement Agreement and Order on Consent (“10.9 AOC”) effective June 18, 2012 to perform certain remediation activities, including removal and capping of sediments at the river mile 10.9 area and certain testing. The EPA also issued a Unilateral Order to Occidental Chemical Corporation (“Occidental”) directing Occidental to participate and contribute to the cost of the river mile 10.9 work. On April 11, 2014, the EPA issued a Focused Feasibility Study (“FFS”) with proposed remedial alternatives to address cleanup of the lower 8-mile stretch of the Lower Passaic River. While the EPA’s preferred approach would involve bank-to-bank dredging and installing an engineered cap, the FFS is subject to public comments and/or objections that must be considered by the EPA before a final remedial approach is selected and thus many uncertainties remain with respect to the final remedy for the lower 8-miles of the Lower Passaic River. The FFS, RI/FS, AOC and 10.9 AOC do not resolve liability issues for remedial work or the restoration of or compensation for alleged natural resource damages to the Lower Passaic River, which are not known at this time. Our ultimate liability, if any, in the pending and possible future proceedings pertaining to the Lower Passaic River is uncertain and subject to numerous contingencies which cannot be predicted and the outcome of which are not yet known. | |
MTBE Litigation — State of New Jersey | |
We are defending against a lawsuit brought by various governmental agencies of the State of New Jersey, including the NJDEP alleging various theories of liability due to contamination of groundwater with methyl tertiary butyl ether (a fuel derived from methanol, commonly referred to as “MTBE”) involving multiple locations throughout the State of New Jersey (the “New Jersey MDL Proceedings”). The complaint names as defendants approximately 50 petroleum refiners, manufacturers, distributors and retailers of MTBE or gasoline containing MTBE. The State of New Jersey is seeking reimbursement of significant clean-up and remediation costs arising out of the alleged release of MTBE containing gasoline in the State of New Jersey and is asserting various natural resource damage claims as well as liability against the owners and operators of gas station properties from which the releases occurred. Although the ultimate outcome of the New Jersey MDL Proceedings cannot be ascertained at this time, we believe it is probable that this litigation will be resolved in a manner that is unfavorable to us. Preliminary settlement communications from the plaintiffs indicated that they were seeking $88,000,000 collectively from us, Marketing and Lukoil. Subsequent communications from the plaintiffs indicate that they are seeking approximately $24,000,000 from us. We have countered with a settlement offer on behalf of the Company only, which was rejected. We do not believe that plaintiffs’ settlement proposal is realistic given the legal theories and facts applicable to our activities and gas stations, and affirmative defenses available to us, all of which we believe have not been sufficiently developed in the proceedings. We continue to engage in a settlement negotiation and a dialogue to educate the plaintiff’s counsel on the unique nature of the Company and our business as compared to the other defendants in the litigation. In addition, we are pursuing claims for insurance coverage that we believe is available under pollution insurance policies previously obtained by Marketing and under which we are entitled to coverage; however, we have not yet confirmed whether and to what extent such coverage may actually be available. We are unable to estimate with certainty the amount of possible loss in excess of the amount accrued for the New Jersey MDL Proceedings as we do not believe that plaintiffs’ settlement proposal is realistic and there remains uncertainty as to the allegations in this case as they relate to us, our defenses to the claims, our rights to indemnification or contribution from other parties and the aggregate possible amount of damages for which we may be held liable. Our best estimate of the loss within a range of loss has been accrued for; however, it is possible that losses related to the New Jersey MDL Proceedings could result in a loss in excess of the amount accrued as of September 30, 2014 and such additional losses could cause a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price. | |
MTBE Litigation — State of Pennsylvania | |
On June 19, 2014, the Commonwealth of Pennsylvania filed a complaint in the Court of Common Pleas, Philadelphia County alleging various theories of liability due to alleged statewide MTBE contamination in Pennsylvania (the “Complaint”). | |
The Complaint names us and more than 50 other defendants, including but not limited to Exxon Mobil, various BP entities, Chevron, Citgo, Gulf, Lukoil Americas, Getty Petroleum Marketing Inc., Marathon, Hess, Shell Oil, Texaco, Valero, as well as other smaller petroleum refiners, manufacturers, distributors and retailers of MTBE or gasoline containing MTBE. | |
The Complaint seeks compensation, among other asserted causes of action, for natural resource damages and for injuries sustained as a result of “defendants’ unfair and deceptive trade practices and acts in the marketing of MTBE and gasoline containing MTBE.” Plaintiffs also seek to recover costs paid or incurred by the State of Pennsylvania to detect, treat and remediate MTBE from public and private water wells and groundwater. | |
We intend to defend vigorously against the Complaint. Our ultimate liability, if any, in this proceeding is uncertain and subject to numerous contingencies which cannot be predicted and the outcome of which are not yet known. |
Credit_Agreement_and_Prudentia
Credit Agreement and Prudential Loan Agreement | 9 Months Ended |
Sep. 30, 2014 | |
Debt Disclosure [Abstract] | ' |
Credit Agreement and Prudential Loan Agreement | ' |
4. CREDIT AGREEMENT AND PRUDENTIAL LOAN AGREEMENT | |
Credit Agreement | |
On February 25, 2013, we entered into a $175,000,000 senior secured revolving credit agreement (the “Credit Agreement”) with a group of commercial banks led by JPMorgan Chase Bank, N.A. (the “Bank Syndicate”), which is scheduled to mature in August 2015. Subject to the terms of the Credit Agreement, we have the option to extend the term of the Credit Agreement for one additional year to August 2016. The Credit Agreement allocates $25,000,000 of the total Bank Syndicate commitment to a term loan and $150,000,000 to a revolving credit facility. Subject to the terms of the Credit Agreement, we have the option to increase by $50,000,000 the amount of the revolving credit facility to $200,000,000. The Credit Agreement permits borrowings at an interest rate equal to the sum of a base rate plus a margin of 1.50% to 2.00% or a LIBOR rate plus a margin of 2.50% to 3.00% based on our leverage at the end of each quarterly reporting period. The annual commitment fee on the undrawn funds under the Credit Agreement is 0.30% to 0.40% based on our leverage at the end of each quarterly reporting period. The Credit Agreement does not provide for scheduled reductions in the principal balance prior to its maturity. As of September 30, 2014, borrowings under the Credit Agreement were $27,000,000 bearing interest at a rate of approximately 2.7% per annum. | |
The Credit Agreement provides for collateral in the form of, among other items, mortgage liens on certain of our properties. As of September 30, 2014 and December 31, 2013, the mortgaged properties had an aggregate net book value of $153,795,000 and $154,117,000, respectively. The parties to the Credit Agreement and the Prudential Loan Agreement (as defined below) share the collateral pursuant to the terms of an inter-creditor agreement. The Credit Agreement contains customary financial covenants such as loan to value, leverage and coverage ratios and minimum tangible net worth, as well as limitations on restricted payments, which may limit our ability to incur additional debt or pay dividends. The Credit Agreement contains customary events of default, including default under the Prudential Loan Agreement, change of control and failure to maintain REIT status. Any event of default, if not cured or waived, would increase by 200 basis points (2.00%) the interest rate we pay under the Credit Agreement and prohibit us from drawing funds against the Credit Agreement and could result in the acceleration of our indebtedness under the Credit Agreement and could also give rise to an event of default and could result in the acceleration of our indebtedness under the Prudential Loan Agreement. We may be prohibited from drawing funds against the revolving credit facility if there is a material adverse effect on our business, assets, prospects or condition. | |
On December 23, 2013, we amended the Credit Agreement to change certain definitions and financial covenant calculations provided for in the agreement. | |
Prudential Loan Agreement | |
On February 25, 2013, we entered into a $100,000,000 senior secured term loan agreement with the Prudential Insurance Company of America (the “Prudential Loan Agreement”), which matures in February 2021. The Prudential Loan Agreement bears interest at 6.00%. The Prudential Loan Agreement does not provide for scheduled reductions in the principal balance prior to its maturity. The parties to the Credit Agreement and the Prudential Loan Agreement share the collateral described above pursuant to the terms of an inter-creditor agreement. The Prudential Loan Agreement contains customary financial covenants such as loan to value, leverage and coverage ratios and minimum tangible net worth, as well as limitations on restricted payments, which may limit our ability to incur additional debt or pay dividends. The Prudential Loan Agreement contains customary events of default, including default under the Credit Agreement and failure to maintain REIT status. Any event of default, if not cured or waived, would increase by 200 basis points (2.00%) the interest rate we pay under the Prudential Loan Agreement and could result in the acceleration of our indebtedness under the Prudential Loan Agreement and could also give rise to an event of default and could result in the acceleration of our indebtedness under our Credit Agreement. | |
On December 23, 2013, we amended the Prudential Loan Agreement to change certain definitions and financial covenant calculations provided for in the agreement. | |
The aggregate maturity of the Credit Agreement and the Prudential Loan Agreement as of September 30, 2014, is as follows: 2015 — $27,000,000 and 2021 — $100,000,000. | |
As of September 30, 2014 and December 31, 2013, the carrying value of the borrowings outstanding under the Credit Agreement approximated fair value. As of September 30, 2014, the fair value of borrowings outstanding under the Prudential Loan Agreement was approximately $105,000,000 and as of December 31, 2013, the carrying value of the borrowings outstanding under the Prudential Loan Agreement approximated fair value. The fair value of the borrowings outstanding as of September 30, 2014 and December 31, 2013 was determined using a discounted cash flow technique that incorporates a market interest yield curve with adjustments for duration, optionality, risk profile and projected average borrowings outstanding or borrowings outstanding, which are based on unobservable inputs within Level 3 of the Fair Value Hierarchy. |
Environmental_Obligations
Environmental Obligations | 9 Months Ended |
Sep. 30, 2014 | |
Environmental Remediation Obligations [Abstract] | ' |
Environmental Obligations | ' |
5. ENVIRONMENTAL OBLIGATIONS | |
We are subject to numerous federal, state and local laws and regulations, including matters relating to the protection of the environment such as the remediation of known contamination and the retirement and decommissioning or removal of long-lived assets including buildings containing hazardous materials, USTs and other equipment. Environmental costs are principally attributable to remediation costs which include installing, operating, maintaining and decommissioning remediation systems, monitoring contamination and governmental agency reporting incurred in connection with contaminated properties. We seek reimbursement from state UST remediation funds related to these environmental costs where available. In July 2012, we purchased for $3,062,000 a ten-year pollution legal liability insurance policy covering all of our properties for preexisting unknown environmental liabilities and new environmental events. The policy has a $50,000,000 aggregate limit and is subject to various self-insured retentions and other conditions and limitations. Our intention in purchasing this policy is to obtain protection predominantly for significant events. No assurances can be given that we will obtain a net financial benefit from this investment. | |
We enter into leases and various other agreements which allocate between the parties responsibility for known and unknown environmental liabilities at or relating to the subject properties. We are contingently liable for these environmental obligations in the event that the counterparty to the agreement does not satisfy them. | |
For all of our triple-net leases, our tenants are directly responsible for compliance with various environmental laws and regulations, for the retirement and decommissioning or removal of all or a negotiated percentage of USTs and other equipment and for remediation of environmental contamination that arises during the term of their tenancy. Under the terms of our leases covering properties previously leased to Marketing, we have agreed to be responsible for environmental contamination at the premises that was known at the time the lease commenced and for contamination that existed at the premises prior to commencement of the lease and is discovered (other than as a result of a voluntary site investigation) during the first ten years of the lease term. After expiration of such ten year period, responsibility for all newly discovered contamination (irrespective of when the contamination first arose) is allocated to our tenant. In all events, our tenants at properties previously leased to Marketing are responsible for the cost of any remediation of contamination that results from their use and occupancy of our properties. Under substantially all of our other triple-net leases, responsibility for remediation of all environmental contamination discovered during the term of the lease (including known and unknown contamination that existed prior to commencement of the lease) is the responsibility of our tenant. | |
For properties previously leased to Marketing, we anticipate that many USTs will be replaced over the next decade as these USTs are either at, or near, the end of their useful lives. For sites previously leased to Marketing under long-term triple-net leases, our current tenants are responsible for the cost of such removal and replacement, and we are responsible for costs associated with the remediation of any preexisting contamination found during the course of a UST removal and replacement, assuming such contamination is found during the first ten years of the lease term. For our transitional properties occupied under month-to-month license agreements, or which are vacant, we are responsible for costs associated with UST removals and for the cost of remediation of contamination found during the removal of USTs. (For additional information regarding our transitional properties, see “Item 1. Business — Company Operations” which appears in our Annual Report on Form 10-K for the year ended December 31, 2013 and “Transitional Properties” in “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report on Form 10-Q.) As a result of removals and replacements of USTs, we believe we are likely to incur significant additional environmental remediation costs; however, the amount and timing of such additional costs cannot be predicted and, therefore, no amount has been accrued for in our consolidated financial statements for such expense. | |
Under the Master Lease, Marketing was responsible to pay for the retirement and decommissioning or removal of USTs at the end of their useful life or earlier if circumstances warranted as well as remediation of environmental contamination Marketing caused and all unknown environmental liabilities discovered during the term of the Master Lease (collectively, the “Marketing Environmental Liabilities”). As a result of Marketing’s bankruptcy filing, in the fourth quarter of 2011, we accrued for the Marketing Environmental Liabilities because we concluded that Marketing would not be able to perform them. A liability has not been accrued for environmental obligations that are the responsibility of any of our current tenants based on our tenant’s history of paying such obligations and/or our assessment of their financial ability and intent to pay such costs. However, there can be no assurance that our assessments are correct or that our tenants who have paid their obligations in the past will continue to do so. | |
As part of the triple-net leases for properties previously leased to Marketing, we transferred title of the USTs to our tenants, and the obligation to pay for the retirement and decommissioning or removal of USTs at the end of their useful life or earlier if circumstances warranted was fully or partially transferred to our new tenants. We remain contingently liable for this obligation in the event that our tenants do not satisfy their responsibilities. Accordingly, through September 30, 2014, we removed $13,074,000 of asset retirement obligations and $10,633,000 of net asset retirement costs related to USTs from our balance sheet. The cumulative net amount of $2,441,000 is recorded as deferred rental revenue and will be recognized on a straight-line basis as additional revenues from rental properties over the terms of the various leases. (See note 2 for additional information.) | |
It is possible that our assumptions regarding the ultimate allocation method and share of responsibility that we used to allocate environmental liabilities may change, which may result in material adjustments to the amounts recorded for environmental litigation accruals and environmental remediation liabilities. We are required to accrue for environmental liabilities that we believe are allocable to others under various other agreements if we determine that it is probable that the counterparty will not meet its environmental obligations. The ultimate resolution of these matters could cause a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price. | |
The estimated future costs for known environmental remediation requirements are accrued when it is probable that a liability has been incurred and a reasonable estimate of fair value can be made. The accrued liability is the aggregate of the best estimate of the fair value of cost for each component of the liability net of estimated recoveries from state UST remediation funds considering estimated recovery rates developed from prior experience with the funds. As a result of removals and replacements of USTs, we believe we are likely to incur significant additional environmental remediation costs; however, the amount and timing of such additional costs cannot be predicted and, therefore, no amount has been accrued for in our consolidated financial statements for such expense. | |
Environmental exposures are difficult to assess and estimate for numerous reasons, including the extent of contamination, alternative treatment methods that may be applied, location of the property which subjects it to differing local laws and regulations and their interpretations, as well as the time it takes to remediate contamination. In developing our liability for estimated environmental remediation obligations on a property by property basis, we consider among other things, enacted laws and regulations, assessments of contamination and surrounding geology, quality of information available, currently available technologies for treatment, alternative methods of remediation and prior experience. Environmental accruals are based on estimates which are subject to significant change, and are adjusted as the remediation treatment progresses, as circumstances change and as environmental contingencies become more clearly defined and reasonably estimable. Adjustments to accrued liabilities for environmental remediation obligations will be reflected in our consolidated financial statements as they become probable and a reasonable estimate of fair value can be made. | |
Environmental remediation obligations are initially measured at fair value based on their expected future net cash flows which have been adjusted for inflation and discounted to present value. We adjust our environmental remediation liability quarterly to reflect changes in projected expenditures, accretion and reductions associated with actual expenditures incurred during each quarter. As of September 30, 2014 and December 31, 2013, we had accrued $42,320,000 and $43,472,000, respectively, as our best estimate of the fair value of reasonably estimable environmental remediation obligations and obligations to remove USTs for which we are the title owner, net of estimated recoveries. Environmental liabilities are accreted for the change in present value due to the passage of time and, accordingly, $2,032,000 and $2,119,000 of net accretion expense was recorded for the nine months ended September 30, 2014 and 2013, respectively, which is included in environmental expenses. In addition, during the nine months ended September 30, 2014 and 2013, we recorded credits to environmental expenses included in continuing operations and to earnings from operating activities in discontinued operations in our consolidated statements of operations aggregating $423,000 and $1,031,000, respectively, where decreases in estimated remediation costs exceeded the depreciated carrying value of previously capitalized asset retirement costs. Environmental expenses also include project management fees, legal fees and provisions for environmental litigation losses. | |
During the nine months ended September 30, 2014 and 2013, we increased the carrying value of certain of our properties by $7,801,000 and $8,657,000, respectively, due to increases in estimated remediation costs. The recognition and subsequent changes in estimates in environmental liabilities and the increase or decrease in carrying value of the properties are non-cash transactions which do not appear on the face of the consolidated statements of cash flows. Capitalized asset retirement costs are being depreciated over the estimated remaining life of the underground storage tank, a ten year period if the increase in carrying value related to environmental remediation obligations or such shorter period if circumstances warrant, such as the remaining lease term for properties we lease from others. Depreciation and amortization expense included in continuing operations and earnings from operating activities in discontinued operations in our consolidated statements of operations for the nine months ended September 30, 2014 and 2013 included $1,078,000 and $1,648,000, respectively, of depreciation related to capitalized asset retirement costs. Capitalized asset retirement costs were $17,366,000 and $18,281,000 as of September 30, 2014 and December 31, 2013, respectively. | |
We cannot predict what environmental legislation or regulations may be enacted in the future or how existing laws or regulations will be administered or interpreted with respect to products or activities to which they have not previously been applied. We cannot predict if state UST fund programs will be administered and funded in the future in a manner that is consistent with past practices and if future environmental spending will continue to be eligible for reimbursement at historical recovery rates under these programs. Compliance with more stringent laws or regulations, as well as more vigorous enforcement policies of the regulatory agencies or stricter interpretation of existing laws, which may develop in the future, could have an adverse effect on our financial position, or that of our tenants, and could require substantial additional expenditures for future remediation. | |
In light of the uncertainties associated with environmental expenditure contingencies, we are unable to estimate ranges in excess of the amount accrued with any certainty; however, we believe it is possible that the fair value of future actual net expenditures could be substantially higher than amounts currently recorded by us. Adjustments to accrued liabilities for environmental remediation obligations will be reflected in our consolidated financial statements as they become probable and a reasonable estimate of fair value can be made. Future environmental expenses could cause a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price. |
Shareholders_Equity
Shareholders' Equity | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||
Equity [Abstract] | ' | ||||||||||||||||||||
Shareholders' Equity | ' | ||||||||||||||||||||
6. SHAREHOLDERS’ EQUITY | |||||||||||||||||||||
A summary of the changes in shareholders’ equity for the nine months ended September 30, 2014 is as follows (in thousands, except share amounts): | |||||||||||||||||||||
COMMON STOCK | PAID-IN | DIVIDENDS | TOTAL | ||||||||||||||||||
CAPITAL | PAID | ||||||||||||||||||||
IN EXCESS | |||||||||||||||||||||
OF EARNINGS | |||||||||||||||||||||
SHARES | AMOUNT | ||||||||||||||||||||
Balance, December 31, 2013 | 33,397,260 | $ | 334 | $ | 462,397 | $ | (47,640 | ) | $ | 415,091 | |||||||||||
Net earnings | — | — | — | 26,510 | 26,510 | ||||||||||||||||
Dividends | — | — | — | (20,252 | ) | (20,252 | ) | ||||||||||||||
Stock-based employee compensation expense | 19,613 | — | 661 | — | 661 | ||||||||||||||||
Balance, September 30, 2014 | 33,416,873 | $ | 334 | $ | 463,058 | $ | (41,382 | ) | $ | 422,010 | |||||||||||
On March 3, 2014 and May 13, 2014, respectively, our Board of Directors granted 67,125 and 5,000 restricted stock units to our employees under our 2004 Omnibus Incentive Compensation Plan. | |||||||||||||||||||||
We are authorized to issue 20,000,000 shares of preferred stock, par value $.01 per share, of which none were issued as of September 30, 2014 or December 31, 2013. |
Property_Acquisitions
Property Acquisitions | 9 Months Ended | ||||
Sep. 30, 2014 | |||||
Business Combinations [Abstract] | ' | ||||
Property Acquisitions | ' | ||||
7. PROPERTY ACQUISITIONS | |||||
During the nine months ended September 30, 2014, we acquired fee title to seven gasoline stations and convenience store properties in separate transactions for an aggregate purchase price of $6,800,000. | |||||
We accounted for these acquisitions as business combinations. We estimated the fair value of acquired tangible assets (consisting of land, buildings and equipment) “as if vacant.” Based on these estimates, we allocated $6,455,000 of the purchase price to land, buildings and equipment and $345,000 to in-place leases, favorable financing and other intangible assets. We incurred transaction costs of $53,000 directly related to the acquisitions which are included in general and administrative expenses in our consolidated statements of operations. As of September 30, 2014, our allocations of the purchase price among the assets acquired are preliminary and subject to change. | |||||
On May 9, 2013, we acquired 16 Mobil-branded gasoline station and convenience store properties in the metro New York region and 20 Exxon- and Shell-branded gasoline station and convenience store properties located within the Washington, D.C. “Beltway” for $72,500,000 in two sale/leaseback transactions with subsidiaries of Capitol Petroleum Group, LLC (“Capitol”). The two new triple-net unitary leases have an initial term of 15 years plus three renewal options with provisions for rent escalations during the initial and renewal terms. As triple-net lessees, our tenants are required to pay all expenses pertaining to the properties subject to the unitary leases, including environmental expenses, taxes, assessments, licenses and permit fees, charges for public utilities and all governmental charges. We utilized $11,500,000 of proceeds from 1031 exchanges, $57,500,000 of borrowings under our Credit Agreement and cash on hand to fund this acquisition. | |||||
We accounted for these transactions as business combinations. We estimated the fair value of acquired tangible assets (consisting of land, buildings and equipment) “as if vacant.” Based on these estimates, we allocated $62,365,000 of the purchase price to land, buildings and equipment, $6,267,000 to direct financing leases and $3,868,000 to in-place leases and other intangible assets. We incurred transaction costs of $480,000 directly related to the acquisition which are included in general and administrative expenses in our consolidated statements of operations. | |||||
Unaudited Pro Forma Condensed Consolidated Financial Information | |||||
The following unaudited pro forma condensed consolidated financial information has been prepared utilizing our historical financial statements and the combined effect of additional revenue and expenses from the properties acquired from Capitol assuming that the acquisitions had occurred as of the beginning of the earliest period presented, after giving effect to certain adjustments including: (a) rental income adjustments resulting from the straight-lining of scheduled rent increases; and (b) rental income adjustments resulting from the recognition of revenue under direct financing leases over the lease term using the effective interest rate method which produces a constant periodic rate of return on the net investment in the leased properties. The following information also gives effect to the additional interest expense resulting from the assumed increase in borrowings outstanding under the Credit Agreement to fund the acquisition and the elimination of acquisition costs. The unaudited pro forma condensed financial information is not indicative of the results of operations that would have been achieved had the acquisition from Capitol reflected herein been consummated on the dates indicated or that will be achieved in the future. | |||||
(in thousands, except per share data) | Nine months ended | ||||
September 30, 2013 | |||||
Revenues | $ | 78,011 | |||
Net earnings | $ | 66,257 | |||
Basic and diluted net earnings per common share | $ | 1.98 |
General_Policies
General (Policies) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||
Basis of Presentation | ' | ||||||||||||||||
Basis of Presentation: The consolidated financial statements include the accounts of Getty Realty Corp. and its wholly-owned subsidiaries. We are a real estate investment trust (“REIT”) specializing in the ownership, leasing and financing of retail motor fuel and convenience store properties. The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). We do not distinguish our principal business or our operations on a geographical basis for purposes of measuring performance. We manage and evaluate our operations as a single segment. All significant intercompany accounts and transactions have been eliminated. | |||||||||||||||||
Unaudited, Interim Consolidated Financial Statements | ' | ||||||||||||||||
Unaudited, Interim Consolidated Financial Statements: The consolidated financial statements are unaudited but, in our opinion, reflect all adjustments (consisting of normal recurring accruals) necessary for a fair statement of the results for the periods presented. These statements should be read in conjunction with the consolidated financial statements and related notes which appear in our Annual Report on Form 10-K for the year ended December 31, 2013. | |||||||||||||||||
Use of Estimates, Judgments and Assumptions | ' | ||||||||||||||||
Use of Estimates, Judgments and Assumptions: The consolidated financial statements have been prepared in conformity with GAAP, which requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and revenues and expenses during the period reported. Estimates, judgments and assumptions underlying the accompanying consolidated financial statements include, but are not limited to, receivables, deferred rent receivable, net investment in direct financing leases, environmental remediation costs, real estate, depreciation and amortization, impairment of long-lived assets, litigation, environmental remediation obligations, accrued liabilities, income taxes and the allocation of the purchase price of properties acquired to the assets acquired and liabilities assumed. Application of these estimates and assumptions requires exercise of judgment as to future uncertainties and, as a result, actual results could differ materially from these estimates. | |||||||||||||||||
Subsequent Events | ' | ||||||||||||||||
Subsequent Events: We evaluated subsequent events and transactions for potential recognition or disclosure in our consolidated financial statements. | |||||||||||||||||
New Accounting Pronouncement | ' | ||||||||||||||||
New Accounting Pronouncement: In April 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity (“ASU 2014-08”). This guidance defines a discontinued operation as a component or group of components disposed or classified as held for sale and represents a strategic shift that has (or will have) a major effect on an entity’s operations and final results; the guidance states that a strategic shift could include a disposal of a major geographical area of operations, a major line of business, a major equity method investment or other major parts of an entity. The guidance also provides for additional disclosure requirements in connection with both discontinued operations and other dispositions not qualifying as discontinued operations. The guidance will be effective for annual and interim periods beginning on or after December 15, 2014. The guidance applies prospectively to new disposals and new classifications of disposal groups as held for sale after the effective date. We elected to early adopt this standard effective with the interim period beginning July 1, 2014. Prior to July 1, 2014 properties identified as held for sale and/or disposed of were presented in discontinued operations for all periods presented. | |||||||||||||||||
In May 2014, the FASB issued ASU 2014-09 Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). ASU 2014-09 is a comprehensive new revenue recognition model requiring a company to recognize revenue to depict the transfer of goods or services to a customer at an amount reflecting the consideration it expects to receive in exchange for those goods or services. In adopting ASU 2014-09, companies may use either a full retrospective or a modified retrospective approach. ASU 2014-09 is effective for the first interim period within annual reporting periods beginning after December 15, 2016, and early adoption is not permitted. We are currently in the process of evaluating the impact the adoption of ASU 2014-09 will have on our financial position or results of operations. | |||||||||||||||||
In August 2014, the FASB issued guidance ASU 2014-15, Presentation of Financial Statements – Going Concern: Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. This guidance requires management to evaluate whether there is substantial doubt about the entity’s ability to continue as a going concern and, if so, disclose that fact. This guidance is effective for annual periods ending after December 15, 2016, including interim reporting periods thereafter. The new guidance affects disclosures only and is not expected to have a material impact on our consolidated financial position, results of operations or cash flows. | |||||||||||||||||
Fair Value Hierarchy | ' | ||||||||||||||||
Fair Value Hierarchy: The preparation of consolidated financial statements in accordance with GAAP requires management to make estimates of fair value that affect the reported amounts of assets and liabilities and disclosure of assets and liabilities at the date of the consolidated financial statements and revenues and expenses during the period reported using a hierarchy (the “Fair Value Hierarchy”) that prioritizes the inputs to valuation techniques used to measure the fair value. The Fair Value Hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The levels of the Fair Value Hierarchy are as follows: “Level 1”-inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access at the measurement date; “Level 2”-inputs other than quoted prices that are observable for the asset or liability either directly or indirectly, including inputs in markets that are not considered to be active; and “Level 3”-inputs that are unobservable. Certain types of assets and liabilities are recorded at fair value either on a recurring or non-recurring basis. Assets required or elected to be marked-to-market and reported at fair value every reporting period are valued on a recurring basis. Other assets not required to be recorded at fair value every period may be recorded at fair value if a specific provision or other impairment is recorded within the period to mark the carrying value of the asset to market as of the reporting date. Such assets are valued on a non-recurring basis. | |||||||||||||||||
We had a receivable of $2,972,000 as of December 31, 2012, that was measured at fair value on a recurring basis using Level 3 inputs. Pursuant to the terms of the Litigation Funding Agreement (as defined below), in the third quarter of 2013, we received a payment of $25,096,000 related to this receivable. We elected to account for the advances, accrued interest and litigation reimbursements due to us pursuant to the Litigation Funding Agreement on a fair value basis. We used unobservable inputs based on comparable transactions when determining the fair value of the Litigation Funding Agreement. We concluded that the terms of the Litigation Funding Agreement were within a range of terms representing the market for such arrangements when considering the unique circumstances particular to the counterparties to such funding agreements. These inputs included the potential outcome of the litigation related to the Lukoil Complaint including the probability of the Marketing Estate prevailing in its lawsuit and the potential amount that may be recovered by the Marketing Estate from Lukoil (as such capitalized terms are defined below). We also applied a discount factor commensurate with the risk that the Marketing Estate may not prevail in its lawsuit. We considered that fair value is defined as an amount of consideration that would be exchanged between a willing buyer and seller. Please refer to note 2 of our accompanying consolidated financial statements for additional information regarding Marketing and the Master Lease. | |||||||||||||||||
We have mutual fund assets that are measured at fair value on a recurring basis using Level 1 inputs. We have a Supplemental Retirement Plan for executives and other senior management employees. The amounts held in trust under the Supplemental Retirement Plan using Level 2 inputs may be used to satisfy claims of general creditors in the event of our or any of our subsidiaries’ bankruptcy. We have liability to the employees participating in the Supplemental Retirement Plan for the participant account balances equal to the aggregate of the amount invested at the employees’ direction and the income earned in such mutual funds. | |||||||||||||||||
We have certain real estate assets that are measured at fair value on a non-recurring basis using Level 3 inputs as of September 30, 2014 and December 31, 2013 of $1,758,000 and $9,590,000, respectively, where impairment charges have been recorded. Due to the subjectivity inherent in the internal valuation techniques used in estimating fair value, the amounts realized from the sale of such assets may vary significantly from these estimates. | |||||||||||||||||
The following summarizes as of September 30, 2014 our assets and liabilities measured at fair value on a recurring basis by level within the Fair Value Hierarchy: | |||||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: | |||||||||||||||||
Mutual funds | $ | 758 | $ | — | $ | — | $ | 758 | |||||||||
Liabilities: | |||||||||||||||||
Deferred compensation | $ | — | $ | 758 | $ | — | $ | 758 | |||||||||
The following summarizes as of December 31, 2013 our assets and liabilities measured at fair value on a recurring basis by level within the Fair Value Hierarchy: | |||||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: | |||||||||||||||||
Mutual funds | $ | 3,275 | $ | — | $ | — | $ | 3,275 | |||||||||
Liabilities: | |||||||||||||||||
Deferred compensation | $ | — | $ | 3,275 | $ | — | $ | 3,275 | |||||||||
Fair Value Disclosure of Financial Instruments | ' | ||||||||||||||||
Fair Value Disclosure of Financial Instruments: All of our financial instruments are reflected in the accompanying consolidated balance sheets at amounts which, in our estimation based upon an interpretation of available market information and valuation methodologies, reasonably approximate their fair values, except those separately disclosed in the notes to our consolidated financial statements. | |||||||||||||||||
Discontinued Operations and Assets Held-for-Sale | ' | ||||||||||||||||
Discontinued Operations and Assets Held-for-Sale: We report as discontinued operations 46 properties which meet the criteria to be accounted for as held for sale in accordance with GAAP as of June 30, 2014 and certain properties disposed of during the periods presented that were previously classified as held for sale as of June 30, 2014. All results of these discontinued operations are included in a separate component of income on the consolidated statements of operations under the caption discontinued operations. This has resulted in certain amounts related to discontinued operations in 2013 being reclassified to conform to the 2014 presentation. We elected to early adopt ASU 2014-08 effective July 1, 2014 and, as a result, the results of operations for all qualifying disposals and properties classified as held for sale that were not previously reported in discontinued operations as of June 30, 2014 are presented within income from continuing operations in our consolidated statements of income. | |||||||||||||||||
As a result of a change in circumstances that were previously considered unlikely, we reclassified two properties from held for sale to held and used as the properties no longer met the criteria to be held for sale during the second quarter of 2014. A property that is reclassified to held and used is measured and recorded at the lower of (i) its carrying amount before the property was classified as held for sale, adjusted for any depreciation expense that would have been recognized had the property been continuously classified as held and used, or (ii) the fair value at the date of the subsequent decision not to sell. | |||||||||||||||||
Real estate held for sale classified as discontinued operations consisted of the following at September 30, 2014 and December 31, 2013: | |||||||||||||||||
(in thousands) | September 30, | December 31, | |||||||||||||||
2014 | 2013 | ||||||||||||||||
Land | $ | 6,365 | $ | 15,586 | |||||||||||||
Buildings and improvements | 6,517 | 15,138 | |||||||||||||||
12,882 | 30,724 | ||||||||||||||||
Accumulated depreciation and amortization | (3,210 | ) | (7,740 | ) | |||||||||||||
Real estate held for sale, net | $ | 9,672 | $ | 22,984 | |||||||||||||
The revenue from rental properties, impairment charges, other operating expenses and gains on dispositions of real estate related to these properties are as follows: | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||||
Revenues from rental properties | $ | 686 | $ | 1,324 | $ | 2,450 | $ | 4,409 | |||||||||
Impairment charges | (2,034 | ) | (2,929 | ) | (5,121 | ) | (6,555 | ) | |||||||||
Other operating expenses | (170 | ) | 2,825 | (1,421 | ) | 1,171 | |||||||||||
Earnings (loss) from operating activities | (1,518 | ) | 1,220 | (4,092 | ) | (975 | ) | ||||||||||
Gains on dispositions of real estate | 2,757 | 26,975 | 7,127 | 39,581 | |||||||||||||
Earnings from discontinued operations | $ | 1,239 | $ | 28,195 | $ | 3,035 | $ | 38,606 | |||||||||
For the three months ended September 30, 2014, we sold two properties resulting in a gain of $1,389,000 that previously did not meet the criteria to be classified as held for sale. We determined that the two properties sold did not represent a strategic shift in our operations as defined in ASU 2014-08 and, as a result, the gains on dispositions of real estate for the two properties were not reflected in our earnings from discontinued operations. | |||||||||||||||||
Impairment of Long-Lived Assets and Long-Lived Assets to Be Disposed Of | ' | ||||||||||||||||
Impairment of Long-Lived Assets and Long-Lived Assets to Be Disposed Of: Assets are written down to fair value when events and circumstances indicate that the assets might be impaired and the projected undiscounted cash flows estimated to be generated by those assets are less than the carrying amount of those assets. We review and adjust as necessary our depreciation estimates and method when long-lived assets are tested for recoverability. Assets held for disposal are written down to fair value less estimated disposition costs. | |||||||||||||||||
We recorded non-cash impairment charges aggregating $2,906,000 and $6,583,000 for the three and nine months ended September 30, 2014, respectively, and $3,265,000 and $7,717,000 for the three and nine months ended September 30, 2013, respectively, in continuing operations and in discontinued operations. Our estimated fair values, as it relates to property carrying values were primarily based upon (i) estimated sales prices from third-party offers based on signed contracts, letters of intent or indicative bid and/or consideration of the amount that currently would be required to replace the asset, as adjusted for obsolescence (this method was used to determine $3,103,000 of the $6,583,000 in impairments recognized during the nine months ended September 30, 2014), for which we do not have access to the unobservable inputs used to determine these estimated fair values, (ii) discounted cash flow models (this method was used to determine $518,000 of the $6,583,000 in impairments recognized during the nine months ended September 30, 2014) and (iii) the accumulation of asset retirement costs as a result of increases in estimated environmental liabilities which increased the carrying value of certain properties in excess of their fair value (this method was used to determine $2,962,000 of the $6,583,000 in impairments recognized during the nine months ended September 30, 2014). The non-cash impairment charges recorded during the three and nine months ended September 30, 2014 and 2013 were attributable to reductions in estimated undiscounted cash flows expected to be received during the assumed holding period, reductions in our estimates of value for properties held for sale and the accumulation of asset retirement costs as a result of increases in estimated environmental liabilities which increased the carrying value of certain properties in excess of their fair value. The estimated fair value of real estate is based on the price that would be received from the sale of the property in an orderly transaction between market participants at the measurement date. In general, we consider multiple internal valuation techniques when measuring the fair value of a property, all of which are based on unobservable inputs and assumptions that are classified within Level 3 of the Fair Value Hierarchy. These unobservable inputs include assumed holding periods ranging up to 15 years, assumed average rent increases of 2.0% annually, income capitalized at a rate of 8.0% and cash flows discounted at a rate of 7.0%. These assessments have a direct impact on our net income because recording an impairment loss results in an immediate negative adjustment to net income. The evaluation of anticipated cash flows is highly subjective and is based in part on assumptions regarding future rental rates and operating expenses that could differ materially from actual results in future periods. Where properties held for use have been identified as having a potential for sale, additional judgments are required related to the determination as to the appropriate period over which the projected undiscounted cash flows should include the operating cash flows and the amount included as the estimated residual value. This requires significant judgment. In some cases, the results of whether impairment is indicated are sensitive to changes in assumptions input into the estimates, including the holding period until expected sale. | |||||||||||||||||
Deferred Rent Receivable and Revenue Recognition | ' | ||||||||||||||||
Deferred Rent Receivable and Revenue Recognition: We earn rental income under operating and direct financing leases with tenants. Minimum lease payments from operating leases are recognized on a straight-line basis over the term of the leases. The cumulative difference between lease revenue recognized under this method and the contractual lease payment terms is recorded as deferred rent receivable on our consolidated balance sheets. We provide reserves for a portion of the recorded deferred rent receivable if circumstances indicate that it is not reasonable to assume that the tenant will make all of its contractual lease payments when due during the current term of the lease. We make estimates of the collectability of our accounts receivable related to revenue from rental properties. We analyze accounts receivable and historical bad debt levels, customer creditworthiness and current economic trends when evaluating the adequacy of the allowance for doubtful accounts. Additionally, with respect to tenants in bankruptcy, we estimate the expected recovery through bankruptcy claims and increase the allowance for amounts deemed uncollectible. If our assumptions regarding the collectability of accounts receivable prove incorrect, we could experience write-offs of the accounts receivable or deferred rent receivable in excess of our allowance for doubtful accounts. Lease termination fees are recognized as rental income when earned upon the termination of a tenant’s lease and relinquishment of space in which we have no further obligation to the tenant. The present value of the difference between the fair market rent and the contractual rent for above-market and below-market leases at the time properties are acquired is amortized into revenue from rental properties over the remaining lives of the in-place leases. | |||||||||||||||||
Direct Financing Leases | ' | ||||||||||||||||
Direct Financing Leases: Income under direct financing leases is included in revenues from rental properties and is recognized over the lease terms using the effective interest rate method which produces a constant periodic rate of return on the net investments in the leased properties. Net investment in direct financing leases represents the investments in leased assets accounted for as direct financing leases. The investments in direct financing leases are increased for interest income earned and amortized over the life of the leases and reduced by the receipt of lease payments. We consider direct financing leases to be past-due or delinquent when a contractually required payment is not remitted in accordance with the provisions of the underlying agreement. We evaluate each account individually and set up an allowance when, based upon current information and events, it is probable that we will be unable to collect all amounts due according to the existing contractual terms, and the amount can be reasonably estimated. | |||||||||||||||||
We review our direct financing leases at least annually to determine whether there has been an-other-than-temporary decline in the current estimate of residual value of the property. The residual value is our estimate of what we could realize upon the sale of the property at the end of the lease term, based on market information and third-party estimates where available. If this review indicates that a decline in residual value has occurred that is other-than-temporary, we recognize an impairment charge. There were no impairments of any of our direct financing leases during the three and nine months ended September 30, 2014 and 2013. | |||||||||||||||||
When we enter into a contract to sell properties that are recorded as direct financing leases, we evaluate whether we believe it is probable that the disposition will occur. If we determine that the disposition is probable and therefore the property’s holding period is reduced, we record an allowance for credit losses to reflect the change in the estimate of the undiscounted future rents. Accordingly, the net investment balance is written down to fair value. | |||||||||||||||||
Notes and Mortgages Receivable | ' | ||||||||||||||||
Notes and Mortgages Receivable: Notes and mortgages receivable consists of loans originated by us in conjunction with property dispositions and funding provided to tenants in conjunction with property acquisitions. Notes and mortgages receivable are recorded at stated principal amounts. We evaluate the collectability of both interest and principal on each loan to determine whether it is impaired. A loan is considered to be impaired when, based upon current information and events, it is probable that we will be unable to collect all amounts due under the existing contractual terms. When a loan is considered to be impaired, the amount of loss is calculated by comparing the recorded investment to the fair value determined by discounting the expected future cash flows at the loan’s effective interest rate or to the fair value of the underlying collateral, if the loan is collateralized. Interest income on performing loans is accrued as earned. Interest income on impaired loans is recognized on a cash basis. We do not provide for an additional allowance for loan losses based on the grouping of loans as we believe the characteristics of the loans are not sufficiently similar to allow an evaluation of these loans as a group for a possible loan loss allowance. As such, all of our loans are evaluated individually for impairment purposes. | |||||||||||||||||
As of June 30, 2014, we had one loan aggregating $475,000 (including amounts held in escrow) which was in default for nonpayment of principal and interest. We assessed this loan and recorded an allowance for mortgage receivable in the amount of $133,000 at June 30, 2014. This reserve reflected a decrease in the estimated fair value of the underlying collateral. During the quarter ended September 30, 2014, we received partial payment of $75,000 on the loan that was previously impaired and issued a new loan for $400,000 with substantially the same terms as the prior loan. Accordingly, the allowance for loan losses of $35,000 was written off at September 30, 2014. | |||||||||||||||||
Environmental Remediation Obligations | ' | ||||||||||||||||
Environmental Remediation Obligations: The estimated future costs for known environmental remediation requirements are accrued when it is probable that a liability has been incurred, including legal obligations associated with the retirement of tangible long-lived assets if the asset retirement obligation results from the normal operation of those assets and a reasonable estimate of fair value can be made. Environmental remediation obligations are estimated based on the level and impact of contamination at each property. The accrued liability is the aggregate of the best estimate of the fair value of cost for each component of the liability. The accrued liability is net of recoveries of environmental costs from state underground storage tank (“UST” or “USTs”) remediation funds with respect to both past and future environmental spending based on estimated recovery rates developed from prior experience with the funds. Net environmental liabilities are currently measured based on their expected future cash flows which have been adjusted for inflation and discounted to present value. We accrue for environmental liabilities that we believe are allocable to other potentially responsible parties if it becomes probable that the other parties will not pay their environmental remediation obligations. | |||||||||||||||||
Income Taxes | ' | ||||||||||||||||
Income Taxes: We and our subsidiaries file a consolidated federal income tax return. Effective January 1, 2001, we elected to qualify, and believe we are operating so as to qualify, as a REIT for federal income tax purposes. Accordingly, we generally will not be subject to federal income tax on qualifying REIT income, provided that distributions to our shareholders equal at least the amount of our taxable income as defined under the Internal Revenue Code. We accrue for uncertain tax matters when appropriate. The accrual for uncertain tax positions is adjusted as circumstances change and as the uncertainties become more clearly defined, such as when audits are settled or exposures expire. Tax returns for the years 2010, 2011, 2012 and 2013, and tax returns which will be filed for the year ended 2014, remain open to examination by federal and state tax jurisdictions under the respective statute of limitations. | |||||||||||||||||
In the third quarter of 2013, we submitted to the Internal Revenue Service (“IRS”) a request seeking a ruling that a portion of the payments we received from the Marketing Estate, including amounts related to the Litigation Funding Agreement (see note 2 for additional information regarding the Lukoil Settlement and the Litigation Funding Agreement), be treated either as qualifying income or excluded from gross income for the purposes of the REIT qualification gross income tests either as a matter of law or pursuant to the discretionary authority granted by Congress to the IRS to determine whether certain types of income are an outgrowth of a REIT’s business of owning and operating real estate. In January 2014, we received a favorable ruling from the IRS indicating that a portion of the payments received from the Marketing Estate will be treated as qualifying income and the remainder will be excluded from gross income for the purposes of the REIT qualification gross income tests. Therefore, none of the cash flow received from the Marketing Estate, including amounts related to the Litigation Funding Agreement, will be treated as non-qualifying income for purposes of the REIT qualification gross income tests. | |||||||||||||||||
Earnings per Common Share | ' | ||||||||||||||||
Earnings per Common Share: Basic earnings per common share gives effect, utilizing the two-class method, to the potential dilution from the issuance of common shares in settlement of restricted stock units (“RSU” or “RSUs”) which provide for non-forfeitable dividend equivalents equal to the dividends declared per common share. Basic earnings per common share is computed by dividing net earnings less dividend equivalents attributable to RSUs by the weighted-average number of common shares outstanding during the year. Diluted earnings per common share, also gives effect to the potential dilution from the exercise of stock options utilizing the treasury stock method. There were 5,000 stock options excluded from the earnings per share calculations below as they were anti-dilutive as of September 30, 2014 and 2013, respectively. | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||||
Earnings from continuing operations | $ | 8,996 | $ | 13,682 | $ | 23,475 | $ | 26,360 | |||||||||
Less dividend equivalents attributable to RSUs outstanding | (89 | ) | (120 | ) | (232 | ) | (232 | ) | |||||||||
Earnings from continuing operations attributable to common shareholders | 8,907 | 13,562 | 23,243 | 26,128 | |||||||||||||
Earnings from discontinued operations | 1,239 | 28,195 | 3,035 | 38,606 | |||||||||||||
Less dividend equivalents attributable to RSUs outstanding | (12 | ) | (248 | ) | (39 | ) | (339 | ) | |||||||||
Earnings from discontinued operations attributable to common shareholders | 1,227 | 27,947 | 2,996 | 38,267 | |||||||||||||
Net earnings attributable to common shareholders used for basic and diluted earnings per share calculation | $ | 10,134 | $ | 41,509 | $ | 26,239 | $ | 64,395 | |||||||||
Weighted-average number of common shares outstanding: | |||||||||||||||||
Basic | 33,417 | 33,397 | 33,406 | 33,397 | |||||||||||||
Stock options | — | — | — | — | |||||||||||||
Diluted | 33,417 | 33,397 | 33,406 | 33,397 | |||||||||||||
RSUs outstanding at the end of the period | 333 | 296 | 333 | 296 | |||||||||||||
Dividends | ' | ||||||||||||||||
Dividends: For the nine months ended September 30, 2014 and 2013, we paid cash dividends of $21,925,000 or $0.65 per share (which consisted of $20,240,000 or $0.60 per share of regular quarterly cash dividends and a $1,685,000 or $0.05 per share special cash dividend) and $17,680,000 or $0.525 per share, respectively | |||||||||||||||||
Revision | ' | ||||||||||||||||
Revision: As previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2013, we identified and corrected an error in which we inappropriately classified certain rental property expenses as discontinued operations. The error resulted in a reclassification of $933,000 and $1,726,000 of rental property expenses to continuing operations in our statements of operations for the three and nine months ended September 30, 2013. The effect of this error had no impact on our net income, consolidated balance sheets or statements of cash flows. For purposes of this Quarterly Report on Form 10-Q, we have revised our results for the three and nine months ended September 30, 2013 as presented below. Certain reclassifications have also been made to the prior period amounts to conform to the current period presentation. | |||||||||||||||||
The effect of these revisions is shown below (in thousands): | |||||||||||||||||
THREE MONTHS ENDED September 30, 2013 | As previously | Reclassifications | Revisions | As revised | |||||||||||||
reported | |||||||||||||||||
Revenues from rental properties | $ | 25,425 | $ | (733 | ) | $ | — | $ | 24,692 | ||||||||
Earnings from continuing operations | 15,295 | (680 | ) | (933 | ) | 13,682 | |||||||||||
Net earnings | 41,877 | — | — | 41,877 | |||||||||||||
NINE MONTHS ENDED September 30, 2013 | As previously | Reclassifications | Revisions | As revised | |||||||||||||
reported | |||||||||||||||||
Revenues from rental properties | $ | 72,360 | $ | (2,224 | ) | $ | — | $ | 70,136 | ||||||||
Earnings from continuing operations | 29,031 | (945 | ) | (1,726 | ) | 26,360 | |||||||||||
Net earnings | 64,966 | — | — | 64,966 | |||||||||||||
Out-of-Period Adjustment | ' | ||||||||||||||||
Out-of-Period Adjustment: We corrected a misstatement in our recording of prepaid real estate taxes and real estate tax expense for the year ended 2013, which decreased our net earnings by $420,000 during the quarter ended March 31, 2014. We concluded that these adjustments were not material to our results for this or any of the prior periods. |
General_Tables
General (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis | ' | ||||||||||||||||
The following summarizes as of September 30, 2014 our assets and liabilities measured at fair value on a recurring basis by level within the Fair Value Hierarchy: | |||||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: | |||||||||||||||||
Mutual funds | $ | 758 | $ | — | $ | — | $ | 758 | |||||||||
Liabilities: | |||||||||||||||||
Deferred compensation | $ | — | $ | 758 | $ | — | $ | 758 | |||||||||
The following summarizes as of December 31, 2013 our assets and liabilities measured at fair value on a recurring basis by level within the Fair Value Hierarchy: | |||||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: | |||||||||||||||||
Mutual funds | $ | 3,275 | $ | — | $ | — | $ | 3,275 | |||||||||
Liabilities: | |||||||||||||||||
Deferred compensation | $ | — | $ | 3,275 | $ | — | $ | 3,275 | |||||||||
Schedule of Real Estate Held for Sale | ' | ||||||||||||||||
Real estate held for sale classified as discontinued operations consisted of the following at September 30, 2014 and December 31, 2013: | |||||||||||||||||
(in thousands) | September 30, | December 31, | |||||||||||||||
2014 | 2013 | ||||||||||||||||
Land | $ | 6,365 | $ | 15,586 | |||||||||||||
Buildings and improvements | 6,517 | 15,138 | |||||||||||||||
12,882 | 30,724 | ||||||||||||||||
Accumulated depreciation and amortization | (3,210 | ) | (7,740 | ) | |||||||||||||
Real estate held for sale, net | $ | 9,672 | $ | 22,984 | |||||||||||||
Schedule of Earnings (Loss) from Discontinued Operations | ' | ||||||||||||||||
The revenue from rental properties, impairment charges, other operating expenses and gains on dispositions of real estate related to these properties are as follows: | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||||
Revenues from rental properties | $ | 686 | $ | 1,324 | $ | 2,450 | $ | 4,409 | |||||||||
Impairment charges | (2,034 | ) | (2,929 | ) | (5,121 | ) | (6,555 | ) | |||||||||
Other operating expenses | (170 | ) | 2,825 | (1,421 | ) | 1,171 | |||||||||||
Earnings (loss) from operating activities | (1,518 | ) | 1,220 | (4,092 | ) | (975 | ) | ||||||||||
Gains on dispositions of real estate | 2,757 | 26,975 | 7,127 | 39,581 | |||||||||||||
Earnings from discontinued operations | $ | 1,239 | $ | 28,195 | $ | 3,035 | $ | 38,606 | |||||||||
Schedule of Earnings Per Share | ' | ||||||||||||||||
Diluted earnings per common share, also gives effect to the potential dilution from the exercise of stock options utilizing the treasury stock method. There were 5,000 stock options excluded from the earnings per share calculations below as they were anti-dilutive as of September 30, 2014 and 2013, respectively. | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||||
Earnings from continuing operations | $ | 8,996 | $ | 13,682 | $ | 23,475 | $ | 26,360 | |||||||||
Less dividend equivalents attributable to RSUs outstanding | (89 | ) | (120 | ) | (232 | ) | (232 | ) | |||||||||
Earnings from continuing operations attributable to common shareholders | 8,907 | 13,562 | 23,243 | 26,128 | |||||||||||||
Earnings from discontinued operations | 1,239 | 28,195 | 3,035 | 38,606 | |||||||||||||
Less dividend equivalents attributable to RSUs outstanding | (12 | ) | (248 | ) | (39 | ) | (339 | ) | |||||||||
Earnings from discontinued operations attributable to common shareholders | 1,227 | 27,947 | 2,996 | 38,267 | |||||||||||||
Net earnings attributable to common shareholders used for basic and diluted earnings per share calculation | $ | 10,134 | $ | 41,509 | $ | 26,239 | $ | 64,395 | |||||||||
Weighted-average number of common shares outstanding: | |||||||||||||||||
Basic | 33,417 | 33,397 | 33,406 | 33,397 | |||||||||||||
Stock options | — | — | — | — | |||||||||||||
Diluted | 33,417 | 33,397 | 33,406 | 33,397 | |||||||||||||
RSUs outstanding at the end of the period | 333 | 296 | 333 | 296 | |||||||||||||
Schedule of Effect of Revisions | ' | ||||||||||||||||
The effect of these revisions is shown below (in thousands): | |||||||||||||||||
THREE MONTHS ENDED September 30, 2013 | As previously | Reclassifications | Revisions | As revised | |||||||||||||
reported | |||||||||||||||||
Revenues from rental properties | $ | 25,425 | $ | (733 | ) | $ | — | $ | 24,692 | ||||||||
Earnings from continuing operations | 15,295 | (680 | ) | (933 | ) | 13,682 | |||||||||||
Net earnings | 41,877 | — | — | 41,877 | |||||||||||||
NINE MONTHS ENDED September 30, 2013 | As previously | Reclassifications | Revisions | As revised | |||||||||||||
reported | |||||||||||||||||
Revenues from rental properties | $ | 72,360 | $ | (2,224 | ) | $ | — | $ | 70,136 | ||||||||
Earnings from continuing operations | 29,031 | (945 | ) | (1,726 | ) | 26,360 | |||||||||||
Net earnings | 64,966 | — | — | 64,966 |
Leases_Tables
Leases (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
White Oak Petroleum, LLC, Hudson Petroleum Realty, LLC, Dogwood Petroleum Realty, LLC and Big Apple Petroleum Realty, LLC [Member] | ' | ||||||||||||||||
Summary of Selected Financial Data | ' | ||||||||||||||||
The selected combined unaudited financial data of CPD NY and NECG, which has been prepared by Chestnut Petroleum Dist. Inc.’s management, is provided below: | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||||
Operating Data: | |||||||||||||||||
Total revenue | $ | 144,942 | $ | 143,191 | $ | 419,338 | $ | 410,182 | |||||||||
Gross profit | 12,130 | 10,054 | 32,313 | 29,841 | |||||||||||||
Net income | 541 | 1,243 | 1,240 | 2,702 | |||||||||||||
September 30, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Balance Sheet Data: | |||||||||||||||||
Current assets | $ | 12,579 | $ | 10,944 | |||||||||||||
Noncurrent assets | 30,096 | 28,852 | |||||||||||||||
Current liabilities | 15,624 | 13,985 | |||||||||||||||
Noncurrent liabilities | 16,043 | 16,043 | |||||||||||||||
CPD NY and NECG [Member] | ' | ||||||||||||||||
Summary of Selected Financial Data | ' | ||||||||||||||||
The selected combined unaudited financial data of White Oak Petroleum, LLC, Hudson Petroleum Realty, LLC, Dogwood Petroleum Realty, LLC and Big Apple Petroleum Realty, LLC, which has been prepared by Capitol Petroleum Group, LLC’s management, is provided below: | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | |||||||||||||
Operating Data: | |||||||||||||||||
Total revenue | $ | 89,830 | $ | 91,135 | $ | 266,933 | $ | 268,880 | |||||||||
Gross profit | 2,341 | 2,338 | 5,753 | 9,724 | |||||||||||||
Net loss | (870 | ) | (783 | ) | (3,918 | ) | (1,363 | ) | |||||||||
September 30, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Balance Sheet Data: | |||||||||||||||||
Current assets | $ | 6,254 | $ | 10,128 | |||||||||||||
Noncurrent assets | 108,808 | 111,540 | |||||||||||||||
Current liabilities | 8,578 | 10,880 | |||||||||||||||
Noncurrent liabilities | 135,383 | 135,210 |
Shareholders_Equity_Tables
Shareholders' Equity (Tables) | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||
Equity [Abstract] | ' | ||||||||||||||||||||
Summary of Changes in Shareholders' Equity | ' | ||||||||||||||||||||
A summary of the changes in shareholders’ equity for the nine months ended September 30, 2014 is as follows (in thousands, except share amounts): | |||||||||||||||||||||
COMMON STOCK | PAID-IN | DIVIDENDS | TOTAL | ||||||||||||||||||
CAPITAL | PAID | ||||||||||||||||||||
IN EXCESS | |||||||||||||||||||||
OF EARNINGS | |||||||||||||||||||||
SHARES | AMOUNT | ||||||||||||||||||||
Balance, December 31, 2013 | 33,397,260 | $ | 334 | $ | 462,397 | $ | (47,640 | ) | $ | 415,091 | |||||||||||
Net earnings | — | — | — | 26,510 | 26,510 | ||||||||||||||||
Dividends | — | — | — | (20,252 | ) | (20,252 | ) | ||||||||||||||
Stock-based employee compensation expense | 19,613 | — | 661 | — | 661 | ||||||||||||||||
Balance, September 30, 2014 | 33,416,873 | $ | 334 | $ | 463,058 | $ | (41,382 | ) | $ | 422,010 | |||||||||||
Property_Acquisitions_Tables
Property Acquisitions (Tables) | 9 Months Ended | ||||
Sep. 30, 2014 | |||||
Business Combinations [Abstract] | ' | ||||
Pro Forma Condensed Financial Information | ' | ||||
The unaudited pro forma condensed financial information is not indicative of the results of operations that would have been achieved had the acquisition from Capitol reflected herein been consummated on the dates indicated or that will be achieved in the future. | |||||
(in thousands, except per share data) | Nine months ended | ||||
September 30, 2013 | |||||
Revenues | $ | 78,011 | |||
Net earnings | $ | 66,257 | |||
Basic and diluted net earnings per common share | $ | 1.98 |
General_Additional_Information
General - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | 3 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||||
Jun. 30, 2014 | Sep. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2012 | Sep. 30, 2014 | Dec. 31, 2013 | |
Property | Property | Property | Estimated Sale Price Method [Member] | Discounted Cash Flow Method [Member] | Accumulation of Asset Retirement Cost Method [Member] | Litigation Funding Agreement [Member] | Stock Options [Member] | Stock Options [Member] | Reclassifications [Member] | Reclassifications [Member] | Loan in Default for Nonpayment [Member] | Loan in Default for Nonpayment [Member] | Loan in Default for Nonpayment [Member] | Finance Leases Financing Receivable [Member] | Finance Leases Financing Receivable [Member] | Level 3 [Member] | Level 3 [Member] | Level 3 [Member] | Level 3 [Member] | ||||
MortgageLoan | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Measurements, Nonrecurring [Member] | ||||||||||||||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Legal settlements received | ' | ' | ' | $3,126,000 | ' | $3,126,000 | ' | ' | ' | $25,096,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accounts receivable measured at fair value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,972,000 | ' | ' |
Impaired real estate assets measured at fair value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,758,000 | 9,590,000 |
Number of real estate properties held for sale | 46 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of properties reclassified | ' | 2 | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of properties sold | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gain from sale of properties | ' | 1,389,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Impairment charges | ' | 2,906,000 | ' | 3,265,000 | 6,583,000 | 7,717,000 | 3,103,000 | 518,000 | 2,962,000 | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | ' | ' | ' | ' |
Estimated fair value | ' | ' | ' | ' | ' | ' | 6,583,000 | 6,583,000 | 6,583,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Assumed holding periods for unobservable inputs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '15 years | ' | ' | ' |
Assumed annual average rent increases for unobservable inputs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.00% | ' | ' | ' |
Rate of income capitalization for unobservable inputs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.00% | ' | ' | ' |
Cash flows discounted rate for unobservable inputs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7.00% | ' | ' | ' |
Outstanding loan amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 475,000 | ' | ' | ' | ' | ' | ' |
Number of mortgage loans | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' |
Allowance for mortgages receivable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 133,000 | ' | ' | ' | ' | ' | ' |
Partial amount received on mortgage loan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 75,000 | ' | ' | ' | ' | ' | ' | ' |
Issuance of new mortgage loan | ' | ' | ' | ' | 400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Allowance for loan losses written off | ' | ' | ' | ' | 35,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Anti-dilutive securities Excluded from calculation of EPS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,000 | 5,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash dividends | ' | ' | ' | ' | 21,925,000 | 17,680,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash dividends per share | ' | ' | ' | ' | $0.65 | $0.53 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Payment of regular quarterly cash dividend | ' | ' | ' | ' | 20,240,000 | 20,240,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Payment of special cash dividend | ' | ' | ' | ' | 1,685,000 | 1,685,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Regular quarterly cash dividends paid per share | ' | ' | ' | ' | $0.60 | $0.60 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Special cash dividends paid per share | ' | ' | ' | ' | $0.05 | $0.05 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Rental property expenses | ' | 5,538,000 | ' | 7,085,000 | 17,420,000 | 21,525,000 | ' | ' | ' | ' | ' | ' | 933,000 | 1,726,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Adjustment which decreased net earnings | ' | ' | $420,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
General_Schedule_of_Assets_and
General - Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) (Fair Value, Measurements, Recurring [Member], USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Mutual Funds [Member] | ' | ' |
Fair Value Assets Liabilities Measured On Recurring Basis [Line Items] | ' | ' |
Fair value of assets | $758 | $3,275 |
Deferred Compensation [Member] | ' | ' |
Fair Value Assets Liabilities Measured On Recurring Basis [Line Items] | ' | ' |
Fair value of liabilities | 758 | 3,275 |
Level 1 [Member] | Mutual Funds [Member] | ' | ' |
Fair Value Assets Liabilities Measured On Recurring Basis [Line Items] | ' | ' |
Fair value of assets | 758 | 3,275 |
Level 1 [Member] | Deferred Compensation [Member] | ' | ' |
Fair Value Assets Liabilities Measured On Recurring Basis [Line Items] | ' | ' |
Fair value of liabilities | ' | ' |
Level 2 [Member] | Mutual Funds [Member] | ' | ' |
Fair Value Assets Liabilities Measured On Recurring Basis [Line Items] | ' | ' |
Fair value of assets | ' | ' |
Level 2 [Member] | Deferred Compensation [Member] | ' | ' |
Fair Value Assets Liabilities Measured On Recurring Basis [Line Items] | ' | ' |
Fair value of liabilities | 758 | 3,275 |
Level 3 [Member] | Mutual Funds [Member] | ' | ' |
Fair Value Assets Liabilities Measured On Recurring Basis [Line Items] | ' | ' |
Fair value of assets | ' | ' |
Level 3 [Member] | Deferred Compensation [Member] | ' | ' |
Fair Value Assets Liabilities Measured On Recurring Basis [Line Items] | ' | ' |
Fair value of liabilities | ' | ' |
General_Schedule_of_Real_Estat
General - Schedule of Real Estate Held for Sale (Detail) (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 |
Real Estate Held For Sale [Line Items] | ' | ' |
Real estate assets held for sale | $12,882 | $30,724 |
Accumulated depreciation and amortization | -3,210 | -7,740 |
Real estate held for sale, net | 9,672 | 22,984 |
Land [Member] | ' | ' |
Real Estate Held For Sale [Line Items] | ' | ' |
Real estate assets held for sale | 6,365 | 15,586 |
Buildings and Improvements [Member] | ' | ' |
Real Estate Held For Sale [Line Items] | ' | ' |
Real estate assets held for sale | $6,517 | $15,138 |
General_Schedule_of_Earnings_L
General - Schedule of Earnings (Loss) from Discontinued Operations (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Discontinued Operations and Disposal Groups [Abstract] | ' | ' | ' | ' |
Revenues from rental properties | $686 | $1,324 | $2,450 | $4,409 |
Impairment charges | -2,034 | -2,929 | -5,121 | -6,555 |
Other operating expenses | -170 | 2,825 | -1,421 | 1,171 |
Earnings (loss) from operating activities | -1,518 | 1,220 | -4,092 | -975 |
Gains on dispositions of real estate | 2,757 | 26,975 | 7,127 | 39,581 |
Earnings from discontinued operations | $1,239 | $28,195 | $3,035 | $38,606 |
General_Schedule_of_Earnings_P
General - Schedule of Earnings Per Share (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Earnings Per Share [Abstract] | ' | ' | ' | ' |
Earnings from continuing operations | $8,996 | $13,682 | $23,475 | $26,360 |
Less dividend equivalents attributable to RSUs outstanding | -89 | -120 | -232 | -232 |
Earnings from continuing operations attributable to common shareholders | 8,907 | 13,562 | 23,243 | 26,128 |
Earnings from discontinued operations | 1,239 | 28,195 | 3,035 | 38,606 |
Less dividend equivalents attributable to RSUs outstanding | -12 | -248 | -39 | -339 |
Earnings from discontinued operations attributable to common shareholders | 1,227 | 27,947 | 2,996 | 38,267 |
Net earnings attributable to common shareholders used for basic and diluted earnings per share calculation | $10,134 | $41,509 | $26,239 | $64,395 |
Basic | 33,417 | 33,397 | 33,406 | 33,397 |
Stock options | ' | ' | ' | ' |
Diluted | 33,417 | 33,397 | 33,406 | 33,397 |
RSUs outstanding at the end of the period | 333 | 296 | 333 | 296 |
General_Schedule_of_Effect_of_
General - Schedule of Effect of Revisions (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Quarterly Financial Information [Line Items] | ' | ' | ' | ' |
Revenues from rental properties | $24,014 | $24,692 | $71,911 | $70,136 |
Earnings from continuing operations | 8,996 | 13,682 | 23,475 | 26,360 |
Net earnings | 10,235 | 41,877 | 26,510 | 64,966 |
As Previously Reported [Member] | ' | ' | ' | ' |
Quarterly Financial Information [Line Items] | ' | ' | ' | ' |
Revenues from rental properties | ' | 25,425 | ' | 72,360 |
Earnings from continuing operations | ' | 15,295 | ' | 29,031 |
Net earnings | ' | 41,877 | ' | 64,966 |
Reclassifications [Member] | ' | ' | ' | ' |
Quarterly Financial Information [Line Items] | ' | ' | ' | ' |
Revenues from rental properties | ' | -733 | ' | -2,224 |
Earnings from continuing operations | ' | -680 | ' | -945 |
Revisions [Member] | ' | ' | ' | ' |
Quarterly Financial Information [Line Items] | ' | ' | ' | ' |
Earnings from continuing operations | ' | ($933) | ' | ($1,726) |
Leases_Additional_Information_
Leases - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Property | Property | ||||
State | State | ||||
Leases [Line Items] | ' | ' | ' | ' | ' |
Number of properties in portfolio | 888 | ' | 888 | ' | ' |
Number of states in which our properties are located | 20 | ' | 20 | ' | ' |
Revenues from rental properties included in continuing operations | $24,014 | $24,692 | $71,911 | $70,136 | ' |
Rental property expenses included in continuing operations | 3,721 | 3,666 | 9,809 | 10,452 | ' |
Revenues from rental properties | 19,486 | 18,896 | 57,573 | 54,039 | ' |
Other revenue | ' | 3,126 | ' | 3,126 | ' |
Rental revenue increase due to revenue recognition adjustments included in continuing operations | 807 | 2,130 | 4,529 | 5,645 | ' |
Investment in direct financing lease | 96,143 | ' | 96,143 | ' | 97,147 |
Investments in direct financing lease, minimum lease payments receivable | 194,501 | ' | 194,501 | ' | 203,438 |
Investment in direct financing lease, unguaranteed estimated residual value | 13,979 | ' | 13,979 | ' | 13,979 |
Investment in direct financing lease, deferred income | 112,337 | ' | 112,337 | ' | 120,270 |
Third Parties [Member] | ' | ' | ' | ' | ' |
Leases [Line Items] | ' | ' | ' | ' | ' |
Number of properties previously leased | 112 | ' | 112 | ' | ' |
Judicial Ruling [Member] | ' | ' | ' | ' | ' |
Leases [Line Items] | ' | ' | ' | ' | ' |
Other revenue | ' | $3,126 | ' | $3,126 | ' |
Owned Properties [Member] | ' | ' | ' | ' | ' |
Leases [Line Items] | ' | ' | ' | ' | ' |
Number of properties | 776 | ' | 776 | ' | ' |
Leases_Marketing_and_the_Maste
Leases - Marketing and the Master Lease - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 1 Months Ended | 0 Months Ended | 3 Months Ended | 1 Months Ended | 9 Months Ended | ||||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2013 | Aug. 31, 2013 | Jul. 29, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Aug. 31, 2013 | Oct. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2014 |
Getty Petroleum Marketing [Member] | Getty Petroleum Marketing [Member] | Litigation Funding Agreement [Member] | Post Petition Priority Claims [Member] | Marketing Estate [Member] | Marketing Estate [Member] | Marketing Estate [Member] | Marketing Estate [Member] | Marketing Estate [Member] | Marketing Estate [Member] | Marketing Estate [Member] | Marketing Estate [Member] | |||||
Property | Master Lease [Member] | Scenario, Forecast [Member] | Accounts Receivable [Member] | Bad Debt Reserve for Uncollectible Amounts [Member] | Additional Income Attributed To Master Lease [Member] | Litigation Funding Agreement [Member] | Litigation Funding Agreement [Member] | Litigation Funding Agreement [Member] | Litigation Funding Agreement [Member] | |||||||
Legal Fees [Member] | ||||||||||||||||
Leases [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of properties previously leased to GPMI | ' | ' | ' | ' | 510 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
General and administrative expense | $3,865 | $6,361 | $11,984 | $16,750 | $653 | $3,962 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum dollar amount of loans to the Marketing Estate per agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,725 | ' | ' |
Amount advanced to the Marketing Estate for wind down expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,526 | ' |
Collective payment by or on behalf of the defendants | ' | $3,126 | ' | $3,126 | ' | ' | $25,096 | $6,585 | $93,000 | $7,976 | $13,994 | $3,126 | $25,096 | ' | ' | $1,300 |
Leases_Leasing_Activities_Addi
Leases - Leasing Activities - Additional Information (Detail) (USD $) | 9 Months Ended | ||
Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | |
Property | |||
Portfolios | |||
Leases [Line Items] | ' | ' | ' |
Number of new triple net leases we've entered into | 13 | ' | ' |
Number of leased properties with new tenants | 452 | ' | ' |
Properties under license agreements | 29 | ' | ' |
Maximum lease commitment for capital expenditure | $15,263,000 | ' | ' |
Amount of asset retirement obligations removed from the balance sheet | 13,074,000 | ' | ' |
Deferred rental revenue | 2,441,000 | ' | ' |
Lease origination costs | 60,000 | ' | 365,000 |
Investment of capital commitment | 962,000 | 308,000 | ' |
Minimum [Member] | ' | ' | ' |
Leases [Line Items] | ' | ' | ' |
Unitary triple-net lease agreements initial terms | '15 years | ' | ' |
Maximum [Member] | ' | ' | ' |
Leases [Line Items] | ' | ' | ' |
Unitary triple-net lease agreements successive terms | '20 years | ' | ' |
USTs [Member] | ' | ' | ' |
Leases [Line Items] | ' | ' | ' |
Amount of asset retirement obligations removed from the balance sheet | 13,074,000 | ' | ' |
Net asset costs related to USTs removed from the balance Sheet | 10,633,000 | ' | ' |
Deferred rental revenue | $2,441,000 | ' | ' |
Leases_Chestnut_Petroleum_Dist
Leases - Chestnut Petroleum Dist. Inc. - Additional Information (Detail) (USD $) | 1 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Operator | Property | |||
Leases [Line Items] | ' | ' | ' | ' |
Number of locations (operators) involved in the proceedings | 24 | ' | ' | ' |
Number of former operators have withdrawn their appeals | 16 | ' | ' | ' |
Number of operators remain in the site during their court appeal | 8 | ' | ' | ' |
Number of properties recapture and sever from NECG | ' | 20 | ' | ' |
Bad debt reserve | ' | $840 | ($21,006) | ' |
Bad debt reserve, total | ' | 3,982 | ' | 3,248 |
Reserved deferred rent receivable | ' | 6,343 | ' | ' |
CPD NY and NECG [Member] | ' | ' | ' | ' |
Leases [Line Items] | ' | ' | ' | ' |
Number of leased properties | ' | 131 | ' | ' |
Number of unitary leases | ' | 2 | ' | ' |
Lease revenue percentage | ' | 20.00% | 21.00% | ' |
CPD NY [Member] | ' | ' | ' | ' |
Leases [Line Items] | ' | ' | ' | ' |
Number of leased properties | ' | 58 | ' | ' |
NECG Holdings Corp [Member] | ' | ' | ' | ' |
Leases [Line Items] | ' | ' | ' | ' |
Number of leased properties | ' | 73 | ' | ' |
Bad debt reserve | ' | 131 | ' | ' |
Bad debt reserve, total | ' | 1,896 | ' | ' |
Non-cash allowances for deferred rental receivable | ' | $1,568 | ' | ' |
Leases_Summary_of_Selected_Fin
Leases - Summary of Selected Financial Data (Detail) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Total revenue | $24,014 | $24,692 | $71,911 | $70,136 | ' |
Net income (loss) | 10,235 | 41,877 | 26,510 | 64,966 | ' |
CPD NY and NECG [Member] | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Total revenue | 144,942 | 143,191 | 419,338 | 410,182 | ' |
Gross profit | 12,130 | 10,054 | 32,313 | 29,841 | ' |
Net income (loss) | 541 | 1,243 | 1,240 | 2,702 | ' |
Current assets | 12,579 | ' | 12,579 | ' | 10,944 |
Noncurrent assets | 30,096 | ' | 30,096 | ' | 28,852 |
Current liabilities | 15,624 | ' | 15,624 | ' | 13,985 |
Noncurrent liabilities | 16,043 | ' | 16,043 | ' | 16,043 |
White Oak Petroleum, LLC, Hudson Petroleum Realty, LLC, Dogwood Petroleum Realty, LLC and Big Apple Petroleum Realty, LLC [Member] | ' | ' | ' | ' | ' |
Condensed Financial Statements, Captions [Line Items] | ' | ' | ' | ' | ' |
Total revenue | 89,830 | 91,135 | 266,933 | 268,880 | ' |
Gross profit | 2,341 | 2,338 | 5,753 | 9,724 | ' |
Net income (loss) | -870 | -783 | -3,918 | -1,363 | ' |
Current assets | 6,254 | ' | 6,254 | ' | 10,128 |
Noncurrent assets | 108,808 | ' | 108,808 | ' | 111,540 |
Current liabilities | 8,578 | ' | 8,578 | ' | 10,880 |
Noncurrent liabilities | $135,383 | ' | $135,383 | ' | $135,210 |
Leases_Capitol_Petroleum_Group
Leases - Capitol Petroleum Group - Additional Information (Detail) | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
White Oak Petroleum Realty LLC [Member] | ' | ' |
Leases [Line Items] | ' | ' |
Number of leased properties | 37 | ' |
Subsidiaries of Capitol Petroleum Group, LLC [Member] | ' | ' |
Leases [Line Items] | ' | ' |
Number of unitary leases | 4 | ' |
Subsidiaries of Capitol Petroleum Group, LLC [Member] | Gasoline Station and Convenience Store Properties [Member] | ' | ' |
Leases [Line Items] | ' | ' |
Number of leased properties included in unitary leases | 97 | ' |
Hudson Petroleum [Member] | ' | ' |
Leases [Line Items] | ' | ' |
Number of leased properties | 24 | ' |
Big Apple Petroleum [Member] | ' | ' |
Leases [Line Items] | ' | ' |
Number of leased properties | 16 | ' |
Dogwood Petroleum [Member] | ' | ' |
Leases [Line Items] | ' | ' |
Number of leased properties | 20 | ' |
Capitol Petroleum Group, LLC [Member] | ' | ' |
Leases [Line Items] | ' | ' |
Lease revenue percentage | 17.00% | 13.00% |
Commitments_and_Contingencies_
Commitments and Contingencies - Additional Information (Detail) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 9 Months Ended | 1 Months Ended | 9 Months Ended | 0 Months Ended | ||||
Sep. 30, 2003 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | 31-May-07 | Sep. 30, 2014 | Jun. 19, 2014 | |
Parties | New Jersey MTBE Claim Against the Company, Marketing and Lukoil [Member] | New Jersey MTBE Claim Against the Company [Member] | NJ MTBE [Member] | NJ MTBE [Member] | Pennsylvania MTBE [Member] | ||||||
Defendant | Defendant | Minimum [Member] | |||||||||
Defendant | |||||||||||
Loss Contingencies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued legal matters | ' | $11,040,000 | ' | $11,040,000 | ' | $11,423,000 | ' | ' | ' | ' | ' |
Provisions for litigation losses | ' | 95,000 | 5,065,000 | 130,000 | 5,471,000 | ' | ' | ' | ' | ' | ' |
Number of potentially responsible parties for Lower Passaic River damages | 66 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Parties to perform a remedial investigation and feasibility study | ' | ' | ' | ' | ' | ' | ' | ' | 70 | ' | ' |
Number of defendants in the MTBE complaint | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50 | 50 |
Settlement amounts sought by the plaintiffs | ' | ' | ' | ' | ' | ' | $88,000,000 | $24,000,000 | ' | ' | ' |
Credit_Agreement_and_Prudentia1
Credit Agreement and Prudential Loan Agreement - Additional Information (Detail) (USD $) | 9 Months Ended | 9 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Feb. 25, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | |
Revolving Credit Facility [Member] | Minimum [Member] | Maximum [Member] | Prudential Loan Agreement [Member] | Prudential Loan Agreement [Member] | LIBOR [Member] | LIBOR [Member] | |||
Minimum [Member] | Maximum [Member] | ||||||||
Credit and Loan Agreement [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Credit agreement initiation date | 25-Feb-13 | ' | ' | ' | ' | ' | ' | ' | ' |
Senior secured revolving credit agreement | $175,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Senior secured revolving credit agreement, maturity date | 31-Aug-15 | ' | ' | ' | ' | ' | ' | ' | ' |
Extension of credit agreement | '1 year | ' | ' | ' | ' | ' | ' | ' | ' |
Total bank syndicate commitment allocated to term loan | 25,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Total Bank Syndicate commitment allocated to a revolving facility | 150,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Option to increase credit facility | ' | ' | 50,000,000 | ' | ' | ' | ' | ' | ' |
Credit facility amount | ' | ' | 200,000,000 | ' | ' | ' | ' | ' | ' |
Credit agreement margin on borrowing base rate | ' | ' | ' | 1.50% | 2.00% | ' | ' | 2.50% | 3.00% |
Annual commitment fee on undrawn funds | ' | ' | ' | 0.30% | 0.40% | ' | ' | ' | ' |
Credit facility outstanding amount | 27,000,000 | 58,000,000 | ' | ' | 27,000,000 | ' | ' | ' | ' |
Interest rate | ' | ' | ' | ' | 2.70% | ' | ' | ' | ' |
Amount of rate increase in case of default | 2.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Mortgaged properties, aggregate net book value | 153,795,000 | 154,117,000 | ' | ' | ' | ' | ' | ' | ' |
Senior secured term loan, issuance date | ' | ' | ' | ' | ' | 25-Feb-13 | ' | ' | ' |
Senior secured term loan, amount | ' | ' | ' | ' | ' | ' | 100,000,000 | ' | ' |
Senior secured term loan agreement, maturity date | ' | ' | ' | ' | ' | 28-Feb-21 | ' | ' | ' |
Interest rate on loan agreement | ' | ' | ' | ' | ' | 6.00% | ' | ' | ' |
Amount of rate increase in case of default | ' | ' | ' | ' | ' | 2.00% | ' | ' | ' |
Fair value of borrowings outstanding | ' | ' | ' | ' | ' | $105,000,000 | ' | ' | ' |
Environmental_Obligations_Addi
Environmental Obligations - Additional Information (Detail) (USD $) | 1 Months Ended | 9 Months Ended | ||
Jul. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | |
Other Commitments [Line Items] | ' | ' | ' | ' |
Payment for pollution legal liability insurance policy | $3,062,000 | ' | ' | ' |
Pollution legal liability insurance policy duration | ' | '10 years | ' | ' |
Pollution legal liability insurance policy aggregate limit | ' | 50,000,000 | ' | ' |
Remediation agreement of lease | ' | 'We have agreed to be responsible for environmental contamination at the premises that was known at the time the lease commenced and for contamination that existed at the premises prior to commencement of the lease and is discovered (other than as a result of a voluntary site investigation) during the first ten years of the lease term. | ' | ' |
Asset retirement obligations removed from balance sheet | ' | 13,074,000 | ' | ' |
Deferred rental revenue | ' | 2,441,000 | ' | ' |
Environmental remediation obligations | ' | 42,320,000 | ' | 43,472,000 |
Accretion expense | ' | 2,032,000 | 2,119,000 | ' |
The amounts of credits to environmental expenses included in continuing operations and to earnings from operating activities in discontinued operations | ' | 423,000 | 1,031,000 | ' |
Increase in carrying value of property | ' | 7,801,000 | 8,657,000 | ' |
Estimated remaining useful life of underground storage tank for capitalized asset retirement costs | ' | '10 years | ' | ' |
Depreciation and amortization expense for capitalized asset retirement costs | ' | 1,078,000 | 1,648,000 | ' |
Capitalized asset retirement costs | ' | 17,366,000 | ' | 18,281,000 |
USTs [Member] | ' | ' | ' | ' |
Other Commitments [Line Items] | ' | ' | ' | ' |
Asset retirement obligations removed from balance sheet | ' | 13,074,000 | ' | ' |
Net asset cost related to USTs removed from the balance sheet | ' | 10,633,000 | ' | ' |
Deferred rental revenue | ' | $2,441,000 | ' | ' |
Shareholders_Equity_Summary_of
Shareholders' Equity - Summary of Changes in Shareholders' Equity (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Shareholders Equity [Line Items] | ' | ' | ' | ' |
Beginning balance, value | ' | ' | $415,091 | ' |
Net earnings | 10,235 | 41,877 | 26,510 | 64,966 |
Dividends | ' | ' | -20,252 | ' |
Stock-based employee compensation expense, value | ' | ' | 661 | ' |
Ending balance, value | 422,010 | ' | 422,010 | ' |
Common Stock [Member] | ' | ' | ' | ' |
Shareholders Equity [Line Items] | ' | ' | ' | ' |
Beginning balance, value | ' | ' | 334 | ' |
Beginning balance, shares | ' | ' | 33,397,260 | ' |
Stock-based employee compensation expense, shares | ' | ' | 19,613 | ' |
Ending balance, value | 334 | ' | 334 | ' |
Ending balance, shares | 33,416,873 | ' | 33,416,873 | ' |
Paid-in-Capital [Member] | ' | ' | ' | ' |
Shareholders Equity [Line Items] | ' | ' | ' | ' |
Beginning balance, value | ' | ' | 462,397 | ' |
Stock-based employee compensation expense, value | ' | ' | 661 | ' |
Ending balance, value | 463,058 | ' | 463,058 | ' |
Dividend Paid in Excess of Earnings [Member] | ' | ' | ' | ' |
Shareholders Equity [Line Items] | ' | ' | ' | ' |
Beginning balance, value | ' | ' | -47,640 | ' |
Net earnings | ' | ' | 26,510 | ' |
Dividends | ' | ' | -20,252 | ' |
Ending balance, value | ($41,382) | ' | ($41,382) | ' |
Shareholders_Equity_Additional
Shareholders' Equity - Additional Information (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | 13-May-14 | Mar. 03, 2014 |
Restricted Stock Units [Member] | Restricted Stock Units [Member] | |||
2004 Omnibus Incentive Compensation Plan [Member] | 2004 Omnibus Incentive Compensation Plan [Member] | |||
Shareholders Equity [Line Items] | ' | ' | ' | ' |
Restricted stock units, granted | ' | ' | 5,000 | 67,125 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 | ' | ' |
Preferred stock, par value | $0.01 | $0.01 | ' | ' |
Preferred stock, shares issued | 0 | 0 | ' | ' |
Property_Acquisitions_Addition
Property Acquisitions - Additional Information (Detail) (USD $) | 1 Months Ended | 9 Months Ended | |
31-May-13 | Sep. 30, 2014 | 9-May-13 | |
Lease | Property | Transactions | |
Transactions | |||
Business Acquisition [Line Items] | ' | ' | ' |
Number of gasoline stations and convenience stores acquired during the period | ' | 7 | ' |
Aggregate purchase price of the gasoline stations and convenience stores acquired during the period | ' | $6,800,000 | ' |
Sale/leaseback transaction investment | ' | ' | 72,500,000 |
Sale/leaseback, initial term | '15 years | ' | ' |
Number of sale/leaseback transactions | ' | ' | 2 |
Number of Triple-Net Unitary Leases | 2 | ' | ' |
Number of Lease Renewal Options | 3 | ' | ' |
Amount of Credit Line Borrowings Used to Finance Acquisition | 57,500,000 | ' | ' |
Mobil-branded Gasoline Station [Member] | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' |
Acquisition of real estate assets | 16 | ' | ' |
Exxon and Shell Gasoline Station [Member] | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' |
Acquisition of real estate assets | 20 | ' | ' |
Internal Revenue Code Section 1031 [Member] | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' |
Amount of 1031 Exchange Proceeds Used To Finance Acquisition | 11,500,000 | ' | ' |
Land Building And Equipment [Member] | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' |
Purchase price allocation, assets acquired | ' | 62,365,000 | ' |
Purchase price allocated to in-place lease and other intangible assets | ' | 3,868,000 | ' |
Transaction cost related to acquisition | ' | 480,000 | ' |
Purchase price allocated to direct financing and capital lease assets | ' | 6,267,000 | ' |
Land Building And Equipment [Member] | Seven Gasoline Stations and Convenience Store Properties [Member] | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' |
Purchase price allocation, assets acquired | ' | 6,455,000 | ' |
Purchase price allocated to in-place lease and other intangible assets | ' | 345,000 | ' |
Transaction cost related to acquisition | ' | $53,000 | ' |
Property_Acquisitions_Pro_Form
Property Acquisitions - Pro Forma Condensed Financial Information (Detail) (USD $) | 9 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 |
Business Combinations [Abstract] | ' |
Revenues | $78,011 |
Net earnings | $66,257 |
Basic and diluted net earnings per common share | $1.98 |