Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2020 | Oct. 21, 2020 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2020 | |
Document Transition Report | false | |
Entity Registrant Name | Brandywine Realty Trust | |
Entity Incorporation, State or Country Code | MD | |
Entity File Number | 001-9106 | |
Entity Tax Identification Number | 23-2413352 | |
Entity Address, Address Line One | 2929 Walnut Street | |
Entity Address, Address Line Two | Suite 1700 | |
Entity Address, City or Town | Philadelphia | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 19104 | |
City Area Code | 610 | |
Local Phone Number | 325-5600 | |
Title of 12(b) Security | Common Shares of Beneficial Interest | |
Trading Symbol | BDN | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 170,572,964 | |
Entity Central Index Key | 0000790816 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
BRANDYWINE OPERATING PARTNERSHIP, L.P. | ||
Document Information [Line Items] | ||
Entity Registrant Name | Brandywine Operating Partnership, L.P. | |
Entity Incorporation, State or Country Code | DE | |
Entity File Number | 000-24407 | |
Entity Tax Identification Number | 23-2862640 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001060386 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Real estate investments: | ||
Operating properties | $ 3,715,765 | $ 4,006,459 |
Accumulated depreciation | (980,664) | (973,318) |
Right of use asset - operating leases, net | 21,145 | 21,656 |
Operating real estate investments, net | 2,756,246 | 3,054,797 |
Construction-in-progress | 186,853 | 180,718 |
Land held for development | 115,474 | 96,124 |
Prepaid leasehold interests in land held for development, net | 39,287 | 39,592 |
Total real estate investments, net | 3,097,860 | 3,371,231 |
Assets held for sale, net | 7,349 | 7,349 |
Cash and cash equivalents | 62,256 | 90,499 |
Accounts receivable, net of allowance of $0 and $284 as of September 30, 2020 and December 31, 2019, respectively | 20,433 | 16,363 |
Accrued rent receivable, net of allowance of $6,111 and $7,691 as of September 30, 2020 and December 31, 2019, respectively | 159,952 | 174,144 |
Investment in Real Estate Ventures | 377,486 | 120,294 |
Deferred costs, net | 90,601 | 95,560 |
Intangible assets, net | 50,715 | 84,851 |
Other assets | 124,408 | 115,678 |
Total assets | 3,991,060 | 4,075,969 |
LIABILITIES AND EQUITY | ||
Mortgage notes payable, net | 88,913 | 313,812 |
Unsecured term loan, net | 248,953 | 248,561 |
Unsecured senior notes, net | 1,581,645 | 1,582,045 |
Accounts payable and accrued expenses | 117,248 | 113,347 |
Distributions payable | 32,705 | 33,815 |
Deferred income, gains and rent | 25,070 | 35,284 |
Intangible liabilities, net | 17,500 | 22,263 |
Lease liability - operating leases | 22,707 | 22,554 |
Other liabilities | 40,537 | 15,985 |
Total liabilities | 2,175,278 | 2,387,666 |
Commitments and contingencies (See Note 14) | ||
Equity: | ||
Common Shares of Brandywine Realty Trust's beneficial interest, $0.01 par value; shares authorized 400,000,000; 170,572,964 and 176,480,095 issued and outstanding as of September 30, 2020 and December 31, 2019, respectively | 1,707 | 1,766 |
Additional paid-in-capital | 3,136,851 | 3,192,158 |
Deferred compensation payable in common shares | 17,516 | 16,216 |
Common shares in grantor trust, 1,160,494 and 1,105,542 issued and outstanding as of September 30, 2020 and December 31, 2019, respectively | (17,516) | (16,216) |
Cumulative earnings | 1,091,095 | 804,556 |
Accumulated other comprehensive loss | (8,749) | (2,370) |
Cumulative distributions | (2,415,736) | (2,318,233) |
Total Brandywine Realty Trust's equity | 1,805,168 | 1,677,877 |
Noncontrolling interests | 10,614 | 10,426 |
Total beneficiaries' equity | 1,815,782 | 1,688,303 |
Total liabilities and beneficiaries' equity | 3,991,060 | 4,075,969 |
BRANDYWINE OPERATING PARTNERSHIP, L.P. | ||
Real estate investments: | ||
Operating properties | 3,715,765 | 4,006,459 |
Accumulated depreciation | (980,664) | (973,318) |
Right of use asset - operating leases, net | 21,145 | 21,656 |
Operating real estate investments, net | 2,756,246 | 3,054,797 |
Construction-in-progress | 186,853 | 180,718 |
Land held for development | 115,474 | 96,124 |
Prepaid leasehold interests in land held for development, net | 39,287 | 39,592 |
Total real estate investments, net | 3,097,860 | 3,371,231 |
Assets held for sale, net | 7,349 | 7,349 |
Cash and cash equivalents | 62,256 | 90,499 |
Accounts receivable, net of allowance of $0 and $284 as of September 30, 2020 and December 31, 2019, respectively | 20,433 | 16,363 |
Accrued rent receivable, net of allowance of $6,111 and $7,691 as of September 30, 2020 and December 31, 2019, respectively | 159,952 | 174,144 |
Investment in Real Estate Ventures | 377,486 | 120,294 |
Deferred costs, net | 90,601 | 95,560 |
Intangible assets, net | 50,715 | 84,851 |
Other assets | 124,408 | 115,678 |
Total assets | 3,991,060 | 4,075,969 |
LIABILITIES AND EQUITY | ||
Mortgage notes payable, net | 88,913 | 313,812 |
Unsecured term loan, net | 248,953 | 248,561 |
Unsecured senior notes, net | 1,581,645 | 1,582,045 |
Accounts payable and accrued expenses | 117,248 | 113,347 |
Distributions payable | 32,705 | 33,815 |
Deferred income, gains and rent | 25,070 | 35,284 |
Intangible liabilities, net | 17,500 | 22,263 |
Lease liability - operating leases | 22,707 | 22,554 |
Other liabilities | 40,537 | 15,985 |
Total liabilities | 2,175,278 | 2,387,666 |
Commitments and contingencies (See Note 14) | ||
Redeemable limited partnership units at redemption value; 981,634 issued and outstanding as of September 30, 2020 and December 31, 2019, respectively | 9,950 | 15,388 |
Equity: | ||
General Partnership Capital; 170,572,964 and 176,480,095 units issued and outstanding as of September 30, 2020 and December 31, 2019, respectively | 1,814,890 | 1,674,539 |
Accumulated other comprehensive loss | (9,130) | (2,715) |
Total Brandywine Operating Partnership, L.P.'s equity | 1,805,760 | 1,671,824 |
Noncontrolling interest - consolidated real estate ventures | 72 | 1,091 |
Total partners' equity | 1,805,832 | 1,672,915 |
Total liabilities and beneficiaries' equity | $ 3,991,060 | $ 4,075,969 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Accounts receivable, allowance | $ 0 | $ 284 |
Accrued rent receivable, allowance | $ 6,111 | $ 7,691 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 400,000,000 | 400,000,000 |
Common stock, shares issued (in shares) | 170,572,964 | 176,480,095 |
Common stock, shares outstanding (in shares) | 170,572,964 | 176,480,095 |
Common shares in grantor trust, issued and outstanding (in shares) | 1,160,494 | 1,105,542 |
BRANDYWINE OPERATING PARTNERSHIP, L.P. | ||
Accounts receivable, allowance | $ 0 | $ 284 |
Accrued rent receivable, allowance | $ 6,111 | $ 7,691 |
Redeemable limited partnership units issued (in units) | 981,634 | 981,634 |
Redeemable limited partnership units outstanding (in units) | 981,634 | 981,634 |
General partners' capital account, units issued (in units) | 170,572,964 | 176,480,095 |
General partners' capital account, units outstanding (in units) | 170,572,964 | 176,480,095 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenue | ||||
Revenue | $ 126,106 | $ 145,331 | $ 408,031 | $ 433,378 |
Operating expenses | ||||
Property operating expenses | 31,567 | 38,358 | 102,320 | 116,542 |
Real estate taxes | 14,923 | 15,247 | 48,525 | 47,119 |
Third party management expenses | 2,509 | 2,469 | 7,546 | 7,035 |
Depreciation and amortization | 43,533 | 55,627 | 145,314 | 158,738 |
General and administrative expenses | 7,069 | 6,974 | 23,973 | 25,217 |
Total operating expenses | 99,601 | 118,675 | 327,678 | 354,651 |
Gain on sale of real estate | ||||
Net gain on disposition of real estate | 271,901 | 356 | 274,487 | 356 |
Net gain on sale of undepreciated real estate | 0 | 250 | 201 | 1,501 |
Total gain on sale of real estate | 271,901 | 606 | 274,688 | 1,857 |
Operating income | 298,406 | 27,262 | 355,041 | 80,584 |
Other income (expense): | ||||
Interest income | 467 | 558 | 1,487 | 1,636 |
Interest expense | (16,310) | (20,400) | (56,510) | (61,273) |
Interest expense - amortization of deferred financing costs | (715) | (694) | (2,195) | (2,026) |
Equity in loss of Real Estate Ventures | (5,788) | (1,965) | (9,882) | (4,814) |
Net gain on real estate venture transactions | 75 | 2,059 | 75 | 3,594 |
Net income before income taxes | 276,135 | 6,820 | 288,016 | 17,701 |
Income tax (provision) benefit | (2) | 0 | 224 | (46) |
Net income | 276,133 | 6,820 | 288,240 | 17,655 |
Net income attributable to noncontrolling interests | (1,612) | (48) | (1,701) | (155) |
Net income attributable to Brandywine Realty Trust | 274,521 | 6,772 | 286,539 | 17,500 |
Nonforfeitable dividends allocated to unvested restricted shareholders | (93) | (93) | (317) | (305) |
Net income attributable to Common Shareholders of Brandywine Realty Trust | $ 274,428 | $ 6,679 | $ 286,222 | $ 17,195 |
Basic income per Common Share (in dollars per share) | $ 1.61 | $ 0.04 | $ 1.66 | $ 0.10 |
Diluted income per Common Share (in dollars per share) | $ 1.60 | $ 0.04 | $ 1.66 | $ 0.10 |
Basic weighted average shares outstanding (in shares) | 170,573,028 | 176,195,244 | 172,380,410 | 176,066,507 |
Diluted weighted average shares outstanding (in shares) | 171,026,492 | 176,750,600 | 172,735,436 | 176,617,726 |
BRANDYWINE OPERATING PARTNERSHIP, L.P. | ||||
Revenue | ||||
Revenue | $ 126,106 | $ 145,331 | $ 408,031 | $ 433,378 |
Operating expenses | ||||
Property operating expenses | 31,567 | 38,358 | 102,320 | 116,542 |
Real estate taxes | 14,923 | 15,247 | 48,525 | 47,119 |
Third party management expenses | 2,509 | 2,469 | 7,546 | 7,035 |
Depreciation and amortization | 43,533 | 55,627 | 145,314 | 158,738 |
General and administrative expenses | 7,069 | 6,974 | 23,973 | 25,217 |
Total operating expenses | 99,601 | 118,675 | 327,678 | 354,651 |
Gain on sale of real estate | ||||
Net gain on disposition of real estate | 271,901 | 356 | 274,487 | 356 |
Net gain on sale of undepreciated real estate | 0 | 250 | 201 | 1,501 |
Total gain on sale of real estate | 271,901 | 606 | 274,688 | 1,857 |
Operating income | 298,406 | 27,262 | 355,041 | 80,584 |
Other income (expense): | ||||
Interest income | 467 | 558 | 1,487 | 1,636 |
Interest expense | (16,310) | (20,400) | (56,510) | (61,273) |
Interest expense - amortization of deferred financing costs | (715) | (694) | (2,195) | (2,026) |
Equity in loss of Real Estate Ventures | (5,788) | (1,965) | (9,882) | (4,814) |
Net gain on real estate venture transactions | 75 | 2,059 | 75 | 3,594 |
Net income before income taxes | 276,135 | 6,820 | 288,016 | 17,701 |
Income tax (provision) benefit | (2) | 0 | 224 | (46) |
Net income | 276,133 | 6,820 | 288,240 | 17,655 |
Net (income) loss attributable to noncontrolling interests - consolidated real estate ventures | 2 | (11) | (20) | (58) |
Net income attributable to Brandywine Operating Partnership | 276,135 | 6,809 | 288,220 | 17,597 |
Nonforfeitable dividends allocated to unvested restricted shareholders | (93) | (93) | (317) | (305) |
Net income attributable to Common Shareholders of Brandywine Realty Trust | $ 276,042 | $ 6,716 | $ 287,903 | $ 17,292 |
Basic income per Common Share (in dollars per share) | $ 1.61 | $ 0.04 | $ 1.66 | $ 0.10 |
Diluted income per Common Share (in dollars per share) | $ 1.60 | $ 0.04 | $ 1.66 | $ 0.10 |
Basic weighted average shares outstanding (in shares) | 171,554,662 | 177,176,870 | 173,362,044 | 177,048,621 |
Diluted weighted average shares outstanding (in shares) | 172,008,126 | 177,732,226 | 173,717,070 | 177,599,840 |
Rents | ||||
Revenue | ||||
Revenue | $ 121,277 | $ 139,228 | $ 392,661 | $ 415,113 |
Rents | BRANDYWINE OPERATING PARTNERSHIP, L.P. | ||||
Revenue | ||||
Revenue | 121,277 | 139,228 | 392,661 | 415,113 |
Third party management fees, labor reimbursement and leasing | ||||
Revenue | ||||
Service and other revenue | 4,324 | 4,938 | 13,339 | 14,041 |
Third party management fees, labor reimbursement and leasing | BRANDYWINE OPERATING PARTNERSHIP, L.P. | ||||
Revenue | ||||
Service and other revenue | 4,324 | 4,938 | 13,339 | 14,041 |
Other | ||||
Revenue | ||||
Service and other revenue | 505 | 1,165 | 2,031 | 4,224 |
Other | BRANDYWINE OPERATING PARTNERSHIP, L.P. | ||||
Revenue | ||||
Service and other revenue | $ 505 | $ 1,165 | $ 2,031 | $ 4,224 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | ||
Net income | $ 276,133 | $ 6,820 | $ 288,240 | $ 17,655 | |
Comprehensive income (loss): | |||||
Unrealized gain (loss) on derivative financial instruments | 1,040 | (1,586) | (6,979) | (9,209) | |
Amortization of interest rate contracts | [1] | 188 | 188 | 564 | 582 |
Total comprehensive income (loss) | 1,228 | (1,398) | (6,415) | (8,627) | |
Comprehensive income | 277,361 | 5,422 | 281,825 | 9,028 | |
Comprehensive income attributable to noncontrolling interest | (1,619) | (40) | (1,665) | (107) | |
Comprehensive income attributable to Brandywine Realty Trust | 275,742 | 5,382 | 280,160 | 8,921 | |
BRANDYWINE OPERATING PARTNERSHIP, L.P. | |||||
Net income | 276,133 | 6,820 | 288,240 | 17,655 | |
Comprehensive income (loss): | |||||
Unrealized gain (loss) on derivative financial instruments | 1,040 | (1,586) | (6,979) | (9,209) | |
Amortization of interest rate contracts | [1] | 188 | 188 | 564 | 582 |
Total comprehensive income (loss) | 1,228 | (1,398) | (6,415) | (8,627) | |
Comprehensive income | 277,361 | 5,422 | 281,825 | 9,028 | |
Comprehensive income attributable to noncontrolling interest | 2 | (11) | (20) | (58) | |
Comprehensive income attributable to Brandywine Realty Trust | $ 277,363 | $ 5,411 | $ 281,805 | $ 8,970 | |
[1] | Amounts reclassified from comprehensive income to interest expense within the Consolidated Statements of Operations. |
Consolidated Statements of Bene
Consolidated Statements of Beneficiaries' Equity - USD ($) $ in Thousands | Total | Common Stock | Rabbi Trust/Deferred Compensation Shares | Additional Paid-in Capital | Common Shares in Grantor Trust | Cumulative Earnings | Accumulated Other Comprehensive Income (Loss) | Cumulative Distributions | Noncontrolling Interests | Cumulative effect of accounting change | Cumulative effect of accounting changeCumulative Earnings |
Beginning balance (in shares) at Dec. 31, 2018 | 176,873,324 | 977,120 | |||||||||
Beginning balance at Dec. 31, 2018 | $ 1,811,028 | $ 1,770 | $ 14,021 | $ 3,200,312 | $ (14,021) | $ 775,625 | $ 5,029 | $ (2,183,909) | $ 12,201 | $ (5,336) | $ (5,336) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net income | 4,583 | 4,523 | 60 | ||||||||
Other comprehensive income (loss) | (2,483) | (2,469) | (14) | ||||||||
Issuance of partnership interest in consolidated real estate ventures | 22 | 22 | |||||||||
Repurchase and retirement of Common Shares of Beneficial Interest (in shares) | (1,337,169) | ||||||||||
Repurchase and retirement of Common Shares of Beneficial Interest | (17,281) | $ (13) | (17,268) | ||||||||
Share-based compensation activity (in shares) | 465,883 | 41,342 | |||||||||
Share-based compensation activity | 3,677 | $ 4 | 3,673 | ||||||||
Share Issuance from/(to) Deferred Compensation Plan (in shares) | (458) | (5,920) | |||||||||
Share Issuance from/(to) Deferred Compensation Plan | 0 | $ 619 | (619) | ||||||||
Reallocation of Noncontrolling interest | 0 | 57 | (57) | ||||||||
Distributions declared | (33,747) | (33,560) | (187) | ||||||||
Ending balance (in shares) at Mar. 31, 2019 | 176,001,580 | 1,012,542 | |||||||||
Ending balance at Mar. 31, 2019 | 1,760,463 | $ 1,761 | $ 14,640 | 3,186,774 | (14,640) | 774,812 | 2,560 | (2,217,469) | 12,025 | ||
Beginning balance (in shares) at Dec. 31, 2018 | 176,873,324 | 977,120 | |||||||||
Beginning balance at Dec. 31, 2018 | 1,811,028 | $ 1,770 | $ 14,021 | 3,200,312 | (14,021) | 775,625 | 5,029 | (2,183,909) | 12,201 | $ (5,336) | $ (5,336) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net income | 17,655 | ||||||||||
Other comprehensive income (loss) | $ (8,627) | ||||||||||
Repurchase and retirement of Common Shares of Beneficial Interest (in shares) | (1,337,169) | ||||||||||
Repurchase and retirement of Common Shares of Beneficial Interest | $ (17,300) | ||||||||||
Ending balance (in shares) at Sep. 30, 2019 | 176,194,918 | 1,105,542 | |||||||||
Ending balance at Sep. 30, 2019 | 1,702,437 | $ 1,763 | $ 16,216 | 3,189,350 | (16,216) | 787,789 | (3,550) | (2,284,610) | 11,695 | ||
Beginning balance (in shares) at Mar. 31, 2019 | 176,001,580 | 1,012,542 | |||||||||
Beginning balance at Mar. 31, 2019 | 1,760,463 | $ 1,761 | $ 14,640 | 3,186,774 | (14,640) | 774,812 | 2,560 | (2,217,469) | 12,025 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net income | 6,252 | 6,205 | 47 | ||||||||
Other comprehensive income (loss) | (4,746) | (4,720) | (26) | ||||||||
Issuance of partnership interest in consolidated real estate ventures | 3 | 3 | |||||||||
Redemption of LP Units (in shares) | 1,245 | ||||||||||
Redemption of LP Units | 0 | 16 | (16) | ||||||||
Share-based compensation activity (in shares) | 94,150 | ||||||||||
Share-based compensation activity | 1,451 | $ 2 | 1,449 | ||||||||
Share Issuance from/(to) Deferred Compensation Plan (in shares) | 100,908 | 100,908 | |||||||||
Share Issuance from/(to) Deferred Compensation Plan | 0 | $ 1,599 | (1,599) | ||||||||
Distributions declared | (33,758) | (33,571) | (187) | ||||||||
Ending balance (in shares) at Jun. 30, 2019 | 176,197,883 | 1,113,450 | |||||||||
Ending balance at Jun. 30, 2019 | 1,729,665 | $ 1,763 | $ 16,239 | 3,188,239 | (16,239) | 781,017 | (2,160) | (2,251,040) | 11,846 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net income | 6,820 | 6,772 | 48 | ||||||||
Other comprehensive income (loss) | (1,398) | (1,390) | (8) | ||||||||
Issuance of partnership interest in consolidated real estate ventures | 2 | 2 | |||||||||
Share-based compensation activity | 1,105 | 1,105 | |||||||||
Share Issuance from/(to) Deferred Compensation Plan (in shares) | (2,965) | (7,908) | |||||||||
Share Issuance from/(to) Deferred Compensation Plan | 0 | $ (23) | 23 | ||||||||
Reallocation of Noncontrolling interest | 0 | 6 | (6) | ||||||||
Distributions declared | (33,757) | (33,570) | (187) | ||||||||
Ending balance (in shares) at Sep. 30, 2019 | 176,194,918 | 1,105,542 | |||||||||
Ending balance at Sep. 30, 2019 | 1,702,437 | $ 1,763 | $ 16,216 | 3,189,350 | (16,216) | 787,789 | (3,550) | (2,284,610) | 11,695 | ||
Beginning balance (in shares) at Dec. 31, 2019 | 176,480,095 | 1,105,542 | |||||||||
Beginning balance at Dec. 31, 2019 | 1,688,303 | $ 1,766 | $ 16,216 | 3,192,158 | (16,216) | 804,556 | (2,370) | (2,318,233) | 10,426 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net income | 8,087 | 8,022 | 65 | ||||||||
Other comprehensive income (loss) | (7,869) | (7,825) | (44) | ||||||||
Repurchase and retirement of Common Shares of Beneficial Interest (in shares) | (5,644,200) | ||||||||||
Repurchase and retirement of Common Shares of Beneficial Interest | (53,858) | $ (57) | (53,801) | ||||||||
Share-based compensation activity (in shares) | 142,468 | 50,967 | |||||||||
Share-based compensation activity | 2,031 | $ 1 | 2,030 | ||||||||
Share Issuance from/(to) Deferred Compensation Plan (in shares) | (12,376) | (38,726) | |||||||||
Share Issuance from/(to) Deferred Compensation Plan | (193) | $ 796 | (193) | (796) | |||||||
Distributions declared | (32,687) | (32,500) | (187) | ||||||||
Ending balance (in shares) at Mar. 31, 2020 | 170,965,987 | 1,117,783 | |||||||||
Ending balance at Mar. 31, 2020 | 1,603,814 | $ 1,710 | $ 17,012 | 3,140,194 | (17,012) | 812,578 | (10,195) | (2,350,733) | 10,260 | ||
Beginning balance (in shares) at Dec. 31, 2019 | 176,480,095 | 1,105,542 | |||||||||
Beginning balance at Dec. 31, 2019 | 1,688,303 | $ 1,766 | $ 16,216 | 3,192,158 | (16,216) | 804,556 | (2,370) | (2,318,233) | 10,426 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net income | 288,240 | ||||||||||
Other comprehensive income (loss) | $ (6,415) | ||||||||||
Repurchase and retirement of Common Shares of Beneficial Interest (in shares) | (6,248,483) | ||||||||||
Repurchase and retirement of Common Shares of Beneficial Interest | $ (60,000) | ||||||||||
Ending balance (in shares) at Sep. 30, 2020 | 170,572,964 | 1,160,494 | |||||||||
Ending balance at Sep. 30, 2020 | 1,815,782 | $ 1,707 | $ 17,516 | 3,136,851 | (17,516) | 1,091,095 | (8,749) | (2,415,736) | 10,614 | ||
Beginning balance (in shares) at Mar. 31, 2020 | 170,965,987 | 1,117,783 | |||||||||
Beginning balance at Mar. 31, 2020 | 1,603,814 | $ 1,710 | $ 17,012 | 3,140,194 | (17,012) | 812,578 | (10,195) | (2,350,733) | 10,260 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net income | 4,020 | 3,996 | 24 | ||||||||
Other comprehensive income (loss) | 226 | 225 | 1 | ||||||||
Repurchase and retirement of Common Shares of Beneficial Interest (in shares) | (604,283) | ||||||||||
Repurchase and retirement of Common Shares of Beneficial Interest | (6,141) | $ (5) | (6,136) | ||||||||
Share-based compensation activity (in shares) | 166,628 | ||||||||||
Share-based compensation activity | 1,668 | $ 2 | 1,666 | ||||||||
Share Issuance from/(to) Deferred Compensation Plan (in shares) | 44,827 | 42,906 | |||||||||
Share Issuance from/(to) Deferred Compensation Plan | (11) | $ 504 | (11) | (504) | |||||||
Reallocation of Noncontrolling interest | 0 | (123) | 123 | ||||||||
Distributions declared | (32,727) | (32,540) | (187) | ||||||||
Ending balance (in shares) at Jun. 30, 2020 | 170,573,159 | 1,160,689 | |||||||||
Ending balance at Jun. 30, 2020 | 1,570,849 | $ 1,707 | $ 17,516 | 3,135,590 | (17,516) | 816,574 | (9,970) | (2,383,273) | 10,221 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net income | 276,133 | 274,521 | 1,612 | ||||||||
Other comprehensive income (loss) | 1,228 | 1,221 | 7 | ||||||||
Impact of deconsolidation of real estate venture | (1,017) | (1,017) | |||||||||
Distributions from consolidated real estate ventures | (22) | (22) | |||||||||
Share-based compensation activity | 1,263 | 1,263 | |||||||||
Share Issuance from/(to) Deferred Compensation Plan (in shares) | (195) | (195) | |||||||||
Share Issuance from/(to) Deferred Compensation Plan | (2) | (2) | |||||||||
Distributions declared | (32,650) | (32,463) | (187) | ||||||||
Ending balance (in shares) at Sep. 30, 2020 | 170,572,964 | 1,160,494 | |||||||||
Ending balance at Sep. 30, 2020 | $ 1,815,782 | $ 1,707 | $ 17,516 | $ 3,136,851 | $ (17,516) | $ 1,091,095 | $ (8,749) | $ (2,415,736) | $ 10,614 |
Consolidated Statements of Be_2
Consolidated Statements of Beneficiaries' Equity (Parenthetical) - $ / shares | 3 Months Ended | |||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||||||
Distributions declared (in dollars per share) | $ 0.19 | $ 0.19 | $ 0.19 | $ 0.19 | $ 0.19 | $ 0.19 |
Consolidated Statements of Part
Consolidated Statements of Partners' Equity - USD ($) $ in Thousands | Total | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interests | BRANDYWINE OPERATING PARTNERSHIP, L.P. | BRANDYWINE OPERATING PARTNERSHIP, L.P.Accumulated Other Comprehensive Income (Loss) | BRANDYWINE OPERATING PARTNERSHIP, L.P.Noncontrolling Interests | BRANDYWINE OPERATING PARTNERSHIP, L.P.General Partner Capital | BRANDYWINE OPERATING PARTNERSHIP, L.P.Cumulative effect of accounting change | BRANDYWINE OPERATING PARTNERSHIP, L.P.Cumulative effect of accounting changeGeneral Partner Capital |
Beginning balance (in shares) at Dec. 31, 2018 | 176,873,324 | ||||||||
Beginning Balance at Dec. 31, 2018 | $ 1,798,508 | $ 4,725 | $ 2,192 | $ 1,791,591 | $ (5,336) | $ (5,336) | |||
Net income | $ 4,583 | $ 60 | 4,583 | 34 | $ 4,549 | ||||
Other comprehensive income (loss) | (2,483) | $ (2,469) | (14) | (2,483) | (2,483) | ||||
Deferred compensation obligation (in shares) | (458) | ||||||||
Deferred compensation obligation | 0 | 0 | |||||||
Repurchase and retirement of LP units (in shares) | (1,337,169) | ||||||||
Repurchase and retirement of LP units | (17,281) | $ (17,281) | |||||||
Issuance of partnership interest in consolidated real estate ventures | 22 | 22 | 22 | 22 | |||||
Share-based compensation activity (in shares) | 465,883 | ||||||||
Share-based compensation activity | 3,677 | 3,677 | $ 3,677 | ||||||
Adjustment of redeemable partnership units to liquidation value at period end | (3,088) | (3,088) | |||||||
Distributions declared to general partnership unitholders | (33,560) | $ (33,560) | |||||||
Ending balance (in shares) at Mar. 31, 2019 | 176,001,580 | ||||||||
Ending Balance at Mar. 31, 2019 | 1,745,042 | 2,242 | 2,248 | $ 1,740,552 | |||||
Beginning balance (in shares) at Dec. 31, 2018 | 176,873,324 | ||||||||
Beginning Balance at Dec. 31, 2018 | 1,798,508 | 4,725 | 2,192 | $ 1,791,591 | $ (5,336) | $ (5,336) | |||
Net income | 17,655 | 17,655 | |||||||
Other comprehensive income (loss) | (8,627) | (8,627) | |||||||
Ending balance (in shares) at Sep. 30, 2019 | 176,194,918 | ||||||||
Ending Balance at Sep. 30, 2019 | 1,687,709 | (3,902) | 2,277 | $ 1,689,334 | |||||
Beginning balance (in shares) at Mar. 31, 2019 | 176,001,580 | ||||||||
Beginning Balance at Mar. 31, 2019 | 1,745,042 | 2,242 | 2,248 | $ 1,740,552 | |||||
Net income | 6,252 | 47 | 6,252 | 13 | $ 6,239 | ||||
Other comprehensive income (loss) | (4,746) | (4,720) | (26) | (4,746) | (4,746) | ||||
Deferred compensation obligation (in shares) | 100,908 | ||||||||
Deferred compensation obligation | 0 | 0 | |||||||
Repurchase and retirement of LP units (in shares) | 1,245 | ||||||||
Repurchase and retirement of LP units | 0 | ||||||||
Issuance of partnership interest in consolidated real estate ventures | 3 | 3 | 3 | 3 | |||||
Share-based compensation activity (in shares) | 94,150 | ||||||||
Share-based compensation activity | 1,451 | 1,451 | $ 1,451 | ||||||
Adjustment of redeemable partnership units to liquidation value at period end | 1,014 | 1,014 | |||||||
Distributions declared to general partnership unitholders | (33,571) | $ (33,571) | |||||||
Ending balance (in shares) at Jun. 30, 2019 | 176,197,883 | ||||||||
Ending Balance at Jun. 30, 2019 | 1,715,445 | (2,504) | 2,264 | $ 1,715,685 | |||||
Net income | 6,820 | 48 | 6,820 | 11 | $ 6,809 | ||||
Other comprehensive income (loss) | (1,398) | (1,390) | (8) | (1,398) | (1,398) | ||||
Deferred compensation obligation (in shares) | (2,965) | ||||||||
Deferred compensation obligation | 0 | 0 | |||||||
Issuance of partnership interest in consolidated real estate ventures | 2 | 2 | 2 | 2 | |||||
Share-based compensation activity | 1,105 | 1,105 | $ 1,105 | ||||||
Adjustment of redeemable partnership units to liquidation value at period end | (695) | (695) | |||||||
Distributions declared to general partnership unitholders | (33,570) | $ (33,570) | |||||||
Ending balance (in shares) at Sep. 30, 2019 | 176,194,918 | ||||||||
Ending Balance at Sep. 30, 2019 | 1,687,709 | (3,902) | 2,277 | $ 1,689,334 | |||||
Beginning balance (in shares) at Dec. 31, 2019 | 176,480,095 | ||||||||
Beginning Balance at Dec. 31, 2019 | 1,672,915 | (2,715) | 1,091 | $ 1,674,539 | |||||
Net income | 8,087 | 65 | 8,087 | 12 | $ 8,075 | ||||
Other comprehensive income (loss) | (7,869) | (7,825) | (44) | (7,869) | (7,869) | ||||
Deferred compensation obligation (in shares) | (12,376) | ||||||||
Deferred compensation obligation | (193) | (193) | $ (193) | ||||||
Repurchase and retirement of LP units (in shares) | (5,644,200) | ||||||||
Repurchase and retirement of LP units | (53,858) | $ (53,858) | |||||||
Share-based compensation activity (in shares) | 142,468 | ||||||||
Share-based compensation activity | 2,031 | 2,031 | $ 2,031 | ||||||
Adjustment of redeemable partnership units to liquidation value at period end | 5,220 | 5,220 | |||||||
Distributions declared to general partnership unitholders | (32,500) | $ (32,500) | |||||||
Ending balance (in shares) at Mar. 31, 2020 | 170,965,987 | ||||||||
Ending Balance at Mar. 31, 2020 | 1,593,833 | (10,584) | 1,103 | $ 1,603,314 | |||||
Beginning balance (in shares) at Dec. 31, 2019 | 176,480,095 | ||||||||
Beginning Balance at Dec. 31, 2019 | 1,672,915 | (2,715) | 1,091 | $ 1,674,539 | |||||
Net income | 288,240 | 288,240 | |||||||
Other comprehensive income (loss) | (6,415) | (6,415) | |||||||
Ending balance (in shares) at Sep. 30, 2020 | 170,572,964 | ||||||||
Ending Balance at Sep. 30, 2020 | 1,805,832 | (9,130) | 72 | $ 1,814,890 | |||||
Beginning balance (in shares) at Mar. 31, 2020 | 170,965,987 | ||||||||
Beginning Balance at Mar. 31, 2020 | 1,593,833 | (10,584) | 1,103 | $ 1,603,314 | |||||
Net income | 4,020 | 24 | 4,020 | 10 | $ 4,010 | ||||
Other comprehensive income (loss) | 226 | 225 | 1 | 226 | 226 | ||||
Deferred compensation obligation (in shares) | 44,827 | ||||||||
Deferred compensation obligation | (11) | (11) | $ (11) | ||||||
Repurchase and retirement of LP units (in shares) | (604,283) | ||||||||
Repurchase and retirement of LP units | (6,141) | $ (6,141) | |||||||
Share-based compensation activity (in shares) | 166,628 | ||||||||
Share-based compensation activity | 1,668 | 1,668 | $ 1,668 | ||||||
Adjustment of redeemable partnership units to liquidation value at period end | (743) | (743) | |||||||
Distributions declared to general partnership unitholders | (32,540) | $ (32,540) | |||||||
Ending balance (in shares) at Jun. 30, 2020 | 170,573,159 | ||||||||
Ending Balance at Jun. 30, 2020 | 1,560,312 | (10,358) | 1,113 | $ 1,569,557 | |||||
Net income | 276,133 | 1,612 | 276,133 | (2) | $ 276,135 | ||||
Other comprehensive income (loss) | 1,228 | $ 1,221 | 7 | 1,228 | 1,228 | ||||
Deferred compensation obligation (in shares) | (195) | ||||||||
Deferred compensation obligation | (2) | (2) | $ (2) | ||||||
Distributions from consolidated real estate ventures | (22) | (22) | (22) | (22) | |||||
Share-based compensation activity | 1,263 | 1,263 | 1,263 | ||||||
Impact of deconsolidation of real estate venture | $ (1,017) | $ (1,017) | (1,017) | (1,017) | |||||
Adjustment of redeemable partnership units to liquidation value at period end | 400 | 400 | |||||||
Distributions declared to general partnership unitholders | (32,463) | $ (32,463) | |||||||
Ending balance (in shares) at Sep. 30, 2020 | 170,572,964 | ||||||||
Ending Balance at Sep. 30, 2020 | $ 1,805,832 | $ (9,130) | $ 72 | $ 1,814,890 |
Consolidated Statements of Pa_2
Consolidated Statements of Partners' Equity (Parenthetical) - $ / shares | 3 Months Ended | |||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | |
BRANDYWINE OPERATING PARTNERSHIP, L.P. | General Partner Capital | ||||||
Distributions to general partnership unitholders (USD per share) | $ 0.19 | $ 0.19 | $ 0.19 | $ 0.19 | $ 0.19 | $ 0.19 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from operating activities: | ||
Net income | $ 288,240 | $ 17,655 |
Adjustments to reconcile net income to net cash from operating activities: | ||
Depreciation and amortization | 145,314 | 158,738 |
Amortization of deferred financing costs | 2,195 | 2,026 |
Amortization of debt discount/(premium), net | (55) | 527 |
Amortization of stock compensation costs | 5,544 | 6,145 |
Straight-line rent income | (8,903) | (8,287) |
Amortization of acquired above (below) market leases, net | (3,657) | (7,236) |
Ground rent expense | 1,092 | 1,103 |
Provision for doubtful accounts | 1,041 | 611 |
Net gain on real estate venture transactions | 0 | (3,594) |
Net gain on sale of interests in real estate | (274,688) | (1,857) |
Loss from Real Estate Ventures, net of distributions | 9,880 | 5,134 |
Income tax provision (benefit) | (224) | 46 |
Changes in assets and liabilities: | ||
Accounts receivable | (6,263) | 2,086 |
Other assets | (7,527) | (13,089) |
Accounts payable and accrued expenses | 10,782 | 194 |
Deferred income, gains and rent | (8,856) | (3,640) |
Other liabilities | 8,549 | (1,312) |
Net cash provided by operating activities | 162,464 | 155,250 |
Cash flows from investing activities: | ||
Acquisition of properties | (11,432) | 0 |
Proceeds from the sale of properties | 122,055 | 41,546 |
Proceeds from real estate venture sales | 0 | 675 |
Proceeds from repayment of mortgage notes receivable | 0 | 3,341 |
Capital expenditures for tenant improvements | (55,262) | (53,383) |
Capital expenditures for redevelopments | (18,664) | (33,905) |
Capital expenditures for developments | (51,435) | (55,002) |
Advances for the purchase of tenant assets, net of repayments | 1,265 | (178) |
Investment in unconsolidated Real Estate Ventures | (719) | (253) |
Deposits for real estate | 0 | (1,990) |
Capital distributions from Real Estate Ventures | 6,916 | 35,206 |
Leasing costs paid | (16,747) | (13,184) |
Net cash used in investing activities | (24,023) | (77,127) |
Cash flows from financing activities: | ||
Repayments of mortgage notes payable | (6,105) | (5,669) |
Proceeds from credit facility borrowings | 170,500 | 333,000 |
Repayments of credit facility borrowings | (170,500) | (279,000) |
Proceeds from the exercise of stock options | 47 | 800 |
Shares used for employee taxes upon vesting of share awards | (1,346) | (1,554) |
Partner contributions to consolidated real estate venture | 0 | 25 |
Repurchase and retirement of common shares | (60,000) | (17,282) |
Distributions paid to shareholders | (98,651) | (100,573) |
Distributions to noncontrolling interest | (561) | (560) |
Net cash used in financing activities | (166,616) | (70,813) |
Increase/(Decrease) in cash and cash equivalents and restricted cash | (28,175) | 7,310 |
Cash and cash equivalents and restricted cash at beginning of year | 91,170 | 23,211 |
Cash and cash equivalents and restricted cash at end of period | 62,995 | 30,521 |
Reconciliation of cash and cash equivalents and restricted cash: | ||
Cash and cash equivalents, beginning of period | 90,499 | 22,842 |
Restricted cash, beginning of period | 671 | 369 |
Cash and cash equivalents and restricted cash at beginning of year | 91,170 | 23,211 |
Cash and cash equivalents, end of period | 62,256 | 29,925 |
Restricted cash, end of period | 739 | 596 |
Cash and cash equivalents and restricted cash at end of period | 62,995 | 30,521 |
Supplemental disclosure: | ||
Cash paid for interest, net of capitalized interest during the nine months ended September 30, 2020 and 2019 of $3,462 and $2,246, respectively | 51,733 | 56,455 |
Cash paid for income taxes | 719 | 1,169 |
Supplemental disclosure of non-cash activity: | ||
Dividends and distributions declared but not paid | 32,705 | 33,759 |
Change in investment in real estate ventures as a result of dispositions | 0 | 3,461 |
Change in operating real estate from deconsolidation of operating properties | 269,268 | 0 |
Change in investment in real estate ventures from deconsolidation of operating properties | (263,358) | 0 |
Change in mortgage notes payable from deconsolidation of operating properties | (220,271) | 0 |
Change in capital expenditures financed through accounts payable at period end | (8,244) | (6,011) |
Change in capital expenditures financed through retention payable at period end | 754 | (3,356) |
BRANDYWINE OPERATING PARTNERSHIP, L.P. | ||
Cash flows from operating activities: | ||
Net income | 288,240 | 17,655 |
Adjustments to reconcile net income to net cash from operating activities: | ||
Depreciation and amortization | 145,314 | 158,738 |
Amortization of deferred financing costs | 2,195 | 2,026 |
Amortization of debt discount/(premium), net | (55) | 527 |
Amortization of stock compensation costs | 5,544 | 6,145 |
Straight-line rent income | (8,903) | (8,287) |
Amortization of acquired above (below) market leases, net | (3,657) | (7,236) |
Ground rent expense | 1,092 | 1,103 |
Provision for doubtful accounts | 1,041 | 611 |
Net gain on real estate venture transactions | 0 | (3,594) |
Net gain on sale of interests in real estate | (274,688) | (1,857) |
Loss from Real Estate Ventures, net of distributions | 9,880 | 5,134 |
Income tax provision (benefit) | (224) | 46 |
Changes in assets and liabilities: | ||
Accounts receivable | (6,263) | 2,086 |
Other assets | (7,527) | (13,089) |
Accounts payable and accrued expenses | 10,782 | 194 |
Deferred income, gains and rent | (8,856) | (3,640) |
Other liabilities | 8,549 | (1,312) |
Net cash provided by operating activities | 162,464 | 155,250 |
Cash flows from investing activities: | ||
Acquisition of properties | (11,432) | 0 |
Proceeds from the sale of properties | 122,055 | 41,546 |
Proceeds from real estate venture sales | 0 | 675 |
Proceeds from repayment of mortgage notes receivable | 0 | 3,341 |
Capital expenditures for tenant improvements | (55,262) | (53,383) |
Capital expenditures for redevelopments | (18,664) | (33,905) |
Capital expenditures for developments | (51,435) | (55,002) |
Advances for the purchase of tenant assets, net of repayments | 1,265 | (178) |
Investment in unconsolidated Real Estate Ventures | (719) | (253) |
Deposits for real estate | 0 | (1,990) |
Capital distributions from Real Estate Ventures | 6,916 | 35,206 |
Leasing costs paid | (16,747) | (13,184) |
Net cash used in investing activities | (24,023) | (77,127) |
Cash flows from financing activities: | ||
Repayments of mortgage notes payable | (6,105) | (5,669) |
Proceeds from credit facility borrowings | 170,500 | 333,000 |
Repayments of credit facility borrowings | (170,500) | (279,000) |
Proceeds from the exercise of stock options | 47 | 800 |
Shares used for employee taxes upon vesting of share awards | (1,346) | (1,554) |
Partner contributions to consolidated real estate venture | 0 | 25 |
Repurchase and retirement of common shares | (60,000) | (17,282) |
Distributions paid to shareholders | (99,212) | (101,133) |
Net cash used in financing activities | (166,616) | (70,813) |
Increase/(Decrease) in cash and cash equivalents and restricted cash | (28,175) | 7,310 |
Cash and cash equivalents and restricted cash at beginning of year | 91,170 | 23,211 |
Cash and cash equivalents and restricted cash at end of period | 62,995 | 30,521 |
Reconciliation of cash and cash equivalents and restricted cash: | ||
Cash and cash equivalents, beginning of period | 90,499 | 22,842 |
Restricted cash, beginning of period | 671 | 369 |
Cash and cash equivalents and restricted cash at beginning of year | 91,170 | 23,211 |
Cash and cash equivalents, end of period | 62,256 | 29,925 |
Restricted cash, end of period | 739 | 596 |
Cash and cash equivalents and restricted cash at end of period | 62,995 | 30,521 |
Supplemental disclosure: | ||
Cash paid for interest, net of capitalized interest during the nine months ended September 30, 2020 and 2019 of $3,462 and $2,246, respectively | 51,733 | 56,455 |
Cash paid for income taxes | 719 | 1,169 |
Supplemental disclosure of non-cash activity: | ||
Dividends and distributions declared but not paid | 32,705 | 33,759 |
Change in investment in real estate ventures as a result of dispositions | 0 | 3,461 |
Change in operating real estate from deconsolidation of operating properties | 269,268 | 0 |
Change in investment in real estate ventures from deconsolidation of operating properties | (263,358) | 0 |
Change in mortgage notes payable from deconsolidation of operating properties | (220,271) | 0 |
Change in capital expenditures financed through accounts payable at period end | (8,244) | (6,011) |
Change in capital expenditures financed through retention payable at period end | $ 754 | $ (3,356) |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Capitalized interest | $ 3,462 | $ 2,246 |
BRANDYWINE OPERATING PARTNERSHIP, L.P. | ||
Capitalized interest | $ 3,462 | $ 2,246 |
Organization of the Parent Comp
Organization of the Parent Company and The Operating Partnership | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION OF THE PARENT COMPANY AND THE OPERATING PARTNERSHIP | 1. ORGANIZATION OF THE PARENT COMPANY AND THE OPERATING PARTNERSHIP Brandywine Realty Trust (the "Parent Company") is a self-administered and self-managed real estate investment trust (“REIT”) engaged in the acquisition, development, redevelopment, ownership, management, and operation of a portfolio of office and mixed-use properties. The Parent Company owns its assets and conducts its operations through Brandywine Operating Partnership, L.P. (the "Operating Partnership") and subsidiaries of the Operating Partnership. The Parent Company is the sole general partner of the Operating Partnership and, as of September 30, 2020 , owned a 99.4% interest in the Operating Partnership. The Parent Company’s common shares of beneficial interest are publicly traded on the New York Stock Exchange under the ticker symbol “BDN”. The Parent Company, the Operating Partnership, and their consolidated subsidiaries are collectively referred to as the "Company". As of September 30, 2020 , the Company owned 92 properties that contained an aggregate of approximately 14.7 million net rentable square feet (collectively, the “Properties”). The Company’s core portfolio of operating properties (the “Core Properties”) excludes development properties, redevelopment properties, and properties held for sale. The Properties were comprised of the following as of September 30, 2020 : Number of Properties Rentable Square Feet Office properties 84 13,641,289 Mixed-use properties 5 780,184 Core Properties 89 14,421,473 Development property 1 205,803 Redevelopment properties 2 64,070 The Properties 92 14,691,346 In addition to the Properties, as of September 30, 2020 , the Company owned 228.5 acres of land held for development, of which 35.2 acres were held for sale. The Company also held leasehold interests in two land parcels totaling 1.8 acres, each acquired through prepaid 99 -year ground leases, and held options to purchase approximately 55.5 additional acres of undeveloped land. As of September 30, 2020 , the total potential development that this inventory of land could support under current zoning and entitlements, including the parcels under option, amounted to an estimated 14.2 million square feet, of which 0.2 million square feet relates to 35.2 acres held for sale. As of September 30, 2020 , the Company also owned economic interests in eight unconsolidated real estate ventures (collectively, the “Real Estate Ventures”) (see Note 4, ''Investment in Unconsolidated Real Estate Ventures ” for further information). The Properties and the properties owned by the Real Estate Ventures are located in or near Philadelphia, Pennsylvania; Austin, Texas; Metropolitan Washington, D.C.; Southern New Jersey; and Wilmington, Delaware. The Company conducts its third-party real estate management services business primarily through wholly-owned management company subsidiaries. As of September 30, 2020 , the management company subsidiaries were managing properties containing an aggregate of approximately 24.4 million net rentable square feet, of which approximately 14.7 million net rentable square feet related to Properties owned by the Company and approximately 9.7 million net rentable square feet related to properties owned by third parties and Real Estate Ventures. Unless otherwise indicated, all references in this Form 10-Q to square feet represent net rentable area. |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION | 2. BASIS OF PRESENTATION Basis of Presentation The consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim financial statements. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments consist solely of normal recurring matters, and result in a fair statement of the financial position of the Company as of September 30, 2020 , the results of its operations for the three and nine months ended September 30, 2020 and 2019 and its cash flows for the nine months ended September 30, 2020 and 2019 . The results of operations for such interim periods are not necessarily indicative of the results for a full year. These consolidated financial statements should be read in conjunction with the Parent Company’s and the Operating Partnership’s consolidated financial statements and footnotes included in their combined 2019 Annual Report on Form 10-K filed with the SEC on March 2, 2020. The consolidated balance sheet at December 31, 2019 has been derived from the audited financial statements as of that date but does not include all the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. The Company's Annual Report on Form 10-K for the year ended December 31, 2019 contains a discussion of our significant accounting policies under Note 2, "Summary of Significant Accounting Policies" . There have been no significant changes in our significant accounting policies since December 31, 2019 . Risks and Uncertainties - COVID-19 Currently, one of the most significant risks and uncertainties is the potential adverse effect of the ongoing global COVID-19 pandemic, which has significantly slowed global economic activity, caused significant volatility in financial markets, and resulted in unprecedented job losses, causing many to fear an imminent global recession. The responses of many countries, including the U.S., have included mandatory quarantines, restrictions on business activities, including construction activities, restrictions on group gatherings, restrictions on travel and mandatory closures. These actions are creating disruption in the global economy and supply chains and adversely impacting many industries, including owners and developers of real estate. Moreover, there is significant uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. economy and consumer confidence. Demand for space at our properties is dependent on a variety of macroeconomic factors, such as employment levels, interest rates, changes in stock market valuations, rent levels and availability of competing space. The extent to which COVID-19 impacts our results will depend on future developments, many of which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and future action plans. The COVID-19 pandemic has caused continued negative economic impacts, market volatility, and business disruption, which could negatively impact our tenants’ ability to pay rent, our ability to lease vacant space, and our ability to complete development and redevelopment projects. These consequences, in turn, could materially impact our results of operations. Accounting Standards Updates In May 2020, the SEC adopted amendments to requirements for companies relating to significant acquisitions and dispositions of businesses as well as amendments to the significance tests in the ‘significant subsidiary’ definition. Additionally, significant modifications were made to the requirements related to the presentation of pro forma financial information. The amendments are effective on January 1, 2021, with early adoption permitted. The Company has elected to early adopt the amendments as of September 30, 2020. On April 10, 2020, the Financial Accounting Standards Board (the "FASB") issued a Staff Q&A to respond to some frequently asked questions about accounting for lease concessions related to the effects of the COVID-19 pandemic. Consequently, for concessions related to the effects of the COVID-19 pandemic, an entity will not have to analyze each contract to determine whether enforceable rights and obligations for concessions exist in the contract and can elect to apply or not apply the lease modification guidance to those contracts. Entities may make the elections for any lessor-provided concessions related to the effects of the COVID-19 pandemic (e.g., deferrals of lease payments, cash payments made to the lessee, reduced future lease payments) as long as the concession does not result in a substantial increase in the rights of the lessor or the obligations of the lessee. The Company has elected to account for lease concessions as though the enforceable rights and obligations for the concessions existed in the original lease. To date, the impact of lease concessions granted has not had a material effect on the financial statements. The Company will continue to evaluate the impact of lease concessions and the appropriate accounting for those concessions. In March 2020, the FASB issued ASU 2020-04 Reference Rate Reform (Topic 848) Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments provide practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance is optional and is effective between March 12, 2020 and December 31, 2022. The guidance may be elected over time as reference rate reform activities occur. The Company continues to evaluate the impact of the guidance and may apply elections as applicable as additional changes in the market occur. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments Credit Losses (Topic 326), which changes how entities measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The guidance replaces the current incurred loss model with an expected loss approach, resulting in more timely recognition of such losses. In November 2018, the FASB released ASU 2018-19, Codification Improvements to Topic 326, Financial Instrument - Credit Losses, which clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20. The guidance was effective for the Company as of January 1, 2020. The Company adopted ASU 2016-13 effective January 1, 2020 and it did not have a material impact on the consolidated financial statements. |
Real Estate Investments
Real Estate Investments | 9 Months Ended |
Sep. 30, 2020 | |
Real Estate [Abstract] | |
REAL ESTATE INVESTMENTS | 3. REAL ESTATE INVESTMENTS As of September 30, 2020 and December 31, 2019 , the gross carrying value of the operating properties was as follows (in thousands): September 30, 2020 December 31, 2019 Land $ 437,617 $ 489,702 Building and improvements 2,851,185 3,049,395 Tenant improvements 426,963 467,362 Total $ 3,715,765 $ 4,006,459 Acquisitions The following table summarizes the property acquisitions during the nine months ended September 30, 2020 (dollars in thousands): Property/Portfolio Name Acquisition Date Location Property Type Rentable Square Feet/Acres Purchase Price 145 King of Prussia Road February 27, 2020 Radnor, PA Land 7.75 acres $ 11,250 Dispositions The following table summarizes the property dispositions during the nine months ended September 30, 2020 (dollars in thousands): Property/Portfolio Name Disposition Date Location Property Type Rentable Square Feet/Acres Sales Price Gain/(Loss) on Sale (a) 52 East Swedesford Road March 19, 2020 Malvern, PA Office 131,077 $ 18,000 $ 2,336 Keith Valley June 15, 2020 Horsham, PA Land 14.0 Acres $ 4,000 $ 201 One and Two Commerce Square (b) July 21, 2020 Philadelphia, PA Office 1,896,142 $ 115,000 $ 271,905 (a) Gain/(Loss) on Sale is net of closing and other transaction related costs. (b) The Company sold a preferred equity interest representing a 30% equity interest in two office buildings located in Philadelphia, Pennsylvania, to an unrelated third party for $115.0 million (the "Commerce Square Venture Transaction"), which resulted in deconsolidation of the properties and formation of Brandywine Commerce I LP and Brandywine Commerce II LP (collectively, the "Commerce Square Venture"). The transaction valued the properties at $600.0 million . The Company recorded its investment at fair value and recognized a gain of $271.9 million in "Net gain on disposition of real estate" on the Consolidated Statements of Operations during the three months ended September 30, 2020. See Note 4, ''Investment in Unconsolidated Real Estate Ventures ," for further information. Held for Sale As of September 30, 2020 and December 31, 2019, the Company determined that the sale of two parcels of land within the Other segment totaling 35.2 acres was probable and classified these properties as held for sale. As such, $7.3 million |
Investment in Unconsolidated Re
Investment in Unconsolidated Real Estate Ventures | 9 Months Ended |
Sep. 30, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | |
INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES | 4. INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES As of September 30, 2020 , the Company held ownership interests in eight unconsolidated real estate ventures for a net aggregate investment balance of $367.8 million , which includes a negative investment balance in one unconsolidated real estate venture of $9.7 million , reflected within "Other liabilities" on the consolidated balance sheets. As of September 30, 2020 , four of the real estate ventures owned properties that contained an aggregate of approximately 7.3 million net rentable square feet of office space; two real estate ventures owned 1.4 acres of land held for development; one real estate venture owned 1.3 acres of land in active development; and one real estate venture owned a residential tower that contained 321 apartment units. The Company accounts for its interests in the Real Estate Ventures, which range from 15% to 70% , using the equity method. Certain of the Real Estate Ventures are subject to specified priority allocations of distributable cash. The Company earned management fees from its Real Estate Ventures of $1.3 million and $3.2 million for the three and nine months ended September 30, 2020 , respectively, and $1.0 million and $3.2 million for the three and nine months ended September 30, 2019 , respectively. The Company earned leasing commission income from its Real Estate Ventures of $0.2 million and $0.9 million for the three and nine months ended September 30, 2020 , respectively, and $0.3 million and $0.8 million for the three and nine months ended September 30, 2019 , respectively. The Company had outstanding accounts receivable balances from its Real Estate Ventures of $1.4 million and $0.8 million as of September 30, 2020 and December 31, 2019 , respectively. The amounts reflected in the following tables (except for the Company’s share of equity in income) are based on the financial information of the individual Real Estate Ventures. The following is a summary of the financial position of the Real Estate Ventures in which the Company held interests as of September 30, 2020 and December 31, 2019 (in thousands): September 30, 2020 December 31, 2019 Net property $ 1,363,889 $ 834,367 Other assets 442,834 342,002 Other liabilities 323,442 290,071 Debt, net 833,716 585,068 Equity (a) 649,565 301,230 (a) This amount does not include the effect of the basis difference between the Company's historical cost basis and the basis recorded at the real estate venture level, which is typically amortized over the life of the related assets and liabilities. Basis differentials occur from the impairment of investments, purchases of third party interests in existing real estate ventures and upon the transfer of assets that were previously owned by the Company into a real estate venture. In addition, certain acquisition, transaction and other costs may not be reflected in the net assets at the real estate venture level. The following is a summary of results of operations of the Real Estate Ventures in which the Company held interests during the three and nine -month periods ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Revenue $ 43,109 $ 32,726 $ 105,554 $ 101,148 Operating expenses (23,870 ) (17,869 ) (59,838 ) (53,956 ) Interest expense, net (6,175 ) (6,180 ) (16,320 ) (16,421 ) Depreciation and amortization (22,345 ) (13,094 ) (47,493 ) (40,279 ) Gain on early extinguishment of debt — 4,371 — 4,371 Net loss $ (9,281 ) $ (46 ) $ (18,097 ) $ (5,137 ) Ownership interest % Various Various Various Various Company's share of net income (loss) $ (5,812 ) $ (1,945 ) $ (9,892 ) $ (4,765 ) Basis adjustments and other 24 (20 ) 10 (49 ) Equity in loss of Real Estate Ventures $ (5,788 ) $ (1,965 ) $ (9,882 ) $ (4,814 ) Commerce Square Venture On July 21, 2020, the Company sold a 30% preferred equity interest in the entities that own One Commerce Square and Two Commerce Square. After the transaction, the Company owns approximately 32% of the equity interest in Commerce Square Venture through preferred equity interest holdings and approximately 38% of the equity interest in Commerce Square Venture as the sole common equity holder, for a combined approximately 70% equity interest in the venture. The properties held by the newly formed joint ventures remain encumbered by the existing mortgages, which had a $222.1 million principal balance outstanding on the transaction date. Based on the facts and circumstances at the formation of the Commerce Square Venture, the Company determined that the venture is not a variable interest entity. As a result, the Company used the voting interest model under the accounting standard for consolidation in order to determine whether to consolidate the Commerce Square Venture. Based upon each member's substantive participating rights over the activities of the Commerce Square Venture under the operating and related agreements of the Commerce Square Venture, the Company does not have a controlling interest in the properties as the third party investor holds substantive participating rights in the properties. Therefore, the Company deconsolidated the properties and the venture is accounted for under the equity method of accounting. As a result, the Company measured its equity interest at fair value based on the fair value of the Commerce Square Venture properties and the distribution provisions of the real estate venture agreement. Since the Company retains a non-controlling interest in the Commerce Square Venture and there are no other facts and circumstances that preclude sale recognition, the contribution qualifies as the sale of a nonfinancial asset under the relevant guidance. Under the conventional approach of accounting for equity method investments, an investor applies its percentage ownership interest to the venture’s net income or loss to determine the investor’s share of the earnings or losses of the venture. This approach is inappropriate if the venture’s capital structure gives different rights and priorities to its investors. Therefore, the Company follows the hypothetical liquidation at book value (“HLBV”) method in determining its share of the venture’s earnings or losses for the reporting period as this method better reflects the Company’s claim on the venture’s book value at the end of each reporting period. Earnings for this equity method investment are recognized in accordance with the investment agreement and, where applicable, based upon the allocation of the investment’s net assets at book value as if the investment was hypothetically liquidated at the end of each reporting period. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
LEASES | 5. LEASES Lessor Accounting The table below sets forth the allocation of lease revenue between fixed contractual payments and variable lease payments for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, Lease Revenue 2020 2019 2020 2019 Fixed contractual payments $ 95,751 $ 105,073 $ 302,146 $ 314,999 Variable lease payments 22,716 27,475 80,824 83,989 Total $ 118,467 $ 132,548 $ 382,970 $ 398,988 |
Intangible Assets and Liabiliti
Intangible Assets and Liabilities | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS AND LIABILITIES | 6. INTANGIBLE ASSETS AND LIABILITIES As of September 30, 2020 and December 31, 2019 , the Company’s intangible assets/liabilities were comprised of the following (in thousands): September 30, 2020 Total Cost Accumulated Amortization Intangible Assets, net Intangible assets, net: In-place lease value $ 89,504 $ (39,302 ) $ 50,202 Tenant relationship value 2,610 (2,399 ) 211 Above market leases acquired 1,140 (838 ) 302 Total intangible assets, net $ 93,254 $ (42,539 ) $ 50,715 Total Cost Accumulated Amortization Intangible Liabilities, net Intangible liabilities, net: Below market leases acquired $ 29,189 $ (11,689 ) $ 17,500 December 31, 2019 Total Cost Accumulated Amortization Intangible Assets, net Intangible assets, net: In-place lease value $ 167,357 $ (84,123 ) $ 83,234 Tenant relationship value 5,268 (4,815 ) 453 Above market leases acquired 4,956 (3,792 ) 1,164 Total intangible assets, net $ 177,581 $ (92,730 ) $ 84,851 Total Cost Accumulated Amortization Intangible Liabilities, net Intangible liabilities, net: Below market leases acquired $ 44,757 $ (22,494 ) $ 22,263 As of September 30, 2020 , the Company’s annual amortization for its intangible assets/liabilities, assuming no prospective early lease terminations, was as follows (dollars in thousands): Assets Liabilities 2020 (three months remaining) $ 4,273 $ 1,011 2021 14,789 3,601 2022 9,627 2,065 2023 7,564 1,651 2024 5,214 1,425 Thereafter 9,248 7,747 Total $ 50,715 $ 17,500 |
Debt Obligations
Debt Obligations | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
DEBT OBLIGATIONS | 7. DEBT OBLIGATIONS The following table sets forth information regarding the Company’s consolidated debt obligations outstanding as of September 30, 2020 and December 31, 2019 (in thousands): September 30, 2020 December 31, 2019 Effective Interest Rate Maturity Date MORTGAGE DEBT: Two Logan Square (a) $ 79,781 $ 81,103 3.98% October 2020 Four Tower Bridge 9,107 9,291 4.50% February 2021 One Commerce Square (b) — 116,571 3.64% April 2023 Two Commerce Square (b) — 108,472 4.51% April 2023 Principal balance outstanding 88,888 315,437 Plus: fair market value premium (discount), net 25 (1,383 ) Less: deferred financing costs — (242 ) Mortgage indebtedness $ 88,913 $ 313,812 UNSECURED DEBT Seven-Year Term Loan - Swapped to fixed $ 250,000 $ 250,000 2.87% October 2022 $350.0M 3.95% Guaranteed Notes due 2023 350,000 350,000 3.87% February 2023 $350.0M 4.10% Guaranteed Notes due 2024 350,000 350,000 3.78% October 2024 $450.0M 3.95% Guaranteed Notes due 2027 450,000 450,000 4.03% November 2027 $350.0M 4.55% Guaranteed Notes due 2029 350,000 350,000 4.30% October 2029 Indenture IA (Preferred Trust I) 27,062 27,062 LIBOR + 1.25% March 2035 Indenture IB (Preferred Trust I) - Swapped to fixed 25,774 25,774 3.30% April 2035 Indenture II (Preferred Trust II) 25,774 25,774 LIBOR + 1.25% July 2035 Principal balance outstanding 1,828,610 1,828,610 Plus: original issue premium (discount), net 10,626 12,090 Less: deferred financing costs (8,638 ) (10,094 ) Total unsecured indebtedness $ 1,830,598 $ 1,830,606 Total Debt Obligations $ 1,919,511 $ 2,144,418 (a) On October 21, 2020, the Company acquired the mortgage on this property from the lender. See Note 15, "Subsequent Events," for further information. (b) The properties encumbered by these mortgages were deconsolidated as a result of the Commerce Square Venture Transaction.. See Note 3, ''Real Estate Investments ," for further information. In addition to the debt described above, the Company utilizes borrowings under its unsecured revolving credit facility (the “Unsecured Credit Facility”) for general business purposes, including to fund costs of acquisitions, developments and redevelopments of properties, fund share repurchases and repay other debt. The Unsecured Credit Facility provides for borrowings of up to $600.0 million and the per annum variable interest rate on borrowings is LIBOR plus 1.10% . The interest rate and facility fee are subject to adjustment upon a change in the Company’s unsecured debt ratings. During the nine months ended September 30, 2020 , the weighted-average interest rate on Unsecured Credit Facility borrowings was 1.6% resulting in a nominal amount of interest expense. As of September 30, 2020 , the Company had no borrowings under the Unsecured Credit Facility. The Parent Company unconditionally guarantees the unsecured debt obligations of the Operating Partnership (or is a co-borrower with the Operating Partnership) but does not by itself incur unsecured indebtedness. The Parent Company has no material assets other than its investment in the Operating Partnership. The Company was in compliance with all financial covenants as of September 30, 2020 . Certain of the covenants restrict the Company’s ability to obtain alternative sources of capital. As of September 30, 2020 , the Company’s aggregate scheduled principal payments of debt obligations are as follows (in thousands): 2020 (three months remaining) $ 79,845 2021 9,043 2022 250,000 2023 350,000 2024 350,000 Thereafter 878,610 Total principal payments 1,917,498 Net unamortized premiums/(discounts) 10,651 Net deferred financing costs (8,638 ) Outstanding indebtedness $ 1,919,511 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | 8. FAIR VALUE OF FINANCIAL INSTRUMENTS Financial assets and liabilities recorded on the consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows: • Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access; • Level 2 inputs are inputs, other than quoted prices included in Level 1, which are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals; and • Level 3 inputs are unobservable inputs for the asset or liability, which is typically based on an entity’s own assumptions, as there is little, if any, related market activity or information. The Company determined the fair values disclosed below using available market information and discounted cash flow analyses as of September 30, 2020 and December 31, 2019 , respectively. The discount rate used in calculating fair value is the sum of the current risk free rate and the risk premium on the date of measurement of the instruments or obligations. Considerable judgment is necessary to interpret market data and to develop the related estimates of fair value. Accordingly, the estimates presented are not necessarily indicative of the amounts that the Company could realize upon disposition. The use of different estimates and valuation methodologies may have a material effect on the fair value amounts shown. The Company believes that the carrying amounts reflected in the consolidated balance sheets at September 30, 2020 and December 31, 2019 approximate the fair values for cash and cash equivalents, accounts receivable, other assets and liabilities, accounts payable and accrued expenses because they are short-term in duration. The following are financial instruments for which the Company’s estimates of fair value differ from the carrying amounts (in thousands): September 30, 2020 December 31, 2019 Carrying Amount (a) Fair Value Carrying Amount (a) Fair Value Unsecured notes payable $ 1,503,035 $ 1,566,650 $ 1,503,435 $ 1,591,830 Variable rate debt $ 327,563 $ 308,519 $ 327,171 $ 309,947 Mortgage notes payable $ 88,913 $ 89,034 $ 313,812 $ 317,031 Notes receivable $ 44,430 $ 47,415 $ 44,430 $ 43,322 (a) Net of deferred financing costs of $7.6 million and $8.7 million for unsecured notes payable, $1.0 million and $1.4 million for variable rate debt and $0.0 million and $0.2 million for mortgage notes payable as of September 30, 2020 and December 31, 2019 . On June 26, 2018, the Company provided a $44.4 million mortgage loan to Brandywine 1919 Ventures, an unconsolidated real estate venture in which the Company holds a 50% ownership interest, and recorded a related party note receivable of $44.4 million within 'Other assets' on the consolidated balance sheets. Refer to Note 4, ''Investment in Unconsolidated Real Estate Ventures " to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 for further detail regarding this financing. The Company used quoted market prices as of September 30, 2020 and December 31, 2019 to value the unsecured notes payable and, as such, categorized them as Level 2. The inputs utilized to determine the fair value of the Company’s mortgage notes payable and variable rate debt are categorized as Level 3. The fair value of the variable rate debt was determined using a discounted cash flow model that considered borrowing rates available to the Company for loans with similar terms and characteristics. The fair value of the mortgage notes payable was determined using a discounted cash flow model that considered the contractual interest and principal payments discounted at a blended market rate for loans with similar terms, maturities and loan-to-value. These inputs have been categorized as Level 3 because the Company considers the rates used in the valuation techniques to be unobservable. The inputs utilized to determine fair value of the Company's notes receivable are unobservable and, as such, were categorized as Level 3. Fair value was determined using a discounted cash flow model that considered the contractual interest and principal payments discounted at a blended interest rate of the notes receivable. For the Company’s level 3 financial instruments for which fair value is disclosed, an increase in the discount rate used to determine fair value would result in a decrease to the fair value. Conversely, a decrease in the discount rate would result in an increase to the fair value. Disclosure about the fair value of financial instruments is based upon pertinent information available to management as of September 30, 2020 and December 31, 2019 . Although management is not aware of any factors that would significantly affect the fair value amounts, such amounts were not comprehensively revalued for purposes of these financial statements since September 30, 2020 . Current estimates of fair value may differ from the amounts presented herein. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE FINANCIAL INSTRUMENTS | 9. DERIVATIVE FINANCIAL INSTRUMENTS The following table summarizes the terms and fair values of the Company’s derivative financial instruments as of September 30, 2020 and December 31, 2019 . The notional amounts provide an indication of the extent of the Company’s involvement in these instruments at that time, but do not represent exposure to credit, interest rate or market risks (amounts presented in thousands). Hedge Product Hedge Type Designation Notional Amount Strike Trade Date Maturity Date Fair value 9/30/2020 12/31/2019 9/30/2020 12/31/2019 Liabilities Swap Interest Rate Cash Flow (a) $ 250,000 $ 250,000 2.868 % October 8, 2015 October 8, 2022 $ (7,597 ) $ (562 ) Swap Interest Rate Cash Flow (a) 25,774 25,774 3.300 % December 22, 2011 January 30, 2021 (234 ) (94 ) $ 275,774 $ 275,774 (a) Hedging unsecured variable rate debt. The Company measures its derivative instruments at fair value and records them in “Other assets” and (“Other liabilities”) on the Company’s consolidated balance sheets. Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by itself and its counterparties. The Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives. As a result, the Company has determined that the inputs utilized to determine the fair value of derivative instruments are classified in Level 2 of the fair value hierarchy. Disclosure about the fair value of derivative instruments is based upon pertinent information available to management as of September 30, 2020 and December 31, 2019 . Although management is not aware of any factors that would significantly affect the fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since September 30, 2020 . Current estimates of fair value may differ from the amounts presented herein. |
Limited Partners' Non-Controlli
Limited Partners' Non-Controlling Interests in the Parent Company | 9 Months Ended |
Sep. 30, 2020 | |
Noncontrolling Interest [Abstract] | |
LIMITED PARTNERS' NON-CONTROLLING INTERESTS IN THE PARENT COMPANY | 10. LIMITED PARTNERS' NONCONTROLLING INTERESTS IN THE PARENT COMPANY Noncontrolling interests in the Parent Company’s financial statements relate to redeemable common limited partnership interests in the Operating Partnership held by parties other than the Parent Company and properties which are consolidated but not wholly owned by the Operating Partnership. Operating Partnership The aggregate book value of the noncontrolling interests associated with the redeemable common limited partnership interests in the accompanying consolidated balance sheet of the Parent Company was $10.5 million and $9.3 million as of September 30, 2020 and December 31, 2019 , respectively. Under the applicable accounting guidance, the redemption value of limited partnership units are carried at fair value. The Parent Company believes that the aggregate settlement value of these interests (based on the number of units outstanding and the closing price of the common shares on the balance sheet date) was approximately $10.2 million and $15.5 million as of September 30, 2020 and December 31, 2019 , respectively. |
Beneficiaries Equity of the Par
Beneficiaries Equity of the Parent Company | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
BENEFICIARIES' EQUITY OF THE PARENT COMPANY | 11. BENEFICIARIES' EQUITY OF THE PARENT COMPANY Earnings per Share (EPS) The following table details the number of shares and net income used to calculate basic and diluted earnings per share (in thousands, except share and per share amounts; results may not add due to rounding): Three Months Ended September 30, 2020 2019 Basic Diluted Basic Diluted Numerator Net income $ 276,133 $ 276,133 $ 6,820 $ 6,820 Net income attributable to noncontrolling interests (1,612 ) (1,612 ) (48 ) (48 ) Nonforfeitable dividends allocated to unvested restricted shareholders (93 ) (93 ) (93 ) (93 ) Net income attributable to common shareholders $ 274,428 $ 274,428 $ 6,679 $ 6,679 Denominator Weighted-average shares outstanding 170,573,028 170,573,028 176,195,244 176,195,244 Contingent securities/Share based compensation — 453,464 — 555,356 Weighted-average shares outstanding 170,573,028 171,026,492 176,195,244 176,750,600 Earnings per Common Share: Net income attributable to common shareholders $ 1.61 $ 1.60 $ 0.04 $ 0.04 Nine Months Ended September 30, 2020 2019 Basic Diluted Basic Diluted Numerator Net income $ 288,240 $ 288,240 $ 17,655 $ 17,655 Net income attributable to noncontrolling interests (1,701 ) (1,701 ) (155 ) (155 ) Nonforfeitable dividends allocated to unvested restricted shareholders (317 ) (317 ) (305 ) (305 ) Net income attributable to common shareholders $ 286,222 $ 286,222 $ 17,195 $ 17,195 Denominator Weighted-average shares outstanding 172,380,410 172,380,410 176,066,507 176,066,507 Contingent securities/Share based compensation — 355,026 — 551,219 Weighted-average shares outstanding 172,380,410 172,735,436 176,066,507 176,617,726 Earnings per Common Share: Net income attributable to common shareholders $ 1.66 $ 1.66 $ 0.10 $ 0.10 Redeemable common limited partnership units totaling 981,634 at September 30, 2020 and 981,626 at September 30, 2019 , were excluded from the diluted earnings per share computations because they are not dilutive. Unvested restricted shares are considered participating securities which require the use of the two-class method for the computation of basic and diluted earnings per share. For the three and nine months ended September 30, 2020 and 2019 , earnings representing nonforfeitable dividends as noted in the table above were allocated to the unvested restricted shares issued to the Company’s executives and other employees under the Company's shareholder-approved long-term incentive plan. Common Shares On September 15, 2020 the Parent Company declared a distribution of $0.19 per common share, totaling $32.7 million , which was paid on October 21, 2020 to shareholders of record as of October 7, 2020. The Parent Company maintains a common share repurchase program under which the Board of Trustees has authorized the Parent Company to repurchase common shares. On January 3, 2019, the Board of Trustees authorized the repurchase of up to $150.0 million common shares from and after January 3, 2019. During the nine months ended September 30, 2020 , the Company repurchased and retired 6,248,483 common shares at an average price of $9.60 per share, totaling $60.0 million . During the nine months ended September 30, 2019 , the Company repurchased and retired 1,337,169 common shares at an average price of $12.92 per share, totaling $17.3 million . |
Partners' Equity Of The Parent
Partners' Equity Of The Parent Company | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
PARTNERS' EQUITY OF THE PARENT COMPANY | 12. PARTNERS' EQUITY OF THE PARENT COMPANY Earnings per Common Partnership Unit The following table details the number of units and net income used to calculate basic and diluted earnings per common partnership unit (in thousands, except unit and per unit amounts; results may not add due to rounding): Three Months Ended September 30, 2020 2019 Basic Diluted Basic Diluted Numerator Net income $ 276,133 $ 276,133 $ 6,820 $ 6,820 Net (income) loss attributable to noncontrolling interests 2 2 (11 ) (11 ) Nonforfeitable dividends allocated to unvested restricted unitholders (93 ) (93 ) (93 ) (93 ) Net income attributable to common unitholders $ 276,042 $ 276,042 $ 6,716 $ 6,716 Denominator Weighted-average units outstanding 171,554,662 171,554,662 177,176,870 177,176,870 Contingent securities/Share based compensation — 453,464 — 555,356 Total weighted-average units outstanding 171,554,662 172,008,126 177,176,870 177,732,226 Earnings per Common Partnership Unit: Net income attributable to common unitholders 1.61 1.60 0.04 0.04 Nine Months Ended September 30, 2020 2019 Basic Diluted Basic Diluted Numerator Net income $ 288,240 $ 288,240 $ 17,655 $ 17,655 Net income attributable to noncontrolling interests (20 ) (20 ) (58 ) (58 ) Nonforfeitable dividends allocated to unvested restricted unitholders (317 ) (317 ) (305 ) (305 ) Net income attributable to common unitholders $ 287,903 $ 287,903 $ 17,292 $ 17,292 Denominator Weighted-average units outstanding 173,362,044 173,362,044 177,048,621 177,048,621 Contingent securities/Share based compensation — 355,026 — 551,219 Total weighted-average units outstanding 173,362,044 173,717,070 177,048,621 177,599,840 Earnings per Common Partnership Unit: Net income attributable to common unitholders $ 1.66 $ 1.66 $ 0.10 $ 0.10 Unvested restricted units are considered participating securities which require the use of the two-class method for the computation of basic and diluted earnings per share. For the three and nine months ended September 30, 2020 and 2019 , earnings representing nonforfeitable dividends were allocated to the unvested restricted units issued to the Parent Company's executives and other employees under the Parent Company's shareholder-approved long-term incentive plan. Common Partnership Units On September 15, 2020 the Operating Partnership declared a distribution of $0.19 per common partnership unit, totaling $32.7 million , which was paid on October 21, 2020 to unitholders of record as of October 7, 2020. In connection with the Parent Company’s common share repurchase program, one common unit of the Operating Partnership is retired for each common share repurchased. During the nine months ended September 30, 2020 , the Company retired 6,248,483 common partnership units at an average price of $9.60 per unit, totaling $60.0 million , in connection with an equal number of common share repurchases. During the nine months ended September 30, 2019 , the Company retired 1,337,169 common partnership units at an average price of $12.92 per unit, totaling $17.3 million |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | 13. SEGMENT INFORMATION As of September 30, 2020 , the Company owns and manages properties within five segments: (1) Philadelphia Central Business District ("Philadelphia CBD"), (2) Pennsylvania Suburbs, (3) Austin, Texas (4) Metropolitan Washington, D.C. and (5) Other. The Philadelphia CBD segment includes properties located in the City of Philadelphia, Pennsylvania. The Pennsylvania Suburbs segment includes properties in Chester, Delaware, and Montgomery counties in the Philadelphia suburbs. The Austin, Texas segment includes properties in the City of Austin, Texas. The Metropolitan Washington, D.C. segment includes properties in the District of Columbia, Northern Virginia and Southern Maryland. The Other segment includes properties located in Camden County, New Jersey and New Castle County, Delaware. In addition to the five segments, the corporate group is responsible for cash and investment management, development of certain real estate properties during the construction period, and certain other general support functions. Land held for development and construction in progress is transferred to operating properties by region upon completion of the associated construction or project. The following tables provide selected asset information and results of operations of the Company's reportable segments (in thousands): Real estate investments, at cost: September 30, 2020 December 31, 2019 Philadelphia CBD (a) $ 1,414,041 $ 1,726,299 Pennsylvania Suburbs 1,000,214 1,003,890 Austin, Texas 726,295 721,255 Metropolitan Washington, D.C. 488,139 468,035 Other 87,076 86,980 Operating Properties $ 3,715,765 $ 4,006,459 Right of use asset - operating leases, net $ 21,145 $ 21,656 Corporate Construction-in-progress $ 186,853 $ 180,718 Land held for development (b) $ 115,474 $ 96,124 Prepaid leasehold interests in land held for development, net (c) $ 39,287 $ 39,592 (a) Decrease primarily due to the Commerce Square Venture Transaction. See Note 3, ''Real Estate Investments ," for further information. (b) Does not include 35.2 acres of land classified as held for sale as of September 30, 2020 and December 31, 2019 . (c) Includes leasehold interests in prepaid 99 -year ground leases at 3025 and 3001-3003 JFK Boulevard, in Philadelphia, Pennsylvania as of September 30, 2020 and December 31, 2019 . Net operating income: Three Months Ended September 30, 2020 2019 Total revenue Operating expenses (a) Net operating income (loss) Total revenue Operating expenses (a) Net operating income (loss) Philadelphia CBD $ 52,640 $ (18,522 ) $ 34,118 $ 66,105 $ (24,773 ) $ 41,332 Pennsylvania Suburbs 34,649 (11,141 ) 23,508 34,818 (11,667 ) 23,151 Austin, Texas 25,328 (9,944 ) 15,384 26,280 (9,302 ) 16,978 Metropolitan Washington, D.C. 9,675 (5,236 ) 4,439 13,179 (5,999 ) 7,180 Other 3,188 (2,374 ) 814 3,706 (2,691 ) 1,015 Corporate 626 (1,782 ) (1,156 ) 1,243 (1,642 ) (399 ) Operating properties $ 126,106 $ (48,999 ) $ 77,107 $ 145,331 $ (56,074 ) $ 89,257 Nine Months Ended September 30, 2020 2019 Total revenue Operating expenses (a) Net operating income (loss) Total revenue Operating expenses (a) Net operating income (loss) Philadelphia CBD $ 181,203 $ (65,615 ) $ 115,588 $ 196,859 $ (75,311 ) 121,548 Pennsylvania Suburbs 106,569 (34,980 ) 71,589 104,744 (36,466 ) 68,278 Austin, Texas 76,921 (30,032 ) 46,889 77,234 (28,182 ) 49,052 Metropolitan Washington, D.C. 30,520 (15,678 ) 14,842 40,372 (18,542 ) 21,830 Other 10,221 (7,434 ) 2,787 10,352 (7,226 ) 3,126 Corporate 2,597 (4,652 ) (2,055 ) 3,817 (4,969 ) (1,152 ) Operating properties $ 408,031 $ (158,391 ) $ 249,640 $ 433,378 $ (170,696 ) $ 262,682 (a) Includes property operating expenses, real estate taxes and third party management expense. Unconsolidated real estate ventures: Investment in real estate ventures Equity in income (loss) of real estate venture As of Three Months Ended September 30, Nine Months Ended September 30, September 30, 2020 December 31, 2019 2020 2019 2020 2019 Philadelphia CBD (a) $ 277,161 $ 17,524 $ (2,737 ) $ 55 $ (2,575 ) $ 217 Metropolitan Washington, D.C. 100,325 102,840 (1,367 ) (528 ) (2,463 ) (963 ) MAP Venture (b) (9,715 ) (70 ) (1,684 ) (1,602 ) (4,844 ) (4,414 ) Other — — — 110 — 346 Total $ 367,771 $ 120,294 $ (5,788 ) $ (1,965 ) $ (9,882 ) $ (4,814 ) (a) Increase primarily due to the Commerce Square Venture Transaction. See Note 3, ''Real Estate Investments ," for further information. (b) Included in "Other liabilities" on the consolidated balance sheets. Net operating income (“NOI”) is a non-GAAP financial measure, which we define as total revenue less property operating expenses, real estate taxes and third party management expenses. Property operating expenses that are included in determining NOI consist of costs that are necessary and allocable to our operating properties such as utilities, property-level salaries, repairs and maintenance, property insurance and management fees. General and administrative expenses that are not reflected in NOI primarily consist of corporate-level salaries, amortization of share awards and professional fees that are incurred as part of corporate office management. NOI presented by the Company may not be comparable to NOI reported by other companies that define NOI differently. NOI is the measure that is used by the Company’s management to evaluate the operating performance of the Company’s real estate assets by segment. The Company believes NOI provides useful information to investors regarding the financial condition and results of operations because it reflects only those income and expense items that are incurred at the property level. While NOI is a relevant and widely used measure of operating performance of real estate investment trusts, it does not represent cash flow from operations or net income as defined by GAAP and should not be considered as an alternative to those measures in evaluating our liquidity or operating performance. NOI does not reflect interest expenses, real estate impairment losses, depreciation and amortization costs, capital expenditures and leasing costs. The Company believes that net income (loss), as defined by GAAP, is the most appropriate earnings measure. The following is a reconciliation of consolidated net income, as defined by GAAP, to consolidated NOI, (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Net income $ 276,133 $ 6,820 $ 288,240 $ 17,655 Plus: Interest expense 16,310 20,400 56,510 61,273 Interest expense - amortization of deferred financing costs 715 694 2,195 2,026 Depreciation and amortization 43,533 55,627 145,314 158,738 General and administrative expenses 7,069 6,974 23,973 25,217 Equity in loss of Real Estate Ventures 5,788 1,965 9,882 4,814 Less: Interest income 467 558 1,487 1,636 Income tax (provision) benefit (2 ) — 224 (46 ) Net gain on disposition of real estate 271,901 356 274,487 356 Net gain on sale of undepreciated real estate — 250 201 1,501 Net gain on real estate venture transactions 75 2,059 75 3,594 Consolidated net operating income $ 77,107 $ 89,257 $ 249,640 $ 262,682 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 14. COMMITMENTS AND CONTINGENCIES Legal Proceedings The Company is involved from time to time in litigation on various matters, including disputes with tenants, vendors and disputes arising out of agreements to purchase or sell properties. Given the nature of the Company’s business activities, these lawsuits are considered routine to the conduct of its business. The result of any particular lawsuit cannot be predicted, because of the very nature of litigation, the litigation process and its adversarial nature, and the jury system. The Company will establish reserves for specific legal proceedings when it determines that the likelihood of an unfavorable outcome is probable and when the amount of loss is reasonably estimable. The Company does not expect that the liabilities, if any, that may ultimately result from such legal actions will have a material adverse effect on the consolidated financial position, results of operations or cash flows of the Company. Letters-of-Credit Under certain mortgages, the Company has funded required leasing and capital reserve accounts for the benefit of the mortgage lenders with letters-of-credit. There were no letters-of-credit for a mortgage lender as of September 30, 2020 . Certain of the tenant rents at properties that secure these mortgage loans are deposited into the loan servicer’s depository accounts, which are used to fund debt service, operating expenses, capital expenditures and the escrow and reserve accounts, as necessary. Any excess cash is included in cash and cash equivalents. Environmental As an owner of real estate, the Company is subject to various environmental laws of federal, state, and local governments. The Company’s compliance with existing laws has not had a material adverse effect on its financial condition and results of operations, and the Company does not believe it will have a material adverse effect in the future. However, the Company cannot predict the impact of unforeseen environmental contingencies or new or changed laws or regulations on its current Properties or on properties that the Company may acquire. Debt Guarantees As of September 30, 2020 , the Company’s Real Estate Ventures had aggregate indebtedness of $842.2 million . These loans are generally mortgage or construction loans, most of which are nonrecourse to the Company, except for customary recourse carve-outs. As of September 30, 2020 , the $150.0 million construction loan obtained by 4040 Wilson, located in Arlington, Virginia, for which the Company has a payment guarantee up to $41.3 million , is recourse to the Company. In addition, during construction undertaken by the Real Estate Ventures, including 4040 Wilson, the Company has provided, and expects to continue to provide, cost overrun and completion guarantees, with rights of contribution among partners or members in the real estate ventures, as well as customary environmental indemnities and guarantees of customary exceptions to nonrecourse provisions in loan agreements. Other Commitments or Contingencies In connection with the Schuylkill Yards Project, the Company entered into a neighborhood engagement program and, as of September 30, 2020 , had $7.7 million of future fixed contractual obligations. The Company also committed to fund additional contributions under the program. As of September 30, 2020 , the Company estimates that these additional contributions, which are not fixed under the terms of agreement, will be $2.6 million . In connection with the formation of the Commerce Square Venture, the Company has committed to investing an additional $20.0 million of preferred equity in the properties on a pari passu basis with its joint venture partner. As of September 30, 2020 , the Company was under contract to acquire an office property containing approximately 170,000 rentable square feet located in Radnor, Pennsylvania for a purchase price of $20.3 million . The Company has paid $1.0 million towards the purchase price in the form of a non-refundable deposit and the transaction is expected to close during the fourth quarter of 2020. The Company invests in its properties and regularly incurs capital expenditures in the ordinary course of business to maintain the properties. The Company believes that such expenditures enhance its competitiveness. The Company also enters into construction, utility and service contracts in the ordinary course of business which may extend beyond one year. These contracts typically provide for cancellation with insignificant or no cancellation penalties. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | 15. SUBSEQUENT EVENTS On October 21, 2020, the Company acquired the $79.8 million |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim financial statements. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments consist solely of normal recurring matters, and result in a fair statement of the financial position of the Company as of September 30, 2020 , the results of its operations for the three and nine months ended September 30, 2020 and 2019 and its cash flows for the nine months ended September 30, 2020 and 2019 . The results of operations for such interim periods are not necessarily indicative of the results for a full year. These consolidated financial statements should be read in conjunction with the Parent Company’s and the Operating Partnership’s consolidated financial statements and footnotes included in their combined 2019 Annual Report on Form 10-K filed with the SEC on March 2, 2020. The consolidated balance sheet at December 31, 2019 has been derived from the audited financial statements as of that date but does not include all the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. The Company's Annual Report on Form 10-K for the year ended December 31, 2019 contains a discussion of our significant accounting policies under Note 2, "Summary of Significant Accounting Policies" . There have been no significant changes in our significant accounting policies since December 31, 2019 . |
Significant Risks and Uncertainties | Risks and Uncertainties - COVID-19 Currently, one of the most significant risks and uncertainties is the potential adverse effect of the ongoing global COVID-19 pandemic, which has significantly slowed global economic activity, caused significant volatility in financial markets, and resulted in unprecedented job losses, causing many to fear an imminent global recession. The responses of many countries, including the U.S., have included mandatory quarantines, restrictions on business activities, including construction activities, restrictions on group gatherings, restrictions on travel and mandatory closures. These actions are creating disruption in the global economy and supply chains and adversely impacting many industries, including owners and developers of real estate. Moreover, there is significant uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. economy and consumer confidence. Demand for space at our properties is dependent on a variety of macroeconomic factors, such as employment levels, interest rates, changes in stock market valuations, rent levels and availability of competing space. The extent to which COVID-19 impacts our results will depend on future developments, many of which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and future action plans. The COVID-19 pandemic has caused continued negative economic impacts, market volatility, and business disruption, which could negatively impact our tenants’ ability to pay rent, our ability to lease vacant space, and our ability to complete development and redevelopment projects. These consequences, in turn, could materially impact our results of operations. |
Adoption of New Accounting Guidance | Accounting Standards Updates In May 2020, the SEC adopted amendments to requirements for companies relating to significant acquisitions and dispositions of businesses as well as amendments to the significance tests in the ‘significant subsidiary’ definition. Additionally, significant modifications were made to the requirements related to the presentation of pro forma financial information. The amendments are effective on January 1, 2021, with early adoption permitted. The Company has elected to early adopt the amendments as of September 30, 2020. On April 10, 2020, the Financial Accounting Standards Board (the "FASB") issued a Staff Q&A to respond to some frequently asked questions about accounting for lease concessions related to the effects of the COVID-19 pandemic. Consequently, for concessions related to the effects of the COVID-19 pandemic, an entity will not have to analyze each contract to determine whether enforceable rights and obligations for concessions exist in the contract and can elect to apply or not apply the lease modification guidance to those contracts. Entities may make the elections for any lessor-provided concessions related to the effects of the COVID-19 pandemic (e.g., deferrals of lease payments, cash payments made to the lessee, reduced future lease payments) as long as the concession does not result in a substantial increase in the rights of the lessor or the obligations of the lessee. The Company has elected to account for lease concessions as though the enforceable rights and obligations for the concessions existed in the original lease. To date, the impact of lease concessions granted has not had a material effect on the financial statements. The Company will continue to evaluate the impact of lease concessions and the appropriate accounting for those concessions. In March 2020, the FASB issued ASU 2020-04 Reference Rate Reform (Topic 848) Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments provide practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance is optional and is effective between March 12, 2020 and December 31, 2022. The guidance may be elected over time as reference rate reform activities occur. The Company continues to evaluate the impact of the guidance and may apply elections as applicable as additional changes in the market occur. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments Credit Losses (Topic 326), which changes how entities measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The guidance replaces the current incurred loss model with an expected loss approach, resulting in more timely recognition of such losses. In November 2018, the FASB released ASU 2018-19, Codification Improvements to Topic 326, Financial Instrument - Credit Losses, which clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20. The guidance was effective for the Company as of January 1, 2020. The Company adopted ASU 2016-13 effective January 1, 2020 and it did not have a material impact on the consolidated financial statements. |
Organization of the Parent Co_2
Organization of the Parent Company and The Operating Partnership (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Core Portfolio of Operating Properties and Excludes Development, Redevelopment and Held for Sale | The Company’s core portfolio of operating properties (the “Core Properties”) excludes development properties, redevelopment properties, and properties held for sale. The Properties were comprised of the following as of September 30, 2020 : Number of Properties Rentable Square Feet Office properties 84 13,641,289 Mixed-use properties 5 780,184 Core Properties 89 14,421,473 Development property 1 205,803 Redevelopment properties 2 64,070 The Properties 92 14,691,346 |
Real Estate Investments (Tables
Real Estate Investments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Real Estate [Abstract] | |
Gross Carrying Value of Operating Properties | As of September 30, 2020 and December 31, 2019 , the gross carrying value of the operating properties was as follows (in thousands): September 30, 2020 December 31, 2019 Land $ 437,617 $ 489,702 Building and improvements 2,851,185 3,049,395 Tenant improvements 426,963 467,362 Total $ 3,715,765 $ 4,006,459 |
Summary of Properties Acquired | The following table summarizes the property acquisitions during the nine months ended September 30, 2020 (dollars in thousands): Property/Portfolio Name Acquisition Date Location Property Type Rentable Square Feet/Acres Purchase Price 145 King of Prussia Road February 27, 2020 Radnor, PA Land 7.75 acres $ 11,250 |
Summary of Properties Sold | The following table summarizes the property dispositions during the nine months ended September 30, 2020 (dollars in thousands): Property/Portfolio Name Disposition Date Location Property Type Rentable Square Feet/Acres Sales Price Gain/(Loss) on Sale (a) 52 East Swedesford Road March 19, 2020 Malvern, PA Office 131,077 $ 18,000 $ 2,336 Keith Valley June 15, 2020 Horsham, PA Land 14.0 Acres $ 4,000 $ 201 One and Two Commerce Square (b) July 21, 2020 Philadelphia, PA Office 1,896,142 $ 115,000 $ 271,905 (a) Gain/(Loss) on Sale is net of closing and other transaction related costs. (b) The Company sold a preferred equity interest representing a 30% equity interest in two office buildings located in Philadelphia, Pennsylvania, to an unrelated third party for $115.0 million (the "Commerce Square Venture Transaction"), which resulted in deconsolidation of the properties and formation of Brandywine Commerce I LP and Brandywine Commerce II LP (collectively, the "Commerce Square Venture"). The transaction valued the properties at $600.0 million . The Company recorded its investment at fair value and recognized a gain of $271.9 million in "Net gain on disposition of real estate" on the Consolidated Statements of Operations during the three months ended September 30, 2020. See Note 4, ''Investment in Unconsolidated Real Estate Ventures ," for further information. |
Investment in Unconsolidated _2
Investment in Unconsolidated Real Estate Ventures (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Summary of Financial Position of Real Estate Ventures | The following is a summary of the financial position of the Real Estate Ventures in which the Company held interests as of September 30, 2020 and December 31, 2019 (in thousands): September 30, 2020 December 31, 2019 Net property $ 1,363,889 $ 834,367 Other assets 442,834 342,002 Other liabilities 323,442 290,071 Debt, net 833,716 585,068 Equity (a) 649,565 301,230 (a) This amount does not include the effect of the basis difference between the Company's historical cost basis and the basis recorded at the real estate venture level, which is typically amortized over the life of the related assets and liabilities. Basis differentials occur from the impairment of investments, purchases of third party interests in existing real estate ventures and upon the transfer of assets that were previously owned by the Company into a real estate venture. In addition, certain acquisition, transaction and other costs may not be reflected in the net assets at the real estate venture level. |
Investment in Real Estate Ventures and Share of Real Estate Ventures' Income (Loss) | The following is a summary of results of operations of the Real Estate Ventures in which the Company held interests during the three and nine -month periods ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Revenue $ 43,109 $ 32,726 $ 105,554 $ 101,148 Operating expenses (23,870 ) (17,869 ) (59,838 ) (53,956 ) Interest expense, net (6,175 ) (6,180 ) (16,320 ) (16,421 ) Depreciation and amortization (22,345 ) (13,094 ) (47,493 ) (40,279 ) Gain on early extinguishment of debt — 4,371 — 4,371 Net loss $ (9,281 ) $ (46 ) $ (18,097 ) $ (5,137 ) Ownership interest % Various Various Various Various Company's share of net income (loss) $ (5,812 ) $ (1,945 ) $ (9,892 ) $ (4,765 ) Basis adjustments and other 24 (20 ) 10 (49 ) Equity in loss of Real Estate Ventures $ (5,788 ) $ (1,965 ) $ (9,882 ) $ (4,814 ) |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Schedule of Lease Income | The table below sets forth the allocation of lease revenue between fixed contractual payments and variable lease payments for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, Lease Revenue 2020 2019 2020 2019 Fixed contractual payments $ 95,751 $ 105,073 $ 302,146 $ 314,999 Variable lease payments 22,716 27,475 80,824 83,989 Total $ 118,467 $ 132,548 $ 382,970 $ 398,988 |
Intangible Assets and Liabili_2
Intangible Assets and Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets and Liabilities | As of September 30, 2020 and December 31, 2019 , the Company’s intangible assets/liabilities were comprised of the following (in thousands): September 30, 2020 Total Cost Accumulated Amortization Intangible Assets, net Intangible assets, net: In-place lease value $ 89,504 $ (39,302 ) $ 50,202 Tenant relationship value 2,610 (2,399 ) 211 Above market leases acquired 1,140 (838 ) 302 Total intangible assets, net $ 93,254 $ (42,539 ) $ 50,715 Total Cost Accumulated Amortization Intangible Liabilities, net Intangible liabilities, net: Below market leases acquired $ 29,189 $ (11,689 ) $ 17,500 December 31, 2019 Total Cost Accumulated Amortization Intangible Assets, net Intangible assets, net: In-place lease value $ 167,357 $ (84,123 ) $ 83,234 Tenant relationship value 5,268 (4,815 ) 453 Above market leases acquired 4,956 (3,792 ) 1,164 Total intangible assets, net $ 177,581 $ (92,730 ) $ 84,851 Total Cost Accumulated Amortization Intangible Liabilities, net Intangible liabilities, net: Below market leases acquired $ 44,757 $ (22,494 ) $ 22,263 |
Summary of Amortization for Intangible Assets and Liabilities | As of September 30, 2020 , the Company’s annual amortization for its intangible assets/liabilities, assuming no prospective early lease terminations, was as follows (dollars in thousands): Assets Liabilities 2020 (three months remaining) $ 4,273 $ 1,011 2021 14,789 3,601 2022 9,627 2,065 2023 7,564 1,651 2024 5,214 1,425 Thereafter 9,248 7,747 Total $ 50,715 $ 17,500 |
Debt Obligations (Tables)
Debt Obligations (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Consolidated debt obligations | The following table sets forth information regarding the Company’s consolidated debt obligations outstanding as of September 30, 2020 and December 31, 2019 (in thousands): September 30, 2020 December 31, 2019 Effective Interest Rate Maturity Date MORTGAGE DEBT: Two Logan Square (a) $ 79,781 $ 81,103 3.98% October 2020 Four Tower Bridge 9,107 9,291 4.50% February 2021 One Commerce Square (b) — 116,571 3.64% April 2023 Two Commerce Square (b) — 108,472 4.51% April 2023 Principal balance outstanding 88,888 315,437 Plus: fair market value premium (discount), net 25 (1,383 ) Less: deferred financing costs — (242 ) Mortgage indebtedness $ 88,913 $ 313,812 UNSECURED DEBT Seven-Year Term Loan - Swapped to fixed $ 250,000 $ 250,000 2.87% October 2022 $350.0M 3.95% Guaranteed Notes due 2023 350,000 350,000 3.87% February 2023 $350.0M 4.10% Guaranteed Notes due 2024 350,000 350,000 3.78% October 2024 $450.0M 3.95% Guaranteed Notes due 2027 450,000 450,000 4.03% November 2027 $350.0M 4.55% Guaranteed Notes due 2029 350,000 350,000 4.30% October 2029 Indenture IA (Preferred Trust I) 27,062 27,062 LIBOR + 1.25% March 2035 Indenture IB (Preferred Trust I) - Swapped to fixed 25,774 25,774 3.30% April 2035 Indenture II (Preferred Trust II) 25,774 25,774 LIBOR + 1.25% July 2035 Principal balance outstanding 1,828,610 1,828,610 Plus: original issue premium (discount), net 10,626 12,090 Less: deferred financing costs (8,638 ) (10,094 ) Total unsecured indebtedness $ 1,830,598 $ 1,830,606 Total Debt Obligations $ 1,919,511 $ 2,144,418 (a) On October 21, 2020, the Company acquired the mortgage on this property from the lender. See Note 15, "Subsequent Events," for further information. (b) The properties encumbered by these mortgages were deconsolidated as a result of the Commerce Square Venture Transaction.. See Note 3, ''Real Estate Investments ," for further information. |
Schedule of maturities of long-term debt | As of September 30, 2020 , the Company’s aggregate scheduled principal payments of debt obligations are as follows (in thousands): 2020 (three months remaining) $ 79,845 2021 9,043 2022 250,000 2023 350,000 2024 350,000 Thereafter 878,610 Total principal payments 1,917,498 Net unamortized premiums/(discounts) 10,651 Net deferred financing costs (8,638 ) Outstanding indebtedness $ 1,919,511 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Instruments With Fair Values Different From Their Carrying Amount | The following are financial instruments for which the Company’s estimates of fair value differ from the carrying amounts (in thousands): September 30, 2020 December 31, 2019 Carrying Amount (a) Fair Value Carrying Amount (a) Fair Value Unsecured notes payable $ 1,503,035 $ 1,566,650 $ 1,503,435 $ 1,591,830 Variable rate debt $ 327,563 $ 308,519 $ 327,171 $ 309,947 Mortgage notes payable $ 88,913 $ 89,034 $ 313,812 $ 317,031 Notes receivable $ 44,430 $ 47,415 $ 44,430 $ 43,322 (a) Net of deferred financing costs of $7.6 million and $8.7 million for unsecured notes payable, $1.0 million and $1.4 million for variable rate debt and $0.0 million and $0.2 million for mortgage notes payable as of September 30, 2020 and December 31, 2019 . |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The following table summarizes the terms and fair values of the Company’s derivative financial instruments as of September 30, 2020 and December 31, 2019 . The notional amounts provide an indication of the extent of the Company’s involvement in these instruments at that time, but do not represent exposure to credit, interest rate or market risks (amounts presented in thousands). Hedge Product Hedge Type Designation Notional Amount Strike Trade Date Maturity Date Fair value 9/30/2020 12/31/2019 9/30/2020 12/31/2019 Liabilities Swap Interest Rate Cash Flow (a) $ 250,000 $ 250,000 2.868 % October 8, 2015 October 8, 2022 $ (7,597 ) $ (562 ) Swap Interest Rate Cash Flow (a) 25,774 25,774 3.300 % December 22, 2011 January 30, 2021 (234 ) (94 ) $ 275,774 $ 275,774 (a) Hedging unsecured variable rate debt. |
Beneficiaries Equity of the P_2
Beneficiaries Equity of the Parent Company (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Earnings Per Share (EPS), Basic and Diluted | The following table details the number of shares and net income used to calculate basic and diluted earnings per share (in thousands, except share and per share amounts; results may not add due to rounding): Three Months Ended September 30, 2020 2019 Basic Diluted Basic Diluted Numerator Net income $ 276,133 $ 276,133 $ 6,820 $ 6,820 Net income attributable to noncontrolling interests (1,612 ) (1,612 ) (48 ) (48 ) Nonforfeitable dividends allocated to unvested restricted shareholders (93 ) (93 ) (93 ) (93 ) Net income attributable to common shareholders $ 274,428 $ 274,428 $ 6,679 $ 6,679 Denominator Weighted-average shares outstanding 170,573,028 170,573,028 176,195,244 176,195,244 Contingent securities/Share based compensation — 453,464 — 555,356 Weighted-average shares outstanding 170,573,028 171,026,492 176,195,244 176,750,600 Earnings per Common Share: Net income attributable to common shareholders $ 1.61 $ 1.60 $ 0.04 $ 0.04 Nine Months Ended September 30, 2020 2019 Basic Diluted Basic Diluted Numerator Net income $ 288,240 $ 288,240 $ 17,655 $ 17,655 Net income attributable to noncontrolling interests (1,701 ) (1,701 ) (155 ) (155 ) Nonforfeitable dividends allocated to unvested restricted shareholders (317 ) (317 ) (305 ) (305 ) Net income attributable to common shareholders $ 286,222 $ 286,222 $ 17,195 $ 17,195 Denominator Weighted-average shares outstanding 172,380,410 172,380,410 176,066,507 176,066,507 Contingent securities/Share based compensation — 355,026 — 551,219 Weighted-average shares outstanding 172,380,410 172,735,436 176,066,507 176,617,726 Earnings per Common Share: Net income attributable to common shareholders $ 1.66 $ 1.66 $ 0.10 $ 0.10 |
Partners' Equity Of The Paren_2
Partners' Equity Of The Parent Company (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share (EPS), Basic and Diluted | The following table details the number of shares and net income used to calculate basic and diluted earnings per share (in thousands, except share and per share amounts; results may not add due to rounding): Three Months Ended September 30, 2020 2019 Basic Diluted Basic Diluted Numerator Net income $ 276,133 $ 276,133 $ 6,820 $ 6,820 Net income attributable to noncontrolling interests (1,612 ) (1,612 ) (48 ) (48 ) Nonforfeitable dividends allocated to unvested restricted shareholders (93 ) (93 ) (93 ) (93 ) Net income attributable to common shareholders $ 274,428 $ 274,428 $ 6,679 $ 6,679 Denominator Weighted-average shares outstanding 170,573,028 170,573,028 176,195,244 176,195,244 Contingent securities/Share based compensation — 453,464 — 555,356 Weighted-average shares outstanding 170,573,028 171,026,492 176,195,244 176,750,600 Earnings per Common Share: Net income attributable to common shareholders $ 1.61 $ 1.60 $ 0.04 $ 0.04 Nine Months Ended September 30, 2020 2019 Basic Diluted Basic Diluted Numerator Net income $ 288,240 $ 288,240 $ 17,655 $ 17,655 Net income attributable to noncontrolling interests (1,701 ) (1,701 ) (155 ) (155 ) Nonforfeitable dividends allocated to unvested restricted shareholders (317 ) (317 ) (305 ) (305 ) Net income attributable to common shareholders $ 286,222 $ 286,222 $ 17,195 $ 17,195 Denominator Weighted-average shares outstanding 172,380,410 172,380,410 176,066,507 176,066,507 Contingent securities/Share based compensation — 355,026 — 551,219 Weighted-average shares outstanding 172,380,410 172,735,436 176,066,507 176,617,726 Earnings per Common Share: Net income attributable to common shareholders $ 1.66 $ 1.66 $ 0.10 $ 0.10 |
BRANDYWINE OPERATING PARTNERSHIP, L.P. | |
Earnings Per Share (EPS), Basic and Diluted | The following table details the number of units and net income used to calculate basic and diluted earnings per common partnership unit (in thousands, except unit and per unit amounts; results may not add due to rounding): Three Months Ended September 30, 2020 2019 Basic Diluted Basic Diluted Numerator Net income $ 276,133 $ 276,133 $ 6,820 $ 6,820 Net (income) loss attributable to noncontrolling interests 2 2 (11 ) (11 ) Nonforfeitable dividends allocated to unvested restricted unitholders (93 ) (93 ) (93 ) (93 ) Net income attributable to common unitholders $ 276,042 $ 276,042 $ 6,716 $ 6,716 Denominator Weighted-average units outstanding 171,554,662 171,554,662 177,176,870 177,176,870 Contingent securities/Share based compensation — 453,464 — 555,356 Total weighted-average units outstanding 171,554,662 172,008,126 177,176,870 177,732,226 Earnings per Common Partnership Unit: Net income attributable to common unitholders 1.61 1.60 0.04 0.04 Nine Months Ended September 30, 2020 2019 Basic Diluted Basic Diluted Numerator Net income $ 288,240 $ 288,240 $ 17,655 $ 17,655 Net income attributable to noncontrolling interests (20 ) (20 ) (58 ) (58 ) Nonforfeitable dividends allocated to unvested restricted unitholders (317 ) (317 ) (305 ) (305 ) Net income attributable to common unitholders $ 287,903 $ 287,903 $ 17,292 $ 17,292 Denominator Weighted-average units outstanding 173,362,044 173,362,044 177,048,621 177,048,621 Contingent securities/Share based compensation — 355,026 — 551,219 Total weighted-average units outstanding 173,362,044 173,717,070 177,048,621 177,599,840 Earnings per Common Partnership Unit: Net income attributable to common unitholders $ 1.66 $ 1.66 $ 0.10 $ 0.10 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Real Estate Investments, Net Operating Income and Unconsolidated Real Estate Ventures of Reportable Segments | The following tables provide selected asset information and results of operations of the Company's reportable segments (in thousands): Real estate investments, at cost: September 30, 2020 December 31, 2019 Philadelphia CBD (a) $ 1,414,041 $ 1,726,299 Pennsylvania Suburbs 1,000,214 1,003,890 Austin, Texas 726,295 721,255 Metropolitan Washington, D.C. 488,139 468,035 Other 87,076 86,980 Operating Properties $ 3,715,765 $ 4,006,459 Right of use asset - operating leases, net $ 21,145 $ 21,656 Corporate Construction-in-progress $ 186,853 $ 180,718 Land held for development (b) $ 115,474 $ 96,124 Prepaid leasehold interests in land held for development, net (c) $ 39,287 $ 39,592 (a) Decrease primarily due to the Commerce Square Venture Transaction. See Note 3, ''Real Estate Investments ," for further information. (b) Does not include 35.2 acres of land classified as held for sale as of September 30, 2020 and December 31, 2019 . (c) Includes leasehold interests in prepaid 99 -year ground leases at 3025 and 3001-3003 JFK Boulevard, in Philadelphia, Pennsylvania as of September 30, 2020 and December 31, 2019 . Net operating income: Three Months Ended September 30, 2020 2019 Total revenue Operating expenses (a) Net operating income (loss) Total revenue Operating expenses (a) Net operating income (loss) Philadelphia CBD $ 52,640 $ (18,522 ) $ 34,118 $ 66,105 $ (24,773 ) $ 41,332 Pennsylvania Suburbs 34,649 (11,141 ) 23,508 34,818 (11,667 ) 23,151 Austin, Texas 25,328 (9,944 ) 15,384 26,280 (9,302 ) 16,978 Metropolitan Washington, D.C. 9,675 (5,236 ) 4,439 13,179 (5,999 ) 7,180 Other 3,188 (2,374 ) 814 3,706 (2,691 ) 1,015 Corporate 626 (1,782 ) (1,156 ) 1,243 (1,642 ) (399 ) Operating properties $ 126,106 $ (48,999 ) $ 77,107 $ 145,331 $ (56,074 ) $ 89,257 Nine Months Ended September 30, 2020 2019 Total revenue Operating expenses (a) Net operating income (loss) Total revenue Operating expenses (a) Net operating income (loss) Philadelphia CBD $ 181,203 $ (65,615 ) $ 115,588 $ 196,859 $ (75,311 ) 121,548 Pennsylvania Suburbs 106,569 (34,980 ) 71,589 104,744 (36,466 ) 68,278 Austin, Texas 76,921 (30,032 ) 46,889 77,234 (28,182 ) 49,052 Metropolitan Washington, D.C. 30,520 (15,678 ) 14,842 40,372 (18,542 ) 21,830 Other 10,221 (7,434 ) 2,787 10,352 (7,226 ) 3,126 Corporate 2,597 (4,652 ) (2,055 ) 3,817 (4,969 ) (1,152 ) Operating properties $ 408,031 $ (158,391 ) $ 249,640 $ 433,378 $ (170,696 ) $ 262,682 (a) Includes property operating expenses, real estate taxes and third party management expense. Unconsolidated real estate ventures: Investment in real estate ventures Equity in income (loss) of real estate venture As of Three Months Ended September 30, Nine Months Ended September 30, September 30, 2020 December 31, 2019 2020 2019 2020 2019 Philadelphia CBD (a) $ 277,161 $ 17,524 $ (2,737 ) $ 55 $ (2,575 ) $ 217 Metropolitan Washington, D.C. 100,325 102,840 (1,367 ) (528 ) (2,463 ) (963 ) MAP Venture (b) (9,715 ) (70 ) (1,684 ) (1,602 ) (4,844 ) (4,414 ) Other — — — 110 — 346 Total $ 367,771 $ 120,294 $ (5,788 ) $ (1,965 ) $ (9,882 ) $ (4,814 ) (a) Increase primarily due to the Commerce Square Venture Transaction. See Note 3, ''Real Estate Investments ," for further information. (b) Included in "Other liabilities" on the consolidated balance sheets. |
Reconciliation of Consolidated Net Income to Consolidated NOI | The following is a reconciliation of consolidated net income, as defined by GAAP, to consolidated NOI, (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Net income $ 276,133 $ 6,820 $ 288,240 $ 17,655 Plus: Interest expense 16,310 20,400 56,510 61,273 Interest expense - amortization of deferred financing costs 715 694 2,195 2,026 Depreciation and amortization 43,533 55,627 145,314 158,738 General and administrative expenses 7,069 6,974 23,973 25,217 Equity in loss of Real Estate Ventures 5,788 1,965 9,882 4,814 Less: Interest income 467 558 1,487 1,636 Income tax (provision) benefit (2 ) — 224 (46 ) Net gain on disposition of real estate 271,901 356 274,487 356 Net gain on sale of undepreciated real estate — 250 201 1,501 Net gain on real estate venture transactions 75 2,059 75 3,594 Consolidated net operating income $ 77,107 $ 89,257 $ 249,640 $ 262,682 |
Organization of The Parent Co_3
Organization of The Parent Company and The Operating Partnership - Textual (Details) | 9 Months Ended |
Sep. 30, 2020aft²parcelproperty | |
Organization of The Parent Company and The Operating Partnership [Line Items] | |
Number of properties | property | 92 |
Net rentable area (in square feet) | 14,691,346 |
Parent Company | |
Organization of The Parent Company and The Operating Partnership [Line Items] | |
Areas of land held for development (in acres) | a | 228.5 |
Area of land held for sale (in acres) | a | 35.2 |
Area of additional undeveloped parcels of land with option to purchase (in acres) | a | 55.5 |
Total potential development capacity (in square feet) | 14,200,000 |
Parent Company | Land Parcel One | |
Organization of The Parent Company and The Operating Partnership [Line Items] | |
Lease agreement term | 99 years |
Parent Company | Land Parcel Two | |
Organization of The Parent Company and The Operating Partnership [Line Items] | |
Lease agreement term | 99 years |
Parent Company | Held-for-sale | |
Organization of The Parent Company and The Operating Partnership [Line Items] | |
Total potential development capacity (in square feet) | 200,000 |
Parent Company | Leashold Interest Land | |
Organization of The Parent Company and The Operating Partnership [Line Items] | |
Areas of land held for development (in acres) | a | 1.8 |
Number of parcels of land | parcel | 2 |
Wholly-owned Management Company Subsidiaries | |
Organization of The Parent Company and The Operating Partnership [Line Items] | |
Net rentable area (in square feet) | 24,400,000 |
Wholly-owned Management Company Subsidiaries | Wholly Owned Properties | |
Organization of The Parent Company and The Operating Partnership [Line Items] | |
Net rentable area (in square feet) | 14,700,000 |
Wholly-owned Management Company Subsidiaries | Partially Owned Properties | |
Organization of The Parent Company and The Operating Partnership [Line Items] | |
Net rentable area (in square feet) | 9,700,000 |
Brandywine Operating Partnership LP | |
Organization of The Parent Company and The Operating Partnership [Line Items] | |
Ownership in the operating partnership | 99.40% |
Unconsolidated Real Estate Ventures | Unconsolidated Properties | |
Organization of The Parent Company and The Operating Partnership [Line Items] | |
Number of properties | property | 8 |
Organization of The Parent Co_4
Organization of The Parent Company and The Operating Partnership - Summary of Core Portfolio of Operating Properties and Excludes Development, Redevelopment and Held for Sale (Details) | Sep. 30, 2020ft²property |
Real Estate Properties [Line Items] | |
Number of properties | property | 92 |
Net rentable area (in square feet) | ft² | 14,691,346 |
Office properties | |
Real Estate Properties [Line Items] | |
Number of properties | property | 84 |
Net rentable area (in square feet) | ft² | 13,641,289 |
Mixed-use properties | |
Real Estate Properties [Line Items] | |
Number of properties | property | 5 |
Net rentable area (in square feet) | ft² | 780,184 |
Core Properties | |
Real Estate Properties [Line Items] | |
Number of properties | property | 89 |
Net rentable area (in square feet) | ft² | 14,421,473 |
Development property | |
Real Estate Properties [Line Items] | |
Number of properties | property | 1 |
Net rentable area (in square feet) | ft² | 205,803 |
Redevelopment properties | |
Real Estate Properties [Line Items] | |
Number of properties | property | 2 |
Net rentable area (in square feet) | ft² | 64,070 |
Real Estate Investments - Gross
Real Estate Investments - Gross Carrying Value of Operating Properties (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Real Estate [Abstract] | ||
Land | $ 437,617 | $ 489,702 |
Building and improvements | 2,851,185 | 3,049,395 |
Tenant improvements | 426,963 | 467,362 |
Total | $ 3,715,765 | $ 4,006,459 |
Real Estate Investments - Summa
Real Estate Investments - Summary of Properties Acquired (Details) $ in Thousands | Feb. 27, 2020USD ($)a | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) |
Real Estate [Line Items] | |||
Purchase price | $ 11,432 | $ 0 | |
Land | 145 King of Prussia Road | |||
Real Estate [Line Items] | |||
Area of land (in acres) | a | 7.75 | ||
Purchase price | $ 11,250 |
Real Estate Investments - Sum_2
Real Estate Investments - Summary of Properties Sold (Details) $ in Thousands | Jul. 21, 2020USD ($)ft² | Jun. 15, 2020USD ($)a | Mar. 19, 2020USD ($)ft² | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Proceeds from the sale of properties | $ 122,055 | $ 41,546 | |||||
Gain (loss) on sale | $ 271,901 | $ 356 | $ 274,487 | $ 356 | |||
One and Two Commerce Square | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Sale of ownership interest percentage | 30.00% | ||||||
Total sale price for property sold | $ 115,000 | ||||||
Value of properties sold | $ 600,000 | ||||||
Gain on sale | $ 271,900 | ||||||
Office properties | 52 East Swedesford Road | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Rentable area (in square feet) | ft² | 131,077 | ||||||
Proceeds from the sale of properties | $ 18,000 | ||||||
Gain (loss) on sale | $ 2,336 | ||||||
Office properties | One and Two Commerce Square | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Rentable area (in square feet) | ft² | 1,896,142 | ||||||
Proceeds from the sale of properties | $ 115,000 | ||||||
Gain (loss) on sale | $ 271,905 | ||||||
Land | Keith Valley | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Area of land (in acres) | a | 14 | ||||||
Proceeds from the sale of properties | $ 4,000 | ||||||
Gain (loss) on sale | $ 201 |
Real Estate Investments - Textu
Real Estate Investments - Textual (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020USD ($)aparcel | Dec. 31, 2019USD ($)a | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Assets held for sale, net | $ | $ 7,349 | $ 7,349 |
Held-for-sale | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Area of land (in acres) | a | 35.2 | 35.2 |
Other - Land | Held-for-sale | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Assets held for sale, net | $ | $ 7,300 | |
Other - Land | Held-for-sale | Other | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Number of parcels of land | parcel | 2 | |
Area of land (in acres) | a | 35.2 |
Investment in Unconsolidated _3
Investment in Unconsolidated Real Estate Ventures - Textual (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2020USD ($)aft²investmentpropertyapartment | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($)aft²investmentpropertyapartment | Sep. 30, 2019USD ($) | Jul. 21, 2020USD ($)ft² | Dec. 31, 2019USD ($) | |
Schedule of Equity Method Investments [Line Items] | ||||||
Number of properties | property | 92 | 92 | ||||
Investment in Real Estate Ventures | $ 377,486 | $ 377,486 | $ 120,294 | |||
Accounts receivable | 20,433 | 20,433 | 16,363 | |||
Debt, net | $ 1,919,511 | $ 1,919,511 | 2,144,418 | |||
Minimum | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Ownership percentage | 15.00% | 15.00% | ||||
Maximum | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Ownership percentage | 70.00% | 70.00% | ||||
Real Estate Venture | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Accounts receivable | $ 1,400 | $ 1,400 | 800 | |||
Real Estate Venture | Management Fees | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Service and other revenue | 1,300 | $ 1,000 | 3,200 | $ 3,200 | ||
Real Estate Venture | Leasing Commission Income | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Service and other revenue | 200 | $ 300 | 900 | $ 800 | ||
Unconsolidated Real Estate Ventures | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investment in Real Estate Ventures | $ 367,800 | $ 367,800 | ||||
Unconsolidated Real Estate Ventures | Office properties | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Number of unconsolidated investments in Real Estate Ventures | investment | 4 | 4 | ||||
Rentable area (in square feet) | ft² | 7,300,000 | 7,300,000 | ||||
Unconsolidated Real Estate Ventures | Unconsolidated Properties | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Number of properties | property | 8 | 8 | ||||
Number of properties with negative investment balances | property | 1 | 1 | ||||
Unconsolidated Real Estate Ventures | Land Held For Development | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Number of unconsolidated investments in Real Estate Ventures | investment | 2 | 2 | ||||
Area of land (in acres) | a | 1.4 | 1.4 | ||||
Unconsolidated Real Estate Ventures | Land Under Active Development | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Number of unconsolidated investments in Real Estate Ventures | investment | 1 | 1 | ||||
Area of land (in acres) | a | 1.3 | 1.3 | ||||
Unconsolidated Real Estate Ventures | Residential Tower | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Number of unconsolidated investments in Real Estate Ventures | investment | 1 | 1 | ||||
Number of apartment units (in units) | apartment | 321 | 321 | ||||
One and Two Commerce Square | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Ownership percentage | 70.00% | 70.00% | ||||
Secured Debt | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Debt, net | $ 88,913 | $ 88,913 | $ 313,812 | |||
Secured Debt | Philadelphia - Office | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Debt, net | $ 222,100 | |||||
Preferred Equity Securities | One and Two Commerce Square | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Ownership percentage | 32.00% | 32.00% | ||||
Common Equity Securities | One and Two Commerce Square | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Ownership percentage | 38.00% | 38.00% | ||||
Other Liabilities | Unconsolidated Real Estate Ventures | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investment in Real Estate Ventures | $ (9,700) | $ (9,700) | ||||
One and Two Commerce Square | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Sale of ownership interest percentage | 30.00% | |||||
One and Two Commerce Square | Office properties | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Rentable area (in square feet) | ft² | 1,896,142 |
Investment in Unconsolidated _4
Investment in Unconsolidated Real Estate Ventures - Summary of Financial Position of Real Estate Ventures (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Schedule of Equity Method Investments [Line Items] | ||||||||
Net property | $ 3,097,860 | $ 3,371,231 | ||||||
Other assets | 124,408 | 115,678 | ||||||
Other liabilities | 40,537 | 15,985 | ||||||
Debt, net | 1,919,511 | 2,144,418 | ||||||
Equity | 1,815,782 | $ 1,570,849 | $ 1,603,814 | 1,688,303 | $ 1,702,437 | $ 1,729,665 | $ 1,760,463 | $ 1,811,028 |
Investment In Nonconsolidated Real Estate | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Net property | 1,363,889 | 834,367 | ||||||
Other assets | 442,834 | 342,002 | ||||||
Other liabilities | 323,442 | 290,071 | ||||||
Debt, net | 833,716 | 585,068 | ||||||
Equity | $ 649,565 | $ 301,230 |
Investment in Unconsolidated _5
Investment in Unconsolidated Real Estate Ventures - Summary of Results of Operations of Real Estate Ventures with Interests (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Schedule of Equity Method Investments [Line Items] | ||||||||
Revenue | $ 126,106 | $ 145,331 | $ 408,031 | $ 433,378 | ||||
Operating expenses | (99,601) | (118,675) | (327,678) | (354,651) | ||||
Interest expense | (16,310) | (20,400) | (56,510) | (61,273) | ||||
Depreciation and amortization | (43,533) | (55,627) | (145,314) | (158,738) | ||||
Net income | 276,133 | $ 4,020 | $ 8,087 | 6,820 | $ 6,252 | $ 4,583 | 288,240 | 17,655 |
Equity in loss of Real Estate Ventures | (5,788) | (1,965) | (9,882) | (4,814) | ||||
Investment In Nonconsolidated Real Estate | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Revenue | 43,109 | 32,726 | 105,554 | 101,148 | ||||
Operating expenses | (23,870) | (17,869) | (59,838) | (53,956) | ||||
Interest expense | (6,175) | (6,180) | (16,320) | (16,421) | ||||
Depreciation and amortization | (22,345) | (13,094) | (47,493) | (40,279) | ||||
Gain on early extinguishment of debt | 0 | 4,371 | 0 | 4,371 | ||||
Net income | (9,281) | (46) | (18,097) | (5,137) | ||||
Company's share of net loss | (5,812) | (1,945) | (9,892) | (4,765) | ||||
Basis adjustments and other | 24 | (20) | 10 | (49) | ||||
Equity in loss of Real Estate Ventures | $ (5,788) | $ (1,965) | $ (9,882) | $ (4,814) |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Leases [Abstract] | ||||
Fixed contractual payments | $ 95,751 | $ 105,073 | $ 302,146 | $ 314,999 |
Variable lease payments | 22,716 | 27,475 | 80,824 | 83,989 |
Total | $ 118,467 | $ 132,548 | $ 382,970 | $ 398,988 |
Intangible Assets and Liabili_3
Intangible Assets and Liabilities - Intangible Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Intangible Assets [Line Items] | ||
Intangible assets, total cost | $ 93,254 | $ 177,581 |
Intangible assets, accumulated amortization | (42,539) | (92,730) |
Intangible assets, net | 50,715 | 84,851 |
Intangible liabilities, net | 44,757 | |
Acquired lease intangibles, accumulated amortization | (22,494) | |
Acquired lease intangibles, net | 17,500 | 22,263 |
In-place lease value | ||
Intangible Assets [Line Items] | ||
Intangible assets, total cost | 89,504 | 167,357 |
Intangible assets, accumulated amortization | (39,302) | (84,123) |
Intangible assets, net | 50,202 | 83,234 |
Tenant relationship value | ||
Intangible Assets [Line Items] | ||
Intangible assets, total cost | 2,610 | 5,268 |
Intangible assets, accumulated amortization | (2,399) | (4,815) |
Intangible assets, net | 211 | 453 |
Above market leases acquired | ||
Intangible Assets [Line Items] | ||
Intangible assets, total cost | 1,140 | 4,956 |
Intangible assets, accumulated amortization | (838) | (3,792) |
Intangible assets, net | 302 | $ 1,164 |
Below market leases acquired | ||
Intangible Assets [Line Items] | ||
Intangible liabilities, net | 29,189 | |
Acquired lease intangibles, accumulated amortization | (11,689) | |
Acquired lease intangibles, net | $ 17,500 |
Intangible Assets and Liabili_4
Intangible Assets and Liabilities - Annual Amortization of Intangible Assets, Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Assets | ||
2020 (three months remaining) | $ 4,273 | |
2021 | 14,789 | |
2022 | 9,627 | |
2023 | 7,564 | |
2024 | 5,214 | |
Thereafter | 9,248 | |
Intangible assets, net | 50,715 | $ 84,851 |
Liabilities | ||
2020 (three months remaining) | 1,011 | |
2021 | 3,601 | |
2022 | 2,065 | |
2023 | 1,651 | |
2024 | 1,425 | |
Thereafter | 7,747 | |
Acquired lease intangibles, net | $ 17,500 | $ 22,263 |
Debt Obligations - Consolidated
Debt Obligations - Consolidated Debt Obligations Outstanding (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Consolidated debt obligations | ||
Plus: premiums/(discounts), net | $ 10,651 | |
Less: deferred financing costs | (8,638) | |
Outstanding indebtedness | 1,919,511 | $ 2,144,418 |
Secured Debt | ||
Consolidated debt obligations | ||
Principal balance outstanding | 88,888 | 315,437 |
Plus: premiums/(discounts), net | 25 | (1,383) |
Less: deferred financing costs | 0 | (242) |
Outstanding indebtedness | 88,913 | 313,812 |
Secured Debt | Two Logan Square | ||
Consolidated debt obligations | ||
Principal balance outstanding | $ 79,781 | 81,103 |
Effective interest rate | 3.98% | |
Secured Debt | Four Tower Bridge | ||
Consolidated debt obligations | ||
Principal balance outstanding | $ 9,107 | 9,291 |
Effective interest rate | 4.50% | |
Secured Debt | One Commerce Square | ||
Consolidated debt obligations | ||
Principal balance outstanding | $ 0 | 116,571 |
Effective interest rate | 3.64% | |
Secured Debt | Two Commerce Square | ||
Consolidated debt obligations | ||
Principal balance outstanding | $ 0 | 108,472 |
Effective interest rate | 4.51% | |
Unsecured Debt | ||
Consolidated debt obligations | ||
Principal balance outstanding | $ 1,828,610 | 1,828,610 |
Plus: premiums/(discounts), net | 10,626 | 12,090 |
Less: deferred financing costs | (8,638) | (10,094) |
Outstanding indebtedness | 1,830,598 | 1,830,606 |
Unsecured Debt | Seven-Year Term Loan - Swapped to fixed | ||
Consolidated debt obligations | ||
Principal balance outstanding | $ 250,000 | 250,000 |
Effective interest rate | 2.87% | |
Unsecured Debt | $350.0M 3.95% Guaranteed Notes due 2023 | ||
Consolidated debt obligations | ||
Principal balance outstanding | $ 350,000 | 350,000 |
Effective interest rate | 3.87% | |
Unsecured Debt | $350.0M 4.10% Guaranteed Notes due 2024 | ||
Consolidated debt obligations | ||
Principal balance outstanding | $ 350,000 | 350,000 |
Effective interest rate | 3.78% | |
Unsecured Debt | $450.0M 3.95% Guaranteed Notes due 2027 | ||
Consolidated debt obligations | ||
Principal balance outstanding | $ 450,000 | 450,000 |
Effective interest rate | 4.03% | |
Unsecured Debt | $350.0M 4.55% Guaranteed Notes due 2029 | ||
Consolidated debt obligations | ||
Principal balance outstanding | $ 350,000 | 350,000 |
Effective interest rate | 4.30% | |
Unsecured Debt | Indenture IA (Preferred Trust I) | ||
Consolidated debt obligations | ||
Principal balance outstanding | $ 27,062 | 27,062 |
Unsecured Debt | Indenture IA (Preferred Trust I) | LIBOR | ||
Consolidated debt obligations | ||
Spread on variable rate | 1.25% | |
Unsecured Debt | Indenture IB (Preferred Trust I) - Swapped to fixed | ||
Consolidated debt obligations | ||
Principal balance outstanding | $ 25,774 | 25,774 |
Effective interest rate | 3.30% | |
Unsecured Debt | Indenture II (Preferred Trust II) | ||
Consolidated debt obligations | ||
Principal balance outstanding | $ 25,774 | $ 25,774 |
Unsecured Debt | Indenture II (Preferred Trust II) | LIBOR | ||
Consolidated debt obligations | ||
Spread on variable rate | 1.25% |
Debt Obligations - Textual (Det
Debt Obligations - Textual (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | $ 600,000,000 | |
Weighted average interest rate | 1.60% | |
LIBOR | Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Spread on variable rate | 1.10% | |
Unsecured Debt | ||
Debt Instrument [Line Items] | ||
Principal balance outstanding | $ 1,828,610,000 | $ 1,828,610,000 |
Unsecured Debt | $600 million Unsecured Credit Facility | ||
Debt Instrument [Line Items] | ||
Principal balance outstanding | $ 0 |
Debt Obligations - Aggregate Sc
Debt Obligations - Aggregate Scheduled Principal Payments of Debt Obligation, Excluding Amortization of Discounts and Premiums (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Debt Disclosure [Abstract] | ||
2020 (three months remaining) | $ 79,845 | |
2021 | 9,043 | |
2022 | 250,000 | |
2023 | 350,000 | |
2024 | 350,000 | |
Thereafter | 878,610 | |
Total principal payments | 1,917,498 | |
Net unamortized premiums/(discounts) | 10,651 | |
Net deferred financing costs | (8,638) | |
Outstanding indebtedness | $ 1,919,511 | $ 2,144,418 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Financial Instruments for which Estimates of Fair Value Differ from Carrying Amounts (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Mortgage notes payable | $ 88,913 | $ 313,812 |
Deferred financing costs, net | 8,638 | |
Unsecured notes payable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Deferred financing costs, net | 8,638 | 10,094 |
Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Notes receivable | 44,430 | 44,430 |
Carrying Amount | Unsecured notes payable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Unsecured notes payable | 1,503,035 | 1,503,435 |
Deferred financing costs, net | 7,600 | 8,700 |
Carrying Amount | Variable rate debt | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Variable rate debt | 327,563 | 327,171 |
Deferred financing costs, net | 1,000 | 1,400 |
Carrying Amount | Mortgage notes payable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Mortgage notes payable | 88,913 | 313,812 |
Deferred financing costs, net | 0 | 200 |
Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Note receivable, fair value | 47,415 | 43,322 |
Fair Value | Unsecured notes payable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt instrument, fair value | 1,566,650 | 1,591,830 |
Fair Value | Variable rate debt | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt instrument, fair value | 308,519 | 309,947 |
Fair Value | Mortgage notes payable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt instrument, fair value | $ 89,034 | $ 317,031 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Textual (Details) - Brandywine 1919 Ventures $ in Millions | Jun. 26, 2018USD ($) |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Mortgage loan | $ 44.4 |
Equity method investment, ownership percentage | 50.00% |
Other Assets | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Mortgage loan | $ 44.4 |
Derivative Financial Instrume_3
Derivative Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Derivatives, Fair Value [Line Items] | ||
Derivative, notional amount | $ 275,774 | $ 275,774 |
2.868% Interest Rate Swap Maturing October 8, 2022 | Cash Flow Hedging | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability, notional amount | $ 250,000 | 250,000 |
Derivative, fixed interest rate | 2.868% | |
Derivative liability, fair value, gross liability | $ (7,597) | (562) |
3.300% Interest Rate Swap Maturing January 30, 2021 | Cash Flow Hedging | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability, notional amount | $ 25,774 | 25,774 |
Derivative, fixed interest rate | 3.30% | |
Derivative liability, fair value, gross liability | $ (234) | $ (94) |
Limited Partners' Non-Control_2
Limited Partners' Non-Controlling Interests in the Parent Company (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Noncontrolling Interest [Abstract] | ||
Aggregate amount related to non-controlling interests classified within equity | $ 10.5 | $ 9.3 |
Settlement value of non controlling interest in operating partnership | $ 10.2 | $ 15.5 |
Beneficiaries Equity of the P_3
Beneficiaries Equity of the Parent Company - Number of Shares and Net Income Used to Calculate Basic and Diluted Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Numerator | ||||||||
Net income | $ 276,133 | $ 4,020 | $ 8,087 | $ 6,820 | $ 6,252 | $ 4,583 | $ 288,240 | $ 17,655 |
Net income attributable to noncontrolling interests, Basic | (1,612) | (48) | (1,701) | (155) | ||||
Nonforfeitable dividends allocated to unvested restricted shareholders, Basic | (93) | (93) | (317) | (305) | ||||
Net income attributable to noncontrolling interests, Diluted | (1,612) | (48) | (1,701) | (155) | ||||
Nonforfeitable dividends allocated to unvested restricted shareholders, Diluted | (93) | (93) | (317) | (305) | ||||
Net income attributable to Common Shareholders of Brandywine Realty Trust | 274,428 | 6,679 | 286,222 | 17,195 | ||||
Net income attributable to common shareholders, Diluted | $ 274,428 | $ 6,679 | $ 286,222 | $ 17,195 | ||||
Denominator | ||||||||
Basic weighted average shares outstanding (in shares) | 170,573,028 | 176,195,244 | 172,380,410 | 176,066,507 | ||||
Contingent securities/Share based compensation (in shares) | 453,464 | 555,356 | 355,026 | 551,219 | ||||
Diluted weighted average shares outstanding (in shares) | 171,026,492 | 176,750,600 | 172,735,436 | 176,617,726 | ||||
Earnings per Common Share: | ||||||||
Net income attributable to common shareholders, Basic (USD per share) | $ 1.61 | $ 0.04 | $ 1.66 | $ 0.10 | ||||
Net income attributable to common shareholders, Diluted (USD per share) | $ 1.60 | $ 0.04 | $ 1.66 | $ 0.10 |
Beneficiaries Equity of the P_4
Beneficiaries Equity of the Parent Company - Textual (Details) - USD ($) | Sep. 15, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Jan. 03, 2019 |
Class of Stock [Line Items] | |||||||
Dividends, common stock | $ 32,700,000 | ||||||
Shares repurchased and retired (in shares) | 6,248,483 | 1,337,169 | |||||
Share price (in dollars per share) | $ 9.60 | $ 12.92 | |||||
Value of stock repurchased and retired | $ 6,141,000 | $ 53,858,000 | $ 17,281,000 | $ 60,000,000 | $ 17,300,000 | ||
Maximum | |||||||
Class of Stock [Line Items] | |||||||
Share repurchase, authorized amount | $ 150,000,000 | ||||||
Dividend declared | |||||||
Class of Stock [Line Items] | |||||||
Dividends payable (in dollars per share) | $ 0.19 | ||||||
Redeemable Common Limited Partnership Units | |||||||
Class of Stock [Line Items] | |||||||
Redeemable common limited partnership units (in shares) | 981,634 | 981,626 |
Partners' Equity Of The Paren_3
Partners' Equity Of The Parent Company - Number of Units and Net Income Used to Calculate Basic and Diluted Earnings Per Common Partnership Unit (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Numerator | ||||||||
Net income | $ 276,133 | $ 4,020 | $ 8,087 | $ 6,820 | $ 6,252 | $ 4,583 | $ 288,240 | $ 17,655 |
Nonforfeitable dividends allocated to unvested restricted shareholders, Basic | (93) | (93) | (317) | (305) | ||||
Nonforfeitable dividends allocated to unvested restricted shareholders, Diluted | $ (93) | $ (93) | $ (317) | $ (305) | ||||
Denominator | ||||||||
Basic weighted average shares outstanding (in shares) | 170,573,028 | 176,195,244 | 172,380,410 | 176,066,507 | ||||
Contingent securities/Share based compensation (in shares) | 453,464 | 555,356 | 355,026 | 551,219 | ||||
Diluted weighted average shares outstanding (in shares) | 171,026,492 | 176,750,600 | 172,735,436 | 176,617,726 | ||||
Earnings per Common Partnership Unit: | ||||||||
Net income attributable to common shareholders, Basic (USD per share) | $ 1.61 | $ 0.04 | $ 1.66 | $ 0.10 | ||||
Net income attributable to common shareholders, Diluted (USD per share) | $ 1.60 | $ 0.04 | $ 1.66 | $ 0.10 | ||||
BRANDYWINE OPERATING PARTNERSHIP, L.P. | ||||||||
Numerator | ||||||||
Net income | $ 276,133 | $ 4,020 | $ 8,087 | $ 6,820 | $ 6,252 | $ 4,583 | $ 288,240 | $ 17,655 |
Net income attributable to noncontrolling interests | 2 | (11) | (20) | (58) | ||||
Nonforfeitable dividends allocated to unvested restricted shareholders, Basic | (93) | (93) | (317) | (305) | ||||
Nonforfeitable dividends allocated to unvested restricted shareholders, Diluted | (93) | (93) | (317) | (305) | ||||
Net income attributable to common unitholders, Basic | 276,042 | 6,716 | 287,903 | 17,292 | ||||
Net income attributable to common unitholders, Diluted | $ 276,042 | $ 6,716 | $ 287,903 | $ 17,292 | ||||
Denominator | ||||||||
Basic weighted average shares outstanding (in shares) | 171,554,662 | 177,176,870 | 173,362,044 | 177,048,621 | ||||
Contingent securities/Share based compensation (in shares) | 453,464 | 555,356 | 355,026 | 551,219 | ||||
Diluted weighted average shares outstanding (in shares) | 172,008,126 | 177,732,226 | 173,717,070 | 177,599,840 | ||||
Earnings per Common Partnership Unit: | ||||||||
Net income attributable to common shareholders, Basic (USD per share) | $ 1.61 | $ 0.04 | $ 1.66 | $ 0.10 | ||||
Net income attributable to common shareholders, Diluted (USD per share) | $ 1.60 | $ 0.04 | $ 1.66 | $ 0.10 |
Partners' Equity Of The Paren_4
Partners' Equity Of The Parent Company - Textual (Details) $ / shares in Units, $ in Thousands | Sep. 15, 2020USD ($)$ / shares | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | Sep. 30, 2020USD ($)$ / sharesshares | Sep. 30, 2019USD ($)$ / sharesshares |
Earnings Per Common Partnership Unit [Line Items] | ||||||
Dividends, common stock | $ | $ 32,700 | |||||
Shares repurchased and retired (in shares) | shares | 6,248,483 | 1,337,169 | ||||
Share price (in dollars per share) | $ / shares | $ 9.60 | $ 12.92 | ||||
Value of stock repurchased and retired | $ | $ 6,141 | $ 53,858 | $ 17,281 | $ 60,000 | $ 17,300 | |
Dividend declared | ||||||
Earnings Per Common Partnership Unit [Line Items] | ||||||
Dividends payable (in dollars per share) | $ / shares | $ 0.19 | |||||
BRANDYWINE OPERATING PARTNERSHIP, L.P. | ||||||
Earnings Per Common Partnership Unit [Line Items] | ||||||
Dividends, common stock | $ | $ 32,700 | |||||
Repurchase program, ratio of mirror unit of operating partnership retired for each common share repurchased | 1 | |||||
BRANDYWINE OPERATING PARTNERSHIP, L.P. | Dividend declared | ||||||
Earnings Per Common Partnership Unit [Line Items] | ||||||
Dividends payable (in dollars per share) | $ / shares | $ 0.19 |
Segment Information (Textual) (
Segment Information (Textual) (Details) | 9 Months Ended |
Sep. 30, 2020segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 5 |
Segment Information - Real Esta
Segment Information - Real Estate Investments, at Cost of Company's Reportable Segments (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Segment Reporting Information [Line Items] | ||
Operating properties | $ 3,715,765 | $ 4,006,459 |
Operating Properties | 3,715,765 | 4,006,459 |
Right of use asset - operating leases, net | 21,145 | 21,656 |
Construction-in-progress | 186,853 | 180,718 |
Land held for development | 115,474 | 96,124 |
Prepaid leasehold interests in land held for development, net | 39,287 | 39,592 |
Philadelphia CBD | ||
Segment Reporting Information [Line Items] | ||
Operating properties | 1,414,041 | 1,726,299 |
Pennsylvania Suburbs | ||
Segment Reporting Information [Line Items] | ||
Operating properties | 1,000,214 | 1,003,890 |
Austin, Texas | ||
Segment Reporting Information [Line Items] | ||
Operating properties | 726,295 | 721,255 |
Metropolitan Washington, D.C. | ||
Segment Reporting Information [Line Items] | ||
Operating properties | 488,139 | 468,035 |
Other | ||
Segment Reporting Information [Line Items] | ||
Operating properties | $ 87,076 | $ 86,980 |
Segment Information - Real Es_2
Segment Information - Real Estate Investments, at Cost of Company's Reportable Segments (Additional Information) (Details) - a | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
3001-3003 and 3025 JFK Boulevard | ||
Segment Reporting Information [Line Items] | ||
Lease agreement term | 99 years | 99 years |
Held-for-sale | ||
Segment Reporting Information [Line Items] | ||
Area of land (in acres) | 35.2 | 35.2 |
Segment Information - Net Opera
Segment Information - Net Operating Income of Company's Reportable Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Segment Reporting Information [Line Items] | ||||
Total revenue | $ 126,106 | $ 145,331 | $ 408,031 | $ 433,378 |
Operating expenses | (48,999) | (56,074) | (158,391) | (170,696) |
Net operating income (loss) | 77,107 | 89,257 | 249,640 | 262,682 |
Operating Segments | Philadelphia CBD | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 52,640 | 66,105 | 181,203 | 196,859 |
Operating expenses | (18,522) | (24,773) | (65,615) | (75,311) |
Net operating income (loss) | 34,118 | 41,332 | 115,588 | 121,548 |
Operating Segments | Pennsylvania Suburbs | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 34,649 | 34,818 | 106,569 | 104,744 |
Operating expenses | (11,141) | (11,667) | (34,980) | (36,466) |
Net operating income (loss) | 23,508 | 23,151 | 71,589 | 68,278 |
Operating Segments | Austin, Texas | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 25,328 | 26,280 | 76,921 | 77,234 |
Operating expenses | (9,944) | (9,302) | (30,032) | (28,182) |
Net operating income (loss) | 15,384 | 16,978 | 46,889 | 49,052 |
Operating Segments | Metropolitan Washington, D.C. | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 9,675 | 13,179 | 30,520 | 40,372 |
Operating expenses | (5,236) | (5,999) | (15,678) | (18,542) |
Net operating income (loss) | 4,439 | 7,180 | 14,842 | 21,830 |
Operating Segments | Other | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 3,188 | 3,706 | 10,221 | 10,352 |
Operating expenses | (2,374) | (2,691) | (7,434) | (7,226) |
Net operating income (loss) | 814 | 1,015 | 2,787 | 3,126 |
Corporate | ||||
Segment Reporting Information [Line Items] | ||||
Total revenue | 626 | 1,243 | 2,597 | 3,817 |
Operating expenses | (1,782) | (1,642) | (4,652) | (4,969) |
Net operating income (loss) | $ (1,156) | $ (399) | $ (2,055) | $ (1,152) |
Segment Information - Unconsoli
Segment Information - Unconsolidated Real Estate Ventures of Company's Reportable Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Segment Reporting Information [Line Items] | |||||
Investment in real estate ventures | $ 367,771 | $ 367,771 | $ 120,294 | ||
Equity in loss of real estate ventures | (5,788) | $ (1,965) | (9,882) | $ (4,814) | |
Philadelphia CBD | |||||
Segment Reporting Information [Line Items] | |||||
Investment in real estate ventures | 277,161 | 277,161 | 17,524 | ||
Equity in loss of real estate ventures | (2,737) | 55 | (2,575) | 217 | |
Metropolitan Washington, D.C. | |||||
Segment Reporting Information [Line Items] | |||||
Investment in real estate ventures | 100,325 | 100,325 | 102,840 | ||
Equity in loss of real estate ventures | (1,367) | (528) | (2,463) | (963) | |
MAP Venture | |||||
Segment Reporting Information [Line Items] | |||||
Investment in real estate ventures | (9,715) | (9,715) | (70) | ||
Equity in loss of real estate ventures | (1,684) | (1,602) | (4,844) | (4,414) | |
Other | |||||
Segment Reporting Information [Line Items] | |||||
Investment in real estate ventures | 0 | 0 | $ 0 | ||
Equity in loss of real estate ventures | $ 0 | $ 110 | $ 0 | $ 346 |
Segment Information - Reconcili
Segment Information - Reconciliation of Consolidated Net Income to Consolidated NOI (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Segment Reporting [Abstract] | ||||||||
Net income | $ 276,133 | $ 4,020 | $ 8,087 | $ 6,820 | $ 6,252 | $ 4,583 | $ 288,240 | $ 17,655 |
Plus: | ||||||||
Interest expense | 16,310 | 20,400 | 56,510 | 61,273 | ||||
Interest expense - amortization of deferred financing costs | 715 | 694 | 2,195 | 2,026 | ||||
Depreciation and amortization | 43,533 | 55,627 | 145,314 | 158,738 | ||||
General and administrative expenses | 7,069 | 6,974 | 23,973 | 25,217 | ||||
Equity in loss of Real Estate Ventures | 5,788 | 1,965 | 9,882 | 4,814 | ||||
Less: | ||||||||
Interest income | 467 | 558 | 1,487 | 1,636 | ||||
Income tax (provision) benefit | (2) | 0 | 224 | (46) | ||||
Net gain on disposition of real estate | 271,901 | 356 | 274,487 | 356 | ||||
Net gain on sale of undepreciated real estate | 0 | 250 | 201 | 1,501 | ||||
Net gain on real estate venture transactions | 75 | 2,059 | 75 | 3,594 | ||||
Consolidated net operating income | $ 77,107 | $ 89,257 | $ 249,640 | $ 262,682 |
Commitments and Contingencies (
Commitments and Contingencies (Details) ft² in Thousands | 9 Months Ended | |
Sep. 30, 2020USD ($)ft² | Dec. 31, 2019USD ($) | |
Property Subject to or Available for Operating Lease [Line Items] | ||
Debt, net | $ 1,919,511,000 | $ 2,144,418,000 |
4040 Wilson Venture | ||
Property Subject to or Available for Operating Lease [Line Items] | ||
Debt, net | 150,000,000 | |
Guarantees, maximum exposure amount | 41,300,000 | |
Unconsolidated Real Estate Ventures | ||
Property Subject to or Available for Operating Lease [Line Items] | ||
Real estate ventures aggregate indebtedness | $ 842,200,000 | |
Radnor PA Property | ||
Property Subject to or Available for Operating Lease [Line Items] | ||
Rentable area (in square feet) | ft² | 170 | |
Payments to acquire buildings | $ 20,300,000 | |
Payments for deposits on real estate acquisitions | 1,000,000 | |
One and Two Commerce Square | Preferred Equity Investment | ||
Property Subject to or Available for Operating Lease [Line Items] | ||
Other commitments | 20,000,000 | |
Drexel Square | ||
Property Subject to or Available for Operating Lease [Line Items] | ||
Other commitments | 7,700,000 | |
Estimated potential additional contribution obligation | 2,600,000 | |
Mortgage Lenders | ||
Property Subject to or Available for Operating Lease [Line Items] | ||
Associated letter of credit | $ 0 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Millions | Oct. 21, 2020USD ($) |
Secured Debt | Two Logan Square | Subsequent Event | |
Subsequent Event [Line Items] | |
Acquisition of mortgage loan | $ 79.8 |