COVER PAGE
COVER PAGE - shares | 3 Months Ended | |
Mar. 31, 2020 | May 01, 2020 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-32268 | |
Entity Registrant Name | Kite Realty Group Trust | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 11-3715772 | |
Entity Address, Address Line One | 30 S. Meridian Street | |
Entity Address, Address Line Two | Suite 1100 | |
Entity Address, City or Town | Indianapolis | |
Entity Address, State or Province | IN | |
Entity Address, Postal Zip Code | 46204 | |
City Area Code | 317 | |
Local Phone Number | 577-5600 | |
Title of 12(b) Security | Common stock, $0.01 par value per share | |
Trading Symbol | KRG | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 84,117,813 | |
Entity Central Index Key | 0001286043 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
KRG, LP | ||
Entity Information [Line Items] | ||
Entity File Number | 333-202666-01 | |
Entity Registrant Name | Kite Realty Group, L.P. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 20-1453863 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001636315 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Assets: | ||
Investment properties at cost: | $ 3,091,565 | $ 3,087,391 |
Less: accumulated depreciation | (687,592) | (666,952) |
Investment properties, net | 2,403,973 | 2,420,439 |
Cash and cash equivalents | 343,893 | 31,336 |
Tenant and other receivables, including accrued straight-line rent | 49,850 | 55,286 |
Restricted cash and escrow deposits | 21,739 | 21,477 |
Deferred costs, net | 69,520 | 73,157 |
Prepaid and other assets | 36,345 | 34,548 |
Investments in unconsolidated subsidiaries | 12,085 | 12,644 |
Total Assets | 2,937,405 | 2,648,887 |
Liabilities and Equity: | ||
Mortgage and other indebtedness, net | 1,446,488 | 1,146,580 |
Accounts payable and accrued expenses | 109,352 | 69,817 |
Deferred revenue and other liabilities | 83,292 | 90,180 |
Total Liabilities | 1,639,132 | 1,306,577 |
Commitments and contingencies | ||
Limited Partners' interests in Operating Partnership and other | 44,744 | 52,574 |
Shareholders' Equity: | ||
Common shares | 841 | 840 |
Additional paid in capital | 2,081,480 | 2,074,436 |
Accumulated other comprehensive loss | (32,450) | (16,283) |
Accumulated deficit | (797,040) | (769,955) |
Total Shareholders' Equity | 1,252,831 | 1,289,038 |
Noncontrolling Interest | 698 | 698 |
Total Equity | 1,253,529 | 1,289,736 |
Total Liabilities and Shareholders' Equity | 2,937,405 | 2,648,887 |
KRG, LP | ||
Assets: | ||
Investment properties at cost: | 3,091,565 | 3,087,391 |
Less: accumulated depreciation | (687,592) | (666,952) |
Investment properties, net | 2,403,973 | 2,420,439 |
Cash and cash equivalents | 343,893 | 31,336 |
Tenant and other receivables, including accrued straight-line rent | 49,850 | 55,286 |
Restricted cash and escrow deposits | 21,739 | 21,477 |
Deferred costs, net | 69,520 | 73,157 |
Prepaid and other assets | 36,345 | 34,548 |
Investments in unconsolidated subsidiaries | 12,085 | 12,644 |
Total Assets | 2,937,405 | 2,648,887 |
Liabilities and Equity: | ||
Mortgage and other indebtedness, net | 1,446,488 | 1,146,580 |
Accounts payable and accrued expenses | 109,352 | 69,817 |
Deferred revenue and other liabilities | 83,292 | 90,180 |
Total Liabilities | 1,639,132 | 1,306,577 |
Commitments and contingencies | ||
Limited Partners' interests in Operating Partnership and other | 44,744 | 52,574 |
Shareholders' Equity: | ||
Common shares | 1,285,281 | 1,305,321 |
Accumulated other comprehensive loss | (32,450) | (16,283) |
Total Shareholders' Equity | 1,252,831 | 1,289,038 |
Noncontrolling Interest | 698 | 698 |
Total Equity | 1,253,529 | 1,289,736 |
Total Liabilities and Shareholders' Equity | $ 2,937,405 | $ 2,648,887 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parentheticals) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Accrued straight-line rent | $ 25,487 | $ 27,256 |
Common shares, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common shares, shares authorized (in shares) | 225,000,000 | 225,000,000 |
Common shares, shares issued (in shares) | 84,114,704 | 83,963,369 |
Common shares, shares outstanding (in shares) | 84,114,704 | 83,963,369 |
KRG, LP | ||
Accrued straight-line rent | $ 25,487 | $ 27,256 |
Common shares, shares issued (in shares) | 84,114,704 | 83,963,369 |
Common shares, shares outstanding (in shares) | 84,114,704 | 83,963,369 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue: | ||
Rental income | $ 65,527 | $ 82,358 |
Total revenue | 69,912 | 83,515 |
Expenses: | ||
Property operating | 10,801 | 11,431 |
Real estate taxes | 8,934 | 10,206 |
General, administrative, and other | 6,926 | 6,777 |
Depreciation and amortization | 31,468 | 34,635 |
Impairment charges | 0 | 4,077 |
Total expenses | 58,129 | 67,126 |
Gain on sale of operating properties, net | 1,043 | 6,587 |
Operating income | 12,826 | 22,976 |
Interest expense | (12,293) | (16,459) |
Income tax benefit of taxable REIT subsidiary | 104 | 82 |
Equity in loss of unconsolidated subsidiaries | (403) | (427) |
Other expense, net | (104) | (184) |
Net income | 130 | 5,988 |
Net income attributable to noncontrolling interests | (204) | (273) |
Net (loss) income attributable to common shareholders/unitholders | $ (74) | $ 5,715 |
Allocation of net (loss) income: | ||
Net (loss) income per common share - basic & diluted (in USD per share) | $ 0 | $ 0.07 |
Weighted average common shares outstanding - basic (in shares) | 84,023,090 | 83,843,681 |
Weighted average common shares outstanding - diluted (in shares) | 84,023,090 | 84,034,997 |
Dividends declared per common share (in USD per share) | $ 0.3175 | $ 0.3175 |
Change in fair value of derivatives | $ (16,571) | $ (5,057) |
Total comprehensive (loss) income | (16,441) | 931 |
Comprehensive loss (income) attributable to noncontrolling interests | 200 | (146) |
Comprehensive (loss) income attributable to Kite Realty Group Trust | (16,241) | 785 |
KRG, LP | ||
Revenue: | ||
Rental income | 65,527 | 82,358 |
Total revenue | 69,912 | 83,515 |
Expenses: | ||
Property operating | 10,801 | 11,431 |
Real estate taxes | 8,934 | 10,206 |
General, administrative, and other | 6,926 | 6,777 |
Depreciation and amortization | 31,468 | 34,635 |
Impairment charges | 0 | 4,077 |
Total expenses | 58,129 | 67,126 |
Gain on sale of operating properties, net | 1,043 | 6,587 |
Operating income | 12,826 | 22,976 |
Interest expense | (12,293) | (16,459) |
Income tax benefit of taxable REIT subsidiary | 104 | 82 |
Equity in loss of unconsolidated subsidiaries | (403) | (427) |
Other expense, net | (104) | (184) |
Net income | 130 | 5,988 |
Net income attributable to noncontrolling interests | (132) | (132) |
Net (loss) income attributable to common shareholders/unitholders | (2) | 5,856 |
Allocation of net (loss) income: | ||
Limited Partners | 72 | 141 |
Parent Company | $ (74) | $ 5,715 |
Net income attributable to common unitholders (in dollars per share) | $ 0 | $ 0.07 |
Weighted average common shares outstanding - basic (in shares) | 86,200,410 | 85,912,080 |
Weighted average common shares outstanding - diluted (in shares) | 86,200,410 | 86,102,496 |
Dividends declared per common share (in USD per share) | $ 0.3175 | $ 0.3175 |
Change in fair value of derivatives | $ (16,571) | $ (5,057) |
Total comprehensive (loss) income | (16,441) | 931 |
Comprehensive loss (income) attributable to noncontrolling interests | (132) | (132) |
Comprehensive (loss) income attributable to Kite Realty Group Trust | (16,573) | 799 |
Other property related revenue | ||
Revenue: | ||
Total revenue | 4,281 | 1,055 |
Other property related revenue | KRG, LP | ||
Revenue: | ||
Total revenue | 4,281 | 1,055 |
Fee income | ||
Revenue: | ||
Total revenue | 104 | 102 |
Fee income | KRG, LP | ||
Revenue: | ||
Total revenue | $ 104 | $ 102 |
Consolidated Statement of Share
Consolidated Statement of Shareholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Shares | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Beginning balance (in shares) at Dec. 31, 2018 | 83,800,886 | ||||
Beginning balance at Dec. 31, 2018 | $ 1,412,705 | $ 838 | $ 2,078,099 | $ (3,497) | $ (662,735) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock compensation activity (in shares) | 102,022 | ||||
Stock compensation activity | 1,161 | $ 1 | 1,160 | ||
Other comprehensive loss attributable to Kite Realty Group Trust | (4,930) | (4,930) | |||
Distributions declared to common shareholders | (26,672) | (26,672) | |||
Net income/loss attributable to Kite Realty Group Trust | 5,715 | 5,715 | |||
Exchange of redeemable noncontrolling interests for common shares (in shares) | 7,500 | ||||
Exchange of redeemable noncontrolling interests for common shares | 127 | 127 | |||
Adjustment to redeemable noncontrolling interests | (1,282) | (1,282) | |||
Ending balance (in shares) at Mar. 31, 2019 | 83,910,408 | ||||
Ending balance at Mar. 31, 2019 | 1,386,824 | $ 839 | 2,078,104 | (8,427) | (683,692) |
Beginning balance (in shares) at Dec. 31, 2019 | 83,963,369 | ||||
Beginning balance at Dec. 31, 2019 | 1,289,038 | $ 840 | 2,074,436 | (16,283) | (769,955) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock compensation activity (in shares) | 151,335 | ||||
Stock compensation activity | 267 | $ 1 | 266 | ||
Other comprehensive loss attributable to Kite Realty Group Trust | (16,167) | (16,167) | |||
Distributions declared to common shareholders | (27,011) | (27,011) | |||
Net income/loss attributable to Kite Realty Group Trust | (74) | (74) | |||
Adjustment to redeemable noncontrolling interests | 6,778 | 6,778 | |||
Ending balance (in shares) at Mar. 31, 2020 | 84,114,704 | ||||
Ending balance at Mar. 31, 2020 | $ 1,252,831 | $ 841 | $ 2,081,480 | $ (32,450) | $ (797,040) |
Consolidated Statements of Part
Consolidated Statements of Partners' Equity (Unaudited) - KRG, LP - USD ($) $ in Thousands | Total | General PartnerCommon Equity | General PartnerAccumulated Other Comprehensive Loss |
Partners' capital, beginning balance at Dec. 31, 2018 | $ 1,412,705 | $ 1,416,202 | $ (3,497) |
Increase (Decrease) in Partners' Capital [Roll Forward] | |||
Stock compensation activity | 1,161 | 1,161 | |
Other comprehensive loss attributable to Parent Company | (4,930) | (4,930) | |
Distributions declared to Parent Company | (26,672) | (26,672) | |
Net income/loss attributable to Parent Company | 5,715 | 5,715 | |
Conversion of Limited Partner Units to shares of the Parent Company | 127 | ||
Adjustment to redeemable noncontrolling interests | (1,282) | (1,282) | |
Partners' capital, ending balance at Mar. 31, 2019 | 1,386,824 | 1,395,251 | (8,427) |
Partners' capital, beginning balance at Dec. 31, 2019 | 1,289,038 | 1,305,321 | (16,283) |
Increase (Decrease) in Partners' Capital [Roll Forward] | |||
Stock compensation activity | 267 | 267 | |
Other comprehensive loss attributable to Parent Company | (16,167) | (16,167) | |
Distributions declared to Parent Company | (27,011) | (27,011) | |
Net income/loss attributable to Parent Company | (74) | (74) | |
Adjustment to redeemable noncontrolling interests | 6,778 | 6,778 | |
Partners' capital, ending balance at Mar. 31, 2020 | $ 1,252,831 | $ 1,285,281 | $ (32,450) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Consolidated net income | $ 130 | $ 5,988 |
Adjustments to reconcile consolidated net income to net cash provided by operating activities: | ||
Straight-line rent | 2,546 | (663) |
Depreciation and amortization | 32,051 | 35,303 |
Gain on sale of operating properties | (1,043) | (6,587) |
Impairment charge | 0 | 4,077 |
Compensation expense for equity awards | 1,024 | 1,283 |
Amortization of debt fair value adjustment | (111) | (547) |
Amortization of in-place lease liabilities | (598) | (1,045) |
Changes in assets and liabilities: | ||
Tenant receivables | 2,627 | 3,728 |
Deferred costs and other assets | (4,793) | (5,056) |
Accounts payable, accrued expenses, deferred revenue, and other liabilities | (9,960) | (4,171) |
Net cash provided by operating activities | 21,873 | 32,310 |
Cash flow from investing activities: | ||
Acquisitions of interests in properties | 0 | (29,286) |
Capital expenditures | (13,178) | (11,549) |
Net proceeds from sales of land | 5,490 | 0 |
Net proceeds from sales of operating properties | 0 | 13,098 |
Change in construction payables | 594 | (1,963) |
Net cash used in investing activities | (7,094) | (29,700) |
Cash flow from financing activities: | ||
Proceeds from issuance of common shares, net | 21 | 25 |
Repurchases of common shares upon the vesting of restricted shares | (1,002) | (328) |
Loan proceeds | 300,000 | 60,000 |
Loan payments | (549) | (1,159) |
Distributions paid – common shareholders/unitholders | (298) | (53,263) |
Distributions paid – redeemable noncontrolling interests | (132) | (1,441) |
Net cash provided by financing activities | 298,040 | 3,834 |
Net change in cash, cash equivalents, and restricted cash | 312,819 | 6,444 |
Cash, cash equivalents, and restricted cash beginning of period | 52,813 | 45,506 |
Cash, cash equivalents, and restricted cash end of period | 365,632 | 51,950 |
KRG, LP | ||
Cash flows from operating activities: | ||
Consolidated net income | 130 | 5,988 |
Adjustments to reconcile consolidated net income to net cash provided by operating activities: | ||
Straight-line rent | 2,546 | (663) |
Depreciation and amortization | 32,051 | 35,303 |
Gain on sale of operating properties | (1,043) | (6,587) |
Impairment charge | 0 | 4,077 |
Compensation expense for equity awards | 1,024 | 1,283 |
Amortization of debt fair value adjustment | (111) | (547) |
Amortization of in-place lease liabilities | (598) | (1,045) |
Changes in assets and liabilities: | ||
Tenant receivables | 2,627 | 3,728 |
Deferred costs and other assets | (4,793) | (5,056) |
Accounts payable, accrued expenses, deferred revenue, and other liabilities | (9,960) | (4,171) |
Net cash provided by operating activities | 21,873 | 32,310 |
Cash flow from investing activities: | ||
Acquisitions of interests in properties | 0 | (29,286) |
Capital expenditures | (13,178) | (11,549) |
Net proceeds from sales of land | 5,490 | 0 |
Net proceeds from sales of operating properties | 0 | 13,098 |
Change in construction payables | 594 | (1,963) |
Net cash used in investing activities | (7,094) | (29,700) |
Cash flow from financing activities: | ||
Proceeds from issuance of common shares, net | 21 | 25 |
Repurchases of common shares upon the vesting of restricted shares | (1,002) | (328) |
Loan proceeds | 300,000 | 60,000 |
Loan payments | (549) | (1,159) |
Distributions paid – common shareholders/unitholders | (298) | (53,263) |
Distributions paid – redeemable noncontrolling interests | (132) | (1,441) |
Net cash provided by financing activities | 298,040 | 3,834 |
Net change in cash, cash equivalents, and restricted cash | 312,819 | 6,444 |
Cash, cash equivalents, and restricted cash beginning of period | 52,813 | 45,506 |
Cash, cash equivalents, and restricted cash end of period | $ 365,632 | $ 51,950 |
Organization
Organization | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization Kite Realty Group Trust (the "Parent Company"), through its majority-owned subsidiary, Kite Realty Group, L.P. (the “Operating Partnership”), owns interests in various operating subsidiaries and joint ventures engaged in the ownership and operation, acquisition, development and redevelopment of high-quality neighborhood and community shopping centers in select markets in the United States. The terms "Company," "we," "us," and "our" refer to the Parent Company and the Operating Partnership, collectively, and those entities owned or controlled by the Parent Company and/or the Operating Partnership. The Operating Partnership was formed on August 16, 2004, when the Parent Company contributed properties and the net proceeds from an initial public offering of shares of its common stock to the Operating Partnership. The Parent Company was organized in Maryland in 2004 to succeed in the development, acquisition, construction and real estate businesses of its predecessor. We believe the Company qualifies as a real estate investment trust (a “REIT”) under provisions of the Internal Revenue Code of 1986, as amended. The Parent Company is the sole general partner of the Operating Partnership, and as of March 31, 2020 owned approximately 97.4% of the common partnership interests in the Operating Partnership (“General Partner Units”). The remaining 2.6% of the common partnership interests (“Limited Partner Units” and, together with the General Partner Units, the “Common Units”) were owned by the limited partners. As the sole general partner of the Operating Partnership, the Parent Company has full, exclusive and complete responsibility and discretion in the day-to-day management and control of the Operating Partnership. The Parent Company and the Operating Partnership are operated as one enterprise. The management of the Parent Company consists of the same members as the management of the Operating Partnership. As the sole general partner with control of the Operating Partnership, the Parent Company consolidates the Operating Partnership for financial reporting purposes, and the Parent Company does not have any significant assets other than its investment in the Operating Partnership. At March 31, 2020 , we owned interests in 90 operating and redevelopment properties totaling approximately 17.4 million square feet. We also owned one development project under construction as of this date. |
Basis of Presentation, Consolid
Basis of Presentation, Consolidation, Investments in Joint Ventures, and Noncontrolling Interests | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation, Consolidation, Investments in Joint Ventures, and Noncontrolling Interests | Basis of Presentation, Consolidation, Investments in Joint Ventures, and Noncontrolling Interests We have prepared the accompanying unaudited financial statements pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) may have been condensed or omitted pursuant to such rules and regulations, although management believes that the disclosures are adequate to make the presentation not misleading. The unaudited financial statements as of March 31, 2020 and for the three months ended March 31, 2020 and 2019 include all adjustments, consisting of normal recurring adjustments, necessary in the opinion of management to present fairly the financial information set forth therein. The consolidated financial statements in this Form 10-Q should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the combined Annual Report on Form 10-K of the Parent Company and the Operating Partnership for the year ended December 31, 2019 . The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the reported period. Actual results could differ from these estimates. The results of operations for the interim periods are not necessarily indicative of the results that may be expected on an annual basis. Components of Investment Properties The composition of the Company’s investment properties as of March 31, 2020 and December 31, 2019 was as follows: Balance at March 31, December 31, Investment properties, at cost: Land, buildings and improvements $ 3,039,875 $ 3,038,412 Furniture, equipment and other 7,907 7,775 Construction in progress 43,783 41,204 $ 3,091,565 $ 3,087,391 Components of Rental Income including Allowance for Uncollectible Accounts The Company recognized the following lease rental income for the three months ended March 31, 2020 and 2019 : 2020 2019 Fixed Contractual Lease Payments - Operating Leases 55,345 65,539 Variable Lease Payments - Operating Leases 12,102 15,111 Straight-Line Rent Adjustment 358 663 Straight-Line Rent Reserve for Uncollectibility (2,876 ) — Amortization of In-Place Lease Liabilities, net 598 1,045 Total 65,527 82,358 The Company must make estimates as to the collectibility of its accounts receivable. An allowance for uncollectible accounts, including future credit losses of the accrued straight-line rent receivables, is maintained for estimated losses resulting from the inability of certain tenants to meet contractual obligations under their lease agreements. Consolidation and Investments in Joint Ventures The accompanying financial statements are presented on a consolidated basis and include all accounts of the Parent Company, the Operating Partnership, the taxable REIT subsidiary of the Operating Partnership, subsidiaries of the Operating Partnership that are controlled and any variable interest entities (“VIEs”) in which the Operating Partnership is the primary beneficiary. In general, a VIE is a corporation, partnership, trust or any other legal structure used for business purposes that either (a) has equity investors that do not provide sufficient financial resources for the entity to support its activities, (b) does not have equity investors with voting rights or (c) has equity investors whose votes are disproportionate from their economics and substantially all of the activities are conducted on behalf of the investor with disproportionately fewer voting rights. The Operating Partnership accounts for properties that are owned by joint ventures in accordance with the consolidation guidance. The Operating Partnership evaluates each joint venture and determines first whether to follow the VIE or the voting interest entity ("VOE") model. Once the appropriate consolidation model is identified, the Operating Partnership then evaluates whether it should consolidate the joint venture. Under the VIE model, the Operating Partnership consolidates an entity when it has (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, and (ii) the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. Under the VOE model, the Operating Partnership consolidates an entity when (i) it controls the entity through ownership of a majority voting interest if the entity is not a limited partnership or (ii) it controls the entity through its ability to remove the other partners or owners in the entity, at its discretion, when the entity is a limited partnership. In determining whether to consolidate a VIE with the Operating Partnership, we consider all relationships between the Operating Partnership and the applicable VIE, including development agreements, management agreements and other contractual arrangements, in determining whether we have the power to direct the activities of the VIE that most significantly affect the VIE's performance. As of March 31, 2020 , we owned investments in two joint ventures that were VIEs in which the partners did not have substantive participating rights and we were the primary beneficiary. As of this date, these VIEs had total debt of $55.7 million , which were secured by assets of the VIEs totaling $114.8 million . The Operating Partnership guarantees the debts of these VIEs. The Operating Partnership is considered a VIE as the limited partners do not hold kick-out rights or substantive participating rights. The Parent Company consolidates the Operating Partnership as it is the primary beneficiary in accordance with the VIE model. Income Taxes and REIT Compliance Parent Company The Parent Company, which is considered a corporation for federal income tax purposes, has been organized and intends to continue to operate in a manner that will enable it to maintain its qualification as a REIT for federal income tax purposes. As a result, it generally will not be subject to federal income tax on the earnings that it distributes to the extent it distributes its “REIT taxable income” (determined before the deduction for dividends paid and excluding net capital gains) to shareholders of the Parent Company and meets certain other requirements on a recurring basis. To the extent that it satisfies this distribution requirement, but distributes less than 100% of its taxable income, it will be subject to federal corporate income tax on its undistributed REIT taxable income. REITs are subject to a number of organizational and operational requirements. If the Parent Company fails to qualify as a REIT in any taxable year, it will be subject to federal income tax on its taxable income at regular corporate rates for a period of four years following the year in which qualification is lost. We may also be subject to certain federal, state and local taxes on our income and property and to federal income and excise taxes on our undistributed taxable income even if the Parent Company does qualify as a REIT. The Operating Partnership intends to continue to make distributions to the Parent Company in amounts sufficient to assist the Parent Company in adhering to REIT requirements and maintaining its REIT status. We have elected to treat Kite Realty Holdings, LLC as a taxable REIT subsidiary of the Operating Partnership, and we may elect to treat other subsidiaries as taxable REIT subsidiaries in the future. This election enables us to receive income and provide services that would otherwise be impermissible for a REIT. Deferred tax assets and liabilities are established for temporary differences between the financial reporting bases and the tax bases of assets and liabilities at the tax rates expected to be in effect when the temporary differences reverse. Deferred tax assets are reduced by a valuation allowance if it is more likely than not that some portion or all of the deferred tax asset will not be realized. Operating Partnership The allocated share of income and loss, other than the operations of our taxable REIT subsidiary, is included in the income tax returns of the Operating Partnership's partners. Accordingly, the only federal income taxes included in the accompanying consolidated financial statements are in connection with the Operating Partnership's taxable REIT subsidiary. Noncontrolling Interests We report the non-redeemable noncontrolling interests in subsidiaries as equity, and the amount of consolidated net income attributable to these noncontrolling interests is set forth separately in the consolidated financial statements. The non-redeemable noncontrolling interests in consolidated properties for the three months ended March 31, 2020 and 2019 were as follows: 2020 2019 Noncontrolling interests balance January 1 $ 698 $ 698 Net income allocable to noncontrolling interests, — — Noncontrolling interests balance at March 31 $ 698 $ 698 Redeemable Noncontrolling Interests - Limited Partners Limited Partner Units are redeemable noncontrolling interests in the Operating Partnership. We classify redeemable noncontrolling interests in the Operating Partnership in the accompanying consolidated balance sheets outside of permanent equity because we may be required to pay cash to holders of Limited Partner Units upon redemption of their interests in the Operating Partnership or deliver registered shares upon their conversion. The carrying amount of the redeemable noncontrolling interests in the Operating Partnership is reflected at the greater of historical book value or redemption value with a corresponding adjustment to additional paid-in capital. At March 31, 2020 , the redemption value of the redeemable noncontrolling interests did not exceed the historical book value, and the balance was accordingly adjusted to historical book value. At December 31, 2019 , the redemption value of the redeemable noncontrolling interests exceeded the historical book value, and the balance was accordingly adjusted to redemption value. We allocate net operating results of the Operating Partnership after noncontrolling interests in the consolidated properties based on the partners’ respective weighted average ownership interest. We adjust the redeemable noncontrolling interests in the Operating Partnership at the end of each reporting period to reflect their interests in the Operating Partnership or redemption value. This adjustment is reflected in our shareholders’ and Parent Company's equity. For the three months ended March 31, 2020 and 2019 , the weighted average interests of the Parent Company and the limited partners in the Operating Partnership were as follows: Three Months Ended March 31, 2020 2019 Parent Company’s weighted average interest in Operating Partnership 97.5 % 97.6 % Limited partners' weighted average interests in Operating Partnership 2.5 % 2.4 % At March 31, 2020 , the Parent Company's interest and the limited partners' redeemable noncontrolling ownership interests in the Operating Partnership were 97.4% and 2.6% . At December 31, 2019 , the Parent Company's interest and the limited partners' redeemable noncontrolling ownership interests in the Operating Partnership were 97.5% and 2.5% . Concurrent with the Parent Company’s initial public offering and related formation transactions, certain individuals received Limited Partner Units of the Operating Partnership in exchange for their interests in certain properties. The limited partners have the right to redeem Limited Partner Units for cash or, at the Parent Company's election, common shares of the Parent Company in an amount equal to the market value of an equivalent number of common shares of the Parent Company at the time of redemption. Such common shares must be registered, which is not fully in the Parent Company’s control. Therefore, the limited partners’ interest is not reflected in permanent equity. The Parent Company also has the right to redeem the Limited Partner Units directly from the limited partner in exchange for either cash in the amount specified above or a number of its common shares equal to the number of Limited Partner Units being redeemed. There were 2,234,991 and 2,110,037 Limited Partner Units outstanding as of March 31, 2020 and December 31, 2019 , respectively. The increase in Limited Partner Units outstanding from December 31, 2019 is due to non-cash compensation awards made to our executive officers in the form of Limited Partner Units. Redeemable Noncontrolling Interests - Subsidiaries Prior to the merger with Inland Diversified Real Estate Trust, Inc. ("Inland Diversified") in 2014, Inland Diversified formed joint ventures with the previous owners of certain properties and issued Class B units in three joint ventures that indirectly own those properties. The Class B units related to one of these three joint ventures remain outstanding and are accounted for as noncontrolling interests in the remaining venture. The remaining Class B units will become redeemable at the respective partner's election in October 2022 and the fulfillment of certain redemption criteria. Beginning in November 2022, the Class B units can be redeemed at the election of either of our partner or us for cash or Limited Partner Units in the Operating Partnership. The Class B units do not have a maturity date, and none are mandatorily redeemable unless either party has elected for the units to be redeemed. We consolidate this joint venture because we control the decision making and our joint venture partner has limited protective rights. We classify the redeemable noncontrolling interests in certain subsidiaries in the accompanying consolidated balance sheets outside of permanent equity because, under certain circumstances, we may be required to pay cash to Class B unitholders in specific subsidiaries upon redemption of their interests. The carrying amount of these redeemable noncontrolling interests is required to be reflected at the greater of initial book value or redemption value with a corresponding adjustment to additional paid-in capital. As of March 31, 2020 and December 31, 2019 , the redemption amounts of these interests did not exceed their fair value, nor did they exceed the initial book value. The redeemable noncontrolling interests in the Operating Partnership and subsidiaries for the three months ended March 31, 2020 and 2019 were as follows: 2020 2019 Redeemable noncontrolling interests balance January 1 $ 52,574 $ 45,743 Net income allocable to redeemable noncontrolling interests 204 273 Distributions declared to redeemable noncontrolling interests (842 ) (795 ) Other, net including adjustments to redemption value (7,192 ) 1,077 Total limited partners' interests in Operating Partnership and other redeemable noncontrolling interests balance at March 31 $ 44,744 $ 46,298 Limited partners' interests in Operating Partnership $ 34,674 $ 36,228 Other redeemable noncontrolling interests in certain subsidiaries 10,070 10,070 Total limited partners' interests in Operating Partnership and other redeemable noncontrolling interests balance at March 31 $ 44,744 $ 46,298 Fair Value Measurements We follow the framework established under accounting standard FASB ASC 820 for measuring fair value of non-financial assets and liabilities that are not required or permitted to be measured at fair value on a recurring basis but only in certain circumstances, such as a business combination or upon determination of an impairment. Assets and liabilities recorded at fair value on the consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows: • Level 1 fair value inputs are quoted prices in active markets for identical instruments to which we have access. • Level 2 fair value inputs are inputs other than quoted prices included in Level 1 that are observable for similar instruments, either directly or indirectly, and appropriately consider counterparty creditworthiness in the valuations. • Level 3 fair value inputs reflect our best estimate of inputs and assumptions market participants would use in pricing an instrument at the measurement date. The inputs are unobservable in the market and significant to the valuation estimate. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Recently Issued Accounting Pronouncements Adoption of New Standards In the first quarter of 2020, the Financial Accounting Standards Board issued ASU 2020-04, Reference Rate Reform (Topic 848) . ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. During the first quarter of 2020, the Company has elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur. On January 1, 2020, we adopted ASU 2016-13, "Financial Instruments - Credit Losses," which introduced new guidance for an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modified the impairment model for available-for-sale debt securities and provides a simplified accounting model for purchased financial assets with credit deterioration since their origination. Instruments in scope include loans, held-to-maturity debt securities, and net investments in leases as well as reinsurance and trade receivables. In November 2018, the FASB issued ASU 2018-19, which clarifies that operating lease receivables are outside the scope of the new standard. The adoption of this standard did not have a material impact on the Company's consolidated financial statements. In April 2020, the FASB issued a question-and-answer document focused on the application of lease accounting guidance to lease concessions provided as a result of COVID-19. Under Topic 842, Leases , the Company would have to evaluate, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant or if a lease concession was under the enforceable rights and obligation within the existing lease agreement. The FASB clarified that entities may elect to not evaluate whether lease-related relief that lessors provide to mitigate the economic effects of COVID-19 is a lease modification. The Company is evaluating its election on a disaggregated basis, with such election applied consistently to leases with similar characteristics and similar circumstances. The future impact is dependent upon the extent of lease concessions granted to tenants as a result of COVID-19 in future periods and the elections made by the Company at the time of entering into such concessions. There were no lease concessions granted as a result of COVID-19 during the first quarter. |
Earnings Per Share or Unit
Earnings Per Share or Unit | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share or Unit | Earnings Per Share or Unit Basic earnings per share or unit is calculated based on the weighted average number of common shares or units outstanding during the period. Diluted earnings per share or unit is determined based on the weighted average common number of shares or units outstanding during the period combined with the incremental average common shares or units that would have been outstanding assuming the conversion of all potentially dilutive common shares or units into common shares or units as of the earliest date possible. Potentially dilutive securities include outstanding options to acquire common shares; Limited Partner Units, which may be exchanged for either cash or common shares, at the Parent Company’s option and under certain circumstances; and deferred common share units, which may be credited to the personal accounts of non-employee trustees in lieu of the payment of cash compensation or the issuance of common shares to such trustees. Limited Partner Units have been omitted from the Parent Company’s denominator for the purpose of computing diluted earnings per share since the effect of including these amounts in the denominator would have no dilutive impact. Weighted average Limited Partner Units outstanding for the three months ended March 31, 2020 and 2019 were 2.2 million and 2.1 million , respectively. Less than 0.1 million outstanding options to acquire common shares were excluded from the computations of diluted earnings per share or unit for the three months ended March 31, 2019 because their impact was not dilutive. Due to the net loss allocable to common shareholders and Common Unit holders for the three months ended March 31, 2020, no |
Mortgage and Other Indebtedness
Mortgage and Other Indebtedness | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Mortgage and Other Indebtedness | Mortgage and Other Indebtedness Mortgage and other indebtedness consisted of the following as of March 31, 2020 and December 31, 2019 : As of March 31, 2020 Principal Unamortized Net Premiums Unamortized Debt Issuance Costs Total Senior unsecured notes—fixed rate $ 550,000 $ — $ (4,031 ) $ 545,969 Unsecured revolving credit facility 300,000 — (2,329 ) 297,671 Unsecured term loan 250,000 — (1,806 ) 248,194 Mortgage notes payable—fixed rate 297,103 2,065 (38 ) 299,130 Mortgage note payable—variable rate 55,650 — (126 ) 55,524 Total mortgage and other indebtedness $ 1,452,753 $ 2,065 $ (8,330 ) $ 1,446,488 As of December 31, 2019 Principal Unamortized Net Premiums Unamortized Debt Issuance Costs Total Senior unsecured notes - fixed rate $ 550,000 $ — $ (4,231 ) $ 545,769 Unsecured revolving credit facility — — (2,625 ) (2,625 ) Unsecured term loans 250,000 — (1,859 ) 248,141 Mortgage notes payable - fixed rate 297,472 2,176 (40 ) 299,608 Mortgage notes payable - variable rate 55,830 — (143 ) 55,687 Total mortgage and other indebtedness $ 1,153,302 $ 2,176 $ (8,898 ) $ 1,146,580 Consolidated indebtedness, including weighted average maturities and weighted average interest rates as of March 31, 2020 , considering the impact of interest rate swaps, is summarized below: Outstanding Amount Ratio Weighted Average Weighted Average Fixed Rate Debt 1 $ 1,097,103 75 % 3.79 % 4.9 Variable Rate Debt 355,650 25 % 2.53 % 5.2 Net Debt Premiums and Issuance Costs, Net (6,265 ) N/A N/A N/A Total $ 1,446,488 100 % 3.49 % 5.0 ____________________ 1 Fixed rate debt includes, and variable rate date excludes, the portion of such debt that has been hedged by interest rate derivatives. As of March 31, 2020, $250 million in variable rate debt is hedged for a weighted average of 5.2 years. Mortgage indebtedness is collateralized by certain real estate properties and leases, and is generally due in monthly installments of interest and principal and matures over various terms through 2030. Variable interest rates on mortgage indebtedness is based on LIBOR plus 160 basis points. At March 31, 2020 , the one-month LIBOR interest rate was 0.99% . Fixed interest rates on mortgage indebtedness range from 3.78% to 5.73% . Debt Issuance Costs Debt issuance costs are amortized on a straight-line basis over the terms of the respective loan agreements. The accompanying consolidated statements of operations include amortization of debt issuance costs as a component of interest expense as follows: Three Months Ended March 31, 2020 2019 Amortization of debt issuance costs $ 582 $ 669 Unsecured Revolving Credit Facility and Unsecured Term Loans As of March 31, 2020 , we had an unsecured revolving credit facility (the "Credit Facility") with a total commitment of $600 million that matures in April 2023 (inclusive of one twelve -month extension option). The Operating Partnership has the option to increase the borrowing availability of the Credit Facility to $1.2 billion , subject to certain conditions, including obtaining commitments from lenders. On October 25, 2018, the Operating Partnership entered into a Term Loan Agreement (the “Agreement”) with KeyBank National Association, as Administrative Agent (the “Agent”), and the other lenders party thereto, providing for an unsecured term loan facility of up to $250 million (the “Term Loan”). The Term Loan ranks pari passu with the Operating Partnership’s existing $600 million unsecured revolving credit facility documented in the Operating Partnership’s Fifth Amended and Restated Credit Agreement, dated as of July 28, 2016, as amended (the “Existing Credit Agreement”), and other unsecured indebtedness of the Operating Partnership. The Term Loan has a scheduled maturity date of October 24, 2025, which maturity date may be extended for up to three additional periods of one year at the Operating Partnership’s option subject to certain conditions. The Operating Partnership has the option to increase the Term Loan to $300 million , subject to certain conditions, including obtaining commitments from any one or more lenders, whether or not currently party to the Agreement, to provide such increased amounts. The Operating Partnership is permitted to prepay the Term Loan in whole or in part, at any time, subject to a prepayment fee if prepaid on or before October 25, 2023. In March 2020, we borrowed $300 million on the Credit Facility as a precautionary measure in order to increase our cash position and preserve financial flexibility in light of current uncertainty in the global markets resulting from the COVID-19 pandemic. Proceeds from the Credit Facility borrowings may in the future be used for working capital, general corporate or other purposes permitted under the Credit Facility. As of March 31, 2020 , there was $300 million outstanding under the Credit Facility. Additionally, we had letters of credit outstanding which totaled $1.2 million , against which no amounts were advanced as of March 31, 2020 . The amount that we may borrow under our Credit Facility is limited by the value of the assets in our unencumbered asset pool. As of March 31, 2020 , the value of the assets in our unencumbered asset pool, calculated pursuant to the Credit Facility agreement, was $1.4 billion . Considering outstanding borrowings on the line of credit, term loans, unsecured notes and letters of credit, we had $281.5 million available under our Credit Facility for future borrowings as of March 31, 2020 . Our ability to borrow under the Credit Facility is subject to our compliance with various restrictive and financial covenants, including with respect to liens, indebtedness, investments, dividends, mergers and asset sales. As of March 31, 2020 , we were in compliance with all such covenants. Senior Unsecured Notes The Operating Partnership has $550 million of senior unsecured notes maturing at various dates through September 2027 (the "Notes"). The Notes contain a number of customary financial and restrictive covenants. As of March 31, 2020 , we were in compliance with all such covenants. Fair Value of Fixed and Variable Rate Debt As of March 31, 2020 , the estimated fair value of our fixed rate debt was $839.9 million compared to the book value of $874.1 million . The fair value was estimated using Level 2 and 3 inputs with cash flows discounted at current borrowing rates for similar instruments, which ranged from 3.47% to 3.95% . As of March 31, 2020 , the fair value of variable rate debt was $587.0 million compared to the book value of $605.7 million . The fair value was estimated using Level 2 and 3 inputs with cash flows discounted at current borrowing rates for similar instruments, which ranged from 1.43% to 3.83% . |
Derivative Instruments, Hedging
Derivative Instruments, Hedging Activities and Other Comprehensive Income | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments, Hedging Activities and Other Comprehensive Income | Derivative Instruments, Hedging Activities and Other Comprehensive Income In order to manage potential future variable interest rate risk, we enter into interest rate derivative agreements from time to time. All such agreements are designated as cash flow hedges. We do not use interest rate derivative agreements for trading or speculative purposes. The agreements with each of our derivative counterparties provide that, in the event of default on any of our indebtedness, we could also be declared in default on our derivative obligations. As of March 31, 2020 , we were party to various cash flow derivative agreements with notional amounts totaling $250.0 million . These derivative agreements effectively fix the interest rate underlying certain variable rate debt instruments over expiration dates through 2025 . Utilizing a weighted average interest rate spread over LIBOR on all variable rate debt resulted in fixing the weighted average interest rate at 3.74% . These interest rate derivative agreements are the only assets or liabilities that we record at fair value on a recurring basis. The valuation of these assets and liabilities is determined using widely accepted techniques including discounted cash flow analysis. These techniques consider the contractual terms of the derivatives (including the period to maturity) and use observable market-based inputs such as interest rate curves and implied volatilities. We also incorporate credit valuation adjustments into the fair value measurements to reflect nonperformance risk on both our part and that of the respective counterparties. We determined that the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, although the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by us and our counterparties. As of March 31, 2020 and December 31, 2019 , we assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and determined the credit valuation adjustments were not significant to the overall valuation of our derivatives. As a result, we determined our derivative valuations were classified within Level 2 of the fair value hierarchy. As of March 31, 2020 , the estimated fair value of our interest rate derivatives represented a net liability of $33.4 million , including accrued interest payable of $0.1 million . As of March 31, 2020 , this was reflected in accounts payable and accrued expenses on the accompanying consolidated balance sheets. At December 31, 2019 , the estimated fair value of our interest rate hedges was a liability of $16.8 million , including accrued interest of $0.1 million . As of December 31, 2019 , this was reflected in accounts payable and accrued expenses on the accompanying consolidated balance sheets. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to earnings over time as the hedged items are recognized in earnings. Approximately $0.3 million was reclassified as a decrease to earnings during the three months ended March 31, 2020 , and $0.5 million was reclassified as an increase to earnings during the three months ended March 31, 2019 . As the interest payments on our hedges are made over the next 12 months, we estimate the increase to interest expense to be $5.4 million , assuming the current LIBOR curve. |
Shareholders' Equity
Shareholders' Equity | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Distribution Payments Our Board of Trustees declared a cash distribution of $0.3175 for the first quarter of 2020 to common shareholders and Common Unit holders of record as of March 27, 2020. The distribution was paid on April 3, 2020. AO LTIP Units In connection with its annual review of executive compensation and as described in the table below, the Compensation Committee of the Company's Board of Trustees approved an aggregate grant of AO LTIP Units (the “awards”) to the Company’s executive officers under an amendment and restatement of the Company’s 2013 Equity Incentive Plan. Executive Number of AO LTIP Units Participation Threshold per AO LTIP Unit John A. Kite 1,729,729 $ 17.76 Thomas K. McGowan 405,405 $ 17.76 Heath R. Fear 275,675 $ 17.76 Scott E. Murray 202,702 $ 17.76 The Company entered into an award agreement with each executive officer with respect to his awards, which provides terms of vesting, conversion, distribution, and other terms. AO LTIP Units are designed to have economics similar to stock options and allow the recipient, subject to vesting requirements, to realize value above a threshold level set as of the grant date of the award (the “Participation Threshold”). The value of vested AO LTIP Units is realized through conversion into a number of vested LTIP Units in the Operating Partnership determined on the basis of how much the value of a common share of the Company has increased over the Participation Threshold. The AO LTIP Units are only exercisable and convertible into vested LTIP Units of the Operating Partnership to the extent that they become vested AO LTIP Units. The awards of AO LTIP Units are subject to both time-based and stock price performance-based vesting requirements. Subject to the terms of the award agreement, the AO LTIP Units shall vest and become fully exercisable as of the date that both of the following requirements have been met: (i) the grantee remains in continuous service from the grant date through the third anniversary of the grant date; and (ii) at any time during the period beginning in the second year and ending at the end of the fifth year following the grant date, the reported closing price per common share of the Company appreciates at least 15% over the applicable Participation Threshold per AO LTIP Unit (as set forth in the table above) for a minimum of 20 consecutive trading days. Any AO LTIP Units that do not become vested will be forfeited and become null and void as of the fifth anniversary of the grant date, but AO LTIP Units may also be forfeited earlier in connection with a corporate transaction or with the holder’s termination of service. The AO LTIP Units were valued using a Monte Carlo simulation, and the resulting total compensation expense of $3.9 million is being amortized over five years . |
Deferred Costs and Intangibles,
Deferred Costs and Intangibles, net | 3 Months Ended |
Mar. 31, 2020 | |
Deferred Costs [Abstract] | |
Deferred Costs and Intangibles, net | Deferred Costs and Intangibles, net Deferred costs consist primarily of acquired lease intangible assets, broker fees and capitalized commissions incurred in connection with lease originations. Deferred leasing costs, lease intangibles and similar costs are amortized on a straight-line basis over the terms of the related leases. At March 31, 2020 and December 31, 2019 , deferred costs consisted of the following: March 31, December 31, Acquired lease intangible assets $ 59,137 $ 60,862 Deferred leasing costs and other 60,372 62,109 119,509 122,971 Less—accumulated amortization (49,989 ) (49,814 ) Total $ 69,520 $ 73,157 Amortization of deferred leasing costs, leasing intangibles and other is included in depreciation and amortization expense in the accompanying consolidated statements of operations. The amortization of above market lease intangibles is included as a reduction to revenue. The amounts of such amortization included in the accompanying consolidated statements of operations are as follows: Three Months Ended March 31, 2020 2019 Amortization of deferred leasing costs, lease intangibles and other $ 4,065 $ 3,694 Amortization of above market lease intangibles 242 399 |
Deferred Revenue, Intangibles,
Deferred Revenue, Intangibles, Net and Other Liabilities | 3 Months Ended |
Mar. 31, 2020 | |
Other Liabilities Disclosure [Abstract] | |
Deferred Revenue, Intangibles, Net and Other Liabilities | Deferred Revenue, Intangibles, Net and Other Liabilities Deferred revenue and other liabilities consist of the unamortized fair value of below market lease liabilities recorded in connection with purchase accounting, retainage payables for development and redevelopment projects, and tenant rent payments received in advance of the month in which they are due. The amortization of below market lease liabilities is recognized as revenue over the remaining life of the leases (including option periods for leases with below market renewal options) through 2046. Tenant rent payments received in advance are recognized as revenue in the period to which they apply, which is typically the month following their receipt. At March 31, 2020 and December 31, 2019 , deferred revenue, intangibles, net and other liabilities consisted of the following: March 31, December 31, Unamortized in-place lease liabilities $ 49,232 $ 50,072 Retainages payable and other 2,581 2,254 Tenant rents received in advance 4,585 10,839 Lease liabilities 26,894 27,015 Total $ 83,292 $ 90,180 The amortization of below market lease intangibles is included as a component of minimum rent in the accompanying consolidated statements and was $0.8 million and $1.4 million for the three months ended March 31, 2020 and 2019 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Other Commitments and Contingencies We are not subject to any material litigation nor, to management’s knowledge, is any material litigation currently threatened against us. We are parties to routine litigation, claims, and administrative proceedings arising in the ordinary course of business. Management believes that such matters will not have a material adverse impact on our consolidated financial condition, results of operations or cash flows taken as a whole. We are obligated under various completion guarantees with certain lenders and lease agreements with tenants to complete all or portions of a development and tenant-specific space currently under construction. We believe we currently have sufficient financing in place to fund these projects and expect to do so primarily through borrowings on the Credit Facility. In connection with the joint venture that owns the Embassy Suites at Notre Dame, we provided a repayment guaranty on a $33.8 million construction loan, of which our share is $11.8 million (reflecting our 35% ownership interest in the hotel project). The outstanding loan balance as of March 31, 2020 is $33.6 million and our share is $11.8 million . As of March 31, 2020 , we had outstanding letters of credit totaling $1.2 million . At that date, there were no amounts advanced against these instruments. |
Disposals of Operating Properti
Disposals of Operating Properties and Impairment Charge | 3 Months Ended |
Mar. 31, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposals of Operating Properties and Impairment Charge | Disposals of Operating Properties and Impairment Charge During the three months ended March 31, 2020 , we resolved a contingency related to an asset sold prior to 2020 and recorded a net gain of $1.0 million . During the three months ended March 31, 2019, we sold our Whitehall Pike operating property in Bloomington, Indiana for aggregate gross proceeds of $13.5 million and a net gain of $6.6 million . As of March 31, 2019, in connection with the preparation and review of the financial statements, we evaluated an operating property for impairment and recorded a $4.1 million impairment charge due to changes in our estimate of the fair value for a property in which we had previously concluded that undiscounted cash flows were insufficient to recover the carrying value. We estimated the fair value of the property to be $10.0 million using the market approach by utilizing a recent sales offer without adjustment. We compared the estimated fair value to the carrying value, which resulted in the recording of a non-cash impairment charge of $4.1 million for the three months ended March 31, 2019. This property was sold in May 2019. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Impact of COVID-19 Since first being reported in December 2019, the novel strain of coronavirus (COVID-19) has spread globally, including to every state in the United States. In March 2020, the World Health Organization declared COVID-19 a pandemic, and subsequently, the United States declared a national emergency with respect to COVID-19. The Company is closely monitoring the impact of the COVID-19 pandemic on all aspects of its business and how it may impact the Company's tenants and business partners. While the Company incurred only limited disruptions during the three months ended March 31, 2020 from the COVID-19 pandemic, the Company experienced significant disruption in April 2020, and, going forward the potential adverse effect of the COVID-19 on the financial condition, results of operations, cash flows and performance of the Company and its tenants, the real estate market and the global economy and financial markets, and the extent of such effects, will depend on the future developments, which are highly uncertain and cannot be predicted with confidence. The following operating trends, combined with macroeconomic trends such as a global economic slowdown or recession, reduced consumer spending and increased unemployment, lead us to believe that our operating results for the next few quarters of 2020 will be more adversely affected by COVID-19 than our results for the quarter ended March 31, 2020: • Based on weekly property visits, almost half of the retailers in our portfolio (based on ABR) were closed for at least some portion of April 2020. Many of the remaining tenants were operating only in a limited capacity. Store closures, particularly if for an extended period, increase the risk of business failures and lease defaults. • As of May 7, 2020, we have collected approximately 67% of April rent billings, which does not include the application of any security deposits that we are holding. • Many of our tenants have taken on additional debt as a result of COVID-19, including loans administered by the Small Business Administration. To the extent this debt is not forgiven, the increased debt load may hamper their ability to continue to operate and to pay rent, which could cause the Company to realize decreased cash flow and increased vacancies at its properties In March and April 2020, the Company received rent relief requests from a significant proportion of its tenants. Some tenants have asserted various legal arguments that they allege relieve them of the obligation to pay rent during the pandemic; the Company and its legal advisers generally disagree with these legal arguments. The Company has evaluated and will continue to evaluate tenant requests for rent relief based on many factors, including the tenant's financial strength, the tenant's operating history, potential co-tenancy impacts, the tenant's contribution to the shopping center in which it operates, the Company's assessment of the tenant's long-term viability, the difficulty or ease with which the tenant could be replaced, and other factors. As a result of this evaluation, the Company has agreed to defer rent for many of its tenants, primarily small-shop tenants, subject to certain conditions. To the extent the Company agrees to defer rent or is otherwise unable to collect rent for certain periods, the Company will realize decreased cash flow, which could significantly decrease the cash available for the Company's operating and capital uses. |
Basis of Presentation, Consol_2
Basis of Presentation, Consolidation, Investments in Joint Ventures, and Noncontrolling Interests (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidation and Investments in Joint Ventures | Consolidation and Investments in Joint Ventures The accompanying financial statements are presented on a consolidated basis and include all accounts of the Parent Company, the Operating Partnership, the taxable REIT subsidiary of the Operating Partnership, subsidiaries of the Operating Partnership that are controlled and any variable interest entities (“VIEs”) in which the Operating Partnership is the primary beneficiary. In general, a VIE is a corporation, partnership, trust or any other legal structure used for business purposes that either (a) has equity investors that do not provide sufficient financial resources for the entity to support its activities, (b) does not have equity investors with voting rights or (c) has equity investors whose votes are disproportionate from their economics and substantially all of the activities are conducted on behalf of the investor with disproportionately fewer voting rights. The Operating Partnership accounts for properties that are owned by joint ventures in accordance with the consolidation guidance. The Operating Partnership evaluates each joint venture and determines first whether to follow the VIE or the voting interest entity ("VOE") model. Once the appropriate consolidation model is identified, the Operating Partnership then evaluates whether it should consolidate the joint venture. Under the VIE model, the Operating Partnership consolidates an entity when it has (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, and (ii) the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. Under the VOE model, the Operating Partnership consolidates an entity when (i) it controls the entity through ownership of a majority voting interest if the entity is not a limited partnership or (ii) it controls the entity through its ability to remove the other partners or owners in the entity, at its discretion, when the entity is a limited partnership. In determining whether to consolidate a VIE with the Operating Partnership, we consider all relationships between the Operating Partnership and the applicable VIE, including development agreements, management agreements and other contractual arrangements, in determining whether we have the power to direct the activities of the VIE that most significantly affect the VIE's performance. As of March 31, 2020 , we owned investments in two joint ventures that were VIEs in which the partners did not have substantive participating rights and we were the primary beneficiary. As of this date, these VIEs had total debt of $55.7 million , which were secured by assets of the VIEs totaling $114.8 million . The Operating Partnership guarantees the debts of these VIEs. The Operating Partnership is considered a VIE as the limited partners do not hold kick-out rights or substantive participating rights. The Parent Company consolidates the Operating Partnership as it is the primary beneficiary in accordance with the VIE model. |
Income Taxes and REIT Compliance | Income Taxes and REIT Compliance Parent Company The Parent Company, which is considered a corporation for federal income tax purposes, has been organized and intends to continue to operate in a manner that will enable it to maintain its qualification as a REIT for federal income tax purposes. As a result, it generally will not be subject to federal income tax on the earnings that it distributes to the extent it distributes its “REIT taxable income” (determined before the deduction for dividends paid and excluding net capital gains) to shareholders of the Parent Company and meets certain other requirements on a recurring basis. To the extent that it satisfies this distribution requirement, but distributes less than 100% of its taxable income, it will be subject to federal corporate income tax on its undistributed REIT taxable income. REITs are subject to a number of organizational and operational requirements. If the Parent Company fails to qualify as a REIT in any taxable year, it will be subject to federal income tax on its taxable income at regular corporate rates for a period of four years following the year in which qualification is lost. We may also be subject to certain federal, state and local taxes on our income and property and to federal income and excise taxes on our undistributed taxable income even if the Parent Company does qualify as a REIT. The Operating Partnership intends to continue to make distributions to the Parent Company in amounts sufficient to assist the Parent Company in adhering to REIT requirements and maintaining its REIT status. We have elected to treat Kite Realty Holdings, LLC as a taxable REIT subsidiary of the Operating Partnership, and we may elect to treat other subsidiaries as taxable REIT subsidiaries in the future. This election enables us to receive income and provide services that would otherwise be impermissible for a REIT. Deferred tax assets and liabilities are established for temporary differences between the financial reporting bases and the tax bases of assets and liabilities at the tax rates expected to be in effect when the temporary differences reverse. Deferred tax assets are reduced by a valuation allowance if it is more likely than not that some portion or all of the deferred tax asset will not be realized. Operating Partnership The allocated share of income and loss, other than the operations of our taxable REIT subsidiary, is included in the income tax returns of the Operating Partnership's partners. Accordingly, the only federal income taxes included in the accompanying consolidated financial statements are in connection with the Operating Partnership's taxable REIT subsidiary. |
Noncontrolling Interests | Noncontrolling Interests We report the non-redeemable noncontrolling interests in subsidiaries as equity, and the amount of consolidated net income attributable to these noncontrolling interests is set forth separately in the consolidated financial statements. The non-redeemable noncontrolling interests in consolidated properties for the three months ended March 31, 2020 and 2019 were as follows: 2020 2019 Noncontrolling interests balance January 1 $ 698 $ 698 Net income allocable to noncontrolling interests, — — Noncontrolling interests balance at March 31 $ 698 $ 698 Redeemable Noncontrolling Interests - Limited Partners Limited Partner Units are redeemable noncontrolling interests in the Operating Partnership. We classify redeemable noncontrolling interests in the Operating Partnership in the accompanying consolidated balance sheets outside of permanent equity because we may be required to pay cash to holders of Limited Partner Units upon redemption of their interests in the Operating Partnership or deliver registered shares upon their conversion. The carrying amount of the redeemable noncontrolling interests in the Operating Partnership is reflected at the greater of historical book value or redemption value with a corresponding adjustment to additional paid-in capital. At March 31, 2020 , the redemption value of the redeemable noncontrolling interests did not exceed the historical book value, and the balance was accordingly adjusted to historical book value. At December 31, 2019 , the redemption value of the redeemable noncontrolling interests exceeded the historical book value, and the balance was accordingly adjusted to redemption value. We allocate net operating results of the Operating Partnership after noncontrolling interests in the consolidated properties based on the partners’ respective weighted average ownership interest. We adjust the redeemable noncontrolling interests in the Operating Partnership at the end of each reporting period to reflect their interests in the Operating Partnership or redemption value. This adjustment is reflected in our shareholders’ and Parent Company's equity. For the three months ended March 31, 2020 and 2019 , the weighted average interests of the Parent Company and the limited partners in the Operating Partnership were as follows: Three Months Ended March 31, 2020 2019 Parent Company’s weighted average interest in Operating Partnership 97.5 % 97.6 % Limited partners' weighted average interests in Operating Partnership 2.5 % 2.4 % At March 31, 2020 , the Parent Company's interest and the limited partners' redeemable noncontrolling ownership interests in the Operating Partnership were 97.4% and 2.6% . At December 31, 2019 , the Parent Company's interest and the limited partners' redeemable noncontrolling ownership interests in the Operating Partnership were 97.5% and 2.5% . Concurrent with the Parent Company’s initial public offering and related formation transactions, certain individuals received Limited Partner Units of the Operating Partnership in exchange for their interests in certain properties. The limited partners have the right to redeem Limited Partner Units for cash or, at the Parent Company's election, common shares of the Parent Company in an amount equal to the market value of an equivalent number of common shares of the Parent Company at the time of redemption. Such common shares must be registered, which is not fully in the Parent Company’s control. Therefore, the limited partners’ interest is not reflected in permanent equity. The Parent Company also has the right to redeem the Limited Partner Units directly from the limited partner in exchange for either cash in the amount specified above or a number of its common shares equal to the number of Limited Partner Units being redeemed. There were 2,234,991 and 2,110,037 Limited Partner Units outstanding as of March 31, 2020 and December 31, 2019 , respectively. The increase in Limited Partner Units outstanding from December 31, 2019 is due to non-cash compensation awards made to our executive officers in the form of Limited Partner Units. Redeemable Noncontrolling Interests - Subsidiaries Prior to the merger with Inland Diversified Real Estate Trust, Inc. ("Inland Diversified") in 2014, Inland Diversified formed joint ventures with the previous owners of certain properties and issued Class B units in three joint ventures that indirectly own those properties. The Class B units related to one of these three joint ventures remain outstanding and are accounted for as noncontrolling interests in the remaining venture. The remaining Class B units will become redeemable at the respective partner's election in October 2022 and the fulfillment of certain redemption criteria. Beginning in November 2022, the Class B units can be redeemed at the election of either of our partner or us for cash or Limited Partner Units in the Operating Partnership. The Class B units do not have a maturity date, and none are mandatorily redeemable unless either party has elected for the units to be redeemed. We consolidate this joint venture because we control the decision making and our joint venture partner has limited protective rights. |
Fair Value Measurements | Fair Value Measurements We follow the framework established under accounting standard FASB ASC 820 for measuring fair value of non-financial assets and liabilities that are not required or permitted to be measured at fair value on a recurring basis but only in certain circumstances, such as a business combination or upon determination of an impairment. Assets and liabilities recorded at fair value on the consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows: • Level 1 fair value inputs are quoted prices in active markets for identical instruments to which we have access. • Level 2 fair value inputs are inputs other than quoted prices included in Level 1 that are observable for similar instruments, either directly or indirectly, and appropriately consider counterparty creditworthiness in the valuations. • Level 3 fair value inputs reflect our best estimate of inputs and assumptions market participants would use in pricing an instrument at the measurement date. The inputs are unobservable in the market and significant to the valuation estimate. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements Adoption of New Standards In the first quarter of 2020, the Financial Accounting Standards Board issued ASU 2020-04, Reference Rate Reform (Topic 848) . ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. During the first quarter of 2020, the Company has elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur. On January 1, 2020, we adopted ASU 2016-13, "Financial Instruments - Credit Losses," which introduced new guidance for an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modified the impairment model for available-for-sale debt securities and provides a simplified accounting model for purchased financial assets with credit deterioration since their origination. Instruments in scope include loans, held-to-maturity debt securities, and net investments in leases as well as reinsurance and trade receivables. In November 2018, the FASB issued ASU 2018-19, which clarifies that operating lease receivables are outside the scope of the new standard. The adoption of this standard did not have a material impact on the Company's consolidated financial statements. In April 2020, the FASB issued a question-and-answer document focused on the application of lease accounting guidance to lease concessions provided as a result of COVID-19. Under Topic 842, Leases , the Company would have to evaluate, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant or if a lease concession was under the enforceable rights and obligation within the existing lease agreement. The FASB clarified that entities may elect to not evaluate whether lease-related relief that lessors provide to mitigate the economic effects of COVID-19 is a lease modification. The Company is evaluating its election on a disaggregated basis, with such election applied consistently to leases with similar characteristics and similar circumstances. The future impact is dependent upon the extent of lease concessions granted to tenants as a result of COVID-19 in future periods and the elections made by the Company at the time of entering into such concessions. There were no lease concessions granted as a result of COVID-19 during the first quarter. |
Basis of Presentation, Consol_3
Basis of Presentation, Consolidation, Investments in Joint Ventures, and Noncontrolling Interests (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Real Estate Properties | The composition of the Company’s investment properties as of March 31, 2020 and December 31, 2019 was as follows: Balance at March 31, December 31, Investment properties, at cost: Land, buildings and improvements $ 3,039,875 $ 3,038,412 Furniture, equipment and other 7,907 7,775 Construction in progress 43,783 41,204 $ 3,091,565 $ 3,087,391 |
Lessor, Schedule Of Lease Rental Income | The Company recognized the following lease rental income for the three months ended March 31, 2020 and 2019 : 2020 2019 Fixed Contractual Lease Payments - Operating Leases 55,345 65,539 Variable Lease Payments - Operating Leases 12,102 15,111 Straight-Line Rent Adjustment 358 663 Straight-Line Rent Reserve for Uncollectibility (2,876 ) — Amortization of In-Place Lease Liabilities, net 598 1,045 Total 65,527 82,358 |
Schedule of Stockholders Equity | The non-redeemable noncontrolling interests in consolidated properties for the three months ended March 31, 2020 and 2019 were as follows: 2020 2019 Noncontrolling interests balance January 1 $ 698 $ 698 Net income allocable to noncontrolling interests, — — Noncontrolling interests balance at March 31 $ 698 $ 698 |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net | For the three months ended March 31, 2020 and 2019 , the weighted average interests of the Parent Company and the limited partners in the Operating Partnership were as follows: Three Months Ended March 31, 2020 2019 Parent Company’s weighted average interest in Operating Partnership 97.5 % 97.6 % Limited partners' weighted average interests in Operating Partnership 2.5 % 2.4 % |
Redeemable Noncontrolling Interest | The redeemable noncontrolling interests in the Operating Partnership and subsidiaries for the three months ended March 31, 2020 and 2019 were as follows: 2020 2019 Redeemable noncontrolling interests balance January 1 $ 52,574 $ 45,743 Net income allocable to redeemable noncontrolling interests 204 273 Distributions declared to redeemable noncontrolling interests (842 ) (795 ) Other, net including adjustments to redemption value (7,192 ) 1,077 Total limited partners' interests in Operating Partnership and other redeemable noncontrolling interests balance at March 31 $ 44,744 $ 46,298 Limited partners' interests in Operating Partnership $ 34,674 $ 36,228 Other redeemable noncontrolling interests in certain subsidiaries 10,070 10,070 Total limited partners' interests in Operating Partnership and other redeemable noncontrolling interests balance at March 31 $ 44,744 $ 46,298 |
Mortgage and Other Indebtedne_2
Mortgage and Other Indebtedness (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Participating Mortgage Loans | Mortgage and other indebtedness consisted of the following as of March 31, 2020 and December 31, 2019 : As of March 31, 2020 Principal Unamortized Net Premiums Unamortized Debt Issuance Costs Total Senior unsecured notes—fixed rate $ 550,000 $ — $ (4,031 ) $ 545,969 Unsecured revolving credit facility 300,000 — (2,329 ) 297,671 Unsecured term loan 250,000 — (1,806 ) 248,194 Mortgage notes payable—fixed rate 297,103 2,065 (38 ) 299,130 Mortgage note payable—variable rate 55,650 — (126 ) 55,524 Total mortgage and other indebtedness $ 1,452,753 $ 2,065 $ (8,330 ) $ 1,446,488 As of December 31, 2019 Principal Unamortized Net Premiums Unamortized Debt Issuance Costs Total Senior unsecured notes - fixed rate $ 550,000 $ — $ (4,231 ) $ 545,769 Unsecured revolving credit facility — — (2,625 ) (2,625 ) Unsecured term loans 250,000 — (1,859 ) 248,141 Mortgage notes payable - fixed rate 297,472 2,176 (40 ) 299,608 Mortgage notes payable - variable rate 55,830 — (143 ) 55,687 Total mortgage and other indebtedness $ 1,153,302 $ 2,176 $ (8,898 ) $ 1,146,580 |
Schedule of Debt | Consolidated indebtedness, including weighted average maturities and weighted average interest rates as of March 31, 2020 , considering the impact of interest rate swaps, is summarized below: Outstanding Amount Ratio Weighted Average Weighted Average Fixed Rate Debt 1 $ 1,097,103 75 % 3.79 % 4.9 Variable Rate Debt 355,650 25 % 2.53 % 5.2 Net Debt Premiums and Issuance Costs, Net (6,265 ) N/A N/A N/A Total $ 1,446,488 100 % 3.49 % 5.0 ____________________ 1 Fixed rate debt includes, and variable rate date excludes, the portion of such debt that has been hedged by interest rate derivatives. As of March 31, 2020, $250 million in variable rate debt is hedged for a weighted average of 5.2 years. |
Deferred Cost Amortization | The accompanying consolidated statements of operations include amortization of debt issuance costs as a component of interest expense as follows: Three Months Ended March 31, 2020 2019 Amortization of debt issuance costs $ 582 $ 669 Three Months Ended March 31, 2020 2019 Amortization of deferred leasing costs, lease intangibles and other $ 4,065 $ 3,694 Amortization of above market lease intangibles 242 399 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Share-based Compensation, Activity | In connection with its annual review of executive compensation and as described in the table below, the Compensation Committee of the Company's Board of Trustees approved an aggregate grant of AO LTIP Units (the “awards”) to the Company’s executive officers under an amendment and restatement of the Company’s 2013 Equity Incentive Plan. Executive Number of AO LTIP Units Participation Threshold per AO LTIP Unit John A. Kite 1,729,729 $ 17.76 Thomas K. McGowan 405,405 $ 17.76 Heath R. Fear 275,675 $ 17.76 Scott E. Murray 202,702 $ 17.76 |
Deferred Costs and Intangible_2
Deferred Costs and Intangibles, net (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Deferred Costs [Abstract] | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure | At March 31, 2020 and December 31, 2019 , deferred costs consisted of the following: March 31, December 31, Acquired lease intangible assets $ 59,137 $ 60,862 Deferred leasing costs and other 60,372 62,109 119,509 122,971 Less—accumulated amortization (49,989 ) (49,814 ) Total $ 69,520 $ 73,157 |
Deferred Cost Amortization | The accompanying consolidated statements of operations include amortization of debt issuance costs as a component of interest expense as follows: Three Months Ended March 31, 2020 2019 Amortization of debt issuance costs $ 582 $ 669 Three Months Ended March 31, 2020 2019 Amortization of deferred leasing costs, lease intangibles and other $ 4,065 $ 3,694 Amortization of above market lease intangibles 242 399 |
Deferred Revenue, Intangibles_2
Deferred Revenue, Intangibles, Net and Other Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities | At March 31, 2020 and December 31, 2019 , deferred revenue, intangibles, net and other liabilities consisted of the following: March 31, December 31, Unamortized in-place lease liabilities $ 49,232 $ 50,072 Retainages payable and other 2,581 2,254 Tenant rents received in advance 4,585 10,839 Lease liabilities 26,894 27,015 Total $ 83,292 $ 90,180 |
Organization (Details)
Organization (Details) ft² in Millions | 3 Months Ended |
Mar. 31, 2020ft²property | |
Organization [Line Items] | |
Area of real estate property | ft² | 17.4 |
Operating and Redevelopment Properties | |
Organization [Line Items] | |
Number of real estate properties (in properties) | 90 |
Under Construction Retail Development Project | |
Organization [Line Items] | |
Number of real estate properties (in properties) | 1 |
General Partner Units | |
Organization [Line Items] | |
Ownership interest of General Partner (as percent) | 97.40% |
KRG, LP | |
Organization [Line Items] | |
Ownership interest of Common Partner (as percent) | 2.60% |
Basis of Presentation, Consol_4
Basis of Presentation, Consolidation, Investments in Joint Ventures, and Noncontrolling Interests - Investment Properties (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Land, buildings and improvements | $ 3,039,875 | $ 3,038,412 |
Furniture, equipment and other | 7,907 | 7,775 |
Construction in progress | 43,783 | 41,204 |
Investment properties, at cost | $ 3,091,565 | $ 3,087,391 |
Basis of Presentation, Consol_5
Basis of Presentation, Consolidation, Investments in Joint Ventures, and Noncontrolling Interests - Additional Information (Details) $ in Thousands | Mar. 31, 2020USD ($)joint_ventureshares | Dec. 31, 2019USD ($)shares |
Noncontrolling Interest [Line Items] | ||
Variable interest entity, number of entities | joint_venture | 2 | |
Variable interest entity, consolidated, carrying amount, liabilities | $ 1,639,132 | $ 1,306,577 |
Variable interest entity, consolidated, carrying amount, assets | $ 2,937,405 | $ 2,648,887 |
Limited partners' capital account, units outstanding (in shares) | shares | 2,234,991 | 2,110,037 |
Variable Interest Entity, Primary Beneficiary | ||
Noncontrolling Interest [Line Items] | ||
Variable interest entity, consolidated, carrying amount, liabilities | $ 55,700 | |
Variable interest entity, consolidated, carrying amount, assets | $ 114,800 | |
Operating Partnership | ||
Noncontrolling Interest [Line Items] | ||
Noncontrolling interest, ownership percentage by parent (as percent) | 97.40% | 97.50% |
Noncontrolling interest, ownership percentage by noncontrolling owners (as percent) | 2.60% | 2.50% |
Basis of Presentation, Consol_6
Basis of Presentation, Consolidation, Investments in Joint Ventures, and Noncontrolling Interests - Leases - Lessor (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Fixed Contractual Lease Payments - Operating Leases | $ 55,345 | $ 65,539 |
Variable Lease Payments - Operating Leases | 12,102 | 15,111 |
Straight-Line Rent Adjustment | 358 | 663 |
Straight-Line Rent Reserve for Uncollectibility | (2,876) | 0 |
Amortization of In-Place Lease Liabilities, net | 598 | 1,045 |
Total | $ 65,527 | $ 82,358 |
Basis of Presentation, Consol_7
Basis of Presentation, Consolidation, Investments in Joint Ventures, and Noncontrolling Interests - Noncontrolling Interests (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||
Beginning Balance | $ 698 | $ 698 |
Net income allocable to noncontrolling interests, excluding redeemable noncontrolling interests | 204 | 273 |
Ending Balance | 698 | 698 |
Excluding Redeemable Non-Controlling Interests | ||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||
Net income allocable to noncontrolling interests, excluding redeemable noncontrolling interests | $ 0 | $ 0 |
Basis of Presentation, Consol_8
Basis of Presentation, Consolidation, Investments in Joint Ventures, and Noncontrolling Interests - Weighted Average Interests in Operating Partnership (Details) - Operating Partnership | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||
Parent Company’s weighted average interest in Operating Partnership | 97.50% | 97.60% |
Limited partners' weighted average interests in Operating Partnership | 2.50% | 2.40% |
Basis of Presentation, Consol_9
Basis of Presentation, Consolidation, Investments in Joint Ventures, and Noncontrolling Interests - Redeemable Noncontrolling Interests (Details) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2020USD ($)joint_venture | Mar. 31, 2019USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Redeemable Noncontrolling Interest, Equity, Carrying Amount [Roll Forward] | ||||
Net income allocable to redeemable noncontrolling interests | $ 204 | $ 273 | ||
Redeemable Noncontrolling Interests | ||||
Redeemable Noncontrolling Interest, Equity, Carrying Amount [Roll Forward] | ||||
Beginning Balance | 52,574 | 45,743 | ||
Net income allocable to redeemable noncontrolling interests | 204 | 273 | ||
Distributions declared to redeemable noncontrolling interests | (842) | (795) | ||
Other, net including adjustments to redemption value | (7,192) | 1,077 | ||
Ending Balance | 44,744 | 46,298 | ||
Total limited partners' interests in Operating Partnership and other redeemable noncontrolling interests balance at March 31 | 44,744 | $ 46,298 | $ 44,744 | $ 52,574 |
Redeemable Noncontrolling Interests | Partnership Interest | ||||
Redeemable Noncontrolling Interest, Equity, Carrying Amount [Roll Forward] | ||||
Beginning Balance | 46,298 | |||
Ending Balance | 44,744 | |||
Limited partners' interests in Operating Partnership | 34,674 | 36,228 | ||
Other redeemable noncontrolling interests in certain subsidiaries | 10,070 | 10,070 | ||
Total limited partners' interests in Operating Partnership and other redeemable noncontrolling interests balance at March 31 | $ 46,298 | $ 44,744 | $ 46,298 | |
Capital Unit, Class B | ||||
Redeemable Noncontrolling Interest [Line Items] | ||||
Number of joint ventures | joint_venture | 3 | |||
Number of joint ventures accounted for as noncontrolling interest | joint_venture | 1 |
Earnings Per Share or Unit (Det
Earnings Per Share or Unit (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share [Abstract] | ||
Weighted average limited partner units outstanding, basic (in shares) | 2,200,000 | 2,100,000 |
Antidilutive securities excluded from computation of earnings per share (in shares) | 100,000 | |
Dilutive impact (in shares) | 0 |
Mortgage and Other Indebtedne_3
Mortgage and Other Indebtedness - Consolidated Indebtedness by Type of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Participating Mortgage Loans [Line Items] | ||
Principal | $ 1,452,753 | $ 1,153,302 |
Unamortized Net Premiums | 2,065 | 2,176 |
Unamortized Debt Issuance Costs | (8,330) | (8,898) |
Total | 1,446,488 | 1,146,580 |
Revolving credit facility | ||
Participating Mortgage Loans [Line Items] | ||
Principal | 300,000 | 0 |
Unamortized Net Premiums | 0 | 0 |
Unamortized Debt Issuance Costs | (2,329) | (2,625) |
Total | 297,671 | (2,625) |
Senior unsecured notes | Fixed rate debt | ||
Participating Mortgage Loans [Line Items] | ||
Principal | 550,000 | 550,000 |
Unamortized Net Premiums | 0 | 0 |
Unamortized Debt Issuance Costs | (4,031) | (4,231) |
Total | 545,969 | 545,769 |
Unsecured term loan | ||
Participating Mortgage Loans [Line Items] | ||
Principal | 250,000 | 250,000 |
Unamortized Net Premiums | 0 | 0 |
Unamortized Debt Issuance Costs | (1,806) | (1,859) |
Total | 248,194 | 248,141 |
Mortgages notes payable | Fixed rate debt | ||
Participating Mortgage Loans [Line Items] | ||
Principal | 297,103 | 297,472 |
Unamortized Net Premiums | 2,065 | 2,176 |
Unamortized Debt Issuance Costs | (38) | (40) |
Total | 299,130 | 299,608 |
Mortgages notes payable | Variable rate debt | ||
Participating Mortgage Loans [Line Items] | ||
Principal | 55,650 | 55,830 |
Unamortized Net Premiums | 0 | 0 |
Unamortized Debt Issuance Costs | (126) | (143) |
Total | $ 55,524 | $ 55,687 |
Mortgage and Other Indebtedne_4
Mortgage and Other Indebtedness - Consolidated Indebtedness by Type of Interest Rate (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | ||
Amount | $ 1,446,488 | $ 1,146,580 |
Ratio (as percent) | 100.00% | |
Weighted Average Interest Rate (as percent) | 3.49% | |
Weighted Average Maturity (Years) | 5 years | |
Net Debt Premiums and Issuance Costs, Net | $ (6,265) | |
Fixed rate debt | ||
Debt Instrument [Line Items] | ||
Amount | $ 1,097,103 | |
Ratio (as percent) | 75.00% | |
Weighted Average Interest Rate (as percent) | 3.79% | |
Weighted Average Maturity (Years) | 4 years 10 months 24 days | |
Variable rate debt | ||
Debt Instrument [Line Items] | ||
Amount | $ 355,650 | |
Ratio (as percent) | 25.00% | |
Weighted Average Interest Rate (as percent) | 2.53% | |
Weighted Average Maturity (Years) | 5 years 2 months 12 days | |
Floating Rate Debt Hedged | Variable rate debt | ||
Debt Instrument [Line Items] | ||
Amount | $ 250,000 | |
Weighted Average Maturity (Years) | 5 years 2 months 12 days |
Mortgage and Other Indebtedne_5
Mortgage and Other Indebtedness - Additional Information (Details) | Mar. 31, 2020USD ($) | Oct. 25, 2018USD ($)extension | Mar. 31, 2020USD ($)extension | Mar. 31, 2019USD ($) | Dec. 31, 2019USD ($) | Apr. 24, 2018USD ($) |
Debt Instrument [Line Items] | ||||||
Amortization of debt issuance costs | $ 582,000 | $ 669,000 | ||||
Long-term debt | $ 1,446,488,000 | 1,446,488,000 | $ 1,146,580,000 | |||
Letters of credit outstanding, amount | 1,200,000 | 1,200,000 | ||||
Letters of credit outstanding, amount advanced | 0 | 0 | ||||
Value in unencumbered asset pool | 1,400,000,000 | 1,400,000,000 | ||||
Percentage bearing fixed interest, amount | 874,100,000 | 874,100,000 | ||||
Repayments of long-term debt | 549,000 | 1,159,000 | ||||
Percentage bearing variable interest, amount | 605,700,000 | 605,700,000 | ||||
Three Fixed-Rate Secured Loans | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, fair value | 839,900,000 | 839,900,000 | ||||
Variable rate debt | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, fair value | 587,000,000 | 587,000,000 | ||||
Senior unsecured notes | ||||||
Debt Instrument [Line Items] | ||||||
Percentage bearing fixed interest, amount | 550,000,000 | 550,000,000 | ||||
Senior unsecured notes | Fixed rate debt | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | 545,969,000 | 545,969,000 | 545,769,000 | |||
Revolving credit facility | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit facility, maximum borrowing capacity | 600,000,000 | $ 600,000,000 | ||||
Debt instrument, maturity date, number of extensions | extension | 1 | |||||
Debt instrument, maturity date, extension | 12 months | |||||
Long-term debt | 297,671,000 | $ 297,671,000 | (2,625,000) | |||
Line of credit facility, option to increase maximum borrowing capacity | 1,200,000,000 | 1,200,000,000 | ||||
Long-term line of credit | 300,000,000 | 300,000,000 | ||||
Line of credit facility, remaining borrowing capacity | $ 281,500,000 | 281,500,000 | ||||
Loan proceeds | $ 300,000,000 | |||||
London Interbank Offered Rate (LIBOR) | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate (as percent) | 0.99% | |||||
Minimum | Three Fixed-Rate Secured Loans | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate (as percent) | 3.78% | 3.78% | ||||
Percentage bearing fixed interest (as percent) | 3.47% | 3.47% | ||||
Minimum | Variable rate debt | ||||||
Debt Instrument [Line Items] | ||||||
Percentage bearing variable interest (as percent) | 1.43% | 1.43% | ||||
Maximum | Three Fixed-Rate Secured Loans | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate (as percent) | 5.73% | 5.73% | ||||
Percentage bearing fixed interest (as percent) | 3.95% | 3.95% | ||||
Maximum | Variable rate debt | ||||||
Debt Instrument [Line Items] | ||||||
Percentage bearing variable interest (as percent) | 3.83% | 3.83% | ||||
Maximum | London Interbank Offered Rate (LIBOR) | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate (as percent) | 160.00% | |||||
KRG, LP | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 1,446,488,000 | $ 1,446,488,000 | $ 1,146,580,000 | |||
Repayments of long-term debt | $ 549,000 | $ 1,159,000 | ||||
KRG, LP | Revolving credit facility | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit facility, maximum borrowing capacity | $ 600,000,000 | |||||
KRG, LP | Unsecured term loan | Term Loan Due October 2025 | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit facility, maximum borrowing capacity | $ 250,000,000 | |||||
Debt instrument, maturity date, number of extensions | extension | 3 | |||||
Debt instrument, maturity date, extension | 1 year | |||||
Line of credit facility, option to increase maximum borrowing capacity | $ 300,000,000 |
Derivative Instruments, Hedgi_2
Derivative Instruments, Hedging Activities and Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative, average cap interest rate (as percent) | 3.74% | ||
Hedge derivative at fair value, net | $ 33,400 | $ 16,800 | |
Gain (loss) reclassified to earnings | 300 | $ 500 | |
Interest expense | 12,293 | $ 16,459 | |
Decrease As Hedged Forecasted Interest Payments Occur | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Interest expense | 5,400 | ||
Accrued Interest | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Hedge derivative at fair value, net | 100 | $ 100 | |
Cash Flow Hedging | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative, notional amount | $ 250,000 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Millions | Mar. 27, 2020 | Mar. 31, 2020 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common dividends, cash paid (USD per share) | $ 0.3175 | |
AO LTIP Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Minimum appreciation threshold for vesting | 15.00% | |
Consecutive trading days for appreciation threshold | 20 days | |
Allocated share-based compensation expense | $ 3.9 | |
Share based compensation expense, amortization period | 5 years | |
2013 Equity Incentive Plan | John A. Kite | AO LTIP Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of AO LTIP Units (in units) | 1,729,729 | |
Participation threshold per AO LTIP unit (in dollars per unit) | $ 17.76 | |
2013 Equity Incentive Plan | Thomas K. McGowan | AO LTIP Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of AO LTIP Units (in units) | 405,405 | |
Participation threshold per AO LTIP unit (in dollars per unit) | $ 17.76 | |
2013 Equity Incentive Plan | Heath R. Fear | AO LTIP Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of AO LTIP Units (in units) | 275,675 | |
Participation threshold per AO LTIP unit (in dollars per unit) | $ 17.76 | |
2013 Equity Incentive Plan | Scott E. Murray | AO LTIP Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of AO LTIP Units (in units) | 202,702 | |
Participation threshold per AO LTIP unit (in dollars per unit) | $ 17.76 | |
Minimum | AO LTIP Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 2 years | |
Maximum | AO LTIP Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 5 years |
Deferred Costs and Intangible_3
Deferred Costs and Intangibles, net - Deferred Costs (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Deferred Costs [Abstract] | ||
Acquired lease intangible assets | $ 59,137 | $ 60,862 |
Deferred leasing costs and other | 60,372 | 62,109 |
Deferred costs and intangibles, gross | 119,509 | 122,971 |
Less—accumulated amortization | (49,989) | (49,814) |
Total | $ 69,520 | $ 73,157 |
Deferred Costs and Intangible_4
Deferred Costs and Intangibles, net - Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Deferred Costs [Abstract] | ||
Amortization of deferred leasing costs, lease intangibles and other | $ 4,065 | $ 3,694 |
Amortization of above market lease intangibles | $ 242 | $ 399 |
Deferred Revenue, Intangibles_3
Deferred Revenue, Intangibles, Net and Other Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Other Liabilities Disclosure [Abstract] | |||
Unamortized in-place lease liabilities | $ 49,232 | $ 50,072 | |
Retainages payable and other | 2,581 | 2,254 | |
Tenant rents received in advance | 4,585 | 10,839 | |
Lease liabilities | 26,894 | 27,015 | |
Total | 83,292 | $ 90,180 | |
Amortization of below market lease intangibles | $ 800 | $ 1,400 |
Commitments and Contingencies
Commitments and Contingencies - Additional Information (Details) | Mar. 31, 2020USD ($) |
Guarantor Obligations [Line Items] | |
Letters of credit outstanding, amount | $ 1,200,000 |
Amount advanced | 0 |
Construction Loan | Repayment Guarantee | |
Guarantor Obligations [Line Items] | |
Amount of obligation remaining | 11,800,000 |
Co-venturer | |
Guarantor Obligations [Line Items] | |
Outstanding balance of construction loan | 33,600,000 |
Co-venturer | Construction Loan | |
Guarantor Obligations [Line Items] | |
Amount of debt issued | $ 33,800,000 |
Embassy Suites Joint Venture | |
Guarantor Obligations [Line Items] | |
Ownership percentage | 35.00% |
Embassy Suites Joint Venture | Construction Loan | Repayment Guarantee | |
Guarantor Obligations [Line Items] | |
Amount of exposure from obligation | $ 11,800,000 |
Disposals of Operating Proper_2
Disposals of Operating Properties and Impairment Charge (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Gain on sale of operating properties, net | $ 1,043 | $ 6,587 |
Impairment charges | $ 0 | 4,077 |
Unnamed impaired property | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Impairment charges | 4,100 | |
Whitehall Pike | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Proceeds from sales of operating properties | 13,500 | |
Disposal group, not discontinued operation, gain (loss) on disposal | 6,600 | |
Fair Value, Inputs, Level 3 | Unnamed impaired property | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Real estate property, fair value disclosure | $ 10,000 |
Subsequent Events (Details)
Subsequent Events (Details) | May 07, 2020 |
Subsequent Event | |
Subsequent Event [Line Items] | |
April rent billings collected (as a percent) | 67.00% |