Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Nov. 03, 2017 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | Douglas Emmett Inc | |
Entity Central Index Key | 1,364,250 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 169,525,292 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Investment in real estate: | ||
Land | $ 1,055,604 | $ 1,022,340 |
Buildings and improvements | 7,735,718 | 7,221,124 |
Tenant improvements and lease intangibles | 737,606 | 696,197 |
Property under development | 106,891 | 58,459 |
Investment in real estate, gross | 9,635,819 | 8,998,120 |
Less: accumulated depreciation and amortization | (1,959,448) | (1,789,678) |
Investment in real estate, net | 7,676,371 | 7,208,442 |
Cash and cash equivalents | 167,742 | 112,927 |
Tenant receivables, net | 2,856 | 2,165 |
Deferred rent receivables, net | 102,178 | 93,165 |
Acquired lease intangible assets, net | 4,616 | 5,147 |
Interest rate contract assets | 37,115 | 35,656 |
Investment in unconsolidated real estate funds | 105,016 | 144,289 |
Other assets | 17,278 | 11,914 |
Total Assets | 8,113,172 | 7,613,705 |
Liabilities | ||
Secured notes payable and revolving credit facility, net | 4,048,828 | 4,369,537 |
Interest payable, accounts payable and deferred revenue | 118,363 | 75,229 |
Security deposits | 48,799 | 45,990 |
Acquired lease intangible liabilities, net | 69,114 | 67,191 |
Interest rate contract liabilities | 2,002 | 6,830 |
Dividends payable | 38,989 | 34,857 |
Total liabilities | 4,326,095 | 4,599,634 |
Douglas Emmett, Inc. stockholders' equity: | ||
Common Stock, $0.01 par value, 750,000,000 authorized, 169,487,292 and 151,530,210 outstanding at September 30, 2017 and December 31, 2016, respectively | 1,695 | 1,515 |
Additional paid-in capital | 3,278,642 | 2,725,157 |
Accumulated other comprehensive income | 22,539 | 15,156 |
Accumulated deficit | (866,954) | (820,685) |
Total Douglas Emmett, Inc. stockholders' equity | 2,435,922 | 1,921,143 |
Noncontrolling interests | 1,351,155 | 1,092,928 |
Total equity | 3,787,077 | 3,014,071 |
Total Liabilities and Equity | $ 8,113,172 | $ 7,613,705 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Common Stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common Stock, shares authorized (in shares) | 750,000,000 | 750,000,000 |
Common Stock, shares outstanding (in shares) | 169,487,292 | 151,530,210 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Office rental | ||||
Rental revenues | $ 140,993 | $ 128,744 | $ 409,674 | $ 366,400 |
Tenant recoveries | 15,854 | 12,914 | 39,705 | 34,111 |
Parking and other income | 27,771 | 25,950 | 81,129 | 74,572 |
Total office revenues | 184,618 | 167,608 | 530,508 | 475,083 |
Multifamily rental | ||||
Rental revenues | 22,282 | 22,801 | 66,760 | 67,634 |
Parking and other income | 1,849 | 1,712 | 5,594 | 5,191 |
Total multifamily revenues | 24,131 | 24,513 | 72,354 | 72,825 |
Total revenues | 208,749 | 192,121 | 602,862 | 547,908 |
Operating Expenses | ||||
Office expenses | 62,468 | 56,926 | 175,240 | 158,190 |
Multifamily expenses | 6,041 | 5,950 | 17,866 | 17,322 |
General and administrative | 8,441 | 8,099 | 27,189 | 25,573 |
Depreciation and amortization | 69,974 | 63,827 | 206,141 | 181,947 |
Total operating expenses | 146,924 | 134,802 | 426,436 | 383,032 |
Operating income | 61,825 | 57,319 | 176,426 | 164,876 |
Other income | 2,659 | 2,295 | 7,152 | 6,527 |
Other expenses | (1,659) | (2,916) | (5,156) | (7,828) |
Income, including depreciation, from unconsolidated real estate funds | 1,137 | 2,334 | 4,427 | 5,564 |
Interest expense | (35,454) | (36,479) | (110,408) | (109,842) |
Income before gains | 28,508 | 22,553 | 72,441 | 59,297 |
Gains on sales of investments in real estate | 0 | 13,245 | 0 | 14,327 |
Net income | 28,508 | 35,798 | 72,441 | 73,624 |
Less: Net income attributable to noncontrolling interests | (2,894) | (3,950) | (7,534) | (7,928) |
Net income attributable to common stockholders | $ 25,614 | $ 31,848 | $ 64,907 | $ 65,696 |
Net income attributable to common stockholders per share – basic (usd per share) | $ 0.154 | $ 0.210 | $ 0.409 | $ 0.440 |
Net income attributable to common stockholders per share – diluted (usd per share) | 0.154 | 0.206 | 0.408 | 0.428 |
Dividends declared per common share (usd per share) | $ 0.23 | $ 0.22 | $ 0.69 | $ 0.66 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 28,508 | $ 35,798 | $ 72,441 | $ 73,624 |
Other comprehensive income (loss): cash flow hedges | 1,493 | 18,429 | 7,129 | (17,069) |
Comprehensive income | 30,001 | 54,227 | 79,570 | 56,555 |
Less: Comprehensive income attributable to noncontrolling interests | (2,719) | (9,048) | (7,280) | (5,235) |
Comprehensive income attributable to common stockholders | $ 27,282 | $ 45,179 | $ 72,290 | $ 51,320 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Operating Activities | ||
Net income | $ 72,441 | $ 73,624 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Income, including depreciation, from unconsolidated real estate funds | (4,427) | (5,564) |
Gains on sales of investments in real estate | 0 | (14,327) |
Depreciation and amortization | 206,141 | 181,947 |
Net accretion of acquired lease intangibles | (13,290) | (13,415) |
Straight-line rent | (9,012) | (10,915) |
Bad debt expense | 139 | 1,190 |
Amortization of deferred loan costs | 6,865 | 5,470 |
Non-cash market value adjustments on interest rate contracts | 38 | 0 |
Amortization of stock-based compensation | 7,910 | 7,077 |
Operating distributions from unconsolidated real estate funds | 4,427 | 1,356 |
Change in working capital components: | ||
Tenant receivables | (830) | (1,451) |
Interest payable, accounts payable and deferred revenue | 40,110 | 37,389 |
Security deposits | 2,809 | 7,461 |
Other assets | (4,639) | (4,179) |
Net cash provided by operating activities | 308,682 | 265,663 |
Investing Activities | ||
Capital expenditures for improvements to real estate | (80,102) | (57,771) |
Capital expenditures for developments | (42,143) | (18,635) |
Property acquisitions | (532,324) | (1,619,760) |
Proceeds from sale of investments in real estate, net | 0 | 348,203 |
Loan payments received from related parties | 0 | 763 |
Acquisitions of additional interests in unconsolidated real estate funds | (2,571) | 0 |
Capital distributions from unconsolidated real estate funds | 41,965 | 21,973 |
Net cash used in investing activities | (615,175) | (1,325,227) |
Financing Activities | ||
Proceeds from borrowings | 1,010,500 | 1,589,500 |
Repayment of borrowings | (1,330,945) | (786,156) |
Loan cost payments | (7,173) | (18,239) |
Contributions from noncontrolling interests in consolidated JVs | 284,248 | 459,750 |
Distributions paid to noncontrolling interests | (28,682) | (26,185) |
Dividends paid to common stockholders | (107,045) | (97,575) |
Taxes paid on exercise of stock options | (52,867) | (53,467) |
Repurchase of OP Units | 0 | (826) |
Proceeds from issuance of common stock, net | 593,272 | 49,379 |
Net cash provided by financing activities | 361,308 | 1,116,181 |
Increase in cash and cash equivalents | 54,815 | 56,617 |
Cash and cash equivalents at the beginning of the year | 112,927 | 101,798 |
Cash and cash equivalents at quarter end | 167,742 | 158,415 |
Supplemental Cash Flows Information | ||
Cash paid for interest, net of capitalized interest | 103,305 | 104,205 |
Capitalized interest paid | 1,906 | 793 |
Non-cash Investing Transactions | ||
Accrual increase for capital expenditures for improvements to real estate and developments | 3,024 | 68 |
Capitalized stock-based compensation for improvements to real estate and developments | 732 | 683 |
Removal of fully depreciated and amortized tenant improvements and lease intangibles | 36,367 | 13,746 |
Removal of fully amortized acquired lease intangible assets | 85 | 1,241 |
Removal of fully accreted acquired lease intangible liabilities | 4,026 | 11,142 |
Application of deposit to purchase price of property | 0 | 75,000 |
Non-cash Financing Transactions | ||
Gain (loss) from market value adjustments | (4,027) | (37,927) |
Dividends declared | 111,177 | 98,501 |
Common stock issued in exchange for OP Units | 13,261 | 17,733 |
Unconsolidated Funds [Member] | ||
Non-cash Financing Transactions | ||
Gain (loss) from market value adjustments | $ 610 | $ (814) |
Overview
Overview | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Overview | Overview Organization and Business Description Douglas Emmett, Inc. is a fully integrated, self-administered and self-managed REIT. We are one of the largest owners and operators of high-quality office and multifamily properties in Los Angeles County, California and Honolulu, Hawaii. We focus on owning, acquiring, developing and managing a substantial share of top-tier office properties and premier multifamily communities in neighborhoods that possess significant supply constraints, high-end executive housing and key lifestyle amenities. Through our interest in our Operating Partnership and its subsidiaries, our consolidated JVs and our unconsolidated Funds, we own or partially own, acquire, develop and manage real estate, consisting primarily of office and multifamily properties in Los Angeles, California and Honolulu, Hawaii. The terms "us," "we" and "our" as used in the financial statements refer to Douglas Emmett, Inc. and its subsidiaries on a consolidated basis. As of September 30, 2017 , our portfolio of properties consisted of the following properties (not including two parcels of land from which we receive rent under ground leases): Consolidated Portfolio Total Portfolio Office (includes ancillary retail space) Wholly-owned properties 52 52 Consolidated JV properties 10 10 Unconsolidated Fund properties — 8 62 70 Multifamily Wholly-owned properties 10 10 Total 72 80 Basis of Presentation The accompanying financial statements are the consolidated financial statements of Douglas Emmett, Inc. and its subsidiaries, including our Operating Partnership and our consolidated JVs. All significant intercompany balances and transactions have been eliminated in our consolidated financial statements. Our Operating Partnership and consolidated JVs are VIEs and we are the primary beneficiary. As of September 30, 2017 , the total consolidated assets, liabilities and equity of the VIEs was $8.11 billion (of which $7.68 billion related to investment in real estate), $4.33 billion and $3.79 billion (of which $1.35 billion related to noncontrolling interests), respectively. The accompanying unaudited interim financial statements have been prepared pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with GAAP may have been condensed or omitted pursuant to SEC rules and regulations, although we believe that the disclosures are adequate to make their presentation not misleading. The accompanying unaudited interim financial statements include, in our opinion, all adjustments, consisting of normal recurring adjustments, necessary to present fairly the financial information set forth therein. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the year ending December 31, 2017 . The interim financial statements should be read in conjunction with the consolidated financial statements in our 2016 Annual Report on Form 10-K and the notes thereto. References in this Report to the number of properties, square footage, per square footage amounts, apartment units and geography, are outside the scope of our independent registered public accounting firm’s review of our financial statements in accordance with the standards of the PCAOB. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies We adopted ASU No. 2017-01, "Clarifying the Definition of a Business" in the first quarter of 2017. The ASU changed our accounting policy "Investment in Real Estate" disclosed in our 2016 Annual Report on Form 10-K. The ASU generally requires that our property acquisitions be accounted for as asset purchases, and the related acquisition expenses be capitalized as part of the respective asset. We historically accounted for our property acquisitions as business combinations and expensed the related acquisition expenses as incurred. During the nine months ended September 30, 2016, we expensed $2.9 million of acquisition-related expenses. We have not made any other changes during the period covered by this Report to our significant accounting policies disclosed in our 2016 Annual Report on Form 10-K. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make certain estimates that affect the reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. Income Taxes We have elected to be taxed as a REIT under the Code. Provided that we qualify for taxation as a REIT, we are generally not subject to corporate-level income tax on the earnings distributed currently to our stockholders that we derive from our REIT qualifying activities. We are subject to corporate-level tax on the earnings that we derive through our TRS. New Accounting Pronouncements Changes to GAAP are established by the FASB in the form of ASUs. We consider the applicability and impact of all ASUs. Recently Issued Accounting Pronouncements In August 2017, the FASB issued ASU No. 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities". The purpose of the ASU is to better align financial reporting for hedging activities with the economic objectives of those activities. The ASU requires periodic hedge ineffectiveness for derivatives designated as cash flow hedges and net investment hedges to be recognized in AOCI and no longer in earnings. The ASU is effective for fiscal years beginning after December 15, 2018, including interim periods within those years, which for us would be the first quarter of 2019, and early adoption is permitted. The ASU requires the cumulative effect of initially applying the ASU as an adjustment to AOCI with a corresponding adjustment to the opening balance of retained earnings as of the beginning of the fiscal year that the ASU is adopted. The amended presentation and disclosure guidance is required on a prospective basis. We do not expect the ASU to have a material impact on our financial statements. In February 2016, the FASB issued ASU No. 2016-02, "Leases" (Topic 842). The primary difference between Topic 842 and current GAAP is the recognition of lease assets and liabilities by lessees for leases classified as operating leases under current GAAP. The accounting applied by lessors is largely unchanged from current GAAP. For example, the vast majority of operating leases will remain classified as operating leases, and lessors will continue to recognize lease income for those leases on a straight-line basis over the lease term. Topic 842 requires an entity to separate the lease components from the non-lease components (for example, maintenance services or other activities that transfer a good or service to the customer) in a contract. Only the lease components must be accounted for in accordance with Topic 842. The consideration in the contract is allocated to the lease and non-lease components on a relative standalone price basis for lessees, or in accordance with the allocation guidance in Topic 606 for lessors. Topic 842 defines initial direct costs of a lease (which may be capitalized) as costs that would not have been incurred had the lease not been executed. Costs to negotiate a lease that would have been incurred regardless of whether the lease was executed, such as fixed employee salaries, are not considered to be initial direct costs, and may not be capitalized. The ASU is effective for annual and interim periods beginning after December 15, 2018, which for us would be the first quarter of 2019, and early adoption is permitted. The ASU is required to be adopted using a modified retrospective approach which includes optional practical expedients related to leases that commenced before the effective date. We are currently evaluating the impact of this ASU on our financial statements. In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers" (Topic 606), which provides guidance for the accounting of revenue from contracts with customers. The guidance supersedes the revenue recognition requirements in Topic 605, "Revenue Recognition", and most industry-specific guidance throughout the Industry Topics of the Codification. In August 2015, the FASB issued ASU No. 2015-14, which defers the effective date of ASU No. 2014-09 by one year. In March 2016, the FASB issued ASU No. 2016-08, "Principal versus Agent Considerations (Reporting Revenue Gross versus Net)" which amends Topic 606 and clarifies the guidance for principal versus agent considerations. In April 2016, the FASB issued ASU No. 2016-10, "Identifying Performance Obligations and Licensing" which amends Topic 606 and provides guidance for identifying performance obligations and licensing. In May 2016, the FASB issued ASU No. 2016-12, "Narrow-Scope Improvements and Practical Expedients" which amends Topic 606 and provides guidance for a variety of revenue recognition related topics. In February 2017, the FASB issued ASU No. 2017-05 "Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets" (Subtopic 610-20), which provides guidance for recognizing gains and losses from the transfer of nonfinancial assets in contracts with noncustomers. The various ASU's are effective for annual and interim periods beginning after December 15, 2017, which for us is the first quarter of 2018. Earlier application is permitted for annual and interim periods beginning after December 15, 2016, which for us was the first quarter of 2017. The amendments in these ASU's should be applied retrospectively. We are not planning on early adopting the ASU's and we currently evaluating method of adoption. We do not expect the ASU's to have a material impact on our financial statements. The FASB has not issued any other ASUs during 2017 that we expect to be applicable and have a material impact on our financial statements. |
Investment in Real Estate
Investment in Real Estate | 9 Months Ended |
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
Investment in Real Estate | Investment in Real Estate We generally account for our property acquisitions as asset purchases. Prior to January 1, 2017 we accounted for our acquisitions as business combinations. The results of operations from our acquisitions are included in our consolidated statements of operations after the respective acquisition dates. Acquisitions during the nine months ended September 30, 2017 On April 25, 2017 , a consolidated JV that we manage and in which we own an equity interest acquired two Class A office properties located in downtown Santa Monica, California for a total contract price of $352.8 million . The two properties are located at 1299 Ocean Avenue and 429 Santa Monica Boulevard. On July 20, 2017 , the same JV acquired a Class A office property in Beverly Hills, California located at 9665 Wilshire Boulevard, for a contract price of $177.0 million . The table below (in thousands) summarizes our purchase price allocations for the acquisitions. The difference between the contract prices and respective purchase prices below relates to prorations and similar matters: 1299 Ocean 429 Santa Monica 9665 Wilshire Building square footage 206 87 171 Investment in real estate: Land $ 22,748 $ 4,949 $ 5,568 Buildings and improvements 260,188 69,286 175,960 Tenant improvements and lease intangibles 5,010 3,248 1,112 Acquired above and below-market leases, net (10,683 ) (723 ) (4,339 ) Net assets and liabilities acquired $ 277,263 $ 76,760 $ 178,301 Acquisitions during the nine months ended September 30, 2016 Westwood Portfolio Acquisition On February 29, 2016 (Acquisition Date), a consolidated JV which we manage and in which we own an equity interest acquired four Class A office properties located in Westwood, California (Westwood Portfolio) for a contract price of $1.34 billion . As of the Acquisition Date, we had contributed sixty -percent of the equity to the JV, which was subsequently reduced to thirty -percent on May 31, 2016 (Sell Down Date) when we sold half of our equity interest to a third party investor. The table below (in thousands) summarizes our purchase accounting and funding sources for the acquisition: Sources and Uses of Funds Actual at Closing (1) Pro Forma Sell Down Adjustments (2) Pro Forma Building square footage 1,725 1,725 Uses of funds - Investment in real estate: Land $ 94,996 $ 94,996 Buildings and improvements 1,236,786 1,236,786 Tenant improvements and lease intangibles 50,439 50,439 Acquired above and below-market leases, net (3) (49,708 ) (49,708 ) Net assets and liabilities acquired (4) $ 1,332,513 $ 1,332,513 Source of funds: Cash on hand (5) $ 153,745 $ — $ 153,745 Credit facility (6) 290,000 (240,000 ) 50,000 Non-recourse term loan, net (7) 568,768 — 568,768 Noncontrolling interests 320,000 240,000 560,000 Total source of funds $ 1,332,513 $ — $ 1,332,513 ________________________________________________ (1) Reflects the purchase of the Westwood Portfolio on the Acquisition Date when we contributed sixty -percent of the equity to the consolidated JV. (2) Reflects our sale of thirty -percent of the equity in the JV on the Sell Down Date, presented as of the Acquisition Date, treated as in-substance real estate, which reduced our ownership interest in the JV to thirty -percent. We sold the interest for the $240.0 million we contributed plus an additional $1.1 million to compensate us for our costs of holding the investment. We recognized a gain on the sale of $1.1 million . We used the proceeds from the sale to pay down the balance owed on our revolving credit facility. (3) As of the Acquisition Date, the weighted average remaining life of the acquired above-and below-market leases was approximately 4.4 years . (4) The difference between the contract and purchase price related to credits received for prorations and similar matters. (5) Cash paid included a $75.0 million deposit, $67.5 million paid at closing and $11.2 million spent on loan costs in connection with securing the $580.0 million term loan. (6) Reflects borrowings using the Company's credit facility, which bears interest at LIBOR + 1.40% . (7) Reflects 100% (not the Company's pro rata share) of a $580.0 million interest-only non-recourse loan, net of deferred loan costs of $11.2 million incurred to secure the loan. The loan has a seven -year term and is secured by the Westwood Portfolio. Interest on the loan is floating at LIBOR + 1.40% , which has been effectively fixed at 2.37% per annum for five years through interest rate swaps. See Note 7 for information regarding our consolidated debt. The table below (in thousands) presents the revenues and net income attributable to common stockholders from the Westwood Portfolio included in the consolidated statement of operations after the Acquisition Date: Nine Months Ended September 30, 2017 2016 Total office revenues $ 71,530 $ 56,045 Net income attributable to common stockholders (1) $ 4,449 $ 1,444 ______________________________________________________ (1) Excluding transaction costs, net income attributable to common stockholders was $4.4 million and $3.5 million for the nine months ended September 30, 2017 and 2016 , respectively. The table below (in thousands, except per share information) presents the historical results of Douglas Emmett, Inc. and the Westwood Portfolio on a combined basis as if the acquisition was completed on January 1, 2016, based on our thirty -percent ownership interest and includes adjustments that give effect to events that are (i) directly attributable to the acquisition, (ii) expected to have a continuing impact on us, and (iii) are factually supportable. The pro forma reflects the hypothetical impact of the acquisition on us and does not purport to represent what our results of operations would have been had the acquisition occurred on January 1, 2016, or project the results of operations for any future period. The information does not reflect cost savings or operating synergies that may result from the acquisition or the costs to achieve any such potential cost savings or operating synergies. Transaction costs related to the acquisition have been excluded. Nine Months Ended September 30, 2016 Pro forma revenues $ 561,235 Pro forma net income attributable to common stockholders $ 64,623 Pro forma net income attributable to common stockholders per share – basic $ 0.433 Pro forma net income attributable to common stockholders per share – diluted $ 0.421 Other 2016 Acquisitions During the nine months ended September 30, 2016 , a consolidated JV that we manage and in which we own an equity interest acquired two Class A properties: (i) on July 21, 2016 , the JV acquired a multi-tenant office property located in Brentwood, California (12100 Wilshire Boulevard) for a contract price of $225.0 million , and (ii) on September 27, 2016 the JV acquired a multi-tenant office property located in Santa Monica, California (233 Wilshire Boulevard) for a contract price of $139.5 million . As of July 21, 2016 , we had contributed fifty-five percent of the equity to the JV, which was reduced to twenty -percent when we sold thirty-five percent to a third party investor for $51.6 million , which included $194 thousand to compensate us for our costs of holding the investment. We recognized a gain of $587 thousand on the sale, which is included in Gains on sales of investments in real estate in our consolidated statements of operations. In addition to purchasing a thirty-five percent interest from us, investors contributed $139.8 million to the JV. As of September 30, 2016 , including the effect of the sale of our interest, investors hold an aggregate of eighty -percent of the capital interests in the JV. As part of the acquisitions, the JV borrowed a total of $146.0 million under a three year, interest only, non-recourse loan bearing interest at LIBOR + 1.55% . The loan is secured by the acquired properties. See Note 7 . The table below (in thousands) summarizes our purchase accounting for the acquisitions. The difference between the contract prices and respective purchase prices relate to credits received for prorations and similar matters: 233 Wilshire 12100 Wilshire Building square footage 129 365 Investment in real estate: Land $ 9,263 $ 20,164 Buildings and improvements 126,938 199,698 Tenant improvements and lease intangibles 3,488 9,057 Acquired above and below-market leases, net (1,838 ) (4,523 ) Net assets and liabilities acquired $ 137,851 $ 224,396 2016 Disposition During the third quarter of 2016, we sold a 168,000 square foot Class A office property located in Sherman Oaks, California with a carrying value of $42.8 million for a contract price of $56.7 million , and we incurred transaction costs of $1.2 million resulting in a net gain of $12.7 million . The gain is included in Gains on sales of investments in real estate in our consolidated statements of operations. |
Acquired Lease Intangibles
Acquired Lease Intangibles | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Acquired Lease Intangibles | Acquired Lease Intangibles Summary of our Acquired Lease Intangibles The table below (in thousands) summarizes our above/below-market leases: September 30, 2017 December 31, 2016 Above-market tenant leases $ 5,461 $ 5,110 Accumulated amortization - above-market tenant leases (3,203 ) (2,379 ) Below-market ground leases 3,198 3,198 Accumulated amortization - below-market ground leases (840 ) (782 ) Acquired lease intangible assets, net $ 4,616 $ 5,147 Below-market tenant leases $ 117,077 $ 104,925 Accumulated accretion - below-market tenant leases (51,433 ) (41,241 ) Above-market ground leases 4,017 16,200 Accumulated accretion - above-market ground leases (547 ) (12,693 ) Acquired lease intangible liabilities, net $ 69,114 $ 67,191 Impact on the Consolidated Statements of Operations The table below (in thousands) summarizes the net amortization/accretion related to our above/below-market leases: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Net accretion of above/below-market tenant leases (1) $ 4,805 $ 5,093 $ 13,265 $ 13,390 Amortization of above-market ground lease (2) (4 ) (4 ) (13 ) (13 ) Accretion of above-market ground lease (3) 13 13 38 38 Total $ 4,814 $ 5,102 $ 13,290 $ 13,415 _______________________________________________ (1) Recorded as a net increase to office and multifamily rental revenues. (2) The amortization of the above-market rent we receive under this ground lease is recorded as a decrease to office parking and other income. (3) The accretion of the above-market rent we pay under this ground lease is recorded as a decrease to office expense. |
Investments in Unconsolidated R
Investments in Unconsolidated Real Estate Funds | 9 Months Ended |
Sep. 30, 2017 | |
Real Estate Investments, Net [Abstract] | |
Investments In Unconsolidated Real Estate Funds | Investments in Unconsolidated Real Estate Funds Description of our Funds We manage and own equity interests in three unconsolidated Funds, the Opportunity Fund, Fund X and Partnership X, through which we and investors own eight office properties totaling 1.8 million square feet. We purchased a 3.7% interest in the Opportunity Fund during the second quarter of 2017. The Opportunity Fund's only investment is a 13.1% equity interest in Fund X. At September 30, 2017 , we held direct and indirect equity interests of 3.7% of the Opportunity Fund, 69.1% of Fund X and 24.3% of Partnership X. Our Funds pay us fees and reimburse us for certain expenses related to property management and other services we provide. We also receive distributions based on invested capital and on any profits that exceed certain specified cash returns to the investors. The table below presents (in thousands) cash distributions received from our Funds: Nine Months Ended September 30, 2017 2016 Operating distributions received $ 4,427 $ 1,356 Capital distributions received 41,965 21,973 Total distributions received $ 46,392 $ 23,329 Summarized Financial Information for our Funds The accounting policies of the Funds are consistent with ours. The tables below present (in thousands) selected financial information for the Funds on a combined basis. The amounts presented represent 100% (not our pro-rata share) of amounts related to the Funds, and are based upon historical acquired book value: September 30, 2017 December 31, 2016 Total assets $ 703,776 $ 690,028 Total liabilities $ 524,968 $ 448,544 Total equity $ 178,808 $ 241,484 Nine Months Ended September 30, 2017 2016 Total revenues $ 56,550 $ 54,104 Operating income $ 14,918 $ 14,235 Net income $ 3,974 $ 6,539 |
Other Assets
Other Assets | 9 Months Ended |
Sep. 30, 2017 | |
Other Assets [Abstract] | |
Other Assets | Other Assets Other assets consisted of the following (in thousands): September 30, 2017 December 31, 2016 Restricted cash $ 121 $ 121 Prepaid expenses 11,481 6,779 Other indefinite-lived intangible 1,988 1,988 Furniture, fixtures and equipment, net 1,078 1,093 Other 2,610 1,933 Total other assets $ 17,278 $ 11,914 |
Secured Notes Payable and Revol
Secured Notes Payable and Revolving Credit Facility, Net | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Secured Notes Payable and Revolving Credit Facility, Net | Secured Notes Payable and Revolving Credit Facility, Net The following table summarizes (in thousands) our secured notes payable and revolving credit facility: Description Maturity Date (1) Principal Balance as of September 30, 2017 Principal Balance as of December 31, 2016 Variable Interest Rate Fixed Interest Rate (2) Swap Maturity Date Wholly Owned Subsidiaries Term loan (3) — $ — $ 1,000 — — — Term loan (3) — — 349,933 — — — Fannie Mae loans (3) — — 388,080 — — — Term loan (3) — — 345,759 — — — Term loan (4) 2/1/2019 147,719 149,911 N/A 4.00% — Term loan (4) 6/5/2019 282,019 285,000 N/A 3.85% — Fannie Mae loan 10/1/2019 145,000 145,000 LIBOR + 1.25% N/A — Term loan (5) 4/15/2022 340,000 340,000 LIBOR + 1.40% 2.77% 4/1/2020 Term loan (5) 7/27/2022 180,000 180,000 LIBOR + 1.45% 3.06% 7/1/2020 Term loan (5) 11/1/2022 400,000 400,000 LIBOR + 1.35% 2.64% 11/1/2020 Term loan (5) 6/23/2023 360,000 360,000 LIBOR + 1.55% 2.57% 7/1/2021 Term loan (5) 12/23/2023 220,000 220,000 LIBOR + 1.70% 3.62% 12/23/2021 Term loan (5) 1/1/2024 300,000 300,000 LIBOR + 1.55% 3.46% 1/1/2022 Fannie Mae loan (5) 4/1/2025 102,400 102,400 LIBOR + 1.25% 2.84% 3/1/2020 Fannie Mae loans (5) 12/1/2025 115,000 115,000 LIBOR + 1.25% 2.76% 12/1/2020 Fannie Mae loans (5)(6) 6/1/2027 550,000 — LIBOR + 1.37% 3.51% 6/1/2022 Revolving credit facility (7) 8/21/2020 — — LIBOR + 1.40% N/A — Total Wholly Owned Subsidiary Debt 3,142,138 3,682,083 Consolidated JVs Term loan 7/21/2019 365,500 146,000 LIBOR + 1.55% N/A — Term loan (5) 2/28/2023 580,000 580,000 LIBOR + 1.40% 2.37% 3/1/2021 Total Consolidated Debt (8) 4,087,638 4,408,083 Deferred loan costs, net (38,810 ) (38,546 ) Total Consolidated Debt, net $ 4,048,828 $ 4,369,537 ___________________________________________________ Except as noted below, each loan (including our revolving credit facility) is non-recourse and secured by one or more separate collateral pools consisting of one or more properties, and requires monthly payments of interest only with the outstanding principal due upon maturity. (1) Maturity dates include the effect of extension options. (2) Includes the effect of interest rate swaps and excludes the effect of prepaid loan fees. See Note 9 for details of our interest rate swaps. (3) At September 30, 2017 , this loan had been paid off. (4) Require monthly payments of principal and interest. Principal amortization is based upon a 30 -year amortization schedule. (5) Loan agreement includes a zero-percent LIBOR floor. The corresponding swaps do not include such a floor. (6) Effective rate decreases to 3.16% on November 1, 2017 . (7) $400.0 million revolving credit facility. Unused commitment fees range from 0.15% to 0.20% . (8) See Note 12 for our fair value disclosures. Debt Statistics The following table summarizes (in thousands) our fixed and floating rate debt: Principal Balance as of September 30, 2017 Principal Balance as of December 31, 2016 Aggregate swapped to fixed rate loans $ 3,147,400 $ 2,985,480 Aggregate fixed rate loans 429,738 1,131,603 Aggregate floating rate loans 510,500 291,000 Total Debt $ 4,087,638 $ 4,408,083 The following table summarizes our fixed rate debt statistics: Fixed Rate Debt (fixed under the terms of the loan or a swap) Principal balance (in billions) $3.58 Weighted average remaining life (including extension options) 5.8 years Weighted average remaining fixed interest period 3.3 years Weighted average annual interest rate 3.08% Future Principal Payments At September 30, 2017 , the minimum future principal payments due on our secured notes payable and revolving credit facility, excluding the impact of any maturity extension options, were as follows (in thousands): Twelve months ending September 30: 2018 $ 8,294 2019 786,944 2020 325,000 2021 115,000 2022 640,000 Thereafter 2,212,400 Total future principal payments $ 4,087,638 Loan Costs Deferred loan costs are net of accumulated amortization of $15.9 million and $15.4 million at September 30, 2017 and December 31, 2016 , respectively. The table below presents (in thousands) our loan costs, which are included in Interest Expense in our consolidated statements of operations: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Loan costs expensed $ 163 $ — $ 539 $ 818 Deferred loan cost amortization 2,343 2,227 6,865 5,470 Total $ 2,506 $ 2,227 $ 7,404 $ 6,288 |
Interest Payable, Accounts Paya
Interest Payable, Accounts Payable and Deferred Revenue | 9 Months Ended |
Sep. 30, 2017 | |
Accounts Payable and Accrued Liabilities [Abstract] | |
Interest Payable, Accounts Payable and Deferred Revenue | Interest Payable, Accounts Payable and Deferred Revenue Interest payable, accounts payable and deferred revenue consisted of the following (in thousands): September 30, 2017 December 31, 2016 Interest payable $ 9,760 $ 9,561 Accounts payable and accrued liabilities 80,572 36,880 Deferred revenue 28,031 28,788 Total interest payable, accounts payable and deferred revenue $ 118,363 $ 75,229 |
Derivative Contracts
Derivative Contracts | 9 Months Ended |
Sep. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Contracts | Derivative Contracts Derivative Summary As of September 30, 2017 , all of our interest rate swaps, which include the interest rate swaps of our consolidated JVs and our unconsolidated Funds, were designated as cash flow hedges: Number of Interest Rate Swaps Notional (in thousands) Consolidated derivatives (1) 26 $ 3,147,400 Unconsolidated Funds' derivatives (2) 4 $ 510,000 ___________________________________________________ (1) The notional amount includes 100% , not our pro-rata share, of our consolidated JVs' derivatives. (2) The notional amount includes 100% , not our pro-rata share, of our unconsolidated Funds' derivatives. Credit-risk-related Contingent Features We have agreements with each of our interest rate swap counterparties that contain a provision under which we could also be declared in default on our derivative obligations if we default on the underlying indebtedness that we are hedging. As of September 30, 2017 , there have been no events of default with respect to our interest rate swaps or our unconsolidated Funds' interest rate swaps. We do not post collateral for our swaps in a liability position. The fair value of our interest rate swaps in a liability position were as follows (in thousands): Fair value of derivatives in a liability position (1) September 30, 2017 December 31, 2016 Consolidated derivatives (2) $ 2,636 $ 7,689 Unconsolidated Funds' derivatives (3) $ — $ — __________________________________________________________________________________ (1) Includes accrued interest and excludes adjustments for credit risk. (2) Includes 100% , not our pro-rata share, of our consolidated JVs' derivatives. (3) Our unconsolidated Funds did not have any derivatives in a liability position. Counterparty Credit Risk We are also subject to credit risk from the counterparties on our interest rate swap and interest rate cap contracts. We seek to minimize our credit risk by entering into agreements with a variety of high quality counterparties with investment grade ratings. We do not receive collateral for our swaps in an asset position. The fair value of our interest rate swaps in an asset position were as follows (in thousands): Fair value of derivatives in an asset position (1) September 30, 2017 December 31, 2016 Consolidated derivatives (2) $ 37,258 $ 35,144 Unconsolidated Funds' derivatives (3) $ 4,437 $ 3,724 ___________________________________________________ (1) Includes accrued interest and excludes adjustments for credit risk. (2) Includes 100% , not our pro-rata share, of our consolidated JVs' derivatives. (3) Includes 100% , not our pro-rata share, of our unconsolidated Funds' derivatives. Impact of Hedges on AOCI and Consolidated Statements of Operations The table below presents (in thousands) the effect of derivative instruments on our AOCI and statements of operations: Nine Months Ended September 30, 2017 2016 Derivatives Designated as Cash Flow Hedges: Loss recorded in AOCI - consolidated derivatives (1)(5) $ (4,027 ) $ (37,927 ) Gain (loss) recorded in AOCI - unconsolidated Funds' derivatives (2)(5) $ 610 $ (814 ) Loss reclassified from AOCI - consolidated derivatives (3)(5) $ (10,353 ) $ (21,361 ) Loss reclassified from AOCI - unconsolidated Funds' derivatives (4)(5) $ (193 ) $ (311 ) Gain recorded - consolidated derivatives (6) $ 38 $ — Derivatives Not Designated as Cash Flow Hedges: Gain (loss) recorded as interest expense (7) $ — $ — ___________________________________________________ (1) Represents the effective portion of the change in fair value of interest rate swaps. (2) Represents our share of the effective portion of the change in fair value of our unconsolidated Funds' interest rate swaps. (3) Reclassified from AOCI as an increase to Interest expense. (4) Reclassified from AOCI as an increase (decrease) to Income, including depreciation, from unconsolidated real estate funds (our share). (5) See the reconciliation of our AOCI in Note 10 . (6) Represents the ineffective portion of the change in fair value of interest rate swaps, which is recorded as a decrease (increase) to interest expense. Our unconsolidated Funds did not have any ineffectiveness related to their interest rate swaps. (7) We and our unconsolidated Funds do not have any derivatives that are not designated as cash flow hedges. Future Reclassifications from AOCI At September 30, 2017 , our estimate of the AOCI related to derivatives, designated as cash flow hedges, that will be reclassified to earnings during the next twelve months as swap interest payments are made, is presented in the table below (in thousands): Consolidated derivatives (1) $ (702 ) Unconsolidated Funds' derivatives (2) $ 772 ________________________________________ (1) Reclassified as an increase to Interest expense. (2) Reclassified as an increase to Income, including depreciation, from unconsolidated real estate funds (our share). |
Equity
Equity | 9 Months Ended |
Sep. 30, 2017 | |
Stockholders' Equity Note [Abstract] | |
Equity | Equity Equity Transactions During the nine months ended September 30, 2017 , we (i) acquired 986 thousand OP Units in exchange for issuing an equal number of shares of our common stock to the holders of the OP Units, (ii) issued 1.3 million shares of our common stock for the exercise of 3.9 million stock options on a net settlement basis (net of the exercise price and related taxes) and (iii) issued 15.7 million shares of our common stock under our ATM program for net proceeds of $593.3 million . During the nine months ended September 30, 2016 , we (i) acquired 1.3 million OP Units in exchange for issuing an equal number of shares of our common stock to the holders of the OP Units, (ii) acquired 25 thousand OP Units for $826 thousand in cash, at an average price of $33.05 per OP Unit, (iii) issued 1.5 million shares of our common stock for the exercise of 7.6 million stock options on a net settlement basis (net of the exercise price and related taxes) and (iv) issued 1.4 million shares of our common stock under our ATM program for net proceeds of $49.4 million . We also created two JV's to acquire various properties: (i) in the first JV, which acquired the Westwood Portfolio, investors acquired an aggregate of seventy -percent of the capital interests, as a result of contributing $320.0 million directly to the JV for a forty -percent interest and acquiring a thirty -percent interest from us for $241.1 million (resulting in a gain of $1.1 million ), and (ii) in the second JV, which acquired properties during the third quarter, investors acquired an aggregate of eighty -percent of the capital interests, as a result of contributing $139.8 million directly to the JV and acquiring a thirty-five -percent interest from us for $51.6 million (resulting in a gain of $587 thousand ). See Note 3 . Condensed Consolidated Statements of Equity The tables below present (in thousands) our condensed consolidated statements of equity: DEI Stockholders' Equity Noncontrolling Interests Total Equity Balance as of January 1, 2017 $ 1,921,143 $ 1,092,928 $ 3,014,071 Net income 64,907 7,534 72,441 Cash flow hedge fair value adjustments 7,383 (254 ) 7,129 Contributions to consolidated JVs — 284,248 284,248 Dividends and distributions (111,177 ) (28,682 ) (139,859 ) Exchange of OP units for common stock 13,261 (13,261 ) — Exercise of stock options (1) (52,867 ) — (52,867 ) Stock-based compensation — 8,642 8,642 Sale of common stock, net of offering costs 593,272 — 593,272 Balance as of September 30, 2017 $ 2,435,922 $ 1,351,155 $ 3,787,077 __________________________________________________ (1) Reflects withholding taxes. We issued shares of our common stock for the exercise of stock options on a net settlement basis (net of the exercise price and related taxes). DEI Stockholders' Equity Noncontrolling Interests Total Equity Balance as of January 1, 2016 $ 1,926,211 $ 355,337 $ 2,281,548 Net income 65,696 7,928 73,624 Cash flow hedge fair value adjustments (14,376 ) (2,693 ) (17,069 ) Contributions to consolidated JV — 459,750 459,750 Sale of equity interest in consolidated JV — 291,029 291,029 Dividends and distributions (98,501 ) (26,185 ) (124,686 ) Exchange of OP units for common stock 17,733 (17,733 ) — Repurchase of OP units (498 ) (328 ) (826 ) Exercise of stock options (1) (53,467 ) — (53,467 ) Stock-based compensation — 7,759 7,759 Sale of common stock, net of offering costs 49,379 — 49,379 Balance as of September 30, 2016 $ 1,892,177 $ 1,074,864 $ 2,967,041 __________________________________________________ (1) Reflects withholding taxes. We issued shares of our common stock for the exercise of stock options on a net settlement basis (net of the exercise price and related taxes). Noncontrolling Interests Our noncontrolling interests consist of interests in our Operating Partnership and consolidated JVs which are not owned by us. Noncontrolling interests in our Operating Partnership consist of OP Units and fully-vested LTIP Units, and represented approximately 13% of our Operating Partnership's total interests as of September 30, 2017 when we and our Operating Partnership had 169.5 million shares of common stock and 24.7 million OP Units and fully-vested LTIP Units outstanding. A share of our common stock, an OP Unit and an LTIP Unit (once vested and booked up) have essentially the same economic characteristics, sharing equally in the distributions from our Operating Partnership. Investors who own OP Units have the right to cause our Operating Partnership to redeem their OP Units for an amount of cash per unit equal to the market value of one share of our common stock at the date of redemption, or, at our election, exchange their OP Units for shares of our common stock on a one-for-one b asis. LTIP Units have been granted to our key employees and non-employee directors as part of their compensation. These awards generally vest over the service period and once vested can generally be converted to OP Units. Changes in our Ownership Interest in our Operating Partnership The table below presents (in thousands) the effect on our equity from net income attributable to common stockholders and changes in our ownership interest in our Operating Partnership: Nine Months Ended September 30, 2017 2016 Net income attributable to common stockholders $ 64,907 $ 65,696 Transfers from noncontrolling interests: Exchange of OP Units with noncontrolling interests 13,261 17,733 Repurchase of OP Units from noncontrolling interests — (498 ) Net transfers from noncontrolling interests 13,261 17,235 Change from net income attributable to common stockholders and transfers from noncontrolling interests $ 78,168 $ 82,931 AOCI Reconciliation (1) The table below presents (in thousands) a reconciliation of our AOCI, which consists solely of adjustments related to derivatives designated as cash flow hedges for the nine months ended September 30 : 2017 2016 Beginning balance $ 15,156 $ (9,285 ) Other comprehensive loss before reclassifications - our derivatives (4,027 ) (37,927 ) Other comprehensive income (loss) before reclassifications - our Funds' derivatives 610 (814 ) Reclassifications from AOCI - our derivatives (2) 10,353 21,361 Reclassifications from AOCI - our Funds' derivatives (3) 193 311 Net current period OCI 7,129 (17,069 ) OCI attributable to noncontrolling interests 254 2,693 OCI attributable to common stockholders 7,383 (14,376 ) Ending balance $ 22,539 $ (23,661 ) ___________________________________________________ (1) See Note 9 for the details of our derivatives and Note 12 for our derivative fair value disclosures. (2) Reclassification as an increase to Interest expense. (3) Reclassification as an (increase) decrease to Income, including depreciation, from unconsolidated real estate funds. Equity Compensation On June 2, 2016, the Douglas Emmett 2016 Omnibus Stock Incentive Plan ("2016 Plan") became effective after receiving stockholder approval, superseding our prior plan, the Douglas Emmett 2006 Omnibus Stock Incentive Plan ("2006 Plan"), both of which allow for awards to our directors, officers, employees and consultants. The key terms of the two plans are substantially identical, except for the date of expiration, the number of shares authorized for grants and various technical provisions. Grants after June 2, 2016 were awarded under the 2016 Plan, while grants prior to that date were awarded under the 2006 Plan (grants under the 2006 Plan remain outstanding according to their terms). Both plans are administered by the compensation committee of our board of directors. Total net stock-based compensation expense was $2.6 million and $2.3 million for the three months ended September 30, 2017 and 2016 , and $7.9 million and $7.1 million for the nine months ended September 30, 2017 and 2016 respectively. These amounts are net of capitalized stock-based compensation of $257 thousand and $235 thousand for the three months ended September 30, 2017 and 2016 , and $732 thousand and $683 thousand for the nine months ended September 30, 2017 and 2016 respectively. The intrinsic value of options exercised was $0.4 million and $2.1 million for the three months ended September 30, 2017 and 2016 , and $102.5 million and $104.0 million during the nine months ended September 30, 2017 and 2016 , respectively. |
EPS
EPS | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
EPS | EPS We calculate basic EPS by dividing the net income attributable to common stockholders for the period by the weighted average number of common shares outstanding during the period. We calculate diluted EPS by dividing the net income attributable to common stockholders for the period by the weighted average number of common shares and dilutive instruments outstanding during the period using the treasury stock method. We account for unvested LTIP awards that contain nonforfeitable rights to dividends as participating securities and include these securities in the computation of basic and diluted EPS using the two-class method. The table below presents the calculation of basic and diluted EPS: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Numerator (in thousands): Net income attributable to common stockholders $ 25,614 $ 31,848 $ 64,907 $ 65,696 Allocation to participating securities: Unvested LTIP Units (158 ) (180 ) (345 ) (365 ) Numerator for basic and diluted net income attributable to common stock holders $ 25,456 $ 31,668 $ 64,562 $ 65,331 Denominator (in thousands): Weighted average shares of common stock outstanding - basic 165,471 150,753 158,000 148,578 Effect of dilutive securities: Stock options (1) 49 2,666 419 4,241 Weighted average shares of common stock and common stock equivalents outstanding - diluted 165,520 153,419 158,419 152,819 Basic EPS: Net income attributable to common stockholders per share $ 0.154 $ 0.210 $ 0.409 $ 0.440 Diluted EPS: Net income attributable to common stockholders per share $ 0.154 $ 0.206 $ 0.408 $ 0.428 ____________________________________________________ (1) The following securities (in thousands) were excluded from the computation of the weighted average shares of common stock and common stock equivalents outstanding - diluted because the effect of including them would be anti-dilutive to the calculation of diluted EPS: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 OP Units 24,790 24,788 24,750 25,148 Vested LTIP Units 8 675 358 766 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Our estimates of the fair value of financial instruments were determined using available market information and widely used valuation methods. Considerable judgment is necessary to interpret market data and determine an estimated fair value. The use of different market assumptions or valuation methods may have a material effect on the estimated fair values. The FASB fair value framework hierarchy distinguishes between assumptions based on market data obtained from sources independent of the reporting entity, and the reporting entity’s own assumptions about market-based inputs. The hierarchy is as follows: Level 1 - inputs utilize unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 - inputs are observable either directly or indirectly for similar assets and liabilities in active markets. Level 3 - inputs are unobservable assumptions generated by the reporting entity As of September 30, 2017 , we did not have any fair value estimates of financial instruments using Level 3 inputs. Financial instruments disclosed at fair value Short term financial instruments: The carrying amounts for cash and cash equivalents, tenant receivables, revolving credit line, interest payable, accounts payable, security deposits and dividends payable approximate fair value because of the short-term nature of these instruments. Secured notes payable: See Note 7 for the details of our secured notes payable. We estimate the fair value of our secured notes payable, which includes the secured notes payable of our consolidated JVs, by calculating the credit-adjusted present value of the principal and interest payments for each secured note payable. The calculation incorporates observable market interest rates which we consider to be Level 2 inputs, assumes that the loans will be outstanding through maturity, and excludes any maturity extension options. The table below presents (in thousands) the estimated fair value of our secured notes payable: Secured Notes Payable: September 30, 2017 December 31, 2016 Fair value $ 4,080,901 $ 4,429,224 Carrying value $ 4,087,638 $ 4,408,083 Financial instruments measured at fair value Derivative instruments: See Note 9 for the details of our derivatives. We present our derivatives on the balance sheet at fair value, on a gross basis, excluding accrued interest. We estimate the fair value of our derivative instruments by calculating the credit-adjusted present value of the expected future cash flows of each derivative. The calculation incorporates the contractual terms of the derivatives, observable market interest rates which we consider to be Level 2 inputs, and credit risk adjustments to reflect the counterparty's as well as our own nonperformance risk. Our derivatives are not subject to master netting arrangements. The table below presents (in thousands) the estimated fair value of our derivatives: September 30, 2017 December 31, 2016 Derivative Assets: Fair value - consolidated derivatives (1) $ 37,115 $ 35,656 Fair value - unconsolidated Funds' derivatives (2) $ 4,632 $ 3,605 Derivative Liabilities: Fair value - consolidated derivatives (1) $ 2,002 $ 6,830 Fair value - unconsolidated Funds' derivatives (2) $ — $ — ____________________________________________________ (1) Consolidated derivatives, which include 100% , not our pro-rata share, of our consolidated JVs' derivatives, are included in interest rate contracts in our consolidated balance sheet. The fair value excludes accrued interest which is included in interest payable in the consolidated balance sheet. (2) Represents 100% , not our pro-rata share, of our unconsolidated Funds' derivatives. Our pro-rata share of the amounts related to the unconsolidated Funds' derivatives is included in our Investment in unconsolidated real estate funds in our consolidated balance sheet. See Note 5 for more information regarding our unconsolidated Funds. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting Segment information is prepared on the same basis that our management reviews information for operational decision-making purposes. We operate in two business segments: (i) the acquisition, development, ownership and management of office real estate and (ii) the acquisition, development, ownership and management of multifamily real estate. The services for our office segment primarily include rental of office space and other tenant services, including parking and storage space rental. The services for our multifamily segment include rental of apartments and other tenant services, including parking and storage space rental. Asset information by segment is not reported because we do not use this measure to assess performance or make decisions to allocate resources. Therefore, depreciation and amortization expense is not allocated among segments. General and administrative expenses and interest expense are not included in segment profit as our internal reporting addresses these items on a corporate level. Segment profit is not a measure of operating income or cash flows from operating activities as measured by GAAP, it is not indicative of cash available to fund cash needs, and it should not be considered as an alternative to cash flows as a measure of liquidity. Not all companies may calculate segment profit in the same manner. We consider segment profit to be an appropriate supplemental measure to net income because it can assist both investors and management in understanding the core operations of our properties. The table below presents (in thousands) the operating activity of our reportable segments: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Office Segment Total office revenues $ 184,618 $ 167,608 $ 530,508 $ 475,083 Office expenses (62,468 ) (56,926 ) (175,240 ) (158,190 ) Office segment profit 122,150 110,682 355,268 316,893 Multifamily Segment Total multifamily revenues 24,131 24,513 72,354 72,825 Multifamily expenses (6,041 ) (5,950 ) (17,866 ) (17,322 ) Multifamily segment profit 18,090 18,563 54,488 55,503 Total profit from all segments $ 140,240 $ 129,245 $ 409,756 $ 372,396 The table below (in thousands) is a reconciliation of the total profit from all segments to net income attributable to common stockholders: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Total profit from all segments $ 140,240 $ 129,245 $ 409,756 $ 372,396 General and administrative (8,441 ) (8,099 ) (27,189 ) (25,573 ) Depreciation and amortization (69,974 ) (63,827 ) (206,141 ) (181,947 ) Other income 2,659 2,295 7,152 6,527 Other expenses (1,659 ) (2,916 ) (5,156 ) (7,828 ) Income, including depreciation, from unconsolidated real estate funds 1,137 2,334 4,427 5,564 Interest expense (35,454 ) (36,479 ) (110,408 ) (109,842 ) Income before gains 28,508 22,553 72,441 59,297 Gains on sales of investments in real estate — 13,245 — 14,327 Net income 28,508 35,798 72,441 73,624 Less: Net income attributable to noncontrolling interests (2,894 ) (3,950 ) (7,534 ) (7,928 ) Net income attributable to common stockholders $ 25,614 $ 31,848 $ 64,907 $ 65,696 |
Future Minimum Lease Rental Rec
Future Minimum Lease Rental Receipts | 9 Months Ended |
Sep. 30, 2017 | |
Operating Leases, Future Minimum Payments Receivable [Abstract] | |
Future Minimum Lease Rental Receipts | Future Minimum Lease Rental Receipts We lease space to tenants primarily under non-cancelable operating leases that generally contain provisions for a base rent plus reimbursement of certain operating expenses, and we own fee interests in two parcels of land subject to ground leases from which we earn ground rent income. The table below presents (in thousands) the future minimum base rentals on our non-cancelable office tenant and ground leases at September 30, 2017 : Twelve months ending September 30: 2018 $ 528,867 2019 477,732 2020 416,289 2021 333,742 2022 251,975 Thereafter 657,646 Total future minimum base rentals (1) $ 2,666,251 _____________________________________________________ (1) Does not include (i) residential leases, which typically have a term of one year or less, (ii) holdover rent, (iii) other types of rent such as storage rent and antenna rent, (iv) tenant reimbursements, (v) straight line rent, (vi) amortization/accretion of acquired above/below-market lease intangibles and (vii) percentage rents. The amounts assume that early termination options held by tenants are not exercised. |
Future Minimum Lease Rental Pay
Future Minimum Lease Rental Payments | 9 Months Ended |
Sep. 30, 2017 | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
Future Minimum Lease Rental Payments | Future Minimum Lease Rental Payments We incurred ground rent expense for a ground lease of $183 thousand for the three months ended September 30, 2017 and 2016 and $550 thousand for the nine months ended September 30, 2017 and 2016 . The table below (in thousands) presents the future minimum ground lease payments as of September 30, 2017 : Twelve months ending September 30: 2018 $ 733 2019 733 2020 733 2021 733 2022 733 Thereafter 47,094 Total future minimum lease payments (1) $ 50,759 ___________________________________________________ (1) Lease term ends on December 31, 2086 . Ground rent is fixed at $733 thousand per year until February 28, 2019 , and will then reset to the greater of the existing ground rent or market. The table above assumes that the rental payments will continue to be $733 thousand per year after February 28, 2019 . |
Commitments, Contingencies and
Commitments, Contingencies and Guarantees | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, Contingencies and Guarantees | Commitments, Contingencies and Guarantees Legal Proceedings From time to time, we are party to various lawsuits, claims and other legal proceedings that arise in the ordinary course of our business. Excluding ordinary, routine litigation incidental to our business, we are not currently a party to any legal proceedings that we believe would reasonably be expected to have a materially adverse effect on our business, financial condition or results of operations. Concentration of Risk We are subject to credit risk with respect to our tenant receivables and deferred rent receivables related to our tenant leases. Our tenants' ability to honor the terms of their respective leases remains dependent upon economic, regulatory and social factors. We seek to minimize our credit risk from our tenant leases by (i) targeting smaller, more affluent tenants, from a diverse mix of industries, (ii) performing credit evaluations of prospective tenants and (iii) obtaining security deposits or letters of credit from our tenants. For the nine months ended September 30, 2017 and 2016 , no tenant accounted for more than 10% of our total revenues. All of our properties, including the properties of our consolidated JVs and unconsolidated Funds, are located in Los Angeles County, California and Honolulu, Hawaii, and we are therefore susceptible to adverse economic and regulatory developments, as well as natural disasters, in those markets. We are also subject to credit risk with respect to our interest rate swap counterparties that we use to manage the risk associated with our floating rate debt. We do not post or receive collateral with respect to our swap transactions. See Note 9 for the details of our interest rate contracts. We seek to minimize our credit risk by entering into agreements with a variety of high quality counterparties with investment grade ratings. We have significant cash balances invested in a variety of short-term money market funds that are intended to preserve principal value and maintain a high degree of liquidity while providing current income. These investments are not insured against loss of principal and there is no guarantee that our investments in these funds will be redeemable at par value. We also have significant cash balances in bank accounts with high quality financial institutions with investment grade ratings. Interest bearing bank accounts at each U.S. banking institution are insured by the FDIC up to $250 thousand . Asset Retirement Obligations Conditional asset retirement obligations represent a legal obligation to perform an asset retirement activity in which the timing and/or method of settlement is conditional on a future event that may or may not be within our control. A liability for a conditional asset retirement obligation must be recorded if the fair value of the obligation can be reasonably estimated. Environmental site assessments have identified twenty-seven buildings in our Consolidated Portfolio and four buildings owned by our unconsolidated Funds which contain asbestos, and would have to be removed in compliance with applicable environmental regulations if these properties are demolished or undergo major renovations. As of September 30, 2017 , the obligations to remove the asbestos from these properties have indeterminable settlement dates, and we are unable to reasonably estimate the fair value of the associated conditional asset retirement obligation. Development Contracts During the first quarter of 2016, we commenced building an additional 475 apartments (net of existing apartments removed) at our Moanalua Hillside Apartments in Honolulu, Hawaii. The $120.0 million estimated cost of the new apartments does not include the cost of the land which we already owned before beginning the project. We are also investing additional capital to upgrade the existing apartments, improve the parking and landscaping, building a new leasing and management office, and construct a new recreation and fitness facility with a new pool. In West Los Angeles, we plan to build a high-rise apartment building with 376 apartments. We expect the cost of the development to be approximately $180.0 million to $200.0 million , which does not include the cost of the land or the existing underground parking garage, both of which we owned before beginning the project. As of September 30, 2017 , we had an aggregate remaining contractual commitment for these development projects of approximately $73.1 million . Other Contracts As of September 30, 2017 , we had an aggregate remaining contractual commitment for capital expenditure projects and repositionings of approximately $4.8 million . Guarantees We made certain environmental and other limited indemnities and guarantees covering customary non-recourse carve- outs for our unconsolidated Funds' debt. We also guaranteed the related swaps. Our Funds have agreed to indemnify us for any amounts that we would be required to pay under these agreements. As of September 30, 2017 , all of the obligations under the related debt and swap agreements have been performed in accordance with the terms of those agreements. The table below summarizes our Funds' debt as of September 30, 2017 . The amounts represent 100% (not our pro-rata share) of amounts related to our Funds: Fund (1) Loan Maturity Date Principal Balance (in millions) Variable Interest Rate Swap Fixed Interest Rate Swap Maturity Date Partnership X (2)(4) 3/1/2023 $ 110.0 LIBOR + 1.40% 2.30% 3/1/2021 Fund X (3)(4)(5) 7/1/2024 400.0 LIBOR + 1.65% 3.44% 7/1/2022 $ 510.0 ___________________________________________________ (1) See Note 5 for more information regarding our unconsolidated Funds. (2) Floating rate term loan, swapped to fixed, which is secured by two properties and requires monthly payments of interest only, with the outstanding principal due upon maturity. As of September 30, 2017 , assuming a zero-percent LIBOR interest rate during the remaining life of the swap, the maximum future payments under the swap agreement were $3.4 million . (3) Floating rate term loan, swapped to fixed, which is secured by six properties and requires monthly payments of interest only, with the outstanding principal due upon maturity. As of September 30, 2017 , assuming a zero-percent LIBOR interest rate during the remaining life of the swap, the maximum future payments under the swap agreement were $34.5 million . (4) Loan agreement includes a zero-percent LIBOR floor. The corresponding swaps do not include such a floor. (5) Loan agreement includes the requirement to purchase an interest rate cap if one month LIBOR equals or exceeds 3.56% for fourteen consecutive days after the related swap matures. |
Summary of Significant Accoun23
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying financial statements are the consolidated financial statements of Douglas Emmett, Inc. and its subsidiaries, including our Operating Partnership and our consolidated JVs. All significant intercompany balances and transactions have been eliminated in our consolidated financial statements. Our Operating Partnership and consolidated JVs are VIEs and we are the primary beneficiary. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make certain estimates that affect the reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. |
Income Taxes | Income Taxes We have elected to be taxed as a REIT under the Code. Provided that we qualify for taxation as a REIT, we are generally not subject to corporate-level income tax on the earnings distributed currently to our stockholders that we derive from our REIT qualifying activities. We are subject to corporate-level tax on the earnings that we derive through our TRS. |
New Accounting Pronouncements | New Accounting Pronouncements Changes to GAAP are established by the FASB in the form of ASUs. We consider the applicability and impact of all ASUs. Recently Issued Accounting Pronouncements In August 2017, the FASB issued ASU No. 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities". The purpose of the ASU is to better align financial reporting for hedging activities with the economic objectives of those activities. The ASU requires periodic hedge ineffectiveness for derivatives designated as cash flow hedges and net investment hedges to be recognized in AOCI and no longer in earnings. The ASU is effective for fiscal years beginning after December 15, 2018, including interim periods within those years, which for us would be the first quarter of 2019, and early adoption is permitted. The ASU requires the cumulative effect of initially applying the ASU as an adjustment to AOCI with a corresponding adjustment to the opening balance of retained earnings as of the beginning of the fiscal year that the ASU is adopted. The amended presentation and disclosure guidance is required on a prospective basis. We do not expect the ASU to have a material impact on our financial statements. In February 2016, the FASB issued ASU No. 2016-02, "Leases" (Topic 842). The primary difference between Topic 842 and current GAAP is the recognition of lease assets and liabilities by lessees for leases classified as operating leases under current GAAP. The accounting applied by lessors is largely unchanged from current GAAP. For example, the vast majority of operating leases will remain classified as operating leases, and lessors will continue to recognize lease income for those leases on a straight-line basis over the lease term. Topic 842 requires an entity to separate the lease components from the non-lease components (for example, maintenance services or other activities that transfer a good or service to the customer) in a contract. Only the lease components must be accounted for in accordance with Topic 842. The consideration in the contract is allocated to the lease and non-lease components on a relative standalone price basis for lessees, or in accordance with the allocation guidance in Topic 606 for lessors. Topic 842 defines initial direct costs of a lease (which may be capitalized) as costs that would not have been incurred had the lease not been executed. Costs to negotiate a lease that would have been incurred regardless of whether the lease was executed, such as fixed employee salaries, are not considered to be initial direct costs, and may not be capitalized. The ASU is effective for annual and interim periods beginning after December 15, 2018, which for us would be the first quarter of 2019, and early adoption is permitted. The ASU is required to be adopted using a modified retrospective approach which includes optional practical expedients related to leases that commenced before the effective date. We are currently evaluating the impact of this ASU on our financial statements. In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers" (Topic 606), which provides guidance for the accounting of revenue from contracts with customers. The guidance supersedes the revenue recognition requirements in Topic 605, "Revenue Recognition", and most industry-specific guidance throughout the Industry Topics of the Codification. In August 2015, the FASB issued ASU No. 2015-14, which defers the effective date of ASU No. 2014-09 by one year. In March 2016, the FASB issued ASU No. 2016-08, "Principal versus Agent Considerations (Reporting Revenue Gross versus Net)" which amends Topic 606 and clarifies the guidance for principal versus agent considerations. In April 2016, the FASB issued ASU No. 2016-10, "Identifying Performance Obligations and Licensing" which amends Topic 606 and provides guidance for identifying performance obligations and licensing. In May 2016, the FASB issued ASU No. 2016-12, "Narrow-Scope Improvements and Practical Expedients" which amends Topic 606 and provides guidance for a variety of revenue recognition related topics. In February 2017, the FASB issued ASU No. 2017-05 "Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets" (Subtopic 610-20), which provides guidance for recognizing gains and losses from the transfer of nonfinancial assets in contracts with noncustomers. The various ASU's are effective for annual and interim periods beginning after December 15, 2017, which for us is the first quarter of 2018. Earlier application is permitted for annual and interim periods beginning after December 15, 2016, which for us was the first quarter of 2017. The amendments in these ASU's should be applied retrospectively. We are not planning on early adopting the ASU's and we currently evaluating method of adoption. We do not expect the ASU's to have a material impact on our financial statements. The FASB has not issued any other ASUs during 2017 that we expect to be applicable and have a material impact on our financial statements. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Our estimates of the fair value of financial instruments were determined using available market information and widely used valuation methods. Considerable judgment is necessary to interpret market data and determine an estimated fair value. The use of different market assumptions or valuation methods may have a material effect on the estimated fair values. The FASB fair value framework hierarchy distinguishes between assumptions based on market data obtained from sources independent of the reporting entity, and the reporting entity’s own assumptions about market-based inputs. The hierarchy is as follows: Level 1 - inputs utilize unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 - inputs are observable either directly or indirectly for similar assets and liabilities in active markets. Level 3 - inputs are unobservable assumptions generated by the reporting entity |
Overview (Tables)
Overview (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Real Estate Properties | As of September 30, 2017 , our portfolio of properties consisted of the following properties (not including two parcels of land from which we receive rent under ground leases): Consolidated Portfolio Total Portfolio Office (includes ancillary retail space) Wholly-owned properties 52 52 Consolidated JV properties 10 10 Unconsolidated Fund properties — 8 62 70 Multifamily Wholly-owned properties 10 10 Total 72 80 |
Investment in Real Estate (Tabl
Investment in Real Estate (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Santa Monica Properties [Member] | |
Real Estate Acquisition [Line Items] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The table below (in thousands) summarizes our purchase price allocations for the acquisitions. The difference between the contract prices and respective purchase prices below relates to prorations and similar matters: 1299 Ocean 429 Santa Monica 9665 Wilshire Building square footage 206 87 171 Investment in real estate: Land $ 22,748 $ 4,949 $ 5,568 Buildings and improvements 260,188 69,286 175,960 Tenant improvements and lease intangibles 5,010 3,248 1,112 Acquired above and below-market leases, net (10,683 ) (723 ) (4,339 ) Net assets and liabilities acquired $ 277,263 $ 76,760 $ 178,301 |
Westwood Portfolio [Member] | |
Real Estate Acquisition [Line Items] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The table below (in thousands) summarizes our purchase accounting and funding sources for the acquisition: Sources and Uses of Funds Actual at Closing (1) Pro Forma Sell Down Adjustments (2) Pro Forma Building square footage 1,725 1,725 Uses of funds - Investment in real estate: Land $ 94,996 $ 94,996 Buildings and improvements 1,236,786 1,236,786 Tenant improvements and lease intangibles 50,439 50,439 Acquired above and below-market leases, net (3) (49,708 ) (49,708 ) Net assets and liabilities acquired (4) $ 1,332,513 $ 1,332,513 Source of funds: Cash on hand (5) $ 153,745 $ — $ 153,745 Credit facility (6) 290,000 (240,000 ) 50,000 Non-recourse term loan, net (7) 568,768 — 568,768 Noncontrolling interests 320,000 240,000 560,000 Total source of funds $ 1,332,513 $ — $ 1,332,513 ________________________________________________ (1) Reflects the purchase of the Westwood Portfolio on the Acquisition Date when we contributed sixty -percent of the equity to the consolidated JV. (2) Reflects our sale of thirty -percent of the equity in the JV on the Sell Down Date, presented as of the Acquisition Date, treated as in-substance real estate, which reduced our ownership interest in the JV to thirty -percent. We sold the interest for the $240.0 million we contributed plus an additional $1.1 million to compensate us for our costs of holding the investment. We recognized a gain on the sale of $1.1 million . We used the proceeds from the sale to pay down the balance owed on our revolving credit facility. (3) As of the Acquisition Date, the weighted average remaining life of the acquired above-and below-market leases was approximately 4.4 years . (4) The difference between the contract and purchase price related to credits received for prorations and similar matters. (5) Cash paid included a $75.0 million deposit, $67.5 million paid at closing and $11.2 million spent on loan costs in connection with securing the $580.0 million term loan. (6) Reflects borrowings using the Company's credit facility, which bears interest at LIBOR + 1.40% . (7) Reflects 100% (not the Company's pro rata share) of a $580.0 million interest-only non-recourse loan, net of deferred loan costs of $11.2 million incurred to secure the loan. The loan has a seven -year term and is secured by the Westwood Portfolio. Interest on the loan is floating at LIBOR + 1.40% , which has been effectively fixed at 2.37% per annum for five years through interest rate swaps. See Note 7 for information regarding our consolidated debt. |
Revenue and Net Income Attributable to Common Stockholders from the Westwood Portfolio | The table below (in thousands) presents the revenues and net income attributable to common stockholders from the Westwood Portfolio included in the consolidated statement of operations after the Acquisition Date: Nine Months Ended September 30, 2017 2016 Total office revenues $ 71,530 $ 56,045 Net income attributable to common stockholders (1) $ 4,449 $ 1,444 ______________________________________________________ (1) Excluding transaction costs, net income attributable to common stockholders was $4.4 million and $3.5 million for the nine months ended September 30, 2017 and 2016 , respectively. |
Business Acquisition, Pro Forma Information | The table below (in thousands, except per share information) presents the historical results of Douglas Emmett, Inc. and the Westwood Portfolio on a combined basis as if the acquisition was completed on January 1, 2016, based on our thirty -percent ownership interest and includes adjustments that give effect to events that are (i) directly attributable to the acquisition, (ii) expected to have a continuing impact on us, and (iii) are factually supportable. The pro forma reflects the hypothetical impact of the acquisition on us and does not purport to represent what our results of operations would have been had the acquisition occurred on January 1, 2016, or project the results of operations for any future period. The information does not reflect cost savings or operating synergies that may result from the acquisition or the costs to achieve any such potential cost savings or operating synergies. Transaction costs related to the acquisition have been excluded. Nine Months Ended September 30, 2016 Pro forma revenues $ 561,235 Pro forma net income attributable to common stockholders $ 64,623 Pro forma net income attributable to common stockholders per share – basic $ 0.433 Pro forma net income attributable to common stockholders per share – diluted $ 0.421 |
233 Wilshire and 12100 Wilshire Properties [Member] | |
Real Estate Acquisition [Line Items] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The table below (in thousands) summarizes our purchase accounting for the acquisitions. The difference between the contract prices and respective purchase prices relate to credits received for prorations and similar matters: 233 Wilshire 12100 Wilshire Building square footage 129 365 Investment in real estate: Land $ 9,263 $ 20,164 Buildings and improvements 126,938 199,698 Tenant improvements and lease intangibles 3,488 9,057 Acquired above and below-market leases, net (1,838 ) (4,523 ) Net assets and liabilities acquired $ 137,851 $ 224,396 |
Acquired Lease Intangibles (Tab
Acquired Lease Intangibles (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Acquired Lease Intangibles | The table below (in thousands) summarizes our above/below-market leases: September 30, 2017 December 31, 2016 Above-market tenant leases $ 5,461 $ 5,110 Accumulated amortization - above-market tenant leases (3,203 ) (2,379 ) Below-market ground leases 3,198 3,198 Accumulated amortization - below-market ground leases (840 ) (782 ) Acquired lease intangible assets, net $ 4,616 $ 5,147 Below-market tenant leases $ 117,077 $ 104,925 Accumulated accretion - below-market tenant leases (51,433 ) (41,241 ) Above-market ground leases 4,017 16,200 Accumulated accretion - above-market ground leases (547 ) (12,693 ) Acquired lease intangible liabilities, net $ 69,114 $ 67,191 |
Schedule of Net Amortization or Accretion of Above/Below-Market Leases | The table below (in thousands) summarizes the net amortization/accretion related to our above/below-market leases: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Net accretion of above/below-market tenant leases (1) $ 4,805 $ 5,093 $ 13,265 $ 13,390 Amortization of above-market ground lease (2) (4 ) (4 ) (13 ) (13 ) Accretion of above-market ground lease (3) 13 13 38 38 Total $ 4,814 $ 5,102 $ 13,290 $ 13,415 _______________________________________________ (1) Recorded as a net increase to office and multifamily rental revenues. (2) The amortization of the above-market rent we receive under this ground lease is recorded as a decrease to office parking and other income. (3) The accretion of the above-market rent we pay under this ground lease is recorded as a decrease to office expense. |
Investments in Unconsolidated27
Investments in Unconsolidated Real Estate Funds (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Real Estate Investments, Net [Abstract] | |
Summary of Statement of Operations for Investments in Unconsolidated Real Estate Funds and Cash Received from Funds | The table below presents (in thousands) cash distributions received from our Funds: Nine Months Ended September 30, 2017 2016 Operating distributions received $ 4,427 $ 1,356 Capital distributions received 41,965 21,973 Total distributions received $ 46,392 $ 23,329 The tables below present (in thousands) selected financial information for the Funds on a combined basis. The amounts presented represent 100% (not our pro-rata share) of amounts related to the Funds, and are based upon historical acquired book value: September 30, 2017 December 31, 2016 Total assets $ 703,776 $ 690,028 Total liabilities $ 524,968 $ 448,544 Total equity $ 178,808 $ 241,484 Nine Months Ended September 30, 2017 2016 Total revenues $ 56,550 $ 54,104 Operating income $ 14,918 $ 14,235 Net income $ 3,974 $ 6,539 |
Other Assets (Tables)
Other Assets (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Other Assets [Abstract] | |
Schedule of Other Assets | Other assets consisted of the following (in thousands): September 30, 2017 December 31, 2016 Restricted cash $ 121 $ 121 Prepaid expenses 11,481 6,779 Other indefinite-lived intangible 1,988 1,988 Furniture, fixtures and equipment, net 1,078 1,093 Other 2,610 1,933 Total other assets $ 17,278 $ 11,914 |
Secured Notes Payable and Rev29
Secured Notes Payable and Revolving Credit Facility, Net (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Secured Notes Payable and Revolving Credit Facility | The following table summarizes (in thousands) our secured notes payable and revolving credit facility: Description Maturity Date (1) Principal Balance as of September 30, 2017 Principal Balance as of December 31, 2016 Variable Interest Rate Fixed Interest Rate (2) Swap Maturity Date Wholly Owned Subsidiaries Term loan (3) — $ — $ 1,000 — — — Term loan (3) — — 349,933 — — — Fannie Mae loans (3) — — 388,080 — — — Term loan (3) — — 345,759 — — — Term loan (4) 2/1/2019 147,719 149,911 N/A 4.00% — Term loan (4) 6/5/2019 282,019 285,000 N/A 3.85% — Fannie Mae loan 10/1/2019 145,000 145,000 LIBOR + 1.25% N/A — Term loan (5) 4/15/2022 340,000 340,000 LIBOR + 1.40% 2.77% 4/1/2020 Term loan (5) 7/27/2022 180,000 180,000 LIBOR + 1.45% 3.06% 7/1/2020 Term loan (5) 11/1/2022 400,000 400,000 LIBOR + 1.35% 2.64% 11/1/2020 Term loan (5) 6/23/2023 360,000 360,000 LIBOR + 1.55% 2.57% 7/1/2021 Term loan (5) 12/23/2023 220,000 220,000 LIBOR + 1.70% 3.62% 12/23/2021 Term loan (5) 1/1/2024 300,000 300,000 LIBOR + 1.55% 3.46% 1/1/2022 Fannie Mae loan (5) 4/1/2025 102,400 102,400 LIBOR + 1.25% 2.84% 3/1/2020 Fannie Mae loans (5) 12/1/2025 115,000 115,000 LIBOR + 1.25% 2.76% 12/1/2020 Fannie Mae loans (5)(6) 6/1/2027 550,000 — LIBOR + 1.37% 3.51% 6/1/2022 Revolving credit facility (7) 8/21/2020 — — LIBOR + 1.40% N/A — Total Wholly Owned Subsidiary Debt 3,142,138 3,682,083 Consolidated JVs Term loan 7/21/2019 365,500 146,000 LIBOR + 1.55% N/A — Term loan (5) 2/28/2023 580,000 580,000 LIBOR + 1.40% 2.37% 3/1/2021 Total Consolidated Debt (8) 4,087,638 4,408,083 Deferred loan costs, net (38,810 ) (38,546 ) Total Consolidated Debt, net $ 4,048,828 $ 4,369,537 ___________________________________________________ Except as noted below, each loan (including our revolving credit facility) is non-recourse and secured by one or more separate collateral pools consisting of one or more properties, and requires monthly payments of interest only with the outstanding principal due upon maturity. (1) Maturity dates include the effect of extension options. (2) Includes the effect of interest rate swaps and excludes the effect of prepaid loan fees. See Note 9 for details of our interest rate swaps. (3) At September 30, 2017 , this loan had been paid off. (4) Require monthly payments of principal and interest. Principal amortization is based upon a 30 -year amortization schedule. (5) Loan agreement includes a zero-percent LIBOR floor. The corresponding swaps do not include such a floor. (6) Effective rate decreases to 3.16% on November 1, 2017 . (7) $400.0 million revolving credit facility. Unused commitment fees range from 0.15% to 0.20% . (8) See Note 12 for our fair value disclosures. Debt Statistics The following table summarizes (in thousands) our fixed and floating rate debt: Principal Balance as of September 30, 2017 Principal Balance as of December 31, 2016 Aggregate swapped to fixed rate loans $ 3,147,400 $ 2,985,480 Aggregate fixed rate loans 429,738 1,131,603 Aggregate floating rate loans 510,500 291,000 Total Debt $ 4,087,638 $ 4,408,083 The following table summarizes our fixed rate debt statistics: Fixed Rate Debt (fixed under the terms of the loan or a swap) Principal balance (in billions) $3.58 Weighted average remaining life (including extension options) 5.8 years Weighted average remaining fixed interest period 3.3 years Weighted average annual interest rate 3.08% Future Principal Payments At September 30, 2017 , the minimum future principal payments due on our secured notes payable and revolving credit facility, excluding the impact of any maturity extension options, were as follows (in thousands): Twelve months ending September 30: 2018 $ 8,294 2019 786,944 2020 325,000 2021 115,000 2022 640,000 Thereafter 2,212,400 Total future principal payments $ 4,087,638 Loan Costs Deferred loan costs are net of accumulated amortization of $15.9 million and $15.4 million at September 30, 2017 and December 31, 2016 , respectively. The table below presents (in thousands) our loan costs, which are included in Interest Expense in our consolidated statements of operations: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Loan costs expensed $ 163 $ — $ 539 $ 818 Deferred loan cost amortization 2,343 2,227 6,865 5,470 Total $ 2,506 $ 2,227 $ 7,404 $ 6,288 |
Interest Payable, Accounts Pa30
Interest Payable, Accounts Payable and Deferred Revenue (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Accounts Payable and Accrued Liabilities [Abstract] | |
Schedule of Interest Payable, Accounts Payable and Deferred Revenue | Interest payable, accounts payable and deferred revenue consisted of the following (in thousands): September 30, 2017 December 31, 2016 Interest payable $ 9,760 $ 9,561 Accounts payable and accrued liabilities 80,572 36,880 Deferred revenue 28,031 28,788 Total interest payable, accounts payable and deferred revenue $ 118,363 $ 75,229 |
Derivative Contracts (Tables)
Derivative Contracts (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Other Derivatives | As of September 30, 2017 , all of our interest rate swaps, which include the interest rate swaps of our consolidated JVs and our unconsolidated Funds, were designated as cash flow hedges: Number of Interest Rate Swaps Notional (in thousands) Consolidated derivatives (1) 26 $ 3,147,400 Unconsolidated Funds' derivatives (2) 4 $ 510,000 ___________________________________________________ (1) The notional amount includes 100% , not our pro-rata share, of our consolidated JVs' derivatives. (2) The notional amount includes 100% , not our pro-rata share, of our unconsolidated Funds' derivatives. |
Schedule of Derivative Liabilities at Fair Value | The fair value of our interest rate swaps in a liability position were as follows (in thousands): Fair value of derivatives in a liability position (1) September 30, 2017 December 31, 2016 Consolidated derivatives (2) $ 2,636 $ 7,689 Unconsolidated Funds' derivatives (3) $ — $ — __________________________________________________________________________________ (1) Includes accrued interest and excludes adjustments for credit risk. (2) Includes 100% , not our pro-rata share, of our consolidated JVs' derivatives. (3) Our unconsolidated Funds did not have any derivatives in a liability position. |
Schedule of Derivative Assets at Fair Value | The fair value of our interest rate swaps in an asset position were as follows (in thousands): Fair value of derivatives in an asset position (1) September 30, 2017 December 31, 2016 Consolidated derivatives (2) $ 37,258 $ 35,144 Unconsolidated Funds' derivatives (3) $ 4,437 $ 3,724 ___________________________________________________ (1) Includes accrued interest and excludes adjustments for credit risk. (2) Includes 100% , not our pro-rata share, of our consolidated JVs' derivatives. (3) Includes 100% , not our pro-rata share, of our unconsolidated Funds' derivatives. |
Effect of Derivative Instruments on Consolidated Statements of Operations | The table below presents (in thousands) the effect of derivative instruments on our AOCI and statements of operations: Nine Months Ended September 30, 2017 2016 Derivatives Designated as Cash Flow Hedges: Loss recorded in AOCI - consolidated derivatives (1)(5) $ (4,027 ) $ (37,927 ) Gain (loss) recorded in AOCI - unconsolidated Funds' derivatives (2)(5) $ 610 $ (814 ) Loss reclassified from AOCI - consolidated derivatives (3)(5) $ (10,353 ) $ (21,361 ) Loss reclassified from AOCI - unconsolidated Funds' derivatives (4)(5) $ (193 ) $ (311 ) Gain recorded - consolidated derivatives (6) $ 38 $ — Derivatives Not Designated as Cash Flow Hedges: Gain (loss) recorded as interest expense (7) $ — $ — ___________________________________________________ (1) Represents the effective portion of the change in fair value of interest rate swaps. (2) Represents our share of the effective portion of the change in fair value of our unconsolidated Funds' interest rate swaps. (3) Reclassified from AOCI as an increase to Interest expense. (4) Reclassified from AOCI as an increase (decrease) to Income, including depreciation, from unconsolidated real estate funds (our share). (5) See the reconciliation of our AOCI in Note 10 . (6) Represents the ineffective portion of the change in fair value of interest rate swaps, which is recorded as a decrease (increase) to interest expense. Our unconsolidated Funds did not have any ineffectiveness related to their interest rate swaps. (7) We and our unconsolidated Funds do not have any derivatives that are not designated as cash flow hedges. |
Schedule of Future Reclassifications from AOCI | At September 30, 2017 , our estimate of the AOCI related to derivatives, designated as cash flow hedges, that will be reclassified to earnings during the next twelve months as swap interest payments are made, is presented in the table below (in thousands): Consolidated derivatives (1) $ (702 ) Unconsolidated Funds' derivatives (2) $ 772 ________________________________________ (1) Reclassified as an increase to Interest expense. (2) Reclassified as an increase to Income, including depreciation, from unconsolidated real estate funds (our share). |
Equity (Tables)
Equity (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Stockholders' Equity Note [Abstract] | |
Condensed Consolidated Statements of Equity | The tables below present (in thousands) our condensed consolidated statements of equity: DEI Stockholders' Equity Noncontrolling Interests Total Equity Balance as of January 1, 2017 $ 1,921,143 $ 1,092,928 $ 3,014,071 Net income 64,907 7,534 72,441 Cash flow hedge fair value adjustments 7,383 (254 ) 7,129 Contributions to consolidated JVs — 284,248 284,248 Dividends and distributions (111,177 ) (28,682 ) (139,859 ) Exchange of OP units for common stock 13,261 (13,261 ) — Exercise of stock options (1) (52,867 ) — (52,867 ) Stock-based compensation — 8,642 8,642 Sale of common stock, net of offering costs 593,272 — 593,272 Balance as of September 30, 2017 $ 2,435,922 $ 1,351,155 $ 3,787,077 __________________________________________________ (1) Reflects withholding taxes. We issued shares of our common stock for the exercise of stock options on a net settlement basis (net of the exercise price and related taxes). DEI Stockholders' Equity Noncontrolling Interests Total Equity Balance as of January 1, 2016 $ 1,926,211 $ 355,337 $ 2,281,548 Net income 65,696 7,928 73,624 Cash flow hedge fair value adjustments (14,376 ) (2,693 ) (17,069 ) Contributions to consolidated JV — 459,750 459,750 Sale of equity interest in consolidated JV — 291,029 291,029 Dividends and distributions (98,501 ) (26,185 ) (124,686 ) Exchange of OP units for common stock 17,733 (17,733 ) — Repurchase of OP units (498 ) (328 ) (826 ) Exercise of stock options (1) (53,467 ) — (53,467 ) Stock-based compensation — 7,759 7,759 Sale of common stock, net of offering costs 49,379 — 49,379 Balance as of September 30, 2016 $ 1,892,177 $ 1,074,864 $ 2,967,041 __________________________________________________ (1) Reflects withholding taxes. We issued shares of our common stock for the exercise of stock options on a net settlement basis (net of the exercise price and related taxes). |
Net Income Attributable to Common Stockholders and Transfers (to) from Noncontrolling Interests | The table below presents (in thousands) the effect on our equity from net income attributable to common stockholders and changes in our ownership interest in our Operating Partnership: Nine Months Ended September 30, 2017 2016 Net income attributable to common stockholders $ 64,907 $ 65,696 Transfers from noncontrolling interests: Exchange of OP Units with noncontrolling interests 13,261 17,733 Repurchase of OP Units from noncontrolling interests — (498 ) Net transfers from noncontrolling interests 13,261 17,235 Change from net income attributable to common stockholders and transfers from noncontrolling interests $ 78,168 $ 82,931 |
Schedule of Accumulated Other Comprehensive Income (Loss) | The table below presents (in thousands) a reconciliation of our AOCI, which consists solely of adjustments related to derivatives designated as cash flow hedges for the nine months ended September 30 : 2017 2016 Beginning balance $ 15,156 $ (9,285 ) Other comprehensive loss before reclassifications - our derivatives (4,027 ) (37,927 ) Other comprehensive income (loss) before reclassifications - our Funds' derivatives 610 (814 ) Reclassifications from AOCI - our derivatives (2) 10,353 21,361 Reclassifications from AOCI - our Funds' derivatives (3) 193 311 Net current period OCI 7,129 (17,069 ) OCI attributable to noncontrolling interests 254 2,693 OCI attributable to common stockholders 7,383 (14,376 ) Ending balance $ 22,539 $ (23,661 ) ___________________________________________________ (1) See Note 9 for the details of our derivatives and Note 12 for our derivative fair value disclosures. (2) Reclassification as an increase to Interest expense. (3) Reclassification as an (increase) decrease to Income, including depreciation, from unconsolidated real estate funds. |
EPS (Tables)
EPS (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The table below presents the calculation of basic and diluted EPS: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Numerator (in thousands): Net income attributable to common stockholders $ 25,614 $ 31,848 $ 64,907 $ 65,696 Allocation to participating securities: Unvested LTIP Units (158 ) (180 ) (345 ) (365 ) Numerator for basic and diluted net income attributable to common stock holders $ 25,456 $ 31,668 $ 64,562 $ 65,331 Denominator (in thousands): Weighted average shares of common stock outstanding - basic 165,471 150,753 158,000 148,578 Effect of dilutive securities: Stock options (1) 49 2,666 419 4,241 Weighted average shares of common stock and common stock equivalents outstanding - diluted 165,520 153,419 158,419 152,819 Basic EPS: Net income attributable to common stockholders per share $ 0.154 $ 0.210 $ 0.409 $ 0.440 Diluted EPS: Net income attributable to common stockholders per share $ 0.154 $ 0.206 $ 0.408 $ 0.428 ____________________________________________________ (1) The following securities (in thousands) were excluded from the computation of the weighted average shares of common stock and common stock equivalents outstanding - diluted because the effect of including them would be anti-dilutive to the calculation of diluted EPS: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 OP Units 24,790 24,788 24,750 25,148 Vested LTIP Units 8 675 358 766 |
Fair Value of Financial Instr34
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Estimated Fair Value of Secured Notes Payable | The table below presents (in thousands) the estimated fair value of our secured notes payable: Secured Notes Payable: September 30, 2017 December 31, 2016 Fair value $ 4,080,901 $ 4,429,224 Carrying value $ 4,087,638 $ 4,408,083 |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The table below presents (in thousands) the estimated fair value of our derivatives: September 30, 2017 December 31, 2016 Derivative Assets: Fair value - consolidated derivatives (1) $ 37,115 $ 35,656 Fair value - unconsolidated Funds' derivatives (2) $ 4,632 $ 3,605 Derivative Liabilities: Fair value - consolidated derivatives (1) $ 2,002 $ 6,830 Fair value - unconsolidated Funds' derivatives (2) $ — $ — ____________________________________________________ (1) Consolidated derivatives, which include 100% , not our pro-rata share, of our consolidated JVs' derivatives, are included in interest rate contracts in our consolidated balance sheet. The fair value excludes accrued interest which is included in interest payable in the consolidated balance sheet. (2) Represents 100% , not our pro-rata share, of our unconsolidated Funds' derivatives. Our pro-rata share of the amounts related to the unconsolidated Funds' derivatives is included in our Investment in unconsolidated real estate funds in our consolidated balance sheet. See Note 5 for more information regarding our unconsolidated Funds. |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Summary of Operating Activity of Reportable Segments | The table below presents (in thousands) the operating activity of our reportable segments: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Office Segment Total office revenues $ 184,618 $ 167,608 $ 530,508 $ 475,083 Office expenses (62,468 ) (56,926 ) (175,240 ) (158,190 ) Office segment profit 122,150 110,682 355,268 316,893 Multifamily Segment Total multifamily revenues 24,131 24,513 72,354 72,825 Multifamily expenses (6,041 ) (5,950 ) (17,866 ) (17,322 ) Multifamily segment profit 18,090 18,563 54,488 55,503 Total profit from all segments $ 140,240 $ 129,245 $ 409,756 $ 372,396 |
Reconciliation of Segment Profit to Net Income Attributable to Common Stockholders | The table below (in thousands) is a reconciliation of the total profit from all segments to net income attributable to common stockholders: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Total profit from all segments $ 140,240 $ 129,245 $ 409,756 $ 372,396 General and administrative (8,441 ) (8,099 ) (27,189 ) (25,573 ) Depreciation and amortization (69,974 ) (63,827 ) (206,141 ) (181,947 ) Other income 2,659 2,295 7,152 6,527 Other expenses (1,659 ) (2,916 ) (5,156 ) (7,828 ) Income, including depreciation, from unconsolidated real estate funds 1,137 2,334 4,427 5,564 Interest expense (35,454 ) (36,479 ) (110,408 ) (109,842 ) Income before gains 28,508 22,553 72,441 59,297 Gains on sales of investments in real estate — 13,245 — 14,327 Net income 28,508 35,798 72,441 73,624 Less: Net income attributable to noncontrolling interests (2,894 ) (3,950 ) (7,534 ) (7,928 ) Net income attributable to common stockholders $ 25,614 $ 31,848 $ 64,907 $ 65,696 |
Future Minimum Lease Rental R36
Future Minimum Lease Rental Receipts (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Operating Leases, Future Minimum Payments Receivable [Abstract] | |
Schedule of Future Minimum Base Rentals on Non-Cancelable Office and Ground Operating Leases | The table below presents (in thousands) the future minimum base rentals on our non-cancelable office tenant and ground leases at September 30, 2017 : Twelve months ending September 30: 2018 $ 528,867 2019 477,732 2020 416,289 2021 333,742 2022 251,975 Thereafter 657,646 Total future minimum base rentals (1) $ 2,666,251 _____________________________________________________ (1) Does not include (i) residential leases, which typically have a term of one year or less, (ii) holdover rent, (iii) other types of rent such as storage rent and antenna rent, (iv) tenant reimbursements, (v) straight line rent, (vi) amortization/accretion of acquired above/below-market lease intangibles and (vii) percentage rents. The amounts assume that early termination options held by tenants are not exercised. |
Future Minimum Lease Rental P37
Future Minimum Lease Rental Payments (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
Schedule of Future Minimum Ground Lease Payments | The table below (in thousands) presents the future minimum ground lease payments as of September 30, 2017 : Twelve months ending September 30: 2018 $ 733 2019 733 2020 733 2021 733 2022 733 Thereafter 47,094 Total future minimum lease payments (1) $ 50,759 ___________________________________________________ (1) Lease term ends on December 31, 2086 . Ground rent is fixed at $733 thousand per year until February 28, 2019 , and will then reset to the greater of the existing ground rent or market. The table above assumes that the rental payments will continue to be $733 thousand per year after February 28, 2019 . |
Commitments, Contingencies an38
Commitments, Contingencies and Guarantees (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Debt Related to Unconsolidated Funds | The table below summarizes our Funds' debt as of September 30, 2017 . The amounts represent 100% (not our pro-rata share) of amounts related to our Funds: Fund (1) Loan Maturity Date Principal Balance (in millions) Variable Interest Rate Swap Fixed Interest Rate Swap Maturity Date Partnership X (2)(4) 3/1/2023 $ 110.0 LIBOR + 1.40% 2.30% 3/1/2021 Fund X (3)(4)(5) 7/1/2024 400.0 LIBOR + 1.65% 3.44% 7/1/2022 $ 510.0 ___________________________________________________ (1) See Note 5 for more information regarding our unconsolidated Funds. (2) Floating rate term loan, swapped to fixed, which is secured by two properties and requires monthly payments of interest only, with the outstanding principal due upon maturity. As of September 30, 2017 , assuming a zero-percent LIBOR interest rate during the remaining life of the swap, the maximum future payments under the swap agreement were $3.4 million . (3) Floating rate term loan, swapped to fixed, which is secured by six properties and requires monthly payments of interest only, with the outstanding principal due upon maturity. As of September 30, 2017 , assuming a zero-percent LIBOR interest rate during the remaining life of the swap, the maximum future payments under the swap agreement were $34.5 million . (4) Loan agreement includes a zero-percent LIBOR floor. The corresponding swaps do not include such a floor. (5) Loan agreement includes the requirement to purchase an interest rate cap if one month LIBOR equals or exceeds 3.56% for fourteen consecutive days after the related swap matures. |
Overview - Narrative (Details)
Overview - Narrative (Details) $ in Millions | Sep. 30, 2017USD ($) |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable interest entity, assets | $ 8,110 |
Variable interest entity, assets related to real estate held for investment | 7,680 |
Variable interest entity, liabilities | 4,330 |
Variable interest entity, equity | 3,790 |
Variable interest entity, equity, portion attributable to noncontrolling interest | $ 1,350 |
Overview - Schedule of Properti
Overview - Schedule of Properties Portfolio (Details) | Sep. 30, 2017land_parceloffice_property |
Real Estate Properties [Line Items] | |
Number of office properties owned | 70 |
Total properties | 80 |
Wholly Owned Properties [Member] | |
Real Estate Properties [Line Items] | |
Number of office properties owned | 52 |
Number of multifamily properties owned | 10 |
Number of land parcels not included in portfolio | land_parcel | 2 |
Consolidated JV Properties [Member] | |
Real Estate Properties [Line Items] | |
Number of office properties owned | 10 |
Unconsolidated Fund Properties [Member] | |
Real Estate Properties [Line Items] | |
Number of office properties owned | 8 |
Reportable Legal Entities [Member] | |
Real Estate Properties [Line Items] | |
Number of office properties owned | 62 |
Total properties | 72 |
Reportable Legal Entities [Member] | Wholly Owned Properties [Member] | |
Real Estate Properties [Line Items] | |
Number of office properties owned | 52 |
Number of multifamily properties owned | 10 |
Reportable Legal Entities [Member] | Consolidated JV Properties [Member] | |
Real Estate Properties [Line Items] | |
Number of office properties owned | 10 |
Reportable Legal Entities [Member] | Unconsolidated Fund Properties [Member] | |
Real Estate Properties [Line Items] | |
Number of office properties owned | 0 |
Summary of Significant Accoun41
Summary of Significant Accounting Policies - Narrative (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2016USD ($) | |
Accounting Policies [Abstract] | |
Acquisition-related expenses | $ 2.9 |
Investment in Real Estate - Nar
Investment in Real Estate - Narrative (Details) $ in Millions | Jul. 20, 2017USD ($) | Apr. 25, 2017USD ($)property | Feb. 29, 2016USD ($)property | Sep. 30, 2017office_property | Sep. 30, 2016property | Jul. 21, 2016 | May 31, 2016 |
Real Estate Acquisition [Line Items] | |||||||
Number of office properties | office_property | 80 | ||||||
Consolidated JV [Member] | |||||||
Real Estate Acquisition [Line Items] | |||||||
Percentage of equity contributed in joint venture | 20.00% | 55.00% | |||||
Consolidated JV [Member] | Office Building [Member] | |||||||
Real Estate Acquisition [Line Items] | |||||||
Number of office properties | property | 2 | ||||||
Consolidated JV [Member] | Santa Monica Properties [Member] | |||||||
Real Estate Acquisition [Line Items] | |||||||
Contract price | $ | $ 352.8 | ||||||
Consolidated JV [Member] | Santa Monica Properties [Member] | Office Building [Member] | |||||||
Real Estate Acquisition [Line Items] | |||||||
Number of office properties | property | 2 | ||||||
Consolidated JV [Member] | Beverly Hills Property [Member] | |||||||
Real Estate Acquisition [Line Items] | |||||||
Contract price | $ | $ 177 | ||||||
Consolidated JV [Member] | Westwood Portfolio [Member] | |||||||
Real Estate Acquisition [Line Items] | |||||||
Contract price | $ | $ 1,340 | ||||||
Percentage of equity contributed in joint venture | 60.00% | 30.00% | 30.00% | ||||
Consolidated JV [Member] | Westwood Portfolio [Member] | Office Building [Member] | |||||||
Real Estate Acquisition [Line Items] | |||||||
Number of office properties | property | 4 |
Investment in Real Estate - Sum
Investment in Real Estate - Summary of Preliminary Purchase Accounting and Funding Sources for Acquisitions (Details) ft² in Thousands, $ in Thousands | Sep. 27, 2016USD ($) | May 31, 2016USD ($) | Feb. 29, 2016USD ($)ft² | Sep. 30, 2016USD ($)ft² | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($)ft² | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($)ft² | Jul. 20, 2017USD ($)ft² | Apr. 25, 2017USD ($)ft² | Dec. 31, 2016USD ($) | Jul. 21, 2016 |
Source of funds: | ||||||||||||
Credit facility | $ 4,087,638 | $ 4,087,638 | $ 4,408,083 | |||||||||
Long-term debt | 4,048,828 | 4,048,828 | 4,369,537 | |||||||||
Proceeds from sale of interest in joint venture | $ 51,600 | |||||||||||
Gain on sale of investment in real estate | 0 | $ 13,245 | 0 | $ 14,327 | ||||||||
Line of Credit [Member] | Revolving Credit Facility With Maturity Date of August 21, 2020 [Member] | LIBOR [Member] | ||||||||||||
Source of funds: | ||||||||||||
Basis spread | 1.40% | |||||||||||
Secured Debt [Member] | Term Loan With Maturity Date of February 28, 2023 [Member] | ||||||||||||
Source of funds: | ||||||||||||
Credit facility | $ 580,000 | |||||||||||
Loan costs | $ 11,200 | |||||||||||
Percentage of loan | 100.00% | |||||||||||
Debt instrument, term | 7 years | |||||||||||
Fixed interest rate | 2.37% | |||||||||||
Fixed interest rate, term | 5 years | |||||||||||
Secured Debt [Member] | Term Loan With Maturity Date of February 28, 2023 [Member] | LIBOR [Member] | ||||||||||||
Source of funds: | ||||||||||||
Basis spread | 1.40% | |||||||||||
Consolidated JV [Member] | ||||||||||||
Source of funds: | ||||||||||||
Percentage of equity contributed in joint venture | 20.00% | 20.00% | 20.00% | 55.00% | ||||||||
Percentage of joint venture sold | 35.00% | 35.00% | 35.00% | |||||||||
Gain on sale of investment in real estate | $ 587 | |||||||||||
Consolidated JV [Member] | Secured Debt [Member] | Term Loan With Maturity Date of February 28, 2023 [Member] | ||||||||||||
Source of funds: | ||||||||||||
Credit facility | $ 580,000 | $ 580,000 | $ 580,000 | |||||||||
Variable Interest Rate | LIBOR + 1.40% | |||||||||||
Fixed interest rate | 2.37% | 2.37% | ||||||||||
Consolidated JV [Member] | Secured Debt [Member] | Term Loan With Maturity Date of February 28, 2023 [Member] | LIBOR [Member] | ||||||||||||
Source of funds: | ||||||||||||
Basis spread | 1.40% | |||||||||||
1299 Ocean [Member] | Consolidated JV [Member] | ||||||||||||
Real Estate Acquisition [Line Items] | ||||||||||||
Building square footage | ft² | 206 | |||||||||||
Uses of funds - Investment in real estate: | ||||||||||||
Land | $ 22,748 | |||||||||||
Buildings and improvements | 260,188 | |||||||||||
Tenant improvements and lease intangibles | 5,010 | |||||||||||
Acquired above and below-market leases, net(3) | (10,683) | |||||||||||
Net assets and liabilities acquired | $ 277,263 | |||||||||||
429 Santa Monica [Member] | Consolidated JV [Member] | ||||||||||||
Real Estate Acquisition [Line Items] | ||||||||||||
Building square footage | ft² | 87 | |||||||||||
Uses of funds - Investment in real estate: | ||||||||||||
Land | $ 4,949 | |||||||||||
Buildings and improvements | 69,286 | |||||||||||
Tenant improvements and lease intangibles | 3,248 | |||||||||||
Acquired above and below-market leases, net(3) | (723) | |||||||||||
Net assets and liabilities acquired | $ 76,760 | |||||||||||
9665 Wilshire [Member] | Consolidated JV [Member] | ||||||||||||
Real Estate Acquisition [Line Items] | ||||||||||||
Building square footage | ft² | 171 | |||||||||||
Uses of funds - Investment in real estate: | ||||||||||||
Land | $ 5,568 | |||||||||||
Buildings and improvements | 175,960 | |||||||||||
Tenant improvements and lease intangibles | 1,112 | |||||||||||
Acquired above and below-market leases, net(3) | (4,339) | |||||||||||
Net assets and liabilities acquired | $ 178,301 | |||||||||||
Westwood Portfolio [Member] | ||||||||||||
Source of funds: | ||||||||||||
Proceeds from sale of interest in joint venture | $ 240,000 | |||||||||||
Additional proceeds for compensation of costs | 1,100 | |||||||||||
Gain on sale of investment in real estate | $ 1,100 | |||||||||||
Weighted average useful live of above and below market leases | 4 years 5 months | |||||||||||
Deposits in escrow | $ 75,000 | |||||||||||
Cash paid at closing | $ 67,500 | |||||||||||
Westwood Portfolio [Member] | Consolidated JV [Member] | ||||||||||||
Real Estate Acquisition [Line Items] | ||||||||||||
Building square footage | ft² | 1,725 | |||||||||||
Uses of funds - Investment in real estate: | ||||||||||||
Land | $ 94,996 | |||||||||||
Buildings and improvements | 1,236,786 | |||||||||||
Tenant improvements and lease intangibles | 50,439 | |||||||||||
Acquired above and below-market leases, net(3) | (49,708) | |||||||||||
Net assets and liabilities acquired | 1,332,513 | |||||||||||
Source of funds: | ||||||||||||
Cash on hand | 153,745 | |||||||||||
Noncontrolling interests | 320,000 | |||||||||||
Total source of funds | $ 1,332,513 | |||||||||||
Percentage of equity contributed in joint venture | 30.00% | 60.00% | 30.00% | 30.00% | 30.00% | |||||||
Percentage of joint venture sold | 30.00% | |||||||||||
Westwood Portfolio [Member] | Consolidated JV [Member] | Line of Credit [Member] | ||||||||||||
Source of funds: | ||||||||||||
Credit facility | $ 290,000 | |||||||||||
Westwood Portfolio [Member] | Consolidated JV [Member] | Secured Debt [Member] | ||||||||||||
Source of funds: | ||||||||||||
Long-term debt | $ 568,768 | |||||||||||
Westwood Portfolio [Member] | Consolidated JV [Member] | Pro Forma Sell Down Adjustment [Member] | ||||||||||||
Source of funds: | ||||||||||||
Noncontrolling interests | $ 240,000 | |||||||||||
Westwood Portfolio [Member] | Consolidated JV [Member] | Pro Forma Sell Down Adjustment [Member] | Line of Credit [Member] | ||||||||||||
Source of funds: | ||||||||||||
Credit facility | $ (240,000) | |||||||||||
Westwood Portfolio [Member] | Consolidated JV [Member] | Pro Forma [Member] | ||||||||||||
Real Estate Acquisition [Line Items] | ||||||||||||
Building square footage | ft² | 1,725 | 1,725 | 1,725 | |||||||||
Uses of funds - Investment in real estate: | ||||||||||||
Land | $ 94,996 | $ 94,996 | $ 94,996 | |||||||||
Buildings and improvements | 1,236,786 | 1,236,786 | 1,236,786 | |||||||||
Tenant improvements and lease intangibles | 50,439 | 50,439 | 50,439 | |||||||||
Acquired above and below-market leases, net(3) | (49,708) | (49,708) | (49,708) | |||||||||
Net assets and liabilities acquired | 1,332,513 | 1,332,513 | 1,332,513 | |||||||||
Source of funds: | ||||||||||||
Cash on hand | 153,745 | |||||||||||
Noncontrolling interests | 560,000 | |||||||||||
Total source of funds | 1,332,513 | |||||||||||
Westwood Portfolio [Member] | Consolidated JV [Member] | Pro Forma [Member] | Line of Credit [Member] | ||||||||||||
Source of funds: | ||||||||||||
Credit facility | 50,000 | 50,000 | 50,000 | |||||||||
Westwood Portfolio [Member] | Consolidated JV [Member] | Pro Forma [Member] | Secured Debt [Member] | ||||||||||||
Source of funds: | ||||||||||||
Long-term debt | $ 568,768 | $ 568,768 | $ 568,768 |
Investment in Real Estate - Rev
Investment in Real Estate - Revenue and Net Income Attributable to Common Stockholders from Westwood Portfolio (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Real Estate Acquisition [Line Items] | ||||
Total office revenues | $ 184,618 | $ 167,608 | $ 530,508 | $ 475,083 |
Net income attributable to common stockholders(1) | $ 25,614 | $ 31,848 | 64,907 | 65,696 |
Westwood Portfolio [Member] | ||||
Real Estate Acquisition [Line Items] | ||||
Total office revenues | 71,530 | 56,045 | ||
Net income attributable to common stockholders(1) | 4,449 | 1,444 | ||
Net income attributable to common stockholders excluding transaction costs | $ 4,400 | $ 3,500 |
Investment in Real Estate - Pro
Investment in Real Estate - Pro Forma Results (Details) - Westwood Portfolio [Member] $ / shares in Units, $ in Thousands | 9 Months Ended |
Sep. 30, 2016USD ($)$ / shares | |
Real Estate Acquisition [Line Items] | |
Pro forma revenues | $ | $ 561,235 |
Pro forma net income attributable to common stockholders | $ | $ 64,623 |
Pro forma net income attributable to common stockholders per share – basic (usd per share) | $ / shares | $ 0.433 |
Pro forma net income attributable to common stockholders per share – diluted (usd per share) | $ / shares | $ 0.421 |
Investment in Real Estate - Oth
Investment in Real Estate - Other 2016 Acquisitions (Details) - Consolidated JV [Member] ft² in Thousands, $ in Thousands | Sep. 27, 2016USD ($)ft² | Jul. 21, 2016USD ($)ft² |
233 Wilshire Boulevard [Member] | ||
Real Estate Acquisition [Line Items] | ||
Building square footage | ft² | 129 | |
Land | $ 9,263 | |
Buildings and improvements | 126,938 | |
Tenant improvements and lease intangibles | 3,488 | |
Acquired above and below-market leases, net | (1,838) | |
Net assets and liabilities acquired | $ 137,851 | |
12100 Wilshire Boulevard [Member] | ||
Real Estate Acquisition [Line Items] | ||
Building square footage | ft² | 365 | |
Land | $ 20,164 | |
Buildings and improvements | 199,698 | |
Tenant improvements and lease intangibles | 9,057 | |
Acquired above and below-market leases, net | (4,523) | |
Net assets and liabilities acquired | $ 224,396 |
Investment in Real Estate - O47
Investment in Real Estate - Other 2016 Acquisitions and Dispositions Narrative (Details) ft² in Thousands, $ in Thousands | Sep. 30, 2016USD ($)ft²property | Sep. 27, 2016USD ($)ft² | Jul. 21, 2016USD ($)ft² | Sep. 30, 2016USD ($)ft²property | Sep. 30, 2017USD ($)office_property | Sep. 30, 2016USD ($)ft²property | Sep. 30, 2017USD ($)office_property | Sep. 30, 2016USD ($)ft²property |
Real Estate Acquisition [Line Items] | ||||||||
Number of office properties | office_property | 80 | 80 | ||||||
Proceeds from sale of interest in joint venture | $ 51,600 | |||||||
Proceeds from sale of interest in real estate held for investment, compensation | $ 194 | |||||||
Gain on sale of investment in real estate | $ 0 | $ 13,245 | $ 0 | $ 14,327 | ||||
Sherman Oaks [Member] | Office Building [Member] | ||||||||
Real Estate Acquisition [Line Items] | ||||||||
Gain on sale of investment in real estate | $ 12,700 | |||||||
Building square footage | ft² | 168 | 168 | 168 | 168 | ||||
Real estate held-for-sale, carrying value | $ 42,800 | $ 42,800 | $ 42,800 | $ 42,800 | ||||
Sale of real estate | 56,700 | |||||||
Sale of real estate, transaction costs | $ 1,200 | |||||||
Investor [Member] | ||||||||
Real Estate Acquisition [Line Items] | ||||||||
Joint venture, contributions received | $ 139,800 | |||||||
Investors ownership percentage in joint venture | 80.00% | |||||||
Consolidated JV [Member] | ||||||||
Real Estate Acquisition [Line Items] | ||||||||
Percentage of equity contributed in joint venture | 20.00% | 55.00% | 20.00% | 20.00% | 20.00% | |||
Percentage of joint venture sold | 35.00% | 35.00% | 35.00% | 35.00% | ||||
Gain on sale of investment in real estate | $ 587 | |||||||
Consolidated JV [Member] | Office Building [Member] | ||||||||
Real Estate Acquisition [Line Items] | ||||||||
Number of office properties | property | 2 | 2 | 2 | 2 | ||||
Consolidated JV [Member] | Secured Debt [Member] | Term Loan With Maturity Date of July 21, 2019 [Member] | ||||||||
Real Estate Acquisition [Line Items] | ||||||||
Proceeds from non-recourse loan | $ 146,000 | |||||||
Debt instrument, term | 3 years | |||||||
Variable interest rate | LIBOR + 1.55% | |||||||
Consolidated JV [Member] | Secured Debt [Member] | Term Loan With Maturity Date of July 21, 2019 [Member] | LIBOR [Member] | ||||||||
Real Estate Acquisition [Line Items] | ||||||||
Basis spread | 1.55% | 1.55% | ||||||
12100 Wilshire Boulevard [Member] | Consolidated JV [Member] | ||||||||
Real Estate Acquisition [Line Items] | ||||||||
Contract price | $ 225,000 | |||||||
Building square footage | ft² | 365 | |||||||
233 Wilshire Boulevard [Member] | Consolidated JV [Member] | ||||||||
Real Estate Acquisition [Line Items] | ||||||||
Contract price | $ 139,500 | |||||||
Building square footage | ft² | 129 |
Acquired Lease Intangibles - Su
Acquired Lease Intangibles - Summary of Acquired Lease Intangibles (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Acquired lease intangible assets, net | $ 4,616 | $ 4,616 | $ 5,147 | ||
Acquired lease intangible liabilities, net | 69,114 | 69,114 | 67,191 | ||
Amortization/accretion of above/below-market leases | 4,814 | $ 5,102 | 13,290 | $ 13,415 | |
Above Market Tenant Leases [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Off-market lease, assets | 5,461 | 5,461 | 5,110 | ||
Accumulated amortization | (3,203) | (3,203) | (2,379) | ||
Below Market Ground Leases [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Off-market lease, assets | 3,198 | 3,198 | 3,198 | ||
Accumulated amortization | (840) | (840) | (782) | ||
Below Market Tenant Leases [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Off-market lease, liabilities | 117,077 | 117,077 | 104,925 | ||
Accumulated accretion | (51,433) | (51,433) | (41,241) | ||
Tenant Lease [Member] | Operating Lease Revenue [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Amortization/accretion of above/below-market leases | 4,805 | 5,093 | 13,265 | 13,390 | |
Above Market Ground Leases [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Off-market lease, liabilities | 4,017 | 4,017 | 16,200 | ||
Accumulated accretion | (547) | (547) | $ (12,693) | ||
Above Market Ground Leases [Member] | Office Parking and Other Income [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Amortization/accretion of above/below-market leases | (4) | (4) | (13) | (13) | |
Above Market Ground Leases [Member] | Office Expense [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Amortization/accretion of above/below-market leases | $ 13 | $ 13 | $ 38 | $ 38 |
Investments in Unconsolidated49
Investments in Unconsolidated Real Estate Funds - Narrative (Details) ft² in Millions | 3 Months Ended | 9 Months Ended |
Jun. 30, 2017 | Sep. 30, 2017ft²office_propertyNumber_of_funds_managed | |
Schedule of Equity Method Investments [Line Items] | ||
Number of office properties | 80 | |
Percentage of amounts related to the Fund | 100.00% | |
Opportunity Fund [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Purchase of equity interest, percent | 3.70% | |
Equity interest of the Fund, percent | 3.70% | |
Fund X [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity interest of the Fund, percent | 69.10% | |
Fund X Indirect [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity interest of the Fund, percent | 13.10% | |
Partnership X [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity interest of the Fund, percent | 24.30% | |
Unconsolidated Properties [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Number of real estate funds owned and managed | Number_of_funds_managed | 3 | |
Number of office properties | 8 | |
Building square footage | ft² | 1.8 |
Investments in Unconsolidated50
Investments in Unconsolidated Real Estate Funds - Summary of Cash Distributions Received from Funds (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Real Estate Investments, Net [Abstract] | ||
Operating distributions received | $ 4,427 | $ 1,356 |
Capital distributions received | 41,965 | 21,973 |
Total distributions received | $ 46,392 | $ 23,329 |
Investments in Unconsolidated51
Investments in Unconsolidated Real Estate Funds - Summary of Statement of Financial Position for Investments in Unconsolidated Real Estate Funds (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Real Estate Investments, Net [Abstract] | ||
Total assets | $ 703,776 | $ 690,028 |
Total liabilities | 524,968 | 448,544 |
Total equity | $ 178,808 | $ 241,484 |
Investments in Unconsolidated52
Investments in Unconsolidated Real Estate Funds - Summary of Statement of Operations for Investments in Unconsolidated Real Estate Funds (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Real Estate Investments, Net [Abstract] | ||
Total revenues | $ 56,550 | $ 54,104 |
Operating income | 14,918 | 14,235 |
Net income | $ 3,974 | $ 6,539 |
Other Assets - Summary of Other
Other Assets - Summary of Other Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Other Assets [Abstract] | ||
Restricted cash | $ 121 | $ 121 |
Prepaid expenses | 11,481 | 6,779 |
Other indefinite-lived intangible | 1,988 | 1,988 |
Furniture, fixtures and equipment, net | 1,078 | 1,093 |
Other | 2,610 | 1,933 |
Total other assets | $ 17,278 | $ 11,914 |
Secured Notes Payable and Rev54
Secured Notes Payable and Revolving Credit Facility, Net - Schedule of Secured Notes Payable and Revolving Credit Facility (Details) - USD ($) | Feb. 29, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Nov. 01, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | |||||
Principal Balance | $ 4,087,638,000 | $ 4,408,083,000 | |||
Deferred loan costs, net | (38,810,000) | (38,546,000) | |||
Total Debt, Net | 4,048,828,000 | 4,369,537,000 | |||
Revolving Credit Facility With Maturity Date of August 21, 2020 [Member] | |||||
Debt Instrument [Line Items] | |||||
Maximum borrowing capacity | $ 400,000,000 | ||||
Revolving Credit Facility With Maturity Date of August 21, 2020 [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Unused commitment fees (as a percent) | 0.15% | ||||
Revolving Credit Facility With Maturity Date of August 21, 2020 [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Unused commitment fees (as a percent) | 0.20% | ||||
Secured Debt [Member] | LIBOR [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 0.00% | ||||
Secured Debt [Member] | Term Loans With Effective Annual Fixed Interest Rate At 4.00% And 3.85% [Member] | |||||
Debt Instrument [Line Items] | |||||
Fixed rate debt amortization period | 30 years | ||||
Secured Debt [Member] | Term Loan With Maturity Date of February 28, 2023 [Member] | |||||
Debt Instrument [Line Items] | |||||
Principal Balance | $ 580,000,000 | ||||
Fixed interest rate | 2.37% | ||||
Secured Debt [Member] | Term Loan With Maturity Date of February 28, 2023 [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.40% | ||||
Line of Credit [Member] | Revolving Credit Facility With Maturity Date of August 21, 2020 [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.40% | ||||
Wholly Owned Subsidiaries [Member] | |||||
Debt Instrument [Line Items] | |||||
Principal Balance | $ 3,142,138,000 | 3,682,083,000 | |||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 3.00% [Member] | |||||
Debt Instrument [Line Items] | |||||
Principal Balance | 0 | 1,000,000 | |||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 4.14% [Member] | |||||
Debt Instrument [Line Items] | |||||
Principal Balance | 0 | 349,933,000 | |||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Fannie Mae Loans With Maturity Date of November 1, 2020 [Member] | |||||
Debt Instrument [Line Items] | |||||
Principal Balance | 0 | 388,080,000 | |||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 4.46% [Member] | |||||
Debt Instrument [Line Items] | |||||
Principal Balance | $ 0 | 345,759,000 | |||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 4.00% [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Feb. 1, 2019 | ||||
Principal Balance | $ 147,719,000 | 149,911,000 | |||
Fixed interest rate | 4.00% | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 3.85% [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Jun. 5, 2019 | ||||
Principal Balance | $ 282,019,000 | 285,000,000 | |||
Fixed interest rate | 3.85% | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Fannie Mae Loan With Maturity Date of October 1, 2019 [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Oct. 1, 2019 | ||||
Principal Balance | $ 145,000,000 | 145,000,000 | |||
Variable Interest Rate | LIBOR + 1.25% | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Fannie Mae Loan With Maturity Date of October 1, 2019 [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.25% | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 2.77% [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Apr. 15, 2022 | ||||
Principal Balance | $ 340,000,000 | 340,000,000 | |||
Variable Interest Rate | LIBOR + 1.40% | ||||
Fixed interest rate | 2.77% | ||||
Swap Maturity Date | Apr. 1, 2020 | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 2.77% [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.40% | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 3.06% [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Jul. 27, 2022 | ||||
Principal Balance | $ 180,000,000 | 180,000,000 | |||
Variable Interest Rate | LIBOR + 1.45% | ||||
Fixed interest rate | 3.06% | ||||
Swap Maturity Date | Jul. 1, 2020 | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 3.06% [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.45% | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 2.64% [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Nov. 1, 2022 | ||||
Principal Balance | $ 400,000,000 | 400,000,000 | |||
Variable Interest Rate | LIBOR + 1.35% | ||||
Fixed interest rate | 2.64% | ||||
Swap Maturity Date | Nov. 1, 2020 | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 2.64% [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.35% | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 2.57% [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Jun. 23, 2023 | ||||
Principal Balance | $ 360,000,000 | 360,000,000 | |||
Variable Interest Rate | LIBOR + 1.55% | ||||
Fixed interest rate | 2.57% | ||||
Swap Maturity Date | Jul. 1, 2021 | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 2.57% [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.55% | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 3.62% [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Dec. 23, 2023 | ||||
Principal Balance | $ 220,000,000 | 220,000,000 | |||
Variable Interest Rate | LIBOR + 1.70% | ||||
Fixed interest rate | 3.62% | ||||
Swap Maturity Date | Dec. 23, 2021 | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 3.62% [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.70% | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 3.46% [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Jan. 1, 2024 | ||||
Principal Balance | $ 300,000,000 | 300,000,000 | |||
Variable Interest Rate | LIBOR + 1.55% | ||||
Fixed interest rate | 3.46% | ||||
Swap Maturity Date | Jan. 1, 2022 | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Term Loan With Effective Annual Fixed Interest Rate At 3.46% [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.55% | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Fannie Mae Loan With Maturity Date of April 1, 2025 [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Apr. 1, 2025 | ||||
Principal Balance | $ 102,400,000 | 102,400,000 | |||
Variable Interest Rate | LIBOR + 1.25% | ||||
Fixed interest rate | 2.84% | ||||
Swap Maturity Date | Mar. 1, 2020 | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Fannie Mae Loan With Maturity Date of April 1, 2025 [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.25% | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Fannie Mae Loans With Maturity Date of December 1, 2025 [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Dec. 1, 2025 | ||||
Principal Balance | $ 115,000,000 | 115,000,000 | |||
Variable Interest Rate | LIBOR + 1.25% | ||||
Fixed interest rate | 2.76% | ||||
Swap Maturity Date | Dec. 1, 2020 | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Fannie Mae Loans With Maturity Date of December 1, 2025 [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.25% | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Fannie Mae Loans With Maturity Date of June 1, 2027 [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Jun. 1, 2027 | ||||
Principal Balance | $ 550,000,000 | 0 | |||
Variable Interest Rate | LIBOR + 1.37% | ||||
Fixed interest rate | 3.51% | ||||
Swap Maturity Date | Jun. 1, 2022 | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Fannie Mae Loans With Maturity Date of June 1, 2027 [Member] | Forecast [Member] | |||||
Debt Instrument [Line Items] | |||||
Fixed interest rate | 3.16% | ||||
Wholly Owned Subsidiaries [Member] | Secured Debt [Member] | Fannie Mae Loans With Maturity Date of June 1, 2027 [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.37% | ||||
Wholly Owned Subsidiaries [Member] | Line of Credit [Member] | Revolving Credit Facility With Maturity Date of August 21, 2020 [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Aug. 21, 2020 | ||||
Principal Balance | $ 0 | 0 | |||
Variable Interest Rate | LIBOR + 1.40% | ||||
Wholly Owned Subsidiaries [Member] | Line of Credit [Member] | Revolving Credit Facility With Maturity Date of August 21, 2020 [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.40% | ||||
Consolidated JV [Member] | Secured Debt [Member] | Term Loan With Maturity Date of July 21, 2019 [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Jul. 21, 2019 | ||||
Principal Balance | $ 365,500,000 | 146,000,000 | |||
Variable Interest Rate | LIBOR + 1.55% | ||||
Consolidated JV [Member] | Secured Debt [Member] | Term Loan With Maturity Date of July 21, 2019 [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.55% | 1.55% | |||
Consolidated JV [Member] | Secured Debt [Member] | Term Loan With Maturity Date of February 28, 2023 [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity Date | Feb. 28, 2023 | ||||
Principal Balance | $ 580,000,000 | $ 580,000,000 | |||
Variable Interest Rate | LIBOR + 1.40% | ||||
Fixed interest rate | 2.37% | ||||
Swap Maturity Date | Mar. 1, 2021 | ||||
Consolidated JV [Member] | Secured Debt [Member] | Term Loan With Maturity Date of February 28, 2023 [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread | 1.40% |
Secured Notes Payable and Rev55
Secured Notes Payable and Revolving Credit Facility, Net - Schedule of Debt Statistics (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Debt Disclosure [Abstract] | ||
Principal balance of consolidated fixed rate debt | $ 3,580,000 | |
Weighted average remaining life (including extension options) of consolidated fixed rate debt (in years) | 5 years 10 months | |
Weighted average remaining fixed interest period of consolidated fixed rate debt (in years) | 3 years 4 months | |
Weighted average annual interest rate of consolidated fixed rate debt (as a percent) | 3.08% | |
Debt Instrument [Line Items] | ||
Principal Balance | $ 4,087,638 | $ 4,408,083 |
Aggregate Swapped to Fixed Rate Loans [Member] | ||
Debt Instrument [Line Items] | ||
Principal Balance | 3,147,400 | 2,985,480 |
Aggregate Fixed Rate Loans [Member] | ||
Debt Instrument [Line Items] | ||
Principal Balance | 429,738 | 1,131,603 |
Aggregate Floating Rate Loans [Member] | ||
Debt Instrument [Line Items] | ||
Principal Balance | $ 510,500 | $ 291,000 |
Secured Notes Payable and Rev56
Secured Notes Payable and Revolving Credit Facility, Net - Schedule of Minimum Future Principal Payments (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Debt Disclosure [Abstract] | ||
2,018 | $ 8,294 | |
2,019 | 786,944 | |
2,020 | 325,000 | |
2,021 | 115,000 | |
2,022 | 640,000 | |
Thereafter | 2,212,400 | |
Total future principal payments | $ 4,087,638 | $ 4,408,083 |
Secured Notes Payable and Rev57
Secured Notes Payable and Revolving Credit Facility, Net - Schedule of Loan Costs and Accumulated Amortization (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |||||
Accumulated amortization on deferred loan costs | $ 15,900 | $ 15,900 | $ 15,400 | ||
Loan Costs Included In Interest Expense | |||||
Deferred loan cost amortization | 6,865 | $ 5,470 | |||
Interest Expense [Member] | |||||
Loan Costs Included In Interest Expense | |||||
Loan costs expensed | 163 | $ 0 | 539 | 818 | |
Deferred loan cost amortization | 2,343 | 2,227 | 6,865 | 5,470 | |
Total | $ 2,506 | $ 2,227 | $ 7,404 | $ 6,288 |
Interest Payable, Accounts Pa58
Interest Payable, Accounts Payable and Deferred Revenue - Summary of Balances (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Accounts Payable and Accrued Liabilities [Abstract] | ||
Interest payable | $ 9,760 | $ 9,561 |
Accounts payable and accrued liabilities | 80,572 | 36,880 |
Deferred revenue | 28,031 | 28,788 |
Total interest payable, accounts payable and deferred revenue | $ 118,363 | $ 75,229 |
Derivative Contracts - Summary
Derivative Contracts - Summary of Derivatives (Details) - Interest Rate Swap [Member] - Derivatives Designated as Cash Flow Hedges [Member] - Cash Flow Hedging [Member] $ in Thousands | Sep. 30, 2017USD ($)instrument |
Derivative [Line Items] | |
Number of Interest Rate Swaps | instrument | 26 |
Notional | $ | $ 3,147,400 |
Percent of notional amount related to the Fund | 100.00% |
Unconsolidated Funds [Member] | |
Derivative [Line Items] | |
Number of Interest Rate Swaps | instrument | 4 |
Notional | $ | $ 510,000 |
Percent of notional amount related to the Fund | 100.00% |
Derivative Contracts - Credit-r
Derivative Contracts - Credit-risk-related Contingent Features (Details) - Interest Rate Swap [Member] - Derivatives Designated as Cash Flow Hedges [Member] - Cash Flow Hedging [Member] - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value derivatives in a liability position | $ 2,636 | $ 7,689 |
Percent of notional amount related to the Fund | 100.00% | |
Unconsolidated Funds [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value derivatives in a liability position | $ 0 | $ 0 |
Percent of notional amount related to the Fund | 100.00% |
Derivative Contracts - Counterp
Derivative Contracts - Counterparty Credit Risk (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value of derivatives in an asset position | $ 37,115 | $ 35,656 |
Interest Rate Swap [Member] | Derivatives Designated as Cash Flow Hedges [Member] | Cash Flow Hedging [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value of derivatives in an asset position | $ 37,258 | 35,144 |
Percent of notional amount related to the Fund | 100.00% | |
Interest Rate Swap [Member] | Derivatives Designated as Cash Flow Hedges [Member] | Cash Flow Hedging [Member] | Unconsolidated Funds [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value of derivatives in an asset position | $ 4,437 | $ 3,724 |
Percent of notional amount related to the Fund | 100.00% |
Derivative Contracts - Impact o
Derivative Contracts - Impact of Hedges on AOCI and Statements of Operations (Details) - Cash Flow Hedging [Member] - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Derivatives Designated as Cash Flow Hedges [Member] | ||
Derivative [Line Items] | ||
Gain (loss) recorded in AOCI | $ (4,027) | $ (37,927) |
Gain (loss) reclassified from AOCI | (10,353) | (21,361) |
Derivatives Designated as Cash Flow Hedges [Member] | Interest Expense [Member] | ||
Derivative [Line Items] | ||
Gain recorded | 38 | 0 |
Derivatives Designated as Cash Flow Hedges [Member] | Unconsolidated Funds [Member] | ||
Derivative [Line Items] | ||
Gain (loss) recorded in AOCI | 610 | (814) |
Gain (loss) reclassified from AOCI | (193) | (311) |
Derivatives Not Designated as Cash Flow Hedges [Member] | Interest Expense [Member] | ||
Derivative [Line Items] | ||
Gain (loss) recorded as interest expense | $ 0 | $ 0 |
Derivative Contracts - Future R
Derivative Contracts - Future Reclassifications from AOCI (Details) $ in Thousands | Sep. 30, 2017USD ($) |
Derivative Instruments, Gain (Loss) [Line Items] | |
Derivative designated as cash flow hedge to be reclassified | $ (702) |
Unconsolidated Funds [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Derivative designated as cash flow hedge to be reclassified | $ 772 |
Equity - Narrative (Details)
Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Schedule of Equity Method Investments [Line Items] | ||||
Number of operating partnership units converted to shares of common stock (shares) | 986,000 | 1,300,000 | ||
Shares of common stock issued for exercise of stock options (shares) | 1,300,000 | 1,500,000 | ||
Number of stock options exercised (shares) | 3,900,000 | 7,600,000 | ||
Shares of common stock sold (shares) | 15,700,000 | 1,400,000 | ||
Net proceeds from common stock issued | $ 593,300 | $ 49,400 | ||
Number of operating partnership units redeemed for cash (shares) | 25,000 | |||
Aggregate purchase price for redemption of operating partnership units | $ 826 | |||
Average price of units (usd per share) | $ 33.05 | |||
Common stock, shares outstanding (in shares) | 169,487,292 | 151,530,210 | ||
Number of OP units and fully-vested LTIP units outstanding | 24,700,000 | |||
Number of shares of common stock issued upon redemption of one OP unit (shares) | 1 | |||
Partnership Interest [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Investors' ownership in joint venture (percent) | 13.00% | |||
Westwood Portfolio [Member] | Investor [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Investors' ownership in joint venture (percent) | 70.00% | 70.00% | ||
Investors' contribution to joint venture | $ 320,000 | $ 320,000 | ||
Investors' ownership acquired during period with direct investment (percent) | 40.00% | |||
Westwood Portfolio [Member] | Corporate Joint Venture [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Percentage of joint venture sold | 30.00% | 30.00% | ||
Proceeds from divestiture of partial interest in joint venture | $ 241,100 | |||
Gain on sale of interest in joint venture | $ 1,100 | |||
Third Quarter Acquisitions [Member] | Investor [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Investors' ownership in joint venture (percent) | 80.00% | 80.00% | ||
Investors' contribution to joint venture | $ 139,800 | $ 139,800 | ||
Third Quarter Acquisitions [Member] | Corporate Joint Venture [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Percentage of joint venture sold | 35.00% | 35.00% | ||
Proceeds from divestiture of partial interest in joint venture | $ 51,600 | |||
Gain on sale of interest in joint venture | $ 587 |
Equity - Condensed Consolidated
Equity - Condensed Consolidated Statements of Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Douglas Emmett, Inc. Stockholders' Equity, Beginning Balance | $ 1,921,143 | |||
Noncontrolling Interests, Beginning Balance | 1,092,928 | |||
Total Equity, Beginning Balance | 3,014,071 | $ 2,281,548 | ||
Net income attributable to common stockholders | $ 25,614 | $ 31,848 | 64,907 | 65,696 |
Noncontrolling Interests, Net Income | 2,894 | 3,950 | 7,534 | 7,928 |
Net income | 28,508 | 35,798 | 72,441 | 73,624 |
Cash flow hedge fair value adjustment, total equity | 1,493 | 18,429 | 7,129 | (17,069) |
Contributions to consolidated JVs | 284,248 | 459,750 | ||
Sale of equity interest in consolidated JV | 291,029 | |||
Dividends and distributions, Douglas Emmett, Inc. Stockholders' Equity | (111,177) | (98,501) | ||
Dividends and distributions, total equity | (139,859) | (124,686) | ||
Exchange of OP units for common stock | 0 | 0 | ||
Repurchase of OP units | (826) | |||
Exercise of stock options(1) | (52,867) | (53,467) | ||
Stock-based compensation, total equity | 8,642 | 7,759 | ||
Sale of common stock, net of offering costs | 593,272 | 49,379 | ||
Douglas Emmett, Inc. Stockholders' Equity, Ending Balance | 2,435,922 | 2,435,922 | ||
Noncontrolling Interests, Ending Balance | 1,351,155 | 1,351,155 | ||
Total Equity, Ending Balance | 3,787,077 | 2,967,041 | 3,787,077 | 2,967,041 |
Douglas Emmett Inc Stockholders' Equity [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Douglas Emmett, Inc. Stockholders' Equity, Beginning Balance | 1,921,143 | 1,926,211 | ||
Net income attributable to common stockholders | 64,907 | 65,696 | ||
Cash flow hedge fair value adjustment, Douglas Emmett, Inc. Stockholders' Equity | 7,383 | (14,376) | ||
Contributions to consolidated JVs | 0 | 0 | ||
Sale of equity interest in consolidated JV | 0 | |||
Dividends and distributions, Douglas Emmett, Inc. Stockholders' Equity | (111,177) | (98,501) | ||
Exchange of OP units for common stock | 13,261 | 17,733 | ||
Repurchase of OP units | (498) | |||
Exercise of stock options(1) | (52,867) | (53,467) | ||
Stock-based compensation, Douglas Emmett Stockholders' Equity | 0 | 0 | ||
Sale of common stock, net of offering costs | 593,272 | 49,379 | ||
Douglas Emmett, Inc. Stockholders' Equity, Ending Balance | 2,435,922 | 1,892,177 | 2,435,922 | 1,892,177 |
Noncontrolling Interest [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Noncontrolling Interests, Beginning Balance | 1,092,928 | 355,337 | ||
Noncontrolling Interests, Net Income | 7,534 | 7,928 | ||
Cash flow hedge fair value adjustment, noncontrolling interest | (254) | (2,693) | ||
Contributions to consolidated JVs | 284,248 | 459,750 | ||
Sale of equity interest in consolidated JV | 291,029 | |||
Dividends and distributions, noncontrolling interest | (28,682) | (26,185) | ||
Exchange of OP units for common stock | (13,261) | (17,733) | ||
Repurchase of OP units | (328) | |||
Exercise of stock options(1) | 0 | 0 | ||
Stock-based compensation, noncontrolling interest | 8,642 | 7,759 | ||
Sale of common stock, net of offering costs | 0 | 0 | ||
Noncontrolling Interests, Ending Balance | $ 1,351,155 | $ 1,074,864 | $ 1,351,155 | $ 1,074,864 |
Equity - Net Income Attributabl
Equity - Net Income Attributable to Common Stockholders and Transfers (to) from Noncontrolling Interests (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Stockholders' Equity Note [Abstract] | ||||
Net income attributable to common stockholders | $ 25,614 | $ 31,848 | $ 64,907 | $ 65,696 |
Exchange of OP Units with noncontrolling interests | 13,261 | 17,733 | ||
Repurchase of OP Units from noncontrolling interests | 0 | (498) | ||
Net transfers from noncontrolling interests | 13,261 | 17,235 | ||
Change from net income attributable to common stockholders and transfers from noncontrolling interests | $ 78,168 | $ 82,931 |
Equity - Accumulated Other Comp
Equity - Accumulated Other Comprehensive Income Schedule (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 15,156 | |||
Net current period OCI | $ 1,493 | $ 18,429 | 7,129 | $ (17,069) |
Ending balance | 22,539 | 22,539 | ||
Cash Flow Hedging [Member] | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | 15,156 | (9,285) | ||
Other comprehensive income (loss) before reclassifications | (4,027) | (37,927) | ||
Reclassifications from AOCI | 10,353 | 21,361 | ||
Net current period OCI | 7,129 | (17,069) | ||
OCI attributable to noncontrolling interests | 254 | 2,693 | ||
OCI attributable to common stockholders | 7,383 | (14,376) | ||
Ending balance | $ 22,539 | $ (23,661) | 22,539 | (23,661) |
Cash Flow Hedging [Member] | Fund X [Member] | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Other comprehensive income (loss) before reclassifications | 610 | (814) | ||
Reclassifications from AOCI | $ 193 | $ 311 |
Equity - Equity Compensation (D
Equity - Equity Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Stockholders' Equity Note [Abstract] | ||||
Net stock-based compensation expense | $ 2,600 | $ 2,300 | $ 7,910 | $ 7,077 |
Capitalized stock-based compensation for improvements to real estate and developments | 257 | 235 | 732 | 683 |
Intrinsic value of options exercised | $ 400 | $ 2,100 | $ 102,500 | $ 104,000 |
EPS - Summary of EPS Computatio
EPS - Summary of EPS Computation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Earnings Per Share [Abstract] | ||||
Net income attributable to common stockholders | $ 25,614 | $ 31,848 | $ 64,907 | $ 65,696 |
Allocation to participating securities: Unvested LTIP Units | (158) | (180) | (345) | (365) |
Numerator for basic and diluted net income attributable to common stock holders | $ 25,456 | $ 31,668 | $ 64,562 | $ 65,331 |
Weighted average shares of common stock outstanding - basic (in shares) | 165,471 | 150,753 | 158,000 | 148,578 |
Effect of dilutive securities: Stock options (in shares) | 49 | 2,666 | 419 | 4,241 |
Weighted average shares of common stock and common stock equivalents outstanding - diluted (in shares) | 165,520 | 153,419 | 158,419 | 152,819 |
Basic EPS: | ||||
Net income attributable to common stockholders per share (usd per share) | $ 0.154 | $ 0.210 | $ 0.409 | $ 0.440 |
Diluted EPS: | ||||
Net income attributable to common stockholders per share (usd per share) | $ 0.154 | $ 0.206 | $ 0.408 | $ 0.428 |
Operating Partnership Units and Vested LTIP Units [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive securities excluded from the computation of weighted average diluted shares (in shares) | 24,790 | 24,788 | 24,750 | 25,148 |
Vested LTIP Units [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive securities excluded from the computation of weighted average diluted shares (in shares) | 8 | 675 | 358 | 766 |
Fair Value of Financial Instr70
Fair Value of Financial Instruments - Estimated Fair Value of Secured Notes Payable (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Estimate of Fair Value Measurement [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Secured notes payable | $ 4,080,901 | $ 4,429,224 |
Reported Value Measurement [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Secured notes payable | $ 4,087,638 | $ 4,408,083 |
Fair Value of Financial Instr71
Fair Value of Financial Instruments - Financial Instruments Measured at Fair Value (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Derivative Assets: | ||
Fair value - derivatives | $ 37,115 | $ 35,656 |
Derivative Liabilities: | ||
Fair value - derivatives | $ 2,002 | 6,830 |
Fund X [Member] | Interest Rate Swap [Member] | ||
Derivative Liabilities: | ||
Percent of notional amount related to the Fund | 100.00% | |
Level 2 | ||
Derivative Assets: | ||
Fair value - derivatives | $ 37,115 | 35,656 |
Derivative Liabilities: | ||
Fair value - derivatives | 2,002 | 6,830 |
Level 2 | Fund X [Member] | ||
Derivative Assets: | ||
Fair value - unconsolidated Funds' derivatives | 4,632 | 3,605 |
Derivative Liabilities: | ||
Fair value - unconsolidated Funds' derivatives | $ 0 | $ 0 |
Segment Reporting - Narrative (
Segment Reporting - Narrative (Details) | 9 Months Ended |
Sep. 30, 2017segment | |
Segment Reporting [Abstract] | |
Number of reportable business segments | 2 |
Segment Reporting - Operating A
Segment Reporting - Operating Activity Within Reportable Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Segment Reporting Information [Line Items] | ||||
Total office revenues | $ 184,618 | $ 167,608 | $ 530,508 | $ 475,083 |
Office expenses | (62,468) | (56,926) | (175,240) | (158,190) |
Total multifamily revenues | 24,131 | 24,513 | 72,354 | 72,825 |
Multifamily expenses | (6,041) | (5,950) | (17,866) | (17,322) |
Segment profit | 140,240 | 129,245 | 409,756 | 372,396 |
Office segment [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total office revenues | 184,618 | 167,608 | 530,508 | 475,083 |
Office expenses | (62,468) | (56,926) | (175,240) | (158,190) |
Segment profit | 122,150 | 110,682 | 355,268 | 316,893 |
Multifamily segment [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total multifamily revenues | 24,131 | 24,513 | 72,354 | 72,825 |
Multifamily expenses | (6,041) | (5,950) | (17,866) | (17,322) |
Segment profit | $ 18,090 | $ 18,563 | $ 54,488 | $ 55,503 |
Segment Reporting - Reconciliat
Segment Reporting - Reconciliation of Segment Profit to Net Income Attributable to Common Stockholders (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Segment Reporting [Abstract] | ||||
Total profit from all segments | $ 140,240 | $ 129,245 | $ 409,756 | $ 372,396 |
General and administrative | (8,441) | (8,099) | (27,189) | (25,573) |
Depreciation and amortization | (69,974) | (63,827) | (206,141) | (181,947) |
Other income | 2,659 | 2,295 | 7,152 | 6,527 |
Other expenses | (1,659) | (2,916) | (5,156) | (7,828) |
Income, including depreciation, from unconsolidated real estate funds | 1,137 | 2,334 | 4,427 | 5,564 |
Interest expense | (35,454) | (36,479) | (110,408) | (109,842) |
Income before gains | 28,508 | 22,553 | 72,441 | 59,297 |
Gains on sales of investments in real estate | 0 | 13,245 | 0 | 14,327 |
Net income | 28,508 | 35,798 | 72,441 | 73,624 |
Less: Net income attributable to noncontrolling interests | (2,894) | (3,950) | (7,534) | (7,928) |
Net income attributable to common stockholders | $ 25,614 | $ 31,848 | $ 64,907 | $ 65,696 |
Future Minimum Lease Rental R75
Future Minimum Lease Rental Receipts - Summary of Minimum Rental Receipts (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2017USD ($)land_parcel | |
Real Estate Properties [Line Items] | |
2,018 | $ 528,867 |
2,019 | 477,732 |
2,020 | 416,289 |
2,021 | 333,742 |
2,022 | 251,975 |
Thereafter | 657,646 |
Total future minimum base rentals | $ 2,666,251 |
Term of residential leases | 1 year |
Wholly Owned Properties [Member] | |
Real Estate Properties [Line Items] | |
Number of land parcels | land_parcel | 2 |
Future Minimum Lease Rental P76
Future Minimum Lease Rental Payments - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||||
Ground lease payments | $ 183 | $ 183 | $ 550 | $ 550 |
Future Minimum Lease Rental P77
Future Minimum Lease Rental Payments - Summary of Ground Lease Payments (Details) $ in Thousands | Sep. 30, 2017USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2,018 | $ 733 |
2,019 | 733 |
2,020 | 733 |
2,021 | 733 |
2,022 | 733 |
Thereafter | 47,094 |
Total future minimum lease payments | 50,759 |
Future ground rent payments per year | $ 733 |
Commitments, Contingencies an78
Commitments, Contingencies and Guarantees - Narrative (Details) | 3 Months Ended | 9 Months Ended |
Mar. 31, 2016USD ($)apartment | Sep. 30, 2017USD ($)propertyapartment | |
Loss Contingencies [Line Items] | ||
Amount accounts are insured for by Federal Deposit Insurance Corporation | $ 250,000 | |
Number of properties containing Asbestos | property | 27 | |
Contractual amount for development project | $ 4,800,000 | |
Apartment Building [Member] | ||
Loss Contingencies [Line Items] | ||
Contractual amount for development project | $ 73,100,000 | |
Apartment Building [Member] | HAWAII | ||
Loss Contingencies [Line Items] | ||
Number of apartments under construction | apartment | 475 | |
Estimated construction costs | $ 120,000,000 | |
Apartment Building [Member] | CALIFORNIA | ||
Loss Contingencies [Line Items] | ||
Expected number of apartments to be constructed | apartment | 376 | |
Minimum [Member] | Apartment Building [Member] | CALIFORNIA | ||
Loss Contingencies [Line Items] | ||
Estimated construction costs | $ 180,000,000 | |
Maximum [Member] | Apartment Building [Member] | CALIFORNIA | ||
Loss Contingencies [Line Items] | ||
Estimated construction costs | $ 200,000,000 | |
Unconsolidated Funds [Member] | ||
Loss Contingencies [Line Items] | ||
Number of properties containing Asbestos | property | 4 |
Commitments, Contingencies an79
Commitments, Contingencies and Guarantees - Schedule of Debt Related to Unconsolidated Funds (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017USD ($)property | Dec. 31, 2016USD ($) | |
Debt Instrument [Line Items] | ||
Long-term debt | $ 4,048,828 | $ 4,369,537 |
Partnership X [Member] | ||
Debt Instrument [Line Items] | ||
Loan Maturity Date | Mar. 1, 2023 | |
Long-term debt | $ 110,000 | |
Collateral, number of properties | property | 2 | |
Maximum future payments under the swap agreement | $ 3,400 | |
Partnership X [Member] | Interest Rate Swap [Member] | ||
Debt Instrument [Line Items] | ||
Variable Interest Rate - basis spread | 1.40% | |
Swap Fixed Interest Rate | 2.30% | |
Swap Maturity Date | Mar. 1, 2021 | |
Fund X [Member] | ||
Debt Instrument [Line Items] | ||
Loan Maturity Date | Jul. 1, 2024 | |
Long-term debt | $ 400,000 | |
Collateral, number of properties | property | 6 | |
Maximum future payments under the swap agreement | $ 34,500 | |
Loan agreement, one month LIBOR maximum for interest rate cap requirement | 3.56% | |
Loan agreement, number of consecutive days | 14 days | |
Fund X [Member] | Interest Rate Swap [Member] | ||
Debt Instrument [Line Items] | ||
Variable Interest Rate - basis spread | 1.65% | |
Swap Fixed Interest Rate | 3.44% | |
Swap Maturity Date | Jul. 1, 2022 | |
Unconsolidated Funds [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 510,000 | |
LIBOR [Member] | Partnership X [Member] | ||
Debt Instrument [Line Items] | ||
Loan agreement LIBOR floor | 0.00% | |
LIBOR [Member] | Fund X [Member] | ||
Debt Instrument [Line Items] | ||
Loan agreement LIBOR floor | 0.00% |