Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2015 | Apr. 30, 2015 | |
Document and Entity Information | ||
Entity Registrant Name | Monogram Residential Trust, Inc. | |
Entity Central Index Key | 1384710 | |
Document Type | 10-Q | |
Document Period End Date | 31-Mar-15 | |
Amendment Flag | FALSE | |
Current Fiscal Year End Date | -19 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 166,516,021 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q1 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Real estate | ||
Land ($58,938 related to VIEs as of March 31, 2015 and December 31, 2014, respectively) | $379,485 | $389,885 |
Buildings and improvements ($242,736 and $227,817 related to VIEs as of March 31, 2015 and December 31, 2014, respectively) | 1,972,480 | 2,033,819 |
Total real estate, gross | 2,351,965 | 2,423,704 |
Less accumulated depreciation ($7,407 and $4,605 related to VIEs as of March 31, 2015 and December 31, 2014, respectively) | -291,366 | -280,400 |
Net operating real estate | 2,060,599 | 2,143,304 |
Construction in progress, including land ($654,679 and $582,299 related to VIEs as of March 31, 2015 and December 31, 2014, respectively) | 811,735 | 716,930 |
Total real estate, net | 2,872,334 | 2,860,234 |
Assets associated with real estate held for sale | 76,601 | 0 |
Cash and cash equivalents | 70,379 | 116,407 |
Intangibles, net | 20,440 | 21,485 |
Other assets, net | 114,496 | 110,282 |
Total assets | 3,154,250 | 3,108,408 |
Liabilities | ||
Mortgages and notes payable ($322,033 and $227,310 related to VIEs as of March 31, 2015 and December 31, 2014, respectively) | 1,232,200 | 1,186,481 |
Credit facility payable | 35,000 | 10,000 |
Construction costs payable ($70,698 and $63,393 related to VIEs as of March 31, 2015 and December 31, 2014, respectively) | 85,097 | 75,623 |
Accounts payable and other liabilities | 20,893 | 28,053 |
Deferred revenues, primarily lease revenues, net | 18,587 | 18,955 |
Distributions payable | 12,576 | 12,485 |
Tenant security deposits | 4,580 | 4,586 |
Obligations associated with real estate held for sale | 741 | 0 |
Total liabilities | 1,409,674 | 1,336,183 |
Commitments and contingencies | ||
Redeemable noncontrolling interests ($27,444 related to VIEs as of March 31, 2015 and December 31, 2014, respectively) | 32,043 | 32,012 |
Equity | ||
Preferred stock, $0.0001 par value per share; 125,000,000 shares authorized as of March 31, 2015 and December 31, 2014, respectively: 7.0% Series A non-participating, voting, cumulative, convertible preferred stock, liquidation preference $10 per share, 10,000 shares issued and outstanding as of March 31, 2015 and December 31, 2014 | 0 | 0 |
Common stock, $0.0001 par value per share; 875,000,000 shares authorized, 166,517,649 and 166,467,726 shares issued and outstanding as of March 31, 2015 and December 31, 2014, respectively | 17 | 17 |
Additional paid-in capital | 1,493,184 | 1,492,799 |
Cumulative distributions and net income (loss) | -306,671 | -293,350 |
Total equity attributable to common stockholders | 1,186,530 | 1,199,466 |
Non-redeemable noncontrolling interests | 526,003 | 540,747 |
Total equity | 1,712,533 | 1,740,213 |
Total liabilities and equity | $3,154,250 | $3,108,408 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | 3 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
Land | $379,485 | $389,885 |
Buildings and improvements | 1,972,480 | 2,033,819 |
Less accumulated depreciation | -291,366 | -280,400 |
Construction in progress | 811,735 | 716,930 |
Mortgages and notes payable | 1,232,200 | 1,186,481 |
Construction costs payable | 85,097 | 75,623 |
Redeemable noncontrolling interests | 32,043 | 32,012 |
Preferred stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred stock, shares authorized | 125,000,000 | 125,000,000 |
Preferred stock, shares issued | 10,000 | 10,000 |
Preferred stock, shares outstanding | 10,000 | 10,000 |
Preferred Stock, Liquidation Preference Per Share | $10 | |
Preferred Stock, Dividend Rate, Percentage | 7.00% | |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 875,000,000 | 875,000,000 |
Common Stock, Shares, Issued | 166,517,649 | 166,467,726 |
Common stock, shares outstanding | 166,517,649 | 166,467,726 |
VIEs | ||
Land | 58,938 | 58,938 |
Buildings and improvements | 242,736 | 227,817 |
Less accumulated depreciation | -7,407 | -4,605 |
Construction in progress | 654,679 | 582,299 |
Mortgages and notes payable | 322,033 | 227,310 |
Construction costs payable | 70,698 | 63,393 |
Redeemable noncontrolling interests | $27,444 | $27,444 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Income Statement [Abstract] | ||
Rental revenues | $56,643 | $50,182 |
Expenses | ||
Property operating expenses | 15,675 | 13,041 |
Real estate taxes | 8,569 | 7,153 |
Asset management fees | 0 | 1,880 |
General and administrative expenses | 4,776 | 3,360 |
Acquisition expenses | 0 | -17 |
Transition expenses | 0 | 520 |
Investment and development expenses | 231 | 248 |
Interest expense | 5,997 | 5,331 |
Depreciation and amortization | 25,380 | 22,977 |
Total expenses | 60,628 | 54,493 |
Interest income | 2,597 | 2,446 |
Loss on early extinguishment of debt | 0 | -230 |
Equity in income of investments in unconsolidated real estate joint ventures | 186 | 204 |
Other income | 25 | 200 |
Loss from continuing operations before gain on sale of real estate | -1,177 | -1,691 |
Gain on sale of real estate | 0 | 16,167 |
Net income (loss) | -1,177 | 14,476 |
Net (income) loss attributable to noncontrolling interests: | ||
Net (income) loss attributable to non-redeemable noncontrolling interests | 346 | -7,051 |
Net income (loss) available to the Company | -831 | 7,425 |
Dividends to preferred stockholders | -2 | -2 |
Net income (loss) attributable to common stockholders | ($833) | $7,423 |
Weighted average number of common shares outstanding - basic | 166,509 | 168,714 |
Weighted average number of common shares outstanding - diluted | 166,509 | 168,919 |
Basic and diluted earnings (loss) per common share (in dollars per share) | ($0.01) | $0.04 |
Distributions declared per common share (in dollars per share) | $0.08 | $0.09 |
Consolidated_Statements_of_Equ
Consolidated Statements of Equity (USD $) | Total | Preferred Stock | Common Stock | Additional Paid-in Capital | Noncontrolling Interests | Cumulative Distributions and Net Income (Loss) Available to the Company |
In Thousands, except Share data, unless otherwise specified | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | |
Balance at Dec. 31, 2013 | $1,734,323 | $17 | $1,508,655 | $456,205 | ($230,554) | |
Balance (in shares) at Dec. 31, 2013 | 10,000 | 168,320,000 | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income (loss) | 14,476 | 7,051 | 7,425 | |||
Redemptions of common stock | -7,000 | -7,000 | ||||
Redemptions of common stock (in shares) | -794,188 | -794,000 | ||||
Sale of a noncontrolling interests | 14,166 | -842 | 15,008 | |||
Contributions by noncontrolling interests | 19,453 | 19,453 | ||||
Amortization of stock-based compensation | 174 | 174 | ||||
Distributions: | ||||||
Common stock - regular | -14,561 | -14,561 | ||||
Noncontrolling interests | -20,714 | -20,714 | ||||
Stock issued pursuant to distribution reinvestment plan, net | 7,602 | 7,602 | ||||
Stock issued pursuant to distribution reinvestment plan, net (in shares) | 798,000 | |||||
Balance at Mar. 31, 2014 | 1,747,919 | 17 | 1,508,589 | 477,003 | -237,690 | |
Balance (in shares) at Mar. 31, 2014 | 10,000 | 168,324,000 | ||||
Balance at Dec. 31, 2014 | 1,740,213 | 17 | 1,492,799 | 540,747 | -293,350 | |
Balance (in shares) at Dec. 31, 2014 | 10,000 | 166,468,000 | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income (loss) | -1,177 | -346 | -831 | |||
Contributions by noncontrolling interests | 8,725 | 8,725 | ||||
Issuance of common and restricted shares, net | -119 | -119 | ||||
Issuance of common and restricted shares, net (in shares) | 50,000 | |||||
Amortization of stock-based compensation | 504 | 504 | ||||
Distributions: | ||||||
Common stock - regular | -12,488 | -12,488 | ||||
Noncontrolling interests | -23,123 | -23,123 | ||||
Preferred stock | -2 | -2 | ||||
Balance at Mar. 31, 2015 | $1,712,533 | $17 | $1,493,184 | $526,003 | ($306,671) | |
Balance (in shares) at Mar. 31, 2015 | 10,000 | 166,518,000 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Cash flows from operating activities | ||
Net income (loss) | ($1,177) | $14,476 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Gain on sale of real estate | 0 | -16,167 |
Loss on early extinguishment of debt | 0 | 230 |
Equity in income of investments in unconsolidated real estate joint ventures | -186 | -204 |
Distributions received from investment in unconsolidated real estate joint venture | 125 | 0 |
Depreciation | 23,473 | 21,371 |
Amortization of deferred financing costs and debt premium/discount | 284 | -126 |
Amortization of intangibles | 1,046 | 1,051 |
Amortization of deferred revenues, primarily lease revenues, net | -359 | -357 |
Amortization of stock-based compensation | 504 | 174 |
Other, net | -8 | 34 |
Changes in operating assets and liabilities: | ||
Accounts payable and other liabilities | -6,681 | -7,527 |
Other assets | -2,493 | -2,278 |
Cash provided by operating activities | 14,528 | 10,677 |
Additions to real estate: | ||
Additions to existing real estate | -1,551 | -1,232 |
Construction in progress, including land | -99,418 | -77,572 |
Proceeds from sale of real estate, net | 0 | 33,134 |
Acquisitions of noncontrolling interests | 0 | -3,898 |
Advances on notes receivable | 0 | -3,608 |
Escrow deposits | -865 | 3,669 |
Other, net | -118 | -87 |
Cash used in investing activities | -101,952 | -49,594 |
Cash flows from financing activities | ||
Mortgage and notes payable proceeds | 100,747 | 24,356 |
Mortgage and notes payable principal payments | -54,489 | -1,132 |
Proceeds from credit facilities | 25,000 | 0 |
Finance costs paid | -2,945 | -678 |
Contributions from noncontrolling interests | 8,725 | 33,681 |
Distributions paid on common stock - regular | -12,485 | -6,963 |
Distributions paid to noncontrolling interests | -23,038 | -20,638 |
Redemptions of common stock | 0 | -7,000 |
Other, net | -119 | 0 |
Cash provided by financing activities | 41,396 | 21,626 |
Net change in cash and cash equivalents | -46,028 | -17,291 |
Cash and cash equivalents at beginning of period | 116,407 | 319,368 |
Cash and cash equivalents at end of period | $70,379 | $302,077 |
Organization_and_Business
Organization and Business | 3 Months Ended | |||||
Mar. 31, 2015 | ||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||
Organization and Business | Organization and Business | |||||
Organization | ||||||
Monogram Residential Trust, Inc. (which, together with its subsidiaries as the context requires, may be referred to as the “Company,” “we,” “us,” or “our”) was organized in Maryland on August 4, 2006. Effective as of June 30, 2014, we became a self-managed real estate investment trust (“REIT”) as further described below. We invest in stabilized operating properties and properties in various phases of development, with a focus on communities in select markets across the United States. These include luxury mid-rise, high-rise and garden style multifamily communities. Our targeted communities include existing “core” properties, which we define as properties that are already stabilized and producing rental income, as well as properties in various phases of development, redevelopment, lease up or repositioning with the intent to transition those properties to core properties. Further, we may invest in other real estate-related securities, including mortgage, bridge, mezzanine or other loans, or in entities that make investments similar to the foregoing. We completed our first investment in April 2007. | ||||||
From our inception to July 31, 2013, we had no employees and were externally managed by Behringer Harvard Multifamily Advisors I, LLC, our former external advisor, and were supported by related party service agreements with our former external advisor and its affiliates (collectively “Behringer”). Through July 31, 2013, we exclusively relied on Behringer to provide certain services and personnel for management and day-to-day operations, including advisory services and property management services. | ||||||
Effective July 31, 2013, we entered into a series of agreements with Behringer beginning our transition to self-management (the “Self-Management Transition Agreements”). On August 1, 2013, we hired five executives who were previously employees of Behringer and subsequently began hiring additional employees. We closed the Self-Management Transition Agreements on June 30, 2014 effectively terminating substantially all advisory and property management services provided by Behringer. Effective July 1, 2014, we hired the remaining professionals and staff providing advisory and property management services to us that were previously employees of Behringer and began operating as a self-managed, independent company. On November 21, 2014, we listed our shares of common stock on the New York Stock Exchange (the “NYSE”) under the ticker symbol “MORE.” | ||||||
We invest in multifamily communities that may be wholly owned by us or held through joint venture arrangements with third-party institutional or other national or regional real estate developers/owners which we define as “Co-Investment Ventures” or “CO-JVs.” These are predominately equity investments but may also include debt investments, consisting of mezzanine, bridge and land loans. If a Co-Investment Venture makes an equity or debt investment in a separate entity with additional third parties, we refer to such a separate entity as a “Property Entity” and when applicable may name the multifamily community related to the Property Entity or CO-JV. | ||||||
As of March 31, 2015, we have equity and debt investments in 56 multifamily communities, of which 38 are stabilized operating multifamily communities and 18 are in various stages of lease up, pre-development or construction. Of the 56 multifamily communities, we wholly own seven multifamily communities and three debt investments for a total of 10 wholly owned investments. The remaining 46 investments are held through Co-Investment Ventures, 45 of which are consolidated and one is reported on the equity method of accounting. The one unconsolidated Co-Investment Venture holds a debt investment. | ||||||
As of March 31, 2015, we are the general partner and/or managing member for each of the separate Co-Investment Ventures. Our two largest Co-Investment Venture partners are Stichting Depositary PGGM Private Real Estate Fund, a Dutch foundation acting in its capacity as depositary of and for the account and risk of PGGM Private Real Estate Fund and its affiliates, a real estate investment vehicle for Dutch pension funds (“PGGM” or the “PGGM Co-Investment Partner”), and Milky Way Partners, L.P. (the “MW Co-Investment Partner”), the primary partner of which is Korea Exchange Bank, as Trustee for and on behalf of National Pension Service (acting for and on behalf of the National Pension Fund of the Republic of Korea Government) (“NPS”). Our other Co-Investment Venture partners include national or regional real estate developers/owners (“Developer Partners”). When applicable, we refer to individual investments by referencing the individual Co-Investment Venture partner or the underlying multifamily community. We refer to our Co-Investment Ventures with the PGGM Co-Investment Partner as “PGGM CO-JVs,” those with the MW Co-Investment Partner as “MW CO-JVs,” and those with Developer Partners as “Developer CO-JVs.” Certain PGGM CO-JVs that also include Developer Partners are referred to as PGGM CO-JVs. We are the 1% general partner of Monogram Residential Master Partnership I LP (the “Master Partnership” or the PGGM Co-Investment Partner) and PGGM is the 99% limited partner. | ||||||
The table below presents a summary of our Co-Investment Ventures as of both March 31, 2015 and December 31, 2014. The effective ownership ranges are based on our participation in the distributable operating cash from the multifamily investment. This effective ownership is indicative of, but may differ over time from, percentages for distributions, contributions or financing requirements for each respective Co-Investment Venture. Unless otherwise noted, all are reported on the consolidated basis of accounting. | ||||||
Co-Investment Structure | Number of Multifamily Communities | Our Effective | ||||
Ownership | ||||||
PGGM CO-JVs (a) | 30 | 50% to 74% | ||||
MW CO-JVs | 14 | 55% | ||||
Developer CO-JVs | 2 | 100% | ||||
Total | 46 | |||||
(a) | Includes one unconsolidated investment as of March 31, 2015 and December 31, 2014. Also, as of March 31, 2015 and December 31, 2014, includes Developer Partners in 19 multifamily communities. In May 2015, we acquired noncontrolling interests and controlling interests in seven PGGM CO-JVs. See Note 17, “Subsequent Events” for further information. | |||||
We have elected to be taxed, and currently qualify, as a REIT for federal income tax purposes. As a REIT, we generally are not subject to corporate-level income taxes. To maintain our REIT status, we are required, among other requirements, to distribute annually at least 90% of our “REIT taxable income,” as defined by the Internal Revenue Code of 1986, as amended (the “Code”), to our stockholders. If we fail to qualify as a REIT in any taxable year, we would be subject to federal income tax on our taxable income at regular corporate tax rates. As of March 31, 2015, we believe we are in compliance with all applicable REIT requirements. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies |
Interim Unaudited Financial Information | |
The accompanying consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2014 which was filed with the Securities and Exchange Commission (“SEC”) on March 26, 2015. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted from this report. | |
The results for the interim periods shown in this report are not necessarily indicative of future financial results. The accompanying consolidated balance sheet as of March 31, 2015 and consolidated statements of operations, equity and cash flows for the periods ended March 31, 2015 and 2014 have not been audited by our independent registered public accounting firm. In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments necessary to present fairly our consolidated financial position as of March 31, 2015 and December 31, 2014 and our consolidated results of operations and cash flows for the periods ended March 31, 2015 and 2014. Such adjustments are of a normal recurring nature. | |
We have evaluated subsequent events for recognition or disclosure in our consolidated financial statements. | |
Basis of Presentation | |
The accompanying consolidated financial statements include our consolidated accounts and the accounts of our wholly owned subsidiaries. We also consolidate other entities in which we have a controlling financial interest or other entities (referred to as variable interest entities or “VIEs”) where we are determined to be the primary beneficiary. VIEs, as defined by GAAP, are generally entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders lack adequate decision making ability. The primary beneficiary is required to consolidate a VIE for financial reporting purposes. The determination of the primary beneficiary requires management to make significant estimates and judgments about our rights, obligations, and economic interests in such entities as well as the same of the other owners. See Note 5, “Variable Interest Entities” for further information about our VIEs. For entities in which we have less than a controlling financial interest or entities with respect to which we are not deemed to be the primary beneficiary, the entities are accounted for using the equity method of accounting. Accordingly, our share of the net earnings or losses of these entities is included in consolidated net income. See Note 6, “Other Assets” for further information on our unconsolidated investment. All inter-company accounts and transactions have been eliminated in consolidation. | |
Real Estate and Other Related Intangibles | |
Acquisitions | |
For real estate properties acquired by us or our Co-Investment Ventures classified as business combinations, we determine the purchase price, after adjusting for contingent consideration and settlement of any pre-existing relationships. We record the acquired assets and liabilities based on their fair values, including tangible assets (consisting of land, any associated rights, buildings and improvements), identified intangible assets and liabilities, asset retirement obligations, assumed debt, other liabilities and noncontrolling interests. Identified intangible assets and liabilities primarily consist of the fair value of in-place leases and contractual rights. Goodwill is recognized as of the acquisition date and measured as the aggregate fair value of the consideration transferred and any noncontrolling interest in the acquiree over the fair value of identifiable net assets acquired. Likewise, a bargain purchase gain is recognized in current earnings when the aggregate fair value of the consideration transferred and any noncontrolling interest in the acquiree are less than the fair value of the identifiable net assets acquired. | |
The fair value of any tangible real estate assets acquired is determined by valuing the property as if it were vacant, and the “as-if-vacant” value is then allocated to land, buildings and improvements. Land values are derived from appraisals, and building values are calculated as replacement cost less depreciation or estimates of the relative fair value of these assets using net operating income capitalization rates, discounted cash flow analyses or similar methods. When we acquire rights to use land or improvements through contractual rights rather than fee simple interests, we determine the value of the use of these assets based on the relative fair value of the assets after considering the contractual rights and the fair value of similar assets. Assets acquired under these contractual rights are classified as intangibles and amortized on a straight-line basis over the shorter of the contractual term or the estimated useful life of the asset. Contractual rights related to land or air rights that are substantively separated from depreciating assets are amortized over the life of the contractual term or, if no term is provided, are classified as indefinite-lived intangibles. Intangible assets are evaluated at each reporting period to determine whether the indefinite and finite useful lives are appropriate. | |
We determine the value of in-place lease values and tenant relationships based on our evaluation of the specific characteristics of each tenant’s lease and our overall relationship with that respective tenant by applying a fair value model. The estimates of fair value of in-place leases include an estimate of carrying costs during the expected lease up periods for the respective leasable area considering current market conditions. In estimating fair value of in-place leases, we consider items such as real estate taxes, insurance, leasing commissions, tenant improvements and other operating expenses to execute similar deals as well as projected rental revenue and carrying costs during the expected lease up period. The estimate of the fair value of tenant relationships also includes our estimate of the likelihood of renewal. We amortize the value of in-place leases acquired to expense over the remaining term of the leases. The value of tenant relationship intangibles will be amortized to expense over the initial term and any anticipated renewal periods, but in no event will the amortization period for intangible assets exceed the remaining depreciable life of the building. The in-place leases are amortized over the remaining term of the in-place leases, approximately a six month term for multifamily in-place leases and terms ranging from three to 20 years for retail in-place leases. | |
We determine the value of above-market and below-market in-place leases for acquired properties based on the present value (using an interest rate that reflects the risks associated with the leases acquired) of the difference between (1) the contractual amounts to be paid pursuant to the in-place leases and (2) estimates of current market lease rates for the corresponding in-place leases, measured over a period equal to (i) the remaining non-cancelable lease term for above-market leases, or (ii) the remaining non-cancelable lease term plus any fixed rate renewal options for below-market leases. We record the fair value of above-market and below-market leases as intangible assets or intangible liabilities, respectively, and amortize them as an adjustment to rental income over the above determined lease term. Given the short-term nature of multifamily leases, the value of above-market or below-market in-place leases are generally not material. | |
We determine the value of other contractual rights based on our evaluation of the specific characteristics of the underlying contracts and by applying a fair value model to the projected cash flows or usage rights that considers the timing and risks associated with the cash flows or usage. We amortize the value of finite contractual rights over the remaining contract period. Indefinite-lived contractual rights are not amortized but are evaluated for impairment. | |
We determine the fair value of assumed debt by calculating the net present value of the scheduled debt service payments using interest rates for debt with similar terms and remaining maturities that management believes we could obtain. Any difference between the fair value and stated value of the assumed debt is recorded as a discount or premium and amortized over the remaining life of the loan. | |
Initial valuations are subject to change until our information is finalized, which is no later than 12 months from the acquisition date. We have had no significant valuation changes for acquisitions prior to March 31, 2015. | |
Developments | |
We capitalize project costs related to the development and construction of real estate (including interest, real estate taxes, insurance, and other direct costs associated with the development) as a cost of the development. Indirect project costs not clearly related to development and construction are expensed as incurred. Indirect project costs that clearly relate to development and construction are capitalized and allocated to the developments to which they relate. For each development, capitalization begins when we determine that the development is probable and significant development activities are underway. We suspend capitalization at such time as significant development activity ceases, but future development is still probable. We cease capitalization when the developments or other improvements, including any portion, are completed and ready for their intended use, or if the intended use changes such that capitalization is no longer appropriate. Developments or improvements are generally considered ready for intended use when the certificates of occupancy have been issued and the units become ready for occupancy. | |
Depreciation | |
Buildings are depreciated over their estimated useful lives ranging from 25 to 35 years using the straight-line method. Improvements are depreciated over their estimated useful lives ranging from 3 to 15 years using the straight-line method. Properties classified as held for sale are not depreciated. Depreciation of developments begins when the development is substantially completed and ready for its intended use. | |
Repairs and Maintenance | |
Expenditures for ordinary repairs and maintenance costs are charged to expense as incurred. | |
Investment in Unconsolidated Real Estate Joint Venture | |
We and our Co-Investment Ventures account for investments in unconsolidated real estate joint ventures using the equity method of accounting when we exercise significant influence over, but do not control, these entities. These investments are initially recorded at cost, including any acquisition costs, and are adjusted for our share of equity in earnings and distributions. We report our share of income and losses based on our economic interests in the entities. | |
We capitalize interest expense to investments in unconsolidated real estate joint ventures for our share of qualified expenditures during their development phase. We did not capitalize any interest expense related to investments in unconsolidated real estate joint ventures for the three months ended March 31, 2015 or 2014. | |
We amortize any excess of the carrying value of our investments in joint ventures over the book value of the underlying equity over the estimated useful lives of the underlying operating property, which represents the assets to which the excess is most clearly related. | |
When we or our Co-Investment Ventures acquire a controlling interest in a previously noncontrolled investment, a gain or loss on revaluation of equity is recognized for the differences between the investment’s carrying value and fair value. | |
Impairment of Real Estate Related Assets and Investments in Unconsolidated Real Estate Joint Ventures | |
If events or circumstances indicate that the carrying amount of the property may not be recoverable, we make an assessment of the property’s recoverability by comparing the carrying amount of the asset to our estimate of the undiscounted future operating cash flows expected to be generated over the holding period of the asset including its eventual disposition. If the carrying amount exceeds the aggregate undiscounted future operating cash flows, we recognize an impairment loss to the extent the carrying amount exceeds the estimated fair value of the property. In addition, we evaluate indefinite-lived intangible assets for possible impairment at least annually by comparing the fair values with the carrying values. The fair value of intangibles is generally estimated by valuation of similar assets. | |
For real estate we own through an investment in an unconsolidated real estate joint venture or other similar real estate investment structure, at each reporting date we compare the estimated fair value of our real estate investment to the carrying value. An impairment charge is recorded to the extent the fair value of our real estate investment is less than the carrying amount and the decline in value is determined to be other than a temporary decline. | |
We did not record any impairment losses for the three months ended March 31, 2015 or 2014. | |
Assets Held for Sale and Discontinued Operations | |
Prior to January 1, 2014, when we had no involvement after the sale of a multifamily community, the multifamily community sold was reported as a discontinued operation. Effective as of January 1, 2014, we elected to early adopt the revised guidance regarding discontinued operations as further discussed in Note 3, “New Accounting Pronouncements.” For sales of real estate or assets classified as held for sale after January 1, 2014, we evaluate whether the disposition will have a major effect on our operations and financial results and will therefore qualify as a strategic shift. If the disposition represents a strategic shift, it will be classified as discontinued operations in our consolidated statements of operations for all periods presented. If the disposition does not represent a strategic shift, it will be presented in continuing operations in our consolidated statements of operations. | |
We classify multifamily communities as held for sale when certain criteria are met, in accordance with GAAP. At that time, we present the assets and obligations associated with the real estate held for sale separately in our consolidated balance sheet, and we cease recording depreciation and amortization expense related to that multifamily community. Real estate held for sale is reported at the lower of its carrying amount or its estimated fair value less estimated costs to sell. | |
Cash and Cash Equivalents | |
We consider investments in bank deposits, money market funds and highly-liquid cash investments with original maturities of three months or less to be cash equivalents. | |
As of March 31, 2015 and December 31, 2014, cash and cash equivalents include $25.4 million and $42.0 million, respectively, held by the Master Partnership and individual Co-Investment Ventures that are available only for use in the business of the Master Partnership and the other individual Co-Investment Ventures. Cash held by individual Co-Investment Ventures is not restricted to specific uses within those entities. However, the terms of the joint venture agreements limit the ability to distribute those funds to us or use them for our general corporate purposes. Cash held by individual Co-Investment Ventures is distributed from time to time to the Company and to the other Co-Investment Venture partners in accordance with the applicable Co-Investment Venture governing agreement, which may not be the same as the stated effective ownership interest. Cash distributions received by the Company from the individual Co-Investment Ventures are then available for our general corporate purposes. | |
Noncontrolling Interests | |
Redeemable noncontrolling interests are comprised of our consolidated Co-Investment Venture partners’ interests in multifamily communities where we believe it is probable that we will be required to purchase the partner’s noncontrolling interest. We record obligations under the redeemable noncontrolling interest initially at the higher of (a) fair value or (b) the redemption value with subsequent adjustments. The redeemable noncontrolling interests are temporary equity not within our control and are presented in our consolidated balance sheet outside of permanent equity between debt and equity. The determination of the redeemable classification requires analysis of contractual provisions and judgments of redemption probabilities. | |
Non-redeemable noncontrolling interests are comprised of our consolidated Co-Investment Venture partners’ interests in multifamily communities as well as preferred cumulative, non-voting membership units (“Preferred Units”) issued by subsidiary REITs. We record these noncontrolling interests at their initial fair value, adjusting the basis prospectively for their share of the respective consolidated investments’ net income or loss or equity contributions and distributions. These noncontrolling interests are not redeemable by the equity holders and are presented as part of permanent equity. | |
Income and losses are allocated to the noncontrolling interest holder based on its economic interests. | |
Transactions involving a partial sale or acquisition of a noncontrolling interest that does not result in a change of control are recorded at carrying value with no recognition of gain or loss. Any differences between the cash received or paid (net of any direct expenses) and the change in noncontrolling interest is recorded as a direct charge to additional paid-in capital. Transactions involving a partial sale or acquisition of a controlling interest resulting in a change in control are recorded at fair value with recognition of a gain or loss. | |
Other Assets | |
Other assets primarily include deferred financing costs, notes receivable, equity method investments, accounts receivable, restricted cash, prepaid assets and deposits. Deferred financing costs are recorded at cost and are amortized using a straight-line method that approximates the effective interest method over the life of the related debt. We evaluate whether notes receivable are loans, investments in joint ventures or acquisitions of real estate based on a review of any rights to participate in expected residual profits and other equity and loan characteristics. As of and for the three months ended March 31, 2015 and 2014, all of our notes receivable were appropriately accounted for as loans. We account for our derivative financial instruments, all of which are interest rate caps, at fair value. We use interest rate cap arrangements to manage our exposure to interest rate changes. We have not designated any of these derivatives as hedges for accounting purposes, and accordingly, changes in fair value are recognized in earnings. | |
Revenue Recognition | |
Rental income related to leases is recognized on an accrual basis when due from residents or commercial tenants, generally on a monthly basis. Rental revenues for leases with uneven payments and terms greater than one year are recognized on a straight-line basis over the term of the lease. Any deferred revenue is classified as a liability on the consolidated balance sheet and recognized on a straight-line basis as income over its contractual term. | |
Interest income is generated primarily on notes receivable and cash balances. Interest income is recorded on an accrual basis as earned. | |
Transition Expenses | |
Transition expenses include expenses directly and specifically related to our transition to self-management, primarily including legal, financial advisors, consultants, costs of the Company’s special committee of the board of directors, comprised of all of the Company’s independent directors (the “Special Committee”), general transition services (primarily related to staffing, name change, notices, transition-related insurance, information technology and facilities), expenses related to our listing on the NYSE and payments to our former external advisor in connection with the transition to self-management discussed further in Note 12, “Transition Expenses.” | |
Income Taxes | |
We have elected to be taxed as a REIT under the Code and have qualified as a REIT since the year ended December 31, 2007. To qualify as a REIT, we must meet a number of organizational and operational requirements, including a requirement that we distribute at least 90% of our REIT taxable income to our stockholders. As a REIT, we generally will not be subject to federal income tax at the corporate level. We intend to operate in such a manner as to continue to qualify for taxation as a REIT, but no assurance can be given that we will operate in a manner so as to remain qualified as a REIT. Taxable income from certain non-REIT activities is managed through a taxable REIT subsidiary (“TRS”) and is subject to applicable federal, state, and local income and margin taxes. We have no significant taxes associated with our TRS for the three months ended March 31, 2015 or 2014. | |
We have evaluated the current and deferred income tax related to state taxes, with respect to which we do not have a REIT exemption, and we have no significant tax liability or benefit as of March 31, 2015 or December 31, 2014. | |
The carrying amounts of our assets and liabilities for financial statement purposes differ from our basis for federal income taxes due to tax accounting in Co-Investment Ventures, fair value accounting for business combinations, straight lining of lease and related agreements and differing depreciation methods. The primary asset and liability balance sheet accounts with differences are real estate, intangibles, other assets, mortgages and notes payable and deferred revenues, primarily lease revenues, net. | |
We recognize the financial statement benefit of an uncertain tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. As of March 31, 2015 and December 31, 2014, we had no significant uncertain tax positions. | |
Concentration of Credit Risk | |
We invest our cash and cash equivalents among several banking institutions and money market accounts in an attempt to minimize exposure to any one of these entities. As of March 31, 2015 and December 31, 2014, we had cash and cash equivalents deposited in certain financial institutions in excess of federally-insured levels. We regularly monitor the financial condition of these financial institutions and believe that we are not exposed to any significant credit risk in cash and cash equivalents. | |
Share-based Compensation | |
We have a stock-based incentive award plan for our employees and directors, which includes restricted stock units and restricted stock awards. Compensation expense associated with the stock-based plan is recognized in general and administrative expenses in our consolidated statements of operations. We measure stock-based compensation at the estimated fair value on the grant date, net of estimated forfeitures, and recognize the amortization of compensation expense over the requisite service period. | |
Earnings per Share | |
Basic earnings per share is calculated by dividing net income attributable to common stockholders by the weighted average number of common shares outstanding during the period excluding any unvested restricted stock awards. Diluted earnings per share is calculated by adjusting basic earnings per share for the dilutive effect of the assumed exercise of securities, including the effect of shares issuable under our preferred stock and our stock-based incentive plans. Our unvested share-based awards are considered participating securities and are reflected in the calculation of diluted earnings per share. During periods of net loss, the assumed exercise of securities is anti-dilutive and is not included in the calculation of earnings per share. During 2014, the dilutive impact was less than $0.01 and during 2015 any common stock equivalents were anti-dilutive. | |
For all periods presented, the preferred stock was excluded from the calculation of earnings per share because the effect would not be dilutive. However, based on changing market conditions, the outstanding preferred stock could be dilutive in future periods. | |
Redemptions of Common Stock | |
We account for the possible redemption of our shares by classifying securities that are convertible for cash at the option of the holder outside of equity. We do not reclassify the shares to be redeemed from equity to a liability until such time as the redemption has been formally approved by our board of directors. The portion of the redeemed common stock in excess of the par value is charged to additional paid-in capital. | |
Reportable Segments | |
Our current business primarily consists of investing in and operating multifamily communities. Substantially all of our consolidated net income (loss) is from investments in real estate properties that we wholly own or own through Co-Investment Ventures, the latter of which may be accounted for under the equity method of accounting. Our management evaluates operating performance on an individual investment level. However, as each of our investments has similar economic characteristics in our consolidated financial statements, the Company is managed on an enterprise-wide basis with one reportable segment. | |
Use of Estimates in the Preparation of Financial Statements | |
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts included in the financial statements and accompanying notes to consolidated financial statements. These estimates include such items as: the purchase price allocations for real estate and other acquisitions; impairment of long-lived assets, notes receivable and equity-method real estate investments; fair value evaluations; earning recognition of noncontrolling interests and equity in earnings of investments in unconsolidated real estate joint ventures; depreciation and amortization; share-based compensation measurements; and recognition and timing of transition expenses. Actual results could differ from those estimates. |
New_Accounting_Pronouncements
New Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2015 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements |
In May 2014, the Financial Accounting Standards Board (“FASB”) issued updated guidance with respect to revenue recognition. The revised guidance outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance, including industry-specific revenue guidance. The revised guidance will replace most existing revenue and real estate sale recognition guidance in GAAP when it becomes effective. The standard specifically excludes lease contracts, which is our primary recurring revenue source. The revised guidance allows for the use of either the full or modified retrospective transition method and is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2016. Early adoption is not permitted. We have not yet selected a transition method and are currently evaluating the effect that the adoption of the revised guidance will have on our consolidated financial statements and related disclosures. | |
In August 2014, the FASB issued guidance with respect to management’s responsibility related to evaluating whether there is a substantial doubt about an entity’s ability to continue as a going concern as well as to provide related footnote disclosures. This guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2016. We are currently evaluating the effects of the newly issued guidance, but we do not believe the adoption of this guidance will have material impact on our disclosures. | |
In January 2015, the FASB issued guidance simplifying income statement presentation by eliminating the concept of extraordinary items. An entity will no longer be allowed to separately disclose extraordinary items, net of tax, in the income statement after income from continuing operations if an event or transaction is unusual in nature and occurs infrequently. This guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2015 with early adoption permitted and may be applied either prospectively or retrospectively. We do not believe the adoption of this guidance will have a material impact on our consolidated financial statements. | |
In February 2015, the FASB issued updated guidance related to accounting for consolidation of certain limited partnerships. This guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2015, with early adoption permitted. We are currently evaluating the impact this guidance will have on our consolidated financial statements when adopted. | |
In April 2015, the FASB issued guidance requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This guidance is effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption of this guidance is permitted for financial statements that have not been previously issued, and an entity should apply the new guidance on a retrospective basis, wherein the balance sheet of each individual period presented should be adjusted to reflect the period-specific effects of applying the new guidance. We are currently evaluating the impact this guidance will have on our consolidated financial statements when adopted. |
Real_Estate_Investments
Real Estate Investments | 3 Months Ended | ||||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||||
Real Estate [Abstract] | |||||||||||||||||||||||||
Real Estate Investments | Real Estate Investments | ||||||||||||||||||||||||
Real Estate Investments and Intangibles and Related Depreciation and Amortization | |||||||||||||||||||||||||
As of March 31, 2015 and December 31, 2014, major components of our real estate investments and intangibles and related accumulated depreciation and amortization were as follows (in millions): | |||||||||||||||||||||||||
March 31, 2015 | December 31, 2014 | ||||||||||||||||||||||||
Buildings | Intangibles | Buildings | Intangibles | ||||||||||||||||||||||
and | In-Place | Other | and | In-Place | Other | ||||||||||||||||||||
Improvements | Leases | Contractual | Improvements | Leases | Contractual | ||||||||||||||||||||
Cost | $ | 1,972.50 | $ | 40.7 | $ | 25.6 | $ | 2,033.80 | $ | 40.7 | $ | 25.6 | |||||||||||||
Less: accumulated depreciation and amortization | (291.4 | ) | (38.4 | ) | (7.5 | ) | (280.4 | ) | (38.3 | ) | (6.5 | ) | |||||||||||||
Net | $ | 1,681.10 | $ | 2.3 | $ | 18.1 | $ | 1,753.40 | $ | 2.4 | $ | 19.1 | |||||||||||||
Depreciation expense for the three months ended March 31, 2015 and 2014 was approximately $23.4 million and $21.4 million, respectively. | |||||||||||||||||||||||||
Cost of intangibles relates to the value of in-place leases and other contractual intangibles. Other contractual intangibles as of both March 31, 2015 and December 31, 2014 include $9.2 million of intangibles, primarily asset management and related fee revenue services and contracts related to our acquisition of a 1% general partner interest in 2013, $6.8 million related to the use rights of a parking garage and site improvements and $9.5 million of indefinite-lived contractual rights related to land air rights. | |||||||||||||||||||||||||
Amortization expense associated with our lease and other contractual intangibles for the three months ended March 31, 2015 and 2014 was approximately $1.0 million and $1.1 million, respectively. | |||||||||||||||||||||||||
Anticipated amortization associated with lease and other contractual intangibles for each of the following five years is as follows (in millions): | |||||||||||||||||||||||||
Anticipated Amortization | |||||||||||||||||||||||||
Year | of Intangibles | ||||||||||||||||||||||||
April through December 2015 | $ | 1.8 | |||||||||||||||||||||||
2016 | 1.4 | ||||||||||||||||||||||||
2017 | 1.4 | ||||||||||||||||||||||||
2018 | 0.5 | ||||||||||||||||||||||||
2019 | 0.5 | ||||||||||||||||||||||||
Developments | |||||||||||||||||||||||||
For the three months ended March 31, 2015 and 2014, we capitalized the following amounts of interest, real estate taxes and overhead related to our developments (in millions): | |||||||||||||||||||||||||
For the Three Months Ended | |||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||
Interest | $ | 4.8 | $ | 4.1 | |||||||||||||||||||||
Real estate taxes | 1.5 | 1.5 | |||||||||||||||||||||||
Overhead | 0.2 | 0.2 | |||||||||||||||||||||||
Sales of Real Estate Reported in Continuing Operations | |||||||||||||||||||||||||
The following table presents our sale of real estate for the three months ended March 31, 2014 (in millions). There were no sales of real estate for the three months ended March 31, 2015. | |||||||||||||||||||||||||
Date of Sale | Multifamily Community | Sales Contract Price | Net Cash Proceeds | Gain on Sale of Real Estate | |||||||||||||||||||||
Feb-14 | Tupelo Alley | $ | 52.9 | $ | 33.1 | $ | 16.2 | ||||||||||||||||||
The following table presents net income related to the Tupelo Alley multifamily community for the three months ended March 31, 2014 and includes the gain on sale of real estate (in millions): | |||||||||||||||||||||||||
For the Three Months Ended | |||||||||||||||||||||||||
March 31, 2014 | |||||||||||||||||||||||||
Net income (loss) from multifamily community sold in 2014 | $ | 15.8 | |||||||||||||||||||||||
Less: net income attributable to noncontrolling interest | (7.2 | ) | |||||||||||||||||||||||
Net income (loss) attributable to common stockholders | $ | 8.6 | |||||||||||||||||||||||
Real Estate Held for Sale | |||||||||||||||||||||||||
As of March 31, 2015, we had a 298-unit multifamily community, Burnham Pointe, located in Chicago, IL, which was classified as real estate held for sale. A purchase and sale agreement was signed in February 2015 for a gross sales price of $126.0 million. The agreement is subject to various closing conditions. We had no real estate held for sale as of December 31, 2014. The major classes of assets and obligations associated with real estate held for sale are as follows (in millions): | |||||||||||||||||||||||||
March 31, 2015 | |||||||||||||||||||||||||
Land | $ | 10.4 | |||||||||||||||||||||||
Buildings and improvements, net of approximately $12.4 million in accumulated depreciation | 65.7 | ||||||||||||||||||||||||
Other assets, net | 0.5 | ||||||||||||||||||||||||
Assets associated with real estate held for sale | $ | 76.6 | |||||||||||||||||||||||
Accounts payable and other liabilities | $ | 0.7 | |||||||||||||||||||||||
Obligations associated with real estate held for sale | $ | 0.7 | |||||||||||||||||||||||
Variable_Interest_Entities
Variable Interest Entities | 3 Months Ended |
Mar. 31, 2015 | |
Variable Interest Entities | |
Variable Interest Entities | Variable Interest Entities |
As of March 31, 2015 and December 31, 2014, we have concluded that we are the primary beneficiary of 15 VIEs. All of these VIEs are the property entities of PGGM CO-JVs or Developer CO-JVs created for the purpose of developing and operating multifamily communities. At the inception of each Property Entity, we had determined that none of the Co-Investment Ventures were VIEs and because we were the general partner and/or managing member (directly or indirectly) of each Co-Investment Venture and had control of their operations and business affairs, we consolidated each Co-Investment Venture. After separate reconsideration events from 2012 through the present, all of which were related to new financings or capital restructuring, we have concluded that all of these Co-Investment Ventures are now VIEs. Because these Co-Investment Ventures were previously consolidated, the VIE determination did not affect our financial position, financial operations or cash flows. Our ownership interest in each of the Co-Investment Ventures based upon contributed capital ranges from 55% to 100%. | |
The significant amounts of assets and liabilities related to our consolidated VIEs are identified parenthetically on our accompanying consolidated balance sheets. Twelve VIEs, all of which are actively developing or operating multifamily communities, have closed aggregate construction financing commitments of $587.9 million as of March 31, 2015, which we expect to be substantially drawn on during the construction of the developments. As of March 31, 2015, $322.0 million has been drawn under these construction loans. For ten of these construction loans, we have provided partial payment guarantees ranging from 10% to 25% of the total construction loan. The total commitment of these ten construction loans is $534.7 million, of which $272.2 million is outstanding as of March 31, 2015. Each guarantee may terminate or be reduced upon completion of the development or if the development achieves certain operating results. On the other two construction loans, the lenders have no recourse to us other than a guaranty provided by the Company with respect to the construction of the project (a completion guaranty). The construction loans are secured by a first mortgage in each multifamily community. See Note 8, “Mortgages and Notes Payable” for further information on our construction loans. The total assets of the VIEs are $971.7 million and $906.9 million as of March 31, 2015 and December 31, 2014, respectively, $654.7 million and $582.3 million of which is reflected in construction in progress, respectively. The total net operating real estate of the VIEs is $294.3 million and $282.1 million as of March 31, 2015 and December 31, 2014, respectively. |
Other_Assets
Other Assets | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Other Assets [Abstract] | |||||||||
Other Assets | Other Assets | ||||||||
The components of other assets are as follows (in millions): | |||||||||
March 31, 2015 | December 31, 2014 | ||||||||
Notes receivable, net (a) | $ | 59.8 | $ | 59.8 | |||||
Escrows and restricted cash | 7.9 | 8 | |||||||
Deferred financing costs, net | 18.8 | 17.4 | |||||||
Resident, tenant and other receivables | 16.2 | 14 | |||||||
Prepaid assets, deposits and other assets | 6.7 | 6.1 | |||||||
Investment in unconsolidated real estate joint venture | 5.1 | 5 | |||||||
Total other assets | $ | 114.5 | $ | 110.3 | |||||
(a) | Notes receivable include mezzanine loans, primarily related to multifamily development projects. As of March 31, 2015, the weighted average interest rate is 14.7% and the remaining years to scheduled maturity is 0.8 years. Notes receivable are all generally pre-payable at the option of the borrowers. |
Leasing_Activity
Leasing Activity | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Leases [Abstract] | |||||
Leasing Activity | Leasing Activity | ||||
In addition to multifamily residential units, certain of our consolidated multifamily communities have retail areas representing approximately 1% of total rentable area of our consolidated multifamily communities. Future minimum base rental receipts due to us under these non-cancelable retail leases with initial terms greater than one year in effect as of March 31, 2015 are as follows (in millions): | |||||
Future Minimum | |||||
Year | Lease Receipts | ||||
April through December 2015 | $ | 2.9 | |||
2016 | 3.8 | ||||
2017 | 3.8 | ||||
2018 | 3.6 | ||||
2019 | 3.6 | ||||
Thereafter | 26.4 | ||||
Total | $ | 44.1 | |||
Mortgages_and_Notes_Payable
Mortgages and Notes Payable | 3 Months Ended | ||||||||||||
Mar. 31, 2015 | |||||||||||||
Debt Disclosure [Abstract] | |||||||||||||
Mortgages and Notes Payable | Mortgages and Notes Payable | ||||||||||||
The following table summarizes the carrying amounts of the mortgages and notes payable classified by whether the obligation is ours or that of the applicable consolidated Co-Investment Venture as of March 31, 2015 and December 31, 2014 (dollar amounts in millions and monthly LIBOR at March 31, 2015 is 0.18%): | |||||||||||||
As of March 31, 2015 | |||||||||||||
March 31, | December 31, | Wtd. Average | |||||||||||
2015 | 2014 | Interest Rates | Maturity Dates | ||||||||||
Company level (a) | |||||||||||||
Fixed rate mortgages payable | $ | 87.2 | $ | 87.2 | 3.95% | 2018 to 2020 | |||||||
Variable rate construction loans payable (b) | 50 | 33 | Monthly LIBOR + 2.12% | 2017 to 2018 | |||||||||
Total Company level | 137.2 | 120.2 | |||||||||||
Co-Investment Venture level - consolidated (c) | |||||||||||||
Fixed rate mortgages payable | 773.3 | 827.7 | 3.70% | 2015 to 2020 | |||||||||
Variable rate mortgage payable | 11.9 | 12 | Monthly LIBOR + 2.35% | 2017 | |||||||||
Fixed rate construction loans payable (d) | 63.1 | 57 | 4.14% | 2016 to 2018 | |||||||||
Variable rate construction loans payable (e) | 242.9 | 165.3 | Monthly LIBOR + 2.10% | 2016 to 2018 | |||||||||
1,091.20 | 1,062.00 | ||||||||||||
Plus: unamortized adjustments from business combinations | 3.8 | 4.3 | |||||||||||
Total Co-Investment Venture level - consolidated | 1,095.00 | 1,066.30 | |||||||||||
Total consolidated mortgages and notes payable | $ | 1,232.20 | $ | 1,186.50 | |||||||||
(a) | Company level debt is defined as debt that is a direct or indirect obligation of the Company or its wholly owned subsidiaries. Company level debt includes the applicable portion of Co-Investment debt where the Company has provided full or partial guarantees for the repayment of the debt. | ||||||||||||
(b) | Includes the amount of the Co-Investment Venture level construction loans payable that is guaranteed by the Company. As of March 31, 2015, the Company has partially guaranteed ten loans with total commitments of $534.7 million. These loans include one to two year extension options. Our percentage guarantee on each of these loans ranges from 10% to 25% and the amount of our current guarantee and the maximum guarantee based on the commitment as of March 31, 2015 is $50.0 million and $103.9 million, respectively. The non-recourse portion of the loans outstanding as of March 31, 2015 is reported in the Co-Investment Venture level construction loans payable. | ||||||||||||
(c) | Co-Investment Venture level debt is defined as debt that is an obligation of the Co-Investment Venture and | ||||||||||||
not an obligation or contingency for us. | |||||||||||||
(d) | Includes two loans with total commitments of $84.8 million. One of the construction loans has an option to convert into a permanent loan with a maturity of 2023. | ||||||||||||
(e) | Includes eleven loans with total commitments of $556.6 million. These loans include one to two year extension options. The amount guaranteed by the Company is reported as Company level debt as discussed in footnote (b) above. | ||||||||||||
As of March 31, 2015, $2.5 billion of the net consolidated carrying value of real estate collateralized the mortgages and notes payable. We believe we are in compliance with all financial covenants as of March 31, 2015. | |||||||||||||
As of March 31, 2015, contractual principal payments for our mortgages and notes payable for the five subsequent years and thereafter are as follows (in millions): | |||||||||||||
Co-Investment | Total | ||||||||||||
Year | Company Level | Venture Level | Consolidated | ||||||||||
April through December 2015 | $ | 0.2 | $ | 29.1 | $ | 29.3 | |||||||
2016 | 0.6 | 185.5 | 186.1 | ||||||||||
2017 | 14.6 | 266.8 | 281.4 | ||||||||||
2018 | 66.8 | 316.4 | 383.2 | ||||||||||
2019 | 1.1 | 219.4 | 220.5 | ||||||||||
Thereafter | 53.9 | 74 | 127.9 | ||||||||||
Total | $ | 137.2 | $ | 1,091.20 | 1,228.40 | ||||||||
Add: unamortized adjustments from business combinations | 3.8 | ||||||||||||
Total mortgages and notes payable | $ | 1,232.20 | |||||||||||
Credit_Facilities_Payable
Credit Facilities Payable | 3 Months Ended | |||||||||||||
Mar. 31, 2015 | ||||||||||||||
Line of Credit Facility [Abstract] | ||||||||||||||
Credit Facility Payable | Credit Facilities Payable | |||||||||||||
We have two credit facilities as of March 31, 2015: a $150 million credit facility (the “$150 Million Facility”) and a $200 million revolving credit facility (the “$200 Million Facility”). The following table presents the amounts outstanding under the two credit facilities as of March 31, 2015 and December 31, 2014 (dollar amounts in millions, and monthly LIBOR at March 31, 2015 is 0.18%): | ||||||||||||||
Balance Outstanding | ||||||||||||||
31-Mar-15 | 31-Dec-14 | Interest Rate as of March 31, 2015 | Maturity Date | |||||||||||
$150 Million Facility | $ | 35 | $ | 10 | Monthly LIBOR + 2.08% | April 1, 2017 | ||||||||
$200 Million Facility | — | — | Monthly LIBOR + 2.50% | January 14, 2019 | ||||||||||
Total | $ | 35 | $ | 10 | ||||||||||
The $150 Million Facility matures on April 1, 2017, when all unpaid principal and interest is due. Borrowing tranches under the $150 Million Facility bear interest at a “base rate” based on either the one-month or three-month LIBOR rate, selected at our option, plus an applicable margin which adjusts based on the facility’s debt service requirements. As of March 31, 2015, the applicable margin was 2.08% and the base rate was 0.18% based on one-month LIBOR, which adjusts based on debt service coverage, as defined. The $150 Million Facility also provides for fees based on unutilized amounts and minimum usage. The loan requires minimum borrowing of $10.0 million and monthly interest-only payments and monthly or annual payment of fees. | ||||||||||||||
Draws under the $150 Million Facility are secured by a pool of certain wholly owned multifamily communities. We have the ability to add and remove multifamily communities from the collateral pool, pursuant to the requirements under the credit facility agreement. We may also add multifamily communities in our discretion in order to increase amounts available for borrowing. As of March 31, 2015, $164.0 million of the net carrying value of real estate collateralized the $150 Million Facility. The aggregate borrowings under the $150 Million Facility are limited to 70% of the value of the collateral pool, which may be different than the carrying value for financial statement reporting. As of March 31, 2015, we may make total draws of $150 million under the $150 Million Facility based upon the value of the collateral pool. If the multifamily community classified as held for sale as of March 31, 2015, is sold, our availability to draw would be reduced to approximately $87 million, until such time as the collateral pool is restored. We currently intend to restore the collateral pool to the pre-sale availability. | ||||||||||||||
The $150 Million Facility agreement contains customary provisions with respect to events of default, covenants and borrowing conditions. In particular, the $150 Million Facility agreement requires us to maintain a consolidated net worth of at least $150.0 million, liquidity of at least $15.0 million and net operating income of the collateral pool to be no less than 155% of the facility debt service cost. Certain prepayments may be required upon a breach of covenants or borrowing conditions. We believe we are in compliance with all provisions as of March 31, 2015. | ||||||||||||||
In January 2015, we entered into the $200 Million Facility. The $200 Million Facility matures on January 14, 2019, and may be extended for an additional one year term at our option. Borrowing tranches bear interest at rates based on defined leverage ratios, which as of March 31, 2015 would be LIBOR + 2.50%. The $200 Million Facility also provides for fees based on unutilized amounts and minimum usage. We may increase the size of the $200 Million Facility from $200 million up to a total of $400 million after satisfying certain conditions. | ||||||||||||||
Draws under the $200 Million Facility are primarily supported by equity pledges of our wholly owned subsidiaries and are secured by a first mortgage lien and an assignment of leases and rents against two wholly owned multifamily communities and any properties later added by us, in addition to a first priority perfected assignment of a portion of certain of our notes receivable. | ||||||||||||||
The $200 Million Facility agreement contains customary provisions with respect to events of default, covenants and borrowing conditions. In particular, the $200 Million Facility agreement requires us to maintain a consolidated net worth of at least $1.16 billion, consolidated total indebtedness to total gross asset value of less than 65%, and adjusted consolidated earnings before interest, taxes, depreciation and amortization (“EBITDA”) to consolidated fixed charges of not less than 1.50 to 1. Beginning December 31, 2015, our $200 Million Facility agreement may also limit our ability to pay distributions in excess of 95% of our funds from operations generally calculated in accordance with the current definition of funds from operations adopted by the National Association of Real Estate Investment Trusts. For the three months ended March 31, 2015, our declared distributions were 83% of such defined funds from operations during such period. We believe we are in compliance with all provisions of the $200 Million Facility agreement as of March 31, 2015. |
Noncontrolling_Interests
Noncontrolling Interests | 3 Months Ended | ||||||||||||
Mar. 31, 2015 | |||||||||||||
Noncontrolling Interest [Abstract] | |||||||||||||
Noncontrolling Interests | Noncontrolling Interests | ||||||||||||
Non-redeemable Noncontrolling Interests | |||||||||||||
Non-redeemable noncontrolling interests for the Co-Investment Venture partners represent their proportionate share of the equity in consolidated real estate ventures. Each noncontrolling interest is not redeemable by the holder, and accordingly, is reported as equity. Income and losses are allocated to the noncontrolling interest holders based on their effective ownership percentage. This effective ownership is indicative of, but may differ from, percentages for distributions, contributions or financing requirements. | |||||||||||||
As of March 31, 2015 and December 31, 2014, non-redeemable noncontrolling interests (“NCI”) consisted of the following, including the direct and non-direct noncontrolling interests ownership ranges where applicable (dollar amounts in millions): | |||||||||||||
March 31, 2015 | December 31, 2014 | ||||||||||||
Effective | Effective | ||||||||||||
Amount | NCI % (a) | Amount | NCI % (a) | ||||||||||
PGGM Co-Investment Partner | $ | 377.8 | 26% to 45% | $ | 390.5 | 26% to 45% | |||||||
MW Co-Investment Partner | 142.6 | 45% | 144.9 | 45% | |||||||||
Developer Partners | 3.5 | 0% | 3.4 | 0% | |||||||||
Subsidiary preferred units | 2.1 | (b) | 1.9 | (b) | |||||||||
Total non-redeemable NCI | $ | 526 | $ | 540.7 | |||||||||
(a) Effective noncontrolling percentage is based upon the noncontrolling interest’s participation in distributable operating cash. This effective ownership is indicative of, but may differ over time from, percentages for distributions, contributions or financing requirements. | |||||||||||||
(b) | The effective NCI for the preferred units is not meaningful and the preferred units have no voting rights. | ||||||||||||
Each noncontrolling interest relates to ownership interests in CO-JVs where we have substantial operational control rights. In the case of the PGGM Co-Investment Partner, their noncontrolling interest includes an interest in the Master Partnership and the PGGM CO-JVs. For PGGM CO-JVs and MW CO-JVs, capital contributions and distributions are generally made pro rata in accordance with these ownership interests; however, the Master Partnership’s and the PGGM CO-JV’s pro rata interests are subject to a promoted interest to us if certain performance returns are achieved. Developer CO-JVs generally have limited participation in contributions and generally only participate in distributions after certain preferred returns are collected by us or the PGGM CO-JVs, as applicable, which in some cases may not be until we have received all of our investment capital. None of these Co-Investment Venture partners have any rights to put or redeem their ownership interest; however, they generally provide for buy/sell rights after certain periods. In certain circumstances the governing documents of the PGGM CO-JV or MW CO-JV may require a sale of the Co-Investment Venture or its subsidiary REIT rather than an asset sale. | |||||||||||||
Noncontrolling interests also include between 121 to 125 preferred units issued by a subsidiary of each of the PGGM CO-JVs and the MW CO-JVs in order for such subsidiaries to qualify as a REIT for federal income tax purposes. The subsidiary preferred units pay an annual fixed distribution of 12.5% on their face value and are senior in priority to all other members’ equity. The PGGM CO-JVs and MW CO-JVs may cause the subsidiary REIT, at their option, to redeem the subsidiary preferred units in whole or in part, at any time for cash at a redemption price of $500 per unit (the face value), plus all accrued and unpaid distributions thereon to and including the date fixed for redemption, plus a premium per unit generally of $50 to $100 for the first year which generally declines in value $25 per unit each year until there is no redemption premium remaining. The subsidiary preferred units are not redeemable by the unit holders and as of March 31, 2015, we have no current intent to exercise our redemption option. Accordingly, these noncontrolling interests are reported as equity. | |||||||||||||
For the three months ended March 31, 2015 and 2014, we paid the following distributions to noncontrolling interests (in millions): | |||||||||||||
For the Three Months Ended | |||||||||||||
March 31, | |||||||||||||
2015 | 2014 | ||||||||||||
Distributions paid to noncontrolling interests: | |||||||||||||
Operating activities | $ | 6 | $ | 5.7 | |||||||||
Investing and financing activities | 17 | 14.9 | |||||||||||
Total | $ | 23 | $ | 20.6 | |||||||||
On February 28, 2014, we sold approximately 37% noncontrolling interest in two Developer CO-JVs to PGGM for $13.2 million. No gain or loss was recognized in recording these transactions, but a net decrease to additional paid-in capital of $0.8 million was recorded. | |||||||||||||
In May 2015, we acquired noncontrolling interests and controlling interests in seven PGGM CO-JVs. See Note 17, “Subsequent Events” for further information. | |||||||||||||
Redeemable Noncontrolling Interests | |||||||||||||
As of March 31, 2015 and December 31, 2014, redeemable noncontrolling interests (“NCI”) consisted of the following (dollar amounts in millions): | |||||||||||||
March 31, 2015 | December 31, 2014 | ||||||||||||
Effective | Effective | ||||||||||||
Amount | NCI % (a) | Amount | NCI % (a) | ||||||||||
Developer Partners | $ | 32 | 0% to 10% | $ | 32 | 0% to 10% | |||||||
(a) Effective noncontrolling interest percentage is based upon the noncontrolling interest’s participation in distributable operating cash. This effective ownership is indicative of, but may differ from, percentages for distributions, contributions or financing requirements. For Co-Investment Ventures where the developer’s equity has been returned, the effective noncontrolling interest percentage is shown as zero. | |||||||||||||
Developer Partners included in redeemable noncontrolling interests represent ownership interests in Developer CO-JVs by regional or national multifamily developers, which may require that we pay or reimburse our Developer Partners upon certain events. These amounts include reimbursing partners once certain development milestones are achieved, generally related to entitlements, permits or final budgeted construction costs. They also generally have put options, usually exercisable one year after completion of the development and thereafter, pursuant to which we would be required to acquire their ownership interest at a set price and options to require a sale of the development generally after the seventh year after completion of the development at the then current fair value. These Developer CO-JVs also include buy/sell provisions, generally available after the tenth year after completion of the development. Each of these Developer CO-JVs is managed by a subsidiary of ours. As manager, we have substantial operational control rights. These Developer CO-JVs generally provide that we have a preferred cash flow distribution until we receive certain returns on and of our investment. All of these Developer Partners also have a back end interest, generally only attributable to distributions related to a property sale or financing. Generally, these noncontrolling interests have no obligation to make any additional capital contributions. |
Stockholders_Equity
Stockholders' Equity | 3 Months Ended | ||||||
Mar. 31, 2015 | |||||||
Equity [Abstract] | |||||||
Stockholders' Equity | Stockholders’ Equity | ||||||
Capitalization | |||||||
In connection with our transition to self-management, on July 31, 2013, we issued 10,000 shares of a new Series A non-participating, voting, cumulative, 7.0% convertible preferred stock, par value $0.0001 per share (the “Series A Preferred Stock”), to Behringer. The shares of Series A Preferred Stock entitle the holder to one vote per share on all matters submitted to the holders of the common stock, a liquidation preference equal to $10.00 per share before the holders of common stock are paid any liquidation proceeds, and 7.0% cumulative cash dividends on the liquidation preference and any accrued and unpaid dividends. | |||||||
As determined and limited pursuant to the Articles Supplementary establishing the Series A Preferred Stock, the Series A Preferred Stock will automatically convert into shares of our common stock on the earlier of December 31, 2016, or the election by the holders of a majority of the then outstanding shares of Series A Preferred Stock. At conversion, all of the shares of Series A Preferred Stock will, in total, generally convert into an amount of shares of our common stock equal in value to 17.25% of the excess, if any, of (i) (a) the per share value of our common stock at the time of conversion, as determined pursuant to the Articles Supplementary establishing the Series A Preferred Stock and assuming no shares of the Series A Preferred Stock are outstanding, multiplied by the number of shares of common stock outstanding on July 31, 2013, plus (b) the aggregate value of distributions (including distributions constituting a return of capital) paid through such time on the shares of common stock outstanding on July 31, 2013 over (ii) the aggregate issue price of those outstanding shares plus a 7% cumulative, non-compounded, annual return on the issue price of those outstanding shares. The conversion option terminates December 31, 2016. | |||||||
Stock Plans | |||||||
Our Second Amended and Restated Incentive Award Plan (the “Incentive Award Plan”) authorizes the grant of non-qualified and incentive stock options, restricted stock awards, restricted stock units, stock appreciation rights, dividend equivalents and other stock-based awards. A total of 20 million shares has been authorized for issuance under the Incentive Award Plan as of March 31, 2015. | |||||||
Restricted Stock Units | |||||||
As of March 31, 2015, we had 638,800 restricted stock units outstanding, held by our directors and certain executive employees. These restricted stock units generally vest over a three year period. The following is a summary of the number of restricted stock units issued, exercised and outstanding as of March 31, 2015 and 2014: | |||||||
March 31, 2015 | March 31, 2014 | ||||||
Outstanding at the beginning of the period | 254,691 | 6,000 | |||||
Issued (a) | 424,799 | 239,220 | |||||
Exercised | (40,690 | ) | — | ||||
Outstanding at the end of the period | 638,800 | 245,220 | |||||
(a) | Units issued in 2015 had a grant price of $9.42 per unit. Units issued in 2014 had a grant price of $10.03 per unit. As of March 31, 2015, 82,897 units are vested. | ||||||
Restricted Stock | |||||||
As of March 31, 2015, we had 22,521 shares of restricted stock outstanding, held by employees. Restrictions on these shares lapse in equal increments over the three-year period following the grant date. Compensation cost is measured at the grant date, based on the estimated fair value of the award and is recognized as expense over the service period based on a tiered lapse schedule and estimated forfeiture rates. The following is a summary of the restricted stock issued, forfeited and outstanding as of March 31, 2015 and 2014: | |||||||
March 31, 2015 | March 31, 2014 | ||||||
Outstanding at the beginning of the year | — | — | |||||
Issued (a) | 25,777 | — | |||||
Forfeited | (3,256 | ) | — | ||||
Outstanding at the end of the period | 22,521 | — | |||||
(a) | Shares issued in 2015 had a grant price of $9.21 per share. | ||||||
For the three months ended March 31, 2015 and 2014, we had approximately $0.5 million and $0.2 million, respectively, in compensation costs related to share-based payments including dividend equivalent payments. | |||||||
Distributions | |||||||
On August 12, 2014, in anticipation of the Company’s listing on a national securities exchange, our board of directors elected to suspend our distribution reinvestment plan (“DRIP”) effective August 24, 2014. On November 4, 2014, our board of directors approved the termination of the DRIP. As a result, all distributions paid subsequent to August 24, 2014 were paid in cash and not reinvested in shares of our common stock. | |||||||
From April 1, 2012 through September 30, 2014, our distributions were in a daily amount of $0.000958904 ($0.35 annualized) per share of common stock. Beginning with the fourth quarter of 2014, the board of directors began to authorize regular distributions to be paid to stockholders of record with respect to a single record date each quarter. Our board of directors authorized a distribution in the amount of $0.075 per share on all outstanding shares of common stock of the Company for the fourth quarter of 2014. The distribution was paid on January 5, 2015 to stockholders of record at the close of business on December 29, 2014. Our board of directors also authorized a distribution in the amount of $0.075 per share on all outstanding shares of common stock of the Company for the first quarter of 2015. The distribution was paid on April 8, 2015 to stockholders of record at the close of business on March 31, 2015. | |||||||
Share Redemption Program | |||||||
On August 12, 2014, in anticipation of the Company’s listing on a national securities exchange, our board of directors also elected to suspend our share redemption program (“SRP”), effective August 14, 2014, and on November 4, 2014, our board of directors approved the termination of the SRP. For the three months ended March 31, 2014, we redeemed approximately 794,188 common shares at an average price of $8.81 per share for $7.0 million. |
Transition_Expenses
Transition Expenses | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Transition to Self-Management [Abstract] | |||||
Transition Expenses | Transition Expenses | ||||
On July 31, 2013 (the “Initial Closing”), we entered into a series of agreements and amendments to our then-existing agreements and arrangements with Behringer, setting forth various terms of and conditions to the modification of the business relationships between us and Behringer. We collectively refer to these agreements as the “Self-Management Transition Agreements.” From the Initial Closing through June 30, 2014, we hired executives and staff who were previously employees of Behringer and began hiring other employees, completing our transition to a self-managed company. | |||||
Commencing at the Initial Closing, the Self-Management Transition Agreements provide that in certain circumstances, Behringer will rebate to us, or may provide us a credit with respect to, acquisition fees paid pursuant to the amended and restated advisory management agreement. For the three months ended March 31, 2015 and 2014, $0.1 million and $2.5 million, respectively, of acquisition fees were credited to us. | |||||
During the period from the Initial Closing through September 30, 2014, Behringer provided general transition services in support of our transition to self-management for a total cost of $7.2 million. For the three months ended March 31, 2014, $0.1 million was expensed. | |||||
In addition to the above transactions, the Company incurred other expenses related to our transition to self-management, primarily related to Special Committee and Company legal and financial advisors and general transition services (primarily staffing, name change, notices, insurance, information technology and facilities). | |||||
The table below represents the components of our transition expenses for the three months ended March 31, 2014 (in millions). We did not incur any transition expenses for the three months ended March 31, 2015. | |||||
For the Three Months Ended | |||||
March 31, 2014 | |||||
Special Committee and Company legal and financial advisors | $ | 0.2 | |||
General transition services: | |||||
Behringer | 0.2 | ||||
Other service providers | 0.1 | ||||
Total transition expenses | $ | 0.5 | |||
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Commitments and Contingencies Disclosure [Abstract] | |||||
Commitments and Contingencies | Commitments and Contingencies | ||||
All of our Co-Investment Ventures include buy/sell provisions. Under most of these provisions and during specific periods, a partner could make an offer to purchase the interest of the other partner and the other partner would have the option to accept the offer or purchase the offering partner’s interest at that price. As of March 31, 2015, no such buy/sell offers are outstanding. | |||||
In the ordinary course of business, the multifamily communities in which we have investments may have commitments to provide affordable housing. Under these arrangements, we generally receive from the resident a below market rent, which is determined by a local or national authority. In certain arrangements, a local or national housing authority makes payments covering some or substantially all of the difference between the restricted rent paid by residents and market rents. In connection with our acquisition of The Gallery at NoHo Commons, we assumed an obligation to provide affordable housing through 2048. As partial reimbursement for this obligation, the California housing authority will make level annual payments of approximately $2.0 million through 2028 and no reimbursement for the remaining 20-year period. We may also be required to reimburse the California housing authority if certain operating results are achieved on a cumulative basis during the term of the agreement. At the acquisition, we recorded a liability of $14.0 million based on the fair value of the terms over the life of the agreement. In addition, we record rental revenue from the California housing authority on a straight-line basis, deferring a portion of the collections as deferred lease revenues. As of March 31, 2015 and December 31, 2014, we have approximately $18.0 million and $18.3 million, respectively, of carrying value for deferred lease revenues related to The Gallery at NoHo Commons. | |||||
As of March 31, 2015, we have entered into construction and development contracts with $309.5 million remaining to be paid. These construction costs are expected to be paid during the completion of the development and construction period, generally within 24 months. | |||||
Future minimum lease payments due on our lease commitment payables, primarily related to our corporate office lease which expires in 2024, are as follows (in millions): | |||||
Future Minimum Lease Payments | |||||
April 2015 through December 2015 | $ | 0.5 | |||
2016 | 0.6 | ||||
2017 | 0.8 | ||||
2018 | 0.8 | ||||
2019 | 0.8 | ||||
Thereafter | 4 | ||||
Total | $ | 7.5 | |||
We are also subject to various legal proceedings and claims which arise in the ordinary course of business. Matters which relate to property damage or general liability claims are generally covered by insurance. While the resolution of these legal proceedings and claims cannot be predicted with certainty, management believes the final outcome of such matters will not have a material adverse effect on our consolidated financial statements. |
Fair_Value_of_Derivatives_and_
Fair Value of Derivatives and Financial Instruments | 3 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
Fair Value of Derivatives and Financial Instruments | Fair Value of Derivatives and Financial Instruments | ||||||||||||||||
Fair value measurements are determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy) has been established. | |||||||||||||||||
Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets and liabilities that we have the ability to access. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability that are typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. | |||||||||||||||||
In connection with our measurements of fair value related to financial instruments, there are generally not available observable market price inputs for substantially the same items. Accordingly, these are classified as Level 3, and we make assumptions and use various estimates and pricing models, including, but not limited to, the discount and interest rates used to determine present values. These estimates are from the perspective of market participants. A change in these estimates and assumptions could be material to our results of operations and financial condition. | |||||||||||||||||
For the three months ended March 31, 2015 and 2014, we had no fair value adjustments on a recurring or nonrecurring basis. | |||||||||||||||||
Financial Instruments Not Carried at Fair Value | |||||||||||||||||
Financial instruments held as of March 31, 2015 and December 31, 2014 and not measured at fair value on a recurring basis include cash and cash equivalents, notes receivable, credit facility payable and mortgages and notes payable. With the exception of our mortgages and notes payable, the financial statement carrying amounts of these items approximate their fair values due to their short-term nature. Because the credit facility payable bears interest at a variable rate and has a prepayment option, we believe its carrying amount approximates its fair value. | |||||||||||||||||
Estimated fair values for mortgages and notes payable have been determined using market pricing for similar mortgages payable, which are classified as Level 2 in the fair value hierarchy. Carrying amounts and the related estimated fair value of our mortgages and notes payable as of March 31, 2015 and December 31, 2014 are as follows (in millions): | |||||||||||||||||
March 31, 2015 | December 31, 2014 | ||||||||||||||||
Carrying | Fair | Carrying | Fair | ||||||||||||||
Amount | Value | Amount | Value | ||||||||||||||
Mortgages and notes payable | $ | 1,232.20 | $ | 1,246.40 | $ | 1,186.50 | $ | 1,199.60 | |||||||||
Related_Party_Arrangements
Related Party Arrangements | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Related Party Transactions [Abstract] | |||||||||
Related Party Arrangements | Related Party Arrangements | ||||||||
From our inception to July 31, 2013, we had no employees, were externally managed by Behringer and were supported by related party service agreements, as further described below. Through July 31, 2013, we exclusively relied on Behringer to provide certain services and personnel for management and day-to-day operations, including advisory services and property management services provided or performed by Behringer. | |||||||||
Effective July 31, 2013, we entered into the Self-Management Transition Agreements as discussed in Note 12, “Transition Expenses.” From the Initial Closing through June 30, 2014, we hired executives and staff who were previously employees of Behringer and began hiring other employees, completing our transition to a self-managed company. Behringer provides capital market services to the Company for a fee ranging from 0.9% to 1.0%. Such capital market services expire on June 30, 2015. | |||||||||
The services provided by Behringer included acquisition and advisory, property management, capital market, and asset management services. The table below shows the fees and expense reimbursements to Behringer in exchange for such services for the three months ended March 31, 2015 and 2014 (in millions): | |||||||||
For the Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Acquisition and advisory fees | $ | — | $ | 1.8 | |||||
Property management fees | — | 5.5 | |||||||
Debt financing fees | 0.2 | 0.2 | |||||||
Asset management fees | — | 1.9 | |||||||
Administrative expense reimbursements | — | 0.4 | |||||||
Supplemental_Disclosures_of_Ca
Supplemental Disclosures of Cash Flow Information | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Supplemental Cash Flow Information [Abstract] | |||||||||
Supplemental Disclosures of Cash Flow Information | Supplemental Disclosures of Cash Flow Information | ||||||||
Supplemental cash flow information is summarized below (in millions): | |||||||||
For the Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Supplemental disclosure of cash flow information: | |||||||||
Interest paid, net of amounts capitalized of $4.8 million and $4.1 million in 2015 and 2014, respectively | $ | 7.8 | $ | 6.8 | |||||
Non-cash investing and financing activities: | |||||||||
Transfer of real estate from construction in progress to operating real estate | 14.8 | 39.4 | |||||||
Transfer of assets to assets associated with real estate held for sale | 76.6 | — | |||||||
Stock issued pursuant to our DRIP | — | 7.6 | |||||||
Distributions payable - regular | 12.5 | 5 | |||||||
Construction costs and other related payables | 64 | 50.8 | |||||||
Subsequent_Events
Subsequent Events | 3 Months Ended | ||||||||||||
Mar. 31, 2015 | |||||||||||||
Subsequent Events [Abstract] | |||||||||||||
Subsequent Events | Subsequent Events | ||||||||||||
We have evaluated subsequent events for recognition or disclosure in our consolidated financial statements. | |||||||||||||
Acquisition of Noncontrolling Interests and Controlling Interest | |||||||||||||
On May 7, 2015, we acquired six noncontrolling interests in PGGM CO-JVs, which relate to equity investments in six multifamily communities, and one controlling interest in a PGGM CO-JV, which relates to a debt investment in a multifamily community. The net purchase price was $119.5 million, exclusive of closing costs, and is subject to final determination of certain working capital amounts. The consideration for the acquisitions was paid in cash, with $9.5 million funded from existing cash balances and the remaining $110.0 million from draws under our credit facilities. In connection with the acquisitions, we also received a disposition fee of $1.0 million from PGGM and a promoted interest payment of $3.5 million from PGGM. | |||||||||||||
The following table summarizes the acquisitions of each of the multifamily community interests in the PGGM CO-JVs: | |||||||||||||
Our Ownership Interest (a) | |||||||||||||
Community and Location | Total Units | Pre- Acquisition | Acquired Interest | Post- Acquisition | |||||||||
Equity investments: | |||||||||||||
The District Universal Boulevard, Orlando, FL | 425 | 55.5 | % | 44.5 | % | 100 | % | ||||||
Veritas, Henderson, NV (b) | 430 | 51.9 | % | 41.6 | % | 93.5 | % | ||||||
The Cameron, Silver Spring, MD | 325 | 55.5 | % | 44.5 | % | 100 | % | ||||||
Skye 2905, Denver, CO | 400 | 55.5 | % | 44.5 | % | 100 | % | ||||||
Grand Reserve, Dallas, TX | 149 | 74.4 | % | 25.6 | % | 100 | % | ||||||
Stone Gate, Marlborough, MA | 332 | 55.5 | % | 44.5 | % | 100 | % | ||||||
2,061 | |||||||||||||
Debt investment: | |||||||||||||
Jefferson Creekside, Allen, TX | 444 | 55.5 | % | 44.5 | % | 100 | % | ||||||
(a) | Our ownership interest is based on our share of contributed capital. This ownership interest may differ over time from percentages for distributions, contributions or financing requirements for each respective CO-JV. The post-acquisition effective ownership interests based on our participation in distributable cash from the CO-JVs are the same as those presented based on contributed capital, except for Veritas where our post-acquisition effective ownership based on our current participation in distributable cash is 100%. Each of the equity investments was previously accounted for on the consolidated method of accounting with the same accounting method post-acquisition. The debt investment was previously accounted for on the equity method of accounting and post-acquisition will be accounted for on the consolidated method of accounting. | ||||||||||||
(b) | The remaining 6.5% is owned by a Developer Partner. | ||||||||||||
Because the equity investments were previously accounted for on the consolidated method of accounting, the acquisition of the investment interests will not change the carrying value for the related assets or liabilities or reported consolidated operations for revenues and expenses included in reported net income. The acquisition of the equity investments will reduce noncontrolling interests for the related amounts of the CO-JVs with the difference between the noncontrolling interest amounts and the purchase price recorded to additional paid in capital. Net income attributable to common stockholders is expected to increase for our share of the acquired investments net income in future periods. Similarly, the collection of the disposition fee revenue and promoted interest payment will be eliminated in reporting consolidated net income but will be recorded as an increase to net income attributable to common stockholders. The acquisition of the debt investment will result in a change from equity method accounting to the consolidated method of accounting and accordingly, the underlying assets and liabilities will be recorded at fair value, which substantially approximates the net carrying value of the equity investment. | |||||||||||||
Distribution for the Second Quarter of 2015 | |||||||||||||
Our board of directors has authorized a quarterly distribution in the amount of $0.075 per share on all outstanding shares of common stock of the Company for the second quarter of 2015. The quarterly distribution is payable July 7, 2015 to stockholders of record at the close of business on June 30, 2015. | |||||||||||||
* * * * * |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation |
The accompanying consolidated financial statements include our consolidated accounts and the accounts of our wholly owned subsidiaries. We also consolidate other entities in which we have a controlling financial interest or other entities (referred to as variable interest entities or “VIEs”) where we are determined to be the primary beneficiary. VIEs, as defined by GAAP, are generally entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders lack adequate decision making ability. The primary beneficiary is required to consolidate a VIE for financial reporting purposes. The determination of the primary beneficiary requires management to make significant estimates and judgments about our rights, obligations, and economic interests in such entities as well as the same of the other owners. See Note 5, “Variable Interest Entities” for further information about our VIEs. For entities in which we have less than a controlling financial interest or entities with respect to which we are not deemed to be the primary beneficiary, the entities are accounted for using the equity method of accounting. Accordingly, our share of the net earnings or losses of these entities is included in consolidated net income. See Note 6, “Other Assets” for further information on our unconsolidated investment. All inter-company accounts and transactions have been eliminated in consolidation. | |
Real Estate and Other Related Intangibles | Real Estate and Other Related Intangibles |
Acquisitions | |
For real estate properties acquired by us or our Co-Investment Ventures classified as business combinations, we determine the purchase price, after adjusting for contingent consideration and settlement of any pre-existing relationships. We record the acquired assets and liabilities based on their fair values, including tangible assets (consisting of land, any associated rights, buildings and improvements), identified intangible assets and liabilities, asset retirement obligations, assumed debt, other liabilities and noncontrolling interests. Identified intangible assets and liabilities primarily consist of the fair value of in-place leases and contractual rights. Goodwill is recognized as of the acquisition date and measured as the aggregate fair value of the consideration transferred and any noncontrolling interest in the acquiree over the fair value of identifiable net assets acquired. Likewise, a bargain purchase gain is recognized in current earnings when the aggregate fair value of the consideration transferred and any noncontrolling interest in the acquiree are less than the fair value of the identifiable net assets acquired. | |
The fair value of any tangible real estate assets acquired is determined by valuing the property as if it were vacant, and the “as-if-vacant” value is then allocated to land, buildings and improvements. Land values are derived from appraisals, and building values are calculated as replacement cost less depreciation or estimates of the relative fair value of these assets using net operating income capitalization rates, discounted cash flow analyses or similar methods. When we acquire rights to use land or improvements through contractual rights rather than fee simple interests, we determine the value of the use of these assets based on the relative fair value of the assets after considering the contractual rights and the fair value of similar assets. Assets acquired under these contractual rights are classified as intangibles and amortized on a straight-line basis over the shorter of the contractual term or the estimated useful life of the asset. Contractual rights related to land or air rights that are substantively separated from depreciating assets are amortized over the life of the contractual term or, if no term is provided, are classified as indefinite-lived intangibles. Intangible assets are evaluated at each reporting period to determine whether the indefinite and finite useful lives are appropriate. | |
We determine the value of in-place lease values and tenant relationships based on our evaluation of the specific characteristics of each tenant’s lease and our overall relationship with that respective tenant by applying a fair value model. The estimates of fair value of in-place leases include an estimate of carrying costs during the expected lease up periods for the respective leasable area considering current market conditions. In estimating fair value of in-place leases, we consider items such as real estate taxes, insurance, leasing commissions, tenant improvements and other operating expenses to execute similar deals as well as projected rental revenue and carrying costs during the expected lease up period. The estimate of the fair value of tenant relationships also includes our estimate of the likelihood of renewal. We amortize the value of in-place leases acquired to expense over the remaining term of the leases. The value of tenant relationship intangibles will be amortized to expense over the initial term and any anticipated renewal periods, but in no event will the amortization period for intangible assets exceed the remaining depreciable life of the building. The in-place leases are amortized over the remaining term of the in-place leases, approximately a six month term for multifamily in-place leases and terms ranging from three to 20 years for retail in-place leases. | |
We determine the value of above-market and below-market in-place leases for acquired properties based on the present value (using an interest rate that reflects the risks associated with the leases acquired) of the difference between (1) the contractual amounts to be paid pursuant to the in-place leases and (2) estimates of current market lease rates for the corresponding in-place leases, measured over a period equal to (i) the remaining non-cancelable lease term for above-market leases, or (ii) the remaining non-cancelable lease term plus any fixed rate renewal options for below-market leases. We record the fair value of above-market and below-market leases as intangible assets or intangible liabilities, respectively, and amortize them as an adjustment to rental income over the above determined lease term. Given the short-term nature of multifamily leases, the value of above-market or below-market in-place leases are generally not material. | |
We determine the value of other contractual rights based on our evaluation of the specific characteristics of the underlying contracts and by applying a fair value model to the projected cash flows or usage rights that considers the timing and risks associated with the cash flows or usage. We amortize the value of finite contractual rights over the remaining contract period. Indefinite-lived contractual rights are not amortized but are evaluated for impairment. | |
We determine the fair value of assumed debt by calculating the net present value of the scheduled debt service payments using interest rates for debt with similar terms and remaining maturities that management believes we could obtain. Any difference between the fair value and stated value of the assumed debt is recorded as a discount or premium and amortized over the remaining life of the loan. | |
Initial valuations are subject to change until our information is finalized, which is no later than 12 months from the acquisition date. We have had no significant valuation changes for acquisitions prior to March 31, 2015. | |
Developments | |
We capitalize project costs related to the development and construction of real estate (including interest, real estate taxes, insurance, and other direct costs associated with the development) as a cost of the development. Indirect project costs not clearly related to development and construction are expensed as incurred. Indirect project costs that clearly relate to development and construction are capitalized and allocated to the developments to which they relate. For each development, capitalization begins when we determine that the development is probable and significant development activities are underway. We suspend capitalization at such time as significant development activity ceases, but future development is still probable. We cease capitalization when the developments or other improvements, including any portion, are completed and ready for their intended use, or if the intended use changes such that capitalization is no longer appropriate. Developments or improvements are generally considered ready for intended use when the certificates of occupancy have been issued and the units become ready for occupancy. | |
Depreciation | |
Buildings are depreciated over their estimated useful lives ranging from 25 to 35 years using the straight-line method. Improvements are depreciated over their estimated useful lives ranging from 3 to 15 years using the straight-line method. Properties classified as held for sale are not depreciated. Depreciation of developments begins when the development is substantially completed and ready for its intended use. | |
Repairs and Maintenance | |
Expenditures for ordinary repairs and maintenance costs are charged to expense as incurred. | |
Investment in Unconsolidated Real Estate Joint Venture | Investment in Unconsolidated Real Estate Joint Venture |
We and our Co-Investment Ventures account for investments in unconsolidated real estate joint ventures using the equity method of accounting when we exercise significant influence over, but do not control, these entities. These investments are initially recorded at cost, including any acquisition costs, and are adjusted for our share of equity in earnings and distributions. We report our share of income and losses based on our economic interests in the entities. | |
We capitalize interest expense to investments in unconsolidated real estate joint ventures for our share of qualified expenditures during their development phase. We did not capitalize any interest expense related to investments in unconsolidated real estate joint ventures for the three months ended March 31, 2015 or 2014. | |
We amortize any excess of the carrying value of our investments in joint ventures over the book value of the underlying equity over the estimated useful lives of the underlying operating property, which represents the assets to which the excess is most clearly related. | |
When we or our Co-Investment Ventures acquire a controlling interest in a previously noncontrolled investment, a gain or loss on revaluation of equity is recognized for the differences between the investment’s carrying value and fair value. | |
Impairment of Real Estate Related Assets and Investments in Unconsolidated Real Estate Joint Ventures | Impairment of Real Estate Related Assets and Investments in Unconsolidated Real Estate Joint Ventures |
If events or circumstances indicate that the carrying amount of the property may not be recoverable, we make an assessment of the property’s recoverability by comparing the carrying amount of the asset to our estimate of the undiscounted future operating cash flows expected to be generated over the holding period of the asset including its eventual disposition. If the carrying amount exceeds the aggregate undiscounted future operating cash flows, we recognize an impairment loss to the extent the carrying amount exceeds the estimated fair value of the property. In addition, we evaluate indefinite-lived intangible assets for possible impairment at least annually by comparing the fair values with the carrying values. The fair value of intangibles is generally estimated by valuation of similar assets. | |
For real estate we own through an investment in an unconsolidated real estate joint venture or other similar real estate investment structure, at each reporting date we compare the estimated fair value of our real estate investment to the carrying value. An impairment charge is recorded to the extent the fair value of our real estate investment is less than the carrying amount and the decline in value is determined to be other than a temporary decline. | |
Assets Held for Sale and Discontinued Operations | Assets Held for Sale and Discontinued Operations |
Prior to January 1, 2014, when we had no involvement after the sale of a multifamily community, the multifamily community sold was reported as a discontinued operation. Effective as of January 1, 2014, we elected to early adopt the revised guidance regarding discontinued operations as further discussed in Note 3, “New Accounting Pronouncements.” For sales of real estate or assets classified as held for sale after January 1, 2014, we evaluate whether the disposition will have a major effect on our operations and financial results and will therefore qualify as a strategic shift. If the disposition represents a strategic shift, it will be classified as discontinued operations in our consolidated statements of operations for all periods presented. If the disposition does not represent a strategic shift, it will be presented in continuing operations in our consolidated statements of operations. | |
We classify multifamily communities as held for sale when certain criteria are met, in accordance with GAAP. At that time, we present the assets and obligations associated with the real estate held for sale separately in our consolidated balance sheet, and we cease recording depreciation and amortization expense related to that multifamily community. Real estate held for sale is reported at the lower of its carrying amount or its estimated fair value less estimated costs to sell. | |
Cash and Cash Equivalents | Cash and Cash Equivalents |
We consider investments in bank deposits, money market funds and highly-liquid cash investments with original maturities of three months or less to be cash equivalents. | |
As of March 31, 2015 and December 31, 2014, cash and cash equivalents include $25.4 million and $42.0 million, respectively, held by the Master Partnership and individual Co-Investment Ventures that are available only for use in the business of the Master Partnership and the other individual Co-Investment Ventures. Cash held by individual Co-Investment Ventures is not restricted to specific uses within those entities. However, the terms of the joint venture agreements limit the ability to distribute those funds to us or use them for our general corporate purposes. Cash held by individual Co-Investment Ventures is distributed from time to time to the Company and to the other Co-Investment Venture partners in accordance with the applicable Co-Investment Venture governing agreement, which may not be the same as the stated effective ownership interest. Cash distributions received by the Company from the individual Co-Investment Ventures are then available for our general corporate purposes. | |
Noncontrolling Interests | Noncontrolling Interests |
Redeemable noncontrolling interests are comprised of our consolidated Co-Investment Venture partners’ interests in multifamily communities where we believe it is probable that we will be required to purchase the partner’s noncontrolling interest. We record obligations under the redeemable noncontrolling interest initially at the higher of (a) fair value or (b) the redemption value with subsequent adjustments. The redeemable noncontrolling interests are temporary equity not within our control and are presented in our consolidated balance sheet outside of permanent equity between debt and equity. The determination of the redeemable classification requires analysis of contractual provisions and judgments of redemption probabilities. | |
Non-redeemable noncontrolling interests are comprised of our consolidated Co-Investment Venture partners’ interests in multifamily communities as well as preferred cumulative, non-voting membership units (“Preferred Units”) issued by subsidiary REITs. We record these noncontrolling interests at their initial fair value, adjusting the basis prospectively for their share of the respective consolidated investments’ net income or loss or equity contributions and distributions. These noncontrolling interests are not redeemable by the equity holders and are presented as part of permanent equity. | |
Income and losses are allocated to the noncontrolling interest holder based on its economic interests. | |
Transactions involving a partial sale or acquisition of a noncontrolling interest that does not result in a change of control are recorded at carrying value with no recognition of gain or loss. Any differences between the cash received or paid (net of any direct expenses) and the change in noncontrolling interest is recorded as a direct charge to additional paid-in capital. Transactions involving a partial sale or acquisition of a controlling interest resulting in a change in control are recorded at fair value with recognition of a gain or loss. | |
Other Assets | Other Assets |
Other assets primarily include deferred financing costs, notes receivable, equity method investments, accounts receivable, restricted cash, prepaid assets and deposits. Deferred financing costs are recorded at cost and are amortized using a straight-line method that approximates the effective interest method over the life of the related debt. We evaluate whether notes receivable are loans, investments in joint ventures or acquisitions of real estate based on a review of any rights to participate in expected residual profits and other equity and loan characteristics. As of and for the three months ended March 31, 2015 and 2014, all of our notes receivable were appropriately accounted for as loans. We account for our derivative financial instruments, all of which are interest rate caps, at fair value. We use interest rate cap arrangements to manage our exposure to interest rate changes. We have not designated any of these derivatives as hedges for accounting purposes, and accordingly, changes in fair value are recognized in earnings. | |
Revenue Recognition | Revenue Recognition |
Rental income related to leases is recognized on an accrual basis when due from residents or commercial tenants, generally on a monthly basis. Rental revenues for leases with uneven payments and terms greater than one year are recognized on a straight-line basis over the term of the lease. Any deferred revenue is classified as a liability on the consolidated balance sheet and recognized on a straight-line basis as income over its contractual term. | |
Interest income is generated primarily on notes receivable and cash balances. Interest income is recorded on an accrual basis as earned. | |
Transition Expenses | Transition Expenses |
Transition expenses include expenses directly and specifically related to our transition to self-management, primarily including legal, financial advisors, consultants, costs of the Company’s special committee of the board of directors, comprised of all of the Company’s independent directors (the “Special Committee”), general transition services (primarily related to staffing, name change, notices, transition-related insurance, information technology and facilities), expenses related to our listing on the NYSE and payments to our former external advisor in connection with the transition to self-management discussed further in Note 12, “Transition Expenses.” | |
Income Taxes | Income Taxes |
We have elected to be taxed as a REIT under the Code and have qualified as a REIT since the year ended December 31, 2007. To qualify as a REIT, we must meet a number of organizational and operational requirements, including a requirement that we distribute at least 90% of our REIT taxable income to our stockholders. As a REIT, we generally will not be subject to federal income tax at the corporate level. We intend to operate in such a manner as to continue to qualify for taxation as a REIT, but no assurance can be given that we will operate in a manner so as to remain qualified as a REIT. Taxable income from certain non-REIT activities is managed through a taxable REIT subsidiary (“TRS”) and is subject to applicable federal, state, and local income and margin taxes. We have no significant taxes associated with our TRS for the three months ended March 31, 2015 or 2014. | |
We have evaluated the current and deferred income tax related to state taxes, with respect to which we do not have a REIT exemption, and we have no significant tax liability or benefit as of March 31, 2015 or December 31, 2014. | |
The carrying amounts of our assets and liabilities for financial statement purposes differ from our basis for federal income taxes due to tax accounting in Co-Investment Ventures, fair value accounting for business combinations, straight lining of lease and related agreements and differing depreciation methods. The primary asset and liability balance sheet accounts with differences are real estate, intangibles, other assets, mortgages and notes payable and deferred revenues, primarily lease revenues, net. | |
We recognize the financial statement benefit of an uncertain tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. | |
Concentration of Credit Risk | Concentration of Credit Risk |
We invest our cash and cash equivalents among several banking institutions and money market accounts in an attempt to minimize exposure to any one of these entities. As of March 31, 2015 and December 31, 2014, we had cash and cash equivalents deposited in certain financial institutions in excess of federally-insured levels. We regularly monitor the financial condition of these financial institutions and believe that we are not exposed to any significant credit risk in cash and cash equivalents. | |
Share-based Compensation | Share-based Compensation |
We have a stock-based incentive award plan for our employees and directors, which includes restricted stock units and restricted stock awards. Compensation expense associated with the stock-based plan is recognized in general and administrative expenses in our consolidated statements of operations. We measure stock-based compensation at the estimated fair value on the grant date, net of estimated forfeitures, and recognize the amortization of compensation expense over the requisite service period. | |
Earnings per Share | Earnings per Share |
Basic earnings per share is calculated by dividing net income attributable to common stockholders by the weighted average number of common shares outstanding during the period excluding any unvested restricted stock awards. Diluted earnings per share is calculated by adjusting basic earnings per share for the dilutive effect of the assumed exercise of securities, including the effect of shares issuable under our preferred stock and our stock-based incentive plans. Our unvested share-based awards are considered participating securities and are reflected in the calculation of diluted earnings per share. During periods of net loss, the assumed exercise of securities is anti-dilutive and is not included in the calculation of earnings per share. During 2014, the dilutive impact was less than $0.01 and during 2015 any common stock equivalents were anti-dilutive. | |
For all periods presented, the preferred stock was excluded from the calculation of earnings per share because the effect would not be dilutive. However, based on changing market conditions, the outstanding preferred stock could be dilutive in future periods. | |
Redemptions of Common Stock | Redemptions of Common Stock |
We account for the possible redemption of our shares by classifying securities that are convertible for cash at the option of the holder outside of equity. We do not reclassify the shares to be redeemed from equity to a liability until such time as the redemption has been formally approved by our board of directors. The portion of the redeemed common stock in excess of the par value is charged to additional paid-in capital. | |
Reportable Segments | Reportable Segments |
Our current business primarily consists of investing in and operating multifamily communities. Substantially all of our consolidated net income (loss) is from investments in real estate properties that we wholly own or own through Co-Investment Ventures, the latter of which may be accounted for under the equity method of accounting. Our management evaluates operating performance on an individual investment level. However, as each of our investments has similar economic characteristics in our consolidated financial statements, the Company is managed on an enterprise-wide basis with one reportable segment. | |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements |
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts included in the financial statements and accompanying notes to consolidated financial statements. These estimates include such items as: the purchase price allocations for real estate and other acquisitions; impairment of long-lived assets, notes receivable and equity-method real estate investments; fair value evaluations; earning recognition of noncontrolling interests and equity in earnings of investments in unconsolidated real estate joint ventures; depreciation and amortization; share-based compensation measurements; and recognition and timing of transition expenses. Actual results could differ from those estimates. |
Organization_and_Business_Tabl
Organization and Business (Tables) | 3 Months Ended | |||||
Mar. 31, 2015 | ||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||
Summary of the number of each type of Co-Investment Venture and the entity's effective ownership ranges | The table below presents a summary of our Co-Investment Ventures as of both March 31, 2015 and December 31, 2014. The effective ownership ranges are based on our participation in the distributable operating cash from the multifamily investment. This effective ownership is indicative of, but may differ over time from, percentages for distributions, contributions or financing requirements for each respective Co-Investment Venture. Unless otherwise noted, all are reported on the consolidated basis of accounting. | |||||
Co-Investment Structure | Number of Multifamily Communities | Our Effective | ||||
Ownership | ||||||
PGGM CO-JVs (a) | 30 | 50% to 74% | ||||
MW CO-JVs | 14 | 55% | ||||
Developer CO-JVs | 2 | 100% | ||||
Total | 46 | |||||
(a) | Includes one unconsolidated investment as of March 31, 2015 and December 31, 2014. Also, as of March 31, 2015 and December 31, 2014, includes Developer Partners in 19 multifamily communities. |
Real_Estate_Investments_Tables
Real Estate Investments (Tables) | 3 Months Ended | ||||||||||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||||||||||
Real Estate [Abstract] | |||||||||||||||||||||||||
Schedule of major components of real estate investments and intangibles and related accumulated depreciation and amortization | As of March 31, 2015 and December 31, 2014, major components of our real estate investments and intangibles and related accumulated depreciation and amortization were as follows (in millions): | ||||||||||||||||||||||||
March 31, 2015 | December 31, 2014 | ||||||||||||||||||||||||
Buildings | Intangibles | Buildings | Intangibles | ||||||||||||||||||||||
and | In-Place | Other | and | In-Place | Other | ||||||||||||||||||||
Improvements | Leases | Contractual | Improvements | Leases | Contractual | ||||||||||||||||||||
Cost | $ | 1,972.50 | $ | 40.7 | $ | 25.6 | $ | 2,033.80 | $ | 40.7 | $ | 25.6 | |||||||||||||
Less: accumulated depreciation and amortization | (291.4 | ) | (38.4 | ) | (7.5 | ) | (280.4 | ) | (38.3 | ) | (6.5 | ) | |||||||||||||
Net | $ | 1,681.10 | $ | 2.3 | $ | 18.1 | $ | 1,753.40 | $ | 2.4 | $ | 19.1 | |||||||||||||
Schedule of anticipated amortization associated with in-place lease and other contractual intangibles | Anticipated amortization associated with lease and other contractual intangibles for each of the following five years is as follows (in millions): | ||||||||||||||||||||||||
Anticipated Amortization | |||||||||||||||||||||||||
Year | of Intangibles | ||||||||||||||||||||||||
April through December 2015 | $ | 1.8 | |||||||||||||||||||||||
2016 | 1.4 | ||||||||||||||||||||||||
2017 | 1.4 | ||||||||||||||||||||||||
2018 | 0.5 | ||||||||||||||||||||||||
2019 | 0.5 | ||||||||||||||||||||||||
Schedule of real estate developments | For the three months ended March 31, 2015 and 2014, we capitalized the following amounts of interest, real estate taxes and overhead related to our developments (in millions): | ||||||||||||||||||||||||
For the Three Months Ended | |||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||||||
Interest | $ | 4.8 | $ | 4.1 | |||||||||||||||||||||
Real estate taxes | 1.5 | 1.5 | |||||||||||||||||||||||
Overhead | 0.2 | 0.2 | |||||||||||||||||||||||
Schedule of real estate dispositions | The following table presents our sale of real estate for the three months ended March 31, 2014 (in millions). There were no sales of real estate for the three months ended March 31, 2015. | ||||||||||||||||||||||||
Date of Sale | Multifamily Community | Sales Contract Price | Net Cash Proceeds | Gain on Sale of Real Estate | |||||||||||||||||||||
Feb-14 | Tupelo Alley | $ | 52.9 | $ | 33.1 | $ | 16.2 | ||||||||||||||||||
Net income related to sale of multifamily community | The following table presents net income related to the Tupelo Alley multifamily community for the three months ended March 31, 2014 and includes the gain on sale of real estate (in millions): | ||||||||||||||||||||||||
For the Three Months Ended | |||||||||||||||||||||||||
March 31, 2014 | |||||||||||||||||||||||||
Net income (loss) from multifamily community sold in 2014 | $ | 15.8 | |||||||||||||||||||||||
Less: net income attributable to noncontrolling interest | (7.2 | ) | |||||||||||||||||||||||
Net income (loss) attributable to common stockholders | $ | 8.6 | |||||||||||||||||||||||
Major classes of assets and obligations associated with real estate held for sale | The major classes of assets and obligations associated with real estate held for sale are as follows (in millions): | ||||||||||||||||||||||||
March 31, 2015 | |||||||||||||||||||||||||
Land | $ | 10.4 | |||||||||||||||||||||||
Buildings and improvements, net of approximately $12.4 million in accumulated depreciation | 65.7 | ||||||||||||||||||||||||
Other assets, net | 0.5 | ||||||||||||||||||||||||
Assets associated with real estate held for sale | $ | 76.6 | |||||||||||||||||||||||
Accounts payable and other liabilities | $ | 0.7 | |||||||||||||||||||||||
Obligations associated with real estate held for sale | $ | 0.7 | |||||||||||||||||||||||
Other_Assets_Tables
Other Assets (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Other Assets [Abstract] | |||||||||
Schedule of components of other assets | The components of other assets are as follows (in millions): | ||||||||
March 31, 2015 | December 31, 2014 | ||||||||
Notes receivable, net (a) | $ | 59.8 | $ | 59.8 | |||||
Escrows and restricted cash | 7.9 | 8 | |||||||
Deferred financing costs, net | 18.8 | 17.4 | |||||||
Resident, tenant and other receivables | 16.2 | 14 | |||||||
Prepaid assets, deposits and other assets | 6.7 | 6.1 | |||||||
Investment in unconsolidated real estate joint venture | 5.1 | 5 | |||||||
Total other assets | $ | 114.5 | $ | 110.3 | |||||
(a) | Notes receivable include mezzanine loans, primarily related to multifamily development projects. As of March 31, 2015, the weighted average interest rate is 14.7% and the remaining years to scheduled maturity is 0.8 years. Notes receivable are all generally pre-payable at the option of the borrowers. |
Leasing_Activity_Tables
Leasing Activity (Tables) | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Leases [Abstract] | |||||
Schedule of future minimum base rental payments due to the entity under non-cancelable retail leases | Future minimum base rental receipts due to us under these non-cancelable retail leases with initial terms greater than one year in effect as of March 31, 2015 are as follows (in millions): | ||||
Future Minimum | |||||
Year | Lease Receipts | ||||
April through December 2015 | $ | 2.9 | |||
2016 | 3.8 | ||||
2017 | 3.8 | ||||
2018 | 3.6 | ||||
2019 | 3.6 | ||||
Thereafter | 26.4 | ||||
Total | $ | 44.1 | |||
Mortgages_and_Notes_Payable_Ta
Mortgages and Notes Payable (Tables) | 3 Months Ended | ||||||||||||
Mar. 31, 2015 | |||||||||||||
Debt Disclosure [Abstract] | |||||||||||||
Schedule of carrying amounts of the mortgages and notes payable classified by whether the obligation is of the parent company or the applicable consolidated Co-Investment Venture | The following table summarizes the carrying amounts of the mortgages and notes payable classified by whether the obligation is ours or that of the applicable consolidated Co-Investment Venture as of March 31, 2015 and December 31, 2014 (dollar amounts in millions and monthly LIBOR at March 31, 2015 is 0.18%): | ||||||||||||
As of March 31, 2015 | |||||||||||||
March 31, | December 31, | Wtd. Average | |||||||||||
2015 | 2014 | Interest Rates | Maturity Dates | ||||||||||
Company level (a) | |||||||||||||
Fixed rate mortgages payable | $ | 87.2 | $ | 87.2 | 3.95% | 2018 to 2020 | |||||||
Variable rate construction loans payable (b) | 50 | 33 | Monthly LIBOR + 2.12% | 2017 to 2018 | |||||||||
Total Company level | 137.2 | 120.2 | |||||||||||
Co-Investment Venture level - consolidated (c) | |||||||||||||
Fixed rate mortgages payable | 773.3 | 827.7 | 3.70% | 2015 to 2020 | |||||||||
Variable rate mortgage payable | 11.9 | 12 | Monthly LIBOR + 2.35% | 2017 | |||||||||
Fixed rate construction loans payable (d) | 63.1 | 57 | 4.14% | 2016 to 2018 | |||||||||
Variable rate construction loans payable (e) | 242.9 | 165.3 | Monthly LIBOR + 2.10% | 2016 to 2018 | |||||||||
1,091.20 | 1,062.00 | ||||||||||||
Plus: unamortized adjustments from business combinations | 3.8 | 4.3 | |||||||||||
Total Co-Investment Venture level - consolidated | 1,095.00 | 1,066.30 | |||||||||||
Total consolidated mortgages and notes payable | $ | 1,232.20 | $ | 1,186.50 | |||||||||
(a) | Company level debt is defined as debt that is a direct or indirect obligation of the Company or its wholly owned subsidiaries. Company level debt includes the applicable portion of Co-Investment debt where the Company has provided full or partial guarantees for the repayment of the debt. | ||||||||||||
(b) | Includes the amount of the Co-Investment Venture level construction loans payable that is guaranteed by the Company. As of March 31, 2015, the Company has partially guaranteed ten loans with total commitments of $534.7 million. These loans include one to two year extension options. Our percentage guarantee on each of these loans ranges from 10% to 25% and the amount of our current guarantee and the maximum guarantee based on the commitment as of March 31, 2015 is $50.0 million and $103.9 million, respectively. The non-recourse portion of the loans outstanding as of March 31, 2015 is reported in the Co-Investment Venture level construction loans payable. | ||||||||||||
(c) | Co-Investment Venture level debt is defined as debt that is an obligation of the Co-Investment Venture and | ||||||||||||
not an obligation or contingency for us. | |||||||||||||
(d) | Includes two loans with total commitments of $84.8 million. One of the construction loans has an option to convert into a permanent loan with a maturity of 2023. | ||||||||||||
(e) | Includes eleven loans with total commitments of $556.6 million. These loans include one to two year extension options. The amount guaranteed by the Company is reported as Company level debt as discussed in footnote (b) above. | ||||||||||||
Schedule of contractual principal payments for the entity's mortgages and notes payable for the five subsequent years and thereafter | As of March 31, 2015, contractual principal payments for our mortgages and notes payable for the five subsequent years and thereafter are as follows (in millions): | ||||||||||||
Co-Investment | Total | ||||||||||||
Year | Company Level | Venture Level | Consolidated | ||||||||||
April through December 2015 | $ | 0.2 | $ | 29.1 | $ | 29.3 | |||||||
2016 | 0.6 | 185.5 | 186.1 | ||||||||||
2017 | 14.6 | 266.8 | 281.4 | ||||||||||
2018 | 66.8 | 316.4 | 383.2 | ||||||||||
2019 | 1.1 | 219.4 | 220.5 | ||||||||||
Thereafter | 53.9 | 74 | 127.9 | ||||||||||
Total | $ | 137.2 | $ | 1,091.20 | 1,228.40 | ||||||||
Add: unamortized adjustments from business combinations | 3.8 | ||||||||||||
Total mortgages and notes payable | $ | 1,232.20 | |||||||||||
Credit_Facilities_Payable_Tabl
Credit Facilities Payable (Tables) | 3 Months Ended | |||||||||||||
Mar. 31, 2015 | ||||||||||||||
Line of Credit Facility [Abstract] | ||||||||||||||
Schedule of Line of Credit Facilities | The following table presents the amounts outstanding under the two credit facilities as of March 31, 2015 and December 31, 2014 (dollar amounts in millions, and monthly LIBOR at March 31, 2015 is 0.18%): | |||||||||||||
Balance Outstanding | ||||||||||||||
31-Mar-15 | 31-Dec-14 | Interest Rate as of March 31, 2015 | Maturity Date | |||||||||||
$150 Million Facility | $ | 35 | $ | 10 | Monthly LIBOR + 2.08% | April 1, 2017 | ||||||||
$200 Million Facility | — | — | Monthly LIBOR + 2.50% | January 14, 2019 | ||||||||||
Total | $ | 35 | $ | 10 | ||||||||||
Noncontrolling_Interests_Table
Noncontrolling Interests (Tables) | 3 Months Ended | ||||||||||||
Mar. 31, 2015 | |||||||||||||
Noncontrolling Interest [Abstract] | |||||||||||||
Schedule of non-redeemable, noncontrolling interests | As of March 31, 2015 and December 31, 2014, non-redeemable noncontrolling interests (“NCI”) consisted of the following, including the direct and non-direct noncontrolling interests ownership ranges where applicable (dollar amounts in millions): | ||||||||||||
March 31, 2015 | December 31, 2014 | ||||||||||||
Effective | Effective | ||||||||||||
Amount | NCI % (a) | Amount | NCI % (a) | ||||||||||
PGGM Co-Investment Partner | $ | 377.8 | 26% to 45% | $ | 390.5 | 26% to 45% | |||||||
MW Co-Investment Partner | 142.6 | 45% | 144.9 | 45% | |||||||||
Developer Partners | 3.5 | 0% | 3.4 | 0% | |||||||||
Subsidiary preferred units | 2.1 | (b) | 1.9 | (b) | |||||||||
Total non-redeemable NCI | $ | 526 | $ | 540.7 | |||||||||
(a) Effective noncontrolling percentage is based upon the noncontrolling interest’s participation in distributable operating cash. This effective ownership is indicative of, but may differ over time from, percentages for distributions, contributions or financing requirements. | |||||||||||||
(b) | The effective NCI for the preferred units is not meaningful and the preferred units have no voting rights. | ||||||||||||
Schedule of distributions to noncontrolling interests | For the three months ended March 31, 2015 and 2014, we paid the following distributions to noncontrolling interests (in millions): | ||||||||||||
For the Three Months Ended | |||||||||||||
March 31, | |||||||||||||
2015 | 2014 | ||||||||||||
Distributions paid to noncontrolling interests: | |||||||||||||
Operating activities | $ | 6 | $ | 5.7 | |||||||||
Investing and financing activities | 17 | 14.9 | |||||||||||
Total | $ | 23 | $ | 20.6 | |||||||||
Schedule of redeemable, noncontrolling interests (NCI) | As of March 31, 2015 and December 31, 2014, redeemable noncontrolling interests (“NCI”) consisted of the following (dollar amounts in millions): | ||||||||||||
March 31, 2015 | December 31, 2014 | ||||||||||||
Effective | Effective | ||||||||||||
Amount | NCI % (a) | Amount | NCI % (a) | ||||||||||
Developer Partners | $ | 32 | 0% to 10% | $ | 32 | 0% to 10% | |||||||
(a) Effective noncontrolling interest percentage is based upon the noncontrolling interest’s participation in distributable operating cash. This effective ownership is indicative of, but may differ from, percentages for distributions, contributions or financing requirements. For Co-Investment Ventures where the developer’s equity has been returned, the effective noncontrolling interest percentage is shown as zero. |
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 3 Months Ended | ||||||
Mar. 31, 2015 | |||||||
Equity [Abstract] | |||||||
Schedule of Nonvested Restricted Stock Units Activity | The following is a summary of the number of restricted stock units issued, exercised and outstanding as of March 31, 2015 and 2014: | ||||||
March 31, 2015 | March 31, 2014 | ||||||
Outstanding at the beginning of the period | 254,691 | 6,000 | |||||
Issued (a) | 424,799 | 239,220 | |||||
Exercised | (40,690 | ) | — | ||||
Outstanding at the end of the period | 638,800 | 245,220 | |||||
(a) | Units issued in 2015 had a grant price of $9.42 per unit. Units issued in 2014 had a grant price of $10.03 per unit. As of March 31, 2015, 82,897 units are vested. | ||||||
Nonvested Restricted Stock Shares Activity | The following is a summary of the restricted stock issued, forfeited and outstanding as of March 31, 2015 and 2014: | ||||||
March 31, 2015 | March 31, 2014 | ||||||
Outstanding at the beginning of the year | — | — | |||||
Issued (a) | 25,777 | — | |||||
Forfeited | (3,256 | ) | — | ||||
Outstanding at the end of the period | 22,521 | — | |||||
(a) | Shares issued in 2015 had a grant price of $9.21 per share. |
Transition_Expenses_Tables
Transition Expenses (Tables) | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Transition to Self-Management [Abstract] | |||||
Schedule of Transition Expenses | The table below represents the components of our transition expenses for the three months ended March 31, 2014 (in millions). We did not incur any transition expenses for the three months ended March 31, 2015. | ||||
For the Three Months Ended | |||||
March 31, 2014 | |||||
Special Committee and Company legal and financial advisors | $ | 0.2 | |||
General transition services: | |||||
Behringer | 0.2 | ||||
Other service providers | 0.1 | ||||
Total transition expenses | $ | 0.5 | |||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Commitments and Contingencies Disclosure [Abstract] | |||||
Future minimum lease payments | Future minimum lease payments due on our lease commitment payables, primarily related to our corporate office lease which expires in 2024, are as follows (in millions): | ||||
Future Minimum Lease Payments | |||||
April 2015 through December 2015 | $ | 0.5 | |||
2016 | 0.6 | ||||
2017 | 0.8 | ||||
2018 | 0.8 | ||||
2019 | 0.8 | ||||
Thereafter | 4 | ||||
Total | $ | 7.5 | |||
Fair_Value_of_Derivatives_and_1
Fair Value of Derivatives and Financial Instruments (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
Schedule of carrying amounts and related estimated fair value of mortgage and notes payable | Carrying amounts and the related estimated fair value of our mortgages and notes payable as of March 31, 2015 and December 31, 2014 are as follows (in millions): | ||||||||||||||||
March 31, 2015 | December 31, 2014 | ||||||||||||||||
Carrying | Fair | Carrying | Fair | ||||||||||||||
Amount | Value | Amount | Value | ||||||||||||||
Mortgages and notes payable | $ | 1,232.20 | $ | 1,246.40 | $ | 1,186.50 | $ | 1,199.60 | |||||||||
Related_Party_Arrangements_Tab
Related Party Arrangements (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Related Party Transactions [Abstract] | |||||||||
Schedule of Related Party Transactions | The table below shows the fees and expense reimbursements to Behringer in exchange for such services for the three months ended March 31, 2015 and 2014 (in millions): | ||||||||
For the Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Acquisition and advisory fees | $ | — | $ | 1.8 | |||||
Property management fees | — | 5.5 | |||||||
Debt financing fees | 0.2 | 0.2 | |||||||
Asset management fees | — | 1.9 | |||||||
Administrative expense reimbursements | — | 0.4 | |||||||
Supplemental_Disclosures_of_Ca1
Supplemental Disclosures of Cash Flow Information (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Supplemental Cash Flow Information [Abstract] | |||||||||
Summary of supplemental cash flow information | Supplemental cash flow information is summarized below (in millions): | ||||||||
For the Three Months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Supplemental disclosure of cash flow information: | |||||||||
Interest paid, net of amounts capitalized of $4.8 million and $4.1 million in 2015 and 2014, respectively | $ | 7.8 | $ | 6.8 | |||||
Non-cash investing and financing activities: | |||||||||
Transfer of real estate from construction in progress to operating real estate | 14.8 | 39.4 | |||||||
Transfer of assets to assets associated with real estate held for sale | 76.6 | — | |||||||
Stock issued pursuant to our DRIP | — | 7.6 | |||||||
Distributions payable - regular | 12.5 | 5 | |||||||
Construction costs and other related payables | 64 | 50.8 | |||||||
Subsequent_Events_Tables
Subsequent Events (Tables) | 3 Months Ended | ||||||||||||
Mar. 31, 2015 | |||||||||||||
Subsequent Events [Abstract] | |||||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net | The following table summarizes the acquisitions of each of the multifamily community interests in the PGGM CO-JVs: | ||||||||||||
Our Ownership Interest (a) | |||||||||||||
Community and Location | Total Units | Pre- Acquisition | Acquired Interest | Post- Acquisition | |||||||||
Equity investments: | |||||||||||||
The District Universal Boulevard, Orlando, FL | 425 | 55.5 | % | 44.5 | % | 100 | % | ||||||
Veritas, Henderson, NV (b) | 430 | 51.9 | % | 41.6 | % | 93.5 | % | ||||||
The Cameron, Silver Spring, MD | 325 | 55.5 | % | 44.5 | % | 100 | % | ||||||
Skye 2905, Denver, CO | 400 | 55.5 | % | 44.5 | % | 100 | % | ||||||
Grand Reserve, Dallas, TX | 149 | 74.4 | % | 25.6 | % | 100 | % | ||||||
Stone Gate, Marlborough, MA | 332 | 55.5 | % | 44.5 | % | 100 | % | ||||||
2,061 | |||||||||||||
Debt investment: | |||||||||||||
Jefferson Creekside, Allen, TX | 444 | 55.5 | % | 44.5 | % | 100 | % | ||||||
(a) | Our ownership interest is based on our share of contributed capital. This ownership interest may differ over time from percentages for distributions, contributions or financing requirements for each respective CO-JV. The post-acquisition effective ownership interests based on our participation in distributable cash from the CO-JVs are the same as those presented based on contributed capital, except for Veritas where our post-acquisition effective ownership based on our current participation in distributable cash is 100%. Each of the equity investments was previously accounted for on the consolidated method of accounting with the same accounting method post-acquisition. The debt investment was previously accounted for on the equity method of accounting and post-acquisition will be accounted for on the consolidated method of accounting. | ||||||||||||
(b) | The remaining 6.5% is owned by a Developer Partner. |
Organization_and_Business_Deta
Organization and Business (Details) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2015 | Dec. 31, 2013 | Jul. 31, 2013 | Dec. 31, 2014 | |
community | investment | officer | ||
property | ||||
investment | ||||
joint_venture | ||||
Organization and business | ||||
Number of executive officers transferred | 5 | |||
Number of multifamily communities in which the entity has made wholly owned investments or joint venture equity | 56 | |||
Number of stabilized operating properties | 38 | |||
Number of multifamily communities in development | 18 | |||
Number of wholly owned multifamily communities | 7 | |||
Number of debt investments made by the entity | 3 | |||
Number of wholly owned investments | 10 | |||
Number of multifamily communities in which the entity is having ownership interest through Co-Investment Ventures | 46 | |||
Number of consolidated investments | 45 | |||
Number of unconsolidated joint venture equity investment in multifamily community | 1 | 1 | ||
Co-Investment Ventures | ||||
Number of Co-Investment Ventures | 46 | |||
Minimum Percentage Of Ordinary Taxable Income Distribution Requirement | 90.00% | |||
Developer CO-JVs | ||||
Co-Investment Ventures | ||||
Number of Co-Investment Ventures | 2 | |||
Effective Ownership (as a percent) | 100.00% | |||
PGGM Co JVs | ||||
Co-Investment Ventures | ||||
Number of Co-Investment Ventures | 30 | |||
Number of Multifamily Communities | 19 | |||
PGGM Co JVs | Minimum | ||||
Co-Investment Ventures | ||||
Effective Ownership (as a percent) | 50.00% | |||
PGGM Co JVs | Maximum | ||||
Co-Investment Ventures | ||||
Effective Ownership (as a percent) | 74.00% | |||
MW CO-JVs | ||||
Co-Investment Ventures | ||||
Number of Co-Investment Ventures | 14 | |||
Effective Ownership (as a percent) | 55.00% | |||
PGGM Co JVs | ||||
Organization and business | ||||
Ownership percentage by parent | 1.00% | |||
PGGM Co JVs | Minimum | ||||
Organization and business | ||||
Effective NCI (as a percent) | 26.00% | 26.00% | ||
PGGM Co JVs | Maximum | ||||
Organization and business | ||||
Effective NCI (as a percent) | 45.00% | 45.00% | ||
PGGM | ||||
Organization and business | ||||
Effective NCI (as a percent) | 99.00% | |||
Advisor | ||||
Organization and business | ||||
Number of employees supported by related party service agreements | 0 |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Dec. 31, 2014 | |
segment | ||
Cash and Cash Equivalents | ||
Cash and cash equivalents held by individual Co-Investment Ventures | $25,400,000 | $42,000,000 |
Minimum lease term to recognize rental revenues | 1 year | |
Income Taxes | ||
Minimum Percentage Of Ordinary Taxable Income Distribution Requirement | 90.00% | |
Tax liability or benefit | 0 | 0 |
Uncertain tax positions | $0 | $0 |
Maximum dilutive impact per share | $0.01 | |
Number of reportable segments | 1 | |
Buildings | Minimum | ||
Real Estate and Other Related Intangibles | ||
Estimated useful lives | 25 years | |
Buildings | Maximum | ||
Real Estate and Other Related Intangibles | ||
Estimated useful lives | 35 years | |
Improvements | Minimum | ||
Real Estate and Other Related Intangibles | ||
Estimated useful lives | 3 years | |
Improvements | Maximum | ||
Real Estate and Other Related Intangibles | ||
Estimated useful lives | 15 years | |
Multifamily in-place leases | ||
Real Estate and Other Related Intangibles | ||
Finite-Lived Intangible Asset, Useful Life | 6 months | |
Retail in-place leases | Minimum | ||
Real Estate and Other Related Intangibles | ||
Finite-Lived Intangible Asset, Useful Life | 3 years | |
Retail in-place leases | Maximum | ||
Real Estate and Other Related Intangibles | ||
Finite-Lived Intangible Asset, Useful Life | 20 years |
Real_Estate_Investments_Detail
Real Estate Investments (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Real Estate Investments | |||
Buildings and improvements | $1,972,480,000 | $2,033,819,000 | |
Less accumulated depreciation | -291,366,000 | -280,400,000 | |
Depreciation expense | 23,473,000 | 21,371,000 | |
Intangibles | |||
Net | 20,440,000 | 21,485,000 | |
Amortization expense associated with lease intangibles | 1,046,000 | 1,051,000 | |
In-Place Leases | |||
Intangibles | |||
Cost | 40,700,000 | 40,700,000 | |
Less: accumulated depreciation and amortization | -38,400,000 | -38,300,000 | |
Net | 2,300,000 | 2,400,000 | |
Amortization expense associated with lease intangibles | 1,000,000 | 1,100,000 | |
Other Contractual | |||
Intangibles | |||
Cost | 25,600,000 | 25,600,000 | |
Less: accumulated depreciation and amortization | -7,500,000 | -6,500,000 | |
Net | 18,100,000 | 19,100,000 | |
Asset management, fee revenue services, and contracts | |||
Intangibles | |||
Net | 9,200,000 | 9,200,000 | |
Use rights of a parking garage and site improvements | |||
Intangibles | |||
Net | 6,800,000 | 6,800,000 | |
Land air rights | |||
Intangibles | |||
Net | 9,500,000 | 9,500,000 | |
Buildings and Improvements | |||
Real Estate Investments | |||
Buildings and improvements | 1,972,500,000 | 2,033,800,000 | |
Less accumulated depreciation | -291,400,000 | -280,400,000 | |
Net | 1,681,100,000 | 1,753,400,000 | |
Depreciation expense | $23,400,000 | $21,400,000 |
Real_Estate_Investments_Detail1
Real Estate Investments (Details 2) (USD $) | Mar. 31, 2015 |
In Millions, unless otherwise specified | |
Anticipated Amortization of Lease Intangibles | |
April through December 2015 | $1.80 |
2016 | 1.4 |
2017 | 1.4 |
2018 | 0.5 |
2019 | $0.50 |
Real_Estate_Investments_Detail2
Real Estate Investments (Details 3) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Real Estate [Abstract] | ||
Interest | $4.80 | $4.10 |
Real estate taxes | 1.5 | 1.5 |
Overhead | $0.20 | $0.20 |
Real_Estate_Investments_Detail3
Real Estate Investments (Details 4) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Sale of Real Estate [Line Items] | ||
Net cash proceeds | $0 | $33,134,000 |
Gain on sale of real estate | 0 | 16,167,000 |
Tupelo Alley | ||
Sale of Real Estate [Line Items] | ||
Sales contract price | 52,900,000 | |
Net cash proceeds | 33,100,000 | |
Gain on sale of real estate | $16,200,000 |
Real_Estate_Investments_Detail4
Real Estate Investments (Details 5) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2014 |
Real Estate [Abstract] | |
Net income (loss) from multifamily community sold in 2014 | $15.80 |
Less: net income attributable to noncontrolling interest | -7.2 |
Net income (loss) attributable to common stockholders | $8.60 |
Real_Estate_Investments_Detail5
Real Estate Investments (Details 6) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | Feb. 28, 2015 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Land | $10,400,000 | ||
Buildings and improvements, net of approximately $12.4 million in accumulated depreciation | 65,700,000 | ||
Accumulated depreciation | 12,400,000 | ||
Other assets, net | 500,000 | ||
Assets associated with real estate held for sale | 76,601,000 | 0 | |
Accounts payable and other liabilities | 700,000 | ||
Obligations associated with real estate held for sale | 741,000 | 0 | |
Burnham Pointe [Member] | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Total Units | 298 | ||
Purchase and sale agreement, consideration | $126,000,000 |
Variable_Interest_Entities_Det
Variable Interest Entities (Details) (USD $) | 3 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
entity | entity | |
Variable Interest Entities | ||
Number of variable interest entities | 15 | 15 |
Assets of VIE | $971.70 | $906.90 |
Construction in progress | 654.7 | 582.3 |
Multifamily community | ||
Variable Interest Entities | ||
Number of VIEs having debt | 12 | |
Construction financing closed by VIEs | 587.9 | |
Amount drawn under construction loan | 322 | |
Minimum | Co-Investment ventures | ||
Variable Interest Entities | ||
Ownership in VIEs (as a percent) | 55.00% | |
Maximum | Co-Investment ventures | ||
Variable Interest Entities | ||
Ownership in VIEs (as a percent) | 100.00% | |
Construction Loans | ||
Variable Interest Entities | ||
Guarantor Obligations, Number of Loans | 10 | |
Total commitments under guarantee | 534.7 | |
Amount outstanding | 272.2 | |
Number of non-recourse loans | 2 | |
Construction loan | Minimum | ||
Variable Interest Entities | ||
Percentage guaranteed on loans | 10.00% | |
Construction loan | Maximum | ||
Variable Interest Entities | ||
Percentage guaranteed on loans | 25.00% | |
Operating Real Estate Investment Property, Net [Member] | ||
Variable Interest Entities | ||
Assets of VIE | $294.30 | $282.10 |
Other_Assets_Details
Other Assets (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Dec. 31, 2014 | |
Other Assets [Abstract] | ||
Notes receivable, net | $59,800,000 | $59,800,000 |
Escrows and restricted cash | 7,900,000 | 8,000,000 |
Deferred financing costs, net | 18,800,000 | 17,400,000 |
Resident, tenant and other receivables | 16,200,000 | 14,000,000 |
Prepaid assets, deposits and other assets | 6,700,000 | 6,100,000 |
Investment in unconsolidated real estate joint venture | 5,100,000 | 5,000,000 |
Total other assets | $114,496,000 | $110,282,000 |
Weighted average interest rate on notes receivables (as a percent) | 14.70% | |
Remaining period to scheduled maturity on notes receivables | 10 months 6 days |
Leasing_Activity_Details
Leasing Activity (Details) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2015 |
Leases [Abstract] | |
Retail areas as a percentage of total rentable area of the entity's consolidated multifamily communities | 1.00% |
Future Minimum Lease Payments | |
April through December 2015 | $2.90 |
2016 | 3.8 |
2017 | 3.8 |
2018 | 3.6 |
2019 | 3.6 |
Thereafter | 26.4 |
Total | $44.10 |
Mortgages_and_Notes_Payable_De
Mortgages and Notes Payable (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Dec. 31, 2014 | |
loan | ||
Mortgage loans payable | ||
Total consolidated mortgages and notes Payable | $1,232,200,000 | $1,186,481,000 |
Guarantee of Indebtedness of Others | ||
Mortgage loans payable | ||
Current guarantee | 50,000,000 | |
Maximum guarantee | 103,900,000 | |
Mortgages and notes payable | ||
Mortgage loans payable | ||
Total | 1,228,400,000 | |
Plus: unamortized adjustments from business combinations | 3,800,000 | |
Total consolidated mortgages and notes Payable | 1,232,200,000 | 1,186,500,000 |
Net consolidated carrying value of real estate that collateralized the mortgage loans payable | 2,500,000,000 | |
Mortgages and notes payable | Parent | ||
Mortgage loans payable | ||
Total | 137,200,000 | |
Total consolidated mortgages and notes Payable | 137,200,000 | 120,200,000 |
Mortgages and notes payable | Consolidated co-investment venture | ||
Mortgage loans payable | ||
Total | 1,091,200,000 | 1,062,000,000 |
Plus: unamortized adjustments from business combinations | 3,800,000 | 4,300,000 |
Total consolidated mortgages and notes Payable | 1,095,000,000 | 1,066,300,000 |
Construction loan | Minimum | ||
Mortgage loans payable | ||
Percentage guaranteed on loans | 10.00% | |
Construction loan | Maximum | ||
Mortgage loans payable | ||
Percentage guaranteed on loans | 25.00% | |
Parent company, fixed rate mortgage payable | Mortgages and notes payable | Parent | ||
Mortgage loans payable | ||
Fixed rate mortgages payable | 87,200,000 | 87,200,000 |
Wtd. Average Interest Rates (as a percent) | 3.95% | |
Parent company, variable construction loan payable | Construction loan | Parent | ||
Mortgage loans payable | ||
Variable rate mortgages payable | 50,000,000 | 33,000,000 |
Interest rate base | Monthly LIBOR | |
Interest rate margin (as a percent) | 2.12% | |
Number of loans | 10 | |
Total loan commitment | 534,700,000 | |
Parent company, variable construction loan payable | Construction loan | Parent | Minimum | ||
Mortgage loans payable | ||
Extension option period | 1 year | |
Percentage guaranteed on loans | 10.00% | |
Parent company, variable construction loan payable | Construction loan | Parent | Maximum | ||
Mortgage loans payable | ||
Extension option period | 2 years | |
Percentage guaranteed on loans | 25.00% | |
Co-investment venture, fixed rate mortgages payable | Mortgages and notes payable | Consolidated co-investment venture | ||
Mortgage loans payable | ||
Fixed rate mortgages payable | 773,300,000 | 827,700,000 |
Wtd. Average Interest Rates (as a percent) | 3.70% | |
Co-investment venture, variable rate mortgage payable | Mortgages and notes payable | Consolidated co-investment venture | ||
Mortgage loans payable | ||
Variable rate mortgages payable | 11,900,000 | 12,000,000 |
Interest rate base | Monthly LIBOR | |
Interest rate margin (as a percent) | 2.35% | |
Co-investment venture, fixed rate construction loan payable | Construction loan | Consolidated co-investment venture | ||
Mortgage loans payable | ||
Fixed rate mortgages payable | 63,100,000 | 57,000,000 |
Wtd. Average Interest Rates (as a percent) | 4.14% | |
Number of loans | 2 | |
Total loan commitment | 84,800,000 | |
Co-investment venture, variable rate construction payable | Construction loan | Parent | Minimum | ||
Mortgage loans payable | ||
Extension option period | 1 year | |
Co-investment venture, variable rate construction payable | Construction loan | Parent | Maximum | ||
Mortgage loans payable | ||
Extension option period | 2 years | |
Co-investment venture, variable rate construction payable | Construction loan | Consolidated co-investment venture | ||
Mortgage loans payable | ||
Variable rate mortgages payable | 242,900,000 | 165,300,000 |
Interest rate base | Monthly LIBOR | |
Interest rate margin (as a percent) | 2.10% | |
Number of loans | 11 | |
Total loan commitment | $556,600,000 | |
One-month LIBOR | ||
Mortgage loans payable | ||
Monthly LIBOR interest rate at period end | 0.18% |
Mortgages_and_Notes_Payable_De1
Mortgages and Notes Payable (Details 2) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Contractual principal payments for the five subsequent years and thereafter | ||
Total consolidated mortgages and notes Payable | $1,232,200,000 | $1,186,481,000 |
Mortgages | ||
Contractual principal payments for the five subsequent years and thereafter | ||
April through December 2015 | 29,300,000 | |
2016 | 186,100,000 | |
2017 | 281,400,000 | |
2018 | 383,200,000 | |
2019 | 220,500,000 | |
Thereafter | 127,900,000 | |
Total | 1,228,400,000 | |
Add: unamortized adjustments from business combinations | 3,800,000 | |
Total consolidated mortgages and notes Payable | 1,232,200,000 | 1,186,500,000 |
Mortgages | Parent | ||
Contractual principal payments for the five subsequent years and thereafter | ||
April through December 2015 | 200,000 | |
2016 | 600,000 | |
2017 | 14,600,000 | |
2018 | 66,800,000 | |
2019 | 1,100,000 | |
Thereafter | 53,900,000 | |
Total | 137,200,000 | |
Total consolidated mortgages and notes Payable | 137,200,000 | 120,200,000 |
Mortgages | Consolidated co-investment venture | ||
Contractual principal payments for the five subsequent years and thereafter | ||
April through December 2015 | 29,100,000 | |
2016 | 185,500,000 | |
2017 | 266,800,000 | |
2018 | 316,400,000 | |
2019 | 219,400,000 | |
Thereafter | 74,000,000 | |
Total | 1,091,200,000 | 1,062,000,000 |
Add: unamortized adjustments from business combinations | 3,800,000 | 4,300,000 |
Total consolidated mortgages and notes Payable | $1,095,000,000 | $1,066,300,000 |
Credit_Facilities_Payable_Narr
Credit Facilities Payable (Narrative) (Details) (USD $) | 0 Months Ended | 3 Months Ended | |
Jan. 14, 2015 | Mar. 31, 2015 | Jan. 14, 2015 | |
One-month LIBOR | |||
Line of Credit Facility [Line Items] | |||
Monthly LIBOR interest rate at period end | 0.18% | ||
Credit facility | |||
Line of Credit Facility [Line Items] | |||
Net carrying value of real estate that collateralized the credit facility | $164,000,000 | ||
Percentage of the value of the collateral pool up to which borrowings can be made under the facility | 70.00% | ||
Total available amount under credit facility | 87,000,000 | ||
Maximum borrowing capacity | 150,000,000 | ||
Credit facility | Minimum | |||
Line of Credit Facility [Line Items] | |||
Borrowing required under the loan | 10,000,000 | ||
Consolidated net worth required to be maintained | 150,000,000 | ||
Consolidated liquidity required to be maintained | 15,000,000 | ||
Net operating income of the collateral pool required to be maintained expressed as percentage of the facility debt service cost | 155.00% | ||
Credit facility | Base rate | |||
Line of Credit Facility [Line Items] | |||
Variable rate basis | base rate | ||
Credit facility | One-month or three-month LIBOR rate | |||
Line of Credit Facility [Line Items] | |||
Variable rate basis | one-month or three-month LIBOR rate | ||
Credit facility | One-month LIBOR rate | |||
Line of Credit Facility [Line Items] | |||
Variable rate basis | one-month LIBOR | ||
Applicable margin (as a percent) | 2.08% | ||
Base rate (as a percent) | 0.18% | ||
Revolving Credit Facility | |||
Line of Credit Facility [Line Items] | |||
Revolving credit facility, current borrowing capacity | 200,000,000 | 200,000,000 | |
Consolidated net worth required to be maintained | 1,160,000,000 | ||
Extension option period | 1 year | ||
Additional capacity available after certain conditions | 200,000,000 | 200,000,000 | |
Maximum borrowing capacity | $400,000,000 | $400,000,000 | |
Maximum consolidated total indebtedness to total gross asset value | 65.00% | ||
Minimum adjusted consolidated EBITDA to consolidated fixed charges | 1.5 | ||
Maximum distributions as a percent of funds from operations | 95.00% | ||
Distributions as a percent of funds from operations | 83.00% | ||
Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | |||
Line of Credit Facility [Line Items] | |||
Applicable margin (as a percent) | 2.50% |
Credit_Facilities_Payable_Deta
Credit Facilities Payable (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Line of Credit Facility [Line Items] | ||
Credit facility payable | $35,000 | $10,000 |
Credit facility | ||
Line of Credit Facility [Line Items] | ||
Credit facility payable | 35,000 | 10,000 |
Revolving Credit Facility | ||
Line of Credit Facility [Line Items] | ||
Credit facility payable | $0 | $0 |
Noncontrolling_Interests_Detai
Noncontrolling Interests (Details) (USD $) | 3 Months Ended | 0 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Feb. 28, 2014 | Dec. 31, 2014 | |
joint_venture | ||||
Non-redeemable, Noncontrolling Interests | ||||
Subsidiary preferred units | $2,100,000 | $1,900,000 | ||
Non-redeemable noncontrolling interests | 526,003,000 | 540,747,000 | ||
Total | 23,038,000 | 20,638,000 | ||
Operating activities | 6,000,000 | 5,700,000 | ||
Developer CO-JVs | ||||
Non-redeemable, Noncontrolling Interests | ||||
Percent of noncontrolling interest sold | 37.00% | |||
Number of investments sold | 2 | |||
Sale of noncontrolling interest | 13,200,000 | |||
Decrease in additional paid in capital | 800,000 | |||
PGGM Co JVs | ||||
Non-redeemable, Noncontrolling Interests | ||||
Joint ventures | 377,800,000 | 390,500,000 | ||
Annual distribution rate (as a percent) | 12.50% | |||
Redemption price of preferred units (in dollars per unit) | $500 | |||
Face value of preferred units (in dollars per unit) | $500 | |||
Redemption premium remaining of preferred units | 0 | |||
PGGM Co JVs | Minimum | ||||
Non-redeemable, Noncontrolling Interests | ||||
Effective NCI (as a percent) | 26.00% | 26.00% | ||
Number of preferred units issued by subsidiary of joint venture | 121 | |||
Redemption premium of preferred units for first year (in dollars per unit) | $50 | |||
PGGM Co JVs | Maximum | ||||
Non-redeemable, Noncontrolling Interests | ||||
Effective NCI (as a percent) | 45.00% | 45.00% | ||
Number of preferred units issued by subsidiary of joint venture | 125 | |||
Redemption premium of preferred units for first year (in dollars per unit) | $100 | |||
Decline in redemption premium of preferred units (in dollars per unit) | $25 | |||
MW Co-Investment Partner | ||||
Non-redeemable, Noncontrolling Interests | ||||
Joint ventures | 142,600,000 | 144,900,000 | ||
Effective NCI (as a percent) | 45.00% | 45.00% | ||
Annual distribution rate (as a percent) | 12.50% | |||
Redemption price of preferred units (in dollars per unit) | $500 | |||
Redemption premium remaining of preferred units | 0 | |||
MW Co-Investment Partner | Minimum | ||||
Non-redeemable, Noncontrolling Interests | ||||
Number of preferred units issued by subsidiary of joint venture | 121 | |||
Redemption premium of preferred units for first year (in dollars per unit) | $50 | |||
MW Co-Investment Partner | Maximum | ||||
Non-redeemable, Noncontrolling Interests | ||||
Number of preferred units issued by subsidiary of joint venture | 125 | |||
Redemption premium of preferred units for first year (in dollars per unit) | $100 | |||
Decline in redemption premium of preferred units (in dollars per unit) | $25 | |||
Developer CO-JVs | ||||
Non-redeemable, Noncontrolling Interests | ||||
Joint ventures | $3,500,000 | $3,400,000 | ||
Effective NCI (as a percent) | 0.00% | 0.00% |
Noncontrolling_Interests_Detai1
Noncontrolling Interests (Details 1) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Noncontrolling Interest [Abstract] | ||
Operating activities | $6,000,000 | $5,700,000 |
Investing and financing activities | 17,000,000 | 14,900,000 |
Total | $23,038,000 | $20,638,000 |
Noncontrolling_Interests_Detai2
Noncontrolling Interests (Details 2) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
Redeemable, Noncontrolling Interest | ||
Amount | 32,043 | 32,012 |
Developer CO-JVs - Redeemable [Member] | ||
Redeemable, Noncontrolling Interest | ||
Amount | 32,000 | 32,000 |
Developer CO-JVs - Redeemable [Member] | Minimum | ||
Redeemable, Noncontrolling Interest | ||
Effective NCI (as a percent) | 0.00% | 0.00% |
Exercise Period of Put Options Requiring Entity to Acquire Partner Ownership Interest after Completion and Stabilization of Development | 1 year | |
Developer CO-JVs - Redeemable [Member] | Maximum | ||
Redeemable, Noncontrolling Interest | ||
Effective NCI (as a percent) | 10.00% | 10.00% |
Stockholders_Equity_Details
Stockholders' Equity (Details) (USD $) | 3 Months Ended | 0 Months Ended | |
Mar. 31, 2015 | Jul. 31, 2013 | Dec. 31, 2014 | |
vote | |||
Capitalization | |||
Preferred stock, shares issued | 10,000 | 10,000 | |
Preferred Stock, Dividend Rate, Percentage | 7.00% | ||
Preferred stock, par value (in dollars per share) | $0.00 | $0.00 | |
Preferred Stock, Liquidation Preference Per Share | $10 | ||
Series A Preferred Stock | Advisor | |||
Capitalization | |||
Preferred stock, shares issued | 10,000 | ||
Preferred Stock, Dividend Rate, Percentage | 7.00% | ||
Preferred stock, par value (in dollars per share) | $0.00 | ||
Number of Voting Rights Per Share | 1 | ||
Preferred Stock, Liquidation Preference Per Share | $10 | ||
Excess Percentage Preferred Stock Conversion Into Common Stock | 17.25% | ||
Cumulative Required Return On Issue Price Of Outstanding Shares, Percentage | 7.00% |
Stockholders_Equity_Details_2
Stockholders' Equity (Details 2) (USD $) | 3 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized for issuance | 20,000,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Share-based compensation expense | $0.50 | 0.2 | |
Restricted Stock Units (RSUs) | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Beginning balance | 254,691 | 6,000 | |
Issued | 424,799 | 239,220 | |
Exercised | -40,690 | 0 | |
Ending balance | 638,800 | 245,220 | |
Weighted-average grant date fair value | $9.42 | $10.03 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 82,897 | ||
Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Beginning balance | 0 | 0 | |
Issued | 25,777 | 0 | |
Forfeited | -3,256 | 0 | |
Ending balance | 22,521 | 0 | |
Weighted-average grant date fair value | $9.21 |
Stockholders_Equity_Details_3
Stockholders' Equity (Details 3) (USD $) | 3 Months Ended | 30 Months Ended | ||
Mar. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2014 | Sep. 30, 2014 | |
Equity [Abstract] | ||||
Daily distribution amount (in dollars per share) | $0.00 | |||
Annual distribution amount (in dollars per share) | $0.35 | |||
Common stock dividends authorized (in dollars per share) | $0.08 | $0.08 | $0.09 |
Stockholders_Equity_Details_4
Stockholders' Equity (Details 4) (USD $) | 3 Months Ended |
In Millions, except Share data, unless otherwise specified | Mar. 31, 2014 |
Share Redemption Program | |
Number of shares of common stock redeemed | 794,188 |
Common stock average redemption share price (in dollars per share) | $8.81 |
Common stock, value of redemption properly submitted | $7 |
Transition_Expenses_Details
Transition Expenses (Details) (Behringer Harvard Multifamily Advisors I, USD $) | 3 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2015 | Sep. 30, 2014 |
Transition to Self-Management [Line Items] | |||
Transaction to self-management, general transition services fee | $7.20 | ||
Payment for general transition services | 0.1 | ||
Transition to Self-Management | |||
Transition to Self-Management [Line Items] | |||
Proceeds from acquisition feeds repaid | $2.50 | $0.10 |
Transition_Expenses_Details_2
Transition Expenses (Details 2) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Transition to Self-Management [Line Items] | ||
Special Committee and Company legal and financial advisors | $200,000 | |
General transition services: Behringer | 200,000 | |
General transition services: Other service providers | 100,000 | |
Transition expenses | $0 | $520,000 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Dec. 31, 2014 | |
Commitments | ||
Deferred revenues, primarily lease revenues, net | $18,587,000 | $18,955,000 |
Commitments to provide affordable housing | ||
Commitments | ||
Reimbursement of annual payments made by the housing authority | 0 | |
Commitments to provide affordable housing | The Gallery At NoHo Commons | ||
Commitments | ||
Level annual payments made by the housing authority | 2,000,000 | |
Period during which no reimbursements are made by housing authority | 20 years | |
Liability under contract | 14,000,000 | |
Deferred revenues, primarily lease revenues, net | 18,000,000 | 18,300,000 |
Construction and development contracts | ||
Commitments | ||
Liability under contract | $309,500,000 | |
Period in which construction costs are expected to be paid | 24 months |
Commitments_and_Contingencies_2
Commitments and Contingencies (Details 2) (USD $) | Mar. 31, 2015 |
In Millions, unless otherwise specified | |
Commitments and Contingencies Disclosure [Abstract] | |
April 2015 through December 2015 | $0.50 |
2016 | 0.6 |
2017 | 0.8 |
2018 | 0.8 |
2019 | 0.8 |
Thereafter | 4 |
Total | $7.50 |
Fair_Value_of_Derivatives_and_2
Fair Value of Derivatives and Financial Instruments (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Recurring basis | ||
Fair value of derivatives and financial instruments | ||
Fair value adjustments | $0 | $0 |
Nonrecurring basis | ||
Fair value of derivatives and financial instruments | ||
Fair value adjustments | $0 | $0 |
Fair_Value_of_Derivatives_and_3
Fair Value of Derivatives and Financial Instruments (Details 2) (Level 2, Mortgages and notes payable, USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Millions, unless otherwise specified | ||
Carrying Amount | ||
Fair Value | ||
Mortgages and notes payable | $1,232.20 | $1,186.50 |
Fair Value | ||
Fair Value | ||
Mortgages and notes payable | $1,246.40 | $1,199.60 |
Related_Party_Arrangements_Det
Related Party Arrangements (Details) (USD $) | 3 Months Ended | 12 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
Other disclosures | |||
Acquisition and advisory fees | $0 | $1.80 | |
Property management fees | 0 | 5.5 | |
Debt financing fees | 0.2 | 0.2 | |
Asset management fees | 0 | 1.9 | |
Administrative expense reimbursements | $0 | $0.40 | |
Minimum | |||
Related Party Transaction [Line Items] | |||
Capital Market Servicing Fee, Percent Fee | 0.90% | ||
Maximum | |||
Related Party Transaction [Line Items] | |||
Capital Market Servicing Fee, Percent Fee | 1.00% |
Supplemental_Disclosures_of_Ca2
Supplemental Disclosures of Cash Flow Information (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Supplemental Cash Flow Information [Abstract] | ||
Interest paid, net of amounts capitalized of $4.8 million and $4.1 million in 2015 and 2014, respectively | $7.80 | $6.80 |
Interest capitalized | 4.8 | 4.1 |
Non-cash investing and financing activities: | ||
Transfer of real estate from construction in progress to operating real estate | 14.8 | 39.4 |
Transfer of assets to assets associated with real estate held for sale | 76.6 | 0 |
Stock issued pursuant to our DRIP | 0 | 7.6 |
Distributions payable - regular | 12.5 | 5 |
Construction costs and other related payables | $64 | $50.80 |
Subsequent_Events_Narrative_De
Subsequent Events (Narrative) (Details) (USD $) | 3 Months Ended | 1 Months Ended | 0 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2014 | 13-May-15 | 7-May-15 |
ownership_interest | |||||
community | |||||
Subsequent Event [Line Items] | |||||
Common stock dividends authorized (in dollars per share) | $0.08 | $0.08 | $0.09 | ||
Subsequent event | |||||
Subsequent Event [Line Items] | |||||
Common stock dividends authorized (in dollars per share) | $0.08 | ||||
Subsequent event | PGGM | |||||
Subsequent Event [Line Items] | |||||
Noncontrolling Interest, Number of Interests Acquired | 6 | ||||
Number of Multifamily Communities | 6 | ||||
Controlling Interest, Number of Interests Acquired | 1 | ||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Changes, Purchase of Interest by Parent | $119.50 | ||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Changes, Purchase of Interest by Parent, Cash on Hand | 9.5 | ||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Changes, Purchase of Interest by Parent, Draws on Credit Facility | 110 | ||||
Fee income received from Joint Venture | 1 | ||||
Promote Interest Payment | $3.50 |
Subsequent_Events_Acquisition_
Subsequent Events (Acquisition of Noncontrolling Interests and Controlling Interest) (Details) (Subsequent event) | 7-May-15 | 6-May-15 |
unit | ||
Subsequent Event [Line Items] | ||
Total Units | 2,061 | |
The District Universal Boulevard | Florida | ||
Subsequent Event [Line Items] | ||
Total Units | 425 | |
Equity investments - Ownership percentage by parent | 55.50% | |
Equity investments - Acquired Interest | 44.50% | |
Equity investments - Post Acquisition | 100.00% | |
Veritas | Nevada | ||
Subsequent Event [Line Items] | ||
Total Units | 430 | |
Equity investments - Ownership percentage by parent | 93.50% | 51.90% |
Equity investments - Acquired Interest | 41.60% | |
Effective NCI (as a percent) | 6.50% | |
The Cameron | Maryland | ||
Subsequent Event [Line Items] | ||
Total Units | 325 | |
Equity investments - Ownership percentage by parent | 55.50% | |
Equity investments - Acquired Interest | 44.50% | |
Equity investments - Post Acquisition | 100.00% | |
Skye 2905 | Colorado | ||
Subsequent Event [Line Items] | ||
Total Units | 400 | |
Equity investments - Ownership percentage by parent | 55.50% | |
Equity investments - Acquired Interest | 44.50% | |
Equity investments - Post Acquisition | 100.00% | |
Grand Reserve | Texas | ||
Subsequent Event [Line Items] | ||
Total Units | 149 | |
Equity investments - Ownership percentage by parent | 74.40% | |
Equity investments - Acquired Interest | 25.60% | |
Equity investments - Post Acquisition | 100.00% | |
Stone Gate | Massachusetts | ||
Subsequent Event [Line Items] | ||
Total Units | 332 | |
Equity investments - Ownership percentage by parent | 55.50% | |
Equity investments - Acquired Interest | 44.50% | |
Equity investments - Post Acquisition | 100.00% | |
Jefferson Creekside | Texas | ||
Subsequent Event [Line Items] | ||
Total Units | 444 | |
Debt investment - Ownership percentage by parent | 100.00% | 55.50% |
Debt investment - Acquired Interest | 44.50% |