Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2022 | Oct. 28, 2022 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Transition Report | false | |
Entity Registrant Name | AMERICAN ASSETS TRUST, INC. | |
Entity File Number | 001-35030 | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 27-3338708 | |
Entity Address, Address Line One | 3420 Carmel Mountain Road | |
Entity Address, Address Line Two | Suite 100 | |
Entity Address, City or Town | San Diego | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92121 | |
City Area Code | 858 | |
Local Phone Number | 350-2600 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | AAT | |
Security Exchange Name | NYSE | |
Entity Common Stock, Shares Outstanding | 60,528,115 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001500217 | |
Current Fiscal Year End Date | --12-31 | |
American Assets Trust, L.P. | ||
Entity Information [Line Items] | ||
Entity Registrant Name | AMERICAN ASSETS TRUST, L.P. | |
Entity File Number | 333-202342-01 | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 27-3338894 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001509570 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
ASSETS | ||
Operating real estate | $ 3,450,995 | $ 3,389,726 |
Construction in progress | 194,798 | 139,098 |
Held for development | 547 | 547 |
Total Real estate, at cost | 3,646,340 | 3,529,371 |
Accumulated depreciation | (910,556) | (847,390) |
Real estate, net | 2,735,784 | 2,681,981 |
Cash and cash equivalents | 63,431 | 139,524 |
Accounts receivable, net | 8,566 | 7,445 |
Deferred rent receivables, net | 88,375 | 82,724 |
Other assets, net | 112,421 | 106,253 |
Total assets | 3,008,577 | 3,017,927 |
LIABILITIES: | ||
Secured notes payable, net | 74,555 | 110,965 |
Unsecured notes payable, net | 1,538,986 | 1,538,238 |
Unsecured line of credit, net | 33,895 | 0 |
Accounts payable and accrued expenses | 72,355 | 64,531 |
Security deposits payable | 8,821 | 7,855 |
Other liabilities and deferred credits, net | 82,242 | 86,215 |
Total liabilities | 1,810,854 | 1,807,804 |
Commitments and contingencies (Note 12) | ||
American Assets Trust, Inc. stockholders’ equity | ||
Common stock, $0.01 par value, 490,000,000 shares authorized, 60,528,115 and 60,525,580 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively | 605 | 605 |
Additional paid-in capital | 1,458,748 | 1,453,272 |
Accumulated dividends in excess of net income | (241,549) | (217,785) |
Accumulated other comprehensive income | 12,554 | 2,872 |
Total American Assets Trust, Inc. stockholders’ equity | 1,230,358 | 1,238,964 |
Noncontrolling interests | (32,635) | (28,841) |
Total equity | 1,197,723 | 1,210,123 |
TOTAL LIABILITIES AND EQUITY | $ 3,008,577 | $ 3,017,927 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 490,000,000 | 490,000,000 |
Common stock, shares outstanding (shares) | 60,528,115 | 60,525,580 |
Common stock, shares issued (in shares) | 60,528,115 | 60,525,580 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
REVENUE: | ||||
Rental income | $ 105,468 | $ 93,804 | $ 301,470 | $ 262,573 |
Other property income | 5,555 | 4,482 | 15,178 | 11,508 |
Total revenue | 111,023 | 98,286 | 316,648 | 274,081 |
EXPENSES: | ||||
Rental expenses | 28,438 | 23,466 | 78,436 | 61,916 |
Real estate taxes | 11,477 | 9,644 | 34,193 | 31,610 |
General and administrative | 8,376 | 6,827 | 23,130 | 20,574 |
Depreciation and amortization | 31,729 | 30,680 | 93,228 | 85,827 |
Total operating expenses | 80,020 | 70,617 | 228,987 | 199,927 |
OPERATING INCOME | 31,003 | 27,669 | 87,661 | 74,154 |
Interest expense | (14,454) | (14,722) | (43,667) | (43,589) |
Loss on early extinguishment of debt | 0 | 0 | 0 | (4,271) |
Other (expense) income, net | (180) | (52) | (523) | (179) |
NET INCOME | 16,369 | 12,895 | 43,471 | 26,115 |
Net income attributable to restricted shares | (155) | (145) | (464) | (417) |
Net income attributable to unitholders in the Operating Partnership | (3,442) | (2,709) | (9,130) | (5,459) |
Net income attributable to American Assets Trust, Inc. stockholders | $ 12,772 | $ 10,041 | $ 33,877 | $ 20,239 |
EARNINGS PER COMMON SHARE, BASIC | ||||
Earnings per common share, basic (in USD per share) | $ 0.21 | $ 0.17 | $ 0.56 | $ 0.34 |
Weighted average shares of common stock outstanding-basic (in shares) | 60,044,117 | 59,990,343 | 60,041,034 | 59,986,844 |
EARNINGS PER COMMON SHARE, DILUTED | ||||
Earnings per common share, diluted (in USD per share) | $ 0.21 | $ 0.17 | $ 0.56 | $ 0.34 |
Weighted average shares of common stock outstanding-diluted (in shares) | 76,225,654 | 76,171,880 | 76,222,571 | 76,168,381 |
Dividends declared per common share (in USD per share) | $ 0.32 | $ 0.30 | $ 0.96 | $ 0.86 |
COMPREHENSIVE INCOME | ||||
Net income | $ 16,369 | $ 12,895 | $ 43,471 | $ 26,115 |
Other comprehensive income - change in value of interest rate swaps | 4,207 | 435 | 13,117 | 1,657 |
Comprehensive income | 20,301 | 13,056 | 55,763 | 26,755 |
Comprehensive income attributable to non-controlling interests | (4,277) | (2,744) | (11,739) | (5,604) |
Comprehensive income attributable to American Assets Trust, Inc. | 16,024 | 10,312 | 44,024 | 21,151 |
Interest Expense | ||||
COMPREHENSIVE INCOME | ||||
Reclassification of amortization of forward-starting swap realized gain | (275) | (274) | (825) | (824) |
Early Extinguishment of Debt | ||||
COMPREHENSIVE INCOME | ||||
Reclassification of amortization of forward-starting swap realized gain | $ 0 | $ 0 | $ 0 | $ (193) |
Consolidated Statement of Equit
Consolidated Statement of Equity (Unaudited) - USD ($) $ in Thousands | Total | Interest Expense | Early Extinguishment of Debt | Common Shares | Additional Paid-in Capital | Accumulated Dividends in Excess of Net Income | Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) Interest Expense | Accumulated Other Comprehensive Income (Loss) Early Extinguishment of Debt | Noncontrolling Interests - Unitholders in the Operating Partnership | Noncontrolling Interests - Unitholders in the Operating Partnership Interest Expense | Noncontrolling Interests - Unitholders in the Operating Partnership Early Extinguishment of Debt |
Beginning Balance (shares) at Dec. 31, 2020 | 60,476,292 | |||||||||||
Beginning Balance at Dec. 31, 2020 | $ 1,253,406 | $ 605 | $ 1,445,644 | $ (176,560) | $ 1,753 | $ (18,036) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 1,733 | 1,394 | 339 | |||||||||
Forfeiture of restricted stock (shares) | (4,006) | |||||||||||
Dividends declared and paid | (21,463) | (16,932) | (4,531) | |||||||||
Stock-based compensation | 1,484 | 1,484 | ||||||||||
Other comprehensive income - change in value of interest rate swaps | 747 | 579 | 168 | |||||||||
Reclassification of amortization of forward-starting swap realized gain | $ (275) | $ (193) | $ (216) | $ (152) | $ (59) | $ (41) | ||||||
Ending Balance (shares) at Mar. 31, 2021 | 60,472,286 | |||||||||||
Ending Balance at Mar. 31, 2021 | 1,235,439 | $ 605 | 1,447,128 | (192,098) | 1,964 | (22,160) | ||||||
Beginning Balance (shares) at Dec. 31, 2020 | 60,476,292 | |||||||||||
Beginning Balance at Dec. 31, 2020 | 1,253,406 | $ 605 | 1,445,644 | (176,560) | 1,753 | (18,036) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 26,115 | |||||||||||
Other comprehensive income - change in value of interest rate swaps | 1,657 | |||||||||||
Reclassification of amortization of forward-starting swap realized gain | (824) | (193) | ||||||||||
Ending Balance (shares) at Sep. 30, 2021 | 60,472,065 | |||||||||||
Ending Balance at Sep. 30, 2021 | 1,218,691 | $ 605 | 1,450,096 | (207,910) | 2,248 | (26,348) | ||||||
Beginning Balance (shares) at Mar. 31, 2021 | 60,472,286 | |||||||||||
Beginning Balance at Mar. 31, 2021 | 1,235,439 | $ 605 | 1,447,128 | (192,098) | 1,964 | (22,160) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 11,487 | 9,076 | 2,411 | |||||||||
Issuance of restricted stock (shares) | 5,184 | |||||||||||
Forfeiture of restricted stock (shares) | (2,604) | |||||||||||
Dividends declared and paid | (21,464) | (16,933) | (4,531) | |||||||||
Stock-based compensation | 1,484 | 1,484 | ||||||||||
Other comprehensive income - change in value of interest rate swaps | 475 | 374 | 101 | |||||||||
Reclassification of amortization of forward-starting swap realized gain | (275) | (216) | (59) | |||||||||
Ending Balance (shares) at Jun. 30, 2021 | 60,474,866 | |||||||||||
Ending Balance at Jun. 30, 2021 | 1,227,146 | $ 605 | 1,448,612 | (199,955) | 2,122 | (24,238) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 12,895 | 10,186 | 2,709 | |||||||||
Forfeiture of restricted stock (shares) | (2,801) | |||||||||||
Dividends declared and paid | (22,995) | (18,141) | (4,854) | |||||||||
Stock-based compensation | 1,484 | 1,484 | ||||||||||
Other comprehensive income - change in value of interest rate swaps | 435 | 342 | 93 | |||||||||
Reclassification of amortization of forward-starting swap realized gain | (274) | 0 | (216) | (58) | ||||||||
Ending Balance (shares) at Sep. 30, 2021 | 60,472,065 | |||||||||||
Ending Balance at Sep. 30, 2021 | $ 1,218,691 | $ 605 | 1,450,096 | (207,910) | 2,248 | (26,348) | ||||||
Beginning Balance (shares) at Dec. 31, 2021 | 60,525,580 | 60,525,580 | ||||||||||
Beginning Balance at Dec. 31, 2021 | $ 1,210,123 | $ 605 | 1,453,272 | (217,785) | 2,872 | (28,841) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 13,514 | 10,678 | 2,836 | |||||||||
Forfeiture of restricted stock (shares) | (3,121) | |||||||||||
Dividends declared and paid | (24,545) | (19,367) | (5,178) | |||||||||
Stock-based compensation | 1,489 | 1,489 | ||||||||||
Shares withheld for employee taxes (shares) | (416) | |||||||||||
Shares withheld for employee taxes | (15) | (15) | ||||||||||
Other comprehensive income - change in value of interest rate swaps | 5,596 | 4,408 | 1,188 | |||||||||
Reclassification of amortization of forward-starting swap realized gain | (275) | (217) | (58) | |||||||||
Ending Balance (shares) at Mar. 31, 2022 | 60,522,043 | |||||||||||
Ending Balance at Mar. 31, 2022 | $ 1,205,887 | $ 605 | 1,454,746 | (226,474) | 7,063 | (30,053) | ||||||
Beginning Balance (shares) at Dec. 31, 2021 | 60,525,580 | 60,525,580 | ||||||||||
Beginning Balance at Dec. 31, 2021 | $ 1,210,123 | $ 605 | 1,453,272 | (217,785) | 2,872 | (28,841) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 43,471 | |||||||||||
Other comprehensive income - change in value of interest rate swaps | $ 13,117 | |||||||||||
Reclassification of amortization of forward-starting swap realized gain | (825) | 0 | ||||||||||
Ending Balance (shares) at Sep. 30, 2022 | 60,528,115 | 60,528,115 | ||||||||||
Ending Balance at Sep. 30, 2022 | $ 1,197,723 | $ 605 | 1,458,748 | (241,549) | 12,554 | (32,635) | ||||||
Beginning Balance (shares) at Mar. 31, 2022 | 60,522,043 | |||||||||||
Beginning Balance at Mar. 31, 2022 | 1,205,887 | $ 605 | 1,454,746 | (226,474) | 7,063 | (30,053) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 13,588 | 10,736 | 2,852 | |||||||||
Issuance of restricted stock (shares) | 6,072 | |||||||||||
Dividends declared and paid | (24,547) | (19,369) | (5,178) | |||||||||
Stock-based compensation | 2,001 | 2,001 | ||||||||||
Other comprehensive income - change in value of interest rate swaps | 3,314 | 2,610 | 704 | |||||||||
Reclassification of amortization of forward-starting swap realized gain | (275) | (216) | (59) | |||||||||
Ending Balance (shares) at Jun. 30, 2022 | 60,528,115 | |||||||||||
Ending Balance at Jun. 30, 2022 | 1,199,968 | $ 605 | 1,456,747 | (235,107) | 9,457 | (31,734) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 16,369 | 12,927 | 3,442 | |||||||||
Dividends declared and paid | (24,547) | (19,369) | (5,178) | |||||||||
Stock-based compensation | 2,001 | 2,001 | ||||||||||
Other comprehensive income - change in value of interest rate swaps | $ 4,207 | 3,314 | 893 | |||||||||
Reclassification of amortization of forward-starting swap realized gain | $ (275) | $ 0 | $ (217) | $ (58) | ||||||||
Ending Balance (shares) at Sep. 30, 2022 | 60,528,115 | 60,528,115 | ||||||||||
Ending Balance at Sep. 30, 2022 | $ 1,197,723 | $ 605 | $ 1,458,748 | $ (241,549) | $ 12,554 | $ (32,635) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
OPERATING ACTIVITIES | ||
Net income | $ 43,471 | $ 26,115 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Deferred rent revenue and amortization of lease intangibles | (8,766) | (13,536) |
Depreciation and amortization | 93,228 | 85,827 |
Amortization of debt issuance costs and debt discounts | 1,930 | 1,734 |
Loss on early extinguishment of debt | 0 | 4,271 |
Provision for uncollectable rental income | (31) | (934) |
Stock-based compensation expense | 5,491 | 4,452 |
Other noncash interest expense | (825) | (824) |
Other, net | 684 | (927) |
Changes in operating assets and liabilities | ||
Change in accounts receivable | (1,072) | 941 |
Change in other assets | (1,115) | 225 |
Change in accounts payable and accrued expenses | 5,753 | 20,589 |
Change in security deposits payable | 777 | 584 |
Change in other liabilities and deferred credits | 1,367 | 1,115 |
Net cash provided by operating activities | 140,892 | 129,632 |
INVESTING ACTIVITIES | ||
Acquisition of real estate | (45,167) | (204,511) |
Capital expenditures | (88,314) | (56,772) |
Leasing commissions | (6,153) | (2,025) |
Purchases of marketable securities | 0 | (47,760) |
Proceeds from the sale of marketable securities | 0 | 47,723 |
Net cash used in investing activities | (139,634) | (263,345) |
FINANCING ACTIVITIES | ||
Issuance of secured notes payable | 75,000 | 0 |
Repayment of secured notes payable | (111,000) | 0 |
Proceeds from unsecured line of credit | 36,000 | 0 |
Repayment of unsecured line of credit | 0 | (100,000) |
Proceeds from unsecured notes payable | 0 | 494,675 |
Repayment of unsecured notes payable | 0 | (155,375) |
Debt issuance costs | (3,697) | (5,075) |
Dividends paid to common stock and unitholders | (73,639) | (65,922) |
Shares withheld for employee taxes | (15) | 0 |
Net cash (used in) provided by financing activities | (77,351) | 168,303 |
Net (decrease) increase in cash and cash equivalents | (76,093) | 34,590 |
Cash, cash equivalents and restricted cash, beginning of period | 139,524 | 139,049 |
Cash, cash equivalents and restricted cash, end of period | 63,431 | 173,639 |
Reconciliation of cash, cash equivalents and restricted cash | ||
Cash and cash equivalents | 63,431 | 171,923 |
Restricted cash | 0 | 1,716 |
Total cash, cash equivalents and restricted cash shown in the consolidated statement of cash flows | $ 63,431 | $ 173,639 |
Consolidated Balance Sheets - L
Consolidated Balance Sheets - LP - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Real estate, at cost | ||
Operating real estate | $ 3,450,995 | $ 3,389,726 |
Construction in progress | 194,798 | 139,098 |
Held for development | 547 | 547 |
Real estate, at cost | 3,646,340 | 3,529,371 |
Accumulated depreciation | (910,556) | (847,390) |
Real estate, net | 2,735,784 | 2,681,981 |
Cash and cash equivalents | 63,431 | 139,524 |
Accounts receivable, net | 8,566 | 7,445 |
Deferred rent receivables, net | 88,375 | 82,724 |
Other assets, net | 112,421 | 106,253 |
Assets acquired | 3,008,577 | 3,017,927 |
LIABILITIES: | ||
Secured notes payable, net | 74,555 | 110,965 |
Unsecured notes payable, net | 1,538,986 | 1,538,238 |
Unsecured line of credit, net | 33,895 | 0 |
Accounts payable and accrued expenses | 72,355 | 64,531 |
Security deposits payable | 8,821 | 7,855 |
Other liabilities and deferred credits, net | 82,242 | 86,215 |
Total liabilities | 1,810,854 | 1,807,804 |
Commitments and contingencies (Note 12) | ||
CAPITAL: | ||
Accumulated other comprehensive income | 12,554 | 2,872 |
TOTAL LIABILITIES AND EQUITY | 3,008,577 | 3,017,927 |
American Assets Trust, L.P. | ||
Real estate, at cost | ||
Operating real estate | 3,450,995 | 3,389,726 |
Construction in progress | 194,798 | 139,098 |
Held for development | 547 | 547 |
Real estate, at cost | 3,646,340 | 3,529,371 |
Accumulated depreciation | (910,556) | (847,390) |
Real estate, net | 2,735,784 | 2,681,981 |
Cash and cash equivalents | 63,431 | 139,524 |
Accounts receivable, net | 8,566 | 7,445 |
Deferred rent receivables, net | 88,375 | 82,724 |
Other assets, net | 112,421 | 106,253 |
Assets acquired | 3,008,577 | 3,017,927 |
LIABILITIES: | ||
Secured notes payable, net | 74,555 | 110,965 |
Unsecured notes payable, net | 1,538,986 | 1,538,238 |
Unsecured line of credit, net | 33,895 | 0 |
Accounts payable and accrued expenses | 72,355 | 64,531 |
Security deposits payable | 8,821 | 7,855 |
Other liabilities and deferred credits, net | 82,242 | 86,215 |
Total liabilities | 1,810,854 | 1,807,804 |
Commitments and contingencies (Note 12) | ||
CAPITAL: | ||
Limited partners' capital, 16,181,537 and 16,181,537 units issued and outstanding as of September 30, 2022 and December 31, 2021, respectively | (36,542) | (30,138) |
General partner's capital, 60,528,115 and 60,525,580 units issued and outstanding as of September 30, 2022 and December 31, 2021, respectively | 1,217,804 | 1,236,092 |
Accumulated other comprehensive income | 16,461 | 4,169 |
Total capital | 1,197,723 | 1,210,123 |
TOTAL LIABILITIES AND EQUITY | $ 3,008,577 | $ 3,017,927 |
Consolidated Balance Sheets -_2
Consolidated Balance Sheets - LP (Parenthetical) - American Assets Trust, L.P. - shares | Sep. 30, 2022 | Dec. 31, 2021 |
Limited partners' capital, units outstanding (in shares) | 16,181,537 | 16,181,537 |
Limited partners' capital, units issued (in shares) | 16,181,537 | 16,181,537 |
General partners' capital, units issued (in shares) | 60,528,115 | 60,525,580 |
General partners' capital, units outstanding (in shares) | 60,528,115 | 60,525,580 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Unaudited) - LP - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | ||
REVENUE: | |||||
Rental income | $ 105,468 | $ 93,804 | $ 301,470 | $ 262,573 | |
Other property income | 5,555 | 4,482 | 15,178 | 11,508 | |
Total revenue | 111,023 | 98,286 | 316,648 | 274,081 | |
EXPENSES: | |||||
Rental expenses | 28,438 | 23,466 | 78,436 | 61,916 | |
Real estate taxes | 11,477 | 9,644 | 34,193 | 31,610 | |
General and administrative | 8,376 | 6,827 | 23,130 | 20,574 | |
Depreciation and amortization | 31,729 | 30,680 | 93,228 | 85,827 | |
Total operating expenses | 80,020 | 70,617 | 228,987 | 199,927 | |
Operating income | 31,003 | 27,669 | 87,661 | 74,154 | |
Interest expense | (14,454) | (14,722) | (43,667) | (43,589) | |
Loss on early extinguishment of debt | 0 | 0 | 0 | (4,271) | |
Other (expense) income, net | (180) | (52) | (523) | (179) | |
Net income | 16,369 | 12,895 | 43,471 | 26,115 | |
Net income attributable to restricted shares | (155) | (145) | (464) | (417) | |
Net income attributable to American Assets Trust, Inc. stockholders | $ 12,772 | $ 10,041 | $ 33,877 | $ 20,239 | |
EARNINGS PER COMMON SHARE, BASIC | |||||
Earnings per unit, basic (in USD per share) | $ 0.21 | $ 0.17 | $ 0.56 | $ 0.34 | |
Weighted average units outstanding - basic (in shares) | 60,044,117 | 59,990,343 | 60,041,034 | 59,986,844 | |
EARNINGS PER COMMON SHARE, DILUTED | |||||
Earnings per unit, diluted (in USD per share) | $ 0.21 | $ 0.17 | $ 0.56 | $ 0.34 | |
Weighted average units outstanding - diluted (in shares) | 76,225,654 | 76,171,880 | 76,222,571 | 76,168,381 | |
COMPREHENSIVE INCOME | |||||
Net income | $ 16,369 | $ 12,895 | $ 43,471 | $ 26,115 | |
Other comprehensive income - change in value of interest rate swaps | 4,207 | 435 | 13,117 | 1,657 | |
Comprehensive income | 20,301 | 13,056 | 55,763 | 26,755 | |
Comprehensive income attributable to American Assets Trust, Inc. | 16,024 | 10,312 | 44,024 | 21,151 | |
Interest Expense | |||||
COMPREHENSIVE INCOME | |||||
Reclassification of amortization of forward-starting swap realized gain | (275) | (274) | (825) | (824) | |
Early Extinguishment of Debt | |||||
COMPREHENSIVE INCOME | |||||
Reclassification of amortization of forward-starting swap realized gain | 0 | 0 | 0 | (193) | |
American Assets Trust, L.P. | |||||
REVENUE: | |||||
Rental income | 105,468 | 93,804 | 301,470 | 262,573 | |
Other property income | 5,555 | 4,482 | 15,178 | 11,508 | |
Total revenue | 111,023 | 98,286 | 316,648 | 274,081 | |
EXPENSES: | |||||
Rental expenses | 28,438 | 23,466 | 78,436 | 61,916 | |
Real estate taxes | 11,477 | 9,644 | 34,193 | 31,610 | |
General and administrative | 8,376 | 6,827 | 23,130 | 20,574 | |
Depreciation and amortization | 31,729 | 30,680 | 93,228 | 85,827 | |
Total operating expenses | 80,020 | 70,617 | 228,987 | 199,927 | |
Operating income | 31,003 | 27,669 | 87,661 | 74,154 | |
Interest expense | (14,454) | (14,722) | (43,667) | (43,589) | |
Loss on early extinguishment of debt | 0 | 0 | 0 | (4,271) | |
Other (expense) income, net | (180) | (52) | (523) | (179) | |
Net income | 16,369 | 12,895 | 43,471 | 26,115 | |
Net income attributable to restricted shares | (155) | (145) | (464) | (417) | |
Net income attributable to American Assets Trust, Inc. stockholders | $ 16,214 | $ 12,750 | $ 43,007 | $ 25,698 | |
EARNINGS PER COMMON SHARE, BASIC | |||||
Earnings per unit, basic (in USD per share) | $ 0.21 | $ 0.17 | $ 0.56 | $ 0.34 | |
Weighted average units outstanding - basic (in shares) | 76,225,654 | 76,171,880 | 76,222,571 | 76,168,381 | |
EARNINGS PER COMMON SHARE, DILUTED | |||||
Earnings per unit, diluted (in USD per share) | $ 0.21 | $ 0.17 | $ 0.56 | $ 0.34 | |
Weighted average units outstanding - diluted (in shares) | 76,225,654 | 76,171,880 | 76,222,571 | 76,168,381 | |
Distributions per unit (in USD per share) | $ 0.32 | $ 0.30 | $ 0.96 | $ 0.86 | |
COMPREHENSIVE INCOME | |||||
Net income | $ 16,369 | $ 12,895 | $ 43,471 | $ 26,115 | |
Other comprehensive income - change in value of interest rate swaps | 4,207 | 435 | 13,117 | 1,657 | |
Comprehensive income | 20,301 | 13,056 | 55,763 | 26,755 | |
American Assets Trust, L.P. | Interest Expense | |||||
COMPREHENSIVE INCOME | |||||
Reclassification of amortization of forward-starting swap realized gain | (275) | (274) | (825) | (824) | |
American Assets Trust, L.P. | Early Extinguishment of Debt | |||||
COMPREHENSIVE INCOME | |||||
Reclassification of amortization of forward-starting swap realized gain | 0 | 0 | 0 | (193) | |
Limited Partner | American Assets Trust, L.P. | |||||
EXPENSES: | |||||
Net income | [1] | 3,442 | 2,709 | ||
COMPREHENSIVE INCOME | |||||
Net income | [1] | 3,442 | 2,709 | ||
Comprehensive income attributable to American Assets Trust, Inc. | (4,277) | (2,744) | (11,739) | (5,604) | |
General Partner | American Assets Trust, L.P. | |||||
EXPENSES: | |||||
Net income | [2] | 12,927 | 10,186 | ||
COMPREHENSIVE INCOME | |||||
Net income | [2] | 12,927 | 10,186 | ||
Comprehensive income attributable to American Assets Trust, Inc. | $ 16,024 | $ 10,312 | $ 44,024 | $ 21,151 | |
[1]Consists of limited partnership interests held by third parties.[2]Consists of general partnership interests held by American Assets Trust, Inc. |
Consolidated Statement of Partn
Consolidated Statement of Partners' Capital (Unaudited) - LP - USD ($) $ in Thousands | Total | Interest Expense | Early Extinguishment of Debt | American Assets Trust, L.P. | American Assets Trust, L.P. Interest Expense | American Assets Trust, L.P. Early Extinguishment of Debt | American Assets Trust, L.P. Accumulated Other Comprehensive Income (Loss) | American Assets Trust, L.P. Accumulated Other Comprehensive Income (Loss) Interest Expense | American Assets Trust, L.P. Accumulated Other Comprehensive Income (Loss) Early Extinguishment of Debt | American Assets Trust, L.P. Limited Partner | [1] | American Assets Trust, L.P. General Partner | ||
Beginning partners' capital account (shares) at Dec. 31, 2020 | 16,181,537 | 60,476,292 | [2] | |||||||||||
Beginning partners' capital account at Dec. 31, 2020 | $ 1,253,406 | $ 2,737 | $ (19,020) | $ 1,269,689 | [2] | |||||||||
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||||||||||
Net income | $ 1,733 | 1,733 | 339 | $ 1,394 | [2] | |||||||||
Forfeiture of restricted units (shares) | [2] | (4,006) | ||||||||||||
Distributions | (21,463) | $ (4,531) | $ (16,932) | [2] | ||||||||||
Stock-based compensation | 1,484 | $ 1,484 | [2] | |||||||||||
Other comprehensive income - change in value of interest rate swaps | 747 | 747 | 747 | |||||||||||
Reclassification of amortization of forward-starting swap realized gain | $ (275) | $ (193) | $ (275) | $ (193) | $ (275) | $ (193) | ||||||||
Ending partners' capital account (shares) at Mar. 31, 2021 | 16,181,537 | 60,472,286 | [2] | |||||||||||
Ending partners' capital account at Mar. 31, 2021 | 1,235,439 | 3,016 | $ (23,212) | $ 1,255,635 | [2] | |||||||||
Beginning partners' capital account (shares) at Dec. 31, 2020 | 16,181,537 | 60,476,292 | [2] | |||||||||||
Beginning partners' capital account at Dec. 31, 2020 | 1,253,406 | 2,737 | $ (19,020) | $ 1,269,689 | [2] | |||||||||
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||||||||||
Net income | 26,115 | 26,115 | ||||||||||||
Other comprehensive income - change in value of interest rate swaps | 1,657 | 1,657 | ||||||||||||
Reclassification of amortization of forward-starting swap realized gain | (824) | (193) | (824) | (193) | ||||||||||
Ending partners' capital account (shares) at Sep. 30, 2021 | 16,181,537 | 60,472,065 | [2] | |||||||||||
Ending partners' capital account at Sep. 30, 2021 | 1,218,691 | 3,377 | $ (27,477) | $ 1,242,791 | [2] | |||||||||
Beginning partners' capital account (shares) at Mar. 31, 2021 | 16,181,537 | 60,472,286 | [2] | |||||||||||
Beginning partners' capital account at Mar. 31, 2021 | 1,235,439 | 3,016 | $ (23,212) | $ 1,255,635 | [2] | |||||||||
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||||||||||
Net income | 11,487 | 11,487 | 2,411 | $ 9,076 | [2] | |||||||||
Issuance of restricted stock (shares) | [2] | 5,184 | ||||||||||||
Forfeiture of restricted units (shares) | [2] | (2,604) | ||||||||||||
Distributions | (21,464) | $ (4,531) | $ (16,933) | [2] | ||||||||||
Stock-based compensation | 1,484 | $ 1,484 | [2] | |||||||||||
Other comprehensive income - change in value of interest rate swaps | 475 | 475 | 475 | |||||||||||
Reclassification of amortization of forward-starting swap realized gain | (275) | (275) | (275) | |||||||||||
Ending partners' capital account (shares) at Jun. 30, 2021 | 16,181,537 | 60,474,866 | [2] | |||||||||||
Ending partners' capital account at Jun. 30, 2021 | 1,227,146 | 3,216 | $ (25,332) | $ 1,249,262 | [2] | |||||||||
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||||||||||
Net income | 12,895 | 12,895 | 2,709 | $ 10,186 | [2] | |||||||||
Forfeiture of restricted units (shares) | [2] | (2,801) | ||||||||||||
Distributions | (22,995) | $ (4,854) | $ (18,141) | [2] | ||||||||||
Stock-based compensation | 1,484 | $ 1,484 | [2] | |||||||||||
Other comprehensive income - change in value of interest rate swaps | 435 | 435 | 435 | |||||||||||
Reclassification of amortization of forward-starting swap realized gain | (274) | 0 | (274) | 0 | (274) | |||||||||
Ending partners' capital account (shares) at Sep. 30, 2021 | 16,181,537 | 60,472,065 | [2] | |||||||||||
Ending partners' capital account at Sep. 30, 2021 | 1,218,691 | 3,377 | $ (27,477) | $ 1,242,791 | [2] | |||||||||
Beginning partners' capital account (shares) at Dec. 31, 2021 | 16,181,537 | 60,525,580 | [2] | |||||||||||
Beginning partners' capital account at Dec. 31, 2021 | 1,210,123 | 4,169 | $ (30,138) | $ 1,236,092 | [2] | |||||||||
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||||||||||
Net income | 13,514 | 13,514 | 2,836 | $ 10,678 | [2] | |||||||||
Forfeiture of restricted units (shares) | [2] | (3,121) | ||||||||||||
Distributions | (24,545) | $ (5,178) | $ (19,367) | [2] | ||||||||||
Stock-based compensation | 1,489 | $ 1,489 | [2] | |||||||||||
Units withheld for employee taxes (shares) | [2] | (416) | ||||||||||||
Units withheld for employee taxes | (15) | (15) | $ (15) | [2] | ||||||||||
Other comprehensive income - change in value of interest rate swaps | 5,596 | 5,596 | 5,596 | |||||||||||
Reclassification of amortization of forward-starting swap realized gain | (275) | (275) | (275) | |||||||||||
Ending partners' capital account (shares) at Mar. 31, 2022 | 16,181,537 | 60,522,043 | [2] | |||||||||||
Ending partners' capital account at Mar. 31, 2022 | 1,205,887 | 9,490 | $ (32,480) | $ 1,228,877 | [2] | |||||||||
Beginning partners' capital account (shares) at Dec. 31, 2021 | 16,181,537 | 60,525,580 | [2] | |||||||||||
Beginning partners' capital account at Dec. 31, 2021 | 1,210,123 | 4,169 | $ (30,138) | $ 1,236,092 | [2] | |||||||||
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||||||||||
Net income | 43,471 | 43,471 | ||||||||||||
Other comprehensive income - change in value of interest rate swaps | 13,117 | 13,117 | ||||||||||||
Reclassification of amortization of forward-starting swap realized gain | (825) | 0 | (825) | 0 | ||||||||||
Ending partners' capital account (shares) at Sep. 30, 2022 | 16,181,537 | 60,528,115 | [2] | |||||||||||
Ending partners' capital account at Sep. 30, 2022 | 1,197,723 | 16,461 | $ (36,542) | $ 1,217,804 | [2] | |||||||||
Beginning partners' capital account (shares) at Mar. 31, 2022 | 16,181,537 | 60,522,043 | [2] | |||||||||||
Beginning partners' capital account at Mar. 31, 2022 | 1,205,887 | 9,490 | $ (32,480) | $ 1,228,877 | [2] | |||||||||
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||||||||||
Net income | 13,588 | 13,588 | 2,852 | $ 10,736 | [2] | |||||||||
Issuance of restricted stock (shares) | [2] | 6,072 | ||||||||||||
Distributions | (24,547) | $ (5,178) | $ (19,369) | [2] | ||||||||||
Stock-based compensation | 2,001 | $ 2,001 | [2] | |||||||||||
Other comprehensive income - change in value of interest rate swaps | 3,314 | 3,314 | 3,314 | |||||||||||
Reclassification of amortization of forward-starting swap realized gain | (275) | (275) | (275) | |||||||||||
Ending partners' capital account (shares) at Jun. 30, 2022 | 16,181,537 | 60,528,115 | [2] | |||||||||||
Ending partners' capital account at Jun. 30, 2022 | 1,199,968 | 12,529 | $ (34,806) | $ 1,222,245 | [2] | |||||||||
Increase (Decrease) in Partners' Capital [Roll Forward] | ||||||||||||||
Net income | 16,369 | 16,369 | 3,442 | 12,927 | [2] | |||||||||
Distributions | (24,547) | $ (5,178) | (19,369) | [2] | ||||||||||
Stock-based compensation | 2,001 | $ 2,001 | [2] | |||||||||||
Other comprehensive income - change in value of interest rate swaps | $ 4,207 | 4,207 | 4,207 | |||||||||||
Reclassification of amortization of forward-starting swap realized gain | $ (275) | $ 0 | $ (275) | $ 0 | $ (275) | |||||||||
Ending partners' capital account (shares) at Sep. 30, 2022 | 16,181,537 | 60,528,115 | [2] | |||||||||||
Ending partners' capital account at Sep. 30, 2022 | $ 1,197,723 | $ 16,461 | $ (36,542) | $ 1,217,804 | [2] | |||||||||
[1]Consists of limited partnership interests held by third parties.[2]Consists of general partnership interests held by American Assets Trust, Inc. |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Unaudited) - LP - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
OPERATING ACTIVITIES | ||
Net income | $ 43,471 | $ 26,115 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Deferred rent revenue and amortization of lease intangibles | (8,766) | (13,536) |
Depreciation and amortization | 93,228 | 85,827 |
Amortization of debt issuance costs and debt discounts | 1,930 | 1,734 |
Loss on early extinguishment of debt | 0 | 4,271 |
Provision for uncollectable rental income | (31) | (934) |
Stock-based compensation expense | 5,491 | 4,452 |
Other noncash interest expense | (825) | (824) |
Other, net | 684 | (927) |
Changes in operating assets and liabilities | ||
Change in accounts receivable | (1,072) | 941 |
Change in other assets | (1,115) | 225 |
Change in accounts payable and accrued expenses | 5,753 | 20,589 |
Change in security deposits payable | 777 | 584 |
Change in other liabilities and deferred credits | 1,367 | 1,115 |
Net cash provided by operating activities | 140,892 | 129,632 |
INVESTING ACTIVITIES | ||
Acquisition of real estate | (45,167) | (204,511) |
Capital expenditures | (88,314) | (56,772) |
Leasing commissions | (6,153) | (2,025) |
Purchases of marketable securities | 0 | (47,760) |
Proceeds from the sale of marketable securities | 0 | 47,723 |
Net cash used in investing activities | (139,634) | (263,345) |
FINANCING ACTIVITIES | ||
Issuance of secured notes payable | 75,000 | 0 |
Repayment of secured notes payable | (111,000) | 0 |
Proceeds from unsecured line of credit | 36,000 | 0 |
Repayment of unsecured line of credit | 0 | (100,000) |
Proceeds from unsecured notes payable | 0 | 494,675 |
Repayment of unsecured notes payable | 0 | (155,375) |
Debt issuance costs | (3,697) | (5,075) |
Dividends paid to common stock and unitholders | (73,639) | (65,922) |
Shares withheld for employee taxes | (15) | 0 |
Net cash (used in) provided by financing activities | (77,351) | 168,303 |
Net (decrease) increase in cash and cash equivalents | (76,093) | 34,590 |
Cash, cash equivalents and restricted cash, beginning of period | 139,524 | 139,049 |
Cash, cash equivalents and restricted cash, end of period | 63,431 | 173,639 |
Cash and cash equivalents | 63,431 | 171,923 |
Restricted cash | 0 | 1,716 |
Total cash, cash equivalents and restricted cash shown in the consolidated statement of cash flows | 63,431 | 173,639 |
American Assets Trust, L.P. | ||
OPERATING ACTIVITIES | ||
Net income | 43,471 | 26,115 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Deferred rent revenue and amortization of lease intangibles | (8,766) | (13,536) |
Depreciation and amortization | 93,228 | 85,827 |
Amortization of debt issuance costs and debt discounts | 1,930 | 1,734 |
Loss on early extinguishment of debt | 0 | 4,271 |
Provision for uncollectable rental income | (31) | (934) |
Stock-based compensation expense | 5,491 | 4,452 |
Other noncash interest expense | (825) | (824) |
Other, net | 684 | (927) |
Changes in operating assets and liabilities | ||
Change in accounts receivable | (1,072) | 941 |
Change in other assets | (1,115) | 225 |
Change in accounts payable and accrued expenses | 5,753 | 20,589 |
Change in security deposits payable | 777 | 584 |
Change in other liabilities and deferred credits | 1,367 | 1,115 |
Net cash provided by operating activities | 140,892 | 129,632 |
INVESTING ACTIVITIES | ||
Acquisition of real estate | (45,167) | (204,511) |
Capital expenditures | (88,314) | (56,772) |
Leasing commissions | (6,153) | (2,025) |
Purchases of marketable securities | 0 | (47,760) |
Proceeds from the sale of marketable securities | 0 | 47,723 |
Net cash used in investing activities | (139,634) | (263,345) |
FINANCING ACTIVITIES | ||
Issuance of secured notes payable | 75,000 | 0 |
Repayment of secured notes payable | (111,000) | 0 |
Proceeds from unsecured line of credit | 36,000 | 0 |
Repayment of unsecured line of credit | 0 | (100,000) |
Proceeds from unsecured notes payable | 0 | 494,675 |
Repayment of unsecured notes payable | 0 | (155,375) |
Debt issuance costs | (3,697) | (5,075) |
Dividends paid to common stock and unitholders | (73,639) | (65,922) |
Shares withheld for employee taxes | (15) | 0 |
Net cash (used in) provided by financing activities | (77,351) | 168,303 |
Net (decrease) increase in cash and cash equivalents | (76,093) | 34,590 |
Cash, cash equivalents and restricted cash, beginning of period | 139,524 | 139,049 |
Cash, cash equivalents and restricted cash, end of period | 63,431 | 173,639 |
Cash and cash equivalents | 63,431 | 171,923 |
Restricted cash | 0 | 1,716 |
Total cash, cash equivalents and restricted cash shown in the consolidated statement of cash flows | $ 63,431 | $ 173,639 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business and Organization American Assets Trust, Inc. (which may be referred to in these financial statements as the “Company,” “we,” “us,” or “our”) is a Maryland corporation formed on July 16, 2010 that did not have any operating activity until the consummation of our initial public offering on January 19, 2011. The Company is the sole general partner of American Assets Trust, L.P., a Maryland limited partnership formed on July 16, 2010 (the “Operating Partnership”). The Company’s operations are carried on through our Operating Partnership and its subsidiaries, including our taxable real estate investment trust ("REIT") subsidiary ("TRS"). Since the formation of our Operating Partnership, the Company has controlled our Operating Partnership as its general partner and has consolidated its assets, liabilities and results of operations. We are a full service, vertically integrated, and self-administered REIT with approximately 212 employees providing substantial in-house expertise in asset management, property management, property development, leasing, tenant improvement construction, acquisitions, repositioning, redevelopment and financing. As of September 30, 2022, we owned or had a controlling interest in 31 office, retail, multifamily and mixed-use operating properties, the operations of which we consolidate. Additionally, as of September 30, 2022, we owned land at three of our properties that we classify as held for development and/or construction in progress. A summary of the properties owned by us is as follows: Retail Carmel Country Plaza Gateway Marketplace Alamo Quarry Market Carmel Mountain Plaza Del Monte Center Hassalo on Eighth - Retail South Bay Marketplace Geary Marketplace Lomas Santa Fe Plaza The Shops at Kalakaua Solana Beach Towne Centre Waikele Center Office La Jolla Commons One Beach Street Corporate Campus East III Torrey Reserve Campus First & Main Bel-Spring 520 Torrey Point Lloyd Portfolio Solana Crossing City Center Bellevue The Landmark at One Market Eastgate Office Park Multifamily Loma Palisades Hassalo on Eighth - Residential Imperial Beach Gardens Mariner's Point Santa Fe Park RV Resort Pacific Ridge Apartments Mixed-Use Waikiki Beach Walk Retail and Embassy Suites™ Hotel Held for Development and/or Construction in Progress La Jolla Commons – Land Solana Crossing – Land Lloyd Portfolio – Construction in Progress Basis of Presentation Our consolidated financial statements include the accounts of the Company, our Operating Partnership and our subsidiaries. The equity interests of other investors in our Operating Partnership are reflected as noncontrolling interests. The Company follows the Financial Accounting Standards Board (the "FASB") guidance for determining whether an entity is a variable interest entity (“VIE”) and requires the performance of a qualitative rather than a quantitative analysis to determine the primary beneficiary of a VIE. Under this guidance, an entity would be required to consolidate a VIE if it has (i) the power to direct the activities that most significantly impact the entity’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could be significant to the VIE. American Assets Trust, Inc. has concluded that the Operating Partnership is a VIE, and because American Assets Trust, Inc. has both the power and the rights to control the Operating Partnership, American Assets Trust, Inc. is the primary beneficiary and is required to continue to consolidate the Operating Partnership. Substantially all of the assets and liabilities of the Company are related to the operating partnership VIE. All intercompany transactions and balances are eliminated in consolidation. The accompanying consolidated financial statements of the Company and the Operating Partnership have been prepared in accordance with the rules applicable to Form 10-Q and include all information and footnotes required for interim financial statement presentation, but do not include all disclosures required under accounting principles generally accepted in the United States (“GAAP”) for annual financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments, except as otherwise noted) considered necessary for a fair presentation have been included. These financial statements should be read in conjunction with the audited consolidated financial statements and notes therein included in the Company's and Operating Partnership's annual report on Form 10-K for the year ended December 31, 2021. The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that in certain circumstances affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and revenues and expenses. These estimates are prepared using our best judgment, after considering past, current and expected events and economic conditions. Actual results could differ from these estimates. Any reference to the number of properties, number of units, square footage, employee numbers or percentages of beneficial ownership of our shares are unaudited and outside the scope of our independent registered public accounting firm’s review of our financial statements in accordance with the standards of the United States Public Company Accounting Oversight Board. Consolidated Statements of Cash Flows—Supplemental Disclosures The following table provides supplemental disclosures related to the Consolidated Statements of Cash Flows (in thousands): Nine Months Ended September 30, 2022 2021 Supplemental cash flow information Total interest costs incurred $ 47,792 $ 45,618 Interest capitalized $ 4,125 $ 2,029 Interest expense $ 43,667 $ 43,589 Cash paid for interest, net of amounts capitalized $ 48,145 $ 42,311 Cash paid for income taxes $ 638 $ 289 Supplemental schedule of noncash investing and financing activities Accounts payable and accrued liabilities for construction in progress $ 20,750 $ 10,119 Accrued leasing commissions $ 1,897 $ 1,072 Significant Accounting Policies We describe our significant accounting policies in Note 1 to the consolidated financial statements in Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2021. There have been no changes to our significant accounting policies during the nine months ended September 30, 2022. Segment Information Segment information is prepared on the same basis that our chief operating decision maker reviews information for operational decision-making purposes. We operate in four business segments: the acquisition, redevelopment, ownership and management of office real estate, retail real estate, multifamily real estate and mixed-use real estate. The products for our office segment primarily include rental of office space and other tenant services, including tenant reimbursements, parking and storage space rental. The products for our retail segment primarily include rental of retail space and other tenant services, including tenant reimbursements, parking and storage space rental. The products for our multifamily segment include rental of apartments and other tenant services. The products of our mixed-use segment include rental of retail space and other tenant services, including tenant reimbursements, parking and storage space rental and operation of a 369-room all-suite hotel. Revenue Recognition and Accounts Receivable Our leases with tenants are classified as operating leases. Substantially all such leases contain fixed rent escalations which occur at specified times during the term of the lease. Base rents are recognized on a straight-line basis from when the tenant controls the space through the term of the related lease, net of valuation adjustments, based on management's assessment of credit, collection and other business risks. We make estimates of the collectability of our current accounts receivable and straight-line rents receivable which require significant judgment by management. The collectability of receivables is affected by numerous different factors including current economic conditions, the impact of tenant bankruptcies, the status of collectability of current cash rents receivable, tenants' recent and historical financial and operating results, changes in our tenants' credit ratings, communications between our operating personnel and tenants, the extent of security deposits and letters of credit held with respect to tenants, and the ability of tenants to perform under the terms of their lease agreement. The provision for doubtful accounts at September 30, 2022 and December 31, 2021 was approximately $2.8 million and $4.6 million, respectively. Rent Concessions – COVID-19 From 2020 through 2022, we provided lease concessions to certain tenants, primarily within the retail segment, as a result of the COVID-19 pandemic, in the form of rent deferrals and abatements. These lease concessions generally included an increase in our rights as a lessor. We assess each lease concession and determine whether it represents a lease modifications under Accounting Standards Codification Topic 842, Leases ("ASC 842"). During the third quarter of 2022, we provided an immaterial amount of lease concessions to certain tenants that were previously impacted by and/or continued being impacted by the COVID-19 pandemic. Recent Accounting Pronouncements In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848), which provides companies with optional practical expedients to ease the accounting burden for contract modifications associated with transitioning away from LIBOR and other interbank offered rates that are expected to be discontinued as part of reference rate reform. For hedges, the guidance generally allows changes to the reference rate and other critical terms without having to de-designate the hedging relationship, and permits the shortcut method to continue to be applied. For contract modifications, changes in the reference rate or other critical terms will be treated as a continuation of the prior contract. This guidance can be applied immediately, however, it is generally only available through December 31, 2022, with a newly proposed sunset date of December 31, 2024. We are still evaluating the impact of reference rate reform and whether we will apply any of these practical expedients. |
REAL ESTATE
REAL ESTATE | 9 Months Ended |
Sep. 30, 2022 | |
Real Estate [Abstract] | |
REAL ESTATE | REAL ESTATE Property Asset Acquisitions On March 8, 2022, we acquired Bel-Spring 520 in Bellevue, Washington, consisting of an approximately 93,000 square feet, multi-tenant office campus. The purchase price was $45.5 million , less seller credits of approximately $0.1 million of future rent abatement, and approximately $0.6 million of contractual tenant improvements. Additionally, closing costs were approximately $0.1 million. The property was acquired with cash on hand. The financial information set forth below summarizes the Company’s purchase price allocation for Bel-Spring 520 during the nine months ended September 30, 2022 (in thousands): Bel-Spring 520 Land $ 13,744 Building 27,793 Land improvements 713 Furniture, fixtures, and equipment 1,833 Total real estate 44,083 Lease intangibles 2,036 Prepaid expenses and other assets 10 Assets acquired $ 46,129 Accounts payable and accrued expenses $ (14) Security deposits payable (189) Other liabilities and deferred credits (641) Liabilities assumed $ (844) The value allocated to lease intangibles is amortized over the related lease term as depreciation and amortization expense in the statement of income. The remaining weighted average amortization period as of September 30, 2022, is 3.3. The following table summarizes the operating results for Bel-Spring 520 included in the Company's historical consolidated statement of operations for the period of acquisition through September 30, 2022 (in thousands): Bel-Spring 520 Revenues $ 1,733 Operating expenses 1,689 Operating income 44 Net income attributable to American Assets Trust, Inc. $ 44 |
ACQUIRED IN-PLACE LEASES AND AB
ACQUIRED IN-PLACE LEASES AND ABOVE/BELOW MARKET LEASES | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
ACQUIRED IN-PLACE LEASES AND ABOVE/BELOW MARKET LEASES | ACQUIRED IN-PLACE LEASES AND ABOVE/BELOW MARKET LEASES The following summarizes our acquired lease intangibles and leasing costs, which are included in other assets and other liabilities and deferred credits, as of September 30, 2022 and December 31, 2021 (in thousands): September 30, 2022 December 31, 2021 In-place leases $ 58,119 $ 67,215 Accumulated amortization (33,216) (38,130) Above market leases 1,885 2,532 Accumulated amortization (1,768) (2,383) Acquired lease intangible assets, net $ 25,020 $ 29,234 Below market leases $ 52,832 $ 58,655 Accumulated accretion (32,347) (36,253) Acquired lease intangible liabilities, net $ 20,485 $ 22,402 |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | FAIR VALUE OF FINANCIAL INSTRUMENTS A fair value measurement is based on the assumptions that market participants would use in pricing an asset or liability. The hierarchy for inputs used in measuring fair value is as follows: 1. Level 1 Inputs—quoted prices in active markets for identical assets or liabilities 2. Level 2 Inputs—observable inputs other than quoted prices in active markets for identical assets and liabilities 3. Level 3 Inputs—unobservable inputs The carrying values of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued liabilities are reasonable estimates of fair value, using Level 1 inputs, because of the short-term nature of these instruments. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. We measure the fair value of our deferred compensation liability, which is included in other liabilities and deferred credits on the consolidated balance sheet, on a recurring basis using Level 2 inputs. We measure the fair value of this liability based on prices provided by independent market participants that are based on observable inputs using market-based valuation techniques. The fair value of the interest rate swap agreements are based on the estimated amounts we would receive or pay to terminate the contract at the reporting date and are determined using interest rate pricing models and interest rate related observable inputs. The changes in the fair value of the derivatives that are designated as cash flow hedges are being recorded in accumulated other comprehensive income (loss) and will be subsequently reclassified into earnings during the period in which the hedged forecasted transaction affects earnings. We incorporate credit valuation adjustments to appropriately reflect both our own non-performance risk and the respective counterparty’s non-performance risk in the fair value measurements. In adjusting the fair value of our derivative contracts for the effect of non-performance risk, we considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees. Although we have determined that the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by itself and its counterparties. However, as of September 30, 2022 we have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative position and have determined that the credit valuation adjustments are not significant to the overall valuation of our derivative. As a result, we have determined that our derivative valuation in its entirety is classified in Level 2 of the fair value hierarchy. A summary of our financial liabilities that are measured at fair value on a recurring basis, by level within the fair value hierarchy is as follows (in thousands): September 30, 2022 December 31, 2021 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Deferred compensation liability $ — $ 2,288 $ — $ 2,288 $ — $ 2,503 $ — $ 2,503 Interest rate swap asset $ — $ 11,310 $ — $ 11,310 $ — $ — $ — $ — Interest rate swap liability $ — $ — $ — $ — $ — $ 1,807 $ — $ 1,807 The fair value of our secured notes payable and unsecured senior guaranteed notes are sensitive to fluctuations in interest rates. Discounted cash flow analysis using observable market interest rates (Level 2) is generally used to estimate the fair value of our secured notes payable, using rates ranging from 5.6% to 6.1%. Considerable judgment is necessary to estimate the fair value of financial instruments. The estimates of fair value presented herein are not necessarily indicative of the amounts that could be realized upon disposition of the financial instruments. The carrying values of our term loans set forth below are deemed to be at fair value since the outstanding debt related to Term Loans B and C are directly tied to monthly LIBOR contracts and Term Loan A is directly tied to the monthly SOFR contract. A summary of the carrying amount and fair value of our secured financial instruments, all of which are based on Level 2 inputs, is as follows (in thousands): September 30, 2022 December 31, 2021 Carrying Value Fair Value Carrying Value Fair Value Secured notes payable, net $ 74,555 $ 74,110 $ 110,965 $ 113,207 Unsecured term loans, net $ 249,321 $ 250,000 $ 249,654 $ 250,000 Unsecured senior guaranteed notes, net $ 798,260 $ 759,008 $ 797,953 $ 832,795 Senior unsecured notes, net $ 491,405 $ 403,500 $ 490,631 $ 503,000 Unsecured line of credit, net $ 33,895 $ 36,000 $ — $ — |
DERIVATIVE AND HEDGING ACTIVITI
DERIVATIVE AND HEDGING ACTIVITIES | 9 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE AND HEDGING ACTIVITIES | DERIVATIVE AND HEDGING ACTIVITIESOur objectives in using interest rate derivatives are to add stability to interest expense and to manage our exposure to interest rate movements. To accomplish these objectives, we primarily use interest rate swaps as part of our interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for us making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. The following is a summary of the terms of our outstanding interest rate swaps as of September 30, 2022 (dollars in thousands): Swap Counterparty Notional Amount Effective Date Maturity Date Fair Value U.S. Bank N.A. $ 100,000 3/1/2016 3/1/2023 $ 1,142 Wells Fargo Bank, N.A. $ 50,000 5/2/2016 3/1/2023 $ 570 Bank of America, N.A. $ 50,000 1/14/2022 1/5/2027 $ 4,807 Wells Fargo Bank, N.A. $ 50,000 1/14/2022 1/5/2027 $ 4,791 The effective portion of changes in the fair value of the derivatives that are designated as cash flow hedges are being recorded in accumulated other comprehensive income and will be subsequently reclassified into earnings during the period in which the hedged forecasted transaction affects earnings for as long as hedged cash flows remain probable. During the next twelve months, we estimate the cash flow hedges in place will reduce interest expense by approximately $1.1 million. |
OTHER ASSETS
OTHER ASSETS | 9 Months Ended |
Sep. 30, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
OTHER ASSETS | OTHER ASSETS Other assets consist of the following (in thousands): September 30, 2022 December 31, 2021 Leasing commissions, net of accumulated amortization of $41,197 and $40,595, respectively $ 38,590 $ 38,589 Interest rate swap asset 11,310 — Acquired above market leases, net 117 149 Acquired in-place leases, net 24,903 29,085 Lease incentives, net of accumulated amortization of $979 and $913, respectively 1,097 595 Other intangible assets, net of accumulated amortization of $1,456 and $1,382, respectively 2,259 2,445 Right-of-use lease asset, net 24,512 26,254 Prepaid expenses and other 9,633 9,136 Total other assets $ 112,421 $ 106,253 |
OTHER LIABILITIES AND DEFERRED
OTHER LIABILITIES AND DEFERRED CREDITS | 9 Months Ended |
Sep. 30, 2022 | |
Other Liabilities Disclosure [Abstract] | |
OTHER LIABILITIES AND DEFERRED CREDITS | OTHER LIABILITIES AND DEFERRED CREDITS Other liabilities and deferred credits consist of the following (in thousands): September 30, 2022 December 31, 2021 Acquired below market leases, net $ 20,485 $ 22,402 Prepaid rent and deferred revenue 18,618 16,309 Interest rate swap liability — 1,807 Deferred rent expense and lease intangible — 3 Deferred compensation 2,288 2,503 Deferred tax liability 967 967 Straight-line rent liability 13,559 14,274 Lease liability 26,257 27,917 Other liabilities 68 33 Total other liabilities and deferred credits, net $ 82,242 $ 86,215 Straight-line rent liability relates to leases which have rental payments that decrease over time or one-time upfront payments for which the rental revenue is deferred and recognized on a straight-line basis. |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Debt of American Assets Trust, Inc. American Assets Trust, Inc. does not hold any indebtedness. All debt is held directly or indirectly by the Operating Partnership; however, American Assets Trust, Inc. has guaranteed the Operating Partnership's obligations under the (i) amended and restated credit facility, (ii) term loans, (iii) senior guaranteed notes, and (iv) senior unsecured notes. Debt of American Assets Trust, L.P. Secured notes payable The following table is a summary of our total secured notes payable outstanding as of September 30, 2022 and December 31, 2021 (in thousands): Principal Balance as of Stated Interest Rate Stated Maturity Date Description of Debt September 30, 2022 December 31, 2021 as of September 30, 2022 City Center Bellevue (1) — 111,000 3.98 % November 1, 2022 City Center Bellevue (1) $ 75,000 $ — 5.08 % October 1, 2027 75,000 111,000 Debt issuance costs, net of accumulated amortization of $429 and $387, respectively (445) (35) Total Secured Notes Payable Outstanding $ 74,555 $ 110,965 (1) Interest only. On September 16, 2022, the Operating Partnership repaid in full, without premium or penalty, the $111 million principal balance of the mortgage on City Center Bellevue. Concurrent therewith, the Operating Partnership entered into a new $75 million non-recourse mortgage on City Center Bellevue. The new five-year mortgage has a maturity date of October 1, 2027, bears interest at a fixed rate per annum of 5.08% (interest only) and is secured by a first-priority deed of trust on City Center Bellevue and an assignment of all leases, rents and security deposits related to City Center Bellevue. Additionally, the Operating Partnership has provided a carve-out guarantee on the new mortgage at City Center Bellevue. Certain loans require the Operating Partnership to comply with various financial covenants. As of September 30, 2022, the Operating Partnership was in compliance with these financial covenants. Unsecured notes payable The following table is a summary of the Operating Partnership's total unsecured notes payable outstanding as of September 30, 2022 and December 31, 2021 (in thousands): Description of Debt Principal Balance as of Stated Interest Rate Stated Maturity Date September 30, 2022 December 31, 2021 as of September 30, 2022 Term Loan A $ 100,000 $ 100,000 Variable (1) January 5, 2027 Term Loan B 100,000 100,000 Variable (2) March 1, 2023 Term Loan C 50,000 50,000 Variable (3) March 1, 2023 Senior Guaranteed Notes, Series F 100,000 100,000 3.78 % (4) July 19, 2024 Senior Guaranteed Notes, Series B 100,000 100,000 4.45 % February 2, 2025 Senior Guaranteed Notes, Series C 100,000 100,000 4.50 % April 1, 2025 Senior Guaranteed Notes, Series D 250,000 250,000 4.29 % (5) March 1, 2027 Senior Guaranteed Notes, Series E 100,000 100,000 4.24 % (6) May 23, 2029 Senior Guaranteed Notes, Series G 150,000 150,000 3.91 % (7) July 30, 2030 3.375% Senior Unsecured Notes 500,000 500,000 3.38 % February 1, 2031 1,550,000 1,550,000 Debt discount and issuance costs, net of accumulated amortization of $11,242 and $9,462, respectively (11,014) (11,762) Total Unsecured Notes Payable $ 1,538,986 $ 1,538,238 (1) The Operating Partnership has entered into two interest rate swap agreements that are intended to fix the interest rate associated with Term Loan A at approximately 2.70% through its maturity date, subject to adjustments based on our consolidated leverage ratio. (2) The Operating Partnership has entered into an interest rate swap agreement that is intended to fix the interest rate associated with Term Loan B at approximately 3.15% through its maturity date, subject to adjustments based on our consolidated leverage ratio. Effective March 1, 2018, the effective interest rate associated with Term Loan B is approximately 2.65%, subject to adjustments based on our consolidated leverage ratio. (3) The Operating Partnership has entered into an interest rate swap agreement that is intended to fix the interest rate associated with Term Loan C at approximately 3.14% through its maturity date, subject to adjustments based on our consolidated leverage ratio. Effective March 1, 2018, the effective interest rate associated with Term Loan C is approximately 2.64%, subject to adjustments based on our consolidated leverage ratio. (4) The Operating Partnership entered into a treasury lock contract on May 31, 2017, which was settled on June 23, 2017 at a loss of approximately $0.5 million. The treasury lock contract was deemed to be a highly effective cash flow hedge; accordingly, the effective interest rate is approximately 3.85% per annum. (5) The Operating Partnership entered into forward-starting interest rate swap contracts on March 29, 2016 and April 7, 2016, which were settled on January 18, 2017 at a gain of approximately $10.4 million. Each of the forward-starting interest swap rate contracts were deemed to be a highly effective cash flow hedge; accordingly, the effective interest rate is approximately 3.87% per annum. (6) The Operating Partnership entered into a treasury lock contract on April 25, 2017, which was settled on May 11, 2017 at a gain of approximately $0.7 million. The treasury lock contract was deemed to be a highly effective cash flow hedge; accordingly, the effective interest rate is approximately 4.18% per annum. (7) The Operating Partnership entered into a treasury lock contract on June 20, 2019, which was settled on July 17, 2019 at a gain of approximately $0.5 million. The treasury lock contract was deemed to be a highly effective cash flow hedge; accordingly, the effective interest rate is approximately 3.88% per annum. On January 26, 2021, the Operating Partnership issued $500 million of senior unsecured notes (the "3.375% Senior Notes") that mature February 1, 2031 and bear interest at 3.375% per annum. The 3.375% Senior Notes were priced at 98.935% of the principal amount with a yield to maturity of 3.502%. The net proceeds of the 3.375% Senior Notes, after the issuance discount, underwriting fees, and other costs were approximately $489.7 million, which were primarily used to (i) prepay our $150 million Senior Guaranteed Notes, Series A, with a make-whole payment (as defined in the Note Purchase Agreement for the Series A Notes) thereon of approximately $3.9 million, on January 26, 2021, (ii) repay our $100 million then outstanding balance under our Revolver Loan on January 26, 2021, (iii) fund the development of the La Jolla Commons III office building and (iv) for general corporate purposes. Certain unsecured loans and notes require the Operating Partnership to comply with various financial covenants. As of September 30, 2022, the Operating Partnership was in compliance with these financial covenants. Amended Term Loan Agreement On January 9, 2018, we entered into the Third Amendment to the Term Loan Agreement (as so amended, the "Term Loan Agreement"), which maintains the seven years $150 million unsecured term loan (referred to herein as Term Loan B and Term Loan C) to the Operating Partnership that matures on March 1, 2023 (the “$150mm Term Loan”). Effective as of March 1, 2018, borrowings under the Term Loan Agreement with respect to the $150mm Term Loan bear interest at floating rates equal to, at the Operating Partnership’s option, either (1) LIBOR, plus a spread which ranges from 1.20% to 1.70% based on the Operating Partnership’s consolidated leverage ratio, or (2) a base rate equal to the highest of (a) 0%, (b) the prime rate, (c) the federal funds rate plus 50 bps or (d) the Eurodollar rate plus 100 bps, in each case plus a spread which ranges from 0.70% to 1.35% based on the Operating Partnership’s consolidated leverage ratio. Additionally, the Operating Partnership may elect for borrowings to bear interest based on a ratings-based pricing grid as per the Operating Partnership’s then-applicable investment grade debt ratings under the terms set forth in the Term Loan Agreement. Third Amended and Restated Credit Facility On January 9, 2018, we entered into a second amended and restated credit agreement (the "Second Amended and Restated Credit Facility"). The Second Amended and Restated Credit Facility provides for aggregate, unsecured borrowing of $450 million, consisting of a revolving line of credit of $350 million (the "Revolver Loan") and a term loan of $100 million (the "Term Loan A"). The Second Amended and Restated Credit Facility had an accordion feature that allowed us to increase the availability thereunder up to an additional $250 million, subject to meeting specified requirements and obtaining additional commitments from lenders. Borrowings under the Second Amended and Restated Credit Agreement initially bore interest at floating rates equal to, at our option, either (1) LIBOR, plus a spread which ranges from (a) 1.05% to 1.50% (with respect to the Revolver Loan) and (b) 1.30% to 1.90% (with respect to Term Loan A), in each case based on our consolidated leverage ratio, or (2) a base rate equal to the highest of (a) the prime rate, (b) the federal funds rate plus 50 bps or (c) LIBOR plus 100 bps, plus a spread which ranges from (i) 0.10% to 0.50% (with respect to the Revolver Loan) and (ii) 0.30% to 0.90% (with respect to Term Loan A), in each case based on our consolidated leverage ratio. On January 9, 2019, we entered into the first amendment (“First Amendment”) to the Second Amended and Restated Credit Facility, which extended the maturity date of Term Loan A to January 9, 2021, subject to three, one year extension options. In October 2020, we exercised an option to extend the maturity date of Term Loan A to January 9, 2022, subject to certain conditions. Additionally, in connection with the First Amendment, borrowings under the Second Amended and Restated Credit Facility with respect to Term Loan A bore interest at floating rates equal to, at our option, either (1) LIBOR, plus a spread which ranges from 1.20% to 1.70% based on our consolidated total leverage ratio, or (2) a base rate equal to the highest of (a) the prime rate, (b) the federal funds rate plus 50 bps or (c) the Eurodollar rate plus 100 bps, in each case plus a spread which ranges from 0.20% to 0.70% based on our consolidated total leverage ratio. The foregoing rates were intended to be more favorable than previously contained in the Second Amended and Restated Credit Facility (prior to entry into the First Amendment) with respect to Term Loan A. On January 5, 2022, we entered into the Third Amended and Restated Credit Facility, which provides for aggregate, unsecured borrowings of up to $500 million, consisting of a revolving line of credit of $400 million (the “2022 Revolver Loan”) and a term loan of $100 million (the “2022 Term Loan A”). The 2022 Revolver Loan initially matures on January 5, 2026, subject to two, six-month extension options. The 2022 Term Loan A matures on January 5, 2027, with no further extension options. Borrowings under the Third Amended and Restated Credit Agreement bear interest at floating rates equal to, at the Operating Partnership’s option, either (1) the applicable Secured Overnight Financing Rate (“SOFR”), plus the applicable SOFR Adjustment, and a spread which ranges from (a) 1.05% to 1.50% (with respect to the 2022 Revolver Loans) and (b) 1.20% to 1.70% (with respect to the 2022 Term Loan A), in each case based on our consolidated leverage ratio, or (2) a base rate equal to the highest of (a) the prime rate, (b) the federal funds rate plus 50 bps, (c) the Term SOFR Screen Rate with a term of one month plus 100 bps and (d) 1.00%, plus a spread which ranges from (i) 0.10% to 0.50% (with respect to the 2022 Revolver Loan) and (ii) 0.20% to 0.70% (with respect to the 2022 Term Loan A), in each case based on our consolidated leverage ratio. On January 14, 2022, the Operating Partnership entered into two interest rate swap agreements that are intended to fix the interest rate associated with the 2022 Term Loan A at approximately 2.70% through January 5, 2027, subject to adjustments based on our consolidated leverage ratio. At September 30, 2022, there was $36 million outstanding under the 2022 Revolver Loan. Approximately $2.1 million of net debt issuance costs are included in the unsecured line of credit, net on the balance sheet. For the nine months ended September 30, 2022, the weighted average interest rate on the 2022 Revolver Loan was 2.26% Additionally, the Third Amended and Restated Credit Facility includes a number of customary financial covenants, including: • A maximum leverage ratio (defined as total indebtedness net of certain cash and cash equivalents to total asset value) of 60%; • A maximum secured leverage ratio (defined as total secured debt to secured total asset value) of 40%; • A minimum fixed charge coverage ratio (defined as consolidated earnings before interest, taxes, depreciation and amortization to consolidated fixed charges) of 1.50x; • A minimum unsecured interest coverage ratio of 1.75x; • A maximum unsecured leverage ratio of 60%; and • Recourse indebtedness at any time cannot exceed 15% of total asset value. The Third Amended and Restated Credit Facility provides that our annual distributions may not exceed the greater of (1) 95% of our funds from operation ("FFO") or (2) the amount required for us to (a) qualify and maintain our REIT status and (b) avoid the payment of federal or state income or excise tax. If certain events of default exist or would result from a distribution, we may be precluded from making distributions other than those necessary to qualify and maintain our status as a REIT. As of September 30, 2022, the Operating Partnership was in compliance with the financial covenants in the Third Amended and Restated Credit Facility. |
PARTNERS' CAPITAL OF AMERICAN A
PARTNERS' CAPITAL OF AMERICAN ASSETS TRUST, L.P. | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
PARTNERS' CAPITAL OF AMERICAN ASSETS TRUST, L.P. | PARTNERS' CAPITAL OF AMERICAN ASSETS TRUST, L.P. Noncontrolling interests in our Operating Partnership are interests in the Operating Partnership that are not owned by us. Noncontrolling interests consisted of 16,181,537 common units (the “noncontrolling common units”), and represented approximately 21.2% of the ownership interests in our Operating Partnership at September 30, 2022. Common units and shares of our common stock have essentially the same economic characteristics in that common units and shares of our common stock share equally in the total net income or loss distributions of our Operating Partnership. Investors who own common units have the right to cause our Operating Partnership to redeem any or all of their common units for cash equal to the then-current market value of one share of our common stock, or, at our election, shares of our common stock on a one-for-one basis. During the nine months ended September 30, 2022, no common units were converted into shares of our common stock. Earnings Per Unit of the Operating Partnership Basic earnings per unit (“EPU”) of the Operating Partnership is computed by dividing income applicable to unitholders by the weighted average Operating Partnership units outstanding, as adjusted for the effect of participating securities. Operating Partnership units granted in equity-based payment transactions that have non-forfeitable dividend equivalent rights are considered participating securities prior to vesting. The impact of unvested Operating Partnership unit awards on EPU has been calculated using the two-class method whereby earnings are allocated to the unvested Operating Partnership unit awards based on distributions and the unvested Operating Partnership units’ participation rights in undistributed earnings. The calculation of diluted EPU for the three months ended September 30, 2022 and 2021 does not include the weighted average of 483,110 and 481,966 unvested outstanding Operating Partnership units, respectively, as these equity securities are either considered contingently issuable or the effect of including these equity securities was anti-dilutive to income from continuing operations and net income attributable to the unitholders. The calculation of diluted EPU for the nine months ended September 30, 2022 and 2021 does not include the weighted average of 483,895 and 485,897 unvested Operating Partnership units, respectively, as these equity securities are either considered contingently issuable or the effect of including these equity securities was anti-dilutive to income from continuing operations and net income attributable to the unitholders. |
EQUITY OF AMERICAN ASSETS TRUST
EQUITY OF AMERICAN ASSETS TRUST, INC. | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
EQUITY OF AMERICAN ASSETS TRUST, INC. | EQUITY OF AMERICAN ASSETS TRUST, INC. Stockholders' Equity On December 3, 2021, we entered into an at-the-market ("ATM") equity program with five sales agents in which we may, from time to time, offer and sell shares of our common stock having an aggregate offering price of up to $250 million. The sales of shares of our common stock made through the ATM equity program, as amended, are made in "at-the-market" offerings as defined in Rule 415 of the Securities Act of 1933, as amended. For the nine months ended September 30, 2022, no shares of common stock were sold through the ATM equity program. We intend to use the net proceeds from the ATM equity program to fund our development or redevelopment activities, repay amounts outstanding from time to time under our revolving line of credit or other debt financing obligations, fund potential acquisition opportunities and/or for general corporate purposes. As of September 30, 2022, we had the capacity to issue up to $250 million in shares of our common stock under our current ATM equity program. Actual future sales will depend on a variety of factors including, but not limited to, market conditions, the trading price of our common stock and our capital needs. As of September 30, 2022, we have no obligation to sell the remaining shares available for sale under the ATM equity program. Dividends The following table lists the dividends declared and paid on our shares of common stock and noncontrolling common units during the nine months ended September 30, 2022: Period Amount per Period Covered Dividend Paid Date First Quarter 2022 $ 0.32 January 1, 2022 to March 31, 2022 March 24, 2022 Second Quarter 2022 $ 0.32 April 1, 2022 to June 30, 2022 June 23, 2022 Third Quarter 2022 $ 0.32 July 1, 2022 to September 30, 2022 September 22, 2022 Taxability of Dividends Earnings and profits, which determine the taxability of distributions to stockholders and holders of common units, may differ from income reported for financial reporting purposes due to the differences for federal income tax purposes in the treatment of revenue recognition and compensation expense and in the basis of depreciable assets and estimated useful lives used to compute depreciation. Stock-Based Compensation We follow the FASB guidance related to stock-based compensation which establishes financial accounting and reporting standards for stock-based employee compensation plans, including all arrangements by which employees receive shares of stock or other equity instruments of the employer. The guidance also defines a fair value-based method of accounting for an employee stock award or similar equity instrument. The following table summarizes the activity of restricted stock awards during the nine months ended September 30, 2022: Units Weighted Average Grant Date Fair Value Nonvested at January 1, 2022 487,397 $ 23.78 Granted 6,072 32.94 Vested (6,350) 35.66 Forfeited (3,121) 23.18 Nonvested at September 30, 2022 483,998 $ 23.74 We recognize noncash compensation expense ratably over the vesting period, and accordingly, we recognized $2.0 million and $1.5 million in noncash compensation expense for the three months ended September 30, 2022 and 2021, respectively, which is included in general and administrative expenses on the consolidated statements of comprehensive income. We recognized $5.5 million and $4.5 million in noncash compensation expense for the nine months ended September 30, 2022 and 2021, respectively. Unrecognized compensation expense was $5.2 million at September 30, 2022. Earnings Per Share We have calculated earnings per share (“EPS”) under the two-class method. The two-class method is an earnings allocation methodology whereby EPS for each class of common stock and participating security is calculated according to dividends declared and participation rights in undistributed earnings. The weighted average unvested shares outstanding, which are considered participating securities, were 483,110 and 481,966 for the three months ended September 30, 2022 and 2021, respectively, and 483,895 and 485,897 for the nine months ended September 30, 2022 and 2021, respectively. Therefore, we have allocated our earnings for basic and diluted EPS between common shares and unvested shares as these unvested shares have nonforfeitable dividend equivalent rights. Diluted EPS is calculated by dividing the net income applicable to common stockholders for the period by the weighted average number of common and dilutive instruments outstanding during the period using the treasury stock method. For the three and nine months ended September 30, 2022 and 2021, diluted shares exclude incentive restricted stock as these awards are considered contingently issuable. Additionally, the unvested restricted stock awards subject to time vesting are anti-dilutive for all periods presented, and accordingly, have been excluded from the weighted average common shares used to compute diluted EPS. The computation of basic and diluted EPS is presented below (dollars in thousands, except share and per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 NUMERATOR Net income $ 16,369 $ 12,895 $ 43,471 $ 26,115 Less: Net income attributable to restricted shares (155) (145) (464) (417) Less: Income from operations attributable to unitholders in the Operating Partnership (3,442) (2,709) (9,130) (5,459) Net income attributable to common stockholders—basic $ 12,772 $ 10,041 $ 33,877 $ 20,239 Income from operations attributable to American Assets Trust, Inc. common stockholders—basic $ 12,772 $ 10,041 $ 33,877 $ 20,239 Plus: Income from operations attributable to unitholders in the Operating Partnership 3,442 2,709 9,130 5,459 Net income attributable to common stockholders—diluted $ 16,214 $ 12,750 $ 43,007 $ 25,698 DENOMINATOR Weighted average common shares outstanding—basic 60,044,117 59,990,343 60,041,034 59,986,844 Effect of dilutive securities—conversion of Operating Partnership units 16,181,537 16,181,537 16,181,537 16,181,537 Weighted average common shares outstanding—diluted 76,225,654 76,171,880 76,222,571 76,168,381 Earnings per common share, basic $ 0.21 $ 0.17 $ 0.56 $ 0.34 Earnings per common share, diluted $ 0.21 $ 0.17 $ 0.56 $ 0.34 |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXESWe elected to be taxed as a REIT and operate in a manner that allows us to qualify as a REIT for federal income tax purposes commencing with our initial taxable year. As a REIT, we are generally not subject to corporate level income tax on the earnings distributed currently to our stockholders that we derive from our REIT qualifying activities. Taxable income from non-REIT activities managed through our TRS is subject to federal and state income taxes. We lease our hotel property to a wholly owned TRS that is subject to federal and state income taxes. We account for income taxes using the asset and liability method, under which deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between GAAP carrying amounts and their respective tax bases. Additionally, we classify certain state taxes as income taxes for financial reporting purposes in accordance with ASC Topic 740, Income Taxes . A deferred tax liability is included in the other liabilities and deferred credits, net on our consolidated balance sheets of $1.0 million and $1.0 million as of September 30, 2022 and December 31, 2021, respectively, in relation to real estate asset basis differences of property subject to state taxes based on income and certain prepaid expenses of our TRS. Income tax expense is recorded in other (expense) income, net on our consolidated statements of comprehensive income. For the three and nine months ended September 30, 2022, we recorded income tax expense of $0.2 million and $0.6 million. For the three and nine months ended September 30, 2021, we recorded income tax expense of $0.2 million and $0.5 million. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Legal We are sometimes involved in various disputes, lawsuits, warranty claims, environmental, and other matters arising in the ordinary course of business. Management makes assumptions and estimates concerning the likelihood and amount of any potential loss relating to these matters. We are currently a party to various legal proceedings. We accrue a liability for litigation if an unfavorable outcome is probable and the amount of loss can be reasonably estimated. If an unfavorable outcome is probable and a reasonable estimate of the loss is a range, we accrue the best estimate within the range; however, if no amount within the range is a better estimate than any other amount, the minimum within the range is accrued. Legal fees related to litigation are expensed as incurred. We do not believe that the ultimate outcome of these matters, either individually or in the aggregate, could have a material adverse effect on our financial position or overall trends in results of operations; however, litigation is subject to inherent uncertainties. Also, under our leases, tenants are typically obligated to indemnify us from and against all liabilities, costs and expenses imposed upon or asserted against us as owner of the properties due to certain matters relating to the operation of the properties by the tenant. Commitments See Footnote 13 for description of our leases, as a lessee. We have management agreements with Outrigger Hotels & Resorts or an affiliate thereof (“Outrigger”) pursuant to which Outrigger manages each of the retail and hotel portions of the Waikiki Beach Walk property. Under the management agreement with Outrigger relating to the retail portion of Waikiki Beach Walk (the “retail management agreement”), we pay Outrigger a monthly management fee of 3.0% of net revenues from the retail portion of Waikiki Beach Walk. Pursuant to the terms of the retail management agreement, if the agreement is terminated in certain instances, including our election not to repair damage or destruction at the property, a condemnation or our failure to make required working capital infusions, we would be obligated to pay Outrigger a termination fee equal to the sum of the management fees paid for the two months immediately preceding the termination date. The retail management agreement may not be terminated by us or by Outrigger without cause. Under our management agreement with Outrigger relating to the hotel portion of Waikiki Beach Walk (the “hotel management agreement”), we pay Outrigger a monthly management fee of 6.0% of the hotel's gross operating profit, as well as 3.0% of the hotel's gross revenues; provided that the aggregate management fee payable to Outrigger for any year shall not exceed 3.5% of the hotel's gross revenues for such fiscal year. Pursuant to the terms of the hotel management agreement, if the agreement is terminated in certain instances, including upon a transfer by us of the hotel or upon a default by us under the hotel management agreement, we would be required to pay a cancellation fee calculated by multiplying (1) the management fees for the previous 12 months by (2) (a) eight, if the agreement is terminated in the first 11 years of its term, or (b) four, three, two or one, if the agreement is terminated in the twelfth, thirteenth, fourteenth or fifteenth year, respectively, of its term. The hotel management agreement may not be terminated by us or by Outrigger without cause. Additionally, we have a management agreement with Outrigger pursuant to which Outrigger manages our Waikele Center and Shops at Kalakaua. In connection with such management agreement, we pay Outrigger a fixed management fee of $12,000 per month in the aggregate plus additional amounts for any lease renewal services provided by Outrigger at our request. This management agreement can be terminated by us at any time and for any reason on 30 days' notice without any cancellation or termination fees. A wholly owned subsidiary of our Operating Partnership, WBW Hotel Lessee LLC, entered into a franchise license agreement with Embassy Suites Franchise LLC, the franchisor of the brand “Embassy Suites™,” to obtain the non-exclusive right to operate the hotel under the Embassy Suites TM brand for 20 years. The franchise license agreement provides that WBW Hotel Lessee LLC must comply with certain management, operational, record keeping, accounting, reporting and marketing standards and procedures. In connection with this agreement, we are also subject to the terms of a product improvement plan pursuant to which we expect to undertake certain actions to ensure that our hotel's infrastructure is maintained in compliance with the franchisor's brand standards. In addition, we must pay to Embassy Suites Franchise LLC a monthly franchise royalty fee equal to 4.0% of the hotel's gross room revenue through December 2022 and 5.0% of the hotel's gross room revenue thereafter, as well as a monthly program fee equal to 4.0% of the hotel's gross room revenue. If the franchise license is terminated due to our failure to make required improvements or to otherwise comply with its terms, we may be liable to the franchisor for a termination payment, which could be as high as $5.4 million based on operating performance through September 30, 2022. Our Del Monte Center property has ongoing environmental remediation related to ground water contamination. The environmental issue existed at purchase and remains in remediation. The final stages of the remediation will include routine, long term ground monitoring by the appropriate regulatory agency over the next five years to seven years. The work performed is financed through an escrow account funded by the seller upon purchase of the Del Monte Center. We believe the funds in the escrow account are sufficient for the remaining work to be performed. However, if further work is required costing more than the remaining escrow funds, we could be required to pay such overage, although we may have a contractual claim for such costs against the prior owner or our environmental remediation consultant. Concentrations of Credit Risk Our properties are located in Southern California, Northern California, Washington, Oregon, Texas and Hawaii. The ability of the tenants to honor the terms of their respective leases is dependent upon the economic, regulatory, social, and health factors affecting the markets in which the tenants operate including, without limitation, the impact the COVID-19 pandemic has had on our tenants. Fifteen of our consolidated properties are located in Southern California, which exposes us to greater economic risks than if we owned a more geographically diverse portfolio. Tenants in the retail industry accounted for 23.6% of total revenues for the nine months ended September 30, 2022. This makes us susceptible to demand for retail rental space and subject to the risks associated with an investment in real estate with a concentration of tenants in the retail industry. Furthermore, tenants in the office industry accounted for 48.4% of total revenues for the nine months ended September 30, 2022. This makes us susceptible to demand for office rental space and subject to the risks associated with an investment in real estate with a concentration of tenants in the office industry. For the nine months ended September 30, 2022 and 2021, no tenant accounted for more than 10% of our total rental revenue. |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
LEASES | LEASES Lessor Operating Leases We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases. Our leases with office, retail, mixed-use and residential tenants are classified as operating leases. Leases at our office and retail properties and the retail portion of our mixed-use property generally range from three years to ten years (certain leases with anchor tenants may be longer), and in addition to minimum rents, usually provide for cost recoveries for the tenant’s share of certain operating costs. Our leases may also include variable lease payments in the form of percentage rents based on the tenant’s level of sales achieved in excess of a breakpoint threshold. Leases on apartments generally range from 7 to 15 months, with a majority having 12-month lease terms. Rooms at the hotel portion of our mixed-use property are rented on a nightly basis. Leases at our office and retail properties and the retail portion of our mixed-use property may contain lease extension options, at our lessee's discretion. The extension options are generally for 3 to 10 years and contain primarily rent at fixed rates or the prevailing market rent. The extension options are generally exercisable 6 to 12 months prior to the expiration of the lease and require the lessee to not be in default of the lease terms. We attempt to maximize the amount we expect to derive from the underlying real estate property following the end of a lease, to the extent it is not extended. We maintain a proactive leasing and capital improvement program that, combined with the quality and locations of our properties, has made our properties attractive to tenants. However, the residual value of a real estate property is still subject to various market-specific, asset-specific, and tenant-specific risks and characteristics. As of September 30, 2022, minimum future rentals from noncancelable operating leases, before any reserve for uncollectible amounts and assuming no early lease terminations, at our office and retail properties and the retail portion of our mixed-use property are as follows (in thousands): Year Ending December 31, 2022 (three months ending December 31, 2022) $ 56,119 2023 245,888 2024 219,526 2025 195,478 2026 179,796 Thereafter 440,435 Total $ 1,337,242 The above future minimum rentals exclude residential leases, which typically have a term of 12 months or less, and exclude the hotel, as rooms are rented on a nightly basis. Lessee Operating Leases We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases. At The Landmark at One Market, we lease, as lessee, a building adjacent to The Landmark at One Market under an operating lease effective through June 30, 2026, which we have the option to extend until 2031 by way of the remaining five years extension option (the "Annex Lease"). The lease payments under the extension option provided for under the Annex Lease will be equal to the fair rental value at the time the extension option is exercised. The extension option is included in the calculation of the right-of-use asset and lease liability as we are reasonably certain of exercising the extension option. Our lease agreements do not contain any residual value guarantees or material restrictive covenants. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement in determining the present value of lease payments. Current annual payments under the operating leases are as follows, as of September 30, 2022 (in thousands): Year Ending December 31, 2022 (three months ending December 31, 2022) $ 820 2023 3,328 2024 3,428 2025 3,531 2026 3,584 Thereafter 16,126 Total lease payments 30,817 Imputed interest (4,560) Present value of lease liability $ 26,257 Lease costs under the operating leases are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Operating lease cost $ 844 $ 831 $ 2,533 $ 3,095 Sublease income (968) (745) (2,675) (2,877) Total lease (income) cost $ (124) $ 86 $ (142) $ 218 Weighted-average remaining lease term - operating leases (in years) 8.8 Weighted-average discount rate - operating leases 3.19 % Supplemental cash flow information and non-cash activity related to our operating leases are as follow (in thousands): Nine Months Ended September 30, 2022 2021 Operating cash flow information: Cash paid for amounts included in the measurement of lease liabilities $ 2,412 $ 1,996 Subleases |
LEASES | LEASES Lessor Operating Leases We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases. Our leases with office, retail, mixed-use and residential tenants are classified as operating leases. Leases at our office and retail properties and the retail portion of our mixed-use property generally range from three years to ten years (certain leases with anchor tenants may be longer), and in addition to minimum rents, usually provide for cost recoveries for the tenant’s share of certain operating costs. Our leases may also include variable lease payments in the form of percentage rents based on the tenant’s level of sales achieved in excess of a breakpoint threshold. Leases on apartments generally range from 7 to 15 months, with a majority having 12-month lease terms. Rooms at the hotel portion of our mixed-use property are rented on a nightly basis. Leases at our office and retail properties and the retail portion of our mixed-use property may contain lease extension options, at our lessee's discretion. The extension options are generally for 3 to 10 years and contain primarily rent at fixed rates or the prevailing market rent. The extension options are generally exercisable 6 to 12 months prior to the expiration of the lease and require the lessee to not be in default of the lease terms. We attempt to maximize the amount we expect to derive from the underlying real estate property following the end of a lease, to the extent it is not extended. We maintain a proactive leasing and capital improvement program that, combined with the quality and locations of our properties, has made our properties attractive to tenants. However, the residual value of a real estate property is still subject to various market-specific, asset-specific, and tenant-specific risks and characteristics. As of September 30, 2022, minimum future rentals from noncancelable operating leases, before any reserve for uncollectible amounts and assuming no early lease terminations, at our office and retail properties and the retail portion of our mixed-use property are as follows (in thousands): Year Ending December 31, 2022 (three months ending December 31, 2022) $ 56,119 2023 245,888 2024 219,526 2025 195,478 2026 179,796 Thereafter 440,435 Total $ 1,337,242 The above future minimum rentals exclude residential leases, which typically have a term of 12 months or less, and exclude the hotel, as rooms are rented on a nightly basis. Lessee Operating Leases We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases. At The Landmark at One Market, we lease, as lessee, a building adjacent to The Landmark at One Market under an operating lease effective through June 30, 2026, which we have the option to extend until 2031 by way of the remaining five years extension option (the "Annex Lease"). The lease payments under the extension option provided for under the Annex Lease will be equal to the fair rental value at the time the extension option is exercised. The extension option is included in the calculation of the right-of-use asset and lease liability as we are reasonably certain of exercising the extension option. Our lease agreements do not contain any residual value guarantees or material restrictive covenants. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement in determining the present value of lease payments. Current annual payments under the operating leases are as follows, as of September 30, 2022 (in thousands): Year Ending December 31, 2022 (three months ending December 31, 2022) $ 820 2023 3,328 2024 3,428 2025 3,531 2026 3,584 Thereafter 16,126 Total lease payments 30,817 Imputed interest (4,560) Present value of lease liability $ 26,257 Lease costs under the operating leases are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Operating lease cost $ 844 $ 831 $ 2,533 $ 3,095 Sublease income (968) (745) (2,675) (2,877) Total lease (income) cost $ (124) $ 86 $ (142) $ 218 Weighted-average remaining lease term - operating leases (in years) 8.8 Weighted-average discount rate - operating leases 3.19 % Supplemental cash flow information and non-cash activity related to our operating leases are as follow (in thousands): Nine Months Ended September 30, 2022 2021 Operating cash flow information: Cash paid for amounts included in the measurement of lease liabilities $ 2,412 $ 1,996 Subleases |
COMPONENTS OF RENTAL INCOME AND
COMPONENTS OF RENTAL INCOME AND EXPENSE | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
COMPONENTS OF RENTAL INCOME AND EXPENSE | COMPONENTS OF RENTAL INCOME AND EXPENSE The principal components of rental income are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Lease rental income Office $ 51,637 $ 45,855 $ 148,636 $ 132,229 Retail 24,310 23,438 71,637 65,866 Multifamily 13,539 12,169 39,622 35,684 Mixed-use 2,960 2,618 8,574 6,851 Percentage rent 978 969 2,216 2,593 Hotel revenue 11,379 8,164 28,848 17,626 Other 665 591 1,937 1,724 Total rental income $ 105,468 $ 93,804 $ 301,470 $ 262,573 Lease rental income includes $2.5 million and $3.8 million for the three months ended September 30, 2022 and 2021, respectively, and $6.3 million and $10.8 million for the nine months ended September 30, 2022 and 2021, respectively, to recognize lease rental income on a straight-line basis. In addition, net amortization of above and below market leases included in lease rental income was $0.8 million and $0.8 million for the three months ended September 30, 2022 and 2021, respectively, and $2.5 million and $2.4 million for the nine months ended September 30, 2022 and 2021, respectively. The principal components of rental expenses are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Rental operating $ 12,272 $ 11,014 $ 34,795 $ 30,165 Hotel operating 7,230 5,429 19,352 12,287 Repairs and maintenance 5,799 4,492 15,868 12,263 Marketing 489 470 1,477 1,174 Rent 815 856 2,405 3,166 Hawaii excise tax 1,231 794 2,963 1,960 Management fees 602 411 1,576 901 Total rental expenses $ 28,438 $ 23,466 $ 78,436 $ 61,916 |
OTHER (EXPENSE) INCOME, NET
OTHER (EXPENSE) INCOME, NET | 9 Months Ended |
Sep. 30, 2022 | |
Other Income and Expenses [Abstract] | |
OTHER (EXPENSE) INCOME, NET | OTHER (EXPENSE) INCOME, NET The principal components of other expense, net, are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Interest and investment income $ 60 $ 98 $ 117 $ 272 Income tax expense (240) (150) (640) (451) Total other (expense) income, net $ (180) $ (52) $ (523) $ (179) |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS During the first quarter of 2019, we terminated a lease agreement with American Assets, Inc. ("AAI"), an entity owned and controlled by Ernest Rady, our Chief Executive Officer and Chairman of the Board, and entered into a new lease agreement with AAI for office space at Torrey Reserve Campus. Rents commenced on March 1, 2019 for an initial lease term of three years at an average annual rental rate of $0.2 million. During the third quarter of 2020, we entered into a new lease with AAI for office space at Torrey Point to replace its existing lease at Torrey Reserve Campus. Rents commenced on March 1, 2021 for an initial lease term of ten years at an average annual rental rate of $0.2 million. Rental revenue recognized on the AAI leases of $0.2 million and $0.2 million for the nine months ended September 30, 2022 and 2021, respectively, is included in rental income on the statements of comprehensive income. On occasion. the company utilizes aircraft services provided by AAI Aviation, Inc. ("AAIA"), an entity owned and controlled by Mr. Rady. For the nine months ended September 30, 2022 and 2021, we incurred approximately $0.2 million and $0.2 million of expenses, respectively, related to aircraft services of AAIA or reimbursement to Mr. Rady (or his trust) for use of the aircraft owned by AAIA. These expenses are recorded as general and administrative expenses in our consolidated statements of comprehensive income. The Waikiki Beach Walk entities have a 47.7% investment in WBW CHP LLC, an entity that was formed to, among other things, construct a chilled water plant to provide air conditioning to the property and other adjacent facilities. The operating expenses of WBW CHP LLC are recovered through reimbursements from its members, and reimbursements to WBW CHP LLC of $0.9 million and $0.8 million for the nine months ended September 30, 2022 and 2021, respectively, are included in rental expenses on the consolidated statements of comprehensive income. |
SEGMENT REPORTING
SEGMENT REPORTING | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | SEGMENT REPORTING Segment information is prepared on the same basis that our management reviews information for operational decision-making purposes. We operate in four business segments: the acquisition, redevelopment, ownership and management of office real estate, retail real estate, multifamily real estate and mixed-use real estate. The products for our office segment primarily include rental of office space and other tenant services, including tenant reimbursements, parking and storage space rental. The products for our retail segment primarily include rental of retail space and other tenant services, including tenant reimbursements, parking and storage space rental. The products for our multifamily segment include rental of apartments and other tenant services. The products of our mixed-use segment include rental of retail space and other tenant services, including tenant reimbursements, parking and storage space rental and operation of a 369-room all-suite hotel. We evaluate the performance of our segments based on segment profit, which is defined as property revenue less property expenses. We do not use asset information as a measure to assess performance and make decisions to allocate resources. Therefore, depreciation and amortization expense is not allocated among segments. General and administrative expenses, interest expense, depreciation and amortization expense and other income and expense are not included in segment profit as our internal reporting addresses these items on a corporate level. Segment profit is not a measure of operating income or cash flows from operating activities as measured by GAAP, and it is not indicative of cash available to fund cash needs and should not be considered an alternative to cash flows as a measure of liquidity. Not all companies calculate segment profit in the same manner. We consider segment profit to be an appropriate supplemental measure to net income because it assists both investors and management in understanding the core operations of our properties. The following table represents operating activity within our reportable segments (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Total Office Property revenue $ 53,250 $ 47,433 $ 153,412 $ 136,467 Property expense (14,551) (13,016) (41,944) (36,029) Segment profit 38,699 34,417 111,468 100,438 Total Retail Property revenue 25,694 24,541 74,873 69,296 Property expense (7,807) (5,745) (22,965) (19,922) Segment profit 17,887 18,796 51,908 49,374 Total Multifamily Property revenue 14,748 13,085 42,851 38,376 Property expense (6,871) (6,213) (19,171) (17,197) Segment profit 7,877 6,872 23,680 21,179 Total Mixed-Use Property revenue 17,331 13,227 45,512 29,942 Property expense (10,686) (8,136) (28,549) (20,378) Segment profit 6,645 5,091 16,963 9,564 Total segments’ profit $ 71,108 $ 65,176 $ 204,019 $ 180,555 The following table is a reconciliation of segment profit to net income attributable to stockholders (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Total segments’ profit $ 71,108 $ 65,176 $ 204,019 $ 180,555 General and administrative (8,376) (6,827) (23,130) (20,574) Depreciation and amortization (31,729) (30,680) (93,228) (85,827) Interest expense (14,454) (14,722) (43,667) (43,589) Loss on early extinguishment of debt — — — (4,271) Other income (expense), net (180) (52) (523) (179) Net income 16,369 12,895 43,471 26,115 Net income attributable to restricted shares (155) (145) (464) (417) Net income attributable to unitholders in the Operating Partnership (3,442) (2,709) (9,130) (5,459) Net income attributable to American Assets Trust, Inc. stockholders $ 12,772 $ 10,041 $ 33,877 $ 20,239 The following table shows net real estate and secured note payable balances for each of the segments (in thousands): September 30, 2022 December 31, 2021 Net Real Estate Office $ 1,610,640 $ 1,536,212 Retail 582,727 591,107 Multifamily 373,037 381,315 Mixed-Use 169,380 173,347 $ 2,735,784 $ 2,681,981 Secured Notes Payable (1) Office $ 75,000 $ 111,000 $ 75,000 $ 111,000 (1) Excludes debt issuance costs of $0.45 million and $0.04 million for each of the periods ended September 30, 2022 and December 31, 2021, respectively. Capital expenditures for each segment for the three and nine months ended September 30, 2022 and 2021 were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Capital Expenditures (1) Office $ 24,107 $ 17,601 $ 80,824 $ 48,471 Retail 2,165 1,317 9,422 4,817 Multifamily 686 2,121 3,572 4,117 Mixed-Use 197 704 649 1,392 $ 27,155 $ 21,743 $ 94,467 $ 58,797 (1) Capital expenditures represent cash paid for capital expenditures during the period and include leasing commissions paid. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation Our consolidated financial statements include the accounts of the Company, our Operating Partnership and our subsidiaries. The equity interests of other investors in our Operating Partnership are reflected as noncontrolling interests. The Company follows the Financial Accounting Standards Board (the "FASB") guidance for determining whether an entity is a variable interest entity (“VIE”) and requires the performance of a qualitative rather than a quantitative analysis to determine the primary beneficiary of a VIE. Under this guidance, an entity would be required to consolidate a VIE if it has (i) the power to direct the activities that most significantly impact the entity’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could be significant to the VIE. American Assets Trust, Inc. has concluded that the Operating Partnership is a VIE, and because American Assets Trust, Inc. has both the power and the rights to control the Operating Partnership, American Assets Trust, Inc. is the primary beneficiary and is required to continue to consolidate the Operating Partnership. Substantially all of the assets and liabilities of the Company are related to the operating partnership VIE. All intercompany transactions and balances are eliminated in consolidation. The accompanying consolidated financial statements of the Company and the Operating Partnership have been prepared in accordance with the rules applicable to Form 10-Q and include all information and footnotes required for interim financial statement presentation, but do not include all disclosures required under accounting principles generally accepted in the United States (“GAAP”) for annual financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments, except as otherwise noted) considered necessary for a fair presentation have been included. These financial statements should be read in conjunction with the audited consolidated financial statements and notes therein included in the Company's and Operating Partnership's annual report on Form 10-K for the year ended December 31, 2021. The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that in certain circumstances affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and revenues and expenses. These estimates are prepared using our best judgment, after considering past, current and expected events and economic conditions. Actual results could differ from these estimates. |
Significant Accounting Policies | Significant Accounting PoliciesWe describe our significant accounting policies in Note 1 to the consolidated financial statements in Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2021. There have been no changes to our significant accounting policies during the nine months ended September 30, 2022. |
Segment Information | Segment InformationSegment information is prepared on the same basis that our chief operating decision maker reviews information for operational decision-making purposes. We operate in four business segments: the acquisition, redevelopment, ownership and management of office real estate, retail real estate, multifamily real estate and mixed-use real estate. The products for our office segment primarily include rental of office space and other tenant services, including tenant reimbursements, parking and storage space rental. The products for our retail segment primarily include rental of retail space and other tenant services, including tenant reimbursements, parking and storage space rental. The products for our multifamily segment include rental of apartments and other tenant services. The products of our mixed-use segment include rental of retail space and other tenant services, including tenant reimbursements, parking and storage space rental and operation of a 369-room all-suite hotel. |
Revenue Recognition and Accounts Receivable | Revenue Recognition and Accounts Receivable Our leases with tenants are classified as operating leases. Substantially all such leases contain fixed rent escalations which occur at specified times during the term of the lease. Base rents are recognized on a straight-line basis from when the tenant controls the space through the term of the related lease, net of valuation adjustments, based on management's assessment of credit, collection and other business risks. We make estimates of the collectability of our current accounts receivable and straight-line rents receivable which require significant judgment by management. The collectability of receivables is affected by numerous different factors including current economic conditions, the impact of tenant bankruptcies, the status of collectability of current cash rents receivable, tenants' recent and historical financial and operating results, changes in our tenants' credit ratings, communications between our operating personnel and tenants, the extent of security deposits and letters of credit held with respect to tenants, and the ability of tenants to perform under the terms of their lease agreement. The provision for doubtful accounts at September 30, 2022 and December 31, 2021 was approximately $2.8 million and $4.6 million, respectively. Rent Concessions – COVID-19 From 2020 through 2022, we provided lease concessions to certain tenants, primarily within the retail segment, as a result of the COVID-19 pandemic, in the form of rent deferrals and abatements. These lease concessions generally included an increase in our rights as a lessor. We assess each lease concession and determine whether it represents a lease modifications under Accounting Standards Codification Topic 842, Leases ("ASC 842"). During the third quarter of 2022, we provided an immaterial amount of lease concessions to certain tenants that were previously impacted by and/or continued being impacted by the COVID-19 pandemic. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848), which provides companies with optional practical expedients to ease the accounting burden for contract modifications associated with transitioning away from LIBOR and other interbank offered rates that are expected to be discontinued as part of reference rate reform. For hedges, the guidance generally allows changes to the reference rate and other critical terms without having to de-designate the hedging relationship, and permits the shortcut method to continue to be applied. For contract modifications, changes in the reference rate or other critical terms will be treated as a continuation of the prior contract. This guidance can be applied immediately, however, it is generally only available through December 31, 2022, with a newly proposed sunset date of December 31, 2024. We are still evaluating the impact of reference rate reform and whether we will apply any of these practical expedients. |
Fair Value Measurement | A fair value measurement is based on the assumptions that market participants would use in pricing an asset or liability. The hierarchy for inputs used in measuring fair value is as follows: 1. Level 1 Inputs—quoted prices in active markets for identical assets or liabilities 2. Level 2 Inputs—observable inputs other than quoted prices in active markets for identical assets and liabilities 3. Level 3 Inputs—unobservable inputs The carrying values of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued liabilities are reasonable estimates of fair value, using Level 1 inputs, because of the short-term nature of these instruments. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. We measure the fair value of our deferred compensation liability, which is included in other liabilities and deferred credits on the consolidated balance sheet, on a recurring basis using Level 2 inputs. We measure the fair value of this liability based on prices provided by independent market participants that are based on observable inputs using market-based valuation techniques. The fair value of the interest rate swap agreements are based on the estimated amounts we would receive or pay to terminate the contract at the reporting date and are determined using interest rate pricing models and interest rate related observable inputs. The changes in the fair value of the derivatives that are designated as cash flow hedges are being recorded in accumulated other comprehensive income (loss) and will be subsequently reclassified into earnings during the period in which the hedged forecasted transaction affects earnings. We incorporate credit valuation adjustments to appropriately reflect both our own non-performance risk and the respective counterparty’s non-performance risk in the fair value measurements. In adjusting the fair value of our derivative contracts for the effect of non-performance risk, we considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees. |
Derivatives | The effective portion of changes in the fair value of the derivatives that are designated as cash flow hedges are being recorded in accumulated other comprehensive income and will be subsequently reclassified into earnings during the period in which the hedged forecasted transaction affects earnings for as long as hedged cash flows remain probable. During the next twelve months, we estimate the cash flow hedges in place will reduce interest expense by approximately $1.1 million.The valuation of these instruments is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of the derivative. This analysis reflects the contractual terms of the derivative, including the period to maturity and, counterparty credit risk and uses observable market-based inputs, including interest rate curves, and implied volatilities. The fair value of the interest rate swap is determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of Properties Owned | A summary of the properties owned by us is as follows: Retail Carmel Country Plaza Gateway Marketplace Alamo Quarry Market Carmel Mountain Plaza Del Monte Center Hassalo on Eighth - Retail South Bay Marketplace Geary Marketplace Lomas Santa Fe Plaza The Shops at Kalakaua Solana Beach Towne Centre Waikele Center Office La Jolla Commons One Beach Street Corporate Campus East III Torrey Reserve Campus First & Main Bel-Spring 520 Torrey Point Lloyd Portfolio Solana Crossing City Center Bellevue The Landmark at One Market Eastgate Office Park Multifamily Loma Palisades Hassalo on Eighth - Residential Imperial Beach Gardens Mariner's Point Santa Fe Park RV Resort Pacific Ridge Apartments Mixed-Use Waikiki Beach Walk Retail and Embassy Suites™ Hotel Held for Development and/or Construction in Progress La Jolla Commons – Land Solana Crossing – Land Lloyd Portfolio – Construction in Progress |
Consolidated Statements of Cash Flows-Supplemental Disclosures | The following table provides supplemental disclosures related to the Consolidated Statements of Cash Flows (in thousands): Nine Months Ended September 30, 2022 2021 Supplemental cash flow information Total interest costs incurred $ 47,792 $ 45,618 Interest capitalized $ 4,125 $ 2,029 Interest expense $ 43,667 $ 43,589 Cash paid for interest, net of amounts capitalized $ 48,145 $ 42,311 Cash paid for income taxes $ 638 $ 289 Supplemental schedule of noncash investing and financing activities Accounts payable and accrued liabilities for construction in progress $ 20,750 $ 10,119 Accrued leasing commissions $ 1,897 $ 1,072 |
REAL ESTATE (Tables)
REAL ESTATE (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Real Estate [Abstract] | |
Schedule of Purchase Price Allocation | The financial information set forth below summarizes the Company’s purchase price allocation for Bel-Spring 520 during the nine months ended September 30, 2022 (in thousands): Bel-Spring 520 Land $ 13,744 Building 27,793 Land improvements 713 Furniture, fixtures, and equipment 1,833 Total real estate 44,083 Lease intangibles 2,036 Prepaid expenses and other assets 10 Assets acquired $ 46,129 Accounts payable and accrued expenses $ (14) Security deposits payable (189) Other liabilities and deferred credits (641) Liabilities assumed $ (844) |
Schedule of Acquiree Operating Results Since Acquisition Date | The following table summarizes the operating results for Bel-Spring 520 included in the Company's historical consolidated statement of operations for the period of acquisition through September 30, 2022 (in thousands): Bel-Spring 520 Revenues $ 1,733 Operating expenses 1,689 Operating income 44 Net income attributable to American Assets Trust, Inc. $ 44 |
ACQUIRED IN-PLACE LEASES AND _2
ACQUIRED IN-PLACE LEASES AND ABOVE/BELOW MARKET LEASES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Acquired Lease Intangibles Included In Other Assets and Other Liabilities | The following summarizes our acquired lease intangibles and leasing costs, which are included in other assets and other liabilities and deferred credits, as of September 30, 2022 and December 31, 2021 (in thousands): September 30, 2022 December 31, 2021 In-place leases $ 58,119 $ 67,215 Accumulated amortization (33,216) (38,130) Above market leases 1,885 2,532 Accumulated amortization (1,768) (2,383) Acquired lease intangible assets, net $ 25,020 $ 29,234 Below market leases $ 52,832 $ 58,655 Accumulated accretion (32,347) (36,253) Acquired lease intangible liabilities, net $ 20,485 $ 22,402 |
FAIR VALUE OF FINANCIAL INSTR_2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Financial Liabilities Measured at Fair Value on Recurring Basis | A summary of our financial liabilities that are measured at fair value on a recurring basis, by level within the fair value hierarchy is as follows (in thousands): September 30, 2022 December 31, 2021 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Deferred compensation liability $ — $ 2,288 $ — $ 2,288 $ — $ 2,503 $ — $ 2,503 Interest rate swap asset $ — $ 11,310 $ — $ 11,310 $ — $ — $ — $ — Interest rate swap liability $ — $ — $ — $ — $ — $ 1,807 $ — $ 1,807 |
Carrying Amount and Fair Value of Financial Instruments | A summary of the carrying amount and fair value of our secured financial instruments, all of which are based on Level 2 inputs, is as follows (in thousands): September 30, 2022 December 31, 2021 Carrying Value Fair Value Carrying Value Fair Value Secured notes payable, net $ 74,555 $ 74,110 $ 110,965 $ 113,207 Unsecured term loans, net $ 249,321 $ 250,000 $ 249,654 $ 250,000 Unsecured senior guaranteed notes, net $ 798,260 $ 759,008 $ 797,953 $ 832,795 Senior unsecured notes, net $ 491,405 $ 403,500 $ 490,631 $ 503,000 Unsecured line of credit, net $ 33,895 $ 36,000 $ — $ — |
DERIVATIVE AND HEDGING ACTIVI_2
DERIVATIVE AND HEDGING ACTIVITIES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Interest Rate Derivatives | The following is a summary of the terms of our outstanding interest rate swaps as of September 30, 2022 (dollars in thousands): Swap Counterparty Notional Amount Effective Date Maturity Date Fair Value U.S. Bank N.A. $ 100,000 3/1/2016 3/1/2023 $ 1,142 Wells Fargo Bank, N.A. $ 50,000 5/2/2016 3/1/2023 $ 570 Bank of America, N.A. $ 50,000 1/14/2022 1/5/2027 $ 4,807 Wells Fargo Bank, N.A. $ 50,000 1/14/2022 1/5/2027 $ 4,791 |
OTHER ASSETS (Tables)
OTHER ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Components of Other Assets | Other assets consist of the following (in thousands): September 30, 2022 December 31, 2021 Leasing commissions, net of accumulated amortization of $41,197 and $40,595, respectively $ 38,590 $ 38,589 Interest rate swap asset 11,310 — Acquired above market leases, net 117 149 Acquired in-place leases, net 24,903 29,085 Lease incentives, net of accumulated amortization of $979 and $913, respectively 1,097 595 Other intangible assets, net of accumulated amortization of $1,456 and $1,382, respectively 2,259 2,445 Right-of-use lease asset, net 24,512 26,254 Prepaid expenses and other 9,633 9,136 Total other assets $ 112,421 $ 106,253 |
OTHER LIABILITIES AND DEFERRE_2
OTHER LIABILITIES AND DEFERRED CREDITS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities and Deferred Credits | Other liabilities and deferred credits consist of the following (in thousands): September 30, 2022 December 31, 2021 Acquired below market leases, net $ 20,485 $ 22,402 Prepaid rent and deferred revenue 18,618 16,309 Interest rate swap liability — 1,807 Deferred rent expense and lease intangible — 3 Deferred compensation 2,288 2,503 Deferred tax liability 967 967 Straight-line rent liability 13,559 14,274 Lease liability 26,257 27,917 Other liabilities 68 33 Total other liabilities and deferred credits, net $ 82,242 $ 86,215 |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Summary of Total Secured Notes Payable Outstanding | The following table is a summary of our total secured notes payable outstanding as of September 30, 2022 and December 31, 2021 (in thousands): Principal Balance as of Stated Interest Rate Stated Maturity Date Description of Debt September 30, 2022 December 31, 2021 as of September 30, 2022 City Center Bellevue (1) — 111,000 3.98 % November 1, 2022 City Center Bellevue (1) $ 75,000 $ — 5.08 % October 1, 2027 75,000 111,000 Debt issuance costs, net of accumulated amortization of $429 and $387, respectively (445) (35) Total Secured Notes Payable Outstanding $ 74,555 $ 110,965 (1) Interest only. The following table is a summary of the Operating Partnership's total unsecured notes payable outstanding as of September 30, 2022 and December 31, 2021 (in thousands): Description of Debt Principal Balance as of Stated Interest Rate Stated Maturity Date September 30, 2022 December 31, 2021 as of September 30, 2022 Term Loan A $ 100,000 $ 100,000 Variable (1) January 5, 2027 Term Loan B 100,000 100,000 Variable (2) March 1, 2023 Term Loan C 50,000 50,000 Variable (3) March 1, 2023 Senior Guaranteed Notes, Series F 100,000 100,000 3.78 % (4) July 19, 2024 Senior Guaranteed Notes, Series B 100,000 100,000 4.45 % February 2, 2025 Senior Guaranteed Notes, Series C 100,000 100,000 4.50 % April 1, 2025 Senior Guaranteed Notes, Series D 250,000 250,000 4.29 % (5) March 1, 2027 Senior Guaranteed Notes, Series E 100,000 100,000 4.24 % (6) May 23, 2029 Senior Guaranteed Notes, Series G 150,000 150,000 3.91 % (7) July 30, 2030 3.375% Senior Unsecured Notes 500,000 500,000 3.38 % February 1, 2031 1,550,000 1,550,000 Debt discount and issuance costs, net of accumulated amortization of $11,242 and $9,462, respectively (11,014) (11,762) Total Unsecured Notes Payable $ 1,538,986 $ 1,538,238 (1) The Operating Partnership has entered into two interest rate swap agreements that are intended to fix the interest rate associated with Term Loan A at approximately 2.70% through its maturity date, subject to adjustments based on our consolidated leverage ratio. (2) The Operating Partnership has entered into an interest rate swap agreement that is intended to fix the interest rate associated with Term Loan B at approximately 3.15% through its maturity date, subject to adjustments based on our consolidated leverage ratio. Effective March 1, 2018, the effective interest rate associated with Term Loan B is approximately 2.65%, subject to adjustments based on our consolidated leverage ratio. (3) The Operating Partnership has entered into an interest rate swap agreement that is intended to fix the interest rate associated with Term Loan C at approximately 3.14% through its maturity date, subject to adjustments based on our consolidated leverage ratio. Effective March 1, 2018, the effective interest rate associated with Term Loan C is approximately 2.64%, subject to adjustments based on our consolidated leverage ratio. (4) The Operating Partnership entered into a treasury lock contract on May 31, 2017, which was settled on June 23, 2017 at a loss of approximately $0.5 million. The treasury lock contract was deemed to be a highly effective cash flow hedge; accordingly, the effective interest rate is approximately 3.85% per annum. (5) The Operating Partnership entered into forward-starting interest rate swap contracts on March 29, 2016 and April 7, 2016, which were settled on January 18, 2017 at a gain of approximately $10.4 million. Each of the forward-starting interest swap rate contracts were deemed to be a highly effective cash flow hedge; accordingly, the effective interest rate is approximately 3.87% per annum. (6) The Operating Partnership entered into a treasury lock contract on April 25, 2017, which was settled on May 11, 2017 at a gain of approximately $0.7 million. The treasury lock contract was deemed to be a highly effective cash flow hedge; accordingly, the effective interest rate is approximately 4.18% per annum. (7) The Operating Partnership entered into a treasury lock contract on June 20, 2019, which was settled on July 17, 2019 at a gain of approximately $0.5 million. The treasury lock contract was deemed to be a highly effective cash flow hedge; accordingly, the effective interest rate is approximately 3.88% per annum. |
EQUITY OF AMERICAN ASSETS TRU_2
EQUITY OF AMERICAN ASSETS TRUST, INC. (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Dividends Declared and Paid on Shares of Common Stock and Noncontrolling Common Units | The following table lists the dividends declared and paid on our shares of common stock and noncontrolling common units during the nine months ended September 30, 2022: Period Amount per Period Covered Dividend Paid Date First Quarter 2022 $ 0.32 January 1, 2022 to March 31, 2022 March 24, 2022 Second Quarter 2022 $ 0.32 April 1, 2022 to June 30, 2022 June 23, 2022 Third Quarter 2022 $ 0.32 July 1, 2022 to September 30, 2022 September 22, 2022 |
Activity of Restricted Stock Awards | The following table summarizes the activity of restricted stock awards during the nine months ended September 30, 2022: Units Weighted Average Grant Date Fair Value Nonvested at January 1, 2022 487,397 $ 23.78 Granted 6,072 32.94 Vested (6,350) 35.66 Forfeited (3,121) 23.18 Nonvested at September 30, 2022 483,998 $ 23.74 |
Computation of Basic and Diluted EPS | The computation of basic and diluted EPS is presented below (dollars in thousands, except share and per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 NUMERATOR Net income $ 16,369 $ 12,895 $ 43,471 $ 26,115 Less: Net income attributable to restricted shares (155) (145) (464) (417) Less: Income from operations attributable to unitholders in the Operating Partnership (3,442) (2,709) (9,130) (5,459) Net income attributable to common stockholders—basic $ 12,772 $ 10,041 $ 33,877 $ 20,239 Income from operations attributable to American Assets Trust, Inc. common stockholders—basic $ 12,772 $ 10,041 $ 33,877 $ 20,239 Plus: Income from operations attributable to unitholders in the Operating Partnership 3,442 2,709 9,130 5,459 Net income attributable to common stockholders—diluted $ 16,214 $ 12,750 $ 43,007 $ 25,698 DENOMINATOR Weighted average common shares outstanding—basic 60,044,117 59,990,343 60,041,034 59,986,844 Effect of dilutive securities—conversion of Operating Partnership units 16,181,537 16,181,537 16,181,537 16,181,537 Weighted average common shares outstanding—diluted 76,225,654 76,171,880 76,222,571 76,168,381 Earnings per common share, basic $ 0.21 $ 0.17 $ 0.56 $ 0.34 Earnings per common share, diluted $ 0.21 $ 0.17 $ 0.56 $ 0.34 |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
Current Minimum Future Rentals Under the Leases | As of September 30, 2022, minimum future rentals from noncancelable operating leases, before any reserve for uncollectible amounts and assuming no early lease terminations, at our office and retail properties and the retail portion of our mixed-use property are as follows (in thousands): Year Ending December 31, 2022 (three months ending December 31, 2022) $ 56,119 2023 245,888 2024 219,526 2025 195,478 2026 179,796 Thereafter 440,435 Total $ 1,337,242 |
Current Minimum Annual Payments Under the Leases | Current annual payments under the operating leases are as follows, as of September 30, 2022 (in thousands): Year Ending December 31, 2022 (three months ending December 31, 2022) $ 820 2023 3,328 2024 3,428 2025 3,531 2026 3,584 Thereafter 16,126 Total lease payments 30,817 Imputed interest (4,560) Present value of lease liability $ 26,257 |
Lease Costs Under Operating Leases and Supplemental Cash Flow Information of Leases | Lease costs under the operating leases are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Operating lease cost $ 844 $ 831 $ 2,533 $ 3,095 Sublease income (968) (745) (2,675) (2,877) Total lease (income) cost $ (124) $ 86 $ (142) $ 218 Weighted-average remaining lease term - operating leases (in years) 8.8 Weighted-average discount rate - operating leases 3.19 % Supplemental cash flow information and non-cash activity related to our operating leases are as follow (in thousands): Nine Months Ended September 30, 2022 2021 Operating cash flow information: Cash paid for amounts included in the measurement of lease liabilities $ 2,412 $ 1,996 |
COMPONENTS OF RENTAL INCOME A_2
COMPONENTS OF RENTAL INCOME AND EXPENSE (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
Principal Components of Rental Income | The principal components of rental income are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Lease rental income Office $ 51,637 $ 45,855 $ 148,636 $ 132,229 Retail 24,310 23,438 71,637 65,866 Multifamily 13,539 12,169 39,622 35,684 Mixed-use 2,960 2,618 8,574 6,851 Percentage rent 978 969 2,216 2,593 Hotel revenue 11,379 8,164 28,848 17,626 Other 665 591 1,937 1,724 Total rental income $ 105,468 $ 93,804 $ 301,470 $ 262,573 |
Principal Components of Rental Expenses | The principal components of rental expenses are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Rental operating $ 12,272 $ 11,014 $ 34,795 $ 30,165 Hotel operating 7,230 5,429 19,352 12,287 Repairs and maintenance 5,799 4,492 15,868 12,263 Marketing 489 470 1,477 1,174 Rent 815 856 2,405 3,166 Hawaii excise tax 1,231 794 2,963 1,960 Management fees 602 411 1,576 901 Total rental expenses $ 28,438 $ 23,466 $ 78,436 $ 61,916 |
OTHER (EXPENSE) INCOME, NET (Ta
OTHER (EXPENSE) INCOME, NET (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Other Income and Expenses [Abstract] | |
Principal Components of Other Expense, Net | The principal components of other expense, net, are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Interest and investment income $ 60 $ 98 $ 117 $ 272 Income tax expense (240) (150) (640) (451) Total other (expense) income, net $ (180) $ (52) $ (523) $ (179) |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Segments Operating Activity | The following table represents operating activity within our reportable segments (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Total Office Property revenue $ 53,250 $ 47,433 $ 153,412 $ 136,467 Property expense (14,551) (13,016) (41,944) (36,029) Segment profit 38,699 34,417 111,468 100,438 Total Retail Property revenue 25,694 24,541 74,873 69,296 Property expense (7,807) (5,745) (22,965) (19,922) Segment profit 17,887 18,796 51,908 49,374 Total Multifamily Property revenue 14,748 13,085 42,851 38,376 Property expense (6,871) (6,213) (19,171) (17,197) Segment profit 7,877 6,872 23,680 21,179 Total Mixed-Use Property revenue 17,331 13,227 45,512 29,942 Property expense (10,686) (8,136) (28,549) (20,378) Segment profit 6,645 5,091 16,963 9,564 Total segments’ profit $ 71,108 $ 65,176 $ 204,019 $ 180,555 |
Reconciliation of Segment Profit to Net Income Attributable to Stockholders | The following table is a reconciliation of segment profit to net income attributable to stockholders (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Total segments’ profit $ 71,108 $ 65,176 $ 204,019 $ 180,555 General and administrative (8,376) (6,827) (23,130) (20,574) Depreciation and amortization (31,729) (30,680) (93,228) (85,827) Interest expense (14,454) (14,722) (43,667) (43,589) Loss on early extinguishment of debt — — — (4,271) Other income (expense), net (180) (52) (523) (179) Net income 16,369 12,895 43,471 26,115 Net income attributable to restricted shares (155) (145) (464) (417) Net income attributable to unitholders in the Operating Partnership (3,442) (2,709) (9,130) (5,459) Net income attributable to American Assets Trust, Inc. stockholders $ 12,772 $ 10,041 $ 33,877 $ 20,239 |
Net Real Estate and Secured Note Payable Balances by Segments | The following table shows net real estate and secured note payable balances for each of the segments (in thousands): September 30, 2022 December 31, 2021 Net Real Estate Office $ 1,610,640 $ 1,536,212 Retail 582,727 591,107 Multifamily 373,037 381,315 Mixed-Use 169,380 173,347 $ 2,735,784 $ 2,681,981 Secured Notes Payable (1) Office $ 75,000 $ 111,000 $ 75,000 $ 111,000 (1) Excludes debt issuance costs of $0.45 million and $0.04 million for each of the periods ended September 30, 2022 and December 31, 2021, respectively. |
Capital Expenditures for Each Segment | Capital expenditures for each segment for the three and nine months ended September 30, 2022 and 2021 were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Capital Expenditures (1) Office $ 24,107 $ 17,601 $ 80,824 $ 48,471 Retail 2,165 1,317 9,422 4,817 Multifamily 686 2,121 3,572 4,117 Mixed-Use 197 704 649 1,392 $ 27,155 $ 21,743 $ 94,467 $ 58,797 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 USD ($) employee segment property room | Dec. 31, 2021 USD ($) | |
Accounting Policies [Abstract] | ||
Number of employees | employee | 212 | |
Office, retail, multifamily, and mixed-use operating properties | 31 | |
Properties held for development | 3 | |
Number of operating segments | segment | 4 | |
Room in mixed-use segment all-suite hotel | room | 369 | |
Allowance for doubtful accounts | $ | $ 2.8 | $ 4.6 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Supplement Disclosures Related to Consolidated Statements of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Accounting Policies [Abstract] | ||||
Total interest costs incurred | $ 47,792 | $ 45,618 | ||
Interest capitalized | 4,125 | 2,029 | ||
Interest expense | $ 14,454 | $ 14,722 | 43,667 | 43,589 |
Cash paid for interest, net of amounts capitalized | 48,145 | 42,311 | ||
Cash paid for income taxes | 638 | 289 | ||
Accounts payable and accrued liabilities for construction in progress | 20,750 | 10,119 | ||
Accrued leasing commissions | $ 1,897 | $ 1,072 |
REAL ESTATE - Narrative (Detail
REAL ESTATE - Narrative (Details) - Office Building - Bel-Spring 520 ft² in Thousands, $ in Millions | 9 Months Ended | |
Mar. 08, 2022 USD ($) ft² | Sep. 30, 2022 | |
Real Estate [Line Items] | ||
Area of real estate property | ft² | 93 | |
Payments to acquire productive assets | $ 45.5 | |
Purchase price seller credits, future rent abatement | 0.1 | |
Purchase price seller credits, contractual tenant improvements | 0.6 | |
Acquisition cost capitalized | $ 0.1 | |
Leases | ||
Real Estate [Line Items] | ||
Weighted average useful life (in years) | 3 years 3 months 18 days |
REAL ESTATE - Purchase Price Al
REAL ESTATE - Purchase Price Allocation (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Real Estate [Line Items] | ||
Lease intangibles | $ 24,903 | $ 29,085 |
Prepaid expenses and other assets | 9,633 | 9,136 |
Total assets | 3,008,577 | 3,017,927 |
Accounts payable and accrued expenses | (72,355) | (64,531) |
Security deposits payable | (8,821) | (7,855) |
Other liabilities and deferred credits | (82,242) | (86,215) |
Liabilities assumed | (1,810,854) | $ (1,807,804) |
Office Building | Bel-Spring 520 | ||
Real Estate [Line Items] | ||
Land | 13,744 | |
Building | 27,793 | |
Land improvements | 713 | |
Furniture, fixtures, and equipment | 1,833 | |
Total real estate | 44,083 | |
Lease intangibles | 2,036 | |
Prepaid expenses and other assets | 10 | |
Total assets | 46,129 | |
Accounts payable and accrued expenses | (14) | |
Security deposits payable | (189) | |
Other liabilities and deferred credits | (641) | |
Liabilities assumed | $ (844) |
REAL ESTATE - Operating Results
REAL ESTATE - Operating Results for Acquisition (Details) - USD ($) $ in Thousands | 3 Months Ended | 7 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
Real Estate [Line Items] | |||||||||
Revenues | $ 111,023 | $ 98,286 | $ 316,648 | $ 274,081 | |||||
OPERATING INCOME | 31,003 | 27,669 | 87,661 | 74,154 | |||||
Net income attributable to American Assets Trust, Inc. | $ 16,369 | $ 13,588 | $ 13,514 | $ 12,895 | $ 11,487 | $ 1,733 | $ 43,471 | $ 26,115 | |
Office Building | Bel-Spring 520 | |||||||||
Real Estate [Line Items] | |||||||||
Revenues | $ 1,733 | ||||||||
Operating expenses | 1,689 | ||||||||
OPERATING INCOME | 44 | ||||||||
Net income attributable to American Assets Trust, Inc. | $ 44 |
ACQUIRED IN-PLACE LEASES AND _3
ACQUIRED IN-PLACE LEASES AND ABOVE/BELOW MARKET LEASES Acquired Lease Intangibles and Leasing Costs Included in Other Assets and Other Liabilities and Deferred Credits (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Accumulated amortization | $ (1,456) | $ (1,382) |
Below market leases | 52,832 | 58,655 |
Accumulated accretion | (32,347) | (36,253) |
Acquired lease intangible liabilities, net | 20,485 | 22,402 |
Leases | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Acquired lease intangible assets, net | 25,020 | 29,234 |
In-place leases | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Leases, gross | 58,119 | 67,215 |
Accumulated amortization | (33,216) | (38,130) |
Above market leases | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Leases, gross | 1,885 | 2,532 |
Accumulated amortization | $ (1,768) | $ (2,383) |
FAIR VALUE OF FINANCIAL INSTR_3
FAIR VALUE OF FINANCIAL INSTRUMENTS - Financial Liabilities Fair Value Measurement on a Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation liability | $ 2,288 | $ 2,503 |
Interest rate swap asset | 11,310 | 0 |
Interest rate swap liability | 0 | 1,807 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation liability | 0 | 0 |
Interest rate swap asset | 0 | 0 |
Interest rate swap liability | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation liability | 2,288 | 2,503 |
Interest rate swap asset | 11,310 | 0 |
Interest rate swap liability | 0 | 1,807 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation liability | 0 | 0 |
Interest rate swap asset | 0 | 0 |
Interest rate swap liability | $ 0 | $ 0 |
FAIR VALUE OF FINANCIAL INSTR_4
FAIR VALUE OF FINANCIAL INSTRUMENTS - Narrative (Details) - Level 2 | Sep. 30, 2022 |
Minimum | |
Fair Value Inputs Disclosures | |
Fair value assumptions, interest rate (as a percent) | 0.056 |
Maximum | |
Fair Value Inputs Disclosures | |
Fair value assumptions, interest rate (as a percent) | 0.061 |
FAIR VALUE OF FINANCIAL INSTR_5
FAIR VALUE OF FINANCIAL INSTRUMENTS - Carrying Amount and Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Secured notes payable, net | Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | $ 74,555 | $ 110,965 |
Unsecured term loans, net | Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 249,321 | 249,654 |
Unsecured senior guaranteed notes, net | Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 798,260 | 797,953 |
Senior unsecured notes, net | Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 491,405 | 490,631 |
Unsecured line of credit, net | Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 33,895 | 0 |
Level 2 | Secured notes payable, net | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 74,110 | 113,207 |
Level 2 | Unsecured term loans, net | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 250,000 | 250,000 |
Level 2 | Unsecured senior guaranteed notes, net | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 759,008 | 832,795 |
Level 2 | Senior unsecured notes, net | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 403,500 | 503,000 |
Level 2 | Unsecured line of credit, net | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | $ 36,000 | $ 0 |
DERIVATIVE AND HEDGING ACTIVI_3
DERIVATIVE AND HEDGING ACTIVITIES (Details) | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Estimated derivative reclassification from Accumulated OCI to Income | $ 1,100,000 |
Designated as Hedging Instrument | Cash Flow Hedging | American Assets Trust, L.P. | Interest Rate Swap, 3/1/2023 | U.S. Bank N.A. | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Notional Amount | 100,000,000 |
Fair Value | 1,142,000 |
Designated as Hedging Instrument | Cash Flow Hedging | American Assets Trust, L.P. | Interest Rate Swap, 3/1/2023 | Wells Fargo Bank, N.A. | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Notional Amount | 50,000,000 |
Fair Value | 570,000 |
Designated as Hedging Instrument | Cash Flow Hedging | American Assets Trust, L.P. | Interest Rate Swap, 1/5/2027 | Wells Fargo Bank, N.A. | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Notional Amount | 50,000,000 |
Fair Value | 4,791,000 |
Designated as Hedging Instrument | Cash Flow Hedging | American Assets Trust, L.P. | Interest Rate Swap, 1/5/2027 | Bank of America, N.A. | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Notional Amount | 50,000,000 |
Fair Value | $ 4,807,000 |
OTHER ASSETS (Details)
OTHER ASSETS (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Leasing commissions, net of accumulated amortization of $41,664 and $40,595, respectively | $ 38,590 | $ 38,589 |
Interest rate swap asset | 11,310 | 0 |
Acquired above market leases, net | 117 | 149 |
Acquired in-place leases, net | 24,903 | 29,085 |
Lease incentives, net of accumulated amortization of $979 and $913, respectively | 1,097 | 595 |
Other intangible assets, net of accumulated amortization of $1,456 and $1,382, respectively | 2,259 | 2,445 |
Right-of-use lease asset, net | 24,512 | 26,254 |
Prepaid expenses and other | 9,633 | 9,136 |
Total other assets | 112,421 | 106,253 |
Leasing commissions, accumulative amortization | 41,197 | 40,595 |
Lease incentives, accumulated amortization | 979 | 913 |
Other intangible assets, accumulated amortization | $ 1,456 | $ 1,382 |
OTHER LIABILITIES AND DEFERRE_3
OTHER LIABILITIES AND DEFERRED CREDITS (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Other Liabilities Disclosure [Abstract] | ||
Acquired below market leases, net | $ 20,485 | $ 22,402 |
Prepaid rent and deferred revenue | 18,618 | 16,309 |
Interest rate swap liability | 0 | 1,807 |
Deferred rent expense and lease intangible | 0 | 3 |
Deferred compensation | 2,288 | 2,503 |
Deferred tax liability | 967 | 967 |
Straight-line rent liability | 13,559 | 14,274 |
Lease liability | 26,257 | 27,917 |
Other liabilities | 68 | 33 |
Total other liabilities and deferred credits, net | $ 82,242 | $ 86,215 |
DEBT - Summary of Total Secured
DEBT - Summary of Total Secured Notes Payable Outstanding (Details) - American Assets Trust, L.P. - Secured notes payable, net - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Long-term debt, principal balance | $ 75,000 | $ 111,000 |
Debt issuance costs, net | (445) | (35) |
Total Debt Outstanding | 74,555 | 110,965 |
Debt issuance costs, accumulated amortization | 429 | 387 |
3.98% City Center Bellevue, November 2022 | ||
Debt Instrument [Line Items] | ||
Long-term debt, principal balance | $ 0 | 111,000 |
Stated interest rate | 3.98% | |
5.08% City Center Bellevue, October 2027 | ||
Debt Instrument [Line Items] | ||
Long-term debt, principal balance | $ 75,000 | $ 0 |
Stated interest rate | 5.08% |
DEBT - Narrative (Details)
DEBT - Narrative (Details) | 3 Months Ended | 9 Months Ended | ||||||||||
Sep. 16, 2022 USD ($) | Jan. 05, 2022 USD ($) extension | Jan. 26, 2021 USD ($) | Jan. 09, 2019 extension | Jan. 09, 2018 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Jan. 14, 2022 interest_rate_swap_agreement | Dec. 31, 2021 USD ($) | Mar. 01, 2018 | |
Debt Instrument [Line Items] | ||||||||||||
Repayments of unsecured debt | $ 0 | $ 155,375,000 | ||||||||||
Loss on early extinguishment of debt | $ 0 | $ 0 | 0 | (4,271,000) | ||||||||
Repayments of line of credit | 0 | 100,000,000 | ||||||||||
Line of credit | 33,895,000 | 33,895,000 | $ 0 | |||||||||
Unsecured line of credit, net | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Maximum leverage ratio of revolving credit facility | 60% | |||||||||||
Maximum secured leverage ratio on revolving credit facility | 40% | |||||||||||
Minimum fixed charge coverage ratio covenant threshold | 1.50 | |||||||||||
Minimum unsecured leverage ratio | 175% | |||||||||||
Maximum unsecured leverage ratio | 60% | |||||||||||
Maximum recourse indebtedness of total asset value | 15% | |||||||||||
Third Amended and Restated Credit Facility | Unsecured line of credit, net | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Percentage annual distributions cannot exceed funds from operations | 95% | |||||||||||
American Assets Trust, L.P. | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Repayments of unsecured debt | 0 | 155,375,000 | ||||||||||
Loss on early extinguishment of debt | 0 | $ 0 | 0 | (4,271,000) | ||||||||
Repayments of line of credit | 0 | $ 100,000,000 | ||||||||||
Line of credit | $ 33,895,000 | $ 33,895,000 | $ 0 | |||||||||
American Assets Trust, L.P. | Unsecured line of credit, net | Minimum | London Interbank Offered Rate (LIBOR) | Revolving Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1.05% | |||||||||||
American Assets Trust, L.P. | Unsecured line of credit, net | Maximum | London Interbank Offered Rate (LIBOR) | Revolving Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1.50% | |||||||||||
American Assets Trust, L.P. | 5.08% City Center Bellevue, October 2027 | Secured notes payable, net | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Extinguishment of debt | $ 111,000,000 | |||||||||||
Stated interest rate | 5.08% | 5.08% | ||||||||||
American Assets Trust, L.P. | 5.08% City Center Bellevue, October 2027 | Mortgages | Nonrecourse | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Face amount of debt | $ 75,000,000 | |||||||||||
Term of debt instrument | 5 years | |||||||||||
Stated interest rate | 5.08% | |||||||||||
American Assets Trust, L.P. | 3.375% Senior Unsecured Notes | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Stated interest rate | 3.375% | |||||||||||
Note offering percent | 0.98935 | |||||||||||
Weighted average yield of investment (as a percent) | 3.502% | |||||||||||
Proceeds from debt, net of issuance costs | $ 489,700,000 | |||||||||||
American Assets Trust, L.P. | 3.375% Senior Unsecured Notes | Unsecured term loans, net | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Face amount of debt | 500,000,000 | |||||||||||
Stated interest rate | 3.375% | 3.375% | ||||||||||
American Assets Trust, L.P. | Senior Guaranteed Notes, Series A | Unsecured term loans, net | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Repayments of unsecured debt | 150,000,000 | |||||||||||
Loss on early extinguishment of debt | 3,900,000 | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Revolving credit facility borrowing limit, maximum borrowing capacity | $ 450,000,000 | |||||||||||
Additional borrowing capacity | 250,000,000 | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured term loans, net | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Revolving credit facility borrowing limit, maximum borrowing capacity | $ 100,000,000 | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured term loans, net | London Interbank Offered Rate (LIBOR) | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1% | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured term loans, net | Federal Funds Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.50% | 0.50% | ||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured term loans, net | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1% | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured term loans, net | Minimum | London Interbank Offered Rate (LIBOR) | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1.30% | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured term loans, net | Minimum | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.30% | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured term loans, net | Maximum | London Interbank Offered Rate (LIBOR) | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1.90% | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured term loans, net | Maximum | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.90% | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured line of credit, net | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Repayments of line of credit | $ 100,000,000 | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured line of credit, net | Revolving Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Revolving credit facility borrowing limit, maximum borrowing capacity | $ 350,000,000 | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured line of credit, net | Minimum | London Interbank Offered Rate (LIBOR) | Revolving Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1.05% | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured line of credit, net | Minimum | Base Rate | Revolving Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.10% | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured line of credit, net | Maximum | London Interbank Offered Rate (LIBOR) | Revolving Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1.50% | |||||||||||
American Assets Trust, L.P. | Second Amended and Restated Credit Facility | Unsecured line of credit, net | Maximum | Base Rate | Revolving Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.50% | |||||||||||
American Assets Trust, L.P. | Term Loan B | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Term of debt instrument | 7 years | |||||||||||
American Assets Trust, L.P. | Term Loan B | Minimum | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.70% | |||||||||||
American Assets Trust, L.P. | Term Loan B | Maximum | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1.35% | |||||||||||
American Assets Trust, L.P. | Term Loan B | Interest Rate Swap | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Derivative fixed interest rate (in percent) | 3.15% | 3.15% | 2.65% | |||||||||
American Assets Trust, L.P. | Term Loan B | Unsecured term loans, net | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Minimum base rate | 0% | |||||||||||
American Assets Trust, L.P. | Term Loan B | Unsecured term loans, net | Federal Funds Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.50% | |||||||||||
American Assets Trust, L.P. | Term Loan B | Unsecured term loans, net | Eurodollar | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1% | |||||||||||
American Assets Trust, L.P. | Term Loan B | Unsecured term loans, net | Minimum | London Interbank Offered Rate (LIBOR) | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1.20% | |||||||||||
American Assets Trust, L.P. | Term Loan B | Unsecured term loans, net | Maximum | London Interbank Offered Rate (LIBOR) | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1.70% | |||||||||||
American Assets Trust, L.P. | Term Loan B & Term Loan C | Unsecured term loans, net | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Face amount of debt | $ 150,000,000 | |||||||||||
American Assets Trust, L.P. | First Amendment To Second Amended And Restated Credit Facility | Minimum | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.20% | |||||||||||
American Assets Trust, L.P. | First Amendment To Second Amended And Restated Credit Facility | Maximum | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.70% | |||||||||||
American Assets Trust, L.P. | First Amendment To Second Amended And Restated Credit Facility | Unsecured term loans, net | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Debt extension options | extension | 3 | |||||||||||
Extension term | 1 year | |||||||||||
American Assets Trust, L.P. | First Amendment To Second Amended And Restated Credit Facility | Unsecured term loans, net | Federal Funds Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.50% | |||||||||||
American Assets Trust, L.P. | First Amendment To Second Amended And Restated Credit Facility | Unsecured term loans, net | Eurodollar | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1% | |||||||||||
American Assets Trust, L.P. | First Amendment To Second Amended And Restated Credit Facility | Unsecured term loans, net | Minimum | London Interbank Offered Rate (LIBOR) | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1.20% | |||||||||||
American Assets Trust, L.P. | First Amendment To Second Amended And Restated Credit Facility | Unsecured term loans, net | Maximum | London Interbank Offered Rate (LIBOR) | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1.70% | |||||||||||
American Assets Trust, L.P. | Third Amended and Restated Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Revolving credit facility borrowing limit, maximum borrowing capacity | $ 500,000,000 | |||||||||||
American Assets Trust, L.P. | Third Amended and Restated Credit Facility | Interest Rate Swap | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Number of interest rate swap agreements | interest_rate_swap_agreement | 2 | |||||||||||
Derivative fixed interest rate (in percent) | 2.70% | |||||||||||
American Assets Trust, L.P. | Third Amended and Restated Credit Facility | Unsecured term loans, net | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Revolving credit facility borrowing limit, maximum borrowing capacity | $ 100,000,000 | |||||||||||
Debt extension options | extension | 2 | |||||||||||
Extension term | 6 months | |||||||||||
American Assets Trust, L.P. | Third Amended and Restated Credit Facility | Unsecured term loans, net | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Minimum base rate | 1% | |||||||||||
American Assets Trust, L.P. | Third Amended and Restated Credit Facility | Unsecured term loans, net | Minimum | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.20% | |||||||||||
American Assets Trust, L.P. | Third Amended and Restated Credit Facility | Unsecured term loans, net | Minimum | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1.20% | |||||||||||
American Assets Trust, L.P. | Third Amended and Restated Credit Facility | Unsecured term loans, net | Maximum | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.70% | |||||||||||
American Assets Trust, L.P. | Third Amended and Restated Credit Facility | Unsecured term loans, net | Maximum | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 1.70% | |||||||||||
American Assets Trust, L.P. | Third Amended and Restated Credit Facility | Unsecured line of credit, net | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Line of credit | $ 36,000,000 | $ 36,000,000 | ||||||||||
Debt issuance costs, net, revolving credit facility | $ 2,100,000 | $ 2,100,000 | ||||||||||
Weighted average interest rate, revolving credit facility | 2.26% | |||||||||||
American Assets Trust, L.P. | Third Amended and Restated Credit Facility | Unsecured line of credit, net | Revolving Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Revolving credit facility borrowing limit, maximum borrowing capacity | $ 400,000,000 | |||||||||||
American Assets Trust, L.P. | Third Amended and Restated Credit Facility | Unsecured line of credit, net | Minimum | Base Rate | Revolving Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.10% | |||||||||||
American Assets Trust, L.P. | Third Amended and Restated Credit Facility | Unsecured line of credit, net | Maximum | Base Rate | Revolving Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable rate | 0.50% |
DEBT - Summary of Total Unsecur
DEBT - Summary of Total Unsecured Notes Payable Outstanding (Details) - American Assets Trust, L.P. $ in Thousands | Jul. 17, 2019 USD ($) | Jun. 23, 2017 USD ($) | May 11, 2017 USD ($) | Jan. 18, 2017 USD ($) | Sep. 30, 2022 USD ($) interest_rate_swap_agreement | Dec. 31, 2021 USD ($) | Jan. 26, 2021 | Mar. 01, 2018 |
Forward Contracts | ||||||||
Debt Instrument [Line Items] | ||||||||
Loss on derivative settlement | $ 500 | |||||||
Gain on derivative settlement | $ 500 | $ 700 | $ 10,400 | |||||
Unsecured term loans, net | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt, principal balance | $ 1,550,000 | $ 1,550,000 | ||||||
Debt issuance costs, net | (11,014) | (11,762) | ||||||
Total Debt Outstanding | 1,538,986 | 1,538,238 | ||||||
Debt issuance costs, accumulated amortization | $ 11,242 | 9,462 | ||||||
Term Loan A | Interest Rate Swap | ||||||||
Debt Instrument [Line Items] | ||||||||
Number of interest rate | interest_rate_swap_agreement | 2 | |||||||
Derivative fixed interest rate (in percent) | 2.70% | |||||||
Term Loan A | Unsecured term loans, net | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt, principal balance | $ 100,000 | 100,000 | ||||||
Term Loan B | Interest Rate Swap | ||||||||
Debt Instrument [Line Items] | ||||||||
Derivative fixed interest rate (in percent) | 3.15% | 2.65% | ||||||
Term Loan B | Unsecured term loans, net | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt, principal balance | $ 100,000 | 100,000 | ||||||
Term Loan C | Interest Rate Swap | ||||||||
Debt Instrument [Line Items] | ||||||||
Derivative fixed interest rate (in percent) | 3.14% | 2.64% | ||||||
Term Loan C | Unsecured term loans, net | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt, principal balance | $ 50,000 | 50,000 | ||||||
Senior Guaranteed Notes, Series F | Forward Contracts | ||||||||
Debt Instrument [Line Items] | ||||||||
Effective rate of debt instrument (in percent) | 3.85% | |||||||
Senior Guaranteed Notes, Series F | Unsecured term loans, net | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt, principal balance | $ 100,000 | 100,000 | ||||||
Stated interest rate | 3.78% | |||||||
Senior Guaranteed Notes, Series B | Unsecured term loans, net | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt, principal balance | $ 100,000 | 100,000 | ||||||
Stated interest rate | 4.45% | |||||||
Senior Guaranteed Notes, Series C | Unsecured term loans, net | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt, principal balance | $ 100,000 | 100,000 | ||||||
Stated interest rate | 4.50% | |||||||
Senior Guaranteed Notes, Series D | Forward Contracts | ||||||||
Debt Instrument [Line Items] | ||||||||
Effective rate of debt instrument (in percent) | 3.87% | |||||||
Senior Guaranteed Notes, Series D | Unsecured term loans, net | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt, principal balance | $ 250,000 | 250,000 | ||||||
Stated interest rate | 4.29% | |||||||
Senior Guaranteed Notes, Series E | Forward Contracts | ||||||||
Debt Instrument [Line Items] | ||||||||
Effective rate of debt instrument (in percent) | 4.18% | |||||||
Senior Guaranteed Notes, Series E | Unsecured term loans, net | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt, principal balance | $ 100,000 | 100,000 | ||||||
Stated interest rate | 4.24% | |||||||
Senior Guaranteed Notes, Series G | Forward Contracts | ||||||||
Debt Instrument [Line Items] | ||||||||
Effective rate of debt instrument (in percent) | 3.88% | |||||||
Senior Guaranteed Notes, Series G | Unsecured term loans, net | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt, principal balance | $ 150,000 | 150,000 | ||||||
Stated interest rate | 3.91% | |||||||
3.375% Senior Unsecured Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate | 3.375% | |||||||
3.375% Senior Unsecured Notes | Unsecured term loans, net | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt, principal balance | $ 500,000 | $ 500,000 | ||||||
Stated interest rate | 3.375% |
PARTNERS' CAPITAL OF AMERICAN_2
PARTNERS' CAPITAL OF AMERICAN ASSETS TRUST, L.P. (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 shares | Sep. 30, 2021 shares | Sep. 30, 2022 shares | Sep. 30, 2021 shares | |
Capital Unit [Line Items] | ||||
Antidilutive securities excluded from computation of EPS (in shares) | 483,110 | 481,966 | 483,895 | 485,897 |
American Assets Trust, L.P. | ||||
Capital Unit [Line Items] | ||||
Percentage of ownership interests classified as noncontrolling | 21.20% | 21.20% | ||
American Assets Trust, L.P. | ||||
Capital Unit [Line Items] | ||||
Noncontrolling common units (in shares) | 16,181,537 | 16,181,537 | ||
American Assets Trust, L.P. | Operating Partnership Units | ||||
Capital Unit [Line Items] | ||||
Antidilutive securities excluded from computation of EPS (in shares) | 483,110 | 481,966 | 483,895 | 485,897 |
Limited Partner | American Assets Trust, L.P. | ||||
Capital Unit [Line Items] | ||||
Common unit conversion ratio | 1 | |||
Common Shares | American Assets Trust, L.P. | ||||
Capital Unit [Line Items] | ||||
Conversion of operating partnership units (in shares) | 0 |
EQUITY OF AMERICAN ASSETS TRU_3
EQUITY OF AMERICAN ASSETS TRUST, INC. - Narrative (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Dec. 03, 2021 USD ($) sales_agent | Sep. 30, 2022 USD ($) shares | Sep. 30, 2021 USD ($) shares | Sep. 30, 2022 USD ($) shares | Sep. 30, 2021 USD ($) shares | |
Equity [Line Items] | |||||
Stock-based compensation expense | $ 2,000 | $ 1,500 | $ 5,491 | $ 4,452 | |
Share-based compensation expense not yet recognized | $ 5,200 | $ 5,200 | |||
Antidilutive securities excluded from computation of EPS (in shares) | shares | 483,110 | 481,966 | 483,895 | 485,897 | |
At The Market Equity Program | |||||
Equity [Line Items] | |||||
Number of sales agents | sales_agent | 5 | ||||
Aggregate offering price of common share | $ 250,000 | ||||
Remaining capacity to issue | $ 250,000 | $ 250,000 |
EQUITY OF AMERICAN ASSETS TRU_4
EQUITY OF AMERICAN ASSETS TRUST, INC. - Dividends Declare and Paid on Shares on Common Stock and Noncontrolling Common Units (Details) - $ / shares | 3 Months Ended | ||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | |
Equity [Abstract] | |||
Amount per Share/Unit (in USD per unit) | $ 0.32 | $ 0.32 | $ 0.32 |
EQUITY OF AMERICAN ASSETS TRU_5
EQUITY OF AMERICAN ASSETS TRUST, INC. - Summary of Activity of Restricted Stock Awards (Details) - Restricted Stock Units (RSUs) | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Units | |
Nonvested, Beginning, Shares | shares | 487,397 |
Granted, Shares | shares | 6,072 |
Vested, Shares | shares | (6,350) |
Forfeited, Shares | shares | (3,121) |
Nonvested, End of year, shares | shares | 483,998 |
Weighted Average Grant Date Fair Value | |
Nonvested, Beginning, USD per share | $ / shares | $ 23.78 |
Granted, USD per share | $ / shares | 32.94 |
Vested, USD per share | $ / shares | 35.66 |
Forfeited, USD per share | $ / shares | 23.18 |
Nonvested, End of year, USD per share | $ / shares | $ 23.74 |
EQUITY OF AMERICAN ASSETS TRU_6
EQUITY OF AMERICAN ASSETS TRUST, INC. - Computation of Basic and Diluted EPS (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
NUMERATOR | ||||
Net income | $ 16,369 | $ 12,895 | $ 43,471 | $ 26,115 |
Less: Net income attributable to restricted shares | (155) | (145) | (464) | (417) |
Less: Income from operations attributable to unitholders in the Operating Partnership | (3,442) | (2,709) | (9,130) | (5,459) |
Net income attributable to American Assets Trust, Inc. stockholders | 12,772 | 10,041 | 33,877 | 20,239 |
Income from operations attributable to American Assets Trust, Inc. common stockholders—basic | 12,772 | 10,041 | 33,877 | 20,239 |
Plus: Income from operations attributable to unitholders in the Operating Partnership | 3,442 | 2,709 | 9,130 | 5,459 |
Net income attributable to common stockholders—diluted | $ 16,214 | $ 12,750 | $ 43,007 | $ 25,698 |
DENOMINATOR | ||||
Weighted average shares of common stock outstanding-basic (in shares) | 60,044,117 | 59,990,343 | 60,041,034 | 59,986,844 |
Effect of dilutive securities-conversion of Operating Partnership units (in shares) | 16,181,537 | 16,181,537 | 16,181,537 | 16,181,537 |
Weighted average common shares outstanding - diluted (in shares) | 76,225,654 | 76,171,880 | 76,222,571 | 76,168,381 |
Earnings per common share, basic (in USD per share) | $ 0.21 | $ 0.17 | $ 0.56 | $ 0.34 |
Earnings per common share, diluted (in USD per share) | $ 0.21 | $ 0.17 | $ 0.56 | $ 0.34 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||||
Deferred tax liability | $ 967 | $ 967 | $ 967 | ||
Income tax expense | $ 240 | $ 150 | $ 640 | $ 451 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) mo property | |
Commitment And Contingencies [Line Items] | |
Termination payment | $ | $ 5,400 |
Number of consolidated properties located in Southern California | property | 15 |
Total Revenues | Industry Concentration Risk | Retail | |
Commitment And Contingencies [Line Items] | |
Proportion of total revenue provided by retail or office tenants (as a percent) | 23.60% |
Total Revenues | Industry Concentration Risk | Office | |
Commitment And Contingencies [Line Items] | |
Proportion of total revenue provided by retail or office tenants (as a percent) | 48.40% |
Waikiki Beach Walk - Retail | |
Commitment And Contingencies [Line Items] | |
Property management fee (as a percent) | 3% |
Outrigger Hotels | |
Commitment And Contingencies [Line Items] | |
Property management fee (as a percent) | 6% |
Number of calendar months termination fee is based | 2 months |
Maximum proportion of hotel's fiscal year gross revenues paid for aggregate yearly management fee (as a percent) | 3.50% |
Previous months of management fees | 12 months |
Hotel management agreement default penalty factor of previous twelve months of management fees in first 11 years of term | 8 |
Years in hotel management agreement term | 11 years |
Hotel management agreement default penalty factor of previous twelve months of management fees in twelfth year of term | 4 |
Hotel management agreement default penalty factor of previous twelve months of management fees in thirteenth year of term | 3 |
Hotel management agreement default penalty factor of previous twelve months of management fees in fourteenth year of term | 2 |
Hotel management agreement default penalty factor of previous twelve months of management fees in fifteenth year of term | 1 |
Payment for management fee | $ | $ 12 |
Outrigger Hotels | Maximum | |
Commitment And Contingencies [Line Items] | |
Property management fee (as a percent) | 3% |
Outrigger Hotels | Future Year Period One | |
Commitment And Contingencies [Line Items] | |
Years in hotel management agreement term | 15 years |
Outrigger Hotels | Future Year Period Two | |
Commitment And Contingencies [Line Items] | |
Years in hotel management agreement term | 14 years |
Outrigger Hotels | Future Year Period Three | |
Commitment And Contingencies [Line Items] | |
Years in hotel management agreement term | 13 years |
Outrigger Hotels | Future Year Period Four | |
Commitment And Contingencies [Line Items] | |
Years in hotel management agreement term | 12 years |
Wbw Hotel Lessee Llc | |
Commitment And Contingencies [Line Items] | |
Years of contract | 20 years |
Proportion of hotel occupancy gross revenue paid for program fee (as a percent) | 4% |
Wbw Hotel Lessee Llc | Future Time Period Prior to 12-31-2021 | |
Commitment And Contingencies [Line Items] | |
Proportion of hotel occupancy gross revenue paid for franchise royalty fee (as a percent) | 4% |
Wbw Hotel Lessee Llc | Future Time Period After 12-31-2021 | |
Commitment And Contingencies [Line Items] | |
Proportion of hotel occupancy gross revenue paid for franchise royalty fee (as a percent) | 5% |
Del Monte Center | Maximum | |
Commitment And Contingencies [Line Items] | |
Years, environmental remediation length | 7 years |
Del Monte Center | Minimum | |
Commitment And Contingencies [Line Items] | |
Years, environmental remediation length | 5 years |
LEASES - Narrative (Details)
LEASES - Narrative (Details) | 9 Months Ended |
Sep. 30, 2022 | |
Lessor, Lease, Description [Line Items] | |
Years, minimum term range of office and retail leases | 3 years |
Years, maximum term range of office and retail leases | 10 years |
Months, minimum term of apartment leases | 7 months |
Months, maximum term of apartment leases | 15 months |
Operating leases rental period terms | 12 months |
Minimum | |
Lessor, Lease, Description [Line Items] | |
Lease extension option period | 3 years |
Lease extension options exercise period | 6 months |
Maximum | |
Lessor, Lease, Description [Line Items] | |
Lease extension option period | 10 years |
Lease extension options exercise period | 12 months |
Landmark at One Market | |
Lessor, Lease, Description [Line Items] | |
Lease extension option exercise period | 5 years |
LEASES - Minimum Future Rentals
LEASES - Minimum Future Rentals from Noncancelable Operating Leases (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Leases [Abstract] | |
2022 (three months ending December 31, 2022) | $ 56,119 |
2023 | 245,888 |
2024 | 219,526 |
2025 | 195,478 |
2026 | 179,796 |
Thereafter | 440,435 |
Total | $ 1,337,242 |
LEASES - Lease Obligations - Mi
LEASES - Lease Obligations - Minimum Future Rental Payments from Operating Leases (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
2022 (three months ending December 31, 2022) | $ 820 | |
2023 | 3,328 | |
2024 | 3,428 | |
2025 | 3,531 | |
2026 | 3,584 | |
Thereafter | 16,126 | |
Total lease payments | 30,817 | |
Imputed interest | (4,560) | |
Present value of lease liability | $ 26,257 | $ 27,917 |
LEASES - Lease Costs & Addition
LEASES - Lease Costs & Additional Lease Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Leases [Abstract] | ||||
Operating lease cost | $ 844 | $ 831 | $ 2,533 | $ 3,095 |
Sublease income | (968) | (745) | (2,675) | (2,877) |
Total lease (income) cost | $ (124) | $ 86 | $ (142) | $ 218 |
Weighted-average remaining lease term - operating leases (in years) | 8 years 9 months 18 days | 8 years 9 months 18 days | ||
Weighted-average discount rate - operating leases (as a percent) | 3.19% | 3.19% |
LEASES - Supplemental Lease Inf
LEASES - Supplemental Lease Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Operating cash flow information: | ||
Cash paid for amounts included in the measurement of lease liabilities | $ 2,412 | $ 1,996 |
COMPONENTS OF RENTAL INCOME A_3
COMPONENTS OF RENTAL INCOME AND EXPENSE - Component of Rental Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Rental Income [Line Items] | ||||
Percentage rent | $ 978 | $ 969 | $ 2,216 | $ 2,593 |
Hotel revenue | 11,379 | 8,164 | 28,848 | 17,626 |
Other | 665 | 591 | 1,937 | 1,724 |
Total rental income | 105,468 | 93,804 | 301,470 | 262,573 |
Office | ||||
Rental Income [Line Items] | ||||
Lease rental income | 51,637 | 45,855 | 148,636 | 132,229 |
Retail | ||||
Rental Income [Line Items] | ||||
Lease rental income | 24,310 | 23,438 | 71,637 | 65,866 |
Multifamily | ||||
Rental Income [Line Items] | ||||
Lease rental income | 13,539 | 12,169 | 39,622 | 35,684 |
Mixed-use | ||||
Rental Income [Line Items] | ||||
Lease rental income | $ 2,960 | $ 2,618 | $ 8,574 | $ 6,851 |
COMPONENTS OF RENTAL INCOME A_4
COMPONENTS OF RENTAL INCOME AND EXPENSE - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Leases [Abstract] | ||||
Recognition of straight-line rents | $ 2.5 | $ 3.8 | $ 6.3 | $ 10.8 |
Recognition of amortization of above and below market leases | $ 0.8 | $ 0.8 | $ 2.5 | $ 2.4 |
COMPONENTS OF RENTAL INCOME A_5
COMPONENTS OF RENTAL INCOME AND EXPENSE - Components of Rental Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Leases [Abstract] | ||||
Rental operating | $ 12,272 | $ 11,014 | $ 34,795 | $ 30,165 |
Hotel operating | 7,230 | 5,429 | 19,352 | 12,287 |
Repairs and maintenance | 5,799 | 4,492 | 15,868 | 12,263 |
Marketing | 489 | 470 | 1,477 | 1,174 |
Rent | 815 | 856 | 2,405 | 3,166 |
Hawaii excise tax | 1,231 | 794 | 2,963 | 1,960 |
Management fees | 602 | 411 | 1,576 | 901 |
Total rental expenses | $ 28,438 | $ 23,466 | $ 78,436 | $ 61,916 |
OTHER (EXPENSE) INCOME, NET - C
OTHER (EXPENSE) INCOME, NET - Components of Other (Expense) Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Other Income and Expenses [Abstract] | ||||
Interest and investment income | $ 60 | $ 98 | $ 117 | $ 272 |
Income tax expense | (240) | (150) | (640) | (451) |
Total other (expense) income, net | $ (180) | $ (52) | $ (523) | $ (179) |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Mar. 01, 2021 | Mar. 01, 2019 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Related Party Transaction [Line Items] | ||||||
Rental income | $ 105,468 | $ 93,804 | $ 301,470 | $ 262,573 | ||
Investment in WBW CHP LLC (as a percent) | 47.70% | |||||
WBW CHP LLC | ||||||
Related Party Transaction [Line Items] | ||||||
Amount recovered for reimbursements of operating expense for related party | $ 900 | 800 | ||||
American Assets, Inc. | Board of Directors Chairman | ||||||
Related Party Transaction [Line Items] | ||||||
Term of contract (in years) | 10 years | 3 years | ||||
Rental income | $ 200 | $ 200 | 200 | 200 | ||
AAI Aviation, Inc. | Board of Directors Chairman | ||||||
Related Party Transaction [Line Items] | ||||||
Aviation expense | $ 200 | $ 200 |
SEGMENT REPORTING - Narrative (
SEGMENT REPORTING - Narrative (Details) | 9 Months Ended |
Sep. 30, 2022 segment room | |
Segment Reporting [Abstract] | |
Number of operating segments | segment | 4 |
Room in mixed-use segment all-suite hotel | room | 369 |
SEGMENT REPORTING - Operating A
SEGMENT REPORTING - Operating Activity Within Reportable Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Segment Reporting Information [Line Items] | ||||
Segment profit | $ 31,003 | $ 27,669 | $ 87,661 | $ 74,154 |
Total segments’ profit | 71,108 | 65,176 | 204,019 | 180,555 |
Office | ||||
Segment Reporting Information [Line Items] | ||||
Property revenue | 53,250 | 47,433 | 153,412 | 136,467 |
Property expense | (14,551) | (13,016) | (41,944) | (36,029) |
Segment profit | 38,699 | 34,417 | 111,468 | 100,438 |
Retail | ||||
Segment Reporting Information [Line Items] | ||||
Property revenue | 25,694 | 24,541 | 74,873 | 69,296 |
Property expense | (7,807) | (5,745) | (22,965) | (19,922) |
Segment profit | 17,887 | 18,796 | 51,908 | 49,374 |
Multifamily | ||||
Segment Reporting Information [Line Items] | ||||
Property revenue | 14,748 | 13,085 | 42,851 | 38,376 |
Property expense | (6,871) | (6,213) | (19,171) | (17,197) |
Segment profit | 7,877 | 6,872 | 23,680 | 21,179 |
Mixed-use | ||||
Segment Reporting Information [Line Items] | ||||
Property revenue | 17,331 | 13,227 | 45,512 | 29,942 |
Property expense | (10,686) | (8,136) | (28,549) | (20,378) |
Segment profit | $ 6,645 | $ 5,091 | $ 16,963 | $ 9,564 |
SEGMENT REPORTING - Reconciliat
SEGMENT REPORTING - Reconciliation of Segment Profit to Net Income Attributable to Stockholders (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Segment Reporting [Abstract] | ||||||||
Total segments’ profit | $ 71,108 | $ 65,176 | $ 204,019 | $ 180,555 | ||||
General and administrative | (8,376) | (6,827) | (23,130) | (20,574) | ||||
Depreciation and amortization | (31,729) | (30,680) | (93,228) | (85,827) | ||||
Interest expense | (14,454) | (14,722) | (43,667) | (43,589) | ||||
Loss on early extinguishment of debt | 0 | 0 | 0 | (4,271) | ||||
Other (expense) income, net | (180) | (52) | (523) | (179) | ||||
NET INCOME | 16,369 | $ 13,588 | $ 13,514 | 12,895 | $ 11,487 | $ 1,733 | 43,471 | 26,115 |
Net income attributable to restricted shares | (155) | (145) | (464) | (417) | ||||
Net income attributable to unitholders in the Operating Partnership | (3,442) | (2,709) | (9,130) | (5,459) | ||||
Net income attributable to American Assets Trust, Inc. stockholders | $ 12,772 | $ 10,041 | $ 33,877 | $ 20,239 |
SEGMENT REPORTING - Net Real Es
SEGMENT REPORTING - Net Real Estate and Secured Note Payable Balances (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Segment Reporting Information [Line Items] | ||
Real estate, net | $ 2,735,784 | $ 2,681,981 |
Secured Notes Payable | 75,000 | 111,000 |
American Assets Trust, L.P. | ||
Segment Reporting Information [Line Items] | ||
Real estate, net | 2,735,784 | 2,681,981 |
Secured notes payable, net | American Assets Trust, L.P. | ||
Segment Reporting Information [Line Items] | ||
Debt issuance costs | 445 | 35 |
Office | ||
Segment Reporting Information [Line Items] | ||
Real estate, net | 1,610,640 | 1,536,212 |
Secured Notes Payable | 75,000 | 111,000 |
Retail | ||
Segment Reporting Information [Line Items] | ||
Real estate, net | 582,727 | 591,107 |
Multifamily | ||
Segment Reporting Information [Line Items] | ||
Real estate, net | 373,037 | 381,315 |
Mixed-use | ||
Segment Reporting Information [Line Items] | ||
Real estate, net | $ 169,380 | $ 173,347 |
SEGMENT REPORTING - Capital Exp
SEGMENT REPORTING - Capital Expenditures (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Segment Reporting Information [Line Items] | ||||
Capital expenditures | $ 27,155 | $ 21,743 | $ 94,467 | $ 58,797 |
Office | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | 24,107 | 17,601 | 80,824 | 48,471 |
Retail | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | 2,165 | 1,317 | 9,422 | 4,817 |
Multifamily | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | 686 | 2,121 | 3,572 | 4,117 |
Mixed-use | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | $ 197 | $ 704 | $ 649 | $ 1,392 |