Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Aug. 03, 2018 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --12-31 | |
Entity Central Index Key | 1,558,235 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Registrant Name | Corporate Property Associates 18 Global Incorporated | |
Class A | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 113,956,225 | |
Class C | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 31,713,872 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Investments in real estate: | ||
Real estate — Land, buildings and improvements | $ 1,275,023 | $ 1,263,172 |
Operating real estate — Land, buildings and improvements | 568,601 | 566,489 |
Real estate under construction | 195,122 | 134,366 |
Net investments in direct financing leases | 41,648 | 39,957 |
In-place lease intangible assets | 270,957 | 274,723 |
Other intangible assets | 34,967 | 35,811 |
Investments in real estate | 2,386,318 | 2,314,518 |
Accumulated depreciation and amortization | (282,588) | (252,067) |
Net investments in real estate | 2,103,730 | 2,062,451 |
Cash and cash equivalents | 90,971 | 71,068 |
Accounts receivable and other assets, net | 204,242 | 197,478 |
Total assets | 2,398,943 | 2,330,997 |
Debt: | ||
Non-recourse mortgages, net | 1,223,215 | 1,129,432 |
Bonds payable, net | 147,311 | 146,016 |
Debt, net | 1,370,526 | 1,275,448 |
Accounts payable, accrued expenses and other liabilities | 149,808 | 148,031 |
Due to affiliates | 11,780 | 13,767 |
Distributions payable | 21,967 | 21,686 |
Total liabilities | 1,554,081 | 1,458,932 |
Commitments and contingencies (Note 10) | ||
Preferred stock, $0.001 par value; 50,000,000 shares authorized; none issued | 0 | 0 |
Additional paid-in capital | 1,273,685 | 1,257,840 |
Distributions and accumulated losses | (453,823) | (420,005) |
Accumulated other comprehensive loss | (40,749) | (33,212) |
Total stockholders’ equity | 779,257 | 804,764 |
Noncontrolling interests | 65,605 | 67,301 |
Total equity | 844,862 | 872,065 |
Total liabilities and equity | 2,398,943 | 2,330,997 |
Class A common stock | ||
Debt: | ||
Common stock | 113 | 110 |
Class C common stock | ||
Debt: | ||
Common stock | $ 31 | $ 31 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) - $ / shares | Jun. 30, 2018 | Dec. 31, 2017 |
CPA®:18 – Global stockholders’ equity: | ||
Preferred stock, par value (usd per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (shares) | 0 | 0 |
Class A | ||
CPA®:18 – Global stockholders’ equity: | ||
Common stock, par value (usd per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (shares) | 320,000,000 | 320,000,000 |
Common stock, shares outstanding (shares) | 112,849,543 | 111,193,651 |
Class C | ||
CPA®:18 – Global stockholders’ equity: | ||
Common stock, par value (usd per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (shares) | 80,000,000 | 80,000,000 |
Common stock, shares outstanding (shares) | 31,410,984 | 31,189,137 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Lease revenues: | ||||
Rental income | $ 28,456 | $ 24,542 | $ 57,013 | $ 47,902 |
Interest income from direct financing leases | 913 | 906 | 1,831 | 1,880 |
Total lease revenue | 29,369 | 25,448 | 58,844 | 49,782 |
Operating real estate income | 20,309 | 20,316 | 39,972 | 39,696 |
Other operating income | 3,930 | 3,426 | 7,447 | 6,443 |
Other interest income | 1,795 | 1,783 | 3,575 | 3,532 |
Total revenues | 55,403 | 50,973 | 109,838 | 99,453 |
Operating Expenses | ||||
Depreciation and amortization | 16,892 | 18,728 | 34,524 | 37,679 |
Property expenses | 10,190 | 10,209 | 20,024 | 18,418 |
Operating real estate expenses | 8,220 | 8,448 | 16,379 | 16,482 |
General and administrative | 1,800 | 1,752 | 3,445 | 3,481 |
Acquisition and other expenses | 17 | (7) | 17 | 45 |
Operating Expenses | 37,119 | 39,130 | 74,389 | 76,105 |
Other Income and Expenses | ||||
Interest expense | (13,294) | (11,791) | (26,224) | (23,244) |
Other gains and (losses) | (2,072) | 9,459 | 5,920 | 12,121 |
Equity in losses of equity method investment in real estate | (235) | (254) | (559) | (353) |
Other Income and Expenses | (15,601) | (2,586) | (20,863) | (11,476) |
Income before income taxes | 2,683 | 9,257 | 14,586 | 11,872 |
Benefit from (provision for) income taxes | 298 | (1,123) | 713 | (1,193) |
Net Income | 2,981 | 8,134 | 15,299 | 10,679 |
Net income attributable to noncontrolling interests (inclusive of Available Cash Distributions to a related party of $2,830, $2,186, $4,735, and $3,861, respectively) | (3,315) | (2,350) | (5,306) | (4,274) |
Net (Loss) Income Attributable to CPA:18 – Global | (334) | 5,784 | 9,993 | 6,405 |
Class A | ||||
Other Income and Expenses | ||||
Interest expense | (100) | (100) | (100) | (200) |
Net (Loss) Income Attributable to CPA:18 – Global | $ (213) | $ 4,600 | $ 7,901 | $ 5,179 |
Basic and diluted weighted-average shares outstanding (shares) | 113,010,970 | 109,533,769 | 112,564,943 | 108,998,427 |
Basic and diluted income per share (in dollars per share) | $ 0 | $ 0.04 | $ 0.07 | $ 0.05 |
Distributions declared per share (in dollars per share) | $ 0.1563 | $ 0.1563 | $ 0.3126 | $ 0.3126 |
Class C | ||||
Other Income and Expenses | ||||
Net (Loss) Income Attributable to CPA:18 – Global | $ (121) | $ 1,184 | $ 2,092 | $ 1,226 |
Basic and diluted weighted-average shares outstanding (shares) | 31,593,597 | 31,030,596 | 31,517,919 | 30,898,107 |
Basic and diluted income per share (in dollars per share) | $ 0 | $ 0.04 | $ 0.07 | $ 0.04 |
Distributions declared per share (in dollars per share) | $ 0.1378 | $ 0.1382 | $ 0.2753 | $ 0.2762 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Income (Unaudited) (Parentheticals) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Income Statement [Abstract] | ||||
Distributions of available cash | $ 2,830 | $ 2,186 | $ 4,735 | $ 3,861 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net Income | $ 2,981 | $ 8,134 | $ 15,299 | $ 10,679 |
Other Comprehensive (Loss) Income | ||||
Foreign currency translation adjustments | (22,582) | 19,541 | (11,005) | 23,697 |
Realized and unrealized gain (loss) on derivative instruments | 3,418 | (3,824) | 2,759 | (4,281) |
Other Comprehensive (Loss) Income | (19,164) | 15,717 | (8,246) | 19,416 |
Comprehensive (Loss) Income | (16,183) | 23,851 | 7,053 | 30,095 |
Amounts Attributable to Noncontrolling Interests | ||||
Net income | (3,315) | (2,350) | (5,306) | (4,274) |
Foreign currency translation adjustments | 2,326 | (2,265) | 709 | (2,795) |
Comprehensive income attributable to noncontrolling interests | (989) | (4,615) | (4,597) | (7,069) |
Comprehensive (Loss) Income Attributable to CPA:18 – Global | $ (17,172) | $ 19,236 | $ 2,456 | $ 23,026 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Equity (Unaudited) - USD ($) $ in Thousands | Total | Class A | Class C | Total CPA 18 - Global Stockholders | Common StockClass A | Common StockClass C | Additional Paid-In Capital | Distributions and Accumulated Losses | Accumulated Other Comprehensive Loss | Noncontrolling Interests |
Beginning equity balance, value at Dec. 31, 2016 | $ 865,904 | $ 799,899 | $ 107 | $ 30 | $ 1,222,139 | $ (360,673) | $ (61,704) | $ 66,005 | ||
Beginning equity balance, shares at Dec. 31, 2016 | 107,460,081 | 30,469,144 | ||||||||
Statements of Equity | ||||||||||
Shares issued, value | 22,279 | 22,279 | $ 2 | $ 1 | 22,276 | |||||
Shares issued, shares | 2,133,836 | 687,204 | ||||||||
Shares issued to affiliate, value | 5,421 | 5,421 | $ 1 | 5,420 | ||||||
Shares issued to affiliate, shares | 686,096 | |||||||||
Contributions from noncontrolling interests | 3,118 | 3,118 | ||||||||
Distributions to noncontrolling interests | (8,261) | (8,261) | ||||||||
Distributions declared | (42,611) | (42,611) | (42,611) | |||||||
Net Income | 10,679 | 6,405 | 6,405 | 4,274 | ||||||
Other comprehensive (loss) income: | ||||||||||
Foreign currency translation adjustments | 23,697 | 20,902 | 20,902 | 2,795 | ||||||
Realized and unrealized loss on derivative instruments | (4,281) | (4,281) | (4,281) | |||||||
Repurchase of shares, value | (7,349) | (7,349) | $ (1) | $ 0 | (7,348) | |||||
Repurchase of shares, shares | (822,433) | (127,524) | ||||||||
Ending equity balance, value at Jun. 30, 2017 | 868,596 | 800,665 | $ 109 | $ 31 | 1,242,487 | (396,879) | (45,083) | 67,931 | ||
Ending equity balance, shares at Jun. 30, 2017 | 109,457,580 | 31,028,824 | ||||||||
Beginning equity balance, value at Mar. 31, 2017 | (58,535) | |||||||||
Statements of Equity | ||||||||||
Net Income | 8,134 | |||||||||
Other comprehensive (loss) income: | ||||||||||
Foreign currency translation adjustments | 19,541 | |||||||||
Realized and unrealized loss on derivative instruments | (3,824) | |||||||||
Ending equity balance, value at Jun. 30, 2017 | 868,596 | 800,665 | $ 109 | $ 31 | 1,242,487 | (396,879) | (45,083) | 67,931 | ||
Ending equity balance, shares at Jun. 30, 2017 | 109,457,580 | 31,028,824 | ||||||||
Beginning equity balance, value at Dec. 31, 2017 | 872,065 | 804,764 | $ 110 | $ 31 | 1,257,840 | (420,005) | (33,212) | 67,301 | ||
Beginning equity balance, shares at Dec. 31, 2017 | 111,193,651 | 31,189,137 | 111,193,651 | 31,189,137 | ||||||
Statements of Equity | ||||||||||
Shares issued, value | 22,015 | 22,015 | $ 2 | $ 1 | 22,012 | |||||
Shares issued, shares | 2,008,147 | 625,174 | ||||||||
Shares issued to affiliate, value | 5,971 | 5,971 | $ 1 | 5,970 | ||||||
Shares issued to affiliate, shares | 711,157 | |||||||||
Contributions from noncontrolling interests | 1,174 | 1,174 | ||||||||
Distributions to noncontrolling interests | (7,467) | (7,467) | ||||||||
Distributions declared | (43,811) | (43,811) | (43,811) | |||||||
Net Income | 15,299 | 9,993 | 9,993 | 5,306 | ||||||
Other comprehensive (loss) income: | ||||||||||
Foreign currency translation adjustments | (11,005) | (10,296) | (10,296) | (709) | ||||||
Realized and unrealized loss on derivative instruments | 2,759 | 2,759 | 2,759 | |||||||
Repurchase of shares, value | (12,138) | (12,138) | $ 0 | $ (1) | (12,137) | |||||
Repurchase of shares, shares | (1,063,412) | (403,327) | ||||||||
Ending equity balance, value at Jun. 30, 2018 | 844,862 | 779,257 | $ 113 | $ 31 | 1,273,685 | (453,823) | (40,749) | 65,605 | ||
Ending equity balance, shares at Jun. 30, 2018 | 112,849,543 | 31,410,984 | 112,849,543 | 31,410,984 | ||||||
Beginning equity balance, value at Mar. 31, 2018 | (23,911) | |||||||||
Statements of Equity | ||||||||||
Net Income | 2,981 | |||||||||
Other comprehensive (loss) income: | ||||||||||
Foreign currency translation adjustments | (22,582) | |||||||||
Realized and unrealized loss on derivative instruments | 3,418 | |||||||||
Ending equity balance, value at Jun. 30, 2018 | $ 844,862 | $ 779,257 | $ 113 | $ 31 | $ 1,273,685 | $ (453,823) | $ (40,749) | $ 65,605 | ||
Ending equity balance, shares at Jun. 30, 2018 | 112,849,543 | 31,410,984 | 112,849,543 | 31,410,984 |
Condensed Consolidated Stateme8
Condensed Consolidated Statements of Equity (Unaudited) (Parentheticals) - $ / shares | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Class A | ||
Statements of Equity | ||
Distributions declared per share (in dollars per share) | $ 0.3126 | $ 0.3126 |
Class C | ||
Statements of Equity | ||
Distributions declared per share (in dollars per share) | 0.2753 | 0.2762 |
Common Stock | Class A | ||
Statements of Equity | ||
Distributions declared per share (in dollars per share) | 0.3126 | 0.3126 |
Common Stock | Class C | ||
Statements of Equity | ||
Distributions declared per share (in dollars per share) | $ 0.2753 | $ 0.2762 |
Condensed Consolidated Stateme9
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Cash Flows — Operating Activities | ||
Net Cash Provided by Operating Activities | $ 44,960 | $ 43,091 |
Cash Flows — Investing Activities | ||
Funding and advances for build-to-suit projects | (44,941) | (30,497) |
Acquisitions of real estate, build-to-suit projects and direct financing leases | (37,985) | (27,331) |
Proceeds from insurance settlements | 7,074 | 3,895 |
Capital expenditures on real estate | (7,033) | (5,458) |
Value added taxes refunded in connection with the acquisitions of real estate | 3,374 | 12,050 |
Value added taxes paid in connection with acquisitions of real estate | (3,290) | (2,491) |
Proceeds from repayment of notes receivable | 2,546 | 0 |
Payment of deferred acquisition fees to an affiliate | (2,238) | (2,854) |
Proceeds from sale of real estate | 771 | 0 |
Other investing activities, net | 12 | (39) |
Capital contributions to equity investment | (6) | (5,616) |
Return of capital from equity investments | 0 | 236 |
Net Cash Used in Investing Activities | (81,716) | (58,105) |
Cash Flows — Financing Activities | ||
Proceeds from mortgage financing | 128,010 | 32,613 |
Distributions paid | (43,530) | (42,210) |
Scheduled payments and prepayments of mortgage principal | (22,654) | (6,323) |
Proceeds from issuance of shares | 20,970 | 21,175 |
Repurchase of shares | (12,138) | (7,349) |
Distributions to noncontrolling interests | (7,467) | (8,261) |
Contributions from noncontrolling interests | 1,174 | 2,339 |
Payment of deferred financing costs and mortgage deposits | (965) | (526) |
Other financing activities, net | 540 | (43) |
Proceeds from notes payable to affiliate | 0 | 11,196 |
Repayment of notes payable to affiliate | 0 | (4,495) |
Net Cash Provided by (Used in) Financing Activities | 63,940 | (1,884) |
Change in Cash and Cash Equivalents and Restricted Cash During the Period | ||
Effect of exchange rate changes on cash and cash equivalents and restricted cash | (2,690) | 2,776 |
Net increase (decrease) in cash and cash equivalents and restricted cash | 24,494 | (14,122) |
Cash and cash equivalents and restricted cash, beginning of period | 90,183 | 93,741 |
Cash and cash equivalents and restricted cash, end of period | $ 114,677 | $ 79,619 |
Organization
Organization | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization Organization Corporate Property Associates 18 – Global Incorporated, or CPA:18 – Global, and, together with its consolidated subsidiaries, we, us, or our, is a publicly owned, non-traded REIT, that invests primarily in a diversified portfolio of income-producing commercial real estate properties leased to companies and other real estate related assets, both domestically and internationally. We were formed in 2012 and are managed by W. P. Carey Inc., or WPC, through one of its subsidiaries, or collectively, our Advisor. As a REIT, we are not subject to U.S. federal income taxation as long as we satisfy certain requirements, principally relating to the nature of our income and the level of our distributions, among other factors. We earn revenue primarily by leasing the properties we own to single corporate tenants, predominantly on a triple-net lease basis, which requires the tenant to pay substantially all of the costs associated with operating and maintaining the property. Revenue is subject to fluctuation due to the timing of new lease transactions, lease terminations, lease expirations, contractual rent adjustments, tenant defaults, sales of properties, and changes in foreign currency exchange rates. Substantially all of our assets and liabilities are held by CPA:18 Limited Partnership, or the Operating Partnership, and at June 30, 2018 we owned 99.97% of general and limited partnership interests in the Operating Partnership. The remaining interest in the Operating Partnership is held by a subsidiary of WPC. At June 30, 2018 , our portfolio was comprised of full or partial ownership interests in 59 properties, substantially all of which were fully-occupied and triple-net leased to 100 tenants totaling 10.2 million square feet. The remainder of our portfolio was comprised of our full or partial ownership interests in 69 self-storage properties and 14 multi-family and student-housing properties totaling 6.7 million square feet. We operate in three reportable business segments: Net Lease, Self Storage, and Multi-Family. Our Net Lease segment includes our investments in net-leased properties, whether they are accounted for as operating leases or direct financing leases. Our Self Storage segment is comprised of our investments in self-storage properties. Our Multi-Family segment is comprised of our investments in six multi-family residential properties and eight student-housing developments. In addition, we have an All Other category that includes our notes receivable investments ( Note 12 ). Our reportable business segments and All Other category are the same as our reporting units. We raised aggregate gross proceeds in our initial public offering of approximately $1.2 billion through April 2, 2015, which is the date we closed our offering. We have fully invested the proceeds from our initial public offering. In addition, from inception through June 30, 2018 , $133.6 million and $37.0 million of distributions to our shareholders were reinvested in our Class A and Class C common stock, respectively, through our Distribution Reinvestment Plan, or DRIP. |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Basis of Presentation Our interim condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and, therefore, do not necessarily include all information and footnotes necessary for a fair statement of our consolidated financial position, results of operations, and cash flows in accordance with generally accepted accounting principles in the United States, or GAAP. The year-end condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. In the opinion of management, the unaudited financial information for the interim periods presented in this Report reflects all normal and recurring adjustments necessary for a fair statement of financial position, results of operations, and cash flows. Our interim condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and accompanying notes for the year ended December 31, 2017 , which are included in the 2017 Annual Report, as certain disclosures that would substantially duplicate those contained in the audited consolidated financial statements have not been included in this Report. Operating results for interim periods are not necessarily indicative of operating results for an entire year. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and the disclosure of contingent amounts in our condensed consolidated financial statements and the accompanying notes. Actual results could differ from those estimates. Basis of Consolidation Our condensed consolidated financial statements reflect all of our accounts, including those of our controlled subsidiaries. The portions of equity in consolidated subsidiaries that are not attributable, directly or indirectly, to us are presented as noncontrolling interests. All significant intercompany accounts and transactions have been eliminated. When we obtain an economic interest in an entity, we evaluate the entity to determine if it should be deemed a variable interest entity, or VIE, and, if so, whether we are the primary beneficiary and are therefore required to consolidate the entity. We apply accounting guidance for consolidation of VIEs to certain entities in which the equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. Fixed price purchase and renewal options within a lease, as well as certain decision-making rights within a loan or joint-venture agreement, can cause us to consider an entity a VIE. Limited partnerships and other similar entities that operate as a partnership will be considered VIEs unless the limited partners hold substantive kick-out rights or participation rights. Significant judgment is required to determine whether a VIE should be consolidated. We review the contractual arrangements provided for in the partnership agreement or other related contracts to determine whether the entity is considered a VIE and to establish whether we have any variable interests in the VIE. We then compare our variable interests, if any, to those of the other variable interest holders to determine which party is the primary beneficiary of the VIE based on whether the entity (i) has the power to direct the activities that most significantly impact the economic performance of the VIE and (ii) has the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. The liabilities of these VIEs are non-recourse to us and can only be satisfied from each VIE’s respective assets. At June 30, 2018 , we considered 16 entities to be VIEs, 15 of which we consolidated as we are considered the primary beneficiary. At December 31, 2017 , we considered 12 entities to be VIEs, 11 of which we consolidated. The following table presents a summary of selected financial data of the consolidated VIEs included in the condensed consolidated balance sheets (in thousands): June 30, 2018 December 31, 2017 Real estate — Land, buildings and improvements $ 370,439 $ 373,954 Real estate under construction 171,872 107,732 In-place lease intangible assets 87,185 88,617 Other intangible assets 17,536 18,040 Accumulated depreciation and amortization (61,354 ) (54,592 ) Cash and cash equivalents 10,585 5,030 Accounts receivable and other assets, net 34,167 33,219 Total assets 630,430 572,000 Non-recourse mortgages, net $ 255,406 $ 218,267 Bonds payable, net 60,945 60,577 Accounts payable, accrued expenses and other liabilities 52,637 46,858 Total liabilities 368,988 325,702 At both June 30, 2018 and December 31, 2017 , we had one unconsolidated VIE, which we account for under the equity method of accounting. We do not consolidate this entity because we are not the primary beneficiary and the nature of our involvement in the activities of the entity allows us to exercise significant influence on, but does not give us power over, decisions that significantly affect the economic performance of the entity. As of June 30, 2018 and December 31, 2017 , the net carrying amount of this equity investment was $19.6 million and $20.9 million , respectively, and our maximum exposure to loss in this entity is limited to our investment. At times, the carrying value of our equity investment may fall below zero for certain investments. We intend to fund our share of the jointly owned investment’s future operating deficits should the need arise. However, we have no legal obligation to pay for any of the liabilities of such investments nor do we have any legal obligation to fund the operating deficits. At both June 30, 2018 and December 31, 2017 , our sole equity investment did not have a carrying value below zero. Accounting Policy Update Distributions from Equity Method Investments — We classify distributions received from equity method investments using the cumulative earnings approach. Distributions received are considered returns on the investment and classified as cash inflows from operating activities. If, however, the investor’s cumulative distributions received, less distributions received in prior periods determined to be returns of investment, exceeds cumulative equity in earnings recognized, the excess is considered a return of investment and is classified as cash inflows from investing activities. Reclassifications Certain prior period amounts have been reclassified to conform to the current period presentation. In the second quarter of 2018, we reclassified notes receivable, equity investment in real estate, and goodwill to be included within Accounts receivable and other assets, net in our condensed consolidated balance sheets. Additionally, we reclassified deferred income taxes to be included within Accounts payable, accrued expenses and other liabilities in our condensed consolidated balance sheets. Prior period balances have been reclassified to conform to the current period presentation. The following table presents a summary of amounts included in Accounts receivable and other assets, net in the condensed consolidated financial statements (in thousands): June 30, 2018 December 31, 2017 Accounts receivable and other assets, net Notes receivable ( Note 5 ) $ 63,954 $ 66,500 Accounts receivable, net 33,249 32,572 Goodwill ( Note 6 ) 27,562 26,084 Restricted cash 23,706 19,115 Equity investment in real estate ( Note 4 ) 19,594 20,919 Prepaid expenses 14,484 13,496 Other assets 21,693 18,792 $ 204,242 $ 197,478 The following table presents a summary of amounts included in Accounts payable, accrued expenses and other liabilities in the condensed consolidated financial statements (in thousands): June 30, 2018 December 31, 2017 Accounts payable, accrued expenses and other liabilities Deferred income taxes $ 61,619 $ 63,980 Accounts payable and accrued expenses 40,769 39,626 Deferred revenue 13,622 11,975 Intangible liabilities, net ( Note 6 ) 10,393 11,009 Other liabilities 23,405 21,441 $ 149,808 $ 148,031 Restricted Cash — In connection with our adoption of Accounting Standards Update, or ASU, 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash , as described below, we revised our condensed consolidated statements of cash flows to include restricted cash when reconciling the beginning-of-period and end-of-period cash amounts shown on the statement of cash flows. As a result, we retrospectively revised prior periods presented to conform to the current period presentation. Restricted cash primarily consists of security deposits and amounts required to be reserved pursuant to lender agreements for debt service, capital improvements, and real estate taxes. The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the condensed consolidated balance sheets to the condensed consolidated statements of cash flows (in thousands): June 30, 2018 December 31, 2017 Cash and cash equivalents $ 90,971 $ 71,068 Restricted cash (a) 23,706 19,115 Total cash and cash equivalents and restricted cash $ 114,677 $ 90,183 __________ (a) Restricted cash is included within Accounts receivable and other assets, net on our condensed consolidated balance sheets. Recent Accounting Pronouncements Pronouncements Adopted as of June 30, 2018 In May 2014, the Financial Accounting Standards Board, or FASB, issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) . ASU 2014-09 is a comprehensive new revenue recognition model requiring a company to recognize revenue to depict the transfer of goods or services to a customer at an amount reflecting the consideration it expects to receive in exchange for those goods or services. ASU 2014-09 does not apply to our lease revenues, which constitute a majority of our revenues, but will primarily apply to revenues generated from our operating properties. We adopted this guidance for our interim and annual periods beginning January 1, 2018 using the modified retrospective transition method applied to any contracts not completed as of that date. There were no changes to the prior period presentations of revenue. Results of operations for reporting periods beginning January 1, 2018 are presented under Topic 606. The adoption of Topic 606 did not have a material impact on our condensed consolidated financial statements. Revenue is recognized when, or as, control of promised goods or services is transferred to customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. At contract inception, we assess the services promised in our contracts with customers and identify a performance obligation for each promise to transfer to the customer a good or service (or bundle of goods or services) that is distinct. To identify the performance obligations, we consider all of the services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices. In January 2016, the FASB issued ASU 2016-01, Financial Instruments — Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities . ASU 2016-01 requires all equity investments (other than those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value, with changes in the fair value recognized through net income. We adopted this guidance for our interim and annual periods beginning January 1, 2018. The adoption of ASU 2016-01 did not have a material impact on our condensed consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 intends to reduce diversity in practice for certain cash flow classifications, including, but not limited to (i) debt prepayment or debt extinguishment costs, (ii) contingent consideration payments made after a business combination, (iii) proceeds from the settlement of insurance claims, and (iv) distributions received from equity method investees. We retrospectively adopted this guidance for our interim and annual periods beginning January 1, 2018. The adoption of ASU 2016-15 did not have a material impact on our condensed consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash . ASU 2016-18 intends to reduce diversity in practice for the classification and presentation of changes in restricted cash on the statement of cash flows. ASU 2016-18 requires that the statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. We retrospectively adopted this guidance for our interim and annual periods beginning January 1, 2018. See Restricted Cash above for additional information. In February 2017, the FASB issued ASU 2017-05, Other Income — Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20 ): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets . ASU 2017-05 clarifies the scope and application of Accounting Standards Codification, or ASC, 610-20 on the sale or transfer of nonfinancial assets and in substance nonfinancial assets to non-customers, including partial sales. Nonfinancial assets within the scope of this Subtopic include the sale of land, buildings and intangible assets. ASU 2017-05 further clarifies that a financial asset is within the scope of Subtopic 610-20 if it meets the definition of an in substance nonfinancial asset. The amendments define the term “in substance nonfinancial asset,” in part, as a financial asset promised to a counterparty in a contract if substantially all of the fair value of the assets (recognized and unrecognized) that are promised to the counterparty in the contract is concentrated in nonfinancial assets. This amendment also clarifies that nonfinancial assets within the scope of Subtopic 610-20 may include nonfinancial assets transferred within a legal entity to a counterparty. For example, a parent company may transfer control of nonfinancial assets by transferring ownership interests in a consolidated subsidiary. We adopted this guidance for our interim and annual periods beginning January 1, 2018 and applied the modified retrospective transition method (applicable to any contracts not completed as of that date). The adoption of ASU 2017-05 did not have a material impact on our condensed consolidated financial statements. Pronouncements to be Adopted after June 30, 2018 In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . ASU 2016-02 modifies the principles for the recognition, measurement, presentation, and disclosure of leases for both parties to a contract, the lessee and the lessor. ASU 2016-02 provides new guidelines that change the accounting for leasing arrangements for lessees, whereby their rights and obligations under substantially all leases, existing and new, would be capitalized and recorded on the balance sheet. For lessors, however, the accounting remains largely equivalent to the current model, with the distinction between operating, sales-type, and direct financing leases retained, but updated to align with certain changes to the lessee model and the new revenue recognition standard. ASU 2016-02 also replaces existing sale-leaseback guidance with a new model that requires symmetrical accounting between the seller-lessee and buyer-lessor. Additionally, ASU 2016-02 requires lessors to record costs paid directly by a lessee on behalf of a lessor (e.g., real estate taxes and insurance costs) on a gross basis and will require extensive quantitative and qualitative disclosures. Early application is permitted for all entities. ASU 2016-02 provides two transition methods. The first transition method allows for application of the new model at the beginning of the earliest comparative period presented. Under the second transition method, comparative periods would not be restated, with any cumulative effect adjustments recognized in the opening balance of retained earnings in the period of adoption. In addition, a practical expedient was recently issued by the FASB, which allows lessors to combine non-lease components with related lease components if certain conditions are met. Further, in March 2018, the FASB approved, but has not yet finalized or issued, an update to allow lessors to make a policy election to record certain costs (e.g., insurance) paid directly by the lessee net, if the uncertainty regarding these variable amounts is not expected to ultimately be resolved. We will adopt this guidance for our interim and annual periods beginning January 1, 2019 and expect to use the second transition method. ASU 2016-02 is expected to impact our condensed consolidated financial statements as we have certain operating office and land lease arrangements for which we are the lessee and also certain lease arrangements that include common area maintenance services (non-lease components) where we are the lessor. We are evaluating the impact of ASU 2016-02 and have not yet determined if it will have a material impact on our business or our condensed consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses. ASU 2016-13 introduces a new model for estimating credit losses based on current expected credit losses for certain types of financial instruments, including loans receivable, held-to-maturity debt securities, and net investments in direct financing leases, amongst other financial instruments. ASU 2016-13 also modifies the impairment model for available-for-sale debt securities and expands the disclosure requirements regarding an entity’s assumptions, models, and methods for estimating the allowance for losses. ASU 2016-13 will be effective for public business entities in fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, with early application of the guidance permitted. We are in the process of evaluating the impact of adopting ASU 2016-13 on our condensed consolidated financial statements. In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities . ASU 2017-12 will make more financial and nonfinancial hedging strategies eligible for hedge accounting. It also amends the presentation and disclosure requirements and changes how companies assess hedge effectiveness. It is intended to more closely align hedge accounting with companies’ risk management strategies, simplify the application of hedge accounting, and increase transparency as to the scope and results of hedging programs. ASU 2017-12 will be effective in fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. We are in the process of evaluating the impact of adopting ASU 2017-12 on our condensed consolidated financial statements, and will adopt the standard for the fiscal year beginning January 1, 2019. |
Agreements and Transactions wit
Agreements and Transactions with Related Parties | 6 Months Ended |
Jun. 30, 2018 | |
Related Party Transactions [Abstract] | |
Agreements and Transactions with Related Parties | Agreements and Transactions with Related Parties Transactions with Our Advisor We have an advisory agreement with our Advisor whereby our Advisor performs certain services for us under a fee arrangement, including the identification, evaluation, negotiation, purchase, and disposition of real estate and related assets and mortgage loans; day-to-day management; and the performance of certain administrative duties. We also reimburse our Advisor for general and administrative duties performed on our behalf. The advisory agreement has a term of one year and may be renewed for successive one-year periods. We may terminate the advisory agreement upon 60 days’ written notice without cause or penalty. The following tables present a summary of fees we paid, expenses we reimbursed, and distributions we made to our Advisor and other affiliates (which excludes the annual distribution and shareholder servicing fee that impacts equity as further disclosed below the tables), in accordance with the terms of the relevant agreements (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Amounts Included in the Condensed Consolidated Statements of Operations Asset management fees $ 3,151 $ 2,767 $ 6,025 $ 5,476 Available Cash Distributions 2,830 2,186 4,735 3,861 Personnel and overhead reimbursements 716 787 1,433 1,569 Director compensation 40 53 80 105 Interest expense on deferred acquisition fees, affiliate loan, and accretion of interest on annual distribution and shareholder servicing fee (a) 20 319 (42 ) 620 $ 6,757 $ 6,112 $ 12,231 $ 11,631 Advisor Fees Capitalized Current acquisition fees $ 2,379 $ — $ 3,100 $ 1,393 Deferred acquisition fees 1,903 — 2,480 1,114 Capitalized personnel and overhead reimbursements 259 2 371 184 $ 4,541 $ 2 $ 5,951 $ 2,691 __________ (a) For the three and six months ended June 30, 2018 interest on the annual distribution and shareholder servicing fee is excluded as it is paid directly to selected dealers rather than through Carey Financial LLC, or Carey Financial, as discussed further below. The following table presents a summary of amounts included in Due to affiliates in the condensed consolidated financial statements (in thousands): June 30, 2018 December 31, 2017 Due to Affiliates Deferred acquisition fees, including accrued interest $ 5,786 $ 6,693 Accounts payable and other 3,316 6,102 Current acquisition fees 1,652 — Asset management fees payable 1,026 972 $ 11,780 $ 13,767 Loans from WPC In July 2016, our board of directors and the board of directors of WPC approved unsecured loans from WPC to us, at the sole discretion of WPC’s management, of up to $50.0 million in the aggregate, at a rate equal to the rate at which WPC can borrow funds under its senior credit facility, for acquisition funding purposes. As of June 30, 2018 and December 31, 2017 , we had no loans outstanding to WPC. Asset Management Fees Pursuant to the advisory agreement, our Advisor is entitled to an annual asset management fee ranging from 0.5% to 1.5% , depending on the type of investment and based on the average market value or average equity value, as applicable, of our investments. Asset management fees are payable in cash and/or shares of our Class A common stock at our option, after consultation with our Advisor. If our Advisor receives all or a portion of its fees in shares, the number of shares issued is determined by dividing the dollar amount of fees by our most recently published estimated net asset value per share, or NAV, per Class A share, which was $8.57 as of March 31, 2018. For the three and six months ended June 30, 2018 and the year ended December 31, 2017 , our Advisor received its asset management fees in shares of our Class A common stock. At June 30, 2018 , our Advisor owned 4,327,814 shares, or 3.0% , of our outstanding Class A common stock. Asset management fees are included in Property expenses in the condensed consolidated financial statements. Annual Distribution and Shareholder Servicing Fee Through June 30, 2017, Carey Financial, the wholly-owned subsidiary of our Advisor that was a registered broker-dealer, was entitled to receive an annual distribution and shareholder servicing fee from us in connection with our Class C common stock, which it may have re-allowed to selected dealers. Beginning with the payment for the third quarter of 2017 (paid during the first month of the fourth quarter of 2017) the annual distribution and shareholder servicing fees are paid directly to selected dealers rather than through Carey Financial. The amount of the annual distribution and shareholder servicing fee is 1.0% of the most recently published NAV of our Class C common stock. The annual distribution and shareholder servicing fee accrues daily and is payable quarterly in arrears. We will no longer incur the annual distribution and shareholder servicing fee beginning on the date at which, in the aggregate, underwriting compensation from all sources reaches 10.0% of the gross proceeds from our initial public offering, which it had not yet reached as of June 30, 2018 . At June 30, 2018 and December 31, 2017 , we recorded a liability of $4.8 million and $5.7 million , respectively, within Accounts payable, accrued expenses and other liabilities in the condensed consolidated financial statements. Acquisition and Disposition Fees Our Advisor receives acquisition fees, a portion of which is payable upon acquisition, while the remaining portion is subordinated to a preferred return of a non-compounded cumulative distribution of 5.0% per annum (based initially on our invested capital). The initial acquisition fee and subordinated acquisition fee are 2.5% and 2.0% , respectively, of the aggregate total cost of our portion of each investment for all investments, other than those in readily marketable real estate securities purchased in the secondary market, for which our Advisor will not receive any acquisition fees. Deferred acquisition fees are scheduled to be paid in three equal annual installments following the quarter in which a property was purchased and are subject to the preferred return described above. The preferred return was achieved as of the periods ended June 30, 2018 and December 31, 2017 . Unpaid installments of deferred acquisition fees are included in Due to affiliates in the condensed consolidated financial statements and bear interest at an annual rate of 2.0% . The cumulative total acquisition costs, including acquisition fees paid to the advisor, may not exceed 6.0% of the aggregate contract purchase price of all investments, which is measured at the end of each year. During the year ended December 31, 2017 , we overpaid acquisition fees to our Advisor totaling $0.7 million , and as a result, we recorded a reimbursement receivable from our Advisor for this amount and included it within Accounts receivable and other assets, net in our condensed consolidated financial statements. This amount was repaid to us during the period ended June 30, 2018. In addition, our Advisor may be entitled to receive a disposition fee equal to the lesser of (i) 50.0% of the competitive real estate commission (as defined in the advisory agreement) or (ii) 3.0% of the contract sales price of the investment being sold. These fees are paid at the discretion of our board of directors. Personnel and Overhead Reimbursements Under the terms of the advisory agreement, our Advisor allocates a portion of its personnel and overhead expenses to us and the other entities that are managed by WPC and its affiliates, including Corporate Property Associates 17 – Global, Carey Watermark Investors Incorporated, Carey Watermark Investors 2 Incorporated, and Carey European Housing Fund I L.P., which are collectively referred to as the Managed Programs. Our Advisor also allocated a portion of its personnel and overhead expenses to Carey Credit Income Fund (now known as Guggenheim Credit Income Fund) prior to September 11, 2017, which was the effective date of its resignation as the advisor to that fund. Our Advisor allocates these expenses to us on the basis of our trailing four quarters of reported revenues in comparison to those of WPC and other entities managed by WPC and its affiliates. We reimburse our Advisor for various expenses it incurs in the course of providing services to us. We reimburse certain third-party expenses paid by our Advisor on our behalf, including property-specific costs, professional fees, office expenses, and business development expenses. In addition, we reimburse our Advisor for the allocated costs of personnel and overhead in managing our day-to-day operations, including accounting services, stockholder services, corporate management, and property management and operations. We do not reimburse our Advisor for the cost of personnel if these personnel provide services for transactions for which our Advisor receives a transaction fee, such as for acquisitions and dispositions. Under the advisory agreement, the amount of applicable personnel costs allocated to us is capped at 1.0% and 2.0% for 2018 and 2017, respectively, of pro rata lease revenues for each year. Costs related to our Advisor’s legal transactions group are based on a schedule of expenses relating to services performed for different types of transactions, such as financing, lease amendments, and dispositions, among other categories, and includes 0.25% of the total investment cost of an acquisition. In general, personnel and overhead reimbursements are included in General and administrative expenses in the condensed consolidated financial statements. However, we capitalize certain of the costs related to our Advisor’s legal transactions group if the costs relate to a transaction that is not considered to be a business combination. Excess Operating Expenses Our Advisor is obligated to reimburse us for the amount by which our operating expenses exceeds the “ 2% / 25% guidelines” (the greater of 2% of average invested assets or 25% of net income) as defined in the advisory agreement for any 12-month period, subject to certain conditions. For the most recent trailing four quarters, our operating expenses were below this threshold. Available Cash Distributions WPC’s interest in the Operating Partnership entitles it to receive distributions of up to 10.0% of the available cash generated by the Operating Partnership, referred to as the Available Cash Distribution, which is defined as cash generated from operations, excluding capital proceeds, as reduced by operating expenses and debt service, excluding prepayments and balloon payments. Available Cash Distributions are included in Net income attributable to noncontrolling interests in the condensed consolidated financial statements. Jointly Owned Investments and Other Transactions with our Affiliates At June 30, 2018 , we owned interests ranging from 50% to 99% in jointly owned investments, with the remaining interests held by affiliates or by third parties. We consolidate all of these joint ventures with exception to our sole equity investment ( Note 4 ), which we account for under the equity method of accounting. Additionally, no other parties hold any rights that overcome our control. We account for the minority share of these investments as noncontrolling interests. |
Real Estate, Operating Real Est
Real Estate, Operating Real Estate, Real Estate Under Construction, and Equity Investment in Real Estate | 6 Months Ended |
Jun. 30, 2018 | |
Real Estate [Abstract] | |
Real Estate, Operating Real Estate, Real Estate Under Construction, and Equity Investment in Real Estate | Real Estate, Operating Real Estate, Real Estate Under Construction, and Equity Investment in Real Estate Real Estate — Land, Buildings and Improvements Real estate, which consists of land and buildings leased to others, and which are subject to operating leases, is summarized as follows (in thousands): June 30, 2018 December 31, 2017 Land $ 204,198 $ 202,500 Buildings and improvements 1,070,825 1,060,672 Less: Accumulated depreciation (101,331 ) (87,886 ) $ 1,173,692 $ 1,175,286 During the six months ended June 30, 2018 , the U.S. dollar strengthened against the euro, as the end-of-period rate for the U.S. dollar in relation to the euro decreased by 2.8% to $1.1658 from $1.1993 . As a result, the carrying value of our Real estate — land, buildings and improvements decreased by $17.5 million from December 31, 2017 to June 30, 2018 . Depreciation expense, including the effect of foreign currency translation, on our real estate was $7.9 million and $6.7 million for the three months ended June 30, 2018 and 2017 , respectively, and $15.8 million and $13.0 million for the six months ended June 30, 2018 and 2017 , respectively. Operating Real Estate — Land, Buildings and Improvements Operating real estate, which consists of our self-storage and multi-family properties, is summarized as follows (in thousands): June 30, 2018 December 31, 2017 Land $ 98,432 $ 98,429 Buildings and improvements 470,169 468,060 Less: Accumulated depreciation (52,409 ) (43,786 ) $ 516,192 $ 522,703 Depreciation expense on our operating real estate was $4.3 million and $4.5 million for the three months ended June 30, 2018 and 2017 , respectively, and $8.7 million and $8.9 million for the six months ended June 30, 2018 and 2017 , respectively. Real Estate Under Construction The following table provides the activity of our Real estate under construction (in thousands): Six Months Ended June 30, 2018 Beginning balance $ 134,366 Capitalized funds 87,646 Placed into service (25,900 ) Foreign currency translation adjustments (3,498 ) Capitalized interest 2,508 Ending balance $ 195,122 Capitalized Funds We entered into the following build-to-suit investments during the six months ended June 30, 2018 (amounts based on the exchange rate of the euro on the date of acquisition): • $10.5 million to enter into a build-to-suit joint venture with a third party for a student-housing development site located in Barcelona, Spain on March 8, 2018 . We acquired 99% of the equity in this investment at closing. This property is under construction and is currently projected to be completed in September 2019, at which point our total investment is expected to be approximately $28.5 million . Since we are responsible for substantially all of the economics but we proportionally have less voting rights, this investment is considered to be a VIE that we consolidate ( Note 2 ); • $9.3 million to enter into a build-to-suit joint venture with a third party for a student-housing development site located in Coimbra, Portugal on June 11, 2018. We acquired 99% of the equity in this investment at closing. This property is under construction and is currently projected to be completed in September 2019, at which point our total investment is expected to be approximately $26.3 million . Since we are responsible for substantially all of the economics but we proportionally have less voting rights, this investment is considered to be a VIE that we consolidate ( Note 2 ); • $13.1 million to enter into a build-to-suit project for a student-housing development site located in San Sebastian, Spain on June 14, 2018. This property is under construction and is currently projected to be completed in September 2020, at which point our total investment is expected to be approximately $36.7 million . As there is insufficient equity at risk, the investment is considered to be a VIE ( Note 2 ); and • $13.1 million to enter into a build-to-suit project for a student-housing development site located in Barcelona, Spain on June 25, 2018. This property is under construction and is currently projected to be completed in September 2020, at which point our total investment is expected to be approximately $31.7 million . As there is insufficient equity at risk, the investment is considered to be a VIE ( Note 2 ). Ghana — On February 19, 2016, we entered into a build-to-suit joint venture with a third party for a university complex development site located in Accra, Ghana. As of June 30, 2018 , total capitalized funds related to this investment were $32.5 million , inclusive of accrued construction costs of $0.9 million and the effect of recording deferred tax liabilities of $3.7 million . At the time of the investment, the joint venture entered into an agreement for third-party financing in an amount up to $41.0 million from the Overseas Private Investment Corporation, or OPIC, a developmental finance institution of the U.S. Government, with an estimated interest rate based on the U.S. Treasury rate plus 300 basis points. The transaction, including the funding of this loan, was subject to the tenant obtaining a letter of credit, which did not occur, and as a result the tenant was in default under its concession agreement with us. Because of the tenant’s default, we terminated the concession agreement in May 2018 , and therefore we will not pursue the completion of this project. We are currently pursuing appropriate remedies, including payment from the tenant or through our insurance policy. We had no amounts outstanding under this financing arrangement at June 30, 2018 . We have evaluated this investment for impairment and probability-weighted different scenarios in estimating future undiscounted cash flows, including payment from the tenant or through our insurance policy. Because we believe there is a high probability that we will recover the full amount invested, we have not recorded any impairment charge in connection with this investment as of June 30, 2018 , although recovery may take additional time. We will continue to monitor this investment for impairment. During the six months ended June 30, 2018 , total capitalized funds primarily related to our build-to-suit projects, which were comprised principally of initial funding of $47.9 million and construction draws of $39.7 million . Capitalized funds include accrued costs of $2.5 million , which is a non-cash investing activity. Capitalized Interest Capitalized interest includes amortization of the mortgage discount and deferred financing costs and interest incurred during construction, which totaled $2.5 million during the six months ended June 30, 2018 and is a non-cash investing activity. Placed into Service During the six months ended June 30, 2018 , a total of $25.9 million was placed into service and reclassified to Real estate — land, buildings and improvements, principally related to the remaining portion of a substantially completed hotel, which is a non-cash investing activity. Ending Balance At June 30, 2018 , we had eight open build-to-suit projects with aggregate unfunded commitments of approximately $181.7 million , excluding capitalized interest, accrued costs, and capitalized acquisition fees for our Advisor. Equity Investment in Real Estate We have an interest in an unconsolidated investment in our Self Storage segment that relates to a joint venture for the development of four self-storage facilities in Canada. This investment is jointly owned with a third party, which is also the general partner. Our ownership interest in the joint venture is 90% . As of June 30, 2018 , the joint-venture partner had not purchased its 10% equity interest, which will be funded by the distributions it is eligible to receive upon properties being placed into service. We do not consolidate this entity because we are not the primary beneficiary and the nature of our involvement in the activities of the entity allows us to exercise significant influence but does not give us power over decisions that significantly affect the economic performance of the entity. At June 30, 2018 and December 31, 2017 , our total equity investment balance for these properties was $19.6 million and $20.9 million , respectively, which is included in Accounts receivable and other assets, net in the condensed consolidated financial statements. At June 30, 2018 and December 31, 2017 , the joint venture had total third-party recourse debt of $23.3 million and $21.5 million , respectively. At June 30, 2018 , the unfunded commitments for the build-to-suit projects totaled approximately $20.2 million . |
Finance Receivables
Finance Receivables | 6 Months Ended |
Jun. 30, 2018 | |
Receivables [Abstract] | |
Finance Receivables | Finance Receivables Assets representing rights to receive money on demand or at fixed or determinable dates are referred to as finance receivables. Our finance receivables portfolio consists of our notes receivable (which are included in Accounts receivable and other assets, net in the condensed consolidated financial statements) and our Net investments in direct financing leases. Operating leases are not included in finance receivables as such amounts are not recognized as an asset in the condensed consolidated financial statements. Notes Receivable Our notes receivable at December 31, 2017 consisted of a $28.0 million mezzanine tranche of 10 -year commercial mortgage-backed securities on the Cipriani banquet halls in New York, New York (referred to as Cipriani) and a $38.5 million mezzanine loan collateralized by 27 retail stores in Minnesota, Wisconsin, and Iowa leased to Mills Fleet Farm Group LLC (referred to as Mills Fleet). We have and will continue to receive interest-only payments on each of these loans through maturity in July 2024 and October 2018 , respectively. During the six months ended June 30, 2018 , we received partial repayments for the Mills Fleet mezzanine loan totaling $2.5 million . As a result, the balances for the receivables at June 30, 2018 were $28.0 million and $36.0 million for Cipriani and Mills Fleet, respectively. Credit Quality of Finance Receivables We generally invest in facilities that we believe are critical to a tenant’s business and therefore have a lower risk of tenant default. At both June 30, 2018 and December 31, 2017 , we had no significant finance receivable balances that were past due and we had not established any allowances for credit losses. Additionally, there were no modifications of finance receivables during the six months ended June 30, 2018 . We evaluate the credit quality of our finance receivables utilizing an internal five-point credit rating scale, with one representing the highest credit quality and five representing the lowest. The credit quality evaluation of our finance receivables is updated quarterly. A summary of our finance receivables by internal credit quality rating is as follows (dollars in thousands): Number of Tenants/Obligors at Carrying Value at Internal Credit Quality Indicator June 30, 2018 December 31, 2017 June 30, 2018 December 31, 2017 1 — — $ — $ — 2 2 2 15,738 14,386 3 2 2 29,734 29,716 4 2 2 60,130 62,355 5 — — — — 0 $ 105,602 $ 106,457 |
Intangible Assets and Liabiliti
Intangible Assets and Liabilities | 6 Months Ended |
Jun. 30, 2018 | |
Intangible Assets And Liabilities [Abstract] | |
Intangible Assets and Liabilities | Intangible Assets and Liabilities In-place lease intangibles are included in In-place lease intangible assets in the condensed consolidated financial statements. Below-market ground lease intangibles and above-market rent intangibles are included in Other intangible assets in the condensed consolidated financial statements. Below-market rent intangibles and above-market ground lease intangibles are included in Accounts payable, accrued expenses and other liabilities in the condensed consolidated financial statements. The following table presents a reconciliation of our goodwill, which is included in our Net Lease segment and included in Accounts receivable and other assets, net in the condensed consolidated financial statements (in thousands): Six Months Ended June 30, 2018 Balance at January 1, 2018 $ 26,084 Other 1,629 Foreign currency translation (151 ) Balance at June 30, 2018 $ 27,562 Intangible assets and liabilities are summarized as follows (in thousands): June 30, 2018 December 31, 2017 Amortization Period (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Finite-Lived Intangible Assets In-place lease 4 - 23 $ 270,957 $ (123,210 ) $ 147,747 $ 274,723 $ (115,515 ) $ 159,208 Below-market ground lease 30 - 99 22,362 (1,538 ) 20,824 23,000 (1,238 ) 21,762 Above-market rent 4 - 30 12,605 (4,100 ) 8,505 12,811 (3,642 ) 9,169 305,924 (128,848 ) 177,076 310,534 (120,395 ) 190,139 Indefinite-Lived Intangible Assets Goodwill 27,562 — 27,562 26,084 — 26,084 Total intangible assets $ 333,486 $ (128,848 ) $ 204,638 $ 336,618 $ (120,395 ) $ 216,223 Finite-lived Intangible Liabilities Below-market rent 5 - 30 $ (15,423 ) $ 5,133 $ (10,290 ) $ (15,476 ) $ 4,573 $ (10,903 ) Above-market ground lease 81 (108 ) 5 (103 ) (110 ) 4 (106 ) Total intangible liabilities $ (15,531 ) $ 5,138 $ (10,393 ) $ (15,586 ) $ 4,577 $ (11,009 ) Net amortization of intangibles, including the effect of foreign currency translation, was $4.6 million and $7.5 million for the three months ended June 30, 2018 and 2017 , respectively, and $9.9 million and $15.6 million for the six months ended June 30, 2018 and 2017 , respectively. Amortization of below-market rent and above-market rent intangibles is recorded as an adjustment to Rental income, amortization of below-market and above-market ground lease intangibles is included in Property expenses, and amortization of in-place lease intangibles is included in Depreciation and amortization expense in the condensed consolidated financial statements. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The fair value of an asset is defined as the exit price, which is the amount that would either be received when an asset is sold or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The guidance establishes a three-tier fair value hierarchy based on the inputs used in measuring fair value. These tiers are: Level 1, for which quoted market prices for identical instruments are available in active markets, such as money market funds, equity securities, and U.S. Treasury securities; Level 2, for which there are inputs other than quoted prices included within Level 1 that are observable for the instrument, such as certain derivative instruments including interest rate caps, interest rate swaps, foreign currency forward contracts and foreign currency collars; and Level 3, for securities that do not fall into Level 1 or Level 2 and for which little or no market data exists, therefore requiring us to develop our own assumptions. Items Measured at Fair Value on a Recurring Basis The methods and assumptions described below were used to estimate the fair value of each class of financial instrument. For significant Level 3 items, we have also provided the unobservable inputs. Derivative Assets — Our derivative assets, which are included in Accounts receivable and other assets, net in the condensed consolidated financial statements, are comprised of foreign currency forward contracts, interest rate swaps, interest rate caps, and foreign currency collars ( Note 8 ). These derivative instruments were measured at fair value using readily observable market inputs, such as quotations on interest rates, and were classified as Level 2 as these instruments are custom, over-the-counter contracts with various bank counterparties that are not traded in an active market. Derivative Liabilities — Our derivative liabilities, which are included in Accounts payable, accrued expenses and other liabilities in the condensed consolidated financial statements, are comprised of interest rate swaps and foreign currency collars ( Note 8 ). These derivative instruments were measured at fair value using readily observable market inputs, such as quotations on interest rates, and were classified as Level 2 because they are custom, over-the-counter contracts with various bank counterparties that are not traded in an active market. Rent Guarantees — Our rent guarantees, which are included in Accounts receivable and other assets, net in the condensed consolidated financial statements, are related to two of our international investments. These rent guarantees were measured at fair value using a discounted cash flow model, and were classified as Level 3 because the model uses unobservable inputs. At both June 30, 2018 and December 31, 2017 , our rent guarantees had a fair value of $0.7 million . We determined the fair value of the rent guarantees based on an estimate of discounted cash flows using a discount rate that ranged from 7% to 9% and a growth rate that ranged from 1% to 2% , which are considered significant unobservable inputs. Significant increases or decreases to these inputs in isolation would result in a significant change in the fair value measurement. During the three and six months ended June 30, 2018 , we recognized $0.5 million and $0.6 million , respectively, of mark-to-market gains related to these rent guarantees within Other income and expenses on our condensed consolidated financial statements. During the three and six months ended June 30, 2017 , we recognized $0.4 million and $0.5 million , respectively, of mark-to-market gains related to these rent guarantees within Other income and expenses on our condensed consolidated financial statements. We did not have any transfers into or out of Level 1, Level 2, and Level 3 measurements during the three and six months ended June 30, 2018 and 2017 . Gains and losses (realized and unrealized) recognized on items measured at fair value on a recurring basis included in earnings are reported within Other gains and (losses) on our condensed consolidated financial statements. Our other financial instruments had the following carrying values and fair values as of the dates shown (dollars in thousands): June 30, 2018 December 31, 2017 Level Carrying Value Fair Value Carrying Value Fair Value Debt, net (a) (b) 3 $ 1,370,526 $ 1,387,730 $ 1,275,448 $ 1,301,844 Notes receivable (c) (d) 3 63,954 66,454 66,500 69,000 ___________ (a) Debt, net consists of Non-recourse mortgages, net and Bonds payable, net. At June 30, 2018 and December 31, 2017 , the carrying value of Non-recourse mortgages, net includes unamortized deferred financing costs of $7.5 million and $7.0 million , respectively. At both June 30, 2018 and December 31, 2017 , the carrying value of Bonds payable, net includes unamortized deferred financing costs of $0.8 million ( Note 9 ). (b) We determined the estimated fair value of our Non-recourse mortgages, net and Bonds payable, net using a discounted cash flow model that estimates the present value of the future loan payments by discounting such payments at current estimated market interest rates. The estimated market interest rates take into account interest rate risk and the value of the underlying collateral, which includes quality of the collateral, the credit quality of the tenant/obligor, and the time until maturity. (c) We determined the estimated fair value of our Notes receivable using a discounted cash flow model with rates that take into account the credit of the tenant/obligor, order of payment tranches, and interest rate risk. We also considered the value of the underlying collateral, taking into account the quality of the collateral, the credit quality of the tenant/obligor, the time until maturity, and the current market interest rate. (d) During the six months ended June 30, 2018 , we received partial repayments for the Mills Fleet mezzanine loan totaling $2.5 million . As a result, the balances for the notes receivable at June 30, 2018 were $28.0 million and $36.0 million for Cipriani and Mills Fleet, respectively ( Note 5 ). We estimated that our other financial assets and liabilities (excluding net investments in direct financing leases) had fair values that approximated their carrying values at both June 30, 2018 and December 31, 2017 . |
Risk Management and Use of Deri
Risk Management and Use of Derivative Financial Instruments | 6 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Risk Management and Use of Derivative Financial Instruments | Risk Management and Use of Derivative Financial Instruments Risk Management In the normal course of our ongoing business operations, we encounter economic risk. There are four main components of economic risk that impact us: interest rate risk, credit risk, market risk, and foreign currency risk. We are primarily subject to interest rate risk on our interest-bearing liabilities. Credit risk is the risk of default on our operations and our tenants’ inability or unwillingness to make contractually required payments. Market risk includes changes in the value of our properties and related loans, as well as changes in the value of our other investments due to changes in interest rates or other market factors. We own international investments, primarily in Europe, and are subject to risks associated with fluctuating foreign currency exchange rates. Derivative Financial Instruments When we use derivative instruments, it is generally to reduce our exposure to fluctuations in interest rates and foreign currency exchange rate movements. We have not entered into, and do not plan to enter into financial instruments for trading or speculative purposes. In addition to entering into derivative instruments on our own behalf, we may also be a party to derivative instruments that are embedded in other contracts. The primary risks related to our use of derivative instruments include: (i) a counterparty to a hedging arrangement defaulting on its obligation and (ii) a downgrade in the credit quality of a counterparty to such an extent that our ability to sell or assign our side of the hedging transaction is impaired. While we seek to mitigate these risks by entering into hedging arrangements with large financial institutions that we deem to be creditworthy, it is possible that our hedging transactions, which are intended to limit losses, could adversely affect our earnings. Furthermore, if we terminate a hedging arrangement, we may be obligated to pay certain costs, such as transaction or breakage fees. We have established policies and procedures for risk assessment, as well as the approval, reporting, and monitoring of derivative financial instrument activities. We measure derivative instruments at fair value and record them as assets or liabilities, depending on our rights or obligations under the applicable derivative contract. Derivatives that are not designated as hedges must be adjusted to fair value through earnings. For a derivative designated, and that qualified, as a cash flow hedge, the effective portion of the change in fair value of the derivative is recognized in Other comprehensive (loss) income until the hedged item is recognized in earnings. For a derivative designated, and that qualified, as a net investment hedge, the effective portion of the change in its fair value and/or the net settlement of the derivative is reported in Other comprehensive (loss) income as part of the cumulative foreign currency translation adjustment. The ineffective portion of the change in fair value of any derivative is immediately recognized in earnings. All derivative transactions with an individual counterparty are governed by a master International Swap and Derivatives Association agreement, which can be considered as a master netting arrangement; however, we report all our derivative instruments on a gross basis on our condensed consolidated financial statements. At both June 30, 2018 and December 31, 2017 , no cash collateral had been posted or received for any of our derivative positions. The following table sets forth certain information regarding our derivative instruments (in thousands): Derivatives Designated as Hedging Instruments Balance Sheet Location Asset Derivatives Fair Value at Liability Derivatives Fair Value at June 30, 2018 December 31, 2017 June 30, 2018 December 31, 2017 Foreign currency forward contracts Accounts receivable and other assets, net $ 2,217 $ 2,419 $ — $ — Interest rate swaps Accounts receivable and other assets, net 1,509 553 — — Foreign currency collars Accounts receivable and other assets, net 165 258 — — Interest rate caps Accounts receivable and other assets, net 1 1 — — Foreign currency collars Accounts payable, accrued expenses and other liabilities — — (1,988 ) (3,266 ) Interest rate swaps Accounts payable, accrued expenses and other liabilities — — (176 ) (698 ) Derivatives Not Designated as Hedging Instruments Foreign currency collars Accounts payable, accrued expenses and other liabilities — — — (366 ) Total $ 3,892 $ 3,231 $ (2,164 ) $ (4,330 ) The following tables present the impact of our derivative instruments in the condensed consolidated financial statements (in thousands): Amount of Gain (Loss) Recognized on Derivatives in Other Comprehensive (Loss) Income (Effective Portion) Three Months Ended June 30, Six Months Ended June 30, Derivatives in Cash Flow Hedging Relationships 2018 2017 2018 2017 Foreign currency collars $ 2,626 $ (2,379 ) $ 1,421 $ (2,613 ) Foreign currency forward contracts 427 (1,162 ) (202 ) (1,634 ) Interest rate swaps 363 (277 ) 1,520 (32 ) Interest rate caps 2 (6 ) 20 (2 ) Derivatives in Net Investment Hedging Relationship (a) Foreign currency collars 80 (23 ) (46 ) (33 ) Foreign currency forward contracts 23 (88 ) — (107 ) Total $ 3,521 $ (3,935 ) $ 2,713 $ (4,421 ) ___________ (a) The effective portion of the changes in fair value and the settlement of these contracts is reported in the foreign currency translation adjustment section of Other comprehensive (loss) income until the underlying investment is sold, at which time we reclassify the gain or loss to earnings. Amount of Gain (Loss) on Derivatives Reclassified from Other Comprehensive (Loss) Income into Income (Effective Portion) Derivatives in Cash Flow Hedging Relationships Location of Gain (Loss) Recognized in Income Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Foreign currency forward contracts Other gains and (losses) $ 237 $ 334 $ 459 $ 690 Interest rate swaps Interest expense (76 ) (176 ) (159 ) (387 ) Foreign currency collars Other gains and (losses) (26 ) 77 (180 ) 169 Interest rate caps Interest expense (8 ) (10 ) (39 ) (15 ) Total $ 127 $ 225 $ 81 $ 457 Amounts reported in Other comprehensive (loss) income related to our interest rate swaps will be reclassified to Interest expense as interest payments are made on our variable-rate debt. Amounts reported in Other comprehensive (loss) income related to foreign currency derivative contracts will be reclassified to Other gains and (losses) when the hedged foreign currency contracts are settled. At June 30, 2018 , we estimated that less than $0.1 million and an additional $0.6 million will be reclassified as Interest expense and Other gains and (losses), respectively, during the next 12 months. The following table presents the impact of our derivative instruments in the condensed consolidated financial statements (in thousands): Amount of Gain (Loss) on Derivatives Recognized in Income Derivatives Not in Cash Flow Hedging Relationships Location of Gain (Loss) Recognized in Income Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Foreign currency collars Other gains and (losses) $ 56 $ (25 ) $ (95 ) $ (45 ) Interest rate swaps Interest expense (41 ) 27 (47 ) (22 ) Derivatives in Cash Flow Hedging Relationships (a) Foreign currency collars Other gains and (losses) (5 ) (5 ) (15 ) (4 ) Interest rate swaps Interest expense (1 ) 7 5 10 Total $ 9 $ 4 $ (152 ) $ (61 ) __________ (a) Relates to the ineffective portion of the hedging relationship. Interest Rate Swaps and Caps We are exposed to the impact of interest rate changes primarily through our borrowing activities. To limit this exposure, we attempt to obtain mortgage financing on a long-term, fixed-rate basis. However, from time to time, we or our joint investment partners have obtained, and may in the future obtain, variable-rate non-recourse mortgage loans and, as a result, we have entered into, and may continue to enter into interest rate swap agreements or interest rate cap agreements with counterparties. Interest rate swaps, which effectively convert the variable-rate debt service obligations of a loan to a fixed rate, are agreements in which one party exchanges a stream of interest payments for a counterparty’s stream of cash flow over a specific period. The notional, or face, amount on which the swaps are based is not exchanged. Interest rate caps limit the effective borrowing rate of variable-rate debt obligations while allowing participants to share in downward shifts in interest rates. Our objective in using these derivatives is to limit our exposure to interest rate movements. The interest rate swaps and caps that our consolidated subsidiaries had outstanding at June 30, 2018 are summarized as follows (currency in thousands): Interest Rate Derivatives Number of Instruments Notional Fair Value at June 30, 2018 (a) Interest rate swaps 9 94,283 USD $ 1,374 Interest rate swap 1 10,025 EUR (41 ) Interest rate cap 2 11,300 USD 1 $ 1,334 ___________ (a) Fair value amount is based on the exchange rate of the euro at June 30, 2018 , as applicable. Foreign Currency Contracts We are exposed to foreign currency exchange rate movements, primarily in the euro and, to a lesser extent, the Norwegian krone. We manage foreign currency exchange rate movements by generally placing our debt service obligation on an investment in the same currency as the tenant’s rental obligation to us. This reduces our overall exposure to the net cash flow from that investment. However, we are subject to foreign currency exchange rate movements to the extent that there is a difference in the timing and amount of the rental obligation and the debt service. Realized and unrealized gains and losses recognized in earnings related to foreign currency transactions are included in Other gains and (losses) in the condensed consolidated financial statements. In order to hedge certain of our foreign currency cash flow exposures, we enter into foreign currency forward contracts and collars. A foreign currency forward contract is a commitment to deliver a certain amount of currency at a certain price on a specific date in the future. By entering into forward contracts and holding them to maturity, we are locked into a future currency exchange rate for the term of the contract. A foreign currency collar guarantees that the exchange rate of the currency will not fluctuate beyond the range of the options’ strike prices. Our foreign currency forward contracts and foreign currency collars have maturities of 74 months or less. The following table presents the foreign currency derivative contracts we had outstanding and their designations at June 30, 2018 (currency in thousands): Foreign Currency Derivatives Number of Instruments Notional Fair Value at Designated as Cash Flow Hedging Instruments Foreign currency collars 48 31,964 EUR $ (1,789 ) Foreign currency forward contracts 19 7,375 EUR 1,598 Foreign currency forward contracts 13 20,293 NOK 559 Foreign currency collars 24 49,470 NOK (79 ) Designated as Net Investment Hedging Instruments Foreign currency forward contracts 2 4,504 NOK 60 Foreign currency collars 3 16,750 NOK 45 $ 394 Credit Risk-Related Contingent Features We measure our credit exposure on a counterparty basis as the net positive aggregate estimated fair value of our derivatives, net of any collateral received. No collateral was received as of June 30, 2018 . At June 30, 2018 , our total credit exposure was $3.1 million and the maximum exposure to any single counterparty was $1.8 million . Some of the agreements we have with our derivative counterparties contain cross-default provisions that could trigger a declaration of default on our derivative obligations if we default, or are capable of being declared in default, on certain of our indebtedness. At June 30, 2018 , we had not been declared in default on any of our derivative obligations. The estimated fair value of our derivatives in a net liability position was $2.2 million and $4.4 million at June 30, 2018 and December 31, 2017 , respectively, which included accrued interest and any nonperformance risk adjustments. If we had breached any of these provisions at June 30, 2018 or December 31, 2017 , we could have been required to settle our obligations under these agreements at their aggregate termination value of $2.3 million and $4.5 million , respectively. |
Debt, net
Debt, net | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt, net | Debt, net Debt, net consists of Non-recourse mortgages, net and Bonds payable, net, which are collateralized by the assignment of real estate properties. At June 30, 2018 , our debt bore interest at fixed annual rates ranging from 1.6% to 5.8% and variable contractual annual rates ranging from 1.6% to 8.0% , with maturity dates ranging from 2018 to 2039 . Financing Activity During 2018 On May 9, 2018, we obtained a $34.0 million term loan encumbering seven self-storage properties located in Southern California. The properties were encumbered by a first mortgage loan in the amount of $16.4 million , which was paid in full on the same date using a portion of the proceeds from the term loan. The term loan bears an annual fixed interest rate of 4.5% , with a term to maturity of three years. We have two options to extend the maturity date, each by an additional year. The principal balance is due at maturity and interest is payable monthly. On February 13, 2018, we obtained a construction loan of $48.8 million for a student-housing development project located in Portsmouth, United Kingdom (based on the exchange rate of the British pound sterling at the date of acquisition). The loan bears a variable interest rate for outstanding drawn balances, with a term to maturity of 1.8 years and an interest rate of 6.0% as of June 30, 2018 . We had drawn $29.1 million on the construction loan (based on the exchange rate of the British pound sterling at the date of each drawdown) as of June 30, 2018 . During the six months ended June 30, 2018 , we had additional drawdowns of $14.1 million (based on the exchange rate of the British pound sterling at the date of each drawdown) on a construction loan related to a student-housing development project located in Cardiff, United Kingdom. The loan bears an annual interest rate of 7.5% plus the London Interbank Offered Rate, or LIBOR, for outstanding drawn balances, with a term to maturity of two years. Additionally, we drew down $52.4 million (based on the exchange rate of the euro at the date of drawdown) on the non-recourse mortgage loan for a completed build-to-suit hotel in Munich, Germany. The loan bears an annual interest rate of 2.8% , with a term to maturity of 5.4 years. Scheduled Debt Principal Payments Scheduled debt principal payments during the remainder of 2018, each of the next four calendar years following December 31, 2018 , and thereafter are as follows (in thousands): Years Ending December 31, Total 2018 (remainder) $ 9,084 2019 58,138 2020 124,786 2021 206,022 2022 195,229 Thereafter through 2039 785,278 Total principal payments 1,378,537 Unamortized deferred financing costs (8,250 ) Unamortized discount, net 239 Total $ 1,370,526 Certain amounts in the table above are based on the applicable foreign currency exchange rate at June 30, 2018 . The carrying value of our Non-recourse mortgages, net and Bonds payable, net decreased by $13.7 million in the aggregate from December 31, 2017 to June 30, 2018 , reflecting the impact of the strengthening of the U.S. dollar relative to certain foreign currencies (primarily the euro) during the same period. Debt Covenants As of December 31, 2017, we had repaid a total of $1.8 million (amount is based on the exchange rate of the euro as of the date of repayments) of principal on our Agrokor mortgage loan as a result of a debt service coverage ratio covenant breach. The covenant breach will be cured once the net operating income for the related property exceeds the amount set forth in the related loan agreement. As of June 30, 2018, less than $0.1 million of additional payments have been made on the loan principal. As Agrokor is currently in financial distress, there is uncertainty regarding future rent collections ( Note 12 ) and whether the default can be cured. As of December 31, 2017, we were in breach of a loan-to-value covenant on one of our bonds payable. On June 14, 2018, we entered into a pledge agreement with the bondholders to cure the covenant breach, pursuant to which we deposited $5.6 million (based on the exchange rate for the Norwegian krone on the date of deposit) in a bank account and granted a first priority interest in, and pledged the account to, the bondholders. The pledge of the account to the bondholders will stay in effect until the loan-to-value ratio is within the threshold set forth in the bond agreement or until the bonds are paid in full. There were no changes to the amounts or timing of scheduled interest and principal payments. The balance in the pledged account, based on the exchange rate as of June 30, 2018, was $5.5 million and is included as restricted cash within Accounts receivable and other assets, net on our condensed consolidated balance sheets. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies At June 30, 2018 , we were not involved in any material litigation. Various claims and lawsuits arising in the normal course of business are pending against us. The results of these proceedings are not expected to have a material adverse effect on our consolidated financial position or results of operations. See Note 4 for unfunded construction commitments. |
Net (Loss) Income Per Share and
Net (Loss) Income Per Share and Equity | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Net (Loss) Income Per Share and Equity | Net (Loss) Income Per Share and Equity Basic and Diluted (Loss) Income Per Share The following table presents net (loss) income per share (in thousands, except share and per share amounts): Three Months Ended June 30, 2018 Three Months Ended June 30, 2017 Basic and Diluted Weighted-Average Allocation of Net Loss Basic and Diluted Net (Loss) Income Basic and Diluted Weighted-Average Shares Outstanding Allocation of Net Income Basic and Diluted Net Income Class A common stock 113,010,970 $ (213 ) $ — 109,533,769 $ 4,600 $ 0.04 Class C common stock 31,593,597 (121 ) — 31,030,596 1,184 0.04 Net (loss) income attributable to CPA:18 – Global $ (334 ) $ 5,784 Six Months Ended June 30, 2018 Six Months Ended June 30, 2017 Basic and Diluted Weighted-Average Allocation of Net Income Basic and Diluted Net Income Basic and Diluted Weighted-Average Shares Outstanding Allocation of Net Income Basic and Diluted Net Income Class A common stock 112,564,943 $ 7,901 $ 0.07 108,998,427 $ 5,179 $ 0.05 Class C common stock 31,517,919 2,092 0.07 30,898,107 1,226 0.04 Net income attributable to CPA:18 – Global $ 9,993 $ 6,405 The allocation of Net (loss) income attributable to CPA:18 – Global is calculated based on the basic and diluted weighted-average shares outstanding for Class A and Class C common stock for each respective period. For both the three and six months ended June 30, 2018 , the allocation of net (loss) income for our Class A common stock excluded $0.1 million of interest expense related to the accretion of interest on our annual distribution and shareholder servicing fee liability, which is only applicable to our Class C common stock ( Note 3 ). For the three and six months ended June 30, 2017 , the allocation of net income for our Class A common stock excluded $0.1 million and $0.2 million , respectively, of interest expense related to the accretion of interest on our annual distribution and shareholder servicing fee liability ( Note 3 ). Distributions Distributions are declared at the discretion of our board of directors and are not guaranteed. For the three months ended June 30, 2018 , our board of directors declared quarterly distributions of $0.1563 per share for our Class A common stock and $0.1378 per share for our Class C common stock, which was paid on July 16, 2018 to stockholders of record on June 29, 2018 , in the amount of $22.0 million . Reclassifications Out of Accumulated Other Comprehensive Loss The following tables present a reconciliation of changes in Accumulated other comprehensive loss by component for the periods presented (in thousands): Three Months Ended June 30, 2018 Gains and (Losses) on Derivative Instruments Foreign Currency Translation Adjustments Total Beginning balance $ (1,741 ) $ (22,170 ) $ (23,911 ) Other comprehensive loss before reclassifications 3,545 (22,582 ) (19,037 ) Amounts reclassified from accumulated other comprehensive loss to: Other gains and (losses) (211 ) — (211 ) Interest expense 84 — 84 Net current-period other comprehensive loss 3,418 (22,582 ) (19,164 ) Net current-period other comprehensive loss attributable to noncontrolling interests — 2,326 2,326 Ending balance $ 1,677 $ (42,426 ) $ (40,749 ) Three Months Ended June 30, 2017 Gains and (Losses) Foreign Currency Translation Adjustments Total Beginning balance $ 5,130 $ (63,665 ) $ (58,535 ) Other comprehensive income before reclassifications (3,599 ) 19,541 15,942 Amounts reclassified from accumulated other comprehensive loss to: Other gains and (losses) (411 ) — (411 ) Interest expense 186 — 186 Net current-period other comprehensive income (3,824 ) 19,541 15,717 Net current-period other comprehensive income attributable to noncontrolling interests — (2,265 ) (2,265 ) Ending balance $ 1,306 $ (46,389 ) $ (45,083 ) Six Months Ended June 30, 2018 Gains and (Losses) on Derivative Instruments Foreign Currency Translation Adjustments Total Beginning balance $ (1,082 ) $ (32,130 ) $ (33,212 ) Other comprehensive loss before reclassifications 2,840 (11,005 ) (8,165 ) Amounts reclassified from accumulated other comprehensive loss to: Other gains and (losses) (279 ) — (279 ) Interest expense 198 — 198 Net current-period other comprehensive loss 2,759 (11,005 ) (8,246 ) Net current-period other comprehensive loss attributable to noncontrolling interests — 709 709 Ending balance $ 1,677 $ (42,426 ) $ (40,749 ) Six Months Ended June 30, 2017 Gains and (Losses) on Derivative Instruments Foreign Currency Translation Adjustments Total Beginning balance $ 5,587 $ (67,291 ) $ (61,704 ) Other comprehensive income before reclassifications (3,824 ) 23,697 19,873 Amounts reclassified from accumulated other comprehensive loss to: Other gains and (losses) (859 ) — (859 ) Interest expense 402 — 402 Net current-period other comprehensive income (4,281 ) 23,697 19,416 Net current-period other comprehensive income attributable to noncontrolling interests — (2,795 ) (2,795 ) Ending balance $ 1,306 $ (46,389 ) $ (45,083 ) See Note 8 for additional information on our derivative activity recognized within Other comprehensive (loss) income for the periods presented. |
Segment Reporting
Segment Reporting | 6 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting We operate in three reportable business segments: Net Lease, Self Storage, and Multi-Family. Our Net Lease segment includes our investments in net-leased properties, whether they are accounted for as operating leases or direct financing leases. Our Self Storage segment is comprised of our investments in self-storage properties. Our Multi-Family segment is comprised of our investments in six multi-family residential properties and eight student-housing developments. In addition, we have an All Other category that includes our notes receivable investments . The following tables present a summary of comparative results and assets for these business segments (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Net Lease Revenues (a) $ 33,299 $ 28,882 $ 66,291 $ 56,252 Operating expenses (b) (c) (19,307 ) (18,319 ) (38,426 ) (34,355 ) Interest expense (9,002 ) (6,999 ) (17,860 ) (13,994 ) Other income and (expenses), excluding interest expense 1,555 540 5,906 745 Benefit from (provision for) income taxes 88 (705 ) 233 (639 ) Net income attributable to noncontrolling interests (485 ) (198 ) (579 ) (436 ) Net income attributable to CPA:18 – Global $ 6,148 $ 3,201 $ 15,565 $ 7,573 Self Storage Revenues $ 14,398 $ 13,856 $ 28,371 $ 27,049 Operating expenses (8,762 ) (11,663 ) (18,111 ) (23,752 ) Interest expense (3,288 ) (3,039 ) (6,382 ) (6,044 ) Other income and (expenses), excluding interest expense (d) (266 ) (308 ) (745 ) (406 ) Provision for income taxes (28 ) (48 ) (55 ) (125 ) Net income (loss) attributable to CPA:18 – Global $ 2,054 $ (1,202 ) $ 3,078 $ (3,278 ) Multi-Family Revenues $ 5,911 $ 6,452 $ 11,601 $ 12,620 Operating expenses (4,194 ) (4,554 ) (8,356 ) (8,880 ) Interest expense (923 ) (1,434 ) (1,828 ) (2,586 ) Other income and (expenses), excluding interest expense 151 3 152 4 Benefit from (provision for) income taxes 47 (200 ) 60 (227 ) Net loss attributable to noncontrolling interests — 34 8 23 Net income attributable to CPA:18 – Global $ 992 $ 301 $ 1,637 $ 954 All Other Revenues $ 1,795 $ 1,783 $ 3,575 $ 3,532 Operating expenses (1 ) (2 ) (2 ) (10 ) Net income attributable to CPA:18 – Global $ 1,794 $ 1,781 $ 3,573 $ 3,522 Corporate Unallocated Corporate Overhead (e) $ (8,492 ) $ 3,889 $ (9,125 ) $ 1,495 Net income attributable to noncontrolling interests — Available Cash Distributions $ (2,830 ) $ (2,186 ) $ (4,735 ) $ (3,861 ) Total Company Revenues $ 55,403 $ 50,973 $ 109,838 $ 99,453 Operating expenses (37,119 ) (39,130 ) (74,389 ) (76,105 ) Interest expense (13,294 ) (11,791 ) (26,224 ) (23,244 ) Other income and (expenses), excluding interest expense (2,307 ) 9,205 5,361 11,768 Benefit from (provision for) income taxes 298 (1,123 ) 713 (1,193 ) Net income attributable to noncontrolling interests (3,315 ) (2,350 ) (5,306 ) (4,274 ) Net (loss) income attributable to CPA:18 – Global $ (334 ) $ 5,784 $ 9,993 $ 6,405 Total Assets June 30, 2018 December 31, 2017 Net Lease $ 1,546,102 $ 1,572,437 Self Storage 394,704 398,944 Multi-Family 349,605 256,875 Corporate 44,161 35,812 All Other 64,371 66,929 Total Company $ 2,398,943 $ 2,330,997 __________ (a) We recognized straight-line rent adjustments of $1.2 million and $1.1 million for the three months ended June 30, 2018 and 2017 , respectively, and $2.5 million and $2.1 million for the six months ended June 30, 2018 and 2017 , respectively, which increased Lease revenues within our condensed consolidated financial statements for each period. (b) In April 2017, the Croatian government passed a special law assisting the restructuring of companies considered of systemic significance in Croatia. This law directly impacts our Agrokor tenant, which is currently experiencing financial distress and received a credit downgrade from both Standard & Poor’s and Moody’s. As a result of these financial difficulties and uncertainty regarding future rent collections from the tenant, we recorded bad debt expense of $2.1 million and $1.0 million during the six months ended June 30, 2018 and 2017 , respectively. In July 2018, the creditors of Agrokor reached a settlement plan to attempt to restructure the company, but as of the date of this Report, we are unable to assess the potential impact of that plan on this investment. (c) As a result of the financial difficulties and uncertainty regarding future rent collections from a tenant in Stavanger, Norway, we recorded bad debt expense of $0.6 million and $1.1 million during the three and six months ended June 30, 2017 , respectively. (d) Includes Equity in losses of equity method investment in real estate. (e) Included in unallocated corporate overhead are asset management fees and general and administrative expenses. These expenses are calculated and reported at the portfolio level and not evaluated as part of any segment’s operating performance. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Our interim condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and, therefore, do not necessarily include all information and footnotes necessary for a fair statement of our consolidated financial position, results of operations, and cash flows in accordance with generally accepted accounting principles in the United States, or GAAP. |
Basis of Consolidation | Basis of Consolidation Our condensed consolidated financial statements reflect all of our accounts, including those of our controlled subsidiaries. The portions of equity in consolidated subsidiaries that are not attributable, directly or indirectly, to us are presented as noncontrolling interests. All significant intercompany accounts and transactions have been eliminated. |
Variable Interest Entity | When we obtain an economic interest in an entity, we evaluate the entity to determine if it should be deemed a variable interest entity, or VIE, and, if so, whether we are the primary beneficiary and are therefore required to consolidate the entity. We apply accounting guidance for consolidation of VIEs to certain entities in which the equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. Fixed price purchase and renewal options within a lease, as well as certain decision-making rights within a loan or joint-venture agreement, can cause us to consider an entity a VIE. Limited partnerships and other similar entities that operate as a partnership will be considered VIEs unless the limited partners hold substantive kick-out rights or participation rights. Significant judgment is required to determine whether a VIE should be consolidated. We review the contractual arrangements provided for in the partnership agreement or other related contracts to determine whether the entity is considered a VIE and to establish whether we have any variable interests in the VIE. We then compare our variable interests, if any, to those of the other variable interest holders to determine which party is the primary beneficiary of the VIE based on whether the entity (i) has the power to direct the activities that most significantly impact the economic performance of the VIE and (ii) has the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. The liabilities of these VIEs are non-recourse to us and can only be satisfied from each VIE’s respective assets. |
Restricted Cash | Restricted Cash — In connection with our adoption of Accounting Standards Update, or ASU, 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash , as described below, we revised our condensed consolidated statements of cash flows to include restricted cash when reconciling the beginning-of-period and end-of-period cash amounts shown on the statement of cash flows. As a result, we retrospectively revised prior periods presented to conform to the current period presentation. Restricted cash primarily consists of security deposits and amounts required to be reserved pursuant to lender agreements for debt service, capital improvements, and real estate taxes. |
Recent Accounting Pronouncements | In May 2014, the Financial Accounting Standards Board, or FASB, issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) . ASU 2014-09 is a comprehensive new revenue recognition model requiring a company to recognize revenue to depict the transfer of goods or services to a customer at an amount reflecting the consideration it expects to receive in exchange for those goods or services. ASU 2014-09 does not apply to our lease revenues, which constitute a majority of our revenues, but will primarily apply to revenues generated from our operating properties. We adopted this guidance for our interim and annual periods beginning January 1, 2018 using the modified retrospective transition method applied to any contracts not completed as of that date. There were no changes to the prior period presentations of revenue. Results of operations for reporting periods beginning January 1, 2018 are presented under Topic 606. The adoption of Topic 606 did not have a material impact on our condensed consolidated financial statements. Revenue is recognized when, or as, control of promised goods or services is transferred to customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. At contract inception, we assess the services promised in our contracts with customers and identify a performance obligation for each promise to transfer to the customer a good or service (or bundle of goods or services) that is distinct. To identify the performance obligations, we consider all of the services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices. In January 2016, the FASB issued ASU 2016-01, Financial Instruments — Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities . ASU 2016-01 requires all equity investments (other than those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value, with changes in the fair value recognized through net income. We adopted this guidance for our interim and annual periods beginning January 1, 2018. The adoption of ASU 2016-01 did not have a material impact on our condensed consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 intends to reduce diversity in practice for certain cash flow classifications, including, but not limited to (i) debt prepayment or debt extinguishment costs, (ii) contingent consideration payments made after a business combination, (iii) proceeds from the settlement of insurance claims, and (iv) distributions received from equity method investees. We retrospectively adopted this guidance for our interim and annual periods beginning January 1, 2018. The adoption of ASU 2016-15 did not have a material impact on our condensed consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash . ASU 2016-18 intends to reduce diversity in practice for the classification and presentation of changes in restricted cash on the statement of cash flows. ASU 2016-18 requires that the statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. We retrospectively adopted this guidance for our interim and annual periods beginning January 1, 2018. See Restricted Cash above for additional information. In February 2017, the FASB issued ASU 2017-05, Other Income — Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20 ): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets . ASU 2017-05 clarifies the scope and application of Accounting Standards Codification, or ASC, 610-20 on the sale or transfer of nonfinancial assets and in substance nonfinancial assets to non-customers, including partial sales. Nonfinancial assets within the scope of this Subtopic include the sale of land, buildings and intangible assets. ASU 2017-05 further clarifies that a financial asset is within the scope of Subtopic 610-20 if it meets the definition of an in substance nonfinancial asset. The amendments define the term “in substance nonfinancial asset,” in part, as a financial asset promised to a counterparty in a contract if substantially all of the fair value of the assets (recognized and unrecognized) that are promised to the counterparty in the contract is concentrated in nonfinancial assets. This amendment also clarifies that nonfinancial assets within the scope of Subtopic 610-20 may include nonfinancial assets transferred within a legal entity to a counterparty. For example, a parent company may transfer control of nonfinancial assets by transferring ownership interests in a consolidated subsidiary. We adopted this guidance for our interim and annual periods beginning January 1, 2018 and applied the modified retrospective transition method (applicable to any contracts not completed as of that date). The adoption of ASU 2017-05 did not have a material impact on our condensed consolidated financial statements. Pronouncements to be Adopted after June 30, 2018 In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . ASU 2016-02 modifies the principles for the recognition, measurement, presentation, and disclosure of leases for both parties to a contract, the lessee and the lessor. ASU 2016-02 provides new guidelines that change the accounting for leasing arrangements for lessees, whereby their rights and obligations under substantially all leases, existing and new, would be capitalized and recorded on the balance sheet. For lessors, however, the accounting remains largely equivalent to the current model, with the distinction between operating, sales-type, and direct financing leases retained, but updated to align with certain changes to the lessee model and the new revenue recognition standard. ASU 2016-02 also replaces existing sale-leaseback guidance with a new model that requires symmetrical accounting between the seller-lessee and buyer-lessor. Additionally, ASU 2016-02 requires lessors to record costs paid directly by a lessee on behalf of a lessor (e.g., real estate taxes and insurance costs) on a gross basis and will require extensive quantitative and qualitative disclosures. Early application is permitted for all entities. ASU 2016-02 provides two transition methods. The first transition method allows for application of the new model at the beginning of the earliest comparative period presented. Under the second transition method, comparative periods would not be restated, with any cumulative effect adjustments recognized in the opening balance of retained earnings in the period of adoption. In addition, a practical expedient was recently issued by the FASB, which allows lessors to combine non-lease components with related lease components if certain conditions are met. Further, in March 2018, the FASB approved, but has not yet finalized or issued, an update to allow lessors to make a policy election to record certain costs (e.g., insurance) paid directly by the lessee net, if the uncertainty regarding these variable amounts is not expected to ultimately be resolved. We will adopt this guidance for our interim and annual periods beginning January 1, 2019 and expect to use the second transition method. ASU 2016-02 is expected to impact our condensed consolidated financial statements as we have certain operating office and land lease arrangements for which we are the lessee and also certain lease arrangements that include common area maintenance services (non-lease components) where we are the lessor. We are evaluating the impact of ASU 2016-02 and have not yet determined if it will have a material impact on our business or our condensed consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses. ASU 2016-13 introduces a new model for estimating credit losses based on current expected credit losses for certain types of financial instruments, including loans receivable, held-to-maturity debt securities, and net investments in direct financing leases, amongst other financial instruments. ASU 2016-13 also modifies the impairment model for available-for-sale debt securities and expands the disclosure requirements regarding an entity’s assumptions, models, and methods for estimating the allowance for losses. ASU 2016-13 will be effective for public business entities in fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, with early application of the guidance permitted. We are in the process of evaluating the impact of adopting ASU 2016-13 on our condensed consolidated financial statements. In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities . ASU 2017-12 will make more financial and nonfinancial hedging strategies eligible for hedge accounting. It also amends the presentation and disclosure requirements and changes how companies assess hedge effectiveness. It is intended to more closely align hedge accounting with companies’ risk management strategies, simplify the application of hedge accounting, and increase transparency as to the scope and results of hedging programs. ASU 2017-12 will be effective in fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. We are in the process of evaluating the impact of adopting ASU 2017-12 on our condensed consolidated financial statements, and will adopt the standard for the fiscal year beginning January 1, 2019. Accounting Policy Update Distributions from Equity Method Investments — We classify distributions received from equity method investments using the cumulative earnings approach. Distributions received are considered returns on the investment and classified as cash inflows from operating activities. If, however, the investor’s cumulative distributions received, less distributions received in prior periods determined to be returns of investment, exceeds cumulative equity in earnings recognized, the excess is considered a return of investment and is classified as cash inflows from investing activities. Reclassifications Certain prior period amounts have been reclassified to conform to the current period presentation. In the second quarter of 2018, we reclassified notes receivable, equity investment in real estate, and goodwill to be included within Accounts receivable and other assets, net in our condensed consolidated balance sheets. Additionally, we reclassified deferred income taxes to be included within Accounts payable, accrued expenses and other liabilities in our condensed consolidated balance sheets. Prior period balances have been reclassified to conform to the current period presentation. |
Intangible Assets and Liabilities | Amortization of below-market rent and above-market rent intangibles is recorded as an adjustment to Rental income, amortization of below-market and above-market ground lease intangibles is included in Property expenses, and amortization of in-place lease intangibles is included in Depreciation and amortization expense in the condensed consolidated financial statements. |
Fair Value Measurements | The fair value of an asset is defined as the exit price, which is the amount that would either be received when an asset is sold or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The guidance establishes a three-tier fair value hierarchy based on the inputs used in measuring fair value. These tiers are: Level 1, for which quoted market prices for identical instruments are available in active markets, such as money market funds, equity securities, and U.S. Treasury securities; Level 2, for which there are inputs other than quoted prices included within Level 1 that are observable for the instrument, such as certain derivative instruments including interest rate caps, interest rate swaps, foreign currency forward contracts and foreign currency collars; and Level 3, for securities that do not fall into Level 1 or Level 2 and for which little or no market data exists, therefore requiring us to develop our own assumptions. Derivative Assets — Our derivative assets, which are included in Accounts receivable and other assets, net in the condensed consolidated financial statements, are comprised of foreign currency forward contracts, interest rate swaps, interest rate caps, and foreign currency collars ( Note 8 ). These derivative instruments were measured at fair value using readily observable market inputs, such as quotations on interest rates, and were classified as Level 2 as these instruments are custom, over-the-counter contracts with various bank counterparties that are not traded in an active market. Derivative Liabilities — Our derivative liabilities, which are included in Accounts payable, accrued expenses and other liabilities in the condensed consolidated financial statements, are comprised of interest rate swaps and foreign currency collars ( Note 8 ). These derivative instruments were measured at fair value using readily observable market inputs, such as quotations on interest rates, and were classified as Level 2 because they are custom, over-the-counter contracts with various bank counterparties that are not traded in an active market. |
Derivatives | We measure derivative instruments at fair value and record them as assets or liabilities, depending on our rights or obligations under the applicable derivative contract. Derivatives that are not designated as hedges must be adjusted to fair value through earnings. For a derivative designated, and that qualified, as a cash flow hedge, the effective portion of the change in fair value of the derivative is recognized in Other comprehensive (loss) income until the hedged item is recognized in earnings. For a derivative designated, and that qualified, as a net investment hedge, the effective portion of the change in its fair value and/or the net settlement of the derivative is reported in Other comprehensive (loss) income as part of the cumulative foreign currency translation adjustment. The ineffective portion of the change in fair value of any derivative is immediately recognized in earnings. |
Basis of Presentation Basis of
Basis of Presentation Basis of Presentation (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Variable Interest Entities | The following table presents a summary of selected financial data of the consolidated VIEs included in the condensed consolidated balance sheets (in thousands): June 30, 2018 December 31, 2017 Real estate — Land, buildings and improvements $ 370,439 $ 373,954 Real estate under construction 171,872 107,732 In-place lease intangible assets 87,185 88,617 Other intangible assets 17,536 18,040 Accumulated depreciation and amortization (61,354 ) (54,592 ) Cash and cash equivalents 10,585 5,030 Accounts receivable and other assets, net 34,167 33,219 Total assets 630,430 572,000 Non-recourse mortgages, net $ 255,406 $ 218,267 Bonds payable, net 60,945 60,577 Accounts payable, accrued expenses and other liabilities 52,637 46,858 Total liabilities 368,988 325,702 |
Schedule of Details of Accounts Receivables, Accounts Payable, and Other Assets and Liabilities | The following table presents a summary of amounts included in Accounts receivable and other assets, net in the condensed consolidated financial statements (in thousands): June 30, 2018 December 31, 2017 Accounts receivable and other assets, net Notes receivable ( Note 5 ) $ 63,954 $ 66,500 Accounts receivable, net 33,249 32,572 Goodwill ( Note 6 ) 27,562 26,084 Restricted cash 23,706 19,115 Equity investment in real estate ( Note 4 ) 19,594 20,919 Prepaid expenses 14,484 13,496 Other assets 21,693 18,792 $ 204,242 $ 197,478 The following table presents a summary of amounts included in Accounts payable, accrued expenses and other liabilities in the condensed consolidated financial statements (in thousands): June 30, 2018 December 31, 2017 Accounts payable, accrued expenses and other liabilities Deferred income taxes $ 61,619 $ 63,980 Accounts payable and accrued expenses 40,769 39,626 Deferred revenue 13,622 11,975 Intangible liabilities, net ( Note 6 ) 10,393 11,009 Other liabilities 23,405 21,441 $ 149,808 $ 148,031 |
Reconciliation of Cash and Cash Equivalents | The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the condensed consolidated balance sheets to the condensed consolidated statements of cash flows (in thousands): June 30, 2018 December 31, 2017 Cash and cash equivalents $ 90,971 $ 71,068 Restricted cash (a) 23,706 19,115 Total cash and cash equivalents and restricted cash $ 114,677 $ 90,183 __________ (a) Restricted cash is included within Accounts receivable and other assets, net on our condensed consolidated balance sheets. |
Restrictions on Cash and Cash Equivalents | The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the condensed consolidated balance sheets to the condensed consolidated statements of cash flows (in thousands): June 30, 2018 December 31, 2017 Cash and cash equivalents $ 90,971 $ 71,068 Restricted cash (a) 23,706 19,115 Total cash and cash equivalents and restricted cash $ 114,677 $ 90,183 __________ (a) Restricted cash is included within Accounts receivable and other assets, net on our condensed consolidated balance sheets. |
Agreements and Transactions w24
Agreements and Transactions with Related Parties (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | The following tables present a summary of fees we paid, expenses we reimbursed, and distributions we made to our Advisor and other affiliates (which excludes the annual distribution and shareholder servicing fee that impacts equity as further disclosed below the tables), in accordance with the terms of the relevant agreements (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Amounts Included in the Condensed Consolidated Statements of Operations Asset management fees $ 3,151 $ 2,767 $ 6,025 $ 5,476 Available Cash Distributions 2,830 2,186 4,735 3,861 Personnel and overhead reimbursements 716 787 1,433 1,569 Director compensation 40 53 80 105 Interest expense on deferred acquisition fees, affiliate loan, and accretion of interest on annual distribution and shareholder servicing fee (a) 20 319 (42 ) 620 $ 6,757 $ 6,112 $ 12,231 $ 11,631 Advisor Fees Capitalized Current acquisition fees $ 2,379 $ — $ 3,100 $ 1,393 Deferred acquisition fees 1,903 — 2,480 1,114 Capitalized personnel and overhead reimbursements 259 2 371 184 $ 4,541 $ 2 $ 5,951 $ 2,691 __________ (a) For the three and six months ended June 30, 2018 interest on the annual distribution and shareholder servicing fee is excluded as it is paid directly to selected dealers rather than through Carey Financial LLC, or Carey Financial, as discussed further below. The following table presents a summary of amounts included in Due to affiliates in the condensed consolidated financial statements (in thousands): June 30, 2018 December 31, 2017 Due to Affiliates Deferred acquisition fees, including accrued interest $ 5,786 $ 6,693 Accounts payable and other 3,316 6,102 Current acquisition fees 1,652 — Asset management fees payable 1,026 972 $ 11,780 $ 13,767 |
Real Estate, Operating Real E25
Real Estate, Operating Real Estate, Real Estate Under Construction, and Equity Investment in Real Estate (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Real Estate [Abstract] | |
Schedule of Real Estate Properties | Real estate, which consists of land and buildings leased to others, and which are subject to operating leases, is summarized as follows (in thousands): June 30, 2018 December 31, 2017 Land $ 204,198 $ 202,500 Buildings and improvements 1,070,825 1,060,672 Less: Accumulated depreciation (101,331 ) (87,886 ) $ 1,173,692 $ 1,175,286 Operating real estate, which consists of our self-storage and multi-family properties, is summarized as follows (in thousands): June 30, 2018 December 31, 2017 Land $ 98,432 $ 98,429 Buildings and improvements 470,169 468,060 Less: Accumulated depreciation (52,409 ) (43,786 ) $ 516,192 $ 522,703 |
Real Estate Under Construction | The following table provides the activity of our Real estate under construction (in thousands): Six Months Ended June 30, 2018 Beginning balance $ 134,366 Capitalized funds 87,646 Placed into service (25,900 ) Foreign currency translation adjustments (3,498 ) Capitalized interest 2,508 Ending balance $ 195,122 |
Finance Receivables (Tables)
Finance Receivables (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Receivables [Abstract] | |
Financing Receivable Credit Quality Indicators | A summary of our finance receivables by internal credit quality rating is as follows (dollars in thousands): Number of Tenants/Obligors at Carrying Value at Internal Credit Quality Indicator June 30, 2018 December 31, 2017 June 30, 2018 December 31, 2017 1 — — $ — $ — 2 2 2 15,738 14,386 3 2 2 29,734 29,716 4 2 2 60,130 62,355 5 — — — — 0 $ 105,602 $ 106,457 |
Intangible Assets and Liabili27
Intangible Assets and Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Intangible Assets And Liabilities [Abstract] | |
Goodwill Rollforward | The following table presents a reconciliation of our goodwill, which is included in our Net Lease segment and included in Accounts receivable and other assets, net in the condensed consolidated financial statements (in thousands): Six Months Ended June 30, 2018 Balance at January 1, 2018 $ 26,084 Other 1,629 Foreign currency translation (151 ) Balance at June 30, 2018 $ 27,562 |
Schedule Of Intangible Assets and Liabilities | Intangible assets and liabilities are summarized as follows (in thousands): June 30, 2018 December 31, 2017 Amortization Period (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Finite-Lived Intangible Assets In-place lease 4 - 23 $ 270,957 $ (123,210 ) $ 147,747 $ 274,723 $ (115,515 ) $ 159,208 Below-market ground lease 30 - 99 22,362 (1,538 ) 20,824 23,000 (1,238 ) 21,762 Above-market rent 4 - 30 12,605 (4,100 ) 8,505 12,811 (3,642 ) 9,169 305,924 (128,848 ) 177,076 310,534 (120,395 ) 190,139 Indefinite-Lived Intangible Assets Goodwill 27,562 — 27,562 26,084 — 26,084 Total intangible assets $ 333,486 $ (128,848 ) $ 204,638 $ 336,618 $ (120,395 ) $ 216,223 Finite-lived Intangible Liabilities Below-market rent 5 - 30 $ (15,423 ) $ 5,133 $ (10,290 ) $ (15,476 ) $ 4,573 $ (10,903 ) Above-market ground lease 81 (108 ) 5 (103 ) (110 ) 4 (106 ) Total intangible liabilities $ (15,531 ) $ 5,138 $ (10,393 ) $ (15,586 ) $ 4,577 $ (11,009 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule Of Other Financial Instruments In Carrying Values And Fair Values | Our other financial instruments had the following carrying values and fair values as of the dates shown (dollars in thousands): June 30, 2018 December 31, 2017 Level Carrying Value Fair Value Carrying Value Fair Value Debt, net (a) (b) 3 $ 1,370,526 $ 1,387,730 $ 1,275,448 $ 1,301,844 Notes receivable (c) (d) 3 63,954 66,454 66,500 69,000 ___________ (a) Debt, net consists of Non-recourse mortgages, net and Bonds payable, net. At June 30, 2018 and December 31, 2017 , the carrying value of Non-recourse mortgages, net includes unamortized deferred financing costs of $7.5 million and $7.0 million , respectively. At both June 30, 2018 and December 31, 2017 , the carrying value of Bonds payable, net includes unamortized deferred financing costs of $0.8 million ( Note 9 ). (b) We determined the estimated fair value of our Non-recourse mortgages, net and Bonds payable, net using a discounted cash flow model that estimates the present value of the future loan payments by discounting such payments at current estimated market interest rates. The estimated market interest rates take into account interest rate risk and the value of the underlying collateral, which includes quality of the collateral, the credit quality of the tenant/obligor, and the time until maturity. (c) We determined the estimated fair value of our Notes receivable using a discounted cash flow model with rates that take into account the credit of the tenant/obligor, order of payment tranches, and interest rate risk. We also considered the value of the underlying collateral, taking into account the quality of the collateral, the credit quality of the tenant/obligor, the time until maturity, and the current market interest rate. (d) During the six months ended June 30, 2018 , we received partial repayments for the Mills Fleet mezzanine loan totaling $2.5 million . As a result, the balances for the notes receivable at June 30, 2018 were $28.0 million and $36.0 million for Cipriani and Mills Fleet, respectively ( Note 5 ). |
Risk Management and Use of De29
Risk Management and Use of Derivative Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The following table sets forth certain information regarding our derivative instruments (in thousands): Derivatives Designated as Hedging Instruments Balance Sheet Location Asset Derivatives Fair Value at Liability Derivatives Fair Value at June 30, 2018 December 31, 2017 June 30, 2018 December 31, 2017 Foreign currency forward contracts Accounts receivable and other assets, net $ 2,217 $ 2,419 $ — $ — Interest rate swaps Accounts receivable and other assets, net 1,509 553 — — Foreign currency collars Accounts receivable and other assets, net 165 258 — — Interest rate caps Accounts receivable and other assets, net 1 1 — — Foreign currency collars Accounts payable, accrued expenses and other liabilities — — (1,988 ) (3,266 ) Interest rate swaps Accounts payable, accrued expenses and other liabilities — — (176 ) (698 ) Derivatives Not Designated as Hedging Instruments Foreign currency collars Accounts payable, accrued expenses and other liabilities — — — (366 ) Total $ 3,892 $ 3,231 $ (2,164 ) $ (4,330 ) |
Schedule of Derivative Instruments, Effect on Other Comprehensive Income (Loss) | The following tables present the impact of our derivative instruments in the condensed consolidated financial statements (in thousands): Amount of Gain (Loss) Recognized on Derivatives in Other Comprehensive (Loss) Income (Effective Portion) Three Months Ended June 30, Six Months Ended June 30, Derivatives in Cash Flow Hedging Relationships 2018 2017 2018 2017 Foreign currency collars $ 2,626 $ (2,379 ) $ 1,421 $ (2,613 ) Foreign currency forward contracts 427 (1,162 ) (202 ) (1,634 ) Interest rate swaps 363 (277 ) 1,520 (32 ) Interest rate caps 2 (6 ) 20 (2 ) Derivatives in Net Investment Hedging Relationship (a) Foreign currency collars 80 (23 ) (46 ) (33 ) Foreign currency forward contracts 23 (88 ) — (107 ) Total $ 3,521 $ (3,935 ) $ 2,713 $ (4,421 ) ___________ (a) The effective portion of the changes in fair value and the settlement of these contracts is reported in the foreign currency translation adjustment section of Other comprehensive (loss) income until the underlying investment is sold, at which time we reclassify the gain or loss to earnings. Amount of Gain (Loss) on Derivatives Reclassified from Other Comprehensive (Loss) Income into Income (Effective Portion) Derivatives in Cash Flow Hedging Relationships Location of Gain (Loss) Recognized in Income Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Foreign currency forward contracts Other gains and (losses) $ 237 $ 334 $ 459 $ 690 Interest rate swaps Interest expense (76 ) (176 ) (159 ) (387 ) Foreign currency collars Other gains and (losses) (26 ) 77 (180 ) 169 Interest rate caps Interest expense (8 ) (10 ) (39 ) (15 ) Total $ 127 $ 225 $ 81 $ 457 |
Derivative Instruments, Gain (Loss) | The following table presents the impact of our derivative instruments in the condensed consolidated financial statements (in thousands): Amount of Gain (Loss) on Derivatives Recognized in Income Derivatives Not in Cash Flow Hedging Relationships Location of Gain (Loss) Recognized in Income Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Foreign currency collars Other gains and (losses) $ 56 $ (25 ) $ (95 ) $ (45 ) Interest rate swaps Interest expense (41 ) 27 (47 ) (22 ) Derivatives in Cash Flow Hedging Relationships (a) Foreign currency collars Other gains and (losses) (5 ) (5 ) (15 ) (4 ) Interest rate swaps Interest expense (1 ) 7 5 10 Total $ 9 $ 4 $ (152 ) $ (61 ) __________ (a) Relates to the ineffective portion of the hedging relationship. |
Schedule of Derivative Instruments | The interest rate swaps and caps that our consolidated subsidiaries had outstanding at June 30, 2018 are summarized as follows (currency in thousands): Interest Rate Derivatives Number of Instruments Notional Fair Value at June 30, 2018 (a) Interest rate swaps 9 94,283 USD $ 1,374 Interest rate swap 1 10,025 EUR (41 ) Interest rate cap 2 11,300 USD 1 $ 1,334 ___________ (a) Fair value amount is based on the exchange rate of the euro at June 30, 2018 , as applicable. The following table presents the foreign currency derivative contracts we had outstanding and their designations at June 30, 2018 (currency in thousands): Foreign Currency Derivatives Number of Instruments Notional Fair Value at Designated as Cash Flow Hedging Instruments Foreign currency collars 48 31,964 EUR $ (1,789 ) Foreign currency forward contracts 19 7,375 EUR 1,598 Foreign currency forward contracts 13 20,293 NOK 559 Foreign currency collars 24 49,470 NOK (79 ) Designated as Net Investment Hedging Instruments Foreign currency forward contracts 2 4,504 NOK 60 Foreign currency collars 3 16,750 NOK 45 $ 394 |
Debt, net (Tables)
Debt, net (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Debt Maturities | Scheduled debt principal payments during the remainder of 2018, each of the next four calendar years following December 31, 2018 , and thereafter are as follows (in thousands): Years Ending December 31, Total 2018 (remainder) $ 9,084 2019 58,138 2020 124,786 2021 206,022 2022 195,229 Thereafter through 2039 785,278 Total principal payments 1,378,537 Unamortized deferred financing costs (8,250 ) Unamortized discount, net 239 Total $ 1,370,526 |
Net (Loss) Income Per Share a31
Net (Loss) Income Per Share and Equity (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Loss Per Share | The following table presents net (loss) income per share (in thousands, except share and per share amounts): Three Months Ended June 30, 2018 Three Months Ended June 30, 2017 Basic and Diluted Weighted-Average Allocation of Net Loss Basic and Diluted Net (Loss) Income Basic and Diluted Weighted-Average Shares Outstanding Allocation of Net Income Basic and Diluted Net Income Class A common stock 113,010,970 $ (213 ) $ — 109,533,769 $ 4,600 $ 0.04 Class C common stock 31,593,597 (121 ) — 31,030,596 1,184 0.04 Net (loss) income attributable to CPA:18 – Global $ (334 ) $ 5,784 Six Months Ended June 30, 2018 Six Months Ended June 30, 2017 Basic and Diluted Weighted-Average Allocation of Net Income Basic and Diluted Net Income Basic and Diluted Weighted-Average Shares Outstanding Allocation of Net Income Basic and Diluted Net Income Class A common stock 112,564,943 $ 7,901 $ 0.07 108,998,427 $ 5,179 $ 0.05 Class C common stock 31,517,919 2,092 0.07 30,898,107 1,226 0.04 Net income attributable to CPA:18 – Global $ 9,993 $ 6,405 |
Reclassification out of Accumulated Other Comprehensive Income | The following tables present a reconciliation of changes in Accumulated other comprehensive loss by component for the periods presented (in thousands): Three Months Ended June 30, 2018 Gains and (Losses) on Derivative Instruments Foreign Currency Translation Adjustments Total Beginning balance $ (1,741 ) $ (22,170 ) $ (23,911 ) Other comprehensive loss before reclassifications 3,545 (22,582 ) (19,037 ) Amounts reclassified from accumulated other comprehensive loss to: Other gains and (losses) (211 ) — (211 ) Interest expense 84 — 84 Net current-period other comprehensive loss 3,418 (22,582 ) (19,164 ) Net current-period other comprehensive loss attributable to noncontrolling interests — 2,326 2,326 Ending balance $ 1,677 $ (42,426 ) $ (40,749 ) Three Months Ended June 30, 2017 Gains and (Losses) Foreign Currency Translation Adjustments Total Beginning balance $ 5,130 $ (63,665 ) $ (58,535 ) Other comprehensive income before reclassifications (3,599 ) 19,541 15,942 Amounts reclassified from accumulated other comprehensive loss to: Other gains and (losses) (411 ) — (411 ) Interest expense 186 — 186 Net current-period other comprehensive income (3,824 ) 19,541 15,717 Net current-period other comprehensive income attributable to noncontrolling interests — (2,265 ) (2,265 ) Ending balance $ 1,306 $ (46,389 ) $ (45,083 ) Six Months Ended June 30, 2018 Gains and (Losses) on Derivative Instruments Foreign Currency Translation Adjustments Total Beginning balance $ (1,082 ) $ (32,130 ) $ (33,212 ) Other comprehensive loss before reclassifications 2,840 (11,005 ) (8,165 ) Amounts reclassified from accumulated other comprehensive loss to: Other gains and (losses) (279 ) — (279 ) Interest expense 198 — 198 Net current-period other comprehensive loss 2,759 (11,005 ) (8,246 ) Net current-period other comprehensive loss attributable to noncontrolling interests — 709 709 Ending balance $ 1,677 $ (42,426 ) $ (40,749 ) Six Months Ended June 30, 2017 Gains and (Losses) on Derivative Instruments Foreign Currency Translation Adjustments Total Beginning balance $ 5,587 $ (67,291 ) $ (61,704 ) Other comprehensive income before reclassifications (3,824 ) 23,697 19,873 Amounts reclassified from accumulated other comprehensive loss to: Other gains and (losses) (859 ) — (859 ) Interest expense 402 — 402 Net current-period other comprehensive income (4,281 ) 23,697 19,416 Net current-period other comprehensive income attributable to noncontrolling interests — (2,795 ) (2,795 ) Ending balance $ 1,306 $ (46,389 ) $ (45,083 ) See Note 8 for additional information on our derivative activity recognized within Other comprehensive (loss) income for the periods presented. |
Segment Reporting (Tables)
Segment Reporting (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
Reconciliation of Revenue from Segments to Consolidated | (a) We recognized straight-line rent adjustments of $1.2 million and $1.1 million for the three months ended June 30, 2018 and 2017 , respectively, and $2.5 million and $2.1 million for the six months ended June 30, 2018 and 2017 , respectively, which increased Lease revenues within our condensed consolidated financial statements for each period. (b) In April 2017, the Croatian government passed a special law assisting the restructuring of companies considered of systemic significance in Croatia. This law directly impacts our Agrokor tenant, which is currently experiencing financial distress and received a credit downgrade from both Standard & Poor’s and Moody’s. As a result of these financial difficulties and uncertainty regarding future rent collections from the tenant, we recorded bad debt expense of $2.1 million and $1.0 million during the six months ended June 30, 2018 and 2017 , respectively. In July 2018, the creditors of Agrokor reached a settlement plan to attempt to restructure the company, but as of the date of this Report, we are unable to assess the potential impact of that plan on this investment. (c) As a result of the financial difficulties and uncertainty regarding future rent collections from a tenant in Stavanger, Norway, we recorded bad debt expense of $0.6 million and $1.1 million during the three and six months ended June 30, 2017 , respectively. (d) Includes Equity in losses of equity method investment in real estate. (e) Included in unallocated corporate overhead are asset management fees and general and administrative expenses. These expenses are calculated and reported at the portfolio level and not evaluated as part of any segment’s operating performance. The following tables present a summary of comparative results and assets for these business segments (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Net Lease Revenues (a) $ 33,299 $ 28,882 $ 66,291 $ 56,252 Operating expenses (b) (c) (19,307 ) (18,319 ) (38,426 ) (34,355 ) Interest expense (9,002 ) (6,999 ) (17,860 ) (13,994 ) Other income and (expenses), excluding interest expense 1,555 540 5,906 745 Benefit from (provision for) income taxes 88 (705 ) 233 (639 ) Net income attributable to noncontrolling interests (485 ) (198 ) (579 ) (436 ) Net income attributable to CPA:18 – Global $ 6,148 $ 3,201 $ 15,565 $ 7,573 Self Storage Revenues $ 14,398 $ 13,856 $ 28,371 $ 27,049 Operating expenses (8,762 ) (11,663 ) (18,111 ) (23,752 ) Interest expense (3,288 ) (3,039 ) (6,382 ) (6,044 ) Other income and (expenses), excluding interest expense (d) (266 ) (308 ) (745 ) (406 ) Provision for income taxes (28 ) (48 ) (55 ) (125 ) Net income (loss) attributable to CPA:18 – Global $ 2,054 $ (1,202 ) $ 3,078 $ (3,278 ) Multi-Family Revenues $ 5,911 $ 6,452 $ 11,601 $ 12,620 Operating expenses (4,194 ) (4,554 ) (8,356 ) (8,880 ) Interest expense (923 ) (1,434 ) (1,828 ) (2,586 ) Other income and (expenses), excluding interest expense 151 3 152 4 Benefit from (provision for) income taxes 47 (200 ) 60 (227 ) Net loss attributable to noncontrolling interests — 34 8 23 Net income attributable to CPA:18 – Global $ 992 $ 301 $ 1,637 $ 954 All Other Revenues $ 1,795 $ 1,783 $ 3,575 $ 3,532 Operating expenses (1 ) (2 ) (2 ) (10 ) Net income attributable to CPA:18 – Global $ 1,794 $ 1,781 $ 3,573 $ 3,522 Corporate Unallocated Corporate Overhead (e) $ (8,492 ) $ 3,889 $ (9,125 ) $ 1,495 Net income attributable to noncontrolling interests — Available Cash Distributions $ (2,830 ) $ (2,186 ) $ (4,735 ) $ (3,861 ) Total Company Revenues $ 55,403 $ 50,973 $ 109,838 $ 99,453 Operating expenses (37,119 ) (39,130 ) (74,389 ) (76,105 ) Interest expense (13,294 ) (11,791 ) (26,224 ) (23,244 ) Other income and (expenses), excluding interest expense (2,307 ) 9,205 5,361 11,768 Benefit from (provision for) income taxes 298 (1,123 ) 713 (1,193 ) Net income attributable to noncontrolling interests (3,315 ) (2,350 ) (5,306 ) (4,274 ) Net (loss) income attributable to CPA:18 – Global $ (334 ) $ 5,784 $ 9,993 $ 6,405 |
Reconciliation of Assets from Segment to Consolidated | Total Assets June 30, 2018 December 31, 2017 Net Lease $ 1,546,102 $ 1,572,437 Self Storage 394,704 398,944 Multi-Family 349,605 256,875 Corporate 44,161 35,812 All Other 64,371 66,929 Total Company $ 2,398,943 $ 2,330,997 |
Organization - Narratives (Deta
Organization - Narratives (Details) $ in Thousands, ft² in Millions | 6 Months Ended | 39 Months Ended | 78 Months Ended | |
Jun. 30, 2018USD ($)ft²segmentpropertytenant | Jun. 30, 2017USD ($) | Apr. 02, 2015USD ($) | Jun. 30, 2018USD ($)ft²propertytenant | |
Public Offering | ||||
Capital interest ownership in operating partnership | 99.97% | 99.97% | ||
Additional Disclosures | ||||
Number of properties | 59 | 59 | ||
Number of tenants | tenant | 100 | 100 | ||
Area of real estate property (sqft) | ft² | 10.2 | 10.2 | ||
Number of reportable segments | segment | 3 | |||
Proceeds from issuance of shares | $ | $ 20,970 | $ 21,175 | $ 1,200,000 | |
Class A common stock | ||||
Additional Disclosures | ||||
Proceeds from dividend reinvestment plan | $ | $ 133,600 | |||
Class C common stock | ||||
Additional Disclosures | ||||
Proceeds from dividend reinvestment plan | $ | $ 37,000 | |||
Multi-family | Multi-family | ||||
Additional Disclosures | ||||
Number of properties | 6 | 6 | ||
Student housing developments | Multi-family | ||||
Additional Disclosures | ||||
Number of properties | 8 | 8 | ||
Operating Real Estate | ||||
Additional Disclosures | ||||
Area of real estate property (sqft) | ft² | 6.7 | 6.7 | ||
Operating Real Estate | Self Storage | ||||
Additional Disclosures | ||||
Number of properties | 69 | 69 | ||
Operating Real Estate | Multi-family | ||||
Additional Disclosures | ||||
Number of properties | 14 | 14 |
Basis of Presentation Basis o34
Basis of Presentation Basis of Presentation - Narratives (Details) $ in Thousands | Jun. 30, 2018USD ($)vie | Dec. 31, 2017USD ($)vie |
Variable Interest Entity | ||
Variable interest entities consolidated, count | 15 | 11 |
Variable interest entities, count | 16 | 12 |
Variable interest entities unconsolidated, count | 1 | 1 |
Equity investment in real estate | $ | $ 19,594 | $ 20,919 |
Equity method investments | ||
Variable Interest Entity | ||
Equity investment in real estate | $ | $ 19,600 | $ 20,900 |
Basis of Presentation - Variabl
Basis of Presentation - Variable Interest Entity Disclosure (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Assets | ||
Real estate — Land, buildings and improvements | $ 1,275,023 | $ 1,263,172 |
Real estate under construction | 195,122 | 134,366 |
In-place lease intangible assets | 270,957 | 274,723 |
Other intangible assets | 34,967 | 35,811 |
Accumulated depreciation and amortization | (282,588) | (252,067) |
Cash and cash equivalents | 90,971 | 71,068 |
Accounts receivable and other assets, net | 204,242 | 197,478 |
Total assets | 2,398,943 | 2,330,997 |
Liabilities | ||
Non-recourse mortgages, net | 1,223,215 | 1,129,432 |
Bonds payable, net | 147,311 | 146,016 |
Accounts payable, accrued expenses and other liabilities | 149,808 | 148,031 |
Total liabilities | 1,554,081 | 1,458,932 |
VIE | ||
Assets | ||
Real estate — Land, buildings and improvements | 370,439 | 373,954 |
Real estate under construction | 171,872 | 107,732 |
In-place lease intangible assets | 87,185 | 88,617 |
Other intangible assets | 17,536 | 18,040 |
Accumulated depreciation and amortization | (61,354) | (54,592) |
Cash and cash equivalents | 10,585 | 5,030 |
Accounts receivable and other assets, net | 34,167 | 33,219 |
Total assets | 630,430 | 572,000 |
Liabilities | ||
Non-recourse mortgages, net | 255,406 | 218,267 |
Bonds payable, net | 60,945 | 60,577 |
Accounts payable, accrued expenses and other liabilities | 52,637 | 46,858 |
Total liabilities | $ 368,988 | $ 325,702 |
Basis of Presentation - Account
Basis of Presentation - Accounts Receivable and Other Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Notes receivable (Note 5) | $ 63,954 | $ 66,500 |
Accounts receivable, net | 33,249 | 32,572 |
Goodwill (Note 6) | 27,562 | 26,084 |
Restricted cash | 23,706 | 19,115 |
Equity investment in real estate (Note 4) | 19,594 | 20,919 |
Prepaid expenses | 14,484 | 13,496 |
Other assets | 21,693 | 18,792 |
Accounts receivable and other assets, net | $ 204,242 | $ 197,478 |
Basis of Presentation - Accou37
Basis of Presentation - Accounts Payable, Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Deferred income taxes | $ 61,619 | $ 63,980 |
Accounts payable and accrued expenses | 40,769 | 39,626 |
Deferred revenue | 13,622 | 11,975 |
Intangible liabilities, net (Note 6) | 10,393 | 11,009 |
Other liabilities | 23,405 | 21,441 |
Accounts payable, accrued expenses and other liabilities | $ 149,808 | $ 148,031 |
Basis of Presentation - Cash, C
Basis of Presentation - Cash, Cash Equivalents, and Restricted Cash Equivalents Reconciliation (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Cash and cash equivalents | $ 90,971 | $ 71,068 | ||
Restricted cash | 23,706 | 19,115 | ||
Total cash and cash equivalents and restricted cash | $ 114,677 | $ 90,183 | $ 79,619 | $ 93,741 |
Agreements and Transactions w39
Agreements and Transactions with Related Parties - Narratives (Details) - USD ($) | 6 Months Ended | |||
Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Jul. 31, 2016 | |
Related Party Transaction | ||||
Maximum line of credit approved by directors | $ 50,000,000 | |||
Due to Related Party | ||||
Underwriting compensation limit (as a percentage) | 10.00% | |||
Preferred return (as a percentage) | 5.00% | |||
Due from advisor | $ 700,000 | |||
Personnel and overhead reimbursement (as a percentage) | 1.00% | 2.00% | ||
Legal fee reimbursement rate | 0.25% | |||
Distributions of available cash (as a percentage) | 10.00% | |||
Current | ||||
Due to Related Party | ||||
Acquisition fees (as a percentage) | 2.50% | |||
Deferred | ||||
Due to Related Party | ||||
Acquisition fees (as a percentage) | 2.00% | |||
Interest rate on deferred acquisition fee | 2.00% | |||
Accounts payable, accrued expenses and other liabilities | ||||
Due to Related Party | ||||
Estimated future payments | $ 4,800,000 | $ 5,700,000 | ||
Class A common stock | ||||
Related Party Transaction | ||||
Net asset value (usd per share) | $ 8.57 | |||
Number of shares held by advisor (shares) | 112,849,543 | 111,193,651 | ||
Class C | ||||
Related Party Transaction | ||||
Number of shares held by advisor (shares) | 31,410,984 | 31,189,137 | ||
Due to Related Party | ||||
Shareholder servicing fee (as a percentage) | 1.00% | |||
Real estate commission | ||||
Due to Related Party | ||||
Subordinated disposition fees (as a percentage) | 50.00% | |||
Contract sales price of investment | ||||
Due to Related Party | ||||
Subordinated disposition fees (as a percentage) | 3.00% | |||
Average invested asset | ||||
Due to Related Party | ||||
Percentage of operating expense reimbursement | 2.00% | |||
Adjusted net income | ||||
Due to Related Party | ||||
Percentage of operating expense reimbursement | 25.00% | |||
Minimum | ||||
Due to Related Party | ||||
Equity method investments ownership percentage | 50.00% | |||
Minimum | Average market value of investment | ||||
Related Party Transaction | ||||
Asset management fees (as a percentage) | 0.50% | |||
Maximum | ||||
Due to Related Party | ||||
Acquisition fees (as a percentage) | 6.00% | |||
Equity method investments ownership percentage | 99.00% | |||
Maximum | Average equity value of investment | ||||
Related Party Transaction | ||||
Asset management fees (as a percentage) | 1.50% | |||
W.P. Carey | ||||
Related Party Transaction | ||||
Loan from related party | $ 0 | $ 0 | ||
Advisor | Class A common stock | ||||
Related Party Transaction | ||||
Number of shares held by advisor (shares) | 4,327,814 | |||
Advisor owned percentage of common stock | 3.00% |
Agreements and Transactions w40
Agreements and Transactions with Related Parties - Related Party Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Amounts Included in the Condensed Consolidated Statements of Operations | ||||
Operating expenses | $ 37,119 | $ 39,130 | $ 74,389 | $ 76,105 |
Available Cash Distributions | 2,830 | 2,186 | 4,735 | 3,861 |
Personnel and overhead reimbursements | 716 | 787 | 1,433 | 1,569 |
Director compensation | 40 | 53 | 80 | 105 |
Interest expense on deferred acquisition fees, affiliate loan, and accretion of interest on annual distribution and shareholder servicing fee (a) | 20 | 319 | (42) | 620 |
Operating expenses | 6,757 | 6,112 | 12,231 | 11,631 |
Advisor Fees Capitalized | ||||
Current acquisition fees | 2,379 | 0 | 3,100 | 1,393 |
Deferred acquisition fees | 1,903 | 0 | 2,480 | 1,114 |
Capitalized personnel and overhead reimbursements | 259 | 2 | 371 | 184 |
Transaction fees incurred | 4,541 | 2 | 5,951 | 2,691 |
Asset management fees | ||||
Amounts Included in the Condensed Consolidated Statements of Operations | ||||
Operating expenses | $ 3,151 | $ 2,767 | $ 6,025 | $ 5,476 |
Agreements and Transactions w41
Agreements and Transactions with Related Parties - Due to Affiliates (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Due to Affiliates | ||
Deferred acquisition fees, including accrued interest | $ 5,786 | $ 6,693 |
Accounts payable and other | 3,316 | 6,102 |
Current acquisition fees | 1,652 | 0 |
Asset management fees payable | 1,026 | 972 |
Due to affiliate | $ 11,780 | $ 13,767 |
Real Estate, Operating Real E42
Real Estate, Operating Real Estate, Real Estate Under Construction, and Equity Investment in Real Estate - Narratives (Details) $ in Thousands | Jun. 25, 2018USD ($) | Jun. 14, 2018USD ($) | Jun. 11, 2018USD ($) | Mar. 08, 2018USD ($) | Feb. 19, 2016USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2018USD ($)property$ / € | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($)property$ / € | Jun. 30, 2017USD ($) | Dec. 31, 2017USD ($)$ / € |
Real Estate Properties | ||||||||||||
Effect of exchange rate fluctuation | $ (22,582) | $ 19,541 | $ (11,005) | $ 23,697 | ||||||||
Acquisition | ||||||||||||
Capitalized funds | 87,646 | |||||||||||
Non-recourse mortgages, net | 1,223,215 | 1,223,215 | $ 1,129,432 | |||||||||
Construction loan | $ 39,700 | 39,700 | ||||||||||
Capitalized interest | 2,508 | |||||||||||
Placed into service | $ 25,900 | |||||||||||
Number of properties | property | 59 | 59 | ||||||||||
Equity investment in real estate | $ 19,594 | $ 19,594 | 20,919 | |||||||||
Noncash investing | ||||||||||||
Acquisition | ||||||||||||
Accrued liabilities | 2,500 | 2,500 | ||||||||||
Initial Funding | ||||||||||||
Acquisition | ||||||||||||
Capitalized funds | 47,900 | |||||||||||
Real Estate | ||||||||||||
Real Estate Properties | ||||||||||||
Effect of exchange rate fluctuation | (17,500) | |||||||||||
Acquisition | ||||||||||||
Depreciation expense | 7,900 | 6,700 | 15,800 | 13,000 | ||||||||
Real Estate | Student Housing in Barcelona, Spain | ||||||||||||
Acquisition | ||||||||||||
Investment purchase price | $ 10,500 | |||||||||||
Ownership Interest In joint venture (percentage) | 99.00% | |||||||||||
Real Estate | Student Housing in Barcelona, Spain | Forecasted | ||||||||||||
Acquisition | ||||||||||||
Investment purchase price | $ 28,500 | |||||||||||
Real Estate | Student Housing in Coimbra, Portugal | ||||||||||||
Acquisition | ||||||||||||
Investment purchase price | $ 9,300 | |||||||||||
Ownership Interest In joint venture (percentage) | 99.00% | |||||||||||
Real Estate | Student Housing in Coimbra, Portugal | Forecasted | ||||||||||||
Acquisition | ||||||||||||
Investment purchase price | $ 26,300 | |||||||||||
Real Estate | Student Housing in San Sebastian, Spain | ||||||||||||
Acquisition | ||||||||||||
Investment purchase price | $ 13,100 | |||||||||||
Real Estate | Student Housing in San Sebastian, Spain | Forecasted | ||||||||||||
Acquisition | ||||||||||||
Investment purchase price | $ 36,700 | |||||||||||
Real Estate | Student Housing in Barcelona Spain | ||||||||||||
Acquisition | ||||||||||||
Investment purchase price | $ 13,100 | |||||||||||
Real Estate | Student Housing in Barcelona Spain | Forecasted | ||||||||||||
Acquisition | ||||||||||||
Investment purchase price | $ 31,700 | |||||||||||
Operating Real Estate | ||||||||||||
Acquisition | ||||||||||||
Depreciation expense | 4,300 | $ 4,500 | $ 8,700 | $ 8,900 | ||||||||
Build To Suit Projects | ||||||||||||
Acquisition | ||||||||||||
Number of BTS projects | property | 8 | |||||||||||
Unfunded commitment | 181,700 | $ 181,700 | ||||||||||
Build To Suit Projects | Equity method investments | ||||||||||||
Acquisition | ||||||||||||
Unfunded commitment | 20,200 | 20,200 | ||||||||||
Build To Suit Projects | University in Accra, Ghana | ||||||||||||
Acquisition | ||||||||||||
Capitalized funds | 32,500 | |||||||||||
Accrued liabilities | 900 | 900 | ||||||||||
Deferred tax liability | 3,700 | 3,700 | ||||||||||
Non-recourse mortgages, net | $ 41,000 | |||||||||||
Build To Suit Projects | University in Accra, Ghana | US Treasury | ||||||||||||
Acquisition | ||||||||||||
Variable interest rate on debt | 3.00% | |||||||||||
Equity method investments | ||||||||||||
Acquisition | ||||||||||||
Equity investment in real estate | 19,600 | 19,600 | 20,900 | |||||||||
Equity method investment, liabilities | $ 23,300 | $ 23,300 | $ 21,500 | |||||||||
Equity method investments | Self Storage | ||||||||||||
Acquisition | ||||||||||||
Number of properties | property | 4 | 4 | ||||||||||
Equity method investments ownership percentage | 90.00% | 90.00% | ||||||||||
Equity method investment counterparty ownership percentage | 10.00% | 10.00% | ||||||||||
Euro | ||||||||||||
Real Estate Properties | ||||||||||||
Decrease in foreign currency exchange rate | 2.80% | 2.80% | ||||||||||
Foreign currency exchange rate | $ / € | 1.1658 | 1.1658 | 1.1993 |
Real Estate, Operating Real E43
Real Estate, Operating Real Estate, Real Estate Under Construction, and Equity Investment in Real Estate - Property Plant and Equipment (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Investments in real estate: | ||
Net investments in real estate | $ 2,103,730 | $ 2,062,451 |
Real Estate | ||
Investments in real estate: | ||
Land | 204,198 | 202,500 |
Buildings and improvements | 1,070,825 | 1,060,672 |
Less: Accumulated depreciation | (101,331) | (87,886) |
Net investments in real estate | 1,173,692 | 1,175,286 |
Operating Real Estate | ||
Investments in real estate: | ||
Land | 98,432 | 98,429 |
Buildings and improvements | 470,169 | 468,060 |
Less: Accumulated depreciation | (52,409) | (43,786) |
Net investments in real estate | $ 516,192 | $ 522,703 |
Real Estate, Operating Real E44
Real Estate, Operating Real Estate, Real Estate Under Construction, and Equity Investment in Real Estate - Rollforward of Real Estate Under Construction (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Real Estate Under Construction | |
Beginning balance | $ 134,366 |
Capitalized funds | 87,646 |
Placed into service | (25,900) |
Foreign currency translation adjustments | (3,498) |
Capitalized interest | 2,508 |
Ending balance | $ 195,122 |
Finance Receivables - Narrative
Finance Receivables - Narratives (Details) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2018USD ($)property | Jun. 30, 2017USD ($) | Dec. 31, 2017USD ($)property | |
Accounts, Notes, Loans and Financing Receivable | |||
Notes receivable | $ 63,954 | $ 66,500 | |
Number of properties | property | 59 | ||
Proceeds from repayment of notes receivable | $ 2,546 | $ 0 | |
Property Leased to Mills Fleet Farm Group LLC | |||
Accounts, Notes, Loans and Financing Receivable | |||
Notes receivable | 36,000 | $ 38,500 | |
Number of properties | property | 27 | ||
Proceeds from repayment of notes receivable | $ 2,500 | ||
Cipriani | |||
Accounts, Notes, Loans and Financing Receivable | |||
Notes receivable | $ 28,000 | ||
Accounts receivable, term | 10 years |
Finance Receivables - Internal
Finance Receivables - Internal Credit Quality Rating (Details) $ in Thousands | Jun. 30, 2018USD ($)tenant | Dec. 31, 2017USD ($)tenant |
Credit Quality Of Finance Receivables | ||
Carrying Value | $ 105,602 | $ 106,457 |
Internally Assigned Grade 1 | ||
Credit Quality Of Finance Receivables | ||
Number of tenants and obligors | tenant | 0 | 0 |
Carrying Value | $ 0 | $ 0 |
Internally Assigned Grade 2 | ||
Credit Quality Of Finance Receivables | ||
Number of tenants and obligors | tenant | 2 | 2 |
Carrying Value | $ 15,738 | $ 14,386 |
Internally Assigned Grade 3 | ||
Credit Quality Of Finance Receivables | ||
Number of tenants and obligors | tenant | 2 | 2 |
Carrying Value | $ 29,734 | $ 29,716 |
Internally Assigned Grade 4 | ||
Credit Quality Of Finance Receivables | ||
Number of tenants and obligors | tenant | 2 | 2 |
Carrying Value | $ 60,130 | $ 62,355 |
Internally Assigned Grade 5 | ||
Credit Quality Of Finance Receivables | ||
Number of tenants and obligors | tenant | 0 | 0 |
Carrying Value | $ 0 | $ 0 |
Intangible Assets and Liabili47
Intangible Assets and Liabilities - Narratives (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Intangible Assets And Liabilities [Abstract] | ||||
Net amortization of intangibles | $ 4.6 | $ 7.5 | $ 9.9 | $ 15.6 |
Intangible Assets and Liabili48
Intangible Assets and Liabilities - Goodwill Rollforward (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Goodwill | |
Goodwill - beginning balance | $ 26,084 |
Other | 1,629 |
Foreign currency translation | (151) |
Goodwill - ending balance | $ 27,562 |
Intangible Assets and Liabili49
Intangible Assets and Liabilities - Intangible Assets and Liabilities Summary (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Dec. 31, 2017 | |
Amortizable Intangible Assets | ||
Finite-lived intangible assets, gross | $ 305,924 | $ 310,534 |
Less: accumulated amortization | (128,848) | (120,395) |
Finite-lived intangible assets, net | 177,076 | 190,139 |
Goodwill | 27,562 | 26,084 |
Total intangible assets, gross | 333,486 | 336,618 |
Total intangible assets, net | 204,638 | 216,223 |
Amortizable Intangible Liability | ||
Finite-Lived Intangible Liabilities, Gross | (15,531) | (15,586) |
Finite Lived Intangible Liabilities Accumulated Amortization | 5,138 | 4,577 |
Finite Lived Intangible Liabilities Net | (10,393) | (11,009) |
Below-market rent | ||
Amortizable Intangible Liability | ||
Finite-Lived Intangible Liabilities, Gross | (15,423) | (15,476) |
Finite Lived Intangible Liabilities Accumulated Amortization | 5,133 | 4,573 |
Finite Lived Intangible Liabilities Net | $ (10,290) | (10,903) |
Below-market rent | Minimum | ||
Finite Lived Intangible Assets Liabilities [Line Items] | ||
Finite-lived intangible asset, useful life | 5 years | |
Below-market rent | Maximum | ||
Finite Lived Intangible Assets Liabilities [Line Items] | ||
Finite-lived intangible asset, useful life | 30 years | |
Above-market ground lease | ||
Finite Lived Intangible Assets Liabilities [Line Items] | ||
Finite-lived intangible asset, useful life | 81 years | |
Amortizable Intangible Liability | ||
Finite-Lived Intangible Liabilities, Gross | $ (108) | (110) |
Finite Lived Intangible Liabilities Accumulated Amortization | 5 | 4 |
Finite Lived Intangible Liabilities Net | (103) | (106) |
In-place lease | ||
Amortizable Intangible Assets | ||
Finite-lived intangible assets, gross | 270,957 | 274,723 |
Less: accumulated amortization | (123,210) | (115,515) |
Finite-lived intangible assets, net | $ 147,747 | 159,208 |
In-place lease | Minimum | ||
Finite Lived Intangible Assets Liabilities [Line Items] | ||
Finite-lived intangible asset, useful life | 4 years | |
In-place lease | Maximum | ||
Finite Lived Intangible Assets Liabilities [Line Items] | ||
Finite-lived intangible asset, useful life | 23 years | |
Below-market ground lease | ||
Amortizable Intangible Assets | ||
Finite-lived intangible assets, gross | $ 22,362 | 23,000 |
Less: accumulated amortization | (1,538) | (1,238) |
Finite-lived intangible assets, net | $ 20,824 | 21,762 |
Below-market ground lease | Minimum | ||
Finite Lived Intangible Assets Liabilities [Line Items] | ||
Finite-lived intangible asset, useful life | 30 years | |
Below-market ground lease | Maximum | ||
Finite Lived Intangible Assets Liabilities [Line Items] | ||
Finite-lived intangible asset, useful life | 99 years | |
Above-market rent | ||
Amortizable Intangible Assets | ||
Finite-lived intangible assets, gross | $ 12,605 | 12,811 |
Less: accumulated amortization | (4,100) | (3,642) |
Finite-lived intangible assets, net | $ 8,505 | $ 9,169 |
Above-market rent | Minimum | ||
Finite Lived Intangible Assets Liabilities [Line Items] | ||
Finite-lived intangible asset, useful life | 4 years | |
Above-market rent | Maximum | ||
Finite Lived Intangible Assets Liabilities [Line Items] | ||
Finite-lived intangible asset, useful life | 30 years |
Fair Value Measurements - Narra
Fair Value Measurements - Narratives (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Dec. 31, 2017USD ($) | |
Fair Value | |||||
Rent guarantees, fair value | $ 700 | $ 700 | $ 700 | ||
Asset fair value adjustment | 500 | $ 400 | 600 | $ 500 | |
Deferred financing costs | 8,250 | 8,250 | |||
Proceeds from repayment of notes receivable | 2,546 | $ 0 | |||
Notes receivable | 63,954 | 63,954 | 66,500 | ||
Cipriani | |||||
Fair Value | |||||
Notes receivable | 28,000 | ||||
Property Leased to Mills Fleet Farm Group LLC | |||||
Fair Value | |||||
Proceeds from repayment of notes receivable | 2,500 | ||||
Notes receivable | 36,000 | 36,000 | 38,500 | ||
Non recourse debt | |||||
Fair Value | |||||
Deferred financing costs | 7,500 | 7,500 | 7,000 | ||
Bonds payable | |||||
Fair Value | |||||
Deferred financing costs | $ 800 | $ 800 | $ 800 | ||
Discount rate | Minimum | |||||
Fair Value | |||||
Discount rate on rent guarantee | 0.07 | 0.07 | |||
Discount rate | Maximum | |||||
Fair Value | |||||
Discount rate on rent guarantee | 0.09 | 0.09 | |||
Growth rate | Minimum | |||||
Fair Value | |||||
Discount rate on rent guarantee | 0.01 | 0.01 | |||
Growth rate | Maximum | |||||
Fair Value | |||||
Discount rate on rent guarantee | 0.02 | 0.02 |
Fair Value Measurements - Carry
Fair Value Measurements - Carrying Value and Fair Value Measurements (Details) - Level 3 - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Carrying Value | ||
Liabilities | ||
Debt, net | $ 1,370,526 | $ 1,275,448 |
Notes receivable | 63,954 | 66,500 |
Fair Value | ||
Liabilities | ||
Debt, net | 1,387,730 | 1,301,844 |
Notes receivable | $ 66,454 | $ 69,000 |
Risk Management and Use of De52
Risk Management and Use of Derivative Financial Instruments - Narratives (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2018 | Dec. 31, 2017 | |
Derivative | ||
Cash collateral posted | $ 0 | $ 0 |
Derivative instrument remaining maturity period | 74 months | |
Collateral received | $ 0 | |
Total credit exposure | 3,100,000 | |
Derivative in net liability position | 2,200,000 | 4,400,000 |
Termination value of assets | 2,300,000 | $ 4,500,000 |
Individual Counterparty | ||
Derivative | ||
Total credit exposure | 1,800,000 | |
Interest expense | ||
Derivative | ||
Estimated amount of derivative income loss to be reclassified to interest expense in the next 12 months | 100,000 | |
Other income | ||
Derivative | ||
Estimated amount of derivative income loss to be reclassified to interest expense in the next 12 months | $ 600,000 |
Risk Management and Use of De53
Risk Management and Use of Derivative Financial Instruments - Information Regarding Derivative Instruments (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Derivatives, Fair Value | ||
Derivative asset fair value | $ 3,892 | $ 3,231 |
Derivative liability, fair value | (2,164) | (4,330) |
Designated as Hedging Instrument | Accounts receivable and other assets, net | Foreign currency forward contracts | ||
Derivatives, Fair Value | ||
Derivative asset fair value | 2,217 | 2,419 |
Designated as Hedging Instrument | Accounts receivable and other assets, net | Interest rate swaps | ||
Derivatives, Fair Value | ||
Derivative asset fair value | 1,509 | 553 |
Designated as Hedging Instrument | Accounts receivable and other assets, net | Foreign currency collars | ||
Derivatives, Fair Value | ||
Derivative asset fair value | 165 | 258 |
Designated as Hedging Instrument | Accounts receivable and other assets, net | Interest rate caps | ||
Derivatives, Fair Value | ||
Derivative asset fair value | 1 | 1 |
Designated as Hedging Instrument | Accounts payable, accrued expenses and other liabilities | Interest rate swaps | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | (176) | (698) |
Designated as Hedging Instrument | Accounts payable, accrued expenses and other liabilities | Foreign currency collars | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | (1,988) | (3,266) |
Derivatives Not Designated as Hedging Instruments | Accounts payable, accrued expenses and other liabilities | Foreign currency forward contracts | ||
Derivatives, Fair Value | ||
Derivative liability, fair value | $ 0 | $ (366) |
Risk Management and Use of De54
Risk Management and Use of Derivative Financial Instruments - Derivative Gain Loss Recognized in OCI (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain (Loss) Recognized on Derivatives in Other Comprehensive (Loss) Income (Effective Portion) | $ 3,521 | $ (3,935) | $ 2,713 | $ (4,421) |
Derivatives in Cash Flow Hedging Relationships | Foreign currency collars | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain (Loss) Recognized on Derivatives in Other Comprehensive (Loss) Income (Effective Portion) | 2,626 | (2,379) | 1,421 | (2,613) |
Derivatives in Cash Flow Hedging Relationships | Foreign currency forward contracts | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain (Loss) Recognized on Derivatives in Other Comprehensive (Loss) Income (Effective Portion) | 427 | (1,162) | (202) | (1,634) |
Derivatives in Cash Flow Hedging Relationships | Interest rate swaps | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain (Loss) Recognized on Derivatives in Other Comprehensive (Loss) Income (Effective Portion) | 363 | (277) | 1,520 | (32) |
Derivatives in Cash Flow Hedging Relationships | Interest rate caps | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain (Loss) Recognized on Derivatives in Other Comprehensive (Loss) Income (Effective Portion) | 2 | (6) | 20 | (2) |
Net Investment Hedging | Foreign currency collars | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain (Loss) Recognized on Derivatives in Other Comprehensive (Loss) Income (Effective Portion) | 80 | (23) | (46) | (33) |
Net Investment Hedging | Foreign currency forward contracts | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain (Loss) Recognized on Derivatives in Other Comprehensive (Loss) Income (Effective Portion) | $ 23 | $ (88) | $ 0 | $ (107) |
Risk Management and Use of De55
Risk Management and Use of Derivative Financial Instruments - Derivative Gain (Loss) Reclassified From OCI (Details) - Derivatives in Cash Flow Hedging Relationships - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Amount of Gain (Loss) on Derivatives Reclassified from Other Comprehensive (Loss) Income into Income (Effective Portion) | ||||
Amount of Gain (Loss) on Derivatives Reclassified from Other Comprehensive (Loss) Income into Income (Effective Portion) | $ 127 | $ 225 | $ 81 | $ 457 |
Foreign currency forward contracts | Other gains and (losses) | ||||
Amount of Gain (Loss) on Derivatives Reclassified from Other Comprehensive (Loss) Income into Income (Effective Portion) | ||||
Amount of Gain (Loss) on Derivatives Reclassified from Other Comprehensive (Loss) Income into Income (Effective Portion) | 237 | 334 | 459 | 690 |
Foreign currency collars | Other gains and (losses) | ||||
Amount of Gain (Loss) on Derivatives Reclassified from Other Comprehensive (Loss) Income into Income (Effective Portion) | ||||
Amount of Gain (Loss) on Derivatives Reclassified from Other Comprehensive (Loss) Income into Income (Effective Portion) | (26) | 77 | (180) | 169 |
Interest rate swaps | Interest expense | ||||
Amount of Gain (Loss) on Derivatives Reclassified from Other Comprehensive (Loss) Income into Income (Effective Portion) | ||||
Amount of Gain (Loss) on Derivatives Reclassified from Other Comprehensive (Loss) Income into Income (Effective Portion) | (76) | (176) | (159) | (387) |
Interest rate caps | Interest expense | ||||
Amount of Gain (Loss) on Derivatives Reclassified from Other Comprehensive (Loss) Income into Income (Effective Portion) | ||||
Amount of Gain (Loss) on Derivatives Reclassified from Other Comprehensive (Loss) Income into Income (Effective Portion) | $ (8) | $ (10) | $ (39) | $ (15) |
Risk Management and Use of De56
Risk Management and Use of Derivative Financial Instruments - Derivative Gain (Loss) Recognized in Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Amount of Gain (Loss) on Derivatives Recognized in Income | ||||
Amount of Gain (Loss) on Derivatives Recognized in Income | $ 9 | $ 4 | $ (152) | $ (61) |
Derivatives Not Designated as Hedging Instruments | Foreign currency collars | Other gains and (losses) | ||||
Amount of Gain (Loss) on Derivatives Recognized in Income | ||||
Amount of Gain (Loss) on Derivatives Recognized in Income | 56 | (25) | (95) | (45) |
Derivatives Not Designated as Hedging Instruments | Interest rate swaps | Interest expense | ||||
Amount of Gain (Loss) on Derivatives Recognized in Income | ||||
Amount of Gain (Loss) on Derivatives Recognized in Income | (41) | 27 | (47) | (22) |
Designated as Hedging Instrument | Foreign currency collars | Other gains and (losses) | ||||
Amount of Gain (Loss) on Derivatives Recognized in Income | ||||
Amount of Gain (Loss) on Derivatives Recognized in Income | (5) | (5) | (15) | (4) |
Designated as Hedging Instrument | Interest rate swaps | Interest expense | ||||
Amount of Gain (Loss) on Derivatives Recognized in Income | ||||
Amount of Gain (Loss) on Derivatives Recognized in Income | $ (1) | $ 7 | $ 5 | $ 10 |
Risk Management and Use of De57
Risk Management and Use of Derivative Financial Instruments - Interest Rate Swap and Caps Summary (Details) € in Thousands, $ in Thousands | Jun. 30, 2018USD ($)instrument | Jun. 30, 2018EUR (€)instrument |
Derivative | ||
Fair value | $ 1,334 | |
Interest rate swaps | USD | ||
Derivative | ||
Number of Instruments | instrument | 9 | 9 |
Notional Amount | $ 94,283 | |
Fair value | $ 1,374 | |
Interest rate swaps | Euro | ||
Derivative | ||
Number of Instruments | instrument | 1 | 1 |
Notional Amount | € | € 10,025 | |
Fair value | $ (41) | |
Interest rate caps | USD | ||
Derivative | ||
Number of Instruments | instrument | 2 | 2 |
Notional Amount | $ 11,300 | |
Fair value | $ 1 |
Risk Management and Use of De58
Risk Management and Use of Derivative Financial Instruments - Foreign Currency Derivatives Details (Details) - Designated as Hedging Instrument € in Thousands, kr in Thousands, $ in Thousands | Jun. 30, 2018USD ($)instrument | Jun. 30, 2018NOK (kr)instrument | Jun. 30, 2018EUR (€)instrument |
Foreign currency forward contracts and collars | |||
Derivative | |||
Fair value | $ 394 | ||
Derivatives in Cash Flow Hedging Relationships | Foreign currency collars | Euro | |||
Derivative | |||
Number of Instruments | instrument | 48 | 48 | 48 |
Notional Amount | € | € 31,964 | ||
Fair value | $ (1,789) | ||
Derivatives in Cash Flow Hedging Relationships | Foreign currency forward contracts and collars | Euro | |||
Derivative | |||
Number of Instruments | instrument | 19 | 19 | 19 |
Notional Amount | € | € 7,375 | ||
Fair value | $ 1,598 | ||
Derivatives in Cash Flow Hedging Relationships | Foreign currency forward contracts and collars | NOK | |||
Derivative | |||
Number of Instruments | instrument | 13 | 13 | 13 |
Notional Amount | kr | kr 20,293 | ||
Fair value | $ 559 | ||
Derivatives in Cash Flow Hedging Relationships | Foreign currency collars | NOK | |||
Derivative | |||
Number of Instruments | instrument | 24 | 24 | 24 |
Notional Amount | kr | kr 49,470 | ||
Fair value | $ (79) | ||
Net Investment Hedging | Foreign currency collars | NOK | |||
Derivative | |||
Number of Instruments | instrument | 3 | 3 | 3 |
Notional Amount | kr | kr 16,750 | ||
Fair value | $ 45 | ||
Net Investment Hedging | Foreign currency forward contracts and collars | NOK | |||
Derivative | |||
Number of Instruments | instrument | 2 | 2 | 2 |
Notional Amount | kr | kr 4,504 | ||
Fair value | $ 60 |
Debt, net - Narratives (Details
Debt, net - Narratives (Details) | Jun. 14, 2018USD ($) | May 09, 2018USD ($)propertyextension | Feb. 13, 2018USD ($) | Jun. 30, 2018USD ($)property | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($)property | Jun. 30, 2017USD ($) | Dec. 31, 2017USD ($) | Jul. 31, 2016USD ($) |
Debt Instruments | |||||||||
Debt instrument range, beginning | Dec. 31, 2018 | ||||||||
Debt instrument range, ending | Dec. 31, 2039 | ||||||||
Proceeds from mortgage financing | $ 128,010,000 | $ 32,613,000 | |||||||
Number of properties | property | 59 | 59 | |||||||
Secured debt | $ 1,223,215,000 | $ 1,223,215,000 | $ 1,129,432,000 | ||||||
Debt instrument face amount | $ 50,000,000 | ||||||||
Construction loan | 39,700,000 | 39,700,000 | |||||||
Effect of exchange rate fluctuation | (22,582,000) | $ 19,541,000 | (11,005,000) | 23,697,000 | |||||
Repayments of debt | 22,654,000 | $ 6,323,000 | |||||||
Amounts placed into pledged restricted cash account to cure breach of loan to value covenant | $ 5,600,000 | ||||||||
Restricted cash | 23,706,000 | 23,706,000 | 19,115,000 | ||||||
Long-term debt | |||||||||
Debt Instruments | |||||||||
Effect of exchange rate fluctuation | (13,700,000) | ||||||||
Accounts receivable and other assets, net | |||||||||
Debt Instruments | |||||||||
Restricted cash | $ 5,500,000 | 5,500,000 | |||||||
Agrokor | |||||||||
Debt Instruments | |||||||||
Repayments of debt | 100,000 | $ 1,800,000 | |||||||
Self Storage facility in Southern California | |||||||||
Debt Instruments | |||||||||
Proceeds from mortgage financing | $ 34,000,000 | ||||||||
Number of properties | property | 7 | ||||||||
Secured debt | $ 16,400,000 | ||||||||
Stated interest rate | 4.50% | ||||||||
Debt instrument term | 3 years | ||||||||
Number of extension options | extension | 2 | ||||||||
Student Housing in Portsmouth, United Kingdom | |||||||||
Debt Instruments | |||||||||
Debt instrument term | 1 year 9 months | ||||||||
Debt instrument face amount | $ 48,800,000 | ||||||||
Variable interest rate on debt | 6.00% | ||||||||
Construction loan | $ 29,100,000 | ||||||||
Student Housing in Cardiff, United Kingdom | |||||||||
Debt Instruments | |||||||||
Proceeds from mortgage financing | $ 14,100,000 | ||||||||
Stated interest rate | 7.50% | 7.50% | |||||||
Debt instrument term | 2 years | ||||||||
Hotel in Munich, Germany | |||||||||
Debt Instruments | |||||||||
Proceeds from mortgage financing | $ 52,400,000 | ||||||||
Stated interest rate | 2.80% | 2.80% | |||||||
Debt instrument term | 5 years 4 months 20 days | ||||||||
Fixed Interest Rate | Minimum | |||||||||
Debt Instruments | |||||||||
Mortgage loan on real estate, interest rate | 1.60% | ||||||||
Fixed Interest Rate | Maximum | |||||||||
Debt Instruments | |||||||||
Mortgage loan on real estate, interest rate | 5.80% | ||||||||
Variable Interest Rate | Minimum | |||||||||
Debt Instruments | |||||||||
Mortgage loan on real estate, interest rate | 1.60% | ||||||||
Variable Interest Rate | Maximum | |||||||||
Debt Instruments | |||||||||
Mortgage loan on real estate, interest rate | 8.00% |
Debt - Schedule of Debt Princip
Debt - Schedule of Debt Principal Payments (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Long-term Debt, Fiscal Year Maturity | ||
2018 (remainder) | $ 9,084 | |
2,019 | 58,138 | |
2,020 | 124,786 | |
2,021 | 206,022 | |
2,022 | 195,229 | |
Thereafter through 2039 | 785,278 | |
Long term debt gross | 1,378,537 | |
Unamortized deferred financing costs | (8,250) | |
Unamortized discount, net | 239 | |
Debt, net | $ 1,370,526 | $ 1,275,448 |
Net (Loss) Income Per Share a61
Net (Loss) Income Per Share and Equity - Narratives (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Distributions Declared | |||||
Interest expense | $ 13,294 | $ 11,791 | $ 26,224 | $ 23,244 | |
Dividends payment | Jul. 16, 2018 | ||||
Distributions payable | 21,967 | $ 21,967 | $ 21,686 | ||
Class A | |||||
Distributions Declared | |||||
Interest expense | $ 100 | $ 100 | $ 100 | $ 200 | |
Distributions declared per share (in dollars per share) | $ 0.1563 | $ 0.1563 | $ 0.3126 | $ 0.3126 | |
Class C | |||||
Distributions Declared | |||||
Distributions declared per share (in dollars per share) | $ 0.1378 | $ 0.1382 | $ 0.2753 | $ 0.2762 |
Net (Loss) Income Per Share a62
Net (Loss) Income Per Share and Equity - Basic and Diluted Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Basic and Diluted | ||||
Allocation of Net Loss | $ (334) | $ 5,784 | $ 9,993 | $ 6,405 |
Class A common stock | ||||
Basic and Diluted | ||||
Weighted-Average Shares Outstanding (shares) | 113,010,970 | 109,533,769 | 112,564,943 | 108,998,427 |
Allocation of Net Loss | $ (213) | $ 4,600 | $ 7,901 | $ 5,179 |
Basic and diluted income per share (in dollars per share) | $ 0 | $ 0.04 | $ 0.07 | $ 0.05 |
Class C common stock | ||||
Basic and Diluted | ||||
Weighted-Average Shares Outstanding (shares) | 31,593,597 | 31,030,596 | 31,517,919 | 30,898,107 |
Allocation of Net Loss | $ (121) | $ 1,184 | $ 2,092 | $ 1,226 |
Basic and diluted income per share (in dollars per share) | $ 0 | $ 0.04 | $ 0.07 | $ 0.04 |
Net (Loss) Income Per Share a63
Net (Loss) Income Per Share and Equity - Reclassifications Out of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Reconciliation Of Accumulated Comprehensive Income | ||||
Beginning equity balance, value | $ 872,065 | $ 865,904 | ||
Amounts reclassified from accumulated other comprehensive income (loss) to: | ||||
Interest expense | $ 13,294 | $ 11,791 | 26,224 | 23,244 |
Other Comprehensive (Loss) Income | (19,164) | 15,717 | (8,246) | 19,416 |
Ending equity balance, value | 844,862 | 868,596 | 844,862 | 868,596 |
Accumulated Other Comprehensive Loss | ||||
Reconciliation Of Accumulated Comprehensive Income | ||||
Beginning equity balance, value | (23,911) | (58,535) | (33,212) | (61,704) |
Amounts reclassified from accumulated other comprehensive income (loss) to: | ||||
Ending equity balance, value | (40,749) | (45,083) | (40,749) | (45,083) |
Gains and Losses on Derivative Instruments | ||||
Reconciliation Of Accumulated Comprehensive Income | ||||
Beginning equity balance, value | (1,741) | 5,130 | (1,082) | 5,587 |
Amounts reclassified from accumulated other comprehensive income (loss) to: | ||||
Ending equity balance, value | 1,677 | 1,306 | 1,677 | 1,306 |
Foreign Currency Translation Adjustments | ||||
Reconciliation Of Accumulated Comprehensive Income | ||||
Beginning equity balance, value | (22,170) | (63,665) | (32,130) | (67,291) |
Amounts reclassified from accumulated other comprehensive income (loss) to: | ||||
Ending equity balance, value | (42,426) | (46,389) | (42,426) | (46,389) |
AOCI Including Portion Attributable to Noncontrolling Interest | ||||
Reconciliation Of Accumulated Comprehensive Income | ||||
Other comprehensive income (loss) before reclassifications | (19,037) | 15,942 | (8,165) | 19,873 |
Amounts reclassified from accumulated other comprehensive income (loss) to: | ||||
Other Comprehensive (Loss) Income | (19,164) | 15,717 | (8,246) | 19,416 |
AOCI Including Portion Attributable to Noncontrolling Interest | Reclassification out of Accumulated Other Comprehensive Income | ||||
Amounts reclassified from accumulated other comprehensive income (loss) to: | ||||
Other gains and (losses) | (211) | (411) | (279) | (859) |
Interest expense | 84 | 186 | 198 | 402 |
Gains and (Losses) on Derivative Instruments | ||||
Reconciliation Of Accumulated Comprehensive Income | ||||
Other comprehensive income (loss) before reclassifications | 3,545 | (3,599) | 2,840 | (3,824) |
Amounts reclassified from accumulated other comprehensive income (loss) to: | ||||
Other Comprehensive (Loss) Income | 3,418 | (3,824) | 2,759 | (4,281) |
Gains and (Losses) on Derivative Instruments | Reclassification out of Accumulated Other Comprehensive Income | ||||
Amounts reclassified from accumulated other comprehensive income (loss) to: | ||||
Other gains and (losses) | (211) | (411) | (279) | (859) |
Interest expense | 84 | 186 | 198 | 402 |
Foreign Currency Translation Adjustments | ||||
Reconciliation Of Accumulated Comprehensive Income | ||||
Other comprehensive income (loss) before reclassifications | (22,582) | 19,541 | (11,005) | 23,697 |
Amounts reclassified from accumulated other comprehensive income (loss) to: | ||||
Other Comprehensive (Loss) Income | (22,582) | 19,541 | (11,005) | 23,697 |
Foreign Currency Translation Adjustments | Reclassification out of Accumulated Other Comprehensive Income | ||||
Amounts reclassified from accumulated other comprehensive income (loss) to: | ||||
Other gains and (losses) | 0 | 0 | 0 | 0 |
Interest expense | 0 | 0 | 0 | 0 |
Noncontrolling Interest | ||||
Amounts reclassified from accumulated other comprehensive income (loss) to: | ||||
Net current-period other comprehensive loss (income) attributable to noncontrolling interests | 2,326 | (2,265) | 709 | (2,795) |
Gains and (Losses) on Derivative Instruments | ||||
Amounts reclassified from accumulated other comprehensive income (loss) to: | ||||
Net current-period other comprehensive loss (income) attributable to noncontrolling interests | 0 | 0 | 0 | 0 |
Foreign Currency Translation Adjustments | ||||
Amounts reclassified from accumulated other comprehensive income (loss) to: | ||||
Net current-period other comprehensive loss (income) attributable to noncontrolling interests | $ 2,326 | $ (2,265) | $ 709 | $ (2,795) |
Segment Reporting - Narratives
Segment Reporting - Narratives (Details) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018USD ($)property | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($)segmentproperty | Jun. 30, 2017USD ($) | |
Segment Reporting Information | ||||
Number of properties | property | 59 | 59 | ||
Number of reportable segments | segment | 3 | |||
Multi-family | Multi-family | ||||
Segment Reporting Information | ||||
Number of properties | property | 6 | 6 | ||
Multi-family | Student housing developments | ||||
Segment Reporting Information | ||||
Number of properties | property | 8 | 8 | ||
Net Lease | Operating Segments | ||||
Segment Reporting Information | ||||
Straight line rent adjustment | $ | $ 1.2 | $ 1.1 | $ 2.5 | $ 2.1 |
Net Lease | Operating Segments | Agrokor | ||||
Segment Reporting Information | ||||
Bad debt expense | $ | $ 2.1 | 1 | ||
Net Lease | Operating Segments | Property in Stavanger, Norway | ||||
Segment Reporting Information | ||||
Bad debt expense | $ | $ 0.6 | $ 1.1 |
Segment Reporting - Income Stat
Segment Reporting - Income Statement (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Segment Reporting Information, Profit (Loss) | ||||
Revenues | $ 55,403 | $ 50,973 | $ 109,838 | $ 99,453 |
Operating expenses | (37,119) | (39,130) | (74,389) | (76,105) |
Interest expense | (13,294) | (11,791) | (26,224) | (23,244) |
Other income and (expenses), excluding interest expense | (2,307) | 9,205 | 5,361 | 11,768 |
Benefit from (provision for) income taxes | 298 | (1,123) | 713 | (1,193) |
Net income attributable to noncontrolling interests | (3,315) | (2,350) | (5,306) | (4,274) |
Net (Loss) Income Attributable to CPA:18 – Global | (334) | 5,784 | 9,993 | 6,405 |
Operating Segments | Net Lease | ||||
Segment Reporting Information, Profit (Loss) | ||||
Revenues | 33,299 | 28,882 | 66,291 | 56,252 |
Operating expenses | (19,307) | (18,319) | (38,426) | (34,355) |
Interest expense | (9,002) | (6,999) | (17,860) | (13,994) |
Other income and (expenses), excluding interest expense | 1,555 | 540 | 5,906 | 745 |
Benefit from (provision for) income taxes | 88 | (705) | 233 | (639) |
Net income attributable to noncontrolling interests | (485) | (198) | (579) | (436) |
Net (Loss) Income Attributable to CPA:18 – Global | 6,148 | 3,201 | 15,565 | 7,573 |
Operating Segments | Self Storage | ||||
Segment Reporting Information, Profit (Loss) | ||||
Revenues | 14,398 | 13,856 | 28,371 | 27,049 |
Operating expenses | (8,762) | (11,663) | (18,111) | (23,752) |
Interest expense | (3,288) | (3,039) | (6,382) | (6,044) |
Other income and (expenses), excluding interest expense | (266) | (308) | (745) | (406) |
Benefit from (provision for) income taxes | (28) | (48) | (55) | (125) |
Net (Loss) Income Attributable to CPA:18 – Global | 2,054 | (1,202) | 3,078 | (3,278) |
Operating Segments | Multi-family | ||||
Segment Reporting Information, Profit (Loss) | ||||
Revenues | 5,911 | 6,452 | 11,601 | 12,620 |
Operating expenses | (4,194) | (4,554) | (8,356) | (8,880) |
Interest expense | (923) | (1,434) | (1,828) | (2,586) |
Other income and (expenses), excluding interest expense | 151 | 3 | 152 | 4 |
Benefit from (provision for) income taxes | 47 | (200) | 60 | (227) |
Net income attributable to noncontrolling interests | 0 | 34 | 8 | 23 |
Net (Loss) Income Attributable to CPA:18 – Global | 992 | 301 | 1,637 | 954 |
All Other | ||||
Segment Reporting Information, Profit (Loss) | ||||
Revenues | 1,795 | 1,783 | 3,575 | 3,532 |
Operating expenses | (1) | (2) | (2) | (10) |
Net (Loss) Income Attributable to CPA:18 – Global | 1,794 | 1,781 | 3,573 | 3,522 |
Corporate | ||||
Segment Reporting Information, Profit (Loss) | ||||
Net income attributable to noncontrolling interests | (2,830) | (2,186) | (4,735) | (3,861) |
Unallocated Corporate Overhead | $ (8,492) | $ 3,889 | $ (9,125) | $ 1,495 |
Segment Reporting - Segment Ass
Segment Reporting - Segment Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Segment Reporting Information, Additional Information | ||
Assets | $ 2,398,943 | $ 2,330,997 |
Net Lease | ||
Segment Reporting Information, Additional Information | ||
Assets | 1,546,102 | 1,572,437 |
Self Storage | ||
Segment Reporting Information, Additional Information | ||
Assets | 394,704 | 398,944 |
Multi-family | ||
Segment Reporting Information, Additional Information | ||
Assets | 349,605 | 256,875 |
Corporate | ||
Segment Reporting Information, Additional Information | ||
Assets | 44,161 | 35,812 |
All Other | ||
Segment Reporting Information, Additional Information | ||
Assets | $ 64,371 | $ 66,929 |