Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 03, 2023 | |
Entity Listings [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-35908 | |
Entity Registrant Name | ARMADA HOFFLER PROPERTIES, INC. | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 46-1214914 | |
Entity Address, Address Line One | 222 Central Park Avenue | |
Entity Address, Address Line Two | Suite 2100 | |
Entity Address, City or Town | Virginia Beach | |
Entity Address, State or Province | VA | |
Entity Address, Postal Zip Code | 23462 | |
City Area Code | 757 | |
Local Phone Number | 366-4000 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 67,401,128 | |
Entity Central Index Key | 0001569187 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --12-31 | |
Common stock | ||
Entity Listings [Line Items] | ||
Title of 12(b) Security | Common Stock, $0.01 par value per share | |
Trading Symbol | AHH | |
Security Exchange Name | NYSE | |
Redeemable convertible preferred stock | ||
Entity Listings [Line Items] | ||
Title of 12(b) Security | 6.75% Series A Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value per share | |
Trading Symbol | AHHPrA | |
Security Exchange Name | NYSE |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 | |
Real estate investments: | |||
Income producing property | $ 2,089,170 | $ 1,884,214 | |
Held for development | 6,294 | 6,294 | |
Construction in progress | 91,127 | 53,067 | |
Gross real estate investments | 2,186,591 | 1,943,575 | |
Accumulated depreciation | (376,449) | (329,963) | |
Net real estate investments | 1,810,142 | 1,613,612 | |
Cash and cash equivalents | 32,662 | 48,139 | |
Restricted cash | 2,343 | [1] | 3,726 |
Accounts receivable, net | 43,800 | 39,186 | |
Notes receivable, net | 83,713 | 136,039 | |
Construction receivables, including retentions, net | 87,295 | 70,822 | |
Construction contract costs and estimated earnings in excess of billings | 440 | 342 | |
Equity method investments | 125,672 | 71,983 | |
Operating lease right-of-use assets | 23,152 | 23,350 | |
Finance lease right-of-use assets | 92,570 | 45,878 | |
Acquired lease intangible assets | 127,020 | 103,870 | |
Other assets | 104,275 | 85,363 | |
Total Assets | 2,533,084 | 2,242,310 | |
LIABILITIES AND EQUITY | |||
Indebtedness, net | 1,321,792 | 1,068,261 | |
Accounts payable and accrued liabilities | 31,604 | 26,839 | |
Construction payables, including retentions | 108,107 | 93,472 | |
Billings in excess of construction contract costs and estimated earnings | 23,127 | 17,515 | |
Operating lease liabilities | 31,573 | 31,677 | |
Finance lease liabilities | 93,419 | 46,477 | |
Other liabilities | 56,818 | 54,055 | |
Total Liabilities | 1,666,440 | 1,338,296 | |
Stockholders’ equity: | |||
Preferred stock, $0.01 par value, 100,000,000 shares authorized: 6.75% Series A Cumulative Redeemable Perpetual Preferred Stock, 9,980,000 shares authorized; 6,843,418 shares issued and outstanding as of September 30, 2023 and December 31, 2022 | 171,085 | 171,085 | |
Common stock, $0.01 par value, 500,000,000 shares authorized; 67,885,390 and 67,729,854 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively | 679 | 677 | |
Additional paid-in capital | 589,291 | 587,884 | |
Distributions in excess of earnings | (151,534) | (126,875) | |
Accumulated other comprehensive income | 11,433 | 14,679 | |
Total stockholders’ equity | 620,954 | 647,450 | |
Noncontrolling interests in investment entities | 10,441 | 24,055 | |
Noncontrolling interests in Operating Partnership | 235,249 | 232,509 | |
Total Equity | 866,644 | 904,014 | |
Total Liabilities and Equity | $ 2,533,084 | $ 2,242,310 | |
[1]Restricted cash represents amounts held by lenders for real estate taxes, insurance, and reserves for capital improvements. |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 67,885,390 | 67,729,854 |
Common stock, shares outstanding (in shares) | 67,885,390 | 67,729,854 |
Redeemable convertible preferred stock | ||
Preferred stock, shares authorized (in shares) | 9,980,000 | 9,980,000 |
Preferred Stock dividend rate percentage | 6.75% | 6.75% |
Preferred stock, shares issued (in shares) | 6,843,418 | 6,843,418 |
Preferred stock, shares outstanding (in shares) | 6,843,418 | 6,843,418 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Revenues | ||||
Rental revenues | $ 62,913 | $ 53,743 | $ 179,082 | $ 163,602 |
Revenue, Product and Service [Extensible List] | Real Estate [Member] | Real Estate [Member] | Real Estate [Member] | Real Estate [Member] |
General contracting and real estate services revenues | $ 99,408 | $ 69,024 | $ 286,220 | $ 138,947 |
Interest income | 3,690 | 3,490 | 10,823 | 10,410 |
Total revenues | 166,011 | 126,257 | 476,125 | 312,959 |
Expenses | ||||
Rental expenses | 14,756 | 12,747 | 41,392 | 38,101 |
Real estate taxes | 5,867 | 5,454 | 16,910 | 16,695 |
General contracting and real estate services expenses | 96,095 | 66,252 | 276,336 | 133,491 |
Depreciation and amortization | 22,462 | 17,527 | 60,808 | 54,865 |
Amortization of right-of-use assets - finance leases | 425 | 278 | 1,049 | 833 |
General and administrative expenses | 4,286 | 3,854 | 13,786 | 12,179 |
Acquisition, development, and other pursuit costs | 0 | 0 | 18 | 37 |
Impairment charges | 5 | 0 | 107 | 333 |
Total expenses | 143,896 | 106,112 | 410,406 | 256,534 |
Gain on real estate dispositions, net | 227 | 33,931 | 738 | 53,424 |
Operating income | 22,342 | 54,076 | 66,457 | 109,849 |
Interest expense | (15,444) | (10,345) | (41,375) | (28,747) |
Loss on extinguishment of debt | 0 | (2,123) | 0 | (2,899) |
Change in fair value of derivatives and other | 2,466 | 782 | 5,024 | 7,512 |
Unrealized credit loss (provision) release | (694) | 42 | (871) | (858) |
Other income (expense), net | 63 | 118 | 324 | 415 |
Income before taxes | 8,733 | 42,550 | 29,559 | 85,272 |
Income tax (provision) benefit | (310) | (181) | (834) | 140 |
Net income | 8,423 | 42,369 | 28,725 | 85,412 |
Net income attributable to noncontrolling interests: | ||||
Investment entities | (193) | (5,583) | (616) | (5,811) |
Operating Partnership | (1,290) | (7,909) | (4,597) | (16,571) |
Net income attributable to Armada Hoffler Properties, Inc. | 6,940 | 28,877 | 23,512 | 63,030 |
Preferred stock dividends | (2,887) | (2,887) | (8,661) | (8,661) |
Net income attributable to common stockholders | $ 4,053 | $ 25,990 | $ 14,851 | $ 54,369 |
Net income attributable to common stockholders per share (basic) (in dollars per share) | $ 0.06 | $ 0.38 | $ 0.22 | $ 0.81 |
Net income attributable to common stockholders per share (diluted) (in dollars per share) | $ 0.06 | $ 0.38 | $ 0.22 | $ 0.81 |
Weighted-average common shares outstanding (basic) (in shares) | 67,945 | 67,729 | 67,878 | 67,525 |
Weighted-average common shares outstanding (diluted) (in shares) | 67,945 | 67,729 | 67,878 | 67,525 |
Comprehensive income: | ||||
Net income | $ 8,423 | $ 42,369 | $ 28,725 | $ 85,412 |
Unrealized cash flow hedge gains | 3,488 | 7,108 | 9,868 | 18,780 |
Realized cash flow hedge (gains) losses reclassified to net income | (6,315) | (366) | (14,292) | 1,287 |
Comprehensive income | 5,596 | 49,111 | 24,301 | 105,479 |
Comprehensive income attributable to Armada Hoffler Properties, Inc. | 4,874 | 33,987 | 20,265 | 78,265 |
Investment entities | ||||
Expenses | ||||
Net income | 193 | 5,583 | ||
Comprehensive income: | ||||
Net income | 193 | 5,583 | ||
Unrealized cash flow hedge gains | 86 | 74 | ||
Realized cash flow hedge (gains) losses reclassified to net income | (191) | 1 | ||
Comprehensive income attributable to noncontrolling interests: | (89) | (5,659) | (452) | (5,987) |
Operating Partnership | ||||
Expenses | ||||
Net income | 1,290 | 7,909 | ||
Comprehensive income: | ||||
Net income | 1,290 | 7,909 | ||
Unrealized cash flow hedge gains | 822 | 1,641 | ||
Realized cash flow hedge (gains) losses reclassified to net income | (1,479) | (85) | ||
Comprehensive income attributable to noncontrolling interests: | $ (633) | $ (9,465) | $ (3,584) | $ (21,227) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Equity - USD ($) $ in Thousands | Total | Total stockholders' equity | Preferred stock | Common stock | Additional paid-in capital | Distributions in excess of earnings | Accumulated other comprehensive income | Noncontrolling interests in investment entities | Noncontrolling interests in Operating Partnership |
Beginning balance at Dec. 31, 2021 | $ 779,823 | $ 555,352 | $ 171,085 | $ 630 | $ 525,030 | $ (141,360) | $ (33) | $ 629 | $ 223,842 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 12,276 | 9,993 | 9,993 | 100 | 2,183 | ||||
Unrealized cash flow hedge (losses) gains | 7,722 | 5,907 | 5,907 | 1,815 | |||||
Realized cash flow hedge (gains) losses reclassified to net income | 787 | 602 | 602 | 185 | |||||
Net proceeds from issuance of stock | 65,194 | 65,194 | 45 | 65,149 | |||||
Noncontrolling interest in acquired real estate entity | 23,065 | 23,065 | |||||||
Restricted stock awards, net | 1,064 | 1,064 | 1,064 | ||||||
Acquisitions of noncontrolling interests | (3,901) | (3,901) | (3,901) | ||||||
Redemption of operating partnership units | 0 | 132 | 132 | (132) | |||||
Dividends declared on preferred stock | (2,887) | (2,887) | (2,887) | ||||||
Dividends and distributions declared on common shares and units | (14,939) | (11,433) | (11,433) | (3,506) | |||||
Ending balance at Mar. 31, 2022 | 868,204 | 620,023 | 171,085 | 675 | 587,474 | (145,687) | 6,476 | 23,794 | 224,387 |
Beginning balance at Dec. 31, 2021 | 779,823 | 555,352 | 171,085 | 630 | 525,030 | (141,360) | (33) | 629 | 223,842 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 85,412 | ||||||||
Unrealized cash flow hedge (losses) gains | 18,780 | ||||||||
Realized cash flow hedge (gains) losses reclassified to net income | 1,287 | ||||||||
Ending balance at Sep. 30, 2022 | 910,914 | 652,833 | 171,085 | 677 | 588,707 | (122,838) | 15,202 | 24,187 | 233,894 |
Beginning balance at Mar. 31, 2022 | 868,204 | 620,023 | 171,085 | 675 | 587,474 | (145,687) | 6,476 | 23,794 | 224,387 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 30,767 | 24,160 | 24,160 | 128 | 6,479 | ||||
Unrealized cash flow hedge (losses) gains | 3,950 | 2,986 | 2,986 | 55 | 909 | ||||
Realized cash flow hedge (gains) losses reclassified to net income | 866 | 630 | 1 | 629 | 45 | 191 | |||
Net proceeds from issuance of stock | (35) | (35) | (35) | ||||||
Restricted stock awards, net | 575 | 575 | 2 | 573 | |||||
Contributions from noncontrolling interests | 14 | 14 | |||||||
Distributions to noncontrolling interests | (84) | (84) | |||||||
Dividends declared on preferred stock | (2,887) | (2,887) | (2,887) | ||||||
Dividends and distributions declared on common shares and units | (15,034) | (11,529) | (11,529) | (3,505) | |||||
Ending balance at Jun. 30, 2022 | 886,336 | 633,923 | 171,085 | 677 | 588,012 | (135,942) | 10,091 | 23,952 | 228,461 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 42,369 | 28,877 | 28,877 | 5,583 | 7,909 | ||||
Unrealized cash flow hedge (losses) gains | 7,108 | 5,393 | 5,393 | 74 | 1,641 | ||||
Realized cash flow hedge (gains) losses reclassified to net income | (366) | (282) | (282) | 1 | (85) | ||||
Restricted stock awards, net | 713 | 713 | 713 | ||||||
Redemption of operating partnership units | (130) | (18) | (18) | (112) | |||||
Distributions to noncontrolling interests | (5,423) | (5,423) | |||||||
Dividends declared on preferred stock | (2,887) | (2,887) | (2,887) | ||||||
Dividends and distributions declared on common shares and units | (16,806) | (12,886) | (12,886) | (3,920) | |||||
Ending balance at Sep. 30, 2022 | 910,914 | 652,833 | 171,085 | 677 | 588,707 | (122,838) | 15,202 | 24,187 | 233,894 |
Beginning balance at Dec. 31, 2022 | 904,014 | 647,450 | 171,085 | 677 | 587,884 | (126,875) | 14,679 | 24,055 | 232,509 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 5,417 | 4,709 | 4,709 | 154 | 554 | ||||
Unrealized cash flow hedge (losses) gains | (426) | (328) | (328) | 2 | (100) | ||||
Realized cash flow hedge (gains) losses reclassified to net income | (2,922) | (2,211) | (2,211) | (39) | (672) | ||||
Net proceeds from issuance of stock | (149) | (149) | (149) | ||||||
Restricted stock awards, net | 979 | 979 | 2 | 977 | |||||
Acquisitions of noncontrolling interests | (12,834) | (12,834) | |||||||
Distributions to noncontrolling interests | (506) | (506) | |||||||
Dividends declared on preferred stock | (2,887) | (2,887) | (2,887) | ||||||
Dividends and distributions declared on common shares and units | (16,824) | (12,908) | (12,908) | (3,916) | |||||
Ending balance at Mar. 31, 2023 | 873,862 | 634,655 | 171,085 | 679 | 588,712 | (137,961) | 12,140 | 10,832 | 228,375 |
Beginning balance at Dec. 31, 2022 | 904,014 | 647,450 | 171,085 | 677 | 587,884 | (126,875) | 14,679 | 24,055 | 232,509 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 28,725 | ||||||||
Unrealized cash flow hedge (losses) gains | 9,868 | ||||||||
Realized cash flow hedge (gains) losses reclassified to net income | (14,292) | ||||||||
Ending balance at Sep. 30, 2023 | 866,644 | 620,954 | 171,085 | 679 | 589,291 | (151,534) | 11,433 | 10,441 | 235,249 |
Beginning balance at Mar. 31, 2023 | 873,862 | 634,655 | 171,085 | 679 | 588,712 | (137,961) | 12,140 | 10,832 | 228,375 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 14,885 | 11,863 | 11,863 | 269 | 2,753 | ||||
Unrealized cash flow hedge (losses) gains | 6,806 | 5,093 | 5,093 | 151 | 1,562 | ||||
Realized cash flow hedge (gains) losses reclassified to net income | (5,055) | (3,735) | (3,735) | (174) | (1,146) | ||||
Restricted stock awards, net | 337 | 337 | 337 | ||||||
Issuance of operating partnership units for acquisitions | 12,194 | 12,194 | |||||||
Redemption of operating partnership units | (583) | (19) | (19) | (564) | |||||
Distributions to noncontrolling interests | (427) | (427) | |||||||
Dividends declared on preferred stock | (2,887) | (2,887) | (2,887) | ||||||
Dividends and distributions declared on common shares and units | (17,470) | (13,248) | (13,248) | (4,222) | |||||
Ending balance at Jun. 30, 2023 | 881,662 | 632,059 | 171,085 | 679 | 589,030 | (142,233) | 13,498 | 10,651 | 238,952 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income | 8,423 | 6,940 | 6,940 | 193 | 1,290 | ||||
Unrealized cash flow hedge (losses) gains | 3,488 | 2,580 | 2,580 | 86 | 822 | ||||
Realized cash flow hedge (gains) losses reclassified to net income | (6,315) | (4,645) | (4,645) | (191) | (1,479) | ||||
Net proceeds from issuance of stock | (55) | (55) | (55) | ||||||
Retirement of common stock | (643) | (643) | (1) | (540) | (102) | ||||
Restricted stock awards, net | 867 | 867 | 1 | 866 | |||||
Redemption of operating partnership units | (122) | (10) | (10) | (112) | |||||
Distributions to noncontrolling interests | (298) | (298) | |||||||
Dividends declared on preferred stock | (2,887) | (2,887) | (2,887) | ||||||
Dividends and distributions declared on common shares and units | (17,476) | (13,252) | (13,252) | (4,224) | |||||
Ending balance at Sep. 30, 2023 | $ 866,644 | $ 620,954 | $ 171,085 | $ 679 | $ 589,291 | $ (151,534) | $ 11,433 | $ 10,441 | $ 235,249 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Equity (Parenthetical) - $ / shares | 3 Months Ended | |||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | |
Statement of Stockholders' Equity [Abstract] | ||||||
Dividend declared | $ 0.195 | $ 0.195 | $ 0.19 | $ 0.19 | $ 0.17 | $ 0.17 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | ||
OPERATING ACTIVITIES | |||
Net income | $ 28,725 | $ 85,412 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation of buildings and tenant improvements | 46,742 | 40,770 | |
Amortization of leasing costs, in-place lease intangibles and below market ground rents - operating leases | 14,066 | 14,094 | |
Accrued straight-line rental revenue | (4,748) | (4,542) | |
Amortization of leasing incentives and above or below-market rents | (1,749) | (779) | |
Amortization of right-of-use assets - finance leases | 1,049 | 833 | |
Accrued straight-line ground rent expense | 55 | 97 | |
Unrealized credit loss provision | 871 | 858 | |
Adjustment for uncollectable lease accounts | 1,251 | 441 | |
Noncash stock compensation | 2,951 | 2,712 | |
Impairment charges | 107 | 333 | |
Noncash interest expense | 5,721 | 4,360 | |
Noncash loss on extinguishment of debt | 0 | 2,899 | |
Gain on real estate dispositions, net | (738) | (53,424) | |
Change in fair value of derivatives and other | (1,974) | (7,512) | |
Adjustment for receipts on off-market interest rate derivatives | (3,155) | 0 | |
Changes in operating assets and liabilities: | |||
Property assets | (4,439) | (13,430) | |
Property liabilities | 5,113 | 3,189 | |
Construction assets | (23,531) | (34,971) | |
Construction liabilities | 21,770 | 42,051 | |
Interest receivable | (9,797) | (5,124) | |
Net cash provided by operating activities | 78,290 | 78,267 | |
INVESTING ACTIVITIES | |||
Development of real estate investments | (40,538) | (62,388) | |
Tenant and building improvements | (16,004) | (11,743) | |
Acquisitions of real estate investments, net of cash received | (8,394) | (93,389) | |
Dispositions of real estate investments, net of selling costs | 246 | 251,492 | |
Notes receivable issuances | (42,010) | (24,235) | |
Notes receivable paydowns | 0 | 13,239 | |
Payments to purchase off-market interest rate derivatives | (16,856) | 0 | |
Receipts on off-market interest rate derivatives | 3,155 | 0 | |
Leasing costs | (3,217) | (3,814) | |
Leasing incentives | (20) | (51) | |
Contributions to equity method investments | (53,689) | (51,565) | |
Net cash (used for) provided by investing activities | (177,327) | 17,546 | |
FINANCING ACTIVITIES | |||
Proceeds from issuance of common stock, net of issuance cost | (204) | 65,159 | |
Common shares tendered for tax withholding | (1,111) | (774) | |
Debt issuances, credit facility, and construction loan borrowings | 310,402 | 491,514 | |
Debt and credit facility repayments, including principal amortization | (162,393) | (563,435) | |
Debt issuance costs | (2,839) | (6,727) | |
Acquisition of NCI in consolidated RE investments | 0 | (3,901) | |
Redemption of operating partnership units | (705) | (130) | |
Distributions to noncontrolling interests | (1,231) | (5,507) | |
Contributions from noncontrolling interests | 0 | 14 | |
Dividends and distributions | (59,742) | (52,904) | |
Net cash provided by (used for) financing activities | 82,177 | (76,691) | |
Net (decrease) increase in cash, cash equivalents, and restricted cash | (16,860) | 19,122 | |
Cash, cash equivalents, and restricted cash, beginning of period | 51,865 | 40,443 | |
Cash, cash equivalents, and restricted cash, end of period | [1] | 35,005 | 59,565 |
Supplemental Disclosures (noncash transactions): | |||
Increase in dividends and distributions payable | 683 | 2,536 | |
Increase (decrease) in accrued capital improvements and development costs | 2,033 | (5,139) | |
Increase in settlement liability for the repurchase of common stock | 643 | 0 | |
Issuance of operating partnership units for acquisitions | 12,194 | 0 | |
Operating Partnership units redeemed for common shares | 0 | 132 | |
Debt assumed at fair value in conjunction with real estate purchases | 105,584 | 156,071 | |
Note receivable redeemed in conjunction with real estate purchase | 90,232 | 0 | |
Acquisitions of noncontrolling interests | 12,834 | 0 | |
Noncontrolling interest in acquired real estate entity | 0 | 23,065 | |
Other liability satisfied in connection with a real estate disposal | 750 | 0 | |
Recognition of operating lease right-of-use assets | 0 | 110 | |
Recognition of operating lease liabilities | 0 | 110 | |
Recognition of finance lease right-of-use assets | 47,742 | 0 | |
Recognition of finance lease liabilities | $ 46,616 | $ 0 | |
[1]The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported in the Condensed Consolidated Statements of Cash Flows (in thousands): September 30, 2023 September 30, 2022 Cash and cash equivalents $ 32,662 $ 54,700 Restricted cash (a) 2,343 4,865 Cash, cash equivalents, and restricted cash $ 35,005 $ 59,565 (a) Restricted cash represents amounts held by lenders for real estate taxes, insurance, and reserves for capital improvements. |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | ||
Statement of Cash Flows [Abstract] | ||||||
Cash and cash equivalents | $ 32,662 | $ 48,139 | $ 54,700 | |||
Restricted cash | 2,343 | [1] | 3,726 | 4,865 | [1] | |
Cash, cash equivalents, and restricted cash | $ 35,005 | [2] | $ 51,865 | $ 59,565 | [2] | $ 40,443 |
[1]Restricted cash represents amounts held by lenders for real estate taxes, insurance, and reserves for capital improvements.[2]The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported in the Condensed Consolidated Statements of Cash Flows (in thousands): September 30, 2023 September 30, 2022 Cash and cash equivalents $ 32,662 $ 54,700 Restricted cash (a) 2,343 4,865 Cash, cash equivalents, and restricted cash $ 35,005 $ 59,565 (a) Restricted cash represents amounts held by lenders for real estate taxes, insurance, and reserves for capital improvements. |
Business of Organization
Business of Organization | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business of Organization | Business of Organization Armada Hoffler Properties, Inc. (the "Company") is a vertically integrated, self-managed real estate investment trust ("REIT") with over four decades of experience developing, building, acquiring, and managing high-quality retail, office, and multifamily properties located primarily in the Mid-Atlantic and Southeastern United States. The Company also provides general construction and development services to third-party clients, in addition to developing and building properties to be placed in their stabilized portfolio. The Company is the sole general partner of Armada Hoffler, L.P. (the "Operating Partnership") and, as of September 30, 2023, owned 75.8% of the economic interest in the Operating Partnership, of which 0.1% is held as general partnership units. The operations of the Company are carried on primarily through the Operating Partnership and the wholly owned subsidiaries thereof. As of September 30, 2023, the Company's property portfolio consisted of 59 stabilized operating properties and two properties under development or not stabilized. Refer to Note 5 for information related to the Company's recent acquisitions and dispositions of properties. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Basis of Presentation The accompanying condensed consolidated financial statements were prepared in accordance with U.S. generally accepted accounting principles ("GAAP"). The condensed consolidated financial statements include the financial position and results of operations of the Company and its subsidiaries. The Company’s subsidiaries include the Operating Partnership and the subsidiaries that are wholly owned or in which the Company has a controlling interest, including where the Company has been determined to be a primary beneficiary of a variable interest entity ("VIE") in accordance with the consolidation guidance of the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC"). All significant intercompany transactions and balances have been eliminated in consolidation. In the opinion of management, the condensed consolidated financial statements reflect all adjustments, consisting of normal recurring accruals, which are necessary for the fair presentation of the financial condition, and results of operations for the interim periods presented. The accompanying condensed consolidated financial statements were prepared in accordance with the requirements for interim financial information. Accordingly, these interim financial statements have not been audited and exclude certain disclosures required for annual financial statements. Also, the operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These interim financial statements should be read in conjunction with the audited consolidated financial statements of the Company included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed. Such estimates are based on management’s historical experience and best judgment after considering past, current, and expected events and economic conditions. Actual results could differ significantly from management’s estimates. Reclassifications Certain items have been reclassified from their prior year classifications to conform to the current year presentation. Effective for the nine months ended September 30, 2023, the Company has changed the presentation of its condensed consolidated statements of comprehensive income. For the three and nine months ended September 30, 2022, the Company reclassified interest income of $3.5 million and $10.4 million, respectively, from non-operating income to operating income. As a result, total revenues and operating income increased by $3.5 million and $10.4 million, respectively, compared to previous reporting. These reclassifications had no effect on net income or stockholder's equity as previously reported. Recent Accounting Pronouncements Reference Rate Reform In March 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2020-04 Reference Rate Reform - Facilitation of the Effects of Reference Rate Reform on Financial Reporting (Topic 848), which became effective on March 12, 2020. ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives, and other contracts. This ASU also provides optional expedients to enable companies to continue to apply hedge accounting to certain hedging relationships impacted by reference rate reform. Application of the guidance is optional and only available in certain situations. In January 2021, FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848). The amendments in this standard are elective and principally apply to entities that have derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. Similar to ASU No. 2020-04, provisions of this ASU are effective upon issuance. In December 2022, FASB issued ASU 2022-06 Deferral of the Sunset Date of Topic 848 which became effective immediately upon issuance. ASU 2022-06 deferred the sunset date of Topic 848 to December 31, 2024. During the nine months ended September 30, 2023, the Company elected to apply the practical expedients to modifications of qualifying contracts as continuations of the existing contracts rather than as new contracts. The adoption of the new guidance did not have a material impact on the consolidated financial statements. Derivative Financial Instruments The Company may enter into interest rate derivatives to manage exposure to interest rate risks. The Company does not use derivative financial instruments for trading or speculative purposes. The Company recognizes derivative financial instruments at fair value and presents them within other assets and liabilities in the condensed consolidated balance sheets. Gains and losses from derivatives that are neither designated nor qualify as hedging instruments are recognized within the change in fair value of derivatives and other caption in the condensed consolidated statements of comprehensive income. For derivatives that qualify as cash flow hedges, the gain or loss is reported as a component of other comprehensive income (loss) and reclassified into earnings in the periods during which the hedged forecasted transaction affects earnings. For interest rate caps that qualify as cash flow hedges, the premium paid by the Company at inception represents the time value of the instrument and is excluded from the hedge effectiveness assessment. The excluded component is amortized over the life of the derivative instrument and presented within interest expense in the condensed consolidated statements of comprehensive income. Cash flows for derivative financial instruments are classified as cash flows from operating activities within the condensed consolidated statements of cash flows, unless there is an other-than-insignificant financing element present at inception of the derivative. For derivatives with an other-than-insignificant financing element at inception due to off-market terms, cash flows are classified as cash flows from investing or financing activities within the condensed consolidated statements of cash flows depending on the derivative's off-market nature at inception. Other Accounting Policies See the Company's Annual Report on Form 10-K for the year ended December 31, 2022 for a description of other accounting principles upon which basis the accompanying consolidated financial statements were prepared. |
Segments
Segments | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Segments | Segments The Company operates its business in five reportable segments: (i) retail real estate, (ii) office real estate, (iii) multifamily real estate, (iv) general contracting and real estate services, and (v) real estate financing. Refer to Note 1 of the Company's Form 10-K for the composition of properties within each property segment. Since the Company's Annual Report on Form 10-K for the year ended December 31, 2022, the Company introduced real estate financing as a reportable segment. The real estate financing segment includes the Company's mezzanine loans and preferred equity investments on development projects. The change in segmental presentation is a result of the chief operating decision-maker now separately reviewing the results of the real estate financing investments, which are no longer considered to be ad hoc investments, but an evolving portfolio. Net operating income ("NOI") is the primary measure used by the Company’s chief operating decision-maker to assess segment performance. NOI is calculated as segment revenues less segment expenses. Segment revenues include rental revenues for the property segments, general contracting and real estate services revenues for the general contracting and real estate services segment, and interest income for the real estate financing segment. Segment expenses include rental expenses and real estate taxes for the property segments, general contracting and real estate services expenses for the general contracting and real estate services segment, and interest expense for the real estate financing segment. Segment NOI for the general contracting and real estate services and real estate financing segments is also referred to as segment gross profit as illustrated in the table below. NOI is not a measure of operating income or cash flows from operating activities as measured by GAAP and is not indicative of cash available to fund cash needs. As a result, NOI should not be considered an alternative to cash flows as a measure of liquidity. Not all companies calculate NOI in the same manner. The Company considers NOI to be an appropriate supplemental measure to net income because it assists both investors and management in understanding the core operations of the Company’s real estate, construction, and real estate financing businesses. The following table presents NOI for the Company's five reportable segments for the three and nine months ended September 30, 2023 and 2022 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Retail real estate Rental revenues $ 25,858 $ 21,223 $ 73,004 $ 64,197 Rental expenses 4,125 3,420 11,715 10,254 Real estate taxes 2,312 2,206 6,789 6,715 Segment net operating income 19,421 15,597 54,500 47,228 Office real estate Rental revenues 22,077 18,687 62,156 54,024 Rental expenses 5,925 4,886 16,282 13,626 Real estate taxes 2,262 2,044 6,524 5,583 Segment net operating income 13,890 11,757 39,350 34,815 Multifamily real estate Rental revenues 14,978 13,833 43,922 45,381 Rental expenses 4,706 4,441 13,395 14,221 Real estate taxes 1,293 1,204 3,597 4,397 Segment net operating income 8,979 8,188 26,930 26,763 General contracting and real estate services General contracting and real estate services revenues 99,408 69,024 286,220 138,947 General contracting and real estate services expenses 96,095 66,252 276,336 133,491 Segment gross profit 3,313 2,772 9,884 5,456 Real estate financing Interest income 3,496 3,372 10,257 10,070 Interest expense (a) 728 840 2,634 2,482 Segment gross profit 2,768 2,532 7,623 7,588 Net operating income $ 48,371 $ 40,846 $ 138,287 $ 121,850 ________________________________________ (a) Interest expense within the real estate financing segment is allocated based on the average outstanding principal of notes receivable in the real estate financing portfolio, and the effective interest rate on the credit facility, as defined in Note 8. The following table reconciles NOI to net income, the most directly comparable GAAP measure, for the three and nine months ended September 30, 2023 and 2022 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Net operating income $ 48,371 $ 40,846 $ 138,287 $ 121,850 Interest income (a) 194 118 566 340 Depreciation and amortization (22,462) (17,527) (60,808) (54,865) Amortization of right-of-use assets - finance leases (425) (278) (1,049) (833) General and administrative expenses (4,286) (3,854) (13,786) (12,179) Acquisition, development, and other pursuit costs — — (18) (37) Impairment charges (5) — (107) (333) Gain on real estate dispositions, net 227 33,931 738 53,424 Interest expense (b) (14,716) (9,505) (38,741) (26,265) Loss on extinguishment of debt — (2,123) — (2,899) Change in fair value of derivatives and other 2,466 782 5,024 7,512 Unrealized credit loss (provision) release (694) 42 (871) (858) Other income (expense), net 63 118 324 415 Income tax (provision) benefit (310) (181) (834) 140 Net income $ 8,423 $ 42,369 $ 28,725 $ 85,412 ________________________________________ (a) Excludes real estate financing segment interest income of $3.5 million and $3.4 million for the three months ended September 30, 2023 and 2022, respectively, and $10.3 million and $10.1 million for the nine months ended September 30, 2023 and 2022, respectively. (b) Excludes real estate financing segment interest expense of $0.7 million and $0.8 million for the three months ended September 30, 2023 and 2022, respectively, and $2.6 million and $2.5 million for the nine months ended September 30, 2023 and 2022, respectively. Rental expenses represent costs directly associated with the operation and management of the Company’s real estate properties. Rental expenses include asset management expenses, property management fees, repairs and maintenance, insurance, and utilities. General contracting and real estate services revenues for the three months ended September 30, 2023 and 2022 exclude revenues related to intercompany construction contracts of $13.4 million and $20.8 million, respectively, which are eliminated in consolidation. General contracting and real estate services revenues for the nine months ended September 30, 2023 and 2022 exclude revenues related to intercompany construction contracts of $40.0 million and $43.6 million, respectively. General contracting and real estate services expenses for the three months ended September 30, 2023 and 2022 exclude expenses related to intercompany construction contracts of $13.3 million and $20.6 million, respectively, which are eliminated in consolidation. General contracting and real estate services expenses for the nine months ended September 30, 2023 and 2022 exclude expenses related to intercompany construction contracts of $39.6 million and $43.1 million, respectively. Depreciation and amortization expense for the three months ended September 30, 2023 was $9.9 million, $8.1 million, and $4.3 million for the retail, office, and multifamily real estate segments, respectively. Depreciation and amortization expense for the three months ended September 30, 2022 was $6.9 million, $6.7 million, and $3.8 million for the retail, office, and multifamily real estate segments, respectively. Depreciation and amortization expense for the nine months ended September 30, 2023 was $25.0 million, $22.6 million, and $12.8 million for the retail, office, and multifamily real estate segments, respectively. Depreciation and amortization expense for the nine months ended September 30, 2022 was $21.1 million, $20.2 million, and $13.3 million for the retail, office, and multifamily real estate segments, respectively. General and administrative expenses represent costs not directly associated with the operation and management of the Company’s real estate properties, general contracting and real estate services, and real estate financing businesses. These costs include corporate office personnel compensation and benefits, bank fees, accounting fees, legal fees, and other corporate office expenses. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Leases | Leases Lessee Disclosures As a lessee, the Company has nine ground leases on nine properties. These ground leases have maximum lease terms (including renewal options) that expire between 2074 and 2117. The exercise of lease renewal options is at the Company's sole discretion. The depreciable life of assets and leasehold improvements are limited by the expected lease term. Five of these leases have been classified as operating leases and four of these leases have been classified as finance leases. The Company's lease agreements do not contain any residual value guarantees or material restrictive covenants. Lessor Disclosures As a lessor, the Company leases its properties under operating leases and recognizes base rents on a straight-line basis over the lease term. The Company also recognizes revenue from tenant recoveries, through which tenants reimburse the Company on an accrual basis for certain expenses such as utilities, janitorial services, repairs and maintenance, security and alarms, parking lot and ground maintenance, administrative services, management fees, insurance, and real estate taxes. Rental revenues are reduced by the amount of any leasing incentives amortized on a straight-line basis over the term of the applicable lease. In addition, the Company recognizes contingent rental revenue (e.g., percentage rents based on tenant sales thresholds) when the sales thresholds are met. Many tenant leases include one or more options to renew, with renewal terms that can extend the lease term from one Rental revenue for the three and nine months ended September 30, 2023 and 2022 comprised the following (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Base rent and tenant charges $ 61,021 $ 51,978 $ 172,585 $ 158,281 Accrued straight-line rental adjustment 1,505 1,506 4,748 4,542 Lease incentive amortization (123) (171) (438) (517) (Above) below market lease amortization, net 510 430 2,187 1,296 Total rental revenue $ 62,913 $ 53,743 $ 179,082 $ 163,602 |
Leases | Leases Lessee Disclosures As a lessee, the Company has nine ground leases on nine properties. These ground leases have maximum lease terms (including renewal options) that expire between 2074 and 2117. The exercise of lease renewal options is at the Company's sole discretion. The depreciable life of assets and leasehold improvements are limited by the expected lease term. Five of these leases have been classified as operating leases and four of these leases have been classified as finance leases. The Company's lease agreements do not contain any residual value guarantees or material restrictive covenants. Lessor Disclosures As a lessor, the Company leases its properties under operating leases and recognizes base rents on a straight-line basis over the lease term. The Company also recognizes revenue from tenant recoveries, through which tenants reimburse the Company on an accrual basis for certain expenses such as utilities, janitorial services, repairs and maintenance, security and alarms, parking lot and ground maintenance, administrative services, management fees, insurance, and real estate taxes. Rental revenues are reduced by the amount of any leasing incentives amortized on a straight-line basis over the term of the applicable lease. In addition, the Company recognizes contingent rental revenue (e.g., percentage rents based on tenant sales thresholds) when the sales thresholds are met. Many tenant leases include one or more options to renew, with renewal terms that can extend the lease term from one Rental revenue for the three and nine months ended September 30, 2023 and 2022 comprised the following (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Base rent and tenant charges $ 61,021 $ 51,978 $ 172,585 $ 158,281 Accrued straight-line rental adjustment 1,505 1,506 4,748 4,542 Lease incentive amortization (123) (171) (438) (517) (Above) below market lease amortization, net 510 430 2,187 1,296 Total rental revenue $ 62,913 $ 53,743 $ 179,082 $ 163,602 |
Real Estate Investment
Real Estate Investment | 9 Months Ended |
Sep. 30, 2023 | |
Real Estate [Abstract] | |
Real Estate Investment | Real Estate Investment Property Acquisitions Constellation Energy Building On January 14, 2023, the Company acquired an additional 11% membership interest in the Constellation Energy Building, increasing its ownership interest to 90%, in exchange for full satisfaction of the $12.8 million loan that was extended to the seller upon the acquisition of the property in January 2022. The Interlock On May 19, 2023, the Company acquired The Interlock, a 311,000 square foot Class A commercial mixed-use asset in West Midtown Atlanta anchored by Georgia Tech. The Interlock consists of office and retail space as well as structured parking. For segment reporting purposes, management has separated office and retail components of The Interlock into two operating properties respectively presented in the office and retail real estate segments. The Company acquired the asset for total consideration of $214.1 million plus capitalized acquisition costs of $1.2 million. As part of this acquisition, the Company paid $6.1 million in cash, redeemed its outstanding $90.2 million mezzanine loan, issued $12.2 million of Class A units of limited partnership interest in the Operating Partnership ("Class A Units") to the seller, and assumed the asset's senior construction loan of $105.6 million, that was paid off on the acquisition date using the proceeds of the TD term loan facility and an increase in borrowings under the revolving credit facility, both defined in Note 8. The Company also assumed the leasehold interest in the underlying land owned by Georgia Tech. The ground lease has an expiration in 2117 after considering renewal options. The following table summarizes the purchase price allocation (including acquisition costs) based on the relative fair value of the assets acquired for the operating property purchased during the nine months ended September 30, 2023 (in thousands): The Interlock (1) Building $ 183,907 In-place leases 35,234 Above-market leases 62 Below-market leases (3,931) Finance lease right-of-use assets (2) 46,616 Finance lease liabilities (46,616) Net assets acquired $ 215,272 ________________________________________ (1) The net assets acquired attributable to the office and retail real estate segments were $134.6 million and $80.6 million, respectively. (2) Excludes $1.1 million of rent for the finance lease, which was prepaid on the acquisition date. The total finance lease right-of-use asset recognized on the acquisition date was $47.7 million. Property Disposition Market at Mill Creek On April 11, 2023, the Company completed the sale of a non-operating outparcel at Market at Mill Creek in full satisfaction of the outstanding consideration payable for the acquisition of the noncontrolling interest in the property completed on December 31, 2022. The gain recorded on this disposition was $0.5 million. Brooks Crossing Retail Outparcel On September 20, 2023, the Company exercised its option to purchase an outparcel adjacent to Brooks Crossing Retail and subsequently sold the outparcel. The gain recorded on this disposition was $0.2 million. Equity Method Investments Harbor Point Parcel 3 The Company owns a 50% interest in Harbor Point Parcel 3, a joint venture with Beatty Development Group, for purposes of developing T. Rowe Price's new global headquarters office building in Baltimore, Maryland. The Company is a noncontrolling partner in the joint venture and will serve as the project's general contractor. During the nine months ended September 30, 2023, the Company invested $0.5 million in Harbor Point Parcel 3. The Company has an estimated equity commitment of up to $45.6 million relating to this project. As of September 30, 2023 and December 31, 2022, the carrying value of the Company's investment in Harbor Point Parcel 3 was $40.3 million and $39.8 million, respectively, which excludes $1.8 million and $0.9 million, respectively, of intra-entity profits eliminated in consolidation. For the nine months ended September 30, 2023 and 2022, Harbor Point Parcel 3 had no operating activity; therefore, the Company received no allocated income. Based on the terms of the operating agreement, the Company has concluded that Harbor Point Parcel 3 is a VIE and that the Company holds a variable interest. The Company has significant influence over the project due to its 50% ownership interest; however, the Company does not have the power to direct the activities of the project that most significantly impact its performance. This includes activity as the managing member of the entity, which is a power that is retained by the Company's joint venture partner. Accordingly, the Company is not the project's primary beneficiary and, therefore, does not consolidate Harbor Point Parcel 3 in its consolidated financial statements. The Company's investment in the project is recorded as an equity method investment in the consolidated balance sheets. Harbor Point Parcel 4 On April 1, 2022, the Company acquired a 78% interest in Harbor Point Parcel 4, a real estate venture with Beatty Development Group, for purposes of developing a mixed-use project ("Allied | Harbor Point"), which is planned to include multifamily units, retail space, and a parking garage. The Company holds an option to increase its ownership to 90%. The Company is a noncontrolling partner in the real estate venture and will serve as the project's general contractor. During the nine months ended September 30, 2023, the Company invested $53.2 million in Harbor Point Parcel 4. The Company has an estimated equity commitment of up to $108.9 million relating to this project. As of September 30, 2023 and December 31, 2022, the carrying value of the Company's investment in Harbor Point Parcel 4 was $85.4 million and $32.2 million, respectively, which excludes $0.6 million and $0.2 million, respectively, of intra-entity profits eliminated in consolidation. For the nine months ended September 30, 2023, Harbor Point Parcel 4 had no operating activity; therefore, the Company received no allocated income. Based on the terms of the operating agreement, the Company has concluded that Harbor Point Parcel 4 is a VIE and that the Company holds a variable interest. The Company has significant influence over the project due to its 78% ownership interest; however, the Company does not have the power to direct the activities of the project that most significantly impact its performance. This includes activity as the managing member of the entity, which is a power that is retained by the Company's partner. Accordingly, the Company is not the project's primary beneficiary and, therefore, does not consolidate Harbor Point Parcel 4 in its consolidated financial statements. The Company's investment in the project is recorded as an equity method investment in the consolidated balance sheets. |
Notes Receivable and Current Ex
Notes Receivable and Current Expected Credit Losses | 9 Months Ended |
Sep. 30, 2023 | |
Receivables [Abstract] | |
Notes Receivable and Current Expected Credit Losses | Notes Receivable and Current Expected Credit Losses Notes Receivable The Company had the following notes receivable outstanding as of September 30, 2023 and December 31, 2022 ($ in thousands): Outstanding loan amount Interest compounding Development Project September 30, December 31, Maximum principal commitment Interest rate Solis City Park II $ 23,567 (a) $ 19,062 (a) $ 20,594 13.0 % Annually Solis Gainesville II 21,471 (a) 6,638 (a) 19,595 14.0 % (b) Annually Solis Kennesaw 11,003 (a) — 37,870 14.0 % (b) Annually Solis Peachtree Corners 7,798 (a) — 28,440 15.0 % (b) Annually The Allure at Edinburgh 9,485 (a) — 9,228 15.0 % (c) None The Interlock (d) — 86,584 (a) 107,000 (e) 15.0 % None Total mezzanine & preferred equity 73,324 112,284 $ 222,727 Constellation Energy Building note receivable — 12,834 Other notes receivable 12,033 (a) 11,512 (a) Notes receivable guarantee premium — 701 Allowance for credit losses (f) (1,644) (1,292) Total notes receivable $ 83,713 $ 136,039 ________________________________________ (a) Outstanding loan amounts include any accrued and unpaid interest, and accrued exit fees, as applicable. (b) The interest rate varies over the life of the loans, and the Company also earns an unused commitment fee. Refer below under “Solis Gainesville II,” “Solis Kennesaw,” and “Solis Peachtree Corners” for further details. (c) The interest rate varies over the life of the loan. Refer below under “The Allure at Edinburgh” for further details. (d) This note receivable was redeemed on May 19, 2023 in connection with the Company’s acquisition of The Interlock. Refer below under “The Interlock” for further details. (e) This amount includes interest reserves. (f) The amounts as of September 30, 2023 and December 31, 2022 exclude $0.9 million and $0.3 million of Current Expected Credit Losses (“CECL”) allowance that relates to the unfunded commitments, which were recorded as a liability under other liabilities in the consolidated balance sheets. Interest on the notes receivable is accrued and funded utilizing the interest reserves for each loan, which are components of the respective maximum loan commitments, and such accrued interest is generally added to the loan receivable balances. The Company recognized interest income for the three and nine months ended September 30, 2023 and 2022 as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, Development Project 2023 2022 2023 2022 Nexton Multifamily $ — $ 680 $ — $ 1,966 Solis City Park II 740 (a) 329 (a) 2,142 (a) 554 (a) Solis Gainesville II 717 (a)(b) — 1,964 (a)(b) — Solis Kennesaw 1,164 (a)(b) — 1,629 (a)(b) — Solis Peachtree Corners 617 (a)(b) — 617 (a)(b) — The Allure at Edinburgh 258 — 258 — The Interlock — 2,363 (a) 3,647 (a) 7,550 (a) Total mezzanine & preferred equity 3,496 3,372 10,257 10,070 Other interest income 194 118 566 340 Total interest income $ 3,690 $ 3,490 $ 10,823 $ 10,410 ________________________________________ (a) Includes recognition of interest income related to fee amortization. (b) Includes recognition of unused commitment fees. Solis Gainesville II On March 29, 2023, the Solis Gainesville II preferred equity investment agreement was modified to adjust the interest rate. The interest rate of 14% remains effective through the first 24 months of the investment. Beginning on October 3, 2024, the investment will bear interest at a rate of 10% for 12 months. On October 3, 2025, the investment will again bear interest at a rate of 14% per annum through maturity. Additionally, the amendment introduced an unused commitment fee of 10% on the unfunded portion of the investment's maximum loan commitment, which is effective January 1, 2023. Both the interest and unused commitment fee compound annually. The Interlock On May 19, 2023, the Company acquired The Interlock. The consideration for such acquisition included the redemption of the Company's outstanding $90.2 million mezzanine loan on the project. Refer to Note 5 for further information regarding the acquisition. Solis Kennesaw On May 25, 2023, the Company entered into a $37.9 million preferred equity investment for the development of a multifamily property located in Marietta, Georgia ("Solis Kennesaw"). The investment has economic terms consistent with a note receivable, including a mandatory redemption or maturity on May 25, 2027, and it is accounted for as a note receivable. The Company's investment bears interest at a rate of 14.0% for the first 24 months. Beginning on May 25, 2025, the investment will bear interest at a rate of 9.0% for 12 months. On May 25, 2026, the investment will again bear interest at a rate of 14.0% through maturity. The interest compounds annually. The Company also earns an unused commitment fee of 11.0% on the unfunded portion of the investment's maximum loan commitment, which does not compound, and an equity fee on its commitment of $0.6 million to be amortized through redemption. The preferred equity investment is subject to a minimum interest guarantee of $13.1 million over the life of the investment. Management has concluded that this entity is a VIE. Because the other investor in the project is the developer and managing member of Solis Kennesaw, the Company does not have the power to direct the activities of the project that most significantly impact its performance. Accordingly, the Company is not the project's primary beneficiary and does not consolidate the project in its consolidated financial statements. Solis Peachtree Corners On July 26, 2023, the Company entered into a $28.4 million preferred equity investment for the development of a multifamily property located in Peachtree Corners, Georgia ("Solis Peachtree Corners"). The preferred equity investment has economic and other terms consistent with a note receivable, including a mandatory redemption feature effective on October 27, 2027. The Company's investment bears interest at a rate of 15.0% for the first 27 months. Beginning on November 1, 2025, the investment will bear interest at a rate of 9.0% for 12 months. On November 1, 2026, the investment will again bear interest at a rate of 15.0% through maturity. The interest compounds annually. The Company also earns an unused commitment fee of 10.0% on the unfunded portion of the investment's maximum loan commitment, which also compounds annually, and an equity fee on its commitment of $0.4 million to be amortized through redemption. The preferred equity investment is subject to a minimum interest guarantee of $12.0 million over the life of the investment. Management has concluded that this entity is a VIE. Because the other investor in the project is the developer and managing member of Solis Peachtree Corners, the Company does not have the power to direct the activities of the project that most significantly impact its performance. Accordingly, the Company is not the project's primary beneficiary and does not consolidate the project in its consolidated financial statements. The Allure at Edinburgh On July 26, 2023, the Company entered into a $9.2 million preferred equity investment for the development of a multifamily property located in Chesapeake, Virginia ("The Allure at Edinburgh"). The preferred equity investment has economic and other terms consistent with a note receivable, including a mandatory redemption feature effective on January 16, 2028. The Company's investment bears interest at a rate of 15.0%, which does not compound. Upon The Allure at Edinburgh obtaining a certificate of occupancy, the investment will bear interest at a rate of 10.0%. The common equity partner in the development property holds an option to sell the property to the Company at a predetermined amount if certain conditions are met. The Company also holds an option to purchase the property at any time prior to maturity of the preferred equity investment, and at the same predetermined amount as the common equity partner's option to sell. Management has concluded that this entity is a VIE. Because the other investor in the project is the developer and managing member of The Allure at Edinburgh, the Company does not have the power to direct the activities of the project that most significantly impact its performance. Accordingly, the Company is not the project's primary beneficiary and does not consolidate the project in its consolidated financial statements. Allowance for Loan Losses The Company is exposed to credit losses primarily through its real estate financing investments. As of September 30, 2023, the Company had five real estate financing investments, which are financing development projects in various stages of completion or lease-up. Each of these projects is subject to a loan that is senior to the Company’s loan. Interest on these loans is paid in kind and is generally not expected to be paid until a sale of the project after completion of the development. The Company's management performs a quarterly analysis of the loan portfolio to determine the risk of credit loss based on the progress of development activities, including leasing activities, projected development costs, and current and projected subordinated and senior loan balances. The Company estimates future losses on its notes receivable using risk ratings that correspond to probabilities of default and loss given default. The Company's risk ratings are as follows: • Pass: loans in this category are adequately collateralized by a development project with conditions materially consistent with the Company's underwriting assumptions. • Special Mention: loans in this category show signs that the economic performance of the project may suffer as a result of slower-than-expected leasing activity or an extended development or marketing timeline. Loans in this category warrant increased monitoring by management. • Substandard: loans in this category may not be fully collected by the Company unless remediation actions are taken. Remediation actions may include obtaining additional collateral or assisting the borrower with asset management activities to prepare the project for sale. The Company will also consider placing the loan on non-accrual status if it does not believe that additional interest accruals will ultimately be collected. The Company updated the risk ratings for each of its notes receivable as of September 30, 2023 and obtained industry loan loss data relative to these risk ratings. Each of the outstanding loans as of September 30, 2023 was "Pass" rated. The Company's analysis resulted in an allowance for loan losses of approximately $2.5 million as of September 30, 2023. An allowance related to unfunded commitments of approximately $0.9 million as of September 30, 2023 was recorded as Other liabilities on the consolidated balance sheet. At September 30, 2023, the Company reported $83.7 million of notes receivable, net of allowances of $1.6 million. At December 31, 2022, the Company reported $136.0 million of notes receivable, net of allowances of $1.3 million. Changes in the allowance for the nine months ended September 30, 2023 and 2022 were as follows (in thousands): Nine Months Ended September 30, 2023 Nine Months Ended September 30, 2022 Funded Unfunded Total Funded Unfunded Total Beginning balance $ 1,292 $ 338 $ 1,630 $ 994 $ 10 $ 1,004 Unrealized credit loss provision (release) 817 519 1,336 514 344 858 Release due to redemption (465) — (465) — — — Ending balance $ 1,644 $ 857 $ 2,501 $ 1,508 $ 354 $ 1,862 The Company places loans on non-accrual status when the loan balance, together with the balance of any senior loan, approximately equals the estimated realizable value of the underlying development project. As of December 31, 2022, the Company had the Constellation Energy Building note, which bore interest at 3% per annum, on non-accrual status. The principal balance of the note receivable was adequately secured by the seller's partnership interest. On January 14, 2023, |
Construction Contracts
Construction Contracts | 9 Months Ended |
Sep. 30, 2023 | |
Contractors [Abstract] | |
Construction Contracts | Construction Contracts Construction contract costs and estimated earnings in excess of billings represent reimbursable costs and amounts earned under contracts in progress as of the balance sheet date. Such amounts become billable according to contract terms, which usually consider the passage of time, achievement of certain milestones, or completion of the project. The Company expects to bill and collect substantially all construction contract costs and estimated earnings in excess of billings as of September 30, 2023 during the next 12 to 24 months. Billings in excess of construction contract costs and estimated earnings represent billings or collections on contracts made in advance of revenue recognized. The following table summarizes the changes to the balances in the Company’s construction contract costs and estimated earnings in excess of billings account and the billings in excess of construction contract costs and estimated earnings account for the nine months ended September 30, 2023 and 2022 (in thousands): Nine Months Ended Nine Months Ended Construction contract costs and estimated earnings in excess of billings Billings in excess of construction contract costs and estimated earnings Construction contract costs and estimated earnings in excess of billings Billings in excess of construction contract costs and estimated earnings Beginning balance $ 342 $ 17,515 $ 243 $ 4,881 Revenue recognized that was included in the balance at the beginning of the period — (17,515) — (4,881) Increases due to new billings, excluding amounts recognized as revenue during the period — 24,570 — 16,312 Transferred to receivables (342) — (478) — Construction contract costs and estimated earnings not billed during the period 440 — 232 — Changes due to cumulative catch-up adjustment arising from changes in the estimate of the stage of completion — (1,443) 235 (576) Ending balance $ 440 $ 23,127 $ 232 $ 15,736 The Company defers pre-contract costs when such costs are directly associated with specific anticipated contracts and their recovery is probable. Pre-contract costs of $1.9 million and $1.3 million were deferred as of September 30, 2023 and December 31, 2022, respectively. Amortization of pre-contract costs for the nine months ended September 30, 2023 and 2022 was $0.3 million and $0.8 million, respectively. Construction receivables and payables include retentions, which are amounts that are generally withheld until the completion of the contract or the satisfaction of certain restrictive conditions such as fulfillment guarantees. As of September 30, 2023 and December 31, 2022, construction receivables included retentions of $25.4 million and $8.3 million, respectively. The Company expects to collect substantially all construction receivables outstanding as of September 30, 2023 during the next 12 to 24 months. As of September 30, 2023 and December 31, 2022, construction payables included retentions of $33.5 million and $24.7 million, respectively. The Company expects to pay substantially all construction payables outstanding as of September 30, 2023 during the next 12 to 24 months. The Company’s net position on uncompleted construction contracts comprised the following as of September 30, 2023 and December 31, 2022 (in thousands): September 30, 2023 December 31, 2022 Costs incurred on uncompleted construction contracts $ 595,195 $ 571,465 Estimated earnings 21,997 22,162 Billings (639,879) (610,800) Net position $ (22,687) $ (17,173) Construction contract costs and estimated earnings in excess of billings $ 440 $ 342 Billings in excess of construction contract costs and estimated earnings (23,127) (17,515) Net position $ (22,687) $ (17,173) The above table reflects the net effect of projects closed as of September 30, 2023 and December 31, 2022, respectively. The Company’s balances and changes in construction contract price allocated to unsatisfied performance obligations (backlog) as of September 30, 2023 and 2022 were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Beginning backlog $ 592,787 $ 541,214 $ 665,564 $ 215,518 New contracts/change orders 20,646 53,966 135,414 449,712 Work performed (99,855) (69,251) (287,400) (139,301) Ending backlog $ 513,578 $ 525,929 $ 513,578 $ 525,929 The Company expects to complete a majority of the uncompleted contracts in place as of September 30, 2023 during the next 12 to 24 months. |
Indebtedness
Indebtedness | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Indebtedness | Indebtedness Credit Facility On August 23, 2022, the Company and the Operating Partnership entered into an amended and restated credit agreement (the "Credit Agreement"), which provides for a $550.0 million credit facility comprised of a $250.0 million senior unsecured revolving credit facility (the "revolving credit facility") and a $300.0 million senior unsecured term loan facility (the "term loan facility" and, together with the revolving credit facility, the "credit facility"), with a syndicate of banks. The credit facility includes an accordion feature that allows the total commitments to be increased to $1.0 billion, subject to certain conditions, including obtaining commitments from any one or more lenders. The revolving credit facility has a scheduled maturity date of January 22, 2027, with two six-month extension options, subject to the Company's satisfaction of certain conditions, including payment of a 0.075% extension fee at each extension. The term loan facility has a scheduled maturity date of January 21, 2028. On August 29, 2023, the Company increased the capacity of the revolving credit facility by $105.0 million by exercising the accordion feature in part, bringing the revolving credit facility capacity to $355.0 million and the total credit facility capacity to $655.0 million. The revolving credit facility bears interest at Secured Overnight Financing Rate ("SOFR") plus a margin ranging from 1.30% to 1.85% and a credit spread adjustment of 0.10%, and the term loan facility bears interest at SOFR plus a margin ranging from 1.25% to 1.80% and a credit spread adjustment of 0.10%, in each case depending on the Company's total leverage. The Company is also obligated to pay an unused commitment fee of 15 or 25 basis points on the unused portions of the commitments under the revolving credit facility, depending on the amount of borrowings under the revolving credit facility. If the Company or the Operating Partnership attains investment grade credit ratings from both S&P Global Ratings and Moody's Investors Service, Inc., the Operating Partnership may elect to have borrowings become subject to interest rates based on such credit ratings. As of September 30, 2023 and December 31, 2022, the outstanding balance on the revolving credit facility was $200.0 million and $61.0 million, respectively. The outstanding balance on the term loan facility was $300.0 million as of both September 30, 2023 and December 31, 2022. As of September 30, 2023, the effective interest rates on the revolving credit facility and the term loan facility, before giving effect to interest rate caps and swaps, were 6.82% and 6.72%, respectively. After giving effect to interest rate caps and swaps, the effective interest rates on the revolving credit facility and the term loan facility were 4.40% and 3.02%, respectively, as of September 30, 2023. The Operating Partnership may, at any time, voluntarily prepay any loan under the credit facility in whole or in part without premium or penalty. The Operating Partnership is the borrower, and its obligations under the credit facility are guaranteed by the Company and certain of its subsidiaries that are not otherwise prohibited from providing such guaranty. The Credit Agreement contains customary representations and warranties and financial and other affirmative and negative covenants. The Company's ability to borrow under the credit facility is subject to ongoing compliance with a number of financial covenants, affirmative covenants, and other restrictions. The Credit Agreement includes customary events of default, in certain cases subject to customary cure periods. The occurrence of an event of default, if not cured within the applicable cure period, would permit the lenders to, among other things, declare the unpaid principal, accrued and unpaid interest, and all other amounts payable under the credit facility to be immediately due and payable. M&T Term Loan Facility On December 6, 2022, the Company, as parent guarantor, and the Operating Partnership, as borrower, entered into a term loan agreement (the "M&T term loan agreement") with Manufacturers and Traders Trust Company, as lender and administrative agent, which provides a $100.0 million senior unsecured term loan facility (the "M&T term loan facility"), with the option to increase the total capacity to $200.0 million, subject to the Company's satisfaction of certain conditions. The proceeds from the M&T term loan facility were used to repay the loans secured by the Wills Wharf, 249 Central Park Retail, Fountain Plaza Retail, and South Retail properties. The M&T term loan facility has a scheduled maturity date of March 8, 2027, with a one-year extension option, subject to the Company's satisfaction of certain conditions, including payment of a 0.075% extension fee. The M&T term loan facility bears interest at a rate elected by the Operating Partnership based on term SOFR, Daily Simple SOFR, or the Base Rate (as defined below), and in each case plus a margin. A term SOFR or Daily Simple SOFR loan is also subject to a credit spread adjustment of 0.10%. The margin under each interest rate election depends on the Company's total leverage. The "Base Rate" is equal to the highest of: (a) the rate of interest in effect for such day as publicly announced from time to time by M&T Bank as its “prime rate” for such day, (b) the Federal Funds Rate for such day, plus 0.50%, (c) one month term SOFR for such day plus 100 basis points and (d) 1.00%. The Operating Partnership has elected for the loan to bear interest at term SOFR plus margin. If the Company or the Operating Partnership attains investment grade credit ratings from both S&P Global Ratings and Moody's Investor Service, Inc., the Operating Partnership may elect to have borrowings become subject to interest rates based on such credit ratings. As of each of September 30, 2023 and December 31, 2022, the outstanding balance on the M&T term loan facility was $100.0 million. As of September 30, 2023, the effective interest rate on the M&T term loan facility, before giving effect to interest rate swaps, was 6.72%. After giving effect to interest rate swaps, the effective interest rate on the M&T term loan facility was 4.90% as of September 30, 2023. The Operating Partnership may, at any time, voluntarily prepay the M&T term loan facility in whole or in part without premium or penalty, provided certain conditions are met. The Operating Partnership is the borrower under the M&T term loan facility, and its obligations under the M&T term loan facility are guaranteed by the Company and certain of its subsidiaries that are not otherwise prohibited from providing such guaranty. The M&T term loan agreement contains customary representations and warranties and financial and other affirmative and negative covenants. The Company's ability to borrow under the M&T term loan facility is subject to ongoing compliance with a number of financial covenants, affirmative covenants, and other restrictions. The term loan agreement includes customary events of default, in certain cases subject to customary cure periods. The occurrence of an event of default, if not cured within the applicable cure period, would permit the lenders to, among other things, declare the unpaid principal, accrued and unpaid interest, and all other amounts payable under the M&T term loan facility to be immediately due and payable. TD Term Loan Facility On May 19, 2023, the Company, as parent guarantor, and the Operating Partnership, as borrower, entered into a term loan agreement (the "TD term loan agreement") with Toronto Dominion (Texas) LLC, as administrative agent, and TD Bank, N.A. as lender, which provides a $75.0 million senior unsecured term loan facility (the "TD term loan facility"), with the option to increase the total capacity to $150.0 million, subject to the Company's satisfaction of certain conditions. The proceeds from the TD term loan facility were used in connection with the acquisition of The Interlock, which is detailed in Note 5. The TD term loan facility has a scheduled maturity date of May 19, 2025, with a one-year extension option, subject to the Company's satisfaction of certain conditions, including payment of a 0.15% extension fee. The TD term loan facility bears interest at a rate elected by the Operating Partnership based on term SOFR, Daily Simple SOFR, or the Base Rate (as defined below), and in each case plus a margin. A term SOFR or Daily Simple SOFR loan is also subject to a credit spread adjustment of 0.10%. The margin under each interest rate election depends on the Company's total leverage. The "Base Rate" is equal to the highest of: (a) the Federal Funds Rate for such day, plus 0.50% (b) the rate of interest in effect for such day as publicly announced from time to time by the administrative agent as its “prime rate” for such day, (c) one month term SOFR for such day plus 100 basis points and (d) 1.00%. The Operating Partnership has elected for the loan to bear interest at term SOFR plus margin. If the Company or the Operating Partnership attains investment grade credit ratings from both S&P Global Ratings and Moody's Investor Service, Inc., the Operating Partnership may elect to have borrowings become subject to interest rates based on such credit ratings. On June 29, 2023, the TD term loan facility commitment increased to $95.0 million as a result of the addition of a second lender to the facility. As of September 30, 2023, the outstanding balance on the TD term loan facility was $95.0 million. As of September 30, 2023, the effective interest rate on the TD term loan facility, before giving effect to interest rate swaps, was 6.82%. After giving effect to interest rate swaps, the effective interest rate on the TD term loan facility was 4.70% as of September 30, 2023. The Operating Partnership may, at any time, voluntarily prepay the TD term loan facility in whole or in part without premium or penalty, provided certain conditions are met. The Operating Partnership is the borrower under the TD term loan facility, and its obligations under the TD term loan facility are guaranteed by the Company and certain of its subsidiaries that are not otherwise prohibited from providing such guaranty. The TD term loan agreement contains customary representations and warranties and financial and other affirmative and negative covenants. The Company's ability to borrow under the TD term loan facility is subject to ongoing compliance with a number of financial covenants, affirmative covenants, and other restrictions. The TD term loan agreement includes customary events of default, in certain cases subject to customary cure periods. The occurrence of an event of default, if not cured within the applicable cure period, would permit the lenders to, among other things, declare the unpaid principal, accrued and unpaid interest, and all other amounts payable under the TD term loan facility to be immediately due and payable. The Company is currently in compliance with all covenants under the Credit Agreement, the M&T term loan agreement, and TD term loan agreement, all of which are substantially similar. Other 2023 Financing Activity Effective April 3, 2023, the Company transitioned the $69.0 million loan secured by Thames Street Wharf to SOFR, previously indexed to the Bloomberg Short-Term Yield Index (BSBY). The modified loan bears interest at a rate of SOFR plus a spread of 1.30% and a credit spread adjustment of 0.10%. Effective April 3, 2023, the Company transitioned the $175.0 million loan secured by the Constellation Energy Building to SOFR, previously indexed to BSBY. The modified loan bears interest at a rate of SOFR plus a spread of 1.50% and a credit spread adjustment of 0.11%. During the nine months ended September 30, 2023, the Company borrowed $27.7 million under its existing construction loans to fund new development and construction. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Sep. 30, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments The Company enters into interest rate derivative contracts to manage exposure to interest rate risks. The Company does not use derivative financial instruments for trading or speculative purposes. Derivative financial instruments are recognized at fair value and presented within other assets and other liabilities in the condensed consolidated balance sheets. Gains and losses resulting from changes in the fair value of derivatives that are neither designated nor qualify as hedging instruments are recognized within the change in fair value of derivatives and other in the condensed consolidated statements of comprehensive income. For derivatives that qualify as cash flow hedges, the gain or loss is reported as a component of other comprehensive income (loss) and reclassified into earnings in the periods during which the hedged forecasted transaction affects earnings. As of September 30, 2023, the Company had the following SOFR interest rate caps ($ in thousands): Effective Date Maturity Date Notional Amount Strike Rate Premium Paid 11/1/2020 11/1/2023 $ 84,375 (a) 1.84 % $ 91 7/5/2022 1/1/2024 35,100 (a) 1.00%-3.00% (b) 120 (c) 9/1/2022 9/1/2024 57,089 (a)(d) 1.00%-3.00% (b) 1,370 Total $ 176,564 $ 1,581 ________________________________________ (a) Designated as a cash flow hedge. (b) The Company purchased interest rate caps at 1.00% and sold interest rate caps at 3.00%, resulting in interest rate cap corridors of 1.00% and 3.00%. The intended goal of these corridors is to provide a level of protection from the effect of rising interest rates and reduce the all-in cost of the derivative instrument. (c) This amount represents the sum of the premiums paid on the original instruments. The caps were blended and extended for a net zero premium during the year ended December 31, 2022. (d) Represents the notional amount as of September 30, 2023. The notional amount is scheduled to increase over the term of the corridor in accordance with projected borrowings on the associated loan. The maximum notional amount that will eventually be in effect is $73.6 million. As of September 30, 2023, the Company held the following floating-to-fixed interest rate swaps ($ in thousands): Related Debt Notional Amount Index Swap Fixed Rate Debt effective rate Effective Date Expiration Date Senior unsecured term loan $ 10,500 (a) 1-month SOFR (b) 2.94 % 4.34 % 10/12/2018 10/12/2023 Floating rate pool of loans 50,000 (a)(c) 1-month SOFR 3.40 % 4.91 % 7/5/2023 1/1/2024 Constellation Energy Building 175,000 (a)(d) 1-month SOFR 1.84 % 3.46 % 4/1/2023 2/1/2024 Floating rate pool of loans 200,000 (a)(e) 1-month SOFR 3.39 % 4.90 % 7/1/2023 3/1/2024 Senior unsecured term loan 25,000 (a) 1-month SOFR (b) 0.42 % 1.82 % 4/1/2020 4/1/2024 Senior unsecured term loan 25,000 (a) 1-month SOFR (b) 0.33 % 1.73 % 4/1/2020 4/1/2024 Senior unsecured term loan 25,000 (a) Daily SOFR (b) 0.44 % 1.84 % 4/1/2020 4/1/2024 Harbor Point Parcel 3 senior construction loan 90,000 (f) 1-month SOFR 2.75 % 4.82 % 10/2/2023 10/1/2025 Floating rate pool of loans 330,000 (g) 1-month SOFR 2.75 % 4.26 % 10/1/2023 10/1/2025 Revolving credit facility and TD unsecured term loan 100,000 Daily SOFR 3.20 % 4.70 % 5/19/2023 5/19/2026 (h) Thames Street Wharf 68,253 (a) Daily SOFR (b) 0.93 % 2.33 % 9/30/2021 9/30/2026 M&T unsecured term loan 100,000 (a) 1-month SOFR 3.50 % 4.90 % 12/6/2022 12/6/2027 Senior unsecured term loan 100,000 1-month SOFR 3.43 % 4.83 % 12/13/2022 1/21/2028 Total $ 1,298,753 ________________________________________ (a) Designated as a cash flow hedge. (b) Transitioned to SOFR during the nine months ended September 30, 2023. (c) On July 6, 2023, the Company terminated a SOFR corridor of 1.00%-3.00% with a notional amount of $50.0 million, and entered into this interest rate swap agreement. The Company paid a net zero premium for this transaction. (d) Effective April 4, 2023, the Company terminated its 4.00% BSBY interest rate cap with a notional amount of $175.0 million and its BSBY corridor of 1.00%-3.00% with a notional amount of $175.0 million and, effective April 3, 2023, entered into this interest rate swap agreement. The Company paid a net zero premium for this transaction. (e) On July 5, 2023, the Company terminated a SOFR corridor of 1.00%-3.00% with a notional amount of $200.0 million, and entered into this interest rate swap agreement. The Company paid a net zero premium for this transaction. (f) This interest rate swap agreement reduces the Company's interest rate exposure on the $180.4 million senior construction loan secured by the Company's Harbor Point Parcel 3 equity method investment as described in Note 5 . As such, the loan is not reflected on the Company's consolidated balance sheets. The Company also paid $3.6 million to reduce the swap fixed rate. This interest rate swap agreement was executed in September 2023, but was not effective until October 2, 2023. (g) The Company paid $13.3 million to reduce the swap fixed rate. This interest rate swap agreement was executed in September 2023, but was not effective until October 1, 2023. (h) Subject to cancellation by the counterparty beginning on May 1, 2025 and the first day of each month thereafter. For the interest rate swaps and caps designated as cash flow hedges, realized gains and losses are reclassified out of accumulated other comprehensive income to interest expense in the condensed consolidated statements of comprehensive income due to payments received from and paid to the counterparty. During the next 12 months, the Company anticipates recognizing approximately $11.6 million of net hedging gains as reductions to interest expense. These amounts will be reclassified from accumulated other comprehensive income into earnings to offset the variability of the hedged items during this period. The Company’s derivatives were comprised of the following as of September 30, 2023 and December 31, 2022 (in thousands): September 30, 2023 December 31, 2022 Notional Fair Value Notional Fair Value Asset Liability Asset Liability Derivatives not designated as accounting hedges Interest rate swaps $ 620,000 $ 22,465 $ — $ 250,000 $ 2,201 $ — Interest rate caps — — — 289,479 2,102 — Total derivatives not designated as accounting hedges 620,000 22,465 — 539,479 4,303 — Derivatives designated as accounting hedges Interest rate swaps 678,753 15,777 — 187,670 11,247 — Interest rate caps 176,564 1,680 — 561,200 13,565 — Total derivatives $ 1,475,317 $ 39,922 $ — $ 1,288,349 $ 29,115 $ — The changes in the fair value of the Company’s derivatives during the three and nine months ended September 30, 2023 and 2022 were comprised of the following (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Interest rate swaps $ 4,952 $ 4,330 $ 12,188 $ 13,894 Interest rate caps 20 3,587 (346) 12,586 Total change in fair value of interest rate derivatives $ 4,972 $ 7,917 $ 11,842 $ 26,480 Comprehensive income statement presentation: Change in fair value of derivatives and other $ 1,484 $ 809 $ 1,974 $ 7,700 Unrealized cash flow hedge gains 3,488 7,108 9,868 18,780 Total change in fair value of interest rate derivatives $ 4,972 $ 7,917 $ 11,842 $ 26,480 |
Equity
Equity | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Equity | Equity Stockholders’ Equity On March 10, 2020, the Company commenced an at-the-market continuous equity offering program (the "ATM Program") through which the Company may, from time to time, issue and sell shares of its common stock and shares of its 6.75% Series A Cumulative Redeemable Perpetual Preferred Stock (the "Series A Preferred Stock") having an aggregate offering price of up to $300.0 million, to or through its sales agents and, with respect to shares of its common stock, may enter into separate forward sales agreements to or through the forward purchaser. During the nine months ended September 30, 2023, the Company did not issue any shares of common stock or Series A Preferred Stock under the ATM Program. Shares having an aggregate offering price of $205.0 million remained unsold under the ATM Program as of November 3, 2023. On April 3, 2023, in connection with the tender by a holder of Class A Units of 51,000 Class A Units for redemption by the Operating Partnership, the Company elected to satisfy the redemption request with a cash payment of $0.6 million. On July 14, 2023, in connection with the tender by a holder of Class A Units of 10,146 Class A Units for redemption by the Operating Partnership, the Company elected to satisfy the redemption request with a cash payment of $0.1 million. Noncontrolling Interests As of September 30, 2023 and December 31, 2022, the Company held a 75.8% and 76.7% economic interest in the Operating Partnership, respectively. As of September 30, 2023, the Company also held a preferred interest in the Operating Partnership in the form of preferred units with a liquidation preference of $171.1 million. The Company is the primary beneficiary of the Operating Partnership as it has the power to direct the activities of the Operating Partnership and the rights to absorb 75.8% of the net income of the Operating Partnership. As the primary beneficiary, the Company consolidates the financial position and results of operations of the Operating Partnership. Noncontrolling interests in the Operating Partnership represent units of limited partnership interest in the Operating Partnership not held by the Company. As of September 30, 2023, there were 21,603,062 Class A Units and 39,694 LTIP Units in the Operating Partnership ("LTIP Units") not held by the Company. The Company's financial position and results of operations are the same as those of the Operating Partnership. Additionally, the Operating Partnership owns a majority interest in certain non-wholly owned operating and development properties. The noncontrolling interest for consolidated real estate entities was $10.4 million and $24.1 million as of September 30, 2023 and December 31, 2022, respectively, which represents the minority partners' interest in certain joint venture entities. Share Repurchase Program On June 15, 2023, the Company adopted a $50.0 million share repurchase program (the "Share Repurchase Program"). Under the Share Repurchase Program, the Company may repurchase shares of common stock and Series A Preferred Stock from time to time in the open market, in block purchases, through privately negotiated transactions, the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, or other means. The Share Repurchase Program does not obligate the Company to acquire any specific number of shares or acquire shares over any specific period of time. The Share Repurchase Program may be suspended or discontinued at any time by the Company and does not have an expiration date. During the nine months ended September 30, 2023, the Company repurchased 62,293 shares of common stock. During the nine months ended September 30, 2023, the Company did not repurchase any shares of Series A Preferred Stock. As of September 30, 2023, $49.4 million remained available for repurchases under the Share Repurchase Program. Dividends and Distributions During the nine months ended September 30, 2023, the following dividends/distributions were declared or paid: Equity type Declaration Date Record Date Payment Date Dividends per Share/Unit Aggregate Dividends/Distributions on Stock and Units (in thousands) Common Stock/Class A Units 11/04/2022 12/28/2023 01/05/2023 $ 0.190 $ 16,785 Common Stock/Class A Units 02/28/2023 03/29/2023 04/06/2023 0.190 16,825 Common Stock/Class A Units 05/08/2023 06/28/2023 07/06/2023 0.195 17,471 Common Stock/Class A Units 09/15/2023 09/27/2023 10/05/2023 0.195 17,476 Series A Preferred Stock 11/04/2022 01/03/2023 01/13/2023 0.421875 2,887 Series A Preferred Stock 02/28/2023 04/03/2023 04/14/2023 0.421875 2,887 Series A Preferred Stock 05/08/2023 07/03/2023 07/14/2023 0.421875 2,887 Series A Preferred Stock 09/15/2023 10/02/2023 10/13/2023 0.421875 2,887 |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The Company’s Amended and Restated 2013 Equity Incentive Plan, as amended June 14, 2023 (the "Equity Plan"), permits the grant of restricted stock awards, stock options, stock appreciation rights, performance units, LTIP Units and other equity-based awards up to an aggregate of 3,400,000 shares of common stock. As of September 30, 2023, there were 1,567,039 shares available for issuance under the Equity Plan. During the nine months ended September 30, 2023, the Company granted an aggregate of 432,605 shares of restricted stock and LTIP Units to employees and non-employee directors with a weighted average grant date fair value of $12.47 per share or LTIP Unit. Of those shares, 87,986 were surrendered by the employees for income tax withholdings and 2,800 were forfeited in accordance with service conditions of grants (excluding items noted below). Employee restricted stock awards generally vest over a period of two years: one-third immediately on the grant date and the remaining two-thirds in equal amounts on the first two anniversaries following the grant date, subject to continued service to the Company. Executive officers' restricted shares generally vest over a period of three years: two-fifths immediately on the grant date and the remaining three-fifths in equal amounts on the first three anniversaries following the grant date, subject to continued service to the Company. Non-employee director restricted stock awards or LTIP Units may vest either immediately upon grant or over a period of one year, subject to continued service to the Company. Unvested restricted stock awards and LTIP Units are entitled to receive distributions from their grant date. During the three months ended September 30, 2023 and 2022, the Company recognized $0.9 million and $0.7 million, respectively, of stock-based compensation cost. During the nine months ended September 30, 2023 and 2022, the Company recognized $3.3 million and $3.1 million, respectively, of stock-based compensation cost. As of September 30, 2023, there were 312,233 non-vested restricted shares and LTIP Units outstanding; the total unrecognized compensation expense related to non-vested restricted shares and LTIP Units was $2.4 million, which the Company expects to recognize over the next 30 months. As a result of the Company inadvertently issuing more shares of common stock than were available for issuance under the Equity Plan, on May 9, 2023, the Company's Chief Executive Officer and the Company's Chief Financial Officer forfeited 75,321 and 8,975 restricted shares of common stock, respectively. Following approval by the Company’s board of directors and stockholders of an amendment to the Equity Plan to increase the number of shares available for issuance thereunder, on June 20, 2023, 75,321 and 8,975 restricted shares of common stock were granted to the Company's Chief Executive Officer and the Company's Chief Financial Officer, respectively, one-third of which will vest on March 3, 2024, one-third of which will vest on March 3, 2025, and one-third of which will vest on March 3, 2026, subject to the executives' continued employment on such dates. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value measurements are based on assumptions that market participants would use in pricing an asset or a liability. The hierarchy for inputs used in measuring fair value is as follows: Level 1 — quoted prices in active markets for identical assets or liabilities Level 2 — observable inputs other than quoted prices in active markets for identical assets and liabilities Level 3 — unobservable inputs Except as disclosed below, the carrying amounts of the Company’s financial instruments approximate their fair values. Financial assets and liabilities whose fair values are measured on a recurring basis using Level 2 inputs consist of interest rate swaps and caps. The Company measures the fair values of these assets and liabilities based on prices provided by independent market participants that are based on observable inputs using market-based valuation techniques. Financial assets and liabilities whose fair values are not measured at fair value but for which the fair value is disclosed include the Company's notes receivable and indebtedness. The fair value is estimated by discounting the future cash flows of each instrument at estimated market rates consistent with the maturity, credit characteristics, and other terms of the arrangements, which are Level 3 inputs under the fair value hierarchy. In certain cases, the inputs used to estimate the fair value may fall into different levels of the fair value hierarchy. For disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. Considerable judgment is used to estimate the fair value of financial instruments. The estimates of fair value presented herein are not necessarily indicative of the amounts that could be realized upon disposition of the financial instruments. The carrying amounts and fair values of the Company’s financial instruments as of September 30, 2023 and December 31, 2022 were as follows (in thousands): September 30, 2023 December 31, 2022 Carrying Fair Carrying Fair Indebtedness, net (a) $ 1,333,114 $ 1,307,552 $ 1,079,233 $ 1,058,530 Notes receivable, net 83,713 83,713 136,039 136,039 Interest rate swap and cap assets 39,922 39,922 29,115 29,115 ________________________________________ (a) Excludes $11.3 million and $11.0 million of deferred financing costs as of September 30, 2023 and December 31, 2022, respectively. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The Company provides general contracting services to certain related party entities that are included in these condensed consolidated financial statements. Revenue and gross profit from construction contracts with these entities for the three and nine months ended September 30, 2023 and 2022 were nominal. There were no outstanding construction receivables due from related parties as of September 30, 2023 and December 31, 2022. The Company provides general contracting services to the Harbor Point Parcel 3 and Harbor Point Parcel 4 ventures. See Note 5 for more information. During the three and nine months ended September 30, 2023, the Company recognized gross profit of $0.3 million and $1.0 million, respectively, relating to these construction contracts. During the three and nine months ended September 30, 2022, the Company recognized gross profit of $0.2 million and $0.4 million, respectively, relating to these construction contracts. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Proceedings The Company is from time to time involved in various disputes, lawsuits, warranty claims, environmental and other matters arising in the ordinary course of business. Management makes assumptions and estimates concerning the likelihood and amount of any potential loss relating to these matters. The Company currently is a party to various legal proceedings, none of which management expects will have a material adverse effect on the Company’s financial position, results of operations, or liquidity. Management accrues a liability for litigation if an unfavorable outcome is determined to be probable and the amount of loss can be reasonably estimated. If an unfavorable outcome is determined to be probable and a range of loss can be reasonably estimated, management accrues the best estimate within the range; however, if no amount within the range is a better estimate than any other, the minimum amount within the range is accrued. Legal fees related to litigation are expensed as incurred. Management does not believe that the ultimate outcome of these matters, either individually or in the aggregate, could have a material adverse effect on the Company’s financial position or results of operations; however, litigation is subject to inherent uncertainties. Under the Company’s leases, tenants are typically obligated to indemnify the Company from and against all liabilities, costs, and expenses imposed upon or asserted against it as owner of the properties due to certain matters relating to the operation of the properties by the tenant. Guarantees In connection with certain of the Company's real estate financing activities and equity method investments, the Company has made guarantees to pay portions of certain senior loans of third parties associated with the development projects. As of September 30, 2023, the Company had an outstanding guarantee liability of $0.1 million related to the $32.9 million senior loan on the Harbor Point Parcel 4. As of September 30, 2023, no amounts have been funded on this senior loan. Commitments The Company has a bonding line of credit for its general contracting construction business and is contingently liable under performance and payment bonds, bonds for cancellation of mechanics liens and defect bonds. Such bonds collectively totaled $7.7 million and $8.5 million as of September 30, 2023 and December 31, 2022, respectively. Unfunded Loan Commitments The Company has certain commitments related to its notes receivable investments that it may be required to fund in the future. The Company is generally obligated to fund these commitments at the request of the borrower or upon the occurrence of events outside of the Company's direct control. As of September 30, 2023, the Company had six notes receivable with a total of $52.1 million of unfunded commitments. If commitments are funded in the future, interest will be charged at rates consistent with the existing investments. As of September 30, 2023, the Company has recorded a $0.9 million CECL allowance that relates to the unfunded commitments, which was recorded as a liability in other liabilities in the consolidated balance sheet. See Note 6 for more information. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events The Company has evaluated subsequent events through the date on which this Quarterly Report on Form 10-Q was filed, the date on which these financial statements were issued, and identified the items below for discussion. Indebtedness From October 1, 2023 through November 3, 2023, the Company had net borrowings of $49.0 million on the revolving credit facility. Derivative Financial Instruments On October 11, 2023, the Company entered into an interest rate swap agreement with a notional amount of $100.0 million and a SOFR rate of 2.75%. The interest rate swap is effective November 1, 2023 and will expire on November 1, 2025. The Company paid a $3.9 million premium for this transaction. Equity From October 2, 2023 through October 9, 2023, the Company repurchased 533,699 shares of common stock under the Share Repurchase Program for $5.5 million. As of November 3, 2023, the Company had approximately $43.8 million remaining available for repurchases under the program. On October 2, 2023, in connection with the tender by a holder of Class A Units of 50,000 Class A Units for redemption by the Operating Partnership, the Company elected to satisfy the redemption requests through the issuance of an equal number of shares of common stock. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||||
Net Income (Loss) Attributable to Parent | $ 6,940 | $ 28,877 | $ 23,512 | $ 63,030 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Sep. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements were prepared in accordance with U.S. generally accepted accounting principles ("GAAP"). The condensed consolidated financial statements include the financial position and results of operations of the Company and its subsidiaries. The Company’s subsidiaries include the Operating Partnership and the subsidiaries that are wholly owned or in which the Company has a controlling interest, including where the Company has been determined to be a primary beneficiary of a variable interest entity ("VIE") in accordance with the consolidation guidance of the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC"). All significant intercompany transactions and balances have been eliminated in consolidation. In the opinion of management, the condensed consolidated financial statements reflect all adjustments, consisting of normal recurring accruals, which are necessary for the fair presentation of the financial condition, and results of operations for the interim periods presented. The accompanying condensed consolidated financial statements were prepared in accordance with the requirements for interim financial information. Accordingly, these interim financial statements have not been audited and exclude certain disclosures required for annual financial statements. Also, the operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These interim financial statements should be read in conjunction with the audited consolidated financial statements of the Company included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed. Such estimates are based on management’s historical experience and best judgment after considering past, current, and expected events and economic conditions. Actual results could differ significantly from management’s estimates. |
Reclassifications | Reclassifications Certain items have been reclassified from their prior year classifications to conform to the current year presentation. Effective for the nine months ended September 30, 2023, the Company has changed the presentation of its condensed consolidated statements of comprehensive income. For the three and nine months ended September 30, 2022, the Company reclassified interest income of $3.5 million and $10.4 million, respectively, from non-operating income to operating income. As a result, total revenues and operating income increased by $3.5 million and $10.4 million, respectively, compared to previous reporting. These reclassifications had no effect on net income or stockholder's equity as previously reported. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Reference Rate Reform In March 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2020-04 Reference Rate Reform - Facilitation of the Effects of Reference Rate Reform on Financial Reporting (Topic 848), which became effective on March 12, 2020. ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives, and other contracts. This ASU also provides optional expedients to enable companies to continue to apply hedge accounting to certain hedging relationships impacted by reference rate reform. Application of the guidance is optional and only available in certain situations. In January 2021, FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848). The amendments in this standard are elective and principally apply to entities that have derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. Similar to ASU No. 2020-04, provisions of this ASU are effective upon issuance. In December 2022, FASB issued ASU 2022-06 Deferral of the Sunset Date of Topic 848 which became effective immediately upon issuance. ASU 2022-06 deferred the sunset date of Topic 848 to December 31, 2024. During the nine months ended September 30, 2023, the Company elected to apply the practical expedients to modifications of qualifying contracts as continuations of the existing contracts rather than as new contracts. The adoption of the new guidance did not have a material impact on the consolidated financial statements. |
Derivative Financial Instruments | Derivative Financial Instruments The Company may enter into interest rate derivatives to manage exposure to interest rate risks. The Company does not use derivative financial instruments for trading or speculative purposes. The Company recognizes derivative financial instruments at fair value and presents them within other assets and liabilities in the condensed consolidated balance sheets. Gains and losses from derivatives that are neither designated nor qualify as hedging instruments are recognized within the change in fair value of derivatives and other caption in the condensed consolidated statements of comprehensive income. For derivatives that qualify as cash flow hedges, the gain or loss is reported as a component of other comprehensive income (loss) and reclassified into earnings in the periods during which the hedged forecasted transaction affects earnings. For interest rate caps that qualify as cash flow hedges, the premium paid by the Company at inception represents the time value of the instrument and is excluded from the hedge effectiveness assessment. The excluded component is amortized over the life of the derivative instrument and presented within interest expense in the condensed consolidated statements of comprehensive income. Cash flows for derivative financial instruments are classified as cash flows from operating activities within the condensed consolidated statements of cash flows, unless there is an other-than-insignificant financing element present at inception of the derivative. For derivatives with an other-than-insignificant financing element at inception due to off-market terms, cash flows are classified as cash flows from investing or financing activities within the condensed consolidated statements of cash flows depending on the derivative's off-market nature at inception. |
Segments | Segments The Company operates its business in five reportable segments: (i) retail real estate, (ii) office real estate, (iii) multifamily real estate, (iv) general contracting and real estate services, and (v) real estate financing. Refer to Note 1 of the Company's Form 10-K for the composition of properties within each property segment. Since the Company's Annual Report on Form 10-K for the year ended December 31, 2022, the Company introduced real estate financing as a reportable segment. The real estate financing segment includes the Company's mezzanine loans and preferred equity investments on development projects. The change in segmental presentation is a result of the chief operating decision-maker now separately reviewing the results of the real estate financing investments, which are no longer considered to be ad hoc investments, but an evolving portfolio. Net operating income ("NOI") is the primary measure used by the Company’s chief operating decision-maker to assess segment performance. NOI is calculated as segment revenues less segment expenses. Segment revenues include rental revenues for the property segments, general contracting and real estate services revenues for the general contracting and real estate services segment, and interest income for the real estate financing segment. Segment expenses include rental expenses and real estate taxes for the property segments, general contracting and real estate services expenses for the general contracting and real estate services segment, and interest expense for the real estate financing segment. Segment NOI for the general contracting and real estate services and real estate financing segments is also referred to as segment gross profit as illustrated in the table below. NOI is not a measure of operating income or cash flows from operating activities as measured by GAAP and is not indicative of cash available to fund cash needs. As a result, NOI should not be considered an alternative to cash flows as a measure of liquidity. Not all companies calculate NOI in the same manner. The Company considers NOI to be an appropriate supplemental measure to net income because it assists both investors and management in understanding the core operations of the Company’s real estate, construction, and real estate financing businesses. |
Allowance for Loan Losses | Allowance for Loan Losses The Company is exposed to credit losses primarily through its real estate financing investments. As of September 30, 2023, the Company had five real estate financing investments, which are financing development projects in various stages of completion or lease-up. Each of these projects is subject to a loan that is senior to the Company’s loan. Interest on these loans is paid in kind and is generally not expected to be paid until a sale of the project after completion of the development. The Company's management performs a quarterly analysis of the loan portfolio to determine the risk of credit loss based on the progress of development activities, including leasing activities, projected development costs, and current and projected subordinated and senior loan balances. The Company estimates future losses on its notes receivable using risk ratings that correspond to probabilities of default and loss given default. The Company's risk ratings are as follows: • Pass: loans in this category are adequately collateralized by a development project with conditions materially consistent with the Company's underwriting assumptions. • Special Mention: loans in this category show signs that the economic performance of the project may suffer as a result of slower-than-expected leasing activity or an extended development or marketing timeline. Loans in this category warrant increased monitoring by management. • Substandard: loans in this category may not be fully collected by the Company unless remediation actions are taken. Remediation actions may include obtaining additional collateral or assisting the borrower with asset management activities to prepare the project for sale. The Company will also consider placing the loan on non-accrual status if it does not believe that additional interest accruals will ultimately be collected. |
Construction Contracts | Construction Contracts Construction contract costs and estimated earnings in excess of billings represent reimbursable costs and amounts earned under contracts in progress as of the balance sheet date. Such amounts become billable according to contract terms, which usually consider the passage of time, achievement of certain milestones, or completion of the project. The Company expects to bill and collect substantially all construction contract costs and estimated earnings in excess of billings as of September 30, 2023 during the next 12 to 24 months. Billings in excess of construction contract costs and estimated earnings represent billings or collections on contracts made in advance of revenue recognized. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value measurements are based on assumptions that market participants would use in pricing an asset or a liability. The hierarchy for inputs used in measuring fair value is as follows: Level 1 — quoted prices in active markets for identical assets or liabilities Level 2 — observable inputs other than quoted prices in active markets for identical assets and liabilities Level 3 — unobservable inputs Except as disclosed below, the carrying amounts of the Company’s financial instruments approximate their fair values. Financial assets and liabilities whose fair values are measured on a recurring basis using Level 2 inputs consist of interest rate swaps and caps. The Company measures the fair values of these assets and liabilities based on prices provided by independent market participants that are based on observable inputs using market-based valuation techniques. Financial assets and liabilities whose fair values are not measured at fair value but for which the fair value is disclosed include the Company's notes receivable and indebtedness. The fair value is estimated by discounting the future cash flows of each instrument at estimated market rates consistent with the maturity, credit characteristics, and other terms of the arrangements, which are Level 3 inputs under the fair value hierarchy. In certain cases, the inputs used to estimate the fair value may fall into different levels of the fair value hierarchy. For disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. Considerable judgment is used to estimate the fair value of financial instruments. The estimates of fair value presented herein are not necessarily indicative of the amounts that could be realized upon disposition of the financial instruments. |
Legal Proceedings | Legal Proceedings The Company is from time to time involved in various disputes, lawsuits, warranty claims, environmental and other matters arising in the ordinary course of business. Management makes assumptions and estimates concerning the likelihood and amount of any potential loss relating to these matters. The Company currently is a party to various legal proceedings, none of which management expects will have a material adverse effect on the Company’s financial position, results of operations, or liquidity. Management accrues a liability for litigation if an unfavorable outcome is determined to be probable and the amount of loss can be reasonably estimated. If an unfavorable outcome is determined to be probable and a range of loss can be reasonably estimated, management accrues the best estimate within the range; however, if no amount within the range is a better estimate than any other, the minimum amount within the range is accrued. Legal fees related to litigation are expensed as incurred. Management does not believe that the ultimate outcome of these matters, either individually or in the aggregate, could have a material adverse effect on the Company’s financial position or results of operations; however, litigation is subject to inherent uncertainties. Under the Company’s leases, tenants are typically obligated to indemnify the Company from and against all liabilities, costs, and expenses imposed upon or asserted against it as owner of the properties due to certain matters relating to the operation of the properties by the tenant. |
Segments (Tables)
Segments (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Net Operating Income of Reportable Segments | The following table presents NOI for the Company's five reportable segments for the three and nine months ended September 30, 2023 and 2022 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Retail real estate Rental revenues $ 25,858 $ 21,223 $ 73,004 $ 64,197 Rental expenses 4,125 3,420 11,715 10,254 Real estate taxes 2,312 2,206 6,789 6,715 Segment net operating income 19,421 15,597 54,500 47,228 Office real estate Rental revenues 22,077 18,687 62,156 54,024 Rental expenses 5,925 4,886 16,282 13,626 Real estate taxes 2,262 2,044 6,524 5,583 Segment net operating income 13,890 11,757 39,350 34,815 Multifamily real estate Rental revenues 14,978 13,833 43,922 45,381 Rental expenses 4,706 4,441 13,395 14,221 Real estate taxes 1,293 1,204 3,597 4,397 Segment net operating income 8,979 8,188 26,930 26,763 General contracting and real estate services General contracting and real estate services revenues 99,408 69,024 286,220 138,947 General contracting and real estate services expenses 96,095 66,252 276,336 133,491 Segment gross profit 3,313 2,772 9,884 5,456 Real estate financing Interest income 3,496 3,372 10,257 10,070 Interest expense (a) 728 840 2,634 2,482 Segment gross profit 2,768 2,532 7,623 7,588 Net operating income $ 48,371 $ 40,846 $ 138,287 $ 121,850 ________________________________________ (a) Interest expense within the real estate financing segment is allocated based on the average outstanding principal of notes receivable in the real estate financing portfolio, and the effective interest rate on the credit facility, as defined in Note 8. |
Schedule of Reconciliation of Net Income | The following table reconciles NOI to net income, the most directly comparable GAAP measure, for the three and nine months ended September 30, 2023 and 2022 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Net operating income $ 48,371 $ 40,846 $ 138,287 $ 121,850 Interest income (a) 194 118 566 340 Depreciation and amortization (22,462) (17,527) (60,808) (54,865) Amortization of right-of-use assets - finance leases (425) (278) (1,049) (833) General and administrative expenses (4,286) (3,854) (13,786) (12,179) Acquisition, development, and other pursuit costs — — (18) (37) Impairment charges (5) — (107) (333) Gain on real estate dispositions, net 227 33,931 738 53,424 Interest expense (b) (14,716) (9,505) (38,741) (26,265) Loss on extinguishment of debt — (2,123) — (2,899) Change in fair value of derivatives and other 2,466 782 5,024 7,512 Unrealized credit loss (provision) release (694) 42 (871) (858) Other income (expense), net 63 118 324 415 Income tax (provision) benefit (310) (181) (834) 140 Net income $ 8,423 $ 42,369 $ 28,725 $ 85,412 ________________________________________ (a) Excludes real estate financing segment interest income of $3.5 million and $3.4 million for the three months ended September 30, 2023 and 2022, respectively, and $10.3 million and $10.1 million for the nine months ended September 30, 2023 and 2022, respectively. (b) Excludes real estate financing segment interest expense of $0.7 million and $0.8 million for the three months ended September 30, 2023 and 2022, respectively, and $2.6 million and $2.5 million for the nine months ended September 30, 2023 and 2022, respectively. |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Schedule of Rental Revenue | Rental revenue for the three and nine months ended September 30, 2023 and 2022 comprised the following (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Base rent and tenant charges $ 61,021 $ 51,978 $ 172,585 $ 158,281 Accrued straight-line rental adjustment 1,505 1,506 4,748 4,542 Lease incentive amortization (123) (171) (438) (517) (Above) below market lease amortization, net 510 430 2,187 1,296 Total rental revenue $ 62,913 $ 53,743 $ 179,082 $ 163,602 |
Real Estate Investment (Tables)
Real Estate Investment (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Real Estate [Abstract] | |
Summary of Purchase Price Allocation | The following table summarizes the purchase price allocation (including acquisition costs) based on the relative fair value of the assets acquired for the operating property purchased during the nine months ended September 30, 2023 (in thousands): The Interlock (1) Building $ 183,907 In-place leases 35,234 Above-market leases 62 Below-market leases (3,931) Finance lease right-of-use assets (2) 46,616 Finance lease liabilities (46,616) Net assets acquired $ 215,272 ________________________________________ (1) The net assets acquired attributable to the office and retail real estate segments were $134.6 million and $80.6 million, respectively. (2) Excludes $1.1 million of rent for the finance lease, which was prepaid on the acquisition date. The total finance lease right-of-use asset recognized on the acquisition date was $47.7 million. |
Notes Receivable and Current _2
Notes Receivable and Current Expected Credit Losses (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Receivables [Abstract] | |
Summary of Notes Receivable Outstanding | The Company had the following notes receivable outstanding as of September 30, 2023 and December 31, 2022 ($ in thousands): Outstanding loan amount Interest compounding Development Project September 30, December 31, Maximum principal commitment Interest rate Solis City Park II $ 23,567 (a) $ 19,062 (a) $ 20,594 13.0 % Annually Solis Gainesville II 21,471 (a) 6,638 (a) 19,595 14.0 % (b) Annually Solis Kennesaw 11,003 (a) — 37,870 14.0 % (b) Annually Solis Peachtree Corners 7,798 (a) — 28,440 15.0 % (b) Annually The Allure at Edinburgh 9,485 (a) — 9,228 15.0 % (c) None The Interlock (d) — 86,584 (a) 107,000 (e) 15.0 % None Total mezzanine & preferred equity 73,324 112,284 $ 222,727 Constellation Energy Building note receivable — 12,834 Other notes receivable 12,033 (a) 11,512 (a) Notes receivable guarantee premium — 701 Allowance for credit losses (f) (1,644) (1,292) Total notes receivable $ 83,713 $ 136,039 ________________________________________ (a) Outstanding loan amounts include any accrued and unpaid interest, and accrued exit fees, as applicable. (b) The interest rate varies over the life of the loans, and the Company also earns an unused commitment fee. Refer below under “Solis Gainesville II,” “Solis Kennesaw,” and “Solis Peachtree Corners” for further details. (c) The interest rate varies over the life of the loan. Refer below under “The Allure at Edinburgh” for further details. (d) This note receivable was redeemed on May 19, 2023 in connection with the Company’s acquisition of The Interlock. Refer below under “The Interlock” for further details. (e) This amount includes interest reserves. (f) The amounts as of September 30, 2023 and December 31, 2022 exclude $0.9 million and $0.3 million of Current Expected Credit Losses (“CECL”) allowance that relates to the unfunded commitments, which were recorded as a liability under other liabilities in the consolidated balance sheets. |
Summary of Interest Income | The Company recognized interest income for the three and nine months ended September 30, 2023 and 2022 as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, Development Project 2023 2022 2023 2022 Nexton Multifamily $ — $ 680 $ — $ 1,966 Solis City Park II 740 (a) 329 (a) 2,142 (a) 554 (a) Solis Gainesville II 717 (a)(b) — 1,964 (a)(b) — Solis Kennesaw 1,164 (a)(b) — 1,629 (a)(b) — Solis Peachtree Corners 617 (a)(b) — 617 (a)(b) — The Allure at Edinburgh 258 — 258 — The Interlock — 2,363 (a) 3,647 (a) 7,550 (a) Total mezzanine & preferred equity 3,496 3,372 10,257 10,070 Other interest income 194 118 566 340 Total interest income $ 3,690 $ 3,490 $ 10,823 $ 10,410 ________________________________________ (a) Includes recognition of interest income related to fee amortization. |
Allowance for Credit Losses on Financing Receivables | Changes in the allowance for the nine months ended September 30, 2023 and 2022 were as follows (in thousands): Nine Months Ended September 30, 2023 Nine Months Ended September 30, 2022 Funded Unfunded Total Funded Unfunded Total Beginning balance $ 1,292 $ 338 $ 1,630 $ 994 $ 10 $ 1,004 Unrealized credit loss provision (release) 817 519 1,336 514 344 858 Release due to redemption (465) — (465) — — — Ending balance $ 1,644 $ 857 $ 2,501 $ 1,508 $ 354 $ 1,862 |
Construction Contracts (Tables)
Construction Contracts (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Contractors [Abstract] | |
Summary of Balances and Changes of Construction Contracts | The following table summarizes the changes to the balances in the Company’s construction contract costs and estimated earnings in excess of billings account and the billings in excess of construction contract costs and estimated earnings account for the nine months ended September 30, 2023 and 2022 (in thousands): Nine Months Ended Nine Months Ended Construction contract costs and estimated earnings in excess of billings Billings in excess of construction contract costs and estimated earnings Construction contract costs and estimated earnings in excess of billings Billings in excess of construction contract costs and estimated earnings Beginning balance $ 342 $ 17,515 $ 243 $ 4,881 Revenue recognized that was included in the balance at the beginning of the period — (17,515) — (4,881) Increases due to new billings, excluding amounts recognized as revenue during the period — 24,570 — 16,312 Transferred to receivables (342) — (478) — Construction contract costs and estimated earnings not billed during the period 440 — 232 — Changes due to cumulative catch-up adjustment arising from changes in the estimate of the stage of completion — (1,443) 235 (576) Ending balance $ 440 $ 23,127 $ 232 $ 15,736 The Company’s balances and changes in construction contract price allocated to unsatisfied performance obligations (backlog) as of September 30, 2023 and 2022 were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Beginning backlog $ 592,787 $ 541,214 $ 665,564 $ 215,518 New contracts/change orders 20,646 53,966 135,414 449,712 Work performed (99,855) (69,251) (287,400) (139,301) Ending backlog $ 513,578 $ 525,929 $ 513,578 $ 525,929 |
Schedule of Net Position of Uncompleted Construction Contracts | The Company’s net position on uncompleted construction contracts comprised the following as of September 30, 2023 and December 31, 2022 (in thousands): September 30, 2023 December 31, 2022 Costs incurred on uncompleted construction contracts $ 595,195 $ 571,465 Estimated earnings 21,997 22,162 Billings (639,879) (610,800) Net position $ (22,687) $ (17,173) Construction contract costs and estimated earnings in excess of billings $ 440 $ 342 Billings in excess of construction contract costs and estimated earnings (23,127) (17,515) Net position $ (22,687) $ (17,173) The above table reflects the net effect of projects closed as of September 30, 2023 and December 31, 2022, respectively. |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of LIBOR Interest Rate Caps and Floating to Fixed Interest Rate Swaps | As of September 30, 2023, the Company had the following SOFR interest rate caps ($ in thousands): Effective Date Maturity Date Notional Amount Strike Rate Premium Paid 11/1/2020 11/1/2023 $ 84,375 (a) 1.84 % $ 91 7/5/2022 1/1/2024 35,100 (a) 1.00%-3.00% (b) 120 (c) 9/1/2022 9/1/2024 57,089 (a)(d) 1.00%-3.00% (b) 1,370 Total $ 176,564 $ 1,581 ________________________________________ (a) Designated as a cash flow hedge. (b) The Company purchased interest rate caps at 1.00% and sold interest rate caps at 3.00%, resulting in interest rate cap corridors of 1.00% and 3.00%. The intended goal of these corridors is to provide a level of protection from the effect of rising interest rates and reduce the all-in cost of the derivative instrument. (c) This amount represents the sum of the premiums paid on the original instruments. The caps were blended and extended for a net zero premium during the year ended December 31, 2022. (d) Represents the notional amount as of September 30, 2023. The notional amount is scheduled to increase over the term of the corridor in accordance with projected borrowings on the associated loan. The maximum notional amount that will eventually be in effect is $73.6 million. As of September 30, 2023, the Company held the following floating-to-fixed interest rate swaps ($ in thousands): Related Debt Notional Amount Index Swap Fixed Rate Debt effective rate Effective Date Expiration Date Senior unsecured term loan $ 10,500 (a) 1-month SOFR (b) 2.94 % 4.34 % 10/12/2018 10/12/2023 Floating rate pool of loans 50,000 (a)(c) 1-month SOFR 3.40 % 4.91 % 7/5/2023 1/1/2024 Constellation Energy Building 175,000 (a)(d) 1-month SOFR 1.84 % 3.46 % 4/1/2023 2/1/2024 Floating rate pool of loans 200,000 (a)(e) 1-month SOFR 3.39 % 4.90 % 7/1/2023 3/1/2024 Senior unsecured term loan 25,000 (a) 1-month SOFR (b) 0.42 % 1.82 % 4/1/2020 4/1/2024 Senior unsecured term loan 25,000 (a) 1-month SOFR (b) 0.33 % 1.73 % 4/1/2020 4/1/2024 Senior unsecured term loan 25,000 (a) Daily SOFR (b) 0.44 % 1.84 % 4/1/2020 4/1/2024 Harbor Point Parcel 3 senior construction loan 90,000 (f) 1-month SOFR 2.75 % 4.82 % 10/2/2023 10/1/2025 Floating rate pool of loans 330,000 (g) 1-month SOFR 2.75 % 4.26 % 10/1/2023 10/1/2025 Revolving credit facility and TD unsecured term loan 100,000 Daily SOFR 3.20 % 4.70 % 5/19/2023 5/19/2026 (h) Thames Street Wharf 68,253 (a) Daily SOFR (b) 0.93 % 2.33 % 9/30/2021 9/30/2026 M&T unsecured term loan 100,000 (a) 1-month SOFR 3.50 % 4.90 % 12/6/2022 12/6/2027 Senior unsecured term loan 100,000 1-month SOFR 3.43 % 4.83 % 12/13/2022 1/21/2028 Total $ 1,298,753 ________________________________________ (a) Designated as a cash flow hedge. (b) Transitioned to SOFR during the nine months ended September 30, 2023. (c) On July 6, 2023, the Company terminated a SOFR corridor of 1.00%-3.00% with a notional amount of $50.0 million, and entered into this interest rate swap agreement. The Company paid a net zero premium for this transaction. (d) Effective April 4, 2023, the Company terminated its 4.00% BSBY interest rate cap with a notional amount of $175.0 million and its BSBY corridor of 1.00%-3.00% with a notional amount of $175.0 million and, effective April 3, 2023, entered into this interest rate swap agreement. The Company paid a net zero premium for this transaction. (e) On July 5, 2023, the Company terminated a SOFR corridor of 1.00%-3.00% with a notional amount of $200.0 million, and entered into this interest rate swap agreement. The Company paid a net zero premium for this transaction. (f) This interest rate swap agreement reduces the Company's interest rate exposure on the $180.4 million senior construction loan secured by the Company's Harbor Point Parcel 3 equity method investment as described in Note 5 . As such, the loan is not reflected on the Company's consolidated balance sheets. The Company also paid $3.6 million to reduce the swap fixed rate. This interest rate swap agreement was executed in September 2023, but was not effective until October 2, 2023. (g) The Company paid $13.3 million to reduce the swap fixed rate. This interest rate swap agreement was executed in September 2023, but was not effective until October 1, 2023. (h) Subject to cancellation by the counterparty beginning on May 1, 2025 and the first day of each month thereafter. |
Schedule of Derivatives | The Company’s derivatives were comprised of the following as of September 30, 2023 and December 31, 2022 (in thousands): September 30, 2023 December 31, 2022 Notional Fair Value Notional Fair Value Asset Liability Asset Liability Derivatives not designated as accounting hedges Interest rate swaps $ 620,000 $ 22,465 $ — $ 250,000 $ 2,201 $ — Interest rate caps — — — 289,479 2,102 — Total derivatives not designated as accounting hedges 620,000 22,465 — 539,479 4,303 — Derivatives designated as accounting hedges Interest rate swaps 678,753 15,777 — 187,670 11,247 — Interest rate caps 176,564 1,680 — 561,200 13,565 — Total derivatives $ 1,475,317 $ 39,922 $ — $ 1,288,349 $ 29,115 $ — |
Schedule of Changes in Fair Value of Derivatives | The changes in the fair value of the Company’s derivatives during the three and nine months ended September 30, 2023 and 2022 were comprised of the following (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Interest rate swaps $ 4,952 $ 4,330 $ 12,188 $ 13,894 Interest rate caps 20 3,587 (346) 12,586 Total change in fair value of interest rate derivatives $ 4,972 $ 7,917 $ 11,842 $ 26,480 Comprehensive income statement presentation: Change in fair value of derivatives and other $ 1,484 $ 809 $ 1,974 $ 7,700 Unrealized cash flow hedge gains 3,488 7,108 9,868 18,780 Total change in fair value of interest rate derivatives $ 4,972 $ 7,917 $ 11,842 $ 26,480 |
Equity (Tables)
Equity (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Schedule of Dividends and Distributions | During the nine months ended September 30, 2023, the following dividends/distributions were declared or paid: Equity type Declaration Date Record Date Payment Date Dividends per Share/Unit Aggregate Dividends/Distributions on Stock and Units (in thousands) Common Stock/Class A Units 11/04/2022 12/28/2023 01/05/2023 $ 0.190 $ 16,785 Common Stock/Class A Units 02/28/2023 03/29/2023 04/06/2023 0.190 16,825 Common Stock/Class A Units 05/08/2023 06/28/2023 07/06/2023 0.195 17,471 Common Stock/Class A Units 09/15/2023 09/27/2023 10/05/2023 0.195 17,476 Series A Preferred Stock 11/04/2022 01/03/2023 01/13/2023 0.421875 2,887 Series A Preferred Stock 02/28/2023 04/03/2023 04/14/2023 0.421875 2,887 Series A Preferred Stock 05/08/2023 07/03/2023 07/14/2023 0.421875 2,887 Series A Preferred Stock 09/15/2023 10/02/2023 10/13/2023 0.421875 2,887 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Carrying Amounts and Fair Values of Financial Instruments Measured Based on Level 2 Inputs | The carrying amounts and fair values of the Company’s financial instruments as of September 30, 2023 and December 31, 2022 were as follows (in thousands): September 30, 2023 December 31, 2022 Carrying Fair Carrying Fair Indebtedness, net (a) $ 1,333,114 $ 1,307,552 $ 1,079,233 $ 1,058,530 Notes receivable, net 83,713 83,713 136,039 136,039 Interest rate swap and cap assets 39,922 39,922 29,115 29,115 ________________________________________ (a) Excludes $11.3 million and $11.0 million of deferred financing costs as of September 30, 2023 and December 31, 2022, respectively. |
Business of Organization - Addi
Business of Organization - Additional Information (Details) - property | Sep. 30, 2023 | Dec. 31, 2022 |
Business And Organization [Line Items] | ||
Percentage of operating partnership held | 75.80% | 76.70% |
Operating Property | ||
Business And Organization [Line Items] | ||
Number of real estate properties | 59 | |
Development Property | ||
Business And Organization [Line Items] | ||
Number of real estate properties | 2 | |
General Partner | ||
Business And Organization [Line Items] | ||
Percentage of operating partnership held | 0.10% |
Significant Accounting Polici_3
Significant Accounting Policies (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Reclassification [Line Items] | ||||
Interest income, operating | $ 3,690 | $ 3,490 | $ 10,823 | $ 10,410 |
Revenues | 166,011 | 126,257 | 476,125 | 312,959 |
Operating income | $ 22,342 | 54,076 | $ 66,457 | 109,849 |
Revision of Prior Period, Reclassification, Adjustment | ||||
Reclassification [Line Items] | ||||
Interest income, operating | 3,500 | 10,400 | ||
Interest income, nonoperating | (3,500) | (10,400) | ||
Revenues | 3,500 | 10,400 | ||
Operating income | $ 3,500 | $ 10,400 |
Segments - Additional Informati
Segments - Additional Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) segment | Sep. 30, 2022 USD ($) | |
Segment Reporting Information | ||||
Number of reportable segments | segment | 5 | |||
General contracting and real estate services revenues | $ 99,408 | $ 69,024 | $ 286,220 | $ 138,947 |
Depreciation and amortization | 22,462 | 17,527 | 60,808 | 54,865 |
General contracting and real estate services | ||||
Segment Reporting Information | ||||
General contracting and real estate services revenues | 99,408 | 69,024 | 286,220 | 138,947 |
General contracting and real estate services expenses | 96,095 | 66,252 | 276,336 | 133,491 |
Retail real estate | ||||
Segment Reporting Information | ||||
Depreciation and amortization | 4,300 | 3,800 | 12,800 | 13,300 |
Interest expense | 2,900 | 3,600 | 8,100 | 10,100 |
Office real estate | ||||
Segment Reporting Information | ||||
Depreciation and amortization | 8,100 | 6,700 | 22,600 | 20,200 |
Interest expense | 2,800 | 3,100 | 7,500 | 7,900 |
Multifamily real estate | ||||
Segment Reporting Information | ||||
Depreciation and amortization | 9,900 | 6,900 | 25,000 | 21,100 |
Interest expense | 2,400 | 2,200 | 6,900 | 6,100 |
Intercompany Eliminations | General contracting and real estate services | ||||
Segment Reporting Information | ||||
General contracting and real estate services revenues | 13,400 | 20,800 | 40,000 | 43,600 |
General contracting and real estate services expenses | $ 13,300 | $ 20,600 | $ 39,600 | $ 43,100 |
Segments - Net Income of Report
Segments - Net Income of Reportable Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Segment Reporting Information | ||||
Rental revenues | $ 62,913 | $ 53,743 | $ 179,082 | $ 163,602 |
Rental expenses | 14,756 | 12,747 | 41,392 | 38,101 |
Real estate taxes | 5,867 | 5,454 | 16,910 | 16,695 |
General contracting and real estate services revenues | 99,408 | 69,024 | 286,220 | 138,947 |
Segment gross profit | 48,371 | 40,846 | 138,287 | 121,850 |
Retail real estate | ||||
Segment Reporting Information | ||||
Rental revenues | 25,858 | 21,223 | 73,004 | 64,197 |
Rental expenses | 4,125 | 3,420 | 11,715 | 10,254 |
Real estate taxes | 2,312 | 2,206 | 6,789 | 6,715 |
Interest expense | 2,900 | 3,600 | 8,100 | 10,100 |
Segment gross profit | 19,421 | 15,597 | 54,500 | 47,228 |
Office real estate | ||||
Segment Reporting Information | ||||
Rental revenues | 22,077 | 18,687 | 62,156 | 54,024 |
Rental expenses | 5,925 | 4,886 | 16,282 | 13,626 |
Real estate taxes | 2,262 | 2,044 | 6,524 | 5,583 |
Interest expense | 2,800 | 3,100 | 7,500 | 7,900 |
Segment gross profit | 13,890 | 11,757 | 39,350 | 34,815 |
Multifamily real estate | ||||
Segment Reporting Information | ||||
Rental revenues | 14,978 | 13,833 | 43,922 | 45,381 |
Rental expenses | 4,706 | 4,441 | 13,395 | 14,221 |
Real estate taxes | 1,293 | 1,204 | 3,597 | 4,397 |
Interest expense | 2,400 | 2,200 | 6,900 | 6,100 |
Segment gross profit | 8,979 | 8,188 | 26,930 | 26,763 |
General contracting and real estate services | ||||
Segment Reporting Information | ||||
General contracting and real estate services revenues | 99,408 | 69,024 | 286,220 | 138,947 |
General contracting and real estate services expenses | 96,095 | 66,252 | 276,336 | 133,491 |
Segment gross profit | 3,313 | 2,772 | 9,884 | 5,456 |
Real estate financing | ||||
Segment Reporting Information | ||||
Interest income | 3,496 | 3,372 | 10,257 | 10,070 |
Interest expense | 728 | 840 | 2,634 | 2,482 |
Segment gross profit | $ 2,768 | $ 2,532 | $ 7,623 | $ 7,588 |
Segments - Reconciliation NOI o
Segments - Reconciliation NOI of Net Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Segment Reporting Information | ||||||||
Net operating income | $ 48,371 | $ 40,846 | $ 138,287 | $ 121,850 | ||||
Depreciation and amortization | (22,462) | (17,527) | (60,808) | (54,865) | ||||
Amortization of right-of-use assets - finance leases | (425) | (278) | (1,049) | (833) | ||||
General and administrative expenses | (4,286) | (3,854) | (13,786) | (12,179) | ||||
Acquisition, development, and other pursuit costs | 0 | 0 | (18) | (37) | ||||
Impairment charges | (5) | 0 | (107) | (333) | ||||
Gain on real estate dispositions, net | 227 | 33,931 | 738 | 53,424 | ||||
Interest expense | (15,444) | (10,345) | (41,375) | (28,747) | ||||
Loss on extinguishment of debt | 0 | (2,123) | 0 | (2,899) | ||||
Change in fair value of derivatives and other | 2,466 | 782 | 5,024 | 7,512 | ||||
Unrealized credit loss (provision) release | (694) | 42 | (871) | (858) | ||||
Other income (expense), net | 63 | 118 | 324 | 415 | ||||
Income tax (provision) benefit | (310) | (181) | (834) | 140 | ||||
Net income | 8,423 | $ 14,885 | $ 5,417 | 42,369 | $ 30,767 | $ 12,276 | 28,725 | 85,412 |
Corporate And Reconciling Items | ||||||||
Segment Reporting Information | ||||||||
Interest income | 194 | 118 | 566 | 340 | ||||
Gain on real estate dispositions, net | 227 | 33,931 | 738 | 53,424 | ||||
Interest expense | (14,716) | (9,505) | (38,741) | (26,265) | ||||
Real estate financing | ||||||||
Segment Reporting Information | ||||||||
Net operating income | 2,768 | 2,532 | 7,623 | 7,588 | ||||
Interest income | 3,496 | 3,372 | 10,257 | 10,070 | ||||
Real estate financing | Operating Segments | ||||||||
Segment Reporting Information | ||||||||
Interest income | 3,500 | 3,400 | 10,300 | 10,100 | ||||
Interest expense | $ (700) | $ (800) | $ (2,600) | $ (2,500) |
Leases - Additional Information
Leases - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2023 lease property renewal_option | |
Lessee, Lease, Description [Line Items] | |
Number of ground leases | 9 |
Number of properties subject to ground leases | property | 9 |
Number of operating leases | 5 |
Number of finance leases | 4 |
Number of options to extend, more than | renewal_option | 1 |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Renewal term | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Renewal term | 25 years |
Leases - Lessor, Rental Income
Leases - Lessor, Rental Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Leases [Abstract] | ||||
Base rent and tenant charges | $ 61,021 | $ 51,978 | $ 172,585 | $ 158,281 |
Accrued straight-line rental adjustment | 1,505 | 1,506 | 4,748 | 4,542 |
Lease incentive amortization | (123) | (171) | (438) | (517) |
(Above) below market lease amortization, net | 510 | 430 | 2,187 | 1,296 |
Total rental revenue | $ 62,913 | $ 53,743 | $ 179,082 | $ 163,602 |
Real Estate Investment - Proper
Real Estate Investment - Property Acquisitions (Details) $ in Millions | May 19, 2023 USD ($) ft² property | Jan. 14, 2023 USD ($) |
Constellation Energy Building note receivable | ||
Asset Acquisition [Line Items] | ||
Percentage of economic interest acquired | 11% | |
Percentage of ownership interest | 0.90 | |
Loan issued to seller | $ 12.8 | |
The Interlock | ||
Asset Acquisition [Line Items] | ||
Area of real estate property | ft² | 311,000 | |
Number of properties | property | 2 | |
Consideration transferred | $ 214.1 | |
Acquisition related costs | 1.2 | |
Payments to acquire assets | 6.1 | |
Redemption of mezzanine loan | 90.2 | |
Liabilities incurred | 105.6 | |
The Interlock | Class A units | ||
Asset Acquisition [Line Items] | ||
Equity interest transferred | $ 12.2 |
Real Estate Investment - Purcha
Real Estate Investment - Purchase Price Allocation (Details) - USD ($) $ in Thousands | 9 Months Ended | |||
May 19, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Asset Acquisition [Line Items] | ||||
Finance lease right-of-use assets | $ 47,742 | $ 0 | ||
Finance lease right-of-use assets | 92,570 | $ 45,878 | ||
The Interlock | ||||
Asset Acquisition [Line Items] | ||||
Below-market leases | $ (3,931) | |||
Finance lease right-of-use assets | 46,616 | |||
Finance lease liabilities | (46,616) | |||
Net assets acquired | 215,272 | |||
Prepaid rent liability assumed | 1,100 | |||
Finance lease right-of-use assets | $ 47,700 | |||
The Interlock | Office real estate | ||||
Asset Acquisition [Line Items] | ||||
Net assets acquired | 134,600 | |||
The Interlock | Retail real estate | ||||
Asset Acquisition [Line Items] | ||||
Net assets acquired | 80,600 | |||
The Interlock | In-place leases | ||||
Asset Acquisition [Line Items] | ||||
Finite-lived intangible assets | 35,234 | |||
The Interlock | Above-market leases | ||||
Asset Acquisition [Line Items] | ||||
Finite-lived intangible assets | 62 | |||
The Interlock | Building | ||||
Asset Acquisition [Line Items] | ||||
Building | $ 183,907 |
Real Estate Investment - Prop_2
Real Estate Investment - Property Disposition (Details) - Disposed of by Sale - USD ($) $ in Millions | Sep. 20, 2023 | Apr. 11, 2023 |
Market At Mill Creek | ||
Business Acquisition [Line Items] | ||
Gain on disposition | $ 0.5 | |
Brooks Crossing Retail Outparcel | ||
Business Acquisition [Line Items] | ||
Gain on disposition | $ 0.2 |
Real Estate Investment - Equity
Real Estate Investment - Equity Method Investments (Details) - USD ($) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Apr. 01, 2022 | |
Real Estate [Line Items] | ||||
Investment in equity method investment during period | $ 53,689 | $ 51,565 | ||
Equity method investments | 125,672 | $ 71,983 | ||
Harbor Point Parcel 3 | ||||
Real Estate [Line Items] | ||||
Equity method investments | $ 1,800 | 900 | ||
Harbor Point Parcel 3 | Beatty Development Group | ||||
Real Estate [Line Items] | ||||
Interests in equity method investments | 50% | |||
Investment in equity method investment during period | $ 500 | |||
Maximum commitment | 45,600 | |||
Equity method investments | 40,300 | 39,800 | ||
Harbor Point Parcel 4 | ||||
Real Estate [Line Items] | ||||
Equity method investments | $ 600 | 200 | ||
Harbor Point Parcel 4 | Beatty Development Group | ||||
Real Estate [Line Items] | ||||
Interests in equity method investments | 78% | 78% | ||
Investment in equity method investment during period | $ 53,200 | |||
Maximum commitment | 108,900 | |||
Equity method investments | $ 85,400 | $ 32,200 | ||
Potential increase in ownership percentage | 90% |
Notes Receivable and Current _3
Notes Receivable and Current Expected Credit Losses - Summary of Notes Receivable Outstanding (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Jul. 26, 2023 | May 25, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Notes receivable guarantee premium | $ 0 | $ 701 | ||||
Allowance for credit losses | (1,644) | (1,292) | $ (1,508) | $ (994) | ||
Total notes receivable | 83,713 | 136,039 | ||||
Allowance related to unfunded commitments | 857 | 338 | $ 354 | $ 10 | ||
Other liabilities | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Allowance related to unfunded commitments | 900 | 300 | ||||
The Allure at Edinburgh | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Maximum principal commitment | $ 9,200 | |||||
Mezzanine loan | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Notes receivable | 73,324 | 112,284 | ||||
Maximum principal commitment | 222,727 | |||||
Mezzanine loan | Solis City Park II | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Notes receivable | 23,567 | 19,062 | ||||
Maximum principal commitment | $ 20,594 | |||||
Interest rate | 13% | |||||
Mezzanine loan | Solis Gainesville II | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Notes receivable | $ 21,471 | 6,638 | ||||
Maximum principal commitment | $ 19,595 | |||||
Interest rate | 14% | |||||
Mezzanine loan | Solis Kennesaw | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Notes receivable | $ 11,003 | 0 | ||||
Maximum principal commitment | $ 37,870 | $ 37,900 | ||||
Interest rate | 14% | |||||
Mezzanine loan | Solis Peachtree Corners | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Notes receivable | $ 7,798 | 0 | ||||
Maximum principal commitment | $ 28,440 | $ 28,400 | ||||
Interest rate | 15% | |||||
Mezzanine loan | The Allure at Edinburgh | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Notes receivable | $ 9,485 | 0 | ||||
Maximum principal commitment | $ 9,228 | |||||
Interest rate | 15% | |||||
Mezzanine loan | The Interlock | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Notes receivable | $ 0 | $ 86,584 | ||||
Maximum principal commitment | $ 107,000 | |||||
Interest rate | 15% | |||||
Mezzanine loan | Constellation Energy Building note receivable | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Interest rate | 3% | |||||
Constellation Energy Building note receivable | Constellation Energy Building note receivable | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Notes receivable | $ 0 | $ 12,834 | ||||
Other notes receivable | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Notes receivable | $ 12,033 | $ 11,512 |
Notes Receivable and Current _4
Notes Receivable and Current Expected Credit Losses - Schedule of Interest on the Mezzanine Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest income | $ 3,690 | $ 3,490 | $ 10,823 | $ 10,410 |
Mezzanine loan | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest income | 3,496 | 3,372 | 10,257 | 10,070 |
Other interest income | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest income | 194 | 118 | 566 | 340 |
Nexton Multifamily | Mezzanine loan | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest income | 0 | 680 | 0 | 1,966 |
Solis City Park II | Mezzanine loan | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest income | 740 | 329 | 2,142 | 554 |
Solis Gainesville II | Mezzanine loan | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest income | 717 | 0 | 1,964 | 0 |
Solis Kennesaw | Mezzanine loan | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest income | 1,164 | 0 | 1,629 | 0 |
Solis Peachtree Corners | Mezzanine loan | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest income | 617 | 0 | 617 | 0 |
The Allure at Edinburgh | Mezzanine loan | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest income | 258 | 0 | 258 | 0 |
The Interlock | Mezzanine loan | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest income | $ 0 | $ 2,363 | $ 3,647 | $ 7,550 |
Notes Receivable and Current _5
Notes Receivable and Current Expected Credit Losses - Additional Information (Details) | 9 Months Ended | |||||||||
Jul. 26, 2023 USD ($) | May 25, 2023 USD ($) | May 19, 2023 USD ($) | Sep. 30, 2023 USD ($) investment | Mar. 29, 2023 | Jan. 14, 2023 | Jan. 01, 2023 | Dec. 31, 2022 USD ($) | Sep. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Allowance for loan losses | $ 2,501,000 | $ 1,630,000 | $ 1,862,000 | $ 1,004,000 | ||||||
Allowance related to unfunded commitments | 857,000 | 338,000 | 354,000 | 10,000 | ||||||
Notes receivable, net | 83,713,000 | 136,039,000 | ||||||||
Allowance for credit losses | 1,644,000 | 1,292,000 | $ 1,508,000 | $ 994,000 | ||||||
Notes receivable, nonaccrual status | 0 | |||||||||
Other liabilities | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Allowance related to unfunded commitments | 900,000 | $ 300,000 | ||||||||
Constellation Energy Building note receivable | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Percentage of economic interest acquired | 11% | |||||||||
Percentage of ownership interest | 0.90 | |||||||||
The Interlock | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Redemption of mezzanine loan | $ 90,200,000 | |||||||||
Solis Kennesaw | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Amortized through redemption | $ 600,000 | |||||||||
The Allure at Edinburgh | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Maximum principal commitment | $ 9,200,000 | |||||||||
Mezzanine loan | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Maximum principal commitment | $ 222,727,000 | |||||||||
Number of financial instruments | investment | 5 | |||||||||
Mezzanine loan | Solis Gainesville II | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 14% | |||||||||
Unused commitment fee percentage | 10% | |||||||||
Maximum principal commitment | $ 19,595,000 | |||||||||
Mezzanine loan | Solis Gainesville II | First 24 Months | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 14% | |||||||||
Mezzanine loan | Solis Gainesville II | Twenty Four and Thirty Six Months | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 10% | |||||||||
Mezzanine loan | Solis Gainesville II | Thirty Six Months Through Maturity | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 14% | |||||||||
Mezzanine loan | Solis Kennesaw | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 14% | |||||||||
Unused commitment fee percentage | 11% | |||||||||
Maximum principal commitment | $ 37,900,000 | $ 37,870,000 | ||||||||
Minimum interest | $ 13,100,000 | |||||||||
Mezzanine loan | Solis Kennesaw | First 24 Months | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 14% | |||||||||
Mezzanine loan | Solis Kennesaw | Twenty Four and Thirty Six Months | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 9% | |||||||||
Mezzanine loan | Solis Kennesaw | Thirty Six Months Through Maturity | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 14% | |||||||||
Mezzanine loan | Solis Peachtree Corners | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 15% | |||||||||
Unused commitment fee percentage | 10% | |||||||||
Maximum principal commitment | $ 28,400,000 | $ 28,440,000 | ||||||||
Amortized through redemption | 400,000 | |||||||||
Minimum interest | $ 12,000,000 | |||||||||
Mezzanine loan | Solis Peachtree Corners | First 27 Months | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 15% | |||||||||
Mezzanine loan | Solis Peachtree Corners | Twelve Months Beginning November 2025 | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 9% | |||||||||
Mezzanine loan | Solis Peachtree Corners | November 2026 Through Maturity | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 15% | |||||||||
Mezzanine loan | The Allure at Edinburgh | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 15% | |||||||||
Maximum principal commitment | $ 9,228,000 | |||||||||
Mezzanine loan | The Allure at Edinburgh | Prior To Certificate Of Occupancy | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 15% | |||||||||
Mezzanine loan | The Allure at Edinburgh | After Certificate Of Occupancy | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 10% | |||||||||
Mezzanine loan | Constellation Energy Building note receivable | ||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||||
Interest rate | 3% |
Notes Receivable and Current _6
Notes Receivable and Current Expected Credit Losses - Changes in Allowance for Credit Loss (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Funded | ||
Beginning balance | $ 1,292 | $ 994 |
Unrealized credit loss provision (release) | 817 | 514 |
Release due to redemption | (465) | 0 |
Ending balance | 1,644 | 1,508 |
Unfunded | ||
Beginning balance | 338 | 10 |
Unrealized credit loss provision (release) | 519 | 344 |
Release due to redemption | 0 | 0 |
Ending balance | 857 | 354 |
Total | ||
Beginning balance | 1,630 | 1,004 |
Unrealized credit loss provision (release) | 1,336 | 858 |
Release due to redemption | (465) | 0 |
Ending balance | $ 2,501 | $ 1,862 |
Construction Contracts - Additi
Construction Contracts - Additional Information (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Construction receivables retentions | $ 25.4 | $ 8.3 | |
Construction | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Retentions | 33.5 | 24.7 | |
Portion Attributable To Pending Contracts | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Deferred pre-contract costs | 1.9 | $ 1.3 | |
Amortization of pre-contract costs | $ 0.3 | $ 0.8 | |
Minimum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01 | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Expected completion of contracts | 12 months | ||
Minimum | Construction | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01 | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Expected completion of contracts | 12 months | ||
Maximum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01 | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Expected completion of contracts | 24 months | ||
Maximum | Construction | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01 | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Expected completion of contracts | 24 months |
Construction Contracts - Summar
Construction Contracts - Summary of Costs in Excess of Billings and Billings in Excess of Costs (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Construction contract costs and estimated earnings in excess of billings | ||
Beginning balance | $ 342 | $ 243 |
Transferred to receivables | (342) | (478) |
Construction contract costs and estimated earnings not billed during the period | 440 | 232 |
Changes due to cumulative catch-up adjustment arising from changes in the estimate of the stage of completion | 0 | 235 |
Ending balance | 440 | 232 |
Billings in excess of construction contract costs and estimated earnings | ||
Beginning balance | 17,515 | 4,881 |
Revenue recognized that was included in the balance at the beginning of the period | (17,515) | (4,881) |
Increases due to new billings, excluding amounts recognized as revenue during the period | 24,570 | 16,312 |
Changes due to cumulative catch-up adjustment arising from changes in the estimate of the stage of completion | (1,443) | (576) |
Ending balance | $ 23,127 | $ 15,736 |
Construction Contracts - Summ_2
Construction Contracts - Summary of Net Position (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Contractors [Abstract] | ||||
Costs incurred on uncompleted construction contracts | $ 595,195 | $ 571,465 | ||
Estimated earnings | 21,997 | 22,162 | ||
Billings | (639,879) | (610,800) | ||
Net position | (22,687) | (17,173) | ||
Construction contract costs and estimated earnings in excess of billings | 440 | 342 | $ 232 | $ 243 |
Billings in excess of construction contract costs and estimated earnings | $ (23,127) | $ (17,515) | $ (15,736) | $ (4,881) |
Construction Contracts - Summ_3
Construction Contracts - Summary of Backlog (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Revenue, Remaining Performance Obligation [Roll Forward] | ||||
Beginning backlog | $ 592,787 | $ 541,214 | $ 665,564 | $ 215,518 |
New contracts/change orders | 20,646 | 53,966 | 135,414 | 449,712 |
Work performed | (99,855) | (69,251) | (287,400) | (139,301) |
Ending backlog | $ 513,578 | $ 525,929 | $ 513,578 | $ 525,929 |
Indebtedness (Details)
Indebtedness (Details) | 9 Months Ended | |||||||
Jun. 29, 2023 USD ($) | May 19, 2023 USD ($) | Apr. 03, 2023 USD ($) | Dec. 06, 2022 USD ($) | Aug. 23, 2022 USD ($) extension_option | Sep. 30, 2023 USD ($) | Aug. 29, 2023 USD ($) | Dec. 31, 2022 USD ($) | |
Indebtedness | ||||||||
Notional Amount | $ 1,475,317,000 | $ 1,288,349,000 | ||||||
Interest rate caps | ||||||||
Indebtedness | ||||||||
Notional Amount | $ 176,564,000 | |||||||
Minimum | Interest rate caps | ||||||||
Indebtedness | ||||||||
Interest rate cap (in percent) | 1% | |||||||
Maximum | Interest rate caps | ||||||||
Indebtedness | ||||||||
Interest rate cap (in percent) | 3% | |||||||
Line of Credit | Amended And Restated Credit Agreement | ||||||||
Indebtedness | ||||||||
Aggregate capacity under the credit facility | $ 550,000,000 | |||||||
Accordion feature maximum borrowing capacity | 1,000,000,000 | |||||||
Line of Credit | M&T Term Loan Agreement | ||||||||
Indebtedness | ||||||||
Aggregate capacity under the credit facility | $ 100,000,000 | |||||||
Accordion feature maximum borrowing capacity | $ 200,000,000 | |||||||
Line of Credit | TD Term Loan Facility | ||||||||
Indebtedness | ||||||||
Aggregate capacity under the credit facility | $ 75,000,000 | |||||||
Accordion feature maximum borrowing capacity | $ 150,000,000 | |||||||
Line of Credit | Revolving credit facility | Amended And Restated Credit Agreement | ||||||||
Indebtedness | ||||||||
Aggregate capacity under the credit facility | $ 250,000,000 | $ 355,000,000 | ||||||
Number of extension options | extension_option | 2 | |||||||
Duration of extension option | 6 months | |||||||
Extension fee percentage | 0.075% | |||||||
Increased the capacity of the revolving credit facility | 105,000,000 | |||||||
Credit spread adjustment | 0.10% | |||||||
Line of credit, amount outstanding | $ 200,000,000 | 61,000,000 | ||||||
Interest rate on credit facility as of end of period | 6.82% | |||||||
Interest rate on credit facility as of end of period after giving effect to interest rate caps and swaps | 4.40% | |||||||
Line of Credit | Revolving credit facility | M&T Term Loan Agreement | ||||||||
Indebtedness | ||||||||
Duration of extension option | 1 year | |||||||
Extension fee percentage | 0.075% | |||||||
Credit spread adjustment | 0.10% | |||||||
Line of credit, amount outstanding | $ 100,000,000 | 100,000,000 | ||||||
Interest rate on credit facility as of end of period | 6.72% | |||||||
Interest rate on credit facility as of end of period after giving effect to interest rate caps and swaps | 4.90% | |||||||
Line of Credit | Revolving credit facility | TD Term Loan Facility | ||||||||
Indebtedness | ||||||||
Duration of extension option | 1 year | |||||||
Extension fee percentage | 0.15% | |||||||
Credit spread adjustment | 0.10% | |||||||
Line of credit, amount outstanding | $ 95,000,000 | |||||||
Interest rate on credit facility as of end of period | 6.82% | |||||||
Interest rate on credit facility as of end of period after giving effect to interest rate caps and swaps | 4.70% | |||||||
TD term loan | $ 95,000,000 | |||||||
Line of Credit | Revolving credit facility | Secured Overnight Financing Rate (SOFR) | M&T Term Loan Agreement | ||||||||
Indebtedness | ||||||||
Stated interest rate, basis spread on variable rate | 1% | |||||||
Line of Credit | Revolving credit facility | Secured Overnight Financing Rate (SOFR) | TD Term Loan Facility | ||||||||
Indebtedness | ||||||||
Stated interest rate, basis spread on variable rate | 1% | |||||||
Line of Credit | Revolving credit facility | Federal Funds Rate | M&T Term Loan Agreement | ||||||||
Indebtedness | ||||||||
Stated interest rate, basis spread on variable rate | 0.50% | |||||||
Line of Credit | Revolving credit facility | Federal Funds Rate | TD Term Loan Facility | ||||||||
Indebtedness | ||||||||
Stated interest rate, basis spread on variable rate | 0.50% | |||||||
Line of Credit | Revolving credit facility | Base Rate | TD Term Loan Facility | ||||||||
Indebtedness | ||||||||
Stated interest rate, basis spread on variable rate | 1% | |||||||
Line of Credit | Revolving credit facility | Minimum | Amended And Restated Credit Agreement | ||||||||
Indebtedness | ||||||||
Basis points on unused commitment fee | 0.15% | |||||||
Line of Credit | Revolving credit facility | Minimum | Secured Overnight Financing Rate (SOFR) | Amended And Restated Credit Agreement | ||||||||
Indebtedness | ||||||||
Stated interest rate, basis spread on variable rate | 1.30% | |||||||
Line of Credit | Revolving credit facility | Maximum | Amended And Restated Credit Agreement | ||||||||
Indebtedness | ||||||||
Basis points on unused commitment fee | 0.25% | |||||||
Line of Credit | Revolving credit facility | Maximum | Secured Overnight Financing Rate (SOFR) | Amended And Restated Credit Agreement | ||||||||
Indebtedness | ||||||||
Stated interest rate, basis spread on variable rate | 1.85% | |||||||
Line of Credit | Term Loan Facility | Amended And Restated Credit Agreement | ||||||||
Indebtedness | ||||||||
Aggregate capacity under the credit facility | $ 300,000,000 | $ 655,000,000 | ||||||
Credit spread adjustment | 0.10% | |||||||
Line of credit, amount outstanding | $ 300,000,000 | $ 300,000,000 | ||||||
Interest rate on credit facility as of end of period | 6.72% | |||||||
Interest rate on credit facility as of end of period after giving effect to interest rate caps and swaps | 3.02% | |||||||
Line of Credit | Term Loan Facility | Minimum | Secured Overnight Financing Rate (SOFR) | Amended And Restated Credit Agreement | ||||||||
Indebtedness | ||||||||
Stated interest rate, basis spread on variable rate | 1.25% | |||||||
Line of Credit | Term Loan Facility | Maximum | Secured Overnight Financing Rate (SOFR) | Amended And Restated Credit Agreement | ||||||||
Indebtedness | ||||||||
Stated interest rate, basis spread on variable rate | 1.80% | |||||||
Secured debt | Thames Street Wharf | ||||||||
Indebtedness | ||||||||
Debt instrument, face amount | $ 69,000,000 | |||||||
Secured debt | Constellation Energy Building note receivable | ||||||||
Indebtedness | ||||||||
Debt instrument, face amount | $ 175,000,000 | |||||||
Secured debt | Secured Overnight Financing Rate (SOFR) | Thames Street Wharf | ||||||||
Indebtedness | ||||||||
Stated interest rate, basis spread on variable rate | 1.30% | |||||||
Credit spread adjustment | 0.10% | |||||||
Secured debt | Secured Overnight Financing Rate (SOFR) | Constellation Energy Building note receivable | ||||||||
Indebtedness | ||||||||
Stated interest rate, basis spread on variable rate | 1.50% | |||||||
Credit spread adjustment | 0.11% | |||||||
Construction loans | ||||||||
Indebtedness | ||||||||
Borrowings under construction loans | $ 27,700,000 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Schedule of LIBOR interest rate caps (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 01, 2022 | Jul. 05, 2022 | Nov. 01, 2020 |
Derivative [Line Items] | |||||
Notional Amount | $ 1,475,317 | $ 1,288,349 | |||
Interest rate caps | |||||
Derivative [Line Items] | |||||
Notional Amount | 176,564 | ||||
Premium Paid | $ 1,581 | ||||
Cap rate purchased, interest rate | 1% | ||||
Interest rate caps | Minimum | |||||
Derivative [Line Items] | |||||
Strike Rate | 1% | ||||
Interest rate caps | Maximum | |||||
Derivative [Line Items] | |||||
Strike Rate | 3% | ||||
Interest Rate Cap Two | |||||
Derivative [Line Items] | |||||
Cap rate sold, interest rate | 3% | ||||
Interest rate swaps | |||||
Derivative [Line Items] | |||||
Notional Amount | $ 1,298,753 | ||||
Derivatives designated as accounting hedges | Interest rate caps | |||||
Derivative [Line Items] | |||||
Notional Amount | 176,564 | 561,200 | |||
Derivatives designated as accounting hedges | Interest rate caps | Secured Overnight Financing Rate (SOFR) | |||||
Derivative [Line Items] | |||||
Notional Amount | 73,600 | $ 57,089 | $ 35,100 | $ 84,375 | |
Strike Rate | 1.84% | ||||
Premium Paid | $ 1,370 | $ 120 | $ 91 | ||
Derivatives designated as accounting hedges | Interest rate caps | Secured Overnight Financing Rate (SOFR) | Minimum | |||||
Derivative [Line Items] | |||||
Strike Rate | 1% | 1% | |||
Derivatives designated as accounting hedges | Interest rate caps | Secured Overnight Financing Rate (SOFR) | Maximum | |||||
Derivative [Line Items] | |||||
Strike Rate | 3% | 3% | |||
Derivatives designated as accounting hedges | Interest rate swaps | |||||
Derivative [Line Items] | |||||
Notional Amount | 678,753 | 187,670 | |||
Derivatives not designated as accounting hedges | |||||
Derivative [Line Items] | |||||
Notional Amount | 620,000 | 539,479 | |||
Derivatives not designated as accounting hedges | Interest rate caps | |||||
Derivative [Line Items] | |||||
Notional Amount | 0 | 289,479 | |||
Derivatives not designated as accounting hedges | Interest rate swaps | |||||
Derivative [Line Items] | |||||
Notional Amount | $ 620,000 | $ 250,000 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Floating-to-Fixed Interest Rate Swaps (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Jul. 06, 2023 | Jul. 05, 2023 | Apr. 03, 2023 | Dec. 31, 2022 | Sep. 01, 2022 | Jul. 05, 2022 | Nov. 01, 2020 |
Derivative [Line Items] | ||||||||
Notional Amount | $ 1,475,317 | $ 1,288,349 | ||||||
Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | 1,298,753 | |||||||
Interest rate swaps | Secured Overnight Financing Rate (SOFR) | Minimum | ||||||||
Derivative [Line Items] | ||||||||
Rate corridor, terminated | 1% | 1% | ||||||
Interest rate swaps | Secured Overnight Financing Rate (SOFR) | Maximum | ||||||||
Derivative [Line Items] | ||||||||
Rate corridor, terminated | 3% | 3% | ||||||
Interest rate caps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | 176,564 | |||||||
Interest rate caps | Bloomberg Short Term Bank Yield Index (BSBY) | ||||||||
Derivative [Line Items] | ||||||||
Notional amount, terminated | $ 175,000 | |||||||
Interest rate cap, terminated | 4% | |||||||
Interest rate caps | Bloomberg Short Term Bank Yield Index (BSBY) | Minimum | ||||||||
Derivative [Line Items] | ||||||||
Rate corridor, terminated | 1% | |||||||
Interest rate caps | Bloomberg Short Term Bank Yield Index (BSBY) | Maximum | ||||||||
Derivative [Line Items] | ||||||||
Rate corridor, terminated | 3% | |||||||
Floating rate pool of loans 3.40% | Interest rate swaps | Secured Overnight Financing Rate (SOFR) | ||||||||
Derivative [Line Items] | ||||||||
Notional amount, terminated | $ 50,000 | |||||||
Floating rate pool of loans 3.39% | Interest rate swaps | Secured Overnight Financing Rate (SOFR) | ||||||||
Derivative [Line Items] | ||||||||
Notional amount, terminated | $ 200,000 | |||||||
Derivatives designated as accounting hedges | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | 678,753 | 187,670 | ||||||
Derivatives designated as accounting hedges | Interest rate caps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | 176,564 | 561,200 | ||||||
Derivatives designated as accounting hedges | Interest rate caps | Secured Overnight Financing Rate (SOFR) | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | 73,600 | $ 57,089 | $ 35,100 | $ 84,375 | ||||
Derivatives designated as accounting hedges | Senior unsecured term loan | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 10,500 | |||||||
Swap Fixed Rate | 2.94% | |||||||
Debt effective rate | 4.34% | |||||||
Derivatives designated as accounting hedges | Floating rate pool of loans 3.40% | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 50,000 | |||||||
Swap Fixed Rate | 3.40% | |||||||
Debt effective rate | 4.91% | |||||||
Derivatives designated as accounting hedges | Constellation Energy Building | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 175,000 | |||||||
Swap Fixed Rate | 1.84% | |||||||
Debt effective rate | 3.46% | |||||||
Derivatives designated as accounting hedges | Floating rate pool of loans 3.39% | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 200,000 | |||||||
Swap Fixed Rate | 3.39% | |||||||
Debt effective rate | 4.90% | |||||||
Derivatives designated as accounting hedges | Senior Unsecured Term Loan 0.42% | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 25,000 | |||||||
Swap Fixed Rate | 0.42% | |||||||
Debt effective rate | 1.82% | |||||||
Derivatives designated as accounting hedges | Senior Unsecured Term Loan 0.33% | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 25,000 | |||||||
Swap Fixed Rate | 0.33% | |||||||
Debt effective rate | 1.73% | |||||||
Derivatives designated as accounting hedges | Senior Unsecured Term Loan 0.44% | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 25,000 | |||||||
Swap Fixed Rate | 0.44% | |||||||
Debt effective rate | 1.84% | |||||||
Derivatives designated as accounting hedges | Thames Street Wharf | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 68,253 | |||||||
Swap Fixed Rate | 0.93% | |||||||
Debt effective rate | 2.33% | |||||||
Derivatives designated as accounting hedges | M&T unsecured term loan | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 100,000 | |||||||
Swap Fixed Rate | 3.50% | |||||||
Debt effective rate | 4.90% | |||||||
Derivatives not designated as accounting hedges | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 620,000 | 539,479 | ||||||
Derivatives not designated as accounting hedges | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | 620,000 | 250,000 | ||||||
Derivatives not designated as accounting hedges | Interest rate caps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | 0 | $ 289,479 | ||||||
Derivatives not designated as accounting hedges | Harbor Point Parcel 3 senior construction loan 4.70% | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 90,000 | |||||||
Swap Fixed Rate | 2.75% | |||||||
Debt effective rate | 4.82% | |||||||
Notional amount, terminated | $ 180,400 | |||||||
Amount paid to buy down the swap fixed rate | 3,600 | |||||||
Derivatives not designated as accounting hedges | Floating rate pool of loans 2.75% | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 330,000 | |||||||
Swap Fixed Rate | 2.75% | |||||||
Debt effective rate | 4.26% | |||||||
Amount paid to buy down the swap fixed rate | $ 13,300 | |||||||
Derivatives not designated as accounting hedges | Revolving credit facility and TD unsecured term loan | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 100,000 | |||||||
Swap Fixed Rate | 3.20% | |||||||
Debt effective rate | 4.70% | |||||||
Derivatives not designated as accounting hedges | Senior Unsecured Term Loan 3.43% | Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Notional Amount | $ 100,000 | |||||||
Swap Fixed Rate | 3.43% | |||||||
Debt effective rate | 4.83% |
Derivative Financial Instrume_5
Derivative Financial Instruments - Additional Information (Details) $ in Millions | Sep. 30, 2023 USD ($) |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Gain reclassified during next 12 months | $ 11.6 |
Derivative Financial Instrume_6
Derivative Financial Instruments - Schedule of Derivatives (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Derivative [Line Items] | ||
Notional Amount | $ 1,475,317 | $ 1,288,349 |
Asset, fair value | 39,922 | 29,115 |
Liability, fair value | 0 | 0 |
Interest rate swaps | ||
Derivative [Line Items] | ||
Notional Amount | 1,298,753 | |
Interest rate caps | ||
Derivative [Line Items] | ||
Notional Amount | 176,564 | |
Derivatives not designated as accounting hedges | ||
Derivative [Line Items] | ||
Notional Amount | 620,000 | 539,479 |
Asset, fair value | 22,465 | 4,303 |
Liability, fair value | 0 | 0 |
Derivatives not designated as accounting hedges | Interest rate swaps | ||
Derivative [Line Items] | ||
Notional Amount | 620,000 | 250,000 |
Asset, fair value | 22,465 | 2,201 |
Liability, fair value | 0 | 0 |
Derivatives not designated as accounting hedges | Interest rate caps | ||
Derivative [Line Items] | ||
Notional Amount | 0 | 289,479 |
Asset, fair value | 0 | 2,102 |
Liability, fair value | 0 | 0 |
Derivatives designated as accounting hedges | Interest rate swaps | ||
Derivative [Line Items] | ||
Notional Amount | 678,753 | 187,670 |
Asset, fair value | 15,777 | 11,247 |
Liability, fair value | 0 | 0 |
Derivatives designated as accounting hedges | Interest rate caps | ||
Derivative [Line Items] | ||
Notional Amount | 176,564 | 561,200 |
Asset, fair value | 1,680 | 13,565 |
Liability, fair value | $ 0 | $ 0 |
Derivative Financial Instrume_7
Derivative Financial Instruments - Change in Fair Value of Derivatives (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Derivative [Line Items] | ||||||||
Total change in fair value of interest rate derivatives | $ 4,972 | $ 7,917 | $ 11,842 | $ 26,480 | ||||
Change in fair value of derivatives and other | 1,484 | 809 | 1,974 | 7,700 | ||||
Unrealized cash flow hedge gains | 3,488 | $ 6,806 | $ (426) | 7,108 | $ 3,950 | $ 7,722 | 9,868 | 18,780 |
Interest rate swaps | ||||||||
Derivative [Line Items] | ||||||||
Total change in fair value of interest rate derivatives | 4,952 | 4,330 | 12,188 | 13,894 | ||||
Interest rate caps | ||||||||
Derivative [Line Items] | ||||||||
Total change in fair value of interest rate derivatives | $ 20 | $ 3,587 | $ (346) | $ 12,586 |
Equity - Additional Information
Equity - Additional Information (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |||||||
Nov. 03, 2023 | Oct. 09, 2023 | Oct. 02, 2023 | Jul. 14, 2023 | Apr. 03, 2023 | Mar. 10, 2020 | Sep. 30, 2023 | Dec. 31, 2022 | Jun. 15, 2023 | |
Class of Stock [Line Items] | |||||||||
Percentage of operating partnership held | 75.80% | 76.70% | |||||||
Preferred stock issued | $ 171,085,000 | $ 171,085,000 | |||||||
Stock repurchase program | $ 50,000,000 | ||||||||
Stock repurchase program remaining amount | 49,400,000 | ||||||||
Noncontrolling interests in investment entities | Operating Partnership | |||||||||
Class of Stock [Line Items] | |||||||||
Ownership interest percentage in properties | $ 10,400,000 | $ 24,100,000 | |||||||
Class A units | |||||||||
Class of Stock [Line Items] | |||||||||
Class A units not held by company (in shares) | 21,603,062 | ||||||||
LTIP Units | |||||||||
Class of Stock [Line Items] | |||||||||
Class A units not held by company (in shares) | 39,694 | ||||||||
Subsequent event | |||||||||
Class of Stock [Line Items] | |||||||||
Stock redeemed (in shares) | 50,000 | ||||||||
Common stock | Subsequent event | |||||||||
Class of Stock [Line Items] | |||||||||
Stock repurchased during period, shares (in shares) | 533,699 | ||||||||
Stock repurchase program remaining amount | $ 43,800,000 | ||||||||
The Amendments | Subsequent event | |||||||||
Class of Stock [Line Items] | |||||||||
Maximum aggregate offering price of shares to be sold (up to) | $ 205,000,000 | ||||||||
Redeemable convertible preferred stock | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock dividend rate percentage | 6.75% | 6.75% | |||||||
Redeemable convertible preferred stock | At The Market Program | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock dividend rate percentage | 6.75% | ||||||||
Maximum aggregate offering price of shares to be sold (up to) | $ 300,000,000 | ||||||||
Series A Preferred Stock | |||||||||
Class of Stock [Line Items] | |||||||||
Stock repurchased during period, shares (in shares) | 0 | ||||||||
Common Class A | |||||||||
Class of Stock [Line Items] | |||||||||
Stock redeemed (in shares) | 10,146 | 51,000 | |||||||
Payments for redemption of stock | $ 100,000 | $ 600,000 | |||||||
Stock repurchased during period, shares (in shares) | 62,293 |
Equity - Dividends and Distribu
Equity - Dividends and Distributions (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |||||||||
Sep. 15, 2023 | May 08, 2023 | Feb. 28, 2023 | Nov. 04, 2022 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | |
Class of Stock [Line Items] | ||||||||||
Common stock dividend declared (in dollars per share) | $ 0.195 | $ 0.195 | $ 0.19 | $ 0.19 | $ 0.17 | $ 0.17 | ||||
Aggregate common stock dividends | $ 17,476 | $ 17,470 | $ 16,824 | $ 16,806 | $ 15,034 | $ 14,939 | ||||
Aggregate preferred stock dividends | $ 2,887 | $ 2,887 | $ 2,887 | $ 2,887 | $ 2,887 | $ 2,887 | ||||
Common Stock/Class A Units | ||||||||||
Class of Stock [Line Items] | ||||||||||
Common stock dividend declared (in dollars per share) | $ 0.195 | $ 0.195 | $ 0.190 | $ 0.190 | ||||||
Aggregate common stock dividends | $ 17,476 | $ 17,471 | $ 16,825 | $ 16,785 | ||||||
Series A Preferred Stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Preferred stock dividends declared (in dollars per share) | $ 0.421875 | $ 0.421875 | $ 0.421875 | $ 0.421875 | ||||||
Aggregate preferred stock dividends | $ 2,887 | $ 2,887 | $ 2,887 | $ 2,887 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Jun. 20, 2023 | May 09, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Stock-based compensation expense | $ 0.9 | $ 0.7 | $ 3.3 | $ 3.1 | ||
Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock granted (in shares) | 432,605 | |||||
Restricted stock granted, grant date fair value (in dollars per share) | $ 12.47 | |||||
Restricted stock surrendered, forfeited in period (in shares) | 87,986 | |||||
Employee restricted stock award, vesting period | 2 years | |||||
Nonvested restricted shares outstanding (in shares) | 312,233 | 312,233 | ||||
Unrecognized compensation cost | $ 2.4 | $ 2.4 | ||||
Unrecognized compensation cost, recognition period | 30 months | |||||
Restricted Stock | Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Employee restricted stock award, vesting period | 3 years | |||||
Restricted Stock | Non-Employee Director | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Non-employee restricted stock award vest grant over period | 1 year | |||||
Restricted Stock | Grant Date | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock award, vesting percentage | 33.33% | |||||
Restricted Stock | Grant Date | Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock award, vesting percentage | 40% | |||||
Restricted Stock | Grant Date | Chief Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock award, vesting percentage | 33.33% | |||||
Restricted Stock | Grant Date | Chief Financial Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock award, vesting percentage | 33.33% | |||||
Restricted Stock | First Anniversary | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock award, vesting percentage | 33.33% | |||||
Restricted Stock | First Anniversary | Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock award, vesting percentage | 20% | |||||
Restricted Stock | First Anniversary | Chief Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock award, vesting percentage | 33.33% | |||||
Restricted Stock | First Anniversary | Chief Financial Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock award, vesting percentage | 33.33% | |||||
Restricted Stock | Second Anniversary | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock award, vesting percentage | 33.33% | |||||
Restricted Stock | Second Anniversary | Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock award, vesting percentage | 20% | |||||
Restricted Stock | Second Anniversary | Chief Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock award, vesting percentage | 33.33% | |||||
Restricted Stock | Second Anniversary | Chief Financial Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock award, vesting percentage | 33.33% | |||||
Restricted Stock | Third Anniversary | Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock award, vesting percentage | 20% | |||||
Service Conditions | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock surrendered, forfeited in period (in shares) | 2,800 | |||||
Restricted Stock Units (RSUs) | Chief Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock granted (in shares) | 75,321 | |||||
Restricted stock surrendered, forfeited in period (in shares) | 75,321 | |||||
Restricted Stock Units (RSUs) | Chief Financial Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Restricted stock granted (in shares) | 8,975 | |||||
Restricted stock surrendered, forfeited in period (in shares) | 8,975 | |||||
Amended and Restated 2013 Equity Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Number of shares reserved for issuance (in shares) | 3,400,000 | 3,400,000 | ||||
Shares available for issuance (in shares) | 1,567,039 | 1,567,039 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Carrying Amounts and Fair Values of Financial Instruments Measured based on Level Two Inputs (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value of Financial Instruments | ||
Deferred financing costs | $ 11,300 | $ 11,000 |
Carrying Value | ||
Fair Value of Financial Instruments | ||
Indebtedness, net | 1,333,114 | 1,079,233 |
Notes receivable, net | 83,713 | 136,039 |
Interest rate swap and cap assets | 39,922 | 29,115 |
Fair Value | ||
Fair Value of Financial Instruments | ||
Indebtedness, net | 1,307,552 | 1,058,530 |
Notes receivable, net | 83,713 | 136,039 |
Interest rate swap and cap assets | $ 39,922 | $ 29,115 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Related Party Transactions | |||||
Segment gross profit | $ 48,371,000 | $ 40,846,000 | $ 138,287,000 | $ 121,850,000 | |
Related Party | |||||
Related Party Transactions | |||||
Construction receivables | 0 | 0 | $ 0 | ||
Related Party | Beatty Development Group | |||||
Related Party Transactions | |||||
Segment gross profit | $ 300,000 | $ 200,000 | $ 1,000,000 | $ 400,000 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2023 USD ($) note_receivable | Dec. 31, 2022 USD ($) | Sep. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Commitments and Contingencies | ||||
Line of credit, performance and payment bonds | $ 7,700 | $ 8,500 | ||
Number of notes receivable | note_receivable | 6 | |||
Allowance related to unfunded commitments | $ 857 | $ 338 | $ 354 | $ 10 |
Unfunded loan commitment | ||||
Commitments and Contingencies | ||||
Loans and leases receivable, commitments, variable rates | 52,100 | |||
Harbor Point Parcel 4 | Payment Guarantee | ||||
Commitments and Contingencies | ||||
Outstanding guarantee | 100 | |||
Senior loan | $ 32,900 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Thousands | 1 Months Ended | |||||
Oct. 09, 2023 | Oct. 02, 2023 | Nov. 03, 2023 | Oct. 11, 2023 | Sep. 30, 2023 | Dec. 31, 2022 | |
Subsequent Event [Line Items] | ||||||
Notional amount | $ 1,475,317 | $ 1,288,349 | ||||
Stock repurchase program remaining amount | 49,400 | |||||
Interest rate swap agreement | ||||||
Subsequent Event [Line Items] | ||||||
Notional amount | $ 1,298,753 | |||||
Subsequent events | ||||||
Subsequent Event [Line Items] | ||||||
Stock redeemed (in shares) | 50,000 | |||||
Subsequent events | Common stock | ||||||
Subsequent Event [Line Items] | ||||||
Stock repurchased during period, shares (in shares) | 533,699 | |||||
Stock repurchased during the period, value | $ 5,500 | |||||
Stock repurchase program remaining amount | $ 43,800 | |||||
Subsequent events | Interest rate swap agreement | ||||||
Subsequent Event [Line Items] | ||||||
Notional amount | $ 100,000 | |||||
Premium paid | $ 3,900 | |||||
Subsequent events | Interest rate swap agreement | SOFR | ||||||
Subsequent Event [Line Items] | ||||||
Interest rate | 2.75% | |||||
Revolving credit facility | Subsequent events | ||||||
Subsequent Event [Line Items] | ||||||
Proceeds from lines of credit | $ 49,000 |