Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 17, 2017 | Jun. 30, 2016 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | Brookfield DTLA Fund Office Trust Investor Inc. | ||
Entity Central Index Key | 1,575,311 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 0 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 0 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Investments in Real Estate: | ||
Land | $ 227,555 | $ 227,555 |
Buildings and improvements | 2,191,676 | 2,167,746 |
Tenant improvements | 321,542 | 279,948 |
Investments in real estate, cost | 2,740,773 | 2,675,249 |
Less: accumulated depreciation | 329,149 | 256,130 |
Investments in real estate, net | 2,411,624 | 2,419,119 |
Cash and cash equivalents | 30,301 | 53,736 |
Restricted cash | 60,084 | 53,830 |
Rents, deferred rents and other receivables, net | 118,211 | 95,690 |
Intangible assets, net | 75,586 | 99,710 |
Deferred charges, net | 64,967 | 66,791 |
Prepaid and other assets | 9,186 | 9,134 |
Total assets | 2,769,959 | 2,798,010 |
Liabilities: | ||
Mortgage loans, net | 2,076,804 | 2,111,405 |
Accounts payable and other liabilities | 85,504 | 105,004 |
Due to affiliates, net | 14,327 | 9,335 |
Intangible liabilities, net | 22,227 | 30,208 |
Total liabilities | 2,198,862 | 2,255,952 |
Commitments and Contingencies | ||
Mezzanine Equity: | ||
Mezzanine equity | 829,532 | 726,595 |
Total mezzanine equity | 829,532 | 726,595 |
Stockholders’ Deficit: | ||
Common stock, $0.01 par value, 1,000 shares issued and outstanding as of December 31, 2016 and 2015 | 0 | 0 |
Additional paid-in capital | 194,210 | 191,710 |
Accumulated deficit | (215,264) | (177,879) |
Accumulated other comprehensive loss | (1,607) | (2,580) |
Noncontrolling interest – Series B common interest | (235,774) | (195,788) |
Total stockholders’ deficit | (258,435) | (184,537) |
Total liabilities and deficit | 2,769,959 | 2,798,010 |
Series A Preferred Stock | ||
Mezzanine Equity: | ||
Mezzanine equity | 372,852 | 354,304 |
Series A-1 preferred interest | ||
Mezzanine Equity: | ||
Mezzanine equity | 366,297 | 349,084 |
Senior participating preferred interest | ||
Mezzanine Equity: | ||
Mezzanine equity | 25,019 | 23,207 |
Series B preferred interest | ||
Mezzanine Equity: | ||
Mezzanine equity | $ 65,364 | $ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares issued (in shares) | 1,000 | 1,000 |
Common stock, shares outstanding (in shares) | 1,000 | 1,000 |
Series A Preferred Stock | ||
Preferred stock feature | 7.625% Series A Cumulative Redeemable Preferred Stock | 7.625% Series A Cumulative Redeemable Preferred Stock |
Preferred stock, dividend rate, percentage | 7.625% | 7.625% |
Preferred stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares issued (in shares) | 9,730,370 | 9,730,370 |
Preferred stock, shares outstanding (in shares) | 9,730,370 | 9,730,370 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue: | |||
Rental income | $ 164,816 | $ 160,662 | $ 152,372 |
Tenant reimbursements | 95,578 | 88,615 | 95,931 |
Parking | 36,614 | 34,439 | 33,774 |
Interest and other | 13,684 | 15,374 | 12,084 |
Total revenue | 310,692 | 299,090 | 294,161 |
Expenses: | |||
Rental property operating and maintenance | 99,074 | 96,757 | 100,264 |
Real estate taxes | 37,401 | 35,675 | 38,340 |
Parking | 8,430 | 8,080 | 7,411 |
Other expense | 4,909 | 5,357 | 3,325 |
Depreciation and amortization | 103,970 | 98,160 | 105,058 |
Interest | 95,075 | 95,415 | 92,755 |
Total expenses | 348,859 | 339,444 | 347,153 |
Net loss | (38,167) | (40,354) | (52,992) |
Series B common interest – allocation of net loss | (41,055) | (44,521) | (52,891) |
Net loss attributable to Brookfield DTLA | (18,837) | (21,992) | (29,614) |
Net loss available to common interest holders of Brookfield DTLA | (37,385) | (40,540) | (48,162) |
Series A-1 preferred interest | |||
Expenses: | |||
Current dividends | 17,213 | 17,213 | 17,213 |
Senior participating preferred interest | |||
Expenses: | |||
Current dividends | 0 | 2,321 | 10,044 |
Redemption measurement adjustment | 2,428 | 6,625 | 2,256 |
Series B preferred interest | |||
Expenses: | |||
Current dividends | 2,084 | 0 | 0 |
Series A preferred stock | |||
Expenses: | |||
Current dividends | $ 18,548 | $ 18,548 | $ 18,548 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (38,167) | $ (40,354) | $ (52,992) |
Derivative transactions: | |||
Derivative holding gains (losses) | 2,042 | (1,078) | (5,344) |
Comprehensive loss | (36,125) | (41,432) | (58,336) |
Less: comprehensive loss attributable to noncontrolling interests | (18,261) | (18,926) | (26,176) |
Comprehensive loss available to common interest holders of Brookfield DTLA | $ (17,864) | $ (22,506) | $ (32,160) |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Non-controlling Interest |
Balance at beginning of year (in shares) at Dec. 31, 2013 | 1,000 | |||||
Balance at beginning of year at Dec. 31, 2013 | $ 7,999 | $ 0 | $ 191,710 | $ (89,177) | $ 480 | $ (95,014) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (52,992) | (29,614) | (23,378) | |||
Other comprehensive (loss) income | (5,344) | (2,546) | (2,798) | |||
Dividends on Series A preferred stock, Series A-1 preferred interest, senior participating preferred interest and Series B preferred interest | (48,061) | (18,548) | (29,513) | |||
Balance at end of year (in shares) at Dec. 31, 2014 | 1,000 | |||||
Balance at end of year at Dec. 31, 2014 | (98,398) | $ 0 | 191,710 | (137,339) | (2,066) | (150,703) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (40,354) | (21,992) | (18,362) | |||
Other comprehensive (loss) income | (1,078) | (514) | (564) | |||
Dividends on Series A preferred stock, Series A-1 preferred interest, senior participating preferred interest and Series B preferred interest | (44,707) | (18,548) | (26,159) | |||
Balance at end of year (in shares) at Dec. 31, 2015 | 1,000 | |||||
Balance at end of year at Dec. 31, 2015 | (184,537) | $ 0 | 191,710 | (177,879) | (2,580) | (195,788) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (38,167) | (18,837) | (19,330) | |||
Other comprehensive (loss) income | 2,042 | 973 | 1,069 | |||
Contribution from Brookfield DTLA Holdings | 2,500 | 2,500 | ||||
Dividends on Series A preferred stock, Series A-1 preferred interest, senior participating preferred interest and Series B preferred interest | (40,273) | (18,548) | (21,725) | |||
Balance at end of year (in shares) at Dec. 31, 2016 | 1,000 | |||||
Balance at end of year at Dec. 31, 2016 | $ (258,435) | $ 0 | $ 194,210 | $ (215,264) | $ (1,607) | $ (235,774) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Cash flows from operating activities: | |||
Net loss | $ (38,167) | $ (40,354) | $ (52,992) |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Gain on sale of land held for investment | 0 | (28) | 0 |
Depreciation and amortization | 103,970 | 98,160 | 105,058 |
(Recovery of) provision for doubtful accounts | (271) | 103 | 24 |
Amortization of below-market leases/ above-market leases | (3,465) | (2,559) | (3,059) |
Straight-line rent amortization | (16,798) | (21,598) | (15,849) |
Amortization of tenant inducements | 3,399 | 2,647 | 1,209 |
Amortization of discounts and deferred financing costs | 4,329 | 5,064 | 6,049 |
Changes in assets and liabilities: | |||
Rents, deferred rents and other receivables | (9,122) | (2,479) | (6,409) |
Due to (from) affiliates, net | 4,991 | 6,586 | (13,712) |
Deferred charges | (9,516) | (17,056) | (12,832) |
Prepaid and other assets | (53) | 2,382 | 6,787 |
Accounts payable and other liabilities | (3,469) | (877) | 8,688 |
Net cash provided by operating activities | 35,828 | 29,991 | 22,962 |
Cash flows from investing activities: | |||
Proceeds from sale of land held for investment | 0 | 2,028 | 0 |
Expenditures for improvements to real estate | (57,350) | (60,089) | (43,729) |
Increase in restricted cash | (6,254) | (6,712) | (24,321) |
Net cash used in investing activities | (63,604) | (64,773) | (68,050) |
Cash flows from financing activities: | |||
Proceeds from mortgage loans | 720,000 | 0 | 435,000 |
Principal payments on mortgage loans | (751,518) | (623) | (214,512) |
Dividends paid on Series A preferred stock | (21,893) | 0 | 0 |
Distributions to senior participating preferred interest | (616) | (32,769) | (207,231) |
Dividends paid to senior participating preferred interest | 0 | (3,051) | (12,769) |
Contributions from Series B preferred interest | 63,280 | 0 | 0 |
Contribution from Brookfield DTLA Holdings | 2,500 | 0 | 0 |
Due to affiliates | 0 | 0 | (25,000) |
Financing fees paid | (7,412) | (43) | (1,467) |
Net cash provided by (used in) financing activities | 4,341 | (36,486) | (25,979) |
Net change in cash and cash equivalents | (23,435) | (71,268) | (71,067) |
Cash and cash equivalents at beginning of year | 53,736 | 125,004 | 196,071 |
Cash and cash equivalents at end of year | 30,301 | 53,736 | 125,004 |
Supplemental disclosure of cash flow information: | |||
Cash paid for interest | 89,630 | 90,093 | 86,990 |
Supplemental disclosure of non-cash activities: | |||
Accrual for real estate improvements | 24,465 | 16,290 | 18,588 |
Accrual for deferred leasing costs | 2,349 | 4,956 | 2,585 |
Dividends declared but not yet paid | 0 | 21,893 | 0 |
Increase (decrease) in fair value of interest rate swap, net | $ 2,042 | $ (1,078) | $ (5,344) |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | Organization and Description of Business Brookfield DTLA Fund Office Trust Investor Inc. (“Brookfield DTLA” or the “Company”) is a Maryland corporation and was incorporated on April 19, 2013. Brookfield DTLA was formed for the purpose of consummating the transactions contemplated in the Agreement and Plan of Merger dated as of April 24, 2013, as amended (the “Merger Agreement”), and the issuance of shares of 7.625% Series A Cumulative Redeemable Preferred Stock (the “Series A preferred stock”) in connection with the acquisition of MPG Office Trust, Inc. and MPG Office, L.P. (together, “MPG”). Brookfield DTLA is a direct subsidiary of Brookfield DTLA Holdings LLC (“Brookfield DTLA Holdings”), a Delaware limited liability company and an indirect partially-owned subsidiary of Brookfield Office Properties Inc., a corporation incorporated under the Laws of Canada (“BPO”). Brookfield DTLA owns BOA Plaza, EY Plaza, Wells Fargo Center–North Tower, Wells Fargo Center–South Tower, Gas Company Tower and 777 Tower, each of which is a Class A office property located in the Los Angeles Central Business District (the “LACBD”). Brookfield DTLA receives its income primarily from rental income (including tenant reimbursements) generated from the operations of its office and retail properties, and to a lesser extent, from its parking garages. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies Principles of Consolidation and Basis of Presentation As used in these consolidated financial statements and related notes, unless the context requires otherwise, the terms “Brookfield DTLA,” the “Company,” “us,” “we” and “our” refer to Brookfield DTLA Fund Office Trust Investor Inc. The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated balance sheets as of December 31, 2016 and 2015 include the accounts of Brookfield DTLA and subsidiaries in which it has a controlling financial interest. All intercompany transactions have been eliminated in consolidation as of and for the years ended December 31, 2016 , 2015 and 2014 . In determining whether Brookfield DTLA has a controlling financial interest in an entity and the requirement to consolidate the accounts of that entity, management considers factors such as ownership interest, board representation, management representation, authority to make decisions, and contractual and substantive participating rights of the partners/members as well as whether the entity is a variable interest entity (“VIE”) and Brookfield DTLA is the primary beneficiary. A VIE is broadly defined as an entity where either (i) the equity investors as a group, if any, lack the power through voting or similar rights to direct the activities of an entity that most significantly impact the entity’s economic performance or (ii) the equity investment at risk is insufficient to finance that entity’s activities without additional subordinated financial support. A variable interest holder is considered to be the primary beneficiary of a VIE if it has the power to direct the activities of a variable interest entity that most significantly impact the entity’s economic performance and has the obligation to absorb losses of, or the right to receive benefits from, the entity that could potentially be significant to the VIE. Brookfield DTLA qualitatively assesses whether it is (or is not) the primary beneficiary of a VIE. Consideration of various factors includes, but is not limited to, Brookfield DTLA’s ability to direct the activities that most significantly impact the VIE’s economic performance, its form of ownership interest, its representation on the VIE’s governing body, the size and seniority of its investment, its ability and the rights of other investors to participate in policy making decisions and its ability to replace the manager of and/or liquidate the entity. The Company earns a return through an indirect investment in Brookfield DTLA Fund Properties II LLC (“New OP”). Brookfield DTLA Holdings, the parent of Brookfield DTLA, owns all of the common interest in New OP. Brookfield DTLA has an indirect preferred stock interest in New OP and its wholly owned subsidiary is the managing member of New OP. The Company determined that New OP is a VIE and as a result of having the power to direct the significant activities of New OP and exposure to the economic performance of New OP, Brookfield DTLA meets the two conditions for being the primary beneficiary. Brookfield DTLA is required to continually evaluate its VIE relationships and consolidation conclusion. Reclassifications We had reported $220,000 of distributions to Brookfield DTLA Holdings in the consolidated statement of cash flows for the year ended December 31, 2014 . We have reclassified this total to show $207,231 as distributions to senior participating preferred interest and $12,769 as dividends paid to senior participating preferred interest so as to conform to the 2016 and 2015 presentation. In December 2015, Brookfield DTLA adopted the guidance in Accounting Standards Update (“ASU”) 2015-03, Simplifying the Presentation of Debt Issuance Costs , which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability. We have combined the amortization of deferred financing costs ( $1,007 ) and the amortization of debt discounts ( $5,042 ) for the year ended December 31, 2014 and presented a new total ( $6,049 ) in the consolidated statement of cash flows so as to reflect the presentation of such costs in the consolidated balance sheet. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. For example, estimates and assumptions have been made with respect to fair values of assets and liabilities for purposes of applying the acquisition method of accounting, the useful lives of assets, recoverable amounts of receivables, impairment of long‑lived assets and fair value of debt. Actual results could ultimately differ from such estimates. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (the “FASB”) issued ASU 2014-09 establishing Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. ASU 2014-09 establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. ASU 2014-09 requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration that the entity expects to be entitled to receive in exchange for those goods or services and also requires certain additional disclosures. ASU 2014-09 is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2017. We are currently evaluating the impact of the adoption of ASU 2014-09 on Brookfield DTLA’s consolidated financial statements. In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. This topic provides guidance on management’s responsibility to evaluate whether there is substantial doubt about a company’s ability to continue as a going concern and requires related footnote disclosures. The guidance in ASU 2014-15 became effective for Brookfield DTLA for year-end December 31, 2016. The implementation of this pronouncement did not have a material impact on Brookfield DTLA’s consolidated financial statements. In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis to ASC Topic 810 , Consolidation . ASU 2015-02 affects reporting entities that are required to evaluate whether they should consolidate certain legal entities. Specifically, the amendments: (i) modify the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities, (ii) eliminate the presumption that a general partner should consolidate a limited partnership, (iii) affect the consolidated analysis of reporting entities that are involved with VIEs, and (iv) provide a scope exception for certain entities. The guidance in ASU 2015-02 became effective for Brookfield DTLA beginning January 1, 2016. The implementation of this pronouncement did not have a material impact on Brookfield DTLA’s consolidated financial statements. In April 2015, the FASB issued ASU 2015-03 that requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts, as opposed to being presented as assets. Brookfield DTLA elected to early adopt ASU 2015-03 effective as of December 31, 2015. There was no effect on Brookfield DTLA’s consolidated statement of operations for the year ended December 31, 2014 as a result of adopting this pronouncement. In February 2016, the FASB issued ASU 2016-02 establishing ASC Topic 842, Leases . The guidance in this update supersedes the guidance in ASC Topic 840, Leases . ASU 2016-02 revises GAAP related to accounting for leases by lessees. Under this new guidance, lessees will be required to recognize a lease liability and a right-of-use asset in the balance sheet for all leases with terms greater than 12 months. Leases will be classified as either finance or operating, with classification determining the pattern of expense recognition in the statement of operations. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and should be applied using a modified retrospective approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Early adoption is permitted. We are currently evaluating the impact of the adoption of ASU 2016-02 on Brookfield DTLA’s consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments to ASC Topic 230, Statement of Cash Flows . ASU 2016-15 clarifies guidance on the classification of certain cash receipts and payments in the statement of cash flows to reduce diversity in practice with respect to (i) debt prepayment or debt extinguishment costs, (ii) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing, (iii) contingent consideration payments made after a business combination, (iv) proceeds from the settlement of insurance claims, (v) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies, (vi) distributions received from equity method investees, (vii) beneficial interests in securitization transactions, and (viii) separately identifiable cash flows and application of the predominance principle. ASU 2016-15 is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2017, with early adoption permitted. We do not expect the adoption of this update to have a material impact on Brookfield DTLA’s consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, Restricted Cash to ASC Topic 230, Statement of Cash Flows . ASU 2016-18 requires entities to show the changes in the total of cash, cash equivalents, restricted cash, and restricted cash equivalents in the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. ASU 2016-18 is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption permitted, including adoption in an interim period. Upon adoption, we will retrospectively reconcile the activity in our cash, cash equivalents, restricted cash and restricted cash equivalents during reporting periods. In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business to ASC Topic 805, Business Combinations. ASU 2017-01 introduced amendments that are intended to make the guidance on the definition of a business more consistent and cost-efficient. The objective of the update is to add further guidance that assists entities in evaluating whether a transaction should be accounted for as an acquisition (or disposal) of assets or a business by providing a screen to determine when a set of assets and activities acquired is not a business. ASU 2017-01 is effective for annual periods beginning after December 15, 2017 including interim periods within those periods. ASU 2017-01 must be applied prospectively on or after the effective date. We are currently evaluating the impact of the adoption of ASU 2017-01 on Brookfield DTLA’s consolidated financial statements. Significant Accounting Policies Business Combinations— Purchase accounting is applied to the assets and liabilities related to all real estate investments acquired from third parties. In accordance with FASB ASC Topic 805, Business Combinations , the purchase price of real estate acquired is allocated to acquired tangible assets, consisting primarily of land, building and tenant improvements, and identifiable intangible assets and liabilities, consisting of the value of above- and below-market leases, in-place leases, and tenant relationships, based in each case on their fair value. The principal valuation technique employed by Brookfield DTLA in determining the fair value of identified assets acquired and liabilities assumed is the income approach, which is then compared to the cost approach. Tangible values for investments in real estate are calculated based on replacement costs for like type quality assets. Above- and below-market lease values are determined by comparing in-place rents with current market rents. In‑place lease amounts are determined by calculating the potential lost revenue during the replacement of the current leases in place. Leasing commissions and legal/marketing fees are determined based upon market allowances pro-rated over the remaining lease terms. Mortgage loans assumed in an acquisition are analyzed using current market terms for similar debt. The value of the acquired above-market and below-market leases are amortized and recorded as either a decrease (in the case of above-market leases) or an increase (in the case of below-market leases) to rental income in the consolidated statement of operations over the remaining term of the associated lease. The value of tenant relationships is amortized over the expected term of the relationship, which includes an estimated probability of lease renewal. The value of in-place leases is amortized as an expense over the remaining life of the leases. Amortization of tenant relationships and in‑place leases is included in depreciation and amortization in the consolidated statement of operations. Investments in Real Estate— Land is carried at cost. Buildings are recorded at historical cost and are depreciated on a straight-line basis over the estimated useful life of the building, which is 60 years with an estimated salvage value of 5% . Building improvements are recorded at historical cost and are depreciated on a straight-line basis over their estimated useful lives, which range from 7 years to 25 years. Tenant improvements that are determined to be assets of Brookfield DTLA are recorded at cost; amortization is included in depreciation and amortization expense in the consolidated statement of operations on a straight-line basis over the shorter of the useful life or the applicable lease term. Depreciation expense related to investments in real estate during the years ended December 31, 2016 , 2015 and 2014 was $73.0 million , $67.0 million and $67.5 million , respectively. Real estate is reviewed for impairment if events or changes in circumstances indicate that the carrying amount of the real estate may not be recoverable. In such an event, a comparison is made of the current and projected operating cash flows of the property into the foreseeable future on an undiscounted basis to the carrying amount of the real estate. If the undiscounted cash flows expected to be generated by an asset are less than its carrying amount, an impairment provision would be recorded to write down the carrying amount of such asset to its fair value. Brookfield DTLA assesses fair value based on estimated cash flow projections utilizing appropriate discount and capitalization rates and available market information. Projections of future cash flow take into account the specific business plan for the property and management’s best estimate of the most probable set of economic conditions expected to prevail in the market. Management believes no impairment of Brookfield DTLA’s real estate assets existed at December 31, 2016 and 2015 . Cash and Cash Equivalents— Cash and cash equivalents include all cash and short-term investments with an original maturity of three months or less. Restricted Cash— Restricted cash consists primarily of deposits for tenant improvements and leasing commissions, real estate taxes and insurance reserves, debt service reserves and other items as required by our mortgage loan agreements. Rents, Deferred Rents and Other Receivables, Net— Differences between rental income and the contractual amounts due are recorded as deferred rents receivable in the consolidated balance sheet. Brookfield DTLA evaluates its deferred rents receivable to consider if an allowance is necessary. Rents, deferred rents and other receivables, net also includes any amounts paid to a tenant for improvements owned or costs incurred by the tenant are treated as tenant inducements and are presented in the consolidated balance sheet net of accumulated amortization totaling $9.9 million and $6.5 million as of December 31, 2016 and 2015 , respectively. Amortization of tenant inducements is recorded on a straight-line basis over the term of the related lease as a reduction of rental income in the consolidated statement of operations. Brookfield DTLA periodically evaluates the collectability of amounts due from tenants and maintains an allowance for doubtful accounts in the consolidated balance sheet for estimated losses resulting from the inability of tenants to make required payments under the lease agreements. Management exercises judgment in establishing these allowances and considers payment history and current credit status in developing these estimates. The allowance for doubtful accounts for Brookfield DTLA totaled $0.2 million and $0.5 million as of December 31, 2016 and 2015 , respectively. For the year ended December 31, 2016 , Brookfield DTLA recorded a $271 thousand recovery of doubtful accounts. For the years ended December 31, 2015 and 2014 , Brookfield DTLA recorded provisions for doubtful accounts of $103 thousand and $24 thousand , respectively. Due to/from Affiliates, Net— Amounts due to/from affiliates, net consist of related party receivables and payables from affiliates of BPO primarily for fees for property management and other services. These amounts are due on demand and are non‑interest bearing. Deferred Charges, Net— Leasing costs are deferred and are presented as deferred charges in the consolidated balance sheet net of accumulated amortization totaling $49.6 million and $38.2 million as of December 31, 2016 and 2015 , respectively. Deferred leasing costs are amortized on a straight-line basis over the terms of the related leases as part of depreciation and amortization in the consolidated statement of operations. Prepaid and Other Assets, Net— Prepaid and other assets include prepaid insurance, prepaid real estate taxes and other operating costs. Mortgage Loans, Net— Mortgage loans are presented in the consolidated balance sheet net of unamortized discounts and debt issuance costs totaling $9.1 million and $6.0 million as of December 31, 2016 and 2015 , respectively. Discounts and debt issuance costs totaling $4.3 million , $5.1 million and $6.0 million were amortized during the years ended December 31, 2016 , 2015 and 2014 , respectively, over the terms of the related mortgage loans on a basis that approximates the effective interest method and are included as part of interest expense in the consolidated statement of operations. Revenue Recognition— Rental income from leases providing for periodic increases in base rent is recognized on a straight-line basis over the noncancelable term of the respective leases. Certain leases with retail tenants also provide for the payment by the lessee of additional rent based on a percentage of the tenants’ sales. Percentage rents are recognized only after the tenant sales thresholds have been achieved. Recoveries of operating expenses and real estate taxes are recorded as tenant reimbursements in the consolidated statement of operations in the period during which the expenses are incurred. Income Taxes— Brookfield DTLA has elected to be taxed as a real estate investment trust (“REIT”) pursuant to Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), commencing with its tax period ended December 31, 2013. Brookfield DTLA conducts and intends to conduct its operations so as to continue to qualify as a REIT. Accordingly, Brookfield DTLA is not subject to U.S. federal income tax, provided that it continues to qualify as a REIT and distributions to its stockholders, if any, generally equal or exceed its taxable income. Brookfield DTLA has elected to treat certain of its subsidiaries as taxable REIT subsidiaries (“TRS”). Certain activities that we undertake must be conducted by a TRS, such as non-customary services for our tenants, and holding assets that we cannot hold directly. A TRS is subject to both federal and state income taxes. Qualification and taxation as a REIT depends upon Brookfield DTLA’s ability to meet the various qualification tests imposed under the Code related to annual operating results, asset diversification, distribution levels and diversity of stock ownership. Accordingly, no assurance can be given that Brookfield DTLA will be organized or be able to operate in a manner so as to continue to qualify as a REIT. If Brookfield DTLA fails to qualify as a REIT in any taxable year, it will be subject to federal and state income tax on its taxable income at regular corporate tax rates, and it may be ineligible to qualify as a REIT for four subsequent tax years. Brookfield DTLA may also be subject to certain state or local income taxes, or franchise taxes on its REIT activities. Brookfield DTLA made no provision for income taxes in its consolidated financial statements for the years ended December 31, 2016 , 2015 and 2014 . Brookfield DTLA’s taxable income or loss is different than its financial statement income or loss. Brookfield DTLA recognizes tax benefits from uncertain tax positions when it is more likely than not that the position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits. Income tax positions must meet a more likely than not recognition threshold. Brookfield DTLA had no unrecognized tax benefits of December 31, 2016 and 2015 , and Brookfield DTLA does not expect its unrecognized tax benefits balance to change during the next 12 months. As of December 31, 2016 , Brookfield DTLA’s 2013 tax period and 2014 and 2015 tax years remain open due to the statute of limitations and may be subject to examination by federal, state and local authorities. The 2012 tax year as well as the short tax period ended October 15, 2013 for Brookfield DTLA and its subsidiaries remain open due to the statute of limitations and may be subject to examination by federal, state and local tax authorities. Derivative Financial Instruments— Brookfield DTLA uses interest rate swap and cap contracts to manage risk from fluctuations in interest rates as well as to hedge anticipated future financing transactions. Interest rate swaps involve the receipt of variable-rate amounts in exchange for fixed-rate payments over the life of the agreements without exchange of the underlying principal amount. Interest rate caps involve the receipt of variable-rate amounts beyond a specified strike price over the life of the agreements without exchange of the underlying principal amount. The Company believes these agreements are with counterparties who are creditworthy financial institutions. Brookfield DTLA adheres to the provisions of ASC Subtopic 815-10-15, Derivatives and Hedging (“ASC 815-10-15”). ASC 815-10-15 establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and for hedging activities. It requires the recognition of all derivative instruments as assets or liabilities in the Company’s consolidated balance sheet at fair value. Changes in the fair value of derivative instruments that are not designated as hedges, or that do not meet the hedge accounting criteria in ASC 815-10-15, are required to be reported through the statement of operations. Brookfield DTLA has elected to designate its interest rate swap as a cash flow hedge. Segment Reporting Brookfield DTLA operates in a single reportable segment referred to as its office segment, which includes the operation and management of commercial office properties. Each of Brookfield DTLA’s operating properties is considered a separate operating segment, as each property earns revenues and incurs expenses, individual operating results are reviewed and discrete financial information is available. Management does not distinguish or group Brookfield DTLA’s consolidated operations based on geography, size or type. Brookfield DTLA’s operating properties have similar economic characteristics and provide similar products and services to tenants. As a result, Brookfield DTLA’s operating properties are aggregated into a single reportable segment. Accounting for Conditional Asset Retirement Obligations Brookfield DTLA has evaluated whether it has any conditional asset retirement obligations, which are a legal obligation to perform an asset retirement activity in which the timing and/or method of settlement are conditional upon future events that may or may not be within an entity’s control. The obligation to perform the asset retirement activity is unconditional even though uncertainty exists about the timing and/or method of settlement. Accordingly, Brookfield DTLA recognized a liability for a conditional asset retirement obligation. |
Intangible Assets and Liabiliti
Intangible Assets and Liabilities | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Liabilities | Intangible Assets and Liabilities Brookfield DTLA’s intangible assets and liabilities are summarized as follows (in thousands): December 31, 2016 December 31, 2015 Intangible Assets In-place leases $ 110,519 $ 110,519 Tenant relationships 46,248 46,248 Above-market leases 39,936 39,936 196,703 196,703 Less: accumulated amortization 121,117 96,993 Intangible assets, net $ 75,586 $ 99,710 Intangible Liabilities Below-market leases $ 76,344 $ 76,344 Less: accumulated amortization 54,117 46,136 Intangible liabilities, net $ 22,227 $ 30,208 The impact of the amortization of acquired below-market leases, net of acquired above-market leases, on rental income and of acquired in-place leases and tenant relationships on depreciation and amortization expense is as follows (in thousands): For the Year Ended December 31, 2016 2015 2014 Rental income $ 3,465 $ 2,559 $ 3,059 Depreciation and amortization expense 19,609 21,159 26,872 As of December 31, 2016 , the estimate of the amortization/accretion of intangible assets and liabilities during the next five years and thereafter is as follows (in thousands): In-Place Leases Other Intangible Assets Intangible Liabilities 2017 $ 10,477 $ 6,324 $ 5,656 2018 6,754 5,146 3,812 2019 5,704 4,313 3,238 2020 5,059 3,417 3,031 2021 4,821 3,381 2,906 Thereafter 9,619 10,571 3,584 $ 42,434 $ 33,152 $ 22,227 |
Mortgage Loans
Mortgage Loans | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Mortgage Loans | Mortgage Loans Brookfield DTLA’s debt is as follows (in thousands, except percentage amounts): Contractual Maturity Date Principal Amount as of Interest Rate December 31, 2016 December 31, 2015 Floating-Rate Debt Variable-Rate Loans: Wells Fargo Center–South Tower (1) 12/6/2018 4.34 % $ 250,000 $ — 777 Tower (2) 11/1/2018 2.80 % 220,000 200,000 Figueroa at 7th (3) 9/10/2017 2.91 % 35,000 35,000 Total variable-rate loans 505,000 235,000 Variable-Rate Swapped to Fixed-Rate Loan: EY Plaza (4) 11/27/2020 3.93 % 180,859 184,377 Total floating-rate debt 685,859 419,377 Fixed-Rate Debt: Wells Fargo Center–North Tower 4/6/2017 5.70 % 550,000 550,000 BOA Plaza 9/1/2024 4.05 % 400,000 400,000 Gas Company Tower 8/6/2021 3.47 % 319,000 — Gas Company Tower 8/6/2021 6.50 % 131,000 — Total fixed-rate debt 1,400,000 950,000 Debt Refinanced: Gas Company Tower — 458,000 Wells Fargo Center–South Tower — 290,000 Total debt refinanced — 748,000 Total debt 2,085,859 2,117,377 Less: unamortized discounts and debt issuance costs 9,055 5,972 Total debt, net $ 2,076,804 $ 2,111,405 __________ (1) This loan bears interest at LIBOR plus 3.69% . As required by the loan agreement, we have entered into an interest rate cap agreement that limits the LIBOR portion of the interest rate to 3.00% . Brookfield DTLA has three options to extend the maturity date of the loan, each for a period of one year, subject to meeting certain debt yield and loan to value ratios (as specified in the loan agreement). (2) This loan bears interest at LIBOR plus 2.18% . As required by the loan agreement, we have entered into an interest rate cap agreement that limits the LIBOR portion of the interest rate to 5.75% . Brookfield DTLA has two options to extend the maturity date of the loan, each for a period of one year, subject to meeting certain debt yield and loan to value ratios (as specified in the loan agreement). (3) This loan bears interest at LIBOR plus 2.25% . Brookfield DTLA has two options to extend the maturity date of this loan, each for a period of 12 months, subject to meeting certain debt yield and loan to value ratios (as specified in the loan agreement). (4) This loan bears interest at LIBOR plus 1.75% . As required by the loan agreement, we have entered into an interest rate swap agreement to hedge this loan, which effectively fixes the LIBOR portion of the interest rate at 2.178% . The effective interest rate of 3.93% includes interest on the swap. The weighted average interest rate of our debt was 4.42% as of December 31, 2016 and 4.20% as of December 31, 2015 . Debt Refinanced Gas Company Tower— On July 11, 2016 , Brookfield DTLA refinanced the $458.0 million mortgage loan secured by Gas Company Tower. In connection with the refinancing, the Company repaid $8.0 million of principal and was required to fund various loan reserves, including a $20.7 million tenant improvement and leasing commission reserve, a $4.5 million rent concession reserve, and a $3.0 million property tax reserve at closing. During July 2016, the Company received $37.0 million in cash contributions from Brookfield DTLA Holdings, of which $19.7 million was used to pay for costs associated with the refinancing of Gas Company Tower. The new $450.0 million mortgage loan is comprised of a $319.0 million senior loan and a $131.0 million mezzanine loan, which bear interest at fixed rates equal to 3.4727% and 6.50% , respectively, mature on August 6, 2021 , and require the payment of interest-only until maturity. The senior loan is locked out from prepayment until September 6, 2017 , after which it can be prepaid, in whole or in part, with prepayment penalties (as defined in the underlying loan agreement) until April 6, 2021 after which the loan can be repaid without penalty. The mezzanine loan is locked out from prepayment until September 6, 2017 , after which the loan can be repaid, in whole or in part, without penalty. Wells Fargo Center–South Tower— On December 2, 2016 , Brookfield DLTA refinanced the $290.0 million mortgage loan secured by Wells Fargo Center–South Tower. In connection with the refinancing, the Company repaid $40.0 million of principal and was required to fund various loan reserves, including a $6.1 million tenant improvement and leasing commission reserve and a $1.1 million property tax reserve at closing. During November 2016, the Company received $20.3 million in cash contributions from Brookfield DTLA Holdings that, along with cash on hand, was used to pay for costs associated with the refinancing of Wells Fargo Center–South Tower. The new $270.0 million mortgage loan is comprised of an initial advance amount of $250.0 million and a remaining maximum future advance amount of $20.0 million that can be drawn by the Company to fund approved leasing costs (as defined in the underlying loan agreement), including tenant improvements, leasing commissions and capital expenditures. The loan bears interest at a variable rate of LIBOR plus 3.69% , matures on December 6, 2018 , and requires the payment of interest-only until maturity. As required by the loan agreement, we have entered into an interest rate cap agreement that limits the LIBOR portion of the interest rate to 3.00% . The loan can, at Brookfield DTLA’s option, be prepaid with penalties until June 6, 2018 , after which the loan can be repaid without penalty. Brookfield DTLA has three options to extend the maturity date of the loan, each for a period of one year, subject to meeting certain debt yield and loan to value ratios (as specified in the loan agreement). Debt Modification On September 1, 2016 , Brookfield DTLA modified the mortgage loan secured by 777 Tower, which increased the loan amount from $200.0 million to $220.0 million . As a result of the modification, the Company received net proceeds of $19.7 million , which was used for general corporate purposes. The terms of the modified loan increased the interest rate by 48 basis points to LIBOR plus 2.18% , effective September 1, 2016 . No other terms or conditions of the original loan were changed as part of the modification. Debt Maturities As Brookfield DTLA’s debt matures, principal payment obligations present significant future cash requirements. As of December 31, 2016 , our debt to be repaid during the next five years and thereafter is as follows (in thousands): 2017 $ 589,026 2018 474,233 2019 4,449 2020 168,151 2021 450,000 Thereafter 400,000 $ 2,085,859 As of December 31, 2016 , $765.9 million of our debt may be prepaid without penalty, $400.0 million may be defeased (as defined in the underlying loan agreements), $470.0 million may be prepaid with prepayment penalties, and $450.0 million locked out from prepayment until September 6, 2017 . Wells Fargo Center–North Tower— Brookfield DTLA currently intends to refinance the $550.0 million mortgage loan secured by Wells Fargo Center–North Tower on or about its April 6, 2017 maturity date with new debt with a lower leverage ratio. We do not have a commitment from the lenders to extend the maturity date of or to refinance this loan. This loan will most likely require a paydown upon extension or refinancing (depending on market conditions), funding of additional reserve amounts, or both. As of December 31, 2016 , Brookfield DTLA anticipates the need for additional cash of approximately $90 million to complete the refinancing. We may use cash on hand to make any such payments or cash received as a capital contribution from Brookfield DTLA Holdings. If we are unable or unwilling to use cash on hand or do not use cash contributed by Brookfield DTLA Holdings to make such payments, we may face challenges in repaying, extending or refinancing this loan on favorable terms or at all, and we may be forced to give back the asset to the lenders. Figueroa at 7th— Brookfield DTLA intends to extend or refinance the $35.0 million mortgage loan secured by Figueroa at 7th on or about its September 10, 2017 maturity date. Brookfield DTLA has two options to extend the maturity date of this loan, each for a period of 12 months, subject to meeting certain debt yield and loan to value ratios (as specified in the loan agreement). As of December 31, 2016 , we meet the criteria specified in the loan agreement to extend the maturity date of this loan. Funding of Wells Fargo Center–North Tower Collateral Reserve In connection with the MPG acquisition, Brookfield DTLA Holdings assumed the mortgage loan secured by the Wells Fargo Center–North Tower office property. In connection with the loan assumption, Brookfield DTLA Holdings agreed to deposit funds into a collateral reserve account held by the lender, of which $2.5 million was funded by Brookfield DTLA in each of the years ended December 31, 2015 and 2014 , respectively. The collateral reserve is included as part of restricted cash in the consolidated balance sheet. MPG Office, L.P. Tax Indemnification Agreements In connection with tax indemnification agreements entered into with MPG Office, L.P. prior to the acquisition of MPG in 2013 by Brookfield DTLA, Robert F. Maguire III, certain entities owned or controlled by Mr. Maguire, and other contributors to MPG at the time of its initial public offering guaranteed a portion of the Wells Fargo Center–North Tower and Gas Company Tower mortgage loans. As of December 31, 2016 , these loans are no longer subject to such guarantees. Non-Recourse Carve Out Guarantees All of Brookfield DTLA’s $2.1 billion of mortgage debt is subject to “non-recourse carve out” guarantees that expire upon elimination of the underlying loan obligations. In connection with all of these loans, Brookfield DTLA entered into “non-recourse carve out” guarantees, which provide for these otherwise non-recourse loans to become partially or fully recourse against Brookfield DTLA Holdings or one of its subsidiaries, if certain triggering events occur. Although these events differ from loan to loan, some of the common events include: • The special purpose property-owning subsidiary of Brookfield DTLA Holdings or Brookfield DTLA Holdings filing a voluntary petition for bankruptcy; • The special purpose property-owning subsidiary of Brookfield DTLA Holdings’ failure to maintain its status as a special purpose entity; • Subject to certain conditions, the special purpose property-owning subsidiary of Brookfield DTLA Holdings’ failure to obtain the lender’s written consent prior to any subordinate financing or other voluntary lien encumbering the associated property; and • Subject to certain conditions, the special purpose property-owning subsidiary of Brookfield DTLA Holdings’ failure to obtain the lender’s written consent prior to a transfer or conveyance of the associated property, including, in some cases, indirect transfers in connection with a change in control of Brookfield DTLA Holdings or Brookfield DTLA. In addition, other items that are customarily recourse to a non-recourse carve out guarantor include, but are not limited to, the payment of real property taxes, the breach of representations related to environmental issues or hazardous substances, physical waste of the property, liens which are senior to the mortgage loan and outstanding security deposits. The maximum amount Brookfield DTLA Holdings would be required to pay under a “non‑recourse carve out” guarantee is the principal amount of the loan (or a total of $2.1 billion as of December 31, 2016 for all loans). This maximum amount does not include liabilities related to environmental issues or hazardous substances. Losses resulting from the breach of our loan agreement representations related to environmental issues or hazardous substances are generally recourse to Brookfield DTLA Holdings pursuant to the “non-recourse carve out” guarantees and any such losses would be in addition to the total principal amounts of the loans. The potential losses are not quantifiable and can be material in certain circumstances, depending on the severity of the environmental or hazardous substance issues. Since each of our non-recourse loans is secured by the office building owned by the special purpose property-owning subsidiary of Brookfield DTLA Holdings, the amount due to the lender from Brookfield DTLA Holdings in the event a “non-recourse carve out” guarantee is triggered could subsequently be partially or fully mitigated by the net proceeds received from any disposition of the office building; however, such proceeds may not be sufficient to cover the maximum potential amount due, depending on the particular asset. Debt Reporting Pursuant to the terms of certain of our mortgage loan agreements, Brookfield DTLA is required to report a debt service coverage ratio (“DSCR”) calculated using the formulas specified in the underlying loan agreements. We have submitted the required reports to the lenders for the measurement periods ended December 31, 2016 and were in compliance with the amounts required by the loan agreements. Pursuant to the terms of the Wells Fargo Center–North Tower, EY Plaza, and Figueroa at 7th mortgage loan agreements, we are required to provide annual audited financial statements of Brookfield DTLA Holdings to the lenders or agents. The receipt of any opinion other than an “unqualified” audit opinion on our annual audited financial statements is an event of default under the loan agreements for the properties listed above. If an event of default occurs, the lenders have the right to pursue the remedies contained in the loan documents, including acceleration of all or a portion of the debt and foreclosure. |
Mezzanine Equity
Mezzanine Equity | 12 Months Ended |
Dec. 31, 2016 | |
Temporary Equity Disclosure [Abstract] | |
Mezzanine Equity | Mezzanine Equity Mezzanine equity in the consolidated balance sheet is comprised of the Series A preferred stock, a Series A-1 preferred interest, a senior participating preferred interest and, as of December 31, 2016 , a Series B preferred interest (collectively, the “Preferred Interests”). The Series A-1 preferred interest, senior participating preferred interest and Series B preferred interest are held by a noncontrolling interest holder. The Preferred Interests are classified in mezzanine equity because they are callable, and the holder of the Series A-1 preferred interest, senior participating preferred interest, Series B preferred interest, and some of the Series A preferred stock indirectly controls the ability to elect to redeem such instruments, through its controlling interest in the Company and its subsidiaries. There is no commitment or obligation on the part of Brookfield DTLA or Brookfield DTLA Holdings to redeem the Preferred Interests. See “—Series B Preferred Interest” below for a discussion of the issuance of the Series B preferred interest during the year ended December 31, 2016 . The Preferred Interests included within mezzanine equity were recorded at fair value on the date of issuance and have been adjusted to the greater of their carrying amount or redemption value as of December 31, 2016 and 2015 . Adjustments to increase the carrying amount to redemption value are recorded in the consolidated statement of operations as a redemption measurement adjustment. Dividends and Distributions On January 4, 2016 , Brookfield DTLA paid a cash dividend of $2.25 per share to holders of record of its Series A preferred stock at the close of business on December 15, 2015 using cash on hand. This dividend payment reduced the accumulated and unpaid dividends owed on the Series A preferred stock by $21.9 million . Any future dividends declared would be at the discretion of Brookfield DTLA’s board of directors and would depend on its financial condition, results of operations, contractual obligations and the terms of its financing agreements at the time a dividend is considered, and other relevant factors. During the years ended December 31, 2016 , 2015 and 2014 , the Company paid distributions and dividends totaling $0.6 million , $35.8 million and $220.0 million , respectively, to Brookfield DTLA Holdings related to the senior participating preferred interest. Series A Preferred Stock Brookfield DTLA is authorized to issue up to 10,000,000 shares of Series A preferred stock, $0.01 par value per share, with a liquidation preference of $25.00 per share. As of December 31, 2016 and 2015 , 9,730,370 shares of Series A preferred stock were outstanding, of which 9,357,469 shares were issued to third parties and 372,901 shares were issued to DTLA Fund Holding Co., a subsidiary of Brookfield DTLA Holdings. On January 4, 2016 , Brookfield DTLA paid a cash dividend of $2.25 per share to holders of record of its Series A preferred stock at the close of business on December 15, 2015 using cash on hand. This dividend payment reduced the accumulated and unpaid dividends owed on the Series A preferred stock by $21.9 million . The dividend was declared on December 4, 2015 by the board of directors in connection with the settlement on a class-wide basis of the litigation brought in Maryland State Court and styled as In re MPG Office Trust Inc. Preferred Shareholder Litigation , Case No. 24‑C-13-004097. See Note 13 “Commitments and Contingencies—Litigation—Merger-Related Litigation” for additional information regarding the dividend payment. No dividends were declared on the Series A preferred stock during the years ended December 31, 2016 and 2014 . Dividends on the Series A preferred stock are cumulative, and therefore, will continue to accrue at an annual rate of $1.90625 per share. As of December 31, 2016 , the cumulative amount of unpaid dividends totals $129.6 million and has been reflected in the carrying amount of the Series A preferred stock. The Series A preferred stock does not have a stated maturity and is not subject to any sinking fund or mandatory redemption provisions. Upon liquidation, dissolution or winding up, the Series A preferred stock will rank senior to our common stock with respect to the payment of distributions. We may, at our option, redeem the Series A preferred stock, in whole or in part, for cash at a redemption price of $25.00 per share, plus all accumulated and unpaid dividends on such Series A preferred stock up to and including the redemption date. The Series A preferred stock is not convertible into or exchangeable for any other property or securities of Brookfield DTLA. As of December 31, 2016 , the Series A preferred stock is reported at its redemption value of $372.9 million calculated using the redemption price of $25.00 per share plus all accumulated and unpaid dividends on such Series A preferred stock through December 31, 2016 . Series A-1 Preferred Interest The Series A-1 preferred interest is held by Brookfield DTLA Holdings or wholly owned subsidiaries of Brookfield DTLA Holdings and has a stated value of $225.7 million . The Series A-1 preferred interest has mirror rights to the Series A preferred interests issued by New OP, which are held by a wholly owned subsidiary of Brookfield DTLA, but only with respect to their respective preferred liquidation preferences, and share pro rata with 48.13% to the Series A-1 preferred interest and 51.87% to the Series A preferred interest based on their current liquidation preferences in accordance with their respective preferred liquidation preferences in distributions from New OP, until their preferred liquidation preferences have been reduced to zero. Thereafter, distributions will be made 47.66% to the common component of the Series A interest and 52.34% to the common component of the Series B interest, which is held by Brookfield DTLA Holdings. The economic terms of the Series A preferred stock mirror those of the New OP Series A preferred interests, including distributions in respect of the preferred liquidation preference. As of December 31, 2016 , the Series A-1 preferred interest is reported at its redemption value of $366.3 million calculated using its liquidation value of $225.7 million plus $140.6 million of accumulated and unpaid dividends on such Series A-1 preferred interest through December 31, 2016 . Senior Participating Preferred Interest DTLA OP issued a senior participating preferred interest to Brookfield DTLA Holdings in connection with the formation of Brookfield DTLA and the MPG acquisition. The senior participating preferred interest was comprised of $240.0 million in preferred interests with a 7.0% coupon and a 4.0% participating interest in the residual value of DTLA OP. On March 21, 2014 , Brookfield DTLA made a cash distribution to Brookfield DTLA Holdings totaling $70.0 million , in respect of the senior participating preferred interest held by Brookfield DTLA Holdings, which was comprised of $7.3 million in settlement of preferred dividends on the senior participating preferred interest through March 21, 2014 and a return of investment of $62.7 million using proceeds generated by the refinancing of EY Plaza. On August 28, 2014 , Brookfield DTLA made a cash distribution to Brookfield DTLA Holdings totaling $150.0 million , in respect of the senior participating preferred interest held by Brookfield DTLA Holdings, which was comprised of $5.5 million in settlement of preferred dividends on the senior participating preferred interest through August 28, 2014 and a return of investment of $144.5 million using proceeds generated by the refinancing of BOA Plaza. On December 16, 2015 , Brookfield DTLA made a cash distribution to Brookfield DTLA Holdings totaling $35.8 million , in respect of the senior participating preferred interest held by Brookfield DTLA Holdings, which was comprised of $3.0 million in settlement of preferred dividends on the senior participating preferred interest through December 16, 2015 and a return of investment of $32.8 million using cash on hand. As of December 31, 2015 , the 7.0% preferred interest portion of the senior participating preferred interest had been fully repaid to Brookfield DTLA Holdings. On April 5, 2016 , Brookfield DTLA made a $0.3 million distribution to Brookfield DTLA Holdings as a return of investment related to the senior participating preferred interest held by Brookfield DTLA Holdings using cash on hand. On November 30, 2016 , Brookfield DTLA made a $0.3 million distribution to Brookfield DTLA Holdings as a return of investment related to the senior participating preferred interest held by Brookfield DTLA Holdings using cash on hand. As of December 31, 2016 , the senior participating preferred interest is reported at its redemption value of $25.0 million using the value of the participating interest. Series B Preferred Interest At the time of the merger with MPG, Brookfield DTLA Holdings made a commitment to make capital contributions in cash or property to New OP, which directly or indirectly owns the Brookfield DTLA properties, to fund up to $260.0 million of its future cash needs, for which it will be entitled to receive a preferred return, if and when called by New OP. On May 16, 2016 , New OP issued a Series B preferred interest to Brookfield DTLA Holdings in connection with a $6.0 million cash contribution from Brookfield DTLA Holdings to the Company under this commitment, which is entitled to a preferred return of 9.0% . The Company used these funds for general corporate purposes. On July 11, 2016 and July 13, 2016 , the Company received $30.0 million and $7.0 million , respectively, in cash contributions from Brookfield DTLA Holdings, which are entitled to a preferred return of 9.0% as part of the Series B preferred interest. Of the $37.0 million contributed during July 2016, $19.7 million was used to pay for costs associated with the refinancing of Gas Company Tower, with the remainder used for general corporate purposes. On November 30, 2016 , the Company received $20.3 million in cash contributions from Brookfield DTLA Holdings, which is entitled to a preferred return of 9.0% as part of the Series B preferred interest. The Company used these funds to pay for costs associated with the refinancing of Wells Fargo Center–South Tower. The Series B preferred interest in New OP held by Brookfield DTLA Holdings is effectively senior to the interest in New OP held by Brookfield DTLA and has a priority on distributions senior to the equity securities of such subsidiaries held indirectly by Brookfield DTLA and, as a result, effectively rank senior to the Series A preferred stock. The Series B preferred interest in New OP may limit the amount of funds available to Brookfield DTLA for any purpose, including for dividends or other distributions to holders of its capital stock, including the Series A preferred stock. As of December 31, 2016 , the Series B preferred interest is reported at its redemption value of $65.4 million calculated using its liquidation value of $63.3 million plus $2.1 million of accumulated and unpaid dividends on such Series B preferred interest through December 31, 2016 . Subsequent to December 31, 2016 , the Company received $30.0 million in cash contributions from Brookfield DTLA Holdings that increased the liquidation value of the Series B preferred interest and is entitled to a preferred return of 9.0% . The Company intends to use these funds for general corporate purposes. See Note 16 “Subsequent Event.” Change in Mezzanine Equity A summary of the change in mezzanine equity is as follows (in thousands, except share amounts): Number of Shares of Series A Preferred Stock Series A Preferred Stock Noncontrolling Interests Total Mezzanine Equity Series A-1 Preferred Interest Senior Participating Preferred Interest Series B Preferred Interest Balance, December 31, 2013 9,730,370 $ 339,101 $ 314,658 $ 257,780 $ — $ 911,539 Current dividends 18,548 17,213 10,044 45,805 Redemption measurement adjustment 2,256 2,256 Cash distributions (220,000 ) (220,000 ) Balance, December 31, 2014 9,730,370 357,649 331,871 50,080 — 739,600 Current dividends 18,548 17,213 2,321 38,082 Redemption measurement adjustment 6,626 6,626 Dividends declared (21,893 ) (21,893 ) Cash distributions (35,820 ) (35,820 ) Balance, December 31, 2015 9,730,370 354,304 349,084 23,207 — 726,595 Issuance of Series B preferred interest 63,280 63,280 Current dividends 18,548 17,213 — 2,084 37,845 Cash distributions (616 ) (616 ) Redemption measurement adjustment 2,428 2,428 Balance, December 31, 2016 9,730,370 $ 372,852 $ 366,297 $ 25,019 $ 65,364 $ 829,532 |
Stockholders' Deficit
Stockholders' Deficit | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Stockholders' Deficit | Stockholders’ Deficit Brookfield DTLA is authorized to issue up to 1,000,000 shares of common stock, $0.01 par value per share. As of December 31, 2016 and 2015 , 1,000 shares of common stock were issued and outstanding. No dividends were declared on the common stock during the years ended December 31, 2016 , 2015 and 2014 . Brookfield DTLA has not paid any cash dividends on its common stock in the past. Any future dividends declared would be at the discretion of Brookfield DTLA’s board of directors and would depend on its financial condition, results of operations, contractual obligations and the terms of its financing agreements at the time a dividend is considered, and other relevant factors. On April 21, 2016 , Brookfield DTLA received a $2.5 million capital contribution from Brookfield DTLA Holdings, which was used for general corporate purposes. |
Noncontrolling Interests
Noncontrolling Interests | 12 Months Ended |
Dec. 31, 2016 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interests | Noncontrolling Interests Mezzanine Equity Component The Series A-1 preferred interest, senior participating preferred interest and Series B preferred interest consist of equity interests of New OP, DTLA OP and New OP, respectively, which are owned directly by Brookfield DTLA Holdings. These noncontrolling interests are presented as mezzanine equity in the consolidated balance sheet. See Note 5 “Mezzanine Equity.” Stockholders’ Deficit Component The Series B common interest ranks junior to the Series A preferred stock as to dividends and upon liquidation and is presented in the consolidated balance sheet as noncontrolling interest. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss) Income | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Accumulated Other Comprehensive (Loss) Income | Accumulated Other Comprehensive (Loss) Income A summary of the change in accumulated other comprehensive (loss) income related to Brookfield DTLA’s cash flow hedges is as follows (in thousands): For the Year Ended December 31, 2016 2015 2014 Balance at beginning of year $ (5,415 ) $ (4,337 ) $ 1,007 Other comprehensive income (loss) before reclassifications 2,042 (1,078 ) (5,344 ) Amounts reclassified from accumulated other — — — Net current-year other comprehensive income (loss) 2,042 (1,078 ) (5,344 ) Balance at end of year $ (3,373 ) $ (5,415 ) $ (4,337 ) |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements ASC Topic 820, Fair Value Measurements and Disclosures , defines fair value and establishes a framework for measuring fair value. The objective of fair value is to determine the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (the exit price). ASC Topic 820 established a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three categories: • Level 1—Quoted prices (unadjusted) in active markets that are accessible at the measurement date. • Level 2—Observable prices that are based on inputs not quoted in active markets, but corroborated by market data. • Level 3—Unobservable prices that are used when little or no market data is available. The fair value hierarchy gives the highest priority to Level 1 inputs and the lowest priority to Level 3 inputs. Brookfield DTLA utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs, to the extent possible, as well as consider counterparty credit risk in its assessment of fair value. Recurring Measurements The valuation of Brookfield DTLA’s interest rate swap is determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flow of the derivative. This analysis reflects the contractual terms of the derivative, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. We have incorporated credit valuation adjustments to appropriately reflect both our own and the respective counterparty’s non-performance risk in the fair value measurements. Brookfield DTLA’s (liabilities) assets measured at fair value on a recurring basis, aggregated by the level in the fair value hierarchy within which those measurements fall, are as follows (in thousands): Fair Value Measurements Using Total Fair Value Quoted Prices in Active Markets for Identical (Liabilities) Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Interest rate swap at: December 31, 2016 $ (3,373 ) $ — $ (3,373 ) $ — December 31, 2015 (5,415 ) — (5,415 ) — December 31, 2014 (4,337 ) — (4,337 ) — Interest rate caps at: December 31, 2016 $ 53 $ — $ 53 $ — December 31, 2015 19 — 19 — December 31, 2014 190 — 190 — |
Financial Instruments
Financial Instruments | 12 Months Ended |
Dec. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Instruments | Financial Instruments Derivative Financial Instruments A summary of the fair value of Brookfield DTLA’s derivative financial instruments is as follows (in thousands): Fair Value as of December 31, 2016 December 31, 2015 Derivatives designated as cash flow hedging instruments: Interest rate swap $ (3,373 ) $ (5,415 ) The interest rate swap liability is included in accounts payable and other liabilities in the consolidated balance sheet. A summary of the effect of derivative financial instruments reported in the consolidated financial statements is as follows (in thousands): Amount of Gain (Loss) Recognized in AOCL Amount of Gain (Loss) Reclassified from AOCL to Statement of Operations Derivatives designated as cash flow hedging instruments: Interest rate swap for the year ended: December 31, 2016 $ 2,042 $ — December 31, 2015 (1,078 ) — December 31, 2014 (5,344 ) — Interest Rate Swap— As of December 31, 2016 and 2015 , Brookfield DTLA held an interest rate swap with a notional amount of $185.0 million , which was assigned to the EY Plaza mortgage loan. The swap requires net settlement each month and expires on November 2, 2020 . Interest Rate Caps— Brookfield DTLA holds interest rate caps pursuant to the terms of certain of its mortgage loan agreements with the following notional amounts (in thousands): December 31, 2016 December 31, 2015 Wells Fargo Center–South Tower $ 270,000 $ 290,000 777 Tower 220,000 200,000 $ 490,000 $ 490,000 On September 1, 2016, the Company increased the notional amount of the interest rate cap agreement related to its 777 Tower mortgage loan from $200.0 million to $220.0 million pursuant to the terms of the modified loan agreement. As required by the loan agreement, on December 2, 2016 the Company entered into an interest rate cap agreement related to its Wells Fargo Center–South Tower mortgage loan with a notional amount of $270.0 million . Other Financial Instruments Brookfield DTLA’s other financial instruments that are exposed to concentrations of credit risk consist primarily of cash and accounts receivable. Management routinely assesses the financial strength of its tenants and, as a consequence, believes that its accounts receivable credit risk exposure is limited. Brookfield DTLA places its temporary cash investments with federally insured institutions. Cash balances with any one institution may at times be in excess of the federally insured limits. The estimated fair value and carrying amount of Brookfield DTLA’s mortgage loans are as follows (in thousands): December 31, 2016 December 31, 2015 Estimated fair value $ 2,059,449 $ 2,114,761 Carrying amount 2,085,859 2,117,377 We calculated the estimated fair value of our mortgage loans by discounting the future contractual cash flows of the loans using current risk adjusted rates available to borrowers with similar credit ratings. The estimated fair value of mortgage loans is classified as Level 3. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Intercompany Loan Brookfield DTLA was indebted to BOP Management Inc. (“BOP”), an affiliate of BPO, under a $25.0 million promissory note dated October 11, 2013 that bore interest at 3.25% . For the year ended December 31, 2014 , the Company accrued $0.6 million of interest expense related to this note. During September 2014, Brookfield DTLA paid $25.8 million in full settlement of the principal and interest outstanding on the intercompany loan using proceeds from the mortgage loan secured by the Figueroa at 7th retail property. Management Agreements Brookfield DTLA has entered into arrangements with BOP under which the affiliate provides property management and various other services. Property management fees under these agreements are calculated based on 2.75% of rents collected (as defined in the management agreements). In addition, the Company pays BOP Asset Manager LLC and Brookfield Asset Management Private Institutional Capital Adviser US, LLC an asset management fee, which is calculated based on 0.75% of the capital contributed by Brookfield DTLA Holdings. A summary of costs incurred by Brookfield DTLA under these arrangements, which are included in rental property operating and maintenance expense in the consolidated statement of operations, is as follows (in thousands): For the Year Ended December 31, 2016 2015 2014 Property management fee expense $ 7,964 $ 7,445 $ 8,135 Asset management fee expense 6,330 6,292 6,109 General, administrative and reimbursable expenses 2,466 2,593 2,509 Leasing and construction management fees 3,049 6,396 3,626 Insurance Agreements Brookfield DTLA’s properties are covered under insurance policies entered into by BPO that provide, among other things, all risk property and business interruption coverage for BPO’s commercial portfolio with an aggregate limit of $2.5 billion per occurrence as well as an aggregate limit of $370.0 million of earthquake, flood and weather catastrophe insurance. In addition, Brookfield DTLA’s properties are covered by a terrorism insurance policy that provides aggregate coverage of $4.0 billion for all of BPO’s U.S. properties. Brookfield DTLA is in compliance with the contractual obligations regarding terrorism insurance contained in such policies. Insurance premiums for Brookfield DTLA’s properties are paid by an affiliate of BPO and Brookfield DTLA reimburses this BPO affiliate for the actual cost of such premiums. Prior to their expiration, which became effective on April 19, 2014, the MPG properties were covered under an insurance policy that provided all risk property and business interruption coverage with an aggregate limit of $1.25 billion and a $130.0 million aggregate limit of earthquake insurance, and a terrorism insurance policy with a $1.25 billion aggregate limit. Effective April 19, 2014, the MPG properties were added to the existing BPO insurance policies described above. A summary of costs incurred by Brookfield DTLA under this arrangement, which are included in rental property operating and maintenance expense in the consolidated statement of operations, is as follows (in thousands): For the Year Ended December 31, 2016 2015 2014 Insurance expense $ 7,948 $ 8,532 $ 8,466 |
Rental Income
Rental Income | 12 Months Ended |
Dec. 31, 2016 | |
Leases [Abstract] | |
Rental Income | Rental Income Brookfield DTLA’s properties are leased to tenants under net operating leases with initial expiration dates ranging from 2017 to 2035 . The future minimum base rental income (on a non-straight-line basis) to be received under noncancelable tenant operating leases in effect as of December 31, 2016 is as follows (in thousands): 2017 $ 155,308 2018 149,122 2019 147,556 2020 139,895 2021 135,787 Thereafter 564,642 $ 1,292,310 Certain leases with retail tenants also provide for the payment by the lessee of additional rent based on a percentage of the tenants’ sales. The amounts shown in the table above do not include percentage rents. The Company recorded percentage rents totaling $2.8 million , $2.8 million and $1.4 million for the years ended December 31, 2016 , 2015 and 2014 , respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Tenant Concentration Brookfield DTLA generally does not require collateral or other security from its tenants, other than security deposits or letters of credit. Our credit risk is mitigated by the high quality of our existing tenant base, review of prospective tenants’ risk profiles prior to lease execution, and frequent monitoring of our tenant portfolio to identify problem tenants. However, since we have a significant concentration of rental revenue from certain tenants, the inability of those tenants to make their lease payments could have a material adverse effect on our results of operations, cash flow or financial condition. A significant portion of Brookfield DTLA’s rental income and tenant reimbursements revenue is generated by a small number of tenants. No tenant accounted for more than 10% of our consolidated rental income and tenant reimbursements revenue during the years ended December 31, 2016 , 2015 and 2014 . During the years ended December 31, 2016 , 2015 and 2014 , EY Plaza, BOA Plaza, Wells Fargo Center–North Tower, Wells Fargo Center–South Tower, Gas Company Tower and 777 Tower each contributed more than 10% of Brookfield DTLA’s consolidated revenue. The revenue generated by these six properties totaled 100% , 98% and 100% of Brookfield DTLA’s consolidated revenue during the years ended December 31, 2016 , 2015 and 2014 , respectively. Litigation General— Brookfield DTLA and its subsidiaries may be subject to pending legal proceedings and litigation incidental to its business. After consultation with legal counsel, management believes that any liability that may potentially result upon resolution of such matters is not expected to have a material adverse effect on the Company’s business, financial condition or consolidated financial statements as a whole. Merger-Related Litigation— Following the announcement of the execution of the Agreement and Plan of Merger dated as of April 24, 2013, as amended (the “Merger Agreement”), seven putative class actions were filed against Brookfield Office Properties Inc. (“BPO”), Brookfield DTLA, Brookfield DTLA Holdings LLC, Brookfield DTLA Fund Office Trust Inc., Brookfield DTLA Fund Properties (collectively, the “Brookfield Parties”), MPG Office Trust, Inc., MPG Office, L.P., and the members of MPG Office Trust, Inc.’s board of directors. Five of these lawsuits were filed on behalf of MPG Office Trust, Inc.’s common stockholders: (i) two lawsuits, captioned Coyne v. MPG Office Trust, Inc., et al ., No. BC507342 (the “Coyne Action”), and Masih v. MPG Office Trust, Inc., et al. , No. BC507962 (the “Masih Action”), were filed in the Superior Court of the State of California in Los Angeles County (the “California State Court”) on April 29, 2013 and May 3, 2013, respectively; and (ii) three lawsuits, captioned Kim v. MPG Office Trust, Inc. et al ., No. 24‑C-13-002600 (the “Kim Action”), Perkins v. MPG Office Trust, Inc., et al. , No. 24-C-13-002778 (the “Perkins Action”) and Dell’Osso v. MPG Office Trust, Inc., et al., No. 24‑C-13-003283 (the “Dell’Osso Action”) were filed in the Circuit Court for Baltimore City, Maryland on May 1, 2013, May 8, 2013 and May 22, 2013, respectively (collectively, the “Common Stock Actions”). Two lawsuits, captioned Cohen v. MPG Office Trust, Inc. et al. , No. 24-C-13-004097 (the “Cohen Action”) and Donlan v. Weinstein, et al ., No. 24‑C-13-004293 (the “Donlan Action”), were filed on behalf of MPG Office Trust, Inc.’s preferred stockholders in the Circuit Court for Baltimore City, Maryland on June 20, 2013 and July 2, 2013, respectively (collectively, the “Preferred Stock Actions”). In each of the Common Stock Actions, the plaintiffs allege, among other things, that MPG Office Trust, Inc.’s board of directors breached their fiduciary duties in connection with the merger by failing to maximize the value of MPG Office Trust, Inc. and ignoring or failing to protect against conflicts of interest, and that the relevant Brookfield Parties named as defendants aided and abetted those breaches of fiduciary duty. The Kim Action further alleges that MPG Office, L.P. also aided and abetted the breaches of fiduciary duty by MPG Office Trust, Inc.’s board of directors, and the Dell’Osso Action further alleges that MPG Office Trust, Inc. and MPG Office, L.P. aided and abetted the breaches of fiduciary duty by MPG Office Trust, Inc.’s board of directors. On June 4, 2013, the Kim and Perkins plaintiffs filed identical, amended complaints in the Circuit Court for Baltimore City, Maryland. On June 5, 2013, the Masih plaintiffs also filed an amended complaint in the Superior Court of the State of California in Los Angeles County. The three amended complaints, as well as the Dell’Osso Action complaint, allege that the preliminary proxy statement filed by MPG Office Trust, Inc. with the SEC on May 21, 2013 is false and/or misleading because it fails to include certain details of the process leading up to the merger and fails to provide adequate information concerning MPG Office Trust, Inc.’s financial advisors. In each of the Preferred Stock Actions, which were brought on behalf of MPG Office Trust, Inc.’s preferred stockholders, the plaintiffs allege, among other things, that, by entering into the Merger Agreement and tender offer, MPG Office Trust, Inc. breached the Articles Supplementary, which governs the issuance of the MPG preferred shares, that MPG Office Trust, Inc.’s board of directors breached their fiduciary duties by agreeing to a merger agreement that violated the preferred stockholders’ contractual rights and that the relevant Brookfield Parties named as defendants aided and abetted those breaches of contract and fiduciary duty. On July 15, 2013, the plaintiffs in the Preferred Stock Actions filed a joint amended complaint in the Circuit Court for Baltimore City, Maryland that further alleged that MPG Office Trust, Inc.’s board of directors failed to disclose material information regarding BPO’s extension of the tender offer. The plaintiffs in the seven lawsuits sought an injunction against the merger, rescission or rescissory damages in the event the merger has been consummated, an award of fees and costs, including attorneys’ and experts’ fees, and other relief. On July 10, 2013, solely to avoid the costs, risks and uncertainties inherent in litigation, the Brookfield Parties and the other named defendants in the Common Stock Actions signed a memorandum of understanding, regarding a proposed settlement of all claims asserted therein. The parties subsequently entered into a stipulation of settlement dated November 21, 2013 providing for the release of all asserted claims, additional disclosures by MPG concerning the merger made prior to the merger’s approval, and the payment, by defendants, of an award of attorneys’ fees and expenses in an amount not to exceed $475,000 . After a hearing on June 4, 2014, the California State Court granted plaintiffs’ motion for final approval of the settlement and entered a Final Order and Judgment, awarding plaintiffs’ counsel’s attorneys’ fees and expenses in the amount of $475,000 , which was paid by MPG Office LLC on June 18, 2014. In the Preferred Stock Actions, at a hearing on July 24, 2013, the Maryland State Court denied the plaintiffs’ motion for preliminary injunction seeking to enjoin the tender offer. The plaintiffs filed a second amended complaint on November 22, 2013 that added additional arguments in support of their allegations that the new preferred shares do not have the same rights as the MPG preferred shares. The defendants moved to dismiss the second amended complaint on December 20, 2013, and briefing on the motion concluded on February 28, 2014. At a hearing on June 18, 2014, the Maryland State Court heard oral arguments on the defendants’ motion to dismiss and reserved judgment on the decision. On October 21, 2014, the parties sent a joint letter to the Maryland State Court stating that since the June 18 meeting the parties have commenced discussions towards a possible resolution of the lawsuit, requesting that the court temporarily refrain from deciding the pending motion to dismiss to facilitate the discussions. On March 30, 2015 , the plaintiff in the Cohen Actions and the defendants entered into a memorandum of understanding setting forth an agreement in principle to settle the Preferred Stock Actions on a class-wide basis and dismiss the case with prejudice in exchange for the payment of $2.25 per share of Series A preferred stock of accumulated and unpaid dividends (the “Dividend Payment”) to holders of record on a record date to be set after final approval of the settlement by the Maryland State Court, plus any attorneys’ fees awarded by the Maryland State Court to the plaintiff’s counsel. The dividend would reduce the amount of accumulated and unpaid dividends on the Series A preferred stock, and the terms of the Series A preferred stock would otherwise remain unchanged. On August 18, 2015, the Maryland State Court entered an order preliminarily approving the settlement and scheduling a final fairness hearing for October 27, 2015. On September 28, 2015, the plaintiff filed a motion for final certification of the settlement class, final approval of the class action settlement and approval of attorneys’ fees and reimbursement of expenses, seeking a total fee and expense award of $5,250,000 . The defendants submitted their opposition to the plaintiff’s fee application on October 13, 2015. On October 16, 2015, the plaintiff filed a motion seeking discovery related to the valuation of the Dividend Payment in connection with its fee application and served related discovery requests on the defendants. On October 23, 2015, the defendants filed their opposition to that motion, as well as a motion for a protective order precluding discovery. On October 27, 2015, the Maryland State Court held a hearing to decide whether to grant final approval of the settlement and to rule on the parties’ discovery motions. At the hearing, the Court ordered limited discovery to occur prior to ruling on the fee application. On October 28, 2015, the Maryland State Court issued an order granting final approval of the settlement. The time to appeal the order expired on November 30, 2015 without any appeals having been filed. On December 4, 2015 , in accordance with the final approval order and the terms of the parties’ settlement agreement, the board of directors declared a cash dividend of $2.25 per share to holders of record of its Series A preferred stock at the close of business on December 15, 2015 . On January 4, 2016 , Brookfield DTLA paid the Dividend Payment totaling $21.9 million using cash on hand. On December 16, 2015, after taking certain limited discovery permitted by the Maryland State Court during the October 27 hearing, the plaintiff served the defendants with its reply memorandum of law in support of its motion for attorneys’ fees and expenses. That same day, the plaintiff requested that the Court permit it to file the reply memorandum and an exhibit thereto under seal given the confidential nature of the information contained therein. On December 17, 2015, the plaintiff provided the Court with plaintiff’s counsel’s time records for the Court’s in camera review. On January 15, 2016, the defendants filed a surreply to the plaintiff’s reply memorandum after obtaining the Court’s permission to do so. After a hearing on April 6, 2016, the Maryland State Court issued an order on April 18, 2016 granting an award of attorneys’ fees and expenses to the plaintiffs totaling $2,212,688 . On April 21, 2016 , the Company paid the awarded amount to the plaintiffs’ counsel. On July 13, 2016 , BPO and the Company entered into a settlement agreement with the insurance carrier under the MPG directors and officers liability insurance policy that was in effect at the time of the merger. On August 17, 2016 , the Company received a settlement payment from the insurance carrier totaling $1,106,344 , which partially reimbursed the Company for amounts paid to settle both the Common Stock Actions and the Preferred Stock Actions. The Company included the settlement in interest and other revenue in its consolidated statement of operations for the year ended December 31, 2016 . |
Quarterly Financial Information
Quarterly Financial Information (Unaudited) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information (Unaudited) | Quarterly Financial Information (Unaudited) First Quarter Second Quarter Third Quarter Fourth Quarter (In thousands) Year Ended December 31, 2016 Revenue $ 74,813 $ 78,968 $ 77,408 $ 79,503 Expenses 84,785 87,230 86,802 90,042 Net loss (9,972 ) (8,262 ) (9,394 ) (10,539 ) Net loss attributable to noncontrolling interests: Series A-1 preferred interest – current dividends 4,303 4,303 4,303 4,304 Senior participating preferred interest – current dividends — — — — Senior participating preferred interest – redemption measurement adjustment 656 400 908 464 Series B preferred interest – current dividends — 68 881 1,135 Series B common interest – allocation of net loss (10,242 ) (9,248 ) (10,532 ) (11,033 ) Net loss attributable to Brookfield DTLA (4,689 ) (3,785 ) (4,954 ) (5,409 ) Series A preferred stock – current dividends 4,637 4,637 4,637 4,637 Net loss available to common interest holders of Brookfield DTLA $ (9,326 ) $ (8,422 ) $ (9,591 ) $ (10,046 ) Year Ended December 31, 2015 Revenue $ 73,508 $ 77,438 $ 74,561 $ 73,583 Expenses 82,569 84,166 83,908 88,801 Net loss (9,061 ) (6,728 ) (9,347 ) (15,218 ) Net loss attributable to noncontrolling interests: Series A-1 preferred interest – current dividends 4,303 4,303 4,303 4,304 Senior participating preferred interest – current dividends 587 597 608 529 Senior participating preferred interest – redemption measurement adjustment 760 1,540 804 3,521 Series B preferred interest – current dividends — — — — Series B common interest – allocation of net loss (10,127 ) (9,319 ) (10,310 ) (14,765 ) Net loss attributable to Brookfield DTLA (4,584 ) (3,849 ) (4,752 ) (8,807 ) Series A preferred stock – current dividends 4,637 4,637 4,637 4,637 Net loss available to common interest holders of Brookfield DTLA $ (9,221 ) $ (8,486 ) $ (9,389 ) $ (13,444 ) |
Investments in Real Estate
Investments in Real Estate | 12 Months Ended |
Dec. 31, 2016 | |
SEC Schedule III, Real Estate and Accumulated Depreciation Disclosure [Abstract] | |
Investments in Real Estate | Investments in Real Estate A summary of information related to Brookfield DTLA’s investments in real estate as of December 31, 2016 is as follows (in thousands): Encum- brances Initial Cost to Company Costs Capitalized Subsequent to Acquisition Gross Amount at Which Carried at Close of Period Accum- ulated Depre- ciation (2) Year Acquired Land Buildings and Improve- ments Improve- ments Carrying Costs Land Buildings and Improve- ments Total (1) Los Angeles, CA Wells Fargo Center– North Tower 333 S. Grand Avenue $ 550,000 $ 41,024 $ 456,363 $ 57,660 $ — $ 41,024 $ 514,023 $ 555,047 $ 49,817 2013 BOA Plaza 400,000 54,163 354,422 50,057 — 54,163 404,479 458,642 94,712 2006 Wells Fargo Center– South Tower 355 S. Grand Avenue 250,000 21,231 401,149 17,633 — 21,231 418,782 440,013 35,318 2013 Gas Company 450,000 20,742 396,159 53,569 — 20,742 449,728 470,470 30,797 2013 EY Plaza (3) 725 S. Figueroa 215,859 47,385 286,982 117,372 — 47,385 404,354 451,739 86,133 2006 777 Tower 777 S. Figueroa 220,000 38,010 303,697 17,798 — 38,010 321,495 359,505 32,372 2013 Miscellaneous — 5,000 — 357 — 5,000 357 5,357 — $ 2,085,859 $ 227,555 $ 2,198,772 $ 314,446 $ — $ 227,555 $ 2,513,218 $ 2,740,773 $ 329,149 __________ (1) The aggregate gross cost of Brookfield DTLA’s investments in real estate for federal income tax purposes approximated $2.7 billion as of December 31, 2016 . (2) Depreciation in the consolidated statements of operations is computed on a straight-line basis over the following estimated useful lives: buildings ( 60 years, with an estimated salvage value of 5% ), building improvements (ranging from 7 years to 25 years), and tenant improvements (the shorter of the useful life or the applicable lease term). (3) Includes the mortgage loan encumbering the Figueroa at 7th retail property. The following is a reconciliation of Brookfield DTLA’s investments in real estate (in thousands): For the Year Ended December 31, 2016 2015 2014 Investments in Real Estate Balance at beginning of year $ 2,675,249 $ 2,619,422 $ 2,557,865 Additions during the year: Acquisitions — — — Improvements 65,524 57,827 61,557 Deductions during the year: Dispositions — 2,000 — Other — — — Balance at end of year $ 2,740,773 $ 2,675,249 $ 2,619,422 The following is a reconciliation of Brookfield DTLA’s accumulated depreciation on its investments in real estate (in thousands): For the Year Ended December 31, 2016 2015 2014 Accumulated Depreciation Balance at beginning of year $ 256,130 $ 189,108 $ 121,612 Additions during the year: Depreciation expense 73,019 67,022 67,496 Deductions during the year: Other — — — Balance at end of year $ 329,149 $ 256,130 $ 189,108 |
Subsequent Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent Event Contributions from Brookfield DTLA Holdings Subsequent to December 31, 2016 , the Company received $30.0 million in cash contributions from Brookfield DTLA Holdings, which is entitled to a preferred return of 9.0% as part of the Series B preferred interest. The Company intends to use these funds for general corporate purposes. |
Basis of Presentation and Sum24
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation As used in these consolidated financial statements and related notes, unless the context requires otherwise, the terms “Brookfield DTLA,” the “Company,” “us,” “we” and “our” refer to Brookfield DTLA Fund Office Trust Investor Inc. The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated balance sheets as of December 31, 2016 and 2015 include the accounts of Brookfield DTLA and subsidiaries in which it has a controlling financial interest. All intercompany transactions have been eliminated in consolidation as of and for the years ended December 31, 2016 , 2015 and 2014 . |
Consolidation of Variable Interest Entities | In determining whether Brookfield DTLA has a controlling financial interest in an entity and the requirement to consolidate the accounts of that entity, management considers factors such as ownership interest, board representation, management representation, authority to make decisions, and contractual and substantive participating rights of the partners/members as well as whether the entity is a variable interest entity (“VIE”) and Brookfield DTLA is the primary beneficiary. A VIE is broadly defined as an entity where either (i) the equity investors as a group, if any, lack the power through voting or similar rights to direct the activities of an entity that most significantly impact the entity’s economic performance or (ii) the equity investment at risk is insufficient to finance that entity’s activities without additional subordinated financial support. A variable interest holder is considered to be the primary beneficiary of a VIE if it has the power to direct the activities of a variable interest entity that most significantly impact the entity’s economic performance and has the obligation to absorb losses of, or the right to receive benefits from, the entity that could potentially be significant to the VIE. Brookfield DTLA qualitatively assesses whether it is (or is not) the primary beneficiary of a VIE. Consideration of various factors includes, but is not limited to, Brookfield DTLA’s ability to direct the activities that most significantly impact the VIE’s economic performance, its form of ownership interest, its representation on the VIE’s governing body, the size and seniority of its investment, its ability and the rights of other investors to participate in policy making decisions and its ability to replace the manager of and/or liquidate the entity. The Company earns a return through an indirect investment in Brookfield DTLA Fund Properties II LLC (“New OP”). Brookfield DTLA Holdings, the parent of Brookfield DTLA, owns all of the common interest in New OP. Brookfield DTLA has an indirect preferred stock interest in New OP and its wholly owned subsidiary is the managing member of New OP. The Company determined that New OP is a VIE and as a result of having the power to direct the significant activities of New OP and exposure to the economic performance of New OP, Brookfield DTLA meets the two conditions for being the primary beneficiary. Brookfield DTLA is required to continually evaluate its VIE relationships and consolidation conclusion. |
Reclassifications | Reclassifications We had reported $220,000 of distributions to Brookfield DTLA Holdings in the consolidated statement of cash flows for the year ended December 31, 2014 . We have reclassified this total to show $207,231 as distributions to senior participating preferred interest and $12,769 as dividends paid to senior participating preferred interest so as to conform to the 2016 and 2015 presentation. In December 2015, Brookfield DTLA adopted the guidance in Accounting Standards Update (“ASU”) 2015-03, Simplifying the Presentation of Debt Issuance Costs , which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability. We have combined the amortization of deferred financing costs ( $1,007 ) and the amortization of debt discounts ( $5,042 ) for the year ended December 31, 2014 and presented a new total ( $6,049 ) in the consolidated statement of cash flows so as to reflect the presentation of such costs in the consolidated balance sheet. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. For example, estimates and assumptions have been made with respect to fair values of assets and liabilities for purposes of applying the acquisition method of accounting, the useful lives of assets, recoverable amounts of receivables, impairment of long‑lived assets and fair value of debt. Actual results could ultimately differ from such estimates. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (the “FASB”) issued ASU 2014-09 establishing Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. ASU 2014-09 establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. ASU 2014-09 requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration that the entity expects to be entitled to receive in exchange for those goods or services and also requires certain additional disclosures. ASU 2014-09 is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2017. We are currently evaluating the impact of the adoption of ASU 2014-09 on Brookfield DTLA’s consolidated financial statements. In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. This topic provides guidance on management’s responsibility to evaluate whether there is substantial doubt about a company’s ability to continue as a going concern and requires related footnote disclosures. The guidance in ASU 2014-15 became effective for Brookfield DTLA for year-end December 31, 2016. The implementation of this pronouncement did not have a material impact on Brookfield DTLA’s consolidated financial statements. In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis to ASC Topic 810 , Consolidation . ASU 2015-02 affects reporting entities that are required to evaluate whether they should consolidate certain legal entities. Specifically, the amendments: (i) modify the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities, (ii) eliminate the presumption that a general partner should consolidate a limited partnership, (iii) affect the consolidated analysis of reporting entities that are involved with VIEs, and (iv) provide a scope exception for certain entities. The guidance in ASU 2015-02 became effective for Brookfield DTLA beginning January 1, 2016. The implementation of this pronouncement did not have a material impact on Brookfield DTLA’s consolidated financial statements. In April 2015, the FASB issued ASU 2015-03 that requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts, as opposed to being presented as assets. Brookfield DTLA elected to early adopt ASU 2015-03 effective as of December 31, 2015. There was no effect on Brookfield DTLA’s consolidated statement of operations for the year ended December 31, 2014 as a result of adopting this pronouncement. In February 2016, the FASB issued ASU 2016-02 establishing ASC Topic 842, Leases . The guidance in this update supersedes the guidance in ASC Topic 840, Leases . ASU 2016-02 revises GAAP related to accounting for leases by lessees. Under this new guidance, lessees will be required to recognize a lease liability and a right-of-use asset in the balance sheet for all leases with terms greater than 12 months. Leases will be classified as either finance or operating, with classification determining the pattern of expense recognition in the statement of operations. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and should be applied using a modified retrospective approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Early adoption is permitted. We are currently evaluating the impact of the adoption of ASU 2016-02 on Brookfield DTLA’s consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments to ASC Topic 230, Statement of Cash Flows . ASU 2016-15 clarifies guidance on the classification of certain cash receipts and payments in the statement of cash flows to reduce diversity in practice with respect to (i) debt prepayment or debt extinguishment costs, (ii) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing, (iii) contingent consideration payments made after a business combination, (iv) proceeds from the settlement of insurance claims, (v) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies, (vi) distributions received from equity method investees, (vii) beneficial interests in securitization transactions, and (viii) separately identifiable cash flows and application of the predominance principle. ASU 2016-15 is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2017, with early adoption permitted. We do not expect the adoption of this update to have a material impact on Brookfield DTLA’s consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, Restricted Cash to ASC Topic 230, Statement of Cash Flows . ASU 2016-18 requires entities to show the changes in the total of cash, cash equivalents, restricted cash, and restricted cash equivalents in the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. ASU 2016-18 is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption permitted, including adoption in an interim period. Upon adoption, we will retrospectively reconcile the activity in our cash, cash equivalents, restricted cash and restricted cash equivalents during reporting periods. In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business to ASC Topic 805, Business Combinations. ASU 2017-01 introduced amendments that are intended to make the guidance on the definition of a business more consistent and cost-efficient. The objective of the update is to add further guidance that assists entities in evaluating whether a transaction should be accounted for as an acquisition (or disposal) of assets or a business by providing a screen to determine when a set of assets and activities acquired is not a business. ASU 2017-01 is effective for annual periods beginning after December 15, 2017 including interim periods within those periods. ASU 2017-01 must be applied prospectively on or after the effective date. We are currently evaluating the impact of the adoption of ASU 2017-01 on Brookfield DTLA’s consolidated financial statements. |
Business Combinations | Business Combinations— Purchase accounting is applied to the assets and liabilities related to all real estate investments acquired from third parties. In accordance with FASB ASC Topic 805, Business Combinations , the purchase price of real estate acquired is allocated to acquired tangible assets, consisting primarily of land, building and tenant improvements, and identifiable intangible assets and liabilities, consisting of the value of above- and below-market leases, in-place leases, and tenant relationships, based in each case on their fair value. The principal valuation technique employed by Brookfield DTLA in determining the fair value of identified assets acquired and liabilities assumed is the income approach, which is then compared to the cost approach. Tangible values for investments in real estate are calculated based on replacement costs for like type quality assets. Above- and below-market lease values are determined by comparing in-place rents with current market rents. In‑place lease amounts are determined by calculating the potential lost revenue during the replacement of the current leases in place. Leasing commissions and legal/marketing fees are determined based upon market allowances pro-rated over the remaining lease terms. Mortgage loans assumed in an acquisition are analyzed using current market terms for similar debt. The value of the acquired above-market and below-market leases are amortized and recorded as either a decrease (in the case of above-market leases) or an increase (in the case of below-market leases) to rental income in the consolidated statement of operations over the remaining term of the associated lease. The value of tenant relationships is amortized over the expected term of the relationship, which includes an estimated probability of lease renewal. The value of in-place leases is amortized as an expense over the remaining life of the leases. Amortization of tenant relationships and in‑place leases is included in depreciation and amortization in the consolidated statement of operations. |
Investments in Real Estate | Investments in Real Estate— Land is carried at cost. Buildings are recorded at historical cost and are depreciated on a straight-line basis over the estimated useful life of the building, which is 60 years with an estimated salvage value of 5% . Building improvements are recorded at historical cost and are depreciated on a straight-line basis over their estimated useful lives, which range from 7 years to 25 years. Tenant improvements that are determined to be assets of Brookfield DTLA are recorded at cost; amortization is included in depreciation and amortization expense in the consolidated statement of operations on a straight-line basis over the shorter of the useful life or the applicable lease term. Depreciation expense related to investments in real estate during the years ended December 31, 2016 , 2015 and 2014 was $73.0 million , $67.0 million and $67.5 million , respectively. Real estate is reviewed for impairment if events or changes in circumstances indicate that the carrying amount of the real estate may not be recoverable. In such an event, a comparison is made of the current and projected operating cash flows of the property into the foreseeable future on an undiscounted basis to the carrying amount of the real estate. If the undiscounted cash flows expected to be generated by an asset are less than its carrying amount, an impairment provision would be recorded to write down the carrying amount of such asset to its fair value. Brookfield DTLA assesses fair value based on estimated cash flow projections utilizing appropriate discount and capitalization rates and available market information. Projections of future cash flow take into account the specific business plan for the property and management’s best estimate of the most probable set of economic conditions expected to prevail in the market. Management believes no impairment of Brookfield DTLA’s real estate assets existed at December 31, 2016 and 2015 . |
Cash and Cash Equivalents | Cash and Cash Equivalents— Cash and cash equivalents include all cash and short-term investments with an original maturity of three months or less. |
Restricted Cash | Restricted Cash— Restricted cash consists primarily of deposits for tenant improvements and leasing commissions, real estate taxes and insurance reserves, debt service reserves and other items as required by our mortgage loan agreements. |
Rents, Deferred Rents and Other Receivables, Net | Rents, Deferred Rents and Other Receivables, Net— Differences between rental income and the contractual amounts due are recorded as deferred rents receivable in the consolidated balance sheet. Brookfield DTLA evaluates its deferred rents receivable to consider if an allowance is necessary. Rents, deferred rents and other receivables, net also includes any amounts paid to a tenant for improvements owned or costs incurred by the tenant are treated as tenant inducements and are presented in the consolidated balance sheet net of accumulated amortization totaling $9.9 million and $6.5 million as of December 31, 2016 and 2015 , respectively. Amortization of tenant inducements is recorded on a straight-line basis over the term of the related lease as a reduction of rental income in the consolidated statement of operations. Brookfield DTLA periodically evaluates the collectability of amounts due from tenants and maintains an allowance for doubtful accounts in the consolidated balance sheet for estimated losses resulting from the inability of tenants to make required payments under the lease agreements. Management exercises judgment in establishing these allowances and considers payment history and current credit status in developing these estimates. The allowance for doubtful accounts for Brookfield DTLA totaled $0.2 million and $0.5 million as of December 31, 2016 and 2015 , respectively. For the year ended December 31, 2016 , Brookfield DTLA recorded a $271 thousand recovery of doubtful accounts. For the years ended December 31, 2015 and 2014 , Brookfield DTLA recorded provisions for doubtful accounts of $103 thousand and $24 thousand , respectively. |
Deferred Charges, Net | Deferred Charges, Net— Leasing costs are deferred and are presented as deferred charges in the consolidated balance sheet net of accumulated amortization totaling $49.6 million and $38.2 million as of December 31, 2016 and 2015 , respectively. Deferred leasing costs are amortized on a straight-line basis over the terms of the related leases as part of depreciation and amortization in the consolidated statement of operations. |
Mortgage Loans, Net | Mortgage Loans, Net— Mortgage loans are presented in the consolidated balance sheet net of unamortized discounts and debt issuance costs totaling $9.1 million and $6.0 million as of December 31, 2016 and 2015 , respectively. Discounts and debt issuance costs totaling $4.3 million , $5.1 million and $6.0 million were amortized during the years ended December 31, 2016 , 2015 and 2014 , respectively, over the terms of the related mortgage loans on a basis that approximates the effective interest method and are included as part of interest expense in the consolidated statement of operations. |
Revenue Recognition | Revenue Recognition— Rental income from leases providing for periodic increases in base rent is recognized on a straight-line basis over the noncancelable term of the respective leases. Certain leases with retail tenants also provide for the payment by the lessee of additional rent based on a percentage of the tenants’ sales. Percentage rents are recognized only after the tenant sales thresholds have been achieved. Recoveries of operating expenses and real estate taxes are recorded as tenant reimbursements in the consolidated statement of operations in the period during which the expenses are incurred. |
Income Taxes | Income Taxes— Brookfield DTLA has elected to be taxed as a real estate investment trust (“REIT”) pursuant to Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), commencing with its tax period ended December 31, 2013. Brookfield DTLA conducts and intends to conduct its operations so as to continue to qualify as a REIT. Accordingly, Brookfield DTLA is not subject to U.S. federal income tax, provided that it continues to qualify as a REIT and distributions to its stockholders, if any, generally equal or exceed its taxable income. Brookfield DTLA has elected to treat certain of its subsidiaries as taxable REIT subsidiaries (“TRS”). Certain activities that we undertake must be conducted by a TRS, such as non-customary services for our tenants, and holding assets that we cannot hold directly. A TRS is subject to both federal and state income taxes. Qualification and taxation as a REIT depends upon Brookfield DTLA’s ability to meet the various qualification tests imposed under the Code related to annual operating results, asset diversification, distribution levels and diversity of stock ownership. Accordingly, no assurance can be given that Brookfield DTLA will be organized or be able to operate in a manner so as to continue to qualify as a REIT. If Brookfield DTLA fails to qualify as a REIT in any taxable year, it will be subject to federal and state income tax on its taxable income at regular corporate tax rates, and it may be ineligible to qualify as a REIT for four subsequent tax years. Brookfield DTLA may also be subject to certain state or local income taxes, or franchise taxes on its REIT activities. Brookfield DTLA made no provision for income taxes in its consolidated financial statements for the years ended December 31, 2016 , 2015 and 2014 . Brookfield DTLA’s taxable income or loss is different than its financial statement income or loss. Brookfield DTLA recognizes tax benefits from uncertain tax positions when it is more likely than not that the position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits. Income tax positions must meet a more likely than not recognition threshold. Brookfield DTLA had no unrecognized tax benefits of December 31, 2016 and 2015 , and Brookfield DTLA does not expect its unrecognized tax benefits balance to change during the next 12 months. As of December 31, 2016 , Brookfield DTLA’s 2013 tax period and 2014 and 2015 tax years remain open due to the statute of limitations and may be subject to examination by federal, state and local authorities. The 2012 tax year as well as the short tax period ended October 15, 2013 for Brookfield DTLA and its subsidiaries remain open due to the statute of limitations and may be subject to examination by federal, state and local tax authorities. |
Derivative Financial Instruments | Derivative Financial Instruments— Brookfield DTLA uses interest rate swap and cap contracts to manage risk from fluctuations in interest rates as well as to hedge anticipated future financing transactions. Interest rate swaps involve the receipt of variable-rate amounts in exchange for fixed-rate payments over the life of the agreements without exchange of the underlying principal amount. Interest rate caps involve the receipt of variable-rate amounts beyond a specified strike price over the life of the agreements without exchange of the underlying principal amount. The Company believes these agreements are with counterparties who are creditworthy financial institutions. Brookfield DTLA adheres to the provisions of ASC Subtopic 815-10-15, Derivatives and Hedging (“ASC 815-10-15”). ASC 815-10-15 establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and for hedging activities. It requires the recognition of all derivative instruments as assets or liabilities in the Company’s consolidated balance sheet at fair value. Changes in the fair value of derivative instruments that are not designated as hedges, or that do not meet the hedge accounting criteria in ASC 815-10-15, are required to be reported through the statement of operations. Brookfield DTLA has elected to designate its interest rate swap as a cash flow hedge. |
Segment Reporting | Segment Reporting Brookfield DTLA operates in a single reportable segment referred to as its office segment, which includes the operation and management of commercial office properties. Each of Brookfield DTLA’s operating properties is considered a separate operating segment, as each property earns revenues and incurs expenses, individual operating results are reviewed and discrete financial information is available. Management does not distinguish or group Brookfield DTLA’s consolidated operations based on geography, size or type. Brookfield DTLA’s operating properties have similar economic characteristics and provide similar products and services to tenants. As a result, Brookfield DTLA’s operating properties are aggregated into a single reportable segment. |
Accounting for Conditional Asset Retirement Obligations | Accounting for Conditional Asset Retirement Obligations Brookfield DTLA has evaluated whether it has any conditional asset retirement obligations, which are a legal obligation to perform an asset retirement activity in which the timing and/or method of settlement are conditional upon future events that may or may not be within an entity’s control. The obligation to perform the asset retirement activity is unconditional even though uncertainty exists about the timing and/or method of settlement. Accordingly, Brookfield DTLA recognized a liability for a conditional asset retirement obligation. |
Intangible Assets and Liabili25
Intangible Assets and Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets and Liabilities | Brookfield DTLA’s intangible assets and liabilities are summarized as follows (in thousands): December 31, 2016 December 31, 2015 Intangible Assets In-place leases $ 110,519 $ 110,519 Tenant relationships 46,248 46,248 Above-market leases 39,936 39,936 196,703 196,703 Less: accumulated amortization 121,117 96,993 Intangible assets, net $ 75,586 $ 99,710 Intangible Liabilities Below-market leases $ 76,344 $ 76,344 Less: accumulated amortization 54,117 46,136 Intangible liabilities, net $ 22,227 $ 30,208 |
Schedule of Impact of Intangible Amortization Expense | The impact of the amortization of acquired below-market leases, net of acquired above-market leases, on rental income and of acquired in-place leases and tenant relationships on depreciation and amortization expense is as follows (in thousands): For the Year Ended December 31, 2016 2015 2014 Rental income $ 3,465 $ 2,559 $ 3,059 Depreciation and amortization expense 19,609 21,159 26,872 |
Schedule of Estimated Future Amortization/Accretion of Intangible Assets and Liabilities | As of December 31, 2016 , the estimate of the amortization/accretion of intangible assets and liabilities during the next five years and thereafter is as follows (in thousands): In-Place Leases Other Intangible Assets Intangible Liabilities 2017 $ 10,477 $ 6,324 $ 5,656 2018 6,754 5,146 3,812 2019 5,704 4,313 3,238 2020 5,059 3,417 3,031 2021 4,821 3,381 2,906 Thereafter 9,619 10,571 3,584 $ 42,434 $ 33,152 $ 22,227 |
Mortgage Loans (Tables)
Mortgage Loans (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Brookfield DTLA’s debt is as follows (in thousands, except percentage amounts): Contractual Maturity Date Principal Amount as of Interest Rate December 31, 2016 December 31, 2015 Floating-Rate Debt Variable-Rate Loans: Wells Fargo Center–South Tower (1) 12/6/2018 4.34 % $ 250,000 $ — 777 Tower (2) 11/1/2018 2.80 % 220,000 200,000 Figueroa at 7th (3) 9/10/2017 2.91 % 35,000 35,000 Total variable-rate loans 505,000 235,000 Variable-Rate Swapped to Fixed-Rate Loan: EY Plaza (4) 11/27/2020 3.93 % 180,859 184,377 Total floating-rate debt 685,859 419,377 Fixed-Rate Debt: Wells Fargo Center–North Tower 4/6/2017 5.70 % 550,000 550,000 BOA Plaza 9/1/2024 4.05 % 400,000 400,000 Gas Company Tower 8/6/2021 3.47 % 319,000 — Gas Company Tower 8/6/2021 6.50 % 131,000 — Total fixed-rate debt 1,400,000 950,000 Debt Refinanced: Gas Company Tower — 458,000 Wells Fargo Center–South Tower — 290,000 Total debt refinanced — 748,000 Total debt 2,085,859 2,117,377 Less: unamortized discounts and debt issuance costs 9,055 5,972 Total debt, net $ 2,076,804 $ 2,111,405 __________ (1) This loan bears interest at LIBOR plus 3.69% . As required by the loan agreement, we have entered into an interest rate cap agreement that limits the LIBOR portion of the interest rate to 3.00% . Brookfield DTLA has three options to extend the maturity date of the loan, each for a period of one year, subject to meeting certain debt yield and loan to value ratios (as specified in the loan agreement). (2) This loan bears interest at LIBOR plus 2.18% . As required by the loan agreement, we have entered into an interest rate cap agreement that limits the LIBOR portion of the interest rate to 5.75% . Brookfield DTLA has two options to extend the maturity date of the loan, each for a period of one year, subject to meeting certain debt yield and loan to value ratios (as specified in the loan agreement). (3) This loan bears interest at LIBOR plus 2.25% . Brookfield DTLA has two options to extend the maturity date of this loan, each for a period of 12 months, subject to meeting certain debt yield and loan to value ratios (as specified in the loan agreement). (4) This loan bears interest at LIBOR plus 1.75% . As required by the loan agreement, we have entered into an interest rate swap agreement to hedge this loan, which effectively fixes the LIBOR portion of the interest rate at 2.178% . The effective interest rate of 3.93% includes interest on the swap. |
Schedule of Debt Maturities | As of December 31, 2016 , our debt to be repaid during the next five years and thereafter is as follows (in thousands): 2017 $ 589,026 2018 474,233 2019 4,449 2020 168,151 2021 450,000 Thereafter 400,000 $ 2,085,859 |
Mezzanine Equity (Tables)
Mezzanine Equity (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Temporary Equity Disclosure [Abstract] | |
Summary of Change in Mezzanine Equity | A summary of the change in mezzanine equity is as follows (in thousands, except share amounts): Number of Shares of Series A Preferred Stock Series A Preferred Stock Noncontrolling Interests Total Mezzanine Equity Series A-1 Preferred Interest Senior Participating Preferred Interest Series B Preferred Interest Balance, December 31, 2013 9,730,370 $ 339,101 $ 314,658 $ 257,780 $ — $ 911,539 Current dividends 18,548 17,213 10,044 45,805 Redemption measurement adjustment 2,256 2,256 Cash distributions (220,000 ) (220,000 ) Balance, December 31, 2014 9,730,370 357,649 331,871 50,080 — 739,600 Current dividends 18,548 17,213 2,321 38,082 Redemption measurement adjustment 6,626 6,626 Dividends declared (21,893 ) (21,893 ) Cash distributions (35,820 ) (35,820 ) Balance, December 31, 2015 9,730,370 354,304 349,084 23,207 — 726,595 Issuance of Series B preferred interest 63,280 63,280 Current dividends 18,548 17,213 — 2,084 37,845 Cash distributions (616 ) (616 ) Redemption measurement adjustment 2,428 2,428 Balance, December 31, 2016 9,730,370 $ 372,852 $ 366,297 $ 25,019 $ 65,364 $ 829,532 |
Accumulated Other Comprehensi28
Accumulated Other Comprehensive (Loss) Income (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Summary of Change in Accumulated Other Comprehensive (Loss) Income Related to Cash Flow Hedges | A summary of the change in accumulated other comprehensive (loss) income related to Brookfield DTLA’s cash flow hedges is as follows (in thousands): For the Year Ended December 31, 2016 2015 2014 Balance at beginning of year $ (5,415 ) $ (4,337 ) $ 1,007 Other comprehensive income (loss) before reclassifications 2,042 (1,078 ) (5,344 ) Amounts reclassified from accumulated other — — — Net current-year other comprehensive income (loss) 2,042 (1,078 ) (5,344 ) Balance at end of year $ (3,373 ) $ (5,415 ) $ (4,337 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Summary of (Liabilities) Assets Measured at Fair Value on a Recurring Basis | Brookfield DTLA’s (liabilities) assets measured at fair value on a recurring basis, aggregated by the level in the fair value hierarchy within which those measurements fall, are as follows (in thousands): Fair Value Measurements Using Total Fair Value Quoted Prices in Active Markets for Identical (Liabilities) Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Interest rate swap at: December 31, 2016 $ (3,373 ) $ — $ (3,373 ) $ — December 31, 2015 (5,415 ) — (5,415 ) — December 31, 2014 (4,337 ) — (4,337 ) — Interest rate caps at: December 31, 2016 $ 53 $ — $ 53 $ — December 31, 2015 19 — 19 — December 31, 2014 190 — 190 — |
Financial Instruments (Tables)
Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Summary of Fair Value of Derivative Instruments | A summary of the fair value of Brookfield DTLA’s derivative financial instruments is as follows (in thousands): Fair Value as of December 31, 2016 December 31, 2015 Derivatives designated as cash flow hedging instruments: Interest rate swap $ (3,373 ) $ (5,415 ) |
Summary of Effect of Derivative Financial Instruments | A summary of the effect of derivative financial instruments reported in the consolidated financial statements is as follows (in thousands): Amount of Gain (Loss) Recognized in AOCL Amount of Gain (Loss) Reclassified from AOCL to Statement of Operations Derivatives designated as cash flow hedging instruments: Interest rate swap for the year ended: December 31, 2016 $ 2,042 $ — December 31, 2015 (1,078 ) — December 31, 2014 (5,344 ) — |
Schedule of Notional Amounts of Interest Rate Caps | Brookfield DTLA holds interest rate caps pursuant to the terms of certain of its mortgage loan agreements with the following notional amounts (in thousands): December 31, 2016 December 31, 2015 Wells Fargo Center–South Tower $ 270,000 $ 290,000 777 Tower 220,000 200,000 $ 490,000 $ 490,000 |
Summary of Estimated Fair Value and Carrying Amount of Mortgage Loans | The estimated fair value and carrying amount of Brookfield DTLA’s mortgage loans are as follows (in thousands): December 31, 2016 December 31, 2015 Estimated fair value $ 2,059,449 $ 2,114,761 Carrying amount 2,085,859 2,117,377 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Summary of Costs Incurred Under Agreements with Related Parties | A summary of costs incurred by Brookfield DTLA under these arrangements, which are included in rental property operating and maintenance expense in the consolidated statement of operations, is as follows (in thousands): For the Year Ended December 31, 2016 2015 2014 Property management fee expense $ 7,964 $ 7,445 $ 8,135 Asset management fee expense 6,330 6,292 6,109 General, administrative and reimbursable expenses 2,466 2,593 2,509 Leasing and construction management fees 3,049 6,396 3,626 A summary of costs incurred by Brookfield DTLA under this arrangement, which are included in rental property operating and maintenance expense in the consolidated statement of operations, is as follows (in thousands): For the Year Ended December 31, 2016 2015 2014 Insurance expense $ 7,948 $ 8,532 $ 8,466 |
Rental Income (Tables)
Rental Income (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Leases [Abstract] | |
Schedule of Future Minimum Rental Income Under Noncancelable Tenant Operating Leases | The future minimum base rental income (on a non-straight-line basis) to be received under noncancelable tenant operating leases in effect as of December 31, 2016 is as follows (in thousands): 2017 $ 155,308 2018 149,122 2019 147,556 2020 139,895 2021 135,787 Thereafter 564,642 $ 1,292,310 |
Quarterly Financial Informati33
Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information (Unaudited) | First Quarter Second Quarter Third Quarter Fourth Quarter (In thousands) Year Ended December 31, 2016 Revenue $ 74,813 $ 78,968 $ 77,408 $ 79,503 Expenses 84,785 87,230 86,802 90,042 Net loss (9,972 ) (8,262 ) (9,394 ) (10,539 ) Net loss attributable to noncontrolling interests: Series A-1 preferred interest – current dividends 4,303 4,303 4,303 4,304 Senior participating preferred interest – current dividends — — — — Senior participating preferred interest – redemption measurement adjustment 656 400 908 464 Series B preferred interest – current dividends — 68 881 1,135 Series B common interest – allocation of net loss (10,242 ) (9,248 ) (10,532 ) (11,033 ) Net loss attributable to Brookfield DTLA (4,689 ) (3,785 ) (4,954 ) (5,409 ) Series A preferred stock – current dividends 4,637 4,637 4,637 4,637 Net loss available to common interest holders of Brookfield DTLA $ (9,326 ) $ (8,422 ) $ (9,591 ) $ (10,046 ) Year Ended December 31, 2015 Revenue $ 73,508 $ 77,438 $ 74,561 $ 73,583 Expenses 82,569 84,166 83,908 88,801 Net loss (9,061 ) (6,728 ) (9,347 ) (15,218 ) Net loss attributable to noncontrolling interests: Series A-1 preferred interest – current dividends 4,303 4,303 4,303 4,304 Senior participating preferred interest – current dividends 587 597 608 529 Senior participating preferred interest – redemption measurement adjustment 760 1,540 804 3,521 Series B preferred interest – current dividends — — — — Series B common interest – allocation of net loss (10,127 ) (9,319 ) (10,310 ) (14,765 ) Net loss attributable to Brookfield DTLA (4,584 ) (3,849 ) (4,752 ) (8,807 ) Series A preferred stock – current dividends 4,637 4,637 4,637 4,637 Net loss available to common interest holders of Brookfield DTLA $ (9,221 ) $ (8,486 ) $ (9,389 ) $ (13,444 ) |
Investments in Real Estate (Tab
Investments in Real Estate (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Schedule of Real Estate Properties | A summary of information related to Brookfield DTLA’s investments in real estate as of December 31, 2016 is as follows (in thousands): Encum- brances Initial Cost to Company Costs Capitalized Subsequent to Acquisition Gross Amount at Which Carried at Close of Period Accum- ulated Depre- ciation (2) Year Acquired Land Buildings and Improve- ments Improve- ments Carrying Costs Land Buildings and Improve- ments Total (1) Los Angeles, CA Wells Fargo Center– North Tower 333 S. Grand Avenue $ 550,000 $ 41,024 $ 456,363 $ 57,660 $ — $ 41,024 $ 514,023 $ 555,047 $ 49,817 2013 BOA Plaza 400,000 54,163 354,422 50,057 — 54,163 404,479 458,642 94,712 2006 Wells Fargo Center– South Tower 355 S. Grand Avenue 250,000 21,231 401,149 17,633 — 21,231 418,782 440,013 35,318 2013 Gas Company 450,000 20,742 396,159 53,569 — 20,742 449,728 470,470 30,797 2013 EY Plaza (3) 725 S. Figueroa 215,859 47,385 286,982 117,372 — 47,385 404,354 451,739 86,133 2006 777 Tower 777 S. Figueroa 220,000 38,010 303,697 17,798 — 38,010 321,495 359,505 32,372 2013 Miscellaneous — 5,000 — 357 — 5,000 357 5,357 — $ 2,085,859 $ 227,555 $ 2,198,772 $ 314,446 $ — $ 227,555 $ 2,513,218 $ 2,740,773 $ 329,149 __________ (1) The aggregate gross cost of Brookfield DTLA’s investments in real estate for federal income tax purposes approximated $2.7 billion as of December 31, 2016 . (2) Depreciation in the consolidated statements of operations is computed on a straight-line basis over the following estimated useful lives: buildings ( 60 years, with an estimated salvage value of 5% ), building improvements (ranging from 7 years to 25 years), and tenant improvements (the shorter of the useful life or the applicable lease term). (3) Includes the mortgage loan encumbering the Figueroa at 7th retail property. |
Investments in Real Estate | The following is a reconciliation of Brookfield DTLA’s investments in real estate (in thousands): For the Year Ended December 31, 2016 2015 2014 Investments in Real Estate Balance at beginning of year $ 2,675,249 $ 2,619,422 $ 2,557,865 Additions during the year: Acquisitions — — — Improvements 65,524 57,827 61,557 Deductions during the year: Dispositions — 2,000 — Other — — — Balance at end of year $ 2,740,773 $ 2,675,249 $ 2,619,422 |
Accumulated Depreciation | The following is a reconciliation of Brookfield DTLA’s accumulated depreciation on its investments in real estate (in thousands): For the Year Ended December 31, 2016 2015 2014 Accumulated Depreciation Balance at beginning of year $ 256,130 $ 189,108 $ 121,612 Additions during the year: Depreciation expense 73,019 67,022 67,496 Deductions during the year: Other — — — Balance at end of year $ 329,149 $ 256,130 $ 189,108 |
Organization and Description 35
Organization and Description of Business - Narrative (Details) | Oct. 15, 2013 | Dec. 31, 2016 | Dec. 31, 2015 |
Series A preferred stock | |||
Organization and Description of Business [Line Items] | |||
Preferred stock, dividend rate, percentage | 7.625% | 7.625% | 7.625% |
Basis of Presentation and Sum36
Basis of Presentation and Summary of Significant Accounting Policies - Accounting Policies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||
Distributions to Brookfield DTLA Holdings | $ 220,000 | ||
Distributions to senior participating preferred interest | $ 616 | $ 32,769 | 207,231 |
Dividends paid to senior participating preferred interest | 0 | 3,051 | 12,769 |
Depreciation | 73,000 | 67,000 | 67,500 |
Impairment of real estate assets | 0 | 0 | |
Tenant inducements, accumulated amortization | 9,900 | 6,500 | |
Allowance for doubtful accounts | 200 | 500 | |
(Recovery of) provision for doubtful accounts | (271) | 103 | 24 |
Deferred leasing costs, accumulated amortization | 49,600 | 38,200 | |
Unamortized discounts and debt issuance costs | 9,055 | 5,972 | |
Amortization of discounts and deferred financing costs | 4,329 | 5,064 | 6,049 |
Provision for income taxes | 0 | 0 | $ 0 |
Unrecognized tax benefits | $ 0 | $ 0 | |
Building | |||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||
Useful life | 60 years | ||
Estimated salvage value | 5.00% | ||
Building Improvements | Minimum | |||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||
Useful life | 7 years | ||
Building Improvements | Maximum | |||
Basis of Presentation and Summary of Significant Accounting Policies [Line Items] | |||
Useful life | 25 years |
Basis of Presentation and Sum37
Basis of Presentation and Summary of Significant Accounting Policies - New Accounting Pronouncements (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Amortization of discounts and deferred financing costs | $ 4,329 | $ 5,064 | $ 6,049 |
Accounting Standards Update 2015-03 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Amortization of deferred financing costs | 1,007 | ||
Amortization of debt discount | 5,042 | ||
Amortization of discounts and deferred financing costs | $ 6,049 |
Intangible Assets and Liabili38
Intangible Assets and Liabilities - Summary of Intangible Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Intangible Assets | ||
In-place leases | $ 110,519 | $ 110,519 |
Tenant relationships | 46,248 | 46,248 |
Above-market leases | 39,936 | 39,936 |
Intangible assets, gross | 196,703 | 196,703 |
Less: accumulated amortization | 121,117 | 96,993 |
Intangible assets, net | 75,586 | 99,710 |
Intangible Liabilities | ||
Below-market leases | 76,344 | 76,344 |
Less: accumulated amortization | 54,117 | 46,136 |
Intangible liabilities, net | $ 22,227 | $ 30,208 |
Intangible Assets and Liabili39
Intangible Assets and Liabilities - Schedule of Impact of Intangible Amortization Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Rental income | |||
Acquired Indefinite-lived Intangible Assets and Liabilities [Line Items] | |||
Amortization of intangible assets and liabilities | $ 3,465 | $ 2,559 | $ 3,059 |
Depreciation and amortization expense | |||
Acquired Indefinite-lived Intangible Assets and Liabilities [Line Items] | |||
Amortization of intangible assets and liabilities | $ 19,609 | $ 21,159 | $ 26,872 |
Intangible Assets and Liabili40
Intangible Assets and Liabilities - Schedule of Estimated Future Amortization/Accretion of Intangible Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
Intangible assets, net | $ 75,586 | $ 99,710 |
Below Market Lease, Net, Amortization Income, Fiscal Year Maturity [Abstract] | ||
2,017 | 5,656 | |
2,018 | 3,812 | |
2,019 | 3,238 | |
2,020 | 3,031 | |
2,021 | 2,906 | |
Thereafter | 3,584 | |
Intangible liabilities, net | 22,227 | $ 30,208 |
In-Place Leases | ||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2,017 | 10,477 | |
2,018 | 6,754 | |
2,019 | 5,704 | |
2,020 | 5,059 | |
2,021 | 4,821 | |
Thereafter | 9,619 | |
Intangible assets, net | 42,434 | |
Other Intangible Assets | ||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2,017 | 6,324 | |
2,018 | 5,146 | |
2,019 | 4,313 | |
2,020 | 3,417 | |
2,021 | 3,381 | |
Thereafter | 10,571 | |
Intangible assets, net | $ 33,152 |
Mortgage Loans - Schedule of De
Mortgage Loans - Schedule of Debt (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Jul. 11, 2016 | Dec. 31, 2015 | |
Debt Instrument [Line Items] | |||
Total debt, gross | $ 2,085,859 | $ 2,117,377 | |
Less: unamortized discounts and debt issuance costs | 9,055 | 5,972 | |
Total debt, net | 2,076,804 | 2,111,405 | |
Variable Rate Loans | |||
Debt Instrument [Line Items] | |||
Total debt, gross | $ 505,000 | 235,000 | |
Variable Rate Loans | Wells Fargo Center - South Tower | |||
Debt Instrument [Line Items] | |||
Contractual maturity date | Dec. 6, 2018 | ||
Variable interest rate | 4.34% | ||
Total debt, gross | $ 250,000 | 0 | |
Variable Rate Loans | 777 Tower | |||
Debt Instrument [Line Items] | |||
Contractual maturity date | Nov. 1, 2018 | ||
Variable interest rate | 2.80% | ||
Total debt, gross | $ 220,000 | 200,000 | |
Variable Rate Loans | Figueroa at 7th | |||
Debt Instrument [Line Items] | |||
Contractual maturity date | Sep. 10, 2017 | ||
Variable interest rate | 2.9138% | ||
Total debt, gross | $ 35,000 | 35,000 | |
Floating Rate Debt | |||
Debt Instrument [Line Items] | |||
Total debt, gross | $ 685,859 | 419,377 | |
Floating Rate Debt | EY Plaza | |||
Debt Instrument [Line Items] | |||
Contractual maturity date | Nov. 27, 2020 | ||
Variable interest rate | 3.928% | ||
Total debt, gross | $ 180,859 | 184,377 | |
Fixed Rate Debt | |||
Debt Instrument [Line Items] | |||
Total debt, gross | $ 1,400,000 | 950,000 | |
Fixed Rate Debt | Wells Fargo Center - North Tower | |||
Debt Instrument [Line Items] | |||
Contractual maturity date | Apr. 6, 2017 | ||
Fixed interest rate | 5.697% | ||
Total debt, gross | $ 550,000 | 550,000 | |
Fixed Rate Debt | Bank of America Plaza | |||
Debt Instrument [Line Items] | |||
Contractual maturity date | Sep. 1, 2024 | ||
Fixed interest rate | 4.05% | ||
Total debt, gross | $ 400,000 | 400,000 | |
Fixed Rate Debt - Senior Loan | Gas Company Tower | |||
Debt Instrument [Line Items] | |||
Contractual maturity date | Aug. 6, 2021 | ||
Fixed interest rate | 3.4727% | 3.4727% | |
Total debt, gross | $ 319,000 | 0 | |
Fixed Rate Debt - Mezzanine Loan | Gas Company Tower | |||
Debt Instrument [Line Items] | |||
Contractual maturity date | Aug. 6, 2021 | ||
Fixed interest rate | 6.50% | 6.50% | |
Total debt, gross | $ 131,000 | 0 | |
Debt Refinanced | |||
Debt Instrument [Line Items] | |||
Total debt, gross | 0 | 748,000 | |
Debt Refinanced | Wells Fargo Center - South Tower | |||
Debt Instrument [Line Items] | |||
Total debt, gross | 0 | 290,000 | |
Debt Refinanced | Gas Company Tower | |||
Debt Instrument [Line Items] | |||
Total debt, gross | $ 0 | $ 458,000 |
Mortgage Loans - Schedule of 42
Mortgage Loans - Schedule of Debt (Footnote) (Details) - extension_option | Sep. 01, 2016 | Dec. 31, 2016 |
Variable Rate Loans | Wells Fargo Center - South Tower | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 4.34% | |
Variable Rate Loans | Wells Fargo Center - South Tower | LIBOR | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 3.69% | |
Cap interest rate | 3.00% | |
Number of options to extend | 3 | |
Option extension period | 1 year | |
Variable Rate Loans | 777 Tower | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 2.80% | |
Variable Rate Loans | 777 Tower | LIBOR | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 2.18% | 2.18% |
Cap interest rate | 5.75% | |
Number of options to extend | 2 | |
Option extension period | 1 year | |
Variable Rate Loans | Figueroa at 7th | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 2.9138% | |
Variable Rate Loans | Figueroa at 7th | LIBOR | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 2.25% | |
Number of options to extend | 2 | |
Option extension period | 12 months | |
Floating Rate Debt | EY Plaza | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 3.928% | |
Floating Rate Debt | EY Plaza | LIBOR | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 1.75% | |
Swap rate | 2.178% |
Mortgage Loans - Narrative (Det
Mortgage Loans - Narrative (Details) $ in Thousands | Dec. 02, 2016USD ($) | Nov. 30, 2016USD ($) | Sep. 01, 2016USD ($) | Jul. 13, 2016USD ($) | Jul. 13, 2016USD ($) | Jul. 11, 2016USD ($) | May 16, 2016USD ($) | Dec. 31, 2016USD ($)extension_option | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) |
Debt Instrument [Line Items] | ||||||||||
Weighted average interest rate | 4.42% | 4.20% | ||||||||
Prepayment amount without penalty | $ 765,900 | |||||||||
Amount available to be defeased | 400,000 | |||||||||
Prepaid with penalties | 470,000 | |||||||||
Locked out from prepayment until September 6, 2017 | 450,000 | |||||||||
Total debt, gross | 2,085,859 | $ 2,117,377 | ||||||||
Proceeds from mortgage loans | $ 720,000 | 0 | $ 435,000 | |||||||
Covenant compliance | Pursuant to the terms of certain of our mortgage loan agreements, Brookfield DTLA is required to report a debt service coverage ratio (“DSCR”) calculated using the formulas specified in the underlying loan agreements. We have submitted the required reports to the lenders for the measurement periods ended December 31, 2016 and were in compliance with the amounts required by the loan agreements. | |||||||||
Issuance of Series B preferred interest | $ 63,280 | |||||||||
Carrying amount | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Total debt, gross | 2,085,859 | 2,117,377 | ||||||||
Series B preferred interest | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Issuance of Series B preferred interest | $ 20,300 | $ 7,000 | $ 37,000 | $ 30,000 | $ 6,000 | 63,280 | ||||
Variable Rate Loans | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Total debt, gross | 505,000 | 235,000 | ||||||||
Fixed Rate Debt | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Total debt, gross | 1,400,000 | 950,000 | ||||||||
Gas Company Tower | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Face amount | 450,000 | |||||||||
Gas Company Tower | Fixed Rate Debt | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt refinanced or to be refinanced | 458,000 | |||||||||
Additional cash required to refinance debt | 19,700 | |||||||||
Repayments of long term debt | 8,000 | |||||||||
Gas Company Tower | Fixed Rate Debt - Senior Loan | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Total debt, gross | $ 319,000 | 0 | ||||||||
Maturity date | Aug. 6, 2021 | |||||||||
Face amount | $ 319,000 | |||||||||
Fixed interest rate | 3.4727% | 3.4727% | ||||||||
Tenant improvement and leasing commission reserve | $ 20,700 | |||||||||
Rent concession reserve | 4,500 | |||||||||
Property tax reserve | 3,000 | |||||||||
Gas Company Tower | Fixed Rate Debt - Mezzanine Loan | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Total debt, gross | $ 131,000 | 0 | ||||||||
Maturity date | Aug. 6, 2021 | |||||||||
Face amount | $ 131,000 | |||||||||
Fixed interest rate | 6.50% | 6.50% | ||||||||
Wells Fargo Center - South Tower | Variable Rate Loans | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt refinanced or to be refinanced | $ 290,000 | |||||||||
Total debt, gross | $ 250,000 | 0 | ||||||||
Maturity date | Dec. 6, 2018 | |||||||||
Face amount | 250,000 | |||||||||
Repayments of long term debt | 40,000 | |||||||||
Tenant improvement and leasing commission reserve | 6,100 | |||||||||
Property tax reserve | 1,100 | |||||||||
Maximum loan amount per loan agreement | $ 270,000 | |||||||||
Remaining future advance amount | $ 20,000 | |||||||||
Wells Fargo Center - South Tower | Variable Rate Loans | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate | 3.69% | |||||||||
Number of options to extend | extension_option | 3 | |||||||||
Extension term of maturity date on loan | 1 year | |||||||||
777 Tower | Variable Rate Loans | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt refinanced or to be refinanced | $ 200,000 | |||||||||
Total debt, gross | $ 220,000 | 200,000 | ||||||||
Maturity date | Nov. 1, 2018 | |||||||||
Face amount | 220,000 | |||||||||
Proceeds from mortgage loans | $ 19,700 | |||||||||
777 Tower | Variable Rate Loans | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate | 2.18% | 2.18% | ||||||||
Number of options to extend | extension_option | 2 | |||||||||
Extension term of maturity date on loan | 1 year | |||||||||
Figueroa at 7th | Variable Rate Loans | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt refinanced or to be refinanced | $ 35,000 | |||||||||
Total debt, gross | $ 35,000 | 35,000 | ||||||||
Maturity date | Sep. 10, 2017 | |||||||||
Figueroa at 7th | Variable Rate Loans | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Basis spread on variable rate | 2.25% | |||||||||
Number of options to extend | extension_option | 2 | |||||||||
Extension term of maturity date on loan | 12 months | |||||||||
Bank of America Plaza | Fixed Rate Debt | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Total debt, gross | $ 400,000 | 400,000 | ||||||||
Maturity date | Sep. 1, 2024 | |||||||||
Fixed interest rate | 4.05% | |||||||||
Wells Fargo Center - North Tower | Fixed Rate Debt | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt refinanced or to be refinanced | $ 550,000 | |||||||||
Total debt, gross | $ 550,000 | 550,000 | ||||||||
Maturity date | Apr. 6, 2017 | |||||||||
Additional cash required to refinance debt | $ 90,000 | |||||||||
Fixed interest rate | 5.697% | |||||||||
Wells Fargo Center - North Tower | Fixed Rate Debt | Restricted Cash | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Collateral reserve paid to lender | 2,500 | $ 2,500 | ||||||||
Wells Fargo Center - North Tower and Gas Company Tower | Fixed Rate Debt | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Amount subject to guarantees | $ 0 | $ 591,800 |
Mortgage Loans - Schedule of 44
Mortgage Loans - Schedule of Debt Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Debt Disclosure [Abstract] | ||
2,017 | $ 589,026 | |
2,018 | 474,233 | |
2,019 | 4,449 | |
2,020 | 168,151 | |
2,021 | 450,000 | |
Thereafter | 400,000 | |
Total | $ 2,085,859 | $ 2,117,377 |
Mezzanine Equity - Narrative (D
Mezzanine Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 28, 2017 | Nov. 30, 2016 | Jul. 13, 2016 | Jul. 13, 2016 | Jul. 11, 2016 | May 16, 2016 | Apr. 05, 2016 | Jan. 04, 2016 | Dec. 16, 2015 | Dec. 04, 2015 | Aug. 28, 2014 | Mar. 21, 2014 | Oct. 15, 2013 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2013 |
Class of Stock [Line Items] | ||||||||||||||||||
Redemption value | $ 829,532 | $ 726,595 | $ 739,600 | $ 829,532 | $ 911,539 | |||||||||||||
Payments of dividends to noncontrolling interest | 0 | 3,051 | 12,769 | |||||||||||||||
Other payment to noncontrolling interest | 616 | 32,769 | 207,231 | |||||||||||||||
Issuance of Series B preferred interest | 63,280 | |||||||||||||||||
Accumulated and unpaid dividends | $ 0 | $ 21,893 | $ 0 | $ 0 | ||||||||||||||
Series A-1 Preferred Interest | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Preferred interest percent distribution | 48.13% | |||||||||||||||||
Series A Preferred Interest | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Preferred interest percent distribution | 51.87% | |||||||||||||||||
Preferred interest percent distribution after liquidation preference reduced to zero | 47.66% | |||||||||||||||||
Series B preferred interest | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Preferred interest percent distribution after liquidation preference reduced to zero | 52.34% | |||||||||||||||||
Series A preferred stock | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Preferred stock dividends paid (in USD per share) | $ 2.25 | |||||||||||||||||
Dividend payment | $ 21,900 | |||||||||||||||||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | ||||||||||||||||
Preferred stock, par value (in USD per share) | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||||||||
Preferred stock, redemption price per share (in USD per share) | $ 25 | $ 25 | ||||||||||||||||
Preferred stock, shares outstanding (in shares) | 9,730,370 | 9,730,370 | 9,730,370 | |||||||||||||||
Preferred stock dividends declared (in USD per share) | $ 2.25 | $ 0 | $ 0 | |||||||||||||||
Preferred stock, dividend rate (in USD per share) | $ 1.90625 | |||||||||||||||||
Preferred stock, amount of preferred dividends in arrears | $ 129,600 | |||||||||||||||||
Redemption value | $ 372,852 | $ 354,304 | $ 357,649 | $ 372,852 | 339,101 | |||||||||||||
Series A preferred stock | Third Party Issuance | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Preferred stock, shares outstanding (in shares) | 9,357,469 | 9,357,469 | 9,357,469 | |||||||||||||||
Series A preferred stock | Brookfield DTLA Holdings LLC | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Preferred stock, shares outstanding (in shares) | 372,901 | 372,901 | 372,901 | |||||||||||||||
Series A-1 Preferred Interest | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Preferred stock, amount of preferred dividends in arrears | $ 140,600 | |||||||||||||||||
Redemption value | $ 366,297 | $ 349,084 | 331,871 | 366,297 | 314,658 | |||||||||||||
Temporary equity, stated value | $ 225,700 | |||||||||||||||||
Liquidation value | 225,700 | 225,700 | ||||||||||||||||
Senior Participating Preferred Interest | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Distributions to noncontrolling interests | $ 35,800 | $ 150,000 | $ 70,000 | 600 | 35,800 | 220,000 | ||||||||||||
Redemption value | 25,019 | 23,207 | 50,080 | 25,019 | 257,780 | |||||||||||||
Temporary equity, stated value | $ 240,000 | |||||||||||||||||
Coupon rate, preferred interest | 7.00% | |||||||||||||||||
Payments of dividends to noncontrolling interest | 3,000 | 5,500 | 7,300 | |||||||||||||||
Other payment to noncontrolling interest | $ 300 | $ 300 | $ 32,800 | $ 144,500 | $ 62,700 | |||||||||||||
Series B preferred interest | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Redemption value | 65,364 | $ 0 | $ 0 | 65,364 | $ 0 | |||||||||||||
Liquidation value | 63,300 | 63,300 | ||||||||||||||||
Coupon rate, preferred interest | 9.00% | 9.00% | 9.00% | |||||||||||||||
Maximum funding commitment | 260,000 | 260,000 | ||||||||||||||||
Issuance of Series B preferred interest | $ 20,300 | $ 7,000 | $ 37,000 | $ 30,000 | $ 6,000 | 63,280 | ||||||||||||
Accumulated and unpaid dividends | $ 2,100 | $ 2,100 | ||||||||||||||||
Fixed Rate Debt | Gas Company Tower | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Cash required to refinance debt | $ 19,700 | |||||||||||||||||
333 South Hope and EYP Realty | Senior Participating Preferred Interest | Brookfield DTLA Holdings LLC | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Participating interest in residual value | 4.00% | |||||||||||||||||
Subsequent Event | Series B preferred interest | ||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||
Coupon rate, preferred interest | 9.00% | |||||||||||||||||
Issuance of Series B preferred interest | $ 30,000 |
Mezzanine Equity - Summary of C
Mezzanine Equity - Summary of Change in Mezzanine Equity (Details) - USD ($) $ in Thousands | Nov. 30, 2016 | Jul. 13, 2016 | Jul. 13, 2016 | Jul. 11, 2016 | May 16, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||
Balance, beginning | $ 726,595 | $ 739,600 | $ 911,539 | |||||
Issuance of Series B preferred interest | 63,280 | |||||||
Current dividends | 37,845 | 38,082 | 45,805 | |||||
Redemption measurement adjustment | 2,428 | 6,626 | 2,256 | |||||
Dividends declared | (21,893) | |||||||
Cash distributions | (616) | (35,820) | (220,000) | |||||
Balance, ending | 829,532 | 726,595 | 739,600 | |||||
Series A Preferred Stock | ||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||
Balance, beginning | $ 354,304 | $ 357,649 | $ 339,101 | |||||
Balance, beginning (in shares) | 9,730,370 | 9,730,370 | 9,730,370 | |||||
Current dividends | $ 18,548 | $ 18,548 | $ 18,548 | |||||
Dividends declared | (21,893) | |||||||
Balance, ending | $ 372,852 | $ 354,304 | $ 357,649 | |||||
Balance, ending (in shares) | 9,730,370 | 9,730,370 | 9,730,370 | |||||
Series A-1 Preferred Interest | ||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||
Balance, beginning | $ 349,084 | $ 331,871 | $ 314,658 | |||||
Current dividends | 17,213 | 17,213 | 17,213 | |||||
Balance, ending | 366,297 | 349,084 | 331,871 | |||||
Senior Participating Preferred Interest | ||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||
Balance, beginning | 23,207 | 50,080 | 257,780 | |||||
Current dividends | 0 | 2,321 | 10,044 | |||||
Redemption measurement adjustment | 2,428 | 6,626 | 2,256 | |||||
Cash distributions | (616) | (35,820) | (220,000) | |||||
Balance, ending | 25,019 | 23,207 | 50,080 | |||||
Series B Preferred Interest | ||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||
Balance, beginning | 0 | 0 | 0 | |||||
Issuance of Series B preferred interest | $ 20,300 | $ 7,000 | $ 37,000 | $ 30,000 | $ 6,000 | 63,280 | ||
Current dividends | 2,084 | |||||||
Balance, ending | $ 65,364 | $ 0 | $ 0 |
Stockholders' Deficit - Narrati
Stockholders' Deficit - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Class of Stock [Line Items] | |||
Common stock, shares authorized (in shares) | 1,000,000 | 1,000,000 | |
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 | |
Common stock, shares issued (in shares) | 1,000 | 1,000 | |
Common stock, shares outstanding (in shares) | 1,000 | 1,000 | |
Dividends declared on common stock (in USD per share) | $ 0 | $ 0 | $ 0 |
Contribution from Brookfield DTLA Holdings | $ 2,500 | $ 0 | $ 0 |
Brookfield DTLA Holdings LLC | |||
Class of Stock [Line Items] | |||
Common stock, shares issued (in shares) | 1,000 | 1,000 | |
Common stock, shares outstanding (in shares) | 1,000 | 1,000 |
Accumulated Other Comprehensi48
Accumulated Other Comprehensive (Loss) Income - Summary of Change in Accumulated Other Comprehensive (Loss) Income Related to Cash Flow Hedges (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||
Balance at beginning of year | $ (2,580) | ||
Balance at end of year | (1,607) | $ (2,580) | |
Accumulated Other Comprehensive (Loss) Income | |||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||
Balance at beginning of year | (5,415) | (4,337) | $ 1,007 |
Other comprehensive income (loss) before reclassifications | 2,042 | (1,078) | (5,344) |
Amounts reclassified from accumulated other comprehensive (loss) income | 0 | 0 | 0 |
Net current-year other comprehensive income (loss) | 2,042 | (1,078) | (5,344) |
Balance at end of year | $ (3,373) | $ (5,415) | $ (4,337) |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of (Liabilities) Assets Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Interest Rate Swap | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate cash flow hedge derivative at fair value, net | $ (3,373) | $ (5,415) | $ (4,337) |
Interest Rate Swap | Quoted Prices in Active Markets for Identical (Liabilities) Assets (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate cash flow hedge derivative at fair value, net | 0 | 0 | 0 |
Interest Rate Swap | Significant Other Observable Inputs (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate cash flow hedge derivative at fair value, net | (3,373) | (5,415) | (4,337) |
Interest Rate Swap | Significant Unobservable Inputs (Level 3) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate cash flow hedge derivative at fair value, net | 0 | 0 | 0 |
Interest Rate Cap | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate derivative instruments not designated as hedging instruments, asset at fair value | 53 | 19 | 190 |
Interest Rate Cap | Quoted Prices in Active Markets for Identical (Liabilities) Assets (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate derivative instruments not designated as hedging instruments, asset at fair value | 0 | 0 | 0 |
Interest Rate Cap | Significant Other Observable Inputs (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate derivative instruments not designated as hedging instruments, asset at fair value | 53 | 19 | 190 |
Interest Rate Cap | Significant Unobservable Inputs (Level 3) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate derivative instruments not designated as hedging instruments, asset at fair value | $ 0 | $ 0 | $ 0 |
Financial Instruments - Summary
Financial Instruments - Summary of Fair Value of Derivative Instruments (Details) - Interest Rate Swap - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Derivatives, Fair Value [Line Items] | |||
Interest rate cash flow hedge derivative at fair value, net | $ (3,373) | $ (5,415) | $ (4,337) |
Accounts Payable and Other Liabilities | Cash Flow Hedging | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Interest rate cash flow hedge derivative at fair value, net | $ (3,373) | $ (5,415) |
Financial Instruments - Summa51
Financial Instruments - Summary of Effect of Derivative Instruments (Details) - Interest Rate Swap - Cash Flow Hedging - Designated as Hedging Instrument - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Derivative [Line Items] | |||
Amount of Gain (Loss) Recognized in AOCL | $ 2,042 | $ (1,078) | $ (5,344) |
Amount of Gain (Loss) Reclassified from AOCL to Statement of Operations | $ 0 | $ 0 | $ 0 |
Financial Instruments - Narrati
Financial Instruments - Narrative (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
EY Plaza | Interest Rate Swap | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Notional amount | $ 185 | $ 185 |
Financial Instruments - Schedul
Financial Instruments - Schedule of Interest Rate Derivatives (Details) - Interest Rate Cap - Not Designated as Hedging Instrument - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 02, 2016 | Sep. 01, 2016 | Dec. 31, 2015 |
Derivative Instruments, Interest Rate Caps | ||||
Notional amount | $ 490,000 | $ 490,000 | ||
Wells Fargo Center - South Tower | ||||
Derivative Instruments, Interest Rate Caps | ||||
Notional amount | 270,000 | $ 270,000 | 290,000 | |
777 Tower | ||||
Derivative Instruments, Interest Rate Caps | ||||
Notional amount | $ 220,000 | $ 220,000 | $ 200,000 |
Financial Instruments - Summa54
Financial Instruments - Summary of Estimated Fair Value and Carrying Amount of Mortgage Loans (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mortgage loans | $ 2,085,859 | $ 2,117,377 |
Carrying amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mortgage loans | 2,085,859 | 2,117,377 |
Significant Unobservable Inputs (Level 3) | Estimated fair value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mortgage loans | $ 2,059,449 | $ 2,114,761 |
Related Party Transactions - Na
Related Party Transactions - Narrative (Details) - USD ($) $ in Millions | Sep. 12, 2014 | Apr. 18, 2014 | Oct. 11, 2013 | Dec. 31, 2016 | Dec. 31, 2014 |
Related Party Transaction [Line Items] | |||||
Property management fee, percent | 2.75% | ||||
Asset management fee, percent | 0.75% | ||||
Real estate insurance, all risk property and business interruption coverage per occurrence | $ 2,500 | ||||
Real estate insurance, earthquake, flood and weather catastrophe insurance aggregate limit | 370 | ||||
Real estate insurance, terrorism insurance coverage aggregate limit | $ 4,000 | ||||
MPG Properties | |||||
Related Party Transaction [Line Items] | |||||
Real estate insurance, terrorism insurance coverage aggregate limit | $ 1,250 | ||||
Real estate insurance, all risk property and business interruption insurance aggregate limit | 1,250 | ||||
Real estate Insurance, earthquake aggregate limit | $ 130 | ||||
Promissory Note to BOP Management, Inc. | BOP Management Inc. | |||||
Related Party Transaction [Line Items] | |||||
Promissory note | $ 25 | ||||
Interest rate | 3.25% | ||||
Interest expense, related party | $ 0.6 | ||||
Repayment of related party debt | $ 25.8 |
Related Party Transactions - Su
Related Party Transactions - Summary of Costs Incurred Under Agreements with Related Parties (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property management fee expense | |||
Related Party Transaction [Line Items] | |||
Related party transaction expenses | $ 7,964 | $ 7,445 | $ 8,135 |
Asset management fee expense | |||
Related Party Transaction [Line Items] | |||
Related party transaction expenses | 6,330 | 6,292 | 6,109 |
General, administrative and reimbursable expenses | |||
Related Party Transaction [Line Items] | |||
Related party transaction expenses | 2,466 | 2,593 | 2,509 |
Leasing and construction management fees | |||
Related Party Transaction [Line Items] | |||
Related party transaction expenses | 3,049 | 6,396 | 3,626 |
Insurance expense | |||
Related Party Transaction [Line Items] | |||
Related party transaction expenses | $ 7,948 | $ 8,532 | $ 8,466 |
Rental Income - Schedule of Fut
Rental Income - Schedule of Future Minimum Rental Income Under Noncancelable Tenant Operating Leases (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Leases [Abstract] | |
2,017 | $ 155,308 |
2,018 | 149,122 |
2,019 | 147,556 |
2,020 | 139,895 |
2,021 | 135,787 |
Thereafter | 564,642 |
Total | $ 1,292,310 |
Rental Income - Narrative (Deta
Rental Income - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Leases [Abstract] | |||
Percentage rental income earned | $ 2.8 | $ 2.8 | $ 1.4 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative - Tenant Concentration (Details) - Revenue | 12 Months Ended | ||
Dec. 31, 2016customerProperties | Dec. 31, 2015customerProperties | Dec. 31, 2014customerProperties | |
Customer concentration risk | |||
Concentration Risk [Line Items] | |||
Number of tenants | customer | 0 | 0 | 0 |
Customer concentration risk | EY Plaza, BOA Plaza, Wells Fargo Center–North Tower, Wells Fargo Center–South Tower, Gas Company Tower and 777 Tower | |||
Concentration Risk [Line Items] | |||
Number of properties | Properties | 6 | 6 | 6 |
Property concentration risk | EY Plaza, BOA Plaza, Wells Fargo Center–North Tower, Wells Fargo Center–South Tower, Gas Company Tower and 777 Tower | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 100.00% | 98.00% | 100.00% |
Commitments and Contingencies60
Commitments and Contingencies - Narrative - Litigation (Details) | Aug. 17, 2016USD ($) | Apr. 21, 2016USD ($) | Apr. 18, 2016USD ($) | Jan. 04, 2016USD ($) | Dec. 04, 2015$ / shares | Jun. 18, 2014USD ($) | Apr. 24, 2013lawsuit | Dec. 31, 2016$ / shares | Dec. 31, 2014$ / shares | Jul. 13, 2016USD ($) | Sep. 28, 2015USD ($) | Mar. 30, 2015$ / shares | Nov. 21, 2013USD ($) |
Putative Class Actions Filed Against Brookfield Office Properties, Inc. | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Number of claims filed | lawsuit | 7 | ||||||||||||
MPG common stock | MPG Office LLC | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Maximum stipulation of settlement | $ 475,000 | ||||||||||||
Payment for legal settlement | $ 475,000 | ||||||||||||
Common and Series A Preferred Stock | MPG Office LLC | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Insurance settlement receivable | $ 1,106,344 | ||||||||||||
Cash received from insurance settlement | $ 1,106,344 | ||||||||||||
Series A Preferred Stock | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Payment for legal settlement | $ 2,212,688 | ||||||||||||
Proposed litigation payment per preferred share of accumulated and unpaid dividends (in USD per share) | $ / shares | $ 2.25 | ||||||||||||
Proposed litigation settlement, attorneys' fees | $ 5,250,000 | ||||||||||||
Preferred stock dividends declared (in USD per share) | $ / shares | $ 2.25 | $ 0 | $ 0 | ||||||||||
Dividend payment | $ 21,900,000 | ||||||||||||
Attorneys' fees and expenses awarded | $ 2,212,688 |
Quarterly Financial Informati61
Quarterly Financial Information (Unaudited) - Schedule of Quarterly Financial Information (Unaudited) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Quarterly Financial Information [Line Items] | |||||||||||
Revenue | $ 79,503 | $ 77,408 | $ 78,968 | $ 74,813 | $ 73,583 | $ 74,561 | $ 77,438 | $ 73,508 | $ 310,692 | $ 299,090 | $ 294,161 |
Expenses | 90,042 | 86,802 | 87,230 | 84,785 | 88,801 | 83,908 | 84,166 | 82,569 | 348,859 | 339,444 | 347,153 |
Net loss | (10,539) | (9,394) | (8,262) | (9,972) | (15,218) | (9,347) | (6,728) | (9,061) | (38,167) | (40,354) | (52,992) |
Series B common interest – allocation of net loss | (11,033) | (10,532) | (9,248) | (10,242) | (14,765) | (10,310) | (9,319) | (10,127) | (41,055) | (44,521) | (52,891) |
Net loss attributable to Brookfield DTLA | (5,409) | (4,954) | (3,785) | (4,689) | (8,807) | (4,752) | (3,849) | (4,584) | (18,837) | (21,992) | (29,614) |
Net loss available to common interest holders of Brookfield DTLA | (10,046) | (9,591) | (8,422) | (9,326) | (13,444) | (9,389) | (8,486) | (9,221) | (37,385) | (40,540) | (48,162) |
Series A-1 preferred interest | |||||||||||
Quarterly Financial Information [Line Items] | |||||||||||
Current dividends | 4,304 | 4,303 | 4,303 | 4,303 | 4,304 | 4,303 | 4,303 | 4,303 | 17,213 | 17,213 | 17,213 |
Senior participating preferred interest | |||||||||||
Quarterly Financial Information [Line Items] | |||||||||||
Current dividends | 0 | 0 | 0 | 0 | 529 | 608 | 597 | 587 | 0 | 2,321 | 10,044 |
Redemption measurement adjustment | 464 | 908 | 400 | 656 | 3,521 | 804 | 1,540 | 760 | 2,428 | 6,625 | 2,256 |
Series B preferred interest | |||||||||||
Quarterly Financial Information [Line Items] | |||||||||||
Current dividends | 1,135 | 881 | 68 | 0 | 0 | 0 | 0 | 0 | 2,084 | 0 | 0 |
Series A preferred stock | |||||||||||
Quarterly Financial Information [Line Items] | |||||||||||
Current dividends | $ 4,637 | $ 4,637 | $ 4,637 | $ 4,637 | $ 4,637 | $ 4,637 | $ 4,637 | $ 4,637 | $ 18,548 | $ 18,548 | $ 18,548 |
Investments in Real Estate - Su
Investments in Real Estate - Summary of Information Related to Investments in Real Estate (Details) - USD ($) $ in Thousands | Oct. 15, 2013 | Oct. 06, 2006 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||||
Encumbrances | $ 2,085,859 | |||||
Initial Cost to Company | ||||||
Land | 227,555 | |||||
Buildings and Improvements | 2,198,772 | |||||
Costs Capitalized Subsequent to Acquisition | ||||||
Improvements | 314,446 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 227,555 | |||||
Buildings and Improvements | 2,513,218 | |||||
Total | 2,740,773 | $ 2,675,249 | $ 2,619,422 | $ 2,557,865 | ||
Accumulated Depreciation | 329,149 | $ 256,130 | $ 189,108 | $ 121,612 | ||
Office properties | Wells Fargo Center – North Tower 333 S. Grand Avenue | ||||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||||
Encumbrances | 550,000 | |||||
Initial Cost to Company | ||||||
Land | 41,024 | |||||
Buildings and Improvements | 456,363 | |||||
Costs Capitalized Subsequent to Acquisition | ||||||
Improvements | 57,660 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 41,024 | |||||
Buildings and Improvements | 514,023 | |||||
Total | 555,047 | |||||
Accumulated Depreciation | 49,817 | |||||
Year Acquired | Oct. 15, 2013 | |||||
Office properties | BOA Plaza 333 S. Hope Street | ||||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||||
Encumbrances | 400,000 | |||||
Initial Cost to Company | ||||||
Land | 54,163 | |||||
Buildings and Improvements | 354,422 | |||||
Costs Capitalized Subsequent to Acquisition | ||||||
Improvements | 50,057 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 54,163 | |||||
Buildings and Improvements | 404,479 | |||||
Total | 458,642 | |||||
Accumulated Depreciation | 94,712 | |||||
Year Acquired | Oct. 6, 2006 | |||||
Office properties | Wells Fargo Center – South Tower 355 S. Grand Avenue | ||||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||||
Encumbrances | 250,000 | |||||
Initial Cost to Company | ||||||
Land | 21,231 | |||||
Buildings and Improvements | 401,149 | |||||
Costs Capitalized Subsequent to Acquisition | ||||||
Improvements | 17,633 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 21,231 | |||||
Buildings and Improvements | 418,782 | |||||
Total | 440,013 | |||||
Accumulated Depreciation | 35,318 | |||||
Year Acquired | Oct. 15, 2013 | |||||
Office properties | Gas Company Tower 525-555 W. Fifth Street | ||||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||||
Encumbrances | 450,000 | |||||
Initial Cost to Company | ||||||
Land | 20,742 | |||||
Buildings and Improvements | 396,159 | |||||
Costs Capitalized Subsequent to Acquisition | ||||||
Improvements | 53,569 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 20,742 | |||||
Buildings and Improvements | 449,728 | |||||
Total | 470,470 | |||||
Accumulated Depreciation | 30,797 | |||||
Year Acquired | Oct. 15, 2013 | |||||
Office properties | EY Plaza 725 S. Figueroa Street | ||||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||||
Encumbrances | 215,859 | |||||
Initial Cost to Company | ||||||
Land | 47,385 | |||||
Buildings and Improvements | 286,982 | |||||
Costs Capitalized Subsequent to Acquisition | ||||||
Improvements | 117,372 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 47,385 | |||||
Buildings and Improvements | 404,354 | |||||
Total | 451,739 | |||||
Accumulated Depreciation | 86,133 | |||||
Year Acquired | Oct. 6, 2006 | |||||
Office properties | 777 Tower 777 S. Figueroa Street | ||||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||||
Encumbrances | 220,000 | |||||
Initial Cost to Company | ||||||
Land | 38,010 | |||||
Buildings and Improvements | 303,697 | |||||
Costs Capitalized Subsequent to Acquisition | ||||||
Improvements | 17,798 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 38,010 | |||||
Buildings and Improvements | 321,495 | |||||
Total | 359,505 | |||||
Accumulated Depreciation | 32,372 | |||||
Year Acquired | Oct. 15, 2013 | |||||
Miscellaneous investments | Miscellaneous investments | ||||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||||
Encumbrances | 0 | |||||
Initial Cost to Company | ||||||
Land | 5,000 | |||||
Buildings and Improvements | 0 | |||||
Costs Capitalized Subsequent to Acquisition | ||||||
Improvements | 357 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 5,000 | |||||
Buildings and Improvements | 357 | |||||
Total | 5,357 | |||||
Accumulated Depreciation | $ 0 |
Investments in Real Estate - 63
Investments in Real Estate - Summary of Information Related to Investments in Real Estate (Footnote) (Details) $ in Billions | 12 Months Ended |
Dec. 31, 2016USD ($) | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Real estate for federal income tax purposes | $ 2.7 |
Building | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Useful life | 60 years |
Estimated salvage value | 5.00% |
Minimum | Building Improvements | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Useful life | 7 years |
Maximum | Building Improvements | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Useful life | 25 years |
Investments in Real Estate - Sc
Investments in Real Estate - Schedule of Reconciliation of Investments in Real Estate and Accumulated Depreciation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Investments in Real Estate | |||
Balance at beginning of year | $ 2,675,249 | $ 2,619,422 | $ 2,557,865 |
Acquisitions | 0 | 0 | 0 |
Improvements | 65,524 | 57,827 | 61,557 |
Dispositions | 0 | 2,000 | 0 |
Other | 0 | 0 | 0 |
Balance at end of year | 2,740,773 | 2,675,249 | 2,619,422 |
Accumulated Depreciation | |||
Balance at beginning of year | 256,130 | 189,108 | 121,612 |
Depreciation expense | 73,019 | 67,022 | 67,496 |
Other | 0 | 0 | 0 |
Balance at end of year | $ 329,149 | $ 256,130 | $ 189,108 |
Subsequent Event - Narrative (D
Subsequent Event - Narrative (Details) - USD ($) $ in Thousands | Feb. 28, 2017 | Nov. 30, 2016 | Jul. 13, 2016 | Jul. 13, 2016 | Jul. 11, 2016 | May 16, 2016 | Dec. 31, 2016 |
Subsequent Event [Line Items] | |||||||
Issuance of Series B preferred interest | $ 63,280 | ||||||
Series B preferred interest | |||||||
Subsequent Event [Line Items] | |||||||
Issuance of Series B preferred interest | $ 20,300 | $ 7,000 | $ 37,000 | $ 30,000 | $ 6,000 | $ 63,280 | |
Coupon rate, preferred interest | 9.00% | 9.00% | 9.00% | ||||
Series B preferred interest | Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Issuance of Series B preferred interest | $ 30,000 | ||||||
Coupon rate, preferred interest | 9.00% |