Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Mar. 23, 2018 | Jun. 30, 2017 | |
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, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
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, 2017 | Dec. 31, 2016 |
Investments in Real Estate: | ||
Land | $ 227,555 | $ 227,555 |
Buildings and improvements | 2,208,498 | 2,191,676 |
Tenant improvements | 320,269 | 321,542 |
Investments in real estate, cost | 2,756,322 | 2,740,773 |
Less: accumulated depreciation | 342,465 | 329,149 |
Investments in real estate, net | 2,413,857 | 2,411,624 |
Cash and cash equivalents | 31,958 | 30,301 |
Restricted cash | 35,547 | 60,084 |
Rents, deferred rents and other receivables, net | 129,482 | 118,211 |
Intangible assets, net | 58,289 | 75,586 |
Deferred charges, net | 69,635 | 64,967 |
Prepaid and other assets | 9,047 | 9,186 |
Total assets | 2,747,815 | 2,769,959 |
Liabilities: | ||
Mortgage loans, net | 1,991,692 | 2,076,804 |
Accounts payable and other liabilities | 80,810 | 85,504 |
Due to affiliates, net | 11,273 | 14,327 |
Intangible liabilities, net | 16,239 | 22,227 |
Total liabilities | 2,100,014 | 2,198,862 |
Commitments and Contingencies (See Note 13) | ||
Mezzanine Equity: | ||
Mezzanine equity | 990,749 | 829,532 |
Total mezzanine equity | 990,749 | 829,532 |
Stockholders’ Deficit: | ||
Common stock, $0.01 par value, 1,000 shares issued and outstanding as of December 31, 2017 and 2016 | 0 | 0 |
Additional paid-in capital | 194,210 | 194,210 |
Accumulated deficit | (256,877) | (215,264) |
Accumulated other comprehensive loss | (273) | (1,607) |
Noncontrolling interest – Series B common interest | (280,008) | (235,774) |
Total stockholders’ deficit | (342,948) | (258,435) |
Total liabilities and deficit | 2,747,815 | 2,769,959 |
Series A Preferred Stock | ||
Mezzanine Equity: | ||
Mezzanine equity | 391,400 | 372,852 |
Series A-1 preferred interest | ||
Mezzanine Equity: | ||
Mezzanine equity | 383,510 | 366,297 |
Senior participating preferred interest | ||
Mezzanine Equity: | ||
Mezzanine equity | 25,548 | 25,019 |
Series B preferred interest | ||
Mezzanine Equity: | ||
Mezzanine equity | $ 190,291 | $ 65,364 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
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, liquidation preference (in USD per share) | $ 25 | $ 25 |
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, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue: | |||
Rental income | $ 162,381 | $ 164,816 | $ 160,662 |
Tenant reimbursements | 96,518 | 95,578 | 88,615 |
Parking | 37,093 | 36,614 | 34,439 |
Interest and other | 10,330 | 13,684 | 15,374 |
Total revenue | 306,322 | 310,692 | 299,090 |
Expenses: | |||
Rental property operating and maintenance | 100,275 | 99,074 | 96,757 |
Real estate taxes | 37,758 | 37,401 | 35,675 |
Parking | 9,374 | 8,430 | 8,080 |
Other expense | 5,178 | 4,909 | 5,357 |
Depreciation and amortization | 97,808 | 103,970 | 98,160 |
Interest | 93,566 | 95,075 | 95,415 |
Total expenses | 343,959 | 348,859 | 339,444 |
Net loss | (37,637) | (38,167) | (40,354) |
Series B common interest – allocation of net loss | (45,699) | (41,055) | (44,521) |
Net loss attributable to Brookfield DTLA | (23,065) | (18,837) | (21,992) |
Net loss available to common interest holders of Brookfield DTLA | (41,613) | (37,385) | (40,540) |
Series A-1 preferred interest | |||
Expenses: | |||
Current dividends | 17,213 | 17,213 | 17,213 |
Senior participating preferred interest | |||
Expenses: | |||
Current dividends | 0 | 0 | 2,321 |
Redemption measurement adjustment | 479 | 2,428 | 6,625 |
Series B preferred interest | |||
Expenses: | |||
Current dividends | 13,435 | 2,084 | 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, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (37,637) | $ (38,167) | $ (40,354) |
Derivative transactions: | |||
Derivative holding gains (losses) | 2,799 | 2,042 | (1,078) |
Comprehensive loss | (34,838) | (36,125) | (41,432) |
Less: comprehensive loss attributable to noncontrolling interests | (13,107) | (18,261) | (18,926) |
Comprehensive loss available to common interest holders of Brookfield DTLA | $ (21,731) | $ (17,864) | $ (22,506) |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Non-controlling Interest |
Balance at beginning of year (in shares) at Dec. 31, 2014 | 1,000 | |||||
Balance at beginning 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) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (37,637) | (23,065) | (14,572) | |||
Other comprehensive (loss) income | 2,799 | 1,334 | 1,465 | |||
Dividends on Series A preferred stock, Series A-1 preferred interest, senior participating preferred interest and Series B preferred interest | (49,675) | (18,548) | (31,127) | |||
Balance at end of year (in shares) at Dec. 31, 2017 | 1,000 | |||||
Balance at end of year at Dec. 31, 2017 | $ (342,948) | $ 0 | $ 194,210 | $ (256,877) | $ (273) | $ (280,008) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Cash flows from operating activities: | |||
Net loss | $ (37,637) | $ (38,167) | $ (40,354) |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Gain on sale of land held for investment | 0 | 0 | (28) |
Depreciation and amortization | 97,808 | 103,970 | 98,160 |
(Recovery of) provision for doubtful accounts | (7) | (271) | 103 |
Amortization of below-market leases/ above-market leases | (2,219) | (3,465) | (2,559) |
Straight-line rent amortization | (11,237) | (16,798) | (21,598) |
Amortization of tenant inducements | 3,816 | 3,399 | 2,647 |
Amortization of discounts and debt issuance costs | 6,400 | 4,329 | 5,064 |
Changes in assets and liabilities: | |||
Rents, deferred rents and other receivables, net | (3,850) | (9,122) | (2,479) |
Deferred charges, net | (15,336) | (9,516) | (17,056) |
Prepaid and other assets | 139 | (53) | 2,382 |
Accounts payable and other liabilities | (3,037) | (3,469) | (877) |
Due to affiliates, net | (3,054) | 4,991 | 6,586 |
Net cash provided by operating activities | 31,786 | 35,828 | 29,991 |
Cash flows from investing activities: | |||
Proceeds from sale of land held for investment | 0 | 0 | 2,028 |
Expenditures for improvements to real estate | (74,696) | (57,350) | (60,089) |
Decrease (increase) in restricted cash | 24,537 | (6,254) | (6,712) |
Net cash used in investing activities | (50,159) | (63,604) | (64,773) |
Cash flows from financing activities: | |||
Proceeds from mortgage loans | 470,000 | 720,000 | 0 |
Principal payments on mortgage loans | (554,028) | (751,518) | (623) |
Dividends paid on Series A preferred stock | 0 | (21,893) | 0 |
Contribution from (distributions to) senior participating preferred interest, net | 50 | (616) | (32,769) |
Dividends paid to senior participating preferred interest | 0 | 0 | (3,051) |
Contributions from Series B preferred interest | 111,492 | 63,280 | 0 |
Contribution from Brookfield DTLA Holdings | 0 | 2,500 | 0 |
Financing fees paid | (7,484) | (7,412) | (43) |
Net cash provided by (used in) financing activities | 20,030 | 4,341 | (36,486) |
Net change in cash and cash equivalents | 1,657 | (23,435) | (71,268) |
Cash and cash equivalents at beginning of year | 30,301 | 53,736 | 125,004 |
Cash and cash equivalents at end of year | 31,958 | 30,301 | 53,736 |
Supplemental disclosure of cash flow information: | |||
Cash paid for interest | 88,160 | 89,630 | 90,093 |
Supplemental disclosure of non-cash activities: | |||
Accrual for real estate improvements | 25,616 | 24,465 | 16,290 |
Accrual for deferred leasing costs | 3,277 | 2,349 | 4,956 |
Writeoff of fully depreciated buildings and improvements | 4,007 | 0 | 0 |
Writeoff of fully depreciated tenant improvements | 56,291 | 0 | 0 |
Writeoff of fully amortized deferred charges | 20,481 | 0 | 0 |
Writeoff of fully amortized intangible assets | 68,990 | 0 | 0 |
Writeoff of fully amortized intangible liabilities | 16,783 | 0 | 0 |
Dividends declared but not yet paid | 0 | 0 | 21,893 |
Increase (decrease) in fair value of interest rate swap, net | $ 2,799 | $ 2,042 | $ (1,078) |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Dec. 31, 2017 | |
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 under the Laws of Canada (“BPO”, and together with its affiliates excluding the Company and its subsidiaries, the “Manager”). 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, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies 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. Principles of Consolidation and Basis of Presentation 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, 2017 and 2016 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, 2017 , 2016 and 2015 . 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. 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 the 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 Accounting Standards Update (“ASU”) 2014-09 establishing Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. ASU 2014-09, as amended by subsequent ASUs on the topic, 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 beginning after December 15, 2017. We are currently evaluating the impact of the adoption of this guidance on Brookfield DTLA’s consolidated financial statements. In February 2016, the FASB issued an update (“ASU 2016-02”) to ASC Topic 842, Leases, to amend the accounting guidance for leases. ASU 2016-02 sets out the principles for the recognition, measurement, presentation, and disclosure of leases for both lessees and lessors. The guidance requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on a principle of whether or not the lease is effectively a financed purchase. For all leases with a term greater than 12 months, lessees are required to record a right-of-use asset representing its right to use the underlying asset for the lease term and a liability to make lease payments on its balance sheet and will recognize lease expense on a straight‑line basis in its statement of operations. For leases with a term of 12 months or less, lessees are permitted to make an accounting policy election by class of underlying asset not to recognize lease assets or liabilities on its balance sheet. If a lessee makes this election, it will recognize lease expense for such leases using the effective interest method. We are currently evaluating the impact of the adoption of ASU 2016-02 on Brookfield DTLA’s consolidated financial statements, and we currently believe that the adoption of this standard will not significantly change the accounting for operating leases on Brookfield DTLA’s consolidated balance sheet where we are the lessor, and that such leases will be accounted for in a similar manner. Under ASU 2016-02, initial direct costs for both lessees and lessors will include only those costs that are incremental to the arrangement and would not have been incurred if the lease had not been obtained. As a result, Brookfield DTLA may no longer be able to capitalize internal leasing costs and instead may be required to expense these costs as incurred. ASU 2016-02 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2018, with early adoption permitted. In January 2018, the FASB released an exposure draft to ASU 2016-02 that if issued in its current form would (1) simplify transition requirements for both lessees and lessors by adding an option that would permit an organization to apply the transition provisions of the new standard at its adoption date instead of at the earliest comparative period presented in its financial statements, and (2) provide a practical expedient for lessors that would permit lessors to not be required to separate non-lease components from the associated lease components if certain conditions are met. We currently expect to adopt this standard effective January 01, 2019 using the practical expedients included in the current standard and the proposed exposure draft, if issued in final form, on a modified retrospective basis as required by ASU 2016‑02. 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 beginning after December 15, 2017, with early adoption permitted. We do not expect the adoption of this guidance 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. ASU 2016-18 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2017. Upon adoption, the change in restricted cash will no longer be presented as a separate line item within cash flows from investing activities in Brookfield DTLA’s consolidated statement of cash flows since such balances will be included in total cash at both the beginning and end of the reporting period. Brookfield DTLA will adopt the guidance in ASU 2016-18 effective January 1, 2018 and will retroactively restate its consolidated statement of cash flows for all prior interim and annual periods presented in its consolidated financial statements. 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 as 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 interim and annual reporting periods in fiscal years beginning after December 15, 2017. Brookfield DTLA will adopt the guidance in ASU 2017-01 effective January 1, 2018 on a prospective basis. After adoption, we expect that future acquisitions of operating and development properties, if any, will be accounted for as asset acquisitions under the new guidance, instead of as business combinations under the previous guidance. Additionally, we expect that most of the transaction costs associated with any future acquisitions will be capitalized in the consolidated balance sheet as part of the purchase price of the property acquired instead of being expensed as incurred in the consolidated statement of operations as part of acquisition-related expenses. In February 2017, the FASB issued ASU 2017-05, Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets to ASC Subtopic 610-20, Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets . ASU 2017-05 clarifies the scope of recently established guidance on nonfinancial asset derecognition as well as the accounting for partial sales of nonfinancial assets. This update conforms the derecognition guidance on nonfinancial assets with the model for transactions in ASC 606. ASU 2017-05 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2017. We do not expect the adoption of this guidance to have a material impact on Brookfield DTLA’s consolidated financial statements. In August 2017, the FASB issued ASU 2017-12, Targeted Improvements to Accounting for Hedging Activities to ASC Topic 815, Derivatives and Hedging . ASU 2017-12 introduced amendments intended to make targeted improvements to simplify the application of the hedge accounting guidance in current GAAP. The objective of the update is to improve the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. ASU 2017-12 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2018, with early adoption permitted, including adoption in an interim period. All transition requirements and elections should be applied to hedging relationships existing as of the date of adoption and the effect of the adoption should be reflected as of the beginning of the fiscal year of adoption. We are currently evaluating the impact of the adoption of this guidance 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, 2017 , 2016 and 2015 was $73.6 million , $73.0 million and $67.0 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, 2017 and 2016 . 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 $12.5 million and $9.9 million as of December 31, 2017 and 2016 , 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 $206 thousand and $213 thousand as of December 31, 2017 and 2016 , respectively. During the years ended December 31, 2017 and 2016 , Brookfield DTLA recorded recoveries of doubtful accounts of $7 thousand and $271 thousand , respectively. During the year ended December 31, 2015 , Brookfield DTLA recorded a provision for doubtful accounts of $103 thousand . 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 $39.8 million and $49.6 million as of December 31, 2017 and 2016 , respectively. Deferred leasing costs are amortized on a straight-line basis over the terms of the related leases as part of depreciation and amortization expense 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 $10.1 million and $9.1 million as of December 31, 2017 and 2016 , respectively. Discounts and debt issuance costs totaling $6.4 million , $4.3 million and $5.1 million were amortized during the years ended December 31, 2017 , 2016 and 2015 , 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, we will be subject to federal and state income tax on our taxable income at regular corporate tax rates, and we may be ineligible to qualify as a REIT for four subsequent tax years. Brookfield DTLA may be subject to certain state or local income taxes, or franchise taxes on its REIT activities. Brookfield DTLA recorded provisions for income taxes of $214 thousand , $584 thousand and $526 thousand during the years ended December 31, 2017 , 2016 and 2015 , respectively, which are included as part of real estate taxes expense in the consolidated statement of operations. Brookfield DTLA’s taxable income or loss is different than its financial statement income or loss. As of December 31, 2017 and 2016 , the Brookfield DTLA had net operating loss carryforwards totaling $243 million and $174 million , respectively, which expire between 2033 and 2037. As of December 31, 2017 and 2016 , Brookfield DTLA had deferred tax assets totaling $51 million and $61 million , respectively. Management has recorded a full valuation allowance for all periods presented as the Company does not expect to realize its deferred tax assets; therefore, no deferred tax assets have been recorded in Brookfield DTLA’s consolidated balance sheet as of December 31, 2017 and 2016 . On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was signed into law. The Act amends the Code to reduce tax rates and modify policies, credits, and deductions for individuals and businesses. Effective January 1, 2018, the Act reduces the corporate tax rate from a maximum rate of 35% to a flat rate of 21% for businesses. Since Brookfield DTLA has elected to qualify as a REIT with the intent of distributing 100% of its taxable income, there will be no material impact to the Company’s consolidated financial statements. Due to the Act, the Company’s deferred tax assets as of December 31, 2017 have been calculated using the 21% flat tax rate; however, given that management has recorded a full valuation allowance against the Company’s deferred tax assets, there is no impact on Brookfield DTLA’s consolidated financial statements. Uncertain Tax Positions— 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, 2017 and 2016 , and Brookfield DTLA does not expect its unrecognized tax benefits balance to change during the next 12 months. As of December 31, 2017 , Brookfield DTLA’s 2013 tax period and 2014 , 2015 and 2016 tax years remain open due to the statute of limitations and may be subject to examination by federal, state and local authorities. The short tax period ended October 15, 2013 for Brookfield DTLA and its subsidiaries remains 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, 2017 | |
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, 2017 December 31, 2016 Intangible Assets In-place leases $ 66,365 $ 110,519 Tenant relationships 30,078 46,248 Above-market leases 31,270 39,936 127,713 196,703 Less: accumulated amortization 69,424 121,117 Intangible assets, net $ 58,289 $ 75,586 Intangible Liabilities Below-market leases $ 59,561 $ 76,344 Less: accumulated amortization 43,322 54,117 Intangible liabilities, net $ 16,239 $ 22,227 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, 2017 2016 2015 Rental income $ 2,218 $ 3,465 $ 2,559 Depreciation and amortization expense 13,527 19,609 21,159 As of December 31, 2017 , 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 2018 $ 6,660 $ 5,112 $ 3,750 2019 5,617 4,306 3,178 2020 4,972 3,414 2,972 2021 4,734 3,327 2,800 2022 4,022 3,049 2,493 Thereafter 5,533 7,543 1,046 $ 31,538 $ 26,751 $ 16,239 |
Mortgage Loans
Mortgage Loans | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 December 31, 2016 Floating-Rate Debt Variable-Rate Loans: Wells Fargo Center–North Tower (1) 4/9/2019 3.73 % $ 370,000 $ — Wells Fargo Center–North Tower (2) 4/9/2019 6.73 % 55,000 — Wells Fargo Center–North Tower (3) 4/9/2019 8.48 % 45,000 — Wells Fargo Center–South Tower (4) 12/6/2018 5.09 % 250,000 250,000 777 Tower (5) 11/1/2018 3.55 % 220,000 220,000 Figueroa at 7th (6) 2/6/2018 3.68 % 35,000 35,000 Total variable-rate loans 975,000 505,000 Variable-Rate Swapped to Fixed-Rate Loan: EY Plaza (7) 11/27/2020 3.93 % 176,831 180,859 Total floating-rate debt 1,151,831 685,859 Fixed-Rate Debt: BOA Plaza 9/1/2024 4.05 % 400,000 400,000 Gas Company Tower 8/6/2021 3.47 % 319,000 319,000 Gas Company Tower 8/6/2021 6.50 % 131,000 131,000 Total fixed-rate debt 850,000 850,000 Debt Refinanced: Wells Fargo Center–North Tower — 550,000 Total debt 2,001,831 2,085,859 Less: unamortized discounts and debt issuance costs 10,139 9,055 Total debt, net $ 1,991,692 $ 2,076,804 __________ (1) This loan bears interest at LIBOR plus 2.25% . 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 2.75% . Brookfield DTLA has three options to extend the maturity date of this loan, each for a period of one year, subject to meeting certain debt yield amounts (as specified in the loan agreement). (2) This loan bears interest at LIBOR plus 5.25% . 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 2.75% . Brookfield DTLA has three options to extend the maturity date of this loan, each for a period of one year, subject to meeting certain debt yield amounts (as specified in the loan agreement). (3) This loan bears interest at LIBOR plus 7.00% . 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 2.75% . Brookfield DTLA has three options to extend the maturity date of this loan, each for a period of one year, subject to meeting certain debt yield amounts (as specified in the loan agreement). (4) 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 this loan, each for a period of one year, subject to meeting certain debt yield amounts (as specified in the loan agreement). As of December 31, 2017 , a maximum future advance amount of $20.0 million is available under this loan 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. (5) 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 this loan, each for a period of one year, subject to meeting certain debt yield amounts and loan to value ratios (as specified in the loan agreement). As of December 31, 2017 , we do not meet the criteria specified in the loan agreement to extend this loan on its contractual maturity date. (6) This loan bears interest at LIBOR plus 2.25% . On February 6, 2018 , Brookfield DTLA refinanced this loan. See Note 16 “Subsequent Events.” (7) 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 4.29% as of December 31, 2017 and 4.42% as of December 31, 2016 . Debt Refinanced Figueroa at 7th— During the year ended December 31, 2017 , Brookfield DTLA entered into agreements with the lender that extended the original maturity date of the mortgage loan secured by the Figueroa at 7th retail property from September 10, 2017 to January 8, 2018 . On January 8, 2018 , the Company extended the maturity date of the mortgage loan to February 28, 2018 . On February 6, 2018 , Brookfield DTLA refinanced the $35.0 million mortgage loan and received net proceeds totaling $23.1 million , which will be used for general corporate purposes. See Note 16 “Subsequent Events.” The new $58.5 million loan bears interest at a fixed rate equal to 3.88% , requires the payment of interest-only until maturity, and matures on March 1, 2023 . The loan is locked out from prepayment until March 1, 2020 , after which it can be prepaid, in whole or in part, with prepayment fees (as defined in the underlying loan agreement) until November 1, 2022 , after which the loan may be repaid without penalty. Wells Fargo Center–North Tower— On April 5, 2017 , Brookfield DTLA refinanced the $550.0 million mortgage loan secured by Wells Fargo Center–North Tower. In connection with the refinancing, the Company repaid $80.0 million of principal and incurred transaction costs totaling $7.4 million . The Company received an $82.0 million cash contribution from Brookfield DTLA Holdings during the year ended December 31, 2017 that was used to pay for costs associated with the refinancing of Wells Fargo Center–North Tower. The new $470.0 million loan is comprised of a $370.0 million mortgage loan, a $55.0 million mezzanine loan and a $45.0 million mezzanine loan, each of which bears interest at variable rates equal to LIBOR plus 2.25% , 5.25% and 7.00% , respectively, and require the payment of interest-only until maturity. As required by the mortgage and mezzanine loan agreements, the Company entered into interest rate cap agreements with a total notional amount of $470.0 million that limit the LIBOR portion of the interest rates to 2.75% . The mortgage and mezzanine loans mature on April 9, 2019 . Brookfield DTLA has three options to extend the maturity date of the loans, each for a period of one year, subject to meeting certain debt yield amounts (as specified in the mortgage and mezzanine loan agreements). The mortgage and mezzanine loans can be prepaid, in whole or in part, with prepayment penalties (as defined in the underlying loan agreements) until July 9, 2018 after which the loans can be repaid without penalty. A voluntary prepayment of the mortgage or mezzanine loans requires a simultaneous pro-rata prepayment of all loans encumbering this property. Debt Maturities As Brookfield DTLA’s debt matures, principal payment obligations present significant future cash requirements. As of December 31, 2017 , our debt to be repaid during the next five years and thereafter is as follows (in thousands): 2018 (1) $ 509,231 2019 474,449 2020 168,151 2021 450,000 2022 — Thereafter 400,000 $ 2,001,831 __________ (1) On February 6, 2018 , Brookfield DTLA refinanced the $35.0 million mortgage loan secured by Figueroa at 7th. See Note 16 “Subsequent Events.” As of December 31, 2017 , $562.8 million of our debt may be prepaid without penalty, $400.0 million may be defeased (as defined in the underlying loan agreements), and $1,039.0 million may be prepaid with prepayment penalties. 777 Tower— Brookfield DTLA currently intends to extend or refinance the $220.0 million mortgage loan secured by 777 Tower on or about its November 1, 2018 maturity date. As of December 31, 2017 , we do not meet the criteria specified in the loan agreement to extend the maturity date of this loan, and we do not have a commitment from the lenders to extend the maturity date of or to refinance this loan. As of December 31, 2017 , the Company does not expect to make a principal paydown when the loan is extended or refinanced (based on market conditions as of that date). Wells Fargo Center–South Tower— Brookfield DTLA currently intends to extend or refinance the $250.0 million mortgage loan secured by Wells Fargo Center–South Tower on or about its December 6, 2018 maturity date. The Company has three options to extend the maturity date of this loan, each for a period of one year, subject to meeting certain debt yield amounts (as specified in the loan agreement). As of December 31, 2017 , we meet the criteria specified in the loan agreement to extend the maturity date of this loan for one year. Non-Recourse Carve Out Guarantees All of Brookfield DTLA’s $2.0 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 (as defined in the loan agreements) 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 $2.0 billion as of December 31, 2017 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, 2017 and were in compliance with the amounts required by the loan agreements. Pursuant to the terms of the EY Plaza mortgage loan agreement, 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 EY Plaza mortgage loan agreement. 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, 2017 | |
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 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. 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, 2017 and 2016 . 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 During the year ended December 31, 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, 2017 , 2016 and 2015 , the Company paid distributions and dividends totaling $0.5 million , $0.6 million and $35.8 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, 2017 and 2016 , 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. No dividends were declared on the Series A preferred stock during the years ended December 31, 2017 , and 2016 . 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, 2017 , the cumulative amount of unpaid dividends totals $148.1 million and has been reflected in the carrying amount of the Series A preferred stock. During the year ended December 31, 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. 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, 2017 , the Series A preferred stock is reported at its redemption value of $391.4 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, 2017 . 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, 2017 , the Series A-1 preferred interest is reported at its redemption value of $383.5 million calculated using its liquidation value of $225.7 million plus $157.8 million of accumulated and unpaid dividends on such Series A-1 preferred interest through December 31, 2017 . 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. During the year ended December 31, 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, 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. During the years ended December 31, 2017 and 2016 , Brookfield DTLA made distributions totaling $0.5 million and $0.6 million , respectively, to Brookfield DTLA Holdings as returns of investment related to the senior participating preferred interest held by Brookfield DTLA Holdings using cash on hand. Additionally, the Company received a cash contribution of $0.5 million during the year ended December 31, 2017 from Brookfield DTLA Holdings, which was used for general corporate purposes. During the period from January 23, 2018 through March 8, 2018 , Brookfield DTLA made distributions totaling $0.5 million to Brookfield DTLA Holdings as returns of investment related to the senior participating preferred interest held by Brookfield DTLA Holdings using cash on hand. See Note 16 “Subsequent Events.” As of December 31, 2017 , the senior participating preferred interest is reported at its redemption value of $25.5 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. 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. During the year ended December 31, 2016 , the Company received cash contributions totaling $63.3 million from Brookfield DTLA Holdings under this commitment, which are entitled to a preferred return of 9.0% as part of the Series B preferred interest. The Company used $20.3 million of the contributions received to pay for costs associated with the refinancing of the Wells Fargo Center–South Tower mortgage loan and $19.7 million to pay for costs associated with the refinancing of the Gas Company Tower mortgage loan, with the remainder used for general corporate purposes. During the year ended December 31, 2017 , the Company received cash contributions totaling $111.5 million from Brookfield DTLA Holdings, which are entitled to a preferred return of 9.0% as part of the Series B preferred interest. The Company used $82.0 million of the contributions received to pay for costs associated with the refinancing of the Wells Fargo Center–North Tower mortgage loan, with the remainder used for general corporate purposes. As of December 31, 2017 , the Series B preferred interest is reported at its redemption value of $190.3 million calculated using its liquidation value of $174.8 million plus $15.5 million of accumulated and unpaid dividends on such Series B preferred interest through December 31, 2017 . 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, 2014 9,730,370 $ 357,649 $ 331,871 $ 50,080 $ — $ 739,600 Issuance of Series B preferred interest — — 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 Redemption measurement adjustment 2,428 2,428 Dividends declared — — Cash distributions (616 ) (616 ) Balance, December 31, 2016 9,730,370 372,852 366,297 25,019 65,364 829,532 Issuance of Series B preferred interest 111,492 111,492 Current dividends 18,548 17,213 — 13,435 49,196 Redemption measurement adjustment 479 479 Dividends declared — — Cash contribution, net 50 50 Balance, December 31, 2017 9,730,370 $ 391,400 $ 383,510 $ 25,548 $ 190,291 $ 990,749 |
Stockholders' Deficit
Stockholders' Deficit | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 and 2016 , 1,000 shares of common stock were issued and outstanding. No dividends were declared on the common stock during the years ended December 31, 2017 , 2016 and 2015 . 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. During the year ended December 31, 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, 2017 | |
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 | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss A summary of the change in accumulated other comprehensive loss related to Brookfield DTLA’s cash flow hedges is as follows (in thousands): For the Year Ended December 31, 2017 2016 2015 Balance at beginning of year $ (3,373 ) $ (5,415 ) $ (4,337 ) Other comprehensive income (loss) before reclassifications 2,799 2,042 (1,078 ) Amounts reclassified from accumulated — — — Net current-year other comprehensive income (loss) 2,799 2,042 (1,078 ) Balance at end of year $ (574 ) $ (3,373 ) $ (5,415 ) |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 $ (574 ) $ — $ (574 ) $ — December 31, 2016 (3,373 ) — (3,373 ) — December 31, 2015 (5,415 ) — (5,415 ) — Interest rate caps at: December 31, 2017 $ 15 $ — $ 15 $ — December 31, 2016 53 — 53 — December 31, 2015 19 — 19 — |
Financial Instruments
Financial Instruments | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 December 31, 2016 Derivatives designated as cash flow hedging instruments: Interest rate swap $ (574 ) $ (3,373 ) 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, 2017 $ 2,799 $ — December 31, 2016 2,042 — December 31, 2015 (1,078 ) — Interest Rate Swap— As of December 31, 2017 and 2016 , Brookfield DTLA held an interest rate swap assigned to the EY Plaza mortgage loan with notional amounts of $176.8 million and $180.9 million , respectively. 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, 2017 December 31, 2016 Wells Fargo Center–North Tower $ 370,000 $ — Wells Fargo Center–North Tower 55,000 — Wells Fargo Center–North Tower 45,000 — Wells Fargo Center–South Tower 270,000 270,000 777 Tower 220,000 220,000 $ 960,000 $ 490,000 As required by the Wells Fargo Center–North Tower mortgage and mezzanine loan agreements, on April 5, 2017 the Company entered into interest rate cap agreements with a total notional amount of $470.0 million that limit the LIBOR portion of the interest rate to 2.75% . 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, 2017 December 31, 2016 Estimated fair value $ 2,003,600 $ 2,059,449 Carrying amount 2,001,831 2,085,859 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, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Management Agreements Certain subsidiaries of Brookfield DTLA have entered into arrangements with the Manager, pursuant to which the Manager provides property management and various other services. Property management fees under the management agreements entered into in connection with these arrangements are calculated based on 2.75% of rents collected (as defined in the management agreements). In addition, the Company pays the Manager 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 the applicable subsidiaries of 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, 2017 2016 2015 Property management fee expense $ 8,136 $ 7,964 $ 7,445 Asset management fee expense 6,330 6,330 6,292 General, administrative and reimbursable expenses 2,613 2,466 2,593 Leasing and construction management fees 5,198 3,049 6,396 Insurance Agreements Properties held by certain Brookfield DTLA subsidiaries are covered under insurance policies entered into by the Manager 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 $402.5 million of earthquake insurance, and $372.5 million of flood and weather catastrophe insurance. In addition, Brookfield DTLA’s properties are covered by a terrorism insurance policy that provides a maximum of $4.0 billion per occurrence 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 the Manager and Brookfield DTLA reimburses the Manager for the actual cost of such premiums. A summary of costs incurred by the applicable Brookfield DTLA subsidiaries 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, 2017 2016 2015 Insurance expense $ 7,795 $ 7,948 $ 8,532 |
Rental Income
Rental Income | 12 Months Ended |
Dec. 31, 2017 | |
Leases [Abstract] | |
Rental Income | Rental Income Brookfield DTLA’s properties are leased to tenants under net operating leases with initial expiration dates ranging from 2018 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, 2017 is as follows (in thousands): 2018 $ 153,020 2019 153,948 2020 150,601 2021 149,381 2022 132,706 Thereafter 629,976 $ 1,369,632 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 $3.1 million , $2.8 million and $2.8 million during the years ended December 31, 2017 , 2016 and 2015 , respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Concentration of Tenant Credit Risk 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, 2017 , 2016 and 2015 . During the years ended December 31, 2017 , 2016 and 2015 , 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% , 100% and 98% of Brookfield DTLA’s consolidated revenue during the years ended December 31, 2017 , 2016 and 2015 , respectively. Litigation 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. |
Quarterly Financial Information
Quarterly Financial Information (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 Revenue $ 75,915 $ 76,070 $ 77,067 $ 77,270 Expenses 86,021 84,571 86,204 87,163 Net loss (10,106 ) (8,501 ) (9,137 ) (9,893 ) 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 – redemption measurement adjustment 56 (191 ) 385 229 Series B preferred interest – current dividends 1,644 3,861 3,965 3,965 Series B common interest – allocation of net loss (10,858 ) (11,050 ) (11,738 ) (12,053 ) Net loss attributable to Brookfield DTLA (5,251 ) (5,424 ) (6,052 ) (6,338 ) Series A preferred stock – current dividends 4,637 4,637 4,637 4,637 Net loss available to common interest holders of Brookfield DTLA $ (9,888 ) $ (10,061 ) $ (10,689 ) $ (10,975 ) 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 – 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 ) |
Investments in Real Estate
Investments in Real Estate | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 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 $ 470,000 $ 41,024 $ 456,363 $ 72,008 $ — $ 41,024 $ 528,371 $ 569,395 $ 53,058 2013 BOA Plaza 400,000 54,163 354,422 44,245 — 54,163 398,667 452,830 96,407 2006 Wells Fargo Center– South Tower 355 S. Grand Avenue 250,000 21,231 401,149 23,956 — 21,231 425,105 446,336 39,351 2013 Gas Company 450,000 20,742 396,159 59,552 — 20,742 455,711 476,453 38,521 2013 EY Plaza (3) 725 S. Figueroa 211,831 47,385 286,982 111,707 — 47,385 398,689 446,074 81,611 2006 777 Tower 777 S. Figueroa 220,000 38,010 303,697 14,770 — 38,010 318,467 356,477 33,517 2013 Miscellaneous — 5,000 — 3,757 — 5,000 3,757 8,757 — $ 2,001,831 $ 227,555 $ 2,198,772 $ 329,995 $ — $ 227,555 $ 2,528,767 $ 2,756,322 $ 342,465 __________ (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, 2017 . (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, 2017 2016 2015 Investments in Real Estate Balance at beginning of year $ 2,740,773 $ 2,675,249 $ 2,619,422 Additions during the year: Improvements 75,847 65,524 57,827 Deductions during the year: Dispositions — — 2,000 Other (1) 60,298 — — Balance at end of year $ 2,756,322 $ 2,740,773 $ 2,675,249 __________ (1) During the year ended December 31, 2017 , the amount reported represents the cost of fully depreciated buildings and improvements and tenant improvements written off during the period. 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, 2017 2016 2015 Accumulated Depreciation Balance at beginning of year $ 329,149 $ 256,130 $ 189,108 Additions during the year: Depreciation expense 73,614 73,019 67,022 Deductions during the year: Other (1) 60,298 — — Balance at end of year $ 342,465 $ 329,149 $ 256,130 __________ (1) During the year ended December 31, 2017 , the amount reported represents the accumulated depreciation of fully depreciated buildings and improvements and tenant improvements written off during the period. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Refinancing of the Figueroa at 7th Mortgage Loan— On January 8, 2018 , the Company extended the maturity date of the mortgage loan secured by the Figueroa at 7th retail property to February 28, 2018 . On February 6, 2018 , Brookfield DTLA refinanced the $35.0 million mortgage loan and received net proceeds totaling $23.1 million , which will be used for general corporate purposes. The new $58.5 million loan bears interest at a fixed rate equal to 3.88% , requires the payment of interest-only until maturity, and matures on March 1, 2023 . The loan is locked out from prepayment until March 1, 2020 , after which it can be prepaid, in whole or in part, with prepayment fees (as defined in the underlying loan agreement) until November 1, 2022 , after which the loan may be repaid without penalty. Distributions to Brookfield DTLA Holdings— During the period from January 23, 2018 through March 8, 2018 , Brookfield DTLA made distributions totaling $0.5 million to Brookfield DTLA Holdings as returns of investment related to the senior participating preferred interest held by Brookfield DTLA Holdings using cash on hand. |
Basis of Presentation and Sum24
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
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. Principles of Consolidation and Basis of Presentation 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, 2017 and 2016 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, 2017 , 2016 and 2015 . |
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. |
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 the 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 Accounting Standards Update (“ASU”) 2014-09 establishing Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. ASU 2014-09, as amended by subsequent ASUs on the topic, 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 beginning after December 15, 2017. We are currently evaluating the impact of the adoption of this guidance on Brookfield DTLA’s consolidated financial statements. In February 2016, the FASB issued an update (“ASU 2016-02”) to ASC Topic 842, Leases, to amend the accounting guidance for leases. ASU 2016-02 sets out the principles for the recognition, measurement, presentation, and disclosure of leases for both lessees and lessors. The guidance requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on a principle of whether or not the lease is effectively a financed purchase. For all leases with a term greater than 12 months, lessees are required to record a right-of-use asset representing its right to use the underlying asset for the lease term and a liability to make lease payments on its balance sheet and will recognize lease expense on a straight‑line basis in its statement of operations. For leases with a term of 12 months or less, lessees are permitted to make an accounting policy election by class of underlying asset not to recognize lease assets or liabilities on its balance sheet. If a lessee makes this election, it will recognize lease expense for such leases using the effective interest method. We are currently evaluating the impact of the adoption of ASU 2016-02 on Brookfield DTLA’s consolidated financial statements, and we currently believe that the adoption of this standard will not significantly change the accounting for operating leases on Brookfield DTLA’s consolidated balance sheet where we are the lessor, and that such leases will be accounted for in a similar manner. Under ASU 2016-02, initial direct costs for both lessees and lessors will include only those costs that are incremental to the arrangement and would not have been incurred if the lease had not been obtained. As a result, Brookfield DTLA may no longer be able to capitalize internal leasing costs and instead may be required to expense these costs as incurred. ASU 2016-02 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2018, with early adoption permitted. In January 2018, the FASB released an exposure draft to ASU 2016-02 that if issued in its current form would (1) simplify transition requirements for both lessees and lessors by adding an option that would permit an organization to apply the transition provisions of the new standard at its adoption date instead of at the earliest comparative period presented in its financial statements, and (2) provide a practical expedient for lessors that would permit lessors to not be required to separate non-lease components from the associated lease components if certain conditions are met. We currently expect to adopt this standard effective January 01, 2019 using the practical expedients included in the current standard and the proposed exposure draft, if issued in final form, on a modified retrospective basis as required by ASU 2016‑02. 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 beginning after December 15, 2017, with early adoption permitted. We do not expect the adoption of this guidance 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. ASU 2016-18 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2017. Upon adoption, the change in restricted cash will no longer be presented as a separate line item within cash flows from investing activities in Brookfield DTLA’s consolidated statement of cash flows since such balances will be included in total cash at both the beginning and end of the reporting period. Brookfield DTLA will adopt the guidance in ASU 2016-18 effective January 1, 2018 and will retroactively restate its consolidated statement of cash flows for all prior interim and annual periods presented in its consolidated financial statements. 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 as 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 interim and annual reporting periods in fiscal years beginning after December 15, 2017. Brookfield DTLA will adopt the guidance in ASU 2017-01 effective January 1, 2018 on a prospective basis. After adoption, we expect that future acquisitions of operating and development properties, if any, will be accounted for as asset acquisitions under the new guidance, instead of as business combinations under the previous guidance. Additionally, we expect that most of the transaction costs associated with any future acquisitions will be capitalized in the consolidated balance sheet as part of the purchase price of the property acquired instead of being expensed as incurred in the consolidated statement of operations as part of acquisition-related expenses. In February 2017, the FASB issued ASU 2017-05, Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets to ASC Subtopic 610-20, Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets . ASU 2017-05 clarifies the scope of recently established guidance on nonfinancial asset derecognition as well as the accounting for partial sales of nonfinancial assets. This update conforms the derecognition guidance on nonfinancial assets with the model for transactions in ASC 606. ASU 2017-05 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2017. We do not expect the adoption of this guidance to have a material impact on Brookfield DTLA’s consolidated financial statements. In August 2017, the FASB issued ASU 2017-12, Targeted Improvements to Accounting for Hedging Activities to ASC Topic 815, Derivatives and Hedging . ASU 2017-12 introduced amendments intended to make targeted improvements to simplify the application of the hedge accounting guidance in current GAAP. The objective of the update is to improve the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. ASU 2017-12 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2018, with early adoption permitted, including adoption in an interim period. All transition requirements and elections should be applied to hedging relationships existing as of the date of adoption and the effect of the adoption should be reflected as of the beginning of the fiscal year of adoption. We are currently evaluating the impact of the adoption of this guidance 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, 2017 , 2016 and 2015 was $73.6 million , $73.0 million and $67.0 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, 2017 and 2016 . |
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 $12.5 million and $9.9 million as of December 31, 2017 and 2016 , 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 $206 thousand and $213 thousand as of December 31, 2017 and 2016 , respectively. During the years ended December 31, 2017 and 2016 , Brookfield DTLA recorded recoveries of doubtful accounts of $7 thousand and $271 thousand , respectively. During the year ended December 31, 2015 , Brookfield DTLA recorded a provision for doubtful accounts of $103 thousand . |
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 $39.8 million and $49.6 million as of December 31, 2017 and 2016 , respectively. Deferred leasing costs are amortized on a straight-line basis over the terms of the related leases as part of depreciation and amortization expense 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 $10.1 million and $9.1 million as of December 31, 2017 and 2016 , respectively. Discounts and debt issuance costs totaling $6.4 million , $4.3 million and $5.1 million were amortized during the years ended December 31, 2017 , 2016 and 2015 , 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, we will be subject to federal and state income tax on our taxable income at regular corporate tax rates, and we may be ineligible to qualify as a REIT for four subsequent tax years. Brookfield DTLA may be subject to certain state or local income taxes, or franchise taxes on its REIT activities. Brookfield DTLA recorded provisions for income taxes of $214 thousand , $584 thousand and $526 thousand during the years ended December 31, 2017 , 2016 and 2015 , respectively, which are included as part of real estate taxes expense in the consolidated statement of operations. Brookfield DTLA’s taxable income or loss is different than its financial statement income or loss. As of December 31, 2017 and 2016 , the Brookfield DTLA had net operating loss carryforwards totaling $243 million and $174 million , respectively, which expire between 2033 and 2037. As of December 31, 2017 and 2016 , Brookfield DTLA had deferred tax assets totaling $51 million and $61 million , respectively. Management has recorded a full valuation allowance for all periods presented as the Company does not expect to realize its deferred tax assets; therefore, no deferred tax assets have been recorded in Brookfield DTLA’s consolidated balance sheet as of December 31, 2017 and 2016 . On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was signed into law. The Act amends the Code to reduce tax rates and modify policies, credits, and deductions for individuals and businesses. Effective January 1, 2018, the Act reduces the corporate tax rate from a maximum rate of 35% to a flat rate of 21% for businesses. Since Brookfield DTLA has elected to qualify as a REIT with the intent of distributing 100% of its taxable income, there will be no material impact to the Company’s consolidated financial statements. Due to the Act, the Company’s deferred tax assets as of December 31, 2017 have been calculated using the 21% flat tax rate; however, given that management has recorded a full valuation allowance against the Company’s deferred tax assets, there is no impact on Brookfield DTLA’s consolidated financial statements. |
Uncertain Tax Positions | Uncertain Tax Positions— 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, 2017 and 2016 , and Brookfield DTLA does not expect its unrecognized tax benefits balance to change during the next 12 months. As of December 31, 2017 , Brookfield DTLA’s 2013 tax period and 2014 , 2015 and 2016 tax years remain open due to the statute of limitations and may be subject to examination by federal, state and local authorities. The short tax period ended October 15, 2013 for Brookfield DTLA and its subsidiaries remains 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, 2017 | |
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, 2017 December 31, 2016 Intangible Assets In-place leases $ 66,365 $ 110,519 Tenant relationships 30,078 46,248 Above-market leases 31,270 39,936 127,713 196,703 Less: accumulated amortization 69,424 121,117 Intangible assets, net $ 58,289 $ 75,586 Intangible Liabilities Below-market leases $ 59,561 $ 76,344 Less: accumulated amortization 43,322 54,117 Intangible liabilities, net $ 16,239 $ 22,227 |
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, 2017 2016 2015 Rental income $ 2,218 $ 3,465 $ 2,559 Depreciation and amortization expense 13,527 19,609 21,159 |
Schedule of Estimated Future Amortization/Accretion of Intangible Assets and Liabilities | As of December 31, 2017 , 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 2018 $ 6,660 $ 5,112 $ 3,750 2019 5,617 4,306 3,178 2020 4,972 3,414 2,972 2021 4,734 3,327 2,800 2022 4,022 3,049 2,493 Thereafter 5,533 7,543 1,046 $ 31,538 $ 26,751 $ 16,239 |
Mortgage Loans (Tables)
Mortgage Loans (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 December 31, 2016 Floating-Rate Debt Variable-Rate Loans: Wells Fargo Center–North Tower (1) 4/9/2019 3.73 % $ 370,000 $ — Wells Fargo Center–North Tower (2) 4/9/2019 6.73 % 55,000 — Wells Fargo Center–North Tower (3) 4/9/2019 8.48 % 45,000 — Wells Fargo Center–South Tower (4) 12/6/2018 5.09 % 250,000 250,000 777 Tower (5) 11/1/2018 3.55 % 220,000 220,000 Figueroa at 7th (6) 2/6/2018 3.68 % 35,000 35,000 Total variable-rate loans 975,000 505,000 Variable-Rate Swapped to Fixed-Rate Loan: EY Plaza (7) 11/27/2020 3.93 % 176,831 180,859 Total floating-rate debt 1,151,831 685,859 Fixed-Rate Debt: BOA Plaza 9/1/2024 4.05 % 400,000 400,000 Gas Company Tower 8/6/2021 3.47 % 319,000 319,000 Gas Company Tower 8/6/2021 6.50 % 131,000 131,000 Total fixed-rate debt 850,000 850,000 Debt Refinanced: Wells Fargo Center–North Tower — 550,000 Total debt 2,001,831 2,085,859 Less: unamortized discounts and debt issuance costs 10,139 9,055 Total debt, net $ 1,991,692 $ 2,076,804 __________ (1) This loan bears interest at LIBOR plus 2.25% . 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 2.75% . Brookfield DTLA has three options to extend the maturity date of this loan, each for a period of one year, subject to meeting certain debt yield amounts (as specified in the loan agreement). (2) This loan bears interest at LIBOR plus 5.25% . 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 2.75% . Brookfield DTLA has three options to extend the maturity date of this loan, each for a period of one year, subject to meeting certain debt yield amounts (as specified in the loan agreement). (3) This loan bears interest at LIBOR plus 7.00% . 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 2.75% . Brookfield DTLA has three options to extend the maturity date of this loan, each for a period of one year, subject to meeting certain debt yield amounts (as specified in the loan agreement). (4) 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 this loan, each for a period of one year, subject to meeting certain debt yield amounts (as specified in the loan agreement). As of December 31, 2017 , a maximum future advance amount of $20.0 million is available under this loan 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. (5) 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 this loan, each for a period of one year, subject to meeting certain debt yield amounts and loan to value ratios (as specified in the loan agreement). As of December 31, 2017 , we do not meet the criteria specified in the loan agreement to extend this loan on its contractual maturity date. (6) This loan bears interest at LIBOR plus 2.25% . On February 6, 2018 , Brookfield DTLA refinanced this loan. See Note 16 “Subsequent Events.” (7) 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, 2017 , our debt to be repaid during the next five years and thereafter is as follows (in thousands): 2018 (1) $ 509,231 2019 474,449 2020 168,151 2021 450,000 2022 — Thereafter 400,000 $ 2,001,831 __________ (1) On February 6, 2018 , Brookfield DTLA refinanced the $35.0 million mortgage loan secured by Figueroa at 7th. See Note 16 “Subsequent Events.” |
Mezzanine Equity (Tables)
Mezzanine Equity (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
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, 2014 9,730,370 $ 357,649 $ 331,871 $ 50,080 $ — $ 739,600 Issuance of Series B preferred interest — — 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 Redemption measurement adjustment 2,428 2,428 Dividends declared — — Cash distributions (616 ) (616 ) Balance, December 31, 2016 9,730,370 372,852 366,297 25,019 65,364 829,532 Issuance of Series B preferred interest 111,492 111,492 Current dividends 18,548 17,213 — 13,435 49,196 Redemption measurement adjustment 479 479 Dividends declared — — Cash contribution, net 50 50 Balance, December 31, 2017 9,730,370 $ 391,400 $ 383,510 $ 25,548 $ 190,291 $ 990,749 |
Accumulated Other Comprehensi28
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Summary of Change in Accumulated Other Comprehensive Loss Related to Cash Flow Hedges | A summary of the change in accumulated other comprehensive loss related to Brookfield DTLA’s cash flow hedges is as follows (in thousands): For the Year Ended December 31, 2017 2016 2015 Balance at beginning of year $ (3,373 ) $ (5,415 ) $ (4,337 ) Other comprehensive income (loss) before reclassifications 2,799 2,042 (1,078 ) Amounts reclassified from accumulated — — — Net current-year other comprehensive income (loss) 2,799 2,042 (1,078 ) Balance at end of year $ (574 ) $ (3,373 ) $ (5,415 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 $ (574 ) $ — $ (574 ) $ — December 31, 2016 (3,373 ) — (3,373 ) — December 31, 2015 (5,415 ) — (5,415 ) — Interest rate caps at: December 31, 2017 $ 15 $ — $ 15 $ — December 31, 2016 53 — 53 — December 31, 2015 19 — 19 — |
Financial Instruments (Tables)
Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Summary of Fair Value of 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, 2017 December 31, 2016 Derivatives designated as cash flow hedging instruments: Interest rate swap $ (574 ) $ (3,373 ) |
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, 2017 $ 2,799 $ — December 31, 2016 2,042 — December 31, 2015 (1,078 ) — |
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, 2017 December 31, 2016 Wells Fargo Center–North Tower $ 370,000 $ — Wells Fargo Center–North Tower 55,000 — Wells Fargo Center–North Tower 45,000 — Wells Fargo Center–South Tower 270,000 270,000 777 Tower 220,000 220,000 $ 960,000 $ 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, 2017 December 31, 2016 Estimated fair value $ 2,003,600 $ 2,059,449 Carrying amount 2,001,831 2,085,859 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Summary of Costs Incurred Under Agreements with Related Parties | A summary of costs incurred by the applicable Brookfield DTLA subsidiaries 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, 2017 2016 2015 Insurance expense $ 7,795 $ 7,948 $ 8,532 A summary of costs incurred by the applicable subsidiaries of 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, 2017 2016 2015 Property management fee expense $ 8,136 $ 7,964 $ 7,445 Asset management fee expense 6,330 6,330 6,292 General, administrative and reimbursable expenses 2,613 2,466 2,593 Leasing and construction management fees 5,198 3,049 6,396 |
Rental Income (Tables)
Rental Income (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Leases [Abstract] | |
Schedule of Future Minimum Base 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, 2017 is as follows (in thousands): 2018 $ 153,020 2019 153,948 2020 150,601 2021 149,381 2022 132,706 Thereafter 629,976 $ 1,369,632 |
Quarterly Financial Informati33
Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 Revenue $ 75,915 $ 76,070 $ 77,067 $ 77,270 Expenses 86,021 84,571 86,204 87,163 Net loss (10,106 ) (8,501 ) (9,137 ) (9,893 ) 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 – redemption measurement adjustment 56 (191 ) 385 229 Series B preferred interest – current dividends 1,644 3,861 3,965 3,965 Series B common interest – allocation of net loss (10,858 ) (11,050 ) (11,738 ) (12,053 ) Net loss attributable to Brookfield DTLA (5,251 ) (5,424 ) (6,052 ) (6,338 ) Series A preferred stock – current dividends 4,637 4,637 4,637 4,637 Net loss available to common interest holders of Brookfield DTLA $ (9,888 ) $ (10,061 ) $ (10,689 ) $ (10,975 ) 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 – 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 ) |
Investments in Real Estate (Tab
Investments in Real Estate (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
SEC Schedule III, Real Estate and Accumulated Depreciation Disclosure [Abstract] | |
Schedule of Real Estate Properties | A summary of information related to Brookfield DTLA’s investments in real estate as of December 31, 2017 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 $ 470,000 $ 41,024 $ 456,363 $ 72,008 $ — $ 41,024 $ 528,371 $ 569,395 $ 53,058 2013 BOA Plaza 400,000 54,163 354,422 44,245 — 54,163 398,667 452,830 96,407 2006 Wells Fargo Center– South Tower 355 S. Grand Avenue 250,000 21,231 401,149 23,956 — 21,231 425,105 446,336 39,351 2013 Gas Company 450,000 20,742 396,159 59,552 — 20,742 455,711 476,453 38,521 2013 EY Plaza (3) 725 S. Figueroa 211,831 47,385 286,982 111,707 — 47,385 398,689 446,074 81,611 2006 777 Tower 777 S. Figueroa 220,000 38,010 303,697 14,770 — 38,010 318,467 356,477 33,517 2013 Miscellaneous — 5,000 — 3,757 — 5,000 3,757 8,757 — $ 2,001,831 $ 227,555 $ 2,198,772 $ 329,995 $ — $ 227,555 $ 2,528,767 $ 2,756,322 $ 342,465 __________ (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, 2017 . (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, 2017 2016 2015 Investments in Real Estate Balance at beginning of year $ 2,740,773 $ 2,675,249 $ 2,619,422 Additions during the year: Improvements 75,847 65,524 57,827 Deductions during the year: Dispositions — — 2,000 Other (1) 60,298 — — Balance at end of year $ 2,756,322 $ 2,740,773 $ 2,675,249 __________ (1) During the year ended December 31, 2017 , the amount reported represents the cost of fully depreciated buildings and improvements and tenant improvements written off during the period. |
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, 2017 2016 2015 Accumulated Depreciation Balance at beginning of year $ 329,149 $ 256,130 $ 189,108 Additions during the year: Depreciation expense 73,614 73,019 67,022 Deductions during the year: Other (1) 60,298 — — Balance at end of year $ 342,465 $ 329,149 $ 256,130 __________ (1) During the year ended December 31, 2017 , the amount reported represents the accumulated depreciation of fully depreciated buildings and improvements and tenant improvements written off during the period. |
Organization and Description 35
Organization and Description of Business - Narrative (Details) | Oct. 15, 2013 | Dec. 31, 2017 | Dec. 31, 2016 |
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 - Investments in Real Estate - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation expense related to investments in real estate | $ 73,600 | $ 73,000 | $ 67,000 |
Impairment of real estate assets | $ 0 | $ 0 | |
Building | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 60 years | ||
Estimated salvage value | 5.00% | ||
Building Improvements | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 7 years | ||
Building Improvements | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 25 years |
Basis of Presentation and Sum37
Basis of Presentation and Summary of Significant Accounting Policies - Rents, Deferred Rents and Other Receivables, Net - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Receivables [Abstract] | |||
Tenant inducments, accumulated amortization | $ 12,500 | $ 9,900 | |
Allowance for doubtful accounts | 206 | 213 | |
(Recovery of) provision for doubtful accounts | $ (7) | $ (271) | $ 103 |
Basis of Presentation and Sum38
Basis of Presentation and Summary of Significant Accounting Policies - Deferred Charges, Net - Narrative (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Deferred leasing costs, accumulated amortization | $ 39.8 | $ 49.6 |
Basis of Presentation and Sum39
Basis of Presentation and Summary of Significant Accounting Policies - Mortgage Loans, Net - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |||
Unamortized discounts and debt issuance costs | $ 10,139 | $ 9,055 | |
Amortization of discounts and debt issuance costs | $ 6,400 | $ 4,329 | $ 5,064 |
Basis of Presentation and Sum40
Basis of Presentation and Summary of Significant Accounting Policies - Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Provision for income taxes | $ 214 | $ 584 | $ 526 |
Net operating loss carryforwards | 243,000 | 174,000 | |
Deferred tax assets | 51,000 | 61,000 | |
Deferred tax assets valuation allowance | 51,000 | 61,000 | |
Deferred tax assets, net of valuation allowance | 0 | 0 | |
Unrecognized tax benefits | $ 0 | $ 0 |
Intangible Assets and Liabili41
Intangible Assets and Liabilities - Summary of Intangible Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Intangible Assets | ||
In-place leases | $ 66,365 | $ 110,519 |
Tenant relationships | 30,078 | 46,248 |
Above-market leases | 31,270 | 39,936 |
Intangible assets, gross | 127,713 | 196,703 |
Less: accumulated amortization | 69,424 | 121,117 |
Intangible assets, net | 58,289 | 75,586 |
Intangible Liabilities | ||
Below-market leases | 59,561 | 76,344 |
Less: accumulated amortization | 43,322 | 54,117 |
Intangible liabilities, net | $ 16,239 | $ 22,227 |
Intangible Assets and Liabili42
Intangible Assets and Liabilities - Schedule of Impact of Intangible Amortization Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Rental income | |||
Acquired Indefinite-lived Intangible Assets and Liabilities [Line Items] | |||
Amortization of intangible assets and liabilities | $ 2,218 | $ 3,465 | $ 2,559 |
Depreciation and amortization expense | |||
Acquired Indefinite-lived Intangible Assets and Liabilities [Line Items] | |||
Amortization of intangible assets and liabilities | $ 13,527 | $ 19,609 | $ 21,159 |
Intangible Assets and Liabili43
Intangible Assets and Liabilities - Schedule of Estimated Future Amortization/Accretion of Intangible Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity | ||
Intangible assets, net | $ 58,289 | $ 75,586 |
Intangible Liabilities, Net, Amortization Income, Fiscal Year Maturity | ||
2,018 | 3,750 | |
2,019 | 3,178 | |
2,020 | 2,972 | |
2,021 | 2,800 | |
2,022 | 2,493 | |
Thereafter | 1,046 | |
Intangible liabilities, net | 16,239 | $ 22,227 |
In-Place Leases | ||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity | ||
2,018 | 6,660 | |
2,019 | 5,617 | |
2,020 | 4,972 | |
2,021 | 4,734 | |
2,022 | 4,022 | |
Thereafter | 5,533 | |
Intangible assets, net | 31,538 | |
Other Intangible Assets | ||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity | ||
2,018 | 5,112 | |
2,019 | 4,306 | |
2,020 | 3,414 | |
2,021 | 3,327 | |
2,022 | 3,049 | |
Thereafter | 7,543 | |
Intangible assets, net | $ 26,751 |
Mortgage Loans - Schedule of De
Mortgage Loans - Schedule of Debt (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||
Total debt, gross | $ 2,001,831 | $ 2,085,859 |
Less: unamortized discounts and debt issuance costs | 10,139 | 9,055 |
Total debt, net | $ 1,991,692 | 2,076,804 |
Variable Rate Debt - Mortgage Loan | Wells Fargo Center - North Tower | ||
Debt Instrument [Line Items] | ||
Contractual maturity date | Apr. 9, 2019 | |
Variable interest rate | 3.73% | |
Total debt, gross | $ 370,000 | 0 |
Variable Rate Debt - Mortgage Loan | Wells Fargo Center - South Tower | ||
Debt Instrument [Line Items] | ||
Contractual maturity date | Dec. 6, 2018 | |
Variable interest rate | 5.09% | |
Total debt, gross | $ 250,000 | 250,000 |
Variable Rate Debt - Mortgage Loan | 777 Tower | ||
Debt Instrument [Line Items] | ||
Contractual maturity date | Nov. 1, 2018 | |
Variable interest rate | 3.55% | |
Total debt, gross | $ 220,000 | 220,000 |
Variable Rate Debt - Mortgage Loan | Figueroa at 7th | ||
Debt Instrument [Line Items] | ||
Contractual maturity date | Feb. 6, 2018 | |
Variable interest rate | 3.68% | |
Total debt, gross | $ 35,000 | 35,000 |
Variable Rate Debt - Mezzanine A Loan | Wells Fargo Center - North Tower | ||
Debt Instrument [Line Items] | ||
Contractual maturity date | Apr. 9, 2019 | |
Variable interest rate | 6.73% | |
Total debt, gross | $ 55,000 | 0 |
Variable Rate Debt - Mezzanine B Loan | Wells Fargo Center - North Tower | ||
Debt Instrument [Line Items] | ||
Contractual maturity date | Apr. 9, 2019 | |
Variable interest rate | 8.48% | |
Total debt, gross | $ 45,000 | 0 |
Variable Rate Loans | ||
Debt Instrument [Line Items] | ||
Total debt, gross | 975,000 | 505,000 |
Floating Rate Debt | ||
Debt Instrument [Line Items] | ||
Total debt, gross | $ 1,151,831 | 685,859 |
Floating Rate Debt | EY Plaza | ||
Debt Instrument [Line Items] | ||
Contractual maturity date | Nov. 27, 2020 | |
Variable interest rate | 3.93% | |
Total debt, gross | $ 176,831 | 180,859 |
Fixed Rate Debt | ||
Debt Instrument [Line Items] | ||
Total debt, gross | $ 850,000 | 850,000 |
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 | 3.47% | |
Total debt, gross | $ 319,000 | 319,000 |
Fixed Rate Debt - Mezzanine Loan | Gas Company Tower | ||
Debt Instrument [Line Items] | ||
Contractual maturity date | Aug. 6, 2021 | |
Fixed interest rate | 6.50% | |
Total debt, gross | $ 131,000 | 131,000 |
Debt Refinanced | Wells Fargo Center - North Tower | ||
Debt Instrument [Line Items] | ||
Total debt, gross | $ 0 | $ 550,000 |
Mortgage Loans - Schedule of 45
Mortgage Loans - Schedule of Debt (Footnote) (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2017USD ($)extension_option | |
Variable Rate Debt - Mortgage Loan | Wells Fargo Center - North Tower | |
Debt Instrument [Line Items] | |
Effective interest rate | 3.73% |
Variable Rate Debt - Mortgage Loan | Wells Fargo Center - North Tower | LIBOR | |
Debt Instrument [Line Items] | |
Basis spread on variable rate | 2.25% |
Cap interest rate | 2.75% |
Number of options to extend | 3 |
Option extension period | 1 year |
Variable Rate Debt - Mortgage Loan | Wells Fargo Center - South Tower | |
Debt Instrument [Line Items] | |
Remaining future advance amount | $ | $ 20 |
Effective interest rate | 5.09% |
Variable Rate Debt - Mortgage Loan | 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 Debt - Mortgage Loan | 777 Tower | |
Debt Instrument [Line Items] | |
Effective interest rate | 3.55% |
Variable Rate Debt - Mortgage Loan | 777 Tower | LIBOR | |
Debt Instrument [Line Items] | |
Basis spread on variable rate | 2.18% |
Cap interest rate | 5.75% |
Number of options to extend | 2 |
Option extension period | 1 year |
Variable Rate Debt - Mortgage Loan | Figueroa at 7th | |
Debt Instrument [Line Items] | |
Effective interest rate | 3.68% |
Variable Rate Debt - Mortgage Loan | Figueroa at 7th | LIBOR | |
Debt Instrument [Line Items] | |
Basis spread on variable rate | 2.25% |
Variable Rate Debt - Mezzanine A Loan | Wells Fargo Center - North Tower | |
Debt Instrument [Line Items] | |
Effective interest rate | 6.73% |
Variable Rate Debt - Mezzanine A Loan | Wells Fargo Center - North Tower | LIBOR | |
Debt Instrument [Line Items] | |
Basis spread on variable rate | 5.25% |
Cap interest rate | 2.75% |
Number of options to extend | 3 |
Option extension period | 1 year |
Variable Rate Debt - Mezzanine B Loan | Wells Fargo Center - North Tower | |
Debt Instrument [Line Items] | |
Effective interest rate | 8.48% |
Variable Rate Debt - Mezzanine B Loan | Wells Fargo Center - North Tower | LIBOR | |
Debt Instrument [Line Items] | |
Basis spread on variable rate | 7.00% |
Cap interest rate | 2.75% |
Number of options to extend | 3 |
Option extension period | 1 year |
Floating Rate Debt | EY Plaza | |
Debt Instrument [Line Items] | |
Effective interest rate | 3.93% |
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 | Feb. 06, 2018USD ($) | Apr. 05, 2017USD ($) | Dec. 31, 2017USD ($)extension_option | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Debt Instrument [Line Items] | |||||
Weighted average interest rate | 4.29% | 4.42% | |||
Net proceeds from refinancing | $ 470,000 | $ 720,000 | $ 0 | ||
Payments of financing costs | 7,484 | 7,412 | $ 43 | ||
Prepayment amount without penalty | 562,800 | ||||
Amount available to be defeased | 400,000 | ||||
Prepaid with penalties | 1,039,000 | ||||
Total debt, gross | $ 2,001,831 | 2,085,859 | |||
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, 2017 and were in compliance with the amounts required by the loan agreements. | ||||
Carrying amount | |||||
Debt Instrument [Line Items] | |||||
Total debt, gross | $ 2,000,000 | ||||
Variable Rate Loans | |||||
Debt Instrument [Line Items] | |||||
Total debt, gross | 975,000 | 505,000 | |||
Fixed Rate Debt | |||||
Debt Instrument [Line Items] | |||||
Total debt, gross | $ 850,000 | 850,000 | |||
Wells Fargo Center - North Tower | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Cap interest rate | 2.75% | ||||
Figueroa at 7th | Variable Rate Debt - Mortgage Loan | |||||
Debt Instrument [Line Items] | |||||
Contractual maturity date | Feb. 6, 2018 | ||||
Total debt, gross | $ 35,000 | 35,000 | |||
Figueroa at 7th | Variable Rate Debt - Mortgage Loan | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 2.25% | ||||
Wells Fargo Center - North Tower | Series B preferred interest | |||||
Debt Instrument [Line Items] | |||||
Additional cash required to refinance debt | $ 82,000 | ||||
Wells Fargo Center - North Tower | Variable Rate Debt - Mortgage Loan | |||||
Debt Instrument [Line Items] | |||||
New mortgage loan principal amount | $ 370,000 | ||||
Contractual maturity date | Apr. 9, 2019 | ||||
Total debt, gross | $ 370,000 | 0 | |||
Wells Fargo Center - North Tower | Variable Rate Debt - Mortgage Loan | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 2.25% | ||||
Cap interest rate | 2.75% | ||||
Number of options to extend | extension_option | 3 | ||||
Extension term of maturity date on loan | 1 year | ||||
Wells Fargo Center - North Tower | Variable Rate Loans | |||||
Debt Instrument [Line Items] | |||||
New mortgage loan principal amount | $ 470,000 | ||||
Wells Fargo Center - North Tower | Fixed Rate Debt | |||||
Debt Instrument [Line Items] | |||||
Debt refinanced or to be refinanced | $ 550,000 | ||||
Repayments of long term debt | 80,000 | ||||
Payments of financing costs | 7,400 | ||||
Wells Fargo Center - North Tower | Variable Rate Debt - Mezzanine A Loan | |||||
Debt Instrument [Line Items] | |||||
New mortgage loan principal amount | $ 55,000 | ||||
Contractual maturity date | Apr. 9, 2019 | ||||
Total debt, gross | $ 55,000 | 0 | |||
Wells Fargo Center - North Tower | Variable Rate Debt - Mezzanine A Loan | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 5.25% | ||||
Cap interest rate | 2.75% | ||||
Number of options to extend | extension_option | 3 | ||||
Extension term of maturity date on loan | 1 year | ||||
Wells Fargo Center - North Tower | Variable Rate Debt - Mezzanine B Loan | |||||
Debt Instrument [Line Items] | |||||
New mortgage loan principal amount | $ 45,000 | ||||
Contractual maturity date | Apr. 9, 2019 | ||||
Total debt, gross | $ 45,000 | 0 | |||
Wells Fargo Center - North Tower | Variable Rate Debt - Mezzanine B Loan | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 7.00% | ||||
Cap interest rate | 2.75% | ||||
Number of options to extend | extension_option | 3 | ||||
Extension term of maturity date on loan | 1 year | ||||
777 Tower | Variable Rate Debt - Mortgage Loan | |||||
Debt Instrument [Line Items] | |||||
Debt refinanced or to be refinanced | $ 220,000 | ||||
Contractual maturity date | Nov. 1, 2018 | ||||
Total debt, gross | $ 220,000 | 220,000 | |||
777 Tower | Variable Rate Debt - Mortgage Loan | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 2.18% | ||||
Cap interest rate | 5.75% | ||||
Number of options to extend | extension_option | 2 | ||||
Extension term of maturity date on loan | 1 year | ||||
Wells Fargo Center - South Tower | Series B preferred interest | |||||
Debt Instrument [Line Items] | |||||
Additional cash required to refinance debt | 20,300 | ||||
Wells Fargo Center - South Tower | Variable Rate Debt - Mortgage Loan | |||||
Debt Instrument [Line Items] | |||||
Debt refinanced or to be refinanced | $ 250,000 | ||||
Contractual maturity date | Dec. 6, 2018 | ||||
Total debt, gross | $ 250,000 | 250,000 | |||
Wells Fargo Center - South Tower | Variable Rate Debt - Mortgage Loan | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 3.69% | ||||
Cap interest rate | 3.00% | ||||
Number of options to extend | extension_option | 3 | ||||
Extension term of maturity date on loan | 1 year | ||||
Subsequent Event | Figueroa at 7th | Variable Rate Debt - Mortgage Loan | |||||
Debt Instrument [Line Items] | |||||
Debt refinanced or to be refinanced | $ 35,000 | ||||
Subsequent Event | Figueroa at 7th | Fixed Rate Debt | |||||
Debt Instrument [Line Items] | |||||
Net proceeds from refinancing | 23,100 | ||||
New mortgage loan principal amount | $ 58,500 | ||||
Fixed interest rate | 3.88% | ||||
Contractual maturity date | Mar. 1, 2023 | ||||
Not Designated as Hedging Instrument | Interest Rate Cap | |||||
Debt Instrument [Line Items] | |||||
Notional amount | $ 960,000 | 490,000 | |||
Not Designated as Hedging Instrument | Interest Rate Cap | Wells Fargo Center - North Tower | |||||
Debt Instrument [Line Items] | |||||
Notional amount | $ 470,000 | ||||
Not Designated as Hedging Instrument | Interest Rate Cap | Wells Fargo Center - North Tower | Variable Rate Debt - Mortgage Loan | |||||
Debt Instrument [Line Items] | |||||
Notional amount | 370,000 | 0 | |||
Not Designated as Hedging Instrument | Interest Rate Cap | Wells Fargo Center - North Tower | Variable Rate Debt - Mezzanine A Loan | |||||
Debt Instrument [Line Items] | |||||
Notional amount | 55,000 | 0 | |||
Not Designated as Hedging Instrument | Interest Rate Cap | Wells Fargo Center - North Tower | Variable Rate Debt - Mezzanine B Loan | |||||
Debt Instrument [Line Items] | |||||
Notional amount | 45,000 | 0 | |||
Not Designated as Hedging Instrument | Interest Rate Cap | 777 Tower | Variable Rate Loans | |||||
Debt Instrument [Line Items] | |||||
Notional amount | 220,000 | 220,000 | |||
Not Designated as Hedging Instrument | Interest Rate Cap | Wells Fargo Center - South Tower | Variable Rate Loans | |||||
Debt Instrument [Line Items] | |||||
Notional amount | $ 270,000 | $ 270,000 |
Mortgage Loans - Schedule of 47
Mortgage Loans - Schedule of Debt Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Disclosure [Abstract] | ||
2,018 | $ 509,231 | |
2,019 | 474,449 | |
2,020 | 168,151 | |
2,021 | 450,000 | |
2,022 | 0 | |
Thereafter | 400,000 | |
Total | $ 2,001,831 | $ 2,085,859 |
Mortgage Loans - Schedule of 48
Mortgage Loans - Schedule of Debt Maturities (Footnote) (Details) $ in Millions | Feb. 06, 2018USD ($) |
Figueroa at 7th | Subsequent Event | Variable Rate Debt - Mortgage Loan | |
Debt Instrument [Line Items] | |
Debt refinanced or to be refinanced | $ 35 |
Mezzanine Equity - Narrative (D
Mezzanine Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | Jan. 04, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Series A preferred stock | ||||
Class of Stock [Line Items] | ||||
Preferred stock dividends paid (in USD per share) | $ 2.25 | |||
Dividend payment | $ 21.9 | |||
Senior Participating Preferred Interest | ||||
Class of Stock [Line Items] | ||||
Distributions to noncontrolling interests | $ 0.5 | $ 0.6 | $ 35.8 |
Mezzanine Equity - Series A Pre
Mezzanine Equity - Series A Preferred Stock - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | Jan. 04, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2014 |
Class of Stock [Line Items] | ||||||
Redemption value | $ 990,749 | $ 829,532 | $ 726,595 | $ 990,749 | $ 739,600 | |
Series A preferred stock | ||||||
Class of Stock [Line Items] | ||||||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | 10,000,000 | |||
Preferred stock, par value (in USD per share) | $ 0.01 | $ 0.01 | $ 0.01 | |||
Preferred stock, liquidation preference (in USD per share) | $ 25 | $ 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) | $ 0 | $ 0 | $ 2.25 | |||
Preferred stock, dividend rate (in USD per share) | $ 1.90625 | |||||
Preferred stock, amount of preferred dividends in arrears | $ 148,100 | |||||
Preferred stock dividends paid (in USD per share) | $ 2.25 | |||||
Dividend payment | $ 21,900 | |||||
Redemption value | $ 391,400 | $ 372,852 | $ 354,304 | $ 391,400 | $ 357,649 | |
Third party issuance | Series A preferred stock | ||||||
Class of Stock [Line Items] | ||||||
Preferred stock, shares outstanding (in shares) | 9,357,469 | 9,357,469 | 9,357,469 | |||
Brookfield DTLA Holdings LLC | Series A preferred stock | ||||||
Class of Stock [Line Items] | ||||||
Preferred stock, shares outstanding (in shares) | 372,901 | 372,901 | 372,901 |
Mezzanine Equity - Series A-1 P
Mezzanine Equity - Series A-1 Preferred Interest - Narrative (Details) - USD ($) $ in Thousands | Oct. 15, 2013 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Class of Stock [Line Items] | |||||
Redemption value | $ 990,749 | $ 829,532 | $ 726,595 | $ 739,600 | |
Series A-1 Preferred Interest | |||||
Class of Stock [Line Items] | |||||
Temporary equity, stated value | $ 225,700 | ||||
Redemption value | 383,510 | $ 366,297 | $ 349,084 | $ 331,871 | |
Liquidation value | 225,700 | ||||
Preferred stock, amount of preferred dividends in arrears | $ 157,800 | ||||
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% |
Mezzanine Equity - Senior Parti
Mezzanine Equity - Senior Participating Preferred Interest - Narrative (Details) - USD ($) $ in Thousands | Oct. 15, 2013 | Mar. 08, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Class of Stock [Line Items] | ||||||
Payments of dividends to noncontrolling interest | $ 0 | $ 0 | $ 3,051 | |||
Other contribution from noncontrolling interest | 111,492 | 63,280 | 0 | |||
Redemption value | 990,749 | 829,532 | 726,595 | $ 739,600 | ||
Senior Participating Preferred Interest | ||||||
Class of Stock [Line Items] | ||||||
Temporary equity, stated value | $ 240,000 | |||||
Coupon rate, preferred interest | 7.00% | |||||
Distributions to noncontrolling interests | 500 | 600 | 35,800 | |||
Payments of dividends to noncontrolling interest | 3,000 | |||||
Other payment to noncontrolling interest | 500 | 600 | 32,800 | |||
Other contribution from noncontrolling interest | 500 | |||||
Redemption value | $ 25,548 | $ 25,019 | $ 23,207 | $ 50,080 | ||
333 South Hope and EYP Realty | Brookfield DTLA Holdings LLC | Senior Participating Preferred Interest | ||||||
Class of Stock [Line Items] | ||||||
Participating interest in residual value | 4.00% | |||||
Subsequent Event | Senior Participating Preferred Interest | ||||||
Class of Stock [Line Items] | ||||||
Other payment to noncontrolling interest | $ 500 |
Mezzanine Equity - Series B Pre
Mezzanine Equity - Series B Preferred Interest - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Oct. 15, 2013 | |
Class of Stock [Line Items] | |||||
Issuance of Series B preferred interest | $ 111,492 | $ 63,280 | $ 0 | ||
Redemption value | 990,749 | 829,532 | 726,595 | $ 739,600 | |
Accumulated and unpaid dividends | 0 | 0 | 21,893 | ||
Series B preferred interest | |||||
Class of Stock [Line Items] | |||||
Maximum funding commitment | $ 260,000 | ||||
Issuance of Series B preferred interest | $ 111,492 | $ 63,280 | 0 | ||
Coupon rate, preferred interest | 9.00% | 9.00% | |||
Redemption value | $ 190,291 | $ 65,364 | $ 0 | $ 0 | |
Liquidation value | 174,800 | ||||
Accumulated and unpaid dividends | 15,500 | ||||
Wells Fargo Center - South Tower | Series B preferred interest | |||||
Class of Stock [Line Items] | |||||
Cash required to refinance debt | 20,300 | ||||
Gas Company Tower | Series B preferred interest | |||||
Class of Stock [Line Items] | |||||
Cash required to refinance debt | $ 19,700 | ||||
Wells Fargo Center - North Tower | Series B preferred interest | |||||
Class of Stock [Line Items] | |||||
Cash required to refinance debt | $ 82,000 |
Mezzanine Equity - Summary of C
Mezzanine Equity - Summary of Change in Mezzanine Equity (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Increase (Decrease) in Temporary Equity [Roll Forward] | |||
Balance, beginning | $ 829,532 | $ 726,595 | $ 739,600 |
Issuance of Series B preferred interest | 111,492 | 63,280 | 0 |
Current dividends | 49,196 | 37,845 | 38,082 |
Redemption measurement adjustment | 479 | 2,428 | 6,626 |
Dividends declared | 0 | 0 | (21,893) |
Cash contribution (distributions), net | 50 | (616) | (35,820) |
Balance, ending | 990,749 | 829,532 | 726,595 |
Series A Preferred Stock | |||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||
Balance, beginning | $ 372,852 | $ 354,304 | $ 357,649 |
Balance, beginning (in shares) | 9,730,370 | 9,730,370 | 9,730,370 |
Current dividends | $ 18,548 | $ 18,548 | $ 18,548 |
Dividends declared | 0 | 0 | (21,893) |
Balance, ending | $ 391,400 | $ 372,852 | $ 354,304 |
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 | $ 366,297 | $ 349,084 | $ 331,871 |
Current dividends | 17,213 | 17,213 | 17,213 |
Balance, ending | 383,510 | 366,297 | 349,084 |
Senior Participating Preferred Interest | |||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||
Balance, beginning | 25,019 | 23,207 | 50,080 |
Current dividends | 0 | 0 | 2,321 |
Redemption measurement adjustment | 479 | 2,428 | 6,626 |
Cash contribution (distributions), net | 50 | (616) | (35,820) |
Balance, ending | 25,548 | 25,019 | 23,207 |
Series B Preferred Interest | |||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||
Balance, beginning | 65,364 | 0 | 0 |
Issuance of Series B preferred interest | 111,492 | 63,280 | 0 |
Current dividends | 13,435 | 2,084 | 0 |
Balance, ending | $ 190,291 | $ 65,364 | $ 0 |
Stockholders' Deficit - Common
Stockholders' Deficit - Common Stock - Narrative (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Equity [Abstract] | |||
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 |
Stockholders' Deficit - Capital
Stockholders' Deficit - Capital Contribution - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Equity [Abstract] | |||
Contribution from Brookfield DTLA Holdings | $ 0 | $ 2,500 | $ 0 |
Accumulated Other Comprehensi57
Accumulated Other Comprehensive Loss - Summary of Change in Accumulated Other Comprehensive Loss Related to Cash Flow Hedges (Details) - Accumulated Other Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accumulated Other Comprehensive Loss [Roll Forward] | |||
Balance at beginning of year | $ (3,373) | $ (5,415) | $ (4,337) |
Other comprehensive income (loss) before reclassifications | 2,799 | 2,042 | (1,078) |
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 | 0 |
Net current-year other comprehensive income (loss) | 2,799 | 2,042 | (1,078) |
Balance at end of year | $ (574) | $ (3,373) | $ (5,415) |
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, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Interest Rate Swap | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||
Interest rate cash flow hedge derivative at fair value, net | $ (574) | $ (3,373) | $ (5,415) |
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 | |||
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 | |||
Interest rate cash flow hedge derivative at fair value, net | (574) | (3,373) | (5,415) |
Interest Rate Swap | Significant Unobservable Inputs (Level 3) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||
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 | |||
Interest rate derivative instruments not designated as hedging instruments, asset at fair value | 15 | 53 | 19 |
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 | |||
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 | |||
Interest rate derivative instruments not designated as hedging instruments, asset at fair value | 15 | 53 | 19 |
Interest Rate Cap | Significant Unobservable Inputs (Level 3) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||
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, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Derivatives, Fair Value | |||
Interest rate cash flow hedge derivative at fair value, net | $ (574) | $ (3,373) | $ (5,415) |
Accounts Payable and Other Liabilities | Cash Flow Hedging | Designated as Hedging Instrument | |||
Derivatives, Fair Value | |||
Interest rate cash flow hedge derivative at fair value, net | $ (574) | $ (3,373) |
Financial Instruments - Summa60
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, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Derivative | |||
Amount of Gain (Loss) Recognized in AOCL | $ 2,799 | $ 2,042 | $ (1,078) |
Amount of Gain (Loss) Reclassified from AOCL to Statement of Operations | $ 0 | $ 0 | $ 0 |
Financial Instruments - Interes
Financial Instruments - Interest Rate Swap - Narrative (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
EY Plaza | Interest Rate Swap | Designated as Hedging Instrument | ||
Derivative | ||
Notional amount | $ 176.8 | $ 180.9 |
Financial Instruments - Schedul
Financial Instruments - Schedule of Interest Rate Derivatives (Details) - Interest Rate Cap - Not Designated as Hedging Instrument - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Derivative Instruments, Interest Rate Caps | ||
Notional amount | $ 960,000 | $ 490,000 |
Wells Fargo Center - North Tower | Variable Rate Debt - Mortgage Loan | ||
Derivative Instruments, Interest Rate Caps | ||
Notional amount | 370,000 | 0 |
Wells Fargo Center - North Tower | Variable Rate Debt - Mezzanine A Loan | ||
Derivative Instruments, Interest Rate Caps | ||
Notional amount | 55,000 | 0 |
Wells Fargo Center - North Tower | Variable Rate Debt - Mezzanine B Loan | ||
Derivative Instruments, Interest Rate Caps | ||
Notional amount | 45,000 | 0 |
Wells Fargo Center - South Tower | Variable Rate Loans | ||
Derivative Instruments, Interest Rate Caps | ||
Notional amount | 270,000 | 270,000 |
777 Tower | Variable Rate Loans | ||
Derivative Instruments, Interest Rate Caps | ||
Notional amount | $ 220,000 | $ 220,000 |
Financial Instruments - Inter63
Financial Instruments - Interest Rate Caps - Narrative (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Apr. 05, 2017 | Dec. 31, 2016 |
Interest Rate Cap | Not Designated as Hedging Instrument | |||
Derivative | |||
Notional amount | $ 960,000 | $ 490,000 | |
Wells Fargo Center - North Tower | LIBOR | |||
Derivative | |||
Cap interest rate | 2.75% | ||
Wells Fargo Center - North Tower | Interest Rate Cap | Not Designated as Hedging Instrument | |||
Derivative | |||
Notional amount | $ 470,000 |
Financial Instruments - Summa64
Financial Instruments - Summary of Estimated Fair Value and Carrying Amount of Mortgage Loans (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Estimated fair value | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Mortgage loans | $ 2,003,600 | $ 2,059,449 |
Carrying amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Mortgage loans | $ 2,001,831 | $ 2,085,859 |
Related Party Transactions - Ma
Related Party Transactions - Management Agreements - Narrative (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Property management fee expense, percentage | 2.75% |
Asset management fee expense, percentage | 0.75% |
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, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property management fee expense | |||
Related Party Transaction | |||
Related party transaction expenses | $ 8,136 | $ 7,964 | $ 7,445 |
Asset management fee expense | |||
Related Party Transaction | |||
Related party transaction expenses | 6,330 | 6,330 | 6,292 |
General, administrative and reimbursable expenses | |||
Related Party Transaction | |||
Related party transaction expenses | 2,613 | 2,466 | 2,593 |
Leasing and construction management fees | |||
Related Party Transaction | |||
Related party transaction expenses | 5,198 | 3,049 | 6,396 |
Insurance expense | |||
Related Party Transaction | |||
Related party transaction expenses | $ 7,795 | $ 7,948 | $ 8,532 |
Related Party Transactions - In
Related Party Transactions - Insurance Agreements - Narrative (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Related Party Transactions [Abstract] | |
Real Estate Insurance, All Risk Property and Business Interruption, Aggregate Limit per Occurrence | $ 2,500 |
Real Estate Insurance, Earthquake, Aggregate Limit | 402.5 |
Real Estate Insurance, Flood and Weather Catastrophe, Aggregate Limit | 372.5 |
Real Estate Insurance, Terrorism Insurance per Occurrence Maximum | $ 4,000 |
Rental Income - Schedule of Fut
Rental Income - Schedule of Future Minimum Base Rental Income Under Noncancelable Tenant Operating Leases (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Leases [Abstract] | |
2,018 | $ 153,020 |
2,019 | 153,948 |
2,020 | 150,601 |
2,021 | 149,381 |
2,022 | 132,706 |
Thereafter | 629,976 |
Total | $ 1,369,632 |
Rental Income - Narrative (Deta
Rental Income - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Leases [Abstract] | |||
Percentage rental income earned | $ 3.1 | $ 2.8 | $ 2.8 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative - Tenant Concentration (Details) - Revenue | 12 Months Ended | ||
Dec. 31, 2017customerProperties | Dec. 31, 2016customerProperties | Dec. 31, 2015customerProperties | |
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% | 100.00% | 98.00% |
Quarterly Financial Informati71
Quarterly Financial Information (Unaudited) - Schedule of Quarterly Financial Information (Unaudited) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Quarterly Financial Information [Line Items] | |||||||||||
Revenue | $ 77,270 | $ 77,067 | $ 76,070 | $ 75,915 | $ 79,503 | $ 77,408 | $ 78,968 | $ 74,813 | $ 306,322 | $ 310,692 | $ 299,090 |
Expenses | 87,163 | 86,204 | 84,571 | 86,021 | 90,042 | 86,802 | 87,230 | 84,785 | 343,959 | 348,859 | 339,444 |
Net loss | (9,893) | (9,137) | (8,501) | (10,106) | (10,539) | (9,394) | (8,262) | (9,972) | (37,637) | (38,167) | (40,354) |
Series B common interest – allocation of net loss | (12,053) | (11,738) | (11,050) | (10,858) | (11,033) | (10,532) | (9,248) | (10,242) | (45,699) | (41,055) | (44,521) |
Net loss attributable to Brookfield DTLA | (6,338) | (6,052) | (5,424) | (5,251) | (5,409) | (4,954) | (3,785) | (4,689) | (23,065) | (18,837) | (21,992) |
Net loss available to common interest holders of Brookfield DTLA | (10,975) | (10,689) | (10,061) | (9,888) | (10,046) | (9,591) | (8,422) | (9,326) | (41,613) | (37,385) | (40,540) |
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 | 2,321 | ||||||||
Redemption measurement adjustment | 229 | 385 | (191) | 56 | 464 | 908 | 400 | 656 | 479 | 2,428 | 6,625 |
Series B preferred interest | |||||||||||
Quarterly Financial Information [Line Items] | |||||||||||
Current dividends | 3,965 | 3,965 | 3,861 | 1,644 | 1,135 | 881 | 68 | 0 | 13,435 | 2,084 | 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, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||||
Encumbrances | $ 2,001,831 | |||||
Initial Cost to Company | ||||||
Land | 227,555 | |||||
Buildings and Improvements | 2,198,772 | |||||
Costs Capitalized Subsequent to Acquisition | ||||||
Improvements | 329,995 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 227,555 | |||||
Buildings and Improvements | 2,528,767 | |||||
Total | 2,756,322 | $ 2,740,773 | $ 2,675,249 | $ 2,619,422 | ||
Accumulated Depreciation | 342,465 | $ 329,149 | $ 256,130 | $ 189,108 | ||
Office properties | Wells Fargo Center – North Tower 333 S. Grand Avenue | ||||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||||
Encumbrances | 470,000 | |||||
Initial Cost to Company | ||||||
Land | 41,024 | |||||
Buildings and Improvements | 456,363 | |||||
Costs Capitalized Subsequent to Acquisition | ||||||
Improvements | 72,008 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 41,024 | |||||
Buildings and Improvements | 528,371 | |||||
Total | 569,395 | |||||
Accumulated Depreciation | 53,058 | |||||
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 | 44,245 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 54,163 | |||||
Buildings and Improvements | 398,667 | |||||
Total | 452,830 | |||||
Accumulated Depreciation | 96,407 | |||||
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 | 23,956 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 21,231 | |||||
Buildings and Improvements | 425,105 | |||||
Total | 446,336 | |||||
Accumulated Depreciation | 39,351 | |||||
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 | 59,552 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 20,742 | |||||
Buildings and Improvements | 455,711 | |||||
Total | 476,453 | |||||
Accumulated Depreciation | 38,521 | |||||
Year Acquired | Oct. 15, 2013 | |||||
Office properties | EY Plaza 725 S. Figueroa Street | ||||||
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | ||||||
Encumbrances | 211,831 | |||||
Initial Cost to Company | ||||||
Land | 47,385 | |||||
Buildings and Improvements | 286,982 | |||||
Costs Capitalized Subsequent to Acquisition | ||||||
Improvements | 111,707 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 47,385 | |||||
Buildings and Improvements | 398,689 | |||||
Total | 446,074 | |||||
Accumulated Depreciation | 81,611 | |||||
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 | 14,770 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 38,010 | |||||
Buildings and Improvements | 318,467 | |||||
Total | 356,477 | |||||
Accumulated Depreciation | 33,517 | |||||
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 | 3,757 | |||||
Carrying Costs | 0 | |||||
Gross Amount at Which Carried at Close of Period | ||||||
Land | 5,000 | |||||
Buildings and Improvements | 3,757 | |||||
Total | 8,757 | |||||
Accumulated Depreciation | $ 0 |
Investments in Real Estate - 73
Investments in Real Estate - Summary of Information Related to Investments in Real Estate (Footnote) (Details) $ in Billions | 12 Months Ended |
Dec. 31, 2017USD ($) | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Real estate for federal income tax purposes | $ 2.7 |
Buildings | |
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, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Investments in Real Estate | |||
Balance at beginning of year | $ 2,740,773 | $ 2,675,249 | $ 2,619,422 |
Improvements | 75,847 | 65,524 | 57,827 |
Dispositions | 0 | 0 | 2,000 |
Other (1) | 60,298 | 0 | 0 |
Balance at end of year | 2,756,322 | 2,740,773 | 2,675,249 |
Accumulated Depreciation | |||
Balance at beginning of year | 329,149 | 256,130 | 189,108 |
Depreciation expense | 73,614 | 73,019 | 67,022 |
Other (1) | 60,298 | 0 | 0 |
Balance at end of year | $ 342,465 | $ 329,149 | $ 256,130 |
Subsequent Events - Refinancing
Subsequent Events - Refinancing of Figueroa at 7th Mortgage Loan - Narrative (Details) - USD ($) $ in Thousands | Feb. 06, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Subsequent Event | ||||
Net proceeds from refinancing | $ 470,000 | $ 720,000 | $ 0 | |
Variable Rate Debt - Mortgage Loan | Figueroa at 7th | ||||
Subsequent Event | ||||
Maturity date of new mortgage loan | Feb. 6, 2018 | |||
Variable Rate Debt - Mortgage Loan | Figueroa at 7th | Subsequent Event | ||||
Subsequent Event | ||||
Debt refinanced or to be refinanced | $ 35,000 | |||
Fixed Rate Debt | Figueroa at 7th | Subsequent Event | ||||
Subsequent Event | ||||
Net proceeds from refinancing | 23,100 | |||
New mortgage loan principal amount | $ 58,500 | |||
Fixed interest rate | 3.88% | |||
Maturity date of new mortgage loan | Mar. 1, 2023 |
Subsequent Events - Distributio
Subsequent Events - Distributions to Brookfield DTLA Holdings - Narrative (Details) - Senior participating preferred interest - USD ($) $ in Millions | 2 Months Ended | 12 Months Ended | ||
Mar. 08, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Subsequent Event | ||||
Distributions to senior participating preferred interest | $ 0.5 | $ 0.6 | $ 32.8 | |
Subsequent Event | ||||
Subsequent Event | ||||
Distributions to senior participating preferred interest | $ 0.5 |