Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | Apr. 18, 2014 | |
Entity Information [Line Items] | ' | ' |
Entity Registrant Name | 'CORPORATE OFFICE PROPERTIES TRUST | ' |
Entity Central Index Key | '0000860546 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 87,607,331 |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Corporate Office Properties, L.P. | ' | ' |
Entity Information [Line Items] | ' | ' |
Entity Registrant Name | 'CORPORATE OFFICE PROPERTIES, L.P. | ' |
Entity Central Index Key | '0001577966 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Non-accelerated Filer | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Properties, net: | ' | ' |
Operating properties, net | $2,729,003 | $2,702,693 |
Projects in development or held for future development | 495,625 | 511,608 |
Total properties, net | 3,224,628 | 3,214,301 |
Cash and cash equivalents | 18,374 | 54,373 |
Restricted cash and marketable securities | 10,965 | 11,448 |
Accounts receivable (net of allowance for doubtful accounts of $2,353 and $2,976, respectively) | 30,152 | 27,000 |
Deferred rent receivable (net of allowance of $1,495 and $2,126, respectively) | 91,082 | 89,456 |
Intangible assets on real estate acquisitions, net | 55,678 | 59,258 |
Deferred leasing and financing costs, net | 65,855 | 66,267 |
Mortgage and other investing receivables | 55,231 | 53,663 |
Prepaid expenses and other assets | 53,932 | 54,186 |
Total assets | 3,605,897 | 3,629,952 |
Liabilities: | ' | ' |
Debt, net | 1,931,831 | 1,927,703 |
Accounts payable and accrued expenses | 97,451 | 98,785 |
Rents received in advance and security deposits | 28,267 | 31,492 |
Dividends and distributions payable | 29,122 | 29,080 |
Deferred revenue associated with operating leases | 12,281 | 10,369 |
Interest rate derivatives | 3,196 | 3,309 |
Other liabilities | 13,060 | 14,207 |
Total liabilities | 2,115,208 | 2,114,945 |
Commitments and contingencies (Note 17) | ' | ' |
Redeemable noncontrolling interest | 17,654 | 17,758 |
Corporate Office Properties Trust’s shareholders’ equity: | ' | ' |
Preferred Shares of beneficial interest at liquidation preference ($0.01 par value; 25,000,000 shares authorized; 9,431,667 shares issued and outstanding) | 249,083 | 249,083 |
Common Shares of beneficial interest | 876 | 874 |
Additional paid-in capital | 1,816,467 | 1,814,015 |
Cumulative distributions in excess of net income | -665,708 | -641,868 |
Accumulated other comprehensive income | 2,072 | 3,480 |
Total Corporate Office Properties Trust’s shareholders’ equity | 1,402,790 | 1,425,584 |
Noncontrolling interests in subsidiaries: | ' | ' |
Common units in COPLP | 51,757 | 53,468 |
Preferred units in COPLP | 8,800 | 8,800 |
Other consolidated entities | 9,688 | 9,397 |
Noncontrolling interests in subsidiaries | 70,245 | 71,665 |
Total equity | 1,473,035 | 1,497,249 |
Total liabilities, redeemable noncontrolling interest and equity | 3,605,897 | 3,629,952 |
Corporate Office Properties, L.P. | ' | ' |
Properties, net: | ' | ' |
Operating properties, net | 2,729,003 | 2,702,693 |
Projects in development or held for future development | 495,625 | 511,608 |
Total properties, net | 3,224,628 | 3,214,301 |
Cash and cash equivalents | 18,374 | 54,373 |
Restricted cash and marketable securities | 3,400 | 3,981 |
Accounts receivable (net of allowance for doubtful accounts of $2,353 and $2,976, respectively) | 30,152 | 27,000 |
Deferred rent receivable (net of allowance of $1,495 and $2,126, respectively) | 91,082 | 89,456 |
Intangible assets on real estate acquisitions, net | 55,678 | 59,258 |
Deferred leasing and financing costs, net | 65,855 | 66,267 |
Mortgage and other investing receivables | 55,231 | 53,663 |
Prepaid expenses and other assets | 53,932 | 54,186 |
Total assets | 3,598,332 | 3,622,485 |
Liabilities: | ' | ' |
Debt, net | 1,931,831 | 1,927,703 |
Accounts payable and accrued expenses | 97,451 | 98,785 |
Rents received in advance and security deposits | 28,267 | 31,492 |
Dividends and distributions payable | 29,122 | 29,080 |
Deferred revenue associated with operating leases | 12,281 | 10,369 |
Interest rate derivatives | 3,196 | 3,309 |
Other liabilities | 5,495 | 6,740 |
Total liabilities | 2,107,643 | 2,107,478 |
Commitments and contingencies (Note 17) | ' | ' |
Redeemable noncontrolling interest | 17,654 | 17,758 |
Corporate Office Properties Trust’s shareholders’ equity: | ' | ' |
Common Shares of beneficial interest | 1,203,297 | 1,226,318 |
Accumulated other comprehensive income | 2,133 | 3,605 |
Total Corporate Office Properties Trust’s shareholders’ equity | 1,463,313 | 1,487,806 |
Noncontrolling interests in subsidiaries: | ' | ' |
Noncontrolling interests in subsidiaries | 9,722 | 9,443 |
Total equity | 1,473,035 | 1,497,249 |
Total liabilities, redeemable noncontrolling interest and equity | 3,598,332 | 3,622,485 |
Corporate Office Properties, L.P. | General Partner | ' | ' |
Corporate Office Properties Trust’s shareholders’ equity: | ' | ' |
Preferred partners' capital accounts | 249,083 | 249,083 |
Corporate Office Properties, L.P. | Limited Partner | ' | ' |
Corporate Office Properties Trust’s shareholders’ equity: | ' | ' |
Preferred partners' capital accounts | $8,800 | $8,800 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ' | ' |
Allowance for doubtful accounts - AR | $2,353 | $2,976 |
Allowance - Deferred rent receivable | $1,495 | $2,126 |
Preferred Shares of beneficial interest, par value (in dollars per share) | $0.01 | $0.01 |
Preferred Shares of beneficial interest, shares authorized | 25,000,000 | 25,000,000 |
Preferred Shares of beneficial interest, shares issued | 9,431,667 | 9,431,667 |
Preferred Shares of beneficial interest, shares outstanding | 9,431,667 | 9,431,667 |
Common Shares of beneficial interest, par value (in dollars per share) | $0.01 | $0.01 |
Common Shares of beneficial interest, shares authorized | 125,000,000 | 125,000,000 |
Common Shares of beneficial interest, shares issued | 87,594,931 | 87,394,512 |
Common Shares of beneficial interest, shares outstanding | 87,594,931 | 87,394,512 |
Consolidated_Balance_Sheets_Pa1
Consolidated Balance Sheets (Parenthetical 2) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Allowance for doubtful accounts - AR | $2,353 | $2,976 |
Allowance - Deferred rent receivable | 1,495 | 2,126 |
Common Shares of beneficial interest, shares outstanding | 87,594,931 | 87,394,512 |
Corporate Office Properties, L.P. | ' | ' |
Allowance for doubtful accounts - AR | 2,353 | 2,976 |
Allowance - Deferred rent receivable | $1,495 | $2,226 |
Corporate Office Properties, L.P. | General Partner | ' | ' |
Preferred Units, Outstanding | 9,431,667 | 9,431,667 |
Common Shares of beneficial interest, shares outstanding | 87,594,931 | 87,394,512 |
Corporate Office Properties, L.P. | Limited Partner | ' | ' |
Preferred Units, Outstanding | 352,000 | 352,000 |
Common Shares of beneficial interest, shares outstanding | 3,929,202 | 3,977,700 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 3 Months Ended | |||
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | ||
Revenues | ' | ' | ||
Rental revenue | $98,035 | $91,849 | ||
Tenant recoveries and other real estate operations revenue | 26,842 | 20,108 | ||
Construction contract and other service revenues | 21,790 | 14,262 | ||
Total revenues | 146,667 | 126,219 | ||
Expenses | ' | ' | ||
Property operating expenses | 49,772 | 40,388 | ||
Depreciation and amortization associated with real estate operations | 43,596 | 27,010 | ||
Construction contract and other service expenses | 18,624 | 13,477 | ||
General, administrative and leasing expenses | 8,143 | 7,820 | ||
Business development expenses and land carry costs | 1,326 | 1,359 | ||
Total operating expenses | 121,461 | 90,054 | ||
Operating income | 25,206 | 36,165 | ||
Interest expense | -20,827 | -20,290 | ||
Interest and other income | 1,285 | 946 | ||
Loss on early extinguishment of debt | 0 | -5,184 | ||
Income from continuing operations before equity in income of unconsolidated entities and income taxes | 5,664 | 11,637 | ||
Equity in income of unconsolidated entities | 60 | 41 | ||
Income tax expense | -64 | -16 | ||
Income from continuing operations | 5,660 | 11,662 | ||
Discontinued operations | 11 | 1,261 | ||
Income before gain on sales of real estate | 5,671 | 12,923 | ||
Gain on sales of real estate | 0 | 2,354 | ||
Net income | 5,671 | 15,277 | ||
Net (income) loss attributable to noncontrolling interests: | ' | ' | ||
Common units in COPLP | -16 | -429 | ||
Preferred units in COPLP | -165 | -165 | ||
Other consolidated entities | -749 | 337 | ||
Net income attributable to COPT | 4,741 | 15,020 | ||
Preferred share/unit dividends/distributions | -4,490 | -6,106 | ||
Net income attributable to COPT common shareholders | 251 | 8,914 | ||
Net income attributable to COPT: | ' | ' | ||
Income from continuing operations | 4,728 | 13,849 | ||
Discontinued operations, net | 13 | 1,171 | ||
Net income attributable to COPT | 4,741 | 15,020 | ||
Basic earnings per common share (1) | ' | ' | ||
Income from continuing operations (in dollars per share/unit) | $0 | [1] | $0.09 | [1] |
Discontinued operations (in dollars per share/unit) | $0 | [1] | $0.02 | [1] |
Net income attributable to COPT common shareholders (in dollars per share/unit) | $0 | [1] | $0.11 | [1] |
Diluted earnings per common share (1) | ' | ' | ||
Income from continuing operations (in dollars per share/unit) | $0 | [1] | $0.09 | [1] |
Discontinued operations (in dollars per share/unit) | $0 | [1] | $0.02 | [1] |
Net income attributable to COPT common shareholders (in dollars per share/unit) | $0 | [1] | $0.11 | [1] |
Dividends/distributions declared per common share/unit | $0.28 | $0.28 | ||
Corporate Office Properties, L.P. | ' | ' | ||
Revenues | ' | ' | ||
Rental revenue | 98,035 | 91,849 | ||
Tenant recoveries and other real estate operations revenue | 26,842 | 20,108 | ||
Construction contract and other service revenues | 21,790 | 14,262 | ||
Total revenues | 146,667 | 126,219 | ||
Expenses | ' | ' | ||
Property operating expenses | 49,772 | 40,388 | ||
Depreciation and amortization associated with real estate operations | 43,596 | 27,010 | ||
Construction contract and other service expenses | 18,624 | 13,477 | ||
General, administrative and leasing expenses | 8,143 | 7,820 | ||
Business development expenses and land carry costs | 1,326 | 1,359 | ||
Total operating expenses | 121,461 | 90,054 | ||
Operating income | 25,206 | 36,165 | ||
Interest expense | -20,827 | -20,290 | ||
Interest and other income | 1,285 | 946 | ||
Loss on early extinguishment of debt | 0 | -5,184 | ||
Income from continuing operations before equity in income of unconsolidated entities and income taxes | 5,664 | 11,637 | ||
Equity in income of unconsolidated entities | 60 | 41 | ||
Income tax expense | -64 | -16 | ||
Income from continuing operations | 5,660 | 11,662 | ||
Discontinued operations | 11 | 1,261 | ||
Income before gain on sales of real estate | 5,671 | 12,923 | ||
Gain on sales of real estate | 0 | 2,354 | ||
Net income | 5,671 | 15,277 | ||
Net (income) loss attributable to noncontrolling interests: | ' | ' | ||
Net (income) loss attributable to noncontrolling interests in consolidated entities | -737 | 336 | ||
Net income attributable to COPT | 4,934 | 15,613 | ||
Preferred share/unit dividends/distributions | -4,655 | -6,271 | ||
Net income attributable to COPT common shareholders | 279 | 9,342 | ||
Net income attributable to COPT: | ' | ' | ||
Income from continuing operations | 4,921 | 14,385 | ||
Discontinued operations, net | 13 | 1,228 | ||
Net income attributable to COPT | $4,934 | $15,613 | ||
Basic earnings per common share (1) | ' | ' | ||
Income from continuing operations (in dollars per share/unit) | $0 | [2] | $0.09 | [2] |
Discontinued operations (in dollars per share/unit) | $0 | [2] | $0.02 | [2] |
Net income attributable to COPT common shareholders (in dollars per share/unit) | $0 | [2] | $0.11 | [2] |
Diluted earnings per common share (1) | ' | ' | ||
Income from continuing operations (in dollars per share/unit) | $0 | [2] | $0.09 | [2] |
Discontinued operations (in dollars per share/unit) | $0 | [2] | $0.02 | [2] |
Net income attributable to COPT common shareholders (in dollars per share/unit) | $0 | [2] | $0.11 | [2] |
Dividends/distributions declared per common share/unit | $0.28 | $0.28 | ||
[1] | Basic and diluted earnings per common share are calculated based on amounts attributable to common shareholders of Corporate Office Properties Trust. | |||
[2] | Basic and diluted earnings per common unit are calculated based on amounts attributable to common unitholders of Corporate Office Properties, L.P. |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Net income | $5,671 | $15,277 |
Other comprehensive income | ' | ' |
Unrealized (losses) gains on interest rate derivatives | -2,123 | 462 |
Losses on interest rate derivatives included in interest expense | 695 | 658 |
Other comprehensive (loss) income | -1,428 | 1,120 |
Comprehensive income | 4,243 | 16,397 |
Comprehensive (income) loss attributable to noncontrolling interests | -911 | -352 |
Comprehensive income attributable to COPT | 3,332 | 16,045 |
Corporate Office Properties, L.P. | ' | ' |
Net income | 5,671 | 15,277 |
Other comprehensive income | ' | ' |
Unrealized (losses) gains on interest rate derivatives | -2,123 | 462 |
Losses on interest rate derivatives included in interest expense | 695 | 658 |
Other comprehensive (loss) income | -1,428 | 1,120 |
Comprehensive income | 4,243 | 16,397 |
Comprehensive (income) loss attributable to noncontrolling interests | -782 | 290 |
Comprehensive income attributable to COPT | $3,461 | $16,687 |
Consolidated_Statements_of_Equ
Consolidated Statements of Equity (USD $) | Total | Preferred Shares | Common Shares | Additional Paid-in Capital | Cumulative Distributions in Excess of Net Income | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interests | Corporate Office Properties, L.P. | Corporate Office Properties, L.P. | Corporate Office Properties, L.P. | Corporate Office Properties, L.P. | Corporate Office Properties, L.P. | Corporate Office Properties, L.P. | Corporate Office Properties, L.P. | Corporate Office Properties, L.P. |
In Thousands, except Share data, unless otherwise specified | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | Common Shares | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interests | Limited Partner | Limited Partner | General Partner | General Partner |
USD ($) | USD ($) | USD ($) | Preferred Shares | Preferred Shares | |||||||||||
USD ($) | USD ($) | ||||||||||||||
Balance at Dec. 31, 2012 | $1,436,499 | $333,833 | $809 | $1,653,672 | ($617,455) | ($5,435) | $71,075 | $1,436,499 | $1,089,391 | ($5,708) | $10,183 | ' | $8,800 | ' | $333,833 |
Balance (in units/ shares) at Dec. 31, 2012 | 80,952,986 | ' | ' | ' | ' | ' | ' | ' | 85,020,528 | ' | ' | ' | ' | ' | ' |
Balance (preferred units) at Dec. 31, 2012 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 352,000 | ' | 12,821,667 |
Increase (Decrease) in Shareholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Conversion of common units to common shares (248,644 and 48,498 for the three months ended March 31, 2013 and 2014, respectively) | ' | ' | 3 | 3,172 | ' | ' | -3,175 | ' | ' | ' | ' | ' | ' | ' | ' |
Shares issued to the public (in dollars) | 117,913 | ' | 45 | 117,868 | ' | ' | ' | -117,913 | 117,913 | ' | ' | ' | ' | ' | ' |
Shares issued to the public (in units/ shares) | ' | ' | ' | ' | ' | ' | ' | ' | 4,485,000 | ' | ' | ' | ' | ' | ' |
Exercise of share options (in units/shares) | 16,453 | ' | ' | ' | ' | ' | ' | ' | 16,453 | ' | ' | ' | ' | ' | ' |
Exercise of share options (in dollars) | 301 | ' | ' | 301 | ' | ' | ' | 301 | 301 | ' | ' | ' | ' | ' | ' |
Share-based compensation (in units/shares) | ' | ' | ' | ' | ' | ' | ' | ' | 116,315 | ' | ' | ' | ' | ' | ' |
Share-based compensation | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based compensation | ' | ' | ' | 1,999 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based compensation | 2,000 | ' | ' | ' | ' | ' | ' | 2,000 | 2,000 | ' | ' | ' | ' | ' | ' |
Restricted common units/shares redemptions | -60,960 | ' | ' | ' | ' | ' | ' | ' | -60,960 | ' | ' | ' | ' | ' | ' |
Restricted common units/shares redemptions (in dollars) | -1,576 | ' | ' | -1,576 | ' | ' | ' | -1,576 | -1,576 | ' | ' | ' | ' | ' | ' |
Adjustments to noncontrolling interests resulting from changes in ownership of COPLP | ' | ' | ' | -2,229 | ' | ' | 2,229 | ' | ' | ' | ' | ' | ' | ' | ' |
Comprehensive income (loss) | 17,187 | ' | ' | ' | 15,020 | 1,025 | 1,142 | 17,187 | 9,342 | 1,074 | 500 | ' | 165 | ' | 6,106 |
Dividends/Distributions | -29,699 | ' | ' | ' | -29,699 | ' | ' | -30,914 | -24,643 | ' | ' | ' | -165 | ' | -6,106 |
Distributions to owners of common and preferred units in COPLP | -1,215 | ' | ' | ' | ' | ' | -1,215 | ' | ' | ' | ' | ' | ' | ' | ' |
Contributions from noncontrolling interests in other consolidated entities | 85 | ' | ' | 0 | ' | ' | 85 | 85 | ' | ' | 85 | ' | ' | ' | ' |
Adjustment to arrive at fair value of redeemable noncontrolling interest | -848 | ' | ' | -848 | ' | ' | ' | -848 | -848 | ' | ' | ' | ' | ' | ' |
Tax loss from share-based compensation | -104 | ' | ' | -104 | ' | ' | ' | -104 | -104 | ' | ' | ' | ' | ' | ' |
Balance at Mar. 31, 2013 | 1,540,543 | 333,833 | 858 | 1,772,255 | -632,134 | -4,410 | 70,141 | 1,540,543 | 1,191,776 | -4,634 | 10,768 | ' | 8,800 | ' | 333,833 |
Balance (in units/ shares) at Mar. 31, 2013 | 85,758,438 | ' | ' | ' | ' | ' | ' | ' | 89,577,336 | ' | ' | ' | ' | ' | ' |
Balance (preferred units) at Mar. 31, 2013 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 352,000 | ' | 12,821,667 |
Balance at Dec. 31, 2013 | 1,497,249 | 249,083 | 874 | 1,814,015 | -641,868 | 3,480 | 71,665 | 1,497,249 | 1,226,318 | 3,605 | 9,443 | ' | 8,800 | ' | 249,083 |
Balance (in units/ shares) at Dec. 31, 2013 | 87,394,512 | ' | ' | ' | ' | ' | ' | ' | 91,372,212 | ' | ' | 3,977,700 | ' | 87,394,512 | ' |
Balance (preferred units) at Dec. 31, 2013 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 352,000 | 352,000 | 9,431,667 | 9,431,667 |
Increase (Decrease) in Shareholders' Equity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Conversion of common units to common shares (248,644 and 48,498 for the three months ended March 31, 2013 and 2014, respectively) | ' | ' | ' | 651 | ' | ' | -651 | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise of share options (in units/shares) | 26,614 | ' | ' | ' | ' | ' | ' | ' | 26,614 | ' | ' | ' | ' | ' | ' |
Exercise of share options (in dollars) | 568 | ' | ' | 568 | ' | ' | ' | 568 | 568 | ' | ' | ' | ' | ' | ' |
Share-based compensation (in units/shares) | ' | ' | ' | ' | ' | ' | ' | ' | 166,272 | ' | ' | ' | ' | ' | ' |
Share-based compensation | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based compensation | ' | ' | ' | 1,854 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based compensation | 1,856 | ' | ' | ' | ' | ' | ' | 1,856 | 1,856 | ' | ' | ' | ' | ' | ' |
Restricted common units/shares redemptions | -40,965 | ' | ' | ' | ' | ' | ' | ' | -40,965 | ' | ' | ' | ' | ' | ' |
Restricted common units/shares redemptions (in dollars) | -1,092 | ' | ' | -1,092 | ' | ' | ' | -1,092 | -1,092 | ' | ' | ' | ' | ' | ' |
Adjustments to noncontrolling interests resulting from changes in ownership of COPLP | ' | ' | ' | -69 | ' | ' | 69 | ' | ' | ' | ' | ' | ' | ' | ' |
Comprehensive income (loss) | 3,741 | ' | ' | ' | 4,741 | -1,408 | 408 | 3,741 | 279 | -1,472 | 279 | ' | 165 | ' | 4,490 |
Dividends/Distributions | -28,581 | ' | ' | ' | -28,581 | ' | ' | -29,827 | -25,172 | ' | ' | ' | -165 | ' | -4,490 |
Distributions to owners of common and preferred units in COPLP | -1,246 | ' | ' | ' | ' | ' | -1,246 | ' | ' | ' | ' | ' | ' | ' | ' |
Adjustment to arrive at fair value of redeemable noncontrolling interest | 540 | ' | ' | 540 | ' | ' | ' | 540 | 540 | ' | ' | ' | ' | ' | ' |
Balance at Mar. 31, 2014 | $1,473,035 | $249,083 | $876 | $1,816,467 | ($665,708) | $2,072 | $70,245 | $1,473,035 | $1,203,297 | $2,133 | $9,722 | ' | $8,800 | ' | $249,083 |
Balance (in units/ shares) at Mar. 31, 2014 | 87,594,931 | ' | ' | ' | ' | ' | ' | ' | 91,524,133 | ' | ' | 3,929,202 | ' | 87,594,931 | ' |
Balance (preferred units) at Mar. 31, 2014 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 352,000 | 352,000 | 9,431,667 | 9,431,667 |
Consolidated_Statements_of_Equ1
Consolidated Statements of Equity (Parenthetical) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Balance (in units/ shares) | 87,594,931 | 85,758,438 |
Conversion of common units to common shares | 48,498 | 248,644 |
Exercise of share options (in units/shares) | 26,614 | 16,453 |
Restricted common units/shares redemptions | 40,965 | 60,960 |
Common Shares | ' | ' |
Shares issued to the public (in units/ shares) | 0 | 4,485,000 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Cash flows from operating activities | ' | ' |
Revenues from real estate operations received | $116,386 | $119,348 |
Construction contract and other service revenues received | 17,289 | 15,695 |
Property operating expenses paid | -42,739 | -38,865 |
Construction contract and other service expenses paid | -11,397 | -15,588 |
General, administrative, leasing, business development and land carry costs paid | -9,906 | -8,521 |
Interest expense paid | -18,403 | -18,018 |
Previously accreted interest expense paid | 0 | -2,263 |
Payments in connection with early extinguishment of debt | -101 | -4,803 |
Interest and other income received | 217 | 320 |
Income taxes refund | 192 | 6 |
Net cash provided by operating activities | 51,538 | 47,311 |
Cash flows from investing activities | ' | ' |
Construction, development and redevelopment | -42,625 | -44,361 |
Tenant improvements on operating properties | -4,357 | -5,263 |
Other capital improvements on operating properties | -9,115 | -9,327 |
Mortgage and other loan receivables funded | -395 | -2,231 |
Leasing costs paid | -4,422 | -3,436 |
Other | 59 | 4,442 |
Net cash used in investing activities | -60,855 | -60,176 |
Proceeds from debt | ' | ' |
Revolving Credit Facility | 0 | 99,000 |
Other debt proceeds | 5,700 | 68,132 |
Repayments of debt | ' | ' |
Revolving Credit Facility | 0 | -99,000 |
Scheduled principal amortization | -1,855 | -2,512 |
Other debt repayments | -50 | -125,877 |
Deferred financing costs paid | -9 | -1,109 |
Net proceeds from issuance of common shares/units | 568 | 118,389 |
Common share/unit dividends/distributions paid | -24,036 | -22,276 |
Preferred share/unit dividends/distributions paid | -4,490 | -6,106 |
Distributions paid to noncontrolling interests in COPLP | -1,253 | -1,370 |
Restricted share redemptions | -1,092 | -1,576 |
Other | -165 | 85 |
Net cash (used in) provided by financing activities | -26,682 | 25,780 |
Net (decrease) increase in cash and cash equivalents | -35,999 | 12,915 |
Cash and cash equivalents | ' | ' |
Beginning of period | 54,373 | 10,594 |
End of period | 18,374 | 23,509 |
Reconciliation of net income to net cash provided by operating activities: | ' | ' |
Net income | 5,671 | 15,277 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and other amortization | 44,101 | 28,782 |
Impairment losses | 1 | 1,857 |
Settlement of previously accreted interest expense | 0 | -2,263 |
Amortization of deferred financing costs | 1,167 | 1,528 |
Decrease (increase) in deferred rent receivable | 398 | -4,236 |
Amortization of net debt discounts | 171 | 710 |
Loss (gain) on sales of real estate | 4 | -2,354 |
Share-based compensation | 1,555 | 1,649 |
Loss on early extinguishment of debt | -78 | 381 |
Other | -1,032 | -580 |
Changes in operating assets and liabilities: | ' | ' |
(Increase) decrease in accounts receivable | -1,769 | 6,342 |
Decrease in restricted cash and marketable securities | 283 | 201 |
(Increase) decrease in prepaid expenses and other assets | -494 | 4,180 |
Increase (decrease) in accounts payable, accrued expenses and other liabilities | 4,785 | -2,555 |
Decrease in rents received in advance and security deposits | -3,225 | -1,608 |
Net cash provided by operating activities | 51,538 | 47,311 |
Supplemental schedule of non-cash investing and financing activities: | ' | ' |
Decrease in accrued capital improvements, leasing and other investing activity costs | -7,985 | -5,353 |
(Decrease) increase in fair value of derivatives applied to accumulated other comprehensive income (loss) and noncontrolling interests | -1,443 | 1,105 |
Dividends and distributions payable | 29,122 | 29,947 |
Decrease in noncontrolling interests and increase in shareholders’ equity in connection with the conversion of common units into common shares | 651 | 3,175 |
Adjustments to noncontrolling interests resulting from changes in COPLP ownership | 69 | 2,229 |
(Decrease) increase in redeemable noncontrolling interest and (increase) decrease in shareholders’ equity to carry redeemable noncontrolling interest at fair value | -540 | 848 |
Corporate Office Properties, L.P. | ' | ' |
Cash flows from operating activities | ' | ' |
Revenues from real estate operations received | 116,386 | 119,348 |
Construction contract and other service revenues received | 17,289 | 15,695 |
Property operating expenses paid | -42,739 | -38,865 |
Construction contract and other service expenses paid | -11,397 | -15,588 |
General, administrative, leasing, business development and land carry costs paid | -9,906 | -8,521 |
Interest expense paid | -18,403 | -18,018 |
Previously accreted interest expense paid | 0 | -2,263 |
Payments in connection with early extinguishment of debt | -101 | -4,803 |
Interest and other income received | 217 | 320 |
Income taxes refund | 192 | 6 |
Net cash provided by operating activities | 51,538 | 47,311 |
Cash flows from investing activities | ' | ' |
Construction, development and redevelopment | -42,625 | -44,361 |
Tenant improvements on operating properties | -4,357 | -5,263 |
Other capital improvements on operating properties | -9,115 | -9,327 |
Mortgage and other loan receivables funded | -395 | -2,231 |
Leasing costs paid | -4,422 | -3,436 |
Other | 59 | 4,442 |
Net cash used in investing activities | -60,855 | -60,176 |
Proceeds from debt | ' | ' |
Revolving Credit Facility | 0 | 99,000 |
Other debt proceeds | 5,700 | 68,132 |
Repayments of debt | ' | ' |
Revolving Credit Facility | 0 | -99,000 |
Scheduled principal amortization | -1,855 | -2,512 |
Other debt repayments | -50 | -125,877 |
Deferred financing costs paid | -9 | -1,109 |
Net proceeds from issuance of common shares/units | 568 | 118,389 |
Common share/unit dividends/distributions paid | -25,124 | -23,481 |
Preferred share/unit dividends/distributions paid | -4,655 | -6,271 |
Restricted share redemptions | -1,092 | -1,576 |
Other | -165 | 85 |
Net cash (used in) provided by financing activities | -26,682 | 25,780 |
Net (decrease) increase in cash and cash equivalents | -35,999 | 12,915 |
Cash and cash equivalents | ' | ' |
Beginning of period | 54,373 | 10,594 |
End of period | 18,374 | 23,509 |
Reconciliation of net income to net cash provided by operating activities: | ' | ' |
Net income | 5,671 | 15,277 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and other amortization | 44,101 | 28,782 |
Impairment losses | 1 | 1,857 |
Settlement of previously accreted interest expense | 0 | -2,263 |
Amortization of deferred financing costs | 1,167 | 1,528 |
Decrease (increase) in deferred rent receivable | 398 | -4,236 |
Amortization of net debt discounts | 171 | 710 |
Loss (gain) on sales of real estate | 4 | -2,354 |
Share-based compensation | 1,555 | 1,649 |
Loss on early extinguishment of debt | -78 | 381 |
Other | -1,032 | -580 |
Changes in operating assets and liabilities: | ' | ' |
(Increase) decrease in accounts receivable | -1,769 | 6,342 |
Decrease in restricted cash and marketable securities | 381 | 483 |
(Increase) decrease in prepaid expenses and other assets | -494 | 4,180 |
Increase (decrease) in accounts payable, accrued expenses and other liabilities | 4,687 | -2,837 |
Decrease in rents received in advance and security deposits | -3,225 | -1,608 |
Net cash provided by operating activities | 51,538 | 47,311 |
Supplemental schedule of non-cash investing and financing activities: | ' | ' |
Decrease in accrued capital improvements, leasing and other investing activity costs | -7,985 | -5,353 |
(Decrease) increase in fair value of derivatives applied to accumulated other comprehensive income (loss) and noncontrolling interests | -1,443 | 1,105 |
Dividends and distributions payable | 29,122 | 29,947 |
(Decrease) increase in redeemable noncontrolling interest and (increase) decrease in shareholders’ equity to carry redeemable noncontrolling interest at fair value | ($540) | $848 |
Organization
Organization | 3 Months Ended | |
Mar. 31, 2014 | ||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |
Organization | ' | |
Organization | ||
Corporate Office Properties Trust (“COPT”) and subsidiaries (collectively, the “Company”) is a fully-integrated and self-managed real estate investment trust (“REIT”). Corporate Office Properties, L.P. (“COPLP”) and subsidiaries (collectively, the “Operating Partnership”) is the entity through which COPT, the sole general partner of COPLP, conducts almost all of its operations and owns almost all of its assets. Unless otherwise expressly stated or the context otherwise requires, “we”, “us” and “our” as used herein refer to each of the Company and the Operating Partnership. We focus primarily on serving the specialized requirements of United States Government agencies and defense contractors, most of whom are engaged in defense information technology and national security related activities. We generally acquire, develop, manage and lease office and data center properties concentrated in large office parks located near knowledge-based government demand drivers and/or in targeted markets or submarkets in the Greater Washington, DC/Baltimore region. As of March 31, 2014, our properties included the following: | ||
• | 183 operating office properties totaling 17.5 million square feet; | |
• | 12 office properties under, or contractually committed for, construction or redevelopment that we estimate will total approximately 1.6 million square feet upon completion, including two partially operational properties included above; | |
• | land held or under pre-construction totaling 1,716 acres (including 56 acres controlled but not owned) that we believe are potentially developable into approximately 19.7 million square feet; and | |
• | a partially operational, wholesale data center which upon completion and stabilization is expected to have a critical load of 18 megawatts. | |
COPLP owns real estate both directly and through subsidiary partnerships and limited liability companies (“LLCs”). In addition to owning real estate, COPLP also owns subsidiaries that provide real estate services such as property management and construction and development services primarily for our properties but also for third parties. Some of these services are performed by a taxable REIT subsidiary (“TRS”). | ||
Interests in COPLP are in the form of common and preferred units. As of March 31, 2014, COPT owned 95.7% of the outstanding COPLP common units (“common units”) and 96.4% of the outstanding COPLP preferred units (“preferred units”); the remaining common and preferred units in COPLP were owned by third parties. Three of COPT’s trustees controlled, either directly or through ownership by other entities or family members, 3.4% of COPLP’s common units as of March 31, 2014. Common units in COPLP not owned by COPT carry certain redemption rights. The number of common units in COPLP owned by COPT is equivalent to the number of outstanding common shares of beneficial interest (“common shares”) of COPT, and the entitlement of all COPLP common units to quarterly distributions and payments in liquidation are substantially the same as those of COPT common shareholders. Similarly, in the case of each series of preferred units in COPLP held by COPT, there is a series of preferred shares of beneficial interest (“preferred shares”) in COPT that is equivalent in number and carries substantially the same terms as such series of COPLP preferred units. COPT’s common shares are publicly traded on the New York Stock Exchange (“NYSE”) under the ticker symbol “OFC”. | ||
Because COPLP is managed by COPT, and COPT conducts substantially all of its operations through COPLP, we refer to COPT’s executive officers as COPLP’s executive officers, and although, as a partnership, COPLP does not have a board of trustees, we refer to COPT’s Board of Trustees as COPLP’s Board of Trustees. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Summary of Significant Accounting Policies | ' |
Summary of Significant Accounting Policies | |
Basis of Presentation | |
The COPT consolidated financial statements include the accounts of COPT, the Operating Partnership, their subsidiaries and other entities in which COPT has a majority voting interest and control. The COPLP consolidated financial statements include the accounts of COPLP, its subsidiaries and other entities in which COPLP has a majority voting interest and control. We also consolidate certain entities when control of such entities can be achieved through means other than voting rights (“variable interest entities” or “VIEs”) if they are deemed to be the primary beneficiary of such entities. We eliminate all significant intercompany balances and transactions in consolidation. | |
We use the equity method of accounting when we own an interest in an entity and can exert significant influence over the entity’s operations but cannot control the entity’s operations. We discontinue equity method accounting if our investment in an entity (and net advances) is reduced to zero unless we have guaranteed obligations of the entity or are otherwise committed to provide further financial support for the entity. | |
These interim financial statements should be read together with the consolidated financial statements and notes thereto as of and for the year ended December 31, 2013 included in our 2013 Annual Report on Form 10-K. The unaudited consolidated financial statements include all adjustments that are necessary, in the opinion of management, to fairly present our financial position and results of operations. All adjustments are of a normal recurring nature. The consolidated financial statements have been prepared using the accounting policies described in our 2013 Annual Report on Form 10-K. | |
Reclassifications | |
We reclassified certain amounts from prior periods to conform to the current period presentation of our consolidated financial statements with no effect on previously reported net income or equity. These reclassifications occurred in conjunction with the transfer of properties to, and from, discontinued operations during 2013. | |
Recent Accounting Pronouncement | |
In April 2014, the Financial Accounting Standards Board (“FASB”) issued guidance related to the reporting of discontinued operation and disclosures of disposals of components of an entity. This guidance defines a discontinued operation as a component or group of components disposed or classified as held for sale and represents a strategic shift that has (or will have) a major effect on an entity’s operations and final result; the guidance states that a strategic shift could include a disposal of a major geographical area of operations, a major line of business, a major equity method investment or other major parts of an entity. The guidance also provides for additional disclosure requirements in connection with both discontinued operations and other dispositions not qualifying as discontinued operations. The guidance will be effective for annual and interim periods beginning on or after December 15, 2014. The guidance applies prospectively to new disposals and new classifications of disposal groups as held for sale after the effective date. All entities may early adopt the guidance for new disposals (or new classifications as held for sale) that have not been reported in financial statements previously issued or available for issuance. We are in the process of evaluating this guidance. |
Fair_Value_Measurements
Fair Value Measurements | 3 Months Ended | ||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||||||
Fair Value Measurements | |||||||||||||||||||||
For a description on how we estimate fair value, see Note 3 to the consolidated financial statements in our 2013 Annual Report on Form 10-K. | |||||||||||||||||||||
Recurring Fair Value Measurements | |||||||||||||||||||||
Our partner in a real estate joint venture has the right to require us to acquire its interest at fair value beginning in March 2020; accordingly, we classify the fair value of our partner’s interest as a redeemable noncontrolling interest in the mezzanine section of our consolidated balance sheet. In determining the fair value of our partner’s interest as of March 31, 2014, we used a discount rate of 15.5%. The discount rate factored in risk appropriate to the level of future property development expected to be undertaken by the joint venture. A significant increase (decrease) in the discount rate used in determining the fair value would result in a significantly (lower) higher fair value. Given our reliance on the unobservable inputs, the valuations are classified in Level 3 of the fair value hierarchy. | |||||||||||||||||||||
The carrying values of cash and cash equivalents, restricted cash, accounts receivable, other assets (excluding investing receivables) and accounts payable and accrued expenses are reasonable estimates of their fair values because of the short maturities of these instruments. As discussed in Note 6, we estimated the fair values of our mortgage and other investing receivables based on the discounted estimated future cash flows of the loans (categorized within Level 3 of the fair value hierarchy); the discount rates used approximate current market rates for loans with similar maturities and credit quality, and the estimated cash payments include scheduled principal and interest payments. For our disclosure of debt fair values in Note 8, we estimated the fair value of our unsecured senior notes and exchangeable senior notes based on quoted market rates for publicly-traded debt (categorized within Level 2 of the fair value hierarchy) and estimated the fair value of our other debt based on the discounted estimated future cash payments to be made on such debt (categorized within Level 3 of the fair value hierarchy); the discount rates used approximate current market rates for loans, or groups of loans, with similar maturities and credit quality, and the estimated future payments include scheduled principal and interest payments. Fair value estimates are made at a specific point in time, are subjective in nature and involve uncertainties and matters of significant judgment. Settlement at such fair value amounts may not be possible and may not be a prudent management decision. | |||||||||||||||||||||
For additional fair value information, please refer to Note 6 for mortgage loans receivable, Note 8 for debt and Note 9 for interest rate derivatives. | |||||||||||||||||||||
COPT and Subsidiaries | |||||||||||||||||||||
The table below sets forth financial assets and liabilities of COPT and its subsidiaries that are accounted for at fair value on a recurring basis as of March 31, 2014 and the hierarchy level of inputs used in measuring their respective fair values under applicable accounting standards (in thousands): | |||||||||||||||||||||
Description | Quoted Prices in | Significant Other | Significant | Total | |||||||||||||||||
Active Markets for | Observable Inputs(Level 2) | Unobservable Inputs(Level 3) | |||||||||||||||||||
Identical Assets(Level 1) | |||||||||||||||||||||
Assets: | |||||||||||||||||||||
Marketable securities in deferred compensation plan (1) | |||||||||||||||||||||
Mutual funds | $ | 7,249 | $ | — | $ | — | $ | 7,249 | |||||||||||||
Common stocks | 115 | — | — | 115 | |||||||||||||||||
Other | 201 | — | — | 201 | |||||||||||||||||
Interest rate derivatives (2) | — | 5,038 | — | 5,038 | |||||||||||||||||
Warrants to purchase common stock (2) | — | 537 | — | 537 | |||||||||||||||||
Total Assets | $ | 7,565 | $ | 5,575 | $ | — | $ | 13,140 | |||||||||||||
Liabilities: | |||||||||||||||||||||
Deferred compensation plan liability (3) | $ | — | $ | 7,565 | $ | — | $ | 7,565 | |||||||||||||
Interest rate derivatives | — | 3,196 | — | 3,196 | |||||||||||||||||
Total Liabilities | $ | — | $ | 10,761 | $ | — | $ | 10,761 | |||||||||||||
Redeemable noncontrolling interest | $ | — | $ | — | $ | 17,654 | $ | 17,654 | |||||||||||||
(1) Included in the line entitled “restricted cash and marketable securities” on COPT’s consolidated balance sheet. | |||||||||||||||||||||
(2) Included in the line entitled “prepaid expenses and other assets” on COPT’s consolidated balance sheet. | |||||||||||||||||||||
(3) Included in the line entitled “other liabilities” on COPT’s consolidated balance sheet. | |||||||||||||||||||||
COPLP and Subsidiaries | |||||||||||||||||||||
The table below sets forth financial assets and liabilities of COPLP and its subsidiaries that are accounted for at fair value on a recurring basis as of March 31, 2014 and the hierarchy level of inputs used in measuring their respective fair values under applicable accounting standards (in thousands): | |||||||||||||||||||||
Description | Quoted Prices in | Significant Other | Significant | Total | |||||||||||||||||
Active Markets for | Observable Inputs(Level 2) | Unobservable Inputs(Level 3) | |||||||||||||||||||
Identical Assets(Level 1) | |||||||||||||||||||||
Assets: | |||||||||||||||||||||
Interest rate derivatives (1) | $ | — | $ | 5,038 | $ | — | $ | 5,038 | |||||||||||||
Warrants to purchase common stock (1) | — | 537 | — | 537 | |||||||||||||||||
Total Assets | $ | — | $ | 5,575 | $ | — | $ | 5,575 | |||||||||||||
Liabilities: | |||||||||||||||||||||
Interest rate derivatives | $ | — | $ | 3,196 | $ | — | $ | 3,196 | |||||||||||||
Redeemable noncontrolling interest | $ | — | $ | — | $ | 17,654 | $ | 17,654 | |||||||||||||
(1) Included in the line entitled “prepaid expenses and other assets” on COPLP’s consolidated balance sheet. | |||||||||||||||||||||
Nonrecurring Fair Value Measurements | |||||||||||||||||||||
During the three months ended March 31, 2013, we recognized a non-cash impairment loss of $1.9 million for the amount by which the carrying values of certain properties exceeded their estimated fair values. The table below sets forth the fair value hierarchy of the valuation techniques used by us in determining the fair value of the property (dollars in thousands): | |||||||||||||||||||||
Fair Value of Property Held as of March 31, 2013 | Impairment Losses | ||||||||||||||||||||
Quoted Prices in | Significant | Recognized in | |||||||||||||||||||
Active Markets for | Significant Other | Unobservable | Three Months | ||||||||||||||||||
Identical Assets | Observable Inputs | Inputs | Ended | ||||||||||||||||||
Description | (Level 1) | (Level 2) | (Level 3) | Total | 31-Mar-13 | ||||||||||||||||
Assets: | |||||||||||||||||||||
Properties, net | $ | — | $ | — | $ | 7,250 | $ | 7,250 | $ | 1,857 | |||||||||||
The table below sets forth quantitative information about significant unobservable inputs used for the Level 3 fair value measurements reported above as of March 31, 2013 (dollars in thousands): | |||||||||||||||||||||
Valuation Technique | Fair Value on | Unobservable Input | Range (Weighted Average) | ||||||||||||||||||
Measurement Date | |||||||||||||||||||||
Bids for property indicative of value | $ | 7,250 | Indicative bid | -1 | |||||||||||||||||
(1) This fair value measurement was developed as a result of negotiations between us and a purchaser of a property. |
Properties_net
Properties, net | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Real Estate [Abstract] | ' | |||||||
Properties, net | ' | |||||||
Properties, net | ||||||||
Operating properties, net consisted of the following (in thousands): | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
Land | $ | 436,381 | $ | 430,472 | ||||
Buildings and improvements | 2,927,800 | 2,869,870 | ||||||
Less: accumulated depreciation | (635,178 | ) | (597,649 | ) | ||||
Operating properties, net | $ | 2,729,003 | $ | 2,702,693 | ||||
During the three months ended March 31, 2014, we recognized $12.9 million in additional depreciation expense resulting from our revision of the useful life of a property in Greater Philadelphia that was removed from service for redevelopment. | ||||||||
Projects we had in development or held for future development consisted of the following (in thousands): | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
Land | $ | 238,904 | $ | 245,676 | ||||
Construction in progress, excluding land | 256,721 | 265,932 | ||||||
Projects in development or held for future development | $ | 495,625 | $ | 511,608 | ||||
2014 Construction Activities | ||||||||
During the three months ended March 31, 2014, we placed into service an aggregate of 355,000 square feet in two newly constructed office properties located in Northern Virginia and Huntsville, Alabama. As of March 31, 2014, we had eight office properties under construction, or for which we were contractually committed to construct, that we estimate will total 1.2 million square feet upon completion, including four in the Baltimore/Washington Corridor, three in Northern Virginia and one in San Antonio. We also had four office properties under redevelopment that we estimate will total 403,000 square feet upon completion, including two in Greater Philadelphia, one in the Baltimore/Washington Corridor and one in St. Mary’s County, Maryland. |
Real_Estate_Joint_Ventures
Real Estate Joint Ventures | 3 Months Ended | ||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||
Equity Method Investments and Joint Ventures [Abstract] | ' | ||||||||||||||||||
Real Estate Joint Ventures | ' | ||||||||||||||||||
Real Estate Joint Ventures | |||||||||||||||||||
The table below sets forth information pertaining to our investments in consolidated real estate joint ventures as of March 31, 2014 (dollars in thousands): | |||||||||||||||||||
Nominal | |||||||||||||||||||
Ownership | March 31, 2014 | -1 | |||||||||||||||||
Date | % as of | Total | Encumbered | Total | |||||||||||||||
Acquired | 3/31/14 | Nature of Activity | Assets | Assets | Liabilities | ||||||||||||||
LW Redstone Company, LLC | 3/23/10 | 85% | Operates four buildings and developing others (2) | $ | 135,231 | $ | 68,360 | $ | 36,272 | ||||||||||
M Square Associates, LLC | 6/26/07 | 50% | Operates two buildings and developing others (3) | 60,728 | 48,358 | 40,536 | |||||||||||||
COPT-FD Indian Head, LLC | 10/23/06 | 75% | Holding land parcel (4) | 6,436 | — | — | |||||||||||||
$ | 202,395 | $ | 116,718 | $ | 76,808 | ||||||||||||||
-1 | Excludes amounts eliminated in consolidation. | ||||||||||||||||||
-2 | This joint venture’s property is in Huntsville, Alabama. | ||||||||||||||||||
-3 | This joint venture’s properties are in College Park, Maryland (in the Baltimore/Washington Corridor). | ||||||||||||||||||
-4 | This joint venture’s property is in Charles County, Maryland. In 2012, the joint venture exercised its option under a development agreement to require Charles County to repurchase the land parcel at its original acquisition cost. Under the terms of the agreement with Charles County, the repurchase is expected to occur by August 2014. | ||||||||||||||||||
Our commitments and contingencies pertaining to our real estate joint ventures are disclosed in Note 17. |
Mortgage_and_Other_Investing_R
Mortgage and Other Investing Receivables | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Receivables [Abstract] | ' | |||||||
Mortgage and Other Investing Receivables | ' | |||||||
Mortgage and Other Investing Receivables | ||||||||
Mortgage and other investing receivables, including accrued interest thereon, consisted of the following (in thousands): | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
Notes receivable from City of Huntsville | $ | 45,381 | $ | 44,055 | ||||
Mortgage loan receivable | 9,850 | 9,608 | ||||||
$ | 55,231 | $ | 53,663 | |||||
Our notes receivable from the City of Huntsville funded infrastructure costs in connection with our LW Redstone Company, LLC joint venture (see Note 5). The mortgage loan receivable reflected above consisted of one loan secured by a property in Greater Baltimore. We did not have an allowance for credit losses in connection with our mortgage and other investing receivables as of March 31, 2014 or December 31, 2013. The fair value of these receivables approximated their carrying amounts as of March 31, 2014 and December 31, 2013. |
Prepaid_Expenses_and_Other_Ass
Prepaid Expenses and Other Assets | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Prepaid Expense and Other Assets [Abstract] | ' | |||||||
Prepaid Expenses and Other Assets | ' | |||||||
Prepaid Expenses and Other Assets | ||||||||
Prepaid expenses and other assets consisted of the following (in thousands): | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
Prepaid expenses | $ | 13,813 | $ | 19,308 | ||||
Lease incentives | 11,900 | 8,435 | ||||||
Furniture, fixtures and equipment, net | 7,068 | 6,556 | ||||||
Interest rate derivatives | 5,038 | 6,594 | ||||||
Construction contract costs incurred in excess of billings | 4,990 | 2,462 | ||||||
Deferred tax asset, net (1) | 4,241 | 4,305 | ||||||
Other equity method investments | 2,266 | 2,258 | ||||||
Other assets | 4,616 | 4,268 | ||||||
Prepaid expenses and other assets | $ | 53,932 | $ | 54,186 | ||||
(1) Includes a valuation allowance of $2.1 million. | ||||||||
Other assets, as reported above, include operating notes receivable due from tenants with terms exceeding one year totaling $1.7 million as of March 31, 2014 and December 31, 2013; we carried allowances for estimated losses for $124,000 of the March 31, 2014 balance and $87,000 of the December 31, 2013 balance. |
Debt
Debt | 3 Months Ended | |||||||||||||||
Mar. 31, 2014 | ||||||||||||||||
Debt Disclosure [Abstract] | ' | |||||||||||||||
Debt | ' | |||||||||||||||
Debt | ||||||||||||||||
Our debt consisted of the following (dollars in thousands): | ||||||||||||||||
Maximum | ||||||||||||||||
Availability at | Carrying Value at | Scheduled Maturity | ||||||||||||||
March 31, | March 31, | December 31, | Stated Interest Rates as of | as of | ||||||||||||
2014 | 2014 | 2013 | March 31, 2014 | March 31, 2014 | ||||||||||||
Mortgage and Other Secured Loans: | ||||||||||||||||
Fixed rate mortgage loans (1) | -2 | $ | 679,260 | $ | 675,060 | 3.96% - 7.87% (3) | 2014-2024 | |||||||||
Variable rate secured loan | 37,491 | 37,691 | LIBOR + 2.25% (4) | Nov-15 | ||||||||||||
Total mortgage and other secured loans | 716,751 | 712,751 | ||||||||||||||
Revolving Credit Facility (5) | $ | 800,000 | — | — | LIBOR + 0.975% to 1.75% | Jul-17 | ||||||||||
Term Loan Facilities | -6 | 620,000 | 620,000 | LIBOR + 1.10% to 2.60% (7) | 2015-2019 | |||||||||||
Unsecured Senior Notes | ||||||||||||||||
3.600% Senior Notes (8) | 347,306 | 347,244 | 3.60% | May-23 | ||||||||||||
5.250% Senior Notes (9) | 245,532 | 245,445 | 5.25% | Feb-24 | ||||||||||||
Unsecured notes payable | 1,677 | 1,700 | 0% (10) | 2026 | ||||||||||||
4.25% Exchangeable Senior Notes (11) | 565 | 563 | 4.25% | Apr-30 | ||||||||||||
Total debt, net | $ | 1,931,831 | $ | 1,927,703 | ||||||||||||
(1) | Several of the fixed rate mortgages carry interest rates that were above or below market rates upon assumption and therefore were recorded at their fair value based on applicable effective interest rates. The carrying values of these loans reflect net unamortized premiums totaling $62,000 as of March 31, 2014 and $69,000 as of December 31, 2013. | |||||||||||||||
-2 | Includes $19.8 million balance on construction loans with maximum available borrowings of $26.2 million. | |||||||||||||||
-3 | The weighted average interest rate on these loans was 6.12% as of March 31, 2014. | |||||||||||||||
(4) | The interest rate on the loan outstanding was 2.41% as of March 31, 2014. | |||||||||||||||
-5 | No borrowings were outstanding on this facility during the three months ended March 31, 2014. | |||||||||||||||
(6) | We have the ability to borrow an aggregate of an additional $180.0 million under these term loan facilities, provided that there is no default under the facilities and subject to the approval of the lenders. | |||||||||||||||
(7) | The weighted average interest rate on these loans was 1.78% as of March 31, 2014. | |||||||||||||||
-8 | The carrying value of these notes included a principal amount of $350.0 million and an unamortized discount totaling $2.7 million as of March 31, 2014 and $2.8 million as of December 31, 2013. The effective interest rate under the notes, including amortization of the issuance costs, was 3.70%. | |||||||||||||||
-9 | The carrying value of these notes included a principal amount of $250.0 million and an unamortized discount totaling $4.5 million as of March 31, 2014 and $4.6 million as of December 31, 2013. The effective interest rate under the notes, including amortization of the issuance costs, was 5.49%. | |||||||||||||||
(10) | These notes carry interest rates that were below market rates upon assumption and therefore were recorded at their fair value based on applicable effective interest rates. The carrying value of these notes reflects an unamortized discount totaling $734,000 as of March 31, 2014 and $761,000 as of December 31, 2013. | |||||||||||||||
(11) | As described further in our 2013 Annual Report on Form 10-K, these notes have an exchange settlement feature that provides that the notes may, under certain circumstances, be exchangeable for cash and, at COPLP’s discretion, COPT common shares at an exchange rate (subject to adjustment) of 20.8513 shares per one thousand dollar principal amount of the notes (exchange rate is as of March 31, 2014 and is equivalent to an exchange price of $47.96 per common share). The carrying value of these notes included a principal amount of $575,000 and an unamortized discount totaling $10,000 as of March 31, 2014 and $12,000 as of December 31, 2013. The effective interest rate under the notes, including amortization of the issuance costs, was 6.05%. Because the closing price of our common shares as of March 31, 2014 and December 31, 2013 was less than the exchange price per common share applicable to these notes, the if-converted value of the notes did not exceed the principal amount. The table below sets forth interest expense recognized on these notes before deductions for amounts capitalized (in thousands): | |||||||||||||||
For the Three Months Ended March 31, | ||||||||||||||||
2014 | 2013 | |||||||||||||||
Interest expense at stated interest rate | $ | 6 | $ | 2,304 | ||||||||||||
Interest expense associated with amortization of discount | 3 | 864 | ||||||||||||||
Total | $ | 9 | $ | 3,168 | ||||||||||||
All debt is owed by the Operating Partnership. While COPT is not directly obligated by any debt, it has guaranteed our Revolving Credit Facility, Term Loan Facilities, Unsecured Senior Notes and 4.25% Exchangeable Senior Notes. | ||||||||||||||||
In April 2014, a wholly owned subsidiary of ours defaulted on the payment terms of a $150.0 million nonrecourse mortgage loan secured by two operating properties in Northern Virginia with an aggregate estimated fair value that was less than the loan balance. This loan has an interest rate of 5.65% and is scheduled to mature in 2017. | ||||||||||||||||
We capitalized interest costs of $1.6 million in the three months ended March 31, 2014 and $2.4 million in the three months ended March 31, 2013. | ||||||||||||||||
The following table sets forth information pertaining to the fair value of our debt (in thousands): | ||||||||||||||||
March 31, 2014 | December 31, 2013 | |||||||||||||||
Carrying | Estimated | Carrying | Estimated | |||||||||||||
Amount | Fair Value | Amount | Fair Value | |||||||||||||
Fixed-rate debt | ||||||||||||||||
Unsecured Senior Notes | $ | 592,838 | $ | 584,178 | $ | 592,689 | $ | 575,374 | ||||||||
4.25% Exchangeable Senior Notes | 565 | 575 | 563 | 575 | ||||||||||||
Other fixed-rate debt | 680,937 | 668,949 | 676,760 | 650,997 | ||||||||||||
Variable-rate debt | 657,491 | 657,420 | 657,691 | 657,527 | ||||||||||||
$ | 1,931,831 | $ | 1,911,122 | $ | 1,927,703 | $ | 1,884,473 | |||||||||
Interest_Rate_Derivatives
Interest Rate Derivatives | 3 Months Ended | ||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||||
Interest Rate Derivatives | ' | ||||||||||||||||||
Interest Rate Derivatives | |||||||||||||||||||
The following table sets forth the key terms and fair values of our interest rate swap derivatives (dollars in thousands): | |||||||||||||||||||
Fair Value at | |||||||||||||||||||
Notional Amount | Fixed Rate | Floating Rate Index | Effective Date | Expiration Date | March 31, | December 31, | |||||||||||||
2014 | 2013 | ||||||||||||||||||
$ | 100,000 | 0.61% | One-Month LIBOR | 1/3/12 | 9/1/14 | $ | (195 | ) | $ | (279 | ) | ||||||||
100,000 | 0.61% | One-Month LIBOR | 1/3/12 | 9/1/14 | (194 | ) | (277 | ) | |||||||||||
100,000 | 0.83% | One-Month LIBOR | 1/3/12 | 9/1/15 | (807 | ) | (861 | ) | |||||||||||
100,000 | 0.83% | One-Month LIBOR | 1/3/12 | 9/1/15 | (807 | ) | (861 | ) | |||||||||||
37,491 | -1 | 3.83% | One-Month LIBOR + 2.25% | 11/2/10 | 11/2/15 | (742 | ) | (832 | ) | ||||||||||
100,000 | 0.81% | One-Month LIBOR | 9/2/14 | 9/1/16 | (220 | ) | (94 | ) | |||||||||||
100,000 | 0.81% | One-Month LIBOR | 9/2/14 | 9/1/16 | (231 | ) | (105 | ) | |||||||||||
100,000 | 1.67% | One-Month LIBOR | 9/1/15 | 8/1/19 | 2,604 | 3,377 | |||||||||||||
100,000 | 1.73% | One-Month LIBOR | 9/1/15 | 8/1/19 | 2,434 | 3,217 | |||||||||||||
$ | 1,842 | $ | 3,285 | ||||||||||||||||
-1 | The notional amount of this instrument is scheduled to amortize to $36.2 million. | ||||||||||||||||||
Each of the one-month LIBOR interest rate swaps set forth in the table above was designated as cash flow hedges of interest rate risk. | |||||||||||||||||||
The table below sets forth the fair value of our interest rate derivatives as well as their classification on our consolidated balance sheet (in thousands): | |||||||||||||||||||
March 31, 2014 | 31-Dec-13 | ||||||||||||||||||
Derivatives | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||||||||
Interest rate swaps designated as cash flow hedges | Prepaid expenses and other assets | $ | 5,038 | Prepaid expenses and other assets | $ | 6,594 | |||||||||||||
Interest rate swaps designated as cash flow hedges | Interest rate derivatives | (3,196 | ) | Interest rate derivatives | (3,309 | ) | |||||||||||||
The table below presents the effect of our interest rate derivatives on our consolidated statements of operations and comprehensive income (in thousands): | |||||||||||||||||||
For the Three Months Ended March 31, | |||||||||||||||||||
2014 | 2013 | ||||||||||||||||||
Amount of (losses) gains recognized in accumulated other comprehensive income (loss) (“AOCI”) (effective portion) | $ | (2,123 | ) | $ | 462 | ||||||||||||||
Amount of losses reclassified from AOCI into interest expense (effective portion) | 695 | 658 | |||||||||||||||||
Over the next 12 months, we estimate that approximately $3.0 million of losses will be reclassified from AOCI as an increase to interest expense. | |||||||||||||||||||
We have agreements with each of our interest rate derivative counterparties that contain provisions under which, if we default or are capable of being declared in default on any of our indebtedness, we could also be declared in default on our derivative obligations. These agreements also incorporate the loan covenant provisions of our indebtedness with a lender affiliate of the derivative counterparties. Failure to comply with the loan covenant provisions could result in our being declared in default on any derivative instrument obligations covered by the agreements. As of March 31, 2014, the fair value of interest rate derivatives in a liability position related to these agreements was $3.2 million, excluding the effects of accrued interest. As of March 31, 2014, we had not posted any collateral related to these agreements. We are not in default with any of these provisions. If we breached any of these provisions, we could be required to settle our obligations under the agreements at their termination value of $3.4 million. |
Redeemable_Noncontrolling_Inte
Redeemable Noncontrolling Interest | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Noncontrolling Interest [Abstract] | ' | ||||||||
Redeemable Noncontrolling Interest | ' | ||||||||
Redeemable Noncontrolling Interest | |||||||||
The table below sets forth activity in a redeemable noncontrolling interest in a consolidated real estate joint venture (in thousands): | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Beginning balance | $ | 17,758 | $ | 10,298 | |||||
Distribution to noncontrolling interest | (68 | ) | — | ||||||
Net income (loss) attributable to noncontrolling interest | 504 | (790 | ) | ||||||
Adjustment to arrive at fair value of interest | (540 | ) | 848 | ||||||
Ending balance | $ | 17,654 | $ | 10,356 | |||||
Equity
Equity | 3 Months Ended |
Mar. 31, 2014 | |
Equity [Abstract] | ' |
Equity | ' |
Equity | |
During the three months ended March 31, 2014, certain COPLP limited partners redeemed 48,498 common units in COPLP for common shares in COPT on the basis of one common share for each common unit. | |
See Note 13 for disclosure of COPT common share and COPLP common unit activity pertaining to our share-based compensation plans. |
Information_by_Business_Segmen
Information by Business Segment | 3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||||||||||||||||||||||||||||||||||
Information by Business Segment | ' | |||||||||||||||||||||||||||||||||||||||||||||||
Information by Business Segment | ||||||||||||||||||||||||||||||||||||||||||||||||
We have ten reportable operating office property segments (comprised of: the Baltimore/Washington Corridor; Northern Virginia; San Antonio; Huntsville; Washington, DC — Capitol Riverfront; St. Mary’s and King George Counties; Greater Baltimore; Greater Philadelphia; Colorado Springs; and Other). We also have an operating wholesale data center segment. The table below reports segment financial information for our reportable segments (in thousands). We measure the performance of our segments through the measure we define as NOI from real estate operations, which is derived by subtracting property operating expenses from revenues from real estate operations. | ||||||||||||||||||||||||||||||||||||||||||||||||
Operating Office Property Segments | ||||||||||||||||||||||||||||||||||||||||||||||||
Baltimore/ | Northern | San | Huntsville | Washington, | St. Mary’s & | Greater | Greater | Colorado | Other | Operating | Total | |||||||||||||||||||||||||||||||||||||
Washington | Virginia | Antonio | DC - Capitol | King George | Baltimore | Philadelphia | Springs | Wholesale | ||||||||||||||||||||||||||||||||||||||||
Corridor | Riverfront | Counties | Data Center | |||||||||||||||||||||||||||||||||||||||||||||
Three Months Ended March 31, 2014 | ||||||||||||||||||||||||||||||||||||||||||||||||
Revenues from real estate operations | $ | 61,113 | $ | 24,968 | $ | 8,479 | $ | 2,555 | $ | 3,634 | $ | 4,316 | $ | 11,496 | $ | 3,340 | $ | 18 | $ | 2,576 | $ | 2,401 | $ | 124,896 | ||||||||||||||||||||||||
Property operating expenses | 23,597 | 8,973 | 4,474 | 653 | 1,765 | 1,504 | 5,476 | 1,300 | (9 | ) | 331 | 1,688 | 49,752 | |||||||||||||||||||||||||||||||||||
NOI from real estate operations | $ | 37,516 | $ | 15,995 | $ | 4,005 | $ | 1,902 | $ | 1,869 | $ | 2,812 | $ | 6,020 | $ | 2,040 | $ | 27 | $ | 2,245 | $ | 713 | $ | 75,144 | ||||||||||||||||||||||||
Additions to long-lived assets | $ | 5,741 | $ | 3,495 | $ | (6 | ) | $ | 2,507 | $ | 63 | $ | 839 | $ | 1,012 | $ | 11 | $ | — | $ | 55 | $ | 12 | $ | 13,729 | |||||||||||||||||||||||
Transfers from non-operating properties | $ | (169 | ) | $ | 26,588 | $ | — | $ | 20,102 | $ | — | $ | — | $ | 7,154 | $ | 3,176 | $ | 11 | $ | — | $ | 78 | $ | 56,940 | |||||||||||||||||||||||
Segment assets at March 31, 2014 | $ | 1,237,796 | $ | 636,895 | $ | 117,812 | $ | 99,378 | $ | 97,843 | $ | 95,645 | $ | 307,699 | $ | 94,428 | $ | 7 | $ | 79,535 | $ | 165,711 | $ | 2,932,749 | ||||||||||||||||||||||||
Three Months Ended March 31, 2013 | ||||||||||||||||||||||||||||||||||||||||||||||||
Revenues from real estate operations | $ | 58,660 | $ | 22,942 | $ | 7,757 | $ | 740 | $ | 4,244 | $ | 3,992 | $ | 10,719 | $ | 2,487 | $ | 6,682 | $ | 2,501 | $ | 1,353 | $ | 122,077 | ||||||||||||||||||||||||
Property operating expenses | 20,053 | 7,817 | 3,888 | 182 | 1,949 | 1,193 | 4,168 | 838 | 2,437 | 225 | 1,316 | 44,066 | ||||||||||||||||||||||||||||||||||||
NOI from real estate operations | $ | 38,607 | $ | 15,125 | $ | 3,869 | $ | 558 | $ | 2,295 | $ | 2,799 | $ | 6,551 | $ | 1,649 | $ | 4,245 | $ | 2,276 | $ | 37 | $ | 78,011 | ||||||||||||||||||||||||
Additions to long-lived assets | $ | 2,760 | $ | 1,544 | $ | 10 | $ | — | $ | 157 | $ | 275 | $ | 702 | $ | — | $ | 315 | $ | 91 | $ | — | $ | 5,854 | ||||||||||||||||||||||||
Transfers from non-operating properties | $ | 22,997 | $ | 9,839 | $ | — | $ | 24,240 | $ | — | $ | 6 | $ | 113 | $ | 7,050 | $ | 1,783 | $ | — | $ | 65,568 | $ | 131,596 | ||||||||||||||||||||||||
Segment assets at March 31, 2013 | $ | 1,279,794 | $ | 574,970 | $ | 119,145 | $ | 52,361 | $ | 102,928 | $ | 97,346 | $ | 317,953 | $ | 85,017 | $ | 177,728 | $ | 81,714 | $ | 166,920 | $ | 3,055,876 | ||||||||||||||||||||||||
The following table reconciles our segment revenues to total revenues as reported on our consolidated statements of operations (in thousands): | ||||||||||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, | ||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||||||||||||||||||
Segment revenues from real estate operations | $ | 124,896 | $ | 122,077 | ||||||||||||||||||||||||||||||||||||||||||||
Construction contract and other service revenues | 21,790 | 14,262 | ||||||||||||||||||||||||||||||||||||||||||||||
Less: Revenues from discontinued operations (Note 15) | (19 | ) | (10,120 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Total revenues | $ | 146,667 | $ | 126,219 | ||||||||||||||||||||||||||||||||||||||||||||
The following table reconciles our segment property operating expenses to property operating expenses as reported on our consolidated statements of operations (in thousands): | ||||||||||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, | ||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||||||||||||||||||
Segment property operating expenses | $ | 49,752 | $ | 44,066 | ||||||||||||||||||||||||||||||||||||||||||||
Less: Property operating expenses from discontinued operations (Note 15) | 20 | (3,678 | ) | |||||||||||||||||||||||||||||||||||||||||||||
Total property operating expenses | $ | 49,772 | $ | 40,388 | ||||||||||||||||||||||||||||||||||||||||||||
As previously discussed, we provide real estate services such as property management and construction and development services primarily for our properties but also for third parties. The primary manner in which we evaluate the operating performance of our service activities is through a measure we define as net operating income from service operations (“NOI from service operations”), which is based on the net of revenues and expenses from these activities. Construction contract and other service revenues and expenses consist primarily of subcontracted costs that are reimbursed to us by the customer along with a management fee. The operating margins from these activities are small relative to the revenue. We believe NOI from service operations is a useful measure in assessing both our level of activity and our profitability in conducting such operations. The table below sets forth the computation of our NOI from service operations (in thousands): | ||||||||||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, | ||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||||||||||||||||||
Construction contract and other service revenues | $ | 21,790 | $ | 14,262 | ||||||||||||||||||||||||||||||||||||||||||||
Construction contract and other service expenses | (18,624 | ) | (13,477 | ) | ||||||||||||||||||||||||||||||||||||||||||||
NOI from service operations | $ | 3,166 | $ | 785 | ||||||||||||||||||||||||||||||||||||||||||||
The following table reconciles our NOI from real estate operations for reportable segments and NOI from service operations to income from continuing operations as reported on our consolidated statements of operations (in thousands): | ||||||||||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, | ||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||||||||||||||||||
NOI from real estate operations | $ | 75,144 | $ | 78,011 | ||||||||||||||||||||||||||||||||||||||||||||
NOI from service operations | 3,166 | 785 | ||||||||||||||||||||||||||||||||||||||||||||||
Interest and other income | 1,285 | 946 | ||||||||||||||||||||||||||||||||||||||||||||||
Equity in income of unconsolidated entities | 60 | 41 | ||||||||||||||||||||||||||||||||||||||||||||||
Income tax expense | (64 | ) | (16 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Other adjustments: | — | |||||||||||||||||||||||||||||||||||||||||||||||
Depreciation and other amortization associated with real estate operations | (43,596 | ) | (27,010 | ) | ||||||||||||||||||||||||||||||||||||||||||||
General, administrative and leasing expenses | (8,143 | ) | (7,820 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Business development expenses and land carry costs | (1,326 | ) | (1,359 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Interest expense on continuing operations | (20,827 | ) | (20,290 | ) | ||||||||||||||||||||||||||||||||||||||||||||
NOI from discontinued operations | (39 | ) | (6,442 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Loss on early extinguishment of debt | — | (5,184 | ) | |||||||||||||||||||||||||||||||||||||||||||||
Income from continuing operations | $ | 5,660 | $ | 11,662 | ||||||||||||||||||||||||||||||||||||||||||||
The following table reconciles our segment assets to the consolidated total assets of COPT and subsidiaries (in thousands): | ||||||||||||||||||||||||||||||||||||||||||||||||
March 31, | March 31, | |||||||||||||||||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||||||||||||||||||
Segment assets | $ | 2,932,749 | $ | 3,055,876 | ||||||||||||||||||||||||||||||||||||||||||||
Non-operating property assets | 503,030 | 490,083 | ||||||||||||||||||||||||||||||||||||||||||||||
Other assets | 170,118 | 139,140 | ||||||||||||||||||||||||||||||||||||||||||||||
Total COPT consolidated assets | $ | 3,605,897 | $ | 3,685,099 | ||||||||||||||||||||||||||||||||||||||||||||
The accounting policies of the segments are the same as those used to prepare our consolidated financial statements, except that discontinued operations are not presented separately for segment purposes. In the segment reporting presented above, we did not allocate interest expense, depreciation and amortization, impairment losses and loss on early extinguishment of debt to our real estate segments since they are not included in the measure of segment profit reviewed by management. We also did not allocate general and administrative expenses, business development expenses and land carry costs, interest and other income, equity in income of unconsolidated entities, income taxes and noncontrolling interests because these items represent general corporate or non-operating property items not attributable to segments. |
ShareBased_Compensation
Share-Based Compensation | 3 Months Ended | ||
Mar. 31, 2014 | |||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||
Share-Based Compensation | ' | ||
Share-Based Compensation | |||
Performance Share Units (“PSUs”) | |||
On March 6, 2014, our Board of Trustees granted 49,103 PSUs with an aggregate grant date fair value of $1.7 million to executives. The PSUs have a performance period beginning on January 1, 2014 and concluding on the earlier of December 31, 2016 or the date of: (1) termination by us without cause, death or disability of the executive or constructive discharge of the executive (collectively, “qualified termination”); or (2) a sale event. The number of PSUs earned (“earned PSUs”) at the end of the performance period will be determined based on the percentile rank of COPT’s total shareholder return relative to a peer group of companies, as set forth in the following schedule: | |||
Percentile Rank | Earned PSUs Payout % | ||
75th or greater | 200% of PSUs granted | ||
50th or greater | 100% of PSUs granted | ||
25th | 50% of PSUs granted | ||
Below 25th | 0% of PSUs granted | ||
If the percentile rank exceeds the 25th percentile and is between two of the percentile ranks set forth in the table above, then the percentage of the earned PSUs will be interpolated between the ranges set forth in the table above to reflect any performance between the listed percentiles. At the end of the performance period, we, in settlement of the award, will issue a number of fully-vested COPT common shares equal to the sum of: | |||
• | the number of earned PSUs in settlement of the award plan; plus | ||
• | the aggregate dividends that would have been paid with respect to the common shares issued in settlement of the earned PSUs through the date of settlement had such shares been issued on the grant date, divided by the share price on such settlement date, as defined under the terms of the agreement. | ||
If a performance period ends due to a sale event or qualified termination, the number of earned PSUs is prorated based on the portion of the three-year performance period that has elapsed. If employment is terminated by the employee or by us for cause, all PSUs are forfeited. PSUs do not carry voting rights. | |||
We computed a grant date fair value of $35.09 per PSU using a Monte Carlo model, which included assumptions of, among other things, the following: baseline common share value of $26.52; expected volatility for COPT common shares of 28.6%; and a risk-free interest rate of 0.66%. We are recognizing the grant date fair value in connection with these PSU awards over the period commencing on March 6, 2014 and ending on December 31, 2016. | |||
With regard to the PSUs granted to our executives in prior years that were outstanding as of December 31, 2013 as described in our 2013 Annual Report on Form 10-K: | |||
• | the performance period for the PSUs granted to executives on March 3, 2011 ended on March 2, 2014. Based on COPT’s total shareholder return during the performance period relative to its peer group of companies, there was no payout value in connection with the termination of the PSUs; and | ||
• | the PSUs granted to executives on March 1, 2012 and March 1, 2013 were outstanding as of March 31, 2014. | ||
Restricted Shares | |||
During the three months ended March 31, 2014, certain employees, as well as a nonemployee member of our Board of Trustees, were granted a total of 177,356 restricted shares with an aggregate grant date fair value of $4.7 million (weighted average of $26.63 per share). Restricted shares granted to employees vest based on increments and over periods of time set forth under the terms of the respective awards provided that the employees remain employed by us. The grants of restricted shares to nonemployee Trustees vest on the first anniversary of the grant date provided that the Trustee remains in his or her position. During the three months ended March 31, 2014, forfeiture restrictions lapsed on 110,356 previously issued common shares; these shares had a weighted average grant date fair value of $29.52 per share, and the aggregate intrinsic value of the shares on the vesting dates was $2.9 million. | |||
Options | |||
During the three months ended March 31, 2014, 26,614 options to purchase common shares (“options”) were exercised. The weighted average exercise price of these options was $21.34 per share, and the aggregate intrinsic value of the options exercised was $126,000. |
Income_Taxes
Income Taxes | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Income Tax Disclosure [Abstract] | ' | |||||||
Income Taxes | ' | |||||||
Income Taxes | ||||||||
We own a TRS that is subject to Federal and state income taxes. Our TRS’s provision for income taxes consisted of the following (in thousands): | ||||||||
For the Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
Deferred | ||||||||
Federal | $ | (53 | ) | $ | (13 | ) | ||
State | (11 | ) | (3 | ) | ||||
Total income tax expense | $ | (64 | ) | $ | (16 | ) | ||
Items in our TRS contributing to temporary differences that lead to deferred taxes include depreciation and amortization, share-based compensation, certain accrued compensation, compensation paid in the form of contributions to a deferred nonqualified compensation plan and net operating losses that are not deductible until future periods. | ||||||||
Our TRS’s combined Federal and state effective tax rate was 38.1% for the three months ended March 31, 2014 and 36.0% for the three months ended March 31, 2013. |
Discontinued_Operations
Discontinued Operations | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | |||||||
Discontinued Operations | ' | |||||||
Discontinued Operations | ||||||||
Income from discontinued operations primarily includes revenues and expenses associated with the following: | ||||||||
• | 920 Elkridge Landing Road in the Baltimore/Washington Corridor that was sold on June 25, 2013; | |||||||
• | 4230 Forbes Boulevard in the Baltimore/Washington Corridor that was sold on December 11, 2013; | |||||||
• | 15 operating properties in Colorado Springs that were sold on December 12, 2013; and | |||||||
• | nine operating properties the Baltimore/Washington Corridor and five operating properties in Colorado Springs for which the title to the properties was transferred to the mortgage lender on December 23, 2013. | |||||||
The table below sets forth the components of discontinued operations reported on our consolidated statements of operations (in thousands): | ||||||||
For the Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
Revenue from real estate operations | $ | 19 | $ | 10,120 | ||||
Property operating expenses | 20 | (3,678 | ) | |||||
Depreciation and amortization | — | (1,242 | ) | |||||
Impairment losses | (1 | ) | (1,857 | ) | ||||
General, administrative and leasing expenses | — | (1 | ) | |||||
Interest expense | — | (2,081 | ) | |||||
Loss on sales of real estate | (4 | ) | — | |||||
Loss on early extinguishment of debt | (23 | ) | — | |||||
Discontinued operations | $ | 11 | $ | 1,261 | ||||
Earnings_Per_Share_EPS_and_Ear
Earnings Per Share ("EPS") and Earnings Per Unit ("EPU") | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Earnings Per Share (“EPSâ€) and Earnings Per Unit (“EPUâ€) | ' | ||||||||
Earnings Per Share (“EPS”) and Earnings Per Unit (“EPU”) | |||||||||
COPT and Subsidiaries EPS | |||||||||
We present both basic and diluted EPS. We compute basic EPS by dividing net income available to common shareholders allocable to unrestricted common shares under the two-class method by the weighted average number of unrestricted common shares outstanding during the period. Our computation of diluted EPS is similar except that: | |||||||||
• | the denominator is increased to include: (1) the weighted average number of potential additional common shares that would have been outstanding if securities that are convertible into COPT common shares were converted; and (2) the effect of dilutive potential common shares outstanding during the period attributable to share-based compensation using the treasury stock or if-converted methods; and | ||||||||
• | the numerator is adjusted to add back any changes in income or loss that would result from the assumed conversion into common shares that we added to the denominator. | ||||||||
Summaries of the numerator and denominator for purposes of basic and diluted EPS calculations are set forth below (in thousands, except per share data): | |||||||||
For the Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Numerator: | |||||||||
Income from continuing operations | $ | 5,660 | $ | 11,662 | |||||
Gain on sales of real estate, net | — | 2,354 | |||||||
Preferred share dividends | (4,490 | ) | (6,106 | ) | |||||
Income from continuing operations attributable to noncontrolling interests | (932 | ) | (167 | ) | |||||
Income from continuing operations attributable to restricted shares | (121 | ) | (118 | ) | |||||
Numerator for basic and diluted EPS from continuing operations attributable to COPT common shareholders | $ | 117 | $ | 7,625 | |||||
Discontinued operations | 11 | 1,261 | |||||||
Discontinued operations attributable to noncontrolling interests | 2 | (90 | ) | ||||||
Numerator for basic and diluted EPS on net income attributable to COPT common shareholders | $ | 130 | $ | 8,796 | |||||
Denominator (all weighted averages): | |||||||||
Denominator for basic EPS (common shares) | 87,080 | 81,397 | |||||||
Dilutive effect of share-based compensation awards | 112 | 52 | |||||||
Denominator for diluted EPS (common shares) | 87,192 | 81,449 | |||||||
Basic EPS: | |||||||||
Income from continuing operations attributable to COPT common shareholders | $ | 0 | $ | 0.09 | |||||
Discontinued operations attributable to COPT common shareholders | 0 | 0.02 | |||||||
Net income attributable to COPT common shareholders | $ | 0 | $ | 0.11 | |||||
Diluted EPS: | |||||||||
Income from continuing operations attributable to COPT common shareholders | $ | 0 | $ | 0.09 | |||||
Discontinued operations attributable to COPT common shareholders | 0 | 0.02 | |||||||
Net income attributable to COPT common shareholders | $ | 0 | $ | 0.11 | |||||
Our diluted EPS computations do not include the effects of the following securities since the conversions of such securities would increase diluted EPS for the respective periods (in thousands): | |||||||||
Weighted Average Shares Excluded from Denominator | |||||||||
For the Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Conversion of common units | 3,958 | 3,893 | |||||||
Conversion of Series I Preferred Units | 176 | 176 | |||||||
Conversion of Series K Preferred Shares | 434 | 434 | |||||||
The following share-based compensation securities were excluded from the computation of diluted EPS because their effect was antidilutive: | |||||||||
• | weighted average restricted shares for the three months ended March 31, 2014 and 2013 of 390,000 and 409,000, respectively, and | ||||||||
• | weighted average options for the three months ended March 31, 2014 and 2013 of 588,000 and 621,000, respectively. | ||||||||
As discussed in Note 8, we have outstanding senior notes that have an exchange settlement feature, but such notes did not affect our diluted EPS reported above since the weighted average closing price of COPT’s common shares during each of the periods was less than the exchange prices per common share applicable for such periods. | |||||||||
COPLP and Subsidiaries EPU | |||||||||
We present both basic and diluted EPU. We compute basic EPU by dividing net income available to common unitholders allocable to unrestricted common units under the two-class method by the weighted average number of unrestricted common units outstanding during the period. Our computation of diluted EPU is similar except that: | |||||||||
• | the denominator is increased to include: (1) the weighted average number of potential additional common units that would have been outstanding if securities that are convertible into our common units were converted; and (2) the effect of dilutive potential common units outstanding during the period attributable to share-based compensation using the treasury stock or if-converted methods; and | ||||||||
• | the numerator is adjusted to add back any changes in income or loss that would result from the assumed conversion into common units that we added to the denominator. | ||||||||
Summaries of the numerator and denominator for purposes of basic and diluted EPU calculations are set forth below (in thousands, except per unit data): | |||||||||
For the Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Numerator: | |||||||||
Income from continuing operations | $ | 5,660 | $ | 11,662 | |||||
Gain on sales of real estate, net | — | 2,354 | |||||||
Preferred unit distributions | (4,655 | ) | (6,271 | ) | |||||
(Income) loss from continuing operations attributable to noncontrolling interests | (739 | ) | 369 | ||||||
Income from continuing operations attributable to restricted units | (121 | ) | (118 | ) | |||||
Numerator for basic and diluted EPU from continuing operations attributable to COPLP common unitholders | $ | 145 | $ | 7,996 | |||||
Discontinued operations | 11 | 1,261 | |||||||
Discontinued operations attributable to noncontrolling interests | 2 | (33 | ) | ||||||
Numerator for basic and diluted EPU on net income attributable to COPLP common unitholders | $ | 158 | $ | 9,224 | |||||
Denominator (all weighted averages): | |||||||||
Denominator for basic EPU (common units) | 91,038 | 85,290 | |||||||
Dilutive effect of share-based compensation awards | 112 | 52 | |||||||
Denominator for basic and diluted EPU (common units) | 91,150 | 85,342 | |||||||
Basic EPU: | |||||||||
Income from continuing operations attributable to COPLP common unitholders | $ | 0 | $ | 0.09 | |||||
Discontinued operations attributable to COPLP common unitholders | 0 | 0.02 | |||||||
Net income attributable to COPLP common unitholders | $ | 0 | $ | 0.11 | |||||
Diluted EPU: | |||||||||
Income from continuing operations attributable to COPLP common unitholders | $ | 0 | $ | 0.09 | |||||
Discontinued operations attributable to COPLP common unitholders | 0 | 0.02 | |||||||
Net income attributable to COPLP common unitholders | $ | 0 | $ | 0.11 | |||||
Our diluted EPU computations do not include the effects of the following securities since the conversions of such securities would increase diluted EPU for the respective periods (in thousands): | |||||||||
Weighted Average Units Excluded from Denominator | |||||||||
For the Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Conversion of Series I preferred units | 176 | 176 | |||||||
Conversion of Series K preferred units | 434 | 434 | |||||||
The following share-based compensation securities were excluded from the computation of diluted EPU because their effect was antidilutive: | |||||||||
• | weighted average restricted units for the three months ended March 31, 2014 and 2013 of 390,000 and 409,000, respectively; and | ||||||||
• | weighted average options for the three months ended March 31, 2014 and 2013 of 588,000 and 621,000, respectively. | ||||||||
As discussed in Note 8, we have outstanding senior notes that have an exchange settlement feature, but such notes did not affect our diluted EPU reported above since the weighted average closing price of COPT’s common shares during each of the periods was less than the exchange prices per common share applicable for such periods. |
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended | |
Mar. 31, 2014 | ||
Commitments and Contingencies Disclosure [Abstract] | ' | |
Commitments and Contingencies | ' | |
Commitments and Contingencies | ||
Litigation | ||
In the normal course of business, we are involved in legal actions arising from our ownership and administration of properties. We establish reserves for specific legal proceedings when we determine that the likelihood of an unfavorable outcome is probable and the amount of loss can be reasonably estimated. Management does not anticipate that any liabilities that may result from such proceedings will have a materially adverse effect on our financial position, operations or liquidity. Our assessment of the potential outcomes of these matters involves significant judgment and is subject to change based on future developments. | ||
Environmental | ||
We are subject to various Federal, state and local environmental regulations related to our property ownership and operation. We have performed environmental assessments of our properties, the results of which have not revealed any environmental liability that we believe would have a materially adverse effect on our financial position, operations or liquidity. | ||
Joint Ventures | ||
In connection with our 2005 contribution of properties to an unconsolidated partnership in which we hold a joint venture interest, we entered into standard nonrecourse loan guarantees (environmental indemnifications and guarantees against fraud and misrepresentation, and springing guarantees of partnership debt in the event of a voluntary bankruptcy of the partnership). On December 6, 2013, the holder of mortgage debt encumbering all of the joint venture’s properties foreclosed on the properties. As a result, title to the properties was transferred to the mortgage lender and the joint venture was relieved of the debt obligation plus accrued interest and penalties. The joint venture still had $5.6 million in nonrecourse mezzanine debt as of March 31, 2014; however, the joint venture no longer holds any property and has ceased all business operations. Management estimates there to be no fair value to the guarantees as of March 31, 2014 because the actions that would trigger performance are all within our control. | ||
Tax Incremental Financing Obligation | ||
In August 2010, Anne Arundel County, Maryland issued $30 million in tax incremental financing bonds to third-party investors in order to finance public improvements needed in connection with our project known as National Business Park North. The real estate taxes on increases in assessed value of a development district encompassing National Business Park North are to be transferred to a special fund pledged to the repayment of the bonds. We recognized a $1.9 million liability through March 31, 2014 representing our estimated obligation to fund through a special tax any future shortfalls between debt service on the bonds and real estate taxes available to repay the bonds. | ||
Environmental Indemnity Agreement | ||
We agreed to provide certain environmental indemnifications in connection with a lease and subsequent sale of three New Jersey properties. The prior owner of the properties, a Fortune 100 company that is responsible for groundwater contamination at such properties, previously agreed to indemnify us for (1) direct losses incurred in connection with the contamination and (2) its failure to perform remediation activities required by the State of New Jersey, up to the point that the state declares the remediation to be complete. Under the environmental indemnification agreement, we agreed to the following: | ||
• | to indemnify the tenant against losses covered under the prior owner’s indemnity agreement if the prior owner fails to indemnify the tenant for such losses. This indemnification is capped at $5.0 million in perpetuity after the State of New Jersey declares the remediation to be complete; | |
• | to indemnify the tenant for consequential damages (e.g., business interruption) at one of the buildings in perpetuity and another of the buildings through 2025. This indemnification is limited to $12.5 million; and | |
• | to pay 50% of additional costs related to construction and environmental regulatory activities incurred by the tenant as a result of the indemnified environmental condition of the properties. This indemnification is limited to $300,000 annually and $1.5 million in the aggregate. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation | ' |
Basis of Presentation | |
The COPT consolidated financial statements include the accounts of COPT, the Operating Partnership, their subsidiaries and other entities in which COPT has a majority voting interest and control. The COPLP consolidated financial statements include the accounts of COPLP, its subsidiaries and other entities in which COPLP has a majority voting interest and control. We also consolidate certain entities when control of such entities can be achieved through means other than voting rights (“variable interest entities” or “VIEs”) if they are deemed to be the primary beneficiary of such entities. We eliminate all significant intercompany balances and transactions in consolidation. | |
We use the equity method of accounting when we own an interest in an entity and can exert significant influence over the entity’s operations but cannot control the entity’s operations. We discontinue equity method accounting if our investment in an entity (and net advances) is reduced to zero unless we have guaranteed obligations of the entity or are otherwise committed to provide further financial support for the entity. | |
These interim financial statements should be read together with the consolidated financial statements and notes thereto as of and for the year ended December 31, 2013 included in our 2013 Annual Report on Form 10-K. The unaudited consolidated financial statements include all adjustments that are necessary, in the opinion of management, to fairly present our financial position and results of operations. All adjustments are of a normal recurring nature. The consolidated financial statements have been prepared using the accounting policies described in our 2013 Annual Report on Form 10-K. | |
Reclassifications | ' |
Reclassifications | |
We reclassified certain amounts from prior periods to conform to the current period presentation of our consolidated financial statements with no effect on previously reported net income or equity. These reclassifications occurred in conjunction with the transfer of properties to, and from, discontinued operations during 2013. | |
Recent Accounting Pronouncement | ' |
Recent Accounting Pronouncement | |
In April 2014, the Financial Accounting Standards Board (“FASB”) issued guidance related to the reporting of discontinued operation and disclosures of disposals of components of an entity. This guidance defines a discontinued operation as a component or group of components disposed or classified as held for sale and represents a strategic shift that has (or will have) a major effect on an entity’s operations and final result; the guidance states that a strategic shift could include a disposal of a major geographical area of operations, a major line of business, a major equity method investment or other major parts of an entity. The guidance also provides for additional disclosure requirements in connection with both discontinued operations and other dispositions not qualifying as discontinued operations. The guidance will be effective for annual and interim periods beginning on or after December 15, 2014. The guidance applies prospectively to new disposals and new classifications of disposal groups as held for sale after the effective date. All entities may early adopt the guidance for new disposals (or new classifications as held for sale) that have not been reported in financial statements previously issued or available for issuance. We are in the process of evaluating this guidance. |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 3 Months Ended | ||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||||||
Schedule of fair value assets and liabilities measured on recurring basis | ' | ||||||||||||||||||||
The table below sets forth financial assets and liabilities of COPT and its subsidiaries that are accounted for at fair value on a recurring basis as of March 31, 2014 and the hierarchy level of inputs used in measuring their respective fair values under applicable accounting standards (in thousands): | |||||||||||||||||||||
Description | Quoted Prices in | Significant Other | Significant | Total | |||||||||||||||||
Active Markets for | Observable Inputs(Level 2) | Unobservable Inputs(Level 3) | |||||||||||||||||||
Identical Assets(Level 1) | |||||||||||||||||||||
Assets: | |||||||||||||||||||||
Marketable securities in deferred compensation plan (1) | |||||||||||||||||||||
Mutual funds | $ | 7,249 | $ | — | $ | — | $ | 7,249 | |||||||||||||
Common stocks | 115 | — | — | 115 | |||||||||||||||||
Other | 201 | — | — | 201 | |||||||||||||||||
Interest rate derivatives (2) | — | 5,038 | — | 5,038 | |||||||||||||||||
Warrants to purchase common stock (2) | — | 537 | — | 537 | |||||||||||||||||
Total Assets | $ | 7,565 | $ | 5,575 | $ | — | $ | 13,140 | |||||||||||||
Liabilities: | |||||||||||||||||||||
Deferred compensation plan liability (3) | $ | — | $ | 7,565 | $ | — | $ | 7,565 | |||||||||||||
Interest rate derivatives | — | 3,196 | — | 3,196 | |||||||||||||||||
Total Liabilities | $ | — | $ | 10,761 | $ | — | $ | 10,761 | |||||||||||||
Redeemable noncontrolling interest | $ | — | $ | — | $ | 17,654 | $ | 17,654 | |||||||||||||
(1) Included in the line entitled “restricted cash and marketable securities” on COPT’s consolidated balance sheet. | |||||||||||||||||||||
(2) Included in the line entitled “prepaid expenses and other assets” on COPT’s consolidated balance sheet. | |||||||||||||||||||||
(3) Included in the line entitled “other liabilities” on COPT’s consolidated balance sheet. | |||||||||||||||||||||
The table below sets forth financial assets and liabilities of COPLP and its subsidiaries that are accounted for at fair value on a recurring basis as of March 31, 2014 and the hierarchy level of inputs used in measuring their respective fair values under applicable accounting standards (in thousands): | |||||||||||||||||||||
Description | Quoted Prices in | Significant Other | Significant | Total | |||||||||||||||||
Active Markets for | Observable Inputs(Level 2) | Unobservable Inputs(Level 3) | |||||||||||||||||||
Identical Assets(Level 1) | |||||||||||||||||||||
Assets: | |||||||||||||||||||||
Interest rate derivatives (1) | $ | — | $ | 5,038 | $ | — | $ | 5,038 | |||||||||||||
Warrants to purchase common stock (1) | — | 537 | — | 537 | |||||||||||||||||
Total Assets | $ | — | $ | 5,575 | $ | — | $ | 5,575 | |||||||||||||
Liabilities: | |||||||||||||||||||||
Interest rate derivatives | $ | — | $ | 3,196 | $ | — | $ | 3,196 | |||||||||||||
Redeemable noncontrolling interest | $ | — | $ | — | $ | 17,654 | $ | 17,654 | |||||||||||||
(1) Included in the line entitled “prepaid expenses and other assets” on COPLP’s consolidated balance sheet. | |||||||||||||||||||||
Schedule of fair value hierarchy of impaired properties and other assets associated with such properties | ' | ||||||||||||||||||||
The table below sets forth the fair value hierarchy of the valuation techniques used by us in determining the fair value of the property (dollars in thousands): | |||||||||||||||||||||
Fair Value of Property Held as of March 31, 2013 | Impairment Losses | ||||||||||||||||||||
Quoted Prices in | Significant | Recognized in | |||||||||||||||||||
Active Markets for | Significant Other | Unobservable | Three Months | ||||||||||||||||||
Identical Assets | Observable Inputs | Inputs | Ended | ||||||||||||||||||
Description | (Level 1) | (Level 2) | (Level 3) | Total | 31-Mar-13 | ||||||||||||||||
Assets: | |||||||||||||||||||||
Properties, net | $ | — | $ | — | $ | 7,250 | $ | 7,250 | $ | 1,857 | |||||||||||
Schedule of quantitative information about significant unobservable inputs used for Level 3 fair value measurements | ' | ||||||||||||||||||||
The table below sets forth quantitative information about significant unobservable inputs used for the Level 3 fair value measurements reported above as of March 31, 2013 (dollars in thousands): | |||||||||||||||||||||
Valuation Technique | Fair Value on | Unobservable Input | Range (Weighted Average) | ||||||||||||||||||
Measurement Date | |||||||||||||||||||||
Bids for property indicative of value | $ | 7,250 | Indicative bid | -1 | |||||||||||||||||
(1) This fair value measurement was developed as a result of negotiations between us and a purchaser of a property. |
Properties_net_Tables
Properties, net (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Real Estate [Abstract] | ' | |||||||
Schedule of operating properties, net | ' | |||||||
Operating properties, net consisted of the following (in thousands): | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
Land | $ | 436,381 | $ | 430,472 | ||||
Buildings and improvements | 2,927,800 | 2,869,870 | ||||||
Less: accumulated depreciation | (635,178 | ) | (597,649 | ) | ||||
Operating properties, net | $ | 2,729,003 | $ | 2,702,693 | ||||
Schedule of projects in development or held for future development | ' | |||||||
Projects we had in development or held for future development consisted of the following (in thousands): | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
Land | $ | 238,904 | $ | 245,676 | ||||
Construction in progress, excluding land | 256,721 | 265,932 | ||||||
Projects in development or held for future development | $ | 495,625 | $ | 511,608 | ||||
Real_Estate_Joint_Ventures_Tab
Real Estate Joint Ventures (Tables) | 3 Months Ended | ||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||
Equity Method Investments and Joint Ventures [Abstract] | ' | ||||||||||||||||||
Schedule of information related to investments in consolidated real estate joint ventures | ' | ||||||||||||||||||
The table below sets forth information pertaining to our investments in consolidated real estate joint ventures as of March 31, 2014 (dollars in thousands): | |||||||||||||||||||
Nominal | |||||||||||||||||||
Ownership | March 31, 2014 | -1 | |||||||||||||||||
Date | % as of | Total | Encumbered | Total | |||||||||||||||
Acquired | 3/31/14 | Nature of Activity | Assets | Assets | Liabilities | ||||||||||||||
LW Redstone Company, LLC | 3/23/10 | 85% | Operates four buildings and developing others (2) | $ | 135,231 | $ | 68,360 | $ | 36,272 | ||||||||||
M Square Associates, LLC | 6/26/07 | 50% | Operates two buildings and developing others (3) | 60,728 | 48,358 | 40,536 | |||||||||||||
COPT-FD Indian Head, LLC | 10/23/06 | 75% | Holding land parcel (4) | 6,436 | — | — | |||||||||||||
$ | 202,395 | $ | 116,718 | $ | 76,808 | ||||||||||||||
-1 | Excludes amounts eliminated in consolidation. | ||||||||||||||||||
-2 | This joint venture’s property is in Huntsville, Alabama. | ||||||||||||||||||
-3 | This joint venture’s properties are in College Park, Maryland (in the Baltimore/Washington Corridor). | ||||||||||||||||||
-4 | This joint venture’s property is in Charles County, Maryland. In 2012, the joint venture exercised its option under a development agreement to require Charles County to repurchase the land parcel at its original acquisition cost. Under the terms of the agreement with Charles County, the repurchase is expected to occur by August 2014. |
Mortgage_and_Other_Investing_R1
Mortgage and Other Investing Receivables (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Receivables [Abstract] | ' | |||||||
Mortgage and other investing receivables | ' | |||||||
Mortgage and other investing receivables, including accrued interest thereon, consisted of the following (in thousands): | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
Notes receivable from City of Huntsville | $ | 45,381 | $ | 44,055 | ||||
Mortgage loan receivable | 9,850 | 9,608 | ||||||
$ | 55,231 | $ | 53,663 | |||||
Prepaid_Expenses_and_Other_Ass1
Prepaid Expenses and Other Assets (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Prepaid Expense and Other Assets [Abstract] | ' | |||||||
Schedule of prepaid expenses and other assets | ' | |||||||
Prepaid expenses and other assets consisted of the following (in thousands): | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
Prepaid expenses | $ | 13,813 | $ | 19,308 | ||||
Lease incentives | 11,900 | 8,435 | ||||||
Furniture, fixtures and equipment, net | 7,068 | 6,556 | ||||||
Interest rate derivatives | 5,038 | 6,594 | ||||||
Construction contract costs incurred in excess of billings | 4,990 | 2,462 | ||||||
Deferred tax asset, net (1) | 4,241 | 4,305 | ||||||
Other equity method investments | 2,266 | 2,258 | ||||||
Other assets | 4,616 | 4,268 | ||||||
Prepaid expenses and other assets | $ | 53,932 | $ | 54,186 | ||||
(1) Includes a valuation allowance of $2.1 million. |
Debt_Tables
Debt (Tables) | 3 Months Ended | |||||||||||||||
Mar. 31, 2014 | ||||||||||||||||
Debt Disclosure [Abstract] | ' | |||||||||||||||
Schedule of debt | ' | |||||||||||||||
Our debt consisted of the following (dollars in thousands): | ||||||||||||||||
Maximum | ||||||||||||||||
Availability at | Carrying Value at | Scheduled Maturity | ||||||||||||||
March 31, | March 31, | December 31, | Stated Interest Rates as of | as of | ||||||||||||
2014 | 2014 | 2013 | March 31, 2014 | March 31, 2014 | ||||||||||||
Mortgage and Other Secured Loans: | ||||||||||||||||
Fixed rate mortgage loans (1) | -2 | $ | 679,260 | $ | 675,060 | 3.96% - 7.87% (3) | 2014-2024 | |||||||||
Variable rate secured loan | 37,491 | 37,691 | LIBOR + 2.25% (4) | Nov-15 | ||||||||||||
Total mortgage and other secured loans | 716,751 | 712,751 | ||||||||||||||
Revolving Credit Facility (5) | $ | 800,000 | — | — | LIBOR + 0.975% to 1.75% | Jul-17 | ||||||||||
Term Loan Facilities | -6 | 620,000 | 620,000 | LIBOR + 1.10% to 2.60% (7) | 2015-2019 | |||||||||||
Unsecured Senior Notes | ||||||||||||||||
3.600% Senior Notes (8) | 347,306 | 347,244 | 3.60% | May-23 | ||||||||||||
5.250% Senior Notes (9) | 245,532 | 245,445 | 5.25% | Feb-24 | ||||||||||||
Unsecured notes payable | 1,677 | 1,700 | 0% (10) | 2026 | ||||||||||||
4.25% Exchangeable Senior Notes (11) | 565 | 563 | 4.25% | Apr-30 | ||||||||||||
Total debt, net | $ | 1,931,831 | $ | 1,927,703 | ||||||||||||
(1) | Several of the fixed rate mortgages carry interest rates that were above or below market rates upon assumption and therefore were recorded at their fair value based on applicable effective interest rates. The carrying values of these loans reflect net unamortized premiums totaling $62,000 as of March 31, 2014 and $69,000 as of December 31, 2013. | |||||||||||||||
-2 | Includes $19.8 million balance on construction loans with maximum available borrowings of $26.2 million. | |||||||||||||||
-3 | The weighted average interest rate on these loans was 6.12% as of March 31, 2014. | |||||||||||||||
(4) | The interest rate on the loan outstanding was 2.41% as of March 31, 2014. | |||||||||||||||
-5 | No borrowings were outstanding on this facility during the three months ended March 31, 2014. | |||||||||||||||
(6) | We have the ability to borrow an aggregate of an additional $180.0 million under these term loan facilities, provided that there is no default under the facilities and subject to the approval of the lenders. | |||||||||||||||
(7) | The weighted average interest rate on these loans was 1.78% as of March 31, 2014. | |||||||||||||||
-8 | The carrying value of these notes included a principal amount of $350.0 million and an unamortized discount totaling $2.7 million as of March 31, 2014 and $2.8 million as of December 31, 2013. The effective interest rate under the notes, including amortization of the issuance costs, was 3.70%. | |||||||||||||||
-9 | The carrying value of these notes included a principal amount of $250.0 million and an unamortized discount totaling $4.5 million as of March 31, 2014 and $4.6 million as of December 31, 2013. The effective interest rate under the notes, including amortization of the issuance costs, was 5.49%. | |||||||||||||||
(10) | These notes carry interest rates that were below market rates upon assumption and therefore were recorded at their fair value based on applicable effective interest rates. The carrying value of these notes reflects an unamortized discount totaling $734,000 as of March 31, 2014 and $761,000 as of December 31, 2013. | |||||||||||||||
(11) | As described further in our 2013 Annual Report on Form 10-K, these notes have an exchange settlement feature that provides that the notes may, under certain circumstances, be exchangeable for cash and, at COPLP’s discretion, COPT common shares at an exchange rate (subject to adjustment) of 20.8513 shares per one thousand dollar principal amount of the notes (exchange rate is as of March 31, 2014 and is equivalent to an exchange price of $47.96 per common share). The carrying value of these notes included a principal amount of $575,000 and an unamortized discount totaling $10,000 as of March 31, 2014 and $12,000 as of December 31, 2013. The effective interest rate under the notes, including amortization of the issuance costs, was 6.05%. Because the closing price of our common shares as of March 31, 2014 and December 31, 2013 was less than the exchange price per common share applicable to these notes, the if-converted value of the notes did not exceed the principal amount. The table below sets forth interest expense recognized on these notes before deductions for amounts capitalized (in thousands): | |||||||||||||||
For the Three Months Ended March 31, | ||||||||||||||||
2014 | 2013 | |||||||||||||||
Interest expense at stated interest rate | $ | 6 | $ | 2,304 | ||||||||||||
Interest expense associated with amortization of discount | 3 | 864 | ||||||||||||||
Total | $ | 9 | $ | 3,168 | ||||||||||||
Schedule of the fair value of debt | ' | |||||||||||||||
The following table sets forth information pertaining to the fair value of our debt (in thousands): | ||||||||||||||||
March 31, 2014 | December 31, 2013 | |||||||||||||||
Carrying | Estimated | Carrying | Estimated | |||||||||||||
Amount | Fair Value | Amount | Fair Value | |||||||||||||
Fixed-rate debt | ||||||||||||||||
Unsecured Senior Notes | $ | 592,838 | $ | 584,178 | $ | 592,689 | $ | 575,374 | ||||||||
4.25% Exchangeable Senior Notes | 565 | 575 | 563 | 575 | ||||||||||||
Other fixed-rate debt | 680,937 | 668,949 | 676,760 | 650,997 | ||||||||||||
Variable-rate debt | 657,491 | 657,420 | 657,691 | 657,527 | ||||||||||||
$ | 1,931,831 | $ | 1,911,122 | $ | 1,927,703 | $ | 1,884,473 | |||||||||
Interest_Rate_Derivatives_Tabl
Interest Rate Derivatives (Tables) | 3 Months Ended | ||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||||
Schedule of key terms and fair values of interest rate swap derivatives | ' | ||||||||||||||||||
The following table sets forth the key terms and fair values of our interest rate swap derivatives (dollars in thousands): | |||||||||||||||||||
Fair Value at | |||||||||||||||||||
Notional Amount | Fixed Rate | Floating Rate Index | Effective Date | Expiration Date | March 31, | December 31, | |||||||||||||
2014 | 2013 | ||||||||||||||||||
$ | 100,000 | 0.61% | One-Month LIBOR | 1/3/12 | 9/1/14 | $ | (195 | ) | $ | (279 | ) | ||||||||
100,000 | 0.61% | One-Month LIBOR | 1/3/12 | 9/1/14 | (194 | ) | (277 | ) | |||||||||||
100,000 | 0.83% | One-Month LIBOR | 1/3/12 | 9/1/15 | (807 | ) | (861 | ) | |||||||||||
100,000 | 0.83% | One-Month LIBOR | 1/3/12 | 9/1/15 | (807 | ) | (861 | ) | |||||||||||
37,491 | -1 | 3.83% | One-Month LIBOR + 2.25% | 11/2/10 | 11/2/15 | (742 | ) | (832 | ) | ||||||||||
100,000 | 0.81% | One-Month LIBOR | 9/2/14 | 9/1/16 | (220 | ) | (94 | ) | |||||||||||
100,000 | 0.81% | One-Month LIBOR | 9/2/14 | 9/1/16 | (231 | ) | (105 | ) | |||||||||||
100,000 | 1.67% | One-Month LIBOR | 9/1/15 | 8/1/19 | 2,604 | 3,377 | |||||||||||||
100,000 | 1.73% | One-Month LIBOR | 9/1/15 | 8/1/19 | 2,434 | 3,217 | |||||||||||||
$ | 1,842 | $ | 3,285 | ||||||||||||||||
-1 | The notional amount of this instrument is scheduled to amortize to $36.2 million. | ||||||||||||||||||
Schedule of fair value and balance sheet classification of interest rate derivatives | ' | ||||||||||||||||||
The table below sets forth the fair value of our interest rate derivatives as well as their classification on our consolidated balance sheet (in thousands): | |||||||||||||||||||
March 31, 2014 | 31-Dec-13 | ||||||||||||||||||
Derivatives | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||||||||
Interest rate swaps designated as cash flow hedges | Prepaid expenses and other assets | $ | 5,038 | Prepaid expenses and other assets | $ | 6,594 | |||||||||||||
Interest rate swaps designated as cash flow hedges | Interest rate derivatives | (3,196 | ) | Interest rate derivatives | (3,309 | ) | |||||||||||||
Schedule of effect of interest rate derivatives on consolidated statements of operations and comprehensive income | ' | ||||||||||||||||||
The table below presents the effect of our interest rate derivatives on our consolidated statements of operations and comprehensive income (in thousands): | |||||||||||||||||||
For the Three Months Ended March 31, | |||||||||||||||||||
2014 | 2013 | ||||||||||||||||||
Amount of (losses) gains recognized in accumulated other comprehensive income (loss) (“AOCI”) (effective portion) | $ | (2,123 | ) | $ | 462 | ||||||||||||||
Amount of losses reclassified from AOCI into interest expense (effective portion) | 695 | 658 | |||||||||||||||||
Redeemable_Noncontrolling_Inte1
Redeemable Noncontrolling Interest (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Noncontrolling Interest [Abstract] | ' | ||||||||
Schedule of activity for redeemable noncontrolling interest | ' | ||||||||
The table below sets forth activity in a redeemable noncontrolling interest in a consolidated real estate joint venture (in thousands): | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Beginning balance | $ | 17,758 | $ | 10,298 | |||||
Distribution to noncontrolling interest | (68 | ) | — | ||||||
Net income (loss) attributable to noncontrolling interest | 504 | (790 | ) | ||||||
Adjustment to arrive at fair value of interest | (540 | ) | 848 | ||||||
Ending balance | $ | 17,654 | $ | 10,356 | |||||
Information_by_Business_Segmen1
Information by Business Segment (Tables) | 3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||||||||||||||||||||||||||||||||||
Schedule of segment financial information for real estate operations | ' | |||||||||||||||||||||||||||||||||||||||||||||||
The table below reports segment financial information for our reportable segments (in thousands). We measure the performance of our segments through the measure we define as NOI from real estate operations, which is derived by subtracting property operating expenses from revenues from real estate operations. | ||||||||||||||||||||||||||||||||||||||||||||||||
Operating Office Property Segments | ||||||||||||||||||||||||||||||||||||||||||||||||
Baltimore/ | Northern | San | Huntsville | Washington, | St. Mary’s & | Greater | Greater | Colorado | Other | Operating | Total | |||||||||||||||||||||||||||||||||||||
Washington | Virginia | Antonio | DC - Capitol | King George | Baltimore | Philadelphia | Springs | Wholesale | ||||||||||||||||||||||||||||||||||||||||
Corridor | Riverfront | Counties | Data Center | |||||||||||||||||||||||||||||||||||||||||||||
Three Months Ended March 31, 2014 | ||||||||||||||||||||||||||||||||||||||||||||||||
Revenues from real estate operations | $ | 61,113 | $ | 24,968 | $ | 8,479 | $ | 2,555 | $ | 3,634 | $ | 4,316 | $ | 11,496 | $ | 3,340 | $ | 18 | $ | 2,576 | $ | 2,401 | $ | 124,896 | ||||||||||||||||||||||||
Property operating expenses | 23,597 | 8,973 | 4,474 | 653 | 1,765 | 1,504 | 5,476 | 1,300 | (9 | ) | 331 | 1,688 | 49,752 | |||||||||||||||||||||||||||||||||||
NOI from real estate operations | $ | 37,516 | $ | 15,995 | $ | 4,005 | $ | 1,902 | $ | 1,869 | $ | 2,812 | $ | 6,020 | $ | 2,040 | $ | 27 | $ | 2,245 | $ | 713 | $ | 75,144 | ||||||||||||||||||||||||
Additions to long-lived assets | $ | 5,741 | $ | 3,495 | $ | (6 | ) | $ | 2,507 | $ | 63 | $ | 839 | $ | 1,012 | $ | 11 | $ | — | $ | 55 | $ | 12 | $ | 13,729 | |||||||||||||||||||||||
Transfers from non-operating properties | $ | (169 | ) | $ | 26,588 | $ | — | $ | 20,102 | $ | — | $ | — | $ | 7,154 | $ | 3,176 | $ | 11 | $ | — | $ | 78 | $ | 56,940 | |||||||||||||||||||||||
Segment assets at March 31, 2014 | $ | 1,237,796 | $ | 636,895 | $ | 117,812 | $ | 99,378 | $ | 97,843 | $ | 95,645 | $ | 307,699 | $ | 94,428 | $ | 7 | $ | 79,535 | $ | 165,711 | $ | 2,932,749 | ||||||||||||||||||||||||
Three Months Ended March 31, 2013 | ||||||||||||||||||||||||||||||||||||||||||||||||
Revenues from real estate operations | $ | 58,660 | $ | 22,942 | $ | 7,757 | $ | 740 | $ | 4,244 | $ | 3,992 | $ | 10,719 | $ | 2,487 | $ | 6,682 | $ | 2,501 | $ | 1,353 | $ | 122,077 | ||||||||||||||||||||||||
Property operating expenses | 20,053 | 7,817 | 3,888 | 182 | 1,949 | 1,193 | 4,168 | 838 | 2,437 | 225 | 1,316 | 44,066 | ||||||||||||||||||||||||||||||||||||
NOI from real estate operations | $ | 38,607 | $ | 15,125 | $ | 3,869 | $ | 558 | $ | 2,295 | $ | 2,799 | $ | 6,551 | $ | 1,649 | $ | 4,245 | $ | 2,276 | $ | 37 | $ | 78,011 | ||||||||||||||||||||||||
Additions to long-lived assets | $ | 2,760 | $ | 1,544 | $ | 10 | $ | — | $ | 157 | $ | 275 | $ | 702 | $ | — | $ | 315 | $ | 91 | $ | — | $ | 5,854 | ||||||||||||||||||||||||
Transfers from non-operating properties | $ | 22,997 | $ | 9,839 | $ | — | $ | 24,240 | $ | — | $ | 6 | $ | 113 | $ | 7,050 | $ | 1,783 | $ | — | $ | 65,568 | $ | 131,596 | ||||||||||||||||||||||||
Segment assets at March 31, 2013 | $ | 1,279,794 | $ | 574,970 | $ | 119,145 | $ | 52,361 | $ | 102,928 | $ | 97,346 | $ | 317,953 | $ | 85,017 | $ | 177,728 | $ | 81,714 | $ | 166,920 | $ | 3,055,876 | ||||||||||||||||||||||||
Schedule of reconciliation of segment revenues to total revenues | ' | |||||||||||||||||||||||||||||||||||||||||||||||
The following table reconciles our segment revenues to total revenues as reported on our consolidated statements of operations (in thousands): | ||||||||||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, | ||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||||||||||||||||||
Segment revenues from real estate operations | $ | 124,896 | $ | 122,077 | ||||||||||||||||||||||||||||||||||||||||||||
Construction contract and other service revenues | 21,790 | 14,262 | ||||||||||||||||||||||||||||||||||||||||||||||
Less: Revenues from discontinued operations (Note 15) | (19 | ) | (10,120 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Total revenues | $ | 146,667 | $ | 126,219 | ||||||||||||||||||||||||||||||||||||||||||||
Schedule of reconciliation of segment property operating expenses to total property operating expenses | ' | |||||||||||||||||||||||||||||||||||||||||||||||
The following table reconciles our segment property operating expenses to property operating expenses as reported on our consolidated statements of operations (in thousands): | ||||||||||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, | ||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||||||||||||||||||
Segment property operating expenses | $ | 49,752 | $ | 44,066 | ||||||||||||||||||||||||||||||||||||||||||||
Less: Property operating expenses from discontinued operations (Note 15) | 20 | (3,678 | ) | |||||||||||||||||||||||||||||||||||||||||||||
Total property operating expenses | $ | 49,772 | $ | 40,388 | ||||||||||||||||||||||||||||||||||||||||||||
Schedule of computation of net operating income from service operations | ' | |||||||||||||||||||||||||||||||||||||||||||||||
The table below sets forth the computation of our NOI from service operations (in thousands): | ||||||||||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, | ||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||||||||||||||||||
Construction contract and other service revenues | $ | 21,790 | $ | 14,262 | ||||||||||||||||||||||||||||||||||||||||||||
Construction contract and other service expenses | (18,624 | ) | (13,477 | ) | ||||||||||||||||||||||||||||||||||||||||||||
NOI from service operations | $ | 3,166 | $ | 785 | ||||||||||||||||||||||||||||||||||||||||||||
Schedule of reconciliation of net operating income from real estate operations and service operations to (loss) income from continuing operations | ' | |||||||||||||||||||||||||||||||||||||||||||||||
The following table reconciles our NOI from real estate operations for reportable segments and NOI from service operations to income from continuing operations as reported on our consolidated statements of operations (in thousands): | ||||||||||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, | ||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||||||||||||||||||
NOI from real estate operations | $ | 75,144 | $ | 78,011 | ||||||||||||||||||||||||||||||||||||||||||||
NOI from service operations | 3,166 | 785 | ||||||||||||||||||||||||||||||||||||||||||||||
Interest and other income | 1,285 | 946 | ||||||||||||||||||||||||||||||||||||||||||||||
Equity in income of unconsolidated entities | 60 | 41 | ||||||||||||||||||||||||||||||||||||||||||||||
Income tax expense | (64 | ) | (16 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Other adjustments: | — | |||||||||||||||||||||||||||||||||||||||||||||||
Depreciation and other amortization associated with real estate operations | (43,596 | ) | (27,010 | ) | ||||||||||||||||||||||||||||||||||||||||||||
General, administrative and leasing expenses | (8,143 | ) | (7,820 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Business development expenses and land carry costs | (1,326 | ) | (1,359 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Interest expense on continuing operations | (20,827 | ) | (20,290 | ) | ||||||||||||||||||||||||||||||||||||||||||||
NOI from discontinued operations | (39 | ) | (6,442 | ) | ||||||||||||||||||||||||||||||||||||||||||||
Loss on early extinguishment of debt | — | (5,184 | ) | |||||||||||||||||||||||||||||||||||||||||||||
Income from continuing operations | $ | 5,660 | $ | 11,662 | ||||||||||||||||||||||||||||||||||||||||||||
Schedule of reconciliation of segment assets to total assets | ' | |||||||||||||||||||||||||||||||||||||||||||||||
The following table reconciles our segment assets to the consolidated total assets of COPT and subsidiaries (in thousands): | ||||||||||||||||||||||||||||||||||||||||||||||||
March 31, | March 31, | |||||||||||||||||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||||||||||||||||||
Segment assets | $ | 2,932,749 | $ | 3,055,876 | ||||||||||||||||||||||||||||||||||||||||||||
Non-operating property assets | 503,030 | 490,083 | ||||||||||||||||||||||||||||||||||||||||||||||
Other assets | 170,118 | 139,140 | ||||||||||||||||||||||||||||||||||||||||||||||
Total COPT consolidated assets | $ | 3,605,897 | $ | 3,685,099 | ||||||||||||||||||||||||||||||||||||||||||||
ShareBased_Compensation_Tables
Share-Based Compensation (Tables) | 3 Months Ended | ||
Mar. 31, 2014 | |||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||
Schedule of payouts for defined performance under performance-based awards of share-based compensation | ' | ||
The number of PSUs earned (“earned PSUs”) at the end of the performance period will be determined based on the percentile rank of COPT’s total shareholder return relative to a peer group of companies, as set forth in the following schedule: | |||
Percentile Rank | Earned PSUs Payout % | ||
75th or greater | 200% of PSUs granted | ||
50th or greater | 100% of PSUs granted | ||
25th | 50% of PSUs granted | ||
Below 25th | 0% of PSUs granted |
Income_Taxes_Tables
Income Taxes (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Income Tax Disclosure [Abstract] | ' | |||||||
Components of provision for income tax | ' | |||||||
Our TRS’s provision for income taxes consisted of the following (in thousands): | ||||||||
For the Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
Deferred | ||||||||
Federal | $ | (53 | ) | $ | (13 | ) | ||
State | (11 | ) | (3 | ) | ||||
Total income tax expense | $ | (64 | ) | $ | (16 | ) |
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | |||||||
Components of discontinued operations | ' | |||||||
The table below sets forth the components of discontinued operations reported on our consolidated statements of operations (in thousands): | ||||||||
For the Three Months Ended March 31, | ||||||||
2014 | 2013 | |||||||
Revenue from real estate operations | $ | 19 | $ | 10,120 | ||||
Property operating expenses | 20 | (3,678 | ) | |||||
Depreciation and amortization | — | (1,242 | ) | |||||
Impairment losses | (1 | ) | (1,857 | ) | ||||
General, administrative and leasing expenses | — | (1 | ) | |||||
Interest expense | — | (2,081 | ) | |||||
Loss on sales of real estate | (4 | ) | — | |||||
Loss on early extinguishment of debt | (23 | ) | — | |||||
Discontinued operations | $ | 11 | $ | 1,261 | ||||
Earnings_Per_Share_EPS_and_Ear1
Earnings Per Share ("EPS") and Earnings Per Unit ("EPU") (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Earnings Per Share [Line Items] | ' | ||||||||
Summary of calculation of numerator and denominator in basic and diluted earnings per share | ' | ||||||||
Summaries of the numerator and denominator for purposes of basic and diluted EPS calculations are set forth below (in thousands, except per share data): | |||||||||
For the Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Numerator: | |||||||||
Income from continuing operations | $ | 5,660 | $ | 11,662 | |||||
Gain on sales of real estate, net | — | 2,354 | |||||||
Preferred share dividends | (4,490 | ) | (6,106 | ) | |||||
Income from continuing operations attributable to noncontrolling interests | (932 | ) | (167 | ) | |||||
Income from continuing operations attributable to restricted shares | (121 | ) | (118 | ) | |||||
Numerator for basic and diluted EPS from continuing operations attributable to COPT common shareholders | $ | 117 | $ | 7,625 | |||||
Discontinued operations | 11 | 1,261 | |||||||
Discontinued operations attributable to noncontrolling interests | 2 | (90 | ) | ||||||
Numerator for basic and diluted EPS on net income attributable to COPT common shareholders | $ | 130 | $ | 8,796 | |||||
Denominator (all weighted averages): | |||||||||
Denominator for basic EPS (common shares) | 87,080 | 81,397 | |||||||
Dilutive effect of share-based compensation awards | 112 | 52 | |||||||
Denominator for diluted EPS (common shares) | 87,192 | 81,449 | |||||||
Basic EPS: | |||||||||
Income from continuing operations attributable to COPT common shareholders | $ | 0 | $ | 0.09 | |||||
Discontinued operations attributable to COPT common shareholders | 0 | 0.02 | |||||||
Net income attributable to COPT common shareholders | $ | 0 | $ | 0.11 | |||||
Diluted EPS: | |||||||||
Income from continuing operations attributable to COPT common shareholders | $ | 0 | $ | 0.09 | |||||
Discontinued operations attributable to COPT common shareholders | 0 | 0.02 | |||||||
Net income attributable to COPT common shareholders | $ | 0 | $ | 0.11 | |||||
Schedule of securities excluded from computation of diluted earnings per share | ' | ||||||||
Our diluted EPS computations do not include the effects of the following securities since the conversions of such securities would increase diluted EPS for the respective periods (in thousands): | |||||||||
Weighted Average Shares Excluded from Denominator | |||||||||
For the Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Conversion of common units | 3,958 | 3,893 | |||||||
Conversion of Series I Preferred Units | 176 | 176 | |||||||
Conversion of Series K Preferred Shares | 434 | 434 | |||||||
Corporate Office Properties, L.P. | ' | ||||||||
Earnings Per Share [Line Items] | ' | ||||||||
Summary of calculation of numerator and denominator in basic and diluted earnings per share | ' | ||||||||
Summaries of the numerator and denominator for purposes of basic and diluted EPU calculations are set forth below (in thousands, except per unit data): | |||||||||
For the Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Numerator: | |||||||||
Income from continuing operations | $ | 5,660 | $ | 11,662 | |||||
Gain on sales of real estate, net | — | 2,354 | |||||||
Preferred unit distributions | (4,655 | ) | (6,271 | ) | |||||
(Income) loss from continuing operations attributable to noncontrolling interests | (739 | ) | 369 | ||||||
Income from continuing operations attributable to restricted units | (121 | ) | (118 | ) | |||||
Numerator for basic and diluted EPU from continuing operations attributable to COPLP common unitholders | $ | 145 | $ | 7,996 | |||||
Discontinued operations | 11 | 1,261 | |||||||
Discontinued operations attributable to noncontrolling interests | 2 | (33 | ) | ||||||
Numerator for basic and diluted EPU on net income attributable to COPLP common unitholders | $ | 158 | $ | 9,224 | |||||
Denominator (all weighted averages): | |||||||||
Denominator for basic EPU (common units) | 91,038 | 85,290 | |||||||
Dilutive effect of share-based compensation awards | 112 | 52 | |||||||
Denominator for basic and diluted EPU (common units) | 91,150 | 85,342 | |||||||
Basic EPU: | |||||||||
Income from continuing operations attributable to COPLP common unitholders | $ | 0 | $ | 0.09 | |||||
Discontinued operations attributable to COPLP common unitholders | 0 | 0.02 | |||||||
Net income attributable to COPLP common unitholders | $ | 0 | $ | 0.11 | |||||
Diluted EPU: | |||||||||
Income from continuing operations attributable to COPLP common unitholders | $ | 0 | $ | 0.09 | |||||
Discontinued operations attributable to COPLP common unitholders | 0 | 0.02 | |||||||
Net income attributable to COPLP common unitholders | $ | 0 | $ | 0.11 | |||||
Schedule of securities excluded from computation of diluted earnings per share | ' | ||||||||
Our diluted EPU computations do not include the effects of the following securities since the conversions of such securities would increase diluted EPU for the respective periods (in thousands): | |||||||||
Weighted Average Units Excluded from Denominator | |||||||||
For the Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Conversion of Series I preferred units | 176 | 176 | |||||||
Conversion of Series K preferred units | 434 | 434 | |||||||
Organization_Details
Organization (Details) | 3 Months Ended |
Mar. 31, 2014 | |
sqft | |
acre | |
Operating office properties | ' |
Investments in real estate | ' |
Number of real estate properties | 183 |
Square footage of real estate properties (in square feet) | 17,500,000 |
Office properties under, or contractually committed for, construction or approved for redevelopment | ' |
Investments in real estate | ' |
Number of real estate properties | 12 |
Square footage of real estate properties (in square feet) | 1,600,000 |
Office properties under construction or redevelopment which are partially operational | ' |
Investments in real estate | ' |
Number of real estate properties | 2 |
Land held or under pre-construction | ' |
Investments in real estate | ' |
Area of land held or under pre-construction (in acres) | 1,716 |
Area of land parcels controlled but not owned (in acres) | 56 |
Developable square footage of real estate properties (in square feet) | 19,700,000 |
Partially operational, wholesale data center | ' |
Investments in real estate | ' |
The expected stabilization critical load after completion of development (in megawatts) | 18 |
Organization_Details_2
Organization (Details 2) (Corporate Office Properties, L.P.) | 3 Months Ended |
Mar. 31, 2014 | |
Trustee | |
Common Units | ' |
Forms of ownership in Operating Partnership and ownership percentage by the entity | ' |
Percentage ownership in operating partnership | 95.70% |
Number of trustees controlling additional common units | 3 |
Additional percentage of common units controlled by trustees (as a percent) | 3.40% |
Preferred Units | ' |
Forms of ownership in Operating Partnership and ownership percentage by the entity | ' |
Percentage ownership in operating partnership | 96.40% |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | |
In Thousands, unless otherwise specified | |||||
Liabilities: | ' | ' | ' | ' | |
Interest rate derivatives | $3,196 | $3,309 | ' | ' | |
Redeemable noncontrolling interest | 17,654 | 17,758 | 10,356 | 10,298 | |
Corporate Office Properties, L.P. | ' | ' | ' | ' | |
Liabilities: | ' | ' | ' | ' | |
Interest rate derivatives | 3,196 | 3,309 | ' | ' | |
Fair value measurement on a recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ' | ' | ' | ' | |
Assets: | ' | ' | ' | ' | |
Assets | 7,565 | ' | ' | ' | |
Fair value measurement on a recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Mutual funds | ' | ' | ' | ' | |
Assets: | ' | ' | ' | ' | |
Marketable securities in deferred compensation plan | 7,249 | [1] | ' | ' | ' |
Fair value measurement on a recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Common Shares | ' | ' | ' | ' | |
Assets: | ' | ' | ' | ' | |
Marketable securities in deferred compensation plan | 115 | [1] | ' | ' | ' |
Fair value measurement on a recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Other | ' | ' | ' | ' | |
Assets: | ' | ' | ' | ' | |
Marketable securities in deferred compensation plan | 201 | [1] | ' | ' | ' |
Fair value measurement on a recurring basis | Significant Other Observable Inputs (Level 2) | ' | ' | ' | ' | |
Assets: | ' | ' | ' | ' | |
Interest rate derivatives | 5,038 | [2] | ' | ' | ' |
Warrants to purchase common stock | 537 | [2] | ' | ' | ' |
Assets | 5,575 | ' | ' | ' | |
Liabilities: | ' | ' | ' | ' | |
Deferred compensation plan liability | 7,565 | ' | ' | ' | |
Interest rate derivatives | 3,196 | ' | ' | ' | |
Liabilities | 10,761 | ' | ' | ' | |
Fair value measurement on a recurring basis | Significant Unobservable Inputs (Level 3) | ' | ' | ' | ' | |
Liabilities: | ' | ' | ' | ' | |
Redeemable noncontrolling interest | 17,654 | ' | ' | ' | |
Fair value measurement on a recurring basis | Total Estimated Fair Value | ' | ' | ' | ' | |
Assets: | ' | ' | ' | ' | |
Interest rate derivatives | 5,038 | [2] | ' | ' | ' |
Warrants to purchase common stock | 537 | [2] | ' | ' | ' |
Assets | 13,140 | ' | ' | ' | |
Liabilities: | ' | ' | ' | ' | |
Deferred compensation plan liability | 7,565 | [3] | ' | ' | ' |
Interest rate derivatives | 3,196 | ' | ' | ' | |
Liabilities | 10,761 | ' | ' | ' | |
Redeemable noncontrolling interest | 17,654 | ' | ' | ' | |
Fair value measurement on a recurring basis | Total Estimated Fair Value | Mutual funds | ' | ' | ' | ' | |
Assets: | ' | ' | ' | ' | |
Marketable securities in deferred compensation plan | 7,249 | [1] | ' | ' | ' |
Fair value measurement on a recurring basis | Total Estimated Fair Value | Common Shares | ' | ' | ' | ' | |
Assets: | ' | ' | ' | ' | |
Marketable securities in deferred compensation plan | 115 | [1] | ' | ' | ' |
Fair value measurement on a recurring basis | Total Estimated Fair Value | Other | ' | ' | ' | ' | |
Assets: | ' | ' | ' | ' | |
Marketable securities in deferred compensation plan | 201 | [1] | ' | ' | ' |
Fair value measurement on a recurring basis | Corporate Office Properties, L.P. | Significant Other Observable Inputs (Level 2) | ' | ' | ' | ' | |
Assets: | ' | ' | ' | ' | |
Interest rate derivatives | 5,038 | [4] | ' | ' | ' |
Warrants to purchase common stock | 537 | [4] | ' | ' | ' |
Assets | 5,575 | ' | ' | ' | |
Liabilities: | ' | ' | ' | ' | |
Interest rate derivatives | 3,196 | ' | ' | ' | |
Fair value measurement on a recurring basis | Corporate Office Properties, L.P. | Total Estimated Fair Value | ' | ' | ' | ' | |
Assets: | ' | ' | ' | ' | |
Interest rate derivatives | 5,038 | [4] | ' | ' | ' |
Warrants to purchase common stock | 537 | [4] | ' | ' | ' |
Assets | 5,575 | ' | ' | ' | |
Liabilities: | ' | ' | ' | ' | |
Interest rate derivatives | 3,196 | ' | ' | ' | |
Redeemable noncontrolling interest | $17,654 | ' | ' | ' | |
[1] | Included in the line entitled “restricted cash and marketable securities†on COPT’s consolidated balance sheet. | ||||
[2] | Included in the line entitled “prepaid expenses and other assets†on COPT’s consolidated balance sheet. | ||||
[3] | Included in the line entitled “other liabilities†on COPT’s consolidated balance sheet. | ||||
[4] | Included in the line entitled “prepaid expenses and other assets†on COPLP’s consolidated balance sheet. |
Fair_Value_Measurements_Detail1
Fair Value Measurements (Details 2) (Fair value measurement on a nonrecurring basis, Properties,net, USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2013 |
Assets and liabilities measured at fair value on a non-recurring basis | ' |
Impairment losses (recoveries) | $1,857 |
Significant Unobservable Inputs (Level 3) | ' |
Assets and liabilities measured at fair value on a non-recurring basis | ' |
Assets | 7,250 |
Total Estimated Fair Value | ' |
Assets and liabilities measured at fair value on a non-recurring basis | ' |
Assets | $7,250 |
Fair_Value_Measurements_Detail2
Fair Value Measurements (Details 3) (Significant Unobservable Inputs (Level 3), USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2013 |
Fair value measurement on a recurring basis | Properties,net | Properties,net | |
Redeemable Non-Controlling Interest | Fair value measurement on a nonrecurring basis | Fair value measurement on a nonrecurring basis | |
Bids for property indicative of value | |||
Quantitative information for significant unobservable inputs used for Level 3 fair value measurements | ' | ' | ' |
Fair value inputs, discount rate | 15.50% | ' | ' |
Fair value on measurement date | ' | $7,250 | $7,250 |
Properties_net_Details
Properties, net (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 |
Greater Philadelphia | Operating properties, net | Operating properties, net | Operating properties, net | Operating properties, net | Operating properties, net | Operating properties, net | |||
Land | Land | Buildings and improvements | Buildings and improvements | ||||||
Properties | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross | ' | ' | ' | ' | ' | $436,381,000 | $430,472,000 | $2,927,800,000 | $2,869,870,000 |
Less: accumulated depreciation | ' | ' | ' | -635,178,000 | -597,649,000 | ' | ' | ' | ' |
Operating properties, net | 2,729,003,000 | 2,702,693,000 | ' | ' | ' | ' | ' | ' | ' |
Depreciation Expense on Reclassified Assets | ' | ' | $12,900,000 | ' | ' | ' | ' | ' | ' |
Properties_net_Details_2
Properties, net (Details 2) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Properties | ' | ' |
Projects in development or held for future development | $495,625 | $511,608 |
Projects in development or held for future development | Land in development or held for future development | ' | ' |
Properties | ' | ' |
Projects in development or held for future development | 238,904 | 245,676 |
Projects in development or held for future development | Construction in progress, excluding land | ' | ' |
Properties | ' | ' |
Projects in development or held for future development | $256,721 | $265,932 |
Properties_net_Details_3
Properties, net (Details 3) | 3 Months Ended |
Mar. 31, 2014 | |
Property | |
sqft | |
Newly constructed properties placed in service | ' |
Construction and Redevelopment Activities | ' |
Square Feet of Properties Placed in Service | 355,000 |
Number of Real Estate Properties Placed In Service | 2 |
Properties under construction or contractually committed for construction | ' |
Construction and Redevelopment Activities | ' |
Number of real estate properties | 8 |
Square footage of real estate properties (in square feet) | 1,200,000 |
Properties under construction or contractually committed for construction | Baltimore and Washington Corridor | ' |
Construction and Redevelopment Activities | ' |
Number of real estate properties | 4 |
Properties under construction or contractually committed for construction | Northern Virginia | ' |
Construction and Redevelopment Activities | ' |
Number of real estate properties | 3 |
Properties under construction or contractually committed for construction | San Antonio | ' |
Construction and Redevelopment Activities | ' |
Number of real estate properties | 1 |
Properties under or approved for redevelopment | ' |
Construction and Redevelopment Activities | ' |
Number of real estate properties | 4 |
Square footage of real estate properties (in square feet) | 403,000 |
Properties under or approved for redevelopment | Baltimore and Washington Corridor | ' |
Construction and Redevelopment Activities | ' |
Number of real estate properties | 1 |
Properties under or approved for redevelopment | Greater Philadelphia | ' |
Construction and Redevelopment Activities | ' |
Number of real estate properties | 2 |
Properties under or approved for redevelopment | St. Mary's and King George Counties | ' |
Construction and Redevelopment Activities | ' |
Number of real estate properties | 1 |
Real_Estate_Joint_Ventures_Det
Real Estate Joint Ventures (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | |
buillding | ||
Consolidated real estate joint ventures | ' | |
Investments in consolidated real estate joint ventures | ' | |
Total Assets | $202,395 | [1] |
Pledged Assets | 116,718 | [1] |
Total Liabilities | 76,808 | [1] |
LW Redstone Company, LLC | ' | |
Investments in consolidated real estate joint ventures | ' | |
Ownership (as a percent) | 85.00% | |
Total Assets | 135,231 | [1],[2] |
Pledged Assets | 68,360 | [1],[2] |
Total Liabilities | 36,272 | [1],[2] |
Buildings Operated by Joint Ventures Number | 4 | [2] |
M Square Associates, LLC | ' | |
Investments in consolidated real estate joint ventures | ' | |
Ownership (as a percent) | 50.00% | |
Total Assets | 60,728 | [1],[3] |
Pledged Assets | 48,358 | [1],[3] |
Total Liabilities | 40,536 | [1],[3] |
Buildings Operated by Joint Ventures Number | 2 | [3] |
COPT-FD Indian Head, LLC | ' | |
Investments in consolidated real estate joint ventures | ' | |
Ownership (as a percent) | 75.00% | |
Total Assets | $6,436 | [1],[4] |
[1] | Excludes amounts eliminated in consolidation. | |
[2] | This joint venture’s property is in Huntsville, Alabama. | |
[3] | This joint venture’s properties are in College Park, Maryland (in the Baltimore/Washington Corridor). | |
[4] | This joint venture’s property is in Charles County, Maryland. In 2012, the joint venture exercised its option under a development agreement to require Charles County to repurchase the land parcel at its original acquisition cost. Under the terms of the agreement with Charles County, the repurchase is expected to occur by August 2014. |
Mortgage_and_Other_Investing_R2
Mortgage and Other Investing Receivables (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Mortgage and other investing receivables | $55,231 | $53,663 |
Notes Receivable from City of Huntsville | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Mortgage and other investing receivables | 45,381 | 44,055 |
Mortgage Receivable | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Mortgage and other investing receivables | $9,850 | $9,608 |
Number of mortgage loans receivable | 1 | ' |
Prepaid_Expenses_and_Other_Ass2
Prepaid Expenses and Other Assets (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | ||
Prepaid Expense and Other Assets [Abstract] | ' | ' | ||
Prepaid expenses | $13,813,000 | $19,308,000 | ||
Lease incentives | 11,900,000 | 8,435,000 | ||
Furniture, fixtures and equipment, net | 7,068,000 | 6,556,000 | ||
Interest rate derivatives | 5,038,000 | 6,594,000 | ||
Construction contract costs incurred in excess of billings | 4,990,000 | 2,462,000 | ||
Deferred tax asset, net (1) | 4,241,000 | [1] | 4,305,000 | [1] |
Other equity method investments | 2,266,000 | 2,258,000 | ||
Other assets | 4,616,000 | 4,268,000 | ||
Prepaid expenses and other assets | 53,932,000 | 54,186,000 | ||
Long-term Operating Notes Receivable | ' | ' | ||
Mortgage and Other Investing Receivables [Line Items] | ' | ' | ||
Operating Notes Receivable Long-term | 1,700,000 | 1,700,000 | ||
Allowance for Notes, Loans and Financing Receivable, Noncurrent | 124,000 | 87,000 | ||
Taxable REIT Subsidiary | ' | ' | ||
Mortgage and Other Investing Receivables [Line Items] | ' | ' | ||
Deferred Tax Assets, Valuation Allowance | $2,100,000 | $2,100,000 | ||
[1] | Includes a valuation allowance of $2.1 million. |
Debt_Details
Debt (Details) (USD $) | 3 Months Ended | 3 Months Ended | 3 Months Ended | 3 Months Ended | 3 Months Ended | 3 Months Ended | 3 Months Ended | |||||||||||||||||||||||||||||||||||||||||
Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | Apr. 01, 2014 | Apr. 01, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | |||||||||||||||||||
Mortgage and Other Secured Loans: | Mortgage and Other Secured Loans: | Fixed rate mortgage loans | Fixed rate mortgage loans | Variable rate secured loans | Variable rate secured loans | Revolving Credit Facility | Revolving Credit Facility | Term Loan Facilities | Term Loan Facilities | Unsecured notes payable | Unsecured notes payable | 4.25% Exchangeable Senior Notes | 4.25% Exchangeable Senior Notes | 4.25% Exchangeable Senior Notes | Debt in default of payment terms | Debt in default of payment terms | Construction loans | Unsecured senior notes | Unsecured senior notes | Unsecured senior notes | Unsecured senior notes | Revolving Credit Facility | Minimum | Minimum | Maximum | Maximum | ||||||||||||||||||||||
Wholly owned subsidiary | Wholly owned subsidiary | Fixed rate mortgage loans | 3.60% Senior Notes | 3.60% Senior Notes | 5.250% Senior Notes | 5.250% Senior Notes | Revolving Credit Facility | Term Loan Facilities | Revolving Credit Facility | Term Loan Facilities | ||||||||||||||||||||||||||||||||||||||
Subsequent Event | Subsequent Event | |||||||||||||||||||||||||||||||||||||||||||||||
Northern Virginia | ||||||||||||||||||||||||||||||||||||||||||||||||
Property | ||||||||||||||||||||||||||||||||||||||||||||||||
Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Maximum Availability | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $800,000,000 | [1] | ' | ' | ' | ' | |||||||||||||||||
Carrying Value | 1,931,831,000 | ' | 1,927,703,000 | 716,751,000 | 712,751,000 | 679,260,000 | [2] | 675,060,000 | [2] | 37,491,000 | 37,691,000 | 0 | [1] | 0 | [1] | 620,000,000 | 620,000,000 | 1,677,000 | 1,700,000 | 565,000 | [3] | ' | 563,000 | [3] | 150,000,000 | ' | 19,800,000 | 347,306,000 | [4] | 347,244,000 | [4] | 245,532,000 | [5] | 245,445,000 | [5] | ' | ' | ' | ' | ' | ||||||||
Stated Interest Rates, low end of range (as a percent) | ' | ' | ' | ' | ' | 3.96% | [6] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||||||||||||||||
Stated Interest Rates, high end of range (as a percent) | ' | ' | ' | ' | ' | 7.87% | [6] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||||||||||||||||
Description of variable rate basis | ' | ' | ' | ' | ' | ' | ' | 'LIBOR | [7] | ' | 'LIBOR | [1] | ' | 'LIBOR | [8] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |||||||||||||||
Variable rate, spread (as a percent) | ' | ' | ' | ' | ' | ' | ' | 2.25% | [7] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.98% | [1] | 1.10% | [8] | 1.75% | [1] | 2.60% | [8] | |||||||||||||
Stated interest rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.00% | [9] | ' | 4.25% | ' | ' | 5.65% | ' | ' | 3.60% | ' | 5.25% | ' | ' | ' | ' | ' | ' | |||||||||||||||||
Unamortized premium included in carrying value | ' | ' | ' | ' | ' | 62,000 | 69,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Debt Instrument, Maximum Borrowing Capacity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 26,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Weighted average interest rate (as a percent) | ' | ' | ' | ' | ' | 6.12% | ' | ' | ' | ' | ' | 1.78% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Interest rate on debt (as a percent) | ' | ' | ' | ' | ' | ' | ' | 2.41% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Additional borrowing capacity available provided there is no default under the agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 180,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Debt instrument, face amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 350,000,000 | ' | 250,000,000 | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Unamortized discount included in carrying value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 734,000 | 761,000 | 10,000 | ' | 12,000 | ' | ' | ' | 2,700,000 | 2,800,000 | 4,500,000 | 4,600,000 | ' | ' | ' | ' | ' | ||||||||||||||||||
Effective interest rate, including amortization of issuance costs (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.05% | ' | ' | ' | ' | ' | 3.70% | ' | 5.49% | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Exchange rate per $1000 principal amount (in common shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20.8513 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Convertible debt principal amount, basis for exchange | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Exchange price per common share based on exchange rate (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $47.96 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Principal amount of debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 575,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Interest expense at stated interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,000 | 2,304,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Interest expense associated with amortization of discount | 171,000 | 710,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,000 | 864,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Total interest expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,000 | 3,168,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Number of properties pledged as collateral on loan in default | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
Capitalized interest costs | $1,600,000 | $2,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||
[1] | No borrowings were outstanding on this facility during the three months ended March 31, 2014. | |||||||||||||||||||||||||||||||||||||||||||||||
[2] | Several of the fixed rate mortgages carry interest rates that were above or below market rates upon assumption and therefore were recorded at their fair value based on applicable effective interest rates. The carrying values of these loans reflect net unamortized premiums totaling $62,000 as of March 31, 2014 and $69,000 as of December 31, 2013. | |||||||||||||||||||||||||||||||||||||||||||||||
[3] | As described further in our 2013 Annual Report on Form 10-K, these notes have an exchange settlement feature that provides that the notes may, under certain circumstances, be exchangeable for cash and, at COPLP’s discretion, COPT common shares at an exchange rate (subject to adjustment) of 20.8513 shares per one thousand dollar principal amount of the notes (exchange rate is as of March 31, 2014 and is equivalent to an exchange price of $47.96 per common share). The carrying value of these notes included a principal amount of $575,000 and an unamortized discount totaling $10,000 as of March 31, 2014 and $12,000 as of December 31, 2013. The effective interest rate under the notes, including amortization of the issuance costs, was 6.05%. Because the closing price of our common shares as of March 31, 2014 and December 31, 2013 was less than the exchange price per common share applicable to these notes, the if-converted value of the notes did not exceed the principal amount. The table below sets forth interest expense recognized on these notes before deductions for amounts capitalized (in thousands): For the Three Months Ended March 31, 2014 2013Interest expense at stated interest rate $6 $2,304Interest expense associated with amortization of discount 3 864Total $9 $3,168 | |||||||||||||||||||||||||||||||||||||||||||||||
[4] | The carrying value of these notes included a principal amount of $350.0 million and an unamortized discount totaling $2.7 million as of March 31, 2014 and $2.8 million as of December 31, 2013. The effective interest rate under the notes, including amortization of the issuance costs, was 3.70%. | |||||||||||||||||||||||||||||||||||||||||||||||
[5] | The carrying value of these notes included a principal amount of $250.0 million and an unamortized discount totaling $4.5 million as of March 31, 2014 and $4.6 million as of December 31, 2013. The effective interest rate under the notes, including amortization of the issuance costs, was 5.49%. | |||||||||||||||||||||||||||||||||||||||||||||||
[6] | The weighted average interest rate on these loans was 6.12% as of March 31, 2014. | |||||||||||||||||||||||||||||||||||||||||||||||
[7] | The interest rate on the loan outstanding was 2.41% as of March 31, 2014. | |||||||||||||||||||||||||||||||||||||||||||||||
[8] | The weighted average interest rate on these loans was 1.78% as of March 31, 2014. | |||||||||||||||||||||||||||||||||||||||||||||||
[9] | These notes carry interest rates that were below market rates upon assumption and therefore were recorded at their fair value based on applicable effective interest rates. The carrying value of these notes reflects an unamortized discount totaling $734,000 as of March 31, 2014 and $761,000 as of December 31, 2013. |
Debt_Details_2
Debt (Details 2) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Carrying amount and estimated fair value of debt | ' | ' | ||
Carrying Value | $1,931,831 | $1,927,703 | ||
4.25% Exchangeable Senior Notes | ' | ' | ||
Carrying amount and estimated fair value of debt | ' | ' | ||
Carrying Value | 565 | [1] | 563 | [1] |
Carrying Amount | ' | ' | ||
Carrying amount and estimated fair value of debt | ' | ' | ||
Variable-rate debt | 657,491 | 657,691 | ||
Carrying Value | 1,931,831 | 1,927,703 | ||
Carrying Amount | Unsecured senior notes | ' | ' | ||
Carrying amount and estimated fair value of debt | ' | ' | ||
Fixed-rate debt | 592,838 | 592,689 | ||
Carrying Amount | 4.25% Exchangeable Senior Notes | ' | ' | ||
Carrying amount and estimated fair value of debt | ' | ' | ||
Fixed-rate debt | 565 | 563 | ||
Carrying Amount | Other fixed-rate debt | ' | ' | ||
Carrying amount and estimated fair value of debt | ' | ' | ||
Fixed-rate debt | 680,937 | 676,760 | ||
Total Estimated Fair Value | ' | ' | ||
Carrying amount and estimated fair value of debt | ' | ' | ||
Variable-rate debt | 657,420 | 657,527 | ||
Carrying Value | 1,911,122 | 1,884,473 | ||
Total Estimated Fair Value | Unsecured senior notes | ' | ' | ||
Carrying amount and estimated fair value of debt | ' | ' | ||
Fixed-rate debt | 584,178 | 575,374 | ||
Total Estimated Fair Value | 4.25% Exchangeable Senior Notes | ' | ' | ||
Carrying amount and estimated fair value of debt | ' | ' | ||
Fixed-rate debt | 575 | 575 | ||
Total Estimated Fair Value | Other fixed-rate debt | ' | ' | ||
Carrying amount and estimated fair value of debt | ' | ' | ||
Fixed-rate debt | $668,949 | $650,997 | ||
[1] | As described further in our 2013 Annual Report on Form 10-K, these notes have an exchange settlement feature that provides that the notes may, under certain circumstances, be exchangeable for cash and, at COPLP’s discretion, COPT common shares at an exchange rate (subject to adjustment) of 20.8513 shares per one thousand dollar principal amount of the notes (exchange rate is as of March 31, 2014 and is equivalent to an exchange price of $47.96 per common share). The carrying value of these notes included a principal amount of $575,000 and an unamortized discount totaling $10,000 as of March 31, 2014 and $12,000 as of December 31, 2013. The effective interest rate under the notes, including amortization of the issuance costs, was 6.05%. Because the closing price of our common shares as of March 31, 2014 and December 31, 2013 was less than the exchange price per common share applicable to these notes, the if-converted value of the notes did not exceed the principal amount. The table below sets forth interest expense recognized on these notes before deductions for amounts capitalized (in thousands): For the Three Months Ended March 31, 2014 2013Interest expense at stated interest rate $6 $2,304Interest expense associated with amortization of discount 3 864Total $9 $3,168 |
Interest_Rate_Derivatives_Deta
Interest Rate Derivatives (Details) (USD $) | 3 Months Ended | |||
Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | ||
Fair values of interest rate swap derivatives | ' | ' | ' | |
Fair value of interest rate swaps | $1,842,000 | ' | $3,285,000 | |
Fair value of interest rate derivatives and balance sheet classification | ' | ' | ' | |
Interest rate derivatives | 5,038,000 | ' | 6,594,000 | |
Effect of interest rate derivatives on consolidated statements of operations and comprehensive income | ' | ' | ' | |
Amount of (losses) gains recognized in accumulated other comprehensive income (loss) (“AOCIâ€) (effective portion) | -2,123,000 | 462,000 | ' | |
Amount of losses reclassified from AOCI into interest expense (effective portion) | 695,000 | 658,000 | ' | |
Interest rate swaps | ' | ' | ' | |
Fair value of interest rate derivatives and balance sheet classification | ' | ' | ' | |
Interest rate derivatives | 5,038,000 | ' | 6,594,000 | |
Fair value of Interest rate swaps classified as interest rate derivatives | -3,196,000 | ' | -3,309,000 | |
Effect of interest rate derivatives on consolidated statements of operations and comprehensive income | ' | ' | ' | |
Approximate loss amount to be reclassified from AOCI to interest expense over the next 12 months | -3,000,000 | ' | ' | |
Interest rate derivatives in liability position, fair value | 3,200,000 | ' | ' | |
Termination value to settle obligations under interest rate derivative agreements | 3,400,000 | ' | ' | |
Designated | Interest rate swap, effective date January 3, 2012, swap one | ' | ' | ' | |
Fair values of interest rate swap derivatives | ' | ' | ' | |
Notional Amount | 100,000,000 | ' | ' | |
Fixed rate (as a percent) | 0.61% | ' | ' | |
Floating rate index | 'One-Month LIBOR | ' | ' | |
Fair value of interest rate swaps | -195,000 | ' | -279,000 | |
Designated | Interest rate swap, effective date January 3, 2012, swap two | ' | ' | ' | |
Fair values of interest rate swap derivatives | ' | ' | ' | |
Notional Amount | 100,000,000 | ' | ' | |
Fixed rate (as a percent) | 0.61% | ' | ' | |
Floating rate index | 'One-Month LIBOR | ' | ' | |
Fair value of interest rate swaps | -194,000 | ' | -277,000 | |
Designated | Interest rate swap, effective date January 3, 2012, swap three | ' | ' | ' | |
Fair values of interest rate swap derivatives | ' | ' | ' | |
Notional Amount | 100,000,000 | ' | ' | |
Fixed rate (as a percent) | 0.83% | ' | ' | |
Floating rate index | 'One-Month LIBOR | ' | ' | |
Fair value of interest rate swaps | -807,000 | ' | -861,000 | |
Designated | Interest rate swap, effective date January 3, 2012, swap four | ' | ' | ' | |
Fair values of interest rate swap derivatives | ' | ' | ' | |
Notional Amount | 100,000,000 | ' | ' | |
Fixed rate (as a percent) | 0.83% | ' | ' | |
Floating rate index | 'One-Month LIBOR | ' | ' | |
Fair value of interest rate swaps | -807,000 | ' | -861,000 | |
Designated | Interest rate swap, effective date November 2, 2010 | ' | ' | ' | |
Fair values of interest rate swap derivatives | ' | ' | ' | |
Notional Amount | 37,491,000 | [1] | ' | ' |
Fixed rate (as a percent) | 3.83% | ' | ' | |
Floating rate index | 'One-Month LIBOR + 2.25% | ' | ' | |
Derivative, Basis Spread on Variable Rate | 2.25% | ' | ' | |
Fair value of interest rate swaps | -742,000 | ' | -832,000 | |
Notional amount of interest rate derivatives after scheduled amortization | 36,200,000 | ' | ' | |
Designated | Interest rate swap, effective date September 2, 2014, swap one | ' | ' | ' | |
Fair values of interest rate swap derivatives | ' | ' | ' | |
Notional Amount | 100,000,000 | ' | ' | |
Fixed rate (as a percent) | 0.81% | ' | ' | |
Floating rate index | 'One-Month LIBOR | ' | ' | |
Fair value of interest rate swaps | -220,000 | ' | -94,000 | |
Designated | Interest rate swap, effective date September 2, 2014, swap two | ' | ' | ' | |
Fair values of interest rate swap derivatives | ' | ' | ' | |
Notional Amount | 100,000,000 | ' | ' | |
Fixed rate (as a percent) | 0.81% | ' | ' | |
Floating rate index | 'One-Month LIBOR | ' | ' | |
Fair value of interest rate swaps | -231,000 | ' | -105,000 | |
Designated | Interest rate swap, effective date September 1, 2015, swap one | ' | ' | ' | |
Fair values of interest rate swap derivatives | ' | ' | ' | |
Notional Amount | 100,000,000 | ' | ' | |
Fixed rate (as a percent) | 1.67% | ' | ' | |
Floating rate index | 'One-Month LIBOR | ' | ' | |
Fair value of interest rate swaps | 2,604,000 | ' | 3,377,000 | |
Designated | Interest rate swap, effective date September 1, 2015, swap two | ' | ' | ' | |
Fair values of interest rate swap derivatives | ' | ' | ' | |
Notional Amount | 100,000,000 | ' | ' | |
Fixed rate (as a percent) | 1.73% | ' | ' | |
Floating rate index | 'One-Month LIBOR | ' | ' | |
Fair value of interest rate swaps | $2,434,000 | ' | $3,217,000 | |
[1] | The notional amount of this instrument is scheduled to amortize to $36.2 million. |
Redeemable_Noncontrolling_Inte2
Redeemable Noncontrolling Interests (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Redeemable Noncontrolling Interest [Roll Forward] | ' | ' |
Beginning balance | $17,758 | $10,298 |
Distribution to noncontrolling interest | -68 | 0 |
Net income (loss) attributable to noncontrolling interest | 504 | -790 |
Adjustment to arrive at fair value of interest | -540 | 848 |
Ending balance | $17,654 | $10,356 |
Equity_Details
Equity (Details) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Equity [Abstract] | ' | ' |
Number of operating partnerships units converted into common shares (in units) | 48,498 | 248,644 |
Number of common shares for each converted common unit (in shares) | 1 | ' |
Information_by_Business_Segmen2
Information by Business Segment (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
segment | |||
Segment Reporting [Abstract] | ' | ' | ' |
Number of primary office property segments | 10 | ' | ' |
Segment financial information for real estate operations | ' | ' | ' |
Revenues from real estate operations | $124,896 | $122,077 | ' |
Property operating expenses | 49,752 | 44,066 | ' |
NOI from real estate operations | 75,144 | 78,011 | ' |
Segment assets | 3,605,897 | 3,685,099 | 3,629,952 |
Operating Segment Total | ' | ' | ' |
Segment financial information for real estate operations | ' | ' | ' |
Revenues from real estate operations | 124,896 | 122,077 | ' |
Property operating expenses | 49,752 | 44,066 | ' |
NOI from real estate operations | 75,144 | 78,011 | ' |
Additions to long-lived assets | 13,729 | 5,854 | ' |
Transfers from non-operating properties | 56,940 | 131,596 | ' |
Segment assets | 2,932,749 | 3,055,876 | ' |
Baltimore and Washington Corridor | ' | ' | ' |
Segment financial information for real estate operations | ' | ' | ' |
Revenues from real estate operations | 61,113 | 58,660 | ' |
Property operating expenses | 23,597 | 20,053 | ' |
NOI from real estate operations | 37,516 | 38,607 | ' |
Additions to long-lived assets | 5,741 | 2,760 | ' |
Transfers from non-operating properties | -169 | 22,997 | ' |
Segment assets | 1,237,796 | 1,279,794 | ' |
Northern Virginia | ' | ' | ' |
Segment financial information for real estate operations | ' | ' | ' |
Revenues from real estate operations | 24,968 | 22,942 | ' |
Property operating expenses | 8,973 | 7,817 | ' |
NOI from real estate operations | 15,995 | 15,125 | ' |
Additions to long-lived assets | 3,495 | 1,544 | ' |
Transfers from non-operating properties | 26,588 | 9,839 | ' |
Segment assets | 636,895 | 574,970 | ' |
San Antonio | ' | ' | ' |
Segment financial information for real estate operations | ' | ' | ' |
Revenues from real estate operations | 8,479 | 7,757 | ' |
Property operating expenses | 4,474 | 3,888 | ' |
NOI from real estate operations | 4,005 | 3,869 | ' |
Additions to long-lived assets | -6 | 10 | ' |
Transfers from non-operating properties | 0 | 0 | ' |
Segment assets | 117,812 | 119,145 | ' |
Huntsville | ' | ' | ' |
Segment financial information for real estate operations | ' | ' | ' |
Revenues from real estate operations | 2,555 | 740 | ' |
Property operating expenses | 653 | 182 | ' |
NOI from real estate operations | 1,902 | 558 | ' |
Additions to long-lived assets | 2,507 | 0 | ' |
Transfers from non-operating properties | 20,102 | 24,240 | ' |
Segment assets | 99,378 | 52,361 | ' |
Washington, DC - Capitol Riverfront | ' | ' | ' |
Segment financial information for real estate operations | ' | ' | ' |
Revenues from real estate operations | 3,634 | 4,244 | ' |
Property operating expenses | 1,765 | 1,949 | ' |
NOI from real estate operations | 1,869 | 2,295 | ' |
Additions to long-lived assets | 63 | 157 | ' |
Transfers from non-operating properties | 0 | 0 | ' |
Segment assets | 97,843 | 102,928 | ' |
St. Mary's and King George Counties | ' | ' | ' |
Segment financial information for real estate operations | ' | ' | ' |
Revenues from real estate operations | 4,316 | 3,992 | ' |
Property operating expenses | 1,504 | 1,193 | ' |
NOI from real estate operations | 2,812 | 2,799 | ' |
Additions to long-lived assets | 839 | 275 | ' |
Transfers from non-operating properties | 0 | 6 | ' |
Segment assets | 95,645 | 97,346 | ' |
Greater Baltimore | ' | ' | ' |
Segment financial information for real estate operations | ' | ' | ' |
Revenues from real estate operations | 11,496 | 10,719 | ' |
Property operating expenses | 5,476 | 4,168 | ' |
NOI from real estate operations | 6,020 | 6,551 | ' |
Additions to long-lived assets | 1,012 | 702 | ' |
Transfers from non-operating properties | 7,154 | 113 | ' |
Segment assets | 307,699 | 317,953 | ' |
Greater Philadelphia | ' | ' | ' |
Segment financial information for real estate operations | ' | ' | ' |
Revenues from real estate operations | 3,340 | 2,487 | ' |
Property operating expenses | 1,300 | 838 | ' |
NOI from real estate operations | 2,040 | 1,649 | ' |
Additions to long-lived assets | 11 | 0 | ' |
Transfers from non-operating properties | 3,176 | 7,050 | ' |
Segment assets | 94,428 | 85,017 | ' |
Colorado Springs | ' | ' | ' |
Segment financial information for real estate operations | ' | ' | ' |
Revenues from real estate operations | 18 | 6,682 | ' |
Property operating expenses | -9 | 2,437 | ' |
NOI from real estate operations | 27 | 4,245 | ' |
Additions to long-lived assets | 0 | 315 | ' |
Transfers from non-operating properties | 11 | 1,783 | ' |
Segment assets | 7 | 177,728 | ' |
Other | ' | ' | ' |
Segment financial information for real estate operations | ' | ' | ' |
Revenues from real estate operations | 2,576 | 2,501 | ' |
Property operating expenses | 331 | 225 | ' |
NOI from real estate operations | 2,245 | 2,276 | ' |
Additions to long-lived assets | 55 | 91 | ' |
Transfers from non-operating properties | 0 | 0 | ' |
Segment assets | 79,535 | 81,714 | ' |
Wholesale Data Center | ' | ' | ' |
Segment financial information for real estate operations | ' | ' | ' |
Revenues from real estate operations | 2,401 | 1,353 | ' |
Property operating expenses | 1,688 | 1,316 | ' |
NOI from real estate operations | 713 | 37 | ' |
Additions to long-lived assets | 12 | 0 | ' |
Transfers from non-operating properties | 78 | 65,568 | ' |
Segment assets | $165,711 | $166,920 | ' |
Information_by_Business_Segmen3
Information by Business Segment (Details 2) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Reconciliation of segment revenues to total revenues | ' | ' |
Segment revenues from real estate operations | $124,896 | $122,077 |
Construction contract and other service revenues | 21,790 | 14,262 |
Less: Revenues from discontinued operations (Note 15) | -19 | -10,120 |
Total revenues | 146,667 | 126,219 |
Reconciliation of segment property operating expenses to property operating expenses | ' | ' |
Segment property operating expenses | 49,752 | 44,066 |
Less: Property operating expenses from discontinued operations (Note 15) | 20 | -3,678 |
Total property operating expenses | 49,772 | 40,388 |
Computation of net operating income from service operations | ' | ' |
Construction contract and other service revenues | 21,790 | 14,262 |
Construction contract and other service expenses | -18,624 | -13,477 |
NOI from service operations | 3,166 | 785 |
Reconciliation of NOI from real estate operations and NOI from service operations to (loss) income from continuing operations | ' | ' |
NOI from real estate operations | 75,144 | 78,011 |
NOI from service operations | 3,166 | 785 |
Interest and other income | 1,285 | 946 |
Equity in income of unconsolidated entities | 60 | 41 |
Income tax expense | -64 | -16 |
Other adjustments: | ' | ' |
Depreciation and other amortization associated with real estate operations | -43,596 | -27,010 |
General, administrative and leasing expenses | -8,143 | -7,820 |
Business development expenses and land carry costs | -1,326 | -1,359 |
Interest expense on continuing operations | -20,827 | -20,290 |
NOI from discontinued operations | -39 | -6,442 |
Loss on early extinguishment of debt | 0 | -5,184 |
Income from continuing operations | $5,660 | $11,662 |
Information_by_Business_Segmen4
Information by Business Segment (Details 3) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 |
In Thousands, unless otherwise specified | |||
Reconciliation of segment assets to total assets | ' | ' | ' |
Assets | $3,605,897 | $3,629,952 | $3,685,099 |
Segment assets | ' | ' | ' |
Reconciliation of segment assets to total assets | ' | ' | ' |
Assets | 2,932,749 | ' | 3,055,876 |
Non-operating property assets | ' | ' | ' |
Reconciliation of segment assets to total assets | ' | ' | ' |
Assets | 503,030 | ' | 490,083 |
Other assets | ' | ' | ' |
Reconciliation of segment assets to total assets | ' | ' | ' |
Assets | $170,118 | ' | $139,140 |
ShareBased_Compensation_Detail
Share-Based Compensation (Details) (USD $) | 3 Months Ended | 0 Months Ended | 3 Months Ended | |||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 06, 2014 | Mar. 31, 2014 | |
Restricted shares | Options | 2014 PSU Grants | 2014 PSU Grants | |||
Performance share units | Performance share units | |||||
Percentile_Rank | ||||||
Share-Based Compensation | ' | ' | ' | ' | ' | ' |
Stock awards granted (in shares or units) | ' | ' | 177,356 | ' | 49,103 | ' |
Aggregate grant date fair value | ' | ' | $4,700,000 | ' | $1,700,000 | ' |
Potential earned PSUs payout for defined levels of performance under awards | ' | ' | ' | ' | ' | ' |
Earned PSUs payout (as a percent of PSUs granted) on 75th or greater percentile rank | ' | ' | ' | ' | ' | 200.00% |
Earned PSUs payout (as a percent of PSUs granted) on 50th percentile rank | ' | ' | ' | ' | ' | 100.00% |
Earned PSUs payout (as a percent of PSUs granted) on 25th percentile rank | ' | ' | ' | ' | ' | 50.00% |
Performance share units granted on percentile rank below 25th (as a percent) | ' | ' | ' | ' | ' | 0.00% |
The number of percentile ranks to fall between to earn interpolated PSUs between such percentile ranks, conditioned on the percentile rank exceeding 25% | ' | ' | ' | ' | ' | 2 |
Performance period of the award (in years) | ' | ' | ' | ' | ' | '3 years |
Assumptions used to value stock awards | ' | ' | ' | ' | ' | ' |
Weighted average grant date fair value (in dollars per share) | ' | ' | $26.63 | ' | ' | $35.09 |
Baseline value per common share (in dollars per share) | ' | ' | ' | ' | ' | $26.52 |
Expected volatility of common shares (as a percent) | ' | ' | ' | ' | ' | 28.60% |
Risk-free interest rate (as a percent) | ' | ' | ' | ' | ' | 0.66% |
Other Share-based Compensation Additional Disclosures | ' | ' | ' | ' | ' | ' |
Shares vested (in shares) | ' | ' | 110,356 | ' | ' | ' |
Weighted average fair value of shares vested (in dollars per share) | ' | ' | $29.52 | ' | ' | ' |
Aggregate intrinsic value of restricted common shares, forfeiture restrictions lapsed | ' | ' | 2,900,000 | ' | ' | ' |
Options | ' | ' | ' | ' | ' | ' |
Exercised (in shares) | 26,614 | 16,453 | ' | 26,614 | ' | ' |
Weighted average exercise price (in dollars per share) | ' | ' | ' | $21.34 | ' | ' |
Aggregate intrinsic value of options exercised (in dollars) | ' | ' | ' | $126,000 | ' | ' |
Income_Taxes_Details
Income Taxes (Details) (Taxable REIT Subsidiary, USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Taxable REIT Subsidiary | ' | ' |
Deferred income tax (expense) benefit | ' | ' |
Federal | ($53) | ($13) |
State | -11 | -3 |
Total income tax expense | ($64) | ($16) |
Effective tax rate (as a percent) | 38.10% | 36.00% |
Discontinued_Operations_Detail
Discontinued Operations (Details) (USD $) | 3 Months Ended | 0 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 12, 2013 | Dec. 23, 2013 | Dec. 23, 2013 |
December 2013 Colorado Springs Portfolio Disposition | Baltimore and Washington Corridor | Colorado Springs | |||
Property | Property | Property | |||
Properties | ' | ' | ' | ' | ' |
Number of properties sold | ' | ' | 15 | ' | ' |
Number of properties transferred | ' | ' | ' | 9 | 5 |
Revenue from real estate operations | $19 | $10,120 | ' | ' | ' |
Property operating expenses | 20 | -3,678 | ' | ' | ' |
Depreciation and amortization | 0 | -1,242 | ' | ' | ' |
Impairment losses | -1 | -1,857 | ' | ' | ' |
General, administrative and leasing expenses | 0 | -1 | ' | ' | ' |
Interest expense | 0 | -2,081 | ' | ' | ' |
Loss on sales of real estate | -4 | 0 | ' | ' | ' |
Loss on early extinguishment of debt | -23 | 0 | ' | ' | ' |
Discontinued operations | $11 | $1,261 | ' | ' | ' |
Earnings_Per_Share_EPS_and_Ear2
Earnings Per Share ("EPS") and Earnings Per Unit ("EPU") (Details) (USD $) | 3 Months Ended | |||
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | ||
Numerator: | ' | ' | ||
Income from continuing operations | $5,660 | $11,662 | ||
Gain on sales of real estate, net | 0 | 2,354 | ||
Preferred share/unit dividends/distributions | -4,490 | -6,106 | ||
(Income) loss from continuing operations attributable to noncontrolling interests | -932 | -167 | ||
Income from continuing operations attributable to restricted shares | -121 | -118 | ||
Numerator for basic and diluted EPS from continuing operations attributable to COPT common shareholders | 117 | 7,625 | ||
Discontinued operations | 11 | 1,261 | ||
Discontinued operations attributable to noncontrolling interests | 2 | -90 | ||
Numerator for basic and diluted EPS on net income attributable to COPT common shareholders | 130 | 8,796 | ||
Denominator (all weighted averages): | ' | ' | ||
Denominator for basic EPS (common shares) | 87,080 | 81,397 | ||
Dilutive effect of share-based compensation awards | 112 | 52 | ||
Denominator for diluted EPS (common shares) | 87,192 | 81,449 | ||
Basic EPS: | ' | ' | ||
Income from continuing operations (in dollars per share/unit) | $0 | [1] | $0.09 | [1] |
Discontinued operations (in dollars per share/unit) | $0 | [1] | $0.02 | [1] |
Net income attributable to COPT common shareholders (in dollars per share/unit) | $0 | [1] | $0.11 | [1] |
Diluted EPS: | ' | ' | ||
Income from continuing operations (in dollars per share/unit) | $0 | [1] | $0.09 | [1] |
Discontinued operations (in dollars per share/unit) | $0 | [1] | $0.02 | [1] |
Net income attributable to COPT common shareholders (in dollars per share/unit) | $0 | [1] | $0.11 | [1] |
Corporate Office Properties, L.P. | ' | ' | ||
Numerator: | ' | ' | ||
Income from continuing operations | 5,660 | 11,662 | ||
Gain on sales of real estate, net | 0 | 2,354 | ||
Preferred share/unit dividends/distributions | -4,655 | -6,271 | ||
(Income) loss from continuing operations attributable to noncontrolling interests | -739 | 369 | ||
Income from continuing operations attributable to restricted shares | -121 | -118 | ||
Numerator for basic and diluted EPS from continuing operations attributable to COPT common shareholders | 145 | 7,996 | ||
Discontinued operations | 11 | 1,261 | ||
Discontinued operations attributable to noncontrolling interests | 2 | -33 | ||
Numerator for basic and diluted EPS on net income attributable to COPT common shareholders | $158 | $9,224 | ||
Denominator (all weighted averages): | ' | ' | ||
Denominator for basic EPS (common shares) | 91,038 | 85,290 | ||
Dilutive effect of share-based compensation awards | 112 | 52 | ||
Denominator for diluted EPS (common shares) | 91,150 | 85,342 | ||
Basic EPS: | ' | ' | ||
Income from continuing operations (in dollars per share/unit) | $0 | [2] | $0.09 | [2] |
Discontinued operations (in dollars per share/unit) | $0 | [2] | $0.02 | [2] |
Net income attributable to COPT common shareholders (in dollars per share/unit) | $0 | [2] | $0.11 | [2] |
Diluted EPS: | ' | ' | ||
Income from continuing operations (in dollars per share/unit) | $0 | [2] | $0.09 | [2] |
Discontinued operations (in dollars per share/unit) | $0 | [2] | $0.02 | [2] |
Net income attributable to COPT common shareholders (in dollars per share/unit) | $0 | [2] | $0.11 | [2] |
[1] | Basic and diluted earnings per common share are calculated based on amounts attributable to common shareholders of Corporate Office Properties Trust. | |||
[2] | Basic and diluted earnings per common unit are calculated based on amounts attributable to common unitholders of Corporate Office Properties, L.P. |
Earnings_Per_Share_EPS_Details
Earnings Per Share ("EPS") (Details 2) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Conversion of common units | ' | ' |
Antidilutive securities | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 3,958 | 3,893 |
Conversion of Series I Preferred Units | ' | ' |
Antidilutive securities | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 176 | 176 |
Conversion of Series K Preferred Shares | ' | ' |
Antidilutive securities | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 434 | 434 |
Weighted average restricted shares | ' | ' |
Antidilutive securities | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 390 | 409 |
Weighted average options | ' | ' |
Antidilutive securities | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 588 | 621 |
Corporate Office Properties, L.P. | Weighted average restricted shares | ' | ' |
Antidilutive securities | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 390 | 409 |
Corporate Office Properties, L.P. | Weighted average options | ' | ' |
Antidilutive securities | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 588 | 621 |
Corporate Office Properties, L.P. | Conversion of Series I preferred units | ' | ' |
Antidilutive securities | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 176 | 176 |
Corporate Office Properties, L.P. | Conversion of Series K preferred units | ' | ' |
Antidilutive securities | ' | ' |
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 434 | 434 |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (USD $) | 1 Months Ended | |
Aug. 31, 2010 | Mar. 31, 2014 | |
Property | ||
Tax incremental financing obligation | ' | ' |
The amount of tax incremental financing bonds issued by Anne Arundel County, Maryland | $30,000,000 | ' |
Liability recognized with regard to tax incremental financing obligation at end of current period | ' | 1,900,000 |
Environmental Indemnity Agreement | ' | ' |
Number of lease properties which were provided environmental indemnifications | ' | 3 |
Environmental indemnification to the tenant against losses covered under prior owner's indemnity agreement | ' | 5,000,000 |
Maximum environmental indemnification to the tenant against consequential damages after acquisition of property | ' | 12,500,000 |
Additional costs agreed to be paid by the entity related to construction and environmental regulatory activities (as a percent) | ' | 50.00% |
Maximum annual additional costs agreed to be paid by the entity related to construction and environmental regulatory activities | ' | 300,000 |
Maximum additional costs agreed to be paid by the entity related to construction and environmental regulatory activities | ' | 1,500,000 |
Nonrecourse loan guarantees of unconsolidated partnership | ' | ' |
Joint Ventures | ' | ' |
Maximum approximate amount required to be paid under the guarantees for outstanding debt, excluding interest and penalties | ' | $5,600,000 |