Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 30, 2019 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | DEA | |
Entity Registrant Name | Easterly Government Properties, Inc. | |
Entity Central Index Key | 0001622194 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 68,023,032 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Assets | ||
Real estate properties, net | $ 1,771,788 | $ 1,626,617 |
Cash and cash equivalents | 8,663 | 6,854 |
Restricted cash | 4,662 | 4,251 |
Deposits on acquisitions | 3,250 | 7,070 |
Rents receivable | 23,505 | 21,140 |
Accounts receivable | 13,650 | 11,690 |
Deferred financing, net | 2,281 | 2,459 |
Intangible assets, net | 170,157 | 165,668 |
Interest rate swaps | 3,147 | 4,563 |
Prepaid expenses and other assets | 15,638 | 11,238 |
Total assets | 2,016,741 | 1,861,550 |
Liabilities | ||
Revolving credit facility | 184,500 | 134,750 |
Term loan facilities, net | 248,329 | 248,238 |
Notes payable, net | 173,804 | 173,778 |
Mortgage notes payable, net | 208,780 | 209,589 |
Intangible liabilities, net | 29,936 | 30,835 |
Interest rate swaps | 3,398 | 1,797 |
Accounts payable and accrued liabilities | 38,248 | 37,310 |
Total liabilities | 886,995 | 836,297 |
Equity | ||
Common stock, par value $0.01, 200,000,000 shares authorized, 68,005,907 and 60,849,206 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively | 680 | 608 |
Additional paid-in capital | 1,127,938 | 1,017,415 |
Retained earnings | 12,381 | 12,831 |
Cumulative dividends | (154,944) | (139,103) |
Accumulated other comprehensive income (loss) | (219) | 2,412 |
Total stockholders’ equity | 985,836 | 894,163 |
Non-controlling interest in Operating Partnership | 143,910 | 131,090 |
Total equity | 1,129,746 | 1,025,253 |
Total liabilities and equity | $ 2,016,741 | $ 1,861,550 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) (Unaudited) - $ / shares | Mar. 31, 2019 | Dec. 31, 2018 |
Statement Of Financial Position [Abstract] | ||
Common Stock, par value | $ 0.01 | $ 0.01 |
Common Stock, shares authorized | 200,000,000 | 200,000,000 |
Common Stock, shares issued | 68,005,907 | 60,849,206 |
Common Stock, shares outstanding | 68,005,907 | 60,849,206 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues | ||
Rental income | $ 48,488 | $ 34,831 |
Total revenues | 50,607 | 35,974 |
Expenses | ||
Property operating | 9,963 | 6,560 |
Real estate taxes | 5,755 | 3,700 |
Depreciation and amortization | 22,451 | 14,634 |
Acquisition costs | 470 | 224 |
Corporate general and administrative | 4,317 | 3,459 |
Total expenses | 42,956 | 28,577 |
Other expenses | ||
Interest expense, net | (8,132) | (5,582) |
Net income (loss) | (481) | 1,815 |
Non-controlling interest in Operating Partnership | 65 | (296) |
Net income (loss) available to Easterly Government Properties, Inc. | $ (416) | $ 1,519 |
Net income (loss) available to Easterly Government Properties, Inc. per share: | ||
Basic | $ (0.01) | $ 0.03 |
Diluted | $ (0.01) | $ 0.03 |
Weighted-average common shares outstanding | ||
Basic | 61,225,926 | 45,008,062 |
Diluted | 61,225,926 | 46,018,040 |
Dividends declared per common share | $ 0.26 | $ 0.26 |
Tenant Reimbursements [Member] | ||
Revenues | ||
Total revenues | $ 1,584 | $ 941 |
Other Income [Member] | ||
Revenues | ||
Total revenues | $ 535 | $ 202 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Statement Of Income And Comprehensive Income [Abstract] | ||
Net income (loss) | $ (481) | $ 1,815 |
Other comprehensive income (loss): | ||
Unrealized gain (loss) on interest rate swaps, net | (3,017) | 1,859 |
Other comprehensive income (loss) | (3,017) | 1,859 |
Comprehensive income (loss) | (3,498) | 3,674 |
Non-controlling interest in Operating Partnership | 65 | (296) |
Other comprehensive (income) loss attributable to non-controlling interest | 386 | (373) |
Comprehensive income (loss) attributable to Easterly Government Properties, Inc. | $ (3,047) | $ 3,005 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cash flows from operating activities | ||
Net income (loss) | $ (481) | $ 1,815 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | ||
Depreciation and amortization | 22,451 | 14,634 |
Straight line rent | (974) | (1,807) |
Amortization of above- / below-market leases | (1,729) | (2,279) |
Amortization of unearned revenue | (67) | (26) |
Amortization of loan premium / discount | (20) | (21) |
Amortization of deferred financing costs | 342 | 285 |
Non-cash compensation | 734 | 864 |
Net change in: | ||
Rents receivable | (1,361) | 991 |
Accounts receivable | (1,960) | (564) |
Prepaid expenses and other assets | (4,443) | (2,613) |
Accounts payable and accrued liabilities | 1,484 | 834 |
Net cash provided by operating activities | 13,976 | 12,113 |
Cash flows from investing activities | ||
Real estate acquisitions and deposits | (148,251) | (326) |
Additions to operating properties | (895) | (890) |
Additions to development properties | (18,808) | (10,410) |
Net cash (used in) investing activities | (167,954) | (11,626) |
Cash flows from financing activities | ||
Issuance of common shares | 131,171 | 13,669 |
Credit facility draws | 178,750 | 4,000 |
Credit facility repayments | (129,000) | (5,000) |
Repayments of mortgage notes payable | (836) | (763) |
Dividends and distributions paid | (18,433) | (14,424) |
Payment of offering costs | (5,454) | (190) |
Net cash provided by (used in) financing activities | 156,198 | (2,708) |
Net increase in Cash and cash equivalents and Restricted cash | 2,220 | (2,221) |
Cash and cash equivalents and Restricted cash, beginning of period | 11,105 | 16,201 |
Cash and cash equivalents and Restricted cash, end of period | 13,325 | 13,980 |
Supplemental disclosure of cash flow information is as follows (amounts in thousands): | ||
Cash paid for interest, net of capitalized interest | 6,083 | 3,497 |
Offering costs accrued, not paid | 2 | 17 |
Deferred asset acquisition costs accrued, not paid | 70 | 8 |
Unrealized gain (loss) on interest rate swaps, net | (3,017) | 1,859 |
Exchange of Common Units for Shares of Common Stock | ||
Non-controlling interest in Operating Partnership | (493) | |
Additional paid-in capital | 493 | |
Operating Properties [Member] | ||
Supplemental disclosure of cash flow information is as follows (amounts in thousands): | ||
Additions to properties accrued, not paid | 505 | 183 |
Development Properties [Member] | ||
Supplemental disclosure of cash flow information is as follows (amounts in thousands): | ||
Additions to properties accrued, not paid | $ 10,862 | $ 2,532 |
Organization and Basis of Prese
Organization and Basis of Presentation | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Organization and Basis of Presentation | 1. Organization and Basis of Presentation The information contained in the following notes to the consolidated financial statements is condensed from that which would appear in the annual consolidated financial statements; accordingly, the consolidated financial statements included herein should be reviewed in conjunction with the consolidated financial statements for the fiscal year ended December 31, 2018, and related notes thereto, included in the Annual Report on Form 10-K of Easterly Government Properties, Inc. (the “Company”) for the year ended December 31, 2018 filed with the U.S. Securities and Exchange Commission (the “SEC”) on February 28, 2019. The Company is a Maryland corporation that has elected to be taxed as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Code”) commencing with its taxable year ended December 31, 2015. The operations of the Company are carried on primarily through Easterly Government Properties LP (the “Operating Partnership”) and the wholly owned subsidiaries of the Operating Partnership. As used herein, the “Company refer to Easterly Government Properties, Inc. and its consolidated subsidiaries and partnerships, including the Operating Partnership, except where context otherwise requires. We are an internally managed REIT, focused primarily on the acquisition, development, and management of Class A commercial properties that are leased to U.S. Government agencies that serve essential functions. We generate substantially all of our revenue by leasing our properties to such agencies, either directly or through the U.S. General Services Administration (“GSA”). Our objective is to generate attractive risk-adjusted returns for our stockholders over the long term through dividends and capital appreciation. As of March 31, 2019, we wholly owned 65 operating properties in the United States that are 100% leased, including 63 operating properties that are leased primarily to U.S. Government tenant agencies and two operating properties that are entirely leased to private tenants, encompassing approximately 5.6 million square feet in the aggregate. The Operating Partnership holds substantially all of our assets and conducts substantially all of our business. The Company is the sole general partner of the Operating Partnership. The Company owned approximately 87.3% of the aggregate limited partnership interests in the Operating Partnership (“common units”) at March 31, 2019. We believe that we have operated and have been organized in conformity with the requirements for qualification and taxation as a REIT for U.S federal income tax purposes commencing with our taxable year ended December 31, 2015. Principles of Consolidation The accompanying consolidated financial statements are presented on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of the Company, Easterly Government Properties TRS, LLC, Easterly Government Services, LLC, the Operating Partnership and its other subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. Basis of Presentation The condensed consolidated financial statements included herein are unaudited; however, they include all adjustments (consisting only of normal recurring adjustments) which, in the opinion of management, are necessary to state fairly the consolidated financial position of the Company at March 31, 2019, and the consolidated results of operations and the consolidated cash flows for the three months ended March 31, 2019 and 2018. The year-end condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by GAAP. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for the full year. The preparation of the consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the balance sheet and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies See below for the Company’s revenue recognition policy subsequent to the adoption of Accounting Standards Update (“ASU”) 2016-02, Leases discussed below. All other significant accounting policies used in the preparation of the Company’s condensed consolidated financial statements are disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. Revenue Recognition Rental income includes base rents paid by each tenant in accordance with its lease agreement conditions. We recognize rental income on a straight-line basis over the lease term of the respective leases. For acquisitions of existing buildings, we recognize rental income from leases already in place coincident with the date of property closing. Lease incentives are recorded as a deferred asset and amortized as a reduction of rental income on a straight-line basis over the respective lease term. Above- and below-market leases are amortized into Rental income over the terms of the respective leases. Further, Rental income includes certain tenant reimbursement income (real estate taxes, operating expenses, utility usage, and other reimbursements), which are accrued as variable lease payments in the same periods as the related expenses are incurred. Tenant reimbursement income includes income from tenant construction projects. We recognize revenue from tenant construction projects using the percentage of completion method when the revenue and costs for such projects can be estimated with reasonable accuracy; when these criteria do not apply to a project, we recognize revenue from that project using the completed contract method. Under the percentage of completion method, we recognize a percentage of the total estimated revenue on a project based on the cost of services provided on the project as of a point in time relative to the total estimated costs on the project. Fully reimbursed income was included within Tenant reimbursements and associated expenses were included in Property operating expenses. Income on these projects was included in Other income. Other income includes income on the associated tenant reimbursement construction projects, parking income and other miscellaneous income. Reclassifications and New Accounting Standards Certain prior year amounts have been reclassified to conform to the current year presentation. Amounts previously classified as tenant reimbursements which qualified for the practical expedient and were determined to be lease components have been reclassified to rental income to conform with current period presentation. Recently Adopted Accounting Standards In February 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU No. 2016-02, Leases, along with various subsequent ASUs, which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase of the leased asset by the lessee. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for in the same manner as the previous guidance for operating leases. The Company adopted ASU 2016-02 on January 1, 2019, using the modified retrospective transition method such that we applied the standard as of the adoption date. Going forward, ASU 2016-02, will also require that lessees and lessors capitalize, as initial direct costs, only those costs that are incurred due to the execution of a lease. Under ASU 2016-02, allocated payroll costs and other costs that are incurred regardless of whether the lease is obtained will no longer be capitalized as initial direct costs and instead will be expensed as incurred within Corporate general and administrative expense on the Company's Consolidated Statements of Operations. Additionally, in July 2018, the FASB issued ASU 2018-11, Target Improvements to Topic 842 Leases. ASU 2018-11 provides lessors a practical expedient to not separate nonlease components from the associated lease component if the timing and pattern of transfer for the lease and nonlease components are the same and if the lease component, if accounted for separately, would be classified as an operating lease. Lease components are elements of an arrangement that provide the customer with the right to use an identified asset. Nonlease components are distinct elements of a contract that are not related to securing the use of the leased asset and revenue is recognized in accordance with Accounting Standards Codification (“ASC”) 606. The Company assessed and concluded that the timing and pattern of transfer for nonlease components and the associated lease component are the same. The Company determined that the predominant component was the lease component and as such the Company has made a policy election to account for and present the lease component and the nonlease component as a single component in the revenue section of the Consolidated Statements of Operations. While application of the practical expedient did not result in a material change to the recognition of rental income, nonlease components included within Tenant reimbursement prior to the adoption of Topic 842 are now included within Rental income on the Company's Consolidated Statements of Operations. In March 2019, the FASB issued ASU 2019-01, Leases (Topic 842): Codification Improvements which amended the transition guidance in ASC 842 to explicitly exempt entities from the interim disclosures required by ASC 205 related to changes in accounting principles. The provision is applicable at the time that entities adopt ASC 842, however implementation of this update did not have a material impact on our consolidated financial statements. The adoption of this standard also resulted in a cumulative effect adjustment of less than $0.1 million recorded as a decrease to Retained earnings as of January 1, 2019 in the accompanying Consolidated Statements of Equity. The cumulative effect adjustment related to initial direct costs of leases where the Company is the lessor that, as of January 1, 2019, had not begun to amortize and therefore are no longer allowed to be capitalized under the new standard. Additionally, as of January 1, 2019, the Company recognized an operating lease right-of-use asset and related operating lease liability of approximately $1.3 million on the accompanying Consolidated Balance Sheets, related to the leases where the Company is the lessee. The lease liability associated with these leases is reflected on the Company’s Consolidated Balance Sheet within Accounts payable and accrued liabilities and the right-of-use asset is included within Prepaid expenses and other assets. Associated lease expense will be recognized on a straight-line basis over the expected lease term based on the total lease payments and is included within Corporate general and administrative expense in the . On January 1, 2019, the Company adopted ASU 2017-12 (Topic 815), Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities. The purpose of this updated guidance is to better align a company’s financial reporting for hedging activities with the economic objectives of those activities. The Company adopted this ASU using the modified retrospective method and the adoption did not have a material impact on our consolidated financial statements. |
Real Estate and Intangibles
Real Estate and Intangibles | 3 Months Ended |
Mar. 31, 2019 | |
Real Estate [Abstract] | |
Real Estate and Intangibles | 3. Real Estate and Intangibles During the three months ended March 31, 2019, we acquired three operating properties in asset acquisitions, consisting of the Final Closing Properties (as defined below) for an aggregate purchase price of $152.1 million. We allocated the aggregate purchase price based on the estimated fair values of the acquired assets and assumed liabilities as follows (amounts in thousands): Total Real estate Land $ 12,396 Building 122,954 Acquired tenant improvements 2,694 Total real estate 138,044 Intangible assets In-place leases 13,356 Acquired leasing commissions 1,753 Above-market leases 161 Total intangible assets 15,270 Intangible liabilities Below-market leases (1,202 ) Total intangible liabilities (1,202 ) Purchase price $ 152,112 The intangible assets and liabilities of operating properties acquired during the three months ended March 31, 2019 have a weighted average amortization period of 5.22 years as of March 31, 2019. During the three months ended March 31, 2019, we included $2.2 million of revenues and $0.1 million of net income in our Consolidated Statements of Operations related to the Final Closing Properties (as defined below). On June 15, 2018, we entered into a purchase and sale agreement to acquire a 1,479,762-square foot portfolio of 14 properties (the “Portfolio Properties”) for an aggregate purchase price of approximately $430.0 million. On September 13, 2018, we completed the acquisition of eight of the Portfolio Properties, consisting of the following (listed by primary tenant agency, if applicable, and location): Various GSA - Buffalo, NY, Various GSA - Chicago, IL, TREAS - Parkersburg, WV, SSA - Charleston, WV, FBI - Pittsburgh, PA, GSA - Clarksburg, WV, ICE - Pittsburgh, PA and SSA - Dallas, TX. On October 16, 2018, we completed the acquisition of three additional Portfolio Properties consisting of the following (listed by primary tenant agency and location): JUD - Charleston, SC, VA - Baton Rouge, LA and DEA - Bakersfield, CA. The Company completed the acquisition of the three remaining Portfolio Properties on January 31, 2019 (the “Final Closing Properties”). The Final Closing Properties include the following (listed by primary tenant agency, if applicable, and location): DEA - Sterling, VA, FDA - College Park, MD and Various GSA - Portland, OR. During the three months ended March 31, 2019, we incurred $0.5 million of acquisition-related expenses mainly consisting of internal costs associated with property acquisitions. Consolidated Real Estate and Intangibles Real estate and intangibles consisted of the following as of March 31, 2019 (amounts in thousands): Total Real estate properties, net Land $ 173,966 Building 1,571,965 Acquired tenant improvements 70,479 Construction in progress 73,222 Accumulated depreciation (117,844 ) Total Real estate properties, net 1,771,788 Intangible assets, net In-place leases 219,178 Acquired leasing commissions 45,559 Above market leases 11,054 Accumulated amortization (105,634 ) Total Intangible assets, net 170,157 Intangible liabilities, net Below market leases (65,895 ) Accumulated amortization 35,959 Total Intangible liabilities, net $ (29,936 ) The following table summarizes the scheduled amortization of the Company’s acquired above- and below-market lease intangibles for each of the five succeeding years as of March 31, 2019 (amounts in thousands): Acquired Above-Market Lease Intangibles Acquired Below-Market Lease Intangibles 2019 $ 1,057 $ (5,632 ) 2020 1,169 (6,855 ) 2021 729 (4,784 ) 2022 639 (3,175 ) 2023 616 (2,976 ) Above-market lease amortization reduces Rental income on our Consolidated Statements of Operations and below-market lease amortization increases Rental income on our Consolidated Statements of Operations. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt | 4. Debt At March 31, 2019, our consolidated borrowings consisted of the following (amounts in thousands): Principal Outstanding Interest Current Loan March 31, 2019 Rate (1) Maturity Revolving credit facility: Revolving credit facility (2) $ 184,500 L + 125bps June 2022 (3) Total revolving credit facility 184,500 Term loan facilities: 2016 term loan facility 100,000 2.62% (4) March 2024 2018 term loan facility 150,000 3.91% (5) June 2023 Total term loan facilities 250,000 Less: Total unamortized deferred financing fees (1,671 ) Total term loan facilities, net 248,329 Notes payable: Senior unsecured notes payable, series A 95,000 4.05% May 2027 Senior unsecured notes payable, series B 50,000 4.15% May 2029 Senior unsecured notes payable, series C 30,000 4.30% May 2032 Total notes payable 175,000 Less: Total unamortized deferred financing fees (1,196 ) Total notes payable, net 173,804 Mortgage notes payable: CBP - Savannah 13,312 3.40% (6) July 2033 ICE - Charleston 18,338 4.21% (6) January 2027 MEPCOM - Jacksonville 9,659 4.41% (6) October 2025 USFS II - Albuquerque 16,501 4.46% (6) July 2026 DEA - Pleasanton 15,700 L + 150bps (6) October 2023 VA - Loma Linda 127,500 3.59% (6) July 2027 VA - Golden 9,300 5.00% (6) April 2024 Total mortgage notes payable 210,310 Less: Total unamortized deferred financing fees (1,788 ) Less: Total unamortized premium/discount 258 Total mortgage notes payable, net 208,780 Total debt $ 815,413 (1) At March 31, 2019, the one-month LIBOR (“L”) was 2.49%. The current interest rate is not adjusted to include the amortization of deferred financing fees or debt issuance costs incurred in obtaining debt or any unamortized fair market value premiums. The spread over the applicable rate for our revolving credit facility and term loan facilities is based on the Company’s consolidated leverage ratio, as defined in the respective loan agreements. (2) Available capacity of $265.5 million at March 31, 2019 with an accordion feature that provides additional capacity of up to $250.0 million, subject to the satisfaction of customary terms and conditions. (3) Our revolving credit facility has two six-month as-of-right extension options subject to certain conditions and the payment of an extension fee. (4) Entered into two interest rate swaps with an effective date of March 29, 2017 with an aggregate notional value of $100.0 million to effectively fix the interest rate at 2.62% annually, based on the Company’s consolidated leverage ratio, as defined in the 2016 term loan facility agreement. (5) Entered into four interest rate swaps with an effective date of December 13, 2018 with an aggregate notional value of $150.0 million to effectively fix the interest rate at 3.91% annually, based on the Company’s consolidated leverage ratio, as defined in the 2018 term loan facility agreement. (6) Effective interest rates are as follows: CBP - Savannah 4.12%, ICE - Charleston 3.93%, MEPCOM - Jacksonville 3.89%, USFS II - Albuquerque 3.92%, DEA - Pleasanton 1.8%, VA - Loma Linda 3.78%, VA - Golden 5.03%. Financial Covenant Considerations The Company was in compliance with all financial and other covenants as of March 31, 2019 related to its revolving credit facility, 2016 term loan facility, 2018 term loan facility, notes payable and mortgage notes payable. Fair Value of Debt As of March 31, 2019, the carrying value of our revolving credit facility approximated fair value. In determining the fair value we considered the short term maturity, variable interest rate and credit spreads. We deem the fair value of our revolving credit facility as a Level 3 measurement. As of March 31, 2019, the carrying value of our 2016 term loan facility approximated fair value. In determining the fair value we considered the variable interest rate and credit spreads. We deem the fair value of our 2016 term loan facility as a Level 3 measurement. As of March 31, 2019, the carrying value of our 2018 term loan facility approximated fair value. In determining the fair value we considered the variable interest rate and credit spreads. We deem the fair value of our 2018 term loan facility as a Level 3 measurement. As of March 31, 2019, the fair value of our notes payable was determined by discounting future contractual principal and interest payments using prevailing market rates. We deem the fair value measurement of our notes payable instruments as a Level 3 measurement. At March 31, 2019, the fair value of our notes payable was $177.4 million. As of March 31, 2019, the fair value of our mortgage notes payable was determined by discounting future contractual principal and interest payments using prevailing market rates. We deem the fair value measurement of our mortgage notes payable instruments as a Level 3 measurement. At March 31, 2019, the fair value of our mortgage notes payable was $209.4 . |
Derivatives and Hedging Activit
Derivatives and Hedging Activities | 3 Months Ended |
Mar. 31, 2019 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivatives and Hedging Activities | 5. Derivatives and Hedging Activities The following table sets forth the key terms and fair values of our interest rate swap derivatives, each of which was designated as a cash flow hedge as of March 31, 2019 (amounts in thousands): Notional Amount Fixed Rate Floating Rate Index Effective Date Expiration Date Fair Value $ 100,000 1.41 % One-Month LIBOR March 29, 2017 September 29, 2023 $ 3,147 $ 150,000 2.71 % One-Month LIBOR December 13, 2018 June 19, 2023 $ (3,398 ) The table below sets forth the fair value of our interest rate derivatives as well as their classification on our consolidated balance sheet as of March 31, 2019 (amounts in thousands): Balance Sheet Line Item Interest rate swaps - Asset $ 3,147 Interest rate swaps - Liability $ (3,398 ) Cash Flow Hedges of Interest Rate Risk The gains or losses on derivatives designated and that qualify as cash flow hedges is recorded in Accumulated other comprehensive income (loss) and will be reclassified to interest expense in the period that the hedged forecasted transactions affect earnings on the Company’s variable rate debt. Amounts reported in Accumulated other comprehensive income (loss) related to derivatives designated as qualifying cash flow hedges will be reclassified to interest expense as interest payments are made on the Company's variable rate debt. The Company estimates that $0.5 million will be reclassified from Accumulated other comprehensive income (loss) as a decrease to interest expense over the next 12 months. The table below presents the effects of our interest rate derivatives on our Consolidated Statements of Operations and Comprehensive Income (amounts in thousands): For the three months ended March 31, 2019 2018 Unrealized gain (loss) recognized in AOCI $ (2,825 ) $ 1,906 Gain (loss) reclassified from AOCI into interest expense 192 47 Credit-Risk-Related Contingent Features The Company has agreements with each of its derivative counterparties that contain a provision where the Company could be declared in default on its derivative obligations if repayment of the underlying indebtedness is accelerated by the lender due to the Company’s default on such indebtedness. As of March 31, 2019, the net fair value of derivatives in a liability position related to these agreements was $2.3 million. As of March 31, 2019, the Company had not breached the provisions of these agreements and has not posted any collateral related to these agreements. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 6. Fair Value Measurements Accounting standards define fair value as the exit price, or the amount that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standards also establish a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability developed based on market data obtained from sources independent of us. Unobservable inputs are inputs that reflect our assumptions about the factors market participants would use in valuing the asset or liability developed based upon the best information available in the circumstances. The hierarchy of these inputs is broken down into three levels: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. Categorization within the valuation hierarchy is based upon the lowest level of input that is most significant to the fair value measurement. Recurring fair value measurements The fair values of our interest rate swaps are determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities in such interest rates. While the Company determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by the Company and its counterparties. The Company has determined that the significance of the impact of the credit valuation adjustments made to its derivative contracts, which determination was based on the fair value of each individual contract, was not significant to the overall valuation. As a result, all of the Company’s derivatives held as of March 31, 2019 were classified as Level 2 of the fair value hierarchy. The carrying values of cash and cash equivalents, restricted cash, accounts receivable, other assets and accounts payable and accrued expenses are reasonable estimates of fair values because of the short maturities of these instruments. For our disclosure of debt fair values in Note 4, we estimated the fair value of our 2016 term loan facility and our 2018 term loan facility based on the variable interest rate and credit spreads (categorized within Level 3 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 included scheduled principal and interest payments. Fair value estimates are made as of 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. The table below presents the Company’s assets and liabilities measured at fair value on a recurring basis as of March 31, 2019, aggregated by the level in the fair value hierarchy within which those measurements fall (amounts in thousands): As of March 31, 2019 Balance Sheet Line Item Level 1 Level 2 Level 3 Interest rate swaps - Asset $ — $ 3,147 $ — Interest rate swaps - Liability $ — $ (3,398 ) $ — |
Equity
Equity | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Equity | 7. Equity The following table summarizes the changes in our stockholders’ equity for the three months ended March 31, 2019 and 2018 (amounts in thousands, except share amounts): Shares Common Stock Par Value Additional Paid-in Capital Retained Earnings (Deficit) Cumulative Dividends Accumulated Other Comprehensive Income (Loss) Non- controlling Interest in Operating Partnership Total Equity Three months ended March 31, 2019 Balance at December 31, 2018 60,849,206 $ 608 $ 1,017,415 $ 12,831 $ (139,103 ) $ 2,412 $ 131,090 $ 1,025,253 Cumulative effect adjustment related to adoption of Leases (Topic 842) — — (34 ) — — — (34 ) Stock based compensation — 183 — — — 551 734 Dividends and distributions paid ($0.26 per share) — — — (15,841 ) — (2,592 ) (18,433 ) Grant of unvested restricted stock 57,121 1 (1 ) — — — — — Redemption of common units for shares of common stock 33,125 — 493 — — — (493 ) — Issuance of common stock 7,066,455 71 125,653 — — — — 125,724 Unrealized loss on interest rate swaps, net — — — — (2,631 ) (386 ) (3,017 ) Net loss — — (416 ) (65 ) (481 ) Allocation of non-controlling interest in Operating Partnership — (15,805 ) — — — 15,805 — Balance at March 31, 2019 68,005,907 $ 680 $ 1,127,938 $ 12,381 $ (154,944 ) $ (219 ) $ 143,910 $ 1,129,746 Three months ended March 31, 2018 Balance at December 31, 2017 44,787,040 $ 448 $ 740,546 $ 7,127 $ (83,718 ) $ 3,403 $ 123,283 $ 791,089 Stock based compensation — 81 — — — 783 864 Dividends and distributions paid ($0.26 per share) — — — (11,729 ) — (2,695 ) (14,424 ) Issuance of common stock 671,666 7 13,482 — — — — 13,489 Unrealized gain on interest rate swaps, net — — — — 1,486 373 1,859 Net income — — 1,519 — — 296 1,815 Allocation of non-controlling interest in Operating Partnership — (13,020 ) — — — 13,020 — Balance at March 31, 2018 45,458,706 $ 455 $ 741,089 $ 8,646 $ (95,447 ) $ 4,889 $ 135,060 $ 794,692 During the quarter ending March 31, 2019, the Company granted an aggregate of 143,538 performance-based long term incentive plan units in the Operating Partnership (“LTIP units”) to members of management pursuant to the 2015 Equity Incentive Plan, as amended (the “2015 Equity Incentive Plan”) subject to the Company achieving certain absolute and relative total shareholder returns through the performance period. The awards consist of two separate tranches of 45,238 LTIP units and 98,300 LTIP units with performance periods ending on December 31, 2020 and December 31, 2021, respectively. Fifty percent of the LTIP Units vest when earned following the end of the applicable performance period and 50% of the earned award is subject to an additional one year of vesting. The Company also granted, during the quarter ending March 31, 2019, an aggregate of 54,041 shares of restricted common stock to members of management pursuant to the 2015 Equity Incentive Plan, of which an aggregate of 17,645 shares will vest on January 18, 2021 and an aggregate of 36,396 shares will vest on January 18, 2022. On March 11, 2019, the Company issued an aggregate of 3,080 shares of restricted common stock to certain employees pursuant to the 2015 Equity Incentive Plan. The shares of restricted common stock will vest upon the second anniversary of the grant date so long as the grantee remains an employee of the Company on such date. A summary of our shares of restricted common stock and LTIP unit awards at March 31, 2019 is as follows: Restricted Shares Restricted Shares Weighted Average Grant Date Fair Value Per Share LTIP Units LTIP Units Weighted Average Grant Date Fair Value Per Share Outstanding, December 31, 2018 24,020 $ 20.74 636,381 $ 11.47 Granted 57,121 17.04 143,538 19.20 Vested (2,692 ) 19.79 (463,000 ) 8.91 Forfeited — — (32,448 ) 19.15 Outstanding, March 31, 2019 78,449 $ 18.08 284,471 $ 18.66 We recognized $0.7 million in compensation expense related to our shares of restricted common stock and the LTIP unit awards for the three months ended March 31, 2019. As of March 31, 2019, unrecognized compensation expense for both sets of awards was $5.1 million, which will be amortized over the vesting period. A summary of dividends declared by the Company’s board of directors per share of common stock and per common unit at the date of record is as follows: Quarter Declaration Date Record Date Pay Date Dividend (1) Q1 2019 May 2, 2019 June 10, 2019 June 27, 2019 $ 0.26 (1) Prior to the end of the performance period as set forth in the applicable LTIP unit award, holders of LTIP units are entitled to receive dividends per LTIP unit equal to 10% of the dividend paid per common unit. After the end of the performance period, the number of LTIP units, both vested and unvested, that LTIP award recipients have earned, if any, are entitled to receive dividends in an amount per LTIP unit equal to dividends, both regular and special, payable per common unit. ATM Programs On March 3, 2017, we entered into separate equity distribution agreements with each of Citigroup Global Markets Inc., BTIG, LLC, Jefferies LLC, Raymond James & Associates, Inc., RBC Capital Markets, LLC and SunTrust Robinson Humphrey, Inc., pursuant to which we may issue and sell shares of our common stock having an aggregate offering price of up to $100.0 million from time to time (the “2017 ATM Program”) in negotiated transactions or transactions that are deemed to be “at the market” offerings as defined in Rule 415 under the Securities Act of 1933 as amended (the “Securities Act”). On March 4, 2019, we entered into separate equity distribution agreements with each of Citigroup Global Markets Inc., BMO Capital Markets Corp., BTIG, LLC, Capital One Securities, Inc., Jefferies LLC, Raymond James & Associates, Inc., RBC Capital Markets, LLC, SunTrust Robinson Humphrey, Inc. and Wells Fargo Securities, LLC pursuant to which we may issue and sell shares of our common stock having an aggregate offering price of up to $200.0 million from time to time (the “2019 ATM Program” and together with the 2017 ATM Program, the “ATM Programs”) in negotiated transactions or transactions that are deemed to be “at the market” offerings as defined in Rule 415 under the Securities Act. Under the 2019 ATM Program, we may also enter into one or more forward transactions under separate master forward sale confirmations and related supplemental confirmations with each of Citibank, N.A., Bank of Montreal, Jefferies LLC, Raymond James & Associates, Inc., Royal Bank of Canada and Wells Fargo Bank, National Association for the sale of shares of our common stock on a forward basis. No sales of shares of our common stock were made under the 2019 ATM Program during the quarter ending March 31, 2019. The following table sets forth certain information with respect to sales made under the 2017 ATM Program as of March 31, 2019 (amounts in thousands except share amounts) : For the Three Months Ended: Number of Shares Sold Net Proceeds March 31, 2019 366,455 $ 6,504 We have used the proceeds from such sales for general corporate purposes. As of March 31, 2019, we had approximately $225.8 million of gross sales of our common stock available under the ATM Programs, including approximately $25.8 million of gross sales available under the 2017 ATM Program. Offering of Common Stock on a Forward Basis On June 21, 2018, we completed an underwritten public offering of an aggregate of 20,700,000 The public offering included 13,700,000 shares sold by us directly to the underwriters (including 2,700,000 shares pursuant to the underwriters’ exercise of their option to purchase additional shares), resulting in net proceeds to us of approximately $252.9 million, after deducting underwriting discounts and commissions and our offering expenses. In connection with the public offering, we also entered into forward sale agreements On March 27, 2019, we physically settled a portion of the forward sale agreements by issuing an aggregate of 6,700,000 shares of our common stock in exchange for approximately $119.2 million in net proceeds after deducting underwriting discounts and commissions and our offering expenses. The Company accounted for the forward sale agreements as equity. Subject to our right to elect cash or net share settlement, we expect to physically settle the remaining 300,000 shares underlying the forward sale agreements no later than June 21, 2019. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 8. Earnings Per Share Basic earnings or loss per share of common stock (“EPS”) is calculated by dividing net income attributable to common stockholders by the weighted average shares of common stock outstanding for the periods presented. Diluted EPS is computed after adjusting the basic EPS computation for the effect of dilutive common equivalent shares outstanding during the periods presented. Unvested restricted shares of common stock and unvested LTIP units are considered participating securities, which require the use of the two-class method for the computation of basic and diluted earnings per share. The following table sets forth the computation of the Company’s basic and diluted earnings per share of common stock for the three months ended March 31, 2019 and 2018 (amounts in thousands, except per share amounts): For the three months ended March 31, 2019 2018 Numerator Net income (loss) $ (481 ) $ 1,815 Less: Non-controlling interest in Operating Partnership 65 (296 ) Net income (loss) available to Easterly Government Properties, Inc. (416 ) 1,519 Less: Dividends on participating securities (28 ) (279 ) Net income (loss) available to common stockholders $ (444 ) $ 1,240 Denominator for basic EPS 61,225,926 45,008,062 Dilutive effect of share-based compensation awards — 12,803 Dilutive effect of LTIP units (1) — 997,175 Denominator for diluted EPS 61,225,926 46,018,040 Basic EPS $ (0.01 ) $ 0.03 Diluted EPS $ (0.01 ) $ 0.03 (1) During the three months ended March 31, 2019, there were approximately 284,471 unvested performance-based LTIP units, 78,449 unvested restricted shares and 300,000 unsettled forward shares that were not included in the computation of diluted earnings per share because to do so would have been antidilutive for the period. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Leases | 9. Leases Lessor The Company leases commercial space to the U.S. Government through the GSA or other federal agencies or nongovernmental tenants. These leases may contain extension options that are predominately at the sole discretion of the tenant. Certain of our leases contain a “soft-term” period of the lease, meaning that the U.S. Government tenant agency has the right to terminate the lease prior to its stated lease end date. While certain of our leases are contractually subject to early termination, we do not believe that our tenant agencies are likely to terminate these leases early given the build-to-suit features at the properties subject to the leases, the weighted average age of these properties based on the date the property was built or renovated-to-suit, where applicable (approximately 16.0 years as of March 31, 2019), the mission-critical focus of the properties subject to the leases and the current level of operations at such properties. Certain lease agreements include variable lease payments that, in the future, will vary based on changes in inflationary measures, real estate tax rates, usage, or share of expenditures of the leased premises . As discussed above in Note 2, the Company elected a practical expedient to not separate nonlease components from the associated lease component if the time and pattern of transfer for the lease and nonlease components are the same and if the lease component, if accounted for separately, would be classified as an operating lease. The following table summarizes the maturity of fixed lease payments under the Company’s leases as of March 31, 2019 (amounts in thousands): Payments due by period Total 2019 2020 2021 2022 2023 Thereafter Fixed lease payments $ 1,301,581 121,731 149,508 125,182 107,914 98,424 698,822 Prior to the adoption of ASC 842 on January 1, 2019, the Company’s leases associated with its operating properties fell under the guidance of ASC 840. As of December 31, 2018, the future non-cancelable minimum contractual rent payments on our operating properties were as follows (amounts in thousands): Payments due by period Total 2019 2020 2021 2022 2023 Thereafter Operating Leases Minimum lease payments $ 1,251,546 151,152 139,315 116,827 99,822 92,392 652,038 Lessee In October 2015, we entered into a sublease agreement for office space in Washington, D.C. with a commencement date of March 2016 and expiration date of June 2021. We also lease office space in San Diego, CA under an operating lease that commenced February 2015 and expires in April 2022. Neither of the leases contain extension options, however they do include variable lease payments that, in the future, will vary based on changes in real estate tax rates, usage, or share of expenditures of the leased premises. The Company has elected not to separate lease and nonlease components for both corporate office leases. As of March 31, 2019, the Company recognized a right-of-use operating lease asset and operating lease liability of $1.2 million for the Company’s two office leases. The Company used its incremental borrowing rate, which was arrived at utilizing prevailing market rates and the spread on our revolving credit facility, in order to determine the net present value of the minimum lease payments. The following table provides quantitative information for the Company’s operating leases as of March 31, 2019 (amounts in thousands): As of March 31, 2019 Operating leases costs $ 1,275 Other Information Weighted average remaining lease terms (in years) 2.63 Weighted average discount rate 3.84 % In addition, the maturity of fixed lease payments under the Company’s corporate office leases as of March 31, 2019 is summarized in the table below (amounts in thousands): Payments due by period Total 2019 2020 2021 2022 2023 Thereafter Fixed lease payments $ 1,275 362 496 352 65 — — Prior to the adoption of ASC 842 on January 1, 2019, the Company’s corporate office leases fell under the guidance of ASC 840. As of December 31, 2018, the future minimum rental payments under the Company’s corporate office leases were as follows (amounts in thousands): Payments due by period Total 2019 2020 2021 2022 2023 Thereafter Corporate office leases Minimum lease payments $ 1,392 479 496 352 65 — — |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2019 | |
Revenue From Contract With Customer [Abstract] | |
Revenue | 10. Revenue The table below sets forth revenue from tenant construction projects disaggregated by tenant agency for the three months ended March 31, 2019 and March 31, 2018 (amounts in thousands): For the three months ended March 31, Tenant 2019 2018 Federal Bureau of Investigation (“FBI”) $ 1,119 $ 58 Department of Veteran Affairs (“VA”) 450 787 Drug Enforcement Administration (“DEA”) 127 23 Food and Drug Administration (“FDA”) 77 — U.S. Forest Service (“USFS”) 16 29 U.S. Citizenship and Immigration Services (“USCIS”) 14 — Internal Revenue Service (“IRS”) 6 — The Judiciary of the U.S. Government (“JUD”) 4 100 Social Security Administration (“SSA”) 1 — U.S. Coast Guard (“USCG”) — 6 Immigration and Customs Enforcement (“ICE”) — 9 National Park Service (“NPS”) — 31 $ 1,814 $ 1,043 The balance in Accounts receivable related to tenant construction projects was $3.4 million as of March 31, 2019 and $2.4 million as of December 31, 2018. The duration of the majority of tenant construction project reimbursement arrangements are less than a year and payment is typically due once a project is complete and work has been accepted by the tenant. There were no projects ongoing as of March 31, 2019 with a duration of greater than one year. During the three months ended March 31, 2019, the Company also recognized $0.2 million in parking garage income generated from the operations of parking garages situated on the Various GSA - Buffalo property acquired in third quarter of 2018 and on the Various GSA - Portland property acquired in the first quarter of 2019. The monthly and transient daily parking revenue falls within the scope of ASC 606 and is accounted for at the point in time when control of the goods or services transfers to the customer and the Company’s performance obligation is satisfied. No parking garage income was generated during the three months ended March 31, 2018. The balance in Accounts receivable related to parking garage income was $0.1 million as of March 31, 2019 and less than $0.1 million as of December 31, 2018. Additionally, the Company also earns credits on its utility bills at certain properties for the use of energy efficient building materials, which also fall within the scope of ASC 606. The pattern of recognition for the credits is in line with the recognition of the associated utility expense. The Company recognized less than $0.1 million in energy credit income during both the three months ended March 31, 2019 and March 31, 2018. There were no contract assets or liabilities as of March 31, 2019 or December 31, 2018. |
Concentrations Risk
Concentrations Risk | 3 Months Ended |
Mar. 31, 2019 | |
Risks And Uncertainties [Abstract] | |
Concentrations Risk | 11. Concentrations Risk Concentrations of credit risk arise for the Company when multiple tenants of the Company are engaged in similar business activities, are located in the same geographic region or have similar economic features that impact in a similar manner their ability to meet contractual obligations, including those to the Company. The Company regularly monitors its tenant base to assess potential concentrations of credit risk. As stated in Note 1 above, the Company leases commercial space to the U.S. Government or nongovernmental tenants. At March 31, 2019, the U.S Government accounted for approximately 98.2% of rental income and non-governmental tenants accounted for the remaining approximately 1.8%. Seventeen of our 65 operating properties are located in California, accounting for approximately 22.3% of our total rentable square feet and approximately 28.2% of our total annualized lease income as of March 31, 2019. In addition, we owned one property under development located in California. To the extent that weak economic or real estate conditions or natural disasters affect California more severely than other areas of the country, our business, financial condition and results of operations could be significantly impacted. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | 12. Subsequent Events For its consolidated financial statements as of March 31, 2019, the Company evaluated subsequent events and noted no significant events. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Revenue Recognition | Revenue Recognition Rental income includes base rents paid by each tenant in accordance with its lease agreement conditions. We recognize rental income on a straight-line basis over the lease term of the respective leases. For acquisitions of existing buildings, we recognize rental income from leases already in place coincident with the date of property closing. Lease incentives are recorded as a deferred asset and amortized as a reduction of rental income on a straight-line basis over the respective lease term. Above- and below-market leases are amortized into Rental income over the terms of the respective leases. Further, Rental income includes certain tenant reimbursement income (real estate taxes, operating expenses, utility usage, and other reimbursements), which are accrued as variable lease payments in the same periods as the related expenses are incurred. Tenant reimbursement income includes income from tenant construction projects. We recognize revenue from tenant construction projects using the percentage of completion method when the revenue and costs for such projects can be estimated with reasonable accuracy; when these criteria do not apply to a project, we recognize revenue from that project using the completed contract method. Under the percentage of completion method, we recognize a percentage of the total estimated revenue on a project based on the cost of services provided on the project as of a point in time relative to the total estimated costs on the project. Fully reimbursed income was included within Tenant reimbursements and associated expenses were included in Property operating expenses. Income on these projects was included in Other income. Other income includes income on the associated tenant reimbursement construction projects, parking income and other miscellaneous income. |
Reclassifications and New Accounting Standards | Reclassifications and New Accounting Standards Certain prior year amounts have been reclassified to conform to the current year presentation. Amounts previously classified as tenant reimbursements which qualified for the practical expedient and were determined to be lease components have been reclassified to rental income to conform with current period presentation. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards In February 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU No. 2016-02, Leases, along with various subsequent ASUs, which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase of the leased asset by the lessee. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for in the same manner as the previous guidance for operating leases. The Company adopted ASU 2016-02 on January 1, 2019, using the modified retrospective transition method such that we applied the standard as of the adoption date. Going forward, ASU 2016-02, will also require that lessees and lessors capitalize, as initial direct costs, only those costs that are incurred due to the execution of a lease. Under ASU 2016-02, allocated payroll costs and other costs that are incurred regardless of whether the lease is obtained will no longer be capitalized as initial direct costs and instead will be expensed as incurred within Corporate general and administrative expense on the Company's Consolidated Statements of Operations. Additionally, in July 2018, the FASB issued ASU 2018-11, Target Improvements to Topic 842 Leases. ASU 2018-11 provides lessors a practical expedient to not separate nonlease components from the associated lease component if the timing and pattern of transfer for the lease and nonlease components are the same and if the lease component, if accounted for separately, would be classified as an operating lease. Lease components are elements of an arrangement that provide the customer with the right to use an identified asset. Nonlease components are distinct elements of a contract that are not related to securing the use of the leased asset and revenue is recognized in accordance with Accounting Standards Codification (“ASC”) 606. The Company assessed and concluded that the timing and pattern of transfer for nonlease components and the associated lease component are the same. The Company determined that the predominant component was the lease component and as such the Company has made a policy election to account for and present the lease component and the nonlease component as a single component in the revenue section of the Consolidated Statements of Operations. While application of the practical expedient did not result in a material change to the recognition of rental income, nonlease components included within Tenant reimbursement prior to the adoption of Topic 842 are now included within Rental income on the Company's Consolidated Statements of Operations. In March 2019, the FASB issued ASU 2019-01, Leases (Topic 842): Codification Improvements which amended the transition guidance in ASC 842 to explicitly exempt entities from the interim disclosures required by ASC 205 related to changes in accounting principles. The provision is applicable at the time that entities adopt ASC 842, however implementation of this update did not have a material impact on our consolidated financial statements. The adoption of this standard also resulted in a cumulative effect adjustment of less than $0.1 million recorded as a decrease to Retained earnings as of January 1, 2019 in the accompanying Consolidated Statements of Equity. The cumulative effect adjustment related to initial direct costs of leases where the Company is the lessor that, as of January 1, 2019, had not begun to amortize and therefore are no longer allowed to be capitalized under the new standard. Additionally, as of January 1, 2019, the Company recognized an operating lease right-of-use asset and related operating lease liability of approximately $1.3 million on the accompanying Consolidated Balance Sheets, related to the leases where the Company is the lessee. The lease liability associated with these leases is reflected on the Company’s Consolidated Balance Sheet within Accounts payable and accrued liabilities and the right-of-use asset is included within Prepaid expenses and other assets. Associated lease expense will be recognized on a straight-line basis over the expected lease term based on the total lease payments and is included within Corporate general and administrative expense in the . On January 1, 2019, the Company adopted ASU 2017-12 (Topic 815), Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities. The purpose of this updated guidance is to better align a company’s financial reporting for hedging activities with the economic objectives of those activities. The Company adopted this ASU using the modified retrospective method and the adoption did not have a material impact on our consolidated financial statements. |
Real Estate and Intangibles (Ta
Real Estate and Intangibles (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Real Estate [Abstract] | |
Fair Values of Assets Acquired and Liabilities Assumed | During the three months ended March 31, 2019, we acquired three operating properties in asset acquisitions, consisting of the Final Closing Properties (as defined below) for an aggregate purchase price of $152.1 million. We allocated the aggregate purchase price based on the estimated fair values of the acquired assets and assumed liabilities as follows (amounts in thousands): Total Real estate Land $ 12,396 Building 122,954 Acquired tenant improvements 2,694 Total real estate 138,044 Intangible assets In-place leases 13,356 Acquired leasing commissions 1,753 Above-market leases 161 Total intangible assets 15,270 Intangible liabilities Below-market leases (1,202 ) Total intangible liabilities (1,202 ) Purchase price $ 152,112 |
Schedule of Real Estate and Intangibles | Real estate and intangibles consisted of the following as of March 31, 2019 (amounts in thousands): Total Real estate properties, net Land $ 173,966 Building 1,571,965 Acquired tenant improvements 70,479 Construction in progress 73,222 Accumulated depreciation (117,844 ) Total Real estate properties, net 1,771,788 Intangible assets, net In-place leases 219,178 Acquired leasing commissions 45,559 Above market leases 11,054 Accumulated amortization (105,634 ) Total Intangible assets, net 170,157 Intangible liabilities, net Below market leases (65,895 ) Accumulated amortization 35,959 Total Intangible liabilities, net $ (29,936 ) |
Summary of Scheduled Amortization Market Lease Intangibles | The following table summarizes the scheduled amortization of the Company’s acquired above- and below-market lease intangibles for each of the five succeeding years as of March 31, 2019 (amounts in thousands): Acquired Above-Market Lease Intangibles Acquired Below-Market Lease Intangibles 2019 $ 1,057 $ (5,632 ) 2020 1,169 (6,855 ) 2021 729 (4,784 ) 2022 639 (3,175 ) 2023 616 (2,976 ) |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Summary of Borrowings | At March 31, 2019, our consolidated borrowings consisted of the following (amounts in thousands): Principal Outstanding Interest Current Loan March 31, 2019 Rate (1) Maturity Revolving credit facility: Revolving credit facility (2) $ 184,500 L + 125bps June 2022 (3) Total revolving credit facility 184,500 Term loan facilities: 2016 term loan facility 100,000 2.62% (4) March 2024 2018 term loan facility 150,000 3.91% (5) June 2023 Total term loan facilities 250,000 Less: Total unamortized deferred financing fees (1,671 ) Total term loan facilities, net 248,329 Notes payable: Senior unsecured notes payable, series A 95,000 4.05% May 2027 Senior unsecured notes payable, series B 50,000 4.15% May 2029 Senior unsecured notes payable, series C 30,000 4.30% May 2032 Total notes payable 175,000 Less: Total unamortized deferred financing fees (1,196 ) Total notes payable, net 173,804 Mortgage notes payable: CBP - Savannah 13,312 3.40% (6) July 2033 ICE - Charleston 18,338 4.21% (6) January 2027 MEPCOM - Jacksonville 9,659 4.41% (6) October 2025 USFS II - Albuquerque 16,501 4.46% (6) July 2026 DEA - Pleasanton 15,700 L + 150bps (6) October 2023 VA - Loma Linda 127,500 3.59% (6) July 2027 VA - Golden 9,300 5.00% (6) April 2024 Total mortgage notes payable 210,310 Less: Total unamortized deferred financing fees (1,788 ) Less: Total unamortized premium/discount 258 Total mortgage notes payable, net 208,780 Total debt $ 815,413 (1) At March 31, 2019, the one-month LIBOR (“L”) was 2.49%. The current interest rate is not adjusted to include the amortization of deferred financing fees or debt issuance costs incurred in obtaining debt or any unamortized fair market value premiums. The spread over the applicable rate for our revolving credit facility and term loan facilities is based on the Company’s consolidated leverage ratio, as defined in the respective loan agreements. (2) Available capacity of $265.5 million at March 31, 2019 with an accordion feature that provides additional capacity of up to $250.0 million, subject to the satisfaction of customary terms and conditions. (3) Our revolving credit facility has two six-month as-of-right extension options subject to certain conditions and the payment of an extension fee. (4) Entered into two interest rate swaps with an effective date of March 29, 2017 with an aggregate notional value of $100.0 million to effectively fix the interest rate at 2.62% annually, based on the Company’s consolidated leverage ratio, as defined in the 2016 term loan facility agreement. (5) Entered into four interest rate swaps with an effective date of December 13, 2018 with an aggregate notional value of $150.0 million to effectively fix the interest rate at 3.91% annually, based on the Company’s consolidated leverage ratio, as defined in the 2018 term loan facility agreement. (6) Effective interest rates are as follows: CBP - Savannah 4.12%, ICE - Charleston 3.93%, MEPCOM - Jacksonville 3.89%, USFS II - Albuquerque 3.92%, DEA - Pleasanton 1.8%, VA - Loma Linda 3.78%, VA - Golden 5.03%. |
Derivatives and Hedging Activ_2
Derivatives and Hedging Activities (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Schedule of Key Terms and Fair Values of Our Interest Rate Swap Derivatives | The following table sets forth the key terms and fair values of our interest rate swap derivatives, each of which was designated as a cash flow hedge as of March 31, 2019 (amounts in thousands): Notional Amount Fixed Rate Floating Rate Index Effective Date Expiration Date Fair Value $ 100,000 1.41 % One-Month LIBOR March 29, 2017 September 29, 2023 $ 3,147 $ 150,000 2.71 % One-Month LIBOR December 13, 2018 June 19, 2023 $ (3,398 ) |
Schedule of Fair Value of Our Interest Rate Derivatives as Well as Their Classification on Our Consolidated Balance Sheets | The table below sets forth the fair value of our interest rate derivatives as well as their classification on our consolidated balance sheet as of March 31, 2019 (amounts in thousands): Balance Sheet Line Item Interest rate swaps - Asset $ 3,147 Interest rate swaps - Liability $ (3,398 ) |
Schedule of Effects of Our Interest Rate Derivatives on Our Consolidated Statements of Operations and Comprehensive Income | The table below presents the effects of our interest rate derivatives on our Consolidated Statements of Operations and Comprehensive Income (amounts in thousands): For the three months ended March 31, 2019 2018 Unrealized gain (loss) recognized in AOCI $ (2,825 ) $ 1,906 Gain (loss) reclassified from AOCI into interest expense 192 47 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis | The table below presents the Company’s assets and liabilities measured at fair value on a recurring basis as of March 31, 2019, aggregated by the level in the fair value hierarchy within which those measurements fall (amounts in thousands): As of March 31, 2019 Balance Sheet Line Item Level 1 Level 2 Level 3 Interest rate swaps - Asset $ — $ 3,147 $ — Interest rate swaps - Liability $ — $ (3,398 ) $ — |
Equity (Tables)
Equity (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Summary of Changes In Stockholders' Equity | The following table summarizes the changes in our stockholders’ equity for the three months ended March 31, 2019 and 2018 (amounts in thousands, except share amounts): Shares Common Stock Par Value Additional Paid-in Capital Retained Earnings (Deficit) Cumulative Dividends Accumulated Other Comprehensive Income (Loss) Non- controlling Interest in Operating Partnership Total Equity Three months ended March 31, 2019 Balance at December 31, 2018 60,849,206 $ 608 $ 1,017,415 $ 12,831 $ (139,103 ) $ 2,412 $ 131,090 $ 1,025,253 Cumulative effect adjustment related to adoption of Leases (Topic 842) — — (34 ) — — — (34 ) Stock based compensation — 183 — — — 551 734 Dividends and distributions paid ($0.26 per share) — — — (15,841 ) — (2,592 ) (18,433 ) Grant of unvested restricted stock 57,121 1 (1 ) — — — — — Redemption of common units for shares of common stock 33,125 — 493 — — — (493 ) — Issuance of common stock 7,066,455 71 125,653 — — — — 125,724 Unrealized loss on interest rate swaps, net — — — — (2,631 ) (386 ) (3,017 ) Net loss — — (416 ) (65 ) (481 ) Allocation of non-controlling interest in Operating Partnership — (15,805 ) — — — 15,805 — Balance at March 31, 2019 68,005,907 $ 680 $ 1,127,938 $ 12,381 $ (154,944 ) $ (219 ) $ 143,910 $ 1,129,746 Three months ended March 31, 2018 Balance at December 31, 2017 44,787,040 $ 448 $ 740,546 $ 7,127 $ (83,718 ) $ 3,403 $ 123,283 $ 791,089 Stock based compensation — 81 — — — 783 864 Dividends and distributions paid ($0.26 per share) — — — (11,729 ) — (2,695 ) (14,424 ) Issuance of common stock 671,666 7 13,482 — — — — 13,489 Unrealized gain on interest rate swaps, net — — — — 1,486 373 1,859 Net income — — 1,519 — — 296 1,815 Allocation of non-controlling interest in Operating Partnership — (13,020 ) — — — 13,020 — Balance at March 31, 2018 45,458,706 $ 455 $ 741,089 $ 8,646 $ (95,447 ) $ 4,889 $ 135,060 $ 794,692 |
Summary of Shares of Restricted Common Stock and Long-term Incentive Plan Units in Operating Partnership Awards | A summary of our shares of restricted common stock and LTIP unit awards at March 31, 2019 is as follows: Restricted Shares Restricted Shares Weighted Average Grant Date Fair Value Per Share LTIP Units LTIP Units Weighted Average Grant Date Fair Value Per Share Outstanding, December 31, 2018 24,020 $ 20.74 636,381 $ 11.47 Granted 57,121 17.04 143,538 19.20 Vested (2,692 ) 19.79 (463,000 ) 8.91 Forfeited — — (32,448 ) 19.15 Outstanding, March 31, 2019 78,449 $ 18.08 284,471 $ 18.66 |
Summary of Dividends Declared | A summary of dividends declared by the Company’s board of directors per share of common stock and per common unit at the date of record is as follows: Quarter Declaration Date Record Date Pay Date Dividend (1) Q1 2019 May 2, 2019 June 10, 2019 June 27, 2019 $ 0.26 (1) Prior to the end of the performance period as set forth in the applicable LTIP unit award, holders of LTIP units are entitled to receive dividends per LTIP unit equal to 10% of the dividend paid per common unit. After the end of the performance period, the number of LTIP units, both vested and unvested, that LTIP award recipients have earned, if any, are entitled to receive dividends in an amount per LTIP unit equal to dividends, both regular and special, payable per common unit. |
Schedule of Information with Respect to ATM Program | The following table sets forth certain information with respect to sales made under the 2017 ATM Program as of March 31, 2019 (amounts in thousands except share amounts) : For the Three Months Ended: Number of Shares Sold Net Proceeds March 31, 2019 366,455 $ 6,504 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Summary of Basic and Diluted Earnings Per Common Share | The following table sets forth the computation of the Company’s basic and diluted earnings per share of common stock for the three months ended March 31, 2019 and 2018 (amounts in thousands, except per share amounts): For the three months ended March 31, 2019 2018 Numerator Net income (loss) $ (481 ) $ 1,815 Less: Non-controlling interest in Operating Partnership 65 (296 ) Net income (loss) available to Easterly Government Properties, Inc. (416 ) 1,519 Less: Dividends on participating securities (28 ) (279 ) Net income (loss) available to common stockholders $ (444 ) $ 1,240 Denominator for basic EPS 61,225,926 45,008,062 Dilutive effect of share-based compensation awards — 12,803 Dilutive effect of LTIP units (1) — 997,175 Denominator for diluted EPS 61,225,926 46,018,040 Basic EPS $ (0.01 ) $ 0.03 Diluted EPS $ (0.01 ) $ 0.03 (1) During the three months ended March 31, 2019, there were approximately 284,471 unvested performance-based LTIP units, 78,449 unvested restricted shares and 300,000 unsettled forward shares that were not included in the computation of diluted earnings per share because to do so would have been antidilutive for the period. |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Summary of Maturity of Fixed Lease Payments Under Company's Leases | The following table summarizes the maturity of fixed lease payments under the Company’s leases as of March 31, 2019 (amounts in thousands): Payments due by period Total 2019 2020 2021 2022 2023 Thereafter Fixed lease payments $ 1,301,581 121,731 149,508 125,182 107,914 98,424 698,822 |
Summary of Future Non Cancellable Minimum Contractual Rent Payments | Prior to the adoption of ASC 842 on January 1, 2019, the Company’s leases associated with its operating properties fell under the guidance of ASC 840. As of December 31, 2018, the future non-cancelable minimum contractual rent payments on our operating properties were as follows (amounts in thousands): Payments due by period Total 2019 2020 2021 2022 2023 Thereafter Operating Leases Minimum lease payments $ 1,251,546 151,152 139,315 116,827 99,822 92,392 652,038 |
Schedule of Quantitative Information for Company's Operating Leases | The following table provides quantitative information for the Company’s operating leases as of March 31, 2019 (amounts in thousands): As of March 31, 2019 Operating leases costs $ 1,275 Other Information Weighted average remaining lease terms (in years) 2.63 Weighted average discount rate 3.84 % |
Schedule of Maturity of Fixed Lease Payments Under Company's Corporate Office Leases | In addition, the maturity of fixed lease payments under the Company’s corporate office leases as of March 31, 2019 is summarized in the table below (amounts in thousands): Payments due by period Total 2019 2020 2021 2022 2023 Thereafter Fixed lease payments $ 1,275 362 496 352 65 — — |
Corporate Office Leases [Member] | |
Summary of Future Non Cancellable Minimum Contractual Rent Payments | Prior to the adoption of ASC 842 on January 1, 2019, the Company’s corporate office leases fell under the guidance of ASC 840. As of December 31, 2018, the future minimum rental payments under the Company’s corporate office leases were as follows (amounts in thousands): Payments due by period Total 2019 2020 2021 2022 2023 Thereafter Corporate office leases Minimum lease payments $ 1,392 479 496 352 65 — — |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Revenue From Contract With Customer [Abstract] | |
Summary of Revenue from Tenant Construction Projects Disaggregated by Tenant Agency | The table below sets forth revenue from tenant construction projects disaggregated by tenant agency for the three months ended March 31, 2019 and March 31, 2018 (amounts in thousands): For the three months ended March 31, Tenant 2019 2018 Federal Bureau of Investigation (“FBI”) $ 1,119 $ 58 Department of Veteran Affairs (“VA”) 450 787 Drug Enforcement Administration (“DEA”) 127 23 Food and Drug Administration (“FDA”) 77 — U.S. Forest Service (“USFS”) 16 29 U.S. Citizenship and Immigration Services (“USCIS”) 14 — Internal Revenue Service (“IRS”) 6 — The Judiciary of the U.S. Government (“JUD”) 4 100 Social Security Administration (“SSA”) 1 — U.S. Coast Guard (“USCG”) — 6 Immigration and Customs Enforcement (“ICE”) — 9 National Park Service (“NPS”) — 31 $ 1,814 $ 1,043 |
Organization and Basis of Pre_2
Organization and Basis of Presentation - Additional Information (Detail) ft² in Millions | 3 Months Ended |
Mar. 31, 2019ft²Property | |
Organization And Significant Accounting Policies [Line Items] | |
Outstanding common units of aggregate limited partnership interest owned percentage | 87.30% |
Wholly Owned Operating Properties [Member] | |
Organization And Significant Accounting Policies [Line Items] | |
Number of properties | 65 |
Leased percentage of operating properties | 100.00% |
Aggregate area of land | ft² | 5.6 |
Wholly Owned Operating Properties [Member] | Government [Member] | |
Organization And Significant Accounting Policies [Line Items] | |
Number of properties | 63 |
Wholly Owned Operating Properties [Member] | Private Tenants [Member] | |
Organization And Significant Accounting Policies [Line Items] | |
Number of properties | 2 |
Wholly Owned Properties Under Development [Member] | |
Organization And Significant Accounting Policies [Line Items] | |
Number of properties | 2 |
Aggregate area of land | ft² | 0.1 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($) $ in Millions | Mar. 31, 2019 | Jan. 01, 2019 |
Accounting Policies [Line Items] | ||
Right-of-use asset | $ 1.2 | |
ASU 2016-02 [Member] | ||
Accounting Policies [Line Items] | ||
Right-of-use asset | $ 1.3 | |
Lease liability | 1.3 | |
ASU 2016-02 [Member] | Maximum [Member] | ||
Accounting Policies [Line Items] | ||
Cumulative effect adjustment, decrease to retained earnings | $ (0.1) |
Real Estate and Intangibles - A
Real Estate and Intangibles - Additional Information (Detail) $ in Thousands | Jun. 15, 2018USD ($)ft²Property | Mar. 31, 2019USD ($)Property | Mar. 31, 2018USD ($) | Jan. 31, 2019Property | Oct. 16, 2018Property | Sep. 13, 2018Property |
Real Estate Properties [Line Items] | ||||||
Revenues | $ 50,607 | $ 35,974 | ||||
Net income available to Easterly Government Properties, Inc. | (416) | 1,519 | ||||
Acquisition-related expenses | 470 | $ 224 | ||||
Operating Properties Acquired [Member] | ||||||
Real Estate Properties [Line Items] | ||||||
Acquisition-related expenses | $ 500 | |||||
Portfolio Properties [Member] | Purchase and Sale Agreement [Member] | ||||||
Real Estate Properties [Line Items] | ||||||
Number of properties | Property | 14 | 3 | ||||
Area of properties acquired | ft² | 1,479,762 | |||||
Purchase price | $ 430,000 | |||||
First Closing Properties [Member] | Purchase and Sale Agreement [Member] | ||||||
Real Estate Properties [Line Items] | ||||||
Number of properties | Property | 8 | |||||
Final Closing [Member] | Purchase and Sale Agreement [Member] | ||||||
Real Estate Properties [Line Items] | ||||||
Number of properties | Property | 3 | |||||
DEA Sterling, VA, FDA College Park, MD and Various GSA Portland, OR [Member] | Operating Properties Acquired [Member] | ||||||
Real Estate Properties [Line Items] | ||||||
Number of properties | Property | 3 | |||||
Purchase price | $ 152,100 | |||||
Weighted average amortization period | 5 years 2 months 19 days | |||||
Revenues | $ 2,200 | |||||
Net income available to Easterly Government Properties, Inc. | $ 100 |
Real Estate and Intangibles - F
Real Estate and Intangibles - Fair Values of Assets Acquired and Liabilities Assumed (Detail) - Operating Properties Acquired [Member] - DEA Sterling, VA, FDA College Park, MD and Various GSA Portland, OR [Member] $ in Thousands | Mar. 31, 2019USD ($) |
Business Acquisition [Line Items] | |
Total real estate | $ 138,044 |
Total intangible assets | 15,270 |
Total intangible liabilities | (1,202) |
Purchase price | 152,112 |
Real Estate Investment [Member] | |
Business Acquisition [Line Items] | |
Land | 12,396 |
Building | 122,954 |
Acquired tenant improvements | 2,694 |
In-place leases [Member] | |
Business Acquisition [Line Items] | |
Total intangible assets | 13,356 |
Acquired Leasing Commissions [Member] | |
Business Acquisition [Line Items] | |
Total intangible assets | 1,753 |
Above Market Leases [Member] | |
Business Acquisition [Line Items] | |
Total intangible assets | 161 |
Below Market Leases [Member] | |
Business Acquisition [Line Items] | |
Total intangible liabilities | $ (1,202) |
Real Estate and Intangibles - S
Real Estate and Intangibles - Schedule of Real Estate and Intangibles (Detail) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Real estate properties, net | ||
Land | $ 173,966 | |
Building | 1,571,965 | |
Acquired tenant improvements | 70,479 | |
Construction in progress | 73,222 | |
Accumulated depreciation | (117,844) | |
Total Real estate properties, net | 1,771,788 | $ 1,626,617 |
Intangible assets, net | ||
Accumulated amortization | (105,634) | |
Total Intangible assets, net | 170,157 | |
Intangible liabilities, net | ||
Intangible Liabilities, Below market leases | (65,895) | |
Intangible Liabilities, Accumulated amortization | 35,959 | |
Total Intangible liabilities, net | (29,936) | |
In-place leases [Member] | ||
Intangible assets, net | ||
Above market leases | 219,178 | |
Acquired Leasing Commissions [Member] | ||
Intangible assets, net | ||
Above market leases | 45,559 | |
Above Market Leases [Member] | ||
Intangible assets, net | ||
Above market leases | $ 11,054 |
Real Estate and Intangibles -_2
Real Estate and Intangibles - Summary of Scheduled Amortization Market Lease Intangibles (Detail) $ in Thousands | Mar. 31, 2019USD ($) |
Acquired Above-Market Lease Intangibles | |
2019 | $ 1,057 |
2020 | 1,169 |
2021 | 729 |
2022 | 639 |
2023 | 616 |
Acquired Below-Market Lease Intangibles | |
2019 | (5,632) |
2020 | (6,855) |
2021 | (4,784) |
2022 | (3,175) |
2023 | $ (2,976) |
Debt - Summary of Borrowings (D
Debt - Summary of Borrowings (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Dec. 31, 2018 | ||
Debt Instrument [Line Items] | |||
Revolving credit facility | $ 184,500 | $ 134,750 | |
Less: Total unamortized deferred financing fees | (2,281) | (2,459) | |
Total term loan facilities, net, Principal Outstanding | 248,329 | 248,238 | |
Total notes payable, net, Principal Outstanding | 173,804 | 173,778 | |
Total mortgage notes payable, net, Principal Outstanding | 208,780 | $ 209,589 | |
Total debt, Principal Outstanding | 815,413 | ||
Revolving Credit Facility [Member] | |||
Debt Instrument [Line Items] | |||
Revolving credit facility | [1] | $ 184,500 | |
Loan, Interest Rate | [1],[2] | L + 125bps | |
Loan, Current Maturity | [1],[3] | 2022-06 | |
2016 Term Loan Facility [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 100,000 | ||
Loan, Interest Rate | [2],[4] | 2.62% | |
Loan, Current Maturity | 2024-03 | ||
2018 Term Loan Facility [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 150,000 | ||
Loan, Interest Rate | [2],[5] | 3.91% | |
Loan, Current Maturity | 2023-06 | ||
Term Loan Facility [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 250,000 | ||
Less: Total unamortized deferred financing fees | (1,671) | ||
Total term loan facilities, net, Principal Outstanding | 248,329 | ||
Senior Unsecured Notes Payable [Member] | 4.05% Senior Notes, Series A, due May 25, 2027 [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 95,000 | ||
Loan, Interest Rate | [2] | 4.05% | |
Loan, Current Maturity | 2027-05 | ||
Senior Unsecured Notes Payable [Member] | 4.15% Senior Notes, Series B, due May 25, 2029 [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 50,000 | ||
Loan, Interest Rate | [2] | 4.15% | |
Loan, Current Maturity | 2029-05 | ||
Senior Unsecured Notes Payable [Member] | 4.30% Senior Notes, Series C, due May 25, 2032 [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 30,000 | ||
Loan, Interest Rate | [2] | 4.30% | |
Loan, Current Maturity | 2032-05 | ||
Notes Payable [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 175,000 | ||
Less: Total unamortized deferred financing fees | (1,196) | ||
Mortgage Notes Payable [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | 210,310 | ||
Less: Total unamortized deferred financing fees | (1,788) | ||
Less: Total unamortized premium/discount | 258 | ||
Mortgage Notes Payable [Member] | CBP Savannah [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 13,312 | ||
Loan, Interest Rate | [2],[6] | 3.40% | |
Loan, Current Maturity | 2033-07 | ||
Mortgage Notes Payable [Member] | ICE Charleston [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 18,338 | ||
Loan, Interest Rate | [2],[6] | 4.21% | |
Loan, Current Maturity | 2027-01 | ||
Mortgage Notes Payable [Member] | MEPCOM Jacksonville [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 9,659 | ||
Loan, Interest Rate | [2],[6] | 4.41% | |
Loan, Current Maturity | 2025-10 | ||
Mortgage Notes Payable [Member] | USFS II Albuquerque [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 16,501 | ||
Loan, Interest Rate | [2],[6] | 4.46% | |
Loan, Current Maturity | 2026-07 | ||
Mortgage Notes Payable [Member] | DEA Pleasanton [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 15,700 | ||
Loan, Interest Rate | [2],[6] | L + 150bps | |
Loan, Current Maturity | 2023-10 | ||
Mortgage Notes Payable [Member] | VA Loma Linda [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 127,500 | ||
Loan, Interest Rate | [2],[6] | 3.59% | |
Loan, Current Maturity | 2027-07 | ||
Mortgage Notes Payable [Member] | VA Golden [Member] | |||
Debt Instrument [Line Items] | |||
Loan, Principal Outstanding | $ 9,300 | ||
Loan, Interest Rate | [2],[6] | 5.00% | |
Loan, Current Maturity | 2024-04 | ||
[1] | Available capacity of $265.5 million at March 31, 2019 with an accordion feature that provides additional capacity of up to $250.0 million, subject to the satisfaction of customary terms and conditions. | ||
[2] | At March 31, 2019, the one-month LIBOR (“L”) was 2.49%. The current interest rate is not adjusted to include the amortization of deferred financing fees or debt issuance costs incurred in obtaining debt or any unamortized fair market value premiums. The spread over the applicable rate for our revolving credit facility and term loan facilities is based on the Company’s consolidated leverage ratio, as defined in the respective loan agreements. | ||
[3] | Our revolving credit facility has two six-month as-of-right extension options subject to certain conditions and the payment of an extension fee. | ||
[4] | Entered into two interest rate swaps with an effective date of March 29, 2017 with an aggregate notional value of $100.0 million to effectively fix the interest rate at 2.62% annually, based on the Company’s consolidated leverage ratio, as defined in the 2016 term loan facility agreement | ||
[5] | Entered into four interest rate swaps with an effective date of December 13, 2018 with an aggregate notional value of $150.0 million to effectively fix the interest rate at 3.91% annually, based on the Company’s consolidated leverage ratio, as defined in the 2018 term loan facility agreement. | ||
[6] | Effective interest rates are as follows: CBP - Savannah 4.12%, ICE - Charleston 3.93%, MEPCOM - Jacksonville 3.89%, USFS II - Albuquerque 3.92%, DEA - Pleasanton 1.8%, VA - Loma Linda 3.78%, VA - Golden 5.03%. |
Debt - Summary of Borrowings (P
Debt - Summary of Borrowings (Parenthetical) (Detail) | Mar. 31, 2019USD ($)Swap | Mar. 31, 2019USD ($)Swap |
CBP Savannah [Member] | Mortgage Notes Payable [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 4.12% | 4.12% |
ICE Charleston [Member] | Mortgage Notes Payable [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 3.93% | 3.93% |
MEPCOM Jacksonville [Member] | Mortgage Notes Payable [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 3.89% | 3.89% |
USFS II Albuquerque [Member] | Mortgage Notes Payable [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 3.92% | 3.92% |
DEA Pleasanton [Member] | Mortgage Notes Payable [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 1.80% | 1.80% |
VA Loma Linda [Member] | Mortgage Notes Payable [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 3.78% | 3.78% |
VA Golden [Member] | Mortgage Notes Payable [Member] | ||
Debt Instrument [Line Items] | ||
Effective interest rate | 5.03% | 5.03% |
2016 Term Loan Facility [Member] | Interest Rate Swaps [Member] | ||
Debt Instrument [Line Items] | ||
Number of forward interest rate swaps | Swap | 2 | 2 |
Forward swaps effective date | Mar. 29, 2017 | |
Aggregate notional value of interest rate swaps | $ 100,000,000 | $ 100,000,000 |
Forward swaps interest rate | 2.62% | 2.62% |
2018 Term Loan Facility [Member] | Interest Rate Swaps [Member] | ||
Debt Instrument [Line Items] | ||
Number of forward interest rate swaps | Swap | 4 | 4 |
Forward swaps effective date | Dec. 13, 2018 | |
Aggregate notional value of interest rate swaps | $ 150,000,000 | $ 150,000,000 |
Forward swaps interest rate | 3.91% | 3.91% |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Amount available under revolving credit facility | $ 265,500,000 | $ 265,500,000 |
Credit facility additional maximum borrowing capacity | $ 250,000,000 | $ 250,000,000 |
Line of Credit Facility, Description | Revolving credit facility has two six-month as-of-right extension options subject to certain conditions and the payment of an extension fee. | |
LIBOR [Member] | ||
Debt Instrument [Line Items] | ||
Loan, interest rate | 2.49% |
Debt - Additional Information (
Debt - Additional Information (Detail) $ in Millions | Mar. 31, 2019USD ($) |
Debt Instrument [Line Items] | |
Fair value of notes payable | $ 177.4 |
Mortgage Notes Payable [Member] | |
Debt Instrument [Line Items] | |
Fair value of debt | $ 209.4 |
Derivative and Hedging Activiti
Derivative and Hedging Activities - Schedule of Key Terms and Fair Values of Our Interest Rate Swap Derivatives (Detail) | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Interest Swap Rate at 1.14 % Fixed Rate[Member] | |
Derivative [Line Items] | |
Aggregate notional value of interest rate swaps | $ 100,000,000 |
Forward swaps interest rate | 1.41% |
Floating Rate Index | One-Month LIBOR |
Forward swaps effective date | Mar. 29, 2017 |
Expiration Date | Sep. 29, 2023 |
Fair Value | $ 3,147,000 |
Interest Swap Rate at 2.71 % Fixed Rate[Member] | |
Derivative [Line Items] | |
Aggregate notional value of interest rate swaps | $ 150,000,000 |
Forward swaps interest rate | 2.71% |
Floating Rate Index | One-Month LIBOR |
Forward swaps effective date | Dec. 13, 2018 |
Expiration Date | Jun. 19, 2023 |
Fair Value | $ (3,398,000) |
Derivative and Hedging Activi_2
Derivative and Hedging Activities - Schedule of Fair Value of Our Interest Rate Derivatives as Well as Their Classification on Our Consolidated Balance Sheets (Detail) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | ||
Interest rate swaps - Asset | $ 3,147 | $ 4,563 |
Interest rate swaps - Liability | $ (3,398) | $ (1,797) |
Derivative and Hedging Activi_3
Derivative and Hedging Activities - Additional Information (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Estimates reclassified from accumulated other comprehensive income decrease to interest expense over the next 12 months | $ 0.5 |
Credit risk related contingent features derivatives, net fair value of derivatives in liability position | $ 2.3 |
Derivative and Hedging Activi_4
Derivative and Hedging Activities - Schedule of Effects of Our Interest Rate Derivatives on Our Consolidated Statements of Operations and Comprehensive Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | ||
Unrealized gain (loss) recognized in AOCI | $ (2,825) | $ 1,906 |
Gain (loss) reclassified from AOCI into interest expense | $ 192 | $ 47 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Interest rate swaps - Asset | $ 3,147 | $ 4,563 |
Interest rate swaps - Liability | (3,398) | $ (1,797) |
Fair Value Measured on Recurring Basis [Member] | Level 2 [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Interest rate swaps - Asset | 3,147 | |
Interest rate swaps - Liability | $ (3,398) |
Equity - Summary of Changes In
Equity - Summary of Changes In Stockholders' Equity (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Shareholders Equity [Line Items] | ||
Balance | $ 1,025,253 | $ 791,089 |
Stock based compensation | 734 | 864 |
Dividends and distributions paid ($0.26 per share) | (18,433) | (14,424) |
Issuance of common stock | 125,724 | 13,489 |
Unrealized gain (loss) on interest rate swaps, net | (3,017) | 1,859 |
Net income (loss) | (481) | 1,815 |
Balance | $ 1,129,746 | 794,692 |
Balance (in shares) | 68,005,907 | |
ASU 2016-02 [Member] | ||
Shareholders Equity [Line Items] | ||
Cumulative effect adjustment related to adoption of Leases | $ (34) | |
Common Stock Par Value [Member] | ||
Shareholders Equity [Line Items] | ||
Balance | $ 608 | $ 448 |
Balance (in shares) | 60,849,206 | 44,787,040 |
Grant of unvested restricted stock | $ 1 | |
Grant of unvested restricted stock (in shares) | 57,121 | |
Redemption of common units for shares of common stock (in shares) | 33,125 | |
Issuance of common stock | $ 71 | $ 7 |
Issuance of common stock (in share) | 7,066,455 | 671,666 |
Balance | $ 680 | $ 455 |
Balance (in shares) | 68,005,907 | 45,458,706 |
Additional Paid-in Capital [Member] | ||
Shareholders Equity [Line Items] | ||
Balance | $ 1,017,415 | $ 740,546 |
Stock based compensation | 183 | 81 |
Grant of unvested restricted stock | (1) | |
Redemption of common units for shares of common stock | 493 | |
Issuance of common stock | 125,653 | 13,482 |
Allocation of non-controlling interest in Operating Partnership | (15,805) | (13,020) |
Balance | 1,127,938 | 741,089 |
Retained Earnings (Deficit) [Member] | ||
Shareholders Equity [Line Items] | ||
Balance | 12,831 | 7,127 |
Net income (loss) | (416) | 1,519 |
Balance | 12,381 | 8,646 |
Retained Earnings (Deficit) [Member] | ASU 2016-02 [Member] | ||
Shareholders Equity [Line Items] | ||
Cumulative effect adjustment related to adoption of Leases | (34) | |
Cumulative Dividends [Member] | ||
Shareholders Equity [Line Items] | ||
Balance | (139,103) | (83,718) |
Dividends and distributions paid ($0.26 per share) | (15,841) | (11,729) |
Balance | (154,944) | (95,447) |
Accumulated Other Comprehensive Income (Loss) [Member] | ||
Shareholders Equity [Line Items] | ||
Balance | 2,412 | 3,403 |
Unrealized gain (loss) on interest rate swaps, net | (2,631) | 1,486 |
Balance | (219) | 4,889 |
Non-controlling Interest in Operating Partnership [Member] | ||
Shareholders Equity [Line Items] | ||
Balance | 131,090 | 123,283 |
Stock based compensation | 551 | 783 |
Dividends and distributions paid ($0.26 per share) | (2,592) | (2,695) |
Redemption of common units for shares of common stock | (493) | |
Unrealized gain (loss) on interest rate swaps, net | (386) | 373 |
Net income (loss) | (65) | 296 |
Allocation of non-controlling interest in Operating Partnership | 15,805 | 13,020 |
Balance | $ 143,910 | $ 135,060 |
Equity - Summary of Changes I_2
Equity - Summary of Changes In Stockholders' Equity (Parenthetical) (Detail) - $ / shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Equity [Abstract] | ||
Dividends declared per common share | $ 0.26 | $ 0.26 |
Equity - Additional Information
Equity - Additional Information (Detail) | Mar. 27, 2019USD ($)shares | Mar. 11, 2019shares | Mar. 04, 2019USD ($) | Jun. 21, 2018USD ($)shares | Mar. 03, 2017USD ($) | Mar. 31, 2019USD ($)Trancheshares | Dec. 31, 2018shares |
Stockholders Equity Note Disclosure [Line Items] | |||||||
Unrecognized compensation expense | $ | $ 5,100,000 | ||||||
Aggregate offering price of shares of common stock that the Company may issue and sell | $ | $ 100,000,000 | ||||||
Common Stock, shares issued | 68,005,907 | 60,849,206 | |||||
Underwritten Public Offering [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Common Stock, shares issued | 20,700,000 | ||||||
Shares offered directly by the company | 13,700,000 | ||||||
Underwriters option to purchase additional shares | 2,700,000 | ||||||
Gross proceeds from shares sold to underwriters | $ | $ 252,900,000 | ||||||
Forward sales agreements settlement date | Jun. 21, 2019 | ||||||
Forward Sales Agreement [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Common Stock, shares issued | 6,700,000 | 7,000,000 | |||||
Proceeds from issuance of common stock | $ | $ 119,200,000 | ||||||
Number of shares remain avaliable under forward sale agreements | 300,000 | ||||||
2015 Equity Incentive Plan [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Compensation expense recognized | $ | $ 700,000 | ||||||
2015 Equity Incentive Plan [Member] | Employee [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Restricted common stock issued | 3,080 | ||||||
Restricted common stock grants, vesting description | The shares of restricted common stock will vest upon the second anniversary of the grant date so long as the grantee remains an employee of the Company on such date. | ||||||
2017 and 2019 ATM Programs [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Aggregate offering price of shares of common stock that the Company may issue and sell | $ | $ 200,000,000 | ||||||
2019 ATM Program [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Number of shares sold | 0 | ||||||
ATM Program [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Gross sale of common stock available for grant | $ | $ 225,800,000 | ||||||
2017 ATM Program [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Number of shares sold | 366,455 | ||||||
Gross sale of common stock available for grant | $ | $ 25,800,000 | ||||||
Vesting on January 18, 2021 [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Restricted stock granted | 17,645 | ||||||
Vesting on January 18, 2022 [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Restricted stock granted | 36,396 | ||||||
Long Term Incentive Plan [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Number of tranches | Tranche | 2 | ||||||
Percentage of awards vesting when earned following completion of applicable performance period | 50.00% | ||||||
Percentage of awards earned subject to additional year of vesting | 50.00% | ||||||
Additional vesting year of awards | 1 year | ||||||
Restricted stock granted | 143,538 | ||||||
Long Term Incentive Plan [Member] | 2015 Equity Incentive Plan [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Aggregate performance-based units granted | 143,538 | ||||||
Long Term Incentive Plan [Member] | Tranche One [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Aggregate performance-based units granted | 45,238 | ||||||
Long Term Incentive Plan [Member] | Tranche Two [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Aggregate performance-based units granted | 98,300 | ||||||
Restricted Common Stock [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Restricted stock granted | 57,121 | ||||||
Restricted Common Stock [Member] | 2015 Equity Incentive Plan [Member] | |||||||
Stockholders Equity Note Disclosure [Line Items] | |||||||
Restricted stock granted | 54,041 |
Equity - Summary of Shares of R
Equity - Summary of Shares of Restricted Common Stock and Long-term Incentive Plan Units in Operating Partnership Awards (Detail) | 3 Months Ended |
Mar. 31, 2019$ / sharesshares | |
Restricted Shares [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Shares/Units, Outstanding beginning balance | shares | 24,020 |
Shares/Units, Granted | shares | 57,121 |
Shares/Units, Vested | shares | (2,692) |
Shares/Units, Outstanding ending balance | shares | 78,449 |
Weighted Average Grant Date Fair Value Per Share, Outstanding beginning balance | $ / shares | $ 20.74 |
Weighted Average Grant Date Fair Value Per Share, Granted | $ / shares | 17.04 |
Weighted Average Grant Date Fair Value Per Share, Vested | $ / shares | 19.79 |
Weighted Average Grant Date Fair Value Per Share, Outstanding ending balance | $ / shares | $ 18.08 |
Long Term Incentive Plan [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Shares/Units, Outstanding beginning balance | shares | 636,381 |
Shares/Units, Granted | shares | 143,538 |
Shares/Units, Vested | shares | (463,000) |
Shares/Units, Forfeited | shares | (32,448) |
Shares/Units, Outstanding ending balance | shares | 284,471 |
Weighted Average Grant Date Fair Value Per Share, Outstanding beginning balance | $ / shares | $ 11.47 |
Weighted Average Grant Date Fair Value Per Share, Granted | $ / shares | 19.20 |
Weighted Average Grant Date Fair Value Per Share, Vested | $ / shares | 8.91 |
Weighted Average Grant Date Fair Value Per Share, Forfeited | $ / shares | 19.15 |
Weighted Average Grant Date Fair Value Per Share, Outstanding ending balance | $ / shares | $ 18.66 |
Equity - Summary of Dividends D
Equity - Summary of Dividends Declared (Detail) - $ / shares | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | ||
Dividends Payable [Line Items] | |||
Dividend | $ 0.26 | $ 0.26 | |
Q1 2019 | |||
Dividends Payable [Line Items] | |||
Declaration Date | May 2, 2019 | ||
Record Date | Jun. 10, 2019 | ||
Pay Date | Jun. 27, 2019 | ||
Dividend | [1] | $ 0.26 | |
[1] | Prior to the end of the performance period as set forth in the applicable LTIP unit award, holders of LTIP units are entitled to receive dividends per LTIP unit equal to 10% of the dividend paid per common unit. After the end of the performance period, the number of LTIP units, both vested and unvested, that LTIP award recipients have earned, if any, are entitled to receive dividends in an amount per LTIP unit equal to dividends, both regular and special, payable per common unit. |
Equity - Summary of Dividends_2
Equity - Summary of Dividends Declared (Parenthetical) (Detail) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Operating partnership dividend rate percentage | 10.00% |
Equity - Schedule of Informatio
Equity - Schedule of Information with Respect to ATM Program (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Subsidiary Sale Of Stock [Line Items] | ||
Net Proceeds | $ 131,171 | $ 13,669 |
2017 ATM Program [Member] | ||
Subsidiary Sale Of Stock [Line Items] | ||
Number of Shares Sold | 366,455 | |
Net Proceeds | $ 6,504 |
Earnings Per Share - Summary of
Earnings Per Share - Summary of Basic and Diluted Earnings Per Common Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | ||
Earnings Per Share Basic And Diluted [Line Items] | |||
Net income (loss) | $ (481) | $ 1,815 | |
Less: Non-controlling interest in Operating Partnership | 65 | (296) | |
Net income (loss) available to Easterly Government Properties, Inc. | (416) | 1,519 | |
Less: Dividends on participating securities | (28) | (279) | |
Net income (loss) available to common stockholders | $ (444) | $ 1,240 | |
Denominator for basic EPS | 61,225,926 | 45,008,062 | |
Denominator for diluted EPS | 61,225,926 | 46,018,040 | |
Basic EPS | $ (0.01) | $ 0.03 | |
Diluted EPS | $ (0.01) | $ 0.03 | |
Stock Compensation Plan [Member] | |||
Earnings Per Share Basic And Diluted [Line Items] | |||
Dilutive effect | 12,803 | ||
Long Term Incentive Plan [Member] | |||
Earnings Per Share Basic And Diluted [Line Items] | |||
Dilutive effect | [1] | 997,175 | |
[1] | During the three months ended March 31, 2019, there were approximately 284,471 unvested performance-based LTIP units, 78,449 unvested restricted shares and 300,000 unsettled forward shares that were not included in the computation of diluted earnings per share because to do so would have been antidilutive for the period. |
Earnings Per Share - Summary _2
Earnings Per Share - Summary of Basic and Diluted Earnings Per Common Share (Parenthetical) (Detail) | 3 Months Ended |
Mar. 31, 2019shares | |
Unvested Performance-Based Long Term Incentive Plan [Member] | |
Earnings Per Share Basic And Diluted [Line Items] | |
Antidilutive securities excluded from computation of earnings per share amount | 284,471 |
Unvested Restricted Shares [Member] | |
Earnings Per Share Basic And Diluted [Line Items] | |
Antidilutive securities excluded from computation of earnings per share amount | 78,449 |
Unsettled Forward Shares [Member] | |
Earnings Per Share Basic And Diluted [Line Items] | |
Antidilutive securities excluded from computation of earnings per share amount | 300,000 |
Leases - Additional Information
Leases - Additional Information (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($)Agreement | |
Lessee Lease Description [Line Items] | |
Average age of property | 16 years |
Right-of-use asset | $ 1.2 |
Operating lease liability | $ 1.2 |
Number of lease agreement | Agreement | 2 |
Washington , D.C. [Member] | Sublease [Member] | |
Lessee Lease Description [Line Items] | |
Operating lease agreement expire date | Jun. 30, 2021 |
California [Member] | San Diego [Member] | |
Lessee Lease Description [Line Items] | |
Operating lease agreement expire date | Apr. 30, 2022 |
Leases - Summary of Maturity of
Leases - Summary of Maturity of Fixed Lease Payments Under Company's Leases (Detail) $ in Thousands | Mar. 31, 2019USD ($) |
Leases [Abstract] | |
Fixed lease payments, Total | $ 1,301,581 |
Fixed lease payments, 2019 | 121,731 |
Fixed lease payments, 2020 | 149,508 |
Fixed lease payments, 2021 | 125,182 |
Fixed lease payments, 2022 | 107,914 |
Fixed lease payments, 2023 | 98,424 |
Fixed lease payments, Thereafter | $ 698,822 |
Leases - Summary of Future Non
Leases - Summary of Future Non Cancellable Minimum Contractual Rent Payments (Detail) $ in Thousands | Dec. 31, 2018USD ($) |
Leases [Abstract] | |
Minimum lease payments, Total | $ 1,251,546 |
Minimum lease payments, 2019 | 151,152 |
Minimum lease payments, 2020 | 139,315 |
Minimum lease payments, 2021 | 116,827 |
Minimum lease payments, 2022 | 99,822 |
Minimum lease payments, 2023 | 92,392 |
Minimum lease payments, Thereafter | $ 652,038 |
Leases - Schedule of Quantitati
Leases - Schedule of Quantitative Information for Company's Operating Leases (Detail) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Leases [Abstract] | |
Operating leases costs | $ 1,275 |
Weighted average remaining lease terms (in years) | 2 years 7 months 17 days |
Weighted average discount rate | 3.84% |
Leases - Schedule of Maturity o
Leases - Schedule of Maturity of Fixed Lease Payments Under Company's Corporate Office Leases (Detail) - Corporate Office Leases [Member] $ in Thousands | Mar. 31, 2019USD ($) |
Schedule Of Future Minimum Rental Payments For Operating Leases [Line Items] | |
Fixed lease payments, Total | $ 1,275 |
Fixed lease payments, 2019 | 362 |
Fixed lease payments, 2020 | 496 |
Fixed lease payments, 2021 | 352 |
Fixed lease payments, 2022 | $ 65 |
Leases - Summary of Future Mini
Leases - Summary of Future Minimum Rental Payments Under Company's Corporate Office Leases (Detail) $ in Thousands | Dec. 31, 2018USD ($) |
Schedule Of Future Minimum Rental Payments For Operating Leases [Line Items] | |
Minimum lease payments, Total | $ 1,251,546 |
Minimum lease payments, 2019 | 151,152 |
Minimum lease payments, 2020 | 139,315 |
Minimum lease payments, 2021 | 116,827 |
Minimum lease payments, 2022 | 99,822 |
Minimum lease payments, 2023 | 92,392 |
Minimum lease payments, Thereafter | 652,038 |
Corporate Office Leases [Member] | |
Schedule Of Future Minimum Rental Payments For Operating Leases [Line Items] | |
Minimum lease payments, Total | 1,392 |
Minimum lease payments, 2019 | 479 |
Minimum lease payments, 2020 | 496 |
Minimum lease payments, 2021 | 352 |
Minimum lease payments, 2022 | $ 65 |
Revenue - Summary of Revenue fr
Revenue - Summary of Revenue from Tenant Construction Projects Disaggregated by Tenant Agency (Detail) - ASU 2014-09 [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Disaggregation Of Revenue [Line Items] | ||
Tenant Construction Project Income | $ 1,814 | $ 1,043 |
'Federal Bureau of Investigation ("FBI") [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Tenant Construction Project Income | 1,119 | 58 |
Department of Veteran Affairs (“VA”) [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Tenant Construction Project Income | 450 | 787 |
Drug Enforcement Administration (“DEA”) [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Tenant Construction Project Income | 127 | 23 |
Food And Drug Administration ("FDA") [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Tenant Construction Project Income | 77 | |
U.S. Forest Service ("USFS") [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Tenant Construction Project Income | 16 | 29 |
U.S. Citizenship and Immigration Services (“USCIS”) [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Tenant Construction Project Income | 14 | |
Internal Revenue Service ("IRS") [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Tenant Construction Project Income | 6 | |
The Judiciary of the U.S. Government ("JUD") [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Tenant Construction Project Income | 4 | 100 |
Social Security Administration ("SSA") [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Tenant Construction Project Income | $ 1 | |
U.S. Coast Guard ("USCG") [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Tenant Construction Project Income | 6 | |
Immigration and Customs Enforcement ("ICE") [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Tenant Construction Project Income | 9 | |
National Park Service ("NPS") [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Tenant Construction Project Income | $ 31 |
Revenue - Additional Informatio
Revenue - Additional Information (Detail) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Revenue Initial Application Period Cumulative Effect Transition [Line Items] | |||
Accounts receivable | $ 13,650,000 | $ 11,690,000 | |
ASU 2014-09 [Member] | |||
Revenue Initial Application Period Cumulative Effect Transition [Line Items] | |||
Accounts receivable related to tenant construction projects | 3,400,000 | 2,400,000 | |
Contract assets | 0 | 0 | |
Contract liabilities | 0 | 0 | |
ASU 2014-09 [Member] | Energy Credit Income [Member] | Maximum [Member] | |||
Revenue Initial Application Period Cumulative Effect Transition [Line Items] | |||
Parking garage and energy credit income | 100,000 | $ 100,000 | |
ASU 2014-09 [Member] | Various GSA – Buffalo Property [Member] | Parking Garage [Member] | |||
Revenue Initial Application Period Cumulative Effect Transition [Line Items] | |||
Parking garage and energy credit income | 200,000 | $ 0 | |
Accounts receivable | $ 100,000 | ||
ASU 2014-09 [Member] | Various GSA – Buffalo Property [Member] | Parking Garage [Member] | Maximum [Member] | |||
Revenue Initial Application Period Cumulative Effect Transition [Line Items] | |||
Accounts receivable | $ 100,000 |
Concentrations Risk - Additiona
Concentrations Risk - Additional Information (Detail) | 3 Months Ended |
Mar. 31, 2019Property | |
Wholly Owned Properties [Member] | |
Concentration Risk [Line Items] | |
Number of properties | 65 |
California [Member] | |
Concentration Risk [Line Items] | |
Number of properties | 17 |
California [Member] | Properties Under Development [Member] | |
Concentration Risk [Line Items] | |
Number of properties | 1 |
Lease Income [Member] | Credit Concentration Risk [Member] | California [Member] | |
Concentration Risk [Line Items] | |
Percentage of concentrations risk | 28.20% |
Rentable Square Feet [Member] | Credit Concentration Risk [Member] | California [Member] | |
Concentration Risk [Line Items] | |
Percentage of concentrations risk | 22.30% |
U.S. Government [Member] | Lease Income [Member] | Credit Concentration Risk [Member] | |
Concentration Risk [Line Items] | |
Percentage of concentrations risk | 98.20% |
Non Governmental Tenants [Member] | Lease Income [Member] | Credit Concentration Risk [Member] | |
Concentration Risk [Line Items] | |
Percentage of concentrations risk | 1.80% |