Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2017 | Aug. 10, 2017 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | JBG SMITH PROPERTIES | |
Entity Central Index Key | 1,689,796 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 118,200,851 |
Condensed Combined Balance Shee
Condensed Combined Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Real estate, at cost: | ||
Land and improvements | $ 930,001 | $ 939,592 |
Buildings and improvements | 3,028,517 | 3,064,466 |
Construction in progress | 212,795 | 151,333 |
Real Estate Investment Property, at Cost | 4,171,313 | 4,155,391 |
Less accumulated depreciation | (959,352) | (930,769) |
Real estate, net | 3,211,961 | 3,224,622 |
Cash and cash equivalents | 280,613 | 29,000 |
Restricted cash | 3,735 | 3,263 |
Tenant and other receivables, net | 28,232 | 33,380 |
Deferred rent receivable, net | 143,395 | 136,582 |
Investments in unconsolidated real estate ventures | 45,476 | 45,776 |
Receivable from Vornado Realty Trust | 76,738 | 75,062 |
Other assets, net | 119,795 | 112,955 |
TOTAL ASSETS | 3,909,945 | 3,660,640 |
Liabilities: | ||
Mortgages payable, net | 1,376,077 | 1,165,014 |
Payable to Vornado Realty Trust | 289,904 | 283,232 |
Accounts payable and accrued expenses | 31,779 | 40,923 |
Other liabilities, net | 50,045 | 49,487 |
Total liabilities | 1,747,805 | 1,538,656 |
Commitments and Contingencies | ||
Equity: | ||
Parent equity | 2,161,845 | 2,121,689 |
Noncontrolling interests | 295 | 295 |
Total equity | 2,162,140 | 2,121,984 |
TOTAL LIABILITIES AND EQUITY | $ 3,909,945 | $ 3,660,640 |
Condensed Combined Statements o
Condensed Combined Statements of Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
REVENUE | ||||
Property rentals | $ 100,747 | $ 98,861 | $ 199,771 | $ 196,232 |
Tenant reimbursements | 9,030 | 8,716 | 17,667 | 18,197 |
Third-party real estate services | 4,869 | 5,767 | 9,923 | 12,301 |
Other income | 3,374 | 2,995 | 6,931 | 6,393 |
Total revenue | 118,020 | 116,339 | 234,292 | 233,123 |
EXPENSES | ||||
Depreciation and amortization | 31,993 | 32,625 | 65,775 | 66,914 |
Property operating | 28,285 | 27,374 | 56,466 | 56,460 |
Real estate taxes | 15,582 | 14,137 | 30,754 | 29,250 |
General and administrative | 11,708 | 11,939 | 25,398 | 25,960 |
Transaction and other costs | 5,237 | 0 | 11,078 | 0 |
Total operating expenses | 92,805 | 86,075 | 189,471 | 178,584 |
OPERATING INCOME | 25,215 | 30,264 | 44,821 | 54,539 |
Income (loss) from unconsolidated real estate ventures | 105 | (374) | 314 | (1,536) |
Interest and other income, net | 970 | 760 | 1,745 | 1,543 |
Interest expense | (14,586) | (13,549) | (28,504) | (25,634) |
INCOME BEFORE INCOME TAX EXPENSE | 11,704 | 17,101 | 18,376 | 28,912 |
Income tax expense | (363) | (318) | (717) | (582) |
NET INCOME ATTRIBUTABLE TO JBG SMITH PROPERTIES | $ 11,341 | $ 16,783 | $ 17,659 | $ 28,330 |
Condensed Combined Statement of
Condensed Combined Statement of Equity - 6 months ended Jun. 30, 2017 - USD ($) $ in Thousands | Total | Parent Equity | Noncontrolling Interests |
BALANCE (beginning of period) at Dec. 31, 2016 | $ 2,121,984 | $ 2,121,689 | $ 295 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||
Net income attributable to JBG SMITH Properties | 17,659 | 17,659 | |
Deferred compensation shares and options, net | 1,294 | 1,294 | |
Contributions from Vornado Realty Trust, net | 21,203 | 21,203 | |
BALANCE, (end of period) at Jun. 30, 2017 | $ 2,162,140 | $ 2,161,845 | $ 295 |
Condensed Combined Statements 5
Condensed Combined Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
OPERATING ACTIVITIES: | ||
Net income attributable to JBG SMITH Properties | $ 17,659 | $ 28,330 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization, including amortization of debt issuance costs | 66,563 | 67,806 |
Straight-line rent | (6,829) | (5,461) |
Equity in (income) loss of unconsolidated real estate ventures | (314) | 1,536 |
Accretion of below-market lease intangibles, net | (687) | (673) |
Operating distributions from unconsolidated real estate ventures | 628 | 777 |
Other non-cash adjustments | 4,408 | 5,399 |
Changes in operating assets and liabilities: | ||
Tenant and other receivables | 4,472 | 134 |
Other assets, net | (14,868) | (7,214) |
Accounts payable and accrued expenses | 359 | 6,122 |
Other liabilities, net | 1,267 | (5,836) |
Net cash provided by operating activities | 72,658 | 90,920 |
INVESTING ACTIVITIES: | ||
Development costs, construction in progress and real estate additions | (54,747) | (123,519) |
Restricted cash | (472) | 272 |
Other investments | (1,396) | (1,529) |
Investments in unconsolidated real estate ventures | (14) | (19,965) |
Net cash used in investing activities | (56,629) | (144,741) |
FINANCING ACTIVITIES: | ||
Contributions from Vornado Realty Trust, net | 21,203 | 1,487 |
Proceeds from borrowings from Vornado Realty Trust | 4,000 | 28,500 |
Repayments of borrowings | (6,689) | (4,858) |
Distributions to noncontrolling interests | 0 | (7) |
Debt issuance costs | (2,930) | (4) |
Proceeds from borrowings | 220,000 | 0 |
Net cash provided by financing activities | 235,584 | 25,118 |
Net increase (decrease) in cash and cash equivalents | 251,613 | (28,703) |
Cash and cash equivalents at beginning of the period | 29,000 | 74,966 |
Cash and cash equivalents at end of the period | 280,613 | 46,263 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW AND NON-CASH INFORMATION: | ||
Transfer of mortgage payable to Vornado Realty Trust | 0 | 115,022 |
Cash paid for interest (net of capitalized interest of $917 and $2,761 in 2017 and 2016, respectively) | 22,719 | 19,907 |
Accrued capital expenditures included in accounts payable and accrued expenses | 1,475 | 44,754 |
Write-off of fully depreciated assets | (12,946) | (43,027) |
Cash payments for income taxes | $ 706 | $ 762 |
Condensed Combined Statements 6
Condensed Combined Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Statement of Cash Flows [Abstract] | ||
Capitalized interest | $ 917 | $ 2,761 |
Organization and Basis of Prese
Organization and Basis of Presentation and Combination | 6 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation and Combination | Organization and Basis of Presentation and Combination Organization JBG SMITH Properties (“JBG SMITH”) (NYSE: JBGS) was organized by Vornado Realty Trust (NYSE: VNO) (“Vornado”) as a Maryland real estate investment trust (“REIT”) on October 27, 2016 (capitalized on November 22, 2016). JBG SMITH was formed for the purpose of receiving, via the spin-off on July 17, 2017 (the “Separation”), substantially all of the assets and liabilities of Vornado’s Washington, DC segment, which operated as Vornado / Charles E. Smith, (the “Vornado Included Assets”). On July 18, 2017, JBG SMITH acquired the management business and certain assets of The JBG Companies (“JBG”) (the “Combination”). Unless the context otherwise requires, all references to “we,” “us,” and “our,” refer to JBG SMITH after giving effect to the transfer of assets and liabilities from Vornado, but prior to the date of completion of the Separation. Prior to the Separation from Vornado, JBG SMITH was a wholly owned subsidiary of Vornado and had no material assets or operations. Pursuant to a separation agreement, on July 17, 2017, Vornado distributed 100% of the then outstanding common shares of JBG SMITH on a pro rata basis to the holders of its common shares. Prior to such distribution by Vornado, Vornado Realty L.P. (“VRLP”), Vornado's operating partnership, distributed JBG SMITH LP, our operating partnership, common limited partnership units on a pro rata basis to the holders of its common limited partnership units, consisting of Vornado and the other common limited partners of VRLP. Following such distribution by VRLP and prior to such distribution by Vornado, Vornado contributed to JBG SMITH all of the JBG SMITH LP common limited partnership units it received in exchange for common shares of JBG SMITH. Each Vornado common shareholder received one JBG SMITH common share for every two Vornado common shares held as of the close of business on July 7, 2017 (the “Record Date”). Vornado and each of the other limited partners of VRLP received one JBG SMITH LP common limited partnership unit for every two common limited partnership units in VRLP held as of the close of business on the Record Date. The operations of JBG SMITH are presented as if the transfer of the Vornado Included Assets had been consummated prior to all historical periods presented in the accompanying condensed combined financial statements at the carrying amounts of such assets and liabilities reflected in Vornado’s books and records. In connection with the Separation, JBG SMITH issued 94.7 million common shares and JBG SMITH LP issued 5.8 million common limited partnership units to parties other than JBG SMITH. In connection with the Combination, JBG SMITH issued 23.5 million common shares and JBG SMITH LP issued 13.7 million common limited partnership units to parties other than JBG SMITH. As of the completion of the Separation and the Combination there were 118.2 million JBG SMITH common shares outstanding and 19.5 million JBG SMITH LP common limited partnership units outstanding that were owned by parties other than JBG SMITH. After the Combination on July 18, 2017, the combined portfolio of JBG SMITH was comprised of: (i) 68 operating assets comprising 50 office assets totaling over 13.9 million square feet ( 11.9 million square feet at our share), 14 multifamily assets totaling 6,016 units ( 4,232 units at our share) and four other assets totaling approximately 765,000 square feet ( 348,000 square feet at our share); (ii) 11 assets under construction comprising five office assets totaling over 1.3 million square feet ( 1.2 million square feet at our share) and six multifamily assets totaling 1,334 units ( 1,146 units at our share); (iii) two near-term development assets comprising one other asset of approximately 65,000 square feet ( 6,500 square feet at our share) and one multifamily asset totaling 433 units ( 303 units at our share), and (iv) 44 future development assets totaling over 22 million square feet ( 18.3 million square feet at our share) of estimated potential development density. Our revenues are derived primarily from leases with office and multifamily tenants, including fixed rents and reimbursements from tenants for certain expenses such as real estate taxes, property operating expenses, and repairs and maintenance. Only the U.S. federal government accounted for 10% or more of revenue for the three and six months ended June 30, 2017 and 2016 , as follows: Three Months Ended June 30, Six Months Ended June 30, (Dollars in thousands) 2017 2016 2017 2016 U.S. federal government $ 23,168 $ 23,326 $ 46,377 $ 47,345 Percentage of office segment revenue 26.74 % 26.03 % 26.80 % 26.26 % Percentage of total revenue 19.63 % 20.05 % 19.79 % 20.31 % Basis of Presentation and Combination The accompanying condensed combined financial statements include the Vornado Included Assets, all of which were under common control of Vornado for all periods prior to the July 17, 2017 transfer of assets to JBG SMITH and the distribution of JBG SMITH’s common shares to Vornado’s shareholders. The assets and liabilities in these combined financial statements have been carved out of Vornado’s books and records at their historical carrying amounts. All significant intercompany transactions and balances have been eliminated. Our condensed combined financial statements covered in this report present the financial condition as of and for the three- and six-month periods ended June 30, 2017 , which is prior to consummation of the Separation and the Combination. Therefore, the discussion of our results of operations, cash flows and financial condition set forth in this report is not necessarily indicative of our future results of operations, cash flows or financial condition as an independent, publicly traded company. The historical financial results for the Vornado Included Assets reflect charges for certain corporate costs which we believe are reasonable. These charges were based on either actual costs incurred or a proportion of costs estimated to be applicable to the Vornado Included Assets based on an analysis of key metrics, including total revenues. Such costs do not necessarily reflect what the actual costs would have been if JBG SMITH had been operating as a separate standalone public company. These charges are discussed further in Note 11. Presentation of earnings per share information is not applicable in these condensed combined financial statements, since these assets and liabilities were owned by Vornado during the periods presented. The condensed combined financial statements included in this report are unaudited. In our opinion, all adjustments considered necessary for a fair presentation have been included, and all such adjustments are of a normal recurring nature. The results of operations for the three and six months ended June 30, 2017 and 2016 are not necessarily indicative of the results that may be expected for a full year. The accompanying unaudited condensed combined financial statements and notes are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions of Form 10-Q. Accordingly, these unaudited condensed combined financial statements do not contain certain information required in annual financial statements and notes. The unaudited condensed combined balance sheet as of December 31, 2016 was derived from audited financial statements, but does not include all disclosures required under GAAP. These condensed combined financial statements should be read in conjunction with our Registration Statement on Form 10, as amended, filed with the Securities and Exchange Commission (the “SEC”) and declared effective on June 26, 2017 as well as the final Information Statement filed with the SEC as Exhibit 99.1 to our Current Report on Form 8-K filed on June 27, 2017. Commencing with the transfer of assets to JBG SMITH and the distribution of JBG SMITH’s common shares to Vornado’s shareholders, JBG SMITH operates in a manner intended to enable it to qualify as a REIT under Sections 856‑860 of the Internal Revenue Code of 1986, as amended. Under those sections, a REIT which distributes at least 90% of its REIT taxable income as dividends to its shareholders each year and which meets certain other conditions will not be taxed on that portion of its taxable income which is distributed to its shareholders. Since Vornado operates as a REIT and distributes 100% of taxable income to its shareholders, no provision for federal income taxes has been made in the accompanying condensed combined financial statements. The Vornado Included Assets are subject to certain other taxes, including state and local taxes which are included in “income tax expense” in the condensed combined statements of income. The Vornado Included Assets aggregate assets into two reportable segments (office and multifamily) because all of the assets in each segment have similar economic characteristics and we provide similar products and services to similar types of office and multifamily tenants. Certain prior period data have been reclassified to conform to the current period presentation. We reclassified $4.0 million of investments to “Other assets” on our condensed combined balance sheet as of December 31, 2016 as a result of the revision in the line item “Investments in unconsolidated real estate ventures” on our condensed combined balance sheet to include only real estate investments. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Recent Accounting Pronouncements The following table provides a brief description of recent accounting pronouncements (Accounting Standards Update or “ASU”) by the Financial Accounting Standards Board (“FASB”) that could have a material effect on our financial statements: Standard Description Date of Adoption Effect on the Financial Statements or Other Significant Matters Standards not yet adopted ASU 2017‑09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting This standard clarifies which changes to the terms or conditions of a share-based payment award are subject to the guidance on modification accounting under FASB Accounting Standards Codification (“ASC”) Topic 718. Entities would apply the modification accounting guidance unless the value, vesting requirements and classification of a share-based payment award are the same immediately before and after a change to the terms or conditions of the award. January 2018 We are currently evaluating the overall impact of the adoption of ASU 2017-09. The adoption of this standard is not expected to have a material impact on our combined financial statements. ASU 2017‑05, Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets This standard clarifies the scope of recently established guidance on nonfinancial asset derecognition as well as the accounting for partial sales of nonfinancial assets. This update conforms the derecognition guidance on nonfinancial assets with the model for transactions in ASC 606. January 2018 The adoption of this standard is not expected to have an impact on our combined financial statements. ASU 2017‑01 Business Combinations (Topic 805): Clarifying the Definition of a Business This standard provides a screen to determine when an asset acquired or group of assets acquired is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. This screen reduces the number of transactions that need to be further evaluated. January 2018 The adoption of this standard will result in fewer real estate acquisitions qualifying as businesses and, accordingly, acquisition costs for those acquisitions that are not businesses will be capitalized rather than expensed. ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments and ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash These standards amend the existing guidance and address specific cash flow issues with the objective of reducing existing diversity in practice. ASU 2016-15 addresses eight specific cash flow issues and ASU 2016-18 specifically addresses presentation of restricted cash and restricted cash equivalents in the statements of cash flows. These standards require a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, entities may apply the amendments prospectively as of the earliest date practicable. January 2018 Other than the revised statement of cash flows presentation of restricted cash, the adoption of these standards is not expected to have a material impact on our combined financial statements. Standard Description Date of Adoption Effect on the Financial Statements or Other Significant Matters ASU 2016-02, Leases (Topic 842) This standard sets out the principles for the recognition, measurement, presentation and disclosure of leases for both lessees and lessors. ASU 2016-02 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. Lessees are required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. Lessees will recognize expense based on the effective interest method for finance leases or on a straight-line basis for operating leases. January 2019 We are currently evaluating the overall impact of the adoption of ASU 2016-02 on our combined financial statements, including the timing of adopting this standard. ASU 2016-02 will more significantly impact the accounting for leases in which we are the lessee. We have ground leases for which we will be required to record a right-of-use asset and lease liability equal to the present value of the remaining minimum lease payments upon adoption of this standard. We also expect that this standard will have an impact on the presentation of certain lease and non‑lease components of revenue from leases with no material impact to “total revenues.” ASU 2014-09, Revenue from Contracts with Customers (Topic 606), as clarified and amended by ASU 2016-08, ASU 2016-10 and ASU 2016-12 This standard establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. It requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. This standard may be adopted either retrospectively or on a modified retrospective basis. January 2018 We currently expect to utilize the modified retrospective method of adoption. We have commenced the execution of our project plan for adopting this standard, which consists of gathering and evaluating the inventory of our revenue streams. We expect this standard will have an impact on the presentation of certain lease and non-lease components of revenue from leases upon the adoption of ASU 2016‑02, Leases, with no material impact on “total revenues.” We expect this standard will have an impact on the timing of gains on certain sales of real estate. We are continuing to evaluate the impact of this standard on our combined financial statements. |
Investments in Unconsolidated R
Investments in Unconsolidated Real Estate Ventures | 6 Months Ended |
Jun. 30, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments in Unconsolidated Real Estate Ventures | Investments in Unconsolidated Real Estate Ventures The following is a summary of the composition of our investments in unconsolidated real estate ventures as of June 30, 2017 and December 31, 2016 : Ownership Interest Investment Balance Investments June 30, June 30, December 31, (In thousands) The Warner 55.0% $ 38,823 $ 39,417 Other investments Various 6,653 6,359 Total investments in unconsolidated real estate ventures $ 45,476 $ 45,776 The following is a summary of the debt of our unconsolidated real estate ventures as of June 30, 2017 and December 31, 2016 : Interest Rate 100% Unconsolidated Real Estate Ventures' Debt Investments Maturity June 30, June 30, December 31, (In thousands) The Warner 06/01/23 3.65% $ 273,000 $ 273,000 1101 17 th Street 01/19/18 (1) 2.47% 31,000 31,000 Unconsolidated real estate ventures - mortgages payable 304,000 304,000 Unamortized deferred financing costs, net (918 ) (1,034 ) Unconsolidated real estate ventures - mortgages payable, net $ 303,082 $ 302,966 ____________________ (1) In January 2017, the 1101 17 th Street mortgage was extended from January 2017 to January 2018. The following is a summary of the condensed combined financial information for all of our unconsolidated real estate ventures, as of June 30, 2017 and December 31, 2016 and for the three and six months ended June 30, 2017 and 2016 : June 30, December 31, 2016 Balance sheet information: (In thousands) Total assets $ 606,293 $ 598,239 Total liabilities $ 334,092 $ 327,862 Noncontrolling interests $ 343 $ 343 Total equity $ 271,858 $ 270,034 Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 Income statement information: (In thousands) Total revenue $ 18,318 $ 17,379 $ 36,557 $ 34,702 Net income $ 3,570 $ 2,298 $ 5,993 $ 2,476 |
Variable Interest Entities
Variable Interest Entities | 6 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | Variable Interest Entities As of June 30, 2017 and December 31, 2016 , we have several unconsolidated variable interest entities. We do not consolidate these entities because we are not the primary beneficiary and the nature of our involvement in the activities of these entities does not give us power over decisions that significantly affect these entities’ economic performance. We account for our investment in these entities under the equity method. As of June 30, 2017 and December 31, 2016 , the net carrying amounts of our investment in these entities were $43.2 million and $42.4 million , respectively, and our maximum exposure to loss in these entities is limited to our investments. |
Other Assets, Net
Other Assets, Net | 6 Months Ended |
Jun. 30, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets, Net | Other Assets, Net The following is a summary of other assets, net as of June 30, 2017 and December 31, 2016 : June 30, December 31, (In thousands) Deferred leasing costs, gross $ 166,689 $ 157,258 Accumulated amortization (63,442 ) (57,910 ) Deferred leasing costs, net 103,247 99,348 Prepaid expenses 4,111 2,199 Identified intangible assets, net 2,739 3,063 Other 9,698 8,345 Total other assets, net $ 119,795 $ 112,955 |
Mortgages Payable
Mortgages Payable | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Mortgages Payable | Mortgages Payable The following is a summary of mortgages payable as of June 30, 2017 and December 31, 2016 : Interest Rate Balance as of June 30, June 30, December 31, (In thousands) Variable rate (1) 2.77% $ 767,291 $ 547,291 Fixed rate 5.52% 613,637 620,327 Mortgages payable 1,380,928 1,167,618 Unamortized deferred financing costs and premium/discount, net (4,851 ) (2,604 ) Mortgages payable, net $ 1,376,077 $ 1,165,014 Payable to Vornado Realty Trust (2) 3.70% $ 289,904 $ 283,232 __________________________ (1) On June 20, 2017, we completed a $220.0 million financing of The Bartlett, a 699 -unit residential building in Arlington, Virginia. The five -year interest-only mortgage loan bears interest at LIBOR plus 1.70% per annum and matures in June 2022. We realized net proceeds of approximately $217.2 million . (2) In June 2016, the mortgage loan for the Bowen Building was repaid with proceeds of a $115.6 million draw on Vornado’s revolving credit facility collateralized by an interest in the property, and, accordingly, has been reflected as a component of “Payable to Vornado Realty Trust” on the combined balance sheets as of June 30, 2017 and December 31, 2016 . The mortgage was assigned to JBG SMITH at Separation, and the note was repaid with amounts drawn under the revolving credit facility (see Note 12 for further discussion). |
Other Liabilities, Net
Other Liabilities, Net | 6 Months Ended |
Jun. 30, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities, Net | Other Liabilities, Net The following is a summary of other liabilities, net as of June 30, 2017 and December 31, 2016 : June 30, December 31, (In thousands) Prepaid rent $ 13,762 $ 9,163 Lease assumptions liabilities and accrued tenant incentives 11,792 14,907 Lease intangible liabilities, net 10,862 11,570 Security deposits 10,316 10,324 Ground lease deferred rent payable 3,313 3,331 Other — 192 Total other liabilities, net $ 50,045 $ 49,487 |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements ASC 820 , Fair Value Measurement and Disclosures , defines fair value and establishes a framework for measuring fair value. The objective of fair value is to determine the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (the exit price). ASC 820 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three levels: Level 1 — quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities; Level 2 — observable prices that are based on inputs not quoted in active markets, but corroborated by market data; and Level 3 — unobservable inputs that are used when little or no market data is available. The fair value hierarchy gives the highest priority to Level 1 inputs and the lowest priority to Level 3 inputs. In determining fair value, we utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as consider counterparty credit risk in our assessment of fair value. Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis There were no financial assets or liabilities measured at fair value on a recurring basis as of June 30, 2017 and December 31, 2016 . Financial Assets and Liabilities Not Measured at Fair Value As of June 30, 2017 and December 31, 2016 , all financial instruments and liabilities were reflected in our condensed combined balance sheets at amounts which, in our estimation, reasonably approximated their fair values, except for the following: June 30, 2017 December 31, 2016 Carrying Amount (1) Fair Value Carrying Amount (1) Fair Value (In thousands) Financial liabilities: Mortgages payable $ 1,380,928 $ 1,411,419 $ 1,167,618 $ 1,192,267 ______________________________________ ( 1) The carrying amount consists of principal only. The fair value of our mortgages payable is estimated by discounting the future contractual cash flows of these instruments using current risk-adjusted rates available to borrowers with similar credit ratings, which are provided by a third-party specialist. The fair value of the mortgages payable was determined using Level 2 inputs of the fair value hierarchy. |
Segment Information
Segment Information | 6 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Below is a summary of net income by segment for the three and six months ended June 30, 2017 and 2016 : Three Months Ended June 30, 2017 Office Multifamily Other Total (In thousands) Total revenue $ 86,631 $ 21,698 $ 9,691 $ 118,020 Operating expenses 57,639 13,083 16,846 87,568 Transaction and other costs — — 5,237 5,237 Total operating expenses 57,639 13,083 22,083 92,805 Operating income (loss) 28,992 8,615 (12,392 ) 25,215 Income from unconsolidated 105 — — 105 Interest and other income, net 857 7 106 970 Interest expense (10,476 ) (4,117 ) 7 (14,586 ) Income (loss) before income tax expense 19,478 4,505 (12,279 ) 11,704 Income tax expense (37 ) — (326 ) (363 ) Net income (loss) attributable to JBG SMITH Properties $ 19,441 $ 4,505 $ (12,605 ) $ 11,341 Three Months Ended June 30, 2016 Office Multifamily Other Total (In thousands) Total revenue $ 89,612 $ 16,319 $ 10,408 $ 116,339 Total operating expenses 58,964 10,594 16,517 86,075 Operating income (loss) 30,648 5,725 (6,109 ) 30,264 Loss from unconsolidated (374 ) — — (374 ) Interest and other income, net 759 — 1 760 Interest expense (10,505 ) (3,097 ) 53 (13,549 ) Income (loss) before income tax expense 20,528 2,628 (6,055 ) 17,101 Income tax expense (81 ) — (237 ) (318 ) Net income (loss) attributable to JBG SMITH Properties $ 20,447 $ 2,628 $ (6,292 ) $ 16,783 Six Months Ended June 30, 2017 Office Multifamily Other Total (In thousands) Total revenue $ 173,044 $ 42,473 $ 18,775 $ 234,292 Operating expenses 116,128 26,476 35,789 178,393 Transaction and other costs — — 11,078 11,078 Total operating expenses 116,128 26,476 46,867 189,471 Operating income (loss) 56,916 15,997 (28,092 ) 44,821 Income from unconsolidated 314 — — 314 Interest and other income, net 1,723 7 15 1,745 Interest expense (20,783 ) (7,780 ) 59 (28,504 ) Income (loss) before income tax expense 38,170 8,224 (28,018 ) 18,376 Income tax expense (68 ) — (649 ) (717 ) Net income (loss) attributable to JBG SMITH Properties $ 38,102 $ 8,224 $ (28,667 ) $ 17,659 Six Months Ended June 30, 2016 Office Multifamily Other Total (In thousands) Total revenue $ 180,296 $ 31,825 $ 21,002 $ 233,123 Total operating expenses 123,116 19,541 35,927 178,584 Operating income (loss) 57,180 12,284 (14,925 ) 54,539 Loss from unconsolidated (1,536 ) — — (1,536 ) Interest and other income, net 1,540 — 3 1,543 Interest expense (21,517 ) (4,283 ) 166 (25,634 ) Income (loss) before income tax expense 35,667 8,001 (14,756 ) 28,912 Income tax expense (98 ) — (484 ) (582 ) Net income (loss) attributable to JBG SMITH Properties $ 35,569 $ 8,001 $ (15,240 ) $ 28,330 The following is a summary of certain balance sheet data by segment as of June 30, 2017 and December 31, 2016 : Office Multifamily Other Total June 30, 2017 (In thousands) Real estate, at cost $ 2,935,001 $ 965,577 $ 270,735 $ 4,171,313 Investments in unconsolidated real estate ventures $ 45,333 $ — $ 143 $ 45,476 Total assets $ 2,527,891 $ 1,100,658 $ 281,396 $ 3,909,945 December 31, 2016 Real estate, at cost $ 2,929,976 $ 959,267 $ 266,148 $ 4,155,391 Investments in unconsolidated real $ 45,647 $ — $ 129 $ 45,776 Total assets $ 2,498,148 $ 872,838 $ 289,654 $ 3,660,640 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Environmental Matters Each of our properties has been subjected to varying degrees of environmental assessment at various times. The environmental assessments did not reveal any material environmental contamination that we believe would have a material adverse effect on our overall business, financial condition or results of operations. Nevertheless, there can be no assurance that the identification of new areas of contamination, changes in the extent or known scope of contamination, the discovery of additional sites or changes in cleanup requirements would not result in significant cost to us. Other There are various legal actions against us in the ordinary course of business. In our opinion, the outcome of such matters will not have a material adverse effect on our financial condition, results of operations or cash flows. As of June 30, 2017 , we expect to fund additional capital to certain of our unconsolidated investments totaling approximately $5.3 million . We are obligated under non-cancelable operating leases, primarily for ground leases on certain of our properties through 2084, totaling $576.1 million . |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions As described in Note 1, the accompanying condensed combined financial statements present the operations of the office and multifamily assets as carved-out from the financial statements of Vornado. Certain centralized corporate costs borne by Vornado for management and other services including, but not limited to, accounting, reporting, legal, tax, information technology and human resources have been allocated to the assets in the combined financial statements using reasonable allocation methodologies. The total amounts allocated during the three months ended June 30, 2017 and 2016 were $5.4 million and $4.6 million , respectively. The total amounts allocated during the six months ended June 30, 2017 and 2016 were $12.2 million and $10.7 million , respectively. These allocated amounts are included as a component of general and administrative expenses on the combined statements of income and do not necessarily reflect what actual costs would have been if the Vornado Included Assets were a separate standalone public company. Actual costs may be materially different. Allocated amounts for the three and six months ended June 30, 2017 and 2016 are not necessarily indicative of allocated amounts for a full year. In August 2014, we completed a $185.0 million financing of the Universal buildings, a 687,000 square foot office complex located in Washington, DC. In connection with this financing, pursuant to a note agreement dated August 12, 2014, we used a portion of the financing proceeds and made an $86.0 million loan to Vornado at LIBOR plus 2.9% ( 4.4% at June 30, 2017 ) due August 2019. During 2016 and 2015, Vornado repaid $4.0 million and $7.0 million of the loan receivable, respectively. As of June 30, 2017 and December 31, 2016 , the balance of the receivable from Vornado, including accrued interest, was $76.7 million and $75.1 million , respectively. We recognized interest income of $843,000 and $1.7 million during the three and six months ended June 30, 2017 , respectively, and $746,000 and $1.5 million during the three and six months ended June 30, 2016 , respectively. At the Separation, Vornado repaid the outstanding balance of the loan and related accrued interest. In connection with the development of The Bartlett, we entered into various note agreements with Vornado whereby we could borrow up to a maximum of $170.0 million . As of June 30, 2017 and December 31, 2016 , the amounts outstanding under these note agreements at LIBOR plus 2.9% ( 4.7% at June 30, 2017 ) were $174.3 million and $166.5 million , respectively, and are included in “Payable to Vornado Realty Trust” on our condensed combined balance sheets. We incurred interest of $2.0 million and $3.7 million during the three and six months ended June 30, 2017 , respectively, and $1.1 million and $1.8 million during the three and six months ended June 30, 2016 , respectively. Vornado contributed these note agreements to JBG SMITH at the Separation. In June 2016, the $115.0 million mortgage loan (including $608,000 of accrued interest) secured by the Bowen Building, a 231,000 square foot office building located in Washington, DC, was repaid with the proceeds of a $115.6 million draw on Vornado’s revolving credit facility. Given that the $115.6 million draw on Vornado’s credit facility is secured by an interest in the property, such amount is included in “Payable to Vornado Realty Trust” on our condensed combined balance sheets. We incurred interest expense of $625,000 and $1.2 million during the three and six months ended June 30, 2017 , respectively, and $145,000 for both the three and six months ended June 30, 2016 . The mortgage was assigned to JBG SMITH at the Separation, and the note was repaid with amounts drawn under our revolving credit facility. See Note 12 for further discussion. We have agreements with Building Maintenance Services (“BMS”), a wholly owned subsidiary of Vornado, to supervise cleaning, engineering and security services at our properties. We paid BMS $3.2 million and $6.3 million during the three and six months ended June 30, 2017 , respectively, and $3.2 million and $6.3 million during the three and six months ended June 30, 2016 , respectively, which are included in “Property operating expenses” on our condensed combined statements of income. In connection with the Separation and the Combination, we entered into an agreement with Vornado under which Vornado will provide operational support for an initial period of up to two years. See Note 12 for further discussion. We entered into a consulting agreement with Mr. Schear, a member of our Board of Trustees and formerly the president of Vornado’s Washington, DC segment. The consulting agreement, which expires on December 31, 2017, is subject to renewal through the second anniversary of the closing of the Combination unless earlier terminated and provides for the payment of consulting fees at the rate of $166,667 per month for the 24 months following the closing, including upon termination of the consulting agreement in certain circumstances by us, or after December 31, 2017 by him. In March 2017, Vornado amended Mr. Schear’s employment agreement with Vornado to provide for the payments that Mr. Schear will receive in connection with certain post-employment services related to the Separation which services are intended to facilitate the integration of the operations of Vornado’s Washington, DC segment with those of the management business and certain assets of JBG. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Pursuant to the Subsequent Events Topic of the Financial Accounting Standards Board ASC, we have evaluated subsequent events and transactions that occurred after our June 30, 2017 unaudited condensed combined balance sheet date for potential recognition or disclosure in our condensed combined financial statements and have also included such events in the footnotes herein. The Separation On July 17, 2017, we completed the Separation from Vornado. The Separation was effectuated by the distribution by Vornado of one common share of JBG SMITH for every two common shares of Vornado, and the distribution by VRLP of one common limited partnership unit of JBG SMITH LP for every two common limited partnership units of VRLP. A total of 94.7 million of our common shares and 5.8 million common limited partnership units of JBG SMITH LP were distributed to parties other than JBG SMITH. We are now an independent public company trading under the ticker symbol “JBGS” on the New York Stock Exchange. See Note 1 for further discussion. The Combination On July 18, 2017, we completed the Combination and acquired the management business and certain assets and liabilities, including mortgages payable with an aggregate principal balance of approximately $770.0 million , of The JBG Companies in exchange for 37.2 million common shares and common limited partnership units with a volume weighted average price on July 18, 2017 of $37.10 per share/unit. In accordance with ASC 805, Business Combinations, the Combination will be accounted for at fair value under the acquisition method of accounting. The purchase price allocation is in process and will be finalized after our valuation studies are complete. In addition, due to the short period of time between the closing of the Combination and the filing of this Quarterly Report on Form 10-Q, pro forma disclosures are not included and will be subsequently filed in an amended Current Report on Form 8-K, in accordance with SEC regulations. The JBG assets acquired comprise: (i) 30 operating assets comprising 19 office assets totaling approximately 3.6 million square feet ( 2.3 million square feet at our share), nine multifamily assets with 2,883 units ( 1,099 units at our share) and two other assets totaling approximately 490,000 square feet ( 73,000 square feet at our share); (ii) 11 office and multifamily assets under construction totaling over 2.5 million square feet ( 2.2 million square feet at our share); (iii) two near-term development office and multifamily assets totaling approximately 401,000 square feet ( 242,000 square feet at our share); (iv) 26 future development assets totaling approximately 11.7 million square feet ( 8.5 million square feet at our share) of estimated potential development density; and (v) JBG/Operating Partners, L.P., a real estate services company providing investment, development, asset management, property management, leasing, construction management and other services. JBG/Operating Partners, L.P. was owned by 20 unrelated individuals of which 19 became our employees, and three of these former owners serve on our Board of Trustees. Acquisition-related transaction costs and costs to effect the Separation and the Combination (such as advisory, legal, accounting, valuation and other professional fees) will not be included as a component of acquisition consideration. Such costs are expensed in the periods incurred. In connection with the Separation and the Combination, we entered into an agreement with Vornado under which Vornado will provide operational support for an initial period of up to two years. These services include information technology, financial reporting and payroll services. The charges for these services will be based on an hourly or per transaction fee arrangement including reimbursement for overhead and out-of-pocket expenses. Pursuant to an agreement, we are providing Vornado with leasing and property management services for certain of its assets held under joint venture arrangements that were not part of the Separation. We believe that the terms of both of these agreements are comparable to those that would have been negotiated on an arm’s-length basis. Other Events JBG SMITH 2017 Omnibus Share Plan On June 23, 2017, our Board of Trustees adopted the JBG SMITH 2017 Omnibus Share Plan (the “Plan”), effective as of July 17, 2017, and authorized the reservation of approximately 10.3 million of our common shares pursuant to the Plan. On July 10, 2017, our sole shareholder approved the Plan. Initial Formation Awards Pursuant to the Plan, on July 18, 2017, we granted approximately 2.7 million initial formation awards based on an aggregate notional value of approximately $100.0 million divided by the volume-weighted average price on July 18, 2017 of $37.10 per common share. The initial formation awards are structured in the form of profits interests that provide for a share of appreciation determined by the increase in the value of a common share at the time of conversion over the $37.10 volume-weighted average price of a common share at the time the formation unit was granted. The initial formation awards, subject to certain conditions, will vest 25% on each of the third and fourth anniversaries, and 50% on the fifth anniversary, of the closing of the Combination, subject to continued employment with JBG SMITH through each vesting date. 2017 Equity Grants On July 18, 2017, we granted long-term incentive partnership units (“LTIP Units”) to the seven independent Trustees in the amount of $250,000 each. The LTIP Units fully vested on the date of grant, but may not be sold while an independent Trustee is serving on the Board. On August 1, 2017, we granted approximately 303,700 LTIP Units to management and other employees under our Plan. The LTIP units vest in four equal installments on July 18 of each year, subject to continued employment. On August 1, 2017, we granted approximately 607,000 out-performance award units (“OPP Units”) to management and other employees under the Plan. OPP Units are part of a performance-based equity compensation plan pursuant to which participants have the opportunity to earn OPP units based on the relative performance of the total shareholder return (“TSR”) of our common shares compared to the companies in the FTSE NAREIT Equity Office Index, over the three -year performance period beginning on the August 1, 2017 grant date, inclusive of dividends and stock price appreciation. 50% of any OPP Units that are earned vest at the end of the three -year performance period and the remaining 50% on the fourth anniversary of the date of grant, subject to continued employment. Credit Facility On July 18, 2017, we entered into a $1.4 billion credit facility, consisting of a $1.0 billion revolving credit facility with a four -year term, with two six -month extension options, a five and a half-year delayed draw $200.0 million unsecured term loan (“Tranche A-1 Term Loan”) and a seven -year delayed draw $200.0 million unsecured term loan (“Tranche A-2 Term Loan”). The interest rate for the credit facility will vary based on a ratio of our total outstanding indebtedness to a valuation of certain real property businesses and assets and will range (a) in the case of the revolving credit facility, from LIBOR plus 1.10% to LIBOR plus 1.50% , (b) in the case of the Tranche A-1 Term Loan, from LIBOR plus 1.20% to LIBOR plus 1.70% and (c) in the case of the Tranche A-2 Term Loan, from LIBOR plus 1.55% to LIBOR plus 2.35% . On July 18, 2017, in connection with the Combination, we drew $115.8 million on the revolving credit facility and $50.0 million under the Tranche A-2 Term Loan. In connection with the execution of the credit facility, we incurred $6.8 million in fees and expenses. |
Summary of Significant Accoun19
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The following table provides a brief description of recent accounting pronouncements (Accounting Standards Update or “ASU”) by the Financial Accounting Standards Board (“FASB”) that could have a material effect on our financial statements: Standard Description Date of Adoption Effect on the Financial Statements or Other Significant Matters Standards not yet adopted ASU 2017‑09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting This standard clarifies which changes to the terms or conditions of a share-based payment award are subject to the guidance on modification accounting under FASB Accounting Standards Codification (“ASC”) Topic 718. Entities would apply the modification accounting guidance unless the value, vesting requirements and classification of a share-based payment award are the same immediately before and after a change to the terms or conditions of the award. January 2018 We are currently evaluating the overall impact of the adoption of ASU 2017-09. The adoption of this standard is not expected to have a material impact on our combined financial statements. ASU 2017‑05, Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets This standard clarifies the scope of recently established guidance on nonfinancial asset derecognition as well as the accounting for partial sales of nonfinancial assets. This update conforms the derecognition guidance on nonfinancial assets with the model for transactions in ASC 606. January 2018 The adoption of this standard is not expected to have an impact on our combined financial statements. ASU 2017‑01 Business Combinations (Topic 805): Clarifying the Definition of a Business This standard provides a screen to determine when an asset acquired or group of assets acquired is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. This screen reduces the number of transactions that need to be further evaluated. January 2018 The adoption of this standard will result in fewer real estate acquisitions qualifying as businesses and, accordingly, acquisition costs for those acquisitions that are not businesses will be capitalized rather than expensed. ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments and ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash These standards amend the existing guidance and address specific cash flow issues with the objective of reducing existing diversity in practice. ASU 2016-15 addresses eight specific cash flow issues and ASU 2016-18 specifically addresses presentation of restricted cash and restricted cash equivalents in the statements of cash flows. These standards require a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, entities may apply the amendments prospectively as of the earliest date practicable. January 2018 Other than the revised statement of cash flows presentation of restricted cash, the adoption of these standards is not expected to have a material impact on our combined financial statements. Standard Description Date of Adoption Effect on the Financial Statements or Other Significant Matters ASU 2016-02, Leases (Topic 842) This standard sets out the principles for the recognition, measurement, presentation and disclosure of leases for both lessees and lessors. ASU 2016-02 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. Lessees are required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. Lessees will recognize expense based on the effective interest method for finance leases or on a straight-line basis for operating leases. January 2019 We are currently evaluating the overall impact of the adoption of ASU 2016-02 on our combined financial statements, including the timing of adopting this standard. ASU 2016-02 will more significantly impact the accounting for leases in which we are the lessee. We have ground leases for which we will be required to record a right-of-use asset and lease liability equal to the present value of the remaining minimum lease payments upon adoption of this standard. We also expect that this standard will have an impact on the presentation of certain lease and non‑lease components of revenue from leases with no material impact to “total revenues.” ASU 2014-09, Revenue from Contracts with Customers (Topic 606), as clarified and amended by ASU 2016-08, ASU 2016-10 and ASU 2016-12 This standard establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. It requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. This standard may be adopted either retrospectively or on a modified retrospective basis. January 2018 We currently expect to utilize the modified retrospective method of adoption. We have commenced the execution of our project plan for adopting this standard, which consists of gathering and evaluating the inventory of our revenue streams. We expect this standard will have an impact on the presentation of certain lease and non-lease components of revenue from leases upon the adoption of ASU 2016‑02, Leases, with no material impact on “total revenues.” We expect this standard will have an impact on the timing of gains on certain sales of real estate. We are continuing to evaluate the impact of this standard on our combined financial statements. |
Organization and Basis of Pre20
Organization and Basis of Presentation and Combination (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of U.S Governmental Revenue | Only the U.S. federal government accounted for 10% or more of revenue for the three and six months ended June 30, 2017 and 2016 , as follows: Three Months Ended June 30, Six Months Ended June 30, (Dollars in thousands) 2017 2016 2017 2016 U.S. federal government $ 23,168 $ 23,326 $ 46,377 $ 47,345 Percentage of office segment revenue 26.74 % 26.03 % 26.80 % 26.26 % Percentage of total revenue 19.63 % 20.05 % 19.79 % 20.31 % |
Investments in Unconsolidated21
Investments in Unconsolidated Real Estate Ventures (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Composition of investments | The following is a summary of the composition of our investments in unconsolidated real estate ventures as of June 30, 2017 and December 31, 2016 : Ownership Interest Investment Balance Investments June 30, June 30, December 31, (In thousands) The Warner 55.0% $ 38,823 $ 39,417 Other investments Various 6,653 6,359 Total investments in unconsolidated real estate ventures $ 45,476 $ 45,776 The following is a summary of the debt of our unconsolidated real estate ventures as of June 30, 2017 and December 31, 2016 : Interest Rate 100% Unconsolidated Real Estate Ventures' Debt Investments Maturity June 30, June 30, December 31, (In thousands) The Warner 06/01/23 3.65% $ 273,000 $ 273,000 1101 17 th Street 01/19/18 (1) 2.47% 31,000 31,000 Unconsolidated real estate ventures - mortgages payable 304,000 304,000 Unamortized deferred financing costs, net (918 ) (1,034 ) Unconsolidated real estate ventures - mortgages payable, net $ 303,082 $ 302,966 ____________________ (1) In January 2017, the 1101 17 th Street mortgage was extended from January 2017 to January 2018. The following is a summary of the condensed combined financial information for all of our unconsolidated real estate ventures, as of June 30, 2017 and December 31, 2016 and for the three and six months ended June 30, 2017 and 2016 : June 30, December 31, 2016 Balance sheet information: (In thousands) Total assets $ 606,293 $ 598,239 Total liabilities $ 334,092 $ 327,862 Noncontrolling interests $ 343 $ 343 Total equity $ 271,858 $ 270,034 Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 Income statement information: (In thousands) Total revenue $ 18,318 $ 17,379 $ 36,557 $ 34,702 Net income $ 3,570 $ 2,298 $ 5,993 $ 2,476 |
Other Assets, Net (Tables)
Other Assets, Net (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Summary of other assets, net | The following is a summary of other assets, net as of June 30, 2017 and December 31, 2016 : June 30, December 31, (In thousands) Deferred leasing costs, gross $ 166,689 $ 157,258 Accumulated amortization (63,442 ) (57,910 ) Deferred leasing costs, net 103,247 99,348 Prepaid expenses 4,111 2,199 Identified intangible assets, net 2,739 3,063 Other 9,698 8,345 Total other assets, net $ 119,795 $ 112,955 |
Mortgages Payable (Tables)
Mortgages Payable (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Summary schedule of mortgages payable | The following is a summary of mortgages payable as of June 30, 2017 and December 31, 2016 : Interest Rate Balance as of June 30, June 30, December 31, (In thousands) Variable rate (1) 2.77% $ 767,291 $ 547,291 Fixed rate 5.52% 613,637 620,327 Mortgages payable 1,380,928 1,167,618 Unamortized deferred financing costs and premium/discount, net (4,851 ) (2,604 ) Mortgages payable, net $ 1,376,077 $ 1,165,014 Payable to Vornado Realty Trust (2) 3.70% $ 289,904 $ 283,232 __________________________ (1) On June 20, 2017, we completed a $220.0 million financing of The Bartlett, a 699 -unit residential building in Arlington, Virginia. The five -year interest-only mortgage loan bears interest at LIBOR plus 1.70% per annum and matures in June 2022. We realized net proceeds of approximately $217.2 million . (2) In June 2016, the mortgage loan for the Bowen Building was repaid with proceeds of a $115.6 million draw on Vornado’s revolving credit facility collateralized by an interest in the property, and, accordingly, has been reflected as a component of “Payable to Vornado Realty Trust” on the combined balance sheets as of June 30, 2017 and December 31, 2016 . The mortgage was assigned to JBG SMITH at Separation, and the note was repaid with amounts drawn under the revolving credit facility (see Note 12 for further discussion). |
Other Liabilities, Net (Tables)
Other Liabilities, Net (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Composition of other liabilities, net | The following is a summary of other liabilities, net as of June 30, 2017 and December 31, 2016 : June 30, December 31, (In thousands) Prepaid rent $ 13,762 $ 9,163 Lease assumptions liabilities and accrued tenant incentives 11,792 14,907 Lease intangible liabilities, net 10,862 11,570 Security deposits 10,316 10,324 Ground lease deferred rent payable 3,313 3,331 Other — 192 Total other liabilities, net $ 50,045 $ 49,487 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of financial instruments and liabilities as reflected on balance sheet | As of June 30, 2017 and December 31, 2016 , all financial instruments and liabilities were reflected in our condensed combined balance sheets at amounts which, in our estimation, reasonably approximated their fair values, except for the following: June 30, 2017 December 31, 2016 Carrying Amount (1) Fair Value Carrying Amount (1) Fair Value (In thousands) Financial liabilities: Mortgages payable $ 1,380,928 $ 1,411,419 $ 1,167,618 $ 1,192,267 ______________________________________ ( 1) The carrying amount consists of principal only. |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment information | Below is a summary of net income by segment for the three and six months ended June 30, 2017 and 2016 : Three Months Ended June 30, 2017 Office Multifamily Other Total (In thousands) Total revenue $ 86,631 $ 21,698 $ 9,691 $ 118,020 Operating expenses 57,639 13,083 16,846 87,568 Transaction and other costs — — 5,237 5,237 Total operating expenses 57,639 13,083 22,083 92,805 Operating income (loss) 28,992 8,615 (12,392 ) 25,215 Income from unconsolidated 105 — — 105 Interest and other income, net 857 7 106 970 Interest expense (10,476 ) (4,117 ) 7 (14,586 ) Income (loss) before income tax expense 19,478 4,505 (12,279 ) 11,704 Income tax expense (37 ) — (326 ) (363 ) Net income (loss) attributable to JBG SMITH Properties $ 19,441 $ 4,505 $ (12,605 ) $ 11,341 Three Months Ended June 30, 2016 Office Multifamily Other Total (In thousands) Total revenue $ 89,612 $ 16,319 $ 10,408 $ 116,339 Total operating expenses 58,964 10,594 16,517 86,075 Operating income (loss) 30,648 5,725 (6,109 ) 30,264 Loss from unconsolidated (374 ) — — (374 ) Interest and other income, net 759 — 1 760 Interest expense (10,505 ) (3,097 ) 53 (13,549 ) Income (loss) before income tax expense 20,528 2,628 (6,055 ) 17,101 Income tax expense (81 ) — (237 ) (318 ) Net income (loss) attributable to JBG SMITH Properties $ 20,447 $ 2,628 $ (6,292 ) $ 16,783 Six Months Ended June 30, 2017 Office Multifamily Other Total (In thousands) Total revenue $ 173,044 $ 42,473 $ 18,775 $ 234,292 Operating expenses 116,128 26,476 35,789 178,393 Transaction and other costs — — 11,078 11,078 Total operating expenses 116,128 26,476 46,867 189,471 Operating income (loss) 56,916 15,997 (28,092 ) 44,821 Income from unconsolidated 314 — — 314 Interest and other income, net 1,723 7 15 1,745 Interest expense (20,783 ) (7,780 ) 59 (28,504 ) Income (loss) before income tax expense 38,170 8,224 (28,018 ) 18,376 Income tax expense (68 ) — (649 ) (717 ) Net income (loss) attributable to JBG SMITH Properties $ 38,102 $ 8,224 $ (28,667 ) $ 17,659 Six Months Ended June 30, 2016 Office Multifamily Other Total (In thousands) Total revenue $ 180,296 $ 31,825 $ 21,002 $ 233,123 Total operating expenses 123,116 19,541 35,927 178,584 Operating income (loss) 57,180 12,284 (14,925 ) 54,539 Loss from unconsolidated (1,536 ) — — (1,536 ) Interest and other income, net 1,540 — 3 1,543 Interest expense (21,517 ) (4,283 ) 166 (25,634 ) Income (loss) before income tax expense 35,667 8,001 (14,756 ) 28,912 Income tax expense (98 ) — (484 ) (582 ) Net income (loss) attributable to JBG SMITH Properties $ 35,569 $ 8,001 $ (15,240 ) $ 28,330 The following is a summary of certain balance sheet data by segment as of June 30, 2017 and December 31, 2016 : Office Multifamily Other Total June 30, 2017 (In thousands) Real estate, at cost $ 2,935,001 $ 965,577 $ 270,735 $ 4,171,313 Investments in unconsolidated real estate ventures $ 45,333 $ — $ 143 $ 45,476 Total assets $ 2,527,891 $ 1,100,658 $ 281,396 $ 3,909,945 December 31, 2016 Real estate, at cost $ 2,929,976 $ 959,267 $ 266,148 $ 4,155,391 Investments in unconsolidated real $ 45,647 $ — $ 129 $ 45,776 Total assets $ 2,498,148 $ 872,838 $ 289,654 $ 3,660,640 |
Organization and Basis of Pre27
Organization and Basis of Presentation and Combination - Narrative (Details) shares in Millions, $ in Millions | Jul. 18, 2017ft²building_unitpropertiesshares | Jul. 17, 2017shares | Jul. 07, 2017 | Jun. 30, 2017segment | Dec. 31, 2016USD ($) |
Real Estate Properties [Line Items] | |||||
Number of reportable segments | segment | 2 | ||||
Other Assets | |||||
Real Estate Properties [Line Items] | |||||
Prior period reclassification adjustment | $ | $ 4 | ||||
Subsequent Event | |||||
Real Estate Properties [Line Items] | |||||
Common stock issued (in shares) | shares | 94.7 | ||||
Common limited partnership units (in shares) | shares | 5.8 | ||||
Common shares outstanding (in shares) | shares | 118.2 | ||||
Common limited partnership units outstanding (in shares) | shares | 19.5 | ||||
Number of real estate properties | properties | 68 | ||||
Subsequent Event | Asset under Construction | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 11 | ||||
Subsequent Event | Near-Term Development | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 2 | ||||
Subsequent Event | Future Development | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 44 | ||||
Area of real estate property (in square feet) | 22,000,000 | ||||
Subsequent Event | Office Building | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 50 | ||||
Area of real estate property (in square feet) | 13,900,000 | ||||
Subsequent Event | Office Building | Asset under Construction | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 5 | ||||
Area of real estate property (in square feet) | 1,300,000 | ||||
Subsequent Event | Multifamily | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 14 | ||||
Number of building units | building_unit | 6,016 | ||||
Subsequent Event | Multifamily | Asset under Construction | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 6 | ||||
Number of building units | building_unit | 1,334 | ||||
Subsequent Event | Multifamily | Near-Term Development | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 1 | ||||
Number of building units | building_unit | 433 | ||||
Subsequent Event | Other Property | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 4 | ||||
Area of real estate property (in square feet) | 765,000 | ||||
Subsequent Event | Other Property | Near-Term Development | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 1 | ||||
Area of real estate property (in square feet) | 65,000 | ||||
Subsequent Event | Wholly Owned Properties | Future Development | |||||
Real Estate Properties [Line Items] | |||||
Area of real estate property (in square feet) | 18,300,000 | ||||
Subsequent Event | Wholly Owned Properties | Office Building | |||||
Real Estate Properties [Line Items] | |||||
Area of real estate property (in square feet) | 11,900,000 | ||||
Subsequent Event | Wholly Owned Properties | Office Building | Asset under Construction | |||||
Real Estate Properties [Line Items] | |||||
Area of real estate property (in square feet) | 1,200,000 | ||||
Subsequent Event | Wholly Owned Properties | Multifamily | |||||
Real Estate Properties [Line Items] | |||||
Number of building units | building_unit | 4,232 | ||||
Subsequent Event | Wholly Owned Properties | Multifamily | Asset under Construction | |||||
Real Estate Properties [Line Items] | |||||
Number of building units | building_unit | 1,146 | ||||
Subsequent Event | Wholly Owned Properties | Multifamily | Near-Term Development | |||||
Real Estate Properties [Line Items] | |||||
Number of building units | building_unit | 303 | ||||
Subsequent Event | Wholly Owned Properties | Other Property | |||||
Real Estate Properties [Line Items] | |||||
Area of real estate property (in square feet) | 348,000 | ||||
Subsequent Event | Wholly Owned Properties | Other Property | Near-Term Development | |||||
Real Estate Properties [Line Items] | |||||
Area of real estate property (in square feet) | 6,500 | ||||
Subsequent Event | JBG Companies | |||||
Real Estate Properties [Line Items] | |||||
Equity interest issued for acquisition (in shares) | shares | 37.2 | ||||
Number of real estate properties | properties | 30 | ||||
Subsequent Event | JBG Companies | Asset under Construction | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 11 | ||||
Area of real estate property (in square feet) | 2,500,000 | ||||
Subsequent Event | JBG Companies | Near-Term Development | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 2 | ||||
Area of real estate property (in square feet) | 401,000 | ||||
Subsequent Event | JBG Companies | Future Development | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 26 | ||||
Area of real estate property (in square feet) | 11,700,000 | ||||
Subsequent Event | JBG Companies | Office Building | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 19 | ||||
Area of real estate property (in square feet) | 3,600,000 | ||||
Subsequent Event | JBG Companies | Multifamily | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 9 | ||||
Number of building units | building_unit | 2,883 | ||||
Subsequent Event | JBG Companies | Other Property | |||||
Real Estate Properties [Line Items] | |||||
Number of real estate properties | properties | 2 | ||||
Area of real estate property (in square feet) | 490,000 | ||||
Subsequent Event | JBG Companies | Wholly Owned Properties | Asset under Construction | |||||
Real Estate Properties [Line Items] | |||||
Area of real estate property (in square feet) | 2,200,000 | ||||
Subsequent Event | JBG Companies | Wholly Owned Properties | Near-Term Development | |||||
Real Estate Properties [Line Items] | |||||
Area of real estate property (in square feet) | 242,000 | ||||
Subsequent Event | JBG Companies | Wholly Owned Properties | Future Development | |||||
Real Estate Properties [Line Items] | |||||
Area of real estate property (in square feet) | 8,500,000 | ||||
Subsequent Event | JBG Companies | Wholly Owned Properties | Office Building | |||||
Real Estate Properties [Line Items] | |||||
Area of real estate property (in square feet) | 2,300,000 | ||||
Subsequent Event | JBG Companies | Wholly Owned Properties | Multifamily | |||||
Real Estate Properties [Line Items] | |||||
Number of building units | building_unit | 1,099 | ||||
Subsequent Event | JBG Companies | Wholly Owned Properties | Other Property | |||||
Real Estate Properties [Line Items] | |||||
Area of real estate property (in square feet) | 73,000 | ||||
Subsequent Event | JBG Companies | Common stock | |||||
Real Estate Properties [Line Items] | |||||
Equity interest issued for acquisition (in shares) | shares | 23.5 | ||||
Subsequent Event | JBG Companies | Partnership units | |||||
Real Estate Properties [Line Items] | |||||
Equity interest issued for acquisition (in shares) | shares | 13.7 | ||||
Subsequent Event | Affiliate | Vornado | |||||
Real Estate Properties [Line Items] | |||||
Percentage of common shares distributed | 100.00% | ||||
Spinoff ratio | 0.5 | ||||
Limited Partners spinoff ratio | 0.5 |
Organization and Basis of Pre28
Organization and Basis of Presentation and Combination - Schedule of revenue by major customer (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 118,020 | $ 116,339 | $ 234,292 | $ 233,123 |
U.S. federal government | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 23,168 | $ 23,326 | $ 46,377 | $ 47,345 |
U.S. federal government contracts concentration risk | Office segment revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of revenue | 26.74% | 26.03% | 26.80% | 26.26% |
U.S. federal government contracts concentration risk | Total revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of revenue | 19.63% | 20.05% | 19.79% | 20.31% |
Investments in Unconsolidated29
Investments in Unconsolidated Real Estate Ventures - Summary of Composition of Investments (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Schedule of Equity Method Investments [Line Items] | ||
Investment Balance | $ 45,476 | $ 45,776 |
The Warner | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership Interest | 55.00% | |
Investment Balance | $ 38,823 | 39,417 |
Other investments | ||
Schedule of Equity Method Investments [Line Items] | ||
Investment Balance | $ 6,653 | $ 6,359 |
Investments in Unconsolidated30
Investments in Unconsolidated Real Estate Ventures - Summary of Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Schedule of Equity Method Investments [Line Items] | ||
Unconsolidated real estate ventures - mortgages payable | $ 304,000 | $ 304,000 |
Unamortized deferred financing costs, net | (918) | (1,034) |
Unconsolidated real estate ventures - mortgages payable, net | $ 303,082 | 302,966 |
The Warner | ||
Schedule of Equity Method Investments [Line Items] | ||
Interest Rate | 3.65% | |
Unconsolidated real estate ventures - mortgages payable | $ 273,000 | 273,000 |
1101 17th Street | ||
Schedule of Equity Method Investments [Line Items] | ||
Interest Rate | 2.47% | |
Unconsolidated real estate ventures - mortgages payable | $ 31,000 | $ 31,000 |
Investments in Unconsolidated31
Investments in Unconsolidated Real Estate Ventures - Condensed Combined Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Balance sheet information: | |||||
Total assets | $ 606,293 | $ 606,293 | $ 598,239 | ||
Total liabilities | 334,092 | 334,092 | 327,862 | ||
Noncontrolling interests | 343 | 343 | 343 | ||
Total equity | 271,858 | 271,858 | $ 270,034 | ||
Income statement information: | |||||
Total revenue | 18,318 | $ 17,379 | 36,557 | $ 34,702 | |
Net income | $ 3,570 | $ 2,298 | $ 5,993 | $ 2,476 |
Variable Interest Entities (Det
Variable Interest Entities (Details) - USD ($) $ in Millions | Jun. 30, 2017 | Dec. 31, 2016 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Net carrying amount of investment | $ 43.2 | $ 42.4 |
Other Assets, Net (Details)
Other Assets, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Deferred leasing costs, gross | $ 166,689 | $ 157,258 |
Accumulated amortization | (63,442) | (57,910) |
Deferred leasing costs, net | 103,247 | 99,348 |
Prepaid expenses | 4,111 | 2,199 |
Identified intangible assets, net | 2,739 | 3,063 |
Other | 9,698 | 8,345 |
Total other assets, net | $ 119,795 | $ 112,955 |
Mortgages Payable - Schedule of
Mortgages Payable - Schedule of mortgages payable (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||
Mortgages payable, net | $ 1,376,077 | $ 1,165,014 |
Payable to Vornado Realty Trust | $ 289,904 | 283,232 |
Mortgages | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 2.77% | |
Fixed interest rate | 5.52% | |
Interest rate on payable to Vornado | 3.70% | |
Variable rate amount | $ 767,291 | 547,291 |
Fixed rate amount | 613,637 | 620,327 |
Mortgages payable | 1,380,928 | 1,167,618 |
Unamortized deferred financing costs and premium/discount, net | (4,851) | (2,604) |
Mortgages payable, net | 1,376,077 | 1,165,014 |
Payable to Vornado Realty Trust | $ 289,904 | $ 283,232 |
Mortgages Payable - Narrative (
Mortgages Payable - Narrative (Details) | Jun. 20, 2017USD ($)building_unit | Jun. 30, 2017USD ($) |
Revolving credit facility | ||
Participating Mortgage Loans [Line Items] | ||
Proceeds from lines of credit | $ 115,600,000 | |
The Bartlett | ||
Participating Mortgage Loans [Line Items] | ||
Number of building units | building_unit | 699 | |
Mortgages | Mortgage Loan, Due June 2022 | ||
Participating Mortgage Loans [Line Items] | ||
Debt instrument, face amount | $ 220,000,000 | |
Term of debt | 5 years | |
Proceeds from issuance of debt | $ 217,200,000 | |
Mortgages | Mortgage Loan, Due June 2022 | LIBOR | ||
Participating Mortgage Loans [Line Items] | ||
Mortgage loan interest rate | 1.70% |
Other Liabilities, Net (Details
Other Liabilities, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Other Liabilities Disclosure [Abstract] | ||
Prepaid rent | $ 13,762 | $ 9,163 |
Lease assumptions liabilities and accrued tenant incentives | 11,792 | 14,907 |
Lease intangible liabilities, net | 10,862 | 11,570 |
Security deposits | 10,316 | 10,324 |
Ground lease deferred rent payable | 3,313 | 3,331 |
Other | 0 | 192 |
Total other liabilities, net | $ 50,045 | $ 49,487 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Assets and Liabilities Not Measured at Fair Value (Details) - Mortgages - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Carrying Amount | ||
Financial liabilities: | ||
Mortgages payable | $ 1,380,928 | $ 1,167,618 |
Fair Value | ||
Financial liabilities: | ||
Mortgages payable | $ 1,411,419 | $ 1,192,267 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Segment Reporting Information [Line Items] | |||||
Total revenue | $ 118,020 | $ 116,339 | $ 234,292 | $ 233,123 | |
Operating expenses | 87,568 | 178,393 | |||
Transaction and other costs | 5,237 | 0 | 11,078 | 0 | |
Total operating expenses | 92,805 | 86,075 | 189,471 | 178,584 | |
OPERATING INCOME | 25,215 | 30,264 | 44,821 | 54,539 | |
Income from unconsolidated real estate ventures | 105 | (374) | 314 | (1,536) | |
Interest and other income, net | 970 | 760 | 1,745 | 1,543 | |
Interest expense | (14,586) | (13,549) | (28,504) | (25,634) | |
INCOME BEFORE INCOME TAX EXPENSE | 11,704 | 17,101 | 18,376 | 28,912 | |
Income tax expense | (363) | (318) | (717) | (582) | |
NET INCOME ATTRIBUTABLE TO JBG SMITH PROPERTIES | 11,341 | 16,783 | 17,659 | 28,330 | |
Real estate, at cost | 4,171,313 | 4,171,313 | $ 4,155,391 | ||
Investments in unconsolidated real estate ventures | 45,476 | 45,476 | 45,776 | ||
Total assets | 3,909,945 | 3,909,945 | 3,660,640 | ||
Office | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 86,631 | 89,612 | 173,044 | 180,296 | |
Operating expenses | 57,639 | 116,128 | |||
Transaction and other costs | 0 | 0 | |||
Total operating expenses | 57,639 | 58,964 | 116,128 | 123,116 | |
OPERATING INCOME | 28,992 | 30,648 | 56,916 | 57,180 | |
Income from unconsolidated real estate ventures | 105 | (374) | 314 | (1,536) | |
Interest and other income, net | 857 | 759 | 1,723 | 1,540 | |
Interest expense | (10,476) | (10,505) | (20,783) | (21,517) | |
INCOME BEFORE INCOME TAX EXPENSE | 19,478 | 20,528 | 38,170 | 35,667 | |
Income tax expense | (37) | (81) | (68) | (98) | |
NET INCOME ATTRIBUTABLE TO JBG SMITH PROPERTIES | 19,441 | 20,447 | 38,102 | 35,569 | |
Real estate, at cost | 2,935,001 | 2,935,001 | 2,929,976 | ||
Investments in unconsolidated real estate ventures | 45,333 | 45,333 | 45,647 | ||
Total assets | 2,527,891 | 2,527,891 | 2,498,148 | ||
Multifamily | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 21,698 | 16,319 | 42,473 | 31,825 | |
Operating expenses | 13,083 | 26,476 | |||
Transaction and other costs | 0 | 0 | |||
Total operating expenses | 13,083 | 10,594 | 26,476 | 19,541 | |
OPERATING INCOME | 8,615 | 5,725 | 15,997 | 12,284 | |
Income from unconsolidated real estate ventures | 0 | 0 | 0 | 0 | |
Interest and other income, net | 7 | 0 | 7 | 0 | |
Interest expense | (4,117) | (3,097) | (7,780) | (4,283) | |
INCOME BEFORE INCOME TAX EXPENSE | 4,505 | 2,628 | 8,224 | 8,001 | |
Income tax expense | 0 | 0 | 0 | 0 | |
NET INCOME ATTRIBUTABLE TO JBG SMITH PROPERTIES | 4,505 | 2,628 | 8,224 | 8,001 | |
Real estate, at cost | 965,577 | 965,577 | 959,267 | ||
Investments in unconsolidated real estate ventures | 0 | 0 | 0 | ||
Total assets | 1,100,658 | 1,100,658 | 872,838 | ||
Other | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 9,691 | 10,408 | 18,775 | 21,002 | |
Operating expenses | 16,846 | 35,789 | |||
Transaction and other costs | 5,237 | 11,078 | |||
Total operating expenses | 22,083 | 16,517 | 46,867 | 35,927 | |
OPERATING INCOME | (12,392) | (6,109) | (28,092) | (14,925) | |
Income from unconsolidated real estate ventures | 0 | 0 | 0 | 0 | |
Interest and other income, net | 106 | 1 | 15 | 3 | |
Interest expense | 7 | 53 | 59 | 166 | |
INCOME BEFORE INCOME TAX EXPENSE | (12,279) | (6,055) | (28,018) | (14,756) | |
Income tax expense | (326) | (237) | (649) | (484) | |
NET INCOME ATTRIBUTABLE TO JBG SMITH PROPERTIES | (12,605) | $ (6,292) | (28,667) | $ (15,240) | |
Real estate, at cost | 270,735 | 270,735 | 266,148 | ||
Investments in unconsolidated real estate ventures | 143 | 143 | 129 | ||
Total assets | $ 281,396 | $ 281,396 | $ 289,654 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Millions | Jun. 30, 2017USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Additional capital funding committed amount | $ 5.3 |
Non-cancelable operating leases future payments | $ 576.1 |
Related Party Transactions (Det
Related Party Transactions (Details) ft² in Thousands | Jul. 18, 2017 | Aug. 12, 2014USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($)ft² | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($)ft² | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($)ft² | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Aug. 31, 2014USD ($)ft² |
Related Party Transaction [Line Items] | |||||||||||
Receivable from Vornado Realty Trust | $ 76,738,000 | $ 76,738,000 | $ 76,738,000 | $ 75,062,000 | |||||||
Universal Buildings, Washington DC | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Area of real estate property (in square feet) | ft² | 687 | ||||||||||
Bowen Building, Washington DC | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Area of real estate property (in square feet) | ft² | 231 | 231 | 231 | ||||||||
Vornado's revolving credit facility | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Proceeds from Vornado's revolving credit facility | $ 115,600,000 | ||||||||||
Financing of the Universal Buildings | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Debt instrument, face amount | $ 185,000,000 | ||||||||||
Affiliate | Vornado | Vornado's revolving credit facility | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Interest expense to Vornado | 625,000 | $ 145,000 | 1,200,000 | $ 145,000 | |||||||
Proceeds from Vornado's revolving credit facility | $ 115,600,000 | ||||||||||
Affiliate | Vornado | Mortgage loan secured by Bowen Building | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Repayment of mortgage Loan | 115,000,000 | ||||||||||
Accrued interest on mortgage loan | $ 608,000 | ||||||||||
Affiliate | Allocations of centralized corporate costs | Vornado | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Related party transaction amount | $ 5,400,000 | 4,600,000 | $ 12,200,000 | 10,700,000 | |||||||
Affiliate | Financing transactions | Vornado | Financing of the Universal Buildings | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Loan to Vornado | $ 86,000,000 | ||||||||||
Effective interest rate | 4.40% | 4.40% | 4.40% | ||||||||
Repayment of loan receivable by Vornado | 4,000,000 | $ 7,000,000 | |||||||||
Interest Income on loan receivable from Vornado | $ 843,000 | 746,000 | $ 1,700,000 | 1,500,000 | |||||||
Affiliate | Financing transactions | Vornado | Financing of the Universal Buildings | LIBOR | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Mortgage loan interest rate | 2.90% | ||||||||||
Affiliate | Financing transactions | Vornado | Note agreement for development of Bartlett | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Debt instrument, face amount | $ 170,000,000 | $ 170,000,000 | $ 170,000,000 | ||||||||
Effective interest rate | 4.70% | 4.70% | 4.70% | ||||||||
Amount outstanding on note agreements with Vornado | $ 174,300,000 | $ 174,300,000 | $ 174,300,000 | $ 166,500,000 | |||||||
Interest expense to Vornado | 2,000,000 | 1,100,000 | $ 3,700,000 | 1,800,000 | |||||||
Affiliate | Financing transactions | Vornado | Note agreement for development of Bartlett | LIBOR | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Mortgage loan interest rate | 2.90% | ||||||||||
Affiliate | Supervise cleaning, engineering and security services | BMS | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Related party transaction amount | $ 3,200,000 | $ 3,200,000 | $ 6,300,000 | $ 6,300,000 | |||||||
Affiliate | Separation and Combination transaction | Vornado | Subsequent Event | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Transaction services, initial period | 2 years | ||||||||||
Trustee | Consulting agreement | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Transaction services, initial period | 24 months | ||||||||||
Related party transaction, monthly amount | $ 166,667 |
Subsequent Events - Separation
Subsequent Events - Separation and Combination Narrative (Details) - Subsequent Event $ / shares in Units, shares in Millions, $ in Millions | Jul. 18, 2017USD ($)ft²building_unitpropertiesperson$ / sharesshares | Jul. 07, 2017 | Jul. 17, 2017shares |
Subsequent Event [Line Items] | |||
Common stock issued (in shares) | shares | 94.7 | ||
Common limited partnership units (in shares) | shares | 5.8 | ||
Number of real estate properties | properties | 68 | ||
Asset under Construction | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 11 | ||
Near-Term Development | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 2 | ||
Future Development | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 44 | ||
Area of real estate property acquired (in square feet) | 22,000,000 | ||
Wholly Owned Properties | Future Development | |||
Subsequent Event [Line Items] | |||
Area of real estate property acquired (in square feet) | 18,300,000 | ||
Office Building | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 50 | ||
Area of real estate property acquired (in square feet) | 13,900,000 | ||
Office Building | Asset under Construction | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 5 | ||
Area of real estate property acquired (in square feet) | 1,300,000 | ||
Office Building | Wholly Owned Properties | |||
Subsequent Event [Line Items] | |||
Area of real estate property acquired (in square feet) | 11,900,000 | ||
Office Building | Wholly Owned Properties | Asset under Construction | |||
Subsequent Event [Line Items] | |||
Area of real estate property acquired (in square feet) | 1,200,000 | ||
Multifamily | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 14 | ||
Number of building units | building_unit | 6,016 | ||
Multifamily | Asset under Construction | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 6 | ||
Number of building units | building_unit | 1,334 | ||
Multifamily | Near-Term Development | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 1 | ||
Number of building units | building_unit | 433 | ||
Multifamily | Wholly Owned Properties | |||
Subsequent Event [Line Items] | |||
Number of building units | building_unit | 4,232 | ||
Multifamily | Wholly Owned Properties | Asset under Construction | |||
Subsequent Event [Line Items] | |||
Number of building units | building_unit | 1,146 | ||
Multifamily | Wholly Owned Properties | Near-Term Development | |||
Subsequent Event [Line Items] | |||
Number of building units | building_unit | 303 | ||
Other Property | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 4 | ||
Area of real estate property acquired (in square feet) | 765,000 | ||
Other Property | Near-Term Development | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 1 | ||
Area of real estate property acquired (in square feet) | 65,000 | ||
Other Property | Wholly Owned Properties | |||
Subsequent Event [Line Items] | |||
Area of real estate property acquired (in square feet) | 348,000 | ||
Other Property | Wholly Owned Properties | Near-Term Development | |||
Subsequent Event [Line Items] | |||
Area of real estate property acquired (in square feet) | 6,500 | ||
JBG Companies | |||
Subsequent Event [Line Items] | |||
Mortgages payable liabilities assumed in acquisition | $ | $ 770 | ||
Equity interest issued for acquisition (in shares) | shares | 37.2 | ||
Price per share of stock issued for acquisition (in dollars per share) | $ / shares | $ 37.10 | ||
Number of real estate properties | properties | 30 | ||
Number of unrelated owners | person | 20 | ||
Number of owners turned employees | person | 19 | ||
Number of owners turned board of trustee members | person | 3 | ||
JBG Companies | Asset under Construction | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 11 | ||
Area of real estate property acquired (in square feet) | 2,500,000 | ||
JBG Companies | Near-Term Development | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 2 | ||
Area of real estate property acquired (in square feet) | 401,000 | ||
JBG Companies | Future Development | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 26 | ||
Area of real estate property acquired (in square feet) | 11,700,000 | ||
JBG Companies | Wholly Owned Properties | Asset under Construction | |||
Subsequent Event [Line Items] | |||
Area of real estate property acquired (in square feet) | 2,200,000 | ||
JBG Companies | Wholly Owned Properties | Near-Term Development | |||
Subsequent Event [Line Items] | |||
Area of real estate property acquired (in square feet) | 242,000 | ||
JBG Companies | Wholly Owned Properties | Future Development | |||
Subsequent Event [Line Items] | |||
Area of real estate property acquired (in square feet) | 8,500,000 | ||
JBG Companies | Office Building | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 19 | ||
Area of real estate property acquired (in square feet) | 3,600,000 | ||
JBG Companies | Office Building | Wholly Owned Properties | |||
Subsequent Event [Line Items] | |||
Area of real estate property acquired (in square feet) | 2,300,000 | ||
JBG Companies | Multifamily | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 9 | ||
Number of building units | building_unit | 2,883 | ||
JBG Companies | Multifamily | Wholly Owned Properties | |||
Subsequent Event [Line Items] | |||
Number of building units | building_unit | 1,099 | ||
JBG Companies | Other Property | |||
Subsequent Event [Line Items] | |||
Number of real estate properties | properties | 2 | ||
Area of real estate property acquired (in square feet) | 490,000 | ||
JBG Companies | Other Property | Wholly Owned Properties | |||
Subsequent Event [Line Items] | |||
Area of real estate property acquired (in square feet) | 73,000 | ||
Affiliate | Vornado | |||
Subsequent Event [Line Items] | |||
Spinoff ratio | 0.5 | ||
Limited Partners spinoff ratio | 0.5 | ||
Affiliate | Vornado | Separation and Combination transaction | |||
Subsequent Event [Line Items] | |||
Transaction services, initial period | 2 years |
Subsequent Events - Equity Awar
Subsequent Events - Equity Awards Narrative (Details) - Subsequent Event | Aug. 01, 2017installmentshares | Jul. 18, 2017USD ($)person$ / sharesshares | Jul. 17, 2017shares |
Trustee | Long-term incentive partnership units | |||
Subsequent Event [Line Items] | |||
Deferred compensation arrangement, number of individuals awarded | person | 7 | ||
Deferred compensation arrangement, value | $ | $ 250,000 | ||
JBG Companies | |||
Subsequent Event [Line Items] | |||
Price per share of stock issued for acquisition (in dollars per share) | $ / shares | $ 37.10 | ||
Initial Formation Awards | |||
Subsequent Event [Line Items] | |||
Equity grants (in shares) | 2,700,000 | ||
Value of stock granted from share-based compensation plans | $ | $ 100,000,000 | ||
Initial Formation Awards | Vesting period one | |||
Subsequent Event [Line Items] | |||
Percentage of vesting rights for each tranche | 25.00% | ||
Initial Formation Awards | Vesting period two | |||
Subsequent Event [Line Items] | |||
Percentage of vesting rights for each tranche | 25.00% | ||
Initial Formation Awards | Vesting period three | |||
Subsequent Event [Line Items] | |||
Percentage of vesting rights for each tranche | 50.00% | ||
Long-term incentive partnership units | |||
Subsequent Event [Line Items] | |||
Equity grants (in shares) | 303,700 | ||
Number of vesting installments under share-based arrangement | installment | 4 | ||
Out-performance award units | |||
Subsequent Event [Line Items] | |||
Equity grants (in shares) | 607,000 | ||
Vesting period for share-based compensation plans | 3 years | ||
Out-performance award units | Vesting period one | |||
Subsequent Event [Line Items] | |||
Percentage of vesting rights for each tranche | 50.00% | ||
Out-performance award units | Vesting period two | |||
Subsequent Event [Line Items] | |||
Percentage of vesting rights for each tranche | 50.00% | ||
2017 Omnibus Share Plan | |||
Subsequent Event [Line Items] | |||
Share-based compensation arrangement, number of shares authorized | 10,300,000 |
Subsequent Events - Credit Faci
Subsequent Events - Credit Facility Narrative (Details) - Subsequent Event - Line of credit | Jul. 18, 2017USD ($)extension_option |
Subsequent Event [Line Items] | |
Credit facility, maximum borrowing capacity | $ 1,400,000,000 |
Fees and expenses on debt | 6,800,000 |
Revolving credit facility | |
Subsequent Event [Line Items] | |
Credit facility, maximum borrowing capacity | $ 1,000,000,000 |
Term of debt | 4 years |
Number of debt extension options | extension_option | 2 |
Debt extension option period | 6 months |
Credit drawn from facility | $ 115,800,000 |
Revolving credit facility | LIBOR | Minimum | |
Subsequent Event [Line Items] | |
Basis spread on variable rate | 1.10% |
Revolving credit facility | LIBOR | Maximum | |
Subsequent Event [Line Items] | |
Basis spread on variable rate | 1.50% |
Tranche A-1 Term Loan | |
Subsequent Event [Line Items] | |
Credit facility, maximum borrowing capacity | $ 200,000,000 |
Term of debt | 5 years 6 months |
Tranche A-1 Term Loan | LIBOR | Minimum | |
Subsequent Event [Line Items] | |
Basis spread on variable rate | 1.20% |
Tranche A-1 Term Loan | LIBOR | Maximum | |
Subsequent Event [Line Items] | |
Basis spread on variable rate | 1.70% |
Tranche A-2 Term Loan | |
Subsequent Event [Line Items] | |
Credit facility, maximum borrowing capacity | $ 200,000,000 |
Term of debt | 7 years |
Credit drawn from facility | $ 50,000,000 |
Tranche A-2 Term Loan | LIBOR | Minimum | |
Subsequent Event [Line Items] | |
Basis spread on variable rate | 1.55% |
Tranche A-2 Term Loan | LIBOR | Maximum | |
Subsequent Event [Line Items] | |
Basis spread on variable rate | 2.35% |