Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Nov. 06, 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 | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 117,957,107 |
Condensed Combined Balance Shee
Condensed Combined Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Real estate, at cost: | ||
Land and improvements | $ 1,272,997 | $ 939,592 |
Buildings and improvements | 3,662,853 | 3,064,466 |
Construction in progress, including land | 906,680 | 151,333 |
Real estate, at cost | 5,842,530 | 4,155,391 |
Less accumulated depreciation | (982,454) | (930,769) |
Real estate, net | 4,860,076 | 3,224,622 |
Cash and cash equivalents | 367,896 | 29,000 |
Restricted cash | 17,521 | 3,263 |
Tenant and other receivables, net | 50,474 | 33,380 |
Deferred rent receivable, net | 145,683 | 136,582 |
Investments in and advances to unconsolidated real estate ventures | 284,986 | 45,776 |
Receivable from former parent | 0 | 75,062 |
Other assets, net | 288,391 | 112,955 |
TOTAL ASSETS | 6,015,027 | 3,660,640 |
Liabilities: | ||
Mortgages payable, net | 1,977,674 | 1,165,014 |
Revolving credit facility | 115,751 | 0 |
Unsecured term loan, net | 46,389 | 0 |
Payable to former parent | 0 | 283,232 |
Accounts payable and accrued expenses | 131,627 | 40,923 |
Other liabilities, net | 100,774 | 49,487 |
Total liabilities | 2,372,215 | 1,538,656 |
Commitments and Contingencies | ||
Redeemable noncontrolling interests | 567,001 | 0 |
Shareholders' equity: | ||
Preferred shares, $0.01 par value - 200,000 shares authorized, none issued | 0 | 0 |
Common shares, $0.01 par value - 500,000 shares authorized and 117,957 shares issued and outstanding at September 30, 2017 | 1,180 | 0 |
Additional paid-in capital | 3,099,056 | 0 |
Accumulated deficit | (28,827) | 0 |
Former parent equity | 3,071,409 | 2,121,689 |
Noncontrolling interests in consolidated subsidiaries | 4,402 | 295 |
Total equity | 3,075,811 | 2,121,984 |
TOTAL LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY | $ 6,015,027 | $ 3,660,640 |
Condensed Combined Balance She3
Condensed Combined Balance Sheets (Parenthetical) | Sep. 30, 2017$ / sharesshares |
Statement of Financial Position [Abstract] | |
Preferred shares, par value (in dollars per share) | $ / shares | $ 0.01 |
Preferred shares, shares authorized | 200,000,000 |
Preferred shares, shares issued | 0 |
Preferred shares, shares outstanding | 0 |
Common shares, par value (in dollars per share) | $ / shares | $ 0.01 |
Common shares, shares authorized | 500,000,000 |
Common shares, shares issued | 117,957,000 |
Common shares, shares outstanding | 117,957,000 |
Condensed Combined Statements o
Condensed Combined Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
REVENUE | ||||
Property rentals | $ 116,458 | $ 103,265 | $ 316,899 | $ 299,497 |
Tenant reimbursements | 9,593 | 10,231 | 27,161 | 28,428 |
Third-party real estate services, including reimbursements | 25,141 | 8,297 | 38,881 | 24,617 |
Other income | 1,158 | 1,564 | 3,701 | 3,938 |
Total revenue | 152,350 | 123,357 | 386,642 | 356,480 |
EXPENSES | ||||
Depreciation and amortization | 43,951 | 31,377 | 109,726 | 98,291 |
Property operating | 29,634 | 27,287 | 77,341 | 75,087 |
Real estate taxes | 17,194 | 14,462 | 47,978 | 43,712 |
General and administrative: | ||||
Corporate and other | 10,593 | 10,913 | 35,536 | 36,040 |
Third-party real estate services | 21,178 | 4,779 | 30,362 | 14,272 |
Share-based compensation related to Formation Transaction | 14,445 | 0 | 14,445 | 0 |
Transaction and other costs | 104,095 | 1,528 | 115,173 | 1,528 |
Total operating expenses | 241,090 | 90,346 | 430,561 | 268,930 |
OPERATING (LOSS) INCOME | (88,740) | 33,011 | (43,919) | 87,550 |
(Loss) income from unconsolidated real estate ventures | (1,679) | 584 | (1,365) | (952) |
Interest and other (loss) income, net | (379) | 749 | 1,366 | 2,292 |
Interest expense | (15,309) | (13,028) | (43,813) | (38,662) |
Loss on extinguishment of debt | (689) | 0 | (689) | 0 |
Gain on bargain purchase | 27,771 | 0 | 27,771 | 0 |
(LOSS) INCOME BEFORE INCOME TAX EXPENSE | (79,025) | 21,316 | (60,649) | 50,228 |
Income tax benefit (expense) | 1,034 | (302) | 317 | (884) |
NET (LOSS) INCOME | (77,991) | 21,014 | (60,332) | 49,344 |
Net loss attributable to redeemable noncontrolling interests | 8,160 | 0 | 2,481 | 0 |
NET (LOSS) INCOME ATTRIBUTABLE TO JBG SMITH PROPERTIES | $ (69,831) | $ 21,014 | $ (57,851) | $ 49,344 |
Earnings Per Share [Abstract] | ||||
Basic (in dollars per share) | $ (0.61) | $ 0.21 | $ (0.55) | $ 0.49 |
Diluted (in dollars per share) | $ (0.61) | $ 0.21 | $ (0.55) | $ 0.49 |
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - basic and diluted | 114,744 | 100,571 | 105,347 | 100,571 |
Condensed Combined Statement of
Condensed Combined Statement of Equity - 9 months ended Sep. 30, 2017 - USD ($) $ in Thousands | Total | Common Shares | Additional Paid-In Capital | Accumulated Deficit | Former Parent Equity | Noncontrolling Interests in Consolidated Subsidiaries | ||
BALANCE (beginning of period) at Dec. 31, 2016 | $ 2,121,984 | $ 2,121,689 | $ 295 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income (loss) attributable to JBG SMITH Properties | (57,851) | $ (28,827) | (29,024) | [1] | ||||
Deferred compensation shares and options, net | 1,526 | 1,526 | ||||||
Contributions from Vornado Realty Trust, net | 334,843 | 334,843 | ||||||
Issuance of common limited partnership units to Vornado Realty Trust at the separation | (96,632) | (96,632) | ||||||
Issuance of common shares to former parent at the Separation (in shares) | 94,736,000 | |||||||
Issuance of common shares at the Separation | 2,332,402 | [2] | $ 947 | $ 2,331,455 | (2,332,402) | |||
Issuance of common shares in connection with the Combination (in shares) | 23,221,000 | |||||||
Issuance of common shares in connection with the Combination | 864,918 | [2] | $ 233 | 864,685 | ||||
Noncontrolling interests acquired in connection with the Combination | 3,987 | 3,987 | ||||||
Distributions to noncontrolling interests | (14) | (14) | ||||||
Contributions from noncontrolling interests | 134 | 134 | ||||||
Adjustment to record redeemable noncontrolling interest at redemption value | $ (97,084) | (97,084) | ||||||
Common shares outstanding (in shares) at Sep. 30, 2017 | 117,957,000 | 117,957,000 | ||||||
BALANCE, (end of period) at Sep. 30, 2017 | $ 3,075,811 | $ 1,180 | $ 3,099,056 | $ (28,827) | $ 0 | $ 4,402 | ||
[1] | Net loss earned from January 1, 2017 through July 17, 2017 is attributable to our former parent as it was the sole shareholder prior to July 17, 2017. See Note 1 for additional information. | |||||||
[2] | See Note 3 for information about assets, liabilities and noncontrolling interests acquired in the Formation Transaction. |
Condensed Combined Statements 6
Condensed Combined Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | ||
OPERATING ACTIVITIES: | |||
Net (loss) income | $ (60,332) | $ 49,344 | |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | |||
Share-based compensation expense | 17,164 | 3,486 | |
Depreciation and amortization, including amortization of debt issuance costs | 111,684 | 99,612 | |
Deferred rent | (9,249) | (10,772) | |
Loss from unconsolidated real estate ventures | 1,365 | 952 | |
Amortization of above- and below-market lease intangibles, net | (872) | (1,012) | |
Return on capital from unconsolidated real estate ventures | 1,149 | 1,020 | |
Gain on bargain purchase | (27,771) | 0 | |
Loss on extinguishment of debt | 689 | 0 | |
Unrealized gain on interest rate swaps | (467) | 0 | |
Bad debt expense | 1,808 | 618 | |
Other non-cash items | 6,466 | 3,592 | |
Changes in operating assets and liabilities: | |||
Tenant and other receivables | (3,617) | (2,177) | |
Other assets, net | (32,884) | (19,762) | |
Accounts payable and accrued expenses | 19,077 | (4,091) | |
Other liabilities, net | (817) | (19,427) | |
Net cash provided by operating activities | 23,393 | 101,383 | |
INVESTING ACTIVITIES: | |||
Development costs, construction in progress and real estate additions | (115,922) | (185,439) | |
Cash received in connection with the Combination | 83,942 | 0 | |
Restricted cash | (798) | 3,234 | |
Investments in and advances to unconsolidated real estate ventures | (1,441) | (19,965) | |
Repayment of notes receivable | 50,934 | 0 | |
Other investments | (3,531) | (1,935) | |
Proceeds from repayment of receivable from former parent | 75,000 | 0 | |
Net cash provided by (used in) investing activities | 88,184 | (204,105) | |
FINANCING ACTIVITIES: | |||
Contributions from former parent, net | 160,203 | 32,955 | |
Repayment of borrowings from former parent | (115,630) | 0 | |
Capital lease payments | (17,776) | 0 | |
Proceeds from borrowings from former parent | 4,000 | 39,000 | |
Proceeds from borrowings | 407,769 | 0 | |
Repayments of borrowings | (192,681) | (8,871) | |
Debt issuance costs | (18,686) | (37) | |
Contributions from noncontrolling interests | 134 | 0 | |
Distributions to noncontrolling interests | (14) | (7) | |
Net cash provided by financing activities | 227,319 | 63,040 | |
Net increase (decrease) in cash and cash equivalents | 338,896 | (39,682) | |
Cash and cash equivalents at beginning of the period | 29,000 | 74,966 | |
Cash and cash equivalents at end of the period | 367,896 | 35,284 | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW AND NON-CASH INFORMATION: | |||
Transfer of mortgage payable to former parent | [1] | 0 | 115,022 |
Cash paid for interest (net of capitalized interest of $2,285 and $3,690 in 2017 and 2016, respectively) | [1] | 45,354 | 37,540 |
Accrued capital expenditures included in accounts payable and accrued expenses | [1] | 17,633 | 15,206 |
Write-off of fully depreciated assets | [1] | (24,909) | (87,220) |
Cash payments for income taxes | [1] | 3,681 | 1,087 |
Non-cash transactions related to the Formation Transaction: | |||
Issuance of common limited partnership units at the Separation | [1] | 96,632 | 0 |
Issuance of common shares at the Separation | [1] | 2,332,402 | 0 |
Issuance of common shares in connection with the Combination | [1] | 864,918 | 0 |
Issuance of common limited partnership units in connection with the Combination | [1] | 359,967 | 0 |
Adjustment to record redeemable noncontrolling interest at redemption value | [1] | 97,084 | 0 |
Contribution from former parent in connection with the Separation | [1] | $ 174,639 | $ 0 |
[1] | See Note 3 for information about assets, liabilities and noncontrolling interests acquired in the Formation Transaction. |
Condensed Combined Statements 7
Condensed Combined Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Statement of Cash Flows [Abstract] | ||
Capitalized interest | $ 2,285 | $ 3,690 |
Organization and Basis of Prese
Organization and Basis of Presentation and Combination | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation and Combination | Organization and Basis of Presentation Organization JBG SMITH Properties ("JBG SMITH") was organized by Vornado Realty Trust ("Vornado" or "former parent") 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 and liabilities (the "JBG Assets") of The JBG Companies (the "Combination"). The Separation and the Combination are collectively referred to as the "Formation Transaction." Unless the context otherwise requires, all references to "we," "us," and "our," refer to the Vornado Included Assets, our predecessor and accounting acquirer, for periods prior to the Separation and to JBG SMITH for periods from and after the Separation and Combination. 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 common limited partnership units ("OP Units") in JBG SMITH Properties LP ("JBG SMITH LP"), our operating partnership, on a pro rata basis to the holders of VRLP's 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 OP 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 OP Unit for every two common limited partnership units in VRLP held as of the close of business on the Record Date. Our operations are presented as if the transfer of the Vornado Included Assets had been consummated prior to all historical periods presented in the accompanying condensed consolidated and 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 OP Units to parties other than JBG SMITH. In connection with the Combination, JBG SMITH issued 23.3 million common shares and JBG SMITH LP issued 13.9 million OP Units to parties other than JBG SMITH. As of the completion of the Formation Transaction there were 118.0 million JBG SMITH common shares outstanding and 19.8 million JBG SMITH LP OP Units outstanding that were owned by parties other than JBG SMITH. As of July 18, 2017 and September 30, 2017 , we, as its sole general partner controlled JBG SMITH LP and owned 85.6% of its OP Units. We own and operate a portfolio of high-quality office and multifamily assets, many of which are amenitized with ancillary retail. Our portfolio reflects our longstanding strategy of concentrating in downtown Washington, DC and other leading urban-infill submarkets with proximity to downtown Washington, DC that have high barriers to entry and key urban amenities, including being within walking distance of a Metro station. As of September 30, 2017 , our portfolio comprised: (i) 69 operating assets comprising 51 office assets totaling over 13.7 million square feet ( 11.8 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) nine assets under construction comprising four office assets totaling approximately 1.3 million square feet ( 1.2 million square feet at our share), four multifamily assets totaling 1,334 units ( 1,149 units at our share) and one other asset totaling approximately 41,100 square feet ( 4,100 square feet at our share; (iii) one near-term development multifamily asset totaling 433 units ( 303 units at our share), and (iv) 42 future development assets totaling approximately 21.3 million square feet ( 17.6 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. In addition to our portfolio, we have a third-party real estate services business that provides fee-based real estate services to our real estate ventures, legacy funds formerly organized by JBG ("JBG Legacy Funds") and other third parties. Only the U.S. federal government accounted for 10% or more of our rental revenue for the three and nine months ended September 30, 2017 and 2016 , as follows: Three Months Ended September 30, Nine Months Ended September 30, (Dollars in thousands) 2017 2016 2017 2016 U.S. federal government $ 22,492 $ 27,594 $ 68,869 $ 74,939 Percentage of office segment revenue 22.6 % 30.5 % 25.3 % 28.5 % Percentage of total rental revenue 17.8 % 24.3 % 20.0 % 22.9 % Basis of Presentation The accompanying unaudited condensed consolidated and 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 and Article 10 of Regulation S-X. Accordingly, these unaudited condensed consolidated and combined financial statements do not contain certain information required in annual financial statements and notes as required under GAAP. In our opinion, all adjustments considered necessary for a fair presentation have been included, and all such adjustments are of a normal recurring nature. All intercompany transactions and balances have been eliminated. The results of operations for the three and nine months ended September 30, 2017 and 2016 are not necessarily indicative of the results that may be expected for a full year. These condensed consolidated and 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. The accompanying condensed consolidated and combined financial statements include the accounts of JBG SMITH and our wholly-owned subsidiaries and those other entities in which we have a controlling financial interest, including where we have been determined to be a primary beneficiary of a variable interest entity ("VIE"). See Note 6 for more information on our consolidated VIEs. The portions of the equity and net (loss) income of consolidated subsidiaries that are not attributable to JBG SMITH are presented separately as amounts attributable to noncontrolling interests in the condensed consolidated and combined financial statements. Combination JBG SMITH and the Vornado Included Assets were under common control of Vornado for all periods prior to the Separation at July 17, 2017. The transfer of the Vornado Included Assets from Vornado to JBG SMITH was completed prior to the Separation, at net book values (historical carrying amounts) carved out from Vornado’s books and records. For purposes of the formation of JBG SMITH, the Vornado Included Assets were designated as the predecessor and the accounting acquirer of JBG SMITH. Consequently, the financial statements of JBG SMITH, as set forth herein, represent a continuation of the financial information of the Vornado Included Assets as the predecessor and accounting acquirer such that the historical financial information included herein as of any date or for any periods on or prior to the completion of the Combination represents the pre-Combination financial information of the Vornado Included Assets. The financial statements reflect the common shares as of the date of the Separation as outstanding for all prior periods prior to July 17, 2017. The acquisition of the management business and certain assets and liabilities of JBG completed subsequently by JBG SMITH was accounted for as a business combination using the acquisition method whereby identifiable assets acquired and liabilities assumed are recorded at the acquisition-date fair values and income and cash flows from the operations were consolidated into the financial statements of JBG SMITH commencing July 18, 2017. The accompanying condensed consolidated and combined statements of operations for the three and nine months ended September 30, 2017 include our consolidated accounts and the combined accounts of the Vornado Included Assets. Accordingly, the results of operations for the three and nine months ended September 30, 2017 reflect the aggregate operations and changes in cash flows and equity on a combined basis for all periods prior to July 17, 2017 and on a consolidated basis for all periods subsequent to July 17, 2017. The accompanying condensed combined financial statements for the three and nine months ended September 30, 2016 include the Vornado Included Assets. 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. References to the financial statements refer to our condensed consolidated and combined financial statements as of September 30, 2017 and December 31, 2016 , and for the three and nine months ended September 30, 2017 and 2016 . References to the balance sheets refer to our condensed consolidated and combined balance sheets as of September 30, 2017 and December 31, 2016 . References to the statement of operations refer to our condensed consolidated and combined statements of operations for the three and nine months ended September 30, 2017 and 2016 . References to the statement of cash flows refer to our condensed consolidated and combined statements of cash flows for the nine months ended September 30, 2017 and 2016 . The historical financial results for the Vornado Included Assets reflect charges for certain corporate costs allocated by the former parent 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 17. Recasting of 2016 Financial Information The historical financial information of the Vornado Included Assets was recast to exclude Vornado's interest in Rosslyn Plaza as it was omitted from the Separation. Financial information disclosed herein as of any date or for any periods on or prior to the completion of the Separation represents such recast amounts. Reclassifications Certain prior period data have been reclassified to conform to the current period presentation as follows: • Reclassification of $4.0 million of investments to "Other assets" on our balance sheet as of December 31, 2016 as a result of the revision in the line item "Investments in and advances to unconsolidated real estate ventures" on our balance sheet to include only real estate investments. • Reclassification of $4.8 million and $14.3 million of expenses for the three and nine months ended September 30, 2016 , respectively, to “General and administrative: third-party real estate services” from “Property operating expenses” as it relates to known expenses incurred to operate our third-party real estate services. Additionally, we reclassified $2.0 million and $6.0 million of income for the three and nine months ended September 30, 2016 , respectively, to “Third-party real estate services, including reimbursements” from “Other income” as it relates to revenue earned from our third-party business. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Use of Estimates The preparation of the 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. Business Combinations We account for business combinations, including the acquisition of real estate, using the acquisition method by recognizing and measuring the identifiable assets acquired, liabilities assumed, and any noncontrolling interests in the acquiree at their acquisition date fair values. As a result, upon the acquisition, we estimate the fair value of the acquired tangible assets (consisting of real estate, cash and cash equivalents, tenant and other receivables, investments in unconsolidated real estate ventures and other assets, as applicable), identified intangible assets and liabilities (consisting of the value of in-place leases, above- and below-market leases, options to enter into ground lease and management contracts, as applicable), assumed debt and other liabilities, and noncontrolling interests, as applicable, based on our evaluation of information and estimates available at that date. Based on these estimates, we allocate the purchase price to the identified assets acquired and liabilities assumed. Any excess of the purchase price over the estimated fair value of the net assets acquired is recorded as goodwill. Any excess of the fair value of assets acquired over the purchase price is recorded as a gain on bargain purchase. If, up to one year from the acquisition date, information regarding the fair value of the net assets acquired and liabilities assumed is received and estimates are refined, appropriate adjustments are made on a prospective basis to the purchase price allocation, which may include adjustments to identified assets, assumed liabilities, and goodwill or the gain on bargain purchase, as applicable. Transaction costs related to business combinations are expensed as incurred and included in "Transaction and other costs" in our statements of operations. The fair values of tangible real estate assets are determined using the “as-if vacant” approach whereby we use discounted income, or cash flow models with inputs and assumptions that we believe are consistent with current market conditions for similar assets. The most significant assumptions in determining the allocation of the purchase price to tangible assets are the exit capitalization rate, discount rate, estimated market rents and hypothetical expected lease-up periods. The fair values of identified intangible assets are determined based on the following: • The value allocable to the above- or below-market component of an acquired in-place lease is determined based upon the present value (using a discount rate which reflects the risks associated with the acquired leases) of the difference between (i) the contractual amounts to be received pursuant to the lease over its remaining term and (ii) management’s estimate of the amounts that would be received using market rates over the remaining term of the lease. Amounts allocated to above- market leases are recorded as "Identified intangible assets" in "Other assets, net" in the balance sheets, and amounts allocated to below-market leases are recorded as "Lease intangible liabilities" in "Other liabilities, net" in the balance sheets. These intangibles are amortized to "Property rentals" in our statements of operations over the remaining terms of the respective leases. • Factors considered in determining the value allocable to in-place leases include estimates, during hypothetical lease-up periods, related to space that is actually leased at the time of acquisition. These estimates include (i) lost rent at market rates, (ii) fixed operating costs that will be recovered from tenants and (iii) theoretical leasing commissions required to execute similar leases. These intangible assets are recorded as "Identified intangible assets" in "Other assets, net" in the balance sheets and are amortized over the remaining term of the existing lease. • The fair value of the in-place property management, leasing, asset management, and development and construction management contracts is based on revenue and expense projections over the estimated life of each contract discounted using a market discount rate. These management contract intangibles are amortized over the weighted average life of the management contracts. The fair value of investments in unconsolidated real estate ventures and related noncontrolling interests is based on the estimated fair values of the identified assets acquired and liabilities assumed of each entity. The fair value of the mortgages payable assumed was determined using current market interest rates for comparable debt financings. The fair values of the interest rate swaps and caps are based on the estimated amounts we would receive or pay to terminate the contract at the reporting date and are determined using interest rate pricing models and observable inputs. The carrying value of cash, restricted cash, working capital balances, leasehold improvements and equipment, and other assets acquired and liabilities assumed approximates fair value. The results of operations of acquisitions are included in our financial statements as of the dates they are acquired. The intangible assets and liabilities associated with acquisitions are included in "Other assets, net" and "Other liabilities, net", respectively, in our balance sheets. Real Estate Real estate is carried at cost, net of accumulated depreciation and amortization. Maintenance and repairs are expensed as incurred. As real estate is undergoing redevelopment activities, all property operating expenses directly associated with and attributable to the redevelopment, including interest expense, are capitalized to the extent that we believe such costs are recoverable through the value of the property. The capitalization period begins when redevelopment activities are underway and ends when the project is substantially complete. General and administrative costs are expensed as incurred. Depreciation requires an estimate by management of the useful life of each property and improvement as well as an allocation of the costs associated with a property to its various components. Depreciation is recognized on a straight‑line basis over estimated useful lives, which range from three to 40 years . Tenant allowances are amortized on a straight‑line basis over the lives of the related leases, which approximate the useful lives of the tenant improvements. Construction in progress, including land, is carried at cost, and no depreciation is recorded. Real estate undergoing significant renovations and improvements is considered under development. All direct and indirect costs related to development activities are capitalized into "Construction in progress, including land" on our balance sheets, except for certain demolition costs, which are expensed as incurred. Costs incurred include pre-development expenditures directly related to a specific project, development and construction costs, interest, insurance and real estate taxes. Indirect development costs include employee salaries and benefits, travel and other related costs that are directly associated with the development real estate. Our method of calculating capitalized interest expense is based upon applying our weighted average borrowing rate to the actual accumulated expenditures if the property does not have property specific debt. The capitalization of such expenses ceases when the real estate is ready for its intended use, but no later than one-year from substantial completion of major construction activity. If we determine that a project is no longer viable, all pre-development project costs are immediately expensed. Similar costs related to properties not under development are expensed as incurred. Our assets and related intangible assets are individually reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. An impairment exists when the carrying amount of an asset exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. Estimates of future cash flows are based on our current plans, intended holding periods and available market information at the time the analyses are prepared. An impairment loss is recognized only if the carrying amount of the asset is not recoverable and is measured based on the excess of the property’s carrying amount over its estimated fair value. If our estimates of future cash flows, anticipated holding periods, or fair values change, based on market conditions or otherwise, our evaluation of impairment charges may be different and such differences could be material to our financial statements. Estimates of future cash flows are subjective and are based, in part, on assumptions regarding future occupancy, rental rates and capital requirements that could differ materially from actual results. Real Estate Held for Sale Real estate held for sale is recorded at the lower of the carrying amount or the expected sales price less costs to sell. Operations of real estate held for sale and real estate sold are reported in continuing operations if their disposition does not represent a strategic shift that has or will have a major effect on our operations and financial results. The application of the accounting principles that govern the classification any of our real estate as held for sale requires management to make certain significant judgments. In evaluating whether real estate meets the held for sale criteria set forth by the Property, Plant and Equipment Topic of the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC"), we make a determination as to the point in time that it is probable that a sale will be consummated. Given the nature of all real estate sales contracts, it is not unusual for such contracts to allow potential buyers a period of time to evaluate the property prior to formal acceptance of the contract. In addition, certain other matters critical to the final sale, such as financing arrangements, often remain pending even upon contract acceptance. As a result, real estate under contract may not close within the expected time period or may not close at all. Therefore, any real estate categorized as held for sale represents only those properties that management has determined are probable to close within the requirements set forth in the Property, Plant and Equipment Topic of the FASB ASC. We do not have any real estate classified as held for sale as of September 30, 2017 and December 31, 2016 . Cash and Cash Equivalents Cash and cash equivalents consist of highly liquid investments with original maturities of three months or less and are carried at cost, which approximates fair value, due to their short‑term maturities. Restricted Cash Restricted cash consists primarily of security deposits held on behalf of our tenants, cash escrowed under loan agreements for debt service, real estate taxes, property insurance and capital improvements. Allowance for Doubtful Accounts We periodically evaluate the collectability of amounts due from tenants, including the receivable arising from deferred rent receivable, and maintain an allowance for doubtful accounts for the estimated losses resulting from the inability of tenants to make required payments under lease agreements. We exercise judgment in establishing these allowances and consider payment history and current credit status in developing these estimates. Investments in and Advances to Real Estate Ventures We analyze our real estate ventures to determine whether the respective entities should be consolidated. If it is determined that these investments do not require consolidation because the entities are not VIEs in accordance with the Consolidation Topic of the FASB ASC, we are not considered the primary beneficiary of the entities determined to be VIEs, we do not have voting control, and/or the limited partners (or non-managing members) have substantive participatory rights, then the selection of the accounting method used to account for our investments in unconsolidated real estate ventures is generally determined by our voting interests and the degree of influence we have over the entity. Management uses its judgment when determining if we are the primary beneficiary of, or have a controlling financial interest in, an entity in which we have a variable interest. Factors considered in determining whether we have the power to direct the activities that most significantly impact the entity’s economic performance include risk and reward sharing, experience and financial condition of the other partners, voting rights, involvement in day-to-day capital and operating decisions and the extent of our involvement in the entity. We use the equity method of accounting for investments in unconsolidated real estate ventures when we own 20% or more of the voting interests and have significant influence but do not have a controlling financial interest, or if we own less than 20% of the voting interests but have determined that we have significant influence. Under the equity method, we record our investments in and advances to these entities in our balance sheets, and our proportionate share of earnings or losses earned by the real estate venture is recognized in "(Loss) income of unconsolidated real estate ventures" in the accompanying statements of operations. We earn revenues from the management services we provide to unconsolidated entities. These fees are determined in accordance with the terms specific to each arrangement and may include property and asset management fees or transactional fees for leasing, acquisition, development and construction, financing, and legal services provided. We account for this revenue gross of our ownership interest in each respective real estate venture and recognize such revenue in "Third-party real estate services, including reimbursements" in our statements of operations. Our proportionate share of related expenses is recognized in "(Loss) income of unconsolidated real estate ventures" in our statements of operations. We may also earn incremental promote distributions if certain financial return benchmarks are achieved upon ultimate disposition of the underlying properties. Management fees are recognized when earned, and promote fees are recognized when certain earnings events have occurred, and the amount is determinable and collectible. Any promote fees are reflected in "(Loss) income from unconsolidated real estate ventures" in our statements of operations. On a periodic basis, we evaluate our investments in unconsolidated entities for impairment. We assess whether there are any indicators, including underlying property operating performance and general market conditions, that the value of our investments in unconsolidated real estate ventures may be impaired. An investment in a real estate venture is considered impaired only if we determine that its fair value is less than the net carrying value of the investment in that real estate venture on an other-than-temporary basis. Cash flow projections for the investments consider property level factors such as expected future operating income, trends and prospects, as well as the effects of demand, competition and other factors. We consider various qualitative factors to determine if a decrease in the value of our investment is other-than-temporary. These factors include age of the venture, our intent and ability to retain our investment in the entity, financial condition and long-term prospects of the entity and relationships with our partners and banks. If we believe that the decline in the fair value of the investment is temporary, no impairment charge is recorded. If our analysis indicates that there is an other-than temporary impairment related to the investment in a particular real estate venture, the carrying value of the venture will be adjusted to an amount that reflects the estimated fair value of the investment. Intangibles Intangible assets consist of in-place leases, below-market ground rent obligations, above-market real estate leases, lease origination costs and options to enter into ground lease that were recorded in connection with the acquisition of properties. Intangible assets also include management and leasing contracts acquired as part of the Combination. Intangible liabilities consist of above-market ground rent obligations and below-market real estate leases that are also recorded in connection with the acquisition of properties. Both intangible assets and liabilities are amortized and accreted using the straight-line method over their applicable remaining useful life. When a lease or contract is terminated early, any remaining unamortized or unaccreted balances are charged to earnings. The useful lives of intangible assets are evaluated each reporting period with any changes in estimated useful lives being accounted for over the revised remaining useful life. Deferred Costs Deferred financing costs consist of loan issuance costs directly related to financing transactions that are deferred and amortized over the term of the related loan as a component of interest expense. Unamortized deferred financing costs related to our mortgages payable and unsecured term loan are presented as a direct deduction from the carrying amounts of the related debt instruments, while such costs related to our revolving credit facility are included in other assets. Direct salaries, third-party fees and other costs incurred by us to originate a lease are capitalized in "Other assets, net" in the balance sheets and are amortized against the respective leases using the straight-line method over the term of the related leases. Noncontrolling Interests Redeemable noncontrolling interests consists of OP Units issued in conjunction with the Formation Transaction. The OP Units are redeemable for our common shares or cash beginning August 1, 2018, subject to certain limitations. Redeemable noncontrolling interests are generally redeemable at the option of the holder and are presented in the mezzanine section between total liabilities and shareholders' equity on the balance sheets. The carrying amount of redeemable noncontrolling interests is adjusted to its redemption value at the end of each reporting period, but no less than its initial carrying value, with such adjustments recognized in "Additional paid-in capital". Noncontrolling interests in consolidated subsidiaries represents the portion of equity that we do not own in entities we consolidate, including interests in consolidated real estate ventures or VIEs in connection with property acquisitions. We identify our noncontrolling interests separately within the equity section on the balance sheets. See Note 10 for further information. Amounts of consolidated net (loss) income attributable to redeemable noncontrolling interests and to the noncontrolling interests in consolidated subsidiaries are presented separately in the statements of operations. Derivative Financial Instruments and Hedge Accounting Derivative financial instruments are used at times to manage exposure to variable interest rate risk. Derivative financial instruments, consisting of interest rate swaps and caps, are considered economic hedges, but not designated as accounting hedges, and are carried at their estimated fair value on a recurring basis. Realized and unrealized gains are recorded in "Interest and other (loss) income, net" in the statements of operations in the period in which the change occurs. Fair Value of Assets and Liabilities 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. Revenue Recognition Property rentals income includes base rents that each tenant pays in accordance with the terms of its respective lease and is reported on a straight-line basis over the non-cancellable term of the lease, which includes the effects of periodic step-ups in rent and rent abatements under the leases. We commence rental revenue recognition when the tenant takes possession of the leased space or controls the physical use of the leased space and the leased space is substantially ready for its intended use. In circumstances where we provide a tenant improvement allowance for improvements that are owned by the tenant, we recognize the allowance as a reduction of property rentals revenue on a straight-line basis over the term of the lease. Differences between rental income recognized and amounts due under the respective lease agreements are recorded as an increase or decrease to “Deferred rent receivable, net” on our balance sheets. Property rentals also includes the amortization of acquired above-and below-market leases, net. Tenant reimbursements provide for the recovery of all or a portion of the operating expenses and real estate taxes of the respective assets. Tenant reimbursements are accrued in the same periods as the related expenses are incurred. Third-party real estate services revenue, including reimbursements, is determined in accordance with the terms specific to each arrangement and may include property and asset management fees or transactional fees for leasing, acquisition, development and construction, financing, and legal services provided. These fees are determined in accordance with the terms specific to each arrangement and are recognized as the related services are performed. Development and construction fees earned from providing services to our unconsolidated real estate joint ventures are recorded on a percentage of completion basis. Third-Party Real Estate Services Expenses Third-party real estate services expenses include the costs associated with the management services provided to our unconsolidated real estate joint ventures and other third parties. We allocate personnel and other overhead costs using the estimates of the time spent performing services for our third-party business and other allocation methodologies. Income Taxes We intend to elect to be taxed as a REIT under sections 856-860 of the Internal Revenue Code of 1986, as amended (the "Code"), commencing with the filing of our tax return for the 2017 calendar year, effective for our tax year ending December 31, 2017. 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. Prior to the Separation, the Vornado Included Assets historically operated under Vornado’s REIT structure. 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 financial statements for the periods prior to the Separation. We intend to continue to adhere to these requirements and maintain our REIT status in future periods. As a REIT, we are allowed to reduce taxable income by all or a portion of our distributions to shareholders. Future distributions will be declared and paid at the discretion of the Board of Trustees and will depend upon cash generated by operating activities, our financial condition, capital requirements, annual dividend requirements under the REIT provisions of the Code, as amended, and such other factors as our Board of Trustees deems relevant. We also participate in certain activities conducted by entities which elected to be treated as taxable REIT subsidiaries ("TRS") under the Code. As such, we are subject to federal, state, and local taxes on the income from these activities. Income taxes attributable to our TRSs are accounted for under the asset and liability method. Under the asset and liability method, deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements, which will result in taxable or deductible amounts in the future. ASC 740-10, Income Taxes, provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. ASC 740-10 requires the evaluation of tax positions taken in the course of preparing our tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. Tax benefits of positions not deemed to meet the more-likely-than-not threshold are recorded as a tax expense in the current year. As of September 30, 2017 , and December 31, 2016 , we determined that no liabilities are required in connection with uncertain tax positions. (Loss) Earnings Per Share Basic (loss) earnings per common share ("EPS") is computed by dividing net (loss) income attributable to common shareholders by the weighted average common shares outstanding during the period. Unvested and vested share-based payment awards that entitle holders to receive non-forfeitable dividends, which include OP Units, long-term incentive partnership units ("LTIP Units") and out-performance award units ("OPP Units"), are considered participating securities. Consequently, we are required to apply the two-class method of computing basic and diluted earnings that would otherwise have been available to common shareholders. Under the two-class method, earnings for the period are allocated between common shareholders and participating securities based on their respective rights to receive dividends. During periods of net loss, losses are allocated only to the extent the participating securities are required to absorb their share of such losses. Diluted earnings per common share reflects the potential dilution of the assumed exchange of various units into common shares unvested share-based payment awards to the extent they are dilutive. Share-Based Compensation We granted OP Units, formation awards ("Formation Awards"), LTIP Units and OPP Units to our trustees, management and employees in connection with the Separation and Combination. The term and vesting of each award were determined by the compensation committee of our Board of Trustees (the “Compensation Committee”). Fair value is determined, depending on the type of award, using the Monte Carlo method or post-vesting restriction periods, which is intended to estimate the fair value of the awards at the grant date using dividend yields and expected volatilities that are primarily based on available implied data and peer group companies' historical data. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The shortcut method is used for determining the expected life used in the valuation method. Compensation expense for the Formation Awards, LTIP Units, OPP Units and certain OP Units is based on the fair value of our common shares at the date of the grant and is recognized ratably over the vesting period. For grants with a graded vesting schedule that are only subject to service conditions, we have elected to recognize compensation expense on a straight-line basis. We also elected to account for forfeitures as they occur, rather than estimate expected forfeitures. Distributions paid on unvested OP Units, LTIPs and OPPs are charged to “net income attributable to noncontrolling interests” in the statements of operations. Recent Accounting Pronouncements The following table provides a brief description of recent accounting pronouncements (Accounting Standards Update or "ASU") by the 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 Standard adopted 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. September 2017 The adoption and implementation of this standard did not have an impact on our results of operations, financial condition or cash flows. Standard Description Date of Adoption Effect on the Financial Statements or Other Significant Matters Standards not yet adopted ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities The standard provides new guidance for the determination of eligibility for hedge accounting and effectiveness. It also amends the presentation and disclosure requirements. ASU 2017-12 requires a modified retrospective transition method which requires the recognition of the cumulative effect of the change on the opening balance of each affected component of equity in the statement of financial position as of the date of adoption. January 2019 We are currently evaluating the overall impact of the adoption of ASU 2017-12. The adoption of this standard is not expected to have a material impact on our financial statements. 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 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 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 a material impact on our financial statements. 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 retrospect |
The Combination
The Combination | 9 Months Ended |
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
The Combination | The Combination On July 18, 2017, we completed the Combination and acquired the JBG Assets in exchange for approximately 37.2 million common shares and OP Units. The Combination has been accounted for at fair value under the acquisition method of accounting. The following allocation of the purchase price is based on preliminary estimates and assumptions and is subject to change based on a final determination of the assets acquired and liabilities assumed (in thousands): Fair value of purchase consideration: Common shares and OP Units $ 1,224,886 Cash 20,573 Total consideration paid $ 1,245,459 Fair value of assets acquired and liabilities assumed: Land and improvements $ 342,932 Building and improvements 623,889 Construction in progress, including land 632,664 Leasehold improvements and equipment 7,890 Cash 104,516 Restricted cash 13,460 Investments in and advances to unconsolidated real estate ventures 238,388 Identified intangible assets 146,600 Notes receivable (1) 50,934 Identified intangible liabilities (8,449 ) Mortgages payable assumed (2) (768,523 ) Capital lease obligations assumed (3) (33,543 ) Deferred tax liability (4) (21,476 ) Other liabilities acquired, net (52,065 ) Noncontrolling interests in consolidated subsidiaries (3,987 ) Net assets acquired 1,273,230 Gain on bargain purchase (5) 27,771 Total consideration paid $ 1,245,459 ____________________ (1) During the three months ended September 30, 2017 , we received proceeds of $50.9 million from the repayment of the notes receivable acquired as part of the Combination. (2) Subject to various interest rate swap and cap agreements assumed in the Combination that are considered economic hedges, but not designated as accounting hedges. (3) As part of the Combination, two ground leases were assumed that were capital leases. On July 25, 2017, we purchased a land parcel located in Reston, Virginia associated with one of the ground leases for $19.5 million . (4) Related to the management and leasing contracts acquired in the Combination. (5) The Combination resulted in a gain on bargain purchase because the estimated fair value of the identifiable net assets acquired exceeded the purchase consideration by $27.8 million . The purchase consideration was based on the fair value of the common shares and OP Units issued in the Combination. We continue to reassess the recognition and measurement of identifiable assets and liabilities acquired and have preliminarily concluded that all acquired assets and liabilities were recognized and that the valuation procedures and resulting estimates of fair values were appropriate. The fair value of the common shares and OP Units purchase consideration was determined as follows (i n thousands, except exchange ratio and price per share/unit): Outstanding common shares and common limited partnership units prior to the Combination 100,571 Exchange ratio (1) 2.71 Common shares and OP Units issued in consideration 37,164 Price per share/unit (2) $ 37.10 Fair value of common shares and OP Units issued in consideration $ 1,378,780 Fair value adjustment to OP Units due to transfer restrictions (43,303 ) Portion of consideration attributable to performance of future services (3) (110,591 ) Fair value of common shares and OP Units purchase consideration $ 1,224,886 ____________________ (1) Represents the implied exchange ratio of one common share and OP Unit of JBG SMITH for 2.71 common shares and common limited partnership units prior to the Combination. (2) Represents the volume weighted average share price on July 18, 2017. (3) OP Unit consideration paid to certain of the owners of the JBG Assets which have an estimated fair value of $ 110.6 million is subject to post-combination employment with vesting over periods of either 12 or 60 months. In accordance with GAAP, consideration that is subject to future employment is not considered a component of the purchase price for the business combination and amortization is recognized as compensation expense over the period of employment and is included in "General and administrative expense: share-based compensation related to Formation Transaction" in the statements of operations. 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 serve on our Board of Trustees. The fair values of the depreciable tangible and identified intangible assets and liabilities, all of which have definite lives and are amortized, are as follows: Total Fair Value Weighted Average Amortization Period Useful Life (1) (In thousands) (In years) Tangible assets: Building and improvements $ 559,042 3 - 40 years Tenant improvements 64,847 Shorter of useful life or remaining life of the respective lease Total building and improvements $ 623,889 Leasehold improvements $ 4,422 Shorter of useful life or remaining life of the respective lease Identified intangible assets: In-place leases $ 59,351 6.4 Remaining life of the respective lease Above-market real estate leases 11,700 6.3 Remaining life of the respective lease Below-market ground leases 659 88.5 Remaining life of the respective lease Option to enter into ground lease 17,090 N/A Remaining life of contract Management and leasing contracts (2) 57,800 7.4 Estimated remaining life of contracts, ranging between 3 - 8 years Total identified intangible assets $ 146,600 Identified intangible liabilities: Below-market real estate leases $ 8,449 10.2 Remaining life of the respective lease ____________________ (1) In determining these useful lives, we considered the length of time the asset had been in existence, the maintenance history, as well as anticipated future maintenance, and any contractual stipulations that might limit the useful life. (2) Includes in-place property management, leasing, asset management, and development and construction management contracts. Transaction costs (such as advisory, legal, accounting, valuation and other professional fees) incurred to effect the Formation Transaction are included in "Transaction and other costs" in our statements of operations. We expensed a total of $121.6 million transaction and other costs, of which $104.1 million and $115.2 million were incurred during the three and nine months ended September 30, 2017 , and $1.5 million was incurred for both the three and nine months ended September 30, 2016 . For the three and nine months ended September 30, 2017 , transaction and other costs include severance and transaction bonus expense of $34.3 million , investment banking fees of $33.6 million , legal fees of $13.1 million and accounting fees of $8.1 million . The total revenue of the JBG Assets for the three and nine months ended September 30, 2017 included in our statements of operations from the acquisition date was $34.9 million . The net loss of the JBG Assets for the three and nine months ended September 30, 2017 included in our statements of operations from the acquisition date was $7.8 million . The accompanying unaudited pro forma information for the three and nine months ended September 30, 2017 and 2016 is presented as if the Formation Transaction had occurred on January 1, 2016. This pro forma information is based upon the historical financial statements and should be read in conjunction with our consolidated and combined financial statements and notes thereto included in our Registration Statement on Form 10, as amended, filed with the SEC and declared effective on June 26, 2017. This unaudited pro forma information does not purport to represent what the actual results of our operations would have been, nor does it purport to predict the results of operations of future periods. The unaudited pro forma information for the three and nine months ended September 30, 2017 and 2016 was adjusted to exclude $27.8 million of gain on bargain purchase. The unaudited pro forma information was adjusted to exclude transaction and other costs of $104.1 million and $115.2 million for the three and nine months ended September 30, 2017 , respectively, and $1.5 million for the three and nine months ended September 30, 2016 . Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) (In thousands) Unaudited pro forma information: Total revenue $ 160,428 $ 170,498 $ 481,314 $ 492,874 Net income (loss) attributable to JBG SMITH Properties $ 2,283 $ 803 $ (13,741 ) $ (26,701 ) Earnings (loss) per common share: Basic $ 0.02 $ 0.01 $ (0.13 ) $ (0.27 ) Diluted $ 0.02 $ 0.01 $ (0.13 ) $ (0.27 ) |
Tenants and Other Receivables,
Tenants and Other Receivables, Net | 9 Months Ended |
Sep. 30, 2017 | |
Receivables [Abstract] | |
Tenant and Other Receivables, Net | Tenant and Other Receivables, Net The following is a summary of tenant and other receivables, net as of September 30, 2017 and December 31, 2016 : September 30, December 31, (In thousands) Tenants $ 32,106 $ 26,278 Other 23,835 11,314 Allowance for doubtful accounts (5,467 ) (4,212 ) Total tenant and other receivables, net $ 50,474 $ 33,380 We incurred bad debt expense of approximately $1.1 million and $1.8 million during the three and nine months ended September 30, 2017 , respectively, and $106,000 and $618,000 during the three and nine months ended September 30, 2016 , respectively, which is included in "Property operating expenses" in the statement of operations. |
Investments in Unconsolidated R
Investments in Unconsolidated Real Estate Ventures | 9 Months Ended |
Sep. 30, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments in Unconsolidated Real Estate Ventures | Investments in and Advances to Unconsolidated Real Estate Ventures The following is a summary of the composition of our investments in and advances to unconsolidated real estate ventures as of September 30, 2017 and December 31, 2016 : Ownership Interest (1) Investment Balance Real Estate Venture Partners (1) September 30, September 30, December 31, (In thousands) Landmark 1.8% - 59.0% $ 110,562 $ — CBREI Venture 5.0% - 64.0% 85,386 — Canadian Pension Plan Investment Board 55.0% 36,223 36,312 Brandywine 30.0% 13,753 — Berkshire Group 50.0% 27,647 — MRP Realty 70.0% 1,802 — JP Morgan 5.0% 9,351 9,335 Other 242 129 Total investments in unconsolidated real estate ventures 284,966 45,776 Advances to unconsolidated real estate ventures 20 — Total investments in and advances to unconsolidated real estate ventures $ 284,986 $ 45,776 _______________ (1) We classify our investments in and advances to unconsolidated real estate ventures by real estate venture partner with which we may have multiple investments with varying ownership interests. The following is a summary of the debt of our unconsolidated real estate ventures as of September 30, 2017 and December 31, 2016 : Weighted Average Interest Rate Balance as of September 30, September 30, December 31, (In thousands) Variable rate (1) 4.08% $ 531,989 $ 31,000 Fixed rate (2) 3.90% 643,801 273,000 Unconsolidated real estate ventures - mortgages payable 1,175,790 304,000 Unamortized deferred financing costs, net (860 ) (1,034 ) Unconsolidated real estate ventures - mortgages payable, net $ 1,174,930 $ 302,966 ______________ (1) Includes variable rate mortgages payable with interest rate caps. (2) Includes variable rate mortgages payable with interest rates effectively fixed pursuant to interest rate swaps. The following is a summary of the financial information for our unconsolidated real estate ventures, as of September 30, 2017 and December 31, 2016 and for the three and nine months ended September 30, 2017 and 2016 : September 30, December 31, 2016 Combined balance sheet information: (In thousands) Total assets $ 3,446,348 $ 598,239 Total liabilities 1,253,664 327,862 Noncontrolling interests 343 343 Total equity 2,192,341 270,034 Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Combined income statement information: (In thousands) Total revenue $ 46,830 $ 16,364 $ 83,387 $ 51,066 Net (loss) income (5,191 ) 2,607 (414 ) 5,083 |
Variable Interest Entities
Variable Interest Entities | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | Variable Interest Entities Unconsolidated VIEs As of September 30, 2017 and December 31, 2016 , we have interests in several investments that are deemed VIEs that are in development stage and do not hold sufficient equity at risk or conduct substantially all their operations on behalf of the investor with disproportionately few voting rights. Although we are engaged to act as the managing partner in charge of day-to-day operations of these investees, we are not the primary beneficiary of these VIEs as we do not hold unilateral power over activities that, when taken together, most significantly impact the respective VIE’s performance. We account for our investment in these entities under the equity method. As of September 30, 2017 and December 31, 2016 , the net carrying amounts of our investment in these entities were $203.0 million and $42.4 million , respectively. Our maximum exposure to loss in these entities is limited to our investments, construction commitments and debt guarantees. See Note 16 for additional information. Consolidated VIEs JBG SMITH LP, our operating partnership, is our most significant consolidated VIE. We hold the majority membership interest in the operating partnership, act as the general partner and exercise full responsibility, discretion and control over its day-to-day management. The noncontrolling interests of the operating partnership do not have either substantive liquidation rights, or substantive kick-out rights without cause, or substantive participating rights that could be exercised by a simple majority of noncontrolling interest members (including by such a member unilaterally). Because the noncontrolling interest holders do not have these rights, the operating partnership is a VIE. As general partner, we have the power to direct the core activities of the operating partnership that most significantly affect its performance, and through our majority interest in the operating partnership have both the right to receive benefits from and the obligation to absorb losses of the operating partnership. Accordingly, we are the primary beneficiary of the operating partnership and consolidate the operating partnership in our financial statements. As we conduct our business and hold our assets and liabilities through the operating partnership, the total assets and liabilities of the operating partnership comprise substantially all of our consolidated assets and liabilities. We also consolidate certain VIEs that have minimal noncontrolling interests (less than 5%). These entities are VIEs because the noncontrolling interests do not have substantive kick-out or participating rights. We consolidate these entities because we control all of their significant business activities. As of September 30, 2017 , the total assets and liabilities of such consolidated VIEs, excluding the operating partnership, were approximately $78.8 million and $5.1 million , respectively. |
Other Assets, Net
Other Assets, Net | 9 Months Ended |
Sep. 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 September 30, 2017 and December 31, 2016 : September 30, December 31, (In thousands) Deferred leasing costs $ 168,344 $ 157,258 Accumulated amortization (66,403 ) (57,910 ) Deferred leasing costs, net 101,941 99,348 Prepaid expenses 21,942 2,199 Identified intangible assets, net 143,000 3,063 Other 21,508 8,345 Total other assets, net $ 288,391 $ 112,955 The following is a summary of the composition of identified intangible assets, net as of September 30, 2017 and December 31, 2016 : September 30, December 31, Identified intangible assets: (in thousands) In-place leases $ 72,081 $ 12,777 Above-market real estate leases 12,473 773 Below-market ground leases 2,874 2,215 Option to enter into ground lease 17,090 — Management and leasing contracts 57,800 — Other 206 206 Total identified intangibles assets 162,524 15,971 Accumulated amortization: In-place leases 15,187 10,871 Above-market real estate leases 1,082 612 Below-market ground leases 1,344 1,278 Management and leasing contracts 1,753 — Other 158 147 Total accumulated amortization 19,524 12,908 Identified intangible assets, net $ 143,000 $ 3,063 The following is a summary of amortization expense included in the statements of operations related to identified intangible assets for the three and nine months ended September 30, 2017 and 2016 : Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (in thousands) In-place lease amortization (1) $ 4,104 $ 233 $ 4,347 $ 336 Above-market real estate lease amortization (2) 448 20 471 64 Below-market ground lease amortization (3) 23 21 66 64 Management and leasing contract amortization (1) 1,753 — 1,753 — Other amortization (1) 3 22 10 69 Total identified intangible asset amortization $ 6,331 $ 296 $ 6,647 $ 533 ___________________________________________ (1) Amounts are included in "Depreciation and amortization expenses" in our statements of operations. (2) Amounts are included in "Property rentals revenue" in our statements of operations. (3) Amounts are included in "Property operating expenses" in our statements of operations. As of September 30, 2017 , the estimated amortization of identified intangible assets is as follows for each of the five years commencing January 1, 2018: Year ending December 31, Amount (in thousands) 2018 $ 15,119 2019 12,032 2020 10,105 2021 6,664 2022 5,312 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Debt | Debt Mortgages Payable The following is a summary of mortgages payable as of September 30, 2017 and December 31, 2016 : Weighted Average Interest Rate Balance as of September 30, September 30, December 31, (In thousands) Variable rate (1) 2.95% $ 1,152,106 $ 547,291 Fixed rate (2) 4.79% 836,141 620,327 Mortgages payable (3) 1,988,247 1,167,618 Unamortized deferred financing costs and premium/discount, net (10,573 ) (2,604 ) Mortgages payable, net $ 1,977,674 $ 1,165,014 Payable to former parent (4) — $ — $ 283,232 __________________________ (1) Includes variable rate mortgages payable with interest rate caps. (2) Includes variable rate mortgages payable with interest rates effectively fixed pursuant to rate swaps. (3) Includes mortgages payable assumed as part of the Combination. See Note 3 to the financial statements for additional information. (4) In June 2016, the mortgage loan for the Bowen Building was repaid with proceeds of a $115.6 million draw on our former parent's revolving credit facility collateralized by an interest in the property, and, accordingly, was reflected as a component of "Payable to former parent" on the combined balance sheets as of December 31, 2016 . We repaid the loan with amounts drawn under our revolving credit facility collateralized by a mortgage on the property. As of September 30, 2017 , the net carrying value of real estate collateralizing our mortgages payable totaled $3.9 billion . Our mortgage loans contain covenants that limit our ability to incur additional indebtedness on these properties and in certain circumstances, require lender approval of tenant leases and/or yield maintenance upon repayment prior to maturity. As of September 30, 2017 , we were in compliance with all debt covenants. As part of the Combination, we assumed mortgages payable with an aggregate principal balance of $768.5 million . During the three months ended September 30, 2017 , we repaid mortgages payable with an aggregate principal balance of $181.7 million , which includes mortgages payable totaling $63.7 million assumed in the Combination. We recognized losses on extinguishment of debt in conjunction with these repayments of $689,000 for the three and nine months ended September 30, 2017 . Credit Facility On July 18, 2017, we entered into a $1.4 billion credit facility, consisting of a $1.0 billion revolving credit facility maturing in July 2021 , with two six -month extension options, a delayed draw $200.0 million unsecured term loan ("Tranche A-1 Term Loan") maturing in January 2023 and a delayed draw $200.0 million unsecured term loan ("Tranche A-2 Term Loan") maturing in July 2024 . The interest rate for the credit facility varies based on a ratio of our total outstanding indebtedness to a valuation of certain real property and assets and ranges (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-1 Term Loan. In connection with the execution of the credit facility, we incurred $11.2 million in fees and expenses. The following is a summary of amounts outstanding under the credit facility as of September 30, 2017 : Interest Rate Balance as of September 30, September 30, (In thousands) Revolving credit facility (1) 2.34% $ 115,751 Tranche A-1 Term Loan 2.44% $ 50,000 Unamortized deferred financing costs, net (3,611 ) Unsecured term loan, net $ 46,389 __________________________ (1) As of September 30, 2017 , letters of credit with an aggregate face amount of $5.2 million were provided under our revolving credit facility. Principal Maturities Principal maturities of debt outstanding as of September 30, 2017 , including mortgages payable, the Tranche A-1 Term Loan and borrowings on the revolving credit facility, are as follows: Year ending December 31, Amount (In thousands) 2017 $ — 2018 376,019 2019 227,919 2020 215,096 2021 215,592 2022 327,500 Thereafter 791,872 Total $ 2,153,998 |
Other Liabilities, Net
Other Liabilities, Net | 9 Months Ended |
Sep. 30, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities, Net | Other Liabilities, Net The following is a summary of other liabilities, net as of September 30, 2017 and December 31, 2016 : September 30, December 31, (In thousands) Lease intangible liabilities $ 44,965 $ 36,515 Accumulated amortization (26,287 ) (24,945 ) Lease intangible liabilities, net 18,678 11,570 Prepaid rent 12,445 9,163 Lease assumptions liabilities and accrued tenant incentives 12,090 14,907 Capital lease obligation 15,976 — Security deposits 13,795 10,324 Ground lease deferred rent payable 3,559 3,331 Deferred tax liability (1) 22,007 — Other 2,224 192 Total other liabilities, net $ 100,774 $ 49,487 ___________________________________________ (1) As of September 30, 2017 , the deferred tax liability of $22.0 million is related to the management and leasing contracts assumed in the Combination. See Note 3 for additional information. The following is a summary of amortization expense included in the statements of operations related to lease intangible liabilities: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (in thousands) Lease intangible liabilities amortization (1) $ 633 $ 359 $ 1,343 $ 1,076 ___________________________________________ (1) Amounts are included in "Property rentals" in our statements of operations. As of September 30, 2017 , the estimated amortization of lease intangible liabilities is as follows for each of the five years commencing January 1, 2018: Year ending December 31, Amount (in thousands) 2018 $ 2,765 2019 2,679 2020 2,392 2021 1,917 2022 1,798 |
Redeemable Noncontrolling Inter
Redeemable Noncontrolling Interests | 9 Months Ended |
Sep. 30, 2017 | |
Noncontrolling Interest [Abstract] | |
Redeemable Noncontrolling Interests | Redeemable Noncontrolling Interests In conjunction with the Formation Transaction, JBG SMITH LP issued 19.8 million OP Units to persons other than JBG SMITH that are redeemable for cash or our common shares beginning August 1, 2018, subject to certain limitations. These OP Units represent a 14.4% interest in JBG SMITH LP as of September 30, 2017 . The carrying amount of the redeemable noncontrolling interests is adjusted to its redemption value at the end of each reporting period, but no less than its initial carrying value, with such adjustments recognized in "Additional paid-in capital". Redemption value is equivalent to the market value of one of our common shares at the end of the period multiplied by the number of vested OP Units outstanding. Below is a summary of the activity of redeemable noncontrolling interests for the nine months ended September 30, 2017 : Nine Months Ended September 30, 2017 (In thousands) Balance at January 1, 2017 (1) $ — OP Units issued at the Separation 96,632 OP Units issued in connection with the Combination (2) 359,967 Net loss attributable to redeemable noncontrolling interests (2,481 ) Share-based compensation expense 15,799 Adjustment to redemption value 97,084 Balance as of September 30, 2017 $ 567,001 __________________ (1) We did not have any redeemable noncontrolling interests prior to the Separation on July 17, 2017. (2) Excludes certain OP Units issued as part of the Combination which have an estimated fair value of $ 110.6 million , that are subject to post-combination employment with vesting over periods of either 12 or 60 months. See Note 11 for further information. |
Share-Based Payments and Employ
Share-Based Payments and Employee Benefits | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Payments and Employee Benefits | Share-Based Payments and Employee Benefits OP UNITS Certain OP Units issued as part of the Combination which have an estimated fair value of $ 110.6 million , are subject to post-combination employment with vesting over periods of either 12 or 60 months. The fair value of these 3.3 million OP Units was estimated based on the post-vesting restriction periods of the units. The significant assumptions used to value the units include expected volatilities ( 18.0% to 27.0% ), risk-free interest rates ( 1.3% to 1.5% ) and post-vesting restriction periods ( 1 year to 3 years ). Compensation expense for these units is recognized over the graded vesting period. See Note 3 for additional information. As of September 30, 2017 , none of these OP Units had vested or been forfeited. 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 then sole-shareholder approved the Plan. As of September 30, 2017 , there were 6.6 million common shares available for issuance under the Plan. Formation Awards Pursuant to the Plan, on July 18, 2017, we granted approximately 2.7 million 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 Formation Awards are structured in the form of profits interests in JBG SMITH LP 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 Formation Awards, subject to certain conditions, generally 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. The value of vested Formation Awards is realized through conversion into a number of LTIP Units, and subsequent conversion into a number of OP Units determined based on the difference between $37.10 and the value of a common share on the conversion date. The conversion ratio between Formation Awards and OP Units, which starts at zero, is the quotient of (i) the excess of the value of a common share on the conversion date above the per share value at the time the Formation Award was granted over (ii) the value of a common share as of the date of conversion. This is similar to a “cashless exercise” of stock options, whereby the holder receives a number of shares equal in value to the difference between the full value of the total number of shares for which the option is being exercised and the total exercise price. Like options, Formation Awards have a finite term over which their value is allowed to increase and during which they may be converted into LTIP Units (and in turn, OP Units). Holders of Formation Awards will not receive distributions or allocations of net income or net loss prior to vesting and conversion to LTIP Units. The fair value of the Formation Awards on the grant date was $23.7 million or $8.84 per unit estimated using Monte Carlo simulations. The significant assumptions used to value the awards include expected volatility ( 26.0% ), dividend yield ( 2.3% ), risk-free interest rate ( 2.3% ) and expected life ( 7 years ). Compensation expense for these awards is being recognized over a five -year period. As of September 30, 2017 , none of these Formation Awards had vested or been forfeited. LTIP Units On July 18, 2017, we granted a total of 47,166 fully vested LTIP Units to the seven non-employee trustees in the notional amount of $250,000 each. The LTIP Units may not be sold while such non-employee trustee is serving on the Board. On the same date, we also granted 59,927 LTIP units to a key employee 50% , which vested immediately and 50% of which vests in equal monthly installments from the 31 st to 60 th months following the grant date. These LTIP Units had an aggregate fair value of $3.5 million . On August 1, 2017, we granted approximately 302,500 LTIP Units to management and other employees under our Plan. The LTIP units vest in four equal installments on August 1 of each year, subject to continued employment. These LTIP Units were valued at a weighted average grant-fair value of $33.71 per unit. Compensation expense for these units is being recognized over a four -year period. As of September 30, 2017 , none of these LTIP Units had vested or been forfeited. The fair value of the LTIP Units was estimated based on the post-vesting restriction periods. The significant assumptions used to value the units include expected volatilities ( 17.0% to 19.0% ), risk-free interest rates ( 1.3% to 1.5% ) and post-vesting restriction periods ( 2 years to 3 years ). Net income and net loss is allocated to each LTIP Unit. LTIP Unit holders have the right to convert all or a portion of vested LTIP Units into OP Units, which are then subsequently exchangeable for our common shares. LTIP Units do not have redemption rights, but any OP Units into which LTIP Units are converted are entitled to redemption rights. LTIP Units, generally, vote with the OP Units and do not have any separate voting rights except in connection with actions that would materially and adversely affect the rights of the LTIP Units. OPP Units On August 1, 2017, we granted approximately 605,100 OPP Units to management and other employees under the Plan. OPP Units are performance-based equity compensation 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. Fifty percent 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. Net income and net loss are allocated to each OPP Unit. The fair value of the OPP Units on the date of grant was $9.7 million or $15.95 per unit estimated using Monte Carlo simulations. The significant assumptions used to value the OPP Units include expected volatility ( 18.0% ), dividend yield ( 2.3% ) and risk-free interest rates ( 1.5% ). Compensation expense for these units is being recognized over a four -year period. As of September 30, 2017 , none of these OPP Units had vested or been forfeited. Share-Based Compensation Expense Share-based compensation expense for the nine months ended September 30, 2017 is summarized as follows (in thousands): Formation Awards $ 3,963 LTIP Units that vested immediately 2,546 OP Units (1) 7,936 Share-based compensation related to Formation Transaction (2) 14,445 LTIP Units that vest over four years 885 OPP Units 469 Other equity awards 1,526 Share-based compensation expense - other (3) 2,880 Total share-based compensation expense 17,325 Less amount capitalized (161 ) Net share-based compensation expense (4) $ 17,164 ______________________________________________ (1) Represents share-based compensation expense for OP Units subject to post-combination employment. See Note 3 for further information. (2) Included in "General and administrative expense: share-based compensation related to Formation Transaction" in the accompanying statements of operations. (3) Included in "General and administrative expense" in the accompanying statements of operations. (4) Net share-based compensation expense for the three months ended September 30, 2017 was $16.0 million . As of September 30, 2017 , we had $141.4 million of total unrecognized compensation expense related to unvested share-based payment arrangements (unvested OP Units, Formation Awards, LTIP Units and OPP Units). This expense is expected to be recognized over a weighted average period of 3.4 years. Employee Benefits We have a 401(k) defined contribution plan (the “401(k) Plan”) covering substantially all of our officers and employees which permits participants to defer compensation up to the maximum amount permitted by law. We provide a discretionary matching contribution. Employees’ contributions vest immediately and our matching contributions vest over five years. Our contributions to the 401(k) Plan for three months ended September 30, 2017 and 2016 were $401,000 and $868,000 , respectively. Our contributions during the nine months ended September 30, 2017 and 2016 were $3.2 million and $3.1 million , respectively. |
(Loss) Earnings Per Share
(Loss) Earnings Per Share | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
(Loss) Earnings Per Share | (Loss) Earnings Per Share The following summarizes the calculation of basic and diluted EPS and provides a reconciliation of the amounts of net (loss) income available to common shareholders and shares of common stock used in calculating basic and diluted EPS for the three and nine months ended September 30, 2017 and 2016 : Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands, except per share amounts) Net (loss) income attributable to JBG SMITH Properties $ (69,831 ) $ 21,014 $ (57,851 ) $ 49,344 Weighted average shares outstanding — basic and diluted (1) 114,744 100,571 105,347 100,571 (Loss) earnings per share available to common shareholders: Basic $ (0.61 ) $ 0.21 $ (0.55 ) $ 0.49 Diluted $ (0.61 ) $ 0.21 $ (0.55 ) $ 0.49 _______________ (1) Reflects the weighted average common shares outstanding as of the date of the Separation in all periods prior to July 17, 2017. The effect of the conversion of 13,408 and 4,518 weighted average vested OP Units for the three and nine months ended September 30, 2017 is excluded in the computation of basic and diluted loss per share, as the assumed exchange of such units for common shares on a one-for-one basis was antidilutive (the assumed conversion of these units would have no net impact on the determination of diluted earnings per share). As vested and outstanding OP Units are held by a noncontrolling interest, losses are attributable to them based on the weighted average outstanding units and are thus excluded from the numerator in calculating basic and diluted loss per share. The number of securities that were excluded from the calculation of diluted (loss) earnings per share because they were antidilutive that potentially could be dilutive in the future are included in the following table: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 OP Units 3,281 — 3,281 — Formation Awards 2,681 — 2,681 — LTIP Units 410 — 410 — OPP Units 605 — 605 — |
Future Minimum Rental Income
Future Minimum Rental Income | 9 Months Ended |
Sep. 30, 2017 | |
Leases [Abstract] | |
Future Minimum Rental Income | Future Minimum Rental Income We lease space to tenants under operating leases that expire at various dates through the year 2036. The leases provide for the payment of fixed base rents payable monthly in advance as well as reimbursements of real estate taxes, insurance and maintenance costs. Retail leases may also provide for the payment by the lessee of additional rents based on a percentage of their sales. As of September 30, 2017 , future base rental revenue under these non-cancelable operating leases excluding extension options is as follows: Year ending December 31, Amount (In thousands) 2017 $ 133,025 2018 387,636 2019 310,230 2020 277,278 2021 234,005 2022 195,750 Thereafter 868,284 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis As of September 30, 2017 , we had various interest rate swap and cap agreements assumed in the Combination that are measured at fair value on a recurring basis. There were no interest rate swaps or caps prior to the Combination. The net unrealized gain on our interest rate swaps and caps was $467,000 for both the three and nine months ended September 30, 2017 and are included in "Interest expense" in the accompanying statements of operations. The fair values of the interest rate swaps and caps are based on the estimated amounts we would receive or pay to terminate the contract at the reporting date and are determined using interest rate pricing models and observable inputs. The interest rate swaps and caps are classified within Level 2 of the valuation hierarchy. The following are liabilities measured at fair value on a recurring basis as of September 30, 2017 : Fair Value Measurements Total Level 1 Level 2 Level 3 September 30, 2017 (In thousands) Interest rate swaps and caps: Classified as liabilities in "Other liabilities, net" $ 703 $ — $ 703 $ — Financial Assets and Liabilities Not Measured at Fair Value As of September 30, 2017 and December 31, 2016 , all financial instruments and liabilities were reflected in our balance sheets at amounts which, in our estimation, reasonably approximated their fair values, except for the following: September 30, 2017 December 31, 2016 Carrying Amount (1) Fair Value Carrying Amount (1) Fair Value (In thousands) Financial liabilities: Mortgages payable $ 1,988,247 $ 2,015,653 $ 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 and unsecured term loan was determined using Level 2 inputs of the fair value hierarchy. The fair value of our unsecured term loan is calculated based on the net present value of payments over the term of the loan using estimated market rates for similar notes and remaining terms. The fair value of the unsecured term loan was determined using Level 2 inputs of the fair value hierarchy. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information We review operating and financial data for each property on an individual basis; therefore, each of our individual properties is a separate operating segment. As a result of the Formation Transaction, we redefined our reportable segments to be aligned with our method of internal reporting and the way our Chief Executive Officer, who is also our Chief Operating Decision Maker (“CODM”), makes key operating decisions, evaluates financial results, allocates resources and manages our business. Accordingly, we aggregate our operating segments into three reportable segments (office, multifamily, and third-party real estate services) based on the economic characteristics and nature of our assets and services. In connection therewith, we have reclassified the prior period segment financial data to conform to the current period presentation. The CODM measures and evaluates the performance of our operating segments, with the exception of the third-party real estate services business, based on the net operating income (“NOI”) of properties within each segment. NOI includes property rental revenues and tenant reimbursements and deducts property operating expenses and real estate taxes. With respect to the third-party real estate services business, the CODM reviews revenues streams generated by this segment (third-party real estate services, including reimbursements), as well as the expenses attributable to the segment (general and administrative: third-party real estate services), which are disclosed separately in the statements of operations. Management company assets primarily consist of management and leasing contracts with a net book value of $56.0 million classified in "Other assets, net" in the balance sheet as of September 30, 2017 . Consistent with the CODM approach and our definition of NOI, the third-party real estate services operating results are excluded from the NOI data below. The following table reflects the reconciliation of net (loss) income attributable to JBG SMITH Properties to NOI for the three and nine months ended September 30, 2017 and 2016 : Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Net (loss) income attributable to JBG SMITH Properties $ (69,831 ) $ 21,014 $ (57,851 ) $ 49,344 Add: Depreciation and amortization expense 43,951 31,377 109,726 98,291 General and administrative expense: Corporate and other 10,593 10,913 35,536 36,040 Third-party real estate services 21,178 4,779 30,362 14,272 Share-based compensation related to Formation Transaction 14,445 — 14,445 — Transaction and other costs 104,095 1,528 115,173 1,528 Interest expense 15,309 13,028 43,813 38,662 Loss on extinguishment of debt 689 — 689 — Income tax (benefit) expense (1,034 ) 302 (317 ) 884 Less: Third-party real estate services, including reimbursements 25,141 8,297 38,881 24,617 Other income 1,158 1,564 3,701 3,938 (Loss) income from unconsolidated real estate ventures (1,679 ) 584 (1,365 ) (952 ) Interest and other (loss) income, net (379 ) 749 1,366 2,292 Gain on bargain purchase 27,771 — 27,771 — Net loss attributable to redeemable noncontrolling interests 8,160 — 2,481 — NOI $ 79,223 $ 71,747 $ 218,741 $ 209,126 Below is a summary of NOI by segment for the three and nine months ended September 30, 2017 and 2016 : Three Months Ended September 30, 2017 Office Multifamily Other Eliminations Total (In thousands) Rental revenue: Property rentals $ 91,534 $ 23,397 $ 4,171 $ (2,644 ) $ 116,458 Tenant reimbursements 7,917 1,548 128 — 9,593 Total rental revenue 99,451 24,945 4,299 (2,644 ) 126,051 Rental expense: — Property operating 27,000 6,796 3,502 (7,664 ) 29,634 Real estate taxes 13,038 2,952 1,204 — 17,194 Total rental expense 40,038 9,748 4,706 (7,664 ) 46,828 NOI $ 59,413 $ 15,197 $ (407 ) $ 5,020 $ 79,223 Three Months Ended September 30, 2016 Office Multifamily Other Eliminations Total (In thousands) Rental revenue: Property rentals $ 81,575 $ 15,850 $ 4,898 $ 942 $ 103,265 Tenant reimbursements 8,977 876 378 — 10,231 Total rental revenue 90,552 16,726 5,276 942 113,496 Rental expense: — Property operating 25,083 4,782 3,065 (5,643 ) 27,287 Real estate taxes 11,793 1,663 1,006 14,462 Total rental expense 36,876 6,445 4,071 (5,643 ) 41,749 NOI $ 53,676 $ 10,281 $ 1,205 $ 6,585 $ 71,747 Nine Months Ended September 30, 2017 Office Multifamily Other Eliminations Total (In thousands) Rental revenue: Property rentals $ 249,532 $ 62,050 $ 9,623 $ (4,306 ) $ 316,899 Tenant reimbursements 22,738 3,772 651 — 27,161 Total rental revenue 272,270 65,822 10,274 (4,306 ) 344,060 Rental expense: — Property operating 71,377 16,716 11,330 (22,082 ) 77,341 Real estate taxes 37,185 7,973 2,820 — 47,978 Total rental expense 108,562 24,689 14,150 (22,082 ) 125,319 NOI $ 163,708 $ 41,133 $ (3,876 ) $ 17,776 $ 218,741 Nine Months Ended September 30, 2016 Office Multifamily Other Eliminations Total (In thousands) Rental revenue: Property rentals $ 237,826 $ 45,203 $ 18,621 $ (2,153 ) $ 299,497 Tenant reimbursements 24,807 2,422 1,199 — 28,428 Total rental revenue 262,633 47,625 19,820 (2,153 ) 327,925 Rental expenses: — Property operating 69,740 12,594 14,934 (22,181 ) 75,087 Real estate taxes 34,855 5,063 3,794 — 43,712 Total rental expense 104,595 17,657 18,728 (22,181 ) 118,799 NOI $ 158,038 $ 29,968 $ 1,092 $ 20,028 $ 209,126 The following is a summary of certain balance sheet data by segment as of September 30, 2017 and December 31, 2016 : Office Multifamily Other Eliminations Total September 30, 2017 (In thousands) Real estate, at cost $ 3,867,513 $ 1,434,730 $ 540,287 $ — $ 5,842,530 Investments in and advances to unconsolidated real estate ventures $ 126,620 $ 106,842 $ 51,524 $ — $ 284,986 Total assets $ 3,338,100 $ 1,472,864 $ 1,204,063 $ — $ 6,015,027 December 31, 2016 Real estate, at cost $ 2,798,946 $ 959,404 $ 397,041 $ — $ 4,155,391 Investments in and advances to $ 45,647 $ — $ 129 $ — $ 45,776 Total assets $ 2,388,396 $ 873,157 $ 399,087 $ — $ 3,660,640 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Insurance We maintain general liability insurance with limits of $200.0 million per occurrence and in the aggregate, and property and rental value insurance coverage with limits of $2.0 billion per occurrence, with sub-limits for certain perils such as floods and earthquakes on each of our properties. We also maintain coverage for terrorist acts with limits of $2.0 billion per occurrence and in the aggregate, and $2.0 billion per occurrence and in the aggregate for nuclear, biological, chemical and radiological terrorism events, as defined by the Terrorism Risk Insurance Program Reauthorization Act, which expires in December 2020. Insurance premiums are charged directly to each of the properties and are included in "Property operating expenses" in the statement of operations. We will continue to monitor the state of the insurance market and the scope and costs of coverage for acts of terrorism. We cannot anticipate what coverage will be available on commercially reasonable terms in the future. We are responsible for deductibles and losses in excess of the insurance coverage, which could be material. Our debt, consisting of mortgage loans secured by our properties, revolving credit facility and unsecured term loans contain customary covenants requiring adequate insurance coverage. Although we believe that we currently have adequate insurance coverage, we may not be able to obtain an equivalent amount of coverage at reasonable costs in the future. If lenders insist on greater coverage than we are able to obtain, it could adversely affect the ability to finance or refinance our properties. Construction Commitments As of September 30, 2017 , we have construction in progress that will require an additional $707.8 million to complete ( $611.1 million related to our consolidated entities and $96.7 million related to our unconsolidated real estate ventures at our share), based on our current plans and estimates, which we anticipate will be primarily expended over the next two to three years. These capital expenditures are generally due as the work is performed, and we expect to finance them with debt proceeds, proceeds from asset recapitalizations and sales, and available cash. 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. From time to time, we (or ventures in which we have an ownership interest) have agreed, and may in the future agree, to (1) guarantee portions of the principal, interest and other amounts in connection with their borrowings, (2) provide customary environmental indemnifications and nonrecourse carve-outs (e.g., guarantees against fraud, misrepresentation and bankruptcy) in connection with their borrowings and (3) provide guarantees to lenders and other third parties for the completion of development projects. We customarily have agreements with our outside partners whereby the partners agree to reimburse the joint venture or us for their share of any payments made under the guarantee. Amounts that may be required to be paid in future periods in relation to budget overruns or operating losses that also included in some of our guarantees are not estimable. Guarantees (excluding environmental) terminate either upon the satisfaction of specified circumstances or repayment of the underlying debt. As of September 30, 2017 , the aggregate amount of our principal payment guarantees was approximately $89.0 million for our consolidated entities and $63.8 million for our unconsolidated real estate ventures. As of September 30, 2017 , we expect to fund additional capital to certain of our unconsolidated investments totaling approximately $50.6 million , , which we anticipate will be primarily expended over the next two to three years. We are obligated under non-cancelable operating leases, primarily for ground leases on certain of our properties through 2112. As of September 30, 2017 , future minimum rental payments under non-cancelable operating and capital leases are as follows: Year ending December 31, Amount (In thousands) 2017 $ 1,974 2018 8,391 2019 8,170 2020 7,825 2021 7,496 2022 6,580 Thereafter 874,467 Total $ 914,903 |
Transactions With Vornado and J
Transactions With Vornado and JBG Legacy Funds | 9 Months Ended |
Sep. 30, 2017 | |
Related Party Transactions [Abstract] | |
Transactions With Vornado and JBG Legacy Funds | Transactions With Vornado and JBG Legacy Funds Transactions with Vornado As described in Note 1 and Note 3, the accompanying financial statements present the operations of the office and multifamily assets as carved-out from the financial statements of Vornado for all periods prior to July 17, 2017. 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 consolidated and combined financial statements based on either actual costs incurred or a proportion of costs estimated to be applicable to the Vornado Included Assets based on key metrics including total revenue. The total amounts allocated during the three months ended September 30, 2017 and 2016 were $873,000 and $4.5 million , respectively. The total amounts allocated during the nine months ended September 30, 2017 and 2016 were $13.0 million and $15.2 million , respectively. These allocated amounts are included as a component of "General and administrative expense: corporate and other" expenses on the statements of operations 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 nine months ended September 30, 2017 and 2016 are not necessarily indicative of allocated amounts for a full year. In connection with the Formation Transaction, we entered into an agreement with Vornado under which Vornado provides 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 are based on an hourly or per transaction fee arrangement including reimbursement for overhead and out-of-pocket expenses. The total charges for both the three months and nine months ended September 30, 2017 were approximately $912,000 . Pursuant to an agreement, we are providing Vornado with leasing and property management services for certain of its assets that were not part of the Separation. The total revenue related to these services for both the three months and nine months ended September 30, 2017 was $68,000 . We believe that the terms of both of these agreements are comparable to those that would have been negotiated based on market rates. 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% due August 2019. During 2016 and 2015, Vornado repaid $4.0 million and $7.0 million of the loan receivable, respectively. At the Separation, Vornado repaid the outstanding balance of the loan and related accrued interest. As of December 31, 2016 , the balance of the receivable from Vornado, including accrued interest, was $75.1 million . We recognized interest income of $130,000 and $1.8 million during the three and nine months ended September 30, 2017 , respectively, and $830,000 and $2.3 million during the three and nine months ended September 30, 2016 , respectively. In connection with the development of The Bartlett, prior to the Combination, we entered into various note agreements with Vornado whereby we could borrow up to a maximum of $170.0 million . Vornado contributed these note agreements along with accrued and unpaid interest to JBG SMITH at the Separation. As of December 31, 2016 , the amounts outstanding under these note agreements at were $166.5 million , and are included in "Payable to former parent" on our balance sheets. We incurred interest of $365,000 and $4.1 million during the three and nine months ended September 30, 2017 , respectively, and $1.2 million and $3.0 million during the three and nine months ended September 30, 2016 , respectively. 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. The loan was repaid with amounts drawn under our revolving credit facility. See Note 8 for further information. Given that the $115.6 million draw on Vornado’s credit facility is secured by an interest in the property, such amount was included in "Payable to former parent" in our balance sheets as of December 31, 2016 . We incurred interest expense of $120,000 and $1.3 million during the three and nine months ended September 30, 2017 , respectively, and $457,000 and $602,000 for the three and nine months ended September 30, 2016 , respectively. We have agreements, that are terminable on the second anniversary of the Combination, with Building Maintenance Services ("BMS"), a wholly owned subsidiary of Vornado, to supervise cleaning, engineering and security services at our properties. We paid BMS $3.6 million and $9.9 million during the three and nine months ended September 30, 2017 , respectively, and $3.3 million and $9.6 million during the three and nine months ended September 30, 2016 , respectively, which are included in "Property operating expenses" in our statements of operations. 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 expires on December 31, 2017 and provides for the payment of consulting fees at the rate of $166,667 per month for the 24 months following the Separation, including after the termination of the consulting agreement. The amount due under this consulting agreement of $4.1 million was recorded as a liability in connection with the Combination. As of September 30, 2017 , the remaining liability is $3.6 million . 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. Fees from JBG Legacy Funds In addition to our portfolio, we have a third-party real estate services business that provides fee-based real estate services to our real estate ventures, legacy funds formerly organized by JBG and other third parties. We provide services for the benefit of the JBG Legacy Funds that own interests in the assets retained by the JBG Legacy Funds. In connection with the contribution of the JBG Assets to us, it was determined that the general partner and managing member interests in the JBG Legacy Funds that were held by former JBG executives (and who became members of our management team and/or Board of Trustees) would not be transferred to us and remain under the control of these individuals. In addition, members of our senior management and Board of Trustees have an ownership interest in the JBG Legacy Funds and own carried interests in each fund and in certain of our joint ventures that entitles them to receive additional compensation if the fund or joint venture achieves certain return thresholds. This third-party real estate services revenue, including reimbursements, from these JBG Legacy Funds for both the three and nine months ended September 30, 2017 was $8.4 million . Registration Rights Agreements In connection with the Formation Transaction, we entered into a registration rights agreement with certain former investors in the legacy JBG funds that received our common shares in the Formation Transaction (the "Shares Registration Rights Agreement") and a separate registration rights agreement with the certain former investors in the legacy JBG funds and certain employees of JBG entities that received OP Units in the Formation Transaction (the "OP Units Registration Rights Agreement" and together with the Shares Registration Rights Agreement, the "Registration Rights Agreements"). Certain holders of common shares and OP Units who may benefit from the Registration Rights Agreements are members of our management team and/or Board of Trustees. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events In October 2017, we closed a $78.0 million loan on 1235 South Clark, an office asset in Crystal City, Virginia. The loan has a 10 -year term and a fixed interest rate of 3.94% . In October 2017, we repaid a $67.3 million loan at 220 20th Street, a multifamily asset located in Crystal City, Virginia. In October 2017, we entered into agreements in the specified notional amounts to swap variable interest rates to fixed rates on the following debt instruments: • $50.0 million related to our Tranche A-1 Term Loan; • $107.7 million related to our mortgage loan on RTC - West; and • $107.5 million related to our mortgage loan on 800 North Glebe Road. In November 2017, we closed a $110.0 million refinancing on Atlantic Plumbing, a multifamily and retail asset in the U Street/Shaw submarket of Washington, DC. The loan has a five -year term and a floating rate of LIBOR plus 1.50% . A prior swap agreement has been novated to synthetically fix the interest rate through September 2020. At closing, $100.0 million was funded, which was used in part to repay the existing $88.4 million loan. We have the ability to draw an additional $10.0 million based on the asset’s performance. On November 9, 2017, our Board of Trustees declared a quarterly dividend of $0.225 per common share, payable on November 30, 2017 to shareholders of record on November 20, 2017. |
Summary of Significant Accoun26
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of the 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. |
Business Combinations | Business Combinations We account for business combinations, including the acquisition of real estate, using the acquisition method by recognizing and measuring the identifiable assets acquired, liabilities assumed, and any noncontrolling interests in the acquiree at their acquisition date fair values. As a result, upon the acquisition, we estimate the fair value of the acquired tangible assets (consisting of real estate, cash and cash equivalents, tenant and other receivables, investments in unconsolidated real estate ventures and other assets, as applicable), identified intangible assets and liabilities (consisting of the value of in-place leases, above- and below-market leases, options to enter into ground lease and management contracts, as applicable), assumed debt and other liabilities, and noncontrolling interests, as applicable, based on our evaluation of information and estimates available at that date. Based on these estimates, we allocate the purchase price to the identified assets acquired and liabilities assumed. Any excess of the purchase price over the estimated fair value of the net assets acquired is recorded as goodwill. Any excess of the fair value of assets acquired over the purchase price is recorded as a gain on bargain purchase. If, up to one year from the acquisition date, information regarding the fair value of the net assets acquired and liabilities assumed is received and estimates are refined, appropriate adjustments are made on a prospective basis to the purchase price allocation, which may include adjustments to identified assets, assumed liabilities, and goodwill or the gain on bargain purchase, as applicable. Transaction costs related to business combinations are expensed as incurred and included in "Transaction and other costs" in our statements of operations. The fair values of tangible real estate assets are determined using the “as-if vacant” approach whereby we use discounted income, or cash flow models with inputs and assumptions that we believe are consistent with current market conditions for similar assets. The most significant assumptions in determining the allocation of the purchase price to tangible assets are the exit capitalization rate, discount rate, estimated market rents and hypothetical expected lease-up periods. The fair values of identified intangible assets are determined based on the following: • The value allocable to the above- or below-market component of an acquired in-place lease is determined based upon the present value (using a discount rate which reflects the risks associated with the acquired leases) of the difference between (i) the contractual amounts to be received pursuant to the lease over its remaining term and (ii) management’s estimate of the amounts that would be received using market rates over the remaining term of the lease. Amounts allocated to above- market leases are recorded as "Identified intangible assets" in "Other assets, net" in the balance sheets, and amounts allocated to below-market leases are recorded as "Lease intangible liabilities" in "Other liabilities, net" in the balance sheets. These intangibles are amortized to "Property rentals" in our statements of operations over the remaining terms of the respective leases. • Factors considered in determining the value allocable to in-place leases include estimates, during hypothetical lease-up periods, related to space that is actually leased at the time of acquisition. These estimates include (i) lost rent at market rates, (ii) fixed operating costs that will be recovered from tenants and (iii) theoretical leasing commissions required to execute similar leases. These intangible assets are recorded as "Identified intangible assets" in "Other assets, net" in the balance sheets and are amortized over the remaining term of the existing lease. • The fair value of the in-place property management, leasing, asset management, and development and construction management contracts is based on revenue and expense projections over the estimated life of each contract discounted using a market discount rate. These management contract intangibles are amortized over the weighted average life of the management contracts. The fair value of investments in unconsolidated real estate ventures and related noncontrolling interests is based on the estimated fair values of the identified assets acquired and liabilities assumed of each entity. The fair value of the mortgages payable assumed was determined using current market interest rates for comparable debt financings. The fair values of the interest rate swaps and caps are based on the estimated amounts we would receive or pay to terminate the contract at the reporting date and are determined using interest rate pricing models and observable inputs. The carrying value of cash, restricted cash, working capital balances, leasehold improvements and equipment, and other assets acquired and liabilities assumed approximates fair value. The results of operations of acquisitions are included in our financial statements as of the dates they are acquired. The intangible assets and liabilities associated with acquisitions are included in "Other assets, net" and "Other liabilities, net", respectively, in our balance sheets. |
Real Estate | Real Estate Real estate is carried at cost, net of accumulated depreciation and amortization. Maintenance and repairs are expensed as incurred. As real estate is undergoing redevelopment activities, all property operating expenses directly associated with and attributable to the redevelopment, including interest expense, are capitalized to the extent that we believe such costs are recoverable through the value of the property. The capitalization period begins when redevelopment activities are underway and ends when the project is substantially complete. General and administrative costs are expensed as incurred. Depreciation requires an estimate by management of the useful life of each property and improvement as well as an allocation of the costs associated with a property to its various components. Depreciation is recognized on a straight‑line basis over estimated useful lives, which range from three to 40 years . Tenant allowances are amortized on a straight‑line basis over the lives of the related leases, which approximate the useful lives of the tenant improvements. Construction in progress, including land, is carried at cost, and no depreciation is recorded. Real estate undergoing significant renovations and improvements is considered under development. All direct and indirect costs related to development activities are capitalized into "Construction in progress, including land" on our balance sheets, except for certain demolition costs, which are expensed as incurred. Costs incurred include pre-development expenditures directly related to a specific project, development and construction costs, interest, insurance and real estate taxes. Indirect development costs include employee salaries and benefits, travel and other related costs that are directly associated with the development real estate. Our method of calculating capitalized interest expense is based upon applying our weighted average borrowing rate to the actual accumulated expenditures if the property does not have property specific debt. The capitalization of such expenses ceases when the real estate is ready for its intended use, but no later than one-year from substantial completion of major construction activity. If we determine that a project is no longer viable, all pre-development project costs are immediately expensed. Similar costs related to properties not under development are expensed as incurred. Our assets and related intangible assets are individually reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. An impairment exists when the carrying amount of an asset exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. Estimates of future cash flows are based on our current plans, intended holding periods and available market information at the time the analyses are prepared. An impairment loss is recognized only if the carrying amount of the asset is not recoverable and is measured based on the excess of the property’s carrying amount over its estimated fair value. If our estimates of future cash flows, anticipated holding periods, or fair values change, based on market conditions or otherwise, our evaluation of impairment charges may be different and such differences could be material to our financial statements. Estimates of future cash flows are subjective and are based, in part, on assumptions regarding future occupancy, rental rates and capital requirements that could differ materially from actual results. |
Real Estate Held for Sale | Real Estate Held for Sale Real estate held for sale is recorded at the lower of the carrying amount or the expected sales price less costs to sell. Operations of real estate held for sale and real estate sold are reported in continuing operations if their disposition does not represent a strategic shift that has or will have a major effect on our operations and financial results. The application of the accounting principles that govern the classification any of our real estate as held for sale requires management to make certain significant judgments. In evaluating whether real estate meets the held for sale criteria set forth by the Property, Plant and Equipment Topic of the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC"), we make a determination as to the point in time that it is probable that a sale will be consummated. Given the nature of all real estate sales contracts, it is not unusual for such contracts to allow potential buyers a period of time to evaluate the property prior to formal acceptance of the contract. In addition, certain other matters critical to the final sale, such as financing arrangements, often remain pending even upon contract acceptance. As a result, real estate under contract may not close within the expected time period or may not close at all. Therefore, any real estate categorized as held for sale represents only those properties that management has determined are probable to close within the requirements set forth in the Property, Plant and Equipment Topic of the FASB ASC. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of highly liquid investments with original maturities of three months or less and are carried at cost, which approximates fair value, due to their short‑term maturities. |
Restricted Cash | Restricted Cash Restricted cash consists primarily of security deposits held on behalf of our tenants, cash escrowed under loan agreements for debt service, real estate taxes, property insurance and capital improvements. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts We periodically evaluate the collectability of amounts due from tenants, including the receivable arising from deferred rent receivable, and maintain an allowance for doubtful accounts for the estimated losses resulting from the inability of tenants to make required payments under lease agreements. We exercise judgment in establishing these allowances and consider payment history and current credit status in developing these estimates. |
Investments in and Advances to Real Estate Ventures | Investments in and Advances to Real Estate Ventures We analyze our real estate ventures to determine whether the respective entities should be consolidated. If it is determined that these investments do not require consolidation because the entities are not VIEs in accordance with the Consolidation Topic of the FASB ASC, we are not considered the primary beneficiary of the entities determined to be VIEs, we do not have voting control, and/or the limited partners (or non-managing members) have substantive participatory rights, then the selection of the accounting method used to account for our investments in unconsolidated real estate ventures is generally determined by our voting interests and the degree of influence we have over the entity. Management uses its judgment when determining if we are the primary beneficiary of, or have a controlling financial interest in, an entity in which we have a variable interest. Factors considered in determining whether we have the power to direct the activities that most significantly impact the entity’s economic performance include risk and reward sharing, experience and financial condition of the other partners, voting rights, involvement in day-to-day capital and operating decisions and the extent of our involvement in the entity. We use the equity method of accounting for investments in unconsolidated real estate ventures when we own 20% or more of the voting interests and have significant influence but do not have a controlling financial interest, or if we own less than 20% of the voting interests but have determined that we have significant influence. Under the equity method, we record our investments in and advances to these entities in our balance sheets, and our proportionate share of earnings or losses earned by the real estate venture is recognized in "(Loss) income of unconsolidated real estate ventures" in the accompanying statements of operations. We earn revenues from the management services we provide to unconsolidated entities. These fees are determined in accordance with the terms specific to each arrangement and may include property and asset management fees or transactional fees for leasing, acquisition, development and construction, financing, and legal services provided. We account for this revenue gross of our ownership interest in each respective real estate venture and recognize such revenue in "Third-party real estate services, including reimbursements" in our statements of operations. Our proportionate share of related expenses is recognized in "(Loss) income of unconsolidated real estate ventures" in our statements of operations. We may also earn incremental promote distributions if certain financial return benchmarks are achieved upon ultimate disposition of the underlying properties. Management fees are recognized when earned, and promote fees are recognized when certain earnings events have occurred, and the amount is determinable and collectible. Any promote fees are reflected in "(Loss) income from unconsolidated real estate ventures" in our statements of operations. On a periodic basis, we evaluate our investments in unconsolidated entities for impairment. We assess whether there are any indicators, including underlying property operating performance and general market conditions, that the value of our investments in unconsolidated real estate ventures may be impaired. An investment in a real estate venture is considered impaired only if we determine that its fair value is less than the net carrying value of the investment in that real estate venture on an other-than-temporary basis. Cash flow projections for the investments consider property level factors such as expected future operating income, trends and prospects, as well as the effects of demand, competition and other factors. We consider various qualitative factors to determine if a decrease in the value of our investment is other-than-temporary. These factors include age of the venture, our intent and ability to retain our investment in the entity, financial condition and long-term prospects of the entity and relationships with our partners and banks. If we believe that the decline in the fair value of the investment is temporary, no impairment charge is recorded. If our analysis indicates that there is an other-than temporary impairment related to the investment in a particular real estate venture, the carrying value of the venture will be adjusted to an amount that reflects the estimated fair value of the investment. |
Intangibles | Intangibles Intangible assets consist of in-place leases, below-market ground rent obligations, above-market real estate leases, lease origination costs and options to enter into ground lease that were recorded in connection with the acquisition of properties. Intangible assets also include management and leasing contracts acquired as part of the Combination. Intangible liabilities consist of above-market ground rent obligations and below-market real estate leases that are also recorded in connection with the acquisition of properties. Both intangible assets and liabilities are amortized and accreted using the straight-line method over their applicable remaining useful life. When a lease or contract is terminated early, any remaining unamortized or unaccreted balances are charged to earnings. The useful lives of intangible assets are evaluated each reporting period with any changes in estimated useful lives being accounted for over the revised remaining useful life. |
Deferred Costs | Deferred Costs Deferred financing costs consist of loan issuance costs directly related to financing transactions that are deferred and amortized over the term of the related loan as a component of interest expense. Unamortized deferred financing costs related to our mortgages payable and unsecured term loan are presented as a direct deduction from the carrying amounts of the related debt instruments, while such costs related to our revolving credit facility are included in other assets. Direct salaries, third-party fees and other costs incurred by us to originate a lease are capitalized in "Other assets, net" in the balance sheets and are amortized against the respective leases using the straight-line method over the term of the related leases. |
Noncontrolling Interests | Noncontrolling Interests Redeemable noncontrolling interests consists of OP Units issued in conjunction with the Formation Transaction. The OP Units are redeemable for our common shares or cash beginning August 1, 2018, subject to certain limitations. Redeemable noncontrolling interests are generally redeemable at the option of the holder and are presented in the mezzanine section between total liabilities and shareholders' equity on the balance sheets. The carrying amount of redeemable noncontrolling interests is adjusted to its redemption value at the end of each reporting period, but no less than its initial carrying value, with such adjustments recognized in "Additional paid-in capital". Noncontrolling interests in consolidated subsidiaries represents the portion of equity that we do not own in entities we consolidate, including interests in consolidated real estate ventures or VIEs in connection with property acquisitions. We identify our noncontrolling interests separately within the equity section on the balance sheets. See Note 10 for further information. Amounts of consolidated net (loss) income attributable to redeemable noncontrolling interests and to the noncontrolling interests in consolidated subsidiaries are presented separately in the statements of operations. |
Derivatives Financial Instruments and Hedge Accounting | Derivative Financial Instruments and Hedge Accounting Derivative financial instruments are used at times to manage exposure to variable interest rate risk. Derivative financial instruments, consisting of interest rate swaps and caps, are considered economic hedges, but not designated as accounting hedges, and are carried at their estimated fair value on a recurring basis. Realized and unrealized gains are recorded in "Interest and other (loss) income, net" in the statements of operations in the period in which the change occurs. |
Fair Value of Assets and Liabilities | Fair Value of Assets and Liabilities 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. |
Revenue Recognition | Revenue Recognition Property rentals income includes base rents that each tenant pays in accordance with the terms of its respective lease and is reported on a straight-line basis over the non-cancellable term of the lease, which includes the effects of periodic step-ups in rent and rent abatements under the leases. We commence rental revenue recognition when the tenant takes possession of the leased space or controls the physical use of the leased space and the leased space is substantially ready for its intended use. In circumstances where we provide a tenant improvement allowance for improvements that are owned by the tenant, we recognize the allowance as a reduction of property rentals revenue on a straight-line basis over the term of the lease. Differences between rental income recognized and amounts due under the respective lease agreements are recorded as an increase or decrease to “Deferred rent receivable, net” on our balance sheets. Property rentals also includes the amortization of acquired above-and below-market leases, net. Tenant reimbursements provide for the recovery of all or a portion of the operating expenses and real estate taxes of the respective assets. Tenant reimbursements are accrued in the same periods as the related expenses are incurred. Third-party real estate services revenue, including reimbursements, is determined in accordance with the terms specific to each arrangement and may include property and asset management fees or transactional fees for leasing, acquisition, development and construction, financing, and legal services provided. These fees are determined in accordance with the terms specific to each arrangement and are recognized as the related services are performed. Development and construction fees earned from providing services to our unconsolidated real estate joint ventures are recorded on a percentage of completion basis. |
Third-Party Real Estate Services Expenses | Third-Party Real Estate Services Expenses Third-party real estate services expenses include the costs associated with the management services provided to our unconsolidated real estate joint ventures and other third parties. We allocate personnel and other overhead costs using the estimates of the time spent performing services for our third-party business and other allocation methodologies. |
Income Taxes | Income Taxes We intend to elect to be taxed as a REIT under sections 856-860 of the Internal Revenue Code of 1986, as amended (the "Code"), commencing with the filing of our tax return for the 2017 calendar year, effective for our tax year ending December 31, 2017. 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. Prior to the Separation, the Vornado Included Assets historically operated under Vornado’s REIT structure. 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 financial statements for the periods prior to the Separation. We intend to continue to adhere to these requirements and maintain our REIT status in future periods. As a REIT, we are allowed to reduce taxable income by all or a portion of our distributions to shareholders. Future distributions will be declared and paid at the discretion of the Board of Trustees and will depend upon cash generated by operating activities, our financial condition, capital requirements, annual dividend requirements under the REIT provisions of the Code, as amended, and such other factors as our Board of Trustees deems relevant. |
(Loss) Earnings Per Share | (Loss) Earnings Per Share Basic (loss) earnings per common share ("EPS") is computed by dividing net (loss) income attributable to common shareholders by the weighted average common shares outstanding during the period. Unvested and vested share-based payment awards that entitle holders to receive non-forfeitable dividends, which include OP Units, long-term incentive partnership units ("LTIP Units") and out-performance award units ("OPP Units"), are considered participating securities. Consequently, we are required to apply the two-class method of computing basic and diluted earnings that would otherwise have been available to common shareholders. Under the two-class method, earnings for the period are allocated between common shareholders and participating securities based on their respective rights to receive dividends. During periods of net loss, losses are allocated only to the extent the participating securities are required to absorb their share of such losses. Diluted earnings per common share reflects the potential dilution of the assumed exchange of various units into common shares unvested share-based payment awards to the extent they are dilutive. |
Share-based Compensation | Share-Based Compensation We granted OP Units, formation awards ("Formation Awards"), LTIP Units and OPP Units to our trustees, management and employees in connection with the Separation and Combination. The term and vesting of each award were determined by the compensation committee of our Board of Trustees (the “Compensation Committee”). Fair value is determined, depending on the type of award, using the Monte Carlo method or post-vesting restriction periods, which is intended to estimate the fair value of the awards at the grant date using dividend yields and expected volatilities that are primarily based on available implied data and peer group companies' historical data. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The shortcut method is used for determining the expected life used in the valuation method. Compensation expense for the Formation Awards, LTIP Units, OPP Units and certain OP Units is based on the fair value of our common shares at the date of the grant and is recognized ratably over the vesting period. For grants with a graded vesting schedule that are only subject to service conditions, we have elected to recognize compensation expense on a straight-line basis. We also elected to account for forfeitures as they occur, rather than estimate expected forfeitures. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The following table provides a brief description of recent accounting pronouncements (Accounting Standards Update or "ASU") by the 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 Standard adopted 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. September 2017 The adoption and implementation of this standard did not have an impact on our results of operations, financial condition or cash flows. Standard Description Date of Adoption Effect on the Financial Statements or Other Significant Matters Standards not yet adopted ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities The standard provides new guidance for the determination of eligibility for hedge accounting and effectiveness. It also amends the presentation and disclosure requirements. ASU 2017-12 requires a modified retrospective transition method which requires the recognition of the cumulative effect of the change on the opening balance of each affected component of equity in the statement of financial position as of the date of adoption. January 2019 We are currently evaluating the overall impact of the adoption of ASU 2017-12. The adoption of this standard is not expected to have a material impact on our financial statements. 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 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 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 a material impact on our financial statements. 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 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 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 revenue. 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 financial statements. |
Organization and Basis of Pre27
Organization and Basis of Presentation and Combination (Tables) | 9 Months Ended |
Sep. 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 our rental revenue for the three and nine months ended September 30, 2017 and 2016 , as follows: Three Months Ended September 30, Nine Months Ended September 30, (Dollars in thousands) 2017 2016 2017 2016 U.S. federal government $ 22,492 $ 27,594 $ 68,869 $ 74,939 Percentage of office segment revenue 22.6 % 30.5 % 25.3 % 28.5 % Percentage of total rental revenue 17.8 % 24.3 % 20.0 % 22.9 % |
The Combination (Tables)
The Combination (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following allocation of the purchase price is based on preliminary estimates and assumptions and is subject to change based on a final determination of the assets acquired and liabilities assumed (in thousands): Fair value of purchase consideration: Common shares and OP Units $ 1,224,886 Cash 20,573 Total consideration paid $ 1,245,459 Fair value of assets acquired and liabilities assumed: Land and improvements $ 342,932 Building and improvements 623,889 Construction in progress, including land 632,664 Leasehold improvements and equipment 7,890 Cash 104,516 Restricted cash 13,460 Investments in and advances to unconsolidated real estate ventures 238,388 Identified intangible assets 146,600 Notes receivable (1) 50,934 Identified intangible liabilities (8,449 ) Mortgages payable assumed (2) (768,523 ) Capital lease obligations assumed (3) (33,543 ) Deferred tax liability (4) (21,476 ) Other liabilities acquired, net (52,065 ) Noncontrolling interests in consolidated subsidiaries (3,987 ) Net assets acquired 1,273,230 Gain on bargain purchase (5) 27,771 Total consideration paid $ 1,245,459 ____________________ (1) During the three months ended September 30, 2017 , we received proceeds of $50.9 million from the repayment of the notes receivable acquired as part of the Combination. (2) Subject to various interest rate swap and cap agreements assumed in the Combination that are considered economic hedges, but not designated as accounting hedges. (3) As part of the Combination, two ground leases were assumed that were capital leases. On July 25, 2017, we purchased a land parcel located in Reston, Virginia associated with one of the ground leases for $19.5 million . (4) Related to the management and leasing contracts acquired in the Combination. (5) The Combination resulted in a gain on bargain purchase because the estimated fair value of the identifiable net assets acquired exceeded the purchase consideration by $27.8 million . The purchase consideration was based on the fair value of the common shares and OP Units issued in the Combination. We continue to reassess the recognition and measurement of identifiable assets and liabilities acquired and have preliminarily concluded that all acquired assets and liabilities were recognized and that the valuation procedures and resulting estimates of fair values were appropriate. |
Schedule of Business Acquisitions by Acquisition, Equity Interest Issued or Issuable | The fair value of the common shares and OP Units purchase consideration was determined as follows (i n thousands, except exchange ratio and price per share/unit): Outstanding common shares and common limited partnership units prior to the Combination 100,571 Exchange ratio (1) 2.71 Common shares and OP Units issued in consideration 37,164 Price per share/unit (2) $ 37.10 Fair value of common shares and OP Units issued in consideration $ 1,378,780 Fair value adjustment to OP Units due to transfer restrictions (43,303 ) Portion of consideration attributable to performance of future services (3) (110,591 ) Fair value of common shares and OP Units purchase consideration $ 1,224,886 ____________________ (1) Represents the implied exchange ratio of one common share and OP Unit of JBG SMITH for 2.71 common shares and common limited partnership units prior to the Combination. (2) Represents the volume weighted average share price on July 18, 2017. (3) OP Unit consideration paid to certain of the owners of the JBG Assets which have an estimated fair value of $ 110.6 million is subject to post-combination employment with vesting over periods of either 12 or 60 months. In accordance with GAAP, consideration that is subject to future employment is not considered a component of the purchase price for the business combination and amortization is recognized as compensation expense over the period of employment and is included in "General and administrative expense: share-based compensation related to Formation Transaction" in the statements of operations. |
Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination | The fair values of the depreciable tangible and identified intangible assets and liabilities, all of which have definite lives and are amortized, are as follows: Total Fair Value Weighted Average Amortization Period Useful Life (1) (In thousands) (In years) Tangible assets: Building and improvements $ 559,042 3 - 40 years Tenant improvements 64,847 Shorter of useful life or remaining life of the respective lease Total building and improvements $ 623,889 Leasehold improvements $ 4,422 Shorter of useful life or remaining life of the respective lease Identified intangible assets: In-place leases $ 59,351 6.4 Remaining life of the respective lease Above-market real estate leases 11,700 6.3 Remaining life of the respective lease Below-market ground leases 659 88.5 Remaining life of the respective lease Option to enter into ground lease 17,090 N/A Remaining life of contract Management and leasing contracts (2) 57,800 7.4 Estimated remaining life of contracts, ranging between 3 - 8 years Total identified intangible assets $ 146,600 Identified intangible liabilities: Below-market real estate leases $ 8,449 10.2 Remaining life of the respective lease ____________________ (1) In determining these useful lives, we considered the length of time the asset had been in existence, the maintenance history, as well as anticipated future maintenance, and any contractual stipulations that might limit the useful life. (2) Includes in-place property management, leasing, asset management, and development and construction management contracts. |
Schedule of Indefinite-lived Intangible Assets Acquired as Part of Business Combination | The fair values of the depreciable tangible and identified intangible assets and liabilities, all of which have definite lives and are amortized, are as follows: Total Fair Value Weighted Average Amortization Period Useful Life (1) (In thousands) (In years) Tangible assets: Building and improvements $ 559,042 3 - 40 years Tenant improvements 64,847 Shorter of useful life or remaining life of the respective lease Total building and improvements $ 623,889 Leasehold improvements $ 4,422 Shorter of useful life or remaining life of the respective lease Identified intangible assets: In-place leases $ 59,351 6.4 Remaining life of the respective lease Above-market real estate leases 11,700 6.3 Remaining life of the respective lease Below-market ground leases 659 88.5 Remaining life of the respective lease Option to enter into ground lease 17,090 N/A Remaining life of contract Management and leasing contracts (2) 57,800 7.4 Estimated remaining life of contracts, ranging between 3 - 8 years Total identified intangible assets $ 146,600 Identified intangible liabilities: Below-market real estate leases $ 8,449 10.2 Remaining life of the respective lease ____________________ (1) In determining these useful lives, we considered the length of time the asset had been in existence, the maintenance history, as well as anticipated future maintenance, and any contractual stipulations that might limit the useful life. (2) Includes in-place property management, leasing, asset management, and development and construction management contracts. |
Business Acquisition, Pro Forma Information | The unaudited pro forma information for the three and nine months ended September 30, 2017 and 2016 was adjusted to exclude $27.8 million of gain on bargain purchase. The unaudited pro forma information was adjusted to exclude transaction and other costs of $104.1 million and $115.2 million for the three and nine months ended September 30, 2017 , respectively, and $1.5 million for the three and nine months ended September 30, 2016 . Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) (In thousands) Unaudited pro forma information: Total revenue $ 160,428 $ 170,498 $ 481,314 $ 492,874 Net income (loss) attributable to JBG SMITH Properties $ 2,283 $ 803 $ (13,741 ) $ (26,701 ) Earnings (loss) per common share: Basic $ 0.02 $ 0.01 $ (0.13 ) $ (0.27 ) Diluted $ 0.02 $ 0.01 $ (0.13 ) $ (0.27 ) |
Tenants and Other Receivables29
Tenants and Other Receivables, Net (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Receivables [Abstract] | |
Schedule of Tenants and Other Receivables, Net | The following is a summary of tenant and other receivables, net as of September 30, 2017 and December 31, 2016 : September 30, December 31, (In thousands) Tenants $ 32,106 $ 26,278 Other 23,835 11,314 Allowance for doubtful accounts (5,467 ) (4,212 ) Total tenant and other receivables, net $ 50,474 $ 33,380 |
Investments in Unconsolidated30
Investments in Unconsolidated Real Estate Ventures (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Composition of Investments | The following is a summary of the composition of our investments in and advances to unconsolidated real estate ventures as of September 30, 2017 and December 31, 2016 : Ownership Interest (1) Investment Balance Real Estate Venture Partners (1) September 30, September 30, December 31, (In thousands) Landmark 1.8% - 59.0% $ 110,562 $ — CBREI Venture 5.0% - 64.0% 85,386 — Canadian Pension Plan Investment Board 55.0% 36,223 36,312 Brandywine 30.0% 13,753 — Berkshire Group 50.0% 27,647 — MRP Realty 70.0% 1,802 — JP Morgan 5.0% 9,351 9,335 Other 242 129 Total investments in unconsolidated real estate ventures 284,966 45,776 Advances to unconsolidated real estate ventures 20 — Total investments in and advances to unconsolidated real estate ventures $ 284,986 $ 45,776 _______________ (1) We classify our investments in and advances to unconsolidated real estate ventures by real estate venture partner with which we may have multiple investments with varying ownership interests. The following is a summary of the debt of our unconsolidated real estate ventures as of September 30, 2017 and December 31, 2016 : Weighted Average Interest Rate Balance as of September 30, September 30, December 31, (In thousands) Variable rate (1) 4.08% $ 531,989 $ 31,000 Fixed rate (2) 3.90% 643,801 273,000 Unconsolidated real estate ventures - mortgages payable 1,175,790 304,000 Unamortized deferred financing costs, net (860 ) (1,034 ) Unconsolidated real estate ventures - mortgages payable, net $ 1,174,930 $ 302,966 ______________ (1) Includes variable rate mortgages payable with interest rate caps. (2) Includes variable rate mortgages payable with interest rates effectively fixed pursuant to interest rate swaps. The following is a summary of the financial information for our unconsolidated real estate ventures, as of September 30, 2017 and December 31, 2016 and for the three and nine months ended September 30, 2017 and 2016 : September 30, December 31, 2016 Combined balance sheet information: (In thousands) Total assets $ 3,446,348 $ 598,239 Total liabilities 1,253,664 327,862 Noncontrolling interests 343 343 Total equity 2,192,341 270,034 Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Combined income statement information: (In thousands) Total revenue $ 46,830 $ 16,364 $ 83,387 $ 51,066 Net (loss) income (5,191 ) 2,607 (414 ) 5,083 |
Other Assets, Net (Tables)
Other Assets, Net (Tables) | 9 Months Ended |
Sep. 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 September 30, 2017 and December 31, 2016 : September 30, December 31, (In thousands) Deferred leasing costs $ 168,344 $ 157,258 Accumulated amortization (66,403 ) (57,910 ) Deferred leasing costs, net 101,941 99,348 Prepaid expenses 21,942 2,199 Identified intangible assets, net 143,000 3,063 Other 21,508 8,345 Total other assets, net $ 288,391 $ 112,955 |
Summary of Identified Intangible Assets, Net | The following is a summary of the composition of identified intangible assets, net as of September 30, 2017 and December 31, 2016 : September 30, December 31, Identified intangible assets: (in thousands) In-place leases $ 72,081 $ 12,777 Above-market real estate leases 12,473 773 Below-market ground leases 2,874 2,215 Option to enter into ground lease 17,090 — Management and leasing contracts 57,800 — Other 206 206 Total identified intangibles assets 162,524 15,971 Accumulated amortization: In-place leases 15,187 10,871 Above-market real estate leases 1,082 612 Below-market ground leases 1,344 1,278 Management and leasing contracts 1,753 — Other 158 147 Total accumulated amortization 19,524 12,908 Identified intangible assets, net $ 143,000 $ 3,063 |
Summary of Amortization Expense | The following is a summary of amortization expense included in the statements of operations related to identified intangible assets for the three and nine months ended September 30, 2017 and 2016 : Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (in thousands) In-place lease amortization (1) $ 4,104 $ 233 $ 4,347 $ 336 Above-market real estate lease amortization (2) 448 20 471 64 Below-market ground lease amortization (3) 23 21 66 64 Management and leasing contract amortization (1) 1,753 — 1,753 — Other amortization (1) 3 22 10 69 Total identified intangible asset amortization $ 6,331 $ 296 $ 6,647 $ 533 ___________________________________________ (1) Amounts are included in "Depreciation and amortization expenses" in our statements of operations. (2) Amounts are included in "Property rentals revenue" in our statements of operations. (3) Amounts are included in "Property operating expenses" in our statements of operations. |
Schedule of Estimated Amortization of Identified Intangible Assets | As of September 30, 2017 , the estimated amortization of identified intangible assets is as follows for each of the five years commencing January 1, 2018: Year ending December 31, Amount (in thousands) 2018 $ 15,119 2019 12,032 2020 10,105 2021 6,664 2022 5,312 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Summary of Mortgages Payable | The following is a summary of mortgages payable as of September 30, 2017 and December 31, 2016 : Weighted Average Interest Rate Balance as of September 30, September 30, December 31, (In thousands) Variable rate (1) 2.95% $ 1,152,106 $ 547,291 Fixed rate (2) 4.79% 836,141 620,327 Mortgages payable (3) 1,988,247 1,167,618 Unamortized deferred financing costs and premium/discount, net (10,573 ) (2,604 ) Mortgages payable, net $ 1,977,674 $ 1,165,014 Payable to former parent (4) — $ — $ 283,232 __________________________ (1) Includes variable rate mortgages payable with interest rate caps. (2) Includes variable rate mortgages payable with interest rates effectively fixed pursuant to rate swaps. (3) Includes mortgages payable assumed as part of the Combination. See Note 3 to the financial statements for additional information. (4) In June 2016, the mortgage loan for the Bowen Building was repaid with proceeds of a $115.6 million draw on our former parent's revolving credit facility collateralized by an interest in the property, and, accordingly, was reflected as a component of "Payable to former parent" on the combined balance sheets as of December 31, 2016 . We repaid the loan with amounts drawn under our revolving credit facility collateralized by a mortgage on the property. The following is a summary of amounts outstanding under the credit facility as of September 30, 2017 : Interest Rate Balance as of September 30, September 30, (In thousands) Revolving credit facility (1) 2.34% $ 115,751 Tranche A-1 Term Loan 2.44% $ 50,000 Unamortized deferred financing costs, net (3,611 ) Unsecured term loan, net $ 46,389 __________________________ (1) As of September 30, 2017 , letters of credit with an aggregate face amount of $5.2 million were provided under our revolving credit facility. |
Schedule of Maturities of Debt Outstanding | Principal maturities of debt outstanding as of September 30, 2017 , including mortgages payable, the Tranche A-1 Term Loan and borrowings on the revolving credit facility, are as follows: Year ending December 31, Amount (In thousands) 2017 $ — 2018 376,019 2019 227,919 2020 215,096 2021 215,592 2022 327,500 Thereafter 791,872 Total $ 2,153,998 |
Other Liabilities, Net (Tables)
Other Liabilities, Net (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Other Liabilities Disclosure [Abstract] | |
Composition of Other Liabilities, Net | The following is a summary of other liabilities, net as of September 30, 2017 and December 31, 2016 : September 30, December 31, (In thousands) Lease intangible liabilities $ 44,965 $ 36,515 Accumulated amortization (26,287 ) (24,945 ) Lease intangible liabilities, net 18,678 11,570 Prepaid rent 12,445 9,163 Lease assumptions liabilities and accrued tenant incentives 12,090 14,907 Capital lease obligation 15,976 — Security deposits 13,795 10,324 Ground lease deferred rent payable 3,559 3,331 Deferred tax liability (1) 22,007 — Other 2,224 192 Total other liabilities, net $ 100,774 $ 49,487 ___________________________________________ (1) As of September 30, 2017 , the deferred tax liability of $22.0 million is related to the management and leasing contracts assumed in the Combination. See Note 3 for additional information. |
Finite-lived Intangible Liabilities Amortization Expense | The following is a summary of amortization expense included in the statements of operations related to lease intangible liabilities: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (in thousands) Lease intangible liabilities amortization (1) $ 633 $ 359 $ 1,343 $ 1,076 ___________________________________________ (1) Amounts are included in "Property rentals" in our statements of operations. |
Schedule of Finite-Lived Intangible Liabilities, Future Amortization Expense | As of September 30, 2017 , the estimated amortization of lease intangible liabilities is as follows for each of the five years commencing January 1, 2018: Year ending December 31, Amount (in thousands) 2018 $ 2,765 2019 2,679 2020 2,392 2021 1,917 2022 1,798 |
Redeemable Noncontrolling Int34
Redeemable Noncontrolling Interests (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Noncontrolling Interest [Abstract] | |
Redeemable Noncontrolling Interests | Below is a summary of the activity of redeemable noncontrolling interests for the nine months ended September 30, 2017 : Nine Months Ended September 30, 2017 (In thousands) Balance at January 1, 2017 (1) $ — OP Units issued at the Separation 96,632 OP Units issued in connection with the Combination (2) 359,967 Net loss attributable to redeemable noncontrolling interests (2,481 ) Share-based compensation expense 15,799 Adjustment to redemption value 97,084 Balance as of September 30, 2017 $ 567,001 __________________ (1) We did not have any redeemable noncontrolling interests prior to the Separation on July 17, 2017. (2) Excludes certain OP Units issued as part of the Combination which have an estimated fair value of $ 110.6 million , that are subject to post-combination employment with vesting over periods of either 12 or 60 months. See Note 11 for further information. |
Share-Based Payments and Empl35
Share-Based Payments and Employee Benefits (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan | Share-based compensation expense for the nine months ended September 30, 2017 is summarized as follows (in thousands): Formation Awards $ 3,963 LTIP Units that vested immediately 2,546 OP Units (1) 7,936 Share-based compensation related to Formation Transaction (2) 14,445 LTIP Units that vest over four years 885 OPP Units 469 Other equity awards 1,526 Share-based compensation expense - other (3) 2,880 Total share-based compensation expense 17,325 Less amount capitalized (161 ) Net share-based compensation expense (4) $ 17,164 ______________________________________________ (1) Represents share-based compensation expense for OP Units subject to post-combination employment. See Note 3 for further information. (2) Included in "General and administrative expense: share-based compensation related to Formation Transaction" in the accompanying statements of operations. (3) Included in "General and administrative expense" in the accompanying statements of operations. (4) Net share-based compensation expense for the three months ended September 30, 2017 was $16.0 million . |
(Loss) Earnings Per Share (Tabl
(Loss) Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following summarizes the calculation of basic and diluted EPS and provides a reconciliation of the amounts of net (loss) income available to common shareholders and shares of common stock used in calculating basic and diluted EPS for the three and nine months ended September 30, 2017 and 2016 : Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands, except per share amounts) Net (loss) income attributable to JBG SMITH Properties $ (69,831 ) $ 21,014 $ (57,851 ) $ 49,344 Weighted average shares outstanding — basic and diluted (1) 114,744 100,571 105,347 100,571 (Loss) earnings per share available to common shareholders: Basic $ (0.61 ) $ 0.21 $ (0.55 ) $ 0.49 Diluted $ (0.61 ) $ 0.21 $ (0.55 ) $ 0.49 _______________ (1) Reflects the weighted average common shares outstanding as of the date of the Separation in all periods prior to July 17, 2017. |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] | The number of securities that were excluded from the calculation of diluted (loss) earnings per share because they were antidilutive that potentially could be dilutive in the future are included in the following table: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 OP Units 3,281 — 3,281 — Formation Awards 2,681 — 2,681 — LTIP Units 410 — 410 — OPP Units 605 — 605 — |
Future Minimum Rental Income (T
Future Minimum Rental Income (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Leases [Abstract] | |
Schedule of Future Minimum Rental Income | As of September 30, 2017 , future base rental revenue under these non-cancelable operating leases excluding extension options is as follows: Year ending December 31, Amount (In thousands) 2017 $ 133,025 2018 387,636 2019 310,230 2020 277,278 2021 234,005 2022 195,750 Thereafter 868,284 As of September 30, 2017 , future minimum rental payments under non-cancelable operating and capital leases are as follows: Year ending December 31, Amount (In thousands) 2017 $ 1,974 2018 8,391 2019 8,170 2020 7,825 2021 7,496 2022 6,580 Thereafter 874,467 Total $ 914,903 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following are liabilities measured at fair value on a recurring basis as of September 30, 2017 : Fair Value Measurements Total Level 1 Level 2 Level 3 September 30, 2017 (In thousands) Interest rate swaps and caps: Classified as liabilities in "Other liabilities, net" $ 703 $ — $ 703 $ — |
Schedule of Financial Instruments and Liabilities as Reflected on Balance Sheet | As of September 30, 2017 and December 31, 2016 , all financial instruments and liabilities were reflected in our balance sheets at amounts which, in our estimation, reasonably approximated their fair values, except for the following: September 30, 2017 December 31, 2016 Carrying Amount (1) Fair Value Carrying Amount (1) Fair Value (In thousands) Financial liabilities: Mortgages payable $ 1,988,247 $ 2,015,653 $ 1,167,618 $ 1,192,267 ______________________________________ ( 1) The carrying amount consists of principal only. |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment information | The following table reflects the reconciliation of net (loss) income attributable to JBG SMITH Properties to NOI for the three and nine months ended September 30, 2017 and 2016 : Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Net (loss) income attributable to JBG SMITH Properties $ (69,831 ) $ 21,014 $ (57,851 ) $ 49,344 Add: Depreciation and amortization expense 43,951 31,377 109,726 98,291 General and administrative expense: Corporate and other 10,593 10,913 35,536 36,040 Third-party real estate services 21,178 4,779 30,362 14,272 Share-based compensation related to Formation Transaction 14,445 — 14,445 — Transaction and other costs 104,095 1,528 115,173 1,528 Interest expense 15,309 13,028 43,813 38,662 Loss on extinguishment of debt 689 — 689 — Income tax (benefit) expense (1,034 ) 302 (317 ) 884 Less: Third-party real estate services, including reimbursements 25,141 8,297 38,881 24,617 Other income 1,158 1,564 3,701 3,938 (Loss) income from unconsolidated real estate ventures (1,679 ) 584 (1,365 ) (952 ) Interest and other (loss) income, net (379 ) 749 1,366 2,292 Gain on bargain purchase 27,771 — 27,771 — Net loss attributable to redeemable noncontrolling interests 8,160 — 2,481 — NOI $ 79,223 $ 71,747 $ 218,741 $ 209,126 Below is a summary of NOI by segment for the three and nine months ended September 30, 2017 and 2016 : Three Months Ended September 30, 2017 Office Multifamily Other Eliminations Total (In thousands) Rental revenue: Property rentals $ 91,534 $ 23,397 $ 4,171 $ (2,644 ) $ 116,458 Tenant reimbursements 7,917 1,548 128 — 9,593 Total rental revenue 99,451 24,945 4,299 (2,644 ) 126,051 Rental expense: — Property operating 27,000 6,796 3,502 (7,664 ) 29,634 Real estate taxes 13,038 2,952 1,204 — 17,194 Total rental expense 40,038 9,748 4,706 (7,664 ) 46,828 NOI $ 59,413 $ 15,197 $ (407 ) $ 5,020 $ 79,223 Three Months Ended September 30, 2016 Office Multifamily Other Eliminations Total (In thousands) Rental revenue: Property rentals $ 81,575 $ 15,850 $ 4,898 $ 942 $ 103,265 Tenant reimbursements 8,977 876 378 — 10,231 Total rental revenue 90,552 16,726 5,276 942 113,496 Rental expense: — Property operating 25,083 4,782 3,065 (5,643 ) 27,287 Real estate taxes 11,793 1,663 1,006 14,462 Total rental expense 36,876 6,445 4,071 (5,643 ) 41,749 NOI $ 53,676 $ 10,281 $ 1,205 $ 6,585 $ 71,747 Nine Months Ended September 30, 2017 Office Multifamily Other Eliminations Total (In thousands) Rental revenue: Property rentals $ 249,532 $ 62,050 $ 9,623 $ (4,306 ) $ 316,899 Tenant reimbursements 22,738 3,772 651 — 27,161 Total rental revenue 272,270 65,822 10,274 (4,306 ) 344,060 Rental expense: — Property operating 71,377 16,716 11,330 (22,082 ) 77,341 Real estate taxes 37,185 7,973 2,820 — 47,978 Total rental expense 108,562 24,689 14,150 (22,082 ) 125,319 NOI $ 163,708 $ 41,133 $ (3,876 ) $ 17,776 $ 218,741 Nine Months Ended September 30, 2016 Office Multifamily Other Eliminations Total (In thousands) Rental revenue: Property rentals $ 237,826 $ 45,203 $ 18,621 $ (2,153 ) $ 299,497 Tenant reimbursements 24,807 2,422 1,199 — 28,428 Total rental revenue 262,633 47,625 19,820 (2,153 ) 327,925 Rental expenses: — Property operating 69,740 12,594 14,934 (22,181 ) 75,087 Real estate taxes 34,855 5,063 3,794 — 43,712 Total rental expense 104,595 17,657 18,728 (22,181 ) 118,799 NOI $ 158,038 $ 29,968 $ 1,092 $ 20,028 $ 209,126 The following is a summary of certain balance sheet data by segment as of September 30, 2017 and December 31, 2016 : Office Multifamily Other Eliminations Total September 30, 2017 (In thousands) Real estate, at cost $ 3,867,513 $ 1,434,730 $ 540,287 $ — $ 5,842,530 Investments in and advances to unconsolidated real estate ventures $ 126,620 $ 106,842 $ 51,524 $ — $ 284,986 Total assets $ 3,338,100 $ 1,472,864 $ 1,204,063 $ — $ 6,015,027 December 31, 2016 Real estate, at cost $ 2,798,946 $ 959,404 $ 397,041 $ — $ 4,155,391 Investments in and advances to $ 45,647 $ — $ 129 $ — $ 45,776 Total assets $ 2,388,396 $ 873,157 $ 399,087 $ — $ 3,660,640 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Income | As of September 30, 2017 , future base rental revenue under these non-cancelable operating leases excluding extension options is as follows: Year ending December 31, Amount (In thousands) 2017 $ 133,025 2018 387,636 2019 310,230 2020 277,278 2021 234,005 2022 195,750 Thereafter 868,284 As of September 30, 2017 , future minimum rental payments under non-cancelable operating and capital leases are as follows: Year ending December 31, Amount (In thousands) 2017 $ 1,974 2018 8,391 2019 8,170 2020 7,825 2021 7,496 2022 6,580 Thereafter 874,467 Total $ 914,903 |
Organization and Basis of Pre41
Organization and Basis of Presentation and Combination - Narrative (Details) $ in Millions | Jul. 18, 2017ft²building_unitpropertiesshares | Jul. 17, 2017shares | Jul. 07, 2017 | Sep. 30, 2016USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2017ft²building_unitpropertypropertiesshares |
Real Estate Properties [Line Items] | |||||||
Common stock issued (in shares) | shares | 94,700,000 | 117,957,000 | |||||
Common limited partnership units (in shares) | shares | 5,800,000 | ||||||
Outstanding common shares and common limited partnership units prior to the Combination | shares | 118,000,000 | 117,957,000 | |||||
Common limited partnership units outstanding (in shares) | shares | 19,800,000 | ||||||
Number of real estate properties | properties | 69 | ||||||
Prior period reclassification adjustment | $ | $ 2 | $ 6 | |||||
Other | |||||||
Real Estate Properties [Line Items] | |||||||
Prior period reclassification adjustment | $ | $ 4 | ||||||
General and Administrative Expense | |||||||
Real Estate Properties [Line Items] | |||||||
Prior period reclassification adjustment | $ | $ 4.8 | $ 14.3 | |||||
Asset under Construction | |||||||
Real Estate Properties [Line Items] | |||||||
Number of real estate properties | properties | 9 | ||||||
Near-Term Development | |||||||
Real Estate Properties [Line Items] | |||||||
Number of real estate properties | properties | 1 | ||||||
Future Development | |||||||
Real Estate Properties [Line Items] | |||||||
Number of real estate properties | properties | 42 | ||||||
Area of real estate property (in square feet) | 21,300,000 | ||||||
Office Building | |||||||
Real Estate Properties [Line Items] | |||||||
Number of real estate properties | properties | 51 | ||||||
Area of real estate property (in square feet) | 13,700,000 | ||||||
Office Building | Asset under Construction | |||||||
Real Estate Properties [Line Items] | |||||||
Number of real estate properties | properties | 4 | ||||||
Area of real estate property (in square feet) | 1,300,000 | ||||||
Multifamily | |||||||
Real Estate Properties [Line Items] | |||||||
Number of real estate properties | properties | 14 | ||||||
Number of building units | building_unit | 6,016 | ||||||
Multifamily | Asset under Construction | |||||||
Real Estate Properties [Line Items] | |||||||
Number of real estate properties | properties | 4 | ||||||
Number of building units | building_unit | 1,334 | ||||||
Multifamily | Near-Term Development | |||||||
Real Estate Properties [Line Items] | |||||||
Number of building units | building_unit | 433 | ||||||
Other Property | |||||||
Real Estate Properties [Line Items] | |||||||
Number of real estate properties | properties | 4 | ||||||
Area of real estate property (in square feet) | 765,000 | ||||||
Other Property | Near-Term Development | |||||||
Real Estate Properties [Line Items] | |||||||
Number of real estate properties | property | 1 | ||||||
Area of real estate property (in square feet) | 41,100 | ||||||
Wholly Owned Properties | Future Development | |||||||
Real Estate Properties [Line Items] | |||||||
Area of real estate property (in square feet) | 17,600,000 | ||||||
Wholly Owned Properties | Office Building | |||||||
Real Estate Properties [Line Items] | |||||||
Area of real estate property (in square feet) | 11,800,000 | ||||||
Wholly Owned Properties | Office Building | Asset under Construction | |||||||
Real Estate Properties [Line Items] | |||||||
Area of real estate property (in square feet) | 1,200,000 | ||||||
Wholly Owned Properties | Multifamily | |||||||
Real Estate Properties [Line Items] | |||||||
Number of building units | building_unit | 4,232 | ||||||
Wholly Owned Properties | Multifamily | Asset under Construction | |||||||
Real Estate Properties [Line Items] | |||||||
Number of building units | building_unit | 1,149 | ||||||
Wholly Owned Properties | Multifamily | Near-Term Development | |||||||
Real Estate Properties [Line Items] | |||||||
Number of building units | building_unit | 303 | ||||||
Wholly Owned Properties | Other Property | |||||||
Real Estate Properties [Line Items] | |||||||
Area of real estate property (in square feet) | 348,000 | ||||||
Wholly Owned Properties | Other Property | Near-Term Development | |||||||
Real Estate Properties [Line Items] | |||||||
Area of real estate property (in square feet) | 4,100 | ||||||
JBG Smith, LP | |||||||
Real Estate Properties [Line Items] | |||||||
Ownership interest | 85.60% | 85.60% | |||||
JBG Companies | |||||||
Real Estate Properties [Line Items] | |||||||
Common shares and OP Units issued in consideration | shares | 37,164,000 | ||||||
Outstanding common shares and common limited partnership units prior to the Combination | shares | 100,571,000 | ||||||
Number of real estate properties | properties | 30 | ||||||
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 | ||||||
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 | ||||||
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 | ||||||
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 | ||||||
JBG Companies | Multifamily | |||||||
Real Estate Properties [Line Items] | |||||||
Number of real estate properties | properties | 9 | ||||||
Number of building units | building_unit | 2,883 | ||||||
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 | ||||||
JBG Companies | Wholly Owned Properties | Asset under Construction | |||||||
Real Estate Properties [Line Items] | |||||||
Area of real estate property (in square feet) | 2,200,000 | ||||||
JBG Companies | Wholly Owned Properties | Near-Term Development | |||||||
Real Estate Properties [Line Items] | |||||||
Area of real estate property (in square feet) | 242,000 | ||||||
JBG Companies | Wholly Owned Properties | Future Development | |||||||
Real Estate Properties [Line Items] | |||||||
Area of real estate property (in square feet) | 8,500,000 | ||||||
JBG Companies | Wholly Owned Properties | Office Building | |||||||
Real Estate Properties [Line Items] | |||||||
Area of real estate property (in square feet) | 2,300,000 | ||||||
JBG Companies | Wholly Owned Properties | Multifamily | |||||||
Real Estate Properties [Line Items] | |||||||
Number of building units | building_unit | 1,099 | ||||||
JBG Companies | Wholly Owned Properties | Other Property | |||||||
Real Estate Properties [Line Items] | |||||||
Area of real estate property (in square feet) | 73,000 | ||||||
JBG Companies | Common Shares | |||||||
Real Estate Properties [Line Items] | |||||||
Common shares and OP Units issued in consideration | shares | 23,300,000 | ||||||
JBG Companies | Partnership units | |||||||
Real Estate Properties [Line Items] | |||||||
Common shares and OP Units issued in consideration | shares | 13,900,000 | ||||||
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 Pre42
Organization and Basis of Presentation and Combination - Schedule of Revenue by Major Customer (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 152,350 | $ 123,357 | $ 386,642 | $ 356,480 |
U.S. federal government | Office segment revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of revenue | 22.60% | 30.50% | 25.30% | 28.50% |
U.S. federal government | Total revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of revenue | 17.80% | 24.30% | 20.00% | 22.90% |
U.S. federal government | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 22,492 | $ 27,594 | $ 68,869 | $ 74,939 |
Summary of Significant Accoun43
Summary of Significant Accounting Policies - Narrative (Details) | 9 Months Ended |
Sep. 30, 2017 | |
Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives (in years) | 3 years |
Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives (in years) | 40 years |
The Combination - Narrative (De
The Combination - Narrative (Details) shares in Thousands, $ in Thousands | Jul. 18, 2017USD ($)ft²building_unitpropertiespersonshares | Sep. 30, 2017USD ($)ft²building_unitpropertyproperties | Sep. 30, 2017USD ($)ft²building_unitpropertyproperties | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)ft²building_unitpropertyproperties | Sep. 30, 2016USD ($) |
Business Acquisition [Line Items] | ||||||
Vesting period (in years) | 5 years | |||||
Number of real estate properties | properties | 69 | 69 | 69 | |||
Gain on bargain purchase | $ | $ 27,771 | $ 0 | $ 27,771 | $ 0 | ||
Transaction and other costs | $ | 104,095 | 1,528 | 115,173 | 1,528 | ||
Repayment of notes receivable | $ | 50,934 | 0 | ||||
JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Common shares and OP Units issued in consideration | shares | 37,164 | |||||
Number of real estate properties | properties | 30 | |||||
Severance and transaction bonus expense | $ | $ 34,300 | 34,300 | 34,300 | |||
Investment banking fees | $ | 33,600 | 33,600 | ||||
Legal fees | $ | 13,100 | 13,100 | ||||
Accounting fees | $ | 8,100 | 8,000 | ||||
Number of unrelated owners | person | 20 | |||||
Number of owners turned employees | person | 19 | |||||
Number of owners turned board of trustee members | person | 3 | |||||
Gain on bargain purchase | $ | $ 27,771 | 27,771 | 27,800 | 27,800 | 27,800 | |
Transaction and other costs | $ | $ 121,600 | $ 1,528 | $ 1,528 | |||
Revenue of JBG included in statement of operations | $ | 34,900 | 34,900 | ||||
Net loss of JBG included in statement of operations | $ | 7,800 | $ 7,800 | ||||
Repayment of notes receivable | $ | $ 50,934 | |||||
Office Building | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 51 | 51 | 51 | |||
Area of real estate property (in square feet) | 13,700,000 | 13,700,000 | 13,700,000 | |||
Office Building | JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 19 | |||||
Area of real estate property (in square feet) | 3,600,000 | |||||
Multifamily | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 14 | 14 | 14 | |||
Number of building units | building_unit | 6,016 | 6,016 | 6,016 | |||
Multifamily | JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 9 | |||||
Number of building units | building_unit | 2,883 | |||||
Other Property | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 4 | 4 | 4 | |||
Area of real estate property (in square feet) | 765,000 | 765,000 | 765,000 | |||
Other Property | JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 2 | |||||
Area of real estate property (in square feet) | 490,000 | |||||
Wholly Owned Properties | Office Building | ||||||
Business Acquisition [Line Items] | ||||||
Area of real estate property (in square feet) | 11,800,000 | 11,800,000 | 11,800,000 | |||
Wholly Owned Properties | Office Building | JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Area of real estate property (in square feet) | 2,300,000 | |||||
Wholly Owned Properties | Multifamily | ||||||
Business Acquisition [Line Items] | ||||||
Number of building units | building_unit | 4,232 | 4,232 | 4,232 | |||
Wholly Owned Properties | Multifamily | JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Number of building units | building_unit | 1,099 | |||||
Wholly Owned Properties | Other Property | ||||||
Business Acquisition [Line Items] | ||||||
Area of real estate property (in square feet) | 348,000 | 348,000 | 348,000 | |||
Wholly Owned Properties | Other Property | JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Area of real estate property (in square feet) | 73,000 | |||||
Asset under Construction | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 9 | 9 | 9 | |||
Asset under Construction | JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 11 | |||||
Area of real estate property (in square feet) | 2,500,000 | |||||
Asset under Construction | Office Building | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 4 | 4 | 4 | |||
Area of real estate property (in square feet) | 1,300,000 | 1,300,000 | 1,300,000 | |||
Asset under Construction | Multifamily | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 4 | 4 | 4 | |||
Number of building units | building_unit | 1,334 | 1,334 | 1,334 | |||
Asset under Construction | Wholly Owned Properties | JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Area of real estate property (in square feet) | 2,200,000 | |||||
Asset under Construction | Wholly Owned Properties | Office Building | ||||||
Business Acquisition [Line Items] | ||||||
Area of real estate property (in square feet) | 1,200,000 | 1,200,000 | 1,200,000 | |||
Asset under Construction | Wholly Owned Properties | Multifamily | ||||||
Business Acquisition [Line Items] | ||||||
Number of building units | building_unit | 1,149 | 1,149 | 1,149 | |||
Near-Term Development | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 1 | 1 | 1 | |||
Near-Term Development | JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 2 | |||||
Area of real estate property (in square feet) | 401,000 | |||||
Near-Term Development | Multifamily | ||||||
Business Acquisition [Line Items] | ||||||
Number of building units | building_unit | 433 | 433 | 433 | |||
Near-Term Development | Other Property | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | property | 1 | 1 | 1 | |||
Area of real estate property (in square feet) | 41,100 | 41,100 | 41,100 | |||
Near-Term Development | Wholly Owned Properties | JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Area of real estate property (in square feet) | 242,000 | |||||
Near-Term Development | Wholly Owned Properties | Multifamily | ||||||
Business Acquisition [Line Items] | ||||||
Number of building units | building_unit | 303 | 303 | 303 | |||
Near-Term Development | Wholly Owned Properties | Other Property | ||||||
Business Acquisition [Line Items] | ||||||
Area of real estate property (in square feet) | 4,100 | 4,100 | 4,100 | |||
Future Development | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 42 | 42 | 42 | |||
Area of real estate property (in square feet) | 21,300,000 | 21,300,000 | 21,300,000 | |||
Future Development | JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Number of real estate properties | properties | 26 | |||||
Area of real estate property (in square feet) | 11,700,000 | |||||
Future Development | Wholly Owned Properties | ||||||
Business Acquisition [Line Items] | ||||||
Area of real estate property (in square feet) | 17,600,000 | 17,600,000 | 17,600,000 | |||
Future Development | Wholly Owned Properties | JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Area of real estate property (in square feet) | 8,500,000 | |||||
Transaction and other costs | JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Transaction and other costs | $ | $ 104,095 | $ 115,173 |
The Combination - Fair Value of
The Combination - Fair Value of Assets Acquired and Liabilities Assumed (Details) $ in Thousands | Jul. 25, 2017USD ($) | Jul. 18, 2017USD ($)unit | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) |
Fair value of assets acquired and liabilities assumed: | ||||||
Gain on bargain purchase | $ 27,771 | $ 0 | $ 27,771 | $ 0 | ||
Repayment of notes receivable | 50,934 | 0 | ||||
Land parcel purchase price | $ 19,500 | |||||
JBG Companies | ||||||
Business Combination, Consideration Transferred [Abstract] | ||||||
Common shares and OP Units | $ 1,224,886 | |||||
Cash | 20,573 | |||||
Total consideration paid | 1,245,459 | |||||
Fair value of assets acquired and liabilities assumed: | ||||||
Land and improvements | 342,932 | |||||
Building and improvements | 623,889 | |||||
Construction in progress, including land | 632,664 | |||||
Leasehold improvements and equipment | 7,890 | |||||
Cash | 104,516 | |||||
Restricted cash | 13,460 | |||||
Investments in and advances to unconsolidated real estate ventures | 238,388 | |||||
Identified intangible assets | 146,600 | |||||
Notes receivable | 50,934 | |||||
Identified intangible liabilities | (8,449) | |||||
Mortgages payable assumed | (768,523) | |||||
Capital lease obligations assumed | (33,543) | |||||
Deferred tax liability | (21,476) | |||||
Other liabilities acquired, net | (52,065) | |||||
Noncontrolling interests in consolidated subsidiaries | (3,987) | |||||
Net assets acquired | 1,273,230 | |||||
Gain on bargain purchase | $ 27,771 | 27,771 | $ 27,800 | $ 27,800 | $ 27,800 | |
Repayment of notes receivable | $ 50,934 | |||||
Ground leases that qualify as capital leases | unit | 2 |
The Combination - Fair Value 46
The Combination - Fair Value of Common Shares and OP Units Purchase Consideration (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 18, 2017 | Sep. 30, 2017 | Jul. 17, 2017 |
Business Acquisition [Line Items] | |||
Outstanding common shares and common limited partnership units prior to the Combination | 118,000,000 | 117,957,000 | |
Vesting period (in years) | 5 years | ||
JBG Companies | |||
Business Acquisition [Line Items] | |||
Outstanding common shares and common limited partnership units prior to the Combination | 100,571,000 | ||
Exchange ratio | 271.00% | ||
Common shares and OP Units issued in consideration | 37,164,000 | ||
Price per share/unit | $ 37.10 | ||
Fair value of common shares and OP Units issued in consideration | $ 1,378,780 | ||
Fair value adjustment to OP Units due to transfer restrictions | (43,303) | ||
Portion of consideration attributable to performance of future services | (110,591) | ||
Common shares and OP Units | 1,224,886 | ||
OP Units | |||
Business Acquisition [Line Items] | |||
Fair value of common shares and OP Units issued in consideration | 3,300 | ||
Portion of consideration attributable to performance of future services | $ (110,600) | ||
OP Units | Minimum | |||
Business Acquisition [Line Items] | |||
Vesting period (in years) | 12 years | ||
OP Units | Maximum | |||
Business Acquisition [Line Items] | |||
Vesting period (in years) | 60 months |
The Combination - Fair Value 47
The Combination - Fair Value of Definite-lived Assets and Liabilities (Details) - JBG Companies - USD ($) $ in Thousands | Jul. 18, 2017 | Sep. 30, 2017 |
Finite-Lived Intangible Assets [Line Items] | ||
Building and improvements | $ 559,042 | |
Tenant improvements | 64,847 | |
Total building and improvements | 623,889 | |
Leasehold improvements | 4,422 | |
Identified intangible assets | $ 146,600 | |
Weighted average amortization period (in years) | 10 years 2 months | |
Below-market real estate leases | $ 8,449 | |
In-place leases | ||
Finite-Lived Intangible Assets [Line Items] | ||
Identified intangible assets | $ 59,351 | |
Weighted average amortization period (in years) | 6 years 5 months | |
Above-market real estate leases | ||
Finite-Lived Intangible Assets [Line Items] | ||
Identified intangible assets | $ 11,700 | |
Weighted average amortization period (in years) | 6 years 3 months | |
Below-market ground leases | ||
Finite-Lived Intangible Assets [Line Items] | ||
Identified intangible assets | $ 659 | |
Weighted average amortization period (in years) | 88 years 6 months | |
Option to enter into ground lease | ||
Finite-Lived Intangible Assets [Line Items] | ||
Identified intangible assets | $ 17,090 | |
Management and leasing contracts | ||
Finite-Lived Intangible Assets [Line Items] | ||
Identified intangible assets | $ 57,800 | |
Weighted average amortization period (in years) | 7 years 5 months | |
Minimum | Building and improvements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life (in years) | 3 years | |
Minimum | Management and leasing contracts | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life (in years) | 3 years | |
Maximum | Building and improvements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life (in years) | 40 years | |
Maximum | Management and leasing contracts | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life (in years) | 8 years |
The Combination - Pro Forma Inf
The Combination - Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Business Combinations [Abstract] | ||||
Total revenue | $ 160,428 | $ 170,498 | $ 481,314 | $ 492,874 |
Net income (loss) attributable to JBG SMITH Properties | $ 2,283 | $ 803 | $ (13,741) | $ (26,701) |
Earnings (loss) per common share: Basic | $ 0.02 | $ 0.01 | $ (0.13) | $ (0.27) |
Earnings (loss) per common share: Diluted | $ 0.02 | $ 0.01 | $ (0.13) | $ (0.27) |
Tenant and Other Receivables, N
Tenant and Other Receivables, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Receivables [Abstract] | |||||
Tenants | $ 32,106 | $ 32,106 | $ 26,278 | ||
Other | 23,835 | 23,835 | 11,314 | ||
Allowance for doubtful accounts | (5,467) | (5,467) | (4,212) | ||
Total tenant and other receivables, net | 50,474 | 50,474 | $ 33,380 | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Bad debt expense | $ 1,100 | $ 1,808 | $ 618 | ||
Property Operating Expenses | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Bad debt expense | $ 106 | $ 618 |
Investments in Unconsolidated50
Investments in Unconsolidated Real Estate Ventures - Summary of Composition of Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Schedule of Equity Method Investments [Line Items] | ||
Total investments in unconsolidated real estate ventures | $ 284,966 | $ 45,776 |
Advances to unconsolidated real estate ventures | 20 | 0 |
Investment Balance | 284,986 | 45,776 |
Landmark | ||
Schedule of Equity Method Investments [Line Items] | ||
Total investments in unconsolidated real estate ventures | 110,562 | 0 |
CBREI Venture | ||
Schedule of Equity Method Investments [Line Items] | ||
Total investments in unconsolidated real estate ventures | $ 85,386 | 0 |
Canadian Pension Plan Investment Board | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership Interest | 55.00% | |
Total investments in unconsolidated real estate ventures | $ 36,223 | 36,312 |
Brandywine | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership Interest | 30.00% | |
Total investments in unconsolidated real estate ventures | $ 13,753 | 0 |
Berkshire Group | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership Interest | 50.00% | |
Total investments in unconsolidated real estate ventures | $ 27,647 | 0 |
MRP Realty | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership Interest | 70.00% | |
Total investments in unconsolidated real estate ventures | $ 1,802 | 0 |
JP Morgan | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership Interest | 5.00% | |
Total investments in unconsolidated real estate ventures | $ 9,351 | 9,335 |
Other | ||
Schedule of Equity Method Investments [Line Items] | ||
Total investments in unconsolidated real estate ventures | $ 242 | $ 129 |
Minimum | Landmark | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership Interest | 1.80% | |
Minimum | CBREI Venture | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership Interest | 5.00% | |
Maximum | Landmark | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership Interest | 59.00% | |
Maximum | CBREI Venture | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership Interest | 64.00% |
Investments in Unconsolidated51
Investments in Unconsolidated Real Estate Ventures - Summary of Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Schedule of Equity Method Investments [Line Items] | ||
Unconsolidated real estate ventures - mortgages payable | $ 1,175,790 | $ 304,000 |
Unamortized deferred financing costs, net | (860) | (1,034) |
Unconsolidated real estate ventures - mortgages payable, net | $ 1,174,930 | 302,966 |
Mortgages | ||
Schedule of Equity Method Investments [Line Items] | ||
Variable rate, weighted average interest rate | 4.08% | |
Variable rate | $ 531,989 | 31,000 |
Fixed rate, weighted average interest rate | 3.90% | |
Fixed rate | $ 643,801 | $ 273,000 |
Investments in Unconsolidated52
Investments in Unconsolidated Real Estate Ventures - Condensed Combined Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Combined balance sheet information: | |||||
Total assets | $ 3,446,348 | $ 3,446,348 | $ 598,239 | ||
Total liabilities | 1,253,664 | 1,253,664 | 327,862 | ||
Noncontrolling interests | 343 | 343 | 343 | ||
Total equity | 2,192,341 | 2,192,341 | $ 270,034 | ||
Combined income statement information: | |||||
Total revenue | 46,830 | $ 16,364 | 83,387 | $ 51,066 | |
Net (loss) income | $ (5,191) | $ 2,607 | $ (414) | $ 5,083 |
Variable Interest Entities (Det
Variable Interest Entities (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Assets | $ 203 | $ 42.4 |
Variable Interest Entity, Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Assets | 78.8 | |
Liabilities | $ 5.1 |
Other Assets, Net - Summary of
Other Assets, Net - Summary of Other Assets, Net (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Deferred leasing costs | $ 168,344 | $ 157,258 |
Accumulated amortization | (66,403) | (57,910) |
Deferred leasing costs, net | 101,941 | 99,348 |
Prepaid expenses | 21,942 | 2,199 |
Identified intangible assets, net | 143,000 | 3,063 |
Other | 21,508 | 8,345 |
Total other assets, net | $ 288,391 | $ 112,955 |
Other Assets, Net - Schedule of
Other Assets, Net - Schedule of Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
Total identified intangibles assets | $ 162,524 | $ 15,971 |
Total accumulated amortization | 19,524 | 12,908 |
Identified intangible assets, net | 143,000 | 3,063 |
In-place leases | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total identified intangibles assets | 72,081 | 12,777 |
Total accumulated amortization | 15,187 | 10,871 |
Above-market real estate leases | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total identified intangibles assets | 12,473 | 773 |
Total accumulated amortization | 1,082 | 612 |
Below-market ground leases | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total identified intangibles assets | 2,874 | 2,215 |
Total accumulated amortization | 1,344 | 1,278 |
Option to enter into ground lease | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total identified intangibles assets | 17,090 | 0 |
Management and leasing contracts | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total identified intangibles assets | 57,800 | 0 |
Total accumulated amortization | 1,753 | 0 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total identified intangibles assets | 206 | 206 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total accumulated amortization | $ 158 | $ 147 |
Other Assets, Net - Summary o56
Other Assets, Net - Summary of Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Total identified intangible asset amortization | $ 6,331 | $ 296 | $ 6,647 | $ 533 |
In-place leases | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total identified intangible asset amortization | 4,104 | 233 | 4,347 | 336 |
Above-market real estate leases | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total identified intangible asset amortization | 448 | 20 | 471 | 64 |
Below-market ground leases | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total identified intangible asset amortization | 23 | 21 | 66 | 64 |
Management and leasing contracts | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total identified intangible asset amortization | 1,753 | 0 | 1,753 | 0 |
Other | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Total identified intangible asset amortization | $ 3 | $ 22 | $ 10 | $ 69 |
Other Assets, Net - Schedule 57
Other Assets, Net - Schedule of Estimated Amortization of Identified Intangible Assets (Details) $ in Thousands | Sep. 30, 2017USD ($) |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
2,018 | $ 15,119 |
2,019 | 12,032 |
2,020 | 10,105 |
2,021 | 6,664 |
2,022 | $ 5,312 |
Debt - Schedule of Mortgages Pa
Debt - Schedule of Mortgages Payable (Details) - USD ($) $ in Thousands | 1 Months Ended | 9 Months Ended | |
Jun. 30, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | |||
Payable to former parent | $ 0 | $ 283,232 | |
Mortgages | |||
Debt Instrument [Line Items] | |||
Variable interest rate | 2.95% | ||
Fixed interest rate | 4.79% | ||
Interest rate on payable to Vornado | 0.00% | ||
Variable rate amount | $ 1,152,106 | 547,291 | |
Fixed rate amount | 836,141 | 620,327 | |
Mortgages payable | 1,988,247 | 1,167,618 | |
Unamortized deferred financing costs and premium/discount, net | (10,573) | (2,604) | |
Mortgages payable, net | 1,977,674 | 1,165,014 | |
Payable to former parent | 0 | $ 283,232 | |
Revolving credit facility | |||
Debt Instrument [Line Items] | |||
Proceeds from Vornado's revolving credit facility | $ 115,600 | $ 5,200 |
Debt - Narrative (Details)
Debt - Narrative (Details) | Jul. 18, 2017USD ($)extension_option | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) |
Line of Credit Facility [Line Items] | |||||
Loss on extinguishment of debt | $ (689,000) | $ 0 | $ (689,000) | $ 0 | |
Mortgages | |||||
Line of Credit Facility [Line Items] | |||||
Net carrying value of real estate collateralizing the mortgages payable | 3,900,000,000 | $ 3,900,000,000 | |||
Repayment of mortgages payable | 181,700,000 | ||||
Line of credit | |||||
Line of Credit Facility [Line Items] | |||||
Credit facility, maximum borrowing capacity | $ 1,400,000,000 | ||||
Fees and expenses on debt | 11,200,000 | ||||
Line of credit | Revolving credit facility | |||||
Line of Credit Facility [Line Items] | |||||
Credit facility, maximum borrowing capacity | $ 1,000,000,000 | ||||
Number of debt extension options | extension_option | 2 | ||||
Debt extension option period (in months) | 6 months | ||||
Unsecured term loan, net | $ 115,800,000 | ||||
Line of credit | Tranche A-1 Term Loan | |||||
Line of Credit Facility [Line Items] | |||||
Credit facility, maximum borrowing capacity | 200,000,000 | ||||
Unsecured term loan, net | 50,000,000 | ||||
Line of credit | Tranche A-2 Term Loan | |||||
Line of Credit Facility [Line Items] | |||||
Credit facility, maximum borrowing capacity | $ 200,000,000 | ||||
Minimum | LIBOR | Line of credit | Revolving credit facility | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 1.10% | ||||
Minimum | LIBOR | Line of credit | Tranche A-1 Term Loan | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 1.20% | ||||
Minimum | LIBOR | Line of credit | Tranche A-2 Term Loan | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 1.55% | ||||
Maximum | LIBOR | Line of credit | Revolving credit facility | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 1.50% | ||||
Maximum | LIBOR | Line of credit | Tranche A-1 Term Loan | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 1.70% | ||||
Maximum | LIBOR | Line of credit | Tranche A-2 Term Loan | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 2.35% | ||||
JBG Companies | |||||
Line of Credit Facility [Line Items] | |||||
Mortgages payable assumed | $ 768,523,000 | ||||
JBG Companies | Mortgages | |||||
Line of Credit Facility [Line Items] | |||||
Repayment of mortgages payable | $ 63,700,000 |
Debt - Summary of Amounts Outst
Debt - Summary of Amounts Outstanding under the Credit Facility (Details) - USD ($) $ in Thousands | 1 Months Ended | 9 Months Ended | |
Jun. 30, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | |
Line of Credit Facility [Line Items] | |||
Unsecured term loan, net | $ 115,751 | $ 0 | |
Revolving credit facility | |||
Line of Credit Facility [Line Items] | |||
Interest Rate | 2.34% | ||
Proceeds from lines of credit | $ 115,600 | $ 5,200 | |
Tranche A-1 Term Loan | |||
Line of Credit Facility [Line Items] | |||
Interest Rate | 2.44% | ||
Line of credit | |||
Line of Credit Facility [Line Items] | |||
Unsecured term loan, net | $ 46,389 | ||
Unamortized deferred financing costs and premium/discount, net | (3,611) | ||
Line of credit | Revolving credit facility | |||
Line of Credit Facility [Line Items] | |||
Unsecured term loan, net | 115,751 | ||
Line of credit | Tranche A-1 Term Loan | |||
Line of Credit Facility [Line Items] | |||
Unsecured term loan, net | $ 50,000 |
Debt - Schedule of Principal Ma
Debt - Schedule of Principal Maturities Outstanding (Details) $ in Thousands | Sep. 30, 2017USD ($) |
Debt Disclosure [Abstract] | |
2,017 | $ 0 |
2,018 | 376,019 |
2,019 | 227,919 |
2,020 | 215,096 |
2,021 | 215,592 |
2,022 | 327,500 |
Thereafter | 791,872 |
Total | $ 2,153,998 |
Other Liabilities, Net - Summar
Other Liabilities, Net - Summary of Other Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Other Liabilities Disclosure [Abstract] | ||
Lease intangible liabilities | $ 44,965 | $ 36,515 |
Accumulated amortization | (26,287) | (24,945) |
Lease intangible liabilities, net | 18,678 | 11,570 |
Prepaid rent | 12,445 | 9,163 |
Lease assumptions liabilities and accrued tenant incentives | 12,090 | 14,907 |
Capital lease obligation | 15,976 | 0 |
Security deposits | 13,795 | 10,324 |
Ground lease deferred rent payable | 3,559 | 3,331 |
Deferred tax liability | 22,007 | 0 |
Other | 2,224 | 192 |
Total other liabilities, net | $ 100,774 | $ 49,487 |
Other Liabilities, Net - Summ63
Other Liabilities, Net - Summary of Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Management and leasing contracts | ||||
Schedule of Other Liabilities [Line Items] | ||||
Lease intangible liabilities amortization | $ 633 | $ 359 | $ 1,343 | $ 1,076 |
Other Liabilities, Net - Schedu
Other Liabilities, Net - Schedule of Finite-Lived Intangible Liabilities, Future Amortization Expense (Details) $ in Thousands | Sep. 30, 2017USD ($) |
Other Liabilities Disclosure [Abstract] | |
2,018 | $ 2,765 |
2,019 | 2,679 |
2,020 | 2,392 |
2,021 | 1,917 |
2,022 | $ 1,798 |
Redeemable Noncontrolling Int65
Redeemable Noncontrolling Interests - Narrative (Details) - shares shares in Millions | Jul. 18, 2017 | Sep. 30, 2017 |
JBG Smith, LP | ||
Noncontrolling Interest [Line Items] | ||
Ownership interest | 85.60% | 85.60% |
OP Units | ||
Noncontrolling Interest [Line Items] | ||
Common shares and OP Units issued in consideration | 19.8 | |
OP Units | JBG Smith, LP | ||
Noncontrolling Interest [Line Items] | ||
Ownership interest | 14.40% |
Redeemable Noncontrolling Int66
Redeemable Noncontrolling Interests - Summary of the Activity of Redeemable Noncontrolling Interests (Details) - USD ($) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Jul. 18, 2017 | ||
Temporary Equity | ||||
Beginning Balance | $ 0 | |||
OP Units issued | [1] | 96,632 | $ 0 | |
Net loss attributable to redeemable noncontrolling interests | (2,481) | |||
Share-based compensation expense | 15,799 | |||
Adjustment to record redeemable noncontrolling interest at redemption value | [1] | 97,084 | $ 0 | |
Ending Balance | $ 567,001 | |||
Vesting period (in years) | 5 years | |||
Vornado | ||||
Temporary Equity | ||||
OP Units issued | $ 96,632 | |||
JBG Companies | ||||
Temporary Equity | ||||
OP Units issued | $ 359,967 | |||
Portion of consideration attributable to performance of future services | $ 110,591 | |||
OP Units | ||||
Temporary Equity | ||||
Portion of consideration attributable to performance of future services | $ 110,600 | |||
OP Units | Minimum | ||||
Temporary Equity | ||||
Vesting period (in years) | 12 years | |||
OP Units | Maximum | ||||
Temporary Equity | ||||
Vesting period (in years) | 60 months | |||
[1] | See Note 3 for information about assets, liabilities and noncontrolling interests acquired in the Formation Transaction. |
Share-Based Payments and Empl67
Share-Based Payments and Employee Benefits - OP Units (Details) - USD ($) shares in Thousands, $ in Millions | Jul. 18, 2017 | Sep. 30, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period (in years) | 5 years | |
OP Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Portion of consideration attributable to performance of future services | $ 110.6 | |
Fair value of common shares and OP Units issued in consideration | $ 3.3 | |
Vested in period (in units) | 0 | |
Forfeited in period (in units) | 0 | |
OP Units | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period (in years) | 12 years | |
Expected volatility rate | 18.00% | |
Risk-free interest rate | 1.30% | |
Expected life (in years) | 1 year | |
OP Units | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period (in years) | 60 months | |
Expected volatility rate | 27.00% | |
Risk-free interest rate | 1.50% | |
Expected life (in years) | 3 years |
Share-Based Payments and Empl68
Share-Based Payments and Employee Benefits - JBG Smith 2017 Omnibus Share Plan (Details) - Omnibus Share Plan, 2017 - shares shares in Millions | Sep. 30, 2017 | Jul. 17, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares authorized | 10.3 | |
Number of shares available for issuance | 6.6 |
Share-Based Payments and Empl69
Share-Based Payments and Employee Benefits - Formation Awards (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | Jul. 18, 2017 | Sep. 30, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Compensation expense recognition period (in years) | 3 years 5 months | |
Formation Awards | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity grants (in shares) | 2,700 | |
Aggregate notional value of shares granted | $ 100 | |
Weighted average price (in dollars per share) | $ 37.10 | |
Fair value of awards on grant date | $ 23.7 | |
Fair value of awards on grant date (in dollars per unit) | $ 8.84 | |
Expected volatility rate | 26.00% | |
Risk-free interest rate | 2.30% | |
Expected life (in years) | 7 years | |
Compensation expense recognition period (in years) | 5 years | |
Vested in period (in units) | 0 | |
Forfeited in period (in units) | 0 | |
Vesting period one | Formation Awards | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Percentage of vesting rights for each tranche | 25.00% | |
Vesting period two | Formation Awards | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Percentage of vesting rights for each tranche | 50.00% |
Share-Based Payments and Empl70
Share-Based Payments and Employee Benefits - LTIP Units (Details) | Aug. 01, 2017installment$ / sharesshares | Jul. 18, 2017USD ($)personshares | Sep. 30, 2017USD ($) | Sep. 30, 2017USD ($)shares | Sep. 30, 2016USD ($) |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period (in years) | 5 years | ||||
Share-based compensation expense | $ | $ 17,164,000 | $ 3,486,000 | |||
Compensation expense recognition period (in years) | 3 years 5 months | ||||
Long-Term Incentive Partnership Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Equity grants (in shares) | 302,500 | 47,166 | |||
Share-based compensation expense | $ | $ 3,500,000 | ||||
Number of installments | installment | 4 | ||||
Weighted average grant-fair value (in dollars per unit) | $ / shares | $ 33.71 | ||||
Compensation expense recognition period (in years) | 4 years | ||||
Vested in period (in units) | 0 | ||||
Forfeited in period (in units) | 0 | ||||
Long-Term Incentive Partnership Units | Vesting period one | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Percentage of vesting rights for each tranche | 50.00% | ||||
Long-Term Incentive Partnership Units | Vesting period two | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Percentage of vesting rights for each tranche | 50.00% | ||||
Long-Term Incentive Partnership Units | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expected volatility rate | 17.00% | ||||
Risk-free interest rate | 1.30% | ||||
Expected life (in years) | 2 years | ||||
Long-Term Incentive Partnership Units | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expected volatility rate | 19.00% | ||||
Risk-free interest rate | 1.50% | ||||
Expected life (in years) | 3 years | ||||
Trustee | Long-Term Incentive Partnership Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of independent Trustees | person | 7 | ||||
Fair value of awards on grant date | $ | $ 250,000 | ||||
Trustee | Long-Term Incentive Partnership Units | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period (in years) | 31 months | ||||
Trustee | Long-Term Incentive Partnership Units | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period (in years) | 60 months | ||||
Management | Long-Term Incentive Partnership Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Equity grants (in shares) | 59,927 |
Share-Based Payments and Empl71
Share-Based Payments and Employee Benefits - OPP Units (Details) - USD ($) $ / shares in Units, $ in Millions | Aug. 01, 2017 | Sep. 30, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period (in years) | 5 years | |
Compensation expense recognition period (in years) | 3 years 5 months | |
OPP Units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Fair value of awards on grant date (in dollars per unit) | $ 15.95 | |
Equity grants (in shares) | 605,100 | |
Vesting period (in years) | 3 years | |
Fair value of awards on grant date | $ 9.7 | |
Expected volatility rate | 18.00% | |
Dividend yield rate | 2.30% | |
Risk-free interest rate | 1.50% | |
Compensation expense recognition period (in years) | 4 years | |
Vested in period (in units) | 0 | |
Forfeited in period (in units) | 0 | |
OPP Units | Vesting period one | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Percentage of vesting rights for each tranche | 50.00% | |
OPP Units | Vesting period two | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Percentage of vesting rights for each tranche | 50.00% |
Share-Based Payments and Empl72
Share-Based Payments and Employee Benefits - Summary of Share-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation related to Formation Transaction | $ 14,445 | $ 0 | $ 14,445 | $ 0 |
Share-based compensation expense - other | 2,880 | |||
Total share-based compensation expense | 17,325 | |||
Share-based compensation expense | 15,799 | |||
Less amount capitalized | (161) | |||
Net share-based compensation expense | $ 16,000 | 17,164 | ||
Formation Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation related to Formation Transaction | 3,963 | |||
Long-Term Incentive Partnership Units | Vesting period one | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation related to Formation Transaction | 2,546 | |||
Long-Term Incentive Partnership Units | Vesting period two | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation related to Formation Transaction | 885 | |||
OP Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation related to Formation Transaction | 7,936 | |||
OPP Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation related to Formation Transaction | 469 | |||
Other Equity Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation related to Formation Transaction | $ 1,526 |
Share-Based Payments and Empl73
Share-Based Payments and Employee Benefits - Share-Based Compensation Expense Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total unrecognized compensation expense | $ 141,400 | $ 141,400 | ||
Compensation expense recognition period (in years) | 3 years 5 months | |||
Vesting period (in years) | 5 years | |||
Contributions to the 401(k) Plan | $ 401 | $ 868 | $ 3,200 | $ 3,100 |
Long-Term Incentive Partnership Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation expense recognition period (in years) | 4 years |
(Loss) Earnings Per Share - Sch
(Loss) Earnings Per Share - Schedule of Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Earnings Per Share [Abstract] | ||||
Net income (loss) attributable to JBG SMITH Properties | $ (69,831) | $ 21,014 | $ (57,851) | $ 49,344 |
Weighted average number of shares outstanding - basic and diluted | 114,744 | 100,571 | 105,347 | 100,571 |
Basic (in dollars per share) | $ (0.61) | $ 0.21 | $ (0.55) | $ 0.49 |
Diluted (in dollars per share) | $ (0.61) | $ 0.21 | $ (0.55) | $ 0.49 |
(Loss) Earnings Per Share - Nar
(Loss) Earnings Per Share - Narrative (Details) - shares | 3 Months Ended | 9 Months Ended |
Sep. 30, 2017 | Sep. 30, 2017 | |
Earnings Per Share [Abstract] | ||
Antidilutive securities excluded from computation of earnings per share | 13,408 | 4,518 |
(Loss) Earnings Per Share - Ant
(Loss) Earnings Per Share - Antidilutive Securities Excluded (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share | 13,408 | 4,518 | ||
OP Units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share | 3,281 | 0 | 3,281 | 0 |
Formation Awards | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share | 2,681 | 0 | 2,681 | 0 |
Long-Term Incentive Partnership Units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share | 410 | 0 | 410 | 0 |
OPP Units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share | 605 | 0 | 605 | 0 |
Future Minimum Rental Income (D
Future Minimum Rental Income (Details) $ in Thousands | Sep. 30, 2017USD ($) |
Leases [Abstract] | |
2,017 | $ 133,025 |
2,018 | 387,636 |
2,019 | 310,230 |
2,020 | 277,278 |
2,021 | 234,005 |
2,022 | 195,750 |
Thereafter | $ 868,284 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Net unrealized gain (loss) on interest rate swaps and caps | $ 467,000 | $ 0 | |
Interest rate swap and caps | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Net unrealized gain (loss) on interest rate swaps and caps | $ 467,000 | $ 467,000 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Details) - Interest rate swap and caps - Recurring $ in Thousands | Sep. 30, 2017USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Classified as liabilities in Other liabilities, net | $ 703 |
Level 1 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Classified as liabilities in Other liabilities, net | 0 |
Level 2 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Classified as liabilities in Other liabilities, net | 703 |
Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Classified as liabilities in Other liabilities, net | $ 0 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Assets and Liabilities Not Measured at Fair Value (Details) - Mortgages - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Carrying Amount | ||
Financial liabilities: | ||
Mortgages payable | $ 1,988,247 | $ 1,167,618 |
Fair Value | ||
Financial liabilities: | ||
Mortgages payable | $ 2,015,653 | $ 1,192,267 |
Segment Information - Narrative
Segment Information - Narrative (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017USD ($)segment | Dec. 31, 2016USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of reportable segments | segment | 3 | |
Number of operating segments | segment | 3 | |
Total assets | $ | $ 6,015,027 | $ 3,660,640 |
Other | Third-party real estate services | ||
Segment Reporting Information [Line Items] | ||
Total assets | $ | $ 56,000 |
Segment Information - Schedule
Segment Information - Schedule of Reconciliation of Net Income Attributable to Parent (Details) - USD ($) $ in Thousands | Jul. 18, 2017 | Sep. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 |
Business Acquisition [Line Items] | ||||||
Net income (loss) attributable to JBG SMITH Properties | $ (69,831) | $ 21,014 | $ (57,851) | $ 49,344 | ||
Depreciation and amortization | 43,951 | 31,377 | 109,726 | 98,291 | ||
Corporate and other | 10,593 | 10,913 | 35,536 | 36,040 | ||
Third-party real estate services | 21,178 | 4,779 | 30,362 | 14,272 | ||
Share-based compensation related to Formation Transaction | 14,445 | 0 | 14,445 | 0 | ||
Transaction and other costs | 104,095 | 1,528 | 115,173 | 1,528 | ||
Interest expense | 15,309 | 13,028 | 43,813 | 38,662 | ||
Loss on extinguishment of debt | 689 | 0 | 689 | 0 | ||
Income tax (benefit) expense | (1,034) | 302 | (317) | 884 | ||
Third-party real estate services, including reimbursements | 25,141 | 8,297 | 38,881 | 24,617 | ||
Other income | 1,158 | 1,564 | 3,701 | 3,938 | ||
(Loss) income from unconsolidated real estate ventures | (1,679) | 584 | (1,365) | (952) | ||
Interest and other (loss) income, net | (379) | 749 | 1,366 | 2,292 | ||
Gain on bargain purchase | 27,771 | 0 | 27,771 | 0 | ||
Net loss attributable to redeemable noncontrolling interests | 8,160 | 0 | 2,481 | 0 | ||
NOI | 79,223 | 71,747 | 218,741 | 209,126 | ||
JBG Companies | ||||||
Business Acquisition [Line Items] | ||||||
Transaction and other costs | $ 121,600 | 1,528 | 1,528 | |||
Gain on bargain purchase | $ 27,771 | $ 27,771 | $ 27,800 | $ 27,800 | $ 27,800 |
Segment Information - Summary o
Segment Information - Summary of NOI by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Segment Reporting Information [Line Items] | ||||
Property rentals | $ 116,458 | $ 103,265 | $ 316,899 | $ 299,497 |
Tenant reimbursements | 9,593 | 10,231 | 27,161 | 28,428 |
Total rental revenue | 126,051 | 113,496 | 344,060 | 327,925 |
Property operating | 29,634 | 27,287 | 77,341 | 75,087 |
Real estate taxes | 17,194 | 14,462 | 47,978 | 43,712 |
Total rental expense | 46,828 | 41,749 | 125,319 | 118,799 |
NOI | 79,223 | 71,747 | 218,741 | 209,126 |
Operating Segments | Office | ||||
Segment Reporting Information [Line Items] | ||||
Property rentals | 91,534 | 81,575 | 249,532 | 237,826 |
Tenant reimbursements | 7,917 | 8,977 | 22,738 | 24,807 |
Total rental revenue | 99,451 | 90,552 | 272,270 | 262,633 |
Property operating | 27,000 | 25,083 | 71,377 | 69,740 |
Real estate taxes | 13,038 | 11,793 | 37,185 | 34,855 |
Total rental expense | 40,038 | 36,876 | 108,562 | 104,595 |
NOI | 59,413 | 53,676 | 163,708 | 158,038 |
Operating Segments | Multifamily | ||||
Segment Reporting Information [Line Items] | ||||
Property rentals | 23,397 | 15,850 | 62,050 | 45,203 |
Tenant reimbursements | 1,548 | 876 | 3,772 | 2,422 |
Total rental revenue | 24,945 | 16,726 | 65,822 | 47,625 |
Property operating | 6,796 | 4,782 | 16,716 | 12,594 |
Real estate taxes | 2,952 | 1,663 | 7,973 | 5,063 |
Total rental expense | 9,748 | 6,445 | 24,689 | 17,657 |
NOI | 15,197 | 10,281 | 41,133 | 29,968 |
Operating Segments | Other | ||||
Segment Reporting Information [Line Items] | ||||
Property rentals | 4,171 | 4,898 | 9,623 | 18,621 |
Tenant reimbursements | 128 | 378 | 651 | 1,199 |
Total rental revenue | 4,299 | 5,276 | 10,274 | 19,820 |
Property operating | 3,502 | 3,065 | 11,330 | 14,934 |
Real estate taxes | 1,204 | 1,006 | 2,820 | 3,794 |
Total rental expense | 4,706 | 4,071 | 14,150 | 18,728 |
NOI | (407) | 1,205 | (3,876) | 1,092 |
Eliminations | ||||
Segment Reporting Information [Line Items] | ||||
Property rentals | (2,644) | 942 | (4,306) | (2,153) |
Tenant reimbursements | 0 | 0 | 0 | 0 |
Total rental revenue | (2,644) | 942 | (4,306) | (2,153) |
Property operating | (7,664) | (5,643) | (22,082) | (22,181) |
Real estate taxes | 0 | 0 | 0 | |
Total rental expense | (7,664) | (5,643) | (22,082) | (22,181) |
NOI | $ 5,020 | $ 6,585 | $ 17,776 | $ 20,028 |
Segment Information - Summary84
Segment Information - Summary of Certain Balance Sheet Data by Segment (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Segment Reporting Information [Line Items] | ||
Real estate, at cost | $ 5,842,530 | $ 4,155,391 |
Investments in and advances to unconsolidated real estate ventures | 284,986 | 45,776 |
Total assets | 6,015,027 | 3,660,640 |
Operating Segments | Office | ||
Segment Reporting Information [Line Items] | ||
Real estate, at cost | 3,867,513 | 2,798,946 |
Investments in and advances to unconsolidated real estate ventures | 126,620 | 45,647 |
Total assets | 3,338,100 | 2,388,396 |
Operating Segments | Multifamily | ||
Segment Reporting Information [Line Items] | ||
Real estate, at cost | 1,434,730 | 959,404 |
Investments in and advances to unconsolidated real estate ventures | 106,842 | 0 |
Total assets | 1,472,864 | 873,157 |
Operating Segments | Other | ||
Segment Reporting Information [Line Items] | ||
Real estate, at cost | 540,287 | 397,041 |
Investments in and advances to unconsolidated real estate ventures | 51,524 | 129 |
Total assets | 1,204,063 | 399,087 |
Eliminations | ||
Segment Reporting Information [Line Items] | ||
Real estate, at cost | 0 | 0 |
Investments in and advances to unconsolidated real estate ventures | 0 | 0 |
Total assets | $ 0 | $ 0 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
General liability insurance limit | $ 200 |
Property and rental value insurance coverage limit | 2,000 |
Terrorist acts insurance coverage limit | 2,000 |
Nuclear, biological, chemical, and radiological terrorism insurance limit | 2,000 |
Additional capital funding committed amount | 50.6 |
Real Estate Properties [Line Items] | |
Purchase obligation | 707.8 |
Consolidated Properties | |
Real Estate Properties [Line Items] | |
Purchase obligation | 611.1 |
Principal payment guarantees | 89 |
Unconsolidated Properties | |
Real Estate Properties [Line Items] | |
Purchase obligation | 96.7 |
Principal payment guarantees | $ 63.8 |
Commitments and Contingencies86
Commitments and Contingencies - Summary of Future Minimum Rental Payments (Details) $ in Thousands | Sep. 30, 2017USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,017 | $ 1,974 |
2,018 | 8,391 |
2,019 | 8,170 |
2,020 | 7,825 |
2,021 | 7,496 |
2,022 | 6,580 |
Thereafter | 874,467 |
Total | $ 914,903 |
Transactions With Vornado and87
Transactions With Vornado and JBG Legacy Funds (Details) ft² in Thousands | Jul. 18, 2017USD ($) | Aug. 12, 2014USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($)ft² | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Aug. 31, 2014USD ($)ft² |
Related Party Transaction [Line Items] | |||||||||||
Proceeds from repayment of receivable from former parent | $ 75,000,000 | $ 0 | |||||||||
Receivable from former parent | $ 0 | 0 | $ 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 | ||||||||||
Vornado's revolving credit facility | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Proceeds from Vornado's revolving credit facility | $ 115,600,000 | 5,200,000 | |||||||||
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 | 120,000 | $ 457,000 | 1,300,000 | 602,000 | |||||||
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 | 873,000 | 4,500,000 | 13,000,000 | 15,200,000 | |||||||
Affiliate | Financing transactions | Vornado | Financing of the Universal Buildings | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Loan to Vornado | $ 86,000,000 | ||||||||||
Proceeds from repayment of receivable from former parent | 4,000,000 | $ 7,000,000 | |||||||||
Interest Income on loan receivable from Vornado | 130,000 | 830,000 | $ 1,800,000 | 2,300,000 | |||||||
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 | |||||||||
Amount outstanding on note agreements with Vornado | $ 166,500,000 | ||||||||||
Interest expense to Vornado | 365,000 | 1,200,000 | 4,100,000 | 3,000,000 | |||||||
Affiliate | Supervise cleaning, engineering and security services | BMS | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Related party transaction amount | 3,600,000 | $ 3,300,000 | 9,900,000 | $ 9,600,000 | |||||||
Affiliate | Separation and Combination transaction | Vornado | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Service charges | 912,000 | 912,000 | |||||||||
Service revenue | 68,000 | 68,000 | |||||||||
Transaction services, initial period (in months) | 2 years | ||||||||||
Affiliate | Fees from Legacy JBG Funds | Legacy JBG Funds | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Real estate service revenue | $ 8,400,000 | ||||||||||
Trustee | Consulting agreement | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Related party transaction, monthly amount | $ 166,667 | ||||||||||
Transaction services, initial period (in months) | 24 months | ||||||||||
JBG Companies | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Liability incurred in connection with the Combination | $ 4,100,000 | $ 3,600,000 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Thousands | Nov. 09, 2017 | Nov. 01, 2017 | Oct. 31, 2017 | Sep. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | Jul. 18, 2017 | Dec. 31, 2016 |
Subsequent Event [Line Items] | ||||||||
Repayments of borrowings | $ 192,681 | $ 8,871 | ||||||
Tranche A-1 Term Loan | ||||||||
Subsequent Event [Line Items] | ||||||||
Interest Rate | 2.44% | 2.44% | ||||||
Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Dividends declared (in dollars per share) | $ 0.225 | |||||||
Line of credit | Tranche A-1 Term Loan | ||||||||
Subsequent Event [Line Items] | ||||||||
Unsecured term loan, net | $ 50,000 | |||||||
Line of credit | Subsequent Event | Tranche A-1 Term Loan | ||||||||
Subsequent Event [Line Items] | ||||||||
Unsecured term loan, net | $ 50,000 | |||||||
Mortgages | ||||||||
Subsequent Event [Line Items] | ||||||||
Debt | $ 1,977,674 | $ 1,977,674 | $ 1,165,014 | |||||
Repayment of mortgages payable | $ 181,700 | |||||||
1235 South Clark | Mortgages | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Debt | $ 78,000 | |||||||
Term | 10 years | |||||||
Interest Rate | 3.94% | |||||||
220 20th Stree | Mortgages | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Repayments of borrowings | $ 67,300 | |||||||
RTC West | Mortgages | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Unsecured term loan, net | 107,700 | |||||||
800 North Glebe Road | Mortgages | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Unsecured term loan, net | $ 107,500 | |||||||
Atlantic Plumbing | Mortgages | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Term | 5 years | |||||||
Proceeds from debt | $ 100,000 | |||||||
Repayment of mortgages payable | 88,400 | |||||||
Remaining available | 10,000 | |||||||
Debt instrument, face amount | $ 110,000 | |||||||
LIBOR | Atlantic Plumbing | Mortgages | Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Mortgage loan interest rate | 1.50% |