Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended |
Sep. 30, 2014 | |
Document and Entity Information [Abstract] | ' |
Entity Registrant Name | 'LEPERCQ CORPORATE INCOME FUND L P |
Entity Central Index Key | '0000790877 |
Current Fiscal Year End Date | '--12-31 |
Entity Well-known Seasoned User | 'Yes |
Entity Voluntary Filers | 'No |
Entity Current Reporting Status | 'Yes |
Entity Filer Category | 'Non-accelerated Filer |
Entity Common Stock, Shares Outstanding | 0 |
Document Fiscal Year Focus | '2014 |
Document Fiscal Period Focus | 'Q3 |
Document Type | '10-Q |
Amendment Flag | 'false |
Document Period Ended Date | 30-Sep-14 |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Assets: | ' | ' | ||
Real estate, at cost | $861,763 | $892,621 | ||
Real estate - intangible assets | 153,903 | 154,768 | ||
Real estate, gross | 1,015,666 | 1,047,389 | ||
Less: accumulated depreciation and amortization | 219,242 | [1] | 217,905 | [1] |
Real estate, net | 796,424 | 829,484 | ||
Cash and cash equivalents | 8,274 | 13,164 | ||
Restricted cash | 42,462 | 4,328 | ||
Investment in and advances to non-consolidated entities | 4,789 | 5,098 | ||
Deferred expenses, net | 13,518 | 10,174 | ||
Loans receivable, net | 18,331 | 19,220 | ||
Rent receivable - current | 343 | 1,127 | ||
Rent receivable - deferred | 41,549 | 19,594 | ||
Other assets | 14,823 | 12,250 | ||
Total assets | 940,513 | 914,439 | ||
Liabilities: | ' | ' | ||
Mortgages and notes payable | 328,773 | 339,179 | ||
Co-borrower debt | 135,163 | 91,551 | ||
Related party advances, net | 3,028 | 7,703 | ||
Accounts payable and other liabilities | 8,149 | 7,412 | ||
Accrued interest payable | 1,071 | 1,307 | ||
Deferred revenue - including below market leases, net | 4,898 | 611 | ||
Distributions payable | 14,360 | 13,606 | ||
Prepaid rent | 5,811 | 5,003 | ||
Total liabilities | 501,253 | 466,372 | ||
Commitments and contingencies | ' | ' | ||
Partners' capital | 439,260 | 448,067 | ||
Total liabilities and partners' capital | $940,513 | $914,439 | ||
[1] | Includes accumulated amortization of real estate intangible assets of $48,478 and $44,940 in 2014 and 2013, respectively. |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Gross revenues: | ' | ' | ' | ' |
Rental | $27,206 | $14,283 | $80,890 | $43,521 |
Tenant reimbursements | 2,119 | 1,519 | 6,513 | 4,086 |
Total gross revenues | 29,325 | 15,802 | 87,403 | 47,607 |
Expense applicable to revenues: | ' | ' | ' | ' |
Depreciation and amortization | -6,883 | -5,891 | -20,488 | -17,610 |
Property operating | -3,914 | -2,837 | -10,268 | -8,339 |
General and administrative | -1,744 | -1,100 | -6,033 | -3,582 |
Non-operating income | 924 | 928 | 2,521 | 2,562 |
Interest and amortization expense | -7,105 | -1,836 | -21,002 | -7,955 |
Debt satisfaction charges, net | -90 | -2 | -357 | -1,560 |
Income before provision for income taxes, equity in income (losses) of non-consolidated entities and discontinued operations | 10,513 | 5,064 | 31,776 | 11,123 |
Provision for income taxes | -11 | -1 | -72 | -45 |
Equity in income (losses) of non-consolidated entities | 35 | 4 | 101 | -67 |
Income from continuing operations | 10,537 | 5,067 | 31,805 | 11,011 |
Discontinued operations: | ' | ' | ' | ' |
Income from discontinued operations | 114 | 308 | 875 | 1,467 |
Provision for income taxes | -1 | -6 | -15 | -20 |
Debt satisfaction gains (charges), net | 0 | -2 | 0 | 1,709 |
Gains on sales of properties | 17,944 | 0 | 17,944 | 10,394 |
Impairment charges | 0 | -802 | 0 | -6,781 |
Total discontinued operations | 18,057 | -502 | 18,804 | 6,769 |
Net income | $28,594 | $4,565 | $50,609 | $17,780 |
Income per unit: | ' | ' | ' | ' |
Income from continuing operations (in dollars per share) | $0.15 | $0.09 | $0.47 | $0.23 |
Income (loss) from discontinued operations (in dollars per share) | $0.27 | ($0.01) | $0.27 | $0.14 |
Net income (in dollars per share) | $0.42 | $0.08 | $0.74 | $0.37 |
Weighted-average units outstanding (in shares) | 68,138,463 | 55,409,471 | 68,119,929 | 47,890,512 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Increase (Decrease) in Partners' Capital [Roll Forward] | ' | ' | ' | ' |
Beginning balance, units | ' | ' | 68,280,702 | 44,131,032 |
Beginning balance | ' | ' | $448,067 | $216,544 |
Changes in co-borrower debt | ' | ' | -43,612 | -17,803 |
Redemption of units, units | ' | ' | -170,193 | ' |
Redemption of units | ' | ' | -1,962 | ' |
Distributions | ' | ' | -41,823 | -32,180 |
Net income | 28,594 | 4,565 | 50,609 | 17,780 |
Ending balance, units | 70,682,266 | 61,048,690 | 70,682,266 | 61,048,690 |
Ending balance | $439,260 | $396,488 | $439,260 | $396,488 |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Cash flows from operating activities: | ' | ' |
Net cash provided by operating activities | $29,573 | $30,700 |
Cash flows from investing activities: | ' | ' |
Investments in real estate under construction | -1,994 | -3,972 |
Capital expenditures | -2,827 | -1,301 |
Net proceeds from sale of properties | 40,836 | 30,023 |
Principal payments received on loans receivable | 1,018 | 1,273 |
Investment in non-consolidated entity | -263 | 0 |
Distributions from non-consolidated entities in excess of accumulated earnings | 572 | 265 |
Increase in deferred leasing costs | -3,485 | -755 |
Change in escrow deposits and restricted cash | -38,134 | -4,296 |
Net cash provided by (used in) investing activities | -4,277 | 21,237 |
Cash flows from financing activities: | ' | ' |
Distributions to partners | -19,808 | -1,789 |
Principal amortization payments | -1,406 | -4,343 |
Increase in deferred financing costs | -55 | -1 |
Principal payments on debt, excluding normal amortization | -9,000 | -44,397 |
Related party advances, net | 2,045 | 3,367 |
Redemption of OP units | -1,962 | 0 |
Net cash used in financing activities | -30,186 | -47,163 |
Change in cash and cash equivalents | -4,890 | 4,774 |
Cash and cash equivalents, at beginning of period | 13,164 | 7,347 |
Cash and cash equivalents, at end of period | $8,274 | $12,121 |
The_Partnership_and_Financial_
The Partnership and Financial Statement Presentation | 9 Months Ended |
Sep. 30, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
The Partnership and Financial Statement Presentation | ' |
The Partnership and Financial Statement Presentation | |
Lepercq Corporate Income Fund L.P. (together with its consolidated subsidiaries, except when the context only applies to the parent entity, the “Partnership”) was organized in 1986 as a limited partnership under the Delaware Revised Uniform Limited Partnership Act. The Partnership's sole general partner, Lex GP-1 Trust (the “General Partner”), is a wholly-owned subsidiary of Lexington Realty Trust (“Lexington”). The Partnership serves as an operating partnership subsidiary for Lexington. On December 30, 2013, another operating partnership subsidiary of Lexington, Lepercq Corporate Income Fund II L.P. (“LCIF II”), was merged with and into the Partnership, with the Partnership as the surviving entity. As the merger was between entities under common control, the operations of LCIF II are combined with the Partnership in these unaudited condensed consolidated financial statements at the historical cost basis and all periods presented include the results of operations of LCIF II. As of September 30, 2014 and December 31, 2013, Lexington, through Lex LP-1 Trust, a wholly-owned subsidiary, and the General Partner, owned approximately 95.0% of the outstanding units of the Partnership. | |
The Partnership owns a diversified portfolio of equity and debt investments in single-tenant properties and land. As of September 30, 2014, the Partnership had equity ownership interests in 41 consolidated properties located in 24 states. A majority of the real properties in which the Partnership had an interest and all land interests are generally subject to net leases or similar leases where the tenant pays all or substantially all of the cost, including cost increases, for real estate taxes, insurance, utilities and ordinary maintenance of the property. However, certain leases provide that the landlord is responsible for certain operating expenses. | |
In connection with the merger of LCIF II with and into the Partnership, former LCIF II partners representing 170,193 limited partner interests (“OP units”) elected or were deemed to elect to receive an aggregate amount of $1,962 in cash for such OP units. | |
Basis of Presentation and Consolidation. The Partnership's unaudited condensed consolidated financial statements are prepared on the accrual basis of accounting in accordance with U.S. generally accepted accounting principles (“GAAP”). The financial statements reflect the accounts of the Partnership and its consolidated subsidiaries. The Partnership consolidates its wholly-owned subsidiaries, partnerships and joint ventures which it controls (i) through voting rights or similar rights or (ii) by means other than voting rights if the Partnership is the primary beneficiary of a variable interest entity (“VIE”). Entities which the Partnership does not control and entities which are VIEs in which the Partnership is not the primary beneficiary are accounted for under appropriate GAAP. | |
The financial statements contained in this Quarterly Report on Form 10-Q for the three and nine months ended September 30, 2014 (this “Quarterly Report”) have been prepared by the Partnership in accordance with GAAP for interim financial information and the applicable rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all information and footnotes required by GAAP for complete financial statements. However, in the opinion of management, the interim financial statements include all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the results of the periods presented. The results of operations for the three and nine months ended September 30, 2014 and 2013, are not necessarily indicative of the results that may be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the Partnership's audited consolidated financial statements and notes thereto included in the Partnership's Form 10-K for the year ended December 31, 2013 filed with the SEC on March 17, 2014 (“Annual Report”). | |
Earnings Per Unit. Net income per unit is computed by dividing net income by the weighted-average number of units outstanding during the period. There are no potential dilutive securities. | |
Unit Redemptions. The Partnership's limited partner units that are issued and outstanding, other than those held by Lexington, are currently redeemable at certain times, only at the option of the holders, for shares of beneficial interests of Lexington, par value $0.0001 per share, classified as common stock (“common shares”), on a one to approximately 1.13 basis, subject to future adjustments. These units are not mandatorily redeemable by the Partnership. | |
Allocation of Overhead Expenses. The Partnership does not pay a fee to the General Partner for the day-to-day management of the Partnership. Certain expenses incurred by the General Partner and its affiliates, including Lexington, such as corporate-level interest, amortization of deferred loan costs, payroll and general and administrative expenses are allocated to the Partnership and reimbursed to the General Partner in accordance with the Partnership's partnership agreement. The allocation is based upon gross rental revenues. | |
Distributions; Allocations of Income and Loss. As provided in the Partnership's partnership agreement, distributions and income and loss for financial reporting purposes are allocated to the partners based on their ownership of units. Special allocation rules included in the partnership agreement affect the allocation of taxable income and loss. The Partnership paid or accrued gross distributions of $41,823 ($0.61 per weighted-average unit) and $32,180 ($0.67 per weighted-average unit) to its partners during the nine months ended September 30, 2014 and 2013, respectively. Certain units owned indirectly by Lexington are entitled to aggregate annual distributions of $3.25 per unit. | |
Use of Estimates. The Partnership has made a number of significant estimates and assumptions relating to the reporting of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses to prepare these unaudited condensed consolidated financial statements in conformity with GAAP. These estimates and assumptions are based on management's best estimates and judgment. The Partnership evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. The current economic environment has increased the degree of uncertainty inherent in these estimates and assumptions. The Partnership adjusts such estimates when facts and circumstances dictate. The most significant estimates made include the recoverability of accounts receivable, allocation of property purchase price to tangible and intangible assets acquired and liabilities assumed, the determination of VIEs and which entities should be consolidated, the determination of impairment of long-lived assets, loans receivable and equity method investments and the useful lives of long-lived assets. Actual results could differ materially from those estimates. | |
Fair Value Measurements. The Partnership follows the guidance in the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures ("Topic 820"), to determine the fair value of financial and non-financial instruments. Topic 820 defines fair value, establishes a framework for measuring fair value in GAAP and expands disclosures about fair value measurements. Topic 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, which 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, the Partnership utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible, as well as considering counterparty credit risk. | |
Acquisition, Development and Construction Arrangements. The Partnership evaluates loans receivable where the Partnership participates in residual profits through loan provisions or other contracts to ascertain whether the Partnership has the same risks and rewards as an owner or a joint venture partner. Where the Partnership concludes that such arrangements are more appropriately treated as an investment in real estate, the Partnership reflects such loan receivable as an equity investment in real estate under construction in the consolidated balance sheets. In these cases, no interest income is recorded on the loan receivable and the Partnership records capitalized interest during the construction period. In arrangements where the Partnership engages a developer to construct a property or provide funds to a tenant to develop a property, the Partnership will capitalize the funds provided to the developer/tenant and internal costs of interest and real estate taxes, if applicable, during the construction period. | |
Reclassifications. Certain amounts included in prior years' financial statements have been reclassified to conform to the current year presentation, including certain statements of operations captions including activities for properties sold, which are presented in discontinued operations. | |
Recently Issued Accounting Guidance. In February 2013, the FASB issued Accounting Standards Update 2013-04, Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation is Fixed at the Reporting Date, (“ASU 2013-04”), requiring recognition of such obligations as the sum of (a) the amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors and (b) any additional amount the reporting entity expects to pay on behalf of its co-obligors. The Partnership early adopted this new guidance in 2013 retrospectively (see note 7). | |
In April 2014, the FASB issued Accounting Standards Update No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, which changes the criteria for reporting discontinued operations and improves financial statement disclosures. Under this guidance, only disposals representing a strategic shift in operations that have a major effect on an organization's operations and financial results should be presented as discontinued operations. The new guidance is effective in the first quarter of 2015. It is anticipated that the implementation of this guidance will reduce the number of future property dispositions the Partnership makes, if any, that will be classified as discontinued operations in the Partnership's unaudited condensed consolidated financial statements. | |
In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606), which amends the guidance for revenue recognition to eliminate the industry-specific revenue recognition guidance and replace it with a principle based approach for determining revenue recognition. The new guidance is effective for reporting periods beginning after December 15, 2016. The Partnership is currently evaluating the impact of the adoption of the new guidance on its unaudited condensed consolidated financial statements. |
Investments_in_Real_Estate
Investments in Real Estate | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Real Estate Investments, Net [Abstract] | ' | ||||||||
Investments in Real Estate | ' | ||||||||
Investments in Real Estate | |||||||||
The Partnership's real estate, net, consists of the following at September 30, 2014 and December 31, 2013: | |||||||||
September 30, 2014 | 31-Dec-13 | ||||||||
Real estate, at cost: | |||||||||
Buildings and building improvements | $ | 535,363 | $ | 567,309 | |||||
Land, land estates and land improvements | 322,592 | 325,074 | |||||||
Fixtures and equipment | 84 | 84 | |||||||
Construction in progress | 3,724 | 154 | |||||||
Real estate intangibles: | |||||||||
In-place lease values | 129,616 | 130,387 | |||||||
Tenant relationships | 20,256 | 20,350 | |||||||
Above-market leases | 4,031 | 4,031 | |||||||
1,015,666 | 1,047,389 | ||||||||
Accumulated depreciation and amortization(1) | (219,242 | ) | (217,905 | ) | |||||
Real estate, net | $ | 796,424 | $ | 829,484 | |||||
-1 | Includes accumulated amortization of real estate intangible assets of $48,478 and $44,940 in 2014 and 2013, respectively. | ||||||||
In addition, the Partnership had below-market leases, net of accumulated accretion, which are included in deferred revenue, of $320 and $539, respectively, as of September 30, 2014 and December 31, 2013. |
Sales_of_Real_Estate_and_Disco
Sales of Real Estate and Discontinued Operations | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | ||||||||||||||||
Sales of Real Estate and Discontinued Operations | ' | ||||||||||||||||
Sales of Real Estate and Discontinued Operations | |||||||||||||||||
During the nine months ended September 30, 2014, the Partnership sold its interest in a property for a gross sales price of $41,000 and recognized a gain on sale of property of $17,944. | |||||||||||||||||
During the nine months ended September 30, 2013, the Partnership sold its interests in certain properties for an aggregate gross sales price of $30,945. In addition, the Partnership conveyed its interest in two properties, along with the respective escrow deposits, in satisfaction of an aggregate $29,859 of non-recourse secured mortgage loans and recognized aggregate debt satisfaction gains, net, of $1,709. These dispositions resulted in aggregate gains on sales of properties of $10,394 and impairment charges of $6,781. | |||||||||||||||||
At September 30, 2014, the Partnership had no properties classified as held for sale. | |||||||||||||||||
The following presents the operating results for disposed properties during 2014 and 2013: | |||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Total gross revenues | $ | 276 | $ | 1,313 | $ | 2,006 | $ | 5,460 | |||||||||
Pre-tax net income (loss), including gains on sales | $ | 18,058 | $ | (496 | ) | $ | 18,819 | $ | 6,789 | ||||||||
Loans_Receivable
Loans Receivable | 9 Months Ended | |||||||||||||
Sep. 30, 2014 | ||||||||||||||
Loans Receivable, Net [Abstract] | ' | |||||||||||||
Loans Receivable | ' | |||||||||||||
Loans Receivable | ||||||||||||||
As of September 30, 2014 and December 31, 2013, the Partnership's loans receivable are comprised primarily of mortgage loans on real estate. | ||||||||||||||
The following is a summary of the Partnership's loans receivable as of September 30, 2014 and December 31, 2013: | ||||||||||||||
Loan carrying-value(1) | ||||||||||||||
Loan | 9/30/14 | 12/31/13 | Interest Rate | Maturity Date | ||||||||||
Westmont, IL(2) | $ | 12,326 | $ | 12,610 | 6.45 | % | Oct-15 | |||||||
Southfield, MI | 6,005 | 6,610 | 4.55 | % | Feb-15 | |||||||||
$ | 18,331 | $ | 19,220 | |||||||||||
-1 | Loan carrying value includes accrued interest and is net of origination costs and loan losses, if any. | |||||||||||||
-2 | Borrower is delinquent on debt service payments. Tenant at office property collateral terminated its lease. The Partnership recognized an impairment of $13,939 during the fourth quarter of 2013. During the nine months ended September 30, 2014, the Partnership recognized $1,284 of interest income relating to the impaired loan and the loan had an average recorded investment value of $12,468. At September 30, 2014, the impaired loan receivable had a contractual unpaid balance of $26,265. Subsequent to September 30, 2014, the Partnership commenced a foreclosure proceeding. | |||||||||||||
The Partnership has two types of financing receivables: loans receivable and a capitalized financing lease. The Partnership determined that its financing receivables operate within one portfolio segment as they are within the same industry and use the same impairment methodology. The Partnership's loans receivable are secured by commercial real estate assets and the capitalized financing lease is for a commercial property located in Greenville, South Carolina. In addition, the Partnership assesses all financing receivables for impairment, when warranted, based on an individual analysis of each receivable. | ||||||||||||||
The Partnership's financing receivables operate within one class of financing receivables as these assets (1) are collateralized by commercial real estate and (2) similar metrics are used to monitor the risk and performance of these assets. The Partnership uses credit quality indicators to monitor financing receivables such as quality of collateral, the underlying tenant's credit rating and collection experience. As of September 30, 2014, the financing receivables were performing as anticipated other than the Westmont, Illinois loan as discussed above and there were no significant delinquent amounts outstanding. |
Investments_in_and_Advances_to
Investments in and Advances to Non-Consolidated Entity | 9 Months Ended |
Sep. 30, 2014 | |
Equity Method Investments and Joint Ventures [Abstract] | ' |
Investments in and Advances to Non-Consolidated Entity | ' |
Investments in and Advances to Non-Consolidated Entities | |
In July 2014, the Partnership acquired a 1.0% interest in an office property in Philadelphia, Pennsylvania for $263. The Partnership accounts for this investment under the cost basis of accounting. | |
On September 1, 2012, the Partnership acquired a 2% equity interest in Net Lease Strategic Assets Fund L.P. (“NLS”) for cash of $189 and the issuance of 457,211 limited partner units to Lexington. At the date of acquisition, NLS owned 41 properties totaling 5.8 million square feet in 23 states, plus a 40% tenant-in-common interest in an office property. | |
The Partnership's carrying value in NLS at September 30, 2014 and December 31, 2013 was $4,526 and $5,098, respectively. The Partnership recognized net income (loss) from NLS of $90 and $(67) in equity in income (losses) from non-consolidated entities during the nine months ending September 30, 2014 and 2013, respectively. In addition, the Partnership received distributions of $662 and $265 from NLS during the nine months ending September 30, 2014 and 2013, respectively. |
Fair_Value_Measurements
Fair Value Measurements | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||
Fair Value Measurements | |||||||||||||||||
The following table presents the Partnership's assets and liabilities from continuing operations measured at fair value on a non-recurring basis during the year ended December 31, 2013, aggregated by the level in the fair value hierarchy within which those measurements fall: | |||||||||||||||||
Balance | Fair Value Measurements Using | ||||||||||||||||
Description | 31-Dec-13 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
Impaired loan receivable* | $ | 12,610 | $ | — | $ | — | $ | 12,610 | |||||||||
*Represents a non-recurring fair value measurement. | |||||||||||||||||
There were no non-recurring measurements from continuing operations during the nine months ended September 30, 2014. | |||||||||||||||||
The table below sets forth the carrying amounts and estimated fair values of the Partnership's financial instruments as of September 30, 2014 and December 31, 2013: | |||||||||||||||||
As of September 30, 2014 | As of December 31, 2013 | ||||||||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | ||||||||||||||
Assets | |||||||||||||||||
Loans Receivable (Level 3) | $ | 18,331 | $ | 16,278 | $ | 19,220 | $ | 16,960 | |||||||||
Liabilities | |||||||||||||||||
Debt (Level 3) | $ | 463,936 | $ | 468,906 | $ | 430,730 | $ | 431,573 | |||||||||
The Partnership estimates the fair values of its loans receivable by using an estimated discounted cash flow analysis consisting of scheduled cash flows and discount rate estimates to approximate those that a willing buyer and seller might use and/or the estimated value of the underlying collateral. The fair value of the Partnership's debt is estimated by using a discounted cash flow analysis, based upon estimates of market interest rates. | |||||||||||||||||
Fair values cannot be determined with precision, may not be substantiated by comparison to quoted prices in active markets and may not be realized upon sale. Additionally, there are inherent uncertainties in any fair value measurement technique, and changes in the underlying assumptions used, including discount rates, liquidity risks and estimates of future cash flows, could significantly affect the fair value measurement amounts. | |||||||||||||||||
Cash Equivalents, Restricted Cash, Accounts Receivable and Accounts Payable. The Partnership estimates that the fair value of cash equivalents, restricted cash, accounts receivable and accounts payable approximates carrying value due to the relatively short maturity of the instruments. |
Mortgages_and_Notes_Payable_an
Mortgages and Notes Payable and Co-Borrower Debt | 9 Months Ended |
Sep. 30, 2014 | |
Notes Payable [Abstract] | ' |
Mortgages and Notes Payable and Co-Borrower Debt | ' |
Mortgages and Notes Payable and Co-Borrower Debt | |
The Partnership had outstanding mortgages and notes payable of $328,773 and $339,179 as of September 30, 2014 and December 31, 2013, respectively. Interest rates, including imputed rates, ranged from 4.7% to 6.5% at September 30, 2014 and December 31, 2013 and the mortgages and notes payable mature between 2015 and 2027. The weighted-average interest rate at September 30, 2014 and December 31, 2013 was, in each case, approximately 5.0%. | |
Lexington, and the Partnership as co-borrower, have a $400,000 unsecured revolving credit facility with KeyBank National Association (“KeyBank”), as agent. The unsecured revolving credit facility matures in February 2017 but can be extended until February 2018 at Lexington’s option. The unsecured revolving credit facility bears interest at LIBOR plus 0.95% to 1.725% (1.15% as of September 30, 2014) depending on Lexington's unsecured investment-grade debt rating. At September 30, 2014, the unsecured revolving credit facility had no amounts outstanding, outstanding letters of credit of $16,144 and availability of $383,856, subject to covenant compliance. | |
Lexington, and the Partnership as co-borrower, have a five-year $250,000 unsecured term loan facility from KeyBank, as agent. The unsecured term loan matures in February 2018, may be prepaid without penalty and requires regular payments of interest only at interest rates ranging from LIBOR plus 1.10% to 2.10% (1.35% as of September 30, 2014) depending on Lexington's unsecured investment-grade debt rating. As of September 30, 2014, interest rate swap agreements were entered into to fix the LIBOR component at a weighted-average rate of 1.09% through February 2018 on the $250,000 of outstanding LIBOR-based borrowings. | |
Lexington, and the Partnership as co-borrower, have a $255,000 unsecured term loan from Wells Fargo Bank, National Association (“Wells Fargo”), as agent. The term loan matures in January 2019. The term loan requires regular payments of interest only at interest rates ranging from LIBOR plus 1.50% to 2.25% (1.75% as of September 30, 2014) depending on Lexington's unsecured investment-grade debt rating. Lexington may prepay any outstanding borrowings under the term loan facility at a premium through January 12, 2016 and at par thereafter. Interest rate swap agreements were entered into to fix the LIBOR component at a weighted-average rate of 1.42% through January 2019 on the $255,000 of outstanding LIBOR-based borrowings. | |
Lexington was in compliance with all applicable financial covenants contained in its corporate level debt agreements at September 30, 2014. | |
In accordance with the guidance of ASU 2013-04, the Partnership, as it is a co-borrower with Lexington, recognizes a proportion of the outstanding amounts of the above mentioned term loans and revolving credit facility as co-borrower debt in the accompanying balances sheets. In accordance with the Partnership’s partnership agreement, the Partnership is allocated a portion of these debts based on gross rental revenues, which represents its agreed to obligation. The Partnership's allocated co-borrower debt was $135,163 and $91,551 as of September 30, 2014 and December 31, 2013, respectively. Changes in co-borrower debt are recognized in partners’ capital in the accompanying unaudited condensed consolidated statements of changes in partners’ capital. | |
Mortgages payable and secured loans are generally collateralized by real estate and the related leases. Certain mortgages payable have yield maintenance or defeasance requirements relating to any prepayments. In addition, certain mortgages are cross-collateralized and cross-defaulted. |
Concentration_of_Risk
Concentration of Risk | 9 Months Ended | ||||||
Sep. 30, 2014 | |||||||
Risks and Uncertainties [Abstract] | ' | ||||||
Concentration of Risk | ' | ||||||
Concentration of Risk | |||||||
Subject to the terms of the partnership agreement, the Partnership seeks to reduce its operating and leasing risks through the geographic diversification of its properties, tenant industry diversification, avoidance of dependency on a single asset and the creditworthiness of its tenants. For the nine months ended September 30, 2014 and 2013, the following tenants represented greater than 10% of rental revenues: | |||||||
2014 | 2013 | ||||||
LG-39 Ground Tenant LLC | 16.1 | % | — | % | |||
FC-Canal Ground Tenant LLC | 13.8 | % | — | % | |||
AL-Stone Ground Tenant LLC | 12.6 | % | — | % | |||
The Partnership net leases these individual land parcels to the tenants under non-cancellable 99-year leases. The improvements on these parcels are owned by the tenants under the Partnership leases and currently consist of three high-rise hotels located in New York, NY. The hotels are known as the Element New York Times Square West, the Sheraton Tribeca New York Hotel and the DoubleTree by Hilton Hotel New York City - Financial District, respectively. | |||||||
Cash and cash equivalent balances at certain institutions may exceed insurable amounts. The Partnership believes it mitigates this risk by investing in or through major financial institutions. |
Related_Party_Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2014 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions | ' |
Related Party Transactions | |
The Partnership had the following related party transactions in addition to related party transactions discussed elsewhere in this report and the audited consolidated financial statements in the Annual Report. | |
The Partnership had outstanding net advances owed to Lexington of $3,028 and $7,703 as of September 30, 2014 and December 31, 2013, respectively. The advances are payable on demand. Lexington earned distributions of $39,993 and $30,412 during the nine months ended September 30, 2014 and 2013, respectively. During September 2014 and August 2013, the Partnership issued 2,571,757 and 16,917,658 units, respectfully, to Lexington to satisfy outstanding distributions and advances of $27,981 and $212,147, respectively. | |
The Partnership was allocated interest expense by Lexington, in accordance with the Partnership's partnership agreement, relating to certain lending facilities of $7,336 and $1,550 for the nine months ended September 30, 2014 and 2013, respectively. | |
Lexington, on behalf of the General Partner, pays for certain general administrative and other costs on behalf of the Partnership from time to time. These costs are reimbursable by the Partnership. These costs were approximately $5,640 and $3,522 for the nine months ended September 30, 2014 and 2013, respectively. | |
A Lexington affiliate provides property management services for certain Partnership properties. The Partnership recognized property operating expenses, including from discontinued operations, of $743 and $892 for the nine months ended September 30, 2014 and 2013, respectively, for aggregate fees and reimbursements charged by the affiliate. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies | ' |
Commitments and Contingencies | |
In addition to the commitments and contingencies disclosed elsewhere, the Partnership has the following commitments and contingencies. | |
The Partnership is obligated under certain tenant leases, including its proportionate share for leases for non-consolidated entities, to fund the expansion of the underlying leased properties. During the nine months ended September 30, 2014, the Partnership commenced the expansion of the Byhalia, Mississippi property for an estimated cost of $15,300. The Partnership, under certain circumstances, may guarantee to tenants the completion of base building improvements and the payment of tenant improvement allowances and lease commissions on behalf of its subsidiaries. | |
The Partnership and Lexington are parties to a funding agreement under which each party may be required to fund distributions made on account of OP units or dividends made on account of Lexington common shares. Pursuant to the funding agreement, the parties agreed that, if the Partnership does not have sufficient cash available to make a quarterly distribution to its limited partners in an amount equal to whichever is applicable of (1) a specified distribution set forth in its partnership agreement or (2) the cash dividend payable with respect to a whole or fractional Lexington common share into which the partnership's common units would be converted if they were redeemed for Lexington common shares in accordance with the partnership agreement, Lexington will fund the shortfall. Payments under the agreement will be made in the form of loans to the Partnership and will bear interest at prevailing rates as determined by Lexington in its discretion but no less than the applicable federal rate. The Partnership's right to receive these loans will expire if no OP units remain outstanding and all such loans were repaid. No amounts have been advanced under this agreement. | |
In May 2014, the Partnership guaranteed $250,000 aggregate principal amount of 4.40% Senior Notes due 2024 (“2024 Senior Notes”) issued by Lexington at an issuance price of 99.883% of the principal amount and in June 2013, the Partnership guaranteed $250,000 aggregate principal amount of 4.25% Senior Notes due 2023 (“ 2023 Senior Notes”) issued by Lexington at an issuance price of 99.026% of the principal amount, collectively the Senior Notes. The Senior Notes are unsecured and pay interest semi-annually in arrears. Lexington may redeem the Senior Notes at its option at any time prior to maturity in whole or in part by paying the principal amount of the notes being redeemed plus a premium. In January 2014, the Partnership also guaranteed $250,000 original principal amount of Lexington's 4.25% Senior Notes due 2023 that were registered under the Securities Act of 1933, as amended, and were issued in exchange for the 2023 Senior Notes. | |
During 2010, the Partnership guaranteed $115,000 aggregate principal amount of 6.00% Convertible Guaranteed Notes due 2030 (“Guaranteed Notes”) issued by Lexington. The Guaranteed Notes pay interest semi-annually in arrears and mature in January 2030. The holders of the Guaranteed Notes may require Lexington to repurchase their notes in January 2017, January 2020 and January 2025 for cash equal to 100% of the notes to be repurchased, plus any accrued and unpaid interest. The Guaranteed Notes are convertible by the holders under certain circumstances for cash, Lexington common shares or a combination of cash and common shares at Lexington's election. As of September 30, 2014, $24,786 original principal amount of Guaranteed Notes were outstanding. | |
From time to time, the Partnership is directly or indirectly involved in legal proceedings arising in the ordinary course of the Partnership's business. The Partnership believes, based on currently available information, and after consultation with legal counsel, that although the outcomes of those normal course proceedings are uncertain, the results of such proceedings, in the aggregate, will not have a material adverse effect on the Partnership's business, financial condition and results of operations. |
Supplemental_Disclosure_of_Sta
Supplemental Disclosure of Statement of Cash Flow Information | 9 Months Ended |
Sep. 30, 2014 | |
Supplemental Cash Flow Information [Abstract] | ' |
Supplemental Disclosure of Statement of Cash Flow Information | ' |
Supplemental Disclosure of Statement of Cash Flow Information | |
In addition to disclosures discussed elsewhere, during the nine months ended September 30, 2014 and 2013, the Partnership paid $20,284 and $8,274, respectively, for interest and $100 and $62, respectively, for income taxes. |
Subsequent_Events
Subsequent Events | 9 Months Ended | |
Sep. 30, 2014 | ||
Subsequent Events [Abstract] | ' | |
Subsequent Events | ' | |
Subsequent Events | ||
Subsequent to September 30, 2014 and in addition to disclosures elsewhere in the financial statements, the Partnership: | ||
• | acquired a land parcel in New York, New York, which is net leased for a 99-year term for $30,426. The improvements on the land parcel are owned by the tenant under the Partnership lease and currently consist of a hotel. The Partnership financed the acquisition with an $8,250 non-recourse mortgage provided by a Lexington subsidiary. The interest-only mortgage bears interest at 4.25% and matures in October 2019; and | |
• | acquired an inpatient rehabilitation hospital in Vineland, New Jersey, which is net leased for a 28-year term for $19,100. |
The_Partnership_and_Financial_1
The Partnership and Financial Statement Presentation (Policies) | 9 Months Ended |
Sep. 30, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
Basis of Presentation and Consolidation | ' |
Basis of Presentation and Consolidation. The Partnership's unaudited condensed consolidated financial statements are prepared on the accrual basis of accounting in accordance with U.S. generally accepted accounting principles (“GAAP”). The financial statements reflect the accounts of the Partnership and its consolidated subsidiaries. The Partnership consolidates its wholly-owned subsidiaries, partnerships and joint ventures which it controls (i) through voting rights or similar rights or (ii) by means other than voting rights if the Partnership is the primary beneficiary of a variable interest entity (“VIE”). Entities which the Partnership does not control and entities which are VIEs in which the Partnership is not the primary beneficiary are accounted for under appropriate GAAP. | |
The financial statements contained in this Quarterly Report on Form 10-Q for the three and nine months ended September 30, 2014 (this “Quarterly Report”) have been prepared by the Partnership in accordance with GAAP for interim financial information and the applicable rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all information and footnotes required by GAAP for complete financial statements. However, in the opinion of management, the interim financial statements include all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the results of the periods presented. The results of operations for the three and nine months ended September 30, 2014 and 2013, are not necessarily indicative of the results that may be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the Partnership's audited consolidated financial statements and notes thereto included in the Partnership's Form 10-K for the year ended December 31, 2013 filed with the SEC on March 17, 2014 (“Annual Report”). | |
Earnings Per Unit | ' |
Earnings Per Unit. Net income per unit is computed by dividing net income by the weighted-average number of units outstanding during the period. There are no potential dilutive securities. | |
Unit Redemptions | ' |
Unit Redemptions. The Partnership's limited partner units that are issued and outstanding, other than those held by Lexington, are currently redeemable at certain times, only at the option of the holders, for shares of beneficial interests of Lexington, par value $0.0001 per share, classified as common stock (“common shares”), on a one to approximately 1.13 basis, subject to future adjustments. These units are not mandatorily redeemable by the Partnership. | |
Allocation of Overhead Expenses | ' |
Allocation of Overhead Expenses. The Partnership does not pay a fee to the General Partner for the day-to-day management of the Partnership. Certain expenses incurred by the General Partner and its affiliates, including Lexington, such as corporate-level interest, amortization of deferred loan costs, payroll and general and administrative expenses are allocated to the Partnership and reimbursed to the General Partner in accordance with the Partnership's partnership agreement. The allocation is based upon gross rental revenues. | |
Distributions; Allocations of Income and Loss | ' |
Distributions; Allocations of Income and Loss. As provided in the Partnership's partnership agreement, distributions and income and loss for financial reporting purposes are allocated to the partners based on their ownership of units. Special allocation rules included in the partnership agreement affect the allocation of taxable income and loss. | |
Use of Estimates | ' |
Use of Estimates. The Partnership has made a number of significant estimates and assumptions relating to the reporting of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses to prepare these unaudited condensed consolidated financial statements in conformity with GAAP. These estimates and assumptions are based on management's best estimates and judgment. The Partnership evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. The current economic environment has increased the degree of uncertainty inherent in these estimates and assumptions. The Partnership adjusts such estimates when facts and circumstances dictate. The most significant estimates made include the recoverability of accounts receivable, allocation of property purchase price to tangible and intangible assets acquired and liabilities assumed, the determination of VIEs and which entities should be consolidated, the determination of impairment of long-lived assets, loans receivable and equity method investments and the useful lives of long-lived assets. Actual results could differ materially from those estimates. | |
Fair Value Measurements | ' |
Fair Value Measurements. The Partnership follows the guidance in the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures ("Topic 820"), to determine the fair value of financial and non-financial instruments. Topic 820 defines fair value, establishes a framework for measuring fair value in GAAP and expands disclosures about fair value measurements. Topic 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, which 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, the Partnership utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible, as well as considering counterparty credit risk. | |
Acquisition Development And Construction Arrangements | ' |
Acquisition, Development and Construction Arrangements. The Partnership evaluates loans receivable where the Partnership participates in residual profits through loan provisions or other contracts to ascertain whether the Partnership has the same risks and rewards as an owner or a joint venture partner. Where the Partnership concludes that such arrangements are more appropriately treated as an investment in real estate, the Partnership reflects such loan receivable as an equity investment in real estate under construction in the consolidated balance sheets. In these cases, no interest income is recorded on the loan receivable and the Partnership records capitalized interest during the construction period. In arrangements where the Partnership engages a developer to construct a property or provide funds to a tenant to develop a property, the Partnership will capitalize the funds provided to the developer/tenant and internal costs of interest and real estate taxes, if applicable, during the construction period. | |
Reclassifications | ' |
Reclassifications. Certain amounts included in prior years' financial statements have been reclassified to conform to the current year presentation, including certain statements of operations captions including activities for properties sold, which are presented in discontinued operations. | |
Recently Issued Accounting Guidance | ' |
Recently Issued Accounting Guidance. In February 2013, the FASB issued Accounting Standards Update 2013-04, Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation is Fixed at the Reporting Date, (“ASU 2013-04”), requiring recognition of such obligations as the sum of (a) the amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors and (b) any additional amount the reporting entity expects to pay on behalf of its co-obligors. The Partnership early adopted this new guidance in 2013 retrospectively (see note 7). | |
In April 2014, the FASB issued Accounting Standards Update No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, which changes the criteria for reporting discontinued operations and improves financial statement disclosures. Under this guidance, only disposals representing a strategic shift in operations that have a major effect on an organization's operations and financial results should be presented as discontinued operations. The new guidance is effective in the first quarter of 2015. It is anticipated that the implementation of this guidance will reduce the number of future property dispositions the Partnership makes, if any, that will be classified as discontinued operations in the Partnership's unaudited condensed consolidated financial statements. | |
In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606), which amends the guidance for revenue recognition to eliminate the industry-specific revenue recognition guidance and replace it with a principle based approach for determining revenue recognition. The new guidance is effective for reporting periods beginning after December 15, 2016. The Partnership is currently evaluating the impact of the adoption of the new guidance on its unaudited condensed consolidated financial statements. |
Investments_in_Real_Estate_Tab
Investments in Real Estate (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Real Estate Investments, Net [Abstract] | ' | ||||||||
Schedule of Net Real Estate | ' | ||||||||
The Partnership's real estate, net, consists of the following at September 30, 2014 and December 31, 2013: | |||||||||
September 30, 2014 | 31-Dec-13 | ||||||||
Real estate, at cost: | |||||||||
Buildings and building improvements | $ | 535,363 | $ | 567,309 | |||||
Land, land estates and land improvements | 322,592 | 325,074 | |||||||
Fixtures and equipment | 84 | 84 | |||||||
Construction in progress | 3,724 | 154 | |||||||
Real estate intangibles: | |||||||||
In-place lease values | 129,616 | 130,387 | |||||||
Tenant relationships | 20,256 | 20,350 | |||||||
Above-market leases | 4,031 | 4,031 | |||||||
1,015,666 | 1,047,389 | ||||||||
Accumulated depreciation and amortization(1) | (219,242 | ) | (217,905 | ) | |||||
Real estate, net | $ | 796,424 | $ | 829,484 | |||||
-1 | Includes accumulated amortization of real estate intangible assets of $48,478 and $44,940 in 2014 and 2013, respectively. |
Sales_of_Real_Estate_and_Disco1
Sales of Real Estate and Discontinued Operations (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | ||||||||||||||||
Operating results for disposed properties | ' | ||||||||||||||||
The following presents the operating results for disposed properties during 2014 and 2013: | |||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Total gross revenues | $ | 276 | $ | 1,313 | $ | 2,006 | $ | 5,460 | |||||||||
Pre-tax net income (loss), including gains on sales | $ | 18,058 | $ | (496 | ) | $ | 18,819 | $ | 6,789 | ||||||||
Loans_Receivable_Tables
Loans Receivable (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2014 | ||||||||||||||
Loans Receivable, Net [Abstract] | ' | |||||||||||||
Summary of Loans Receivable | ' | |||||||||||||
The following is a summary of the Partnership's loans receivable as of September 30, 2014 and December 31, 2013: | ||||||||||||||
Loan carrying-value(1) | ||||||||||||||
Loan | 9/30/14 | 12/31/13 | Interest Rate | Maturity Date | ||||||||||
Westmont, IL(2) | $ | 12,326 | $ | 12,610 | 6.45 | % | Oct-15 | |||||||
Southfield, MI | 6,005 | 6,610 | 4.55 | % | Feb-15 | |||||||||
$ | 18,331 | $ | 19,220 | |||||||||||
-1 | Loan carrying value includes accrued interest and is net of origination costs and loan losses, if any. | |||||||||||||
-2 | Borrower is delinquent on debt service payments. Tenant at office property collateral terminated its lease. The Partnership recognized an impairment of $13,939 during the fourth quarter of 2013. During the nine months ended September 30, 2014, the Partnership recognized $1,284 of interest income relating to the impaired loan and the loan had an average recorded investment value of $12,468. At September 30, 2014, the impaired loan receivable had a contractual unpaid balance of $26,265. |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Schedule of Fair Value Measurement Inputs | ' | ||||||||||||||||
The following table presents the Partnership's assets and liabilities from continuing operations measured at fair value on a non-recurring basis during the year ended December 31, 2013, aggregated by the level in the fair value hierarchy within which those measurements fall: | |||||||||||||||||
Balance | Fair Value Measurements Using | ||||||||||||||||
Description | 31-Dec-13 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
Impaired loan receivable* | $ | 12,610 | $ | — | $ | — | $ | 12,610 | |||||||||
*Represents a non-recurring fair value measurement. | |||||||||||||||||
Schedule of Carrying Amounts and Fair Value of Financial Instruments | ' | ||||||||||||||||
The table below sets forth the carrying amounts and estimated fair values of the Partnership's financial instruments as of September 30, 2014 and December 31, 2013: | |||||||||||||||||
As of September 30, 2014 | As of December 31, 2013 | ||||||||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | ||||||||||||||
Assets | |||||||||||||||||
Loans Receivable (Level 3) | $ | 18,331 | $ | 16,278 | $ | 19,220 | $ | 16,960 | |||||||||
Liabilities | |||||||||||||||||
Debt (Level 3) | $ | 463,936 | $ | 468,906 | $ | 430,730 | $ | 431,573 | |||||||||
Concentration_of_Risk_Tables
Concentration of Risk (Tables) | 9 Months Ended | ||||||
Sep. 30, 2014 | |||||||
Risks and Uncertainties [Abstract] | ' | ||||||
Schedule of Concentration of Risk | ' | ||||||
For the nine months ended September 30, 2014 and 2013, the following tenants represented greater than 10% of rental revenues: | |||||||
2014 | 2013 | ||||||
LG-39 Ground Tenant LLC | 16.1 | % | — | % | |||
FC-Canal Ground Tenant LLC | 13.8 | % | — | % | |||
AL-Stone Ground Tenant LLC | 12.6 | % | — | % |
The_Partnership_and_Financial_2
The Partnership and Financial Statement Presentation (Details) (USD $) | 9 Months Ended | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Property | |||
state | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | ' | ' | ' |
Percentage of outstanding units owned | 95.00% | ' | 95.00% |
Number of real estate properties | 41 | ' | ' |
Number of states in which entity operates | 24 | ' | ' |
Par value | $0.00 | ' | ' |
Partners capital equivalent in common shares | 1.13 | ' | ' |
Distributions | $41,823 | $32,180 | ' |
Distribution per weighted average unit | $0.61 | $0.67 | ' |
Distribution per unit of general partner and limited partner interest | $3.25 | ' | ' |
Former LCIF II Partners [Member] | ' | ' | ' |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | ' | ' | ' |
Units exchanged for cash | 170,193 | ' | ' |
Cash received from redeemable OP units | $1,962 | ' | ' |
Investments_in_Real_Estate_Det
Investments in Real Estate (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Real estate, at cost: | ' | ' | ||
Buildings and building improvements | $535,363 | $567,309 | ||
Land, land estates and land improvements | 322,592 | 325,074 | ||
Fixtures and equipment | 84 | 84 | ||
Construction in progress | 3,724 | 154 | ||
Real estate intangibles: | ' | ' | ||
Real estate intangibles | 153,903 | 154,768 | ||
Total real estate at cost and intangibles | 1,015,666 | 1,047,389 | ||
Accumulated depreciation and amortization | -219,242 | [1] | -217,905 | [1] |
Real estate, net | 796,424 | 829,484 | ||
Finite-lived intangible assets, accumulated amortization | 48,478 | 44,940 | ||
Below-market leases, net of accretion | 320 | 539 | ||
Leases, Acquired-in-Place [Member] | ' | ' | ||
Real estate intangibles: | ' | ' | ||
Real estate intangibles | 129,616 | 130,387 | ||
Tenant Relationships [Member] | ' | ' | ||
Real estate intangibles: | ' | ' | ||
Real estate intangibles | 20,256 | 20,350 | ||
Above Market Leases [Member] | ' | ' | ||
Real estate intangibles: | ' | ' | ||
Real estate intangibles | $4,031 | $4,031 | ||
[1] | Includes accumulated amortization of real estate intangible assets of $48,478 and $44,940 in 2014 and 2013, respectively. |
Sales_of_Real_Estate_and_Disco2
Sales of Real Estate and Discontinued Operations (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Property | Property | Property | ||
Discontinued Operations and Disposal Groups [Abstract] | ' | ' | ' | ' |
Proceeds from sale of real estate held-for-investment | ' | ' | $41,000 | $30,945 |
Gain (loss) on disposition of real estate, discontinued operations | ' | ' | 17,944 | 10,394 |
Real estate number of properties transferred | ' | ' | ' | 2 |
Aggregate gross disposition price | ' | ' | ' | 29,859 |
Debt satisfaction gains (charges), net | 0 | -2 | 0 | 1,709 |
Impairment charges in discontinued operations | 0 | 802 | 0 | 6,781 |
Properties classified as held-for-sale | 0 | ' | 0 | ' |
Total gross revenues | 276 | 1,313 | 2,006 | 5,460 |
Pre-tax net income (loss), including gains on sales | $18,058 | ($496) | $18,819 | $6,789 |
Loans_Receivable_Details
Loans Receivable (Details) (USD $) | 9 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' | ||
Loan carrying-value | $18,331 | [1] | $19,220 | [1] |
Number of types of financing receivable | 2 | ' | ||
Number of portfolio segments | 1 | ' | ||
Number of classes of financing receivable | 1 | ' | ||
Westmont, Illinios [Member] | ' | ' | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' | ||
Loan carrying-value | 12,326 | [1],[2] | 12,610 | [1],[2] |
Interest rate | 6.45% | [2] | 6.45% | [2] |
Impaired financing receivable, recorded investment | ' | 13,939 | ||
Interest income from impaired loan | 1,284 | ' | ||
Average recorded investment of impaired loan | 12,468 | ' | ||
Unpaid principal balance on impaired loan | 26,265 | ' | ||
Southfield, Michigan [Member] | ' | ' | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' | ||
Loan carrying-value | $6,005 | [1] | $6,610 | [1] |
Interest rate | 4.55% | 4.55% | ||
[1] | Loan carrying value includes accrued interest and is net of origination costs and loan losses, if any. | |||
[2] | Borrower is delinquent on debt service payments. Tenant at office property collateral terminated its lease. The Partnership recognized an impairment of $13,939 during the fourth quarter of 2013. During the nine months ended SeptemberB 30, 2014, the Partnership recognized $1,284 of interest income relating to the impaired loan and the loan had an average recorded investment value of $12,468. At SeptemberB 30, 2014, the impaired loan receivable had a contractual unpaid balance of $26,265. |
Investments_in_and_Advances_to1
Investments in and Advances to Non-Consolidated Entity (Details) (USD $) | 3 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 1 Months Ended | |||||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 01, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 01, 2012 | Jul. 31, 2014 |
Property | Property | Equity Method Investments [Member] | Equity Method Investments [Member] | Equity Method Investments [Member] | Equity Method Investments [Member] | Equity Method Investments [Member] | Philadelphia Pennsylvania [Member] | |||
state | state | Net Lease Strategic Assets Fund L.P. [Member] | Net Lease Strategic Assets Fund L.P. [Member] | Net Lease Strategic Assets Fund L.P. [Member] | Net Lease Strategic Assets Fund L.P. [Member] | Net Lease Strategic Assets Fund L.P. [Member] | Office Building [Member] | |||
Property | ||||||||||
state | ||||||||||
sqft | ||||||||||
Schedule of Equity Method Investments [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cost Method Investment, Ownership Percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.00% |
Payments to Acquire Cost Method Investments | ' | ' | $263 | $0 | ' | ' | ' | ' | ' | $263 |
Ownership percentage | ' | ' | ' | ' | ' | ' | ' | ' | 2.00% | ' |
Payments to acquire investments | ' | ' | ' | ' | 189 | ' | ' | ' | ' | ' |
Limited partners' capital account, units issued | ' | ' | ' | ' | ' | ' | ' | ' | 457,211 | ' |
Number of real estate properties | 41 | ' | 41 | ' | ' | ' | ' | ' | 41 | ' |
Area of real estate property | ' | ' | ' | ' | ' | ' | ' | ' | 5,800,000 | ' |
Number of states in which entity operates | 24 | ' | 24 | ' | ' | ' | ' | ' | 23 | ' |
Tenant in common interest, ownership percentage | ' | ' | ' | ' | ' | ' | ' | ' | 40.00% | ' |
Partnership carrying value in NLS | ' | ' | ' | ' | ' | 4,526 | ' | 5,098 | ' | ' |
Net income (loss) from NLS | 35 | 4 | 101 | -67 | ' | 90 | -67 | ' | ' | ' |
Distributions received | ' | ' | ' | ' | ' | $662 | $265 | ' | ' | ' |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Loans receivable | $18,331 | [1] | $19,220 | [1] |
Fair Value, Measurements, Nonrecurring [Member] | Estimate of Fair Value Measurement [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Loans receivable | ' | 12,610 | [2] | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value Measurements Using Level 1 [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Loans receivable | ' | 0 | [2] | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value Measurements Using Level 2 [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Loans receivable | ' | 0 | [2] | |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value Measurements Using Level 3 [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Loans receivable | ' | $12,610 | [2] | |
[1] | Loan carrying value includes accrued interest and is net of origination costs and loan losses, if any. | |||
[2] | Represents a non-recurring fair value measurement. |
Fair_Value_Measurements_Detail1
Fair Value Measurements (Details 2) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Assets | ' | ' |
Loans receivable, carrying value (level 3) | $18,331 | $19,220 |
Carrying Amount [Member] | ' | ' |
Assets | ' | ' |
Loans receivable, carrying value (level 3) | 18,331 | 19,220 |
Liabilities | ' | ' |
Debt, carrying value (level 3) | 463,936 | 430,730 |
Fair Value [Member] | ' | ' |
Assets | ' | ' |
Loans receivable, fair value (level 3) | 16,278 | 16,960 |
Liabilities | ' | ' |
Debt, fair value (Level 3) | $468,906 | $431,573 |
Mortgages_and_Notes_Payable_an1
Mortgages and Notes Payable and Co-Borrower Debt (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 |
Minimum [Member] | Minimum [Member] | Maximum [Member] | Maximum [Member] | Unsecured Revolving Credit Facility, Expiring February 2018 [Member] | Unsecured Revolving Credit Facility, Expiring February 2018 [Member] | Unsecured Revolving Credit Facility, Expiring February 2018 [Member] | Unsecured Revolving Credit Facility, Expiring February 2018 [Member] | Term Loan Facility from Key Bank [Member] | Term Loan Facility from Key Bank [Member] | Term Loan Facility from Key Bank [Member] | Term Loan Facility from Key Bank [Member] | Term Loan Facility from Key Bank [Member] | Unsecured Term Loan, Expiring January 2019 [Member] | Unsecured Term Loan, Expiring January 2019 [Member] | Unsecured Term Loan, Expiring January 2019 [Member] | Unsecured Term Loan, Expiring January 2019 [Member] | Unsecured Term Loan, Expiring January 2019 [Member] | |||
Minimum [Member] | Maximum [Member] | Unsecured Revolving Credit Facility [Member] | Minimum [Member] | Maximum [Member] | Unsecured Term Loan [Member] | Interest Rate Swap [Member] | Minimum [Member] | Maximum [Member] | Unsecured Term Loan [Member] | Interest Rate Swap [Member] | ||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Mortgages and notes payable | $328,773,000 | $339,179,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Effective interest rate | ' | ' | 4.70% | 4.70% | 6.50% | 6.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted-average interest rate | 5.00% | 5.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.09% | ' | ' | ' | ' | 1.42% |
Debt instrument amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | 400,000,000 | ' | ' | ' | 250,000,000 | ' | ' | ' | ' | 255,000,000 | ' |
Interest rate stated percentage rate range minimum excluding LIBOR | ' | ' | ' | ' | ' | ' | ' | 0.95% | 1.73% | ' | ' | 1.10% | 2.10% | ' | ' | ' | 1.50% | 2.25% | ' | ' |
Basis spread on variable at the end of the period | ' | ' | ' | ' | ' | ' | 1.15% | ' | ' | ' | 1.35% | ' | ' | ' | ' | 1.75% | ' | ' | ' | ' |
Outstanding letters of credit | 16,144,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of credit facility, remaining borrowing capacity | 383,856,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt instrument, term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' |
Co-borrower debt | $135,163,000 | $91,551,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration_of_Risk_Details
Concentration of Risk (Details) | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Concentration Risk [Line Items] | ' | ' |
Lease term | '99 years | ' |
Number of high rise hotels | 3 | ' |
Tenant Concentration Risk [Member] | Maximum [Member] | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration risk, percentage | 10.00% | 10.00% |
LG 39 Ground Tenant LLC [Member] | Tenant Concentration Risk [Member] | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration risk, percentage | 16.10% | 0.00% |
FC Canal Ground Tenant LLC [Member] | Tenant Concentration Risk [Member] | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration risk, percentage | 13.80% | 0.00% |
AL Stone Ground Tenant LLC [Member] | Tenant Concentration Risk [Member] | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Concentration risk, percentage | 12.60% | 0.00% |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | 9 Months Ended | 1 Months Ended | 9 Months Ended | ||||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Aug. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
General Partner [Member] | General Partner [Member] | General Partner [Member] | General Partner [Member] | ||||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Related party advances, net | $3,028 | ' | $7,703 | ' | ' | ' | ' |
Unit distributions earned | 39,993 | 30,412 | ' | ' | ' | ' | ' |
Distribution made to limited partner and general partner, unit distribution | ' | ' | ' | 2,571,757 | 16,917,658 | 2,571,757 | 16,917,658 |
Partners' capital account, sale of units | ' | ' | ' | 27,981 | 212,147 | 27,981 | 212,147 |
Interest expense | 7,336 | 1,550 | ' | ' | ' | ' | ' |
General and administrative expense | 5,640 | 3,522 | ' | ' | ' | ' | ' |
Property operating expenses | $743 | $892 | ' | ' | ' | ' | ' |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (USD $) | 12 Months Ended | 1 Months Ended | 9 Months Ended | ||||
Dec. 31, 2010 | 31-May-14 | Jun. 30, 2013 | Jan. 31, 2014 | Sep. 30, 2014 | Dec. 31, 2010 | Sep. 30, 2014 | |
Senior Notes [Member] | Senior Notes [Member] | Senior Notes [Member] | Six Percent Convertible Guaranteed Note [Member] | Six Percent Convertible Guaranteed Note [Member] | Byhalia Mississippi [Member] | ||
Senior Notes Due 2024 [Member] | Senior Notes Due 2023 [Member] | Senior Notes Due 2023 [Member] | |||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Payments for capital improvements | ' | ' | ' | ' | ' | ' | $15,300,000 |
Debt instrument amount | ' | 250,000,000 | 250,000,000 | 250,000,000 | ' | 115,000,000 | ' |
Debt instrument, interest rate, stated percentage | ' | 4.40% | 4.25% | 4.25% | ' | 6.00% | ' |
Debt instrument, redemption price, percentage | ' | 99.88% | 99.03% | ' | ' | ' | ' |
Percent of notes required to be repurchased at the option of the holders on set dates | 100.00% | ' | ' | ' | ' | ' | ' |
Convertible notes payable | ' | ' | ' | ' | $24,786,000 | ' | ' |
Supplemental_Disclosure_of_Sta1
Supplemental Disclosure of Statement of Cash Flow Information (Details) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Supplemental Cash Flow Information [Abstract] | ' | ' |
Interest paid | $20,284 | $8,274 |
Income taxes paid | $100 | $62 |
Subsequent_Events_Details
Subsequent Events (Details) (USD $) | 9 Months Ended | 1 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Nov. 07, 2014 | Nov. 07, 2014 |
New York, New York [Member] | Vineland, New Jersey [Member] | ||
Land [Member] | Hospital [Member] | ||
Subsequent Event [Member] | Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ' | ' | ' |
Lease term | '99 years | '99 years | '28 years |
Payments to acquire land | ' | $30,426 | ' |
Mortgage loans on real estate | ' | 8,250 | ' |
Interest rate | ' | 4.25% | ' |
Payments to acquire real estate | ' | ' | $19,100 |