Equity Investments in Unconsolidated Joint Ventures | 9 Months Ended |
Sep. 30, 2013 |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Investments in Unconsolidated Joint Ventures | Equity Investments in Unconsolidated Joint Ventures |
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We have five joint venture agreements whereby we own between 7% and 30% of the equity in the joint venture. We and the joint venture partners have joint approval rights for major decisions, including those regarding property operations. We cannot make significant decisions without our partner’s approval. Accordingly, we account for our interest in the joint ventures using the equity method of accounting. |
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The combined condensed financial information for our unconsolidated joint ventures is summarized as follows: |
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Balance Sheets | | September 30, | | December 31, | | | | | | | | |
2013 | 2012 | | | | | | | | |
| | (In thousands) | | | | | | | | |
ASSETS | | | | | | | | | | | | |
Investment in real estate, net | | $ | 411,947 | | | $ | 796,584 | | | | | | | | | |
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Cash, accounts receivable and other assets | | 28,779 | | | 56,631 | | | | | | | | | |
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Total Assets | | $ | 440,726 | | | $ | 853,215 | | | | | | | | | |
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LIABILITIES AND OWNERS' EQUITY | | | | | | | | | | | | | | |
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Mortgage notes payable | | $ | 177,974 | | | $ | 360,302 | | | | | | | | | |
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Other liabilities | | 7,511 | | | 13,866 | | | | | | | | | |
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Owners' equity | | 255,241 | | | 479,047 | | | | | | | | | |
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Total Liabilities and Owners' Equity | | $ | 440,726 | | | $ | 853,215 | | | | | | | | | |
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RPT's equity investments in unconsolidated joint ventures | | $ | 31,819 | | | $ | 95,987 | | | | | | | | | |
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| | Three Months Ended September 30, | | Nine Months Ended September 30, |
Statements of Operations | | 2013 | | 2012 | | 2013 | | 2012 |
| | (In thousands) |
Total Revenue | | $ | 10,561 | | | $ | 10,476 | | | $ | 32,286 | | | $ | 30,973 | |
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Total Expenses | | 9,589 | | | 10,372 | | | 29,568 | | | 31,003 | |
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Income (loss) before other income and expenses and discontinued operations | | 972 | | | 104 | | | 2,718 | | | (30 | ) |
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Gain on extinguishment of debt | | — | | | 77 | | | — | | | 77 | |
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Income from continuing operations | | 972 | | | 181 | | | 2,718 | | | 47 | |
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Discontinued operations | | | | | | | | | | | | |
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Provision for impairment of long-lived assets | | — | | | — | | | — | | | (712 | ) |
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Gain on extinguishment of debt | | — | | | — | | | — | | | 198 | |
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Gain on sale of land | | — | | | 716 | | | — | | | 716 | |
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Gain (loss) on sale of real estate (1) | | — | | | 28 | | | (21,512 | ) | | (61 | ) |
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Income from discontinued operations | | 215 | | | 1,716 | | | 1,376 | | | 5,296 | |
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Income (loss) from discontinued operations | | 215 | | | 2,460 | | | (20,136 | ) | | 5,437 | |
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Net income (loss) | | $ | 1,187 | | | $ | 2,641 | | | $ | (17,418 | ) | | $ | 5,484 | |
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RPT's share of earnings (loss) from unconsolidated joint ventures (2) | | $ | 387 | | | $ | 975 | | | $ | (5,027 | ) | | $ | 2,481 | |
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(1) | In March, 2013 Ramco/Lion Venture LP sold 12 shopping centers to us. The aggregate purchase price for 100% of the shopping centers was $367.4 million resulting in a loss on the sale of $21.5 million to the joint venture. The properties are located in Florida and Michigan. Three properties remain in this joint venture. | | | | | | | | | | | | | | | |
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(2) | For the three and the nine months ended September 30, 2012, our pro-rata share excludes $33,000 related to the acquisition of the partner's interest in a joint venture. In addition, for the nine months ended September 30, 2012, our pro-rata share excludes $0.43 million in costs associated with the liquidation of a joint venture concurrent with the extinguishment of its debt. The costs are reflected in earnings (loss) from unconsolidated joint ventures on our statement of operations. | | | | | | | | | | | | | | | |
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As of September 30, 2013, we had investments in the following unconsolidated joint ventures: |
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| | Ownership as of | | Total Assets as of | | Total Assets as of | | | | | | |
| | September 30, | | September 30, | | December 31, | | | | | | |
Unconsolidated Entities | | 2013 | | 2013 | | 2012 | | | | | | |
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Ramco/Lion Venture LP (1) | | 30% | | $ | 92,285 | | | $ | 495,585 | | | | | | | |
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Ramco 450 Venture LLC | | 20% | | 294,789 | | | 303,107 | | | | | | | |
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Other Joint Ventures | | 7%-20% | | 53,652 | | | 54,523 | | | | | | | |
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| | | | $ | 440,726 | | | $ | 853,215 | | | | | | | |
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(1) | The decrease in total assets is related to the March, 2013 sale of 12 shopping centers with a book value of $387.3 million. | | | | | | | | | | | | | | | |
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There was no acquisition activity in the nine months ended September 30, 2013 and 2012 by any of our unconsolidated joint ventures. |
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Debt |
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Our unconsolidated joint ventures had the following debt outstanding at September 30, 2013: |
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| Balance | | | | | | | | | | | | | |
Entity Name | Outstanding | | | | | | | | | | | | | |
| (In thousands) | | | | | | | | | | | | | |
Ramco 450 Venture LLC (1) | $ | 139,963 | | | | | | | | | | | | | | |
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Ramco/Lion Venture LP (2) | 30,634 | | | | | | | | | | | | | | |
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Other Joint Ventures (3) | 7,612 | | | | | | | | | | | | | | |
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| $ | 178,209 | | | | | | | | | | | | | | |
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Unamortized premium | (235 | ) | | | | | | | | | | | | | |
Total mortgage debt | $ | 177,974 | | | | | | | | | | | | | | |
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(1) | Maturities range from November 2013 to September 2023 with interest rates ranging from 2.9% to 5.8% | | | | | | | | | | | | | | | |
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(2) | Balance relates to Millennium Park’s mortgage loan which has a maturity date of October 2015 with a 5% interest rate. | | | | | | | | | | | | | | | |
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(3) | Balance relates to Paulding Pavilion’s mortgage loan which has a maturity date of January 2014. The interest rate is variable based on LIBOR plus 3.50%. | | | | | | | | | | | | | | | |
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During the nine months ended September 30, 2013, Ramco 450 Venture LLC refinanced (or repaid): |
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• | the mortgage on The Plaza at Delray with a new 10-year loan in the amount of $46.0 million; | | | | | | | | | | | | | | | |
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• | the mortgage on Olentangy Plaza in the amount of $21.6 million of which our share was $4.3 million; and | | | | | | | | | | | | | | | |
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• | the mortgage on Market Plaza. The new five year loan required the joint venture to pay down the outstanding principal balance from $24.5 million to $16.0 million, of which our 20% share was $1.7 million. | | | | | | | | | | | | | | | |
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Ramco 450 Venture LLC expects to close on a new mortgage on the Chester Springs shopping center prior to the November 1, 2013 due date of the current mortgage. There are no other loans maturing until the first quarter of 2014. |
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Joint Venture Management and Other Fee Income |
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We are engaged by certain of our joint ventures to provide asset management, property management, leasing and investing services for such venture’s respective properties. We receive fees for our services, including a property management fee calculated as a percentage of gross revenues received, and recognize these fees as the services are rendered. |
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The following table provides information for our fees earned which are reported in our condensed consolidated statements of operations: |
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| Three Months Ended September 30, | | Nine Months Ended September 30, | |
| 2013 | | 2012 | | 2013 | | 2012 | |
| (In thousands) | |
Management fees | $ | 389 | | | $ | 636 | | | $ | 1,469 | | | $ | 2,006 | | |
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Leasing fees | 172 | | | 253 | | | 320 | | | 683 | | |
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Construction fees | 5 | | | 132 | | | 53 | | | 246 | | |
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Total | $ | 566 | | | $ | 1,021 | | | $ | 1,842 | | | $ | 2,935 | | |
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