Investments in Unconsolidated Real Estate Joint Ventures | Investments in Unconsolidated Real Estate Joint Ventures The equity method of accounting is used to account for each of the individual joint ventures. We have an ownership interest in the following unconsolidated real estate joint ventures: As of June 30, 2016 Joint Venture Outlet Center Location Ownership % Square Feet (in 000's) Carrying Value of Investment (in millions) Total Joint Venture Debt, Net (in millions) (1) Columbus Columbus, OH 50.0 % 355 $ 36.4 $ — National Harbor National Harbor, MD 50.0 % 339 4.9 86.0 RioCan Canada Various 50.0 % 902 126.8 11.8 Savannah (2) Savannah, GA 50.0 % 419 42.4 95.7 $ 210.5 $ 193.5 Charlotte (3) Charlotte, NC 50.0 % 398 $ (1.6 ) $ 89.6 Galveston/Houston (3) Texas City, TX 50.0 % 353 (2.9 ) 64.8 $ (4.5 ) $ 154.4 As of December 31, 2015 Joint Venture Outlet Center Location Ownership % Square Feet (in 000's) Carrying Value of Investment (in millions) Total Joint Venture Debt, Net (1) Columbus Columbus, OH 50.0 % — $ 21.1 $ — National Harbor National Harbor, MD 50.0 % 339 6.1 85.8 RioCan Canada Various 50.0 % 870 117.2 11.3 Savannah (2) Savannah, GA 50.0 % 377 44.4 87.6 Westgate Glendale, AZ 58.0 % 411 12.3 61.9 $ 201.1 $ 246.6 Charlotte (3) Charlotte, NC 50.0 % 398 $ (1.1 ) $ 89.6 Galveston/Houston (3) Texas City, TX 50.0 % 353 (1.5 ) 64.7 $ (2.6 ) $ 154.3 (1) Net of debt origination costs and including premiums of $2.3 million and $3.3 million as of June 30, 2016 and December 31, 2015, respectively. (2) Based on capital contribution and distribution provisions in the joint venture agreement, we expect our economic interest in the venture's cash flow to be greater than indicated in the Ownership column, which states our legal interest in this venture. As of June 30, 2016 , based upon the liquidation proceeds we would receive from a hypothetical liquidation of our investment based on depreciated book value, our estimated economic interest in the venture was approximately 98% . Our economic interest may fluctuate based on a number of factors, including mortgage financing, partnership capital contributions and distributions, and proceeds from gains or losses of asset sales. (3) The negative carrying value is due to the distributions of proceeds from mortgage loans and quarterly distributions of excess cash flow exceeding the original contributions from the partners. Fees we received for various services provided to our unconsolidated joint ventures were recognized in management, leasing and other services as follows (in thousands): Three months ended Six months ended June 30, June 30, 2016 2015 2016 2015 Fee: Development and leasing $ 353 $ 727 $ 545 $ 1,307 Loan guarantee 182 187 364 383 Management and marketing 797 813 1,544 1,320 Total Fees $ 1,332 $ 1,727 $ 2,453 $ 3,010 Our investments in real estate joint ventures are reduced by the percentage of the profits earned for leasing and development services associated with our ownership interest in each joint venture. Our carrying value of investments in unconsolidated joint ventures differs from our share of the assets reported in the "Summary Balance Sheets - Unconsolidated Joint Ventures" shown below due to adjustments to the book basis, including intercompany profits on sales of services that are capitalized by the unconsolidated joint ventures. The differences in basis (totaling $4.4 million and $3.9 million as of June 30, 2016 and December 31, 2015 , respectively) are amortized over the various useful lives of the related assets. Westgate As described in Note 3, we acquired our partners' interest in the Westgate joint venture and have consolidated the property for financial reporting purposes since the acquisition date. Columbus In June 2016, we opened an approximately 355,000 square foot outlet center in Columbus, Ohio. As of June 30, 2016 , we and our partner had each contributed $35.8 million to fund development activities. The projected total net cost of the development is estimated to be approximately $94.9 million . We are providing property management, marketing and leasing services to the joint venture. During construction, our partner provided development services to the joint venture and we, along with our partner, provided joint leasing services. Savannah In May 2016, we expanded our outlet center in Savannah by approximately 42,000 square feet, bringing the outlet center's total gross leasable area to approximately 419,000 square feet. Condensed combined summary financial information of unconsolidated joint ventures accounted for using the equity method is as follows (in thousands): Condensed Combined Balance Sheets - Unconsolidated Joint Ventures June 30, 2016 December 31, 2015 Assets Land $ 104,123 $ 103,046 Buildings, improvements and fixtures 638,116 615,662 Construction in progress, including land 8,436 62,308 750,675 781,016 Accumulated depreciation (64,556 ) (60,629 ) Total rental property, net 686,119 720,387 Cash and cash equivalents 24,247 28,723 Deferred lease costs, net 18,887 18,399 Prepaids and other assets 16,287 14,455 Total assets $ 745,540 $ 781,964 Liabilities and Owners' Equity Mortgages payable, net $ 347,890 $ 400,935 Accounts payable and other liabilities 28,601 31,805 Total liabilities 376,491 432,740 Owners' equity 369,049 349,224 Total liabilities and owners' equity $ 745,540 $ 781,964 Three months ended Six months ended Condensed Combined Statements of Operations June 30, June 30, - Unconsolidated Joint Ventures 2016 2015 2016 2015 Revenues $ 29,341 $ 26,189 $ 57,039 $ 50,153 Expenses Property operating 11,078 11,167 21,396 20,311 General and administrative 179 90 295 308 Depreciation and amortization 9,408 8,556 18,208 16,378 Total expenses 20,665 19,813 39,899 36,997 Operating income 8,676 6,376 17,140 13,156 Interest expense (2,682 ) (2,216 ) (5,236 ) (3,980 ) Other nonoperating income 2 5 3 13 Net income $ 5,996 $ 4,165 $ 11,907 $ 9,189 The Company and Operating Partnership's share of: Net income $ 3,466 $ 2,046 $ 6,965 $ 4,589 Depreciation expense (real estate related) $ 5,808 $ 5,038 $ 11,147 $ 9,114 |