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, 2017 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 $ 6.8 $ 84.3 National Harbor National Harbor, MD 50.0 % 341 2.8 86.3 RioCan Canada Various 50.0 % 924 121.6 11.1 Investments included in total assets $ 131.2 Charlotte (3) Charlotte, NC 50.0 % 398 $ (3.1 ) $ 89.8 Galveston/Houston (2)(3) Texas City, TX 50.0 % 353 (4.9 ) 64.9 Investments included in other liabilities $ (8.0 ) As of December 31, 2016 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 % 355 $ 6.7 $ 84.2 National Harbor National Harbor, MD 50.0 % 341 4.1 86.1 RioCan Canada Various 50.0 % 901 117.3 11.1 Investments included in total assets $ 128.1 Charlotte (3) Charlotte, NC 50.0 % 398 $ (2.5 ) $ 89.7 Galveston/Houston (2)(3) Texas City, TX 50.0 % 353 (3.8 ) 64.9 Investments included in other liabilities $ (6.3 ) (1) Net of debt origination costs and including premiums of $1.3 million and $1.6 million as of June 30, 2017 and December 31, 2016, respectively. (2) In June 2017, the joint venture exercised its extension option and extended the maturity date of the loan from July 2017 to July 2018. In July, the joint venture amended and restated the initial construction loan to increase the amount available to borrow from $70.0 million to $80.0 million and extended the maturity date until July 2020 with two one -year options. The amended and restated loan also changed the interest rate from LIBOR + 1.50% to an interest rate of LIBOR + 1.65% . At the closing of the amendment, the joint venture distributed approximately $14.5 million equally between the partners. (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, 2017 2016 2017 2016 Fee: Management and marketing $ 570 $ 797 1,112 1,544 Development and leasing 35 353 $ 67 $ 545 Loan guarantee 4 182 9 364 Total Fees $ 609 $ 1,332 $ 1,188 $ 2,453 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 $3.7 million for both the period ended June 30, 2017 and the period ended December 31, 2016 ) are amortized over the various useful lives of the related assets. 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, 2017 December 31, 2016 Assets Land $ 90,741 $ 88,015 Buildings, improvements and fixtures 520,223 503,548 Construction in progress, including land under development 8,479 13,037 619,443 604,600 Accumulated depreciation (80,452 ) (67,431 ) Total rental property, net 538,991 537,169 Cash and cash equivalents 24,610 27,271 Deferred lease costs, net 12,216 13,612 Prepaids and other assets 11,522 12,567 Total assets $ 587,339 $ 590,619 Liabilities and Owners' Equity Mortgages payable, net $ 336,387 $ 335,971 Accounts payable and other liabilities 12,905 20,011 Total liabilities 349,292 355,982 Owners' equity 238,047 234,637 Total liabilities and owners' equity $ 587,339 $ 590,619 Three months ended Six months ended Condensed Combined Statements of Operations (1) June 30, June 30, - Unconsolidated Joint Ventures 2017 2016 2017 2016 Revenues $ 23,285 $ 29,341 $ 47,347 $ 57,039 Expenses: Property operating 8,877 11,078 18,255 21,396 General and administrative 96 179 216 295 Depreciation and amortization 6,943 9,408 14,456 18,208 Total expenses 15,916 20,665 32,927 39,899 Operating income 7,369 8,676 14,420 17,140 Interest expense (2,460 ) (2,682 ) (4,720 ) (5,236 ) Other non-operating income 1 2 3 3 Net income $ 4,910 $ 5,996 $ 9,703 $ 11,907 The Company and Operating Partnership's share of: Net income $ 2,374 $ 3,466 $ 4,692 $ 6,965 Depreciation and amortization expense (real estate related) $ 3,550 $ 5,808 $ 7,388 $ 11,147 (1) The three and six months ended June 30, 2017 includes results from the Columbus outlet center, which opened in June 2016. The three and six months ended June 30, 2016 includes results from our Westgate and Savannah outlet centers, which were previously held in unconsolidated joint ventures prior to acquiring our partners' interest in each venture in June 2016 and August 2016, respectively. |