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Note 14 - Noncontrolling Interests | 12 Months Ended
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Dec. 31, 2018
Notes to Financial Statements |
Noncontrolling Interest Disclosure [Text Block] |
14. | Noncontrolling Interests :
Noncontrolling interests represent the portion of equity that the Company does not own in those entities it consolidates as a result of having a controlling interest or determined that the Company was the primary beneficiary of a VIE in accordance with the provisions of the FASB’s Consolidation guidance. The Company accounts and reports for noncontrolling interests in accordance with the Consolidation guidance and the Distinguishing Liabilities from Equity guidance issued by the FASB. The Company identifies its noncontrolling interests separately within the equity section on the Company’s Consolidated Balance Sheets. The amounts of consolidated net income attributable to the Company and to the noncontrolling interests are presented separately on the Company’s Consolidated Statements of Income. During the year ended December 31, 2018, there were various acquisitions and dispositions/liquidations of entities that had an impact on noncontrolling interest. See Footnotes 3, 4, and 8 of the Notes to Consolidated Financial Statements for additional information regarding specific transactions. Included within noncontrolling interests are units that were determined to be contingently redeemable that are classified as Redeemable noncontrolling interests and presented in the mezzanine section between Total liabilities and Stockholder’s equity on the Company’s Consolidated Balance Sheets. The following table presents the change in the redemption value of the Redeemable noncontrolling interests for the years ended December 31, 2018 and 2017 (in thousands):
|  | 20 18 |  |  | 201 7 |
Balance at January 1, |  | $ | 16,143 |  |  | $ | 86,953 |
Issuance of redeemable partnership interests (1) |  |  | - |  |  |  | 10,000 |
Income |  |  | 373 |  |  |  | 1,297 |
Distributions |  |  | (355 | ) |  |  | (2,538 | )
Redemption/conversion of redeemable units (2) |  |  | - |  |  |  | (79,569 | )
Adjustment to estimated redemption value (1) |  |  | 7,521 |  |  |  | - |
Balance at December 31, |  | $ | 23,682 |  |  | $ | 16,143 |
| ( 1 ) | During 2017, KIM Lincoln, a wholly owned subsidiary of the Company, and Lincoln Member entered into a joint venture agreement wherein KIM Lincoln has a 90% controlling interest and Lincoln Member has a 10% noncontrolling interest (See Footnote 4 of the Notes to Consolidated Financial Statements). During the year ended December 31, 2018, the Company recorded an adjustment of $7.5 million to the estimated redemption fair market value of this noncontrolling interest in accordance with the provisions of the joint venture agreement and ASC 480 – Accounting for Redeemable Equity Instruments. The Company revalues the fair market value of this noncontrolling interest on a recurring basis and determined that its valuation was classified within Level 3 of the fair value hierarchy. The estimated fair market value of this noncontrolling interest was based upon a discounted cash flow model, for which a capitalization rate of 5.00% and discount rate of 6.00% were utilized in the model based upon unobservable rates that the Company believes to be within a reasonable range of current market rates.
| ( 2 ) | During 2017, the Company redeemed the remaining 79,642,697 Preferred A Units for a total redemption price of $79.9 million, including an accrued preferred return of $0.4 million. These units, which had a par value of $1.00 and return per annum of 5.0%, were issued in connection with the Puerto Rico shopping center acquisitions discussed below.
The Company owns seven shopping center properties located throughout Puerto Rico. These properties were acquired partially through the issuance of $158.6 million of non-convertible units and $45.8 million of convertible units. Noncontrolling interests related to these acquisitions totaled $233.0 million of units, including premiums of $13.5 million and a fair market value adjustment of $15.1 million (collectively, the "Units"). Since the acquisition date the Company has redeemed a substantial portion of these units. As of December 31, 2018 and 2017, noncontrolling interests relating to the remaining units were $5.2 million. The Units related annual cash distribution rates and related conversion features consisted of the following as of December 31, 2018:
Type |  | Par Value Per Unit |  |  | Number of Units Remaining |  |  | Return Per Annum |
Class B-1 Preferred Units (1) |  | $ | 10,000 |  |  |  | 189 |  |  |  | 7.0% |
Class B-2 Preferred Units (2) |  | $ | 10,000 |  |  |  | 42 |  |  |  | 7.0% |
Class C DownReit Units (1) |  | $ | 30.52 |  |  |  | 52,797 |  |  | Equal to the Company’s common stock dividend |
| ( 1 ) | These units are redeemable for cash by the holder or at the Company’s option, shares of the Company’s common stock, based upon the conversion calculation as defined in the agreement. These units are included in Noncontrolling interests on the Company’s Consolidated Balance Sheets.
| ( 2 ) | These units are redeemable for cash by the holder or callable by the Company and are included in Redeemable noncontrolling interests on the Company’s Consolidated Balance Sheets.
The Company owns a shopping center located in Bay Shore, NY, which was acquired in 2006 with the issuance of 647,758 redeemable Class B Units at a par value of $37.24 per unit. The units accrue a return equal to the Company’s common stock dividend and are redeemable for cash by the holder or at the Company’s option, shares of the Company’s common stock at a ratio of 1:1. These units are callable by the Company any time after April 3, 2026, and are included in Noncontrolling interests on the Company’s Consolidated Balance Sheets. During 2007, 30,000 units, or $1.1 million par value, of the Class B Units were redeemed and at the Company’s option settled in cash. In addition, during 2018 and 2017, 25,970 and 25,000 units, or $1.1 million and $0.9 million par value, respectively, of the Class B Units were redeemed and at the Company’s option settled in cash. As of December 31, 2018 and 2017, noncontrolling interest relating to the remaining Class B Units was $24.3 million and $25.4 million, respectively. Noncontrolling interests also includes 138,015 convertible units issued during 2006 by the Company, which were valued at $5.3 million, including a fair market value adjustment of $0.3 million, related to an interest acquired in an office building located in Albany, NY. These units are currently redeemable at the option of the holder for cash or at the option of the Company for the Company’s common stock at a ratio of 1:1. The holder is entitled to a distribution equal to the dividend rate of the Company’s common stock. The Company was restricted from disposing of these assets, other than through a tax-free transaction, through January 2017.

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- Definition The entire disclosure for noncontrolling interest in consolidated subsidiaries, which could include the name of the subsidiary, the ownership percentage held by the parent, the ownership percentage held by the noncontrolling owners, the amount of the noncontrolling interest, the location of this amount on the balance sheet (when not reported separately), an explanation of the increase or decrease in the amount of the noncontrolling interest, the noncontrolling interest share of the net Income or Loss of the subsidiary, the location of this amount on the income statement (when not reported separately), the nature of the noncontrolling interest such as background information and terms, the amount of the noncontrolling interest represented by preferred stock, a description of the preferred stock, and the dividend requirements of the preferred stock. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -URI http://asc.fasb.org/topic&trid=2197479 + Details
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