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Reportable Segments (UNITED DOMINION REALTY, L.P.)
 3 Months Ended
Mar. 31, 2013
Entity Information [Line Items]  
REPORTABLE SEGMENTS
REPORTABLE SEGMENTS
GAAP guidance requires that segment disclosures present the measure(s) used by the chief operating decision maker to decide how to allocate resources and for purposes of assessing such segments’ performance. UDR’s chief operating decision maker is comprised of several members of its executive management team who use several generally accepted industry financial measures to assess the performance of the business for our reportable operating segments.
UDR owns and operates multifamily apartment communities that generate rental and other property related income through the leasing of apartment homes to a diverse base of tenants. The primary financial measures for UDR’s apartment communities are rental income and net operating income (“NOI”). Rental income represents gross market rent less adjustments for concessions, vacancy loss and bad debt. NOI is defined as rental income less direct property rental expenses. Rental expenses include real estate taxes, insurance, personnel, utilities, repairs and maintenance, administrative and marketing. Excluded from NOI is property management expense which is calculated as 2.75% of property revenue to cover the regional supervision and accounting costs related to consolidated property operations, and land rent. UDR’s chief operating decision maker utilizes NOI as the key measure of segment profit or loss.
UDR’s two reportable segments are same store communities and non-mature communities/other:

•
Same store communities represent those communities acquired, developed, and stabilized prior to January 1, 2012 and held as of March 31, 2013. A comparison of operating results from the prior year is meaningful as these communities were owned and had stabilized occupancy and operating expenses as of the beginning of the prior year, there is no plan to conduct substantial redevelopment activities, and the community is not held for disposition within the current year. A community is considered to have stabilized occupancy once it achieves 90% occupancy for at least three consecutive months.

•
Non-mature communities/other represent those communities that were acquired or developed in 2011 or 2012, sold properties, redevelopment properties, consolidated joint venture properties, properties managed by third parties, and the non-apartment components of mixed use properties.
Management evaluates the performance of each of our apartment communities on a same store community and non-mature community/other basis, as well as individually and geographically. This is consistent with the aggregation criteria under GAAP as each of our apartment communities generally has similar economic characteristics, facilities, services, and tenants. Therefore, the Company’s reportable segments have been aggregated by geography in a manner identical to that which is provided to the chief operating decision maker.
All revenues are from external customers and no single tenant or related group of tenants contributed 10% or more of UDR’s total revenues during the three months ended March 31, 2013 and 2012.
The following table details rental income and NOI from continuing and discontinued operations for UDR’s reportable segments for the three months ended March 31, 2013 and 2012, and reconciles NOI to net income/(loss) attributable to UDR, Inc. per the Consolidated Statements of Operations (dollars in thousands):
 
Three Months Ended March 31,
 
2013
 
2012
Reportable apartment home segment rental income
 
 
 
Same Store Communities
 
 
 
West Region
$
58,493

 
$
55,588

Mid-Atlantic Region
41,351

 
39,725

Northeast Region
14,099

 
13,144

Southeast Region
28,544

 
27,013

Southwest Region
11,426

 
10,581

Non-Mature Communities/Other
30,388

 
43,292

Total segment and consolidated rental income
$
184,301

 
$
189,343

Reportable apartment home segment NOI
 
 
 
Same Store Communities
 
 
 
West Region
$
41,315

 
$
38,736

Mid-Atlantic Region
28,762

 
27,565

Northeast Region
10,071

 
9,301

Southeast Region
18,705

 
17,594

Southwest Region
6,883

 
6,265

Non-Mature Communities/Other
19,580

 
28,653

Total segment and consolidated NOI
125,316

 
128,114

Reconciling items:
 
 
 
Joint venture management and other fees
2,923

 
2,989

Property management
(5,068
)
 
(5,207
)
Other operating expenses
(1,643
)
 
(1,383
)
Real estate depreciation and amortization
(83,442
)
 
(94,247
)
General and administrative
(9,476
)
 
(9,379
)
Hurricane-related recoveries/(charges), net
3,021

 
—

Other depreciation and amortization
(1,146
)
 
(918
)
Loss from unconsolidated entities
(2,802
)
 
(2,691
)
Interest expense
(30,981
)
 
(34,745
)
Interest and other income, net
1,016

 
694

Tax benefit of taxable REIT subsidiary, net
1,973

 
22,876

Net loss/(income) attributable to redeemable noncontrolling interests in OP
45

 
(3,420
)
Net income attributable to noncontrolling interests
(4
)
 
(52
)
Net gain on sale of depreciable property, net of tax
—

 
80,525

Net (loss)/income attributable to UDR, Inc.
$
(268
)
 
$
83,156

The following table details the assets of UDR’s reportable segments as of March 31, 2013 and December 31, 2012 (dollars in thousands):
 
March 31,
2013
 
December 31,
2012
Reportable apartment home segment assets:
 
 
 
Same Store Communities:
 
 
 
West Region
$
2,379,289

 
$
2,376,459

Mid-Atlantic Region
1,421,806

 
1,419,873

Northeast Region
725,235

 
723,437

Southeast Region
875,841

 
870,207

Southwest Region
413,583

 
413,085

Non-Mature Communities/Other
2,366,362

 
2,252,767

Total segment assets
8,182,116

 
8,055,828

Accumulated depreciation
(2,007,482
)
 
(1,924,682
)
Total segment assets — net book value
6,174,634

 
6,131,146

Reconciling items:
 
 
 
Cash and cash equivalents
7,121

 
12,115

Restricted cash
24,628

 
23,561

Deferred financing costs, net
23,654

 
24,990

Notes receivable, net
66,193

 
64,006

Investment in and advances to unconsolidated joint ventures, net
461,397

 
477,631

Other assets
133,154

 
125,654

Total consolidated assets
$
6,890,781

 
$
6,859,103


Capital expenditures related to our same store communities totaled $6.9 million and $9.9 million for the three months ended March 31, 2013 and 2012, respectively. Capital expenditures related to our non-mature communities/other totaled $346,000 and $2.4 million for the three months ended March 31, 2013 and 2012, respectively.
Markets included in the above geographic segments are as follows:
i.
West Region — Orange County, San Francisco, Seattle, Monterey Peninsula, Los Angeles, San Diego, Inland Empire, Sacramento, and Portland
ii.
Mid-Atlantic Region — Washington D.C., Richmond, Baltimore, Norfolk, and other Mid-Atlantic
iii.
Northeast Region — New York and Boston
iv.
Southeast Region — Tampa, Orlando, Nashville, and other Florida
v.
Southwest Region — Dallas and Austin
United Dominion Reality L.P. [Member]
  
Entity Information [Line Items]  
REPORTABLE SEGMENTS
REPORTABLE SEGMENTS
GAAP guidance requires that segment disclosures present the measure(s) used by the chief operating decision maker to decide how to allocate resources and for purposes of assessing such segments’ performance. The Operating Partnership has the same chief operating decision maker as that of its parent, the General Partner. The chief operating decision maker consists of several members of UDR’s executive management team who use several generally accepted industry financial measures to assess the performance of the business for our reportable operating segments.
The Operating Partnership owns and operates multifamily apartment communities throughout the United States that generate rental and other property related income through the leasing of apartment homes to a diverse base of tenants. The primary financial measures of the Operating Partnership’s apartment communities are rental income and net operating income (“NOI”), and are included in the chief operating decision maker’s assessment of UDR’s performance on a consolidated basis. Rental income represents gross market rent less adjustments for concessions, vacancy loss and bad debt. NOI is defined as total revenues less direct property operating expenses. Rental expenses include real estate taxes, insurance, personnel, utilities, repairs and maintenance, administrative and marketing. Excluded from NOI is property management expense which is calculated as 2.75% of property revenue to cover the regional supervision and accounting costs related to consolidated property operations, and land rent. The chief operating decision maker of the General Partner utilizes NOI as the key measure of segment profit or loss.
The Operating Partnership’s two reportable segments are same store communities and non-mature communities/other:

•
Same store communities represent those communities acquired, developed, and stabilized prior to January 1, 2012 and held as of March 31, 2013. A comparison of operating results from the prior year is meaningful as these communities were owned and had stabilized occupancy and operating expenses as of the beginning of the prior year, there is no plan to conduct substantial redevelopment activities, and the community is not held for disposition within the current year. A community is considered to have stabilized occupancy once it achieves 90% occupancy for at least three consecutive months.

•
Non-mature communities/other represent those communities that were acquired or developed in 2011 or 2012, sold properties, redevelopment properties, properties managed by third parties, and the non-apartment components of mixed use properties.
Management evaluates the performance of each of our apartment communities on a same store community and non-mature community/other basis, as well as individually and geographically. This is consistent with the aggregation criteria of Topic 280 as each of our apartment communities generally has similar economic characteristics, facilities, services, and tenants. Therefore, the Operating Partnership’s reportable segments have been aggregated by geography in a manner identical to that which is provided to the chief operating decision maker.
All revenues are from external customers and no single tenant or related group of tenants contributed 10% or more of the Operating Partnership’s total revenues during the three months ended March 31, 2013 and 2012.
The following table details rental income and NOI from continuing and discontinued operations for the Operating Partnership’s reportable segments for the three months ended March 31, 2013 and 2012, and reconciles NOI to net income/(loss) attributable to OP unitholders per the Consolidated Statements of Operations (dollars in thousands):
 
Three Months Ended March 31,
 
2013
 
2012
Reportable apartment home segment rental income
 
 
 
Same Store Communities
 
 
 
West Region
$
44,571

 
$
42,525

Mid-Atlantic Region
16,911

 
16,336

Northeast Region
8,906

 
8,374

Southeast Region
10,586

 
9,985

Southwest Region
5,143

 
4,784

Non-Mature Communities/Other
13,943

 
17,264

Total segment and consolidated rental income
$
100,060

 
$
99,268

Reportable apartment home segment NOI
 
 
 
Same Store Communities
 
 
 
West Region
$
31,701

 
$
29,818

Mid-Atlantic Region
11,533

 
11,172

Northeast Region
6,475

 
6,047

Southeast Region
7,005

 
6,577

Southwest Region
3,179

 
2,986

Non-Mature Communities/Other
10,230

 
12,938

Total segment and consolidated NOI
70,123

 
69,538

Reconciling items:
 
 
 
Property management
(2,752
)
 
(2,730
)
Other operating expenses
(1,386
)
 
(4,049
)
Real estate depreciation and amortization
(45,393
)
 
(51,677
)
General and administrative
(5,575
)
 
(4,920
)
Hurricane-related recoveries/(charges), net
2,019

 
—

Interest expense
(9,262
)
 
(12,970
)
Net loss on the sale of depreciable real estate
—

 
(84
)
Net income attributable to noncontrolling interests
(45
)
 
(34
)
Net income/(loss) attributable to OP unitholders
$
7,729

 
$
(6,926
)









The following table details the assets of the Operating Partnership’s reportable segments as of March 31, 2013 and December 31, 2012 (dollars in thousands):
 
March 31,
2013
 
December 31, 2012
Reportable apartment home segment assets
 
 
 
Same Store Communities
 
 
 
West Region
$
1,723,544

 
$
1,721,252

Mid-Atlantic Region
702,801

 
701,741

Northeast Region
434,657

 
434,138

Southeast Region
323,577

 
322,882

Southwest Region
185,654

 
185,501

Non-Mature Communities/Other
840,247

 
817,406

Total segment assets
4,210,480

 
4,182,920

Accumulated depreciation
(1,142,440
)
 
(1,097,133
)
Total segment assets - net book value
3,068,040

 
3,085,787

Reconciling items:
 
 
 
Cash and cash equivalents
2,951

 
2,804

Restricted cash
13,389

 
12,926

Deferred financing costs, net
5,745

 
6,072

Other assets
35,947

 
28,665

Total consolidated assets
$
3,126,072

 
$
3,136,254


Capital expenditures related to the Operating Partnership’s same store communities totaled $3.9 million and $6.1 million for the three months ended March 31, 2013 and 2012, respectively. Capital expenditures related to the Operating Partnership’s non-mature communities/other totaled $121,000 and $402,000 for the three months ended March 31, 2013 and 2012, respectively.
Markets included in the above geographic segments are as follows:
i.
West Region — Orange County, San Francisco, Monterey Peninsula, Los Angeles, Seattle, Sacramento, Inland Empire, Portland, and San Diego
ii.
Mid-Atlantic Region — Metropolitan D.C. and Baltimore
iii.
Northeast Region — New York and Boston
iv.
Southeast Region — Nashville, Tampa, and other Florida
v.
Southwest Region — Dallas