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Reportable Segments (UNITED DOMINION REALTY, L.P.)
 9 Months Ended
Sep. 30, 2014
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 July 1, 2013 for quarter-to-date comparison and January 1, 2013 for year-to-date comparison and held as of September 30, 2014. 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 period, 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 do not meet the criteria to be included in Same-Store Communities, including, but not limited to, recently acquired, developed and redeveloped properties, 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 and nine months ended September 30, 2014 and 2013.
The following table details rental income and NOI from continuing and discontinued operations for UDR’s reportable segments for the three and nine months ended September 30, 2014 and 2013, and reconciles NOI to Net Income/(Loss) Attributable to UDR, Inc. in the Consolidated Statements of Operations (dollars in thousands):
 
Three Months Ended September 30, (a)
 
Nine Months Ended September 30, (b)
 
2014
 
2013
 
2014
 
2013
Reportable apartment home segment rental income
 
 
 
 
 
 
 
Same-Store Communities
 
 
 
 
 
 
 
West Region
$
68,275

 
$
64,195

 
$
189,075

 
$
177,884

Mid-Atlantic Region
40,479

 
40,164

 
121,356

 
119,937

Southeast Region
27,210

 
25,851

 
80,578

 
76,763

Northeast Region
20,721

 
19,806

 
45,331

 
43,441

Southwest Region
13,859

 
13,293

 
40,949

 
39,012

Non-Mature Communities/Other
33,064

 
27,070

 
121,756

 
106,256

Total consolidated rental income
$
203,608

 
$
190,379

 
$
599,045

 
$
563,293

 
 
 
 
 
 
 
 
Reportable apartment home segment NOI
 
 
 
 
 
 
 
Same-Store Communities
 
 
 
 
 
 
 
West Region
$
49,110

 
$
45,699

 
$
136,587

 
$
126,860

Mid-Atlantic Region
27,622

 
27,629

 
83,581

 
83,287

Southeast Region
17,480

 
16,560

 
53,329

 
49,866

Northeast Region
15,571

 
14,678

 
33,361

 
31,409

Southwest Region
8,509

 
7,983

 
25,130

 
23,751

Non-Mature Communities/Other
21,522

 
16,094

 
80,342

 
67,439

Total consolidated NOI
139,814

 
128,643

 
412,330

 
382,612

Reconciling items:
 
 
 
 
 
 
 
Joint venture management and other fees
3,165

 
3,207

 
9,599

 
9,347

Property management
(5,599
)
 
(5,236
)
 
(16,474
)
 
(15,491
)
Other operating expenses
(2,012
)
 
(1,787
)
 
(6,118
)
 
(5,237
)
Real estate depreciation and amortization
(89,339
)
 
(84,266
)
 
(266,748
)
 
(252,839
)
General and administrative
(11,554
)
 
(11,364
)
 
(36,078
)
 
(30,706
)
Casualty-related recoveries/(charges), net
—

 
6,460

 
(500
)
 
12,253

Other depreciation and amortization
(1,385
)
 
(1,176
)
 
(3,658
)
 
(3,460
)
Income/(loss) from unconsolidated entities
(939
)
 
(3,794
)
 
(4,932
)
 
(6,081
)
Interest expense
(33,087
)
 
(30,939
)
 
(97,662
)
 
(92,723
)
Interest and other income/(expense), net
9,061

 
829

 
11,902

 
3,291

Tax benefit/(expense), net
2,490

 
2,658

 
8,049

 
7,314

Gain/(loss) on sale of real estate owned, net of tax
31,377

 
—

 
82,380

 
—

Net (income)/loss attributable to redeemable noncontrolling interests in the Operating Partnership
(1,447
)
 
(84
)
 
(3,171
)
 
(198
)
Net (income)/loss attributable to noncontrolling interests
4

 
37

 
(2
)
 
30

Net income/(loss) attributable to UDR, Inc.
$
40,549

 
$
3,188

 
$
88,917

 
$
8,112


(a)
Same-Store Community population consisted of 36,268 apartment homes.
(b)
Same-Store Community population consisted of 35,177 apartment homes.

The following table details the assets of UDR’s reportable segments as of September 30, 2014 and December 31, 2013 (dollars in thousands):
 
September 30,
2014
 
December 31,
2013
Reportable apartment home segment assets:
 
 
 
Same-Store Communities:
 
 
 
West Region
$
2,591,838

 
$
2,412,091

Mid-Atlantic Region
1,404,730

 
1,395,772

Southeast Region
783,641

 
785,134

Northeast Region
1,073,905

 
1,066,260

Southwest Region
438,982

 
434,875

Non-Mature Communities/Other
2,135,195

 
2,113,845

Total assets
8,428,291

 
8,207,977

Accumulated depreciation
(2,379,033
)
 
(2,208,794
)
Total assets — net book value
6,049,258

 
5,999,183

Reconciling items:
 
 
 
Cash and cash equivalents
14,605

 
30,249

Restricted cash
23,969

 
22,796

Deferred financing costs, net
24,344

 
26,924

Notes receivable, net
18,318

 
83,033

Investment in and advances to unconsolidated joint ventures, net
650,441

 
507,655

Other assets
117,153

 
137,882

Total consolidated assets
$
6,898,088

 
$
6,807,722


Capital expenditures related to our Same-Store Communities totaled $15.1 million and $36.5 million for the three and nine months ended September 30, 2014, respectively, and $14.5 million and $34.6 million for the three and nine months ended September 30, 2013, respectively. Capital expenditures related to our Non-Mature Communities/Other totaled $1.3 million and $5.0 million for the three and nine months ended September 30, 2014, respectively, and $1.6 million and $4.8 million for the three and nine months ended September 30, 2013, respectively.
Markets included in the above geographic segments are as follows:
i.
West Region — San Francisco, Orange County, Seattle, Monterey Peninsula, Los Angeles, Other Southern California, and Portland
ii.
Mid-Atlantic Region — Metropolitan D.C., Baltimore, Richmond, 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 the Operating Partnership’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 July 1, 2013 for quarter-to-date comparison and January 1, 2013 for year-to-date comparison and held as of September 30, 2014. 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 period, 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 do not meet the criteria to be included in Same-Store Communities, including, but not limited to, recently acquired, developed and redeveloped properties, and the non-apartment components of mixed use properties.
Management of the General Partner evaluates the performance of each of the Operating Partnership’s 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 the 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 and nine months ended September 30, 2014 and 2013.
The following table details rental income and NOI from continuing and discontinued operations for the Operating Partnership’s reportable segments for the three and nine months ended September 30, 2014 and 2013, and reconciles NOI to Net income/(loss) attributable to OP unitholders in the Consolidated Statements of Operations (dollars in thousands):
 
Three Months Ended September 30, (a)
 
Nine Months Ended September 30, (b)
 
2014
 
2013
 
2014
 
2013
Reportable apartment home segment rental income
 
 
 
 
 
 
 
Same-Store Communities
 
 
 
 
 
 
 
West Region
$
49,279

 
$
46,246

 
$
144,252

 
$
135,418

Mid-Atlantic Region
17,169

 
17,105

 
51,779

 
51,095

Southeast Region
11,368

 
10,841

 
33,753

 
32,177

Northeast Region
14,968

 
14,331

 
28,410

 
27,414

Southwest Region
6,667

 
6,508

 
19,873

 
19,098

Non-Mature Communities/Other
7,993

 
8,966

 
36,589

 
41,564

Total consolidated rental income
$
107,444

 
$
103,997

 
$
314,656

 
$
306,766

Reportable apartment home segment NOI
 
 
 
 
 
 
 
Same-Store Communities
 
 
 
 
 
 
 
West Region
$
35,801

 
$
33,307

 
$
105,375

 
$
97,533

Mid-Atlantic Region
11,422

 
11,483

 
34,888

 
34,689

Southeast Region
7,327

 
6,957

 
22,286

 
20,898

Northeast Region
11,609

 
10,789

 
21,448

 
20,083

Southwest Region
4,192

 
4,040

 
12,578

 
11,987

Non-Mature Communities/Other
5,402

 
5,417

 
26,563

 
29,383

Total consolidated NOI
75,753

 
71,993

 
223,138

 
214,573

Reconciling items:
 
 
 
 
 
 
 
Property management
(2,955
)
 
(2,860
)
 
(8,653
)
 
(8,436
)
Other operating expenses
(1,484
)
 
(1,405
)
 
(4,371
)
 
(4,215
)
Real estate depreciation and amortization
(45,043
)
 
(44,857
)
 
(134,011
)
 
(135,552
)
General and administrative
(6,939
)
 
(6,855
)
 
(21,368
)
 
(18,324
)
Casualty-related recoveries/(charges), net
—

 
3,807

 
(500
)
 
8,083

Interest expense
(10,457
)
 
(8,773
)
 
(30,629
)
 
(27,085
)
Gain/(loss) on sale of real estate owned
—

 
—

 
40,687

 
—

Net (income)/loss attributable to noncontrolling interests
(238
)
 
(39
)
 
(697
)
 
(151
)
Net income/(loss) attributable to OP unitholders
$
8,637

 
$
11,011

 
$
63,596

 
$
28,893


(a)
Same-store consists of 19,518 apartment homes.
(b)
Same-store consists of 19,010 apartment homes.


The following table details the assets of the Operating Partnership’s reportable segments as of September 30, 2014 and December 31, 2013 (dollars in thousands):
 
September 30,
2014
 
December 31, 2013
Reportable apartment home segment assets
 
 
 
Same-Store Communities
 
 
 
West Region
$
1,742,559

 
$
1,733,144

Mid-Atlantic Region
710,277

 
706,447

Southeast Region
331,727

 
328,150

Northeast Region
776,310

 
770,937

Southwest Region
227,886

 
226,252

Non-Mature Communities/Other
430,464

 
423,550

Total assets
4,219,223

 
4,188,480

Accumulated depreciation
(1,358,123
)
 
(1,241,574
)
Total assets - net book value
2,861,100

 
2,946,906

Reconciling items:
 
 
 
Cash and cash equivalents
1,484

 
1,897

Restricted cash
13,989

 
13,526

Deferred financing costs, net
4,783

 
5,848

Other assets
25,070

 
25,064

Total consolidated assets
$
2,906,426

 
$
2,993,241


Capital expenditures related to the Operating Partnership’s Same-Store Communities totaled $8.6 million and $20.0 million for the three and nine months ended September 30, 2014, respectively, and $6.9 million and $18.5 million for the three and nine months ended September 30, 2013, respectively. Capital expenditures related to the Operating Partnership’s Non-Mature Communities/Other totaled $137,000 and $555,000 for the three and nine months ended September 30, 2014, respectively, and $436,000 and $1.5 million for the three and nine months ended September 30, 2013, respectively.
Markets included in the above geographic segments are as follows:
i.
West Region — San Francisco, Orange County, Seattle, Monterey Peninsula, Los Angeles, Other Southern California, and Portland
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