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Reportable Segments (UNITED DOMINION REALTY, L.P.)
 6 Months Ended
Jun. 30, 2015
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 April 1, 2014 for quarter-to-date comparison and January 1, 2014 for year-to-date comparison and held as of June 30, 2015. 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 six months ended June 30, 2015 and 2014.
The following table details rental income and NOI from continuing and discontinued operations for UDR’s reportable segments for the three and six months ended June 30, 2015 and 2014, and reconciles NOI to Net Income/(Loss) Attributable to UDR, Inc. in the Consolidated Statements of Operations (dollars in thousands):
 
Three Months Ended
 
Six Months Ended
 
June 30, (a)
 
June 30, (b)
 
2015
 
2014
 
2015
 
2014
Reportable apartment home segment rental income
 
 
 
 
 
 
 
Same-Store Communities
 
 
 
 
 
 
 
West Region
$
68,646

 
$
64,004

 
$
135,595

 
$
126,405

Mid-Atlantic Region
43,536

 
42,644

 
86,331

 
84,694

Southeast Region
26,540

 
25,063

 
52,505

 
49,774

Northeast Region
21,436

 
20,294

 
42,328

 
40,096

Southwest Region
14,363

 
13,623

 
28,470

 
27,090

Non-Mature Communities/Other
38,243

 
35,409

 
74,582

 
67,378

Total consolidated rental income
$
212,764

 
$
201,037

 
$
419,811

 
$
395,437

 
 
 
 
 
 
 
 
Reportable apartment home segment NOI
 
 
 
 
 
 
 
Same-Store Communities
 
 
 
 
 
 
 
West Region
$
51,400

 
$
46,496

 
$
100,999

 
$
91,287

Mid-Atlantic Region
30,302

 
29,863

 
59,590

 
58,699

Southeast Region
17,876

 
16,769

 
35,207

 
33,465

Northeast Region
16,269

 
15,459

 
31,835

 
30,004

Southwest Region
8,998

 
8,263

 
17,534

 
16,621

Non-Mature Communities/Other
25,587

 
23,542

 
48,842

 
42,440

Total consolidated NOI
150,432

 
140,392

 
294,007

 
272,516

Reconciling items:
 
 
 
 
 
 
 
Joint venture management and other fees
3,098

 
2,747

 
15,804

 
6,434

Property management
(5,851
)
 
(5,529
)
 
(11,545
)
 
(10,875
)
Other operating expenses
(1,769
)
 
(2,171
)
 
(3,535
)
 
(4,106
)
Real estate depreciation and amortization
(90,344
)
 
(88,876
)
 
(179,121
)
 
(177,409
)
General and administrative
(13,721
)
 
(12,530
)
 
(25,873
)
 
(24,524
)
Casualty-related recoveries/(charges), net
(843
)
 
—

 
(1,839
)
 
(500
)
Other depreciation and amortization
(1,700
)
 
(1,193
)
 
(3,323
)
 
(2,273
)
Income/(loss) from unconsolidated entities
(573
)
 
(428
)
 
58,586

 
(3,993
)
Interest expense
(29,673
)
 
(31,691
)
 
(58,473
)
 
(64,575
)
Interest income and other income/(expense), net
382

 
1,426

 
742

 
2,841

Tax benefit/(expense), net
1,404

 
2,230

 
1,829

 
5,559

Gain/(loss) on sale of real estate owned, net of tax
79,042

 
26,709

 
79,042

 
51,003

Net (income)/loss attributable to redeemable noncontrolling interests in the Operating Partnership
(3,029
)
 
(1,077
)
 
(5,617
)
 
(1,724
)
Net (income)/loss attributable to noncontrolling interests
—

 
(2
)
 
(7
)
 
(6
)
Net income/(loss) attributable to UDR, Inc.
$
86,855

 
$
30,007

 
$
160,677

 
$
48,368


(a)
Same-Store Community population consisted of 35,250 apartment homes.
(b)
Same-Store Community population consisted of 35,250 apartment homes.

The following table details the assets of UDR’s reportable segments as of June 30, 2015 and December 31, 2014 (dollars in thousands):
 
June 30,
2015
 
December 31,
2014
Reportable apartment home segment assets:
 
 
 
Same-Store Communities:
 
 
 
West Region
$
2,608,586

 
$
2,592,156

Mid-Atlantic Region
1,541,420

 
1,533,993

Southeast Region
738,595

 
733,068

Northeast Region
1,081,035

 
1,076,656

Southwest Region
443,526

 
440,721

Non-Mature Communities/Other
2,012,117

 
2,006,665

Total assets
8,425,279

 
8,383,259

Accumulated depreciation
(2,557,949
)
 
(2,434,772
)
Total assets — net book value
5,867,330

 
5,948,487

Reconciling items:
 
 
 
Cash and cash equivalents
2,990

 
15,224

Restricted cash
22,912

 
22,340

Deferred financing costs, net
19,930

 
22,686

Notes receivable, net
15,494

 
14,369

Investment in and advances to unconsolidated joint ventures, net
914,815

 
718,226

Other assets
96,259

 
105,202

Total consolidated assets
$
6,939,730

 
$
6,846,534


Capital expenditures related to our Same-Store Communities totaled $20.6 million and $12.8 million for the three months ended June 30, 2015 and 2014, respectively, and $33.8 million and $20.3 million for the six months ended June 30, 2015 and 2014, respectively. Capital expenditures related to our Non-Mature Communities/Other totaled $1.2 million and $2.5 million for the three months ended June 30, 2015 and 2014, respectively, and $3.8 million and $4.8 million for the six months ended June 30, 2015 and 2014.
Markets included in the above geographic segments are as follows:
i.
West Region — Orange County, San Francisco, Seattle, Los Angeles, Monterey Peninsula, Other Southern California, and Portland
ii.
Mid-Atlantic Region — Metropolitan D.C., Baltimore, Richmond, Norfolk, and Other Mid-Atlantic
iii.
Southeast Region — Tampa, Orlando, Nashville, and Other Florida
iv.
Northeast Region — New York and Boston
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 April 1, 2014 for quarter-to-date comparison and January 1, 2014 for year-to-date comparison and held as of June 30, 2015. 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 six months ended June 30, 2015 and 2014.
The following table details rental income and NOI from continuing and discontinued operations for the Operating Partnership’s reportable segments for the three and six months ended June 30, 2015 and 2014, and reconciles NOI to Net income/(loss) attributable to OP unitholders in the Consolidated Statements of Operations (dollars in thousands):
 
Three Months Ended
 
Six Months Ended
 
June 30, (a)
 
June 30, (b)
 
2015
 
2014
 
2015
 
2014
Reportable apartment home segment rental income
 
 
 
 
 
 
 
Same-Store Communities
 
 
 
 
 
 
 
West Region
$
48,175

 
$
44,544

 
$
95,082

 
$
87,916

Mid-Atlantic Region
17,613

 
17,364

 
34,862

 
34,610

Southeast Region
11,870

 
11,254

 
23,549

 
22,385

Northeast Region
15,497

 
14,658

 
30,570

 
28,925

Southwest Region
6,868

 
6,653

 
13,605

 
13,206

Non-Mature Communities/Other
13,135

 
10,369

 
25,585

 
20,170

Total consolidated rental income
$
113,158

 
$
104,842

 
$
223,253

 
$
207,212

Reportable apartment home segment NOI
 
 
 
 
 
 
 
Same-Store Communities
 
 
 
 
 
 
 
West Region
$
36,447

 
$
32,487

 
$
71,094

 
$
63,958

Mid-Atlantic Region
11,894

 
11,900

 
23,360

 
23,466

Southeast Region
7,938

 
7,503

 
15,648

 
14,959

Northeast Region
12,074

 
11,415

 
23,647

 
22,053

Southwest Region
4,361

 
4,168

 
8,574

 
8,386

Non-Mature Communities/Other
9,569

 
7,495

 
18,075

 
14,563

Total consolidated NOI
82,283

 
74,968

 
160,398

 
147,385

Reconciling items:
 
 
 
 
 
 
 
Property management
(3,112
)
 
(2,883
)
 
(6,139
)
 
(5,698
)
Other operating expenses
(1,496
)
 
(1,451
)
 
(2,986
)
 
(2,887
)
Real estate depreciation and amortization
(44,100
)
 
(44,697
)
 
(88,578
)
 
(88,968
)
General and administrative
(7,032
)
 
(7,459
)
 
(12,671
)
 
(14,429
)
Casualty-related recoveries/(charges), net
(280
)
 
—

 
(873
)
 
(500
)
Interest expense
(10,908
)
 
(10,159
)
 
(21,679
)
 
(20,173
)
Gain/(loss) on sale of real estate owned
32,375

 
16,285

 
56,998

 
40,687

Net (income)/loss attributable to noncontrolling interests
(347
)
 
(178
)
 
(741
)
 
(458
)
Net income/(loss) attributable to OP unitholders
$
47,383

 
$
24,426

 
$
83,729

 
$
54,959


(a)
Same-Store Community population consisted of 18,969 apartment homes.
(b)
Same-Store Community population consisted of 18,969 apartment homes
The following table details the assets of the Operating Partnership’s reportable segments as of June 30, 2015 and December 31, 2014 (dollars in thousands):
 
June 30,
2015
 
December 31, 2014
Reportable apartment home segment assets
 
 
 
Same-Store Communities
 
 
 
West Region
$
1,670,364

 
$
1,658,042

Mid-Atlantic Region
716,152

 
713,093

Southeast Region
335,662

 
333,428

Northeast Region
780,235

 
777,376

Southwest Region
230,330

 
228,996

Non-Mature Communities/Other
506,252

 
527,835

Total assets
4,238,995

 
4,238,770

Accumulated depreciation
(1,474,834
)
 
(1,403,303
)
Total assets - net book value
2,764,161

 
2,835,467

Reconciling items:
 
 
 
Cash and cash equivalents
164

 
502

Restricted cash
14,456

 
13,811

Deferred financing costs, net
3,707

 
4,475

Other assets
23,090

 
24,029

Total consolidated assets
$
2,805,578

 
$
2,878,284


Capital expenditures related to the Operating Partnership’s Same-Store Communities totaled $12.5 million and $7.3 million for the three months ended June 30, 2015 and 2014, respectively, and $20.3 million and $11.2 million for the six months ended June 30, 2015 and 2014, respectively. Capital expenditures related to the Operating Partnership’s Non-Mature Communities/Other totaled $0.7 million and $0.3 million for the three months ended June 30, 2015 and 2014, respectively, and $1.2 million and $0.6 million for the six months ended June 30, 2015 and 2014, respectively.
Markets included in the above geographic segments are as follows:
i.
West Region — Orange County, San Francisco, Seattle, Los Angeles, Monterey Peninsula, Other Southern California, and Portland
ii.
Mid-Atlantic Region — Metropolitan D.C. and Baltimore
iii.
Southeast Region — Tampa, Nashville, and Other Florida
iv.
Northeast Region — New York and Boston
v.
Southwest Region — Dallas