Joint Ventures (Tables)

12 Months Ended

Dec. 31, 2015

Equity Method Investments and Joint Ventures [Abstract]

Summary of investments in unconsolidated joint ventures

The Company recognizes earnings or losses from our investments in unconsolidated joint ventures and partnerships consisting of our proportionate share of the net earnings or losses of the joint ventures and partnerships. In addition, we may earn fees for providing management services to the unconsolidated joint ventures and partnerships.

The following table summarizes the Company’s investment in and advances to unconsolidated joint ventures and partnerships, net, which are accounted for under the equity method of accounting as of December 31, 2015 and 2014 (dollars in thousands):



Joint Venture	Location of Properties	Number of Properties	Number of Apartment Homes	Investment at					UDR’s Ownership Interest
		December 31, 2015	December 31, 2015	December 31, 2015		December 31, 2014			December 31, 2015					December 31, 2014
Operating and development:
UDR/MetLife I	Various	4 land parcels	—	$	15,894	$	13,306		17.2				%	15.7			%
UDR/MetLife II (a)	Various	21 operating communities	4,642	425,230		431,277			50.0				%	50.0			%
Other UDR/MetLife Development Joint Ventures		1 operating community;
		4 development communities (b);
	Various	1 land parcels	1,437	171,659		134,939			50.6				%	50.6			%
UDR/MetLife Vitruvian Park^®	Addison, TX	3 operating communities;
		6 land parcels	1,130	73,469		80,302			50.0				%	50.0			%
UDR/KFH	Washington, D.C.	3 operating communities	660	17,211		21,596			30.0				%	30.0			%
Texas (c)	Texas	—	—	—		(25,901		)	—				%	20.0			%
Investment in and advances to unconsolidated joint ventures, net, before participating loan investment and preferred equity investment				703,463		655,519

				Investment at					Income from investments for the years ending December 31,
	Location	Rate	Years To Maturity	December 31, 2015		December 31, 2014			2015		2014				2013
Participating loan investment:
Steele Creek	Denver, CO	6.5%	1.6	90,747		62,707			$	5,453	$	2,350			$	156

Preferred equity investment:
West Coast Development Joint Venture (d)	Various	6.5%	—	144,696		—			$	3,692	$	—			$	—
Total investment in and advances to unconsolidated joint ventures, net				$	938,906	$	718,226


(a)	In September 2015, the 717 Olympic community, which is held by the UDR/MetLife II joint venture, experienced extensive water damage due a ruptured water pipe. For the year ended December 31, 2015, the Company recorded losses of $2.5 million, its proportionate share of the total losses incurred.

(b) The number of apartment homes for the communities under development presented in the table above is based on the projected number of total homes. As of December 31, 2015, no apartment homes had been completed in Other UDR/MetLife Development Joint Ventures.


(c)	In January 2015, the eight communities held by the Texas joint venture were sold, generating net proceeds to UDR of $44.2 million. The Company recorded promote and fee income of $10.0 million and a gain of $59.4 million (including $24.2 million of previously deferred gains) in connection with the sale.

(d)

In May 2015, the Company entered into a joint venture agreement with real estate private equity firm, The Wolff Company (“Wolff”), and agreed to pay $136.3 million for a 48 percent ownership interest in a portfolio of five communities that are currently under construction (the "West Coast Development Joint Venture"). The communities are located in three of the Company’s core, coastal markets: Metro Seattle, Los Angeles and Orange County, CA. UDR earns a 6.5 percent preferred return on its investment through each individual community’s date of stabilization, defined as when a community reaches 80 percent occupancy for ninety consecutive days, while Wolff is allocated all operating income and expense during the pre-stabilization period. Upon stabilization, income and expense will be shared based on each partner’s ownership percentage. The Company will serve as property manager and be paid a management fee during the lease-up phase and subsequent operation of each of the communities. Wolff is the general partner of the joint venture and the developer of the communities.

The Company has a fixed price option to acquire Wolff’s remaining interest in each community beginning one year after completion. If the options are exercised for all five communities, the Company’s total price will be $597.4 million. In the event the Company does not exercise its options to purchase at least two communities, Wolff will be entitled to earn a contingent disposition fee equal to 6.5 percent return on its implied equity in the communities not acquired. Wolff is providing certain guaranties and there are construction loans on all five communities. Once completed, the five communities will contain 1,533 homes.

The Company has concluded it does not control the joint venture and accounts for it under the equity method of accounting. The Company's recorded equity investment in the West Coast Development Joint Venture at December 31, 2015 of $144.7 million is inclusive of outside basis costs and our accrued but unpaid preferred return. During the year ended December 31, 2015, the Company earned a preferred return of $5.2 million, offset by its share of the West Coast Development Joint Venture transaction expenses of $1.5 million.

Financial information relating to unconsolidated joint ventures operations

Combined summary financial information relating to all of the unconsolidated joint ventures and partnerships operations (not just our proportionate share), is presented below for the years ended December 31, 2015, 2014, and 2013 (dollars in thousands):



As of and For the Year Ended December 31, 2015	UDR/MetLife I			UDR/MetLife II			Other UDR/MetLife Development Joint Ventures			UDR/MetLife Vitruvian Park^®			UDR/KFH			Texas		Total
Condensed Statements of Operations:
Total revenues	$	541		$	170,062		$	7,634		$	22,139		$	19,338		$	—	$	219,714
Property operating expenses	(906		)	(63,516		)	(3,826		)	(11,519		)	(7,733		)	—		(87,500		)
Real estate depreciation and amortization	(818		)	(46,616		)	(6,897		)	(6,639		)	(14,522		)	—		(75,492		)
Operating income/(loss)	(1,183		)	59,930			(3,089		)	3,981			(2,917		)	—		56,722
Interest expense	—			(52,037		)	(2,566		)	(4,848		)	(5,539		)	—		(64,990		)
Income/(loss) from discontinued operations	(20		)	—			—			—			—			184,138		184,118
Net income/(loss)	$	(1,203	)	$	7,893		$	(5,655	)	$	(867	)	$	(8,456	)	$	184,138	$	175,850
UDR recorded income (loss) from unconsolidated entities	$	(513	)	$	3,578		$	6,088		$	(3,711	)	$	(2,537	)	$	59,424	$	62,329

Condensed Balance Sheets:
Total real estate, net	$	92,915		$	1,942,630		$	604,611		$	273,897		$	221,704		$	—	$	3,135,757
Cash and cash equivalents	1,202			20,767			5,996			7,185			1,320			10		36,480
Other assets	174			24,914			1,921			2,317			565			—		29,891
Total assets	94,291			1,988,311			612,528			283,399			223,589			10		3,202,128
Amount due to/(from) UDR	2			—			5,929			908			427			—		7,266
Third party debt	—			1,122,662			201,114			126,388			164,299			—		1,614,463
Accounts payable and accrued liabilities	395			24,244			62,267			7,137			1,480			—		95,523
Total liabilities	397			1,146,906			269,310			134,433			166,206			—		1,717,252
Total equity	$	93,894		$	841,405		$	343,218		$	148,966		$	57,383		$	10	$	1,484,876
UDR’s investment in and advances to unconsolidated joint ventures	$	15,894		$	425,230		$	407,102		$	73,469		$	17,211		$	—	$	938,906



As of and For the Year Ended December 31, 2014	UDR/MetLife I			UDR/MetLife II			Other UDR/MetLife Development Joint Ventures			UDR/MetLife Vitruvian Park^®			UDR/KFH			Texas			Total
Condensed Statements of Operations:
Total revenues	$	727		$	152,047		$	1,579		$	19,376		$	19,724		$	—		$	193,453
Property operating expenses	618			52,150			1,122			10,711			7,498			—			72,099
Real estate depreciation and amortization	2,130			41,504			3,959			7,380			14,426			—			69,399
Operating income/(loss)	(2,021		)	58,393			(3,502		)	1,285			(2,200		)	—			51,955
Interest expense	—			(48,493		)	(94		)	(4,131		)	(5,873		)	—			(58,591		)
Income/(loss) from discontinued operations	(31,802		)	—			—			—			—			(4,229		)	(36,031		)
Net income/(loss)	$	(33,823	)	$	9,900		$	(3,596	)	$	(2,846	)	$	(8,073	)	$	(4,229	)	$	(42,667	)
UDR recorded income/(loss) from unconsolidated entities	$	(2,955	)	$	2,814		$	576		$	(4,068	)	$	(2,601	)	$	(772	)	$	(7,006	)

Condensed Balance Sheets:
Total real estate, net	$	89,482		$	1,986,237		$	351,861		$	278,600		$	235,623		$	—		$	2,941,803
Assets held for sale	1,978			—			—			—			—			214,218			216,196
Cash and cash equivalents	1,983			15,245			6,239			6,570			2,507			—			32,544
Other assets (a)	(146		)	12,938			1,101			3,248			708			—			17,849
Total assets (a)	93,297			2,014,420			359,201			288,418			238,838			214,218			3,208,392
Amount due to/(from) UDR	107			(444		)	843			1,960			531			—			2,997
Third party debt (a)	—			1,140,458			65,408			122,964			164,789			—			1,493,619
Liabilities held for sale	5,110			—			—			—			—			224,596			229,706
Accounts payable and accrued liabilities (a)	749			17,573			17,851			6,766			1,396			—			44,335
Total liabilities (a)	5,966			1,157,587			84,102			131,690			166,716			224,596			1,770,657
Total equity	$	87,331		$	856,833		$	275,099		$	156,728		$	72,122		$	(10,378	)	$	1,437,735
UDR’s investment in and advances to unconsolidated joint ventures	$	13,306		$	431,277		$	197,646		$	80,302		$	21,596		$	(25,901	)	$	718,226

(a) The Company elected to early adopt FASB ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs, and ASU 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements, during the fourth quarter of 2015. See Note 2, Significant Accounting Policies, for a complete description of the ASUs and their impact.

Under the ASUs, deferred financing costs related to debt are treated as offsets to the debt instead of assets. As a result of adopting the ASUs, the following retrospective changes were made to the above table:



For the Year Ended December 31, 2014	UDR/MetLife I			UDR/MetLife II			Other UDR/MetLife Development Joint Ventures			UDR/MetLife Vitruvian Park^®			UDR/KFH			Texas		Total
Other assets - as previously reported	$	(146	)	$	19,589		$	4,203		$	3,933		$	1,128		$	—	$	28,707
Deferred financing costs	—			(6,651		)	(3,102		)	(685		)	(420		)	—		(10,858		)
Other assets - as presented above	$	(146	)	$	12,938		$	1,101		$	3,248		$	708		$	—	$	17,849

Total assets - as previously reported	$	93,297		$	2,021,071		$	362,303		$	289,103		$	239,258		$	214,218	$	3,219,250
Deferred financing costs	—			(6,651		)	(3,102		)	(685		)	(420		)	—		(10,858		)
Total assets - as presented above	$	93,297		$	2,014,420		$	359,201		$	288,418		$	238,838		$	214,218	$	3,208,392

Third party debt - as previously reported	$	—		$	1,147,109		$	68,510		$	123,649		$	165,209		$	—	$	1,504,477
Deferred financing costs	—			(6,651		)	(3,102		)	(685		)	(420		)	—		(10,858		)
Third party debt - as presented above	$	—		$	1,140,458		$	65,408		$	122,964		$	164,789		$	—	$	1,493,619

Accounts payable and accrued liabilities - as previously reported	$	749		$	17,573		$	17,851		$	6,766		$	1,396		$	—	$	44,335
Deferred financing costs	—			—			—			—			—			—		—
Accounts payable and accrued liabilities - as presented above	$	749		$	17,573		$	17,851		$	6,766		$	1,396		$	—	$	44,335

Total liabilities - as previously reported	$	5,966		$	1,164,238		$	87,204		$	132,375		$	167,136		$	224,596	$	1,781,515
Deferred financing costs	—			(6,651		)	(3,102		)	(685		)	(420		)	—		(10,858		)
Total liabilities - as presented above	$	5,966		$	1,157,587		$	84,102		$	131,690		$	166,716		$	224,596	$	1,770,657



For the Year Ended December 31, 2013	UDR/MetLife I			UDR/MetLife II			Other UDR/MetLife Development Joint Ventures			UDR/MetLife Vitruvian Park^®			UDR/KFH			Texas			Total
Condensed Statements of Operations:
Total revenues	$	691		$	109,926		$	5,324		$	7,680		$	19,221		$	—		$	142,842
Property operating expenses	621			33,809			3,292			4,633			7,035			—			49,390
Real estate depreciation and amortization	115			30,122			3,564			3,830			14,199			—			51,830
Operating income/(loss)	(45		)	45,995			(1,532		)	(783		)	(2,013		)	—			41,622
Interest expense	—			(37,055		)	(913		)	(1,886		)	(5,872		)	—			(45,726		)
Other income/(expense)	—			1			—			—			—			—			1
Income/(loss) from discontinued operations	(22,388		)	—			—			—			—			(9,584		)	(31,972		)
Net income/(loss)	$	(22,433	)	$	8,941		$	(2,445	)	$	(2,669	)	$	(7,885	)	$	(9,584	)	$	(36,075	)
UDR recorded income/(loss) from unconsolidated entities	$	(4,675	)	$	4,471		$	6,224		$	(2,851	)	$	(2,366	)	$	(1,218	)	$	(415	)