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Variable Interest Entities
 12 Months Ended
Dec. 31, 2024
Variable Interest Entities [Abstract]  
Variable Interest Entities Variable Interest Entities
Other Real Estate Partnerships
The Other Real Estate Partnerships are variable interest entities ("VIEs") of the Operating Partnership and the Operating Partnership is the primary beneficiary, thus causing the Other Real Estate Partnerships to be consolidated by the Operating Partnership. In addition, the Operating Partnership is a VIE of the Company and the Company is the primary beneficiary.
The following table summarizes the assets and liabilities of the Other Real Estate Partnerships included in our Consolidated Balance Sheets, net of intercompany amounts:
December 31, 2024December 31, 2023
ASSETS
Assets:
Net Investment in Real Estate$296,588 $302,869 
Operating Lease Right-of-Use Assets12,818 12,910 
Cash and Cash Equivalents2,463 2,221 
Deferred Rent Receivable16,060 15,601 
Prepaid Expenses and Other Assets, Net11,937 12,945 
Total Assets$339,866 $346,546 
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Accounts Payable, Accrued Expenses and Other Liabilities$8,625 $9,698 
Operating Lease Liabilities10,186 10,219 
Rents Received in Advance and Security Deposits8,412 8,368 
Partners' Capital
312,643 318,261 
Total Liabilities and Partners' Capital$339,866 $346,546 
Joint Venture
The Joint Venture was formed for the purpose of developing, leasing, operating and selling land located in the Phoenix, Arizona metropolitan area. We hold our Joint Venture interest through a consolidated partnership (the "Joint Venture Partnership") in which we hold an 88% interest and in which a third-party partner holds the remaining 12% interest. As we hold the power to direct the activities that most significantly impact the economic performance of the Joint Venture Partnership, we consolidate the Joint Venture Partnership and reflect our partner's share as Noncontrolling Interest (see Note 6). The Joint Venture Partnership holds a 49% interest in the unconsolidated Joint Venture, which we account for under the equity method of accounting. Excluding the minority interest holder's share, we own a 43% interest in the Joint Venture. The Joint Venture Partnership is held through a wholly-owned TRS of the Operating Partnership.
Under the operating agreement for the Joint Venture, we act as the managing member and are entitled to receive fees for providing management, leasing, development, construction supervision, disposition and asset management services. In addition, the Joint Venture's operating agreement provides us the ability to earn incentive fees based on the ultimate financial performance of the Joint Venture.
During the years ended December 31, 2024, 2023 and 2022, we earned fees of $3,105, $6,473 and $1,717, respectively, from the Joint Venture related to asset management, property management, leasing and development services we provided to the Joint Venture, of which we deferred recognition of $560, $1,314 and $395, respectively, due to our economic interest in the Joint Venture. During the years ended December 31, 2024, 2023 and 2022, we incurred fees of $1,529, $3,667 and $909, respectively, related to third-party development, property management and leasing services associated with the Joint Venture. At December 31, 2024 and 2023, we had a receivable from the Joint Venture of $364 and $138, respectively.
Net income of the Joint Venture for the years ended December 31, 2024, 2023 and 2022 was $6,223, $46,664 and $171,511, respectively. Net income during the year ended December 31, 2024, included gain on sale of real estate of $2,545 representing deferred gains from land sales in 2023 and 2022, which were recognized under the percentage-of-completion method as the Joint Venture completed required infrastructure work for the purchasers. Our economic share of the 2024 gain on sale was $1,247. Net income for 2023 included gain on sale of real estate of $40,616 related to the sale of approximately 31 acres of land, which our economic share of the gain on sale was $19,902. Net income for 2022 included gain on sale of real estate of $171,671 related to the sale of approximately 391 acres of land, which our economic share of the gain on sale was $84,119.
For the years ended December 31, 2024, 2023 and 2022, we earned incentive fees of $1,245, $9,369 and $31,308, respectively, from the Joint Venture, which are reflected in the Equity In Income of Joint Venture line item on the Consolidated Statements of Operations.
During the year ended December 31, 2024, the Joint Venture substantially completed development of three buildings totaling an aggregate 1.8 million square feet of GLA (the "Project"). During the year ended December 31, 2022, in connection with the Project, the Joint Venture entered into a construction loan with a capacity of $149,514 with a third-party lender (the "Joint Venture Loan"). At December 31, 2024 and 2023, the balance of the Joint Venture Loan is $131,111 and $95,711, respectively, excluding $269 and $730, respectively, of unamortized debt issuance costs. With respect to the Joint Venture Loan, we provided a completion guarantee to the lender and our third-party joint venture partner that requires the Company to timely complete construction of the Project. Total estimated investment for the Project is approximately $229,363 and the Joint Venture is using a third-party general contractor to develop the buildings pursuant to a guaranteed maximum price contract. We also provided a guarantee to the lender related to typical non-recourse exceptions and an environmental indemnity. It is not possible to estimate the amount of additional costs, if any, that we may incur in connection with our completion guarantees to the third-party lender and/or our joint venture partner as well as the non-recourse exception and environmental indemnity guarantees; however, we do not expect that we will be required to make any significant payments in satisfaction of these guarantees.
As part of our assessment of the appropriate accounting treatment for the Joint Venture, we reviewed the operating agreements of each Joint Venture in order to determine our rights and the rights of our joint venture partners, including whether those rights are protective or participating. Each operating agreement contains certain protective rights, such as the requirement of both members' approval to sell, finance or refinance the property and to pay capital expenditures and operating expenditures outside of the approved budget. Also, we and our Joint Venture partners jointly (i) approve the annual budget, (ii) approve certain expenditures, (iii) review and approve the Joint Venture's tax return before filing and (iv) approve each lease at a developed property. We consider the latter rights substantive participation rights that result in shared, joint power over the activities that most significantly impact the performance of each Joint Venture. As such, we concluded to account for our investments in each Joint Venture under the equity method of accounting.