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Transactions with Norfolk Southern Railway Company | 12 Months Ended
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Dec. 31, 2022
Business Combination and Asset Acquisition [Abstract] |
TRANSACTIONS WITH NORFOLK SOUTHERN RAILWAY COMPANY | TRANSACTIONS WITH NORFOLK SOUTHERN RAILWAY COMPANY On March 1, 2019, the Company entered into a series of agreements and executed related transactions with Norfolk Southern Railway Company (“NS”) as follows: •Sold land to NS for $52.5 million. •Executed a Development Agreement with NS whereby the Company received fees totaling $5.0 million in consideration for development services for NS’s corporate headquarters that has been constructed on the land sold to NS. •Executed a Consulting Agreement with NS whereby the Company received fees totaling $32.0 million in consideration for consulting services for NS’s corporate headquarters. The Development Agreement and Consulting Agreement are collectively referred to below as the “Fee Agreements.” •Purchased a building from NS (“Promenade Central”) for $82.0 million subject to a three-year market rate lease with NS that covered the entire building and expired December 31, 2021. The Company sold the land to NS for $5.0 million above its carrying amount, which included $37.0 million of land purchased in 2018, $6.5 million of land purchased in 2019, and $4.0 million of site preparation work. The Company purchased Promenade Central from NS for an amount it determined to be $10.3 million below the building’s fair value. The Company determined that all contracts and transactions associated with NS should be combined for accounting purposes, and the amounts exchanged under the combined contracts should be allocated to the various components of the overall transaction at fair value or market value as discussed below. The Company determined that the purchase of Promenade Central should be recorded at fair value of $92.3 million. The Company determined that the lease with NS at the Promenade Central building was at market value under ASC 842. The land sale was accounted for under ASC 610-20, and no gain or loss was recorded on the derecognition of this non-financial asset as the fair value was determined to equal the carrying amount. Consideration related to various services provided to NS, and accounted for under ASC 606, was determined to be $52.3 million and represents the negotiated market value for the services agreed to by the Company and NS in the contracts. This amount included non-cash consideration of the $10.3 million discount on the purchase of Promenade Central as well as cash consideration of $5.0 million from the land sale contract (difference between fair value and contract amount), $5.0 million from the Development Agreement, and $32.0 million from the Consulting Agreement. Since all of the agreements and contracts above were executed for the purpose of delivering and constructing a corporate headquarters for NS and all of the services and deliverables are highly interdependent, the Company determined that the services represent a single performance obligation under ASC 606. The Company determined that control of the services to be provided is being transferred over time and, thus, the Company recognized the $52.3 million contract price in revenue as it satisfied the performance obligation. The Company determined that the inputs method of measuring progress of satisfying the performance obligation was the most appropriate method of recognizing revenue for the services component. Therefore, the Company began recognizing revenue on March 1, 2019, based upon the time spent by the Company’s employees in providing these services as compared to the total estimated time required to satisfy the performance obligation. During the years ended December 31, 2022, 2021, and 2020, the Company recognized $3.2 million, $11.9 million, and $14.9 million, respectively, in fee income in the consolidated statements of operations related to the services provided to NS. As of December 31, 2021, the Company had deferred income related to NS included in the consolidated balance sheet of $1.8 million. As of December 31, 2022, the Company had no deferred income related to NS included in the consolidated balance sheet, and all revenue related to this performance obligation had been recognized.

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI https://asc.fasb.org/subtopic&trid=2122178 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI https://asc.fasb.org/topic&trid=2303972 + Details
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