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Information by Business Segment | 9 Months Ended
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Sep. 30, 2016
Segment Reporting [Abstract] |
Information by Business Segment | Information by Business Segment We have the following reportable segments: Defense/IT Locations; Regional Office; our operating wholesale data center; and other. We also report on Defense/IT Locations sub-segments, which include the following: Fort George G. Meade and the Baltimore/Washington Corridor (referred to herein as “Fort Meade/BW Corridor”); Northern Virginia Defense/IT Locations; Lackland Air Force Base (in San Antonio); locations serving the U.S. Navy (“Navy Support Locations”), which included properties proximate to the Washington Navy Yard, the Naval Air Station Patuxent River in Maryland and the Naval Surface Warfare Center Dahlgren Division in Virginia; Redstone Arsenal (in Huntsville); and data center shells (properties leased to tenants to be operated as data centers in which the tenants generally fund the costs for the power, fiber connectivity and data center infrastructure). Effective in the quarter ended September 30, 2016, we changed our segment reporting measures to include certain amounts discussed below pertaining to investments in unconsolidated real estate joint ventures (“UJVs”); this change did not affect prior periods reported herein as we did not own any investments in UJVs during such periods prior to July 21, 2016 (see Note 5). We measure the performance of our segments through the measure we define as net operating income from real estate operations (“NOI from real estate operations”), which includes: real estate revenues and property operating expenses from continuing and discontinued operations; and the net of revenues and property operating expenses of real estate operations owned through UJVs that is allocable to COPT’s ownership interest (“UJV NOI allocable to COPT”). Amounts reported for segment assets represent long-lived assets associated with consolidated operating properties (including the carrying value of properties, intangible assets, deferred leasing costs, deferred rents receivable and lease incentives) and the carrying value of investments in UJVs owning operating properties. Amounts reported as additions to long-lived assets represent additions to existing consolidated operating properties, excluding transfers from non-operating properties, which we report separately. The table below reports segment financial information for our reportable segments (in thousands).
| Operating Office Property Segments |  |  |  |  |  |
| Defense/Information Technology Locations |  |  |  |  |  |  |  |
| Fort Meade/BW Corridor |  | Northern Virginia Defense/IT |  | Lackland Air Force Base |  | Navy Support Locations |  | Redstone Arsenal |  | Data Center Shells |  | Total Defense/IT Locations |  | Regional Office |  | Operating Wholesale Data Center |  | Other |  | Total
Three Months Ended September 30, 2016 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues from real estate operations | $ | 61,460 |  |  | $ | 12,231 |  |  | $ | 12,532 |  |  | $ | 7,232 |  |  | $ | 3,189 |  |  | $ | 5,175 |  |  | $ | 101,819 |  |  | $ | 20,499 |  |  | $ | 6,809 |  |  | $ | 1,827 |  |  | $ | 130,954 |
Property operating expenses | 20,598 |  |  | 4,462 |  |  | 7,599 |  |  | 3,374 |  |  | 1,112 |  |  | 528 |  |  | 37,673 |  |  | 8,155 |  |  | 3,317 |  |  | 807 |  |  | 49,952 |
UJV NOI allocable to COPT | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1,008 |  |  | 1,008 |  |  | — |  |  | — |  |  | — |  |  | 1,008 |
NOI from real estate operations | $ | 40,862 |  |  | $ | 7,769 |  |  | $ | 4,933 |  |  | $ | 3,858 |  |  | $ | 2,077 |  |  | $ | 5,655 |  |  | $ | 65,154 |  |  | $ | 12,344 |  |  | $ | 3,492 |  |  | $ | 1,020 |  |  | $ | 82,010 |
Additions to long-lived assets | $ | 5,901 |  |  | $ | 7,153 |  |  | $ | — |  |  | $ | 2,207 |  |  | $ | 2,642 |  |  | $ | — |  |  | $ | 17,903 |  |  | $ | 4,168 |  |  | $ | 108 |  |  | $ | 53 |  |  | $ | 22,232 |
Transfers from non-operating properties | $ | 5,331 |  |  | $ | 308 |  |  | $ | 3 |  |  | $ | — |  |  | $ | 3,100 |  |  | $ | 25,513 |  |  | $ | 34,255 |  |  | $ | (4 | ) |  | $ | 40 |  |  | $ | — |  |  | $ | 34,291 |
Three Months Ended September 30, 2015 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues from real estate operations | $ | 61,400 |  |  | $ | 12,875 |  |  | $ | 9,018 |  |  | $ | 6,886 |  |  | $ | 3,061 |  |  | $ | 5,665 |  |  | $ | 98,905 |  |  | $ | 26,782 |  |  | $ | 6,078 |  |  | $ | 1,921 |  |  | $ | 133,686 |
Property operating expenses | 20,106 |  |  | 5,150 |  |  | 4,553 |  |  | 3,287 |  |  | 888 |  |  | 532 |  |  | 34,516 |  |  | 9,596 |  |  | 4,008 |  |  | 777 |  |  | 48,897 |
UJV NOI allocable to COPT | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
NOI from real estate operations | $ | 41,294 |  |  | $ | 7,725 |  |  | $ | 4,465 |  |  | $ | 3,599 |  |  | $ | 2,173 |  |  | $ | 5,133 |  |  | $ | 64,389 |  |  | $ | 17,186 |  |  | $ | 2,070 |  |  | $ | 1,144 |  |  | $ | 84,789 |
Additions to long-lived assets | $ | 7,943 |  |  | $ | 1,603 |  |  | $ | — |  |  | $ | 2,084 |  |  | $ | 175 |  |  | $ | — |  |  | $ | 11,805 |  |  | $ | 129,259 |  |  | $ | — |  |  | $ | (27 | ) |  | $ | 141,037 |
Transfers from non-operating properties | $ | 25,184 |  |  | $ | (91 | ) |  | $ | 591 |  |  | $ | 1,408 |  |  | $ | 1,207 |  |  | $ | 34,287 |  |  | $ | 62,586 |  |  | $ | 5,505 |  |  | $ | 73,804 |  |  | $ | 315 |  |  | $ | 142,210 |
Nine Months Ended September 30, 2016 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues from real estate operations | $ | 184,881 |  |  | $ | 36,404 |  |  | $ | 34,408 |  |  | $ | 21,164 |  |  | $ | 9,496 |  |  | $ | 18,793 |  |  | $ | 305,146 |  |  | $ | 67,284 |  |  | $ | 20,106 |  |  | $ | 5,429 |  |  | $ | 397,965 |
Property operating expenses | 64,222 |  |  | 13,310 |  |  | 19,863 |  |  | 9,573 |  |  | 3,050 |  |  | 2,164 |  |  | 112,182 |  |  | 26,707 |  |  | 8,629 |  |  | 2,450 |  |  | 149,968 |
UJV NOI allocable to COPT | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1,008 |  |  | 1,008 |  |  | — |  |  | — |  |  | — |  |  | 1,008 |
NOI from real estate operations | $ | 120,659 |  |  | $ | 23,094 |  |  | $ | 14,545 |  |  | $ | 11,591 |  |  | $ | 6,446 |  |  | $ | 17,637 |  |  | $ | 193,972 |  |  | $ | 40,577 |  |  | $ | 11,477 |  |  | $ | 2,979 |  |  | $ | 249,005 |
Additions to long-lived assets | $ | 19,516 |  |  | $ | 13,290 |  |  | $ | — |  |  | $ | 5,710 |  |  | $ | 3,561 |  |  | $ | — |  |  | $ | 42,077 |  |  | $ | 9,107 |  |  | $ | 108 |  |  | $ | 363 |  |  | $ | 51,655 |
Transfers from non-operating properties | $ | 41,850 |  |  | $ | 28,158 |  |  | $ | 240 |  |  | $ | — |  |  | $ | 3,315 |  |  | $ | 81,467 |  |  | $ | 155,030 |  |  | $ | 104 |  |  | $ | (391 | ) |  | $ | (11 | ) |  | $ | 154,732 |
Segment assets at September 30, 2016 | $ | 1,261,337 |  |  | $ | 416,886 |  |  | $ | 132,722 |  |  | $ | 195,244 |  |  | $ | 111,310 |  |  | $ | 189,746 |  |  | $ | 2,307,245 |  |  | $ | 453,766 |  |  | $ | 234,551 |  |  | $ | 31,563 |  |  | $ | 3,027,125 |
Nine Months Ended September 30, 2015 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues from real estate operations | $ | 182,591 |  |  | $ | 37,383 |  |  | $ | 27,426 |  |  | $ | 21,337 |  |  | $ | 8,165 |  |  | $ | 15,816 |  |  | $ | 292,718 |  |  | $ | 73,142 |  |  | $ | 12,933 |  |  | $ | 5,798 |  |  | $ | 384,591 |
Property operating expenses | 63,102 |  |  | 16,120 |  |  | 14,665 |  |  | 10,075 |  |  | 2,605 |  |  | 1,726 |  |  | 108,293 |  |  | 26,750 |  |  | 8,441 |  |  | 2,506 |  |  | 145,990 |
UJV NOI allocable to COPT | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
NOI from real estate operations | $ | 119,489 |  |  | $ | 21,263 |  |  | $ | 12,761 |  |  | $ | 11,262 |  |  | $ | 5,560 |  |  | $ | 14,090 |  |  | $ | 184,425 |  |  | $ | 46,392 |  |  | $ | 4,492 |  |  | $ | 3,292 |  |  | $ | 238,601 |
Additions to long-lived assets | $ | 16,529 |  |  | $ | 86,303 |  |  | $ | — |  |  | $ | 5,446 |  |  | $ | 466 |  |  | $ | — |  |  | $ | 108,744 |  |  | $ | 198,589 |  |  | $ | 108 |  |  | $ | 282 |  |  | $ | 307,723 |
Transfers from non-operating properties | $ | 44,212 |  |  | $ | 51,117 |  |  | $ | 32,150 |  |  | $ | 1,408 |  |  | $ | 13,184 |  |  | $ | 50,295 |  |  | $ | 192,366 |  |  | $ | 22,230 |  |  | $ | 89,183 |  |  | $ | 327 |  |  | $ | 304,106 |
Segment assets at September 30, 2015 | $ | 1,284,712 |  |  | $ | 413,321 |  |  | $ | 134,790 |  |  | $ | 196,105 |  |  | $ | 108,541 |  |  | $ | 203,090 |  |  | $ | 2,340,559 |  |  | $ | 695,490 |  |  | $ | 246,806 |  |  | $ | 71,907 |  |  | $ | 3,354,762 |
The following table reconciles our segment revenues to total revenues as reported on our consolidated statements of operations (in thousands):
| For the Three Months Ended September 30, |  | For the Nine Months Ended September 30,
| 2016 |  | 2015 |  | 2016 |  | 2015
Segment revenues from real estate operations | $ | 130,954 |  |  | $ | 133,686 |  |  | $ | 397,965 |  |  | $ | 384,591 |
Construction contract and other service revenues | 11,149 |  |  | 17,058 |  |  | 34,372 |  |  | 97,554 |
Less: Revenues from discontinued operations | — |  |  | — |  |  | — |  |  | (4 | )
Total revenues | $ | 142,103 |  |  | $ | 150,744 |  |  | $ | 432,337 |  |  | $ | 482,141 |
The following table reconciles our segment property operating expenses to property operating expenses as reported on our consolidated statements of operations (in thousands):
| For the Three Months Ended September 30, |  | For the Nine Months Ended September 30,
| 2016 |  | 2015 |  | 2016 |  | 2015
Segment property operating expenses | $ | 49,952 |  |  | $ | 48,897 |  |  | $ | 149,968 |  |  | $ | 145,990 |
Less: Property operating expenses from discontinued operations | — |  |  | — |  |  | — |  |  | 6 |
Total property operating expenses | $ | 49,952 |  |  | $ | 48,897 |  |  | $ | 149,968 |  |  | $ | 145,996 |
The following table reconciles UJV NOI allocable to COPT to equity in income of unconsolidated entities as reported on our consolidated statements of operations (in thousands):
| For the Three Months Ended September 30, |  | For the Nine Months Ended September 30,
| 2016 |  | 2015 |  | 2016 |  | 2015
UJV NOI allocable to COPT | $ | 1,008 |  |  | $ | — |  |  | $ | 1,008 |  |  | $ | — |
Less: Income from UJV allocable to COPT attributable to depreciation and amortization expense and interest expense | (415 | ) |  | — |  |  | (415 | ) |  | — |
Add: Equity in income of unconsolidated non-real estate entities | 1 |  |  | 18 |  |  | 21 |  |  | 52 |
Equity in income of unconsolidated entities | $ | 594 |  |  | $ | 18 |  |  | $ | 614 |  |  | $ | 52 |
As previously discussed, we provide real estate services such as property management and construction and development services primarily for our properties but also for third parties. The primary manner in which we evaluate the operating performance of our service activities is through a measure we define as net operating income from service operations (“NOI from service operations”), which is based on the net of revenues and expenses from these activities. Construction contract and other service revenues and expenses consist primarily of subcontracted costs that are reimbursed to us by the customer along with a management fee. The operating margins from these activities are small relative to the revenue. We believe NOI from service operations is a useful measure in assessing both our level of activity and our profitability in conducting such operations. The table below sets forth the computation of our NOI from service operations (in thousands):
| For the Three Months Ended September 30, |  | For the Nine Months Ended September 30,
| 2016 |  | 2015 |  | 2016 |  | 2015
Construction contract and other service revenues | $ | 11,149 |  |  | $ | 17,058 |  |  | $ | 34,372 |  |  | $ | 97,554 |
Construction contract and other service expenses | (10,341 | ) |  | (16,132 | ) |  | (32,513 | ) |  | (94,923 | )
NOI from service operations | $ | 808 |  |  | $ | 926 |  |  | $ | 1,859 |  |  | $ | 2,631 |
The following table reconciles our NOI from real estate operations for reportable segments and NOI from service operations to income from continuing operations as reported on our consolidated statements of operations (in thousands):
| For the Three Months Ended September 30, |  | For the Nine Months Ended September 30,
| 2016 |  | 2015 |  | 2016 |  | 2015
NOI from real estate operations | $ | 82,010 |  |  | $ | 84,789 |  |  | $ | 249,005 |  |  | $ | 238,601 |
NOI from service operations | 808 |  |  | 926 |  |  | 1,859 |  |  | 2,631 |
Interest and other income | 1,391 |  |  | 692 |  |  | 3,877 |  |  | 3,217 |
Equity in income of unconsolidated entities | 594 |  |  | 18 |  |  | 614 |  |  | 52 |
Income tax (expense) benefit | 21 |  |  | (48 | ) |  | 28 |  |  | (153 | )
Depreciation and other amortization associated with real estate operations | (32,015 | ) |  | (38,403 | ) |  | (99,790 | ) |  | (103,788 | )
Impairment losses | (27,699 | ) |  | (2,307 | ) |  | (99,837 | ) |  | (3,545 | )
General, administrative and leasing expenses | (8,855 | ) |  | (7,439 | ) |  | (28,764 | ) |  | (22,864 | )
Business development expenses and land carry costs | (1,716 | ) |  | (5,573 | ) |  | (6,497 | ) |  | (10,986 | )
Interest expense | (18,301 | ) |  | (24,121 | ) |  | (64,499 | ) |  | (66,727 | )
NOI from discontinued operations | — |  |  | — |  |  | — |  |  | (10 | )
Less: UJV NOI allocable to COPT included in equity in income of unconsolidated entities | (1,008 | ) |  | — |  |  | (1,008 | ) |  | — |
(Loss) gain on early extinguishment of debt | (59 | ) |  | 85,745 |  |  | (37 | ) |  | 85,677 |
(Loss) income from continuing operations | $ | (4,829 | ) |  | $ | 94,279 |  |  | $ | (45,049 | ) |  | $ | 122,105 |
The following table reconciles our segment assets to the consolidated total assets of COPT and subsidiaries (in thousands):
| September 30, 2016 |  | September 30, 2015
Segment assets | $ | 3,027,125 |  |  | $ | 3,354,762 |
Non-operating property assets | 421,364 |  |  | 416,540 |
Other assets | 185,705 |  |  | 140,790 |
Total COPT consolidated assets | $ | 3,634,194 |  |  | $ | 3,912,092 |
The accounting policies of the segments are the same as those used to prepare our consolidated financial statements, except that discontinued operations are not presented separately for segment purposes. In the segment reporting presented above, we did not allocate interest expense, depreciation and amortization, impairment losses, (loss) gain on early extinguishment of debt, gain on sales of real estate and equity in income of unconsolidated entities not included in NOI to our real estate segments since they are not included in the measure of segment profit reviewed by management. We also did not allocate general, administrative and leasing expenses, business development expenses and land carry costs, interest and other income, income taxes and noncontrolling interests because these items represent general corporate or non-operating property items not attributable to segments.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8981-108599 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9038-108599 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 33 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8971-108599 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8595-108599 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8380-108599 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8984-108599 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9031-108599 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9054-108599 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8538-108599 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 29 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8864-108599 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8924-108599 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8906-108599 + Details
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