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Information by Business Segment | 3 Months Ended
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Mar. 31, 2022
Segment Reporting [Abstract] |
Information by Business Segment | Information by Business SegmentWe have the following reportable segments: Defense/IT Locations; Regional Office; Wholesale Data Center (the only property in which we sold on January 25, 2022); and Other. We also report on Defense/IT Locations sub-segments, which include the following: Fort George G. Meade and the Baltimore/Washington Corridor (“Fort Meade/BW Corridor”); Northern Virginia Defense/IT Locations (“NoVA Defense/IT”); Lackland Air Force Base (in San Antonio); locations serving the U.S. Navy (“Navy Support”), 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 fund the costs for the power, fiber connectivity and data center infrastructure). Our segment reporting included below reflects our retrospective reclassification of: certain activities to our Other reportable segment from our Wholesale Data Center reportable segment in the fourth quarter of 2021; and two properties to our NoVA Defense/IT sub-segment from our Regional Office segment in the first quarter of 2022.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; and the net of revenues and property operating expenses of real estate operations owned through unconsolidated real estate joint ventures (“UJVs”) that is allocable to our 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, right-of-use assets, net of related lease liabilities, 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):
| Defense/IT Locations |  |  |  |  |  |  |  |
| Fort Meade/BW Corridor |  | NoVA Defense/IT |  | Lackland Air Force Base |  | Navy Support |  | Redstone Arsenal |  | Data Center Shells |  | Total Defense/IT Locations |  | Regional Office |  | Wholesale Data Center |  | Other |  | Total
Three Months Ended March 31, 2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues from real estate operations | $ | 67,214 |  |  | $ | 18,576 |  |  | $ | 14,713 |  |  | $ | 8,169 |  |  | $ | 9,195 |  |  | $ | 7,505 |  |  | $ | 125,372 |  |  | $ | 15,082 |  |  | $ | 1,980 |  |  | $ | 1,826 |  |  | $ | 144,260 |
Property operating expenses | (25,784) |  |  | (6,869) |  |  | (7,072) |  |  | (3,471) |  |  | (3,735) |  |  | (1,010) |  |  | (47,941) |  |  | (7,930) |  |  | (1,025) |  |  | (1,256) |  |  | (58,152) |
UJV NOI allocable to COPT | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1,080 |  |  | 1,080 |  |  | — |  |  | — |  |  | — |  |  | 1,080 |
NOI from real estate operations | $ | 41,430 |  |  | $ | 11,707 |  |  | $ | 7,641 |  |  | $ | 4,698 |  |  | $ | 5,460 |  |  | $ | 7,575 |  |  | $ | 78,511 |  |  | $ | 7,152 |  |  | $ | 955 |  |  | $ | 570 |  |  | $ | 87,188 |
Additions to long-lived assets | $ | 11,785 |  |  | $ | 2,189 |  |  | $ | — |  |  | $ | 740 |  |  | $ | 235 |  |  | $ | — |  |  | $ | 14,949 |  |  | $ | 4,333 |  |  | $ | (51) |  |  | $ | 1 |  |  | $ | 19,232 |
Transfers from non-operating properties | $ | 5,369 |  |  | $ | 319 |  |  | $ | 418 |  |  | $ | 6,376 |  |  | $ | 76 |  |  | $ | 81,203 |  |  | $ | 93,761 |  |  | $ | 271 |  |  | $ | — |  |  | $ | — |  |  | $ | 94,032 |
Segment assets at March 31, 2022 | $ | 1,334,119 |  |  | $ | 488,479 |  |  | $ | 197,406 |  |  | $ | 175,176 |  |  | $ | 297,974 |  |  | $ | 430,447 |  |  | $ | 2,923,601 |  |  | $ | 536,909 |  |  | $ | — |  |  | $ | 3,901 |  |  | $ | 3,464,411 |
Three Months Ended March 31, 2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues from real estate operations | $ | 66,446 |  |  | $ | 16,185 |  |  | $ | 12,555 |  |  | $ | 8,398 |  |  | $ | 8,253 |  |  | $ | 8,787 |  |  | $ | 120,624 |  |  | $ | 15,703 |  |  | $ | 7,334 |  |  | $ | 1,503 |  |  | $ | 145,164 |
Property operating expenses | (24,671) |  |  | (6,336) |  |  | (6,874) |  |  | (3,433) |  |  | (2,554) |  |  | (1,082) |  |  | (44,950) |  |  | (7,204) |  |  | (3,823) |  |  | (997) |  |  | (56,974) |
UJV NOI allocable to COPT | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 917 |  |  | 917 |  |  | — |  |  | — |  |  | — |  |  | 917 |
NOI from real estate operations | $ | 41,775 |  |  | $ | 9,849 |  |  | $ | 5,681 |  |  | $ | 4,965 |  |  | $ | 5,699 |  |  | $ | 8,622 |  |  | $ | 76,591 |  |  | $ | 8,499 |  |  | $ | 3,511 |  |  | $ | 506 |  |  | $ | 89,107 |
Additions to long-lived assets | $ | 6,881 |  |  | $ | 298 |  |  | $ | — |  |  | $ | 552 |  |  | $ | 258 |  |  | $ | — |  |  | $ | 7,989 |  |  | $ | 4,009 |  |  | $ | 228 |  |  | $ | 4 |  |  | $ | 12,230 |
Transfers from non-operating properties | $ | 356 |  |  | $ | 88 |  |  | $ | 51 |  |  | $ | — |  |  | $ | 12,917 |  |  | $ | 985 |  |  | $ | 14,397 |  |  | $ | 357 |  |  | $ | — |  |  | $ | — |  |  | $ | 14,754 |
Segment assets at March 31, 2021 | $ | 1,270,467 |  |  | $ | 407,528 |  |  | $ | 141,044 |  |  | $ | 176,506 |  |  | $ | 293,107 |  |  | $ | 419,957 |  |  | $ | 2,708,609 |  |  | $ | 469,452 |  |  | $ | 199,029 |  |  | $ | 3,712 |  |  | $ | 3,380,802 |
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 March 31,
|  |  |  |  | 2022 |  | 2021
Segment revenues from real estate operations |  |  |  |  | $ | 144,260 |  |  | $ | 145,164 |
Construction contract and other service revenues |  |  |  |  | 53,200 |  |  | 16,558 |
Less: Revenues from discontinued operations (Note 4) |  |  |  |  | (1,980) |  |  | (7,334) |
Total revenues |  |  |  |  | $ | 195,480 |  |  | $ | 154,388 |
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 March 31,
|  | 2022 |  | 2021
Segment property operating expenses |  | $ | 58,152 |  |  | $ | 56,974 |
Less: Property operating expenses from discontinued operations (Note 4) |  | (971) |  |  | (3,698) |
Total property operating expenses |  | $ | 57,181 |  |  | $ | 53,276 |
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 March 31,
|  |  |  |  | 2022 |  | 2021
UJV NOI allocable to COPT |  |  |  |  | $ | 1,080 |  |  | $ | 917 |
Less: Income from UJV allocable to COPT attributable to depreciation and amortization expense and interest expense |  |  |  |  | (758) |  |  | (693) |
Add: Equity in income (loss) of unconsolidated non-real estate entities |  |  |  |  | 566 |  |  | (2) |
Equity in income of unconsolidated entities |  |  |  |  | $ | 888 |  |  | $ | 222 |
As previously discussed, we provide real estate services such as property management, development and construction 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 March 31,
|  |  |  |  | 2022 |  | 2021
Construction contract and other service revenues |  |  |  |  | $ | 53,200 |  |  | $ | 16,558 |
Construction contract and other service expenses |  |  |  |  | (51,650) |  |  | (15,793) |
NOI from service operations |  |  |  |  | $ | 1,550 |  |  | $ | 765 |
The following table reconciles our NOI from real estate operations for reportable segments and NOI from service operations to income (loss) from continuing operations as reported on our consolidated statements of operations (in thousands):
|  |  | For the Three Months Ended March 31,
|  |  |  |  | 2022 |  | 2021
NOI from real estate operations |  |  |  |  | $ | 87,188 |  |  | $ | 89,107 |
NOI from service operations |  |  |  |  | 1,550 |  |  | 765 |
Interest and other income |  |  |  |  | 1,893 |  |  | 1,865 |
Credit loss recoveries |  |  |  |  | 316 |  |  | 907 |
Gain on sales of real estate |  |  |  |  | 15 |  |  | (490) |
Equity in income of unconsolidated entities |  |  |  |  | 888 |  |  | 222 |
Income tax expense |  |  |  |  | (153) |  |  | (32) |
Depreciation and other amortization associated with real estate operations |  |  |  |  | (34,264) |  |  | (34,500) |
General, administrative and leasing expenses |  |  |  |  | (8,544) |  |  | (8,406) |
Business development expenses and land carry costs |  |  |  |  | (783) |  |  | (1,094) |
Interest expense |  |  |  |  | (14,424) |  |  | (17,519) |
UJV NOI allocable to COPT included in equity in income of unconsolidated entities |  |  |  |  | (1,080) |  |  | (917) |
Revenues from real estate operations from discontinued operations (Note 4) |  |  |  |  | (1,980) |  |  | (7,334) |
Property operating expenses from discontinued operations (Note 4) |  |  |  |  | 971 |  |  | 3,698 |
Loss on early extinguishment of debt |  |  |  |  | (342) |  |  | (33,166) |
Income (loss) from continuing operations |  |  |  |  | $ | 31,251 |  |  | $ | (6,894) |
The following table reconciles our segment assets to our consolidated total assets (in thousands):
|  | March 31, 2022 |  | March 31, 2021
Segment assets |  | $ | 3,464,411 |  |  | $ | 3,380,802 |
Operating properties lease liabilities included in segment assets |  | 29,729 |  |  | 30,151 |
Non-operating property assets |  | 419,346 |  |  | 492,230 |
Other assets |  | 218,540 |  |  | 209,765 |
Total consolidated assets |  | $ | 4,132,026 |  |  | $ | 4,112,948 |
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, gain on sales of real estate, loss on early extinguishment of debt 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, credit loss (expense) recoveries, 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/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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