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Financial Instruments and Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2020

Fair Value Disclosures [Abstract]

Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis

The following table presents the Company’s fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis (in thousands):

		March 31, 2020												December 31, 2019
		Level 1				Level 2				Level 3				Level 1				Level 2				Level 3
Assets
Money market funds		$	—			$	—			$	—			$	—			$	—			$	—
Derivative financial instruments			—				14				—				—				2,583				—
Liabilities
Derivative financial instruments			—				104,253				—				—				39,061				—

Schedule of Items Measured at Fair Value on Nonrecurring Basis

During March of 2020, the Company was impacted by the COVID-19 Pandemic (Note 15), which caused the Company to re-evaluate its holding periods and forecasted operating income at certain properties. As a result, several impairments were recorded at Fund assets. Impairment charges for the periods presented are as follows (in thousands):

Impairment Charge

Property and Location

Owner

Triggering Event

Level 3 Inputs

Effective Date

Total

Acadia's Share

2020 Impairment Charges

Cortlandt Crossing, Mohegan Lake, NY

Fund III

Reduced holding period, reduced projected operating income

Projections of: holding period, net operating income, cap rate, incremental costs

3/31/2020

$

27,402

$

6,726

654 Broadway, New York, NY

Fund III

Reduced holding period

Projections of: holding period, net operating income, cap rate, incremental costs

3/31/2020

6,398

1,570

146 Geary Street, San Francisco, CA

Fund IV

Reduced holding period, reduced projected operating income

Projections of: holding period, net operating income, cap rate, incremental costs

3/31/2020

6,718

1,553

801 Madison Avenue, New York, NY

Fund IV

Reduced holding period, reduced projected operating income

Projections of: holding period, net operating income, cap rate, incremental costs

3/31/2020

11,031

2,551

Total 2020 Impairment Charges

$

51,549

$

12,400

2019 Impairment Charges

210 Bowery residential units

Fund IV

Reduced selling price

Contract sales price

9/30/2019

$

321

$

74

210 Bowery residential units

Fund IV

Reduced selling price

Offering price

6/30/2019

1,400

321

Total 2019 Impairment Charges

$

1,721

$

395

Schedule of Derivative Financial Instruments

The Company had the following interest rate swaps and caps for the periods presented (dollars in thousands):

														Strike Rate												Fair Value
Derivative Instrument		Aggregate Notional Amount				Effective Date				Maturity Date				Low						High				Balance Sheet Location		March 31, 2020				December 31, 2019
Core
Interest Rate Swaps		$	562,297			Dec 2012-Apr 2023				Jul 2020-Apr 2033					1.24	%		—			3.77	%		Other Liabilities (a)		$	(85,461	)		$	(33,750	)
Interest Rate Swaps			—				—				—				—			—			—			Other Assets			—				456
		$	562,297																							$	(85,461	)		$	(33,294	)
Fund II
Interest Rate Swap		$	19,007			Oct 2014				Nov 2021					2.88	%		—			2.88	%		Other Liabilities		$	(380	)		$	(139	)
Interest Rate Cap			45,000			Mar 2019				Mar 2022					3.50	%		—			3.50	%		Other Assets			12				1
		$	64,007																							$	(368	)		$	(138	)
Fund III
Interest Rate Cap		$	39,470			Jan 2020				Jan 2021					3.00	%		—			3.00	%		Other Assets		$	—			$	—
Fund IV
Interest Rate Swaps			—				—				—				—			—			—			Other Assets			—			$	22
Interest Rate Swaps			79,208			Mar 2017 - Dec 2019				Apr 2022 - Dec 2022					1.48	%		—			4.00	%		Other Liabilities			(2,782	)			(812	)
Interest Rate Caps			90,600			July 2019 - Dec 2019				Dec 2020 - July 2021					3.00	%		—			3.50	%		Other Assets			2				—
		$	169,808																							$	(2,780	)		$	(790	)
Fund V
Interest Rate Swaps			—				—				—				—			—			—			Other Assets			—			$	2,104
Interest Rate Swaps			334,593			Jan 2018-Nov 2019				Feb 2021-Oct 2024					1.25	%		—			2.88	%		Other Liabilities			(15,630	)			(4,360	)
		$	334,593																							$	(15,630	)		$	(2,256	)
Total asset derivatives																										$	14			$	2,583
Total liability derivatives																										$	(104,253	)		$	(39,061	)

(a) Includes two swaps with an aggregate fair value of ($25.4) million and ($11.8) million at March 31, 2020 and December 31, 2019, respectively, which were acquired during July 2018 with a notional value of $125.0 million and are not effective until July 2020. Includes one swap with an aggregate value of ($2.8) million at March 31, 2020, which was acquired during February 2020 with a notional value of $50.0 million and is not effective until April 2023. Includes one swap with an aggregate fair value of ($2.6) million at March 31, 2020, which was acquired during February 2020 with a notional value of $50.0 million and is not effective until April 2023.

Schedule of Other Financial Instruments Carrying Values and Fair values

The Company’s other financial instruments had the following carrying values and fair values as of the dates shown (dollars in thousands, inclusive of amounts attributable to noncontrolling interests where applicable):

						March 31, 2020								December 31, 2019
		Level				Carrying Amount				Estimated Fair Value				Carrying Amount				Estimated Fair Value
Notes Receivable (a)			3			$	174,089			$	175,462			$	114,943			$	113,422
Mortgage and Other Notes Payable (a)			3				1,178,705				1,183,469				1,179,503				1,191,281
Investment in non-traded equity securities (b)			3				2,019				57,866				1,778				57,964
Unsecured notes payable and Unsecured line of credit (c)			2				655,670				650,323				538,425				539,362

(a) The Company determined the estimated fair value of these financial instruments using a discounted cash flow model with rates that take into account the credit of the borrower or tenant, where applicable, and interest rate risk. The Company also considered the value of the underlying collateral, taking into account the quality of the collateral, the credit quality of the borrower, the time until maturity and the current market interest rate environment.

(b) Represents Fund II’s cost-method investment in Albertsons’ supermarkets and the Operating Partnership’s cost-method investment in Fifth Wall (Note 4).

(c) The Company determined the estimated fair value of the unsecured notes payable and unsecured line of credit using quoted market prices in an open market with limited trading volume where available. In cases where there was no trading volume, the Company determined the estimated fair value using a discounted cash flow model using a rate that reflects the average yield of similar market participants.

X

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

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Tabular disclosure of the location and fair value amounts of derivative instruments (and nonderivative instruments that are designated and qualify as hedging instruments) reported in the statement of financial position.

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Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

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