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Investment in Real Estate | 12 Months Ended
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Dec. 31, 2017
Real Estate [Abstract] |
Investment in Real Estate | Investment in Real Estate The following table summarizes the Company’s investment in real estate, at cost as of:
| December 31, 2017 |  | December 31, 2016
Land | $ | 1,302,907 |  |  | $ | 1,155,037 |
Building and improvements | 4,480,993 |  |  | 4,069,005 |
Tenant improvements | 411,706 |  |  | 354,940 |
Furniture and fixtures | 8,608 |  |  | 4,264 |
Property under development | 219,227 |  |  | 295,234 |
Investment in real estate, at cost(1) | $ | 6,423,441 |  |  | $ | 5,878,480 |
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(1) | Excludes balances related to properties that have been classified as held for sale.
Acquisitions The following table summarizes the information on the acquisitions completed in 2017 and 2016:
Property |  | Submarket |  | Segment |  | Month of Acquisition |  | Square Feet |  | Purchase Price(1) (in millions)
Sunset Las Palmas Studios(2) |  | Hollywood |  | Media and Entertainment |  | May 2017 |  | 369,000 |  |  | $ | 200.0 |
11601 Wilshire land(3) |  | West Los Angeles |  | Office |  | June 2017 |  | N/A |  |  | 50.0 |
6666 Santa Monica(4) |  | Hollywood |  | Media and Entertainment |  | June 2017 |  | 4,150 |  |  | 3.2 |
Total acquisitions in 2017 |  |  |  |  |  |  |  | 373,150 |  |  | $ | 253.2 |
11601 Wilshire(5) |  | West Los Angeles |  | Office |  | July 2016 |  | 500,475 |  |  | $ | 311.0 |
Hill7(6) |  | South Lake Union |  | Office |  | October 2016 |  | 285,680 |  |  | 179.8 |
Page Mill Hill(7) |  | Palo Alto |  | Office |  | December 2016 |  | 182,676 |  |  | 150.0 |
Total acquisitions in 2016 |  |  |  |  |  |  |  | 968,831 |  |  | $ | 640.8 |
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(1) | Represents purchase price before certain credits, prorations and closing costs.
(2) | The property consists of stages, production office and support space on 15 acres near Sunset Gower Studios and Sunset Bronson Studios. The purchase price above does not include equipment purchased by the Company for $2.8 million, which was transacted separately from the studio acquisition. In April 2017, the Company drew $150.0 million under the unsecured revolving credit facility to fund the acquisition.
(3) | On July 1, 2016 the Company purchased a partial interest in land held as a tenancy in common in conjunction with its acquisition of the 11601 Wilshire property. The land interest held as a tenancy in common was accounted for as an equity method investment. On June 15, 2017, the Company purchased the remaining interest, which was fair valued and allocated to land and building.
(4) | This parcel is adjacent to the Sunset Las Palmas Studios property.
(5) | Previously owned by an affiliate of Blackstone, the property has served as the Company’s corporate headquarters since its IPO. The Company funded this acquisition with proceeds from the unsecured revolving credit facility.
(6) | The Company purchased the property through a joint venture with the Canadian Pension Plan Investment Board. The Company has a 55% ownership interest in the consolidated joint venture. In conjunction with the acquisition, the joint venture closed a secured non-recourse loan in the amount of $101.0 million.
(7) | The Company funded this acquisition with proceeds from the unsecured revolving credit facility.
The Company’s acquisitions in 2017 did not meet the definition of a business and were therefore accounted for as asset acquisitions. In accordance with asset acquisitions, the purchase price includes capitalized acquisition costs. The following table represents the Company’s final aggregate purchase price accounting, as of the respective acquisition dates, for each of the Company’s acquisitions completed in 2017:
|  | Sunset Las Palmas Studios(1) |  | 11601 Wilshire land |  | 6666 Santa Monica |  | Total
Investment in real estate |  | $ | 202,723 |  |  | $ | 50,034 |  |  | $ | 3,091 |  |  | $ | 255,848 |
Deferred leasing costs and in-place lease intangibles(2) |  | 1,741 |  |  | — |  |  | 145 |  |  | 1,886 |
Total assets assumed |  | $ | 204,464 |  |  | $ | 50,034 |  |  | $ | 3,236 |  |  | $ | 257,734 |
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(1) | The purchase price allocation includes equipment purchased by the Company of $2.8 million.
(2) | Represents weighted-average amortization period of 1.2 years.
The following table represents the final purchase price accounting for each of the Company’s acquisitions completed in 2016:
| 11601 Wilshire |  | Hill7 |  | Page Mill Hill |  | Total
Investment in real estate, net | $ | 292,382 |  |  | $ | 173,967 |  |  | $ | 131,402 |  |  | $ | 597,751 |
Land interest(1) | 7,836 |  |  | — |  |  | — |  |  | 7,836 |
Above-market leases(2) | 167 |  |  | — |  |  | 307 |  |  | 474 |
Below-market ground leases(3) | 212 |  |  | — |  |  | 12,125 |  |  | 12,337 |
Deferred leasing costs and lease intangibles(4) | 13,884 |  |  | 7,617 |  |  | 14,697 |  |  | 36,198 |
Below-market leases(5) | (6,562 | ) |  | (1,417 | ) |  | (8,636 | ) |  | (16,615 | )
Net asset and liabilities assumed | $ | 307,919 |  |  | $ | 180,167 |  |  | $ | 149,895 |  |  | $ | 637,981 |
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(1) | Represents the fair value of the Company’s interest in the land which was included in investment in unconsolidated entities in the Consolidated Balance Sheets at December 31, 2016. On June 15, 2017, the Company purchased the remaining interest, which was fair valued and allocated to land and building. Refer to the 2017 acquisitions above for details.
(2) | Represents weighted-average amortization period of 5.4 years.
(3) | Represents weighted-average amortization period of 33.2 years.
(4) | Represents weighted-average amortization period of 5.8 years.
(5) | Represents weighted-average amortization period of 6.4 years.
Dispositions The following table summarizes the properties sold in 2017, 2016 and 2015. These properties were considered non-strategic to the Company’s portfolio:
Property | Month of Disposition |  | Square Feet |  | Sales Price(1) (in millions)
222 Kearny | February 2017 |  | 148,797 |  |  | $ | 51.8 |
3402 Pico | March 2017 |  | 50,687 |  |  | 35.0 |
Pinnacle I and Pinnacle II(2) | November 2017 |  | 623,777 |  |  | 350.0 |
Total dispositions in 2017 |  |  | 823,261 |  |  | $ | 436.8 |
Bayhill Office Center | January 2016 |  | 554,328 |  |  | $ | 215.0 |
Patrick Henry | April 2016 |  | 70,520 |  |  | 19.0 |
One Bay Plaza | June 2016 |  | 195,739 |  |  | 53.4 |
12655 Jefferson | November 2016 |  | 100,756 |  |  | 80.0 |
Total dispositions in 2016(3) |  |  | 921,343 |  |  | $ | 367.4 |
First Financial | March 2015 |  | 223,679 |  |  | $ | 89.0 |
Bay Park Plaza | September 2015 |  | 260,183 |  |  | 90.0 |
Total dispositions in 2015(4) |  |  | 483,862 |  |  | $ | 179.0 |
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(1) | Represents gross sales price before certain credits, prorations and closing costs.
(2) | The consolidated joint venture that owned Pinnacle I and Pinnacle II sold the properties to affiliates of Blackstone. In conjunction with the sale, the $216.0 million debt secured by these properties was assumed by the purchasers.
(3) | Excludes the sale of an option to acquire land at 9300 Culver on December 6, 2016.
(4) | Excludes the 45% ownership interest in 1455 Market completed on January 7, 2015.
The disposition of these properties resulted in gains of $45.6 million, $30.4 million and $30.5 million for the years ended December 31, 2017, 2016 and 2015, respectively. Included in gains on sale of real estate line item on the Consolidated Statements of Operations in 2016 is a gain of $7.5 million related to a sale of an option to purchase land at 9300 Culver. Held for sale As of December 31, 2017, the Company had four properties that met the criteria to be classified as held for sale. The following table summarizes properties classified as held for sale as of December 31, 2017:
Property |  | Purchase and Sale Executed |  | Square Feet |  | Sales Price(1) (in millions)
2180 Sand Hill |  | November 2017 |  | 45,613 |  |  | $ | 82.5 |
2600 Campus Drive (building 6 of Peninsula Office Park) |  | December 2017 |  | 63,050 |  |  | 22.5 |
Embarcadero Place |  | December 2017 |  | 197,402 |  |  | 136.0 |
9300 Wilshire |  | December 2017 |  | 61,422 |  |  | 13.8 |
Total |  |  |  | 367,487 |  |  | $ | 254.8 |
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(1) | Represents gross sales price before certain credits, prorations and closing costs.
As of December 31, 2016, the Company had eight properties that met the criteria to be classified as held for sale which includes the properties sold during 2017. The following table summarizes the components of assets and liabilities associated with real estate held for sale as of:
| December 31, 2017 |  | December 31, 2016
ASSETS |  |  |
Investment in real estate, net | $ | 204,895 |  |  | $ | 580,261 |
Accounts receivable, net | 85 |  |  | 183 |
Straight-line rent receivables, net | 2,234 |  |  | 8,849 |
Deferred leasing costs and lease intangible assets, net | 4,063 |  |  | 23,078 |
Prepaid expenses and other assets, net | 58 |  |  | 2,803 |
Assets associated with real estate held for sale | $ | 211,335 |  |  | $ | 615,174 |
LIABILITIES |  |  |
Notes payable, net | $ | — |  |  | $ | 214,684 |
Accounts payable and accrued liabilities | 782 |  |  | 8,816 |
Lease intangible liabilities, net | 95 |  |  | 6,890 |
Security deposits and prepaid rent | 1,339 |  |  | 6,233 |
Liabilities associated with real estate held for sale | $ | 2,216 |  |  | $ | 236,623 |

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- Definition The entire disclosure for certain real estate investment financial statements, real estate investment trust operating support agreements, real estate owned, retail land sales, time share transactions, as well as other real estate related disclosures. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 970 -URI http://asc.fasb.org/topic&trid=2156125 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 972 -URI http://asc.fasb.org/topic&trid=2134617 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 978 -URI http://asc.fasb.org/topic&trid=2134977 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 974 -URI http://asc.fasb.org/topic&trid=2156429 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 976 -URI http://asc.fasb.org/topic&trid=2134846 + Details
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