Segment Reporting

The Company has determined that it has four reportable segments based on how management reviews and manages its business. These reportable segments include: Real Estate Finance, Net Lease, Operating Properties and Land. The Real Estate Finance segment includes all of the Company's activities related to senior and mezzanine real estate loans and real estate related securities. The Net Lease segment includes all of the Company's activities related to the ownership and leasing of corporate facilities. The Operating Properties segment includes all of the Company's activities and operations related to its commercial and residential properties. The Land segment includes the Company's activities related to its developable land portfolio.

The Company evaluates performance based on the following financial measures for each segment. The Company's segment information is as follows ($ in thousands):



	Real Estate Finance			Net Lease			Operating Properties			Land			Corporate/Other(1)			Company Total
For the Year Ended December 31, 2013
Operating lease income	$	—		$	147,313		$	86,352		$	902		$	—		$	234,567
Interest income	108,015			—			—			—			—			108,015
Other income	4,748			250			38,164			1,474			3,572			48,208
Total revenue	$	112,763		$	147,563		$	124,516		$	2,376		$	3,572		$	390,790
Earnings (loss) from equity method investments	—			2,699			5,546			(5,331		)	38,606			41,520
Income from sales of residential property	—			—			82,603			4,055			—			86,658
Net operating income from discontinued operations(2)	—			1,484			1,251			—			—			2,735
Gain from discontinued operations	—			3,395			18,838			—			—			22,233
Revenue and other earnings	$	112,763		$	155,141		$	232,754		$	1,100		$	42,178		$	543,936
Real estate expense	—			(22,565		)	(101,044		)	(33,832		)	—			(157,441		)
Other expense	(1,625		)	—			—			—			(6,425		)	(8,050		)
Allocated interest expense(2)	(74,377		)	(80,034		)	(49,114		)	(30,368		)	(32,332		)	(266,225		)
Allocated general and administrative(3)	(13,186		)	(14,330		)	(9,189		)	(12,365		)	(23,783		)	(72,853		)
Segment profit (loss)(4)	$	23,575		$	38,212		$	73,407		$	(75,465	)	$	(20,362	)	$	39,367
Other significant non-cash items:
Provision for loan losses	$	5,489		$	—		$	—		$	—		$	—		$	5,489
Impairment of assets(2)	$	—		$	1,176		$	12,449		$	728		$	—		$	14,353
Loss on transfer of interest to unconsolidated subsidiary	$	—		$	—		$	—		$	7,373		$	—		$	7,373
Depreciation and amortization(2)	$	—		$	38,582		$	30,599		$	1,105		$	1,244		$	71,530
Capitalized expenditures	$	—		$	34,076		$	41,131		$	36,346		$	—		$	111,553
As of December 31, 2013
Real estate
Real estate, at cost	$	—		$	1,696,888		$	720,508		$	803,238		$	—		$	3,220,634
Less: accumulated depreciation	—			(338,640		)	(82,420		)	(3,393		)	—			(424,453		)
Real estate, net	$	—		$	1,358,248		$	638,088		$	799,845		$	—		$	2,796,181
Real estate available and held for sale	—			—			228,328			132,189			—			360,517
Total real estate	$	—		$	1,358,248		$	866,416		$	932,034		$	—		$	3,156,698
Loans receivable and other lending investments, net	1,370,109			—			—			—			—			1,370,109
Other investments	—			16,408			16,032			29,765			145,004			207,209
Total portfolio assets	$	1,370,109		$	1,374,656		$	882,448		$	961,799		$	145,004		$	4,734,016
Cash and other assets																907,995
Total assets																$	5,642,011




	Real Estate Finance			Net Lease			Operating Properties			Land			Corporate/Other(1)			Company Total
For the Year Ended December 31, 2012(5)
Operating lease income	$	—		$	149,058		$	65,706		$	1,527		$	—		$	216,291
Interest income	133,410			—			—			—			—			133,410
Other income	8,613			—			32,615			2,635			3,975			47,838
Total revenue	$	142,023		$	149,058		$	98,321		$	4,162		$	3,975		$	397,539
Earnings (loss) from equity method investments	—			2,632			25,142			(6,138		)	81,373			103,009
Income from sales of residential property	—			—			63,472			—			—			63,472
Net operating income from discontinued operations(2)	—			7,289			886			—			—			8,175
Gain from discontinued operations	—			27,257			—			—			—			27,257
Revenue and other earnings	$	142,023		$	186,236		$	187,821		$	(1,976	)	$	85,348		$	599,452
Real estate expense	—			(23,886		)	(100,258		)	(27,314		)	—			(151,458		)
Other expense	(4,775		)	—			—			—			(12,491		)	(17,266		)
Allocated interest expense(2)	(111,898		)	(92,579		)	(69,259		)	(44,125		)	(38,300		)	(356,161		)
Allocated general and administrative(3)	(14,263		)	(10,618		)	(7,572		)	(7,405		)	(25,705		)	(65,563		)
Segment profit (loss)(4)	$	11,087		$	59,153		$	10,732		$	(80,820	)	$	8,852		$	9,004
Other significant non-cash items:
Provision for loan losses	$	81,740		$	—		$	—		$	—		$	—		$	81,740
Impairment of assets(2)	$	—		$	6,670		$	28,501		$	205		$	978		$	36,354
Depreciation and amortization(2)	$	—		$	39,250		$	28,450		$	1,276		$	1,810		$	70,786
Capitalized expenditures	$	—		$	10,994		$	51,579		$	20,497		$	—		$	83,070
As of December 31, 2012
Real estate
Real estate, at cost	$	—		$	1,626,810		$	704,481		$	786,114		$	—		$	3,117,405
Less: accumulated depreciation	—			(310,605		)	(65,409		)	(2,292		)	—			(378,306		)
Real estate, net	$	—		$	1,316,205		$	639,072		$	783,822		$	—		$	2,739,099
Real estate available and held for sale	—			—			454,587			181,278			—			635,865
Total real estate	$	—		$	1,316,205		$	1,093,659		$	965,100		$	—		$	3,374,964
Loans receivable and other lending investments, net	1,829,985			—			—			—			—			1,829,985
Other investments	—			16,380			25,745			5,493			351,225			398,843
Total portfolio assets	$	1,829,985		$	1,332,585		$	1,119,404		$	970,593		$	351,225		$	5,603,792
Cash and other assets																556,207
Total assets																$	6,159,999



	Real Estate Finance			Net Lease			Operating Properties			Land			Corporate/Other(1)			Company Total
For the Year Ended December 31, 2011(5)
Operating lease income	$	—		$	144,548		$	51,153		$	171		$	—		$	195,872
Interest income	226,871			—			—			—			—			226,871
Other income	3,176			—			32,538			1,637			2,371			39,722
Total revenue	$	230,047		$	144,548		$	83,691		$	1,808		$	2,371		$	462,465
Earnings (loss) from equity method investments	—			2,566			(626		)	(7,213		)	100,364			95,091
Income from sales of residential property	—			—			5,721			—			—			5,721
Net operating income from discontinued operations(2)	—			14,135			(937		)	—			—			13,198
Gain from discontinued operations	—			25,110			—			—			—			25,110
Revenue and other earnings	$	230,047		$	186,359		$	87,849		$	(5,405	)	$	102,735		$	601,585
Real estate expense	—			(25,054		)	(92,012		)	(21,648		)	—			(138,714		)
Other expense	(2,866		)	—			—			—			(8,204		)	(11,070		)
Allocated interest expense(2)	(156,163		)	(75,844		)	(52,774		)	(40,480		)	(20,653		)	(345,914		)
Allocated general and administrative(3)	(19,934		)	(9,681		)	(6,737		)	(6,959		)	(32,026		)	(75,337		)
Segment profit (loss)(4)	$	51,084		$	75,780		$	(63,674	)	$	(74,492	)	$	41,852		$	30,550
Other significant non-cash items:
Provision for loan losses	$	46,412		$	—		$	—		$	—		$	—		$	46,412
Impairment of assets(2)	$	—		$	668		$	21,030		$	(184	)	$	872		$	22,386
Depreciation and amortization(2)	$	—		$	42,080		$	18,169		$	1,534		$	2,145		$	63,928
Capitalized expenditures	$	—		$	8,699		$	38,477		$	16,993		$	—		$	64,169

Explanatory Notes:

_______________________________________________________________________________

(1)

Corporate/Other represents all corporate level and unallocated items including any intercompany eliminations necessary to reconcile to consolidated Company totals. This caption also includes the Company's joint venture investments and strategic investments that are not related to the other reportable segments above, including the Company's equity investment in LNR of $205.8 million as of December 31, 2012 and the Company's share of equity in earnings from LNR of $16.5 million, $60.7 million and $53.9 million for the years ended December 31, 2013, 2012 and 2011, respectively. See Note 6 for further details on the Company's investment in LNR and summarized financial information of LNR.


(2)	Includes related amounts reclassified to discontinued operations on the Company's Consolidated Statements of Operations.


(3)	General and administrative excludes stock-based compensation expense of $19.3 million, $15.3 million and $29.7 million for the years ended December 31, 2013, 2012 and 2011, respectively.


(4)	The following is a reconciliation of segment profit (loss) to net income (loss) ($ in thousands):



	For the Years Ended December 31,
	2013			2012			2011
Segment profit (loss)	$	39,367		$	9,004		$	30,550
Less: Provision for loan losses	(5,489		)	(81,740		)	(46,412		)
Less: Impairment of assets(2)	(14,353		)	(36,354		)	(22,386		)
Less: Loss on transfer of interest to unconsolidated subsidiary	(7,373		)	—			—
Less: Stock-based compensation expense	(19,261		)	(15,293		)	(29,702		)
Less: Depreciation and amortization(2)	(71,530		)	(70,786		)	(63,928		)
Less: Income tax (expense) benefit(2)	596			(8,445		)	4,719
Add: Gain (loss) on early extinguishment of debt, net	(33,190		)	(37,816		)	101,466
Net income (loss)	$	(111,233	)	$	(241,430	)	$	(25,693	)


(5)	The prior periods' presentation have been conformed for the change in the methodology of allocating interest expense and general and administrative expenses to each segment based on gross carrying value of assets. The allocation was previously based on carrying value of assets net of accumulated depreciation and amortization and general loan loss reserves.