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
Three Months Ended September 30, 2014:
Operating lease income	$	—		$	36,947		$	23,513		$	231		$	—		$	60,691
Interest income	31,098			—			—			—			—			31,098
Other income	885			3,573			11,795			496			1,658			18,407
Land sales revenue	—			—			—			3,290			—			3,290
Total revenue	31,983			40,520			35,308			4,017			1,658			113,486
Earnings (loss) from equity method investments	—			349			177			123			48,929			49,578
Income from sales of real estate	—			—			27,791			—			—			27,791
Revenue and other earnings	31,983			40,869			63,276			4,140			50,587			190,855
Real estate expense	—			(6,059		)	(28,795		)	(6,431		)	—			(41,285		)
Land cost of sales	—			—			—			(2,763		)	—			(2,763		)
Other expense	(283		)	—			—			—			568			285
Allocated interest expense	(14,187		)	(18,156		)	(10,169		)	(7,490		)	(5,422		)	(55,424		)
Allocated general and administrative(2)	(3,492		)	(4,610		)	(2,699		)	(3,566		)	(5,737		)	(20,104		)
Segment profit (loss)(3)	$	14,021		$	12,044		$	21,613		$	(16,110	)	$	39,996		$	71,564
Other significant non-cash items:
Provision for (recovery of) loan losses	$	(673	)	$	—		$	—		$	—		$	—		$	(673	)
Impairment of assets	—			231			4,231			11,000			—			15,462
Depreciation and amortization	—			9,522			7,606			320			274			17,722
Capitalized expenditures	—			595			20,555			25,655			—			46,805
Three Months Ended September 30, 2013:
Operating lease income	$	—		$	36,063		$	24,164		$	—		$	—		$	60,227
Interest income	24,235			—			—			—			—			24,235
Other income	1,731			—			8,045			333			1,125			11,234
Total revenue	25,966			36,063			32,209			333			1,125			95,696
Earnings (loss) from equity method investments	—			679			533			(2,178		)	5,311			4,345
Income from sales of real estate	—			—			14,075			—			—			14,075
Income (loss) from discontinued operations(4)	—			350			486			—			—			836
Gain from discontinued operations	—			—			9,166			—			—			9,166
Revenue and other earnings	25,966			37,092			56,469			(1,845		)	6,436			124,118
Real estate expense	—			(5,191		)	(25,152		)	(7,203		)	—			(37,546		)
Other expense	(253		)	—			—			—			(1,242		)	(1,495		)
Allocated interest expense(5)	(16,172		)	(19,066		)	(11,082		)	(7,541		)	(9,932		)	(63,793		)
Allocated general and administrative(2)	(3,610		)	(4,282		)	(2,735		)	(2,487		)	(6,608		)	(19,722		)
Segment profit (loss)(3)	$	5,931		$	8,553		$	17,500		$	(19,076	)	$	(11,346	)	$	1,562
Other significant non-cash items:
Provision for (recovery of) loan losses	$	(9,834	)	$	—		$	—		$	—		$	—		$	(9,834	)
Impairment of assets(5)	—			494			6,291			—			—			6,785
Depreciation and amortization(5)	—			9,556			8,884			288			291			19,019
Capitalized expenditures	—			4,322			11,906			8,877			—			25,105



	Real Estate Finance			Net Lease			Operating Properties			Land			Corporate/Other(1)			Company Total
Nine Months Ended September 30, 2014:
Operating lease income	$	—		$	113,502		$	69,631		$	633		$	—		$	183,766
Interest income	94,139			—			—			—			—			94,139
Other income	20,327			4,306			32,335			865			4,420			62,253
Land sales revenue	—			—			—			11,920			—			11,920
Total revenue	114,466			117,808			101,966			13,418			4,420			352,078
Earnings (loss) from equity method investments	—			1,497			1,125			(286		)	74,512			76,848
Income from sales of real estate	—			—			61,465			—			—			61,465
Revenue and other earnings	114,466			119,305			164,556			13,132			78,932			490,391
Real estate expense	—			(17,253		)	(86,338		)	(20,861		)	—			(124,452		)
Land cost of sales	—			—			—			(10,028		)	—			(10,028		)
Other expense	(1,016		)	—			—			—			(3,610		)	(4,626		)
Allocated interest expense	(45,497		)	(54,775		)	(30,657		)	(21,943		)	(16,538		)	(169,410		)
Allocated general and administrative(2)	(11,026		)	(13,592		)	(7,966		)	(10,839		)	(17,821		)	(61,244		)
Segment profit (loss)(3)	$	56,927		$	33,685		$	39,595		$	(50,539	)	$	40,963		$	120,631
Other significant non-cash items:
Provision for (recovery of) loan losses	$	(6,865	)	$	—		$	—		$	—		$	—		$	(6,865	)
Impairment of assets	—			3,210			8,131			10,400			—			21,741
Depreciation and amortization	—			29,332			23,838			1,114			873			55,157
Capitalized expenditures	—			169			46,973			58,711			—			105,853
Nine Months Ended September 30, 2013:
Operating lease income	$	—		$	108,497		$	66,857		$	—		$	—		$	175,354
Interest income	78,584			—			—			—			—			78,584
Other income	4,229			—			27,623			833			3,093			35,778
Total revenue	82,813			108,497			94,480			833			3,093			289,716
Earnings (loss) from equity method investments	—			2,017			5,006			(5,268		)	32,591			34,346
Income from sales of real estate	—			—			68,615			3,477			—			72,092
Income (loss) from discontinued operations(4)	—			1,354			1,328			—			—			2,682
Gain from discontinued operations	—			3,395			19,093			—			—			22,488
Revenue and other earnings	82,813			115,263			188,522			(958		)	35,684			421,324
Real estate expense	—			(16,433		)	(75,695		)	(20,234		)	—			(112,362		)
Other expense	(1,586		)	—			—			—			(5,680		)	(7,266		)
Allocated interest expense(5)	(55,500		)	(59,296		)	(37,259		)	(23,226		)	(29,235		)	(204,516		)
Allocated general and administrative(2)	(9,661		)	(10,353		)	(7,140		)	(6,122		)	(19,248		)	(52,524		)
Segment profit (loss)(3)	$	16,066		$	29,181		$	68,428		$	(50,540	)	$	(18,479	)	$	44,656
Other significant non-cash items:
Provision for (recovery of) loan losses	$	5,392		$	—		$	—		$	—		$	—		$	5,392
Impairment of assets(5)	—			494			6,687			—			—			7,181
Depreciation and amortization(5)	—			28,787			23,321			817			948			53,873
Capitalized expenditures	—			21,977			26,312			24,476			—			72,765



	Real Estate Finance		Net Lease		Operating Properties		Land		Corporate/Other(1)		Company Total
As of September 30, 2014
Real estate
Real estate, net	—		1,215,034		626,713		841,079		—		2,682,826
Real estate available and held for sale	—		—		196,597		121,367		—		317,964
Total real estate	—		1,215,034		823,310		962,446		—		3,000,790
Loans receivable and other lending investments, net	1,190,746		—		—		—		—		1,190,746
Other investments	—		127,070		14,223		65,949		107,033		314,275
Total portfolio assets	$	1,190,746	$	1,342,104	$	837,533	$	1,028,395	$	107,033	4,505,811
Cash and other assets											974,814
Total assets											$	5,480,625
As of December 31, 2013
Real estate
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

Explanatory Notes:

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(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 share of equity in earnings from LNR of $16.5 million for the nine months ended September 30, 2013. See Note 6 for further details on the Company's investment in LNR and summarized financial information of LNR.


(2)	General and administrative excludes stock-based compensation expense of $3.3 million and $8.5 million for the three and nine months ended September 30, 2014, respectively, and $4.6 million and $14.5 million for the three and nine months ended September 30, 2013, respectively.


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



	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2014			2013			2014			2013
Segment profit (loss)	$	71,564		$	1,562		$	120,631		$	44,656
Less: (Provision for) recovery of loan losses	673			9,834			6,865			(5,392		)
Less: Impairment of assets(4)	(15,462		)	(6,785		)	(21,741		)	(7,181		)
Less: Stock-based compensation expense	(3,273		)	(4,563		)	(8,544		)	(14,484		)
Less: Depreciation and amortization(4)	(17,722		)	(19,019		)	(55,157		)	(53,873		)
Less: Income tax (expense) benefit(4)	(103		)	3,879			619			(688		)
Less: Loss on early extinguishment of debt, net	(186		)	(3,498		)	(24,953		)	(28,282		)
Net income (loss)	$	35,491		$	(18,590	)	$	17,720		$	(65,244	)


(4)	For the three and nine months ended September 30, 2013, excludes certain amounts reclassified to discontinued operations on the Company's Consolidated Statements of Operations.


(5)	For the three and nine months ended September 30, 2013, includes related amounts reclassified to discontinued operations on the Company's Consolidated Statements of Operations.