Earnings per Common Share

Basic earnings per common share is calculated by dividing net income attributable to common shareholders by the weighted-average number of common shares outstanding during the period excluding the weighted average number of unvested restricted shares outstanding during the period. Diluted earnings per common share is calculated by dividing net income attributable to common shareholders by the weighted average number of common shares outstanding during the period, plus any shares that could potentially be outstanding during the period. Potential shares consist of unvested restricted share grants and unvested performance units, calculated using the treasury stock method. Any anti-dilutive shares have been excluded from the diluted earnings per share calculation.

Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating shares and are considered in the computation of earnings per share pursuant to the two-class method. If there were any undistributed earnings allocable to participating shares, they would be deducted from net income attributable to common shareholders utilized in the basic and diluted earnings per share calculations.

For the three and nine months ended September 30, 2013, approximately $0.1 million and $0.1 million, respectively, represented undistributed earnings that were allocable to participating shares. For the three and nine months ended September 30, 2012, no earnings representing undistributed earnings were allocated to participating shares because the Company paid dividends in excess of net income.

The limited partners’ outstanding limited partnership units in the Operating Partnership (which may be redeemed for common shares of beneficial interest under certain circumstances) have been excluded from the diluted earnings per share calculation as there was no effect on the amounts for the three and nine months ended September 30, 2013 and 2012, since the limited partners’ share of income would also be added back to net income attributable to common shareholders.

The computation of basic and diluted earnings per common share is as follows (in thousands, except share and per share data):



	For the three months ended September 30,						For the nine months ended September 30,
	2013			2012			2013			2012
Numerator:
Net income attributable to common shareholders before discontinued operations	$	33,290		$	15,917		$	80,089		$	28,568
Add: Income (loss) from discontinued operations	3,179			(721		)	5,387			(1,000		)
Net income attributable to common shareholders	36,469			15,196			85,476			27,568
Less: Dividends paid on unvested restricted shares	(216		)	(183		)	(712		)	(594		)
Less: Undistributed earnings attributable to unvested restricted shares	(97		)	—			(86		)	—
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares	$	36,156		$	15,013		$	84,678		$	26,974
Denominator:
Weighted-average number of common shares - basic	121,594,219			105,453,978			116,697,417			105,392,071
Unvested restricted shares	249,029			55,126			212,672			54,140
Unvested performance units	906,873			—			887,581			—
Weighted-average number of common shares - diluted	122,750,121			105,509,104			117,797,670			105,446,211

Net income per share attributable to common shareholders before discontinued operations - basic	$	0.27		$	0.15		$	0.68		$	0.27
Discontinued operations	0.03			(0.01		)	0.05			(0.01		)
Net income per share attributable to common shareholders - basic	$	0.30		$	0.14		$	0.73		$	0.26

Net income per share attributable to common shareholders before discontinued operations - diluted	$	0.27		$	0.15		$	0.67		$	0.27
Discontinued operations	0.03			(0.01		)	0.05			(0.01		)
Net income per share attributable to common shareholders - diluted	$	0.30		$	0.14		$	0.72		$	0.26