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Unconsolidated Affiliates and Cost Method Investments | 12 Months Ended
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Dec. 31, 2013
Equity Method Investments and Joint Ventures [Abstract] |
Unconsolidated Affiliates, Noncontrolling Interests, and Cost Method Investments | UNCONSOLIDATED AFFILIATES AND COST METHOD INVESTMENTS Unconsolidated Affiliates At December 31, 2013, the Company had investments in the following 17 entities, which are accounted for using the equity method of accounting:
Joint Venture |  | Property Name |  | Company's Interest
CBL/T-C, LLC |  | CoolSprings Galleria, Oak Park Mall, West County Center and Pearland Town Center |  | 60.3 | %
CBL-TRS Joint Venture, LLC |  | Friendly Center, The Shops at Friendly Center and a portfolio of four office buildings |  | 50.0 | %
CBL-TRS Joint Venture II, LLC |  | Renaissance Center |  | 50.0 | %
El Paso Outlet Outparcels, LLC |  | The Outlet Shoppes at El Paso (vacant land) |  | 50.0 | %
Fremaux Town Center JV, LLC |  | Fremaux Town Center |  | 65.0 | %
Governor’s Square IB |  | Governor’s Plaza |  | 50.0 | %
Governor’s Square Company |  | Governor’s Square |  | 47.5 | %
High Pointe Commons, LP |  | High Pointe Commons |  | 50.0 | %
High Pointe Commons II-HAP, LP |  | High Pointe Commons - Christmas Tree Shop |  | 50.0 | %
JG Gulf Coast Town Center LLC |  | Gulf Coast Town Center |  | 50.0 | %
Kentucky Oaks Mall Company |  | Kentucky Oaks Mall |  | 50.0 | %
Mall of South Carolina L.P. |  | Coastal Grand—Myrtle Beach |  | 50.0 | %
Mall of South Carolina Outparcel L.P. |  | Coastal Grand—Myrtle Beach (Coastal Grand Crossing and vacant land) |  | 50.0 | %
Port Orange I, LLC |  | The Pavilion at Port Orange Phase I and one office building |  | 50.0 | %
Triangle Town Member LLC |  | Triangle Town Center, Triangle Town Commons and Triangle Town Place |  | 50.0 | %
West Melbourne I, LLC |  | Hammock Landing Phases I and II |  | 50.0 | %
York Town Center, LP |  | York Town Center |  | 50.0 | %
Although the Company had majority ownership of certain joint ventures during 2013, 2012 and 2011, it evaluated the investments and concluded that the other partners or owners in these joint ventures had substantive participating rights, such as approvals of:
• | the pro forma for the development and construction of the project and any material deviations or modifications thereto;
• | the site plan and any material deviations or modifications thereto;
• | the conceptual design of the project and the initial plans and specifications for the project and any material deviations or modifications thereto;
• | any acquisition/construction loans or any permanent financings/refinancings;
• | the annual operating budgets and any material deviations or modifications thereto;
• | the initial leasing plan and leasing parameters and any material deviations or modifications thereto; and
• | any material acquisitions or dispositions with respect to the project.
As a result of the joint control over these joint ventures, the Company accounts for these investments using the equity method of accounting. Condensed combined financial statement information of these unconsolidated affiliates is as follows:
| December 31,
| 2013 |  | 2012
ASSETS: |  |  |
Investment in real estate assets | $ | 2,167,227 |  |  | $ | 2,143,187 |
Accumulated depreciation | (555,174 | ) |  | (492,864 | )
| 1,612,053 |  |  | 1,650,323 |
Developments in progress | 103,161 |  |  | 21,809 |
Net investment in real estate assets | 1,715,214 |  |  | 1,672,132 |
Other assets | 168,799 |  |  | 175,540 |
Total assets | $ | 1,884,013 |  |  | $ | 1,847,672 |
LIABILITIES: |  |  |
Mortgage and other indebtedness | $ | 1,468,422 |  |  | $ | 1,456,622 |
Other liabilities | 48,203 |  |  | 48,538 |
Total liabilities | 1,516,625 |  |  | 1,505,160 |
OWNERS' EQUITY: |  |  |
The Company | 213,664 |  |  | 196,694 |
Other investors | 153,724 |  |  | 145,818 |
Total owners' equity | 367,388 |  |  | 342,512 |
Total liabilities and owners’ equity | $ | 1,884,013 |  |  | $ | 1,847,672 |
| Year Ended December 31,
| 2013 |  | 2012 |  | 2011
Revenues | $ | 243,215 |  |  | $ | 251,628 |  |  | $ | 177,222 |
Depreciation and amortization | (76,323 | ) |  | (82,534 | ) |  | (58,538 | )
Other operating expenses | (72,166 | ) |  | (76,567 | ) |  | (53,417 | )
Income from operations | 94,726 |  |  | 92,527 |  |  | 65,267 |
Interest income | 1,359 |  |  | 1,365 |  |  | 1,420 |
Interest expense | (76,934 | ) |  | (84,421 | ) |  | (59,972 | )
Gain on sales of real estate assets | 102 |  |  | 2,063 |  |  | 1,744 |
Net income | $ | 19,253 |  |  | $ | 11,534 |  |  | $ | 8,459 |
Financings The following table presents the loan activity of the Company's unconsolidated affiliates since January 1, 2012:
Date |  | Property |  | Stated Interest Rate |  | Maturity Date (1) |  | Amount Financed or Extended
2013 Activity: |  |  |  |  |  |
December |  | The Pavilion at Port Orange - Phase I (2) |  | LIBOR + 2.0% |  | November 2015 |  | $ | 62,600 |
December |  | Hammock Landing - Phase I (3) |  | LIBOR + 2.0% |  | November 2015 |  | 41,068 |
December |  | Hammock Landing - Phase II (4) |  | LIBOR + 2.25% |  | November 2015 |  | 10,757 |
March |  | Renaissance Center - Phase II (5) |  | 3.49% |  | April 2023 |  | 16,000 |
March |  | Friendly Center (6) |  | 3.48% |  | April 2023 |  | 100,000 |
March |  | Fremaux Town Center - Phase I (7) |  | LIBOR + 2.125% |  | March 2016 |  | 46,000 |
2012 Activity: |  |  |  |  |  |
December |  | West County Center (8) |  | 3.40% |  | December 2022 |  | $ | 190,000 |
July |  | Gulf Coast Town Center - Phase III (9) |  | LIBOR + 2.5% |  | July 2015 |  | 7,000 |
February |  | York Town Center (10) |  | 4.90% |  | February 2022 |  | 38,000 |
March |  | The Pavilion at Port Orange (11) |  | LIBOR + 3.5% |  | March 2014 |  | 64,950 |
(1) Excludes any extension options.
(2) | The construction loan was extended and modified to reduce the capacity from $64,950 to $62,600, reduce the interest rate from a variable-rate of LIBOR + 3.5% to a variable-rate of LIBOR + 2.0% and extend the maturity date. The loan has two one-year extension options, which are at the joint venture's election, for an outside maturity date of November 2017. The Company has guaranteed 25% of the construction loan.
(3) | The loan was amended and restated to extend the maturity date and reduce the interest rate from a variable-rate of LIBOR + 3.5% to a variable-rate of LIBOR + 2.0%. The loan has two one-year extension options, which are at the joint venture's election, for an outside maturity date of November 2017. The Company has guaranteed 25% of the loan.
(4) | A new construction loan to build a Carmike Cinema has two one-year extension options, which are at the joint venture's election, for an outside maturity date of November 2017. Upon completion of the construction and opening of the Carmike Cinema, the Company's guaranty will be reduced from 100% to 25% and the loan will bear interest at a variable-rate of LIBOR + 2.0%.
(5) Net proceeds from the loan were used to retire a $15,700 loan that was scheduled to mature in April 2013.
(6) | Net proceeds from the loan were used to retire four loans, scheduled to mature in April 2013 and with an aggregate balance of $100,000, that were secured by Friendly Center, Friendly Center Office Building, First National Bank Building, Green Valley Office Building, First Citizens Bank Building, Wachovia Office Building and Bank of America Building.
(7) | The construction loan has two one-year extension options, which are at the joint venture's election, for an outside maturity date of March 2018. The Company has guaranteed 100% of the construction loan.
(8) | Net proceeds of $189,687 were used to retire the outstanding borrowings of $142,235 under the previous loan and excess proceeds were distributed 50/50 to the Company and its joint venture partner.
(9) | Net proceeds from the loan were distributed to the Company in accordance with the terms of the joint venture agreement and were used to reduce the outstanding balances on the Company's credit facilities. The Company has guaranteed 100% of the loan.
(10) | Net proceeds from the loan, plus cash on hand, were used to retire a $39,379 loan that was scheduled to mature in March 2012.
(11) | The construction loan was extended and modified to remove a 1% LIBOR floor and reduce the capacity from $98,883 to $64,950. The joint venture paid $3,332 to reduce the outstanding balance on the loan to the new capacity amount. There is a one-year extension option on the loan, which is at the joint venture's election, for an outside maturity date of March 2015. The Company has guaranteed 100% of the construction loan. See Note (3) above for information on the extension and modification of this loan in December 2013.
All of the debt on the Properties owned by the unconsolidated affiliates listed above is non-recourse, except for West Melbourne, Port Orange, High Pointe Commons, Gulf Coast - Phase III and Fremaux. See Note 14 for a description of guarantees the Company has issued related to certain unconsolidated affiliates. See Note 19 for a subsequent event related to the Fremaux construction loan. Fremaux Town Center JV, LLC In January 2013, the Company formed a 65/35 joint venture, Fremaux, to develop, own and operate Fremaux Town Center, a community center development located in Slidell, LA. Construction began in March 2013 on the first phase with completion expected in spring 2014. The partners contributed aggregate initial equity of $20,500, of which the Company's contribution was $18,450. Following the initial formation of Fremaux, all required future contributions will be funded on a 65/35 pro rata basis. Imperial Valley Mall L.P, Imperial Valley Peripheral L.P., Imperial Valley Commons L.P. In December 2012, the Company acquired the remaining 40.0% interests in Imperial Valley Mall L.P. and Imperial Valley Peripheral L.P., which owns vacant land adjacent to Imperial Valley Mall in El Centro, CA, from its joint venture partner. The results of operations of Imperial Valley Mall L.P. and Imperial Valley Peripheral L.P. through the acquisition date are included in the table above using the equity method of accounting. From the date of acquisition, the results of operations of Imperial Valley Mall L.P. and Imperial Valley Peripheral L.P. are accounted for on a consolidated basis. The Company also acquired the joint venture partner's 40.0% interest in Imperial Valley Commons L.P., a VIE that owns land adjacent to Imperial Valley Mall. Imperial Valley Commons L.P. was consolidated as a VIE as of December 31, 2012 and continues to be accounted for on a consolidated basis as a wholly-owned entity as of December 31, 2013. See Note 3 for further information. El Paso Outlet Outparcels, LLC In April 2012, the Company acquired a 50.0% interest in a joint venture, El Paso Outlet Outparcels, LLC, simultaneously with the acquisition of a 75.0% interest in The Outlet Shoppes at El Paso (see Note 3). The Company's investment was $3,864. The remaining 50.0% interest is owned by affiliates of Horizon Group Properties. El Paso Outlet Outparcels, LLC owns land adjacent to The Outlet Shoppes at El Paso. The terms of the joint venture agreement provide that voting rights, capital contributions and distributions of cash flows will be on a pari passu basis in accordance with the ownership percentages. CBL/T-C, LLC In October 2011, the Company entered into a joint venture, CBL/T-C with TIAA-CREF. The Company contributed its interests in CoolSprings Galleria and West County Center, as well as a partial interest in Oak Park Mall, and TIAA-CREF contributed cash of $222,242. The contributed interests were encumbered by a total of $359,334 in mortgage loans. CBL/T-C used a portion of the contributed cash to acquire Pearland Town Center and the remaining interest in Oak Park Mall from the Company for an aggregate purchase price, including transaction costs, of $381,730, consisting of $207,410 in cash and the assumption of a mortgage loan of $174,320. The Company received $5,526 of cash from CBL/T-C for reimbursement of pre-formation expenditures. The Company used $204,210 of the proceeds, net of closing costs and expenses, received from these transactions to repay outstanding borrowings on its secured lines of credit. The Company and TIAA-CREF each own a 50% interest with respect to the CoolSprings Galleria, Oak Park Mall and West County Center Properties. The terms of the joint venture agreement provide that, with respect to these Properties, voting rights, capital contributions and distributions of cash flows will be on a pari passu basis in accordance with ownership percentages. The Company and TIAA-CREF own 88% and 12% interests, respectively, in Pearland Town Center. The terms of the joint venture agreement provide that all major decisions, as defined, pertaining to Pearland Town Center require the approval of holders of 90% of the interests in Pearland Town Center and that capital contributions will be made on a pro rata basis in accordance with ownership percentages. The terms of the joint venture also provide that distributions of cash from Pearland Town Center will be made first to TIAA-CREF until it has received a preferred return equal to 8.0%, second to the Company until it has received a preferred return equal to 8.0% and then to the Company and TIAA-CREF pro rata according to ownership interests. Beginning on the second anniversary of CBL/T-C's formation, after TIAA-CREF receives its preferred return, TIAA-CREF will receive distributions until its aggregate unreturned contributions are reduced to $6,000, before any cash distributions are eligible to be made to the Company. Also beginning on the second anniversary of CBL/T-C's formation, after TIAA-CREF has received its preferred return and its unreturned contributions are reduced to $6,000, and after the Company receives its preferred return, all remaining cash distributions will be made to the Company until its aggregate unreturned contributions are reduced to $44,000. Once the Company's aggregate unreturned contributions are reduced to $44,000, all remaining distributions will be made to the Company and TIAA-CREF on a pro rata basis according to the ownership percentages. The terms of the joint venture also provide that between the second and third anniversaries of CBL/T-C's formation, the Company may elect to purchase TIAA-CREF's interest in Pearland Town Center for a purchase price equal to the greater of (i) the fair value of TIAA-CREF's interest in Pearland Town Center as determined by an appraisal or (ii) TIAA-CREF's invested capital plus a preferred return equal to 8.0%. The Company has accounted for the formation of CBL/T-C as the sale of a partial interest in the combined CoolSprings Galleria, Oak Park Mall and West County Center Properties and recognized a gain on sale of real estate of $54,327 in 2011, which included the impact of a reserve for future capital expenditures that the Company must fund related to parking decks at West County Center in the amount of $26,439. The Company recorded its investment in CBL/T-C under the equity method of accounting at $116,397, which represented its combined remaining 50% cost basis in the CoolSprings Galleria, Oak Park Mall and West County Center Properties. The Company determined that CBL/T-C's interest in Pearland Town Center represents a variable interest in such specified assets of a VIE and have accounted for the Pearland Town Center Property separately from the combined CoolSprings Galleria, Oak Park Mall and West County Center Properties discussed above. The Company determined that, because it has the option to acquire TIAA-CREF's interest in Pearland Town Center in the future, it did not qualify as a partial sale and therefore, has accounted for the $18,264 contributed by TIAA-CREF attributable to Pearland Town Center as a financing. This amount is included in mortgage and other indebtedness in the accompanying consolidated balance sheets. Under the financing method, the Company continues to account for Pearland Town Center on a consolidated basis. Cost Method Investments The Company owns a 6.2% noncontrolling interest in subsidiaries of Jinsheng Group (“Jinsheng”), an established mall operating and real estate development company located in Nanjing, China. As of December 31, 2013, Jinsheng owns controlling interests in eight home furnishing shopping malls. Prior to May 2013, the Company also held a secured convertible promissory note secured by 16,565,534 Series 2 Ordinary Shares of Jinsheng (which equated to a 2.275% ownership interest). The secured note was non-interest bearing and was amended by the Company and Jinsheng to extend to May 30, 2013 the Company's right to convert the outstanding amount of the secured note into 16,565,534 Series A-2 Preferred Shares of Jinsheng. The Company exercised its right to demand payment of the note and received payment from Jinsheng in May 2013. See Note 15 for additional information about the secured note. The Company accounts for its noncontrolling interest in Jinsheng using the cost method because the Company does not exercise significant influence over Jinsheng and there is no readily determinable market value of Jinsheng’s shares since they are not publicly traded. The noncontrolling interest and the secured note are reflected as investment in unconsolidated affiliates in the accompanying consolidated balance sheets.

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