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CONTINGENCIES | 12 Months Ended
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Dec. 31, 2015
Commitments and Contingencies Disclosure [Abstract] |
CONTINGENCIES | CONTINGENCIES Litigation The Company is currently involved in certain litigation that arises in the ordinary course of business, most of which is expected to be covered by liability insurance. Management makes assumptions and estimates concerning the likelihood and amount of any potential loss relating to these matters using the latest information available. The Company records a liability for litigation if an unfavorable outcome is probable and the amount of loss or range of loss can be reasonably estimated. If an unfavorable outcome is probable and a reasonable estimate of the loss is a range, the Company accrues the best estimate within the range. If no amount within the range is a better estimate than any other amount, the Company accrues the minimum amount within the range. If an unfavorable outcome is probable but the amount of the loss cannot be reasonably estimated, the Company discloses the nature of the litigation and indicates that an estimate of the loss or range of loss cannot be made. If an unfavorable outcome is reasonably possible and the estimated loss is material, the Company discloses the nature and estimate of the possible loss of the litigation. The Company does not disclose information with respect to litigation where an unfavorable outcome is considered to be remote or where the estimated loss would not be material. Based on current expectations, such matters, both individually and in the aggregate, are not expected to have a material adverse effect on the liquidity, results of operations, business or financial condition of the Company. In January 2015, The Promenade D'Ilberville, LLC ("TPD"), a subsidiary of the Company, received a final settlement of $4,875 from EMJ related to the litigation described in Note 14 of our Annual Report on Form 10-K for the year ended December 31, 2014. We provided disclosure of this litigation due to the related party relationship between us and EMJ. Litigation with the other remaining defendants in the matter is not expected to be material. There have been no other material developments during the year ended December 31, 2015 related to this litigation. In the fourth quarter of 2014, TPD agreed to a resolution of its claims against defendant EMJ. Pursuant to this agreement, TPD received partial settlements aggregating to $5,970 in the fourth quarter of 2014 from EMJ. TPD also received partial settlements of $800 in the first quarter of 2014 and $8,240 in the third quarter of 2013 from certain of the defendants. Certain executive officers of the Company and members of the immediate family of Charles B. Lebovitz, Chairman of the Board of the Company, collectively had a significant noncontrolling interest in EMJ, a major national construction company that the Company engaged to build a substantial number of the Company's Properties. This noncontrolling interest was sold in the third quarter of 2015. See Note 13 for additional information. EMJ was one of the defendants in the cases described above. Environmental Contingencies The Company evaluates potential loss contingencies related to environmental matters using the same criteria described above related to litigation matters. Based on current information, an unfavorable outcome concerning such environmental matters, both individually and in the aggregate, is considered to be reasonably possible. However, the Company believes its maximum potential exposure to loss would not be material to its results of operations or financial condition. The Company has a master insurance policy that provides coverage through 2022 for certain environmental claims up to $10,000 per occurrence and up to $50,000 in the aggregate, subject to deductibles and certain exclusions. Guarantees The Company may guarantee the debt of a joint venture primarily because it allows the joint venture to obtain funding at a lower cost than could be obtained otherwise. This results in a higher return for the joint venture on its investment, and a higher return on the Company’s investment in the joint venture. The Company may receive a fee from the joint venture for providing the guaranty. Additionally, when the Company issues a guaranty, the terms of the joint venture agreement typically provide that the Company may receive indemnification from the joint venture or have the ability to increase its ownership interest. The guarantees expire upon repayment of the debt, unless noted otherwise. The following table represents the Operating Partnership's guarantees of unconsolidated affiliates' debt as reflected in the accompanying consolidated balance sheets as of December 31, 2015 and 2014:
|  | As of December 31, 2015 |  | Obligation recorded to reflect guaranty
Unconsolidated Affiliate |  | Company's Ownership Interest |  | Outstanding Balance |  | Percentage Guaranteed by the Company |  | Maximum Guaranteed Amount |  | Debt Maturity Date (1) |  | 12/31/15 |  | 12/31/14
West Melbourne I, LLC - Phase I |  | 50% |  | $ | 39,475 |  |  | 25% |  | $ | 9,869 |  |  | Feb-2016 | (2) | $ | 99 |  |  | $ | 101 |
West Melbourne I, LLC - Phase II |  | 50% |  | 16,757 |  |  | 25% | (3) | 4,189 |  |  | Feb-2016 | (2) | 87 |  |  | 87 |
Port Orange I, LLC |  | 50% |  | 58,820 |  |  | 25% |  | 14,705 |  |  | Feb-2016 | (2) | 148 |  |  | 153 |
JG Gulf Coast Town Center LLC - Phase III |  | 50% |  | 5,092 |  |  | —% | (4) | — |  |  | Jul-2017 |  | — |  |  | — |
Fremaux Town Center JV, LLC - Phase I |  | 65% |  | 40,530 |  |  | 15% | (5) | 6,207 |  |  | Aug-2016 | (6) | 62 |  |  | 236 |
Fremaux Town Center JV, LLC - Phase II |  | 65% |  | 27,404 |  |  | 50% | (7) | 16,050 |  |  | Aug-2016 | (6) | 161 |  |  | 161 |
Ambassador Town Center JV, LLC |  | 65% |  | 21,418 |  |  | 100% | (8) | 45,307 |  |  | Dec-2017 | (9) | 462 |  |  | 482 |
Ambassador Infrastructure, LLC |  | 65% |  | 8,629 |  |  | 100% | (10) | 11,700 |  |  | Dec-2017 | (9) | 177 |  |  | 177 |
|  |  |  |  |  | Total guaranty liability |  | $ | 1,196 |  |  | $ | 1,397 |
(1) | Excludes any extension options.
(2) | Subsequent to December 31, 2015, the loan was modified and extended to February 2018 with a one-year extension option. See Note 19 for more information.
(3) | The guaranty was reduced to 25% in the fourth quarter of 2015 as Academy Sports is operational and paying contractual rent.
(4) | The guaranty was removed when the loan was refinanced in the third quarter of 2015. See Note 5 for more information.
(5) | The Company received a 1% fee for this guaranty when the loan was issued in March 2013. In the second quarter of 2015, the guaranty was reduced to 15% as the requirement for being open for one year was met, LA Fitness opened and began paying contractual rent and a debt service coverage ratio of 1.30 to 1.00 was achieved.
(6) | The loan has two one-year extension options, which are at the unconsolidated affiliate's election, for an outside maturity date of August 2018.
(7) | The Company received a 1% fee for this guaranty when the loan was issued in August 2014. Upon completion of Phase II of the development and once certain leasing and occupancy metrics have been met, the guaranty will be reduced to 25%. The guaranty will be further reduced to 15% when Phase II of the development has been open for one year, the debt service coverage ratio of 1.30 to 1.00 is met and Dillard's is operational.
(8) | The Company received a 1% fee for this guaranty when the loan was issued in December 2014. Once construction is complete the guaranty will be reduced to 50%. The guaranty will be further reduced from 50% to 15% once the construction of Ambassador Town Center and its related infrastructure improvements is complete as well as upon the attainment of certain debt service and operational metrics.
(9) | The loan has two one-year extension options, which are the joint venture's election, for an outside maturity date of December 2019.
(10) | The Company received a 1% fee for this guaranty when the loan was issued in December 2014. The guaranty will be reduced to 50% on March 1st of such year as PILOT payments received and attributed to the prior calendar year by Ambassador Infrastructure and delivered to the lender are $1,200 or more, provided no event of default exists. The guaranty will be reduced to 20% when the PILOT payments are $1,400 or more, provided no event of default exists.
The Company has guaranteed the lease performance of YTC, an unconsolidated affiliate in which it owns a 50% interest, under the terms of an agreement with a third party that owns property as part of York Town Center. Under the terms of that agreement, YTC is obligated to cause performance of the third party’s obligations as landlord under its lease with its sole tenant, including, but not limited to, provisions such as co-tenancy and exclusivity requirements. Should YTC fail to cause performance, then the tenant under the third party landlord’s lease may pursue certain remedies ranging from rights to terminate its lease to receiving reductions in rent. The Company has guaranteed YTC’s performance under this agreement up to a maximum of $21,200, which decreases by $800 annually until the guaranteed amount is reduced to $10,000. The guaranty expires on December 31, 2020. The maximum guaranteed obligation was $14,800 as of December 31, 2015. The Company entered into an agreement with its joint venture partner under which the joint venture partner has agreed to reimburse the Company 50% of any amounts it is obligated to fund under the guaranty. The Company did not record an obligation for this guaranty because it determined that the fair value of the guaranty was not material as of December 31, 2015 and 2014. Performance Bonds The Company has issued various bonds that it would have to satisfy in the event of non-performance. The total amount outstanding on these bonds was $16,452 and $20,720 at December 31, 2015 and 2014, respectively. Ground Leases The Company is the lessee of land at certain of its Properties under long-term operating leases, which include scheduled increases in minimum rents. The Company recognizes these scheduled rent increases on a straight-line basis over the initial lease terms. Most leases have initial terms of at least 20 years and contain one or more renewal options, generally for a minimum of 5- or 10-year periods. Lease expense recognized in the consolidated statements of operations for 2015, 2014 and 2013 was $1,215, $1,290 and $1,371, respectively. The future obligations under these operating leases at December 31, 2015, are as follows:
2016 |  | $ | 877 |
2017 |  | 885 |
2018 |  | 894 |
2019 |  | 903 |
2020 |  | 913 |
Thereafter |  | 26,814 |
|  | $ | 31,286 |

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