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REVENUES

12 Months Ended

Dec. 31, 2019

Revenue From Contract With Customer [Abstract]

NOTE 3. REVENUES

Contract Balances

A summary of the Company's contract assets activity during the year ended December 31, 2019 is presented below:

	Contract Assets
Balance as of January 1, 2019	$	289
Tenant openings		( 436	)
Executed leases		431
Balance as of December 31, 2019	$	284

A summary of the Company's contract liability activity during the year ended December 31, 2019 is presented below:

	Contract Liability
Balance as of January 1, 2019	$	265
Completed performance obligation		( 107	)
Contract obligation		—
Balance as of December 31, 2019	$	158

The Company has the following contract balances as of December 31, 2019:

		As of		Expected Settlement Period
Description	Financial Statement Line Item	December 31, 2019		2020			2021			2022			2023
Contract assets ⁽¹⁾	Management, development and leasing fees	$	284	$	( 236	)	$	( 44	)	$	—		$	( 4	)
Contract liability ⁽²⁾	Other revenues		158		( 53	)		( 53	)		( 52	)		—

(1)

Represents leasing fees recognized as revenue in the period in which the lease is executed. Under third party and unconsolidated affiliates' contracts, the remaining 50% of the commissions are paid when the tenant opens. The tenant typically opens within a year, unless the project is in development.

(2)	Relates to a contract with a vendor in which the Company received advance payments in the initial years of the multi-year contracts.

Revenues

The following table presents the Company's revenues disaggregated by revenue source:

	Year Ended December 31, 2019		Year Ended December 31, 2018
Rental revenues ⁽¹⁾	$	736,878	$	829,113
Revenues from contracts with customers (ASC 606):
Operating expense reimbursements ⁽²⁾		9,783		8,434
Management, development and leasing fees ⁽³⁾		9,350		10,542
Marketing revenues ⁽⁴⁾		6,059		6,286
		25,192		25,262

Other revenues		6,626		4,182
Total revenues ⁽⁵⁾	$	768,696	$	858,557

(1)

Revenues from leases that commenced subsequent to December 31, 2018 are accounted for in accordance with ASC 842, Leases , whereas all leases existing prior to that date are accounted for in accordance with ASC 840. See Note 4 .

(2)

Includes $ 9,404 in the Malls segment and $ 379 in the All Other segment for the year ended December 31, 2019. Includes $ 5,873 in the Malls segment and $ 2,561 in the All Other segment for the year ended December 31, 2018. See description below.

(3)

Included in All Other segment.

(4)

Marketing revenues solely relate to the Malls segment for the year ended December 31, 2019. Includes $ 6,255 in the Malls segment and $ 31 in the All Other segment for the year ended December 31, 2018.

(5)

Sales taxes are excluded from revenues.

See Note 12 for information on the Company's segments.

Revenue from Contracts with Customers

Operating expense reimbursements

Under operating and other agreements with third parties, which own anchor or outparcel buildings at the Company's properties and pay no rent, the Company receives reimbursements for certain operating expenses such as ring road and parking area maintenance, landscaping and other fees. These arrangements are primarily either set at a fixed rate with rate increases typically every five years or are on a variable (pro rata) basis, typically as a percentage of costs allocated based on square footage or sales. The majority of these contracts have an initial term and one or more extension options, which cumulatively approximate 50 or more years as historically the initial term and any extension options are typically reasonably certain of being executed by the third party. The standalone selling price of each performance obligation is determined based on the terms of the contract, which typically assigns a price to each performance obligation that directly relates to the value the customer receives for the services being provided. Revenue is recognized as services are transferred to the customer. Variable consideration is based on historical experience and is generally recognized over time using the cost-to-cost method of measurement because it most accurately depicts the Company's performance in satisfying the performance obligation. The cumulative catch-up method is used to recognize any adjustments in variable consideration estimates. Under this method, any adjustment is recognized in the period it is identified.

Management, development and leasing fees

The Company earns revenue from contracts with third parties and unconsolidated affiliates for property management, leasing, development and other services. These contracts are accounted for on a month-to-month basis if the agreement does not contain substantive penalties for termination. The majority of the Company's contracts with customers

are accounted for on a month-to-month basis. The standalone selling price of each performance obligation is determined based on the terms of the contract, which typically assigns a price to each performance obligation that directly relates to the value the customer receives for the services being provided. These contracts generally are for the following:

•

Management fees - Management fees are charged as a percentage of revenues (as defined in the contract) and recognized as revenue over time as services are provided.

•

Leasing fees - Leasing fees are charged for newly executed leases and lease renewals and are recognized as revenue upon lease execution, when the performance obligation is completed. In cases for which the agreement specifies 50% of the leasing commission will be paid upon lease execution with the remainder paid when the tenant opens, the Company estimates the amount of variable consideration it expects to receive by evaluating the likelihood of tenant openings using the most likely amount method and records the amount as an unbilled receivable (contract asset).

•

Development fees - Development fees may be either set as a fixed rate in a separate agreement or be a variable rate based on a percentage of work costs. Variable consideration related to development fees is generally recognized over time using the cost-to-cost method of measurement because it most accurately depicts the Company's performance in satisfying the performance obligation. Contract estimates are based on various assumptions including the cost and availability of materials, anticipated performance and the complexity of the work to be performed. The cumulative catch-up method is used to recognize any adjustments in variable consideration estimates. Under this method, any adjustment is recognized in the period it is identified.

Development and leasing fees received from an unconsolidated affiliate are recognized as revenue only to the extent of the third-party partner’s ownership interest. The Company's share of such fees are recorded as a reduction to the Company’s investment in the unconsolidated affiliate.

Marketing revenues

The Company earns marketing revenues from advertising and sponsorship agreements. These fees may be for tangible items in which the Company provides advertising services and creates signs and other promotional materials for the tenant or may be arrangements in which the customer sponsors a play area or event and receives specified brand recognition and other benefits over a set period of time. Revenue related to advertising services is recognized as goods and services are provided to the customer. Sponsorship revenue is recognized on a straight-line basis over the time period specified in the contract.

Performance obligations

A performance obligation is a promise in a contract to transfer a distinct good or service to a customer. If the contract does not specify the revenue by performance obligation, the Company allocates the transaction price to each performance obligation based on its relative standalone selling price. Such prices are generally determined using prices charged to customers or using the Company’s expected cost plus margin. Revenue is recognized as the Company’s performance obligations are satisfied over time, as services are provided, or at a point in time, such as leasing a space to earn a commission. Open performance obligations are those in which the Company has not fully or has partially provided the applicable good or services to the customer as specified in the contract. If consideration is received in advance of the Company’s performance, including amounts which are refundable, recognition of revenue is deferred until the performance obligation is satisfied or amounts are no longer refundable.

Practical Expedients

The Company does not disclose the value of open performance obligations for (1) contracts with an original expected duration of one year or less and (2) contracts for which the Company recognizes revenue at the amount to which the Company has the right to invoice, which primarily relate to services performed for certain operating expense reimbursements and management, leasing and development activities, as described above. Performance obligations related to pro rata operating expense reimbursements for certain noncancellable contracts are disclosed below.

Outstanding Performance Obligations

The Company has outstanding performance obligations related to certain noncancellable contracts with customers for which it will receive fixed operating expense reimbursements for providing certain maintenance and other services as described above. As of December 31, 2019, the Company expects to recognize these amounts as revenue over the following periods:

Performance obligation

Less than 5

years

5-20 years

Over 20

years

Total

Fixed operating expense reimbursements

25,651

47,224

44,951

117,826

The Company evaluates its performance obligations each period and makes adjustments to reflect any known additions or cancellations. Performance obligations related to variable consideration, which is based on sales, are constrained.