INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES

9 Months Ended

Sep. 30, 2025

Equity Method Investments and Joint Ventures [Abstract]

INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES

4. INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES

As of September 30, 2025, the Company held ownership interests in nine unconsolidated real estate ventures, with a net aggregate investment balance of $594.2 million. As of September 30, 2025, four of the real estate ventures owned properties (directly or through leasehold interests) that contained an aggregate of approximately 4.1 million net rentable square feet of office space; one of the real estate ventures directly owns one property with 341 rentable residential units; one of the real estate ventures directly owns a mixed use building featuring 0.2 million square feet of office space and 326 rentable residential units; two of the real estate ventures owned 1.4 acres of land held for development; and one of the real estate ventures owned land in active development.

The Company accounts for its interests in the unconsolidated real estate ventures, which range, as of September 30, 2025, from 20% to 85%, using the equity method accounting. Certain of the unconsolidated real estate ventures are subject to specified priority allocations of distributable cash, including cash from operations and cash from capital events, such as sales of properties.

The Company earned management fees from the unconsolidated real estate ventures of $1.2 million and $2.2 million for the three months ended September 30, 2025 and 2024, respectively, and $3.8 million and $5.9 million for the nine months ended September 30, 2025 and 2024, respectively.

The Company earned leasing commissions from the unconsolidated real estate ventures of $0.8 million and $0.2 million for the three months ended September 30, 2025 and 2024, respectively, and $2.9 million and $1.7 million for the nine months ended September 30, 2025 and 2024, respectively.

The Company had outstanding accounts receivable balances from the unconsolidated real estate ventures of $5.9 million and $5.0 million as of September 30, 2025 and December 31, 2024, respectively.

The amounts reflected in the following tables (except for the Company’s share of equity in income) are based on the financial information of the individual unconsolidated real estate ventures.

The following is a summary of the financial position of the unconsolidated real estate ventures in which the Company held interests as of September 30, 2025 and December 31, 2024 (in thousands):


	September 30, 2025		December 31, 2024
Net property	$	1,653,934	$	1,641,085
Other assets	246,037		238,406
Other liabilities	100,813		107,801
Debt, net	760,249		752,325
Equity (a)	1,038,909		1,019,365

(a)This amount does not include the effect of the basis difference between the Company’s historical cost basis and the basis recorded at the real estate venture level, which is typically amortized over the life of the related assets and liabilities. Basis differentials occur from the impairment of investments, purchases of third-party interests in existing real estate ventures and upon the transfer of assets that were previously owned by the Company into a real estate venture. In addition, certain acquisition, transaction and other costs may not be reflected in the net assets at the real estate venture level.

The following is a summary of results of operations of the unconsolidated real estate ventures in which the Company held interests during the three and nine-month periods ended September 30, 2025 and 2024 (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025 (a)		2024
Revenue	$	36,980	$	33,058	$	118,262	$	122,951
Operating expenses	(18,222)		(13,680)		(51,179)		(63,985)
Interest expense, net	(15,722)		(12,030)		(45,417)		(44,980)
Depreciation and amortization	(17,216)		(14,518)		(49,486)		(54,499)

Loss on property disposition	—		490		(474)		—
Provision for impairment	—		(116,543)		—		(116,543)

Net loss	$	(14,180)	$	(123,223)	$	(28,294)	$	(157,056)
Ownership interest %	Various		Various		Various		Various
Company's share of net loss	$	(18,281)	$	(119,111)	$	(43,821)	$	(146,992)
Other-than-temporary impairment	—		(6,833)		—		(6,833)
Basis adjustments and other	98		82		295		(132)
Equity in loss of unconsolidated real estate ventures	$	(18,183)	$	(125,862)	$	(43,526)	$	(153,957)

(a)Excludes amounts related to the Herndon Innovation Center Metro Portfolio Venture, LLC and the New MAP Venture as the Company discontinued applying the equity method of accounting. The Company discontinued applying the equity method of accounting on the Herndon Innovation Center Metro Portfolio Venture, LLC after March 31, 2024 and had no further investments in Herndon Innovation Center as of December 31, 2024. As of June 30, 2024, the Company's investment in the New MAP Venture was zero.

3025 JFK Venture

On October 22, 2025, the Company acquired all of its partner's preferred equity interest in the 3025 JFK Boulevard Venture ("3025 JFK"), located in Philadelphia, Pennsylvania for $70.5 million. As a result of the acquisition of the preferred equity interest, 3025 JFK is a wholly owned asset that will be consolidated in our fourth quarter results, and the Company assumed the existing $178.0 million secured construction loan that matures in July 2026.