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Impairment Charges | 9 Months Ended
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Sep. 30, 2021
Asset Impairment Charges [Abstract] |
Impairment Charges |
1 1. | Impairment Charges
For the nine months ended September 30, 2021, the Company recorded impairment charges of $7.3 million, based on the difference between the carrying value of the assets or investments and the estimated fair market value. In 2021, the impairment charges recorded were triggered by a change in the hold period assumptions for an asset considered for sale and sold in the first quarter. For the three and nine months ended September 30, 2020, the Company recorded an adjustment to the reserve of $3.5 million and net charges of $19.4 million, respectively, as a result of an aggregate valuation allowance on its preferred equity interests in the BRE DDR j oint v entures that were t ransferred or redeemed in the fourth quarter of 2020. Items Measured at Fair Value The Company is required to assess the fair value of certain impaired consolidated and unconsolidated joint venture investments. The valuation of impaired real estate assets and investments is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each asset, as well as the income capitalization approach considering prevailing market capitalization rates, analysis of recent comparable sales transactions, actual sales negotiations and bona fide purchase offers received from third parties and/or consideration of the amount that currently would be required to replace the asset, as adjusted for obsolescence. In general, the Company considers multiple valuation techniques when measuring fair value of an investment. However, in certain circumstances, a single valuation technique may be appropriate. For operational real estate assets, the significant valuation assumptions included the capitalization rate used in the income capitalization valuation, as well as the projected property net operating income and expected hold period. For projects under development or not at stabilization, the significant assumptions included the discount rate, the timing and the estimated costs for the construction completion and project stabilization, projected net operating income and the exit capitalization rate. These valuations were calculated based on market conditions and assumptions made by management at the time the valuation adjustments and impairments were recorded, which may differ materially from actual results if market conditions or the underlying assumptions change. The following table presents information about the fair value of real estate that was impaired, and therefore, measured on a fair value basis, along with the related impairment charge, for the nine months ended September 30, 2021. The table also indicates the fair value hierarchy of the valuation techniques used by the Company to determine such fair value (in millions):
|  | Fair Value Measurements |
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |  |  | Total Impairment Charges |
September 30, 2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Long-lived assets held and used |  | $ | — |  |  | $ | — |  |  | $ | 10.0 |  |  | $ | 10.0 |  |  | $ | 7.3 |
The following table presents quantitative information about the significant unobservable inputs used by the Company to determine the fair value (in millions):
|  | Quantitative Information about Level 3 Fair Value Measurements
|  | Fair Value at |  |  | Valuation |  |  |  |  |  | Weighted
Description |  | September 30, 2021 |  |  | Technique |  | Unobservable Inputs |  | Range |  | Average
Impairment of consolidated assets |  | $ | 10.0 |  |  | Indicative Bid(A) |  | Indicative Bid(A) |  | N/A |  | N/A
(A) | Fair value measurement based upon an indicative bid and developed by third-party sources (including offers and comparable sales values), subject to the Company’s corroboration for reasonableness. The Company does not have access to certain unobservable inputs used by third parties to determine these estimated fair values.

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- Definition The entire disclosure for the details of the charge against earnings resulting from the aggregate write down of all assets from their carrying value to their fair value. Disclosure may also include a description of the impaired asset and facts and circumstances leading to the impairment, amount of the impairment loss and where the loss is located in the income statement, method(s) for determining fair value, and the segment in which the impaired asset is reported. + References No definition available. + Details
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