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OPERATING SEGMENTS
 6 Months Ended
Jun. 30, 2012
OPERATING SEGMENTS  
OPERATING SEGMENTS

NOTE 8. OPERATING SEGMENTS

 

Our segments are based on our method of internal reporting which classifies our operations by property type.  Our property types are grouped into commercial, apartments, hotels, land and other operating segments.  Significant differences among the accounting policies of the operating segments as compared to the consolidated financial statements principally involve the calculation and allocation of administrative and other expenses.  Management evaluates the performance of each of the operating segments and allocates resources to them based on their net operating income and cash flow.

 

Items of income that are not reflected in the segments are interest, other income, gain on debt extinguishment, gain on condemnation award, equity in partnerships, and gains on sale of real estate. Expenses that are not reflected in the segments are provision for losses, advisory, net income and incentive fees, general and administrative, non-controlling interests and net loss from discontinued operations before gains on sale of real estate.

 

Presented below is our reportable segments’ operating income for the three and six months ended June 30, 2012 and 2011, including segment assets and expenditures (dollars in thousands):

 

For the Three Months Ended June 30, 2012

 

Properties

 

 

Apartments

 

 

Hotels

 

 

Land

 

 

Other

 

 

Total

 

Operating revenue

 

$

9,755

 

 

$

21,227

 

 

$

-

 

 

$

-

 

 

$

34

 

 

$

31,016

 

Operating expenses

 

 

5,238

 

 

 

10,256

 

 

 

-

 

 

 

279

 

 

 

(99

)

 

 

15,674

 

Depreciation and amortization

 

 

1,612

 

 

 

3,850

 

 

 

-

 

 

 

-

 

 

 

(69

)

 

 

5,393

 

Mortgage and loan interest

 

 

801

 

 

 

12,254

 

 

 

-

 

 

 

1,573

 

 

 

2,013

 

 

 

16,641

 

Interest income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,723

 

 

 

4,723

 

Gain on land sales

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,738

 

 

 

-

 

 

 

4,738

 

Segment operating income (loss)

 

$

2,104

 

 

$

(5,133

)

 

$

-

 

 

$

2,886

 

 

$

2,912

 

 

$

2,769

 

Capital expenditures

 

 

431

 

 

 

37

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

468

 

Assets

 

 

166,902

 

 

 

561,711

 

 

 

-

 

 

 

231,497

 

 

 

-

 

 

 

960,110

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales price

 

$

6,825

 

 

$

25,985

 

 

$

3,369

 

 

$

12,650

 

 

$

-

 

 

$

48,829

 

Cost of sales

 

 

7,313

 

 

 

23,946

 

 

 

252

 

 

 

7,912

 

 

 

-

 

 

 

39,423

 

Gain (loss) on sales

 

$

(488

)

 

$

2,039

 

 

$

3,117

 

 

$

4,738

 

 

$

-

 

 

$

9,406

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended June 30, 2011

 

Properties

 

 

Apartments

 

 

Hotels

 

 

Land

 

 

Other

 

 

Total

 

Operating revenue

 

$

11,103

 

 

$

18,025

 

 

$

-

 

 

$

200

 

 

$

(22

)

 

$

29,306

 

Operating expenses

 

 

5,260

 

 

 

9,359

 

 

 

-

 

 

 

551

 

 

 

237

 

 

 

15,407

 

Depreciation and amortization

 

 

1,713

 

 

 

3,330

 

 

 

-

 

 

 

-

 

 

 

(85

)

 

 

4,958

 

Mortgage and loan interest

 

 

2,260

 

 

 

7,979

 

 

 

-

 

 

 

2,786

 

 

 

2,414

 

 

 

15,439

 

Interest income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,203

 

 

 

1,203

 

Gain on land sales

 

 

-

 

 

 

-

 

 

 

-

 

 

 

14,029

 

 

 

 

 

 

 

14,029

 

Segment operating income (loss)

 

$

1,870

 

 

$

(2,643

)

 

$

-

 

 

$

10,892

 

 

$

(1,385

)

 

$

8,734

 

Capital expenditures

 

 

5

 

 

 

82

 

 

 

-

 

 

 

8,924

 

 

 

16

 

 

 

9,027

 

Assets

 

 

177,298

 

 

 

555,522

 

 

 

-

 

 

 

337,317

 

 

 

-

 

 

 

1,070,137

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales price

 

$

67,397

 

 

$

-

 

 

$

2,525

 

 

$

60,377

 

 

$

-

 

 

$

130,299

 

Cost of sales

 

 

75,274

 

 

 

-

 

 

 

(1,114

)

 

 

49,338

 

 

 

-

 

 

 

123,498

 

Recognized prior deferred gain

 

 

-

 

 

 

963

 

 

 

-

 

 

 

2,990

 

 

 

10,954

 

 

 

14,907

 

Gain (loss) on sales

 

$

(7,877

)

 

$

963

 

 

$

3,639

 

 

$

14,029

 

 

$

10,954

 

 

$

21,708

 

 

The table below reconciles the segment information to the corresponding amounts in the Consolidated Statements of Operations:

 

 

 

For Three Months Ended June 30,

 

 

 

2012

 

 

2011

 

Segment operating income

 

$

2,769

 

 

$

8,734

 

Other non-segment items of income (expense)

 

 

 

 

 

 

 

 

General and administrative

 

 

(935

)

 

 

(3,692

)

Advisory fees

 

 

(2,700

)

 

 

(3,462

)

Provision on impairment of notes receivable and real estate assets

 

 

-

 

 

 

(444

)

Other income

 

 

2,171

 

 

 

551

 

Equity in earnings of investees

 

 

33

 

 

 

22

 

Income tax benefit

 

 

1,537

 

 

 

1,942

 

Income from continuing operations

 

$

2,875

 

 

$

3,651

 

 

The table below reconciles the segment information to the corresponding amounts in the Consolidated Balance Sheets:

 

 

 

June 30,

 

 

 

2012

 

 

2011

 

Segment assets

 

$

960,110

 

 

$

1,070,137

 

Investments in real estate partnerships

 

 

7,437

 

 

 

12,138

 

Other assets and receivables

 

 

190,369

 

 

 

186,456

 

Assets held for sale

 

 

2,329

 

 

 

132,620

 

Total assets

 

$

1,160,245

 

 

$

1,401,351

 

 

 

 

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Six Months Ended June 30, 2012

 

Properties

 

 

Apartments

 

 

Hotels

 

 

Land

 

 

Other

 

 

Total

 

Operating revenue

 

$

18,760

 

 

$

41,763

 

 

$

-

 

 

$

-

 

 

$

75

 

 

$

60,598

 

Operating expenses

 

 

10,269

 

 

 

19,970

 

 

 

-

 

 

 

558

 

 

 

290

 

 

 

31,087

 

Depreciation and amortization

 

 

3,223

 

 

 

7,736

 

 

 

-

 

 

 

-

 

 

 

(138

)

 

 

10,821

 

Mortgage and loan interest

 

 

3,701

 

 

 

23,175

 

 

 

-

 

 

 

3,277

 

 

 

4,066

 

 

 

34,219

 

Interest income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

8,063

 

 

 

8,063

 

Gain on land sales

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,716

 

 

 

-

 

 

 

3,716

 

Segment operating income (loss)

 

$

1,567

 

 

$

(9,118

)

 

$

-

 

 

$

(119

)

 

$

3,920

 

 

$

(3,750

)

Capital expenditures

 

 

877

 

 

 

235

 

 

 

-

 

 

 

285

 

 

 

-

 

 

 

1,397

 

Assets

 

 

166,902

 

 

 

561,711

 

 

 

-

 

 

 

231,497

 

 

 

-

 

 

 

960,110

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales price

 

$

6,825

 

 

$

45,610

 

 

$

3,369

 

 

$

20,914

 

 

$

-

 

 

$

76,718

 

Cost of sales

 

 

7,313

 

 

 

39,983

 

 

 

252

 

 

 

17,198

 

 

 

-

 

 

 

64,746

 

Gain (loss) on sales

 

$

(488

)

 

$

5,627

 

 

$

3,117

 

 

$

3,716

 

 

$

-

 

 

$

11,972

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Six Months Ended June 30, 2011

 

Properties

 

 

Apartments

 

 

Hotels

 

 

Land

 

 

Other

 

 

Total

 

Operating revenue

 

$

20,201

 

 

$

35,824

 

 

$

-

 

 

$

469

 

 

$

(14

)

 

$

56,480

 

Operating expenses

 

 

10,922

 

 

 

18,331

 

 

 

-

 

 

 

1,128

 

 

 

286

 

 

 

30,667

 

Depreciation and amortization

 

 

3,630

 

 

 

6,706

 

 

 

-

 

 

 

-

 

 

 

(174

)

 

 

10,162

 

Mortgage and loan interest

 

 

4,608

 

 

 

14,724

 

 

 

-

 

 

 

6,586

 

 

 

3,979

 

 

 

29,897

 

Interest income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,871

 

 

 

1,871

 

Gain on land sales

 

 

-

 

 

 

-

 

 

 

-

 

 

 

19,373

 

 

 

-

 

 

 

19,373

 

Segment operating income (loss)

 

$

1,041

 

 

$

(3,937

)

 

$

-

 

 

$

12,128

 

 

$

(2,234

)

 

$

6,998

 

Capital expenditures

 

 

59,392

 

 

 

11,003

 

 

 

-

 

 

 

8,259

 

 

 

-

 

 

 

78,654

 

Assets

 

 

177,298

 

 

 

555,522

 

 

 

-

 

 

 

337,317

 

 

 

-

 

 

 

1,070,137

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales price

 

$

109,411

 

 

$

-

 

 

$

2,525

 

 

$

110,909

 

 

$

-

 

 

$

222,845

 

Cost of sales

 

 

117,002

 

 

 

-

 

 

 

(1,114

)

 

 

95,777

 

 

 

-

 

 

 

211,665

 

Recognized prior deferred gain

 

 

3,851

 

 

 

963

 

 

 

-

 

 

 

4,241

 

 

 

10,954

 

 

 

20,009

 

Gain (loss) on sales

 

$

(3,740

)

 

$

963

 

 

$

3,639

 

 

$

19,373

 

 

$

10,954

 

 

$

31,189

 

 

The table below reconciles the segment information to the corresponding amounts in the Consolidated Statement of Operations:

 

 

 

For Six Months Ended June 30,

 

 

 

2012

 

 

2011

 

Segment operating income (loss)

 

$

(3,750

)

 

$

6,998

 

General and administrative

 

 

(3,507

)

 

 

(6,915

)

Advisory fees

 

 

(5,359

)

 

 

(6,984

)

Provision on impairment of notes receivable and real estate assets

 

 

-

 

 

 

(5,622

)

Other income

 

 

3,800

 

 

 

1,765

 

Equity in earnings of investees

 

 

150

 

 

 

(73

)

Loss on sale of investment

 

 

(362

)

 

 

-

 

Income tax benefit

 

 

2,548

 

 

 

2,351

 

Loss from continuing operations

 

$

(6,480

)

 

$

(8,480

)

 

The table below reconciles the segment information to the corresponding amounts in the Consolidated Balance Sheets:

 

 

 

June 30,

 

 

 

2012

 

 

2011

 

Segment assets

 

$

960,110

 

 

$

1,070,137

 

Investments in real estate partnerships

 

 

7,437

 

 

 

12,138

 

Other assets

 

 

190,369

 

 

 

186,456

 

Assets held for sale

 

 

2,329

 

 

 

132,620

 

Total assets

 

$

1,160,245

 

 

$

1,401,351