XML 44 R9.htm IDEA: XBRL DOCUMENT v2.4.0.8
Significant Acquisitions
 6 Months Ended
Jun. 30, 2013
Significant Acquisitions  
Significant Acquisitions

3.     Significant Acquisitions

 

On May 22, 2013, the Company acquired a property in Colorado with approximately 680,277 rentable square feet at a purchase price of approximately $183 million excluding closing costs and adjustments.  The Company expensed acquisition costs of approximately $110,000 related to this acquisition.

 

The purchase price of the property was allocated to real estate investments and leases, including lease origination costs.  Lease origination costs represent the value associated with acquiring an in-place lease (i.e. the market cost to execute a similar lease, including leasing commission, legal, vacancy, and other related costs).  The value assigned to buildings approximates their replacement cost; the value assigned to land approximates its appraised value; and the value assigned to leases approximates their fair value.  Other assets and liabilities are recorded at their historical costs, which approximates fair value.

 

The following table summarizes the estimated fair value of the assets acquired at the date of acquisition:

 

 

Real estate assets

 

$

154,060

 

Value of acquired real estate leases

 

31,024

 

Acquired unfavorable leases

 

(2,920)

 

 

 

 

 

Total

 

$

182,164

 

 

The Company assessed the fair value of the acquired real estate leases based on estimated cash flow projections that utilize appropriate discount rates and available market information. Such inputs are Level 3 in the fair value hierarchy.

 

Pro forma operating results for the Company and the acquisition are shown in the following table.  The results assume that the property was acquired on January 1, 2012.  The results are not necessarily indicative of what the Company’s actual results of operations would have been for the periods indicated, nor do they purport to represent the results of operations of any future periods.

 

 

 

For the Three Months Ended

 

For the Six Months Ended

 

(unaudited)

 

June 30,

 

June 30,

 

 

 

 

 

 

 

 

 

 

 

(in thousands except per share amounts)

 

2013

 

2012

 

2013

 

2012

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

50,780

 

$

42,978

 

$

100,482

 

$

86,255

 

Income from continuing operations

 

$

4,273

 

$

5,101

 

$

8,367

 

$

10,555

 

Net income

 

$

4,273

 

$

4,833

 

$

8,367

 

$

9,970

 

Weighted average shares outstanding

 

91,847

 

82,937

 

87,417

 

82,937

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations per share

 

$

0.05

 

$

0.06

 

$

0.10

 

$

0.13

 

Net income per share

 

$

0.05

 

$

0.06

 

$

0.10

 

$

0.12

 

 

During the six months ended June 30, 2013, the Company recognized approximately $2.2 million of revenues and $0.1 million of  net income from operations of this acquisition.

 

On July 1, 2013, the Company acquired an office property with approximately 621,007 rentable square feet for $157.9 million located in the midtown submarket of Atlanta, Georgia.  The pro forma operating results and the estimated fair value of the assets and liabilities acquired in this acquisition are not available at this time because the Company is in the process of determining such amounts.