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Real Estate | 12 Months Ended
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Dec. 31, 2021
Real Estate [Abstract] |
Real Estate | Note 3. Real Estate On March 2, 2022, the Company announced that following its previously announced dual-track review of strategic alternatives, the Company has entered into definitive agreements that will result in the sale of the Company and its assets in a series of related all-cash transactions. The Company (1) entered into an agreement to sell a portfolio of 33 grocery-anchored shopping centers for $840.0 million, (2) entered into an agreement to sell the Revelry redevelopment project for $34.0 million, (3) is negotiating a contract for the sale of the Northeast Heights redevelopment project for $46.5 million and (4) entered into an agreement to sell the Company and its remaining assets for $291.3 million. The acquirer of the portfolio of 33 grocery-anchored shopping centers has agreed to backstop the two redevelopment transactions at the aggregate price of $80.5 million if they do not close before the closing of the shopping center portfolio transaction. The contracts to sell the 33 grocery-anchored shopping centers and to sell the Company and its remaining assets require shareholder approval. As part of the dual-track strategic alternatives process, the Company has determined that certain of the Company’s operating properties would be sold significantly prior to the end of their previously estimated hold periods. The Company recorded $101.7 million in impairment charges, of which $83.2 million relate to assets held for use and $18.5 million relate to assets held for sale. These impairment charges have been included in continuing operations in the accompanying consolidated statements of operations. Investment in unconsolidated joint venture On May 5, 2021, the Company formed a joint venture with Goldman Sachs Urban Investment Group and Asland Capital Partners (the “Joint Venture”) for the construction of an approximately 258,000 square foot six-story commercial building in Washington, D.C. consisting of approximately 240,000 square feet of office space which is 100% leased to the Washington, D.C., Department of General Services (“DGS”) for its headquarters and approximately 18,000 square feet of street-level retail. The term of the lease with DGS is for 20 years and 10 months, to commence upon substantial completion and delivery to the DGS. This building is planned as the first phase of Northeast Heights, a redevelopment of two existing shopping centers, East River Park and Senator Square, into a mixed-use residential, office and retail property. Further, the Joint Venture has secured construction financing from JP Morgan not to exceed $105 million. The construction loan initially bears interest at LIBOR plus 200 basis points and has an initial term of three years with two, one-year extension options subject to customary conditions. The Company has a 10% interest in the joint venture and is a co-general partner along with Asland Capital Partners. The Company has contributed approximately $4.7 million of capital to the Joint Venture as of December 31, 2021. The Company has sold approximately $8.0 million of development costs to the Joint Venture as part of its formation on May 5, 2021. The Joint Venture currently estimates that the space will be delivered during the end of the fourth quarter 2022. Upon completion of the building, DGS will be obligated to pay initial annual net rent of approximately $5.4 million per year, subject to a 2.5% annual escalator on each anniversary of rent commencement, plus certain operating costs, property taxes and amortization of tenant improvements together totaling approximately an additional $8.1 million per year, for an aggregate total annual rent of approximately $13.5 million. The lease provides for a free rent period of 10 months immediately following rent commencement. The Lease also provides DGS with a tenant credit of approximately $6.8 million to be applied, at DGS’s election, against either annual rent or any other tenant payment obligations including tenant improvement costs, in excess of the tenant improvement allowance. Pursuant to the lease, the Joint Venture will contribute up to $155 per rentable square foot toward the cost of tenant improvements, to be amortized over 240 months. In addition, the lease provides that the Joint Venture will contribute $9.38 per rentable square foot in additional tenant improvement allowance between the 10th and 12th lease years, upon DGS’s timely election. The obligations of DGS under the Lease are subject to annual budget appropriation. Real estate activity for 2021 and 2020 is composed of the following:
|  | Years ended December 31, |
|  | 2021 |  |  | 2020 |
Cost |  |  |  |  |  |  |  |
Balance, beginning of year |  | $ | 1,527,478,000 |  |  | $ | 1,515,206,000 |
Properties transferred to held for sale |  |  | (184,639,000 | ) |  |  | (22,512,000 | )
Outparcel dispositions |  |  | (387,000 | ) |  |  | (840,000 | )
Property impairments |  |  | (83,224,000 | ) |  |  | — |
Improvements and betterments |  |  | 29,296,000 |  |  |  | 35,624,000 |
Balance, end of the year |  | $ | 1,288,524,000 |  |  | $ | 1,527,478,000 |
Accumulated depreciation |  |  |  |  |  |  |  |
Balance, beginning of the year |  | $ | 428,569,000 |  |  | $ | 389,861,000 |
Properties transferred held for sale |  |  | (55,165,000 | ) |  |  | (3,947,000 | )
Outparcel dispositions |  |  | — |  |  |  | (90,000 | )
Depreciation expense |  |  | 36,338,000 |  |  |  | 42,745,000 |
Balance, end of the year |  | $ | 409,742,000 |  |  | $ | 428,569,000 |
Net book value |  | $ | 878,782,000 |  |  | $ | 1,098,909,000 |
At December 31, 2021, certain properties were pledged as collateral for a mortgage loan payable. See Note 8 - “Mortgage Loans Payable and Credit Facilities”. 2021 Acquisition On October 14, 2021, the Company purchased the 60% minority ownership in the San Souci Plaza joint venture, located in California, Maryland. The purchase price for the minority ownership was $0.3 million. 2019 Acquisition On June 19, 2019, the Company purchased Girard Plaza, a shopping center adjacent to its South Philadelphia property, located in Philadelphia, Pennsylvania. The purchase price for the property was $8.5 million, which has been allocated to real estate assets and liabilities. Dispositions During 2021, 2020 and 2019, the Company sold the properties listed below:
|  |  |  |  |  |  |  |  |  | Gain on Sale/ |
|  |  |  | Date |  | Sales |  |  | Reversal of |
Property |  | Location |  | Sold |  | Price |  |  | Impairment |
2021 |  |  |  |  |  |  |  |  |  |  |  |
Kempsville Crossing (land parcel) |  | Virginia Beach, VA |  | 2/24/2021 |  | $ | 1,300,000 |  |  | $ | 1,047,000 |
The Commons |  | Dubois, PA |  | 5/5/2021 |  |  | 9,761,000 |  |  |  | 1,849,000 |
Camp Hill Shopping Center |  | Camp Hill, PA |  | 6/21/2021 |  |  | 89,662,500 |  |  |  | 48,857,000 |
|  |  |  |  |  | $ | 100,723,500 |  |  | $ | 51,753,000 |
2020 |  |  |  |  |  |  |  |  |  |  |  |
Metro Square |  | Owings Mills, MD |  | 7/9/2020 |  | $ | 4,288,000 |  |  | $ | - |
Oakland Mills outparcel building |  | Columbia, MD |  | 9/17/2020 |  |  | 1,050,000 |  |  |  | 643,000 |
Glen Allen Shopping Center |  | Glen Allen, VA |  | 10/8/2020 |  |  | 8,540,000 |  |  |  | 1,780,000 |
Pine Grove Plaza outparcel building |  | Brown Mills, NJ |  | 11/2/2020 |  |  | 1,100,000 |  |  |  | 565,000 |
Suffolk Plaza |  | Suffolk, VA |  | 12/10/2020 |  |  | 6,950,000 |  |  |  | 1,408,000 |
|  |  |  |  |  | $ | 21,928,000 |  |  | $ | 4,396,000 |
2019 |  |  |  |  |  |  |  |  |  |  |  |
Maxatawny Marketplace |  | Maxatawny, PA |  | 2/15/2019 |  | $ | 10,330,000 |  |  | $ | 101,000 |
Fort Washington Center |  | Fort Washington, PA |  | 6/26/2019 |  |  | 9,048,000 |  |  |  | 2,841,000 |
|  |  |  |  |  | $ | 19,378,000 |  |  | $ | 2,942,000 |
The Company recorded impairment charges of $7.2 million relating to Metro Square during 2020, which are included in continuing operations in the accompanying consolidated statements of operations. Real Estate Held for Sale As of December 31, 2021, Carll’s Corner, located in Bridgeton, New Jersey, Riverview Plaza, located in Philadelphia, Pennsylvania, and East River Park and Senator Square, both located in Washington, D.C., have been classified as “real estate held for sale” on the accompanying consolidated balance sheet. During 2021, the Company recorded a (1) reversal of impairment charges of $1.8 million for The Commons, located in Dubois, Pennsylvania, and (2) recorded, as part of the dual-track strategic alternatives process, impairment charges of $18.5 million. In addition, the Company recorded impairment charges of $0.4 million and $8.9 million in connection with The Commons in 2020 and 2019, respectively. These impairment charges have been included in continuing operations in the accompanying consolidated statement of operations.

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- Definition The entire disclosure for certain real estate investment financial statements, real estate investment trust operating support agreements, real estate owned, retail land sales, time share transactions, as well as other real estate related disclosures. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 970 -URI http://asc.fasb.org/topic&trid=2156125 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 978 -URI http://asc.fasb.org/topic&trid=2134977 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 976 -URI http://asc.fasb.org/topic&trid=2134846 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 974 -URI http://asc.fasb.org/topic&trid=2156429 Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 972 -URI http://asc.fasb.org/topic&trid=2134617 + Details
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