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SEGMENT DISCLOSURE | 6 Months Ended
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Jun. 30, 2015
SEGMENT DISCLOSURE |
SEGMENT DISCLOSURE | 16. SEGMENT DISCLOSURE In accordance with ASC Topic 280, Segment Reporting, our reportable segments consist of three types of commercial real estate properties, namely, office, hotel and multifamily, as well as a segment for our lending operations, which is held for sale as of June 30, 2015. Management internally evaluates the operating performance and financial results of the segments based on net operating income. We also have certain general and administrative level activities, including public company expenses, legal, accounting, and tax preparation that are not considered separate operating segments. The reportable segments are accounted for on the same basis of accounting as described in the notes to our audited consolidated financial statements for the year ended December 31, 2014 included in our Annual Report on Form 10-K filed with the SEC on March 16, 2015. We evaluate the performance of our real estate segments based on net operating income, which is defined as rental and other property income and tenant reimbursements less property and related expenses, and excludes nonproperty income and expenses, interest expense, depreciation and amortization, corporate related general and administrative expenses, and transaction costs. The net operating income of our reportable segments is as follows:
|  | Three Months Ended June 30, |  | Six Months Ended June 30, |
|  | 2015 |  | 2014 |  | 2015 |  | 2014 |
|  | (in thousands) |
Office: |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues |  | $ | 47,084 |  | $ | 45,181 |  | $ | 93,699 |  | $ | 88,455 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Property expenses: |  |  |  |  |  |  |  |  |  |  |  |  |
Operating |  |  | 20,060 |  |  | 17,933 |  |  | 39,451 |  |  | 35,586 |
General and administrative |  |  | 113 |  |  | 76 |  |  | 426 |  |  | 392 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total property expenses |  |  | 20,173 |  |  | 18,009 |  |  | 39,877 |  |  | 35,978 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Segment net operating income—office |  |  | 26,911 |  |  | 27,172 |  |  | 53,822 |  |  | 52,477 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Hotel: |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues |  |  | 15,822 |  |  | 14,798 |  |  | 31,541 |  |  | 29,137 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Property expenses: |  |  |  |  |  |  |  |  |  |  |  |  |
Operating |  |  | 9,987 |  |  | 9,923 |  |  | 20,664 |  |  | 19,769 |
General and administrative |  |  | 38 |  |  | 36 |  |  | 79 |  |  | 73 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total property expenses |  |  | 10,025 |  |  | 9,959 |  |  | 20,743 |  |  | 19,842 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Segment net operating income—hotel |  |  | 5,797 |  |  | 4,839 |  |  | 10,798 |  |  | 9,295 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Multifamily: |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues |  |  | 4,013 |  |  | 5,208 |  |  | 8,918 |  |  | 10,192 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Property expenses: |  |  |  |  |  |  |  |  |  |  |  |  |
Operating |  |  | 2,938 |  |  | 2,583 |  |  | 5,579 |  |  | 4,670 |
General and administrative |  |  | 90 |  |  | 54 |  |  | 173 |  |  | 79 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total property expenses |  |  | 3,028 |  |  | 2,637 |  |  | 5,752 |  |  | 4,749 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Segment net operating income—multifamily |  |  | 985 |  |  | 2,571 |  |  | 3,166 |  |  | 5,443 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total segment net operating income |  | $ | 33,693 |  | $ | 34,582 |  | $ | 67,786 |  | $ | 67,215 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
A reconciliation of segment net operating income to net income is as follows:
|  | Three Months Ended June 30, |  | Six Months Ended June 30, |
|  | 2015 |  | 2014 |  | 2015 |  | 2014 |
|  | (in thousands) |
Total segment net operating income |  | $ | 33,693 |  | $ | 34,582 |  | $ | 67,786 |  | $ | 67,215 |
Interest |  |  | (5,586 | ) |  | (4,565 | ) |  | (10,989 | ) |  | (8,602 | )
General and administrative |  |  | (1,714 | ) |  | (2,191 | ) |  | (3,869 | ) |  | (2,587 | )
Asset management fees and other fees to related parties |  |  | (7,456 | ) |  | (6,338 | ) |  | (14,665 | ) |  | (12,075 | )
Transaction costs |  |  | (373 | ) |  | (32 | ) |  | (801 | ) |  | (500 | )
Depreciation and amortization |  |  | (17,566 | ) |  | (17,286 | ) |  | (36,694 | ) |  | (33,915 | )
Bargain purchase gain |  |  | — |  |  | — |  |  | — |  |  | 4,918 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Income from continuing operations |  |  | 998 |  |  | 4,170 |  |  | 768 |  |  | 14,454 |
Discontinued operations |  |  |  |  |  |  |  |  |  |  |  |  |
Income from operations of assets held for sale |  |  | 3,984 |  |  | 4,344 |  |  | 6,946 |  |  | 5,277 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net income from discontinued operations |  |  | 3,984 |  |  | 4,344 |  |  | 6,946 |  |  | 5,277 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net income |  |  | 4,982 |  |  | 8,514 |  |  | 7,714 |  |  | 19,731 |
Net income attributable to noncontrolling interests |  |  | (6 | ) |  | (115 | ) |  | (6 | ) |  | (113 | )
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net income attributable to stockholders |  | $ | 4,976 |  | $ | 8,399 |  | $ | 7,708 |  | $ | 19,618 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
The condensed assets for each of the segments as of June 30, 2015 and December 31, 2014, along with capital expenditures and loan originations for the six months ended June 30, 2015 and 2014, are as follows:
|  | June 30, 2015 |  | December 31, 2014 |
|  | (in thousands) |
Condensed assets: |  |  |  |  |  |  |
Office |  | $ | 1,517,155 |  | $ | 1,534,610 |
Hotel |  |  | 177,284 |  |  | 174,679 |
Multifamily |  |  | 170,241 |  |  | 171,226 |
Lending assets held for sale |  |  | 217,418 |  |  | 208,799 |
Non-segment assets |  |  | 8,690 |  |  | 5,368 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total assets |  | $ | 2,090,788 |  | $ | 2,094,682 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
|  | Six Months Ended June 30, |
|  | 2015 |  | 2014 |
|  | (in thousands) |
Capital expenditures(1): |  |  |  |  |  |  |
Office |  | $ | 14,200 |  | $ | 11,428 |
Hotel |  |  | 738 |  |  | 721 |
Multifamily |  |  | 882 |  |  | 429 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total capital expenditures |  |  | 15,820 |  |  | 12,578 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Loan originations included in assets held for sale |  |  | 41,121 |  |  | 25,191 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total capital expenditures and loan originations |  | $ | 56,941 |  | $ | 37,769 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
(1) | Represents additions and improvements to real estate investments, excluding acquisitions.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8981-108599 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9038-108599 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 33 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8971-108599 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8595-108599 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8380-108599 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8984-108599 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9031-108599 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9054-108599 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8538-108599 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 29 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8864-108599 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8924-108599 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8906-108599 + Details
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