3 unchanged sentences
(In thousands, except share data)
−Removed: June 30, 2022
+Added: September 30, 2022
December 31, 2021
8 unchanged sentences
Right-of-use lease assets
−Removed: Receivable from lease termination
Other assets, net
10 unchanged sentences
Commitments and contingencies (Note 4)
−Removed: Common Stock, $ 0.01 par value, 510,587,500 shares authorized at both June 30, 2022 and December 31, 2021, and 149,096,590 and 149,818,021 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively
+Added: Common Stock, $ 0.01 par value, 510,587,500 shares authorized at both September 30, 2022 and December 31, 2021, and 149,124,466 and 149,818,021 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively
Additional paid-in capital
9 unchanged sentences
Three Months Ended
−Removed: Six Months Ended
+Added: September 30,
+Added: Nine Months Ended
+Added: September 30,
Rental and other property revenues
10 unchanged sentences
Lease modification income
−Removed: Other (expense) income, net
−Removed: Income (expense) before income tax benefit
−Removed: Income tax (expense) benefit
+Added: Other income (expense), net
+Added: Income (loss) before income tax
+Added: Income tax benefit (expense)
Net income (loss)
17 unchanged sentences
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
−Removed: For the Three Months Ended June 30, 2022 and 2021
+Added: For the Three Months Ended September 30, 2022 and 2021
(In thousands)
2 unchanged sentences
Retained Earnings (Accumulated Deficit)
−Removed: Balances at March 31, 2021
−Removed: Net loss attributable to Aimco
−Removed: Net income attributable to noncontrolling interests in consolidated real estate partnerships
−Removed: Net loss attributable to common noncontrolling interests in Aimco Operating Partnership
+Added: Balances at June 30, 2021
+Added: Net income (loss)
Redemption of OP Units
Share-based compensation expense
−Removed: Distribution to noncontrolling interests in consolidated real estate partnerships
+Added: Contributions from noncontrolling interests
+Added: Distributions to noncontrolling interests
+Added: Balances at September 30, 2021
Balances at June 30, 2022
−Removed: Balances at March 31, 2022
−Removed: Net income attributable to Aimco
−Removed: Net income attributable to noncontrolling interests in consolidated real estate partnerships
−Removed: Net income attributable to common noncontrolling interests in Aimco Operating Partnership
+Added: Net income (loss)
Redemption of OP Units
Share-based compensation expense
−Removed: Distribution to noncontrolling interests in consolidated real estate partnerships
+Added: Distributions to noncontrolling interests
+Added: Contributions from noncontrolling interests
Purchase of noncontrolling interests in consolidated real estate partnerships
Common stock repurchased
−Removed: Balances at June 30, 2022
+Added: Cash Dividends
+Added: Balances at September 30, 2022
See notes to condensed consolidated financial statements.
1 unchanged sentence
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
−Removed: For the Six Months Ended June 30, 2022 and 2021
+Added: For the Nine Months Ended September 30, 2022 and 2021
(In thousands)
3 unchanged sentences
Balances at December 31, 2020
−Removed: Net income attributable to Aimco
−Removed: Net income attributable to noncontrolling interests in consolidated real estate partnerships
−Removed: Net income attributable to common noncontrolling interests in Aimco Operating Partnership
+Added: Net income (loss)
Redemption of OP Units
Share-based compensation expense
−Removed: Distribution to noncontrolling interests in consolidated real estate partnerships
+Added: Contributions from noncontrolling interests
+Added: Distributions to noncontrolling interests
Other common stock issuances
−Removed: Balances at June 30, 2021
+Added: Balances at September 30, 2021
Balances at December 31, 2021
−Removed: Net income attributable to Aimco
−Removed: Net income attributable to noncontrolling interests in consolidated real estate partnerships
−Removed: Net income attributable to common noncontrolling interests in Aimco Operating Partnership
+Added: Net income (loss)
Redemption of OP Units
Share-based compensation expense
−Removed: Distribution to noncontrolling interests in consolidated real estate partnerships
−Removed: Contributions from noncontrolling interests in consolidated real estate partnerships
+Added: Distributions to noncontrolling interests
+Added: Contributions from noncontrolling interests
Purchase of noncontrolling interests in consolidated real estate partnerships
2 unchanged sentences
Redemption of redeemable noncontrolling interests in consolidated real estate partnerships
−Removed: Balances at June 30, 2022
+Added: Cash Dividends
+Added: Balances at September 30, 2022
See notes to condensed consolidated financial statements.
2 unchanged sentences
(In thousands)
−Removed: Six Months Ended June 30,
+Added: Nine Months Ended September 30,
CASH FLOWS FROM OPERATING ACTIVITIES:
−Removed: Adjustments to reconcile net income to net cash provided by
−Removed: operating activities:
+Added: Net income (loss)
+Added: Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
Income from unconsolidated real estate partnerships
−Removed: Unrealized gains on interest rate options
+Added: Realized and unrealized gains on interest rate options
Income tax expense (benefit)
1 unchanged sentence
Mezzanine investment, net
−Removed: Realized gain on interest rate option
Loss on extinguishment of debt, net
Lease modification income
−Removed: Gain on equity investment redemption
+Added: Realized and unrealized gains (losses) on equity investments
Gain on disposition of real estate
2 unchanged sentences
Other assets, net
−Removed: Net cash received from lease incentive
+Added: Net cash received from development property lease terminations
Accrued liabilities and other
6 unchanged sentences
Investment in IQHQ
+Added: Redemption of IQHQ investment
Investment in unconsolidated real estate partnerships
1 unchanged sentence
Net cash used in investing activities
−Removed: See notes to condensed consolidated financial statements.
−Removed: APARTMENT INVESTMENT AND MANAGEMENT COMPANY
−Removed: CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
−Removed: (In thousands)
−Removed: Six Months Ended June 30,
CASH FLOWS FROM FINANCING ACTIVITIES:
3 unchanged sentences
Principal repayments on non-recourse property debt
+Added: Principal repayments on construction loans
Principal repayments on Notes Payable to AIR
4 unchanged sentences
Common stock repurchased
−Removed: Redemption of noncontrolling interest in real estate partnership
−Removed: Distributions to noncontrolling interests in real estate partnerships
−Removed: Contributions from noncontrolling interests in consolidated
−Removed: real estate partnerships
−Removed: Contributions from redeemable noncontrolling interests in consolidated
−Removed: real estate partnerships
+Added: Dividend paid on common stock
+Added: Distributions to noncontrolling interests
+Added: Distributions to redeemable noncontrolling interests
+Added: Contributions from noncontrolling interests
+Added: Contributions from redeemable noncontrolling interests
Redemption of common and preferred OP units
−Removed: Redemption of redeemable noncontrolling interests in consolidated
−Removed: real estate partnerships
+Added: Redemption of noncontrolling interests
+Added: Redemption of redeemable noncontrolling interests
Other financing activities
Net cash provided by (used in) financing activities
−Removed: NET DECREASE IN CASH, CASH EQUIVALENTS,
−Removed: AND RESTRICTED CASH
−Removed: CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT
−Removed: BEGINNING OF PERIOD
−Removed: CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT
−Removed: END OF PERIOD
−Removed: (1) Accrued capital expenditures were $ 29.1 mill ion a nd $ 18.7 millio n as of June 30, 2022 and 2021 , respectively.
+Added: NET DECREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH
+Added: CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT BEGINNING OF PERIOD
+Added: CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD
+Added: (1) Accrued capital expenditures were $ 31.4 million and $ 19.4 million as of September 30, 2022 and 2021, respectively.
See notes to condensed consolidated financial statements.
2 unchanged sentences
(In thousands)
−Removed: June 30, 2022
+Added: September 30, 2022
December 31, 2021
8 unchanged sentences
Right-of-use lease assets
−Removed: Receivable from lease termination
Other assets, net
23 unchanged sentences
Three Months Ended
−Removed: Six Months Ended
+Added: September 30,
+Added: Nine Months Ended
+Added: September 30,
Rental and other property revenues
10 unchanged sentences
Lease modification income
−Removed: Other (expense) income, net
−Removed: Income (loss) before income tax benefit
−Removed: Income tax (expense) benefit
+Added: Other income (expense), net
+Added: Income (loss) before income tax
+Added: Income tax benefit (expense)
Net income (loss)
15 unchanged sentences
CONDENSED CONSOLIDATED STATE MENTS OF PARTNERS’
−Removed: For the three months ended June 30, 2022 and 2021
+Added: For the three months ended September 30, 2022 and 2021
(In thousands)
8 unchanged sentences
Partners’
−Removed: Balances at March 31, 2021
−Removed: Net loss attributable to Aimco Operating Partnership
−Removed: Net income attributable to noncontrolling interests in consolidated real estate partnerships
+Added: Balances at June 30, 2021
+Added: Net income (loss)
Redemption of OP Units
Share-based compensation expense
−Removed: Distribution to noncontrolling interests in consolidated real estate partnerships
+Added: Contributions from noncontrolling interests
+Added: Distributions to noncontrolling interests
+Added: Balances at September 30, 2021
Balances at June 30, 2022
−Removed: Balances at March 31, 2022
−Removed: Net income attributable to Aimco Operating Partnership
−Removed: Net income attributable to noncontrolling interests in consolidated real estate partnerships
+Added: Net income (loss)
Redemption of OP Units
Share-based compensation expense
−Removed: Distribution to noncontrolling interests in consolidated real estate partnerships
+Added: Distributions to noncontrolling interests
+Added: Contributions from noncontrolling interests
Purchase of noncontrolling interests in consolidated real estate partnerships
Repurchases of OP Units held by Aimco
−Removed: Balances at June 30, 2022
+Added: Cash Dividends
+Added: Balances at September 30, 2022
See notes to condensed consolidated financial statements.
1 unchanged sentence
CONDENSED CONSOLIDATED STATEMENTS OF PARTNERS’
−Removed: For the six months ended June 30, 2022 and 2021
+Added: For the nine months ended September 30, 2022 and 2021
(In thousands)
9 unchanged sentences
Balances at December 31, 2020
−Removed: Net income attributable to Aimco Operating Partnership
−Removed: Net income attributable to noncontrolling interests in consolidated real estate partnerships
+Added: Net income (loss)
Redemption of OP Units
1 unchanged sentence
Share-based compensation expense
−Removed: Distribution to noncontrolling interests in consolidated real estate partnerships
−Removed: Balances at June 30, 2021
+Added: Contribution from noncontrolling interests
+Added: Distributions to noncontrolling interests
+Added: Balances at September 30, 2021
Balances at December 31, 2021
−Removed: Net income attributable to Aimco Operating Partnership
−Removed: Net income attributable to noncontrolling interests in consolidated real estate partnerships
+Added: Net income (loss)
Redemption of OP Units
Share-based compensation expense
−Removed: Distribution to noncontrolling interests in consolidated real estate partnerships
−Removed: Contributions from noncontrolling interests in consolidated real estate partnerships
+Added: Distributions to noncontrolling interests
+Added: Contributions from noncontrolling interests
Purchase of noncontrolling interests in consolidated real estate partnerships
2 unchanged sentences
Redemption of redeemable noncontrolling interests in consolidated real estate partnerships
−Removed: Balances at June 30, 2022
+Added: Cash dividends
+Added: Balances at September 30, 2022
See notes to condensed consolidated financial statements.
2 unchanged sentences
(In thousands)
−Removed: Six Months Ended June 30,
+Added: Nine Months Ended September 30,
CASH FLOWS FROM OPERATING ACTIVITIES:
−Removed: Adjustments to reconcile net income to net cash provided by
−Removed: operating activities:
+Added: Net income (loss)
+Added: Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
Income from unconsolidated real estate partnerships
−Removed: Unrealized gains on interest rate options
+Added: Realized and unrealized gains on interest rate options
Income tax expense (benefit)
1 unchanged sentence
Mezzanine investment, net
−Removed: Realized gain on interest rate option
Loss on extinguishment of debt, net
Lease modification income
−Removed: Gain on equity investment redemption
+Added: Realized and unrealized gains (losses) on equity investments
Gain on disposition of real estate
2 unchanged sentences
Other assets, net
−Removed: Net cash received from lease incentive
+Added: Net cash received from development property lease terminations
Accrued liabilities and other
6 unchanged sentences
Investment in IQHQ
+Added: Redemption of IQHQ investment
Investment in unconsolidated real estate partnerships
1 unchanged sentence
Net cash used in investing activities
−Removed: See notes to condensed consolidated financial statements.
−Removed: AIMCO OP L.P.
−Removed: CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
−Removed: (In thousands)
−Removed: Six Months Ended June 30,
CASH FLOWS FROM FINANCING ACTIVITIES:
3 unchanged sentences
Principal repayments on non-recourse property debt
+Added: Principal repayments on construction loans
Principal repayments on Notes Payable to AIR
3 unchanged sentences
Payments of prepayment premiums
−Removed: Redemption of OP Units
−Removed: Redemption of noncontrolling interest in real estate partnership
−Removed: Distributions to noncontrolling interests in real estate partnerships
−Removed: Contributions from noncontrolling interests in consolidated
−Removed: real estate partnerships
−Removed: Contributions from redeemable noncontrolling interests in consolidated
−Removed: real estate partnerships
+Added: Common stock repurchased
+Added: Dividend paid on common stock
+Added: Distributions to noncontrolling interests
+Added: Distributions to redeemable noncontrolling interests
+Added: Contributions from noncontrolling interests
+Added: Contributions from redeemable noncontrolling interests
Redemption of common and preferred OP units
−Removed: Redemption of redeemable noncontrolling interests in consolidated
−Removed: real estate partnerships
+Added: Redemption of noncontrolling interests
+Added: Redemption of redeemable noncontrolling interests
Other financing activities
Net cash provided by (used in) financing activities
−Removed: NET DECREASE IN CASH, CASH EQUIVALENTS,
−Removed: AND RESTRICTED CASH
−Removed: CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT
−Removed: BEGINNING OF PERIOD
−Removed: CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT
−Removed: END OF PERIOD
−Removed: (1) Accrued capital expenditures were $ 29.1 mill ion a nd $ 18.7 million as of June 30, 2022 and 2021 , respectively.
+Added: NET DECREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH
+Added: CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT BEGINNING OF PERIOD
+Added: CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD
+Added: (1) Accrued capital expenditures were $ 31.4 million and $ 19.4 million as of September 30, 2022 and 2021, respectively.
+Added: See notes to condensed consolidated financial statements.
APARTMENT INVESTMENT AND MANAGEMENT COMPANY
1 unchanged sentence
NOTES TO CONDENSED CONSOLID ATED FINANCIAL STATEMENTS
−Removed: June 30, 2022
+Added: September 30, 2022
Note 1 —
9 unchanged sentences
Events noted in this filing as occurring before December 15, 2020, were those entered into by Aimco Predecessor.
−Removed: As of June 30, 2022, Aimco owned 92.6 % of the legal interest in the common partnership units of Aimco Operating Partnership and 95.0 % of the economic interest in Aimco Operating Partnership.
+Added: As of September 30, 2022, Aimco owned 92.7 % of the legal interest in the common partnership units of Aimco Operating Partnership and 95.0 % of the economic interest in Aimco Operating Partnership.
The remaining 7.3 % legal interest is owned by limited partners.
3 unchanged sentences
These real estate investments include:
−Removed: a portfolio of 28 operating apartment communities ( 24 consolidated properties with 5,879 apartment homes and four unconsolidated operating properties), diversified by both geography and price point, in ten major U.S.
+Added: a portfolio of 26 operating apartment communities ( 22 consolidated properties with 5,640 apartment homes and four unconsolidated operating properties), diversified by both geography and price point;
one commercial office building that is part of a land assemblage;
1 unchanged sentence
land parcels held for development.
−Removed: and four residential apartment communities with 865 a partment homes for which we have completed the redevelopment, but have not achieved stabilization.
Our real estate portfolio also includes one land parcel held for sale and two unconsolidated investments in land held for development.
9 unchanged sentences
In the opinion of management, all adjustments, consisting of normal recurring items, considered necessary for a fair presentation have been included.
−Removed: Operating results for the three and six months ended June 30, 2022, are not necessarily indicative of the results that may be expected for the year ending December 31, 2022.
+Added: Operating results for the three and nine months ended September 30, 2022, are not necessarily indicative of the results that may be expected for the year ending December 31, 2022.
The Condensed Consolidated Balance Sheets of Aimco and Aimco Operating Partnership as of December 31, 2021 have been derived from their respective audited financial statements at that date, but do not include all of the information and disclosures required by GAAP for complete financial statements.
17 unchanged sentences
Redeemable Noncontrolling Interests in Consolidated Real Estate Partnerships
−Removed: Redeemable noncontrolling interests consists of equity int erests held by a limited partner in a consolidated real estate partnership that has a finite life.
−Removed: During the quarter ended March 31, 2022, we acquired all the outstanding redeemable noncontrolling interests in two consolidated properties for $ 5.1 million.
−Removed: At the time of redemption, the carrying amount of the redeemable non-controlling interests was $ 4.9 million.
−Removed: Prior to our acquisition in the first quarter of 2022, we attributed to noncontrolling interests their share of income or loss of consolidated partnerships based on their proportionate interest in the results of operations of the partnerships, including their share of losses.
−Removed: Redee mable noncontrolling interests in consolidated real estate partnerships as of June 30, 2022 consists of our institutional partner’s equity interest in our Upton Joint Venture, which provides our partner with an accruing 9.7 % r ate of return on their investment.
+Added: Redeemable noncontrolling interests consist of equity interests held by a limited partner in a consolidated real estate partnership that has a finite life.
If a consolidated real estate partnership includes redemption rights that are not within our control, the noncontrolling interest is included as temporary equity.
−Removed: The assets of our consolidated real estate partnerships must first be used to settle the liabilities of the consolidated real estate partnerships.
−Removed: The consolidated real estate partnerships’
−Removed: creditors do not have recourse to the general credit of Aimco Operating Partnership.
−Removed: The following table presents a rollforward of our redeemable noncontrolling interests in consolidated real estate partnerships from December 31, 2021 to June 30, 2022 (in thousands):
+Added: The assets of these consolidated real estate partnerships must first be used to settle the liabilities of the consolidated real estate partnerships.
+Added: The consolidated real estate partnerships' creditors do not have recourse to the general credit of Aimco Operating Partnership.
+Added: In July 2022, we closed a $ 102.0 million preferred equity financing with an institutional investor, providing for a fixed 8 % annual rate of return payable monthly.
+Added: In February 2022, we acquired all of the outstanding redeemable noncontrolling interests in two consolidated properties for $ 5.1 million.
+Added: At the time of redemption, the carrying amount of the redeemable non-controlling interests was $ 4.9 million.
+Added: Redeemable noncontrolling interests in consolidated real estate partnerships as of September 30, 2022 consists of the $ 102.0 million preferred equity noted above and our partner's equity interest in the Upton Joint Venture, which provides for an accruing 9.7 % rate of return on their investment.
+Added: These investment interests are presented as Redeemable noncontrolling interests in consolidated real estate partnerships in our Condensed Consolidated Balance Sheet as of September 30, 2022.
+Added: The following table shows changes in our redeemable noncontrolling interests in consolidated real estate partnerships from December 31, 2021 to September 30, 2022 (in thousands):
Balance at December 31, 2021
Capital contributions
−Removed: Balance at June 30, 2022
+Added: Distributions
+Added: Balance at September 30, 2022
Mezzanine Investment
−Removed: On November 26, 2019, Aimco Predecessor made a five-year , $ 275.0 million mezzanine loan to the partnership owning the “Parkmerced Apartments”
+Added: In November 2019, Aimco Predecessor made a five-year , $ 275.0 million mezzanine loan to the partnership owning the “Parkmerced Apartments”
located in southwest San Francisco (the “Mezzanine Investment”).
3 unchanged sentences
At the time of the Separation and as of the date of this filing, legal title of these subsidiaries had not yet transferred to Aimco.
−Removed: Until legal title of the subsidiaries is transferred, AIR is obligated to pass payments on such loan to us, and we are obligated to indemnify AIR against any costs and expenses related thereto.
+Added: Until legal title of the subsidiaries is transferred, AIR is obligated to pass payments received on such loan to us, and we are obligated to indemnify AIR against any costs and expenses related thereto.
We have the risks and rewards of ownership of the Mezzanine Investment and have recognized an asset related to our right to receive the Mezzanine Investment from AIR.
1 unchanged sentence
The income recognized primarily represents the interest accrued under the terms of the underlying mezzanine loan.
−Removed: The loan is subject to certain risks, including, but not limited to, those resulting from the lingering disruption due to the COVID-19 pandemic and associated response, and any similar events that might occur in the future, which may result in all or a portion of the loan not being repaid.
−Removed: In the event we determine that a portion of the Mezzanine Investment is not recoverable, we will recognize an impairment .
−Removed: Income Tax Benefit
+Added: The loan and the underlying real estate are subject to certain risks, including, but not limited to, those resulting from the lingering disruption due to the COVID-19 pandemic and associated response, and any similar events that might occur in the future, which may result in all or a portion of the loan not being repaid.
+Added: In the event we conclude that a portion of the Mezzanine Investment is not recoverable, we will recognize an impairment .
+Added: Income Tax Benefit (Expense)
Certain aspects of our operations, including our development and redevelopment activities, are conducted through taxable REIT subsidiaries, or TRS entities.
1 unchanged sentence
Our income tax benefit calculated in accordance with GAAP includes income taxes associated with the income or loss of our TRS entities.
−Removed: Income taxes, as well as changes in valuation allowance and incremental deferred tax items in conjunction with intercompany asset transfers and internal restructurings (if applicable), are included in Income tax benefit in our Condensed Consolidated Statements of Operations .
+Added: Income taxes, as well as changes in valuation allowance and incremental deferred tax items in conjunction with intercompany asset transfers and internal restructurings (if applicable), are included in Income tax benefit (expense) in our Condensed Consolidated Statements of Operations .
Consolidated GAAP income or loss subject to tax consists of pretax income or loss of our taxable entities and gains retained by the REIT.
−Removed: For the three and six months ended June 30, 2022 , we had consolidated net income subject to tax of $ 181.4 million and $ 166.6 million, respectively.
−Removed: For the three and six months ended June 30, 2021 , we had consolidated net losses subject to tax of $ 9.0 million and $ 18.5 million, respectively.
−Removed: For the three months ended June 30, 2022, we recognized income tax expense of $ 46.0 million compared to a $ 2.8 million benefit during the same period in 2021.
−Removed: The change is primarily due to the GAAP income taxes associated with the lease modification income recognized in the second quarter of 2022.
−Removed: For the six months ended June 30, 2022, we recognized income tax expense of $ 41.9 million compared to a $ 7.9 million benefit during the same period in 2021 .
−Removed: The change is primarily due to the GAAP income taxes associated with the lease modification income recognized in the second quarter of 2022.
+Added: For the three and nine months ended September 30, 2022 , we had consolidated net loss and income subject to tax of $ 75.6 million and $ 91.0 million, respectively.
+Added: For the three and nine months ended September 30, 2021 , we had consolidated net losses subject to tax of $ 7.9 million and $ 26.4 million, respectively.
+Added: For the three months ended September 30, 2022, we recognized income tax benefit of $ 17.6 million compared to a $ 2.0 million benefit during the same period in 2021.
+Added: The change is primarily due to the GAAP income taxes associated with the lease modification depreciation expense recognized in the third quarter of 2022.
+Added: For the nine months ended September 30, 2022, we recognized income tax expense of $ 24.3 million compared to a $ 9.9 million benefit during the same period in 2021 .
+Added: The change is primarily due to the GAAP income taxes associated with the net lease modification income recognized in 2022.
Use of Estimates
9 unchanged sentences
Other assets were comprised of the following amounts (in thousands):
−Removed: June 30, 2022
+Added: September 30, 2022
December 31, 2021
Other investments
−Removed: Assets held for sale (1)
Notes receivable
Unconsolidated real estate partnerships
−Removed: Prepaid expenses and real estate taxes
+Added: Assets held for sale (1)
Deferred costs, deposits, and other
+Added: Prepaid expenses and real estate taxes
Corporate fixed assets
−Removed: Accounts receivable, net of allowances of $ 1,397 and $ 1,285 as of June 30, 2022 and December 31, 2021, respectively
+Added: Accounts receivable, net of allowances of $ 1,406 and $ 1,285 as of September 30, 2022 and December 31, 2021, respectively
+Added: Deferred tax assets
Intangible assets, net
Due from affiliates
−Removed: Deferred tax assets
Total other assets, net
−Removed: (1) In addition to the property we sold during the period, from time to time we may market to sell certain properties that are inconsistent with our long-term investment strategy.
+Added: (1) In addition to the properties we sold during the period, from time to time we may market to sell certain properties that are inconsistent with our long-term investment strategy.
At the end of each reporting period, we evaluate whether such properties meet the criteria to be classified as held for sale.
−Removed: As of June 30, 2022 , assets held for sale include one land parcel in Fort Lauderdale, Florida and two properties located in the Seattle, Washington area.
+Added: As of September 30, 2022 , assets held for sale include one land parcel in Fort Lauderdale, Florida, which is expected to be sold during the fourth quarter of 2022.
Accounting Pronouncements Adopted in the Current Year
−Removed: During the quarter ended March 31, 2022, we adopted ASU 2021-05 establishing Topic 842, Lessors - Certain Leases with Variable Lease Payments in conjunction with our ongoing operations.
−Removed: ASU 2021-05 requires a lessor to classify a lease with variable payments that do not depend on an index or rate as an operating lease if either a sales-type lease or direct finance lease classification would trigger a day-one loss, which was effective for us on January 1, 2022.
+Added: During the quarter ended March 31, 2022, we adopted ASU 2021-05 establishing Topic 842, Lessors - Certain Leases with Variable Lease Payments .
+Added: ASU 2021-05 requires a lessor to classify a lease with variable payments that do not depend on an index or rate as an operating lease if either a sales-type lease or direct finance lease classification would trigger a day-one loss.
The adoption of this standard on January 1, 2022 , did not have a material impact on our condensed consolidated financial statements.
9 unchanged sentences
We plan to adopt ASU 2020-04 and ASU 2021-01 when LIBOR is discontinued.
−Removed: We are currently evaluating the potential impact of adopting this guidance, but do not expect it to have a material impact on our consolidated financial statements due to the fact that we hold one month LIBOR debt instruments, which are not expected to be discontinued in 2022.
+Added: We are currently evaluating the potential impact of adopting this guidance, but do not expect it to have a material impact on our co nsolidated financial statements due to the fact that we hold one month LIBOR debt instruments, which are not expected to be discontinued in 2022.
Note 3 —Significant Transactions
Acquisitions and Investments
−Removed: During the quarter ended March 31, 2022, we entered into a short-term cancellable lease of and a purchase agreement to acquire, for $ 100.0 million, a nine -acre development site in the Flagler Village neighborhood of Fort Lauderdale, Florida.
+Added: In February 2022, we entered into a short-term cancellable lease of and a purchase agreement to acquire, for $ 100.0 million, a nine -acre development site in the Flagler Village neighborhood of Fort Lauderdale, Florida.
The site has the potential for the development of approximately three million square feet of mixed-use property, which could contain up to 1,500 residential units at full build-out.
−Removed: On June 2, 2022, we finalized the purchase of part of the site for $ 64.0 million.
−Removed: Subsequent to the closing, there was $ 7.2 million remaining in escrow in the seller's name and $ 28.8
−Removed: million in letters of credit held in escrow as reserved funds for the transaction.
−Removed: During the quarter ended June 30, 2022, we capitalized $ 2.8 million in fees as Land along with the closing.
−Removed: See Note 9 for further information.
−Removed: During the quarter ended March 31, 2022, o ur Fort Lauderdale consolidated joint venture closed on the acquisition of three undeveloped land parcels located in downtown Fort Lauderdale for $ 49.0 million ($ 25.0 million at Aimco's 51 % share), funded primarily by a $ 40.0 million land loan ($ 20.4 million at Aimco's share).
+Added: As of September 30, 2022, we had completed the $ 100.0 million purchase and recognized an additional $ 5.9 million of capitalized costs to Land in our Condensed Consolidated Balance Sheets.
+Added: In January 2022, our Fort Lauderdale consolidated joint venture closed on the acquisition of three undeveloped land parcels located in downtown Fort Lauderdale, Florida for $ 49.0 million ($ 25.0 million at Aimco's 51 % share), funded primarily by a $ 40.0 million land loan ($ 20.4 million at Aimco's share).
The cost was allocated among the parcels based on third-party appraisals.
−Removed: At the time of acquisition, one land parcel was subject to a sales agreement with closing expected on or before October 9, 2022.
−Removed: Based on the facts and circumstances related to the sale, we determined the land parcel met the criteria for classification as assets held for sale as of June 30, 2022.
+Added: At the time of acquisition, one land parcel was subject to a sales agreement with closing expected during the fourth quarter of 2022.
+Added: Based on the facts and circumstances related to the sale, we determined the land parcel met the criteria for classification as assets held for sale as of September 30, 2022.
These assets are reported at a carrying value of $ 11.7 million, and are included within Other assets, net in our Condensed Consolidated Balance Sheets .
−Removed: Liabilities related to these assets held for sale of $ 8.0 million are included in Accrued liabilities and other in our Condensed Consolidated Balance Sheets .
−Removed: During the quarter ended March 31, 2022, we funded the remaining $ 14.2 million of a total $ 50.0 million commitment of a passive equity investment in IQHQ Inc.
+Added: Liabilities related to these assets held for sale of $ 8.1 m illion are included in Accrued liabilities and other in our Condensed Consolidated Balance Sheets .
+Added: In February 2022, we funded the remaining $ 14.2 million of a total $ 50.0 million commitment of a passive equity investment in IQHQ Inc.
(IQHQ), a privately held life sciences real estate development company.
Based on certain facts and circumstances related to the investment, IQHQ was initially reported at cost.
−Removed: During the quarter ended June 30, 2022, 22 % of our original investment with a cost basis of $ 10.8 million was redeemed for $ 16.5 million.
−Removed: The redemption cash was received after quarter end.
−Removed: Consequently, we recognized a $ 5.7 million gain from this redemption in our Consolidated Statements of Operations for the three and six months ended June 30, 2022, and a $ 16.5 million receivable in our Condensed Consolidated Balance Sheets as of June 30, 2022.
−Removed: Further, our remaining investment in IQHQ with a cost basis of $ 39.2 million was valued at an estimated fair market value of $ 59.7 million, and a $ 20.5 million unrealized gain was recognized for the quarter ended June 30, 2022.
−Removed: Joint Venture Transaction
−Removed: In May 2022, we formed two joint ventures for a ground-up project that entails the construction of 574 residential homes and 20,000 square feet of mixed-use retail and cultural space in Bethesda, Maryland.
−Removed: Aimco holds a 50 % share of the joint ventures (the “DC joint ventures”), with a maximum total capital commitment of $ 18.0 million, of which $ 12.0 million has been funded as of June 30, 2022.
+Added: In June 2022, 22 % of our original investment with a cost basis of $ 10.8 million was redeemed for $ 16.5 million.
+Added: Consequently, we recognized a $ 5.7 million gain from this redemption, and the redemption cash was received in July 2022.
+Added: Further at that time, our remaining investment in IQHQ with a cost basis of $ 39.2 million was valued at an estimated fair market value of $ 59.7 million, and a $ 20.5 million unrealized gain was recognized .
+Added: Joint Venture Transactions
+Added: In May 2022, we formed two joint ventures for a ground up project on the development of a phased multifamily community totaling 574 units in Bethesda, Maryland.
+Added: We hold a 50 % share of the joint ventures (the “DC joint ventures”), with a maximum total initial capital commitment of $ 21.6 million, of which $ 13.4 milli on has been funded as of September 30, 2022.
We serve as co-development manager for these ventures, which are expected to begin construction in late 2023.
In March 2022, we formed a joint venture for the construction of approximately one million square feet of mixed-use development in the Edgewater neighborhood of Miami, Florida.
−Removed: Aimco holds a 20 % share of the joint venture ( the “Edgewater joint venture" ), which includes our initial contribution of an eighth of an acre of land that we purchased for $ 1.7 million in January 2022.
+Added: We hold a 20 % share of the joint venture ( the “Edgewater joint venture"), which includes our initial contribution of an eighth of an acre of land that we purchased for $ 1.7 million in January 2022 and cash of $ 0.3 million.
Our total capital commitment for this venture i s $ 8.0 million.
−Removed: We will serve as the development manager for this venture, which is expected to begin construction in 2023.
−Removed: In April 2022, we closed on the sale of our Pathfinder Village property located in Fremont, California, for a gross sales price of $ 127.0 million and recognized a gain from the sale of $ 94.6 million.
+Added: We will serve as the development manager for this project, which is expected to begin construction in 2023.
+Added: In July, we sold Cedar Rim, a 104 -unit apartment community located in Renton, Washington, for $ 53.0 million.
+Added: Cedar Rim was previously reported as held for sale.
+Added: In August, we sold 2900 on First, a 135 -unit apartment community with 14,000 square feet of retail located in Seattle, Washington for $ 69.0 million.
+Added: 2900 on First was previously reported as held for sale.
+Added: In May 2022, we closed on the sale of our Pathfinder Village property located in Fremont, California, for a gross sales price of $ 127.0 million and recognized a gain of $ 94.6 million.
Pathfinder Village was a stabilized property previously reported within our Operating segment.
Lease Arrangements
−Removed: In June 2022, we as lessee and AIR as lessor, entered into a lease termination agreement pursuant to which AIR is required to pay us a termination payment on September 1, 2022, and upon receipt of such payment, the existing leases with respect to four properties will terminate.
+Added: In September 2022, we as lessee, received final payment from AIR, pursuant to the lease termination agreement entered into in June 2022.
+Added: The leases with respect to four properties were terminated, and we relinquished control of these properties.
See Note 9 for further information .
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In connection with our development, redevelopment, and other capital additions activities, we have entered into various construction-related contracts, and have made commitments to complete development and redevelopment of certain real estate, pursuant to financing or other arrangements.
−Removed: As of June 30, 2022, our commitments related to these capital activities totaled approxima tely $ 188.4 million, most of which we expect to incur during the next 24 months.
−Removed: As described in Note 3 , we are under contract to acquire, for $ 36.0 million, the two remaining land parcels of a nine -acre development site in Fort Lauderdale.
−Removed: As of June 30, 2022, we reserved $ 7.2 million which was held in escrow in the seller’s name.
−Removed: As of June 30, 2022, our remaining commitment is $ 28.8 million, which we expect to incur over the next twelve months.
−Removed: As described in Note 3 , we have a commitment to fun d a total of $ 26.0 million for our Edgewater joint venture and DC joint ventures formed during 2022.
−Removed: As of June 30, 2022 , our remaining commitments are $ 12.0 million, which we expect to incur over the next twelve months.
−Removed: As of June 30, 2022, we have unfunded commitments in the amoun t of $ 2.9 m illion related to four investments in privately held entities that develop technology related to the real estate industry.
−Removed: The timing of these funding commitments is uncertain.
+Added: As of September 30, 2022, our commitments related to these capital activities totaled appr oximately $ 152.1 million, most of which we expect to incur during the next 24 months.
+Added: As described in Note 3 , we have joint venture commitments to fun d a total of $ 29.6 million for our Edgewater joint venture and DC joint ventures formed during 2022.
+Added: As of September 30, 2022 , we had $ 14.2 million of remaining commitments.
+Added: We expect to fund the remaining commitments over the next twelve months.
+Added: As of September 30, 2022, we have remaining commitments of $ 2.7 mi llion related to four investments in privately held entities that develop technology related to the real estate industry.
+Added: The timing of funding is uncertain.
We enter into certain commitments for future purchases of goods and services in connection with the operations of our apartment communities.
1 unchanged sentence
Legal Matters
−Removed: From time to time, we may be a party to certain legal proceedings, incidental to the normal course of business.
+Added: From time to time, we may be a party to certain legal proceedings.
While the outcome of the legal proceedings cannot be predicted with certainty, we believe there are no legal proceedings pending that would have a material effect upon our financial condition or results of operations.
3 unchanged sentences
Master Services Agreement
−Removed: We entered into a Master Services Agreement with AIR whereby AIR provides us with customary administrative and support services.
+Added: Under the Master Services Agreement with AIR, AIR provides us with customary administrative and support services.
We are obligated to pay AIR the fully burdened costs in performing those services.
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prior written notice, and AIR may terminate individual services at any time after December 31, 2023.
−Removed: During the three and six months ended June 30, 2022, we incurred administrative and supp ort fees of $ 0.5 million and $ 0.9 million, respectively, compared to $ 0.4 million and $ 0.8 million during the three and six months ended June 30, 2021, respectively.
+Added: During the three and nine months ended September 30, 2022, we incurred administrative and supp ort fees of $ 0.6 million and $ 1.5 million, respectively, compared to $ 0.7 million and $ 1.8 million during the three and nine months ended September 30, 2021, respectively.
These administrative support fees are included in General and administrative expenses in our Condensed Consolidated Statements of Operations .
Property Management Agreements
−Removed: We have entered into several Property Management Agreements with AIR, pursuant to which AIR provides us with certain property management, property accounting and related services for the majority of our operating properties.
−Removed: We pay AIR a property management fee for these services equal to 3 % of each respective property’s revenue collected and such other fees as may be mutually agreed upon for various other services.
+Added: Under the Property Management Agreements with AIR, AIR provides us with certain property management, property accounting and related services for the majority of our operating properties.
+Added: We pay AIR a property management fee equal to 3 % of each respective property’s revenue collected and such other fees as may be mutually agreed upon for various other services.
The initial term of each Property Management Agreement is one year, with automatic one-year renewal periods, unless either party elects to terminate upon delivery of 60 days’
−Removed: prior written notice to
−Removed: the other party before the end of the term.
−Removed: Neither party is obligated to pay to the other party a termination fee or other penalty upon such termination.
−Removed: During the three and six months ended June 30, 2022, we recognized property management and property accounting fe es of $ 1.5 mill ion and $ 2.9 million, respectively, compared to $ 1.3 million and $ 2.6 million during the three and six months ended June 30, 2021, respectively.
−Removed: These property management and property accounting fees are included in Property operating expenses in our Condensed Consolidated Statements of Operations .
+Added: prior written notice to the other party before the end of the term.
+Added: Neither party is obligated to pay a termination fee or other penalty upon such termination.
+Added: During the three and nine months ended September 30, 2022, we incurred property management and property accounting fees of $ 1.4 million and $ 4.1 million , respectively, compared to $ 1.3 million and $ 3.8 million during the three and nine months ended September 30, 2021, respectively.
+Added: These fees are included in Property operating expenses in our Condensed Consolidated Statements of Operations .
Master Leasing Agreement
The Master Leasing Agreement, as amended on June 14, 2022, governs the current and any future leasing arrangements between us, as lessee, and AIR, as lessor.
−Removed: Under the amendments to the Master Leasing Agreement, AIR's purchase option to acquire completed development and redevelopment properties was replaced with a right of first offer on development and redevelopment assets that have achieved stabilization after our acquisition of the asset and that we choose to bring to market within one year following stabilization.
−Removed: Additionally, it provides that each time the parties thereto wish to execute a new lease for a particular property, such parties will cause their applicable affiliates to execute a stand-alone lease.
−Removed: In June 2022, we as lessee and AIR as lessor, entered into a lease termination agreement pursuant to which AIR is required to pay us a termination payment on September 1, 2022, and upon receipt of such payment, the existing leases with respect to four properties will terminate.
+Added: Under the amendments to the Master Leasing Agreement, AIR's purchase option to acquire completed development and redevelopment properties was replaced with a right of first offer on development and
+Added: redevelopment assets that have achieved stabilization and that we choose to bring to market within one year thereafter.
+Added: Each time the parties wish to execute a new lease for a particular property, they will execute a stand-alone lease.
+Added: In September 2022, we received final payment from AIR, pursuant to the lease termination agreement entered into in June 2022.
+Added: The leases with respect to four properties were terminated, and we relinquished control of the associated properties.
See Note 9 for further information.
Notes Payable to AIR
−Removed: In June 2022, we entered into an agreement providing for early repayment of the Notes Payable to AIR relative to the original maturity date of such notes.
−Removed: The notes bore interest at 5.2 % with accrued interest payable on the first calendar day of each quarter.
−Removed: For the three and six months ended June 30, 2022 , we recognized interest expense related to the Notes Payable to AIR of $ 6.4 million and $ 13.3 million, respectively, compared to $ 6.9 million and $ 13.9 million during the three and six months ended June 30, 2021, respectively.
−Removed: Additionally, d uring the quarter ended June 30, 2022, we made a principal payment of $ 387.1 million, and recognized $ 17.9 million of associated spread maintenance costs, $ 12.9 million of which were paid as of June 30, 2022.
−Removed: In July 2022, we made the remaining principal and spread maintenance payments.
−Removed: In June 2022, for $ 7.2 million, we acquired from AIR the common noncontrolling interest in the entity that indirectly holds a portfolio of assets that secured the Notes Payable to AIR.
+Added: In July 2022, we completed the prepayment of the $ 534.1 million of Notes Payable to AIR.
+Added: As a result of the prepayment, we incurred $ 17.4 million of spread maintenance costs, which were fully accrued as of June 30, 2022.
+Added: For the three and nine months ended September 30, 2022 , we recognized interest expense on the Notes Payable to AIR of $ 0.4 million and $ 13.7 million, respectively, compared to $ 6.9 million and $ 20.8 million for the three and nine months ended September 30, 2021, respectively.
+Added: In June 2022, for $ 7.2 million, we acquired from AIR the common noncontrolling interest in the entity that indirectly holds a portfolio of assets that previously secured the Notes Payable to AIR.
Due to and from AIR
−Removed: As of June 30, 2022, we have amounts due to and from AIR of $ 16.2 million and $ 1.1 million, respectively.
+Added: As of September 30, 2022, we have amounts due to and from AIR of $ 6.7 m illion and $ 1.0 million, respectively.
As of December 31, 2021 we had amounts due to and from AIR of $ 15.7 million and $ 4.8 million, respectively.
−Removed: The amounts due to AIR primarily consist of invoices paid on our behalf and accrued interest on our Notes Payable to AIR.
+Added: The amounts due to AIR primarily consist of invoices paid on our behalf and other reimbursements owed to AIR.
The amounts due from AIR primarily consist of net cash flows generated by our operating properties.
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Considine for the calendar year 2022 under the terms of his employment agreement with AIR that are in excess of $ 1.0 million, collectively.
−Removed: As of June 30, 2022, we estimate the total 2022 reimbursement to AIR, pursuant to this arrangement, will be $ 4.0 m illion.
+Added: As of September 30, 2022, we estimate the total 2022 reimbursement to AIR, pursuant to this arrangement, will b e $ 4.5 m illion.
We estimate compensation associated with these arrangements to tota l $ 6.6 million for 2022.
−Removed: For the three and six months ended June 30, 2022, we recognized $ 1.5 million and $ 2.9 million of expense related to the arrangements, respectively, compared to $ 1.5 million and $ 2.9 million during the three and six months ended June 30, 2021, respectively.
+Added: For the three and nine months ended September 30, 2022, we recognized $ 1.7 million and $ 4.6 million of expense related to the arrangements, respectively, compared to $ 1.2 million and $ 4.1 million for the three and nine months ended September 30, 2021, respectively.
This expense is included in General and administrative expenses in our Condensed Consolidated Statements of Operations .
3 unchanged sentences
We calculate diluted earnings per share of common stock and diluted earnings per common unit taking into consideration dilutive shares of common stock and common partnership unit equivalents and dilutive convertible securities outstanding during the period.
−Removed: Each of our executives and AIR’s executives received one share of Aimco stock and one share of AIR stock at the Separation date for unvested shares.
+Added: Each of our executives and AIR’s executives received one unvested share of Aimco stock and one unvested share of AIR stock at the Separation date for each unvested share they held at that date.
We include AIR’s executives’
7 unchanged sentences
We include the effect of participating securities in basic and diluted earnings per share and unit computations using the two-class method of allocating distributed and undistributed earnings when the two-class method is more dilutive than the treasury stock method.
−Removed: Participating securities are included in the computation of diluted earnings per share for the three and six months ended June 30, 2022 and 2021, because their effects are dilutive.
−Removed: Reconciliations of the numerator and denominator in the calculations of basic and diluted earnings per share and per unit for the three and six months ended June 30, 2022 and 2021, are as follows (in thousands, except per share and per unit data):
−Removed: Three Months Ended June 30,
−Removed: Six Months Ended June 30,
+Added: Participating securities are included in the computation of diluted earnings per share for the three and nine months ended September 30, 2022 and 2021, because their effects are dilutive.
+Added: Reconciliations of the numerator and denominator in the calculations of basic and diluted earnings per share and per unit for the three and nine months ended September 30, 2022 and 2021, are as follows (in thousands, except per share and per unit data):
+Added: Three Months Ended
+Added: September 30,
+Added: Nine Months Ended
+Added: September 30,
Earnings per share
Net income (loss) attributable to Aimco
−Removed: Net income allocated to Aimco participating securities
+Added: Net income (loss) allocated to Aimco participating securities
Net income (loss) attributable to Aimco common stockholders
7 unchanged sentences
Net income (loss) attributable to Aimco Operating Partnership
−Removed: Net income allocated to Aimco Operating Partnership participating securities
−Removed: Net income (loss) attributable to Aimco Operating Partnership's common unitholders
+Added: Net income (loss) allocated to Aimco Operating Partnership participating securities
+Added: Net income (loss) attributable to Aimco Operating Partnership's common unit holders
Denominator - units
7 unchanged sentences
Recurring Fair Value Measurements
−Removed: In 2020, we paid an upfront premium of $ 12.1 million for the option to enter into a $ 1.5 billion notional amount interest rate swap at a future date.
−Removed: This interest rate option, or swaption, provides partial protection against exposure to rising interest rates between now and October 2024.
−Removed: We receive a cash settlement in the future if the prevailing interest rate is higher than the 1.68 % five-year swap strike price.
−Removed: The amount of future cash settlement is capped if the prevailing interest rate exceeds 2.78 %.
−Removed: Alternatively, if interest rates were to decrease below the specified strike price, we would not receive a cash settlement, nor would we have any requirement to make a payment.
−Removed: In 2021, we paid an upfront premium of $ 5.5 million for the option to enter into a $ 500.0 million notional amount interest rate swap at a future date.
−Removed: During the six months ended June 30, 2022, w e monetized our $ 500.0 million notional amount swaption for $ 13.7 million, and recognized a gain of $ 8.0 m illion, net of transaction costs.
−Removed: From time to time we purchase interest rate swaps, caps, and other instruments to provide protection against increases in interest rates on our floating rate debt.
−Removed: The fair value of these instruments are noted in the table below.
+Added: From time to time we purchase interest rate swaps, caps, and other instruments to provide protection against increases in interest rates on our variable rate debt.
+Added: As of September 30, 2022, we held interest rate swaps and caps with $ 1.7 billion notional value that provide protection through the fourth quarter of 2024.
+Added: These instruments were acquired for $ 15.7 million.
+Added: The fair value of these instruments is noted in the table below.
+Added: During the nine months ended September 30, 2022 , we monetized an interest rate swap and a portion of an interest rate cap for $ 15.5 million and recognized gains of $ 9.8 million, net of transaction costs.
On a recurring basis, we measure at fair value our interest rate options, which are presented in Other assets, net in our Condensed Consolidated Balance Sheets .
2 unchanged sentences
Changes in fair value are reflected as a non-cash transaction in adjustments to arrive at cash flows from operations, and any upfront premium is reflected in Purchase of interest rate options in our Condensed Consolidated Statements of Cash Flows .
−Removed: As of June 30, 2022, we have investments of $ 5.9 million in property technology funds consisting of entities that develop technology related to the real estate industry.
+Added: As of September 30, 2022, we have investments of $ 3.9 million in property technology funds consisting of entities that develop technology for the real estate industry.
These investments are measured at net asset value (“NAV”) as a practical expedient.
See Note 4 for further information.
−Removed: The following table summarizes fair value for our interest rate options and our investments in real estate technology funds as of June 30, 2022, and December 31, 2021, (in thousands):
−Removed: As of June 30, 2022
+Added: The following table summarizes fair value for our interest rate options and our investments in real estate technology funds as of September 30, 2022, and December 31, 2021 (in thousands):
+Added: As of September 30, 2022
As of December 31, 2021
3 unchanged sentences
Nonrecurring Fair Value Measurements
−Removed: As of June 30, 2022, assets measured at fair value on a nonrecurring basis in our Condensed Consolidated Balance Sheets consisted of our investment in IQHQ.
+Added: As of September 30, 2022, assets measured at fair value on a nonrecurring basis shown in our Condensed Consolidated Balance Sheets consisted of our investment in IQHQ.
IQHQ was initially reported at cost.
−Removed: During the quarter ended June 30, 2022, 22 % of our original investment with a cost basis of $ 10.8 million was redeemed for $ 16.5 million .
+Added: In June 2022, 22 % of our original investment with a cost basis of $ 10.8 million was redeemed for $ 16.5 million .
As a result, our remaining shares in IQHQ after the partial redemption were re-valued on a stepped up basis to fair value at the same per share value as the cash redemption per share value.
These observable inputs are classified as Level 1 within the GAAP fair value hierarchy.
−Removed: As of June 30, 2022, the fair value of our investment in IQHQ measured on a nonrecurring basis was $ 59.7 million.
+Added: As of September 30, 2022 , the fair value of our investment in IQHQ measured on a nonrecurring basis remained at $ 59.7 million.
Fair Value Disclosures
−Removed: We believe that the carrying value of the consolidated amounts of cash and cash equivalents, restricted cash, accounts receivable and payables approximated their fair value as of June 30, 2022, and December 31, 2021, due to their relatively short-term nature and high probability of realization.
−Removed: We estimate the fair value of our non-recourse property debt, construction loans, and Notes Payable to AIR using an income and market approach, including comparison of the contractual terms to observable and unobservable inputs such as market interest rate risk spreads, contractual interest rates, remaining periods to maturity, debt service coverage ratios, and loan to value ratios.
+Added: We believe that the carrying value of the consolidated amounts of cash and cash equivalents, restricted cash, accounts receivable and payables approximated their fair value as of September 30, 2022, and December 31, 2021 , due to their relatively short-term nature and high probability of realization.
+Added: We estimate the fair value of our debt using an income and market approach, including comparison of the contractual terms to observable and unobservable inputs such as market interest rate risk spreads, contractual interest rates, remaining periods to maturity, debt service coverage ratios, and loan to value ratios.
We classify the fair value of our non-recourse property debt and construction loans within Level 2 of the GAAP fair value hierarchy based on the significance of certain of the unobservable inputs used to estimate their fair value.
−Removed: The following table summarizes the carrying value and fair value of our non-recourse property debt, construction loans, and Notes Payable to AIR as of June 30, 2022, and December 31, 2021, (in thousands):
−Removed: As of June 30, 2022
+Added: As of July 2022, we had prepaid the $ 534.1 million of Notes Payable to AIR.
+Added: The following table summarizes the carrying value and fair value of our non-recourse property debt, construction loans, and Notes Payable to AIR as of September 30, 2022, and December 31, 2021, (in thousands):
+Added: As of September 30, 2022
As of December 31, 2021
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Substantially all of the assets and liabilities of Aimco are that of Aimco Operating Partnership.
−Removed: Aimco Operating Partnership is the primary beneficiary, and therefore consolidates our eight VIEs that own interests in real estate.
−Removed: In addition, we hav e nine unc onsolidated VIEs for which we are not the primary beneficiary because we are not their primary decision maker.
+Added: Aimco Operating Partnership is the primary beneficiary, and therefore consolidates our four VIEs that own interests in real estate.
+Added: In addition, we have nine unconsolidated VIEs for which we are not the primary beneficiary because we are not their primary decision maker.
The nine unconsolidated VIEs include four unconsolidated real estate partnerships that hold four apartment communities in San Diego, California, the Mezzanine Investment, our passive equity investment in IQHQ, our investment in the Edgewater joint venture, and our investments in the DC joint ventures.
−Removed: Details of our consolidated and unconsolidated VIEs, excluding those of Aimco Operating Partnership, are summarized in the table below as of June 30, 2022, and December 31, 2021, (in thousands, except for VIE count):
−Removed: June 30, 2022
+Added: Details of our consolidated and unconsolidated VIEs, excluding those of Aimco Operating Partnership, are summarized in the table below as of September 30, 2022, and December 31, 2021, (in thousands, except for VIE count):
+Added: September 30, 2022
December 31, 2021
5 unchanged sentences
Right-of-use lease assets
−Removed: Receivable from lease termination
Unconsolidated real estate partnerships
2 unchanged sentences
Accrued liabilities and other
+Added: Non-recourse property debt, net
Construction loans, net
1 unchanged sentence
Consolidated Real Estate Partnerships
−Removed: As of June 30, 2022, we acquired all of the outstanding redeemable non-controlling interests in an entity reported as a consolidated VIE as of December 31, 2021.
−Removed: The changes in consolidated VIE assets and liabilities from December 31, 2021 to June 30, 2022 in the table above are primarily due to the impact of:
−Removed: (i) the declassification of the entity described above as a VIE;
−Removed: (ii) the recognition of a receivable from lease termination of $ 186.3 million due to lease modifications;
−Removed: and (iii) the derecognition of right-of-use lease assets and lease liabilities of $ 326.1 million and $ 337.3 million, respectively, due to the lease modifications described in Note 3.
−Removed: As of June 30, 2022, one of our consolidated VIEs had an outstanding construction loan.
−Removed: In conjunction with this loan, we made customary guarantees.
−Removed: In certain situations, the loan's lenders may have recourse to our general credit.
−Removed: As of June 30, 2022, we estimate our maximum exposure equals the $ 134.0 million outstanding loan balance.
−Removed: Other consolidated VIEs' creditors do not have recourse to our general credit.
+Added: The changes in consolidated VIE assets and liabilities from December 31, 2021 to September 30, 2022 in the table above are primarily due to the impact of:
+Added: (i) In September 2022, we as lessee received final payment from AIR as lessor, pursuant to the lease termination agreement entered into in June 2022.
+Added: The leases with respect to four properties were terminated, and we relinquished control of the associated leasehold improvements and underlying land of these four properties.
+Added: Consequently, we derecognized $ 86.6 million real estate assets and a $ 138.4 million construction loan was paid off and derecognized as well.
+Added: In addition, we derecognized right-of-use
+Added: lease assets and lease liabilities of $ 326.1 million and $ 337.3 million, respectively, due to the lease modifications described in Note 9.
+Added: (ii) In February 2022, we acquired all of the outstanding redeemable non-controlling interests in an entity reported as a consolidated VIE as of December 31, 2021.
Unconsolidated Real Estate Partnerships
We own an interest in four unconsolidated real estate partnerships that hold four apartment communities in San Diego, California.
−Removed: We also own investments in the Edgewater joint venture to develop a 2.8-acre site in Miami's Edgewater neighborhood, and the DC joint ventures to develop a groun d-up and mixed-use retail and cultural space in Bethesda, Maryland.
−Removed: The joint ventures were formed during the six months ended June 30, 2022.
+Added: We also own investments in the Edgewater joint venture formed in March 2022 to develop a 2.8-acre site in Miami's Edgewater neighborhood, and the DC joint ventures formed in May 2022 to develop a ground-up phased multifamily community in Bethesda, Maryland.
See Note 3 for further information.
−Removed: Our investment balances of $ 27.1 million and $ 13.0 million as of June 30, 2022 and December 31, 2021, respectively, represented our maximum exposure to loss in these unconsolidated VIEs.
+Added: Our investment balances of $ 29.0 million and $ 13.0 million as of September 30, 2022 and December 31, 2021, respectively, represented our maximum exposure to loss in these unconsolidated VIEs.
Mezzanine Investment
AIR owns an interest in a partnership that owns Parkmerced Apartments, of which it is not the primary beneficiary, and under the terms of the Separation Agreement, AIR is obligated to transfer ownership of the subsidiaries that hold this interest to us upon receipt of required third-party consents.
−Removed: Our investment balances of $ 354.4 million an d $ 337.8 million as of June 30, 2022 and December 31, 2021 , respectively, represent our indirect interest in notes receivable through our agreement with AIR and our maximum exposure to loss in this VIE.
+Added: Our investment balances of $ 362.8 million and $ 337.8 million as of September 30, 2022 and December 31, 2021, respectively, represent our indirect interest in notes receivable through our agreement with AIR and our maximum exposure to loss in this VIE.
Note 9 —
3 unchanged sentences
We receive variable payments from our residents and commercial tenants primarily for utility reimbursements and other services.
−Removed: For the three and six months ended June 30, 2022 and 2021, our total lease income was comprised of the following amounts for all residential and commercial property leases (in thousands):
−Removed: Three Months Ended June 30,
−Removed: Six Months Ended June 30,
+Added: For the three and nine months ended September 30, 2022 and 2021, our total lease income was comprised of the following amounts for all residential and commercial property leases (in thousands):
+Added: Three Months Ended September 30,
+Added: Nine Months Ended
+Added: September 30,
Fixed lease income
5 unchanged sentences
These lease arrangements are governed by separate Master Lease Agreements and the Master Leasing Agreement.
−Removed: In June 2022, we as lessee and AIR as lessor, entered into a lease termination agreement with respect to the four leases entered into on January 1, 2021.
−Removed: This agreement terminates the four finance leases on September 1, 2022.
−Removed: Upon termination, both parties shall be released of any and all liabilities and obligations under each respective lease other than those liabilities and obligations, if any, that expressly survive termination.
−Removed: On September 1, 2022 we will relinquish control of the leasehold improvements on these four leased properties as well as the underlying land.
−Removed: In exchange, AIR will transfer a total of $ 200.0 million in consideration to us as termination payments.
−Removed: On June 28, 2022, AIR made a $ 10.0 million non-refundable termination deposit with the remaining $ 190.0 million to be paid by AIR on September 1, 2022, both termination payments are accounted for as lease incentives.
−Removed: Based on the present value of the termination payments, net of remaining lease payments, we reduced the lease liability to zero and recorded a receivable from lease termination of $ 186.3 million in our Condensed Consolidated Balance Sheets at June 30, 2022.
−Removed: Because the termination agreement modified the expiration date of each lease to September 1, 2022, we accelerated depreciation on the associated leasehold improvements using lease terms ending September 1, 2022.
−Removed: We recorded $ 13.9 million of additional depreciation expense in our Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2022.
−Removed: The remaining $ 66.1 million of depreciation expense will be recognized in the third quarter.
−Removed: In addition, we reduced the associated right-of-use lease assets to zero and recognized lease modification income of $ 205.4 million, which is included in our Condensed Consolidated Statements of Operations for the periods ended June 30, 2022.
+Added: In June 2022, we as lessee and AIR as lessor, entered into a lease termination agreement with respect to four leases entered into on January 1, 2021 that pertained to our North Tower of Flamingo Point, 707 Leahy, The Fremont, and Prism properties .
+Added: This agreement terminated the four finance leases on September 1, 2022.
+Added: Upon termination, both parties were released of any and all liabilities and obligations under each respective lease other than those liabilities and obligations, if any, that expressly survived termination.
+Added: On September 1, 2022, we relinquished control of the leasehold improvements on these four properties as well as the underlying land.
+Added: In exchange, AIR remitted a total o f $ 200.0 m illion in consideration to us as termination payments.
+Added: Because the termination agreement modified the expiration date of each lease to September 1, 2022, we accelerated depreciation on the associated leasehold improvements using lease terms that ended September 1, 2022.
+Added: We recorded $ 69.9 million and $ 85.7 million of total d epreciation expense for the three and nine months ended September 30, 2022, respectively.
+Added: In addition, we recognized Lease modification income of $ 1.6 million and $ 207.0 million, which is included in our Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2022, respectively.
Ground Leases
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Other Finance Lease Arrangements
−Removed: As described in Note 3 , during the quarter ended March 31, 2022, we, as lessee, entered into certain finance lease arrangements concurrent with a contract to acquire a development site in Fort Lauderdale.
−Removed: At lease inception, $ 20.0 million in deposits were placed in the seller’s name, which subsequently reduced the finance lease liability.
−Removed: The related interest is capitalized as part of the finance right-of-use lease assets.
−Removed: In June 2022, we purchased a part of the aforementioned development site in Fort Lauderdale for $ 64.0 million.
−Removed: As a result of the purchase, we derecognized the associated right-of-use lease assets and lease liabilities, and recorded the difference to land .
−Removed: As of June 30, 2022 , the remaining right-of-use lease assets and lease liabilities associated with the other parts totaled $ 34.8 million and $ 26.3 million, respectively.
−Removed: See Note 3 for further information.
−Removed: Together, as of June 30, 2022 and December 31, 2021, these finance leases had weighted-average remaining terms of 74.8 years and 38.5 years, respectively, and weighted-average discount rates of 5.5 % and 5.4 %, respectively.
−Removed: As of June 30, 2022 , finance lease right-of-use lease assets and liabilities totaled $ 130.5 million and $ 123.8 million, respectively.
+Added: As described in Note 3 , in February 2022, we, as lessee, entered into certain finance lease arrangements concurrent with a purchase agreement to acquire a development site in the Flagler Village neighborhood of Fort Lauderdale, Florida.
+Added: As of September 30, 2022, we had completed the $ 100.0 million purchase and recognized an additional $ 5.9 million of capitalized costs to Land in our Condensed Consolidated Balance Sheets.
+Added: See Note 3 for additional information.
+Added: As of September 30, 2022 and December 31, 2021, our finance leases had weighted-average remaining terms of 93.9 years and 38.5 years, respectively, and weighted-average discount rates of 6.0 % and 5.4 %, respectively.
+Added: As of September 30, 2022 , finance lease right-of-use lease assets and liabilities totaled $ 95.5 million and $ 98.5 million, respectively.
As of December 31, 2021 , finance right-of-use lease assets and liabilitie s totaled $ 429.8 million and $ 435.1 million, r espectively.
−Removed: For the three and six months ended June 30, 2022, amortization related to finance leases was $ 3.4 million and $ 6.7 million, respectively, net of amounts capitalized, compared to $ 2.1 million and $ 3.4 million for the three and six months ended June 30, 2021, respectively.
−Removed: For the three and six months ended June 30, 2022, we capitalized $ 1.8 million and $ 4.8 mil lion, respectively, of lease costs associated with active development and redevelopment projects on certain of the underlying property and ground lease assets, compared to $ 5.8 million and $ 12.7 million, respectively, for three and six months ended June 30, 2021.
+Added: For the three and nine months ended September 30, 2022, amortization related to finance leases was $ 0.0 million and $ 6.7 million, respectively, net of amounts capitalized, compared to $ 2.1 million and $ 5.5 million for the three and nine months ended September 30, 2021, respectively.
+Added: For the three and nine months ended September 30, 2022, we capitalized $ 1.7 million and $ 6.5 million, respectively, of lease costs associated with active development and redevelopment projects on certain of the underlying property and ground lease assets, compared to $ 5.8 million and $ 18.5 m illion, respectively, for three and nine months ended September 30, 2021.
Operating Lease Arrangements
We have operating leases primarily for corporate office space.
−Removed: As of June 30, 2022 and December 31, 2021, our operating leases had weighted-average remaining terms of 7.1 years and 7.4 years, respectively.
−Removed: As of June 30, 2022 and December 31, 2021, the leases had weighted-average discount rates of 3.1 % , a nd 3.1 %, re spectively.
+Added: As of September 30, 2022 and December 31, 2021, our operating leases had weighted-average remaining terms of 6.6 years and 7.4 years, respectively.
+Added: As of September 30, 2022 and December 31, 2021, the leases had weighted-average discount rates of 3.1 % , an d 3.1 %, re spectively.
We record operating lease expense on a straight-line basis over the lease term.
−Removed: Total operating lease expense for the three and six months ended June 30, 2022 wa s $ 0.2 million and $ 0.3 million, re spectively, compared to $ 0.3 million and $ 0.5 million for the three and six months ended June 30, 2021, respectively.
−Removed: As of June 30, 2022 and December 31, 2021, operating lease right-of-use lease assets of $ 4.7 million and $ 5.1 million, respectively, are included in O ther assets, net in our Condensed Consolidated Balance Sheets .
−Removed: As of June 30, 2022 and December 31, 2021, operating lease liabilities of $ 12.0 million and $ 12.7 m illion, respectively, are included in A ccrued liabilities and other in our Condensed Consolidated Balance Sheets .
+Added: Total operating lease expense for the three and nine months ended September 30, 2022 wa s $ 0.2 million and $ 0.5 million, respectively, compared to $ 0.2 million and $ 0.5 million for the three and nine months ended September 30, 2021, respectively.
+Added: As of September 30, 2022 and December 31, 2021, operating lease right-of-use lease assets of $ 4.6 million and $ 5.1 million, respectively, are included in O ther assets, net in our Condensed Consolidated Balance Sheets .
+Added: As of September 30, 2022 and December 31, 2021, operating lease liabilities of $ 11.6 million and $ 12.7 m illion, respectively, are included in A ccrued liabilities and other in our Condensed Consolidated Balance Sheets .
For finance and operating leases, when the rate implicit in the lease cannot be determined, we estimate the value of our lease liabilities using discount rates equivalent to the rates we would pay on a secured borrowing with terms similar to the leases.
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Our Other segment consists of properties that are not included in our Development and Redevelopment or Operating segments.
−Removed: Our chief operating decision maker (“CODM”) uses cash flow, construction timeline to completion, and actual versus budgeted results to evaluate our properties in our Development and Redevelopment segment.
+Added: During the nine months ended September 30, 2022 we disposed of two Seattle, Washington area properties that had previously been reported as held for sale assets and one stabilized property located in Fremont, CA that was previously reported within our Operating segment.
+Added: In addition, we terminated the leases for four residential apartment communities that were previously reported within our Development and Redevelopment segment.
+Added: Prior period segment information has been recast based upon our current segment population and is consistent with how our chief operating decision maker ("CODM") evaluates the business.
+Added: The recast conforms with our reportable segment composition as of September 30, 2022.
+Added: Our CODM uses cash flow, construction timeline to completion, and actual versus budgeted results to evaluate our properties in our Development and Redevelopment segment.
Our CODM uses proportionate property net operating income to assess the operating performance of our Operating segment.
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In our Condensed Consolidated Statements of Operations , utility reimbursements are included in Rental and other property revenues , in accordance with GAAP.
−Removed: As of June 30, 2022, our Development and Redevelopment segment consists of 14 properties:
−Removed: two residential apartment communities with 965 planned apartment homes, a single family rental community with 16 pla nned homes plus eight accessory dwelling units, and one hotel, with 106 planned rooms, we are actively developing or redeveloping;
−Removed: four residential apartment communities with 865 apartment homes for which we have completed the redevelopment, but have not achieved stabilization;
+Added: As of September 30, 2022, our Development and Redevelopment segment consists of 10 properties:
+Added: two residential apartment communities with 965 planned apartment homes, a single family rental community with 16 planned homes plus eight accessory dwelling units, and one hotel, with 106 planned rooms, we are actively developing or redeveloping;
and, land parcels held for development.
Our Operating segment includes 21 consolidated apartment communities with 5,582 apartment homes.
−Removed: Our Other segment includes our recent Eldridge Townhomes acquisition, stabilized but not owned for the comparable reporting period, and 1001 Brickell Bay Drive, our only office building.
−Removed: The following tables present the results of operations of consolidated properties with our segments reported on a proportionate basis for the three months ended June 30, 2022 and 2021 (in thousands):
+Added: Our Other segment includes Eldridge Townhomes apartment community, stabilized but not owned for the comparable reporting period, and 1001 Brickell Bay Drive, our only office building.
+Added: The following tables present the results of operations of consolidated properties with our segments reported on a proportionate basis for the three months ended September 30, 2022 and 2021 (in thousands):
Development and Redevelopment
−Removed: Proportionate and Other Adjustments (1)
+Added: Proportionate
+Added: and Other Adjustments (1)
Corporate and Amounts Not Allocated to Segments (2)
−Removed: Three Months Ended June 30, 2022:
+Added: Three Months Ended September 30, 2022:
Rental and other property revenues
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Development and Redevelopment
−Removed: Proportionate and Other Adjustments (1)
+Added: Proportionate
+Added: and Other Adjustments (1)
Corporate and Amounts Not Allocated to Segments (2)
−Removed: Three Months Ended June 30, 2021:
+Added: Three Months Ended September 30, 2021:
Rental and other property revenues
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Income (loss) before income tax
−Removed: The following tables present the results of operations of consolidated properties with our segments reported on a proportionate basis for the six months ended June 30, 2022 and 2021 (in thousands):
+Added: The following tables present the results of operations of consolidated properties with our segments reported on a proportionate basis for the nine months ended September 30, 2022 and 2021 (in thousands):
Development and Redevelopment
−Removed: Proportionate and Other Adjustments (1)
−Removed: Corporate and
−Removed: Six Months Ended June 30, 2022:
+Added: Proportionate
+Added: and Other Adjustments (1)
+Added: Corporate and Amounts Not Allocated to Segments (2)
+Added: Nine Months Ended September 30, 2022:
Rental and other property revenues
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Proportionate and Other Adjustments (1)
−Removed: Corporate and
−Removed: Six Months Ended June 30, 2021:
+Added: Corporate and Amounts Not Allocated to Segments (2)
+Added: Nine Months Ended September 30, 2021:
Rental and other property revenues
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Utility reimbursements are included in Rental and other property revenues in our Condensed Consolidated Statements of Operations prepared in accordance with GAAP.
+Added: (2) Includes the operating results of apartment communities sold during the periods shown or held for sale at the end of the period, if any.
+Added: Also includes property management expenses and casualty gains and losses, which are included in consolidated property operating expenses and are not part of our segment performance measure.
(3) Other operating expenses not allocated to segments consist of depreciation and amortization, general and administrative expense, and miscellaneous other expenses.
(4) Other items included in Income before income tax benefit consist primarily of interest expense, gain on our interest rate options, gain on sale of Real Estate, lease modification income and mezzanine investment income, net.
−Removed: Net real estate and non-recourse property debt, net, of our segments as of June 30, 2022 and December 31, 2021, were as follows (in thousands):
+Added: Net real estate and non-recourse property debt, net, of our segments as of September 30, 2022 and December 31, 2021, were as follows (in thousands):
Development and Redevelopment
Corporate (1)
−Removed: As of June 30, 2022:
+Added: As of September 30, 2022:
Buildings and improvements
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Non-recourse property debt, net
−Removed: (1) During the six months ended June 30, 2022, certain properties were sold or reclassified as Held for Sale, and therefore are not included in our segment balance sheets, as of June 30, 2022.
+Added: (1) During the nine months ended September 30, 2022, certain properties were sold or reclassified as Held for Sale, and therefore are not included in our segment balance sheets, as of September 30, 2022 .
We added a new Corporate segment to this table for presentation purposes to display these assets and the associated debt as of December 31, 2021.
−Removed: In addition to the amounts disclosed in the tables above, as of June 30, 2022 the Development and Redevelopment segment right-of-use lease assets and lease liabilities aggregated to $ 130.5 million and $ 123.8 million, respectively, and as of December 31, 2021, aggregated to $ 429.8 million and $ 435.1 million, respectively.
−Removed: As of June 30, 2022, right-of-use lease assets and lease liabilities primarily relate to our investments in Upton Place and Oak Shore.
+Added: In addition to the amounts disclosed in the tables above, as of September 30, 2022 the Development and Redevelopment segment right-of-use lease assets and lease liabilities aggregated to $ 95.5 million and $ 98.5 million, respectively, and as of December 31, 2021, aggregated to $ 429.8 million and $ 435.1 million, respectively.
+Added: As of September 30, 2022, right-of-use lease assets and lease liabilities primarily relate to our investments in Upton Place and Oak Shore.
As described in Note 9, we entered into termination agreements to cancel our leases on North Tower of Flamingo Point, 707 Leahy, The Fremont, and Prism on September 1, 2022.
−Removed: Consequently, during the period ended June 30, 2022 , we wrote off $ 326.1 million and $ 337.3 million right-of-use lease assets and lease liability, respectively.
−Removed: Additionally, we purchased a land parcel for $ 64.0 million and terminated the certain lease component on Flagler Village and derecognized associated right-of-use lease assets and lease liabilities of $ 60.5 million and $ 46.7 million, respectively.
+Added: Consequently, during the period ended September 30, 2022 , we wrote off $ 326.1 million and $ 337.3 million right-of-use lease assets and lease liability, respectively.
Note 11 –
Financing Activities
−Removed: In May 2022, we entered into 14 long term, fixed rate, non-recourse property loans that totaled $ 574.7 million.
−Removed: This non-recourse debt has a weighted-average term of 9.4 years and a weighted-average interest rate of 4.63 %.
+Added: Our outstanding indebtedness as of September 30, 2022 includes the following borrowings that closed during the nine months ended September 30, 2022 (in thousands):
+Added: September 30, 2022
+Added: Contractual Interest Rate
+Added: Maturity Date
+Added: Variable-Rate:
+Added: Variable property loans
+Added: Construction loan
+Added: One-Month SOFR+ 4.41 % (min 5.56 %)
+Added: June 2025 (2)
+Added: Non-recourse property loans
+Added: (1) Includes two variable rate property loans for $ 60.0 million and $ 40.0 million, respectively.
+Added: The $ 60.0 million loan has an original maturity date of August 2024 , with an option to extend the loan term one additional year to August 2025 .
+Added: Total debt issuance costs for this loan of approximately $ 1.5 million have been deferred, and this loan bears an interest rate based on the One-Month SOFR plus a 6.75 % spread with an all in minimum interest rate of 8.00 %.
+Added: The $ 40.0 million loan has an original maturity date of January 2024 , with two options to extend the loan term for six month periods to July 2024 and January 2025 .
+Added: This loan bears an interest rate based on One-Month SOFR plus a 6.45 % spread with an all in minimum interest rate of 6.50 %.
+Added: (2) The Construction Loan includes an option to extend the maturity one additional year to August 2025 .
Total debt issuance costs of approximately $ 1.2 million have been deferred.
−Removed: In addition, we incurred $ 7.4 million in prepayment costs associated with the extinguishment of six loans.
−Removed: In June 2022, we entered into a construction loan for up to $ 23.0 million in financing to fund the Oak Shore project.
−Removed: The loan has a term of 36 months with an option to extend for two additional one year periods, and an interest rate based on the One-Month Term SOFR plus a spread of 4.41 %, subject to a minimum all-in interest rate of 5.56 %.
−Removed: In June 2022, we entered into an agreement for the modification and early repayment of our Notes Payable to AIR.
−Removed: During the quarter ended June 30, 2022, we made a principal payment of $ 387.1 million, and recognized $ 17.9 million of associated spread maintenance costs, $ 12.9 million of which were paid as of June 30, 2022.
−Removed: See Note 5 for further information.
−Removed: During the six months ended June 30, 2022 , we monetized our $ 500.0 million notional amount interest rate swaption for $ 13.7 million and recognized a gain of $ 8.0 million, which is included in Realized and unrealized gains (losses) on interest rate options in our Condensed Consolidated Statements of Operations for the periods ended June 30, 2022.
+Added: (3) Includes 14 long term, fixed rate, non-recourse property loans with a weighted-average term of 9.4 years and a weighted average interest rate of 4.63 %.
+Added: Total debt issuance costs of approximately $ 5.4 million have been deferred.
Note 12 –
Subsequent Events
−Removed: Subsequent to June 30, 2022, we purchased the remaining two land parcels of our Flagler Village neighborhood development site in Fort Lauderdale, Florida for $ 20.0 and $ 16.0 million.
−Removed: In July 2022, we sold our Cedar Rim Apartments property located in King County, Washington for $ 53.0 million.
−Removed: Cedar Rim was classified as a held for sale asset in the second quarter of 2022.
−Removed: In July 2022, we closed a preferred equity financing arrangement with an institutional equity investor for $ 102.0 million, accruing at a fixed 8.0 % interest rate, related to a portfolio of stabilized assets.
−Removed: In July 2022, we made the remaining principal and spread maintenance payments on our Notes Payable to AIR of $ 147.0 and $ 5.0 million.
+Added: In October 2022, we entered into an $ 81.3 million non-recourse property loan with an initial term of 36 months, extendable for two additional one year periods, and with an interest rate based on the sum of the One-Month Term SOFR plus a spread of 4.5 %, subject to a minimum all-in interest rate of 6.0 %.
+Added: Concurrently, we paid a $ 1.5 million premium to enter an $ 81.3 million notional amount interest rate cap agreement, which caps the One-Month Term SOFR at 3.5 %.
MANAGEMENT’S DISCUSSION AND ANALYSIS O F FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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and our ability to comply with debt covenants, including financial coverage ratios;
+Added: and the outcome and consequences of the current proxy contest with Land & Buildings Capital Growth, L.P.("Land & Buildings").
These forward-looking statements are based on management’s judgment as of this date, which is subject to risks and uncertainties that could cause actual results to differ materially from our expectations, including, but not limited to:
the effects of the coronavirus pandemic on Aimco’s business and on the global and U.S.
−Removed: economies generally, and the ongoing, dynamic and uncertain nature and duration of the pandemic, geopolitical events which may adversely affect the markets in which our securities trade, and other macroeconomic conditions, including, among other things, supply chain challenges and rising interest rates, all of which heightens the impact of the other risks and factors described herein, and the impact on entities in which Aimco holds a partial interest, including its indirect interest in the partnership that owns Parkmerced Apartments, and the impact of coronavirus related governmental lockdowns on Aimco’s residents, commercial tenants, and operations;
+Added: economies generally, and the ongoing, dynamic and uncertain nature and duration of the pandemic, geopolitical events which may adversely affect the markets in which our securities trade, and other macroeconomic conditions, including, among other things, supply chain challenges and rising interest rates, all of which heightens the impact of the other risks and factors
+Added: described herein, and the impact on entities in which Aimco holds a partial interest, including its indirect interest in the partnership that owns Parkmerced Apartments, and the impact of coronavirus related governmental lockdowns on Aimco’s residents, commercial tenants, and operations;
real estate and operating risks, including fluctuations in real estate values and the general economic climate in the markets in which we operate and competition for residents in such markets;
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and the ability to achieve some or all the benefits that we expect to achieve from the Separation;
+Added: the outcome and consequences of activist stockholders on our business;
and such other risks and uncertainties described from time to time in our filings with the Securities and Exchange Commission (“SEC”).
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Our mission is to make real estate investments, primarily focused on the multifamily sector within the continental United States, where outcomes are enhanced through our human capital so that substantial value is created for investors, teammates, and the communities in which we operate.
−Removed: Our value proposition includes our national platform organized around four regional and two satellite offices, consisting of a cohesive, talented, and tenured team and our proven investment process;
−Removed: a diversified portfolio, consisting of high-performing in-process value-add investments, a deep and growing pipeline, alternative investments, and stabilized assets;
−Removed: and our capital redeployment plan of reallocating our equity to higher returning investments and prudent recycling of capital.
+Added: Our value proposition includes our:
+Added: Platform, consisting of a cohesive and talented leadership team with an average Aimco tenure of over 10 years and nearly 20 years of diverse real estate industry experience combined with a disciplined and proven investment process;
+Added: Diversified portfolio, consisting of high-performing in-process value-add investments, a deep pipeline that has nearly tripled since the Separation with a total potential of more than 15 million square feet, alternative investments, and a portfolio of stabilized real estate to provide risk management and produce predictable cash flow;
+Added: Capital redeployment plan of reallocating our equity to higher returning investments and prudent recycling of capital.
Our primary goal is outsized risk adjusted returns and accelerating growth for our shareholders.
−Removed: We have a talented leadership team with an average Aimco tenure of over 10 years and nearly 20 years of diverse real estate industry experience combined with a disciplined and proven investment process.
−Removed: We benefit from a deep and growing investment pipeline with $1.0 billion of development and redevelopment projects currently underway, over $2.5 billion of future opportunities under Aimco-control and more being explored.
−Removed: We add to this alternative investment strategies and a diversified portfolio of stabilized real estate to provide risk management and produce predictable cash flow.
−Removed: We have more than $500.0 million of equity targeted for redeployment into high returning activities over the next 4-5 years offering investors a high performing, high return vehicle with expected annualized returns on equity from 12-16% once optimal capital allocation is achieved.
We are focused on providing superior total-return performance to shareholders, primarily through capital appreciation driven by accretive investment and active portfolio management over multi-year periods.
6 unchanged sentences
multifamily real estate.
−Removed: From time to time, we will allocate a defined portion of our capital into alternative investments including passive debt and equity investments (both direct and indirect).
+Added: From time to time, we expect to allocate a limited/small portion of our capital to passive debt and equity investments, both directly and indirectly.
We may also utilize our established platform and existing relationships to generate fees through service offerings.
−Removed: We have policies in place that support our strategy, guide our investment allocations, and manage risk, including to hold at all times a sizeable portion of its net equity in a diversified portfolio of “Core”
+Added: We have policies in place that support our strategy, guide our investment allocations, and manage risk, including to hold at all times a sizeable portion of our net equity in a diversified portfolio of “Core”
and “Core-Plus”
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Over time, we expect the Aimco enterprise to produce superior returns on equity on a risk-adjusted basis and it is our plan to do so by:
−Removed: Benefiting from a national platform while leveraging local and regional expertise
+Added: Benefiting from a platform that leverages local and regional expertise
We have corporate headquarters in Denver, Colorado and Bethesda, Maryland.
3 unchanged sentences
Managing and investing in value-add and opportunistic real estate
−Removed: Our dedicated team will source and execute development and redevelopment projects, and various other direct investment strategies, across our national platform.
−Removed: The Aimco Development and Redevelopment portfolio currently includes $1.0 billion of projects in construction and lease-up, located across five major U.S.
−Removed: In addition, we currently have over $2.5 billion worth of pipeline opportunities under our control and have the opportunity to add to our investment pipeline based on strategic relationships and through sourcing by regional investment teams.
+Added: Our dedicated team will source and execute development and redevelopment projects, and various other direct investment strategies.
+Added: The Aimco development and redevelopment portfolio currently includes $0.6 billion of projects in construction and lease-up.
+Added: In addition, since the Separation, our team has secured significant, high-quality, future development opportunities, more than tripling Aimco’s controlled pipeline to a total potential of more than 15 million square feet, located in high-growth markets.
Generally, we seek direct investment opportunities in locations where barriers to entry are high, target customers can be clearly defined and where we have a comparative advantage over others in the market.
+Added: Owning a portfolio of stabilized core and core plus real estate
+Added: Our entire portfolio of operating properties includes 26 apartment communities (22 consolidated properties and four unconsolidated properties) with average rents in line with local market averages (generally defined as B class).
+Added: We also own one commercial office building that is part of an assemblage with an adjacent apartment building.
+Added: The target composition of our stabilized portfolio will continue to include primarily B multifamily assets, spread across a geographically diversified portfolio and with a bias toward long established residential neighborhoods that rank highly in regard to schools, employment fundamentals and state and regional governance.
+Added: Core-Plus opportunities offer the opportunity for incremental capital investment while maintaining stabilized cashflow to accelerate income growth and improve asset values.
Managing and investing in other alternative investments
+Added: We expect to allocate a limited portion of our capital to passive debt and equity investments, both directly and at the entity level when warranted by risk adjusted returns.
Our current allocation to alternative investments includes:
1 unchanged sentence
(“IQHQ”), a privately held life sciences real estate development company, and in property technology funds consisting of entities that develop technology related to the real estate industry.
−Removed: We expect to allocate a portion of our capital to passive debt and equity investments, both directly and at the entity level.
−Removed: These prove attractive when warranted by risk adjusted returns, when we have special knowledge or expertise relevant to the particular investment or when the opportunity exists for positive asymmetric outcomes whether through strategic partnerships or otherwise.
−Removed: In addition, from time to time, we will use our established platform and existing relationships to generate fees through service offerings to third-party real estate investors, owners, and capital allocators.
−Removed: Owning a portfolio of stabilized core and core plus real estate
−Removed: Our entire portfolio of operating properties includes 28 apartment communities (24 consolidated properties and four unconsolidated properties) located in ten major U.S.
−Removed: markets and with average rents in line with local market averages (generally defined as B class).
−Removed: We also own one commercial office building that is part of an assemblage with an adjacent apartment building.
−Removed: The target composition of our stabilized portfolio will continue to include primarily B multifamily assets, spread across a nationally diversified portfolio and with a bias toward long established residential neighborhoods that rank highly in regard to schools, employment fundamentals and state and regional governance.
−Removed: Core-Plus opportunities offer the opportunity for incremental capital investment while maintaining stabilized cashflow to accelerate income growth and improve asset values.
Maintaining sufficient liquidity and utilizing safe financial leverage
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When warranted, we plan to seek equity capital from joint venture partners to improve our cost of capital, further leverage Aimco equity, reduce exposure to a single investment and, in certain cases, for strategic benefits.
−Removed: The results from the execution of our business plan during the three and six months ended June 30, 2022 are further described below.
+Added: The results from the execution of our business plan during the three and nine months ended September 30, 2022 are further described below.
Financial Results and Recent Highlights
−Removed: Net income per share attributable to Aimco, on a fully dilutive basis, was $1.57 for the three months ended June 30, 2022, compared to a loss of ($0.13) for the three months ended June 30, 2021, due primarily to the recognition of income resulting from the agreement to terminate the AIR leases and gains related to the sale of Pathfinder Village.
−Removed: Net income per share attributable to Aimco, on a fully dilutive basis was $1.65 for the six months ended June 30, 2022, compared to net income per share of $0.00 for the six months ended June 30, 2021.
−Removed: For the three months ended June 30, 2022, revenue and net operating income from our Operating Properties were up 11.2% and 14.4%, respectively, year over year, with occupancy of 97.7%, up 20 basis points year over year.
−Removed: We reached an agreement with AIR to terminate four leases on September 1, 2022 that will result in more than $100 million of realized value creation (net of costs) for Aimco shareholders and eliminate $469 million of obligations related to the four leased properties.
−Removed: In July 2022, we completed the early repayment of the $534 million of Notes Payable to AIR, originally scheduled to mature in January 2024 and carrying an annual rate of 5.2% with proceeds from property level financings, the sale of Pathfinder Village, and the placement of preferred equity secured by a portfolio of stabilized properties.
+Added: Net income per share attributable to Aimco, on a fully dilutive basis, was $0.19 for the three months ended September 30, 2022, compared to a loss of ($0.03) for the three months ended September 30, 2021, due primarily to gains related to dispositions of real estate.
+Added: Net income per share attributable to Aimco, on a fully dilutive basis was $1.81 for the nine months ended September 30, 2022, compared to a loss of ($0.03) for the nine months ended September 30, 2021, due primarily to lease modification income and gains related to the dispositions of real estate.
+Added: For the three months ended September 30, 2022, revenue and net operating income from our Operating Properties were up 11.5% and 17.5%, respectively, year over year, with average monthly revenue per apartment home of $2,173, up $261 year over year, and average daily occupancy of 96.0%, down 190 basis points year over year.
+Added: In September 2022, we as lessee and AIR as lessor, closed the previously announced $669 million lease termination transaction with respect to four leases entered into on January 1, 2021 that pertained to our North Tower of Flamingo Point, 707 Leahy, The Fremont, and Prism properties.
+Added: This transaction terminated the four leases on September 1, 2022 eliminating $469 million of obligations related to the four leased properties.
+Added: In exchange we received a payment of $200 million.
+Added: Our execution in the development and lease-up of these assets resulted in more than $100 million of realized value creation (net of costs) for Aimco shareholders.
+Added: In July 2022, we paid $147.0 million to complete the prepayment of the $534.1 million of Notes Payable to AIR.
+Added: In July and August 2022, we closed on the sales of two apartment communities, exiting the greater Seattle market for $122.0 million.
Value Add, Opportunistic & Alternative Investments
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Our Value Add and Opportunistic investments may also target portfolio acquisitions, operational turnarounds, and re-entitlements.
−Removed: We currently have eight active development and redevelopment projects, located across five U.S.
+Added: We currently have four active development and redevelopment projects, located across four U.S.
markets, in varying phases of construction and lease-up.
These projects remain on track, as measured by budget, lease-up metrics, and current market valuations.
−Removed: During the three and six months ended June 30, 2022, we invested $62.5 million and $128.2 million respectively, in development and redevelopment activities.
+Added: During the three and nine months ended September 30, 2022, we invested $60.6 million and $188.9 million respectively, in development and redevelopment activities.
Updates include:
−Removed: As previously announced, following the successful development and lease-up of 707 Leahy in Redwood City, California, Prism in Cambridge, Massachusetts, Flamingo Point North Tower in Miami Beach, Florida, and The Fremont on the Anschutz Medical Campus in Aurora, Colorado, Aimco and AIR have agreed to cancel our leasehold interest in each property on or before September 1, 2022.
−Removed: In return for the termination of the leases, we will receive $200 million, resulting in value creation, net of costs, of approximately $100 million, which will be realized about 18 months sooner than originally anticipated.
−Removed: At The Hamilton in Miami, Florida, we now expect to welcome the first residents into redesigned and fully renovated units in August, 2022.
−Removed: As of July 31, 2022, 61 units were leased or pre-leased at rental rates more than 20% ahead of underwriting.
−Removed: Construction continues on schedule and on budget at Upton Place in Northwest Washington, D.C., the Benson Hotel and Faculty Club on the Anschutz Medical Campus in Aurora, Colorado and at our single-family home development project, Oak Shore, in Corte Madera, California.
+Added: As of September 30, 2022, at The Hamilton in Miami, Florida, leasing of units ahead of initial occupancy progressed with 83 units pre-leased.
+Added: Construction remains on schedule and on budget at Upton Place in Northwest Washington, D.C., the Benson Hotel and Faculty Club on the Anschutz Medical Campus in Aurora, Colorado and at our single-family home development project, Oak Shore, in Corte Madera, California.
+Added: As previously announced, following the successful development and lease-up of 707 Leahy in Redwood City, California, Prism in Cambridge, Massachusetts, North Tower of Flamingo Point in Miami Beach, Florida, and The Fremont on the Anschutz Medical Campus in Aurora, Colorado, Aimco and AIR entered an agreement that cancelled our leasehold interest in each property on September 1, 2022.
+Added: The transaction was completed on schedule at a combined asset value of $669 million.
+Added: We received $200 million, resulting in value creation, net of costs, of approximately $100 million, which was realized about 18 months sooner than originally anticipated.
Alternative Investments
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The borrower on our $362.8 million mezzanine loan, which is secured by the Parkmerced stabilized multifamily property plus phases two through nine of the site's future development opportunity, remains current on its first mortgage obligations.
−Removed: The neighboring San Francisco State University is expected to return to full in-person learning this fall, with hybrid options, increasing the demand for the apartments that serve as collateral for the Aimco loan.
−Removed: Due to the relative size of our investment and alternative accretive uses of capital, we recently initiated a marketing effort to explore potential opportunities to monetize all or a portion of our investment.
−Removed: We redeemed 22% of our passive equity investment in IQHQ Inc., a life sciences developer.
−Removed: In July, we received proceeds of $16.5 million from the sale resulting in a greater than 50% internal rate of return over the hold period for this portion of our investment.
−Removed: Aimco retained 2.4 million shares worth $59.7 million and the opportunity to collaborate with IQHQ on future development opportunities that include a multifamily component.
+Added: Due to the relative size of our investment and alternative accretive uses of capital, we initiated a marketing effort in July 2022 to explore opportunities to monetize all or a portion of our investment.
+Added: Increased uncertainty within financial markets has led us to extend the timeline for this process and its execution.
Investment Activity
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Updates include:
−Removed: In May, we executed joint venture agreements to act as a co-GP on the development of a phased multifamily community in Bethesda, Maryland.
−Removed: The project is fully entitled and includes approvals for over 2,200 units in six phases.
−Removed: We plan to participate in the first two multifamily phases totaling 574 units with an expected Aimco investment of $18.3 million, we also have rights to increase our investment and to choose to participate in future phases of development.
−Removed: In June, July, and August, we closed on the purchase of three development parcels we contracted to acquire, for $100 million, in February 2022.
−Removed: The nine-acre site is located in the rapidly growing Flagler Village neighborhood of Fort Lauderdale, Florida, and allows for approximately three million square feet of phased, mixed-use development, which could contain up to 1,500 residential units, more than 300 hotel keys, and more than 100,000 square feet of retail space at full build-out.
−Removed: We intend to execute the planned development activity through joint venture financing.
+Added: As previously announced, in July and August 2022, Aimco closed on the purchase of two development parcels, completing the assemblage it contracted to acquire, for $100 million, in February 2022.
+Added: The nine-acre assemblage is located in the rapidly growing Flagler Village neighborhood of Fort Lauderdale, Florida, and allows for approximately three million square feet of phased, mixed-use development, which could contain up to 1,500 residential units, more than 300 hotel keys, and more than 100,000 square feet of retail space at full build-out.
Operating Property Results
−Removed: Aimco owns a diversified portfolio of stabilized apartment communities located in ten major U.S.
+Added: Aimco owns a diversified portfolio of stabilized apartment communities located in eight major U.S.
markets with average rents in line with local market averages.
We also own a commercial office building that is part of an assemblage with an adjacent apartment building.
−Removed: Highlights for the three months ended June 30, 2022 include:
−Removed: Revenue in the second quarter of 2022 was $33.1 million, up 11.2% year over year, resulting from a $203 increase in average monthly revenue per apartment home to $2,039, and a 20-basis point increase in Average Daily Occupancy to 97.7%.
−Removed: Expenses the second quarter of 2022 were $10.4 million, up 4.8% year over year.
−Removed: Net operating income in the second quarter of 2022 was $22.7 million, up 14.4% year-over-year.
+Added: Highlights for the three months ended September 30, 2022 include:
+Added: Revenue in the third quarter of 2022 was $34.7 million, up 11.5% year over year, resulting from a $261 increase in average monthly revenue per apartment home to $2,173, offset with a 190-basis point decrease in Average Daily Occupancy to 96.0%.
+Added: Expenses in the third quarter of 2022 were $10.2 million, down 0.8% year over year.
+Added: Net operating income in the third quarter of 2022 was $24.5 million, up 17.5% year-over-year.
1001 Brickell Bay Drive, a waterfront office building in Miami, Florida, is owned as part of a larger assemblage with substantial development potential.
−Removed: In the first half of 2022, we executed leases on over 60,000 square feet of office space, at rates per square foot 20% higher than leases executed in the first half of 2021.
−Removed: At the end of the second quarter 2022, the building was 85% occupied, up from 73% at the same time last year.
+Added: In the nine months ended September 30, 2022, we executed leases on over 76,000 square feet of office space, at rates per square foot 15% higher than leases executed in the nine months ended September 30, 2021.
+Added: As of September 30, 2022, the building was 84% occupied, up from 73% at the same time last year.
Balance Sheet and Financing Activity
We are highly focused on maintaining a strong balance sheet, including having at all times ample liquidity.
−Removed: As of June 30, 2022, we had access to $215.5 million in liquidity, including $81.8 million of cash on hand, $12.5 million of restricted cash, and the capacity to borrow up to $121.2 million on our revolving credit facility.
+Added: As of September 30, 2022, we had access to $375.4 million in liquidity, including $206.3 million of cash on hand, $19.1 million of restricted cash, and the capacity to borrow up to $150.0 million on our revolving credit facility.
Refer to the Liquidity and Capital Resources section for additional information regarding our leverage.
4 unchanged sentences
Our Operating segment includes 21 residential apartment communities that have achieved stabilized level of operations as of January 1, 2021 and maintained it throughout the current year and comparable period.
−Removed: We aggregate all our
−Removed: apartment communities that have reached stabilization into our Operating segment.
+Added: We aggregate all our apartment communities that have reached stabilization into our Operating segment.
Our Other segment consists of properties that are not included in our Development and Redevelopment or Operating segments.
The following discussion and analysis of the results of our operations and financial condition should be read in conjunction with the accompanying condensed consolidated financial statements included in Item 1.
−Removed: Three and Six Months Ended June 30, 2022 compared with the Three and Six Months Ended June 30, 2021
−Removed: Net income increased by $258.8 million and by $246.8 million during the three and six months ended June 30, 2022, respectively, compared to the same periods in 2021, as described more fully below.
+Added: Three and Nine Months Ended September 30, 2022 compared with the Three and Nine Months Ended September 30, 2021
+Added: Net income increased by $34.5 million and by $281.3 million during the three and nine months ended September 30, 2022, respectively, compared to the same periods in 2021, as described more fully below.
Property Results
−Removed: As of June 30, 2022, our Development and Redevelopment segment included four properties that were under construction and four properties in lease-up.
+Added: As of September 30, 2022, our Development and Redevelopment segment included four properties that were under construction.
Our Operating segment included 21 communities with 5,582 apartment homes, and our Other segment included our recent Eldridge Townhomes acquisition, and one office building.
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Proportionate Property Net Operating Income
−Removed: The results of our segments for the three months ended June 30, 2022 and 2021, as presented below, are based on segment classifications as of June 30, 2022:
−Removed: Three Months Ended June 30,
+Added: The results of our segments for the three months ended September 30, 2022 and 2021, as presented below, are based on segment classifications as of September 30, 2022:
+Added: Three Months Ended
+Added: September 30,
(in thousands)
5 unchanged sentences
Development and Redevelopment
−Removed: For the three months ended June 30, 2022, compared to the same period in 2021:
−Removed: Development and Redevelopment proportionate property net operating income increased by $5.3 million due primarily to the delivery and lease up of units at newly constructed or redeveloped apartment communities.
−Removed: Development and Redevelopment proportionate property net operating income will decrease in the third quarter due to the termination of the four leases.
+Added: For the three months ended September 30, 2022, compared to the same period in 2021:
+Added: Development and Redevelopment proportionate property net operating income decreased from the amounts presented in our Form 10-Q dated June 30, 2022, due to the termination of the four initial leases.
Operating proportionate property net operating income increased by $3.6 million, or 17.5%.
−Removed: The increase was attributable primarily to a $3.3 million, or 11.2% increase in rental and other property revenues due to higher average revenues of $203 per apartment home, and a 20-basis point increase in occupancy.
+Added: The increase was attributable primarily to a $3.6 million, or 11.5% increase in rental and other property revenues due to higher average revenues of $261 per apartment home, offset with a 190-basis point decrease in occupancy.
Other proportionate property net operating income increased by $0.6 million, or 27.5%.
−Removed: The results of our segments for the six months ended June 30, 2022 and 2021, as presented below, are based on segment classifications as of June 30, 2022:
−Removed: Six Months Ended June 30,
+Added: The results of our segments for the nine months ended September 30, 2022 and 2021, as presented below, are based on segment classifications as of September 30, 2022:
+Added: Nine Months Ended September 30,
Historical Change
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Development and Redevelopment
−Removed: For the six months ended June 30, 2022, compared to the same period in 2021:
−Removed: Development and Redevelopment proportionate property net operating income increased by $9.3 million, due primarily to the delivery and lease up of units at newly constructed or redeveloped apartment communities.
−Removed: Development and Redevelopment proportionate property net operating income will decrease in the third quarter due to the termination of the four leases.
+Added: For the nine months ended September 30, 2022, compared to the same period in 2021:
+Added: Development and redevelopment proportionate property net operating income decreased by $1.0 million, due primarily to the major redevelopment of The Hamilton.
+Added: Development and redevelopment proportionate property net operating income decreased in the third quarter due to the termination of the four leases.
Operating proportionate property net operating income increased by $9.4 million, or 15.8%.
−Removed: The increase was attributable primarily to a $6.3 million, or 10.7% increase in rental and other property revenues due to higher average rental rates of $185 per apartment home, and a 50-basis point increase in occupancy.
+Added: The increase was attributable primarily to a $9.9 million, or 11.0% increase in rental and other property revenues due to higher average revenues of $210 per apartment home, offset with a 30-basis point decrease in occupancy.
Other proportionate property net operating income increased by $3.0 million, or 46.0%.
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Depreciation and Amortization
−Removed: For the three and six months ended June 30, 2022, depreciation and amortization expense increased by $14.2 million, or 68.9%, and $16.6 million, or 40.2%, respectively, when compared to the same periods in 2021, primarily due to additional assets being placed into service.
+Added: For the three and nine months ended September 30, 2022, depreciation and amortization expense increased by $63.7 million, or 100%, and $80.4 million, or 100%, respectively, when compared to the same periods in 2021, primarily due to accelerated depreciation recognized relating to the lease termination transaction in the amount of $69.9 million and $85.7 million for the three and nine months ended September 30, 2022, respectively.
General and Administrative Expenses
−Removed: For the three months ended June 30, 2022, general and administrative expenses increased by $1.6 million, or 21.4% compared to the three months ended June 30, 2021.
−Removed: For the six months ended June 30, 2022, general and administrative expenses increased by $4.7 million, or 34.6% compared to the six months ended June 30, 2021.
−Removed: General and administrative expenses incurred for the three and six months ended June 30, 2021 were prior to the full build out of our platform and are not representative of what we believe our anticipated expenses will be going forward.
−Removed: Additionally, for the three and six months ended June 30, 2022 and 2021, general and administrative expenses included $1.0 million and $2.0 million of expenses, respectively, to be reimbursed to AIR, per agreement upon separation, for consulting services with respect to strategic growth, direction, and advice.
+Added: For the three months ended September 30, 2022, general and administrative expenses increased by $1.9 million, or 21.9% compared to the three months ended September 30, 2021.
+Added: For the nine months ended September 30, 2022, general and administrative expenses increased by $6.7 million, or 29.6% compared to the nine months ended September 30, 2021.
+Added: General and administrative expenses incurred for the three and nine months ended September 30, 2021 were prior to the full build out of our platform and are not representative of what we believe our anticipated expenses will be going forward.
+Added: Additionally, for three and nine months ended September 30, 2022 and 2021, general and administrative expenses included $1.7 million and $4.6 million of expenses, respectively, to be reimbursed to AIR, per agreement upon separation, for consulting services with respect to strategic growth, direction, and advice.
This agreement will conclude at year end.
Interest Expense
−Removed: For the three and six months ended June 30, 2022, compared to the same periods in 2021, interest expense increased by $28.9 million, or 228.7%, and increased by $30.8 million, or 121.8%, respectively, due primarily to $26.4 million of spread maintenance costs related to early payoff of the Notes Payable to AIR and refinance of certain property debt.
+Added: For the three and nine months ended September 30, 2022, compared to the same periods in 2021, interest expense decreased by $3.0 million, or 23.4%, and increased by $27.9 million, or 73.4%, respectively.
+Added: The quarterly decrease of $3.0 million was due primarily to repayment and refinancing activity.
+Added: The year to date increase of $27.9 million was due primarily to spread maintenance costs related to prepayment of the Notes Payable to AIR and other debt, the refinancing of certain property debt, and the payoff of a construction loan.
Mezzanine Investment Income, Net
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Until legal title of the subsidiaries is transferred, AIR is obligated to pass payments on the mezzanine loan to us.
−Removed: As of June 30, 2022 and December 31, 2021, the total receivable, including accrued and unpaid interest, was $354.4 million and $337.8 million, respectively.
−Removed: During the three and six months ended June 30, 2022, we recognized $8.3 million and $16.6 million, respectively, of income in connection with the mezzanine loan, compared to $7.6 million and $15.0 million during the three and six months ended June 30, 2021, respectively.
+Added: As of September 30, 2022 and December 31, 2021, the total receivable, including accrued and unpaid interest, was $362.8 million and $337.8 million, respectively.
+Added: During the three and nine months ended September 30, 2022, we recognized $8.4 million and $25.0 million, respectively, of income in connection with the mezzanine loan, compared to $7.6 million and $22.7 million during the three and nine months ended September 30, 2021, respectively.
The loan is subject to certain risks, including, but not limited to, those resulting from the lingering disruption due to the COVID-19 pandemic and associated response, and any similar events that might occur in the future, which may result in all or a portion of the loan not being repaid.
In the event we determine that a portion of the related Mezzanine Investment is not recoverable, we will recognize an impairment.
−Removed: With the neighboring San Francisco State University returning to full in-person learning this fall, we now expect increasing demand for the local apartments that serve as collateral for our loan.
Realized and Unrealized Gains (Losses) on Interest Rate Options
−Removed: During the six months ended June 30, 2022, we monetized our $500.0 million notional amount interest rate swaption for $13.7 million and recognized a realized a gain of $8.0 million.
−Removed: We adjust our interest rate options to fair value on a quarterly basis.
−Removed: As a result of the mark-to-market adjustment, we recorded unrealized gains of $11.9 million and $30.7 million, respectively, during the three and six months ended June 30, 2022, compared to an unrealized loss of $17.0 million and an unrealized gain of $8.4 million during the three and six months ended June 30, 2021, respectively.
+Added: We recorded unrealized gains of $7.5 million and $38.3 million, respectively, during the three and nine months ended September 30, 2022, compared to unrealized gains of $2.2 million and $10.6 million during the three and nine months ended September 30, 2021, respectively.
+Added: In addition, we recorded realized gains of $1.7 million and $9.7 million during the three and nine months ended September 30, 2022.
Realized and Unrealized Gains (Losses) on Equity Investments
−Removed: During the three and six months ended June 30, 2022, 22% of our original investment in IQHQ was redeemed for $16.5 million and we recognized a realized gain of $5.7 million.
−Removed: Our remaining investment in IQHQ was valued at a stepped up basis at the same per share value as the cash redemption, and we recognized a $20.5 million unrealized gain.
+Added: In June 2022, 22% of our original investment in IQHQ was redeemed for $16.5 million and we recognized a realized gain of $5.7 million.
+Added: Our remaining investment in IQHQ with a cost basis of $39.2 million was valued at an estimated fair market value of $59.7 million, and a $20.5 million unrealized gain was recognized.at the same per share value as the cash redemption.
We measure our investments in property technology funds at NAV as a practical expedient.
−Removed: As a result of changes in NAV, we recorded an unrealized gain of $0.5 million and an unrealized loss of $3.9 million, respectively, during the three and six months ended June 30, 2022, compared to unrealized gains of $0.9 million during the three and six months ended June 30, 2021.
+Added: As a result of changes in NAV, we recorded unrealized losses of $2.2 million and $6.0 million, respectively, during the three and nine months ended September 30, 2022, compared to unrealized gains of $1.2 million and $2.1 million during the three and nine months ended September 30, 2021.
Gains on Dispositions of Real Estate
−Removed: During the three and six months ended June 30, 2022, we sold our Pathfinder Village property located in Fremont, California, for a gross sales price of $127.0 million and recognized a gain from the sale of $94.6 million.
+Added: In July and August 2022, we sold our Cedar Rim and 2900 on First properties located in Seattle, Washington, for a total gross sales price of $122.0 million and recognized gains from the sales of $75.5 million.
+Added: In May 2022, we sold our Pathfinder Village property located in Fremont, California, for a gross sales price of $127.0 million and recognized a gain from the sale of $94.6 million.
Lease Modification Income
−Removed: For the three and six months ended June 30, 2022, we as lessee and AIR as lessor, entered into a lease termination agreement pursuant to which AIR is required to pay us a termination payment on September 1, 2022, and upon receipt of such payment, the existing leases with respect to four properties will terminate.
−Removed: The total lease modification income recognized in the quarter was $205.4 million.
+Added: In June 2022, we as lessee and AIR as lessor, entered into a lease termination agreement pursuant to which AIR paid us a termination payment on September 1, 2022.
+Added: Upon receipt of this payment, the leases with respect to four properties were terminated, and we relinquished control of the associated leasehold improvements and underlying land of these four properties.
+Added: The total lease modification income recognized for the nine months ended September 30, 2022 was $207.0 million.
Other Income (Expense), Net
Other income (expense), net, includes costs associated with our risk management activities, partnership administration expenses, valuation changes associated with equity investments, fee income, and certain non-recurring items.
−Removed: Other income (expense), net, for the three months ended June 30, 2022 decreased by $3.5 million, or 169.2%, compared to the three months ended June 30, 2021.
−Removed: For the six months ended June 30, 2022 decreased by $3.9 million, or 161.8%.
−Removed: Income Tax Benefit
+Added: Other income (expense), net, for the three months ended September 30, 2022 decreased by $0.8 million, or 100.0%, compared to the three months ended September 30, 2021.
+Added: Other income (expense), net, for the nine months ended September 30, 2022, decreased by $4.7 million, or 100.0% compared to 2021.
+Added: Income Tax Benefit (Expense)
Certain aspects of our operations, including our development and redevelopment activities, are conducted through taxable REIT subsidiaries, or TRS entities.
1 unchanged sentence
Our income tax benefit calculated in accordance with GAAP includes income taxes associated with the income or loss of our TRS entities.
−Removed: Income taxes, as well as changes in valuation allowance and incremental deferred tax items in conjunction with intercompany asset transfers and internal restructurings (if applicable), are included in income tax benefit in our Condensed Consolidated Statements of Operations.
+Added: Income taxes, as well as changes in valuation allowance and incremental deferred tax items in conjunction with intercompany asset transfers and internal restructurings (if applicable), are included in income tax benefit (expense) in our Condensed Consolidated Statements of Operations.
Consolidated GAAP income or loss subject to tax consists of pretax income or loss of our taxable entities and gains retained by the REIT.
−Removed: For the three and six months ended June 30, 2022, we had consolidated net income subject to tax of $181.4 million and $166.6 million, respectively.
−Removed: For the three and six months ended June 30, 2021, we had consolidated net losses subject to tax of $9.0 million and $18.5 million, respectively.
−Removed: For the three months ended June 30, 2022, we recognized income tax expense of $46.0 million compared to an income tax benefit $2.8 million during the same period in 2021.
−Removed: The change is primarily due to the GAAP income taxes associated with the lease termination income recognized in the second quarter of 2022.
−Removed: For the six months ended June 30, 2022, we recognized income tax expense of $41.9 million compared to a $7.9 million benefit during the same period in 2021.
−Removed: The change is primarily due to the GAAP income taxes associated with the lease termination income recognized in the second quarter of 2022.
+Added: For the three and nine months ended September 30, 2022, we had consolidated net loss and income subject to tax of $75.6 million and $91.0 million, respectively.
+Added: For the three and nine months ended September 30, 2021, we had consolidated net losses subject to tax of $7.9 million and $26.4 million, respectively.
+Added: For the three months ended September 30, 2022, we recognized income tax benefit of $17.6 million compared to a $2.0 million benefit during the same period in 2021.
+Added: The change is primarily due to the GAAP income taxes associated with the lease modification depreciation expense recognized in the third quarter of 2022.
+Added: For the nine months ended September 30, 2022, we recognized income tax expense of $24.3 million compared to a $9.9 million benefit during the same period in 2021.
+Added: The change is primarily due to the GAAP income taxes associated with the net lease modification income recognized in 2022.
Critical Accounting Policies and Estimates
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Additionally, we exclude interest income recognized on our Mezzanine Investment that was accrued but not paid.
−Removed: The reconciliation of net income to EBITDAre and Adjusted EBITDAre for the three and six months ended June 30, 2022 and 2021, is as follows (in thousands):
+Added: The reconciliation of net income to EBITDAre and Adjusted EBITDAre for the three and nine months ended September 30, 2022 and 2021, is as follows (in thousands):
Three Months Ended
−Removed: Six Months Ended
−Removed: Net income (loss) attributable to Aimco
+Added: September 30,
+Added: Nine Months Ended
+Added: September 30,
+Added: Net income (loss)
Interest expense
−Removed: Income tax expense (benefit)
−Removed: Gain on dispositions of real estate
+Added: Income tax (benefit) expense
+Added: Gains on dispositions of real estate
Lease modification income
1 unchanged sentence
Adjustment related to EBITDAre of unconsolidated partnerships
−Removed: Net (income) loss attributable to redeemable noncontrolling interests in consolidated real estate partnerships
−Removed: Net (income) loss attributable to noncontrolling interests in consolidated real estate partnerships
+Added: Net (income) loss attributable to redeemable noncontrolling
+Added: interests in consolidated real estate partnerships
+Added: Net (income) loss attributable to noncontrolling interests
+Added: in consolidated real estate partnerships
EBITDAre adjustments attributable to noncontrolling interests
Mezzanine investment income, net (1)
−Removed: Unrealized (gains) losses on interest rate options
+Added: Realized and unrealized (gains) losses on interest rate options
Unrealized (gains) losses on IQHQ investment
4 unchanged sentences
Our primary sources of liquidity are cash flows from operations and borrowing capacity under our loan agreements.
−Removed: As of June 30, 2022, our available liquidity was $215.5 million, which consisted of:
+Added: As of September 30, 2022, our available liquidity was $375.4 million, which consisted of:
$206.3 million in cash and cash equivalents;
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$150.0 million of available capacity to borrow under our revolving secured credit facility.
−Removed: We have commitments for, and expect to spend, approximately $188.4 million on development and redevelopment projects underway, with $231.3 million undrawn on our construction loans as of June 30, 2022 and limited partner equity commitments of $2.3 million.
−Removed: We are under contract to acquire, for $36.0 million, the two remaining land parcels of the nine-acre development site in Fort Lauderdale.
−Removed: Our Edgewater joint venture and DC joint ventures have remaining commitments of $12.0 million and we also have unfunded commitments in the amount of $2.9 million related to four investments in entities that develop technology related to the real estate industry.
+Added: We have commitments for, and expect to spend, approximately $152.1 million on development and redevelopment projects underway, with $211.2 million undrawn on our construction loans as of September 30, 2022.
+Added: The initial allocation to our Edgewater joint venture and DC joint ventures have remaining unfunded commitments of $14.2 million.
+Added: We also have unfunded commitments in the amount of $2.7 million related to four investments in entities that develop technology for the real estate industry.
Our principal uses for liquidity include normal operating activities, payments of principal and interest on outstanding debt, capital expenditures, and future investments.
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In the event that our cash and cash equivalents, revolving secured credit facility, and cash provided by operating activities are not sufficient to cover our liquidity needs, we have the means to generate additional liquidity, such as from additional property financing activity and proceeds from apartment community sales.
−Removed: We expect to meet our long-term liquidity requirements, including debt maturities, development and redevelopment spending, and future investment activity, primarily through property financing activity, cash generated from operations, and the recycling of our equity.
+Added: We expect to meet our long-term liquidity requirements, including debt maturities, development and redevelopment spending, and future investment activity, primarily through property
+Added: financing activity, cash generated from operations, and the recycling of our equity.
Our revolving secured credit facility matures in December 2023, prior to consideration of its two one-year extension options.
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The availability and cost of credit and its related effect on the overall economy may affect our liquidity and future financing activities, both through changes in interest rates and access to financing.
−Removed: Currently, financing is readily available.
Any adverse changes in the lending environment could negatively affect our liquidity.
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However, if property or development financing options become unavailable, we may consider alternative sources of liquidity, such as reductions in capital spending or apartment community dispositions.
−Removed: As of June 30, 2022, 70% of our leverage consisted of property-level, non-recourse debt.
−Removed: Approximately 96% of our property-level debt is fixed-rate, which provides a hedge against increases in interest rates, capitalization rates, and inflation.
−Removed: As of June 30, 2022, the weighted-average interest rate on our property-level debt was 4.4%, and the remaining term to maturity was 8.4 years.
−Removed: While our primary source of leverage is property-level debt, we also have a secured $150.0 million credit facility with a syndicate of financial institutions, the Notes Payable to AIR, and construction loans.
−Removed: As of June 30, 2022, we had no outstanding borrowings under our revolving secured credit facility.
−Removed: We had a $28.8 million letter of credit outstanding related to a contract to purchase a nine-acre development site in Fort Lauderdale;
−Removed: consequently, we had capacity to borrow up to $121.2 million under our secured credit facility.
+Added: As of September 30, 2022, 81% of our outstanding debt had a fixed interest rate and 19% had a variable interest rate.
+Added: The weighted-average interest rate on our non-recourse debt was 4.86%, and the average remaining term to maturity was 7.2 years.
+Added: At quarter end, Aimco had interest rate cap protection in place for 100% of its variable interest rate debt.
+Added: Aimco's use of interest rate caps may vary from quarter to quarter depending on lender requirements, recycling of interest rate caps between projects, and our view on forecasted interest rates.
+Added: While our primary source of leverage is property-level debt, we also have a secured $150.0 million credit facility with a syndicate of financial institutions, and construction loans.
+Added: As of September 30, 2022, we had no outstanding borrowings under our revolving secured credit facility.
Under our revolving secured credit facility, we have agreed to maintain a fixed charge coverage ratio of 1.25X minimum tangible net worth of $625.0 million, and maximum leverage of 60.0% as defined in the credit agreement.
We are currently in compliance and expect to remain in compliance with these covenants during the next twelve months.
−Removed: As of June 30, 2022, 13% of our leverage consisted of the Notes Payable to AIR, with a fixed interest rate of 5.2% and a term to maturity of 1.6 years.
−Removed: An additional 18% consisted of our variable-rate non-recourse construction loans.
−Removed: As previously disclosed, in July 2022, we paid off the Notes Payable to AIR in full.
Changes in Cash, Cash Equivalents, and Restricted Cash
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Operating Activities
−Removed: For the six months ended June 30, 2022, net cash provided by operating activities was $25.4 million.
+Added: For the nine months ended September 30, 2022, net cash provided by operating activities was $228.3 million.
Our operating cash flow is primarily affected by rental rates, occupancy levels, and operating expenses related to our portfolio of apartment communities and general and administrative costs.
−Removed: Cash provided by operating activities for the six months ended June 30, 2022 increased by $8.9 million compared to the same period ended in 2021 due to timing of balance sheet position changes.
+Added: Cash provided by operating activities for the nine months ended September 30, 2022, increased by $206.2 million compared to the same period ended in 2021 due to timing of balance sheet position changes.
Investing Activities
−Removed: For the six months ended June 30, 2022, our net cash used in investing activities of $125.4 million consisted primarily of capital expenditures and $100.8 million of cash used to acquire undeveloped land parcels in Fort Lauderdale, Florida, offset by $126.8 million of proceeds received from the disposition of our property located in Freemont, California.
−Removed: Total capital additions were $124.8 million and $100.2 million during the six months ended June 30, 2022 and 2021, respectively, primarily used for construction costs on our development properties.
−Removed: We have generally funded capital additions with available cash and cash provided by operating activities and construction loans.
−Removed: Also, during the six months ended June 30, 2022, we funded the remaining $14.2 million of our total commitment of $50.0 of a passive equity investment in IQHQ, a life sciences developer.
+Added: For the nine months ended September 30, 2022, our net cash used in investing activities of $83.0 million consisted primarily of capital expenditures of $184.0 and $130.1 million of cash used to acquire undeveloped land parcels in Fort Lauderdale, Florida, offset by $243.1 million of proceeds received from the disposition of our properties located in Fremont, California and Seattle, Washington.
+Added: Total capital additions were $184.0 million and $134.9 million during the nine months ended September 30, 2022 and 2021, respectively, and were primarily used for construction costs on our development and redevelopment properties.
+Added: We have generally funded capital additions with available cash, cash provided by operating activities, and construction loans.
We exclude the amounts of capital spending related to commercial spaces and to apartment communities sold or classified as held for sale at the end of the period from the foregoing measures.
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Financing Activities
−Removed: Net cash used by financing activities for the six months ended June 30, 2022 increased by $132.3 million compared to the six months ended June 30, 2021 due primarily to $283.8 million in payoffs of non-recourse property debt, a $387.1 million paydown of Notes Payable to AIR, and a reduction in construction loan proceeds of $86.5 million year over year offset by a $614.7 million increase in proceeds received from non-recourse property debt issuances.
+Added: For the nine months ended September 30, 2022, our net cash used in financing activities of $164.4 million consisted primarily of the $534.1 million payoff of the Notes Payable to AIR, $284.6 million to retire property debt and the $138.4 million paydown
+Added: of construction loans, offset by $674.7 million in cash raised from the issuance of new property debt and a $102.0 million redeemable noncontrolling interest preferred equity contribution from an institutional partner.
+Added: Net cash provided by financing activities for the nine months ended September 30, 2021 was $158.6 million primarily due to $142.3 million of proceeds received from construction loans undertaken.
Future Capital Needs
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QUANTITATIVE AND QUALITATI VE DISCLOSURES ABOUT MARKET RISK
−Removed: Our chief market risks are refunding risk, that is the availability of property debt or other cash sources to refund maturing property debt, including the Notes Payable to AIR, and repricing risk, that is the possibility of increases in base interest rates and credit risk spreads.
+Added: Our chief market risks are refunding risk, that is the availability of property debt or other cash sources to refund maturing property debt, and repricing risk, that is the possibility of increases in base interest rates and credit risk spreads.
We use long-dated, fixed-rate, non-recourse property debt in order to avoid the refunding and repricing risks of short-term borrowings.
We use working capital primarily to fund short-term uses.
−Removed: We make limited use of derivative financial instruments and we do not use them for trading or other speculative purposes.
−Removed: As of June 30, 2022, on a consolidated basis, we had approximately $31.9 million of variable-rate property-level debt outstanding in addition to two variable rate construction loans that totaled $203.4 million.
−Removed: We estimate that a change in floating rates of 100 basis points with constant credit risk spreads would reduce or increase interest expense by approximately $2.4 million.
−Removed: In 2020, we paid an upfront premium of $12.1 million for the option to enter into a $1.5 billion notional amount interest rate swap at a future date.
−Removed: This interest rate option, or swaption, provides partial protection against exposure to rising interest rates between now and October 2024.
−Removed: During the quarter ended March 31, 2021, we paid an upfront premium of $0.3 million for interest rate caps for the entire amounts on our Flamingo and The Hamilton construction loans.
−Removed: These interest rate caps provide protection if one month LIBOR exceeds 3.0% during the initial term of the loans.
−Removed: During the quarter ended June 30, 2022, we paid an upfront premium of $0.4 million for an interest rate cap on our Oak Shore construction loan.
−Removed: The interest rate cap provides protection if one month term SOFR exceeds 3.5% during the initial term of the loan.
+Added: We make limited use of derivative financial instruments primarily to mitigate repricing risk, and we do not use them for trading or other speculative purposes.
+Added: As of September 30, 2022, on a consolidated basis, we had approximately $91.9 million of variable-rate property-level debt outstanding in addition to three variable rate construction loans that totaled $86.7 million.
+Added: We estimate that a change in variable rates of 100 basis points with constant credit risk spreads would reduce or increase interest expense by approximately $1.8 million.
+Added: This risk is mitigated by Aimco's use of interest rate caps, which as of September 30, 2022, provided protection for 100% of its variable interest rate debt.
+Added: Aimco's use of interest rate caps may vary from quarter to quarter depending on lender requirements, recycling of interest rate caps between projects, and Aimco's view on forecasted interest rates.
+Added: As of September 30, 2022, we held interest rate swaps and caps with $1.7 billion notional value that provide protection through June 2025.
+Added: These instruments were acquired for $15.7 million and are currently valued at $61.3 million.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.