2 unchanged sentences
Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures
−Removed: Under the supervision and with the participation of the Parent Company’s management, including its principal executive officer and principal financial officer, the Parent Company’s management conducted an evaluation of its disclosure controls and
−Removed: procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
+Added: Under the supervision and with the participation of the Parent Company’s management, including its principal executive officer and principal financial officer, the Parent Company’s management conducted an evaluation of its disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
Based on this evaluation, the principal executive officer and the principal financial officer of the Parent Company concluded that the Parent Company’s disclosure controls and procedures were effective as of the end of the period covered by this annual report.
16 unchanged sentences
Changes in Internal Control over Financial Reporting.
−Removed: There have not been any changes in the Operating Partnership’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fourth fiscal quarter to which this report relates that have
−Removed: materially affected, or are reasonably likely to materially affect, the Operating Partnership’s internal control over financial reporting.
+Added: There have not been any changes in the Operating Partnership’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fourth fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Operating Partnership’s internal control over financial reporting.
Other Information
10 unchanged sentences
Exhibits and Financial Statement Schedules.
−Removed: Financial Statements and Schedules of Brandywine Realty Trust
−Removed: Financial Statements and Schedules of Brandywine Operating Partnership
+Added: (a) Financial Statements and Schedules of Brandywine Realty Trust
+Added: (b) Financial Statements and Schedules of Brandywine Operating Partnership
The financial statements and schedules of the Parent Company and the Operating Partnership listed below are filed as part of this report on the pages indicated.
73 unchanged sentences
4.6 Form of 3.95% Guaranteed Notes due 2027 previously filed as an exhibit to Brandywine Realty Trust's Form 8-K filed on November 17, 2017 and incorporated herein by reference)
−Removed: Description of Brandywine Realty Trust's Securities (filed herewith)
+Added: 4.7 Description of Brandywine Realty Trust's Securities ( previously filed as an exhibit to Brandywine Realty Trust 's Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and incorporated herein by reference )
10.1 Amended and Restated Revolving Credit Agreement dated as of July 17, 2018 (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on July 20, 2018 and incorporated herein by reference)
11 unchanged sentences
1 to Amended and Restated 1997 Long-Term Incentive Plan** (previously filed as an exhibit to Brandywine Realty Trust’s Form 10-Q for the quarter ended March 31, 2018 and incorporated herein by reference)
−Removed: Amended and Restated Executive Deferred Compensation Plan dated January 1, 2013** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K dated December 11, 2012 and incorporated herein by reference)
+Added: 10.9 Brandywine Realty Trust Second Amended and Restated Executive Deferred Compensation Plan (as Amended and Restated, Effective January 1, 2021)** (filed herewith)
10.10 2007 Non-Qualified Employee Share Purchase Plan** (previously filed as an exhibit to Brandywine Realty Trust’s Form 10-Q for the quarter ended March 31, 2007 and incorporated herein by reference)
−Removed: Schedule of Non-Employee Trustee Compensation** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 6, 2018 and incorporated herein by reference)
10.11 Form of Amended and Restated Change of Control Agreement with Executive Officers** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on February 4, 2010 and incorporated herein by reference)
−Removed: Forms of Incentive Stock Option Agreement (March 2010) for Executive Officers** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 8, 2010 and incorporated herein by reference)
−Removed: Forms of Non-Qualified Share Option Agreement (March 2010) for Executive Officers** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 8, 2010 and incorporated herein by reference)
10.12 Forms of Incentive Share Option Agreement (March 2011) for Executive Officers** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 8, 2011 and incorporated herein by reference)
2 unchanged sentences
10.15 Form of Incentive Compensation Clawback Agreement** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on February 26, 2015 and incorporated herein by reference)
−Removed: Form of Performance Unit Award Agreement** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 7, 2017 and incorporated herein by reference)
−Removed: 2017-2019 Performance Share Unit Program** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 7, 2017 and incorporated herein by reference)
−Removed: Form of Restricted Share Award (President and CEO)** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 7, 2017 and incorporated herein by reference)
−Removed: Form of Restricted Share Award (Other Executives)** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 7, 2017 and incorporated herein by reference)
−Removed: Form of Performance Unit Award Agreement** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 6, 2018 and incorporated herein by reference)
−Removed: 2018-2020 Performance Share Unit Program** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 6, 2018 and incorporated herein by reference)
10.16 Form of Three-Year Restricted Common Share Rights Award.** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 6, 2018 and incorporated herein by reference)
10.17 Schedule of Non-Employee Trustee Compensation** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 6, 2018 and incorporated herein by reference)
+Added: 10.18 Form of Performance Unit Award Agreement** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on February 25, 2019 and incorporated herein by reference)
+Added: 10.19 2019-2021 Performance Share Unit Program** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on February 25, 2019 and incorporated herein by reference)
+Added: 10.2 Form of Three-Year Restricted Common Share Rights Award (with outperformance feature)** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on February 25, 2019 and incorporated herein by reference)
+Added: 10.21 Form of Two-Year Restricted Common Share Rights Award** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on February 25, 2019 and incorporated herein by reference)
+Added: 10.22 Form of Performance Unit Award Agreement** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 11, 2020 and incorporated herein by reference)
+Added: 10.23 2020-2022 Performance Share Unit Program** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 11, 2020 and incorporated herein by reference)
+Added: 10.24 Form of Restricted Common Share Rights Award (with outperformance feature)** (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on March 11, 2020 and incorporated herein by reference)
14.1 Code of Business Conduct and Ethics, as amended on December 6, 2016 (previously filed as an exhibit to Brandywine Realty Trust’s Form 8-K filed on December 9, 2016 and incorporated herein by reference)
21 unchanged sentences
** Management contract or compensatory plan or arrangement
−Removed: Financial Statement Schedule:
+Added: (d) Financial Statement Schedule:
See Item 15 (a) and (b) above
4 unchanged sentences
President and Chief Executive Officer
−Removed: March 2, 2020
+Added: February 24, 2021
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
+Added: Signature Title Date
/s/ Michael J.
−Removed: Chairman of the Board and Trustee
−Removed: March 2, 2020
+Added: Chairman of the Board and Trustee February 24, 2021
/s/ Gerard H.
−Removed: President, Chief Executive Officer and Trustee (Principal Executive Officer)
−Removed: March 2, 2020
+Added: President, Chief Executive Officer and Trustee (Principal Executive Officer) February 24, 2021
/s/ Thomas E.
−Removed: Executive Vice President and Chief Financial Officer (Principal Financial Officer)
−Removed: March 2, 2020
+Added: Executive Vice President and Chief Financial Officer (Principal Financial Officer) February 24, 2021
/s/ Daniel Palazzo
−Removed: Vice President and Chief Accounting Officer (Principal Accounting Officer)
−Removed: March 2, 2020
+Added: Vice President and Chief Accounting Officer (Principal Accounting Officer) February 24, 2021
Daniel Palazzo
−Removed: /s/ Wyche Fowler
−Removed: March 2, 2020
−Removed: March 2, 2020
−Removed: /s/ Anthony A.
−Removed: March 2, 2020
+Added: /s/ Wyche Fowler Trustee February 24, 2021
+Added: Diggs Trustee February 24, 2021
/s/ Charles P.
−Removed: March 2, 2020
−Removed: March 2, 2020
+Added: Pizzi Trustee February 24, 2021
+Added: Herubin Trustee February 24, 2021
Richard Haverstick, Jr.
−Removed: March 2, 2020
+Added: Trustee February 24, 2021
Richard Haverstick, Jr.
4 unchanged sentences
President and Chief Executive Officer
−Removed: March 2, 2020
+Added: February 24, 2021
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
+Added: Signature Title Date
/s/ Michael J.
−Removed: Chairman of the Board and Trustee
−Removed: March 2, 2020
+Added: Chairman of the Board and Trustee February 24, 2021
/s/ Gerard H.
−Removed: President, Chief Executive Officer and Trustee (Principal Executive Officer)
−Removed: March 2, 2020
+Added: President, Chief Executive Officer and Trustee (Principal Executive Officer) February 24, 2021
/s/ Thomas E.
−Removed: Executive Vice President and Chief Financial Officer (Principal Financial Officer)
−Removed: March 2, 2020
+Added: Executive Vice President and Chief Financial Officer (Principal Financial Officer) February 24, 2021
/s/ Daniel Palazzo
−Removed: Vice President and Chief Accounting Officer (Principal Accounting Officer)
−Removed: March 2, 2020
+Added: Vice President and Chief Accounting Officer (Principal Accounting Officer) February 24, 2021
Daniel Palazzo
−Removed: /s/ Wyche Fowler
−Removed: March 2, 2020
−Removed: /s/ James Diggs
−Removed: March 2, 2020
−Removed: /s/ Anthony A.
−Removed: March 2, 2020
+Added: /s/ Wyche Fowler Trustee February 24, 2021
+Added: /s/ James Diggs Trustee February 24, 2021
/s/ Charles P.
−Removed: March 2, 2020
−Removed: March 2, 2020
+Added: Pizzi Trustee February 24, 2021
+Added: Herubin Trustee February 24, 2021
Richard Haverstick, Jr.
−Removed: March 2, 2020
+Added: Trustee February 24, 2021
Richard Haverstick, Jr.
30 unchanged sentences
Impairment Assessments of Real Estate Investments and Investments in Unconsolidated Real Estate Ventures
−Removed: As described in Notes 2, 3 and 4 to the consolidated financial statements, the Company’s gross carrying value of operating real estate investments was $4,006 million and its investments in unconsolidated real estate ventures was $12o million as of December 31, 2019.
+Added: As described in Notes 2, 3 and 4 to the consolidated financial statements, the Company’s gross carrying value of operating real estate investments was $3,474 million and its investments in unconsolidated real estate ventures was $401 million as of December 31, 2020.
During 2020, the Company did not recognize an impairment related to real estate investments or an other than temporary impairment related to investments in unconsolidated real estate ventures.
5 unchanged sentences
An investment is other than temporarily impaired only if the fair value of the investment in an unconsolidated real estate venture, as estimated by management, is less than the carrying value and the decline is other than temporary.
−Removed: The principal considerations for our determination that performing procedures relating to the impairment assessments of real estate investments and investments in unconsolidated real estate ventures is a critical audit matter are there was significant judgment by management when evaluating the real estate investments and investments in unconsolidated real estate ventures for potential impairment.
+Added: The principal considerations for our determination that performing procedures relating to the impairment assessments of real estate investments and investments in unconsolidated real estate ventures is a critical audit matter are the significant judgment by management when evaluating the real estate investments and investments in unconsolidated real estate ventures for potential impairment.
This in turn led to a high degree of auditor judgment and subjectivity in applying procedures and evaluating audit evidence related to (i) the estimated undiscounted future cash flows expected to be generated by the real estate investments and (ii) the identification of any indicators that the value of the Company’s investments in unconsolidated real estate ventures may be other than temporarily impaired.
−Removed: In addition, there was significant audit effort in evaluating (i) the significant assumptions relating to the estimated undiscounted future cash flows expected to be generated by the real estate investments, including market rental rates, capitalization rates, and recent sales data for comparable real estate investments, and (ii) any indicators that the value of the Company’s investments in unconsolidated real estate ventures may be other than temporarily impaired.
+Added: In addition, there was significant audit effort in evaluating (i) the significant assumptions relating to the estimated undiscounted future cash flows expected to be generated by the real estate investments, related to market rental rates, capitalization rates, and recent sales data for comparable real estate investments, and (ii) any indicators that the value of the Company’s investments in unconsolidated real estate ventures may be other than temporarily impaired.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.
−Removed: These procedures included testing the effectiveness of controls relating to the impairment assessments of real estate investments and investments in unconsolidated real estate ventures, including controls over management’s identification of events or changes in circumstances that may indicate an impairment of real estate investments or indicate that the value of the Company’s investments in unconsolidated real estate ventures may be other than temporarily impaired.
+Added: These procedures included testing the effectiveness of controls relating to the impairment assessments of real estate investments and investments in unconsolidated real estate ventures, including controls over management’s estimated undiscounted future cash flows expected to be generated by real estate investments and management’s identification of any indicators that the value of the Company’s investments in unconsolidated real estate ventures may be other than temporarily impaired.
These procedures also included, among others, testing management’s process for (i) developing the estimated undiscounted future cash flows expected to be generated by the real estate investments, including the evaluation of the reasonableness of significant assumptions, the appropriateness of methods, the reasonableness of the model outputs and testing the completeness and accuracy of data provided by management, and (ii) identifying any indicators that the value of the Company’s investments in unconsolidated real estate ventures may be other than temporarily impaired.
−Removed: Evaluating the reasonableness of significant assumptions relating to the estimated undiscounted future cash flows expected to be generated by the real estate investments, including market rental rates, capitalization rates, and recent sales data for comparable real estate investments, involved considering past performance of the asset and whether the assumptions were consistent with evidence obtained in other areas of the audit.
+Added: Evaluating the reasonableness of significant assumptions relating to the estimated undiscounted future cash flows expected to be generated by the real estate investments, related to market rental rates, capitalization rates, and recent sales data for comparable real estate investments, involved considering past performance of the asset and whether the assumptions were consistent with evidence obtained in other areas of the audit.
Evaluating management’s assessment of indications of other than temporary impairment in investments in unconsolidated real estate ventures involved considering whether any market economic conditions, past performance of the asset, or evidence obtained in other areas of the audit may be indicative of other than temporary impairment.
1 unchanged sentence
Philadelphia, Pennsylvania
−Removed: March 2, 2020
+Added: February 24, 2021
We have served as the Company’s auditor since 2003.
31 unchanged sentences
Impairment Assessments of Real Estate Investments and Investments in Unconsolidated Real Estate Ventures
−Removed: As described in Notes 2, 3 and 4 to the consolidated financial statements, the Partnership’s gross carrying value of operating real estate investments was $4,006 million and its investments in unconsolidated real estate ventures was $12o million as of December 31, 2019.
+Added: As described in Notes 2, 3 and 4 to the consolidated financial statements, the Partnership’s gross carrying value of operating real estate investments was $3,474 million and its investments in unconsolidated real estate ventures was $401 million as of December 31, 2020.
During 2020, the Partnership did not recognize an impairment related to real estate investments or an other than temporary impairment related to investments in unconsolidated real estate ventures.
5 unchanged sentences
An investment is other than temporarily impaired only if the fair value of the investment in an unconsolidated real estate venture, as estimated by management, is less than the carrying value and the decline is other than temporary.
−Removed: The principal considerations for our determination that performing procedures relating to the impairment assessments of real estate investments and investments in unconsolidated real estate ventures is a critical audit matter are there was significant judgment by management when evaluating the real estate investments and investments in unconsolidated real estate ventures for potential impairment.
+Added: The principal considerations for our determination that performing procedures relating to the impairment assessments of real estate investments and investments in unconsolidated real estate ventures is a critical audit matter are the significant judgment by management when evaluating the real estate investments and investments in unconsolidated real estate ventures for potential impairment.
This in turn led to a high degree of auditor judgment and subjectivity in applying procedures and evaluating audit evidence related to (i) the estimated undiscounted future cash flows expected to be generated by the real estate investments and (ii) the identification of any indicators that the value of the Partnership’s investments in unconsolidated real estate ventures may be other than temporarily impaired.
−Removed: In addition, there was significant audit effort in evaluating (i) the significant assumptions relating to the estimated undiscounted future cash flows expected to be generated by the real estate investments, including market rental rates, capitalization rates, and recent sales data for comparable real estate investments, and (ii) any indicators that the value of the Partnership’s investments in unconsolidated real estate ventures may be other than temporarily impaired.
+Added: In addition, there was significant audit effort in evaluating (i) the significant assumptions relating to the estimated undiscounted future cash flows expected to be generated by the real estate investments, related to market rental rates, capitalization rates, and recent sales data for comparable real estate investments, and (ii) any indicators that the value of the Partnership’s investments in unconsolidated real estate ventures may be other than temporarily impaired.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.
−Removed: These procedures included testing the effectiveness of controls relating to the impairment assessments of real estate investments and investments in unconsolidated real estate ventures, including controls over management’s identification of events or changes in circumstances that may indicate an impairment of real estate investments or indicate that the value of the Partnership’s investments in unconsolidated real estate ventures may be other than temporarily impaired.
+Added: These procedures included testing the effectiveness of controls relating to the impairment assessments of real estate investments and investments in unconsolidated real estate ventures, including controls over management’s estimated undiscounted future cash flows expected to be generated by real estate investments and management’s identification of any indicators that the value of the Partnership’s investments in unconsolidated real estate ventures may be other than temporarily impaired.
These procedures also included, among others, testing management’s process for (i) developing the estimated undiscounted future cash flows expected to be generated by the real estate investments, including the evaluation of the reasonableness of significant assumptions, the appropriateness of methods, the reasonableness of the model outputs and testing the completeness and accuracy of data provided by management, and (ii) identifying any indicators that the value of the Partnership’s investments in unconsolidated real estate ventures may be other than temporarily impaired.
−Removed: Evaluating the reasonableness of significant assumptions relating to the estimated undiscounted future cash flows expected to be generated by the real estate investments, including market rental rates, capitalization rates, and recent sales data for comparable real estate investments, involved considering past performance of the asset and whether the assumptions were consistent with evidence obtained in other areas of the audit.
+Added: Evaluating the reasonableness of significant assumptions relating to the estimated undiscounted future cash flows expected to be generated by the real estate investments, related to market rental rates, capitalization rates, and recent sales data for comparable real estate investments, involved considering past performance of the asset and whether the assumptions were consistent with evidence obtained in other areas of the audit.
Evaluating management’s assessment of indications of other than temporary impairment in investments in unconsolidated real estate ventures involved considering whether any market economic conditions, past performance of the asset, or evidence obtained in other areas of the audit may be indicative of other than temporary impairment.
1 unchanged sentence
Philadelphia, Pennsylvania
−Removed: March 2, 2020
+Added: February 24, 2021
We have served as the Partnership’s auditor since 2003.
2 unchanged sentences
(in thousands, except share and per share information)
−Removed: December 31, 2019
−Removed: December 31, 2018
+Added: December 31, 2020 December 31, 2019
Real estate investments:
10 unchanged sentences
Accounts receivable, net of allowance of $ 0 and $ 284 as of December 31, 2020 and December 31, 2019, respectively
+Added: 13,536 16,363
Accrued rent receivable, net of allowance of $ 5,086 and $ 7,691 as of December 31, 2020 and December 31, 2019, respectively
+Added: 155,372 174,144
Investment in Real Estate Ventures, equity method 401,327 120,294
1 unchanged sentence
Intangible assets, net 48,570 84,851
+Added: Other assets 176,747 115,678
+Added: Total assets $ 3,900,106 $ 4,075,969
LIABILITIES AND BENEFICIARIES' EQUITY
Mortgage notes payable, net $ — $ 313,812
−Removed: Unsecured credit facility
Unsecured term loan, net 249,084 248,561
16 unchanged sentences
Cumulative earnings 1,110,083 804,556
−Removed: Accumulated other comprehensive income
+Added: Accumulated other comprehensive loss ( 7,561 ) ( 2,370 )
Cumulative distributions ( 2,448,238 ) ( 2,318,233 )
8 unchanged sentences
Year Ended December 31,
+Added: 2020 2019 2018
+Added: Rents $ 513,504 $ 554,665 $ 515,044
Third party management fees, labor reimbursement and leasing 18,580 19,626 22,557
+Added: Other 2,768 6,126 6,744
Total revenue 534,852 580,417 544,345
22 unchanged sentences
Income tax (provision) benefit 224 ( 12 ) ( 423 )
+Added: Net income 307,326 34,529 135,472
Net income attributable to noncontrolling interests ( 1,799 ) ( 262 ) ( 954 )
Net income attributable to Brandywine Realty Trust 305,527 34,267 134,518
−Removed: Distribution to preferred shareholders
−Removed: Preferred share redemption charge
Nonforfeitable dividends allocated to unvested restricted shareholders ( 410 ) ( 396 ) ( 369 )
9 unchanged sentences
Year Ended December 31,
+Added: 2020 2019 2018
+Added: Net income $ 307,326 $ 34,529 $ 135,472
Comprehensive income (loss):
11 unchanged sentences
(in thousands, except number of shares)
−Removed: Number of Preferred Shares
−Removed: Par Value of Preferred Shares
−Removed: Number of Common Shares
−Removed: Number of Rabbi Trust/Deferred Compensation Shares
−Removed: Common Shares of Brandywine Realty Trust's beneficial interest
−Removed: Additional Paid-in Capital
−Removed: Deferred Compensation Payable in Common Shares
−Removed: Common Shares in Grantor Trust
−Removed: Cumulative Earnings
−Removed: Accumulated Other Comprehensive Income (Loss)
−Removed: Cumulative Distributions
−Removed: Noncontrolling Interests
−Removed: BALANCE, beginning of period
−Removed: Other comprehensive income
−Removed: Issuance of Common Shares of Beneficial Interest
−Removed: Redemption of Preferred Shares
−Removed: Issuance of partnership interest in consolidated real estate venture
−Removed: Distributions from consolidated real estate venture
−Removed: Equity issuance costs
−Removed: Bonus share issuance
−Removed: Share-based compensation activity
−Removed: Share Issuance from/(to) Deferred Compensation Plan
−Removed: Share Choice Plan issuance
−Removed: Reallocation of Noncontrolling Interest
−Removed: Preferred Share distributions
−Removed: Preferred Share redemption charges
−Removed: Distributions declared ($0.66 per share)
+Added: Number of Common Shares Number of Rabbi Trust/Deferred Compensation Shares Common Shares of Brandywine Realty Trust's beneficial interest Additional Paid-in Capital Deferred Compensation Payable in Common Shares Common Shares in Grantor Trust Cumulative Earnings Accumulated Other Comprehensive Income (Loss) Cumulative Distributions Noncontrolling Interests Total
BALANCE, December 31, 2017 178,285,236 894,736 $ 1,784 $ 3,218,077 $ 12,445 $ ( 12,445 ) $ 641,093 $ 2,399 $ ( 2,053,741 ) $ 17,258 $ 1,826,870
+Added: Net income 134,518 954 135,472
Other comprehensive income 2,630 39 2,669
11 unchanged sentences
Cumulative effect of accounting change ( 5,336 ) ( 5,336 )
+Added: Net income 34,267 262 34,529
Other comprehensive loss ( 7,399 ) ( 41 ) ( 7,440 )
8 unchanged sentences
BALANCE, December 31, 2019 176,480,095 1,105,542 $ 1,766 $ 3,192,158 $ 16,216 $ ( 16,216 ) $ 804,556 $ ( 2,370 ) $ ( 2,318,233 ) $ 10,426 $ 1,688,303
+Added: Net income 305,527 1,799 307,326
+Added: Other comprehensive loss ( 5,191 ) ( 29 ) ( 5,220 )
+Added: Repurchase and retirement of Common Shares of Beneficial Interest ( 6,248,483 ) ( 62 ) ( 59,937 ) ( 59,999 )
+Added: Sale of partnership interest in consolidated real estate venture ( 1,017 ) ( 1,017 )
+Added: Distributions from consolidated real estate ventures ( 22 ) ( 22 )
+Added: Share-based compensation activity 309,096 50,967 3 6,233 6,236
+Added: Share Issuance from/(to) Deferred Compensation Plan 32,256 3,985 ( 206 ) 1,300 ( 1,300 ) ( 206 )
+Added: Reallocation of Noncontrolling interest ( 96 ) 96 —
+Added: Distributions declared ($0.76 per share) ( 130,005 ) ( 748 ) ( 130,753 )
+Added: BALANCE, December 31, 2020 170,572,964 1,160,494 $ 1,707 $ 3,138,152 $ 17,516 $ ( 17,516 ) $ 1,110,083 $ ( 7,561 ) $ ( 2,448,238 ) $ 10,505 $ 1,804,648
The accompanying notes are an integral part of these consolidated financial statements.
3 unchanged sentences
Year Ended December 31,
+Added: 2020 2019 2018
Cash flows from operating activities:
+Added: Net income $ 307,326 $ 34,529 $ 135,472
Adjustments to reconcile net income to net cash from operating activities:
13 unchanged sentences
Other than temporary impairment — — 4,076
−Removed: Income from Real Estate Ventures, net of distributions
+Added: Loss from Real Estate Ventures, net of distributions 18,584 10,242 12,871
Income tax provision (benefit) ( 224 ) 12 423
1 unchanged sentence
Accounts receivable ( 2,031 ) ( 248 ) 3,524
+Added: Other assets ( 5,034 ) 9,368 ( 14,334 )
Accounts payable and accrued expenses 14,374 ( 5,599 ) 12,579
7 unchanged sentences
Proceeds from real estate venture sales — 9,730 60,346
+Added: Issuance of note receivable ( 50,000 ) — —
Issuance of mortgage note receivable — — ( 175,172 )
16 unchanged sentences
Proceeds from unsecured notes — 216,373 —
−Removed: Repayments of unsecured notes
Debt financing costs paid — ( 1,965 ) ( 3,430 )
−Removed: Redemption of preferred shares
Proceeds from the exercise of stock options 47 3,771 —
19 unchanged sentences
Year Ended December 31,
+Added: 2020 2019 2018
Supplemental disclosure:
13 unchanged sentences
Change in mortgage notes payable related to acquisition of an operating property — — 9,940
+Added: Change in operating real estate from deconsolidation of operating properties 427,710 — —
+Added: Change in investment in real estate ventures from deconsolidation of operating properties ( 296,262 ) — —
+Added: Change in mortgage notes payable from deconsolidation of operating properties ( 220,271 ) — —
Change in capital expenditures financed through accounts payable at period end ( 9,949 ) ( 10,618 ) 8,784
+Added: Change in other assets as a result of deconsolidation of operating properties 1,471 — —
Change in capital expenditures financed through retention payable at period end 284 ( 946 ) ( 2,912 )
3 unchanged sentences
(in thousands, except unit and per unit information)
−Removed: December 31, 2019
−Removed: December 31, 2018
+Added: December 31, 2020 December 31, 2019
Real estate investments:
10 unchanged sentences
Accounts receivable, net of allowance of $ 0 and $ 284 as of December 31, 2020 and December 31, 2019, respectively
+Added: 13,536 16,363
Accrued rent receivable, net of allowance of $ 5,086 and $ 7,691 as of December 31, 2020 and December 31, 2019, respectively
+Added: 155,372 174,144
Investment in Real Estate Ventures, equity method 401,327 120,294
1 unchanged sentence
Intangible assets, net 48,570 84,851
+Added: Other assets 176,747 115,678
+Added: Total assets $ 3,900,106 $ 4,075,969
LIABILITIES AND PARTNERS' EQUITY
Mortgage notes payable, net $ — $ 313,812
−Removed: Unsecured credit facility
Unsecured term loan, net 249,084 248,561
9 unchanged sentences
Redeemable limited partnership units at redemption value;
−Removed: 981,634 and 982,871 issued and outstanding as of December 31, 2019 and December 31, 2018, respectively
+Added: 981,634 issued and outstanding as of December 31, 2020 and December 31, 2019 11,566 15,388
Brandywine Operating Partnership, L.P.'s equity:
1 unchanged sentence
170,572,964 and 176,480,095 units issued and outstanding as of December 31, 2020 and December 31, 2019, respectively 1,800,945 1,674,539
−Removed: Accumulated other comprehensive income
+Added: Accumulated other comprehensive loss ( 7,935 ) ( 2,715 )
Total Brandywine Operating Partnership, L.P.'s equity 1,793,010 1,671,824
7 unchanged sentences
Year Ended December 31,
+Added: 2020 2019 2018
+Added: Rents $ 513,504 $ 554,665 $ 515,044
Third party management fees, labor reimbursement and leasing 18,580 19,626 22,557
+Added: Other 2,768 6,126 6,744
Total revenue 534,852 580,417 544,345
22 unchanged sentences
Income tax (provision) benefit 224 ( 12 ) ( 423 )
+Added: Net income 307,326 34,529 135,472
Net income attributable to noncontrolling interests - consolidated real estate ventures ( 20 ) ( 69 ) ( 55 )
Net income attributable to Brandywine Operating Partnership 307,306 34,460 135,417
−Removed: Distribution to preferred unitholders
−Removed: Preferred unit redemption charge
Nonforfeitable dividends allocated to unvested restricted unitholders ( 410 ) ( 396 ) ( 369 )
Net income attributable to Common Partnership Unitholders of Brandywine Operating Partnership, L.P.
+Added: $ 306,896 $ 34,064 $ 135,048
Basic income per Common Partnership Unit $ 1.77 $ 0.19 $ 0.75
7 unchanged sentences
Year Ended December 31,
+Added: 2020 2019 2018
+Added: Net income $ 307,326 $ 34,529 $ 135,472
Comprehensive income (loss):
11 unchanged sentences
(in thousands, except Units)
−Removed: Series E-Linked Preferred Mirror Units
General Partner Capital
−Removed: Accumulated Other Comprehensive Income (Loss)
−Removed: Noncontrolling Interest - Consolidated Real Estate Ventures
−Removed: Total Partners' Equity
−Removed: BALANCE, beginning of period
−Removed: Other comprehensive income
−Removed: Redemption of Preferred Mirror Units
−Removed: Deferred compensation obligation
−Removed: Issuance of LP Units
−Removed: Issuance of partnership interest in consolidated real estate venture
−Removed: Distributions from consolidated real estate venture
−Removed: Share Choice Plan issuance
−Removed: Bonus share issuance
−Removed: Share-based compensation activity
−Removed: Adjustment of redeemable partnership units to liquidation value at period end
−Removed: Distributions to Preferred Mirror Units
−Removed: Preferred Mirror Units redemption charge
−Removed: Distributions declared to general partnership unitholders ($0.66 per unit)
+Added: Units Amount Accumulated Other Comprehensive Income (Loss) Noncontrolling Interest - Consolidated Real Estate Ventures Total Partners' Equity
BALANCE, December 31, 2017 178,285,236 $ 1,795,684 $ 2,056 $ 2,215 $ 1,799,955
+Added: Net income 135,417 55 135,472
Other comprehensive income 2,669 2,669
10 unchanged sentences
Cumulative effect of accounting change ( 5,336 ) ( 5,336 )
+Added: Net income 34,460 69 34,529
Other comprehensive loss ( 7,440 ) ( 7,440 )
8 unchanged sentences
BALANCE, December 31, 2019 176,480,095 $ 1,674,539 $ ( 2,715 ) $ 1,091 $ 1,672,915
+Added: Net income 307,306 20 307,326
+Added: Other comprehensive loss ( 5,220 ) ( 5,220 )
+Added: Deferred compensation obligation 32,256 ( 206 ) ( 206 )
+Added: Repurchase and retirement of LP units ( 6,248,483 ) ( 59,999 ) ( 59,999 )
+Added: Distributions from consolidated real estate ventures ( 22 ) ( 22 )
+Added: Share-based compensation activity 309,096 6,236 6,236
+Added: Sale of partnership interest to consolidated real estate venture ( 1,017 ) ( 1,017 )
+Added: Adjustment of redeemable partnership units to liquidation value at period end 3,074 3,074
+Added: Distributions declared to general partnership unitholders ($0.76 per unit) ( 130,005 ) ( 130,005 )
+Added: BALANCE, December 31, 2020 170,572,964 $ 1,800,945 $ ( 7,935 ) $ 72 $ 1,793,082
The accompanying notes are an integral part of these consolidated financial statements.
3 unchanged sentences
Year Ended December 31,
+Added: 2020 2019 2018
Cash flows from operating activities:
+Added: Net income $ 307,326 $ 34,529 $ 135,472
Adjustments to reconcile net income to net cash from operating activities:
13 unchanged sentences
Other than temporary impairment — — 4,076
−Removed: Income from Real Estate Ventures, net of distributions
+Added: Loss from Real Estate Ventures, net of distributions 18,584 10,242 12,871
Income tax provision (benefit) ( 224 ) 12 423
1 unchanged sentence
Accounts receivable ( 2,031 ) ( 248 ) 3,524
+Added: Other assets ( 5,034 ) 9,368 ( 14,334 )
Accounts payable and accrued expenses 14,374 ( 5,599 ) 12,579
7 unchanged sentences
Proceeds from real estate venture sales — 9,730 60,346
+Added: Issuance of note receivable ( 50,000 ) — —
Issuance of mortgage note receivable — — ( 175,172 )
16 unchanged sentences
Proceeds from unsecured notes — 216,373 —
−Removed: Repayments of unsecured notes
Debt financing costs paid — ( 1,965 ) ( 3,430 )
−Removed: Redemption of preferred shares
Proceeds from the exercise of stock options 47 3,771 —
18 unchanged sentences
Year Ended December 31,
+Added: 2020 2019 2018
Supplemental disclosure:
13 unchanged sentences
Change in mortgage notes payable related to acquisition of an operating property — — 9,940
+Added: Change in operating real estate from deconsolidation of operating properties 427,710 — —
+Added: Change in investment in real estate ventures from deconsolidation of operating properties ( 296,262 ) — —
+Added: Change in mortgage notes payable from deconsolidation of operating properties ( 220,271 ) — —
Change in capital expenditures financed through accounts payable at period end ( 9,949 ) ( 10,618 ) 8,784
+Added: Change in other assets as a result of deconsolidation of operating properties 1,471 — —
Change in capital expenditures financed through retention payable at period end 284 ( 946 ) ( 2,912 )
8 unchanged sentences
As of December 31, 2020, the Company owned 82 properties that contained an aggregate of approximately 13.9 million net rentable square feet (collectively, the “Properties”).
−Removed: The Company’s core portfolio of operating properties, as of December 31, 2019 , excludes one development property and four redevelopment properties under construction or committed for construction (collectively, the “Core Properties”).
+Added: The Company’s core portfolio of operating properties (the “Core Properties”) excludes development properties, redevelopment properties, and properties held for sale.
The Properties were comprised of the following as of December 31, 2020:
−Removed: Number of Properties
−Removed: Rentable Square Feet
+Added: Number of Properties Rentable Square Feet
Office properties 73 12,470,257
4 unchanged sentences
The Properties 82 13,852,464
−Removed: In addition to the Properties, as of December 31, 2019 , the Company owned land held for development comprised of 234.7 acres of undeveloped land, of which 35.2 acres were held for sale.
+Added: In addition to the Properties, as of December 31, 2020, the Company owned 228.5 acres of land held for development, of which 35.2 acres were held for sale.
The Company also held leasehold interests in two land parcels totaling 1.8 acres, each acquired through prepaid 99-year ground leases, and held options to purchase approximately 55.5 additional acres of undeveloped land.
−Removed: As of December 31, 2019 , the total potential development that these land parcels could support, under current zoning and entitlements, including the parcels under option, amounted to an estimated 14.2 million square feet, of which 0.2 million square feet relates to the 35.2 acres held for sale.
−Removed: As of December 31, 2019 , the Company also owned economic interests in seven unconsolidated real estate ventures (collectively, the “Real Estate Ventures”) (see Note 4, ''Investment in Unconsolidated Real Estate Ventures ” for further information).
+Added: As of December 31, 2020, the total potential development that this inventory of land could support under current zoning and entitlements, including the parcels under option, amounted to an estimated 14.2 million square feet, of which 0.2 million square feet relates to 35.2 acres held for sale.
+Added: As of December 31, 2020, the Company also owned economic interests in nine unconsolidated real estate ventures (collectively, the “Real Estate Ventures”) (see Note 4, ''Investment in Unconsolidated Real Estate Ventures ” for further information).
The Properties and the properties owned by the Real Estate Ventures are located in or near Philadelphia, Pennsylvania;
4 unchanged sentences
All references to building square footage, rentable square feet, acres, occupancy percentage, the number of buildings, and tax basis are unaudited.
−Removed: The Company conducts its third-party real estate management services business primarily through six management companies (collectively, the “Management Companies”):
+Added: The Company conducts its third-party real estate management services business primarily through seven management companies (collectively, the “Management Companies”):
Brandywine Realty Services Corporation (“BRSCO”), BDN Management Inc.
1 unchanged sentence
(“BPI”), BDN Brokerage, LLC (“BBL”), Brandywine Properties Management, L.P.
−Removed: (“BPM”) and Brandywine Brokerage Services, LLC (“BBS”).
+Added: (“BPM”), Brandywine Brokerage Services, LLC (“BBS”), and BDN GC Services LLC ("BGCS").
BRSCO, BMI and BPI are each a taxable REIT subsidiary.
−Removed: BBS, BBL, and BPM are tax disregarded entities wholly owned by the taxable REIT subsidiary entities.
−Removed: As of December 31, 2019 , the Operating Partnership owned, directly and indirectly, 100 % of each of BRSCO, BMI, BPI, BBL, BPM and BBS.
+Added: BBS, BBL, BPM, and BGCS are tax disregarded entities wholly owned by the taxable REIT subsidiary entities.
+Added: As of December 31, 2020, the Operating Partnership owned, directly and indirectly, 100 % of each of BRSCO, BMI, BPI, BBL, BPM, BBS, and BGCS.
As of December 31, 2020, the Management Company subsidiaries were managing properties containing an aggregate of approximately 24.7 million net rentable square feet, of which approximately 13.9 million net rentable square feet related to Properties owned by the Company and approximately 10.8 million net rentable square feet related to properties owned by third parties and Real Estate Ventures.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
−Removed: Revision of Previously Issued Financial Statements
−Removed: The Company’s comparative 2017 and 2018 results have been adjusted to correct for the effects of errors discovered during the second quarter of 2019 relating to the purchase price allocation and depreciable lives for two acquisitions made in a prior period.
−Removed: The Company has evaluated the impact of the errors to the previously issued financial statements and concluded that the errors were immaterial to the previously issued financial statements;
−Removed: however, to correct the cumulative effect of the errors in 2019 would significantly impact the 2019 financial statements.
−Removed: Accordingly, the previously issued financial statements have been corrected.
−Removed: The corrections to the balance sheets include a reduction in cumulative earnings and operating properties and an increase to accumulated depreciation.
−Removed: The corrections to the prior period income statements result in an increase in depreciation and amortization and property operating expenses in each period, and an increase in net gain on disposition of real estate for the for the twelve months ended December 31, 2017.
−Removed: In addition, the impact of an immaterial out of period depreciation adjustment, which was previously disclosed in the Company’s Quarterly Report on Form 10-Q for the three months ended March 31, 2019, has been reflected in the correct period.
−Removed: The following tables and paragraphs present line items of the previously issued financial statements that have been corrected as a result of the revision:
−Removed: Balance sheet impacts (in thousands) :
−Removed: December 31, 2018
−Removed: Balance Sheet:
−Removed: As previously reported
−Removed: Assets (Parent Company and Operating Partnership)
−Removed: Operating properties
−Removed: Accumulated depreciation
−Removed: Operating real estate investments, net
−Removed: Equity (Parent Company)
−Removed: Additional Paid-in Capital
−Removed: Cumulative Earnings
−Removed: Total Brandywine Realty Trust's equity
−Removed: Noncontrolling interests
−Removed: Total beneficiaries' equity
−Removed: Total liabilities and beneficiaries' equity
−Removed: Equity (Operating Partnership)
−Removed: General Partnership Capital
−Removed: Total Brandywine Operating Partnership, L.P.'s equity
−Removed: Total partners' equity
−Removed: Total liabilities and partners' equity
−Removed: Statement of Beneficiaries’ / Partners’ Equity impacts (in thousands):
−Removed: Twelve months ended December 31, 2018
−Removed: Brandywine Realty Trust
−Removed: As previously reported
−Removed: Statement of Beneficiaries' Equity:
−Removed: Additional paid-in capital, beginning of period
−Removed: Cumulative earnings, beginning of period
−Removed: Noncontrolling interest, beginning of period
−Removed: Additional paid-in capital, December 31, 2018
−Removed: Cumulative earnings, December 31, 2018
−Removed: Noncontrolling interests, December 31, 2018
−Removed: Brandywine Operating Partnership
−Removed: Statement of Partners' Equity:
−Removed: Partner Capital, beginning of period
−Removed: Partner Capital, December 31, 2018
−Removed: Twelve months ended December 31, 2017
−Removed: Brandywine Realty Trust
−Removed: As previously reported
−Removed: Statement of Beneficiaries' Equity:
−Removed: Additional paid-in capital, beginning of period
−Removed: Cumulative earnings, beginning of period
−Removed: Noncontrolling interest, beginning of period
−Removed: Additional paid-in capital, December 31, 2017
−Removed: Cumulative earnings, December 31, 2017
−Removed: Noncontrolling interests, December 31, 2017
−Removed: Brandywine Operating Partnership
−Removed: Statement of Partners' Equity:
−Removed: Partner Capital, beginning of period
−Removed: Partner Capital, December 31, 2017
−Removed: Statement of Operations impacts:
−Removed: Net income for the twelve months ended December 31, 2018 and 2017 has been reduced by $ 1.8 million and $ 0.7 million respectively, with a $ 0.01 decrease to basic and diluted income per common share and per common partnership unit for the twelve months ended December 31, 2018.
−Removed: There was a $ 0.01 decrease to basic income per common share and per common partnership unit for the twelve months ended December 31, 2017.
−Removed: There was no change to the previously reported diluted income per common share or per common partnership unit for the twelve months ended December 31, 2017.
−Removed: There were no impacts to cash flows from operating activities in any period.
Principles of Consolidation
2 unchanged sentences
The primary beneficiary is defined by the entity having both of the following characteristics:
−Removed: (i) the power to direct those matters that most significantly impact the activities of the VIE and (ii) the obligation to absorb losses or the right to receive benefits of the VIE that could
−Removed: potentially be significant to the VIE.
+Added: (i) the power to direct those matters that most significantly impact the activities of the VIE and (ii) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE.
For entities that the Company has the obligations to fund losses, its maximum exposure to loss is not limited to the carrying amount of its investments.
22 unchanged sentences
The Company generally expects that acquisitions of real estate or in-substance real estate will not meet the definition of business and therefore are accounted for as asset acquisitions, unless specifically noted otherwise.
−Removed: The accounting model for asset acquisitions is similar to the accounting model for business combinations except that the acquisition consideration (including acquisition costs) is allocated to the individual assets acquired and liabilities assumed on a relative fair value basis.
+Added: accounting model for asset acquisitions is similar to the accounting model for business combinations except that the acquisition consideration (including acquisition costs) is allocated to the individual assets acquired and liabilities assumed on a relative fair value basis.
As a result, asset acquisitions do not result in recognition of goodwill or a bargain purchase gain.
3 unchanged sentences
The purchase price is allocated to the acquired assets and assumed liabilities, including land and buildings, as if vacant based on highest and best use for the acquired assets.
−Removed: The Company assesses and considers fair value of the operating properties based on estimated cash flow projections that utilize discount and/or capitalization rates that it deems appropriate, as well as available
−Removed: market information.
+Added: The Company assesses and considers fair value of the operating properties based on estimated cash flow projections that utilize discount and/or capitalization rates that it deems appropriate, as well as available market information.
Estimates of future cash flows are based on a number of factors including the historical operating results, known and anticipated trends, and market and economic conditions.
29 unchanged sentences
The base IBR is estimated utilizing observable mortgage and corporate bond rates, which are then adjusted to account for considerations related to the Company’s credit rating and the lease term to select an incremental borrowing rate for each lease.
−Removed: The right of use assets and lease liabilities are presented as “Right of use asset - operating leases” and “Lease liability - operating leases”, respectively, on the consolidated balance sheet as of December 31, 2019.
+Added: The right of use assets and lease liabilities are presented as “Right of use asset - operating leases, net” and “Lease liability - operating leases”, respectively, on the consolidated balance sheet as of December 31, 2020.
The lease liabilities and right of use assets are amortized on a straight-line basis over the lease term with the corresponding expense classified in “Property operating expenses” on the consolidated statements of operations.
26 unchanged sentences
The Company maintains cash equivalents in money market accounts with financial institutions in excess of insured limits, but believes this risk is mitigated by only investing in or through major financial institutions.
−Removed: The Company does not invest its available cash balances in money
−Removed: market funds.
+Added: The Company does not invest its available cash balances in money market funds.
As such, available cash balances are appropriately reflected as cash and cash equivalents on the consolidated balance sheets.
11 unchanged sentences
For tenant receivables, the allowance is calculated by applying a range of loss percentages to receivable aging categories.
−Removed: For accrued rent receivables, the allowance is calculated by assigning risk factors by industry which are primarily based on the Company's historical collection and charge-off experience adjusted for current market conditions, which requires management's judgment.
+Added: For accrued rent receivables, the allowance is generally calculated by assigning risk factors by industry which are primarily based on the Company's historical collection and charge-off experience adjusted for current market conditions, which requires management's judgment.
Investments in Unconsolidated Real Estate Ventures
15 unchanged sentences
Interest income is recognized over the term of the notes receivable and is calculated based on the contractual terms of each note agreement.
+Added: At inception and on a quarterly basis, the Company evaluates notes receivable for the current estimate of expected credit losses over the contractual term using a probability-of-default method and reports in net income (as a credit loss expense) the amount necessary to adjust the allowance for credit losses to reflect management's current estimate.
+Added: Management considers performance and/or value of the underlying collateral property as well as the financial and operating capability of the borrower/sponsor in its evaluation.
Notes receivable are placed on nonaccrual status when management determines, after considering economic and business conditions and collection efforts, that the loans are impaired, or collection of interest is doubtful.
20 unchanged sentences
The Company’s lease revenue is impacted by the Company’s determination of whether improvements to the property, whether made by the Company or by the tenant, are landlord assets.
−Removed: The determination of whether an improvement is a landlord asset requires judgment.
+Added: The determination of whether an improvement is a
+Added: landlord asset requires judgment.
In making this judgment, the Company’s primary consideration is whether an improvement would be utilizable by another tenant upon the then-existing tenant vacating the improved space.
6 unchanged sentences
Additionally, any deferred rents receivable are accelerated over the modified lease term.
−Removed: The Company’s leases also typically provide for tenant reimbursement of a portion of common area maintenance expenses and other operating expenses to the extent that a tenant’s pro rata share of expenses exceeds a base year level set in the lease or to
−Removed: the extent that the tenant has a lease on a triple net basis.
+Added: The Company’s leases also typically provide for tenant reimbursement of a portion of common area maintenance expenses and other operating expenses to the extent that a tenant’s pro rata share of expenses exceeds a base year level set in the lease or to the extent that the tenant has a lease on a triple net basis.
As the timing and pattern of revenue recognition is the same, rents and tenant reimbursements are treated as a combined lease component and included in the "Rents" caption within the Company's consolidated statements of operations.
18 unchanged sentences
The Company acts as the principal construction company for the real estate ventures and records gross revenue as it provides construction services based on the quantifiable construction outputs.
−Removed: In applying the cost based output method of revenue recognition, the Company uses the actual costs incurred relative to the total estimated costs to determine its progress towards contract completion and to calculate the corresponding gross revenue and gross profit to recognize.
+Added: In applying the cost based output method of revenue recognition, the Company uses the actual costs incurred relative to the total estimated costs to determine its progress towards contract completion and to calculate the corresponding gross revenue
+Added: and gross profit to recognize.
For any costs that do not contribute to satisfying the Company’s performance obligations, it excludes such costs from its output methods of revenue recognition as the amounts are not reflective of transferring control of the outputs to the customer.
1 unchanged sentence
The following is a summary of revenue earned by the Company’s reportable segments (see Note 19, ''Segment Information,” for further information) during the year ended December 31, 2020 (in thousands):
−Removed: Philadelphia CBD
−Removed: Pennsylvania Suburbs
−Removed: Austin, Texas
−Removed: Metropolitan Washington, D.C.
−Removed: Corporate (a)
+Added: Philadelphia CBD Pennsylvania Suburbs Austin, Texas Metropolitan Washington, D.C.
+Added: Other Corporate (a) Total
+Added: Fixed rent $ 166,286 $ 128,044 $ 63,366 $ 29,830 $ 8,064 $ ( 2,412 ) $ 393,178
Variable rent 51,410 12,951 35,123 3,544 2,401 ( 1,343 ) 104,086
2 unchanged sentences
Daily parking & hotel flexible stay 10,777 179 49 135 232 — 11,372
+Added: Total rents 229,619 141,162 102,069 33,509 10,900 ( 3,755 ) 513,504
Third party management fees, labor reimbursement and leasing 927 39 689 6,541 2,560 7,824 18,580
+Added: Other income 1,482 412 224 173 9 468 2,768
Total revenue $ 232,028 $ 141,613 $ 102,982 $ 40,223 $ 13,469 $ 4,537 $ 534,852
−Removed: Corporate includes intercompany eliminations necessary to reconcile to consolidated Company totals.
+Added: The following is a summary of revenue earned by the Company’s reportable segments (see Note 19, ''Segment Information,” for further information) during the year ended December 31, 2019 (in thousands):
+Added: Philadelphia CBD Pennsylvania Suburbs Austin, Texas Metropolitan Washington, D.C.
+Added: Other Corporate (a) Total
+Added: Fixed rent $ 178,481 $ 125,969 $ 62,232 $ 39,420 $ 7,834 $ ( 2,412 ) $ 411,524
+Added: Variable rent 58,580 14,282 34,748 4,029 3,080 ( 495 ) 114,224
+Added: Total lease revenue 237,061 140,251 96,980 43,449 10,914 ( 2,907 ) 525,748
+Added: Amortization of deferred market rents 3,745 ( 12 ) 4,638 — 486 — 8,857
+Added: Daily parking & hotel flexible stay 18,665 174 165 824 232 — 20,060
+Added: Total rents 259,471 140,413 101,783 44,273 11,632 ( 2,907 ) 554,665
+Added: Third party management fees, labor reimbursement and leasing 876 43 1,956 6,922 2,915 6,914 19,626
+Added: Other income 3,422 628 418 303 11 1,344 6,126
+Added: Total revenue $ 263,769 $ 141,084 $ 104,157 $ 51,498 $ 14,558 $ 5,351 $ 580,417
+Added: (a) Corporate includes intercompany eliminations necessary to reconcile to consolidated Company totals.
Parent Company
38 unchanged sentences
The 1997 Plan is administered by the Compensation Committee of the Parent Company’s Board of Trustees.
−Removed: Under the 1997 Plan, the Compensation Committee is authorized to award equity and equity-based awards, including incentive stock options, non-qualified stock options, restricted shares and performance-based shares.
+Added: Under the 1997 Plan, the Compensation Committee is authorized to award equity and equity-based awards, including incentive stock options, non-qualified stock options, restricted share rights and performance-based share units.
The Company's share-based employee compensation plan is described more fully in Note 15, ''Share Based Compensation, 401(k) Plan and Deferred Compensation."
13 unchanged sentences
The accounting standard defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.
−Removed: It also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.
+Added: It also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair
The standard describes three levels of inputs that may be used to measure fair value.
9 unchanged sentences
The fair value assigned to the long-lived assets and equity method investments for which there was impairment recorded utilize Level 3 inputs .
−Removed: New Accounting Pronouncements Adopted
−Removed: In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), modifying the principles for the recognition, measurement, presentation, and disclosure of leases for both parties to a contract (i.e., lessees and lessors).
−Removed: The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee.
−Removed: This classification determines whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease, respectively.
−Removed: A lessee is also required to record a right-of-use asset and lease liability for all leases with a term of greater than twelve months regardless of their classification.
−Removed: Leases with a term of twelve months or less will be accounted for in the same manner as operating leases under ASC 840, Leases.
−Removed: The new standard requires lessors to account for leases using an approach that is substantially equivalent to previous guidance for sales-type leases, direct financing leases, and operating leases.
−Removed: The guidance supersedes previously issued guidance under ASC 840.
−Removed: The Company adopted Topic 842 effective January 1, 2019.
−Removed: In applying the modified retrospective transition method, the Company elected the package of practical expedients available for implementation, which allows for the following:
−Removed: An entity need not reassess whether any expired or existing contracts are or contain leases;
−Removed: An entity need not reassess the lease classification for any expired or existing leases;
−Removed: An entity need not reassess initial direct costs for any existing leases.
−Removed: Furthermore, the Company elected the optional transition method to make January 1, 2019 the initial application date of the standard.
−Removed: This package of practical expedients allows entities to account for their existing leases for the remainder of their respective lease terms following the previous accounting guidance.
−Removed: The Company also elected to adopt the optional transition practical expedient provided in ASU 2018-01 to not evaluate under Topic 842 for existing or expired land easements prior to the application date to determine if they meet the definition of a lease.
−Removed: The Company also elected to adopt the practical expedient offered in ASU 2018-11 that allows lessors to not allocate the total consideration to lease and nonlease components, such as tenant reimbursements, based on their relative standalone selling prices as the timing and pattern of revenue recognition of the combined single lease component is the same and the leases are classified as operating leases.
−Removed: The Company elected to adopt ASU 2018-20, which allows lessors to not evaluate whether certain sales taxes and other similar taxes are lessor costs or lessee costs.
−Removed: Instead, lessors will account for those costs as if they are lessee costs.
−Removed: All collections from lessees of taxes within the scope of the election are excluded from the consideration of the contract and from variable payments not included in the consideration of the contract.
−Removed: The Company has evaluated all leases for collectability and is recognizing lease payments for certain leases on a cash basis because collectability of substantially all of the lease payments is not probable.
−Removed: As a result, the write off of the accrued rent receivable of $ 0.7 million was recorded by the Company upon adoption of Topic 842 as a cumulative effect of accounting change adjustment to equity through “Cumulative earnings” on the consolidated balance sheets.
−Removed: While adoption of the practical expedient allows the Company to not revisit the classification of existing leases, the Company measured the present value of the future lease payments for each ground lease agreement for which the Company is the lessor and recognized a right of use asset and lease liability in the aggregate amount of $ 22.4 million , each as of January 1, 2019.
−Removed: New Accounting Pronouncements Issued but not yet Adopted
+Added: Risks and Uncertainties - COVID-19
+Added: Currently, one of the most significant risks and uncertainties the Company faces is the potential adverse effect of the ongoing global COVID-19 pandemic, which has significantly slowed global economic activity, caused significant volatility in financial markets, and resulted in unprecedented job losses, causing many to fear an imminent global recession.
+Added: The responses of many countries, including the U.S., have included mandatory quarantines, restrictions on business activities, including construction activities, restrictions on group gatherings, restrictions on travel and mandatory closures.
+Added: These actions are creating disruption in the global economy and supply chains and adversely impacting many industries, including owners and developers of real estate.
+Added: Moreover, there is significant uncertainty around the breadth and duration of business disruptions related to the COVID-19 pandemic, as well as its impact on the U.S.
+Added: economy and consumer confidence.
+Added: Demand for space at the Company's properties is dependent on a variety of macroeconomic factors, such as employment levels, interest rates, changes in stock market valuations, rent levels and availability of competing space.
+Added: The extent to which the COVID-19 pandemic impacts the Company's results will depend on future developments, many of which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19, future action plans, and vaccination efforts.
+Added: The COVID-19 pandemic has caused continued negative economic impacts, market volatility, and business disruption, which could negatively impact the Company's tenants’ ability to pay rent, the Company's ability to lease vacant space, and the Company's ability to complete development and redevelopment projects.
+Added: These consequences, in turn, could materially impact the Company's results of operations.
+Added: Recent Accounting Pronouncements
+Added: In May 2020, the SEC adopted amendments to requirements for companies relating to significant acquisitions and dispositions of businesses as well as amendments to the significance tests in the ‘significant subsidiary’ definition.
+Added: Additionally, significant modifications were made to the requirements related to the presentation of pro forma financial information.
+Added: The amendments are effective on January 1, 2021, with voluntary compliance permitted in advance of the effective date.
+Added: The Company has elected to early adopt the amendments as of September 30, 2020.
+Added: On April 10, 2020, the FASB issued a Staff Q&A to respond to some frequently asked questions about accounting for lease concessions related to the effects of the COVID-19 pandemic.
+Added: Consequently, for concessions related to the effects of the COVID-19 pandemic, an entity will not have to analyze each contract to determine whether enforceable rights and obligations for concessions exist in the contract and can elect to apply or not apply the lease modification guidance to those contracts.
+Added: Entities may make the elections for any lessor-provided concession related to the effects of the COVID-19 pandemic (e.g., deferrals of lease payments, cash payments made to the lessee, reduced future lease payments) as long as the concession does not result in a substantial increase in the rights of the lessor or the obligations of the lessee.
+Added: The Company has elected to account for lease concessions as though the enforceable rights and obligations for the concessions existed in the
+Added: original lease.
+Added: To date, the impact of lease concessions granted has not had a material effect on the Company's financial statements.
+Added: The Company continues to evaluate the impact of lease concessions and the appropriate accounting for those concessions.
+Added: In March 2020, the FASB issued ASU 2020-04 Reference Rate Reform (Topic 848) Facilitation of the Effects of Reference Rate Reform on Financial Reporting.
+Added: The amendments provide practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts.
+Added: The guidance is optional and is effective between March 12, 2020 and December 31, 2022.
+Added: The guidance may be elected over time as reference rate reform activities occur.
+Added: The Company continues to evaluate the impact of the guidance and may apply elections as applicable as additional changes in the market occur.
In June 2016, the FASB issued ASU No.
2 unchanged sentences
In November 2018, the FASB released ASU 2018-19, Codification Improvements to Topic 326, Financial Instrument - Credit Losses, which clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20.
−Removed: The guidance is effective for the Company on January 1, 2020.
−Removed: The Company has evaluated the impact of this new guidance on reserves for notes receivable, and has concluded that the guidance will not have a material impact on its consolidated financial statements.
+Added: The guidance was effective for the Company as of January 1, 2020.
+Added: The Company adopted ASU 2016-13 effective January 1, 2020 and it did not have a material impact on the consolidated financial statements.
REAL ESTATE INVESTMENTS
As of December 31, 2020 and 2019, the gross carrying value of the operating properties was as follows (in thousands):
−Removed: December 31, 2019
−Removed: December 31, 2018
+Added: December 31, 2020 December 31, 2019
+Added: Land $ 407,514 $ 489,702
Building and improvements 2,665,232 3,049,395
Tenant improvements 401,363 467,362
+Added: Total $ 3,474,109 $ 4,006,459
Construction-in-Progress
2 unchanged sentences
The following table shows the amount of compensation costs (including bonuses and benefits) capitalized for the years presented (in thousands):
+Added: 2020 2019 2018
+Added: Development $ 4,802 $ 3,047 $ 3,185
Redevelopment 543 775 968
Tenant Improvements 3,021 3,609 2,811
+Added: Total $ 8,366 $ 7,431 $ 6,964
2020 Acquisitions
+Added: The following table summarizes the property acquisitions during the year ended December 31, 2020 (dollars in thousands):
+Added: Property/Portfolio Name Acquisition Date Location Property Type Rentable Square Feet/Acres Purchase Price (a)
+Added: 145 King of Prussia Road February 27, 2020 Radnor, PA Land 7.75 acres
+Added: 1505-11 Race Street November 5, 2020 Philadelphia, PA Office 119,763 $ 9,700
+Added: 250 King of Prussia Road (b) November 30, 2020 Radnor, PA Office 169,843 $ 20,250
+Added: (a) Exclusive of transaction costs and price adjustments.
+Added: See purchase price allocation table below for a breakout of the net purchase price for wholly owned properties.
+Added: (b) This property was placed into redevelopment and is therefore included within Construction-in-progress on the consolidated balance sheets.
+Added: The Company accounted for the acquisition of 1501-11 Race Street as an asset acquisition and therefore capitalized $ 0.3 million of acquisition related costs.
+Added: The Company utilized a number of sources in making estimates of fair value (including comparative sales transactions and market leasing assumptions) for purposes of allocating the purchase price to tangible and intangible assets acquired The acquisition values have been allocated as follows (in thousands):
+Added: 1505-11 Race Street
+Added: Building, land and improvements $ 9,723
+Added: Intangible assets acquired 2,422
+Added: Below market lease liabilities assumed ( 2,193 )
+Added: Total unencumbered acquisition value 9,952
+Added: Amortization period of intangible assets 1.5 years
+Added: Amortization period of below market liabilities assumed 1.5 years
+Added: 2019 Acquisitions
During the year ended December 31, 2019, the Company did not acquire any properties from a third party.
13 unchanged sentences
The Company recognized a $ 28.3 million gain on its promoted interest in the Austin Venture, reflected in the caption “Gain on promoted interest in unconsolidated real estate venture” in the consolidated statements of operations.
−Removed: The gain on promoted interest was based off of the returns earned over
−Removed: the duration of the Austin Venture and the returns were determined based on operating results and real estate valuation of the venture.
+Added: The gain on promoted
+Added: interest was based off of the returns earned over the duration of the Austin Venture and the returns were determined based on operating results and real estate valuation of the venture.
The Company previously accounted for its 50 % non-controlling interest in the Austin Venture under the equity method of accounting.
18 unchanged sentences
The acquisition values have been allocated as follows (in thousands):
−Removed: Quarry Lake II
−Removed: Austin Venture Portfolio
−Removed: Four Tower Bridge
+Added: Quarry Lake II Austin Venture Portfolio Four Tower Bridge
Acquisition Date 12/19/2018 12/11/2018 1/5/2018
15 unchanged sentences
Total cash payment at settlement $ 39,037 $ 117,348 $ —
−Removed: Weighted average amortization period of intangible assets
−Removed: Weighted average amortization period of below market liabilities assumed
−Removed: Represents a deferred gain recognized at settlement, which resulted in a reduction of the acquisition value.
−Removed: The outstanding principal balance on mortgage debt for Four Tower Bridge, assumed on January 5, 2018, was $ 9.7 million .
−Removed: On December 11, 2018, the Company assumed $ 115.5 million of mortgage debt which was repaid in full at settlement.
−Removed: Represents a note receivable due from the DRA Austin Venture that represents a purchase price reduction.
+Added: Weighted average amortization period of intangible assets 0 5.5 years 4.1 years
+Added: Weighted average amortization period of below market liabilities assumed 3.0 years 4.6 years 4.8 years
+Added: (a) Represents a deferred gain recognized at settlement, which resulted in a reduction of the acquisition value.
+Added: (b) The outstanding principal balance on mortgage debt for Four Tower Bridge, assumed on January 5, 2018, was $ 9.7 million.
+Added: (c) On December 11, 2018, the Company assumed $ 115.5 million of mortgage debt which was repaid in full at settlement.
+Added: (d) Represents a note receivable due from the DRA Austin Venture that represents a purchase price reduction.
Quarry Lake II contributed approximately $ 0.1 million of revenue and $ 0.1 million of net income, included in the Company’s consolidated statements of operations, for the twelve-month period ended December 31, 2018.
6 unchanged sentences
Pro forma net income available to common shareholders 134,142 115,475
−Removed: 2017 Acquisitions
−Removed: On October 13, 2017, the Company acquired, through a 99 -year prepaid ground lease, the leasehold interest in an office property containing 282,709 rentable square feet located at 3025 Market Street in Philadelphia, Pennsylvania, known as The Bulletin Building, for a gross purchase price of $ 35.0 million .
−Removed: The purchase price and acquisition-related costs have been allocated as follows (in thousands):
−Removed: October 13, 2017
−Removed: Building and improvements
−Removed: Construction-in-progress
−Removed: Intangible assets acquired (a)
−Removed: Below market lease liabilities assumed (b)
−Removed: Weighted average amortization period of 7.9 years .
−Removed: Weighted average amortization period of 7.0 years .
−Removed: The Bulletin Building contributed approximately $ 1.2 million of revenue and approximately $ 0.4 million of net loss in the Company’s consolidated statements of operations, for the period from October 13, 2017 through December 31, 2017.
−Removed: On July 28, 2017, the Company acquired an office building containing 58,587 rentable square feet located at 3000 Market Street, in Philadelphia, Pennsylvania, for $ 32.7 million .
−Removed: The purchase price and acquisition-related costs have been allocated as follows (in thousands):
−Removed: July 28, 2017
−Removed: Building, land and improvements
−Removed: Intangible assets acquired (a)
−Removed: Below market lease liabilities assumed (b)
−Removed: Weighted average amortization period of 5.9 years .
−Removed: Weighted average amortization period of 6.0 years .
−Removed: 3000 Market Street contributed approximately $ 0.8 million of revenue and a $ 0.5 million of net loss in the Company’s consolidated statements of operations, for the period from July 28, 2017 through December 31, 2018.
−Removed: The following table summarizes the properties sold during the years ended December 31, 2019, 2018 and 2017 (dollars in thousands):
−Removed: Property/Portfolio Name
−Removed: Disposition Date
−Removed: Property Type
−Removed: Rentable Square Feet/ Acres
−Removed: Gain/(Loss) on Sale (a)
−Removed: 1900 Gallows Rd
−Removed: September 11, 2019
−Removed: 9 Presidential Boulevard
−Removed: March 15, 2019
−Removed: Bala Cynwyd, PA
−Removed: Subaru National Training Center (b)
−Removed: December 21, 2018
−Removed: Rockpoint Portfolio (c)
−Removed: December 20, 2018
−Removed: 20 East Clementon Road
−Removed: June 21, 2018
−Removed: Gibbsboro, NJ
−Removed: Garza Ranch - Office (d)
−Removed: March 16, 2018
−Removed: Westpark Land
−Removed: January 10, 2018
−Removed: 11, 14, 15, 17 and 18 Campus Boulevard (Newtown Square)
−Removed: November 22, 2017
−Removed: Newtown Square, PA
−Removed: 630 Allendale Road
−Removed: October 31, 2017
−Removed: King of Prussia, PA
−Removed: Swedesford Square
−Removed: September 13, 2017
−Removed: Bishop's Gate
−Removed: July 18, 2017
−Removed: Mount Laurel, NJ
−Removed: Two, Four A, Four B and Five Eves Drive (Evesham Corporate Center) (e)
−Removed: June 27, 2017
−Removed: 7000 Midlantic Drive
−Removed: June 12, 2017
−Removed: Mount Laurel, NJ
−Removed: Garza Ranch - Multi-family (d)
−Removed: April 28, 2017
−Removed: 200, 210 & 220 Lake Drive East (Woodland Falls)
−Removed: March 30, 2017
−Removed: Cherry Hill, NJ
−Removed: Philadelphia Marine Center (Marine Piers) (f)
−Removed: March 15, 2017
−Removed: Philadelphia, PA
−Removed: 11700, 11710, 11720 & 11740 Beltsville Drive (Calverton) (g)
−Removed: March 13, 2017
−Removed: Beltsville, MD
−Removed: Gateway Land - Site C
−Removed: February 15, 2017
−Removed: 1200 & 1220 Concord Avenue (Concord Airport Plaza)
−Removed: February 2, 2017
−Removed: Garza Ranch - Hotel (d)
−Removed: January 30, 2017
−Removed: Gain/(Loss) on Sale is net of closing and other transaction related costs.
−Removed: During the third quarter of 2018, the tenant, Subaru, exercised its purchase option for the Subaru National Training Center Development.
+Added: The following table summarizes the property dispositions during the years ended December 31, 2020, 2019 and 2018 (dollars in thousands):
+Added: Property/Portfolio Name Disposition Date Location Property Type Rentable Square Feet/Acres Sales Price Gain/(Loss) on Sale (a)
+Added: Mid-Atlantic Office Portfolio (b) (g) December 21, 2020 Various Office 1,128,645 $ 192,943 $ 15,164
+Added: One and Two Commerce Square (c) July 21, 2020 Philadelphia, PA Office 1,896,142 $ 115,000 $ 271,905
+Added: Keith Valley June 15, 2020 Horsham, PA Land 14.0 Acres
+Added: $ 4,000 $ 201
+Added: 52 East Swedesford Road March 19, 2020 Malvern, PA Office 131,077 $ 18,000 $ 2,336
+Added: 1900 Gallows Rd September 11, 2019 Vienna, VA Office 210,632 $ 36,400 $ ( 367 )
+Added: 9 Presidential Boulevard March 15, 2019 Bala Cynwyd, PA Land 2.7 Acres
+Added: $ 5,325 $ 751
+Added: Subaru National Training Center (d) December 21, 2018 Camden, NJ Mixed-use 83,000 $ 45,300 $ 2,570
+Added: Rockpoint Portfolio (e) December 20, 2018 Herndon, VA Office 1,293,197 $ 312,000 $ 397
+Added: 20 East Clementon Road June 21, 2018 Gibbsboro, NJ Office 38,260 $ 2,000 $ ( 35 )
+Added: Garza Ranch - Office (f) March 16, 2018 Austin, TX Land 6.6 acres
+Added: $ 14,571 $ 1,515
+Added: Westpark Land January 10, 2018 Durham, NC Land 13.1 acres
+Added: (a) Gain/(Loss) on Sale is net of closing and other transaction related costs.
+Added: (b) The Company sold a 60 % equity interest in a portfolio of twelve suburban office properties containing an aggregate of 1.1 million square feet ("Mid-Atlantic Office Portfolio"), nine of which are located in the Pennsylvania suburbs and three of which are located in Maryland, to an unrelated third party for a gross sales price of $ 192.9 million.
+Added: The transaction resulted in deconsolidation of the properties and formation of PA/MD NNN Office JV, LLC ("Mid-Atlantic Office JV").
+Added: The Company recorded its investment at fair value and recognized a gain of $ 15.2 million in "Net gain on disposition of real estate" on the Consolidated Statements of Operations.
+Added: See Note 4, ''Investment in Unconsolidated Real Estate Ventures," for further information.
+Added: (c) The Company sold a 30 % preferred equity interest in two office buildings located in Philadelphia, Pennsylvania, to an unrelated third party for $ 115.0 million (the "Commerce Square Venture Transaction"), which resulted in deconsolidation of the properties and formation of Brandywine Commerce I LP and Brandywine Commerce II LP (collectively, the "Commerce Square Venture").
+Added: The transaction valued the properties at $ 600.0 million.
+Added: The Company recorded its investment at fair value and recognized a gain of $ 271.9 million in "Net gain on disposition of real estate" on the Consolidated Statements of Operations.
+Added: See Note 4, ''Investment in Unconsolidated Real Estate Ventures," for further information.
+Added: (d) During the third quarter of 2018, the tenant, Subaru, exercised its purchase option for the Subaru National Training Center Development.
The lease with Subaru was classified as a direct finance lease within "Other assets" on the consolidated balance sheets.
In connection with the lease, the Company recognized $ 1.6 million in interest income during the twelve months ended December 31, 2018, in accordance with accounting guidance for direct finance leases under ASC 840.
−Removed: For information related to this transaction, see the “Herndon Innovation Center Metro Portfolio Venture, LLC” section in Note 4, “Investment in Unconsolidated Real Estate Ventures.”
−Removed: The Company had continuing involvement in these properties through a completion guaranty, which required the Company, as developer, to complete certain infrastructure improvements on behalf of the buyers of the land parcels.
+Added: (e) For information related to this transaction, see the “Herndon Innovation Center Metro Portfolio Venture, LLC” section in Note 4, “Investment in Unconsolidated Real Estate Ventures.”
+Added: (f) The Company had continuing involvement in this property through a completion guaranty, which required the Company, as developer, to complete certain infrastructure improvements on behalf of the buyers of the land parcel.
The Company recorded the cash received at settlement as “Deferred income, gains and rent” on the consolidated balance sheet.
−Removed: The Company subsequently recognized the land sales and the $ 3.0 million gain on sale during the twelve months ended December 31, 2018 upon substantial completion of the infrastructure improvements and transfer of control to the buyer.
−Removed: As of March 31, 2017, the Company evaluated the recoverability of the carrying value of its properties that triggered assessment under the undiscounted cash flow model.
−Removed: Based on the Company’s evaluation, it was determined that due to the reduction in the Company’s intended hold period of four properties located in the Other segment, the Company would not recover the carrying values of these properties.
−Removed: Accordingly, the Company recorded impairment charges on these properties of $ 1.0 million at March 31, 2017, which reduced the aggregate carrying values of the properties from $ 10.2 million to their estimated fair value of $ 9.2 million .
−Removed: The Company measured these impairments based on a discounted cash flow analysis, using a hold period of 10 years and residual capitalization rates and discount rates of 9.00 % and 9.25 % , respectively.
−Removed: The results were comparable to indicative pricing in the market.
−Removed: The assumptions used to determine fair value under the income approach are Level 3 inputs in accordance with the fair value hierarchy.
−Removed: The loss on sale in the table above represents additional closing costs.
−Removed: On the closing date, the buyer paid $ 12.0 million in cash and the Company received cash proceeds of $ 11.2 million , after closing costs and prorations.
−Removed: The $ 9.4 million balance of the purchase price was due on (a) January 31, 2020 , in the event that the tenant at the Marine Piers does not exercise an option it holds to extend the term of the sublease or (b) January 15, 2024, in the event that the tenant does exercise the option to extend the term of the sublease.
−Removed: The Company determined that it was appropriate to recognize the sale of the sublease interest in the Marine Piers and to defer the remaining $ 9.4 million balance due under the purchase and sale agreement until collectability can be determined.
−Removed: During the first quarter of 2019, the tenant at the Marine Piers exercised its option to extend the term of its sublease.
−Removed: As a result, the $ 9.4 million balance of the purchase price is due on January 15, 2024, and the Company will recognize the additional gain on sale when the gain is realized or realizable.
−Removed: During the twelve months ended 2017, there was a price reduction of $ 1.7 million under the agreement of sale and additional impairment of $ 1.7 million was recognized.
+Added: The Company subsequently recognized the land sale and the $ 3.0 million gain on sale during the twelve months ended December 31, 2018 upon substantial completion of the infrastructure improvements and transfer of control to the buyer.
+Added: (g) The sales price includes $ 4.1 million of variable consideration held in escrow that will be released to the Company over a six to nine month holdback period if certain tenants remain in compliance with certain payment terms of their lease agreements.
+Added: The Company estimated the amount of the variable consideration that it deemed probable of collection and included such amount in the transaction price.
+Added: The Company will continue to evaluate the probability of collection and recognize any changes to the amount deemed probable as incremental gain on sale.
During the year ended December 31, 2019, the Company also recorded a $ 1.0 million gain related to contingent consideration received related to a land sale that closed in a prior period in the Other segment.
−Removed: We also received additional proceeds from a sale that closed in a prior year related to a property in the Metropolitan Washington D.C.
+Added: The Company also received additional proceeds from a sale that closed in a prior year related to a property in the Metropolitan Washington, D.C.
segment resulting in $ 0.7 million of additional gain on sale.
Held for Use Impairment
−Removed: As of December 31, 2019, the Company evaluated the recoverability of the carrying value of its properties that triggered assessment.
−Removed: Based on the analysis, no impairments were identified during the twelve months ended December 31, 2019.
+Added: As of December 31, 2020 and 2019, the Company evaluated the recoverability of the carrying value of its properties that triggered assessment.
+Added: Based on the analysis, no impairments were identified during the twelve months ended December 31, 2020 and 2019.
As of December 31, 2018, the Company evaluated the recoverability of the carrying values of certain properties that triggered an assessment under the undiscounted cash flow model.
−Removed: Based on its evaluation, the Company determined it would not recover the carrying value of one property in its Other segment, 1900 Gallows Road, located in Vienna, Virginia, due to a reduction in the intended hold period.
+Added: Based on its evaluation, the Company determined it would not
+Added: recover the carrying value of one property in its Other segment, 1900 Gallows Road, located in Vienna, Virginia, due to a reduction in the intended hold period.
Accordingly, the Company recorded an impairment of $ 14.8 million at December 31, 2018, reflected in the results for the twelve months ended December 31, 2018, which reduced the carrying value of the property from $ 52.8 million to its estimated fair value of $ 38.0 million.
2 unchanged sentences
Held for Sale
−Removed: As of December 31, 2019, the Company determined that the sale of two parcels of land within the Other segment totaling 35.2 acres was probable and classified these properties as held for sale.
−Removed: As such, $ 7.3 million was classified as “Assets held for sale, net” on the consolidated balance sheets.
−Removed: As of December 31, 2018, the Company determined that the sale of three parcels of land (two within the Other segment and one with Pennsylvania Suburbs segment) totaling 37.9 acres was probable and classified these properties as held for sale.
−Removed: As such, $ 11.6 million was classified as “Assets held for sale, net” on the consolidated balance sheets.
+Added: As of both December 31, 2020 and 2019, the Company determined that the sale of two parcels of land within the Other segment totaling 35.2 acres was probable and classified these properties as held for sale.
+Added: As such, $ 7.3 million was classified as “Assets held for sale, net” on the consolidated balance sheets as of December 31, 2020 and 2019.
As of December 31, 2020 and 2019, the fair value less the anticipated costs of sale of the properties exceeded the carrying values.
8 unchanged sentences
INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES
−Removed: As of December 31, 2019 , the Company held ownership interests in seven unconsolidated real estate ventures for an aggregate investment balance of $ 120.3 million .
+Added: As of December 31, 2020, the Company held ownership interests in nine unconsolidated real estate ventures for an aggregate investment balance of $ 389.8 million, which includes a negative investment balance in one unconsolidated real estate venture of $ 11.5 million, reflected within 'Other liabilities' on the consolidated balance sheets.
The Company formed or acquired interests in the Real Estate Ventures with unaffiliated third parties to develop or manage office, residential and/or mixed-use properties or to acquire land in anticipation of possible development of office, residential and/or mixed-use properties.
−Removed: As of December 31, 2019 , three of the real estate ventures owned properties that contained an aggregate of approximately 5.4 million net rentable square feet of office space;
+Added: As of December 31, 2020, five of the real estate ventures owned properties that contained an aggregate of approximately 8.4 million net rentable square feet of office space;
two real estate ventures owned 1.4 acres of land held for development;
3 unchanged sentences
Certain of the Real Estate Ventures are subject to specified priority allocations of distributable cash.
−Removed: The Company earned management fees from its Real Estate Ventures of $ 4.3 million , $ 6.3 million and $ 6.4 million for the years ended December 31, 2019 , 2018 and 2017 , respectively.
+Added: The Company earned management fees from the Real Estate Ventures of $ 4.7 million, $ 4.3 million and $ 6.3 million for the years ended December 31, 2020, 2019 and 2018, respectively.
The Company earned leasing commission income from the Real Estate Ventures of $ 1.1 million, $ 1.7 million and $ 2.5 million for the years ended December 31, 2020, 2019 and 2018, respectively.
−Removed: The Company has outstanding accounts receivable balances from its Real Estate Ventures of $ 0.8 million for both the years ended December 31, 2019 and 2018 .
+Added: The Company has outstanding accounts receivable balances from the Real Estate Ventures of $ 1.2 million and $ 0.8 million as of December 31, 2020 and 2019, respectively.
The amounts reflected in the following tables (except for the Company’s share of equity in income) are based on the historical financial information of the individual real estate ventures.
−Removed: The Company does not record operating losses of a real estate venture in excess of its investment balance unless the Company is liable for the obligations of the real estate venture or is otherwise committed to provide financial support to the real estate venture.
−Removed: The Company’s investment in Real Estate Ventures as of December 31, 2019 and 2018 , and the Company’s share of the Real Estate Ventures’ income (loss) for the years ended December 31, 2019 and 2018 was as follows (in thousands):
−Removed: Ownership Percentage (a)
−Removed: Carrying Amount
−Removed: Company's Share of Real Estate Venture Income (Loss)
−Removed: Real Estate Venture Debt at 100%, gross
+Added: The Company records operating losses of a real estate venture in excess of its investment balance if the Company is liable for the obligations of the real estate venture or is otherwise committed to provide financial support to the real estate venture.
+Added: The Company’s investment in the Real Estate Ventures as of December 31, 2020 and 2019, and the Company’s share of the Real Estate Ventures’ income (loss) for the years ended December 31, 2020 and 2019 was as follows (in thousands):
+Added: Ownership Percentage Carrying Amount Company's Share of Real Estate Venture Income (Loss) Real Estate Venture Debt at 100%, gross
+Added: 2020 2019 2020 2019 2020 2019
Office Properties
+Added: Commerce Square Venture 70 % (a)
+Added: $ 253,128 $ — $ ( 9,150 ) $ — $ 219,168 $ —
+Added: Mid-Atlantic Office Venture 40 % (a)
+Added: 32,996 — 96 — 120,831 —
Brandywine - AI Venture LLC 50 % 10,302 10,116 185 ( 2,800 ) — —
Herndon Innovation Center Metro Portfolio Venture, LLC 15 % 16,019 16,446 ( 358 ) ( 498 ) 207,302 207,302
−Removed: Austin Venture
−Removed: evo at Cira Centre South Venture
+Added: MAP Venture 50 % ( 11,516 ) ( 70 ) ( 6,570 ) ( 6,102 ) 185,000 185,000
+Added: PJP VII 25 % (b)
+Added: — — — 190 — —
+Added: PJP II 30 % (b)
+Added: PJP VI 25 % (b)
+Added: — — — ( 185 ) — —
+Added: 1919 Venture 50 % 15,434 17,524 59 328 88,860 88,860
Development Properties
−Removed: 4040 Wilson Venture (d)
−Removed: JBG - 51 N Street (d)
−Removed: JBG - 1250 First Street Office (d)
−Removed: Ownership percentage represents the Company’s entitlement to residual distributions after payments of priority returns, where applicable.
−Removed: On October 29, 2019.
−Removed: The Company sold its interest in PJP II, PJP VI and PJP VII.
+Added: 4040 Wilson Venture (c) 50 % 34,454 37,002 ( 2,162 ) ( 368 ) 141,857 114,845
+Added: JBG - 51 N Street (c) 70 % 21,237 21,531 ( 457 ) ( 313 ) — —
+Added: JBG - 1250 First Street Office (c) 70 % 17,757 17,745 ( 227 ) ( 255 ) — —
+Added: $ 389,811 $ 120,294 $ ( 18,584 ) $ ( 9,922 ) $ 963,018 $ 596,007
+Added: (a) Ownership percentage represents the Company’s combined interest including preferred and common equity holdings.
+Added: See "Commerce Square Venture" and "Mid-Atlantic Office JV" sections below for more information.
+Added: (b) On October 29, 2019, the Company sold its interest in PJP II, PJP VI and PJP VII.
See "PJP Ventures" section below for more information on the disposal.
−Removed: The Company’s purchased its partner’s entire 50 % interest in this venture on December 11, 2018.
−Removed: Refer to the "Austin Venture" section below for more information.
−Removed: This entity is a VIE.
+Added: (c) This entity is a VIE.
The following is a summary of the financial position of the Real Estate Ventures as of December 31, 2020 and December 31, 2019 (in thousands):
−Removed: December 31, 2019
−Removed: Brandywine-AI Venture LLC
−Removed: Other assets (a)
−Removed: Other liabilities (a)
−Removed: Debt, net (b)
−Removed: December 31, 2018
−Removed: Brandywine-AI Venture LLC
−Removed: Other assets (a)
−Removed: Other liabilities (a)
−Removed: Debt, net (b)
−Removed: The increase is primarily due to the recording of lease related assets and liabilities of $ 197.1 million and $ 206.4 million , respectively, for MAP Venture in connection with the adoption of Topic 842.
−Removed: The increase is primarily due to third-party debt financing received by Herndon Innovation Center Venture during 2019.
−Removed: See “Herndon Innovation Center Metro Portfolio Venture” section below for further information.
−Removed: This amount does not include the effect of the basis difference between the Company's historical cost basis and the basis recorded at the Real Estate Venture level, which is typically amortized over the life of the related assets and liabilities.
−Removed: Basis differentials occur from the impairment of investments, purchases of third party interests in existing Real Estate Ventures, and upon the transfer of assets that were previously owned by the Company into a Real Estate Venture.
+Added: December 31, 2020 December 31, 2019
+Added: Net property $ 1,520,804 $ 834,367
+Added: Other assets 488,805 342,002
+Added: Other liabilities 333,049 290,071
+Added: Debt, net 956,688 585,068
+Added: Equity (a) 719,872 301,230
+Added: (a) This amount does not include the effect of the basis difference between the Company's historical cost basis and the basis recorded at the real estate venture level, which is typically amortized over the life of the related assets and liabilities.
+Added: Basis differentials occur from the impairment of investments, purchases of third party interests in existing real estate ventures and upon the transfer of assets that were previously owned by the
+Added: Company into a real estate venture.
In addition, certain acquisition, transaction and other costs may not be reflected in the net assets at the real estate venture level.
1 unchanged sentence
Year Ended December 31,
−Removed: Brandywine-AI Venture LLC
−Removed: Operating expenses
−Removed: Provision for impairment
−Removed: Interest expense, net
−Removed: Depreciation and amortization
−Removed: Loss on extinguishment of debt
−Removed: Ownership interest %
−Removed: Company's share of net loss
−Removed: Basis adjustments and other
−Removed: Equity in loss of Real Estate Ventures
−Removed: Year Ended December 31, 2018
−Removed: Austin Venture
−Removed: Brandywine-AI Venture LLC
−Removed: evo at Cira Centre South
+Added: 2020 2019 2018
+Added: Revenue $ 150,276 $ 132,358 $ 165,326
Operating expenses ( 85,812 ) ( 71,784 ) ( 82,035 )
3 unchanged sentences
Loss on extinguishment of debt — ( 1,231 ) ( 1,385 )
−Removed: Net income (loss)
−Removed: Ownership interest %
−Removed: Company's share of net income (loss)
−Removed: Other than temporary impairment
−Removed: Basis adjustments and other
−Removed: Equity in income (loss) of Real Estate Ventures
−Removed: Year Ended December 31, 2017
−Removed: Austin Venture
−Removed: Brandywine-AI Venture LLC
−Removed: evo at Cira Centre South
−Removed: Operating expenses
−Removed: Interest expense, net
−Removed: Depreciation and amortization
−Removed: Loss on extinguishment of debt
−Removed: Net income (loss)
−Removed: Ownership interest %
−Removed: Company's share of net income (loss)
+Added: Net loss $ ( 29,002 ) $ ( 21,560 ) $ ( 22,526 )
+Added: Ownership interest % Various Various Various
+Added: Company's share of net loss $ ( 18,540 ) $ ( 9,865 ) $ ( 11,924 )
Other-than-temporary impairment — — ( 4,076 )
Basis adjustments and other ( 44 ) ( 57 ) 769
−Removed: Equity in income (loss) of Real Estate Ventures
−Removed: As of December 31, 2019 , the aggregate principal payments of recourse and non-recourse debt payable to third-parties are as follows (in thousands):
+Added: Equity in loss of Real Estate Ventures $ ( 18,584 ) $ ( 9,922 ) $ ( 15,231 )
+Added: As of December 31, 2020, the aggregate principal payments of the Real Estate Ventures recourse and non-recourse debt payable to third-parties are as follows (in thousands):
+Added: 2021 $ 148,693
Total principal payments 963,018
Net deferred financing costs ( 8,224 )
+Added: Net original issue premium 1,894
Outstanding indebtedness $ 956,688
−Removed: On October 29, 2019, PJP II, PJP VII and PJP VI, three real estate ventures in which the Company owned a 25 % - 30 % interest, each sold their sole operating office property, totaling 204,347 rentable square feet in Charlottesville, VA, at an aggregate sales price of $ 51.0 million .
+Added: Mid-Atlantic Office JV
+Added: On December 21, 2020, the Company contributed a portfolio of twelve properties containing an aggregate of 1,128,645 square feet, nine of which are located in the Pennsylvania suburbs segment and three located in the Metropolitan Washington, D.C segment, to the Mid-Atlantic Office JV, for a gross sales price of $ 192.9 million.
+Added: After the transaction, the Company owns approximately 25 % of the equity interest in the Mid-Atlantic Office JV through a $ 20.0 million preferred equity holding and approximately 15 % of the equity interest through a common equity interest (representing 20 % of the total common equity), for a combined approximately 40 % equity interest in the venture.
+Added: On the closing date, Mid-Atlantic Office JV also obtained $ 147.4 million of third-party debt financing secured by the twelve properties within the venture, with an initial advance of $ 120.8 million.
+Added: The loan bears interest at LIBOR + 3.15 % capped at a total maximum interest rate of 5.6 % and matures on January 9, 2024.
+Added: Based on the facts and circumstances at the formation of the Mid-Atlantic Office JV, the Company determined that the venture is not a VIE in accordance with the accounting standard for the consolidation of VIEs.
+Added: As a result, the Company used the voting interest model under the accounting standard for consolidation in order to determine whether to consolidate the Mid-Atlantic Office JV.
+Added: Based upon each member's substantive participating rights over the activities of the Mid-Atlantic Office JV under the operating and related agreements of the Mid-Atlantic Office JV, it is not consolidated by the Company, and is accounted for under the equity method of accounting.
+Added: As a result, the Company measured its equity interest at fair value based on the fair value of the Mid-Atlantic Office JV properties and the distribution provisions of the real estate venture
+Added: Since the Company retains a non-controlling interest in the Mid-Atlantic Office JV and there are no other facts and circumstances that preclude the consummation of a sale, the contribution qualifies as a sale of a nonfinancial asset under the relevant guidance.
+Added: Commerce Square Venture
+Added: On July 21, 2020, the Company sold a 30 % preferred equity interest in the entities that own One Commerce Square and Two Commerce Square.
+Added: After the transaction, the Company owns approximately 32 % of the equity interest in Commerce Square Venture through preferred equity interest holdings and approximately 38 % of the equity interest in Commerce Square Venture as the sole common equity holder, for a combined approximately 70 % equity interest in the venture.
+Added: The properties held by the venture remain encumbered by the existing mortgages, which had a $ 222.1 million principal balance outstanding on the transaction date.
+Added: Based on the facts and circumstances at the formation of the Commerce Square Venture, the Company determined that the venture is not a VIE.
+Added: As a result, the Company used the voting interest model under the accounting standard for consolidation in order to determine whether to consolidate the Commerce Square Venture.
+Added: Based upon each member's substantive participating rights over the activities of the Commerce Square Venture under the operating and related agreements of the Commerce Square Venture, the Company does not have a controlling interest in the properties as the third party investor holds substantive participating rights in the properties.
+Added: Therefore, the Company deconsolidated the properties and the venture is accounted for under the equity method of accounting.
+Added: As a result, the Company measured its equity interest at fair value based on the fair value of the Commerce Square Venture properties and the distribution provisions of the real estate venture agreement.
+Added: Since the Company retains a non-controlling interest in the Commerce Square Venture and there are no other facts and circumstances that preclude sale recognition, the contribution qualifies as the sale of a nonfinancial asset under the relevant guidance.
+Added: Under the conventional approach of accounting for equity method investments, an investor applies its percentage ownership interest to the venture’s net income or loss to determine the investor’s share of the earnings or losses of the venture.
+Added: This approach is inappropriate if the venture’s capital structure gives different rights and priorities to its investors.
+Added: Therefore, the Company follows the hypothetical liquidation at book value (“HLBV”) method in determining its share of the Commerce Square Venture’s earnings or losses for the reporting period as this method better reflects the Company’s claim on the venture’s book value at the end of each reporting period.
+Added: Earnings for this equity method investment are recognized in accordance with the real estate venture agreement and, where applicable, based upon the allocation of the investment’s net assets at book value as if the investment was hypothetically liquidated at the end of each reporting period.
+Added: On October 29, 2019, PJP II, PJP VII and PJP VI, three real estate ventures in which the Company owned a 25 %- 30 % interest, each sold its sole operating office property, totaling 204,347 rentable square feet in Charlottesville, Virginia, at an aggregate sales price of $ 51.0 million.
The Company received cash proceeds of $ 9.1 million after closing costs and related debt payoffs.
24 unchanged sentences
Since the Company retained a noncontrolling interest in the Austin Properties and there were no other facts and circumstances that precluded the consummation of a sale, the contribution qualified as a partial sale of real estate under the relevant guidance for sales of real estate.
−Removed: On October 18, 2017, the Austin Venture sold eight office properties in Austin, Texas containing 1,164,496 square feet for a gross sales price of $ 333.3 million .
−Removed: Seven of the properties were encumbered by $ 151.0 million of mortgage debt.
−Removed: The Company’s share of cash proceeds, after payment of the of the mortgage debt, closing costs and prorations, was $ 86.4 million .
−Removed: The Company’s share of the Austin Venture’s gain on sale was $ 40.1 million .
−Removed: Additionally, the Company recorded a deferred gain on sale of $ 12.1 million , which was established on the Company’s consolidated balance sheets when certain assets were contributed to the Austin Venture at formation.
−Removed: In accordance with the relevant guidance for the sales of real estate, the contributed properties qualified as a partial sale and a portion of the gain was deferred and accreted.
−Removed: The Company met the criteria to recognize the unaccreted portion of the deferred gain on the partial sale as the sales process was complete upon the Austin Venture selling the properties to a third party.
−Removed: The summary of the transaction is as follows (in thousands);
−Removed: October 18, 2017
−Removed: Gross sales price
−Removed: Debt principal
−Removed: Debt prepayment penalties
−Removed: Closing costs and net prorations
−Removed: Cash to Austin Venture
−Removed: Company's ownership interest
−Removed: Cash to the Company
−Removed: Cash to Austin Venture
−Removed: Austin Venture basis of sold properties
−Removed: Austin Venture gain on sale
−Removed: Company's ownership interest
−Removed: Company's share of gain
−Removed: Company's share of gain
−Removed: Deferred gain from partial sale
−Removed: Gain on real estate venture transactions
On December 11, 2018, the Company acquired DRA’s 50 % ownership interest in the Austin Venture for an aggregate purchase price of $ 535.1 million.
15 unchanged sentences
Based on the Company’s evaluation of the fair value of its investment in BDN - AI Venture subsequent to the disposition of Station Square, the Company determined that a persistent weak demand for office space and intense competition for tenants at the two remaining properties had reduced the fair value of the investment below the carrying value.
−Removed: As a result, the Company recorded an other than temporary impairment of $ 4.1 million which was recognized in “Equity in Loss of Real Estate Ventures” in the consolidated statements of operations for the year ended December 31, 2018.
−Removed: The Company measured this impairment based on a discounted cash flow analysis, using a hold period of 10 years , a residual capitalization rate of 8.0 % and discount rates ranging from 9.0 % to 9.5 % .
−Removed: During 2017, BDN - AI Venture sold 7101 Wisconsin Avenue, a property containing 230,904 rentable square feet located in Bethesda, Maryland, for a gross sales price of $ 105.7 million .
−Removed: At the time of sale, the property was encumbered by a mortgage of $ 37.4 million , which was repaid in full at closing, resulting in a debt prepayment penalty of $ 0.8 million .
−Removed: After mortgage payoff and closing costs, BDN - AI Venture received cash proceeds of $ 63.6 million , of which, the Company received $ 31.8 million and recognized a $ 13.8 million gain on the sale transaction.
−Removed: Additionally, in 2017, based on the Company’s evaluation of the fair value of its investment in the five remaining properties owned by BDN - AI Venture subsequent to the disposition of 7101 Wisconsin Avenue, the Company determined that a persistent weak demand office for space and intense competition for tenants had reduced the fair value of the investment below the carrying value.
−Removed: As a result, the Company recorded an other than temporary impairment of $ 4.8 million which was recognized in “Equity in Loss of Real Estate Ventures” in the consolidated statements of operations for the year ended December 31, 2017.
+Added: As a result, the Company recorded an other than temporary impairment
+Added: of $ 4.1 million which was recognized in “Equity in Loss of Real Estate Ventures” in the consolidated statements of operations for the year ended December 31, 2018.
The Company measured this impairment based on a discounted cash flow analysis, using a hold period of 10 years, a residual capitalization rate of 8.0 % and discount rates ranging from 9.0 % to 9.5 %.
10 unchanged sentences
The Company recorded its $ 4.6 million proportionate share of the cumulative effect of accounting change adjustment through "Cumulative earnings” on its consolidated balance sheets.
−Removed: On August 1, 2018, MAP Venture refinanced its $ 180.8 million third party debt financing, secured by the buildings of MAP Venture and maturing February 9, 2019 , with $ 185.0 million third party debt financing, also secured by the buildings, bearing interest at LIBOR + 2.45 % capped at a total maximum interest of 6.00 % and maturing on August 1, 2023 .
−Removed: 1919 Ventures
−Removed: 1919 Ventures owns a 29 -story, 455,000 square foot mixed-use tower consisting of 321 luxury apartments, 24,000 square feet of commercial space and a 215 -car structured parking facility.
−Removed: During 2018, the Company and the other equity partner in 1919 ventures each provided a $ 44.4 million mortgage loan to 1919 Ventures and, as a result, the Company recorded a related-party note receivable from 1919 Ventures of $ 44.4 million which is reported within “Other assets” on the consolidated balance sheets.
−Removed: The loans bear interest at a fixed 4.0 % per annum interest rate with a scheduled maturity on June 25, 2023 .
−Removed: 1919 Ventures used the loan to repay the venture’s then outstanding $ 88.8 million construction loan, comprised of $ 88.6 million in principal and $ 0.2 million of accrued interest.
+Added: On August 1, 2018, MAP Venture refinanced its $ 180.8 million third party debt financing, secured by the buildings of MAP Venture and maturing February 9, 2019, with $ 185.0 million third party debt financing, also secured by the buildings, bearing interest at LIBOR + 2.45 % and maturing on August 1, 2023.
+Added: The interest rate is swapped to a fixed rate of 2.66% through the maturity date.
+Added: 1919 Venture owns a 29 -story, 455,000 square foot mixed-use tower consisting of 321 luxury apartments, 24,000 square feet of commercial space and a 215 -car structured parking facility.
+Added: See to Note 5, "Investment in Unconsolidated Real Estate Ventures" for additional information regarding the related-party note receivable with 1919 Venture.
Four Tower Bridge Acquisition
9 unchanged sentences
As the Company’s investment basis was $ 17.3 million, a gain of $ 25.7 million was recorded within the “Net gain on real estate venture transactions’ caption in the consolidated statements of operations.
−Removed: The Parc at Plymouth Meeting Venture
−Removed: On January 31, 2017, the Company sold its 50 % interest in TB-BDN Plymouth Apartments, L.P., a real estate venture with Toll Brothers, at a gross sales value of $ 100.5 million , of which the Company was allocated 50 % for its interest.
−Removed: The venture developed and operated a 398 -unit multi-family complex in Plymouth Meeting, Pennsylvania encumbered by a $ 54.0 million construction loan.
−Removed: The construction loan was repaid commensurate with the sale of the Company’s 50 % interest.
−Removed: As a result, the Company is no longer subject to a $ 3.2 million payment guarantee on the construction loan.
−Removed: The cash proceeds, after the payment of the Company’s share of the debt and closing costs, were $ 27.2 million .
−Removed: The carrying amount of the Company’s investment at the time of sale was $ 12.6 million , resulting in a $ 14.6 million gain on sale of an interest in the real estate venture which was recorded within “Net gain on real estate venture transactions" in the consolidated statements of operations.
−Removed: JBG Ventures consists of 51 N 50 Patterson, Holdings, LLC Venture ("51 N Street") and 1250 First Street Office, LLC Venture ("1250 First Street"), with the Company owning a 70.0 % interest and JBG/DC Manager, LLC ("JBG") owning a 30.0 % interest in each of the two ventures.
+Added: JBG Ventures consists of 51 N 50 Patterson, Holdings, LLC Venture ("51 N Street") and 1250 First Street Office, LLC Venture ("1250 First Street"), with the Company owning a 70.0 % equity interest and JBG/DC Manager, LLC ("JBG") owning a 30.0 % equity interest in each of the two ventures.
51 N Street owns 0.9 acres of undeveloped land and 1250 First Street, owns 0.5 acres of undeveloped land.
14 unchanged sentences
Based upon each member’s shared power over the activities of 4040 Wilson under the operating and related agreements, and the Company’s lack of control over the development and construction phases of the project, 4040 Wilson is accounted for under the equity method of accounting.
+Added: DEBT AND PREFERRED EQUITY INVESTMENTS
+Added: As of December 31, 2020, the Company held one debt investment and one preferred equity investment in entities owning real estate assets.
+Added: The Company accounts for these mandatorily redeemable investments as notes receivable, which are included within “Other assets” on the consolidated balance sheets.
+Added: As of December 31, 2020, all debt and preferred equity investments were performing in accordance with their respective terms and remain on accrual status.
+Added: Austin Preferred Equity Investment
+Added: On December 31, 2020, the Company invested $ 50.0 million through a preferred equity interest in a single-purpose entity that owns two stabilized office buildings located in Austin, Texas.
+Added: The preferred equity interest acquired by the Company accrues a 9.0 % annual return, compounded and paid monthly.
+Added: The investment is required to be redeemed no later than December 31, 2023 (subject to a one-year extension option).
+Added: 1919 Venture Note Receivable
+Added: During 2018, the Company and the other equity partner in 1919 Venture each provided a $ 44.4 million mortgage loan to 1919 Venture and, as a result, the Company recorded a related-party note receivable from 1919 Venture of $ 44.4 million.
+Added: The loan bears interest at a fixed 4.0 % per annum interest rate with a scheduled maturity on June 25, 2023.
+Added: 1919 Venture used the proceeds from the loans to repay the venture’s then outstanding $ 88.8 million construction loan.
+Added: See Note 4, ''Investment in Unconsolidated Real Estate Ventures” for further information regarding 1919 Venture.
Lessor Accounting
The Company leases properties to tenants under operating leases with various expiration dates.
−Removed: Lease payments on noncancellable leases at December 31, 2019 are as follows (in thousands):
−Removed: Lease payments on noncancellable leases at December 31, 2018, which were determined under under ASC 840 and are therefore not adjusted for increases based on CPI, are as follows (in thousands):
+Added: Scheduled minimum lease payments on noncancellable leases at December 31, 2020 are as follows (in thousands):
+Added: Year Minimum Rent
+Added: 2021 $ 325,703
+Added: Thereafter 968,163
Lessee Accounting
−Removed: As of December 31, 2019, the Company is the lessee under six long-term ground leases classified as operating leases.
+Added: As of December 31, 2020, the Company is the lessee under six long-term ground leases classified as "operating leases" in the consolidated balance sheets.
Certain of the Company’s ground leases contain extension options and the Company considered all relevant factors in determining if it was reasonably certain that it would exercise such extension options.
1 unchanged sentence
With the exception of certain ground leases that are subject to rent increases periodically based on the CPI index, all lease payments under the ground lease are fixed.
−Removed: The table below summarizes the Company’s operating lease cost (in thousands) recognized through “Property operating expenses” on the consolidated statements of operations:
−Removed: Twelve Months Ended December 31,
+Added: The table below summarizes the Company’s operating lease cost (in thousands) recognized through “Property operating expenses” on the consolidated statements of operations (in thousands):
+Added: Year Ended December 31,
+Added: Lease Cost 2020 2019
Fixed lease cost $ 2,100 $ 2,100
Variable lease cost 45 54
+Added: Total $ 2,145 $ 2,154
Weighted-average remaining lease term (years) 55.9 56.6
3 unchanged sentences
Lease payments on noncancellable leases at December 31, 2020 are as follows (in thousands):
+Added: Year Minimum Rent
+Added: Thereafter 109,131
Total lease payments $ 115,500
3 unchanged sentences
Such amounts, if any, will be reflected as contingent rent when incurred.
−Removed: The leases also provide for payment by the Company of certain operating costs relating to the land, primarily real estate taxes.
+Added: The ground leases also provide for payment by the Company of certain operating costs relating to the land, primarily real estate
The above schedule of future minimum rental payments does not include any contingent rent amounts or any reimbursed expenses.
−Removed: Lease payments on noncancellable leases at December 31, 2018, which were determined under ASC 840 and are therefore not adjusted for increases based on CPI, are as follows (in thousands):
DEFERRED COSTS
1 unchanged sentence
December 31, 2020
−Removed: Accumulated Amortization
−Removed: Deferred Costs, net
+Added: Total Cost Accumulated Amortization Deferred Costs, net
Leasing costs $ 139,207 $ ( 55,656 ) $ 83,551
Financing costs - Revolving Credit Facility 6,299 ( 4,994 ) 1,305
+Added: Total $ 145,506 $ ( 60,650 ) $ 84,856
December 31, 2019
−Removed: Accumulated Amortization
−Removed: Deferred Costs, net
+Added: Total Cost Accumulated Amortization Deferred Costs, net
Leasing costs $ 156,619 $ ( 63,257 ) $ 93,362
Financing costs - Revolving Credit Facility 6,299 ( 4,101 ) 2,198
+Added: Total $ 162,918 $ ( 67,358 ) $ 95,560
During the years ended December 31, 2020, 2019 and 2018, the Company capitalized internal direct leasing costs of $ 1.6 million, $ 1.7 million, and $ 3.9 million, respectively.
2 unchanged sentences
December 31, 2020
−Removed: Accumulated Amortization
−Removed: Intangible Assets, net
+Added: Total Cost Accumulated Amortization Intangible Assets, net
Intangible assets, net:
3 unchanged sentences
Total intangible assets, net $ 94,173 $ ( 45,603 ) $ 48,570
−Removed: Accumulated Amortization
−Removed: Intangible Liabilities, net
+Added: Total Cost Accumulated Amortization Intangible Liabilities, net
Intangible liabilities, net:
1 unchanged sentence
December 31, 2019
−Removed: Accumulated Amortization
−Removed: Intangible Assets, net
+Added: Total Cost Accumulated Amortization Intangible Assets, net
Intangible assets, net:
3 unchanged sentences
Total intangible assets, net $ 177,581 $ ( 92,730 ) $ 84,851
−Removed: Accumulated Amortization
−Removed: Intangible Liabilities, net
+Added: Total Cost Accumulated Amortization Intangible Liabilities, net
Intangible liabilities, net:
1 unchanged sentence
For the years ended December 31, 2020, 2019, and 2018, the Company accelerated the amortization of intangible assets by approximately $ 0.3 million, $ 4.5 million, and $ 0.6 million, respectively, as a result of tenant move-outs prior to the end of the associated lease term.
−Removed: For the year ended December 31, 2019 the Company accelerated the amortization of approximately $ 2.2 million of intangible liabilities as a result of tenant move-outs.
−Removed: For the years ended December 31, 2018 and 2017 the Company accelerated the amortization of a nominal amount of intangible liabilities as a result of tenant move-outs.
+Added: For the years ended December 31, 2020 and 2019 the Company accelerated the amortization of approximately $ 0.1 million and $ 2.2 million of intangible liabilities as a result of tenant move-outs.
+Added: For the year ended December 31, 2018 the Company accelerated the amortization of a no minal amount of intangible liabilities as a result of tenant move-outs.
As of December 31, 2020, the Company’s annual amortization for its intangible assets/liabilities, assuming no early lease terminations, are as follows (dollars in thousands):
+Added: Assets Liabilities
+Added: 2021 $ 16,190 $ 4,902
+Added: 2022 10,354 2,723
+Added: 2023 7,564 1,651
+Added: 2024 5,214 1,425
+Added: 2025 4,027 1,148
+Added: Thereafter 5,221 6,599
+Added: Total $ 48,570 $ 18,448
DEBT OBLIGATIONS
The following table sets forth information regarding the Company’s consolidated debt obligations outstanding at December 31, 2020 and 2019 (in thousands):
−Removed: December 31, 2019
−Removed: December 31, 2018
−Removed: Interest Rate
+Added: December 31, 2020 December 31, 2019 Effective
+Added: Interest Rate Maturity
MORTGAGE DEBT:
−Removed: Two Logan Square
−Removed: Four Tower Bridge
−Removed: February 2021
−Removed: One Commerce Square
−Removed: Two Commerce Square
+Added: Two Logan Square (a) $ — $ 81,103 3.98 % October 2020
+Added: Four Tower Bridge (b) — 9,291 4.50 % February 2021
+Added: One Commerce Square (c) — 116,571 3.64 % April 2023
+Added: Two Commerce Square (c) — 108,472 4.51 % April 2023
Principal balance outstanding — 315,437
6 unchanged sentences
Seven -Year Term Loan - Swapped to fixed
+Added: 250,000 250,000 2.87 % October 2022
$ 350.0 M 3.95 % Guaranteed Notes due 2023
1 unchanged sentence
$ 350.0 M 4.10 % Guaranteed Notes due 2024
+Added: 350,000 350,000 3.78 % October 2024
$ 450.0 M 3.95 % Guaranteed Notes due 2027
1 unchanged sentence
$ 350.0 M 4.55 % Guaranteed Notes due 2029
−Removed: Indenture IA (Preferred Trust I)
−Removed: LIBOR + 1.25%
−Removed: Indenture IB (Preferred Trust I) - Swapped to fixed
−Removed: Indenture II (Preferred Trust II)
−Removed: LIBOR + 1.25%
+Added: 350,000 350,000 4.30 % October 2029
+Added: Indenture IA (Preferred Trust I) 27,062 27,062 LIBOR + 1.25 %
+Added: Indenture IB (Preferred Trust I) - Swapped to fixed 25,774 25,774 3.30 % April 2035
+Added: Indenture II (Preferred Trust II) 25,774 25,774 LIBOR + 1.25 %
Principal balance outstanding 1,828,610 1,828,610
3 unchanged sentences
Total Debt Obligations $ 1,830,595 $ 2,144,418
−Removed: Assumed upon acquisition of the related property on January 5, 2018.
−Removed: The interest rate reflects the market rate at the time of acquisition.
+Added: (a) On October 21, 2020, the Company acquired the $ 79.8 million remaining mortgage on this property from the lender.
+Added: (b) On November 10, 2020, the Company repaid the remaining $ 9.1 million mortgage balance.
+Added: (c) The properties encumbered by these mortgages were deconsolidated as a result of the Commerce Square Venture Transaction.
+Added: See Note 3, ''Real Estate Investments," for further information.
The Parent Company unconditionally guarantees the unsecured debt obligations of the Operating Partnership (or is a co-borrower with the Operating Partnership) but does not by itself incur unsecured indebtedness.
13 unchanged sentences
and (v) removed the covenant requiring the Company to maintain a minimum net worth.
−Removed: In connection with the amendments, the Company capitalized $ 2.7 million in financing costs, which will be amortized through the July 15, 2022 maturity date.
+Added: connection with the amendments, the Company capitalized $ 2.7 million in financing costs, which will be amortized through the July 15, 2022 maturity date.
At the Company's option, loans outstanding under the Unsecured Credit Facility will bear interest at a rate per annum equal to (1) LIBOR plus between 0.775 % and 1.45 %, based on the Company's credit rating, or (2) a base rate equal to the greatest of (a) the Administrative Agent's prime rate, (b) the Federal Funds rate plus 0.5 % or (c) LIBOR for a one month period plus 1.00 %, in each case, plus a margin ranging from 0.0 % to 0.45 % based on the Company's credit rating.
9 unchanged sentences
In addition, the Unsecured Credit Facility restricts payments of dividends and distributions on shares in excess of 95 % of the Company's funds from operations (FFO) except to the extent necessary to enable the Company to continue to qualify as a REIT for Federal income tax purposes.
−Removed: The Company had no borrowings under the Unsecured Credit Facility as of December 31, 2019 .
+Added: The Company had no borrowings under the Unsecured Credit Facility as of December 31, 2020 and 2019.
During the twelve months ended December 31, 2020, the weighted-average interest rate on Unsecured Credit Facility borrowings was 1.48 % resulting in $ 0.5 million of interest expense.
−Removed: As of December 31, 2018 , the Company had $ 92.5 million borrowings under the Credit Facility.
During the twelve months ended December 31, 2019, the weighted-average interest rate on Unsecured Credit Facility borrowings was 3.52 % resulting in $ 4.4 million of interest expense.
3 unchanged sentences
While the Company currently believes it will remain in compliance with its covenants, in the event that the economy deteriorates in the future, the Company may not be able to remain in compliance with such covenants, in which case a default would result absent a lender waiver.
−Removed: As of December 31, 2019 , the Company’s aggregate scheduled principal payments of debt obligations, excluding amortization of discounts and premiums, are as follows (in thousands):
+Added: As of December 31, 2020, the Company’s aggregate scheduled principal payments of debt obligations are as follows (in thousands):
+Added: Thereafter 878,610
Total principal payments 1,828,610
6 unchanged sentences
Considerable judgment is necessary to interpret market data and to develop the related estimates of fair value.
−Removed: Accordingly, the estimates presented are not necessarily
−Removed: indicative of the amounts that the Company could realize upon disposition.
+Added: Accordingly, the estimates presented are not necessarily indicative of the amounts that the Company could realize upon disposition.
The use of different estimation methodologies may have a material effect on the estimated fair value amounts shown.
−Removed: The Company believes that the carrying amounts reflected in the consolidated balance sheets at December 31, 2019 and 2018 approximate the fair values for cash and cash equivalents, accounts receivable, other assets, accounts payable and accrued expenses because they are short-term in duration.
+Added: The Company believes that the carrying amounts reflected in the consolidated balance sheets at December 31, 2020 and 2019 approximate the fair values
+Added: for cash and cash equivalents, accounts receivable, other assets, accounts payable and accrued expenses because they are short-term in duration.
The following are financial instruments for which the Company’s estimates of fair value differ from the carrying amounts (in thousands):
−Removed: December 31, 2019
−Removed: December 31, 2018
−Removed: Carrying Amount (a)
−Removed: Carrying Amount (a)
+Added: December 31, 2020 December 31, 2019
+Added: Carrying Amount (a) Fair Value Carrying Amount (a) Fair Value
Unsecured notes payable $ 1,502,901 $ 1,607,310 $ 1,503,435 $ 1,591,830
2 unchanged sentences
Notes receivable $ 94,430 $ 97,372 $ 44,430 $ 43,322
−Removed: The carrying amounts presented in the table above are net of deferred financing costs of $ 8.7 million and $ 7.9 million for unsecured notes payable, $ 1.4 million and $ 2.0 million for variable rate debt and $ 0.2 million and $ 0.4 million for mortgage notes payable as of December 31, 2019 and December 31, 2018 , respectively.
−Removed: On June 26, 2018, the Company provided a $ 44.4 million mortgage loan to Brandywine 1919 Ventures, an unconsolidated real estate venture in which the Company holds a 50 % ownership interest, and recorded a note receivable of $ 44.4 million .
+Added: (a) The carrying amounts presented in the table above are net of deferred financing costs of $ 7.2 million and $ 8.7 million for unsecured notes payable, $ 0.9 million and $ 1.4 million for variable rate debt and $ 0.0 million and $ 0.2 million for mortgage notes payable as of December 31, 2020 and December 31, 2019, respectively.
+Added: On June 26, 2018, the Company provided a $ 44.4 million mortgage loan to 1919 Venture, an unconsolidated real estate venture in which the Company holds a 50 % ownership interest, and recorded a note receivable of $ 44.4 million.
For additional information regarding the transaction, see Note 4, ''Investment in Unconsolidated Real Estate Ventures.”
−Removed: As of December 31, 2018, notes receivable also consisted of a $ 3.4 million note receivable that was provided to a third party to acquire a property.
−Removed: This note was repaid during the second quarter of 2019.
The Company used quoted market prices as of December 31, 2020 and December 31, 2019 to value the unsecured notes payable and, as such, categorized them as Level 2.
16 unchanged sentences
The Company is potentially exposed to credit loss in the event of non-performance by these counterparties.
−Removed: However, because of the high credit ratings of the counterparties, the Company does not anticipate that any of
−Removed: the counterparties will fail to meet these obligations as they come due.
+Added: However, because of the high credit ratings of the counterparties, the Company does not anticipate that any of the counterparties will fail to meet these obligations as they come due.
The Company does not hedge credit or property value market risks through derivative financial instruments.
10 unchanged sentences
The notional amounts provide an indication of the extent of the Company’s involvement in these instruments at that time but do not represent exposure to credit, interest rate or market risks (amounts presented in thousands).
−Removed: Hedge Product
−Removed: Notional Amount
−Removed: Maturity Date
−Removed: Interest Rate
−Removed: January 6, 2012
−Removed: October 30, 2019
−Removed: Interest Rate
−Removed: October 8, 2015
−Removed: October 8, 2022
−Removed: Interest Rate
−Removed: December 22, 2011
−Removed: January 30, 2021
−Removed: On October 30, 2019, the interest rate hedge contract for this swap expired.
−Removed: Hedging unsecured variable rate debt.
+Added: Hedge Product Hedge Type Designation Notional Amount Strike Trade Date Maturity Date Fair value
+Added: 12/31/2020 12/31/2019 12/31/2020 12/31/2019
+Added: Swap Interest Rate Cash Flow (a) $ 250,000 $ 250,000 2.868 % October 8, 2015 October 8, 2022 $ ( 6,627 ) $ ( 562 )
+Added: Swap Interest Rate Cash Flow (a) 25,774 25,774 3.300 % December 22, 2011 January 30, 2021 ( 120 ) ( 94 )
+Added: $ 275,774 $ 275,774
+Added: (a) Hedging unsecured variable rate debt.
The Company measures its derivative instruments at fair value and records them in the “Other assets” and (“Other liabilities”) captions on the Company’s consolidated balance sheets.
3 unchanged sentences
Disclosure about the fair value of derivative instruments is based upon pertinent information available to management as of December 31, 2020 and December 31, 2019.
−Removed: Although management is not aware of any factors that would significantly affect
−Removed: the fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since December 31, 2019 .
+Added: Although management is not aware of any factors that would significantly affect the fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since December 31, 2020.
Current estimates of fair value may differ from the amounts presented herein.
Concentration of Credit Risk
−Removed: Concentrations of credit risk arise for the Company when multiple tenants of the Company are engaged in similar business activities, or are located in the same geographic region, or have similar economic features that impact in a similar manner their ability to meet contractual obligations, including those to the Company.
+Added: Concentrations of credit risk arise for the Company when multiple tenants of the Company are engaged in similar business activities, or are located in the same geographic region, or have similar economic features that impact in a similar manner
+Added: their ability to meet contractual obligations, including those to the Company.
The Company regularly monitors its tenant base to assess potential concentrations of credit risk.
2 unchanged sentences
LIMITED PARTNERS' NONCONTROLLING INTERESTS IN THE PARENT COMPANY
−Removed: Noncontrolling interests in the Parent Company’s financial statements relate to redeemable common limited partnership interests in the Operating Partnership held by parties other than the Parent Company and properties which are consolidated but not wholly owned.
+Added: Noncontrolling interests in the Parent Company’s financial statements relate to redeemable common limited partnership interests in the Operating Partnership held by parties other than the Parent Company and properties which are consolidated but not wholly owned by the Operating Partnership.
Operating Partnership
The aggregate book value of the noncontrolling interests associated with the redeemable common limited partnership interests that were consolidated in the accompanying consolidated balance sheet of the Parent Company as of December 31, 2020 and December 31, 2019, was $ 10.5 million and $ 9.3 million, respectively.
−Removed: Under the applicable accounting guidance, the redemption value of limited partnership units are carried at, on a limited partner basis, the greater of historical cost adjusted for the allocation of income and distributions or fair value.
+Added: Under the applicable accounting guidance, the redemption value of limited partnership units are carried at fair value.
The Parent Company believes that the aggregate settlement value of these interests (based on the number of units outstanding and the closing price of the common shares on the balance sheet date) was approximately $ 11.7 million and $ 15.5 million, respectively, as of December 31, 2020 and December 31, 2019.
1 unchanged sentence
Earnings per Share (EPS)
−Removed: The following tables detail the number of shares and net income used to calculate basic and diluted earnings per share (in thousands, except share and per share amounts;
+Added: The following table details the number of shares and net income used to calculate basic and diluted earnings per share (in thousands, except share and per share amounts;
results may not add due to rounding):
Year Ended December 31,
+Added: 2020 2019 2018
+Added: Basic Diluted Basic Diluted Basic Diluted
+Added: Net income $ 307,326 $ 307,326 $ 34,529 $ 34,529 $ 135,472 $ 135,472
Net income attributable to noncontrolling interests ( 1,799 ) ( 1,799 ) ( 262 ) ( 262 ) ( 954 ) ( 954 )
Nonforfeitable dividends allocated to unvested restricted shareholders ( 410 ) ( 410 ) ( 396 ) ( 396 ) ( 369 ) ( 369 )
−Removed: Distribution to preferred shareholders
−Removed: Preferred share redemption charge
Net income attributable to common shareholders $ 305,117 $ 305,117 $ 33,871 $ 33,871 $ 134,149 $ 134,149
6 unchanged sentences
The effect of these securities is anti-dilutive for periods that the Parent Company incurs a net loss from continuing operations available to common shareholders and therefore is excluded from the dilutive earnings per share calculation in such periods.
−Removed: Redeemable common limited partnership units, totaling 981,634 , 982,871 , and 1,479,799 in 2019 , 2018 , and 2017 , respectively, were excluded from the diluted earnings per share computations because they are not dilutive.
+Added: Redeemable common limited partnership units, totaling 981,634 as of December 31, 2020 and 2019 and 982,871 as of December 31, 2018, respectively, were excluded from the diluted earnings per share computations because they are not dilutive.
Unvested restricted shares are considered participating securities which require the use of the two-class method for the computation of basic and diluted earnings per share.
3 unchanged sentences
Of the 20,000,000 preferred shares authorized, none were outstanding as of December 31, 2020 or December 31, 2019.
−Removed: On April 11, 2017, the Parent Company redeemed all of its outstanding 4,000,000 Series E Preferred Shares at an aggregate redemption price of $ 25.51 per share, which includes $ 2.0 million of dividends accrued through the redemption date.
−Removed: The redemption was funded with existing cash balances on hand.
−Removed: Also, on April 11, 2017, the Parent Company recognized a $ 3.2 million charge related to the underwriting discount and related expenses incurred at issuance of the Series E Preferred Shares on April 11, 2012.
−Removed: This charge is included in the earnings per share calculations above, as well as within the Parent Company’s consolidated statements of operations as a reduction in net income to arrive at net income attributable to common shareholders under the caption “Preferred share redemption charge.” There were no comparable charges for the years ended December 31, 2019 or 2018.
Common Share Repurchases
3 unchanged sentences
During the year ended December 31, 2019, the Company repurchased and retired 1,337,169 common shares at an average price of $ 12.92 per share, totaling $ 17.3 million.
−Removed: During the year ended December 31, 2017, there were no share repurchases under the program.
+Added: During the year ended December 31, 2018, the Company repurchased and retired 1,729,278 common shares at an average price of $ 12.64 per share, totaling $ 21.9 million.
The Company expects to fund any additional share repurchases with a combination of available cash balances and availability under its unsecured revolving credit facility.
3 unchanged sentences
During the year ended December 31, 2020 the Company repurchased and retired 6,248,483 common units at an average price of $ 9.60 per unit, totaling $ 60.0 million.
+Added: During the year ended December 31, 2019, the Company repurchased and retired 1,337,169 common units at an average price of $ 12.92 per unit, totaling $ 17.3 million.
During the year ended December 31, 2018, the Company repurchased and retired 1,729,278 units at an average price of $ 12.64 per unit totaling $ 21.9 million.
6 unchanged sentences
Continuous Offering Program
−Removed: On January 10, 2017, the Parent Company entered into a continuous offering program (the “Offering Program”), under which it may sell up to an aggregate of 16,000,000 common shares until January 10, 2020 in at-the-market offerings.
−Removed: There was no activity under the Offering Program during 2019.
−Removed: During 2018 and 2017, the Parent Company issued 23,311 and 2,858,991 common shares under the Offering Program at weighted average prices per share of $ 18.04 and $ 18.19 , receiving net cash proceeds of $ 0.4 million and $ 51.2 million , respectively.
−Removed: At December 31, 2019 , 13,117,698 common shares remain available for issuance under the Offering Program.
+Added: On January 10, 2017, the Parent Company entered into a continuous offering program (the “Offering Program”), that permitted the Parent Company to sell up to an aggregate of 16,000,000 common shares in at-the-market offerings.
+Added: There was no activity under the Offering Program during 2020 and 2019.
+Added: During 2018, the Parent Company issued 23,311 common shares under the Offering Program at a weighted average price per share of $ 18.04 , receiving net cash proceeds of $ 0.4 million.
+Added: At December 31, 2020, no common shares remained available for issuance under the Offering Program, which terminated on January 10, 2020.
PARTNERS' EQUITY OF THE PARENT COMPANY
Earnings per Common Partnership Unit
−Removed: The following tables detail the number of units and net income used to calculate basic and diluted earnings per common partnership unit (in thousands, except unit and per unit amounts;
+Added: The following table details the number of units and net income used to calculate basic and diluted earnings per common partnership unit (in thousands, except unit and per unit amounts;
results may not add due to rounding):
Year Ended December 31,
+Added: 2020 2019 2018
+Added: Basic Diluted Basic Diluted Basic Diluted
+Added: Net income $ 307,326 $ 307,326 $ 34,529 $ 34,529 $ 135,472 $ 135,472
Net income attributable to noncontrolling interests ( 20 ) ( 20 ) ( 69 ) ( 69 ) ( 55 ) ( 55 )
Nonforfeitable dividends allocated to unvested restricted unitholders ( 410 ) ( 410 ) ( 396 ) ( 396 ) ( 369 ) ( 369 )
−Removed: Preferred unit dividends
−Removed: Preferred unit redemption charge
Net income attributable to common unitholders $ 306,896 $ 306,896 $ 34,064 $ 34,064 $ 135,048 $ 135,048
20 unchanged sentences
(i) Class A Limited Partnership Interest which are held by both the Parent Company and outside third parties and (ii) General Partnership Interests which are held solely by the Parent Company (collectively, the Class A Limited Partnership Interest, and General Partnership Interests are referred to as “Common Partnership Units”).
−Removed: The holders of the Common Partnership Units are entitled to share in cash distributions from, and in profits and losses of, the Operating Partnership, in proportion to their respective percentage interests, subject to preferential distributions on the preferred mirror units and the preferred units.
+Added: The holders of the Common Partnership Units are
+Added: entitled to share in cash distributions from, and in profits and losses of, the Operating Partnership, in proportion to their respective percentage interests, subject to preferential distributions on the preferred mirror units and the preferred units.
The Common Partnership Units held by the Parent Company (comprised of both General Partnership Units and Class A Limited Partnership Units) are presented as partner’s equity in the consolidated financial statements.
1 unchanged sentence
Because the form of settlement of these redemption rights are not within the control of the Operating Partnership, these Common Partnership Units have been excluded from partner’s equity and are presented as redeemable limited partnership units measured at the potential cash redemption value as of the end of the periods presented based on the closing market price of the Parent Company’s common shares at December 31, 2020, 2019 and 2018, which was $ 11.91 , $ 15.75 and $ 12.87 , respectively.
−Removed: As of December 31, 2019 , 981,634 Class A Units were outstanding and owned by outside limited partners of the Operating Partnership.
−Removed: As of December 31, 2018 and 2017 , 982,871 and 1,479,799 Class A Units were outstanding and owned by outside limited partners of the Operating Partnership, respectively.
+Added: Class A Units of 981,634 as of December 31, 2020 and 2019 and 982,871 as of December 31, 2018, respectively, were outstanding and owned by outside limited partners of the Operating Partnership.
On December 8, 2020, the Operating Partnership declared a distribution of $ 0.19 per common unit, totaling $ 32.7 million, which was paid on January 20, 2021 to unitholders of record as of January 6, 2021.
−Removed: On April 11, 2017, the Operating Partnership redeemed all of its outstanding 4,000,000 Series E-Linked Preferred Mirror Units at an aggregate redemption price of $ 25.51 per unit, which includes $ 2.0 million of dividends accrued through the redemption date.
−Removed: The redemption of preferred units was funded with existing cash balances on hand.
−Removed: Also, on April 11, 2017, the Operating Partnership recognized a $ 3.2 million charge related to the underwriting discount and related expenses incurred at issuance of the Series E-Linked Preferred Mirror Units on April 11, 2012.
−Removed: This charge is included in the earnings per share calculations above, as well as within the Operating Partnership’s consolidated statements of operations as a reduction in net income to arrive at net income attributable to common partnership unitholders under the caption “Preferred unit redemption charge.” There were no comparable charges for the years ended December 31, 2019 or 2018.
Common Unit Repurchases
1 unchanged sentence
On January 3, 2019, the Board of Trustees replenished this program by authorizing the Parent Company to repurchase of up to $ 150.0 million common shares under the program from and after January 3, 2019.
+Added: During the year ended December 31, 2020 the Company repurchased and retired 6,248,483 common units at an average price of $ 9.60 per unit, totaling $ 60.0 million.
During the year ended December 31, 2019, the Company Repurchased 1,337,169 common units at an average price of $ 12.92 per unit, totaling $ 17.3 million.
During the year ended December 31, 2018, the Company repurchased and retired 1,729,278 common units at an average price of $ 12.64 per unit, totaling $ 21.9 million.
−Removed: During the year ended December 31, 2017, there were no unit repurchases under the program.
The Company expects to fund any additional unit repurchases with a combination of available cash balances and availability under its unsecured revolving credit facility.
4 unchanged sentences
Continuous Offering Program
−Removed: On January 10, 2017, the Parent Company entered into a continuous offering program (the “Offering Program”), under which it may sell up to an aggregate of 16,000,000 common units until January 10, 2020 in at-the-market offerings.
+Added: On January 10, 2017, the Parent Company entered into a continuous offering program (the “Offering Program”), which permitted it to sell up to an aggregate of 16,000,000 common units in at-the-market offerings.
In connection with the commencement of the Offering Program, $ 0.2 million of upfront costs were recorded to General Partner Capital.
−Removed: There was no activity under the Offering Program during 2019.
−Removed: During 2018 and 2017, the Parent Company issued 23,311 and 2,858,991 common units under the Offering Program at weighted average prices per unit of $ 18.04 and $ 18.19 , receiving net cash proceeds of $ 0.4 million and $ 51.2 million , respectively.
−Removed: As of December 31, 2019 , 13,117,698 common shares remain available for issuance under the Offering Program.
+Added: There was no activity under the Offering Program during 2020 and 2019.
+Added: During 2018, the Parent Company issued 23,311 common units under the Offering Program at a weighted average price per unit of $ 18.04 , receiving net cash proceeds of $ 0.4 million.
+Added: As of December 31, 2020, no common shares remained available for issuance under the Offering Program, which terminated on January 10, 2020.
SHARE BASED COMPENSATION, 401(K) PLAN AND DEFERRED COMPENSATION
4 unchanged sentences
Options outstanding as of December 31, 2020 and changes during the year-ended December 31, 2020 were as follows:
−Removed: Weighted Average Exercise Price
−Removed: Weighted Average Remaining Contractual Term (in years)
−Removed: Aggregate Intrinsic Value (in thousands)
+Added: Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands)
Outstanding at January 1, 2020 334,561 $ 11.88 1.0
+Added: Exercised ( 34,515 ) $ 11.62 $ 10.1
Outstanding at December 31, 2020 300,046 $ 11.91 0.1 $ 81.1
6 unchanged sentences
Restricted Share Rights Awards
−Removed: As of December 31, 2019 , 479,144 restricted share rights were outstanding under the Equity Incentive Plan.
−Removed: These Restricted Share Rights vest over two to three years from the initial grant dates .
+Added: As of December 31, 2020, 488,735 restricted share rights ("Restricted Share Rights") were outstanding under the Equity Incentive Plan.
+Added: These Restricted Share Rights vest over one to three years from the initial grant dates.
The remaining compensation expense to be recognized with respect to these awards at December 31, 2020 was $ 1.8 million and is expected to be recognized over a weighted average remaining vesting period of 0.8 years.
−Removed: For the years ended December 31, 2019 , 2018 , and 2017 , the amortization related to outstanding restricted shares was $ 3.9 million (of which $ 0.3 million was capitalized), $ 3.6 million (of which $ 0.6 million was capitalized), and $ 2.8 million (of which $ 0.4 million was capitalized), respectively.
−Removed: Compensation expense related to outstanding restricted shares is included in general and administrative expense.
−Removed: The following table summarizes the Company’s restricted share activity during the year-ended December 31, 2019 :
−Removed: Weighted Average Grant Date Fair Value
−Removed: Aggregate Intrinsic Value (in thousands)
+Added: For the years ended December 31, 2020, 2019, and 2018, the amortization related to outstanding Restricted Share Rights was $ 4.3 million (of which $ 0.4 million was capitalized), $ 3.9 million (of which $ 0.3 million was capitalized), and $ 3.6 million (of which $ 0.6 million was capitalized), respectively.
+Added: Compensation expense related to outstanding Restricted Share Rights is included in general and administrative expense.
+Added: The following table summarizes the Company’s Restricted Share Rights activity during the year-ended December 31, 2020:
+Added: Shares Weighted Average Grant Date Fair Value
Non-vested at January 1, 2020 479,144 $ 15.90
+Added: Granted 295,049 $ 13.10
+Added: Vested ( 283,431 ) $ 14.20
+Added: Forfeited ( 2,027 ) $ 15.63
Non-vested at December 31, 2020 488,735 $ 15.19
−Removed: On February 21, 2019, the Compensation Committee of the Parent Company’s Board of Trustees awarded to officers of the Company an aggregate of 196,667 Restricted Share Rights, which generally vest over two to three years from the grant date .
+Added: On March 5, 2020, the Compensation Committee of the Parent Company’s Board of Trustees awarded to officers of the Company an aggregate of 183,758 Restricted Share Rights, which generally vest over three years from the grant date.
Each Restricted Share Right entitles the holder to one common share upon settlement.
3 unchanged sentences
In addition, vesting would also accelerate if the Parent Company were to undergo a change of control and, on or before the first anniversary of the change of control, the recipient’s employment were to cease due to a termination without cause or resignation with good reason.
−Removed: The Restricted Share Rights granted in 2019 to certain senior executives and that vest over three years include an “outperformance feature” whereby additional shares may be earned, up to 200 % of the shares subject to the basic award, based on the Company’s achievement of targets for same-store net operating cash income growth and development activity provided certain operating and balance sheet metrics are also achieved during the three-year period ending December 31, 2021.
−Removed: Half of any additional shares earned will vest based on continued service through each of January 1, 2022 and January 1, 2023, provided that this additional service requirement will be waived in the event of a death, disability or qualifying retirement.
−Removed: In addition to the basic award, up to 233,890 shares may be awarded under the outperformance feature.
−Removed: These shares have a $ 3.7 million intrinsic value using a $ 15.61 grant date fair value.
−Removed: As of December 31, 2019, the Company has not recognized any compensation expense for these awards as it has been determined that it is not probable that the performance metrics will be achieved.
−Removed: The Company will evaluate progression towards achievement of the performance metrics on a quarterly basis and recognize compensation expense for these awards should it be determined that achievement of these metrics is probable.
−Removed: In addition, on February 21, 2019, the Compensation Committee awarded non-officer employees an aggregate of 37,472 Restricted Share Rights that vest in three equal installments on April 15, 2020, 2021, and 2022.
+Added: The Restricted Share Rights granted in 2020 and 2019 to certain senior executives include an “outperformance feature” whereby additional shares may be earned, up to 200 % of the shares subject to the basic award, based on the Company’s achievement of targets for same-store net operating cash income growth and investment/development activity provided certain operating and balance sheet metrics are also achieved during the three-year period ending December 31, 2022 and December 31, 2021 for the 2019 and 2020 awards, respectively.
+Added: Half of any additional shares earned will vest based on continued service through each of January 1, 2023 and January 1, 2024 for the 2020 award and January 1, 2022 and January 1, 2023 for the 2019 award, provided that this additional service requirement will be waived in the event of a death, disability or qualifying retirement.
+Added: In addition to the basic award, up to 316,306 shares and 233,890 shares may be awarded under the outperformance feature for the 2020 award and 2019 award, respectively.
+Added: As of December 31, 2020, the Company has no t recognized any compensation expense related to the outperformance feature for the 2020 awards and has recognized $ 0.2 million related to the outperformance feature for the 2019 award.
+Added: The Company will continue to evaluate progress towards achievement of the performance metrics on a quarterly basis and recognize compensation expense for these awards should it be determined that achievement of these metrics is probable.
+Added: In addition, on March 5, 2020, the Compensation Committee awarded non-officer employees an aggregate of 40,920 Restricted Share Rights that vest in three equal installments on April 15, 2020, 2021, and 2022.
Vesting of these awards is subject to acceleration upon death, disability or termination without cause within one year following a change of control.
−Removed: In accordance with the accounting standard for share-based compensation, the Company amortizes share-based compensation costs through the qualifying retirement dates for those executives who meet the conditions for qualifying retirement during the scheduled vesting period and whose award agreements provide for vesting upon a qualifying retirement.
+Added: On May 20, 2020, the Compensation Committee awarded the Trustees an aggregate of 70,371 fully vested common shares.
+Added: In accordance with the accounting standard for share-based compensation, the Company amortizes share-based compensation costs through the qualifying retirement dates for those executives and Trustees who meet the conditions for qualifying retirement during the scheduled vesting period and whose award agreements provide for vesting upon a qualifying retirement.
Restricted Performance Share Units Plan
2 unchanged sentences
The table below presents certain information as to unvested RPSU awards.
+Added: RPSU Grant Date
+Added: 2/28/2018 2/21/2019 3/5/2020 Total
(Amounts below in shares, unless otherwise noted)
1 unchanged sentence
Units Granted — — 319,600 319,600
−Removed: Units Cancelled
Non-vested at December 31, 2020 190,296 206,069 319,600 715,965
7 unchanged sentences
The performance period will be abbreviated and the delivery of earned shares will be accelerated in the event of a change in control or if the recipient of the award were to die, become disabled or retire in a qualifying retirement prior to the end of the otherwise applicable three year performance period;
−Removed: In accordance with the accounting standard for share-based compensation, the Company amortizes stock-based compensation costs through the qualifying retirement date for those executives who meet the conditions for qualifying retirement during the scheduled vesting period.
+Added: provided that, in the case of qualifying retirement for the March 5, 2020 grant, the number of shares deliverable will be pro-rated based on the portion of the performance period actually worked before retirement.
+Added: In accordance with the accounting standard for share-based compensation, the Company amortizes stock-based compensation costs for the February 2019 and 2018 grants through the qualifying retirement date for those executives who meet the conditions for qualifying retirement during the scheduled vesting period.
For the year ended December 31, 2020, the Company recognized amortization of the 2020, 2019 and 2018 RPSU awards of $ 3.0 million, of which $ 0.4 million was capitalized consistent with the Company’s policies for capitalizing eligible portions of employee compensation.
−Removed: For the year ended December 31, 2018 , amortization for the 2018 , 2017 and 2016 RPSU awards was $ 3.9 million , of which $ 1.1 million was capitalized consistent with the Company’s policies for capitalizing eligible portions of employee compensation.
+Added: For the year ended December 31, 2019, amortization for the 2019, 2018 and 2017 RPSU awards
+Added: was $ 4.2 million, of which $ 0.6 million was capitalized consistent with the Company’s policies for capitalizing eligible portions of employee compensation.
For the year ended December 31, 2018, amortization for the 2018, 2017, and 2016 RPSU awards was $ 3.9 million, of which $ 1.1 million was capitalized consistent with the Company’s policies for capitalizing eligible portions of employee compensation.
−Removed: The remaining compensation expense to be recognized with respect to the non-vested RPSU's at December 31, 2019 was approximately $ 2.0 million and is expected to be recognized over a weighted average remaining vesting period of 1.7 years .
−Removed: The Company issued 147,111 common shares on February 1, 2019 in settlement of RPSUs that had been awarded on February 22, 2016 (with a three -year measurement period ended December 31, 2018).
+Added: The remaining compensation expense to be recognized with respect to the non-vested RPSU's at December 31, 2020 was approximately $ 4.5 million and is expected to be recognized over a weighted average remaining vesting period o f 1.5 years.
+Added: The Company issued 121,897 common shares on February 1, 2020 in settlement of RPSUs that had been awarded on March 1, 2017 (with a three-year measurement period ended December 31, 2019).
Holders of these RPSUs also received a cash dividend of $ 0.19 per share for these common shares on January 22, 2020.
4 unchanged sentences
In addition, the number of shares separately reserved for issuance under the ESPP is 1.25 million .
−Removed: Employees made purchases under the ESPP of $ 0.5 million in each of the years ended December 31, 2019 and 2018 and $ 0.4 million during the year ended December 31, 2017.
+Added: E mployees made purchases under the ESPP of $ 0.4 million during the year ended December 31, 2020, $ 0.5 million during the year ended December 31, 2019 and $ 0.5 million during the year ended December 31, 2018.
The Company recognized $ 0.1 million of compensation expense related to the ESPP during each of the years ended December 31, 2020, 2019, and 2018.
20 unchanged sentences
Years ended December 31,
+Added: 2020 2019 2018
(in thousands, except per share amounts)
1 unchanged sentence
Ordinary income $ 0.41 $ 0.62 $ 0.55
+Added: Capital gain 0.35 — —
Non-taxable distributions — 0.14 0.17
3 unchanged sentences
Percentage classified as non-taxable distribution — % 19.00 % 23.80 %
−Removed: Preferred Share Distributions:
−Removed: Total distributions paid
−Removed: Percentage classified as ordinary income
−Removed: Percentage classified as capital gain
−Removed: Percentage classified as non-taxable distribution
INCOME TAXES AND TAX CREDIT TRANSACTIONS
6 unchanged sentences
Valuation allowances are provided if, based upon the weight of the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.
−Removed: As of December 31, 2019 and 2018 , there were nominal deferred tax assets included within “Other assets” in the consolidated balance sheets.
−Removed: In projecting future taxable income, the analysis begins with historical results and incorporates assumptions about the amount of future state and federal pretax operating income adjusted for items that do not have tax consequences.
−Removed: The assumptions about future taxable income require significant judgment and are consistent with the plans and estimates the Company is using to manage the underlying businesses.
+Added: As of December 31, 2020 there were no deferred tax assets included within “Other assets” in the consolidated balance sheets.
+Added: As of December 31, 2019, there were nominal deferred tax assets included within “Other assets” in the consolidated balance sheets.
The Company had no accruals for tax uncertainties as of December 31, 2020 and December 31, 2019.
−Removed: For the year ended December 31, 2019 , there were $ 0.1 million of deferred income tax expense and $ 0.1 million of current income tax benefit.
−Removed: For the year ended December 31, 2018 , there were $ 0.3 million of deferred income tax expense and $ 0.1 of current income tax expense.
−Removed: For the year ended December 31, 2017 , there were $ 0.6 million of deferred income tax benefit.
+Added: For the year ended December 31, 2020, there was no deferred income tax expense and $ 0.2 million of current income tax benefit.
+Added: For the year ended December 31, 2019, there was $ 0.1 million of deferred income tax expense and $ 0.1 million of current income tax benefit.
+Added: For the year ended December 31, 2018, there was $ 0.3 million of deferred income tax expense and $ 0.1 million of current income tax expense.
These amounts are included in “Income tax (provision) benefit” in the consolidated statements of operations.
1 unchanged sentence
The following table details the components of accumulated other comprehensive income (loss) of the Parent Company and the Operating Partnership as of and for the three years ended December 31, 2020 (in thousands):
−Removed: Parent Company
−Removed: Cash Flow Hedges
+Added: Parent Company Cash Flow Hedges
Balance at January 1, 2018 $ 2,399
11 unchanged sentences
Balance at December 31, 2020 $ ( 7,561 )
−Removed: Operating Partnership
−Removed: Cash Flow Hedges
+Added: Operating Partnership Cash Flow Hedges
Balance at January 1, 2018 $ 2,056
22 unchanged sentences
Land held for development and construction in progress is transferred to operating properties by region upon completion of the associated construction or project.
−Removed: The following tables provide selected asset information and results of operations of the Company’s reportable segments as of and for the three years ended December 31, 2019 , 2018 and 2017 (in thousands):
+Added: The following tables provide selected asset information as of December 31, 2020 and 2019 and results of operations of the Company’s reportable segments for the years ended December 31, 2020, 2019 and 2018 (in thousands):
Real estate investments, at cost:
−Removed: December 31, 2019
−Removed: December 31, 2018
−Removed: December 31, 2017
+Added: December 31, 2020 December 31, 2019
Philadelphia CBD $ 1,433,927 $ 1,726,299
Pennsylvania Suburbs 871,530 1,003,890
−Removed: Austin, Texas (a)
+Added: Austin, Texas 728,741 721,255
Metropolitan Washington, D.C.
+Added: 352,794 468,035
+Added: Other 87,117 86,980
Operating Properties $ 3,474,109 $ 4,006,459
−Removed: Right of use asset - operating leases, net (c)
+Added: Right of use asset - operating leases, net $ 20,977 $ 21,656
Construction-in-progress $ 210,311 $ 180,718
−Removed: Land held for development (d)
−Removed: Prepaid leasehold interests in land held for development, net (e)
−Removed: Refer to Note 3, ''Real Estate Investments ,” for details related to the Company's acquisition of DRA Advisors' ownership interest in the Austin Venture in December 2018.
−Removed: Refer to Note 4, ''Investment in Unconsolidated Real Estate Ventures .” for details of the Company's transaction with the Herndon Innovation Center Metro Portfolio Venture, LLC in December 2018.
−Removed: Refer to Note 2, ''Summary of Significant Accounting Policies ,” for further information on the impact of adoption of Topic 842.
−Removed: Does not include 35.2 acres, 37.9 acres, and 13.1 acres of land classified as held for sale as of December 31, 2019, 2018, and 2017, respectively.
−Removed: Refer to Note 3, ''Real Estate Investments ,” for further information.
−Removed: Includes leasehold interests in prepaid 99 -year ground leases at 3025 and 3001-3003 JFK Boulevard, in Philadelphia, Pennsylvania as of December 31, 2019 and December 31, 2018 .
−Removed: Refer to Note 3, ''Real Estate Investments ,” for further information.
−Removed: Year Ended December 31,
−Removed: Total revenue
−Removed: Operating expenses (a)
−Removed: Net operating income (loss)
−Removed: Total revenue
−Removed: Operating expenses (a)
−Removed: Net operating income (loss)
−Removed: Total revenue
−Removed: Operating expenses (a)
+Added: Land held for development $ 117,984 $ 96,124
+Added: Prepaid leasehold interests in land held for development, net $ 39,185 $ 39,592
Net operating income:
+Added: Year Ended December 31,
+Added: 2020 2019 2018
+Added: Total revenue Operating expenses (a) Net operating income (loss) Total revenue Operating expenses (a) Net operating income (loss) Total revenue Operating expenses (a) Net operating income (loss)
Philadelphia CBD $ 232,028 $ ( 82,505 ) $ 149,523 $ 263,769 $ ( 100,219 ) $ 163,550 $ 256,717 $ ( 99,449 ) $ 157,268
2 unchanged sentences
Metropolitan Washington, D.C.
+Added: 40,223 ( 20,791 ) 19,432 51,498 ( 23,455 ) 28,043 90,308 ( 34,072 ) 56,236
+Added: Other 13,469 ( 9,815 ) 3,654 14,558 ( 9,328 ) 5,230 16,757 ( 11,888 ) 4,869
+Added: Corporate 4,537 ( 6,305 ) ( 1,768 ) 5,351 ( 7,141 ) ( 1,790 ) 3,619 ( 6,518 ) ( 2,899 )
Operating properties
−Removed: Includes property operating expense, real estate taxes and third party management expense.
+Added: $ 534,852 $ ( 205,456 ) $ 329,396 $ 580,417 $ ( 225,846 ) $ 354,571 $ 544,345 $ ( 218,099 ) $ 326,246
+Added: (a) Includes property operating expense, real estate taxes and third party management expense.
Unconsolidated real estate ventures:
−Removed: Investment in real estate ventures, at equity
−Removed: Equity in income (loss) of real estate venture
−Removed: Years ended December 31,
−Removed: December 31, 2019
−Removed: December 31, 2018
−Removed: December 31, 2017
+Added: Investment in real estate ventures, at equity Equity in income (loss) of real estate venture
+Added: As of Years ended December 31,
+Added: December 31, 2020 December 31, 2019 2020 2019 2018
Philadelphia CBD $ 268,562 $ 17,524 $ ( 9,090 ) $ 328 $ ( 105 )
−Removed: Pennsylvania Suburbs
Metropolitan Washington, D.C.
−Removed: Austin, Texas (b)
−Removed: Refer to Note 4, ''Investment in Unconsolidated Real Estate Ventures ," for details of the Company's transaction with the Herndon Innovation Center Metro Portfolio Venture, LLC in December 2018.
−Removed: Refer to Note 3, ''Real Estate Investments ," for details related to the Company's acquisition of DRA Advisors' ownership interest in the Austin Venture in December 2018.
−Removed: Net operating income (“NOI”) is a non-GAAP financial measure defined as total revenue less property operating expenses, real estate taxes, and third party management expenses.
+Added: 99,769 102,840 ( 3,019 ) ( 4,234 ) ( 15,065 )
+Added: Mid-Atlantic Office JV 32,996 — 96 — —
+Added: MAP Venture ( 11,516 ) ( 70 ) ( 6,571 ) ( 6,102 ) ( 2,155 )
+Added: Other — — — 86 407
+Added: Austin, Texas — — — — 1,687
+Added: Total $ 389,811 $ 120,294 $ ( 18,584 ) $ ( 9,922 ) $ ( 15,231 )
+Added: Net operating income (“NOI”) is a non-GAAP financial measure, which we define as total revenue less property operating expenses, real estate taxes, and third party management expenses.
Property operating expenses that are included in determining NOI consist of costs that are necessary and allocable to our operating properties such as utilities, property-level salaries, repairs and maintenance, property insurance, management fees, and bad debt expense.
General and administrative expenses that are not reflected in NOI primarily consist of corporate-level salaries, amortization of share awards and professional fees that are incurred as part of corporate office management.
−Removed: All companies may not calculate NOI in the same manner.
+Added: NOI presented by the Company may not be comparable to NOI reported by other companies that define NOI differently.
NOI is the measure that is used by the Company to evaluate the operating performance of its real estate assets by segment.
−Removed: The Company believes NOI provides useful information to investors regarding the financial condition and results of operations because it reflects only those income and expense items that are incurred at the property level.
+Added: The Company believes NOI provides useful
+Added: information to investors regarding the financial condition and results of operations because it reflects only those income and expense items that are incurred at the property level.
While NOI is a relevant and widely used measure of operating performance of real estate investment trusts, it does not represent cash flow from operations or net income as defined by GAAP and should not be considered as an alternative to those measures in evaluating our liquidity or operating performance.
3 unchanged sentences
Year Ended December 31,
+Added: 2020 2019 2018
+Added: Net income $ 307,326 $ 34,529 $ 135,472
Interest expense 73,911 81,512 78,199
19 unchanged sentences
The Company does not expect that the liabilities, if any, that may ultimately result from such legal actions will have a material adverse effect on the consolidated financial position, results of operations or cash flows of the Company.
−Removed: Letters-of-Credit
−Removed: Under certain mortgages, the Company has funded required leasing and capital reserve accounts for the benefit of the mortgage lenders with letters-of-credit.
−Removed: There were no associated letters-of-credit for a mortgage lender on December 31, 2019 .
−Removed: of the tenant rents at properties that secure these mortgage loans are deposited into the loan servicer’s depository accounts, which are used to fund debt service, operating expenses, capital expenditures and the escrow and reserve accounts, as necessary.
−Removed: Any excess cash is included in cash and cash equivalents.
Environmental
5 unchanged sentences
The allocated purchase price included contingent consideration of $ 2.0 million payable to the seller upon commencement of development.
−Removed: The liability was recorded at a fair value of $ 1.6 million and will accrete through interest expense to $ 2.0 million over the expected period until development is commenced.
−Removed: The fair value of this contingent consideration was determined using a probability weighted discounted cash flow model.
+Added: The liability was recorded at a fair value of $ 1.6 million and has fully accreted through interest expense to $ 2.0 million as of December 31, 2020.
+Added: The fair value of this contingent consideration was determined using a probability weighted discounted cash flow model based on the period until development was originally expected to commence.
The significant inputs to the discounted cash flow model were the discount rate and weighted probability scenarios.
−Removed: As the inputs are unobservable, the Company determined the inputs used to value this liability fall within Level 3 for fair value reporting.
−Removed: As of December 31, 2019 , the liability had accreted to $ 1.97 million .
−Removed: As there were no significant changes to the inputs, the liability remains within Level 3 for fair value reporting.
+Added: As the inputs were unobservable, the Company determined the inputs used to value this liability fall within Level 3 for fair value reporting.
Debt Guarantees
−Removed: As of December 31, 2019 , the Company’s Real Estate Ventures had aggregate indebtedness of $ 596.0 million .
−Removed: These loans are generally mortgage or construction loans, most of which are non-recourse to the Company, except for customary carve-outs.
−Removed: As of December 31, 2019 , the $ 150.0 million construction loan obtained by the 4040 Wilson, for which the Company has guaranteed payment up to $ 41.3 million , is recourse to the Company.
+Added: As of December 31, 2020, the Real Estate Ventures had aggregate indebtedness of $ 963.2 million.
+Added: These loans are generally mortgage or construction loans, most of which are non-recourse to the Company, except for customary recourse carve-outs.
+Added: As of December 31, 2020, the $ 150.0 million construction loan obtained by 4040 Wilson, for which the Company has guaranteed payment up to $ 41.3 million, is recourse to the Company.
In addition, during construction undertaken by real estate ventures, including 4040 Wilson, the Company has provided and expects to continue to provide cost overrun and completion guarantees, with rights of contribution among partners or members in the real estate ventures, as well as customary environmental indemnities and guarantees of customary exceptions to nonrecourse provisions in loan agreements.
Other Commitments or Contingencies
−Removed: In connection with the Schuylkill Yards Project, the Company entered into a neighborhood engagement program and, as of December 31, 2019, had $ 8.5 million of future contractual obligations.
+Added: In connection with the Schuylkill Yards Project, the Company entered into a neighborhood engagement program and, as of December 31, 2020, had $ 7.7 million of future fixed contractual obligations.
The Company is also committed to make additional contributions under the program.
−Removed: As of December 31, 2019, the Company estimates that these additional contributions, which are not fixed under the terms of agreement, will be $ 2.8 million .
−Removed: The Company is under contract to acquire an office property containing approximately 170,000 rentable square feet located in Radnor, Pennsylvania for a purchase price of $ 20.3 million .
−Removed: The Company has paid $ 1 million towards the purchase price in the form of a non-refundable deposit and the transaction is expected to close during 2020.
−Removed: The Company was also under contract to acquire a 7.8 -acre land parcel located in Radnor, Pennsylvania for a purchase price of $ 11.3 million .
−Removed: The acquisition of the land parcel closed on February 27, 2020.
−Removed: As part of the Company’s September 2004 acquisition of a portfolio of properties from The Rubenstein Company (which the Company refers to as the “TRC acquisition”), the Company acquired its interest in Two Logan Square, a 708,844 square foot office building in Philadelphia, primarily through its ownership of a second and third mortgage secured by this property.
+Added: As of December 31, 2020, the Company estimates that, as of December 31, 2020, these additional contributions, which are not fixed under the terms of agreement, will be $ 2.6 million.
+Added: In connection with the formation of the Commerce Square Venture, the Company has committed to investing an additional $ 20.0 million of preferred equity in the properties on a pari passu basis with its joint venture partner.
+Added: As part of the Company’s September 2004 acquisition of a portfolio of properties from The Rubenstein Company (which the Company refers to as the “TRC acquisition”), the Company acquired its interest in Two Logan Square, a 708,844 square foot office building in Philadelphia, Pennsylvania primarily through its ownership of a second and third mortgage secured by this property.
This property is consolidated, as the borrower is a variable interest entity and the Company, through its ownership of the second and third mortgages, is the primary beneficiary.
−Removed: The Company currently does not expect to take title to Two Logan Square until, at the earliest, on or about August 2020.
−Removed: If the Company takes fee title to Two Logan Square upon foreclosure of its mortgage, the Company has agreed to pay an unaffiliated third party that holds a residual interest in the fee owner of this property an amount equal to $ 2.9 million .
−Removed: On the TRC acquisition date, the Company recorded a liability of $ 0.7 million and has been accreting the liability up to $ 2.9 million through January 2020.
−Removed: As of December 31, 2019 , the Company had a balance of $ 2.9 million for this liability in its consolidated balance sheets.
−Removed: As part of the Company’s 2006 merger with Prentiss Properties Trust (“Prentiss”), the 2004 TRC acquisition and several of our other transactions, the Company agreed not to sell certain of the properties it acquired in transactions that would trigger taxable income to the former owners.
−Removed: In the case of the TRC acquisition, the Company agreed not to sell acquired properties in non-exempt transactions for periods up to 15 years from the date of the TRC acquisition as follows at December 31, 2019 :
−Removed: One Logan Square, Two Logan Square and Radnor Corporate Center (January 2020).
−Removed: The Company subsequently agreed to extend the no-sale period applicable to Two Logan Square to on or about August 2020.
−Removed: If the Company were to sell a restricted property before the expiration of the restricted period in a non-exempt transaction, the Company may be required to make significant payments to the parties who sold the applicable property on account of tax liabilities attributed to them.
+Added: On October 21, 2020, the Company also acquired the $ 79.8 million first mortgage on the property from the third-party mortgage lender pursuant to an agreement with certain of the former owners.
+Added: Under the agreement, the Company has agreed to not take title to Two Logan until the earlier of June 2026 or the occurrence of certain events related to the ownership interests of certain former owners.
+Added: If the Company were to sell the restricted property before the expiration of the restricted period in a non-exempt transaction, the Company may be required to make significant payments to certain of the former owners of Two Logan Square on account of tax liabilities attributed to them.
+Added: Additionally, the Company will be required to pay these certain former owners an amount estimated at approximately $ 0.9 million to redeem their residual interest in the fee owner of this property.
+Added: The $ 0.9 million payment is included within "Other liabilities" on the consolidated balance sheets.
Similarly, as part of the 2013 acquisition of substantially all of the equity interests in the partnerships that own One and Two Commerce Square, the Company agreed, for the benefit of affiliates of the holder of the 1 % residual ownership interest in these properties, to not sell these two properties in certain taxable transactions prior to October 20, 2021 without the holder’s consent.
−Removed: As part of the Company’s acquisition of properties from time to time in tax-deferred transactions, the Company has agreed to provide certain of the prior owners of the acquired properties with the right to guarantee the Company’s indebtedness.
+Added: The Commerce Square Venture Transaction did not violate such covenant.
+Added: As part of the Company’s acquisition of properties from time to time in tax-deferred transactions, the Company has agreed to provide certain of the prior owners of the acquired properties the right to guarantee Company indebtedness.
If the Company were to seek to repay the indebtedness guaranteed by the prior owner before the expiration of the applicable agreement, the Company would be required to provide the prior owner an opportunity to guaranty qualifying replacement debt.
These debt maintenance agreements may limit the Company’s ability to refinance indebtedness on terms favorable to the Company.
−Removed: As part of our 2013 acquisition of substantially all of the equity interests in the partnerships that own One and Two Commerce Square, the Company agreed, for the benefit of affiliates of the holder of the 1 % residual ownership interest in these properties, to maintain qualifying mortgage debt through October 20, 2021, in the amounts of not less than $ 125.0 million on One Commerce Square and $ 100.0 million on Two Commerce Square.
−Removed: Similarly, the Company has agreements in place with other contributors of assets that obligate it to maintain debt available for them to guaranty.
+Added: As part of its 2013 acquisition of substantially all of the equity interests in the partnerships that own One and Two Commerce Square, the Company agreed, for the benefit of affiliates of the holder of the 1 % residual ownership interest in these
+Added: properties, to maintain qualifying mortgage debt through October 20, 2021, in the amounts of not less than $ 125.0 million on One Commerce Square and $ 100.0 million on Two Commerce Square.
+Added: Similarly, the Company agreed with other contributors of assets that obligate it to maintain debt available for them to guaranty.
The Company invests in its properties and regularly incurs capital expenditures in the ordinary course of business to maintain the properties.
2 unchanged sentences
These contracts typically provide for cancellation with insignificant or no cancellation penalties.
−Removed: SUMMARY OF QUARTERLY RESULTS (UNAUDITED)
−Removed: The following is a summary of quarterly financial information as of and for the years ended December 31, 2019 and 2018 (in thousands, except per share data):
−Removed: Brandywine Realty Trust
−Removed: Total revenue
−Removed: Net income allocated to Common Shares
−Removed: Basic earnings per Common Share
−Removed: Diluted earnings per Common Share
−Removed: Total revenue
−Removed: Net income (loss)
−Removed: Net income (loss) allocated to Common Shares
−Removed: Basic earnings (loss) per Common Share
−Removed: Diluted earnings (loss) per Common Share
−Removed: The summation of quarterly earnings per share amounts does not necessarily equal the full year amounts due to rounding.
−Removed: Driven by a $ 56.9 million impairment charge related to eight office properties in the Company’s Metropolitan Washington, D.C.
−Removed: See Note 3, ''Real Estate Investments ,” for further information.
−Removed: The increase in fourth quarter revenues primarily relates to the acquisition of the Austin Portfolio, located in Austin, Texas, on December 11, 2018.
−Removed: See Note 3, ''Real Estate Investments ,” for further information on this transaction.
−Removed: Increase primarily relates to gains of $ 103.8 million and $ 28.3 million , recorded in the “Net gain on real estate venture transactions” and “Gain on promoted interest in unconsolidated real estate venture” captions within the Company’s consolidated statements of operations, respectively, from the Austin Portfolio transaction.
−Removed: For further details, see Note 3, ''Real Estate Investments ."
−Removed: Increase primarily related to a gain of $ 8.0 million recorded in the "Net gains on real estate venture transactions" within the Company's consolidated statement of operations from the sale of three PJP Ventures properties.
−Removed: For further details, see Note 4, "Investment in Unconsolidated Joint Ventures."
−Removed: Brandywine Operating Partnership, L.P.
−Removed: Total revenue
−Removed: Net income attributable to Common Partnership Unitholders
−Removed: Basic earnings per Common Partnership Unit
−Removed: Diluted earnings per Common Partnership Unit
−Removed: Total revenue
−Removed: Net income (loss)
−Removed: Net income (loss) attributable to Common Partnership Unitholders
−Removed: Basic earnings (loss) per Common Partnership Unit
−Removed: Diluted earnings (loss) per Common Partnership Unit
−Removed: The summation of quarterly earnings per share amounts does not necessarily equal the full year amounts due to rounding.
−Removed: Driven by a $ 56.9 million impairment charge related to eight office properties in the Company’s Metropolitan Washington, D.C.
−Removed: See Note 3, ''Real Estate Investments ,” for further information.
−Removed: The increase in fourth quarter revenues primarily relates to the acquisition of the Austin Portfolio, located in Austin, Texas, on December 11, 2018.
−Removed: See Note 3, ''Real Estate Investments ,” for further information on this transaction.
−Removed: Increase primarily relates to gains of $ 103.8 million and $ 28.3 million , recorded in the “Net gain on real estate venture transactions” and “Gain on promoted interest in unconsolidated real estate venture” captions within the Company’s consolidated statements of operations, respectively, from the Austin Portfolio transaction.
−Removed: For further details, see Note 3, ''Real Estate Investments ."
−Removed: Increase primarily related to a gain of $ 8.0 million recorded in the "Net gains on real estate venture transactions" within the Company's consolidated statement of operations from the sale of three PJP Ventures properties.
−Removed: For further details, see Note 4, "Investment in Unconsolidated Joint Ventures."
+Added: SUBSEQUENT EVENTS
+Added: On February 2, 2021, the Company formed a joint venture with an unaffiliated third party to develop a 570,000 square foot mixed-use building at property under a long-term ground lease of 3025 JFK Boulevard, Philadelphia, Pennsylvania, also known as "Schuylkill Yards West." The estimated project cost is approximately $ 287 million, and the joint venture partner has agreed, subject to customary funding conditions, to fund up to approximately $ 58 million of the project costs in exchange for a 45 % preferred equity interest in the venture.
+Added: We have agreed to provide a completion guaranty in connection with the development of the project.
Brandywine Realty Trust and Brandywine Operating Partnership, L.P.
1 unchanged sentence
(in thousands)
−Removed: Balance at Beginning of Year
−Removed: Deductions (1)
−Removed: Balance at End of Year
+Added: Description Balance at Beginning of Year Additions Deductions (1) Balance at End of Year
Allowance for doubtful accounts:
7 unchanged sentences
(in thousands)
−Removed: Gross Amount Which Carried
+Added: Initial Cost Gross Amount Which Carried
December 31, 2020
−Removed: Property Name
−Removed: Encumbrances (a)
−Removed: Building & Improvements
−Removed: Net Improvements (Retirements) Since Acquisition
−Removed: Building & Improvements
−Removed: Accumulated Depreciation at December 31, 2019 (c)
−Removed: Year of Construction
−Removed: Year Acquired
−Removed: Depreciable Life
+Added: Property Name City State Land Building & Improvements Net Improvements (Retirements) Since Acquisition Land Building & Improvements Total (a) Accumulated Depreciation at December 31, 2020 (b)
+Added: Year of Construction Year Acquired Depreciable Life
PENNSYLVANIA SUBURBS
−Removed: 400 Berwyn Park
−Removed: 300 Berwyn Park
−Removed: 1050 Westlakes Drive
−Removed: 1200 Swedesford Road
−Removed: 200 Berwyn Park
−Removed: 1180 Swedesford Road
−Removed: 100 Berwyn Park
−Removed: 1160 Swedesford Road
−Removed: 1100 Cassett Road
−Removed: Six Tower Bridge (181 Washington Street)
−Removed: 52 Swedesford Square
−Removed: East Whiteland Twp.
−Removed: 640 Freedom Business Center (g)
−Removed: King Of Prussia
−Removed: 620 Freedom Business Center (g)
−Removed: King Of Prussia
−Removed: 1000 First Avenue
−Removed: King Of Prussia
−Removed: 1060 First Avenue
−Removed: King Of Prussia
−Removed: 630 Freedom Business Center Drive (g)
−Removed: King Of Prussia
−Removed: 1020 First Avenue
−Removed: King Of Prussia
−Removed: 1040 First Avenue
−Removed: King Of Prussia
−Removed: 610 Freedom Business Center Drive (g)
−Removed: King Of Prussia
−Removed: 650 Park Avenue
−Removed: King Of Prussia
−Removed: 600 Park Avenue
−Removed: King Of Prussia
−Removed: 933 First Avenue
−Removed: King Of Prussia
−Removed: 500 North Gulph Road
−Removed: King Of Prussia
−Removed: 401 Plymouth Road
−Removed: Plymouth Meeting
−Removed: Metroplex (4000 Chemical Road)
−Removed: Plymouth Meeting
−Removed: 610 West Germantown Pike
−Removed: Plymouth Meeting
−Removed: 600 West Germantown Pike
−Removed: Plymouth Meeting
−Removed: 630 West Germantown Pike
−Removed: Plymouth Meeting
−Removed: 620 West Germantown Pike
−Removed: Plymouth Meeting
−Removed: 660 West Germantown Pike
−Removed: Plymouth Meeting
−Removed: 351 Plymouth Road
−Removed: Plymouth Meeting
−Removed: 150 Radnor Chester Road
−Removed: One Radnor Corporate Center
−Removed: 201 King of Prussia Road
−Removed: 555 Lancaster Avenue
−Removed: Four Radnor Corporate Center
−Removed: Five Radnor Corporate Center
−Removed: Three Radnor Corporate Center
−Removed: Two Radnor Corporate Center
−Removed: 130 Radnor Chester Road
−Removed: 170 Radnor Chester Road
−Removed: 200 Radnor Chester Road
−Removed: 101 West Elm Street
−Removed: 1 West Elm Street
−Removed: Four Tower Bridge (200 Barr Harbor Drive)
−Removed: Gross Amount Which Carried December 31, 2019
−Removed: Property Name
−Removed: Encumbrances (a)
−Removed: Building & Improvements
−Removed: Net Improvements (Retirements) Since Acquisition
−Removed: Building & Improvements
−Removed: Accumulated Depreciation at December 31, 2019 (c)
−Removed: Year of Construction
−Removed: Year Acquired
−Removed: Depreciable Life
+Added: Six Tower Bridge (181 Washington Street) Conshohocken PA $ 6,927 $ 14,722 $ 2,166 $ 6,237 $ 17,578 $ 23,815 $ 4,228 1999 2013 (c)
+Added: 426 West Lancaster Avenue Devon PA 1,689 6,756 8,833 1,686 15,592 17,278 512 1990 1998 (c)
+Added: 52 Swedesford Square East Whiteland Twp.
+Added: PA 4,241 16,579 ( 20,820 ) — — — — 1988 1998 (c)
+Added: 640 Freedom Business Center (d) King Of Prussia PA 1,015 20,098 4,838 387 25,564 25,951 15,229 1991 1998 (c)
+Added: 620 Freedom Business Center (d) King Of Prussia PA 666 13,118 1,888 252 15,420 15,672 9,416 1986 1998 (c)
+Added: 1000 First Avenue King Of Prussia PA — 13,708 3,235 — 16,943 16,943 11,450 1980 1998 (c)
+Added: 1060 First Avenue King Of Prussia PA — 13,665 4,279 — 17,944 17,944 11,741 1987 1998 (c)
+Added: 630 Freedom Business Center Drive (d) King Of Prussia PA 666 13,251 3,497 255 17,159 17,414 10,139 1989 1998 (c)
+Added: 1020 First Avenue King Of Prussia PA — 10,744 4,306 — 15,050 15,050 9,726 1984 1998 (c)
+Added: 1040 First Avenue King Of Prussia PA — 14,142 5,218 — 19,360 19,360 12,870 1985 1998 (c)
+Added: 610 Freedom Business Center Drive (d) King Of Prussia PA 485 9,602 2,554 185 12,456 12,641 7,514 1985 1998 (c)
+Added: 650 Park Avenue King Of Prussia PA 1,916 4,378 ( 4,378 ) 1,916 — 1,916 — 1968 1998 (c)
+Added: 600 Park Avenue King Of Prussia PA 1,012 4,048 385 1,012 4,433 5,445 2,768 1964 1998 (c)
+Added: 933 First Avenue King Of Prussia PA 3,127 20,794 ( 1,125 ) 3,127 19,669 22,796 3,085 2017 N/A (c)
+Added: 500 North Gulph Road King Of Prussia PA 1,303 5,201 21,471 1,303 26,672 27,975 2,363 1979 1996 (c)
+Added: 401 Plymouth Road Plymouth Meeting PA 6,199 16,131 15,658 6,199 31,789 37,988 15,816 2001 2000 (c)
+Added: Metroplex (4000 Chemical Road) Plymouth Meeting PA 4,373 24,546 4,627 4,373 29,173 33,546 8,071 2007 2001 (c)
+Added: 610 West Germantown Pike Plymouth Meeting PA 3,651 14,514 3,578 3,651 18,092 21,743 8,855 1987 2002 (c)
+Added: 600 West Germantown Pike Plymouth Meeting PA 3,652 15,288 2,463 3,652 17,751 21,403 8,450 1986 2002 (c)
+Added: 630 West Germantown Pike Plymouth Meeting PA 3,558 14,743 2,189 3,558 16,932 20,490 8,115 1988 2002 (c)
+Added: 620 West Germantown Pike Plymouth Meeting PA 3,572 14,435 1,866 3,572 16,301 19,873 7,411 1990 2002 (c)
+Added: 660 West Germantown Pike Plymouth Meeting PA 3,694 5,487 19,682 5,405 23,458 28,863 6,822 1987 2012 (c)
+Added: 351 Plymouth Road Plymouth Meeting PA 1,043 555 — 1,043 555 1,598 218 N/A 2000 (c)
+Added: 150 Radnor Chester Road Radnor PA 11,925 36,986 21,658 11,897 58,672 70,569 20,187 1983 2004 (c)
+Added: One Radnor Corporate Center Radnor PA 7,323 28,613 19,813 7,323 48,426 55,749 30,728 1998 2004 (c)
+Added: 201 King of Prussia Road Radnor PA 8,956 29,811 4,307 8,949 34,125 43,074 20,508 2001 2004 (c)
+Added: 555 Lancaster Avenue Radnor PA 8,014 16,508 19,871 8,609 35,784 44,393 20,245 1973 2004 (c)
+Added: Four Radnor Corporate Center Radnor PA 5,406 21,390 12,633 5,705 33,724 39,429 17,020 1995 2004 (c)
+Added: Five Radnor Corporate Center Radnor PA 6,506 25,525 8,906 6,578 34,359 40,937 13,689 1998 2004 (c)
+Added: Three Radnor Corporate Center Radnor PA 4,773 17,961 2,173 4,791 20,116 24,907 10,527 1998 2004 (c)
+Added: Two Radnor Corporate Center Radnor PA 3,937 15,484 2,879 3,942 18,358 22,300 10,463 1998 2004 (c)
+Added: 130 Radnor Chester Road Radnor PA 2,573 8,338 ( 134 ) 2,567 8,210 10,777 3,764 1983 2004 (c)
+Added: 170 Radnor Chester Road Radnor PA 2,514 8,147 1,728 2,509 9,880 12,389 4,784 1983 2004 (c)
+Added: 200 Radnor Chester Road Radnor PA 3,366 — 3,621 3,366 3,621 6,987 857 2014 2005 (c)
+Added: 101 West Elm Street W.
+Added: Conshohocken PA 6,251 25,209 2,940 6,251 28,149 34,400 10,949 1999 2005 (c)
+Added: 1 West Elm Street W.
+Added: Conshohocken PA 3,557 14,249 984 3,557 15,233 18,790 5,955 1999 2005 (c)
+Added: Four Tower Bridge (200 Barr Harbor Drive) W.
+Added: Conshohocken PA 6,000 14,734 390 6,000 15,124 21,124 1,213 1998 2018 (c)
+Added: Initial Cost Gross Amount Which Carried December 31, 2020
+Added: Property Name City State Land Building & Improvements Net Improvements (Retirements) Since Acquisition Land Building & Improvements Total (a) Accumulated Depreciation at December 31, 2020 (b)
+Added: Year of Construction Year Acquired Depreciable Life
PHILADELPHIA CBD
−Removed: Cira Centre (2929 Arch Street)
−Removed: Three Logan Square (1717 Arch Street)
−Removed: Two Commerce Square (2001 Market Street)
−Removed: One Logan Square (130 North 18th Street)
−Removed: Two Logan Square (100 North 18th Street)
−Removed: One Commerce Square (2005 Market Street)
−Removed: Cira Centre South Garage (129 South 30th Street)
−Removed: 1900 Market Street
−Removed: 3020 Market Street
−Removed: 618-634 Market Street
−Removed: FMC Tower at Cira Centre South (2929 Walnut Street)
−Removed: 2100 Market Street
−Removed: 3000 Market Street (e)
−Removed: The Bulletin Building (3025 Market Street) (e)
−Removed: 3001-3003 JFK Boulevard (f)
−Removed: 3025 JFK Boulevard (f)
+Added: Cira Centre (2929 Arch Street) Philadelphia PA — 208,570 ( 16,549 ) 12,586 179,435 192,021 68,536 2005 N/A (c)
+Added: Three Logan Square (1717 Arch Street) Philadelphia PA — 98,188 83,981 25,195 156,974 182,169 46,611 1990 2010 (c)
+Added: One Logan Square (130 North 18th Street) Philadelphia PA 14,496 107,736 29,992 14,473 137,751 152,224 67,932 1998 2004 (c)
+Added: Two Logan Square (100 North 18th Street) Philadelphia PA 16,066 100,255 27,936 16,066 128,191 144,257 53,177 1988 2004 (c)
+Added: Cira Centre South Garage (129 South 30th Street) (d) Philadelphia PA — 76,008 26,961 6,816 96,153 102,969 22,377 2010 N/A (c)
+Added: 1900 Market Street Philadelphia PA 7,768 17,263 63,616 7,768 80,879 88,647 20,545 1981 2012 (c)
+Added: 3020 Market Street Philadelphia PA — 21,417 7,827 — 29,244 29,244 11,501 1959 2011 (c)
+Added: 618-634 Market Street Philadelphia PA 13,365 5,791 2,810 13,365 8,601 21,966 6,522 1966 2015 (c)
+Added: FMC Tower at Cira Centre South (2929 Walnut Street) Philadelphia PA — 400,294 18,005 — 418,299 418,299 63,196 2016 N/A (c)
+Added: 2100 Market Street Philadelphia PA 18,827 — 6,433 18,854 6,406 25,260 1,517 N/A 2015 (c)
+Added: 1505-11 Race Street Philadelphia PA 3,662 6,061 8 3,670 6,061 9,731 25 1922 2020 (c)
+Added: The Bulletin Building (3025 Market Street) (e) Philadelphia PA — 24,377 42,669 — 67,046 67,046 4,405 1953 2017 (c)
+Added: 3001-3003 JFK Boulevard (f) Philadelphia PA — — 111 — 111 111 17 N/A 2018 N/A
+Added: 3025 JFK Boulevard (f) Philadelphia PA — — — — — — — N/A 2018 N/A
METROPOLITAN WASHINGTON, D.C.
−Removed: 6600 Rockledge Drive
−Removed: 2340 Dulles Corner Boulevard
−Removed: 1676 International Drive
−Removed: 8260 Greensboro Drive
−Removed: 2273 Research Boulevard
−Removed: 2275 Research Boulevard
−Removed: 2277 Research Boulevard
−Removed: 8521 Leesburg Pike
−Removed: 11501 Burnet Road - Building 1
−Removed: 11501 Burnet Road - Building 2
−Removed: 11501 Burnet Road - Building 3
−Removed: 11501 Burnet Road - Building 4
−Removed: 11501 Burnet Road - Building 5
−Removed: 11501 Burnet Road - Building 6
−Removed: 11501 Burnet Road - Building 8
−Removed: 11501 Burnet Road - Parking Garage
−Removed: Four Points Centre 3 (11120 Four Points Drive)
−Removed: One Barton Skyway (1501 South MoPac Expressway)
−Removed: Two Barton Skyway (1601 South MoPac Expressway)
−Removed: Three Barton Skyway (1221 South MoPac Expressway)
−Removed: Four Barton Skyway (1301 South MoPac Expressway)
−Removed: Gross Amount Which Carried December 31, 2019
−Removed: Property Name
−Removed: Encumbrances (a)
−Removed: Building & Improvements
−Removed: Net Improvements (Retirements) Since Acquisition
−Removed: Building & Improvements
−Removed: Accumulated Depreciation at December 31, 2019 (c)
−Removed: Year of Construction
−Removed: Year Acquired
−Removed: Depreciable Life
−Removed: Four Points Centre (11305 Four Points Drive)
−Removed: River Place - Building 1 (6500 River Place Boulevard)
−Removed: River Place - Building 2 (6500 River Place Boulevard)
−Removed: River Place - Building 3 (6500 River Place Boulevard)
−Removed: River Place - Building 4 (6500 River Place Boulevard
−Removed: River Place - Building 5 (6500 River Place Boulevard)
−Removed: River Place - Building 6 (6500 River Place Boulevard)
−Removed: River Place - Building 7 (6500 River Place Boulevard)
−Removed: Quarry Lake II (4516 Seton Center Parkway)
−Removed: 10 Foster Avenue
−Removed: 7 Foster Avenue
−Removed: 2 Foster Avenue
−Removed: 4 Foster Avenue
−Removed: 1 Foster Avenue
−Removed: 5 Foster Avenue
−Removed: Main Street - Plaza 1000
−Removed: Main Street - Piazza
−Removed: Main Street - Promenade
−Removed: 920 North King Street
−Removed: 300 Delaware Avenue
−Removed: Excludes the effect of any net interest premium/(discount) and deferred financing costs.
−Removed: Reconciliation of Real Estate:
+Added: 6600 Rockledge Drive Bethesda MD — 37,421 10,036 — 47,457 47,457 16,270 1981 2006 (c)
+Added: 2340 Dulles Corner Boulevard Herndon VA 16,345 65,379 524 16,129 66,119 82,248 23,858 1987 2006 (c)
+Added: 1676 International Drive McLean VA 18,437 97,538 17,656 18,785 114,846 133,631 27,969 1999 2006 (c)
+Added: 8260 Greensboro Drive McLean VA 7,952 33,964 5,313 8,102 39,127 47,229 12,664 1980 2006 (c)
+Added: 8521 Leesburg Pike Vienna VA 4,316 30,885 7,007 4,397 37,811 42,208 12,898 1984 2006 (c)
+Added: 11501 Burnet Road - Building 1 Austin TX 3,755 22,702 12 3,755 22,714 26,469 3,788 1991 2015 (c)
+Added: 11501 Burnet Road - Building 2 Austin TX 2,732 16,305 1,479 2,732 17,784 20,516 3,471 1991 2015 (c)
+Added: 11501 Burnet Road - Building 3 Austin TX 3,688 22,348 10 3,688 22,358 26,046 3,729 1991 2015 (c)
+Added: 11501 Burnet Road - Building 4 Austin TX 2,614 15,740 8 2,614 15,748 18,362 2,628 1991 2015 (c)
+Added: 11501 Burnet Road - Building 5 Austin TX 3,689 22,354 13 3,689 22,367 26,056 3,733 1991 2015 (c)
+Added: 11501 Burnet Road - Building 6 Austin TX 2,676 15,972 14,133 2,676 30,105 32,781 5,446 1991 2015 (c)
+Added: 11501 Burnet Road - Building 8 Austin TX 1,400 7,422 1,523 1,400 8,945 10,345 1,536 1991 2015 (c)
+Added: 11501 Burnet Road - Parking Garage Austin TX — 19,826 6 — 19,832 19,832 4,378 1991 2015 (c)
+Added: Four Points Centre 3 (11120 Four Points Drive) Austin TX 1,140 — 40,330 1,141 40,329 41,470 3,279 2019 2013 (c)
+Added: One Barton Skyway (1501 South MoPac Expressway) Austin TX 10,496 47,670 3,448 10,495 51,119 61,614 2,826 1999 2018 (c)
+Added: Two Barton Skyway (1601 South MoPac Expressway) Austin TX 10,849 53,868 2,820 10,848 56,689 67,537 3,532 2000 2018 (c)
+Added: Three Barton Skyway (1221 South MoPac Expressway) Austin TX 10,374 47,624 304 10,373 47,929 58,302 2,603 2001 2018 (c)
+Added: Four Barton Skyway (1301 South MoPac Expressway) Austin TX 13,301 57,041 2,904 13,300 59,946 73,246 3,162 2001 2018 (c)
+Added: Initial Cost Gross Amount Which Carried December 31, 2020
+Added: Property Name City State Land Building & Improvements Net Improvements (Retirements) Since Acquisition Land Building & Improvements Total (a) Accumulated Depreciation at December 31, 2020 (b)
+Added: Year of Construction Year Acquired Depreciable Life
+Added: Four Points Centre (11305 Four Points Drive) Austin TX 7,800 43,581 3,923 7,800 47,504 55,304 3,024 2008 2018 (c)
+Added: River Place - Building 1 (6500 River Place Boulevard) Austin TX 2,004 17,680 537 2,004 18,217 20,221 1,072 2000 2018 (c)
+Added: River Place - Building 2 (6500 River Place Boulevard) Austin TX 3,137 29,254 618 3,137 29,872 33,009 1,634 2000 2018 (c)
+Added: River Place - Building 3 (6500 River Place Boulevard) Austin TX 3,064 26,705 279 3,064 26,984 30,048 1,429 2000 2018 (c)
+Added: River Place - Building 4 (6500 River Place Boulevard Austin TX 2,273 18,617 1,047 2,273 19,664 21,937 1,345 2000 2018 (c)
+Added: River Place - Building 5 (6500 River Place Boulevard) Austin TX 1,752 14,315 97 1,752 14,412 16,164 768 2001 2018 (c)
+Added: River Place - Building 6 (6500 River Place Boulevard) Austin TX 1,598 12,945 22 1,598 12,967 14,565 690 2001 2018 (c)
+Added: River Place - Building 7 (6500 River Place Boulevard) Austin TX 1,801 16,486 1,094 1,801 17,580 19,381 1,210 2002 2018 (c)
+Added: Quarry Lake II (4516 Seton Center Parkway) Austin TX 3,970 30,546 1,024 3,867 31,673 35,540 1,772 1998 2018 (c)
+Added: 10 Foster Avenue Gibbsboro NJ 244 971 164 244 1,135 1,379 659 1983 1997 (c)
+Added: 7 Foster Avenue Gibbsboro NJ 231 921 31 231 952 1,183 575 1983 1997 (c)
+Added: 2 Foster Avenue Gibbsboro NJ 185 730 11 185 741 926 741 1974 1997 (c)
+Added: 4 Foster Avenue Gibbsboro NJ 183 726 6 183 732 915 732 1974 1997 (c)
+Added: 1 Foster Avenue Gibbsboro NJ 93 364 8 93 372 465 372 1972 1997 (c)
+Added: Avenue Gibbsboro NJ 21 81 2 21 83 104 83 1987 1997 (c)
+Added: 5 Foster Avenue Gibbsboro NJ 9 32 3 9 35 44 35 1968 1997 (c)
+Added: Main Street - Plaza 1000 Voorhees NJ 2,732 10,942 284 2,732 11,226 13,958 11,017 1988 1997 (c)
+Added: Main Street - Piazza Voorhees NJ 696 2,802 3,631 704 6,425 7,129 3,837 1990 1997 (c)
+Added: Main Street - Promenade Voorhees NJ 532 2,052 326 532 2,378 2,910 1,432 1988 1997 (c)
+Added: 920 North King Street Wilmington DE 6,141 21,140 8,059 6,141 29,199 35,340 14,492 1989 2004 (c)
+Added: 300 Delaware Avenue Wilmington DE 6,369 13,739 2,657 6,369 16,396 22,765 9,823 1989 2004 (c)
+Added: $ 366,673 $ 2,494,108 $ 613,328 $ 407,514 $ 3,066,595 $ 3,474,109 $ 896,561
+Added: (a) Reconciliation of Real Estate:
The following table reconciles the real estate investments from January 1, 2018 to December 31, 2020 (in thousands):
+Added: 2020 2019 2018
Balance at beginning of year $ 4,006,459 $ 3,951,719 $ 3,830,824
+Added: Acquisitions 9,722 — 509,654
Capital expenditures and assets placed into service 113,221 145,378 129,274
Dispositions/impairments/placed into redevelopment ( 619,086 ) ( 50,792 ) ( 469,517 )
+Added: Retirements ( 36,207 ) ( 39,846 ) ( 48,516 )
Balance at end of year $ 3,474,109 $ 4,006,459 $ 3,951,719
1 unchanged sentence
The aggregate cost for federal income tax purposes is $ 2.9 billion as of December 31, 2020.
−Removed: Reconciliation of Accumulated Depreciation:
+Added: (b) Reconciliation of Accumulated Depreciation:
The following table reconciles the accumulated depreciation on real estate investments from January 1, 2018 to December 31, 2020 (in thousands):
+Added: 2020 2019 2018
Balance at beginning of year $ 973,318 $ 885,407 $ 913,297
1 unchanged sentence
Dispositions/impairments/placed into redevelopment ( 182,526 ) ( 16,783 ) ( 117,589 )
+Added: Retirements ( 33,053 ) ( 39,437 ) ( 47,514 )
Balance at end of year $ 896,561 $ 973,318 $ 885,407
Per consolidated balance sheet $ 896,561 $ 973,318 $ 885,407
−Removed: Depreciation of the buildings and improvements are calculated over lives ranging from the life of the lease to 55 years .
−Removed: Reflects original construction date.
−Removed: Significant improvements were made to 3000 Market Street in 1988 and The Bulletin Building in 2012.
−Removed: Represent leasehold interests in a land parcels acquired through prepaid 99 -year ground leases.
+Added: (c) Depreciation of the buildings and improvements are calculated over lives ranging from the life of the lease to 55 years.
+Added: (d) Land value represents unamortized prepaid ground lease.
+Added: (e) Reflects original construction date.
+Added: Significant improvements were made to The Bulletin Building in 2012.
+Added: (f) Represent leasehold interests in land parcels acquired through prepaid 99-year ground leases.
Development has not yet commenced on the parcel.
Building and improvements represent costs related to parking operations.
−Removed: Land value represents unamortized prepaid ground lease.
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.