COUSINS PROPERTIES INC 10-K

Item 9A. Controls and Procedures We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Management necessarily applied judgment in assessing the costs and benefits of such controls and procedures, which, by their nature, can provide only reasonable assurance regarding our control objectives. As of the end of the period covered by this annual report, we carried out an evaluation, under the supervision and with the participation of management, including the Chief Executive Officer along with the Chief Financial Officer, of the effectiveness, design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)). Based upon the foregoing, the Chief Executive Officer along with the Chief Financial Officer concluded that our disclosure controls and procedures were effective. In addition, based on such evaluation we have identified no changes in our internal control over financial reporting that occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Report of Management on Internal Control over Financial Reporting Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with GAAP. Internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements. Management, under the supervision of and with the participation of the Chief Executive Officer and the Chief Financial Officer, assessed the effectiveness of our internal control over financial reporting as of December 31, 2021. The framework on which the assessment was based is described in “Internal Control – Integrated Framework” (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, we concluded that we maintained effective internal control over financial reporting as of December 31, 2021. Deloitte & Touche LLP, our independent registered public accounting firm, issued an opinion on the effectiveness of our internal control over financial reporting as of December 31, 2021, which follows this report of management. 40 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and Board of Directors of Cousins Properties Incorporated Opinion on Internal Control over Financial Reporting We have audited the internal control over financial reporting of Cousins Properties Incorporated and subsidiaries (the "Company") as of December 31, 2021, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2021, of the Company and our report dated February 3, 2022, expressed an unqualified opinion on those consolidated financial statements. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Report of Management on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Deloitte & Touche LLP Atlanta, Georgia February 3, 2022 41 Table of Contents PART III Item 10. Directors, Executive Officers and Corporate Governance The information required by Items 401, 405, 406, and 407 of Regulation S-K is presented in Item X in Part I of this report and is included under the captions “Proposal 1 - Election of Directors” and “Delinquent Section 16(a) Reports” in the Proxy Statement relating to the 2022 Annual Meeting of the Registrant’s Stockholders and is incorporated herein by reference. The Company has the Code, which is applicable to its Board of Directors and all of its employees. The Code is publicly available on the “Investor Relations” page of its website site at www.cousins.com. Section 1 of the Code applies to the Company’s senior executive and financial officers and is a “code of ethics” as defined by applicable SEC rules and regulations. If the Company makes any amendments to the Code other than technical, administrative or other non-substantive amendments, or grants any waivers, including implicit waivers, from a provision of the Code to the Company’s senior executive or financial officers, the Company will disclose on its website the nature of the amendment or waiver, its effective date and to whom it applies. Item 11. Executive Compensation The information required by Items 402 and 407 of Regulation S-K is included under the captions “Executive Compensation,” “Director Compensation,” and "Compensation Committee Interlocks and Insider Participation" in the Proxy Statement relating to the 2022 Annual Meeting of the Registrant’s Stockholders and is incorporated herein by reference. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The information under the captions “Beneficial Ownership of Common Stock” and "Equity Compensation Plan Information" in the Proxy Statement relating to the 2022 Annual Meeting of the Registrant’s Stockholders is incorporated herein by reference. Item 13. Certain Relationships and Related Transactions, and Director Independence The information under the caption “Certain Transactions” and “Director Independence” in the Proxy Statement relating to the 2022 Annual Meeting of the Registrant’s Stockholders is incorporated herein by reference. Item 14. Principal Accountant Fees and Services The information under the caption “Summary of Fees to Independent Registered Public Accounting Firm” in the Proxy Statement relating to the 2022 Annual Meeting of the Registrant’s Stockholders has fee information for fiscal years 2021 and 2020 and is incorporated herein by reference. 42 Table of Contents PART IV Item 15. Exhibits and Financial Statement Schedules (a) 1. Financial Statements A. The following consolidated financial statements of the Registrant, together with the applicable report of independent registered public accounting firm, are filed as a part of this report: Page Number Report of Independent Registered Public Accounting Firm (PCAOB ID No. 34) F-2 Consolidated Balance Sheets—December 31, 2021 and 2020 F-5 Consolidated Statements of Operations for the Years Ended December 31, 2021, 2020, and 2019 F-6 Consolidated Statements of Equity for the Years Ended December 31, 2021, 2020, and 2019 F-7 Consolidated Statements of Cash Flows for the Years Ended December 31, 2021, 2020, and 2019 F-8 Notes to Consolidated Financial Statements F-9 2. Financial Statement Schedule The following financial statement schedule for the Registrant is filed as a part of this report: Page Number A. Schedule III—Real Estate and Accumulated Depreciation—December 31, 2021 S-1 through S-4 NOTE: Other schedules are omitted because of the absence of conditions under which they are required or because the required information is given in the financial statements or notes thereto. (b) Exhibits 2.1 Agreement and Plan of Merger, dated April 28, 2016, by and among Parkway Properties, Inc., Parkway Properties LP, Cousins Properties Incorporated and Clinic Sub Inc., filed as Exhibit 2.1 to the Registrant's Current Form on Form 8-K filed on April 29, 2016, and incorporated herein by reference. 2.2 Separation, Distribution and Transition Services Agreement, dated as of October 5, 2016, by and among the Registrant, Cousins Properties LP, Clinic Sub Inc., Parkway Properties, Inc., Parkway Properties LP, Parkway Properties General Partners, Inc., Parkway, Inc. and Parkway Operating Partnership LP., filed as Exhibit 2.1 to the Registrant's Current Form on Form 8-K filed on October 6, 2016, and incorporated herein by reference. 2.3 Tax Matters Agreement, dated as of October 5, 2016, by and among the Registrant, Cousins Properties LP, Clinic Sub Inc., Parkway Properties, Inc., Parkway Properties LP, Parkway Properties General Partners, Inc., Parkway, Inc. and Parkway Operating Partnership LP., filed as Exhibit 2.2 to the Registrant's Current Form on Form 8-K filed on October 6, 2016, and incorporated herein by reference. 2.4 Employee Matters Agreement, dated as of October 5, 2016, by and among the Registrant, Cousins Properties LP, Clinic Sub Inc., Parkway Properties, Inc., Parkway Properties LP, Parkway Properties General Partners, Inc., Parkway, Inc. and Parkway Operating Partnership LP., filed as Exhibit 2.3 to the Registrant's Current Form on Form 8-K filed on October 6, 2016, and incorporated herein by reference. 2.5 Agreement and Plan of Merger, dated March 25, 2019, by and among the Registrant, Murphy Subsidiary Holdings Corporation, and TIER REIT, Inc., filed as Exhibit 2.1 to the Registrant’s Current Report on Form 8-K filed on March 25, 2019, and incorporated herein by reference. 3.1 Restated and Amended Articles of Incorporation of the Registrant, as amended August 9, 1999, filed as Exhibit 3.1 to the Registrant’s Form 10-Q for the quarter ended June 30, 2002, and incorporated herein by reference. 3.1.1 Articles of Amendment to Restated and Amended Articles of Incorporation of the Registrant, as amended July 22, 2003, filed as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed on July 23, 2003, and incorporated herein by reference. 3.1.2 Articles of Amendment to Restated and Amended Articles of Incorporation of the Registrant, as amended December 15, 2004, filed as Exhibit 3(a)(i) to the Registrant’s Form 10-K for the year ended December 31, 2004, and incorporated herein by reference. 3.1.3 Articles of Amendment to Restated and Amended Articles of Incorporation of the Registrant, dated May 4, 2010, filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on May 10, 2010, and incorporated herein by reference. 43 Table of Contents 3.1.4 Articles of Amendment to Restated and Amended Articles of Incorporation of the Registrant, as amended May 9, 2014, filed as Exhibit 3.1.4 to the Registrant’s Form 10-Q for the quarter ended June 30, 2014, and incorporated herein by reference. 3.1.5 Articles of Amendment to Restated and Amended Articles of Incorporation of Cousins, as amended October 6, 2016, filed as Exhibit 3.1 and 3.1.1 to the Registrant's Current Form on Form 8-K filed on October 7, 2016, and incorporated herein by reference. 3.1.6 Articles of Amendment to Restated and Amended Articles of Incorporation of the Registrant, filed as Exhibit 3.1 to the Registrant's Current Report on Form 8-K filed on June 14, 2019, and incorporated herein by reference. 3.1.7 Articles of Amendment to Restated and Amended Articles of Incorporation of the Registrant, filed as Exhibit 3.2 to the Registrant's Current Report on Form 8-K filed on June 14, 2019, and incorporated herein by reference. 3.2 Bylaws of the Registrant, as amended and restated December 4, 2012, filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on December 7, 2012, and incorporated herein by reference. 4.1 Master Purchase Agreement, dated as of April 19, 2017, by and among the Registrant, Cousins Properties LP, and the purchasers of certain unsecured senior notes (the "Master Note Purchase Agreement"), filed as Exhibit 4.1 to the Registrant's 10-Q filed for the quarter ended June 30, 2019, and incorporated herein by reference. 4.2 Cousins Properties Incorporated, Cousins Properties LP, First Supplement to Master Note Purchase Agreement, dated as of June 12, 2019, filed as Exhibit 4.2 to the Registrant’s 10-Q filed for the quarter ended June 30, 2019, and incorporated herein by reference. 4.3 Guaranty Agreement, dated as of April 19, 2017 (as amended, modified, or supplemented from time to time, the "Guaranty Agreement") incorporated by reference to Exhibit A of Exhibit 4.1 above, filed as Exhibit 4.1 above, filed as Exhibit 4.3 to the Registrant's 10-Q filed for the quarter ended June 30, 2019, and incorporated herein by reference. 4.4 Form of Senior Unsecured Notes incorporated by reference to Schedule 1-A and 1-B of Exhibit 4.1 above, filed as Exhibit 4.4 to the Registrant's 10-Q filed for the quarter ended June 30, 2019, and incorporated herein by reference. 4.5 Form of Senior Unsecured Notes incorporated by reference to Schedule 1-A, 1-B, and 1-C of Exhibit 4.2 above, filed as Exhibit 4.5 to the Registrant's 10-Q filed for the quarter ended June 30, 2019, and incorporated herein by reference. 4.6 Description of Registrant's Securities, filed as Exhibit 4.6 to the Registrant's Form 10-K filed for the year ended December 31, 2019. 10(a)(i)* Cousins Properties Incorporated 1999 Incentive Stock Plan, as amended and restated, approved by the Stockholders on May 6, 2008, filed as Annex B to the Registrant’s Proxy Statement dated April 13, 2008, and incorporated herein by reference. 10(a)(ii)* Cousins Properties Incorporated 2005 Restricted Stock Unit Plan, filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated December 9, 2005, and incorporated herein by reference. 10(a)(iii)* Amendment No. 1 to Cousins Properties Incorporated 2005 Restricted Stock Unit Plan, filed as Exhibit 10(a)(iii) to the Registrant’s Form 10-Q for the quarter ended March 31, 2006, and incorporated herein by reference. 10(a)(iv)* Amendment No. 2 to the Cousins Properties Incorporated 2005 Restricted Stock Unit Plan, filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on August 18, 2006, and incorporated herein by reference. 10(a)(v)* Form of Change in Control Severance Agreement, filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on August 31, 2007, and incorporated herein by reference. 10(a)(vi)* Amendment No. 1 to the Cousins Properties Incorporated 1999 Incentive Stock Plan, filed as Exhibit 10(a)(ii) to the Registrant’s Form 10-Q for the quarter ended March 31, 2008, and incorporated herein by reference. 10(a)(vii)* Amendment No. 4 to the Cousins Properties Incorporated 2005 Restricted Stock Unit Plan dated September 8, 2008, filed as Exhibit 10(a)(xiii) to the Registrant’s Form 10-K for the year ended December 31, 2008, and incorporated herein by reference. 44 Table of Contents 10(a)(viii)* Amendment No. 5 to the Cousins Properties Incorporated 2005 Restricted Stock Unit Plan dated February 16, 2009, filed as Exhibit 10(a)(xiv) to the Registrant’s Form 10-K for the year ended December 31, 2008, and incorporated herein by reference. 10(a)(ix)* Form of Amendment Number One to Change in Control Severance Agreement filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated May 12, 2009, and incorporated herein by reference. 10(a)(x)* Amendment Number 6 to the Cousins Properties Incorporated 2005 Restricted Stock Unit Plan filed as Exhibit 10.3 to the Registrant’s Current Report on Form 8-K dated May 12, 2009, and incorporated herein by reference. 10(a)(xi)* Form of Cousins Properties Incorporated Cash Long Term Incentive Award Certificate filed as Exhibit 10.3 to the Registrant’s Current Report on Form 8-K dated May 12, 2009, and incorporated herein by reference. 10(a)(xii)* Cousins Properties Incorporated 2009 Incentive Stock Plan, as approved by the Stockholders on May 12, 2009, filed as Annex B to the Registrant’s Proxy Statement dated April 3, 2009, and incorporated herein by reference. 10(a)(xiii)* Cousins Properties Incorporated Director Non-Incentive Stock Option and Stock Appreciation Right Certificate under the Cousins Properties Incorporated 2009 Incentive Stock Plan, filed as Exhibit 10.2 to the Registrant’s Form 10-Q for the quarter ended June 30, 2009, and incorporated herein by reference. 10(a)(xiv)* Form of New Change in Control Severance Agreement, filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on January 7, 2011, and incorporated herein by reference. 10(a)(xv)* Form of Amendment Number Two to Change in Control Severance Agreement, filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on January 7, 2011, and incorporated herein by reference. 10(a)(xvi)* Cousins Properties Incorporated 2009 Incentive Stock Plan – Form of Key Employee Non-Incentive Stock Option Certificate filed as Exhibit 10(a)(xxvi) to the Registrant’s Form 10-K for the year ended December 31, 2010, and incorporated herein by reference. 10(a)(xvii)* Cousins Properties Incorporated 2009 Incentive Stock Plan – Form of Key Employee Incentive Stock Option Certificate filed as Exhibit 10(a)(xxvii) to the Registrant’s Form 10-K for the year ended December 31, 2010, and incorporated herein by reference. 10(a)(xviii)* Form of Amendment Number One to Change in Control Severance Agreement, filed as Exhibit 10(a)(xxxvi) to the Registrant's Form 10-K for the year ended December 31, 2015, and incorporated herein by reference. 10(a)(xix)* Form of New Change in Control Severance Agreement, filed as Exhibit 10.1 to the Registrant's Current Report on Form 10-Q filed for the quarter ended June 30, 2017, and incorporated herein by reference. 10(a)(xx)* Form of Amendment Number One to Change in Control Severance Agreement, filed as Exhibit 10.2 to the Registrant's Current Report on Form 10-Q filed for the quarter ended June 30, 2017, and incorporated herein by reference. 10(a)(xxi)* Form of Amendment Number Three to Change in Control Severance Agreement, filed as Exhibit 10.2 to the Registrant's Current Report on Form 10-Q filed for the quarter ended June 30, 2017, and incorporated herein by reference. 10(a)(xxii)* Cousins Properties Incorporated 2005 Restricted Stock Unit Plan — Form of Restricted Stock Unit Certificate for 2017-2020 Service Period, filed as Exhibit 10(a)(xxx) to the Registrant's Form 10-K for the year ended December 31, 2017, and incorporated herein by reference. 10(a)(xxiii)* Cousins Properties Incorporated 2009 Incentive Stock Plan – Form of Stock Grant Certificate, filed as Exhibit 10(a)(xxxi) to the Registrant's Form 10-K for the year ended December 31, 2017, and incorporated herein by reference. 10(a)(xxiv)* Cousins Properties Incorporated 2005 Restricted Stock Unit Plan — Form of Restricted Stock Unit Certificate for 2018-2020 Performance Period, filed as Exhibit 10(a)(xxxii) to the Registrant's Form 10-K for the year ended December 31, 2017, and incorporated herein by reference. 10(a)(xxv)* Cousins Properties Incorporated 2005 Restricted Stock Cousins Properties Incorporated 2005 Restricted Stock Unit Plan — Form of Restricted Stock Unit Certificate for 2017-2020 Service Period, filed as Exhibit 10(a)(xxxiii) to the Registrant's Form 10-K for the year ended December 31, 2017, and incorporated herein by reference. 45 Table of Contents 10(a)(xxvi)* Cousins Properties Incorporated 2005 Restricted Stock Unit Plan — Form of Restricted Stock Unit Certificate for 2019-2021 Performance Period, filed as Exhibit 10(a)(xxxiv) to the Registrant's Form 10-K for the year ended December 31, 2018, and incorporated herein by reference. 10(a)(xxvii)* Cousins Properties Incorporated 2009 Incentive Stock Plan — Form of Stock Grant Certificate, filed as Exhibit 10(a)(xxxv) to the Registrant's Form 10-K for the year ended December 31, 2018, and incorporated herein by reference. 10(a)(xxviii)* Cousins Properties Incorporated 2005 Restricted Stock Unit Plan — Form of Restricted Stock Unit Certificate for 2019-2021 Service Period, filed as Exhibit 10(a)(xxxvi) to the Registrant's Form 10-K for the year ended December 31, 2018, and incorporated herein by reference. 10(a)(xxix)* Cousins Properties Incorporated 2019 Omnibus Incentive Stock Plan, filed as Exhibit 10.1 to the Registrant's Form 10-Q filed for the quarter ended March 31, 2019, and incorporated herein by reference. 10(a)(xxx)* Cousins Properties Incorporated 2019 Omnibus Incentive Stock Plan — Restricted Stock Unit Award Agreement, filed as Exhibit 10(a)(xxxvii) to the Registrant's Annual Report on Form 10-K filed for the year ended December 31, 2019, and incorporated herein by reference. 10(a)(xxx i) * Cousins Properties Incorporated 2019 Omnibus Incentive Stock Plan — Director Stock Grant Certificate, filed as Exhibit 10(a)(xl) to the Registrant's Form 10-Q filed for the quarter ended March 31, 2020 and incorporated herein by reference. 10(a)(xxxii) * Cousins Properties Incorporated 2019 Omnibus Incentive Stock Plan — Stock Grant Certificate , filed as exhibit 10(a)(xxxi i) to the Registrant's Form 10-K filed for the year ended December 31, 2021. 10(a)(xxxiii)* Cousins Properties Incorporated 2019 Omnibus Incentive Stock Plan — Restricted Stock Unit Certificate , filed as exhibit 10(a)(xxxiii) to the R egistrant's Form 10-K filed fo r the year ended December 31, 2021. 10(a)(xxxiv)* Cousins Properties Incorporated 2019 Omnibus Incentive Stock Plan — Director Stock Grant Certificate , filed as exhibit 10(a)(xxxi v ) to the Registrant's Form 10-K filed for the year ended December 31, 2021. 10(a)(xxxv)* Cousins Properties Incorporated 2021 Employee Stock Purchase Plan, filed as exhibit 10(a)(xxxv) to the Registrant's Form 8-K filed on November 1, 2021 and incorporated herein by reference. 10(a)(xxxvi)*† Amendment Number One to the Cousins Properties Incorporated 2019 Omnibus Incentive Stock Plan. 10(b) Form of Indemnification Agreement, filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated June 18, 2007, and incorporated herein by reference. 10(c) Agreement of Limited Partnership of Cousins Properties LP., filed as Exhibit 10.1 to the Registrant's Current Form on Form 8-K filed on October 7, 2016, and incorporated herein by reference. 10(d) Retirement Agreement and General Release for Lawrence L. Gellerstedt, Executive Chairman of the Board, filed as exhibit 10(b) to the Registrant's Form 10-Q filed for the quarter ended March 31, 2020, and incorporated herein by reference. 10(e) Amended and Restated Term Loan Agreement, dated June 28, 2021, by and among the Registrant, Cousins Properties LP, J.P. Morgan Chase Bank, N.A., Bank of America, N.A., PNC Bank, National Association, Truist Bank, and the other parties thereto, filed as Exhibit 10.1 to the Registrant's Form 10-Q filed for the quarter ended June 30, 2021, and incorporated herein by reference. 10(f) Equity Distribution Agreement, dated August 3, 2021, between Cousins Properties Incorporated, Cousin Properties LP and Morgan Stanley & Co. LLC, BofA Securities, Inc., J.P. Morgan Securities LLC, TD Securities (USA) LLC, Truist Securities, Inc. and Wells Fargo Securities, LLC, as managers, Morgan Stanley & Co. LLC, Bank of America, N.A., JPMorgan Chase Bank, National Association, The Toronto-Dominion Bank, Truist Bank and Wells Fargo Bank, National Association, as forward purchasers, and Morgan Stanley & Co. LLC, BofA Securities, Inc., J.P. Morgan Securities LLC, TD Securities (USA) LLC, Truist Securities, Inc. and Wells Fargo Securities, LLC, as forward sellers; filed as Exhibit 1.1 to the Registrant's Current Form 8-K filed on August 3, 2021, and incorporated herein by reference. 21† Subsidiaries of the Registrant. 23† Consent of Independent Registered Public Accounting Firm. 31.1† Certification of the Chief Executive Officer Pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 46 Table of Contents 31.2† Certification of the Chief Financial Officer Pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1† Certification of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2† Certification of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 101† The following financial information for the Registrant, formatted in XBRL (Extensible Business Reporting Language): (i) the consolidated balance sheets, (ii) the consolidated statements of operations, (iii) the consolidated statements of equity, (iv) the consolidated statements of cash flows, and (v) the notes to consolidated financial statements. 104† Cover Page Interactive Data File. * Indicates a management contract or compensatory plan or arrangement. † Filed herewith. 47 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Cousins Properties Incorporated (Registrant) Dated: February 3, 2022 BY: /s/ Gregg D. Adzema Gregg D. Adzema Executive Vice President and Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer) 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 date indicated. Signature Capacity Date /s/ M. Colin Connolly Chief Executive Officer, President, and Director February 3, 2022 M. Colin Connolly (Principal Executive Officer) /s/ Gregg D. Adzema Executive Vice President and Chief Financial Officer February 3, 2022 Gregg D. Adzema (Principal Financial Officer) /s/ Jeffrey D. Symes Senior Vice President and Chief Accounting Officer February 3, 2022 Jeffrey D. Symes (Principal Accounting Officer) /s/ Charles T. Cannada Director February 3, 2022 Charles T. Cannada /s/ Robert M. Chapman Chairman of the Board and Director February 3, 2022 Robert M. Chapman /s/ Scott W. Fordham Director February 3, 2022 Scott W. Fordham /s/ Lillian C. Giornelli Director February 3, 2022 Lillian C. Giornelli /s/ R. Kent Griffin, Jr. Director February 3, 2022 R. Kent Griffin, Jr. /s/ Donna W. Hyland Director February 3, 2022 Donna W. Hyland /s/ Dionne Nelson Director February 3, 2022 Dionne Nelson /s/ R. Dary Stone Director February 3, 2022 R. Dary Stone 48 Table of Contents INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Cousins Properties Incorporated Page Report of Independent Registered Public Accounting Firm (PCAOB ID No. 34 ) F- 2 Consolidated Balance Sheets—December 31, 2021 and 2020 F- 4 Consolidated Statements of Operations for the Years Ended December 31, 2021, 2020, and 2019 F- 5 Consolidated Statements of Equity for the Years Ended December 31, 2021, 2020, and 2019 F- 6 Consolidated Statements of Cash Flows for the Years Ended December 31, 2021, 2020, and 2019 F- 7 Notes to Consolidated Financial Statements F- 8 F-1 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and the Board of Directors of Cousins Properties Incorporated Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Cousins Properties Incorporated and subsidiaries (the "Company") as of December 31, 2021 and 2020, the related consolidated statements of operations, equity, and cash flows for each of the three years in the period ended December 31, 2021, and the related notes and the financial statement schedule listed in the Index at Item 15 (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 3, 2022, expressed an unqualified opinion on the Company's internal control over financial reporting. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which they relate. Revenue Recognition - Refer to Note 2 to the financial statements Critical Audit Matter Description Rental property revenues are derived from operating leases to tenants. The Company recognizes fixed lease payments, which excludes certain rental property revenue such as percentage rent and revenue related to the recovery of certain operating expenses from tenants, on a straight-line basis over the term of the lease. The timing and amount of rental revenue recognition is largely dependent on whether the Company is the owner of tenant improvements at the leased property. In determining whether the Company or the tenant owns such tenant improvements, management of the Company considers a number of factors, including, among other things: (1) whether the tenant is obligated by the terms of the lease agreement to construct or install the leasehold improvements; (2) whether the landlord can require the lessee to make specified improvements or otherwise enforce its economic rights to those assets; (3) whether the tenant is permitted to alter or remove the leasehold improvements without the landlord’s consent or without compensating the landlord for any lost utility or diminution in fair value; (4) whether the tenant is required to provide the landlord with documentation supporting the cost of tenant improvements prior to reimbursement by the landlord; (5) whether the Company is obligated to fund cost overruns for the construction of leasehold improvements; (6) whether the leasehold improvements are unique to the tenant or could F-2 Table of Contents reasonably be used by other parties; and (7) whether the economic life of the leasehold improvements is such that a significant residual value of the assets is expected to accrue to the benefit of the landlord at the end of the lease terms. The determination of whether the Company or its tenant owns the tenant improvements and the timing and amount of revenue recognition requires the exercise of significant judgment by management based on the facts and circumstances of the specific lease arrangement and is not based on any one factor. Auditing management’s conclusions with respect to these matters often is complex and requires subjective judgment. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to management’s determination of the owner of the tenant improvements and the related impact on the timing and amount of revenue recognition, included the following, among others: • We tested the effectiveness of controls over revenue recognition, including the determination of the owner of tenant improvements and the timing and amounts of rental revenues to be recognized over the term of the related lease. • We selected a sample of lease agreements and performed the following to evaluate the appropriateness of management’s conclusions regarding the owner of the tenant improvements and the timing and amount of revenue recognition: – Evaluated the reasonableness and consistency of the factors considered by management to determine the owner of the tenant improvements and compared such factors to the terms in the lease agreement or other supporting documents. – Tested tenant improvement costs (including the amounts funded by the Company or the tenant) by reconciling the amounts recorded by the Company to invoices or other supporting documents and evaluated whether the costs were consistent with the terms of the lease agreement and the Company’s ownership determination. – Tested the timing and amounts recognized as rental property revenues, including any amortization of deferred revenue or lease incentives, by independently calculating such rental revenue amounts to be recognized and comparing it to the amounts recorded by the Company. /s/ Deloitte & Touche LLP Atlanta, Georgia February 3, 2022 We have served as the Company's auditor since 2002. F-3 Table of Contents COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands, except share and per share amounts) December 31, 2021 2020 Assets: Real estate assets: Operating properties, net of accumulated depreciation of $ 874,988 and $ 803,073 in 2021 and 2020, respectively $ 6,506,910 $ 6,232,546 Projects under development 174,803 57,389 Land 157,681 162,406 6,839,394 6,452,341 Real estate assets and other assets held for sale, net — 125,746 Cash and cash equivalents 8,937 4,290 Restricted cash 1,231 1,848 Accounts receivable 12,553 20,248 Deferred rents receivable 154,866 138,341 Investment in unconsolidated joint ventures 77,811 125,481 Intangible assets, net 168,553 189,164 Other assets 48,689 49,939 Total assets $ 7,312,034 $ 7,107,398 Liabilities: Notes payable $ 2,237,509 $ 2,162,719 Accounts payable and accrued expenses 224,523 186,267 Deferred income 74,515 62,319 Intangible liabilities, net 63,223 69,846 Other liabilities 111,864 118,103 Liabilities of real estate assets held for sale, net — 12,606 Total liabilities 2,711,634 2,611,860 Commitments and contingencies Equity: Stockholders' investment: Common stock, $ 1 par value per share, 300,000,000 shares authorized, 151,272,969 and 151,149,289 shares issued and outstanding in 2021 and 2020, respectively 151,273 151,149 Additional paid-in capital 5,549,308 5,542,762 Treasury stock at cost, 2,584,933 shares in 2021 and 2020 ( 148,473 ) ( 148,473 ) Distributions in excess of cumulative net income ( 985,338 ) ( 1,078,304 ) Total stockholders' investment 4,566,770 4,467,134 Nonredeemable noncontrolling interests 33,630 28,404 Total equity 4,600,400 4,495,538 Total liabilities and equity $ 7,312,034 $ 7,107,398 See notes to consolidated financial statements. F-4 Table of Contents COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts) Year Ended December 31, 2021 2020 2019 Revenues: Rental property revenues $ 739,063 $ 721,883 $ 628,751 Fee income 15,559 18,226 28,518 Other 451 231 246 755,073 740,340 657,515 Expenses: Rental property operating expenses 259,461 250,850 222,146 Reimbursed expenses 2,476 1,580 4,004 General and administrative expenses 29,321 27,034 37,007 Interest expense 67,027 60,605 53,963 Impairment — 14,829 — Depreciation and amortization 288,092 288,648 257,149 Transaction costs — 428 52,881 Other 2,131 2,091 1,109 648,508 646,065 628,259 Income from unconsolidated joint ventures 6,801 7,947 12,666 Gain on sales of investments in unconsolidated joint ventures 13,083 45,767 — Gain on investment property transactions 152,547 90,125 110,761 Net income 278,996 238,114 152,683 Net income attributable to noncontrolling interests ( 410 ) ( 836 ) ( 2,265 ) Net income available to common stockholders $ 278,586 $ 237,278 $ 150,418 Net income per common share — basic and diluted $ 1.87 $ 1.60 $ 1.17 Weighted average shares — basic 148,666 148,277 128,060 Weighted average shares — diluted 148,891 148,636 129,831 Dividends declared per common share $ 1.24 $ 1.20 $ 1.16 See notes to consolidated financial statements. F-5 Table of Contents COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EQUITY (In thousands, except per share data) Preferred Stock Common Stock Additional Paid-In Capital Treasury Stock Distributions in Excess of Cumulative Net Income Stockholders’ Investment Nonredeemable Noncontrolling Interests Total Equity Balance December 31, 2018 $ 1,717 $ 107,681 $ 3,934,385 $ ( 148,473 ) $ ( 1,129,445 ) $ 2,765,865 $ 55,291 $ 2,821,156 Net income — — — — 150,418 150,418 2,265 152,683 Common stock issued in merger — 41,576 1,556,613 — — 1,598,189 — 1,598,189 Common stock issued pursuant to stock based compensation — 91 416 — — 507 — 507 Amortization of stock based compensation, net of forfeitures — ( 1 ) 2,469 — — 2,468 — 2,468 Nonredeemable noncontrolling interests acquired in merger — — — — — — 5,329 5,329 Contributions from nonredeemable noncontrolling interests — — — — — — 8,087 8,087 Distributions to nonredeemable noncontrolling interests — — — — — — ( 2,411 ) ( 2,411 ) Common dividends ($ 1.16 per share) — — — — ( 158,173 ) ( 158,173 ) — ( 158,173 ) Balance December 31, 2019 1,717 149,347 5,493,883 ( 148,473 ) ( 1,137,200 ) 4,359,274 68,561 4,427,835 Net income — — — — 237,278 237,278 836 238,114 Common stock issued pursuant to stock based compensation — 90 ( 397 ) — — ( 307 ) — ( 307 ) Common stock issued pursuant to unitholder redemption ( 1,717 ) 1,719 45,032 — — 45,034 ( 45,034 ) — Amortization of stock based compensation, net of forfeitures — ( 7 ) 4,244 — — 4,237 — 4,237 Contributions from nonredeemable noncontrolling interests — — — — — — 5,197 5,197 Distributions to nonredeemable noncontrolling interest — — — — — — ( 1,156 ) ( 1,156 ) Common dividends ($ 1.20 per share) — — — — ( 178,382 ) ( 178,382 ) — ( 178,382 ) Balance December 31, 2020 — 151,149 5,542,762 ( 148,473 ) ( 1,078,304 ) 4,467,134 28,404 4,495,538 Net income — — — — 278,586 278,586 410 278,996 Common stock issued pursuant to stock based compensation — 126 426 — — 552 — 552 Amortization of stock based compensation, net of forfeitures — ( 2 ) 6,120 — — 6,118 — 6,118 Contributions from nonredeemable noncontrolling interests — — — — — — 6,154 7,135 Distributions to nonredeemable noncontrolling interests — — — — — — ( 1,338 ) ( 2,319 ) Common dividends ($ 1.24 per share) — — — — ( 185,620 ) ( 185,620 ) — ( 185,620 ) Balance December 31, 2021 $ — $ 151,273 $ 5,549,308 $ ( 148,473 ) $ ( 985,338 ) $ 4,566,770 $ 33,630 $ 4,600,400 See notes to consolidated financial statements. F-6 Table of Contents COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) Year Ended December 31, 2021 2020 2019 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 278,996 $ 238,114 $ 152,683 Adjustments to reconcile net income to net cash provided by operating activities: Gain on sales of investment in unconsolidated joint ventures ( 13,083 ) ( 45,767 ) — Gain on investment property transactions ( 152,547 ) ( 90,125 ) ( 110,761 ) Impairment — 14,829 — Depreciation and amortization 288,092 288,648 257,149 Amortization and write-off of deferred financing costs and premium on notes payable ( 437 ) ( 888 ) 1,500 Equity-classified stock-based compensation expense, net of forfeitures 7,459 5,298 3,830 Effect of non-cash adjustments to rental revenues ( 39,473 ) ( 52,593 ) ( 44,839 ) Income from unconsolidated joint ventures ( 6,801 ) ( 7,947 ) ( 12,666 ) Operating distributions from unconsolidated joint ventures 11,542 9,303 11,792 Changes in other operating assets and liabilities: Change in receivables and other assets, net 5,500 ( 2,439 ) ( 10,079 ) Change in operating liabilities, net 10,230 ( 5,345 ) 54,568 Net cash provided by operating activities 389,478 351,088 303,177 CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from investment property sales, net 555,333 435,833 62,667 Proceeds from sale of interest in unconsolidated joint ventures, net 67,066 53,601 — Property acquisition, development, and tenant asset expenditures ( 787,810 ) ( 619,602 ) ( 482,633 ) Return of capital distributions from unconsolidated joint venture 39,422 — — Cash and restricted cash acquired in merger — — 85,989 Contributions to unconsolidated joint ventures ( 65,077 ) ( 4,285 ) ( 23,361 ) Distributions from unconsolidated joint ventures — 2,151 10 Change in notes receivable and other assets — ( 161 ) ( 96 ) Net cash used in investing activities ( 191,066 ) ( 132,463 ) ( 357,424 ) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from credit facility 855,500 575,500 1,212,000 Repayment of credit facility ( 859,400 ) ( 594,600 ) ( 960,500 ) Repayment of notes payable ( 109,469 ) ( 38,700 ) ( 691,179 ) Issuance of unsecured senior notes — — 650,000 Payment of deferred financing costs ( 2,989 ) ( 73 ) ( 2,868 ) Contributions from noncontrolling interests 6,154 5,197 8,087 Distributions to nonredeemable noncontrolling interests ( 1,338 ) ( 1,156 ) ( 2,411 ) Common dividends paid ( 182,840 ) ( 176,263 ) ( 142,941 ) Issuance of term loan 350,000 — — Repayment of term loan ( 250,000 ) — — Other — — ( 1,028 ) Net cash provided by (used in) financing activities ( 194,382 ) ( 230,095 ) 69,160 NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH 4,030 ( 11,470 ) 14,913 CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT BEGINNING OF PERIOD 6,138 17,608 2,695 CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT END OF PERIOD $ 10,168 $ 6,138 $ 17,608 See notes to consolidated financial statements. F-7 Table of Contents COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Description of Business: Cousins Properties Incorporated (“Cousins”), a Georgia corporation, is a self-administered and self-managed real estate investment trust (“REIT”). Cousins conducts substantially all of its business through Cousins Properties, LP ("CPLP"). Cousins owns in excess of 99 % of CPLP and consolidates CPLP. CPLP wholly owns Cousins TRS Services LLC ("CTRS") a taxable entity which owns and manages its own real estate portfolio and performs certain real estate related services for other parties. Cousins, CPLP, CTRS, and their subsidiaries (collectively, the “Company”) develop, acquire, lease, manage, and own primarily Class A office properties and opportunistic mixed-use developments in the Sun Belt markets of the United States with a focus on Atlanta, Austin, Charlotte, Phoenix, Tampa, Dallas, and Nashville. Cousins has elected to be taxed as a REIT and intends to, among other things, distribute at least 100 % of its net taxable income to stockholders, thereby eliminating any liability for federal income taxes under current law. Therefore, the results included herein do not include a federal income tax provision for Cousins. As of December 31, 2021, the Company’s portfolio of real estate assets consisted of interests in 18.3 million square feet of office space and 620,000 square feet of other space. Basis of Presentation: The consolidated financial statements include the accounts of the Company and its consolidated partnerships and wholly-owned subsidiaries. Intercompany transactions and balances have been eliminated in consolidation. The Company presents its financial statements in accordance with accounting principles generally accepted in the United States (“GAAP”) as outlined in the Financial Accounting Standard Board’s Accounting Standards Codification (the “Codification” or “ASC”). The Codification is the single source of authoritative accounting principles applied by nongovernmental entities in the preparation of financial statements in conformity with GAAP. For the three years ended December 31, 2021, there were no items of other comprehensive income. Therefore, the Company did not present comprehensive income. The Company evaluates all partnerships, joint ventures, and other arrangements with variable interests to determine if the entity or arrangement qualifies as a variable interest entity (“VIE”), as defined in the Codification. If the entity or arrangement qualifies as a VIE and the Company is determined to be the primary beneficiary, the Company is required to consolidate the assets, liabilities, and results of operations of the VIE. In 2020, the Company transferred the right to purchase a building to a special purpose entity to facilitate a potential reverse Section 1031 exchange under the Internal Revenue Code of 1986, as amended (the "Code"), and the special purpose entity purchased the building and retained the assets acquired therefrom. To realize the tax deferral available under Section 1031 exchange, the Company must identify the like-kind property to be disposed of within 45 days of the acquisition date and complete the transfer of the title to the to-be-exchanged building within 180 days of the acquisition date. We concluded that Cousins had a controlling financial interest and was, therefore, the primary beneficiary of the venture. The Company consolidated this VIE entity. As of December 31, 2020, this VIE had total assets of $ 210.2 million and total liabilities of $ 209.7 million. The liabilities of this VIE eliminate in our consolidated balance sheet. As of December 31, 2021, the Company did not have any partnerships, joint ventures, or other arrangements with variable interests that qualified as a VIE. 2. SIGNIFICANT ACCOUNTING POLICIES Real Estate Assets Cost Capitalization: Costs related to planning, developing, leasing, and constructing a property, including costs of development personnel working directly on projects under development, are capitalized. In addition, the Company capitalizes interest to qualifying assets under development based on average accumulated expenditures outstanding during the period. In capitalizing interest to qualifying assets, the Company first uses the interest incurred on specific project debt, if any, and next uses the Company’s weighted average interest rate for non-project specific debt. The Company also capitalizes interest to investments accounted for under the equity method when the investee has property under development with a carrying value in excess of the investee’s borrowings. To the extent debt exists within an unconsolidated joint venture during the construction period, the venture capitalizes interest on that venture-specific debt. The Company capitalizes interest, real estate taxes, and certain operating expenses on the unoccupied portion of recently completed development properties until the date a project is substantially complete and held for occupancy, which is the earlier of (1) the date on which the project achieves 90 % economic occupancy or (2) one year from cessation of major construction activity. F-8 Table of Contents Impairment: We review our real estate assets on a property-by-property basis for impairment. This review includes our operating properties, properties under development, and land holdings. The first step in this process is to determine whether an asset is considered to be held and used or held for sale, in accordance with accounting guidance. In order to be considered a real estate asset held for sale, we must, among other things, have the authority to commit to a plan to sell the asset in its current condition, have commenced the plan to sell the asset, and have determined that it is probable that the asset will sell within one year. If we determine that an asset is held for sale, we record an impairment loss if the fair value less costs to sell is less than the carrying amount. All real estate assets not meeting the held for sale criteria are considered to be held and used. In the impairment analysis for assets held and used, we must determine whether there are indicators of impairment. For operating properties, these indicators could include a decline in a property’s leasing percentage, a current period operating loss or negative cash flows combined with a history of losses at the property, a decline in lease rates for that property or others in the property’s market, a significant change in the market value of the property, or an adverse change in the financial condition of significant tenants. For projects under development, indicators could include material budget overruns, significant delays in construction, occupancy, or stabilization schedule, regulatory changes or economic trends that have a significant impact on the market, or an adverse change in the financial condition of significant future tenants. For land holdings, indicators could include an overall decline in the market value of land in the region, a decline in development activity for the intended use of the land, or other adverse economic and market conditions. Acquisition of Real Estate Assets: The Company evaluates all real estate acquisitions to determine if the transactions qualify as an acquisition of assets or of a business. If the Company determines that substantially all of the fair value is concentrated in a single identifiable asset or group of similar assets, the Company will account for the acquisition as an acquisition of assets and not a business. If the Company determines that there is no single or group of assets that make up substantially all of the fair value of assets acquired, the Company must determine whether the acquired set of assets includes an input and substantial processes which create an output. Based on the facts of the transactions and guidance in ASC 805, if the Company determines that an input and substantial processes that create an output are present, the Company will account for the acquisition as an acquisition of a business. For acquisitions that are accounted for as an acquisition of an asset, the Company records the acquired tangible and intangible assets and assumed liabilities based on each asset and liability's relative fair value at the acquisition date to the total purchase price plus capitalized acquisition costs. For acquisitions that are accounted for as an acquisition of a business, the Company records the acquired tangible and intangible assets and assumed liabilities at fair value at the acquisition date. The acquired assets and assumed liabilities for an operating property acquisition generally include but are not limited to: land, buildings and improvements, and identified tangible and intangible assets and liabilities associated with in-place leases, including leasing costs, value of above-market and below-market tenant leases, value of above-market and below-market ground leases, acquired in-place lease values, and tenant relationships, if any. The fair value of land is derived from comparable sales of land within the same submarket and/or region. The fair value of buildings and improvements, tenant improvements, and leasing costs are based upon current market replacement costs and other relevant market rate information. The fair value of the above-market or below-market component of an acquired lease is based upon the present value (calculated using a market discount rate) of the difference between (1) the contractual rents to be paid pursuant to the lease over its remaining term and (2) management’s estimate of the rents that would be paid using fair market rental rates and rent escalations at the date of acquisition over the remaining term of the lease. The amounts recorded for above-market and below-market ground leases are included in intangible liabilities and intangible assets, respectively, and are amortized on a straight-line basis into rental property revenues over the remaining terms of the applicable leases. The fair value of acquired in-place leases is derived based on management’s assessment of lost revenue and costs incurred for the period required to lease the “assumed vacant” property to the occupancy level when purchased. The amount recorded for acquired in-place leases is included in intangible assets and amortized as an increase to depreciation and amortization expense over the remaining term of the applicable leases. Depreciation and Amortization: Real estate assets are stated at depreciated cost less impairment, if any. Buildings are depreciated over their estimated useful lives, which range generally from 30 to 42 years. The life of a particular building depends upon a number of factors including whether the building was developed or acquired and the condition of the building upon acquisition. Furniture, fixtures, and equipment are depreciated over their estimated useful lives of three to five years . Tenant improvements, leasing costs, and leasehold improvements are amortized over the term of the applicable leases or the estimated useful life of the assets, whichever is shorter. The Company accelerates the depreciation of tenant assets if it estimates that the lease term will end prior to the termination date. This acceleration may occur if a tenant files for F-9 Table of Contents bankruptcy, vacates its premises, or defaults in another manner on its lease. Deferred expenses are amortized over the period of estimated benefit. The Company uses the straight-line method for all depreciation and amortization. Investment in Joint Ventures For joint ventures that the Company does not control, but over which it exercises significant influence, the Company uses the equity method of accounting. The Company's judgment with regard to its level of influence or control of an entity involves consideration of various factors including the form of its ownership interest; its representation in the entity's governance; its ability to participate in policy-making decisions; and the rights of other investors to participate in the decision-making process, to replace the Company as manager, and/or to liquidate the venture. These ventures are recorded at cost and adjusted for equity in earnings (losses) and cash contributions and distributions. Any difference between the carrying amount of these investments on the Company’s consolidated balance sheet and the underlying equity in net assets on the joint venture’s balance sheet is adjusted as the related underlying assets are depreciated, amortized, or sold. The Company generally allocates income and loss from an unconsolidated joint venture based on the venture's distribution priorities, which may be different from its stated ownership percentage. The Company evaluates the recoverability of its investment in unconsolidated joint ventures in accordance with accounting standards for equity investments by first reviewing each investment for any indicators of impairment. If indicators are present, the Company estimates the fair value of the investment. If the carrying value of the investment is greater than the estimated fair value, management makes an assessment of whether the impairment is “temporary” or “other-than-temporary.” In making this assessment, management considers the following: (1) the length of time and the extent to which fair value has been less than cost, (2) the financial condition and near-term prospects of the entity, and (3) the Company’s intent and ability to retain its interest long enough for a recovery in market value. If management concludes that the impairment is "other than temporary," the Company reduces the investment to its estimated fair value. Noncontrolling Interest The Company consolidates CPLP and certain joint ventures in which it owns a controlling interest. In cases where the entity’s documents do not contain a required redemption clause, the Company records the partner’s share of the entity in the equity section of the balance sheets in nonredeemable noncontrolling interests. In cases where the entity’s documents contain a provision requiring the Company to purchase the partner’s share of the venture at a certain value upon demand or at a future date, if any, the Company records the partner’s share of the entity in redeemable noncontrolling interests on the balance sheets. The outside partners' interests in CPLP are redeemable upon demand into cash or shares of common stock of the Company at the Company's sole discretion. Therefore, noncontrolling interests associated with CPLP are considered nonredeemable noncontrolling interests. The noncontrolling partners' share of all consolidated entities' income is reflected in net income attributable to noncontrolling interest on the statements of operations. Revenue Recognition Rental Property Revenues: The Company recognizes contractual revenues from leases on a straight-line basis over the term of the respective lease. If we determine the improvements are our assets, we capitalize the cost of the improvements and recognize depreciation expense associated with such improvements over the shorter of the estimated useful life or the term of the lease. If the improvements are tenant assets, we defer the cost of improvements funded by us as a lease incentive asset and amortize it as a reduction of rental revenue over the term of the lease. Our determination of whether improvements are our assets or tenant assets also affects when we commence revenue recognition in connection with a lease. The Company records deferred revenue for the portion of company owned tenant improvements funded or reimbursed by tenants and amortizes this amount on a straight-line basis into rental income over the term of the related lease. As of December 31, 2021 and 2020, the Company had unamortized deferred income related to tenant funded tenant improvements of $ 30.2 million and $ 31.6 million, respectively, included in deferred income on the consolidated balance sheets. Certain leases also provide for percentage rents based upon the level of sales achieved by the lessee. Percentage rents are recognized once the specified sales target is achieved. In addition, leases typically provide for reimbursement of the tenants' share of real estate taxes, insurance, and other operating expenses to the Company. Operating expense reimbursements are recognized as the related expenses are incurred. During 2021, 2020, and 2019, the Company recognized $ 155.5 million, $ 142.5 million, and $ 122.4 million, respectively, in revenues from tenants related to operating expense reimbursements. The Company makes valuation adjustments to all tenant-related accounts receivable based upon its estimate of the likelihood of collectibility of amounts due from the tenant. The amount of any valuation adjustment is based on the tenant’s credit and business risk, history of payment, and other factors considered by management. F-10 Table of Contents In limited circumstances to date, the Company has entered into lease amendments with certain tenants, a majority of which are small retail operators who have experienced disruptions in their business as a result of the COVID-19 pandemic. Some of these agreements forgive rents and extend the lease term for the equivalent number of months at the end of the original lease and others provide for forgiveness without extension. Rent forgiveness, with or without extensions, is accounted for as lease modifications, and the Company recognizes the effects over time through straight-line rent over the lease term. Other agreements provide for payment deferrals without extensions. The Company accounts for these deferral agreements as lease modifications and has included these deferred payments in deferred rents receivable on the accompanying consolidated balance sheets. Fee Income: The Company recognizes development, management, and leasing fees as it satisfies the related performance obligations under the respective contracts. The Company recognizes development and leasing fees received from investments in unconsolidated joint ventures and related salaries and other direct costs incurred by the Company as income and expense based on the percentage of the joint venture which the Company does not own. Correspondingly, the Company adjusts its investment in unconsolidated joint ventures when fees are paid to the Company by a joint venture in which the Company has an ownership interest. Gain on Investment Property Transactions: The Company recognizes a gain on the sale of investment property at the time the buyer obtains control of the investment property. If the Company maintains any continuing involvement with the investment property, that continuing involvement is considered to be one or more additional performance obligations and additional gains or losses will be recognized as these performance obligations are satisfied. When the Company gains control of a previously unconsolidated investment accounted for under the equity method of accounting, it records a gain for the difference between the carrying value of its equity method investment and the fair value of that investment on the date control is gained. Income Taxes The Company has elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”). To qualify as a REIT, the Company must distribute annually at least 90% of its adjusted taxable income, as defined in the Code, to its stockholders and satisfy certain other organizational and operating requirements. It is management’s current intention to adhere to these requirements and maintain the Company's REIT status. As a REIT, the Company generally will not be subject to federal income tax at the corporate level on the taxable income it distributes to its stockholders. If the Company fails to qualify as a REIT in any taxable year, it will be subject to federal income taxes at regular corporate rates and may not be able to qualify as a REIT for four subsequent taxable years. The Company may be subject to certain state and local taxes on its income and property, and to federal income taxes on its undistributed taxable income. CTRS is a C-Corporation for federal income tax purposes and uses the liability method for accounting for income taxes. Tax return positions are recognized in the financial statements when they are “more-likely-than-not” to be sustained upon examination by the taxing authority. Deferred income tax assets and liabilities result from temporary differences. Temporary differences are differences between the tax bases of assets and liabilities and their reported amounts in the financial statements that will result in taxable or deductible amounts in future periods. A valuation allowance may be placed on deferred income tax assets, if it is determined that it is more likely than not that a deferred tax asset may not be realized. Stock Compensation The Company accounts for stock-based employee compensation using the fair value based method of accounting. We classify share-based payment awards granted in exchange for employee services as either equity awards or liability awards. Equity-classified awards are measured based on the fair value on the date of grant. Awards that are to be settled in cash are classified as liability awards. The value of all of the Company's share-based awards is recognized over the period during which an employee is required to provide services in exchange for the award - the requisite service period (usually the vesting period). No compensation costs are recognized for awards for which employees do not complete the requisite service period. Earnings per Share Net income per share-basic is calculated as net income available to common stockholders divided by the weighted average number of common shares outstanding during the period, including nonvested restricted stock which has nonforfeitable dividend rights. Net income per share-diluted is calculated as net income available to common stockholders plus noncontrolling interests in CPLP divided by the diluted weighted average number of common shares outstanding during the period. Diluted weighted average number of common shares uses the same weighted average share number as in the basic calculation and adds the potential dilution that would occur if i) the outside units in CPLP were converted into the Company's common stock, ii) any stock options were exercised, iii) any forward sales contracts of our common stock were settled, and F-11 Table of Contents iv) equity-based restricted stock units ("RSUs") as well as shares to be issued under the Employee Stock Purchase Plan (“ESPP”) were vested and settled resulting in additional common shares outstanding, all calculated using the treasury stock method, as applicable. Stock options are dilutive when the average market price of the Company’s stock during the period exceeds the option exercise price. RSUs are dilutive if the shares to be granted (assuming the end of the reporting period is the end of the measurement of any required market and performance achievement) exceed the shares assumed to be repurchased under the treasury stock method (using related unamortized compensation costs as proceeds). Shares to be issued under the ESPP are dilutive if the estimated shares to be purchased under the plan based on current enrollment elections exceed the shares assumed to be repurchased under the treasury stock method (using both employee ESPP contributions and related unamortized compensation costs as proceeds). On January 1, 2021, the Company early adopted ASU 2020-06, "Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40)" ("ASU 2020-06"). The adoption of ASU 2020-06 could potentially impact the denominator in our diluted earnings per share calculation in the future. For the year ended December 31, 2021, it did not impact the denominator. Cash and Cash Equivalents Cash and cash equivalents include unrestricted cash and highly-liquid money market instruments. Highly-liquid money market instruments include securities and repurchase agreements with original maturities of three months or less, money market mutual funds, and United States Treasury Bills with maturities of 30 days or less. Restricted Cash Restricted cash primarily includes escrow accounts held by lenders for reserves or to pay real estate taxes. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. 3. TRANSACTIONS WITH TIER REIT, INC. On June 14, 2019, pursuant to the Agreement and Plan of Merger dated March 25, 2019 (the “Merger Agreement”), by and among the Company and TIER REIT, Inc. (“TIER”), TIER merged with and into a subsidiary of the Company (the “Merger”) with this subsidiary continuing as the surviving corporation of the Merger. The Merger has enhanced the Company's position in its existing markets of Austin and Charlotte, provided a strategic entry into Dallas, and rebalanced the Company's portfolio across its markets. In accordance with the terms and conditions of the Merger Agreement, each share of TIER common stock issued and outstanding immediately prior to the Merger, was converted into 2.98 newly issued, pre-reverse split shares of the Company’s common stock with fractional shares being settled in cash. In the Merger, former TIER common stockholders received approximately 166 million pre-reverse split shares of common stock of the Company. As discussed in note 1 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020, immediately following the Merger, the Company completed a 1-for-4 reverse stock split. The Merger has been accounted for as a business combination with the Company as the accounting acquirer, which requires, among other things, that the assets acquired and liabilities assumed be recognized at their acquisition date fair value. The total value of the transaction is based on the closing stock price of the Company's common stock on June 13, 2019, the day immediately prior to the closing of the Merger. Based on the shares issued in the transaction, the total fair value of the assets acquired net of liabilities assumed in the Merger was $ 1.6 billion. During the years ended December 31, 2020 and December 31, 2019, the Company incurred expenses related to the Merger of $ 428,000 and $ 52.9 million, respectively. During 2021, there were no expenses incurred related to the Merger. F-12 Table of Contents Management engaged a third party valuation specialist to assist with valuing the real estate assets acquired and liabilities assumed in the Merger. The third party used cash flow analyses, as well as a market approach, an income approach, and a cost approach to determine the fair value of real estate assets acquired. The purchase price was allocated as follows (in thousands): Real estate assets $ 2,202,073 Real estate assets held for sale 20,835 Cash and cash equivalents 84,042 Restricted cash 1,947 Notes and other receivables 8,278 Investment in unconsolidated joint ventures 331 Intangible assets 141,184 Other assets 10,040 2,468,730 Notes payable 747,549 Accounts payable and accrued expenses 53,321 Deferred income 8,388 Intangible liabilities 47,988 Other liabilities 7,793 Nonredeemable noncontrolling interests 5,329 870,368 Total purchase price $ 1,598,362 The following unaudited supplemental pro forma information is based upon the Company's historical consolidated statements of operations, adjusted as if the Merger had occurred on January 1, 2018. The supplemental pro forma information is not necessarily indicative of future results, or of actual results, that would have been achieved had the Merger been consummated at the beginning of the period. Year ended December 31, 2019 (unaudited, in thousands) Revenues $ 750,080 Net income 232,136 Net income available to common stockholders 229,503 2019 supplemental pro forma earnings were adjusted to exclude the $ 52.9 million of transaction costs incurred in the year ended December 31, 2019. 4. TRANSACTIONS WITH NORFOLK SOUTHERN RAILWAY COMPANY On March 1, 2019, the Company entered into a series of agreements and executed related transactions with Norfolk Southern Railway Company (“NS”) as follows: • Sold land to NS for $ 52.5 million. • Executed a Development Agreement with NS whereby the Company will receive fees totaling $ 5 million in consideration for development services for NS’s corporate headquarters that is being constructed on the land sold to NS. • Executed a Consulting Agreement with NS whereby the Company will receive fees totaling $ 32 million in consideration for consulting services for NS’s corporate headquarters. The Development Agreement and Consulting Agreement are collectively referred to below as the “Fee Agreements.” • Purchased a building from NS (“Promenade Central fka 1200 Peachtree”) for $ 82 million subject to a three-year market rate lease with NS that covers the entire building. F-13 Table of Contents The Company sold the land to NS for $ 5.0 million above its carrying amount, which included $ 37.0 million of land purchased in 2018, $ 6.5 million of land purchased in 2019, and $ 4.0 million of site preparation work. The Company purchased Promenade Central fka 1200 Peachtree from NS for an amount it determined to be $ 10.3 million below the building’s fair value. The Company determined that all contracts and transactions associated with NS should be combined for accounting purposes, and the amounts exchanged under the combined contracts should be allocated to the various components of the overall transaction at fair value or market value as discussed below. The Company determined that the purchase of Promenade Central fka 1200 Peachtree should be recorded at fair value of $ 92.3 million. The Company determined that the lease with NS at the Promenade Central fka 1200 Peachtree building was at market value under ASC 842. The land sale was accounted for under ASC 610-20, and no gain or loss was recorded on the derecognition of this non-financial asset as the fair value was determined to equal the carrying amount. Consideration related to various services provided to NS, and accounted for under ASC 606, was determined to be $ 52.3 million and represents the negotiated market value for the services agreed to by the Company and NS in the contracts. This amount included non-cash consideration of the $ 10.3 million discount on the purchase of Promenade Central fka 1200 Peachtree as well as cash consideration of $ 5.0 million from the land sale contract (difference between fair value and contract amount), $ 5.0 million from the Development Agreement, and $ 32.0 million from the Consulting Agreement. Since all of the agreements and contracts above were executed for the purpose of delivering and constructing a corporate headquarters for NS and all of the services and deliverables are highly interdependent, the Company determined that the services represent a single performance obligation under ASC 606. The Company determined that control of the services to be provided is being transferred over time and, thus, the Company must recognize the $ 52.3 million contract price in revenue as it satisfies the performance obligation. The Company determined that the inputs method of measuring progress of satisfying the performance obligation was the most appropriate method of recognizing revenue for the services component. Therefore, the Company began recognizing revenue on March 1, 2019, based upon the time spent by the Company’s employees in providing these services as compared to the total estimated time required to satisfy the performance obligation. During the years ended December 31, 2021, 2020, and 2019, the Company recognized $ 11.9 million, $ 14.9 million, and $ 21.4 million, respectively, in fee income in the consolidated statements of operations related to the services provided to NS. As of December 31, 2021 and December 31, 2020, the Company had deferred income related to NS included in the consolidated balance sheet of $ 1.8 million and $ 5.7 million, respectively. F-14 Table of Contents 5. REAL ESTATE Acquisitions During 2021 and 2020, the Company acquired three and one office properties, respectively. The following table summarizes these transactions and the resulting purchase price allocations ($ in thousands): 300 Colorado Heights Union 725 Ponce The RailYard Gross Purchase Price $ 162,500 (1) $ 144,800 $ 300,200 $ 201,000 Acquisition Date December 2021 October 2021 July 2021 December 2020 Square Feet 369,000 294,000 372,000 329,000 Market Austin Tampa Atlanta Charlotte Purchase Price Allocation Tangible assets Operating properties $ 297,259 $ 133,489 $ 292,946 $ 201,153 297,259 133,489 292,946 201,153 Intangible assets In-place leases 13,974 5,894 12,788 8,850 Below market ground lease 840 — — — Above market leases 21 1,322 1,770 439 14,835 7,216 14,558 9,289 Intangible liabilities Below market leases ( 10,369 ) ( 2,501 ) ( 6,739 ) ( 9,129 ) ( 10,369 ) ( 2,501 ) ( 6,739 ) ( 9,129 ) Total net assets acquired (2) $ 301,725 $ 138,204 $ 300,765 $ 201,313 (1) Purchase price represents cost of acquiring partners' 50 % interest in 300 Colorado Project LP, resulting in consolidation of this previously unconsolidated property (see note 7 for more information on this transaction). (2) Represents net purchase price, including acquisition costs. During 2021 and 2020, the Company acquired multiple land parcels. The following table summarizes these transactions ($ in thousands): Market Acres Gross Purchase Price 2021: 887 West Peachtree (fka 901 West Peachtree) Atlanta 0.7 $ 10,000 3354/3356 Peachtree Atlanta 0.2 $ 8,000 2020: South End Station Charlotte 3.4 $ 28,100 303 Tremont Charlotte 2.4 $ 18,800 During 2020, the Company also acquired a 1,550 space parking garage in Charlotte for a gross price of $ 85.3 million, including acquisition costs. F-15 Table of Contents Dispositions During 2021 and 2020, the Company sold three and two office properties, respectively. The following table summarizes these transactions ($ in thousands): Property Location Date Square Feet Sales Price Gain/(Loss) on Sale, net 2021: 816 Congress Austin December 2021 435,000 $ 174,000 $ 77,400 One South at the Plaza Charlotte July 2021 891,000 $ 271,500 $ 12,700 Burnett Plaza Fort Worth April 2021 1,000,000 $ 137,500 $ ( 19 ) 2020: Hearst Tower Charlotte March 2020 966,000 $ 455,500 $ 90,300 Woodcrest Cherry Hill, NJ February 2020 386,000 $ 25,300 $ — The Company sold the properties noted above as part of its ongoing investment strategy, using these proceeds to fund new investment activity. The Company recorded a gain of $ 90.2 million from the 2021 sales. The Company recorded a gain of $ 90.3 million from the 2020 sales, which is net of $ 459,000 of state income tax. The Company did not sell any operating properties in 2019. In July 2021, the Company sold 0.7 acres of land in Phoenix, adjacent to our 100 Mill development, to a hotel developer for $ 6.4 million. Net proceeds approximated our book value. During February 2019, the Company sold air rights that cover eight acres in Downtown Atlanta for a gross price of $ 13.3 million and recorded a gain of $ 13.1 million. Held for Sale Building The Company's Burnett Plaza property in Fort Worth was classified as held for sale as of December 31, 2020 as the result of the Company accepting an offer for the sale of the property in the fourth quarter of 2020. The major classes of assets and liabilities of this property held for sale were as follows (in thousands): December 31, 2020 Real estate asset and other assets held for sale Operating property, net of accumulated depreciation of $ 8,123 $ 106,864 Notes and accounts receivable 439 Deferred rents receivable 2,480 Intangible assets, net of accumulated amortization of $ 6,065 15,830 Other assets 133 Total real estate asset and other assets held for sale $ 125,746 Liabilities of real estate asset held for sale Accounts payable and accrued expenses $ 7,399 Deferred income 44 Intangible liabilities, net of accumulated amortization of $ 1,205 3,014 Other liabilities 2,149 Total liabilities of real estate asset held for sale $ 12,606 Impairment The Company tests for impairment whenever changes in circumstances indicate a building’s carrying value may not be recoverable. The test is conducted using undiscounted cash flows for the shorter of the building’s estimated hold period or its remaining useful life. When testing for recoverability of buildings held for investment, projected cash flows are used over its expected hold period. If the expected hold period includes some likelihood of shorter-term hold period from a potential sale, the probability of a sale is layered into the analysis. If any building's held for investment analysis were to fail the impairment F-16 Table of Contents test, its book value would be written down to its then current estimated fair value, before any selling expense, and that building would continue to depreciate over its remaining useful life. None of the Company’s buildings were impaired during any periods presented while under the held for investments classification. During the fourth quarter of 2020, the Company decided to accept an offer, with conditions, on Burnett Plaza. Based on the status of this offer as of December 31, 2020, the Company concluded the sale was probable within one year and, therefore, transferred the assets and liabilities of the building to held for sale. Because the carrying value of the building exceeded the expected net sale proceeds (including selling costs), the Company recorded a $ 14.8 million impairment charge in the accompanying statement of operations. The net proceeds were based on the third-party offer to purchase (a Level 2 input under authoritative guidance for fair value measurements). The Company may record additional impairment charges if operating results of individual buildings are materially different from our forecasts, the economy and the office industry weakens, or we shorten our contemplated holding period for additional buildings. 6. LEASES At December 31, 2021, the Company had three properties subject to operating ground leases with a weighted average remaining term of 79 years and one finance ground lease with a remaining term of four years . At December 31, 2021, the Company had right-of-use assets from operating ground leases of $ 46.1 million included in operating properties or land on the consolidated balance sheet and right-of-use assets from finance ground leases of $ 3.7 million included in land on the consolidated balance sheet. At December 31, 2021, the Company had lease liabilities for operating and finance ground leases of $ 49.5 million and $ 3.6 million, respectively, included in other liabilities on the consolidated balance sheet. The weighted average discount rate used in determining these liabilities associated with ground leases at December 31, 2021 was 4.3 %. Rental payments on these ground leases are adjusted periodically based on either the Consumer Price Index, changes in developed square feet on the underlying leased asset, or on a pre-determined schedule. The monthly payments on a pre-determined schedule are recognized on a straight-line basis over the terms of the respective leases while payments resulting from changes in the Consumer Price Index or future development are reflected in the statement of operations at the time of the change. For the years ended December 31, 2021, 2020, and 2019, the Company recognized operating ground lease expense of $ 4.1 million, $ 4.3 million, and $ 3.9 million, respectively. For the year ended December 31, 2021 the Company had no variable lease expenses related to ground lease expense, and recognized interest expense related to finance ground leases of $ 162,000 . For the year ended December 31, 2021, the Company paid $ 2.3 million in cash related to operating ground leases and made $ 162,000 in cash payments related to financing ground leases. The following table represents the undiscounted cash flows of our scheduled obligations for future minimum payments for ground leases as of December 31, 2021, with a reconciliation of these cash flows to the related ground lease liabilities in accordance with ASC 842 (in thousands): Operating Ground Leases Finance Ground Leases 2022 $ 1,921 $ 162 2023 1,925 162 2024 1,933 162 2025 1,958 3,676 2026 2,006 — Thereafter 175,323 — $ 185,066 $ 4,162 Discount ( 135,596 ) ( 607 ) Lease liability $ 49,470 $ 3,555 F-17 Table of Contents The following table represents the undiscounted cash flows of our scheduled obligations for future minimum payments for ground leases as of December 31, 2020, with a reconciliation of these cash flows to the related ground lease liabilities in accordance with ASC 842 (in thousands): Operating Ground Leases Finance Ground Leases 2021 $ 2,959 $ 162 2022 2,672 162 2023 2,614 162 2024 2,497 162 2025 2,517 3,676 Thereafter 197,589 — $ 210,848 $ 4,324 Discount ( 152,229 ) ( 769 ) Lease liability $ 58,619 $ 3,555 7. INVESTMENT IN UNCONSOLIDATED JOINT VENTURES The following information summarizes financial data and principal activities of the Company’s unconsolidated joint ventures. The information included in the following table entitled summary of financial position is as of December 31, 2021 and 2020 (in thousands). The information included in the summary of operations table is for the years ended December 31, 2021, 2020, and 2019 (in thousands). SUMMARY OF FINANCIAL POSITION Total Assets Total Debt Total Equity (Deficit) Company's Investment 2021 2020 2021 2020 2021 2020 2021 2020 Operating Properties: AMCO 120 WT Holdings, LLC $ 83,546 $ 85,449 $ — $ — $ 82,739 $ 84,311 $ 15,347 $ 15,735 Carolina Square Holdings LP 113,011 118,616 132,654 77,034 ( 34,066 ) 21,888 ( 15,786 ) (1) 12,430 Crawford Long - CPI, LLC 24,709 29,641 64,566 66,310 ( 40,221 ) ( 38,253 ) ( 19,356 ) (1) ( 18,289 ) (1) Under Development: Neuhoff Holdings LLC 133,691 — 28,390 — 93,218 — 47,529 — Land: 715 Ponce Holdings LLC 8,150 — — — 8,150 — 4,165 — HICO Victory Center LP 16,421 16,544 — — 15,962 15,709 10,723 10,595 Other: Austin 300 Colorado Project, LP (purchased outside interest December 2021) — 165,586 — 86,848 — 68,567 — 38,488 DC Charlotte Plaza LLLP (sold September 2021) — 173,704 — — — 90,648 — 47,941 Other 518 1,313 — — 11 1,316 47 292 $ 380,046 $ 590,853 $ 225,610 $ 230,192 $ 125,793 $ 244,186 $ 42,669 $ 107,192 (1) These negative balances are included in deferred income on the consolidated balance sheets. F-18 Table of Contents SUMMARY OF OPERATIONS Total Revenues Net Income (Loss) Company's Income (Loss) from Investment 2021 2020 2019 2021 2020 2019 2021 2020 2019 Operating Properties: AMCO 120 WT Holdings, LLC $ 8,894 $ 3,000 $ 40 $ 639 $ 2,740 $ ( 341 ) $ 115 $ ( 552 ) $ ( 68 ) Carolina Square Holdings LP 16,518 14,581 12,344 2,187 3,061 470 982 1,472 133 Crawford Long - CPI, LLC 13,118 12,650 12,664 4,032 3,797 3,897 1,869 1,808 1,866 Under Development: Neuhoff Holdings LLC 51 — — 51 — — 25 — — Land: 715 Ponce Holdings LLC 84 — — 55 — — 27 — — HICO Victory Center LP 232 356 513 232 356 513 125 178 276 Other: Austin 300 Colorado Project, LP (purchased outside interest December 2021) 8,747 841 422 2,012 466 199 972 233 100 Charlotte Gateway Village, LLC (sold March 2020) 378 6,692 27,708 369 3,202 10,285 185 1,658 5,143 DC Charlotte Plaza LLLP (sold September 2021) 15,217 20,439 15,636 5,491 7,272 5,894 2,539 3,380 2,947 Terminus Office Holdings LLC (purchased outside interest October 2019) — — 34,964 — — 4,962 — ( 23 ) 2,381 Other — 4,300 180 ( 151 ) 515 ( 194 ) ( 38 ) ( 207 ) ( 112 ) $ 63,239 $ 62,859 $ 104,471 $ 14,917 $ 21,409 $ 25,685 $ 6,801 $ 7,947 $ 12,666 Joint Ventures with Operating Properties AMCO 120 WT Holdings, LLC ("AMCO") — AMCO is a joint venture between the Company, with a 20 % interest, and affiliates of AMLI Residential (“AMLI”), with an 80 % interest, formed to develop, own, and operate 120 West Trinity, a mixed-use property in Decatur, Georgia. The property contains 33,000 square feet of office space, 19,000 square feet of retail space, and 330 apartment units. Initial contributions to the joint venture for the purchase of land were funded entirely by AMLI. Subsequent contributions are funded in proportion to the members' percentage interests. The assets of the venture in the above table include a cash balance of $ 42,000 at December 31, 2021. Carolina Square Holdings LP ("Carolina Square") — Carolina Square is a 50 - 50 joint venture between the Company and NR 123 Franklin LLC ("Northwood Ravin"), that owns and operates a mixed-use property in Chapel Hill, North Carolina. This property contains 158,000 square feet of office space, 44,000 square feet of retail space, and 246 apartment units. In March 2021, Carolina Square issued a non-recourse mortgage note with a principal balance of $ 135.7 million. Proceeds from the issuance of this mortgage note were used to repay in full its $ 77.5 million construction loan that was set to mature May 1, 2021 and to make a pro-rata distribution of $ 26.0 million to each partner. The mortgage bears interest at The London Interbank Offered Rate ("LIBOR") plus 1.80 % and matures on March 18, 2026. The assets of the venture in the table above include a cash balance of $ 4.7 million at December 31, 2021. Crawford Long—CPI, LLC ("Crawford Long" ) — Crawford Long is a 50 - 50 joint venture between the Company and Emory University that owns Emory University Hospital Midtown, a 358,000 square foot medical office building located in Atlanta, Georgia. Crawford Long has a $ 64.6 million, 3.5 % fixed rate mortgage note which matures on June 1, 2023. The assets of the venture in the above table include a cash balance of $ 2.0 million at December 31, 2021. Joint Ventures with Properties Under Development Neuhoff Holdings LLC ("Neuhoff") — Neuhoff is a 50 - 50 joint venture between the Company and Neuhoff Acquisition LLC ("JPM") formed for the purpose of developing a mixed-use property in Nashville, Tennessee. The Company made an initial contribution of $ 35.1 million for its interest in the land and development costs incurred to date. In addition to the existing assets of the joint venture, Neuhoff also has rights to adjacent parcels for future development. On September 30, 2021, the joint venture closed on a construction loan with a borrowing capacity up to $ 312.7 million. The mortgage bears interest at the London Interbank Offering Rate ("LIBOR") plus 3.45 % to 3.60 % and matures on September 30, 2025. The assets of the venture in the above table include a cash balance of $ 732,000 at December 31, 2021. F-19 Table of Contents Joint Ventures with Land Holdings 715 Ponce Holdings LLC ("715 Ponce") — 715 Ponce is a 50 - 50 joint venture between the Company and 715 Acquisition LLC ("JPM") formed for the purpose of developing a property in Midtown Atlanta, Georgia in the future. The Company made an initial contribution of $ 4.0 million for its interest in the land held by the joint venture. The assets of the venture in the above table include a cash balance of $ 99,000 at December 31, 2021. HICO Victory Center LP ("HICO") — HICO is a joint venture between the Company and Hines Victory Center Associates Limited Partnership ("Hines Victory"), formed for the purpose of acquiring and subsequently developing an office parcel in Dallas, Texas. Pursuant to the joint venture agreement, all pre-development expenditures, other than land, are funded equally by the partners. The Company funded 75 % of the cost of land while Hines Victory funded 25 %. If the partners decide to commence construction of an office building, the capital accounts and economics of the venture will be adjusted such that the Company will own at least 90 % of the venture and Hines will own up to 10 %. As of December 31, 2021, the Company accounted for its investment in HICO under the equity method because it does not control the activities of the venture. If the partners decide to construct an office building within the venture, the Company expects to consolidate the venture. The assets of the venture in the table above include a cash balance of $ 453,000 at December 31, 2021. Other Joint Ventures Austin 300 Colorado Project, LP ("300 Colorado") — 300 Colorado was a 50 - 50 joint venture between the Company, 3C Block 28 Partners, LP ("3CB"), and 3C RR Xylem, LP ("3CRR"), formed to develop, own, and operate a 369,000 square foot office property in Austin, Texas. On December 2, 2021, the Company purchased the remaining 50 % interest from its partners for a gross price of $ 162.5 million. As a result, the Company consolidated 300 Colorado and recorded the assets and liabilities at fair value on the transaction date. The construction loan was paid off concurrent with the Company's purchase of its partners' interest. Upon consolidation, the Company recognized a $ 62.5 million gain on this acquisition achieved in stages and recorded this amount in gain on investment property transactions. Charlotte Gateway Village, LLC ("Gateway") — Gateway was a 50 - 50 joint venture between the Company and Bank of America Corporation (“BOA”), which owned and operated Gateway Village, a 1.1 million square foot office building in Charlotte, North Carolina. On March 31, 2020 the Company sold its interest in Gateway to its partner for a gross purchase price of $ 52.2 million. The sale was triggered by the exercise of the partner's purchase option and the proceeds from this sale represented a 17 % internal rate of return for the Company on its invested capital, as stipulated in the partnership agreement. The Company recognized a gain of $ 44.6 million on the sale of its interest in Gateway included in gain on sales of investments in unconsolidated joint ventures, net of $ 227,000 of state income tax. DC Charlotte Plaza LLLP ("Charlotte Plaza") — Charlotte Plaza was a 50 - 50 joint venture between the Company and Dimensional Fund Advisors ("DFA"), formed to develop, own, and operate DFA's 281,000 square foot regional headquarters building in Charlotte, North Carolina. On September 30, 2021, the Company sold its interest in Charlotte Plaza for a gross price of $ 60.8 million. The sale was triggered by the exercise of the partner's purchase option as stipulated in the partnership agreement. The Company recognized a gain of $ 13.1 million on the sale of its interest in Charlotte Plaza and recorded this amount in gain on sales of investments in unconsolidated joint ventures. Terminus Office Holdings LLC ("TOH") — TOH was a 50 - 50 joint venture between the Company and institutional investors advised by J.P. Morgan Asset Management ("JPM"), which owned and operated two office buildings in Atlanta, Georgia. On October 1, 2019 the Company purchased JPM's 50 % interest in TOH for $ 148 million in a transaction that valued Terminus 100 and Terminus 200 at $ 503 million. As a result, the Company consolidated TOH and recorded the assets and liabilities at fair value on the transaction date. Upon consolidation, the Company recognized a $ 92.8 million gain on this acquisition achieved in stages and recorded this amount in gain on investment property transactions. CL Realty, LLC ("CL Realty") — CL Realty was a 50 - 50 joint venture between the Company and Forestar Group, Inc., that owned land near Padre Island in Texas. In December 2020, CL Realty sold the land to a third party. The Company's share of net proceeds was $ 2.2 million and share of loss on the sale, included in income from unconsolidated joint ventures, was $ 598,000 . TEMCO Associates, LLC ("Temco") — Temco was a 50 - 50 joint venture between the Company and Forestar Group, Inc., that owned a golf course in Georgia. In December 2020, the Company sold its remaining interest in Temco, to its venture partner for a gross purchase price of $ 786,000 and recognized a loss of $ 145,000 on the sale, included in gain on sales of investments in unconsolidated joint ventures. F-20 Table of Contents Wildwood Associates ("Wildwood") — Wildwood was a 50 - 50 joint venture between the Company and IBM which owned 6.3 acres of undeveloped land in the Wildwood Office Park in Atlanta, Georgia. In February 2020 the Company sold its remaining interest in the Wildwood Associates joint venture to its venture partner for a gross purchase price of $ 900,000 . The Company recognized a gain of $ 1.3 million on the sale of its interest in Wildwood Associates, which included elimination of the remaining negative basis in the joint venture of $ 520,000 and which is included in gain on sales of investments in unconsolidated joint ventures. At December 31, 2021, the Company's unconsolidated joint ventures had aggregate outstanding indebtedness to third parties of $ 225.6 million. These loans are mortgage or construction loans, most of which are non-recourse to the Company, except as described above. In addition, in certain instances, the Company provides “non-recourse carve-out guarantees” on these non-recourse loans. The Company recognized $ 3.3 million, $ 2.6 million, and $ 7.1 million of development, leasing, and management fees, including salary and expense reimbursements, from unconsolidated joint ventures in 2021, 2020, and 2019, respectively. 8. INTANGIBLE ASSETS AND LIABILITIES At December 31, 2021 and 2020, intangible assets and liabilities included the following (in thousands): 2021 2020 Intangible Assets: In-place leases, net of accumulated amortization of $ 134,930 and $ 212,413 in 2021 and 2020, respectively $ 129,538 $ 145,290 Above-market leases, net of accumulated amortization of $ 25,423 and $ 33,548 in 2021 and 2020, respectively 19,537 24,960 Below-market ground leases, net of accumulated amortization of $ 1,449 and $ 1,173 in 2021 and 2020, respectively 17,804 17,240 Goodwill 1,674 1,674 $ 168,553 $ 189,164 Intangible Liabilities: Below-market leases, net of accumulated amortization of $ 55,079 and $ 73,612 in 2021 and 2020 $ 63,223 $ 68,219 Above-market ground leases, net of accumulated amortization of $ 354 in 2020 — 1,627 $ 63,223 $ 69,846 Aggregate net amortization expense related to intangible assets and liabilities was $ 32.7 million, $ 43.1 million, and $ 45.6 million for the years ended December 31, 2021, 2020, and 2019, respectively. Over the next five years and thereafter, aggregate amortization of these intangible assets and liabilities is anticipated to be as follows (in thousands): In-Place Leases Above-Market Leases Below-Market Ground Leases Below-Market Leases Total 2022 $ 27,424 $ 4,542 $ 411 $ ( 11,169 ) $ 21,208 2023 23,196 3,769 400 ( 9,635 ) 17,730 2024 19,210 3,007 400 ( 8,920 ) 13,697 2025 15,452 2,013 400 ( 8,354 ) 9,511 2026 12,056 1,591 400 ( 6,583 ) 7,464 Thereafter 32,200 4,615 15,793 ( 18,562 ) 34,046 $ 129,538 $ 19,537 $ 17,804 $ ( 63,223 ) $ 103,656 Weighted average remaining lease term 6 years 7 years 63 years 7 years The carrying amount of goodwill did not change during the years ended December 31, 2021 and 2020. F-21 Table of Contents 9. OTHER ASSETS At December 31, 2021 and 2020, other assets included the following (in thousands): 2021 2020 Predevelopment costs and earnest money $ 20,677 $ 17,841 Furniture, fixtures and equipment, leasehold improvements, and other deferred costs, net of accumulated depreciation of $ 18,560 and $ 32,582 in 2021 and 2020, respectively 13,772 17,211 Prepaid expenses and other assets 6,998 6,095 Lease inducements, net of accumulated amortization of $ 3,721 and $ 3,316 in 2021 and 2020, respectively 5,735 5,771 Line of credit deferred financing costs, net of accumulated amortization of $ 5,976 and $ 4,461 in 2021 and 2020, respectively 1,507 3,021 $ 48,689 $ 49,939 Predevelopment costs represent amounts that are capitalized related to predevelopment projects that the Company determined are probable of future development. Lease inducements are incentives paid to tenants in conjunction with leasing space, such as moving costs, sublease arrangements of prior space, and other costs. These amounts are amortized into rental revenues over the individual underlying lease terms. 10. NOTES PAYABLE The following table summarizes the terms of notes payable outstanding at December 31, 2021 and 2020 ($ in thousands): Description Interest Rate (1) Maturity (2) 2021 2020 Unsecured Notes: Credit Facility, Unsecured 1.15 % 2023 $ 228,500 $ 232,400 Term Loan, Unsecured 1.15 % 2024 350,000 250,000 2019 Senior Notes, Unsecured 3.95 % 2029 275,000 275,000 2017 Senior Notes, Unsecured 3.91 % 2025 250,000 250,000 2019 Senior Notes, Unsecured 3.86 % 2028 250,000 250,000 2019 Senior Notes, Unsecured 3.78 % 2027 125,000 125,000 2017 Senior Notes, Unsecured 4.09 % 2027 100,000 100,000 1,578,500 1,482,400 Secured Mortgage Notes: Fifth Third Center 3.37 % 2026 133,672 137,057 Colorado Tower 3.45 % 2026 112,150 114,660 Terminus 100 5.25 % 2023 111,678 114,997 Promenade 4.27 % 2022 89,052 92,593 Domain 10 (3) 3.75 % 2024 76,412 78,232 Terminus 200 3.79 % 2023 72,561 74,354 Legacy Union One 4.24 % 2023 66,000 66,000 661,525 677,893 $ 2,240,025 $ 2,160,293 Unamortized premium 3,910 7,574 Unamortized loan costs ( 6,426 ) ( 5,148 ) Total Notes Payable $ 2,237,509 $ 2,162,719 (1) Interest rate as of December 31, 2021. (2) Weighted average maturity of notes payable outstanding at December 31, 2021 was 3.9 years. (3) At December 31, 2020, this mortgage was secured by the Company's 816 Congress property. F-22 Table of Contents Credit Facility The Company has a $ 1 billion senior unsecured line of credit (the "Credit Facility") that matures on January 3, 2023. The Credit Facility contains financial covenants that require, among other things, the maintenance of an unencumbered interest coverage ratio of at least 1.75 x; a fixed charge coverage ratio of at least 1.50 x; a secured leverage ratio of no more than 40 %; and an overall leverage ratio of no more than 60 %. The Credit Facility also contains customary representations and warranties and affirmative and negative covenants, as well as customary events of default. The amounts outstanding under the Credit Facility may be accelerated upon the occurrence of any events of default. The Company is in compliance with all covenants of the Credit Facility. The Company expects to negotiate a new credit facility prior to the current maturity date which will have a borrowing capacity that meets or exceeds the current facility and extends the maturity date. The interest rate applicable to the Credit Facility varies according to the Company's leverage ratio, and may, at the election of the Company, be determined based on either (1) the current LIBOR plus a spread of between 1.05 % and 1.45 %, or (2) the greater of Bank of America's prime rate, the federal funds rate plus 0.50 %, or the one-month LIBOR plus 1.0 % (the "Base Rate"), plus a spread of between 0.10 % or 0.45 %, based on leverage. At December 31, 2021, the Credit Facility's spread over LIBOR was 1.05 %. The amount that the Company may draw under the Credit Facility is a defined calculation based on the Company's unencumbered assets and other factors. The total available borrowing capacity under the Credit Facility was $ 771.5 million at December 31, 2021. Term Loan On June 28, 2021, the Company entered into an Amended and Restated Term Loan Agreement (the "New Term Loan") that amended the former term loan agreement. Under the New Term Loan, the Company has borrowed $ 350 million that matures on August 30, 2024 with options to, on up to four successive occasions, extend the maturity date for an additional 180 days. The New Term Loan has financial covenants consistent with those of the Credit Facility. The interest rate applicable to the New Term Loan varies according to the Company's leverage ratio and may, at the election of the Company, be determined based on either (1) the Eurodollar Rate Loans plus a spread of between 1.05 % and 1.65 %, (2) the current LIBOR Daily Floating plus a spread of between 1.05 % and 1.65 %, or (3) the interest rate applicable to Base Rate Loans plus a spread of between 0.05 % and 0.65 %. At December 31, 2021, the New Term Loan's spread over LIBOR was 1.05 %. The Company is in compliance with all covenants of the New Term Loan. Prior to June 28, 2021, the Company had a $ 250 million unsecured term loan (the "Old Term Loan") that was scheduled to mature on December 2, 2021. The Old Term Loan had financial covenants consistent with those of the Credit Facility. The interest rate applicable to the Old Term Loan varied according to the Company's leverage ratio and could have, at the election of the Company, been determined based on either (1) the current LIBOR plus a spread of between 1.20 % and 1.70 %, based on leverage or (2) the greater of Bank of America's prime rate, the federal funds rate plus 0.50 %, or the one-month LIBOR plus 1.00 %, plus a spread of between 0.00 % and 0.75 %, based on leverage. Unsecured Senior Notes The Company has unsecured senior notes of $ 1.0 billion that were funded in five tranches. The first tranche of $ 100 million is due in 2027 and has a fixed annual interest rate of 4.09 %. The second tranche of $ 250 million is due in 2025 and has a fixed annual interest rate of 3.91 %. The third tranche of $ 125 million is due in 2027 and has a fixed annual interest rate of 3.78 %. The fourth tranche of $ 250 million is due in 2028 and has a fixed annual interest rate of 3.86 %. The fifth tranche of $ 275 million is due in 2029 and has a fixed annual interest rate of 3.95 %. The unsecured senior notes contain financial covenants that are consistent with those of our Credit Facility. The senior notes also contain customary representations and warranties and affirmative and negative covenants, as well as customary events of default. The Company is in compliance with all covenants of the unsecured senior notes. Secured Mortgage Notes In June 2021, the Company executed a collateral substitution for the mortgage previously secured by the Company's 816 Congress property in Austin. The mortgage is now secured by the Company's Domain 10 property in Austin. All other terms of the note were unchanged. In February 2020, the Company prepaid in full the $ 23.0 million Meridian Mark Plaza mortgage note, without penalty. As of December 31, 2021, the Company had $ 661.5 million outstanding on seven non-recourse mortgage notes. All interest rates on the secured mortgage notes are fixed. Assets with depreciated carrying values of $ 1.1 billion were pledged as security on these mortgage notes payable. F-23 Table of Contents Other Debt Information At December 31, 2021 and 2020, the estimated fair value of the Company’s notes payable was $ 2.3 billion, c alculated by discounting the debt's remaining contractual cash flows at estimated rates at which similar loans could have been obtained at December 31, 2021 and 2020. The estimate of the current market rate, which is the most significant input in the discounted cash flow calculation, is intended to replicate debt of similar maturity and loan-to-value relationship. These fair value calculations are considered to be Level 2 under the guidelines as set forth in ASC 820 as the Company utilizes market rates for similar type loans from third party brokers. For the years ended December 31, 2021, 2020, and 2019, interest was recorded as follows (in thousands): 2021 2020 2019 Total interest incurred $ 73,284 $ 74,929 $ 65,182 Interest capitalized ( 6,257 ) ( 14,324 ) ( 11,219 ) Total interest expense $ 67,027 $ 60,605 $ 53,963 Debt Maturities Future principal payments due (including scheduled amortization payments and payments due upon maturity) on the Company's notes payable at December 31, 2021 are as follows (in thousands): 2022 $ 102,401 2023 481,655 2024 429,087 2025 256,755 2026 220,127 Thereafter 750,000 $ 2,240,025 11. OTHER LIABILITIES Other liabilities on the consolidated balance sheets as of December 31, 2021 and December 31, 2020 included the following (in thousands): 2021 2020 Ground lease liability $ 49,470 $ 58,619 Prepaid rent 37,174 30,479 Security deposits 12,875 13,098 Restricted stock unit liability 7,314 10,613 Other liabilities 5,031 5,294 $ 111,864 $ 118,103 12. COMMITMENTS AND CONTINGENCIES Commitments The Company had outstanding performance bonds totaling $ 496,000 at December 31, 2021. As a lessor, the Company had a total of $ 255.6 million in future obligations under leases to fund tenant improvements and other future construction obligations at December 31, 2021. Litigation The Company is subject to various legal proceedings, claims and administrative proceedings arising in the ordinary course of business, some of which are expected to be covered by liability insurance. Management makes assumptions and estimates concerning the likelihood and amount of any potential loss relating to these matters using the latest information available. The Company records a liability for litigation if an unfavorable outcome is probable and the amount of loss or range of loss can be reasonably estimated. If an unfavorable outcome is probable and a reasonable estimate of the loss is a range, the Company accrues the best estimate within the range. If no amount within the range is a better estimate than any other amount, the Company accrues the minimum amount within the range. If an unfavorable outcome is probable but the amount of the loss cannot be reasonably estimated, the Company discloses the nature of the litigation and indicates that an estimate of the loss or range of loss cannot be made. If an unfavorable outcome is reasonably possible and the estimated loss F-24 Table of Contents is material, the Company discloses the nature and estimate of the possible loss of the litigation. The Company does not disclose information with respect to litigation where an unfavorable outcome is considered to be remote or where the estimated loss would not be material. Based on current expectations, such matters, both individually and in the aggregate, are not expected to have a material adverse effect on the liquidity, results of operations, business or financial condition of the Company. Contingencies Recent events related to the COVID-19 pandemic and the actions taken to contain it have created substantial uncertainty for all businesses, including the Company. The Company’s consolidated financial statements as of and for the year ended December 31, 2021 have been prepared in light of these circumstances without any impairments on held for use long-lived investments or significant valuation adjustments to amounts due from tenants. However, circumstances related to the COVID-19 pandemic may result in recording impairments or material valuation adjustments to amounts due from tenants in future periods. 13. STOCKHOLDERS' EQUITY In the third quarter of 2021, the Company entered into an Equity Distribution Agreement with six financial institutions known as an at-the-market stock offering program ("ATM program"), under which the Company may offer and sell shares of its common stock from time to time in "at-the-market" offerings with an aggregate gross sales price of up to $ 500 million. In connection with the ATM program, the Company may, at its discretion, enter into forward equity sale agreements. The use of a forward equity sale agreement would allow the Company to lock in a share price on the sale of shares of its common stock at the time the agreement is executed, but defer receiving the proceeds from the sale of shares until a later date, allowing the Company to better align such funding with its capital needs. Sales of shares of the Company's stock through its banking relationships, if any, are made in amounts and at times to be determined by the Company from time to time, but the Company has no obligation to sell any of the shares in the offering and may suspend sales in connection with the offering at any time. Sales of the Company's common stock under forward equity sale agreements, if undertaken, meet the derivatives and hedging guidance scope exception as the contracts are related to the Company's own stock. To date, the Company has sold 2.6 million shares under forward equity sale agreements, all of which were outstanding as of December 31, 2021, and are currently expected to settle by September 30, 2022 for proceeds of $ 104.0 million, net of $ 1.1 million of compensation to be paid with respect to such sales. The Company has not received proceeds related to these sales or issued any shares under the ATM program. To the extent unsettled shares sold under forward equity sale agreements are potentially dilutive at period end under the treasury stock method, the impact of such dilution is disclosed in the calculation included in note 18. In the first quarter of 2020, the Company issued 1.7 million shares of common stock in connection with the redemption of 1.7 million limited partnership units in CPLP. Each of the redeemed limited partnership units in CPLP was "paired" with a share of limited voting preferred stock with a par value of $ 1 per share. The shares of limited voting preferred stock were automatically redeemed by the Company without consideration when their paired limited partnership unit in CPLP was redeemed. After this redemption, the Company no longer has any preferred stock outstanding. Ownership Limitations — In order to minimize the risk that the Company will not meet one of the requirements for qualification as a REIT, the Company's Articles of Incorporation include certain restrictions on the ownership of more than 3.9 % of the Company’s total common and preferred stock, subject to waiver by the Board of Directors. Distribution of REIT Taxable Income — The following reconciles dividends paid and dividends applied in 2021, 2020, and 2019 to meet REIT distribution requirements (in thousands): 2021 2020 2019 Common and preferred dividends $ 182,839 $ 176,272 $ 142,940 Dividends treated as taxable compensation ( 192 ) ( 167 ) ( 161 ) Dividends applied to meet current year REIT distribution requirements $ 182,647 $ 176,105 $ 142,779 F-25 Table of Contents Tax Status of Distributions — The following summarizes the components of the taxability of the Company’s common stock distributions for the years ended December 31, 2021, 2020, and 2019: Total Distributions Per Share Ordinary Dividends Long-Term Capital Gain Unrecaptured Section 1250 Gain Nondividend Distributions Section 199A Dividends Section 1061 One Year Amounts Disclosure (1) Section 1061 Three Year Amounts Disclosure (1) 2021 $ 1.230000 $ 1.230000 $ — $ — $ — $ 1.230000 $ — $ — 2020 $ 1.190000 $ — $ 1.190000 $ 0.417166 $ — $ — $ 0.320351 $ 0.320351 2019 $ 1.130000 $ 0.983133 $ 0.146867 $ — $ — $ 0.983133 $ — $ — (1) Amounts included in Box 2a, Total Capital Gain Distributions, for purposes of section 1061 of the Internal Revenue Code. Section 1061 is generally applicable to direct and indirect holders of “applicable partnership interests." 14. REVENUE RECOGNITION The Company categorizes its primary sources of revenue into revenue from contracts with customers and other revenue accounted for as leases under ASC 842 as follows: • Rental property revenues consist of (1) contractual revenues from leases recognized on a straight-line basis over the term of the respective lease; (2) percentage rents recognized once a specified sales target is achieved; (3) parking revenue; (4) termination fees; and (5) the reimbursement of the tenants' share of real estate taxes, insurance, and other operating expenses. The Company's leases typically include renewal options and are classified and accounted for as operating leases. Rental property revenues are accounted for in accordance with the guidance set forth in ASC 842. • Fee income consists of development fees, management fees, and leasing fees earned from unconsolidated joint ventures and from third parties. Fee income is accounted for in accordance with the guidance set forth in ASC 606. For the years ended December 31, 2021, 2020, and 2019, the Company recognized rental property revenues of $ 739.1 million, $ 721.9 million, and $ 628.8 million, respectively, of which $ 199.0 million, $ 188.1 million, and $ 176.6 million, respectively, represented variable rental revenue. For the years ended December 31, 2021, 2020, and 2019, the Company recognized fee and other revenue of $ 16.0 million, $ 18.5 million, and $ 28.8 million, respectively. The following tables set forth the future minimum rents to be received by consolidated entities under existing non-cancellable leases as of December 31, 2021 and 2020 respectively (in thousands): December 31, 2021 2022 $ 496,020 2023 487,110 2024 472,827 2025 432,553 2026 387,711 Thereafter 1,516,491 $ 3,792,712 December 31, 2020 2021 $ 513,015 2022 489,715 2023 457,250 2024 425,805 2025 378,499 Thereafter 1,390,864 $ 3,655,148 F-26 Table of Contents 15. STOCK-BASED COMPENSATION The Company has several types of stock-based compensation — stock options, restricted stock, restricted stock units ("RSUs"), and the ESPP. The Company's compensation expense in 2021 relates to restricted stock and RSUs awarded in 2021, 2020, 2019, and 2018. Restricted stock and the 2021 and 2020 RSUs are equity-classified awards (settled in shares of the Company) for which compensation expense per share is fixed. The 2019 and 2018 RSUs are liability-classified awards (settled in cash) for which the expense fluctuates from period to period dependent, in part, on the Company's stock price. For 2021, 2020, and 2019, stock-based compensation expense, net of forfeitures, was recorded as follows (in thousands): 2021 2020 2019 Equity-classified awards: Restricted stock $ 2,677 $ 2,555 $ 2,468 Market-based RSUs 2,532 1,255 — Performance-based RSUs 881 428 — Director grants 890 1,060 1,362 6,980 5,298 3,830 Liability-classified awards Market-based RSUs 1,942 2,498 6,306 Performance-based RSUs 456 258 1,814 Service-based RSUs 690 633 1,040 Dividend equivalent units 564 675 740 3,652 4,064 9,900 Total stock-based compensation expense $ 10,632 $ 9,362 $ 13,730 On April 23, 2019, the Company's stockholders approved the Cousins Properties Incorporated 2019 Omnibus Incentive Stock Plan (the "2019 Plan") which allows the Company to issue awards of stock options, stock grants, or stock appreciation rights to employees and directors. The 2019 Plan also allows the Company to issue awards to employees that are paid in cash or stock on the vesting date in an amount equal to the fair market value, as defined, of one share of the Company’s stock. As of December 31, 2021, 3,577,897 shares were authorized to be awarded pursuant to the 2019 Plan. The Company also maintains the Cousins Properties Incorporated 2009 Incentive Stock Plan (the "2009 Plan") and the Cousins Properties Incorporated 2005 Restricted Stock Unit Plan (the “RSU Plan”), as amended, although no further issuances are permitted under the 2009 Plan or RSU Plan. Equity-Classified Awards During 2021 and 2020, the Company granted three types of equity-classified awards to key employees: (1) RSUs based on the total stockholder return of the Company, as defined, relative to that of office peers included in the SNL US Office REIT Index (the "Market-based RSUs"), (2) RSUs based on the ratio of cumulative funds from operations per share to targeted cumulative funds from operations per share (the “Performance-based RSUs”), (3) and restricted stock. During 2019, the only equity-based awards granted were restricted stock. The RSU awards are equity-classified awards to be settled in stock with issuance dependent upon the attainment of required service, market, and performance criteria. For the Market-based RSUs the Company expenses an estimate of the fair value of the awards on the grant date, calculated using a Monte Carlo valuation at grant date, ratably over the vesting period, adjusting only for forfeitures when they occur. The expense of these Market-based RSUs is not adjusted for the number of awards that actually vest. For the Performance-based RSUs the Company expenses the awards over the vesting period using the grant date fair market value of the Company's stock on the grant date. The expense is recognized ratably over the vesting period and adjusted each quarter based on the number of shares expected to vest and for forfeitures when they occur. The measurement period for both RSUs is three years starting on January 1 of the year of issuance and ending on December 31. The ultimate settlement of these awards can range from 0 % to 200 % of the targeted number of units depending on the achievement of the market and performance metrics described above. F-27 Table of Contents The Company estimates future expense for all equity-classified RSUs outstanding at December 31, 2021 to be $ 4.7 million (using estimated vesting percentages for performance-based RSUs as of December 31, 2021), which will be recognized over a weighted-average period of 1.6 years. In 2021, 2020, and 2019, the Company issued 102,262 ; 71,421 ; and 65,824 shares, respectively, of restricted stock to employees, which vest ratably over three years from the issuance date. In 2021, 2020, and 2019, the Company also issued 34,912 ; 34,059 ; and 37,166 shares, respectively, of stock to independent members of the board of directors which vested immediately on the issuance date. The Company records restricted stock in common stock and additional paid-in capital at fair value on the grant date, with the offsetting deferred compensation also recorded in additional paid-in capital. The Company records compensation expense over the vesting period. As of December 31, 2021, the Company had $ 2.7 million of unrecognized compensation cost included in additional paid-in capital related to restricted stock, which will be recognized over a weighted average period of 1.6 years. The total vesting date fair value of the restricted stock which vested during 2021, 2020, and 2019 was $ 1.9 million, $ 3.2 million, and $ 2.6 million, respectively. The following table summarizes equity-classified award activity for the years ended December 31, 2021, 2020, and 2019 (shares in thousands): 2021 2020 2019 Shares Weighted Average Fair Market Value at Grant Shares Weighted Average Fair Market Value at Grant Shares Weighted Average Fair Market Value at Grant Shares unvested at beginning of the year 221 $ 41.90 141 $ 34.81 148 $ 33.08 Granted 248 $ 35.44 173 $ 44.13 66 $ 35.64 Vested ( 58 ) $ 37.47 ( 82 ) $ 34.69 ( 72 ) $ 34.09 Forfeited ( 2 ) $ 39.27 ( 11 ) $ 41.10 ( 1 ) $ 34.46 Shares unvested at end of year 409 $ 38.63 221 $ 41.90 141 $ 34.81 The Monte Carlo valuation used to determine the grant date fair value of the equity-classified Market-based RSUs included the following assumptions for those RSUs granted in 2021 and 2020: 2021 2020 Volatility (1) 37.5 % 18.0 % Risk-free rate (2) 0.17 % 1.34 % Stock beta (3) 1.04 % 1.04 % (1) Based on historical volatility over three years using daily stock price. (2) Reflects the yield on three-year Treasury bonds. (3) Betas are calculated with up to three years of daily stock price data. Dividend equivalents for the 2021 and 2020 RSUs will be settled in shares of the Company's common stock based upon the number of units vested. The Company accrues for these dividend equivalent units over the measurement period as dividends are declared and they are included in distributions in excess of cumulative net income on the consolidated balance sheet. The targeted number of non-vested equity-classified RSUs at December 31, 2021 is 242,728 . All shares of restricted stock receive dividends and have voting rights during the vesting period. At December 31, 2021, the Company had no stock options outstanding to key employees and outside directors. In 2021, 2020, and 2019, there were no stock option grants to employees or directors, and the Company recognized no compensation expense related to stock options. During 2021 and 2020, the Company issued 24,626 and 12,373 shares for option exercises, respectively. F-28 Table of Contents The following is a summary of stock option activity for the years ended December 31, 2021, 2020, and 2019 (options in thousands): 2021 2020 2019 Number of Options Weighted Average Exercise Price Per Option Number of Options Weighted Average Exercise Price Per Option Number of Options Weighted Average Exercise Price Per Option Outstanding at beginning of year 28 $ 25.55 67 $ 23.13 114 $ 24.00 Exercised ( 28 ) $ 25.55 ( 37 ) $ 21.28 ( 42 ) $ 25.59 Forfeited/expired — — ( 2 ) $ 22.76 ( 5 ) $ 25.32 Outstanding at end of year — — 28 $ 25.55 67 $ 23.13 Liability-Classified Awards During 2019, the Company awarded three types of liability-classified awards to key employees: (1) Market-based RSUs, (2) Performance-based RSUs, (3) and Service-based RSUs. The 2019 RSU awards are liability-classified awards to be settled in cash with payment dependent upon the attainment of required market, performance, and service criteria. The vesting period for the 2019 RSUs is three years . For the 2019 Market-based RSUs, the Company expenses an estimate of the fair value of the awards over the vesting period using a quarterly Monte Carlo valuation. For the 2019 Performance-based RSUs, the Company expenses the awards over the vesting period using the fair market value of the Company’s stock at the reporting date multiplied by the anticipated number of units to be paid based on the current estimate of what the ratio is expected to be upon vesting. For the 2019 Service-based RSUs, the Company expenses the awards ratably over the vesting period using the fair market value of the Company's stock at the reporting date. The following table summarizes the Company's liability-classified award activity during the years ended December 31, 2021, 2020, and 2019 (shares in thousands): 2021 2020 2019 Shares Shares Shares Shares unvested at beginning of the year 135 316 276 Granted — — 136 Vested ( 92 ) ( 172 ) ( 95 ) Forfeited — ( 9 ) ( 1 ) Shares unvested at end of year 43 135 316 Market-based and Performance-based RSUs, dividend equivalent units will be paid based on the percentage vested. For the 2019 RSU grants, dividend equivalent units will be paid out at the time of vesting. The Company accrues and expenses for these dividend equivalent units over the service period as dividends are declared, based on the latest projected vesting percentage. For Service-based RSUs, dividend equivalent units will be paid based on the number of RSUs granted. For the 2019 time-vested RSU grants, dividend equivalent units will be paid out at the time of vesting. The Company accrues and expenses these dividend equivalent units over the service period as dividends are declared. The Company estimates future expense for all types of liability-classified RSUs outstanding at December 31, 2021 to be $ 539,000 (using stock prices as of December 31, 2021), which will be recognized over a weighted-average period of one year . During 2021, total cash paid for all types of liability-classified RSUs and related dividend payments was $ 7.2 million. F-29 Table of Contents Employee Stock Purchase Plan On October 26, 2021, the Company’s board of directors adopted the Employee Stock Purchase Plan ("ESPP"), subject to the approval of our stockholders. Pursuant to the ESPP, employees may contribute up to 15 % of their cash compensation during annual purchase periods for the purchase of Cousins’ common stock up to an annual maximum of $ 21,250 per employee. On each purchase period ending November 30, participants’ individual account balances are used to acquire shares of common stock at 85 % of the Company’s closing price as of December 1 (the beginning of the purchase period) or November 30 (the end of the purchase period), whichever is lower. As of December 31, 2021, 95 employees were enrolled in the plan with expected contributions for the purchase period ended November 30, 2022 of $ 640,000 . As of December 31, 2021, the Company estimates future expense related to the open purchase period to be $ 177,000 . As of and for the year ended December 31, 2021, no common stock has been purchased under the ESPP. 16. RETIREMENT SAVINGS PLAN The Company maintains a defined contribution plan (the “Retirement Savings Plan”) pursuant to Section 401 of the Internal Revenue Code (the “Code”) which covers active regular employees. Employees are eligible to participate in the Retirement Savings Plan immediately upon hire, and pre-tax contributions are allowed up to the limits set by the Code. The Company contributes 3 % of an employee's eligible compensation to the plan, which is fully vested after the employee has been with the Company for two years . The Company may change this percentage at its discre tion; and, in addition, the Company could decide to make discretionary contributions in the future. The Company contributed $ 1.0 million, $ 1.0 million, and $ 913,000 to the Retirement Savings Plan for the 2021, 2020, and 2019 plan years, respectively. 17. INCOME TAXES The net income tax benefit differs from the amount computed by applying the statutory federal income tax rate to CTRS' income before taxes as follows ($ in thousands): 2021 2020 2019 Amount Rate Amount Rate Amount Rate Federal income tax benefit (expenses) $ 346 21 % $ 125 21 % $ ( 65 ) ( 21 ) % State income tax benefit (expense), net of federal income tax effect 66 4 24 4 ( 12 ) ( 4 ) Deferred tax adjustment — — 21 4 127 41 Capital loss (gain) ( 10 ) — 404 68 — — Valuation allowance ( 346 ) ( 26 ) ( 586 ) ( 98 ) ( 45 ) ( 15 ) Other ( 56 ) 1 12 1 ( 5 ) ( 1 ) Benefit applicable to net income (loss) $ — — % $ — — % $ — — % The tax effect of significant temporary differences representing deferred tax assets and liabilities of CTRS as of December 31, 2021 and 2020 are as follows (in thousands): 2021 2020 Income from unconsolidated joint ventures $ 27 $ 32 Federal and state tax net operating loss carryforwards 1,163 696 Federal and state tax capital loss carryforwards 570 582 Other asset — 104 Gross deferred tax asset 1,760 1,414 Valuation allowance ( 1,760 ) ( 1,414 ) Net deferred tax asset after valuation allowance $ — $ — A valuation allowance is required to be recorded against deferred tax assets if, based on the available evidence, it is more likely than not that such assets will not be realized. When assessing the need for a valuation allowance, appropriate consideration should be given to all positive and negative evidence related to this realization. This evidence includes, among other things, the existence of current and recent cumulative losses, forecasts of future profitability, the length of statutory carryforward periods, the Company’s history with loss carryforwards, and available tax planning strategies. F-30 Table of Contents As of December 31, 2021 and 2020, the net deferred tax asset of CTRS equaled $ 1.8 million and $ 1.4 million, respectively, with a valuation allowance placed against the full amount of each. The conclusion that a valuation allowance should be recorded as of December 31, 2021 and 2020 was based on the lack of evidence that CTRS could generate future taxable income to realize the benefit of the deferred tax assets. 18. EARNINGS PER SHARE The following table sets forth the computation of the basic and diluted earnings per share of the Company's consolidated statements of operations for the years ended December 31, 2021, 2020 and 2019 (in thousands, except per share amounts): Year Ended December 31 2021 2020 2019 Earnings per common share - basic: Numerator: Net income $ 278,996 $ 238,114 $ 152,683 Net income attributable to noncontrolling interests in CPLP ( 56 ) ( 315 ) ( 1,952 ) Net income attributable to other noncontrolling interests ( 354 ) ( 521 ) ( 313 ) Net income available for common stockholders $ 278,586 $ 237,278 $ 150,418 Denominator: Weighted average common shares - basic 148,666 148,277 128,060 Net income per common share - basic $ 1.87 $ 1.60 $ 1.17 Earnings per common share - diluted: Numerator: Net income $ 278,996 $ 238,114 $ 152,683 Net income attributable to other noncontrolling interests ( 354 ) ( 521 ) ( 313 ) Net income available for common stockholders before net income attributable to noncontrolling interests in CPLP $ 278,642 $ 237,593 $ 152,370 Denominator: Weighted average common shares - basic 148,666 148,277 128,060 Add: Potential dilutive common shares - stock options 1 8 27 Potential dilutive restrictive stock units - RSUs, less shares assumed purchased at market price 199 54 — Weighted average units of CPLP convertible into common shares 25 297 1,744 Weighted average common shares - diluted 148,891 148,636 129,831 Net income per common share - diluted $ 1.87 $ 1.60 $ 1.17 Anti-dilutive stock options represent stock options whose exercise price exceeds the average market value of the Company’s stock and are excluded from the calculation of diluted earnings per share. There were no anti-dilutive stock options for the years ended December 31, 2021, 2020, and 2019. The treasury stock method resulted in no dilution related to the forward contracts outstanding as of December 31, 2021 for the future sales of common stock under the Company's ATM program or from shares expected to be issued under the ESPP. F-31 Table of Contents 19. CONSOLIDATED STATEMENTS OF CASH FLOWS - SUPPLEMENTAL INFORMATION Supplemental information related to cash flows, including significant non-cash activity affecting the consolidated statements of cash flows, for the years ended December 31, 2021, 2020, and 2019 is as follows (in thousands): 2021 2020 2019 Interest paid, net of amounts capitalized $ 68,003 $ 62,641 $ 38,062 Income taxes paid (1) 155 343 — Non-Cash Transactions: Common stock dividends declared and accrued 47,350 44,681 42,559 Transfer from projects under development to operating properties — 443,932 — Transfer from operating properties and related liabilities to assets and liabilities of real estate assets held for sale — 188,378 318,516 Non-cash assets and liabilities assumed in TIER transaction — — 1,512,373 Ground lease right-of-use assets and associated liabilities — — 56,294 Transfer from investment in unconsolidated joint ventures to operating properties 37,777 — 50,781 (1) This represents state income taxes paid in conjunction with gains from sales transaction. See notes 5 and 7 for disclosure of related expense. The following table provides a reconciliation of cash, cash equivalents, and restricted cash recorded on the balance sheet to cash, cash equivalents, and restricted cash in the statements of cash flows (in thousands): Year Ended December 31, 2021 2020 2019 Cash and cash equivalents $ 8,937 $ 4,290 $ 15,603 Restricted cash 1,231 1,848 2,005 Total cash, cash equivalents, and restricted cash $ 10,168 $ 6,138 $ 17,608 20. REPORTABLE SEGMENTS The Company's segments are based on the method of internal reporting which classifies operations by property type and geographical area. The segments by property type are: Office and Non-Office. The segments by geographical region are: Atlanta, Austin, Charlotte, Dallas, Phoenix, Tampa, and other markets. Included in other markets are properties located in Chapel Hill, Houston, Nashville, Fort Worth (sold April 2021), and a property in Cherry Hill, New Jersey (sold February 2020). Included in Non-Office are retail and apartments in Chapel Hill and Atlanta as well as the College Street Garage in Charlotte. In 2021, with the sale of the Company's One South at the Plaza office property, the Company reassessed the segment for the College Street Garage and began to treat it as Non-Office for all periods presented. These reportable segments represent an aggregation of operating segments reported to the Chief Operating Decision Maker based on similar economic characteristics that include the type of property and the geographical location. Each segment includes both consolidated operations and the Company's share of joint venture operations. Company management evaluates the performance of its reportable segments in part based on net operating income (“NOI”). NOI represents rental property revenues, less termination fees, less rental property operating expenses. NOI is not a measure of cash flows or operating results as measured by GAAP, is not indicative of cash available to fund cash needs, and should not be considered an alternative to cash flows as a measure of liquidity. All companies may not calculate NOI in the same manner. The Company considers NOI to be an appropriate supplemental measure to net income as it helps both management and investors understand the core operations of the Company's operating assets. NOI excludes corporate general and administrative expenses, reimbursed expenses, interest expense, depreciation and amortization, impairments, gains/loss on sales of real estate, gain/loss on extinguishment of debt, transaction costs and other non-operating items. F-32 Table of Contents Segment net income, amount of capital expenditures, and total assets are not presented in the following tables because management does not utilize these measures when analyzing its segments or when making resource allocation decisions. Information on the Company's segments along with a reconciliation of NOI to net income for years ended December 31, 2021, 2020, and 2019 are as follows (in thousands): Year Ended December 31, 2021 Office Non-Office Total Revenues: Atlanta $ 268,953 $ 1,459 $ 270,412 Austin 247,806 — 247,806 Charlotte 74,702 2,700 77,402 Dallas 17,670 — 17,670 Phoenix 50,292 — 50,292 Tampa 59,614 — 59,614 Other markets 39,403 5,257 44,660 Total segment revenues 758,440 9,416 767,856 Less: Company's share of rental property revenues from unconsolidated joint ventures ( 22,075 ) ( 6,718 ) ( 28,793 ) Total rental property revenues $ 736,365 $ 2,698 $ 739,063 Year Ended December 31, 2020 Office Non-Office Total Revenues: Atlanta $ 255,594 $ 602 $ 256,196 Austin 210,229 — 210,229 Charlotte 94,520 2,017 96,537 Dallas 18,143 — 18,143 Phoenix 50,671 — 50,671 Tampa 54,261 — 54,261 Other markets 59,285 4,895 64,180 Total segment revenues 742,703 7,514 750,217 Less: Company's share of rental property revenues from unconsolidated joint ventures ( 22,837 ) ( 5,497 ) ( 28,334 ) Total rental property revenues $ 719,866 $ 2,017 $ 721,883 Year Ended December 31, 2019 Office Non-Office Total Revenues: Atlanta $ 242,209 $ 8 $ 242,217 Austin 160,196 — 160,196 Charlotte 120,214 — 120,214 Dallas 9,421 — 9,421 Phoenix 51,586 — 51,586 Tampa 54,216 — 54,216 Other markets 38,732 4,630 43,362 Total segment revenues 676,574 4,638 681,212 Less: Company's share of rental property revenues from unconsolidated joint ventures ( 47,823 ) ( 4,638 ) ( 52,461 ) Total rental property revenues $ 628,751 $ — $ 628,751 F-33 Table of Contents NOI by reportable segment for the years ended December 31, 2021, 2020, and 2019 are as follows (in thousands): Year Ended December 31, 2021 Office Non-Office Total Net Operating Income: Atlanta $ 176,793 $ 622 $ 177,415 Austin 146,923 — 146,923 Charlotte 53,294 1,351 54,645 Dallas 14,014 — 14,014 Phoenix 36,244 — 36,244 Tampa 38,305 — 38,305 Other markets 22,791 3,383 26,174 Total Net Operating Income $ 488,364 $ 5,356 $ 493,720 Year Ended December 31, 2020 Office Non-Office Total Net Operating Income: Atlanta $ 172,588 $ ( 49 ) $ 172,539 Austin 125,215 — 125,215 Charlotte 63,876 1,327 65,203 Dallas 14,586 — 14,586 Phoenix 37,358 — 37,358 Tampa 33,440 — 33,440 Other markets 34,346 3,347 37,693 Total Net Operating Income $ 481,409 $ 4,625 $ 486,034 Year Ended December 31, 2019 Office Non-Office Total Net Operating Income: Atlanta $ 158,093 $ ( 48 ) $ 158,045 Austin 93,311 — 93,311 Charlotte 77,082 — 77,082 Dallas 7,473 — 7,473 Phoenix 37,247 — 37,247 Tampa 33,586 — 33,586 Other markets 21,939 3,107 25,046 Total Net Operating Income $ 428,731 $ 3,059 $ 431,790 F-34 Table of Contents The following reconciles Net Income to Net Operating Income for each of the periods presented (in thousands): Year Ended December 31, 2021 2020 2019 Net income $ 278,996 $ 238,114 $ 152,683 Net operating income from unconsolidated joint ventures 19,223 18,836 32,413 Fee income ( 15,559 ) ( 18,226 ) ( 28,518 ) Termination fee income ( 5,105 ) ( 3,835 ) ( 7,228 ) Other income ( 451 ) ( 231 ) ( 246 ) Reimbursed expenses 2,476 1,580 4,004 General and administrative expenses 29,321 27,034 37,007 Interest expense 67,027 60,605 53,963 Impairment — 14,829 — Depreciation and amortization 288,092 288,648 257,149 Transaction costs — 428 52,881 Other expenses 2,131 2,091 1,109 Income from unconsolidated joint ventures ( 6,801 ) ( 7,947 ) ( 12,666 ) Gain on sale of investment in unconsolidated joint ventures ( 13,083 ) ( 45,767 ) — Gain on sale of investment properties ( 152,547 ) ( 90,125 ) ( 110,761 ) Net Operating Income $ 493,720 $ 486,034 $ 431,790 F-35 Table of Contents SCHEDULE III COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES REAL ESTATE AND ACCUMULATED DEPRECIATION December 31, 2021 ($ in thousands) Initial Cost to Company Costs Capitalized Subsequent to Acquisition Gross Amount at Which Carried at Close of Period Description/Metropolitan Area Encumbrances Land and Improvements Buildings and Improvements Land and Improvements less Cost of Sales, Transfers and Other Building and Improvements less Cost of Sales, Transfers and Other Land and Improvements less Cost of Sales, Transfers and Other Building and Improvements less Cost of Sales, Transfers and Other Total (a)(b) Accumulated Depreciation (a)(b) Date of Construction/ Renovation Date Acquired Life on Which Depreciation in 2021 Statement of Operations is Computed (c) OPERATING PROPERTIES The Domain $ — $ 65,236 $ 755,143 $ 6,006 $ 242,768 $ 71,242 $ 997,911 $ 1,069,153 $ 68,954 — 2019 40 years Austin, TX Terminus 184,239 49,050 410,826 — 25,250 49,050 436,076 485,126 33,483 — 2019 40 years Atlanta, GA Northpark Town Center — 22,350 295,825 — 66,401 22,350 362,226 384,576 88,605 — 2014 39 years Atlanta, GA Corporate Center (d) — 2,468 272,148 17,004 59,322 19,472 331,470 350,942 57,377 — 2016 40 years Tampa, FL Spring & 8th — 28,131 — 426 301,810 28,557 301,810 330,367 40,834 2015 2015 40 years Atlanta, GA Buckhead Plaza — 35,064 234,111 — 35,679 35,064 269,790 304,854 38,155 — 2016 40 years Atlanta, GA 300 Colorado (d) — 18,354 278,905 — 240 18,354 279,145 297,499 613 — 2021 40 years Austin, TX Hayden Ferry — 13,102 262,578 ( 252 ) 20,708 12,850 283,286 296,136 52,591 — 2016 40 years Phoenix, AZ 725 Ponce — 20,720 272,226 — 610 20,720 272,836 293,556 3,503 — 2021 40 years Atlanta, GA The Terrace — 27,360 247,226 — 14,564 27,360 261,790 289,150 21,699 — 2019 40 years Austin, TX One Eleven Congress — 33,841 201,707 — 47,481 33,841 249,188 283,029 36,455 — 2016 40 years Austin, TX Briarlake Plaza — 33,486 196,915 — 3,397 33,486 200,312 233,798 20,030 — 2019 40 years Houston, TX San Jacinto Center — 34,068 176,535 ( 579 ) 18,260 33,489 194,795 228,284 29,103 — 2016 40 years Austin, TX 3344 Peachtree — 16,110 176,153 — 35,532 16,110 211,685 227,795 34,110 — 2016 40 years Atlanta, GA Fifth Third Center 133,672 22,591 180,430 — 21,088 22,591 201,518 224,109 48,836 — 2014 40 years Charlotte, NC Continued on next page The RailYard $ — $ 22,831 $ 178,323 $ — $ 216 $ 22,831 $ 178,539 $ 201,370 $ 6,518 — 2020 40 years Charlotte, NC Avalon — 9,952 — 73 177,776 10,025 177,776 187,801 20,357 2016 2016 40 years Atlanta, GA Promenade Tower (fka Promenade) 89,052 13,439 102,790 — 49,093 13,439 151,883 165,322 58,622 — 2011 34 years Atlanta, GA Colorado Tower (d) 112,150 1,600 — 20,577 130,291 22,177 130,291 152,468 42,093 2013 2013 30 years Austin, TX 3350 Peachtree — 16,836 108,177 — 20,540 16,836 128,717 145,553 16,540 — 2016 40 years Atlanta, GA Legacy Union One 66,000 13,049 128,740 — 257 13,049 128,997 142,046 12,474 — 2019 40 years Dallas, GA Heights Union — 9,545 123,944 — 5,036 9,545 128,980 138,525 873 — 2021 40 years Tampa, FL 550 South (fka Nascar Plaza) — 51 115,238 — 9,151 51 124,389 124,440 22,176 — 2016 40 years Charlotte, NC Tempe Gateway — 5,893 95,130 — 3,768 5,893 98,898 104,791 15,863 — 2016 40 years Phoenix, AZ Domain Point — 17,349 71,599 — 7,904 17,349 79,503 96,852 7,289 — 2019 40 years Austin, TX Promenade Central (fka 1200 Peachtree) — 19,495 62,836 ( 1 ) 7,194 19,494 70,030 89,524 4,534 — 2019 40 years Atlanta, GA 111 West Rio — 6,076 56,647 ( 127 ) 18,612 5,949 75,259 81,208 13,698 — 2017 40 years Phoenix, AZ 3348 Peachtree — 6,707 69,723 — 1,809 6,707 71,532 78,239 14,222 — 2016 40 years Atlanta, GA 5950 Sherry Lane — 8,040 65,919 — 2,188 8,040 68,107 76,147 6,321 — 2019 40 years Dallas, GA The Pointe — 9,404 54,694 — 7,802 9,404 62,496 71,900 12,172 — 2016 40 years Tampa, FL Harborview Plaza — 10,800 39,136 — 9,853 10,800 48,989 59,789 8,038 — 2016 40 years Tampa, FL Research Park V — 4,373 — 801 42,623 5,174 42,623 47,797 12,812 2014 1998 30 years Austin, TX Continued on next page Meridian Mark Plaza $ — $ 2,219 $ — $ — $ 30,724 $ 2,219 $ 30,724 $ 32,943 $ 23,091 1997 1997 30 years Atlanta, GA Miscellaneous Investments — 15,318 69,780 33 1,678 15,351 71,458 86,809 2,947 Total Operating Properties 585,113 614,908 5,303,404 43,961 1,419,625 658,869 6,723,029 7,381,898 874,988 PROJECTS UNDER DEVELOPMENT 100 Mill — 13,156 — — 112,909 13,156 112,909 126,065 — — 2018 Phoenix, AZ Domain 9 — 16,640 — — 32,098 16,640 32,098 48,738 — — 2018 Austin, TX Total Projects Under Development — 29,796 — — 145,007 29,796 145,007 174,803 — LAND South End Station — 28,134 — — — 28,134 — 28,134 — — 2020 Charlotte, NC 887 West Peachtree (d) (fka 901 West Peachtree) — 11,883 — 13,678 — 25,561 — 25,560 — — 2019 Atlanta, GA Legacy Union 2 & 3 — 22,724 — — — 22,724 — 22,724 — — 2019 Dallas, GA 3354 Peachtree — 13,410 — 8,099 — 21,509 — 21,509 — — 2018 Atlanta, GA Domain 14 & 15 — 21,000 — — — 21,000 — 21,000 — — 2019 Austin, TX Tremont — 18,779 — 75 — 18,854 — 18,854 — — 2020 Charlotte, NC Domain Point 3 — 11,018 — — — 11,018 — 11,018 — — 2020 Austin, TX Corporate Center (d) — 5,188 — ( 6 ) — 5,182 — 5,182 — — 2019 Tampa, FL The Avenue Forsyth -Adjacent Land — 11,240 — ( 7,540 ) — 3,700 — 3,700 — — 2007 Suburban Atlanta, GA Total Commercial Land — 143,376 — 14,306 — 157,682 — 157,681 — Total Properties $ 585,113 $ 788,080 $ 5,303,404 $ 58,267 $ 1,564,632 $ 846,347 $ 6,868,036 $ 7,714,382 $ 874,988 S-1 Table of Contents SCHEDULE III COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES REAL ESTATE AND ACCUMULATED DEPRECIATION December 31, 2021 (in thousands) NOTES: (a) Reconciliations of total real estate carrying value and accumulated depreciation for the three years ended December 31, 2021 are as follows: Real Estate Accumulated Depreciation 2021 2020 2019 2021 2020 2019 Balance at beginning of period $ 7,370,401 $ 7,158,069 $ 4,121,286 $ 811,196 $ 621,617 $ 421,495 Additions during the period: TIER merger — — 2,222,989 — — — Acquisitions 723,694 286,252 542,502 — — — Improvements and other capitalized costs 280,823 323,919 271,720 — — — Depreciation expense — — — 246,240 234,057 200,122 Total Additions 1,004,517 610,171 3,037,211 246,240 234,057 200,122 Deductions during the period: Cost of real estate sold ( 552,201 ) ( 383,010 ) ( 428 ) ( 74,113 ) ( 44,478 ) — Write Off of Fully Depreciated Assets ( 108,335 ) — — ( 108,335 ) — — Total Deductions ( 660,536 ) ( 383,010 ) ( 428 ) ( 182,448 ) ( 44,478 ) — Balance at end of period before impairment charges 7,714,382 7,385,230 7,158,069 874,988 811,196 621,617 Cumulative impairment charges on real estate assets owned at end of period — ( 14,829 ) — — — — Balance at end of period $ 7,714,382 $ 7,370,401 $ 7,158,069 $ 874,988 $ 811,196 $ 621,617 (b) The aggregate cost for federal income tax purposes, net of depreciation, was $ 5.4 billion (unaudited) at December 31, 2021. (c) Buildings and improvements are depreciated over 30 to 42 years. Leasehold improvements and other capitalized leasing costs are depreciated over the life of the asset or the term of the lease, whichever is shorter. (d) Some or all of the land at these properties is controlled under a ground lease. S-2