50 unchanged sentences
Definition and Limitations of Internal Control over Financial Reporting
−Removed: 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 accounting principles generally accepted in the United States of America (“generally accepted accounting principles”).
+Added: 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;
20 unchanged sentences
No changes have been made to the procedures by which stockholders may recommend nominees to the Company’s board of directors since the 2023 annual meeting, which was held on May 16, 2023.
+Added: The Company has adopted insider trading policies and procedures governing the purchase, sale and/or other dispositions of our securities by directors, officers and employees that are reasonably designed to promote compliance with insider trading laws, rules and regulations and NYSE listing standards.
+Added: No director or officer of the Company adopted or terminated any Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements.
See Item X in Part I of this Annual Report for biographical information regarding the Company’s executive officers.
8 unchanged sentences
Information about fees paid to and services provided by our independent registered public accounting firm is incorporated herein by reference to the Company’s Proxy Statement to be filed in connection with its annual meeting of stockholders to be held on May 14, 2024.
−Removed: EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
+Added: EXHIBITS AND FINANCIAL STATEMENT SCHEDULES - KJA/JDM Review
Reference is made to the Index to Consolidated Financial Statements on page 52 for a list of the Consolidated Financial Statements of Highwoods Properties, Inc.
16 unchanged sentences
4.12 Description of Registered Securities (filed as part of the Company’s Annual Report on Form 10-K for the year ended December 31, 2019)
+Added: 4.13 Form of 7.65% Notes due February 1, 2034 (filed as part of the Company’s Current Report on Form 8-K dated November 16, 2023)
+Added: 4.14 Officers’ Certificate Establishing the Terms of the 7.65% Notes, dated November 21, 2023 (filed as part of the Company’s Current Report on Form 8-K dated November 16, 2023)
10.1 Second Restated Agreement of Limited Partnership, dated as of January 1, 2000, of the Operating Partnership (filed as part of the Company’s Annual Report on Form 10-K for the year ended December 31, 2004)
7 unchanged sentences
Retirement Plan, effective as of March 1, 2006 (filed as part of the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2007)
+Added: Number Description
10.7 * Highwoods Properties, Inc.
2 unchanged sentences
1, dated as of November 30, 2022, to the Highwoods Properties, Inc.
−Removed: 2020 Employee Stock Purchase Plan
−Removed: Number Description
+Added: 2020 Employee Stock Purchase Plan (filed as part of the Company's Annual Report on Form 10-K for the year ended December 31, 2022)
10.9 * Executive Supplemental Employment Agreement, dated as of September 1, 2015 between the Company and Theodore J.
6 unchanged sentences
Leary (filed as part of the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019)
−Removed: 10.13 Sixth Amended and Restated Credit Agreement, dated as of March 18, 2021, by and among the Company, the Operating Partnership, Bank of America, N.A., as Administrative Agent, Wells Fargo Bank, National Association and PNC Bank, National Association, as Co-Syndication Agents, and the Other Lenders named therein (filed as part of the Company’s Current Report on Form 8-K dated March 19, 2021)
10.13 * 2021 Long-Term Equity Incentive Plan (filed as part of the Company’s Current Report on Form 8-K dated May 11, 2021)
−Removed: 10.15 First Amendment to Sixth Amended and Restated Credit Agreement, dated as of May 24, 2022, by and among the Company, the Operating Partnership, Bank of America, N.A., as Administrative Agent, and the Other Lenders named therein (filed as part of the Company’s Current Report on Form 8-K) dated May 24, 2022
+Added: 10.14 Third Amendment to Sixth Amended and Restated Credit Agreement, dated as of January 25, 2024, by and among the Company, the Operating Partnership, Bank of America, N.A., as Administrative Agent, and the Other Lenders named therein (filed as part of the Company’s Current Report on Form 8-K) dated January 25, 2024)
+Added: 19 Insider Trading Policy and Procedures
21 Schedule of Subsidiaries
23.1 Consent of Deloitte & Touche LLP for the Company
+Added: 23.2 Consent of Deloitte & Touche LLP for the Operating Partnership
31.1 Certification of CEO Pursuant to Section 302 of the Sarbanes-Oxley Act for the Company
6 unchanged sentences
32.4 Certification of CFO Pursuant to Section 906 of the Sarbanes-Oxley Act for the Operating Partnership
+Added: 97 Policy Relating to Recovery of Erroneously Awarded Compensation
101.INS Inline XBRL Instance Document (the instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document)
10 unchanged sentences
Consolidated Financial Statements:
−Removed: Consolidated Balance Sheets a s of December 31, 2022 and 2021
+Added: Consolidated Balance Sheets as of December 31, 202 3 and 202 2
Consolidated Statements of Income for the Years Ended December 31, 202 3 , 202 2 and 202 1
5 unchanged sentences
Consolidated Financial Statements:
−Removed: Consolidated Balance Sheets a s of December 31, 2022 and 2021
+Added: Consolidated Balance Sheets as of December 31, 2023 and 2022
Consolidated Statements of Income for the Years Ended December 31, 2023, 2022 and 2021
25 unchanged sentences
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 a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
−Removed: Impairment of Real Estate Assets—Refer to Note 1 and Note 3 to the financial statements
+Added: Real Estate Assets - Determination of Impairment Indicators and Impairment—Refer to Note 1 and Note 3 to the financial statements
Critical Audit Matter Description
−Removed: The Company performs an impairment analysis of properties which begins with an evaluation of events or changes in circumstances that may indicate that the carrying value may not be recoverable, such as a significant decline in occupancy, identification of materially adverse legal or environmental factors, a change in the designation of an asset from core to non-core, which may impact the anticipated holding period, or a decline in market value to an amount less than cost.
+Added: The Company performs an impairment analysis of properties which begins with an evaluation of events or changes in circumstances that may indicate that the carrying value may not be recoverable, such as a significant decline in occupancy, identification of materially adverse legal or environmental factors, a change in the designation of an asset from core to non-core, which may impact the anticipated holding period, or a decline in market value to an amount less than carrying value.
When events or changes in circumstances indicate that the carrying value may not be recoverable, the Company evaluates its real estate assets for impairment by comparing undiscounted future cash flows expected to be generated over the estimated hold period of each asset to the respective carrying amount.
2 unchanged sentences
Changes in those judgments could have a material impact on the real estate assets that are identified for further analysis.
−Removed: For those real estate assets where an indicator has been identified, the Company makes significant estimates and assumptions to determine the recoverability using undiscounted future cash flows expected to be generated over the estimated hold period of the asset, including estimates and assumptions related to the rental rates, growth rates, and capitalization rates.
−Removed: For those real estate assets where impairment has been identified, the Company applies a discount rate to those undiscounted cash flows to determine fair value.
−Removed: Total real estate assets as of December 31, 2022, were $5.1 billion, net of impairment losses recorded in 2022 of $35 million.
+Added: Given (1) the Company’s evaluation of possible indications of impairment of real estate assets requires management to make judgments, and (2), the undiscounted estimated future operating and residual cash flows to determine recoverability require management to make significant estimates and assumptions related to current and projected trends in rental, occupancy, capitalization rates and estimated hold periods, performing audit procedures to evaluate (a) whether management appropriately identified events or changes in circumstances indicating that the carrying amounts of real estate assets may not be recoverable and (b) the reasonableness of managements undiscounted future cash flow analysis, required a high degree of auditor judgment and an increased extent of effort.
How the Critical Audit Matter Was Addressed in the Audit
−Removed: Our audit procedures related to the evaluation of real estate assets for possible indications of impairment included the following, among others:
−Removed: • We tested the effectiveness of controls over management’s identification of possible circumstances that may indicate that the carrying amounts of real estate assets are no longer recoverable, including controls over management’s designation of an asset as core or non-core, occupancy and management’s estimates of fair values.
+Added: Our audit procedures related to the evaluation of real estate assets for possible indications of impairment and our procedures related to the undiscounted estimated future operating and residual cash flows to determine recoverability, included the following, among others:
+Added: • We tested the effectiveness of controls over management’s identification of possible circumstances that may indicate that the carrying amounts of real estate assets are no longer recoverable, including controls over management’s designation of an asset as core or non-core, occupancy and management’s controls over undiscounted estimated future operating and residual cash flows to determine recoverability.
• We evaluated management’s identification of impairment indicators by developing an independent determination if properties exhibit an indicator of impairment by:
1 unchanged sentence
– Testing real estate assets for possible indications of impairment, including searching for adverse asset-specific circumstances and/or market conditions by reviewing questionnaires to regional property managers and using reputable market surveys.
−Removed: – With the assistance of our fair value specialists, developing an independent expectation of impairment indicators and comparing such expectation to management’s analysis.
−Removed: • We evaluated the Company’s undiscounted cash flows prepared when an indicator of impairment has been identified by performing the following:
−Removed: – We evaluated the reasonableness of the valuation methodology as well as significant assumptions used in the undiscounted recoverability models, including the rental rates, growth rates, and capitalization rates.
−Removed: • We evaluated the Company’s determination of fair value for those assets where impairment had been identified by performing the following:
−Removed: – We evaluated the reasonableness of the valuation methodology as well as significant assumptions used in fair value model, including the growth rates.
−Removed: With the assistance of our fair value specialists, we also evaluated the reasonableness of the discount rate, rental rates, and capitalization rate assumptions.
+Added: – Developing an independent expectation of impairment indicators and comparing such expectation to management’s analysis.
+Added: • We evaluated the Company’s determination of the undiscounted estimated future operating and residual cash flows to determine recoverability for those assets where an indicator had been identified by performing the following:
+Added: – Comparing the projections included in management’s cash flow estimates to determine recoverability to the Company’s historical results and external market sources.
+Added: – We evaluated the reasonableness of the significant assumptions used in the undiscounted estimated future operating and residual cash flows, including the estimated hold period, rental rates, growth rates, and capitalization rate assumptions.
/s/ Deloitte & Touche LLP
14 unchanged sentences
Net real estate assets 4,993,531 5,126,925
−Removed: Real estate and other assets, net, held for sale — 3,518
Cash and cash equivalents 25,123 21,357
16 unchanged sentences
Preferred Stock, $ 0.01 par value, 50,000,000 authorized shares;
−Removed: 8.625 % Series A Cumulative Redeemable Preferred Shares (liquidation preference $ 1,000 per share), 28,821 shares issued and outstanding
+Added: 8.625 % Series A Cumulative Redeemable Preferred Shares (liquidation preference $ 1,000 per share), 28,811 and 28,821 shares issued and outstanding
28,811 28,821
23 unchanged sentences
Interest expense 136,710 105,385 85,853
−Removed: Other income/(loss) 1,530 1,394 ( 1,707 )
+Added: Other income 4,435 1,530 1,394
Gains on disposition of property 47,773 63,546 174,059
+Added: Gain on deconsolidation of affiliate 11,778 — —
Equity in earnings of unconsolidated affiliates 1,107 1,535 1,947
1 unchanged sentence
Net (income) attributable to noncontrolling interests in the Operating Partnership ( 3,164 ) ( 3,670 ) ( 8,321 )
−Removed: Net (income) attributable to noncontrolling interests in consolidated affiliates ( 1,230 ) ( 1,712 ) ( 1,174 )
+Added: Net (income)/loss attributable to noncontrolling interests in consolidated affiliates 549 ( 1,230 ) ( 1,712 )
Dividends on Preferred Stock ( 2,485 ) ( 2,486 ) ( 2,486 )
16 unchanged sentences
Other comprehensive income/(loss):
+Added: Settlement of cash flow hedges ( 493 ) — —
Unrealized losses on cash flow hedges — — ( 19 )
25 unchanged sentences
Net income — — — — — 323,310 323,310
−Removed: Other comprehensive loss — — — ( 991 ) — — ( 991 )
+Added: Other comprehensive income — — — 489 — — 489
Total comprehensive income 323,799
9 unchanged sentences
Issuances of restricted stock 181,807 — — — — — — —
−Removed: Redemptions/repurchases of Preferred Stock
−Removed: — ( 5 ) — — — — ( 5 )
Share-based compensation expense, net of forfeitures
3 unchanged sentences
Net (income) attributable to noncontrolling interests in consolidated affiliates — — — — 1,230 ( 1,230 ) —
−Removed: — — — — 1,712 ( 1,712 ) —
Comprehensive income:
Net income — — — — — 163,958 163,958
−Removed: Other comprehensive income — — — 489 — — 489
+Added: Other comprehensive loss — — — ( 238 ) — — ( 238 )
Total comprehensive income 163,720
15 unchanged sentences
— — 10,152 — — — 10,152
−Removed: Distributions to noncontrolling interests in consolidated affiliates
+Added: Contributions from noncontrolling interests in consolidated affiliates
— — — — 320 — 320
1 unchanged sentence
282,453 — — — — — — —
+Added: Redemptions/repurchases of Preferred Stock
+Added: — ( 10 ) — — — — ( 10 )
Share-based compensation expense, net of forfeitures
2 unchanged sentences
— — — — — ( 3,164 ) ( 3,164 )
−Removed: Net (income) attributable to noncontrolling interests in consolidated affiliates
−Removed: — — — — 1,230 ( 1,230 ) —
+Added: Net loss attributable to noncontrolling interests in consolidated affiliates — — — — ( 549 ) 549 —
+Added: Deconsolidation of affiliate — — — — ( 17,281 ) — ( 17,281 )
Comprehensive income:
24 unchanged sentences
Net gains on disposition of property ( 47,773 ) ( 63,546 ) ( 174,059 )
+Added: Gain on deconsolidation of affiliate ( 11,778 ) — —
Equity in earnings of unconsolidated affiliates ( 1,107 ) ( 1,535 ) ( 1,947 )
Distributions of earnings from unconsolidated affiliates 1,246 614 1,417
+Added: Settlement of cash flow hedges ( 493 ) — —
Changes in operating assets and liabilities:
15 unchanged sentences
Investments in and advances to unconsolidated affiliates ( 132,609 ) ( 261,772 ) ( 6,079 )
−Removed: Payments of earnest money deposits ( 15,500 ) — —
+Added: Repayments of preferred equity from unconsolidated affiliates 80,000 — —
+Added: Changes in earnest money deposits 15,500 ( 15,500 ) —
Changes in other investing activities ( 7,431 ) ( 1,389 ) ( 3,289 )
−Removed: Net cash provided by/(used in) investing activities $ ( 614,799 ) $ ( 287,678 ) $ 110,682
+Added: Net cash used in investing activities $ ( 169,686 ) $ ( 614,799 ) $ ( 287,678 )
Table on Contents
18 unchanged sentences
Repayments of mortgages and notes payable ( 206,726 ) ( 456,444 ) ( 353,780 )
−Removed: Payments of debt extinguishment costs — — ( 3,193 )
+Added: Contributions from noncontrolling interests in consolidated affiliates 320 — —
Payments for debt issuance costs and other financing activities ( 5,370 ) ( 4,087 ) ( 9,279 )
1 unchanged sentence
Net increase/(decrease) in cash and cash equivalents and restricted cash 11,850 ( 5,093 ) ( 158,046 )
+Added: Cash from deconsolidation of affiliate ( 6,386 ) — —
Cash and cash equivalents and restricted cash at beginning of the period 26,105 31,198 189,244
13 unchanged sentences
2023 2022 2021
−Removed: Unrealized losses on cash flow hedges $ — $ ( 19 ) $ ( 1,238 )
Conversions of Common Units to Common Stock 4,795 1,251 15,076
6 unchanged sentences
Assumption of mortgages and notes payable related to acquisition activities — — 403,000
−Removed: Issuances of Common Units to acquire real estate assets — — 6,163
Initial recognition of lease liabilities related to right of use assets — — 5,310
24 unchanged sentences
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 a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
−Removed: Impairment of Real Estate Assets—Refer to Note 1 and Note 3 to the financial statements
+Added: Real Estate Assets - Determination of Impairment Indicators and Impairment—Refer to Note 1 and Note 3 to the financial statements
Critical Audit Matter Description
−Removed: The Operating Partnership performs an impairment analysis of properties which begins with an evaluation of events or changes in circumstances that may indicate that the carrying value may not be recoverable, such as a significant decline in occupancy, identification of materially adverse legal or environmental factors, a change in the designation of an asset from core to non-core, which may impact the anticipated holding period, or a decline in market value to an amount less than cost.
+Added: The Operating Partnership performs an impairment analysis of properties which begins with an evaluation of events or changes in circumstances that may indicate that the carrying value may not be recoverable, such as a significant decline in occupancy, identification of materially adverse legal or environmental factors, a change in the designation of an asset from core to non-core, which may impact the anticipated holding period, or a decline in market value to an amount less than carrying value.
When events or changes in circumstances indicate that the carrying value may not be recoverable, the Operating Partnership evaluates its real estate assets for impairment by comparing undiscounted future cash flows expected to be generated over the estimated hold period of each asset to the respective carrying amount.
2 unchanged sentences
Changes in those judgments could have a material impact on the real estate assets that are identified for further analysis.
−Removed: For those real estate assets where an indicator has been identified, the Operating Partnership makes significant estimates and assumptions to determine the recoverability using undiscounted future cash flows expected to be generated over the estimated hold period of the asset, including estimates and assumptions related to the rental rates, growth rates, and capitalization rates.
−Removed: For those real estate assets where impairment has been identified, the Operating Partnership applies a discount rate to those undiscounted cash flows to determine fair value.
−Removed: Total real estate assets as of December 31, 2022, were $5.1 billion, net of impairment losses recorded in 2022 of $35 million.
+Added: Given (1) the Operating Partnership’s evaluation of possible indications of impairment of real estate assets requires management to make judgments, and (2), the undiscounted estimated future operating and residual cash flows to determine recoverability require management to make significant estimates and assumptions related to current and projected trends in rental, occupancy, capitalization rates and estimated hold periods, performing audit procedures to evaluate (a) whether management appropriately identified events or changes in circumstances indicating that the carrying amounts of real estate assets may not be recoverable and (b) the reasonableness of managements undiscounted future cash flow analysis, required a high degree of auditor judgment and an increased extent of effort.
How the Critical Audit Matter Was Addressed in the Audit
−Removed: Our audit procedures related to the evaluation of real estate assets for possible indications of impairment included the following, among others:
−Removed: • We tested the effectiveness of controls over management’s identification of possible circumstances that may indicate that the carrying amounts of real estate assets are no longer recoverable, including controls over management’s designation of an asset as core or non-core, occupancy, and management’s estimates of fair values.
+Added: Our audit procedures related to the evaluation of real estate assets for possible indications of impairment and our procedures related to the undiscounted estimated future operating and residual cash flows to determine recoverability, included the following, among others:
+Added: • We tested the effectiveness of controls over management’s identification of possible circumstances that may indicate that the carrying amounts of real estate assets are no longer recoverable, including controls over management’s designation of an asset as core or non-core, occupancy and management’s controls over undiscounted estimated future operating and residual cash flows to determine recoverability.
• We evaluated management’s identification of impairment indicators by developing an independent determination if properties exhibit an indicator of impairment by:
1 unchanged sentence
– Testing real estate assets for possible indications of impairment, including searching for adverse asset-specific circumstances and/or market conditions by reviewing questionnaires to regional property managers and using reputable market surveys.
−Removed: – With the assistance of our fair value specialists, developing an independent expectation of impairment indicators and comparing such expectation to management’s analysis.
−Removed: • We evaluated the Operating Partnership’s undiscounted cash flows prepared when an indicator of impairment has been identified by performing the following:
−Removed: – We evaluated the reasonableness of the valuation methodology as well as significant assumptions used in the undiscounted recoverability models, including the rental rates, growth rates, and capitalization rates.
−Removed: • We evaluated the Operating Partnership’s determination of fair value for those assets where impairment had been identified by performing the following:
−Removed: – We evaluated the reasonableness of the valuation methodology as well as significant assumptions used in the fair value model, including the growth rates.
−Removed: With the assistance of our fair value specialists, we also evaluated the reasonableness of the discount rate, rental rates, and capitalization rate assumptions.
+Added: – Developing an independent expectation of impairment indicators and comparing such expectation to management’s analysis.
+Added: • We evaluated the Operating Partnership’s determination of the undiscounted estimated future operating and residual cash flows to determine recoverability for those assets where an indicator had been identified by performing the following:
+Added: – Comparing the projections included in management’s cash flow estimates to determine recoverability to the Operating Partnership’s historical results and external market sources.
+Added: – We evaluated the reasonableness of the significant assumptions used in the undiscounted estimated future operating and residual cash flows, including the estimated hold period, rental rates, growth rates, and capitalization rate assumptions.
/s/ Deloitte & Touche LLP
13 unchanged sentences
Net real estate assets 4,993,531 5,126,925
−Removed: Real estate and other assets, net, held for sale — 3,518
Cash and cash equivalents 25,123 21,357
17 unchanged sentences
49,520 65,977
−Removed: Series A Preferred Units (liquidation preference $ 1,000 per unit), 28,821 units issued and outstanding
+Added: Series A Preferred Units (liquidation preference $ 1,000 per unit), 28,811 and 28,821 units issued and outstanding
28,811 28,821
23 unchanged sentences
Interest expense 136,710 105,385 85,853
−Removed: Other income/(loss) 1,530 1,394 ( 1,707 )
+Added: Other income 4,435 1,530 1,394
Gains on disposition of property 47,773 63,546 174,059
+Added: Gain on deconsolidation of affiliate 11,778 — —
Equity in earnings of unconsolidated affiliates 1,107 1,535 1,947
Net income 151,330 163,958 323,310
−Removed: Net (income) attributable to noncontrolling interests in consolidated affiliates ( 1,230 ) ( 1,712 ) ( 1,174 )
+Added: Net (income)/loss attributable to noncontrolling interests in consolidated affiliates 549 ( 1,230 ) ( 1,712 )
Distributions on Preferred Units ( 2,485 ) ( 2,486 ) ( 2,486 )
15 unchanged sentences
Other comprehensive income/(loss):
+Added: Settlement of cash flow hedges ( 493 ) — —
Unrealized losses on cash flow hedges — — ( 19 )
2 unchanged sentences
Total comprehensive income 150,544 163,720 323,799
−Removed: Less-comprehensive (income) attributable to noncontrolling interests ( 1,230 ) ( 1,712 ) ( 1,174 )
+Added: Less-comprehensive (income)/loss attributable to noncontrolling interests 549 ( 1,230 ) ( 1,712 )
Comprehensive income attributable to common unitholders $ 151,093 $ 162,490 $ 322,087
18 unchanged sentences
Adjustment of Redeemable Common Units to fair value and contributions/distributions from/to the General Partner
−Removed: 199 19,733 — — 19,932
Net (income) attributable to noncontrolling interests in consolidated affiliates
2 unchanged sentences
Net income 3,233 320,077 — — 323,310
−Removed: Other comprehensive loss — — ( 991 ) — ( 991 )
+Added: Other comprehensive income — — 489 — 489
Total comprehensive income 323,799
2 unchanged sentences
52 5,115 — — 5,167
+Added: Redemptions of Common Units
+Added: ( 38 ) ( 3,725 ) — — ( 3,763 )
Distributions on Common Units ($ 2.00 per unit)
6 unchanged sentences
Adjustment of Redeemable Common Units to fair value and contributions/distributions from/to the General Partner
+Added: 449 44,445 — — 44,894
Net (income) attributable to noncontrolling interests in consolidated affiliates
2 unchanged sentences
Net income 1,640 162,318 — — 163,958
−Removed: Other comprehensive income — — 489 — 489
+Added: Other comprehensive loss — — ( 238 ) — ( 238 )
Total comprehensive income 163,720
3 unchanged sentences
Redemptions of Common Units
+Added: ( 2 ) ( 161 ) — — ( 163 )
Distributions on Common Units ($ 2.00 per unit)
3 unchanged sentences
Share-based compensation expense, net of forfeitures 70 6,914 — — 6,984
−Removed: Distributions to noncontrolling interests in consolidated affiliates
+Added: Contributions from noncontrolling interests in consolidated affiliates
— — — 320 320
1 unchanged sentence
156 15,483 — — 15,639
−Removed: Net (income) attributable to noncontrolling interests in consolidated affiliates
−Removed: ( 12 ) ( 1,218 ) — 1,230 —
+Added: Net loss attributable to noncontrolling interests in consolidated affiliates 5 544 — ( 549 ) —
+Added: Deconsolidation of affiliate — — — ( 17,281 ) ( 17,281 )
Comprehensive income:
23 unchanged sentences
Net gains on disposition of property ( 47,773 ) ( 63,546 ) ( 174,059 )
+Added: Gain on deconsolidation of affiliate ( 11,778 ) — —
Equity in earnings of unconsolidated affiliates ( 1,107 ) ( 1,535 ) ( 1,947 )
Distributions of earnings from unconsolidated affiliates 1,246 614 1,417
+Added: Settlement of cash flow hedges ( 493 ) — —
Changes in operating assets and liabilities:
15 unchanged sentences
Investments in and advances to unconsolidated affiliates ( 132,609 ) ( 261,772 ) ( 6,079 )
−Removed: Payments of earnest money deposits ( 15,500 ) — —
+Added: Repayments of preferred equity from unconsolidated affiliates 80,000 — —
+Added: Changes in earnest money deposits 15,500 ( 15,500 ) —
Changes in other investing activities ( 7,431 ) ( 1,389 ) ( 3,289 )
−Removed: Net cash provided by/(used in) investing activities $ ( 614,799 ) $ ( 287,678 ) $ 110,682
+Added: Net cash used in investing activities $ ( 169,686 ) $ ( 614,799 ) $ ( 287,678 )
HIGHWOODS REALTY LIMITED PARTNERSHIP
16 unchanged sentences
Repayments of mortgages and notes payable ( 206,726 ) ( 456,444 ) ( 353,780 )
−Removed: Payments of debt extinguishment costs — — ( 3,193 )
+Added: Contributions from noncontrolling interests in consolidated affiliates 320 — —
Payments for debt issuance costs and other financing activities ( 6,188 ) ( 4,905 ) ( 10,081 )
1 unchanged sentence
Net increase/(decrease) in cash and cash equivalents and restricted cash 11,850 ( 5,093 ) ( 158,046 )
+Added: Cash from deconsolidation of affiliate ( 6,386 ) — —
Cash and cash equivalents and restricted cash at beginning of the period 26,105 31,198 189,244
13 unchanged sentences
2023 2022 2021
−Removed: Unrealized losses on cash flow hedges $ — $ ( 19 ) $ ( 1,238 )
Changes in accrued capital expenditures (1)
5 unchanged sentences
Assumption of mortgages and notes payable related to acquisition activities — — 403,000
−Removed: Issuances of Common Units to acquire real estate assets — — 6,163
Initial recognition of lease liabilities related to right of use assets — — 5,310
17 unchanged sentences
In the event the Company issues shares of Common Stock, the net proceeds of the issuance are contributed to the Operating Partnership in exchange for additional Common Units.
−Removed: Generally, the Operating Partnership is obligated to redeem each Common Unit at the request of the holder thereof for cash equal to the value of one share of Common Stock based on the average of the market price for the 10 trading days immediately preceding the notice date of such redemption, provided that the Company, at its option, may elect to acquire any such Common Units presented for redemption for cash or one share of Common Stock.
+Added: Generally, the Operating Partnership is obligated to redeem each Common Unit at the request of the unitholder for cash equal to the value of one share of Common Stock based on the average of the market price for the 10 trading days immediately preceding the notice date of such redemption, provided that the Company, at its option, may elect to acquire any such Common Units presented for redemption for cash or one share of Common Stock.
The Common Units owned by the Company are not redeemable.
During 2023, the Company redeemed 193,907 Common Units for a like number of shares of Common Stock and 7,294 Common Units for cash.
−Removed: These redemptions, in conjunction with the proceeds from issuances of Common Stock (see Note 10), increased the percentage of Common Units owned by the Company from 97.7 % as of December 31, 2021 to 97.8 % as of December 31, 2022.
+Added: These redemptions increased the percentage of Common Units owned by the Company from 97.8 % as of December 31, 2022 to 98.0 % as of December 31, 2023.
Basis of Presentation
4 unchanged sentences
In addition, we consolidate those entities deemed to be variable interest entities in which we are determined to be the primary beneficiary.
−Removed: During 2022, we acquired an office building using a special purpose entity owned by a qualified intermediary to facilitate one or more potential Section 1031 reverse exchanges under the Internal Revenue Code.
−Removed: To realize the tax deferrals available under the Section 1031 exchanges, we must complete the Section 1031 exchanges and take title to the to-be-exchanged buildings within 180 days of the acquisition date.
−Removed: We have determined that this entity is a variable interest entity of which we are the primary beneficiary;
−Removed: therefore, we consolidate this entity.
−Removed: As of December 31, 2022, we also have involvement with six additional entities we determined to be variable interest entities, one of which we are the primary beneficiary and is consolidated and five of which we are not the primary beneficiary and are not consolidated.
−Removed: We also owned three properties through a joint venture investment as of December 31, 2022 that were consolidated.
−Removed: (See Note 4).
+Added: As of December 31, 2023, we are involved with six entities we determined to be variable interest entities, one of which we are the primary beneficiary and is consolidated and five of which we are not the primary beneficiary and are not consolidated.
+Added: We also own three properties through a joint venture investment that were deconsolidated effective January 1, 2023 (see Note 4).
All intercompany transactions and accounts have been eliminated.
11 unchanged sentences
Depreciation is computed using the straight-line method over the estimated useful life of 40 years for buildings and depreciable land infrastructure costs, 15 years for building improvements and five to seven years for furniture, fixtures and equipment.
−Removed: Tenant improvements are amortized using the straight-line method over the initial fixed terms of the respective leases, which generally are from three to 10 years.
+Added: Tenant improvements are amortized using the straight-line method over the initial fixed terms of the respective leases, which generally range from three to 10 years.
Depreciation expense for real estate assets was $ 253.2 million, $ 240.3 million and $ 218.6 million for the years ended December 31, 2023, 2022 and 2021, respectively.
−Removed: Expenditures directly related to the development and construction of real estate assets are included in net real estate assets and are stated at depreciated cost.
+Added: Expenditures directly related to the development and construction of real estate assets are included in net real estate assets and stated at depreciated cost.
Development expenditures include pre-construction costs essential to the development of properties, development and construction costs, interest costs on qualifying assets, real estate taxes, development personnel salaries and related costs and other costs incurred during the period of development.
24 unchanged sentences
In some instances, appraisal information may be available and is used in addition to a discounted cash flow analysis.
−Removed: As the factors used in generating these cash flows are difficult to predict and are subject to future events that may alter our assumptions, the discounted and/or undiscounted future operating and residual cash flows estimated by us in our impairment analyses or those established by appraisal may not be achieved and we may be required to recognize future impairment losses on properties held for use.
+Added: As the factors used in generating these cash flows are difficult to predict and subject to future events that may alter our assumptions, the discounted and/or undiscounted future operating and residual cash flows estimated by us in our impairment analyses or those established by appraisal may not be achieved and we may be required to recognize future impairment losses on properties held for use.
We record assets held for sale at the lower of the carrying amount or estimated fair value.
3 unchanged sentences
This analysis consists of determining whether an expected loss in market value of an investment is other than temporary by evaluating the length of time and the extent to which the market value has been less than cost, the financial condition and near-term prospects of the investment, and our intent and ability to retain our investment for a period of time sufficient to allow for any anticipated recovery in market value.
−Removed: As the factors used in this analysis are difficult to predict and are subject to future events that may alter our assumptions, we may be required to recognize future impairment losses on our investments in unconsolidated affiliates.
+Added: As the factors used in this analysis are difficult to predict and subject to future events that may alter our assumptions, we may be required to recognize future impairment losses on our investments in unconsolidated affiliates.
Sales of Real Estate
−Removed: For sales of real estate where we have collected the consideration to which we are entitled in exchange for transferring the real estate, the related assets and liabilities are removed from the balance sheet and the resultant gain or loss is recorded in the period the transaction closes.
−Removed: Any post-sale involvement is accounted for as separate performance obligations and when the separate performance obligations are satisfied, the sales price allocated to each is recognized.
+Added: For sales of real estate where we have determined an enforceable contract exists and collection of the consideration to which we are entitled in exchange for transferring the real estate is probable, the related assets and liabilities are removed from the balance sheet and the resultant gain or loss is recorded in the period the transaction closes.
+Added: Any post-sale involvement is accounted for as a separate performance obligation and the allocable sales price is recognized when the separate performance obligation is satisfied.
We generally lease our office properties to lessees in exchange for fixed monthly payments that cover rent, property taxes, insurance and certain cost recoveries, primarily common area maintenance (“CAM”).
−Removed: Office properties owned by us that are under lease are primarily located in Atlanta, Charlotte, Dallas, Nashville, Orlando, Raleigh, Richmond and Tampa and are leased to a wide variety of lessees across many industries.
+Added: Our office properties that are under lease are primarily located in Atlanta, Charlotte, Dallas, Nashville, Orlando, Raleigh, Richmond and Tampa and are leased to a wide variety of lessees across many industries.
Our leases are operating leases and mostly range from three to 10 years.
2 unchanged sentences
As such, consideration for CAM is accounted for as part of the overall consideration in the lease.
−Removed: Payments from customers for property taxes and insurance are considered noncomponents of the lease and therefore no consideration is allocated to them
−Removed: because they do not transfer a good or service to the customer.
+Added: Payments from customers for property taxes and insurance are considered noncomponents of the lease and therefore no consideration is allocated to them because they do not transfer a good or service to the customer.
Fixed contractual payments from our leases are recognized on a straight-line basis over the terms of the respective leases.
1 unchanged sentence
Straight-line rental revenue is commenced when the customer assumes control of the leased premises.
−Removed: Accrued straight-line rents receivable represents the amount by which straight-line rental revenue exceeds rents currently billed in accordance with lease agreements.
+Added: Accrued straight-
+Added: line rents receivable represents the amount by which straight-line rental revenue exceeds rents currently billed in accordance with lease agreements.
Some of our leases are subject to annual changes in the Consumer Price Index (“CPI”).
Although increases in the CPI are not estimated as part of our measurement of straight-line rental revenue, to the extent that actual CPI is greater or less than the CPI at lease commencement, the amount of rent recognized in a given year is affected accordingly.
−Removed: Some of our leases have termination options and/or extension options.
+Added: Some of our leases have termination and/or extension options.
Termination options allow the customer to terminate the lease prior to the end of the lease term under certain circumstances.
−Removed: Termination options generally become effective half way or further into the original lease term and require advance notification from the customer and payment of a termination fee that reimburses us for a portion of the remaining rent under the original lease term and the undepreciated lease inception costs such as commissions, tenant improvements and lease incentives.
+Added: Termination options generally become effective halfway or further into the original lease term and require advance notification from the customer and payment of a termination fee that reimburses us for a portion of the remaining rent under the original lease term and the undepreciated lease inception costs such as commissions, tenant improvements and lease incentives.
Termination fee income is recognized on a straight-line basis from the date of the executed termination agreement through lease expiration when the amount of the fee is determinable and collectability of the fee is reasonably assured.
1 unchanged sentence
Initial direct costs, primarily commissions, related to the leasing of our office properties are included in deferred leasing costs and are stated at amortized cost.
−Removed: Such expenditures are part of the investment necessary to execute leases and, therefore, are classified as investment activities in the statement of cash flows.
+Added: Such expenditures are part of the investment necessary to execute leases and are, therefore, classified as investment activities in the statement of cash flows.
All leasing commissions paid to third parties and our in-house personnel for new leases or lease renewals are capitalized.
35 unchanged sentences
As of December 31, 2023, our consolidated properties were leased to approximately 1,500 customers.
−Removed: The geographic locations that comprise greater than 10.0 % of our rental and other revenues are Atlanta, Nashville, Raleigh and Tampa.
+Added: The geographic locations that comprise greater than 10.0 % of our rental and other revenues are Atlanta, Charlotte, Nashville, Raleigh and Tampa .
Our customers engage in a wide variety of businesses.
7 unchanged sentences
Our long-term debt, which consists of secured and unsecured long-term financings, typically bears interest at fixed rates.
−Removed: Our interest rate risk management objectives are to limit generally the impact of interest rate changes on earnings and cash flows and lower our overall borrowing costs.
+Added: Our interest rate risk management objectives are to generally limit the impact of interest rate changes on earnings and cash flows and lower our overall borrowing costs.
To achieve these objectives, from time to time, we enter into interest rate hedge contracts such as collars, swaps, caps and treasury lock agreements in order to mitigate our interest rate risk with respect to existing and prospective debt instruments.
13 unchanged sentences
Recently Issued Accounting Standards
−Removed: The Financial Accounting Standards Board (“FASB”) issued an accounting standards update (“ASU”) that provides temporary optional expedients and exceptions to the guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from LIBOR and other interbank offered rates to alternative reference rates, such as the Secured Overnight Financing Rate (“SOFR”).
−Removed: Entities can elect not to apply certain modification accounting requirements to contracts affected by reference rate reform, if certain criteria are met.
−Removed: An entity that makes this election would not have to remeasure the contracts at the modification date or reassess a previous accounting determination.
−Removed: Entities can also elect various optional expedients that would allow them to continue applying hedge accounting for hedging relationships affected by reference rate reform, if certain criteria are met.
−Removed: The guidance in this ASU is optional and may be elected now through December 31, 2024 as reference rate reform activities occur.
−Removed: We will continue to evaluate the impact of this ASU;
−Removed: however, we currently expect to avail ourselves of such optional expedients and exceptions should our modified contracts meet the required criteria.
+Added: The Financial Accounting Standards Board (“FASB”) issued an accounting standards update (“ASU”) that provides temporary optional expedients and exceptions to ease the financial reporting burdens related to the market transition from LIBOR and other interbank offered rates to alternative reference rates, such as the Secured Overnight Financing Rate (“SOFR”).
+Added: These optional expedients and exceptions provide guidance on contract modifications and hedge accounting.
+Added: We have completed the transition to SOFR rates for our applicable outstanding debt instruments with no material impact to our Consolidated Financial Statements.
+Added: The FASB issued an ASU that will require enhanced segment disclosures, primarily regarding significant segment expenses.
+Added: The ASU is required to be adopted in our 2024 Annual Report and applied retrospectively to all prior periods presented in the financial statements.
+Added: We do not expect such adoption to have a material effect on our Notes to Consolidated Financial Statements.
Information as Lessor
8 unchanged sentences
Changes in the CPI are not estimated as part of our measurement of straight-line rental expense.
−Removed: Upon initial adoption of ASC 842, we recognized a lease liability of $ 35.3 million ( in accounts payable, accrued expenses and other liabilities ) and a related right of use asset of $ 29.7 million ( in prepaid expenses and other assets ) on our Consolidated Balance Sheets equal to the present value of the minimum lease payments required under each ground lease.
+Added: Upon initial adoption of Accounting Standards Codification (“ASC”) 842, we recognized a lease liability of $ 35.3 million ( in accounts payable, accrued expenses and other liabilities ) and a related right of use asset of $ 29.7 million ( in prepaid expenses and other assets ) on our Consolidated Balance Sheets equal to the present value of the minimum lease payments required under each ground lease.
The difference between the recorded lease liability and right of use asset represents the accrued straight-line rent liability previously recognized under ASC 840.
−Removed: We used a discount rate of approximately 4.5 %, which was derived from our assessment of the credit quality of the Company and adjusted to reflect secured borrowing, estimated yield curves and long-term spread adjustments over appropriate tenors.
+Added: We used a discount rate of approximately 4.5 %, which was derived from our assessment of the credit quality of the Company and adjusted to reflect secured borrowing, estimated yield curves and long-term spread adjustments over appropriate tenors at the time of adoption.
Some of our ground leases contain extension options.
14 unchanged sentences
Through October 31, 2029, the expected date at which we estimate we will satisfy the obligation and acquire fee simple title to the land, we will recognize interest expense equal to the lease liability times our incremental borrowing rate, which reflects the fixed rate at which we could borrow a similar amount for the same term and with similar collateral.
−Removed: We determined this rate to be approximately 2.6 %.
+Added: We determined this rate to be approximately 2.6 % at the time of acquisition.
We also recorded an additional $ 3.1 million right of use asset ( in prepaid expenses and other assets ) to reflect favorable terms of the ground lease when compared with market terms.
1 unchanged sentence
Real Estate Assets
+Added: During 2023, we acquired land in Raleigh for a purchase price, including capitalized acquisition costs, of $ 2.7 million.
During 2022, we acquired SIX50 at Legacy Union, a 367,000 square foot trophy office building in Charlotte’s Uptown CBD submarket, for a net purchase price of $ 198.0 million.
22 unchanged sentences
(1) Included in purchase price.
−Removed: During 2021, we also acquired various development land parcels in Nashville for an aggregate purchase price, including capitalized acquisition costs, of $ 74.1 million.
−Removed: The $ 16.0 million purchase price for one of the acquired parcels is expected to be paid in or prior to second quarter 2023, and $ 15.5 million of this amount had been paid as of December 31, 2022 .
−Removed: Duri ng 2021, we also acquired our joint venture partner’s 75.0 % interest in our Highwoods DLF Forum, LLC joint venture (the “Forum”), which owned five buildings in Raleigh encompassing 636,000 rentable square feet, for a purchase price of $ 131.3 million.
+Added: During 2021, we acquired various development land parcels in Nashville for an aggregate purchase price, including capitalized acquisition costs, of $ 74.1 million.
+Added: The $ 16.0 million purchase price for one of the acquired parcels was fully paid in or prior to the second quarter of 2023.
+Added: Duri ng 2021, we also acquired our joint venture partner’s 75.0 % interest in our Highwoods DLF Forum, LLC joint venture (the “Forum”), which owned five buildings in Raleigh encompassing 636,000 rentable square feet, for a purchase price of
+Added: $ 131.3 million.
We previously accounted for our 25.0 % interest in this joint venture using the equity method of accounting.
−Removed: The assets and liabilities of the joint venture are now wholly owned and we have determined the acquisition constitutes an asset
+Added: The assets and liabilities of the joint venture are now wholly owned and we have determined the acquisition constitutes an asset purchase.
As such, because the Forum is not a variable interest entity, we allocated our previously held equity interest at historical cost along with the consideration paid and acquisition costs to the assets acquired and liabilities assumed.
The assets acquired and liabilities assumed were recorded at relative fair value as determined by management, with the assistance of third party specialists, based on information available at the acquisition date and on current assumptions as to future operations.
−Removed: During 2020, we acquired two development land parcels totaling less than one acre in Raleigh and Nashville for an aggregate purchase price of $ 8.5 million, including the issuance of 118,592 Common Units and capitalized acquisition costs.
+Added: During 2023, we sold a total of four buildings and various land parcels in Nashville, Raleigh and Tampa for an aggregate sales price of $ 103.8 million and recorded aggregate gains on disposition of property of $ 47.8 million.
During 2022, we sold a total of five office buildings and various land parcels in Atlanta, Greensboro, Richmond and Tampa for an aggregate sales price of $ 133.5 million (before closing credits to buyers of $ 1.1 million) and recorded aggregate gains on disposition of property of $ 63.5 million.
During 2021, we sold a total of 13 office buildings and various land parcels in Atlanta, Memphis, Raleigh, Richmond and Tampa for an aggregate sales price of $ 384.6 million (before closing credits to buyers of $ 6.9 million) and recorded aggregate gains on disposition of property of $ 172.8 million.
−Removed: During 2020, we sold a total of 52 buildings in Greensboro and Memphis and various land parcels for an aggregate sales price of $ 494.2 million (before closing credits to buyers of $ 5.7 million) and recorded aggregate gains on disposition of property of $ 215.5 million.
−Removed: During 2020, we also recognized $ 0.4 million of gain related to the satisfaction of a performance obligation as part of a 2016 land sale.
+Added: Seller Financed Transaction
+Added: During 2023, we sold a land parcel in Tampa for an aggregate sales price of $ 21.0 million.
+Added: In connection with this disposition, we received cash of $ 2.0 million and provided $ 19.0 million of non-recourse seller financing in the form of a two-year , interest-only first mortgage that bears interest at SOFR plus 100 basis points.
+Added: We have deemed repayment of the mortgage to be not probable primarily because the seller financing represents a significant portion of the aggregate sales price and, since the seller financing is non-recourse, our only remedy in the event of a default would be to foreclose on the asset.
+Added: As a result, the disposition does not meet the contract criteria to be recognized as a sale.
+Added: Until such time as the contract criteria are met, we will continue to account for the land parcel as land held for development on our Consolidated Balance Sheets, and the mortgage associated with the seller financing will not be recorded on our Consolidated Balance Sheets.
+Added: The cash received at closing is recorded as a nonrefundable deposit in accounts payable, accrued expenses and other liabilities on our Consolidated Balance Sheets as of December 31, 2023.
We recorded the following impairment charges in 2022:
3 unchanged sentences
EQT Corporation’s lease of 317,000 square feet at EQT Plaza is scheduled to expire in September 2024.
−Removed: During 2020, we recorded an impairment of real estate assets of $ 1.8 million, which resulted from a change in market-based inputs and our assumptions about the use of the assets.
Investments in and Advances to Affiliates
4 unchanged sentences
Joint Venture Location Ownership
+Added: Highwoods-Markel Associates, LLC Richmond 50.0 %
Granite Park Six JV, LLC Dallas 50.0 %
5 unchanged sentences
Kessinger/Hunter & Company, LC Kansas City 26.5 %
+Added: - Highwoods-Markel Associates, LLC (“Markel joint venture”)
+Added: In 1999, we formed a joint venture with Markel Corporation in which we own a 50.0 % interest.
+Added: The Markel joint venture was consolidated as of December 31, 2022 because we controlled the major operating and financial policies of the entity.
+Added: Effective January 1, 2023, the agreement governing the joint venture was modified to require the consent of both partners for major operating and financial policies of the entity.
+Added: As a result, the Markel joint venture was deconsolidated effective January 1, 2023, and this joint venture is now accounted for using the equity method of accounting.
+Added: We recognized a gain on deconsolidation of $ 11.8 million related to adjusting our retained interest in the joint venture to fair value.
+Added: The assets of the Markel joint venture can only be used to settle obligations of the joint venture, and its creditors have no recourse to our wholly owned assets.
+Added: During 2021, prior to the deconsolidation, the Markel joint venture sold land in Richmond for a sale price of $ 3.0 million and recorded gain on disposition of property of $ 1.3 million.
- Granite Park Six JV, LLC/ GPI 23 Springs JV, LLC (“Granite Park Six joint venture”/“23Springs joint venture”)
2 unchanged sentences
The Granite Park Six joint venture has an anticipated total investment of $ 200.0 million and the 23Springs joint venture has an anticipated total investment of $ 460.0 million.
−Removed: As of December 31, 2022, we have fully funded our share of the equity for the Granite Park Six joint venture and we have funded $ 41.9 million of our share of the equity for the 23Springs joint venture.
+Added: As of December 31, 2023, we have fully funded our share of the equity for the Granite Park Six joint venture and have funded $ 75.6 million of our share of the equity for the 23Springs joint venture.
The Granite Park Six joint venture obtained a construction loan for $ 115.0 million, with an interest rate of SOFR plus 394 basis points and a maturity date of January 2026.
6 unchanged sentences
As of December 31, 2023, no amounts were drawn on this loan.
+Added: We determined that we have a variable interest in both the Granite Park Six and 23Springs joint ventures primarily because the entities were designed to pass along interest rate risk, equity price risk and operation risk to us and Granite as equity holders.
+Added: The joint ventures were further determined to be variable interest entities as they require additional subordinated financial support in the form of loans because the initial equity investments provided by us and Granite are not sufficient to finance the planned investments and operations.
+Added: We concluded we do not have the power to direct matters that most significantly impact the activities of either entity and therefore do not qualify as the primary beneficiary.
+Added: Accordingly, the entities are not consolidated.
+Added: As of December 31, 2023, our risk of loss with respect to these arrangements was limited to the carrying value of each investment balance.
+Added: Our investment balances were $ 41.9 million and $ 78.7 million as of December 31, 2023 for the Granite Park Six and 23Springs joint ventures, respectively.
+Added: The assets of the Granite Park Six and 23Springs joint ventures can only be used to settle obligations of the respective joint venture, and their creditors have no recourse to our wholly owned assets.
- M+O JV, LLC (“McKinney & Olive joint venture”)
During 2022, we expanded our Dallas market presence by acquiring McKinney & Olive through the formation of another joint venture with Granite in which we own a 50.0 % interest.
−Removed: The McKinney & Olive joint venture has an anticipated total investment of $ 394.7 million, which includes $ 1.7 million of near-term building improvements and $ 2.0 million of transaction costs.
+Added: The McKinney & Olive joint venture has an anticipated total investment of $ 394.7 million.
As part of the transaction, the McKinney & Olive joint venture assumed a secured loan recorded at fair value of $ 137.0 million, with a stated interest rate of 4.5 % and an effective interest rate of 5.3 %, that is scheduled to mature in July 2024.
−Removed: The remainder of the purchase price was funded with $ 80.0 million of short-term preferred equity contributed by us and $ 86.4 million of common equity contributed by each of Granite and us.
−Removed: The preferred equity contributed by us will be entitled to receive monthly distributions initially at a minimum rate of SOFR plus 350 basis points.
+Added: The remainder of the purchase price paid by the McKinney & Olive joint venture was funded with $ 80.0 million of short-term preferred equity contributed by us and $ 86.4 million of common equity contributed by each of Granite and us.
+Added: During 2023, we and Granite each contributed an additional $ 40.0 million of common equity to the McKinney & Olive joint venture.
+Added: Such proceeds were then used by the joint venture to redeem our $ 80.0 million short-term preferred equity investment in full.
+Added: Prior to the redemption, we received monthly distributions on the preferred equity at a rate of SOFR plus 350 basis points.
+Added: We determined that we have a variable interest in the McKinney & Olive joint venture primarily because the entity was designed to pass along interest rate risk, equity price risk and operation risk to us and Granite as equity holders.
+Added: The McKinney & Olive joint venture was further determined to be a variable interest entity as it requires additional subordinated financial support in the form of a loan because the initial equity investments by us and Granite, including the additional preferred equity provided by us, are not sufficient to finance its planned investments and operations.
+Added: We concluded we do not have the power to direct matters that most significantly impact the activities of the entity and therefore do not qualify as the primary beneficiary.
+Added: Accordingly, the entity is not consolidated.
+Added: As of December 31, 2023, our risk of loss with respect to this arrangement was $ 118.6 million, which represents the carrying value of our investment balance.
+Added: The redemption of the preferred equity during 2023 was a reconsideration event that did not change our initial conclusion that the McKinney & Olive joint venture is a variable interest entity of which were are not the primary beneficiary.
+Added: As such, the entity remains unconsolidated.
+Added: The assets of the McKinney & Olive joint venture can only be used to settle obligations of the joint venture, and its creditors have no recourse to our wholly owned assets.
- Midtown East Tampa, LLC (“Midtown East joint venture”)
During 2022, we formed a joint venture with The Bromley Companies (“Bromley”) in which we own a 50.0 % interest to construct Midtown East, a multi-customer office development project located in the mixed-use Midtown Tampa project in Tampa’s Westshore submarket.
−Removed: Upon completion, the Midtown East joint venture will own 143,000 square feet of an overall
−Removed: 432,000 square foot tower.
−Removed: The rest of Midtown East will serve as the future headquarters of Tampa Electric and Peoples Gas.
+Added: Upon completion, the Midtown East joint venture will own 143,000 square feet of an overall 432,000 square foot tower.
+Added: The rest of Midtown East will be owned by and serve as the future headquarters of Tampa Electric and Peoples Gas.
The total anticipated investment for the Midtown East joint venture’s share of the overall project is $ 83.0 million.
3 unchanged sentences
As of December 31, 2023, no amounts were drawn on this loan.
+Added: We determined that we have a variable interest in the Midtown East joint venture primarily because the entity was designed to pass along interest rate risk, equity price risk and operation risk to us, both as a debt and an equity holder, and to Bromley as an equity holder.
+Added: The Midtown East joint venture was further determined to be a variable interest entity as it requires additional subordinated financial support in the form of a loan because the initial equity investments provided by us and Bromley are not sufficient to finance its planned investments and operations.
+Added: We concluded we do not have the power to direct matters that most
+Added: significantly impact the activities of the entity and therefore do not qualify as the primary beneficiary.
+Added: Accordingly, the entity is not consolidated.
+Added: As of December 31, 2023, our risk of loss with respect to this arrangement was limited to the carrying value of the investment balance of $ 13.6 million as no amounts were outstanding under the loan.
+Added: The assets of the Midtown East joint venture can only be used to settle obligations of the joint venture, and its creditors have no recourse to our wholly owned assets.
- Brand/HRLP 2827 Peachtree LLC (“2827 Peachtree joint venture”)
1 unchanged sentence
The 2827 Peachtree joint venture has an anticipated total investment of $ 79.0 million.
−Removed: Construction of 2827 Peachtree began in the first quarter of 2022 with a scheduled completion date in the third quarter of 2023.
At closing, we agreed to contribute cash of $ 13.3 million, which has been fully funded, in exchange for a 50.0 % interest in the 2827 Peachtree joint venture.
Brand contributed land valued at $ 7.7 million and cash of $ 5.6 million in exchange for the remaining 50.0 % interest.
−Removed: We also committed to provide a $ 49.6 million interest-only secured construction loan to the 2827 Peachtree joint venture that is scheduled to mature in December 2024 with an option to extend for one year .
+Added: We have provided a $ 52.8 million interest-only secured construction loan to the 2827 Peachtree joint venture that is scheduled to mature in December 2024 with an option to extend for one year .
The loan bears interest at SOFR plus 310 basis points.
As of December 31, 2023, $ 46.9 million was drawn on this loan.
+Added: We determined that we have a variable interest in the 2827 Peachtree joint venture primarily because the entity was designed to pass along interest rate risk, equity price risk and operation risk to us, both as a debt and an equity holder, and to Brand as an equity holder.
+Added: The 2827 Peachtree joint venture was further determined to be a variable interest entity as it requires additional subordinated financial support in the form of a loan because the initial equity investments provided by us and Brand are not sufficient to finance its planned investments and operations.
+Added: We concluded we do not have the power to direct matters that most significantly impact the activities of the entity and therefore do not qualify as the primary beneficiary.
+Added: Accordingly, the entity is not consolidated.
+Added: As of December 31, 2023, our risk of loss with respect to this arrangement was $ 60.3 million, which consists of the $ 13.4 million carrying value of our investment balance plus the $ 46.9 million outstanding balance of the loan.
+Added: The outstanding balance on the loan is recorded in investments in and advances to unconsolidated affiliates on our Consolidated Balance Sheets.
+Added: The assets of the 2827 Peachtree joint venture can only be used to settle obligations of the joint venture, and its creditors have no recourse to our wholly owned assets.
- Other Activities
2 unchanged sentences
During the years ended December 31, 2023, 2022 and 2021, we recognized $ 1.0 million, $ 0.6 million and $ 1.6 million, respectively, of development/construction, management and leasing fees from our unconsolidated joint ventures.
−Removed: Consolidated Affiliates
+Added: Consolidated Affiliate
- HRLP MTW, LLC (“Midtown West joint venture”)
In 2019, we and Bromley formed a joint venture to construct Midtown West, a 152,000 square foot, multi-customer office building located in the mixed-use Midtown Tampa project in Tampa’s Westshore submarket.
−Removed: The Midtown West joint venture has an anticipated total investment of $ 71.3 million.
−Removed: Construction of Midtown West began in the third quarter of 2019 and the building was placed in service in the second quarter of 2021.
At closing, we agreed to contribute cash of $ 20.0 million, which has been fully funded, in exchange for an 80.0 % interest in the Midtown West joint venture, and Bromley contributed land valued at $ 5.0 million in exchange for the remaining 20.0 % interest.
−Removed: We also committed to provide a $ 46.3 million interest-only secured construction loan to the Midtown West joint venture that is scheduled to mature in June 2023.
−Removed: The loan bears interest at LIBOR plus 250 basis points.
−Removed: As of December 31, 2022, $ 39.2 million was drawn on this loan.
−Removed: - Highwoods-Markel Associates, LLC (“Markel”)
−Removed: We have a 50.0 % ownership interest in Markel, a consolidated joint venture.
−Removed: We are the manager and leasing agent for Markel’s properties, which are located in Richmond in exchange for customary management and leasing fees.
−Removed: We consolidate Markel since we are the managing member and control the major operating and financial policies of the entity.
−Removed: As controlling member, we have an obligation to cause this property-owning entity to distribute proceeds of liquidation to the noncontrolling interest member in these partially owned properties only if the net proceeds received by the entity from the sale of any of Markel’s assets warrant a distribution as determined by the agreement governing the joint venture.
−Removed: We estimate the value of such noncontrolling interest distributions would have been $ 34.4 million had the entity been liquidated as of December 31, 2022.
−Removed: This estimated settlement value is based on the fair value of the underlying properties which is based on a number of assumptions that are subject to economic and market uncertainties including, among others, demand for space, competition for customers, changes in market rental rates and costs to operate each property.
−Removed: If the entity’s underlying assets are worth less than the underlying liabilities on the date of such liquidation, we would have no obligation to remit any consideration to the noncontrolling interest holder.
−Removed: The assets of Markel can be used only to settle obligations of the joint venture and its creditors have no recourse to our wholly owned assets.
−Removed: During 2021, Markel sold land in Richmond for a sale price of $ 3.0 million and recorded gain on disposition of property of $ 1.3 million.
−Removed: Joint Venture Rights and Obligations
−Removed: With respect to some of our joint ventures, we have a right to buy, and our joint venture partner has a right to sell to us, such joint venture partner’s interest under certain circumstances for fair market value (less estimated costs to sell) during various timeframes in the future.
−Removed: For our Granite Park Six joint venture, such rights are exercisable during the two -year period commencing on the 10th anniversary of the completion date.
−Removed: For each of our 23Springs and McKinney & Olive joint ventures, such rights are exercisable during the two -year period commencing on the 12th anniversary of the stabilization date of 23Springs.
−Removed: For our 2827 Peachtree joint venture, such rights are exercisable during the two -year period commencing on the earlier of:
−Removed: (1) the stabilization date;
−Removed: (2) the seventh anniversary of the completion date;
−Removed: and (3) maturity of the loan provided by us to the joint venture.
−Removed: For our Midtown West joint venture, our right to buy our partner’s interest is exercisable during the two -year period commencing on the seventh anniversary of the completion date, and our partner’s right to sell its interest to us is exercisable during the period commencing on the stabilization date and ending on the ninth anniversary of the completion date.
−Removed: In addition to the foregoing, with respect to our Granite Park Six, 23Springs and Midtown West joint ventures, our joint venture partner has a right to receive additional consideration from us or the joint venture under certain circumstances if and to the extent the internal rate of return on the applicable development project exceeds certain thresholds.
−Removed: Variable Interest Entities
−Removed: The acquisition of SIX50 at Legacy Union in Charlotte was completed in 2022 using a special purpose entity owned by a qualified intermediary to facilitate one or more potential Section 1031 reverse exchanges under the Internal Revenue Code.
−Removed: As of December 31, 2022, this variable interest entity had total assets, liabilities and cash flows of $ 199.9 million, $ 3.6 million, and $ 1.6 million, respectively.
−Removed: We determined that we have a variable interest in both the Granite Park Six and 23Springs joint ventures primarily because the entities were designed to pass along interest rate risk, equity price risk and operation risk to us and Granite as equity holders.
−Removed: The joint ventures were further determined to be variable interest entities as they require additional subordinated financial support in the form of loans because the initial equity investments provided by us and Granite are not sufficient to finance the planned investments and operations.
−Removed: We concluded we do not have the power to direct matters that most significantly impact the activities of either entity and therefore do not qualify as the primary beneficiary.
−Removed: Accordingly, the entities are not consolidated.
−Removed: As of December 31, 2022, our risk of loss with respect to these arrangements was limited to the carrying value of each investment balance.
−Removed: Our investment balances were $ 40.6 million and $ 44.9 million as of December 31, 2022 for the Granite Park Six and 23Springs joint ventures, respectively.
−Removed: The assets of the Granite Park Six and 23Springs joint ventures can be used only to settle obligations of the respective joint venture, and their creditors have no recourse to our wholly owned assets.
−Removed: We determined that we have a variable interest in the McKinney & Olive joint venture primarily because the entity was designed to pass along interest rate risk, equity price risk and operation risk to us and Granite as equity holders.
−Removed: The McKinney & Olive joint venture was further determined to be a variable interest entity as it requires additional subordinated financial support in the form of a loan because the initial equity investments by us and Granite, including the additional preferred equity provided by us, are not sufficient to finance its planned investments and operations.
−Removed: We concluded we do not have the power to direct matters that most significantly impact the activities of the entity and therefore do not qualify as the primary beneficiary.
−Removed: Accordingly, the entity is not consolidated.
−Removed: As of December 31, 2022, our risk of loss with respect to this arrangement was $ 166.3 million, which represents the carrying value of our investment balance and includes the $ 80.0 million of preferred equity we funded.
−Removed: The assets of the McKinney & Olive joint venture can be used only to settle obligations of the joint venture, and its creditors have no recourse to our wholly owned assets.
−Removed: We determined that we have a variable interest in the Midtown East joint venture primarily because the entity was designed to pass along interest rate risk, equity price risk and operation risk to us as both a debt and equity holder and Bromley as an equity holder.
−Removed: The Midtown East joint venture was further determined to be a variable interest entity as it requires additional subordinated financial support in the form of a loan because the initial equity investments provided by us and Bromley are not sufficient to finance its planned investments and operations.
−Removed: We concluded we do not have the power to direct matters that most significantly impact the activities of the entity and therefore do not qualify as the primary beneficiary.
−Removed: Accordingly, the entity is not consolidated.
−Removed: As of December 31, 2022, our risk of loss with respect to this arrangement was limited to the carrying value of the investment balance of $ 0.3 million as no amounts were outstanding under the loan.
−Removed: The assets of the Midtown East joint venture can be used only to settle obligations of the joint venture, and its creditors have no recourse to our wholly owned assets.
−Removed: We determined that we have a variable interest in the 2827 Peachtree joint venture primarily because the entity was designed to pass along interest rate risk, equity price risk and operation risk to us as both a debt and equity holder and Brand as an equity holder.
−Removed: The 2827 Peachtree joint venture was further determined to be a variable interest entity as it requires additional subordinated financial support in the form of a loan because the initial equity investments provided by us and Brand are not sufficient to finance its planned investments and operations.
−Removed: We concluded we do not have the power to direct matters that most significantly impact the activities of the entity and therefore do not qualify as the primary beneficiary.
−Removed: Accordingly, the entity is not consolidated.
−Removed: As of December 31, 2022, our risk of loss with respect to this arrangement was $ 21.8 million, which consists of the $ 17.8 million carrying value of our investment balance plus the $ 4.0 million outstanding balance of the loan.
−Removed: The assets of the 2827 Peachtree joint venture can be used only to settle obligations of the joint venture, and its creditors have no recourse to our wholly owned assets.
−Removed: We determined that we have a variable interest in the Midtown West joint venture primarily because the entity was designed to pass along interest rate risk, equity price risk and operation risk to us as both a debt and an equity holder and Bromley as an equity holder.
+Added: We also provided a $ 46.3 million interest-only secured construction loan to the Midtown West joint venture.
+Added: All of the amounts outstanding under this loan were repaid in the fourth quarter of 2023.
+Added: During 2023, the Midtown West joint venture obtained a $ 45.0 million, five-year secured mortgage loan from a third party lender, with an effective fixed rate of 7.29 %.
+Added: This loan is scheduled to mature in November 2028.
+Added: The joint venture incurred $ 0.8 million of debt issuance costs, which will be amortized over the term of the loan.
+Added: The net proceeds were used by the joint venture to repay in full the secured construction loan we provided, as discussed above.
+Added: We determined that we have a variable interest in the Midtown West joint venture primarily because the entity was designed to pass along interest rate risk, equity price risk and operation risk to us, both as a debt and an equity holder, and to Bromley as an equity holder.
The Midtown West joint venture was further determined to be a variable interest entity as it requires additional subordinated financial support in the form of a loan because the initial equity investments provided by us and Bromley are not sufficient to finance its planned investments and operations.
−Removed: We, as majority owner and managing member and through our control rights as set forth in the joint venture’s governance documents, were determined to be the primary beneficiary as we have both the power to direct the activities that most significantly affect the entity (primarily lease rates, property operations and capital expenditures) and significant economic exposure through our equity investment and loan commitment.
−Removed: As such, the Midtown West joint venture is consolidated and all intercompany transactions and accounts are eliminated.
+Added: We, as majority owner and managing member and through our control rights as set forth in the joint venture’s governance documents, were determined to be the primary beneficiary as we have both the power to direct the activities that most significantly affect the entity (primarily lease rates,
+Added: property operations and capital expenditures) and significant economic exposure through our equity investment.
+Added: The joint venture obtaining a loan from a third party during 2023, as discussed above, was a reconsideration event that did not change our initial conclusion that the Midtown West joint venture is a variable interest entity of which we are the primary beneficiary.
+Added: As such, the entity remains consolidated and all intercompany transactions and accounts are eliminated.
The following table sets forth the assets and liabilities of the Midtown West joint venture included on our Consolidated Balance Sheets:
1 unchanged sentence
Cash and cash equivalents $ 1,096 $ 1,009
+Added: Restricted cash $ 2,260 $ —
Accounts receivable $ 31 $ 1,490
2 unchanged sentences
Prepaid expenses and other assets $ 124 $ 153
+Added: Mortgages and notes payable, net $ 44,192 $ —
Accounts payable, accrued expenses and other liabilities $ 2,872 $ 1,212
−Removed: The assets of the Midtown West joint venture can be used only to settle obligations of the joint venture, and its creditors have no recourse to our wholly owned assets.
+Added: The assets of the Midtown West joint venture can only be used to settle obligations of the joint venture, and its creditors have no recourse to our wholly owned assets.
+Added: Joint Venture Rights and Obligations
+Added: With respect to some of our joint ventures, we have a right to buy, and our joint venture partner has a right to sell to us, such joint venture partner’s interest under certain circumstances for fair market value (less estimated costs to sell) during various timeframes in the future.
+Added: For our Granite Park Six joint venture, such rights are exercisable during the two-year period commencing on the 10th anniversary of the completion date.
+Added: For each of our 23Springs and McKinney & Olive joint ventures, such rights are exercisable during the two-year period commencing on the 12th anniversary of the stabilization date of 23Springs.
+Added: For our 2827 Peachtree joint venture, such rights are exercisable during the two-year period commencing on the earlier of:
+Added: (1) the stabilization date;
+Added: (2) the seventh anniversary of the completion date;
+Added: and (3) the maturity of the loan provided by us to the joint venture.
+Added: For our Midtown West joint venture, our right to buy our partner’s interest is exercisable during the two-year period commencing on the seventh anniversary of the completion date, and our partner’s right to sell its interest to us is exercisable during the period commencing on the stabilization date and ending on the ninth anniversary of the completion date.
+Added: In addition to the foregoing, with respect to our Granite Park Six, 23Springs and Midtown West joint ventures, our joint venture partner has the right to receive additional consideration from us or the joint venture under certain circumstances if and to the extent the internal rate of return on the applicable development project exceeds certain thresholds.
Intangible Assets and Below Market Lease Liabilities
16 unchanged sentences
$ 3,338 $ 3,320 $ 1,932
−Removed: Amortization of acquisition-related intangible assets (in rental property and other expenses)
−Removed: $ — $ — $ 510
Amortization of acquisition-related below market lease liabilities (in rental and other revenues)
14 unchanged sentences
Weighted average remaining amortization periods as of December 31, 2023 (in years) 7.4 7.2 7.1 8.1
−Removed: The following table sets forth the intangible assets acquired and below market lease liabilities assumed as a result of the acquisition of SIX50 at Legacy Union in Charlotte:
−Removed: Acquisition-Related Intangible Assets (amortized in Rental and Other Revenues) Acquisition-Related Intangible Assets (amortized in Depreciation and Amortization) Acquisition-Related Below Market Lease Liabilities (amortized in Rental and Other Revenues)
−Removed: Amount recorded at acquisition $ 4,722 $ 12,606 $ ( 2,172 )
−Removed: Weighted average remaining amortization periods as of December 31, 2022 (in years) 8.8 9.6 12.5
Mortgages and Notes Payable
1 unchanged sentence
Secured indebtedness (1) :
+Added: 5.69% mortgage loan due 2028 $ 200,000 $ —
+Added: 7.29% mortgage loan due 2028 (2)
4.27% (3.61% effective rate) mortgage loan due 2028 (3)
10 unchanged sentences
3.875% (4.038% effective rate) notes due 2027 (7)
−Removed: 3.875% (4.038% effective rate) notes due 2027 (7)
298,734 298,334
7 unchanged sentences
398,892 398,735
+Added: 7.650% (7.836% effective rate) notes due 2034 (12)
Variable rate term loan due 2026 (13)
1 unchanged sentence
Variable rate term loan due 2027 (13)
+Added: 150,000 150,000
Variable rate term loan due 2024 (14)
6 unchanged sentences
We paid down $ 6.7 million of secured loan balances through principal amortization during 2023.
+Added: (2) The borrower under this loan is our Midtown West joint venture, a consolidated 80.0 % owned joint venture.
(3) Net of unamortized fair market value premium of $ 2.7 million and $ 3.3 million as of December 31, 2023 and 2022, respectively.
(4) Net of unamortized fair market value premium of $ 1.7 million and $ 2.0 million as of December 31, 2023 and 2022, respectively.
−Removed: (4) Net of unamortized fair market value discount of $ 0.5 million and $ 0.6 million as of December 31, 2022 and 2021, respectively.
+Added: (5) Net of unamortized fair market value discount of $ 0.5 million as of both December 31, 2023 and 2022.
(6) Net of unamortized fair market value premium of $ 8.6 million and $ 9.3 million as of December 31, 2023 and 2022, respectively.
−Removed: (6) Net of unamortized original issuance discount of $ 0.3 million as of December 31, 2021.
−Removed: This debt was repaid in 2022.
(7) Net of unamortized original issuance discount of $ 1.3 million and $ 1.7 million as of December 31, 2023 and 2022, respectively.
3 unchanged sentences
(11) Net of unamortized original issuance discount of $ 1.1 million and $ 1.3 million as of December 31, 2023 and 2022, respectively.
+Added: (12) Net of unamortized original issuance discount of $ 4.6 million as of December 31, 2023.
(13) The interest rate was 6.35 % as of December 31, 2023.
+Added: (14) This loan was repaid in full as of December 31, 2023.
(15) The interest rate was 6.25 % as of December 31, 2023.
3 unchanged sentences
Less-unamortized debt issuance costs ( 17,739 )
−Removed: Our $ 750.0 million unsecured revolving credit facility is scheduled to mature in March 2025 and includes an accordion feature that currently allows for an additional $ 200.0 million of borrowing capacity subject to additional lender commitments.
−Removed: Assuming no defaults have occurred, we have an option to extend the maturity for two additional six -month periods.
−Removed: During the second quarter of 2022, in connection with the modification of our $ 200.0 million term loan as discussed below, the interest rate on our revolving credit facility was converted from LIBOR plus 90 basis points to SOFR plus a related spread adjustment of 10 basis points and a borrowing spread of 85 basis points, based on current credit ratings.
−Removed: The annual facility fee is 20 basis points.
−Removed: The interest rate and facility fee are based on the higher of the publicly announced ratings from Moody’s Investors Service or Standard & Poor’s Ratings Services.
−Removed: We may be entitled to a temporary reduction in the interest rate of one basis point provided we meet certain sustainability goals with respect to the ongoing reduction of greenhouse gas emissions.
−Removed: There was $ 386.0 million and $ 392.0 million outstanding under our new revolving credit facility as of December 31, 2022 and January 27, 2023, respectively.
−Removed: As of both December 31, 2022 and January 27, 2023, we had $ 0.1 million of outstanding letters of credit, which reduces the availability on our revolving credit facility.
−Removed: As a result, the unused capacity of our revolving credit facility as of December 31, 2022 and January 27, 2023 was $ 363.9 million and $ 357.9 million, respectively.
−Removed: During 2022, we obtained a $ 200.0 million, two -year unsecured bank term loan that is scheduled to mature in October 2024.
−Removed: Assuming no defaults have occurred, we have an option to extend the maturity for one additional year.
−Removed: The interest rate, based on current credit ratings, is SOFR plus a related spread adjustment of 10 basis points and a borrowing spread of 95 basis points.
−Removed: The interest rate is based on the higher of the publicly announced ratings from Moody’s Investors Service or Standard & Poor’s Ratings Services.
−Removed: We may be entitled to a temporary reduction in the interest rate of one basis point provided we meet certain sustainability goals with respect to the ongoing reduction of greenhouse gas emissions.
−Removed: Additionally, we used the additional $ 200.0 million of borrowings, together with available cash and borrowings under our revolving credit facility, to prepay without penalty $ 250.0 million principal amount of 3.625 % unsecured notes that were scheduled to mature in January 2023.
−Removed: During 2022, we modified our $ 200.0 million unsecured bank term loan to extend the maturity date from November 2022 to May 2026.
+Added: As of December 31, 2023,our $ 750.0 million unsecured revolving credit facility was scheduled to mature in March 2025.
+Added: The interest rate on our revolving credit facility was SOFR plus a related spread adjustment of 10 basis points and a borrowing spread of 85 basis points, based on current credit ratings.
+Added: The annual facility fee was 20 basis points.
+Added: The interest rate and facility fee were based on the higher of the publicly announced ratings from Moody’s Investors Service or Standard & Poor’s Ratings Services.
+Added: We were entitled to a temporary reduction in the interest rate of one basis point provided we meet certain sustainability goals with respect to the ongoing reduction of greenhouse gas emissions.
+Added: As of December 31, 2023, there was $ 20.0 million outstanding under our revolving credit facility and $ 0.9 million of outstanding letters of credit, which reduces the availability on our revolving credit facility.
+Added: As a result, the unused capacity of our revolving credit facility as of December 31, 2023 was $ 729.1 million.
+Added: During 2023, the Operating Partnership issued $ 350.0 million aggregate principal amount of 7.650 % notes due February 2034, less original issuance discount of $ 4.6 million.
+Added: These notes were priced to yield 7.836 %.
+Added: Previously during 2023, we obtained an aggregate of $ 200.0 million notional amount of forward-starting swaps that effectively locked the underlying 10-year treasury rate at 4.498 %.
+Added: Upon the subsequent issuance of the notes, we terminated the forward-starting swaps and paid cash upon settlement.
+Added: The unrealized loss of $ 0.5 million will be classified to interest expense as interest payments are made on the debt.
+Added: Underwriting fees and other expenses totaled $ 3.2 million and will be amortized over the term of the notes.
+Added: The net proceeds from the issuance were used:
+Added: (1) to prepay, without penalty, a $ 200.0 million unsecured bank term loan that was scheduled to mature in October 2024;
+Added: (2) to repay amounts outstanding under our revolving credit facility;
+Added: and (3) for general corporate purposes.
+Added: We recorded $ 0.6 million of loss on debt extinguishment related to the term loan prepayment.
+Added: During 2023, we obtained a $ 200.0 million, five-year secured mortgage loan from a third party lender, with an effective fixed interest rate of 5.69 %.
+Added: This loan is scheduled to mature in April 2028.
+Added: We incurred $ 1.3 million of debt issuance costs, which will be amortized over the term of the loan.
+Added: During 2022, we obtained a $ 200.0 million, two-year unsecured bank term loan that was originally scheduled to mature in October 2024.
+Added: This loan was prepaid in full without penalty during the fourth quarter of 2023.
+Added: The interest rate, based on current credit ratings, was SOFR plus a related spread adjustment of 10 basis points and a borrowing spread of 95 basis points.
+Added: The interest rate was based on the higher of the publicly announced ratings from Moody’s Investors Service or Standard & Poor’s Ratings Services.
+Added: We were entitled to a temporary reduction in the interest rate of one basis point provided we met certain sustainability goals with respect to the ongoing reduction of greenhouse gas emissions.
+Added: We used the additional $ 200.0 million of borrowings, together with available cash and borrowings under our revolving credit facility, to prepay without penalty $ 250.0 million principal amount of 3.625 % unsecured notes that were scheduled to mature in January 2023.
+Added: During 2022, we modified our other $ 200.0 million unsecured bank term loan to extend the maturity date from November 2022 to May 2026.
As part of this modification, we also obtained a $ 150.0 million delayed-draw term loan, which was drawn in its entirety in the third quarter of 2022, that is scheduled to mature in May 2027.
1 unchanged sentence
The interest rate is based on the higher of the publicly announced ratings from Moody’s Investors Service or Standard & Poor’s Ratings Services.
−Removed: We may be entitled to a temporary reduction in the interest rate of one basis point provided we meet certain sustainability goals with respect to the ongoing reduction of greenhouse gas emissions.
+Added: Subject to written consent of the lenders, we may elect to amend this term loan no later than May 15, 2024 to provide that the interest rate may be adjusted upward or downward by up to 2.5 basis points subject to satisfaction of certain to-be-determined sustainability goals with respect to the ongoing reduction of greenhouse gas emissions.
We incurred $ 2.7 million of debt issuance costs, which are being amortized along with certain existing unamortized debt issuance costs over the remaining term of our modified term loan.
9 unchanged sentences
We recorded $ 0.1 million of loss on debt extinguishment related to this prepayment.
−Removed: During 2020, the Operating Partnership issued $ 400.0 million aggregate principal amount of 2.600 % notes due February 2031, less original issuance discount of $ 1.6 million.
−Removed: These notes were priced to yield 2.645 %.
−Removed: Underwriting fees and other expenses were incurred that aggregated $ 3.4 million;
−Removed: these costs were deferred and will be amortized over the term of the notes.
−Removed: The net proceeds from the issuance were used:
−Removed: (1) to finance the Operating Partnership’s cash tender offer to purchase $ 150.0 million principal amount of its 3.20 % notes due June 15, 2021 at a purchase price of 101.908 % of the face amount of the notes, plus accrued and unpaid interest;
−Removed: (2) to prepay without penalty our $ 100.0 million unsecured bank term loan that was scheduled to mature in January 2022 and which bore interest at LIBOR plus 110 basis points;
−Removed: and (3) for general corporate purposes.
−Removed: We recorded $ 3.7 million of aggregate losses on debt extinguishment related to the repurchase of the 3.20 % notes and the term loan prepayment.
We previously entered into floating-to-fixed interest rate swaps through January 2022 with respect to an aggregate of $ 50.0 million LIBOR-based borrowings.
5 unchanged sentences
In addition, certain of our unsecured debt agreements contain cross-default provisions giving the unsecured lenders the right to declare a default if we are in default under more than $ 35.0 million with respect to other loans in some circumstances.
−Removed: The Operating Partnership has $ 298.3 million carrying amount of 2027 notes outstanding, $ 347.9 million carrying amount of 2028 notes outstanding, $ 349.4 million carrying amount of 2029 notes outstanding, $ 399.3 million carrying amount of 2030 notes outstanding and $ 398.7 million carrying amount of 2031 notes outstanding.
+Added: The Operating Partnership has $ 2,140.2 million carrying amount of various notes outstanding as detailed in the table above.
The indenture that governs these outstanding notes requires us to comply with customary operating covenants and various financial ratios.
1 unchanged sentence
We have considered our short-term liquidity needs within one year from February 6, 2024 (the date of issuance of the annual financial statements) and the adequacy of our estimated cash flows from operating activities and other available financing sources to meet these needs.
−Removed: In particular, we have considered our scheduled debt maturities during such one-year period.
+Added: Importantly, we have no scheduled debt maturities during such one-year period.
We have concluded it is probable we will meet these short-term liquidity requirements through a combination of the following:
20 unchanged sentences
Litigation, Claims and Assessments
−Removed: We are from time to time a party to a variety of legal proceedings, claims and assessments arising in the ordinary course of our business.
+Added: From time to time, we are a party to a variety of legal proceedings, claims and assessments arising in the ordinary course of our business.
We regularly assess the liabilities and contingencies in connection with these matters based on the latest information available.
−Removed: For those matters where it is probable that we have incurred or will incur a loss and the loss or range of loss can be reasonably estimated, the estimated loss is accrued and charged to income in our Consolidated Financial Statements.
+Added: For matters where it is probable that we have incurred or will incur a loss and the loss or range of loss can be reasonably estimated, the estimated loss is accrued and charged to income in our Consolidated Financial Statements.
In other instances, because of the uncertainties related to both the probable outcome and amount or range of loss, a reasonable estimate of liability, if any, cannot be made.
1 unchanged sentence
Joint Venture Buyout Rights and Obligations
−Removed: With respect to certain joint ventures, we have a right to buy, and our joint venture partner has a right to sell, such joint venture interest to us under certain circumstances for fair market value (less estimated costs to sell) at various dates in the future.
+Added: With respect to certain of our joint ventures, we have a right to buy, and our joint venture partner has a right to sell to us, such joint venture partner's interest under certain circumstances for fair market value (less estimated costs to sell) at various timeframes in the future.
In addition, with respect to certain of our joint ventures, our joint venture partner has a right to receive additional consideration from us or the joint venture under certain circumstances if and to the extent the internal rate of return on the applicable development project exceeds certain thresholds.
1 unchanged sentence
Noncontrolling Interests in Consolidated Affiliates
−Removed: As of December 31, 2022, our noncontrolling interests in consolidated affiliates relate to our joint venture partners’ 50.0 % interest in Markel and 20.0 % interest in the Midtown West joint venture.
−Removed: Our joint venture partners are unrelated third parties.
+Added: As of December 31, 2023, our noncontrolling interests in consolidated affiliates relate to our joint venture partner’s 20.0 % interest in the Midtown West joint venture.
+Added: Our joint venture partner is an unrelated third party.
Noncontrolling Interests in the Operating Partnership
17 unchanged sentences
Redemptions of Common Units 163 3,763 —
−Removed: Issuances of Common Units — — ( 6,163 )
Change from net income available for common stockholders and transfers from noncontrolling interests $ 151,188 $ 161,586 $ 325,867
12 unchanged sentences
In addition, credit valuation adjustments are considered in the fair values to account for potential nonperformance risk, but were concluded to not be significant inputs to the calculation for the periods presented.
−Removed: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
+Added: Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities.
Our Level 3 assets include any real estate assets recorded at fair value on a non-recurring basis as a result of our quarterly impairment analysis, which are valued using unobservable local and national industry market data such as comparable sales, appraisals, brokers’ opinions of value and/or the terms of definitive sales contracts.
25 unchanged sentences
$ 2,832,973 $ — $ 2,832,973
−Removed: Interest rate swaps (in accounts payable, accrued expenses and other liabilities)
Non-qualified deferred compensation obligation (in accounts payable, accrued expenses and other liabilities)
11 unchanged sentences
During 2023, we entered into separate equity distribution agreements in which the Company may offer and sell up to $ 300.0 million in aggregate gross sales price of shares of Common Stock.
−Removed: During 2022 and 2021, respectively, the Company issued 130,011 and 456,273 shares of Common Stock under its equity distribution agreements at an average gross sales price of $ 46.50 and $ 46.23 per share and received net proceeds, after sales commissions, of $ 6.0 million and $ 20.8 million.
+Added: There were no shares issued under these agreements in 2023.
+Added: During 2022, the Company issued 130,011 shares of Common Stock under its equity distribution agreements at an average gross sales price of $ 46.50 per share and received net proceeds, after sales commissions, of $ 6.0 million.
As of December 31, 2023, the Company had 94.3 million remaining shares of Common Stock authorized to be issued under its charter.
6 unchanged sentences
Capital gains 0.42 0.18 0.09
−Removed: Return of capital — — 0.02
Total $ 2.00 $ 2.00 $ 1.96
14 unchanged sentences
As of both December 31, 2023 and 2022, we had 15,000 warrants outstanding with an exercise price of $ 32.50 per share.
−Removed: Upon exercise of a warrant, the Company will contribute the exercise price to the Operating Partnership in exchange for Common Units.
+Added: Upon exercise of a warrant, the Company will contribute the exercise price to the Operating Partnership in exchange for
+Added: Common Units.
Therefore, the Operating Partnership accounts for such warrants as if issued by the Operating Partnership.
44 unchanged sentences
- Stock Options
−Removed: Stock options issued from 2014 through 2017 vest ratably on an annual basis over four years and expire after 10 years.
+Added: Outstanding stock options vest ratably on an annual basis over four years and expire after 10 years.
All stock options have an exercise price equal to the last reported stock price of our Common Stock on the New York Stock Exchange (“NYSE”) on the last trading day prior to grant.
5 unchanged sentences
Exercised ( 25,306 ) 43.76
−Removed: Forfeited ( 5,366 ) 50.82
Stock options outstanding as of December 31, 2021 (1)
−Removed: Exercised ( 25,306 ) 43.76
−Removed: Stock options outstanding as of December 31, 2021 (1)
512,067 46.18
−Removed: (1) There were no options granted, canceled, exercised or forfeited during the year ended December 31, 2022.
−Removed: The Company had 512,067 options exercisable as of both December 31, 2022 and 2021, with a weighted average exercise price of $ 46.18 at each date.
−Removed: As of December 31, 2022, these options had a weighted average remaining life of 3.0 years, and all had exercise prices higher than the market price of our common stock.
−Removed: As of December 31, 2021, these options had a weighted average remaining life of 4.0 years, an intrinsic value of $ 0.6 million, and there were 279,549 shares that had exercise prices higher than the market price of our common stock.
−Removed: No options were exercised during the year ended December 31, 2022 .
−Removed: Cash received or receivable from options exercised was $ 1.1 million and $ 1.9 million for the years ended December 31, 2021 and 2020, respectively.
−Removed: The total intrinsic value of options exercised during the years ended December 31, 2021 and 2020 was $ 0.1 million and $ 0.4 million, respectively.
−Removed: The total intrinsic value of options outstanding as of December 31, 2021 and 2020 was $ 0.6 million and $ 0.1 million, respectively.
+Added: (1) There were no options granted, canceled, exercised or forfeited during the years ended December 31, 2023 and 2022.
+Added: The Company had 512,067 options exercisable as of December 31, 2023, 2022 and 2021, respectively, with a weighted average exercise price of $ 46.18 at each date.
+Added: As of December 31, 2023 and 2022, these options had a weighted average remaining life of 2.0 years and 3.0 years, respectively, and all had exercise prices higher than the market price of our common stock.
+Added: No options were exercised during the years ended December 31, 2023 and 2022 , respectively .
+Added: Cash received or receivable from options exercised was $ 1.1 million for the year ended December 31, 2021.
+Added: The total intrinsic value of options exercised during the year ended December 31, 2021 was $ 0.1 million.
+Added: The total intrinsic value of options outstanding as of December 31, 2021 was $ 0.6 million.
The Company generally does not permit the net cash settlement of exercised stock options, but does permit net share settlement so long as the shares received are held for at least a year.
9 unchanged sentences
103,120 39.99
+Added: ( 89,264 ) 45.90
Forfeited ( 3,327 ) 43.13
2 unchanged sentences
( 101,082 ) 42.80
−Removed: ( 89,264 ) 45.90
Forfeited ( 779 ) 42.37
2 unchanged sentences
155,717 26.42
+Added: ( 95,423 ) 43.57
Forfeited ( 1,819 ) 34.11
7 unchanged sentences
For total return-based restricted stock issued prior to 2022, notwithstanding the Company’s absolute total return, if the Company’s total return exceeds 100 % of the average peer group total return index, 100 % of total return-based restricted stock issued will vest at the end of the applicable period.
−Removed: For total return-based restricted stock issued during 2022, notwithstanding the Company’s absolute total return, if the Company’s total return is in the 50th percentile or greater as compared to all of the companies included in the FTSE NAREIT Equity Office Index, 100 % of total return-based restricted stock issued will vest at the end of the applicable period.
+Added: For total return-based restricted stock issued since 2022, notwithstanding the Company’s absolute total return, if the Company’s total return is in the 50th percentile or greater as compared to all of the companies included in the FTSE NAREIT Equity Office Index, 100 % of total return-based restricted stock issued will vest at the end of the applicable period.
The weighted average grant date fair value of such shares of total return-based restricted stock issued in 2023, 2022 and 2021 was determined to be $ 27.06 , $ 41.94 and $ 36.41 , respectively, and is amortized over the respective three-year period or the service period, if shorter, for employees who are or will become eligible under the Company’s retirement plan.
14 unchanged sentences
Awarded and issued (1)
+Added: ( 55,452 ) 43.01
Forfeited (3)
8 unchanged sentences
126,736 27.06
+Added: ( 65,140 ) 44.88
Forfeited (3)
2 unchanged sentences
(1) The fair value at grant date of total return-based restricted stock issued during the years ended December 31, 2023, 2022 and 2021 was $ 3.4 million, $ 3.4 million and $ 2.9 million, respectively, at target.
−Removed: (2) The vesting date fair value of total return-based restricted stock that vested during the years ended December 31, 2022 and 2021 was $ 2.7 million and $ 2.2 million, respectively, based on the performance of the specific plans.
−Removed: Vested shares include those shares
−Removed: surrendered by employees to satisfy tax withholding obligations in connection with such vesting.
−Removed: There were no vested shares of total return-based restricted stock during the year ended December 31, 2020.
+Added: (2) The vesting date fair value of total return-based restricted stock that vested during the years ended December 31, 2023, 2022 and 2021 was $ 1.7 million, $ 2.7 million and $ 2.2 million, respectively, based on the performance of the specific plans.
+Added: Vested shares include those shares surrendered by employees to satisfy tax withholding obligations in connection with such vesting.
(3) The 2022 and 2021 amounts include 20,995 and 18,484 shares, respectively, that were forfeited at the end of the applicable measurement period because the applicable total return did not meet targeted levels.
+Added: No shares were forfeited in 2023.
401(k) Retirement Savings Plan
21 unchanged sentences
243 ( 302 ) 293
+Added: Distributions from deferred compensation plans ( 513 ) — —
Total deferred compensation liability $ 2,294 $ 2,564 $ 2,866
4 unchanged sentences
The 15 % discount on newly issued shares, which is taxable income to the participants and is recorded by us as additional compensation expense, aggregated $ 0.3 million, $ 0.2 million and $ 0.2 million in the years ended December 31, 2023, 2022 and 2021, respectively.
−Removed: Generally, shares purchased under the ESPP must be held at least one year.
+Added: Generally, shares purchased under the ESPP must be held for at least one year.
The Company satisfies its ESPP obligations by issuing additional shares of Common Stock.
−Removed: Real Estate and Other Assets Held For Sale
−Removed: The following table sets forth the assets held for sale as of December 31, 2022 and 2021, which are considered non-core:
−Removed: Land held for development $ — $ 3,482
−Removed: Net real estate assets — 3,482
−Removed: Prepaid expenses and other assets — 36
−Removed: Real estate and other assets, net, held for sale $ — $ 3,518
Earnings Per Share and Per Unit
5 unchanged sentences
Net (income) attributable to noncontrolling interests in the Operating Partnership ( 3,164 ) ( 3,670 ) ( 8,321 )
−Removed: Net (income) attributable to noncontrolling interests in consolidated affiliates ( 1,230 ) ( 1,712 ) ( 1,174 )
+Added: Net (income)/loss attributable to noncontrolling interests in consolidated affiliates 549 ( 1,230 ) ( 1,712 )
Dividends on Preferred Stock ( 2,485 ) ( 2,486 ) ( 2,486 )
5 unchanged sentences
Net income $ 151,330 $ 163,958 $ 323,310
−Removed: Net (income) attributable to noncontrolling interests in consolidated affiliates ( 1,230 ) ( 1,712 ) ( 1,174 )
+Added: Net (income)/loss attributable to noncontrolling interests in consolidated affiliates 549 ( 1,230 ) ( 1,712 )
Dividends on Preferred Stock ( 2,485 ) ( 2,486 ) ( 2,486 )
12 unchanged sentences
Net income $ 151,330 $ 163,958 $ 323,310
−Removed: Net (income) attributable to noncontrolling interests in consolidated affiliates ( 1,230 ) ( 1,712 ) ( 1,174 )
+Added: Net (income)/loss attributable to noncontrolling interests in consolidated affiliates 549 ( 1,230 ) ( 1,712 )
Distributions on Preferred Units ( 2,485 ) ( 2,486 ) ( 2,486 )
5 unchanged sentences
Net income $ 151,330 $ 163,958 $ 323,310
−Removed: Net (income) attributable to noncontrolling interests in consolidated affiliates ( 1,230 ) ( 1,712 ) ( 1,174 )
+Added: Net (income)/loss attributable to noncontrolling interests in consolidated affiliates 549 ( 1,230 ) ( 1,712 )
Distributions on Preferred Units ( 2,485 ) ( 2,486 ) ( 2,486 )
13 unchanged sentences
accordingly, the only federal income taxes included in the accompanying Consolidated Financial Statements relate to activities of the Company’s taxable REIT subsidiary.
−Removed: The Company’s net deferred tax liability was $ 0.1 million as of December 31, 2021.
−Removed: There was no net deferred tax liability as of December 31, 2022.
−Removed: The net deferred tax liability is comprised primarily of tax versus book differences related to property (depreciation, amortization and basis differences).
+Added: The Company had no net deferred tax asset or liability as of December 31, 2023 or December 31, 2022.
For the years ended December 31, 2023 and 2022, there were no unrecognized tax benefits.
8 unchanged sentences
All operations are within the United States.
−Removed: The following tables summarize the rental and other revenues, net operating income (the primary industry property-level performance metric used by our chief operating decision maker and which is defined as rental and other revenues less rental property and other expenses) and total assets for our office properties.
−Removed: Our segment information as of and for the years ended December 31, 2021 and 2020, respectively, has been retrospectively revised from previously reported amounts to reflect a change in our reportable segments as a result of our plan to exit the Pittsburgh market.
+Added: The following tables summarize rental and other revenues, net operating income and total assets for our office properties.
+Added: Net operating income is the primary industry property-level performance metric used by our chief operating decision maker and is defined as rental and other revenues less rental property and other expenses.
Year Ended December 31,
27 unchanged sentences
Interest expense ( 136,710 ) ( 105,385 ) ( 85,853 )
−Removed: Other income/(loss) 1,530 1,394 ( 1,707 )
+Added: Other income 4,435 1,530 1,394
Gains on disposition of property 47,773 63,546 174,059
+Added: Gain on deconsolidation of affiliate 11,778 — —
Equity in earnings of unconsolidated affiliates 1,107 1,535 1,947
12 unchanged sentences
Subsequent Events
−Removed: We have a 50.0 % ownership interest in Markel, a joint venture that was consolidated as of December 31, 2022 (see Note 4).
−Removed: Effective January 1, 2023, the agreement governing the joint venture was modified to require the consent of both partners for major operating and financial policies of the entity.
−Removed: As a result, even though we remain the managing member, because we are no longer in sole control of the major operating and financial policies of the entity, we will no longer consolidate Markel and will account for the joint venture using the equity method of accounting effective January 1, 2023.
−Removed: On February 1, 2023, the Company declared a cash dividend of $ 0.50 per share of Common Stock, which is payable on March 14, 2023 to stockholders of record as of February 21, 2023.
+Added: Our $ 750.0 million unsecured revolving credit facility was modified on January 25, 2024 and is now scheduled to mature in January 2028 (but can be extended for two additional six-month periods at our option assuming no defaults have occurred).
+Added: The interest rate on our newly modified revolving credit facility remains SOFR plus a related spread adjustment of 10 basis points and a borrowing spread of 85 basis points, based on current credit ratings and the annual facility fee remains 20 basis points.
+Added: The interest rate and facility fee are based on the higher of the publicly announced ratings from Moody’s Investors Service or Standard & Poor’s Ratings Services.
+Added: Subject to written consent of the lenders, we may elect to amend the newly modified revolving credit facility no later than May 15, 2024 to provide that the interest rate may be adjusted upward or downward by up to 2.5 basis points subject to satisfaction of certain to-be-determined sustainability goals with respect to the ongoing reduction of greenhouse gas emissions.
+Added: The financial and other covenants under our newly modified facility are substantially similar to our previous credit facility.
+Added: We expect to incur $ 7.9 million of debt issuance costs, which will be amortized along with certain existing unamortized debt issuance costs over the remaining term of our new revolving credit facility.
+Added: We expect to record $ 0.2 million of loss on debt extinguishment.
+Added: As of January 26, 2024, there was $ 36.0 million outstanding under our revolving credit facility and $ 0.9 million of outstanding letters of credit, which reduces the availability on our revolving credit facility.
+Added: As a result, the unused capacity of our revolving credit facility as of January 26, 2024 was $ 713.1 million.
+Added: On January 31, 2024, the Company declared a cash dividend of $ 0.50 per share of Common Stock, which is payable on March 12, 2024 to stockholders of record as of February 20, 2024.
HIGHWOODS PROPERTIES, INC.
7 unchanged sentences
Acquisitions, development and improvements 226,066 378,587 1,248,256
−Removed: Cost of real estate sold and retired ( 175,031 ) ( 356,953 ) ( 441,441 )
+Added: Cost of real estate sold, retired and deconsolidated ( 187,755 ) ( 175,031 ) ( 356,953 )
Ending balance (a) $ 6,728,003 $ 6,689,692 $ 6,486,136
2 unchanged sentences
Depreciation expense 253,151 240,273 218,628
−Removed: Real estate sold and retired ( 88,282 ) ( 183,073 ) ( 187,970 )
+Added: Real estate sold, retired and deconsolidated ( 119,263 ) ( 88,282 ) ( 183,073 )
Ending balance (b) $ 1,743,390 $ 1,609,502 $ 1,457,511
45 unchanged sentences
Riverwood 200 Office 4,777 89,708 450 2,033 5,227 91,741 96,968 19,819 2017 5-40 yrs.
−Removed: Riverwood 300 - Land Office 400 — — 710 400 710 1,110 105 N/A 5-40 yrs.
+Added: Riverwood 300 - Land Office 400 — — 710 400 710 1,110 123 2017 5-40 yrs.
Monarch Tower Office 22,717 143,068 — 25,268 22,717 168,336 191,053 41,899 1997 5-40 yrs.
Monarch Plaza Office 27,678 88,962 — 19,637 27,678 108,599 136,277 24,488 1983 5-40 yrs.
−Removed: Galleria 75 - Land Office 19,740 — ( 906 ) 220 18,834 220 19,054 15 N/A N/A
+Added: Galleria 75 - Land Office 19,740 — ( 1,938 ) 697 17,802 697 18,499 99 2022 5-40 yrs.
Charlotte, NC
Bank of America Tower Office 200,000 29,273 354,749 — 28,069 29,273 382,818 412,091 47,795 2019 5-40 yrs.
−Removed: Morrocroft Office 69,473 19,286 177,199 — 5,569 19,286 182,768 202,054 9,120 1992 5-40 yrs.
−Removed: Capitol Towers Office 127,540 9,202 102,179 — 107 9,202 102,286 111,488 4,511 2015 5-40 yrs.
−Removed: Office — — 26,702 — 26,702 — 26,702 — N/A 5-40 yrs.
+Added: One Morrocroft Office (2) 3,655 28,357 ( 198 ) 4,697 3,457 33,054 36,511 3,114 1992 5-40 yrs.
+Added: Two Morrocroft Office (2) 3,530 28,804 ( 190 ) 1,675 3,340 30,479 33,819 2,716 1998 5-40 yrs.
+Added: Three Morrocroft Office (2) 3,566 30,505 ( 192 ) 11 3,374 30,516 33,890 2,737 2000 5-40 yrs.
HIGHWOODS PROPERTIES, INC.
10 unchanged sentences
Depreciation Date of
+Added: Capitol Towers North Office (3) 8,642 96,254 — 768 8,642 97,022 105,664 7,304 2017 5-40 yrs.
+Added: Capitol Towers South Office (3) 9,095 95,458 — 132 9,095 95,590 104,685 7,568 2015 5-40 yrs.
+Added: Tryon - Land Office 26,702 — ( 421 ) — 26,281 — 26,281 — N/A 5-40 yrs.
SIX50 at Legacy Union Office 16,504 166,305 — 1,400 16,504 167,705 184,209 7,741 2020 5-40 yrs.
19 unchanged sentences
SouthPointe Office 1,655 — 310 9,493 1,965 9,493 11,458 5,476 1998 5-40 yrs.
−Removed: Ramparts Office 2,394 12,806 — 11,543 2,394 24,349 26,743 10,899 1986 5-40 yrs.
Westwood South Office 2,106 — 382 11,190 2,488 11,190 13,678 7,041 1999 5-40 yrs.
9 unchanged sentences
Virginia Springs I Office 4,534 25,632 — 308 4,534 25,940 30,474 4,732 2018 5-40 yrs.
−Removed: 1100 Broadway - Land Office 29,845 — ( 200 ) — 29,645 — 29,645 — N/A N/A
−Removed: Asurion Office 33,219 230,569 — 2,253 33,219 232,822 266,041 9,601 2021 5-40 yrs.
HIGHWOODS PROPERTIES, INC.
10 unchanged sentences
Depreciation Date of
+Added: 1100 Broadway - Land Office 29,845 — ( 259 ) — 29,586 — 29,586 — N/A N/A
+Added: Asurion Office 33,219 230,569 — 2,780 33,219 233,349 266,568 17,157 2021 5-40 yrs.
Ovation - Land Office 89,231 — 192 — 89,423 — 89,423 — N/A N/A
−Removed: Broadway Stem - Land Office 6,218 — — 526 6,218 526 6,744 18 N/A 5-40 yrs.
+Added: Broadway Stem - Land Office 6,218 — ( 1,205 ) 526 5,013 526 5,539 31 2021 5-40 yrs.
YMCA Site - land Office 16,121 — ( 28 ) — 16,093 — 16,093 — N/A N/A
1 unchanged sentence
1800 Eller Drive Office — 9,851 — 1,692 — 11,543 11,543 7,963 1983 5-40 yrs.
−Removed: Seaside Plaza Office 3,893 29,541 — 14,028 3,893 43,569 47,462 12,534 1982 5-40 yrs.
+Added: 201 South Orange Office 3,893 29,541 — 14,687 3,893 44,228 48,121 13,704 1982 5-40 yrs.
Capital Plaza Two Office 4,346 43,394 — 14,697 4,346 58,091 62,437 15,476 1999 5-40 yrs.
16 unchanged sentences
4800 Falls of Neuse Office 2,678 17,630 — 7,472 2,678 25,102 27,780 17,202 1985 5-40 yrs.
−Removed: 5000 Falls of Neuse Office 1,010 4,612 ( 49 ) 3,792 961 8,404 9,365 4,717 1980 5-40 yrs.
801 Raleigh Corporate Center Office 828 — 272 13,031 1,100 13,031 14,131 6,345 2002 5-40 yrs.
5 unchanged sentences
3000 CentreGreen Office 1,779 — ( 397 ) 14,784 1,382 14,784 16,166 6,196 2002 5-40 yrs.
−Removed: 1000 CentreGreen Office 1,280 — 55 13,992 1,335 13,992 15,327 4,990 2008 5-40 yrs.
HIGHWOODS PROPERTIES, INC.
10 unchanged sentences
Depreciation Date of
−Removed: GlenLake - Land Office 13,003 — ( 12,382 ) 114 621 114 735 62 N/A 5-40 yrs.
+Added: 1000 CentreGreen Office 1,280 — 55 13,765 1,335 13,765 15,100 5,491 2008 5-40 yrs.
+Added: GlenLake - Land Office 13,003 — ( 12,382 ) 114 621 114 735 65 2001 5-40 yrs.
GlenLake One Office 924 — 1,324 23,241 2,248 23,241 25,489 11,934 2002 5-40 yrs.
3 unchanged sentences
7001 Weston Parkway Office 531 — ( 267 ) 8,064 264 8,064 8,328 5,069 1998 5-40 yrs.
−Removed: Inveresk Parcel 2 - Land Office 657 — 38 103 695 103 798 19 N/A 5-40 yrs.
+Added: Inveresk Parcel 2 - Land Office 657 — 38 103 695 103 798 22 2015 5-40 yrs.
4201 Lake Boone Trail Office 1,450 6,311 — 1,077 1,450 7,388 8,838 2,519 1998 5-40 yrs.
8 unchanged sentences
2300 Rexwoods Drive Office 1,301 — 184 9,988 1,485 9,988 11,473 4,620 1998 5-40 yrs.
−Removed: 4709 Creekstone Drive Office 469 4,038 23 5,722 492 9,760 10,252 3,752 1987 5-40 yrs.
4700 Six Forks Road Office 666 2,665 — 1,796 666 4,461 5,127 2,666 1982 5-40 yrs.
34 unchanged sentences
150 Fayetteville Office 110,391 7,677 130,049 — 17,401 7,677 147,450 155,127 12,307 1991 5-40 yrs.
+Added: GlenLake III Office — — 3,981 65,660 3,981 65,660 69,641 550 2023 5-40 yrs.
+Added: 2205 Evans Road - Land Office — — 2,676 — 2,676 — 2,676 — N/A N/A
Other Property Other 27,260 20,868 ( 15,828 ) 6,837 11,432 27,705 39,137 10,640 N/A 5-40 yrs.
1 unchanged sentence
Colonnade Building Office 1,364 6,105 — 3,021 1,364 9,126 10,490 4,306 2003 5-40 yrs.
−Removed: Markel 4521 Office 1,581 13,299 168 ( 378 ) 1,749 12,921 14,670 7,029 1999 5-40 yrs.
Highwoods Commons Office 521 — 458 5,038 979 5,038 6,017 2,539 1999 5-40 yrs.
5 unchanged sentences
4101 Cox Road Office 1,205 4,825 — 2,887 1,205 7,712 8,917 4,361 1990 5-40 yrs.
−Removed: Markel 4501 Office 1,300 13,259 213 ( 3,435 ) 1,513 9,824 11,337 4,497 1998 5-40 yrs.
−Removed: 4600 Cox Road Office 1,700 17,081 169 ( 3,208 ) 1,869 13,873 15,742 6,444 1989 5-40 yrs.
North Park Office 2,163 8,659 6 3,129 2,169 11,788 13,957 7,081 1989 5-40 yrs.
1 unchanged sentence
North Shore Commons II Office 2,067 — ( 89 ) 11,410 1,978 11,410 13,388 4,544 2007 5-40 yrs.
−Removed: North End - Land Office 1,497 — 55 10 1,552 10 1,562 2 N/A 5-40 yrs.
+Added: North End - Land Office 1,497 — 55 10 1,552 10 1,562 3 2020 5-40 yrs.
One Shockoe Plaza Office — — 356 22,374 356 22,374 22,730 13,031 1996 5-40 yrs.
−Removed: Pavilion - Land Office 181 46 ( 181 ) ( 46 ) — — — — N/A N/A
Lake Brook Commons Office 1,600 8,864 ( 179 ) 367 1,421 9,231 10,652 4,173 1996 5-40 yrs.
−Removed: Sadler & Cox - Land Office 1,535 — 343 — 1,878 — 1,878 — N/A N/A
Highwoods Three Office 1,918 — 358 12,445 2,276 12,445 14,721 5,522 2005 5-40 yrs.
3 unchanged sentences
Stony Point IV Office 955 — — 13,659 955 13,659 14,614 5,024 2006 5-40 yrs.
+Added: 4480 Cox Road Office 1,301 6,036 15 3,491 1,316 9,527 10,843 4,717 1996 5-40 yrs.
+Added: Innsbrook Centre Office 914 8,249 — 677 914 8,926 9,840 4,406 1987 5-40 yrs.
HIGHWOODS PROPERTIES, INC.
10 unchanged sentences
Depreciation Date of
−Removed: 4480 Cox Road Office 1,301 6,036 15 3,448 1,316 9,484 10,800 4,281 1996 5-40 yrs.
−Removed: Innsbrook Centre Office 914 8,249 — 999 914 9,248 10,162 4,470 1987 5-40 yrs.
Meridian Three Office 2,673 16,470 — 6,379 2,673 22,849 25,522 9,488 1989 5-40 yrs.
13 unchanged sentences
Westshore Square Office 1,126 5,186 — 1,754 1,126 6,940 8,066 4,380 1976 5-40 yrs.
−Removed: Independence Park - Land Office 4,943 — 2,669 1,693 7,612 1,693 9,305 247 N/A 5-40 yrs.
−Removed: Independence One Office 2,531 4,526 — 2,407 2,531 6,933 9,464 2,349 1983 5-40 yrs.
Meridian One Office 1,849 22,363 — 5,464 1,849 27,827 29,676 8,416 1984 5-40 yrs.
6 unchanged sentences
(1) The cost basis for income tax purposes of aggregate land and buildings and tenant improvements as of December 31, 2023 is $ 6.6 billion.
+Added: (2) These assets are pledged as collateral for a $ 69.5 million first mortgage loan.
+Added: (3) These assets are pledged as collateral for a $ 124.5 million first mortgage loan.
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, in the City of Raleigh, State of North Carolina, on February 6, 2024.
16 unchanged sentences
Lloyd Director February 6, 2024
+Added: /s/ Candice W.
+Added: Todd Director February 6, 2024
/s/ Brendan C.
21 unchanged sentences
Lloyd Director of the General Partner February 6, 2024
+Added: /s/ Candice W.
+Added: Todd Director of the General Partner February 6, 2024
/s/ Brendan C.
3 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.