Annual report pursuant to Section 13 and 15(d)

Segment Information

v2.4.0.6
Segment Information
12 Months Ended
Dec. 31, 2011
Segment Reporting Information, Revenue for Reportable Segment [Abstract]  
Segment Information
SEGMENT INFORMATION
We have four reportable segments: office, medical office, retail, and multifamily properties. Office buildings provide office space for various types of businesses and professions. Medical office buildings provide offices and facilities for a variety of medical services. Retail centers are typically neighborhood grocery store or drug store anchored retail centers. Multifamily properties provide rental housing for families throughout the Washington metropolitan area.
Real estate rental revenue as a percentage of the total for each of the four reportable operating segments is as follows:
 
 
 
Year Ended December 31,
 
 
2011
 
2010
 
2009
Office
 
49
%
 
48
%
 
48
%
Medical office
 
16
%
 
17
%
 
18
%
Retail
 
17
%
 
16
%
 
16
%
Multifamily
 
18
%
 
19
%
 
18
%

The percentage of total income producing real estate assets, at cost, for each of the four reportable operating segments is as follows:
 
 
December 31,
 
 
2011
 
2010
Office
 
53
%
 
48
%
Medical office
 
17
%
 
19
%
Retail
 
17
%
 
17
%
Multifamily
 
13
%
 
16
%

The accounting policies of each of the segments are the same as those described in note 2 to the consolidated financial statements. We evaluate performance based upon operating income from the combined properties in each segment. Our reportable operating segments are consolidations of similar properties. GAAP requires that segment disclosures present the measure(s) used by the chief operating decision maker for purposes of assessing segments’ performance. Net operating income is a key measurement of our segment profit and loss. Net operating income is defined as segment real estate rental revenue less segment real estate expenses.

The following table presents revenues and net operating income for the years ended December 31, 2011, 2010 and 2009 from these segments, and reconciles net operating income of reportable segments to net income as reported (in thousands):
 
 
2011
 
 
Office
 
Medical
Office
 
Retail
 
Multifamily
 
Industrial/Flex
 
Corporate
and Other
 
Consolidated
Real estate rental revenue
 
$
142,870

 
$
45,257

 
$
50,421

 
$
50,979

 
 
 
$

 
$
289,527

Real estate expenses
 
48,960

 
14,242

 
14,273

 
19,717

 
 
 

 
97,192

Net operating income
 
$
93,910

 
$
31,015

 
$
36,148

 
$
31,262

 
 
 
$

 
$
192,335

Depreciation and amortization
 
 
 
 
 
 
 
 
 
 
 
 
 
(93,297
)
Interest expense
 
 
 
 
 
 
 
 
 
 
 
 
 
(66,473
)
General and administrative
 
 
 
 
 
 
 
 
 
 
 
 
 
(15,728
)
Acquisition costs
 
 
 
 
 
 
 
 
 
 
 
 
 
(3,607
)
Other income (expense)
 
 
 
 
 
 
 
 
 
 
 
 
 
1,144

Real estate impairment
 
 
 
 
 
 
 
 
 
 
 
 
 
(14,526
)
Loss on extinguishment of debt, net
 
 
 
 
 
 
 
 
 
 
 
 
 
(976
)
Gain from non-disposal activities
 
 
 
 
 
 
 
 
 
 
 
 
 

Discontinued operations:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income from discontinued operations
 
 
 
 
 
 
 
 
 
 
 
 
 
10,153

Gain on sale of real estate
 
 
 
 
 
 
 
 
 
 
 
 
 
97,491

Income tax benefit (expense)
 
 
 
 
 
 
 
 
 
 
 
 
 
(1,138
)
Net income
 
 
 
 
 
 
 
 
 
 
 
 
 
105,378

Less: Net income attributable to noncontrolling interests
 
 
 
 
 
 
 
 
 
 
 
 
 
(494
)
Net income attributable to the controlling interests
 
 
 
 
 
 
 
 
 
 
 
 
 
$
104,884

Capital expenditures
 
$
21,065

 
$
5,654

 
$
2,922

 
$
2,823

 
$
351

 
$
621

 
$
33,436

Total assets
 
$
1,118,074

 
$
347,735

 
$
365,164

 
$
247,170

 
$

 
$
42,615

 
$
2,120,758

 
 
 
2010
 
 
Office
 
Medical
Office
 
Retail
 
Multifamily
 
Industrial/Flex
 
Corporate
and Other
 
Consolidated
Real estate rental revenue
 
$
123,860

 
$
45,028

 
$
41,003

 
$
48,599

 
$

 
$

 
$
258,490

Real estate expenses
 
42,392

 
14,715

 
10,310

 
19,243

 

 

 
86,660

Net operating income
 
$
81,468

 
$
30,313

 
$
30,693

 
$
29,356

 
$

 
$

 
$
171,830

Depreciation and amortization
 
 
 
 
 
 
 
 
 
 
 
 
 
(80,066
)
Interest expense
 
 
 
 
 
 
 
 
 
 
 
 
 
(67,229
)
General and administrative
 
 
 
 
 
 
 
 
 
 
 
 
 
(14,406
)
Acquisition costs
 
 
 
 
 
 
 
 
 
 
 
 
 
(1,161
)
Other income (expense)
 
 
 
 
 
 
 
 
 
 
 
 
 
1,193

Loss on extinguishment of debt, net
 
 
 
 
 
 
 
 
 
 
 
 
 
(9,176
)
Gain from non-disposal activities
 
 
 
 
 
 
 
 
 
 
 
 
 
7

Discontinued operations:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income from discontinued operations
 
 
 
 
 
 
 
 
 
 
 
 
 
14,968

Gain on sale of real estate
 
 
 
 
 
 
 
 
 
 
 
 
 
21,599

Net income
 
 
 
 
 
 
 
 
 
 
 
 
 
37,559

Less: Net income attributable to noncontrolling interests
 
 
 
 
 
 
 
 
 
 
 
 
 
(133
)
Net income attributable to the controlling interests
 
 
 
 
 
 
 
 
 
 
 
 
 
$
37,426

Capital expenditures
 
$
13,983

 
$
4,986

 
$
1,982

 
$
2,387

 
$
1,707

 
$
392

 
$
25,437

Total assets
 
$
938,638

 
$
353,508

 
$
313,003

 
$
228,769

 
$
225,206

 
$
108,757

 
$
2,167,881

 
 
2009
 
 
Office
 
Medical
Office
 
Retail
 
Multifamily
 
Industrial/Flex
 
Corporate
and Other
 
Consolidated
Real estate rental revenue
 
$
123,347

 
$
44,911

 
$
41,821

 
$
46,470

 
$

 
$

 
$
256,549

Real estate expenses
 
43,897

 
15,218

 
10,680

 
19,494

 

 

 
89,289

Net operating income
 
$
79,450

 
$
29,693

 
$
31,141

 
$
26,976

 
$

 
$

 
$
167,260

Depreciation and amortization
 
 
 
 
 
 
 
 
 
 
 
 
 
(77,549
)
Interest expense
 
 
 
 
 
 
 
 
 
 
 
 
 
(72,694
)
General and administrative
 
 
 
 
 
 
 
 
 
 
 
 
 
(13,118
)
Acquisition costs
 
 
 
 
 
 
 
 
 
 
 
 
 
(788
)
Other income (expense)
 
 
 
 
 
 
 
 
 
 
 
 
 
1,205

Gain on extinguishment of debt, net
 
 
 
 
 
 
 
 
 
 
 
 
 
5,336

Gain from non-disposal activities
 
 
 
 
 
 
 
 
 
 
 
 
 
71

Discontinued operations:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income from discontinued operations
 
 
 
 
 
 
 
 
 
 
 
 
 
17,877

Gain on sale of real estate
 
 
 
 
 
 
 
 
 
 
 
 
 
13,348

Net income
 
 
 
 
 
 
 
 
 
 
 
 
 
40,948

Less: Net income attributable to noncontrolling interests
 
 
 
 
 
 
 
 
 
 
 
 
 
(203
)
Net income attributable to the controlling interests
 
 
 
 
 
 
 
 
 
 
 
 
 
$
40,745

Capital expenditures
 
$
14,200

 
$
6,613

 
$
1,270

 
$
2,287

 
$
2,967

 
$
351

 
$
27,688

Total assets
 
$
926,433

 
$
360,220

 
$
225,548

 
$
240,442

 
$
251,986

 
$
40,596

 
$
2,045,225