Quarterly report pursuant to Section 13 or 15(d)

Stock Based Compensation

Stock Based Compensation
9 Months Ended
Sep. 30, 2014
Share-based Compensation [Abstract]  
Stock Based Compensation
Washington REIT maintains short-term ("STIP") and long-term ("LTIP") incentive plans that allow for stock-based awards to officers and non-officer employees. Stock based awards are provided to officers and non-officer employees, as well as trustees, under the Washington Real Estate Investment Trust 2007 Omnibus Long-Term Incentive Plan which allows for awards in the form of restricted shares, restricted share units, options and other awards up to an aggregate of 2,000,000 shares over the ten year period in which the plan will be in effect. Restricted share units are converted into shares of our stock upon full vesting through the issuance of new shares.

During the 2014 Period, the Board of Trustees adopted a new STIP and new LTIP for executive officers. Regarding the new STIP, the changes from the prior STIP primarily removed the 15% service-only component of the award, maintaining an award payable 50% in cash and 50% in stock. The new LTIP is based entirely on total shareholder return during a defined three-year period. The LTIP was also converted from a single three-year plan structure to a “rolling” structure in which a new three-year plan is commenced each year. The vesting at the end of the performance period was modified to be 75% at the end of the performance period and 25% one year thereafter. In addition, during the transition period to the new LTIP, the Board of Trustees awarded similar transition awards with defined performance periods of one and two years and modified vesting to account for the transition.

Total Compensation Expense
Total compensation expense recognized in the consolidated financial statements for all outstanding share based awards was $1.3 million and $1.2 million for the 2014 and 2013 Quarters, respectively, and $3.8 million and $3.6 million for the 2014 and 2013 Periods, respectively.

Restricted Share Awards

The total fair values of restricted share awards vested was $1.0 million and $0.7 million for the 2014 and 2013 Periods, respectively.

The total unvested restricted share awards at September 30, 2014 was 207,082 shares, which had a weighted average grant date fair value of $25.37 per share. As of September 30, 2014, the total compensation cost related to unvested restricted share awards was $1.7 million, which we expect to recognize over a weighted average period of 17 months.