Properties Commencing Initial Operations

The following property commenced initial operations during the six months ended June 30, 2021 (dollars in thousands):

(a)As of June 30, 2021, 157 apartment units are currently available for occupancy. The development costs included approximately $2.9 million in land costs.

Additionally, a land lease located in Parsippany, New Jersey, with two restaurant tenants, also commenced initial operations during the six months ended June 30, 2021. Development costs incurred amounted to $5.1 million. This land lease was sold by the Company on June 30, 2021.

Real Estate Held for Sale/Discontinued Operations/Dispositions

On December 19, 2019, the Company announced that its Board had determined to sell the Company’s entire suburban New Jersey office portfolio totaling approximately 6.6 million square feet, which excludes the Company’s office properties in Jersey City and Hoboken, New Jersey, (collectively, the “Suburban Office Portfolio”).  As the decision to sell the Suburban Office Portfolio represented a strategic shift in the Company’s operations, these properties’ results (other than a property not qualified to be classified as held for sale) are being classified as discontinued operations for all periods presented herein. See Note 7: Discontinued Operations.

In late 2019 through June 30, 2021, the Company completed the sale of 34 of these suburban office properties, totaling 5.8 million square feet, for net sales proceeds of $989 million.  As of June 30, 2021, the Company has identified as held for sale the remaining two office properties (comprised of two identified disposal groups) in the Suburban Office Portfolio, totaling 0.5 million square feet (both of which the Company currently has under contract for sale for aggregate gross sales proceeds of approximately $54.3 million). In July 2021, the Company completed the sale of one of the properties held for sale, which was a 237,000 square foot office property, for a gross sales price of $29 million. The net proceeds were used to repay the outstanding balance of 2021 Term Loan of $27 million.

(a)As part of the consideration from the buyer, 678,302 Common Units were redeemed by the Company at a book value of $10.5 million, which was a non-cash portion of this sales transaction. The balance of the proceeds was received in cash and used to repay the Company's borrowings on its unsecured revolving credit facility. See Note 17: Noncontrolling Interests in Subsidiaries - Noncontrolling Interests in Operating Partnership.

(b)The mortgage loan encumbering three of the properties was defeased at closing, for which the Company incurred costs of $22.6 million. These costs were expensed as loss from extinguishment of debt during the three months ended June 30, 2021.

On May 24, 2021, the Company disposed of a developable land parcel located in Hamilton, New Jersey, for net sales proceeds of $745,000 (and recorded a net gain of $111,000 on the disposition).

Impairments on Properties and Land Held and Used

The Company determined that, due to the shortening of its expected period of ownership, which occurred during the second quarter 2021, the Company evaluated the recoverability of the carrying value of its office property in Hoboken, New Jersey, and determined that it was necessary to reduce the carrying value of the property to its estimated fair value. Accordingly, the Company recorded an impairment charge of $6.0 million on the office property at June 30, 2021, which is included in property impairments on the consolidated statement of operations. Also as a result of the Company’s shortening of its expected holding period in the second quarter 2021, the Company evaluated the recoverability of the carrying values of its land parcels and determined that it was necessary to reduce the carrying values of a held-and-used developable land parcel located in Jersey City, New Jersey, to its estimated fair value and recorded in land and other impairment charges an amount of $7.5 million for the three and six months ended June 30, 2021.