| Segment Reporting |
18. SEGMENT REPORTING
The Company operates in two business segments: (i) commercial and other real estate and (ii) multi-family real estate and services. The Company provides leasing, property management, acquisition, development, construction and tenant-related services for its commercial and other real estate and multi-family real estate portfolio. The Company’s multi-family services business also provides similar services for third parties. The Company had no revenues from foreign countries recorded for the three months ended March 31, 2020 and 2019. The Company had no long lived assets in foreign locations as of March 31, 2020 and December 31, 2019. The accounting policies of the segments are the same as those described in Note 2: Significant Accounting Policies, excluding depreciation and amortization.
The Company evaluates performance based upon net operating income from the combined properties and operations in each of its real estate segments (commercial and other real estate and multi-family real estate and services). All properties classified as discontinued operations have been excluded.
Selected results of operations for the three months ended March 31, 2020 and 2019 and selected asset information as of March 31, 2020 and December 31, 2019 regarding the Company’s operating segments are as follows. Amounts for prior periods have been restated to conform to the current period segment reporting presentation (dollars in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial |
|
|
Multi-family |
|
|
|
Corporate |
|
|
Total |
|
|
& Other Real Estate |
|
Real Estate & Services (d) |
|
|
|
& Other (e) |
|
|
Company |
Total revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended: |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
39,549 |
|
$ |
42,847 |
|
|
$ |
(339) |
|
$ |
82,057 |
March 31, 2019 |
|
54,077 |
|
|
36,359 |
|
|
|
(170) |
|
|
90,266 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating and |
|
|
|
|
|
|
|
|
|
|
|
|
interest expenses (a): |
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended: |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
16,290 |
|
$ |
22,773 |
|
|
$ |
32,216 |
|
$ |
71,279 |
March 31, 2019 |
|
23,992 |
|
|
21,188 |
|
|
|
29,618 |
|
|
74,798 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings (loss) of |
|
|
|
|
|
|
|
|
|
|
|
|
unconsolidated joint ventures: |
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended: |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
(117) |
|
$ |
(591) |
|
|
$ |
- |
|
$ |
(708) |
March 31, 2019 |
|
721 |
|
|
(1,402) |
|
|
|
- |
|
|
(681) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income (loss) (b): |
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended: |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
23,142 |
|
$ |
19,483 |
|
|
$ |
(32,555) |
|
$ |
10,070 |
March 31, 2019 |
|
30,806 |
|
|
13,769 |
|
|
|
(29,788) |
|
|
14,787 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets: |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
2,091,070 |
|
$ |
3,162,056 |
|
|
$ |
32,406 |
|
$ |
5,285,532 |
December 31, 2019 |
|
2,178,321 |
|
|
3,079,409 |
|
|
|
35,068 |
|
|
5,292,798 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total long-lived assets (c): |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
1,890,029 |
|
$ |
2,894,874 |
|
|
$ |
3,018 |
|
$ |
4,787,921 |
December 31, 2019 |
|
1,947,053 |
|
|
2,812,306 |
|
|
|
3,834 |
|
|
4,763,193 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total investments in |
|
|
|
|
|
|
|
|
|
|
|
|
unconsolidated joint ventures: |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
7,498 |
|
$ |
195,076 |
|
|
$ |
- |
|
$ |
202,574 |
December 31, 2019 |
|
7,367 |
|
|
201,724 |
|
|
|
- |
|
|
209,091 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)Total operating and interest expenses represent the sum of: real estate taxes; utilities; operating services; real estate services expenses; general and administrative, acquisition related costs and interest expense (net of interest income). All interest expense, net of interest and other investment income, (including for property-level mortgages) is excluded from segment amounts and classified in Corporate & Other for all periods.
(b)Net operating income represents total revenues less total operating and interest expenses (as defined and classified in Note “a”), plus equity in earnings (loss) of unconsolidated joint ventures, for the period.
(c)Long-lived assets are comprised of net investment in rental property, unbilled rents receivable and goodwill.
(d)Segment assets and operations were owned through a consolidated variable interest entity commencing in February 2018, and which also include the Company’s consolidated hotel operations.
(e)Corporate & Other represents all corporate-level items (including interest and other investment income, interest expense, non-property general and administrative expense), as well as intercompany eliminations necessary to reconcile to consolidated Company totals.
Mack-Cali Realty Corporation
The following schedule reconciles net operating income to net income (loss) available to common shareholders (dollars in thousands):
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2020 |
|
|
2019 |
Net operating income |
$ |
10,070 |
|
$ |
14,787 |
Add (deduct): |
|
|
|
|
|
Depreciation and amortization |
|
(33,796) |
|
|
(31,534) |
Land and other impairments |
|
(5,263) |
|
|
- |
Gain on change of control of interests |
|
- |
|
|
13,790 |
Realized gains (losses) and unrealized losses on disposition of |
|
|
|
|
|
rental property, net |
|
(7,915) |
|
|
268,109 |
Gain on disposition of developable land |
|
4,813 |
|
|
- |
Gain on sale of investment in unconsolidated joint venture |
|
- |
|
|
903 |
Gain from extinguishment of debt, net |
|
- |
|
|
1,311 |
Income (loss) from continuing operations |
|
(32,091) |
|
|
267,366 |
Discontinued operations |
|
|
|
|
|
Income from discontinued operations |
|
21,993 |
|
|
8,228 |
Realized gains (losses) and unrealized losses on |
|
|
|
|
|
disposition of rental property and impairments, net |
|
(27,746) |
|
|
- |
Total discontinued operations, net |
|
(5,753) |
|
|
8,228 |
Net income (loss) |
|
(37,844) |
|
|
275,594 |
Noncontrolling interests in consolidated joint ventures |
|
176 |
|
|
1,248 |
Noncontrolling interests in Operating Partnership |
|
3,666 |
|
|
(26,843) |
Noncontrolling interest in discontinued operations |
|
549 |
|
|
(837) |
Redeemable noncontrolling interests |
|
(6,471) |
|
|
(4,667) |
Net income (loss) available to common shareholders |
$ |
(39,924) |
|
$ |
244,495 |
Mack-Cali Realty, L.P.
The following schedule reconciles net operating income to net income (loss) available to common unitholders (dollars in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2020 |
|
|
2019 |
Net operating income |
$ |
10,070 |
|
$ |
14,787 |
Add (deduct): |
|
|
|
|
|
Depreciation and amortization |
|
(33,796) |
|
|
(31,534) |
Land and other impairments |
|
(5,263) |
|
|
- |
Gain on change of control of interests |
|
- |
|
|
13,790 |
Realized gains (losses) and unrealized losses on disposition of |
|
|
|
|
|
rental property, net |
|
(7,915) |
|
|
268,109 |
Gain on disposition of developable land |
|
4,813 |
|
|
- |
Gain on sale of investment in unconsolidated joint venture |
|
- |
|
|
903 |
Gain from extinguishment of debt, net |
|
- |
|
|
1,311 |
Income (loss) from continuing operations |
|
(32,091) |
|
|
267,366 |
Discontinued operations |
|
|
|
|
|
Income from discontinued operations |
|
21,993 |
|
|
8,228 |
Realized gains (losses) and unrealized losses on |
|
|
|
|
|
disposition of rental property and impairments, net |
|
(27,746) |
|
|
- |
Total discontinued operations, net |
|
(5,753) |
|
|
8,228 |
Net income (loss) |
|
(37,844) |
|
|
275,594 |
Noncontrolling interests in consolidated joint ventures |
|
176 |
|
|
1,248 |
Redeemable noncontrolling interests |
|
(6,471) |
|
|
(4,667) |
Net income (loss) available to common unitholders |
$ |
(44,139) |
|
$ |
272,175 |
|
| Segment Reporting |
18. SEGMENT REPORTING
The Company operates in two business segments: (i) commercial and other real estate and (ii) multi-family real estate and services. The Company provides leasing, property management, acquisition, development, construction and tenant-related services for its commercial and other real estate and multi-family real estate portfolio. The Company’s multi-family services business also provides similar services for third parties. The Company had no revenues from foreign countries recorded for the three months ended March 31, 2020 and 2019. The Company had no long lived assets in foreign locations as of March 31, 2020 and December 31, 2019. The accounting policies of the segments are the same as those described in Note 2: Significant Accounting Policies, excluding depreciation and amortization.
The Company evaluates performance based upon net operating income from the combined properties and operations in each of its real estate segments (commercial and other real estate and multi-family real estate and services). All properties classified as discontinued operations have been excluded.
Selected results of operations for the three months ended March 31, 2020 and 2019 and selected asset information as of March 31, 2020 and December 31, 2019 regarding the Company’s operating segments are as follows. Amounts for prior periods have been restated to conform to the current period segment reporting presentation (dollars in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial |
|
|
Multi-family |
|
|
|
Corporate |
|
|
Total |
|
|
& Other Real Estate |
|
Real Estate & Services (d) |
|
|
|
& Other (e) |
|
|
Company |
Total revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended: |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
39,549 |
|
$ |
42,847 |
|
|
$ |
(339) |
|
$ |
82,057 |
March 31, 2019 |
|
54,077 |
|
|
36,359 |
|
|
|
(170) |
|
|
90,266 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating and |
|
|
|
|
|
|
|
|
|
|
|
|
interest expenses (a): |
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended: |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
16,290 |
|
$ |
22,773 |
|
|
$ |
32,216 |
|
$ |
71,279 |
March 31, 2019 |
|
23,992 |
|
|
21,188 |
|
|
|
29,618 |
|
|
74,798 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings (loss) of |
|
|
|
|
|
|
|
|
|
|
|
|
unconsolidated joint ventures: |
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended: |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
(117) |
|
$ |
(591) |
|
|
$ |
- |
|
$ |
(708) |
March 31, 2019 |
|
721 |
|
|
(1,402) |
|
|
|
- |
|
|
(681) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income (loss) (b): |
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended: |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
23,142 |
|
$ |
19,483 |
|
|
$ |
(32,555) |
|
$ |
10,070 |
March 31, 2019 |
|
30,806 |
|
|
13,769 |
|
|
|
(29,788) |
|
|
14,787 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets: |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
2,091,070 |
|
$ |
3,162,056 |
|
|
$ |
32,406 |
|
$ |
5,285,532 |
December 31, 2019 |
|
2,178,321 |
|
|
3,079,409 |
|
|
|
35,068 |
|
|
5,292,798 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total long-lived assets (c): |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
1,890,029 |
|
$ |
2,894,874 |
|
|
$ |
3,018 |
|
$ |
4,787,921 |
December 31, 2019 |
|
1,947,053 |
|
|
2,812,306 |
|
|
|
3,834 |
|
|
4,763,193 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total investments in |
|
|
|
|
|
|
|
|
|
|
|
|
unconsolidated joint ventures: |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
$ |
7,498 |
|
$ |
195,076 |
|
|
$ |
- |
|
$ |
202,574 |
December 31, 2019 |
|
7,367 |
|
|
201,724 |
|
|
|
- |
|
|
209,091 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)Total operating and interest expenses represent the sum of: real estate taxes; utilities; operating services; real estate services expenses; general and administrative, acquisition related costs and interest expense (net of interest income). All interest expense, net of interest and other investment income, (including for property-level mortgages) is excluded from segment amounts and classified in Corporate & Other for all periods.
(b)Net operating income represents total revenues less total operating and interest expenses (as defined and classified in Note “a”), plus equity in earnings (loss) of unconsolidated joint ventures, for the period.
(c)Long-lived assets are comprised of net investment in rental property, unbilled rents receivable and goodwill.
(d)Segment assets and operations were owned through a consolidated variable interest entity commencing in February 2018, and which also include the Company’s consolidated hotel operations.
(e)Corporate & Other represents all corporate-level items (including interest and other investment income, interest expense, non-property general and administrative expense), as well as intercompany eliminations necessary to reconcile to consolidated Company totals.
Mack-Cali Realty Corporation
The following schedule reconciles net operating income to net income (loss) available to common shareholders (dollars in thousands):
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2020 |
|
|
2019 |
Net operating income |
$ |
10,070 |
|
$ |
14,787 |
Add (deduct): |
|
|
|
|
|
Depreciation and amortization |
|
(33,796) |
|
|
(31,534) |
Land and other impairments |
|
(5,263) |
|
|
- |
Gain on change of control of interests |
|
- |
|
|
13,790 |
Realized gains (losses) and unrealized losses on disposition of |
|
|
|
|
|
rental property, net |
|
(7,915) |
|
|
268,109 |
Gain on disposition of developable land |
|
4,813 |
|
|
- |
Gain on sale of investment in unconsolidated joint venture |
|
- |
|
|
903 |
Gain from extinguishment of debt, net |
|
- |
|
|
1,311 |
Income (loss) from continuing operations |
|
(32,091) |
|
|
267,366 |
Discontinued operations |
|
|
|
|
|
Income from discontinued operations |
|
21,993 |
|
|
8,228 |
Realized gains (losses) and unrealized losses on |
|
|
|
|
|
disposition of rental property and impairments, net |
|
(27,746) |
|
|
- |
Total discontinued operations, net |
|
(5,753) |
|
|
8,228 |
Net income (loss) |
|
(37,844) |
|
|
275,594 |
Noncontrolling interests in consolidated joint ventures |
|
176 |
|
|
1,248 |
Noncontrolling interests in Operating Partnership |
|
3,666 |
|
|
(26,843) |
Noncontrolling interest in discontinued operations |
|
549 |
|
|
(837) |
Redeemable noncontrolling interests |
|
(6,471) |
|
|
(4,667) |
Net income (loss) available to common shareholders |
$ |
(39,924) |
|
$ |
244,495 |
Mack-Cali Realty, L.P.
The following schedule reconciles net operating income to net income (loss) available to common unitholders (dollars in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2020 |
|
|
2019 |
Net operating income |
$ |
10,070 |
|
$ |
14,787 |
Add (deduct): |
|
|
|
|
|
Depreciation and amortization |
|
(33,796) |
|
|
(31,534) |
Land and other impairments |
|
(5,263) |
|
|
- |
Gain on change of control of interests |
|
- |
|
|
13,790 |
Realized gains (losses) and unrealized losses on disposition of |
|
|
|
|
|
rental property, net |
|
(7,915) |
|
|
268,109 |
Gain on disposition of developable land |
|
4,813 |
|
|
- |
Gain on sale of investment in unconsolidated joint venture |
|
- |
|
|
903 |
Gain from extinguishment of debt, net |
|
- |
|
|
1,311 |
Income (loss) from continuing operations |
|
(32,091) |
|
|
267,366 |
Discontinued operations |
|
|
|
|
|
Income from discontinued operations |
|
21,993 |
|
|
8,228 |
Realized gains (losses) and unrealized losses on |
|
|
|
|
|
disposition of rental property and impairments, net |
|
(27,746) |
|
|
- |
Total discontinued operations, net |
|
(5,753) |
|
|
8,228 |
Net income (loss) |
|
(37,844) |
|
|
275,594 |
Noncontrolling interests in consolidated joint ventures |
|
176 |
|
|
1,248 |
Redeemable noncontrolling interests |
|
(6,471) |
|
|
(4,667) |
Net income (loss) available to common unitholders |
$ |
(44,139) |
|
$ |
272,175 |
|